Bayrock Group

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Bayrock Group
TypePrivate
IndustryReal estate development
Founded2001 (2001)
FounderTevfik Arif
Headquarters
New York City
,
USA
Key people
Tevfik Arif (Chairman)

Bayrock Group is a private real estate investment and development firm specializing in luxury residential, commercial and mixed use projects. Through its affiliated entities, Bayrock has made investments in transactions comprising real estate assets valued in excess of $2.5 billion. Bayrock’s flexible investment strategy allows it to pursue investments in a variety of sectors and markets.

Corporate structure[]

The Bayrock Group was founded in 2001 by Tevfik Arif, a former Soviet official from Kazakhstan. According to Forbes, Bayrock is "a series of commonly controlled, but not wholly owned, limited liability companies."[1] Bayrock Group is arranged in tiers, with Bayrock Group LLC having a majority or plurality interest in around 12 subsidiary holding companies. The holding companies in turn have majority interests in companies on lower tiers. The lower tier subsidiaries correspond to individual real estate projects, with Bayrock Spring Street corresponding to Trump SoHo, Bayrock Camelback to the Phoenix hotel project, and Bayrock Merrimac to the Trump Fort Lauderdale hotel.[2] Other Bayrock subsidiaries include Bayrock Whitestone and Bayrock Ocean Club.[citation needed]

Bayrock Group has had strategic partnerships with international entities outside of the United States including Icelandic investment company FL Group.[3]

Projects and properties[]

Loehmann's Seaport Plaza[]

Bayrock began developing property in Brooklyn, initially redeveloping Loehmann's Seaport Plaza, a three-story, 280,000-square-foot (26,000 m2) waterfront shopping center on Emmons Avenue in Sheepshead Bay, Brooklyn.[4] The property's tenants include Loehmann's and Nine West Shoes.[citation needed]

Trump International Hotel & Residence[]

In 2003, Bayrock purchased a site out of bankruptcy in the Camelback Corridor of Phoenix, Arizona. Bayrock announced plans for the Trump International Hotel & Residence, a $200 million, 190-foot Trump International Hotel. Plans for the project included 97 private residential units starting at $950,000 and 188 hotel/condo rooms. While the site was approved by the Phoenix City Council and the Planning Commission in 2005, the project was curbed by public opposition[5] and never finished.[6]

Moscow high-rise[]

See also: Business projects of Donald Trump in Russia

In 2005, Donald Trump entered into an agreement with the Bayrock Group for a one-year deal to develop a project in Moscow. Bayrock located Russian investors and a potential site for the high-rise, a closed pencil factory named for Sacco and Vanzetti.[7] "We looked at some very, very large properties in Russia," on the scale of "...a large Vegas high-rise."[8] Bayrock proposed a potential deal in Moscow between Trump International Hotel and Russian investors in 2007,[9] but the deal never came to fruition.[7]

Trump SoHo[]

Trump SoHo, 2014

The Trump SoHo is a $450 million, 46-story, 39-unit, condo-hotel hybrid located at 246 Spring Street in SoHo, New York City. The hotel was a joint venture between Bayrock, The Trump Organization, and the Sapir Organization, a company owned by Georgian real estate developer Tamir Sapir. Trump provided a licensing deal for the hotel in exchange for an 18% equity stake in the project.[10][3]

In 2007, Bayrock traded future profits from Trump SoHo and other projects in exchange for $50 million in financing from Icelandic company FL Group.[11]

Trump International Hotel and Tower (Fort Lauderdale)[]

Bayrock entered into a joint venture with Trump to develop the Trump International Hotel and Tower in Fort Lauderdale, Florida.[10]

The working relationship with Donald Trump ended in 2008, following the housing market collapse.

