The Slow Pace Of Modernisation: Hotels

Getting an exact figure for the number of hotels in the Balearics is a straightforward task. If you are of a mind to go to the tourism ministry's website, you will find spreadsheets for "types of establishment" for each year from 2004 up to 2012. One has to know what the abbreviations mean in order to understand what is what, but the total number of establishments is (was in 2012) 2,591. Of these, 711 are hotels from one-star to five-star-plus and 241 are hotel apartments. In addition, there are 863 apartments, which are different to hotel apartments, and which are rated according to the key system rather than the stars.

When one looks at the star ratings for 2004 and 2012, it is noticeable that there hasn't been an especially significant change where the core 3-star hotel is concerned. There were 371 hotels (excluding hotel apartments) in 2004. In 2012, there were 354, of which two were 3-star superior (a category that didn't exist in 2004). The number of 5-star hotels rose by eleven to 34, while the biggest mover was the 4-star: 204 in 2012 versus 150 in 2004.

The 2012 tourism law placed a great deal of emphasis on modernisation and renewal. Since it was passed, there have been 215 applications for an increase in star (or key) ratings, and over half of these have been applications to upgrade to 4-star, to 4-star superior or to 5-star. 65 3-stars are seeking 4-star status, 41 want 4-star superior status and four are seeking a 5-star rating. These applications represent, therefore, what is perhaps the single most significant rise in hotel standards there has ever been.

Overwhelmingly, the hotels seeking upgrades are located in Palma and Calvia where, respectively, there are applications for 40 and 38 increases. Nowhere else comes close, which probably reflects the fact that Palma and Calvia have considerably more hotels anyway. But to take one municipality - Alcúdia, with at least 70 hotels and apartments, there are only six applications. This seems on the low side. Capdepera has 13, Sant Llorenç has 11 and Pollensa ten.

While this all suggests a commitment, in line with the modernisation drive envisaged under the tourism law, to greater quality and improved standards, there are questions that need asking. One is why it takes such a hell of a long time to approve the applications, and the other is whether the implication of higher prices that come with superior hotels will actually result in greater profitability.

The procedures for gaining approval and for the granting of licences in order to permit renovation are notoriously slow and complex. So far, of the 110 applications for 4-star and 5-star status, a mere 26 have been agreed to (three have been declined). At the current rate of progress, therefore, it will be the end of 2016 before all the applications have been dealt with. The tourism ministry, conscious of the need to get a move on, says that it will do just this, but in the meantime, one does have to wonder if work is being undertaken without the necessary agreements. This was an issue that was highlighted when the upper floors of the Son Moll hotel in Cala Rajada collapsed during renovation work at the end of 2008. The death of four workers was not attributed to the absence of the proper licence, but the Son Moll incident showed that renovation was commonly done without licences being in place because of the time it took for them to be agreed.

If bureaucracy is holding things up, then the tourism ministry (and also town halls, which do have a say in all this) need rockets being put under them. It makes little sense to put in place a strategy of modernisation only for improvements to be delayed because there is either an insufficient number of technicians to sign off on plans or because there is too much red tape. The ministry, indeed the Balearic Government in the form of President Bauzá, had said that processes would be streamlined.

As for greater profitability from 4-star or 5-star establishments, the mere fact that prices are put up simply because of the number of stars on a plaque outside a hotel do not necessarily mean greater profitability. Just as an indication, figures for the Hoteliers Price Index, one compiled by the Spanish National Statistics Office, showed last year that only 5-star hotels had in fact registered an increase in revenues per room. And there is a further issue when it comes to raising prices because of an upgrade in star rating. In competitor destinations, Greece for instance, prices have been going down. Mallorca's hoteliers might hope that they can compete on improved quality and so demand higher prices, but they might find themselves thwarted in this hope by market conditions.

Improving hotel standards is very welcome, but we shouldn't get carried away. 110 establishments equate to only roughly 10% of hotels and hotel apartments, and this improvement is a case of catch-up with elsewhere where 4-star, if not 5-star, is the norm. In the Balearics, the 3-star remains king.