AccorHotels announced that it was in talks in to acquire a stake in Groupe Noctis, the luxury Paris-based events and hospitality company.
The transaction would increase AccorHotels’ stake in a city which, under new president Emmanuel Macron, is selling itself globally as revitalized and dynamic as it looks to the parliamentary elections and bids to host the Olympics in 2024.
“We have seen a lot of countries affected by politics, but the Macron effect has had a positive impact,” Carine Bonnejean, head of consultancy - hotels, Christie & Co., said. “There has been a renaissance of interest in France, I hope that it will be similar to what we have seen in Canada with the Trudeau effect.
“It is good to have an English speaker, he is a breath of fresh air. He turned up with a backpack for his first meeting. He is bringing a lot of young blood and hopefully he will bring Paris into the next generation.”
Sébastien Bazin, chairman & CEO, AccorHotels, said that Groupe Noctis was “more than an enviable address book: Laurent de Gourcuff [CEO & founder] and his teams have built a portfolio of distinctive venues with strong characters that are promoting Paris on the international scene.
“This alliance blends naturally into our plans to transform and boost AccorHotels with a view to catering to increasingly discerning customers’ wants and needs beyond the travel universe. Its expertise and ours complement each other, and pooling our assets will put us in a position to tap into growth opportunities and synergies in France and beyond.”
City of Lights, Energized
AccorHotels has something of a reputation these days for buying into companies outside of the traditional hotel business. Around this time last year, the company acquired home rental startup Onefinestay, and earlier this year announced plans to buy luxury rental broker Travel Keys. While this newest deal allows AccorHotels to branch out further into the events and restaurant scene throughout France, the deal will help Groupe Noctis expand its portfolio of venues, which include Monsieur Bleu, Loulou and Pavillons des Etangs. It signed agreements to open about 10 new venues, including the rooftop restaurant at 52 Champs-Elysées.
AccorHotels is not the only company to embrace the City of Lights, with developers ADIM Ile de France and Sogeprom signing on to develop a new tower project in La Defense, Paris. The hotel-led scheme will include 730 rooms to be branded under one or more InterContinental Hotels flags, including Holiday Inn, Staybridge Suites and Crowne Plaza.
Paris had already started to bounce back from weak performance marred by security concerns in the country. STR reported that Paris City Centre saw revenue per available room growth of 29.7 percent in January, with STR analysts commenting that the country's hotel performance should grow more stable as it becomes further removed from the terrorist attacks of the last several years.
“For the first time since Napoleon we have a leader younger than 40,” said Florence Mebrouk, managing director - France, Christie & Co. “The way that he wants to do politics is quite different to how they have done it in the past and people are hopeful - even people who voted for him just to keep Le Pen out are happy. We are all looking for the next step and whether he gets the majority in parliament or not.
“The Right has tried to put pressure on him and the Left is sending a similar message, although they are likely to cooperate more. The main concerns now are around possible changes to tax, but I am not sure that he is in the mood to challenge corporate tax,” Mebrouk said.
On the topic of investors, Bonnejean said Paris has room to grow. “We’ve seen a growing market, because before the election people were on the fence,” she said. “The election of Macron has encouraged confidence and there is a feeling that now is a good time to get into the country.”
The leisure market in particular suffered in the wake of a series of terrorist attacks in France and there are hopes that Macron will lift the current state of emergency, which has deterred some travel insurers. Mebrouk’s view of visitors pouring into a Parisian department store suggested that hope sprang eternal.
Katherine Doggrell is an editor at Hotel Analyst, the U.K.-based news analysis service for hotel investors.