Trump lost $ 70 million at DC hotel, despite shady deals, documents reveal
WASHINGTON – On the day he took office, Donald Trump was the most ethically and financially troubled president in modern history. He refused to divest his private business holdings, which meant that foreign dignitaries, corporate CEOs and others who spent money at Trump’s hotels and resorts were putting money in his pocket and allowed Trump to leverage his public service for private profit. . The maze of limited liability companies and holding companies under Trump’s control has made it nearly impossible to know the truth about the Commander-in-Chief’s vast financial dealings.
New explosive findings released by Congress confirm fears of legal experts who have warned Trump’s business relationship was an ethical minefield for a sitting president. These finds focus on the crown jewel of Trump’s real estate empire – his luxury hotel in Washington, DC.
A 27 page letter published by two top Democrats on the House Oversight Committee, claims Trump misled the public about his Washington hotel’s finances, disclosing hotel revenue without revealing that he actually suffered net losses over $ 70 million. The congressional report also says Trump renegotiated a $ 170 million loan with Deutsche Bank to delay payments for six years – a favorable deal he also did not fully disclose to the public.
The new Congressional report builds on hundreds of pages of new documents obtained from the government agency that oversaw the Trump DC hotel lease. These documents reveal that foreign governments spent $ 3.7 million at Trump’s DC hotel between 2017 and 2020 – an amount, according to the oversight committee, that would be enough to pay for nearly 7,500 nights at the hotel based on publicly available room rates. These foreign payments raise questions about whether Trump has repeatedly violated a key anti-corruption provision in the Constitution.
“This new evidence raises many questions that require further investigation and action by the Committee,” wrote Reps Carolyn Maloney (DN.Y.) and Gerry Connolly (D-Va.) In the letter.
Spokesmen for Trump and the Trump Organization did not immediately respond to requests for comment on the oversight committee’s findings.
The Trump International Hotel in Washington opened its doors in September 2016, a few months before candidate Trump won that year’s presidential election. The hotel quickly transformed into a sparkling clubhouse for the new president’s assistants and advisers: enter on a weekday evening and you could see Donald Trump Jr. and former campaign leader Brad Parscale are lounging at the bar, Treasury Secretary Steven Mnuchin jostling in the lobby or Rudy Giuliani courting at BLT Prime, where Trump had his own table.
The Trump Hotel in Washington was also a magnet for domestic and foreign interests seeking to curry favor with the Trump administration. T-Mobile CEO John Legere paced the hotel in his signature hot pink T-shirt; according to a congressional investigation, Legere and other company officials have spent $ 195,000 there on hotel rooms and other expenses since T-Mobile asked the administration to approve a massive $ 26 billion merger with Sprint. The hotel was also a hotspot for foreign governments, who rented ballrooms to throw parties and in doing so put money in the President’s coffers.
There was no precedent for a sitting president owning a luxury hotel down the street from the White House, and Trump has taken little concrete action to separate his financial interests from those of the hotel. The hotel then became the perfect vehicle to funnel money to Trump and gain his favor in the process. As a public market told me in 2017, a foreign government hoping to win Trump could book a hotel ballroom without even worrying about hosting the event. “It’s a win-win”, the expert, Steven Schooner, noted. “If you are using the space, you are entertaining people on the President’s property, and if you don’t, you have just funneled the money to the President and the President’s family.”
Yet even with such an easy way to put money in Trump’s hands, the Trump Organization struggled to turn the DC hotel into a for-profit machine. Throughout his presidency, Trump has said in his annual personal financial statements that the Trump DC hotel is making a lot of money for him and his family – over $ 156 million in revenue between 2017 and 2020. But according to the news Congressional findings, the hotel’s financial health was quite dire.
According to the new House Oversight Committee report, Trump Audited financial statements show that the property “supported a report loss of $ 2.5 million to $ 22 million each year, for a total loss of over $ 73 million from 2016 to 2020. ”In other words, the hotel wasn’t collecting money like that seemed from the outside; it was bleeding money. And according to the committee, that was true even before the Covid-19 pandemic crushed the hospitality industry at large. The financial condition of the Trump DC hotel was so precarious that a separate legal entity from Trump loaned the hotel $ 27 million from 2017 to 2020. Most of that money was ultimately not repaid, according to the committee. find.
“Taken together, these documents show that far from a successful investment, the Trump Hotel was a failing company with debts that required bailouts from President Trump’s other companies,” the letter from the oversight committee reads. “In deciding to conceal the true financial situation of the Trump Hotel from federal ethics officials and the American public, President Trump has concealed conflicts of interest arising not only from his ownership of the hotel, but also from its roles as hotel lender and guarantor of its third-party loans.
The financial shortcomings discovered by the supervisory committee do not stop there. According to the committee, one of Trump’s main lenders, Deutsche Bank, agreed in 2018 to renegotiate a $ 170 million construction loan for the DC hotel. Under the new terms, Trump could defer loan principal payments for six years. The postponement not only saved the hotel from spending millions of dollars on loan repayments; it also took a lot of pressure off Trump himself, who had personally guaranteed the Deutsche loan, according to Congress.
There is one particular detail about Trump’s Deutsche loan that caught the attention of the oversight committee. According to the committee, the Trump Hotel in DC drew $ 31 million from the Deutsche construction loan in August 2016, even though the hotel opened a month later. Congressional investigators said it was “not clear how this large sum of money was used during this period, nor how it was accounted for in the hotel’s annual financial statements.” The oversight committee letter also states that Trump did not publicly disclose the withdrawal of $ 31 million on that loan, and the documents obtained by the committee “do not fully reflect how the funds were used.” .
After years of sounding the alarm bells over Trump’s numerous conflicts of interest, the latest findings of the oversight committee validate concerns voiced by ethics and transparency advocates that Trump’s hotel may be used as an intermediary for foreign money. While there have been numerous reports of foreign dignitaries spending money at the Trump DC Hotel, the oversight committee’s findings potentially offer the full accounting of these expenses abroad – over $ 3.7 million from 2017 to 2019.
Using the average daily hotel room rate, this amount of money could be used to purchase 7,433 nights. This translates into a stay of over 20 years at the Trump’s DC Hotel.
Representatives Maloney and Connelly said in their report that they plan to continue investigating Trump’s hotel in Washington and how the General Services Administration handled the hotel’s lease. They asked for more documents related to Trump’s loan to Deutsche Bank, spending by foreign governments and GSA’s lease with Trump, saying the additional information will help “address the unresolved ethical crisis left by the former President Trump and prevent future presidents from profiting from the presidency. “