Global property partners unfazed by Trump bombast
Real estate tycoon and White House hopeful Donald Trump has lost high-profile US contracts over his hardline anti-immigrant stance, but internationally the row has yet to damage the Trump brand.
When he disparaged undocumented immigrants from Mexico as criminals and rapists in June, several American groups — NBC television, retailer Macy’s, the PGA tour — severed ties with the defiant billionaire.
But the revolt was not matched in Asia, Europe and South America where promoters have paid dearly to display the globally recognized Trump marquee on their properties.
Any future impact of the US controversy is impossible to predict. But six weeks after his remarks began, the effects of Trump’s antagonism remain invisible overseas.
“We’ve practically sold out. We can say there has been no negative effect,” Maria Theresa Yu, a spokesperson for Trump’s Philippine partner, Century Properties Group, told AFP.
She was referring to Trump Tower Manila, a 56-floor luxury residential building that as of January was already 94 percent sold ahead of its 2016 opening.
Yu could not say how Trump’s toxic remarks might effect future business. But media and social networks in the Philippines have so far ignored the political controversy.
“The tower sold out really fast because the Trump brand exudes luxury,” she added. “Filipinos want to experience luxury.”
They are not alone. Trump’s empire outside the United States extends to 12 countries including Turkey, South Korea, India, Brazil, and the United Arab Emirates.
It features five golf courses, among them Trump Turnberry Resort in Scotland, where “The Donald” himself visited Thursday.
And it includes 12 complexes of hotels, residences and offices, several of which are under construction.
Their common theme: dizzying heights, flamboyant architecture and decor, robust pricing, and Trump’s name licensed to properties in exchange for vast royalties.
In 2011 in Panama City, Trump opened the tallest tower in Latin America (since surpassed by a skyscraper in Chile) — 70 floors of apartments and hotel rooms looming over the Pacific.
Trump’s comments have failed to cause even a ripple in India’s Maharashtra state, where his name is attached to two property developments.
The 75-plus story Trump Tower Mumbai is being built in partnership with Indian real estate developer Lodha Group.
Prices for the luxury residences, 40 percent of which have been presold, start at 90 million rupees ($1.48 million) — well out of reach of most inhabitants in a city where nearly 40 percent of people live in slums.
The company declined to comment on whether it was reconsidering its association with Trump.
But in Punta del Este, the upscale Uruguayan resort, Trump’s tirades have had “no impact whatsoever on the buildings,” according to Juan Di Salvo, sales director of the city’s Trump Tower.
Half the 156 luxury residential units set for a 2017 opening have already been purchased, at between $415,000 and $2 million.
With the labor sector bruised by layoffs, the 97 laborers on site were unfazed or unaware of the controversy, according to a union leader.
“Whatever he said, we do not need to agree with him. We just want to keep our jobs,” said Faustino Rodriguez, head of labor union SUNCA.
– ‘It won’t be positive’ –
“The prices of these properties won’t change just because Trump says this or says that,” said Jang Jae-Hyun, real estate expert at Real Today in Seoul, South Korea, where Trump opened six upscale condominiums in 2007.
But Jang predicted to AFP that if Trump continued to utter such remarks, “some companies here may have a second thought using his name and his brand in their properties.”
The question is key for projects where developers have yet to break ground, like Rio de Janeiro, where Trump licensed his name to a project of five office towers. Construction theoretically starts in late 2015.
This will be Trump’s second project in Rio, where a hotel is set to open next year.
“I don’t know if it’s going to be negative, but it won’t be positive,” Thierry Botto, Rio director of investments at Cushman & Wakefield, the exclusive letting agent of Trump Towers Rio, said of Trump’s comments.
Trump’s brand is lucrative: more than $5 million in royalties last year in Panama, $1 million to $5 million in Istanbul, and between $100,000 and $1 million each in Manila, Mumbai and Pune, India, according to paperwork Trump filed with US election authorities.
The licensing agreements allow him to avoid losses should a property file for bankruptcy, as a Trump golf club recently did in the struggling US territory of Puerto Rico.
Trump considers his name his top asset. He estimated his brand at $3.3 billion in June, more than a third of his claimed net worth.
While Trump claims his fortune stands at $10 billion, Forbes magazine estimates his total net worth at merely $4.1 billion.
At Trump’s New York headquarters, representatives denied the political rumpus has driven away business.
“The Trump brand is incredibly strong,” a spokesperson said. “Mr. Trump and his family have built a great company.”