togo, the rising star - colliers · pdf fileagreements with cruise operators e.g. royal...

Togo, The Rising StarTourism & Hospitality Review | 2016

Togo Market Snapshot | Tourism & Hotels | Colliers International2

Togo Market Snapshot | Tourism & Hotels | Colliers International

Table of Contents

3

TOGO COUNTRY OVERVIEW

GNASSINGBE EYADEMA AIRPORTBuilding The West African Hub

LOME SEAPORTKey Demand Generator

TOGO TOURISM SWOT ANALYSIS

TAPPING INTO GENERATION Y

MARKET OPPORTUNITIESDeveloping The Right Asset Type

4

5

6

7

7

8

9

MARKET OUTLOOK 10


52% 48%

Business Spending Leisure Spending

CAGR = 3%

2012

6.64 million

2016(f)

7.47 million

2020(f)

8.10 million POPULATION

population is coming of age creating a workforce with

disposable income and this informs the decision of

hospitality products tailored for them by operators.

Countries surrounding Togo such as Benin, Ghana and

Nigeria have a high Generation Y & Z population in

excess of 123 million which represents more than 50%

of the population in the countries.

Source: The World Bank, 2016

Source: WTTC, 2016

TOGO KEY ECONOMIC INDICATORS

DIRECT CONTRIBUTION OF TRAVEL AND TOURISM TO GDP

TOGO POPULATION EVOLUTION

INTRODUCTION

Togo, is a narrow land

mass of 57,000 sq. km

spanning northwards from

the shores of the Atlantic in

West Africa. The country

borders Ghana to the West

and Benin to the East via

the Gulf of Guinea and

shares a border with

Burkina Faso to the North.

The country is a member of

the Economic Community

of West African States

(ECOWAS), which has its

development fund

headquarters in Lomé.

GROSS DOMESTIC PRODUCT (GDP)

The recent pace of economic growth has contributed

to improving human development indicators.

results as civil strife has dissipated.

Economic growth has remained strong in recent

years due to agricultural production, the construction

of the main road networks, and the expansion of

other major infrastructure.

Source: International Monetary Fund (IMF), 2016

Note: Nominal GDP Values =

TOGO COUNTRY

OVERVIEW

A growing GDP, young population

and strong ties with neighboring

countries is an indicator that Togo

presents opportunities for

development of tourism & hospitality

products that attract travelers from

within its borders and beyond.

4

Year 2012 2016(f) 2020(f)

Nominal

GDP 3.00 3.99 5.42

Real GDP

Growth %5.90% 5.60% 5.50%

Inflation % 2.6% 2.1% 2.5%

ECONOMIC CONTRIBUTION OF TRAVEL AND TOURISM

GDP has risen sharply since 2009 as the country began

recovering from recession triggering both corporate and

leisure tourism to gain momentum.

64.6% of population

below 35 years of age

TOGO TOURISM SPENDING TRENDS

Source: WTTC, 2016

Gen Y & Z

53.5

152.4

175.5

0

20

40

60

80

100

120

140

160

180

200

EU

R M

illions

Nominal Tourism GDP (EUR Millions)


Source: Société Aéroportuaire de Lomé Tokoin (SALT), 2016

TOGO AIRPORT PASSENGER FORECASTS

AIRLINES FLYING TO GNASSINGBÉ EYADEMA AIRPORT

The Gnassingbé Eyadema Airport will have

the capability to handle the Airbus A380, a

novelty among West African airports, and this

-regional

KEY INFORMATION

At present the airport serves as a hub for

Ethiopian Airlines' West African subsidiary, ASKY

Airlines.

In 2013, tourism flows into Togo began

increasing, contributing 25% of the total airport

arrival numbers after a slump in the market.

US$150 million was set aside for the

modernization and expansion of Gnassingbé

Eyadema Airport.

The new terminal started operations in April

2016 and was inaugurated by President Faure

Gnassingbé. Ultimately, it will be able process 2.5

million passengers annually and accommodate

A380 aircraft hence attracting more airline

demand to the airport and transform Lomé into a

-

In the long-term there are plans to build a brand

new airport at Tsevié, 40 km. from Lomé.

AIRPORT IMPROVEMENTS

The construction of a new 21,000m² terminal

with three levels conforming to IATA

standards.

Capacity to simultaneously handle two large

planes and three medium-sized planes, and

15 aircraft in total.

Construction of a second taxiway and

elongating the existing one.

The development of a North-West axis

connecting both runway thresholds.

The integration of VIP lounges.

Offices and luxury duty-free shops.

