“While we were seeing encouraging signs of growth and recovery, that momentum tempered down towards the end of October, with rising covid cases nationwide,” said Matthew Vandegrift, the hotel’s general manager, said in a conference call with the investors, who own individual rooms in Trump’s hotel. “The momentum we were experiencing has slowed as of late November.”
Another executive said that to break even, the Trump hotel — on Central Park West — needs to be about 70 percent full, with guests paying $600 per night. Since the start of November, they said, the hotel was been about 16 percent full.
Another sign of the downturn at Trump’s hotel: on Tuesday chef Jean-Georges Vongerichten — who operates a high-end restaurant on the hotel’s first floor — said the Trump Organization had agreed this year to cut his rent by about 25 percent.
The restaurant was hurt by New York lockdown restrictions, which temporarily closed indoor dining and forced the restaurant to lay off 216 employees. Indoor dining has reopened in New York, but — as cases surge — Mayor Bill de Blasio (D) has said it will probably be shut down again soon.
Vongerichten said he might ask for further discounts from Trump’s company if business does not rebound in 2021. “We have no idea” what to expect, Vongerichten said in a phone interview with The Washington Post.
The New York hotel’s unusual management structure means that while Trump’s company is paid to operate the hotel, it does not own the building. Instead, the individual hotel rooms were sold off years ago to investors who wanted a share of the profits.
Now, executives said on the call, those investors are expected not to reap any profits this year — and instead have to send money to keep the hotel operating.
One executive listed the losses for each category of hotel room, which added up to about $9 million for the full hotel in 2020, according to a Washington Post calculation. The hotel expected more losses in 2021, executives said: The totals added up to $7.5 million hotel-wide, according to The Post’s calculation.
On the call, one investor asked for clarification: “Besides the money we unit owners have been losing in 2020, do we still have to wire more money?”
“You’re certainly going to have to wire more money for 2021,” said Douglas Russell, who chairs the building’s board. Donald Trump Jr., the president’s son, is a member of the board. He was on the call but spoke only sparingly.
The Trump Organization typically earns more than $1 million a year in management fees from this hotel, according to the president’s financial disclosures. It was unclear whether that figure would change in 2020.
Neither Russell, Vandegrift nor the Trump Organization responded to requests for comment Tuesday.
While he is in office, Trump has handed control of his business to his sons Trump Jr. and Eric. If Trump returns to lead the company after he leaves office next year, the pandemic will be among the most pressing issues he will face.
Trump’s company — heavily dependent on travel and hospitality — has been hit hard by the pandemic, prompting hundreds of layoffs across the company and the long-term shutdown of Trump’s hotel in Vancouver, B.C.
On the call Monday, Trump hotel executives said they had furloughed about 80 employees in New York since the pandemic began.