The Palma and Cala Major hoteliers association is saying that boutique hotels in the city are having to reduce their prices for the coming months because of a progressive decrease in occupancy levels. Lowering prices will mark a reverse in the trend for prices to go up over the past five years. Javier Vich, the association's president, explains that there is a great deal of competition and that is logical for prices to be reduced. This competition is not solely from other destinations, it is between the hotels themselves.The increased number of beds in boutique hotels is not being met with corresponding demand.
There are at present 25 boutique hotels and four more are due to open next year. But the implication is that the boom that has been experienced in recent years is coming to an end because of faltering demand. Likewise, tourists seem to be less inclined to pay the sort of prices that some hotels charge - anything up to 500 euros per night.
Vich says that the pricing decision will obviously be one for each hotel to make, based on anticipated occupancy, but it would seem that it is not just the forecasted occupancy that is making hotel owners rethink. Occupancy levels over the past year and the prices that have been charged are bringing about a turning point.
