The Transformation of Magaluf

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November 2015
By Carlos Martins
Vice President Mediterranean Region at Meliá Hotels International
Member of The Rooms Collection Advisory Board
 

50 years ago, Magaluf had already been discovered by  tourists: this  privileged corner in the South West of Mallorca  was once one of Europe’s favourite summer destinations during the 1970’s and 1980’s. Due to the combination of low-cost travel, the rise of new competitor destinations and the impact of the economic crisis,  Magaluf  started to suffer a progressive loss of upscale services, and the decline of upscale tourism in the area.


Melia Hotels International had been protagonist of Magaluf rise, and still held a dominant position in the destination: our Group, with its Head Office based in Mallorca and its beginnings- back in the Sixties’- linked deeply with Magaluf, operated over 3.500 rooms in the area. So, in the summer of 2011, when both the room rates, and the customers' segmentation, were at its worst, and Magaluf' s hotels were the less profitable ones of the whole Group, we took the challenge and committed to heavily invest on the destination, progressively involving other Companies and investors, as well as the Balearic and Local Institutions.


Our regeneration project, called “Calviá Beach”, included the renovation and/or rebranding of a total number of 11 hotels, plus the attraction of leading International leisure brands such as Nikki Beach, Wave House, Ibiza Rocks, Katmandu Park, etc, making up a whole new and transformed resort.  Our first movement was then to get the project declared of “Regional Interest” so we ensured the Public Administration’s support in order to move forward and remove paper-work barriers. After that, we created a  joint Venture with a local Partner to buy 2 additional quite worn- out Hotels in the seafront, which we transformed in two innovative, avant-garde lifestyle hotels like the Sol Wave House and the ME Mallorca Hotel, that dramatically changed the sea-front line of Magaluf.


Between 2012 and 2015, we have already renovated 9 hotels, investing a total of €130m so far, and we still have two important refurbishments & rebrandings to carry out along the next 2 years: the old “Sol Jamaica” hotel – now not operative- in the back-sea-front of the resort, that will become a gorgeous 4-star totally renovated hotel with top-class retail and leisure public areas, and the former Sol Antillas, a ( 400 rooms historical hotel with the best possible location of the Mediterranean, that will be rebranded as a Meliá hotel. Hopefully, by 2017, our Group will have invested over €190m and will have contributed to create a completely renovated resort in this South Beach corner of Mallorca.


A new “Sol” is rising

Along with the Calviá Beach project, Magaluf has also been the ideal scenario for Meliá Hotels International to develop another innovative project, aimed to revolutionize the resort segment:   the re-launch of the traditional “Sol Hotels” brand, now spread in 4 leisure-lifestyle hotel concepts, designed for different customer profiles: Sol House, Sol Beach House, Sol Katmandú Park & Resort, and Sol Hotels.


Specifically,  the project, jointly with the destination’s regeneration,  has made miracles in transforming well worn-out hotels such as the former Sol Magaluf into one lively, wonderful and successful family –oriented hotel + themed Park, the Sol Katmandú Park & resort, or in turning nondescriptive hotels frequented by young hooligans into leisure lifestyle  hotels for adults and couples with a like for the music, the sun and a more laid back holidays… and has even produced some of the most successful beach hotels in the Mediterranean, like the Sol Beach House Ibiza hotel, whose average room rates have increased by 60 % on direct sales and 35% on Tour Operations sales,  already in its first  season.


Above all, with this project and within the general renovation framework in Magaluf, Meliá is once again demonstrating that, thanks to innovation, Magaluf hotels and also mature destinations themselves can have a second chance .


Present and future of the resort

The transformation of a whole destination like Magaluf is a huge project that needs to involve the whole community, and we are more than happy to realize that now, 4 years after we launched the Calviá Beach project, the regeneration movement not only involves Meliá Hoteles International anymore, but more than 10 other private Companies, that  have acknowledged the potential of Magaluf, and are committed to the destination’s improvement. We also needed a clear commitment from the local and national Authorities, as  the urgency for renovation was not only evident in the deterioration of quality hotels, commercial facilities, and the decline of the urban environment. Most significantly the proliferation of businesses based on uncontrolled alcohol sales and the tolerance of antisocial behaviour resulted in high crime rates and a phenomenon known as “balconying”, whereby a person jumps from balcony to balcony, often tragically  falling to the ground in the attempt.  

Eventually, it was after the summer 2014 season that the public and private sector joined forces, alarmed by the image of Magaluf that was being portrayed to the world, as a paradise for young tourists’ excesses linked to the abuse of alcohol and drugs, and Authorities made a commitment to revise regulations and work began on an ambitious regeneration model. It is worth to mention that there was, for the first time in history,  a public statement that Majorca did not want that kind of marginal tourism.  

Due to the cooperation of local & national authorities, as well as the British Foreign Office, there has already been a significant turning of the tides in Magaluf. The 2015 season kicked off with a new set of regulations, Spanish and international police units assigned for law enforcement and an extensive educational campaign generating a dramatic fall in delinquency (only seven arrests compared to 23 in 2014), as well as 11 per cent less guests being forcibly removed from hotels for bad behaviour. Accidents from balcony falls, closely linked to excessive alcohol and drug consumption, also fell from 15 cases reported in 2014 to only five this year.

Although summer 2015 has thus  highlighted the success of measures introduced to improve public order and shed the resorts  image of ‘excess’, there is still significant progress to be made in Magaluf: we are at the very start of the journey. With support from like-minded investors, we strongly believe that it is time to restore Magaluf back to its former self.  Meliá Hotels International, jointly with the local and Balearic Authorities, and with the most important private groups in the area,  has led in creating a five-year plan designed to transform Magaluf into a chic resort pitched at a higher-spending clientele from all over Europe.


The plan consists of the following 5 goals:

 

  • Continue to upgrade existing hotels and new openings
  • Extend the season to nine months of the year (March to October) through a strategic approach to the destination with the support of airlines, hotels, complimentary facilities, sports associations, shopkeepers, cultural infrastructure and institutions
  • Make Magaluf the ideal destination for  couples and family summer holidays with a wide range of competitive, quality facilities and experiences for children, teenagers and adults, and enhance the availability of sport facilities and events and optimise their marketing to contribute to the sustainability of the resort and reduction in seasonality
  • Modernise and improve complimentary facilities, i.e. food and beverage, retail, leisure, culture, etc. even by creating a great cultural events, to encourage guests to stay in Magaluf in the evenings and also to attract tourists and residents from other parts of Mallorca to Magaluf
  • Position Magaluf as a benchmark for the regeneration of a mature destination, an example of innovation and sustainability, changing the reputation of a destination


Finally, from Meliá Hotels International, jointly with many other Companies and Institutions in the area,  we aim to complete the challenge of transforming Magaluf’s reputation and reality so that it can meet the expectations of modern travelers-  a goal with which we  have been firmly committed since 2011’s -  and, as the Vice President of Meliá Hotels International for the Mediterranean Region, it is a privilege to be able to lead this amazing and challenging process.

 

 

By Carlos Martins
Vice President Mediterranean Region at Meliá Hotels International
Member of The Rooms Collection Magazine Advisory Board