Salveo buys Karmiel properties for REIT

As Hizbullah rockets continue to rain down on the North, real estate investments in the area continue. Salveo Israel said it bought two residential complexes in Karmiel for NIS 120 million as part of its plan to set up a real estate investment trust, or REIT. Headed by international businessman Fr d ric Amar, Salveo Israel said Sunday it was in advanced talks towards the purchase of additional yield-generating properties worth about NIS 220m. to include in the REIT portfolio, which it said would concentrate on low-risk high-yield properties. The Karmiel properties, rented out to the state in long-term agreements, include 361 housing units and generate an annual yield of more than 9 percent. Salveo intends to raise about NIS 250m. over the coming months through Clal Finance for the purchase of additional properties for the REIT, and said it was working to locate other potential assets that could be rented out to institutions or large-scale parties. Meanwhile, also in Northern Israel, Property and Building subsidiary Gav-Yam said it was investing NIS 50m. in the construction of a third tower in its Matam business park in Haifa, and that a fourth one would be on the way. The first two towers - which include 22,500 square meters of office space - are already built and currently house workers of Intel, Zim and the Ofer Brothers, as well as law offices and other free trades. Rental prices in the towers range from $12.50 to $14 per square meter. Tenants are expected to be able to set up their offices in the third tower in July 2007. Matam is 50.1%-owned by Gav-Yam and 49.9%-owned by the City of Haifa The entire Matam Park complex counts 210,000 square meters of office space on 220 dunams of land and houses 8,000 employees of companies such as Elbit Systems, Microsoft and Philips.