Spanish tourism: a giant that wants to wear a tuxedo
After refurnishing its hotel stock, the world’s second most visited country now aims to lure quality travellers and break the seasonal and territorial boundaries that have historically tied it. The transformation of Magaluf is the best example
Imagine that you want to open a five-star hotel with 240 suites, two huge swimming pools, spa, gym and even four restaurants. Would you choose Magaluf to build it? You may not believe it, but Zafiro Hotels has done just that with its luxurious Palmanova Palace.
Asked whether the idea can sound crazy to some people, Tobias Neumann, marketing manager for Zafiro Hotels, concedes, “Of course, of course! Above all because of Magaluf’s image, but the industry is putting efforts to change that perception.”
Change. When tourism is discussed in this resort, that is the most heard word. Located at southwest Majorca, within the boundaries of the Calviá municipality, Magaluf made a name for itself as a low-cost, hedonistic tourism mecca.
In another island located some thirteen hundred kilometres north — Britain — thousands of youngsters sigh for the arrival of the long-awaited summer, at which time they will fly to a far from exotic place: pubs broadcasting the Premier League, full-English breakfasts, greasy food, newsstands offering The Sun and The Mirror, cheap cocktails, and a lot of beer. However, Magaluf combines those British joys with three specifically Southern elements: warm sea, white sand and plenty of sun.
Known in the last decade for endless parties, alcohol, drugs, prostitution and balconing (the act of jumping into a swimming pool from a balcony), Magaluf’s notoriety reached its peak in 2014, when a Northern Irish girl was recorded performing oral sex with a dozen or more men in exchange for drinks. The story was widely picked up by British and Spanish media.
At one point, locals told themselves “Enough is enough.” Tourism managers reacted to the resort’s decadency with a mandate for change. At the forefront of those efforts was Meliá Hotels International, Spain’s largest hotel company, which manages eleven lodges in the Magaluf area. Since 2012, Meliá has invested around €250m in the resort.
“Collaboration between private entities and the public administration has allowed us to see this dream coming true,” Meliá’s CEO and vice-president Gabriel Escarrer said last July during the inauguration of The Plaza, a four-star located at Magaluf’s heart with a suspended rooftop pool and a 5,000m2 shopping area attached. Mr Escarrer claimed that Magaluf is an example of “repositioning of pioneer, mature destinations” that can be replicated in other resorts in Spain and elsewhere.
The strategy for the transformation of Magaluf was based on upgrading the hotel offer in order to aim for wealthier clients and drive out the “educationally inadequate” segment of tourists. That wave of change included urban improvements, increased police surveillance, a new shopping mall, and even boat parties being forbidden.
“Over 65% of hotels have been refurbished in recent years,” asserts Ángel González, the manager of BH Mallorca — one of Magaluf’s most known hotels — and two other lodgings. “Our past was based on youngsters who were not cost-effective. We need to position ourselves in the familial tourism market, not in the drunkenness market,” explains Mr González.
At one point, Magaluf’s infamous reputation sunk to depths so low tourism a name change was considered. Fortunately, the resort kept its denomination and the renovation plan is paying off: the presence of youngsters and students has dropped from 33% to 16% since 2013, according to the local hotel association.
Data on the hotel stock of the Calviá municipality shows the enormous extent of the transformation. Between 2012 and 2017, availability at four-star hotels surged by 86% to 24,500 beds, replacing the previous offer at 3-star ones (which plunged by 43% to 10,600). At the same time, the luxury segment, substantively boosted by the Zafiro Hotels’ Palmanova Palace opening, has taken off and doubled its stock from 578 to 1340 places.
“The industry has understood that it needs to invest if it wants to be competitive internationally,” says Mr Neumann. “We have come to the conclusion that either you change, or you die,” corroborates Mr González.
A global champion
But the transformation of Magaluf is not a unique event in Spain. The whole country wants to leave behind the label of being the cheap beach of Europe, and is now trying to upgrade its holiday offer in order to attract richer travellers and procure a more sustainable model. Doing so implies overcoming decades-old issues like the dependency on European travellers and the concentration of the activity in the summer and on the coast, but also tackling recent problems like those caused by urban tourism and Airbnb-like platforms.
