Gesmorent is a Palma-based agency that specialises in the sale, rent and traspaso of commercial properties. Its manager, Chechu Osinalde, says that rents, especially those in the centre of Palma, have come down by between ten and fifteen per cent because of the crisis.
This decrease is evident for both new and existing contracts. In the case of the latter, Osinalde explains that landlords and tenants have arrived at agreements to reduce rental prices. Addenda to contracts for cuts of up to 15% will apply in some cases for up to two years.
A renegotiation of rents became imperative as soon as the state of alarm was declared. The duration of the state of alarm wasn't known in mid-March, but it could have been foreseen that it would last as long as it has, as could have been the impact on businesses. Even once the state of alarm is lifted, prospects are not good because of a fall in internal consumer demand and the loss of tourists.
Despite the agreements for rent reductions, there are businesspeople who want or need to put establishments up for traspaso. Osinalde detects a growing number of 'se traspasa' signs and expects this number to increase over the coming weeks.