Sources inform ''Globes'' that the liquidators of Hatzlahat Yehezkel are negotiating to sell Hatzlahaht Yehezkel subsidiary Darom Yehuda, which owns four income-producing properties, for $35 million.
The first property is a 6.5-dunam (1.625-acre) lot in west Rishon LeZion occupied by a 2,900-sq.m. commercial building leased to DIY chain ACE Marketing Chains (ACE Israel). ACE's lease ends soon and the branch will probably move to another power center also owned by Darom Yehuda. Darom Yehuda is negotiating to lease the property to a large fashion chain at $16 per sq.m. per month in a ten-year lease. The lot has unused rights to build an additional 5,800 sq.m. on two floors. The property's value has been assessed at $3.5 million.
The second property is a 20,000-sq.m. power center on a 30-dunam (7.5-acre) lot, adjacent to the commercial property, presently leased to ACE. The power center is fully leased to Cosmos supermarket, DIY chain Home Center, and fashion chains. This two-storey power center has an agreement with the Rishon LeZion municipality for the construction of 25,000 sq.m. of office space. Assessors estimate the value of the power center at $35 million.
The third property is another power center on a 35-dunam (8.75-acre) lot on Avraham Bar St. in the new Rishon LeZion industrial zone. The 18,000-sq.m. first stage of the power center is being built at an estimated cost of $15 million. Bank Otsar Hahayal Ltd. is providing financial coverage for the project. Darom Yehuda has leased 80% of the space to six chains, including Co-Op Blue Square Consumer Cooperative Society (Co-Op) and ACE.
The liquidators have a signed contract with Globus Group, under which the latter will rent the 15,000-sq.m. second stage of the power center for 18 cinemas, at $12 per sq.m. per month, in a 14-year lease. The assessors estimate the value of the full power center at $18 million, plus another $8 million for the Globus Group lease.
The fourth property is a 440-sq.m. neighborhood commercial center on a 1.2-dunam (0.3-acre) lot in Neve Dekalim in Rishon LeZion, estimated to be worth about $500,000.
Darom Yehuda has heavy debts to the banks, Rishon LeZion municipality, contractors, architects and others. The net value of the company is estimated at $35 million.
Published by Globes [online], Israel business news - www.globes.co.il - on July 3, 2005