Israeli website building company Wix.com Ltd. (NASDAQ: Wix) is offering 7,000 square meters of commercial and office space on its Glilot campus at a rent much higher than you pay for the space, sources close to the matter told Globes.
Information obtained by Globes reveals that Wix is paying NIS 90 per square meter and is looking to sublease the space that remains vacant for NIS 150-220 per square meter.
Flexible agreement adjusted to the changing market
Wix is looking to lease 5,000 square meters of office space, with just over 1,200 square meters on each of its four floors, for NIS 150 per square metre. In addition, Wix offers 2,000 square meters of commercial space for different types of stores at a price of 220 shekels per square meter.
Wix only offers two-year leases to give them more flexibility. If the tech market returns to strong growth, it will have room to expand while if it continues to slow down, it can rent out the space again on another short-term lease.
“It’s not easy to find tenants at these prices.”
If Wix can find renters at those prices, that would be a huge financial boost for the company, but it’s questionable whether there are contractors for these rentals.
“Glilot Junction is where the campus is located,” said Itai Shafran, CEO of getStatus, a real estate consultancy, “is the ‘crossroads of the state,’ and it’s the most central place there. The problem is that there is currently no access to campus, in the sense of mass transit systems, and that’s a very important aspect for offices, certainly today when we see protests and roadblocks passing by so close to the railways.”
He added, “This means that finding tenants for the space that Wix is offering now, certainly at current prices, will not be easy. We must remember that within a year, the Big Fashion Gillot complex will open nearby, and near the Cinema City complex, which already has space for rent. The prices that Wix asks are typical for the northern area of Tel Aviv, which is the area currently most in demand for the entire project, with the advantage of high visibility. Get high prices today.”
In 2019, Wix signed a 10-year lease with Canada and Israel for the new campus with three options to extend it. Canada-Israel is building the campus with its seven 10-story buildings and five floors of underground parking at a cost of NIS 1.5 billion.
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In the first phase, 30,000 square meters – three buildings – have been occupied, with the second phase to be completed within two years, during which 1,600 employees will work on campus.
Published by Globes, Israel business news – en.globes.co.il – on Jul 20, 2023.
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