WASHINGTON – Jared Kushner has divested from Cadre, the real estate technology startup he cofounded, according to a person familiar with the matter, after the business attracted investment offers that could pose conflicts of interest for the White House aide.
Kushner, who is President Donald Trump’s son-in-law as well as one of his senior advisers, transferred his interest in Cadre to a trust that sold his shares back to the company. He recently listed his stake in federal disclosures as being worth between $25 million and $50 million, and the sale price was in that range, according to the person.
His brother, the venture capitalist Josh Kushner, maintains a stake in Cadre through Thrive Capital, his venture investment company.
The sale follows a Bloomberg investigation showing that SoftBank, the Japanese investment company, wanted Kushner to divest during talks about a potential investment in 2018. He didn’t, and the talks fizzled.
Abbe Lowell, a lawyer for Kushner, said he has complied with all ethics rules, including “divesting assets when appropriate.” He confirmed the divestiture from Cadre.
“When Cadre, with which Mr. Kushner has not been involved for over 3 years, decided to pursue opportunities that could unknowingly to Mr. Kushner become future conflicts, he took the guidance of White House Counsel and the Office of Government Ethics and put in place a blind divestment process,” Lowell said. “This is the latest example of how seriously he takes this responsibility.”
Other than being a passive shareholder, Kushner has had no role in the company since he joined the White House, said Alan Fleischmann, a spokesman for Cadre.
“Jared and Cadre are confident that this divestment will allow Jared to continue focusing on his work in Washington, and further accelerate the company continuing to fulfill its mission of expanding access and liquidity in commercial real estate investing,” Fleischmann said.
Representatives for Cadre approached Lowell last summer about investors interested in doing business with Cadre that might pose potential conflicts. In December, Kushner, after consulting with lawyers, decided to move the shares into a trust, the person familiar with the matter said.
The person asked not to be identified because Kushner does not publicly discuss his finances.
When Kushner made the decision to join Trump’s administration in January 2017, he hired Jamie Gorelick, former deputy attorney general under President Bill Clinton, to arrange an ethics plan to comply with conflict-of-interest rules.
The move was initially heralded because his father-in-law, Trump, hadn’t made as meaningful an effort. But the revealed plan involved divesting only some assets perceived as potential conflicts to close family. The exact nature of the transfers was never made clear, and they were later perceived by critics to be insufficient, in part because Kushner had run the family real estate company. He maintains a stake in entities associated with Kushner Cos.
Those problems came to a head later in 2017 when the company sought a deal with Anbang Insurance Group Co. for 666 Fifth Avenue, its deeply over-leveraged and troubled Manhattan office tower. A potential deal between the two companies, reported by Bloomberg News, showed unusually favorable terms, and it was scuttled after they were made public.
A more modest deal was reached in 2018 with Brookfield Asset Management, a Canadian investment firm whose largest outside shareholder is the sovereign wealth fund of Qatar.
Kushner’s role in the White House has cast a pall over other deals at his family firm. When his sister traveled to China to pitch Chinese investors, the presentation featured a picture of Trump and mention of Kushner’s White House role.
Kushner Cos. minted new partnerships with Israeli firms as Kushner led planning for Middle East peace talks, and last year the company obtained an $800 million loan backed by the federal government.
Both Kushner Cos. and Cadre have sought investments in opportunity zones, a federal designation created in Trump’s 2017 tax law that Kushner backed. The designation provides tax breaks for capital gains.
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