Updated | Expropriation made news ‘because of Gaffarena’s surname’ – Falzon

Michael Falzon denies political interference in Gaffarena's deal

The parliamentary secretary for planning Michael Falzon has defended the €1.65 million compensation for the expropriated property of Marco Gaffarena in Valletta, claiming the process was entirely regular.

Gaffarena was paid the compensation in cash and lands for half a property on Old Mint Street that houses the government offices of the Building Industry Consultative Council.

After receiving compensation in January 2015 for his ownership of a quarter of the property, he purchased another quarter in February and got an expropriation in April.

“There was no political hanky panky… it was a regular transaction within the parameters of the law,” Falzon said, adding that the government faced eviction from the property by 2028 and therefore had to expropriate it.

Shadow justice minister Jason Azzopardi however said in a press conference later on in the day that it was “impossible that no political direction was sought.”

“There is a valid reason why the Lands Department falls under the Prime Minister,” Azzopardi said.

He said that the GPD should publish all the files on the case so that the public can learn how the valuation was made.

“I ask why has this expropriation been carried out so quickly… and why government only expropriated half of the property instead of buying it all up if it was for a public purpose.”

Parliamentary secretary Michael Falzon also said that no criminal investigation was necessary.

“If we were to view this as a criminal case, then we might as well throw all businessmen into jail,” Falzon said, denying that Gaffarena could have been the beneficiary of inside information.

“The only reason it made the news was because of his surname,” Falzon said of Gaffarena, an associate of Labour MP Joe Sammut, and whose petrol pump station in Qormi is associated with a number of illegalities that were recently sanctioned under the Labour administration.

“We did not know when Gaffarena began negotiations to buy the rest of the property. It could have been ten years ago for all we knew. The government decided to buy the land in 2014 and Gaffarena’s decision to buy the rest of the property is not something that falls into our remit: we don’t look at private business deals.

“The land was realistically valued at €822,500 by architects appointed by the Government Property Division. We’re not private estate agents and negotiate according to the fair market value. If Gaffarena had originally bought the land for a cheaper price than the market value, then he simply made a good business deal.”

Gaffarena made a killing of €685,000 in profits in just two months thanks to a fast-track expropriation of his Valletta property.
The government property division (GPD) paid him €1.65 million in land and cash for half-ownership of an Old Mint Street, Valletta.

Gaffarena bought a quarter of the property for €23,294 back in December 2007. In January 2015, this part of the property was expropriated and Gaffarena was paid €822,500 in land and cash. But in February 2015 he purchased another quarter of the property for €139,762, and then this was expropriated in April for compensation of €822,500 in land and cash.

In total Gaffarena was paid €516,390 in cash, land measuring 1,663 square metres at White Rocks valued at €70,000, as well as adjacent land measuring 3,735 square metres, valued at €260,000; land measuring 24,073 square metres and another measuring 2,150 square metres in Zebbug, together valued at €375,000; a €65,000 property on Manwel Dimech Street, Sliema; land at Ta’ Kandja measuring 5,992 square metres valued at €165,800 and 9,980 square metres at land at Handaq valued at €192,810.

Gaffarena is a shareholder in J Gaff Service Station Ltd, whose petrol pump in 2014 was finally granted a controversial permit by MEPA after having been forcefully shut down in 2008 and again in 2009 after its owners illegally built new structures on site.