Jacob Borg interviews Paul Attard on his relationship with Economy Minister Silvio Schembri and with ex-prime minister Joseph Muscat
Developer Paul Attard has fended off allegations that he benefitted from a sweetheart land deal abetted by Economy Minister Silvio Schembri.
Mellieħa residents and NGOs have demanded an investigation by the National Audit Office into a transfer of government land to a company owned by Attard.
They claim the land, which is set to be developed into 109 apartments, went to Attard on the cheap.
In an interview with Times of Malta, Attard, best known for his involvement in the property development company GAP, refutes this.
Attard flatly denies ever lobbying Schembri for the land and says he will have paid over €13 million for it once the ground rent is eventually redeemed.
“The price I am paying works out at €140,000 per airspace, per apartment. People are wrong if they think that two years ago [when the contract was signed], this was cheap. I am not doing it to lose money, obviously.
“But we will make what we will make in accordance with the market rate. No one can say that this price is a bargain”.
Site long earmarked for building
Attard has owned a section of the land in question since 2008.
The developer had filed an application with the Lands Authority for the rest of the Mellieħa site, owned by the government, to be put out for tender.
Despite being outbid in the tender process, Attard’s company emerged with the land’s title thanks to a right of first refusal it held due to ownership of the adjacent land. This allowed it to match the highest bid and take over the entire plot.
Attard says there is nothing untoward with him winning the tender in this way, as the right of first refusal is a legal right that has long existed.
“There were allegations that this was the first time this right was given but, in reality, this is standard. Tenders are issued on the basis that they may be subject to the right of first refusal, thus still ensuring a competitive process.”
On the concerns voiced by Mellieħa residents, Attard acknowledged that no one likes seeing a building going up right in front of them.
He argues the site has been earmarked for potential development since 1965.
It was originally envisioned for commercial development, before the 2006 modification of the local plans saw it being changed to residential use.
“Residents knew it would be developed one day or another. I can understand no one likes developments right in front of them.
“But for people to claim it was a green lung… for a while, it was being used to dump scrap and oil. Other developments on nearby sites also took place on the basis of the local plans. Just like there other developments, we are going for four storeys and a penthouse.”
Property deals with minister
Schembri’s relationship with Attard has also come under scrutiny over the sale by GAP of a 24 square metre Luqa office as well as an apartment to the minister.
The promise of sale was signed in 2021, the same year Attard applied for the Mellieħa land.
Attard insists the two events are unrelated and the Luqa properties were sold to Schembri at market price.
“He was treated like any other person. The price was comparable to other properties sold in the same development.”
The original promise of sale, signed with the minister’s company ZF Limited, was for €180,000. The price was upped by a further €50,000 following a request by the minister for an extension in the promise of sale.
Attard says the price was increased to reflect the change in market prices between the original promise of sale in 2021 and the final contract in 2023.
“He certainly wasn’t happy with the increase… we wanted the price to reflect the current market price, as the original promise of sale had been signed two years prior. We are a public company under scrutiny, so we certainly cannot offer special prices to anyone.”
Inquiries and Joseph Muscat
Attard’s dealings with Schembri could have come under the lens of a magisterial inquiry following a request by lawyer Jason Azzopardi for the minister’s “unexplained wealth” to be investigated.
The request, and a subsequent appeal, were however shot down.
Attard says he never had anything to worry about.
“I was not the target of the inquiry request. I have no idea what happened, apart from what was reported in the media.
“It seems clear the allegations were dismissed by the authorities as being based on hearsay. It is certainly untrue that I was ever afforded any special treatment.”
A company owned by Attard features among the various big business interests that paid money to ex-prime minister Joseph Muscat following his resignation as prime minister in 2020.
Analysis of Muscat’s bank accounts, found in the Vitals hospitals inquiry, shows Attard’s Katari Holdings paid the ex-prime minister €30,000.
Muscat is facing corruption charges, which he denies, over the hospitals privatisation deal.
Attard says he engaged the ex-prime minister as a consultant to advise on a potential division of GAP’s business interest among its shareholders.
The developer said Muscat carried out two years of work on the matter, offering up his expertise as an economist on the potential impact of the division.
Attard said it was ultimately decided to see through the current projects being undertaken by GAP, while its shareholder pursues new opportunities outside of the company.