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Tsogo Sun Holdings Ltd. is building a desalination plant that will help supply its Cape Town hotels with their own water, shielding guests of South Africa’s biggest hotel and casino operator from the city’s deepening water crisis.
The alternative source should be in operation for properties including the five-star Westin by early March at the latest, Tsogo Chief Operating Officer Ravi Nadasen told reporters in Johannesburg on Wednesday. That’s comfortably ahead of the scheduled May 11 date for so-called Day Zero, when city authorities threaten to turn off the taps to residential suburbs.
“There is a plan in place that all of the alternative water sources will come on board before Day Zero comes,” Nadasen said. “The current situation in Cape Town is going to become the new normal. We’ve got to be responsible as well.”
While hotels are bracing themselves for the possibility of Day Zero, Africa’s biggest tourist destination is trying to keep water running as long as possible after a three-year drought all but exhausted local reservoirs. Cape Town’s 4 million citizens have been urged to use as little as possible, with the daily allocation set at 50 liters (13 gallons) per person, and hotels have removed bath plugs and urged visitors to keep toilet flushing to a minimum.
Day Zero won’t apply everywhere, and the city is working to ensure that water continues to flow in areas with a high concentration of jobs, Tim Harris, chief executive officer of city tourism and trade promotion agency Wesgro, said at the same presentation. Those “business protection zones” will also cover the location of many major hotels, he said. The exact areas are due to be announced in two weeks.
About 1.6 million tourists visit the Cape Town area per year and spend about 40 billion rand ($3.3 billion), according to South African Tourism. Cooperation between industry and government can ensure the tourism economy remains robust, the industry body’s CEO, Sisa Ntshona, told reporters.
“South Africa cannot afford to lose confidence as a tourist destination,” he said.
Tsogo shares fell 0.1 percent to 24.60 rand as of 12:30 p.m. in Johannesburg, valuing the owner of South African casinos including Gold Reef City and Garden Route at 28.2 billion rand.
(Updates with comment from tourism agency in fifth paragraph.)
©2018 Bloomberg L.P.