What Does the Russian Ministry of Foreign Affairs Own?

Sanctions are sanctions, the MFA still has a golf course and is working with Americans.
09.08.2017
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The Russian Ministry of Foreign Affairs, in response to US sanctions, recently expelled diplomats and seized the Moscow residences of Serebryanyi Bor from the Americans. However, in a parallel reality, the MFA conducts business and represents the interests of Americans. Anastasia Khlopkova found out what commercial objects and companies belong to the Russian Ministry of Foreign Affairs.


MFA Enterprises

Since 1991, the state enterprise FSUE Main Production and Commercial Department for Servicing the Diplomatic Corps (Main Administration for Service to the Diplomatic Corps under the Russian Ministry of Foreign Affairs (MASDC)) has tracked where and how the employees of the Ministry of Foreign Affairs of Russia spend their vacations.

The organization is headed by Alexei Izotov, who declared an income of 5.6 million rubles in 2016. During the same year, the head of the Russian Foreign Ministry, Sergei Lavrov, earned 6.8 million rubles.

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Head of MASDC under the Russian Ministry of Foreign Affairs Alexey Izotov

The MASDC is in charge of practically all important divisions of diplomats. The office belongs to the Moscow private clinic Meditsentr. In accordance with an international agreement, foreign diplomats are treated there free of charge. In 2017, the MFA allocated 32 million rubles for this service.

For the past two years, almost 20 million rubles have been invested in the clinic for the medical center to buy medical furniture and equipment. The department received two contracts for 840 million rubles and 950 million rubles for the purchase employee business trip tickets as well from the MFA.

The MFA department is engaged in servicing the buildings of foreign embassies. For example, MASDC held an auction for 2.3 million rubles for "author supervision and scientific management" services for the restoration of the New Zealand embassy in Moscow in 2017 (44/2 Povarskaya St.).

The MASDC’s main costs arise from their elite facilities: out-of-town residences, golf courses and housing complexes. The state enterprise owns a residence, a golf club on the Novorizhskoe highway, the Moscow Country Club and the recreation center Zavidovo in the Tver region. The company serves and rents out private apartments in Moscow's residential complexes.

It was allocated 150.8 million rubles from the diplomatic budget in 2017 for maintenance and sanitary services for its properties. In total, from 2012 to 2017, for all the facilities MASDC spent 21.3 billion rubles.

From “Moskva” to “Moscow”

Perfect lawns, birch groves, slender pine trees and unspoiled lakes surround the Moscow-based five-star residence Moscow Country Club (founded in 1994 as the Le Meridien Moscow Country Club). The more than 1.2 million square meters of land is equipped with log cabins, a professional golf course and restaurants.

In 1973, an American businessman Armand Hammer offered Leonid Brezhnev a draft of the golf course. Construction began near the village of Nakhabino only in 1988. It was the first 18-hole championship golf course in Russia (6542 sq. m.). Designed by an American architect Robert Trent Jones, Jr..

"Here live those who are no longer passionate as much with big money and have learned to appreciate the modest dignity of the person who found his path in life. And it is expensive. The rental of one hut costs from 15 to 25 thousand euros per month. Plus 10-15 thousand euros per year for additional expenses," described journalist Dmitry Sokolov-Mitrich, who visited the MFA territory in 2009.

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The complex outside Moscow Moscow Country Club

The former Mayor of Moscow Yuri Luzhkov and his wife Elena Baturina used to spend their Sundays (2007-2008) in "Moscow." The current mayor of the capital Sergei Sobyanin has not shown an interest in this place, and rental prices have fallen. In 2017, the cost of one month of living in a cottage costs from 450 to 600 thousand rubles (this is less than € 9 thousand), townhouse rental per month starts from 300,000 rubles.

A stage of the PGA European Tour (a series of professional men's tournaments in Europe) and the competition for the Cup of the President of Russia is held here. Noted dignitaries have played on the course, in 2003, Japanese Prime Minister Junichiro Koizumi, in 2004, Kent Michael and the President of Kazakhstan Nursultan Nazarbayev.

"The golf course is not a political arena. Friendship is strengthening here. Regardless of political views and religious beliefs," the head of MADCS Alexei Izotov philosophized when opening an international charity tournament in June 2017.

More than 80 million rubles have been collected over 23 years at the course. The money went to children's hospitals and boarding schools.

In 2016, 4.5 million rubles were allocated for fertilizers, 4 million rubles were paid for sports goods and golf accessories and to repair one villa 4.8 million rubles was used from the MFA budget.

