Issue link: https://maltatoday.uberflip.com/i/782193
maltatoday, SUNDAY, 5 FEBRUARY 2017 6 JAMES DEBONO THE relocation of the Institute for Tourism Studies to Smart City in Kalkara will cost at least €14 mil- lion more than the price tag for the St George's Bay land the govern- ment is selling to hotelier Silvio Debono. It was Prime Minister Joseph Muscat who revealed the €74 mil- lion estimate in parliament in reply to a PQ by Nationalist MP Claudio Grech back in December 2016. Debono, owner of the Seabank Hotel, had long earmarked the ITS site for the €300 million Hard Rock Hotel he wants to develop. He will pay the government €60 million for a 99-year lease on the land. His company DB San Gorg Prop- erty was awarded the land conces- sion through a request for pro- posals issued in 2016 by Projects Malta, the private-public partner- ship arm helmed by minister Kon- rad Mizzi. The government has already hinted that the new ITS school would be financed through a PPP, which means the private sector could foot part of the relocation bill. The plans for the school envision a campus that caters for 2,500 stu- dents, a 12-storey hotel with 135 rooms, gym and spa, government offices and underground car park. Set over 2,500 square metres, the new school would generate 800 daily trips into the area while pro- viding space for 400 cars and 99 motorcycles. No brief for St George's Unlike other major projects such as the Fort Cambrige develop- ment at Tigné or the Pendergar- dens construction in St Julian's, the announcement of the Hard Rock Hotel came like a bolt from the blue: the deal was inked in the absence of any development brief for the site. And it was only months since the controversial Paceville masterplan drawn up by Mott Macdonald and the Planning Authority – a collec- tion of eight high-rise projects for the entire St Julian's area – was shot down by environmentalists, residents and business commu- nity. The parliamentary secretary for planning, Deborah Schembri, has now said the Hard Rock develop- ment will still be guided by the Paceville masterplan, once the new draft is published. Until then, any construction at St George's Bay has to be regu- lated by local plan, which calls for a restrictive approach on building heights, and to conform to exist- ing heights – with the exception of the Portomaso tower, "which will not be used to determine future heights". So development in this area must be "strictly limited" to hotel use and ancillary facilities. As things stand, a revision of this local plan has not yet been completed, show- ing just how much these planning rules are in a fluid state. Thursday's announcement com- mits government to a price tag on the sale of the land. What is unclear is how this tal- lies with work on the Paceville masterplan. In June 2016, tourism minister Edward Zammit Lewis told parliament no project would be approved until the masterplan is completed. But planning secretary Deborah Schembri said the fact that the masterplan is still being drafted, no other projects should be kept on hold. Arguably, Silvio Debono and his franchise partners must have got antsy about the slow pace of the masterplan after the public outrage that was raised. Prime Minister Joseph Muscat also suggested that the price tag can be increased, if the masterplan allows more development than that envisioned when the ITS site was valued by Deloitte. €429 per sqm for prime land So DB San Gorg will pay addi- tional fees to the government if their project is granted more room to build, once the Paceville master- plan is completed. Joseph Muscat described the €300 million project as a first, mak- ing special mention of Deloitte's methodology in appraising the value of the land, and which will be used for all future land sales. But herein lies the rub: in the Paceville masterplan, a large tract of the ITS site was included as part of a 15,000 square metre area on the upper part of St George's Bay, tagged as a public open space. Ex- propriating this seafront land was valued at €128 million in the mas- terplan, or €8,500 per square metre as according to "prices provided by the Malta government". At that same rate, the entire ITS land would have resulted in a €212 million price, but that rate would not have accounted for the differ- ent values that are determined by permitted use. Debono's Hard Rock Hotel comes with 315 rooms and an- other 209 apartments and a 20,000 square metre shopping mall. This total floor-space of 140,000 square metres is being offered at an aver- age €429 per square metre. When compared with the prime land offered for the development of Tigné's Fort Cambridge in 2007, which yielded 341 apartments over 70,000 square metres, the land went for €54 million or €771 per square metre. That money was paid cash-on-contract. Debono's group will pay €5 million on sign- ing the deed, and then €10 million over seven instalments. The shortcoming at Tigné was that the Fort Cambridge brief nev- er limited heights, which is why developers Gap Holdings want the green light for an unprecedented, 40-storey tower hotel atop the historic British barracks. Will it be obliged to pay more for the in- crease in floor-space is approved? No. Historical and geological concerns Beneath the sheen of the Hard Rock's futuristic design, lies the reality of the historical ITS build- ing itself: a Grade 2, army barracks with the Victorian Royal Arms and those of Lieutenant-General Sir John Gaspard Le Marchant (1803- 1874), governor of Malta, sculpted in the franka stone on top of the building. Grade 2 buildings cannot be de- molished, but internal alterations and changes are allowed, and new development next to such build- ings is not precluded. Debono's hotel group have said about the ITS building that it be "carefully protected, appropriately restored and integrated within the new de- velopment scheme and use". But it is not clear how this inte- gration will take place. And in a document the developers present- ed in January to the PA, they refer to works envisaging the "careful" dismantling of the building and the "identification and logging of each piece." Of serious concern is the fact that a protected cave, known as Ghar Harq il-Hammiem, is lo- cated partly beneath neighbouring Moynihan House (across the road from the ITS building). A buffer zone intended to protect the cave includes part of the ITS. The cave is the only known fully submerged, terrestrial cavern in the Maltese islands. Residents include the rare albino shrimp. But it is unlikely that this crustacean will be of any trouble to planners and develop- ers. jdebono@mediatoday.com.mt News ITS land goes for less than €74 million relocation Deloitte's €429 per square metre is far less than the masterplan's original €8,500 expropriation price How it will look: Silvio Debono's €300 million Hard Rock Hotel and residence