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The 36 biggest companies specializing in yield-generating real estate - primarily shopping centers and office buildings whose tenants pay rent to property owners - increased their investments by 26 percent in 2005, to a total of $14 billion, Dun & Bradstreet Israel said Sunday.
Last year "was a growth year for Israeli yield-generating real estate companies, especially for those that expanded their investments abroad. In the course of the year tens of deals to acquire yield-generating assets in Israel and abroad were carried out, in a trend that is continuing now as well," said Dun & Bradstreet General Manager Reuven Kuvent.
Competition also heated up last year between companies vying to acquire shopping centers and office buildings within Israel, as part of their efforts to have a fuller asset portfolio ready for public offering as a Real Estate Investment Trust (REIT), an investment tool made possible by new legislation.
Kuvent added that the real estate companies shined on the Israeli stock market in 2005, with the Tel Aviv Stock Exchange's Real Estate 15 index rising 30%. The index experienced particularly strong growth in the second half of the year and in the first quarter of 2006, hitting record levels 110% higher than at the beginning of 2005, Kuvent noted. He cited investment house Excellence Nessuah's Kessem real estate basket which grew 30% in 2005, peaking at 96% above its level at the beginning of the year.
Several Israeli real estate investment companies also successfully launched on London's AIM exchange last year, Dun & Bradstreet added.
The total revenue accrued by the 36 leading yield-generating real estate companies from their deals grew 36% to $2b., while their aggregate capital rose 22% to total $2.2b.
Gazit-Globe led the D&B Israel list with more than $4.4b. invested in yield-generating properties, $477m. in income from operations, and $415 million in independent capital, followed by Jerusalem Economic Company - a TLC subsidy - which boasted nearly $1.9b. invested, $203m. in revenue, and $102.3m. in independent capital. JEC's subsidiary, Industrial Buildings, came in third, with more than $1.2b. invested, $132m. in revenue, and $266.9m. in independent capital.
The TASE's Real Estate 15 Index includes Africa-Israel Investment, Africa-Israel Properties, Alony-Hetz, Azorim, Bayside Land Corp., Elbit Medical Imaging, Electra, Delek Real Estate, Gazit Inc., Gazit-Globe, and GTC Real Estate (Kardan).
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