Rehabilitation of the freight terminal to

process approximately 50,000 tons per year

against the current 10,000 tons.

The construction of an upscale hotel near the

terminal to accommodate transit passengers

and business travelers.

These upgrades are expected to attract new

flight carriers and hence more flight routes both

within Africa and internationally aiding in the

growth of tourism inflows via air travel.

5

GNASSINGBÉ EYADEMA AIRPORT

ASKY AIRLINES KEY FACTS AND FIGURES

3 Boeing 737-700

4 Dash 8 Q400

Flies to 22 destinations in 20 West and Central African

countries.

Has 210 weekly flights ferrying 10,000 passengers

Employs 250 ground, technical and

cabin crew

760 813 870 914 950 988

382552

472589

707 760

9601,075

1,1721,265

1,354

0

200

400

600

800

1,000

1,200

1,400

1,600

2010

2011

2012

2013

2014

2015

2016

(f)

2017

(f)

2018

(f)

2019

(f)

2020(f

)

No. of

Passengers

('0

00

)

Conservative Base Case Optimistic

Building The West African Hub


LOMÉ SEAPORTLomé has one of the deepest sea port in all of

Western Africa. The Lomé Container Terminal

(LCT), currently under construction will have an

annual handling capacity of 2.2 million twenty-foot

container units. This project will allow shipping

companies to deploy the largest container vessels in

West and Central Africa.

The construction of a third pier for container ships

will have a length of 450 meters and a depth of 15

meters.

POTENTIAL FOR CRUISE TOURISM IN LOMÉ

Cruise tourism can be exploited as a way to show-

case their culture to various travelers who land on

its shores.

The increasing number of cruise ships docking in

Lomé carry mostly American tourists and have led

to the discovery of the destination.

Areas of interest for tourists docking at the Lomé

port include the Grand Marche, Akodessewa voodoo

market, the national museum and the German

Cathedral.

The government of Togo has the opportunity to

increase cruise passenger traffic through the

development of cruise terminals with capacity to

accommodate cruise vessels of various sizes.

The Lomé seaport may also look into signing

agreements with cruise operators e.g. Royal

Caribbean and Carnival Cruise Lines.

Source: Google Earth; Colliers International, 2016

CRUISE ROUTE EXAMPLE FROM CAPE TOWN TO ACCRA VIA LOMÉ

Source: Cruise Africa, 2016

KEY AREAS OF INTEREST IN TOGO

Key Facts

Duration: 18 Days

Destinations: 8

Countries

Passengers: 134 pax

Company: G

Adventures

Distance: Approx.

3,006nm

6

The Lomé Seaport will play a crucial

role in channeling inbound corporate

guests visiting for business transactions

within the port as well as cruise

tourists looking to experience the local

culture and attractions that Togo has to

offer

Luderitz

Lobito

Pointe-Noire

Sãu Tomé and Principe

CotonouLome

Accra

Cape Town

Walvis Bay

LOME II

GULF OF GUINEA

N2

N2LOME

CENTRE

GHANA

LOME SEA

PORT

AKODESSEWA

GRANDE

MARCHE

CANAL

N

ES

W

GNASSINGBE

EYADEMA AIRPORT

15MIN TO BENIN

Corporate

Demand Generators

Future Demand Generators

Transport

Hub

Road

Points of

Interest

Border

LOMÉ SEAPORT

Key Demand Generator


• Togo is a preferred location for seminars and conferences organized by both African and International bodies.

• Togo ranks as the most secure and politically stable of its West African counterparts.

• Boasting the only deep sea port in the entire Western African region the processing capacity stood at 1.5 million Twenty-foot Equivalent Units (TEU) in 2015.

• Togo and its neighboring countries have a large

Generation Y population that will be a key market for

hotel operators .

• A hotel classification will be enforced and will result in the strengthening of the hospitality market particularly in Lomé II.

• The Société Aéroportuaire de Lomé Tokoin (SALT) is close to signing deals with new international carriers namely Air Egypt, Kenya Airways etc.

• Although not prevalent in Togo, Ebola is seen as a significant threat causing apprehension in the international community. Tourism recorded slower growth numbers in 2014 as a result of the presence of the disease in some African countries.

• Threat of high competition from other West African countries such as Benin and Ivory Coast, which attract a large number of leisure tourists.

• Under-developed infrastructure (e.g. roads) limits the growth of travel and tourism.

• Togo has not applied any official hotel classification criteria, hence, there is no clear definition of the star rating of hotels.

• There are very few quality hotels servicing the Togo market, most of which are in a state of disrepair and are poorly managed.

