Ground rent for 'American university' 50 times higher than that of Smart City - PM

Ground rent for 'American university' 50 times higher than that of Smart City - PM

Prime Minister Joseph Muscat this morning defended the ground rent which the government will charge for the two sites which will be used by the 'American University of Malta' saying it is 50 times higher than what the former government imposed for Smart City.

Details emerged yesterday of how the Jordanian-owned Sadeen Group will lease public land for 99 years to develop a university in Marsascala and Cospicua.

Sadeen Education Investment will pay a ground rent that starts at €40,000 in the first year, increasing gradually every year for the duration of the lease agreement.

Sadeen’s title will be of a temporary nature and may not be converted to a perpetual emphyteusis. The company will be granted free and vacant possession over the designated land.

The company, owned by construction magnate Hani Hasan Naji Salah, will be bound to make an initial investment of €104 million and have both campuses running to full capacity after six years.

The company will not pay a premium for the land.

Sadeen is contractually bound to generate 300 direct jobs and engage around 4,000 students when operating at full capacity.

The contract for the transfer of land to Sadeen was released yesterday by the government after it was discussed at a meeting of Parliament’s National Audit Committee.

Opposition members on the committee cried foul since the contract was only given to them at 8pm on Wednesday, giving them little time to carry out an in-depth analysis of the 41-page document.

‘University will only proceed if Commission grants licence’

Committee chairman, Deputy Prime Minister Louis Grech said the contract would be discussed again in the committee on Monday and possibly Tuesday. It will then be taken up in the plenary by Wednesday, the last day Parliament meets before it rises for the Christmas recess.

The government wants the contract to be debated and approved by Parliament before the Christmas holidays. Education Minister Evarist Bartolo insisted the land transfer was one aspect of a long process and there was no reason to postpone it further. The Opposition has questioned the rush.

Fielding questions about Sadeen’s educational credentials and its pending accreditation process, Mr Bartolo insisted the university project would only go ahead if the National Commission for Higher Education granted a licence.

The contract stipulates that Sadeen must obtain and maintain a licence to operate a university, failing which the contract will be deemed to be null.

The contract also binds Sadeen to use the land for educational purposes.

The land transfer contract obliges Sadeen to submit planning applications within 45 days of signing, raising questions as to the logic of initiating this process when it still did not have a licence to operate as a university.

Lawyer Alex Sciberras, who formed part of the government negotiating team, said the risk lay with the investor.

The American University of Malta is expected to take in its first students in October next year – subject to having all required permits and authorisations in hand.

Temporary operations, in the form of a foundation course, could be provided from Smart City if the Cospicua site is not ready, Mr Bartolo said.

The land to be transferred comprises 31,000 square metres at Żonqor Point in Marsascala, 18,000 square metres of which are outside the development zone. The rest of the campus will cover the area currently occupied by the former national pool.

A belt of land touching the campus perimeter along the foreshore, covering 10,000 square metres, will be landscaped by Sadeen but kept free from development and left fully accessible to the public.

Dr Sciberras said this tract of land did not form part of the land transfer but Sadeen was obliged to maintain it and the government was bound not to transfer it to anybody else.

The Cospicua campus covers more than 13,000 square metres and includes various historic buildings along Dock 1, a car park in Triq il-Karmnu and an underground area joining the car park and the buildings.

Sadeen will be contractually bound to maintain the foreshore along Dock 1 but Dr Sciberras insisted this had to remain accessible to the public at all times.

Any changes to the conditions in the contract would require parliamentary approval, he added.

Project numbers

1 to 3:The percentage of scholarships for every annual intake Sadeen will make available to the government.
5: The minimum number of colleges the university will have.
5: The years Sadeen will enjoy exclusivity on the brand name American University.
6: Sadeen has six years to complete the project.
300: The number of direct jobs the university is expected to create.
4,000: The number of students at full capacity.
€104m: The money (€) Sadeen is expected to invest in the project.

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