Tag: grow

Despit Pandemic, Hotel Chains Grow in Africa

JOHANNESBURG—Africa’s tourism sector has cratered in the face of the coronavirus, but the world’s biggest hotel chains remain committed to the continent.

Major hotel chains, from

Marriott International


MAR 0.71%

to Radisson Hotel Group and Paris-based

Accor,


AC 1.10%

Europe’s largest hotel company, say their African businesses are not only holding up, they are determined to stay on track with, if not grow, their footprints. The companies see sub-Saharan Africa as underserved and underdeveloped in terms of hotels and predict that demand for both business and leisure travel will grow once the pandemic abates.

“I haven’t heard of anybody that says we aren’t interested in Africa anymore,” said Trevor Ward, owner of W Hospitality Group, a Lagos, Nigeria-based advisory firm that works across Africa. “The long-term play is fine.”

Travel restrictions and social-distancing have kept long-haul business and leisure travelers at home, choking a crucial source of revenue for the region. The World Travel and Tourism Council estimates that in a baseline scenario, Africa will lose 10.9 million, or 44%, of its tourism-sector jobs and $75 billion, or 45%, of its tourism income this year. On a percentage basis, that decline is worse than the Asia-Pacific region and the Americas, though not as bad as Europe.

The collapse of many independent hotels due to Covid-19 has heralded a new phase of consolidation in the lodging industry, where big chains are taking over and rebranding distressed properties, leading to faster expansion across Africa, hotel chains and analysts say. That is partly because hotel chains bear little risk or cost when they convert an independent property to their brand, at least compared with building a new property; the converted hotel becomes part of the chain, which collects franchise fees from the hotel’s revenue.

The conversion trend is present across emerging markets, but particularly in sub-Saharan Africa, due to a lack of hotels for business travelers in burgeoning hubs like Addis Ababa, Ethiopia, and Abuja, Nigeria. To be sure, the expansion of hotel chains is just one slice of Africa’s diverse hotel market. Properties outside cities in iconic regions from Zanzibar, Tanzania, to Botswana’s Okavango Delta have also taken a huge hit.

Hilton Worldwide Holdings Inc. Chief Executive Christopher Nassetta called conversions a bright spot for the company during Hilton’s August earnings call, even as the chain suffered an 81% decrease in revenue per available room, or RevPAR,—the key metric for a hotel’s top-line performance, combining room rates with occupancy—during the period.

Andrew McLachlan, managing director of development for sub-Saharan Africa at Hilton, which has 25 operational hotels and 41 hotels under development in the region, says the company’s interest is being sustained partly because the continent’s hospitality sector remains underdeveloped in terms of expected future demand compared with other parts of the world.

“We have quite a robust deal flow at the moment,” said Mr. McLachlan. “Some of my colleagues in other markets are not seeing new deal flow coming in.”

“From a development point of view, [the pandemic has] created

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How to grow your vacation savings while you’re at home in quarantine

  • As the stock market has tumbled, the Fed has slashed interest rates to near zero in an effort to boost the economy.
  • Those cuts have meant that APYs on high-yield savings accounts have plummeted. 
  • If you’ve been saving for a vacation and counting on the interest earned on your cash, you may be wondering if you should move it elsewhere to earn more.
  • For most people, leaving your money alone is the best choice. But if you have a longer timeline, you could put into a high-yield CD, change savings accounts, or even invest it if you won’t need the money for a long time.
  • Find out who has the best high-yield savings account rate right now »

As the stock market has plunged over the last month in response to fears about the coronavirus outbreak, the Fed has slashed interest rates in an effort to boost the economy and get markets moving again.

That may be beneficial for you if you’re looking to borrow money or refinance your mortgage, but if you’ve been counting on the interest earned in your high-yield savings account, the cuts probably weren’t as attractive.

Since banks and financial institutions follow the Fed’s lead, interest rates on high-yield savings accounts have dropped to new lows. If you’ve been socking away cash for your next vacation (whenever that may be) you may be wondering what to do with vacation savings that are suddenly sitting idle in high-yield savings accounts with rapidly dropping rates. 

With much of the country — and the world — in quarantine, it’s hard to know when travel will be feasible again, so what should you do with your funds in the meantime to make the most of that liquid cash? 

There are a few options on the table to make sure you get the most bang for your buck.

Move your funds to a better savings account

With the Fed cutting rates to near-zero, it’s likely that you’re seeing the interest rate on your high-yield savings account (HYSA) follow suit. In January, it wasn’t uncommon to see a 1.90% APY, but just a few months later, many are hovering closer to 1.50% or much lower.

We love an HYSA as a spot to stash vacation savings until you’re ready to use them, so now might be the right moment to look around for one with better rates. 

It is important to note, of course, that interest rates are fickle friends even in the best of times, and with all the uncertainty in the air right now, they’re sure to fluctuate even more. So try not to get in the habit of moving your savings every time you spot a higher interest rate. Do your research, find an institution and an account that works for you, and give your cash a chance to grow uninterrupted.

Consider a CD

A savings account is always a great option for funds you need handy at a moment’s notice, like an emergency fund. But when it comes

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