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T HE T RUMP T OUCH

One ofthelessons for small investors to learn is to find ways,
when possible, to put your property to multiple uses, with multiple
income streams. If you can create a new use for the property that
didn’t previously exist, and a new income streamtogoalongwithit,
you will have dramatically increased the value of the property when
its time to sell or finance. For example, if you have a rental property
in thecity, you maybe able to charge extra for off-street parking, to
anyone who lives in the neighborhood. Or you may be able to offer
additional services to your tenants, such as Internet service or laun-
dryfacilities,for a fee. This strategy also helps to diversify the in-
come from the property so it doesn’t come completely from one
source (e.g., rents). This makes your income stream from the prop-
erty less risky, and therefore more valuable.
This multi-use strategy worked brilliantly in Trump Tower, but
there were several site-related issues that required resolution before
Trump could begin to build. One major problem was the fact that the
site consisted of utilizing more than one parcel of land. It included a
ground lease on a 25 foot by 100 foot parcel on 57th Street that was
owned by Leonard Kandell, an elderly, very savvy real estate developer
and investor. Knowing that the ultimate success of the venture hinged
on the size of the building he could build on the site, Trump tried to
buy Kandell’s property but Kandell refused to sell it at any price.
Trump’s only interest in buying Kandell’s parcel was because owner-
ship meant that he would have the right to build a larger building. I
enlightened Donald about the zoning laws that permitted one owner
to sell and transfer unused building rights (commonly called air rights)
from his property to the property of an adjacent owner. I told him, “If
somehow we can get Kandell’s air rights you don’t need to own his
piece of property.” Since Tiffany owned the adjoining property on the
corner of 5th Avenue and 57th Street which also had air rights, Trump
said, “Tiffany has air rights, too, so I’ll buy those.” He proceeded to
negotiate a deal with Tiffany to buy the air rights over their site.

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