Apartment buyers canceled 15 deals at Azorim: The drama in Tel Aviv
The company's report for the second quarter shows a decrease in revenue from apartment sales. However, the real estate giant shows a significant increase in net profit to 54 million shekels. What happened to the sales pace, what influenced the wave of cancellations, and how much did the company sell in the last half year? The CEO: "We grew compared to the first quarter."
How many apartments did Azorim sell in the second quarter of the year and do the data indicate a significant decrease in sales and a continued slowdown in the market? According to the second quarter reports, the company's net profit jumped by 160% to 54 million shekels. The gross profit margin rose to 29% compared to 23.6% in the corresponding quarter, and the gross profit margin from apartment sales rose to 27.3%. These data do not reflect a slowdown in the apartment sales market of Azorim. The expected gross profit in the next four years stands at about 1.6 billion shekels.
So what is happening to the sales pace? According to the report, in the first half of the year, the company sold 90 apartments for a total financial volume of about 318 million shekels. From the end of the quarter until today, 42 additional housing units were sold for a total financial volume of about 152 million shekels including VAT - about 3.62 million shekels per apartment.
During the reporting period, the company sold 90 housing units, compared to 134 units last year. The company notes that 15 sales transactions worth close to 57 million shekels were canceled. 7 of the contracts were canceled in the Frankfurt Boulevard project, where buyers were given the right to cancel the contract in case of not receiving a building permit by the date set in the agreement - an option that the buyers chose to exercise.
Income from apartment sales decreased from 810 million shekels to 654 million in the half-year. In quarterly terms, there was a decrease from 372 million shekels to 308 million shekels. However, the average price of a housing unit in the first half of 2026 amounted to about 4.25 million shekels, compared to about 3.47 million shekels in the corresponding period last year, an increase of about 22.5%, which reflects variance in the projects.
Net financing expenses amounted to about 52 million shekels this year, compared to about 28 million shekels in the corresponding quarter, following the expansion of credit volume for projects and the financing of new land purchases.
For the first half of the year, income amounted to about 793 million shekels. In the second quarter, income was about 376 million shekels compared to about 455 million shekels in the corresponding quarter - the company estimates the decrease is mainly due to the progress of projects.
Azorim currently has 23 projects under execution and marketing including over 4,900 housing units. Of these, 12 are urban renewal projects including 3,173 housing units for construction and 2,227 for marketing.
Equity attributable to shareholders amounted to about 2.55 billion shekels, compared to about 2.24 billion shekels at the end of June 2025, and the company has a positive working capital of about 1.07 billion shekels.
"As a leading company in the Israeli real estate market, even in periods when the housing market is challenging, we continue to work energetically to promote new projects across the country out of a long-term strategic vision," says Adi Dana, CEO of Azorim. He adds that macro trends, including market expectations for further moderation in interest rates and calm in the security situation, may support the residential construction industry.
"We are concluding the second quarter with a significant improvement in profitability indicators. Since the beginning of the year, we have completed the construction and started occupancy of significant projects including over 1,200 housing units built in the shadow of three wars, and we expect to complete three additional projects by the end of the year," Dana concluded.