SWOT

STRENGTHS WEAKNESSES

OPPORTUNITIES THREATS

Source: Colliers International, 2016

GENERATION Y HOTEL CONSUMER INSIGHTS

growth. Hotels focusing on Generation Y feature

contemporary designs with focus on technology and

social space.

Gen Y Hotel brands also make use of social media and

online travel platforms to market themselves to their

tech savvy consumers.

African consumer trends are changing fast as the

middle class grows and buyers become more

sophisticated.

Togo currently has a strong MICE appeal and Gen Y

brands entering the market should provide facilities

that cater to this segment.

AFRICAN CONSUMER TRENDS

• Increased brand awareness

• Adoption of Western buying habits

• Increase in online purchasing

• Value for customer service

• Demand for quality products

INTERNET AND MOBILE PENETRATION IN AFRICA

• 7 in 10 young Africans use social media on phone

• 1 in 5 young Africans have purchased products or

services with their mobile phone

• 97% of the African population will have mobile

subscription by 2017, and 30% will have

smartphone connection

TOGO TOURISM SWOT ANALYSIS

HOTEL MARKETING PLATFORMS FOR GENERATION Y

Togo and its surrounding countries (Ghana, Benin, Ivory Coast & Nigeria) have a large population of Generation Y

and this is a key factor for hospitality investors to consider as they introduce a product for the market.

TAPPING INTO GENERATION Y

7

• Gen Y keen on fitness hence gyms should be furnished with the

latest equipment.

Fitness as a focal point

ATTRIBUTES OF GENERATION Y HOTEL BRANDS

• Sampling cuisines from Togo and the rest of Africa in

restaurants within the hotels.

Afro-fusion cuisine

• Rooftop lounges and lobbies with expansive atriums featuring

to connect with their peers.

Open social areas

• Incorporating local art and design into the look and feel of Gen Y

brands in Togo will generate further interest in customers who

are looking for something unique.

Local art

• Providing essential technology like hotel-wide WiFi coverage for

guests and using minimalistic design language in the

construction of hotels.

Technology & Efficient Design


35%

13%11%11%

10%

9%6% 5%

France / Belgium Benin

Ghana Other West African

Ivory Coast Other

Other European USA



Source: Euromonitor International; Colliers International, 2016

MARKET UPDATES

Lomé has a limited supply of quality hotels (only

1,180 keys) and the rest of the market supply is

still sub-standard.

with a performance above 55% over the past four

years.

The year 2015 saw an 11% increase in occupancy

levels, reaching 62% for the full year. This

increase in demand was driven by seminars,

increased corporate activity, and increased sea

port activities.

Top performers in the market usually have

occupancy levels of about 68-71%. Hotels in Togo

with international affiliations are popular with the

European market as they have better distribution

channels and brand awareness.

Recent hotel openings in Lomé include; Radisson

Blu, Onomo Hotel and the Olodge which is 30km

from the city centre. A notable upcoming property

in Lomé is the 5-star Pefaco Hotel (2018).

DEMAND SEASONALITY

during the summer (averaging at 79%) for both

business and leisure segments due to increased

arrivals from Europe (leisure) and West Africa

(business).

Occupancy then sees a gradual decline in

December, to then reach an average of 47%

during the months of January, February and

December.

GUEST SEGMENTATION AND NATIONALITIES

by French and West African nationals. This is

countries, and its long lasting ties with the French

government.

The majority of demand is represented by the

corporate segment, which is related to a number

of local companies including, Nestle, Eco Bank,

World Bank, and insurance companies who sign

corporate contracts with hotels.

Corporate contracts with hotels are expected to

increase as the economy develops, hence, providing a

Togo is also keen on marketing itself as an immersive

cultural and eco-tourism destination on an

international level and was a participant in the

Exhibition of Tourism Madrid (FITUR) in January

2016.

- 2015

Although the quality hospitality supply in Lomé is

relatively small, the future is promising especially

for new entrants thanks to a ramp-up in socio-

economic activity and a workforce which is coming

of age.

8

- 2015

-33%-30%

-24%

-6%

6%

21%18%

23%

17%

6%

17%

-12%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

+/- change in occupancy vs. annual average

High Season

77%

15%

6%

2%

Corporate Transient

Leisure Other

58% 57% 56%

62% 63%

0%

10%

20%

30%

40%

50%

60%

70%

80%

2012 2013 2014 2015 2016(f)

ADR RevPAR Occupancy

Forecast


LOMÉ II SMART CITY

LOME II

A new administrative and financial hub located in the

district of Lomé II is under planning.

The complex will feature 1,000,000m2 of office space,

2,000 individual and community housing units and

100,000 m2 of sport, conference and leisure facilities.

