Tenants have moved into the first Tel Aviv urban renewal project, called ME Tel Aviv. The site originally housed 96 apartments in old railway buildings in the Neve Sharett neighborhood near the Ramat hahayal high-tech industrial zone, which were demolished. Three 21-storey high-rises were built on the site with a total of 270 apartments - a ratio of 2.8 new apartments per old apartment.
The government zoned the site for urban renewal in 2002. Ashli, owned by Asher Alon, and S. Michaelson, owned by Ya'acov Apirion, began negotiating with the tenants in 2007, after contacts with other companies were unsuccessful, and the work was recently completed. One of the reasons why the project was carried out was the exemption from betterment tax that the Tel Aviv municipality granted to developers of urban renewal in the neighborhood.
30 of the 96 apartments were purchased by the development companies from tenants who did not believe that the project would ever be carried out. The owners of the other 66 old apartments received a new apartment for their old one. 80% of these owners were young investors, who have now received a nice exit for their apartments. Only 15 of the original families in the building remained on the site when the old buildings were demolished.
Those who bought apartments in the project four years ago have earned over NIS 700,000 on paper. When marketing began, a four-room apartment in the ME project cost NIS 1.67 million. According to Israel Tax Authority figures, the same apartment is now worth NIS 2.45 million 45%-50% more.
The ME project is the first in a series of urban renewal ventures in the Neve Sharett neighborhood in the construction stages. According to Eyal Zwas, the vice-president of the companies, "The old Neve Sharett of several years ago has been reborn. Most of the buildings in the old neighborhood has been replaced by modern homes, and access, roads, and infrastructure have been upgraded."
Published by Globes [online], Israel business news - www.globes-online.com - on November 18, 2015
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