Tuesday, 6th January 2009 - 13:24CET
Midi's bond issue 'not a panic button' - chairman
Midi’s bond issue was not a panic button requesting funds but part of a larger financial plan which includes international sales and rents and banking facilities, Midi plc chairman Albert Mizzi said this morning
Midi, the developers of the Tigne Point and Manoel Island projects, on Friday offered the equivalent of €30,000,000 in seven percent bonds denominated in euro and sterling.
Chief executive Ben Muscat pointed out during a press tour that the €450 million development was not just apartments but the regeneration of two prime sites, including major structural and regeneration works. Fort Tigné and Fort Manoel were being restored as part of the project.
He said the development of Tigné was half way through and once regenerated, Tigné Fort would be the only historic attraction of its kind in Sliema.
The development at Tigné, he said, included a piazza, which would attract commercial interest, and the whole complex will be an open zone for pedestrians.
It was estimated that to complete, another €199.6 million were required. The bond issue would provide €23.73 million of that figure.
Mr Muscat said that Midi had already sold 235 apartments of the 260 launched so far since 2002. 30 percent of buyers, representing more than €50 million of sales to date, were foreigners.
These bonds are of a nominal value of €100 and £100 per bond and mature in 2016 - 2018. They are being issued at par. If the bond issue is over-subscribed, MIDI p.l.c. may issue an additional €10,000,000.
Tigné Point is to include 420 homes, 16,000 sqm of offices, an international-standard retail mall, a 2,500 sqm public square, cafes and restaurants, a clubhouse, sports facilities and a newly-built football pitch to replace the original one operated by Sliema Wanderers.
The proposed development at Manoel Island is limited to some 30 per cent of the islet’s surface area and will include low-rise Mediterranean-style residences, a car-free zone, landscaped gardens and a sheltered yacht marina.
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Comments
You almost hit the nail on the head.
The objection is when the initial plans call for 'x' floors and then when it is a fait accompli the floors become 'x + y'.
I would build 12 and15 storey's as they will be doing at Tigne Midi,(you can't see them in the photo above,they haven't been built yet),or else i would be building 23/26 storeys as at Fort Cambridge or perhaps 30 odd floors as proposed at Town Plaza/Place Knowing that only money matters, I would have no problem in getting a permit.
Oh before you ask,I have been inside.That's why I feel free to comment.
if you call this a ghetto you have obviously never been inside. Do you think people pay LM300,000 - 500,000 for a flat at Tigne and Portomaso (that other 'concrete jungle') because they don't like it or they think its a ghetto ? Ask any agent who will tell you that they are practically all sold. And before you say 'its because of the view' let me remind you that down the road at sliema and gzira there is also an almost identical view of valletta yet apartments there go for half and one third of these prices. If you were a developer and had a permit to build 8 floors on your plot of land would you build 3 ? yeah,. right..
Nobody is keeping you from investing all your life savings in these bonds. Put your money where your mouth is. You could even borrow at 4.5% and invest at 7% with MIDI!! Now that is an opportunity of a lifetime, money for jam.
Envy does not come into it. Most of the purchases were made for speculative reasons and not for residence purposes. It worked with Portomaso but the situation is now very different. The "me too" syndrome has a habit of biting back. Too much of a good thing is bad for you.
And what do you mean by introducing Catholicism into the equation? Should Catholics accept everything that is thrown at them?
On a positive note I have to agree with you about the quality of the product churned out of Uni. Students go there for programming not for learning to think. Not only that, but if they dare to think they are in trouble! Well perhaps not such a positive note, but there you are.
With regard to unsecured bonds issued, not just here, at this time..yes ..it's an unacceptable risk. Perhaps it's a good thing you don't have the funds to spare.
If one cannot afford a property at Tigne Point ........... rubbish them.
If one cannot afford securities issued by MIDI ...........rubbish them.
Some people were disappointed that none of the local banks were in trouble during banking crisis and came through unscathed ; some even did their best to tip the balance with rumours - these are the Maltese who profess that they are 100% Catholic !
Instead of reading serious newspapers and viewing overseas qualityTV to arrive at an informed opinion , these chattering classes indulge in teleshopping and telenovelas 24/7. You can hear their profound pronouncements on TV phone-ins invariably starting with "Isma, hi, prosit tal programm......", vox pops.
Do not be illuded by the large number of students at Uni , they all book gobblers and are unable to put two words together to write a short letter without howlers.
I have strayed off the MIDI issue but the chattering classes are all followers of the green monster ,ready to pounce on their victim to tear him to pieces with their chattering tongues and clattering keyboards.
