Like many business owners, former President Donald Trump has seen his holdings suffer throughout the Covid-19 pandemic, with travel restrictions sinking revenues at his hotels and golf resorts.
The storming of the U.S. Capitol on Jan. 6 has further damaged his empire, with some of his biggest business partners—from Signature Bank to Vornado Realty Trust to the PGA of America—pausing their dealings or severing their relationships with the Trump Organization in the wake of the event, which Trump has been accused of inciting.
This change in Trump’s fortunes extends to some of his residential real estate properties, some of which have experienced declining unit values since he was elected in 2016. Trump-branded units in buildings in Chicago, South Florida, and elsewhere in the U.S. still fetch a premium when compared to other luxury condos, according to an October 2020 Redfin report, but that premium was down to 9.7% from 22% in 2019 and 33.5% in 2016. According to its website, the Trump Organization owns 23 residential buildings in the U.S.
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Moreover, the median sales price of Trump-branded condos nationwide (except for New York City) dropped by 17% from 2016 to 2020, according to Redfin, whereas prices on comparable luxury condos dropped by 1.3%. Condos in buildings with the Trump name also spent longer on the market on average than non-Trump condos—118 days versus 78.
This trend seems to be speeding up in some areas, with owners of apartments in Trump buildings saying they are eager to offload their units but finding them hard to sell. CityRealty in New York reported that closing prices prior to Election Day on condos in the city’s nine Trump developments had fallen by 25% from 2016 to 2020, and that more owners were willing to sell at a loss. Since the election, CityRealty’s index shows that the average price per square foot of Trump condos has dipped further.
And in Chicago, sales prices of condos in Trump Tower have been on the downswing throughout his presidency; one agent remarked that after the 2020 election they “hit rock bottom.”
There are parts of the U.S., however, where values of Trump’s residential properties are holding steady or even on the upswing. Since their October report, half the sales of units in Trump buildings logged by Redfin have been in Florida, noted Daryl Fairweather, chief economist with Redfin. And agents in Sunny Isles, Florida say they’ve had no pushback from buyers about the branding of luxury condo towers like the Trump Royale—although recent closings there, too, reveal price cuts.
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New York City
Shortly following Trump’s election in 2016, the residents of several Trump-branded residential properties in the very Democratic city of New York voted to remove the president’s name from their building facades.
Many of those buildings, along Riverside Boulevard in Manhattan, were no longer owned by the Trump Organization, and removing the name seems to have benefited sellers. According to an UrbanDigs report, relative demand (the ratio of signed deals to new active deals) for units in ex-Trump-branded buildings has declined only slightly, from 44% in 2016 to 42% in 2020, compared to those in buildings that still bear the Trump name, which dropped from 38% to 23% over the same time period. The Trump Organization didn’t immediately return a request for comment.
Furthermore, the average price per square foot for apartments in Trump-branded buildings in Manhattan declined by 21.6% over the course of his presidency; for full-service Manhattan condos over the same time period, the drop was only 9%, UrbanDigs found.
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As of mid-February, the overall price per square foot of all transactions in Trump-branded condos was $1,375, a further decline since the election and Jan 6. Capitol riots. And of 10 recent sales of apartments in Trump buildings, eight closed below asking price, according to CityRealty’s index.
The former president has denied any wrongdoing in relation to the riots, and was acquitted by the U.S. Senate in his second impeachment trial.
A three-bedroom at 845 United Nations Plaza, for instance, sold last month for $4.99 million, down from $5.5 million when it was first listed in March 2020. And a one-bedroom at 200 Riverside Blvd, originally listed in October for $1.295 million, sold for $1.15 million in January.
Meanwhile, Manhattan’s luxury real estate sector has been showing signs of recovery recently, after significant sluggishness earlier in the pandemic. Over the course of a week in mid-February, 38 luxury condos valued at $4 million or more went into contract, according to the Olshan report, although the final sales price on these units was an average of 13%below the original asking price.
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In that sense, the price dips on Trump-branded condos are not unusual given the overall state of New York’s luxury condo sector. And these properties do have some factors in their favor, especially as the pandemic has encouraged New Yorkers to reconsider their priorities: More buyers are seeking out larger apartments, and many Trump properties are known for offering generous square footage in their units.
