The South African hotel industry achieved strong performance in February 2025, surpassing the same month in 2024 with key metrics such as occupancy rate, average daily rates (ADR), and revenue per room available (RevPar). Based on data from STR, the leading hospitality analytics provider, this article explores national trends, star rating performance, and regional variations, highlighting areas of strength and pockets of challenge within the sector. All financial numbers are reported in the South African Rand (ZAR) and are drawn from a sample of 235 properties representing 431 properties and 30,416 rooms from the 53,015 rooms census.
National overview
In February 2025, hotels in South Africa achieved an occupancy of 66.0%, up 2.2%, a slight increase from 64.6% in February 2024. In particular, the ADR is 2,266.90 ZAR, up 10.9% from 2,044.87 ZAR, reflecting the overall room rate. This combination significantly increased RevPAR, reaching 1,497.18 ZAR compared to the previous year's 1,321.57 ZAR. The annual (YTD) figures for January and February 2025 strengthened this upward trend, with occupancy rates of 60.0% (up 1.6% from 59.0%), ADR of 2,262.13 ZAR (up 10.6%), and RevPAR of 1,356.48 ZAR (up 12.4%). These indicators suggest healthy demand and pricing power in the hospitality sector at the beginning of 2025.
Performance by star rating
The dynamics were different, but all star rating hotels benefited from RevPar:
Five-Star Hotels: Despite the 5.3% occupancy dropping from 72.7% to 68.9%, the 5-star property saw a significant 16.4% increase in ADR from 4,147.76 ZAR to 4,828.63 ZAR. This increased RevPAR by 10.3% to 3,326.57 ZAR, showing resilience at a higher rate despite the fewer occupation chambers. Four Star Hotels: Outstanding performers, 4 Star hotels increased their occupancy rate from 2.9% to 67.8% and ADR from 12.1% to 1,990.41 ZAR. This translates to robust 15.3% RevPAR growth at 1,349.31 ZAR, showing strong demand and pricing confidence. 3-star hotel: Occupancy increased by 4.7% to 64.2%, while ADR increased by 8.8% to 1,341.69 ZAR. RevPAR follows suit, up 13.9% at 861.87 ZAR, reflecting solid performance in the middle tier segment.
These results show that although the trend in occupancy has changed, a significant increase in ADR in all categories drives revenue growth and 4-star hotels lead in rates.
Regional Analysis
The South African state's performance revealed a harsh contrast. Some areas are excellent, others face challenges.
Western Cape: The Great Growth
The Western Cape emerged as a leader, with occupancy rates rising from 81.3% to 82.7%, while ADR increased by 19.0% to 3,804.42 ZAR. This led to a 21.1% increase in Revpar to drive 3,146.37 ZAR. Cape Town, the main driver, saw even stronger profits. Occupancy rates increased by 3.6% to 83.5%, ADRs reach 4,517.89 ZAR to 21.1%, and RevPar to 3,772.94 ZAR from an impressive 25.4%. Inside Cape Town:
5 stars: Occupancy rates increased by 3.9% to 80.9%, ADR increased by 24.1% to 7,962.38 ZAR, and RevPar increased by 28.9% to 6,438.18 ZAR. 4 stars: Occupancy rates of 4.5% to 85.2%, ADR rises by 23.2% to 3,141.09 ZAR, RevPar rises by 28.7% to 2,675.56 ZAR. 3 stars: Occupancy was submerged in just 85.2%, but ADR rose 11.4% to 1,869.72 ZAR, lifting RevPAR from 9.8% to 1,592.13 ZAR.
Other areas such as Wineland (up 6.6% to 2,835.24 ZAR) and Garden Route (up 5.4% to 1,537.16 ZAR) also increased despite lower occupancy thanks to higher rates.
Gauteng: Steady progress
Gauteng reported that the occupancy rate at 5.5% increased to 59.9%, an ADR of 8.2% increased to 1,446.52 ZAR, and a RevPAR gain of 14.1% occurred at 866.72 ZAR. Important areas included:
Sandton: RevPar jumps 13.8% to 946.84 ZAR, while 3-star hotels jump from 24.8% to 510.19 ZAR due to a surge in occupancy of 19.2%. Johannesburg: RevPAR spiked from 20.3% to 726.52 ZAR driven by an increase in occupancy of 12.4%. Pretoria & Anruirstings: RevPar rose 12.4% to 720.30 ZAR, supporting an occupancy of 7.9%.
Kwazulu Natal: Mixed Results
Kwazulu Natal performed poorly, with occupancy dropping by 3.9% to 55.4%, ADR soaking 1.0% in 1,265.00 ZAR, with 4.9% RevPAR reduced to 700.22 ZAR. The five-star segment hit the hardest, with RevPar plunging from 39.3% to 1,026.22 ZAR due to a 22.3% occupancy and a 21.8% ADR drop. However, the four-star hotels contradict this trend, with RevPar increasing by 12.4% to 708.67 ZAR. A specific area indicates:
Durban: revpar to 438.57 ZAR, despite an 8.2% increase in ADR. Umhlanga: RevPar fell 9.6% to 980.87 ZAR, with both occupancy and ADR down. Drakensberg & Midlands: Bright location, RevPar increased by 17.7% to 671.36 ZAR.
Other regions
Free State: RevPAR jumped to 18.1% to 724.78 ZAR, with occupancy rate increased by 10.3%. Limpopo: RevPar rose 9.7% to 736.36 ZAR, with slightly increased occupancy and ADR. Eastern Cape: RevPAR rose 12.9% to 749.36 ZAR, with an increase in occupancy of 7.8%. Northwest: RevPar increased by 5.4% to 1,305.31 ZAR, with both metrics slightly increasing. Mpumalanga: RevPar rose 1.1% to 536.47 ZAR despite a small occupancy.
Note: The Northern Cape data were insufficient for a detailed analysis.
The South African hotel industry in February 2025 presented a promising trajectory, with national RevPAR rising 13.3%, driven by a higher ADR and a small occupancy. The 4-star hotel was excellent, but the Western Cape, especially the regions like Cape Town and Gauteng, have promoted significant growth. However, KwaZulu-Natal's struggle, particularly in the luxury segment, underscores an uneven recovery across the country. As the year unfolds, these trends suggest strengthening the hospitality sector, but further research can uncover the drivers behind regional disparities and ensure the sustained progress of this important economic contributor.
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