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French Hotel Industry Performance - April 2015

In Extenso Avocats, a subsidiary of the DELOITTE Group ·16 June 2015
April's results were generally somewhat gloomy. However, a closer look reveals a contrasting hotel landscape. After the brief lull in March, the Capital began to slide again. On the other hand, regional cities benefited from the school holidays, allowing them to record relatively good trading results in April.

French Hotel Industry Performance - March 2015

In Extenso Avocats, a subsidiary of the DELOITTE Group ·20 May 2015
The situation started to pick up a little for the French hotel industry in March. Although hotels did not record exceptional results, March did allow the first trimester to close on a positive note, particularly in Paris. This was especially the case for Budget and Midscale hotels, and to a certain extent, Upscale hotels, too.

French Hotel Industry Performance - January 2015

In Extenso Avocats, a subsidiary of the DELOITTE Group · 9 March 2015
Parisian hotels were hit by the dramatic events at Charlie Hebdo and Porte de Vincennes. Demand dropped, particularly in hotel categories that traditionally welcome a high proportion of overseas guests. However, the decline remained limited and could have been more significant had the destination not been able to rapidly reassure foreign visitors. Further afield, the French hotel industry had a good month, driven by several key destinations with strong MICE business. Parisian hotels were affected by the events at Charlie Hebdo and Porte de Vincennes. Occupancy dropped in January - down 3 to 6% for most categories. The impact was particularly visible in the more prestigious categories - Boutique and Luxury hotels - where the mostly-foreign clientele preferred to postpone travel. Philippe Gauguier, Associate at In Extenso Tourism, Culture & Hospitality, highlights that we could, however, have expected an even steeper decline in the light of the dramatic events. The destination was able to quickly bounce back afterwards and reassure foreign visitors. Furthermore, seminar and congress visitors were still in attendance, as most large-scale business events were not cancelled. Moreover, Upscale hotels were the only ones to record higher RevPAR in Paris. The notable drop in demand in Paris tended to eclipse the rest of the market. However, results are interesting and even encouraging in regional France. Budget to Upscale categories all recorded a strong increase in RevPAR. Occupancy and average rates progressed, signalling strong demand. This was even the case for the Cote d'Azur, even if RevPAR growth was driven by higher occupancy. The only exception was the Luxury segment that recorded a drop in business - both in regional France and on the Cote d'Azur. Overseas visitors - influenced by the events in Paris - most likely wondered whether similar incidents would happen elsewhere in France. Regional trends are, therefore, encouraging. However, Olivier Petit, Associate at In Extenso Tourism, Culture & Hospitality, observes that market growth was primarily driven by several zones, and notably by certain cities. Lille, Lyon and Montpellier thus recorded a significant improvement in activity. These destinations offered a rich events agenda in January, which favoured hotel activity - often the case in odd-numbered years.

Deloitte - French Hotel Industry Performances - November 2014

In Extenso Avocats, a subsidiary of the DELOITTE Group ·27 January 2015
The combined drop in occupancy and average rates meant that trading fell significantly in November - in all segments and in nearly all destinations. Within this difficult climate, the Luxury segment was the worst affected, hit by a challenging international environment.

Deloitte - French Hotel Industry Performances - October 2014

In Extenso Avocats, a subsidiary of the DELOITTE Group · 9 December 2014
October's hotel industry performances confirmed September's observations: the results were encouraging for hotels in Ile-de-France, yet the picture was much more varied (and at times discouraging) throughout regional France. October did, however, bring a pleasant surprise for coastal hotels, where the good weather boosted trading.

Deloitte - French Hotel Industry Performances - September 2014

In Extenso Avocats, a subsidiary of the DELOITTE Group · 5 November 2014
Always eagerly awaited, the month of September was rather underwhelming. French hotel industry performances were generally better in September. However, this was mainly down to the weight of the Parisian market, as elsewhere, results remained somewhat disappointing. Although more encouraging performances were registered here and there, generally-speaking the economic context continued to drag down the sector.

