Gav Yam Reports Third Quarter 2021 Results

TEL AVIV, Israel, Oct. 27, 2021 /PRNewswire/ -- Gav Yam Land Corporation Ltd. (TASE: GVYM) one of Israel's largest and longest established real estate companies, specializing in the initiation, planning, development, construction, leasing, maintenance and management of hi-tech, logistics, and industrial parks and centers throughout Israel, today reported its financial report for the third quarter and the first nine months of 2021.

The results reflect a full return to routine, continued stability and growth across all operational parameters, and a significant acceleration in intensive entrepreneurial activity, including 13 projects, with a total area of 660,000m² (of which 500,000m² are the Company's share in the Company's consolidated financial statement), with a total investment of about NIS 4.5 billion (the Company's share in the consolidated financial statement). About 25% of the above-ground areas in these projects have been already marketed.

Financial Highlights

• Net profit attributed to shareholders amounted to NIS 695 million in the first nine months of 2021, compared with NIS 172 million, last year. The increase is mainly due to growth in income from the increase in the fair value of investment in real estate compared to the corresponding period last year.
• The Company's cash flow from operating activities in the first nine months of the year amounted to NIS 364 million, an increase of 14% compared with the corresponding period last year.
• •  The Company's rental income in the first nine months of 2021 amounted to NIS 408 million, compared with NIS 401 million in the corresponding period last year.
• •  The Company's NOI in the first nine months of the year amounted to NIS 391 million, compared with NIS 388 million in the corresponding period last year.
• •  EBITDA in the first nine months of 2021 amounted to NIS 363 million, compared with NIS 361 million in the corresponding period last year.
• •  The FFO attributed to shareholders amounted to NIS 193 million in the first nine months of the year, an increase of 6.6% compared with the corresponding period last year.

Management Comment

Avraham Jacobovitz, CEO of Gav-Yam, commented: "High-tech companies, within the context of Israel as a leading technological power, established new development centers and hired employees at high intensity, which led to continued growth and lead market trends."

"Strong market demand continues and is driving the real estate industry forward and is leading to accelerated growth in the office space. New areas are being absorbed already during the construction stages. The office market in Tel Aviv and Herzliya are at the forefront and leading the trend, and it is expected to strengthen and grow in the coming years. High-tech companies have chosen to be an integral part of the Tel Aviv metropolitan and Herzliya area and lead the demand as part of a structured process, relying on high-quality human capital that is the main backbone of high-tech companies. Within the complex of Tel Aviv and Herzliya, the Toha1 and Toha2 towers and the Gav-Yam centers in Herzliya, constitute a central focus for the office market, in addition to other high-tech parks of Gav-Yam, and meet demand."

"Gav-Yam is seeing very strong demand, examining many deals and participating in all the tenders of international technology companies."

"Gav-Yam continues with great intensity on a very clear route of large-scale and intensive entrepreneurial activity, which includes 13 projects, with a total area of ~660,000 m² (~500,000m², in terms of the Company's share in the consolidated financial statement), with a total investment of ~NIS 4.5 billion (the company's share in the consolidated financial statement)."

"The highlight is the ToHa2 project, with a total area of 210,000 m² (~105,000 m² the Company's share), a mega-project that is the spearhead of the Company's operations. We anticipate widespread demand in this project, at high rental prices."

"With the completion of these projects and their occupancy by the end of 2026, the Company's revenues will gradually increase to ~NIS 950 million per year. 25% of the above-ground areas in these projects have already been marketed."

In the first nine months of 2021, the company signed 123 leases, with an average real increase in rents of about 7.4% (in existing properties). "

Company Summary

Gav-Yam has 1,034,000m² of properties, with a wide spread, both in geographic and sectoral terms across  19 cities around Israel, including 22 parks and high-tech centers, offices, logistics, industry and commerce. They are adjacent to main arteries, Class A premium buildings, with high LEED standards. In addition, the Company has reserves of available building rights, amounting to ~490,000 m².

The Company has about 430 customers, including large international companies, top-tier, as well as the largest technology corporations in the world. As of the end of 2020, the Company's backlog of signed lease agreements amounted to NIS 2.3 billion for income-producing properties, and NIS 2.75 billion including signed lease agreements for construction projects. The lease agreements last for an average of about 4.4 years.

The Company showed continued stability in all operational parameters and financial strength, which is reflected in cash balances of ~NIS 1.2 billion, leveraged at a rate of 51.2%, a debt-rating of AA by Maalot (S&P Israel affiliate), and 100% of the Company's assets are non-collateralized. The Company continued a trend of stability in occupancy levels of occupancy and rent increases.

The Company has strategic partnerships with the leading academic institutions in Israel. This is the next good news, which brings the highest quality technological manpower – both quantity and quality. Gav-Yam significantly deepens its activities and collaborations, which include, among others, the Hebrew University of Jerusalem, Ben-Gurion University of the Negev and the Weizmann Institute.

Gav-Yam has set itself the goal of expanding its activities in the field of logistics and industry centers, an expanding area, which is a stable anchor with great demand and is marked as one of the future engines for growth. Gav-Yam is currently initiating four projects in this field, with a total area of ~75,000 m², of which 65% have been marketed.

About Gav-Yam

Gav-Yam Land Corporation Ltd. is one of Israel's largest, longest established real estate companies.

The company specializes in the initiation, planning, development, construction, leasing, maintenance, and management of hi-tech, logistics, and industrial parks and centers nationwide, as well as in the construction of dedicated complexes planned for long-term leasing. Through a wholly owned subsidiary, Gav-Yam also provides a variety of maintenance management services to tenants throughout the leasing period.

Gav-Yam was founded in 1928, and has been listed on the Tel Aviv Stock Exchange since 1978. Today, the company's shares are included among the leading indices of real estate (Tel-Bond 60) and large companies (TA-125). In addition, the company's debentures are rated AA by S&P Maalot and Aa2 by Midroog.

Contact Information

SOURCE Gav-Yam

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