. Sources inform ''Globes'' that Gazit-Globe Ltd. (TASE:GLOB) subsidiary Gazit-Globe Israel Ltd. is negotiating to buy 25,000 sq.m. of commercial space in the Tel Aviv wholesale market. Gazit-Globe will reportedly pay $25 million if a deal is signed.
The Tel Aviv Local Planning and Building Commission recently rezoned the 55-dunam (13.75-acre) Tel Aviv wholesale market for mixed-use project, including 2,000 apartments, 15,000 sq.m. of office space, 25,000 sq.m. of commercial space, and 1,500 underground parking places. The site will have ten-storey buildings above the commercial center, and four 40-storey resoidential high-rises.
The Tel Aviv municipality owns 40% of the planned commercial space on the lot. Gazit-Globe is therefore negotiating with both the municipality and the Tel Aviv Wholesale Market Cold Storage Ltd. In addition, because the office towers will be built over the commercial center and the parking lot will be common to both projects, Gazit Globe will also have to negotiate with a third party - the developer for the residential project.
The Tel Aviv municipality prefers selling rights to the lot to ten developers who will build and market the apartments simultaneously, rather than selling the rights to a single developer, who would develop the project over many years. Market sources believe that the project’s proceeds will reach $600-700 million.
Gazit-Globe said in response that it was constantly seeking commercial centers in Israel, in line with the company’s policy, and it did not normally comment about negotiations before a deal was signed.
Published by Globes [online], Israel business news - www.globes.co.il - on January 8, 2006