Benny Landa's troubles cost Vitania an additional 50 million shekels in losses

The collapse of high-tech entrepreneur Benny Landa's businesses continues to take a heavy toll on the income-producing real estate company Vitania. The company, controlled by the family of automotive and shipping billionaire Rami Ungar, reported negotiations to acquire Landa's rights (50%) in the first phase of an income-producing property that Vitania is building in Ness Ziona. If the move is completed, it will lead Vitania to record an expense of 18 million shekels in its financial statements for purchase tax, as well as an accounting loss of 50 million shekels.

Vitania's report to investors this morning shows that Vitania will acquire Landa's company rights in the first phase of the project currently under construction by assuming Landa's bank debt in the amount of 247 million shekels, and in addition, Vitania will waive a debt of Landa in the amount of 50 million shekels.

As part of the agreements, a loan agreement was signed the day before yesterday (Tuesday), according to which Vitania will guarantee a loan that a bank will provide to Landa in the amount of 40 million shekels. This is a loan that will be spread over 4 years at an annual interest rate of prime plus 3% (an interest rate of 8% today).

Vitania and Landa hold equal parts in the "Vitania Landa" office project in the Science Park in Ness Ziona. The project includes a building that combines industrial areas, laboratories, and offices with an area of about 40,000 square meters and an underground parking lot with an area of 23,000 square meters.

The project was originally intended to house Benny Landa's printing company, which fell into debt of 1.7 billion shekels and filed for a stay of proceedings in the summer of 2025. As a result, Vitania was forced to make a loss provision of about 80 million shekels last year.

Last May, Vitania reported that it would lease the building to Elbit Systems. The lease agreement with Elbit for the property was signed for a long term of about 25 years, with Elbit having its first exit point at the end of 17 years and 9 months. The total rent for the lease period until the first exit point is about 544 million shekels. Acquiring full rights will give Vitania an income volume of about 34 million shekels per year. The acquisition and reaching 100% of the property will significantly increase the NOI and FFO and will generate strong cash flow from the property over the period. In addition, the deal will allow Vitania to control the continued initiation and development of additional rights.

By the opening of trading this morning (Thursday), Vitania's stock had fallen by about 38% since the beginning of the year, and the company's market value this morning stands at about 680 million shekels, lower than its equity, which is estimated at about 1.1 billion shekels.