Two major United States life insurance companies have invested $4, 500, 000 in a new, $10, 000,000 project for the construction of 2,000 new housing units in Israel, it was announced here today.
The two firms, the Massachusetts Mutual Life Insurance Company and the New England Mutual Life Insurance Company, provided the funds to American Associates, newly formed corporation of which Jack D. Weiler is chairman, on 15-year notes, guaranteed by the Jewish Agency for Israel, Inc., which will lease the units to be constructed. Additionally, American Associates will provide $1, 000, 000 of its own capital, and will have $4, 5 million proceeds of subordinated capital participation by an agency of the Israel Government. The guarantees make it possible for the first time for American insurance companies to provide funds for immigrant housing in Israel through American-based corporations.
The $10,000,000 which American Associates will provide will finance construction of 2, 026 housing units, accommodating about 10, 000 persons. American Associates will buy these units from the Israel Housing Authority and lease them to the Jewish Agency for Israel, Inc., for distribution to new immigrants. The units will be in the two newly developed towns of Ashdod and Ashkelon, on the Mediterranean.
STONE, WEILER LAUD PIONEERING NATURE OF METHOD FOR INCREASING IMMIGRANT HOUSING
Dewey D. Stone, chairman of the Jewish Agency for Israel, Inc., noted today that the project pioneered a method of obtaining loans in the United States to finance immigrant housing against rent guarantees to be extended on behalf of the new immigrants by the Jewish Agency out of its share in the nationwide United Jewish Appeal.
Mr. Weiler reported that “this new way of putting part of our housing budgets on a rental basis will make it possible to substantially increase the number of housing units available for new immigrants in the current fiscal year.” He indicated that the establishment of American Associates paved the way for an increased mobilization of commercial capital for immigrant housing in Israel.
Associated with Mr. Weiler in American Associates are Irwin S. Chanin, Laurance Tisch, Louis Glickman, Lawrence Schacht, Charles B. Benenson, Aaron Chilewich, Ira Guilden, Samuel Lemberg and Solomon N. Petchers. Negotiations for formation of American Associates and for the insurance company loans were conducted by Gottlieb Hammer, executive vice-chairman of the Jewish Agency for Israel, Inc., and Maurice M. Boukstein, counsel for the Jewish Agency.
Final agreement between American Associates and the Israel Housing Authority was concluded this morning, at 4 a.m., over a two-way teletype circuit.
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