In Cleveland, Ohio, USA, a federal judge gave her blessing to the sale of a downtown Cleveland tower by a company with Ukrainian ties that is under investigation by the FBI for possible money laundering.
This was reported by the Cleveland – real estate news.
The Miami-based Optima Ventures completed the sale of 55 Public Square to the K&D Group Thursday for $17 million, K&D Group CEO Doug Price said. The Willoughby-based company plans to renovate the 22-story office building, turning floors 2-11 into about 160 apartments and make improvements in a project estimated to cost $80 million. The top half of the building will remain as offices, the agency writes.
Optima’s sale of the building has been years in the making.
It was noted, that the FBI’s investigation into Optima culminated in a raid of the Cleveland office of one of its subsidiaries in August and forfeiture lawsuits for 55 Public Square and buildings the company owns in Louisville and Dallas. Federal authorities said Ukrainian powerbroker Igor Kolomoisky and his associates used Optima to launder tens of millions of dollars through U.S. real estate and businesses, with much of the money pouring into downtown Cleveland.
Justice Department attorney Shai Bronshtein wrote in a filing Tuesday that the sale will help preserve the property’s maximum value by avoiding fees related to mortgage, property taxes, and maintenance costs. It also means the property’s value can be maintained, as Optima “stopped investing in the building” and had little incentive to do so, the filing said.
Optima will put the sale’s net proceeds into an account maintained by the federal government, as a judge could order the money forfeited later.
Court records show that Optima was financially underwater in its ownership of the building. Cooke’s order noted that the company defaulted on the mortgage and owes more than $14 million, as well as more than $1.1 million in unpaid property taxes and penalties.
According to the agency, about 40% of the office building, completed in 1958, is occupied. It remains the home of First National Bank, which has its name displayed at the top of the building.