Spanish politicians often talk about the need to build “quality tourism” as a way of levelling off overcrowding while retaining revenues. Exceltur, the lobby that represents the Spanish largest hotels, acknowledged in a recent report that the future of the industry “should not be based on larger flows of tourists per se”, but on attracting those segments of travellers that are most “desirable” and generate the most revenues.
Tourism powers a significant portion of Spain’s economy. It contributes, directly and indirectly, 14.9% of the national GDP and generates over 15% of jobs. Economist and conservative MP candidate Daniel Lacalle described tourism as the “oil of our country”.
The significance of tourism in Spain is demonstrated, for instance, through the organization of international events. Fitur, an international tourism fair attended by over 10,000 firms, is annually held in Madrid. In addition, Seville was chosen as the venue city of the World Travel and Tourism Council (WTTC) 2019 summit, whose guest of honour was Barack Obama.
At the summit, WTTC’s current chairman, Hilton CEO Christopher J. Nassetta, forecasted that €2.7bn will be invested in the Spanish tourism industry in the following years. “We are the world’s major tourism power,” the Prime Minister, Pedro Sánchez, added.
After welcoming almost 82 million foreign tourists in 2017, Spain outnumbered the U.S. and became the world’s second most visited country, just behind France. However, IPK, a German firm that awards a similar ranking, disagrees with the World Tourism Organization (WTO) and had Spain topping the list that year. Furthermore, the World Economic Forum (WEF) says that Spain is the most competitive holiday destination in the world.
But if you want to understand Spain’s current tourism success, you must look back sixty years ago, when it became a popular holiday destination for northern Europeans in the 1950s. At a moment when Spain was one of the poorest countries in the Old Continent, the influx of tourists with their foreign currencies provided a much-needed jolt of energy to Spain’s fledgling economy — back then, the country was reeling from the Franco regime. Consequently, a mass, low-cost tourism model — characterized by lack of planning and excessive localisation in time (the summer) and space (the Mediterranean coast and the Canary Islands) — emerged.
Magaluf, like Torremolinos (Málaga), Benidorm (Alicante) or Maspalomas (Tenerife), was one of the holiday resorts that mushroomed itself into existence along the Mediterranean coast and Canary Islands during the 1950s. Back then, the French weekly Paris Match coined the word “Balearization” — in honour of the Balearic Islands — as a way of referring to the uncontrolled urban development of coastal areas.
Despite the reluctance of some closed-economy advocates within the Francoist elite, Spain welcomed the tourism boom with open arms. The economist Manuel Funes Robert claimed back then that this industry had halved the Spanish economic history into “before tourism” and “after tourism”. Another analyst said that, as Europe had been rescued by the Marshall Plan, the Spanish economy was saved by the $11bn injection by tourists.
More recently, internal and global economic growth, low fuel prices and insecurity across Eastern Mediterranean countries have boosted Spanish tourism to all-time highs. As it once helped the Franco dictatorship to overcome economic depression, tourism has been widely acknowledged as the locomotive that drove the country through the 2008–2014 crisis. According to the lobby Exceltur, jobs within the tourism industry rose 13.4% between 2009 and 2016, while those provided by the rest of the economy declined by 6.2% during the same period.
That counter-cyclical behaviour is only possible because tourism is largely driven by foreign demand. For example, it was not impoverished Spaniards, but the emergent European middle class — geographical proximity to Western European developed countries has been a historical advantage — that allowed the tourism industry to flourish during the 1950s and 1960s.
And when the real-estate bubble burst in 2008, collapsing the country’s economy and pushing unemployment up to nearly 30%, it was not domestic consumption but external demand that enabled Spanish tourism to stay afloat.
Brexit and Germany: major threats amid the “return to normality”
Today, while other economic sectors struggle amid trade wars, the travel industry flexes its muscles worldwide. In 2018, tourism generated 10.4% of the global economy and provided 319 million jobs, the WTO estimated. As more and more people become richer across the developing countries and flight routes expand, the number of global travellers (1.3bn in 2017) increases on a yearly basis.
According to the WTO, overseas travels rose 6% across the world last year. The increase was driven by “a favourable economic environment and strong outbound demand from major source markets (countries of origin)”, the organization said in its yearbook.
Global growth was led by Northern Africa, a region that competes with Spain in offering beach-and-sun holidays to European travellers. Years of distress caused by political instability and terrorism seem to have vanished as Mediterranean Africa welcomed 10% more foreigners last year.
