Business hotels in industrial parks are the new trend

Tel Aviv's new business district will have a large number of buildings more than 40 stories high.

By JOHN BENZAQUEN
business hotels 88 224 (photo credit: Courtesy)
business hotels 88 224
(photo credit: Courtesy)
A new trend among real estate entrepreneurs is building business hotels on a shell basis and then renting them out to hotel operators, who then complete the buildings to their own specifications. Currently, such projects are in the planning stages in the Ramat Hahayal industrial zone, the Herzliya Pituach industrial zone, in Ra'anana, Petah Tikva and on the northern half of Rehov Menachem Begin in Tel Aviv. According to Yoram Blumenthal, the director of corporate services at Inter Israel Real Estate Consultants, "These new business hotels will have an important bearing on the real estate scene in this country; they will create a new source of activity for real estate investors and will have a bearing on real estate prices in such places as Rehov Hayarkon." "Israel is now a fully integrated member of the global business scene and the number of incoming business tourists is increasing rapidly," he told The Jerusalem Post. "These visiting businessmen and businesswomen come for short business trips and they need hotels adapted to their needs. "The luxury hotels opposite the seashore in Tel Aviv, Herzliya and Netanya are fine for classical bona fide tourists; they are less so for businessmen, and more so for those who come to have a good time, view the sites, enjoy the beach, etc. It is true that the Hilton in Tel Aviv is at most times of the year patronized primarily by business people, but they would much prefer a hotel that is adapted to their needs." The Tel Aviv Hilton, for example, definitely has a certain allure. But it also has its disadvantages. Business people who are staying at any of the hotels on Rehov Hayarkon often have to spend hours getting from their hotels to the hi-tech industrial parks in Herzliya Pituach or Petah Tikva - and a business person cannot spare those hours. What he or she needs is a hostelry near their place of work, with facilities that allow access to the Internet, e-mail, etc. Luxury is fine, but the more practical things are, in this case, more important. Most of the large hotels on the Tel Aviv beachfront have all the facilities needed by business people; they even have special business lounges. But they also have many features that for a hard-working business person are superfluous. Besides, their location is lousy. If, indeed, we will see a flurry of new business hotels located in industrial parks or in business centers, then demand for hotel space in the traditional hotel areas will fall. This will affect demand for space on Rehov Hayarkon, which is today one of the most expensive streets in Tel Aviv. Prices in this real estate gold mine may fall, or at least level out. Hotels are not only planned in the modern industrial areas in the metropolitan area of Tel Aviv, they are also been planned in important business centers. The Sheraton City Tower in the Ramat Gan diamond district is one example of a business hotel situated in a bustling business center. Blumenthal said the northern part of Rehov Menachem Begin (the strip, as it is becoming known), from the Azrieli Center to the train station in north Tel Aviv, is also becoming an important business center. Together with the Ramat Gan diamond district and the office buildings surrounding Tel Aviv Magistrate's Court on Rehov Weismann, the area has become one of the country's major economic powerhouses. "The northern part of Rehov Menachem Begin will have a large number of buildings more than 40 stories high," he said. "Much, if not all, of the space in the Azrieli Square Tower will be rented out to a hotel operator who will operate a business hotel, and a similar arrangement is planned for one or more of the planned office towers on the strip." "The advantage of the northern part of Rehov Menachem Begin as the location for business hotels is that it is within walking distance of the surrounding business areas in the Weismann-Shaul Hamelech business area and the diamond district," Blumenthal said. "Another big advantage is that it has easy access to the Ayalon Highway, and from there to the national highway system."