The Marker, Adi Cohen, 25.01.2021
Demand for residential real estate has not been hurt by the Corona crisis - another huge deal has recently been completed in Tel Aviv: Acro Metropolis - a subsidiary of Acro Real Estate, owned by Tzachi Arbov, Ilan Kapon and Ziv Yaakovi - purchased the last lot in the Hassan Arafa business complex on Yitzhak Street A field in the city for NIS 340 million, and plans to build a 2770-unit residential tower there, TheMarker has learned.
This acquisition establishes Acro Real Estate 's hold on the complex. The company owns four additional lots in the complex in various partnerships.
Along with the controlling shareholders in the company, the shares are also owned by the Phoenix Insurance Company (25%) and the businesswoman Raya Strauss(13%) - who until 2005 shared the ownership of the family food giant Strauss with her brother Michael.
On the said land, which is spread over an area of 7.4 dunams in one of the most expensive land divisions in the southern part of the city, Acro is expected to build the only residential tower in the complex. Of the project is estimated at NIS 800 million.
Ilan Kapon (right), Tzachi Arbov and Ziv Yaakovi Photo: Rafi Daloia
However, the company is currently considering the possibility of increasing its rights in the complex, and it is expected to submit a request to the Tel Aviv Municipality for a significant increase in rights, which will increase the scope of current construction that the plan allows for dozens of additional housing units. If the said addition is approved by the municipality, the estimated cost of setting up the project is expected to cross the NIS 1 billion mark.
The huge deal, signed last Thursday between Acro Real Estate and the previous landowners - the Nazrian family and the Bauhaus company - is another step in the intensive renewal of the complex, which covers about 81 dunams. The municipality has been promoting a huge plan for its renewal for more than a decade, marking the Yitzhak Sadeh complex as one of the significant development centers in the south of the city, and as one of the main employment centers to be built in the area. Of offices alongside residential, hotel and commercial.
The huge deal is also another sign of the immunity shown by the residential real estate industry to the corona crisis, compared to the fragile volatility of the income-producing real estate sectors during this period. Only a few months ago, in the midst of the first closure at the beginning of the crisis, developer Moshe Yeshayahu, who owns several plots in the Yitzhak Sadeh complex, asked the Tel Aviv municipality to change its mix of rights. Yeshayahu justified his request - which is mainly a demand to increase the living space, along with a waiver of public space on the part of the municipality - with the severe upheaval experienced by the office industry since the outbreak of the plague, which he claims undermines the economic viability of projects.
Acro is currently completing the construction of the Alpha Tower , which includes 120 housing units next to a 180-room hotel, within the boundaries of the complex , as well as the construction of the Acro Tower , which has 37,000 square meters of employment space.
Simulation of the planned tower in the Hassan Arafa complex Photo: Danny Kaiser
Alongside these, Acro Real Estate is a partner in the construction of four additional towers to be built in the complex. About a year and a half ago, the company won a partnership with the Phoenix Insurance Company in a tender from the Israel Land Authority to purchase a 2,600 square meter plot for NIS 211 million. This, while a few months earlier, the company won another huge tender, in partnership with Phoenix and Yuvalim, for the purchase of three adjacent plots in the complex. The scope of the building rights in the four said complexes amounts according to the existing plans to about 80,000 square meters, most of which (75%) will be designated for employment, and the rest for residence.
Until its momentum of renewal in recent years, Hassan Arafa was a neglected garage complex rich in intruders and old workshops. Only with the crystallization of the complex's development plan in 2006, along with the promotion of adjacent plans on Begin Road, the wholesale market and the Kirya area, did the complex begin to attract the attention of large developers and investors in the real estate industry, who began to discover the economic potential inherent in it. The giants were the Nazarian family and the Bauhaus company, from which, as mentioned, Strauss now acquired and acruded the plot in question.
In 2008, the owners of the Bauhaus company, Yaakov Kotler and Amos Weinberger, teamed up with billionaire Yitzhak Nazarian - a Jew of Iranian descent living in Los Angeles - and purchased about a third of the area of the complex (about 27.7 dunams). This, in exchange for NIS 255 million. At the time, it was one of the largest deals in the office industry in Israel, signed in the midst of a global economic crisis.
Acro Real Estate confirmed the details, but no response was received.