The summary ruling found President Trump’s business empire liable for fraudulently inflating property values in loan paperwork.
Former President Donald Trump and two of his sons have criticized a New York judge for suggesting his Mar-a-Lago Palm Beach resort is worth between $18–28 million.
“If Mar-a-Lago is worth $18 million … I’ll take 10 please!!!” Donald Trump Jr., an executive vice president of Trump Organization, wrote on X, formerly known as Twitter.
If my father tried claiming the property was worth $18 million, he would probably then get charged with trying to underpay his real estate taxes!
— Donald Trump Jr. (@DonaldJTrumpJr) September 27, 2023
They’ve set the game up so it’s always lose/lose in these blue states. If you don’t abide by their narrative they will target you. https://t.co/IZDefUGpHH
Judge Arthur Engoron implied the market value of the property in a Sept. 26 summary ruling that found President Trump’s business empire liable for fraudulently inflating property values in loan paperwork. He revoked the Trump Organization’s business licenses in the state and ordered it dissolved.
President Trump’s lawyers argued that the banks providing the loans didn’t care about the valuations produced by the company because they do their own. All the loans have or are being properly repaid with interest, they noted. The judge ruled, however, that under New York law the state can sue for inflated property values even if nobody was harmed by them.
Mar-a-Lago was overvalued by “at least 2,300%” because the Palm Beach County Assessor assigned it a market value of $18 million to $27.6 million between 2011–2021, while the Trump Organization valued it at $426,529,614–$612,110,496 on its Statements of Financial Condition (SFC) in those same years, the judge said.
There are problems with using either of the valuations.
The county’s website says that “the estimate of Total Market Value is for tax assessment purposes only” and “the Total Market Value estimate may be less than the actual market value of the property.”
Meanwhile, the SFCs include a disclaimer that the asset values are “determined by Mr. Trump in conjunction with his associates and, in some instances, outside professionals” and “the estimates presented herein are not necessarily indicative of the amount that could be realized upon the disposition of the assets or payment of the related liabilities.”
President Trump referred to the disclaimer as a “worthless clause,” saying it indicated to him that the documents were more an enumeration of his assets, rather than their actual market valuation.
The judge rejected that reasoning, arguing the disclaimer is itself “worthless” as a defense because it “does not use the words ‘worthless’ or ‘useless’ or ‘ignore’ or ‘disregard’ or any similar words.”
The actual market value of Mar-a-Lago is unclear.
President Trump’s lawyers presented a real estate expert, Lawrence Moens, “who they purport is ‘the most accomplished and knowledgeable ultra-high net worth real estate broker in Palm Beach, Florida,’” the judge said.
“His dominance of one of the country’s richest real estate markets is total,” a 2022 Real Deal profile of the secretive realtor said, noting that he closed perhaps $1 billion worth of deals in just the 18 months of the COVID-19 pandemic real estate mania.
Valuing Mar-a-Lago at $425 million–$612 million was “appropriate and indeed conservative,” Mr. Moens told the court. The property is currently worth $1.51 billion, he opined.
By Petr Svab
