January 20, 2007 / 8:13 PM / 12 years ago

Israel's Polar Inv to invest $1 bln over two years

TEL AVIV, Dec 13 (Reuters) - Israel’s Polar Investments PLR.TA plans to invest about $1 billion over the next two years in real-estate projects, much of it overseas, its new American shareholder said on Wednesday.

Last week U.S. real estate developer Ziel Feldman, co-founder of Property Markets Group (PMG), agreed to acquire 40 percent of Polar Investments, the real estate arm of the Shrem Fudim Kelner SFK.TA group, for about $50 million.

Feldman, who has a one-year option to raise his stake to 52 percent, said a main focus would be in Eastern Europe.

“We hope to invest $1 billion over the next two years,” Feldman, who will serve as president of Polar, told a news conference. “Most of the activity I am looking at is international.”

He added that he sees potential in Israel’s commercial real-estate market.

Because of Israel’s proximity to Eastern Europe, Polar can serve as a vehicle for investing in cities such as Budapest and Bucharest. Feldman said this would be difficult to do through U.S.-based PMG, which has about $3 billion in assets.

The Eastern European market has a great deal of potential, he said, as land and building costs are just a fraction of what they are in the United States.

He also said that Vietnam and Cambodia were opening up.

Polar officials said the company would benefit from Feldman’s international expertise, which would boost the company’s valuation.

Polar plans to focus on leisure operations, such as hotels and theme parks, in Europe and North America; commercial operations; real-estate development in Israel and abroad; and infrastructure.

Feldman said he decided to become active in overseas real estate because of changes in the U.S. market.

“I thought the market was a bit overpriced in the U.S., especially in Manhattan,” he said.

Polar has been working for several years with Feldman in the United States and they are partners in developing the Hard Rock music theme park in Myrtle Beach, South Carolina, a $370 million project that also includes Africa Israel Investments (AFIL01.TA).

Feldman said he has a franchise to build four more Hard Rock theme parks around the world, adding that Moscow was a potential site for such a park.

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