US co Klein International to float TASE bond

Klein property in New York

Jacob Klein's Group is seeking to raise NIS 200-250 million for its New York, New Jersey property portfolio.

The latest in the stream of US real estate companies floating bonds on the Tel Aviv Stock Exchange (TASE) is Klein International Group, founded by Jacob Klein, which today published its first prospectus for a bond issue. It is believed that Klein Group is seeking to raise NIS 200-250 million.

The proceeds from the issue, led by Call Finance Underwriting, are designated for a number of uses, including the purchase of the rights of partners in properties not fully owned by Klein Group, and an investment of up to $15 million in the purchase of the Mercer 85 property. This involves the purchase of 90% of a property located on Mercer St. in Manhattan. An agreement for its purchase was signed in October, with the controlling shareholder undertaking to pay up to $5 million. Under the agreement, the seller undertook to obtain rezoning of the property from residential to commercial within one year of the date on which the agreement was signed. No loan for the property has yet been obtained.

Klein Group also plans to use the proceeds to finance its business, "including additional investments in the group's existing properties and expanding its portfolio of properties, among other things through real estate investments as preferred owner's capital."

The Klein Group has been active in commercial real estate in the US northeast for 20 years, and owns 12 properties in Manhattan and New Jersey, with controlling interests of nearly 100%. Renters in the properties include McDonalds, Starbucks, Citibank, Fedex, and others. Like the other US real estate companies that have raised debt on the TASE (12 companies have raised NIS 8 billion), the Klein Group is also a tax shelter registered in the Virgin Islands.

Published by Globes [online], Israel business news - www.globes-online.com - on November 10, 2015

© Copyright of Globes Publisher Itonut (1983) Ltd. 2015

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Klein property in New York
Klein property in New York
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