How Jared Kushner’s Real Estate Company Filed False Documents to Boost Its Profit
Kushner Companies, owned by President Trump’s son-in-law and senior adviser Jared Kushner, routinely falsified documents for several development projects in the Queens borough of New York City, according to a new report from the Associated Press.
Kushner and his brother, Joshua, own real estate properties together through Kushner Cos. and other companies under Westminster Management. This is the latest in a string of reported issues and grievances from tenants.
Kushner’s real estate company filed false paperwork with New York City that allowed it to profit by pushing residents out of rent-controlled apartments and bringing in higher-paying tenants.
Here’s what you need to know about Kushner’s real estate record.
Kushner Cos. Falsified Paperwork
Kushner Cos. filed at least 80 documents for 34 properties across New York City, including three buildings in a gentrifying neighborhood in Queens that the company bought in 2015. The paperwork, filed between 2013 and 2016, claimed that none of the units were rent-regulated, however more than 300 of the units were rent-regulated, according to tax documents.
Residents in the Queens properties claim that loud construction continued throughout the night and complained about leaks, rats, and other issues that were not fixed by the real estate company.
“It’s bare-faced greed,” Aaron Carr, founder of Housing Rights Initiative, told the AP. The initiative, a tenants’ rights watchdog, compiled the work permit application documents and shared them with the AP.
“The fact that the company was falsifying all these applications with the government shows a sordid attempt to avert accountability and get a rapid return on its investment,” Carr said.
The number of rent-regulated units in the buildings fell from as many as 94 when Kushner Cos. took over to just 25 by 2016.
“It was noisy, there were complaints, I got mice,” mailman Rudolph Romano told the AP. “They cleaned the place out. I watched the whole building leave.”
Though lying about rent-controlled units is an offense punishable by up to $25,000 in fines, developers who provide falsified information about tenants are often only asked by the city to amend the forms, sometimes more than a year later.
Records show that Kushner Cos. did submit dozens of amended forms to the city for the properties in Queens.
Kushner, Cadre, and Conflicts of Interest
Kushner stepped down from the real estate company in January 2017 upon beginning his position as a White House senior adviser.
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.
The Wall Street Journal reported in May that Kushner did not include his stake in Cadre in his financial disclosures when he began his role in the U.S. government. Cadre, which Kushner co-founded, is a real estate startup and the primary beneficiary of the Kushner Cos. property flip in Queens.
For Cadre, the project with Kushner Cos. was the first deal it handled from start to finish. The startup’s role in working on the three buildings in Queens, which sold in 2017 for nearly 50% more than Kushner Cos. paid for them, was touted as a proof-of-concept for its business model.
Kushner did not divest from Cadre when he began his White House role, and the startup has since raised $65 million in a series C funding round and received $250 million in client money from Goldman Sachs in January for real estate deals.
He also faces a lawsuit, along with his wife Ivanka Trump, over omissions in their financial disclosures.
His financial filings have changed several times— initially they “inadvertently omitted” more than 70 assets and 100 foreign contacts. And though his lawyers insist he does not use his government role to affect private business matters, Kushner has so far been denied top-level clearance in part because of concerns about his financial entanglements, according to reporting from the Washington Post.
Kushner as a (bad) landlord
This is not the first time Kushner’s behavior as a landlord have been questioned.
Kushner Cos. is also being sued by tenants in Baltimore who complained of mold and unfixed damage in their apartments along with steep late fees and harassment over debts many had already paid, according to reporting by ProPublica, the New York Times, and the Baltimore Sun.
Tenants filed a class action lawsuit against the company in September 2017. The Maryland attorney general’s office is looking into the management practices at Kushner Cos. properties.
In addition, Kushner Cos. is being sued by residents from a Brooklyn Heights property who make similar claims of rent increases and the use of construction as a tool to push old tenants out of the building.
“It’s not an isolated incident, it’s part of a systematic business model,” Carr, the housing rights activist, said in November. “There’s clearly a systematic problem with Kushner Companies’ misconduct.”