TEL AVIV Aug 22 Israel's Harel Insurance Investment and Financial Services entered into a joint venture with SL Green Realty Corp to establish a second student dorm tower for Pace University in downtown Manhattan.
SL Green is a commercial real estate investment trust (REIT) in New York City.
This new building follows construction by the partnership of a 609-bed dormitory for Pace at 180 Broadway.
The $112 million project will be financed through the partnership's equity and bank financing and is expected to generate an annual return of over 7 percent.
Construction is due to begin in April 2013 and completion is scheduled for August 2015.
"The student dorm market in Manhattan is a stable market characterised by significantly lower supply than demand and a particularly high occupancy rate," said Gadi Ben-Haim, head of Harel's real estate division. "These statistics helped the partnership formulate a transaction that generates an above average return with potential for significant increase in value."