So near, yet so far

Real-estate entrepreneur Motti Kirschenbaum has now spread his wings outside the confines of Israel and is "exporting" the success of Airport City.

By JOHN BENZAQUEN
Airport City 88 224 (photo credit: Courtesy)
Airport City 88 224
(photo credit: Courtesy)
Motti Kirschenbaum is a real-estate entrepreneur who pioneered an idea in Israel, which he called Airport City. The concept was relatively well-known in Europe, especially in the UK, but it was not very well-developed in this country. It meant developing a business park with a unique location and optimum size. Location meant somewhere outside the congested urban areas of a major city, being well-serviced by roads and rail lines, and not farther than 30 kilometers from the metropolitan center. In addition, it had to be large enough to create a "business community" that catered to its own needs - a business city in itself. It received the name Airport City because Kirschenbaum managed to locate a 760-dunam plot that was very near Ben-Gurion Airport. It is a catchy name. But it was not born in a flash of inspiration, but rather because the Israel Lands Administration had land available near the airport. "I conceived the idea of Airport City in 1992," Kirschenbaum told The Jerusalem Post. "The master plan, when finished, will contain 450,000 square meters of developed space. It will be a self-contained area with 'clean' industrial enterprises, mostly hi-tech, logistics, offices and service companies, which will include accountants, lawyers, restaurants, convention centers, business hotels and commercial enterprises of all sorts. The idea been that the businesses located in the business park and their employees can, if they so wish, find every thing they need inside the business park." Airport City was floated in the Tel Aviv Stock Exchange. Its major shareholder is JOE, which bought the controlling interest from Kirschenbaum in 2001. Space in Airport City is rented out. Kirschenbaum has now spread his wings outside the confines of Israel and is "exporting" the success of Airport City. Through a company called Europort Ltd. he is promoting business-park projects in eastern and central Europe. But if Airport City is such a success, why build elsewhere; why not build another such project in Israel? "Because there is no need, at least not for the time being, for another such project in Israel," Kirschenbaum says. "You must realize that because of its location it has easy access to both Tel Aviv and Jerusalem, and I see no need for such a project either in the North or South of the country. "But there is another reason. I am an entrepreneur. In my projects I invest my own money as well as the money of other investors. And as a businessman, I invest in projects that will show the biggest yields and I try to get the biggest returns on my investments. "We did a project similar to Airport City in Belgrade, the capital of Serbia. It is smaller than the one in Tel Aviv, but the concept is the same... "The project was recently sold to the Africa Israel Development Company, and the yield on our investment was in the region of 25 percent. And this, I can assure you, is more than twice the yield on our investment in Israel." Airport City Belgrade is the first of a series of such projects planned for eastern and central Europe by Europort. Its latest project is in the Ukraine, near Odessa, and it is actively looking for land for similar projects in Russia, Latvia, Romania and Hungary. "East and central Europe are a gold mine for real-estate entrepreneurs in business real estate," Kirschenbaum says. "These countries are experiencing rapid economic growth, but there is a chronic lack of quality accommodation in the style and in the standards to which multinationals are accustomed. "Furthermore, land in these countries is still relatively inexpensive, and these are the main reasons for the high yields on such investments. It is also the reason why this part of the world has become the Mecca of local real-estate developers."