Deloitte - French Hotel Industry Performances - August 2014

In Extenso Avocats, a subsidiary of the DELOITTE Group · 3 October 2014
Occupancy and RevPAR growth - let's not deny ourselves some pleasure: August finished on an encouraging note that helped boost morale further to month after month of stagnation or decline.RevPAR grew in August - a trend observed throughout all categories. Growth was modest for Super-budget and Budget hotels, but was more evident higher up the scale. Consequently, RevPAR for Super-Budget hotels grew by just over 1%, compared to 4% for Midscale hotels and 10% or more for Upscale and Luxury hotels. This growth was essentially driven by higher occupancy, since average rates remained under pressure.These good results are even more appreciated since - as emphasised by Olivier Petit, Associate, In Extenso THR - the pattern is repeated pretty much throughout France. However, this does not mean everywhere, since a number of specific features and exceptions can be noted.Luxury hotels in Paris and on the Cote d'Azur recorded a contrasting evolution in occupancy, but benefited from significant increases in average rates. A minority in France - in terms of the volume of rooms - these properties benefitted from the arrival of guests from the Middle East, who preferred to visit France in August, rather than July, due to Ramadan. In terms of keys, a higher proportion of suites were sold , resulting in higher average rates.Another exception was the coastal sector. In contrast to commonly-held preconceptions, the regional hotel industry is not actually driven by seaside hotels. These properties mainly recorded a drop in trading, largely due to the bad weather during August. The only exception to this was the Normandy coastal market that benefitted from the World Equestrian Games that took place there this year. Held every four years, the Games are one of the most important equestrian events on the planet, attracting participants and tourists from all over the world.Last but not least, even though the situation differed from one destination to the next, August's results were generally positive for the urban hotel market. Occupancy grew, even if it was often to the detriment of average rates. Hotels in a number of large cities experienced increases in RevPAR - given the bad weather, tourists tended to favour city breaks. This factor helped certain cities such as Lille, Marseille or Nantes, to avoid posting sharp declines further to excellent 2013 results.

Deloitte - French Hotel Industry Performances - June 2014

In Extenso Avocats, a subsidiary of the DELOITTE Group · 4 August 2014
June finished on a negative note, with the French hotel industry posting a decline in RevPAR. The reason? The seemingly never-ending difficult economic situation that is impacting the hotel industry, coupled with an even-numbered year with fewer MICE(*) activities: the latter illustrates how a destination's events calendar has become highly strategic for many tourism actors.

French Hotel Industry Performances - May 2014

In Extenso Avocats, a subsidiary of the DELOITTE Group · 8 July 2014
After a slight upturn in April (leading to great hopes for a recovery), May finished on a negative note, with most destinations recording a drop in performance. Trading was affected by an unfavourable agenda for business tourism. The numerous bank holidays reduced business demand, and the leisure segment - still cautious given the economic climate - remained insufficient to offset this decline.

French Hotel Industry Performances - April 2014

In Extenso Avocats, a subsidiary of the DELOITTE Group · 5 June 2014
April saw welcome growth in hotel demand indicators: nothing exceptional, but a slight improvement felt by almost all categories. The situation is all the more heartening since occupancy growth is not the result of school holidays or bank holidays falling favourably. Instead, April's growth can be essentially explained by an improvement in the economy and the resulting "catch-up effects". Further to several years of recession, the European economy is starting to recover, as are hotel overnights.This improvement in hotel demand was felt throughout most of the market. Paris, the Cote d'Azur, Regional France and large cities thus posted occupancy increases. Admittedly, some hotel categories in certain towns recorded drops in performance, but the general trend was higher occupancy.Unfortunately, average rates are not following the same pattern - stagnating in April or even falling in a number of categories and destinations. Although regrettable, this is far from catastrophic. First, declines remain modest, and secondly, it is hardly surprising that hoteliers are maintaining prudent pricing strategies, given the results of the first trimester. Average rates are only likely to grow once recovery has had time to properly take effect.The only exception during this rather encouraging month was the Super-budget sector that continued to post declining occupancy and RevPAR. Competition from alternative products and increased demand from budget guests for higher-positioned hotels left the Super-budget sector by the wayside.Ultimately, April was favourable for the French hotel sector - not exceptional, but for the first time in several months, occupancy grew. Moreover, growth was observed throughout France, rather than being just a one-off event. For all that, progressions were modest and the economic context remains difficult, particularly in France. May - with its bank holiday weekends- will be the acid test to see whether or not the industry is really out of the woods, as is hoped by so many.

