Issue link: https://maltatoday.uberflip.com/i/717204
maltatoday, SUNDAY, 21 AUGUST 2016 News 3 JURGEN BALZAN THE Planning Authority has issued enforcement notices to construc- tion developers JPM Brothers, the owners of the former Jerma Palace Hotel and the Mistra Village com- plex, ordering them to clear out the abandoned hotels. The notices follow recent calls by the Marsaskala local council for the derelict Jerma Palace to be pulled down, warning that the building poses a public health hazard. Last year, Prime Minister Joseph Muscat had made a similar plea, calling on the owners – Jeffrey and Peter Montebello – "to get their act together," urging them to rehabili- tate the site. In May 2015, MaltaToday report- ed that Peter and Geoffrey Mon- tebello, were seeking to redevelop the former hotel site but their plans were hampered by a precautionary warrant in court requested by an accountant to stop the sale of the Jerma Palace Hotel and the sur- rounding land. In a statement issued yesterday, the Planning Authority (PA) said: "These two large sites, in prominent locations, have both been left aban- doned and in disarray for years and have become an injury to amenity. "Through the enforcement notice, the PA has requested the land own- ers to address the injury to amenity that is resulting from the abandoned state of the structures on site." The Montebellos' plans to rede- velop the former Jerma Hotel into a complex of apartments, a five-star hotel and a yacht marina have been hampered by the accountant's de- mands for €3.5 million in outstand- ing claims for his services to the brothers. The accountant, Charles Sciriha, filed the claim against JefPet Lim- ited, a company owned by Geof- frey and Peter Montebello, who purchased the Jerma Palace Hotel in 2007 from Libyan investment ve- hicle Lafico. The land on which the Jerma Pal- ace Hotel was built originally be- longed to the Franciscan Conventu- als and Ivan Burridge, and was sold to San Tumas Holdings, which in turn sold it to the Libyan Lafico in 1976. The Corinthia brand used to manage the hotel under a manage- ment agreement. The hotel was never developed after it closed down in the 2000s and then sold to JPM Brothers. At some point in 2009, the Tumas and Gasan groups were seeking advice on transforming the Jerma Palace Hotel into a potential 'Portomaso of the south', when JPM Brothers were hoping for an urgent sale of the property to settle outstanding loans with banks and creditors. But the plan never materialised: a MEPA policy undertaken by for- mer chairman Austin Walker was that hotel development should not be turned into residential develop- ment, but kept as tourist accom- modation and hotels. Joe Gasan had then told MaltaToday that he was only consulted on the proposal. "All I know is that I was asked for my opinion but after I looked into the Jerma proposal I backed out be- cause I didn't like the fact that the Montebello brothers were pressur- ing to hurry up the deal. They were asking for just a few weeks to con- clude." Sciriha claims the amount he is asking for represents outstanding fees for consultancy services and representation for the Montebellos in various negotiations, including the sale of the land previously occu- pied by the Jerma Palace Hotel. Sciriha was engaged in 2009 on a consultancy, entitling him to a percentage of the sale proceeds and profits if two projects the JPM Brothers had undertaken with Ku- waiti company Gemxija Crown Limited, went ahead. Mistra project falls through Gemxija and JPM Bros owned the land in Xemxija where the former Mistra Village complex is situated. The PA had in 2013 approved plans to develop the former Mis- tra village hotel in Xemxija into a high-rise luxury apartments pro- ject. However, despite the permit is valid for five years, the plans were shelved earlier this year due to a lack of funding and interest from foreign investors. The lack of funds thwarted plans by the Kuwaiti firm to build a 12-storey mega-project with more than 700 luxury apartments at the former Mistra village site. Reportedly, Gemxija Crown Ltd, the joint venture between Kuwaiti and Maltese investors, dropped the plans because the necessary financ- ing was not tapped. The PA gave the controversial de- velopment the green light in 2013 after a long process. In 2008 it had already issued an outline develop- ment permit. After a €42.2 million Bawag Bank loan had to be called in on default by JPM Brothers, Kuwaiti property magnates Massaleh stepped in to push the project forward. The Montebellos are not new to controversy: at one time it was re- vealed that they were donors for the political campaign of former fi- nance Minister Tonio Fenech who was allegedly asked to intervene in the difficult sale of the derelict Jerma Hotel. Fenech's private secretary, Noel Borg Hedley, admitted to receiv- ing bribes from the contractors in 2008, when he was a member of Fenech's secretariat. In 2012 he confirmed in court that he received "tips" from con- tractors Jeffrey and Peter Monte- bello, who allegedly rewarded him for intervening with the Tax De- partment to waive fines they owed on the sale of under-declared prop- erties. Fenech categorically denied any knowledge of or connection with the case and was not prosecuted. The case, however, was thorny for the former minister, not least because the contractors are the same ones he had hired to carry out renovation works at his house in Balzan. Montebellos slapped with enforcement notices over derelict Jerma and Mistra sites The former Jerma Palace hotel today lies in ruins The 12-storey mega-project in Mistra was dropped because the necessary funding was not tapped and foreign partners lost interest