Tel Aviv Real Estate - August 12, 2005

After being stuck down under the Ramat Gan housing project finally received approval after fifteen years. The 980-unit housing project on privately owned land was finally approved by the Tel Aviv regional planning and building board in August 2005. The land extends to 235-dunams or over 58 acres. Plans include five 24-storey high rises with 600 apartments, 20 four-storey buildings and 200 garden or rooftop duplexes, 180 semidetached houses on 250 sqm lots, a 1,100-sq.m. neighborhood commercial center and a 30-dunam (7.5-acre) park. Proceeds from the project are estimated at several hundred million dollars.

The 400-unit seaside project at Tel aviv is under way. The project in north Tel Aviv is for mixed-residential hotel use. It will cover over 20 dunams of land and will include a complex of two 13-storey buildings with 400 75-sq.m. suites. Mixed use indicates that buyers of the suites may reside in them for six months a year, but must rent them out for holidaymakers for the other six months. Of the lots 98 have already been sold for $30 million to foreign residents and their relatives.

The disengagement plan has caused a demand for 1,700 new homes as evacuated families from the Gaza Strip and northern Samaria to seek new homes. While the demand for lots and homes in south had been very low until now, this government plan that has made this concept a reality. While the new demand is not expected to boost real estate prices in the south in the short term, the long term will paint a different picture with the arrival of hundreds of families with $2-4 million each that will probably benefit their communities. The short-term picture will stay unaffected because inventory of lots for construction and empty apartments greatly exceeds the expected demand. Communities in the south, desperate for new residents, will be the first to reap the benefits of the disengagement plan.