As soon as I saw the story about a Chinese political/real estate dynasty looking to cut a deal with its U.S. counterpart, I went looking for the local angle. I figured an arrangement this “creative” just had to have some sort of Chicago connection.
If you missed it, Anbang Insurance Group—a major Chinese real estate company—is negotiating to buy the Kushner Companies’ stake in a Fifth Avenue high-rise, according to an article in Wednesday’s New York Times.
Anbang is run by Wu Xiaohui, who’s married to the granddaughter of Deng Xiaoping, the former chairman of the Chinese Communist Party and leader of the People’s Republic of China.
Kushner is the family real estate firm of Jared Kushner, who’s married to President Donald Trump’s daughter, Ivanka.
And you thought Chicago was rife with nepotism.
According to the Times, it’s a potentially fortuitous deal for the Kushner company, which “struggled to make its mortgage payments amid the recession” after purchasing the building in 2007.
So if a sale can be consummated, Anbang would effectively get President Trump’s son-in-law out of a not-so-great deal.
It could also, of course, have the appearance of a bribe to one of the president’s closest advisers at a time when Trump’s foreign business dealings are already under close scrutiny—he’s already been sued once, by a group of legal scholars arguing that payments his companies receive from foreign governments put him in violation of the Constitution’s emoluments clause.
It’s also on the eve of President Trump’s first meeting with the Chinese government, scheduled to take place next month at Mar-a-Lago.
My favorite part of the real estate story comes when an unnamed White House press officer tells the Times that “these private-sector negotiations will not affect the Trump administration’s policies or approach with China in any way.”
OK, if you say so.
Anbang isn’t new to the American real estate market. In 2016, it purchased Strategic Hotels and Resorts—which runs pricey hotels throughout the country—from the Blackstone Group for about $6.5 billion.
And here’s where the Chicago connection kicks in: Strategic’s headquartered at 200 W. Madison—right here in Chicago. Among its holdings is the Fairmount Hotel at 200 N. Columbus.
So the first thing I wanted to know is whether any of Strategic’s flashy downtown properties have received a TIF handout.
I’m happy to report that so far Strategic has refrained from feeding at the TIF trough.
On the other hand, the Fairmount has won a few property tax breaks over the years, thanks to the work of its tax appeal lawyer, who hails from the firm of Madigan & Getzendanner.
Yes, that’s Madigan as in Michael—speaker of the Illinois house, chairman of the state Democratic Party, father of Illinois attorney general Lisa Madigan, and chief adversary to Governor Bruce Rauner.
The Fairmount’s tax appeal might just as easily have been handled by Alderman Ed Burke’s law firm, which handled the appeal on Trump Tower. Apparently, Burke’s doing what he can to make sure your property taxes go up to compensate for Trump’s going down.
Hey, if the grandson-in-law of one of the world’s foremost communists can make peace with the son-in-law of an unabashed capitalist, then why can’t a Chicago Democratic ward boss help a Republican?
For the record, Madigan’s firm handled the Fairmount’s tax appeals before Anbang purchased the hotel. But Anbang was smart enough to keep them on the job—Madigan’s firms still handles Anbang’s property taxes in Chicago.
You’ve got to give Anbang’s Mr. Wu credit. He married into a political dynasty in China, may cut a real estate deal with another dynasty in New York City, and is represented by a third dynasty here in Chicago.
Kleptocracy and nepotism know no national boundaries.