Derek Martin
25 Mar 2025
The South African hotel industry in February 2025 showcased a promising trajectory, with national RevPAR rising 13.3%, driven by higher ADRs and slight occupancy gains.
The South African hotel industry delivered a strong performance in February 2025, outperforming the same month in 2024 across key metrics such as occupancy rates, average daily rates (ADR), and revenue per available room (RevPAR). Based on data from STR, a leading hospitality analytics provider, this article explores the national trends, performance by star ratings, and regional variations, highlighting areas of strength and pockets of challenge within the sector. All financial figures are reported in South African Rands (ZAR), with the data drawn from a sample of 235 properties representing 30,416 rooms, out of a census of 431 properties and 53,015 rooms.
National Overview
In February 2025, South African hotels achieved an occupancy rate of 66.0%, up slightly from 64.6% in February 2024—a 2.2% increase. More notably, the ADR climbed by 10.9% to 2,266.90 ZAR from 2,044.87 ZAR, reflecting higher room rates across the board. This combination drove a significant 13.3% rise in RevPAR, reaching 1,497.18 ZAR compared to 1,321.57 ZAR the previous year. The year-to-date (YTD) figures for January and February 2025 reinforce this upward trend, with occupancy at 60.0% (up 1.6% from 59.0%), ADR at 2,262.13 ZAR (up 10.6%), and RevPAR at 1,356.48 ZAR (up 12.4%). These metrics suggest a healthy demand and pricing power in the hospitality sector at the start of 2025.
Performance by Star Rating
Hotels across all star ratings saw gains in RevPAR, though the dynamics differed:
Five-Star Hotels: Despite a 5.3% drop in occupancy to 68.9% from 72.7%, five-star properties leveraged a substantial 16.4% increase in ADR to 4,828.63 ZAR from 4,147.76 ZAR. This resulted in a 10.3% RevPAR increase to 3,326.57 ZAR, demonstrating resilience through higher rates despite fewer occupied rooms.
Four-Star Hotels: The standout performers, four-star hotels, boosted occupancy by 2.9% to 67.8% and ADR by 12.1% to 1,990.41 ZAR. This translated to a robust 15.3% RevPAR growth to 1,349.31 ZAR, the highest among star categories, signaling strong demand and pricing confidence.
Three-Star Hotels: Occupancy rose by 4.7% to 64.2%, with ADR increasing by 8.8% to 1,341.69 ZAR. RevPAR followed suit, up 13.9% to 861.87 ZAR, reflecting solid performance in the mid-tier segment.
These results indicate that while occupancy trends varied, significant ADR increases across all categories drove revenue growth, with four-star hotels leading the charge.
Regional Analysis
Performance across South Africa’s provinces revealed stark contrasts, with some regions excelling and others facing challenges:
Western Cape: A Powerhouse of Growth
The Western Cape emerged as a leader, with occupancy rising to 82.7% from 81.3% and ADR surging by 19.0% to 3,804.42 ZAR. This propelled RevPAR up by 21.1% to 3,146.37 ZAR. Cape Town, a key driver, saw even stronger gains: occupancy increased by 3.6% to 83.5%, ADR by 21.1% to 4,517.89 ZAR, and RevPAR by an impressive 25.4% to 3,772.94 ZAR. Within Cape Town:
Five-Star: Occupancy up 3.9% to 80.9%, ADR up 24.1% to 7,962.38 ZAR, RevPAR up 28.9% to 6,438.18 ZAR.
Four-Star: Occupancy up 4.5% to 85.2%, ADR up 23.2% to 3,141.09 ZAR, RevPAR up 28.7% to 2,675.56 ZAR.
Three-Star: Occupancy dipped slightly to 85.2%, but ADR rose 11.4% to 1,869.72 ZAR, lifting RevPAR by 9.8% to 1,592.13 ZAR.
Other areas like the Winelands (RevPAR up 6.6% to 2,835.24 ZAR) and Garden Route (RevPAR up 5.4% to 1,537.16 ZAR) also grew, despite occupancy declines, thanks to higher rates.
Gauteng: Steady Progress
Gauteng reported a 5.5% occupancy increase to 59.9% and an 8.2% ADR rise to 1,446.52 ZAR, yielding a 14.1% RevPAR gain to 866.72 ZAR. Key areas included:
Sandton: RevPAR up 13.8% to 946.84 ZAR, with three-star hotels jumping 24.8% to 510.19 ZAR due to a 19.2% occupancy surge.
Johannesburg: RevPAR soared 20.3% to 726.52 ZAR, driven by a 12.4% occupancy increase.
Pretoria & Surroundings: RevPAR rose 12.4% to 720.30 ZAR, supported by a 7.9% occupancy gain.
KwaZulu Natal: Mixed Results
KwaZulu Natal underperformed, with occupancy falling 3.9% to 55.4% and ADR dipping 1.0% to 1,265.00 ZAR, resulting in a 4.9% RevPAR decline to 700.22 ZAR. The five-star segment was hit hardest, with RevPAR plummeting 39.3% to 1,026.22 ZAR due to a 22.3% occupancy drop and 21.8% ADR decrease. However, four-star hotels defied the trend, with RevPAR up 12.4% to 708.67 ZAR. Specific areas showed:
Durban: RevPAR down 1.4% to 438.57 ZAR, despite an 8.2% ADR increase.
Umhlanga: RevPAR fell 9.6% to 980.87 ZAR, with declines in both occupancy and ADR.
Drakensberg & Midlands: A bright spot, with RevPAR up 17.7% to 671.36 ZAR.
Other Regions
Free State: RevPAR jumped 18.1% to 724.78 ZAR, with a 10.3% occupancy increase.
Limpopo: RevPAR rose 9.7% to 736.36 ZAR, with modest gains in occupancy and ADR.
Eastern Cape: RevPAR increased 12.9% to 749.36 ZAR, led by a 7.8% occupancy rise.
North West: RevPAR grew 5.4% to 1,305.31 ZAR, with small increases in both metrics.
Mpumalanga: RevPAR edged up 1.1% to 536.47 ZAR, despite a slight occupancy drop.
Note: Data for the Northern Cape was insufficient for detailed analysis.
The South African hotel industry in February 2025 showcased a promising trajectory, with national RevPAR rising 13.3%, driven by higher ADRs and slight occupancy gains. Four-star hotels excelled, while regions like the Western Cape, particularly Cape Town, and Gauteng fuelled significant growth. However, KwaZulu Natal’s struggles, especially in the luxury segment, highlight uneven recovery across the country. As the year unfolds, these trends suggest a strengthening hospitality sector, though further research could uncover the drivers behind regional disparities, ensuring sustained progress in this vital economic contributor.