JERUSALEM, Aug 20 (Reuters) - Israeli real estate developer Azrieli Group reported lower quarterly profit on Wednesday, citing lower gains on its investment properties.
The company, which built Israel’s first shopping malls and Tel Aviv’s landmark Azrieli Centre office and shopping complex, posted second-quarter net profit of 258 million shekels ($73 million), down nearly 6 percent year on year, with its net gain on investment property dropping to 8 million shekels from 93 million shekels.
During the quarter, which was unaffected by the Israel-Gaza military conflict that began last month, Azrieli invested 201 million shekels in investment property to bring its investment for the first half to 440 million shekels.
These investments will begin to contribute to net operating income next year, Chief Executive Yuval Bronstein said.
At the same time, Azrieli is working on reducing its costs by taking advantage of favourable interest rates to refinance existing loans and raise financing to maintain development momentum, Bronstein added.
Net operating income, which reflects the group’s core business, edged 1.5 percent higher to 281 million shekels, aided by growth in the Israeli market for office space.
The company was been controlled by Canadian businessman David Azrieli until his death last month. On Tuesday the company said that the controlling stake had been transferred to his three daughters. (1 US dollar = 3.5261 Israeli shekel) (Reporting by Steven Scheer; Editing by David Goodman)