Auction Helps Trump, but Two More Deadlines Loom
Donald J. Trump got some help with a mortgage Sunday by auctioning 35 luxury waterfront condominiums overlooking this high-society resort.
However, he faced a couple of more mortgage-payment deadlines today that it appeared he would have difficulty making.
On Sunday, the units in the twin 38-story towers at Trump Plaza of the Palm Beaches sold for $8.815 million, 24% above the asking price. However, the asking price had been slashed by up to two-thirds.
“We far exceeded our expectations today. This was a tremendous sale for Trump Plaza,” Trump said. “I think it could work out to be a very good deal, depending on what ultimately happens with the final numbers.”
Previous asking prices of $300,960 to $1.8 million for the penthouse were trimmed to minimum bids of $150,000 to $600,000 under pressure from Marine Midland Bank. The bank wanted Trump to unload the units that had gone unsold since the developer took over the building in 1986. At the time he acquired it, he boasted that the complex would be Florida’s hottest property.
Developer Ian Kean of nearby Singer Island bought the penthouse for $720,000.
The building’s biggest drawback, local real estate experts say, is location. The property is on the wrong side of the Intracoastal Waterway in this prestige-conscious neighborhood.
The auction took place on the right side--a chandelier-bedecked ballroom at The Breakers, a grand dame hotel on this barrier island. Trump’s 118-room Mar-a-Lago weekend retreat is also on the more prestigious side of the waterway.
About 85 of the 221 units remain vacant or unsold. Officials said Trump made the decision not to auction all units.
Trump missed a $27.1-million payment Oct. 22 to Marine Midland, which lent him the money to buy the building. In a restructuring agreement in August, his lenders pushed him into the auction because sales had been so sluggish. Only one had been recorded this year.
As the auction catalogue says, “glorious sun-drenched days evolve into dazzling moonlit nights” at the towers overlooking the Intracoastal Waterway and the town.
The Trump Plaza has a sumptuous lobby with walls of marble and leather, concierge, valet parking, morning and afternoon pools, sunning terraces, a fitness center and tennis courts.
But the units are largely unfinished.
“I think that was disappointing, because that was not announced prior to our coming down here, and that was disturbing,” said Bobbe Jacobson of Boston, a professional party planner. “Not having plaster up is not one would call finished. Having a floor down is an absolute must.”
Meanwhile, Trump is also due to make $34.5 million in payments to bondholders who invested in two of his Atlantic City casinos. The formal deadline for an $18.4-million payment on the Trump Castle and a $16.1-million payment on the Trump Plaza Hotel and Casino was Saturday, but Trump was given until today to cover the bills because of the weekend.
Last last week, his chief financial officer said he probably would miss the deadline on the Trump Castle.
If he fails to meet the deadlines today, he will be given a 10-day grace period to turn over the bond money on Trump Castle. He would have 30 days to make the payment on the Trump Plaza Hotel and Casino.
If no payment were forthcoming by the end of the grace period on the Castle, bondholders could seek to force it into bankruptcy proceedings.
