There was another sign yesterday that the Tel Aviv office rental crisis has put the Covid pandemic behind it, when Israeli income producing real estate companies Amot Investments Ltd. (TASE:AMOT) and Bayside Land Corp. Ltd. (Gav Yam) (TASE:BYSD1) announced that they are set to begin construction and marketing of the ToHa2 office tower in the coming few months.
The 63-floor building will contain 160,000 square feet of office space and will have a 45,000 square meter underground car park. Amot and Bayside will each invest NIS 1.5 billion in the project for a total investment of NIS 3 billion and will own the building in equal parts. The project is due to be completed in 2026.
The tower will be at the junction of Derekh Hashalom, Yigal Alon Street and Totzeret Haaretz Street facing the Azrieli Center on the other side of the Ayalon Highway. ToHa2 will be adjacent to the distinctive ToHa1 tower, the 55,000 square meter, 29-floor tower which was completed in 2018 and is also owned equally by Amot and Bayside. ToHa1 has 90% occupancy and leases with average rent of NIS 127 per square meter per month.
Amot and Bayside estimate that ToHa2 will yield NIS 280 million in annual rental income according to today's prices. The building is located in the highest demand area in Tel Aviv for office space and NIS 150 per square meter per month is the current going rate for leases in the area.
Published by Globes, Israel business news - en.globes.co.il - on October 12, 2021
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