The French hotel industry largely stalled in 2016, hit by the dramatic security situation and, as in all even-numbered years, an unfavourable events calendar with the absence of the Paris Air Show and Vinexpo in Bordeaux. At national level, according to the figures announced by Deloitte In Extenso, revenue per room (RevPAR) fell by 4.0 1Q3. With the exception of super-economy establishments, which are returning to revenue growth after several years of decline, all categories posted results down sharply on 2015.
This "year to forget" for French hoteliers contrasts with a generally positive trend for their peers elsewhere in the world. For example, Accorhotels, the leading group in France and Europe, recorded a -2.8% decline in sales in France in 2016, out of step with its performances in Asia Pacific (+5.5%), the Americas (+4.7%), Central and Northern Europe (+4.1%) and the Mediterranean Middle East (+3.8%).
For a long time the powerhouse of the French hotel industry, Paris has for once dragged the sector down with it. While the capital lost 1.5 million tourists in 2016, according to figures recently announced by the Ile-de-France Regional Tourism Committee, Parisian establishments recorded very significant falls in their RevPAR, ranging from -9% for urban residences and -13.4% for the economy segment to -21.0% for luxury. This fall can be explained by both the fall in the average price and the decline in the occupancy rate, with occupancy picking up timidly at the end of the year, showing some glimmers of hope for 2017.
Like the capital, the Côte d'Azur posted negative results in 2016, despite an excellent start to the year. Unfortunately, the attack in Nice on 14 July caused a very significant downturn in the second half of the year, with declines ranging from -5.5% for the top end of the market to -8.3% for the economy segment. Only the luxury hotel sector limited the fall to -0.7%.
Outside Paris and the Côte d'Azur, five-star hotels made a major contribution to the good performance of the provincial hotel sector. While all segments of the provincial hotel industry recorded growth - +1.7% for two-star hotels and +3.9% for top-of-the-range hotels, for example - five-star hotels posted almost double-digit growth in revenue per room (+9.6%). Proof that, despite the opening of new hotels in recent years, this growth in supply is not affecting demand - quite the contrary. The Euro football tournament in June partly explains these good results, but the overall trend was positive throughout the year, in Lyon (+6%) as well as in Toulouse and Nantes (+5%), Lille, Rennes and Bordeaux (+3%). In all these cities, establishments reported a joint increase in occupancy rate and average price. Only Nice, for well-known reasons, and Marseille, which is struggling to absorb the new hotels opened in 2013, when the city was European Capital of Culture, stand out with RevPAR declines of -3% and -10% respectively.
For Deloitte In Extenso, 2017 should bring a smile back to hoteliers' faces. The firm is forecasting growth of between +3% and +5% for five-star hotels, between +3.5% and +5.5% for top-of-the-range hotels, between +2.5 and +4.5% for mid-range hotels and between +2% and +4% for budget hotels. Deloitte is forecasting these results on the strength of a number of factors, including a favourable calendar of events and buoyant seminar activity. "The bottom of the cycle is behind us", says partner Olivier Petit. Unless...
