Russian oligarchs loved luxe Sardinia. Now they’re frozen out of paradise.

(Video: Riccardo Locci/For The Washington Post)
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ROMAZZINO, Italy — Even among the billionaires who flock to this vacation enclave, the Russian oligarchs stood out.

They bought up the choicest villas along the coast, building de facto empires shielded behind clipped hedges and surveillance cameras. They were known among real estate agents for always wanting armed guards. One mining and metals tycoon, Alisher Usmanov, would announce his presence every summer with the arrival of one of the world’s largest yachts, which he’d park in the turquoise bay, shuttling between the vessel and his villas, flying in guests on helicopters.

“It was like having an oligarch state right here in Sardinia,” said Mauro Pili, a journalist who was once this island’s governor.

That state has now been dismantled.

Over the past two months, European sanctions targeting wealthy elites with Kremlin connections have leveled a direct strike on this lavish northeastern stretch of Sardinia known as the Emerald Coast. At least eight villas spread out across 10 miles have been frozen by the Italian government, leaving the targeted oligarchs — three Russian billionaires — cut off from the secluded coves and crescent-moon beaches.

But the move to strip Russians of their European property and privileges leaves several dilemmas in its wake.

Hundreds of workers — sometimes receiving five- and six-figure tips — are out of a job. Sardinians are left to wrestle with whether they miscalculated in catering to Moscow’s super-rich; some developers even had websites in Russian. Then there is the biggest headache of all: figuring out how to manage the frozen properties — more than $250 million in real estate, all now in the hands of the Italian state, with no clear answer on how long they might sit empty.

“They’ll be like haunted mansions,” said Tamara Grilloti, a luxury real estate agent in Sardinia.

The villas are scarcely visible from behind their front gates. The views encompass rocky headlands, sea and sky. The Emerald Coast is less developed than Mykonos or Ibiza. And it springs to life only for a few weeks a year, when the ultrarich arrive in July and August, private planes touching down by the hundreds.

Visitors have included George Clooney, Bill Gates, hedge fund managers and supermodels. On at least two occasions, in 2003 and 2008, Russian President Vladimir Putin stayed as a guest at the palatial compound of then-Italian prime minister Silvio Berlusconi. Among Russians, those trips helped boost the popularity of Sardinia, which is 100 miles across the Tyrrhenian Sea from Rome — and nearly 2,000 miles from Moscow.

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According to the Italian government, the sanctioned Russians with frozen property here include Alexei Mordashov, a steel magnate said to be Russia’s richest man, and Dmitry Mazepin, who until March was the chief executive and controlling owner of fertilizer company Uralchem, and who held the Sardinian property in tandem with his son.

Among locals, though, the most well-known of the targeted oligarchs is Usmanov, who unlike the other billionaires spent months, not just weeks, in Sardinia each year, and who ingratiated himself to the year-round community that tends to live more inland.

Usmanov, 68, started coming to Sardinia soon after the collapse of the Soviet Union, and, as he assembled a constellation of properties, he developed a reputation for being generous with his riches.

He bought several ambulances for the municipality. He sponsored the local soccer team. He funded cultural activities. He also spent much of Italy’s coronavirus lockdown in Sardinia — providing an economic boost when tourism slowed.

In 2018, when the community named him an honorary citizen, Usmanov spoke at the local town hall about how Sardinia’s geography reminded him of the area of Uzbekistan where he grew up.

“[There is] a certain chemistry between my soul and this land,” Usmanov said.

Sardinians are now trying to reconcile what they saw with what Western governments are saying about his role in the war.

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The United States says Usmanov is one of the elites whose wealth — accumulated through metals, mining, IT and telecommunications — is allowing Putin to sustain his assault on Ukraine. The European Union says Usmanov has been called one of Putin’s “favorite oligarchs,” has fronted money for the Russian leader and has “solved his business problems.”

