PETALING JAYA: The New York Times (NYT) journalist who co-wrote the story about the ownership of high-end properties in the United States by Malaysian investor Jho Low, told a Malaysian radio station the story was born simply out of the need to uncover the reason behind rising real estate prices in New York.

Noting that prices for luxury properties in cities like Los Angeles, Miami and New York were rising, Louise Story told business radio station BFM how she and her colleague, Stephanie Saul, had heard people say that a lot of units in high-end developments were purchased by foreigners.

In her Feb 9 article headlined “Well connected at home, young Malaysian has an appetite for New York”, she described how Low, whose full name is Low Taek Jho, in 2010, began making some very expensive real estate deals in the US using shell companies.

Story had set out to uncover who these foreign buyers were, only to find that there were few details.

“Today, more than half of the buying in New York and nearly half of the buying across the country in high-end property are purchased by shell companies, which are corporate entities set up just for the purpose of buying real estate.

“What they do is generally keep the owner secret, so no one really knows who the buyers of the properties are,” she said in an interview on the The Evening Edition show yesterday.

Story said she wanted to lift the veil on these shell companies and started looking at a handful of buildings in New York City, including the famous Plaza Hotel which had been converted into a condominium.

“We ended up deciding to zero in on one complex called the Time Warner Center which is next to Central Park in Manhattan,” Story said of her investigation that started in the middle of 2013.

The journalists — methodically, unit by unit — started to crack through the shell companies and found that some units had multiple layers of ownership.

“Some of them took weeks just to uncover one (owner) because it was one shell that was owned by another shell which was owned by another shell which is owned by a trust which is owned by another company before you even got to a person’s name behind it.

“And behind one of these units, we ended up getting to a person named Jho Low,” she told radio presenter Umapagan Ampikaipakan in the interview.

She said that when she looked at the macro picture of capital outflow of countries, she found China, Russia, India and Mexico on the list, but said she found it interesting that Malaysia was ranked along with these countries as well, despite being a smaller country in terms of population.

Story said Malaysia was interesting to her because during her time reporting here, she found that people were concerned over a culture of corruption and about money leaving the country.

“But it is not necessarily all nefarious,” she stressed.

Asked what kind of effect she thought the story might have, Story said she expected that many would be watching Low’s next steps with interest as he did a lot of “interesting and big deals”.

She also said that for this story, it was the first time the paper ran a summary of the story in Bahasa Malaysia.

The NYT story on Low was part of a series of five articles which began on Feb 7 on how the influx of global money has fuelled New York City’s high-end real estate boom.

Investigations by NYT journalists took more than a year and found that “nearly half of the most expensive residential properties in the United States are now purchased anonymously through shell companies and that the real estate industry does little examination of buyers’ identities or backgrounds”. — The Malaysian Insider

This article first appeared in The Edge Financial Daily, on February 13, 2015.