The Israel Journalists Association today closed a major deal for the sale of Beit Sokolov (Journalists House) in central Tel Aviv for NIS 172 million. The buyers, Reality Real Estate Fund (67%) and The Phoenix Holdings Ltd. (TASE: PHOE1;PHOE5) (33%), undertook to pay the Journalists Association up to NIS 8 million more if rights in the site are increased.
Construction rights in Journalists House total 14,000 sq.m. The Urban Building Plan for the site provides for the construction of 17 storys, plus commercial and parking space. Under the deal, the Journalists Association retains rights to 3,600 sq.m. on the ground floor in the building next to the street, which is marked for preservation.
The Reality Fund and Phoenix overcame 12 other bidders, after 24 companies acquired the tender documents. Gindi Holdings was second with a higher bid of NIS 175 million that did not, however, include any undertakings for additional construction rights. Developer Yossi Avrahami and Aviv Group bid NIS 170 million and NIS 165 million, respectively. Teddy Sagi, who was also interested in the project, bid NIS 100 million less than the winner.
Following the deal, the Journalists Association quickly paid a NIS 27.3 million debt to Israel Land Authority (ILA), leaving the Association with the bulk of its proceeds from the sale. Its lease for the site expired in 1999, and its status in the property has been a non-contractual resident ever since, with a debt that mushroomed to the amount that has now been paid.
Published by Globes [online], Israel business news - www.globes-online.com - on April 29, 2015
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