State proposes Caesarea Foundation offer "buyer price" homes

Caesarea  photo: Moshe Shai
Caesarea photo: Moshe Shai

The Israel Land Authority asserts that the Foundation owes it tens of millions of shekels.

Representatives of the state and the Rothschild Caesarea Foundation recently discussed a proposal that hundreds of buyer fixed price housing units be marketed in the Or Yam neighborhood being built by the Foundation and the Or Akiva municipality. Informed sources told "Globes" that the Foundation had proposed the idea in the framework of attempts to reach agreement, following the Israel Land Authority's (ILA) demand that the Rothschild Caesarea Foundation pay debts amounting to tens of millions of shekels.

According to the proposal, the cost of subsidizing the apartments to be marketed on buyer fixed price terms will be deducted from the debt. The Rothschild Caesarea Foundation told "Globes," "ILA made no proposal to market the apartments on buyer fixed price terms," and that the fund owed no money to the state. Sources in the Foundation told "Globes" that it would not negotiate with the state through a newspaper.

The Caesarea Development Company, a subsidiary of the Rothschild Caesarea Foundation, is building the Or Yam project on 1,000 dunam (250 acres) in the Or Akiva jurisdiction, between Highway 4 and the coastal road. 3,500 housing units are slated for construction in the project - one of the largest in Israel outside of the Greater Tel Aviv area. Some of the housing units are in 15-storey residential towers, and some are private dwellings.

The Rothschild Caesarea Foundation owns most of the land zoned for the project, but the state also has rights in it. Marketing of the housing units is slated to begin immediately after the Passover holiday, after the Haifa District Planning and Building Commission approved the project last summer.

ILA is demanding over NIS 100 million in annual leasing fees from the Rothschild Caesarea Foundation, based on an internal opinion. According to the state's calculation, the cost of subsidizing the land under buyer fixed price plan terms is estimated at NIS 140,000 per housing unit. Simple arithmetic shows that the alleged debt can be deducted from the marketing of 700-800 housing units under buyer fixed price terms.

The Rothschild Caesarea Foundation was founded by the state and the Rothschild family in 1962. The agreement states that the Foundation's profits will be used for the development of higher education in Israel, and the leasing and ownership rights to 30,000 dunam (7,500 acres) in the Caesarea area were transferred to the Foundation for this purpose, in addition to ownership of the Caesarea Development Company. Another subsidiary, the Caesarea Assets Company, was later founded. Minister of Finance (later Prime Minister) Levi Eshkol granted the foundation a tax exemption, which was canceled early this century.

In 1989, the agreement between the state and the Rothschild family was extended until 2022, this time by then-Minister of Finance Shimon Peres. The Foundation asserts that Peres promised that the state would enact legislation anchoring its tax exemption.

The Rothschild Caesarea Foundation's assets were valued at NIS 1.3 billion in 2010. The Foundation had NIS 476 million in cash at the end of that year, of which it donated NIS 21 million.

Published by Globes [online], Israel Business News - www.globes-online.com - on March 28, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

Caesarea  photo: Moshe Shai
Caesarea photo: Moshe Shai
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