The latest New York deal by China’s Greenland Group took a new twist last week when it was revealed that the mainland mega-developer bought its 41 percent stake in Manhattan’s Park Lane Hotel from Jynwel Capital, a company controlled by Jho Low, a key figure in Malaysia’s $1 billion 1MDB Fund scandal.
An earlier announcement of the Park Lane Hotel deal by Greenland, made no mention of Jynwel, referring instead to a deal between the Shanghai government enterprise and Kuwaiti investment company Al Waseet International.
However, more recent reports reveal that Greenland acquired its stake from Low’s Jynwel, amidst a flurry of asset sales by the millionaire playboy. Low, who is said to be a close friend of Malaysian Prime Minister Najib Razak’s stepson, is said to have managed the troubled 1MDB fund, which is now at the centre of a reported six corruption investigations, including one by the FBI, regarding the misuse of at least $1 billion in investor funds.
Greenland Avoids Mentioning Jynwel
Low’s Jynwel was a prime backer of Witkoff’s plans to transform the aging Park Lane hotel into an 88-unit luxury condominium tower, taking a 41 percent stake in the deal when the New York developer led the $660 million acquisition in 2013.
When Greenland announced its entry into the project earlier this month, however, it avoided any mention of Low or Jynwel, and indicated that it had acquired the stake in return of issuing shares in its Hong Kong subsidiary to Al Waseet.
The Park Lane project still faces headwinds. Money has slowed from Chinese residential investors, previously a big driver in the New York market, and sales of luxury condos have suffered as a result. Several similar luxury condo projects in the vicinity of the Park Lane have seen sagging sales, with some attributing that to the Chinese money pullback.
Low Sells Off Artwork and Real Estate as Scandal Swirls
The Jynwel scandal involves Malaysia prime minister Najib Razak, who has been struggling to explain how $681 million from the fund was transferred to his personally accounts, allegedly under the direction of Low, who is described as a close friend of the Prime Minister’s stepson.
Investigators are now looking into the corruption allegations, and if proven, any U.S. real estate assets that has ties to Low could be seized, according to the New York Times, if a case could be made that the properties were purchased with proceeds derived from corrupt practices. By replacing Jynwel with Greenland, Witkoff and his other partners insulate the Park Lane project from any potential tie-ups related to Jynwel’s troubles.
The 34-year-old Low, who gained notoriety on the social scenes in New York and London by paying record prices for artwork and partying with celebrities such as Leonardo DiCaprio and Paris Hilton, has lately been making headlines for his cut-rate asset sales.
Low, whose art collection was at one time valued at $300 million last month sold a painting by Jean-Michel Basquiat for a reported $35 million. The Malaysian-Chinese collector had set a record for Basquiat works when he bought the same painting just three years ago for $48 million.
According to a report in the Wall Street Journal, Low has sold at least $205 million of art, including the Basquiat and several pieces by Pablo Picasso and Claude Monet that he auctioned for less than Sotheby’s estimates.