Radisson Hotel Group is betting on KwaZulu-Natal as the next major market for serviced apartments, as demand grows for flexible accommodation that combines hotel services with residential living.

The global hospitality group, which operates more than 1,500 hotels across over 100 countries through 10 brands, is backing the R750 million ($45.7 million) Radisson Serviced Apartments Umhlanga development near the Gateway Theatre of Shopping.

The project comes as KwaZulu-Natal attracts fresh investment from major hospitality players, including Club Med, Southern Sun, Radisson Blu and Italian luxury brand Tonino Lamborghini, which is partnering with Zimbali Lakes Resort.

Umhlanga becomes investment hotspot

The Radisson-branded development will feature 183 serviced apartments, with the first phase offering 40 units to investors from Aug. 15, 2026. The project is expected to open in 2029.

Prices start at R1.75 million ($106,775) for a 29-square-metre studio apartment and R2.41 million ($147,045) for a 39-square-metre one-bedroom unit featuring an open-plan living, dining and kitchen area.

The sectional title apartments, which do not attract transfer duty on acquisition, are expected to deliver an average yield of 12.7% by the fifth year.

Andrew McLachlan, founder of Develop Hotels Inc., has been appointed hotel development adviser by Avoca Developments. He brings more than 35 years of hospitality experience, including senior roles with Radisson Hotel Group and involvement in projects across more than 40 countries.

“The serviced apartment sector has become one of the fastest-growing areas in global hospitality, outperforming many traditional accommodation categories,” McLachlan said.

He said the model appeals to a wider range of travellers, including corporate guests on extended stays, relocating professionals, families, leisure travellers and digital nomads.

“By combining the comfort and space of a home with hotel services, serviced apartments are suited to changing travel patterns where business and leisure increasingly overlap.”

Serviced apartments reshape travel demand

Chris Horn, director of Avoca Developments, said the company’s decision to partner with Radisson was driven by strong demand and the opportunity to introduce a recognised international brand to the KZN market.

“We have seen the demand for serviced apartments in Cape Town and the Western Cape, and it has been significant. KZN offers lower pricing and remains relatively under-developed,” Horn said.

McLachlan said Umhlanga stands apart from many South African hospitality markets because it benefits from both corporate and leisure demand.

While many destinations rely heavily on weekday business travellers, Umhlanga attracts corporate guests during the week and leisure visitors over weekends, school holidays and long weekends.

“This creates a more balanced year-round trading environment and supports stronger occupancy levels,” he said.

Horn said owners would benefit from a lifestyle investment model, where apartments are managed by Radisson while owners can use their units for up to 30 days annually.

The development will include hotel-style services such as concierge support, housekeeping, restaurants, a rooftop bar, conference facilities and meeting spaces.

Hospitality investment grows

The mixed-use development will also include penthouses to be released later. Its location, about 10 minutes from King Shaka International Airport and five minutes from the beach, places it close to Umhlanga’s business, retail and leisure centres.

Owners will receive Radisson Rewards Gold status, offering access to member rates, travel benefits, room upgrades where available and dining discounts at participating hotels.

The project reflects a broader shift in global hospitality toward branded serviced apartments, as travellers increasingly seek the convenience of hotels with the flexibility of residential accommodation.

For KwaZulu-Natal, the development adds to Umhlanga’s growing reputation as a premium mixed-use destination for business, tourism and property investment.