Wall Street Journal Journal
According to the Journal, only about one-third of the 46-story tower's 391 units are in contract, with buying having stalled since the fall of 2007. Additionally, it isn't clear how many of the sales will actually close following the project's April 9 opening.
First announced in 2006 on Donald Trump's hit TV series The Apprentice, Trump Soho does not involve any of Trump's own money. The Trump Organization's involvement with the project is a licensing and hotel-management agreement with the developers, giving Trump and his children Ivanka, Eric and Donald Jr. an 18% equity stake, according to the Journal.
Local zoning prohibited the JV from building an apartment tower offering permanent residence. The developers opted for a hotel-condo model under which owners can only stay there for 120 days out of the year, or 29 consecutive days during any 36-day period. For the remainder of the year, the condo units will be operated as Trump-branded hotel rooms.
By 2013 or 2014, Trump Soho should be able to charge more than $600 a night for a hotel room, Roland deMilleret of hotel consulting firm HVS told the Journal. But for now, deMilleret said, room rates will be limited to the low- to mid-$400s. "During that ramp-up period, they need to rely on condo sales, and that will be challenging," he said. Click here for the complete article.
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Paul Bubny
Paul Bubny is managing editor of Real Estate Forum and GlobeSt.com. He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.
