Wed, Dec 20, 2006 page9

• Londongrad: a home for rich Russians at play

  London has always been a place where the super-rich and idle from around the world could gather, but today's uber-rich expatriates of note are making big waves

  • By Alan Cowell / NY TIMES NEWS SERVICE
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  To those fearful of homegrown Muslim extremism, this city was Londonistan. But now, after the mysterious poisoning death of the former KGB agent Alexander Litvinenko, other sobriquets are more current: Londongrad, Moscow-on-the-Thames.

  The new names reflect the changes wrought here by a complicated influx from beyond the Urals, one that has built with ever greater pace since the Cold War.

  By several accounts, London is now home to an estimated 300,000 citizens from the former Soviet Union, a third of them arriving in the last two years. Among them and around them twist hazy connections linking spies and former spies, conspirators, ex-dissidents, rich businessmen -- and a few of those from the transcendent class of wealth known in Russia as oligarchs.

  WEALTHY OUTSIDERS

  There is a long tradition of wealthy outsiders gathering here to disport themselves in restaurants and nightclubs, gambling dens and other places: Arabs in the 1970s, Japanese in the 1980s, Americans sporadically for decades.

  But since the economic free-for-all of post-Soviet Russia in the 1990s spawned both a superrich class and vast networks of organized crime -- followed by a crackdown by Russian President Vladimir Putin -- the notoriety goes to rich Russians.

  While they might have to exercise some degree of discretion back home to avoid drawing Putin's ire, they spend freely in London. Some buy art, some party. Some buy homes in London for their families and commute to work in Russia each week; Moscow is just a three-and-a-half-hour flight away.

  "Germany is good for savers, London is for spenders," said Andrei Nekrasov, 48, a Russian filmmaker and friend of Litvinenko's who spent many years in London and now lives in Berlin.

  Russian business executives are drawn, in part, he said, by the "flexibility of anything to do with banks" in London.

  "A lot of them are upper middle class in Western terms," he said. "They can afford a US$2 million apartment in cash. That's the middle class by Russian standards -- and a Russian would come and bring the money in a plastic bag."

  HOMES SNAPPED UP

  Russians snapped up almost a quarter of the London homes sold for more than US$15 million in roughly the past year, said Liam Bailey, a real estate broker. Some estimates put the level of buying of fancy homes even higher. According to Gulnara Long, a property adviser, Russians buy about 60 percent of homes costing more than US$20 million.

  The influx has "changed property prices, it's changed restaurant bookings -- you hear a different language being spoken in restaurants now," said Geordie Greig, the editor of Tatler society magazine.

  Greig helped organize a white tie party last summer that Alexander Lebedev, a Russian businessman and critic of corruption, gave at Althorp, the ancestral home of Diana, Princess of Wales. The party was studded with celebrities like Elle Macpherson and Orlando Bloom; the meal was sumptuous, and entertainment was provided by, among other things, a classical pianist, the Black Eyed Peas and several pole dancers.

  FINANCIAL FREEDOM

  The Russian rich praise London's freedom in financial affairs and its tax code benefits for those who spend significant time outside Britain. Meanwhile, Russian dissidents and artists in exile praise it for its adherence to laws and its political freedoms.

  Akhmed Zakayev, whom the Kremlin calls a terrorist, is a former Shakespearean actor representing the ousted rebel government of Chechnya. He received asylum here three years ago, "thanks to the law of this country," he said in an interview.

  Oleg Gordievski, a high-ranking KGB spy who defected 21 years ago and who blames Russian authorities for the death of Litvinenko, said, "London is attractive because England is the freest country in Europe."

  Yekaterina Lebedeva, 37, a concert pianist who came here 12 years ago, agrees.

  "One thing that strikes me in London is that you feel there are opportunities and things you can achieve, a sense of artistic freedom," she said.

  As in any community, there are splits. Those in Londongrad may just be flashier.

  In June 2003, Roman Abramovich -- one of Russia's and England's richest people with a fortune estimated at almost US$19 billion -- bought the Chelsea soccer club for US$233 million, and some headline writers renamed it Chelski.

  He has since spent US$900 million to acquire players, and the club's payroll reportedly surpasses that of the New York Yankees.

  In the 1990s, Abramovich was a business associate of another Russian billionaire, Boris Berezovsky, who made his money with a car dealership and other ventures including oil, but the two have gone different ways. As if to underline that, Berezovsky maintains a box at Arsenal soccer club, Chelsea's rival.

  "There are Russians and Russians," said Alex Goldfarb, an associate of both Litvinenko's and Berezovsky's. "And the nonpolitical ones do not touch the political ones with a 10-foot pole."
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