The Chinese government now owns the Waldorf Astoria
Photo via Wikimedia
The Chinese government has taken control over debt-ridden Anbang Insurance Group, a Beijing-based firm known for snatching up prominent properties around the world for billions of dollars. One of those high-profile properties includes New York City’s iconic Waldorf Astoria, which the group purchased for $1.95 billion in 2014. According to the New York Times, the government takeover comes after Abang violated regulations, although the exact violations committed are unclear so far. Anbang will be overseen for one year by a group that includes China’s central bank, the country’s securities and banking regulator, the regular of foreign exchanges and other government agencies.
The China Regulatory Commission said it was taking over the company to protect insurance product consumers, claiming Anbang’s illegal activities threatened its ability to stay afloat. The group’s board of directors will also step down to make way for new members. The former chairman of Anbang, Wu Xiaohui, has been indicted in the city’s First Intermediate People’s Court for fraudulent fundraising and other financial crimes.
After the purchase of the Waldorf Astoria, Anbang, as well as other Chinese groups, ramped up its overseas deal-making. According to an investigation in 2016 by the Times, many shareholders of Anbang were family members or friends of Wu, making the company a target for corruption. Anbang claims over $300 billion in assets.
Wu event met with Jared Kusner, senior adviser and son-in-law of President Donald Trump, in November of 2016. He was looking to buy a stake in 666 Fifth Avenue, a Midtown Manhattan tower owned by Kushner Companies. The deal was called off after Members of Congress voiced concerns about Anbang’s connection to China, as well as the conflict of interest for Kushner as a White House aide.
The Waldorf is currently closed for renovations to convert part of the building into luxury condos. Anbang tapped Skidmore, Owings & Merrill to design the project, expected to take three years, which includes cutting the number of hotel rooms from 1,413 to 350 rooms.
[Via NY Times]
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