Archive | Donald Trump

Sydney Schanberg chronicles the brash, outrageous and often phony offers made by Donald Trump in New York City throughout the 1980s and 90s.

‘Why Pay Less?’ Is the Trump Chump Philosophy

By Sydney H. Schanberg

First published in Newsday, May 24, 1988

Every time I think I’ve got Donald Trump figured out, he confounds me. Take the full-page ad he bought in yesterday’s New York Times. The whole back page of the first news section, which the Times sells for $39,000 and change. So Donald Trump took Ivana’s weekly clothing allowance to buy an ad just to tell us that the apartments in his Trump Tower cost more than anybody else’s in New York City. The ad doesn’t say the apartments are the most luxurious in all Gotham or the best constructed or even that they have the most spectacular views. They just cost more money, it says.

In some cities, that might put people off as just the slightest bit tacky. Not in New York. To pay more for something here is to go to the top of the nouveau heap instantly. Picture the oneupmanship at a table in Mortimer’s: “Did I tell you, my dears, we just bought an apartment. In Trump Tower. You won’t believe this, but it was $1,273 a square foot. The highest per-square-foot price in the entire city. You can see why we simply had to have it.”

The quote may be fictional, but the square-foot championship price was a central part of Donald’s ad. So was his claim, taken from a survey done by a luxury condo broker, that “the top price paid for an apartment in New York City in 1987 was in Trump Tower.” Then it said: “Amazingly, of the 10 most expensive apartments, four were in Trump Tower.” And that was about it, except for a final sentence which said that “The Trump name, locations and buildings have proven, once again, to be the standard by which all others are judged.”

He presumably means the gold standard or, since that’s old hat, maybe the Croesus or cupidity standard.

Donald has changed. Time was when he would have died before he would have defined Trump Tower by its price tag.

Remember his original brochure for the 68-story pyramid? “Imagine a tall bronze tower of glass,” it said. “Imagine life within such a tower. Elegant. Sophisticated. Strictly beau mode…Quickly, quietly, the elevator takes you to your floor and your elevator man sees you home. You turn the key and wait a moment before clicking on the light. A quiet moment to take in the view — wall-to-wall, floor-to-ceiling — New York at dusk. The sky is pink and gray. Thousands of tiny lights are snaking their way through Central Park. Bridges have become jeweled necklaces. Your diamond in the sky. It seems a fantasy. And you are home.”

That was back in 1982. Donald was still a poet then. Something has corroded and jaded him. Maybe it’s the cynicism that seizes a man’s soul when his victories come too easily and, as time passes, he finds fewer and fewer challenges worthy of him. Maybe it’s his disappointment with h is early role model, Mayor Edward Koch. Maybe it’s his dream of the White House, a dream deferred as he looks at his party’s nominee, George Bush, and wonders where the nation’s spine went. Not to mention its poetry.

Whatever the tangled roots of his malaise, he’s not the Donald we used to know. The old Donald wouldn’t have bothered to take out this ad. He would have just sneered at those who would quibble with his superlatives, and then he would have wandered onto the moors and written more poems.

You see, the reason Donald bought the ad was that he allowed himself to get upset by an article in 7 Days, a bright new weekly magazine about life in Manhattan. The article, by Samantha Roberts, said that some golden people who had bought apartments in Trump Tower and later became disillusioned were having trouble now selling their “diamond in the sky.” A number of them have taken losses in order to unload the flats.

The 7 Days article was an update of a more comprehensive New York Newsday piece by Sylvia Moreno that ran a year ago. That piece described how “Paul den Haene, the former owner of Poland Spring Co., took a $251,000 bath on the resale…of three condos in the tower for which he had paid $2.6 million.” Den Haene described the materials and the craftsmanship in the apartments as “cheapo, el cheapo.”

Why should Donald care about what sore-loser Philistines think? Why doesn’t he consult the muses anymore instead of getting down and dirty into demeaning mud fights? Like the lawsuits he’s always filing against the city and state to get better tax breaks — even though he hardly knows what to do with the money when he wins.

Even on Trump Tower, where he made perhaps $100 million in clear profit, he couldn’t turn the other cheek when the city sought to deny him the special tax gifts because it was a luxury building instead of a place within reach of ordinary mortals. He sued the city and won his tax gift — a swell $40 to $50 million.

