Luxury apartment market recovering
Contractors report of momentum in upper market segment, with higher demand, customers paying in cash and Belgium Jews replacing Russian buyers
Two recent examples of this trend are the sale of two apartments in Gindi Holding's G Tower in Tel Aviv: A flat on the eighth floor, measuring 265 square meters (2,852 square feet) in size, which was sold for NIS 9 million (about $2.3 million), and another apartment on the 15th floor measuring 243 square meters (2,615 square feet) in size, which was sold for NIS 10 million ($2.5 million).
In another deal, a 240 square meter (2,583 square feet) apartment was sold on the 24th floor of the Neve Tsedek by the Sea tower being built by Zemah Hamerman company and the Eurocom Group together with foreign investors, for NIS 10.5 million ($2.7 million). The apartment faces the sea and is equipped with furniture designed by Giorgio Armani.
Two weeks ago, Naveh Shuster's 29 Soutine St. project in Tel Aviv sold a 420 square meter (4,520 square feet) apartment with a 32 square meter (344 square feet) balcony on a top floor, for NIS 17.2 million ($4.63 million).
The luxury apartment market, which has been vigorously active between 2007 and October 2008, suffered a critical blow upon the start of the global financial crisis: Foreign buyers disappeared and entire projects depending on foreign money were unable to market themselves. In the past few months, the Israeli market has begun raising its head and sales figures are improving.
Udi Bash, CEO of BT Global Media, which engages in web marketing of Israeli projects for foreign residents, reports that a revival has been recorded since March and April this year among foreign residents as well.
"I am talking about a rise of hundreds of percents since March," says Bash. "Our data show that the interest in the past few months exceeds even the figures recorded in the good months of 2008."
Are these the same buyers from 2008?
"Several changes can be seen: The Russian audience, which was very active, nearly disappeared during the months of the crisis and did not return in the past months as well.
"The markets which did return are North America, England, Belgium, and the market of French speakers. The demand levels are different from those of 2008: The English market, for example, did not return to its level before the crisis, but the Belgian market, on the other hand, is very strong."
In order to illustrate the rise in the demand, Bash presents a recent example: "Forty different people expressed their interest in a luxury project marketed in Neve Tzedek in the first two months of the year. In the past month, the same project received more than 100 calls."
