Another barrier has fallen in Donald Trump’s road to unload his Washington, D.C. hotel.
The General Services Administration approved the $375 million sale of the Trump International Hotel lease to CGI Merchant Group, the Washington Post reported. The agency reviewed CGI’s agreement with Hilton Worldwide, as well as the company’s finances and ability to nab bank financing.
Some congressional Democrats called on the GSA to investigate the Trump Organization’s management of the property or even void its lease, according to the Post. But the agency was only required to perform a limited review of a potential sale, according to the terms of Trump’s lease.
The sale is expected to close in the coming weeks, the Post reported.
In November, Miami-based investment firm CGI reportedly entered into contract to buy the hotel lease. Under new ownership, the hotel is expected to drop the Trump name in favor of having it managed and branded by Hilton’s Waldorf Astoria group.
The property has a controversial history, dating back to when the Trump Organization won approval to redevelop the site in 2012. The company leased the property from the GSA, agreeing to spend an estimated $200 million on renovations.
Trump resigned from his companies upon becoming president, but put the assets in a trust to be run by his sons that allow him to benefit financially. The hotel’s opening in 2016 created concerns about people utilizing the hotel to curry favor with the president’s administration.
Trump reported in financial disclosures the hotel generated more than $150 million in revenue, but documents from the House Oversight Committee peg losses of more than $70 million at the hotel during the Trump presidency. The disclosures showed the property needed a loan of more than $27 million from a Trump holding company, as well as a $170 million loan from Deutsche Bank.
If the sale closes at its reported price, Trump could make a profit of more than $100 million. Trump owes Deutsche Bank on the project and also needs to pay a fee to the GSA, but his profit would remain significant.
Former baseball star Alex Rodriguez has emerged as a key part of the group aiming to buy the hotel, The Associated Press reported last month. The GSA named the pending transferee as the Hospitality Opportunity Fund, a $650 million investment vehicle established by Rodriguez, CGI and Adi Chugh.
[WaPo] — Holden Walter-Warner