The Israel Land Administration (ILA) Council is due to discuss two controversial real estate developments at its upcoming meeting on December 30: the Aquaria water park and golf course in Eilat, and the Dolphinarium seafront project in south Tel Aviv.
The Beersheva Regional Planning and Development Commission approved the $291 million 1,300-dunam (425-acre) Aquaria project, but environmental groups and the Eilot Regional Council petitioned against it with the Beersheva District Court and High Court of Justice on the grounds that the developers obtained Kibbutz Eilot's land without a tender.
The developers are due to invest $100 million of their own money in the project, and will get a $160 million bank loan and $30 million in a government grant. The project will reportedly create 2,000 construction jobs, 6,000 regular jobs after completion, and turn Eilat into an international tourist resort.
The Dolphinarium involves a three-way deal between the ILA, Tel Aviv municipality and German developer Yosef Buchman, who has leased the site since 1978 under a 50-year lease. Under the pending agreement, Buchman will demolish the Dolphinarium at his own expense, and the six-dunam (1.5-acre) lot will be handed over to the municipality, for a public park that will extend the boardwalk between Tel Aviv and Jaffa. In exchange, Buchman will receive 12-dunam (3-acre) site, zoned for the construction of a mixed residential-hotel-commercial project east of Koifman St., Tel Aviv. In 2003, the government assessor valued the Dolphinarium lot at NIS 44.5 million and the alternative site at NIS 283 million. Buchman would pay a betterment tax of 31% on the difference, instead of the usual 91%.
Although the ILA approved the deal in early 2003, Buchman canceled it in 2005. Meanwhile, the State Comptroller ruled that the ILA had made a bad deal based on dubious valuations of the use of the alternative lot. The State Comptroller also claimed that Prime Minister Ehud Olmert, who carried ministerial responsibility for the ILA at the time, adopted the Tel Aviv municipality's position on the deal, which claimed that the ILA should bear the costs for expropriation of the Dolphinarium.
The ILA responded that this was the best deal possible for the lot, which would expand public seaside space.
Published by Globes [online], Israel business news - www.globes-online.com - on December 23, 2007
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