UPDATE: June 6, 5:10 p.m.: Standing in the marble lobby of Trump Tower in October 2012, Donald Trump launched his new brokerage with characteristic bombast.
“I don’t think with the people we’ve assembled that anyone can compete with what we’re doing,” he said of Trump International Realty. The firm was to work on luxury sales and listings all over the city, and with the Trump pedigree, a long track record of condominium development, a rising property market, and a head start with the Trump Organization’s own buildings, its prospects appeared rosy. “Everyone involved is going to make money,” he said.
But nearly four years later, the highest-profile New York City real estate venture that Trump has launched without outside partners is, by three measurable metrics — listings, professional retention and expansion — struggling in his hometown. The brokerage’s storyline runs counter to the narrative that Trump, as he prepares to become the Republican Party’s presidential nominee, likes to project: A lifetime of unqualified success in business and real estate.
Since it began, Trump International Realty’s top management has turned over almost every year and just three agents from an original team of at least 15 remain. Even as the firm grew nationally — it has at least 40 agents in seven offices, according to a Trump spokesperson — its New York office has shrunk to just seven agents. And locally at least, the firm’s goal of doing business outside Trump’s properties also remains unfulfilled.
A spokesperson for the Trump Organization maintained the brokerage was on solid ground.
“We have continued to enjoy tremendous success in New York City, where Mr. Trump’s real estate empire began,” the spokesperson said, of the brokerage, which is 55 percent owned by Donald Trump and 45 percent by Trump family members, according to the candidates federal ethics filing, disclosed as part of his run for president. “We continue to expand strategically into additional markets and hire fantastic new talent,” she added, and pointed to the Trump Organization’s success with endeavors such as Trump Hotels and its golf course business.
In and out
The firm was helmed at the outset by Related Companies alumnus Kathy Kaye and by Kevin Sneddon, a finance and real estate executive. At the launch party Sneddon jokingly quoted Trump’s take on his new position: “‘You just landed the best job in real estate. Do a great job, or you’ll be fired.’”
But that state of affairs didn’t last long. By February 2013, Sneddon was gone, and Kaye followed suit a year later. Bill Cunningham, hired in May 2014 from the Corcoran Group to be president of Trump International Realty, lasted less than a year and returned to Corcoran in early 2015. Today, the firm is led by Naomi Muramatsu, who joined in August after spending six years at Bond New York.
“This is a very exciting time for Trump International Realty with a 28% increase [nationally] in year-over-year closed sales. Many of our customers choose to work with us because they trust the Trump brand,” Muramatsu said in a statement. She added that the overall number of agents at the firm had increased 19 percent over the last 6 months. A spokesperson for the Trump Organization added that “our model for Trump International Realty was always to look for other areas to expand into as evidenced by our growth in cities such as Miami and Charlotte.” In Miami, the firm has 17 agents, according to its website.
In New York, it wasn’t only top executives that departed. TRD reviewed historical versions of Trump International Realty’s website using Internet Archive and LinkedIn and found that of at least 24 agents and brokers who worked at the firm since it was launched, 17 have left.
Two of the agents who have stayed on, Susan James and Michael Weiner, have the bulk of the 10 active listings totaling nearly $38 million the firm held as of June 2, according to a review of On-Line Residential, an industry listings database.
One source noted that the real estate industry is infamous for turnover — in New York, poaching top talent is something of a sport — and that in most brokerages, just a few agents generate the vast majority of the business. It’s known informally as the 80/20 rule, meaning that 80 percent of the business is made by 20 percent of the agents. And many of the city’s other prominent brokerages also rely on a handful of agents for the lion’s share of their business, as TRD reported.
Trump vs. Trump
Even as the firm has struggled with retention, it has not been able to gain a solid book of business outside of Trump buildings.
At the launch of the firm, Sneddon said, “Trump International Realty demonstrates a clear competitive advantage in marketing and selling luxurious properties in both Trump buildings and beyond.”
But $33 million of the $38 million in the brokerage’s total listings is at Trump buildings, OLR data show, indicating little success in broadening the firm’s scope outside the developer’s own projects.
The main trouble in New York, according to a number of former agents contacted by The Real Deal who agreed to speak under condition of anonymity, was ironically the power of the Trump brand itself, and the firm’s inability to carve out its own identity.
The challenge, several of them said, was the public’s idea of what Trump is: a developer and property manager. Other developers, the sources said, did not want that Trump brand competing with their own brand on the side of their new apartment towers.
“Trump is such a well-known name that developers did not want to wrap their buildings with ‘Trump,’” said one former agent. “It’s confusing to buyers to see Trump’s name on another developer’s building.”
The same issue came into play when agents tried to win resale listings from sellers, they said.
“The biggest problem with Trump is it’s such a huge brand name that everyone associates with development, construction and management. It overshadowed the brokerage,” another former agent said, requiring a “pre-pitch” just to explain that Trump International Realty was only in the business of brokerage.
“They never necessarily branded or marketed the company as a full-service brokerage agency,” the agent added.
And even with the inside track at buildings owned or operated by the Trump Organization, Trump International Realty’s agents often haven’t landed the prime listings.
Case in point: At Trump Tower, at 721 Fifth Avenue [the commercial portion uses an address of 725 Fifth Avenue], there are 17 apartments on the market as of June 2. But just one of those listings, the cheapest of the bunch, was held by a Trump International Realty agent. The agent at the building with the most listings, is Keller Williams NYC’s Rana Williams, who spent 19 years at the Trump Organization and helped establish Trump Sales and Leasing, a predecessor to Trump International Realty. Williams joined Keller Williams in 2012 and has consistently been the most active agent at Trump Tower.
At 1 Central Park West, also known as Trump International, Susan James, who’s been with the Trump Organization since at least the 1990s, has four current listings. But the four priciest listings at the property are held by agents from Douglas Elliman, Brown Harris Stevens and Sotheby’s International Realty.
Update: The article was updated to provide the percent that Donald Trump and his family members own of Trump International Realty.