The price of business premises being transferred to new owners in the Balearic Islands has fallen by 60% in the last six months due to lack of demand.
More properties are available but there are fewer people who want to start up new ventures.
Chechu Osinalde, Manager of the Gesmorent Real Estate Company which is dedicated to commercial premises, industrial warehouses and offices, says “there's been a lot of movement since the Covid-19 de-escalation process began."
The majority of closures and transfers are in the Catering and Retail Sectors and the current proliferation of ‘se traspasa’ signs in the centre of Palma hasn’t been seen since the 2008 economic crisis.
Real Estate companies are adding more and more empty premises to their portfolios every day and experts are predicting that the current financial crisis will get even worse in the Balearic Islands in the coming months.
A PIMEM Restoration Association survey released on Wednesday stated that 18% of establishments in the Sector will go bust in the next few months.
Small businesses are not faring any better; the Balearic Islands have led the decline in year-on-year sales for the entire country for four months in a row.
According to National Institute of Statistics data published in July, the volume of business fell by 14.8% in the Balearic Islands year-on-year, which is nearly four times higher than the national average of 3.7%. The decline in sales in the Commerce Sector in the last few months was even worse than during the last recession.
Hundreds of companies are closing their doors for good, but Chechu Osinalde from Gesmorent says savvy investors are ready and waiting to snap up the best business premises and most of them are local people.
Other business owners are taking advantage of the opportunity to relocate to some of the most desirable locations in the city.