Billionaire real estate mogul Donald Trump is facing litigation from a group of 30 buyers who allege he misrepresented his stake in a $220 million luxury condominium project in downtown Tampa that failed after the development partners went into bankruptcy.
In a state lawsuit filed Tuesday in Hillsborough County, Fla., the buyers allege that in 2005, Trump presented himself as an active investor in the 190-unit Trump Tower Tampa, while hiding a confidential million dollar licensing deal, in which Trump would earn a $4 million fee, plus 50 percent of future net earnings by Tampa-based SimDag/Robel, the lead development firm.
“They were specifically targeted by Trump’s promotional [team] that Trump was building the tower,” said Daniel Clark, an attorney with Clark & Martino, one of two firms representing the buyers.
After Trump repeatedly stated that he had a stake in the project, the licensing deal was disclosed in a 2007 media report.
The buyers were told the project would be done by December 2008; however, SimDag filed for Chapter 11 bankruptcy protection in June 2008 after the Florida real estate market collapsed and it fell behind on millions of dollars in contractor fees and other payments. The Trump Tower site was later sold off to new owners in an auction.
Trump officials denied the allegations.
“The allegations are without merit. Mr. Trump was not the developer of the project, did not enter into contracts with any of the buyers and did not receive deposits from any of the buyers,” said Alan Garten, assistant general counsel at the Trump Organization.
“Mr. Trump licensed the use of his name to the developer, Simdag/Robel LLC, to brand the project — no different than any other luxury real estate brand. This was clearly disclosed to the buyers in both the purchase contracts they signed and the property reports they received, each of which expressly identified Simdag/Robel LLC as the project’s developer and seller of the units.”