After fifteen months of high uncertainty and hardly any trade in the property market due to the pandemic, it looks like things are very slowly moving again. This is certain about the rental market in Gibraltar which seems to be doing considerably better than a short while ago. Across the border, in Spain and Portugal, things seem to be moving as well. This is somehow normal after nearly eighteen months of total inactivity in the markets.
The pandemic has no doubt destroyed the world economies to a large extent and the road to recovery will be harsh and difficult. The Brexit issue has not helped the markets either, but now that the UK is no longer an EU member and the outcome of all these difficult economic times remains uncertain, it looks like some deals will happen.
There is no question that the British, along with other Northern Europeans, have been good traditional clients for southern Europe and have often provided a very steady source of deals and income for both rentals and sales in Gibraltar, Portugal and Spain. Whoever has the necessary means will most likely make a move as soon as this is allowed and will either rent of purchase in the southern Mediterranean.
So far, the results do not look that promising.
I have spoken to quite a few different businessmen who are all looking forward to some growth this 2021. Property developers are getting ready, restaurateurs are trying their best to rebuild their clientele, service industries are on the way to adapting to the new reality. This is all good news and most fascinating but it will be very hard on some and impossible for others.
I had luncheon with an old business client who owns a chain of successful restaurants on the beach. They are not doing too badly, but so far, the results do not look that promising. Their capacity is not as good as in pre-pandemic times. There are obvious reasons for this: no British tourists around, and few Central and Northern Europeans. So it looks like it is mostly Spaniards form Central and Northern Spain along with the French. Yes, the French seem to have rediscovered this part of the world.
Two weeks ago, having cocktails at Hotel de Inglaterra in Sevilla, we were surrounded by well-to-do French clients. France is sort of closed down and there is little to be done. So off they go to Spain and Portugal. Not only are they an excellent source of income, but most clients are high-end and hefty spenders. To throw big parties or celebrate a large wedding in Spain for the French was totally unheard of some years ago. Now they seem to be very much in vogue. The glamorous Marbella Club Hotel is packed with rich French clients mostly from Paris. This is a clear sign that you cannot stop people from taking their leisure breaks in the sun no matter what. If they have the means, they just go for it.
This summer may be an important one for the southern Mediterranean with regard to tourist trade. Morocco is pretty much closed down. Other North African countries are unsafe or closed down because of Covid. This may be beneficial for other tourist destinations.
Gibraltar is on the green list with the UK so trade and tourism is guaranteed for the time being, hopefully for a long spell. Spain, Portugal and other European countries are on the amber list and hence not really feasible or practical to travel to. Hopefully with the vaccine program this will change for the better, but other Europeans will travel south, along with Spaniards and some Portuguese. When economies go wrong, new businesses are created. New clients come along. It is not a matter of days but it does work like this. The young lads of 18 to 25 went berserk with not being able to party. This has affected the hospitality industry, certainly, and the discotheques. But they will open again at some point and they will get packed and flourish again.
When economies go wrong, new businesses are created.
The IMF predicts the economies to grow about 6% in 2021 and about 4.4% in 2022. These are predictions so the figures are not exact but quite close to reality. Getting ready is a positive way forward. A friend who owns a large wedding venue close to Cadiz is talking about giving his centenary Cortijo a good revamp and making it close to perfect for next year. This is perhaps a good time to do positive things to your business and prepare for the close future. Look at Israel; they have been doing a great deal of work to prepare for their future tourist trade.
In this very modern world where time seems to fly at supersonic speeds it is wise to use a slowdown in trade and economy to be constructive and prepare your business for the future. Very challenging times lay ahead so make sure you are up to the mark.