The municipality of Mogán, in southern Gran Canaria, is once again facing a lack of business interest in its project for 202 affordable homes. The tender, which sought construction companies to build and manage these homes under the Incentivized Affordable Housing model on Zaragoza street, has been declared void for the second time as no firms submitted bids.
These homes were intended for regulated rental, with prices equivalent to those of Social Housing (VPO). Mayor Onalia Bueno stated in a press release that the council had introduced measures to facilitate participation and access to financing, including covering 50% of the corporate guarantee required by banks.
"The Mogán City Council has done everything possible to move forward with the procedure," said Bueno, who suggested that the absence of bids underscores the complexities of the public-private collaboration model for such developments. "We understand that companies, in the end, want money to build and not to risk their capital," she added.
The contract was divided into two independent lots, structured through surface rights on municipal land. The awarded companies would undertake the investment in construction and management, while the land would remain publicly owned. Incentives included a 97.5% discount on the Construction, Installation, and Works Tax (ICIO), exemption from surface rights fees, no land use fees, and a 50% discount on Property Tax (IBI) during the rental exploitation period.
In light of this situation, the Mogán City Council is considering executing the works directly. According to the mayor, the council already has financing for the homes in Veneguera and is assessing the necessary funds for the projects in El Horno (Mogán pueblo) and Puerto Rico, including the first phase of the latter, which already has a project.
Bueno indicated that the municipality might need to resort to borrowing to address the housing "emergency situation" in the Canary Islands and specifically in Mogán. "The Mogán City Council will take the initiative again, as we have done with previous developments," she concluded.
The two developments in Motor Grande, located on Zaragoza street, represented a total investment of 24 million euros. The first lot planned for 72 homes with garages and storage rooms, had a budget of 8.2 million euros and an execution period of 30 months. The second lot included 130 homes, also with garages and storage, requiring the full project to be drafted, with a budget of 15.8 million euros and a 38-month timeframe.
The Incentivized Affordable Housing model stipulates that the homes must be used for regulated rental for ten years, with prices capped at those for protected housing. After this period, a phase for selling the homes was planned, with the possibility for tenants to acquire them at an affordable price.
