Updated adds government statement below - The Seabank Group is asking potential clients for €50,000 to reserve a floor in one of the two residential towers planned to be built on land now occupied by the tourism school, according to sources.

The land at St George’s Bay will feature two towers of 29 floors and 23 floors respectively, according to plans being shown to potential clients. The project is planned on land that still belongs to the public.

“We are offering interested parties the possibility of reserving a property against a deposit, not a bank guarantee, which is immediately refundable upon request,” Arthur Gauci, the CEO of the Seabank Group said. The 25,000 square metres of land where the Institute of Tourism Studies stands does not belong to the Seabank Group as it is public property.

The Sunday Times of Malta revealed plans for the development on a prime location by the sea in one of the most sought after areas on the island.

The two towers will be surrounded by a shopping mall on three levels, offices, a casino, a Hard Rock hotel, as well as a café on the beach.

The foreshore was never part of the ITS complex but seems to have been added to the land, according to the plans.

Seabank yesterday told this newspaper a memorandum of understanding had already been signed with the government for the development of the ITS site.

Appearing under the name City Centre, the Group was the only bidder in a call issued by Projects Malta last year for the sale of the public land at the bay.

An aerial view of the planned site for the towers at St George’s Bay. Image: MYGG Architecture

The call for the ITS site bid was open for two months over the Christmas period, which was half the time given to investors to submit bids for projects such as the White Rocks complex that attracted 11 investors. The White Rocks bid was handled by the privatisation unit and has still not been determined.

Sources expressed surprise that Projects Malta was handling the St George’s Bay bid. Projects Malta was set up to deal with public private partnerships leading sources to comment that the ITS project was beyond its remit.

The Tourism Ministry has distanced itself from the tendering process.

The Malta Developers’ Association yesterday expressed concern on the process followed for the call for offers, saying “there appear to have been shortcomings in the process for the tender call”.

Industry sources said they could not understand how the ITS sale could be considered a public-private project when the only possible public aspect, the tourism school, was being shifted out of the site at a cost of €50 million to taxpayers.

The MDA said a level playing field must be ensured on such projects. “The time allocated for the documents to be prepared and the details of the submissions given should be long enough to ensure there is a level playing field between all those interested in embarking on a project of this size,” the association said.

It appealed to the government to ensure the process was just. “The government should establish a minimum price it is prepared to accept for public land,” the MDA said, insisting the value of the land should reflect the commercial market price to safeguard the common good.

Sources close to the Office of the Prime Minister had told this newspaper the initial price offered was just €6.5 million when the potential for such a development could hike up the value of the land to anything between €80 million and €100 million.

It is understood that industry players had complained to Castille of unfair competition as a result of Seabank’s “low” offer for the site.

The Seabank Group reacted saying its offer was in excess of the figure mentioned in Sunday’s article but did not clarify the amount, saying negotiations on the price of the land were still ongoing. The company has said it was prepared to increase its offer.

The Group said the project would “inject an investment of over €300 million in the Maltese economy and create in excess of 1,300 jobs once completed”.

caroline.muscat@timesofmalta.com

GOVERNMENT EXPLAINS

In a statement this morning, the Office of the Prime Minister said that with regards to reports about City Centre accepting deposits on possible developments on the ITS site, the government was not sanctioning these actions in any manner.

It insisting that independent experts are assisting it in determining a fair value for the said site.

"A Memorandum of Understanding identifies the consortium SD Holdings Ltd, Seabank Hotel and Catering Ltd and Seaport Franchising Ltd as preferred bidder. Both parties are not bound to conclude the contract if a suitable agreement is not reached," the government said.