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The Mayfair mansion that’s been empty for 14 years

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As tem­per­a­tures plum­met to sub-zero and over a thou­sand peo­ple sleep roughon London’s streets, Who Owns England can reveal the Mayfair man­sion that’s been emp­ty for 14 years.

Moreover, it tran­spires that the prop­er­ty is on a long lease to the son-in-law of the President of Kazakhstan, a not­ed klep­toc­ra­cy, who has been hold­ing onto the man­sion in a bid to secure the valu­able free­hold from the Grosvenor Estate.

No. 41 Upper Grosvenor Street is an impres­sive Georgian town­house bought by a mys­te­ri­ous off­shore com­pa­ny for £28.5 mil­lion back in 2007, at a time when it had already been emp­ty for sev­er­al years. The Guardian not­ed in 2009 that “…the hand­some twin town­hous­es at Nos 41 and 42 have both been emp­ty for around five years 

Visiting the man­sion at the week­end, Who Owns England found the prop­er­ty was still clear­ly vacant, its let­ter­box taped up, with a notice next to it read­ing: “NO POINT JUNK MAIL IN EMPTY BUILDING.” Post had nev­er­the­less piled up inside the dusty front door.

The own­er of No. 41 since 2007 has been Merix International, a com­pa­ny reg­is­tered in the British Virgin Islands (BVI), a well-known tax haven. Here’s the land title.

For years the ulti­mate own­er of Merix International was an enig­ma. But in 2016, as part of a wider inves­ti­ga­tion, the Times (£) revealed its true con­troller: Timur Kulibayev, the son-in-law of the Kazakh President – and a bil­lion­aire oil mag­nate who’s the third-rich­est per­son in Kazakhstan.

Image: Timur Kulibayev. Source: Foreign & Commonwealth Office, pub­lic domain.

The link was uncov­ered thanks to a long-run­ning inves­ti­ga­tion by the Times and its Sunday sis­ter paper into a strange prop­er­ty deal involv­ing Prince Andrew. Journalists had been sniff­ing around the 2007 sale of Prince Andrew’s Sunninghill man­sion in Windsor to a mys­te­ri­ous anony­mous own­er, and dis­cov­ered it to be the Prince’s friend and hunt­ing part­ner Timur Kulibayev – who paid £3m more than the ask­ing price. Sunninghill lay emp­ty ever since, and has recent­ly been demol­ished. Commentators have asked whether the extra pay­ment had been to buy polit­i­cal access, some­thing always denied by both par­ties.

But it also lat­er tran­spired that Kulibayev, via his net­work of inter­lock­ing off­shore com­pa­nies, had bought the long lease­hold on 41 Upper Grosvenor Street too. This arti­cle recounts the com­plex web tying Kulibayev to No. 41 via his com­pa­nies Unity, Merix, Kipros Ltd and Kipros LLP.

So why did the son-in-law of the President of Kazakhstan pay a small for­tune for a lease on a Mayfair man­sion, only to leave it emp­ty for years?

There are two obvi­ous rea­sons.

Firstly, London’s prop­er­ty mar­ket con­tin­ues to be a sure-fire bet for any investor with a few mil­lion to spare. If you live in London, you don’t need a graph to tell you how insane house prices are; but the graph below by estate agents Savillsshows just how over­heat­ed it has been in the cap­i­tal even since the cred­it cri­sis.

As a Mayfair estate agent just around the cor­ner from No. 41 Upper Grosvenor Street puts it in some pro­mo­tion­al mate­r­i­al that I picked up: “Don’t wait to buy in Mayfair. Just buy in Mayfair and wait, because the best is yet to come.”

Source: Wetherell, a Mayfair estate agent.

Secondly, Mr Kulibayev appears to have been hold­ing on to the lease for long enough to buy out the valu­able free­hold.

In 2017, Merix International won a court case with the free­hold­er, the aris­to­crat­ic Grosvenor Estate, enti­tling them to buy the free­hold of the prop­er­ty at No.41 under the terms of the 1967 Leasehold Reform Act. This was despite it being left emp­ty for 13 years at the time of the court case. Legal observers con­clud­ed from the case, sig­nif­i­cant­ly, that “Just because this prop­er­ty looked inter­nal­ly like a derelict office, did not mean that it was not, in fact, a house. The ten­ant of this derelict build­ing was there­fore enti­tled to exer­cise its right to buy.” Freeholds are of course worth more than lease­holds.

There are thou­sands of emp­ty homes in cen­tral London, many of which – as Who Owns England and the Guardian has pre­vi­ous­ly revealed – are owned by wealthy busi­ness­men, oli­garchs, sheikhs and off­shore cor­po­ra­tions.

Enough is enough. London’s hous­ing cri­sis has reached break­ing point. Homeless peo­ple are lit­er­al­ly dying on our streets. An entire gen­er­a­tion is being left unable to afford homes. And yet we con­tin­ue to tol­er­ate wealthy bil­lion­aires using London prop­er­ties as mere invest­ment assets, con­tent to leave them emp­ty for 14 years, just to turn a prof­it.

At the bare min­i­mum, Westminster Council must start charg­ing the own­ers of emp­ty prop­er­ties a 100% coun­cil tax pre­mi­um – pow­ers grant­ed to coun­cils in last November’s Budget. And Councils that fail to do so should be held to account in this May’s London coun­cil elec­tions.

The Land Justice Network is organ­is­ing a tour of some of London’s emp­ty homes, includ­ing 41 Upper Grosvenor Street, on 14th April 2018. Join them to find out more about who owns London and call for change to end the hous­ing cri­sis. Details on Facebook herewww.landjustice.uk 

The Mayfair man­sion that’s been emp­ty for 14 years

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