Investing in Israeli Real Estate

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Investing in Israeli Real Estate

  1. 1. Cary Sheih Georgetown University MPS in Real Estate, May 2010 MPRE 775: Inward and Outward Foreign Real Estate Investment
  2. 2. <ul><li>Part I – Background </li></ul><ul><ul><li>1. Country at a Glance </li></ul></ul><ul><ul><li>2. History and Transnational Issues </li></ul></ul><ul><ul><li>3. Economy </li></ul></ul><ul><ul><li>4. Global Financial Crisis </li></ul></ul><ul><li>Part II – Investing in Israel </li></ul><ul><ul><li>5. Investment Policies </li></ul></ul><ul><ul><li>6. Taxes Generally </li></ul></ul><ul><li>Part III – Investment Portfolio </li></ul><ul><ul><li>7. Inbound Investment to Israel </li></ul></ul><ul><ul><li>8. Outbound Investment to U.S.A . </li></ul></ul>
  3. 4. <ul><li>Geography </li></ul><ul><ul><li>Mediterranean nation in SW Asia – 273 km of coast </li></ul></ul><ul><ul><li>Size of New Jersey </li></ul></ul><ul><ul><li>Tiny Jewish country (red) surrounded by Arab nations (green) </li></ul></ul><ul><li>Demographics </li></ul><ul><ul><li>Population: 7.6 million (76% Jews, remainder Arabs, Christians, others). </li></ul></ul><ul><ul><li>1.7% population growth vs. 0% to negative growth for Japan and Western Europe. 1% for U.S. </li></ul></ul><ul><ul><li>National density of 320 per/sq km </li></ul></ul><ul><ul><li>Life expectancy: 81 years </li></ul></ul><ul><li>Government </li></ul><ul><ul><li>Middle East’s only democracy </li></ul></ul><ul><ul><li>Stable, multi-party system </li></ul></ul><ul><li>Languages </li></ul><ul><ul><li>Hebrew, Arabic, English, Russian, Romanian, Yiddish </li></ul></ul>
  4. 5. <ul><li>Principle Cities </li></ul><ul><ul><li>Tel Aviv – financial, cultural and tourist center of Israel </li></ul></ul><ul><ul><ul><li>Population – City: 400,000/Metro: 3.2 million </li></ul></ul></ul><ul><ul><ul><li>UNESCO World Heritage Site – Modernist buildings </li></ul></ul></ul><ul><ul><ul><li>Wealthiest city in Israel home to 9 of 15 billionaires </li></ul></ul></ul><ul><ul><ul><li>Beach, café, restaurant, shopping </li></ul></ul></ul><ul><ul><ul><li>Core, plus suburban development similar to U.S. </li></ul></ul></ul><ul><ul><li>Jerusalem – national capital of Israel </li></ul></ul><ul><ul><ul><li>Population – City: 760,000/Metro: 1 million </li></ul></ul></ul><ul><ul><ul><li>UNESCO World Heritage Site – walled city </li></ul></ul></ul><ul><ul><ul><li>March 2010 - Vice President Joe Biden condemned Israel’s recent decision to issue building permits in East Jerusalem </li></ul></ul></ul><ul><ul><li>Haifa, Rishon LeZion, Ashdod </li></ul></ul>
  5. 6. Israel has signed peace treaties with Egypt and Jordan, peace process work in progress, strong military
  6. 12. TSE Symbol Allocation Focus Area Strengths AFPR 25% Industrial and Hi-Tech Park, leading shopping centers Largest portfolio of hi-tech parks in Israel. GLOB 25% 12 shopping centers Average annual return of 20% in past decade. AMOT 50% Central bus stations, supermarkets, shopping centers Stable properties

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