Trump’s company fights efforts to shed the president’s name
LATE last year, the owners of the Trump International Hotel in Panama made a decision: They no longer wanted to be a Trump hotel. The owners told President Donald Trump’s company they were terminating its management contract.
Last week, the Trump Organisation responded with a stern warning.
The company is not walking away, a Trump official wrote. And the owners would regret picking this fight.
“When Trump Hotels prevails,” the company wrote in a letter, the owners “will have millions of dollars in financial liability.”
Since the 2016 election, Trump’s company has found itself in an unfamiliar role: Not selling the Trump brand, but trying to save it from condo owners and unhappy partners seeking to shed the president’s name. The Trump Organisation has fired back - at times with legal threats.
The root of the disputes is a growing belief among investors in some locales that the Trump brand has turned from an asset to a liability.
“It’s a bloodbath, basically. It’s a financial bloodbath,” said Jeffrey Rabiea, a New York businessman who owns three hotel rooms in the Trump Panama hotel. Like other owners in the building, he blames the Trump company for mismanagement and attributes the low occupancy rates in part to the president’s polarising brand. “Nobody wants to go there. If you’ve got a Marriott and a Hyatt and a Trump, you’re not going to Trump.”
Eric Trump, one of the president’s sons who is helping run the Trump Organisation in his absence, declined to comment on its handling of properties seeking to drop their Trump affiliation.
Company officials have blamed other factors such as broader market conditions for the poor performance of some Trump-branded buildings.
Since Election Day, the Trump name has already been removed from luxury hotels in New York, Rio de Janeiro and Toronto, along with three apartment buildings in New York.
Behind the scenes, the Trump Organisation has also issued warnings to at least three more properties: the Panama hotel and two condo buildings in New York, according to documents obtained by The Washington Post and people familiar with the efforts. The president’s company manages the three properties but does not own them.
Before the election, his company had expansive plans for his brand, which already adorned more than 50 properties world-wide. But then Trump won.
“We walked away from 47 international deals for the Trump brand,” Trump Hotels chief Eric Danziger said at a real estate conference in New York on Wednesday. “Those are things I worked on for a year, from Tel Aviv, China, Amsterdam, Frankfurt, Munich. But when he became president he said we will not be doing new business in any foreign country.”
Since then, the Trump name has gone up on two new properties - a hotel in Vancouver and a golf course in Dubai. Both had been in the works before the election. Other longplanned properties are under construction in Uruguay, India and Indonesia.
But the president’s company has been quietly losing ground on other fronts.
Just after the election, residents of three apartment buildings called “Trump Place” on Manhattan’s liberal Upper West Side petitioned the owners to remove the name. They did. ( Trump had not owned the property for years.) The current owners said they wanted a “more neutral identity,” according to press reports.
Then the Trump Organisation itself decided to pull out of the Trump hotel in Rio - a longtroubled property whose owner was wrapped up in a Brazilian corruption investigation.
Next to go was the “Trump Carousel” in New York’s Central Park.
The problem there: “It was never named Trump Carousel,” said Crystal Howard of the New York City parks department.
She said the Trump Organisation - which had a contract to operate the attraction, whose name is the Friedsam Memorial Carousel - had simply put up a sign that renamed it “Trump Carousel.” The sign seems to have been up for months, but the city only learned of it in April 2017. Officials ordered the sign taken down that day.
Later in the year, the Trump Organisation suffered a pair of much more painful blows: The loss of the Trump hotels in Toronto and Manhattan’s SoHo neighbourhood. Both had opened to enormous fanfare, luxury outposts that were meant to make Trump’s name synonymous with urbane success. “Never settle,” the hotel key cards said.
But both were located in cities hostile to Trump’s brand of politics. In June, the owners of Trump Toronto said it would be renamed. A few months later, so did the owners of Trump SoHo - which had seen a drop in business from corporate clients and pro sports teams after Trump began his campaign.
Those decisions likely cost the Trump Organisation hundreds of thousands in management fees: Trump Toronto alone brought in about US$ 559,000 during 2016 and the first part of 2017, according to Trump’s financial disclosures.
In SoHo, the renamed hotel has already seen signs of business returning.
“People who had stopped staying with us for a while are now interested in coming back,” said Nicole Murano, a spokeswoman for the newly christened Dominick Hotel, which was the Trump SoHo until several weeks ago.