Pavi, the shopping complex at Qormi, is to issue a Lm5 million (EUR11,646,867) secured bond backed by property valued at Lm8.4 million and carrying a coupon of 7 per cent.

This is bound to be one of the more interesting investment opportunities to come on the market this year– not just as viewed by corporate investors but also by the vast clientele that shops at Pavi. It should appeal to the retail market due to such solid backing and attractive yield.

The bond carries a higher yield than some of the bond coupons seen recently. The bonds are available at a nominal value of Lm100 (subscription will be in minimums of Lm1000) and are due for redemption in 2017 unless of course redeemed early by the issuer in October of any year from 2014 onwards.

Pavi, by far Malta’s largest shopping complex, has an issued share capital of Lm3.6m all of which is fully paid up.

Subscriptions are set to open on 15th October and will close four days later on the 19th. An announcement on the basis of acceptance will be made on 26th October and commencement of interest will start on the same day.

The Pavi Bond will be traded on the Stock Exchange’s Alternative Companies List. Charts, the investments management services company, is acting as the sponsoring stockbroker while Bank of Valletta is the security trustee.

This is the first time the public is being invited to buy bonds issued by a shopping complex. Admittedly this is an unrivalled shopping venue whose turnover is both impressive and rising. Sales by Pavi in the first six months soared close to Lm4.7 million. This is expected to rise to Lm9.2m in the first year of trading. The thousands of people who shop at Pavi – some 30,000 shoppers visit the complex each week – might view the combination of investing in a complex where they also do their shopping as an attractive proposition, and more so if, as often happens, the issuer were to decide, at a later stage to offer stockholder/shoppers additional privileges like, for example, special discounts on, say, a certain amount of shopping they do there.

Pavi, which came on stream 11 months ago, was given the go ahead to launch its bond by the MFSA on 28th September.

The company is the outright freehold owner of the site and the complex building – which stretches across 16,000 square metres of shopping area, parking lots and storage facilities. The site was acquired from Castellana, the Italian jeans manufacturer.