Tourism Minister Konrad Mizzi told The Malta Independent today that the new valuation being conducted regarding the Corinthia deal is not about a new formula, but about the new parameters agreed upon.

The Minister, while providing a gist of what the new parameters are, remained adamant in not providing specific details at this stage, such as the amount by which the residential component is proposed to be reduced.

The initial deal would have seen Corinthia Group change the terms of an emphyteusis, on land which they have rights to in St. George’s Bay on a 99-year lease. The change would have allowed the Corinthia Group to develop residential apartments, rather than just use the land for tourism purposes, for just a €17 million payment. This idea however was taken back to drawing board last February after extensive pressure from all fields

Earlier this week, Mizzi said that the government had sat down with Corinthia to discuss new parameters which the government had received feedback on from various stakeholders. He said that Corinthia had agreed to “most” of the new parameters, but that before discussions proceeded further, a new valuation based on these new parameters had to be carried out.  The government, Mizzi had said, had appointed Colliers International to carry out this valuation and that once this is completed, they would sit down once again with Corinthia and advise them of the new valuation as per the new parameters.

Mizzi had long defended the valuation formula for the db Group land deal by Deloitte. Asked yesterday why he has decided to change his mind, and appoint a new firm to change the formula, and told that the outcome could lead to the deal with the db Group officially being seen as having been disadvantageous for government, Mizzi said that they are not working on a new formula, and what is happening is something different.

“The db Group project is a different project, where there was a tender issued according to EU directives and everyone had the opportunity to bid. A decision was taken based on the tendering process. In the Corinthia’s case, government has been working on it since 2014. A Memorandum of Understanding had been signed and I was given direction from Cabinet to work to close the deal to assure the regeneration of the St George’s Bay site. When we announced the details of the proposed plans we had certain feedback and criticism from  NGOs, environmental stakeholders, developers and others. We listened and addressed that feedback.”

“We spoke with the Corinthia about the foreshore and addressed it, we spoke about land reclamation and removed it. We spoke to them about having more open spaces, we spoke to them about reducing overdevelopment, we spoke to them about not being able to sell the project for speculation. On all of this we agreed.”

“What we are doing with Colliers International is different. They will not be repeating the Deloitte valuation. They will evaluate the new parameters on the basis of what we discussed with Corinthia, on the basis of the feedback we received from the stakeholders. I think nobody doubts Colliers International who are a world class firm... I wait for them to conclude their work, and once we have their report we can present that report to Cabinet and the stakeholders,” he said.

Asked what the parameters of this new exercise are, and told that the first question still stands, since effectively there is a new formula, he said “no, it is not a question of a formula but of parameters. A valuation occurs on the basis of parameters. The parameters changed in terms of how much development, how the development will take place and where. We spoke with Corinthia. We will now wait for the valuation and once we have it and I have clearance from Cabinet, I will communicate the details.”

Asked for the specifics of the parameters, he said that there must not be land reclamation, that the development reduce, that there be more open spaces, that there be more emphasis on tourism, that there be access to the foreshore and no land reclamation, that the property cannot be sold and others. The Corinthia agreed on all, but now we need to wait for the experts to conclude their valuation.”

He said that the government will stay on what the experts decide.

Asked for the exact amount reduced in terms of residential development, Mizzi said he will give details once the valuation is complete and he has the approval from Cabinet. Pressed, he admitted that the reduction in residential development is part of the valuation process, however remained adamant in not revealing such details until he has clearance from Cabinet on the next steps.