Hotels across Spain are reopening as the vital summer season gets underway, fueled by an easing of domestic and international travel restrictions and increasing vaccination levels.

Hotel brands active in Spain are moving ahead with new openings at the same time there is growing investor interest in the sector.

“There’s a definite feeling of relief, and it’s evident in what’s happening with major chains reopening resorts on the coasts and the islands," said Ivar Yuste, partner at Madrid-based consultancy PHG Hotels & Resorts. "Urban properties in the major cities are also starting to open up.

“Even secondary markets of smaller cities are doing well with high numbers of Spanish guests, as for a long time they’ve had no place else to go because the internal regional borders were closed until [early May].”

In further good news for the industry, Spanish Prime Minister Pedro Sánchez announced last week that travelers from anywhere in the world who had been fully vaccinated by the vaccines recognized by the World Health Organization or the European Medicines Agency could enter the country without a negative test or quarantine starting June 7.

Mikel Zaldua, general manager of the 58-room Hotel Lasala Plaza — located in the Atlantic Ocean resort city of San Sebastian — said reservations have skyrocketed after the end of the domestic travel ban.

“We’ve seen bookings double since then, and we’re getting guests from all over Spain, whereas before they only came from the surrounding Basque region," he said. "We’re also seeing a great deal of interest from the French and are waiting with open arms for the British and other Europeans this summer when travel is again permitted."

COVID-19 dealt a severe blow to Spain’s tourism sector, which had accounted for 12% of the nation’s gross domestic product and employment up until the beginning of the pandemic. According to the National Statistics Institute, visitor numbers between April 2020 and March 2021 plunged by 88% compared to the same period a year earlier when Spain had been enjoying a run of several years of record tourism levels. At the same time, overnight stays in 2020 were down a record 73% from 2019.

As a second and then a third wave of COVID-19 hit, many of Spain’s main demand markets, such as the United Kingdom and Germany, placed restrictions on travel to Spain, while Madrid limited foreign visitors from Europe and further afield to only those on essential visits.

Spanish authorities then closed off most domestic travel by shutting regional borders. The country’s three top hotel chains — Meliá Hotels International, NH Hotel Group and Barceló Hotel Group — lost a total of 934 million euros ($1.1 billion) in 2020.

Restrictions started to ease earlier this year, and there is growing momentum to lift remaining controls. Earlier this month, Spanish authorities said they would soon allow British visitors to enter without a polymerase chain reaction (PCR) test.

Britain is Spain’s main demand market, and after the pandemic struck, the number of British visitors fell from 18 million in 2019 to only approximately 3 million in 2020.

Spain still remains on the United Kingdom’s list of do-not-travel countries, but Spanish authorities said they expect that to be reversed soon as COVID-19 cases drop and vaccinations in both countries increase.

The Spanish government has pledged that 70% of the population will be vaccinated by the end of the summer, sparking additional hope among hotel executives.

Gabriel Escarrer, CEO of Meliá Hotels International, said the worst of the pandemic is behind Spain, thanks to the vaccination campaign and the establishment of safe travel corridors.

“These factors signal a rebound in summer travel, and as we’ve seen in our other markets like China and the Caribbean, there is certainly pent-up demand,” he said. “In Spain alone, there has been a surge of guest reservations from Germany and Britain."

While Meliá focuses on reopenings of existing hotels for the summer, other chains are debuting new properties.

Barceló is opening a total of five hotels in Alicante, Cádiz and Malaga provinces, and Room Mate Hotels has two scheduled openings in Spain this year, founder and CEO Kike Sarasola said.

The 228-room Room Mate Angel — the company's first property in Ibiza — will open in June. Another hotel, the Room Mate Olivia, will open in Mallorca later this summer, he said.

“We believe we’re going to have a positive year, [and] hoteliers will once again be making guests happy as they begin to travel to meet up with friends and family,” Sarasola said. “It’s clear there is a resurgence in business and not just in Spain. Our property in New York City has seen a recent tripling of reservations in a virtual avalanche.

“And what with vaccine rates going up in Britain and Spain and more people being allowed to travel, I think the second half of this year will be very good."

Global hotel companies active in Spain are also bullish about recovery, said Richard Brekelmans, area vice president for Southern Europe at Marriott International.

The 83-room AC Hotel Tenerife by Marriott opened in the Canary Islands in March. Two Tribute Portfolio properties in Ibiza and Seville are in the pipeline, as is the Hotel Querencia de Sevilla under Marriott's Autograph Collection soft brand.

“These four new openings grow our Spain footprint to 102 hotels,” Brekelmans said. “The focus for ourselves and other international hotel groups as our businesses look forward to recovery after the impact of COVID-19 is ensuring that Spain continues attracting visitors from Europe and around the world."

Spanish hoteliers are also happy over the government’s plans to restart a subsidized vacation scheme for retirees in the fall, which was suspended because of the virus.

Industry analysts also project that European summer vacationers are expected to switch to Spain, avoiding rival destinations like Tunisia, Turkey and Egypt that are still struggling to contain the pandemic.

Investors are also taking note of the improving situation.

“Last year was a disaster, and the first quarter of this year was very quiet for our consultancy,” Yuste said. “But since March, investors are more active, and development is becoming very busy in Spain and Portugal.”

Private equity investors are looking at distressed resorts in places such as the Canary Islands, he said. However, there are not many properties available because owners are adopting a wait-and-see attitude.

Yuste said some of his clients have slowed down development while they, too, waited to see what would happen.

“But now they predict that a promising summer is on its way, and they’re speeding things up, hoping it’s all going to get better over the next year to 18 months,” he said.