The Harel Insurance and Finance Group is completing a lengthy process to realize the sale of multi-family properties located in the western United States for a total consideration of approximately $ 645 million.
During 2015, the Harel Group, in partnership with a number of American institutional entities and a management company, TruAmerica, acquired a portfolio of 14 residential properties (Multifamily, in the western United States (Seattle and Portland) and one property in Utah for a total of approximately $ 408.5 million. Transaction expenses and capital investments, the total cost of the transaction in the amount of approximately $ 462 million. Harel’s share in the rights was approximately 44% and the equity in the transaction amounted to approximately $ 72 million. The portfolio includes approximately 2,950 housing units in 14 different properties ranked Class B. The business plan included, among other things, the improvement of assets, including making capital investments to improve internal and external housing, raising rents and increasing occupancy rates.
The process of selling the portfolio took place in two stages, with the last stage of the sale being completed in February 2021, according to which about half of the portfolio was sold to one of the largest real estate companies in the world as a group of assets. – 20%, and a cumulative profit of about $ 100 million to its policyholders. The sale of the portfolio is a successful realization and a continuation of other realizations of the Harel Group’s real estate assets in recent years outside Israel at double-digit annual yields ranging from 15-20%.
In addition, the Harel Group recently completed another $ 100 million investment in the TruAmerica Real Estate Fund, which specializes in investment management and locating multifamily assets in the United States. TroyAmerica currently manages a portfolio of assets of over $ 11 billion. The fund will focus on assets that are characterized by poor performance and have the potential for improvement in a number of selected markets in the US, Harel invests alongside a number of leading American institutional entities.
Itzik Twill, Director of the Credit and Real Estate Division in the Investment Division of the Harel Insurance and Finance Group He stated that: “The realization of the current portfolio transaction, along with the continued investment in the fund in the management of TruAmerica, are further examples of the accumulated experience of Harel’s real estate system, in making real estate investments in the United States and their realization. Harel continues its ongoing activities to locate income-producing assets with the potential for improvement that are appropriate for the mix of the company’s income-producing assets portfolio in Israel and abroad as part of the desire to spread the investments geographically and sectorally in the best possible way. “