South Africa Hotel Occupancies Improve in Second Half of 2000 reports Arthur Andersen survey

Of the six provinces reported on by the Arthur Andersen Hotel Industry Benchmark Survey, four reported increases in average room rates for 2000 in excess of inflation. Eastern Cape led the way with an increase of 12.1 percent in average room rates, when measured in South African Rand. Other beneficiaries were Free State with a 9.6 percent improvement in average room rate, Kwazulu Natal with 8.1 percent and the Western Cape with 8.6 percent.

Dean Wallace, head of Arthur Andersen's Hospitality and Leisure Practice in South Africa, commented, "It is clear that the South African hospitality industry is showing signs of recovery after the uncertainties of the earlier part of 2000, including the political turmoil in Zimbabwe and the pressures on the Rand."

Average room rates of hotels surveyed by Arthur Andersen are still low when compared to equivalent properties in places such as Australia. The overall average room rate achieved in South Africa for 2000, was approximately US$50, with the Western Cape achieving the highest average room rate of US$55 and Mpumalanga the lowest at US$34. These contrast with overall rates in Australia of US$88, with Northern Territories achieving the lowest rate of US$60.

The continued focus of Government on tourism, recent plans to develop South Africa's world heritage sites, and initiatives such as removing the border fence between South Africa and Mozambique in the Kruger Park, effectively increasing the size of the park from 35 000 to 99 000 square kilometers, should see continued future growth in both domestic and international tourism during 2001.

The Hotel Industry Benchmark Survey provides contributors with an independent third party insight into market trends by benchmarking operating performance month on month. Launched in 1996 as the definitive source of hotel performance data outside North America, the Arthur Andersen Hotel Industry Benchmark Survey comprises information gathered from more than 4,000 hotels in 200 markets across 140 countries. The survey currently tracks hotel performance everywhere outside North America. Regional surveys are produced for Asia Pacific, Europe and the Middle East and Africa. These are supported by in-depth country/city reports for Australia, Germany, South Africa, the UK and London. Arthur Andersen will continue to expand the coverage of the Hotel Industry Benchmark Survey during 2001 to report on more markets. New surveys under development include New Zealand, Italy, Latin America, Caribbean and Scandinavia. For more information about our South African survey please contact Dean Wallace on 27 11 328 3132. For information on any of our other surveys please e-mail us at [email protected] or visit us at our web site www.hotelbenchmark.com.

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