U.S. president’s name to be removed from struggling New York hotel
Marks second time this year Trump’s name gets erased
NEW YORK— The announcement came on his television show, The Apprentice. Donald J. Trump would open his second luxury hotel in New York, a “work of art” in the SoHo neighbourhood of Manhattan that would become “an awe-inspiring masterpiece.”
That was11years ago. The 46-storey skyscraper, it turned out, was actually an albatross for Trump — drawing local opposition soon after its unveiling, partisan protests when he became a presidential candidate and political scrutiny because of its early ties to a dubious Russian deal maker.
Now, in the latest sign of strain in the president’s family business, the Trumps want no more. The Trump Organization has reached a deal that will allow the company to walk away from the property by the end of next month, the company said Wednesday. It is the second time this year the Trump name was erased from a hotel development, after the company was bought out of its contract for the then-Trump International Hotel and Tower at Bay and Adelaide Sts. in downtown Toronto in June.
Located in an upscale neighbour- hood in a deeply Democratic city, the SoHo hotel has struggled to attract guests at five-star prices and has dropped its rates to keep rooms occupied. The property also includes condominiums that have been slow to sell. And when the building’s main restaurant decided to close in April, a lawyer for the restaurant attributed it to a decline in business “since the election.”
Under the exit deal, the Trump Organization will sever its contract with the building’s owner, an investment firm in California that focuses primarily on real estate. As with many of their properties, the Trumps do not own the SoHo hotel, but instead manage the day-to-day operations. The Trump Organization is entitled to a cut of the hotel’s revenue, although the contract also requires the Trumps to pay the owner, CIM Group, if the property fails to meet certain financial performance standards.