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EGYPT TOURISM AND

HOSPITALITY MARKET
SNAPSHOT 2017

Published by BNC for The Big 5 Construct Egypt

Publication Date: March, 2017
© 2004-2017 Industry Networks (FZC). All rights reserved.
Table of Contents
Introduction 3

Tourism 3

Hospitality 3

Conclusion 5
 Introduction
The Egyptian hospitality and tourism market is showing signs
of recovery in 2017 after experiencing a slowdown 2016. The
construction market in Egypt is also making strong advances
following a heightened period of geopolitical unrest. As per
BNC Project Intelligence, there are over USD 335 billion worth
of active construction projects in Egypt, of which
approximately 5% belong to the hospitality sector. Despite
some growth challenges, the Egyptian government is
investing in tourism and hospitality to diversify economic
activities and create new employment opportunities.

Tourism
Tourism in Egypt is expected to pick up in 2017. Egypt’s Chart 1: Value of Hospitality Projects (USD Billions)
Minister of Tourism, Yehia Rashed, reported that the inflow of at Different Stages of Construction
tourists decreased by 40% to 5.3 million visitors in 2016.¹ The
3.0
decline is primarily due to the regional instability and downing

Project Value in USD Billions

of a Russian aircraft in October 2015, which resulted in Russia, 2.5
along with other European countries, suspending flights to 2.0
Egypt.² Tourism income in Egypt witnessed a 44.3% drop
1.5
between 2015 and 2016.³ State led initiatives and commercial
factors that are driving growth in the tourism sector includes: 1.0

0.5
▪ The Egyptian Tourism Authority, through a
coordinated effort with Egyptian Embassies abroad, 0
Concept Design On Hold Under
aims to target between 700,000 and 800,000 tourists Construction
in South and East Asian, Central European and
Source: BNC Project Intelligence
North African countries.⁴
▪ Russia, along with Finland, Norway, Sweden, and
The hospitality projects spread across different cities in Egypt,
Denmark, has lifted the travel ban on the Sinai
with Cairo having the highest percentage of construction
Peninsula, which is expected to gradually draw in
activities. According to a study published by Colliers
more travelers (Russian tourists alone made up
International, as of 2016, Greater Cairo had 28,000 rooms
approximately 68% of Egypt’s tourists in 2015).⁵
over six districts (6th of October, Pyramids/Giza, Downtown
▪ Major construction activities are currently underway Cairo, Heliopolis, Maadi, and New Cairo).⁷ The development
to attract tourists including the Ritz-Carlton Resort in of new urban areas in Cairo has helped fuel the demand for
Sharm El Sheikh and the Jumeirah Gamsha Bay hotels and resorts in the city to attract local tourists.⁸
Resort (Palm Gamsha) in Hurghada (Hurghada is
expecting 1,000 additional rooms by 2017).⁶
Chart 2: Percentage of Active Hospitality Projects per
City in Egypt
Hospitality 6% 8%

17%
The Egyptian hospitality sector supports tourism by offering 29%
an uncommon luxury experience at affordable prices. There is
a healthy pipeline of new hospitality projects that are expected
to come on stream in the next few years. As per the BNC 12%
Project Intelligence, there are approximately USD 5.3 billion
10% 2%
worth of hospitality projects in Egypt, of which nearly 70% are
17%
in the initial stages of construction (i.e. concept and design). It
is also noteworthy to mention that only 14% of hospitality
project values are on hold indicating a strong flow-through of
project investments that are still advancing in the country.

Source: BNC Project Intelligence

1-8 Media 3
Table 1: Select High-Value Projects in Egypt

Estimated Value in Estimated Completion

Project Name City Stage
USD Millions Date

Hayat Alex Park (Phase 1) 124 Million Alexandria Under Construction Dec-19

The Address Hotel 300 Million Cairo Design Oct-19

SECON Hotel 50 Million Damietta Design Dec-18

Tropicana Splash Resort 100 Million Hurghada Concept Dec-19

The Address Resort Marassi 150 Million Matrouh Concept Dec-18

Four Seasons Hotel 100 Million New Cairo Concept Dec-19

Fairmont Citystars 120 Million Sharm Al Sheikh Concept Dec-19

DoubleTree
Table byBank
1: World HiltonEase of Doing Business
85 Million
Report 2017 Suez Concept Sep-20

Source: BNC Project Intelligence

There is a growing market for branded hotels offering a Chart 3: 2016 Occupancy and RevPAR (in USD) for
world-class service.⁹ Major cities such as Cairo is expected to Four Major Cities in Egypt
offer 15,652 branded hotel rooms in 2016, including the
180 80%
Ritz-Carlton (245 rooms) and the Royal Maxim Kempinski (331 160 $154 71%
70%
rooms).¹⁰ The forecasted 2016 supply of branded hotels in 140
61% 60%
other major areas include Sharm El Sheikh (18,920 rooms), 120
50%
Hurghada (13,511 rooms), and Alexandria (2,161).¹¹ The 100
40%
hospitality sector has under performed in the past year with 80 30% 31%
$60 30%
an average occupancy rate of 48% in these four major cities 60
40 20%
(Cairo, Sharm El Sheikh, Hurghada, and Alexandria).¹² Among $19
20 $15 10%
the four cities, Alexandria has the highest occupancy rate of
0 0%
71%, whereas Cairo recorded the highest revenue per Sharm El Hurghada Cairo Alexandria
available room (RevPAR) of USD 154.¹³ Tourism is expected Sheikh
to pick up in 2017 and is likely to create new demand for the
new hotels and resorts scheduled for completion in the near Source: BNC Project Intelligence
future.

9-13 Media 4
 Conclusion
Owing to state led initiatives and political stability in the
country, the Egyptian hospitality and tourism market is
showing signs of growth in 2017. The Egyptian government
has been working to improve bilateral relations, which could
present opportunities in different sectors including hospitality
and tourism. There are also several major hospitality projects
that are expected to come on stream in the near future to
help boost tourism.

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