A new urban planning reform proposed by the municipality of Las Palmas, the capital of Gran Canaria, has triggered a wave of concern among property owners and investors. While local authorities claim the initiative aims to modernize the city, reduce urban congestion, and promote sustainable development, critics fear it could lead to forced expropriations and a devaluation of real estate assets in key neighborhoods.
The debate reflects a broader trend in European cities, where the pressure to adapt urban environments to modern needs often clashes with the rights of private property owners.
What Does the Reform Propose?
The reform package, introduced by the Department of Urban Planning in Las Palmas, outlines significant changes to land use and urban structure, particularly in densely populated or irregularly developed areas. Its main components include:
- Reconfiguring the road network to prioritize pedestrian and bicycle-friendly zones
- Creating new green corridors and public spaces in areas lacking infrastructure
- Limiting building heights and densities in designated urban zones
- Introducing “areas of public interest”, which could allow for fast-track expropriations
- Implementing climate-adaptive measures, including low-emission zones and restrictions on car use in the historic center
According to city officials, the reform seeks to ensure more sustainable urban growth, promote environmental resilience, and enhance the quality of life for residents.
Property Owners Raise Red Flags
Despite the optimistic narrative from the city council, many property owners are worried that the reform could have unintended—and severe—consequences. Chief among their concerns is the risk of forced expropriation or land-use reclassification, which could make it impossible to renovate, sell, or rent properties under the new guidelines.
Key concerns include:
- Vague definitions of what constitutes an “area of public interest,” creating legal uncertainty
- Undervalued compensation for expropriated properties, particularly older buildings that do not meet new energy efficiency standards
- Unclear timelines and criteria for implementation
- Negative impact on small businesses that may be forced to relocate or lose customers due to infrastructure changes
María López, a local property owner in the Vega de San José neighborhood, explains:
“Our building is old but functional and rented out. Now I hear it could be deemed obsolete and subject to acquisition. What happens to us and our tenants?”
Investment Climate at Risk
The reform is already having a chilling effect on real estate transactions. According to Canaria Inversión Urbana, property sales in central and eastern districts of Las Palmas dropped by 22% in the first half of 2025 compared to the previous year. Properties located in zones identified for potential redevelopment have seen price drops of 8–12%.
Las Palmas has long been attractive to domestic and foreign investors alike due to its strong rental yields and limited housing supply in central areas. However, real estate consultancies such as Grupo Atlántico Real report that about 30% of clients exploring investment opportunities in areas like La Isleta have put their plans on hold or withdrawn altogether.
Expert Views: Reform Necessary, but Transparency Is Key
Urban development experts broadly agree that modernizing city infrastructure is essential, especially in areas facing climate risks, gentrification, and demographic pressure. However, they caution that reforms must be based on legal clarity, transparency, and fair compensation.
Juan Pérez, professor of urban planning at the University of Las Palmas, warns:
“No city can evolve without intervention. But intervention must be lawful, proportionate, and compensated. Otherwise, trust in governance erodes quickly.”
He adds that the lack of clarity and consultation could send negative signals to investors at a time when capital is already cautious across European real estate markets.
Legal Challenges and Public Pushback
In response to growing concern, local law firms such as LexCan Abogados have started preparing legal actions to challenge what they consider unconstitutional expropriations. Lawsuits are expected to center around:
- Lack of legal certainty and transparency
- Insufficient public consultation during zoning decisions
- Potential violations of property rights under Spanish and EU law
- Inadequate and delayed compensation mechanisms
Several property owners have already filed formal requests for clarification and preliminary injunctions to halt the reform’s implementation in key districts.
Official Response
In June 2025, Mayor Alejandro Ramírez held a press conference to reassure citizens that “no resident will be left without a home, and each case will be evaluated on its merits.” He emphasized that the plan promotes collaborative redevelopment rather than forced displacement and mentioned the possibility of land swaps or renovation subsidies for affected owners.
Still, no binding legal framework has yet been approved to guarantee these assurances, leaving many unconvinced.
Real Estate Market Impact
As of July 2025, average property prices in older neighborhoods range from €1,800 to €2,200 per square meter. In areas designated for new pedestrian zones or green corridors, prices have fallen to as low as €1,600/m². By contrast, in unaffected neighborhoods such as Tafira or Ciudad Alta, prices remain stable at €2,400–2,600/m², and buyer interest is up 17% year-on-year.
Rental yields have also seen a mild dip, especially in areas subject to zoning ambiguity, with some landlords reporting longer vacancy periods and lower demand.
Broader Implications for European Cities
Las Palmas is not alone. Cities such as Amsterdam, Berlin, and Paris are also struggling to balance sustainability goals with property rights. The case of Las Palmas highlights the importance of policy clarity, stakeholder engagement, and gradual implementation to avoid social backlash and market disruption.
Urban planning is a complex balancing act: public benefit must be weighed against the economic and legal interests of property owners and investors.
Conclusion
The urban planning reform in Las Palmas marks a turning point in the city’s development strategy. While its goals—greener spaces, better mobility, and sustainable growth—are widely supported, the method and pace of implementation risk alienating both residents and investors.
Without stronger guarantees on property rights, clearer legal frameworks, and more transparent communication, the reform may do more harm than good. To truly modernize the city, policymakers must find a path that aligns collective needs with individual rights—a challenge many European cities will face in the years ahead.
