South African hospitality group Tsogo Sun is closing its Southern Sun Mayfair Hotel in Nairobi whose employees have been sacked.
The multinational says it will close the hotel at the end of this month, opting out of the market in which it has operated for a decade.
“Tsogo Sun Hotels confirm that the Southern Sun Mayfair Nairobi in Kenya will not renew its lease and will officially cease operations on the January 31, 2020,” the company said in a response to queries by the Business Daily.
“Employee contracts have been terminated after due consultation. All staff have been provided with the necessary support aligned with the labour laws.”
The 171-room hotel has faced increased competition over the past decade as the hospitality industry has witnessed the entry of new players and expansion by established brands.
The opening of the new properties saw the available rooms hit over 20,000. New signings over the past two years spurred the growth of the number of hotels in Kenya’s pipeline with the Hotel Chain Development Pipelines in Africa 2019 report showing that another 27 hotels will soon be opened in Kenya.
Kenya is estimated to have 68 global branded hotels, a number that is expected to increase with the current investment trend.
The new hotels will bring to the market 4,232 new hotel rooms by 2023. The bulk of the hotels in the pipeline are expected to open in 2021, with 1,155 rooms scheduled to enter the market.
Radisson, Accor, City Lodge, Hilton, Swiss International, City Blue and Marriott are some of the brands expected to grow their local footprint with new properties in the country. Existing hospitality firms including Simba Corporation and TPS Eastern Africa, the owner of the Serena hotels brand, have also been expanding their portfolio.