South Africa-based City Lodge Hotel Group is in its initial process to invest in hotel industry in Uganda regardless of high construction costs.
Clifford Ross, City Lodge Hotel Group chief executive said that the group was still hopeful about opening a hotel in Uganda by the end of next year despite encountering difficulties with the cost for its planned 150 room City Lodge Hotel Kampala.
“The Hotel will be built in Kampala. We are still busy with total cost because the project is not feasible at this stage and cost reductions need to be made. If we don’t make it in Kampala we will have no option but to leave. High building and land cost are rendering projects not feasible.” He said.
The project is in the pipeline although the investors are not yet in any discussion with the Uganda Investment Authority.
The City Lodge Hotel Group already invested in Nairobi where it runs a 120-room Fairview Hotel Nairobi and the 84-room Upper Hill Nairobi Hotel.
Given that the Group has a tradition of locating its facilities amidst lavish perfectly landscaped gardens, a top hotel would typically require not less than five acres of prime land in Kampala City.
Finding that kind of land is very expensive not only because it is not easy to get from one seller but also because real estate has reached almost abnormal prices in Kampala with an acre of prime land going for as much as $1 million.