The elite real estate of Russians, who were included in the British list of sanctions in connection with the war unleashed by Putin in Ukraine, may remain under arrest for many years. And, quite likely, it will lose value, because it is extremely difficult to get permission from the authorities even for basic maintenance.
This is the case with buildings belonging to organizations and individuals linked to former Libyan leader Muammar Gaddafi, which were sanctioned in 2011. writes Bloomberg agency, which analyzed the situation with Libyan and Russian real estate in Great Britain.
Russians hoping to have their real estate seized in the near future should look to previous waves of sanctions imposed after events such as the Arab Spring. The conclusion that can be drawn is – “it will last a long time”, – says Jeremy Gray, managing partner of James Andrew International, which oversees several “frozen” houses in London owned by the Libyan Investment Authority: “There is no light at the end of the tunnel. When I spoke to the government about the sanctions back in 2011, they said most of the assets they froze were never unfrozen.“.
According to Gray, the value of London buildings in the portfolio of the Libyan sovereign wealth fund has decreased over the past decade by more than £200 million ($240 million).
The Office for the Implementation of Financial Sanctions (OFSI), a division of the Ministry of Finance, which was overwhelmed with work after the start of the war in Ukraine, deals with the seizure of assets and the review of applications of persons on sanctions lists. OFSI does not maintain its own register of frozen assets, as their identification and accounting are not part of its responsibilities, which must be reported by accountants, lawyers and notaries working for sanctioned individuals, OFSI said in response to a request from Bloomberg. Therefore, the agency does not have all the information, the agency concludes.
To estimate the value of seized real estate linked to sanctioned Russians, Bloomberg analyzed data on real estate and corporate ownership, interviews and investigations by media and nonprofit organizations contained in registries. To estimate the value, the agency managed to help brokers and real estate sites.
The total value of seized assets, according to Bloomberg, is £2 billion ($2.4 billion). Meanwhile, Transparency International found another £700m ($838m) of oligarch-linked luxury real estate in London and Surrey, which is not subject to restrictions.
Property in Central London owned by sanctioned individuals and companies. Objects related to: Investment Authority of Libya (yellow), Russia (red), others (gray):
Note: Nearby objects are grouped into one circle. Source: Land Registry, Companies House, Bloomberg.
