Direct Finance Expands Real Estate Lending by Acquiring Sigma City

Direct Finance announced its expansion into the real estate sector by acquiring 85% of Sigma City for approximately NIS 34 million. The subsidiary, Direct Finance Real Estate and Mortgages, will integrate Sigma City, a company established in 2015 by Sigma Investment House, which specializes in providing flexible financing solutions, including capital supplements, to urban renewal developers. Sigma City, which received an expanded credit granting license in early 2024 and control permits later, offers rapid and diverse financing options, particularly for small and medium-sized developers, contrasting with traditional banking criteria.

This strategic move follows earlier reports from May and August regarding Direct Finance's intention to broaden its complementary credit offerings to developers. The acquisition is expected to intensify competition in the supplementary capital market for developers and strengthen Direct Finance's position within Israel's real estate financing value chain. The total investment by Direct Finance will reach NIS 63 million, comprising the NIS 34 million for the shares and a NIS 29 million owner's loan to Sigma City. The remaining 15% of Sigma City will be held by its managers, Uri Dayan and Natan Tobiana.

Direct Finance, led by Eran Golan, recently reported strong second-quarter earnings, achieving its highest quarterly profit to date at approximately NIS 74.3 million, a 324% increase year-over-year. Net profit attributable to shareholders rose by 329% to around NIS 68.7 million, with the car loan sector showing a significant 400% growth in net profit to NIS 37.4 million.