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Johannesburg - The serious pressure being exerted on the hospitality sector is reflected in an increasing number of hotels having to close their doors and being put on auction. The Garden Route is especially distressed.
The latest victims of the sector’s downturn are the Riviera Coastal Inn & Suite Hotel in Hartenbos, the Diaz Beach Garden Route Boutique Hotel near Mossel Bay and the Boland Park Hotel & Lodge in Mossel Bay.
These hotels, which were developed in 1996 by the Hartkop Group and Stocks Developments, will go under the hammer through Auction Alliance following Hartkorp’s liquidation in May.
According to Auction Alliance, Hennie van Niekerk, the founder of Hartkorp, committed suicide in June.
Auction Alliance chief executive Rael Levitt said the current condition the hotel sector along the Garden Route finds itself in is largely because the region developed too rapidly during the boom.
He said the selling of hotels is unfortunately a sign of the present downturn in the hotel and hospitality industry.
The hotels are being auctioned on September 16 at the Riviera Coastal Inn, together with a residential complex and two commercial properties.
Levitt expects smaller hotel operators or property developers to snap up the hotels and convert them into retirement complexes or dwelling units.
Prospects for the country’s hospitality sector, which has a significant oversupply of rooms, remain sombre for the present. A PwC report indicates that about 9 700 new hotel rooms were brought to the market between 2008 and 2010.
The pressure being experienced by hotel owners countrywide is reflected in the results of the listed Hospitality Property Fund for the year to end-June.
The distribution per combined unit by this fund, which invests exclusively in hotel and hospitality properties, was down 11.4% in the period under review compared with the previous financial year.
Listed property fund Hyprop has also announced that it will close the doors of its five star Grace Hotel in Rosebank at the end of August, as the hotel experienced a net loss in the half year to end-June.
The latest victims of the sector’s downturn are the Riviera Coastal Inn & Suite Hotel in Hartenbos, the Diaz Beach Garden Route Boutique Hotel near Mossel Bay and the Boland Park Hotel & Lodge in Mossel Bay.
These hotels, which were developed in 1996 by the Hartkop Group and Stocks Developments, will go under the hammer through Auction Alliance following Hartkorp’s liquidation in May.
According to Auction Alliance, Hennie van Niekerk, the founder of Hartkorp, committed suicide in June.
Auction Alliance chief executive Rael Levitt said the current condition the hotel sector along the Garden Route finds itself in is largely because the region developed too rapidly during the boom.
He said the selling of hotels is unfortunately a sign of the present downturn in the hotel and hospitality industry.
The hotels are being auctioned on September 16 at the Riviera Coastal Inn, together with a residential complex and two commercial properties.
Levitt expects smaller hotel operators or property developers to snap up the hotels and convert them into retirement complexes or dwelling units.
Prospects for the country’s hospitality sector, which has a significant oversupply of rooms, remain sombre for the present. A PwC report indicates that about 9 700 new hotel rooms were brought to the market between 2008 and 2010.
The pressure being experienced by hotel owners countrywide is reflected in the results of the listed Hospitality Property Fund for the year to end-June.
The distribution per combined unit by this fund, which invests exclusively in hotel and hospitality properties, was down 11.4% in the period under review compared with the previous financial year.
Listed property fund Hyprop has also announced that it will close the doors of its five star Grace Hotel in Rosebank at the end of August, as the hotel experienced a net loss in the half year to end-June.
