Trumps Put Their Washington Hotel on the Market – The New York Times

President Trump has drawn frequent criticism for ownership of the hotel because it hosts foreign diplomats and corporate executives with business before his administration.

The Trump International Hotel in Washington might be up for sale.Credit…Erin Schaff/The New York Times

WASHINGTON — It is the most visible and potent symbol of the ethics debate that has dogged President Trump as he has served simultaneously as the nation’s chief executive and real estate developer with a chain of luxury hotels. And now it is for sale.

The Trump International Hotel in Washington, five blocks down Pennsylvania Avenue from the White House, has been put on the market, just three years after the Trump family spent $200 million to open it in the historic, federally owned Old Post Office building, and at a time when Mr. Trump is facing impeachment and a tough 2020 re-election campaign.

The Trump Organization’s announcement that it is listing the hotel with a real estate agent and wants to listen to offers came less than a week after Mr. Trump’s two roles intersected in a politically and ethically awkward way: He disclosed his intention to host the 2020 Group of 7 meeting of world leaders at the Trump National Doral resort near Miami, then had to abandon the plan after hearing from fellow Republicans that it was a bad idea.

But nothing has rivaled the steady stream of criticism — and the multiple lawsuits — accusing Mr. Trump of violating the Constitution by accepting payments at his 263-room hotel in Washington from foreign governments.

The hotel has also been a magnet for millions of dollars in business from lobbyists, corporate executives and political groups, many of which are pushing the White House for policy actions or other favors.

In offering the hotel for sale, the Trump family acknowledged this tension, even as it argued that the foreign government and politically connected business at the hotel does not constitute a legitimate ethical issue.

“Since we opened our doors, we have received tremendous interest in this hotel and as real-estate developers, we are always willing to explore our options,” Eric Trump, one of the president’s sons, said in a statement on Friday. “People are objecting to us making so much money on the hotel, and therefore we may be willing to sell.”

The hotel opened in late 2016, just before Mr. Trump was elected president, and quickly became one of the single biggest sources of revenue for the Trump family, according to financial disclosure statements, collecting $40.8 million last year.

The president’s daughter Ivanka Trump, even while working in the White House, also retained a stake in the property, earning nearly $4 million from it last year.

The hotel in Washington is one of the few parts of the company that has had major revenue growth since Mr. Trump took office.

The Trump family spent $200 million renovating the huge Romanesque Revival structure, after the federal General Services Administration picked its bid to manage the hotel at the property, and a 60-year lease on the building.

Built from 1892 to 1899 to house the United States Post Office department headquarters and the city’s post office, it is the second-tallest building in Washington after the Washington Monument. It is easily recognizable on the city’s skyline, given its distinctive clock tower, which is still open to the public

Trump family executives, including Eric Trump, declined to address questions Friday about why they had decided to put the hotel up for sale now, with impeachment proceedings picking up and the 2020 campaign in full swing.

But Mr. Trump’s annual financial disclosure statement shows that his hotels have been underperforming other similar luxury properties in a number of major hotel markets in the United States, including Chicago and Hawaii, industry analysts said.

On Monday, after reversing his decision to hold the Group of 7 meeting at the Trump National Doral resort near Miami, the president addressed what he suggested was a politically driven loss of business at some of his family properties.

“All of a sudden, people — some people — didn’t like it,” Mr. Trump said as he pointed to declines in sales at the Doral. “They thought the rhetoric was too tough, and it went from doing great to doing fine. It does very nicely now.“

Speaking more broadly about the effect of the presidency on his family businesses, he said: “Now, instead of having 100 percent of the market that loves you and they love your brand and it’s luxury and it’s great, now you have 50 percent of the market. That’s called politics. I fully understood that.”

Bruce Rosenberg, an executive at HotelPlanner, a company that sells millions of hotel rooms a year, said that the Trump hotel in Washington was a “trophy” property that a major national brand could turn into a more profitable outlet, if it did not have to worry about the reputational issues.

“It is prime hotel, a prime destination and prime location,” he said, estimating it could attract bids of about $500 million. “And look how close it is the White House. It is going to be a very attractive on a sale. But there are certain group of people who don’t want to stay there.”

Any transfer of the lease would have to be approved by the General Services Administration, which awarded the deal to the Trump Organization after a competition among various bidders.

Before the Trump Organization can sell, the deal will need to pass muster with the company’s outside ethics adviser, Bobby Burchfield, who is a lawyer in Washington.

Under an ethics plan adopted when Mr. Trump became president, Mr. Burchfield must verify that the deal is not unusually favorable to the Trumps — the price must reflect a “fair market value”— and that the buyer is not seeking to gain favor with the Trump administration, among other tests. The buyer cannot be a foreign official or sovereign wealth fund, but foreign citizens are not automatically prohibited from buying the hotel.

The hotel is central to lawsuits pending against the Trump Organization by at least three groups that argue Mr. Trump is violating the Constitution by accepting payments from foreign governments.

The Trump family has tried to address the emoluments issue by sending an annual payment to the Treasury Department for what it says are the profits from these payments by foreign governments, which it said totaled about $191,538 last year at the Washington hotel and other properties it owns, up from $151,470 the year before.

Eric Trump, in a statement about the potential sale, which was first reported on Friday by The Wall Street Journal, said the family had already done its part to address the questions about conflicts.

“Unlike every other hotel company, while our father is president of the United States, we have imposed voluntary restrictions and have chosen not to market, nor solicit, foreign government business during his time in office,” he said.

But the operations at the hotel have continued to draw criticism.

“The Trump D.C. hotel has embodied the conflicts of interest and self-enrichment schemes that pervade the Trump administration, easily the most corrupt in modern American history,” said Robert Weissman, the president of Public Citizen, a group that has tracked millions of dollars in spending by political candidates, foreign governments and other politically connected groups at the hotel.

One nonprofit group, Citizens for Responsibility and Ethics in Washington, has tracked at least 694 visits to the hotel by executive branch officials, members of Congress and foreign government officials since Mr. Trump took office.

A provision in the lease says that “no member or delegate to Congress, or elected official of the government of the United States or the government of the District of Columbia, shall be admitted to any share or part of this lease,” which may prohibit the ownership arrangement. The lease was granted to Mr. Trump before he was elected president.

House Democrats this week sent a subpoena to the General Services Administration demanding that it provide documents addressing this question, which was first raised shortly after Mr. Trump was elected.

“Removing the Trump Organization from the lease of a taxpayer-owned building is a good place to start to ensure President Trump isn’t making a profit as both landlord and tenant of the Old Post Office Building,” Representative Peter A. DeFazio, Democrat of Oregon, who is chairman of the House committee that oversees the General Services Administration, said in a statement Friday.

“I’m skeptical that this latest development isn’t an attempt to make a massive profit that directly benefits the Trump family so I will be following this marketing attempt closely,” he added.

The Trump family has hired the real estate company JLL Hotels & Hospitality to help look for potential buyers of the hotel. But it did not address questions on Friday about why the family choose now to try to sell the hotel, or if it reflected any financial pressure on the Trump Organization, whose many other business operations have declined during Mr. Trump’s tenure in the White House

The White House declined to comment on Friday on the announcement.

Source: Trumps Put Their Washington Hotel on the Market – The New York Times