Feds Investigated Bank That Did RE Finance Deals With Kushner Cos.
BofI Federal Bank, formerly known as Bank of Internet USA and under federal investigation until last year, played a role in two real estate deals involving Kushner Cos.
BofI is a web-based lender that specializes in loans shunned by other firms. Most of its operations are in California, where it is based, but it also has a presence in New York.
The Securities and Exchange Commission investigated BofI's lending practices and conflict of interest policies, The Real Deal reports. After various subpoenas in 2016, the SEC closed the investigation about a year ago without any action. Its deals with Kushner, presidential son-in-law Jared Kushner's family company, were not publicly known at that time.
According to filings with the New York City Department of Finance, in April the bank took over a mortgage previously owned by Kushner Cos. The transaction involved a roughly $30M loan on a development, 215 Moore St., in the Bushwick neighborhood of Brooklyn.
BofI said in a statement that the transaction was essentially a routine refinancing.
In another deal late last year, Kushner Cos. obtained a $57M bridge loan for One Journal Square, a project in Jersey City, New Jersey. Much of that total was from BofI Federal, Bloomberg reports.
One Journal Square got off to a rocky start when WeWork opted not to locate in the property. Much of the previous financing for the project had depended on the workspace specialist's participation.
The property received national attention in May 2017 when, during an event at The Ritz-Carlton Hotel in Beijing, Kushner’s sister, Nicole Meyer, mentioned her brother’s role in the Trump administration while she was pitching the $150M Jersey City residential project to more than 100 Chinese investors.
