INTERVIEW | Wednesday, 18 July 2007

Transforming a derelict jewel into a luxurious diamond

Interview with Andrew Cross, Chairman Madliena Village on the challenges and opportunities encountered at one of malta’s finest real estate locations

Andrew Cross is a man full of energy, empathy and drive, this was apparent from the first moment that we shook hands. After having invested a considerable sum of money into the project now aptly named Madliena Village, he is more than enthusiastic to get selling what is undeniably one of the finest real estate developments available on the island.
But what made Andrew select this area, tucked into the Madliena hills, undoubtedly a stupendous location to sink in his cash?
“I had been coming to Malta for about five years and was involved in a number of projects but nothing so spectacular in the first instance. My company has developed and sold a number of properties in the UK so the decision to invest in a big project such as Madliena Village came pretty easily as Malta also has connections with the UK and its a very safe country, something which British expatriates look for. We took over the project in midstream so to speak. We have been pushing the development forward after two years under its new name and that’s the story so far ”.
What did Andrew think of the actual location and did that prompt him to take the decision to re-develop the area?
“Well, the location is lovely and the greatest plus point, at least in my mind is that you can’t build in front of the location as it’s a valley and that adds value to the development. What’s happening in places like Sliema now is that you aren’t guaranteed any sort of view as in a few months, some developer might come and tear down the house in front of you and bang goes your view, apart from the massive inconvenience that is caused by all this building going on and parking problems. So we thought that unobstructed country views which will remain forever in their pristine condition are a huge big plus”.
What did the project entail in terms of refurbishment and re-development after having been at a standstill for a large number of years?
“Well basically we re-graffiatoed the whole site as before it was simply painted plaster in red.This was to create a much more environmentally sensitive, high quality and attractive external colour scheme We did this to all the blocks, even to those which we didn’t own and we also refurbished everything which needed to be seen to. We have also started rebuilding the access road around the residences and are well ahead with the final phase of the project, that is the building of the final two blocks, what we call the tens and twenties”.
What has the response to the project been so far?
“We have only very recently started to re-market the properties as in the middle of our tenure, the tax law changed to an overall 12 per cent tax on apartment sales which definitely had us worried for a time as we were trying to sell the project abroad and had to rethink our strategy. We had to apply for Special Designated Area status and that took us most of 2006 which allows us to market the properties to a broader brand of people. We have now been marketing on this new SDA basis as this gives us and our buyers much more flexibility”.
What about the client mix, and how have the people who have resided in the complex for a number of years viewing this new change in their lifestyle?
“Basically what happened, when we came in there was no condominium agreement in place at all. So we talked to the residents and came up with a unanimous agreement where each resident pay the sum of Lm 400 a year that goes into the kitty, so to speak. Out of this sum, we can take care of cleaning the common areas including the lifts and gym, and of course maintaining the pool and gardens. It’s an agreement which works for everybody and the residents are very happy that something has been organised at last”. Apart from owners who buy the apartments as a residence we are also seeing a lot of interest from owners buying to let. Letting of apartments in Madliena Village is a very attractive proposition indeed
With all the luxury developments going on in the island, how does Madliena Village stand out from the rest and will it succeed?
“There are a lot of projects but most of them are in different sorts of areas but few have the type of view and quiet location which we have here. Obviously if you want to be near the sea, then we cannot offer you that, but some people prefer the peace and quiet of rural Madliena Village. Other mass-market developments such as Pender Gardens and Fort Cambridge are basically just tower block arrangements so we aren’t really in competition with those. We really believe that our major selling point is the location, the quality and low rise of the apartments and the marvellous view that’s on offer”.
We came to the finishing standards of the apartments and how these are being arranged according to client’s requirements.
“We organized an open weekend recently where we offered a free kitchen and turnkey interior design package. We are offering the apartments fully finished according to what the client wishes and we definitely aren’t trying to sell apartments in shell form anymore. Actually, we don’t believe that there is a market for shell form apartments anymore and it is only finished properties which are selling – people just don’t have the time and hassle to stay running after workmen”.
Are any future projects planned after the completion of Madliena Village?
“We don’t have anything in mind as we are fully concentrated on selling this development – it’s pretty big and we have invested a considerable sum and most of our time into it. We will only look at other projects when we have got things close to finishing Madliena Village in 12 months time; at the moment there’s nothing planned as we do have our hands full”.
What about the foreign aspect of the project, are any overseas purchasers being targeted?
“We’ve just started advertising in Homes Overseas back in the UK, and are planning a major newspaper campaign starting this Autumn. However, it is challenging to market the project on its own as the country lacks strong marketing and recognition as a real estate destination in the UK. You do get your fair share of UK tourists coming over but these aren’t the sort who will perhaps buy a luxury property in Malta so some more work has to be done on promoting the country. We have chosen the theme called ‘Mellow Malta’ and ‘Mellow Madliena’ and I am sure will be successful”.
What about the English links with Madliena in terms that it used to be a military location? Does that have any recognition effect on prospective home hunters in the UK?
“No, not really. People from the UK like to come to Malta because it’s a safe location and also another huge plus point is the fact that you all speak English around here. So a combination of safety, location and language make Madliena Village even more attractive to prospective buyers from the British market”.
So does Malta need to be marketed much more?
“There’s a lot of promotion for holidays but next to nothing in terms of residency attractions. You’ve got much more favourable tax laws compared to the UK and elsewhere and I sincerely believe that if Malta is marketed more as a residential location, there will be quite a success. This opportunity is being missed”
Are you satisfied with the local estate agents performance?
“In the beginning, we inherited a sole agency agreement but that doesn’t work in Malta so we decided to go to an open agency agreement but that didn’t yield the results we were after. We are trying to attract the big estate agents to come in and help us promote the project more and most of the agents are now supporting us. The agents can now see that we are confident in finishing the project in the next 12 months after it was at a standstill for so long. Having said that, Maltese agents remain Maltese agents and the situation works very different to what we are used to in the UK with sole agents. In Malta when you have a sole agent, all the others start speaking against the project and that creates a disconcerting situation but with an open agency, we hope to have solved these problems”.
Is the project only being marketed in the UK or are other foreign destinations being considered?
“We have a local agent in Malta who has representation in Stockholm and Oslo where the project is also being promoted. We are strongly supporting these initiatives as we already have Scandinavian residents in Madliena Village. We are trying to stay with the agents at this level and are not directly involved in selling to these other potential markets”
Andrew explained that the marketing campaign would continue in earnest for the next six months. Asked about the situation regarding the bad name that the old Busietta Gardens had in the past, he said that old habits die hard, but slowly the situation was getting better and as the project continues to move forward, the past stigma will continue to disappear.
Finally, I asked about the targeted completion date of this massive project.
“The target date is Autumn of 2008 when the new blocks would have been finished. We are also doing the roads up independently of the main contractors and with all the work going on, we are confident that people will continue viewing the project in a more positive light. A small issue we have is the state of the main road leading to the village, which is in a very bad state but which is the responsibility of the government. We have tried to put some pressure but so far no success has been achieved”.
Andrew said that the local council hasn’t been so supportive either as Madliena forms part of the Swieqi council at the very end of the perimeter so little attention is received.
After the pleasant interview, I was given the opportunity to view one of the apartments complete and sumptuously furnished. The 220 sq metre apartment is luxury in itself, full of light and wonderfully kitted out. Andrew has also developed a gym which adds value to the development and as all roads lead to Rome, one can only wish him luck in completing what can be termed as one of the finest real estate developments on the island.