June 5, 2017 at 11:35 PM
by Jonathan O'Connell
NEW YORK — President Trump's hotel company is pushing into territory he conquered as a political candidate, beginning with four new hotels in Mississippi.
The company will open the first of its Scion line of hotels — marketed as a four-star boutique brand — early next year through a deal the company inked for a property under construction in Cleveland, Miss., population 15,800.
The Trump Organization also announced three hotels under a new brand called American Idea, building off experiences Donald Trump Jr. and Eric Trump said they picked up on the campaign trail supporting their father in communities far from Trump Tower, where they grew up and made the announcement Monday night at a cocktail reception for hotel executives.
"Eric and I got a great crash course in America over the last two years," Donald Trump Jr. said to the crowd of about 500. "We saw so many places and so many towns and heard so many stories that were so touching. People that were so excited about the prospect of this country and Americana in general."
"We started talking, Eric and I, as brothers, and saying, 'You know what, there's something here, there's a market here that we've been missing our entire lives by focusing only on the high end,' " he added.
The deals mark the first new projects the company announced since Trump left the business for the White House and are overshadowed by the president's decision to retain ownership of his company while in office.
The president's refusal to divest, over the objections of the government's top ethics official, has raised questions about whether he could profit from his position in the White House — issues that are likely to dominate as his company pushes an aggressive expansion.
All four Mississippi deals are franchise agreements for hotels owned by a family-run firm headed by Indian American brothers, Dinesh and Suresh Chawla. They own 17 hotels in the Gulf Coast region, including three in Cleveland, Clarksdale and Greenville, Miss., that will be converted to American Idea hotels.
The properties will be owned by the Chawla family. The Scion, which is under construction, is a $20 million project financed by $5 million from Guaranty Bank, Dinesh Chawla said. It will become the nation's first Scion hotel under a deal signed with Eric Danziger, chief executive of Trump Hotels.
All of the hotels will be priced lower than the luxury brand Trump minted with his name before running for president, offering rates that working-class voters in Mississippi and elsewhere can more easily afford.
Many more deals are on the way. Danziger said he had agreed to 39 letters of intent — informal preliminary agreements — for other hotels across the country.
The Chawla brothers said their father was a refugee in India before emigrating to Canada and then the United States. Thirty years ago, they said, their father called Donald Trump asking for advice, and Trump called him back.
Whether the hotels will trade on Trump's power and popularity remains to be seen. Donald Jr. and Eric Trump remain adamant that the brands will not feature the Trump family name, to preserve its status as a luxury brand with outposts in Soho, Washington, Chicago and Las Vegas.
"The Trump name is reserved for the Turnberrys of the world," said Eric Trump, referring to the company's Scotland golf resort.
Dinesh Chawla described himself as a social liberal and said he would like the Mississippi Scion to become a stop for tourists on the Mississippi Blues Trail and visitors to the Grammy Museum Mississippi, which opened recently nearby.
"As far as president Trump, I am an immigrant," he said. "I have sympathy for people who are refugees. I would do anything as far as supporting them financially; I think that it's very important that we do help people like that. But I do believe in legal immigration — not to punish people, but I believe in being a law-abiding person."
Suresh Chawla, who noted that his father's hero was former president Bill Clinton, said the hotel would succeed based on its service and not on politics.
"What's important to the hotel is whether there are clean rooms and a quality experience," he said.