Tuesday July 29, 2025
A side-by-side comparison of the undeveloped 37-acre parcel in Lakeville, Minnesota (top), and Nolosha Development’s promotional rendering (bottom) depicting a Somali-focused suburban community with single-family homes, a mosque, and commercial amenities. Despite collecting over $1 million in deposits, the project never broke ground and is now the subject of a fraud ruling and federal forfeiture proceedings. Top image – Credit: Dymanh Chhoun | Sahan Journal / Bottom image – NoloshaDevelopment.com
MINNEAPOLIS, Minnesota (HOL) — A Minnesota judge has ordered Nolosha Development and its CEO, Abdiwali Abdullahi, to repay Somali-American families who paid tens of thousands of dollars in deposits for homes that were never built in a Lakeville housing project that failed to secure land, permits, or financing.
The ruling, issued this week by Judge Christian Sande in Dakota County, follows a default judgment in a civil fraud lawsuit brought by Minnesota Attorney General Keith Ellison. The case emerged after whistleblowers in 2023 alerted authorities to concerns about fraudulent conduct. The court found the company in violation of several state laws, including the Prevention of Consumer Fraud Act and the False Statement in Advertising Act, after repeated failures to comply with court orders and hand over key documents.
A separate hearing will determine the amount owed. According to Ellison’s office, at least 160 customers, many of them Somali immigrants, paid deposits of up to $25,000 each. Collectively, Nolosha collected over $1 million.
The project was marketed as the first Somali-focused housing development in Minnesota, with promises of lakefront homes, halal markets, a mosque, an Islamic school, and no-interest 20-year mortgage plans. Promotional events hosted by Nolosha in 2022 featured renderings of a utopian suburban enclave.
But according to affidavits, investigative reports, and city records, Nolosha never owned the 37-acre Lakeville parcel, never obtained permits, and never broke ground. A purchase agreement for the land was cancelled in December 2024 after multiple missed deadlines. The property is currently subject to federal forfeiture after being linked to the $250 million Feeding Our Future fraud case.
“As a Muslim, it is not OK to buy something that is stolen,” wrote Abdulkarim Mohamud in a sworn affidavit filed with the Minnesota Attorney General’s Office. “So the fact that the land was involved with Feeding Our Future money was worse than buying land with interest.”
Lakeville Planning Manager Kris Jenson confirmed in a court affidavit that the city had not received any formal development applications from Nolosha. She added that “both the topography and the significant wetlands on site present challenges for the use of the site.”
Multiple families said they were misled about Nolosha’s progress and terms. In sworn affidavits, Abdulkarim Mohamud and his cousin Siraji Noor said they were promised matched deposits, five-bedroom single-family homes, and completion by November 2023. After months of delays, bounced refund checks, and unreturned calls, the men joined other clients in legal action.
“What was supposed to be an amazing gift for our son has turned into a nightmare,” wrote Abdulkarim Mohamud in an affidavit filed with the Minnesota Attorney General’s Office.
The Attorney General’s Office filed its lawsuit in October 2024 after receiving multiple complaints and accused Nolosha of misrepresenting essential facts, including false claims about home types, financing models, and community amenities.
“If you are selling a product, you need to be honest with your customers about what that product is,” Ellison said in an October 5, 2024, press release. “Promising your customers the world, taking massive upfront payments from them, then failing to deliver on those promises is fraud, plain and simple.”
At an April 2025 court hearing, Abdullahi acknowledged that Nolosha could no longer afford legal representation. He attributed the company’s collapse to negative publicity and the attorney general’s investigation, which he said frightened clients into backing out.
He claimed to be “working on a solution,” including forming a “special purpose vehicle” with community members to raise funds for legal counsel. However, by the time of the final hearing, the company remained unrepresented and noncompliant.
“Obviously, I’m not going to grant a continuance,” Judge Sande told Abdullahi at the hearing. “This has just gotten preposterous, frankly.”
During a separate hearing in January, Sande warned Abdullahi directly:
“It’s time for you to take this matter seriously,” Sande said. “Mr. Abdullahi, this just isn’t going to work.”
The Lakeville development had been pitched as a model for Somali-led, faith-compliant homeownership. Many families were drawn in by the promise of halal financing, avoiding interest payments, which are forbidden in Islam, and the vision of a self-contained community led by people from their own background.
But while Nolosha continued to collect payments and maintain a waitlist of over 1,500 hopeful applicants, the project never moved beyond PowerPoint slides and promotional videos.
Court records show that Nolosha issued partial refunds to some buyers, but often deducted thousands in penalties—despite having failed to deliver any housing. The company remains under investigation by the FBI in addition to the ongoing civil case.
The Attorney General’s Office said it would continue to pursue full restitution.