Malta International Airport plc yesterday unveiled the plans for a €16 million business centre adjacent to the Gudja terminal, where Vodafone Malta will be the anchor tenant.
The nine-storey centre, located next to the McDonalds restaurant, will occupy a footprint of 3,100 square metres with a total rentable area of 14,000 square metres. Five floors will be dedicated to office space, and two to underground parking. Other floors are earmarked for food and beverage and retail concerns. The centre will be able to accommodate around 1,000 employees in its final guise.
Under an agreement signed on Tuesday, Vodafone Malta will occupy 2,500 square metres within the centre and 600 square metres of terrace area on the top floor. The company is to move out of its headquarters in Valley Road, Birkirkara, which it has occupied since inception 20 years ago, in the third quarter of 2011.
Applications for planning permission have been filed and MIA expects construction to be completed within 18 to 20 months after the permit is granted. The target completion date is mid- to end 2011.
MIA plc chief executive officer Julian Jaeger pointed out that the premises' attributes included excellent accessibility, vicinity to the terminal, ample parking facilities, a highly visible frontage, flexible office space, and energy-efficiency.
The centre, of which MIA plc is owner, investor and project manager, has been designed by Edwin Mintoff.
The project falls under MIA plc's strategy to diversify revenue generation sources which aimed to be increasingly independent from airside operations.
"Our aim was to generate around 30 per cent of revenue from non-aviation operations by around 2010," Mr Jaeger told The Times Business. "The centre will not be able to contribute to that by then but this it is a huge step in that direction."
Asked whether the current economic climate presented favourable conditions for investment, Mr Jaeger said MIA plc believed this was the right time to proceed.
"The cost of raw materials is attractive and construction costs should be lower now," he pointed out. "I would not have recommended to the board to go ahead with the project without an anchor tenant, but we are proud to have signed an agreement with our first clients without even a stone being laid.
"High quality office space is still lacking at the moment but more will come on the market in the next few years. That is also why we are forging ahead with this project now, rather than risk missing the boat."
Mr Jaeger said the project will be marketed in Malta and overseas. The marketing strategy was being finalised for launch in the autumn. He said interest in the centre, which had become somewhat of an open secret among the business community in recent months, had been growing.
Vodafone Malta chief executive officer Inaki Berroeta, who Mr Jaeger joked will enjoy the best view of all from his new office, said the two companies started discussions on ways to collaborate a few months ago. The mobile company was looking to start another 20 years of operation from this "ideal location", he said.
Mr Berroeta told The Times Business that the move was part of Vodafone Malta's ambitious growth strategy and fell under plans for further investment which will see significant developments over the next few years.
The MIA business centre offered better facilities than the Birkirkara block which had become old and a little inconvenient. The open plan office space at the new centre would enable staff to be more dynamic and efficient.
Asked how the investment fell under Vodafone Group's £1 billion worldwide cost-cutting drive, Mr Berroeta insisted that cutting costs did not mean that investment had to be stunted.
"This move is also about cutting costs," he pointed out. "Cost-cutting is about increasing efficiency, wasting less, and making better use of funds."
By referring to Vodafone Malta's long-term operations, Mr Berroeta put paid to rumours about the company's intentions in Malta which have been doing the rounds in recent weeks.
"Vodafone is an operator. Its business is to run telecom companies," Mr Berroeta said. "It is not a portfolio manager, it is not in the business of buying and selling concerns, it is not involved in equity. We are still the number one mobile provider on the island, our telephony offering is doing well and we are launching total communication needs as regards our internet products.
"Our broadband offering is holding its own in the market. We are very well regarded as far as our mobile and fixed telephony services are concerned. Our numbers are as expected."