For a long time, Jared Kushner, son-in-law of President Donald Trump, has had his eyes on Israeli insurance and financial group The Phoenix Holdings. It started with an attempt to acquire 25% of the company's insurance agencies, and is about to end soon with Kushner becoming the largest shareholder in Israel's largest insurance company (9.9%). In building his stake, he bought shares from the investment funds that recently exited the company, Centerbridge and Gallatin Point, as well as from his old friend Yitzhak Tshuva.
This investment joins the purchase of 15% of the shares of the Schmeltzer family's holding company, which Kushner 's private equity fund, Affinity Partners, acquired a year ago for $110 million. And it seems that Kushner isn't going to stop there.
Kushner visits Israel frequently, maintains contacts with a host of local businesspeople and politicians, believes in the local economy, and has faith in Israel’s geopolitical situation. The man who started out as a real estate developer, mainly in the New York area, has been building a thriving business empire with strong Middle Eastern roots in recent years. With close ties to Saudi Arabia and the help of Saudi capital, it seems that Kushner's fund, which he established at the end of Trump's first term, is betting heavily on normalization with Saudi Arabia and the "upside " that will come from this for businesses in Israel .
Kushner (44) made his first significant real estate deal while still a Harvard University student in the 2000s. He purchased apartments to the tune of $9 million in a middle-class suburb of Boston, which he sold for double the price after the area underwent gentrification.
In 2005, he took control of the family business (Kushner Companies), after his father Charles began serving a prison sentence for tax fraud and suborning witnesses (Trump later granted him a pardon, and has now appointed him US ambassador to France).
The company, which for decades had invested in residential apartment buildings, began under Jared Kushner’s leadership to focus on small and medium-sized cities in the southeastern US, in part because large investment firms raised prices in the larger cities. Among the company's major deals are an agreement to purchase a five-building complex in Brooklyn Heights in 2013 for $340 million, as well as the luxury apartment tower in Jersey City Trump Bay Street, which opened in 2016 after an investment of $225 million .
But there is no doubt that he has made the leap from real estate developer to investor only in recent years, after Trump finished his first term, and in no small part thanks to the connections he accumulated during his time as a senior advisor to the president in the White House .
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In 2021, he founded his investment company Affinity Partners. From the very beginning, Kushner targeted Gulf sovereign wealth funds. One of the first investors was the sovereign wealth fund of Saudi Arabia, which invested $2 billion. This happened just six months after he left the White House.
In December, Affinity raised $1.5 billion from the Qatar Investment Authority and Abu Dhabi-based asset manager Lunate, according to Bloomberg. With that investment, the total assets under management of Affinity grew to $4.6 billion. It was previously reported overseas that the fund examined more than a thousand different potential investments, and chose to invest in just a handful, fewer than ten, by 2023. Among the rest, it invested $150 million in a search engine for purchasing properties and vehicles, and for finding jobs, in the United Arab Emirates; $200 million in a California company that provides credit for solar energy projects; and $110 million in a fitness technology company from Germany.
According to a recent report in "The Financial Times," the large amount of capital that has flowed into the small company despite his lack of investment experience has put Kushner in a position to reap profits solely from managing the money. With a commission of 1.25% on investors’ capital, Affinity is expected to earn millions of dollars a year in management fees, with most of the money left over after covering operating expenses flowing directly to Kushner, the controlling shareholder.
In a May 2022 interview with "The Wall Street Journal," Kushner said, "If we can get the Israelis and Muslims in the region to do business together, people will focus on common interests and shared values. We have begun historic regional change that needs to be fostered and nurtured."
It’s not just the Middle East that’s in the spotlight. Last December, just three weeks before Trump’s re-inauguration, Kushner received permission from the Albanian government to develop a luxury resort on Sazan, the country’s only island in the Mediterranean. It’s one of Affinity’s best publicized investments to date. Kushner’s plan is to turn former battle sites in Albania and Bessarabia into luxury resorts. Bloomberg reported that Kushner intends to spend more than $1 billion building luxury hotels and homes in these areas, with the aim of attracting the world’s wealthiest.
This investment, like many of Kushner's new business ventures, is accompanied by reports around the world about acquaintances or connections that help him with business under the auspices of the White House, with Saudi figures almost always appearing in the background. But we'll come back to that later.
Between Saudi Arabia and Israel
In early 2021, it was first learned that Kushner was considering operating in Israel, when he raised NIS 100 million debt for the family's real estate activities on the Tel Aviv Stock Exchange. Two years passed before the first notable investment in Israel was made – a month before the war broke out. In September 2023, Affinity invested NIS 570 million in the Shlomo Group, which operates mainly in the automotive sector and was founded by the late Shlomo Shmeltzer. The investment was made for the continued development of the group's automotive and credit activities, at a valuation of NIS 3.8 billion.
