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The consortium of underwriters that took Africa Israel (TASE: AFIL) subsidiary AFI Development public in London declined to exercise their green-shoe option to buy 10 million new shares in the company.

The option, which priced the shares at $14, expired last night.

AFI Development handles Africa Israel's property operations in Russia.

Capital market sources believe that the reason the underwriters were clammy was that AFI Development shares have lost 16% since the initial public offering at the start of May.

The underwriting consortium included Morgan Stanley, Deutsche Bank, Goldman Sachs and Citi.

Possibly the reason could also lie in intensifying uncertainties regarding the Russian real estate market, which have s

A month ago, it should be said, AFI Development's offering went superbly. The company raised $1.4 billion at a company value of $5.9 billion, premoney, and $7.3 million post-money.

However, since that happy date, AFI Development has by and large tanked on the London Stock Exchange.

Another reason for the cold shoulder to the share may be that Russia's RTS index has lost 7% in thelm.

Meanwhile, at the end of last week, the Russian real estate company PIK floated on the Moscow stock exchange and the London Stock Exchange. PIK mainly builds homes for the middle class in Moscow, and raised $1.9 billion, representing a company value of $12.3 billion, post-money. However, the offering ended below the bottom boundary of the price range, which had been $25-31.