People cannot get away from Trump Tower fast enough.
When Donald Trump built Trump Tower in the 80s (by tearing down the beautiful Art Deco dept. store, Bonwit Teller) he was able to convince the likes of Steven Spielberg, Johnny Carson and Sophia Loren to pay big bucks to live in the place, with units selling for as much as $15 million.
Today, thanks to his name over the door, the building is the least desirable place for the rich and famous to be seen entering. And they are exiting as fast as they can –at a loss.
Bloomberg reports that since Trump was elected, at least 13 condos in the tower have been sold. Among the nine for which property records show the original purchase price, eight were unloaded at an inflation-adjusted loss, with several selling at a discount of more than 20 percent. (By contrast, just 0.23 percent of homes sold in Manhattan during the same period booked a loss.)
Michael Sklar, who sold his parents’ unit for $1.83 million last October after they bought it for $1.4 million and spent $400,000 on renovations, summed it up,
“The name on the building became a problem. . . No one wants in that building.”
Another real-estate agent told reporter Shahien Nasiripour that clients told him NOT to show them units in ANY of Trump’s buildings. It’s a similar situation at Trump properties around the world—last year, Jeffrey Rabiea, who owns three units in the Trump Panama hotel and was part of a group fighting to have the name removed, told The Washington Post:
“It’s a bloodbath, basically. It’s a financial bloodbath. . . . Nobody wants to go there. If you’ve got a Marriott and a Hyatt and a Trump, you’re not going to Trump.”
It’s not just the residential area of Trump’s properties that are taking a hit:
The commercial portion of the building has been struggling for months to find tenants for more than 42,000 square feet of vacant office space, despite advertising rents well below the area’s average, listings and data from real-estate brokers show. . . . “If I were looking for office space, that would be a building I’d want to avoid,” said Edward Son, until recently a market analyst for CoStar Group, Inc.
And according to disclosures to investors, one of the building’s other problems is that Trump hasn’t spent much money updating the tower in recent years.
Barbara Res, a former Trump Organization executive, told Bloomberg.
“I don’t think I would want an office in Trump Tower. Why would you go there? It’s a wonder he doesn’t have 50 percent vacancy.”
(Photos, City Realty, Wikimedia; via Vanity Fair)