“What he built is not to be found elsewhere in the marketplace,” said Penny Toepfer, an agent with Compass who has sold over 100 apartments in Trump Palace on Manhattan’s Upper East Side and other Trump-branded buildings. “The layouts have split bedrooms, double exposures, terraces, gracious hallways.”
With buyers who feel reluctant about purchasing in a building owned by the Trump Organization, she tells them to give her twenty minutes to show the home, Ms. Toepfer said, and often, they are convinced after seeing the homes for themselves. She recently closed on an apartment in a Trump building for $200,000 above the original asking price.
“A lot of the time the person says to me, you’re 100% right. The space is used well, and people react to that,” Ms. Toepfer said. “And Donald Trump doesn’t live in any of these buildings—that’s not what this is about. These are homes, your oasis out of the concrete and craziness.”
At Trump Tower Chicago, sales were weak prior to last year’s election, and many sellers were even removing the Trump name from their listings. In 2015, 85% of listings mentioned the Trump connection; this dropped to 64% in 2016, and 57% in 2020.
Prices also took a hit during the demonstrations of last summer, when the Trump high-rise in the very Democratic-leaning city became a popular gathering site for protesters; in the aftermath, sales fell to an average of $566 per square foot, down 25% from 2019.
Some units currently for sale in the tower have been lingering on the market and are now offering price cuts, like this three-bedroom, originally listed for $3.49 million in June 2020 and now asking $2.99 million.
Like many other major cities, though, Chicago experienced an outmigration during the pandemic as buyers headed for the suburbs, leaving the downtown market especially weak. Some agents say that slow sales in Trump Tower these days are not particular to that building or necessarily a negative reaction to the Trump brand, but rather indicative of broader trends.
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“It seems that Covid and city shutdowns have generally affected Chicago’s real estate market, but honestly has not affected Trump Tower at a different rate than any other building,” said Kristine Farra, founder and CEO of Gold Coast Real Estate in Chicago. “Buyers who purchase here value the location, luxury finishes, services and views.”
The outlook for Chicago real estate overall seems to be taking a turn for the better, though. The Illinois Association of Realtors found that in December, 32% more homes were sold than in December 2019, and the average home sale price was up 12.3% year over year. Whether this upward trend will extend to Trump Tower remains to be seen.
“With interest rates at record lows, well below 3%, if anyone is on the fence about Trump Tower or another building now is definitely the time to lock down rates and purchase that home,” Ms. Farra said.
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High-end real estate in South Florida has fared better overall throughout 2020 than luxury sales in many other regions of the country. In Miami-Dade, Palm Beach and Broward Counties, an influx of wealthy buyers, particularly from the Northeast, drove up sales prices as they sought out a warm-weather, low-tax refuge.
Single-family properties were particularly in demand, but luxury condo sales have also risen in Miami-Dade County, increasing by 1.6% in 2020 compared to 2019. Broward and Palm Beach counties saw even larger jumps.
The former president, who won Florida in both the 2016 and 2020 elections, is closely associated with the region due to his Mar-a-Lago resort, where he has been in residence since leaving office. And overall, Trump-owned properties in the area seem to be benefiting from broader trends that have developed since the onset of the pandemic.
“People are still leaving New York and San Francisco, and seeking out more affordable options, in vacation areas with warmer weather,” Ms. Fairweather said.
But not everyone welcomes the Trump brand: Residents at Trump Plaza, a West Palm Beach condo no longer owned by the Trump Organization, voted to remove the name from its facade after the Jan. 6 riots.
Elsewhere in South Florida, residents are just fine with the Trump branding on their buildings. On Sunny Isles Beach in Miami-Dade County, the Trump Organization owns several high-rise oceanfront condo developments, and these holdings have also benefited from the recent rise in demand from wealthy buyers, agents said.
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“While I’ve noted some pushback on having a Trump-branded building in markets like New York, our Sunny Isles Trump buildings continue to flourish without any noticeable buyer objections to looking at our three Trump Towers and other Trump offerings, including Trump Palace and Trump Royale,” said Mark Zilbert, a broker with Brown Harris Stevens in Miami Beach.
Several units in the Trump Tower, Trump Palace and Trump Royale properties sold recently, but many did so below their initial asking price. This Trump Tower three-bedroom, for instance, sold in December for $1.95 million, 8.5% down from its initial ask of $2.349 million. And this four-bedroom has dropped substantially in value since it was first listed, in 2017, for $4.395 million; now the condo is asking for $3.695 million.