The real estate firm owned by Jared Kushner’s family received approximately $800 million in federally-backed funding to purchase $1.1 billion Mid-Atlantic apartment portfolio in a deal that closed Thursday. Berkadia Commercial Mortgage, the commercial lending company owned by Warren Buffet, provided Kushner Companies with the 10-year $800 million debt package backed by government-owned Freddie Mac, according to a report from Bloomberg.
Kushner Companies’ acquisition of the portfolio, which consists of around 6,000 apartment rental units in the Maryland-D.C. area, marks the company’s largest asset purchase since it infamously acquired 666 Fifth Avenue in 2007 for a then-record price of $1.8 billion. The Kushner family business unloaded the troubled asset’s 99-year lease last year to Brookfield Asset Management.
The family owned company is currently operated by Charles Kushner, Jared Kushner’s sister Nicole Kushner Meyer, and Laurent Morali. Before divesting from the company to assume a position as one of President Donald Trump’s senior advisors, Jared Kushner was the company’s chief executive officer. Kushner is married to the president’s daughter, Ivanka Trump.
When Bloomberg first reported on the possible deal back in February, Peter Mirijanian, a spokesman for Jared Kushner’s attorney Abbe Lowell, reiterated that Kushner has no involvement with the Kushner Companies’ management or business decisions.
“As part of an ethics agreement he has and has followed, Mr. Kushner has had no role in the Kushner Companies or its activities since joining the government over two years ago,” Mirijanian wrote in a February email to Bloomberg, adding that, “He is walled off from any business or investment decisions and has no idea or knowledge of these activities.”
As the deal is backed by federal funds and increases the government’s down-side exposure relating to Kushner’s family business, the move that has sparked concerns from ethics experts, who have noted that the “ethics agreement” used by Mirijanian to justify Kushner’s disinterest in the business has not been publicly disclosed.
The former director of the U.S. Office of Government Ethics Walter Shaub, for one, took to Twitter Friday to express his displeasure with the government’s lack of transparency.
“What’s really infuriating is that Kushner’s lawyer defends him by referring to an ethics agreement the public has not seen. The ethics agreements of all Senate-confirmed appointees are online. Why are the ethics agreement of White House appointees secret?” Shaub said.
This is not the first time Kushner’s relationship with the Kushner Companies has drawn the ire of ethics watchdogs. In addition to his failing to disclose multiple financial ties in his initial government disclosures, Kushner’s sister, Nicole Kushner Meyer, invoked Kushner by name while seeking investment from international investors for the company’s Jersey City development in 2017.
[Image via SAUL LOEB/AFP/Getty Images]