Not only is Donald Trump omnipresent in the current political discussion, but so, too,
been around in New York City for decades before his reality TV splash.
Recently, I’ve started to get some interesting questions related to The Donald:
- Is there a discount to purchase in a Trump-branded building because he’s so horrible?
- Do some people hate him so much that they wouldn’t buy in a Trump-branded building?
- Are his buildings better or worse than others?
- Does he make any money from
or have a part in any of the buildings that feature his name?
First things first: I don’t think
there is any buy-side discount because Trump is currently out of favor in New York (or in favor anywhere else).
Second, property inventory is so tight that
I don’t think a buyer would exclude any property for a name on the marquee.
Some buyers don’t like the details of Trump International, or his building at 200 East 69th Street, but overall, the quality of his lobbies certainly is
equal to or better than much of what competes.
His buildings put in great amenities at a time
in the 80’s when others might have been value engineering a bit too much.
Trump understood and still understands the luxury product, and even if you hate him, Donald Trump was quite the visionary in many ways, all related to Real Estate.
He licensed his name to
numerous buildings over the last 30+ years, whether he had a hand in their development or not.
He still makes money from his residential management and brokerage companies, and, I would guess, from the buildings
to which he licensed his name and wasn’t involved in the construction.
This licensing later included the Far West Side, from 58th to 72nd Streets, a massive parcel of land in the last stages of completion now, some thirty years after he wrote about it in his fun book The Art of the Deal.
In that 1987 book, he talks about how he initially was able to
secure various tracts across the city, including what had been dubbed “Television City.”
The timeliest is what became Riverside Boulevard, which he controlled, then either lost or let go; he then licensed his name to a Japanese consortium.
One West End and
One Riverside are but
two of almost 20 buildings in the tract that is transforming the Southernmost portion of the West Side.
Stepping away from these deals, Trump was at the forefront of a number of marketing ideas and structures which have become more commonplace today.
These include (1) creative floor numbering, (2) creative use of square footage, (3) use of land leases to build residential, (4) building one bedrooms with the extra half bathroom, (5) not to mention sophisticated marketing campaigns for his real estate.
I feel this is akin to showing a child a black and white movie like Citizen Kane and trying to explain why it was so groundbreaking.
Trump’s genius was in the freedom he took
to call the 15th floor the 30th floor, or to call 600 square feet 800 square feet, and define it thus in the offering plan.
What do I mean?
It might seem obvious, but if you want to call the 35th floor the 70th floor, all you need to do is change the numbering in the elevator.
A 60-story building all of a sudden has a 90th floor!
The same goes for square footage, which subtly became a marketing number rather than a mathematical definition, under Trump’s deft skills.
Nowadays, every new development employs creativity in defining square footage, some more deftly than others.
I’ve seen condominiums
incorporate basement storage space into the square footage of an apartment, or include the elevator which opens into the space, or measure from the outside walls.
Trump was among the first, if not THE first, to go whole hog into the redefinition of square footage.
Trump’s famous use of the land lease was featured in a great article in The New York Times in June.
In essence, the owners of that cooperative, which functions like a condominium (known as the “Cond-op”) had a very high rent to pay to the entity that owned the land under the building.
The M.O. for Trump certainly had been to negotiate well, to do what it took to get a building built.
This building on 61st Street and 3rd ultimately bought its
underlying land, but had to pay dearly for it.
He understood that location came first.
What came second?
Trump’s keen understanding of his customers allowed him to begin building half baths, aka powder rooms, even in one bedroom apartments.
When other builders were creating apartments, he was building luxury homes, properties that had worldwide appeal, years before New York City became the urban Disneyland we know it to be now.
Incredible, if glitzy, lobbies, a very, very high level of service, to which he attributes credit to his ex-wife Ivana in his 1987 book.
Now, his daughter Ivanka has picked up that keen understanding in creating trophy properties like the Puck Penthouses.
But in buildings like 200 and 220 Riverside Boulevard, The Donald even in the late ’90’s and early 2000’s understood how to make his properties stand out.
Lastly, let’s talk about his marketing.
No one can argue that Trump is not a marketing master.
Sure, he has terrible hair, says truly awful things about immigrants and others, and will not become our next president.
But he can create a sophisticated marketing campaign for his buildings, a down and dirty campaign for his politics, and either way
create a massive buzz around himself.
As technology has allowed new buildings really to
take their sales offices to the next level, Trump had been light years ahead in crafting slick and compelling copy for prospective buyers, allowing him to achieve record prices and success.
I wish he would stick to Real Estate, but then we wouldn’t have anything fun to talk about, would we?