Jared Kushner will have to hold onto his stake in Cadre, after the pandemic hit the startup’s bottom line.
The real estate investment startup, co-founded by CEO Ryan Williams and Jared and Joshua Kushner, was prepared to take over Jared Kushner’s stake in the firm back in February. But in the face of the coronavirus pandemic, the company was forced to cut costs, including the purchase of the White House adviser’s shares, according to Bloomberg.
For years, critics have said Kushner’s investment in Cadre created a potential conflict of interest while working as an adviser to his father-in-law, President Donald Trump. Last year, Kushner asked the White House to determine whether his shares created a potential conflict of interest. Once the sale was deemed necessary, the Office of Government Ethics agreed to let Kushner defer taxes on any gains related to the sale.
Cadre had welcomed the plan to sell Kushner’s stake following a failed investment from SoftBank’s Vision Fund in 2018, two sources told Bloomberg. In the eyes of lenders and partners, the Cadre’s association with Kushner risked the firm’s reputation.
Cadre, headquartered in the Kushner-owned Puck Building, is not yet profitable and completed its last capital raise in 2017.
The company’s CEO wrote in May that “while our current portfolio is holding up well thus far, we are navigating an environment in which real estate transactions have abruptly halted, and we can’t be certain how long this will last.”
Cadre cut a quarter of its staff the same month. Kushner withdrew his government request for a tax break on the sale in June. [Bloomberg] — Orion Jones
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