Plans also unveiled for 147-room hotel in Dar es Salaam, Tanzania 

JOHANNESBURG, August 15, 2014….. In another major step forward in its ongoing African expansion initiative, the City Lodge Hotel Group through its wholly owned Kenyan subsidiary, Fairview Hotel Limited, has reached an agreement to develop a 170-room City Lodge Hotel within the upmarket Two Rivers mixed use development that is currently under construction in Nairobi, Kenya.

The group, which already owns the Fairview Hotel and the Country Lodge (to be rebranded to Town Lodge) in Nairobi, has acquired the land for the new hotel on a 99-year long term lease basis and will design, develop, fund and operate the 170-key City Lodge branded hotel. The total cost is expected to be US$23 million. Construction of the hotel is expected to begin in January 2015 with completion scheduled for October 2016. The Two Rivers Mall is currently under construction and is scheduled to open in October 2015. The Two Rivers Mall, when complete, will be the largest mall in Sub-Saharan Africa (excluding South Africa).

Situated in Nairobi’s diplomatic blue zone, the Two Rivers development is the brainchild of Centum, which is East Africa’s largest investment company and is listed on the Nairobi Securities Exchange. Spread across 40 hectares of prime land adjacent to the upmarket residential suburbs of Runda and Rosslyn Estate, it is being designed to become East Africa’s premier destination to meet, do business, live and shop within a master planned urban lifestyle environment.

The Two Rivers development will, once fully developed, comprise 850,000 square metres of office, residential, retail, hotel and entertainment facilities. The building of the City Lodge Hotel will create employment during the construction phase and a number of permanent positions for staff members when the hotel opens to the public.

“We are very excited about this new hotel as it signifies the confidence that we have in expanding our presence in Kenya and East Africa to meet the accommodation needs of business and leisure travellers. This will be the first time that we are developing a green-field hotel in the region, also illustrating our optimism about the prospects for the Two Rivers development and the high profile status and draw-card potential it will have in Nairobi and further afield,” said Clifford Ross, chief executive of the City Lodge Hotel Group.

“Our international business development team has been examining growth opportunities in East Africa for the past couple of years and we believe that this investment will act as a catalyst for other hotel developments we are considering in the region.” Commenting on behalf of Centum, CEO James Mworia said:  “Centum is proud and excited to welcome the City Lodge Hotel Group to its Two Rivers Development. It is notable that this will be the first City Lodge branded hotel outside Southern Africa, and this marks a great achievement not only for Centum but for Nairobi and Kenya.”  Mworia added that the entry of the City Lodge Hotel Group into the Two Rivers Development is further testament to the ability of Centum to attract international investors into the region. He noted that the vision of the Two Rivers development was for it to be a world class destination and attract leading global retail brands. To this end, in addition to City Lodge Hotel Group, Centum had attracted Carrefour, the 4th largest retail chain in the world, to be an anchor tenant in the Two Rivers Mall.

Negotiations are at advanced stages with other international retailers who have expressed an interest in building their presence in this region with the Two Rivers development being their entry point. Centum seeks to be Africa's foremost investment channel providing investors with access to a portfolio of otherwise inaccessible, quality and diversified investments in Financial Services,  Real Estate, FMCG,  Agriculture,  Energy,  Healthcare,  Education and ICT sectors.  As at March 31, 2014, Centum had KES 30 Billion (US$ 340 million) of its own assets under management and KES 120 Billion (US$ 1.36 billion) of third party assets under management.

Meanwhile, the City Lodge Hotel Group has also reached a land-lease agreement in the Ilala Municipal District of Dar es Salaam, the capital of Tanzania, on which it plans to develop, at its own cost, a 147-room City Lodge Hotel. This development, which is subject to the issue of regulatory permits and approvals, is expected to cost around $22 million, with ground-breaking anticipated to take place in the first quarter of 2015.     

The City Lodge Hotel Group acquired a 50% stake in the Fairview Hotel and the Country Lodge in 2012 and in May this year gained full ownership of the two Nairobi hotels as a springboard for further expansion across the East African region. The group’s other non-South African hotel is Town Lodge Gaborone in Botswana which was developed from scratch and opened in early 2013. With 51 hotels in South Africa across the Courtyard Hotel, City Lodge Hotel, Town Lodge and Road Lodge brands, and three hotels in Kenya and Botswana, the group is expanding its footprint into selected parts of East and Southern Africa. It is currently investigating opportunities in Kenya, Uganda, Tanzania, Rwanda, Namibia, Zambia, Mozambique, Mauritius and South Africa.