The Malta Independent 22 August 2019, Thursday

White Rocks complex valued at €120 million, almost five times consortium’s offer

Rachel Attard and Neil Camilleri Sunday, 3 February 2019, 10:00 Last update: about 8 months ago

The government has estimated the value of the White Rocks site in Baħar iċ-Ċagħaq at around €120 million, which is almost five times what the White Rocks Development Consortium (WRDC) is offering, this newspaper can reveal.

Government sources said the reason why no deal has been reached yet is that the consortium disagrees with the price set by the government.

A government source told The Malta Independent on Sunday that the deal is not off yet, and that some "last tentative meetings" will be held over the coming days.

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It had previously been reported that the 450,000-square-metre former holiday complex had a market value of around €350 million. The Malta Independent on Sunday has been told, however, that the ex parte valuation carried out for the government is around €120 million.

The WRDC, led by hotelier Tony Zahra, plans to develop the area into a mixed-use complex, which would include a seven-star luxury hotel along with leisure, hospitality, residential and commercial units. The investment for the land in question is expected to total €400 million.

Tony Zahra had told this newsroom in January 2018 that the consortium was paying "top dollar, the highest of the market prices" for the site. While he would not divulge the price, Zahra had insisted that certain elements needed to be factored in, including a substantial investment in the surrounding infrastructure and road network which, he said, would cost €80 million.

The consortium had reached an agreement with the government over the use of the site in January last year, but talks stalled when it came to the price the developers were to pay for the public land. Ten months ago, the consortium said it hoped that an agreement on the price would be reached within days.

But in August last year, Economy Minister Chris Cardona told this newspaper that the parties had not registered any progress over the preceding three months, pointing out that the "right conditions" and the "right price" were important when dealing with public land.

Then, two weeks ago, in reply to a parliamentary question, Cardona said that negotiations on the project were at an "advanced" stage."

This newsroom sent questions to the consortium regarding the price it was willing to pay for the land. A spokesperson for the consortium told us that talks "are indeed still at an advanced stage" but there were no updates on the WRDC's part since the last time it was contacted by this paper.

The White Rocks site

The site in Baħar iċ-Ċagħaq covers an area of 450,000 square metres, which includes the complex built by the British Forces in the 1960s, and must be entirely funded by WRDC as it is not eligible for any additional funding from the EU or the government.

Development of the site was initially attempted back in 1999 by a Nationalist government but failed to gain any momentum and was put on hold. In 2010, there was an attempt to develop the site as a sports village but, again, this did not gain enough interest.

The land is also scheduled as a Natura 2000 site, and any area of archaeological and/or historical value must be given priority in terms of conservation, with high-quality landscaping necessary as part of any proposal.

The White Rocks Development Consortium

The consortium consists of London & Regional Holdings, which includes Livingstone Brothers (Richard and Ian Livingstone), with group net value assets of €5 billion; the Alpine Group, with Malta Hotels and Restaurants Association president Tony Zahra being one of its directors; Bonnici Brothers, a construction company owned by Emanuel Bonnici, John Bonnici and Mario Bonnici; Mizzi Holdings Ltd, owned by Maurice Mizzi, Brian Mizzi and Kenneth Mizzi; Michael Bianchi, who is an investor in various companies and is one of the directors of Airport Investment Ltd; Sea Estate Ltd, whose sole director is Joseph Eucharist Vella of Karkanja Ltd; Elma Ltd, whose directors are Dennis Baldacchino, who owns Tal-Magħtab Construction Ltd, and Charles Ellul, director of Elbros Construction Ltd.

A timeline of events

The following is a year-by-year timeline of the news and developments that have surrounded the site since it was put up for sale in 1999.

June 1999: The tourism ministry invites proposals for the purchase and development of the White Rocks Area.

February 2000: Three preferred bidders are named: Gasan-Siva Group, Costa San Andrea and UPA Consortium.

May 2001: Costa San Andrea's proposal is approved, with a projected completion date of June 2003.

October 2003: A permit for the €58 million project is issued by the Planning Authority. The completion date is moved to 2007.

August 2004: The government and Costa San Andrea are in disagreement over real estate issues, the contract is not signed and the government says that a new development brief will be issued.

June 2010: The government announces a €200 million project to transform the site into a sports village with 300 residential units and the promise of 800 jobs.

June 2011: Negotiations between UK Consortium White Rocks Holding Company Ltd and the government have still not concluded, with questions regarding the project being ignored by the government.

April 2012: Parliamentary Secretary Clyde Puli insists that talks with the UK consortium have "progressed substantially" amid doubts that the project will ever materialise.

November 2013: Following a change in government, Prime Minister Joseph Muscat says the proposed sports village would be relocated elsewhere and a fresh call for expressions of interest would be issued for the development of this prime site.

June 2014: The White Rocks project is reinitiated by Minister for the Economy, Investment, and Small Businesses Chris Cardona.

April 2017: The project stalls as the government and White Rocks Development Consortium disagree on the value of the land.

May 2017: During an election debate, Arnold Cassola and Simon Busuttil pledge not to develop the White Rocks area.

December 2017: The site is considered as a new location for Institute for Tourism Studies (ITS) by Konrad Mizzi.

February 2018: Adrian Delia meets White Rocks representatives and does not deny receiving financial support.

March 2018: The WRDC is quoted as being 'hopeful' that the 2014 deal would be closed within days.

August 2018: The Malta Independent reports that there has been no agreement or major updates on the White Rocks project.

January 2019: Minister Chris Cardona tells Parliament that negotiations are at an "advanced stage."


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