In recent months, there has been a noticeable surge in the advancement of urban renewal projects in cities across northern Israel. One of the pioneering companies in this direction is Av-Gad, which has won seven tenant bids in the last quarter for projects in the Krayot and Nof Hagalil, with an estimated scope of approximately 4,000 housing units. Furthermore, the company is currently exploring additional projects in Karmiel and other nearby cities.
Attorney Re'em Ratzon, CEO of Av-Gad, explains the trend: "The company sees northern Israel as a significant growth engine for the coming years. We are expanding our activities in the Krayot, with new projects in Kiryat Ata, Kiryat Yam, Kiryat Motzkin, and Kiryat Bialik, based on the understanding that extensive government investments will be directed toward northern development in the coming years. These investments will, in our estimation, lead to increasing demand for high-quality housing among young couples and those upgrading their living conditions."
Av-Gad Holdings is a real estate development and construction company specializing in urban renewal. It was founded in 2009 by retired Colonel Michael Ratzon and Attorney Raam Ratzon. The company focuses on high-demand areas and brings extensive expertise in executing projects. Since its establishment, Av-Gad has delivered approximately 657 housing units across 20 projects, and by the end of the third quarter of 2024, it had accumulated around 11,000 housing units in various stages of planning and execution, 8,154 of which are in advanced stages.
Ratzon continues: "With the end of the war in the north, rehabilitating urban and community life in cities north of Haifa becomes a significant part of our corporate commitment—to act and contribute to the development of northern Israel in the coming years. We believe that our extensive experience in urban renewal, combined with the economic potential of the Haifa and Krayot areas, will generate value both for local residents seeking modern housing solutions in the Haifa metropolitan area and for investors."
Ratzon specifically refers to three new urban renewal projects that the company is leading in Kiryat Ata, for which Av-Gad announced its win last month. These projects join another project in Kiryat Yam, where the company recently received confirmation from tenant representatives of its bid victory. The four projects comprise a total of approximately 2,400 new housing units. Additionally, in the past month, Av-Gad has won tenant bids for further projects in Acre, Kiryat Motzkin, and Kiryat Bialik, each encompassing about 450 housing units, as well as another project in Nof Hagalil.
Data from the Urban Renewal Authority at the Ministry of Housing for 2024 indicate that the authority is promoting projects in northern Israel and prefers to invest in them through agreements with local municipalities. These agreements provide developers with financial compensation of approximately NIS 150,000 for each new housing unit, enhancing the financial feasibility of the projects. Over the past year, the authority has participated in projects in Afula, Migdal HaEmek, Tiberias, and Shlomi. According to Ratzon, "In our meetings with municipal leaders in the north, we see an awakening and a growing understanding that urban renewal benefits residents. The demolition of 1950s neighborhoods and the construction of modern-planned neighborhoods contribute to improving quality of life and attracting new populations. Municipal leaders, alongside planning departments and architects, recognize the need to formulate a local urban renewal policy and are working towards collaborative discussions with residents and developers."
A Magical Touch on the Shores of the Kinneret
One of the unique projects that the company is currently leading in the north—and in Israel as a whole—is the "Kinneret City" project. The district planning committee has approved the addition of 500 new housing units, all overlooking the waters of the Kinneret. The project includes a land-sharing agreement with a group of investors, among them former Tiberias Mayor Zohar Oved.
The project spans approximately 240 dunams and will feature five hotels, a unique spa benefiting from natural spring water, three residential buildings, a convention center, public spaces, a commercial boulevard with shops and stalls, and more. Additionally, as part of the project, an open-air theater is planned, accommodating around 3,500 seats and hosting approximately 150 music performances annually. The company anticipates that the theater will become a central attraction for drawing visitors to northern Israel. Surrounding the theater, about 60 hotel rooms will be built with direct views of the main stage—an innovative concept never before seen in Israel. Av-Gad also states that it is currently in discussions with Yoni Feingold, one of the founders of Zappa, to lead the music-related activities.
Michael Ratzon, Chairman of Av-Gad, summarizes: "Kinneret City is a nationally significant project driven by private entrepreneurship, which will transform Tiberias and significantly advance the hospitality sector in the Kinneret Basin and northern Israel. This project starts with a grand vision and presents a unique opportunity for economic and tourism growth that will strengthen the entire northern region."
Additionally, Michael Ratzon emphasizes that the project has broad support from tourism officials, planning bodies, and local authorities, including the Jordan Valley Regional Council and Tiberias Municipality. This is alongside the Ministry of Tourism and Minister Haim Katz’s recognition of the growing need for additional hotel rooms in the Kinneret Basin, highlighting the vast potential of the Kinneret City project to promote both domestic and international tourism.