Bank Leumi Invests $100 Million in US Real Estate Firm Harbor Group
Translated & summarized from Globes by baba
Bank Leumi's real estate arm, Leumi Partners, has invested $100 million in US firm Harbor Group International, valuing the company at $1.28 billion. This investment provides Leumi Partners with an initial 8% stake in the multifamily housing sector. Harbor Group manages a significant portfolio and plans to triple its assets to $60 billion. The deal occurs during a challenging but potentially improving market for US real estate.
The story in 5 lines · by baba
- Bank Leumi invested $100 million in US real estate firm Harbor Group International.
- The investment values Harbor Group at approximately $1.28 billion.
- Leumi Partners will initially hold an 8% stake in Harbor Group.
- Harbor Group manages about 65,000 housing units and plans to grow to $60 billion in assets.
- The deal aims to capitalize on a downturn in the US multifamily housing sector.
Bank Leumi is capitalizing on a downturn in the US multifamily housing sector by investing $100 million in the American real estate company Harbor Group International. The deal, executed through Leumi Partners, the bank's real estate arm, values Harbor Group at approximately $1.28 billion and grants Leumi Partners an initial 8% stake. The investment provides Leumi Partners exposure to both Harbor Group's current operations and its future growth, with an option to increase its holding to 10%.
Harbor Group, founded in 1985, specializes in acquiring, improving, and managing income-generating real estate in the US, primarily rental apartment complexes, but also offices and commercial properties. The company also engages in credit financing for commercial real estate acquisitions. Its current portfolio includes around 500 properties, approximately 65,000 housing units, and 465,000 square meters of commercial space. Harbor Group employs about 1,600 people and has offices in the US, Israel, and Hong Kong.
The investment comes amid a challenging period for the sector, characterized by high interest rates leading to negative revaluations, as seen with Electra Real Estate whose stock has fallen 65% this year. However, industry executives anticipate a potential positive shift in the multifamily housing market in the coming months. Harbor Group's growth plan aims to expand its managed assets to about $60 billion in the next few years, nearly tripling its current size.
