Land Prices in Beit She'em Deflated by 60% Due to High Development Costs
Translated & summarized from Ice by baba
A tender for residential construction in Beit She'em's Neve Shamir neighborhood resulted in a winning bid over 60% lower than the assessed land value, due to high development costs. The project, intended for the Haredi public, will feature 4,659 apartments and commercial spaces. Developers factor in total unit costs, leading to lower land bids when development expenses increase.
The story in 5 lines · by baba
- A Beit She'em land tender saw prices drop by over 60% due to high development costs.
- The winning bid for the Neve Shamir neighborhood project was approximately 22.7 million shekels.
- Assessed land value stood at 59.4 million shekels, with development costs exceeding 90 million shekels.
- The project is part of the Ramat Beit She'em plan, aiming for 4,659 apartments.
- The tender was specifically designed for the Haredi community.
A recent tender for residential construction in Beit She'em's Neve Shamir neighborhood, intended for the Haredi public, saw a significant drop in land prices, with the winning bid falling by over 60% compared to the assessed value. The winning bid from Urbana B. Halevy was approximately 22.7 million shekels for the land, while development costs are expected to exceed 90 million shekels. The assessed land value was 59.4 million shekels, meaning the final price was over 36 million shekels lower.
This substantial reduction is attributed to high development expenses, which compel developers to submit lower bids. Developers calculate the total cost per housing unit, and when development costs rise, the land price bid decreases accordingly. The tender was for a project featuring residential buildings and commercial/employment spaces designed for the Haredi community.
Despite the reduced land price, the project is part of the Ramat Beit She'em plan, a large neighborhood in southern Beit She'em spanning about 1,060 dunams. This area is slated to include approximately 4,659 apartments in buildings ranging from 4 to 9 stories, with some commercial frontages along the main street and slopes facing the Ella Valley. The second-highest bid in the tender was 18.7 million shekels, highlighting the impact of development costs on the final land price.
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