Aya New York Secures $104M U.S. Refinancing Deal to Exit Israeli Bond Market
Aya New York signed a $104M refinancing deal with a major U.S. bank, replacing its 292M shekel Israeli bond debt. The firm will repay bondholders in full ahead of schedule to focus on core Manhattan real estate operations.
Aya New York, which operates in the fields of investment real estate and hospitality in Manhattan, has signed a memorandum of understanding for a refinancing deal of $104 million with a leading major American banking corporation. Under the agreement, the company will replace the financing it raised in Israel earlier this year, amounting to approximately 292 million shekels. The company will repay the debt in exchange for the bond liability value (principal plus interest accrued until actual redemption), about two and a half years ahead of the original maturity date.
The decision was made on the company's initiative as part of a reassessment of its financing structure, after recently receiving several financing offers from leading U.S. banking institutions and advancing a banking financing alternative. The financing process is being led by international real estate giant JLL.
Core Strategy and Portfolio
The strategy of Aya New York focuses on prime areas in Manhattan with a specialization in acquiring luxury assets from receivership where it performs rapid value-add improvements. The company has developed the ability to complete due diligence and close deals in very short timeframes, allowing it to acquire top-tier design and operational assets at a significant discount to market value.
To date, the company's asset portfolio includes five income-producing properties in prime Manhattan locations, comprising three multifamily residential properties and two hotels. Notable properties include Riverside on the Upper West Side—two buildings featuring 82 residential units where the company performed envelope restoration and thorough renovations; Renoir House on East 63rd St—a residential building with 151 units where the company executed planning changes and value-add upgrades; and Hotel Lady D between Fifth and Sixth Avenues in the heart of Midtown Manhattan, featuring 166 rooms and approximately 9,000 square meters of commercial space, operating within a prestigious 48-story residential tower.
Shifting to U.S. Banking Markets
AYA's decision to repay the debt owed to Israeli holders stems from the understanding that maintaining public debt in Israel would burden the company's desired growth rate. The background to the decision included negative sentiment in the local capital market toward real estate companies incorporated in the BVI, despite the substantial differences between Aya and those companies, as well as the high quality of its assets and collaterals provided to bondholders. Therefore, the company decided to invest its time and resources into its core operations: identifying, acquiring, upgrading, and managing real estate assets in New York.
Under the emerging framework, the bonds will be redeemed in full, including principal and accrued interest up to the actual redemption date, at a price of 100 agorot (par value). The company commits to executing full redemption within 45 days from the date of the bondholders' meeting approval, with the right to extend this period by an additional 30 days subject to written confirmation from the financial institution that it is in the midst of the financing process.
"We came to the Israeli capital market with significant plans for the company's growth, and we appreciate the trust we received from the public," said Amir Shariki, controlling shareholder of Aya NYC. "Today, we believe it is right for AYA to rely on U.S. banking financing sources, which we have successfully utilized in the past. AYA's ability to swiftly secure significant financing from leading international financial institutions reflects the quality of our assets and our business resilience."
