13 - 19 September 2001

CC Car Parks plc issues Lm1.5m bond issue

by Ivan Brincat

CC Car Parks plc has issued a Lm1.5 million 6.5 per cent bond issue redeemable at par in 2006.
The bonds were issued last Friday at their nominal value of Lm100 per bond and they are guaranteed by Bank of Valletta plc which makes this issue the first of its kind to be listed on the Malta Stock Exchange.
The proceeds of the issue will be used to refinance long-term bank borrowings. Bank of Valletta plc is underwriting this issue.
The subscription lists open tomorrow and are scheduled to close on 20 September but may close earlier, at the issuer’s discretion.
CC Car Parks plc is the owner and operator of the multi-storey car park situated in Sliema. Its business consists of the operation of the 500-space car park. CC Commercial Projects Ltd, a wholly-owned subsidiary of CC Car Parks plc owns areas within the car park site which are leased for the operation of a supermarket and restaurants.
The multi-storey car park project was planned and designed to meet the increasing demand for parking in Sliema in 1992. In 1994, the Planning Authority issued a permit.
Construction of the nine-level structure started in 1995 and two years later the 500-space car park was fully operational. Last year, a three-level supermarket complex and restaurant area were added to the car park.
The chairman of the company, Carol Calleja said the car park has experienced a significant increase in the user volumes over the last three years with volumes increasing by over 13 per cent annually. “In addition, signification revenue is derived from the leasing operations,” Mr Calleja said.
Speaking about the bond issue, Mr Calleja said they offered prospective investors an excellent return. “In addition, Bank of Valletta have guaranteed the payment of interest and capital.”
The Group has a 20 per cent investment in Preluna (Chalet) Limited which was set up specifically to tender for the bid to build and operate the proposed car park on the site of the Sliema Chalet.
Total revenue has doubled over a three-year period from Lm149,000 in 1999 to Lm296,000 in 2001.
Even the total vehicle entry has increased from 215,000 to 276,000 leading to an increase in revenue from Lm132,000 to Lm177,000.
The managing director of CC Car Parks plc, Simon Stilon said that the growth and expansion of the retail trade in Sliema over the last few years had been a major contributor to the company’s increased revenues and higher volumes of customers.
Mr Stilon said Malta had one of the highest rates of car ownership in Europe. In the early 1990s, traffic growth rates were estimated at two per cent per annum for the next 10 years. The actual traffic growth rates from 1990 to 1998 equalled four per cent. Actual traffic growth rates from 1998 to 2000 was 5-6 per cent. Moreover, the use of public transport fell by four per cent per annum between 1991 and 1998.
He said that car travel will remain the preferred choice for the majority of shoppers and commuters in the future.
Mr Stilon said the PA Household Traffic Survey had indicated that Sliema was the island’s most congested town and is expected to remain so in the future.
He said the car park is ideally located to accommodate the expected increased demand and will continue to benefit from its prime location.
The company will seek to maximise further the advantage of being in the town centre through yields and utilisation plans, long-term agreements, short-term parking and occupancy levels.