Discover why investing in a hotel with restaurant in the Alpujarra (Granada) can deliver up to 28% annual ROI in 2025. Compare it to residential rentals, explore real income projections for a 10-room turnkey complex, and learn why Andalusia offers lower risk and higher returns than Spain’s regulated housing market.
Why investing in a hotel business in Andalusia now offers higher returns—and fewer risks—than residential rentals
In the wake of Spain’s 2023 Housing Law (Ley 12/2023), traditional buy-to-let strategies in cities like Madrid and Barcelona have become increasingly complex, with rent controls, forced renewals, and steep penalties for non-compliance. As a result, savvy investors are shifting their focus away from residential rentals and toward ready-to-operate hospitality assets—particularly in regions where tourism is strong, regulation is light, and margins remain healthy.
One such opportunity lies in the Alpujarra, a stunning mountain region in the province of Granada, Andalusia. Here, a fully licensed hotel and restaurant complex—with 10 guest rooms, panoramic Sierra Nevada views, and 7 hectares of private land—offers a rare combination: **dual income streams, minimal regulatory risk, and a projected 28% annual return in 2025.
In this article, we break down:
- Why the Alpujarra outperforms coastal hotspots like the Costa del Sol in both profitability and sustainability,
- A realistic ROI calculation based on current market data,
- How this investment compares to residential rentals under Spain’s new rental laws,
- And why this moment may be your last window to enter Spain’s hospitality market before institutional investors move in.
For investors seeking passive income with upside potential, regulatory safety, and a lifestyle upgrade in one of Europe’s most authentic destinations—this could be the ideal next step.
Why the Alpujarra Offers Better Hotel Investment Potential Than the Costa del Sol
Many investors instinctively look toward the coast—especially the Costa del Sol—drawn by its long-standing reputation for high tourism demand and strong property values. But today, that very popularity has become a liability.
The coastal strip is now oversaturated with small hotels, guesthouses, and short-term rental apartments—particularly in hotspots like Marbella, Fuengirola, and Benalmádena. This intense competition has driven room rates down while marketing costs continue to climb, squeezing profit margins to their lowest in years.
Moreover, regulatory pressure is mounting: in several municipalities, authorities have suspended new VFT licences (Licencias de Viviendas con Fines Turísticos), making it increasingly difficult—or even impossible—to operate legally in the short-term rental market.
In contrast, the Alpujarra—a mountainous region in the province of Granada—offers a refreshingly different landscape:
- Low market saturation: There’s a clear shortage of quality mid- and upscale accommodation, creating space for new entrants without price wars.
- High-value travellers: Visitors come for authenticity, tranquillity, and unspoiled nature—not mass tourism. They stay longer, spend more, and are willing to pay a premium for a unique, meaningful experience.
- Favourable regulations: Unlike Catalonia or the Valencia region, Andalusia still issues tourism activity licences for hotels and rural properties, and the Alpujarra remains largely free of restrictive zoning laws.
In short: while the Costa del Sol battles overcapacity and red tape, the Alpujarra offers sustainable growth, higher margins, and a loyal, high-spending clientele—making it one of the most compelling hotel investment opportunities in Southern Spain today.
Demand for “Quiet Tourism” and Ecotourism in the Alpujarra Is Growing by 20% Annually
Since the pandemic, a profound shift has reshaped global travel: more and more visitors are turning away from crowded resorts and checklist tourism in favour of slow, meaningful, and locally rooted experiences—a movement widely known as “slow tourism.”
This isn’t just a buzzword—it’s a conscious lifestyle choice: less rushing, more depth. Today’s discerning guests don’t want to “tick off landmarks.” They want to live like locals: hike mountain trails, taste olive oil straight from a neighbour’s grove, sip coffee on a terrace overlooking the Sierra Nevada, and return home feeling truly refreshed—not exhausted from airports and queues.
The Alpujarra is one of Europe’s purest expressions of this trend. Far from mass tourism, it offers:
- Protected natural landscapes and crisp mountain air,
- A rich Moorish cultural heritage,
- The charm of whitewashed villages like Pampaneira, Bubión, and Capileira,
- And a thriving culture of organic farming and sustainable living.
According to Spain’s Ministry of Tourism, demand for destinations like the Alpujarra is growing 15–20% per year. Even more compelling for investors: these travellers spend 30–40% more per trip than average tourists. They book longer stays, cancel less often, and frequently return—creating a loyal, high-value customer base.
For investors, this means stable, high-margin occupancy even outside peak season—and a rare first-mover opportunity, as major hotel chains have yet to enter this pristine niche.
Motorcycle Tourism in the Alpujarra
The Alpujarra is also a legendary destination for motorcyclists across Europe. Its narrow, winding mountain roads, dramatic vistas, and fresh alpine air make it a dream route for riders seeking adventure and authenticity.
