TheMarker | Real Estate

February 23, 2020

Israel Canada and Electra sold land in Russia for $ 40 million

Payment for the transaction will be spread over five years ■ About 40,000 housing units, public buildings and parks are planned, some are already occupied ■ If the price to customers shall exceed 85,000 rubles per square meter the companies will make an extra payment

Shelly Appelberg

Israel Canada and Electra sold to the Russian real estate company Setl City plots of land in St. Petersburg, Russia, for $ 40 million. The surface of the plots is 2,400 dunam, which were acquired in 2007 for $ 100 million.  The area sold constitutes 10% of the total area.  A residential neighborhood of 40,000 housing units is planned, as well as schools and kindergartens, commercial areas and parks.

The Russian company has previously bought other plots in the project for $ 40 million (they also make up 10% of the total area) and has so far paid about $ 14 million of them. Setl City is expected to build 4,500 housing units beyond the 4,500 units already in advanced construction or occupancy stages.

Close associates to the deal said that about 100 housing units are sold each month and 1,500 units have been sold so far in the project. The transaction payments will be spread over 5 years, and the parties have agreed that if the areas of the project shall sell for more than 85,000 rubles per square meter, Setl City will pay to Israel Canada and Electra an additional consideration, based on the actual selling prices.

Israel Canada, controlled by Barak Rosen and Asaf Tuchmayer, and Electra, controlled by Itamar Deutscher, collaborate on another project in the Midtown Tel Aviv Project and the W Frame Project, located in Tel Aviv's Tzameret Park. The Electra Group is traded in Tel Aviv at a value of NIS 6.5 billion, and Israel Canada, which recently announced the purchase of Minrav Holdings for NIS 600 million, is worth about NIS 2 billion.