Onomo Hotels to branch out to other East African nations

Tuesday November 27 2018

After Rwanda, Onomo Hotels also plans to add

After Rwanda, Onomo Hotels also plans to add five more mid-range hotels, including one in Kampala in Uganda, Nairobi in Kenya, Dar es Salaam in Tanzania, Addis Ababa in Ethiopia and Djibouti. PHOTO | Cyril NDEGEYA 

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Pan African hotel chain Onomo Hotels is looking to invest in East Africa, despite a tough operating environment. After Rwanda, Onomo Hotels plans to add five more hotels in Uganda, Kenya, Tanzania, Ethiopia and Djibouti.

“Our five-year strategic plan ending 2022 involves building 20 hotels in Africa. We currently have 12 operating hotels while eight are under construction,” said Onomo Hotels president Julien Ruggieri during the opening of the $20 million 109-room Onomo Hotel Kigali — the first in East Africa.

Mr Ruggieri said the region’s hotel industry is competitive, but promised to ride on the Pan African brand, maintain African dishes and culture to stay in business.

“Onomo is a long-term investor who understands and is equipped to withstand market cycles. We believe that our experience, processes and commitment in investing in our people enables us to succeed in ‘tough’ markets,” said the hotel’s management.

The completion of Onomo hotel has increased the number of hotel rooms in Kigali to 524, which includes Onomo’s 109 rooms, Marriott Kigali’s 254 rooms and Park Inn by Radisson’s 161. Ramada Kigali is expected to add 154 more rooms.

The Kigali market has remained challenging for hotel operators who are reporting low occupancy rates. The 2018 East Africa Hotel Review report by JLL, an American real estate firm, says the occupancy rate in Kigali’s quality hotels has averaged 49 per cent, yet the industry’s average is 70 per cent to remain profitable.

The report shows that investors in Nairobi’s hotels struggle most to attract customers with an average of 47 per cent occupancy rate, Dar es Salaam at 52 per cent and Kampala at 56 per cent.

As a result, of the low occupancy rate, some developers who financed the projects through loans have lost them to lenders through auction after failing to service the loans. Others have closed operations.

Onomo Hotels is now present in nine countries in Senegal, Ivory Coast, Gabon, Mali, Togo, Cape Town, Sandton and Durban in South Africa, Guinea, Kigali in Rwanda, and Rabat in Morocco.