The Fortina Group insisted it was paying well over market price per square metre of buildable area for an area it owns and which is slated for development in Tigné.
The Lands Authority’s valuation of €8.1 million for the removal of restrictions for a “small landlocked” portion of the land was excessive, the hotel owners said in a statement.
The circa 1,250sqm plot which was sold to the Fortina owners in the 1990s will be developed into a newly refurbished 5-star hotel and associated amenities after getting the green light from the authority.
At the time they were only allowed to develop it for tourism-related purposes and are now seeking Parliament’s approval for the contract that would permit them to also construct an office block, apartments and a retail area.
“We based our view on a valuation carried out by one of the ‘Big Four’ audit and accountancy firms, which revealed that the fair market price of this portion of land is far lower than what was quoted to us by the authority,” Fortina Group said.
“However, we agreed to pay the sum, despite much more favourable arrangements approved by Parliament in the past,” a spokesman said.
“This means we will be paying well over market price per square metre of buildable area, in which we must then invest millions to develop and finish. We obviously seek to make a return to reflect the risk and effort we are undertaking, but that is, after all, the very nature of any commercial enterprise which contributes to Malta’s economy.”
Fortina Group made it clear that the land over which it sought to lift a restriction on commercial and residential development has been fully owned by the group for almost 30 years.
“Crucially, this plot is landlocked, which means it does not benefit from sea views and is only accessible through the Fortina development,” the spokesman said, adding that therefore, the valuations obtained by the journalist from estate agents are inappropriate in this context and “way off the mark”.
It added that 85 per cent of its site will be occupied by a newly refurbished 5-star hotel and associated facilities that will contribute to an upgrade in Malta’s tourism product.