Zero investments does not mean Donald Trump has no relationships with powerful Russians. It has become clear that Donald Trump has known and tried to benefit big time in Russian investments and eyed investments in Russia for quite awhile.
The Trump International Beach Resort in Sunny Isle, Florida, may be witness to this. Sunny Isle is a dominant wealthy Russian neighborhood on Florida’s coast with the Trump Hotel and Residence in the center of it all.
Here is an article eTurboNews published on September 15, 2008 after eTN Reporter Hazel Heyer from Orlando, Florida, talked to Donald Trump Jr.
Last week this article was mentioned by major US media including CNN, the Washington Post, BNE, and The Today Show.
This is the eTN story:
The executive vice president of Development and Acquisitions for the Trump Organization, Donald Trump Jr., is the eldest child and son of famed real estate developer Donald Trump and his first wife Ivana Trump. He currently works with his siblings in buying, selling and franchising prime commercial real estate including hotel towers spanning the entire globe, from the US to Dubai.
Trump, Jr. began work for the Trump Organization on projects such as the West Side Yards and Trump Place on Riverside Drive. Recently, he has focused on the redevelopment of the old Delmonico Hotel and the Trump International Hotel and Tower Chicago project seen on television show The Apprentice.
At the recent Cityscape USA’s Bridging US and the Emerging Real Estate Markets Conference held in Manhattan, Don Jr. (as he is fondly called) revealed his company’s serious intent in getting into the emerging markets world over.
For Trump, Russia is the emerging market worth investing in currently, however in caveat into the high-end sector he counts on his international experience in the market. Trump said: “The emerging world in general attributes such brand premium to real estate that we are looking all over the place, primarily Russia. There are countries that have not been fully tapped by us such as Thailand, Vietnam and Argentina. We are currently looking at potential deals. Our interest is really everywhere because there is a lot of new money in the emerging markets which appeal to certain brands whether ego-driven or having the life-jacket effect that we feel gives added-value to our investment.” According to him, he has been to basically all the emerging markets in the last six months or this summer searching for good deals.
If he were to choose his top A-list for investments in the emerging world, Trump said his firm would choose China and Russia. “Given what I’ve seen in Russia’s real estate market as of late relative to some of the emerging markets, the country seems to have a lot more natural strength, especially in the high-end sector where people focus on price per square-meter,” he said.
“In Russia, I really prefer Moscow over all cities in the world. Unlike other countries in the world, this country has five major cities where people would at least be happy being close to living in the metro.
“In Russia, if one has made money anywhere in the country, you would want your place in Moscow.”
However, to a certain degree, some US investors have had concerns over Russia. “Well, that’s happening, too. After spending half a dozen trips to Russia in the last 18 months, several buyers have been attracted to our projects there and everything associated therewith. But it is definitely not an issue of being able to find a deal – but an issue of ‘Will I ever see my money back out of that deal or can I actually trust the person I am doing the deal with?’ As much as we want to take our business over there, Russia is just a different world. Though the legal structure is in place for what we have today, and even 99 percent is covered, that 1 percent not covered could be 100 percent covered over there because it is a question of who knows who, whose brother is paying off who, etc.,” Trump said, adding, “It really is a scary place.”
Despite a current government that projects a ramrod posture, to Trump the current leaders even make the scene more scary. Holding back his grin, he said, “It’s so transparent – everything’s so interconnected that it really does not matter what is supposed to happen as what it is they want to happen is ultimately what happens.” He has had multiple deals but he’s open with his partners despite what it is that keeps him up at night has to do with knowing that he has to face the “issues forever including money coming back…or not.
“And in terms of high-end product influx into the US, Russians make up a pretty disproportionate cross-section of a lot of our assets; say in Dubai, and certainly with our project in SoHo and anywhere in New York. We see a lot of money pouring in from Russia. There’s indeed a lot of money coming for new-builds and resale reflecting a trend in the Russian economy and, of course, the weak dollar versus the ruble,” he said.
Trump Jr. also oversees the Trump International Hotel and Tower SoHo project along with The Apprentice reality show winner Sean Yazbeck. The organization has launched last year the sale of penthouses in the Trump SoHo Hotel Condominium in New York in the UAE market. This property is the only luxury hotel condo in Manhattan’s fashionable SoHo neighborhood.
Aside from the former Soviet state, India is also another place in which Trump thinks investment opportunities are ripe. He said that he likes India as much as China. But he said, “I don’t know if there’s much growth potential as China’s. Yet at the same time, with India gaining some of the benefits of colonial rule for a long time, India’s legal structure is a little simpler for Western investors to get in. It has a different mentality while there is still natural corruption like we see in many emerging markets. India, I think, is a little bit more refined than China and Russia which remain the Wild West.”
From a boutique perspective, Trump Jr. said they would like to expand their hotel brands and spend much time focusing on the management side. “We tend to look at Vietnam and we’re doing a couple of projects in Thailand. We’ve had incredible focus too in the Middle East, launching in Dubai with a force to reckon with,” he said.
The Trump Organization and Nakheel Properties, the developer of more than $30 billion in real estate in Dubai, have signed a deal in October 2005 creating Trump’s International Hotel and Tower. Both companies have invested substantially in the pioneering $US600 million development spread across a portfolio of eight hotels and resorts including the 800-unit condo-hotel of the US mogul. Trump’s tower is the initial development in Nakheel and The Trump Organization’s exclusive joint venture in the Middle East. Further, Trump Organization’s agreement with Nakheel includes exclusive rights for 19 countries in the Middle East region and 17 major brands.