IKEA Israel apparently will not have to bid alone in a repeat tender on the Me'uyan Soreq lot in Rishon LeZion; sources inform ''Globes'' that Meshulam Levinstein Contracting and Engineering Ltd. (TASE:LEVI) is interested in bidding, and, if it wins, in leasing the lot and approached IKEA with an offer to rent it.
Two weeks ago, the Israel Land Administration (ILA) published a new tender for the 98,000-square meter the Me'uyan Soreq lot, with a minimum bid of NIS 132 million, plus an additional NIS 293.6 million reimbursement to Iris Hagilboa Construction and Development Ltd. for constructions costs already incurred on the site. Iris Hagilboa is a subsidiary of Bronfman Fisher Investments Ltd. which owns the IKEA Israel franchise.
The present tender replaces the 2006 tender won by Iris Hagilboa for NIS 109 million. Bronfman Fisher planned to build its second IKEA store in Israel on the site. However, the Tel Aviv District Court for Administrative Affairs annulled the tender last year, after Judge Nurit Ahituv ruled that Iris Hagilboa received preferential treatment.
The sources added that Levinstein president Shaul Lotan approached IKEA Israel to rent part of the Me'uyan Soreq lot for its second store, while Levinstein will develop the rest of the site. If IKEA Israel accepts the offer, it would sign a long-term lease. These terms apparently fit in with IKEA's own plans. Iris Hagilboa does not intend to bid in the new tender if a large developer offering it a good, long-term lease decides to bid.
Levinstein declined to comment on the report.
Published by Globes [online], Israel business news - www.globes-online.com - on November 30, 2008
© Copyright of Globes Publisher Itonut (1983) Ltd. 2008