The Menrav Deal at Anshei Ha'ir: Profit for Rothstein, Cash Still Needs to Reach the Parent
The Menrav transaction should create NIS 8-10 million of pre-tax profit for Rothstein in the second quarter, but the important mechanism sits one layer below: the proceeds start inside an Anshei Ha'ir granddaughter company, while part of the replacement exposure at Ibn Gabirol remains conditional until December 31, 2026.
The prior article left Anshei Ha'ir as a test of accessible value, not of gross backlog. The Menrav deal gives a partial answer: it should add NIS 8-10 million of pre-tax profit to Rothstein in the second quarter, and it brings a partner into the La Guardia project that will pay NIS 32 million plus reimbursement of about NIS 3.5 million. But that is not the same as free cash at the parent company. The money is paid to a wholly owned granddaughter company of Anshei Ha'ir, an associate in which Rothstein holds 41.32%, so it still has to pass through execution, financing, distribution decisions or loan repayment before it becomes accessible value for the public parent's shareholders. The second part of the deal, 49% rights in two Ibn Gabirol projects, is an interesting replacement exposure but not a mature asset: one project already has signatures above the legal threshold and a permit application, while the other is still very preliminary. The current read is therefore positive but limited: the deal improves liquidity and near-term profit potential at Anshei Ha'ir, but it still does not answer how much of the urban-renewal value can move up to the parent, when, and with what certainty.
The Profit Moves Up, the Cash Starts Below
The simple part is the accounting profit. Following the agreements with Menrav, Rothstein expects to record NIS 8-10 million of pre-tax profit in the second quarter, including excess-cost amortization under the equity method. For a company that measured Anshei Ha'ir through a loss in the first quarter, that matters: Anshei Ha'ir generated NIS 45.6 million of revenue and NIS 6.2 million of gross profit in the quarter, but ended with a NIS 4.6 million net loss. After Rothstein's share and excess-cost amortization, the associate contributed a NIS 3.6 million loss.
The more important part is cash access. The sale of 49% of the rights and obligations in La Guardia is not a direct sale of a Rothstein asset. It is a transaction by a wholly owned granddaughter company of Anshei Ha'ir. That means the stated proceeds first strengthen the Anshei Ha'ir and project layer, and only later, if there are distributions, loan repayments or another monetization event, can they reach the parent.
| Deal component | What was signed | What it means for parent-company shareholders |
|---|---|---|
| 49% sale in La Guardia | Menrav will pay NIS 32 million, NIS 16 million near signing and the balance by January 1, 2027 | The parent's indirect economic share in the consideration is about NIS 13.2 million before taxes, costs and distribution decisions |
| Project investment reimbursement | Menrav will reimburse about NIS 3.5 million, half on December 31, 2026 and the rest near receipt of a building permit | This cash also starts at the granddaughter-company layer, with part of the receipt tied to a planning milestone |
| Second-quarter profit | Expected pre-tax profit of NIS 8-10 million | This improves the equity-method line, but it does not prove that cash is already available at the parent |
| Ibn Gabirol rights | Menrav will transfer 49% of its rights in two projects for no consideration from Anshei Ha'ir | This is replacement exposure for the partly sold project, but part of it is conditional and still very early |
These numbers explain why the deal is better than another backlog update, but also why it should not be read as closing the cash-access gap. Anshei Ha'ir carries a meaningful layer of excess cost and goodwill above its reported equity. At the end of March 2026, its equity was NIS 51.9 million, while Rothstein's total investment in the associate was NIS 117.1 million, including a NIS 21.0 million loan, NIS 57.9 million of excess cost and NIS 16.8 million of goodwill. Every profit at Anshei Ha'ir therefore has to be read through two questions: how much of that gap it reduces, and how much of it turns into a real cash source at the parent level.
Ibn Gabirol Adds Exposure, but Not the Same Certainty
The Ibn Gabirol leg is why the deal is not just a monetization. Anshei Ha'ir is selling almost half of La Guardia, but it receives 49% of Menrav's rights and obligations in two Tel Aviv projects. That can be a sensible exposure swap: less concentration in one project, more projects inside the same strong urban-renewal geography, and a partner that brings both projects and execution experience.
Still, the two projects are not equally mature. Ibn Gabirol 117-119 is more advanced: 81% of rights holders have signed, above the 66% legal threshold, a permit application has been filed, and the applicable urban plan has been approved. The current plan includes 55 new apartments, 27 of them for market sale, plus 1,878 square meters of commercial and employment space. The initial estimate is about NIS 112 million of revenue and about NIS 96 million of costs on a 100% basis, with construction expected to begin in 2027 and completion about 38 months after construction starts.
Ibn Gabirol 113-115 is in a very different place. There is still no TAMA agreement, the required signature threshold has not been reached, and no building-permit application has been filed. The validity of the Ibn Gabirol agreements also depends on approval by the relevant tenants' representative body, and in the 113-115 project also on a special majority of owners signing the TAMA agreement. The timetable has a clear backstop: even after possible extensions, the final deadline for the conditions is December 31, 2026.
That is the real edge in the transaction. It is not only a partial sale of a project for cash. It also replaces some La Guardia risk with new rights that may extend the pipeline. But those new rights are not cash. One project already has a planning base and meaningful signatures, while the other is still an early possibility. Ibn Gabirol can deepen the Anshei Ha'ir platform, but it cannot by itself replace proof of surplus cash, distributions or loan repayment to the parent.
Anshei Ha'ir Still Has to Turn Projects Into Surplus
The Menrav deal arrives after a quarter that shows why cash access remains the important question. Anshei Ha'ir is not an empty shell or a remote idea: it already reports revenue, gross profit and a broad project pipeline. But in the first quarter it still did not generate net profit, and for Rothstein it still contributed a loss after excess-cost amortization.
That is how the Menrav deal should be interpreted. It improves Anshei Ha'ir's position in a specific project, brings in a partner for financing and execution, and creates second-quarter profit. It does not yet prove that Anshei Ha'ir can distribute cash or repay a shareholder loan at a pace that changes Rothstein's flexibility. In development real estate, profit inside a project can remain inside the project layer to finance execution, guarantees, tenant relocation, financing costs and replacement projects.
The strongest counterpoint is that leaving the cash inside Anshei Ha'ir is not necessarily bad. If the deal proceeds help advance La Guardia, reduce funding needs or mature Ibn Gabirol, the money may create more value inside the platform than through a fast distribution to the parent. But that is an execution argument, not a parent-cash-access argument. For it to get stronger, the next reports need to show that the deal did more than record a profit: it advanced projects, shortened the path to surplus, or improved Anshei Ha'ir's ability to move value up.
The Next Proof Is Cash Reaching the Parent
The Menrav deal is a positive development, but it closes only half the question. It proves there is an asset that can be partly monetized, a partner willing to pay, and an accounting profit expected already in the second quarter. It still does not prove that value at Anshei Ha'ir is accessible to Rothstein shareholders at the same speed at which it appears in the accounts. The next proof points are receipt of the remaining consideration and investment reimbursement, satisfaction of the Ibn Gabirol conditions by the end of 2026, and the most important signal: whether Anshei Ha'ir starts producing surplus, distributions or loan repayment that actually reaches the parent.
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.