And now he’s taking out ads telling us his Trump Tower apartments are selling for world record prices. They’d be even more expensive if he hadn’t got the tax subsidy from the public treasury.

You know, I don’t want to be petty, but I figured it out, and $6.39 of that tax break was my money. A lot of my friends paid, too.

Donald, next time you take out an ad, make it poetic — poetic justice. Let it be an announcement, to all of us who have contributed to your support payments, that the check is in the mail. 

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Here’s a Chance to Be the City’s Hero, Trump

By Sydney H. Schanberg

First published in Newsday, March 10, 1987

Over the years, I have written a number of columns critical of Donald Trump — for his harassment of tenants, for his self-promotion, for his fibbing, for his glitz and hype, for his grandiosity and for his expressions of concern about the homeless while doing nothing to help them.

I have tweaked him, cajoled him, satirized him and just flat-out berated him. And still he doesn’t seem interested in using his considerable talents on behalf of the homeless or in amelioration of any of the other social problems that he says trouble him. So now it’s time to challenge him.

I say let’s dare Donald Trump — real estate developer, impresario of tall buildings and taller publicity — to be as successful at helping the city as he has been at helping himself. And I want to make clear at the start that this column is not written tongue in cheek or as a putdown.

Virtually everyone — not just Donald Trump — says that he’s a world-class deal-maker. There are those who point out, with some justification, that he has engineered a very large number of headlines out of only a small number of major projects, but even these non-cheerleaders acknowledge that he is someone who can put big things together and bring them to completion.

Just take a look at your favorite newspaper or television station on any given week. There’s Donald Trump announcing something, winning something, being asked his opinion on something.

Last Thursday night, for example, he appeared on national television in the miniseries, “I’ll Take Manhattan,” playing himself and helping out poor little Valerie Bertinelli (who needed some cash in a hurry) by buying back her apartment in Trump Tower for $6 million. Later that evening, he appeared on “Nightline” giving his thoughts on what it will take to put the Reagan presidency back together again. (He said the president had to “be very assertive, be very strong, be very open.”)

Yesterday, he bought another gambling casino in Atlantic City, Resorts International, to add to the two he already has there, Trump’s Castle and Trump Plaza. The price tag was $79 million, but that was no problem. He had the money virtually hanging around — because he had made clear, swift stock profits of about $70 million in two recent takeover attempts aimed at other casino companies in Atlantic City.

And when he’s not making money on real estate of casino deals, he’s sponsoring a parade for the Stars and Stripes yachting crew who regained the America’s Cup trophy this year from Australia. Or he’s being mentioned as a potential political candidate or as a kingmaker for another candidate. Or he’s upstaging Mayor Edward Koch — by taking over the botched Wollman skating rink project and restoring in a few months this ice arena in Central Park that the city had floundered for six years at a waste of $12 million.

That’s the way it’s done, Ed, said the 40-year-old builder to the mayor, who did not take kindly to having his place in front of the TV cameras usurped.

Thereupon has followed a sniping war between Koch and Trump, with the developer saying he could run this or that city protect better and the mayor answering first with critical personal jabs and then, interestingly, by inviting Trump to prove his stuff by building housing for homeless people. 

“Donald,” the mayor said rhetorically at a forum, “right now I’m giving you an offer: Build us housing — residential or interim — for the homeless. Why don’t you come in, Donald, and show us how good you are.”

Donald Trump’s piqued response was designed as an offer the mayor had to refuse. Trump said: “When Ed Koch admits he is unable to build housing for the homeless, when he totally admits, when he totally concedes his inability to do this, then I’ll be glad to get involved.”

What you have here is the sound of two huge egos crashing into each other. The sour sound of stalemate.

But the idea is a terrific one. Donald Trump could step in, build the housing for the homeless or the apartments for low-income working people that other developers say can’t be built because of present costs — and he would walk away a hero. For he not only would have delivered a boon to the city but in the same stroke would have polished his reputation for all time.

The man who made his name by brashly and boastfully erecting towers to house the super-rich would have produced a breakthrough for the homeless and the working poor. It would confound his most tenacious critics.

Better still, if Trump were to do this, lead the way, the other master builders in this town — Zeckendorf, Macklowe, Silverstein, Kalikow, Tishman, Lefrak et al — would have a very hard time hanging back. They would have to either duplicate his effort or admit he is better than they are.

So, Donald Trump, that’s about it. We know you’re not really interesting in getting into the mess and hassle of low-income housing. There’s no profit, no glamour.

