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Title: Trump Sees Act of God in Recession
Source:
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URL Source: http://www.nytimes.com/2008/12/05/b ... SBI95f7Lw3sfHIw&pagewanted=all
Published: Dec 4, 2008
Author: FLOYD NORRIS
Post Date: 2011-04-09 13:08:13 by Skip Intro
Keywords: None
Views: 49008
Comments: 61
Guess who is complaining that condominiums in Donald Trump’s latest big project are ridiculously overpriced. Donald Trump is. But he isn’t cutting the prices. He says the banks won’t let him. The project is the Trump International Hotel and Tower in Chicago, which is to be the second-tallest building in that city (after the Sears Tower). By Mr. Trump’s account, sales were going great until “the real estate market in Chicago suffered a severe downturn” and the bankers made it worse by “creating the current financial crisis.” Those assertions are made in a fascinating lawsuit filed by Mr. Trump, the real estate developer, television personality and best-selling author, in an effort to avoid paying $40 million that he personally guaranteed on a construction loan that Deutsche Bank says is due and payable. Rather than have to pay the $40 million, Mr. Trump thinks the bank should pay him $3 billion for undermining the project and damaging his reputation. He points to a “force majeure” clause in the lending agreement that allows the borrower to delay completion of the building if construction is hampered by such things as riots, floods or strikes. That clause has a catch-all section covering “any other event or circumstance not within the reasonable control of the borrower,” and Mr. Trump figures that lets him out, even though construction is continuing. “Would you consider the biggest depression we have had in this country since 1929 to be such an event? I would,” he said in an interview. “A depression is not within the control of the borrower.” He wants a state judge in the Queens borough of New York to order the bank to delay efforts to collect the loan until “a reasonable time” after the financial crisis ends. Deutsche Bank thinks the idea that an economic downturn should free people from the obligation to pay their debts is laughable. Mr. Trump, it may be noted, does not think remorseful condominium buyers are in a similar position. When I asked him if he would let them walk away from contracts to buy apartments at predepression prices, he said he would not. “They don’t have a force majeure clause,” he said. The suit, and a parallel one by Deutsche Bank seeking the money, provide a glimpse into both how Mr. Trump does business and into the way the real estate loan market was operating in 2005, when the loan was made. For this big project, built on the site of the old Chicago Sun-Times building, it appears from the court papers that Mr. Trump put in little of his own money. He got a construction loan for up to $640 million from a syndicate headed by Deutsche Bank and a $130 million junior loan from another syndicate headed by Fortress Investments, a hedge fund operator that has troubles stemming in part from bad loans made for other real estate projects. The people who negotiated the construction loan did not think real estate prices could tumble. The loan agreement requires partial repayment each time an apartment is sold and provides a detailed list of the minimum prices to be charged. According to Mr. Trump’s suit, he cannot cut prices without the unanimous consent of the lenders, and that has not been forthcoming. There are a lot of lenders in the deal, and some of them appear to be banks and hedge funds that are no longer in good shape. The loan was due Nov. 7, and the lenders did not grant a requested extension. Mr. Trump filed his lawsuit just before that deadline. Mr. Trump sees a dark conspiracy. He says Deutsche Bank, through a subsidiary, owns $30 million of the junior loan, and he says that is a blatant conflict of interest because in some cases the interests of the two loans can differ. To Mr. Trump, the bank’s actions suggest it is trying to seize the building just before its great success is assured. The bank responds that the loan agreement makes clear that it has a right to do everything it has done, and that Mr. Trump should live up to his obligations, paying $40 million of the $334 million outstanding balance on the construction loan. The rest is owed by the Trump-controlled company sponsoring the project but is not personally guaranteed by him. If Mr. Trump was forced to pay the $40 million, he would be unlikely to permanently lose it, since his company would owe it to him. If the project went under, his claim would rank higher than the Fortress loan. Deutsche will make nothing from its investment in the junior loan if Mr. Trump does lose any money. Some sort of settlement seems wise. It is in everyone’s interest that construction be completed, and in fact the bank advanced $13 million to pay contractors’ bills this week. Mr. Trump has not said by how much he thinks the apartments are overpriced, and he did not tell me. But it seems unlikely that sales will be very good until prices are cut. In his suit, Mr. Trump claims that the bank’s “predatory lending practices” are harming his reputation, “which is associated worldwide with on-time, under-budget, first-class construction projects and first-class luxury hotel operations.” The bank seized on the opportunity to discuss Mr. Trump’s reputation. “Trump is no stranger to overdue debt,” it said in asking that his suit be thrown out of court. It noted that Mr. Trump’s casino operations have filed for bankruptcy twice, adding, “This suit is classic Trump.” The bank did not discuss why that history did not dissuade it from making the loan. One explanation might be that the fees it got for arranging the loan more than offset the risk from the small part of the loan it kept on its own books. Mr. Trump is vigilant in protecting his reputation. After I interviewed him and two associates, his general counsel sent me a note saying “it was a pleasure” talking to me, and adding: “Please be assured that if your article is not factually correct, we will have no choice but to sue you and The New York Times.” The Friday after Thanksgiving was not a really good one for Mr. Trump. Trump Entertainment Resorts, the casino company, announced it would miss an interest payment on its bonds, raising the likelihood of a third bankruptcy. Most of the shares are publicly owned, having been distributed to creditors in the last bankruptcy. They have fallen from a peak of $23.80 two years ago to 24 cents on Thursday. Mr. Trump is doing his best to sound like that is not important to him. The casino company’s announcement emphasized that Mr. Trump was the “nonexecutive chairman” who was “not involved in the daily operations” of the company. He told me that “less than 1 percent of my net worth” is in the casino company. At the current price, no shareholder could have a large net worth in that stock. On the same day, in New York, Deutsche Bank asked a judge to issue a summary judgment requiring Mr. Trump to pay the $40 million. In that filing, the bank quoted from a best-selling book Mr. Trump wrote last year, “Think Big and Kick Ass in Business and Life.” In it, the developer said he loved “to crush the other side and take the benefits” and mocked the banks that had lost money on loans made to him before another real estate downturn, in the 1990s: “I figured it was the bank’s problem, not mine. What the hell did I care? I actually told one bank, ‘I told you you shouldn’t have loaned me that money. I told you the goddamn deal was no good.’ ” If Mr. Trump manages to persuade a judge that the current crisis provides him with a good reason not to meet his obligations, he will have some great tales to tell in his next book.
