PM warned of legal battle over Evans Building privatisation process

Prime Minister Robert Abela has been warned to handle the ongoing privatisation process of Evans Building in lower Valletta with care or face a long-drawn and embarrassing legal battle over the process.

Sources close to the delicate process to hand over the iconic Evans Building to the private sector for the next 65 years for conversion into a state-of-the-art 5-star luxury hotel, told The Shift that Prime Minister Robert Abela has been personally informed that some of the bidders are unhappy with the way the process is being handled and are ready to take matters to court over the slightest whiff of foul play.

Sources added that some bidders who have already spent millions of euros on their bids are fearing the consortium which, according to the Department of Contracts’ official notice, presented the lowest bid is being favoured by the Office of the Prime Minister and that behind-the-scenes manoeuvres are taking place in their respect.

Competing consortia that submitted higher bids are aware of what is happening and have made it known to the Prime Minister that they will have no other option than to resort to the courts if matters turn out the way they are fearing.

The situation so far

Following a request for proposals (RFP) that closed last April, a total of six bids were submitted.

While the government through the Department of Contracts is refusing to disclose the identities of the investors behind some of the consortia, it resulted that Katari Hospitality, which includes construction magnate Paul Attard of the GAP Group, made the largest offer at €41 million, which was followed by Iconic Malta Hotel, in conjunction with Nobu with its €39.3 million bid.

The other bids were from HV Hospitality (€24 million); AX Group (€22.6 million), Sea Bank Hotel and Catering Ltd (€20.9 million) and Valletta Luxury Properties (€1.2 million).

While the Department of Contracts has not made any changes to the official list of bids it received and has started the evaluation process, the consortium listed as having placed the lowest offer – Valletta Luxury Properties, owned by the De Cesare family of the Eden Group together with Mark Weingard of the Iniala Hotel – had articles placed in the media announcing that theirs was the highest bid as the €1.2 million quoted by the Department of Contracts was an annual rate and that the aggregate sum should have been €78 million.

Those articles, however, did not say the consortium had made a mistake in its submission.

This immediately raised eyebrows among the other participating bidders, arguing that what the De Cesare/Weingard consortium is now saying, after the closing of the bidding process, is incorrect and goes against public procurement rules.

So far, neither the Department of Contracts nor the OPM, which is handling the process under the direct guidance of the Prime Minister, have reacted to the press reports, which has raised further suspicions among the other players.

Fearing the OPM is somehow trying to accommodate the De Cesare/Weingard consortium, the other bidders sent objections to the OPM to the effect that they will not accept the result if the lowest bidder on record is somehow awarded the public concession.

The Shift is informed that some of the consortia are currently in talks over a possible joint court challenge in the case that the OPM continues with its ‘manoeuvres’.