Here’s how — and why — Russian billionaires started investing in Manhattan real estate
So just why did all those Russian oligarchs end up investing in Manhattan real estate, anyway?
That question is tackled in a big way by Adam Piore, the author of The Real Deal’s soon-to-be-published “The New Kings of New York, Renegades, Moguls, Gamblers and the Remaking of the World’s Most Famous Skyline” in a Newsweek article that breaks down the who, what, where, when and whys of how skyline-altering developments that resulted in the likes of Billionaire’s Row came to be.
As the Russian invasion of Ukraine rages on and President Biden has targeted the billionaire’s “yachts, their luxury apartments, their private jets” for seizure, Piore looks at the role the billionaires played in sending high-end real estate prices to the stratosphere beginning in the late 2000s and the early 2010s.
Such properties are often worth tens of millions of dollars, the article states, and are often called the “world’s most expensive safe-deposit boxes” because of their ability to retain their value thanks to the stability of the dollar and the U.S. political system. That makes them attractive to foreign investors residing in unstable countries, especially since the origin of the money used to buy the properties can be kept secret by funneling it through a maze of trusts and LLCs. In some states, the report points out, “it’s often easier to obscure one’s identity by setting up an anonymous shell company than to get a driver’s license.”
That is especially the case in Manhattan, where developers have catered to the clientele by building supertall towers just south of Central Park filled with condos that can fetch nearly $200 million each“designed and marketed to the world’s .01 percent, a tiny group in which Russian oligarchs are disproportionately represented,” the article states.
Piore goes on to pinpoint the transaction changed the landscape of New York City’s real estate market, before breaking down the overall effect it has had along with what the government needs to do to fulfill President Biden’s agenda to go after the assets of “the Russian oligarchs and corrupt leaders who built billions of dollars off this violent regime.”
[Newsweek] — Vince DiMiceli