Mallorca needs to increase prices more, says leading hotelier

Antonio Catalán is one of Spain’s leading hoteliers. His name is less familiar in Mallorca than the names of those who head up the likes of the island’s ‘big four’ of Barceló, Iberostar, Meliá and Riu, as he is not Mallorcan and his hotel interests on the island have not been great by comparison. However, the hotel chains that he has founded – NH Hoteles and more recently AC Hotels-AC by Marriott – are major companies, while his understanding of the Mallorca market includes having owned a house on the island for the past fifteen years.

On Friday, he presented the revamped Hacienda Son Antem in Llucmajor, a five-star luxury hotel complex in which eleven million euros have been invested, which has 151 rooms and will operate all year. It will be marketed under Marriott’s Autograph Collection Hotels brand.

At the presentation, he was asked for his opinion on this year’s tourism season in Mallorca and the Balearics. “With a record number of tourists, there is a distorted economy because of global billing at average prices. There has to be a change to the customer profile. Mallorca has plenty of customers and needs to raise prices more. All this has to be complemented with an investment strategy to improve the accommodation offer and be even more competitive.”

It is time, he said, “to take a qualitative leap and be brave”. “I believe as a businessman that if clients cannot pay the price that I have set for a product, they should not come. It is necessary to take another turn in terms of tourist evolution and in the case of the Balearic Islands, one must know how to value what one has and be much more selective. At the same time, if there are businesspeople who cannot pay even the minimum wage, then they should cease being businesspeople. Everything is relative, both above and below.

“The Balearics have all the conditions in their favour to add value to the islands’ tourism industry. You have to be more selective. I’ll give an example. Four years ago, because of Brexit, British tourists saw the pound devalued by 20%. But despite everything, they came to Spain, paying 22% more for their holidays. It is a question of pressure (in reference to tourist overcrowding) and of acting according to professional and commercial criteria. It can be done because in the case of Mallorca, we have everything in our favour to be able to improve all that relates to marketing and price increases.

“Low-cost prices imply having low-cost tourists. It’s that simple. It is time to look forward with a courageous business vision, because the European markets are going to respond, despite the uncertainty that prevails at the moment.”

As to the 2023 season, Sr. Catalán observed that “it is too early to be able to make any kind of forecast”. “The geopolitical and economic situations are what rule. It is true that there are countries which will enter recession, such as Germany, but European tourists will continue to come because they are willing to pay anything to go on holiday. The Balearics must play with the correlation between occupancy and average price. Occupancy and the average price per room have to be based on fewer clients, and this improves levels of profitability.”

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