Revealed: Saudi royals' secret $1bn US empire
BP and BAE Systems among the tenants of portfolio of properties associated with king's son Prince Abdul Aziz bin Fahd
Stephen Foley is a former Associate Business Editor of The Independent, based in New York. He left in August 2012. In a decade at the paper, he covered personal finance, the UK stock market and the pharmaceuticals industry, and had also been the Business section's share tipster. Between arriving with three suitcases in Manhattan in January 2006 and his departure, he witnessed and reported on a great economic boom turning spectacularly to bust. In March 2009, he was named Business and Finance Journalist of the Year at the British Press Awards.
Wednesday 06 June 2012
A secret $1bn US property empire amassed by members of the Saudi royal family is the subject of a bitter legal dispute that threatens to reveal the extent of the family's American business interests.
The oil giant BP and the British defence contractor BAE Systems are among the tenants of companies associated with Prince Abdul Aziz bin Fahd, the playboy son of the late King Fahd, according to court documents.
Lawyers for the companies are asking a judge to keep their ultimate ownership secret, but correspondence between the two sides currently remains on the record in a New York courthouse.
The documents reveal that over the past 15 years, Prince Abdul Aziz and a relative, Sheikh Khalid N Al Assaf, amassed a property portfolio that spans the US, from BAE offices in Reston, Virginia, near the capital Washington, to the headquarters of the television company Starz in California. They also purchased two of the four buildings in the office complex that BP uses as its US headquarters in Houston, Texas.
In an affidavit provided to the court by David Hill, a Texan real estate executive who says he helped manage the portfolio, it is claimed that the royal family held ownership of the properties through a complex network of foreign and US companies. Since 1996, Prince Abdul Aziz and his co-owners made a profit of $379m buying and selling properties in the US and they still own 15 complexes across nine states, for which they paid $978m, Mr Hill says.
The prince met his US property managers repeatedly * Los Angeles, the Bahamas, Cancun in Mexico, and at the Al-Yamamah royal palace in the Saudi capital Riyadh, according to the affidavit.
Prince Abdul Aziz is the youngest son of King Fahd, with a personal fortune estimated in the billions of dollars. He has few governmental responsibilities of his own, and his international playboy lifestyle was on show in another New York court earlier this year when one of his entourage was convicted of raping a woman at the swanky Plaza hotel, where the prince had rented more than 50 rooms.
The claims about the Saudi royal family's extensive US property holdings have come to light in a case in New York Supreme Court involving Mr Hill and a business partner, Howard Hallengren. The two men and the firms they worked for mismanaged the portfolio and took unapproved fees, it is claimed. The pair say the claims are untrue and are petitioning the court to prevent themselves being dragged into arbitration.
One of the claims is that their firm took illegal payments running into hundreds of thousands of dollars when BP negotiated with them to extend its lease in Texas in a new five-year deal worth $49m.
Lawyers for the portfolio companies, meanwhile, are fighting to keep the prince's identity secret. Naming the "ultimate and beneficial owners" is irrelevant because the case involves only US-incorporated entities, attorney Justin Garbaccio wrote to the judge, and Mr Hill and Mr Hallengren have named them "solely to harass and/or embarrass those parties... When faced with the instant application to seal [the names], petitioners took the opportunity in their response to repeatedly and gratuitously name said 'owners' as often as possible."
Lawyers for the two sides in the court case did not return phone calls requesting comment.
- 1 Is this bridge haunted by the ghost of nu rave?
- 2 Woman filmed launching racist tirade against men on the Tube for speaking in 'own lingo'
- 3 The West has it totally wrong on Lee Kuan Yew
- 4 Scientists have discovered a simple way to cook rice that dramatically cuts the calories
- 5 Noel Gallagher: I lost sh*tloads of money, a few million, didn’t tell my wife
Is this bridge haunted by the ghost of nu rave?
Saudi Arabia says it won't rule out building nuclear weapons
Germanwings plane crash: Andreas Lubitz 'had eyesight problems' and woke from nightmares 'screaming we’re going down'
Jeremy Clarkson 'could be given minder' ahead of a potential Top Gear return
Zayn Malik's departure from One Direction shows the perils of fame in the age of social media
Ukip supporters are 55 or older, white and socially conservative, finds British Social Attitudes Report
JK Rowling responds to fan tweeting she 'can't see' Dumbledore being gay
Jeremy Clarkson sacked live: Alan Yentob 'wouldn't rule out' ex Top Gear host's BBC return
David Cameron calls Labour 'hopeless, sneering socialists' while announcing 7-day NHS plans
Revealed: Putin's army of pro-Kremlin bloggers
The West has it totally wrong on Lee Kuan Yew
iJobs Money & Business
Negotiable: Recruitment Genius: To provide a prompt, friendly and efficient se...
Negotiable: Recruitment Genius: You will be the first point of contact for all...
£18000 - £24000 per annum + benefits: Ashdown Group: HR, Payroll & Benefits Of...
£35000 - £38000 per annum + benefits : Ashdown Group: A highly successful, int...