Kushner’s firm pulls out of Trump-branded hotel deal in Serbia

The private equity firm headed by Jared Kushner, President Donald Trump’s son-in-law, said Monday that Kushner was withdrawing from a planned Trump-branded real estate deal in Serbia.

The announcement came hours after Serbian prosecutors charged four senior government officials there with corruption in connection with the $500,000 project.

The decision dooms a deal that had exemplified the willingness of foreign governments to bend over backward to further the financial interests of Trump’s family. President Alexander Vucic of Serbia, who has been seeking Trump’s help all year on economic issues, has fiercely championed the proposed complex in downtown Belgrade, the capital.

A Cabinet minister was the highest-ranking official charged. He, one of his aides and two officials who had to approve the project were all charged with abuse of power and forgery.

While members of the Trump family have pursued a number of foreign deals this year, the Serbian project stood out because it triggered a foreign investigation into allegations of corruption. Vucic has denied any government impropriety with the project.

A spokesperson for Affinity Partners, Kushner’s firm, said the company was pulling out because “meaningful projects should unite rather than divide and out of respect for the people of Serbia and the city of Belgrade.” The decision was reported earlier by The Wall Street Journal.

Affinity Partners, which is largely financed by foreign sovereign wealth funds, has recently drawn attention for helping Paramount mount a hostile bid to buy Warner Bros. Discovery. Warner’s holdings include CNN. The Trump administration will need to approve of any such deal.

The Serbian project, in the works for years, involved both Kushner and the Trump Organization, run by the president’s sons Eric and Donald Trump Jr. It would have replaced bombed-out buildings near the Serbian government’s ornate headquarters with apartments and a luxury hotel bearing the Trump name.

Although the structures to be torn down were heavily damaged, Serbian law had designated them as a cultural asset and a national icon to the Serbians’ suffering during the NATO bombing of Belgrade in 1999.

Just days after Trump’s election last year, Serbian officials began to override those protections. That triggered not just a public outcry, but also resignations by at least two officials involved in handling approvals for development. Another former official said Serbian intelligence agents “strongly advised” her not to object to the development.

About six months ago, a top lawyer for Kushner’s firm flew to Belgrade to assess the situation. Serbian officials told him then that the controversy boiled down to a simple administrative error, according to a person familiar with those discussions.

While Vucic has pushed the development as a way to attract more tourists and revenue to the nation’s capital, his critics asserted that he was subverting Serbian law to please the White House.

“Knowing Trump’s transactional approach, it was his bet this would appeal to him,” Dragan Jonic, an opposition-party member of Serbia’s parliament, said in an interview Monday.

Last month, arliament approved a law to override the cultural heritage protections of the site. It was drafted under a constitutional procedure that experts said was intended for use only in extreme circumstances.

In an interview with The New York Times in November, Vucic said the government needed to move ahead despite the allegations that a key document had been forged.

“We were bombed in 1999 — it’s 26 years,” he said. “Now, we found an opportunity and a good investor that will be ready to pay a huge amount of money.”

In its statement, the prosecutors’ office said it was continuing to investigate other individuals.