"I've always refused to privatise"
José Maria Alvarez del Manzano has played an instrumental part in the development of Feria de Madrid. Today, as president, his attention is also geared to internationalisation.
You were mayor of Madrid for twelve years. Do you miss political life?
The office of mayor is with a doubt the most attractive for a politician, because it puts you in close touch with the people.
It was under your aegis as mayor that IFEMA (Feria de Madrid) came into being.
I have been closely connected with IFEMA for 25 years. When the idea of turning Madrid into an exhibition city was born - and, incidentally, it came from Adrian Piera, the Chamber president, and the then mayor of Madrid José Luis Alvarez - I held the position of deputy mayor at the City Hall and thus became a member of the IFEMA administrative board. During my spell as mayor of Madrid I then developed the exhibition company. For me, it was always an extremely important factor in terms of the city's development.
You have been president of IFEMA for 14 years now, even though you no longer hold office as mayor.
The exhibition company is run by a consortium that depends on four institutions: Madrid City Hall, Madrid State Government, the savings bank CAJA Madrid, and the Chamber of Commerce. According to the statutes, the mayor is actually president of IFEMA at the same time. But for the first time an exception was made by allowing me to remain in office as president acting on behalf of the City Hall. The revised statutes now stipulate that the mayor shall be president, or the person assigned that office by the mayor.
How is the exhibition company developing?
Growth has always been geared to the necessities of the city and business demand. To begin with we had eight halls. Two were subsequently added and later another important conference centre built at the northern entrance. And we are currently in the process of building another two big halls. We have expanded gradually in line with demand and exhibitors need for space. There were times when we had to put up extra tents at some fairs to satisfy demand. Naturally, we want all businesses exhibiting here, and the visitors, to find quality facilities.
And what has your experience been in recent years?
We have unquestionably become the number one exhibition company in Spain, and we're one of the Big Five in Europe. We possess substantial infrastructure and vast service quality.
IFEMA is relatively young compared to other international exhibition organisations. Yet it's still the top dog in Spain. How do you achieve something like that?
We've invested a lot of money, because we knew we had to be as modern as possible to be competitive. We wanted to rival the biggest cities in the world, because Madrid is one of those big international metropolises.
How has growth been in the past few years?
Some fairs have posted growth of 5 % to 10 % recently. The art fair Arco, for instance, has expanded by 10 %. This makes Madrid the world's number two on the art scene, after Basel, in respect of modern art.
How can Madrid Fair be growing when business is declining elsewhere?
I think we have an edge on other exhibition companies in that, as a public consortium, we don't make profits that have to be distributed to shareholders. As a public institution we plough back all our earnings. The fact we don't pay dividends gives us flexibility, which is very important. It certainly enables us to grow with greater equanimity than companies dependent on business results for their continued existence.
Is that a model you could recommend to other exhibition organisations?
Generally speaking, I am in favour of privatising business, as I proved during my time as mayor. But I deliberately refused to privatise IFEMA. Were we reliant on private investment, we would have to pay dividends. But since we're engaged in public-sector activity, we can reinvest. That is why we have been able to carry out all the extensions without the cooperation of the institutions that make up the exhibition company. We weren't dependent on their freeing up funds. I consider this a key factor for positive development.
What projects are ongoing to take the company forward?
We are expanding our parking space to give us 12,500 parking lots in all. And as I speak we're building two new halls that will lift our capacity from 150,000 m2 to 200,000 m2. Each hall will be 25,000 m2 big.
How much is being invested on this?
For the latest investment we're currently making we will spend more than EUR 100,000 million, all of which will come from internally generated funds, with no borrowing.
What impact does IFEMA have on the economy in the city of Madrid?
It is extremely important. To help make its economy more dynamic and for the city's image, Madrid needs institutions that attract visitors while also creating jobs and prosperity. We are therefore interested primarily in two things: the new convention centre we have built and the exhibition company. Meanwhile IFEMA accounts for 1 % of Madrid's gross domestic product, directly and indirectly it creates 35,000 jobs and generates induced earnings for the municipality of EUR 1.5 billion a year.
Berlin plans to increase the number of annual hotel roomnights from 11 million to 15 million. Does Madrid have similar plans?
Madrid needs more hotel beds, particularly with regard to organisation of the Olympic Games. In comparison to our Olympic rival Paris, Madrid trailed the French capital in one respect only - the number of hotel beds. To beat Paris, we need more hotels. We know that this is very important for IFEMA, too. When big fairs are upcoming, all the hotels in the surrounding towns as well, such as Alcalá de Henares, Toledo and others, are full. These plans therefore take priority, but always on the basis of reasonable planning. Hotel developers that no longer require their accommodation after hosting the Olympics will therefore be permitted to convert them into offices or apartments.
You said Madrid wants to host the Olympic Games in 2012. How do you see its chances?
I think the programme we have is very good. The infrastructure in Madrid is such that the city could organise an Olympic event. Ultimately it will be a fight-out between Paris and Madrid. I hope the final decision is in favour of Madrid!
Back to exhibition business. How far do the exhibition company's activities extend?
We are part of Europe, and that's where we want to stand. On the other hand, we're pushing ahead with internationalisation. We have opened offices in many parts of the world, in Central and South America, in the US, in Miami, and we're even in contact with China at the moment. There are no boundaries for us. We have great ambitions to internationalise our activities.
Does that mean IFEMA is going abroad?
Yes, we're in the process of doing so. We are in touch with companies that plan to organise fairs together with us. Perhaps we'll arrange a fair in Peking; and we have possibilities for activities in Buenos Aires and Mexico.
Are you looking to launch the "Spanish model" on the market?
Yes, we can only export what we know. That way we've achieved acceptance in China. Peking wants to build new fair companies, and we have won the international competition to put these plans into practice. We are currently developing a project for Peking to realise the construction, financing and management of new fairs on the basis of our models.
What are your absolute priorities?
Our absolute priority is to offer our citizens the very best service and to try and launch new exhibition activities. After all, the other Spanish cities are looking to compete with us: Bilbao has built a new exhibition site, and Valencia also has new, very good exhibition facilities. And then there are the smaller cities such as Málaga with a new exhibition centre. Barcelona, which in the past held a monopoly as the premier exhibition location, is investing in new expo facilities. That's why, while acknowledging the importance of internationalisation for IFEMA, we cannot afford to disregard our domestic competition, because it's intensifying. Interview: Bärbel Martens
m+a report Nr.2 / 2005 vom 23.03.2005
m+a report vom 23. März 2005