The Home Equity Theft Reporter Cases & Articles: Trump 'Name-Renting' Scheme Used To Jack-Up Prices On Beach Condos Leaves Investors Headed For The Courts

Friday, May 20, 2011

In Fort Lauderdale, Florida, The Miami Herald reports:

Another vacant season winds to an end for the grand hotel formerly known as Trump. The yellow and blue tower, one of the few modern structures in Broward County designed by a world renown architect, should have been the throbbing heart of the renaissance on Fort Lauderdale Beach.

It’s empty. As empty, perhaps, as the Trump brand that was used to lure investors into a condominium-hotel scheme that would collapse before a single guest signed the register. The architectural flourishes of the 24-story building, with great portholes looking out over A1A, were meant to evoke the old fashioned “elegance and grace of the luxury ocean cruise liners.” In retrospect, maybe the Titanic.

More than 100 investors bought into the 248-room project in 2005 and early 2006, putting 20 percent down for units priced between $500,000 to $3 million.

Lawyer Joseph E. Altschul, who represents purchasers holding stakes in some 50 units, said his clients had bought into that Donald Trump allure. The Trump name. The Trump luxury hotel network. And they paid, he said, about $200 more per square foot over comparable condo-hotel projects along the beach for that magical Trump name.

Preconstruction brochures assured buyers that “Mr. Trump is committed to personal and direct involvement in everything that this name represents.”

Not so much, as it turned out. Two years ago, when the project fell into foreclosure, Trump told the Sun-Sentinel, “We have nothing to do with the building. We had a licensing deal, and we terminated the licensing deal a long time ago.”

Altschul said his clients were shocked to learn that the famous name used to jack up the prices on investment packages for a luxury hotel project was just another cheesy Trump marketing deal. “Trump International” carried no more meaning then the logo fixed on Trump shirts, Trump suits, Trump ties, Trump chocolate bars (“Each bar is packaged in a beautiful and luxurious gold, silver, or copper casing”) Trump crystal, steaks, vodka, lamps, bottled water, mattresses. And, of course, “Donald Trump by Donald Trump,” which turns out to be a fragrance. Spray it on for “citrus notes with hints of mint, cucumber and black basil.” And the subtle whisper of mendacity.

The New York Times reported Friday that would-be condo buyers who lost hefty deposits in two other Trump buildings, condos in Tampa and Baja California, were similarly stunned to learn that the failed projects were “Trump” in name only. Trump’s lawyers pointed out that if the buyers had closely examined the sales contracts, they would have found the obtuse language indicating that The Donald was only the front man in someone else’s real estate deal.

He rented his name to the Tampa project for $4 million and a cut of the never-to-be profits. (The Times also reported that consumer complaints and lawsuits were piling up against the unaccredited but very expensive Trump University, with its courses in get-rich-like-me real estate and deal making.)

So the Trump International on Fort Lauderdale Beach was no more authentic than the would-be presidential candidate’s descent into the birther conspiracy. Just a famous name attached to an empty lie.