Africa Israel Investments notified Tel Aviv Stock Exchange on Monday that it would expects to post a loss in the fourth quarter 2015 financials, due to a valuation loss on investment properties at its AFI Development unit in Russia.
The Israeli real estate developer, controlled by Lev Leviev, would post a loss of $409-485 million for the fourth quarter of 2015 and of $461-$487 million for 2015 as a whole. The company’s shareholders’ equity will total $306-332 million.
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According to the company’s notice, AFI Development will record write-downs and revaluation losses from the fall in the fair value of its investment real estate assets and its stock of work in progress mounting to $522 million before tax. A fall in fair value of the Afimall City mall in Moscow from $990 million to $686 million is included in this amount.
AFI Development, a Russia-focused real estate and investment firm, estimates that it will post a loss of $470 million for the fourth quarter of 2015.
The company noted that the estimates are preliminary and that preparation of the firm’s annual results was underway. “The valuation loss and impairment reflect a decrease in the value of the company’s projects due to continuously challenging macroeconomic environment in Russia and respective depressed condition of the real estate market, ” AFI said, citing a further deterioration in the rouble/dollar exchange rate and oil prices during the fourth quarter.
