Haim Katzman (Flash 90 photo, Gazit Globe stock exchange)
Businessman Haim Katzman takes G City (formerly Gazit Globe) to aggressively sell assets. The previous plan included the realization of real estate with a financial scope of 1.7 billion shekels and it will be expanded to 5.3 billion shekels.
As mentioned, the strategic plan for the sale of assets, almost all of which are not core assets, to the extent of approximately NIS 5.3 billion (including assets for which, as mentioned, binding agreements were signed in the amount of approximately NIS 1 billion, the completion of the sale of the first asset is expected in December 2022 and the completion of the sale of the second asset is expected during 2023) . Out of assets amounting to approximately NIS 4.3 billion, active negotiations are underway for the sale of assets amounting to approximately NIS 2.6 billion, and the company estimates that it will enter into new binding agreements amounting to approximately NIS 1.5-2 billion during the first half of 2023.
The properties added compared to the original sales plan:
1. A large pan-European real estate company approached the company and signed a confidentiality agreement to conduct a due diligence regarding a core asset of the company that was not included in the original sales plan, whose value in the company’s books is approximately NIS 840 million and for which there is a mortgage of approximately NIS 400 million.
2. The company will put up for sale in January 2023 two additional assets that are not core assets and that were not included in the original sales plan in the amount of approximately NIS 570 million. The assets do not carry a specific debt or encumbrance.
The company put up for sale 3 properties that are not core properties and that were not included in the original sales plan for a total consideration of approximately NIS 300 million. Regarding one of the three properties with a value of approximately NIS 160 million, active negotiations are underway.
As of this date, the company is updating on progress in obtaining new financing agreements in pledging properties in Europe:
1. The company received a non-binding memorandum of understanding for the financing of one property in Warsaw from a Polish bank and a German bank in the amount of approximately 125 million euros.
2. The company received a non-binding memorandum of understanding to finance one property in the Czech Republic in the amount of approximately 70 million euros. This property is one of the two properties for which proper inspections are being carried out for sale.
3. The company received a memorandum of understanding for the financing of one property in the Czech Republic which is held by the company at a rate of 75% in the amount of approximately 120 million euros, where subject to the closing of said financing, approximately 60 million euros will be used by the company to purchase the minority share in the property, so that the flow Net will amount to about 60 million euros.
Haim Katzman, founder and CEO of G City: “We are continuing and increasing the pace of executing the strategic plan to sell assets that are not core assets and to lower leverage in the group. This year we sold properties amounting to approximately NIS 1.5 billion at a price similar to the prices of the properties in our books. The quality of our properties, the mix of tenants and the location of the properties that are not in the main cities where we concentrate, is such that it is almost always possible to realize these properties at a price similar to their book price. We are determined to continue to complete our plan, significantly lower the leverage in the group and focus on improving our core assets mainly in the US and Israel as well as major cities in Europe.”
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