Trump Organization selling the lease on DC hotel to a Miami group -- will be rebranded as a Waldorf-Astoria (lawyer, controversial)

[RMESMH]

They've been trying to sell the lease since 2019.

It hasn't been profitable for the Trump Organization, losing some $70 million since 2016.

https://www.msn.com/en-us/travel/new...?ocid=msedgntp

[Eyebee Teepee]

but it "sounds like" he's still making money on the deal. The MSM doesn't seem to dare discuss that.

Lease was $250K/month, and no mention of an upfront "purchase" (it was, after all just a lease of the building). So, the $70MM in losses since he was elected include all the lease payments.

He put ~$200 - 250MM in, plus $24MM it's reported. So, for $224MM-$275MM, he's getting $375MM.

so, about $100MM on $275MM max. That's not too bad.

[stone26]

Originally Posted by Eyebee Teepee

but it "sounds like" he's still making money on the deal. The MSM doesn't seem to dare discuss that.

Lease was $250K/month, and no mention of an upfront "purchase" (it was, after all just a lease of the building). So, the $70MM in losses since he was elected include all the lease payments.

He put ~$200 - 250MM in, plus $24MM it's reported. So, for $224MM-$275MM, he's getting $375MM.

so, about $100MM on $275MM max. That's not too bad.

I don't think the math is as simple as that, but I do think he still comes out on top. Good for him.

[legalsea]

Mr. Trump had claimed to have made some 10s of millions of dollars, which I suspect is somewhat true. After all, you had foreign entities buying up literally floors of the hotel, then neglect to use the rooms. Plus, you had plenty of Republican groups using the hotel and its facilities, as well as individual supporters of Mr. Trump.



I will insert this, but do not vouch for its credibility:



"According to the Democratic-controlled committee, Trump reported that the hotel earned him more than $150 million during his time in office but actually lost more than $70 million.


The committee found that the hotel received over $3.7 million in payments from foreign governments - equal to more than 7,400 nights at the hotel, raising a potential conflict of interest."


https://www.reuters.com/world/us/tru...es-2021-10-08/


Of course, the first sentence is vague: did Mr. Trump report the 150 million, but also report losing 70 million?



As for the lease: it was much more complicated than reported herein. There was a base 'lease' price per year (or, as noted, $250K per month), but also contingency payments. Of course, Mr. Trump entered into the lease before he became President, so we must assume that it was a fair deal on both sides.



I suppose that the hotel is not being used much, now. If it still turned a profit, or even broke even, you would think that Mr. Trump would hold on to it, if he planned to run, and win, in 2024.



Since it is my viewpoint that he will not run, he is getting out.



As for the reported price: 375 million, each report claims that 'it is said' the deal was worth that much to Mr. Trump. See:



https://www.npr.org/2021/11/15/10558...ld-and-renamed


If the person behind the 'it is said' is Mr. Trump or other family member, I would take this with a grain of salt. We all know that Mr. Trump would never admit to losing money on a deal, even though he has, frequently

[middle-aged mom]

Occupancy was solid pre- pandemic as foreign governments, lobbies and staff booked in hopes of currying favor while Trump was in office.

[DRob4JC]

* shrug *

[legalsea]

Let us examine this more closely.



It was in August 2013 that Mr. Trump and the Government finalized the deal concerning the old post office in D.C.:



https://www.bizjournals.com/washingt...st-office.html


From the link:





"Trump plans to spend about $200 million to redevelop the 114-year-old site, with work slated to start in the first or second quarter of 2014.



The deal could be a prove to be a win-win-win for the federal government, D.C. and Trump, who hopes to command one of the priciest per-night room rates in D.C. The District will get a top-tier hotel along Pennsylvania Avenue in a part of town that does not typically draw much pedestrian traffic after business hours.


In exchange for a long-term lease on the property, Trump has agreed to pay a base rent of $250,000 a month for the next 60 years with additional rent if the hotel meets revenue targets."


Now, I invite any CD person with knowledge to correct me. I am an old lawyer, and real estate was never my field.



Mr. Trump agreed to pay $250K, per month, for the next 60 years. That is 3 million per year, or 180 million over 60 years.



The Trump Organization entered into this long-term lease with GSA.



The 'reports' say that Mr. Trump 'sold the lease' to CGI Merchant, for reportedly $375 million.



Yet, my lawyer side of me says: CGI Merchant does not have a 60 year agreement with GSA. The Trump Organization does.



So, to my thinking, the Trump Organization 'sold' the lease to CGI, but said Trump Organization must continue to pay the $250K per month to GSA, or some 180 million over the next 60 years (minus, of course, the time that has elapsed).



Mr. Trump had claimed that he would spend 200 million on redoing the old post office building. From what I have read, he certainly, at least, made it into a 5 star hotel (which literally is his expertise, say what you will about Donald Trump, he builds great hotels).



So, CGI is paying Trump Organization 375 million. But, if I have this right, said Trump organization has already spent 200 million on redoing the building, plus, they must continue to pay the $250K per month rental for the remainder of the lease (which CGI did not sign).



The lease was signed, so far as I can determine, in August 2013, but became effective November 2013, or, as it is now November 2021, 97 months.



97 times $250K = $24,250.000 the Trump Organization has spend on the lease.



The lease is for a total of 720 months (60 years). Or, in plain terms, Mr Trump agreed to pay $180,000,000.00 over the next 60 years.



Now, he 'sold' the lease for $375 million, reportedly.



Of that 375 million:


Subtract the 200 million Mr Trump claimed he would spend on the hotel. That leaves:



175 million.



The Trump Organization has already, as of November 2021, paid to GSA $24,250,000.



That leaves: $150,750,000.



Now, if I am correct, the Trump Organization is pledged to pay the lease terms over the next 636 months (or, 60 x 12 = 720 months, minus the 84 months already paid, equals 636 months): or $159 million.



Clearly, if my math is correct (which I do not trust) then this sale means that the Trump Organization is Losing some 9 million on this 'deal'.



I do not claim my numbers are correct, and I would like any intelligent counter response.

[r small]

The old Post Office Pavilion (Trump International Hotel) is one of the finest buildings in DC. It'll be even better once every last vestige of Trump's stewardship has been removed.

[natalie469]

Originally Posted by r small

The old Post Office Pavilion (Trump International Hotel) is one of the finest buildings in DC. It'll be even better once every last vestige of Trump's stewardship has been removed.

It's a beautiful building which will now be restored by removing the Trump name.

[r small]

Originally Posted by natalie469

It's a beautiful building which will now be restored by removing the Trump name.

Trump's name on that building is like a Hitler mustache on the Mona Lisa.