By Julius Baumann

The continued difficulty in raising funds to finance new hotel projects in SA and the rest of the continent was high on the agenda at the Hospitality Investment Conference Africa in Sandton on Monday.

Ed Fuller, MD of Marriott International, said on Monday that difficultly in securing finance was one of the main reasons holding back Marriott’s expansion into Southern Africa.

“While we have identified several opportunities in the region and have been keen to expand into SA for a number of years, finding finance has been a continuing problem we are only now getting on top of,” he said.

The hotel group is keen to bring the Ritz Carlton to Cape Town and Johannesburg, as well as other hotel developments

“We are getting closer to a decision but are not there yet,” Mr Fuller said.

Arthur de Haast, CEO of Jones Lang laSalle, a global property services firm, pointed out that while there are huge growth opportunities in sub-Saharan Africa, the region does not feature on the radar of investors in the developed world.

“The biggest pot of funds is in pension funds, but these funds are tightly regulated and extremely restricted (in terms of) where they are able to invest,” Mr De Haast said.

Kurt Ritter, CEO of the rapidly expanding Rezidor hotel group, said that “in Africa there has always been a credit crunch”, with little funding available for hotel projects.

He said many of Rezidor’s projects in SA and Africa have been funded by rich individuals and through the Scandinavian fund AfriNor.

Source: Business Day