One of the few positives to emerge from 2020 was the thaw of relations in the Middle East: In the span of a few months last fall, the United Arab Emirates, Sudan, Morocco and Bahrain agreed to establish diplomatic and economic ties with Israel. .
The move has had myriad regional implications, one of which has been a soaring real estate market in Israel’s cultural and commercial capital, Tel Aviv. For the first time, brokers representing the city’s superprime properties are able to woo high-end clients from the Gulf and beyond.
Tomer Fridman of Sotheby’s International Israel says the shock from prospective Arab buyers was immediately felt.
“At the time the treaties were signed, we saw tons of inquiries coming to Israel and also from Israel to the UAE. It’s been like a massive influx, ”says Fridman.
He and his colleagues are collaborating with brokerages in the United Arab Emirates, rather than directly connecting with potential buyers there. And their counterparts are doing the same with Israelis looking to buy in the Emirates.
For Gulf buyers, Fridman says, there has been interest in both developments and single-family homes, including a stunning 69,000-square-foot palace in Caesarea that is priced at $ 259 million, making it one of the most expensive homes in the world. .
The “royal style mansion” is adorned with marble columns, onyx mosaics, 14-karat gold trim and crystal chandeliers. It’s not like most Israeli design, says Fridman: Bauhaus, modernist, minimalist. But it is in keeping with the tastes of the Gulf.
“It’s very luxurious, very opulent, and it’s getting a lot of attention from Emirati buyers,” he says. “We have already had inquiries.”
In recent years, Tel Aviv has been ranked among the most expensive cities in the world, and the pandemic hasn’t slowed things down, with home sales hitting a three-year high in the third quarter.
With branches in London, New York, Mykonos and the French Riviera, luxury brokerage Beauchamp Estates opened its Tel Aviv office last year. Associate Director Matthew Bortnick says there has been a lot of interest from clients in the Gulf countries about residential and commercial properties.
“There is no doubt that announcements made by the UAE, Bahrain and Sudan regarding normalization under the Abraham Accords have been catalysts for increased interest in Israel’s premium real estate in these locations,” he says Bortnick.
Buyers from the Gulf countries have helped drive prices for Tel Aviv villas, mansions and penthouses well above $ 10 million, according to Mansion Global. And the resulting activity, while economically beneficial, will only put additional pressure on middle-class locals who hope they can afford a family home.
To date, much of the interest Bortnick has received has come from Arab diplomats looking for properties to serve as embassies and ambassadorial residences. “It is understandable that the diplomatic corps has rushed,” he says. “But so have companies that place staff here, as well as individuals.”
That includes wealthy Emirati families looking to buy trophy homes and vacation getaways.
“Tel Aviv’s relatively mild summers and diverse leisure and recreation scene are sure to appeal to Emiratis,” he says, “and it is much closer, geographically, than European resorts and destinations.”
The agency is also answering inquiries from Arab Airlines top management and young professionals who want a base of operations that offers world-class culture, nightlife and beach life like Tel Aviv.
A couple in their 30s are looking for a two-bedroom apartment with a doorman, gym and pool, says Bortnick. They are looking at Rothschild Boulevard, one of the most expensive streets in Tel Aviv, and they have budgeted between $ 2 million and $ 3 million.
Then there are the “exceptionally comprehensive reports” Beauchamp is receiving from the ultra-high net worth Emiratis.
“There is no maximum budget and the specification is impossible to define, but it must be unique and high spec,” says Bortnick. “That usually translates to penthouses, like HaYarkon 29, or big villas on Rothschild avenue or on the coast.”
One property Fridman is pointing to for Emirati buyers is a $ 65 million baroque penthouse in Tel Aviv that could put Versailles to shame: Located across from Royal Beach, the crown jewel atop the Sea One Tower has stylish furnishings. Imperio, a formal dining room with seating for 16, and floor-to-ceiling windows overlooking the Mediterranean.
Although it is the only part of the city that touches the water, Tel Aviv Beach was for a long time the last undeveloped stretch of the city. Now it is the “Golden Kilometer”, with a series of condominiums and luxury hotels. Real estate deals in the corridor have exceeded $ 1 billion in the last decade, according to the New York Times.
While the doors are opening to a lucrative new market, meeting their demands is no easy task: Emiratis are used to high-end villas and luxury skyscrapers in Dubai and Abu Dhabi, and they are looking for trophy properties at the same level or even higher.
Beauchamp is targeting a $ 30 million mega-penthouse on HaYarkon Street as his first luxury home in Israel to sell to a wealthy sheik or tycoon.
Designed by Israeli firm Bar Orion, the duplex at the top of HaYarkon 29 spans the 16th and 17th floors of the entire building. There is over 5,700 square feet of living space (accessed by private elevator, of course), while outside, a private rooftop terrace houses an infinity pool and hot tub, rooftop garden, and 360-degree views. Degrees from the city, the coast and the sea.
Jeremy Gee, managing director of Beauchamp Estates, sees Tel Aviv’s launching the penthouse sale as a legitimate alternative to Morocco, London or Marbella for Gulf vacationers.
“When one sheikh buys, another follows,” he says.
However, it’s not just about individual buyers: developers in the Emirates are also looking at Tel Aviv.
“Israel, and Tel Aviv in particular, is not exceptionally well served when it comes to high-end hotels, compared to other cities in the world,” says Bortnick. “Several Dubai-based hotel owners and operators have approached us looking for suitable properties and locations where they could open a five-star hotel.”
That means in the water, “or at most, a block back,” he says.
Port Tel Aviv, star architect Ilan Pivko’s combination of a 40-unit condo and five-star boutique hotel, will be less than 200 feet from the water when it opens in 2022. Designs range from one to four bedrooms, with prices ranging They start at $ 2 million.
One block away is the David Promenade Residences under construction, a 28-story tower managed by Kempinski Hotels. A duplex penthouse costs more than $ 46 million, according to the New York Times.
While the initial wave of interest comes from countries that have already established diplomatic relations with Israel, Bortnick says Beauchamp is also receiving interim inquiries from other parts of the Arab world.
“[They] they have been watching the growth of the Tel Aviv real estate market in recent years and want to buy as soon as the protocol allows them to do so. “
He is confident that the reciprocal housing boom will further boost the Middle East peace process.
“This is always a good thing when it comes to politics,” says Bortnick. “The more people that meet, socialize and work together, the better things will get.”
Originally appeared in Architectural Digest