Efi Tzeva Properties Reports Strong Operational Gains Amid Slowing Apartment Sales
Translated & summarized from Calcalist by baba
Efi Tzeva Properties reported a 19.3% increase in AFFO to NIS 142 million in Q3 2026, driven by European expansion and the Landmark project in Tel Aviv. However, apartment sales at the Landmark project are significantly lagging construction progress. The company's net profit rose to NIS 508 million, boosted by NIS 500 million in revaluation gains. Efi Tzeva Properties' stock has fallen 22% year-to-date.
The story in 5 lines · by baba
- Efi Tzeva Properties' AFFO rose 19.3% to NIS 142 million in Q3 2026.
- Apartment sales at the Landmark project are lagging construction pace with only 18 units sold.
- Net profit increased to NIS 508 million due to NIS 500 million in revaluation gains.
- The company acquired six shopping centers in Romania, expanding its portfolio there to 20 properties.
- Efi Tzeva Properties' stock has declined 22% since the start of the year.
Efi Tzeva Properties, managed by CEO Avi Barazani, reported improved operational performance in the third quarter of 2026, with net profit boosted by positive revaluations. The company's Net Operating Income (NOI) increased by 8% year-over-year to NIS 293 million, while its Adjusted Funds From Operations (AFFO), a key profitability metric for income-producing real estate, rose by 19.3% to NIS 142 million.
This operational improvement is partly attributed to the company's expansion in Europe, including the acquisition of six open-air shopping centers in Romania in early July. This acquisition increased Efi Tzeva's Romanian portfolio to 20 properties, making Romania its primary operational focus. However, the strengthening of the Israeli Shekel against currencies in its operating regions, including Romania, Czech Republic, Poland, Serbia, Bulgaria, and Israel, offset some of the gains from new assets and existing property improvements.
The Landmark project in Sarona, Tel Aviv, in which Efi Tzeva holds a 50% stake alongside Melisron, continues to be a significant revenue source. It generated NIS 30 million in NOI during the quarter, up from NIS 28 million in the preceding two quarters. The office portion of Phase B of this project is nearing completion this year, with 99% of its space already leased, expected to yield NIS 60 million annually for Efi Tzeva's share. The residential component, featuring 116 units for sale, is slated for completion in the third quarter of 2027.
Despite the progress in construction, sales in the residential segment of the Landmark project are lagging significantly behind construction pace, with only 18 units sold and 58% of construction completed, reflecting broader difficulties in the housing market. The company also benefited from NIS 500 million in revaluation gains this quarter, compared to NIS 409 million in the same period last year. These gains contributed to a rise in net profit attributable to shareholders to NIS 508 million, up from NIS 442 million year-over-year.
Efi Tzeva Properties, controlled by BIG (79%), has a market capitalization of NIS 7.6 billion. Its stock has declined 22% since the beginning of the year, mirroring the 21% drop in the TA REITs Abroad index.
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