May 11, 2005 The globalized Zionist By URIEL HEILMAN NEW YORK It's tough to find Yitzhak Tshuva. When you go looking for him at his company's offices in Netanya, you're likely to be told he's in New York, and when you knock on his door in the Big Apple, it's just as likely he'll be back in Israel. But in the world of business and finance, Tshuva seems to be everywhere. He's running a major new natural gas facility off the coast of Ashkelon, which his company, the Delek Group, discovered five years ago. The power generated from that operation is expected to provide a significant proportion of Israel's electrical needs, reducing the state's dependence on foreign oil. Tshuva is also in Canada, buying, building and renovating condos for sale. He's a star on Tel Aviv's stock exchange, where the Delek Group's share price has risen more than 33 percent since the beginning of the year, the highest increase to date by a Tel Aviv 25 index company. Tshuva is even in Tennessee, where one of his US subsidiary companies operates gas stations and convenience stores. Yitzhak Tshuva-or Isaac, as he's known abroad-is one of Israel's most successful businessmen. He's also one of a growing set of wealthy Israelis who live somewhere between Israel and America, constantly shuttling back and forth in an effort to keep their home in one place but their livelihoods thriving in another. In another age, Israel might have lost Tshuva to the diaspora, where the call of the dollar beckons. Indeed, countless Israelis have relocated to more business-friendly places abroad to secure better incomes and, they hope, better lives. But Tshuva remains a Zionist, even if the rules in Israel are a little harder to play by, and even if it means he must endure a commute across an ocean. "This is my only country, and I'm tied to it and love it, without comparisons to anything else," Tshuva said in a recent interview with Globes, one of the few interviews he has granted in a famously press-averse career. "Despite the difficulties, I'll go on developing and investing in my home country." Tshuva declined to be interviewed for this story. Until recently, the Israeli tycoon, whose major investments include the energy sector, the auto industry and real estate, had been remarkably successful at keeping out of the headlines, despite his considerable business successes. But this winter in New York, Tshuva found himself at the center of a fierce and very public battle over Manhattan's famous Plaza hotel, which he bought in late 2004 from a partnership of Saudi Prince Waleed bin Talal bin Abdul Aziz and the Millennium & Copthorne Hotels company. Tshuva planned to convert most of the landmark hotel into luxury condos, but he quickly ran into staunch opposition from the Plaza's 900-odd workers and hundreds of New Yorkers, Hollywood celebrities and city politicians who were aghast at Tshuva's plans and launched a vigorous public relations campaign to save their beloved hotel. The Plaza is a New York icon, featured in more than 150 major motion pictures. With its sweeping views of Central Park and its ritzy location at the cusp of midtown, the Plaza long has been a favorite among America's upper crust, even as it has become a losing financial proposition. Ultimately, Tshuva blinked first, reaching an agreement with the hotel workers' union early last month to preserve nearly half the Plaza's rooms, more than twice as many as the 150 he originally had planned. He also scrapped his plans to demolish the hotels' famed Palm Court, Oak Room and Oak Bar. Just before the compromise was reached, cosmetics magnate Ronald Lauder, a former chairman of the Conference of Presidents of Major American Jewish Organizations, flew to Israel to try to persuade Tshuva to compromise his original plans. When Tshuva finally gave in after months of pitched battles that made headlines in New York, it wasn't so much a victory for the Americans, or a symptom of the Israeli's weakness in the face of pressure by a key American Jewish player. Rather, in a switch from the old paradigm of the rich American in Israel, it was a sign of how much power Tshuva actually wields in America. The Plaza, which he bought for $675 million, is only one of hundreds of properties Tshuva and his real estate company, Elad, owns. He is a major real estate force in New York City in beyond, and Tshuva's position is growing both in the US and in Israel. In Israel, he negotiated the acquisition of the Sheraton Moriah hotel chain. He owns a significant stake in cable TV. And if you've bought a Mazda or Ford recently in Israel, chances are you bought it from Tshuva. Still, Tshuva says, it's not easy to grow your wealth in Israel. "It's hard to invest in Israel," Tshuva said earlier this year. "Take real estate, for example. The state owns most of the land, and the resulting bureaucracy is delaying its development and raising the purchase cost. It's very painful for me to say this." "In order to right these wrongs and enable overseas entrepreneurs to invest here, the authorities have to encourage and help," Tshuva said. "It's hard for me to persuade businesspeople, including many Jews I meet, to come and invest in Israel. For that to happen you have to equalize conditions to those in the countries where they operate, because the current gap in our disfavor is enormous." Tshuva has not taken the typical route to success in Israel. He buys real estate, not high-tech. He imports cars, not computers. And he does his work quietly, without great fanfare-and without many of the troubles that come with it. While other Israeli businessmen like Yossi Maiman clash publicly with government officials in battles over the energy sector, Tshuva does his work quietly, without much trouble from the government, without making many enemies and without much attention from the general public. Nevertheless, it has been a startling rise for the builder from Netanya turned international Israeli tycoon. By some accounts, Tshuva has been in the right place at the right time, admitting his mistakes quickly and knowing when to cut his losses rather than stick to his guns trying to salvage bad investments. But more likely it's the quiet savvy of a modest, self-made man who has climbed his way into the exclusive club of Israeli billionaires without the myriad connection, bluster and bravado of many of his Israeli counterparts. Yitzhak Tshuva may be a quiet man, but if the last decade is any guide, it's likely we'll all hear a lot about him in the future.