Previously, Spain had taken advantage of the insecurity and “borrowed” millions of tourists that otherwise would have chosen cheaper countries like Egypt or Turkey. That situation underlay the unusual 2016 (10.5%) and 2017 (8.7%) increases in travellers visiting Spain. In a similar way, arrivals to neighbouring Portugal tripled between 2010 (6.8m) and 2017 (21.2m).
However, Eastern Mediterranean countries are now recovering their market share. According to official data gathered by Exceltur, entries of internationals to Turkey surged 22% (or 7.8m tourists more) last year, increased by 44% in Egypt (3.6m more), and rose by 15% in Tunisia (1.1m more). The hotelier association estimates that those three destinations combined have gained over 25m new visitors in just two years.
Consequently, Spanish tourism took its foot off the accelerator last year as foreign arrivals (1.1%) and domestic travels (0.95%) stagnated. Experts describe it as a “return to normality”. The Canary Islands, which registered 3% less tourists and 2% less income in 2018, has been hit the hardest.
And then there is Brexit. As this is Spain’s main sender country — 18.5m travellers last year — the United Kingdom withdrawal from the European Union has been a cause of fears and concerns for the last three years. Insiders, however, express prudence rather than panic.
Founder and former director of the Spanish Tourism Institute (Turespaña), and for 11 years manager of the country’s Tourist Office in London, Ignacio Vasallo is one of the most expert voices on the ties that bind Britons and Spanish beaches. He believes that no major impacts will be felt: “The UK is already out of the euro and Schengen areas. In case a no-deal Brexit happens, both governments are already implementing backstops to secure air connections and the status of Britons residing in Spain.”
British affection for Spain is well-known. Besides travel statistics, around 300,000 UK citizens are inscribed as residents in the Mediterranean country. Last year, British people bought some 10,000 houses in Spain. Brexit is a threat for them, as it is for millions of Spaniards whose jobs depend on the UK market.
“Even in a worst-case scenario, I think that direct effects would be small.” However, a falling pound and a lower income per capita caused by a no-deal Brexit could affect British outbound tourism, acknowledges Mr Vasallo.
Indeed, despite Brexit, it was not the English who gave up most trips to Spain last year, but Germans. With 11.4m tourists sent last year, Germany remains Spain’s second source market. However, that means they were down by half a million compared with 2017.
Coupled with Germany’s stagnating economy, a lesser-known cultural hallmark contributed to the tourist decline: “There is a factor, very important in my view, which is the German habit of saving. Germans are more willing to spend their holidays in their home country, while in the UK the tradition of travelling to Southern Europe, particularly to Spain, is very deep-rooted,” said Mr Vasallo.
To make things worse, low-cost airline Germania filing for bankruptcy in February — coupled with Air Berlin’s closure in 2017 — has removed some “800,000 seats” in flights to Spain, Mr Vasallo estimates.
Aena, the company that operates Spanish airports, has reported that this summer there will be 2.8% less places available in flights between Germany and Spain. Conversely, despite Brexit, the offer with the UK grows 6.8% to 37m seats. Aena has also revealed strong increases in flying availability with Africa (25.7%), Asia-Pacific (16.5%), North America (14.6%), Latin America (14.7%) and the Middle East (12.4%).
‘Hola’, China
The opening of new flyways is essential for a country that wants to target new segments of tourists (otherwise, how would they come?). Not surprisingly, the development of both commercial aviation and international travel have gone hand in hand since the end of the World War II.
In Spain, visitors entering the country through airports accounted for only 8% in 1960. As the country built infrastructure and flying became cheaper and more available, that figure rose to 24% in 1980, to 74% in 2000, and to 82% in 2018.
Today’s flight networks allow Spain to be less dependent than ever on its traditional countries of origin — the UK, France and Germany. Last year, for the first time since records began, tourists coming from those three nations accounted for less than half of the total (49.9%). Only 17 years ago, in 2001, Britons, French and Germans represented 62% of all foreign visitors.
Conversely, Spaniards must now get ready to welcome more exotic travellers. Arrivals of tourists from India (+95%), China (+73%), Chile (+70%) and Korea (+57%) have boomed since 2016, just to cite the largest variation rates.
