Metropolis

How Screwed Is the Trump Hotel D.C.?

The former president is stuck with a money-losing monument to his administration’s graft, and so is Washington.

An entrance of the Trump International Hotel is blocked in the morning hours of Nov. 4, 2020 in Washington, D.C.
The hotel and its moat. Alex Wong/Getty Images

For three years, the lobby of the Trump International Hotel Washington, D.C., was the hedonistic center of the MAGA-verse. The room glittered with chandeliers and the flashes of sabers slicing open Champagne bottles (prefaced by the ringing of a bell to draw eyeballs to the spectacle). Trumpworld luminaries like Corey Lewandowski and Sebastian Gorka schmoozed bar-side with established D.C. power brokers. Republican politicians on their way to backroom fundraisers stopped for selfies with star-struck customers swigging $9 Bud Lights. Proud Boys chatted up top presidential advisers.

Advertisement

Once, pictures from the hotel lobby showed Trump Cabinet members, foreign leaders, compliant GOP lawmakers, CEOs, lobbyists, Hill staffers, and the MAGA faithful.

Advertisement
Advertisement
Advertisement

But for almost a year now, this playground has been largely vacant, barstools unoccupied like a swing swaying in the breeze. These days, the images from the hotel that you’ll encounter on social media reveal still lifes of unsold booze or masked staffers celebrating their birthdays:

Advertisement

The reckoning that Trump’s D.C. hotel faces in Joe Biden’s Washington isn’t just the result of the previous administration’s bungled response to a raging pandemic followed by an election loss and attempt to subvert democracy. And it’s not just because the broader hospitality industry is still struggling as Americans travel less during lockdown. After all, without any of those factors, Trump previously steered six hotels into bankruptcies.

Advertisement

The Trump Hotel D.C. also enjoys a business plan that befuddles industry experts, a $170 million mortgage that’s coming due, the scrutiny of continuing investigations, and a new landlord who—for a change—does not double as the hotel’s owner. While it’s unlikely the federal government will evict the Trump Organization, the ex-president’s company doesn’t seem happy to hang around either. It tried to unload its lease in 2019 and couldn’t find someone to meet its asking price.

Advertisement

So like a boot left abandoned in the gooey muck of swamp bottom, the Trump International Hotel is sticking around D.C. It’s a fitting monument to the former president, his cult of personality, and the culture of graft that defined his Washington.

The Trump Hotel’s self-inflicted financial problems began in 2012, when the General Services Administration accepted the Trump Organization’s bid to lease D.C.’s Old Post Office from the government and operate the 1899 Romanesque Revival building as a luxury hotel. Industry experts told the Washington Post at the time that for the Trump Organization to justify its $200 million investment and $3 million in annual rent payments, the hotel’s average room rates would need to be the highest in the city by about 50 percent. (Ivanka Trump, then an executive at the Trump Organization, said the calculations were wrong.)

Advertisement
Advertisement

2012 math though didn’t factor in the owner being elected president two weeks after the hotel’s 2016 grand opening. Room rates that already had been slashed enjoyed a V-shaped recovery to among the highest in the city, embassies swooped in to rent the private events spaces (like Azerbaijan for its 2016 Hanukkah party), and the lobby bar became the favorite watering hole of both established and emerging swamp creatures. While the Trump Organization had projected its new Pennsylvania Avenue venture would lose $2.1 million in the first four months of 2017, confidential financial reports that the GSA mistakenly uploaded to its website later showed that instead the hotel had a $1.97 million profit in that period. To the chagrin of anyone who knew how to pronounce emolument, Trump’s presidency seemed like an instant boon to his business.

Advertisement

But even with the hotel benefiting from presidential perks—like a Saudi Arabia–backed lobbyist booking 500 nights of rooms for U.S. veterans, T-Mobile execs dropping $195,000 after they announced merger plans that would need government approval, and the main opposition candidate for Nigeria’s presidency popping in just one month before his country’s election to prove he was in fact allowed to enter the United States—the business apparently did not stay profitable, at least not for long. According to Trump’s tax records obtained by the New York Times, through 2018 the hotel lost $55.5 million. (Then again, the original source of the Trump Hotel D.C.’s financial information, the Trump Organization, has a history of tweaking its accounting to suit its best interests.)

Advertisement
Advertisement

In fall 2019, when the Trump Organization tried to unload its lease to a new operator, many offers came in at less than half of the $500 million the Trumps had hoped for, CNBC reported.

Then came the COVID-19 pandemic, which intermittently shuttered the hotel’s bar and restaurant business throughout 2020 and into 2021. “America’s Living Room,” as the hotel’s manager likes to bill the lobby, suddenly resembled the deck of the Titanic—empty and underwater. On his government-mandated financial disclosures, Trump reported his share of the hotel’s revenue (before any losses) was $40 million in each of his first three years in office; in 2020 that figure plunged to $15.1 million.

With Trump’s election defeat, his D.C. hotel has entered a new era: one in which it’s no longer owned by the sitting U.S. president and its leaseholder is no longer also the landlord.

Advertisement

This matters for far more than symbolic reasons. For the duration of the Trump administration, GSA officials were such strong defenders of Trump’s ownership of the hotel it seemed that they might be paid in Trump Card points. One contract officer ruled that the president’s ownership didn’t violate the lease despite a clause barring elected officials from becoming party to it. GSA’s long-standing plans to relocate the FBI headquarters, located across the street from the hotel, were scuppered, blocking that property from possibly being redeveloped as a rival hotel (House Democrats alleged, with evidence, that Trump meddled in that decision). And GSA’s administrator refused to comply with a subpoena to release unredacted financial documents to a House panel with oversight of the lease.

Advertisement
Advertisement
Advertisement

While Trump’s return to private life has meant the dismissal of two lawsuits alleging his ownership of the hotel violated the Constitution’s clauses prohibiting the president from receiving income from other governments, the business still faces legal problems. No longer likely to be stifled by Trump apparatchiks at GSA, Democratic Reps. Peter DeFazio of Oregon and Dina Titus of Nevada, who chair the panels with oversight of GSA’s leases, have said their investigations will continue. D.C. Attorney General Karl Racine’s lawsuit accusing Trump’s hotel and inaugural committee of allegedly abusing nonprofit funds when the former charged the latter $1.03 million for four days of event space is working its way toward a trial. And Maryland’s Republican governor, Larry Hogan, has revived the push to move FBI headquarters away from downtown, possibly opening up the Trump Hotel D.C. to new competition after all. D.C. Del. Eleanor Holmes Norton did tell DCist, though, that it’s unlikely the government would force the Trump Organization to relinquish its lease—so if no one’s buying at the price they want, the Trump Hotel may not be going anywhere.

Advertisement

Now, the hotel can count on neither tributes from governments and industry nor the protection of a self-interested landlord, while Trump has $170 million in loans on the property due by 2024. He personally guaranteed them and refinancing doesn’t seem like an option. His longtime lender, Deutsche Bank, is among those businesses trying to dump Trump, having finally decided he’s bad for business. Trump’s options include selling assets to pay off the loan or finding another company willing to lend a serial defaulter $170 million, give or take, to support an ostensibly money-losing business.

And yet: Trump’s D.C. hotel is still poised to reap the benefits of some partisans who don’t know—or refuse to acknowledge—that the Trumpworld celebrities have petered out, the Champagne sabers are sheathed, and the party is winding down.

Like on March 4, the original inauguration date for U.S. presidents. Many followers of the QAnon hoax believe Trump will regain the presidency that day and finally vanquish the Deep State. The cheapest rooms at the Trump Hotel D.C. that night start at more than $1,300.

Advertisement