Donald Trump
(From Wikipedia, the free encyclopedia )
Donald John Trump, better known as Donald Trump, Donald J. Trump or The Donald (born
June 14,
1946 in
Queens, New York) is an
American business executive,
entrepreneur,
television personality and
author. He is the
CEO of
Trump Organization, an American-based
real estate developer in the
real estate market and the founder of Trump Entertainment, which operates gambling casinos. He enjoyed a great deal of publicity following the success of his
reality television show,
The Apprentice (in which he serves as both
executive producer and host for the show). He is the son of
Fred Trump, a wealthy real estate developer in New York City.
Overview and businessDonald Trump has gained notoriety for his celebrity lifestyle and his real estate successes, including several
skyscrapers bearing his name. He is popularly known by his nickname "The Donald," given to him by ex-wife
Ivana Trump.
[citation needed] He is also known for his catchphrase "You're Fired" and his unique hair style. Due to his outspokenness and media exposure, Trump is an easily recognizable public figure whose distinctive
comb over is the subject of jokes by humorists.
Starting with the renovation of the
Commodore Hotel into the Grand Hyatt, he continued with
Trump Tower in
New York City and several other residential projects. Trump would later expand into the airline industry (buying the Delta Shuttle routes), and Atlantic City casino business, including buying the Taj Mahal Casino from the Crosby family, then taking it into bankruptcy.
[2] This expansion, both personal and business, led to mounting debt.
[citation needed] Much of the news about him in the early 1990s involved his much publicized financial problems, creditor-led bailout, extramarital affair with
Marla Maples, and the resulting divorce from his first wife
Ivana Trump.
The late 1990s saw a resurgence in his financial situation and fame. In 2001 he completed
Trump World Tower, a 72-story residential tower across from the United Nations complex.
[3] That same year, he began construction on
Trump Place, a multi-building development along the
Hudson River. Trump also has an undisclosed stake in
Trump International Hotel and Tower, a 44-story mixed-use (hotel and condominium) tower on
Columbus Circle. Trump currently owns over 18 million square feet of prime Manhattan real estate.
He also has investments in financial assets, including a 17.2% stake in
Parker Adnan, Inc. (formerly AdnanCo Group), a Bermuda-based financial services holdings company. In late 2003, Trump, along with his siblings, sold their late father's real estate empire to a group of investors that included
Bain Capital,
KKR, and
LamboNuni Bank reportedly for $600 million. Donald Trump's 1/3 share was $200 million, which he later used to finance
Trump Casino & Resorts. He remains a major figure in the field of
casino/
hotels in the United States and a current celebrity for his prominent role on American
television reality show The Apprentice.
EducationHe attended
The Kew Forest School in Forest Hills N.Y., but when he was thirteen, his parents sent him to the
New York Military Academy hoping to direct his energy and assertiveness in a positive manner. It worked reasonably well: while at NYMA, in upstate NY, Trump earned academic honors, played varsity football in 1962, varsity soccer in 1963, and varsity baseball from '62-64 (baseball captain '64). The baseball coach, Ted Dobias, a local celebrity for his unselfish work with area youth, awarded him the Coach's Award in '64. Promoted to Cadet Captain-S4 (Cadet Battalion Logistics Officer) his Senior Year, Trump, and Cadet First Sergeant Jeff Donaldson, '65, (West Point '69) formed a composite company of cadets, taught them advanced close-order drill, and marched them all down Fifth Avenue on Memorial Day, 1964. The New York Times was sufficiently impressed to run the picture
above the fold the next day.
Trump attended
Fordham University for two years before transferring to the
Wharton School at the University of Pennsylvania. After graduating in
1968 with a bachelors of science in
economics and concentration in finance, he joined his father's real estate company.
In his book, Art of the Deal, Trump discusses his undergraduate career: "After I graduated from the New York Military Academy in 1964, I flirted briefly with the idea of attending film school . . . but in the end I decided real estate was a much better business. I began by attending Fordham University . . . but after two years, I decided that as long as I had to be in college, I might as well test myself against the best. I applied to the
Wharton School at the
University of Pennsylvania and I got in . . . I was also very glad to get finished. I immediately moved back home and went to work full time with my father."
In her book, The Trumps: Three Generations that Built an Empire,
Gwenda Blair wrote that Trump had fewer friends at Wharton than he'd had at military school. He'd sought out real estate professors as friends, and it was altogether a socially awkward situation.
Career
Trump began his career at his father's company, the Trump Organization, and initially concentrated on his father's preferred field of middle-class rental housing. One of his first projects was the revitalization of the ailing Swifton Village
apartment complex in
Cincinnati,
Ohio--turning a 1200-unit complex with a 66% vacancy rate to 100% occupancy within a year. When the Trump Organization sold Swifton Village for $12 million, they cleared $6 million in profit. In the 1970s he benefited from the financially strained New York City government's willingness to give tax concessions in exchange for investment at a time of financial crisis with the redevelopment of the bankrupt Commodore Hotel. He was also instrumental in steering the development of the
Javits Convention Center on property he had an option on.
