Saudi princes have sold more than $ 600 million worth of real estate, yachts and works of art in the United States and Europe since the de facto ruler of the country tightened his grip on the wealthy royal family’s wallet.
The deals represent a sharp change in the fate of aging princes who converted profits from oil in the 1970s and 1980s into investments in some of the most exclusive markets in the world. The huge sums of money have been largely spent on assets that are not easy to sell, or on current expenses that some members of the royal family have even reached $ 30 million a month to fund dozens of workers and a lavish lifestyle, and because they rely on the government to fund this lifestyle, any policy change can shock Their world.
Now, some members of the royal family are selling assets in foreign countries to generate cash after Crown Prince Muhammad bin Salman, 36, the country’s de facto ruler, dried up many of the funding sources previously used to fund extremist spending habits, say people familiar with the princes selling their assets.
The princes need cash to pay current bills such as maintenance of real estate, paying taxes, salaries to workers and parking fees on planes and boats, the people said. According to them, in some cases, they are also motivated to own less luxurious properties to avoid attracting the attention of Prince Muhammad, who has restricted their privileges and al-Saud family members’ access to state funds since coming to power in 2015. The Saudi government is aware of the sale of the princes’ assets.
“These people are not working, they have huge teams and they are scared [מהנסיך מוחמד]”, Said a man familiar with the transactions. The princes, the same man added, want” cash in their back pockets but to have no conspicuous capital. “
The prince turned off the tap
Among the recently sold properties are a $ 155 million country estate in Britain, two yachts more than 60 meters long, and jewels from the ancient Mughal Empire given as wedding gifts by King Manoah. The sellers, including former Washington ambassador Prince Bender bin Sultan, were once among the most powerful people in Saudi Arabia.
“Clearly they have been cut to a set and disciplined budget and they have to live on it,” said British historian Robert Lacey, who documents the history of the royal family that has ruled Saudi Arabia since the 1980s. Prince Muhammad “is here long term and he is changing things in long term thinking”.
A representative of Prince Bender said he had sold all his assets in foreign countries “because he saw a greater advantage in investing in the kingdom in light of the incredible work the Crown Prince is doing in creating all these investment opportunities.”
Prince Muhammad marginalized relatives who appeared to be potential rivals – including his uncle and nephew arrested in 2020 – and stopped the indulgences given to thousands of royalty, including paid holidays in foreign countries or the payment of water and electricity bills at their palaces in Saudi Arabia. Such indulgences have accumulated annual costs to the Saudi government of hundreds of millions of dollars.
The government is blackmailing the royal family in other ways as well
Senior members of the royal family have amassed billions of dollars each year through real estate and oil sales as well as deals with the government, and Prince Muhammad has gradually cut back on these contracts. In the case of family members who employ large teams, the tax amounts to hundreds of thousands of dollars a year.
One can learn from American diplomatic documents from the 1990s revealed by WikiLeaks that some members of the royal family made a fortune by taking loans from local banks without repaying them, confiscating land from the common people, or taking advantage of the visa system for foreign workers. People familiar with the financial affairs of the royal family say the princes continued to profit from such tricks until Prince Muhammad came to power. A system of grants to thousands of Saudi princes, which according to U.S. documents cost the Saudi government billions of dollars each year, has remained in place, one person said.
Many princes have adapted their lifestyles to changes in the world economy and to changes in Saudi Arabia where they have “turned off the taps,” the same man said.
“They had a standard of living that was beyond anything to be expected,” said another person familiar with the deals. “The expense is unbelievable. It takes them a while to adjust.”
The Saudi Ministry of Communications did not respond to questions about the financial affairs of members of the royal family.
Some of the Saudis who are currently diluting assets were temporarily detained at the Ritz-Carlton Hotel in Riyadh in 2017 in a move that critics described as a show of strength by Prince Muhammad. The prince for his part said the arrests were a step in his fight against corruption. Many of the detainees were released only after signing various financial arrangements. Arrests of prominent figures continued even after that, according to the Anti-Corruption Council in Saudi Arabia.
Among those detained at the hotel was also the late Turkish prince bin Nasser. The former Air Force commander was one of the people interrogated by the British Ministry of Defense, on suspicion of receiving bribes from BAE Systems in exchange for fat contracts for the supply of fighter jets and other military equipment to Saudi Arabia, in the arms deal known as the Al Yamana deal.
Most members of the royal family can no longer mediate in such transactions under the rule of Prince Muhammad. Representatives of the Turkish prince’s estate could not be reached and one of his brothers, who was still alive, did not answer questions about the British inquiry. The prince never spoke of the interrogation in public during his lifetime.
The Turkish prince sold a 61-foot yacht in 2020 and a $ 28.5 million home in the closed community in Beverly Park in Los Angeles in 2021, people familiar with the deals said. He died before the sale of the house was completed; His family’s response could not be obtained. The terms of the arrangement he closed to be released from detention in Britz could not be disclosed either. In the past, the value of a Turk has been estimated at over $ 3 billion, said one senior Saudi official.
Other princes who sold properties were never arrested. For example, in 2021, Prince Bender sold a country estate in Cotswolds, west of London, for $ 155 million, people familiar with it and the deal said. In the past he was close to the center of power in Saudi Arabia, and two of his children serve in prominent positions of ambassadors to Washington and London. In 2007, the British government unveiled an investigation into allegations that Bender also became rich from the Al Yamana deal. Prince Bender vehemently denied that the sums involved in the deal were secret commissions he had received.
Prince Bender is the son of the late Prince Sultan bin ‘Abd al-Aziz, one of the main branches of the royal family whose sources of income dried up under the rule of Prince Muhammad. The Turkish prince was a brother-in-law of Prince Sultan.
Estates and yachts for sale
The wealth accumulated by Prince Sultan has largely accumulated following his access to government funding, workers and resources for nearly half a century in which he served as defense minister, say people familiar with his legacy. Statements to banks viewed by the Wall Street Journal show that in a single year, he transferred tens of millions of dollars from government accounts at the Bank of Saudi Arabia to proxy accounts in Switzerland to help fund his lifestyle. “It all stopped 100%,” said a person familiar with the activity.
After Prince Sultan’s heirs felt the pinch of the measures taken by Muhammad, in 2020 they sold a mansion in the Knightsbridge neighborhood of London that sold for a record price of $ 290 million, said people familiar with the royal family and people familiar with the deal.
One of Prince Sultan’s sons, Prince Khalid bin Sultan, who commanded troops alongside General Norman Schwarzkopf in the first Gulf War in 1991, sold a mansion in Paris not far from the Eiffel Tower for more than $ 87 million in 2020 and a 67-meter yacht in 2019 , Said people who know him and the deals.
Some of Prince Sultan’s children are trying to mortgage international assets to fill a gap in funding from traditional sources of income, people familiar with the matter said. One of them, Prince Fahd bin Sultan, was sued by Credit Suisse in November for failing to repay loans he took out to refinance a $ 55 million yacht super and a $ 48 million estate south of London, according to court documents.
Princes Khalid and Fahd received a request through their representatives but declined to comment.
Gary Hersham, founder of the company specializing in luxury property Beauchamp Estates, was involved in some of the Sultan family’s deals, saying that in general, the younger generation of Saudi royal family no longer need or use the vast estates their ancestors purchased. They spend a lot and would prefer cash available, he said.
“They want to boast less, that’s the trend,” he said, adding that they had recently purchased some relatively small homes.