Azerbaijan President Ilham Aliyev has spent billions on capturing the
world’s attention to the European Games in his Caspian seaside capital
of Baku. He has spared no expense, including slapping plastic facades on
tired buildings, building new roads and booking megastar Lady Gaga for
the Opening Ceremonies. The best hotels are booked solid.
In its two-week run, the first-ever competition played host to and
showcased 6,000 athletes and 3,000 officials and support staff from 50
While taxpayers ultimately foot the bill for this, two privileged
citizens have been massively enriched by the games: the president’s
That’s because they control an enormous chunk of the luxury hotel
business in Baku. Their hotels, sporting such well-known Western brands
as the Four Seasons, Sheraton and the Marriott, sit at key points in the
Reporters for the Organized Crime and Corruption Reporting Project
(OCCRP) found that Leyla and Arzu Aliyeva directly own or are closely
connected with six five-star hotels in Baku. One more hotel is under
construction. They also own two exclusive mountain resorts, and likely
have a role in a 10th hotel.
Reminiscent of the palaces of Arab princes, these hotels are known to
most Azerbaijanis only through TV. They’re so expensive it would cost
the average Azerbaijani a month’s salary to check in for a night or two.
As the games got underway, OCCRP checked on room availability. “Due to
(the) European Games, our hotel is fully occupied,” said the
receptionist at the Fairmont hotel, which stands like a gateway to Baku,
overlooking the waters of the Caspian. Follow up calls to all Baku
hotels connected to the daughters showed they too were booked solid
through the closing ceremony.
Other First Family-connected or owned hotels, in addition to the
Fairmont, are the JW Marriott Hotel Absheron Baku, a centerpiece of the
futuristic skyline of the city center; the Four Seasons, a
Beaux-Arts-style luxury hotel; and the Sheraton at Baku International
Airport. The daughters also have holdings in Intourist, a boutique hotel
described as the cradle of sophistication overlooking the waterfront
boulevard; the Boulevard, the largest conference hotel on the Caspian;
and two mountain resorts, the Pik Palace Shahdagh and the Park Chalet
Shahdagh, surrounded by stunning mountain views of the Shahdagh,
Azerbaijan’s most famous mountain. Another hotel under construction –
the Dinamo – is described as a “heritage boutique” in the heart of Baku.
It will open in 2016.
A 10th, the Jumeirah Bilgah Beach Hotel, one of Baku’s most exclusive
resorts, is connected to the daughters through related companies.
The nine working hotels are among the largest, best-situated and most
popular hotels in Azerbaijan. According to a 2014
statement by the State Statistics
Committee, Azerbaijan has 30 five-star hotels. Other major hotels in
Baku are owned by business partners of the Aliyevs or government
Six five-star resort hotels are owned by Ashaf Kamilov, chairman of the
supervisory board of a conglomerate the First Family owns and a former
tax ministry official. He is also a business partner owning one third of
the family-owned ATA Bank. The Emergency Minister, owns six hotels.
The name-brand hotels all are less than 4 years old. The Four Seasons
opened in 2012 just before the FIFA Under-17 Women’s World Cup in Baku;
and the Marriott just before the Eurovision song contest in 2012.
Intourist and Boulevard were opened just in time for the European Games.
Prices for standard rooms in the family’s hotels start at an average 300
AZN (US$ 286). Some rooms cost as much as 1,500 AZN (US$ 1,430) per
night. In contrast, the average monthly salary for most Azerbaijanis is
452 AZN (US$ 430). The First Family has 2,400 rooms and suites under
its control. If they are fully booked during the European Games, the
hotels could be bringing in more than US$ 10 million.
Ilham Aliyev attended the opening of the “Fairmont Baku Hotel” at the Flame Towers complex. (Photo by president.az)
Hotel Assets Worth US$ 10 Billion
An Azerbaijani real-estate expert who asked not to be named out of fear
of retribution said that the high-end Baku hotels owned or closely
connected to the family are valued at US$ 10 billion.
The Aliyevs came to own this profitable block of business through a web
of intricate and hidden deals.
The Four Seasons and Marriot are held in the name of Pasha Holding,
which was established in 2006 with investments in banking, insurance,
construction, property development and tourism. Five more hotels –
Intourist, Boulevard, the mountain resorts Pik Palace Shahdagh and the
Park Chalet Shahdagh, and Dinamo (under construction) are owned in the
name of Absheron Group,
a subsidiary of Pasha Holding.
