YH Dimri Construction and Development, controlled by Yigal Dimri, and Yahalomit Peretz, controlled by developer David Peretz, have come out on top in a dramatic pricing procedure for the Haoman 17 site in south Tel Aviv. Their winning bid was NIS 355 million, not including VAT. The procedure was part of the liquidation of a partnership ordered by the Tel Aviv District Court, for which Adv. Shai Raveh was appointed receiver. The site is bordered by Salame Road on the north, Abarbanel Street on the east, a public park on the south, and Shalabim Street on the west. Part of the site is also on the other side of Shalabim Street. The land, which has 30 joint owners, currently contains 1-4-storey industrial buildings and workshops, most of which were built more than 50 years ago.
The site is on one of the most strategic locations in the 5000 Tel Aviv outline plan, which zones most of the area for business and housing in buildings of 8-15 storeys, with 80% for residence and 20% for business, and for what it calls a "new business center" with at least 20,000 square meters. This plan is only a general one, however; no new urban building plan has been approved yet for the site, so while it is clear that the site has potential, there is still no certainty about the construction heihgt. Appraiser Oded Haushner's assessment of the property for the receiver was therefore NIS 200 million.
The developers who took part in the auction apparently saw greater potential. Liquidation of the partnership was initiated by Yuvalim, controlled by Itzik Baruch, which holds a quarter of the site, and itself participated in the pricing procedure in partnership with Acro Real Estate. Another bidder was Reality Investment Fund.
The pricing procedure took a dramatic turn, with prices that soon forced the developers and their legal representatives to conduct frequent consultations. When the bids began to soar, Reality Investment Fund withdrew from the procedure, while YH Dimri Construction and Development and Yahalomit Peretz joined forces and stayed in the bidding in equal shares. Their eventual bid, which was a few million shekels higher than the last bid by Yuvalim and Acro Real Estate, gave them the victory.
Combination deals with some of the landowners
The notice to the Tel Aviv Stock Exchange by YH Dimri Construction and Development stated that combination deals with some of the landowners had been signed, or would be signed. This indicates that prior discussions took place between the companies' representatives and some of the landowners. YH Dimri added, "Completion of the sale and transferal of the proceeds to any of the individual sellers in the pricing procedure is contingent on court approval, which constitutes a condition precedent in the sale agreement. In accordance with the pricing procedure terms, each of the partners made a NIS 3 million deposit and undertook to complete payment of 10% of the proceeds soon after the winning the pricing procedure.
"The rest of the proceeds with be paid on the following date and according to the following terms: 25% within 30 days of court approval and 65% within 90 days of court approval (with bank financing given upon registration of a mortgage), plus differences for linkage to the Consumer Price Index. The company will promote a detailed plan under which it will be possible to obtain building permits in the future corresponding to general outline plan 5000. In view of this, the company is at present unable to estimate the final extent of the rights and the extent of investment required. Equity will finance 35% of the purchase and loans 65%."
Published by Globes, Israel business news - en.globes.co.il - on November 20, 2019
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