The “Diamond Club,” as traders call it, has been around since 1937, before the state of Israel was even established. It is the world’s largest diamond exchange with over 3,100 traders, located in five high-rise office towers connected by bridges to create one complex.
One of the largest diamond exchanges in the world, diamantaires are engaged in diamond cutting and trading- marketing, brokerage, import and export. Since the product of this industry is so valuable, the Exchange is very serious about security. Set off an alarm and the entire building will shut down; the doors automatically lock and elevators will stop running. They don’t allow just anyone to walk in; you have to be a member of the Diamond Club or be escorted by one, after going through security and being given a temporary pass.
We were lucky enough to be given a tour by our friend Ami Haimoff, a diamond trader and Daon Group real estate broker. Ami grew up in Queens, New York and has been in the diamond business since he was 16, working for his father after school and selling diamonds to local jewelry stores.
The Diamond Exchange is a very surreal experience to the uninitiated. While walking around, we saw dozens of people casually carrying suitcases filled with hundreds of thousands or even millions of dollars worth of diamonds. Obviously, when walking with millions of dollars on you at a time, you don’t want to have to leave the Exchange often throughout the day. That’s why inside of the Exchange there is a post office, several restaurants, a barber, and even a cell phone store where members sign up for a special discounted phone plan.
So how does one become a member of the diamond club? It’s not simple: you must be recommended by several current members and be personally guaranteed by six different traders, who become liable for you for up to $100,000. This is to make sure only the best traders can join and protect the reputation of the industry.
These days, the Diamond Exchange is past its prime. In 2007, the diamond industry’s exports totaled around $7.1 billion, and in the following decade those numbers have steadily been dropping, to $4.4 billion in 2017. The industry started to change with the advent of the internet, as factories outsourced and the need for a middleman diminished. This caused the exorbitant prices for office space to drop.
Until about a year ago, only diamond traders and those directly involved in the trading process were allowed to rent office spaces in the Exchange. Now, since many traders have left the complex due to a crisis in the industry there is freed up space in the building, and the doors have opened to businesses and services which will benefit the day-to-day life of the diamond trader.
With all his connections and a new market for real estate in front of him, Ami switched hats to become a real estate broker, representing all his contacts in the diamond world.
In the future, the road is being paved to allow new start-ups to rent space out. New ventures hoping to issue cryptocurrencies backed by diamonds are on the horizon, which will fill up more of the unused office space, and hopefully provide a stable future for the industry.