SUNNY ISLES BEACH, Fla. — The first of three identical 45-story Trump-branded condo buildings opened in this oceanfront city at a seemingly terrible time, just as the recession was dawning and the real estate market was starting to crumble.
Many other projects in South Florida floundered in the lead-up to the national housing collapse of 2008. But the Trump buildings were among those that survived, in part because the developers were able to turn to another business source seemingly immune to the factors dragging down the U.S. market: wealthy Russians looking to move their money out of the volatile post-Soviet economy.
“They were trying to save their butts, but in fact, they were saving ours,” said Jose Lima, who was a top salesman for the company that developed the Trump towers and marketed the units. He estimates that one-third of the 500 units he sold were bought by Russian speakers.
Today, there are so many Russians living in this city, a 1.8-square-mile collection of high-rise condos and upscale strip malls with caviar shops and Russian delis about 25 minutes north of Miami Beach, that locals call it “Little Moscow.” And the Trump brand has been dominant — with six condo skyscrapers in Sunny Isles carrying its logo.
Donald Trump’s positive statements about Russian President Vladimir Putin and his Russia-aligned policy positions have prompted critics to question the extent of the Republican presidential nominee’s financial connection to that country. While he has denied having investments in Russia, the experience in Sunny Isles and other Trump-branded communities shows how Russians have invested in him.
In addition to the towers of “Little Moscow,” Russian investors have been a valuable source of capital for Trump buildings in nearby Hollywood, Fla., and in a large complex in Panama City, Panama.
Trump does not own these buildings, but, like many Trump projects around the world, he licensed the use of his name and took a percentage of the profits from the initial sales of units. Real estate agents say there have been fewer Russian investors in Florida condos since U.S.-imposed sanctions on Russia took effect in 2014. They predict that the market will improve if Trump wins and reconsiders the sanctions.
Agents say that Trump’s image, synonymous with American-style luxury, has attracted the financial elite from Europe, South America and Asia, and, they say, his buildings have long held special appeal for Russian investors, many of whom have become super wealthy from the privatization of formerly state-owned monopolies in the former Soviet Union. Some say that Trump’s presidential campaign — in which he has complimented Putin as a “strong leader” — has only helped to enhance the marketability of his buildings.
“When Russians get here, the first thing they ask is, ‘Where is the Trump building?’ ” said Ilya Masarsky, a Russian-born real estate developer who has helped Russian executives investing in the United States. “They know the Trump brand; they know Trump. They want to live where he lives.”
As he sat in the marble-paneled common room of Sunny Isles’ Trump Tower I overlooking the Atlantic Ocean, Masarsky added another aspect of Trump’s appeal: “Russians compare him to Putin. They like a strong personality.”
Roman Bokeria, the Georgian-born chief executive of Miami Red Square Realty, said that Russian-speaking investors have been attracted to the Trump buildings because they see the brand as a safe place for their money.
“They don’t trust stocks or bonds,” Bokeria said. “They want real estate, something they can see and touch and feel. And for Russians, where is the best real estate? It’s Miami and South Florida. It’s Trump. That is the dream.”
Alan Garten, the Trump Organization’s chief counsel, acknowledged that developers of Trump projects have gone to Russia to sell and that the market there, like others around the world, have been fertile territory for the brand.
“There’s newfound wealth in Russia,” Garten said. “Just like there’s newfound wealth in China. Any developer is going to where you have a chance of selling your product.”
As for Sunny Isles, he said, “that’s the market. The Sunny Isles project, that area in South Florida generally, there are a lot of transplanted Russians.”
Garten, though, rejected the suggestion that lifting sanctions on Russia would affect the business. He said the idea of special ties with Russia because Russians have bought into Trump-branded buildings is a “total fabrication. It’s pulling needles out of haystacks and drawing these massive inferences.” Garten added that many Trump projects around the world have had no special appeal for Russians.
Trump’s lack of investment in Russia is not for lack of trying.
The businessman and his children have made several trips to Moscow to market the brand and discuss possible deals. The Trumps promoted their brand and hobnobbed with Russian power brokers in 2013, when the Trump-owned Miss Universe pageant was held in Moscow.
Donald Trump Jr. highlighted the company’s reliance on Russian investors during a real estate conference in 2008, about the time the Sunny Isles condos were being sold. He said that Russians “make up a pretty disproportionate cross-section of a lot of our assets” and that, “We see a lot of money pouring in from Russia.”
