Africa -  Tanzania - Dar es Salaam

Tanzania has sustained high growth over the last decade averaging between 6% to 7% annual GDP growth, however, the recent cut in government conferences and increased taxes has led to a sluggish growth in room night demand. The current President John Pombe Magufuli has prioritized efforts to clampdown on corruption, improve public administration, cut down on government spending and providing free education. While these efforts seem to be bearing fruit, his policies on increased taxation (which also includes an 18% VAT on tourism services) and regulation on foreign companies, especially the mining sector, has resulted in a reduction in foreign direct investment. This has resulted in the World Bank revising the country’s growth estimates downwards. While the GDP growth in 2017 has been slower by half a percentage point as compared to 2016, it is still the highest in the East African Community for 2017. The impact of direct flights to Zanzibar from neighbouring countries may also be a factor for decline in the overnight leisure demand in Dar Es Salaam.

In 2017, hotel RevPARs in Dar Es Salaam saw a double-digit decline, almost in equal part due to decrease in hotel occupancy and average room rates. The average rate decline was also in part due to the weakening of the Tanzanian Shilling as compared to the US Dollar. Going forward, while brands such as Rotana, element, City Lodge are gearing to open hotels in the city, we anticipate a growth in accommodated room nights which would get absorbed by the new supply resulting in a stable outlook for Dar Es Salaam.

Exchange Rate:

Exchange Rate 2016 Exchange Rate 2017 Change 2016/2017 Exchange Rate 2018 Change 2017/2018
US$ 1 0 0
Tanzania - Dar es Salaam 0.00045 0.00044 -2.2% 0.00044 0.0%

Change In Value For Market:

Legend
Significant Value Increase: Greater than +10%
Moderate Value Increase: Between +3% and +10%
Stable Values: Between -3% and +3%
Moderate Value Decline: Between -3% and -10%
Significant Value Decline: Less than -10%

Tanzania - Dar es Salaam RevPAR Change

Tanzania - Dar es Salaam RevPAR

Year RevPAR
2015 77.17
2016 69.09
2017 61.54
2018 (f) 60.39
2019 (f) 60.33
2020 (f) 60.86

For more information, please contact:

Tim Smith, MRICS
[email protected]
  • +27 797 342296 (w)
Rishabh Thapar
[email protected]
  • +27 0 792790584 (m)
Laura Dutrieux
[email protected]