Air Malta has not put a price tag on the Selmun Palace Hotel and the majestic castle that adjoins it as it opens its arms to offers from local and foreign investors.
Two previous bids in 2009 and 2010, which had attracted the highest offer of nearly €9 million, had been refused because they either did not meet the government’s expectations or did not meet tender conditions.
Although the airline has its expectations based on a professional valuation, chief executive Peter Davies and head of restructuring Ray Hart are keeping their cards very close to the their chests.
They still refused to divulge what they were expecting in return for the property but rather focused on its potential.
And in order to exploit its full potential and sell it to prospective bidders, the airline sought the expertise of CBRE Hotels, a leading international group which provides sales advisory services to manage the marketing and sale of the property.
Mr Hart explained that CBRE prepared a detailed marketing plan featuring different scenarios for the property and the palace. It can be used as a three-, four- or five-star hotel or even a wedding venue.
“This property has great potential and flexibility. The detailed marketing plan will showcase this.
“Previous calls did not market it properly so this time we are focusing all the efforts on the marketing campaign, which has already started locally and internationally,” he said.
The hotel is owned by Selmun Palace Hotel Company Ltd, a fully owned subsidiary of Air Malta, which is seeking to sell non-core operations and focus solely on the airline business.
Mr Hart and Mr Davies explained how the airline chose CBRE Hotels. The process began in January 2011 when the firm let go of 58 employees “who had nothing to do”.
“We could not treat people like that, letting them sit there with nothing to do, so we released them to go look for another job,” they said.
They contacted the developers who had expressed interest in the previous two calls but not all were still interested in the property.
Mr Hart said the valuation took into consideration the various uses the property could have.
When asked, he said selling efforts were focusing on both the company and the hotel itself.
For some investors, the company, with its accumulated losses of €13 million and a debt level of close to €3 million, could be valuable.
The majestic Selmun Castle, originally built by the Knights of St John in 1783, is being offered on a temporary emphyteusis for a period of 64 years against a ground rent of €70,000 a year.
It houses some of the hotel suites as well as being a venue for weddings and functions.