Hotel & Lodging Services Development News

• Sunshine Construction Plc will invest over 250 million birr in Marriot Executive Apartment
• the investment layout for the Courtyard Marriott is projected to hit 200 million

After delays lasting several months (months, I thought it was years), Sunshine Construction is close to seal a franchise agreement involving the management of what will become the first Marriott apartment and courtyard hotels in Ethiopia to be built and owned by Sunshine Construction Plc. The company is expected to sign an agreement with Marriott in two months’ time, according to sources.

Marriot International will manage the five-star executive apartment hotel, Marriot Executive Apartment, whose construction is being completed by Sunshine Construction Plc. In addition to the hotel apartment located opposite Estifanos Church off Meskel Square, Sunshine will construct a four-star hotel resort, Courtyard Marriot, around Bole Medhanialem area.

Courtyard Marriot will be constructed on a 4,000 sq.m. plot of land the construction company secured from the Addis Ababa City Administration’s lease office last year.

read the rest @ Reporter

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Skyliner123 said:

Access Real Estate is much better than Sunshine

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Skyliner123 said:

Access Real Estate is much better than Sunshine

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Vildana said:

I am a bit skeptical about Accsess .they didnt deliver a single apt.Didnt finish any project,where as sunshine did a lot when it comes to delivery and doing it on time.talked to access sales dept. gave me lame answers when i asked them about project initiation and delivery .I heard Acsess is turning their attention to south sudan ,sold a lot but poor on project delivery, any way beware!
By the way Sunshine is having problem too , specially with Addis admns.something related to landgrab.

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Vildana said:

I am a bit skeptical about Accsess .they didnt deliver a single apt.Didnt finish any project,where as sunshine did a lot when it comes to delivery and doing it on time.talked to access sales dept. gave me lame answers when i asked them about project initiation and delivery .I heard Acsess is turning their attention to south sudan ,sold a lot but poor on project delivery, any way beware! By the way Sunshine is having problem too , specially with Addis admns.something related to landgrab.

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Roha said:

Please check their website, there is a new message from the CEO, it seems the problem they had is beyond their control. I think access is better than sunshine in every way, It is just the stupid city administration who is making the problems.

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By William Davison - May 10, 2012 12:29 PM ET
Marriot International Inc. (MAR) will manage two hotels that are under construction in Ethiopia’s capital, Addis Ababa, as the company expands in the region, said Alex Kyriakidis, the company’s Middle East and Africa president.

Bethesda, Maryland-based Marriot’s capital partners are investing $1.3 billion in 13 hotels on the continent, adding to the eight it already manages, he said in an interview in Addis Ababa, at the World Economic Forum on Africa. Marriot is targeting annual revenue growth of 25 percent from Middle East and Africa, said Kyriakidis.

The Marriot Executive Apartments and 209-room Courtyard by Marriot are owned, constructed and financed by Addis Ababa-based Sunshine Construction (Pvt) Ltd., he said. The properties may generate 1 billion Ethiopian birr ($57 million) over the first five years, said Kyriakidis.

The self-catering apartments may be finished in the third quarter of next year, while the Courtyard hotel is scheduled to be completed by early 2015, he said.

Marriot is also focusing on Benin, Gabon, Ghana, Nigeria and Rwanda on the continent, the company said in a statement.

To contact the reporter on this story: William Davison in Addis Ababa via Nairobi at [email protected]

To contact the editor responsible for this story: Antony Sguazzin at [email protected]

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Dubai Based Hotel Operator to Enter Ethiopian Market
April 26, 2012 - HMH, the Dubai-based Hospitality Management Holdings, is negotiating with Alsam Group, one of the high-profile retailers and investors in the country, accoridng to the Reporter.

With a portfolio of four international hotel brands and over fifty hotels across the Middle East and Africa, HMH top management including the president, Michel Noblet, was here two weeks ago to learn in detail about Alsam Group.

The two parties are negotiating to reach a possible franchise agreement where a hotel set to be built by Alsam Group will be managed by one of the four international brands owned and managed by HMH.

Sabir Argaw, chairman of Alsam Group, said that the two parties have yet to hold other meetings to become partners in the future.

