Hilton set to double its Egypt portfolio despite constant unrest

More developers, like Hilton, are taking advantage of the increasing demand for hotel rooms in Africa.
Hilton Luxor Resort & Spa

Hilton has planned to double its Egypt hotel portfolio within seven to 10 years as tourism levels rebound to numbers seen before a 2011 uprising. 

Hilton, which runs thousands of hotels worldwide, is also planning to expand its footprint in Morocco while starting new projects in Tunisia and Algeria within the next few years. "We run two hotels in Morocco and there are three others under construction. We're planning to get to 10 in the coming years. We will enter Tunisia with two or three hotels during the next five years, and we will have at least one hotel in Algeria within three years," Mohab Ghali, VP of operations for Egypt and North Africa told Reuters.

According to Ghali, Sharm al-Sheikh and Luxor suffered the most recently although it's too early to determine the full impact the attacks from last month have had on tourist numbers in Hurghada. In the city, an Egyptian man killed two Germans and a Czech with a knife and injured four others in July. The city saw a similar attack on tourists in 2016. "We already have the reservations until September, but of course we'll start seeing the impact, which I don't think will be major...in the coming winter season," he said.

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Egypt has claimed tourism as one of its main sources of foreign currency and provides income for millions of Egyptians. However, the industry has struggled significantly since the uprising. The crash of a Russian plane in 2015 that killed 215 tourists also led to some flight bans to Sharm al-Sheikh on the Red Sea, dealing an even harder blow. 

However, Ghali has predicted that occupancy will improve from last years levels, especially in Cairo, Alexandria, Hurghada and Marsa Alam, thanks to the drop in currency making decreasing the price in vacation stays. "We're currently running 17 hotels in Egypt and we're planning to increase that number to 30 hotels in between seven and 10 years," Ghali said.

Ghali said that Egypt is an important destination for Hilton Worldwide. Therefore, none of its Egypt locations have been closed down even during these harsh times. "Egypt is a tourist destination...It's not missing anything. If things remain stable, within the next six months, in the 2018 winter season, we can see pre-2011 numbers returning, with more revenues now because of the devaluation," he said. 

Following the ousting of Muslim Brotherhood President Mohamed Mursi in 2013, violence against security forces has increased. Therefore, the country is currently battling an insurgency against Islamist militants from that region. The more recent attacks targeting Coptic Christians—Egypt's largest minority—and the security forces have spread to other areas of Egypt.