As the rich get richer.. / Shamoon will make $100 million on rezoning
Jewish-Portuguese billionaire Sami Shamoon is about to get even richer. Agricultural lands near Ramat Hahayal held by his firm Yakhin Hakal have recently been rezoned for residential use.
The Jewish-Portuguese billionaire Sami Shamoon is about to get even richer. Agricultural lands near Ramat Hahayal held by his firm Yakhin Hakal have recently been rezoned for residential use. Rumor has it that 1,200 residential units are earmarked for construction, and the resulting increase in the value of the land will earn Shamoon about $100 million.
According to past media reports, Shamoon has insistently pressed to change the zoning of land leased by Yakhin Hakal, rezoning he claimed was promised by Ariel Sharon. This week, however, Shamoon said "I have never requested any rezoning of the land. I'm planting pomegranates in Tel Mond now."
And the Tel Aviv District Zoning Plan was recently approved. According to the plan, a large portion of the 140 dunams leased by Shamoon from the Lands Administration in the area south of the Halacha interchange on Geha Road, and next to the Atidim high-tech campus, is to be licensed for residential construction. An additional chunk of land of a yet unknown size will be allocated for a park.
An estimated 1,000 to 1,200 apartments can be constructed on the area, and the value of the land after development will reach about $150 million, if the local zoning plan is indeed approved. Under current usage licensing, the land is valued at bout $14 million, and the constructed project can be expected to reach about $0.5 billion.
Shamoon holds these, and more than 12,000 dunams of what in the past was mainly citrus orchards, through Yakhin Hakal, which he acquired in 1992 from its former owners, the Histadrut Labor Federation and the Jewish Agency. The lands, which have been the focus of many disputes, are leased from the Israel Lands Administration.
When Shamoon acquired Yakhin Hakal, it was a company on the verge of collapse, with extensive debt. Shamoon says that he bought the company after being promised by Ariel Sharon, then Construction and Housing minister, and Micky Vardi, who chaired the Israel Lands Council at the time, that he would receive various benefits upon renewal of the land leases.
The most unusual of these promises to Shamoon was the right to develop the land, including rezoning for construction. Current procedures require that the land be repossessed by the Lands Administration before rezoning, and re-leased through a tender.
In May 2005, the Israel Lands Council - the authority that dictates Lands Administration policy - extended Shamoon's lease contracts to 2010. This decision will apparently allow Shamoon to develop various enterprises on the land. Many saw the move as a state surrender to magnates.