Millions for a five-star hotel, but who will pay for the mistakes of the past?

The Spanish government is providing more than €6 million in public funding for the future, five-star, Fuerte hotel in the coastal town of La Herradura.

The project on the Costa Tropical, involving a total investment of €32.5 million, is expected to create ninety jobs. Good news for the developer, good news for the local council and, on paper at least, good news for the local economy.

But the timing raises serious questions.

The municipality of Almuñécar recently announced that it is facing a painful financial setback of almost €20 million. The bill stems from the long-running ‘Torre Galera’ property case. A developer paid millions of euros for building rights that ultimately could not be exercised. The money was not repaid in time and, as interest accumulated, the debt has now almost doubled.

At the same time, the current municipal administration, led by Mayor Juanjo Ruiz Joya, is presenting the arrival of the five-star hotel in La Herradura as proof of progress and economic ambition. Yet this hotel project, too, has been under discussion for more than twenty years.

Transparency

The residents of Almuñécar and La Herradura have a right to know exactly what they will receive in return for the millions of euros in public money being invested in this hotel.

What will the final design look like? What infrastructure will the municipality have to build or finance? How many additional houses or apartments will be permitted in the surrounding area? Who stands to benefit financially? And exactly how will the subsidy of more than €6 million be spent?

The economic case also deserves closer scrutiny. What occupancy rate is the business plan based on? Will the hotel remain open throughout the year, or only during the peak tourist season? What happens if revenues fall short of expectations? And who will ultimately carry the financial risk?

For ordinary business owners in Almuñécar and La Herradura, the contrast could hardly be greater. Restaurant owners, shopkeepers, self-employed workers and small hoteliers must continue paying their staff, rent, taxes and energy bills throughout the quiet winter months. No government is standing by to offer them a multimillion-euro subsidy.

Competition

It is therefore entirely reasonable to ask why one large hotel project should qualify for such generous public support. Major investments can create jobs and prosperity, but they can also distort competition.

Meanwhile, the municipal government has warned that, in addition to the Torre Galera case, further financial setbacks inherited from the past may yet emerge. Responsibility is being placed largely on former local officials and former mayor Juan Carlos Benavides.

But anyone who invokes the mistakes of the past has an even greater duty to be transparent today.

That is especially true because Almuñécar has experienced other painful property scandals. In Cármenes del Mar, residents saw their homes crack, become uninhabitable or even collapse. They became victims of property development, administrative failure and inadequate supervision. For them, planning and development policy is not an abstract political debate. It is a tragedy that has shaped their daily lives for years.

No Second Torremolinos

Almuñécar and La Herradura undeniably have momentum on their side. The area is attractive, tourism is growing and investors are showing interest. But growth does not automatically mean progress.

Without clear limits, La Herradura risks losing its distinctive character, while Almuñécar could repeat the mistakes made by other overdeveloped coastal resorts.

Nobody is waiting for a second Torremolinos. Nor should becoming a copy of Nerja be an ambition. Almuñécar and La Herradura should protect precisely what makes them different: their human scale and authentic character.

A municipal government facing a bill of almost €20 million for mistakes made in the past cannot afford to embark on new and opaque property adventures.

Trust is not created by cutting ribbons or polishing one’s public image by growing a beard and losing weight. Trust is created by explaining—before construction begins—who benefits, who pays and who carries the risk.

Sjuul Paradijs
La Herradura
Former Editor-in-Chief of De Telegraaf, Amsterdam

(Reader’s Letter: Herradura, Costa Tropical, Granada, Andalucia)

Keywords: 5-Star Hotel, Responsibilities, Transparency, Government Grant, Tourism, Past Mistakes, Why The Grant

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