Every year, hundreds of bikers travel specifically to ride the scenic loops between the white villages of Pampaneira, Bubión, and Capileira—then gather in the cozy bars and restaurants of Órgiva to swap stories, enjoy hearty Andalusian home cooking, and soak in a spirit of freedom that only two wheels and open roads can deliver.
For a hotel with a restaurant, this loyal community offers predictable off-season traffic, strong word-of-mouth marketing, and a built-in audience that values quality, character, and location above all.
Investment Security Starts with the Right Guidance
Purchasing a hotel complex isn’t just a real estate transaction—it’s the acquisition of an active business. And like any business, what you see on the surface is only part of the story. The real risks—and opportunities—often lie hidden in the documentation.
As real estate professionals specialising in commercial properties in Andalusia, we do not charge buyers any commission. We don’t make decisions for you—and we don’t guarantee returns. Instead, our role is to ensure full transparency and connect you with trusted, independent experts who can help you make a truly informed decision.
What We Do During the Initial Evaluation Phase:
🔹 Review Available Documentation
We request all existing documentation from the seller, including:
- Operating licences (licencia de apertura, licencia de actividad),
- Technical certificates (energy performance, fire safety, accessibility),
- Booking history (if provided),
- And an overview of the property’s financial performance.
This is not a full audit, but it serves as a critical first filter to assess viability.
🔹 Prepare a Due Diligence Brief for Your Lawyer
Based on our experience, we know exactly what to look for. We’ll recommend a vetted local lawyer who will verify:
- The validity and transferability of licences (especially important in rural areas like the Alpujarra, where the Guardia Civil’s ICONA system applies instead of the national SCAV registry),
- Any outstanding debts (IBI property tax, VAT, utility bills, or administrative fines),
- Legal encumbrances, pending litigation, and compliance with safety and accessibility regulations.
🔹 Assess the Realism of Income Claims
If booking data, guest reviews, or platform metrics (e.g., from Booking.com or Airbnb) are available, we help you formulate the right questions for a financial advisor. However, the final profitability analysis must be conducted by an independent hospitality consultant—not by us.
Our Support: From First Viewing to Purchase Completion
We guide you through every step—from your initial site visit to the signing of the deed—by helping you:
- Arrange meetings with your lawyer and technical inspectors,
- Understand which documents are required to register the business in the Andalusian Tourism Registry,
- Connect with professional hotel management companies, if you plan to outsource operations.
Important: We do not guarantee profits, take responsibility for document accuracy, or replace legal counsel.
But thanks to our local expertise and trusted network, you gain access to all the information you need—with no hidden fees, no pressure, and no commission taken from your side.
A Turnkey Hotel Complex in Órgiva: 10 Rooms for 630,000€
Let’s examine a real opportunity: a fully operational hotel and restaurant complex in the municipality of Órgiva, nestled in the heart of the Alpujarra—one of Andalusia’s most authentic and rapidly growing tourism zones.
Important note: The financial projections presented in this article are conservative estimates, based on publicly available 2025 market data for the Alpujarra region (Granada province), including:
- 70% average occupancy during high season (April–October),
- 40% occupancy in low season (November–March),
- 35€ average spend per guest in the restaurant,
- A full-time staffing model.
Actual profitability may vary depending on operational factors such as:
- A more effective marketing strategy (e.g., achieving 80%+ occupancy),
- Upselling premium experiences (tasting menus, local wines, artisanal products),
- Monetising the 7-hectare plot for weddings, yoga retreats, private events, or wellness programmes.
For serious investors, we strongly recommend commissioning an independent financial analysis from a hospitality specialist. Upon request, we can connect you with vetted professionals who will prepare a detailed report—including best-case, base-case, and worst-case scenarios—tailored to your investment goals and risk profile.
Key Property Details: Hotel + Restaurant in the Alpujarra
- Location: Órgiva, Alpujarra, Province of Granada (Andalusia, Spain)
- Asking Price: 630,000€
- Asset Type: Commercial property – fully operational hotel and restaurant
- Land Area: 70,000 m² (7 hectares) of private, scenic terrain
- Built Area: 1,500 m² of fully licensed, maintained structures
- Accommodation: 10 double rooms, each with a private terrace and panoramic views of the Sierra Nevada National Park
- Restaurant: 21 tables (131 seats) + 7 bar tables (32 seats) + terrace ideal for weddings
- Facilities: Fully equipped hotel and restaurant, outdoor terraces, on-site parking, and all necessary operating licences in place
Tourism Potential:
- Órgiva is the gateway to the Alpujarra,
- Minutes from the iconic white villages of Pampaneira, Bubión, and Capileira,
- Direct access to the Sierra Nevada National Park (hiking, skiing, nature),
- A favourite destination for European motorcyclists and followers of slow tourism
Key Drivers
- Dual Income Streams: Revenue from both accommodation and restaurant operations ensures resilience and scalability.
