The community needs to act now and stop the sale to LivWrk-DFH Partners (pronounced “Live-Work”), the business partners of Donald Trump’s son-in-law Jared Kushner, and Los Angeles-based developers CIM Group. They are coming to Crenshaw to displace long-time residents and price out future would-be Black residents. Companies like CIM, Kushner and LivWrk exist to make profits off changing the fabric of Black and Brown communities. I should know because I used to work for CIM. I left CIM in 2017 after sixteen months, once I saw how the company recklessly redeveloped the West Adams corridor with no consideration for the longtime residents or for the cultural fabric of the community.
Back in April 2020, CIM Group, described by WNYC as “Trump and Kushner’s Little Known Business Partner, “negotiated an agreement to buy the Baldwin Hills Crenshaw Plaza. The possibility of Donald Trump’s developer friends taking control of the Crenshaw Mall sent shockwaves across the United States. The day the story broke, the “Crenshaw Mall” hashtag united the nation online with hundreds of stories and thousands of shares concerning gentrification. CIM backed out of the sale in June due to community pressure and political opposition. When backing away from the deal CIM said, “They wished the community well.” Now we know they were plotting to regroup and come through the backdoor with another Trump-Kushner business partner, LivWrk.
LivWrk is based in New York City and has no projects or presence in Los Angeles, whatsoever. Interestingly, LivWrk does not even have the experience necessary to develop and build the project entitled for the Crenshaw Mall. Most or all of their development projects are adaptive re-use, in other words, the fixing-up of old buildings. They have participated as a junior development partner mostly in ground-up, new construction deals built by Kushner and CIM. They are less qualified to develop the Crenshaw Mall than the local development teams that submitted proposals.
As a former employee of CIM Group, I can attest that CIM and LivWrk are partners on several real estate projects in New York, along with Kushner Companies, which was run by Jared Kushner. When Trump was sworn in, Kushner’s dad, Charles Kushner returned to head the company. Charles Kushner is a white-collar criminal, who pled guilty to eighteen counts of illegal campaign contributions, tax evasion and witness tampering in 2005. When he returned to the company, he brought two of his former jail mates who had been convicted for money laundering, securities fraud, and lending fraud.
First, it is important to understand why Trump, Kushner, CIM and LivWrk want to buy the Crenshaw Mall. Their goal isn’t to own and operate a mall in a world where Amazon and online shopping continues to grow. It is to re-develop the Crenshaw Mall into a massive gentrification project to change the racial makeup of the Crenshaw community, like they’ve done in Brooklyn, where almost all of LivWrk’s projects have been.
Asher Abehsera, the Owner/CEO of LivWrk, has attempted to downplay his relationship with CIM and Jared Kushner, claiming in the LA Times, “Neither Jared nor his family have any investment in my company or this deal.” He said, “I have had no involvement with Jared since he went to work with his father-in-law [President Trump].” However, an article from May 2017, over six months into Trump’s presidency and over a year after Kushner went to work for Trump, Abehsera describes the relationship between LivWrk, Kushner’s firm, and CIM as a “very cohesive” partnership. He said, “We collaborate and speak every day.”
There is big money to be made redeveloping the Crenshaw Mall, because of opportunity zones, nick-named “gentrification zones” by civil rights activists. Created by Trump’s Tax Cuts and Jobs Act of 2017, an opportunity zone is a strategic, designated target made on an economically distressed community for new investments which will, under certain conditions, be eligible for preferential tax treatment. The mall has the potential to be the most lucrative opportunity zone project in the nation, and thereby the biggest chance to cash in on the replacement of working class and middle class Black and Brown people with more affluent white people.
Because it sits at a future subway station, a LivWrk project at the Crenshaw Mall using Transit Oriented Communities could be built without any parking spaces for the luxury residential units. Plus, there is no height restriction at the site, meaning LivWrk could quite literally build a 50-story Trump Tower at the Crenshaw Mall, all without ever going to the City Council for approval. It would be what is known in real estate as “by-right.” Such a deal would make LivWrk, Trump, Kushner and their business partners hundreds of millions of dollars in profit.
It is also known that LivWrk’s business partner, Kushner Companies has longstanding ties to Deutsche Bank. A financial disclosure form that Mr. Kushner filed with the government shows he and his mother have a line of credit from Deutsche Bank worth $5 million to $25 million. The bank also provided a $285 million mortgage to Kushner Companies last year to help it refinance a loan to purchase several floors of retail space in the former New York Times building on 43rd Street in Manhattan.” Deutsche Bank’s holding company, DWS Holdings, is in control of the Crenshaw Mall sale, so is that why they choose to sell the mall to LivWrk, an associate of their debtor?
