This Is Why Trump Will Need A Lot More Than $540 Million

Forbes

Even if former President Donald Trump figures out how to pay his mounting legal fees, he’s still going to be scrambling for cash for years to come. Forbes staff writer Zach Everson joins "Forbes Talks" with Brittany Lewis to discuss.  Read the full story on Forbes: https://www.forbes.com/sites/zacheverson/2024/03/07/why-trump-will-need-a-lot-more-than-540-million/?sh=228d1f651d86  Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1  Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:  https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript  Stay Connected Forbes newsletters: https://newsletters.editorial.forbes.com Forbes on Facebook: http://fb.com/forbes Forbes Video on Twitter: http://www.twitter.com/forbes Forbes Video on Instagram: http://instagram.com/forbes More From Forbes:  http://forbes.com  Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.

Transcript

00:00 Hi, everybody. I'm Brittany Lewis with Forbes breaking news. Joining me now is my colleague,

00:07 Forbes staff writer, Zach Everson. Zach, thanks so much for joining me.

00:10 Thanks for having me, Brittany.

00:13 Of course, over the past year, you along with your other colleague, Kyle Mullins, and I

00:18 have been talking about former President Donald Trump's wealth, his legal challenges, and

00:23 how that is impacting his fortune. You posed this question for Forbes recently, why Trump

00:29 will need a lot more than 540 million dollars. So first, can you remind us how we got to

00:34 the 540 million dollars number in the first place?

00:38 Sure. That is the result of two lawsuits, one of which was filed by E. Jean Carroll

00:44 regarding the sexual assault. And that was she won eighty three point three million dollars.

00:50 I think it was in that suit. The remainder comes from the New York attorney general's

00:54 civil civil fraud suit against the former president.

00:57 Clearly, this is an expensive problem when you're talking about anything that costs over

01:02 half a billion dollars. Can he afford it?

01:07 It's going to be tight. You know, I think he can move some things around, but and maybe

01:12 sell some things or take out some loans somehow. There's the possibility of him being able

01:17 to offload some of the shares that he has in some of his ownership stake rather in Trump

01:22 media after that merger goes through. But it's it's not going to be life as usual for

01:27 the former president.

01:29 You wrote this in your piece for Forbes, quote, he's still going to be scrambling for cash

01:34 for years to come. Why is that?

01:36 Well, on top of the five hundred forty million dollars that he owes and fines, he has another

01:42 seven hundred and eighty million dollars in loans coming due next five years. So that

01:47 would take us till the end of the next presidential term.

01:52 Huge amount of numbers, short span of time. Let's break it down a little further. Who

01:56 does he owe the money to? What are these properties? Break it down for us.

02:01 Sure. It's a variety of banks for the most part. The first one is due in July. So not

02:08 all that much time. It's twelve million dollars for Trump Plaza, which is not to be confused

02:13 with the Trump Plaza casino that went under and went bankrupt or the Plaza Hotel that

02:18 Trump owns that also went bankrupt. This rather is a building on the Upper East Side of Manhattan.

02:24 And what property does he owe the most to?

02:28 There are two properties that he is a minority owner to, along with a group called Vornado.

02:36 And they are have pretty heavily leveraged on one of them out in San Francisco. He owed

02:42 his share of their debt is three hundred sixty million and another one in New York. His share

02:46 of the debt is two hundred and eighty four million. And he's a little bit handcuffed

02:50 in these because he is largely needs to follow on whatever Vornado's wishes are, has to how

02:57 to handle that debt. So that's that's not something he has a lot of flexibility with.

03:01 He has some properties in New York, but what other areas are these properties in?

03:06 Well, you've got the New York City, you've got the one I just mentioned in California.

03:12 You have Durao, the golf course down in Miami, and you also have Seven Springs, which is

03:17 the estates that he owns in upstate New York.

03:22 Who are the creditors or lenders? Are they all the same bank? What does that look like?

03:27 Well, it gets a little complicated here because a lot of these loans were collateralized in

03:33 terms of after they were made, they were chopped up, packaged together with other mortgages

03:38 and sold off to investors. So in some instances, it appears that it's, you know, if something

03:43 were if we were to default on these, it would be the individual investors who would be on

03:48 the hook. Some of the loans originated with the latter capital. That is a Jack Weisselberg,

03:55 the son of Allen Weisselberg, the former Trump CFO who recently pleaded guilty to perjury.

04:01 His son worked there at the time. You know, famously, we're not seeing Deutsche Bank in

04:05 any of these. That's obviously one of the big lenders that comes to mind when people

04:09 think Trump. But they have washed their hands of him by this point.

04:13 Talk about that a little bit for us. Refresh our minds. Why is Deutsche Bank top of mind

04:18 when people think about Trump?

