Canary Islands’ hotel owner and operator Lopesan Hotels & Resorts has received a €300 million ($350 million) out-of-court settlement from the government of the Canary Islands that ends a 20-year-plus legal dispute over zoning regulations and a hotel-construction moratorium.
Government officials will pay out €485 million in total compensation to a group of hotel developers, almost 62% of which will be paid to Lopesan, Spanish news website Hosteltur reports. Initially, the group of hotel developers including Lopesan requested an €843 million payout.
Lopesan owns and/or operates 24 hotels, with 13 in the Canary Islands, four in the Dominican Republic, four in Germany and three in Austria.
The payout revolves around zoning and construction regulations passed in 2001 on new hotels and resorts and subsequent Law 19/2003 “General planning guidelines and tourism planning guidelines for the Canary Islands.”
Hosteltur said the decision “paves the way for the reactivation of more than 20 [hotel] projects that have been stalled for years” and that for land parcels specified in the legal action “for five years [their] reclassification as rural land will not be automatically applied, which will allow the urban development of the plots to be analyzed again in accordance with the current planning.”
Ivar Yuste, partner in the Madrid office of business advisory PHG Hotels & Resorts, said in an interview it is quite alarming that the Canary Islands administration has managed the issue so poorly and that for 25 years it had been impossible to develop hotels on plots.
The claims cover plots that had initially tourist use but then could not be developed as such once the 2001 and 2003 new planning rules took effect, Yuste said.
“As a result of this policy change, Lopesan filed 31 of the 45 administrative disputes and is getting €300 million of the total €485 million agreed. … What happens now is these plots will start all over again the use-classification process. This reopens the development pipeline in this area of the south of Gran Canaria [and in] Lanzarote and Fuerteventura,” he said.
He added the legal issue was the result of “political mismanagement interfering with private initiatives, and costing money to taxpayers. The [compensation] numbers are so large that repayment will be over several years.”
Other hotel developers in the legal action included Grupo Satocan — which received €10.2 million in the settlement — Seaside and Dream Place, Yuste said. The rest of the owners in the action are not hotel companies, he added.
In July, the Gran Canaria regional hotel market's occupancy rose 4.7% year over year to 83.7%, according to CoStar hospitality data. Average daily rate jumped 11.7% to €182.85 and revenue per available room rose 17% to €153.12 ($178.63).
In 2024, Lopesan partnered with Stoneweg Hospitality to acquire the 241-room Hotel Miguel Ángel in Madrid for €210 million, or approximately €871,000 per key.
