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The Trump Organization may revive its failed Dominican resort project

This screen image from shows an article about Eric Trump's recent visit to the Dominican Republic. ( via AP)

MEXICO CITY — The Trump Organization appears to have renewed its interest in developing beachfront properties at a luxury resort in the Dominican Republic, according to the Associated Press — a move that could call into question President Trump’s pledge that his company would not launch new foreign deals while he is in office.

Eric Trump, who helps run the firm started by his father, visited the Cap Cana resort Feb. 2 and met with the owners, a trip chronicled in local media. The development is larger than Manhattan and includes polo grounds, hotels and a Jack Nicklaus-designed golf course.

A lawyer for the Trump Organization, Alan Garten, told the AP that efforts to re-engage in a project that began years ago but failed were very preliminary. He said that the deal was never dead, even though the project had seen no new building in a decade.

Garten did not immediately respond to a request from The Washington Post for comment.

A decade ago, Dominican businessman Ricardo Hazoury reached an agreement with Donald Trump to license his name for the construction of the Trump Farallon Estates, intended to feature dozens of clifftop mansions overlooking the Atlantic Ocean. The first day the properties were put up for sale, in May 2007, the Dominican company recorded more than $300 million in sales.

But the financial crisis in 2008 threw the project into disarray, and the Trump estates never materialized. The resort’s finances were “precarious on the best of days and more akin to bungee jumping,” Hazoury’s brother Fernando wrote in a 2009 letter to Eric Trump that became public in court papers. Buyers took steep losses, and a Dominican bank repossessed many of the lots.

Trump’s organization sued Cap Cana in 2012, accusing the company of owing it $14 million. The two sides settled for an undisclosed amount. The land where the Trump Farallon Estates were supposed to be is now overgrown with weeds.

Cap Cana is a large beach resort near the town of Punta Cana in the eastern tip of the Dominican Republic. The Trump Farallon Estates was one of the projects planned inside the resort.

Eric Trump’s trip to Cap Cana last week revived speculation that his organization was interested in getting involved again in the project. The resort issued a statement after the visit saying that Trump had met with Ricardo and Fernando Hazoury, and that “we are enthusiastic to work with the Trump Organization in future phases of the project.”

A spokeswoman for the Hazoury brothers did not respond Thursday to questions about its plans with Trump.

Ethics experts have raised concerns that overseas projects could create conflicts of interest for President Trump, affecting his decision-making on dealings with foreign governments. Sheri Dillon, a lawyer for the president, told a news conference last month that “No new foreign deals will be made whatsoever during the duration of President Trump’s presidency.” Trump remains the owner of his company, although he has put it into a trust managed by his sons.

Asked last month whether there were ongoing projects involving the Hazoury brothers and the Trump Organization, Garten wrote in an email to The Post that “there are no other projects with Mr. Hazoury.”

Some of the buyers of the land in the Trump Farallon Estates project lost millions on the project during the financial crisis, which caused property values to plummet and financing to dry up.

William Ganz III, a Baltimore real estate agent, purchased one of the Trump lots but was not able to finish construction because he ran out of money. He said in a phone interview that he didn’t have details about Eric Trump’s latest plans for Cap Cana but was hopeful.

“I’m kind of just trying to get a state of the union on what’s going on” with the resort, he said. “Maybe now it makes sense for a couple people to put their heads together to finish this project.”

Joel Santos Echevarria, the president of the Association of Hotels and Tourism of the Dominican Republic, said that if the Trump Organization decided to invest again in Cap Cana, “it would be very interesting, because his is a brand recognized around the world.”
“I believe the Dominican Republic can attract the most important investors in the United States and around the world,” he said.

The Hazourys are still being sued by some buyers in Cap Cana who allege that the company did not deliver certain developments that they had promised. The Hazourys have denied wrongdoing.

Gabriela Martinez contributed to this report.

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