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Ed Webb

In Istanbul and Dubai, Russians pile into property to shelter from sanctions | Reuters - 0 views

www.reuters.com/...y-shelter-sanctions-2022-03-28

UAE Turkey Russia investment capital migration war economy

shared by Ed Webb on 03 Apr 22 - Cached
  • Wealthy Russians are pouring money into real estate in Turkey and the United Arab Emirates, seeking a financial haven in the wake of Moscow's invasion of Ukraine and Western sanctions, according to many property companies.
  • "We sell seven to eight units to Russians every day," said Gul Gul, co-founder of the Golden Sign real estate company in Istanbul. "They buy in cash, they open bank accounts in Turkey or they bring gold."
  • While Turkey and the UAE have criticised the Russian offensive, Ankara opposes non-U.N. sanctions on Russia and both countries have relatively good ties with Moscow and still operate direct flights, potentially offering routes out for Russians and their cash.
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  • Russians have been big buyers of Turkish property for years, behind Iranians and Iraqis, yet the real estate players said there had been a spike in demand in recent weeks.
  • Ibrahim Babacan, whose company in Istanbul builds and sells real estate mainly for foreign buyers in Turkey, said in the past many Russians had wanted to live in resorts such as the Mediterranean Antalya region. Now they were buying apartments in Istanbul to invest their money.
  • Both Turkey and the United Arab Emirates offer residency incentives for property buyers. In Turkey foreigners who pay $250,000 for a property and keep it for three years can get a Turkish passport. For a slightly smaller sum Dubai, a major Middle East business hub, offers a three-year residency visa.
  • "Investors are looking for both capital protection and the opportunity to receive a residential visa in the UAE for temporary relocation," said Elena Milishenkova of real estate brokerage Tranio, based in Moscow and Berlin, which has a focus on Russian clients buying property overseas.
  • Some newly arrived Russians in Turkey have struggled to make deposits and transfers at banks that are wary of contravening sanctions
  • The UAE issued guidelines to banks last year to tighten procedures identifying suspicious transactions in an attempt to stem illicit financial flows. That did not stop the country, like Turkey, being added to a list of countries monitored by the FATF global financial crime watchdog.
  • Caldas and Alex Cihanoglu, a realtor also based in Turkey's largest city, said some Russians were using cash converted from cryptocurrency, now that sanctions had made financial transfers more complex."I would say most of the transactions that we're seeing are in crypto," Caldas added. "Crypto, especially for this market now, in the difficulties they're facing, is the channel that is being used."
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