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March 2022: towards a rebound in the French hotel industry?

The month of March 2022 lets us think that the tunnel will soon be cleared after two years of health crisis: at this time last year, the country was still under heavy health measures, but this year the trends are finally approaching those of 2019. Two years later, is it finally time for the French hotel industry to recover from the health crisis?

On a national scale, the French hotel industry, with only -4.9% below its 2019 level, the RevPAR  is on the way to reach its pre-crisis level. All ranges are concerned, although the super-economy range is in the best position with only a -1.7% gap. However, it is in the top of the range segment that the catching up process is most significant in March with a return to only -6.2% of its pre-crisis levels.  RevPAR is now €124.7, compared to €16 at the same time last year.

The return to near-normal performance levels can also be explained by a rise of prices: relative to 2019, prices are up by +4.9% at national level. The top-of-the-range hotels show a higher evolution with an increase of 13.1% of their ADR. 

At the national level, the occupancy rate is still slightly behind with a drop of -6.1 points compared to March 2019, but this has clearly improved since the beginning of the year. This delay remains a little more noticeable in top-of-the-range accommodations with a -11.6 pts gap, although this range has experienced the most promising recovery with an attendance that has increased by half relative to March 2021 due to the return of international clientele.

From a geographical point of view, the provinces have returned to their pre-CIVID level with a RevPAR equivalent to the one of 2019, whereas it was still divided by two last year at the same period. Although Paris has not yet fully recovered its pre-crisis standards (-6.7%), the capital is showing a real catch-up dynamic: the decline in February was still -27.6% relative to 2019. The explanation lies both in an upward trend of prices and also in a clear coming back of business and leisure clientele but also and especially foreign clientele. The Ile-de-France periphery is still lagging behind in this recovery, but the situation is also improving there.

The Île-de-France and PACA regions have thus seen their RevPAR increase significantly, with -10.8% for the former and +2.1% for the latter. This situation can be explained both by the end of the sanitary restrictions in France (end of the  mask and the health pass at mid-March) and by the reopening of the borders allowing the return of the luxury clientele, traditionally present in these regions. To this is added a certain return of business travels.

In this month of March 2022, leisure tourism has also reinvested some nature destinations (Charente, Ariège, Creuse, Jura, Haute-Loire...) which are reporting double digit RevPAR gains. The mountains have not been left behind: after having heavily suffered from the health restrictions and closure of the slopes in 2021, the departments of Savoie and Haute-Savoie are now performing better than before the crisis with RevPAR increases of +7.1% and +5.6% compared to 2019.

Lastly, the Atlantic coastline once again stands out, posting RevPARs that are significantly higher than before COVID, having returned to almost the 2019 level of occupancy while posting an average price that is 8.6% to 9.3% higher.

Among the major cities, Toulon, Marseille, Nantes, Rennes and Montpellier are rebounding with performance levels above those of 2019. Toulon even saw its RevPAR increase by 20.8% compared to 2019, which is also explained by the economic activity of its port. But it is in the Nice metropolitan area that the dynamic is most striking: while the agglomeration only posted a RevPAR of €8.2 last year at the same period, March 2022 recorded a RevPAR of €74 linked to the reopening of the borders and the return of foreign customers, particularly high-end ones. Prices are therefore growing exponentially (+24% compared to March 2019).

Thus, after two years of health crisis, the situation is gradually improving for the French hotel industry and all segments are gradually returning to their pre-crisis performance levels. The trend should be reinforced as the spring holidays approach and the warm weather sets in, allowing the sector's professionals to return to their hotel business !

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