Donald Trump has been accused of overstating the value of the marquee Trump Tower, on Manhattan’s Fifth Avenue, according to a recent article in Forbes.
The Trump Organization is embroiled in a $250 million civil lawsuit alleging fraud filed by the New York attorney general in September. Attorney General Letitia James, a Democrat, alleged the organization inflated the value of the former president’s real estate empire by billions of dollars to receive loans and insurance with favorable terms and for tax benefits. The Manhattan district attorney, Alvin Bragg, a Democrat, is also investigating the tower.
Since Trump Tower opened its golden entrance in 1983, Trump hasn’t been truthful about the building’s financial performance, according to records viewed by Forbes.
For example, Trump told Forbes that 85% of the residential units were sold before the building opened for between $500,000 and $12 million. However, financial records indicate that only 60% of the apartments were sold in 1983—and 87% were purchased for under $500,000, according to a Forbes review of property deeds. The most expensive unit that went under contract was for $2 million—about $10 million less than Trump had claimed.
He also misstated the size of the building’s office and retail space and overall commercial square footage.
The Trump Organization denied these claims to Forbes.
“The attorney general’s attempt to interfere with private loan transactions between sophisticated business parties is utterly baseless and a complete overreach,” the Trump Organization told Forbes in a statement. “Not only was there never a loan default, but all the loans are either current or have been completely paid back in full in the ordinary course of business. Indeed, all of the Wall Street banks that issued these loans profited handsomely.”
It isn’t uncommon for real estate honchos to exaggerate or underestimate their holdings, but it’s typically not this “blatant” or “extreme,” says a New York City real estate expert.
When Trump Tower opened, the former president claimed it was “the most successful real estate development of recent times.”
But at 40 years old, Trump Tower is no longer considered a top-tier Manhattan luxury building, says the real estate expert. The lobby, filled with brass, plants, and pink marble, is “dated” and more of an upper-middle-class condo building than the status symbol it was in the 1980s, says the real estate exert.
Trump’s foray into politics appears to have affected his real estate deals. Sales at his properties were up, but prices had fallen, in much of the country, according to a 2021 Realtor.com analysis.
Nearly a dozen apartments in the building are currently for sale, ranging from about $1.6 million to $6 million. Rentals range from about $6,500 to $30,000 a month.
