From an upscale shopping and arts center in Istanbul that touts luxe boutique shopping such as Prada, Balenciaga and Balmain, a Miami-based company is selling property in East and West Baltimore to Turkish investors.
With cheap home prices and high rents, Baltimore homes produce “the highest yields in the United States,” Property Invest USA’s CEO Cengiz Bayırlı tells potential investors in media appearances and social media posts filmed at places like the Istanbul Four Seasons hotel. He guarantees rent income for three years and assures investors that they can make back their money in 10 years.
The pitch has been enticing. Property Invest’s clients include a number of Turkish Airlines pilots who are members of a WhatsApp group promoting the Baltimore investments. Others come from Turkish high society, among them the daughters of a famous football manager and a national newspaper editor. Many work in the property sector themselves, as interior designers, developers and real estate agents, according to a review of names on incorporation documents filed in Maryland that use local mailing addresses.
Property Invest USA is one of a handful of companies marketing homes in the city’s distressed neighborhoods as cash-generating rental properties to foreign investors, according to an analysis by The Baltimore Banner. Another company based in Philadelphia, ABC Capital, has bought far more such homes and is facing a torrent of lawsuits and complaints from its foreign investors who say it is not following through on its promises. ABC has sued Property Invest in Baltimore Circuit Court for allegedly stealing its business model, a case slated for trial in December.
Property Invest has purchased more than 200 homes in Baltimore for investors since 2019 and has not faced complaints as ABC Capital has. Visits to nearly all of their properties show they are generally in good shape, the result of being maintained by a Highlandtown property management firm.
Still, about 20 percent of their properties are boarded up despite the guarantees of rental income. Some investors in Turkey contacted by The Banner expressed concern, while others shrugged it off.
“I’ve been getting the rental income for three years, no problem,” said Mete Kagan Ozel, a pilot who said he has been receiving a monthly rental income of $1,070 despite the property currently sitting empty.
Bayırlı, who is based in Miami, did not respond to requests for comment and served a cease-and-desist letter on a freelance journalist working with The Banner in Istanbul after she began making inquiries about the company.
“PIU provides all investors with information on the physical condition of the property, whether it is tenanted, and potential rental income at the time of sale,” the letter stated. It went on to say that investors are provided photographs of their properties, and that current images sent to investors by reporters were “unfounded, baseless and completely contrary to the material truth” and “aimed at damaging the commercial reputation of the company.”
A factor that could be driving investment is that Turkey’s currency crisis has sent property prices soaring by 241 percent in Istanbul over the past year, while government-imposed rent controls have limited landlords from increasing rents at the same rate. As a result, rents have only risen by 145 percent in the same period, leaving landlords struggling to make money back on their investments. A U.S. property purchase appears more alluring, with promise of a far higher rental yield.
The investors are buying their Baltimore homes for significantly more than Property Invest pays to acquire them. The company tells investors in promotional materials that the homes it is marketing cost $90,000 to $130,000. In 62 recorded transactions this year, Property Invest bought homes on average for $51,200 and re-sold them for $109,700. One of the most recently recorded transaction was a home in Northwest Baltimore acquired for $32,600 and flipped to the investor for $122,000.
All told, an analysis of records shows, Property Invest has been directly involved in buying properties in disinvested areas of Baltimore for at least $10.4 million and flipping them for $20.4 million.
How Property Invest moved into the Baltimore market
In Turkish media, Bayırlı said he came to the U.S. in the 1990s to get a master’s degree at Boston University and worked for the World Bank from 1996 to 1998. He told reporters he has been involved in Miami real estate for 20 years, though how exactly is unclear: His LinkedIn biography says he has led Property Invest since 2004, but the company was not incorporated in Florida until 2019. One year before that, he incorporated a company called “Turkey 2 USA” that was dissolved after seven months. The earliest posts on what is now Property Invest’s Facebook page are from 2016, promoting “Turkey 2 USA.”
Property Invest got its start by poaching an employee from ABC Capital, which had moved into the Baltimore market in 2016 after buying more than 1,500 homes in Philadelphia.
In 2019, Bayırlı courted the personal assistant to ABC Capital co-founder Jay Walsh, Ekrem Uysaler, who said he had been working at Philadelphia gyms and upscale clubs before he was taken under Walsh’s wing.
In the fall of 2019, Uysaler was contacted by Bayırlı, who said he wanted to obtain more information about investment opportunities, ABC Capital wrote in court records. Uysaler e-mailed Bayırlı a copy of ABC’s sales presentation and explained its income-producing real estate strategy, according to court records.
Eleven days later, Property Invest USA-MD LLC was formed in Maryland.
“Of course I trusted him. He’s Turkish; I’m Turkish,” Uysaler said in an interview with The Banner.
Uysaler, Property Invest’s man on the ground in those first months, says he was making $30,000 a month and living at a high rise in the Baltimore’s Harbor East area. He recalled once picking up three Spanish-speaking men from an airport who had brought cash to buy properties in Baltimore and Philadelphia.
