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El Terreno is on the up, as foreign buyers take an interest

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El Terreno in Palma is undergoing something of a revitalisation. The property market reflects this; prices are going up.

A case in point is the Hostal Corona. It was put on the market in August last year for 4.3 million euros. Given the interest shown by potential buyers, the price has gone up to five million. Alternatively, it could be rented for 10,000 euros a month.

Katja Schrapel of El Terreno Inmo says that many British and German buyers are showing an interest in tourism-related establishments. “We have been very surprised. It was thought that there wouldn’t be interest because of the pandemic. Some owners have been in contact in order to increase prices. They are aware of what’s going on.”

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The reason for this interest is the process of revitalisation, not least that of Plaza Gomila. Despite Mallorca having suffered over the past year, Schrapel explains that “there aren’t the bargains to be had which clients expect”. “Although there are establishments that are closed, there hasn’t been a lowering of prices in El Terreno.”

The same applies to the residential market. Schrapel gives an example: “We have a property that was on the market for 1.3 million euros. Two weeks ago the price rose to 1.5 million.” There are some parts of El Terreno that are rundown, but the district is nevertheless on the up and is becoming a new focus for Palma.

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Hans Lenz, the director of Engel & Völkers Mallorca’s southwest area, says that they will shortly be promoting two two-storey houses with terrace and parking; both of them for one million euros. These are a short distance from Plaza Gomila.

He observes that El Terreno had been “abandoned to its luck”. Now, however, there is very significant investment. “Within no time we will see a greatly rejuvenated and improved El Terreno.”

There are, as Lenz points out, a number of properties that have been empty for years. There are others which are for nightlife, a sector that has been devastated by the pandemic, while there are also squatters. He believes that there will be conversions which mean that El Terreno distances itself from what it has become in recent years. “The district has suffered a great deal. It is fantastic that there is going to be a new life.”

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