The Shlomo Group is privately-held, so there was no need to report the deal. But it seems that since it was the first investment by Kushner's fund, both parties were interested in making it public. A kind of first declaration of entry into Israel.
Although market players were skeptical about the nature of the synergy or shared upside that could arise from the deal, Shlomo Group chairperson Asi Schmeltzer claimed, talking to Calcalist at the time, that the deal would open up opportunities for the Shlomo Group in Arab countries. "This is a strategic opportunity for expansion in the family's companies, the group. The fund is highly respected in Arab countries. There’s no avoiding making peace in our region, and being partners with someone who is connected and respected in the region will give us an advantage in entering these markets," he said.
As far as is known, in the past year and a half the Shlomo Group has not advanced any deals in Arab countries. One of the possible motives for Kushner's entry as an investor in the group was to promote such deals. But of course, the bitter war that broke out here also had its consequences.
In July 2024, Affinity acquired 4.95% of The Phoenix Holdings’ shares for NIS 470 million, and last month received approval from the Capital Market Authority to exercise options for an additional 4.95% of the insurance company's shares – for a similar amount. The foreign fund, which will hold 9.9% of The Phoenix, will become its largest shareholder.
According to market estimates, Affinity Partners has carried out further private transactions in Israel that have not been reported.
Kushner, who played a significant role in the Abraham Accords, does indeed have extensive connections in the Gulf. How unusual his connections are is evidenced by the source of the money he raised for his fund – the United Arab Emirates and Qatar. This is a pretty exceptional fundraising round, not so much because of the amount or the sources, but more because of the combination of sources. The United Arab Emirates and Qatar are in a contest for diplomatic and international influence, as seen in the Gaza Strip, for example. They are also on opposite sides of the fence in the Sunni Muslim battle for influence between the moderate axis and the Muslim Brotherhood axis.
These ties go back years, long before the Abraham Accords. For example, according to international press reports, a company linked to the Qatari government bailed out the Kushner family's real estate company after it fell into heavy debt following the purchase of a 41-floor tower in Manhattan, known as 666 Fifth Avenue. The tower was purchased in 2007, on the eve of the great financial crisis, for $1.8 billion, and for this purpose heavy debt of $1.2 billion was taken on that was meant to be repaid fairly quickly. It is claimed that Qatar's sovereign wealth fund was involved in injecting $1.2 billion to lease the tower for a period of 99 years.
"The New York Times" reported at the time that the Qataris were initially hesitant about making the investment, but went ahead out of the fear that relations with the US administration would be damaged if Trump returned to the White House. This fear was based on the cool treatment they received from Trump at the beginning of his first term, following their refusal to make another investment in the Kushners' real estate company. But towards the end of his term, in 2019, and after the investment they made, Kushner played a central role in discussions on lifting the boycott imposed on Qatar by Saudi Arabia and its allies in 2017.
The Saudi investment in Kushner’s fund in 2021 was also made after hesitation, and after investment advisors advised against the move because of Kushner’s lack of experience and the associated public relations risks. Ultimately, Mohammed bin Salman decided in favor of the investment, which generates more than $20 million a year for Kushner and his partners.
As part of his relationship with Qatar, Kushner combines not only business and government ties but also pleasure – at the 2022 World Cup final, in which Argentina defeated France, Kushner was photographed sitting next to none other than his father-in-law's current ally in government Elon Musk .
Incidentally, according to "The Times," Kushner's relationship with Saudi Crown Prince Bin Salman is also very close and includes regular text messages. Bin Salman even gave him two swords and a dagger worth $48,000 in 2017.
Between Washington and Gaza
In Trump's current term, Kushner is ostensibly an observer on the sidelines, at most a shadow advisor. However, several recent statements by Trump specifically on the subject of the war in Israel and the solution to Gaza the day after indicate the extent of his influence.
A year ago, Kushner proposed a plan remarkably similar to the one Trump is talking about for evacuating Gaza residents from the Strip, and settling them in the Negev or Egypt. "Get the citizens out, then go in and finish the job," he said at the time, claiming: "I know it won't be popular – but it would be the right move."
In an interview he gave to the Harvard Middle East Initiative in March 2024, at the height of the military operation in Gaza, Kushner remarked on the "high-value" potential of Gaza’s seafront properties. "Gaza's waterfront property, it could be very valuable, if people would focus on building up livelihoods," he said.
Incidentally, one of the countries about which it was recently reported that it might accept evacuated Gazans (and which denied the report) is Albania, yes, the same Albania where Kushner is building a luxury resort.
