Tel Aviv Residential Tower with 109 Unsold Units Highlights Stubborn Housing Prices
Two residential towers known as "Migdaley HaSolalim" at the entrance to Tel Aviv, developed by companies Mivne and Tadmor, illustrate the current challenges in Israel's housing market. Completed in early 2026, the project comprises 360 apartments across 33 floors. Despite 251 units being sold, 109 remain unsold six months after occupancy approval. Notably, 47 of the sold apartments were purchased last year in a bulk deal by the rental housing fund Magorit, accounting for over half of the 2025 sales.
The developers have refrained from significant price reductions, even as sales slowed dramatically in 2026, with only two apartments sold in Q2 compared to 23 quarterly sales in 2025 (half of which were to the rental fund). One recent sale was a 135.5 square meter apartment for 5.2 million shekels, maintaining stable prices per square meter. The reluctance to lower prices stems from the project's financial structure: total costs including land, development, construction, and financing reached approximately 844 million shekels, with sales revenue from 67% of the apartments already exceeding 974 million shekels, yielding over 100 million shekels in gross profit.
Mivne, holding 75% of the project, and Tadmor, 25%, report an expected gross profit margin of 40% despite one-third of the building remaining unsold. Mivne also maintains a strong cash position of 1.7 billion shekels and a debt ratio below 50%, reducing pressure from lenders. The developers attribute slow apartment handovers to buyers' preferences to delay taking possession until August, aligning with school schedules and avoiding management fees.
This case exemplifies why some developers can afford to wait rather than cut prices amid market uncertainty. The article also touches on broader real estate trends, including expansion by commercial giants into residential sectors and fluctuating real estate stocks, but emphasizes that many veteran developers with substantial reserves are not yet pressured by the current market slowdown.