04:21 They famously loaned him a lot of money, and that was even after he had stiffed them and

04:25 sued them. And then they continued to lend money to him and gave him favorable rates

04:29 and a favorable treatment. You know, his personal banker there really seemed to go out of her

04:33 way to argue that the bank should continue to do business with Trump. And, you know,

04:38 at the end, it didn't seem to be like a great business decision on their part. And it certainly

04:42 wasn't great for their reputation either.

04:45 So are you surprised that Deutsche Bank isn't listed here when you lay out his debt like

04:49 this?

04:50 No, it was just a little bit of a reminder as I was going through this reporting this

04:55 article out when I saw their name as one of the previous lenders for for Durao before

05:02 he renegotiated that mortgage that they popped up. They were like, oh, yeah, Deutsche Bank.

05:08 I remember them. So it was just kind of a little flash from the past. In that case,

05:12 Durao and Trump Tower are both been refinanced two years ago with Axos Bank, which started

05:19 off with the name something along the lines of the Bank of the Internet. So that's that's

05:23 who he's been doing business with most recently.

05:26 And when does he have to pay? I know you said one payment starts in July. What does that

05:31 schedule look like?

05:33 So the first payment is, yes, in July. And it's twelve million dollars. So it's either

05:37 pay or refinance or come up with some other way to satisfy that debt. Then he has another

05:42 year where he's going to owe one hundred twenty one million dollars on his 40 Wall Street

05:48 bill business, our building. And then the last one, I mean, they go all the way out

05:51 to twenty forty eight, which is one of his properties in Palm Beach residence. So, you

05:57 know, at that point, Donald Trump would be one hundred and two when that mortgage comes

06:00 due. So I don't suspect he's really worried to move to worry about it.

06:06 When you added this up, you got the number seven hundred and eighty million dollars.

06:10 How is he going to afford this?

06:13 Well, that's and that's just in the next five years. Overall, it totals a billion dollars.

06:18 He's been in this hole before. We ran an article previously about how he had all this debt

06:22 coming due shortly after he left office and he took care of it. You know, he was able

06:28 to get some money from selling the D.C. hotel, able to refinance some buildings. So, I mean,

06:34 that's probably what he's looking to. We reached out. They did not respond to our request

06:39 for comment in your reporting. And when you laid out his debt in this way, were there

06:44 any trends that stood out to you?

06:48 You know, the fact that a few of them have been collateralized, that's nothing on his

06:51 part. That was the decision of the lenders to do that. So it was interesting seeing a

06:55 few of those chopped up. The reliance on Axios Bank for his last two for Trump Tower and

07:02 Durao, which is a bank that's not all that widely known. You know, certainly not up there

07:07 with Deutsche Bank or JP Morgan Chase, who had also done business with him previously.

07:12 And their CEO, as we reported a couple of years back, had been a Republican donor, even

07:17 donating money to Trump's reelection efforts.

07:21 When you're laying this all out and you're seeing debt reach a billion dollars, did anything

07:25 surprise you?

07:28 Not really. Trump has called himself in the past the king of debt. It hasn't really been

07:33 true for a while. But the fact that he is this leveraged isn't that much. Isn't that

07:37 too surprising? We have his net net worth. I think it's like two point six billion dollars.

07:41 So it makes sense that he would have a substantial amount of debt, you know, leveraging his his

07:47 real estate empire.

07:49 Was he proud of being called the king of debt? That doesn't exactly sound like a compliment

07:53 to bestow on oneself.

07:55 Well, he he called himself that. And I can't imagine Donald Trump doing anything but complimenting

08:01 himself. So, yes, I imagine he took it as a compliment.

08:05 When it comes to Donald Trump, his legal challenges and the finances surrounding them. What's

08:10 next on your radar? What should we be looking out for?

08:13 I'm really interested in the true social merger. That is the social media company, their social

08:19 media platform that he founded. It's owned by Trump Media. And they have a merger that's

08:24 been going through with a company called Digital World Acquisition Corp. And that that merger

08:29 has been going. They've been trying to get that through for over a year. But the vote

08:32 on that, the SEC recently gave OK for the go ahead and shareholders are voting on that,

08:37 which is most likely going to be a yes.

08:39 So I think we're going to see that in a few months. The former president has a substantial

08:44 share in what the resulting company would be, although it sounds like he's tied up and

08:48 not going to be able to offload those shares for a year. But there might be a way he could

08:52 do it if the board of directors approve. So I think that's one of the biggest things we're

08:55 looking at in the near future regarding Trump's finances.

08:58 Well, you and I talked about the truth social merger before. I'm sure we will talk about

09:03 it again. Zach Everson, per usual. Thank you so much for joining me.

09:08 Thanks for having me, Brittany.

09:09 Thanks, Brittany.

09:10 Thanks, Zach.

09:11 Thanks, Brittany.

09:12 Thanks, Zach.

09:13 Thanks, Brittany.

09:13 Thanks, Zach.

09:14 Thanks, Brittany.

09:14 Thanks, Zach.

09:15 Thanks, Brittany.

09:15 [BLANK_AUDIO]

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