But those markets are insignificant compared to the United States, which sent almost three million tourists to Spain in 2018, one million more than in 2016. Statistics on the first months of 2019 envisage that American visitors will keep growing this year. Mr Vasallo, however, is sceptical about official data, pointing out that it may be inflated by the effect of cruise passengers.
But if there is one sender country which is now receiving much attention in Spain and elsewhere it is China. Since Iberia first flew between Madrid and Shanghai in 2016, over a dozen air routes connecting Chinese and Spanish soil have been inaugurated. Passengers using those flight paths rose by a further 28% in 2018.
Moreover, Aena is implementing a plan to attract even more Chinese travellers to Spanish airports. Those strategies include increasing the availability of Chinese products at vending machines, and installing hot water dispensers, mobile payment systems and billboards translated into Mandarin.
Droves of Chinese tourists that visit Spain annually are held in high regard because of their generosity. Aena estimates that, at the Madrid-Barajas airport, Chinese customers spend nine times more money than Europeans and 16 times more than Spaniards.
Data published by the Spanish National Statistics Institute (INE) states the expenditure gap between nationalities. Among Europeans, average daily expenditure per tourist varies from €87 (French) to €164 (Russians). Figures for visitors coming from further away, such as Americans (€246), Chinese (€292) and Japanese (€409), are considerably higher.
As expenses made before travelling such as flight tickets are included, some figures are inflated. The more distance a tourist travels, the more money she or he will spend overall. Common sense says, however, that those travellers will also be more generous spenders when they arrive and, hence, more appealing to the industry compared to Europeans.
Your best suite, please
Until now, Spain is finding ways to attract wealthy tourists. The question of hosting them is next. Because as Magaluf did in recent years, Spain has been upgrading its hotels.
Take a look at this: in July 1999, places at Spanish three-star hotels almost doubled the four-star stock. Nine years later, in July 2008, beds at four-star hotels matched those at three-star ones. Finally, during last summer, high-quality beds (four and five stars) outnumbered the rest of the Spanish hotel and hostel stock combined for the first time ever.
Disregarding alternative options such as holiday rentals and camping, more than half of Spanish hotels now belong to the high-end segment. And, as a lot of low-quality hotels are closed during the off-peak season, this proportion is even larger in winter. With some 924,000 beds offered during last year’s summer, Spain could now host the entire population of Amsterdam using just first-class and luxury dwelling.
And availability drives customers’ choices. Nights spent at luxury hotels have increased, on average, 7.7% per year over the last decade — 272% since 2001! — slightly faster than those at four-star dwelling (5.7%). In comparison, lower-quality hotels (0.1%) and hostels (-0.4%) stagnated during that period. Largely regarded as a low-cost destination in comparison with France, Italy or Switzerland, the Spanish tourism industry is finally catching up.
As for today, the recent tourism boom has allowed Spanish hotel companies to cash in and use those funds to further refurbish their facilities. According to the consultancy firm Colliers International, hotel investment in Spain grew by 23% to €4.8bn in 2018, an all-time high. Therefore, the average value of a Spanish five-star bedroom surged by 10% in the last year, Tinsa, a valuation firm, found.
But the most impressive projects are not only five-star hotels. Riu Plaza España — four stars and 589 bedrooms across 26 floors — is set to open this summer at one of Madrid’s most emblematic and famous buildings: the neo-baroque Edificio España.
“All our hotels are important. However, due to its localization, history and the building’s grandness, we hope that the Plaza España will mark a before and an after for our brand’s popularity in Spain,” Riu Hotels internal sources said.
Riu, a family business founded in 1953, operates in twenty countries and is the fourth largest Spanish hotelier in terms of turnover (€2.2bn in 2017) and bedrooms (42,500). Just like other travel giants such as Iberostar, Globalia, Meliá and Barceló, Riu was also born on the island of Majorca.
The acquisition and posterior refurbishment of its new flagship hotel in the centre of Madrid has costed around €400m to the firm. Overall, Riu raised its investments to €870m in 2018, €200m more than expected, and it is projected to spend some €2.5bn until 2022.
“Our investment levels are only possible thanks to last years’ good performances, as we have gone through record-breaker times in terms of visitors,” Riu sources said.
