The objective is to settle disputes between the partners and defray a $13 million debt to Bank Leumi.
Red Sea Group, headed by Eli Papouchado and contractor Avi Arenson, published a tender last Friday to sell most of Agripas Shukanion at 88 Agripas St., Jerusalem. They hope to get an assessor's estimate of $18 million, and perhaps more, for the property.
The partners are selling the third floor of the mall, which has 3,000 sq.m. of space; and 2,000 sq.m. on the first and second floors, divided into 89 shops, mostly small stalls; 70% of the covered 6-storey parking lot (the rest of which is owned by a Mexican investor); and 64 storerooms. The tender includes all the areas that have not been sold to date. The developers earlier sold most of the first floor, except for 600 sq.m., and half of the second floor.
The objectives of the planned sale are:
- Settling disputes between the partners. These include a dispute about whether Efraim Hoenig, one of Shukanion's developers, is still a partner in it. Hoenig told "Globes" on Friday that he sold his stake two years ago. A senior partner in the project said in response, "That’s what he thinks. In our opinion, he has not sold his stake, and is still a partner in the Red Sea Group."
- Arenson recently filed a NIS 20 million suit against the Red Sea Group. He claims he financed all of Shukanion's operating expenses in the past three years, while the senior partner has not shared in these expenses. The parties have been holding behind-the-scenes negotiations to settle the dispute. The sale will apparently settle this matter as well.
- Defraying a $13 million loan to Bank Leumi.
Published by Israel's Business Arena on 28 October 2001