Trump Org’s office holdings help offset hotel losses: analysis
Trump holds minority stake in two Vornado properties in NY, SF
Since President Donald Trump took office, the Trump Organization has seen revenue at its hotels suffer due to association with his name. But those struggles have largely been offset by a less prominent side of the company’s business, according to an analysis by the New York Times.
Commercial properties account for 30 percent of the organization’s revenues, according to the president’s financial disclosure statements. Hotels make up 25 percent of the total while golf courses and clubs contribute another 30 percent.
“Our office buildings are killing it,” Eric Trump told the Times. “It is under appreciated.”
The organization has a 30 percent stake in two Vornado Realty Trust properties — 1290 Sixth Avenue in Manhattan and 555 California Street in San Francisco. Those interests bring in tens of millions of dollars for the Trump family each year, and have been highlighted as a potential conflict of interest as Vornado seeks government contracts and federal funding for projects.
While those properties lack a visible association with the Trump brand, with many office workers apparently unaware of the building’s ownership, the Trump Building at 40 Wall Street has also thrived financially, with its net operating income nearly doubling since 2015 according to Trepp data reviewed by the Times.
Former Trump Organization attorney Michael Cohen testified in February that Trump inflated the value of 40 Wall Street when seeking financing for the property. The ground under the building is in fact owned by an obscure German aristocratic family, the Hinnebergs.
Meanwhile, Trump’s hotels have suffered not only from declining occupancy, but also high-profile political controversy.
At the Trump National Doral in Miami, where the president once proposed hosting next year’s G7 summit, net operating income declined by 69 percent between 2015 and 2017. A tax consultant for the Trumps told Miami-Dade County officials that the property was “severely underperforming” other resorts in the area.
In Washington D.C., the organization has hired JLL to market the Trump International Hotel, which has attracted criticism for years as the president continues to profit from what has become a prominent gathering-place for lobbyists and foreign officials. [NYT] — Kevin Sun