Former President Donald Trump's hotel in Washington, D.C., incurred more than $70 million in operating losses during his time in office, forcing him at one point to get a reprieve from a major bank on payments on a loan, according to documents released Friday by a House committee investigating his business.
The House Committee on Oversight and Reform said Trump reported the hotel on Pennsylvania Avenue generated more than $150 million in profits during his presidency. Trump "grossly exaggerated the financial health" of the hotel, according to the panel, noting documents show the Trump Organization had to inject $27 million from other parts of its business to help the hotel.
The committee said financial statements it obtained show the losses came despite an estimated $3.7 million in payments from foreign governments, business that government ethics experts say Trump should have refused because it posed conflicts of interest with his role as president and raises “concerns about possible violations of the Constitution’s Foreign Emoluments Clause.”
“By filing these misleading public disclosures, President Trump grossly exaggerated the financial health of the Trump Hotel,” the committee said in a news release. “He also appears to have concealed potential conflicts of interest stemming not just from his ownership of this failing business but also from his roles as the hotel’s lender and the guarantor of its third-party loans.”
The Trump Organization said in a statement that the findings of the Democrat-led committee were misleading and false, and it did not receive any special treatment from a lender.
“This report is nothing more than continued political harassment in a desperate attempt to mislead the American public and defame Trump in pursuit of their own agenda,” the company said.
The documents from the committee, the first public disclosure of audited financial statements from the hotel, show steep losses despite a brisk business while he was in office from lobbyists and businesses and Republican groups.
The decision by Deutsche Bank to allow the president to delay making payments on a $170 million loan was an “undisclosed preferential treatment” that should have been reported by the president because Trump personally guaranteed that loan and the bank has substantial business in the U.S., the committee said in a letter to the General Services Administration, the federal agency overseeing the hotel. The hotel is leased by the federal government to the Trump Organization.
“The documents ... raise new and troubling questions about former President Trump’s lease with GSA and the agency’s ability to manage the former president’s conflicts of interest during his term in office when he was effectively on both sides of the contract, as landlord and tenant,” the committee, overseen by Democrat Carolyn Maloney of New York, wrote in a news release.
The GSA did not immediately respond to a request for comment.
When Trump first applied to lease the Old Post Office Building in 2011 for his hotel, he also provided the federal government with information that the committee said “appeared to conceal certain debts.” Records show Trump specifically didn’t show outstanding balances for properties he owned in other major cities like New York, Chicago and Las Vegas, the panel said.
Trump's company has been trying to sell the 263-room hotel since the fall of 2019 but has struggled to find buyers during the coronavirus pandemic at a reported initial asking price of more than $500 million.
The head of government ethics watchdog CREW said the losses shed new light on Trump's refusal to ban foreign governments from patronizing his business.
“The only lifeline was the corrupt business coming from people and organizations and governments seeking to influence him," said Noah Bookbinder, president of Citizens for Responsibility and Ethics in Washington. "His use of the presidency to get business was absolutely essential to stemming the flow of losses.”
To allay concerns about possibly profiting off foreign governments, Trump promised to send payments to the U.S. Treasury on earnings from his business annually. The payments totaled $356,000 for the first three years of his presidency. Critics of the voluntary deal say Trump's definition of earnings is unclear and gave the president plenty of room to lowball the figure.
Though the Washington hotel was hurt badly by pandemic-related shutdowns last year, the audited financial statements released by the committee show it was suffering every year it was open before that, too. It lost a nearly $50 million in the first three years of his presidency, then $22 million last year.