In 2015, despite a more positive trend than in previous years, the French hotel industry virtually stagnated in terms of results, according to Deloitte In Extenso. The attacks in Paris in January and November largely penalised establishments in the capital, the sector's traditional powerhouse.
Until November, all was well. Although the terrorist attacks in early January had a negative impact on business in Paris, the French hotel industry was on the right track in 2015 thanks to a number of positive factors, including the fall in oil prices, which stimulated the economy and allowed air fares to fall, renewed growth in Europe, a still favourable euro-dollar exchange rate, and strong seminar and conference business. Unfortunately, the sector was hit hard by the attacks that plunged Paris into mourning at the end of the year. Paris, the usual powerhouse of the entire French hotel industry, was understandably affected by these tragic events. "While the January attacks may have seemed exceptional in the minds of both leisure and business customers, the second wave reminded everyone that the risk of terrorism has not gone away", says Olivier Petit, Partner in Tourism, Culture and the Hotel Industry at In Extenso.
While hoteliers generally maintained their prices in the face of very weak demand, the lower attendance was much higher than in January-February, from -10.9% to -14.6% depending on the category for the month of November, barely offset by the COP 21. All in all, RevPAR over the twelve months of 2015 showed a decline ranging from -1.6% for Paris luxury hotels to -5.5% for mid-range, via -1.4% for top-of-the-range and -3.1% for economy. However, the security risk does not entirely explain the fall in annual results in the capital. The Deloitte study highlights the growing competition from Airbnb and its impact on the mid-range and economy segments. While Aéroports de Paris recorded a marked increase in arrivals in May and between the end of August and the beginning of October, the 2-3 star establishments did not benefit from this surplus of customers.
The setbacks in the Paris hotel industry - which should be qualified, however, since establishments recorded occupancy of more than 70% between 8 and 10 months of the year - explain the virtual stagnation in the results of the French hotel industry in 2015. Whether in the luxury, mid-range or economy segments, performance was broadly unchanged from 2014. Only the top end of the market, helped in particular by an upturn in seminar business and the holding of major conferences, recorded an increase of +1.7% in its average revenue per available room.
"Paris and, to a lesser extent, the Ile-de-France recorded a very sharp decline. On the other hand, performances in the regions remain positive overall, and even very positive for the Côte d'Azur", notes Philippe Gauguier, Partner in Tourism, Culture and Hospitality at In Extenso. Thanks to pleasant weather, the postponement of Ramadan to June and the appeal of Mediterranean destinations, the Côte d'Azur hotel industry recorded a very sharp increase in RevPAR (+14.51TP3Q compared to 2014). Another big winner in 2015, Bordeaux, saw its top-of-the-range hotel sector post a +17% increase, thanks in particular to the arrival ofkey events such as Vinexpo and the ITS World Congresson intelligent transport systems. Like Bordeaux, most of France's major conurbations reported an increase in hotel results in 2015, with the exception of Strasbourg which, like Paris, was penalised by the November attacks, which had a negative impact on attendance at its Christmas market.
Deloitte has also unveiled its forecasts for 2016 and expects a new impetus. The hotel sector should benefit from a favourable environment, with oil prices still very low and the hosting of theEuro 2016 football. Overall, RevPAR is expected to grow by between 1.1% and 2.1% (between +1.4% and +2.4% for the luxury segment; between +1.7% and +2.7% for the high-end segment; between +2% and +3% for the mid-range segment; and between +0.9% and +1.9% for the economy segment).