Hotel development projects in Madrid are all over the city these days. Investment increased by 72% last year, to €600m. There are twelve high-end hotel projects in motion in the capital that, according to Knight Frank — a luxury real-estate agency –, will add some 1,200 new suites and settle Madrid as a major urban destination in Europe.
The rise of urban tourism and Airbnb
When northern Europeans think about Spain they may picture sunny beaches. However, tourists from other parts of the world are showing more interest in cities. For instance, “Americans [visiting Spain] do not go to the beach. They already have the Caribbean”, Mr Vasallo points out.
Huge flows of urban tourists are considered a relative novelty in most Spanish towns. When the industry took off in the sixties, early travellers were not attracted to visit impoverished cities ruled by the conservative standards of the “national-Catholic” Francoist ideology. However, the economic and democratic development of Spain and the arrival of travellers with different interests radically changed that, allowing urban tourism to flourish.
Urban travels have surged particularly fast during recent years, giving rise to concerns about overcrowding and touristification, a term that may be defined as “tourism-driven gentrification”. Since 2008, nights spent by foreigners in hotels have tripled in Malaga (+197%) and doubled in San Sebastián (+131%), Seville (+113%), Alicante, Bilbao (+106% each) and Barcelona (+97%).
With 15.8m tourists welcomed last year, the Catalan capital has become a leading European destination, but also the scene of sporadic “tourism-phobic” demonstrations. In June 2017, the neighbours of Barcelona said that tourism was the city’s most important problem, with 60% of them agreeing that the activity was reaching its limit, an official survey found.
The incumbent mayor of Barcelona, Ada Colau, spearheads the movement to limit tourism in Spain. The local government, supported by leftist parties, passed in January 2017 an unprecedented law that planned tourism decrease in central neighbourhoods like El Raval, La Barceloneta, El Poble Sec and the Gothic Quarter. Not a single hotel can now be opened there, not even for the sake of replacing old ones. In addition, it freezes professional lodging offer across a second ring, pushing new hotels to the periphery of the city.
Ms Colau’s crosshairs not only took aim at professional lodging, but less formal ones. She, like other city leaders across the globe, set sights on regulating the world’s largest hospitality company: Airbnb. Without owning a single hotel, the Airbnb marketplace offers more than six million bedrooms worldwide — more than Marriott, Hilton, InterContinental and Wyndham combined — and hosts some two million people every night.
In Spain, 3.6m tourists used this home-sharing platform to find lodging last summer. Barcelona (up to 21,600 apartments advertised) and Madrid (14,900) are among the top-10 European cities with the most Airbnb listings.
It is known that technology always runs ahead of regulations: the Airbnb phenomenon has forced Spanish politicians to catch up and adapt housing and tourism legislation. In Barcelona, Ms Colau frozen new holiday rental licenses, created a specialised team of inspectors — which the council claims have closed 95% of the non-licensed accommodation — and even imposed a €600,000 sanction on Airbnb and HomeAway because of their lack of collaboration.
As the responsibility to regulate holiday rental falls to regional and local governments, Spanish legislation is inconsistent across the country. That does not make laws softer, but rather the opposite.
The capital of the Balearic Islands, Palma de Mallorca, became in April 2018 the first Spanish city to ban any kind of holiday rental in apartment blocks — only single-family buildings such as villas and country houses can now be granted licenses. Data scrapped by AirDNA shows that, so far, the law is having effects: listings plunged by more than 40% between the summers of 2017 and 2018.
The mayor of Palma, Antoni Noguera, is being investigated by a court on grounds of abuse of authority regarding this law after the Spanish Federation of Holiday Rentals Associations (FEVITUR) filed a criminal complaint against him.
More recently, Madrid has gone even further. The Spanish capital expects to shut down over 10,000 holiday rentals — 95% of the current stock — as it requires them to have a separated street access in order to be offered for more than 90 days a year. Airbnb has described the ruling as “not clear enough”, “unfair” and “disproportionate”. Holiday rental associations have appealed against it.
José Manuel Calvo, Councillor for Sustainable Development at the Madrid local government, justified the new law saying that it will “preserve urban soil for residential use” and stop the kind of tourism that “does not generate added value” and turns the city centre into a “theme park”. The national government shares a similar stance. In front of the industry’s elite gathered at the Fitur tourism fair, Pedro Sánchez advocated in January for a “sustainable” industry that “respects the growth of our cities and its own identity”, avoiding “economic and social malfunctions”.