Poster Comment: Old news, but a good view into how Trump operates. "One set of rules for me, another set for you".
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Comments (1-20) not displayed.
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#21. To: Murron (#19)
I've never seen a statement by her regarding citizenship since she was the VP candidate.
LOL! What little credibility you may have had just went out the window , honDOPE! You are really pathetic.
You getting the "peanut gallery" stirred up again????? .......LOL.....
"I love the 45 caliber M1911, I respect the 9MM M9 Beretta but I only carry a CZ for my own personal protection". Quote courtesy of Lt Col John Dean Cooper, recognized as the Father of Modern Handgunning
While yukon was visiting his Alaskan bath houses; we were in Vietnam; the punk has never served in the military knowing he would be kicked out for his sexual voyeur exploits. According to Goldi-Lox, "they" are born that way and it is no fault of their own.
Making a fool of yourself is easy for you, clyven. You are a liar, thief, coward, fraud, impersonator and deserter, besides being an old perverted alcoholic. Your woody for Goldi is legendary and so childishly pathetic. You are a psychopath.
So then she doesn't 'take it back'.
"http://first-draft-blog.typepad.com/.a/6a00d8341c5ced53ef0148c7a28c4b970c-320wi"
The list of accomplishments which earned you the "conservative" canary award?
I recall a re-run of MASH I saw where this uber right winger named Colonel Flagg... Take what back? Her VP candidicy?
Only a dope would call lying, stealing, cheating, impersonating and fraud, accomplishments.
The object of your statement.
"http://first-draft-blog.typepad.com/.a/6a00d8341c5ced53ef0148c7a28c4b970c-320wi"
My statement?
"http://first-draft-blog.typepad.com/.a/6a00d8341c5ced53ef0148c7a28c4b970c-320wi"
Which one? Be specific.
"http://first-draft-blog.typepad.com/.a/6a00d8341c5ced53ef0148c7a28c4b970c-320wi"
Why do you continuously suggest that I am all these characters on all these chit-chat forums? Where is the PROOF? Some CT theorist BS concept that you heard? A mere rumour? Pure gossip? Pure baloney that you eat at the Alaskan bath houses? Well, it is no rumour you are a self-admitted TWINK. Is it?
Ask "yukon" about her military background. She claims others are cowards and deserters (such as myself) while she was enjoying an Alaskan bath house.
Which one? Be specific, libtard.
You forgot to include immoral, thief, liar, fraud, psychotic and impersonator, you perverted old alcoholic.
"http://first-draft-blog.typepad.com/.a/6a00d8341c5ced53ef0148c7a28c4b970c-320wi"
You are retarded, aren't you libtard?
Sounds like Whitesands in her expressed hate for US soldiers. But all those yellow Neocons sound alike. I bet the religious affiliation is the same too.
"http://first-draft-blog.typepad.com/.a/6a00d8341c5ced53ef0148c7a28c4b970c-320wi"
"http://first-draft-blog.typepad.com/.a/6a00d8341c5ced53ef0148c7a28c4b970c-320wi"
You are retarded, aren't you libtard?
Do you have that macro'd to your keyboard?
Actually, I feel sorry for you, yu-klown. Growing up with Sally as a mother would probably turn anyone queer.
I guess that takes some of the responsibility off mommy's shoulders.
Actually, I feel sorry for you, yu-klown. Growing up with Sally as a mother would probably turn anyone queer.
That's a pretty funny demand coming from the Dancing Queen himself.
Actually, I feel sorry for you, yu-klown. Growing up with Sally as a mother would probably turn anyone queer.
