Playground Of The Rich? Mallorca's luxury tourism

The rich get richer and the tourism of the rich offers ever greater riches. Airtours, TUI's luxury tourism division, will be increasing the number of wealthy German tourists that it brings to Mallorca by 25% this year. As with the luxury property market - Engel & Völkers having recently issued positive forecasts for its German sales in the 4 to 8 million bracket - so luxury tourism refuses to succumb to the savaging of economic crisis.

Mallorca, despite competition from the likes of Sardinia, continues to hold an appeal to wealthy tourists, Germans in particular. The island is also benefiting from an increase in the niche gay luxury tourism market. The company Mallorca Luxury Gay has added a further element to its offer to gay tourists, that of high-quality dental treatment, in a bid to increase its market on the island for a tourism group that typically spends more significant amounts than the "straight" market.

Positive though this may seem, the luxury market, assuming one can arrive at an exact definition as to what it means, remains small. In Spain as a whole, according to a report in 2008, the luxury tourist, said to spend some 450 euros a day, was catered for by five-star accommodation that amounted to a mere 6% of all hotels. The spend equated to just over 7% of total tourism outlay.

One of the difficulties with increasing this market lies with the costs of creating the right type of hotel and of maintaining it. The prices that can be charged, high though they may be, do not necessarily result in high returns. The profitability of the luxury hotel, compared with other destinations, such as the Caribbean, is weighed down because it is simply that much more expensive to run it. This is exactly the same equation that dogs hotels' abilities to provide superior-quality all-inclusives such as those in Turkey where there are four individual categories of all-inclusive - from "classic" to "ultra class".

It is this price-quality-return conundrum which puts into some perspective the desire of the Mallorcan hotel federation to upgrade hotel stock. The luxury market may have deep pockets, but the market itself isn't so large that it can compensate for the investment needed to attract it. And there is a further issue, one that has to do with where these hotels are located.

To take an example, in Playa de Muro there are 33 hotels, three of which are five star and several more of which are excellent four star. An up-market image of hotels is not, despite a fine beach, matched by what else the resort has to offer, namely parts of it in a state of virtual abandonment and, with the greatest of respect, a lack of genuinely quality restaurants. Rather, you have an almost uniform offer of the standard "grill" and pizzeria.

The restaurants are caught in a dilemma. They may wish to invest, may wish to change their cuisine, but to what end? They have come to realise full well that the image of all-inclusive being exclusively for the economy-class tourist is something of a myth. It only partially applies in Playa de Muro, and in a wider context it is applying less and less; demand for all-inclusive within the higher, 4-star end of the market has increased and is likely to go on increasing if what exists outside hotels is unable to match this market's more sophisticated tastes, assuming that the hotels can actually deliver the required service. But do the restaurants adapt to try and capture this market when they fear that such effort will be undermined by the all-inclusive offer?

What is on offer in restaurants is, though, an important ingredient when it comes to the luxury market. All the attention that is paid to some of the "alternative" tourism offers, notably gastronomy and golf, is understandable if this market is to grow significantly. Both these are cited as important aspects of attracting the luxury market. In Playa de Muro, the obstacles to the building of the golf course on the Son Bosc finca are seen as detrimental to the expansion of the market.

Crucially, however, the question is whether this luxury market will grow significantly and whether the investment to make it grow will be matched by results. There is, and has long been, an element of wishful thinking, some of which is now being turned towards the nouveau riche of Russia and eastern Europe. Nevertheless, if TUI is increasing the number of its minted Germans, then there is cause for some gentle optimism.

The issue will be whether Mallorca has the quality of hotel and, as importantly, quality of resort to make anything like a quantum leap. And, as has been seen with Playa de Palma, the hoteliers, pressing for upgrades and the removal of bureaucratic hoops that would facilitate them, contradict themselves by insisting (not unreasonably) that the bread and butter remains the 3-star mass tourist.

And there is lurking perhaps an additional issue, a social one. Mention of Sardinia as a competitor to Mallorca in the luxury market is a reminder of what surfaced there back in 2008. Wealthy and celebrity tourists being greeted with barrages of wet sand and cries of "louts, go home" as their motorised dinghies came ashore.

Wealth is very welcome, but in times of deprivation, more of it, ostentatiously on show, does not guarantee a welcome.


Any comments to andrew@thealcudiaguide.com please.

Lost In France

Bet you didn’t realise that Balearic president, Francesc Antich, yesterday also became a “European” president: you wouldn’t be alone. Antich has assumed the presidency of the so-called “Eurorregion”, a political grouping that obscure that many here couldn’t tell you what it was. To explain: the Eurorregion comprises parts of south-eastern France, north-eastern Spain and the Balearics. Its general objective is to defend the interests of the regions within the European Union: it met yesterday in Toulouse. This may well be its objective, but in truth what on Earth is the point of it? I am not alone in wondering. The president of one of the participating regions, Languedoc-Roussillon in France, reckons that the group signifies nothing and that unless something positive happens over the next twelve months it will drop out, joining Aragon which has already taken its bat home following a disagreement with Catalonia. This particular “Eurorregion” is just one of many across Europe. As established by the Council of Europe, they are meant not to have political power.

Antich, according to “Ultima Hora”, wants the Eurorregion to become an area of co-operation with its own legal status to lobby for EU grants. But, other than neighbourliness, what common ground is there within this group? It is not a Catalan-speaking coalition, even though there are some Catalan speakers in southern France. Were it so, with the politico-linguistic overtones that would have, then one could see some logic, but – at the political level – the Balearics have their own beef with Catalonia over the latter’s drive for greater autonomy which could see less money from rich Catalonia entering the Spanish pot for divvying up to other parts, e.g. the Balearics. Moreover, there are already collective groupings for these regions – they are known as France and Spain – which compete for Brussels money. The Balearics make up an autonomous region of Spain with representatives in Madrid for the precise purpose of securing adequate funding, be it national or European. What can a cross-national grouping of neighbours hope to achieve in terms of climbing the Brussels cash mountain that a national government cannot? There is some reference to tourism, but again where is the common ground? It might be remembered that the tourist centres of the Languedoc, such as Cap d’Agde, were created partly because the French were hacked off with Germans and others driving past them into Spain.

Some of the euro regions have a logic. The Benelux grouping is one with a history, the one that joins Kent to France and Belgium via the Channel Tunnel has a clear rationale. But the Balearics one? The whole thing smacks of being little more than a talking-shop, an opportunity for local politicians to play on an international stage, albeit one stripped of lighting, curtains, a coherent plot and with an empty auditorium. Sorry, I don’t get it, nor it seems does the president of Languedoc-Roussillon.


Still in France. Another tourism/travel fair. In Cannes. This is unashamedly pitched at the luxury-tourism market, its name International Luxury Travel: you can’t get much clearer than that. Thirteen Mallorcan businesses, mainly top-notch hotels, have joined the Mallorca council’s stand at the fair. Unlike the often misleading term quality tourism, luxury tourism is unequivocal: it stands for money and lots of it. The council is right to promote the luxurious nature of some of the island’s hotels. Here it is on firm ground. Where it is less so is on the cultural and gastronomic delights to support such luxury tourism. Which is not to deny these exist, just – as I have said before – they are largely hidden and do not enjoy a strong perception in the global tourist market. But, they are pushing the boat out at Cannes, so good luck to them.


QUIZ
Yesterday – Van Morrison, “And The Healing Has Begun”. Today’s title – song by?

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