On Wednesday night President Donald J. Trump released a press statement from his account, “Office of 45” to update his supporters about a loan he apparently secured on a property that is known as “The Bank of America Building”. The move is a most likely a Victory lap because Trump’s opponents had hoped to use their cancel culture to pressure people to not work with him.
“A loan of $1.2 billion has closed on the asset known as the Bank of America Building (555 California Street) in San Francisco, CA. The interest rate is approximately 2%. Thank you,” Trump’s announcement read.
“Donald Trump is set to share a $617 million windfall with Vornado Realty Trust, due to a property refinancing deal, reports say,” Business Insider reported in early May.
- Vornado and Trump will get $617 million as part of a $1.2 billion bond sale, Bloomberg reported.
- The payout is part of a refinancing deal for 555 California Street in San Francisco.
- Trump is a 30% partner in 555 California and 1290 Avenue of the Americas in New York.
The Trump Organization has about 30% ownership in office towers on both coasts through a partnership with Vornado. Together, they own 555 California Street in San Francisco and 1290 Avenue of the Americas in New York City.
Yahoo Finance reported:
Investors snapped up $1.2 billion of bonds linked to a San Francisco office tower that makes up much of Donald Trump’s fortune.
The AAA slice of the commercial mortgage-backed security sold Friday with a discount margin, or risk premium, of 125 basis points over one-month Libor — roughly in line with other recent office-tower deals.
The bonds are being used to refinance a loan on the 555 California Street property in a deal that gives joint owners Vornado Realty Trust and Trump a $617 million payout.
The complex, among the tallest buildings in San Francisco, is one of two Trump-linked office towers that Vornado is refinancing. The other is in New York. While Vornado majority owns them, Trump’s 30% stake is the most valuable part of his portfolio, making up about one-third of his $2.3 billion fortune, according to the Bloomberg Billionaires Index.
The refinancing — and cash windfall for Vornado and Trump — comes months after several banks tied to the former president said they would no longer work with him after the deadly U.S. Capitol riot in January.
‘Trump’s Poor Record’
While the bond found strong demand, at least one investor was put off by the Trump connection.
“We looked at the deal and it did not pass our Environmental, Social, and Corporate Governance (ESG) process because of Trump’s poor record (going back to the 1990s) of not only paying back investors, but being difficult when he runs into difficulties,” John Kerschner, head of securitized products at Janus Henderson, said in an interview.
Kerschner said the offering priced tighter than some other “esoteric” office-tower CMBS deals with somewhat lower-quality properties, such as a recent deal underpinned by a loan on office towers in downtown Houston. On the other hand, the deal priced the same or slightly wider than some deals tied to higher-quality trophy towers, he added.
BUT IN THE END, TRUMP WAS VICTORIOUS
“VORNADO REALTY TRUST (NYSE: VNO) announced today that it has completed a $1.2 billion refinancing of 555 California Street, a three-building 1.8 million square foot trophy office campus in San Francisco,” the news said.
JOURNALISTS HAVE BEEN OBSESSED WITH TRUMP’S ASSETS
And the left is so confused. No one is supposed to like Trump.
Who would close a $1.2B loan to a guy a day after it was announced he was under a criminal investigation for insurance and tax fraud?
— 🌲Andy 👣from 👣Oregon🌲 (@AndrewFmOregon) May 20, 2021
From a 2015 San Francisco Chronicle article, the Bank of America building has long held interest for journalists and one reporter wrote:
“When he announced last week that he is running for president, Trump said, “I own a big chunk of the Bank of America building and 1290 Avenue of the Americas that I got from China in a war. Very valuable. I love China.”
Vornado acquired its 70 percent stake in the two buildings in 2007 from U.S. entities controlled by a Hong Kong investment group for $1.8 billion. Trump was a limited partner in the investment group and had been feuding with it, according to Forbes. The deal left Trump with a 30 percent stake in the two buildings.
Vornado’s initial allocation of its purchase price put a total value of roughly $1 billion on the San Francisco tower and $1.55 billion on the New York one.
In a one-page net worth summary, Trump listed the value of his partial interest in those two buildings, along with two others, at $943 million. Bloomberg estimates the value of his 30 percent interest in the San Francisco and New York buildings combined at $640 million.”
Trump won, again.
Kari is an ex-Community Organizer who writes about Cultural Marxism, grassroots activism, music, IndyCar racing and political campaigns. @Saorsa1776