Israel’s real estate landscape has seen years of skyrocketing property prices, dwindling land reserves, and an ever-tightening web of bureaucracy, creating a challenging environment for developers. Improvement levies, local taxes, and a painfully slow planning process erode profitability and stretch return-on-investment timelines that can be beyond what the market can bear. Add to this a persistently high interest rate—driven by ongoing geopolitical instability—and it’s no wonder Israeli developers seem to be increasingly turning their gaze outward.
Abroad, the landscape looks entirely different. In markets like Poland, Greece, and Portugal, developers encounter a combination of regulatory flexibility, affordable land, and lower construction costs. These aren’t just marginal advantages—they’re game changers. As Europe shows clear signs of entering an interest rate reduction cycle, financing options are becoming more accessible, creating fertile ground for new investments.
Poland stands out as a prime example. Its consistent economic growth and efficient urban planning have turned cities like Warsaw and Krakow into magnets for Israeli capital. Meanwhile, Greece’s real estate market—still recovering from its economic crisis—offers some of the lowest property prices in Europe, along with tax incentives and the golden carrot of citizenship by investment. Portugal and Cyprus also remain strongholds of opportunity, providing political stability, investor-friendly legislation, and, in Cyprus’s case, a familiar British-influenced legal framework.
But with opportunity comes risk. Cross-border investments expose developers to unfamiliar regulations, cultural nuances, and the unpredictable behavior of local partners. Currency fluctuations, political upheaval, and the challenge of managing distant projects further complicate the equation. Success abroad demands thorough research, trusted local alliances, and an unwavering commitment to due diligence.
Despite these challenges, Israeli entrepreneurs have left a visible mark on foreign markets. In Poland and Greece, the “Israeli standard” has become synonymous with high-quality construction and innovative urban planning. Israeli purchasing groups—uncommon in many European markets—have introduced new business models and often outcompete local developers in government tenders.
The influx of Israeli capital is also influencing the evolution of these markets. Where once investors diversified between real estate, equities, and venture capital, today, real estate alone offers the most promising path to wealth preservation. But this isn’t just about diversifying asset classes; it’s about geographic diversification.
Looking ahead, Eastern and Southern Europe are set to remain at the center of this trend. These regions offer the perfect storm of developing markets, easing regulations, and a welcoming attitude toward foreign entrepreneurship. In parallel, markets with regulated rental frameworks—like Germany and the Netherlands—will attract developers seeking long-term, stable income streams.
Demographic shifts will also shape future projects. Aging populations and the rise of young urban professionals are creating demand for specialized housing solutions. And as the global affordability crisis deepens, developers will increasingly pivot away from luxury projects in favor of affordable housing and long-term rental solutions.
The rise of crowdfunding platforms—many of them Israeli—will open international real estate investment to smaller investors, further accelerating this global shift. Some countries may attempt to tighten foreign investment controls, but for every door that closes, others will open.
In the end, an Israeli developer’s move abroad is a statement of intent, but also a cry for correcting the ills of the Israeli market. In a global economy that rewards agility and punishes stagnation, those who build beyond their borders may be the ones who shape the skylines of tomorrow, but those very same investors could decide to build in Israel and shape its skyline if the necessary changes were made.
Elchanan Lizerovitzis Founder and CEO of ELG, a real estate investment firm promoting residential and commercial projects across Poland.
