The urban renewal panel at the "Funding Time" conference by Nadlan Media, held this week at the Carlton Hotel in Tel Aviv, became one of the most direct and charged sessions of the event. Senior managers, finance professionals, and veteran entrepreneurs spoke candidly about a market that is losing momentum – not due to a lack of demand, but because of excessive bureaucracy, regulatory inflexibility, and the state’s attitude toward those who actually drive the construction sector.
Attorney Eyal Belcher Cohen, CEO of Yesodot Group, opened with a sharp statement that drew applause from the audience: "The state wants us to build without making a profit; it doesn’t work that way." According to him, there is no logic in requiring entrepreneurs to invest years in projects with limited profitability or enormous risk. "Entrepreneurial profit is not greed; it is the fuel that drives the system. Without it, nothing will move."
Assaf Simon, CEO of Best Group, expanded on the criticism and spoke about the state’s attitude toward entrepreneurs: "There is a feeling in the country that entrepreneurs are the enemy. Those who build have to apologize. This is a fundamental mistake. Without profitability, there is no urban renewal, no construction, no housing solution. We need to stop seeing entrepreneurship as a problem and understand that it is part of the solution."
"Small Entrepreneurs Are Disappearing from the Market"
Sagi Barazani, Deputy CEO of Shoval Group, pointed out another danger – increasing concentration: "Small entrepreneurs are disappearing from the market, and this is dangerous for all of us. Bureaucracy, taxes, and financial difficulties leave only the large companies in the arena. We are losing competition, creativity, and the opportunity for a young entrepreneur to launch a project." According to him, "Urban renewal is supposed to be a story of repair and growth, but it has gotten stuck in endless forms."
CPA Erik Goldian, founder and owner of the non-bank finance company "Bonus," agreed that an immediate change of approach is needed from decision-makers: "The government needs to pull itself together, especially the governor. He acts against all logic and continues to keep interest rates high when it is clear that this paralyzes the industry. Only a reduction in interest rates will bring some optimism and restart the market." However, Goldian also praised the Capital Market Authority for a new initiative that introduces competition into the financing market: "For the first time, non-bank entities, including us, have been licensed to issue sale law guarantees and third-party guarantees. This is an important step that can change the rules of the game. When there is real competition in guarantees, costs for the entrepreneur drop significantly, and it’s a win-win for everyone."
Bringing a breath of hope into the discussion was Ori Paz, CEO of Michlol Finance, who announced a new fund worth NIS 400 million in collaboration with Clal Insurance, aimed at supporting entrepreneurs in urban renewal and rental housing. "We are here to inject oxygen into the industry," he said. "The banking system alone will not meet the demand. Non-bank entities must be an integral part of the solution – this is not a substitute, it is a necessary complement."
Paz summed up the spirit of the panel in words that sounded almost like a national call: "The projects exist, the entrepreneurs are ready, we just need financial flexibility. If we can combine entrepreneurs, banks, and funds, we can rebuild Israel here."