Cape Town’s increasing tourist numbers are fuelling a wave of new hotel developments and refurbishments, reflecting more bullish attitudes last seen almost a decade ago.
In 2025, several new hotels have opened or are set to open their doors in Cape Town. Two of these are Marriott properties:
- 90-roomed Morea House, an Autograph Collection hotel, set to open in Camps Bay later this year
- Design-oriented Edition at Quay 7 in the V&A Waterfront with140 rooms and some residences
Canopy by Hilton Cape Town Longkloof, a 154-room inner-city hotel, opened in February and the French hospitality brand Mama Shelter, part of Ennismore, is set to open its first South African property on the site of the relocated Netcare Christiaan Barnard Memorial Hospital later this year.
Several hotels have undergone and continue to undergo refurbishments. The biggest among them, the iconic Table Bay Hotel, is slated to reopen under the InterContinental Hotel brand later this year following an investment of over R1 billion. The Radisson Hotel Group, which has outlined plans to double its hotel footprint in South Africa by 2030, also recently rebranded its Radisson Blu property at the Waterfront to a Radisson Collection Hotel with a slick new look.
Further afield, the Lord Charles Hotel in Somerset West, now a part of Marriott’s Tribute Portfolio, and Spier Hotel have also undergone refurbishments.
These are all in addition to a series of aparthotels, which have opened across the city in recent years following demand for serviced apartments.
Pipeline meets demand
Asked whether the current pipeline is sufficiently aligned with demand, Nils Heckscher, MD and Head of Africa at PKF Hospitality, an international hospitality consultant, said: “For the moment, yes.” But, he added, the city’s hotel supply is known to go through cycles of oversupply and growth.
Recent data, released by SATSA and a number of tourism operators, points to Cape Town enjoying the lion’s share of South Africa’s tourism revenue. Travel Smart Crew data shows that Cape Town and Kruger accounted for over two thirds of the group’s R3.5 billion revenue in 2023. New Frontiers data shows that Cape Town and Kruger accounted for 60% of room nights booked in 2019 and 69% in 2024.
However, according to RoomRaccoon’s 2025 South African Summer Hotel Performance Report, which tracks independent hotel performance between December 2024 and February 2025, across South Africa, occupancy rates fell by six percentage points year on year to 54%. It attributes this, in part, to the competition from short-term rentals and aparthotels in the market. However, average daily rates and revenue per available room both increased.
Keeping up with trends
Heckscher said he believes regulation of short-term rentals will likely increase because of the impact on “how and where we live, and how we can afford to live”. He said a number of hotel brands are starting to introduce similar products, such as apartments and villas, into the market to compete, which South Africa is likely to see more of. Already, Mama Shelter has included 68 branded residences in its Cape Town offering.
Another developing trend is the increase in third-party hotel management and the franchising of global hotel brands. Hotel companies are working closely with consultants and operators, like Cape Town-based Valor Hospitality Partners and others, to identify opportunities, enabling expansion without significant capital investment, Heckscher said.
Beyond Cape Town, there is growing interest in second-tier cities and smaller towns. Groups like The Living Journey Collection have acquired properties in locations such as Franschhoek, Robertson and Hermanus. Stellenbosch, with its shift towards student, senior and co-living models, is also seen as a strong prospect for hospitality-related investment.
Heckscher added that areas like Bellville, Durbanville and George are well positioned to grow as business travel destinations. “You need to look at what the demand generators are and whether they are business- or leisure-driven,” he said.
