City Centre project: come and see the contract, db Group boss invites Simon Busuttil

Following MP Simon Busuttil’s declaration in Parliament on Monday that the transfer of the ITS site to the db Group needs to be investigated, db Group CEO Author Gauci yesterday re-extended his invitation made a few weeks ago to all politicians and journalists to look into the contract in question with the Group’s full cooperation.

“But so far no one has taken up our invitation, including Dr Simon Busuttil. As always, we have nothing to hide and nothing to fear,” Gauci said in a statement yesterday.

He also challenged Busuttil to produce any evidence he might have in connection with the transfer of the ITS land in Pembroke to the group.

In a statement, the group said, “We categorically deny that we are aware of, let alone being party to, any wrong-doing. In fact, for the first time in Maltese history, in our case the market value of the land was set by an auditing firm of global stature, namely Deloitte, a price that the latter’s partner certified under oath as ‘fair’ in open court.

“We therefore welcome any type of national investigation into our contract and pledge full cooperation with those who would conduct it. Indeed, we invite Simon Busuttil to pass on to a prospective inquiring magistrate or the police any information which he might have.”

From the start, the db Group said it has welcomed the scrutiny of the ITS land transfer by both local as well as European institutions. In fact, our Group had publicly embraced, and still does, the review of the transfer by the National Audit Office.

“Equally, we warmly welcomed the EU Competition Commissioner, Margrethe Vestager’s confirmation that the Request for Proposals (RFP) procedure followed for the land transfer was in conformity with EU rules.”

At the end of October, Gauci had said he “gladly welcomes” the European Commission’s statements on the project and submitted 10 facts about the contentious City Centre Project “to conclusively demonstrate that this EU criterion was completely fulfilled”.

Gauci said that the db Group had noted the position taken by EU Competition Commissioner Margrethe Vestager on the transfer of the public land in St Julian’s for the building of the City Centre project.

He also noted that the Commissioner had added: “What ultimately matters is whether the public authority acted in its capacity as a private seller in concluding the transaction and that the land was sold to the buyer at market price.”

Welcoming the statement, Gauci provided 10 facts “to conclusively demonstrate that this EU criterion was completely fulfilled”.

For the first time in Maltese history, the market value of public land has been set by an auditing firm of global reputation, namely Deloitte.

Using the formula established by Deloitte, the db Group will be paying a total of €60 million for the land in question, the highest price ever paid per square metre for a comparable project in the last 20 years. This remains the case even when the increase in the price index is factored in.

Under oath in court on 7 May 2018, a Deloitte partner declared that they had met with various promoters of similar projects in St Julian’s “to understand exactly the market in the area”. Following these meetings, and keeping the requirements of the RFP in view, he reconfirmed under oath that €60 million was in fact the market value of the City Centre site.

The Deloitte partner also testified that, to support its work, the firm had engaged the architectural services of various architects, amongst them Prof. Alex Torpiano.

The public call for submissions for the project was in full conformity throughout with all applicable local and EU laws.

The db Group will be investing €300 million in the project.

This amount makes it the largest private investment by an individual in the history of Malta.

In total, the City Centre project will generate around €490 million of direct revenue to the government over a 10 year period.

The project includes the creation of an underground car park for 1,700 vehicles.

Once the project is completed, the contract obliges the db Group to create 1,500 jobs. If not, the Group will have to pay a penalty. This is apart from the work and jobs created during the construction phase.