Kushner Companies in Hot Water for Falsifying New York City Permits
Mar 20 2018
Aaron Carr, founder of Housing Rights Initiative, a tenants' rights watchdog that compiled the work permit application documents toldThe Associated Press that Kushner Cos. routinely filed false paperwork with the city declaring it had zero rent-regulated tenants in dozens of buildings it owned across the city when, in fact, it had hundreds. "They cleaned the place out", Romano told AP.
Kushner Cos. apparently did the same thing in the East Village in 2013, claiming that a six-story walk-up had zero rent-regulated tenants when, in fact, there were seven of them. After the company displaced most of the residents, it sold the buildings two years later for $60 million, almost 50 percent more than their purchase price, according to AP. In each case, Kushner Cos. claimed that its properties had no rent-regulated apartments, but tax documents show that the company's properties had more than 300 such units in all.
For the first time, the Kushner Companies admitted Sunday to meeting with Qatar's finance minister in NY three months after President Donald Trump took office, but said no funds were exchanged or a deal struck.
The Kushner Cos. said in a news release Monday that "the investigation is trying to create an issue where none exists".
"If mistakes or typographical errors are identified, corrective action is taken immediately with no financial benefit to the company", Christine Taylor, a spokeswoman for Kushner Cos., said in an emailed statement.
The real estate investing platform is backed by Thrive Capital, the venture investing firm founded by Joshua Kushner, Jared's brother.
For its part, the New York Department of Buildings said its investigation into the matter is ongoing and that it has undertaken a series of steps to spot future false filings. On those permits, the developer indicated that its buildings did not have rent-regulated apartments, when that was not the case.
Submitting false documents to the city's Department of Buildings for construction permits is a misdemeanor, which can carry fines of up to $25,000.
Like many real estate companies, Kushner Cos. often seeks funds from investment companies to help finance deals.
Torres said the investigation would lead to the publication of a report, that he would work to pass legislation to bolster oversight of the permitting process and would make a criminal referral if there was evidence of criminal wrongdoing.
Kushner Cos. previously blamed the inaccurate paperwork on a third party that filed the documents.
Jared Kushner, who stepped down as CEO of the Kushner Cos. a year ago before taking on his advisory role at the White House, sold off part of his real estate holdings as required under government ethics rules. The company also likely made money by reducing the number of rent-regulated tenants and bringing in those who would pay more.
The 36-year-old agreed to divest himself from more than 80 assets when he assumed the role, but retained more than 200 other assets worth at least $116 million, according to his financial disclosures.