What will happen to the land of the former Sde Dov airport? After a long in-depth study with urban engineers and land experts, we have decided to withdraw the lands located in Sde Dov from sale.
The transformation of agricultural land into buildable zones represents a significant impact. Furthermore, this would lead to very heavy burdens for landowners. They will have to pay unknown taxes at this time that exceed comprehension.
The list of risks for acquiring the lands of the former airport:
- Land retention: The state (representing the IDF) may retain between 50% and 60% of the land. This would mean that an owner of 200 m2 would end up with only 100 m2 or less.
- Transformation taxes (ETHEL AHSBAHA): These are calculated based on the difference between the current price of the land according to its status (currently agricultural) and its future status, buildable.
- The Pitouah (urban development): For now, this amount remains completely unknown and could reach several hundred million shekels.
- Construction price: To date, the municipality has not yet launched a call for tenders for construction. Moreover, we do not yet know the construction price per m2, which could reach 11,000 NIS/m2:
The current value according to the Israeli land expert committee is: 2500 NIS/m2. Furthermore, the value once buildable would be 19,000 NIS/m2.
The calculation would therefore be 19,000 – 2500 = 16,500 NIS/m2
16,500 * 200 = 3,300,000 NIS. The tax would be 50% of this amount, which is: 1,650,000 NIS.
The owner will need to quickly pay this tax in order to sell or build their apartment.
Who could bear the prices in Sde Dov?
For a person who owns a plot of 200 m2, and hoping that they are left with 100 m2 net of land, which would give them a construction unit for a housing unit, the calculation would be as follows:
For the owner of a 200 m2 plot
Price of the plot: 850,000 NIS
Tax prices: 1,650,000
Urbanization: Unknown
Construction tax: Unknown
Construction: 1,100,000
Total: 3,600,000 NIS (before other taxes that are still unknown at this time)
Thus, the price could exceed 4 million shekels for 1 apartment of 100 m2. This price is calculated on the low side since the municipality will only communicate the tax prices once the status change is made.
In conclusion, we currently advise steering clear of this deal. Thus, avoiding giving our money to municipalities and other organizations without a return on investment on our side.
We add to this that this project remains entirely speculative and we are not in a position to guarantee its realization, neither the municipality nor the state.
It is preferable to invest today in “buildable” lands with permits, in developing areas where land prices have risen significantly over the last 5 years.
For example, in Netanya, between 2015 and 2019, the price of buildable land tripled; this investment carries no risk, nor unknowns during the transaction.
To learn about all our offers and profitable investment opportunities in Israel, Israland click here
