Africa-Israel predicts losses of NIS 2.7 billion in 4th quarter of 2009

Africa-Israel Investments issued a severe profit warning Monday, expecting losses of NIS 2.7 billion in the fourth quarter of the fiscal year. The main reason for the losses expected is the Times Square building in New York city: the company recently conducted an assessment of its value and found it to be worth $315 million; whereas the building when fully rented out would be worth $500 million. As such, the company fears that because of the low assessment, contacts to sell half of the ownership rights in the building will not come to fruition. Africa-Israel committed itself to finance agreements at $711 million - twice the property's estimated value.