1,700 sites for sale; revenue will help trim nation’s huge debt

PARIS: Fancy setting up house in a French government ministry? Or retiring to a royal hunting lodge?

France is selling off 1,700 government-owned properties, including a magnificent chateau with its own private dock on the shores of Lake Geneva and a 1920 luxury Paris villa not far from the Eiffel Tower.

The real purpose of the super-sized sale is to dispose of dilapidated, expensive-to-maintain buildings, while also chipping away at the country’s record-high debt.

The French budget ministry said on Wednesday that its latest sale, part of a programme that began in 2005, will see mostly office buildings, housing blocks and military barracks up for grabs.

Among the properties are chateaux, such as one in Thonon-les-Bains built in 1800 and perched on the shore of Lake Geneva at the foot of the Alps. Another is a royal hunting lodge and guest house built the century before in the Saint-Germain-en-Laye forest west of Paris.

‘Buildings unoccupied for many years. Needs restoration,’ reads the government’s listing for that property.

A huge parking garage located in south-east Paris will be shut down and sold off next year after the state decided to outsource maintenance work on the government’s fleet of cars.

Full details of the assets will be released on a website for potential buyers to browse.

Foreigners are welcome to join the bidding, said Budget Minister Francois Baroin – but their cash must be clean.

Any buyer, whether a movie star, foreign government or ordinary taxpayer, will undergo thorough background checks.

This is a sensitive issue at the moment in France, where Panama’s former dictator Manuel Noriega is going on trial this month on charges that he laundered cocaine trafficking proceeds via French banks and three Paris apartments bought by his wife in the 1980s.

Most of the buildings and land are located in the French provinces, with some even in overseas territories, part of a massive property portfolio that the state could barely keep track of.

‘The state now has a clear picture of what it owns,’ Mr Baroin said.

Since 2005, sales of state property have generated more than €3 billion (S$5.1 billion).

Most of the buyers have been local governments, which get priority, and real estate investors.

However, the French government’s property sell-off has raised hackles, following reports that some buyers were picking up buildings for a song and reselling them for a hefty price.

The Cour des Comptes, France’s quasi-judicial public institution audit office, noted last year that 10 transactions between 2005 and 2007, worth €84.2 million, were later sold by their new owners at a €42 million profit.

The state property managers have since introduced a clause in sale contracts specifying that the government will get part of the profit if the building is sold within two years.

Part of the revenues from property sales is used to fund new construction projects or major restoration work, but about 15 per cent goes to reducing the government’s debt.

Mr Baroin said he hoped that this percentage will increase in the coming years.

AGENCE FRANCE-PRESSE, ASSOCIATED PRESS

Source: Straits Times, 11 Jun 2010

The new upgraded rating criteria will apply to 18,000 hotels across France

France, the world’s top tourism destination, is polishing up its hotel star ratings and introducing a new luxury five-star category to help travellers know what to expect.

The new rating criteria will apply to 18,000 hotels across France, many of which are showing off stars awarded under the previous ranking system that dates back to 1986.

The upgraded star system went into force at the weekend when details were published in the government gazette.

The most spectacular change is the new five-star category – already claimed by some 60 hotels such as the world-class Paris Ritz or the Hotel Negresco in Nice.

Industry leaders say the five-star category will help France face tough global competition at a time when the hotel business is struggling to recover from the global downturn.

‘The terms of reference were out of date,’ said Christine Pujol, president of the hotel owners’ main trade group Umih.

‘Customers did not know what to expect any more from a two-star hotel,’ added Genevieve Balher, president of the Synhorcat group representing the hospitality business.

A hotel ranked in 1986 may well have kept its stars without undergoing any renovation and there is no control over the ranking, she said.

Under the new criteria, stars will be attributed for a period of five years by accredited auditors instead of a government agency.

The prefect or state official for a department will however have the final word on granting stars.

The zero-star hotel is consigned to history under the new regulations, meaning that the lowest possible standard of comfort is now the one-star hotel.

A one-star room should be no smaller than nine square metres and have a shared bathroom with guests from no more than seven other rooms.

More stars means a bigger room and Internet access, for instance, is now a criteria for a three-star hotel.

‘Guests will know that the star ranking is a guarantee of cleanliness and furnishings that are in good condition,’ said Michele Le Poutre, who helped elaborate the new criteria.

But Mark Watkins, president of a committee pushing for more modern French hotels, said the new rating system was already out of sync with that of other international destinations.

‘En suite bathrooms are only compulsory for three-star hotels and you will have to go to a four-star to get international channels on television,’ he complained.

Mr Watkins said the new rating system would benefit mostly hotel chains and that independent owners will have a tougher time satisfying the criteria.

Industry officials estimate that up to 10 billion euros (S$20 billion) will be spent by hotel owners in the coming years for renovation work that will allow them to keep their stars.

France draws tens of millions of visitors each year to its tourist attractions, cultural sites and world-class restaurants, but the global downturn has hit the hotel sector hard.

Major chains like Accor, Europe’s biggest hotel group, have reported a plunge in sales as bookings slowed dramatically over the summer months with the loss of British and American tourists.

Under the new regulations, any hotel can choose to apply for the star rating, but there is a fee.

Source: Business Times, 29 Dec 2009