The Sliema Chalet and two lido sites in Qawra have been removed from the public domain in a parliamentary vote on Wednesday.
The sites will be leased to private entities for commercial development on condition that residents and the public will still have access to the coast.
The vote was taken during parliament's environmental standing committee after months of testimonies from public officials, discussion, deliberation and objections from environmental NGOs.
Government MPs Deo Debattista, Omar Farrugia and Romilda Zarb voted in favour of the declassification and PN MPs Janice Chetcuti and Stanley Zammit voted against.
Chetcuti and Zammit said they agreed with the declassification exercise in principle but wanted to see more detailed plans for the Sliema Chalet before voting in favour, because it looked like the entire peninsula was being given to private investors without a clear guarantee of a public pathway.
They said they feared that if they signed off on the sites now, it would be far more difficult to stop development that was not in the public interest in the future.
"We have no objection to the Qawra plans. We have seen them, we like them, and frankly, we think they will improve the area," Zammit said.
"As for the Chalet, we are still not convinced that the rehabilitation will definitely respect residents', swimmers' and the public's rights."
The three Labour MPs dismissed the PN's concerns, saying the MPs in this committee are only tasked with voting on whether they agree with the declassification in principle.
They said that the detailed plans for the commercial developments will be analysed and scrutinised in great detail in the future by other public entities that are more competent.
At this stage, all they needed to do was to sign off on the declassification.
Committee chair and medical doctor Deo Debattista attempted to appeal to the PN MPs with a medical metaphor. He said it was their job to set the ball rolling on the much-needed development of the three sites and likened the decision to giving birth to a baby.
"We need to give birth to this baby. It might be scary, but we need to give birth to the idea, and then let other, more competent public entities take care of its upbringing," he said.
"This baby has to be born one way or another."
Last year, Times of Malta reported that the Planning Authority ran a public consultation on whether the site of the Chalet in Sliema and two pieces of land along the Qawra coastline should be removed from the public domain, even as requests to transfer several other sites into the public domain, for the enjoyment of all, remain in limbo.
A few weeks earlier the government had published a call for proposals for the Sliema Chalet that asked prospective bidders to take on a 65-year lease with a minimum capital investment of €3.2 million.
The other two sites lie close to each other on the Qawra seafront and are occupied by private lidos owned by Anġlu Xuereb's hospitality business.
Anġlu Xuereb occupying Qawra sites 'illegally'
While testifying during the previous hearing of the environment committee last week, Lands Authority CEO Robert Vella confirmed that Anġlu Xuereb has been occupying the land in Qawra illegally for decades.
Despite having developed and run the sites with the necessary planning permits, Xuereb has no legal title to the land, Vella told the committee, and the Lands Authority has been fighting a 30-year legal battle that is still yet to be decided.
After the declassification exercise, the Lands Authority will reach an out-of-court settlement to get financial compensation from Xuereb for illegally occupying the sites, Vella said.