Church-government ‘affordable housing’ tenders indicate a pre-determined result

An ‘innovative’ and questionable social housing project aimed at producing some 260 apartments at under-market rates for those dubbed by Housing Minister Roderick Galdes as the ‘stretched class’, is raising eyebrows among developers, businessmen and professionals, mostly architects, as conditions inserted in the tenders point towards a predetermined outcome and possible collusion.

The project, announced last month jointly by Prime Minister Robert Abela and Archbishop Charles Scicluna, will see four massive plots, formerly owned by the Curia, converted into tens of flats to be made available to middle-income earners who do not qualify for Housing Authority schemes but are still struggling to buy their first property.

Experts in the field told The Shift that, while the idea is positive, the way it is being executed is dubious and may be open to blatant abuse, particularly by certain developers.

According to the tenders issued in the form of an Expression of Interest, which are not publicly available but were seen by The Shift, the Foundation for Affordable Housing—a joint initiative between the Church and government, led indirectly by Minister Galdes—will not be responsible for developing the plots or constructing the units. Instead, the land parcels will be awarded to developers through a complex and unusual tender document.

These developers will pay very low, subsidised ground rent fees as part of design and build contracts and will have three years to obtain planning approval, construct the apartments, and sell them for prices ranging from €165,000 to €260,000 per unit.

The tender documents lack critical information, such as the full cost and value of the land, the nature of the subsoil (which significantly impacts project costs), and the final number of units to be built.

Experts are raising concerns about the timing of the tenders – in the peak of the holiday season – which impacts how developers can prepare a serious bid and fulfil the detailed requirements.

Several industry experts noted that the details of the tendering process suggest that some developers may have already been informally chosen. They explained that it is “almost impossible to prepare a robust bid in such a short time.”

Carmel Cacopardo, the Deputy Chairperson of ADPD and an experienced architect, also shared his concerns about the specific initiative in a social media post.

While the ADPD supports the initiative in principle, Cacopardo expressed scepticism after reviewing the documents released by the Foundation, stating he detected “a strong smell of irregularity.”

Focusing on a particular document related to a 4,800-square-metre plot in St Julian’s, Cacopardo remarked that, based on his professional experience, the details provided by the Foundation suggest that some developers may have already been alerted to the requirements even before the call was published.

He also noted that widespread rumours indicate that the developers chosen for these projects are already predetermined. He wrote that so far, when he sought clarification and asked for specific names, he had not been provided with any information.

Even PN MP Albert Buttigieg, a former CEO of the Housing Authority, expressed concerns about this initiative.

He stressed there was no justification for the government to provide land to developers for free instead of managing the project itself. Buttigieg mentioned that he would not be surprised if certain developers—who stand to make significantly higher profits due to the free land—have already been chosen by the Foundation.

The Malta Developers Association (MDA), typically on friendly terms with the Labour government, has requested the Prime Minister to halt the ongoing process for entirely different reasons.

The MDA criticised Minister Galdes for his management of the project, arguing that the government should not provide land that is so heavily subsidised by taxpayers, as this would distort the market and create unfair competition.

Industry sources confirmed that it is a well-established fact that land prices are the most significant and costly component in every construction project, determining all costs and profits.

They insisted that the way Minister Galdes is conducting this supposedly ‘social’ project, the chosen developers winning the bid will be able to cash in much more profit than if they had to buy the land and develop it themselves.

The Foundation is managed by CEO Jake Azzopardi from Qormi, the son of former Labour Party CEO George Azzopardi and a canvasser of Minister Galdes.