By Euro Weekly News Media • 06 October 2011 • 9:49
OWNERS of hotels have in Alicante Province have been forced to drop the leasing costs by up to 50 per cent to prevent them from closing.
On average, around 100 hotel owners in the province have dropped these fees by 50 per cent in the past three years.
There are 345 hotels in Alicante Province, which can accommodate 69,000 people in total. A quarter of these are leased, mainly to hotel chains. The fall in profit has led to hotel room prices being lowered, and cost-cutting excercises to keep overheads down.
Hotel leasing prices vary depending on the star rating and location, and are calculated per room.
The lease for a four-star city hotel with 100 rooms, can cost between €600,000 and €1 million per year, although before the financial crisis, this figure was closer to €1.5 million.
If the hotel is in a holiday resort, the average price is lower, about €400,000, according to sources within the sector. The Costa Blanca has maintained relatively strong hotel occupancy levels this summer of around 88 per cent in July and August.
This has partly been attributed to the knock-on effect of north African unrest on tourism in Tunisia and Egypt at the beginning of 2011, which led to holidaymakers swapping holidays for ‘safer’ destinations.
Over the August 15 bank holiday, occupancy levels were up to 100 per cent, although prices have fallen and hoteliers are not making the money they would have done three years ago.
Since the recession began, the number of hotels leased for a fixed rent has decreased. It has become more commonplace if for a set lower annual lease costs plus performance based fees, according to a report from consulter Magma Tourism.
The Husa Golf on Playa de San Juan, Melia Benidorm, Holiday Inns, Eurostar Lucentum, Mediterranean Plaza and most of the NH and AC chain hotels are leased.
In Benidorm, most hotels are operated by proprietors.
By Jennifer Leighfield
Share this story
Subscribe to our Euro Weekly News alerts to get the latest stories into your inbox!
By signing up, you will create a Euro Weekly News account if you donâ€™t already have one. Review our
Share your story with us by emailing [email protected], by calling +34 951 38 61 61 or by messaging our Facebook page www.facebook.com/EuroWeeklyNews
Download our media pack in either English or Spanish.