Hundreds of California landlords down with PPP

Trump administration data reveals range of recipients including resi landlords

TRD LOS ANGELES /
Jul.July 07, 2020 10:13 PM
Igor Olenicoff, President of Olen Properties (Credit: Tim Rue/Corbis via Getty Images)
Igor Olenicoff, President of Olen Properties (Credit: Tim Rue/Corbis via Getty Images)

Two California residential landlords got between $5 million and $10 million in loans under the Paycheck Protection Program, the maximum loan range allowed in the federal payroll relief measure for small businesses.

One was Tenderloin Neighborhood Development Corporation, a San Francisco nonprofit that builds housing with support services for homeless residents.

The other?

Newport Beach-based Olen Properties Corp. run by Igor Olenicoff, a man who possesses a net worth of $3.9 billion, according to Forbes, and has been convicted of tax evasion and held liable for art forgery.

The contrast between two of California’s biggest PPP winners is one result of Donald Trump’s administration doling out $657 billion in the last two months to help businesses hit by the coronavirus pandemic make payroll.

Businesses can apply to have the PPP loans forgiven, if they meet criteria including using at least 75 percent of the loan toward paying workers.

After weeks of declining to make PPP information public, the Small Business Administration disclosed recipients Monday but gave loan ranges instead of dollar amounts.

Even the incomplete data unearthed a treasure trove including that Shenzhen New World Group received two loans between $2 million and $5 million to retain 104 employees. The FBI says the China-headquartered real estate developer funneled roughly $700,000 in bribes to Jose Huizar, an L.A. City Council member who was arrested last month on racketeering charges.

Another Shenzhen, China-headquartered developer ensnared in the Huizar probe, Shenzhen Hazens Real Estate, netted a loan between $2 million and $5 million.

Other highlights, as such, of PPP enrollees in the Golden State:

* There were 221 California-headquartered businesses classified as “lessors of residential buildings and dwellings” who received a loan of greater than $150,000 despite initial instructions explicitly barring landlords and developers from the program.

Landlord lawyers figured out loopholes around the prohibition, and the recipient names released Monday make little effort to shroud their identity as property developers and owners.

Of the 221 loans recorded above $150,000, 180 were for less than $1 million.

Daniel Yukelson, executive director of the Apartment Association of Greater Los Angeles, stressed that the vast majority of residential landlords did not get a PPP loan, or received minimal loans at a time when rental revenue has dipped, and there is “a great deal of financial stress on the system.”

* The biggest for-profit residential landlord getting a loan was Olen, which owns eight million square feet of office space and 15,000 residential units in California, Florida, and four other states. The loan is supposed to allow the company to retain 459 employees.

Olenicoff, the company’s founder and CEO, has been a colorful and at times controversial figure.

The Russian immigrant pleaded guilty in 2007 to tax evasion after withholding from the Internal Revenue Service that he owned $200 million in offshore companies. The real estate executive didn’t go to prison, and, in fact, his criminal defense attorneys popularized the “Olenicoff defense” where an offshore tax cheater avoids jail time partly by immediately paying their back taxes.

Olenicoff has also waged a years-long legal battle with sculptor Don Wakefield, over allegedly forging the artist’s work. A civil court jury awarded Wakefield $450,000 in 2014, though on appeal Olenicoff was allowed to not make the payment if he destroyed the forgeries.

* Among brokerages, The Agency received the biggest loan, between $2 million and 5 million, so as to keep on 104 employees.

Beverly Hills’ Rodeo Realty netted between $1 million and $2 million so the brokerage could hold onto 116 employees. Hilton & Hyland, also of Beverly Hills and often involved in L.A.’s most expensive home sales, got a $350,000 to $1 million loan to keep on 19 workers.

And San Fernando Valley residential broker mainstay Pinnacle Real Estate got somewhere between $350,000 and $1 million to retain 67 workers.

Meanwhile, Anaheim’s Milan Capital Management, the recent victim of a $1.8 million embezzlement scheme by a former accountant, received a $350,000-to-$1 million loan.

Rising Realty Partners also received a loan between $350,000 and $1 million loan to keep 40 employees, after venting that Wells Fargo wouldn’t orchestrate the loan. The downtown L.A. developer went, instead, to First Choice Bank.


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