Posts Tagged ‘historic properties’

Conflict of Interest on Pennsylvania Avenue

August 29, 2016

Conflict of Interest on Pennsylvania Avenue

Presidential candidate Donald Trump already has a home on Pennsylvania Avenue, a few blocks from the White House. It’s a $200 million hotel project he’s developing in the Old Post Office Building, a historic property owned by the federal government and leased to the Trump Organization for 60 years.

As Steve Perlstein observed, it’s “curious” the government “… would choose to pass over established, deep-pocketed hoteliers such as Marriott, Hyatt and Hilton in order to choose a lead developer who has spent so much time in U.S. Bankruptcy Court that he qualifies for elite frequent-flier status.” Part of the appeal might have been due to Trump’s financial bait-and-switch. Trump’s bid included funding from his Californian investor pal Tom Barrack, the guy who had sold him the Plaza (Trump sold it for a huge loss). After Trump got the Old Post Office contract, Barrack pulled out and Trump off-shored the financing, borrowing $170 million from Germany’s Deutsche Bank instead. The collateral? The federal lease on the tax-payer-owned property.

Remember, the historic Old Post Office Building’s landlord is the General Services Administration (GSA), a federal agency.

“You’d be kidding yourself if you don’t think the president of the United States has influence over this. And [Trump’s] taken no affirmative steps to separate himself from this conflict of interest. I don’t know how this is not a bigger issue. It’s crazy.”
— Jessica Tillipman, George Washington University Law School