US embassy cable - 05ISTANBUL346

UNCLAS SECTION 01 OF 02 ISTANBUL 000346 
 
SIPDIS 
 
SENSITIVE 
 
TREASURY FOR INTERNATIONAL AFFAIRS - RADKINS AND MMILLS 
DEPARTMENT PLEASE PASS OPIC FOR BBOEHM 
NSC FOR BRYZA AND MCKIBBEN 
 
E.O. 12958: N/A 
TAGS: ECON, EINV, TU, OPIC, Istanbul 
SUBJECT: SUZER PLAZA CONTROVERSY CONTINUES 
 
 
 Sensitive but unclassified.  Not for internet distribution. 
This message was coordinated with Embassy Ankara. 
 
1. (SBU) Summary: Istanbul's controversial Suzer Plaza 
skyscraper, which houses the Ritz Carlton Hotel and was 
partially financed by OPIC, has returned to the headlines in 
recent weeks.  In early January, two restaurants at the 
building's base were targeted for partial demolition by city 
officials for lack of a proper building permit.  In a stealth 
operation, a city demolition team accompanied by hundreds of 
policemen descended on the property without warning to 
enforce the judgment, as startled hotel guests watched and 
listened from the floors above.  Then in late February, 
Istanbul Technical University, which owns adjoining property, 
filed suit to force demolition of the entire structure, 
basing its case on a recent decision by the Danistay 
(Turkey's final court for administrative decisions) that 
zoning permission for the property was improperly granted in 
the 1980s.  Suzer Group officials ascribe the restaurant 
operation to "political hostility" to the building from high 
levels of the GOT and Istanbul municipality, pointing out 
that Mayor Kadir Topbas has recently suggested on Turkish 
television that Mustafa Suzer should tear down the building's 
top six floors.  They dismiss the ITU suit as a minor 
"nuisance" designed to curry favor with building opponents, 
and predict it will fail.  In the meantime, we have rebuffed 
Suzer Group requests that the USG weigh in with local 
officials on the building's behalf, suggesting instead that 
the group continue to use legal avenues to defend itself. 
End Summary. 
 
2. (SBU) Municipality Message: The controversial (infamous in 
the view of many if not most Istanbullus) Suzer Plaza 
building returned both to the front pages of Istanbul 
newspapers and to Turkish courts in recent weeks.  Last in 
the news late last year, when Prime Minister Recip Erdogan, 
who as Istanbul Mayor in the 1990s fought unsuccessfully to 
prevent its construction, pointedly refused to attend a 
Capital Markets Board Meeting in the Ritz Carlton Hotel, the 
building was also subsequently targeted by current mayor 
Kadir Topbas, who told a television interviewer that he would 
like to ask owner Mustafa Suzer to "tear the building's top 
six floors down."  Subsequently, on January 7, a city 
demolitions team accompanied by hundreds of policemen 
descended on two restaurants at the building's lower level 
entrance (which is separate from the Ritz Carlton Hotel 
several floors above).  As surprised guests watched and 
listened from the hotel, they demolished the restaurants' 
winter gardens, which they indicated had not been properly 
licensed.  (Note: Physically the winter gardens were not part 
of the original fabric of the building, but were later 
ground-level additions to give these restaurants "open-air" 
premises.)  In meetings with us held at their request, Suzer 
Group officials, including Suzer's son Serhan Suzer, 
challenged the municipality's legal case and argued that the 
action had been taken not just without warning, but in 
violation of a court injunction that one restaurant owner 
secured while his workers briefly held the demolition crew at 
bay. 
 
3. (SBU) A Broader Threat?  Suzer, who was accompanied by 
Ritz Carlton manager Allan Federer, expressed concern that 
the municipality would subsequently turn its attention to the 
building as a whole and attempt to enforce the Mayor's dictum 
that its height be reduced.  He ascribed the municipality's 
actions to pressure from Ankara, noting that his family had 
previously enjoyed warm relations with Topbas, and asked that 
the USG intervene with appropriate decisionmakers, given both 
the presence in the building of the Ritz Carlton and the 55 
million USD in OPIC financing that enabled the building to be 
built.  In a subsequent (and unrelated) meeting with the 
Consul General, City Planning Chief Tankut Gundogar commented 
briefly on the Suzer case, noting that the restaurants were 
in violation of the law, and that there are "broader issues 
with the building."  He stressed that these would be worked 
out in a cooperative fashion, however, and suggested that the 
Suzers had sought an international hotel as tenant in order 
to act as a buffer against any possible legal action against 
them. 
 
4. (SBU) ITU Case: The furor surrounding the restaurant raid 
has quieted in recent weeks--indeed, in a surprising twist, 
we understand that a permit that will enable one restaurant 
to rebuild its winter garden may soon be approved--but a new 
front flared up in late February when Istanbul Technical 
University (ITU), a long-embittered building neighbor, filed 
suit to force its demolition.  The case, which Suzer 
officials describe as a "nuisance," results from a recent 
Danistay decision that determined that Turkish officials had 
erred in 1984 when they removed from the site's deed a 
19th-century edict by Sultan Abdulhamid prohibiting any 
construction upon it.  The Danistay ruled that such an action 
could only be taken by court decision, rather than 
administrative fiat.  Suzer officials characterize the case 
as meaningless, as their administrative procedure is legally 
defensible, and in any case can be remedied simply by 
recourse to the relevant court.  They ascribe the case to the 
university's desire to curry favor with the building's 
powerful opponents. 
 
5. (SBU) Comment: Consulate has kept OPIC informed of the 
recent developments, and remains in consultation with it and 
Embassy Ankara regarding the Suzer Group's request for USG 
advocacy.  Our view is that this is now a dispute between 
Turkish entities and that it is not appropriate for the USG 
to become involved.  If and when it appears that the Ritz 
Carlton is being targeted because it is an American company, 
then it would be appropriate to act, but we are far from that 
point, and as Tankut Gundogar indicated, it is more likely 
that the Ritz's presence has spared the building from more 
intense pressure.  Given the long and tortured history of the 
building, we thus strongly recommend that the USG not take a 
role.  A packet of information provided to P/E Chief by 
Serhan Suzer characterized the building as a "pillar of law," 
given the fact that it has emerged victorious from every case 
filed against it.  Perhaps the most telling fact, however, is 
the number of suits involved-- 43 at that point, but now 44 
and counting.  End Comment. 
ARNETT