The Dan Center deal, first reported by “Globes”, was closed last night after contractor Yehuda Amar raised his offer by $375,000. Amar will pay $10.4 million altogether for the first stage of the project, including the building shell, and building rights for the shopping center only. He plans to build a commercial center on the site to serve the haredi (ultra-orthodox) community of Bnei Brak.
Amar pledged to buy the second stage of the Dan Center within a month for $11 million. The second stage includes a 50,000-sq.m. office tower. Israel Discount Bank (TASE: DSCT) received an option to sell rights in the second stage for a higher price within a time period agreed to by the parties.
The deal was handled by Adv. Ron Bar-Nir, receiver for the Dan Center for Discount Bank. Located at the corner of Jabotinsky St. and Ben Gurion St. on the border of Bnei Brak and Ramat Gan, the project has been deadlocked for five years. A 17,000-sq.m. three-storey commercial center, topped by a 35,000-sq.m. 35-storey office tower, will be built on the 10,500-sq.m. lot.
The Dan Center’s developers - Canadel Development Tel Aviv, Givat Marom Ltd. Mey Arad Engineering Development and Building Co., and SC Talpiot bought the land in 1995 from the Shaulian brothers and Cohen brothers in a combination cash and stock deal. A few months later, a dispute erupted between the developers and owners, and work halted following reciprocal abrogation of the deal.
In 2000, Discount Bank petitioned the court to appoint a receiver for the Dan Center, due to the stalemate, non-payment of credit granted to the developers, and a debt of over NIS 100 million. Amar was the only bidder for the project.
Bar-Nir divided the Dan Center into two assets: the commercial center and office tower. Under the terms of the deal with Amar, the buyer will pay $10 million for the first stage (rights to the commercial center and a 900-space underground parking garage), and $11 million for the second stage (two office floors in shell condition, rights to 33 more floors, and 530 parking spaces).
Amar makes real estate investments and develops projects through his company, Amirim Engineering & Marketing Ltd. The company focuses on commercial properties for the haredi community. It currently has two project in Bnei Brak: a 2,500-sq.m. center on the Dubek factory lot; and a 9,000-sq.m. three-storey shopping center on the Histadrut lot on Rabbi Akiva St., with building rights for a 7,000-sq.m. office block.
Published by Globes [online], Israel business news - www.globes.co.il - on September 12, 2005