Trump’s divisive presidency reshapes a key part of his private business

The following article by David A. Fahrenthold, Amy Brittain and Matea Gold was posted on the Washington Post website September 17, 2017:

As President Trump’s actions and rhetoric grow more polarizing, his business empire is losing lucrative event business. The Post’s David A. Fahrenthold looked at the trend of charities leaving Trump properties. (Jenny Starrs/The Washington Post)

For two years, a shelter for victims of domestic violence called Safe+Sound Somerset held its fundraiser golf tournament at Trump National Golf Club in Bedminster, N.J.

They loved it.

Then they quit it.

“Beautiful golf course. Beautiful facilities. We were treated well. But we couldn’t go back,” said Debbie Haroldsen, the charity’s acting executive director. President Trump’s campaign-trail comments about women and Mexicans had offended staff and clients. They found another course.

In Florida this year, the president’s politics attracted a new client for one of his businesses. Steven M. Alembik, a conservative activist, is planning a $600-per-seat gala at the Mar-a-Lago Club.

His logic: Trump helped Israel. So Alembik will help Trump in return.

“He’s got Israel’s back,” Alembik said. “We’ve got his back.’”

Trump’s divisive political career is reshaping a key — and previously apolitical — part of his business empire.

Trump-owned hotels and clubs have long made money by holding galas and other special events. Now, their clientele is changing. Trump’s properties are attracting new customers who want something from him or his government.

But they’re losing the kind of customers the business was originally built on: nonpolitical groups who just wanted to rent a room.

This summer, 19 charities canceled upcoming events at Mar-a-Lago — a major blow to that club’s business — after the president said there were “fine people” among white supremacists, neo-Nazis and members of the alt-right protesting to preserve a Confederate statue in Charlottesville. Dozens of other clients have left since Trump entered the 2016 presidential race.

On Saturday, the latest cancellation: A triathlon for charity at Trump’s Charlotte golf course, called “Tri at the Trump,” was abruptly scrapped. Sign-ups were down this year, the organizer said, due to concerns over the name.

For the Trump Organization, a potentially troubling trend is emerging.

Before this year, many longtime Trump clients said they would return to use his clubs again — believing that quitting a Trump club would be a political act. Now, as Trump’s presidency has grown more polarizing, some customers say they see it as a political act to stay.

“We are not a political organization,” said Mike Levin, whose charity Harlem Lacrossethis year moved its golf tournament away from a Trump course in New York state, after going there for two prior years. “Given the current political environment, we opted to reschedule for a different course.”

In all, Trump owns 12 golf courses in the United States — 11 on the East Coast, and one outside Los Angeles. He owns at least a partial stake in four hotels, in the District, Chicago, Las Vegas and New York’s SoHo. And he owns Mar-a-Lago and a winery resort outside Charlottesville.

To assess the state of Trump’s hospitality business, The Washington Post reviewed public records, data released by the Trump Organization and social-media postings from Trump properties. The Post identified a sample of more than 200 groups that had rented out meeting rooms or golf courses at a Trump property since 2014.

Of those groups, 85 are no longer Trump customers. Many said they left for nonpolitical reasons. But 30 told The Post that they had left because of Trump’s political career.

The Post provided its findings to the Trump Organization, which declined to provide a response or answer questions. A White House spokeswoman declined to comment, referring questions to the Trump Organization.

The Post’s review could not determine if the Trump Organization’s special-event business is growing or shrinking overall.

But it did show, clearly, that one part of that business is thriving. The business of political events.

For instance, in the 2014 election cycle, before Trump jumped into the presidential race, nine federal Republican candidates and committees reported patronizing Trump-owned properties.

Altogether, these groups spent $32,499 over two years, less than Trump’s clubs could take in from a single run-of-the-mill golf tournament.

This year, the figures are different.

At least 27 federal political committees — including Trump’s reelection campaign — have flocked to his properties. They’ve spent $363,701 in just seven months, according to campaign-finance reports. In addition, the Republican Governors Association paid more than $408,000 to hold an event this spring at the Trump National Doral golf resort, according to tax filings, a gathering the group said was booked back in February 2015.

At Trump’s D.C. hotel, there have also been a slew of events involving groups that have come to Washington to influence policy decisions.

Just last week, the hotel hosted the prime minister of Malaysia, who is the subject of a Justice Department corruption probe, as well as the Louisiana Association of Business and Industry, which wants more offshore drilling. The hotel was also scheduled to host an association of candy-makers, who want federal help in a long-running feud with the sugar industry.

In July, a trade group representing e-cigarette makers and vape shop owners brought about 150 people to the hotel. They paid $285 per guest room. They also paid to rent a ballroom, and reserve the hotel’s Lincoln Library, though the vapers wouldn’t say how much they cost.

Ten days after the group checked out, it scored a victory.

An Obama-era regulation requiring stricter government oversight of e-cigarette products was put on hold by the Food and Drug Administration.

Tony Abboud, the executive director of the Vapor Technology Association, said in a recent interview that the FDA decision was based on the merits and unrelated to the group’s choice of venue. He said the Trump hotel was chosen as a matter of convenience.

