Andalusian high court halts demolition of Benalmádena hotel

The court in Malaga granted a precautionary stay of execution, pausing the 15 September demolition order backed by a 2021 Supreme Court ruling. Interested parties have until 23 September to submit formal arguments.

The three-star hotel - currently operating as Vive Costa Azul - comprises 61 apartments, 46 parking spaces, an outdoor heated pool and communal areas across a mix of ownerships.

The building's origins date back to a 2004 planning licence issued by former mayor Enrique Bolín.

The licence was subsequently challenged by the nearby Torremuelle Homeowners Association and declared illegal in court. The ruling established that municipal planning rules required a minimum four-star rating for the site, and that developers exceeded permitted building densities.

Operating firm Grupo Vega, which acquired most of the property in 2023 despite the standing demolition order, lodged the appeal that secured the stay.

Grupo Vega has presented a baseline plan to Benalmádena Town Hall proposing a "partial legalisation" of the complex.

Under the proposal, the group would demolish 11 apartments - reducing total rooms from 61 to 50 - and trim total floorspace to 2,013 square metres, comfortably below the local density limit of 2,249 square metres.

The developer argued that total demolition would cost local taxpayers over €10m in demolition expenses and municipal compensation claims resulting from the unlawfully issued licence.

"We are offering to cover the partial demolition costs ourselves and waive compensation," Grupo Vega stated, urging the council to act "within reason and according to principles of good administration".

If the local council accepts the compromise, it must notify the court before the 23 September deadline, after which judges will deliver a final decision on the hotel's future.

The licence was granted to the Seville-based company Inversiones Inmobiliarias RB, and the premises were operated by various companies. It is now run by Grupo Vega, a conglomerate of companies based in Málaga which, in 2023, became Grupo Vega Capital Socimi and has since carried out various transactions, eventually becoming, according to the firm, the owner of the majority of the property, despite the fact that the demolition order has been final since 2021.

It was the group that lodged the appeal with the TSJA – against the decision of the Court of First Instance in Málaga – and secured the interim injunction suspending the demolition. The company’s aim is to prevent the demolition from going ahead and to secure a ‘partial legalisation’ of the development, something which Benalmádena Town Council itself attempted to do in 2017 but which was rejected by the High Court at the time. Grupo Vega has drawn up a preliminary proposal which it has submitted to the Council, proposing the demolition of eleven accommodation units, which would reduce the number of rooms in the establishment from 61 to 50 and lower the buildable area by more than 200 square metres below the standard maximum (2,013.84, instead of 2,249 square metres).

The company justifies its proposal by appealing to the public interest, not only in terms of maintaining operations and jobs, but also because of the costs this would entail for the local authority’s coffers, which it estimates at over 10 million euros, comprising the costs of demolition and the compensation that the company and the other owners might claim in relation to concessions arising from an action for which the local council is legally responsible (the illegal licence granted). Furthermore, it points out that this is private property and a site which the General Urban Development Plan (PGOU) designates for a hotel; therefore, demolition would under no circumstances result in the plot being put to public use.

The Vega Group has urged the local council to consider its proposal, which is “accompanied by a commitment to bear the costs of partial demolition and to waive compensation” and has stated that it hopes “the City Council will ultimately act reasonably, in accordance with the principle of good governance and with full respect for the judge’s decision”.

If the City Council accepts the proposal, it must notify the TSJA by the deadline of 23 September, after which the judges will have to rule on the definitive future of Vista del Rey.