But what a coup it would be — for you and for the rest of us.

 

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Step Right Up, The Donald Has a Deal for You

By Sydney H. Schanberg

First published  in Newsday, April 4, 1995

Step right up, cries the barker with the jaunty derby and twirling cane, don’t miss out on your chance of a lifetime. Donald Trump has a deal for you. Please come closer, folks, I have to whisper this: If you act quickly, Donald is willing to sell you $285 million in casino stocks and bonds. And, oh yes, before I forget, the Securities and Exchange Commission has asked me to advise you that the odds are you’ll never see this money again.

That’s right, Young Donald is offering anew to let you buy the heirloom lint that is the last remaining occupant of his pants pockets. He’s still buried in a mountain of debt, more than $100 million of it personally guaranteed. So naturally, being a man of the people, he would like you to bail him out before he has to do something vulgar, like filing for personal bankruptcy.

Such an act could shut him down as the gambling king of Atlantic City, since New Jersey law requires casino owners to have “financial stability.” The Trump Organization “owns” three heavily debt-burdened casinos there. All three have been losing money. That’s of course why Donald, as a financial sage, wants to expand them — with other people’s money.

As you know, Donald has been running these hustles for years, conning local governments into subsidizing his projects (e.g., Trump Tower got about $40 million from New York City in tax reductions) and conning banks and insurance companies into loaning him the construction costs. In case you still think that big-name bankers are an intelligent race, just look at the customer money they’ve thrown away on their judgment that Donald Trump was a stable businessman.

It’s helpful not to lose touch with Donald’s unstable history. Remember how he reneged on his agreement to renovate the subway complex below the Grand Hyatt hotel? Remember how, after trying the usual strong-arm tactics to roust legal tenants out of a building on Central Park South so he could tear it down, he then offered — surely out of profound humanitarianism — to put homeless people in the apartments that were vacant? And remember how, when he served as chairman of the New York committee to build a local Vietnam memorial, he offered to pick up most of the cost if only the veterans on the committee would agree to name it the “Trump” memorial?

More recently on Donald’s history channel, in 1990 he and his companies defaulted on $3 billion of debt. The banks put him on an allowance. Unfortunately, from his early days as a school truant, Donald has never been able to live within his allowance. Nothing has changed, so he’s always short of the cash he requires to keep his name on the party lists and in the gossip columns. As a result, he has had to resort to his legendary hustles.

According to an interesting story by David Cay Johnston in yesterday’s New York Times, Donald has met his personal needs only by drawing unusual fees from his main gambling joint, the Trump Plaza Hotel and Casino. Last year, he took a $572,000 fee for negotiating a lease of space to Time Warner in a planned expansion of the hotel — an expansion that was halted by a judge’s ruling last week. Time Warner has yet to pay anything for the lease and may never do so; it has the right to cancel the agreement within two years.

On that same planned expansion, Trump was also personally paid a $1-million “construction management services” fee to supervise demolition of the building next door.

Even this expansion is being financed with other people’s money — in this case, the public’s dough. There’s something in New Jersey called the Casino Reinvestment Development Authority (CRDA), and this body awarded Donald $14.6 million in tax credits, which represents more than a quarter of the $55-million expansion price tag.

CRDA also invoked eminent domain in condemning three privately owned parcels of land that Trump wants for the expansion. Last week’s decision by a New Jersey judge threw out the condemnation, noting that Trump had, after the fact, altered his expansion plan to include additional gambling space, instead of just additional hotel rooms. In essence, the ruling said that the condemnation of the $14.6-million award violated state policy because it represented a use of public monies for a private person’s benefit. Trump’s lawyers said they would appeal.

Meanwhile, in the event any of you are contemplating throwing some mad money at Trump’s proposed stock and bond offerings, I suggest you read the fine print of the documents he submitted to the SEC last week for review.

These papers, for example, caution potential buyers that “there can be no assurance that Trump will be successful in repaying or rescheduling his indebtedness or that his assets will appreciate sufficiently to provide a source of repayment for such indebtedness.”

Another chilling sentence reads: “Any failure by Trump to repay or reschedule his indebtedness or otherwise maintain financial stability may have a material adverse affect” on the payment of interest or return of principal.

Donald never wrote sentences like these in the heady days before he was under surveillance. He just took other people’s money and bought a yacht with gold fittings and cruised around as if he was something more than a hustler.