Usmanov controls a daily newspaper, the Kommersant, whose entire political desk resigned in 2019 as he curtailed editorial freedoms and instituted a pro-Kremlin line. A spokesman for Usmanov said the journalists were dismissed because of “disciplinary and ethical concerns,” and that Usmanov did not play a role in the decision.

Usmanov also used the villas in Sardinia for treating Russian elites. One former employee, speaking on the condition of anonymity because he’d signed a nondisclosure agreement, recalled Usmanov more than a decade ago introducing him to one of the guests aboard a yacht. “This man will be president one day,” the former employee remembers Usmanov saying. It was Dmitry Medvedev, who served by turns as Russia’s president and prime minister from 2008 until 2020.

The E.U., in its sanctions rationale, said Medvedev had “benefited from the personal use of luxurious residences” controlled by Usmanov. Usmanov’s spokesman called the account of an introduction on a yacht “pure fiction.”

Amid the sanctions, Usmanov has lost access to assets European governments say he controlled. France has impounded two helicopters, and German officials in Hamburg have frozen a $600 million yacht, outfitted with two helipads and an 80-foot swimming pool.

Many Sardinians still hope Usmanov might ultimately be able to come back to the island. They tend to see the war as Putin’s alone, and don’t view Usmanov, or other oligarchs without military and security roles, as being complicit in the invasion. The town of Arzachena, for instance, has not revoked Usmanov’s citizenship honors.

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“Many of these oligarchs are still perceived here as magnates, as benefactors,” said Mirko Idili, a union leader. He said he is trying to broker a deal between the Italian government and Usmanov to protect the workers, some of whom have lost their jobs, and others whose jobs have been suspended without pay.

But Pili, the former governor, said Sardinia now has a chance to wean itself from reliance on Russian wealth. He compared the opportunity to the decision facing European countries on whether to continue buying Russian oil and gas.

“We ended up relying fundamentally on one world,” he said. “And once you close the tap, there’s damage.”

(Video: Riccardo Locci/For The Washington Post)

Keeping up with the Usmanovs

Four Usmanov-linked villas are clustered on a tiny peninsula, where the properties slope down toward the beach, nestled among cactus paddles and flowers. They are among the most exclusive properties in Sardinia. And the job of attending to them now falls to the Italian government, which is required by law to maintain the value of any asset it freezes.

Real estate agents and owners say that even outside the context of sanctions, villas like these can be as vexing as they are alluring. They cost several hundred thousand dollars annually to operate — and that’s just the beginning. Workers, sometimes commuting as far as an hour away, are hard to come by, especially for employers who aren’t willing to pay as well as the Russians did. Across the Emerald Coast this month, many villas — weeks away from the summer surge — looked more like construction sites.

“When you arrive the first day of the summer, it’s always a disaster,” said Flavio Briatore, an Italian entrepreneur who has a home on the island and who owns a nearby restaurant and dance club called the Billionaire. “Some pump isn’t working, whatever. And then when everything is finally ready to go, it’s time to go back [home].”

“Sooner or later I want to sell mine,” he said.

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As an example of what it takes to manage an ultraluxury property, one typical morning this month, 20 workers were scattered across the grounds of a villa belonging to Ezio Simonelli, an Italian tax accountant. One man was retouching the bottom of a swimming pool — one of three on a property that has been rented in the past by George Clooney and the then-president of Kazakhstan. Six workers were pulling up rotted wood from around a hot tub. Yet more were attending to the various other needs of the property, which includes a vegetable garden, a tennis court, two golf holes, a wine cellar, and an industrial-sized kitchen that can cater parties of up to 350 guests.

“Look at this wood; it’s like dust,” one of the workers said, digging up some broken planks.

Italy doesn’t have to keep the frozen villas guest-ready, but by law it is supposed to keep them from falling apart. People familiar with the work, requesting anonymity to speak about a sensitive issue, say the government faces a monumental task.

