Two weeks after bids were submitted for the wholesale market site in Tel Aviv, the site's owners, headed by Tnuva and the Tel Aviv Municipality, will again meet the various bidders in an attempt to improve on the original bids.
A source close to the negotiations told "Globes" today, "The silence of the past two weeks says it all. The sellers set a very high threshold of expectations that tripped them up, and now they are finding it hard to meet it." Initial estimates were of a value of at least some $600 million for the entire site.
The 55 dunam (16 acre) site, between Carlebach Street, Hahashmonaim Street, and Menachem Begin Road, is zoned for 1,800 luxury apartments in four 40-storey towers and another five 12-storey buildings, around a large park. The development will also include 30,000 square meters of commercial space, 25,000 square meters of office space, and public buildings. The Tel Aviv Municipality owns 25% of the site, Tnuva Food Industries Ltd. owns 60%, Shraga Biran owns 6%, and wholesalers who used to operate there own the rest.
The main bidders for the lot are grouped in three consortia:
- Tidhar Ltd., Migdal Insurance and Financial Holdings Ltd. (TASE: MGDL), British-Israel Investments Ltd. (TASE: BRTS), and Habas HZ Investments Ltd. (TASE: HABS). Koby Rogovin has joined this consortium.
- Shikun u'Binui Holdings Ltd. (TASE: SKBN), Aviv & Co., Amot Investments Ltd. (TASE:AMOT), Eurocom Global Real Estate Ltd. (TASE: EGRE), and Canada-Israel Development Corporation, controlled by Assaf Tuchmayer and Barak Rosen.
- Moshe and Igal Gindi and Gindi Investments.
The sellers are finding it hard to declare a winner, although they have already held meetings with representatives of all the consortia. The difficulty mainly stems from the gap between their expectations and the prices offered. Because of this, as reported in "Globes", and in order not to shelve the tender again (a year ago, the tender was suspended because of the low bids), the sellers are now considering splitting the site and selling the mall and the towers areas separately.
The Wholesale Market company said in response, "Three bids have been received backed by bank guarantees. This is a large and complicated sale process, and the bids are being examined accordingly."
Published by Globes [online], Israel business news - www.globes-online.com - on December 13, 2009
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