Manhattan condo owners rue the day they bought a Trump apartment
Trump argues that he is not guilty of fraud because there were no victims of his financial piracy. People who own condos in Trump-branded buildings disagree. The value of their assets has taken a beating in contrast to the rest of the Manhattan real estate market. And that decline does not account for his latest legal spanking — and the concomitant further decline in his reputation.
As the New York Times reports (paywall should be down):
But up and down the spine of Manhattan, condominiums in high-rise buildings emblazoned with Mr. Trump’s name have underperformed, according to sales data from two real estate tracking firms, and an analysis of the data by the Columbia University economist Stijn Van Nieuwerburgh.
Specifically in 2016:
In a one-year window, condos in buildings that had the Trump logo went from selling at a 1 percent premium compared with similar units, to selling for 4 percent less, meaning that Trump condos became a “bargain” among the city’s luxury units, said Mr. Van Nieuwerburgh, a professor of real estate.
His crown jewel is now fool’s gold and out-of-date:
Even the Trump Tower on Fifth Avenue, one of the crowning achievements of the Trump brand, whose 80-foot cascade flowing down a wall of peach marble was reportedly built with slabs handpicked at a quarry in Italy by Mr. Trump’s ex-wife, saw the average price per square foot of its condominiums tumble 49 percent since 2013, according to Ondel Hylton, the senior director of content and research at CityRealty. The building’s age, growing competition from the ultra-luxurious condos on nearby Billionaires’ Row and regular protests have all dampened interest, Mr. Hylton said.
Although there is a solution for some. Erase any mention of the value-destroying brand:
By contrast, condominiums in four buildings where the Trump logo was removed at the behest of residents — sometimes after a legal battle — have seen their value shoot back up.
“This analysis cleanly identifies that it is the Trump brand that is responsible for the value deterioration,” Mr. Van Nieuwerburgh said. “Removing the Trump name from the building removes the loss associated with the name.”
The news is not going to get better for Trump. In March he will stand trial for paying off a porn star. He could get jail time. And even if he does not, his adultery with a porn star, as he ignored his new wife and recent baby, will neither improve his reputation nor the value of his holdings. And the MAGAs will not help. They cannot afford his apartments.
A tale told by an idiot full of vanity and deceit
Trump has estimated his net worth as high as $10 billion. That is a number so far removed from reality that he could not get there just with ludicrous overvaluations of his real estate. He had to add the value of his ‘brand’. Which he has pegged as high as $3 billion — depending on his mood.
Brand valuation calculated either by the money spent to build it. Or by a reasonable estimate of what someone is willing to pay to buy the brand. Superficially, Trump’s estimate of of his brand’s worth at 30% of his organization’s total value has some possible legitimacy. The Economist reported data assessing the power of brand value and brand valuation, asserting, “Brands account for more than 30% of the stock market value of companies in the S&P 500 index.” Additionally, in a survey conducted by the World Economic Forum and public relations firm FleishmanHillard, “Three-fifths of chief executives said they believed corporate brand and reputation represented more than 40% of their company’s market capitalization.
But this is Trump. So you know it is a lie.
To start, Trump’s valuations of his properties have been proven to be not just wrong, but fraudulent. Forbes’ highest estimate of Trump’s worth was $4.5 billion in March 2016. Although in 2015, they said Trump "shares a lot of information with us that helps us get to the figures we publish", and he "consistently pushes for a higher net worth—especially when it comes to the value of his personal brand". By 2023, they said he had "for decades" been "relentlessly lying to reporters to try to vault himself higher on the [Forbes 400] list."
So even Forbes admits their estimates were historically too high.
For the sake of argument, let’s say Trump’s real estate is worth $2 billion. A typical brand valuation would add $600-$800 million — if the Trump Organization were a publicly traded company that was playing by the SEC’s rules — and observed the tight accounting rules and controls that companies listed on stock markets have to play by. It is not. And it does not.
The Trump Organization is privately held. Its long time and now ex-CFO, Allen Weisselberg has admitted he has no idea what generally accepted accounting principles (GAAP) are. And he is a financial felon with a bad memory, who is about to make a plea deal to settle perjury charges.
Can Trump fall back on murderous thugs?
The owners of Trump condominiums will attest that Trump valuation of his name is absurd. The brand is now a liability rather than an asset. The only thing that would give it value is if the Saudis decided to buy it. And at this point they could snap it up for cents on the Trump dollar.
But even that possibility goes away if he loses the election.