Harit Foundation Rock Capital Real Estate Continues to expand and acquires office and commercial properties in the center of the country for NIS 431.2 million plus VAT. The fund, managed by CEO Gadi Elikam and the chairman Shmuel SelvinReported today on an agreement to purchase 6 floors of offices and 90 and parking spaces in the northern four-tower in Tel Aviv, as well as the purchase of about 80% of a shopping center in Holon.
For the offices and parking floors, the fund will pay NIS 294.7 million plus VAT, while for the shopping center, an amount of NIS 136.5 million will be paid plus VAT. The amount of the consideration was determined in negotiations between the parties, and in respect of the purchase of the properties, Sela Real Estate is expected to pay purchase tax and related transaction expenses of approximately NIS 26 million.
The office floors to be purchased include the top six floors (floors 30-35) in the northern tower of the Towers of the Four Towers project, on 28 Arba Street. , With an option to extend the agreement by 5 to 10 years plus 3% -10% to the rent.
According to Sela Real Estate, the office floors currently generate a net income from rental activity (NOI) of about NIS 16.8 million. Thus, the rate of return on purchase is about 5.7%, while the rate of return on capital is about 10%.
“The Four Towers are modern and prestigious office towers characterized by an innovative design by the architect Moshe Tzur and designed by the super designer Giorgio Armani. The property is located, in the south of the Kirya in Tel Aviv (on 4th Street) in a central location for the business and entertainment areas of Tel Aviv. The property is located in the heart of the “Scooter Circle”, close to construction and development areas in Tel Aviv, Sharona complex, TLV complex and Ibn Gvirol St. The property has good access to Ayalon lanes and the center of Tel Aviv and is close to a light rail station. “In the area, there are new office buildings along with the potential for growth and the establishment of the area as a modern and advanced urban center,” Sela Real Estate emphasized.
Regarding the neighborhood commercial center in Holon, Sela Real Estate states that it is leased in full (100% occupancy rate) to about 30 different tenants, with an option to extend the agreements for periods of 3-9 years, with the rent linked to the consumer price index. Rent amounts to NIS 7.9 million per year, and represents a rate of return on purchases of about 5.7%.
The deal is being planned Rock Real Estate To finance from its own sources (the fund has cash reserves of approximately NIS 180 million), from the issuance of securities to the public and from the use of credit lines. Sela Real Estate was founded in 2008 as a real estate investment fund (REIT).
The fund owns 41 income-producing properties in Israel with a total area of approximately 480,000 square meters, including approximately 165,000 square meters of parking space. The company’s properties are leased to 530 tenants and include office buildings, commercial areas, industry and logistics, a hotel, a nursing hospital and a housing complex for rent. At the end of 2021, the value of the company’s income-producing assets amounts to approximately NIS 4.5 billion and its assets enjoy a high occupancy rate of approximately 98%.