Canada -  Quebec City

Overview:

The Quebec City lodging market is driven largely by provincial government demand. In 2015, according to RBC, the province realized GDP growth of 1.1%, RBC while according to the Conference Board of Canada, Quebec City sustained slightly stronger GDP growth of 1.4%. A stronger performance in manufacturing and the service sector contributed to this growth. The low Canadian dollar was largely responsible for fostering increases in manufacturing and tourism activities within the province.

The Quebec City lodging market achieved a RevPAR of $104.01 in 2015, up 4.3% from the 2014 level, driven mainly by ADR growth. A 0.8% increase in the room supply and softer convention activity were responsible for the decrease in the market-wide occupancy. In the 2015 HVI report, the per-room value of the Quebec City lodging market was projected to increase by 5.0%; however, the year-end performance was slightly weaker than had been anticipated, and the per-room value actually increased at a slightly more moderate rate of 4.5% to $96,184.

The market is expected to see stronger economic growth in 2016. RBC projects the provincial real GDP to grow 1.3% in 2016 and a further 1.6% in 2017. In 2016, the room supply is projected to increase 0.7% as a result of the newly opened 160-room Courtyard Quebec City. Given the favourable economic conditions, the market is expected to achieve a RevPAR of $111.71 in 2016, up 7.4% over the previous year, supported by increases in both occupancy and ADR.

Over the next four years, the market-wide room supply is expected to see only limited growth. The 100-room Hampton Inn & Suites Quebec City Saint-Romuald is projected to open in 2017, but no other new supply is on the horizon. With the supportive operating conditions, the per-room hotel value for the market is projected to reach $108,595 in 2016, similar to the previous peak of $110,304 achieved in 2008 when the 400th anniversary of the city was celebrated. The per-room hotel value of the Quebec City lodging market is projected to reach $121,283 in 2019, putting the market into fifteenth place among the major lodging markets in Canada, up two positions from 2015.

Valuation Trends and Predictions:

Quebec City Canada
Previous Year +13% (10 of 19) +9% (12 of 19)
Growth in 2017 +6% (11 of 19) +5% (12 of 19)
Growth in next 3 years +12% (10 of 19) +8% (15 of 19)

Change In Value For Market:

Quebec City RevPar % Change

For more information, please contact:

Monique Rosszell, AACI, MRICS, ISHC
mrosszell@hvs.com
  • +1 416 686-2260 (w)