Monchique Council has foregone around €500,000 in property transfer tax, handing an exemption to a group of investors buying the Caldas de Monchique Spa Resort.
Adrian Bridge, the CEO of the Fladgate Partnership, Unlock Boutique Hotels and one of the companies that owns the Águas de Monchique bottled water business, have agreed to buy the site from Fundação do Oriente.
The Monchique Municipal Assembly already has approved an exemption request from the highly liquid consortium which now will not have to pay IMT, Municipal Tax on Real Estate Transactions when the sale goes through.
This give-away by a Council that does not give the appearance of being flush, was a ‘key condition’ for the deal and again shows the inability of local Councils and other State entities to negotiate in the commercial arena without causing division.
This is no criticism of the consortium partners whose business reputation is exemplary and it is hoped that in the medium and long-term the municipality will benefit many times over from an increase in tourism, local employment and IMI rates income but the public relations downside from a deal involving a subsidy by local ratepayers, is significant.
The Monchique mayor, Rui André, (pictured) says the exemption was granted for 'the good of the municipality,' but faces awkward questions from his electorate when it realises that the Council could have been €500,000 better off – he already has been criticised by his own PDS party colleagues and the Assembly vote was not unanimous, with four votes against and one abstention from the 18 Councillors.
The Caldas de Monchique thermal baths and its associated infrastructure is one of Monchique’s gems yet has suffered at the hand of the Oriente Foundation which has failed adequately to invest. The 'Villa Termal' is a resort made up of historical buildings converted into hotel rooms, an outdoor thermal water pool, a thermal spa, meeting rooms, restaurants, shops and a wine bar.
The therapeutic properties of the Monchique water have been recognised since at least the time of the Roman Empire, when the spring was designated as ‘sacred waters.’ Eight springs provide water rich in bicarbonate, fluorine, silica and sodium. These waters flow in temperatures between 27°C and 31.5°C.
The new consortium will spend ‘around €10 million’ according to the mayor, as it renovates and develops the business and the buildings.
