Fort Lauderdale, Florida –
How much is Donald Trump’s Mar-a-Lago worth? A New York state judge said the former president’s Florida property was worth at least US$420 million, and possibly US$1.5 billion. The court ruled that the company had exaggerated its value, and this point is at issue.
Judge Arthur Engoron, who sided with New York’s attorney general in a lawsuit accusing President Trump of grossly overvaluing his assets, found that Trump consistently exaggerated the value of Mar-a-Lago. did. He noted that Trump’s estimate of the club’s value is 2,300% times the Palm Beach County tax appraiser’s valuation, which ranges from $18 million to $37 million.
But Palm Beach real estate agents who specialize in luxury properties scoffed, saying that even if Mr. Trump were to sell, the property might not be worth that much.
Attorney Lisa Pulitzer called the judge’s use of the county’s tax valuation as an indicator “ridiculous.” In the town of Palm Beach, a wealthy island enclave, homes one-tenth the size of Mar-a-Lago on small landlocked lots sell for that price.
“When I saw those numbers, I felt like the whole real estate industry was a joke,” said Pulitzer, who works for the firm Brown Harris Stevens.
“Things like that would sell for hundreds of millions and hundreds of millions of dollars,” said Rob Thomson, owner of Waterfront Properties and a member of Mar-a-Lago. “There’s no chance of it selling for $40 million or $50 million.”
But the ongoing court case surrounding the case suggests that how much private buyers pay for places like Mar-a-Lago is the only factor determining whether President Trump is liable for fraud. isn’t it.
What is Mar-a-Lago?
The 126-room, 62,500 square foot (5,810 square meter) mansion is President Trump’s primary residence. It’s also a banquet hall with a club, private beach resort, historic artifacts, and a gold-leafed ballroom. That’s where Trump kept government documents that federal prosecutors say he illegally removed after leaving office in 2021.
Mr. Trump has long acknowledged using “true exaggerations” in his business dealings, but calling Mar-a-Lago unique is no exaggeration.
Built in 1927 by grain heiress Marjorie Merriweather Post and her second husband, investor E.F. Hutton, its 17-acre (7-hectare) property extends out from the Atlantic Ocean, giving her the nickname “Sea” in Spanish. Its name means “From to the Lake”. To the coastal waterway.
Post kept the mansion after the couple’s divorce and used it to host lavish celebrations. In 1969, Mar-a-Lago was designated a National Historic Landmark.
Post, who died in 1973, bequeathed the land to the U.S. government as a presidential winter retreat, but Richard Nixon, Gerald Ford, and Jimmy Carter never used it. The government returned it to the Post Foundation in 1981, citing high maintenance costs.
The property has fallen into disrepair. Trump bought it in 1985 for about $10 million, the equivalent of $30 million today. He invested heavily in its renovation.
But by the early 1990s, Trump was in financial trouble after several business ventures failed. He told Palm Beach city officials that he could not afford the US$3 million annual maintenance costs and proposed dividing the property and building a mansion. The town rejected the plan.
Negotiations continued, and in 1993 the town agreed to let him turn the property into a private club, giving him cash flow that could be used for upkeep. He built a banquet hall but gave up development rights.
The agreement limits club membership to 500 people, with an initiation fee of US$500,000 and annual dues of US$20,000.
Trump typically stays at Mar-a-Lago from October to May before spending the summer in New Jersey.
So what is the value of Mar-a-Lago?
That’s hard to say. The biggest problem is that there are no comparable properties. No one builds mansions like Mar-a-Lago in Palm Beach anymore, and those that did exist were long ago torn down, demolished, or turned into museums.
In his April deposition, President Trump justified his belief that Mar-a-Lago is worth $1 billion by comparing it to prices comparable to the Mona Lisa and Renoir paintings. A one-of-a-kind item that the ultra-rich will pay a premium for.
Eli Beracha, dean of Florida International University’s Hollo School of Real Estate, agrees that valuing unique real estate is difficult. The fact that Trump owned Mar-a-Lago will likely increase its sale price.
“Some may argue that not everyone likes Trump, so some people may actually pay less.…But the highest bid is probably Trump’s. It will be someone who buys it,” Beracha said. .
Pulitzer said the minimum price for Mar-a-Lago would be $300 million. Mr Thomson said it was at least US$600 million. If ultra-billionaires participate in a bidding war, it could be sold for more than $1 billion.
The much smaller Palm Beach estate, once owned by the Kennedy political dynasty, was sold three years ago for $70 million.
So how did Palm Beach County come up with such a low tax assessment?
The county pegs Mar-a-Lago’s current taxable value at $37 million based on the club’s annual net operating income, not its residential resale value or reconstruction costs. It is one of nine private clubs in the county that are taxed in this manner.
Becky Robinson, a spokeswoman for the tax assessor’s office, said this method is important because it is very rare for private clubs to be sold or built, making it impossible to set tax rates in comparison to similar properties. Said to be used. Mar-a-Lago’s property tax bill this year will be $602,000, according to county records.
Rep. Jared Moskowitz, D-South Florida, wrote to the county that if President Trump claims Mar-a-Lago is worth $1 billion, it should be taxed accordingly. Ta. If Mar-a-Lago’s appraised value is his $1 billion, his property tax bill would be about $18 million.
Robinson said the county bases its evaluation on the law and its formula, not on what the owners claim is worth.
Why is it important?
In her lawsuit against Mr. Trump, New York Attorney General Letitia James alleges that Mar-a-Lago was one of several assets that Mr. Trump overvalued in financial statements he submitted to banks and other institutions.
In response to these comments, President Trump valued Mar-a-Lago at a high price of US$739 million, which is a figure that James has requested to use as a social club rather than a private home. He said he ignored regulations. Her lawyers argue that Trump should have valued Mar-a-Lago in the same way as the county in his financial statements, based on its status as a club.
New York lawyers wrote that Trump’s financial statements value the club “based on the false and misleading premise that it is an unrestricted residential property that can be sold and used as a personal residence.” But this was clearly not the case.
Mr. Trump’s lawyers said there was no subterfuge involved and that banks likely did not rely on Mr. Trump’s financial statements in deciding whether to lend him money.
