Azrieli does not fear rivals

Danna Azrieli Photo: PR

Azrieli chair Danna Azrieli tells "Globes" about her company's massive building plans in Tel Aviv and why she relishes the competition from WeWork and Amazon.

The area around Hashalom railway station in the heart of Tel Aviv has become something of an "Azrieli neighborhood." There is of course the iconic Azrieli Center with its round, square and triangular high-rise office towers above the shopping mall. Recently opened, slightly to the south, is the Azrieli Sarona tower, the country's tallest building, 3.5 meters higher than the previous highest building, the Moshe Aviv in Ramat Gan.

Immediately to the north of the Azrieli Center, a fourth 90-floor tower is under construction on the site of the former Yediot Ahronot offices, which will become the country's tallest building when completed. And to the north of that the 80-floor Azrieli Town building for apartments and offices will be built on the site of the former Kupat Holim health fund building.

"Globes" visited the "Azrieli neighborhood" to speak to Azrieli Group Ltd. (TASE: AZRG) chair Danna Azrieli, who took over the reins of the company after her father David Azrieli died in 2014.

Does the amount that you are building give you the power to dictate things to the Tel Aviv municipality?

Azrieli said, "God forbid. Maybe 40 years ago that sort of thing might have happened but today you have to build beautiful. We are on the same side as the municipality."

Are you not bothered by the vast amount of construction in the Greater Tel Aviv region?

"When we said we were building the Sarona tower people told us we were mad. But we had 95% occupancy arranged before we completed construction. I'm in favor of there being a lot of construction in Israel and I think that people do not understand how strong the Israeli market and the Israeli economy are."

She added, "We offer unique buildings that appeal to young high-tech employees. We offer modern designs combined with the traditional and give people that bit extra like the possibility of bringing their dogs to work with them."

Nor does she fear her rivals. "Because we have history, professionalism, and financial strength, I think that companies prefer to work with us. We have a track record that other developers do not have.

Azrieli points out that other projects in the Tel Aviv region are being developed by buyers groups. She said, "Somebody who wants to rent 1,000 square meters won't go to a buyers group. International companies don't want to work with 10 different landlords."

Azrieli does not fear the emergence of WeWork and other share workspace developers. Indeed, there is an element of cooperation with Teddy Sagi leasing the top eight floors of Azrieli Sarona tower in order to lease to tenants not interested in committing to longer-term leases. Danna Azrieli said, "I see these workspaces belonging to companies like WeWork and others as an opportunity to learn and to improve. It makes me think but it doesn't make me stop building. Perhaps I can learn to create a different product with space for seminars for young people, kitchens, meeting rooms etc."

Nor does Azrieli, which operates the country's best known chain of shopping malls, fear Amazon. "They lease from us for their R&D operations. But the competition by Amazon in retail makes us improve. We are not closing our eyes to this. Digital operations exist but it won't be without physical operations and I very much believe in integrating both worlds. I learn from everybody. After all Amazon themselves opened two bookshops in Los Angeles and bought Whole Food's stores."

Published by Globes [online], Israel business news - www.globes-online.com - on January 2, 2018

© Copyright of Globes Publisher Itonut (1983) Ltd. 2018

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Danna Azrieli Photo: PR
Danna Azrieli Photo: PR
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