Colombia Opens Jerusalem Embassy After Shmulik Apote Buys Property for $7.5 Million

Colombia officially inaugurated its embassy in Jerusalem last Wednesday, marking the tenth foreign embassy in the city. The seller was Nof Ha'park Hadas Capital, owned by businessman Hillel Zurivin. This sale occurred after the company had attempted to sell the property for about 15 million shekels for three years without success. An individual familiar with the deal noted that the current period of war and a low dollar exchange rate have reduced foreign buyer activity.

Shortly after acquiring the property, Apote finalized a long-term lease agreement with the Colombian Embassy, which will pay $17,000 per month. The lease, reportedly for five years with an option for another five, represents an annual income of $204,000 for Apote, totaling approximately $1.02 million over the initial five years. If the option is exercised, the total income could reach $2.04 million over ten years, assuming no rent increases and before expenses.

The embassy is situated in a traditional Jerusalem stone building, approximately 200 square meters with an additional 128 square meter courtyard, featuring two separate entrances. Appraiser Kobi Bir stated that the monthly rent of $17,000 suggests a property value significantly higher than the purchase price. Capitalizing the annual rent at a 2.5% yield implies a value of about 25 million shekels. However, Apote purchased the property through his company, Beit Orim Yizum Projectim, for approximately 9 million shekels, less than half of the value derived from the embassy's rent.

Bir believes the purchase price was low even considering the property's unique characteristics, central location, and size. He estimated the property's value to be between 14.6 million and 15.7 million shekels, several million more than Apote paid. He noted that embassy rentals often command a premium due to specific location, security, and operational requirements. A representative from Hadas Capital cited strict preservation limitations on the building as a factor affecting the sale. The building has a history of ownership by prominent Jerusalem families and real estate investors, including Teddy Kollek's former residence, which Apote also acquired previously.

Colombia's decision to move its embassy to Jerusalem carries significant political weight. The country had previously severed diplomatic ties with Israel during the previous administration of Gustavo Petro but restored them under the new president, Abelardo de la Espriella, who is known for his pro-Israel stance. For Prime Minister Benjamin Netanyahu, the opening of another foreign embassy in Jerusalem is a symbolic achievement, particularly in the pre-election period, bolstering Israel's diplomatic standing and Jerusalem's international status.