CityBlue Hotels announces branded coastal residence projects in Diani Beach and Watamu, expanding Kenya portfolio

CityBlue Hotels announced in early April 2026 plans to develop branded coastal residential projects in Diani Beach and Watamu in Kenya, aiming to expand its footprint in key tourism destinations while catering to growing demand for integrated hospitality-led residential offerings, the company said in an official statement.

Projects announced in coastal Kenya

The company confirmed that the developments will be located in Diani Beach and Watamu, two of Kenya’s prominent coastal tourism hubs. Officials said the projects are part of CityBlue Hotels’ strategy to expand beyond traditional hotel operations into branded residential formats.

According to the company, both locations were selected due to their established tourism appeal, accessibility and increasing interest from domestic and international investors. The announcement marks a continuation of development activity along Kenya’s coastline.

Development scope and concept

CityBlue Hotels stated that the projects will include residential units integrated with hospitality services, allowing residents access to hotel-managed amenities. The developments are expected to combine accommodation with shared facilities such as dining, recreation and guest services.

While specific details on unit count and investment size were not disclosed, the company indicated that the projects are being designed to meet demand for managed residences in resort destinations. Construction timelines were not provided.

Expansion strategy in Kenya

The company said the announcement aligns with its broader expansion strategy in East Africa, where it has been increasing its presence across multiple markets. Officials noted that Kenya remains a priority due to its established tourism sector and infrastructure.

A company spokesperson said the move reflects changing demand patterns in the hospitality sector. “We are seeing increased interest in hospitality-integrated living spaces, particularly in coastal destinations,” the spokesperson said.

Market context and demand drivers

Diani Beach and Watamu are known for attracting leisure travelers due to their beaches, marine attractions and resort infrastructure. Industry participants said these areas have seen rising interest in real estate linked to tourism.

The introduction of branded residential developments is expected to add to accommodation capacity while offering long-stay options for investors and visitors. Such projects typically combine residential ownership with hotel management services.

Planning and implementation

CityBlue Hotels said it is working with development partners to advance planning and approvals for the projects. The developments will be subject to local regulatory requirements, including zoning and environmental clearances.

Officials added that further project details, including timelines and construction milestones, will be announced as planning progresses. No launch dates have been confirmed for either development.

Current status

As of April 2026, the Diani Beach and Watamu projects remain in the planning stage, with CityBlue Hotels proceeding with development preparations and partner coordination ahead of future construction activity.