PHOTO: Donald and Melania Trump. FILE
Long-time real estate investor Donald Trump may face the potential loss of approximately $250 million (equivalent to $392 million in Australian dollars) worth of property if he loses his civil fraud case in New York.
For decades before his presidency, Donald Trump was closely associated with the real estate industry, especially his iconic New York properties, which have recently come under intense scrutiny.
This situation emerged when New York Judge Arthur F. Engoron of the state Supreme Court issued a comprehensive 35-page judgment, concluding that Trump had inflated the value of his assets to secure more favorable loan and insurance terms from financial institutions.
Donald Trump artificially boosted his wealth by billions through fraudulent means
According to a report in the New York Post, Judge Engoron’s decision was part of New York State Attorney General Letitia James’ $250 million civil fraud case against the former president, his company, and key executives. If this ruling ultimately stands, Trump could lose control over several well-known properties in New York City bearing his name. The high-profile trial commenced on Monday, with Trump’s lawyer, Christopher Kise, arguing in opening remarks that the defendants did not intend to deceive anyone regarding property values. He emphasized that differing views on property values are inherent to the real estate market, with buyers and sellers each having their perspectives.
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Trump’s legal team, as well as a real estate industry expert, also contended that James’ lawsuit did not properly account for the value of the Trump brand or subjective valuations, which often result in varying estimates from lenders and borrowers. An industry insider even pointed out, “Nothing is out of the realm in New York City. Have you seen property prices lately? You have a simple penthouse going for [$195] million. So I cannot give you an exact estimate of what all Trump’s Manhattan properties are worth … Estimates in New York have always been subjective.”
Currently, about a dozen properties owned or partially controlled by Trump and his business are at stake. Here is a closer look at some of them:
- Trump Tower, located at 721 Fifth Ave. in Midtown Manhattan, is a 58-story skyscraper that has been a prominent fixture since its completion in 1983. It serves as the central headquarters of the Trump Organization and houses apartments, offices, and stores. The Attorney General’s suit alleges that deceptive practices were used to overvalue the tower, including basing its value on a nearby transaction that was reported as setting a world record.
- Trump Park Avenue, situated at 502 Fifth Ave., was transformed into a residential building in 2004. Trump purchased the property for $115 million and converted it into 120 luxury homes. The lawsuit contends that the organization overvalued rent-stabilized rental units in the building.
- 4-6 E. 57th St., the former Niketown location, was valued at $445 million in 2019. The lawsuit claims this sum was inflated by mismatching income and expense periods.
- 40 Wall St., a 71-story commercial skyscraper in the Financial District, had a 2015 appraisal of $735.4 million by the Trump Organization, while a lender-ordered appraisal was $540 million. The lawsuit alleges that the valuation included a lease that had not been signed and understated building expenses.
- 1290 Ave. of the Americas, located in Midtown, is co-owned by Trump. The organization is accused of using a questionable method to calculate the building’s value, potentially inflating it.
- Trump National Golf Club Hudson Valley, near Poughkeepsie, faced allegations of inflating the cost of memberships to boost property value.
- Seven Springs, a 212-acre property in Westchester County, was the subject of inflated valuations, especially regarding planned luxury residences.
- Trump National Golf Club Westchester in Briarcliff Manor is accused of inflating its value by including income projections from new members who did not actually join.
Trump building – 40 Wall Street New York City.
Donald Trump could give up a huge chunk of his real estate portfolio if he loses his civil fraud case. Pictures: Getty
These legal proceedings have far-reaching implications for Trump’s property holdings and could potentially result in significant financial losses if the allegations are upheld in court.