By David A. Fahrenthold and Jonathan O’Connell / The Washington Post
Late last year, the owners of the Trump International Hotel in Panama made a decision: They no longer wanted to be a Trump hotel. The owners told President Donald Trump’s company they were terminating its management contract.
Last week, the Trump Organization responded with a stern warning.
The company is not walking away, a Trump official wrote. And the owners would regret picking this fight.
“When Trump Hotels prevails,” the company wrote in a letter, the owners “will have millions of dollars in financial liability.”
Since the 2016 election, Trump’s company has found itself in an unfamiliar role: not selling the Trump brand, but trying to save it from condo owners and unhappy partners seeking to shed the president’s name. The Trump Organization has fired back — at times with legal threats.
The root of the disputes is a growing belief among investors in some locales that the Trump brand has turned from an asset to a liability.
“It’s a bloodbath, basically. It’s a financial bloodbath,” said Jeffrey Rabiea, a New York businessman who owns three hotel rooms in the Trump Panama hotel. Like other owners in the building, he blames the Trump company for mismanagement and attributes the low occupancy rates in part to the president’s polarizing brand. “Nobody wants to go there. If you’ve got a Marriott and a Hyatt and a Trump, you’re not going to Trump.”
Eric Trump, one of the president’s sons who is helping run the Trump Organization in his absence, declined to comment on its handling of properties seeking to drop their Trump affiliation. Company officials have blamed other factors such as broader market conditions for the poor performance of some Trump-branded buildings.
Since Election Day, the Trump name has already been removed from luxury hotels in New York, Rio de Janeiro and Toronto, along with three apartment buildings in New York.
Behind the scenes, the Trump Organization has also issued warnings to at least three more properties: the Panama hotel and two condo buildings in New York, according to documents obtained by The Washington Post and people familiar with the efforts. The president’s company manages the three properties but does not own them.
Before the election, his company had expansive plans for his brand, which already adorned more than 50 properties worldwide. But then Trump won.
“We walked away from 47 international deals for the Trump brand,” Trump Hotels chief Eric Danziger said at a real estate conference in New York on Wednesday. “Those are things I worked on for a year, from Tel Aviv, China, Amsterdam, Frankfurt, Munich. But when he became president he said we will not be doing new business in any foreign country.”
Since then, the Trump name has gone up on two new properties — a hotel in Vancouver and a golf course in Dubai. Both had been in the works before the election. Other long-planned properties are under construction in Uruguay, India and Indonesia.
But the president’s company has been quietly losing ground on other fronts.
Just after the election, residents of three apartment buildings called “Trump Place” on Manhattan’s liberal Upper West Side petitioned the owners to remove the name. They did. (Trump had not owned the property for years.) The current owners said they wanted a “more neutral identity,” according to press reports.
Then the Trump Organization itself decided to pull out of the Trump hotel in Rio — a long-troubled property whose owner was wrapped up in a Brazilian corruption investigation.
Next to go was the “Trump Carousel” in New York’s Central Park.
The problem there: “It was never named Trump Carousel,” said Crystal Howard of the New York City parks department.
She said the Trump Organization — which had a contract to operate the attraction, whose name is the Friedsam Memorial Carousel — had simply put up a sign that renamed it “Trump Carousel.” The sign seems to have been up for months, but the city only learned of it in April 2017. Officials ordered the sign taken down that day.
Later in the year, the Trump Organization suffered a pair of much more painful blows: the loss of the Trump hotels in Toronto and Manhattan’s SoHo neighborhood. Both had opened to enormous fanfare, luxury outposts that were meant to make Trump’s name synonymous with urbane success. “Never settle,” the hotel key cards said.
But both were located in cities hostile to Trump’s brand of politics. In June, the owners of Trump Toronto said it would be renamed. A few months later, so did the owners of Trump SoHo — which had seen a drop in business from corporate clients and pro sports teams after Trump began his campaign.
Those decisions likely cost the Trump Organization hundreds of thousands in management fees: Trump Toronto alone brought in about $559,000 during 2016 and the first part of 2017, according to Trump’s financial disclosures.
In SoHo, the renamed hotel has already seen signs of business returning.
“People who had stopped staying with us for a while are now interested in coming back,” said Nicole Murano, a spokeswoman for the newly christened Dominick Hotel, which was the Trump SoHo until several weeks ago.
Meanwhile, signs that the value of the Trump name is slipping in some markets has sparked heated debates among condo residents who live in his branded buildings.
In Manhattan, where luxury condo prices are sliding, homes in the 11 Trump-branded buildings began falling even faster last year, according to research firm CityRealty. Trump buildings had overperformed the market until 2016, when the price per square foot fell 7 percent, significantly faster than units in other buildings.
