Spain’s Government Extends Concessions for Coastal Homes by 75 Years

13/10/2014 – Expansion

The Coastal Act approved on Friday brings about many important amendments for the housing development field. The most significant one extends concessions for over 35.000 property developer companies found within the public domain zone.

The 1988 Law issued concessions for 30 years, a term which now will be prolonged by 75 years more (in case of dwellings) in exchange for an annual fee. There are some 40.000 buildings within the maritime-terrestrial public domain, out of which 24.000 are houses.

Besides, there are 100 hotels – plus 900 in the protective constraints area – whose concessions have been renewed for 50 years more. The thousand of establishments may now prolong their business activity, carry our refurbishments and gain in service quality, provided that they do not enlarge their size and improve their environmental efficiency, above all in terms of possible pollution generation.

The same renewal term will be granted to 1.700 industrial units. Moreover, some 3.000 beach bars (chiringuitos in Spanish) which give around 50.000 direct jobs can now obtain additional 30 years of concession validity. Not for free, though, as they must meet the followig requirements: on the natural beaches, they neither can have an area greater than 20 square meters nor more than 50 square meters of the terrace space and they must be separated from each other by a minimum 300 meter distance so that the occupancy does not exceed 10%.

Nº Beneficiaries: 500.000

If it comes to the urban beaches, the requirements are much milder. Moreover, permitted are general interest events involving positive impact on tourism.

At the moment, merely 4.600 out of the total of 40.000 buildings found within the public domain areas have got concessions (600 are dwellings). The regulation update will allow 35.000 companies and 500.000 people to benefit from the amendment as the Government aims at full legalization of 90% of the units, no matter what their situation is.

The Coastal Act helps to dodge demolition of coastal properties as the 30-year term consessions expire in 2018. Until now sentenced to becoming a heap of debris, 13.000 dwellings will not only remain standing but also can be sold, inherited, mortgaged, etc.

Tax & Collection

However, the properties will not be treated as regular residential units for the reason that they occupy the public land. Their owners will be obliged to pay a 6% tax on their cadastre value. Given an average of €60.000 per house, the contribution may empty the taxpayers’ pockets by €3.600 annually or €300 monthly.

The Ministry led by Isabel Garcia Tejerina believes that the amendment will facilitate creation of around 150.000 direct jobs and will generate over €2 billion cash flows on the coasts.

 

Original article: Expansión (by Juanma Lamet)

Translation: AURA REE

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