November 3, 2016 ~ Lisa Lindo
Trump Tower Toronto Now Bankrupt
Donald Trump and the late Rob Ford, then mayor of Toronto, shake hands at the
grand opening of his new Trump International Hotel & Tower in Toronto
(Photo by Kevin Van Paassen/The Globe and Mail, 2012)
Let's be Clear
Like many things with Trump's name on it, Donald Trump didn't own this hotel/condo property in Toronto. Trump Tower Toronto belongs to Talon Developments. Four years ago, they licensed the Trump brand for their skyscraper and hired Trump to run the property. The Trump Organization was only responsible for managing the place. We say "was" because - as of May, 2016 - Talon’s clients were “no longer interested in the Trump brand.” They want nothing to do with Trump at all and they've gone to court to formalize the separation agreement. Why? Because they feel Trump himself has damaged his name beyond repair.
Toronto is one of the world's most multi-cultural cities. There is a balanced beauty to our peaceful northern neighbor's sprawling melting pot of a town. For the past few months, however, its residents have passionately begun to respond to the many comments and dog whistles made by America's Republican candidate Donald J. Trump. Donald's oft repeated rhetoric against immigrants and Muslims has echoed around the world. In many pockets where fear has replaced reason, his message of Nationalism and wall building sounds attractive. To the rest of us, his fear mongering techniques are downright disgusting, and as a direct result of how Donald has managed his own behavior throughout his presidential bid, Trump properties/hotels across Canada have become targets for protests.
He's So Busy Losing, Has He Noticed?
It is hard to tell if Trump cares about how many people react negatively to his campaigning style. Throughout Trump's run he has smashed and destroyed one longstanding American political campaign ritual after another. For months, while this inexperienced buffoon has been marauding around with his sordid variety of late night rants and road show vaudeville speeches, he seems to have taken little notice of the ripple effects of his behavior. Since he doesn't show any signs of pivoting, and has in fact ramped up his skeeviness in the last couple of weeks, it has become clear that Trump doesn't think any of the short-term drama, hate, and violent bigotry he's stirred up could do him any harm in the long run. After all, Donald's always been a believer in the old adage that all publicity is good publicity because the more people that simply know his brand, the more customers he can reach for whatever he's currently selling. So, if Trump needs to be radically controversial to keep getting the air time for free, so be it - brand licensing agreements be damned.
All's Not Well That Ends in Bankruptcy
Unfortunately for Trump, many of the properties he's associated with around the world don't agree with this philosophy. In fact, it would appear Trump's toxic behavior has been steadily tainting his brand around the world throughout the process - pushing business away as he builds his twitter followers. Those who have paid top dollar to license his name - and agree to his new management contracts and fee schedule - are little disappointed with what they are getting for their money.
That Time You Strategically Aligned Your Brand with the Word 'Deplorable'
He's Horrible at his Old Job
To be fair, for some of Donald's holdings seeking to peel away from the Trump name it isn't only about his behavior on the stump. It's about his behavior at his day job. Yeah sure, there are protesters surrounding his Canadian buildings making it uncomfortable for residents and visitors to want to be seen near the place, but in the case of Trump Tower Toronto, for instance, reports are that there's a little matter of management deficiencies at the site itself that has caused a rift.
Turns out Talon Developments deeply regret their choice to add Trump's name to the building. It appears that the branding opportunity came with a pay to play management contract requiring that the Trump Organization manage the venture - for a fee. As so typical of most Trump properties, Trump Tower Toronto has been slowly bled dry with management fees while the Trump Organization's actual handling of its management responsibilities have driven the property into bankruptcy only four years after opening. The developers, Talon Developments, has had to sue to get Trump's name and likeness off the property.
He Ran for President Because He's Imploding Globally
In an interview with The Toronto Star, Trump Tower's company lawyer Symon Zucker lamented, “It’s more important for him (Trump) to be president than run a successful business." Well, ok that's understandable. It's a big job running for President, so many interviews, so many campaign stops, so many people to meet and greet. It takes a person with true stamina and determination. Much like the position itself, running for the office of the President of the United States (POTUS) is a full-time job complete with 3 a.m. tweeting and everything. But Trump knew that going in. And the Trump Organization is much bigger than him, so his massive and muscular "organization" should be able to handle things while he's been on the road, glad handing the public and pointing out black people at his rallies.