French Hotel Industry Performances - March 2014

In Extenso Avocats, a subsidiary of the DELOITTE Group · 5 May 2014
After an uncertain beginning to the year, March amplified the drop in French hotel industry activity. The first trimester 2014 thus finished on a worrying note: rooms revenue in general dropped by 1% to 5% depending on the category. Occupancy continued to drop, while the 3 point rise in VAT could not be passed on to professionals.

French Hotel Industry Performances - February 2014

In Extenso Avocats, a subsidiary of the DELOITTE Group · 3 April 2014
The month of February saw mixed results. At the national level, occupancy and average rates dropped slightly, without, however, entirely collapsing. The Luxury segment was the only one to stay on course, posting positive results. Paris - usually spared from downturns - did not manage to escape during February. Conversely, other destinations benefited from bright spells, giving rise to contrasted results.

French Hotel Industry Performances - January 2014

In Extenso Avocats, a subsidiary of the DELOITTE Group · 5 March 2014
January was not a good month for the French hotel industry, as RevPAR declined. Although business did not fall dramatically, RevPAR stagnated at best, and dropped by almost 5% at worst. Never a good month for French hotels, occupancy and average rates are often low in January - a situation not helped by the current economic climate. All the same, this is the third year in a row that January's performances have dropped in comparison to the previous year (1). In short, the decline in January 2014 - although moderate - only serves to prolong a difficult situation. Rather worryingly, Parisian hotels also posted a drop in RevPAR. Although the Luxury segment managed to increase rooms revenue by +2.7%, this remained an exception.

French Hotel Industry Performances - December 2013

In Extenso Avocats, a subsidiary of the DELOITTE Group · 7 February 2014
Was 2013 all for nothing? Looking at cumulated year-end performances in December, it appears so. The variation in rooms revenue between 2012 and 2013 is desperately close to zero. From Super-budget hotels to Upscale hotels, rooms revenue stagnated, with evolutions of just -0.6% to +0.6%. The only exception to this was the Luxury segment, whose RevPAR grew by a little over 5%.Paris did, however, post some growth, although to a lesser extent than in previous years. Rooms revenue generally increased by less than 2%. Here again, the Luxury segment stood out, benefiting from the economic growth recorded in several of the world"s countries, as well as the "must-see" status of Paris.2013 was neither particularly good nor bad for the Cote d"Azur. In general, RevPAR progressed, but occupancy fell. Once again, the driver was higher room rates. To sum up, the year was fairly difficult on the Cote d"Azur, particularly for Upscale hotels.In regional France, the status quo was maintained. Rooms revenue hardly evolved and when it did, any changes were marginal. Regional hotels remain penalised by an anxiety-inducing economic context, as businesses - like individual travellers - paid attention to their budgets, limiting hotel stays. However, an interesting evolution was the slight progression in RevPAR in the Luxury segment. Although modest and driven by increasing average rates, are hoteliers beginning to anticipate a slight recovery?

