SkyParks 2 hotel tender to be adjudicated in coming months

MIA reports €52 million loss in Q1-Q3 revenue compared to 2019 • Work underway to finalise design and costs projections for SkyParks 2

SkyParks 2 will house office and retail space and a business hotel
SkyParks 2 will house office and retail space and a business hotel

Malta International Airport’s request for proposals for the operation of a business hotel to form part of the new SkyParks 2 building will be adjudicated in the coming months, BusinessToday has learned.

MIA CEO Alan Borg confirmed that, although the company had shelved most of its expansion plans in the wake of the COVID-19 pandemic, work on the €40 million SkyParks 2 project had gone ahead.

“At the moment, we are currently working with the project’s architect to finalise the design plans,” he said. “And within a couple of months, we expect to conclude the adjudication process for the operation of the business hotel, after which we will go to our Board with the full plans and projected costs.”

The hotel is projected to cover around 5,700sq.m of floorspace and include around 90 rooms of at least four-star rating.

SkyParks 2 will be a mixed-purpose building offering office and commercial space and is set to include conceptual elements geared at achieving energy efficiency and rendering the building eligible for BREEAM assessment and subsequent certification.

On Wednesday, MIA announced a Q1-Q3 loss in revenue of over €52 million when compared to the same period in 2019.

Revenue dropped by 67.7%, from €77,275,444 between January and September 2019 to €24,286,434 for the same period this year.

And the company does not expect to return to 2019 figures before 2024 at the earliest, Borg told BusinessToday.

“Our projections our aligned with those of the International Air Transport Association and the IAC and reflects the projected post-COVID recovery forecasts for the industry globally,” he said.

The company’s performance continues to be severely impacted by the COVID-19 pandemic’s effects on both its aviation and non-aviation activities.

The aviation industry has now entered the winter period, which is expected to be the most challenging in living memory globally.

In October, MIA welcomed 110,346 passengers, bringing year-to- date traffic up to 1,661,700 passenger movements. This translates into a drop of 73.8% when compared to the same period in 2019.

The company said it is confident that its financial resilience amassed over the past decade together with the right team of employees put it in a good position to continue facing COVID-related challenges and eventually emerge from this crisis.

MIA’s cost-cutting and liquidity preservation programme, which was implemented by the company in April 2020, has enabled it to register a significant decrease in both its staff costs and operating costs.

The lowering of staff costs by 24.1% for the first three quarters of 2020 resulted from a reduction in management and employee wages from April until July 2020, together with contributions from the government COVID-19 wage scheme.

MIA also registered a decrease of 38.4% in operating costs, which resulted from several measures taken by the company, including the revision of its maintenance programme to focus solely on essential works.

Borg said that besides SkyParks 2, the expansion of the car park had been completed and work was continuing on the cargo village development.

“The uncertain circumstances we are facing with COVID-19 means that we will be constantly monitoring the situation and tweaking and updating our plans as necessary,” he said.

“It is to be expected that new measures and plans be introduced as the company fights its way back to pre-COVID operational levels.”

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