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February 2019: French hotel industry performances driven by the Paris region

Like the trends observed in other European countries, in February 2019, average daily rates are what drove the RevPAR up. Growth in the RevPAR by 2.6 % is not spectacular, but the month of February 2018 already reached an exceptional high. In France the trends reversed themselves with respect to the previous month: the Paris region progressed, while the provinces stagnated and most of the regional capitals lost ground.

Also read: February 2019, results settle for European hoteliers

A RevPAR up thanks to an increase in average daily rates

National averages across all segments returned to their 2018 levels this February 2019. While the occupancy rate remained stable, average daily rates increased 2.7% and drove the RevPAR up (+2.6%).

The budget segment enjoyed a favorable context: occupancy rate and average daily rates increased by 1 point and 3.4% respectively compared to the same period last year. Because of this, the occupancy rate tends to regain a level comparable to those of the other segments contrary to previous months when this segment was 2 to 3 points points below average.

At the other end of the spectrum, the upscale segments also improved with an occupancy rate that is down slightly (-0.6 point) alongside an average daily rate that is up significantly (+3.6%). These results should be put into perspective with respect to performances December and January: the occupancy rate was decidedly weaker than the previous months (-1.3 point) and the increase in ADR was thus hindered (+0.8% and +1.5% which is much lower than that of other sectors).

Also read: Janvier 2019 : l'hôtellerie française fait grise mine

The Paris region drives the national average

Growth is especially exceptional on the periphery. Compared to a  a good February 2018, occupancy rate nonetheless gains 0.4 points and average daily rates are up 6.8% bringing the RevPAR to 7.5%. Occupancy rate in Paris intramuros also rose 0.2 point while average daily rates increased 1.7% for a RevPAR up 1.9%. 

Paris intramuros's upscale segment appears to have finally absorbed the drop in activity of the previous 2 months. The occupancy rate had, in fact dropped (-6.6 points in December and -4.5 points in January with respect to figures the previous year). Results are comparable to February 2018 although slightly inferior (-0.5 point for the occupancy rate and -0.4% for the RevPAR). A close look at the daily figures of Paris's hotel industry suggests that there was a fairly significant recovery mid-February. Now we must wait for March's figures to confirm this recovery and verify that this trend didn't bend again to the will of Yellow Vests Act XVIII.  

Also read: "The Yellow Vests, Act XVIII": hoteliers are suffering

Poor performances for regional capitals  

The RevPAR at eight of the ten largest agglomerations outside Paris is down  with respect to February 2018 and only  Lyon and Grenoble continue to grow.

In Marseille, the drop in the RevPAR by -5.6 % is above all related to the average daily rate (-3.5 %). The exhibition Energy for Smart Mobility which was held in February last year but will take place in March the yearly have limited the increase in prices.

In Bordeaux, the drop in the RevPAR by -3.5% appears to be more structural. For several months now the occupancy rate has been shrinking despite adjustments to prices that have also been decreased. After reaching highs in occupancy rates in 2018, it is possible that the "sleeping beauty" is slowing down and reaching a new balance that is just below the record highs of last year. Growth in the supply could also explain this drop.

Also read: Bordeaux, la destination à la loupe (in French)

Evolution des performances hôtelières à Bordeaux depuis 10 ans
Source : observatoire MKG Consulting / OK_destination

Even more surprising is the drop in RevPAR in Rennes (-4.7%). Rennes' hotel industry has enjoyed renewed dynamism  since the opening of the Paris Rennes TGV service in 2017 and is experiencing significant growth - often double-digit - for nearly a year. Only the month of March 2018 was negative (-0.7%). Last year February was particularly brilliant for hoteliers with a RevPAR up +18.2%. Has Rennes, like Bordeaux, reached a maximum? Are Rennes's hotel performances shrinking before stabilizing? It is still too early to tell. An analysis of March's results will determine whether or not the trend is real.

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