The Federation of Small and Medium-Sized Enterprises of Mallorca (Pimem), the Union of Associations of Self-Employed Workers and Entrepreneurs (Uatae) and the Association of Small and Medium-Sized Businesses of Mallorca (Pimeco) have called for measures to prevent the ‘collapse’ of traditional commerce on the island due to rising rental prices.
In a statement released by Pimem, the three organisations warned that, according to data published last March by the Tax Agency, the Balearic Islands are the region where the highest prices are paid for commercial premises. This rises to 21.4 euros per square metre, followed by Madrid (17.68 euros/m2) and Catalonia (13.23 euros/m2). In the case of offices, Madrid tops the ranking with 17.71 euros/m², ahead of Catalonia (16.80/m²) and the Balearic Islands (14.87/m²).
According to data cited by Pimem, the median rent for commercial premises, offices and industrial warehouses has risen by 18.6% between 2020 and 2023 and by more than 20% in five years at the national level. According to Uatae, in Spain as a whole, self-employed workers spend between 25% and 50% of their net income on paying rent for their premises, a burden that has become ‘an unbearable weight for the viability of thousands of businesses’.
‘The consequences of this seemingly unstoppable situation are reflected in thousands of closed shutters: in the last year, more than 10,000 businesses have closed in Spain, which is equivalent to an average of 38 per day,’ said the president of UATAE in the Balearics, Jeroni Valcaneras. Uatae has insisted that this situation ‘is not temporary, but structural’.
‘We have been warning for years that rising rents, especially in stressed urban areas, have become one of the main threats to self-employment and local commerce,’ said its president. Uatae has called for ‘urgent measures to prevent the collapse of small businesses’, such as regulation of commercial rents in areas under pressure, the extension of direct rent subsidies, limits on the liberalisation of opening hours for large stores and a specific digital strategy for local businesses.
For Valcaneras, it is a question of ‘not allowing property speculation to destroy the self-employed’. ‘Public policies must put small businesses at the centre, with regulation, support and tools to prevent them from dying out,’ he claimed. The president of Pimeco, Carolina Domingo, believes that what small businesses need is ‘stability’ and not ‘rigid market intervention’.
‘We are committed to contracts of at least five years that provide security for both parties. When it comes to renewals or terminations, those who are already there must be taken into account,’ she stressed. The association also considered it ‘essential’ that landlords should not be able to include ‘abusive clauses’ or ‘preferential renewal’ clauses for those who comply, giving opportunities to those who are already there and, if this is not possible, prioritising iconic businesses that carry out the same activity.
Domingo also highlighted the need to create tax incentives for ‘responsible owners’ who are committed to local commerce. The Pimem restaurant association, for its part, argued that beyond high rents, the danger to the viability of the business ‘comes when it is time to renew the lease’. ‘The increases applied by certain landlords go beyond the CPI; we are talking about increases that make it impossible for restaurants to continue,’ said the association’s president, César Amable.
According to Amable, ‘the concern among restaurateurs has reached the point where they are looking for new premises two or three years before the end of their contract for fear, and in many cases with certainty, that the increase will be unaffordable’.