Magical thinking fabulist Eric Trump values Mar-a-Lago at $1B - let's do some math
A family of liars
Donald Trump is a liar of scope and power. His son Eric has the same love of mendacity but none of his father’s world-class talent for shit-shoveling. However, lack of ability does not hold the dumbest Trump back. Despite a judge’s ruling that the Trump Organization is a fraudulent house of cards built on the sands of hyper-inflated valuations, Eric still claims that Mar-a-Lago is worth $1 billion.
To give credence to the incredible, Eric does what appraisers do. He looks to comparable homes. However, unlike reputable appraisers, Eric picks comps that are not comparable — and lies about them.
The facts and how to ignore them
Let us start with facts. Mar-a-Lago (MAL) is 62,500 sq ft and sits on a 17-acre property stretching from the Atlantic to the Intercostal. However, instead of selecting similar properties, Eric uses smaller homes on smaller lots for comparison. He uses these numbers to extrapolate a value for MAL. (Note: He also uses asking, not selling prices — which in most markets are a wish, not an expectation.)
This convoluted and meaningless comparison was not even Eric’s idea. Some Twitterer called KanekoTheGreat did his thinking for him. But the uncritical Eric was so impressed with the deception, that he eagerly regurgitated it.
Not that it makes a difference. No matter whose idea it was, we can dismiss it.
For starters, Eric is poor at arithmetic. In his argument, he says the homes he uses for comparison are “about 1/30th the size of Mar-a-Lago.” If that were the case, and we took the smallest of his examples, that would make MAL 150,000 ft.² – almost 2 1/2 times its actual size.
If Eric had used the correct math and taken the most favorable example (a 4,992 ft.² home on the market for $39 million) that would give MAL a value of $487 million — less than 50% of Eric’s number.
If we take another of his examples (an 11,492 ft.² house on the market for $39.9 million) that would give MAL a value of $218 million) — more than 75% less than the fantasy.
A true comp for Mar-a-Lago
If you compare apples to apples — as honest appraisers do — the number is even less than that. Last year, Florida saw its most expensive residential real estate transaction when Larry Ellison bought a home in Manalapan, just south of Palm Beach, for $173 million. The sale was of a home and property almost the same size as MAL — with the same water access. Specifically, the house is 62,200 ft.² and sits on a 16-acre property that also stretches from the Atlantic to the Intercostal.
We are now down to less than 20% of Eric’s absurd number.
It gets worse. To buy Mar-a-Lago, Donald Trump signed away its development rights. The property is therefore restricted to being a social club — in other words, a business. Based on revenues, estimated to be $25 million a year, that would give the property a valuation of $75 million - 7.5% of Eric's estimate.
Eric potentially adds millions to the Trump tax bill
Being reactive and not terribly bright, Eric has potentially put the Trump family on the hook for millions of additional property taxes. I would love to see the Palm Beach tax office use Eric's estimate to reassess MAL's taxable value. And adjust the property tax bill accordingly. Unfortunately, property assessments are usually decided by dispassionate algorithms — not the chest-thumping machismo of 6’ 5” little boys who think they are all grown up.
The national/international records
The most expensive property ever sold in the US is the 24,000 ft.² Central Park South NY apartment bought by Ken Griffin for $239 million.
Globally, the most expensive property currently listed for sale is a mansion in London's Regents Park that is on the market for $300 million.
Conclusion
Eric Trump is a silly person — and a bad liar.