Trump Business Sought Virus Leniency at New York Retail Space

(Bloomberg) -- President Donald Trump’s family real estate company sought relief from lenders earlier this year for a retail property it owns in Manhattan.

The stretch of storefronts at the base of the Trump Plaza on the Upper East Side, whose tenants have included a vitamin shop and a Mephisto shoe outlet, is a minor part of the Trump Organization’s portfolio of hotels and resorts. But it provides a glimpse into how the president’s own U.S. businesses are handling the coronavirus pandemic that has battered retailers and the economy.

According to investor disclosures filed in May, the Trump Organization asked its lenders for Covid-19 related relief on the loan against the retail space. The sides were working toward a “possible solution,” according to one disclosure that didn’t provide details of what the company sought or whether any concessions were received. Landlords that have had a hard time collecting rent from tenants during the crisis have looked for ways to curb their own financial burdens, including temporary reductions in interest payments and extended repayment periods.

In Europe, Trump-linked golf resorts have sought U.K. and Irish relief money for employees. In the U.S., however, lawmakers put language in the CARES Act that barred Trump-controlled companies from tapping some rescue facilities. Trump’s business in the U.S. has also engaged its biggest lender, Deutsche Bank AG, in talks about relief, according to the New York Times.

A representative from the Trump Organization declined to comment.

The Trump Plaza retail property was appraised at $41 million in 2014 when the Trump Organization refinanced it with a $15 million loan from Ladder Capital, a commercial mortgage firm. That firm also made loans backed by the commercial spaces at Trump’s flagship Trump Tower and 40 Wall Street, a downtown Manhattan office building.

The Ladder Capital loans were later bundled with other real estate loans and sold to a broad base of investors. They have loan-to-value ratios below 50%, indicating relatively conservative debt issuance.

Documents show that Midland Loan Services, a division of Pittsburgh-based PNC Financial Services Group, services the trust that contains the loan. Asked to confirm that role, a PNC spokeswoman referred Bloomberg News to the filings.

As the pandemic hit retail and service businesses this spring, tenants at Trump Plaza, on Third Avenue between 61st and 62nd streets, included the shoe and vitamin sellers as well as the Upper East Cafe, where a Wagyu Kobe burger goes for $25.

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