Africa -  Namibia - Windhoek

For a comprehensive review of the Africa market, click below:
HVS In-Depth Africa Hotel Valuation Index:   2016 | 2015 | 2014

Namibia is one of the world’s largest producers of uranium and its economy has been hit hard by a drop in uranium revenues as it is heavily dependent on the extraction and processing of minerals for export. According to the IMF Namibia’s GDP growth dropped by 1.2% but is forecast to recover by 1.2% in 2018 and even grow by 3.3% and 3.8% in 2019 and 2020 respectively.

To attract foreign direct investment in the manufacturing and export-orientated industries, a number of incentive programmes for foreign investors have been put in place and cheap construction permits should incentivise investors to build properties or infrastructure. In a further attempt to boost economic growth, the Bank of Namibia cut the repo rate by 25 basis points in August 2017.

Windhoek’s hotel industry is seeing a double-digit value per room growth in 2017 for the second year in a row, due to another high increase in ADR. For 2018 the high growth in RevPAR is projected to slow down as domestic/regional tourism deceases due to inflated petrol prices.

Nonetheless, future tourist numbers are bound to increase for Windhoek as new airline links have recently been created, making the travel to Namibia a lot easier, shorter and more cost effective. Eurowings introduced a new non-stop connection between Munich and Windhoek two times a week from July 2017; Air Namibia started to operate a Windhoek – Accra – Lagos route in June this year which will operate four times a week and reduce travel times between Namibia, Ghana and Nigeria by over 60% according to Mandi Samson (MD Air Namibia). In terms of hotel pipelines, the Hilton Garden Inn is expected to open its 174 rooms for reservations at the end of August this year, in addition to the existing Hilton Windhoek.

The widespread impact of the coronavirus (COVID-19) has had an unprecedented impact on hotels and hotel values worldwide. Consequently, the latest HVI analysis may no longer reflect the most current measure of lodging industry strength or the hospitality investment market.

In each of our offices across the globe, we are working tirelessly to analyze the impact of recent events and provide timely insights to help you navigate these uncharted waters. Because it is unclear how long the pandemic will last or how long related restrictions will be in place, we are updating our analyses on a weekly basis using the most current data.

Additionally, examination of value trends in prior cycles can provide useful information. Historical patterns, together with an understanding of the market’s current expectations for the eventual recovery of the industry and its performance, can provide insights on the likely trajectory of decline and recovery for hotel values.

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For more information, please contact:

Tim Smith, MRICS
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Rishabh Thapar
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