WeWork to lease 4 floors in Tel Aviv tower

New Tel Aviv office tower Photo: Viewpoint
New Tel Aviv office tower Photo: Viewpoint

The company has an option to lease four more floors in the ToHa office tower.

Income-producing real estate companies Amot Investments Ltd. (TASE:AMOT) and Bayside Land Corp. Ltd.(Gav Yam) (TASE: BYSD1), partners in the ToHa office tower in central Tel Aviv, today announced that they had signed a memorandum of understanding for a lease with WeWork for four floors in the tower. WeWork builds and manages shared workspaces worldwide. Rent in the 15-year lease is believed to be NIS 300 million, and the tenant will have an extension option. "Globes" reported the negotiations between the parties several months ago.

Amot and Bayside announced that WeWork would rent 13,000 square meters and receive an option until the end of the year to rent four more floors in the project under the same terms. If this option is exercised, WeWork's offices will cover half of the rental space in the building. The tower's rental space totals 57,000 square meters, with 2,600-3,400 square meters on each floor.

Amot and Bayside said, "WeWork is known for bringing with it innovation and a dynamic and current work environment wherever it goes. We are proud that it has chosen to locate the main WeWork site in Israel in the ToHa project. This is a significant milestone in making the entire area the new high-tech center of metropolitan Tel Aviv."

Israeli Adam Neumann and Miguel Mckelvey founded WeWork in 2010. The company splits office space into rooms, and rents them out by the room, or even by the table, for short periods.

900 NIS million investment

The tower, located near the intersection of Hashalom Road and Yigal Alon Street in Tel Aviv, has 30 storeys, 1,000 parking spaces, and a commercial floor, with a nearby park. Investment in construction totaled NIS 900 million. In Amot's second quarter financial reports, the company reported the beginning of marketing the project and advanced negotiations with several international companies involving more than half of the project. The partnership is predicting that construction of the tower will be completed by the end of 2018. The ToHa tower is regarded as the partnership's leading project. The share price of Amot, controlled by Alony Hetz Property and Investments Ltd. (TASE: ALHE) and managed by CEO Avi Mosler, has climbed 35% since the beginning of the year, reflecting a NIS 6.5 billion market cap. The share price of Bayside, controlled by IDB Group subsidiary Property and Building Ltd. (TASE: PTBL) and managed by CEO Avi Jacobovitz, has gone up 25% during the period, pushing the company's market cap up to NIS 3.6 billion.

Other than the ToHa tower, now under construction, Amot and Bayside hold construction rights for another nearby 70-storey tower on Yigal Alon Street. The two companies also reported in recent months that the plan for constructing this tower was being promoted in the planning and building commissions, and that they were taking steps to have the construction rights increased.

Published by Globes [online], Israel Business News - www.globes-online.com - on November 6, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

New Tel Aviv office tower Photo: Viewpoint
New Tel Aviv office tower Photo: Viewpoint
Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018