Europe -  Barcelona, Spain

Barcelona has established itself as a favourite short-break leisure destination in line with cities such as Paris, London and Amsterdam. It has a wealth of cultural attractions, including a well-preserved medieval centre, and a reputation for being a centre of modern and avant-garde art. The city boasts a vast cultural heritage of Catalan architect Antoni Gaudí, as well as other notable Catalan artists such as Joan Miró and Salvador Dalí. Barcelona is also an important banking and financial centre, and its transport links and proximity to France have helped to attract considerable foreign investment. In addition, Barcelona is a growing centre for meeting, incentive, conference and exhibition (MICE) business as well as becoming an increasingly important port of call for cruise ships.

Tourism arrivals have been growing at a steady pace over the last few years (a 6.0% increase in airport arrivals in 2018), but tourism might soon face a cap as Barcelona is flooded each summer by day trippers from nearby beach destinations and cruise ships.

In May 2015, Ada Colau was elected as the new mayor of the city of Barcelona. Leading a coalition of environmentalists and social activists, she announced that the city’s tourism strategy would change radically to ensure more ‘quality tourism’. As a first step, in July 2015 the mayor placed a moratorium on approving new hotel developments and short-term rentals; this tourism moratorium was extended in 2016 for an additional year. Eventually, in March 2017, the moratorium was substituted with the Special Tourist Accommodation Plan (PEUAT), which was approved by Full Council on 27 January 2017. The PEUAT sustains the purpose of the moratorium, regulating the introduction of tourist accommodation establishments, as well as youth hotels, collective residences with temporary accommodation and tourist apartments. According to Ms Colau, this regulation allows for a sustainable and responsible tourism model and helps reduce the pressure on the most saturated neighbourhoods in the city.

The city’s tourism and hotel market was hit by the global financial downturn; however, it was able to recover quicker than other Spanish markets. As a result, marketwide RevPAR only experienced a decrease in 2008 and 2009, and from then until 2017 it increased at an average rate of around 5.0%, powered by increases in both occupancy and average rate. RevPAR changes in 2015 and 2016 were especially significant, at around 10.0% each year. However, given the current social and political situation in Catalonia, with the upheaval created by the independence movement, the hotel sector was somewhat impacted in 2017 and more drastically affected in 2018. The civil unrest and demonstrations that followed the 1 October 2017 Catalan Independence Referendum had a direct impact on tourism and resulted in performance declines for 2018. Although occupancy levels remained stable during this period, this was to the detriment of average rate, which dropped by around 4.0%. The conference segment was the most affected as events tend to be booked some time in advance and several chose a more stable destination. Overall, and due to the current political instability, Barcelona recorded a 4.9% decrease in hotel values in 2018.

There is still a palpable fear that sustained political instability will continue to negatively affect the Catalan region and Spain overall. Nonetheless, Barcelona remains one of the most successful European short-break destinations and is likely to stay as such over the years to come, regardless of the political and governmental changes that may lie ahead. In addition, given the aforementioned PEUAT, the pipeline situation in Barcelona’s city centre remains uncertain. The few projects that have planning permission will enter the market in 2019, with the future for new hotels thereafter remaining relatively uncertain. Furthermore, illegal tourism rental apartments might soon face heavy fines or closure, which will further decrease the accommodation capacity of the city. To a certain extent, this could be beneficial for existing hotels.

From a transactions perspective, the city has remained relatively liquid in the past year. The 100-room Barcelona EDITION transacted in 2018 for an undisclosed sum. In addition, several other properties transacted as part of a portfolio, including the 70-room Hotel Hesperia Ramblas (part of the Hispania Portfolio), the 90-room Exe Barcelona Gate (part of the Banco Sabadell Hotel Portfolio) and the 75-room Hotel Miramar Barcelona and 70-room Gran Hotel La Florida (part of the Colony Northstar Acquisition of CPI).

Change In Value For Market: (€Euro)

Legend
Significant Value Increase: Greater than +10%
Moderate Value Increase: Between +3% and +10%
Stable Values: Between -3% and +3%
Moderate Value Decline: Between -3% and -10%
Significant Value Decline: Less than -10%

Barcelona RevPAR Change (€Euro)

Barcelona RevPAR (€Euro)

For more information, please contact:

Sophie Perret, MRICS, MBA
[email protected]
  • +44 20 7878 7722 (w)
Magali Castells
[email protected]
  • +44 20 7878-7710 (w)
  • +44 7 850205149 (m)