Investors fronted by Joseph Portelli to purchase Jerma

A group of investors fronted by Gozitan entrepreneur Joseph Portelli are in the process of buying the Jerma hotel site for a reported €90 million, MaltaToday has learnt.

Industry sources said Portelli, who is the person appearing for the high-rise Mercury House project in Paceville, is now fronting a group of Maltese and foreign individuals to buy the abandoned hotel site in Marsaskala.

Portelli’s style is to carry out the preliminary work to purchase sites and apply for permits, while raising capital through investors interested in aggressive high returns.

The entrepreneur works from the same Portomaso office once used by the former disgraced EU Commissioner John Dalli.

Portelli still uses the services of Dalli’s daughter, Claire Gauci Borda, who is involved in the financial aspect of his varied construction operations.

The sources said the sum floated among the investors was “far higher” than the €20.8 million the Jerma hotel was valued at by court-appointed architects three years ago.

It is understood that the investors have signed a private agreement with Portelli, although no formal promise of sale agreement has been entered into with the Montebello brothers, who own the Jerma.

Portelli could not be reached for comment despite repeated attempts to contact him, including an email sent to his office last Friday.

Portelli’s company, J. Portelli Projects, describes itself on its website as dealing mainly “with the acquisition, development and sale of all types of residential and commercial properties located all around Gozo and in select areas of Malta”.

Portelli also owns the chain of boutique hotels going by the name Quaint.

The Montebello brothers had to abandon plans to redevelop the Jerma site some years back after they ran into financial difficulties.

A court valuation carried out in 2016 had put the value of the seafront site, which is as large as five-and-a-half football pitches, at €20.8 million.

The valuation formed part of a judicial sale by auction ordered by the court in a case instituted by HSBC Bank against brothers Geoffrey and Peter Montebello’s firm, JefPet Ltd.

However, the judicial sale was suspended when developer Charles Camilleri, known as il-Franċiż, and lawyer Pierre Lofaro, through their company Porto Notos Ltd, filed a planning application proposing the demolition of the hotel, land reclamation works and the construction of a mixed-use development consisting of three high-rise buildings.

In the application, Camilleri declared that his company did not own the land in question but had the consent of the owners.

The plans were subsequently amended and the application is still pending.  

Marsaskala is not identified as a high-rise zone and the plans could meet resistance, although the policy regulating hotel heights allows stand-alone hotels located within the development zone to add an unlimited number of floors.

It is unclear whether the latest move by Portelli will embrace the planning application filed by Porto Notos and what role this company will play if the investor deal goes through.

Jerma owners miss deadline

Meanwhile, the Planning Authority has confirmed that the current owners of the Jerma hotel have still not submitted a method statement, explaining how they intend to remove the eyesore and danger created by the dilapidated hotel along the coast.

A court ruling last month, confirmed the decision of the Environment and Planning Review Tribunal that upheld an enforcement on the site slapped by the Planning Authority.

The area has been reduced to a dump and den of abuse with residents in the area long-complaining of the danger posed by the abandoned hotel.

The court gave the Montebello brothers 30 days to provide the Planning Authority with a method statement.

A spokesperson for the PA confirmed that no such method statement was submitted and the authority was now considering what further action it would take to ensure that the enforcement order issued is obeyed.