Ukraine Invasion Sparks Tenfold Rise in Russian Property Holdings
An investigation revealed that wealthy Russians bought real estate in Dubai worth $6.3 billion, increasing Russian real estate holdings more than tenfold after the Ukrainian invasion in February 2022.
The report released by the International Consortium of Investigative Journalists noted that while the surge of Russian investments in Dubai’s real estate in recent years had been documented before, newly obtained property records from 2022 offer fresh insights into the extent of this trend.
The information is based on estimations derived from the investigation under the banner of “Dubai Unlocked,” a recent collaboration between the International Consortium of Investigative Journalists and more than 70 media partners, with leading contributions from the Norwegian financial platform E24 and the Organized Crime and Corruption Reporting Project.
Over six months, an investigative report delved into Dubai’s flourishing yet clandestine real estate sector, revealing how politicians and individuals suspected of sanctions evasion—ranging from “cryptocurrency queen” Ruja Ignatova to alleged drug lord Daniel Kinahan—acquired properties in the city’s prestigious neighborhoods in the Middle East.
Matthew Cullen, the senior researcher at the European Union Tax Observatory, said: “We estimate that the volume of Russian money flowing into Dubai real estate increased more than tenfold after the invasion of Ukraine. “This shows how the city has become a major destination for elite Russians evading sanctions or fleeing the war itself.”
Out of the $6.3 billion valuation attributed to residential property acquisitions—a figure described as a “conservative estimate” in the report—$2.4 billion represented completed properties, while $3.9 billion constituted developments still in progress.
According to the investigation’s findings, investors in Dubai’s real estate market range from influential figures in Russian politics and government entities to prominent individuals in the business sector. Notable among them is Anna Chapman, the former spy arrested in New York in 2010 on espionage charges, subsequently repatriated to Russia as part of a diplomatic exchange.
Real estate records indicate that she bought an apartment in Dubai in early 2022 worth $566,000, shortly after promoting real estate investments in the city to her Russian followers on Instagram, according to E24.
In March 2022, shortly following the commencement of Russia’s large-scale invasion of Ukraine, Grigory Annikev, a wealthy member of Russia’s Duma, reportedly acquired a penthouse worth $13 million in the prestigious Serenia Residences on the Palm, as per investigative reports by IStories and accessible transaction documents
In April 2022, Irina Kupareva, Anikeev’s partner and mother of one of his children, also became the owner of a 140-square-meter apartment in the same Serenia Residences complex, IStories and The Times of Salta reported.
Earlier this year, the apartment was rented for $84,000 annually. The outlets reported that Olga Polyakova, the mother of one of Anikeev’s children, is also the listed owner of two properties in Dubai with a combined value of $3 million.
The property documents retrieved for the year 2022 through the Dubai Unlocked probe reveal that approximately 5,000 Russian individuals and companies are registered owners of around 6,600 residential properties in Dubai, totaling an estimated worth of $3.3 billion.
Furthermore, journalists discovered that numerous Russian citizens are present in the records under different nationalities and passport details. The utilization of multiple nationalities can aid individuals subject to sanctions in avoiding detection and scrutiny.
The team of economists approximated that the collective Russian investment in residential real estate in Dubai amounted to $4.8 billion in 2022, surpassing the disclosed figures from the leak. This places Russians as the seventh largest group among foreign owners of residential properties.
The researchers found that in 2020, foreign nationals owned nearly $98 billion worth of residential property in Dubai – a figure that jumped to $121 billion in 2022.
This represents 43% of the total value of all residential properties and is higher than any other city in the world with available estimates. By 2022, they will also have $39 billion worth of properties under development.
The investigation warned that the large volume and volume of foreign investment in Dubai’s real estate market represents a “vulnerability point related to money laundering.”
Markus Ferber, a member of the European Parliament and vice-chair of the Parliament’s Tax Affairs Subcommittee, underscored the vulnerability of the real estate sector to money laundering, stressing the need for increased vigilance and rigorous due diligence. In remarks to E24, Ferber suggested that Dubai appears to have embraced an approach that runs counter to these concerns, effectively transforming real estate into a venture that operates unconventionally.
The researchers noted that the volume of foreign investment in Dubai has implications not only for the emirate but also for other governments because it creates a “major blind spot for foreign tax authorities.”
For example, about 70% of Dubai properties owned by Norwegian taxpayers were not reported for tax purposes in 2019, according to a previous report.
The investigation made three policy recommendations to combat the potential flow of suspicious funds through Dubai real estate:
First, the inclusion of real estate in reporting agreements requires the automatic exchange of information, such as the OECD Common Reporting Standard which requires jurisdictions to collect and exchange information from their financial institutions with each other.
Second: Economists also recommended creating a global asset registry to help track wealth, property, and other assets and identify their true owners.
Third: There’s a renewed international push for the UAE to enhance its oversight of the real estate sector and to put an end to the pervasive money laundering activities.