In an in-depth interview with the "Invest Like The Best" podcast published last December, Kushner laid out his plans in advance of Trump's return to the White House, and promised a dramatic expansion of the Middle East peace circle with one clear goal – an agreement with Saudi Arabia. "The agreement with Saudi Arabia will be the key," Kushner says in the interview, "because ten other countries will join right after it, including Pakistan and Indonesia. We had many countries eager to join." Here too, the economic motif recurs: "Our vision was to create one economic bloc linking the port of Haifa in Israel to Muscat in Oman, allowing people to trade, transfer technology, and invest in one another," he said.
"Kushner is a man motivated by love of Israel and a desire to make the Middle East a better place," explains Yaki Dayan, former Israeli consul in Los Angeles and chief of staff to foreign ministers Silvan Shalom and Tzipi Livni. "Kushner recognizes opportunities, but it’s not the business opportunity that drives him, and it’s not contrary to American interests."
Dayan confirms that Kushner still has Trump's ear, including on the issues of the solution in Gaza and normalization with Saudi Arabia. "He doesn't sit in the administration every day like in the first term, but he hasn't retired. His direct access to the president allows him to skip the hierarchy, and also to talk to other officials in the administration if he wishes."
Kushner's hive
Kushner is surrounded by a small group of managers in his investments in Israel and generally. "He has built himself a hive of professionals, people with substantial business experience in managing private investment funds," explains a senior business source we spoke to. "Investments are not made swiftly or suddenly, but rather after in-depth study. It's not that Jared Kushner comes to a conference room, hears the details, and says yes or no," the source says.
One of the most prominent people in the hive is Bret Pearlman, who led Kushner's investment in The Phoenix. Pearlman is a partner in Affinity and a member of the fund's investment committee. Before joining Affinity, he served as head of a family office specializing in private investments called HRS Management. That family office would invest in mid-sized companies in a variety of industries. At the start of his career, he worked as an analyst at investment giant Blackstone, where he spent 14 years in various positions, ending up as a senior managing director.
On his LinkedIn page, Pearlman describes the aim of Affinity Partners as "to make growth investments in market-leading companies, based in their home country with an increased focus on the Middle East."
For the past two years, alongside Pearlman, Luis Videgaray Caso, a former minister of foreign affairs and minister of finance in Mexico, has also served as a partner. Videgaray Caso is also a lecturer at the Sloan School of Management in the Massachusetts Institute of Technology (MIT). "Luis works alongside Kushner, and more than once I've heard him ask for his advice. I assume he really values his opinion," says an Israeli business executive who is in contact with Kushner.
Videgaray Caso is thoroughly au fait with international business. He holds a doctorate in business administration from MIT, and has attended the annual World Economic Forum in Davos.
In some of his business transactions in Israel, Kushner is represented by Eric Herschmann, an Israeli-American attorney who also served as a special advisor to President Trump. Herschmann lives part of the time in Neve Tzedek, and is married to Orly Genger, an artist and the daughter of businessman Arie Genger.
What of the future?
Kushner has visited Israel a great deal in recent years and, according to insiders, he usually divides his time between Tel Aviv and Jerusalem. Businesspeople with whom he is in contact say that he is constantly looking at deals in Israel – but not just that. "Kushner has a perspective that is a product of the Abraham Accords, and the desire to continue to promote their spirit," says a business executive who knows Kushner, "but he is really not limited to investing in the Middle East. He can also invest, for example, in Croatia, the Balkan countries and other regions. In other words, it’s not just a matter of investments in Israel."
So what is Kushner's fund interested in today? "Affinity sees the potential for Israeli leadership in AI. They see potential for growth in Israel. They have been very focused on the subject from what I know, and may have already made initial investments," says the same source, claiming that the large investments that have been made openly are only part of Affinity's activities in the country.
Apart from technology, it is believed that projects with a geopolitical dimension interest Kushner as well, given his close connections with the Gulf states. Kushner’s people are said to have been involved in the deal whereby Aaron Frenkel sold half his holding in the Tamar gas reservoir to Azerbaijan's state-owned oil company SOCAR.
"I can’t undertake that we’ll see more deals after the major investment in The Phoenix," says a well-informed source, "but I can say they are examining things in Israel all the time. As a normalization agreement with Saudi Arabia gets closer, their business profile in Israel will probably grow."
Jared Kushner
Personal: 44 years old, married to Ivanka Trump, with three children. Born in New Jersey, and currently lives in Miami Beach. Grandson of Holocaust survivors from Belarus.
Professional: Head of investment fund Affinity Partners, which manages assets worth $4.6 billion. Owner of real estate company Kushner Properties and of "The New York Observer" newspaper. Served as a senior advisor to his father-in-law, Donald Trump, on Middle East affairs. Graduate of Harvard University.
One more thing: He was nominated for the Nobel Peace Prize for his role in the Abraham Accords.
Published by Globes, Israel business news – en.globes.co.il – on March 4, 2025.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2025.
