Urban Renewal Projects Lose Economic Viability Amid Rising Costs
Translated & summarized from N12 by baba
Eighty percent of Israel's urban renewal projects have become economically unviable, according to the Contractors Association. Previously profitable projects now yield single-digit returns due to rising construction and financing costs. Experts are analyzing the impact of these increased expenses on the sector's ability to proceed with developments.
The story in 4 lines · by baba
- 80% of urban renewal projects in Israel have lost economic viability.
- Projects that once yielded 13% profit now show single-digit returns.
- Rising construction and financing costs are cited as the primary reasons.
- Experts are analyzing the challenges for advancing these developments.
Eighty percent of urban renewal projects in Israel have lost their economic feasibility, according to data from the Contractors Association. Projects that previously yielded profits of 13% are now seeing single-digit returns. This decline is attributed to the rising costs of construction and financing, making it difficult to advance projects under current pricing conditions.
Advocates Ofir Cohen Konyuk, founder and owner of Cohen Konyuk & Co., and Ronit Shabiro, owner and chief legal advisor of Shabiro Group, are analyzing the impact of these increased expenses. They are examining the challenges faced in moving forward with these developments when prices are not keeping pace with the escalating costs. The situation highlights a significant downturn in a sector crucial for urban development and housing solutions.
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