The TLV mall in Tel Aviv is owned
Real Estate Square
-1.06%
Base:29,260
opening:29,260
High:29,900
low:28,250
change:3,447,596
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of Moti ben Moshe. But in the meantime the mall is unable to deliver the goods: the value of the property is estimated quarter after quarter at the same number: NIS 1.7193 billion. At the same time, the average rent per square meter is decreasing. If at the end of 2021 the average rent per square meter was NIS 233, and rose a little in the first quarter to NIS 235, then in the second quarter it is already a decrease to NIS 220 per square meter, a decrease of 6.4% within a quarter. This is of course worth a lot of money that disappeared to the company. More than that: the rents per square meter that were renewed during the period are falling even more – in the first quarter of 2022 the rents were NIS 357 per square meter, after all, in the second quarter of the year the new contracts were signed according to Average rent of NIS 308 per square meter. And this is already a fall of 13.7%. We note that the occupancy in the mall is also not improving and the mall registers a relatively low occupancy of tenants – only 82%.
In short, the situation at the TLV mall is bad (and Moti Ben Moshe even replaced the management of the mall in an attempt to improve the situation). But surprisingly – Blue Square Real Estate continues to list the property in the books at an interest rate of 4.5%. But that doesn’t make sense. It doesn’t reflect the situation on the ground. And beyond that – especially when the interest rate rises. The property should be valued at an interest rate of at least 6% It is true of course that there is room for growth in the mall, but it is still a significant gap. This potential is beautiful on paper, but the reality on the ground must also be taken into account.
Real Estate Quarterly Reports: 6% increase in NOI, and 22% in FFO
In any case, Blue Square Real Estate published its reports for the second quarter of the year, in which it presents an NOI of NIS 84 million, an increase of 6% compared to NIS 79 million in the corresponding quarter last year. The FFO in the current quarter was NIS 58 million, an increase of of about 22% compared to NIS 48 million last year.
Moti Ben Moshe, Chairman of the Blue Square Real Estate Board of Directors and the controlling owner: “During the second quarter, the TLV mall completes its preparation for the opening of the nearby light rail stations (Karlibach and Sderot Yehudit) and the completion of the infrastructure works on the area’s roads. Since we acquired full ownership of the mall, there has been an orderly process of adapting the mix of businesses to the needs and tastes of the target audience, and this within a difficult period For the shopping malls sector in the last two years where we suffered quite a few closures, the mix of businesses is undergoing a fundamental change and we are starting to see the results.
“We have appointed new management for the TLV mall, the general manager of the mall, Uri Smit, accompanied by Moshe Rosenblum, the company’s malls and shopping centers consultant, with the aim of improving the customer experience of visitors to TLV.
“From the beginning of the year until the end of the second quarter, the company signed contracts for over 4,100 square meters at an average of NIS 370 per square meter, with a significant portion already occupying the areas in the mall and some of which are in the process of adjusting the new areas, In addition, during the period, option agreements of 19 lease agreements were exercised in a total area of about 4000 meters with an average price of 17.8% in NIS, in addition, the company is in negotiations for the lease of additional areas amounting to over 4000 additional meters, some with existing tenants and some In areas that are under construction or areas that are not inhabited. This is evident in the movement
Visitors to the mall and redemption per meter.
“For example, the international fashion brand RESERVED has chosen to launch one of the four capsule branches of the brand that have been inaugurated in the whole world in TLV. The international brand DIOR will expand its store space in TLV by 3 times by the end of the year and will greatly increase the range of products it will offer to the public, as well as the April brand This month he launched his new concept “April Gallery” in a store 3 times larger than the one he operated in the TLV mall until now.
“During the second quarter, TLV will open the first phase of “Extra Market” – a premium supermarket that offers the residents of the 3,000 housing units above the mall, the workers of the towers in the nearby streets and visitors to the mall, fresh products from the best boutique manufacturers and suppliers in Israel – at particularly attractive prices. DKNY and the shoe brand store International Sam Idelman, opened new concept stores in TLV. Last week, Story Group launched Story Garz in TLV – an outlet store where Story Group will market all of its premium brands at special prices (Story is the franchisee of Scotch & Soda, Alo Yoga, and more). This is how the Israeli fashion store “Ata” and the STOLEN brand store opened in the mall in recent days. In the coming weeks, the TLV should be renewed with a significant number of stores such as: BVV – children’s arcade, OLE DELI, chef Oren Asido’s deli, 416 – a vegan restaurant and cocktail bar. Negotiations are taking place with surprising names from the fields of catering, leisure, sports and even automobiles.”
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