I’m a big fan of Mr. Donald Trump.  This man arrived in the world with a golden spoon and has made himself larger.  He has entertained us all with his life.  He stays in there when things go wrong and does most things right.  His mantras have become the American way and he is a brand, an icon, an American idol.  Now that his Ivana kids are on the business wagon with him, he’s into a new family too,  I don’t see him getting old, old, old mentally nor lessening his business endeavors.  In fact, I see him reacting to the opportunities that the world’s growth increasingly presents.  Without ever meeting him, I sense that he’s a genuine guy with empathy for others to offset his steely New York business resolve.  I remember one TV image I have of him playing golf with Mark Wahlberg where his golf manners were impeccable.  I don’t expect that we would have a whole lot to talk about at dinner, but I’m sure he has social charm to match his business appeal.
What does Donald Trump do for a living?  Well, among other things, he runs a private business in the real estate development industry, a business that eats money.  This allows him never to present an audited financial statement to the general public, so he can engage in puffery to an unprecedented degree.  I’ve seen estimates of his wealth from $ 650 million to over $ 5 billion.  The higher estimates are mostly his own which brings a smile.  But the general public impression mostly mirrors his estimates rather than the lower amounts, so his exaggerations are helpful to the Trump business model.  His days are filled with discussions about deals and capital raising where his efforts are devoted to obtaining superior returns and the largest amounts of low cost, low risk capital. 
The Trump name pops up everywhere in the world now.  His reputation is solid from his base as one of the world’s pre-eminent developers of high-rise housing.  His relatively modest involvement in golf is big advertising.  The non-real estate activities knock off bucks as well as keep the name hot.  By his spin, he never has the wrong side of an issue and the public remembers it that way.
Since he’s a brand now and his projects to date are seen to be hot, profitable sellers, he’s able to make real estate development contracts on a non-recourse basis.  Others take the financial risk in return for the Trump development and marketing expertise and superior returns.  What distinguishes the Trump organization is the ability to negotiate participation on a scale of 50/50 for such involvement rather than the 3% brokerage marketing fee and 10% development fee others might obtain.  In other words, all his public pronouncements and bravado have worked, he’s a success.  Since he’s working at the very top end of the housing food chain, the market remains solid in most cases and may continue unless the haves in this country move over to the have not side.
But Mr. Trump has problems too.  His residential towers are not all financed non-recourse and his exposure is relatively high in Chicago, for instance.  His office development in New York chugs along on a multi-phase basis.  Multi-phase projects experience multi-markets, both good and bad, a trait which grows old and tests the market’s inclination to occupy that much of one developer’s product.  His involvement with Trump International Resorts must rankle too.  The gaming properties are marginal revenue producers and perpetually cash strapped.  The Trump name is still there but Trump himself is not the manager and he is now the minority partner.  The problem here is I sense a problem with the IRS where tax avoidance awaits a taxable event which will hurt big time.  The recent failure of the property sale program indicates that all is not well. It may be that the failure is attributable to Trump needing more to pay the IRS. 
Donald Trump is a big thinker and I don’t believe he’d back away from any of this for an instant.  I do believe, however, that he is going to model himself after the non-risk programs of the hotel franchisors in the future as much as possible, particularly when he gets into the offshore markets where he is not as experienced.  Smart move now that he attracts capital that will make that plan work.  No doubt that we’re all going to hear about it, all you have to be is alive and awake to get the Trump message.                             

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