Page 76 - 2

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

being paid, and Percy Pyne created the impression that the ground
lease owner was unreachable and all negotiations had to be done with
him. Listening to Pyne, one would believe that, in fact, he was speak-
ing for the owner.
Trump’s instinct was that if he wanted to make the deal, he had to
get to the owner and talk to him directly, to see whether or not some-
thing was being lost in the translation from Percy Pyne. He couldn’t
believe that a foreign owner of real estate would tolerate this property
in its present condition. So he got on a plane and flew to Germany to
meet directly with the ground lease owner. There he was able to es-
tablish a working relationship of mutual trust that led to successfully
negotiating a new ground lease that satisfied both parties. In fact,
Trump’s relationship with the landowner was so good that while
Trump was refurbishing the building (at greater expense than origi-
nally planned), Trump asked the owner to waive the rent for a second
year. The owner agreed because he was so thrilled with all the work
that was going on to make it a first-class building. The waiver saved
Trump another $1.5 million in rent. So, by the time Trump had to
start paying rent on the ground lease, he had a rental income suffi-
cient to cover all his obligations. As we discussed in Chapter 1, suc-
cessful, long-term real estate investing is always based on building
good personal relationships with the key people involved. The 40
Wall Street deal has a lot to teach small real estate investors about
negotiation. Following are explanations of five key principles that
Trump used to turn around 40 Wall Street, and how you can use
them in your real estate transactions.

PRINCIPLE 1: CREATE THE AURA OF EXCLUSIVITY

One of the most fundamental principles of human nature is that peo-
ple want something that everyone else wants or no one else has. If

54