No more secrets in luxury real estate: US to regulate use of LLCs in Manhattan, Miami

Program would monitor transactions and identify buyers

TRD LOS ANGELES /
Jan.January 13, 2016 09:04 PM

All-cash purchases of luxury apartments by anonymous shell companies, increasingly common in high-end real estate deals, may soon be a thing of the past.

The U.S. Treasury Department is rolling out a program in New York and Miami to monitor those transactions and identify buyers, starting in New York and Miami, the New York Times reported.

“We are concerned about the possibility that dirty money is being put into luxury real estate,” the Treasury’s Jennifer Shasky Calvery told the newspaper. “We think some of the bigger risk is around the least transparent transactions.”

In transactions above $3 million, the government will require title insurance companies to discover buyers’ names and submit the information to a database that Treasury will make available to law enforcement.

In Manhattan, 1,045 apartments were sold above that price level in the second half of 2015, worth about $6.5 billion in total, according to data from PropertyShark.

It will be the first time the federal government has required this sort of disclosure in real estate transactions, though the city launched its own attempted to lift the “veil of secrecy” around luxury real estate buys earlier this year.

The program will run on a trial basis from March through August of this year. It will become permanent nationwide if officials discover sufficient evidence of money laundering in the data.

Just last week, an entity called LLC, 432 PARKVIEW became the first buyer at Harry Macklowe’s 432 Park Avenue in Midtown. It bought a three-bedroom, 4,000-square-foot unit for $18.1 million. [NYT]Ariel Stulberg

Correction: A previous version of this article said that 1,045 Manhattan apartments above $3 million were sold in 2015. That was actually the number sold in the second half of 2015. 


Related Articles

arrow_forward_ios
National Cheat Sheet: The West Coast dominates US crane count, Zillow’s market cap passes $10B … & more

National Cheat Sheet: The West Coast dominates US crane count, Zillow’s market cap passes $10B … & more

National Cheat Sheet: The West Coast dominates US crane count, Zillow’s market cap passes $10B … & more
Florida leads US in foreign residential purchases

Florida leads US in foreign
residential purchases

Florida leads US in foreign
residential purchases
Why rich people collect passports like it’s nothing

Why rich people collect passports like it’s nothing

Why rich people collect passports like it’s nothing
Blame Canada: Surge in foreign buyers pushing home prices up

Blame Canada: Surge in foreign buyers pushing home prices up

Blame Canada: Surge in foreign buyers pushing home prices up
Swiss bank Credit Suisse buys Glendale office for nearly $59M

Swiss bank Credit Suisse buys Glendale office for nearly $59M

Swiss bank Credit Suisse buys Glendale office for nearly $59M
Qatar is so filthy rich that even its servants have a $41M mansion

Qatar is so filthy rich that even its servants have a $41M mansion

Qatar is so filthy rich that even its servants have a $41M mansion
Cash isn’t the only way for offshore buyers of US real estate

Cash isn’t the only way for offshore buyers of US real estate

Cash isn’t the only way for offshore buyers of US real estate
Couldn’t make it to The Real Deal’s NYC event? Here’s what you missed

Couldn’t make it to The Real Deal’s NYC event? Here’s what you missed

Couldn’t make it to The Real Deal’s NYC event? Here’s what you missed
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...