Discount Bank has provided 156 million shekels of finance to complete acquisition of the land in Trigo Real Estate and CityEl Investments’ Florentin Square projectIn the past month approximately 30% of the rights in the project, representing more than 300 million, were marketed | Among the deals: A penthouse whose cost is estimated at approximately 16 million
10.07.18 | Aviad Bartov
About a month ago, Tel Aviv Municipality approved the master zoning plan of the Florentin Square project, after changing the zoning of the project on land bordered by Shalme Road, Herzl Street, Simtat HaShah and Abulafia Streets – into a mixed-use compound comprising residential, retail and employment uses. With the approval of the city zoning plan, a financing agreement was signed with Discount Bank to complete purchase of the rights in the compound on which the project will be constructed. The marketing of stage A of the project was completed in recent days. The companies have commenced sale of stage B and prices of the rights will rise by approximately 5%-7%.
The Trigo Real Estate and CityEl Investments Florentin Square compound, the first project to apply the principles of the new Tel Aviv Master Plan (TA5000), goes up a level: With urban zoning plan approval on the land located between Shalme, Herzl, Simtat HaShah and Abulafia streets, and the change in the designation of the land to that of a mixed-use compound, Discount Bank provided finance of 156 million for the purchase of the land.
As may be recalled, in August 2016, the Trigo Real Estate Group acquired land at 60 Shalme Street from Carmel Wineries and Leumi Bank for the sum of 117 million shekels. In so doing, it joined up in partnership with CityEl Investments, which owns land at 58 and 62 Shalme Street. In accordance with the transaction terms, upon approval of the zoning scheme the companies completed the consideration for the land.
At the time of its purchase, the land was zoned for light industry, offices and retail spaces, and the two companies began to promote a new urban zoning plan for the project, which would combine residential, retail and employment uses.
Following the change in the terms of the new zoning plan, the plan is to construct on the 6.5 dunam (65,000 sqm) lot 200 apartments, 4,500 sqm of employment space, and 2,330 sqm of retail spaces facing out onto the streets surrounding the project. The companies are now starting marketing of stage B, with prices rising by approximately 5%-7%.
The project was designed by Architect Ilan Pivko, and construction of the complex is expected to start in 2019, in the form of self-construction, with the total cost of constructing the project estimated at approximately 900 million.
On behalf of Discount Bank, the deal was led by Head of the Bank’s Business Division, Orit Elster, Tali Richman, Director of its Real Estate and Infrastructure Division, and Shirley Mishael, Business Banking Manager.
The person who represented Discount Bank in the financing transaction is Adv. Assaf Englard, Head of Banking and Finance at law firm Hamburger Evron & Co., and advocates Gilad Goni and Ori Shasho from the firm.
Ron Novotny, one of the owners of Trigo Real Estate, said that “receiving the financing from Discount Bank to complete the acquisition of rights in the compound, in a relatively short period of time, attests to the faith the Bank has in the project. We recognize a great demand for a new residential alternative in Tel Aviv, among the local population and beyond. Because of the Florentin neighborhood’s attractive location, and as a result of development of the infrastructure of the neighborhood in the framework of TA5000, and its adaptation to family living, it is estimated that further price increases will be seen in the area in the future, and those acquiring rights in the project are expected to enjoy the high betterment potential. We have completed marketing of stage A of the project whereby more than 30% of the rights were marketed, representing more than 60 apartments marketed for construction in the format of a purchasing group, including rights for construction of a penthouse at an estimated cost of about 16 million. We are embarking on stage B, in which rights will be offered for the construction of special apartments, including penthouses, mini-penthouses, garden apartments and more”.
Shirley Mishael, Business Manager in the Real Estate and Infrastructure Department at Discount Bank, said that “The Bank believes in the location of the project and the potential inherent in the Florentin area, which is undergoing regeneration. I am very happy about completion of the transaction to finance purchase of the land. Discount Bank considers it an important goal to be available to its clients and to be able to provide financing for the execution of complex deals within a short period of time”.