Zanzibar Tanzania Tourism Market Review August 2017
Emerging Zanzibar could be next Mauritius, as mega projects target international marketplace Government aims to double foreign tourist arrivals by 2020
International Visitor Arrival Trend Number of Visitors 400,000 350,000 300,000 250,000 200,000 150,000 100,000 50,000 0 2012
“Zanzibar is an archipelago, located off the East coast of Africa. The islands are characterized by a unique cultural heritage, numerous beaches and world famous Stone Town as its historical jewel. In 2000, the town was designated as a UNESCO World Heritage Site, which has helped gain international attention for its tourism industry. Last year, the destination recorded a total of 376,242 foreign visitor arrivals, with a y-o-y growth of 28%. Looking at the historical trend of overseas arrivals, the island achieved a 5-year CAGR of 17%. This is largely attributed to increased airlift from direct international flights. Additionally, the destination has a pronounced seasonality trend, with the high season starting in July running to February. During this period in 2016, Zanzibar hosted more than 30,000 foreigners per month.
% 80 70 60 50 40 30 20 10 0 -10 2013
2014
International Visitors
2015
2016
Annual Growth Rate
Source: Zanzibar Commission for Tourism and C9 Hotelworks Market Research
Currently, there are 454 registered accommodation establishments in Zanzibar, with 79% belonging to economy and midscale properties. However, with upcoming luxury hotel developments underway, the destination is expected to broaden its tourism demand spectrum to target high-spending travelers.” Bill Barnett, Managing Director, C9 Hotelworks
Trends
Forward Outlook
•
Top five international source markets in 2016 were Italy, Germany, the United Kingdom, United States and South Africa with a combined 45% share of total traffic.
•
New direct flight service from Tel Aviv to Zanzibar on El Al Israel Airlines is scheduled to commence in October this year, which will further stimulate tourism numbers.
•
Average length of stay (ALOS) for foreigners is 7 nights, with tourists typically spending one to two nights in Stone Town and the remaining of their stay by the beach.
•
Two significant mega projects, Zanzibar Amber Resort and Fumba Town Development are under construction. Amber has announced two hotel projects managed by Ritz-Carlton and Anantara.
•
A large proportion of tourists who travel to Zanzibar also go on safari tours, mainly in mainland Tanzania and Kenya.
•
Foreign ownership of landed properties for investment purpose is allowed on a 99-year leasehold term.
TOURISM Demand Indicators • In 2016, there were 376,242 international visitors traveling to the island, with 81% arriving via Zanzibar International Airport, and the remaining 19% through the seaport.
Zanzibar Airport International & Domestic Passenger Arrivals Number of Passengers 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 Jan
Feb
Mar
Apr May
International Arrivals
Jun
Jul
Aug
Sep
Domestic Arrivals
Oct
Nov
Dec
2016 Total Arrivals
Travelers arriving on international flights accounted for 57% of total inbound passengers
Source: Zanzibar Commission for Tourism and C9 Hotelworks Market Research
Key International Geographic Source Markets Number of Visitors 250,000 200,000 150,000 100,000 50,000
0 Europe
Africa
Asia
North America Middle East 2014
2015
2016
Last year, European countries accounted for 61% of total overseas visitors
Source: Zanzibar Commission for Tourism and C9 Hotelworks Market Research
Seasonality of International Visitors Number of Visitors 50,000 40,000 30,000 20,000 10,000 0 Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
2014
Sep
Oct 2015
Nov
Dec 2016
Source: Zanzibar Commission for Tourism and C9 Hotelworks Market Research
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C9 Zanzibar Tourism Market Review: August 2017
High season in Zanzibar is considerably longer than many beach destinations, lasting 8 months of the year
HOTEL & RESIDENTIAL OVERVIEW Hotel Supply by Tier 7%
Although existing hotel supply is mainly concentrated in the economy tier, pipeline projects are focused in luxury segment
14% 44%
Economy Midscale
35%
Upscale Luxury Source: Zanzibar Commission for Tourism and C9 Hotelworks Market Research
Residential Development Characteristics • Currently there are two notable projects open for sale, namely Fumba Town Development and Turtle Residence Beach Apartments, which total 354 units.
Average Built-up Area
Sq.m
There is currently strong uplift in the property market from overseas investment oriented buyers
300 200 100 0
One- to Three-Bedroom Condominiums
Two- to Six-Bedroom Townhouses Source: C9 Hotelworks Market Research
Average Sales Price and Sales Pace In USD per Sq.m
Less than 10% of the residential product offerings have an absolute price point above USD150,000
Units Sold Per Month
1,000 800 600 400 200 0
15 12 9 6 3 0 One- to Three-Bedroom Condominiums Built-up Sales Price
Two- to Six-Bedroom Townhouses Monthly Sales Pace Source: C9 Hotelworks Market Research
Pipeline Projects
• In addition to the pipeline projects listed below, Villas Mbweni located in Mbweni just launched sales in August of this year, which added 8 villas to the market. Project Name
Location
Units
Estimated Launch
Amber Resort Zanzibar
Matemwe
5,354
Oct-17
Zamani Villas
Kiwengwa
8
Oct-17
Kendwa Condos
Kendwa
69
Dec-17
The Palm Royal
Kiwengwa
98
Jan-18
Fumba Uptown Living
Fumba
500
TBA Source: C9 Hotelworks Market Research
C9 Zanzibar Tourism Market Review: August 2017
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About C9 Hotelworks C9 Hotelworks is an internationally recognized consulting firm with extensive experience in the Asia Pacific region. Its core business focus includes: • • •
Hotel and Resort Development Asset Management / Ownership Representation Project Feasibility and Analysis
Key competencies include international hotel operator search, selection and contract negotiation, mixed use hotel and residential planning and operation reviews. A wide range of both institutional and private developers and a comprehensive portfolio of completed projects give C9 the skill set and background to focus on key issues, evaluate complex ones and assist clients in achieving solid results. Based in Phuket, Thailand and led by Managing Director Bill Barnett, who has 30 years of experience in Asia Pacific, the firm is well positioned to serve an increasing demanding marketplace.
C9 Hotelworks Company Limited 9 Lagoon Road, Cherngtalay, Thalang, Phuket, 83110, Thailand (Office located at the entrance of Laguna Phuket) T: +66 (0)76 271 535 F: +66 (0)76 271 536
www.c9hotelworks.com info@c9hotelworks.com