Madrid and several nearby cities have begun a large-scale transfer of municipal land to private companies for decades to come. This decision has already sparked heated debate among residents and politicians, as it concerns a hundred plots where new schools, homes for the elderly, and thousands of apartments with promised affordable rents are planned. For Spaniards, this means that familiar city services may change, and access to them could become less predictable.
According to El Pais, since 2019, regional authorities led by Isabel Díaz Ayuso and local city halls have already handed over or plan to transfer 100 municipal sites to private operators. Most of these territories once belonged to the cities and will now be used for projects designed for 40–70 years, sometimes even longer. After the lease expires, the buildings will return to municipal ownership, but during this time private companies will manage them, combining the provision of public services with commercial activities.
Long-term contracts
The scheme is straightforward: companies receive land for free, build schools, homes for the elderly, or residential complexes, and then manage them for decades. During this period, they are required to allocate a portion of the capacity for public needs, while the rest is rented out or services are sold at market rates. For example, in the new residences for the elderly, the authorities will reserve 2,400 places, and another 1,755 places can be leased by companies at commercial prices. In the schools, some students will study for free, while others will pay tuition.
Authorities explain that this approach speeds up the launch of new facilities and helps save the budget. However, the opposition and some experts argue that this will lead to decreased oversight of quality and access to services. According to the Socialists, handing over land to private companies is not just about saving money—it’s a shift in the model, where business interests may outweigh those of the public.
Geography of change
The transfer of land plots affects not only the capital, but also cities such as Móstoles, Alcobendas, Tres Cantos, Torrejón de Velasco, and Torrejón de la Calzada. New facilities managed by private operators will be established in each of them. Notably, local governments make the decisions about transferring the land, and after the 2023 elections, most town halls are controlled by the Partido Popular, which supports Ayuso’s initiative.
The Socialists have called on their mayors not to participate in such projects, seeing them as a long-term gift for businesses. They worry that in 40–70 years, the city might face a shortage of land for its own needs, and residents may see higher service prices. Supporters of the scheme insist that without private investment, new schools and care homes would not appear anytime soon.
New rules for schools and care homes
Special attention is being given to partially state-funded schools. Previously, these institutions could use municipal land as collateral for construction loans. Now, the practice is expanding: private operators will be allowed to build and manage schools, offering some seats free of charge and others at full cost. In care homes and day centers, companies will be granted the right to charge for additional services, such as parking or cafés.
The first new residences for seniors are expected to open in the summer of 2028. While the system is just being launched, it is clear that it will change the established order: some spots will remain available for those in need, while the rest will go to those able to pay more. This raises concerns that access to vital services will become less equitable.
Debate and consequences
The transfer of municipal land to private companies has sparked a real political battle. Critics warn of the risks: if city services fall into the hands of businesses, residents’ interests could become secondary. Supporters argue that without such measures, new facilities won’t be built and the budget can’t bear the costs. Similar debates have already taken place in Spain when it came to upgrading infrastructure or implementing emergency support for regions. Recently, for example, the authorities allocated all available resources to restoring Andalusia after natural disasters, as detailed in the article on the large-scale mobilization of funds to support the regions.
According to El Pais, the new scheme of transferring land to private owners could become a model for other regions. In recent years, Spain has already seen similar initiatives discussed, as cities searched for ways to accelerate the construction of social facilities without increasing debt burdens. In some cases, such projects led to a rise in the number of new schools and housing, but also raised questions regarding transparency and oversight. In other regions, similar schemes were rejected due to concerns over losing control of urban infrastructure. All eyes are now on Madrid: whether it will be possible to maintain a balance between the interests of residents and business remains to be seen.
