A seaside restaurant charges 30 euros ($30) for a burger.
A large deckchair at an upscale beach club can cost 500 euros in August.
And a table in a “VIP” nightclub can number in the thousands.
Although Spain is generally considered a reasonably priced travel destination, the Spanish island of Ibiza has long been known as a place to live the high life.
“The price is silly,” luxury hotel consultant and longtime Ibiza visitor Ben Pundole said in an email to CNBC. “After 23 years in New York, I can only compare it to the Hamptons at the height of [the] season.”
Beachgoers and boaters in Cala Salada, Ibiza.
Alex Tihonov | time | Getty Images
Still, visitors to Ibiza are happy to spend big, Pundole said.
“Ibiza is very expensive, it has always been expensive,” he said. “But people are willing to pay.”
While the hippies were attracted to Ibiza for its rumor “magnetic‘Vibes in the 1960s, it was arguably British-Australian Tony Pike who put the island on the map when he opened the Pikes Hotel, now known as Pike Ibizain 1980. The small hotel has transformed a 500-year-old estate in the hills into a party haven.
Pike’s rich and famous friends such as Freddie Mercury, George Michael, and Kylie Minogue have stayed at the hotel — and it’s still a place that draws crowds to its rooms, restaurant, and dance floor.
The 1980s also saw the rise of clubs such as Amnesia, Space (now Hi Ibiza) and Pasha, the latter currently charging 13 euros ($13) for a regular can of Coca-Cola. Other clubs have opened since, including Ushuaia, which was named the third best club in the world in 2019 by the International Nightlife Association.
A can of Coca-Cola at a VIP table at Ibiza’s Pacha nightclub costs $13, while full-size liquor bottles start at around $500.
Zowy Voeten | Getty Images
Restaurants, clubs, vacation rentals and taxis have all significantly increased prices this year, Pundole said.
“It’s an island, it’s seasonal, businesses are making up for two years of lost revenue, there are supply chain issues and pent-up demand [post pandemic] is huge,” he said.
Indeed, the number of the number of tourists visiting the Balearic Islands has increased by 300% year-on-year in May, according to the Spanish National Institute of Statistics.
Ibiza’s reputation as a high-end destination has evolved over the past few decades, said Carolyn Addison, product manager at luxury travel specialist Black Tomato. “He’s got this kind of…established glamour. So there’s a lot of expensive deals,” she told CNBC over the phone.
“You’d have to go back to the ’60s when there was this kind of…hippie mob that washed ashore,” she said. “While this crowd may have become older, wealthier, more established, [it] defined the island in a new way.”
A six-night trip organized by Black Tomato starts at around £6,100 ($7,260) per person, including accommodation, breakfast and a full-day private yacht charter (price excludes flights) .
A six-night trip to Ibiza with travel company Black Tomato – with stays at places like 7Pines Resort Ibiza (here) – starts at around £6,100 ($7,260) pp, excluding flights.
Source: Black Tomato
Six Senses Ibiza is popular with Black Tomato customers, Addison said. The luxury hotel announced the addition of 19 private residences and two “mansions” in June.
Mansions cost around $16,000 per night in the summer, according to the hotel’s website. Guests have access to a spa, kids’ club, and daily activities like kayaking and cliff jumping. Each is accompanied by a “Guest Experience Maker” who can arrange nightclub admissions and boat trips, depending on the hotel.
Another novelty at Six Senses this year beach cavesa venue with a restaurant, live music space, recording studio and six suites with king-size beds, near the town of Portinatx on the north coast of Ibiza.
Pundole, who is the creative director of Beach Caves, described the area as having “a different vibe” and called it “curious, mystical, just as hedonistic and bohemian as anywhere you could imagine”. Beach Caves suites start from 1,565 euros per night in the summer.
The Cave Royale suite at Beach Caves, Ibiza. Room rates at the hotel start at 1,565 euros ($1,582) per night during the summer season.
Source: Beach Caves
This year, the luxury hotel group Mandarin Oriental also took over the management of Tagomago, a private island off the east coast of Ibiza. The entire island is available for rent for around 30,000 euros a night in high season, which includes a private villa, chef, concierge, butler, villa host and yacht captain, according to a promotional brochure.
Luca Finardi, COO of Mandarin Oriental Exclusive Homes, said Tagomago’s clientele includes “a variety of high-end individuals from around the world.”
Asked why Ibiza is so expensive, Finardi said via email that the island was popular with upscale travelers who wanted a combination of “beautiful scenery, high quality restaurants and bars, chic shopping experiences and vibrant nightlife”.
“It also offers beautiful spaces where customers can find quiet corners to escape the crowds,” he said. “It’s good value for money for people looking for those experiences.”
Tagomago Private Island includes a chef, butler, concierge, villa host and yacht access.
Source: Tagomago Island
At AMA Selections, a luxury home booking site launched in June, the average cost of a 10-day stay in a villa in Ibiza is around 26,500 euros, according to co-founder Mariek Anselme. Most customers add services such as pop-up cinema experiences – which start from 500 euros per screening – as well as private chefs, yoga classes and spa treatments.
“The island is able to strike a balance between authentic bohemian charm and high-end offerings popular among VIPs and affluent travelers,” Anselme told CNBC via email.
“For decades, it has attracted iconic names from the music industry, creating an elite and extravagant entertainment scene…In recent years, we have seen more and more global leaders in luxury hospitality open in Ibiza, giving it a world-class status capable of commanding high prices,” she added.