More Trouble for Tenants: To Pay or Be Evicted ... by Abramovich in Moscow

Posted on Mar 28, 2022. by NTI

If you are a multi-national company in possession of little or no conscience there is still pressure in being a tenant. And if you are a deported Russian garghy-billionaire, such as Roman Abramovich, you travel the bits of the world you are still permitted to visit in an 'investment vehicle'. Such is life in the spring of 2022.

Credit Suisse and Morgan Stanley banks, occasionally-maligned tobacco groups Imperial Brands and British American Tobacco, and law firms Baker McKenzie and Dentons are just some of the tenants of Abramovich’s landlord Millhouse investment group at their Moscow addresses. Recent items on the agenda of board meetings will definitely include: how can we pay rent to a disgraced friend of Putin who has recently received his come-uppance in the post from the UK and EU, barring companies from these jurisdictions making payments to him or his businesses?

Pay the rent and they run the risk of breaching sanctions. Don't pay rent and risk being evicted. 

The Millhouse portfolio in Moscow includes the two tower White Gardens complex and several other offices, such as the 31,325 square metre Krylatsky Hills Business Park used by Microsoft (halted sales), Intel (suspended shipments to Russia), BAT (withdrawing from Russia), Adidas (closed Russian stores) and Johnson & Johnson (will comply with sanctions - that's good of you); and Four Winds Plaza, used by Credit Suisse (will comply with sanctions - nice of them) and Morgan Stanley (“effectively not doing any new business in Russia” - what exactly does that mean?), according to the websites and brochures.

There is the added conundrum for staff in Russia complying with sanctions and being visited by Russia's Federal Counterintelligence Service in the dark hours. Cries of: "don't touch the door knob, grandma."

Meanwhile Heineken, the Dutch brewer, the world's second largest, has said its ownership of business in Russia “is no longer sustainable nor viable in the current environment. As a result, we have decided to leave.” It was probably the best decision in the world, despite the fact it will cost around €400 million to do so. Heineken said its 1,800 employees would be paid until the end of 2022, adding that the company “will do our utmost to safeguard their future employment”. Its Danish rival Carlsberg announced that its Baltika Breweries will be run separately, “with the purpose of sustaining our employees and their families”.

"So, are you getting out of Russia or not?"

"We really want to, but we make 9 per cent of our total sales in Russia ... and we also want to sustain our employees and familiies in the country ..."

"Call that a dilemma?"

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