A number of major construction firms, including Africa Israel Investments, Ashdar and Azorim, will cancel deals to construct thousands of apartments on kibbutzim (collective settlements) and moshavim (cooperative settlements) land. The move follows last Thursday's High Court of Justice decision in the matter. Delek Real Estate, however, which is also active in such transactions will be practically unaffected.
Among others, Africa-Israel will call off deals to build over 1,000 apartments on land belonging to Kibbutz Magshimim. The company will also cancel transactions with kibbutzim in the central region. Like the other companies active in the sector, Africa-Israel's contracts stipulated that the deal would become effective only after approval by the Israel Land Administration (ILA). The HCJ decision prevents the ILA from approving deals under Israel Land Administration Council Resolutions 717, 727, and 737.
Ashdar, also very active in the sector, will cancel a deal with Kibbutz Kfar Maccabi, near Haifa, for construction of 700 apartments. Other deals involve the Yavne Cooperative Society (600 apartments), Givat Brenner (300 apartments), Ayelet Hashahar (200 apartments), Lohamei Hagetaot (150 apartments), and Rabadim and Yasour (120 apartments each). Also involved in the deals with Givat Brenner and Lohamei Hagetaot is Meshulam Levinstein subsidiary Aquarius.
Ashdar says its deal with the Yavne Cooperative Society can go ahead, since the society fulfills the threshold conditions stipulated by the HCG - ILA and municipal building plan approval by November 15, 2001. Ashdar general manager Shraga Waseman told "Globes", "The ruling will cause chaos in agricultural policy, and lead within a year to a shortage in land for construction. Kibbutzim and moshavim land makes up a large proportion on land designated for construction."
Azorim will call off four deals: Kibbutz Harel and Kibbutz Geniger (150 houses each), Kibbutz Hamaapil (140 houses), and Kibbutz Kiryat Anavim (138 houses). Like most of the other companies in the sector, Azorim did not pay for the land in cash. The contracts stipulated that after all necessary approvals are obtained, the company and the kibbutz would set up a business partnership for developing the land, with the kibbutz receiving a percentage of the sales proceeds.
On the other hand, Delek Real Estate, also very active in this business, will be practically unaffected, since the company has already obtained ILA approval. Furthermore, some of its deals were under Resolution 611, which is still valid. Among other things, Delek Real Estate plans to construct a large residential neighborhood on land belonging to Moshav Even Sapir, near the Hadassah Hospital, Ein Kerem, Jerusalem, and on land belonging to other moshavim and kibbutzim in the region.
The company managers told "Globes" at the end of last week that the deals would only be implemented if the Knesset enacts the proposed law transferring ownership of agricultural land to the farmers, enabling them to sell it.
Published by Globes [online] - www.globes.co.il - on September 1, 2002