VBL’s Coliseum project in Zachary Street will be moving forward after the company negotiated changes to the sale agreement that will see the current owners, Pace Brothers plc, take a stake in the Valletta real estate company, whose shares started trading on the Malta Stock Exchange last month.

The parties have, on 10th November, entered into an addendum on the original promise of sale agreement for the €6.5 million property, which will now be payable as follows:
i. €650,000 n the execution of the addendum
ii. €2,850,000 on the final deed of sale
iii. €1,000,000 to be paid to the vendor in kind by virtue of an issue of 3,571,428 shares in VBL, of a nominal value of €0.20 per share at the offer price of €0.28per share, on execution of the final deed of sale
iv. €2,000,000 without interest payable by no later than the second anniversary from the date of the addendum.

On the final deed of sale, the vendor shall be entitled to reserve in its favour the special privilege and special hypothec over the property in order to guarantee the unpaid part of the price.

In VBL’s IPO prospectus, the company detailed the original terms, which would have seen Pace Brothers allotted shares amounting to €3 million.

VBL, which is the largest private real estate owner in the Maltese capital, further announced that it has successfully negotiated with Pace Brothers plc that, notwithstanding the Addendum’s inclusion of an extension with respect to the execution of the final deed by up to 12 months and the amendment to the payment terms, it is entitled to immediately apply for any permits with the Planning Authority.

In this respect, Pace Brothers plc has agreed to grant access and execute any necessary documentation as may be required.

Since the development process will continue on schedule, VBL stated that it does not expect the the changes in the terms to cause material departures from the revenue expected to be generated from the property.

The Coliseum refers to a number of adjacent properties on Zachary Street that will be developed for commercial and office use.

The property consists of an existing commercial shopping arcade and formerly used cinema spread over three floors, with a gross floor area of circa 1600 square meters. The property also has the potential to extend more floors as it is lower than other properties on the street.

The building approximately dates to the 19th century, with interventions done in mid to end 20th century.

In the IPO valuation, which included the airspace, the property in its current state was valued at €12,380,000.