Sources inform ''Globes'' that New City Ltd. is in talks with Tidhar Ltd. to become a partner in the Assuta project in north Tel Aviv. New City has not yet bought the sight from Boymelgreen Capital Ltd. (TASE:BMGN), after getting an extension to its option until October 31, in exchange for a higher price. If New City exercises the option, it will pay NIS 356.7 million, plus VAT, for the land on Jabotinsky Street on the site of the old Assuta Hospital.
New City is a buyer's group headed by Raviv Zoller and Dror Halevy, whose members include Minister of Defense Ehud Barak, Bank Leumi president and CEO Galia Maor, and Mizrahi Tefahot Bank president and CEO Eli Yones.
The sources said that New City is also in talks with other developers, and that the talks apparently reflect New City's difficulties in obtaining bank financing for the project. The sources added that Bank Leumi (TASE: LUMI) will probably finance the project, but that it is demanding a strong partner with independent capital, which will be responsible for development, oversee construction, subcontractors, the pricing of the apartments, and provide customer services. The model for the Assuta project is New City and Tidhar's collaboration on the Central Park project for high-tech entrepreneurs in Tel Aviv.
In effect, New City's sole role in the Assuta project will be to bring in the buyers group. The company says that has completed the group, numbering 155 buyers
In an unrelated matter, Tidhar bought a lot in Givatayim on which it will build a 225-unit project. The company estimates the proceeds at NIS 500 million, or an average of NIS 2.22 million per apartment.
Published by Globes [online], Israel business news - www.globes-online.com - on August 1, 2010
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