Corporate village, the iconic €200 million project planned for Mrieħel, “makes sense to any investor” as it offers highly advantageous returns on investment, Malta Enterprise executive chairman Alan Camilleri told The Times Business.
“The return on investment and annual percentage rate figures are good,” Mr Camilleri said. “Commercially, the project makes sense to any investor, at a total investment of €200 million, with government occupying 30 per cent of the project, at the current – and fairly stable – rate of rent in that area.”
According to a study conducted by Deloitte and Touche, the project boasted an average return on investment of seven per cent at current market rates. Mr Camilleri added that the longer the lease period, the more the returns appreciated.
Corporate Village is intended to become Malta’s central business district with office, leisure, retail, sports and conference facilities occupying around 130,000 square metres of space. Malta Enterprise, which is currently spearheading the marketing campaign and working to raise investor interest, is to make Corporate Village its new home, alongside the VAT and Inland Revenue Departments, among others.
It is also earmarked as one of the main hubs of activity at Malta’s EU Presidency in 2017 as it will host presidency summits and events during the six-month shared tenure.
Work on Corporate Village is expected to kick off in 2012 and be completed by 2015.
The deadline for submissions of expressions of interest for the design, development, operation and marketing of Corporate Village has been extended to October 29.
Malta Enterprise said last month, the deadline, originally set for early September, had been extended after prospective investors asked for more time to evaluate the project.
“If the market wants Corporate Village, the market will make Corporate Village. We are not proposing a project in which we are putting our money. This is a concept. Never in Malta had there been a project of which 33 per cent was sold on a long-term basis to a tenant that is there to stay,” Mr Camilleri said, alluding to the government agencies and departments.
“Corporate Village is not about real estate. It is about giving shape and form to public services, especially those that have to do with businesses. With Malta Enterprise and the VAT and Inland Revenue Departments all housed there, there will be an immense footfall of people and an immense amount of transactions and operational efficiency which can be delivered through a project like this. Corporate Village also redefines the whole district. There is a central business district in most countries. This will be ours.”
The project has already been showcased in London where Mr Camilleri and Malta’s High Commissioner to the UK, Joe Zammit Tabona, a former Malta Enterprise chairman, hosted a business breakfast for key international business personalities.
Mr Camilleri said Corporate village was being marketed to a range of institutions, including pension fund managers, investment banks, property developers, facility managers, large project management companies, and sovereign fund managers.
“No one of these can do it on its own,” Mr Camilleri explained. “It would be ideal to have a mix. We created the idea and the product, now it is the market which has to play its part.”
He added that the development, earmarked for the site formerly occupied by the Dowty plant, will contribute to uplifting the fledgling business district even further.
Mr Camilleri refuted suggestions that dedicated business blocks were in adequate supply or that the aims of Corporate Village would overlap those of other developments.
“First of all, there are a number of planned business blocks around the island which have not been built yet,” Mr Camilleri stressed.
“Also, every niche has its own requirements. Igaming companies generally prefer to be based in Sliema or St Julians, ICT firms will target Smart City because it is the project designed for that market. We envisage Corporate Village as a home for back office operations, the shared services we are promoting and the legal and fiduciary services, the ones that link and are secondary to financial services, for example.
“Or it might itself evolve into a financial city. It is not in competition with other sectors; these are offices which are required. At the moment, finding 3,000 square metres of free office space is hugely problematic.”