Voices pointing to the risks entailed by Airbnb-type platforms are not few. The political left and social movements such as neighbourhood associations argue that, as holiday rentals remove supply from the long-term housing market, the arrival of Airbnb causes further increases in rental prices. Additionally, they say, excessive tourism disturbs neighbours’ coexistence and displaces traditional businesses, a new form of gentrification that researchers have named ‘touristification’.
Jaume Adrover, spokesman for Terraferida (‘Harmed Land’, in Catalan), an environmental group based in Majorca, claims that “Airbnb remains a problem” despite the law passed by the Palma city council. “As its accommodation stock constantly increases, houses are being transformed into tourism businesses and more real-estate is being built, adding further urban pressure” on the environment, Mr Adrover says.
Links between tourism and distress in the housing market are particularly visible in Ibiza, where some cases of seasonal workers sleeping in vehicles or garages have been reported. In 2017, a group of doctors had to be hosted in an old hospital because of the lack of affordable housing in summer.
Pressure to clamp down on holiday rentals also comes from the hotel industry. Believe it or not, Airbnb has led businesspeople to join forces with left-wing politicians. The hotel lobby Exceltur has urged public officers to monitor the compliance with new holiday rental legislation in order to avoid “externalities and potential tourism-phobias derived from uncontrolled growth”.
They also point to unfair competition — some holiday rentals are not licensed and do not pay taxes — and the lower income generated by home-sharing platform users. According to the INE, holiday rental users’ average daily expenditure was €118 in 2017, compared to hotel hosts’ €185.
However, holiday rental associations and platforms have found a powerful ally: the National Commission on Markets and Competition (CNMC). The Spanish competition watchdog has filed appeals against laws passed by the local governments of Madrid, Bilbao and San Sebastian; and the regional governments of the Canary Islands, Galicia and Castile-León.
Moreover, the CNMC launched a report in August 2018 claiming that “there exists no evidence of a direct and exclusive correlation between holiday rental supply and housing prices”. In declarations to EFE, the vice president of Exceltur dismissed the watchdog’s arguments as “very empty” and “little substantiated”.
Delocalisation, but also de-seasonalisation
The debate over Airbnb across Spanish cities demonstrates that the industry is not limited to be a coastal, summer activity anymore. From the Camino de Santiago to the mountains of Aragon, from the windmills of Castile La Mancha to Game of Thrones’ Dragonstone location on the Basque coast, Spanish holiday destinations are now more diverse than ever.
Hotel data confirms that trend. While nights spent on the Mediterranean regions (Catalonia, Valencian Community, Murcia and Andalusia) and the Canary Islands increased by 16% between 2013 and 2018, the growth rate for inland and northern Spain was double (32%) during that period. Now, the tourism yield is escaping the Mediterranean coast and spreading across the rest of the country.
The Basque Country, located in the rainy north of the Iberic Peninsula, is one of the spots where new forms of tourism are flourishing. Boosted by the excellent reputation of its cuisine — the region is home to eight Michelin-starred restaurants — hotel overnights spent have surged by 56% in the last decade, the strongest figure among the seventeen Spanish autonomous communities.
“What is succeeding here is quality tourism based on our strengths: gastronomy, culture and nature — sea and mountain,” says Juan del Hoyo, president of ATRAE, an association of Basque travel agencies.
But the Spanish willingness to boost green and cultural tourism is not new. Paradores, a state-owned hotel company, was founded back in 1929 by the King Alfonso XIII — a nature lover himself — as a means to build a then non-existent hospitality industry. Nowadays, the firm manages 95 hotels mainly located in historical buildings such as castles, monasteries and palaces, or next to national parks.
In any case, the Mediterranean regions and the Canary archipelago retained 71% of hotel nights last year. That share is only slightly lower than 1999’s 73.9%, hence the industry remains dependent on sea and sand. “Spain is upgrading the quality of its tourists, rather than substituting the model — it is just improving it,” Ignacio Vasallo says.
During the last few years, the demographic decline of the so-called ‘empty Spain’ has entered the public debate, and rural tourism is seen by some as a way of boosting economic activity in such areas. The Spanish ruling party, the PSOE, promised in its electoral programme that it will promote “inland sustainable tourism as a driver of revenue for fighting against depopulation”. Similarly, the People’s Party (PP) said it would “fiscally incentivise young employment undertaking (…) tourism activities in rural areas”.
