Persakowsky Sells Stake in Rental Properties to Migdal for $190 Million

Persakowsky Investments and Construction announced a strategic agreement with Migdal Insurance and Finance, under which Persakowsky will sell 50% of its rights in three long-term rental housing properties for approximately NIS 700 million (about $190 million). Persakowsky anticipates a cash flow of NIS 156 million from the deal and has recognized a significant profit of NIS 111 million. Despite selling half the rights, Persakowsky will continue to provide full management services for all units within the joint projects.

The transaction encompasses three key projects in high-demand areas, totaling around 800 rental units. The first is in Ben Shemen, Lod, a completed project with 286 rental units and 1,800 square meters of commercial space, for which Migdal will pay NIS 301 million for its 50% share. The second is in Beer Yaakov, currently under advanced construction, which will include 298 rental units, with Migdal paying NIS 330 million for a 50% stake. The third project is in Ganei Azor, Ramat Gan, based on land designated for 195 to 215 housing units and 700 square meters of commercial space, with Migdal's 50% share valued at NIS 66 million.

Yossi Persakowsky, Chairman of Persakowsky Investments and Construction, stated that the deal signifies confidence in Israel's institutional rental market and is a crucial step in the company's strategy to expand its operations in this sector. He expressed pride in deepening the partnership, which will enable the company to continue leading the institutional rental market and advance further projects, while retaining full management expertise.

Erez Migdal, Head of Investments at Migdal Insurance and Finance, added that the deal aligns with Migdal's strategy to broaden its real estate investments in Israel. He believes the partnership in these rental properties offers Migdal's policyholders a stable, long-term return anchored by strong local housing demand, viewing the long-term rental sector as a quality investment avenue and expressing pleasure in collaborating with a leading developer like Persakowsky.