How To Start Accommodation Business In South Africa
What does accommodation in business mean?
What is the meaning / definition of Accommodation in the hospitality industry? The term accommodation refers to a room, building or lodging which provides shelter for a person to stay, sleep and live
Overview of Accommodation in Business
The hotel business, like most other businesses, is cyclical: when the economy improves, new hotel construction activity tends to accelerate with investors looking for opportunities to develop new hotels. This trend is supported by an increase in the advertisements appearing in local newspapers for auctions of hotel sites. The entire process of setting up a new hotel typically takes three to four years and, given the ‘normal’ delays that take place in India, can take even longer. Common questions being asked today are “how much should I pay for the land?” or, “how much is this hotel site worth?”
How To Start Accommodation Business In South Africa
- Step 1: Make a plan
- Step 2: Create your Unique Value Proposition (UVP)
- Step 3: Develop your marketing plan
- Step 4: Enquire about permits and zoning
- Step 5: Raise startup capital
- Step 6: Find hotel premises, build and furnish
- Step 7: Recruit staff
- Step 8: Put systems in place
- Step 9: Train your team
- Step 10: Open your hotel
Applications for registration
(1)A person who is referred to in section 2
(2) and a person who intends conducting a business involving the supply of accommodation at an accommodation establishment shall apply for registration of his business or proposed business to the designated officer in writing on the prescribed form and such application shall be accompanied by—(a)a site plan;
(b)a layout plan of the building or buildings on the premises indicating—
(i)the dimensions and floor area of each room or other distinct part of the premises and the use to which it is to be put;
(ii)the maximum number of persons to be accommodated in each room intended for use as a bedroom as determined in accordance with the provisions of section 13;
(iii)the location of cooking facilities, bathrooms, showers, toilets and laundry facilities;
(iv)the position of lighting and electrical socket outlet points, electric cooking appliances and electric water heaters, if applicable;
(v)the siting of hose reels, fire hydrants and portable fire extinguishers in compliance with the requirements of the National Building Regulations;
(vi)the location of emergency routes provided in accordance with the National Building Regulations for escape from the building in the event of fire, reflecting—(aa)all doors, passages, ramps and stairs which are components of such routes and indicating their widths;(bb)the fire resistance of the elements constituting such components;
(vii)the siting of all sanitary fixtures, which shall comply with the requirements of Part P of the National Building Regulations; and
(c)the prescribed application fee which shall not be refundable;Provided that—
(i)the designated officer may require an applicant to submit such other plans, documents and information as he deems necessary for the purpose of considering any application or a particular application.
(ii)no person may apply for or be granted registration within six months after the cancellation in terms of section 7 or section 18 (3) of registration effected either in his name or in that of a company, close corporation or partnership of which he is or was a member.
(2)The application shall be signed by the person who intends to conduct the business on the premises or his authorised agent and in the case of the latter he shall annex a copy of his authorisation to the prescribed form.
(3)If the applicant is a juristic person the application shall be accompanied by a certified copy of the resolution of the executive body of such person authorising the making of the application.
(4)If the applicant is not the registered owner of the premises, the application shall be accompanied by a certified copy of the lease or other document from which he derives his right to occupy the premises.
(5)The designated officer shall convey his decision on an application made in terms of subsection (1) within 30 days of the date of receipt of the application or within such extended period as may be approved by the Council.
(6)Upon approval of an application, the designated officer shall register the business to which the application relates and issue a registration certificate to the applicant on the prescribed form.
(7)If the designated officer refuses an application, the applicant may within 30 days of the date of the notice conveying such refusal to him, appeal to a committee appointed by the Council for the purpose, such committee to comprise three persons, of whom one—(a)shall be an independent person who is a retired judge of the Supreme Court, a retired magistrate or a person who has practiced as an advocate or attorney for at least 7 years;(b)shall be a councillor; and(c)shall be a person with appropriate knowledge or experience nominated from time to time by the Durban Regional Chamber of Business or, if that body ceases to exist, a body having similar objectives which is approved by the Council;and alternates may be appointed or nominated in each case to act in the absence of a member.
(8)The member referred to in subsection (7) (a) or in his absence his alternate, shall be the chairman of the committee.
(9)A quorum of the committee shall be three.
(10)The members of the committee shall hold office until replaced by the Council or, in the case of the member referred to in subsection (7) (c), until the body referred to in that subsection nominates another person for membership of the Committee.
(11)In granting an application for registration the designated officer or in the case of an appeal in terms of subsection (7), the committee, may impose such limitations, restrictions, terms and conditions as he or it deems fit in furtherance of the aims of these By-laws.
(12)An application may be refused on the grounds that the premises do not comply with the requirements of these By-laws or that the applicant is not a fit and proper person to conduct an accommodation establishment business.
(13)A certificate holder shall within twenty-one days of any such change notify the designated officer of any change in the information reflected in the application submitted by him in terms of subsection (1) or on any plan or in any document submitted therewith.
Frequently Asked Questions (FAQs)
Is running a hotel profitable in South Africa?
Owning a hotel can be profitable if you have the right combination of location, price point, quality of the physical asset, marketing strategy, dedicated employees, and supportive investors and management partners. However, a hotel isn’t profitable by default, so you can expect a lot of hard work to generate profit.
How much does it cost to build a student accommodation in South Africa?
Current pricing to build student housing on campus is estimated at R320 000 per bed, which can increase to R550 000 when taking land costs into account.
How do I start a BNB in South Africa?
Before you start a bed and breakfast venture, your plans must be approved by the Town Planning Department of your local council. If approval is granted, you will need to register the venture and obtain a trading licence from the Licensing Department.
How do I open a lodge in South Africa?
There are various criteria that must be met including the below:
- A proven available investment amount of must be from funds introduced to South Africa from abroad.
- The employment of 60% South Africans.
- A comprehensive business plan.
- An appropriate company structure.
How do guest houses work in South Africa?
If one looks at the definitions, a guesthouse is traditionally a small, privately owned homestead that rents out its rooms at a daily rate. A guesthouse will also have fewer rooms than a hotel, usually anything from 4-10 rooms.
Is student accommodation a good investment in South Africa?
Although some will be able to stay at home, most need a place to live and the demand for accommodation is intense. With a guaranteed supply of tenants each year and an undersupply of quality rental stock, investing in lettable student-orientated property can bring steady, high returns at low risk
Does Nsfas fund Hatfield Studios?
Hatfield Studios is student accommodation located in Prospect Street, Hatfield. It has been accredited through the University of Pretoria, and NSFAS
How big is the hospitality industry in South Africa?
The World Travel and Tourism Council (2018) reported that the contribution of the tourism sector in South Africa resulted in 2.8% of real gross domestic product (GDP), with a total of R139 billion and further projection of R145,3 billion in 2019.
How much land is needed to build a hotel?
Table : Land Values as indicated by the Land Allocation Method
| Average square feet per room required for a Upscale hotel | 750 |
|---|---|
| Total no of rooms | 300 |
| Total area (sq ft) | 225,000 |
| Assuming allowed FSI is 1.5, Land area required at the minimum | 150,000 |
| Development cost per room for a five star deluxe hotel (excluding land) | 5,000,000 |