Azrieli Group will pay Globus Max and Globus Group NIS 20 million to vacate its cinemas in the Azrieli Mall in Tel Aviv and Malha Mall in Jerusalem. The vacated space will be leased to Swedish fashion brand H&M, owned by Hennes & Mauritz AB (OMX: HMB), its first stores in Israel.
Globus Max will receive NIS 8 million for its cinemas in the Azrieli Mall, and Globus Group will be paid NIS 12 million for its cinemas in the Malha Mall. The deal include Azrieli Group subsidiary Canit Hashalom Investments Ltd., which operates the malls, foregoing rent from Globus Max beginning in June 2009. H&M Israeli franchisee, Match Retail Ltd. will apparently pay the rent for the space.
The move comes after Africa-Israel Properties Ltd. (TASE: AFPR) removed cinemas from the Ramat Aviv Mall and Savionim Mall. Gazit Inc. (TASE: GZIT) also replaced the cinemas at its Rothschild Mall in Rishon LeZion with fashion stores.
The H&M store at the Azrieli Mall will cover 2,000 square meters, and open in the spring of 2010. The store in the Malha Mall will cover 1,700 square meters.
Globus Max and Globus Group will probably seek alternative locations in Tel Aviv and Jerusalem, rather than abandon the two cities.
Published by Globes [online], Israel business news - www.globes-online.com - on July 19, 2009
© Copyright of Globes Publisher Itonut (1983) Ltd. 2009