Spanish property groups are increasingly invading the Algarve, snapping up building developments. Negotiations are currently underway for the sale of Lusotur, one of the biggest Portuguese tourist real estate companies, belonging to the group led by mogul André Jordan. Spanish firm Prasa is said to be in the process of buying the company, keen on making inroads into Portuguese real estate.
The Prasa group, which is based in the Andalusian city of Cordoba, is already the owner of various tourist villages in the Algarve. These include developments such as Monte Laguna (188 apartments), Los Olivos del Golfe, (72 apartments) and the Los Arcos development, in the centre of Vilamoura, which is currently in the process of being handed over to clients.
Questioned over the Spanish invasion, Elidérico Viegas, from the Association of Hotels and Tourist Establishments in the Algarve (AHETA) says commentators should not overstate the ‘take-over’. “The purchase of Lusotur by Prasa has not yet been finalised. We are going to see how things evolve,” he noted.
Viegas also pointed to differences in the fiscal systems and administrative procedures between the two countries. In the Algarve, the approval of the construction of a hotel can take many years, but in Spain the maximum length of time to obtain planning permission is six months. Examples abound of Algarvean tardiness in approving projects. There is the case of a tourist village with a golf course that a Finnish group has been trying to construct in the interior of the concelho of Loulé. The application has been dragging on for many years without any response from Portuguese authorities. Among others currently awaiting a decision from the Portuguese authorities are 15 major tourist projects in this region, all investments above 15 million euros.
Viegas claims that the Spanish, ever attentive to the developing situation, tend to overcome bureaucratic obstacles more easily by forging networks of contacts. He believes that opportunities for Spanish investment in the Algarve have also opened up in recent years because of improvement to roads and infrastructure.
