Middle East investors drawn by US property as returns lag at home

New York

THE boarded-up building sat vacant on a tattered block in San Francisco until a small New York developer and a Kuwaiti real estate partner snapped it up in April 2014, attracted by the proximity to Twitter and other tech companies.

Over the next 18 months, New York's Synapse Development Group worked to win approval to redevelop the 1904 landmark on Market Street into a 203-room hotel run by London-based Yotel.

The Kuwait Real Estate, or Aqarat, later approached Synapse to deepen the two firms' ties as general partners, and they plan to invest US$25 million in the future. They are working on a project in the Williamsburg section of Brooklyn, and Synapse is eyeing other US urban markets for future deals. Synapse and Aqarat aim to leverage their capital with an outside inve…