A Record Year of Hotel Investment
Hotel investment in Spain amounted to € 2,614 million in 2015, an investment 2.4 times higher than in 2014. The sun & beach segment remains the main focus of investment and represents 54% of the total. Geographically, the intense investment activity in the Canary Islands stands out, where the invested volume quintupled over the previous year, reaching €683 million (increase of € 547 million) and placing the archipelago as the most profitable Community with 12% more investment compared to 2014.
In total, the Islands attracted 28% of total investment in 2015 and accounted for 33.2% of total hotel rooms. The province of Las Palmas was particularly favoured, accounting for 21% of the total investment in Spain, with € 519 million to the detriment of Santa Cruz de Tenerife, down two percentage points compared to 2014 and presented a total investment of € 164,5 million in relation to the Spanish total investment.
The investment activity was dominated by domestic investors such as the hotel chain H10 or the SOCIMI Hispania (with the acquisition of the Gran Hotel Atlantis for € 105 million). Although to a lesser extent European investment also featured, with the purchase of the Altamanera and Catarina Hotels for € 47.8 million by the German IFA Hotel & Touristik group. Also, a Chinese investment group took over the Barceló Santiago de Tenerife (406 rooms) for an undisclosed amount.
Outlook
After more than 40 years of tourism on the islands, focused mainly on the sun and beach sector, the most important challenges faced by the islands are hotel innovation and diversification in new products/segments such as sport. In the 2016 Marketing Plan for the islands, budget allocations have been assigned to sectors such as Active Tourism or Weddings and Honeymoons.
Tourism product innovation, closely linked to the renovation of the hotel industry, highlights sustainability as a primary aspect valued increasingly by tourists and customers. As an example, Lanzarote has become the first destination in the world to obtain the Biosphere Responsible Tourism certification, recognised by the Global Sustainable Tourism Council, which provides a global system of recognition, approval and accreditation in certification programmes for sustainable tourism.
Training and employment remain important challenges as according to official data, 83% of job seekers in this sector are only credited with a maximum of Secondary Education. Contrary to what occurs in other sun and beach destinations, the Canary Islands benefit from the advantage that tourism employment is steadily growing and is more stable than in other sun and beach destinations for not depending on the seasons. Finally, the role of the government will be key to both the renovation of the destinations (by urban improvement plans) and for the regularisation of issues of concern for the hotel industry, including new forms of holiday accommodation.