The negotiation between the two parties is facilitated by a hotel consultancy firm run by a veteran in the business, Fiseha Asres, former senior management member of Hilton Hotel and general manager of Intercontinental Hotel.

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Addisfortune.com


Published On May 13, 2012


Samuel Tafesse, managing director of Sunshine Construction Plc, has inked a management contract agreement with Marriott International Inc. Tesfalem Waldyes, Special to Fortune, sat down with Samuel at his office, located on Africa Avenue (Bole Road), opposite Flamingo Bar & Restaurant to talk about his recent deal.


Sunshine Brings Largest Hotel Chain Yet

Fortune: Marriot International Inc launched a strategic plan to expand its brand to African countries four years ago. They already have hotels in Egypt, are constructing a hotel in Ghana, and are now coming to Ethiopia. What are their reasons behind their move to Ethiopia?

We are the ones who pushed them to choose Ethiopia. I and Berhanu Bekele, head of our Hotel Development Division, repeatedly requested Marriott to take over our hotel management. The first few times they did not have that much willingness because of [questions over] the availability of market. The [convincing] process took almost four years. After that, investigators came here, assessed the situation, and, then, they told us that they were convinced to move here. Since then, we have been discussing with them about the design and things to meet their standards.

Q: In addition to your negotiations, do they mention any other reasons?

When they came here, they saw the market. As you know, Addis Abeba is the capital of Africa and the seat of the African Union. The city also hosts a number of meetings. After they assessed these, they were interested much more than us and were happy to come here.

Q: The four year-long negotiations were held in various countries. You sat down with the Marriott people in London, Addis Abeba, and twice in Dubai. Did this happen because of the tough negotiating terms?

The negotiations were sort of tough. Our first negotiations were for the Executive Apartments. The apartment hotel only has 110 rooms, and they told us that they cannot come for that. It was not productive for them to manage such a hotel after assigning managers and other staff.

They told us that to mobilise their management staff for a country, a hotel should have a minimum of 300 rooms. So, we had to build one additional hotel.

Therefore we requested land to build the Courtyard from the municipality. The process of getting permission [for construction], clearing the site, preparing the title deeds, and doing the preliminary design took lots of time.

That is why it is late.

Q: Before Marriott, you were negotiating with other internationally known hotel chain brands.

There were no such negotiations.

Q: On franchise agreements, there are payments made between the two parties. Sunshine Construction is supposed to pay some amount of money to Marriott and the vice versa. What are your financial arrangements?

Details are elaborated on the contract. For instance, there are a payments for reservation, brand name, and profit. We will pay some amount of money every year for using the brand and for the management. The details remain in the contract, and some of them are confidential. The contract itself has 4,000 pages and took two hours to sign.

Q: What about the procurement procedure? For such arrangements, the company that takes over management will also be responsible for procurement.

When you build such types of hotels, you will choose an interior designer who is recommended by them. Their interior designer will also be there. The designs made by our interior designer should be approved by their interior designer. Then, the procurement will be made. We will do the procurement, and they will approve it.

Q: Other internationally branded hotels have installed their own financial systems after they got permission from the Ethiopian Revenue & Customs Authority (ERCA). What about your hotels? Will they set up their own system or use the systems on the market that are approved by the ERCA?

This will be dealt with after the signing of the contract. Those who have come thus far are responsible for finalising the contract agreement. Other departments that have handled administration issues will continue discussions on this. Staffs from these departments will come after a month and discuss which system is preferable.

We will continue at our convenience.

Q: Several hotels are under construction in Addis Abeba. Some have even started operation. When your two hotels start operation, what value will they add to the hospitality industry?

As you know, international hotels have been coming, recently. The presence of international hotels is essential, especially for foreign tourists and those who come to Addis Abeba for summits or conferences because they are customers of such hotels. Tourists know their websites and check which hotels are available in that country. They make reservations without any hassle.

The second benefit is in terms of revenue and tax for the country. When the two hotels are finished, they will give job opportunities for 650 people. This is not a simple matter in itself.

Q: There was a hotel that used the brand Marriott in Addis Abeba. Will the confusion of names have an effect on you?

No. That hotel was mistakenly opened and already closed now. It has no relation to this one. When we started negotiations with Marriott, they were the ones who followed up and revoked the name. It is easy for anyone to know the [difference in] standards between international and local hotels.

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