The refurbishment of the dilapidated Marasa Umubano Hotel in Kigali will not start until the new investor presents a comprehensive plan to develop the vacant hotel land.
Marasa Africa, a subsidiary of the Madhvani Group, which bought Umubano Hotel early this month, presented a refurbishment proposal of the existing hotel facility but it was rejected by city authorities.
Marasa Africa, a subsidiary of the Madhvani Group, which bought Umubano Hotel early this month, presented a refurbishment proposal of the existing hotel facility but it was rejected by city authorities. In the first phase, the existing facility will be refurbished to meet higher standards.
But, Fred Mugisha, director of Urban Planning and Construction at One Stop Centre, said Madhvani has to present a full concept design of the entire master plan of the plot of land before they approve the rehabilitation of the Umubano Hotel facility.
“We requested Madhvani Group to come up with a new proposal for vacant land. We gave them up to December to present the plan before they are allowed to start rehabilitating the old hotel,” said Mr Mugisha.
The tough stand taken by city authorities means the hotel will remain in its sorry state in a market with high demand for hotel beds.
Data from the Rwanda Development Board (RDB) shows the country currently has a supply of 10,000 beds.
Tour operators say the poor state of Umubano Hotel makes it a hard to market it to tourists despite its strategic location in the city and its rich history.
When Rwanda Today visited the hotel, the outer wall of the over 100-room facility needs a fresh coat of paint to make it attractive to clients who have many options for accommodation in the city.
“The facility is not only dilapidated but definitely requires refurbishment,” said Parasuramn Eswar director of corporate affairs at Madhvani Group.
The tough stand taken by city officials is also in a bid to prevent a repeat of a partnership deal between the Libyan and Rwandan governments, which failed to work.
The two governments formed a joint venture company to manage, operate and develop the Umubano Hotel, but the Libyan government did not invest in the hotel forcing the Rwandan government to repossess it.
Under the deal, the Libyan government, as the majority shareholder, was supposed to rehabilitate the hotel and increase room capacity from the current 134 rooms to 184 rooms.
At the time, it was hoped refurbishing Umubano Hotel would increase bed capacity in Rwanda, at a time when the country had a shortage.
But, currently there is a steady buildup of hotel rooms, which has resulted in price undercutting — a practice that is reducing the profits of hotels in the country.
The turnaround of Marasa hotel is expected to result in job cuts.
While former employees still run the facility, Madhvani group says they will only retain those with needed expertise, a development that has created anxiety in a number of employees.
Madhvani Group’s presence in the region’s hospitality industry is marked by eight properties.
The company owns four properties in Uganda: Silver Back Lodge, Mweya Safari Lodge, Chobe Safari Lodge and Paraa Safari Lodge; and three in Kenya: Aberdare Country Club, The Ark, and Mara Leisure Camp.