Real Estate News: Shell Companies Purchasing Elite Real Estate on Behalf of Hidden Buyers

Foreign wealth has been flowing into elite New York Real Estate.
These buyers are not ordinary in the fact that they present
themselves rather they keep their identity hidden shielding their
names with a shell company when making a purchase.

The Time Warner Center for example in New York City has been
increasingly opaque over the past decade. 80% of the units were
said to have been bought by shell companies in 2014 growing
significantly since 2003 when only one-third of the units were
purchased by a shell company.

Many of these foreign buyers have been the subject of government
inquiries around the world including Russia, Colombia, Malaysia,
China, Kazakhstan and Mexico. Other mysterious owners represent
American wealth many of which being chief executives, celebrities,
doctors, lawyers, technology entrepreneurs, and Wall Street
traders.

According to data from First American Data Tree analyzed by The
Times, in recent years across the United States, nearly half the
residential purchases of over $5 million were made by shell
companies rather than named people.

Shell company ownership is not easily coded. In order to try and
unravel who the true owners were in the Time Warner Center, the
Times searched businesses and court records from more than 20
countries, interviewed dozens of people, and examined hundreds of
property records trying to connect the dots. This process took over
a year when successful yet some owners behind these shell companies
were nearly impossible to establish with certainty.

In most cases shell companies can be registered in the names of
accountants, lawyers, and relatives often with the purchase being
made by not only an individual but on behalf of groups of investors
or numerous family members. On many deeds, the line for the buyers
signature is left blank, is illegible or is signed by a lawyer or
other representative.

Quarter back of the New England Patriots, Tom Brady, is behind
the trust Courage Under Fire who bought a condo on the 74th floor
of the Time Warner Center. Some of the owners have been identified
as billionaires on Forbes magazines annual list of worlds richest
people, 17 exactly, the worlds leading art collectors, five
exactly, and former chief executives of major companies, eight
exactly.

What is it like to live in New York Citys elite real estate such
as the Time Warner Center? It has been reported that these
buildings are very secretive and close guarded. With multiple
entrances to the building, there are no door buzzers or mail slots
with residents names. You are unlikely to bump into neighbors
wandering the halls because only about a third of the owners live
there at any one time, according to people familiar with their
comings and goings. The buildings annual holiday party is said to
be a lonely affair.

Names of each unit owner does not need to be listed in order to
access the building. The building has a book listing names of those
associated with units but they follow protocols that facilitate
anonymity. Owners could walk alongside someone whose name is in the
book or enter through the shops or the hotel if they are cleared to
visit. A former manager stated that owners could be easily obscured
from their view.

There has been heavy speculation on shell companies buying into
real estate here in the United States not knowing who the actual
buyer is. But as Mayor Michael R. Bloomberg stated, If we could get
every billionaire around the world to move here, it would be a
godsend.

Source: Towers of Secrecy