Radisson entry signals shift in Madagascar development
 
Radisson entry signals shift in Madagascar development
19 JUNE 2019 7:49 AM

Radisson Hotel Group is set to open three internationally branded hotels in Madagascar, a country where only one other branded hotel currently exists. Development is fueled by new government, relaxed tourism initiatives, more airlift and a population with growing disposable income.

ANTANANARIVO, Madagascar—Madagascar, the fourth-largest island on the planet, is set to debut its first internationally branded hotels in a decade.

The branded landscape in the country will also more than triple with these three additions, as French hotel firm Accor operates the only existing hotel from a globally active chain, the 174-room Ibis Antananarivo Ankorondrano, which opened in 2009.

Radisson Hospitality Group announced in April it is developing three hotels in the country’s capital, Antananarivo—the 168-room Radisson Blu Antananarivo Waterfront; 56-room Radisson Serviced Apartments Antananarivo City Center, and 30-room Radisson Hotel Antananarivo Waterfront.

Madagascar is a unique country, not technically part of the same geological land mass as mainland Africa. It is known for its unique wildlife, including aye-ayes and lemurs; and its biggest ethnic group, the Merina, originate from Indonesia and Malaysia, according to sources.

Erwan Garnier, Radisson’s director of business development for French- and Portuguese-speaking Africa, said it is his firm’s DNA to go into new markets.

“We got the right local partner with Group Talys, a real estate development and construction company, and we saw that the country had great opportunities,” he said. “We are taking over two operating, non-branded hotels, and one is in construction.”

Typically, opening a hotel in Africa with a developer who owns land but has no hotel experience can take three or four years, Garnier said. But with Talys, Radisson found a partner who already understands hotels, is aligned and is well-connected administratively and politically, he said.

The country’s new government, led by President Andry Rajoelina who was sworn in on 19 January, is considered more relaxed toward tourism initiatives, which is also seen as a plus for development.

Olivier Toboul, CEO of Madagascan destination management company Malagasy Tours and the owner of the 12-chalet Nature Lodge near Diego Suarez in the north of the country, said Rajoelina’s election is part of the process of gaining political stability.

Aina Raveloson Andriamampianina, Talys’s director of development, who before joining the company was in charge of a government project aimed at tourism development funded by The World Bank, said Madagascar historically has been a once-in-a-lifetime tourist destination, with unrivalled natural assets and biodiversity.

“Having said that, the country had faced over the past decades huge constraints that de facto limited the number of visitors,” she said.

Talys already owns the 65-room Tamboho Hotels & Suites in Antananarivo.

“We have not seen yet development, nor economic growth, but it will come. (I am) not sure if it’s because of the new president, but rather the situation that is favourable,” Toboul said. “As soon as Madagascar gets this politic stability, investors will come back.”

Creating a destination
All three Radisson hotels will open in mid-2020, Garnier said.

“Radisson has a good image in the continent, with Radisson Blu its fastest-growing brand,” Garnier said. “In the past years, we’ve opened a hotel every 60 days in Africa, and that has partners interested. We are not the biggest brand yet, but we’re are the one with more design elements and an original style. We see good momentum.”

Demand is expected to come from local and regional business and leisure guests, with Mauritius and France being the main international feeder markets. Both Madagascar and Mauritius have colonial and language connections with France.

Airlift to the country is also growing with a new Dubai-Antananarivo direct flight, and Ethiopian Airlines schedules direct flights three times per week. Kenya Airways and Turkish Airlines also are increasing service.

“The situation is changing, and it will grow fast,” Garnier said. “Madagascar is a very different destination. It’s very much Asian in feel, so the service culture is very high. Apart from that, it is the most beautiful place I have been to in the continent.”

Radisson’s next focus in Madagascar might be the resort destination of Nosy Be, which in the country’s principal language Malagasy means “Big Island,” Garnier said.

Despite the kindness of Malagasy people, their lack of guest-facing experience is a challenge, he said.

Sources said positives include the ability to purchase visas on arrival, improvement in infrastructure and new Minister of Tourism Roland Ratsiraka, who has experience in the sector.

The idea of what a hotel is also is changing in Madagascar, Garnier and Toboul said.

“Hotels like this will be the places to be. Friends and relatives, at the end of the day, will join guests or go on their own to a hotel restaurant or rooftop bar,” Garnier said. Two of the three Radisson hotels will have rooftop bars, a concept he said does not exist in the country.

Raveloson Andriamampianina said the country has suffered from a “poor image (and) ridiculously low marketing budget that partly made the country dependant, sometimes badly, on historical source markets—France mainly.”

“So the challenge was to unlock the country’s potential by addressing constraints,” she said. “This is what the former government—with help from international donors—tried to do.”

Those efforts, she said, have included a new world-class airport due in 2020, the introduction in 2017 of liberal public policies, especially in air access/open-sky agreements and tourism hospitality, and developments in strategic partnerships with national carrier Air Madagascar and upgrading tourist destinations.

Population lift, airlift
A partnership between Air Madagascar and Air Austral reached in July 2018 created domestic air carrier Tsaradia.

Sources also point to the steady growth in Madagascar’s gross domestic product, which at approximately 5.2% to 5.4% annually is higher than the average in sub-Saharan Africa, Raveloson Andriamampianina said.

“The country does have rising middle and upper-middle classes that consume hospitality and leisure products,” she said. “However, the growing economy also favours business tourism, and I assume this is one of the reasons why brands like Radisson, Hilton, Hyatt, Marriott do look closer at, or settle in, our capital Antananarivo.”

She added the country has gained more confidence in selling itself as a destination and diversifying source markets, with marketing increasing in such places as Italy, Northern Europe and Asia, especially China and Japan.

Malagasy Tours’ Toboul said the more hotel companies invest in Madagascar, the more the country’s tourism will grow.

“Hotels are a priority for developing tourism. We need new hotels and new (hotel) companies, because it is also a strong sign that the country is opening and developing,” Toboul said. “Local tourism is almost non-existent. We need flights arriving from other cities than Paris in Europe to increase the number of tourists. It will require hotels to accommodate them.”

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