French Hotel Industry Performances - November 2013

In Extenso Avocats, a subsidiary of the DELOITTE Group ·10 January 2014
November, Paris pulls up the marketNovember was a difficult month for the French hotel industry, as performances generally stagnated. Indeed, without the presence of Paris and a number of dynamic destinations, the month's results would have been even more disheartening: hotel performance in regional France, the Cote d'Azur and most large cities was down on last year. Traditionally, November is a quiet month for the hotel industry, and the morose economic situation didn't help.The timing of the school holidays (All Saints) had to some extent penalised hotel activity in October, and it wouldn"t have been unreasonable to expect a better month for hoteliers in November. However, as so often the case in 2013, hopes were dashed, as clients did not, in fact, put off their trips until November.Compared to 2012, French hotel industry performances generally stagnated in November, although there were a couple of exceptions : the Luxury segment, where rooms revenue grew, and the Super-budget segment, whose RevPAR declined by over 3%. Rooms revenue in other segments evolved between -0.5% and +1%.Traditionally calm, November was even quieter this year. Without the Parisian market and several leading destinations to pull the market up, the sector would have been in an even greater deficit. Indeed, the regions, the Cote d"Azur and most large cities posted results largely down on 2012. Trading was damaged by the ongoing morose economy, exacerbated by the fact that the end of the year is generally a quiet time for most French destinations.Paris and a number of other destinations were the exception to this rather somber picture. The Capital recorded higher rooms revenue in almost all segments. The Luxury segment saw a rise in occupancy, with average room rates being the driver in other categories. Marseille, Le Havre and Montpellier all benefited from a dynamic market, relying on a busy cultural, sporting or business calendar.2013 isn"t over yet, but we aren"t likely to see much of a change in December. At the time of writing, our forecasts presented at the beginning of the year have unfortunately come to pass: 2013 will go down as a "year of stagnation", where only the Luxury segment came out unscathed.

French Hotel Industry Performances (October 2013) - Deloitte

In Extenso Avocats, a subsidiary of the DELOITTE Group · 3 December 2013
The French hotel industry experienced a difficult month in October, with rooms revenue generally down. While certain destinations managed to resist (regional hotel activity remained mostly stable, for instance), many cities saw a drop in trading. These included Paris, where hotel occupancy has been crumbling over the past few months. The capital's hotels are thus faced with an additional pressure. However, the high levels of occupancy in Paris do give the city's hoteliers the means to maintain ambitious pricing policies.

French Hotel Industry Performances - September 2013

In Extenso Avocats, a subsidiary of the DELOITTE Group ·12 November 2013
The majority of industry observers were hoping for a good September. Should recovery be on its way, the first signs would be apparent in September, traditionally recognised for its strong business activity... Clearly, the wait isn"t over yet, much to the chagrin of hoteliers throughout France.Yet, September was far from catastrophic. Olivier Petit - Associate, In Extenso Tourism, Hotels and Restaurants - specified that overall occupancy is not declining, even if on a local level certain destinations experienced a tougher month than others. However, occupancy rate growth is rare and remains relatively limited.In Paris, Upscale and Luxury rooms revenue dropped compared to 2012. Demand remained fairly strong, with occupancy rates of 80% or even 85%, although these levels remained somewhat lower than last year. Similarly, average rates stagnated. Midscale hotels did slightly better, helped by stable occupancy (also very high) and higher average rates. Philippe Gauguier - Associate, In Extenso Tourism, Hotels and Restaurants - emphasises the extent to which Midscale hotels benefitted from a positioning enabling them to capture price-sensitive leisure and business guests.The pattern was similar throughout regional France and on the Cote d"Azur. Occupancy tended to drop, while average rates stagnated or rose slightly - a trend in line with Paris, although with one major difference: the level of occupancy. Parisian hotels are experiencing extremely high occupancy levels, difficult to exceed, which is not the case for hotels throughout regional France and on the Cote d"Azur. Occupancy is approaching 70% in the regions and 75% on the Riviera. Suffice to say here that there is still room for growth in terms of occupancy, although less so for average rates.Last but not least, our new coastal hotel benchmark: occupancy was down on last year, and with a few exceptions, average rates tended to drop quickly. Although autumn was mild, the good weather did not lead to a real extension of the summer season.