“We put this together very quickly,” he said.

When asked whether the Trump hotel event had influenced the FDA’s decision, an agency spokesman said that the announcement was the “culmination of months-long internal discussions” about how to reduce tobacco-related deaths.

Rentals from groups such as these helped Trump’s D.C. hotel surpass its own revenue expectations.

Through the first four months of the year, the hotel turned a profit of $1.97 million, according to documents reported by The Post last month. Before the election, the company had projected it would lose $2.1 million in the same period, the documents show. The revenue from food and beverage sales — which includes special events — was part of that surprising performance. It came in 37 percent above expectations.

Trump’s politics was a draw for Alembik, the conservative Israel backer who decided recently to hold an event at Mar-a-Lago, the president’s oceanfront club in Palm Beach.

Alembik said he will charge $600 per ticket. He expects 700 guests. That’s $420,000. In theory, Alembik said, any leftover proceeds will go to an Israeli charity called The Truth About Israel.

But, Alembik said, Trump’s club will probably keep most of the money. He said he’d recently seen an estimate of the costs. He declined to say what the number was, but said: “My God, they’re expensive. Holy crap.”

“With what Mar-a-Lago charges,” he said, “I don’t think there’s going to be much left over.” Alembik was fine with the idea that he was putting money into the president’s pocket: “Yeah, and the other ones are taking money out of his pocket,” he said, meaning the charities that canceled after Charlottesville.

Alembik’s event is unusual, in that he is explicit about using a ballroom rental as part of a political message to the president.

More broadly, however, many Trump clubs seem to be losing the customers that had been commonplace before.

That trend began in California in 2015, just after Trump said in his campaign announcement speech that Mexico was sending “rapists” to the United States. The L.A. Unified School District canceled a golf tournament. So did ESPN, the PGA, the L.A. Galaxy soccer team and the Union Rescue Mission.

The Post counted 11 special events at Trump’s California course in 2014. Now, 10 of those clients are gone.

Those California departures made news.

But at other clubs, clients were also quietly deciding to leave.

“A lot of the children that are in our program are immigrant children, [and] we didn’t want them to feel offended” by Trump’s comments about Mexicans, said Debra Green, of a youth-sports charity called Jeremy’s Heroes. For four years, her charity, named for a passenger who fought back against hijackers on Sept. 11, 2001, had used Trump’s golf course in Colts Neck, N.J., for its charity fundraiser.

In 2016, the group didn’t return.

That meant about $50,000 in lost business for Trump’s club.

“We would not have changed the venue, but for that happening,” Green said. “The facilities, the service there, were all excellent.”

At Trump’s course in the Bronx, the drop is spelled out in figures provided to New York City, which owns the land under the course. The city data shows that the revenue from “outings” — events where the course is rented out by outside groups — declined 30 percent from 2015 to 2016 and is headed down again this year.

Other courses appear to be experiencing declines. In Westchester County, N.Y., 14 of the 21 clients that The Post identified in 2014 are now gone.

In Colts Neck, N.J., 11 of 17 are gone. The losses included the Golf Classic of the Sisters of Mercy, a tournament that benefits retired nuns. “The sisters cannot participate in a political campaign or support a specific candidate,” a spokeswoman wrote.

Most of those departing cited nonpolitical reasons for their decisions — such as the end of a contract, the price of the rental or a need for more event space.

For the Trump Organization, some clubs are doing better than others. At Trump’s course outside Charlotte — one of just three courses located in counties Trump won in 2016 — a number of new events have sprung up since 2014.

But even there, the Trump name can be a drag for the club’s customers.

Like the organizer of “Tri at the Trump.”

“A lot of people wouldn’t participate because of that,” said Chuck McAllister, who runs the triathlon, referring to the Trump name. The triathlon had used that name for three prior years. This year was different. Participant numbers were far below the high of 325-plus, set before Trump won the GOP nomination.

McAllister initially tried Sept. 11 to resolve the controversy, first reported by the Charlotte Observer, by changing the race’s name to Tri for Good.

That wasn’t enough.

“I had some people sign up. And I had some people want out,” he told The Washington Post late in the week. “Probably a pretty even split.”

Finally, on Saturday, he canceled the event. The situation “became way [too] politicized,” McAllister wrote in an email message.

At Trump Doral, a golf club and resort outside Miami, The Post identified 18 business conferences or golf tournaments scheduled to be held at the property from mid-September through next May.

Many are sponsored by industry groups such as the Food Marketing Institute, which is hosting a conference for 1,000 food retailers and suppliers there in January. The group signed a contract to book the Doral back in April 2015, according to a spokeswoman.

A major defense contractor, L3 Technologies, just announced that it would hold its annual management meeting at the resort. A spokeswoman said the company chose Doral for a variety of logistical reasons unrelated to politics.

Last Tuesday, at Trump’s club in the New Jersey suburbs of Philadelphia, there was a tournament that epitomized the old business model for his events business. A charitytied to the Philadelphia Flyers hockey team held a celebrity golf tournament, with players teeing off and then gathering for fancy food.