The ceremony by Gaza's public works minister was a symbolic move to boost the spirits of the nearly 500 residents of Zafer 4 Tower, which was hit by two bombs from the air during fighting in August.
The high-rise was evacuated after Israeli warnings and before it was destroyed. One of the residents, 32-year-old Ahmed Tanira, said he left the building with his wife, two children, mother and aunt at the time, thinking that the Israelis may hit a specific apartment -- not topple the entire, 11-story building.
"It was a very big shock," he recalled. He said the cornerstone ceremony was "a glimpse of hope."
Tanira said he had just bought and moved into the apartment, 40 days before the war erupted in July. After the tower was flattened, he and his family moved from one rental home to another.
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At the time, Israel said it was targeting sites linked to Hamas militants, including rocket launchers, command centres and weapons depots.
It also accused Hamas, the Islamic militant group that controls Gaza, of using civilians as human shields in the fighting.
The project was paid for by Qatar Charity, which raised USD 3.5 million for it. At the event, Palestinian ministers signed two agreements with the charity to rebuild the tower and repair 100 other damaged homes.