Donald Trump’s book “How To Get Rich”:’I remember, when I was the Donald!’
When Donald Trump announced that he was running for the White House, there was only one venue for his speech: Trump Tower on Fifth Avenue. The skyscraper has been central to Mr Trump’s business life. Built between 1979 and 1984, it was a triumph for a young property mogul whose father rented out mere apartments in Brooklyn. Nearby is the Plaza Hotel, which a middle-aged Mr Trump sold in 1995 after his casino operation folded. Today half his wealth is still tied up in buildings within a four-mile radius of this spot. The Tower’s bar exemplifies Mr Trump’s late-life pivot to the business of celebrity, with cocktails named after his TV show The Apprentice, which was filmed there. A gift shop stocks Trump aftershave that “captures the spirit of the driven man”.
which version is right? A review of Mr Trump’s career, his filings with regulators and third-party estimates of his wealth, suggests four conclusions. First, his fortune is in the billions of dollars. Second, his attempt to shift away from debt-heavy property and to create a global brand has been a limited success. About 93% of his wealth sits in America and 80% is in real estate (including golf courses). Third, Mr Trump’s performance has been mediocre compared with the stockmarket and property in New York. Lastly, his clannish management style suggests he might be out of his depth if he ran a larger organisation.
“I’ve been through cycles, I’ve been through a lot,” admits
Mr Trump. His career can be split into three stages. The era of debt-fuelled expansion was in 1975-90. Mr Trump’s big break was the renovation of a site at Grand Central Station, which is now occupied by the Hyatt Hotel. He raised cash, found a tenant, secured permits and completed a complex building job, according to his biographer, Michael D’Antonio. Buoyed by success he went on a long spree, buying buildings in a depressed Manhattan (including the site of Trump Tower), expanding into casinos in Atlantic City and picking up a small airline. His investments over this period were worth perhaps $5 billion in today’s money, with four-fifths of that debt-financed.
The era of humiliation came in the 1990s, as the casino business faltered and two of his gambling entities defaulted (two other related casino enterprises defaulted in 2004 and 2009). This destabilised the whole of Mr Trump’s operation, which may have had as much as $6 billion of debt in today’s prices. Through asset sales, defaults and forbearance from his creditors, Mr Trump clung on and avoided personal bankruptcy. As property prices in Manhattan rose he recovered his poise, and by the early 2000s he was doing small deals again, for example buying the Hotel Delmonico on New York’s Upper East Side.
The success of the TV show The Apprentice, which had 28m viewers at its peak and ran until 2015, led Mr Trump to create a flurry of ventures to cash in on his enhanced fame. He is now involved with 487 companies, up from 136 in 2004. They span hotel licensing in Azerbaijan and energy drinks in Israel. At face value Mr Trump has turned his name into a global brand that prints cash.