Midas Momentum: The asset improved, but is it enough to refinance?
Momentum no longer looks like a newly delivered asset waiting for tenants: 2025 NOI jumped to ILS 8.6 million and average occupancy rose to 68%. But the same year also ended with a missed bank NOI test, a waiver, and only a two-month extension on the way to long-term financing.
Momentum is no longer the old problem. It is also not a financing solution yet
The main article already argued that Midas's bottleneck sits at the parent level: the group has asset value, but the real question is how much of that value can turn into accessible cash in time. This follow-up isolates Momentum because it is the most advanced Israeli asset in the portfolio, and therefore the cleanest test of whether operating improvement has already become refinancing capacity.
At the asset level, 2025 was a strong year. Average occupancy rose to 68% from 64%, leased area increased to 8,421 square meters from 7,696, revenue jumped to ILS 10.7 million from ILS 5.2 million, and NOI rose to ILS 8.6 million from ILS 1.9 million. Adjusted NOI also improved, to ILS 9.4 million from ILS 7.3 million, while the tenant count increased to 21 from 19. This is no longer an asset in an early lease-up phase.
But the same asset also ended the year with ILS 176.1 million of bank debt classified as short term, with failed NOI tests under the loan, with a bank waiver dated December 31, 2025, and with only a two-month maturity extension by the report-signing date in order to arrange long-term financing. That is the core point of this continuation: the operating improvement is real, but as of year-end 2025 it still had not become a fully closed financing story.
The hard signal: NOI improved, but it still stayed below the bank's test
Momentum was refinanced in February 2024. Under the new loan, NOI had to be at least ILS 6.5 million in 2024, at least ILS 10.5 million in 2025, and LTV had to remain below 76%. The company states explicitly that delayed move-ins pushed back occupancy and caused the joint venture to miss the required NOI for both 2024 and 2025.
That matters more than the softer headline that "the asset improved." An asset can improve a lot and still fail the lender's test. That is exactly what happened here. NOI surged, but not fast enough to clear the ILS 10.5 million threshold, which is why year-end ended with a waiver rather than with a quietly completed refinancing story.
| Layer | 2025 figure | What it means |
|---|---|---|
| Actual NOI | ILS 8.626 million | A sharp improvement versus 2024, but still not enough |
| Bank NOI test for 2025 | ILS 10.5 million | The threshold that was missed |
| Gap versus bank test | ILS 1.874 million | The practical reason the waiver was needed |
| Representative NOI in the appraisal | ILS 14.405 million | The appraisal already sits one step ahead of current performance |
| Gap between actual and representative NOI | ILS 5.779 million | The distance between an improving asset and a truly stabilized one |
| Loan balance at year-end 2025 | ILS 176.058 million | A large debt stack that still needed a long-term solution |
| Fair value at year-end 2025 | ILS 234.260 million | Helpful collateral support, but not a wide cushion |
There is another less obvious, but very important, point here. Dividing the ILS 176.1 million loan balance by the ILS 234.3 million fair value gives an implied LTV of roughly 75.2%. In other words, even on the company's own year-end valuation, the margin to the 76% LTV ceiling is only about ILS 2 million. That is a narrow cushion. It would not take much valuation softening, further leasing delay, or a more conservative lender view for the financing picture to remain tight.
Why the appraisal still does not close the problem
It is easy to read the year-end appraisal and think the debate is basically over. Fair value rose to ILS 234.26 million from ILS 233.13 million, and the stake held through Midasity is worth about ILS 103.1 million. On the surface, that sounds like an asset that has already crossed the proof line.
But once you look at the assumptions, it becomes clear why the appraisal is not the same thing as a refinancing close. The valuation table itself shows that the net yield implied by the property's current NOI is only 4.17%, while the weighted capitalization rate used in the appraisal is 6.95%. The same table assumes 66% occupancy in year one and 100% from year two onward, together with representative NOI of ILS 14.405 million.
In plain terms, the appraisal does not say the asset already operates today like a stabilized property. It says what the property is worth if the lease-up is completed, if occupancy fills out, and if income converges toward a higher level. That is not a flaw in the appraisal. It simply means the appraisal describes the economics the asset is moving toward, not the economics that have already been fully proven to the bank.
The value mix matters too. Not all of the ILS 234.26 million comes from the office-and-retail building exactly as it is leased today. Of that amount, about ILS 201.1 million relates to the office and retail structure itself, ILS 10.15 million to the gas station, ILS 24.384 million to additional building rights, and ILS 1.134 million to the electricity pool, before a ILS 2.5 million deduction for the completion certificate and stage-B parking multipliers. That is very helpful for NAV. It is not the same as fully proven in-place NOI that has already cleared a lender's underwriting test.
That is precisely why the operating improvement and the higher valuation were not enough on their own to produce fully closed long-term financing by the report date. The appraisal shows value. The bank was still testing proven NOI.
What has to happen for Momentum to move from an improving asset to a self-funding one
The good news is that there is a path. As of December 31, 2025, expected revenue from signed leases for 2026 stood at ILS 11.54 million. That means the economic direction of the property is now very different from what it was in 2024. Momentum does not need to be reinvented. It needs its signed leasing progress and occupancy gains to translate into recurring NOI that can clear the lender's test.
That leads to three practical checkpoints:
- Actual NOI has to move above the ILS 10.5 million threshold without relying on another waiver.
- The loan has to become genuine long-term financing, not another short extension that simply pushes the issue forward.
- The LTV cushion has to hold even under a less generous valuation view, because the current margin to the covenant ceiling is narrow.
The broader implication for Midas is straightforward. If Momentum, the company's most advanced Israeli asset, still cannot move from impressive operating improvement to fully closed refinancing, then the group's wider asset-value thesis remains time-dependent, not just value-dependent.
Conclusion
Momentum no longer looks like a strategic mistake or a stuck asset. 2025 proved that occupancy, revenue, and NOI all moved in the right direction. But the same year also proved something else: better asset economics and better financing are not the same thing.
As long as actual NOI remains below both the bank's threshold and the appraisal's representative NOI, Momentum helps Midas's thesis without fully solving it. It narrows the credibility gap, but it does not close it. For Midas that is critical, because if even this asset still needed a waiver and a short extension on the way to long-term financing, then the parent-level accessibility of value remains an open issue.
Disclosure: Deep TASE analyses are general informational, research, and commentary content only. They do not constitute investment advice, investment marketing, a recommendation, or an offer to buy, sell, or hold any security, and are not tailored to any reader's personal circumstances.
The author, site owner, or related parties may hold, buy, sell, or otherwise trade securities or financial instruments related to the companies discussed, before or after publication, without prior notice and without any obligation to update the analysis. Publication of an analysis should not be read as a statement that any position does or does not exist.
The analysis may contain errors, omissions, or information that changes after publication. Readers should review official filings and primary sources before making decisions.