Some readers replied to my post on Hili’s project in Comino saying that the land is prime real estate and that it’s a good investment as a beach resort and tourist hub etc…
Sure. I know. Thanks. I’m stupid, but I am not that stupid. My point is, why Comino? There is plenty of other prime real estate going at a discount across the developed world right now, and Hili has the resources to access any market they like. So, why Comino? Let’s take a quick look at the history of this project.
Hili Ventures bought the hotel and the site around it in Comino from Tumas Group and Alf Mizzi for €55 million. Then they proceeded to issue €80 million worth of unsecured bonds at 3.8% maturing in 2029 to fund the development of a new tourism resort in Comino. Although the tourism resort will be aimed at high-end customers, Hili won’t be paying back the bonds with revenues from bookings at their resort. They are not looking to make money from this project, but the end result will be that they will add value to their real estate and they will end up owning a high-end tourist resort in Comino.
Clearly, Hili Ventures are not doing this project to make money. The aim is probably vanity, just to be able to say that “We own Comino.” They are ready to sacrifice their reputation and their capital just for vanity.
“The proposed project is subject to the issuance of necessary approvals and planning permits, and having the required funding in place.” This smells fishy. The purchase of kemmuna Limited is subject to permits. This deal would not have been entered into unless the authorities had given a nod that the building permits would be issued. The application is pre-determined.
Kemmuna Limited and HV Hospitality Limited merged as from 1 January 2022. It seems to me that this deal would not have gone through without a nod from the authorities that the planning permits would be issued.
Interesting point, thanks.