Why Are Trump’s Businesses in Trouble? It’s All in the NameRolling Stone — Ryan Bort
In his new book Commander in Cheat: How Golf Explains Trump, Rick Reilly writes of visiting the president’s signature golf property, Trump Doral. He was shocked by how few people were patronizing the Miami, Florida, resort. “I went there and it was so empty you could shoot a machine gun,” he told Rolling Stone last month. “In fact, the day I left someone did come in and sprayed the place with a machine gun and no one got hurt, because no one was there. I walked all over, and I saw one group.”
He said the same was true of Trump International, in Scotland; Trump International at Doonbeg, in Ireland; and Trump Ferry Point, in Queens, New York. “I think the presidency has really hurt his golf business,” said Reilly.
Reilly was right. On Thursday, the Washington Post reported that business at Trump Doral has been in “steep decline,” and that the resort’s operating revenue has plummeted by a shocking 69 percent in the past two years — or, since around when Trump took office. “There is some negative connotation that is associated with the brand,” Trump Organization tax consultant Jessica Vachiratevanurak told a Miami-Dade County official, according to video and documents obtained by the Post.
“This story is completely senseless,” Eric Trump, who runs the Trump Organization’s day-to-day business, said in a statement. “Our iconic properties are the best in the world and our portfolio is unrivaled by anyone.”
During his conversation with Rolling Stone, Reilly also happened to reference Eric Trump’s tendency to exaggerate the success of Trump properties: “Eric Trump lied at an opening and said, ‘Oh, we’re so busy here at Trump Ferry Point.’ And I said, ‘Oh really?’ So I went online Saturday night to get a Sunday tee time. I had my choice of the whole day. You know, $180 to play golf in the Bronx is not a big seller. His business is down, down, down.”
When the Post contacted the Trump Organization directly, the company blamed the decline at Doral on the Zika virus and hurricanes warding off tourists. But Vachiratevanurak, as well as statistics provided by the company to Miami-Dade County, make clear that Trump Doral is being outperformed by competing resorts.
It’s not just golf resorts. The Post notes that, according to internal documents, revenue fell at three Trump hotels in New York and Chicago after their namesake entered the presidential race. As with Trump Doral in Miami, the blame can’t be placed on the market, as competitive Chicago hotels did not experience the same decline as the one belonging to Trump. The Trump Organization, however, blamed “gun violence” as the reason the hotel, which is located downtown on the Chicago River, is suffering.
The Post‘s report comes a day after Bloomberg revealed that Trump’s 36-year-old flagship property, Trump Tower, is also in trouble. Those selling condos in the monolithic Midtown building are doing so at losses of up to 20 percent. Again, this isn’t a market issue, as Bloomberg points out that just 0.23 percent (57 out of 24,871) of homes sold in Manhattan in the past two years have been sold at a loss. “The luxury market is softening,” Matthew Hughes, a Manhattan-based broker at Brown Harris Stevens, told Bloomberg. “But it’s rare that someone owns an apartment here for 10 years and takes a loss.”
Trump Tower also features office space that has remained vacant despite being priced under market value, as well as an occupancy rate that has dipped from 99 percent to 83 percent over the past seven years, according to Bloomberg. Though the building still turns a profit, this is due in part to Trump’s campaign renting out space. Regardless, its income is 26 percent lower than what banks projected when they were sizing up Trump for a $100 million loan in 2012.
As the Post notes, there are some Trump Organization properties that are faring well. For the most part, they’re the ones that don’t bear the president’s name.