Kingdom Hotel closes down over lease tenure

Zim Now Writer

African Sun Limited (ASL), Zimbabwe’s largest hotel group has announced that the 294-roomed Kingdom Hotel in Victoria Falls is closing with effect from 5 January next year.

The hotel group announced its pending exit in July, citing its lease tenure with property owner, First Capital Bank (FCB).

In the July notice, ASL said it was hoping to secure at least a10-year lease but the property owner was offering two years.

The hotel has been under the African Sun stable since 1966 and was leased from Makasa Sun (Private) Limited.

African Sun chief executive officer, Peter Saungweme, in a letter dated 24 November, said: “Further to the formal announcement, which African Sun Limited (African Sun) released to the market on 4 July, 2022, we would like to inform you that the Kingdom at Victoria Falls Hotel (“the Hotel”) shall be closing for business with effect from 5 January, 2023,” he said.

The letter is addressed to the Travel Trade Partner, and it adds: “We would like to thank you for your past business and support over the years and look forward to continuing working with you at our other ten hotels, which include the Victoria Falls Hotel and Elephant Hills Resort and Conference Centre, which are also situated in the City of Victoria Falls.”

Africa Sun further said in the July letter that its exit is coming after it had been successful in the 2021 tender for the hotel’s lease.

“However, despite this success, a mutually agreeable lease tenure could not be reached, with the landlord only willing to offer a lease of two years against the group’s ask of a tenure of at least ten years in its tender.

“The ten-year lease tenure was and is still considered as being the minimum the company would need to recoup and realise a return from its envisaged investment in the hotel,” reads the notice.

“The decision to exit the hotel has not been an easy one for the board, but was necessary and unavoidable to protect shareholder value in the circumstances.”