Monday Musings – September 10, 2012

by Dr. Vincent Patterson

Merry Monday Greetings! You may have heard that The Donald is getting the bid to convert the historic Old Post Office into a world-class hotel. This is becoming quite a story and here’s more: In the August 17 Business/ W.Post, staff writer Jonathan O’Connell goes in depth, revealing the details of how (mostly) Ivanka Trump won this prize. Why did she “go for it?”  O’Connell opines, “It’s historic, celebrated and on prestigious Pennsylvania Ave. The perfect building for Donald Trump…and his daughter Ivanka are close to adding the national landmark to the growing portfolio of shiny Trump things. Built in the 1890’s, it has been ogled by local developers for years, and competition for the property began to boil almost immediately when the federal government sought private partners in March 2011.” Smiling at the writer in his 26th floor Trump Tower office, The Donald said, “…we are paying too much for the Old Post Office ($200mill.).” “But we will make that so amazing that at some point in the future it’ll be very nice.” Just nice? Turns out it was Ivanka who did her due diligence and sold Pops on the idea. “Ivanka has graced the cover of lifestyle magazines…. A Wharton graduate who strikes a serious tone when discussing real estate, she played a role in developing Chicago’s Trump Tower and took the lead on a $150 million purchase of Doral Golf Resort outside Miami. As vice president … Ivanka considered Washington one of the most attractive markets in the world to build the family’s ninth luxury hotel. ‘For us I would say if there was a top priority market,’ she said, ‘I would put Washington at the top of the list of globally.’” Right on, Ivanka! Our DC laws will no doubt cramp their skyscraper style, like the one that keeps most buildings at 130 ft. max. So the OPO Clock Tower is at 315 ft. Already the Trumps have a leg up!  “When the competition began last April, Ivanka… joined dozens of developers… in a walk-thru of the building, past kitschy shops … crumbling rear annex, up into the clock tower with soaring views of the National Mall. … Ivanka realized the OPO, on Penn. Ave. between the White House and the Capitol was the building she wanted. ‘It’s not replicable – the beauty of this building, the location, the potential.’” “Ivanka chose architect Arthur Cotton Moore, a Washington native. He had begun working renovation plans for OPO in the 1970’s and is intimately familiar with the building. They worked together re-doing the Grand Hyatt in NYC and others. Putting up the money is partner Colony Capital, a California private-equity co. Together they offered $200 million to renovate the OPO into a luxury hotel, spa and three restaurants.”  Maybe we can get our tour folks in there for dinner sometime, eh??  Ha-Ha!! For their 60-year lease, Trump/Colony promised $3 mill. in base rent. At her presentation to GSA in the L’Enfant Plaza, it was noted Ivanka made “more of an imprint” than others, according to a GSA official. Regarding the lengthy lease, “Ivanka seemed to embrace the building’s permanence as a Trump property, suggesting her daughter, Arabella Rose (now nine months old), would one day oversee it. ‘She fully anticipates her daughter growing up in the business and being out there years down the road negotiating the renewal,’ the official said.  “GSA officials … pointed to the $200 million in announcing the selection, saying the project would save millions in taxpayer dollars and provide a positive economic return for the Federal Government.” O’Connell closes, “Trump said he wasn’t so focused on making money … Is there a market of Washington travelers willing to pay up to $700 to stay in a hotel with his name on it? ‘Maybe and maybe not,’ he said. ‘And … if there isn’t’, it’s okay, because we have a lot of money. And we’ll have a beautiful painting.” What a country, eh?  We’ll keep our periscope on this cruise and see what stormy waters lie ahead. Stay tuned!