Madrid: the Eldorado for tourists and investors ?

5 min reading time

Published on 01/03/21 - Updated on 17/03/22

madrid tourisme investissement hôtel

The Spanish capital, Madrid, has become a paradise for French tourists looking for more freedom in this difficult epidemic context but also a privileged place for real estate and hotel investors because of its rich heritage and exponential attendance.

Spain is the second most visited country in the world, after France, with more than 80 million tourists coming every year to discover its culture, gastronomy and landscapes. Among the country's flagship destinations, there is the city of Madrid, which today attracts both tourists and investors with its undeniable appeal and dynamism.

The Spanish cultural destination par excellence

On a European level, Madrid ranks 15th among the most visited cities with no less than 7.6 million international tourists in 2019. Visitors are mainly attracted by the city's cultural assets, which are at the heart of Madrid's tourist offer. The typical tourist route through the capital is made up of emblematic monuments and sites such as the Plaza Mayor, the Royal Palace, the Teatro Real (Opera Theatre), the Almudena Cathedral and the Puerta del Sol. The museum offer considerably enriches Madrid's heritage with the presence of two world-famous museums, both of which had more than 7 million admissions in 2019: the Prado Museum and the Reina Sofía Museum.

Despite the fact that "sol y playa" is the predominant tourist offer in Spain, Madrid has managed to do well and has seen a 7% increase in tourist numbers in 2019, while the coasts are showing the opposite trend. The economic spin-offs resulting from tourist activity have thus seen an increase of around 6.5% in the same year. In addition, the Community of Madrid has the highest tourist spending in the country, with average daily spending of 269 euros compared with the national average of 154 euros.

A city valued by the French in search of freedom

French tourists have invaded the streets of the royal city in recent weeks to escape the restrictive health measures introduced in France since the beginning of the pandemic. After having experienced one of the strictest confinements in Europe in 2020, certain regions of Spain, such as the Community of Madrid, have recently decided to ease their health restrictions in order to boost tourism. Thus, cultural places such as museums, theatres and cinemas, but also restaurants and bars have reopened their doors and are once again welcoming the public in compliance with the barrier gestures. It is even possible to go dancing in nightclubs from 5 to 9 p.m., with a curfew in place from 10 p.m. to 6 a.m.

All these freedoms encourage the French to cross the border in the hope of regaining a semblance of normal life. Last December, no less than 164,000 French tourists visited the Spanish capital. The number of French visitors thus largely exceeded the number of tourists from Germany or Great Britain, in fact 1 tourist out of 4 was of French origin. The majority of tourists travelled by plane and therefore had to submit a negative PCR test dating back less than 72 hours at the entry of the territory, but this condition does not apply to travellers travelling by car, which currently concerns 60% of French tourists.

A large proportion of these French tourists are young people, often students who are looking for a more pleasant setting to follow their online classes. But this influx of young tourists is beginning to worry the authorities because of the many illegal parties organised in rented accommodation that do not respect any health rules such as wearing masks. Some even use the term "festive tourism network".

A city in perpetual movement

The city is in the process of becoming a flagship destination for luxury tourism, indeed a dozen hotel projects are announced for the coming years, some of which are already off the ground, the majority of which would be top-of-the-range and luxury establishments. Among these future establishments, we can mention the Hyatt Centric, the Marriott W or even the Hotel Pestana CR7 belonging to the football player Cristiano Ronaldo. There is also the Four Seasons Hotel Madrid, centrally located near the famous Puerta del Sol and set in 7 historic buildings dating back to the 19th century. It consists of 200 rooms and suites as well as 22 private residences and also features a gourmet restaurant and a spa, which will be the largest spa in the capital. The construction of this hotel crowns the Centro Canalejas commercial project developed jointly by Mohari Hospitality and the Spanish construction company OHL, which has the final objective of opening a large 16,000 m² centre with luxury shops and restaurants in the heart of Madrid.

The luxury hotel market is not the only one to take the Spanish capital by storm, the super-economic sector has also decided to flood the streets of Madrid like the Easy Group, which owns the EasyHotel subsidiary. Indeed, the company has acquired a freehold hotel site in the city in order to build a new hotel with a capacity of 230 rooms over 2021-2022 to develop its network in major European cities. The group's CEO, Scott Christie, justifies the choice of the city of Madrid as "an emblematic destination with many attractions for tourists and business travellers".

Extensive renovation projects are also taking place in the city, such as the Hotel Ritz Madrid, which will reopen its doors at the beginning of 2021 as the Mandarin Oriental Ritz Madrid after almost 3 years of closure. The hotel's 153 rooms and 53 suites have been completely redesigned by French designers Gilles and Boissier and as novelty, the hotel has added new leisure and wellness facilities such as a heated indoor swimming pool and a beauty salon. The Accor group has also launched major renovation works for its Novotel Madrid Puente de la Paz hotel, transforming it into a new and innovative hotel concept. This project is the result of the combination of two of its hotel brands, Novotel and Ibis Styles, with a gastronomic concept called Unusual. The hotel is thus composed of 156 Novotel rooms and 96 Ibis Styles rooms spread over several floors, sharing common areas such as the breakfast room, the swimming pool and the gym. The hotel also features 8 meeting rooms of more than 400m² and a large garden area that can accommodate large outdoor events.

The construction of a new business district will also see the light of day, the Madrid Nuevo Norte, a project that has been in the pipeline for many years and which began to come to life at the end of 2019. This urban renewal project is currently touted as the largest in Europe with a total surface area of 3.3 million m², of which 1.6 million m² is dedicated to offices and shops. The site will also house 10,500 housing units, 500,000 m² of green space, the country's largest TGV station and a new metro station. This ambitious project is scheduled for completion in 2044. Once completed, it is expected to create 200,000 new jobs, with economic spin-offs amounting to €16 billion.

Madrid has established itself as a major European and even international destination thanks to its rich cultural heritage, lively nightlife and typical gastronomy. The capital is just as attractive for tourists as it is for investors, especially hotel owners, who see the full potential of such a dynamic and trendy city. And this is of great benefit to Madrid, for whom tourism is one of the major sectors of activity. Thus, with the aim of boosting tourist numbers, which are picking up again, the municipality decided on Thursday 18th February to lighten the sanitary restrictions even more, pushing back the curfew and the closure of restaurants at 11 pm.

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