Bank Lenders Demand Answers As Trump's Skyscraper Continues To Lose Revenue

Wells Fargo, the lender that Trump used to finance his skyscraper at 40 Wall Street in New York, sent a letter to Trump asking how he plans to improve the building and its revenue stream after reporting massive losses in both money and tenants. The building is performing well below expectations, and as the lender responsible for it, the banks are demanding answers about how this can improve so they can be sure they'll get their money back. Ring of Fire's Farron Cousins explains what's happening.

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*This transcript was generated by a third-party transcription software company, so please excuse any typos.

Donald Trump may be having a little bit of financial troubles with his building his skyscraper at 40 Wall Street in the city of New York. That is, by the way, the same skyscraper that after nine 11 Donald Trump boasted, Hey, I've now got the tallest building, but he owns the building. And in 2015 he had to take out another mortgage on it. And the bank, Wells Fargo stepped up to give him the, uh, what was it, I think 400, uh, 540 million to uh, you know, have that mortgage going so he could afford to have the building. And now Wells Fargo, according to reports, has sent a letter to the Trump organization saying, Hey, your building is doing really poorly. Your hemorrhaging money, your hemorrhaging tenants. And because we hold the mortgage and you still owe us hundreds of millions of dollars here, uh, we would like a report from you about how you're gonna fix this. How are you gonna write the ship Trump organization? Cuz again, we're holding the mortgage here and we're starting to get worried that you're not gonna be able to pay it.

That's pretty bad. It gets even worse when, you know, the statistics, uh, the vacancy rate at the building has jumped to 18% in the third quarter of last year. Um, expenses have risen by 11% since the origination of that 2015 mortgage. So our expenses went up, the number of people paying monthly rent went down. So effectively, if this trend continues, maybe not right at the moment, but if the trend continues, you're gonna be underwater pretty quickly, and then you're not gonna have enough money to pay off that mortgage, which is of course what we mean when we say that Donald Trump is cash poor because the building is appraised for more than half a million, uh, half a billion dollars. So that goes to Donald Trump's value, his net worth, but you don't have that money to spend because it's all tied up in bricks and mortar. So you're wi rich, you're wealthy, you have a lot of assets, you just don't have a lot of cash, which is what's worrying the bank when they look at your financial statements that you send to them every quarter and they see, oh God, these people are losing money hand over fist and we're gonna be stuck holding the bag when they can't pay the mortgage here.

But I think another thing could be in play here. I think what might be worrying Wells Fargo a little bit is all of the other news out of the city of New York about Donald Trump and his organization over-inflating the value of businesses, lying to banks and all the other things that, uh, they've been sued by the New York Attorney General for allegedly doing. And I think Wells Fargo is starting to get a little antsy. They're looking at these lawsuits, looking at the fact that the Trump organization might end up being dissolved as a result of them. And they're saying, oh crap, we need to get our money now because there may not be an entity to get money from six months from.