New furniture is regularly ordered from IKEA for the hotel. In 2014  German furniture made of oak, beech and walnut was purchased for the cottages with a cost of 5 million rubles.

Englishman Nile Sweeney is in charge of training at “Moscow." Before he trained the national teams of England, Germany, Wales, Cyprus and Russia.

Tverskoy massage, alcohol and Patrushev

"There is 119 versts to Moscow and 558 versts to Saint-Petersburg," says the index in the recreation center "Zavidovo" in the Tver region. This land, located on the banks of the Volga and Shoshi rivers, occupies 554.6 thousand square meters.

The complex was founded in 1957, when a sport fishing and hunting base for the diplomatic corps was built. It is located in the neighborhood of the Zavidovo National Park, where the official residence of the Russian president is located.

There is a tennis court and a golf course in “Zavidovo” and the MFA’s Tver island is surrounded by water, so they often hold expensive boat and yacht exhibitions there. They have even installed a floating gas station on the lake, which the MFA allocated 23 million rubles for.

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The complex "Zavidovo" occupies 554.6 thousand square meters

To rent a "diplomat" room for the weekend costs 9.5 thousand rubles. Cottages "Turkey" and "Ambassador," from 38 to 45 thousand rubles. According to state purchases, in 2017, the "President service" (the structure of the Presidential Affairs Office) booked rooms in Zavidovo totaling a costs of 700,000 rubles and Sberbank, 1.2 million rubles.

Last year, alcohol (12 million rubles), massage services (4.8 million rubles) and fresh-frozen brooms for a bath (1,1 million rubles) were ordered for diplomats.

In May 2017, fighters against hackers, terrorism and "color revolutions" rested in the complex. A reception on behalf of the Secretary of the Security Council of Russia Nikolai Patrushev was organized for employees of the special services from 95 countries in Zavidovo. The Office of the President of Russia paid 12.7 million rubles for the international meeting of the special services.

America under cover

The development company Hines was founded in 1957 by Gerald D. Hines, who opened his first office in the center of Houston. In the 1970s, Hines built One Shell Plaza (50 floors) in Houston, and in the 1980s built the Bank of America (56 floors) banking center.

Now it is a major international real estate company, with a reported “2.9 billion assets under management."

"For more than 20 years, Hines company has created a strong presence in Russia - one of the few US companies engaged in commercial real estate," their website reads.

Hines entered the Russian real estate market in 1991, opening UPDK-Hines LLC in Moscow and secured the trademarks Hines and Park Place Moscow in Russia.

The main owner of UPDK-Hines was Hines-Leninsky Prospekt LLP (USA), the second owner was MASDC. The general directors until 2014 were Americans Lee Stewart Timmins and Jeffrey Brian Lennon.

In 2016, Russian Foreign Affairs Minister Sergei Lavrov suggested to President Vladimir Putin to respond to the US anti-Russian measures by kicking 35 American diplomats out of the country. At the same time, the Hines subsidiary, UPDK-Hines, was fully registered to the structure of the Russian ministry. Instead of American citizens, Alexander Podvyaznikov was appointed to be a head of the company.

Former head of the Moscow branch of Hines, Lee Stewart Timmins is a member of the directors of the PIK group of companies, whose major shareholders are dollar billionaires Sergey Gordeev and Alexander Mamut (who in 1990, was advisor to the head of the presidential administration Alexander Voloshin). On the Russian website of Hines, Timmins is quoted as the general director of the Eurasian region of Hines, "which covers Russia, Central and Eastern Europe and India."

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Park Place Moscow at Leninsky Prospect in Moscow

Hines has several properties, including the Outlet Village Belaya Dacha, Lesnaya Plaza, Donskoi Posad and Park Place Moscow. The Moscow housing complex "Park Place Moscow" (Leninsky Prospekt, 113) is listed on the MASDC website. The Residential Complex has 300 apartments, office space, a gym with a tennis court and 275 parking places with a car wash. The Multifunctional Center "Donskoy Posad" (Stasova Street, 4) also belongs to the Ministry of Foreign Affairs.

The MFA allocates money for maintenance and servicing of these commercial complexes. In November 2016, MASDC announced an auction worth 11.3 million rubles for "reconstruction of the automatic fire system and warning and control of evacuation of people in case of fire at the Leninsky Prospect, 113/1," where Park Place Moscow is located. The administration spent 4.3 million rubles to repair these five apartments. In July 2017, a state auction was held to install a safe children's play and sports grounds on the roof of the building on Leninsky Prospekt for 570,000 rubles.

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