While in Riga, Latvia, in 2012, the younger Trump told interviewers that he saw “a real boom in wealth in some of these emerging markets” and noted that “there is an appreciation for brands and for brand names and for high-end luxury living and for hotels, and, obviously, we have something very relevant for that sector.”
Victor Masaltsev, an Internet entrepreneur in Moscow, was one of as many as 60 Russians or Russian-born Americans who developers said bought into the 630-unit Trump Ocean Club International Hotel and Tower in Panama. The complex, overlooking the Caribbean, is the tallest building in Central America.
“I was interested because of Trump’s name and because I thought it would be a secure investment,” Masaltsev said in a phone interview, translated by his Canadian-educated son.
Masaltsev learned of plans for the 70-story, sail-shaped residential and retail complex like many other Russians who came to trust the Trump brand with their money: through Russian-born business acquaintances or friends living in South Florida. Before deciding to invest, he attended a sales meeting in Moscow with other interested Russians.
The meeting was led by Roger Khafif, who told potential buyers that Trump was a partner on the project, as did the elaborate promotional material he distributed.
“Russians like brands,” Khafif said in an interview, “and Trump was famous in Russia” during the early 2000s real estate boom. “These were good days for Trump. He was the only man in town for real estate.”
The elder Trump hosted a sales event attended by potential Russian investors and guests at his Mar-a-Lago Club in Palm Beach in January 2008. About a dozen Russians came, Khafif recalled, as well as real estate brokers and salespeople, mainly from Miami. It was a splashy event attended by, among others, Trump’s friend Regis Philbin. Trump chatted with the potential buyers and posed for photos as he talked up the Trump Ocean Club project in Panama.
Valentina Aved, an Estonian-born real estate broker in Palm Beach, said Trump’s branded properties have worked hard to market to Russians. The towers in Sunny Isles and Hollywood have, like other local venues, hosted meetings of the Russian American Chamber of South Florida. Aved recalled that at one particular meeting, over catered food from a Russian restaurant, the building developer gave a speech about how welcoming the property was for Russians.
Aved said she also participated in a day-long sales event for a Trump-branded property in the Dominican Republic so that she could market specific properties there to Russians.
“Everything Trump does for the lifestyle, it matches the Russian lifestyle,” said Aved, a staunch supporter of Trump’s candidacy.
As in Sunny Isles, the importance of Russian investors to Trump’s success was evident a few miles up the road in Hollywood. With construction ending in 2009, amid the recession, the project was on the brink of failure until a new developer stepped in.
Trump attended a flashy relaunch party in February 2011. Eight months later, the Trump Hollywood posted a notice on its Facebook page bragging that “since our relaunch in February, Trump Hollywood has seen Russian buyers spend $11.2 million on luxury residences.”
Seven months after that, the building’s units were sold out. Trump was so pleased that he recorded a video to praise the building’s development team for turning things around.
Trump pocketed $10 million to $20 million from the project, according to one of the developers, Daniel Lebensohn.
Both of the Trump Hollywood penthouses appear to have been purchased by Russians. Property records show that one unit was purchased for $6.75 million in 2010 by a company associated with Oleg Miserva, a Russian coal company president who met with Putin in 2010, according to a news release on the website of a Russian government archive.
The other oceanfront penthouse unit was purchased for about $6 million by Elena Gorlova, who shared a Florida address with a businessman named Eli Aliyevich Dzhabrailov. According to a listing on the real estate website Zillow, the unit features seven bedrooms and 8½ bathrooms, a private terrace, and floor-to-ceiling windows with panoramic ocean views. It was purchased on the same day that Dzhabrailov bought a second unit in the building for $1.48 million. They could not be reached for comment.
One of those penthouse buyers flew high-end interior designer Stephen Gurowitz and a Miami real estate agent, Monica Gorban, to Moscow in 2011 to discuss plans to decorate the unit and other properties.
Neither Gurowitz nor Gorban would identify the client, and they said they did not know what he did for a living.
They described how they were flown to Moscow, put up at a Ritz-Carlton hotel and driven in an armored Mercedes-Benz to the investor’s compound in the Moscow suburbs.
“You never find out what kind of business they’re in,” Gorban said. “All I knew was that the checks came, they closed, and life was good.”
Gurowitz and Gorban said that their client had purchased the penthouse and a second unit in the building.
“To really sum it up, in all fairness, why do the Russians come here? For the weather, for the lifestyle and because it’s a good place to bury their money,” Gorban said.
Alice Crites contributed to this report.