Omer Amsel Omer Amsel, StraightUp's founder and COO

NEW YORK—Omer Amsel is the founder and COO of StraightUp, a crowdfunding platform that provides investors access to curated New York real estate development projects. It was originally incubated by HAP Investments, where Omer's brother, Nir Amsel, is a co-founder and CEO-Israel. Nir opened the first and only branch of an Israeli law firm in the Ukraine in 1999 and is also the CEO at StraightUp. Quite familiar with Israeli business and investments, Omer provides his market insights.

GlobeSt.com: What is the nexus of StraightUp to Israeli investors?

Omer Amsel: StraightUp was born in Israel. We've spent the last three years syndicating funds from private investors internationally and in Israel for the most part. In our experience, American and Israeli investors aren't that different. Both tend to be very forward thinking with their investment choices. Funding over $70 million in equity and totaling our investment assets at around $1 billion, we've found the market very receptive to institutional grade real estate assets, democratized for the people.

GlobeSt.com: In February 2015, the Wall Street Journal reported that several major real estate investors in New York were heading to Israel to raise cash. In August 2016, Haaretz reported Israeli investors were particularly interested in the US multifamily market. Where is Israeli market interest today?

Amsel: There was about $2 billion worth of Israeli investment in New York City in 2015. That number dropped to $130 million in 2016. I expect when the 2017 numbers are reported, they'll be in line with 2016. That said, we estimate that Israeli investment will rebound in 2018, spring-boarding back to a mark closer to $1 billion in New York real estate. And, just to be clear, these numbers don't count indirect methods of investment, like US real estate companies raising bonds on the Tel Aviv Stock Exchange. About $3 billion was raised by that in 2017 alone.

GlobeSt.com: Haaretz had stated after the US financial crisis in 2008, American institutions were hesitant to invest in real estate which left the market open for foreign investors. The article noted after the mortgage crisis, Israeli investors pursued some of the resulting deals. What are Israeli investors looking for today?

Amsel: Pretty much the same things that domestic real estate investors are looking for–especially when it comes to the high profile, Manhattan-based, luxury real estate offerings. They're looking for low-risk, high potential investments. They're also looking to invest alongside developers who have skin in the game. That gives them faith that everyone's interests are wholly aligned.

Manhattan has an aura that people want to buy into, literally and metaphorically. But it's statistically justified. Even in the face of market downturns, New York City, Manhattan in particular, has shown tremendous strength, growing when everything else is contracting.

GlobeSt.com: Are there any laws that promote Israel investment in US real estate or create challenges?

Amsel: There are a few factors to consider throughout the investment's supply chain. First of all, the Israel Security Authority is very stringent when it comes to alternative investments. The only way you can market that kind of offering is by publishing a full-fledged prospectus. It makes exploration in the field somewhat difficult. Investors also have to file a W-8 and expose themselves to the IRS, though that's mitigated by the US and Israel's tax treaty, assuring investors will not pay double taxes.

GlobeSt.com: Who are the biggest players in terms of Israeli investors in New York City?

Amsel: That's one of those things where the biggest players often try—and succeed—in being as discreet as possible. But the numbers speak for themselves. Generally, there are three types of investors: people who've bought into US real estate bonds available on the Tel Aviv Stock Exchange; Israeli developers who are operating in New York; and private investors who have money in alternative funds syndicating equity.

GlobeSt.com: What other factors drive Israeli investments in the US up or down?

Amsel: Interest rates, access to capital and general liquidity are the main issues that drive investments into US real estate from foreign investors. In our experience, there are also psychological factors that influence the investor's state of mind, especially when you're putting your money in a project in a different continent. We're big believers in transparency, making sure investors are aware of any and all developments within their investments.

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Betsy Kim

Betsy Kim was the bureau chief, East Coast, and New York City reporter for Real Estate Forum and GlobeSt.com. As a lawyer and journalist, Betsy has worked as the director of editorial and content for LexisNexis Lawyers.com, a TV/multi-media journalist for NBC and CBS affiliated TV stations in the Midwest, and an associate producer at Court TV.