U.S. Real Estate Leads Issuance Surge on Tel Aviv Stock Exchange

As commercial real estate companies look to diversify funding sources in a volatile climate, the Israeli debt capital markets are meeting the moment. 

Global issuer activity on the Tel Aviv Stock Exchange (TASE) reached a record high of nearly $4 billion in volume for 2025, a 46 percent year-over-year increase, aided largely by the commercial real estate market. Around 80 to 90 percent of the issuance is derived from real estate firms attracted to more favorable yield spreads on Israeli government bonds compared to U.S. Treasurys, according to Michael Nevo, CEO of Leader Global.

Nevo, who leads bond offerings for U.S. real estate firms on the TASE, said the momentum has been driven in part by overall Israeli market growth where indexes outperformed global peers last year despite an ongoing war with Hamas in Gaza. He noted that the biggest catalyst for the increase is the TASE providing financing options to real estate firms not available in the U.S. with more flexible loan-to-value structures.

“Reputable global issuers who entered the market such as Greystone, UMH Properties, Silverstein Properties and many others can enjoy a sizing and credit rating arbitrage, with local Israeli ratings typically five to six notches higher than global ratings, allowing issuers to secure investment-grade pricing at the corporate level,” Nevo said. “As a result, midsize firms gain access to a competitive public debt market, which is, typically, in the U.S. and Canada dominated by large publicly listed REITs.” 

As Nevo noted, plenty of familiar names are transacting today. 

Lightstone was ahead of the curve in terms of opportunities in Tel Aviv with a $120 million debut of unsecured bonds backed by U.S. property holdings in December 2014 as part of a $348 million cumulative Series A offering that closed through 2016. The real estate company then completed a $103 million Series B offering on the TASE in early 2020 after initially intending to raise $73 million for it. 

Lightstone has remained active with the TASE market since 2020, including closing a $110 million offering in mid-February.

Silverstein Properties was also an early adopter of accessing the Israeli bond market and has raised more than $600 million to date. The developer first entered the Israeli capital markets with a $200 million bond offering in May 2018 before expanding by $50 million in February 2019. It issued around $100 million of unsecured bonds in 2025.

Greystone has embraced the TASE as well, raising roughly $160 million of unsecured debt in December 2024 with the goal of utilizing proceeds to invest in new bridge loans. The lender, which was the first real estate credit issuer to access the Tel Aviv exchange, initially had been targeting a $100 million offering that got upsized due to strong investor demand.

“We viewed TASE as a complementary funding source within our broader capital markets strategy,” said Ross Gusler, managing director of corporate finance and capital markets at Greystone. “The economics were compelling, driven by strong institutional demand in Israel for highly rated, publicly listed bonds and a limited supply of comparable issuers.” 

The late 2024 Greystone TASE offering benefited from its high Aa3 investment-grade credit rating along with confidence from Israeli institutional investors in the firm’s bridge-to-agency lending strategy, which has originated over $15 billion since 2004. 

In the past decade, the Israeli bond market has drawn over 50 global issuers who have raised in excess of $20 billion through bond offerings on the TASE involving more than 130 bond series over that period, according to data from Leader Global. 

Issuance on the TASE has spiked more than four times since 2022 with nine new issuers entering the market for the first time in 2025, up from one or two new entrants per year from 2022 to 2024, Leader Global data shows. 

The new TASE entrants featured six from the real estate space: Agellan Commercial REIT, American Equity, Amtrust RE, Simad Holdings, Peakhill and Lanterra Canada. 

Gusler said Greystone executed a follow-up $193 million issuance of Series A unsecured bonds in early February that drew strong demand from institutional investors, and the company hopes other CRE lenders decide to join the trend. 

“We view TASE as a strategic and scalable funding channel,” Gunsler said. “Broader issuer participation strengthens the market and reinforces TASE’s role as a global destination for institutional credit capital.” 

Secured offerings on the TASE securitized by first-lien real estate in North America accounted for roughly 25 percent of issuances last year, down from 30 percent in 2024, which Nevo said signals that issuers view the Israeli market as an alternative for secured financing as banks remain “relatively conservative.”

Looking ahead to 2026, Nevo is projecting issuance volume to grow to $4.4 billion aided in part by issuers looking to refinance their existing bonds in addition to deals from existing issuers and new market entrants. Nevo noted the Israeli capital market showed “resilience” last year despite geopolitical tensions in Gaza and with conditions improving in October following a ceasefire announcement. 

The TASE is also poised to gain business this year after the stock exchange switched in early January to a Monday-to-Friday trading week from its previous Sunday-to-Thursday schedule in order to align with the U.S. and the rest of the world.  

“The sharp rise in global issuers activity on TASE has been driven primarily by U.S. and Canadian real estate firms seeking diversification of funding sources and more efficient capital structures,” Nevo said. 

The roots of the growing U.S real estate presence with Tel Aviv bonds dates to a 2008 mandatory worker pension law in Israel that included a component requiring pension systems to invest in investment-grade bonds for companies that were listed on the TASE. 

Peter Schwartz, a partner in King & Spalding’s London capital markets practice, said the pension act requirements coupled with the number of Israeli companies shrinking on the TASE at the time created opportunity for the emergence of U.S. real estate firms in the Israeli capital markets. 

“The way that the Israeli rating agencies looked at foreign companies and particularly real estate companies is they would give them basically a five-notch difference in the ratings between what they would get in the global scale and what you get in in the Israeli scale,” said Schwartz, who has worked on a number of bond issuances on the TASE. “You got a much lower cost of funding for a subordinated instrument that was too good to pass up for these real estate companies.”

Schwartz noted that from 2014 to 2018 there was a surge in real estate firms accessing the TASE with unsecured debt, including Related Companies, the Moinian Group and Silverstein. While some hiccups emerged — like Starwood Capital Group defaulting on a $245 million Israeli bond issuance in May 2020 tied to U.S. malls — Schwartz said many real estate firms have managed to continue accessing the TASE by retooling to a more secured structure to improve their credit ratings. 

This year is already shaping up to be an active one for the TASE from the U.S. real estate industry, according to Schwartz, with two real estate investment trusts recently asking him about the platform while indicating they plan to access the market for the first time. 

Nevo noted that long-term asset managers in Israel have benefited from a surge of deposit inflows backed by the Mandatory Pension Act, which has boosted assets under management since 2014 by 260 percent, or more than $1.1 trillion. He said the pension law combined with a strong appetite from Israeli investors for exposure to U.S real estate assets will help fuel further growth on the TASE.

“The Israeli economy is not large enough to absorb all incremental capital, driving demand toward globally diversified alternative investments, including direct lending and investments in U.S. real estate,” Nevo said. “Israeli investors tend to have higher exposure to real estate, as reflected by the sector’s market share of roughly one-third of the bond market, compared to lower levels in the U.S.” 

Andrew Coen can be reached at acoen@commercialobserver.com.