- Unique Location: The Alpujarra is at the heart of Europe’s shift toward quiet, nature-based, and authentic travel—a trend with strong growth and low competition.
- 7-Hectare Plot: Offers significant upside through premium add-on services: yoga retreats, weddings, wellness weekends, and eco-tourism experiences.
- Regulatory Advantage: Unlike residential rentals, hotel businesses are NOT subject to Spain’s 2023 Housing Law (Ley 12/2023)—no rent caps, no forced renewals, no “vulnerable tenant” restrictions.
- Turnkey Operation: All furniture, kitchen equipment, terraces, and tourism licences are fully operational—no additional investment or delays required.
Revenue Projection
This hotel complex was originally run as a family business: the owners managed everything—from guest reception to kitchen operations and event coordination. The restaurant, and especially weddings and private events on the panoramic terrace overlooking the Sierra Nevada, were the main sources of income.
Weddings, in particular, became a key profit driver during high season, thanks to the property’s 7-hectare plot, privacy, and authentic atmosphere—a compelling choice for couples seeking a unique, non-commercial venue.
If operated with hired staff, the minimum team would include:
- 1 manager (reception, bookings, coordination),
- 1 chef (full kitchen cycle),
- 2–3 waitstaff (depending on restaurant occupancy and events),
- 2–3 housekeeping staff (rooms, restaurant, common areas).
This structure ensures smooth operation of both the hotel and restaurant, including large-scale events.
Based on a conservative scenario—factoring in seasonality, current room rates, and average restaurant spend—the projected ROI reaches up to 28% per year, with a payback period of under 4 years.
💡 Important: This figure is indicative. Actual profitability depends on multiple factors, including service quality, marketing efforts, occupancy levels, and cost management.
If you’re considering purchasing this asset and would like a custom financial analysis—including detailed staffing, social security contributions, taxes, and wedding/event potential—we’ll prepare a tailored report upon request.
Investment Comparison: Alpujarra Hotel vs. Other Options in Andalusia (2025)
| INVESTMENT TYPE | NET YIELD | PAY BACK PERIOD | REGULATORY RISK |
| This hotel complex (Alpujarra) | ~27% | ~4 years | Low– not subject to Ley 12/2023; full tourism licences in place |
| Residential apartment (Málaga, long-term rent) | 4–6% | 15–20 years | High– rent caps, forced renewals, and penalties under Ley 12/2023 |
| Luxury villa (Nerja, short-term rental) | 8–12% | 8–10 years | Medium– requires VFT licence; platform dependency; seasonal volatility |
| Land for development (undeveloped plot) | 0% (until resale) | 5–10+ years | High legal risk– zoning changes, planning delays, construction cost overruns |
✅ Key takeaway: Unlike residential rentals—now heavily restricted under Spain’s 2023 Housing Law—hospitality businesses like this hotel are classified as commercial activity, exempt from rent controls and tenant protections. This makes them one of the last truly free-market investment opportunities in Southern Spain.
Investor Takeaway: Why Now Is the Time to Act
The hotel business in the Alpujarra is far more than just real estate. It’s a turnkey income-generating asset with two complementary revenue streams—accommodation and restaurant—located in one of Southern Spain’s most sought-after tourism destinations.
This isn’t just another investment. It’s a rare window of opportunity to enter Spain’s hospitality market with:
- High margins (projected EBITDA ROI of 27.7%—5–6 times higher than the 5–6% average for residential rentals in Spain),
- Fast capital recovery (payback in under 3.7 years),
- Stable, diversified income from a loyal, high-value clientele,
- And minimal regulatory risk—because hotel operations are not subject to Spain’s restrictive 2023 Housing Law (Ley 12/2023).
While institutional investors are only now beginning to notice this niche, early movers still have first access to exceptional assets like this one—fully licensed, beautifully positioned, and ready to operate from day one.
Are You Ready to Take the Next Step?
We provide end-to-end support—from your first site visit to the full launch of your business. Upon request, we’ll connect you with a vetted local lawyer to conduct a comprehensive due diligence, including:
- Verification of all tourism and restaurant licences,
- Legal title and debt checks,
- Compliance with Guardia Civil (ICONA) guest registration requirements,
- Assessment of operational and financial risks.
Most importantly: we do not charge buyers any commission.
Our goal is simple—to help you invest safely, transparently, and profitably in one of Andalusia’s last untapped hospitality gems.
