Comverse (Nasdaq: CMVT) is likely to postpone starting construction of its large office projects in the north Raanana industrial zone. The projects are estimated to cost $150 million The company plans to build 100,000 sq.m. of offices and 120,000 sq.m. of parking space.
Comverse Technology issued a profit warning last week, which led to a plunge in the share price. Forecasts say the company is likely to decide to cut back the scope of the Raanana project.
Comverse Technology bought the 40 dunam (10 acre) plot from the Savirsky family for $20 million. The company had planned to start construction in January 2002 and build the entire project in one stage, erecting what was expected to be the largest high-tech complex in Israel. Comverse Technology currently occupies a 12,000 sq.m. building in Ramat Hehayal, Tel Aviv.
E. Epstein is managing the project; the chief contractor has not yet been chosen; and work on the plans is continuing as scheduled.
A source involved in the deal told "Globes" over the weekend, "Converse hasn't yet withdrawn the green light for the project. Doubts exist about the project, but no formal decision has been made."
Comverse Technology's response was not received by web posting.
At the same time, Cellcom postponed its decision about whether and where to build its new 55,000 sq.m. headquarters by a month. The decision was postponed until the middle of August. The three bids reaching the final round were submitted by Delek Real Estate for a site in Hod Hasharon, SGS-Shemen for a site in Kiryat Arie, and Caniel for a site in Kiryat Arie.
Published by Israel's Business Arena on 15 July, 2001