Turning Those Campaign Donations into Income
It is important to note here that just this year Trump Taj Mahal in Atlantic City has closed its doors and now Trump Tower Toronto has fallen into bankruptcy. The Donald's footprint is shrinking. It just makes sense that the 2016 election cycle - with hundreds of millions of dollars being spent monthly - would look like quite a nice take home fee to someone like Donald. Historically there is certainly a lot of money to be made in running for President if that money is spent wisely. There’s even money in losing. That’s right, even if Trump loses the election, he definitely is gonna come out a winner financially. Of course, the man told us all along that he's greedy, greedy, greedy so there really shouldn't be any surprise to find out that one-fifth of all money raised by his campaign is being spent on Trump company products and services. He's said publicly that if he loses this would all have been a waste of time, but the truth is he's made a living. He's said publicly that he has spent $100 million of his own money on the campaign, but the truth is he has fund raised like crazy all along, will only have spent around $35 million when it is said and done, and that money is just a loan to the campaign he'll get repaid, with interest, on November 9th.
Just A Lover's Quarrel
Of course, Trump’s empire might suffer as his attentions are elsewhere. There are bound to be some adjustments that need to be made as he transitions into greatness and passes the baton of Trumpiness down to his various children to run. And that’s probably not that big of a deal because - as we discovered - most of Trump’s “properties” are really just buildings where the true owners have licensed the Trump name to make their towers seem more attractive. Often, as part of the licensing deal, Trump also makes money taking on the “management” of these properties. Who better to manage a building with the Trump name on it than Trump, right? It’s a no brainer. Unless of course that manager is distracted by running for POTUS.
Unfortunately - when we peek back inside Trump's ongoing 5-star tower struggle - things are not going so well in the transition department with our neighbors to the north. The Toronto property's actual developer is fighting to escape The Donald and what it sees as a seriously tainted brand. Like a stalky ex you can't seem to shake, Trump’s management company is not going quietly.
Sure, in the beginning, the billionaire businessman made numerous appearances in Toronto to promote the 65-story hotel and condo tower, but the project was problematic from the get-go. A year after it opened, under management from The Trump Organization, the hotel's room occupancy was at 50%, and rooms were only fetching half the projected rate. That wasn't just a problem for the property owners, but also a problem for the investor-owners who bought individual hotel rooms in the tower as speculated ventures. Those Talon Development investor tenants end up losing the equivalent of about $175 a day and hope Trump's name off of the building will help stop the bleeding. They’re even taking it to court as the building is now the subject of a Canadian lawsuit against Trump and associates by disgruntled investors who say they were misled in their deals.
According to the Financial Post, management problems and security issues have been bringing down the property values on Trump Tower Toronto too rapidly to give accurate numbers. "The values of the individual units are in freefall," says Alex Schnaider, Talon's Chairman who is currently attempting to sell the building, adding "any new owner, would, of course, be free to change the building’s name." The Financial Post says spokespeople for Talon declined to comment on the specifics of any potential deal.
Both the Toronto Trump Tower and the Vancouver Trump Tower have been the target of protests for months ever since Trump’s controversial remarks about Mexican migrants, as well as the presidential candidate's call for a ban on Muslims entering the United States. Municipal politicians in both northern cities called for the Trump towers to be renamed, as did a majority of Canadians in a poll in the fall of 2015.
And it All Comes Tumbling Down for Donald
According to Politico, "Today a Canadian Bankruptcy judge placed the glass-and-granite building into receivership, just four years after Trump and his children cut the ribbon at its grand opening. Once it’s auctioned off, whether Trump is the leader of the free world by then, his name may well vanish from its marquee." CBC News is reporting, "Judge in the case has ok'd the sale of the hotel-condo tower and investors are suing the project's developers, saying they were misled about its finances."
Five More Days
We are still researching, one by one, each of the projects Trumps has overseen. We must say, in all earnestness, that we have yet to look into a Trump property to find it was managed properly. In stark contrast, we find repeatedly that Trump has blatantly mismanaged his portfolio and systematically - in some form or another - used these business ventures as a means to defraud and default the public. We can't say it any plainer.