Page 74 - [George_Ross,_Andrew_James_McLean,_Donald_J._Trump(BookFi)

TR U M P STR A TEGI ES FO R R E A L ESTA TE

for $17 per square foot, you’ll break even. On the next 300,000 square
feet going down, the floorsarelarger, so even without the views we
should still be able to average $17 a square foot in rent. If I can do that,
youwillmake a profit. As for the bottom 300,000 square feet, it
doesn’tmatter if you never rent it as office space. You’re in so cheap
at $1 per square foot; it won’t make any difference what you do with it
so long as you can cover the cost of renovation for an occupant.”
Ioutlinedmygameplan:“Firstyou’llhavetodoatotalmakeover
of the lobby to make it luxurious, à la Trump style. Second you’ll have
to renovate the infrastructure to bring it all up to state of the art. This
will include the elevators, air conditioning, electrical, and plumbing
systems. Third, to be competitive with more modern buildings, all of
the latest telecommunication and data systems must be installed and
available for tenants. If you agree to do that, I’ll do the leasing.” Trump
replied, “George,makeithappen.”
Trump borrowed $35 million from Union Labor Life Insurance
Company to be used for renovations. They loved the idea of renovat-
ing this building because it would put many of their union members
back to work. They even stipulated that only union members could
be used in construction or renovation. Although the loan was for $35
million, it wasn’t nearly enough if we signed tenants and made the
improvements that would be required. I told Trump: “If the building is
a huge success, it’s a terrible loan but if the building bombs, it’s a
great loan.” Nevertheless, based on the past history of failures with
the building and the economic climate at that time, it was the only
loan Trump could get at that time.
I settled the mechanic liens that existed on the building (almost $1
million) for $60,000. I told all the parties that had the liens, “Look,
there’s no way you’re going to get paid the amount of your claims. But
I will give you first crack at renovation work on the building if you give
up your liens.” Most of them agreed to it, and I gave them an opportu-
nity to bid on the work.

52