One of the few positive things that emerged in 2020 was the thawing of relations in the Middle East: in a few months last fall, the United Arab Emirates, Sudan, Morocco and Bahrain agreed to establish diplomatic and economic relations with Israel.
The move had numerous regional implications, the least important of which was the increase in the real estate market in Israel’s cultural and commercial capital, Tel Aviv. For the first time, brokers representing the city’s superprime properties can court sophisticated clients from the Gulf and elsewhere.
Tomer Fridman, of Sotheby’s International Israel, says that the impact of potential Arab buyers was felt immediately.
“The minute they signed the treaties, we saw tons of investigations arriving in Israel and also from Israel to the United Arab Emirates. It has been a huge influx, ”says Fridman.
He and his colleagues are collaborating with brokers in the UAE, instead of connecting directly with potential buyers. And their counterparts are doing the same with Israelis who want to buy in the Emirates.
For Gulf buyers, Fridman says, there has been interest in both developments and single-family homes, including an impressive $ 259 million 69,000-square-foot palace in Caesarea, making it one of the most expensive homes in the world.
The “mansion in royal style” is decorated with marble columns, onyx mosaics, 14-carat gold frames 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 is very luxurious, very opulent – and it is receiving a lot of attention from buyers in the Emirates,” he says. “We have already received questions.”
In recent years, Tel Aviv has been ranked among the most expensive cities in the world – and the pandemic has not slowed things down, with home sales reaching the highest three-year high in the third quarter.
With branches in London, New York, Mykonos and the French Riviera, luxury brokerage Beauchamp Estates opened its office in Tel Aviv last year. Associate director Matthew Bortnick says there has been a lot of interest from customers in the Gulf countries about residential and commercial properties.
The HaYarkon 29 development, which is being marketed by Beauchamp Estates.
Beauchamp Estates
“There is no doubt that the announcements made by the United Arab Emirates, Bahrain and Sudan regarding normalization under the Abraham Agreements have been catalysts for increasing interest in Israel’s main properties in these locations,” said Bortnick.
Gulf country buyers have helped drive prices for Tel Aviv’s villas, mansions and penthouses well above the $ 10 million mark, according to Mansion Global. And the resulting activity, while economically beneficial, will only put additional pressure on middle-class locals who want to buy houses for their family.
So far, much of the interest that Bortnick has received has come from Arab diplomats looking for properties to serve as embassies and ambassador homes. “The diplomatic corps was understandably quick to respond,” he says. “But the same happened with companies that put employees here, as well as with private individuals.”
This includes wealthy Emirati families looking to buy trophy houses and vacation trips.
“Tel Aviv’s relatively mild summers and the diverse leisure and recreation scene are sure to attract the Emirates,” he says, “and it is much closer, geographically, than European resorts and destinations.”
The agency is also responding to inquiries from top management of Arab airlines and young professionals who want a base of operations that offers world-class culture, nightlife and beach life like Tel Aviv.
A 30-year-old couple is 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 have a budget of $ 2 million to $ 3 million.
Then there are the “exceptionally large briefs” that Beauchamp is offering in ultra-high-value Emiratis.
“There is no maximum budget and the specification is impossible to define, but it must be unique and of high specification,” says Bortnick. “This usually translates to penthouses, like HaYarkon 29, or large villages on Rothschild Avenue or on the coast.”
One property that Fridman is signaling to Emirati buyers is a $ 65 million Baroque penthouse in Tel Aviv that could embarrass Versailles: located near Royal Beach, the crown jewel at the top of the Sea One Tower has empire-style furniture, a formal dining room with seating for 16, and floor-to-ceiling windows overlooking the Mediterranean.
Penthouse on top of Tel Aviv’s Sea One tower.
Sotheby’s International Israel
Although it is the only part of the city that touches the water, Tel Aviv’s waterfront has long been the last undeveloped area of the city. Now it is the “Golden Kilometer”, with a series of condominiums and luxury hotels. Corridor real estate deals have reached $ 1 billion in the past decade, according to the New York Times.
While the doors are opening up to a new lucrative market, meeting their demands is no easy task: emiratis are used to luxurious villas and luxury skyscrapers in Dubai and Abu Dhabi, and are looking for trophy properties on the same level or even higher.
Beauchamp targets a $ 30 million mega-penthouse on HaYarkon Street as his first superprime home in Israel to be sold to a wealthy sheikh or tycoon.
Designed by the Israeli company Bar Orion, the duplex at the top of HaYarkon 29 spans the entire 16th and 17th floors of the building. There is more than 5,700 square feet of living space (accessed by private elevator, of course), while outside, a private terrace houses an infinity pool and jacuzzi, roof garden and 360-degree views of the city, coastline and the sea.
Jeremy Gee, managing director of Beauchamp Estates, sees the sale of the roof that opens Tel Aviv as a legitimate alternative to Morocco, London or Marbella for Gulf tourists.
“When a sheik buys, another one follows,” he says.
It’s not just about individual buyers: Emirati developers 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 around the world,” says Bortnick. “Several hotel owners and operators in Dubai approached us to look 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, the combination of architect Ilan Pivko of a 40-unit condominium and a five-star boutique hotel, will be less than 60 meters from the water when it opens in 2022. Layouts range from one to four rooms, with prices starting at $ 2 million.
A representation of the development of the Port of Tel Aviv.
One block away is the David Promenade Residences under construction, a 28-story tower managed by Kempinski Hotels. Duplex coverage there costs more than $ 46 million, according to the New York Times.
Although the initial wave of interest comes from countries that have already established diplomatic ties with Israel, Bortnick says that Beauchamp is also receiving preliminary consultations from other parts of the Arab world.
“[They] have observed the growth of the Tel Aviv housing market in recent years and want to buy as soon as the protocol allows. “
He is confident that the reciprocal housing boom will further fuel the Middle East peace process.
“This is always positive when it comes to politics,” says Bortnick. “The more people that meet, socialize and work together, the better things are.”
Originally appeared on Architectural Digest