Benidorm, one of Spain’s most famous resorts, has found itself at the center of a major financial crisis. The reason is a long-standing legal dispute over land in the Serra Gelada natural park, which could leave the city facing compensation payments of more than 340 million euros.
The story began back in 2003, when the Murcia Puchades family reached an agreement with the municipality. At the time, the city authorities, led by Vicente Pérez Devesa, arranged to transfer land plots in exchange for development rights in other areas of Benidorm. However, in 2005, regional authorities declared Serra Gelada the first marine and land natural park of the Valencian Community, which completely prohibited any construction on these territories.
The landowners did not object to the creation of the park, counting on the agreement’s conditions being fulfilled. In the following years, the agreement was extended, including during the administration of socialist mayor Agustín Navarro. However, the obligations were never met, and the land’s value was estimated at around 280 million euros. With no action from the municipality, the owners went to court, insisting the city had effectively become the owner of the plots but failed to pay compensation.
The municipality, in turn, argued that the agreements were no longer valid because the land was not officially transferred, and its designation as a nature park made it unsuitable for development. In 2021, the court of first instance sided with the city, but the landowners appealed. In 2022, the High Court of the Valencian Community ruled in favor of the Murcia Puchades family and urged the Benidorm authorities to negotiate.
The current mayor, Toni Pérez, decided to continue the legal battle, but the Supreme Court of Spain rejected the municipality’s arguments. Interest was added to the main compensation amount, already exceeding 60 million euros, bringing the total payments to more than 340 million euros. This is almost two and a half times the city’s annual budget.
Faced with this situation, the Benidorm administration turned to the Constitutional Court, requesting a suspension of the ruling to avoid immediate bankruptcy. Authorities warn that paying such an amount will lead to massive staff layoffs, cuts in municipal services, and inflict irreparable damage on the city’s economy.
The mayor acknowledges that without support from the state or the autonomous community, the city will not be able to meet its financial obligations on its own. Meanwhile, interest continues to accumulate, and the opposition blames the city’s leadership for mistakes and is demanding the mayor’s resignation, pointing to a lack of transparency in the extension of the agreements.
Local socialists believe that the court’s decision will negatively affect the future of several generations of Benidorm residents. They emphasize that in the past, agreements were extended with the support of both leading parties; however, the authorities’ position later changed, leading to the current crisis.
In response, representatives of the ruling party insist that failing to review the agreements could have resulted in criminal liability for abuse of power. They also point out that in several other court cases, the courts sided with the municipality and declared similar agreements invalid.
The legal conflict over Serra Helada has become one of the largest in Benidorm’s history and has threatened the financial stability of one of Spain’s leading tourist destinations. In the near future, the city’s fate will depend on the decision of the Constitutional Court and possible support from regional and national authorities.
