The business takeover / traspaso of commercial properties in Mallorca
In Mallorca, you can acquire a commercial property inexpensively and profit from the deal in the long term. There's a rather strange formula for this. This formula has barely been legally regulated and is called "traspaso." The word "traspaso" means "handover" or "transfer" and is used, for example, when a politician resigns from office or there is a change of government.
In Mallorca, you can identify a business that's being transferred by a sign in the window that reads "SE TRASPASA."
Legal requirements for taking over a business
Spanish law allows you to take over a shop or other type of commercial property. This doesn't just mean taking over the furniture or inventory; the lease continues as normal; only the landlord is permitted to increase the rent by 10% to 20%. This can be particularly advantageous for older leases, as previous leases are significantly more cost-effective, even if the landlord increases the rent by 20%. The operating licenses for commercial properties can also be transferred to the new tenant at the town hall. This means that, for example, as the new manager of a nightclub or bar, you don't need to obtain a new license to serve alcoholic beverages. You also don't need to obtain a license to operate 24/7.
For a valid traspaso, however, you need a notary so that you can effectively conclude the contract. In the contract, you, as the new shop owner, commit to operating the same business for at least one year. This means that if you take over a bar, the business will remain a bar for at least one year.
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The former operator must also commit to something according to the contract: namely, that they will notify the landlord in writing of the transfer of the business within one month. The landlord, and thus the sole owner of the building in which the business is located, has no claim against the new tenant. However, a valid transfer cannot take place if the lease stipulates from the outset that no transfer is permitted. Some leases contain a clause stating that if a transfer is to take place, the landlord can contribute a portion of the total amount when the business is transferred. In such clauses, the landlord's share is specified as 10% to 30% of the total amount. This results in the following: If you take over the business for €30,000, for example, the landlord receives €9,000 at 30%.
However, it's best to stay away from the methods mentioned above. Among other things, because you would be violating several laws. Tax law and the associated tax evasion could even land you in prison, depending on the amount involved. Therefore, it's advisable to stay away from such methods and keep everything transparent.
There has rarely been a lack of demand for commercial real estate. However, the prices for the transfer can usually be heavily renegotiated. This is partly because the operators often want or need to get rid of their business as quickly as possible. The desire to sell doesn't have to have anything to do with the poor location of the business or other reasons that could affect the business. In most cases, the operators want to transfer their business quickly in order to access the money and be able to invest. However, operators also often transfer their business because they are experiencing personal (financial) difficulties and urgently need money. Try to find out the reasons diplomatically so you can rule out the possibility that it might not be due to, for example, the location or reputation of the commercial property in question.
This type of business is very common and popular in Mallorca. The lucrative prices, in particular, are attracting more and more German tourists to Mallorca to open their own businesses there. A small shop in a village can be acquired for as little as €9,000 to €12,000. A cafeteria with a steady customer base can be acquired for as little as €30,000.
If you want to dig a little deeper into your pockets and take over a truly successful business, then you should especially look around Palma. For around €100,000, you can take over a restaurant with its regular customers. Such commercial properties are highly sought after here and are snapped up immediately. After all, Palma is the largest city in Mallorca. If you take over a business in the Palma's Old Town, you will definitely be able to operate successfully and record profits. Such an acquisition will most likely be worthwhile, as you take over the entire furnishings and all the merchandise and keep practically the same rental price. This way, you get a business in a relatively good location and will ultimately be able to quickly recoup your investment and make a profit.
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