The Edison movie theater, once a symbol of Zionist secularism in the Holy Land, will be transformed in a 60-unit building project for Satmar Hassidim.
News of the deal was first published in the haredi weekly Bekehila.
The edifice, which has stood empty for about 20 years, was the scene of bloody fisticuffs between haredim from nearby Mea She'arim and secular Israelis in the late 1940's and early 1950's.
Frequently the confrontations were sparked in the summer during daylight savings when Saturday night movies would begin before Shabbat was over.
The burned-out building, located on Rehov Yeshayahu Street in downtown Jerusalem, was bought two years ago by an American Satmar Hassid for $5 million. In the coming months it will be razed, with building commencing in the summer.
A spokesman for the Edah Haredit, an organization representing haredim who stubbornly resists any political, social or economic connections with the Zionist state, said the apartments would be sold exclusively to Satmar Hassidim at special discounts.
Kiryat Yoel Developments, named after Rabbi Yoel Teitelbaum, the previous Satmar Rebbe, will be building the project.