Abou Family Residence, controlled by real estate developer Tzahi Abou, has bought 40 apartments for rent in Tel Aviv’s Da Vinci Towers for NIS 61.5 million. Half of the apartments, which are in the north tower, cannot be immediately occupied because of the damage sustained from an Iranian missile in June.
The Da Vinci Towers are on Da Vinci Street in central Tel Aviv near Kaplan Street. Canada Israel won the tender in 2015 to build the towers on the 10.5 dunam (10,500 square meters) site with a bid of NIS 830 million. The project was completed for occupation in March 2023.
Following pressure from the Tel Aviv Municipality, 40 apartments in the project – 20 on the lower floors of the South Tower and 20 on the lower floors of the North Tower – were allocated for rent at prices defined as “affordable,” which are 20% lower than market prices. The average area of these apartments is 90 square meters, and they were built with relatively low finishing levels compared with the other apartments built in the towers and designed for the free market.
However, the price limit was ultimately lifted, as the Municipality and the Housing and Urban Development Authority realized that even after receiving a 20% discount from the market price, renting in the Da Vinci Towers would be very expensive. Therefore, it was decided to market the apartments in a tender to a developer who would purchase all the apartments together and rent them out at market price.
Another problem then arose: unlike apartments that are rented long-term, after which the developers can sell them, in the case of the Da Vinci Towers the apartments are supposed to be rented permanently. In a situation of low interest rates and yields in the area reaching around 2%, developers did not see these apartments as an attraction and the tender held last year failed.
Israel Land Authority offset about 60% of the price
Then during the war with Iran in June the towers sustained a hit from a missile, especially the northern one, which was particularly badly damaged (mainly in its lower part, where 20 of the apartments are located). The terms of ILA’s latest tender state, “The housing units being marketed were damaged during the Iran campaign. The bidder is aware of this and will not make any demand or claim to the Authority in respect of the aforementioned; the bidder is aware and agrees that their offer to purchase the housing units is in their ‘as is’ condition, and that all repairs as required by any law, as well as for the purposes of adapting the apartments to their needs, including fundamental repairs required in the apartments, are their full responsibility and at their sole expense, and they will not make any demand whatsoever to the Authority and/or anyone on its behalf.”
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The tender terms also state that the 20 apartments in the northern tower will be sold in their current condition. Finally, in order to adapt the current tender terms to the project’s dire situation, ILA reduced its original minimum price for the damaged apartments by about 60%, from NIS 101 million in the previous failed tender, to only NIS 43.2 million, about NIS 12,200 per square meter, while the average price per square meter in the area can reach NIS 50,000 per square meter.
So in a situation where a significant part of the tender is a bet on the condition of the damaged apartments and the cost of restoration, which could reach more than NIS 10 million, the price took its toll and five companies competed in the tender, submitting bids ranging from NIS 45 million.
Abou Family won the tender by offering NIS 61.5 million, or NIS 17,000 per square meter, which is about a third of the market prices in the area. The company will have to add 20-30% to this price to renovate the apartments, with a long delay until these apartments can be rented. The developers, led by Abou, believed that only under these terms is an investment in this project worthwhile, also shows the state of the real estate market in Tel Aviv.
The owner of Abou Family said the company estimates that the renovation of the 20 housing units will cost NIS 10-15 million, and that the average monthly rent per unit will be NIS 11-13,000.
Abou Family controlling owner and chairman of Abu Family Residence Tzahi Abou said, “We are delighted to have won the tender and intend to continue to identify additional deals that will yield significant returns, profitability for investors and good news for the rental market. We believe that the market is in a favorable period for finding additional opportunities like the one that has now come our way.”
Published by Globes, Israel business news – en.globes.co.il – on December 30, 2025.
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