Tel Aviv prices are more expensive than Champs-Elysees

Tel Aviv prices are more expensive than Champs-Elysees

“Among the eleven apartments sold in the pre-sale of the Gat Rimon project in Park Mesilla in Tel Aviv (between Neve Zedek Market and Levinsky Market), ten of the buyers are foreign residents. There are Australians, English and French. Some of them have bought to live there.” “And some of them as vacation apartments,” YBOX CEO Yossi Turgeman tells Globes.

YBOX (TSE: YBOX), which operates in real estate development, urban renewal and income-generating properties, is traded on the Tel Aviv Stock Exchange with a market capitalization of NIS 404 million. 37 residential units were sold in its various projects in Tel Aviv in the third quarter of 2024.

The company’s president is Yehuda Gorsed, and businessman Yitzhak Tshuva and his son are parties to YBOX’s interest (through a company they control) after purchasing a 10% stake for NIS 20 million at the beginning of 2024. The two men have the option to buy an additional 4.3% stake for NIS 10 million. Fattal Holdings (1998) (TASE: FTAL) is also an interested party with an 8% stake.

How did you interest Tshuva in the deal?

“We have a project called The Scottish House, which is a beautiful building that will be preserved in Jaffa and will be converted into a boutique hotel. Tshuva’s grandson, Sher Elroy Tshuva, has a hotel called Bereh in the Golan Heights, and we met when I was there and made contact and agreed that they would run the hotel in Jaffa,” he said. So Yitzhak Tshuva heard about YBOX, made contact and decided to invest in the hotel company.”

How do you see the market situation in Tel Aviv?

“We have many projects in Tel Aviv, including quite a few urban renewal projects in Yad Eliyahu. We have delivered some buildings, some under construction and some under planning. In Yad Eliyahu, prices are in the range of NIS 37,000 – 45,000 per meter. Box There was a good recovery in the last quarter of last year, and I hope this trend continues at the beginning of this year.

In June 2022, the company bought Romano’s house in Tel Aviv for NIS 378 million. In August 2023, the Tel Aviv Municipality decided to preserve this cultural gem and transform the place into a municipally-owned building for public use. In return, 27 thousand square meters of building rights will be transferred to other YBOX projects: the Gat Raymond project adjacent to Beit Romano, and the Beit Brin and Hassan Arafa projects. According to the company’s presentation, the value of the transferred rights to the three projects amounts to about 725 million shekels, almost double the purchase price of Romano House. In order to transfer the rights, approval from the Tel Aviv District Committee is required, which, according to the company, is expected to be obtained in April 2025.







“Half of the money raised went to pay off debts.”

The company’s flagship project is Ghat Raymond, which is on pre-sale. “It’s near the Messila (railroad) park off Herzl and Nahalat Binyamin streets,” Turgeman says. “These are two beautiful 40-storey towers with 380 apartments in total, designed by architect Moshe Tzur.

“The first tower also contains a 200-room hotel in partnership with Fattal, which bought 50% of the hotel. The first tower will be ready in five years and is currently being sold internally, without massive marketing. We have started pre-sale at a price of NIS 85,000 per square meter. We have set Italian architect for interior design and the standard is completely different.

There was a boom in apartment sales in the summer, and now the Bank of Israel is putting pressure on financing companies that pay too little upon signing (10%) and the rest upon occupancy (90%). Could the party be over?

“We do not have 10%/90%. In the Jat Raymond project, the payment terms are 20% upon receipt of the permit, 20% upon completion of the structure, and 60% upon delivery. We will soon finish the excavation and construction work.” Excavation work there, and the rest is expected to be done in the next six months. The buyers paid 7% of the 20% for the project, with the support of Bank Leumi in cooperation with Mercantile Discount Bank.

“I’m proud of the Florentine Quartet”

The company recently completed raising NIS 130 million in bonds, with a demand of approximately NIS 344 million.

What will you do with the money you collected?

“Half of the capital raised went to pay off debts, and the rest to promote the project and ongoing activities. There are major urban renewal projects. For example, we have a project with 400 existing apartments and 1,400 new apartments in Bat Yam, and we are now in the early stages and are in negotiations with the municipality.” Regarding the master plan, we have 50% of the owners’ signatures there. There are new projects in Holon, Rishon LeZion and Lod.

“We, like other real estate companies, realized that land reserves are limited and that for large projects we need to spread our wings and go out, even outside Tel Aviv. In the past, we built in Hadera, Netanya and in Bat We have built the Golden Tower – 47 residential floors, in recent years We focused on Tel Aviv, and in the past two years we have strongly started building large projects.

What do you think about the freezing of Tama 38 in Tel Aviv?

“This all stems from considerations around improvement fees and we will have to find a solution for that. This has held back the whole process until the new plan. We have been able to open the permit files for the Tama 38 projects in Tel Aviv.

“I think the country’s entrepreneurial spirit is pushing the entire industry forward. There are development companies here with crazy ambitions. When you try to stop the new laws and decrees that are being imposed from every direction, whether it is property improvement fees imposed by the authorities and the state and all the regulations even permits Construction – ultimately affects the price per square meter of the apartment.

“This takes me back to the beginning of our interview when I told you that apartments are being marketed at 85,000 shekels per square metre, which is a really crazy price. And the prices on the Champs-Elysées in Paris are even lower.”

The price is high but the sales volume is small. It’s not like the sales that existed when I founded the Florentine Quartet.

“I’m proud of the quartet. Instead of the garages that were there, we brought a distinctive project to the area. Then we built a cohesive building project next to them, and now we’re in the process of getting a permit for another project. Next door, on Abarbanel Street, corner of Gvolut, it’s a component project Of 200 units designed by Geddy Bar Orian Architects we have not left the area since the Quartet.

According to reports, your gross profit is relatively low. What is the reason for this?

“In accounting, revenues are recognized according to the rate of progress. We are in a period where most projects are currently in their early stages and most of the company’s profitability has not yet been recognized. The company’s expected profit is one billion shekels in existing projects over the next five years.”

Published by Globes, Israel Business News – en.globes.co.il – on January 14, 2025.

© Copyright Globes Publisher Itonut (1983) Ltd., 2025.


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