In a series of decisions, the country's highest court has declared null and void Marbella's urban planning regulations that were passed in 2010 and which legalised thousands of homes constructed since the previous town plans, dating back to 1986, were approved.
In response to appeals against previous Supreme Court of Andalusia rulings, the rulings all arrived at the same conclusions, namely that the Town Council does not have power to retroactively declare legal properties that have been built illegally as that rests with the courts, nor to alter land classifications, nor legal liabilities.
According to Adam Neal of real estate firm Terra Meridiana it means that individual property owners, even those who bought in good faith, will be held liable for illegal constructions, rather than passing the responsibility on to developers, as the 2010 plan sought to do.
He explained that much of the problem arose during the three terms of the GIL (Grupo Independiente Liberal) government, from 1991 to 2003. The then mayor Jesús Gil is regarded as having run the council like a fiefdom, with claims of cash being funnelling under the table in exchange for carte blanche building licenses.
‘Subsequent administrations, under mayors Julián Muñoz, Marisol Yagüe, and Tomás Reñones, all sentenced to jail time for offences following the Caso Malaya scandal, were little better, leading to the suspension of the entire Town Council in 2006 by the central government, to make way for a team of auditors who tried to unravel Marbella's finances,’ he said.
Neal believes that now all the paperwork for every property built within Marbella's municipal area since 1986 will need to be looked at very carefully indeed. ‘There are two possible outcomes: either a property is legal, because it was built on urban land as per the 1986 town plan, or it isn't, because it wasn't,’ he pointed out.
According to Mark Stucklin of Spanish Property Insight it is bad news for the local property market, which was one of the few real estate bright spots in Spain until now. ‘It drags Marbella’s reputation back into the dirt by reminding people of its corrupt past, whilst the uncertainty will put off buyers and investors,’ he said.
He pointed out that the decision could mean no more new building licences for the foreseeable future, plunging the residential construction business back into crisis just when it looked like recovering after more than a decade of downturn.
Ricardo Arranz, president of the National Association of Urbanisation Developers, said the decision was right and expected. He explained that the industry welcomes the demise of the 2010 revised plan.
‘It was an unmanageable plan, absurd in every way and had started to scare off investors. It was done in a hurry by architects who knew absolutely nothing about the needs of Marbella and its property market. And it was all supported by a public administration that had the grave responsibility of approving a plan they knew perfectly well was good for nothing,’ he added.
But he pointed out that while the revised plan was a disaster, coming up with a new plan that works for Marbella will be complicated and problematic given the current political reality of a town hall governed by a coalition of four different parties.
The good news is that recent legislation in Madrid now ensures that buyers in good faith have to be compensated before any Spanish homes are demolished. ‘Purchasers have the protection of the articles we have managed to introduce – no demolition without compensation for good faith purchasers,’ said Gerardo Vazquez, a lawyer and activist fighting for property rights in Spain.
Marbella's Town Council and the regional government of Andalusia will be studying the rulings closely over the next few days to determine the implications and come up with solutions, according to the current mayor, José Bernal.
Marbella now has to go back to the drawing board for a new town plan, which could take years and hang like a cloud over a market that would otherwise have some of the best potential in Spain.