Controversies[]

See also: Legal affairs of Donald Trump

In 2002, a Novaya Gazeta article explained that Tevfik Arif is very close to Salim Abduvaliev, both Arif and Abduvaliev are leaders of Uzbek mafia.[12][13][a] They are also close to Michael Cherney, Anatoly Bykov and Boris Petrunin.[23][24]

Trump International Hotel & Residence investor Ernest Mennes filed a lawsuit in U.S. District Court in Arizona in 2007. The suit alleged that Bayrock had skimmed money its planned Trump development in Phoenix.[25] It further alleged that Felix Sater, an employee of Bayrock, had called Mennes in 2006, threatening him personally.[7] The case was settled by Bayrock[25] and Mennes was barred from discussing the matter.[7]

In the federal case Kriss et al. vs. Bayrock Group LLC et al., two former Bayrock employees, former director of finance Jody Kriss and Michael Chudi Ejekam, filed a suit in the U.S. District Court in New York in 2010.[26] The suit alleged that Sater's role in the company was hidden and that the company was "substantially and covertly mob-owned and operated."[25][27] The case was settled out of court at the insistence of plaintiffs, with no admission of guilt from either party.[28]

In 2011, the Rockwell Group, an interior design firm, sued Bayrock and Sapir Organization for over $1.5 million in damages after Bayrock failed to pay for interior design work at Trump SoHo. Bayrock countersued two days later, filing a complaint with the New York Supreme Court, the case was eventually dropped.[citation needed]

Attorneys Frederick Oberlander and Richard Lerner brought a qui tam case against Bayrock in 2015.[29] The suit alleged that Arif, Satter, and others had been in control of Bayrock for nearly a decade[1] and had "engaged in a series of tax frauds and then took steps to hide the fraud";[1] this case was thrown out by a New York Judge.[28][30][31]

Felix Sater, an American entrepreneurial financier and real estate developer, was employed as managing director of Bayrock Group from 2003 to 2008.[32] Unfortunately for Bayrock, during a 2008 investigation into Sater, a worrying and chequered past emerged that led to his suspension and dismissal. Amongst other things in 1991 he got into an argument with a commodities broker at the El Rio Grande restaurant and bar in Midtown Manhattan. Sater stabbed the broker’s cheek and neck with a cocktail glass, breaking his jaw and severing nerves. Sater was convicted of first degree assault and spent 15 months in minimum security Edgecombe Correctional Facility in New York City, before being paroled.[32][33] Additionally, in 1998, Sater pleaded guilty to his involvement in a $40 million stock fraud scheme orchestrated by the Russian-Jewish Mafia, and became an informant for the FBI, assisting with organized crime investigations.[32][34]

Notes[]

  1. ^ Filipp Turover Chudinov, who was a senior intelligence officer with the foreign-intelligence directorate of the KGB, stated that Viktor Chernomyrdin secretly decreed in the early 1990s that Russia would become an international hub through which narcotics are trafficked including cocaine and heroin from South America and heroin from Central Asia and Southeast Asia.[14][15] Yuri Skuratov supported Turover's statements and began numerous investigations into corruption with high ranking Russian government officials.[16] Alexander Litvinenko stated that Abduvaliev and Gafur Rakhimov traffic Central Asian heroin for the Russian government.[17][18][19][20] Robert Eringer confirmed this.[21] According to Jon Purnell, Abduvaliev is the Uzbek "mafia boss" and "the boss of the criminal world" of Uzbekistan.[22]

References[]

