For many years Algeria hosted only a small number of hotels operated by international chains, with options limited to a handful of establishments, even in the capital. However this has been changing in recent years, with a substantial number of branded facilities having been opened in Algiers and beyond, making for a promising outlook in the sector.

French Pioneer

The recent wave of openings arguably began in 2009, when French hotel operator Accor opened its first Ibis-branded facility in the country, in the suburb of Bab Ezzouar near Algiers’ Houari Boumediene Airport. Prior to that the French group already operated a Mercure-branded hotel and a Sofitel in the capital, opened in 2000 and 1992, respectively. Several other internationally branded hotels, such as the Sheraton in Algiers and Hilton, are also present in the country.

However, the Ibis was the first hotel to be opened by Accor under a joint venture known as Société Immobilière et d’Exploitation Hôtelière Algérienne (Sieha) with local company Groupe d’Investisseurs du Maghreb et du Moyen-Orient, founded in 2005, and was followed soon afterwards by further openings by Sieha and other firms.

Since then Sieha opened Ibis-branded establishments in Oran and Tlemcen in 2011, and both an Ibis and a Novotel in Constantine in 2012. The firm’s plans to open 20 hotels across the country appeared to be put on hold after this, but in April 2017 it inaugurated an Ibis and a Novotel on the same site in Sétif, both of which have 120 rooms. Furthermore, Sieha now manages the Royal Hotel in Oran.

Us Expansion

Other chains are also expanding in the country. In January 2017 US operator Marriott announced plans to open the Sheraton Annaba, its seventh establishment in Algeria, in the north-eastern city of the same name.

The 18-floor hotel will have 201 rooms and 1400 sq metres of meeting space. The investor behind the establishment is the local company the Société d’Investissement Hôtelière (SIH).

The US firm, which already operates 1580 rooms across its six other Algerian facilities, has plans to open six more hotels in the country, including a Protea Hotel by Marriott in the eastern city of Constantine, where it already operates a Marriott-branded establishment. Other hotels operated by the firm include three establishments in Oran (a Sheraton, a Four Points by Sheraton and a Le Meridien) and the Sheraton Club des Pins in Algiers.

New Arrivals

Several other major players in the international industry are also entering the market now, as local investors look to foreign operators to manage their facilities. In March 2017 Hyatt announced plans to open its first establishment in Algeria, the Hyatt Regency Algiers Airport at Houari Boumediene Airport, in 2018 in partnership with SIH. The hotel will have 326 rooms and will be connected directly to the airport’s new international terminal (see overview). In April 2017 local media reported that Louvre Hotels was planning to open a 91-room Tulip Inn-branded establishment, also at Houari Boumediene Airport, in the third quarter of the year. The group already operates a Royal Tulipbranded hotel in Skikda in the west of the country.

Carlson Rezidor is also due to open its first hotel in Algeria in April 2018: a 147-room Radisson Blu in the upmarket Hydra area of the capital. The firm first signed a management contract with a local investor for the facility in 2013, but the project has faced delays. The hotel is the first of 30 the firm plans to launch in the country, The firm’s other projects will include 10 Radisson Blu hotels and 20 Park Inn by Radisson establishments.

“We have decided to make Algeria our beachhead in our African expansion strategy,” Malek Baiche, Maghreb development director at Carlson Rezidor told OBG, describing the market as having real potential. The firm has already signed a management contract with the investor behind its Algiers establishment for another Radisson Blu in Tipaza, which will have 250 rooms. Baiche told OBG that construction work on the hotel is due to begin in February 2018, and that such projects typically took around two years to launch once building work had started. The firm has also signed a preliminary agreement with the same investor for seven other establishments, and speaking in October 2017, Baiche told OBG that the company had six or seven other projects in the pipeline that were close to being finalised, with others under discussion.

“Only around 10% of hotel rooms in Algeria are up to international norms and international firms are all realising that there is a gap in the market,” Baiche told OBG, explaining the hotel industry’s recent surge in activity. He added that under Carlson Rezidor’s most conservative forecasts, the market requires a further 240,000 hotel beds – about two and a half times its existing capacity – with the additional beds mainly needed for business travellers. Hotel operators benefit from the fact that they are not constrained by rules limiting foreign companies to a maximum 49% ownership stake in Algerian entities, as generally they are not – with some exceptions – investing in the hotel themselves.

Management Potential

The state-owned hotel segment could provide further opportunities for international operators. The government-owned Hôtellerie Tourisme et Thermalisme Group (Groupe HTT), which operates 70 hotels, spas and resorts (see overview and interview), is currently undertaking an AD70bn (€580.6m) renovation and expansion of its facilities, due to be completed in 2018. Lazhar Bounafaa, Groupe HTT CEO, told OBG that putting some of its facilities under the management of international firms will be a key element of its plans to boost visitor numbers once works are complete.

Upmarket Growth

A boost in activity by foreign operators has helped to drive an increase in capacity at the higher end of the hospitality market. The number of five-star hotels in the country jumped from eight in 2015 to 13 in 2016, with the number of beds in the category rising by 59% to 6734, according to figures from the National Statistics Office (Office Nationale des Statistiques, ONS). The number of four-star hotels doubled to 12 over the same period, with bed numbers increasing by 56% to 1810. The three-star hotel segment also saw a strong growth in numbers, increasing from 39 hotels in 2015 to 51 in 2016, with bed numbers up 21%, reaching 7045.

By contrast, the number of hotels operating in each of the no-star, one-star and two-star categories remained unchanged, with bed capacity also stable or – in the case of the two-star market – falling slightly, while the number of hotels awaiting classification in the segment rose only slightly.

Developing A Workforce

One of the principle rationales for developing tourism in Algeria is that it holds strong potential for job creation, particularly in a country that has high levels of youth unemployment. The sector is also an attractive one to young Algerians due to its positive prospects. “There is a strong desire amongst Algerians to enter the hotel industry, as long as there are real opportunities for career progression,” Baiche told OBG.

However, as the sector is currently under-developed, there will be a need for large-scale training programmes to ensure the availability of a skilled labour force that is able to provide high levels of service in the country’s accommodation market.

“The concept of service isn’t really well established among people seeking to enter the industry,” said Baiche, emphasising the need for such training. However he said there was a will to improve, and that the issue was not a major problem, as operators would be able to provide training where needed. Baiche also added that Carlson Rezidor was looking at establishing partnerships with local educational institutions to create such training programmes.


Bounafaa told OBG that such training was also a priority of Groupe HTT. “Given the importance of human capital and the major role it will play in revitalising our various activities, the group has decided to prioritise staff training as a key element of our medium- and long-term strategy,” he said, adding that Groupe HTT too was also looking to develop training and education partnerships between the public and private sectors.

In September 2017 Groupe HTT signed an agreement with the National Apprenticeship and Continuing Training Development Fund which is part of the Ministry for Training and Professional Education. The agreement establishes a programme that will train instructors for apprentices working for Groupe HTT – which is roughly 3000 employees – in 14 key areas of activity in the tourism, hotel and spa sector, including cooking and restaurant services, human resources, as well as reception and hospitality roles.