Owing Chinese investors $250 million, the real estate company owned by the family of President Trump’s son-in-law and key advisor, Jared Kushner, is finding it difficult to find a major bank willing to loan the money amid a number of controversies brewing around its links to the administration and allegations of a visa program to lure investors.
According to a Bloomberg report, Kushner Cos. has been testing the waters in search of a loan, using its 50-story Trump Bay Street in Jersey City as collateral. According to the report, the company would keep $50 million and use the rest to repay the investors and pay off a mortgage on the building.
The building is now valued at $340 million to $360 million, with more than half the apartments rented, according to a deal summary circulated to prospective lenders in recent weeks.
The company funded a chunk of the $194-million development through the EB-5 visa program. This program offers wealthy foreign investors green cards in return for an investment in U.S. projects. Under the program, a foreigner must put up at least $500,000 in a project that helps an area with high unemployment or in need of development in exchange for a permanent resident visa.
This is a program that has some under scrutiny for several years as lawmakers have sought stricter oversight to guard against fraud and provide better access to economically strapped regions. Because of the controversy and the property’s connection to the Kushners and the visa program, many large banks are wary.
On projects like Trump Bay Street, longer-term financing — with lower rates — is typically not available until the building reaches at least 50 percent occupancy, which this one now has, according to Laurent Morali, the president of Kushner Companies, said in a recent statement.
“We have received overwhelming interest, at our ask, from the pool of lenders that has been tapped. This is a very successful rental building, which is in high demand in the lending community.”
The Kushner family’s use of the EB-5 visa program stirred controversy in May when Jared Kushner’s sister, Nicole Meyer, mentioned his name during a marketing trip in Beijing as part of an effort to raise another $150 million in visa funding for a separate Jersey City project. Kushner Companies said later that Kushner family members would no longer participate in such roadshows in China.
In preparation for his role as a White House adviser, Jared Kushner divested some of his stakes in the family business and other investments. He also resigned his position as chief executive of Kushner Companies, as well as the management positions he held in the hundreds of entities the company uses to own its projects.