Green light for Rotshtein's mega-project in Hadera: expected revenues of ₪1.74 billion

Rotshtein Realestate announces the launch of the evacuation-building project in the Sela Betar complex in Hadera, after vacating 190 existing housing units. In their place, approximately 1,452 new apartments and billions in commercial space will be built.

Rotshtein Realestate reported the fulfillment of the conditions precedent for its flagship urban renewal project at the Sela Betar complex in Hadera. Following the evacuation of all 190 apartment owners and taking possession of the land, the company and its partners are moving forward to execute a project that will include the demolition of old buildings and the construction of about 1,452 new apartments and 24,000 square meters of commercial and employment space. Total expected revenues from the project are estimated at approximately ₪1.74 billion, with Rotshtein's share standing at about ₪696 million.

Real estate company Rotshtein reported today (Tuesday) significant progress in the large-scale evacuation-building project it is advancing in the Sela Betar complex in Hadera. The company announced that all conditions precedent required for the project's launch have been met, foremost among them the evacuation of all 190 existing housing units in the complex and the acquisition of full possession of the land. This development constitutes a critical milestone and allows the company and its partners in the joint venture to begin demolition and construction work.

As part of the project, planned to be executed in three phases, the old buildings will be demolished and replaced by approximately 1,452 new housing units. In addition, the project will include the construction of about 24,000 square meters of commercial and employment space intended for marketing. This is one of the largest urban renewal projects in the region, expected to transform the neighborhood.

According to the company's preliminary estimates, based on a zero-report prepared for the project, the total expected revenue from it stands at approximately ₪1.74 billion (excluding VAT). Rotshtein's share in the project, which includes 505 housing units, is expected to generate revenues of about ₪696 million for the company. On the expense side, the total costs of the project are estimated at approximately ₪1.5 billion, with Rotshtein's share of the costs being about ₪602 million. These figures reflect an expected gross profit of about ₪94 million for the company from the project.

The revenue estimates are based on an expected price range of 22 to 26 thousand shekels per square meter (including VAT) for typical apartments, and 27 to 34 thousand shekels per square meter for special apartments. The company emphasizes in its filing that this is forward-looking information, and the final revenues and costs may vary, inter alia, depending on external factors beyond its control, such as changes in construction costs and the state of the real estate market. The company also notes that the data are based on the assumption that an additional combination agreement will be signed with rights holders in the complex, a move currently under negotiation.