Migdal to develop 45-floor Ramat Gan tower

Elite Junction Ramat Gan

Migdal will invest NIS 800 million in building a 45-floor office and commercial tower on the Elite Junction by the Diamond Exchange.

Migdal Insurance and Financial Holdings Ltd. (TASE: MGDL) is reinforcing its real estate portfolio by promoting construction of an office  tower at the Elite Junction in Ramat Gan. Migdal signed an agreement to buy the lot, zoned for construction of Migdal Elite Tower in the Ramat Gan Diamond Exchange compound, from a group of diamond dealers for NIS 325 million. The company estimates the cost of the project at NIS 800 million. Construction will begin in the coming months and take five years.

The project is part of the Elite complex, which includes a 58-storey residential tower owned by Azorim, a large public space, and the historic Elite chocolate factory (now Shenkar College of Engineering, Design and Art), a unique building marked for preservation. Many events involving this land have taken place in the past 15 years; even US President Donald Trump's name was linked to it.

US company Crescent Heights acquired all of the land in 2006, including Azorim's residential tower. The company announced that it would join Trump, who would participate in the project as a developer, and would give it his name - Trump Plaza Tower. The deal did not go through; instead, Azorim and a group of diamond dealers bought the site and divided it into two towers zoned for residences and offices. Azorim built its tower, and the diamond dealers' land remained at the level of digging and revetment permits.

Office space in the tower will total 62,500 square meters, while commercial space will total 3,000 square meters on two levels. Migdal will also have 500 parking places on five levels.

Prevailing rents in the area are NIS 80-90 per square meter in shell condition, a price that will give Migdal a 9% return, very high at this time, which probably shows that the price in the deal was low. The architect for the project is Yossi Sivan from the MYS architectural firm, and Efrati Madpis Project Management will manage the project.

This deal is the latest in a series recently signed by Migdal that have swelled the value of its real estate portfolio in Israel to over NIS 11.5 billion. Completion of construction on recent projects acquired by Migdal, such as the Eleph site in Rishon Lezion, the BBC Tower in Bnei Brak, and the Elite Tower, will bring the portfolio to NIS 13 billion.

Published by Globes, Israel business news - en.globes.co.il - on September 23, 2019

© Copyright of Globes Publisher Itonut (1983) Ltd. 2019

Elite Junction Ramat Gan
Elite Junction Ramat Gan
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