Here's a shocker: One57, the city's billion dollar building and home to its priciest condo, may have been financed with scandal-tinged money. The Post takes a deep dive into the activities of some foreign investors connected to the financing of One57 whose shady goings-on may be downright illegal. Things get complicated, so bear with us.
One57 rose in 2010, during a little thing called the recession. To finance the tower at that time, Extell CEO Gary Barnett tapped two foreign connections: Tasameem Real Estate Co., a private investor based out of Abu Dhabi, and Aabar Investments. In September 2010, an LLC associated with Aabar gave Extell a $140.675 million mortgage.
Aabar's parent company, International Petroleum Investment Co. (IPIC), is "one of the biggest backers" of state-owned Malaysian investment fund 1Malyasia Development Berhad (1MDB) "that is at the center of a growing corruption scandal" according to the Post. Uh oh.
That scandal revolves around misappropriated funds transferred between the companies that just may have ended up in bank accounts tied to Malaysian Prime Minister Najib Razak.
1MDB has $6.5 billion in bonds guaranteed by IPIC. 1MDB issued two payments to IPIC: a $1.4 billion cash payment in 2012, followed by a nearly $1 billion payment. According to IPIC, neither of those payments were ever received.
Now, 1MDB is under investigation for siphoning funds into the personal bank accounts of Malaysian Prime Minister Najib Razak after more than $1 billion of their funds allegedly wound up in his accounts. While Najib denies any involvement, the US Department of Justice is looking into 1MDB and assets held by Najib, including luxury real estate in New York City. The Post speculates that the probe may also include any involvement 1MDB may have had in financing One57.
A senior official in Malaysia's Public Accounts Committee told the International Business Times that they're "close to the holy grail" regarding their investigation into the funds, and will declassify reports regarding the 1MDB money trail as soon as the investigation is complete. The scandal has lead to calls for the prime minister to resign.
- ONE57 tower linked to global money-laundering probe [NYP]
- Malaysian 1MDB scandal: Authorities getting closer to 'complete truth' behind Najib Razak finances [IBT]
- One57 Is Officially New York City's Most Expensive Condo [Curbed]
- One57's Tax Breaks Lead To a Paltry Number of Affordable Units [Curbed]