Silkway Holding owns the Sheraton. A 2010 investigation by Radio Free
Europe / Radio Liberty (RFERL) where Ismayilova worked showed that
Silkway is owned by the president’s younger daughter, Arzu Aliyeva, and
Zarifa Hamzayeva, the wife of the president of Azerbaijan’s AZAL state
The Fairmont is owned by Azinko Development, and Jumeirah is owned by
Azinko Holding Company, both of which are real-estate construction
It is impossible to identify the true owners of the two Azinkos due to
legislation adopted in 2012 that made information about the founders of
companies a commercial secret. This legislation was passed after
Ismayilova’s reporting began revealing who owned Azerbaijani companies.
However, the family is linked to Azinko Development through their
Gozel, the general
director of Azinko.
According to leaked documents obtained by the International Consortium
of Investigative Journalists, Gozel is director of Arzu Aliyeva’s
company, Arbor Investments
Limited, and Leyla
Aliyeva’s Harvard Management Limited, which are both registered in
British Virgin Islands. Others who have had similar positions in
companies owned by the Aliyev family have been proxies acting on behalf
of the family.
The similarly titled Azinko Holding Company is a Baku-based construction
company. No names are associated with the company, but it follows the
same pattern as Azinko Development. It was registered at the same time
as Azinko and neither company show up at the registry at the Ministry of
Taxes as is required by law.
Controversy has accompanied the construction of at least five of the family-owned hotels.
The Four Seasons was built in a historic section of the capital despite
the objections of architects worried about damage to the nation’s
heritage. It was built on land taken from homeowners never paid fully
for their losses. The hotel opened in September 2012, a few days before
the FIFA U-17 Women’s World Cup. The first clients were international
music stars Shakira and Rhianna.
The Marriott on Freedom Square – the place where Azerbaijanis gathered
in the millions in the late 1980s to demand independence from the Soviet
Union – used to belong to the Trade Union. It was secretly sold in 2006
to the Aliyevs’ Pasha Holding. Who bought the hotel, and for how much,
has not previously been publicly disclosed. Hafiz Babali, a reporter for
the Turan Information agency who at the time attempted to investigate
the sale, said that the Trade Union told him it sold the hotel at a
reduced price due to the union’s poor financial condition.
“At that time, nobody knew to whom and why for such a low price the hotel was sold. But now years later, we finally have an answer to the question of whom the hotel belongs to,” said Babali.
The Marriott opened just before the first notes of the Eurovision
The same scenario played out with the Fairmont, known as the Moscow
Hotel when the government owned it. In 2006 it was sold for 1 million
AZN (US$ 1 million) to the family-connected Azinko, which was much less
than it was worth, according to the Turan agency. It was demolished and
replaced by the Flame Towers, now being marketed as the symbol of Baku.
Finally, the, Pik Palace Shahdagh and the Park Chalet Shahdagh were
built on farmland where the people of Aladash and Quzan villages kept
livestock. They were paid a pittance: 24 AZN (US$ 23) per plot. Eighty
of them complained in court, but all their claims were rejected.
Their lawyer Anar Qasimli told RFERL he gave the court recent sales
contracts which showed that similar real estate sold for between 1,000
and 2,000 AZN.
Gorkhmaz Asgarov, vice president of Azerbaijani-Americans for Democracy
(AZAD), a non-governmental organization founded by Azerbaijanis living
in the US, says that Aliyev runs Azerbaijan like his personal property.
“He has even inherited the presidency from his father. If we dig
deeper we will see that Azerbaijan has tasted democracy for a very short
period of time and its democracy ended with failure. Therefore, in
Azerbaijan, society is sort of used to its property being robbed,” said Asgarov.
“Not so long ago in history, in Soviet times everybody knew that sturgeon and caviar in reality didn’t belong to (the Azerbaijani people). It is the same situation now. Before, the Soviet/Russian Empire plundered these resources via its chiefs on the ground, and now Ilham Aliyev is doing the same thing.”
The recent games are not the only events promising to help again fill
the First Family hotels. Upcoming events include:
The Baku European Grand Prix 2016 will race Formula 1 cars racing
through the streets of Baku.
The Islamic Solidarity Games in 2017 will bring athletes from more
than 50 countries to Baku.
The UEFA European Championships 2020 will be played at the Olympic
Stadium for three group stage football matches and a quarter-final
“Ordinary Azerbaijani people don’t need any international games like
(the) European Games, World Cup. … Why do people need it? People want
work; people want education; people want legal civil society,” said
Zardusht Alizade, a political expert on Azerbaijan. “Our people can’t
cover their daily expenses.”