The French Hotel Industry Plays The Game Well

In Extenso Avocats, a subsidiary of the DELOITTE Group ·12 August 2013
The end of the first semester 2013 smiled on the Parisian hotel industry, as all categories saw rooms revenue progress. Thanks to higher average rates than last year, RevPAR grew by +7% to +22%. More specifically, the Upscale and Luxury segments experienced particularly significant increases, as a result of the stronger efforts of new properties in this segment this year. Given the improvement in performances since the beginning of the year, cumulated results are much better than last year, driven by higher average rates.Ile-de-France also fell in with this trend, posting healthier RevPAR (+7% to +11%), given improved average rates. Budget hotels recorded even stronger progressions thanks to a rise in occupancy. Not surprisingly, hotels located in departments adjacent to Paris achieved better trading performances than those located elsewhere in the region, and more significant increases, too.Regional hotels followed the same pattern, with improved RevPAR driven by higher average rates. The Super-budget category was the only one to remain stable. However, occupancy in regional hotels was significantly lower than last year, falling between -0.1% to -6.3%. Luxury and Super-budget hotels suffered the most, recording drops in occupancy of -6.3% and -2.5%, respectively. This fall in demand has generally led to lower cumulated RevPAR than that recorded in 2012.Upscale hotels on the Cote d"Azur were the only ones to experience a fall in RevPAR, further to a significant drop in occupancy. This trend has generally been observed over the first semester 2013. Conversely, Midscale hotels have continually posted the highest increase in RevPAR compared to other categories, again thanks to higher average rates.

Deloitte - French Hotel Industry Performances (April 2013) - Sluggish performance of the French hotel industry

In Extenso Avocats, a subsidiary of the DELOITTE Group · 3 June 2013
Directly dependent on the economic context, the hotel industry saw a further drop in rooms revenue in April. Even Paris and the Cote d'Azur - who have up till now managed to resist - experienced a decline in revenues. Occupancy continues to suffer as a result of the gloomy economic environment, but more worryingly, average rates are now starting to fall, which does not herald good news for the industry.

Deloitte - French Hotel Industry Performances (March 2013) | The red light is back on...

In Extenso Avocats, a subsidiary of the DELOITTE Group · 3 May 2013
February's timid upswing was short lived, as rooms revenue fell in March both in Paris and throughout France. The shift in the school holiday period had inflated performances in business destinations in February, temporarily erasing the difficult economic context. In March, the decline was even steeper, with regional France in particular feeling the pinch. The Luxury segment - less dependent on the national market - was the only category to extricate itself.

French Hotel Industry Performances - February 2013

In Extenso Avocats, a subsidiary of the DELOITTE Group · 5 April 2013
Overall, French hotels recorded a slight increase in occupancy in February, although falling average rates eroded any progressions. On a local scale, contrasts could be observed, with certain towns showing improvement and others experiencing a drop in demand. Differences in the timing of school holidays explain this phenomenon, with certain towns benefiting from an increase in corporate demand, and others suffering a decline.2French Hotel Industry Performances - February 2013DefinitionsOR = Occupancy RateADR = Average Daily RateRevPAR = Revenue per available roomIn general, the French hotel industry performed better in February than in January, as occupancy rose in almost all categories except for Super-budget hotels (a decline of almost -1%). The outlook thus looks slightly brighter for the French hotel industry, although we should be wary of being too optimistic: average rates dropped almost everywhere in France compared with February 2012. Although the decline remains minimal (less than 2% for all categories), the trend is slightly worrying. Hopefully, it won"t last long.Although increasing occupancy did tend to ultimately compensate for the drop in average rates, there were two exceptions: the Luxury segment, whose RevPAR rose by +2.3% and Super-budget hotels whose RevPAR dropped by -1.8%. However, a deeper analysis of the various hotel markets illustrates that geographical differences exist. While the rising occupancy trend was indeed perceptible in Paris and on the Cote d"Azur, gaps between towns were particularly wide, especially in terms of occupancy rates. For instance, in the Midscale segment, occupancy performances ranged from -22% for Cannes to +14% for Nancy, a phenomenon experienced by all categories. Does this mean that part of the market has started to recover, with the remainder still deep in recession?In fact, performance disparities can partly be explained by the different timing of school holidays. Last year, for instance, schools belonging to the regional education authorities "A" (Caen, Grenoble, etc.) and "C" (Bordeaux, Paris, etc.) were mainly on holiday in February, and those belonging to the authority "B" (Aix-Marseille, Amiens, etc.) in March. This year, the opposite is true, with certain markets benefitting from greater corporate demand. Although this is evidently not the only element to affect the hotel market, it does appear to be a deciding factor.

