Confidential deal silences objectors to Townsquare development, binds them from future opposition

Malta Developers’ Association (MDA) President Michael Stivala has reached a settlement with 14 residents who objected to his plans to include a hotel in his Townsquare mega-project, according to a private agreement seen by The Shift, in which Stivala insists that the agreement must not be disclosed to third parties.

In the agreement, dated 7 January, Stivala promises to drop plans to build a 10-storey hotel from a contested planning application and replace it with a small outdoor area. 

The pledge made by Stivala’s ST Property Investments is limited in scope. It does not bar the company from submitting new planning applications that include a hotel. Instead, it only commits the developer to making changes to the current set of plans already under consideration.

In exchange for this limited commitment, the objectors agreed to stop opposing the project. Specifically, they undertook not only to withdraw their existing objections (within five days of the agreement signed), but also to refrain from objecting to any future planning applications relating to the Townsquare site.

This means that the developer gave a relatively narrow concession – adjusting existing plans rather than restricting future development – while the objectors made a broader commitment by effectively removing themselves as a source of opposition to any subsequent proposals for the site.

Former objectors agreed to “endorse and not to object to any other applications made to any other government authority… in relation to PA/1398/23…This provided that anything which the objectors are required to endorse does not run contrary to this agreement.”

Stivala further obliged objectors who signed this agreement to “not disclose this agreement to any third party who is not a party without prior authorisation from ST”, a glaring lack of transparency in what is supposed to be a public decision-making process.

While the agreement names 14 objectors, at least two are known to remain opposed to Stivala’s plans, indicating that the fight against the project’s contested commercial expansion is set to continue.

The Townsquare saga stretches back several years. Initially, the project was the brainchild of a consortium of some of Malta’s wealthiest families. The original owners envisioned a 38-floor tower, which was downscaled to 28 floors after public outrage forced the developers to amend their plans.

A couple of years after the revised plans were approved by the Planning Authority (PA), the Stivala group announced that it had signed an agreement with the original consortium to acquire the site and build the 28-floor version of the project.

In 2023, the PA approved Stivala’s previously undisclosed expansion plans, which featured the contested 10-storey hotel and an additional 75 apartments within the same tower.

A series of appeals to the Environment and Planning Review Tribunal (EPRT) were rejected, thereby confirming the PA’s approval. Then, objectors resorted to court action, and the court eventually ruled partly in favour of the appellants and ordered the EPRT to reassess its decision.

In its ruling, the court decreed that a hotel cannot be built on the site’s public open space, that no restaurants can be built within the residential component of the site, and that apartments within the tower must be at least 150sqm in size.

Within this context, Stivala’s private agreement with these objectors effectively influences ongoing public processes through a deliberately restrictive settlement, especially given that 14 individuals with a direct interest in this public process legally bound themselves to endorse any plans that Stivala chooses to submit.

Stivala had made unsubstantiated allegations against environmental NGOs, claiming that businesses were using such groups to harm competitors and that NGOs “are accepting money and doing it happily.” This was strongly denied by the organisations.

Questions were sent to Michael Stivala to ascertain why the developer felt the private agreement was necessary, to determine whether the company excludes any hotel development on site indefinitely, and to explain how the company justified interfering with a public planning process via a private agreement.

Editorial note: Stivala replied to our questions following the publication of the article. You can read his answers here.