Posted on: November 2, 2023, 07:56h.
Last updated on: November 2, 2023, 07:56h.
Bally’s (NYSE: BALY) paid the Trump Organization $60 million to acquire the lease on Trump Golf Links at Ferry Point in the Bronx, NY, according to testimony given today by Donald Trump Jr.
The former president’s son and his brother Eric testified today in a civil fraud started by New York Attorney General Letitia James, a Democrat who in 2018 campaigned on suing the then-sitting president. The crux of the prosecution’s case centers on the notion that Trump Organization knowingly and purposefully inflated the value of its various real estate holdings to procure large loans from banks.
Reports surfaced in September that the lease on Trump Golf Links at Ferry Point had been transferred to Bally’s, but prior to today, the transaction had not been mentioned in Judge Arthur Engoron’s courtroom. Trump Jr. confirmed that his family’s company sold the lease to the regional casino operator for $60 million, but he wasn’t sure about the net profit on the deal because the Trump Organization had incurred “a lot of costs” running the venue. Some of those costs may be attributable to legal bills.
The city and the Trump Organization reached a deal in 2015 to extend that lease by 20 years. In 2021, former New York Mayor Bill de Blasio — a Democrat — attempted to terminate that pact, citing the Jan. 6, 2021, riot at the US Capitol building in Washington, DC. No criminal court has found the 45th president guilty of January 6-related crimes, and in April 2022, a Manhattan Supreme Court judge ruled that de Blasio was wrong to scrap that agreement.
Bally’s Likely Paid Fair Price
Prior to today, there was speculation that Bally’s could pay upwards of $100 million, possibly more, to acquire the golf course lease, indicating that the casino operator may have gotten a fair deal in paying $60 million.
It’s believed that both the gaming company and the Trump Organization were eager to finalize the transaction. The Trump Organization is said to have approved the deal because the negotiations had been ongoing and that if reached for more money, the sale may have fallen apart. Likewise, Bally’s faced a time crunch to get its hands on the lease so it could procure permitting necessary for its New York City casino bid.
Perhaps to the delight of some in left-leaning New York, Bally’s made good on its promise to pull the Trump name from the golf property. The venue is now known as Bally’s Golf Links at Ferry Point, according to the casino operator’s website.
Eric Trump, who is described by the New York Times as “very tall,” is scheduled to continue testifying tomorrow. He’s said to be more involved in the day-to-day operations of the Trump Organization than Don Jr.
Potential Implications of Golf Course Transaction
It remains to be seen, but it’s possible that with Bally’s likely having paid a fair price for the Bronx golf course lease, some damage could be done to the thesis that the Trump Organization engaged in unscrupulous business practices.
On the other hand, right-leaning critics claim the trial is a farce, pointing to James’s campaign pledges and Engoron’s thousands of dollars in contributions to Democrat candidates over the years. Last year, the judge referred to the former president as a “bad guy.”
Additionally, commercial real estate experts argue that the prosecution is conflating the difference between appraised and market value. Whether it’s commercial or residential real estate, appraised values are typically used for tax purposes, nothing more, and are usually well below market prices. For example, a house may be appraised at $500,000, but if the neighboring properties are selling for $1 million, it’d stand to reason that the owners of the $500,000 house will ask for $1 million or more in a sale.