“Uysaler focused on the Baltimore market as he learned from working with ABC that Baltimore has better profit margins than Philadelphia because of lower demand,” ABC Capital’s lawsuit against Property Invest says. “The defendants’ actions directly harmed ABC by increasing the costs for new properties by having more bidders, and by reducing ABC’s profits and margins.”
Just a few months into their new business venture, Uysaler says, he was squeezed out and his signature forged on documents. He’s also suing Property Invest.
In Turkish promotional materials, Bayırlı and his wife and business partner, Giovanna Guzman, are shown in sleek offices in Miami, entertaining people identified as reporters at the Istanbul Four Seasons with yachts passing by in the background on the Bosphorus Strait. “Amerika’da kira garantili yatırım” and “Kira garantili net getiri minimum %10″ flash on the screen — “Rent-guaranteed investment in America” and “Rent guaranteed net income minimum 10%.”
One Turkish website displays paparazzi-style photos of Bayırlı and Guzman walking hand-in-hand in the town of Bodrum. “Bayırlı and his wife Guzman, who are on vacation on their boats and sell housing to world-famous stars and Hollywood stars, and who own one of the largest 100 real estate companies in the USA took a walk on the beach of Türkbükü and visited the shops on the beach,” reads one translated caption.
Property Invest USA is one their ventures. The other, International Realty Group, is billed as a high-end real estate brokerage. In a June article in a Turkish publication, Bayırlı is quoted telling investors that Turks have invested $5 billion in Miami in the past three years, and that he expected that number to rise by 40 percent over the next two years. His company says its footprint has expanded from offices in Miami and Turkey to also include Mexico and the Dominican Republic.
Court papers show that Bayırlı, Guzman and 30 employees moved into a penthouse office in Miami’s Brickell financial district after partnering with a cryptocurrency company seeking to introduce non-fungible tokens, or NFTs, into the real estate buying process. That company let Bayırlı and Guzman move into their leased space, International Realty Group attorneys wrote in court documents filed in August in Miami after the crypto company sought to kick them out.
The company’s Istanbul office is decorated with glossy photos of developments in Miami, and its representative there is Elif Tezcan Bayırlı, the sister of the CEO. During a reporter’s visit to the company’s office there, she insisted that all the Baltimore houses, which she said the company buys in foreclosure, are renovated before or shortly after they are sold to investors. The company guarantees a rental income of at least 10 percent of the property price per year for three years, an assurance made because the homes receive Section 8 vouchers, she said.
The “hands-off” model makes Property Invest USA’s pitch an attractive proposition for Turkish citizens, who cannot easily obtain U.S. visas. Elif Bayırlı added that the company’s customers include Turks who have sold their properties in Istanbul and sunk the capital into houses in Baltimore.
‘$100,000 is not a small amount of money’
Property Invest works with Highlandtown-based Reliable Property Management to maintain its investors’ homes. Most have stickers with RPM’s phone number listed so tenants and neighbors know whom to contact regarding problems.
Keith Kaiser, the owner of Reliable Property Management, said that he manages 1,000 properties overall in Baltimore and that 90 percent of the owners are located outside Maryland or the United States. He said he only wants to work with responsible owners, and in some cases has broken contracts or referred good tenants elsewhere.
“When somebody comes to us and says can you take over some management, we’ve got a bunch of priorities,” Kaiser said. He said when he informs Property Invest of an issue with one of its investors’ homes and recommends how to resolve it, “I’ve never once had them come back and say no.”
Kaiser said he didn’t have insight into why some homes might be vacant months or years after being sold.
Because Property Invest started acquiring properties in December 2019, all are still within the three-year guarantee window. What happens to their investment — and, more pressing for Baltimore residents — the properties when the window closes?
One Turkish investor, Ebru Fergan, sent laughing emojis in response to a picture of the condition of their West Baltimore property, one block south of Grace Medical Center, and is boarded up in the front and rear. Despite the current state of the home, he said, he was receiving his promised rent payments.
Others expressed concern. “We made an agreement with Property Invest USA, that they will manage all the needs of that property to make it in a good condition to rent. … They gave me a guarantee that for one or two years, they will keep it in good condition,” said Ercin Baykal, who said he is receiving his rent income.
“For sure, when you purchase a house it should be in a good condition. $100,000 is not a small amount of money.”
Mete Kagan Ozel bought his home on East Federal Street in August 2020. Records show he paid $80,000; it is assessed at $12,000, and Property Invest paid $27,000 to acquire it.
Ozel said he knew what he had bought into.
“We know that this is an area where Black people are living and the houses are not so good. There are some houses around mine that are selling for $10,000 or $15,000.”
The home is listed by the city as vacant and has chest-high weeds growing next to its marble steps.
Ozel said he had been receiving rental income into a Chase Bank account controlled by Bayırlı and shared with other investors. Each investor had their own company bank card for the account. But two months ago that account was closed, and Bayırlı has advised investors to come to Miami and open their own accounts. Ozel tried to open an account while in San Francisco recently, but was unable to do so without providing U.S. utility bills.
Others had been able to open accounts in Miami, Ozel said, adding: “It is not a problem — I will be able to sort it.”
Hannah Lucinda Smith is a freelance journalist based in Istanbul.
Illustrations by Adam T. Jones for The Baltimore Banner.