Gateway to Growth

Namibia's Rising Star in Global Hospitality Investment

What potential does the hospitality industry hold for investment opportunities? This and more are on the agenda for the Africa Hospitality Investment Forum (AHIF) event happening in Windhoek in June this year. Attended by the highest calibre of international hotel investors of any conference in Africa, this is the leading hospitality investment conference on the continent.

Olivier Granet, managing partner at Kasada Capital Management, spoke to us to explain the investment potential that Namibia holds as a destination. Kasada Capital Management is an independent real estate private equity platform dedicated to hospitality in Sub-Saharan Africa.

Olivier explains why they believe Namibia is a very interesting investment opportunity as a country and tourism market: “It is one of the most sparsely populated countries in the world. It offers a unique combination of space, security and authentic nature. It attracts over one million international visitors per year, and it offers unique hospitality investment opportunities. Its tourism sector saw arrivals surge to their highest point in the past five years, growing by 16.8% in 2023, which for us makes Namibia an attractive hospitality investment destination. At Kasada, we are always looking to further unlock investment potential in the region in line with our value-adding strategy of bringing capital and expertise to the hospitality sector in key cities across Africa, while also maintaining a diversified footprint.”

Namibia stands as a solid option for investment due to its stable political climate and resilient economy. Built upon peace, stability and good governance, with good infrastructure and exciting growth in a myriad of economic sectors, Namibia is poised to reach exciting heights in the future.

Olivier feels, though, that the investment potential of Namibia has not yet been fully unlocked. “With 15% of GDP share, way above the global average of 10%, tourism is a major contributor to Namibia’s economy, creating tens of thousands of jobs (almost 20% of all employment) directly or indirectly. However, because of its unique offer as a destination, we strongly believe this can go even further.”

Kasada believes that there are ways to unlock the investment potential of Namibia, as Olivier explains: “The Namibian hospitality market has experienced limited investment activity by regional and international brands due to the comparatively smaller size of the market versus other SADC capital cities, providing investment potential for a well-positioned complex of hotels in an as yet unsaturated market. Overall, the market is somewhat immature when it comes to distribution, sales and marketing, which means there is a lot of potential for investors like us to help the market level up to international brand portfolio and distribution network standards. We think that, given that leisure travel currently dominates hospitality occupancy in Namibia, a strong public-private partnership would help unlock potential by further diversifying the industry’s reach to new international markets.”

With the hospitality market making a comeback following the pandemic and leisure and business travel demands multiplying booking rates, the sentiment is that now is a great time to invest in the hospitality industry.

Olivier shares many reasons why Namibia is an attractive investment destination: “Namibia is a politically stable country with a low risk profile and currency peg that enables hedging and entails significantly lower credit risk compared to other African nations. According to Fitch Ratings, Namibia is on par with South Africa. In addition, Namibia offers welldeveloped tourism offerings for Sub-Saharan Africa and is an attractive leisure destination. It is also expected that the African Continental Free Trade Area (AfCFTA) agreement will boost intra-regional tourism, with the added benefit of sustainability in that the country has untapped potential in renewable energy which will be a significant catalyst for foreign investments.”

If you would like to hear more about the potential for investment that Namibia holds in the hospitality industry, be sure to join the Africa Hospitality Investment Forum, which aims to connect business leaders from international and local markets, while driving investment into tourism projects, infrastructure and hotel development across Africa.

Kirsty Watermeyer