The Trump Organization owns an office building at 40 Wall Street in Manhattan. In 2012, when the company was listing its assets for potential lenders, it said the building was worth $527 million — which would make it among the most valuable in New York.
But just a few months later, the Trump Organization told property tax officials that the entire 70-story building was worth less than a high-end Manhattan condo: just $16.7 million, according to newly released city records.
That was less than one-thirtieth the amount it had claimed the year before.
That property is now under scrutiny from the Manhattan district attorney and New York attorney general, along with several others like it for which the Trump Organization gave vastly different value estimates, according to public records and people familiar with their investigations who spoke on the condition of anonymity to discuss ongoing inquiries.
After the indictment of the Trump Organization’s chief financial officer this summer for income tax fraud, prosecutors now appear to be examining whether the company broke the law by providing low values to property tax officers, while using high ones to garner tax breaks or impress lenders.
New York Attorney General Letitia James (D) has said she is considering a lawsuit, and prosecutors in the Manhattan District Attorney’s Office have also convened a new grand jury, which could vote on criminal charges, according to the people familiar with the investigations.
Among the other properties under scrutiny: former president Donald Trump’s California golf club, for which he valued the same parcel of land at $900,000 and $25 million depending on the intended audience, and an estate in suburban New York, for which Trump’s valuations ranged from $56 million up to $291 million. The valuations were all given in the five years before Trump won the presidency.
Prosecutors appear to have dug deeply into these properties, according to court papers and people familiar with the investigation. They have compiled reams of emails, planning documents and financial data, even seeking the initiation fees Trump charged golf club members as far back as a decade ago. In Los Angeles, they have asked for geology reports on the rock layers under Trump’s course — where the value was affected by a history of landslides.
They have also sought detailed records from two outside companies that worked with the Trump Organization to formulate these valuations: appraisal firm Cushman & Wakefield and law firm Morgan Lewis. In court filings, prosecutors have referred to emails in which they said Trump executives or a Morgan Lewis lawyer pushed appraisers to change their findings. Neither Morgan Lewis nor Cushman & Wakefield responded to questions.
Real estate appraisers said it was highly unusual for any property owner to give such widely different values for the same property during the same time period.
“This is way, way beyond anything that’s believable,” said Norm Miller, a professor of real estate finance at the University of San Diego who has appraised properties for 50 years. “I’ve never seen anything with a gap that extreme.”
But extreme is not the same as illegal. Legal experts said that if prosecutors wish to prove a crime, they will need to do more than simply prove Trump’s valuations were wrong.
“Is it an overly optimistic? Is it an enthusiastic perception?” said Robert Masters, a former top aide to the district attorney in Queens. “Does that make it a lie?”
Masters said prosecutors would probably need to show that the figures were wrong on purpose — falsified deliberately, with an intent to deceive a lender or the government. Masters said that may require a witness on the inside, who could explain the decision-making behind the numbers.
“Is there somebody there who can translate the books?” he said.
The Trump Organization declined to comment for this article. Trump’s political office did not respond to questions. In the past, Trump has said the New York investigations are a political attack by Democrats: “an investigation that is in desperate search of a crime.”
Monday, November 22, 2021
It's Thanksgiving, and that means light posting this week. Still, there should be a lot to talk about, and there's a lot to be grateful for still, like you folks who still read me after 13 years.
Have a peaceful week, folks. I'll be along later today.