Deloitte - French Hotel Industry Performances (January 2013)

In Extenso Avocats, a subsidiary of the DELOITTE Group ·13 March 2013
The year 2013 started badly for the French hotel industry. With the exception of a few destinations currently benefitting from locally-held events, the majority of French cities recorded results inferior to last year's. Declining occupancy had a harmful effect on rooms revenue in Paris and on the Cote d'Azur, too. 2013 got off to a bad start, with January's performances down on last year's. Rooms revenue declined by 2% to 3% compared to 2012; a phenomenon affecting most destinations in France. Paris and the Cote d'Azur proved no exception, recording lower RevPAR performances than last year. Regional France was hit especially hard, with hotels posting 2% to 12% drops in rooms revenue.

French Hotel Industry Performances December 2012 | 2012: A mixed bag

In Extenso Avocats, a subsidiary of the DELOITTE Group · 6 February 2013
Paris and the Cote d'Azur managed to perform surprisingly well during what was a difficult year. The diverse guest mix and international orientation of hotels in these destinations enabled them to resist the market downturn and end the year 2012 on a relatively high note. Conversely, regional hotels - more oriented towards the domestic market - were hit with the full force of France's stagnating economy. Performances were poor and the situation could be even more critical, once commissions to intermediaries are deducted.

French Hotel Industry Performances November 2012 - will the recession ever end?

In Extenso Avocats, a subsidiary of the DELOITTE Group · 8 January 2013
A traditionally calm month, anyway, November merely confirmed the tense situation in which the French hotel industry finds itself. Even destinations that have so far managed to resist - such as Paris and the Cote d'Azur - saw hotel activity drop in November. The French hotel industry remains weakened by the economic context and circumstances could become even more difficult with a less busy events calendar or the occurrence of isolated incidents.

French Hotel Industry Performances October 2012 | France, a two-speed market

In Extenso Avocats, a subsidiary of the DELOITTE Group · 6 December 2012
The French hotel market is increasingly looking like a two-speed market, comprising destinations able to attract corporate and leisure, national and international, individual and group demand on the one hand, and destinations where one segment dominates on the other. Topping the table amongst the first category lie Paris and the Cote d'Azur - although challenging, market difficulties remain limited. However, the majority of regional France falls into the second category - recession remains at the forefront and market difficulties are omnipresent.

French Hotel Industry Performances September 2012 | Autumn sends a chill across the French hotel industry

In Extenso Avocats, a subsidiary of the DELOITTE Group · 8 November 2012
September proved disappointing for hotel professionals, with performances down on last year's results. Traditionally a strategic month for the hotel industry, September saw occupancy in most areas and hotel categories drop. The decline was more or less flagrant, depending on the destination, and although a few exceptions were noted, the general underlying trend was present. Admittedly, average rates grew, but with the exception of Paris, increases were not sufficient to curb falling rooms revenue.


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