With some 600,000 apartments worldwide in 2011, the tourism residence market covers close to 8,630 destinations. In France, they attract some 15 million customers each year who are mostly leisure travelers. But the market keeps pace with changing lifestyles and thus demand, and so increaslingly looks toward business tourism. By turning towards cities, France’s supply increasingly resembles the American extended stay model while the latter is currently entering a transatlantic race to take its first steps in Europe and move away from a very saturated market. All these factors contribute to the increasing competition paced by European hoteliers.
The concept of tourism residences appeared in France in the 70s with the advent of integrated winter sports resorts. At a time when developer were looking for ways to turn investments into profit – notably with ski lifts– French tourists, particularly families, were looking for a “home” in their vacation destinations. This new consumer trend could have benefited the secondary residence market, but this was considered too costly, both in terms of investment and maintenance for just a few weeks of vacation a year. Families thus opted for rentals facilitating the commercialization of ski resorts and the profitability of investments, thereby giving birth to tourism residences. This new concept grew with the implementation of real estate developments to make this type of property accessible to as many people as possible. So the top tourism residence clients –skiers– were quickly followed by bathers as the model developed along France’s shoreline. French enthusiasm for the formula that led to the creation of the classification “Tourism residence” in 1983 encouraged the appearance of dedicated brands such as Pierre&Vacances, Odalys and Lagrange. Driven by strong demand, the sector developed rapidly from 60,000 beds in 1979 to 240,000 in 1990. This momentum was sharply stalled by the real estate crisis in 1996 that forced the government to react by implementing the “loi Périssol”, granting tax advantages to owners. Construction thus took off at a rate of 20,000 beds per year, then 30,000, to reach 47,000 in 2007. While growth was fast, it was also uncontrolled, especially after the implementation of the Besson-Demessine tax arrangement. Implantations of residences which are encouraged in ZRR (rural development zones) were most often done despite the low commercial viability of projects sold to investors. Some operators thus found themselves unable to pay the rents to owners and a wave of...
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