“Our homes are worth more without the Trump name,” Laurence Weiss, a condo owner at New York’s Trump Palace high-rise, wrote to his neighbors last spring, seeking to drop it. He was trying to sell a penthouse apartment for $15.5 million. He couldn’t. Realtors said the name might be a factor, he said. One potential buyer said his teenage daughter wouldn’t live in a Trump building, Weiss said.
But he failed to persuade enough residents. Instead, some mocked him.
“I know this might upset you,” one woman wrote back, “but we are not naming the building the Hilary Palace. That queen is gone,” referring to Democratic presidential nominee Hillary Clinton.
Weiss eventually sold the penthouse for $7.4 million, half what he’d asked. He now lives in California.
But at other Trump-branded buildings, the idea of removing the name has gained more traction, with residents citing not just property values but their objections to walking under a large TRUMP sign every day.
“Take it off. Why? Because this man is a danger,” said Len Captan, a resident at Trump Tower in White Plains, New York, a Trump-managed condominium building. “I don’t want to be associated with a name like that.”
His condo board heard a few such complaints, enough to discuss the issue at a November meeting. A Trump attorney was present. She spoke up.
“We’re not going to sit idly by,” she said, according to the condo board’s president, Alan Neiditch. Her message, he said, was: “They would resist the effort” to rename the building.
“I mean, we don’t need more lawsuits,” Neiditch said. “No one wants to bring on problems. That’s not our job, is to make problems.”
In New York City, the Trump Organization came down even harder on another building considering a name change.
The property, at 200 Riverside Blvd., is also part of the “Trump Place” complex, where three neighboring buildings had been renamed in 2016. This building bears the same name, but has different ownership.
“It’s people who are trying to rent their places out. The name hurts them,” said one resident outside the building last week, requesting anonymity to avoid angering neighbors.
In its March 2000 agreement, the condo board agreed to pay just $1 to license the Trump name forever. The board concluded that the agreement didn’t say the building had to use the Trump name.
Then came a letter from the Trump Organization’s chief legal officer, Alan Garten.
Changing the name “would constitute a flagrant and material breach” of the license agreement, Garten wrote in March 2017. If the board moved to take it down, Garten wrote, the Trump Organization would have “no choice but to commence appropriate legal proceedings.”
Instead of backing down, the condo board took Trump to court.
On Jan. 5 of this year, it asked a state court to rule that the license agreement doesn’t obligate them to use the name if they don’t want to. The suit, still pending, was first reported by the New York Post.
The most contentious fight over the Trump name is now playing out in Panama, where the Trump International Hotel opened in 2011 in a soaring glass building that resembles a billowing sail.
The building is set up as a “hotel condo,” where the 369 hotel rooms are owned individually by investors. The Trump Organization manages the hotel for them.
When the hotel opened, experts on Panamanian hotels said, the Trump name helped.
Now it doesn’t.
“Trump got elected and hasn’t won too many friends in the Latino world. There is definitely a stigma on the name,” said Kent Davis, a realtor in Panama who manages units in the buildings. “Now there’s a lot of unhappy owners.”
The entire Panamanian hotel market has declined in recent years. Hotel occupancy rates fell from 57 percent in 2013 to 48 percent last year, according to the Panamanian government. But owners say Trump’s hotel has performed even worse: Rabiea, who owns three units, says he’s happy if they’re rented for 10 nights out of a month.
“The owners have to say, ‘Management company: Go,’ ” Rabiea said.
Last year, they did. The owners’ association — led by its biggest shareholder, a Miami investor named Orestes Fintiklis who bought 202 unsold units in 2017 – sought to terminate the Trump Organization’s contract, according to the letter sent to individual owners last week by a Trump Organization official.
The effort to eject the Trump Organization was first reported by The Associated Press. Fintiklis did not respond to requests for comment.
The Trump Organization made about $810,000 in management fees from the Panama hotel during 2016 and the first months of 2017, according to Trump’s financial disclosures from 2017. The company argued that the condo owners have no right to break the agreement because it has not expired.
Trump’s company said the case is now in arbitration.
“We’re not going anywhere,” Garten said in an interview this week. “We have a valid and enforceable management agreement and intend to keep our brand on the property.”
Fintiklis has responded with defiance, according to a letter he sent to condo owners that was obtainedby The Post.
“Having lost at least three properties [Trump’s company] is refusing to maintain its last shreds of dignity and peacefully vacate our property,” Fintiklis wrote to condo owners.
“It should be clear to all of us,” Fintiklis wrote, “that our investment has no future” with Trump’s brand on it.
The Washington Post’s Alice Crites, Josh Partlow and Anu Narayanswamy contributed to this report.