Besides, spreading out the tourism activity across the country causes a secondary, equally important effect: it also de-seasonalises it. Unlike enjoying a beach, urban and cultural tourism is less dependent on weather. Therefore, as alternative holiday destinations surge, tourism becomes more evenly distributed across the twelve months of the year.
Indeed, for the last five years, hotel overnights occurring between October and May increased by 24%, compared to summer’s 14% growth. Historically, excessive seasonality has harmed not only the job market — fostering temporary employment — but also the finances of local rulers that have to face short-term, extremely high demands of services such as road transport, water supply and urban security.
From quantity to quality
In 1980, the academic Richard W. Butler proposed a “tourism life cycle model”. He argued that “overuse and the impacts of visitors” would eventually cause the decline of mass destinations. Inspired by those ideas, some analysts predicted the failure of the Spanish Magaluf-like, sun-and-beach model. Yet, as the case of Benidorm demonstrates, Spanish resorts age well.
Tomás Mazón, tourism sociology professor at the University of Alicante, warns that analysing Spanish coastal destinations as if they were all the same is a “huge mistake”, as it is to take Butler’s too literally. Mr Mazón takes Benidorm and Torrevieja as an example: two resort towns located in the Alicante province “whose urban development and tourism models are completely antagonistic”.
Torrevieja is a paradigm of residential tourism — an activity based on real-estate development that poses several risks to local economies and the environment. Although only 85,000 people being registered in the census, Torrevieja’s population surges to 320,000 in summer. Benidorm, however, is quite the opposite. With more than 21,000 bedrooms, compared to Torrevieja’s 1,700, this city owes its success to its numerous hotel accommodations. Indeed, 11.5m nights were spent at Benidorm hotels in 2018, the fourth largest figure across Spain. Such an economy of scale allows the resort to maintain good relationships with the largest European tour operators. “They are the guarantors for the large number of tourists that go to Benidorm,” Mr Mazón explains.
While year after year Spanish resorts prove its ability to attract millions of tourists, issues about labour and workers’ welfare still plague the industry. According to the HR firm Adecco, the average monthly wage within hostelry was €1,063 in 2017, the lowest among the 18 economic activities analysed. And, on top of that, there is the excessive seasonality of most tourism jobs.
Poor working conditions have been highlighted by the group that suffers the worst across the industry: the hotel maids. They call themselves ‘Las Kellys’ (“the ones that clean”) and, in April 2018, they presented their demands at the Moncloa Palace to the then Prime Minister, Mariano Rajoy. Those include the right to early retirement, recognition of specific occupational diseases and the inclusion of working conditions as a factor that can affect the category of hotels.
Lloret de Mar, one of the most visited resorts in the Costa Brava, is an example of how tourism does not always bring welfare. In 2016, Lloret became the Catalonian municipality with the lowest disposable household income — €10,900, which only accounts for the 65% of the regional average. Back in 2015, data gathered by AIS — an IT consultancy firm — found that eight of the ten poorest Catalan towns were in the Costa Brava and the Costa Daurada tourist areas.
But, as Mr Mazón says, each resort is different. Unlike Lloret de Mar, Calviá — where Magaluf is located — is among the richest 2% Spanish municipalities as measured by GDP per capita. The professor points to the role of civil servants in attracting investment and private capital; or, conversely, in acting as an obstacle. As the case of Magaluf shows, local managers and politicians make the difference.
Down there, on a warm January afternoon, the empty streets of Magaluf — almost only the Palmanova Palace remains open during the off-peak season — have a peaceful atmosphere, like the calm before the (summer) storm. “Winter is winter. We do not aim to be open 365 days, but at least for nine months,” Ángel González says.
Sitting in an office located next to the football pitches where Marco Asensio, the Real Madrid star, used to play as a child, the hotelier wishes “that in a few years Magaluf will look completely different and become one of the best resorts in Europe”. No kidding. He reflects the self-confidence of an industry that, both in Majorca and in Spain, is set to break old boundaries.
“That is what we want,” Mr González summarizes. “To attract better customers, to provide better services, and for people to have fun.”
