Global chains find the time is ripe for Bordeaux
Global chains find the time is ripe for Bordeaux
28 AUGUST 2019 7:29 AM

Massive urban regeneration and spiraling tourism are reaping unprecedented international hotel development in France’s wine capital, Bordeaux.

BORDEAUX, France—The French wine center of Bordeaux is ripening very nicely, according to sources.

The city has long drawn travelers with its”wine and its 18th- and 19th-century architecture,” said Jean-Philippe Burgeat, owner of the 12-room Hôtel de Tourny, which occupies one of this World Heritage-listed city’s classic limestone buildings.

But Burgeat said Bordeaux is experiencing a period of dynamic growth, with an in-flow of low-cost tourists and investment from larger American groups.

International hotel chains such as Marriott International, Hilton and Radisson Hotel Group are active in development.

Burgeat, also the president of the Les Hôteliers Indépendants de Bordeaux, said big city investments modernizing infrastructure have driven the fast pace of new openings.

“Whereas once big French hotel groups dominated, there has recently been a big rise in small independent hotels that reply to a tourist demand who don’t want to go the chains, and now we see new actors come that have more than 150 rooms. … That, too, is new, and it is creating a far more diverse offering,” Burgeat said,

The Bordeaux Convention Bureau said the city is witnessing a dynamic spate of hotel openings and renovations, with a current roster of 16,600 rooms and 220 hotels and a pipeline of approximately 750 rooms.

The Radisson Blu, Bordeaux; Hilton Garden Inn Bordeaux Center; Golden Tulip Bordeaux-Euratlantique, and boutique Le Palais Gallien all opened in the second half of 2018.

German hotel group Meininger will open an asset in new business hub Euratlantique in the first quarter of 2020.

Development also has spread into other metropolitan areas, with 2019 openings including the 77 room Holiday Inn Express Bordeaux-Lormont. In 2021, in Chartrons, a district just north of the center, a Canopy by Hilton property will debut, while in the same year Marriott will open a Sheraton by the city’s airport.

Supply pressure
All this hotel development is coinciding with escalating tourist numbers, up from 2.5 million in 2010 to more than 6.1 million today.

According to data from STR, the parent company of Hotel News Now, average daily rate jumped 6.4% in year-to-date June 2019 terms to €82.67 ($91.69), and revenue per available rooms jumped 5.3% to €55.54 ($61.60).

Burgeat is worried about supply.

“Sure it’s a problem. We are not sure what the fallout will be for us, as I am not convinced the tourist population will double over the next few years, so there will probably be too much supply, though it’s still not the case,” Burgeat said.

“So we have to constantly perform better, as the cake is still the same size, but there are many more people eating it. Maybe the competition will see price hikes. What is sure is that we as independent hoteliers have the advantage of having very personalized service and being able to decide from one day to the next to invest in upgrades,” Burgeat added.

As foreign investors continue to line up for new projects, the brand reputation of existing international chains in the city is having a very positive knock-on effect, according to Vincent Digne, the former pre-opening GM of the new Hilton Garden Inn.

“This raft of openings I think comes down largely to the escalating tourist numbers and the fact that customers want hotels different to Accor (that) previously controlled at least 80% of the supply. … I think investors saw the opportunity to create new foreign brands,” Digne said.

Digne said the international brands’ strong loyalty platforms will allow their new assets to immediately get good performance.

French wobbles
Pierre-Frédéric Roulot, CEO of Louvre Hotels Group and Jin Jiang Europe, said the year in France got off to a rough start with the political protests from the Mouvement des Gilets Jaunes, or Yellow Jacket Movement, taking its toll.

“But over the summer, the figures show we are doing very well,” Roulot said, who added his hotel firm saw Bordeaux as very open and welcoming.

“(Our owner Jin Jiang is) very open to financing new projects. … We opened at the train station, in Euratlantique, which is a very good sector in full development,” Roulot said, referring to the new Golden Tulip.

“Real estate prices in Bordeaux have gone upmarket, so we brought in the product that goes with that,” Roulot said.

He noted his company is not new to the market.

“We were already present in Bordeaux with about 20 others hotels, and now we have a 4-star (asset) as economic conditions spark more demand, especially from overseas, that allowed us in turn to attract a new market,” Roulot added.

Bordeaux’s Chamber of Commerce & Industry said for the first time the U.S. represented the second biggest inbound hotel clientele (6.6%), ahead of both the United Kingdom and Spain.

Officials at Radisson Hotel Group are confident France is back and happy at the first-year performance of their new Bordeaux property, which is in the Bassins à Flot district.

Radisson Blu Hotel Bordeaux assistant manager Olivia Ponté said several more U.S. brands* likely will come to the city.

“The center of the city is a bit crowded, so hotels now tend to develop outside of that. Bassins à Flot is very up and coming with lots of renovation taking place. We are lucky enough to be among the first in this area, and there are going to be at least another couple coming online soon,” Ponté said.

Ponté also points to brand power of the new arrivals, contributing to July occupancies of 80% (STR puts average city occupancies in June for the year to date at 67%).

Ponté attributes much of the turnaround to former French Prime Minister Alain Juppé, whose second lengthy stint as Bordeaux mayor ended in March.

“He did a massive job in terms of refurbishing the whole town, improving public transport and other infrastructure. For over two years, there has been a TGV (high-speed train), and Paris is (now) only two hours away,” Ponté said.

* Correction, 3 September 2019: The story has been corrected to more accurately reflect Radisson Blu Hotel Bordeaux assistant manager Olivia Ponté's original statements. 

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