 

 

 

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Trump’s Latest Deal: Finagling Atlantic City

By Sydney H. Schanberg

First published in Newsday, September 9, 1994

Donald Trump is cheating at cards again, appropriately in Atlantic City. He’s trying to fleece some of their property so he can expand his Trump Plaza Hotel and Casino.

And not for the first time, he has managed to stack the deck: He has found a way to get the local governmental agencies to do his dirty work for him. As chiseling schemes go, it’s a doozy.

Here’s how the scam is structured. Trump is trying to buy up a while block adjacent to Trump Plaza to put up new hotel rooms, a parking lot, limousine pickup area and the like. He wants to cash in on the business generated by a $254-million convention center scheduled to open in 1996 a short distance from the Plaza, one of the three casinos he runs in Atlantic City.

But instead of negotiating with the owners of the private parcels he needs on the block, he got the Atlantic City Planning Board and the state Casino Reinvestment Development Authority (CRDA) to move in on the properties by edict. The planning board began issuing approvals for the project and CRDA started condemnation proceedings under the law of eminent domain.

CRDA’s rationale is that the casino expansion serves the community interest because it will support the new convention center. It’s not clear how Trump won the allegiance of these public officials — that will probably come out later, in some court proceeding, as often happens with Trump — but the result is a familiar one: Trump, the property shark and deal-maker is in line to get another freebie.

In short, the state (CRDA) plans to seize the private land at fire-sale prices, pay for it with taxpayer dollars and the hand it over to Trump for nothing, to profit from as he pleases.

Not surprisingly, two of the property owners facing condemnation have stood up to cry foul. One is Vera Coking, who has a small three-story house where she lives with her daughter, Barbara Torpey, under the shadow of Trump’s casino. The other protester is the Sabatini family, whose restaurant has sat for 30 years a little ways down the block on the prime corner of Columbia Place and Pacific Avenue.

Six years ago, the Sands casino company, which was then trying to develop the block, made an opening offer to the Sabatinis for $1.5 million. But that project died aborning. Now, though Atlantic City is bustling with development activity, CRDA says the property is worth no more than $700,000, setting that as its final figure.

CRDA’s appraiser reached this figure by comparing Sabatini’s restaurant to four other restaurants. The curious part about the comparison was that the four restaurants are all empty and out of business and none of them was in the busy casino district.

As for Vera Coking and her weatherbeaten house, CRDA set its price at $251,000. Penthouse’s Bob Guccione, another who tried to develop the block and failed, says he offered her $1 million. When she refused, he decided to build around her narrow lot and got the steel superstructure up before he pulled out. Now, several years later, CRDA says its condemnation price is $251,000. Coking’s lawyer says the property is worth $2 million.

Trump and his attorneys have tried to portray Coking, a widow, as a person who has put her personal gain above the interests of the city. Coking, responding, said: “There’s a lot of memories in here. I raised my kids in here. I’m not greedy. I just want a fair price.”

The Sabatinis are also pretty upset. “We’re not blocking progress,” said son Louis, 37, a doctor. “You can call it eminent domain and you can call it public good, but they’re trying to steal our property, and it’s rotten.”

“We’ve been good neighbors and good community members,” said his mother, Clare Sabatini. “We’ve been here for 30 years, in lean times as well as good ones. We made sacrifices to put four kids through college. All we want is a sensible offer.”

The Sabatinis and their own appraiser came in with a property value that was at least three times the $700,000 price set by CRDA.

When CRDA held a meeting last month on the condemnation decision, Trump’s cozy relationship with the government officials became quite clear. Instead of sitting in the public seats, he entered at CRDA’s end of the room and stood directly behind the board members, facing the audience. Trump and CRDA were one. 

Another tip-off: Under the law, it was supposed to be a public hearing with questions allowed from anyone, but when the attorneys for Coking and the Sabatinis tried to raise several issues, they were cut short and the meeting was quickly adjourned with a bang of the gavel.

There are still some innings to go, among them a review process to examine the legality of the condemnation and the fairness of the money offers. If dissatisfied with those results, a landowner can seek a jury trial to set the price on the property. Judging from the rigged deal we’ve seen so far, Coking and the Sabatinis may have to go all the way.

In civics class way back when, we were always taught that eminent domain could be invoked only for a public purpose. In Atlantic City, we are watching it being used to benefit a private person, Donald Trump. 

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