the truth behind trump tower moscow
The project at the core of the Mueller investigation wasn’t a well- planned conspiracy. Instead, an unprecedented look inside the deal reveals a stunning degree of risk, with Putin at the center of it, for relatively little potential reward.
It’s getting late, and Felix Sater—a onetime Trump partner, two-time convicted felon and longtime federal informant—sits in the back of a New York City restaurant, ready for a drink. “A very dirty martini, Russian vodka,” he tells the waiter. “A collusion martini.”
No one outside of the Trump Organization has more firsthand knowledge of Donald Trump’s connections to Russia than Felix Sater. In 2006, he scouted a potential deal in Moscow with the president’s children Don Jr. and Ivanka. In 2007, he stood alongside Trump at a launch party for a hotel Sater had helped get built, Trump SoHo, which marketed partially to Russian buyers. And
during the 2016 presidential campaign, Sater helped plan a giant Trump tower in Moscow.
“Here’s to fun times,” he says, hoisting his martini glass in the air.
Fun times indeed. Special Counsel Robert Mueller’s 448-page report highlights three separate proposals to develop a Trump property in Moscow around the time of the election. Yet key details have remained vague. Forbes got in touch with the people at the center of all
three—and uncovered concrete answers to fundamental questions about Trump’s plans in Russia.
Such as who was actually going to pay for the project. Trump, now more of a licensor than builder, certainly wasn’t planning on putting in much of his own money. And according to Sater, who brokered the proposal that extended furthest into the campaign, nor was Trump’s official partner, Andrey Rozov. Instead, Sater says, he was cooking up a plan to raise huge sums from additional investors, including two of Vladimir Putin’s closest cronies, Boris and Arkady Rotenberg. “We would have gone to them and asked them for four or five hundred million dollars cash,” Sater says.
Another big, previously unsettled question: How much money could Trump have made in all of this? Both Mueller and former Trump attorney Michael Cohen have suggested, vaguely, “hundreds of millions.” After mining business agreements and surveying real estate experts in Moscow, however, Forbes believes that’s almost impossible. It seems more likely that Trump would have walked away with roughly $35 million up front and $2.6 million or
so in annual fees, if everything went according to plan. In the rosiest of scenarios, Sater says,
Trump could have gotten about $50 million. A lot of money to most people but less than 2% of the president’s net worth (estimated at $3.1 billion).
Taken together, these revelations paint a new picture of Trump’s plans in Russia and the president’s way of doing business. His deal came with far greater risk—and far less reward—than previously understood. In short, candidate Trump jeopardized his eventual presidency on a middling deal and one that would have had Vladimir Putin’s fingerprints all over it.
Part of the reason the Trump Tower Moscow narrative confuses people: There were three different attempts to attach the president’s name to a Russian property in recent years. The first one emanates from the infamous 2013 Miss Universe contest, where 86 women strutted through a Moscow concert hall. Donald Trump, the co-owner of the pageant, took home the money, collecting an estimated $3 million from the local hosts: billionaire real estate tycoon Aras Agalarov and his son Emin, a pop singer. “I had a great weekend with you and your family,” Trump tweeted afterward, tagging the elder Agalarov. “You have done a FANTASTIC job. TRUMP
TOWER-MOSCOW is next.”
One month later, in December 2013, the Trump Organization signed an agreement to brand an Agalarov property in Moscow, according to the Mueller report. The plan eventually called for 800 apartments near the concert venue that hosted the Miss Universe event, with 3.5% of sales going to Trump. If the whole building sold out, Emin Agalarov estimates Trump would have come away with $17 million or so.
Trump’s daughter Ivanka toured the site in February 2014. That same month, though, the geopolitical landscape was shifting. Crowds were in the streets of Kiev, protesting Ukraine’s Russia-friendly president, Viktor Yanukovych. He ultimately fled Ukraine, reportedly with the help of Putin. Within weeks, Putin sent soldiers into Crimea, a Ukrainian region neighboring Russia, effectively taking over. The landgrab sparked outrage in the international community, and the United States retaliated with economic sanctions.
Those measures, combined with falling oil prices, crippled the Russian economy—including the Moscow real estate market. The average price of new apartments plummeted an estimated 30% in 2014. Condos were selling for less than the cost of construction. Even in the unlikely event that the Agalarovs managed to build something amid all the turmoil, Emin Agalarov tells Forbes that
Trump’s payout would have been cut in half. Communications between the Trumps and the Agalarovs began to fade in the fall of 2014, according to the Mueller report. Donald Trump
Jr. later told the Senate Judiciary Committee the project died because of “deal fatigue.” A more likely cause of death: U.S. sanctions.
In November 2015, Donald Trump, by then a presidential candidate, sat down with former Fox News host Bill O’Reilly, who challenged him over his accommodating stance toward Russia. “[Putin] doesn’t make deals,” O’Reilly reasoned. “He just rolls soldiers in to cause destruction and shoots down airplanes.”
“Well,” Trump replied, “he does what he has to do.”
Unbeknownst to the American public, the Trump Organization, which did not respond to requests for comment on this story, was secretly communicating about a second potential deal in Russia around the same time. In September 2015, nearly a year after the Agalarov partnership dropped off, and with Trump now leading the Republican primary race, his lawyer Michael Cohen traded messages with a man named Giorgi Rtskhiladze, according to the Mueller report. Cohen and Rtskhiladze had previously worked together on business in the former Soviet states of Georgia and Kazakhstan.
Rtskhiladze sent Cohen a draft of a letter ultimately intended for the mayor of Moscow, which pitched a Trump development as a symbol of strengthening ties between the United States and Russia, according to the Mueller report.
“[The mayor] is aware of the potential project and will pledge his support,” the note said, according to the report.
Today Rtskhiladze says he was just passing along the message on behalf of a longtime friend and that friend’s acquaintance. He claims the letter never made it to the mayor. And he suggests he’s not even sure if what he sent Cohen was accurate. “I don’t know if it’s true or not if [the] mayor’s office was ever notified, okay.”
That’s how it goes in Russia, a place where trust is in short supply and outsiders can suddenly find themselves in unnerving situations. Rtskhiladze says he had previously warned Cohen of the risks: “You have to be careful who you get involved with.”
Caution, however, is not the Trump way. Cohen dismissed the Rtskhiladze plan and chose to pursue a third proposal, brokered by a man with a checkered past: Sater. Moscow-born, Brooklyn-bred, Sater
started a career on Wall Street, until a bar fight—he stabbed a man in the face with a margarita glass—led to 15 months in prison. Three years after his release, he pleaded guilty to racketeering in a mob-connected pump-anddump stock scheme. He stayed out of prison this time by working with the feds, ultimately supplying information about the Mafia, North Korea, Russian cybercriminals, even Osama bin Laden. At Sater’s sentencing, about a decade after he began cooperating with the government, FBI agent Leo Taddeo, one of Sater’s handlers at the bureau, credited him with helping pave the way for law enforcement to “basically eliminate”
the mob from Wall Street’s penny stock business. Former FBI official Ray Kerr adds: “There was nothing he wouldn’t do or wouldn’t try.”
At the same time that he was serving as a federal informant, Sater reinvented himself as a real estate dealmaker. It was in that role that he ended up working with the Trump Organization, on projects in Arizona, Florida, New York and, ultimately, Russia. For the Moscow effort, Sater served as both broker and dealmaker. His friend Andrey Rozov, who did not respond to our request for comment, was officially the local developer in Russia, but Sater says he expected a cut for himself as well. Trump signed the letter of