Major development company GAP Group is tapping into the local bond market to obtain the €22.5 million it needs to develop a 118-unit apartment complex at Żonqor, Marsaskala.

The majority of the money, €15.9 million, will be used to acquire the site, while the remaining €6.6 million will be used to partially finance development costs.

The €23 million bond issue (the difference will go towards issuance costs) by GAP Group Finance Ltd, a subsidiary of GAP Group, is secured by a fourth-ranking general hypothec over the issuer’s assets, present and future, a first-ranking general hypothec over newly set up GAP Zonqor Ltd’s assets, present and future, and a first ranking special hypothec over the Żonqor Site (and any developments and constructions thereon), each for the full nominal value of the secured bonds and interest thereon.

They will additionally be secured with a first-ranking privilege over the Żonqor site and any development on it for the amount of €14.247 million, and a pledge on the insurance policy proceeds for the full nominal value of the bonds and interest.

The bonds will have a nominal value of €100, issued at par, and will bear interest at the rate of 4.75 per cent per annum.

They are redeemable on 22nd December 2027 or at any date falling between 22nd December 2025 and the advertised redemption date.

The bonds will be made available for subscription to all categories of investors and offered exclusively to authorised financial intermediaries through an intermediaries’ offer.

The bond issue is conditional upon it being fully subscribed.

The minimum subscription amount is of €5,000 and multiples of €100 thereafter.

The offer period closes on 21st December 2022 at 2pm, or when it is fully subscribed.

The development

GAP’s Żonqor development will be built on a 5,000 sqm plot that form part of a 8,000 sqm site that entered into the development zone in the much-contested 2006 rationalisation scheme.

It was further rezoned for five-storey in 2019, on the request of the site’s owner, developer Anton Camilleri, known as Tal-Franċiż, who now stands to gain €15.9 million from its sale.

Reporting on the GAP development application, MaltaToday noted that traffic, visual and environmental impact studies do not take into consideration the development of the full 8,000 sqm site, while no such assessments were conducted for the 2019 rezoning application.

The development is expected to signifcantly impact views from across the bay and from behind, at Triq il-Blajjiet.

Current view from across the bay

View from across the bay with a photomontage of the development

It is also adjacent to a Special Area of Conservation with a number of mature trees and protected fauna and rubble walls, which were not noted in the application. However, the Environment and Resources Authority exempted the project from undertaking an Environmental Impact Assessment.

The development was recommended for approval by the Planning Authority’s (PA) case officer and a permit was granted by the PA Board in November 2022.