The performance and resilience of South Africa's hotel industry continues to surprise many despite the fact that in 2009 this sector as a whole experienced a decline in SA Rand Revpar (revenue per available room) of 9.8 percent, says Joop Demes, CEO of Pam Golding Hospitality. These statistics are according to the STR Global Hotel Review.

From a regional perspective the Free State was the best performing province with a marginal decline of 2.9 percent in SA Rand Revpar in 2009 compared to 2008, followed by the Eastern Cape with a 4.6 percent decline, Mpumlanga with 8.9 percent, the Western Cape with 9.5 percent, KwaZulu-Natal with 10 percent and Gauteng with 10.8 percent.

Demes points out, however, that it is important to note that 2009 saw a considerable increase in terms of rooms supply right across South Africa, which he estimates to be in the region of 5.6 percent, which includes an increasing number of guesthouses and B and B's as well as the conversion of residential blocks to apartment hotels. This increase directly dilutes the reported SA Revpar figures.

"It is also very relevant and interesting if we compare Southern Africa as a region to the rest of the world and in this regard the STR Global Hotel Review utilises a common currency of US dollars when comparing global regions," he says.

The region referred to as Africa and the Middle East produced the highest global annual US Dollar Revpar during 2009 – a figure which outperformed the Americas with a very material margin of 72.1 percent, Asia Pacific by a considerable 31.2 percent and Europe by 18.4 percent.

Says Demes: "Of note is that the percentage decline for Southern Africa in US Dollar Revpar for 2009 compared to 2008 was approximately half when compared to the percentage decline in both Asia Pacific and Europe. And if one considers the areas that experienced the least decline in US Dollar Revpar in 2009 compared to 2008, Southern Africa and Northern Africa respectively hold position number one and two – this out of the 15 key areas in the world.

"While these observations are extracted from an analysis of the STR Global Hotel Review for 2009, if we consider the rand exchange rate to the dollar at 31 December 2009 compared to the higher rate at 31 December 2008, the result is even more profound as then South Africa as a whole shows no US Dollar Revpar decline in 2009 compared to 2008."

Demes says against a backdrop of some negative comment recently published in regard to the five star hotel market in Cape Town, it is important to consider the overall 2009 performance of this city, which is Africa's most upmarket and successful leisure destination.

"Pam Golding Hospitality's recent survey among the larger, leading and well-branded five star hotels in Cape Town reflects a balanced and fairly stable trading environment, with SA Rand Revpar figures that during 2009 – for some – marginally increased compared to 2008, and for others considered in the survey did not materially decline. At this stage there are definitely no signs of financial distress or cause for alarm for the hotels that we interviewed.

"There are of course, a number of five star hotels - often smaller, newer and perhaps not in the best location – which have experienced a tough 2009. According to the STR Global Hotel Review the average SA Rand Revpar decline for grade 5 hotels in Cape Town in 2009 was 12.8 percent when compared to 2008. However, one must take into consideration the substantial increase in the number of beds available in the Cape Town five star hotel industry – up by approximately 30 percent at the end of 2009 compared to 2008."

But how did Cape Town and Johannesburg, for example, fare in 2009 when compared with the major cities within the region that the STR refers to as the Middle East and Africa, a region which has been outperforming the Americas and Asia by substantial margins and Europe by a comfortable margin? If one compares the US Dollar Revpar percentage change in 2009 with 2008 within the Middle East and Africa, both these South African cities featured in the top five in the 2009 STR Global Hotel Review.

Adds Demes: "On a positive note, while currently and in our view, there is an element of oversupply of rooms in some categories in certain nodes in South Africa, this is strongly balanced by a definite shortage of beds in certain other categories, nodes and locations. Without doubt the foreign appetite for guesthouses and boutique hotels is increasing and we continue to experience an increasing demand for consultancy services, valuations and feasibility studies."