Boutique hotel on sale at €4.2 million

The luxury boutique hotel in Birgu, the Palazzo Vittoriosa, has been put up for sale at €4.2 million, just 18 months after opening for business.

The former 16th century palace is owned and was renovated by Dutch couple Jessica and Remco Slik, who received €85,000 in EU grants for the renovation.

A change of use does not seem to be being ruled out, although this has raised questions as to whether it would bring the owners into conflict with EU rules over the considerable funds issued for the hotel’s renovation.

Malta Tourism Authority chief executive Josef Formosa Gauci said the EU money would have to be paid back if the property were to be sold as a residence.

The hotel opened for business in December 2012, with then Prime Minister Lawrence Gonzi saying that the boutique hotel “showed the way forward in transforming Malta into a top class destination for tourists in the shoulder months”.

Formosa Gauci said that, prior to this newspaper’s call, he had been unaware of any plans to sell the hotel. “What we would now need to look into is in what form the property is going to be sold,” he said. “At the end of the day, the owners were given the grant for the restoration and opening of a top-end hotel.  The scheme was not given to them in order to fund a private residence or sell it as such.

“If the property is sold as a residential unit, then the owners would need to pay back the grant they received in its entirety,” he said. “If, on the other hand, the plot is sold as a going concern – with the purpose of the property remaining the same – then the new owners would need to take on the responsibility of the agreement themselves.

“The fact of the matter is that the obligations and commitments agreed to at the time need to be met and adhered to,” he said. “If that property becomes a private residence, it would completely change the purpose of those funds.”

On his part, Remco Slik said that it was only “the nature of business” to put property up for sale, in order to gauge the level of market interest there was in the property. “The business is thriving and we are very happy with the feedback we have been getting,” Slik said. “We even get a lot of international coverage.”

Asked if the couple are to sell the place as a hotel or otherwise, Slik said that was a decision which was out of his hands. Nonetheless, he expressed a wish that the hotel would remain in its current form. “It would be crazy, stupid even, for me to want to see something I have put my heart and soul into, just disappear,” he said. “So, definitely my preference will be to see the Palazzo remain as it is but, ultimately, that is not really up to me.”

When it was put to him that should he sell the hotel as a residential property, he would need to pay back the funds he received, Slik said that he fully understood the situation. “We have a signed a public contract,” he said. “There is, of course, no way we can walk away from that.”

The Sliks, who have lived in Malta since 2001, bought the Palazzo Vittoriosa in May 2008 and transformed it into a top-end bed-and-breakfast, declaring that “it was a shame to keep this historical gem for ourselves.”

Initially built in 1565 and unused for decades prior to its transformation into a tourist asset, the palace was a beneficiary of sustainable tourism funds. The question now is whether it will be sold as a residential property.