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March 2019: Hotel performances in France are in the red

The RevPAR is down despite prices that are kept up, hoteliers suffered in March 2019. Has brand image been spoiled by the yellow vest protests? Paris is down, but it is not alone in its suffering in March and all segments have been affected. March is usually a month of rebound for the french hotel industry which benefits from a busy events calendar. 2019, however, breaks with this tendency.

The Caesar ceremony in February this year is  not enough to explain the drop in hotel performance, reflected in a RevPAR of -1.2% across all categories compared to March 2018, which showed an increase of +6.8%.
French hoteliers posted a RevPAR of €59.1 ex-VAT in March 2019, with an OR down -1.8 points (67.2%) and average prices maintained at +1.6%, €91.3 ex-VAT. The entry-level and high-end segments were the most affected, with occupancy down -2.3 points and a RevPAR of -0.9%, supported by prices that were up 2.7% for the budget segment. In the high-end and luxury segment, a 2.9 point drop in OR to 67.2%, with prices maintained at +2.8% (€200 ex-VAT) for a RevPAR of -1.5% (€134.5 ex-VAT), with the sharpest decline per segment.

Year to date, the trend remains positive across the first three months of the year: + 2.4% for the RevPAR in budget, + 2.2% in economy, +0.9% midscale and +0.2% in the high-end and luxury segment for overall growth by +1.2% (53.70€ ex-VAT). The month of April might make it possible to for French hotels to revive themselves.

While the Île-de-France drove results up in February, the capital is down in March with a RevPAR down -4.9% with respect to March 2018 (81.70€ ex-VAT) influenced by an OR down -4.1 points. The capital loses -2.8 points of its OR to 78.5% and the rest of the region experienced a sharp drop in OR by -5.2 points (69.9%). The RevPAR thus fell -4.9% in the Île-de-France region (81.7€ ex-VAT).

In the provinces overall the picture is less bleak, the regions manage to keep their indicators in the green with +2.2% in RevPAR (€47.7 ex-VAT) but it is the average daily rates that allow them to remain in positive while the OR loses -0.7 point (60.4%).
While Cannes (which benefited from MIPIM), Lille, Lyon, Marseille, Rennes and Rouen are doing well with a RevPAR that increased from +15.5% for Lille to +7.1% for Rouen, others are performing poorly.

Nantes, with a 1.6% increase in RevPAR driven by an OR up +2.2 points (69.7%), and Strasbourg, with a 0.4% increase in RevPAR driven solely by the increase in ADRs, up +4.7%, while the occupancy rate is down -2.5 points, are only barely come out on top.
The picture is gloomier for Toulouse (-4.0% of RevPAR), Grenoble (-4.8%), Montpellier (-5.5%), Nice (-6.3%), and Bordeaux, which has the worst performance with a RevPAR down -8.7% to €52.4 ex-VAT and the largest drop in OR by -5.1 points. However, the supply is still growing in the capital of the Gironde, which needs to find a second wind in its arrivals.

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