Andalusia passes new decree-law to encourage renovation and modernization of its tourist accommodation establishments

Spain - 

Spain Tourism and Hotels Commentary

One of the measures adopted by the Andalusian government to contend with the effects wrought by the health crisis on the economy is the recent Decree-Law 14/2021, of July 6, 2021 (July 13, 2021 edition of the Junta de Andalucía Official Gazette). The decree´s name has all the makings of a statement of intent: “providing incentive measures for the renovation and modernization of tourist accommodation establishments”.

The decree-law is intended to serve as a stimulus to a strategic sector. Not without good reason seeing as how the tourism industry accounted for 13% of the gross regional domestic product before the COVID-19 crisis burst onto the scene, and is now one of the most vulnerable and damaged due to the effects of the pandemic.

Three basic goals are set: (i) to renew and modernize the supply of tourist accommodation in Andalusia so as to enhance their competitiveness, (ii) enable establishments to be adapted to higher categories and (iii) support and provide incentives to a crucial industry for the autonomous community’s economy. It seeks to achieve these goals by laying the foundations for encouraging new investments in businesses, which will contribute to giving an economic boost to an industry that was hit particularly hard by the halting of activity due to the health crisis.

In this context, the decree-law allows to be relaxed, within specified limits, a number of zoning and planning parameters for reform and modernization work on establishments, which has to start over the next three years and be performed to achieve the described aims. The main characteristics of the new decree are as follows:

1. Subject-matter and scope of application

The extraordinary regime allowed in the decree-law may be elected for the following types of work: extensions or reforms to tourist accommodation establishments that are legally built and entered on the Tourism Register for Andalusia and located on urban land, cover the whole of one or more buildings and have as their purpose (i) to obtain a better type or category for the establishment, (ii) to achieve the “Grand Luxury” rating used for five star hotels and apartment hotels, or (iii) to lock in new segments of the market or improve their supplementary services so as to contribute to reducing the seasonal nature of their business.

2. Zoning and planning parameters and building work

The decree-law is a special piece of legislation adopted in response to a specific need in a given economic climate, it allows exceptions to the rules that ordinarily apply to reform and renovation projects for buildings under the zoning and planning legislation. From this angle, the most important element of the decree-law becomes the room for relaxation of the gross floor area ratio, coverage and height parameters contained in the zoning and planning regulations.

As a general rule, the new legislation allows an extension or reform project to apply gross floor area ratios and coverage parameters that are up to 15% higher than those contained in the zoning and planning rules or those existing on the plot, if they are higher. The same parameters may be up to 20% higher if the work entails raising the type or category that will be allocated to the establishment, as well as if it will enables the establishment to achieve a ‘Grand Luxury’ rating.

The decree-law also states that, as part of the reform or extension project, the maximum height allowed by the zoning and planning regulations, or the existing maximum height, if greater, may be increased to install staircases, elevators, installations or other auxiliary construction elements. That greater height is also allowed to install supplementary services (i.e., not accommodation services) on the roof of the building, such as a restaurant, gym, spa, solarium or pool.

Among the construction work that the plans for the reform or extension project may contain, the decree-law states that existing spaces may be rearranged, underground spaces may be utilized for habitable functions other than accommodation and redistributing the authorized number of bed places. The project plans may even increase the number of bed places and accommodation units by up to 10%, if the minimum measurements laid down in the tourism legislation are met.

Any buildings that have been reformed or extended under the decree-law will legally be brought under the local zoning and planning regulations, and therefore have fully conforming building status under those regulations. Those buildings will also be required to be used for tourism purposes, and this requirement must be registered at the Property Registry.

3. Nonconforming buildings

A special mention is needed of how the measures in the decree-law apply to “nonconforming buildings”, meaning legally built establishments with respect to which, following their construction, a zoning and planning innovation was approved which altered the zoning and planning parameters for the plot on which they were built.

As expressed in the preamble, it would be hard to achieve the decree-law’s goals if it failed to include in its scope establishments that were built in compliance with all the legal requirements and, as a result of an amendment to planning and zoning regulations, came to have “nonconforming” status. A considerable number of the region’s hotel establishments are in this position, in some cases because they opened a long time ago. Being in this position considerably restricts the option of carrying out reform and extension work on these buildings and therefore curtails their ability to achieve the goals of modernizing, reclassifying and adapting their facilities. Accordingly the new decree-law contains specific provisions designed to temporarily overcome the obstacles attached to having nonconforming status, and enabling the renovation and modernization of tourist establishments subject to this regime, by applying the described relaxed zoning and planning parameters to them.

4. Procedure and time frame

Any reform or modernization work performed under this decree-law will require, in every case, a local authority building permit, as well as a report by the local government department for tourism to ensure that the project plans seek to achieve one or more of its aims.

Additionally, any more major building work involving raising the permitted development rights by more than 10% with respect to parameters allowed in the planning and zoning regulations or to the existing characteristics of the plot will require approval of an amendment to the urban zoning and planning instrument containing the detailed planning provisions applicable to the property.

To elect to apply the provisions in the decree-law, a building permit application must be filed, or an application for commencement of a proceeding for a zoning and planning innovation if this proceeding is required, within three years following the entry into force of the decree-law, namely by July 13, 2024.

The intention behind the decree-law is to contribute to the dawning of a new era full of expectations for the tourism industry in the autonomous community, by having a far-reaching kickstart effect on the industry. It may therefore prove to be a valuable tool for attaining a much desired recovery of the economy while also repositioning Andalusia as a highly competitive tourist destination.