Nairobi hotels recorded their lowest occupancy in a rating of 14 African cities last year as new establishments boosted Kenya's total bed space even as the number of tourists arrivals rose compared to the previous year, according to industry researcher HTI Consulting.
Nairobi's occupancy performance was the weakest of the 14 cities assessed with a decline of 11.1 per cent. The cities include Addis Ababa, Accra, Cape Town, Dakar, Dar es Salaam, Lagos, Lusaka, Monrovia, Gaborone and Windhoek.
According to the study, there was high growth in new supply with an 8.7 per cent increase in rooms available despite jitters surrounding the August 2017 General Election.
"Supply grew by 478 rooms of which 334 were internationally branded (Four Points Sheraton, Park Inn)," notes the study.
Past data from the Tourism ministry shows the contribution of visitor arrivals from East Africa helped grow Kenya's overall tourism arrivals to 1.47 million last year, up from 1.34 million in 2016 although the numbers remained well below a peak of 1.83 million in 2011.
The increase saw the country's revenue from tourism jump 20 per cent last year even as the sector continued to recover from a series of terrorist attacks on the country a few years ago that had scared away foreign visitors.
Revenue from tourism, one of Kenya's main hard currency earners alongside tea and horticulture, totalled Sh120 billion for 2017, Tourism secretary Najib Balala said early February.
"Kenya grew stronger in 2017 as a destination brand following positive visibility... This was achieved despite a busy electioneering season that threatened to slow down tourism activities," Mr Balala said.
According to the HTI study, Dar es Salaam followed Nairobi with a decline in occupancy of nine per cent.
This is linked to uncertainty by investors in the country in terms of new government policy, which it notes limited business travel to the Tanzanian city.
"In addition direct flights to key tourism destinations has reduced leisure demand for Dar es Salaam," says the study.
Addis Ababa and Gaborone also had lower occupancies following a decline in growth of 10 per cent and 7.1 per cent respectively in 2016.
"Although supply has increased in these cities, demand is declining due to political unrest (Addis Ababa) and economic challenges driven by mining (Gaborone)," says the study.