Italy has on its hands not just the Emerald Coast villas, but another in Sardinia, 40 minutes by car, linked to Petr Aven, until recently the head of Russia’s largest commercial bank. There is also a frozen villa in Tuscany and several others near Lake Como. That’s in addition to two of the world’s most expensive yachts, which tend to have annual operating costs in the millions.

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And that is probably not the full list of assets in Italy controlled by Russians targeted by sanctions. Several real estate agents connect another Emerald Coast property to industrialist Oleg Deripaska, who is under sanction. No property belonging to Deripaska is on Italy’s list of frozen assets, and the Finance Ministry declined to comment on specific cases.

In theory, Italy can use the oligarchs’ frozen bank accounts to help pay for the upkeep of the frozen villas and yachts. But one person with knowledge of the Russian cases said the maintenance costs will exceed the money in the accounts.

Clara Portela, a specialist in international sanctions at the University of Valencia, said E.U. countries have scant experience in handling mega-assets; most of the people previously targeted by E.U. measures — such as members of Myanmar’s junta — didn’t have significant wealth stored away in Europe.

“These were individuals that didn’t have such a glamorous lifestyle,” Portela said.

On the street with the Usmanov-linked villas, there is no sign that Italy has yet begun its work, and the agency responsible for the frozen assets says it is still finalizing how to manage the properties.

“The Italian state has to make a decision,” said Grilloti, a real estate agent who previously rented properties to Russians. “If it were up to me, I’d put them up for rent, and give the money to Ukraine.”

Italy says it has the option to sell the frozen assets if they become too expensive to manage. But such a move would be likely to draw legal challenges.

Already, Usmanov has pledged to use “all legal means” to protect his reputation. And there have been successful challenges to European sanctions over the past decade-plus, including on due-process grounds.

In a statement, Usmanov’s spokesman said he would not comment on any possible legal steps. But he said Usmanov considers the sanctions to be “unfair and based on false and defamatory allegations.” The statement said that most of the properties in Europe that have been connected to him were in fact long ago “transferred into irrevocable family trusts.”

Sardinia represents life before the war

While the Russians own many of the Emerald Coast’s top properties — “like diamonds,” said the head of the land- and homeowners association — they represent only a minority of Sardinia’s jet-set class. In the summer, villas also fill up with Germans and Swiss and Italians, and many others from the Persian Gulf. There are even some Ukrainians — though they, too, are now finding themselves cut off, not because of sanctions but because of the war.

“It’s not that the Russians broke down my plans for vacation,” said Aleksandr Nastenko, 50, the owner of a geological company. “They destroyed my life.”

Most summers, Nastenko rents a villa in Sardinia — far smaller than the Russian ones. But earlier this month, he was instead standing in Kharkiv, holding his phone as he walked through the battered eastern Ukrainian city. He hadn’t shaved in several days. His wife and four children had fled early in the war to Germany. A missile strike had damaged his house and injured his dog. He was sleeping at friends’ homes some nights. He’d stopped running his business, volunteering instead for the war effort while raging about what Russia was doing to his city and country.

“What happened to these oligarchs — well, I believe they deserved it,” Nastenko said. “They robbed their country and [their wealth] is their payment for their silence. They were silent when all these things were happening. They let these things happen.”

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Sardinia, he said, is a place that symbolizes what his life used to be. It was a place he’d go when his family was still together — renting a home on the water with a covered terrace and a grill where he’d cook oysters. His family picked figs from the garden and went boating along the whitewashed cliffs.

“Our past life,” he said.

As he spoke, he paused every now and then, pointing out the sounds of shelling several miles away.

“Listen,” he kept saying.

He said that during the war, many of his priorities have changed, and material possessions seem less important than they had before. But returning to Sardinia, he said, was something he still badly wanted. After the war, he said, he’d buy a house there.

Just not the villa of an oligarch.

“No way,” he said. “They’re toxic.”

correction

A previous version of this story mistitled Silvio Berlusconi as a former Italian president. He was prime minister. The article has been corrected.

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