Hoteliers expect that a strong conferencing pipeline for Sandton, including the securing of next years G20 Summit, will provide a much-needed boost to flagging average room rates (ARR) in the precinct.
According to January to May data from Smith Travel Research, five-star hotels in Africas richest square mile have been grappling with ARRs that are well below the national average and 23% lower than those achieved in pre-COVID 2019. Sandtons ARR of R1411 is just 49% of the national average, with KwaZulu-Natal (R2867) and Cape Town (R4104) both comfortably exceeding 2019 levels.
On a positive note, occupancy rates at the high-end hotels in the precinct stand at 66%, exceeding the 62% achieved in Jan-May 2019. But, as advisory firm BDO highlights in its 2024 Tourism Trends report, the data indicates that hotel operators are clearly sacrificing rate in favour of occupancy.
Francois van Heerden , Chairperson of the Sandton Tourism and Business Association (STBA), told Travel News that hotels at the top end of the pricing range needed to lift their ceilings for the rest of the industry to follow, but had been challenged by a number of prevailing conditions.