I shall keep posting it as long as necessary. Do you support immoral, thieves, liars, cheats, frauds and inpersonators?
What is funny is your support of libtards.
At least you can't hide behind some other handle, pansy.
Actually, I feel sorry for you, yu-klown. Growing up with Sally as a mother would probably turn anyone queer.
Sucks getting it back in spades, doesn't it?
Actually, I feel sorry for you, yu-klown. Growing up with Sally as a mother would probably turn anyone queer.
I never hid, liar. Why do you support immoral thieves, cheats, liars, frauds and impersonators? Didn't you claim to be a Christian?
Getting what back? I don't steal, cheat, lie and impersonate. You support that don't you? You claim to be a Christian, don't you?
Unremitting truth about you with no protector to make the mean people go away.
Actually, I feel sorry for you, yu-klown. Growing up with Sally as a mother would probably turn anyone queer.
I never hid, liar. Why do you support immoral thieves, cheats, liars, frauds and impersonators? Didn't you claim to be a Christian? Where did you go, liar?
I'm here, fag. Being Christian means being against what you stand for. Treason, selling out this country for money, appeasing the enemies of this country with scum like McCain and every other RINO you and Yenta-Lox and the rest of your Israel First traitors can find to endorse.
Actually, I feel sorry for you, yu-klown. Growing up with Sally as a mother would probably turn anyone queer.
I don't stand for immoral, lying, thieving, cheating, fraudulent, dishonorable impersonators. You do.
Sell-out, Israel Firster. Fuck off, traitor.
Actually, I feel sorry for you, yu-klown. Growing up with Sally as a mother would probably turn anyone queer.
LOLAY! Where did you come up with that BS, halfwit?
Ham-Hox' own little boy not inline with mommy's guiding principle? Horrors! Don't let mommy find out or she'll cast you into outer darkness.
Actually, I feel sorry for you, yu-klown. Growing up with Sally as a mother would probably turn anyone queer.
Not only do you support immoral liars, you are one.
crackerjack birth certificate from a bunch of zombies - groupies !
If you ... don't use exclamation points --- you should't be typeing ! Commas - semicolons are for girlie boys !
Has Sarah backed off on her stand to give illegal aliens a path to citizenship?
#22. To: hondo68 (#20)
They're globalist neocon, liberal pussies
#23. To: A K A Stone (#12)
You can call me an idiot. But you can't back up your position. Except to say it isn't so.
#24. To: hondo68, yukon (#20)
#25. To: buckeroo (#24)
#26. To: yukon (#21)
I've never seen a statement by her regarding citizenship since she was the VP candidate.
#27. To: yukon, buckeroo, *Yukon neo-Progressive Vermin* (#25)
a liar, thief, coward, fraud, impersonator and deserter, besides being an old perverted alcoholic
"We (government) need to do a lot less, a lot sooner" ~Ron Paul
Godwinson posted on 2011-02-23 11:47:32 ET
http://libertysflame.com/cgi-bin/readart.cgi?ArtNum=18011&Disp=46#C46
#28. To: Rek (#26)
So then she doesn't 'take it back'.
#29. To: hondo68 (#27)
The list of accomplishments
#30. To: yukon (#28)
Take what back? Her VP candidicy?
#31. To: Rek (#30)
The object of your statement.
#32. To: yukon (#31)
The object of your statement.
#33. To: Rek (#32)
The object of your statement.
#34. To: yukon (#33)
The object of your statement.
#35. To: yukon (#25)
#36. To: hondo68, yukon (#27)
"yukon"
#37. To: Rek (#34)
The object of your statement.
#38. To: buckeroo (#36)
coward and deserter
#39. To: yukon (#37)
The object of your statement.
#40. To: Rek (#39)
#41. To: buckeroo (#36)
Ask "yukon" about her military background. She claims others are cowards and deserters (such as myself) while she was enjoying an Alaskan bath house.
#42. To: yukon (#40)
The object of your statement.
#43. To: Rek (#42)
#44. To: yukon (#25)
ou are a liar, thief, coward, fraud, impersonator and deserter, besides being an old perverted alcoholic.
#45. To: buckeroo (#24)
According to Goldi-Lox, "they" are born that way and it is no fault of their own.
#46. To: yukon (#33)
Which one? Be specific.
#47. To: Rudgear (#44)
Do you have that macro'd to your keyboard?
#48. To: Rudgear (#46)
That's a pretty funny
#49. To: yukon (#47)
#50. To: yukon (#48)
#51. To: Rudgear (#49)
At least you can't hide behind some other handle, pansy.
#52. To: Rudgear (#50)
Sucks getting it back in spades,
#53. To: yukon (#52)
#54. To: Rudgear (#53)
Unremitting truth about you
#55. To: yukon (#54)
#56. To: Rudgear (#55)
Being Christian means being against what you stand for.
#57. To: yukon (#56)
#58. To: Rudgear (#57)
Israel Firster.
#59. To: yukon (#58)
#60. To: Rudgear (#59)
#61. To: Skip Intro (#5)
He did provide a birth certificate.
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