Trump International Hotel & Tower Toronto Condos (Talon International) - Real Estate

IMHO the focus of this article (the single mom with three kids) made a poor investing decision and didn't look into things sufficiently before committing. It's got nothing to do with the Trump Towers - it's just poor decision making on her part.

Rob P - I would love to see photos when you have them. I used to work in Scotia Plaza and watched the Tower go up for several years through my office window. Now I watch the progress at a distance from my new location in TD Tower. Have always wondered what the suites must be like...
 
Same story as before. Sloppy reporting with many facts both inaccurate and misconstrued in order to make it look like something more than it is. Yes, there are handful of buyers whom are trying to get out of their deals (a very small minority). This is no different than ANY other project or development. Some people overextend themselves, or their financial position changes over time. Yet, this particular writer is trying to make it look this is out of the ordinary. Most folks who have purchased in our property have consulted their lawyers and/or financial advisors. Anyhow, it's not worth giving it more weight. It's the Star, it's what they do.

FYI, Alex Shnaider is a Canadian citizen whom immigrated to Canada with his family when he was a young boy.
 
I would want to back out too if I'd bought considering what a piece of crap the building has turned out to be. Not only did the height reduction and design change make the building way less attractive, but even the updated renderings oversold the building big time. It has turned out to be an utter eyesore, and with such prominence it's a blight on the skyline. Talon deserves all the criticism it gets for failing so spectacularly on the execution of this development. And even though it seems like what they did is perfectly legal, it *looks* sleazy to give preferential treatment to your employees. They should have compensated this person in some other manner.
 
everyone got greedy here and some will get burned badly.

it's too bad the R/E industry doesn't have to follow conflict of interest rules like the many that work in the financial district, where this condo is located, do.
 
Rob P said:
If you’re looking to live large in downtown Toronto, there aren’t many residences that can truly compete with Trump Tower‘s luxury lifestyle.

We aren’t kidding around on this one. The Trump family have built up an incredible reputation for quality and luxury and it’s awesome to see their residential and hotel condominium take shape at Bay and Adelaide.

There was plenty of fanfare when Donald Trump’s daughter Ivanka paid a visit to the Tower in February, so we’re guessing that the fanfare will be multiplied by at least five when the Trump clan touch down in Toronto on Monday.

Donald, his wife Melania and his children, Ivanka, Eric and Donald Jr. are attending the Trump Tower grand opening and will be wining and dining with a slew of high power dignitaries throughout the day. It’s going to be a media frenzy (understatement, perhaps?) so if you’re having trouble getting along Bay Street on Monday, you know why.

Maybe you’ll even catch a glimpse of the Trumps! But of course, the only way to guarantee that would be to book a room in the hotel for Monday… Just a suggestion.

We’ll be buzzing more on this one as it develops (expect pics!) so check back for the Donald Trump scoop sooner, rather than later.


from http://blog.buzzbuzzhome.com/2012/04/trump-tower.html
Click to expand...

Rob P: Are you the same individual who posted this?

If so, and you believe what you have said about Trump's cache; why are you selling at 7 year ago price?

Perhaps you will understand some skepticism on the part of some of us at what appears to be an attempt to build up a project in which you have a clear interest in building up. I am not questioning your motives, simply stating they appear driven on the surface at least by potential self interest.

If you are not the same poster/owner of the property, I apologize for bringing up any confusion.

Studio hotel unit available on assignment.
610sq/ft +/-
15th floor
2 double beds
Deluxe suite

This is an income bearing property.
Well below builders pricing. Identical unit to this sells for $1,025,000

visit http://www.trumptoronto.ca and http://www.trumptorontohotel.com for all info on the building and ammenities.

Also save the HST. This is over $80000 in savings alone
Deposit to take this assignment is approx $132000. Take advantage
Also no more deposits required on closing.

I purchased this unit 7 years ago at the intro prices. This price is plus the assignment fee trump asks which is 5%.

I am not making anything on the deal.
 