Of the nine projects listed on LivWrk’s website, five are partnerships with Kushner Companies, CIM or both. Due to confidentiality obligations, I cannot speak publicly about the details of the real estate transactions I know of between LivWrk, CIM and Kushner but I’ve compiled information below that is available online to connect the dots. I encourage people to search “Kushner” and “LivWrk” online and conduct their own research. There is plenty to read.
The time is now for local investment to stabilize the historic Crenshaw community through the purchase of the Crenshaw Mall. Multiple, Black-led development teams submitted viable offers to purchase and re-develop the Crenshaw Mall. Downtown Crenshaw Rising was the most promising bid, with a literal “Dream Team” of global and local developers, one of which is a leading commercial developer in the United States on the Fortune 500 List, award-winning architecture firms, accomplished lawyers and deep financial backers. The Downtown Crenshaw Rising proposal provides housing the community can afford, community-centric retail, recreation and office space that is for the Black community, and by the Black community. The Downtown Crenshaw Rising proposal provides for local dividends, community ownership in the mall through investment opportunities for local residents, community ownership in the planning and re-envisioning phase, good jobs and community participation in the construction and operation, preference for worker-owned enterprises, and local preference for procurement contracts. It provides for a Community Stabilization Fund, which will buy homes and apartments in the surrounding area to preserve them as permanently affordable to the community.
Instead of embracing Downtown Crenshaw Rising, the current owners/investors of the mall (including Los Angeles County Employees Retirement Fund (LACERA), Los Angeles Fire & Police Pension, UC Board of Regents and New York City Employee Retirement System) have allowed this unscrupulous gaggle of Trump developers, LivWrk/Kushner/CIM Group, to make repeated attempts to secure the property in the face of community objection.
I am dedicated to this fight due to compassion resulting from my own personal history. I am a white woman. My mother, Annetta Jane Bancroft, was a brilliant artist who struggled with mental illness, lived off of SSI and had an insecure housing situation for many years. She bounced around the Venice/Palms area and Culver City, including Mar Vista Gardens, a public housing community, before moving to Crenshaw’s Morningside Park neighborhood with her companion Gerri. My mother passed away in 1999 at 56 years old.
Growing up in Los Angeles in the mid-90's was very different than today. Los Angeles was closer knit. We came together en masse, unified through Los Angeles’ music scene of hip hop like Freestyle Fellowship and Unity shows. When we were kids, we met at places like Century City, the Beverly Center, Fox Hills Mall, Baldwin Hills Crenshaw Plaza, Westwood, Venice Beach, Santa Monica Promenade and World on Wheels. We had friends from all walks of life and there was a lot more space for everyone. Now I see people I know and love barely able to survive, crushed by the weight of rents due to gentrification and the general cost of living. I am driven in my career to support the growth of Los Angeles’s disenfranchised communities through the creation of structured career paths in the construction trades and building affordable housing.
As a mother raising my own two daughters here in the Crenshaw community, I want responsible development and housing that is affordable to the longtime residents who have held the community together. I want to see local contractors and financial institutions reap the benefits of these major redevelopment projects. We need models for community wealth building and local ownership, instead of allowing the 1% to continue making billions off the redevelopment of low-income communities and displacement of working-class people, a.k.a. opportunity zones.
The opportunity exists for local financial institutions, the Black community, Los Angeles residents at all income levels to invest in a national model project, and fight back against unchecked development by Kushner, CIM Group and LivWrk in our own backyard. The Black community needs this as much as Los Angeles needs this. Responsible development by local firms with a proven history and the right intentions will make Los Angeles a better place for everyone. Please let your elected officials know that you want the Crenshaw Mall to be under community control. Get involved! Sign the petition at: www.downtowncrenshaw.com
Margaret Totty is a Native Angeleno, affordable housing industry professional focused on equity in the construction trades, and mother raising her child in Crenshaw’s Hyde Park neighborhood. She can be reached at firstname.lastname@example.org
LivWrk Projects with CIM, Kushner Companies or Both:
184 Kent Avenue/Austin Nichols House
LivWrk lists the Austin Nichols House on their website as a LivWrk project. It was originally a joint venture with Kushner Cos. Per a Globest article in July 2018, a news agency noted “An AP investigation found that over the past three years, more than 250 rent-stabilized apartments—75% of the building—were either emptied or sold as the Kushner Cos. was converting the building to luxury condos. Those sales so far have totaled more than $155 million, an average of $1.2 million per apartment.” According to the Globest article, the Associated Press reported that more than a dozen current and former residents at 184 Kent Ave. (Austin Nichols House) say they believe “the Kushner Cos.‘ relentless construction, along with rent hikes of $500 a month or more, was part of a campaign to push tenants out of rent-stabilized apartments and bring high-paying condo buyers in.” The article stated that the Kushner Cos. told the AP that it did not harass tenants to get them to leave.” But the data suggest turnover at the building known as the Austin Nichols House was significantly higher than city averages for coveted rent-stabilized buildings.”
