Thursday, December 14, 2017

Something Over 100 Million: The Palacio

So, what do you reckon to the Palacio? Not do you like the look of it - subjectivity is a great thing but not terribly objective - but is it proving to be worth all the palaver after all? To answer this, you'll have to take Meliá's word. No losses for the first year (only nine months), and a decent profit expected to be turned in next year, presumably after handing over the annual couple of million or so to the town hall and government - the Palacio company.

Things do seem to have gone quite well, surprisingly well, some of us may conclude. Volkswagen was a nice way to cap off the year, what with all those attendees being bused hither and thither by German coach operators. Single Market, what Single Market? There are such matters as Balearic regulations on transport operators. Hence the coaches were parked up with nothing to do other than be passed by contented local coach operators, who had apparently failed to secure the original contract because they were too expensive (and whose federation raised the German question with the transport ministry). Hey ho.

Many were the sceptics, many a sceptic may remain, but once the edifice flung its doors open for the first time, it was an occasion to cast aside scepticism. The Palacio was a reality. Let's all back it. Long live the Palacio. Long live Meliá, who weren't presumably all that concerned about how much the place had cost. It wasn't their money after all. It was, erm, well, the taxpayers.

The doors open, however, and the bottomless well of taxpayer generosity was sealed over. How much had it really cost? The figures were somewhat movable. The general consensus was something over 100 million. Something over can mean anything. One report ventured 40 million over 100 million. We might never know.

It was of course explained to our old friend Jaume Matas in the days before the courts took an interest in him that the whole project was not viable in cost terms. Such cautions were not typically heeded by the former Balearic president. Have project, will fork out. Anyone for a metro and a velodrome while we're at it?

One could therefore understand why there were sceptical voices, yet the real rub as to how possibly good the Palacio could in fact turn out to be lay with Meliá's rivals for the management - the Barceló group. They had originally been awarded the contract. They went to court over the matter, sensing - one had to conclude - that there really was profit to be had overlooking the sea.

It was once suggested that the sea views were something of a drawback. Not just because the location upped the cost but also because of running costs, such as those for cleaning the windows and the exterior, having received a good buffeting from Cyclone Ana (or just regular weather and general seaside air). But these costs are clearly no longer a concern. The Palacio has risen and its stock will rise ever higher. And I have to say good if it does. It genuinely could make a very valuable contribution, which is just as well given the 100 million or something over.

Right now, the Palacio is hosting those for whom its angular formations can only be wonders to behold. The Palacio - of men, Meliá and mice. The MICE sector - MICE as in meetings, incentives, conferences and exhibitions - has been gathering within it. The Balearic Tourism Agency has even deigned to provide its patronage. Well, it would. The Palacio is better in winter, and for once the agency may well be right.

The MICE sector has gone to worship at the shrine to its future wealth. And why not? Its wealth and the wealth of others. I was once among the sceptics, oh most certainly, but not now. One senses that the Palacio is going to prove to be a roaring success, and if this were to rub off in general terms, then it can surely only be good. You never know, it might prove to be the means of unlocking the keys to low-season flights from those parts of Europe cut off from Mallorca for months on end.

There are reasons, however, to quieten the euphoria. One in particular is the nature of competition. A short-term again for Palma may be had from the little local difficulty in Catalonia and therefore the main MICE centre in Spain - Barcelona. But there are other cities. Valencia, for one. And what are they up to in Valencia? They're only going and positioning themselves as a 365-day-a-year city destination, and, moreover, the Valencia Convention Bureau is on the prowl.

The point is that everyone does the same and chases the same sort of markets. For Palma and the Palacio, therefore, the current fashionability needs to be maintained. If it is, then we should be grateful for the 100 million or something over.

* Image from

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