Sources inform "Globes" that French sporting goods retail chain Decathlon is in talks to rent the property in which the Rothschild-Allenby (on the corner of Rothschild Boulevard and Allenby Street) food market operated before its collapse. If the talks are successful, it will become Decathlon's first store in Tel Aviv and the chain's smallest store in the country.
The 2,000-square meter area is an amalgamation of two properties. One is the former Allenby-Rothschild market, owned by Berggruen Residential, managed by CEO Yigal Zemach. The other, which is much smaller, is owned by French businessperson Loren Amsalem. The owners are also negotiating with another tenant in the luxury segment.
A NIS 19 million debt
The Rothschild-Allenby market closed down last February after only one year of activity as a result of debt and a dispute between the partners: former Tiv Taam supermarket chain owner Kobi Tribitch (50%), former IKEA Israel CEO Shlomi Gabay (25%), and Eric Abramovich, owner of fish and meat importer Masterfood (25%). Tribitch later filed for bankruptcy after accumulating a NIS 19 million debt when the market collapsed.
In the months since then, various retail concerns have expressed interest in the site, including Rami Levy Hashikma Marketing (TASE: RMLI) controlling shareholder Rami Levy and Victory Supermarket Chain (TASE: VCTR) CEO and controlling shareholder Eyal Ravid, who wanted to set up branches of their chains in the location. These negotiations, however, were unsuccessful, mainly because of the complex structure of the site, which has a pedestrian passage in the middle that causes potential renters to lose interest because it is impossible to set up a continuous supermarket there.
Another disadvantage is site's lack of its own parking for out-of-town visitors to Tel Aviv. It is also alleged that the owners are asking for higher rent than food chains are willing to pay.
Contracts for opening two more stores
The area that Decathlon wants to rent in Tel Aviv is significantly smaller than its current store and those for which it has already signed leases. Decathlon's first store in Israel, which has 3,100 square meters, opened in Rishon Lezion just over a year ago. The company later signed leases to open two more stores: a 3,000-square meter store in the BIG Krayot center in Haifa and a 3,000-square meter store in Gazit Globe's (TASE: GZT) G mall in Kfar Saba. Decathlon is also expected to move its headquarters and offices to Kfar Saba.
Decathlon's trademark is its huge stores covering thousands of square meters and its competitive prices. Besides sports shoes and fashions, the especially wide variety of goods sold by the chain includes equipment for every branch of sports, including tennis and sea diving, and food supplements for athletes. Decathlon also has the Toboggan and Decat private brands, which offer products at discount prices.
In contrast to Europe, where Decathlon sells well-known international brands, as of now, Decathlon sells only its private products in Israel.
The opening of Decathlon's first Israeli store in September 2017 made Israel the chain's 34th country. Decathlon, founded in 1976 in the village of Englos near Lille, France, currently has 85,000 employees and 1,388 branches in 42 countries. The chain offers sporting goods in many categories at cheap prices.
Decathlon declined to respond to a query from "Globes."
Published by Globes [online], Israel business news - en.globes.co.il - on October 4, 2018
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