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October 2019: French performances in the red, the Province alone is maintaining itself

Figures are falling down a little bit more during the Fall break. A month in the red is emerging everywhere, with the exception of the French regions (excluding Paris Region) that are maintaining their growth trend, driven in particular by the upscale and midscale segments.

In an economic, social and political climate that is not conducive to international tourism, national hotel performance dropped into the negative zone in October 2019. The monthly occupancy rate (OR) fell by 0.5 points to 72.6%, the Average Daily Rate (ADR) fell by -3.0% to €97.00 excluding VAT, resulting in a negative change in RevPAR of -3.6% (€70.40 ex VAT).

As for occupancy, all segments were impacted by this decline; the strongest decrease came from the Economy segment which Saw its OR down -0.8 points to 72.1%, driving the overall result down. It is followed by the Budget (-0.4 pts; 69.8%), Midscale (-0.3; 73.3%) and Upscale (-0.1). The Upscale flirts with steady growth and produced the best OR of all segments (77.7%), slightly compensating for the drop in ADR (-5.1%; €202.40 ex VAT) and nevertheless leads to the lowest RevPAR (-5.2%; €157.10 ex VAT).

The evolution of the ADR reveals a very different situation. First of all, one ADR is growing: that of the Budget at +1.3%. It leads to the only positive RevPAR at +0.7% or €33.60 ex VAT per available room. The Economy slightly reduces its ADR (-0.5%), but it is mainly the Midscale (-4.2%) and the Upscale (-5.1%) that are lowering their ADR. The RevPAR was down -4.6% for the Midscale and -1.6% for the Economy.

The hotel industry In the Ile-de-France is still the main region affected by the decline in growth, as was the case this summer and at the start of the new academic year. Across the Île-de-France region, occupancy is down -2.6 pts,  -1.1 pts for Paris and -3.7 pts for the IDF excluding Paris). In the capital, it is the Economy that loses the most market share (-3.3 pts) while in the rest of the Île-de-France region, it is the Midscale that weakens (-5.1 pts), although the same trend is followed by the Economy (-4.3 pts) and the Budget (-2.6 pts). The Upscale is slightly spared, with a smaller decline in occupancy (-1.9 pts).

On the contrary, the overall ADR for all segments combined beat the record with a decrease of -8.2% in IDF excluding Paris and -8.0% in Paris. As for the RevPAR, it ranges from -9% to -11%, with an average of -9.7% for the entire IDF region (including Paris), a maximum decrease of -14.5% for the Midscale in IDF (excluding Paris) and a minimum of -3.4% for the Budget over the entire Ile-de-France region (including Paris).

In the rest of France, the horizon is clearer. Occupancy is not down, but records stagnant growth at +0.6 pts, for an average OR of 67.6%; the ADR increases by +2.3% (€79.20 ex VAT) and the RevPAR by +3.2% (€53.60 ex VAT). The growth in occupancy of the regional supply is mainly driven by the Midscale (+1.3 pt; 67.7%) and the Upscale (+1.0 pt; 70.1% - best OR of all the French Regions, excluding Paris Region); rates are particularly driven upwards by the Budget (+2.6%; €45.00 ex VAT) and the Economy (+3.9%; €68.60 ex VAT), the latter achieving the best RevPAR growth (+4.5%; €46.60 ex VAT). The other RevPARs are equally positive: +3.0% for the Middle (€64.10 ex VAT) and +2.7% for the Bottom (€29.80 ex VAT) and the Top of the Basket (€122.20 ex VAT).

As a result, occupancy rates in most major cities in France are progressing, with the exception of Paris, Lille (-1.0 pt), Toulouse (-2.0 pts) and Rouen (-7.1 pts) - whose Lubrizol plant incident on September 26 was felt throughout the whole October period. In contrast, the metropolitan areas of Nice (OR +4.7 pts, RevPAR +10.7%) and Grenoble (+4.6 pts; +9.6%) outperformed other metropolitan markets remarkably well, particularly during the All Saints' Day holidays. In the other cities, occupancy results ranged from +0.4 in Bordeaux to +2.1 pt in Lyon, reflecting rather stagnant performance overall, in line with the results for the entire province.

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