  1. ^ Jump up to: a b c Erb, Kelly Phillips (28 July 2016). "Trump & Kids Named, But Not Charged, In $250 Million Tax Evasion Case". Forbes.
  2. ^ Kramer, Reuben (18 September 2009). "Former Exec Says Developer Pulled a Fast One". Courthouse News Service.
  3. ^ Jump up to: a b Henry, James S. (19 December 2016). "The Curious World of Donald Trump's Private Russian Connections". The American Interest.
  4. ^ Kates, Brian; Schapiro, Rich (1 October 2010). "Trump pal busted for allegedly running hooker ring on yacht". NY Daily News.
  5. ^ Ruelas, Richard (18 March 2016). "How Phoenix residents dumped Donald Trump's hotel plans". The Arizona Republic.
  6. ^ Buchholz, Jan (15 August 2010). "Camelback parcel once eyed by Donald Trump to be sold". Phoenix Business Journal.
  7. ^ Jump up to: a b c d Helderman, Rosalind S.; Hamburger, Tom (17 May 2016). "Former Mafia-linked figure describes association with Trump". Washington Post.
  8. ^ Twohey, Megan; Eder, Steve (16 January 2017). "For Trump, Three Decades of Chasing Deals in Russia". The New York Times. Retrieved 8 February 2017.
  9. ^ Belton, Catherine; Stott, Michael (13 December 2016). "Trump's Russian connections". Financial Times. London. Retrieved 8 February 2017.
  10. ^ Jump up to: a b Nance, Malcolm (2016). The Plot to Hack America: How Putin's Cyberspies and WikiLeaks Tried to Steal the 2016 Election. Skyhorse Publishing, Inc. ISBN 978-1-5107-2333-7.
  11. ^ Silverman, Gary (14 August 2016). "US election: Trump's Russian riddle". Financial Times.
  12. ^ Анатолий БЫКОВ: ПУТЕШЕСТВИЕ ИЗ НАЗАРОВА В ЛЕФОРТОВО И ОБРАТНО
  13. ^ Крах империи Анатолия Быкова
  14. ^ Лурье, Олег (Lurie, Oleg) (27 December 1999). "Список Туровера" [Turover List]. Novaya Gazeta (in Russian). Archived from the original on 29 December 1999. Retrieved 22 May 2021.
  15. ^ Lurye, Oleg (27 December 1999). "Turover List". Novaya Gazeta. Retrieved 22 May 2021 – via Russialist.org.
  16. ^ Yablokova, Oksana (29 December 1999). "Skuratov: 'Turover List' Is Real". The Moscow Times. Archived from the original on 23 February 2021. Retrieved 22 May 2021.
  17. ^ Кириленко, Анастасия (Kirilenko, Anastasia) (21 January 2016). "Путин и мафия. За что убили Александра Литвиненко" [Putin and mafia. Why Alexander Litvinenko was killed]. The Insider (in Russian). Archived from the original on 23 January 2016. Retrieved 22 May 2021.
  18. ^ Litvinenko, Alexander (25 November 2006). Why I believe Putin wanted me dead... Archived from the original on 19 December 2020.
  19. ^ Litvinenko, Alexander Схема связей преступного мира, нарисованная Литвиненко (Litvinenko's diagram of the connections of the underworld) Archived from the original on 23 January 2016.
  20. ^ "Литвиненко, Александр. "ЛПГ-Лубянская преступная группировка", Глава 4. Узбекский след, GRANI, New York, 2002". Archived from the original on 2011-09-21. Retrieved 2011-09-21.
  21. ^ Кириленко, Анастасия (Kirilenko, Anastasia) (16 December 2013). "Путин на "личной службе" у князя Альбера" [Putin on "personal service" with Prince Albert]. Радио Свобода (Radio Svoboda). Archived from the original on 9 October 2016. Retrieved 22 May 2021.
  22. ^ "Wikileaks: Uzbek mafia boss Salim sells official positions and treats Uzbek ministers". Archived from the original on 2016-03-04. Retrieved 2016-03-04.
  23. ^ Анатолий БЫКОВ: ПУТЕШЕСТВИЕ ИЗ НАЗАРОВА В ЛЕФОРТОВО И ОБРАТНО
  24. ^ Крах империи Анатолия Быкова
  25. ^ Jump up to: a b c Horwitz, Jeff (4 December 2015). "Q&A on Trump real estate adviser accused of a $40M stock fraud scheme and ties to the mob". AP.
  26. ^ "Did CIA Help a Swindler Walk?". Courthouse News Service. 14 May 2013.
  27. ^ Putzier, Conrad (14 April 2016). "Bayrock Group named in Tate George fraud case", The Real Deal.
  28. ^ Jump up to: a b Dolmetsch, Chris; Voreacos, David (2018-02-22). "Trump-Linked Real Estate Firm Settles Suit by Ex-Employee". Bloomberg.
  29. ^ Bautista, Christian Brazil (11 October 2016). "Felix Sater says he's being shaken down with $250M suit over Trump projects". Real Estate Weekly.
  30. ^ "Qui Tam Case Against Sater of Bayrock, Thrown Out by New York Judge".
  31. ^ Bertr, Natasha (September 27, 2017). "New York court dismisses $250 million tax fraud case against Russia-born former Trump associate". Business Insider Nederland.
  32. ^ Jump up to: a b c Dreyfuss, Bob (September 8, 2017). "Who Is Felix Sater, and Why Is Donald Trump So Afraid of Him?" – via www.thenation.com.
  33. ^ Rice, Andrew (August 3, 2017). "Felix Sater: Donald Trump's Original Russia Connection". Intelligencer.
  34. ^ Haltiwanger, John. "Meet Felix Sater, the Russian-born, bar-fighting felon with ties to the mob at the center of Mueller's Russia investigation". Business Insider.
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