In 2006, Trump’s company was selling condo’s at Trump Ocean Resort Baja. Before construction on the property even began 188 units were sold for $122 million in one day at a December. Units for the Mexico property were selling for $300,000 to $3,000,000 and buyers had to put down 30%. In 2009, Trump removed his name from the property and the project has folded. The buyers were left with nothing. No property, no refund.
The sellers prevented significant information from the people who bought the units. There were many important details that were left out, as well as false information that was given. Buyers can’t be blamed for this! That is a civil issue! The buyers believed that the units were “Trumps property”, whereas Trump simply licensed his brand to another company. In fact, he wasn’t even an investor. In addition, the state of the company was not as good as the buyers were led to believe. They may have been able to demand their money back if only they had known so.
People who spoke against Trump in this case:
Anonimus – “After the Donald screwed thousands of investors and banks out of hundreds of millions in Atlantic City directly due to poor management, how can anyone believe in him?? The net, twitter etc., are fraught with schemes to get rich quick all fronted by the Donald. The only one that may prosper is, guess who, the Donald. I simply don’t trust him. If you are in the magnificent one’s presence watch your wallet.”
A group of seven individuals filed (March 2010) a $10M lawsuit against Donald Trump, Donald Trump Jr., Ivanka Trump and others for fraud, negligence, accounting and other counts. Their claims:
1. They were swindled by Trump. They were led to believe that Trump was directly involved when instead it was a licensing deal. The lawsuit produces evidence including newspaper stories to prove that the project was widely known as a Trump project and that Ivanka Trump and Donald J. Trump, Jr. attended key sales events for the project and announced that they would be purchasing units in the project.
2. Trump and the developer Irongate did not have financing and construction permits approved before the sales.
3. The site itself had contamination and mold issues.
4. There is an allegation that certain "favored" buyers were allowed to purchase without a deposit while others including the plaintiffs were forced to tender hefty sums before purchase.
Claims about the resort being located in a polluted area (December 2006) - North of Baja's Punta Bandera, 30 million gallons of sewage are discharged daily on the beach. Prospective buyers should be informed, so they can ask developers about health risks and sewage collection.
http://www.radaronline.com/sites/default/files/trumpcourtdocs38.pdf
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also found that:
ReplyDeleteDeposits totaling $32.2 million are lost in the collapse of the celebrity developer's hotel-condo project.
March 07, 2009|Associated PressSAN DIEGO —
Trump Baja venture leaves buyers high and dryStephen and Linda Drake cast aside concerns about owning property in Mexico because they believed in Donald Trump.
The Southern California couple made a $250,000 down payment on a 19th-floor oceanfront condo in Trump Ocean Resort Baja in 2006 before the first construction crew arrived.
But admiration for the celebrity developer and star of "The Apprentice" has now turned into anger and disbelief as Trump's luxury hotel-condo plan collapsed, leaving little more than a hole in the ground and investors out of their deposits, which totaled $32.2 million.
"I can't even stand to see Trump's face on TV," said Linda Drake, a psychologist whose husband is a commercial airline pilot and financial advisor.
Investors were told last month that their money was spent and that they wouldn't get a penny back. A single mother in suburban Los Angeles lost $200,000 and won't be able to send her sons to private universities. A Los Angeles-area businessman lost a deposit of more than $1 million on four Trump units, including two penthouses.
The project's collapse comes at a delicate time for Trump, whose casino company, Trump Entertainment Resorts Inc., filed for bankruptcy protection last month. He also is embroiled in a lawsuit to avoid paying debt on the struggling Trump International Hotel and Tower in Chicago.
Trump and his children heavily promoted the northern tip of Mexico's Baja California coast. He sold 188 units for $122 million the first day they went on a sale at a lavish event in a downtown San Diego hotel in December 2006.
"I went out and saw this site, and I was blown away by it," Ivanka Trump said in June 2007. "From the minute I saw it, it was a deal I had to do."
The location was a contrast to more-expensive Mexican coastal markets such as Puerto Vallarta, Los Cabos and Cancun, she said.
The Trumps remained buoyant even as the U.S. housing market began to crumble. Ivanka Trump assured buyers in an October 2007 newsletter that all Trump projects were immune to a slowdown.
"In characteristic Trump fashion, Trump Ocean Resort Baja will be the best of the best, and consequently always in demand," she wrote.
All that remains of Trump Baja is a highway billboard with a large photo of Donald Trump that advertises condos for sale. It hovers over a closed sales center and showroom, a paved parking lot, a big hole that cuts a wide swath, drainage pipes and construction equipment
http://articles.latimes.com/2009/mar/07/business/fi-trump7