Trump’s Shambolic Empire faces great chances of yet another comeback

Photographer: Ted Thai / The LIFE Picture Collection / Getty Images

On the day that Donald Trump was being accused of impeachment in Washington, the lobby of his tower in New York at 40 Wall St. was almost silent. Few steps stained the shiny marble.

But in the dark and golden elevators, problems were arising in one of the billionaire’s most valuable properties. Inside a law firm, two partners clashed over whether to continue paying rent to a landlord who encouraged the deadly Capitol rebellion. On the 24th floor, a nonprofit organization that fights tuberculosis was exploring options for going out. On the seventh day, the Girl Scouts were figuring out how to terminate the lease.

And in the basement, vintage bank vault doors that weighed more than 10 tons were open. There, in a club room refurbished by Trump, the news was playing on a jumbo television for an audience of empty seats at the time Congress was voting against him.

That’s what happens in Trump’s empire as his presidency draws to a close.

The Trump Organization, headed by sons Eric and Don Jr., was struggling with the devastating consequences of the Covid-19 pandemic even before his father incited an attack on Congress. Efforts to sell his hotel in Washington were shelved, his office buildings were losing value amid the excess space in Manhattan and his golf courses were facing the reality that the younger generations are not so interested.

Trump took office with a value of $ 3 billion. Despite the rise in stock prices and his own tax cuts, he will leave about $ 500 million poorer, according to the Bloomberg Billionaires Index.

Its buildings are overburdened with more than $ 1 billion in debt, most of which are due in the next three years and more than a third are personally guaranteed. Refinancing would mean finding creditors and corporations willing to work with the impeachmented former president only twice.

“Nothing like this has ever happened to him,” said Barbara Res, who has been an executive at Trump’s company for years. “He will come back? My instinct tells me yes, because he always comes back. But he will not return the same. “

Avenida Deserta

Trump has survived corporate bankruptcies, tough times in Atlantic City, a school that ended with polls and dead-end brand journeys for Trump Steaks, Trump Vodka and even an airline. The man who made “America First” his catchphrase could now hunt abroad in search of partnerships and licensing agreements.

Even so, Deutsche Bank AG, his longtime financier, will no longer touch him. The signature bank, where her daughter Ivanka once worked on the board, is closing her accounts. Cushman & Wakefield Plc, a broker for 40 Wall St., is severing ties, and PGA of America is moving away.

The biggest hits for Trump’s fortune are in New York, the heart of his empire, where the Queens-born developer became a reality star and then went down his own escalator to get into politics.

Outside Trump Tower, East 56th Street remains blocked off, a parking lot for about a dozen black SUVs with government license plates. The building is closed to visitors due to the pandemic, closing Trump’s steakhouse, bar, cafe and ice cream parlor.

Not that there are tourists to take winter sundaes. Fifth Avenue is almost deserted. Empty storefronts are multiplying, and some of the remaining boutiques are now by appointment only. Rents fell 32% from the 2018 peak, according to the Real Estate Board of New York.

Trump’s cavernous space on East 57th Street is currently sub-leased to iconic Tiffany’s jewelry, but a new tenant will be needed soon.

High above, 1,596 square feet of Trumpian extravaganza are getting cheaper and cheaper.

Apartment 55B, with blue lapis lazuli floors and medallion ceilings, it is listed for $ 2.995 million, about $ 2.5 million less than four years ago. It is hardly an outlier. Skyscraper prices have dropped by a third since Trump took office, StreetEasy data show.

And even before the attack on Capitol, his company was offering concessions to some tenants at 40 Wall St., creditors’ records show. The $ 137 million debt on the property was added to creditors’ watchlists in November after net income fell below what subscribers had expected when the debt was issued in 2015.

City rejection

“I don’t think his name will win an award today,” said Warren A. Estis, founding partner of the law firm Rosenberg & Estis and owner of an 86th floor penthouse at Trump World Tower, near the United Nations. Still, Estis said he did not hear murmurs from the condo board about the removal of Trump’s name from the building.

“What’s in a name? A rose by any other name is still a rose,” says Estis. “It looks like Donald is very resilient and I hope he will recover from that.”

New York City itself wants nothing to do with Trump. Authorities plan to close more than $ 17 million in contracts with the president’s family business, including a carousel and two ice skating rinks in Central Park and a golf course in the Bronx.

“New York City has no legal right to terminate our contracts and, if it decides to proceed, it owes the Trump Organization more than $ 30 million,” the company said in a statement. “This is nothing more than political discrimination, an attempt to violate the First Amendment, and we plan to fight vigorously.”

While police kept the public away from the Trump Tower, including its Trump Store, there was also bad news for fans who went online to pick up Trump beer glasses for $ 55 or a Trump candle for $ 80. Shopify refuses to serve the site, which left customers with a warning that their connection is not private and that “attackers may be trying to steal your information”.

Not long ago, the big question hanging over Trump’s return to the business world was whether the former reality show host would make a foray into conservative media, where product endorsements and licensing deals are legion. Now, the conversation in financial circles revolves around whether he can defend his existing empire. He will have to convince creditors that it is worth the risk and prove to developers that his name maintains enough cache.

“Donald’s racist, sexist and xenophobic presidency and language have tarnished the brand to such an extent that it has no value,” said Michael Cohen, his lawyer who became a critic.

Streaming Trump

Eric Trump dismissed such claims in a an interview with the Associated Press this week, blaming “canceling culture” for the recent attacks on the family empire, which he said did not pose a threat to the company’s finances. His father, he noticed, still has armies of fans: “You have a man who would be followed to the ends of the earth by a hundred million Americans”.

A conservative media executive who is still optimistic about Trump’s prospects of creating a subscription video service has admitted that recent events may limit potential platforms, advertisers and partners.

Still, the executive said that even controversial pornography providers can find homes online. He estimated that Trump could get 5 to 15 million supporters to pay $ 10 a month for the content, predicting that gold sellers and close friends would not refuse to advertise.

The Trump Organization can also look abroad.