Alony Hetz posts NIS 4b revaluation losses in two years

Nathan Hetz  credit: Tamar Matsafi
Nathan Hetz credit: Tamar Matsafi

The real estate company controlled by Nathan Hetz has reported an asset write-down for the sixth successive quarter.

Income producing real estate company Alony Hetz Properties and Investments (TASE: ALHE) has reported a revaluation loss of NIS 1.3 billion in the fourth quarter of 2023. The company, controlled by Nathan Hetz, notified the Tel Aviv Stock Exchange this morning of a material write-down of the fair value of its assets in the US (NIS 775 million) and the UK (NIS 566 million). The company’s share price is down by about 5%.

This is the fourth successive quarter in which Alony Hetz has written down the value of its assets. In total, it has recorded revaluation losses on overseas assets of NIS 4 billion in the past two years, which is substantial for a company with a market cap of around NIS 5 billion.

In its most recent financial statements, Alony Hetz has cited the crisis in the office markets in the US and the UK as the main problem in its overseas business. "Vacancy rates have been recorded the like of which have not been seen since the crisis," the company stated in its report released two months ago.

In a conference call with investors following publication of the financials, Nathan Hetz claimed that the market was about to experience significant recovery. "Inflation has been eliminated. A year ago, the fear was of hyper-inflation of 9% in the US and 12% in Britain. For the coming year, all the forecasters are talking about inflation of 2-2.5% in the US, and so everyone is waiting for the Fed to start talking about cutting interest rates, which will lead to substantial rises in the real estate markets."

In that report, the company disclosed that in the first two weeks of the war it had raised its exposure to 45% of its shareholders’ equity, from 25% previously. Alony Hetz currently has a NIS 3.5 billion exposure to foreign currency, which means that if the shekel strengthens by, say, 10%, its shareholders’ equity will fall by NIS 350 million, while it will of course post gains of a similar amount if the currency moves in the opposite direction.

Published by Globes, Israel business news - - on January 24, 2024.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2024.

Nathan Hetz  credit: Tamar Matsafi
Nathan Hetz credit: Tamar Matsafi
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