In 2011, Canadian billionaire Hershey Friedman acquired Azorim, a major Israeli real estate developer on the verge of bankruptcy, for NIS 300 million. Today, the company is valued at approximately NIS 5 billion, a more than tenfold increase, making it a dominant force in a housing market defined by high prices and growing demand.
Friedman, a 75-year-old entrepreneur from Montreal, has not only revived the company but has also strategically repositioned it to tackle some of Israel's most pressing housing challenges, from urban renewal to the creation of a stable long-term rental market.
Key Takeaways
- Hershey Friedman acquired a struggling Azorim in 2011 and transformed it into a NIS 5 billion market leader.
- The company has shifted its focus to large-scale urban renewal projects and has made Jerusalem its central development hub.
- Azorim is expanding into new sectors, including managed long-term rental properties and micro-logistics facilities.
- Friedman's strategy involves building entire communities with amenities like schools and synagogues, not just residential towers.
From Near-Bankruptcy to Market Leader
When Hershey Friedman took control of Azorim 15 years ago, the company was in a precarious position. Founded in 1964, the once-premier residential developer had overextended itself with international projects and was facing insolvency. Friedman purchased a 64 percent stake in the business for NIS 300 million (about $96.3 million at the time).
The timing was challenging. The purchase occurred just before widespread social protests in Israel over the high cost of living, with housing prices having already jumped 50% in the preceding four years. Friedman described the company's situation as so dire that he had to inject significant additional capital within the first two years to keep it afloat.
"To turn around a company normally takes three to five years," Friedman stated. "Slowly but surely, we started to make major changes."
The first step in the turnaround was to divest from overseas assets and refocus entirely on the Israeli market. The company then pivoted toward acquiring land for new developments and, crucially, began to specialize in large-scale urban renewal projects.
What is Urban Renewal in Israel?
Known as pinui-binui (evacuation and reconstruction), this model involves demolishing older, smaller apartment buildings and replacing them with modern high-rise towers. This process increases housing density in central urban areas, a key strategy for addressing Israel's housing shortage.
Today, Azorim has a portfolio of over 70 projects, with 40,000 residential units either completed or under construction. The company is now ranked third among publicly traded developers in Israel by revenue, according to the Dun’s 100 annual ranking for 2024.
A Strategic Bet on Jerusalem
About five years ago, Friedman and Azorim made a pivotal decision to concentrate their efforts on Jerusalem. The company is now involved in approximately 20 projects in the capital, with at least 10 more land parcels in advanced planning stages.
"Jerusalem has always been at the center of Jewish life," Friedman explained. "So about five years ago, we decided to put our concentration there."
One of the most significant of these developments is the "Melach Ha’aretz" (Salt of the Earth) complex near Kibbutz Ramat Rachel. Described as an "ultra-exclusive" project, its first phase includes 374 units, with long-term plans to build nearly 1,000 apartments.
However, Friedman emphasizes that luxury projects are not the company's sole focus. The strategy is to tailor developments to specific communities, whether they are secular, religious, or international buyers. Foreign clients now account for roughly 20% of Azorim's sales.
Building Communities: Azorim's projects often include public amenities like synagogues, schools, parks, and gyms, built in cooperation with municipalities. Friedman estimates he has personally financed the construction of 25 to 30 schools across Israel.
"We are not just putting up a building with nothing around it," he said. "We look at each project and ask what will attract and serve the people who live there."
Beyond Homebuilding: New Ventures in Rentals and Logistics
As Israel's housing market evolves, Azorim is expanding into new and underserved niches. One of the most significant is the long-term rental market through its subsidiary, Azorim Living.
With home ownership becoming increasingly difficult for many Israelis, the rental market has grown substantially. Data from the Central Bureau of Statistics shows that about 30% of Israeli households were renting in recent years, up from 24% in 2013. Azorim Living participates in a government initiative that provides developers with discounted land in exchange for a commitment to rent out the resulting apartments for 20 to 30 years.
This model aims to create a more stable rental market, which has traditionally been dominated by small, private landlords. According to company officials, this move reflects a "long-term view of the housing market and the structural demand for quality rental housing."
Another innovative venture is in micro-logistics. Friedman is applying his decades of experience with industrial properties in North America to a new concept for Israel: multi-story buildings divided into small workshops and manufacturing spaces as compact as 200 square meters.
"Most companies are looking at 5,000-10,000 square meter spaces for institutional use," Friedman noted. "This is about... small sections for people who need their own little factories and spaces." This model is designed to serve small and mid-sized producers who are often overlooked in the industrial real estate market.
A Philosophy of Turnarounds and Giving Back
Friedman's business career began long before Azorim. After selling his family's textile business at age 31, he built a reputation as a corporate turnaround specialist by acquiring and rehabilitating struggling plastics companies in North America.
He applies a similar philosophy of revitalization and community contribution to his work in Israel. Friedman is a long-time philanthropist, supporting hospitals and religious institutions. After the October 7, 2023 attacks, he provided fully furnished apartments to displaced families from southern Israel free of charge.
This approach was also evident in his 2009 acquisition of Agriprocessors, North America’s largest kosher meat company, after it collapsed following a federal raid. He said he was motivated by a desire to stabilize the kosher meat supply for the Jewish community. The company, now renamed Agri Star Meat & Poultry, was modernized and made profitable.
Reflecting on his career in business and real estate, Friedman shared a simple guiding principle that connects his commercial ventures with his philanthropic efforts.
"You can’t only take, take, take," he concluded. "You also have to give back."
