• A total of $5.9 billion in transactions were handled by Namvar and Namco, including both investment funds handed to him, properties acquired and disbursements made.
• Namvar operated his business through a “dizzying array” of more than 400 limited liability companies interconnected through a “labyrinth” of complex ownership structures.
• The operation had vast family involvement, with relatives taking ownership positions in many properties largely purchased with investors’ money.
• Namvar tried to make favored creditors whole in the months before the bankruptcies in a series of questionable transactions.
• Since the bankruptcies, lenders have foreclosed on $424 million worth of property, with $130 million more in danger. That raises the possibility of highly diminished returns for creditors.
Namvar declined to be interviewed for this article, but he did issue a statement to the Business Journal saying the report contained “numerous factual inaccuracies and unfair personal attacks.” He also stressed his cooperation with the trustees through voluntarily turning over to them any limited liability company in which he, his wife or children had a personal interest.
“I have ceded control of the LLC(s) to the trustees at this time, even though those assets might arguably be outside the bankruptcy estate,” said Namvar in the statement.
An immigrant from Iran, Namvar amassed a real estate empire of more than 100 properties that he valued at as much as $2.43 billion in July 2008, according to documents obtained by the Business Journal and published last year. The investments included the Los Angeles Marriott Downtown hotel and the Cal Neva Resort at Lake Tahoe, both since lost to foreclosure.
The report does not provide a further tally of the total size of the portfolio, but does add details to how Namvar was able to build up such substantial property holdings.
Namvar told the trustees that his father, a well-established hard-money lender in Iran, became the country’s largest Jewish landowner before his property was seized during the 1979 Islamic revolution, prompting the family to immigrate to the United States. Hard-money lenders charge a high interest rate to borrowers who often are unable to secure bank financing.
Namvar built his own hard-money lending business by capitalizing on the family’s reputation in what the report called the “less restrictive” and “fertile ground” of the Iranian Jewish community of the Westside of Los Angeles. Namco generated what the report called “moderate returns” on the difference between the interest paid to its investors and the interest charged to borrowers.
For reprint and licensing requests for this article, CLICK HERE.
Stories You May Also Be Interested In
- Another Namvar Business Pushed Into Bankruptcy
- More Namvar Entities Put Into Bankruptcy
- Judge Clears Way For Namvar Sale
- Namco Owes Creditors More than $500 Million
- Line Forms to Recoup Millions Lost by Namvar
- Spotlight Shifts to Bankruptcies in Namvar Case
- Namvar Debts At New Heights
- Fraud Lawsuits Accumulating Against Namvar