The Rassco company is selling its ownership in the former Ministry of Foreign Affairs site in Jerusalem. The Aviv group, controlled by Doron Aviv and Dafna Harlev, and Leny Group, controlled by founder and CEO Rudy Gabsi, acquired the last parcel of land in the Mishkanot Hauma neighborhood, zoned for construction of 266 apartments. The companies will pay Rassco NIS 160 million in cash for half of the land, while the remainder will be paid with 25% of the proceeds from the sale of the apartments.
The 11-dunam (2.75-acre) site was purchased by Isras (TASE: ISRS), Rassco's parent company, in March 2013 in an Israel Land Authority (ILA) auction for NIS 200 million. NIS 40 million more was invested in it for development. Since then, however, the company made a strategic decision to cut back on its residential real estate activity and focus on income-producing real estate. Since 2016, Rassco has been negotiating to sell the land, after having already done digging and revetment work and obtained a building permit for the project.
The land is located in the eastern part of the Ministry of Foreign Affairs site on Yosef Burg Street, facing Gan Sacher and the Nachlaot neighborhood. The Mishkanot Hauma neighborhood is also close to the entrance to the city, the light railway station, and the newly opened International Convention Center (ICC) railway station for the high-speed railway to Tel Aviv.
Aviv and Leny Groups will begin work immediately, since the project already has a building permit. They will construct five 6-8 storey residential buildings according to construction in the existing neighborhood. Construction on the site has mostly been completed; hundreds of housing units have been built there by B. Yair (TASE: BYAR) and a number of purchasing groups.
The legal representatives in the deal were Adv. Ofer Noam from the Noam & Col law firm and Adv. Asaf Eylon and Adv. David Akrish from the Yigal Arnon law firm. The lending bank for the project is Israel Discount Bank (TASE: DSCT), represented by the Tadmor & Co. Yuval Levy & Co. law firm.
Published by Globes, Israel business news - en.globes.co.il - on November 11, 2018
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