Hotel operators should position themselves

strategically to take advantage of the opportunities

that Lomé II will offer.

LEISURE

The leisure market in Baguida could be developed as

the town has a sandy coastline and could be marketed

as a get-away from the bustling city life.

Kpalimé, Kara, and Sokode could be branded as

ecotourism destination with excursions in the hill

country.

BRANDED HOTEL SUPPLY

There is lack of competition in the high-end hotel

market hence, the prices charged by premium

accommodation facilities will remain high in the

forecasted periods. Hotel operators offering quality

budget hotel products may take advantage of this

situation to fill a gap in the market to service guests

who are price sensitive but keen on having

international standard accommodation.

KEY OPPORTUNITY DRIVERS

Togo has an abundance of ecological attractions

offering extensive bio-diversity in its protected

natural habitats.

The prospect of the new adventures that Togo

may offer is also spurring interest among

prospective tourists.

and phosphate, attract business travelers who are

keen on exploiting new opportunities.

Koutammakou, located in the Kara region is a

place of special interest as it is a UNESCO World

Heritage Site.

There is an opportunity for both African and

International Branded Hotels to operate in

Togo especially due to the lack of operators

in the high-end hotel segment and the

provision of quality room products.

9

MARKET OPPORTUNITIES

Source: Colliers International; Google Earth, 2016

COUNTRYWIDE HOSPITALITY OPPORTUNITIES

Atakpame Kara

Sokode Kpalime

Eco-Tourism

Lodges

SOKODE

KARA

ATAKPAME

KPALIME

LOME

LOME II

GULF OF GUINEA

LOME

CENTRE

GHANA

CANAL

COAST

LINE

N

ES

W

GNASSINGBEEYADEMA AIRPORT

3,4 & 5 Star

City Hotels

4 Star Airport

Hotel

4 & 5 Star

Resorts

3 & 4 Star

Lodges

3,4 & 5 Star

City Hotels

The towns north of Lomé present an untapped opportunity

for eco-tourism focused establishments while Lomé centre

is mainly visited for corporate and MICE purposes.

Notably, the towns north of Lomé are underdeveloped and

Lomé centre is in the process of urban redevelopment e.g.

paving of roads.

Developing the Right Asset Type


CONCLUSION: a true market shift is expected to occur in the next 5 - 10 years

• New branded operators enter the market offering various business, leisure and recreational facilities

across various customer tiers as the country shapes itself as the future hub of West Africa.

• The country presents a great opportunity for hospitality investors to make use of the first mover

advantage since the market is still untapped, particularly in the branded hotel segment.

FIR

ST-M

OVER

AD

VA

NTA

GE

GENERATION Y HOTEL BRANDSAs Togo has a large Generation Y population, hotel operators

offering brands focused on this young segment should bring

their product offering to the market.

EXAMPLES OF GENERATION Y HOTEL BRANDS

GENERATION Y HOTEL FACILITIES

Infinity pool Rooftop lounge

Modern Gym

Source: INSEED - TOGO, 2015

MARKET OUTLOOK

Gen Y

24%

76%

DEVELOPMENT AREAS FOR INBOUND TOURISM

Gaming/Casinos Waterparks

Eco-tourism lodges Nightclubs

10

• Theme parks

• Eco-tourism Lodges

• Waterparks etc.

Address Key Market Gaps

• Provision of branded and affordable hotel supply

• Ecotourism in Kpalimé

• Leisure and beach resorts in Baguida and along

the canal

Develop Leisure Tourism

• Nightclubs

• Discos

• Gaming/Casinos

West African Hub

• ASKY airlines has

expansion plans for Europe

and Middle East

• A380 handling

capabilities for newly

expanded airport

• One of the deepestports in West Africa

Shift in the Market

• Regional tourism to

increase in coming years

• Gen Y population is

large and makes up most of

the workforce

• Quality hotel supply is

the new focus

Market Status

• 68% - 71% occupancy levels for top

performing hotels in Lomé

• 2.5 million passengers

forecasted for the new

airport terminal

• 24% growth in RevPar

from 2012 to 2016

Investors should focus on developing both domestic leisure demand and inbound tourism.

Togo Market Snapshot | Hotels | Colliers International

Colliers International Hotels

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The team can advise throughout the key phases and lifecycle of projects

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Our hotels team in the MENA region:

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investment value of valued under asset management

projects advised

About Colliers International

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ensure its accuracy, we cannot guarantee it. No responsibility is assumed for any inaccuracies. Readers are encouraged to consult their

professional advisors prior to acting on any of the material contained in this report.

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