Private investment funds deriving most of their financing from the huge amounts managed by investment institutions for the Israeli public are expanding. Sources inform "Globes" that David Netzer, Dani Zabar, and Linda Ben Shoshan are currently working on the establishment of the Forma investment fund, which will invest in real estate in Western and Central Europe. The planned fund will have $150-200 million in capital.
The sources added that the anchor investor in the planned fund is the Menorah Mivtachim Holdings Ltd. (TASE: MORA) insurance group, whose investments are managed by Yoni Tal. As far as is known, Menorah Mivtachim is slated to invest $40 million in the fund. As of the end of the third quarter of 2016, Menorah Mivtachim managed NIS 85 billion in assets.
The Forma fund will invest in income-producing real estate, among other things in Italy and Switzerland. The fund is currently contacting investors in order to meet its funding targets. Among other things, it is in touch with the Altshuler Shaham investment house, which as far as is known is considering the investment, and is likely to make a large-scale investment in the fund.
Ben Shoshan is a director at Israel Discount Bank (TASE: DSCT). Among other things, she has served as CEO of the Hadas Arazim Investment House and executive VP of Discount Bank's asset management division. Zabar and Menorah Mivtachim have had a good record with fine returns in their joint real estate investments in the Netherlands.
Private investment funds, such as private equity funds, hedge funds, and others, have been gaining momentum in the local market in recent years. One major reason is the enormous growth in large institutional investors managing huge sums. These institutions use external experts to attain a high return that will be as independent as possible of what happens in the marketable capital markets.
At the same time, investment institutions have been investing in real estate, both in Israel and overseas, in recent years as part of the diversification of their investment portfolios, while creating an engine for a stable return and cash flow.
A private real estate fund meets these needs: both the institutions' need to expand their investment instruments to non-financial instruments and their need for a relatively stable return.
Published by Globes [online], Israel business news - www.globes-online.com - on December 28, 2016
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