Jerusalem Contractor Neta Lipschitz Seeks Receiver Amid 60 Million Shekel Debt

The veteran Jerusalem construction company, Neta Lipschitz, has filed a request for the appointment of a temporary receiver and a stay of proceedings to facilitate its economic rehabilitation. The company is reportedly facing debts exceeding 60 million shekels, excluding a 29 million shekel debt to its shareholders. The application, submitted by attorneys Shelly Nachum and Ilan Gelman, states that the company owes approximately 44 million shekels to hundreds of suppliers and subcontractors.

Founded in 1997, Neta Lipschitz has operated for three decades in residential construction, primarily in Jerusalem, and is registered as a contractor with unlimited financial scope. The company claims it was profitable and stable until the outbreak of the "Swords of Iron" war, with 2023 revenues reaching about 142 million shekels. The war, according to the company, caused severe labor shortages, construction site shutdowns, and a more than 30% drop in productivity, compounded by old contracts that did not account for rising construction costs.

Neta Lipschitz currently has one active project, "Ganei HaYovel" in Jerusalem's Kiryat HaYovel neighborhood, which involves five buildings with 226 housing units, a kindergarten, and commercial spaces. The project is reportedly 80% complete, with an expected remaining revenue of 75 million shekels. The company warns that halting work on this project would lead to its abandonment, forfeiture of the remaining revenue, and significant losses for creditors.

Other projects, including those in Beit Vitenberg, Moradot Gilo, and MeKore Chaim, are either completed or nearing completion and are in their warranty periods. The company's liabilities include a secured debt of 15.4 million shekels to Bank Hapoalim, the 44 million shekel debt to suppliers and subcontractors, 2.4 million shekels in unpaid wages, hundreds of thousands in debts to authorities, and the 29.1 million shekel owner loans.

Despite its financial difficulties, the company asserts it remains a "living business" with a viable active project, a professional team, and decades of reputation. It argues that supervised operation will yield higher returns for creditors than liquidation, prevent the forfeiture of 27.6 million shekels in sales law guarantees, protect apartment buyers, and preserve jobs for its 45 employees. The company's shareholders are Nathan Neta Lipschitz (75%) and Yaakov Yosef Lipschitz (25%). Attorney Shelly Nachum stated that the company was severely impacted by the pandemic and the "Swords of Iron" war and chose rehabilitation over liquidation to protect stakeholders and oversee the completion of the "Ganei HaYovel" project.