Dear namesake of mine, nobody is against projects which create jobs and wealth.But not at any price. The skyline has been ruined for ever. The architecture is hideous. The view might be beautiful from the Sliema side but it looks like a pile of gabjetti from Valletta.
The photo says it all.
How come the Gzira United football pitch isn't mentioned in the list of works scheduled for Manoel Island?
The proposed football pitch should start taking shape in July, and should be ready by August 2010.
Any comments on this????
I rest my case.
"Security lies in the fact that the companies asset values far outweigh its debts."
The question is whether those assets can be realistically liquidated in the present economic climate. For example, a number of car manufacturers have vast stock of cars which they cannot sell. The same applies to property.
the vast majority of corporate bonds are unsecured - both locally and overseas. The only issuerers who secure their bonds are generally those who have to, because the company and its assets are generally unknown entities. Examples of local unsecured bonds include Corinthia, United group , Mizzi Organisation, Hsbc, Bov, Crimson Wing, Gasan, Tumas, Farsons etc etc . Security lies in the fact that the companies asset values far outweigh its debts. The prospectus on this one should put your mind at rest - if you are interested to find out the facts that is.
Well, thanks to all the people you've just mentioned, many other people are allowed to do much less than they are able to, because, amazingly, some projects never take off the ground unless these people have their finger in the pie.
This is not political - it happens everywhere and everytime. While not doubting the capabilities of the people mentioned, we do know that some of them have had particular boosts under one govt or another.
Notwithstanding my total disagreement with the MIDI projects, I sincerely wish them success for the benefit of the whole of Malta.
I've read the article, however unlike you I've also read between the lines. when management bring up the possibility of entering administration it is simply a way of easing the news and preparing stock holders for the inevitable shock.
I hardly expect that they would announce this 'just in case'.
All the negative people below sound like people who never did anything themselves and they eagerly wait for others to do a mistake so they can tell them, I told you so. Thanks to people like MR MIZZI thousands of people are employed on this island (thousands working with his companies ). Thank god for people like Caqnu , Zaren Vassallo , etc etc. If it was not for the initiative of business minded people like them we would all be civil servants or farmers.
Thank god the world is not only made up of losers waiting for others to make mistakes but there are also those with a brain and they like to use it.
Re your experts in the field, stockbrokers, the world is full of economists, experts in their field, yet most, if not all countries economies are in deep s**t.
If you are so happy with the offer there is nothing to stop you from putting all your savings in these bonds.
Or are you afraid because they are all UNSECURED?
suggest you reread the article that you yourself posted. debenhams are not in administration, the other two retailers mentioned are.
@ sarah zammit
you hit the nail on the head. In malta we are obsessed with negativity. Someone issues a bond then they must be in trouble... if that was the case then malta govt, hsbc and bov must really be in deep trouble, if a project is doing well then all its buyers must be speculators and all the sales will fall through, even when someone gets a promotion we say he must have an angel involved to help him and if its a she then she must have done many other things too ! Small island mentality - so much for the eu.
I smell trouble. 7% in this market is simply too good to be true.
Are Midi going downhill like so many Irish developers have done in recent times ????
http://www.timesofmalta.com/business/view/20090101/features/stock-market-review-midis-30-million-7-bond-issue
Where were you when I was arguing the same exact thing a few days ago! hehe
I think greed has caused MIDI to shoot themselves in the foot.They should have stuck to the original plans and not attempt to build a ghetto.
I hope the Government does not have any wild ideas about selling the lease to MIDI now or in the future as they did with Portomaso.
Wow! Free entertainment?
" there is an acceptance among directors that existing levels of debt are unsustainable"
http://www.ft.com/cms/s/0/ac5c76ca-d5ec-11dd-a9cc-000077b07658.html?nclick_check=1
And just one other note, with interest so low at the moment, why not borrow money from local banks.? Surely some of the the MIDI Board of Directors (BOV, HSBC & Lombard) would have loved to lend this amount to them.?
you have obviously never been into the place. You can look into other flats no more than you can look into the house accross the street in the town where you live - except for the fact that where you live there are cars parked outside your door and buses and vans in the street. If you want to buy a detached villa in the middle of nowhere nobody is stopping you but as far as apartments go these are about as good as you can get in malta. I should know , i live here.
Adding insult to injury, the central Government seems to be hell bent to construct the controversial new Ghadira road, instead developing the necesary infrastructure to mitigate the Sliema precarious traffic problems, despite having earned millions of Liri from the sales of Tigne Point and the Holiday Inn.
Prospective buyers of these bonds should seek professional and independent financial advice before taking the step.
As they say, all investments carry risk, and past performance does not guarantee or indicate future results