85 Jay Street
In December 2016, Jared Kushner and his partners CIM and LivWrk purchased 85 Jay Street for $345M. A Bloomberg article published in 2018 provides some insight into the LivWk/CIM/Kushner deal structure, “About 95 percent of the planned development project is owned by CIM Group, a private Los Angeles-based investment firm. The remainder is owned by Kushner Cos. and LivWrk, a developer that has frequently partnered with the family company of Jared Kushner, son-in-law and senior adviser to President Donald Trump. The two smaller owners would reap half of the $23 million in fees for developing the building”.
According to an article from The Bridge, 85 Jay Street has been flying under the radar due to rezoning. “It’s not much discussed: while plywood fencing is up, with clanking site work underway behind it, 85 Jay has flown somewhat under the radar. Because no rezoning or special approvals were needed for construction, it has avoided the public negotiations that often accompany large projects, involving pledges of union labor, affordable housing, or cuts in parking accommodations.” This is very similar to the Crenshaw Mall deal, in that the property is in a Transit Oriented Communities Tier 4. This allowance along with other zoning would allow LivWrk to build a Trump tower at the Crenshaw Mall, with no parking requirements for residential units.
111 Montgomery in Crown Heights is a joint deal between LivWrk and CIM Group that just recently launched sales in May 2019. It is dubbed as “the neighborhood’s first luxury condo”. Crown Heights is a neighborhood in mid-gentrification. In a 2015 New York Times article, journalist Vivian Yee reported that “tenant advocates and lawyers believe that landlords in gentrifying areas like Crown Heights often withhold repairs or basic services from lower-paying tenants, hoping they will get frustrated enough to leave.” This practice of creating unlivable conditions and forcing tenants to move out is a form of harassment and abuse.
Dumbo: Watchtower Building at 25-30 Columbia Heights
In 2016, a joint venture between LivWrk, CIM Group and Kushner Companies announced the acquisition of the Jehovah’s Witnesses Watchtower Building located at 25-30 Columbia Heights. The transaction was reported to be $340 million. Referred to as the “new Trump Watchtower”, the Watchtower building rents commercial space to some very expensive tenants such as Etsy and WeWork. As a result, the nearby rents are soaring. Net effective rents on one bedroom start at $3,277 a month, two-bedroom two bath apartments start at $4,985 a month and three-bedroom two bath apartments start at $6,508 a month. Much as he did while working at Two Trees in the last decade, Mr. Abehsera is responsible for attracting the kind of restaurants and shops that have become synonymous with Kings County. Expect gluten-free bakers, Edison-bulb-lighted bistros, maybe a beer hall and of course sushi, all run by some classically trained, tattoo-covered chefs. “It’s going to be like our little hipster kibbutz,” Mr. Abehsera said. All of this to say, LivWrk does not have a history of working with existing businesses to thrive in spaces, only experience bringing in more elusive tenants paying higher rents.
Dumbo Heights Complex- 55 Prospect Street, 81 Prospect Street, 117 Adams Street, 77 Sands Street and 175 Pearl Street.
In 2013, LivWrk, Kushner Cos. and CIM Group purchased a six-building complex in Dumbo Heights, Brooklyn for $375 million. This was LIVWRK’s first acquisition that caters to high end tenants such as Etsy, Wework and Alexis Bitar, no focus on small or disadvantaged businesses. It is considered a property that is geared towards tech and provides a gourmet market. As of April 2020, an article was published that states Dumbo Heights is co-owned by the Kushner family, and Aby Rosen and Michael Fuchs’ RFR Holdings, LLC banks put Dumbo Heights on a list for potentially troubled debt which triggered the lenders’ right to review new leases and major changes to leases, according to lender reports. (Fuchs’ daughter, 20-something socialite Sage Fuchs, is the second half of the team selected by Deutsche Bank’s DWS to purchase the mall with LivWrk: DFH Partners). In 2018, Dumbo Heights took on $480 million in loans, including $300 million of higher interest debt from funds operated by South Korean insurers Shinhan Financial Group and DB Insurance Company. Both companies count that country’s national pension service among largest owners, with about 10% stakes in each.
(Margaret Totty is a Crenshaw Community Resident and former CIM Employee. Views expressed here are those of the author and do not necessarily reflect those of CityWatch or other CityWatch contributors.)