Tsogo Sun is an African hotel, gaming and entertainment giant, with a portfolio of 14 casinos and over 90 properties across Africa and the Seychelles. It’s no surprise then that they have a couple of experienced operators on their payroll, such as Gauteng North Director of Operations Norman Wallace, Business Traveller Africa’s lunch host on this occasion, at Tsogo Sun’s 54 on Bath property in Johannesburg.
The Tsogo Sun portfolio is extensive, with its South African footprint alone covering nine provinces, before you’ve even looked north to the group’s presence in six other African countries – Kenya, Mozambique, Nigeria, Tanzania, Zambia and Seychelles.
Southern Sun is the group’s premier brand, but the offering is widespread, with everything from SUN1 (previously Formula 1) to StayEasy, Garden Court and SunSquare, all the way up to 5-star brands such as Palazzo, Beverly Hills, 54 on Bath and Sandton Sun.
That being said, a bigger group means more exposure, and Tsogo Sun has not been exempt from the challenges the hotel industry has faced, particularly in South Africa.
“The current scenario is that the industry is coming out of a trough – a period of oversupply we found ourselves in post-2010,” says Wallace. “We still need a lot more demand to come into the market to absorb that oversupply.”
One of the by-products of challenging times is introspection, and Tsogo Sun has had a long, hard look at what its offering is.
“We’re looking at putting a lot more excitement back into our hotels, by adding a bit of ‘pizzazz’ into the auxillary services” says Wallace. “That means we are refreshing the delivery in our bar, breakfast, dinner and conference experiences.”
Those aren’t the only changes Tsogo Sun has looked at in recent times. The group has also made improvements to its Wi-Fi offering, which is now free from the first connection, after which a cap is set at different levels at different hotels.
“We believe the business traveller values a great sleep experience and a quality workspace in his or her room, complemented by good food and beverage offerings, quality Wi-Fi, and top notch exercise facilities,” says Wallace.
These elements are of arguably even greater importance in the likes of Kenya, Mozambique, Nigeria, Tanzania and Zambia, where the focus is clearly on business travel, as opposed to leisure. As a result, it was no surprise to see Tsogo Sun recently spend $30-million on a refurb of the Southern Sun Maputo. This involved a complete refurbishment of the existing 158-room hotel, including the bedrooms and public areas, as well as an expansion of the restaurant, and the addition of 110 new hotel rooms and new conferencing facilities.
That was preceded in late 2013 by the announcement that Tsogo Sun was acquiring a 75.5% stake in the Southern Sun Ikoyi Hotel in Lagos, Nigeria. A shrewd investment, if one considers the business travel interest in Africa’s biggest economy, and Lagos is at the heart of it, with Victoria Island the city’s commercial hub. The Southern Sun Ikoyi is therefore well-positioned, centrally-located on VI, with 195 rooms and suites, a restaurant that does a great Sunday lunch buffet, a business centre and meeting room facilities.
North of South Africa is clearly where there are great growth prospects, and Tsogo Sun is nicely positioned with a presence in five of arguably the most prominent African business travel destinations – Kenya, Mozambique, Nigeria, Tanzania and Zambia.
“Outside of South Africa we are fortunate to have experienced general managers who run our properties as standalone businesses,” says Wallace.
With its portfolio on the African continent, Tsogo Sun has a march on all those ‘international’ hotel groups all jostling for position in Africa with new properties and/or new management contracts. But Wallace is cautious about the road ahead for Tsogo Sun.
“With regards future developments outside of South Africa, the cost to entry is very high, and thus each opportunity will be evaluated on a cost and return basis,” he says.
Interesting times ahead for the African hotel industry, but Tsogo Sun is well-positioned to further entrench itself in the South African market, whilst slowly chipping away north of the country’s borders and ensuring they have a presence in the African markets that count.
Dylan Rogers