Booming hotel business in Lagos

There is a boom in the hotel business in Nigeria at the moment, particularly in Lagos State where the hospitality edifices spring up by the day. In this report, Assistant Life Editor, TERH AGBEDEH, zeroes in on some of these hotels and their owners  

The bandwagon phenomenon is prevalent in Nigeria, perhaps more than anywhere else in the world. It is the reason when one person goes into the hotel business and is seen to make a success of it, most other people want to join in, particularly if they think there is much money to be made.   But most people will agree that it is a travesty when men in government own hotels in a country where many cannot afford to pay school fees.   At the grand opening of InterContinental Lagos Hotel commissioned by the Lagos State Governor, Babatunde Fashola, the architect whose firm designed the towering edifice (Dr. Adeleke Akintilo, the Principal Partner of IAA Associates) said it was true that the reward for hard work is more work. He was referring to the fact that many more jobs have come the way of his company since InterContinental Lagos was built.   It appears that apart from the Nigerian investors like Jim Ovia and Tony Elumelu, who are taking their different corporations into the lucrative hotel business, others may just be in it to find an avenue to invest new money.   The whole hotel drama started with the procurement of the water hotel called Sunburn Yacht in the early days of Fashola’s administration reported to be worth $40 million (about N6.5 billion). On paper, it came as a public-private partnership (PPP) between Lagos State and a bank, which later claimed ownership when the controversy heightened. The floating hotel, formerly owned by Finnish businessman in the United Kingdom, has since disappeared from the Lagos waterways, but not the controversy surrounding hotels.   One such controversy is that associated with the real owners of the plush hotels that dot the Lagos skyline. One of them is said to actually belong to a sitting governor in the South West. The governor, many say, is working very hard to outdo his predecessor when it comes to owning property in the state. There are those, too, who insist that this is the retirement plan for the governor, touted, until recently, as one of the best the country has ever produced.   InterContinental Lagos was originally said to have been possible through a partnership funding by Skye Bank and Wema Bank.   But Ramesh Valechha, Chairman of Milan Group, said last year that the luxurious 23-storey Victoria Island hotel with 352 rooms is fully owned by Milan Group, which has a total of 20 hotels across Africa, with intentions to expand its footprint by 20 per cent in the next five years. There is no doubt that the hotel, which Fashola had described as “a worthy investment that has further closed the gap in the deficit of world-class hospitality infrastructure in the state”, is getting a lot of patronage.   There is indeed no better time to be in the hotel business in the country, if one were to go by the number of hotels springing up daily. In fact, Dr. Akintilo had mentioned at the press conference preceding the launch of InterContinental Lagos that IAA Associates was working on at least seven new hotel projects in Lagos alone.   Perhaps, one of these is the soon-to-be-launched Marriott Hotel Lagos. The person behind this hotel is business mogul, Jim Ovia, who signed a multimillion dollar deal to bring the prestigious Marriott Hotels brand to Nigeria in November 2012. The agreement was signed by Quantum Luxury Properties Limited for which Ovia is chairman, and Marriott Hotels.   “We identified a gap in the marketplace within the hospitality industry to support the burgeoning sectors. Nigeria is well-known for its hospitality and Lagos, as a mega city, deserves a world class facility to complement its status,” Ovia had said.   The former Managing Director of Zenith Bank Plc had said at the signing that the planned five-star hotel would be on the Ozumba Mbadiwe waterfront in Victoria Island, Lagos, and comprise 150 star rooms.   Radisson Blu and Oriental Hotel are already doing business on the same Ozumba Mbadiwe waterfront. The latter is said to be owned by a serving minister, who knows his way around the hotel business, while the former is associated with a former Lagos governor. Of course, the two have not come out to either deny or confirm the report, but what is clear is that the hotel business will get a lift with the huge investments coming in.   One other new investor in the business is the Elumelu-led Transnational Corporation of Nigeria (Transcorp) Plc., which already owns the Transcorp Hilton in Abuja. Only in November last year, Hilton Hotels & Resorts, one of the most recognised names in the industry globally, and Transcorp entered a partnership to develop a new Lagos hotel.   The two are building on successful years of partnership with the Hilton Worldwide. Transcorp, a publicly-quoted conglomerate, announced a new premier hotel development to be sited in the upmarket suburb of Ikoyi, Lagos.   The proposed Transcorp Hilton Lagos is a full service, 350-room hotel on Glover Road, Ikoyi. It will be the Hilton Group’s second hotel in Nigeria by Transcorp, following Transcorp Hilton Hotel Abuja, which is one of the leaders in Hilton’s global network. The new hotel will be jointly owned by Transnational Hotels and Tourism Services Ltd, Transcorp’s hospitality arm, and Heirs Holdings, the pan-African proprietary investment company chaired by Elumelu.   Beyond the empowerment and development of skilled professionals in the hospitality sector, the excited governor noted that the five-star hotel complemented the Lagos mega city vision, and urged more investors to take advantage of the friendly environment the state is offering them to expand their businesses.   Beyond talk about sitting ministers, governors or their predecessors owning such property, the competition is a welcome development just like the jobs created in the industry. Intercontinental Lagos, for instance, has 650 Nigerians in its employ and offers professional training that will ensure new career paths in the hospitality industry and empowerment to Nigerians, among others, who do business with it.