34 · MONEY
S U S TA I N A B I L I T Y
ISSUE 61
JP is a founding partner at Seed, a boutique advisory practise. An economist by profession, he is also a visiting assistant lecturer at the University of Malta.
HOMING IN Do we need to transform the real estate sector where all stakeholders should engage in a discussion to respond to today’s needs and future challenges? JP Fabri believes so.
There is no doubt that the real estate and construction industry have been significant contributors to growth over the past couple of years. Various projects have mushroomed over the island, providing jobs for thousands of foreigners who migrated to Malta, and in turn, these all contributed to the national economic activity. This construction boom has been supported by laxer permit issuance, supportive tax measures and a demand that has been fuelled part by increasing numbers of foreign workers and part by speculation. Over the past years, as the amounts of tower cranes kept peppering the skyline, the debate started to shift more towards the quality of growth, the safeguarding of the environment and the future of the market. As COVID continues to cause economic distress and to bring to the fore the debate on our collective future and especially the economic model, we need to collectively reflect on what future we envision for several sectors, including real estate and construction. Dubbed as the great reset, it is time that a serious, non-partisan and national debate is held on the transformation of our industries. As a small island state, we have been focused on diversifying and attracting new economic sectors. However, rarely have we sat down to chart a way forward for the existing sectors given the various challenges that they face and will face shortly. This exercise, dubbed industry transformation mapping, is something that the country needs to engage in to reassess, revalue and rethink the strategies for the future. This needs to
be pursued for all traditional and existing sectors including manufacturing, tourism, construction and real estate amongst others. The construction and real estate sector has been one of the most traditional industries in Malta. Our history as an island can be seen in our relationship with our stone from the temples to modern-day buildings. Construction and real estate have always been seen as a haven for investment purposes. Over the years, many people have invested their savings with the hope of multiplying them through real estate transactions. This mentality has supported the growth of recent years. The industry requires an innate ability to transform itself to remain an economically important sector but to remain futureready. The real estate industry is facing various challenges. New technologies have the potential to disrupt existing business models and traditional jobs. Consumers’ expectations are also rising—they want services which are more convenient, transparent and reliable. Also, environmental concerns are requiring buildings and building methods to be more reflective of this and to embrace the broader environment. A process needs to be initiated to transform the real estate industry so it can continue to grow and provide good jobs and economic value to the Maltese economy. The Government, together with stakeholders from across the entire real estate value chain, including property developers, contractors,