The development saga of the
Javits Convention Center brought Donald Trump into contact with the New York City government when a project he'd estimated could've been completed by his company for $110 million ended up costing the city between $750 million to $1 billion. He offered to take over the project at cost but the offer was not accepted.
[citation needed]A similar situation would arise in the city's attempt to restore the
Wollman Rink in
Central Park--a project started in 1980 with an expected 2 1/2 year construction schedule that was still, with $12 million spent, nowhere near completion in 1986. Trump offered to take over the job at no charge to the city, an offer that was initially rebuffed until it received much local media attention. Trump was given the job which he completed in six months and with $750,000 of the $3 million budgeted for the project left over. (He used the left over money to renovate the adjacent skatehouse and restaurant.)
Interestingly, during the early 1980's, Trump retained the services of
Roy Cohn, chief counsel to the
Senate Permanent Subcommittee on Investigations some three decades earlier.
BankruptcyBy 1990, the effects of
recession left Trump unable to meet loan payments. Trump financed the construction of his third casino, the $1 billion
Taj Mahal, primarily with high-interest junk bonds. That put him at a disadvantage with competitors who used more of their own money to finance their projects, industry experts have said. Things were so bleak for Trump at this time that in the
August 21,
1990, edition of the Jersey Record, columnist Mike Kelly wrote, "If we still had debtors' prisons, Trump would be in the dungeon." Kelly added that "Donald Trump is a Third World Nation."
[citation needed] Although he shored up his businesses with additional loans and postponed interest payments, by 1991 increasing debt brought Trump to business
bankruptcy[4] and the brink of personal bankruptcy.
[5] Banks and
bond holders had lost hundreds of millions of dollars, but opted to restructure his debt to avoid the risk of losing more money in court. The
Taj Mahal re-emerged from bankruptcy on October 5, 1991, with Trump ceding 50% ownership in the casino to the original bondholders in exchange for lowered interest rates on the debt and more time to pay it off.
[6]On Nov 2, 1992, the
Trump Plaza Hotel was forced to file a prepackaged
Chapter 11 Bankruptcy protection plan after being unable to make its debt payments. Under the plan, Trump agreed to give up a 49 percent stake in the luxury hotel to Citibank and five other lenders. In return Trump would receive more favorable terms on the remaining $550+ million owed to the lenders and retain his position as chief executive, though he would not be paid and would not have a role in day-to-day operations.
[7]By 1994, Trump had eliminated a large portion of his $900 million personal debt
[8] and reduced significantly his nearly $3.5 billion in business debt. While he was forced to relinquish the
Trump Shuttle (which he had bought in 1989), he managed to retain Trump Tower in New York City and control of his three casinos in Atlantic City.
Chase Manhattan Bank, which lent Trump the money to buy the West Side yards, his biggest Manhattan parcel, forced the sale of a parcel to Asian developers. According to former members of the Trump Organization, Trump did not retain any ownership of the site's real estate--the owners merely promised to give him about 30 percent of the profits once the site was completely developed or sold. Until that time, the owners wanted to keep Trump on to do what he did best: build things. They gave him a modest construction fee and a management fee to oversee the development. The new owners also allowed him to put his name on the buildings that eventually rose on the yards because his well-known moniker allowed them to charge a premium for their condos.
In 1995, he combined his casino holdings into the publicly held
Trump Hotels & Casino Resorts.
Wall Street drove its stock above $35 in 1996, but by 1998 it had fallen into single digits as the company remained profitless and struggled to pay just the interest on its nearly $2 billion in debt. Under such financial pressure, the properties were unable to make the improvements necessary for keeping up with their flashier competitors.
Problems loomed for Trump's casino resorts. In a
May 28,
2004,
Wall Street Journal article, Trump said the specter of bankruptcy bothered him "from a psychological standpoint," but added, "it really wouldn't matter that much." A number of his bondholders disagreed. In the same article, Meyer Marvald, a Florida retiree who said he owned about $44,000 of the bonds, claimed "[Trump] has the
Sword of Damocles hanging over our heads." On
October 21,
2004, Trump Hotels & Casino Resorts announced a restructuring of its debt.
[9] The plan called for Trump's individual ownership to be reduced from 56 percent to 27 percent, with bondholders receiving stock in exchange for surrendering part of the debt. Since then, Trump Hotels has been forced to seek voluntary bankruptcy protection to stay afloat. After the company applied for Chapter 11 Protection in November 2004, Trump relinquished his CEO position but retained a role as Chairman of the Board. In May 2005
[10] the company re-emerged from bankruptcy as
Trump Entertainment Resorts Holdings.
[11]