Last edited:
Donald Trump’s luxury hotel launch lacks luster for some buyers

By Susan Pigg Business Reporter
The Donald flew into Toronto Monday to officially open the new Trump International Hotel, taking the spotlight — at least briefly — off negotiations going on behind the scenes with investors trying to get out of condo deals.
Well over a dozen investors, some of whom bought more than one of the unique hotel/condo units when they first went on the market back in 2006, are refusing to pay final closing costs and assume ownership of units they say no longer make financial sense.
“I think some people will walk, some people will (eventually) close and some of them will inevitably end up in litigation,” says Toronto lawyer Bob Aaron who is representing “a handful” of buyers, including a U.K. couple who’ve refused to make final payments on a $830,588 unit.
A group of 10 Korean investors is also reportedly looking to get out of deals on multimillion-dollar units, concerned about maintenance fees that have now hit close to $3,000 a month, on top of other add-on costs like cleaning and “booking fees.”
But any investor revolt — if he even knows about any— didn’t seem to be ruffling a hair on Trump’s carefully coiffed head Monday. He waved and yelled hello to the crowd poised with cellphone cameras outside the elegant 60-storey hotel on Adelaide St. where Mayor Rob Ford, his brother Doug and dozens of media gathered for the official ribbon cutting in a 10th-floor conference room.
The Star was denied entry to the press event which was “invitation only,” according to one Trump executive, noting that The Star wasn’t on the list and that it was “a full room.”
Alex Shnaider, the Russian steel magnate and chairman of Talon International Development Inc. which built the five-star project, would only say later that he was “very happy” with the event to which Trump brought his daughter Ivanka, as well as sons Eric and Donald.
While the hotel has actually been open for weeks now, work on the condo floors continues and seemed to tie up elevators yesterday, creating long lineups to get to and from the ribbon cutting.
But behind the scenes the real work is continuing, with lawyers like Aaron.
“A lot of people went in blinded by the Trump name and Toronto’s condo boom. They put up a lot of money,” says Aaron.
“These (purchase) documents were very tightly written and they are one-sided,” to remove most of the financial risk of the project from Talon, he alleged.
“There’s not much I can do,” for investors.
One purchaser estimates his monthly costs, including mortgage fees and property taxes on a less than 600 square foot hotel/condo unit for which he paid $860,000, would now run about $8,000 a month.
He’s part of a group of Korean investors who refused to pay final closing costs due two months ago and hope to get back deposits worth almost $200,000.
“If I had closed then, I would have lost almost $10,000 already,” because of monthly fees, including $2,400 in commercial property taxes, says the investor who spoke on condition his name not be used. “I’m not going to let that down payment go without a fight.”
One U.S. buyer has already won the right from Ontario’s court of appeal to renege on his $709,000 hotel/condo suite and get back his $212,700, citing two-year delays in the project.
While that could have been grounds for other investors, most of those who’ve contacted Aaron agreed in writing to Talon’s requests for extensions because of construction delays — eight months because of weather alone.
Lawyers have been in discussions for about six weeks now, but investors may be in for a long and, ultimately, fruitless fight, Aaron warned.
Unless Talon agrees to let some off the hook or reduce the cost of some units, most owners are likely in breach of contracts and could be responsible for any damages accumulated by their delays in finalizing deals, he said.
 
I'd like to see the break down on those monthly expenses. $8,000/mo for 600 sqft?

Even if you include the mortgage payments, owners are getting milked...
 
Johnzz said:
I'd like to see the break down on those monthly expenses. $8,000/mo for 600 sqft?

Even if you include the mortgage payments, owners are getting milked...
Click to expand...

Johnzz,
I have no actual knowledge but I am guessing the major part is "phantom rent" and hotel fees:

Please appreciate this is pure speculation with no documentation, just guesses. With that caveat:

On $860K asking price less 25% leaves a mortgage of $645K. Assuming the builder gets a 3.5% mortgage...(and this may be low), interest alone would be $1881/month.
Condo fees at condo hotels as there are so many more amenities and staff I am guessing would be around $1/sq.ft. so another $600. Taxes (approximated) at $2.80 x 600 sq.ft./12 months is $1400/month. so we are getting close to $4000/month. Add insurance on the unit possibly?

Heat/hydro etc even with heavy usage I would think would not be more than $200.

Management fees to the hotel...I think that is the big issue. Likely there is a split of 60-40 between owner and hotel or maybe it is more favourable to one or the other party. Let's just use this as a number.

Also, assume there is not 100% occupancy. If we guess 80% occupancy; a room rate of $400/night on average x 30 nights x80% occupancy x 40% fee to the hotel... would be another $3840 payable to the hotel: Hence I am guessing this is how they came up with the $8000/month.

Note; using the same numbers the rent would be $5760 that an investor would receive. Hence a negative cash flow of over $2000/month and this does not count the initial investment down payment.

Maybe someone could post more realistic numbers if they have actual knowledge of a contract.
 
interested said:
Johnzz,
I have no actual knowledge but I am guessing the major part is "phantom rent" and hotel fees:

Please appreciate this is pure speculation with no documentation, just guesses. With that caveat:

On $860K asking price less 25% leaves a mortgage of $645K. Assuming the builder gets a 3.5% mortgage...(and this may be low), interest alone would be $1881/month.
Condo fees at condo hotels as there are so many more amenities and staff I am guessing would be around $1/sq.ft. so another $600. Taxes (approximated) at $2.80 x 600 sq.ft./12 months is $1400/month. so we are getting close to $4000/month. Add insurance on the unit possibly?

Heat/hydro etc even with heavy usage I would think would not be more than $200.

Management fees to the hotel...I think that is the big issue. Likely there is a split of 60-40 between owner and hotel or maybe it is more favourable to one or the other party. Let's just use this as a number.

Also, assume there is not 100% occupancy. If we guess 80% occupancy; a room rate of $400/night on average x 30 nights x80% occupancy x 40% fee to the hotel... would be another $3840 payable to the hotel: Hence I am guessing this is how they came up with the $8000/month.

Note; using the same numbers the rent would be $5760 that an investor would receive. Hence a negative cash flow of over $2000/month and this does not count the initial investment down payment.

Maybe someone could post more realistic numbers if they have actual knowledge of a contract.
Click to expand...


$2400-2600 maintanance fee
$1600-1800 interest on loan
3.1% property tax so roughly $1800/month
$65 cleaning service per night rented
$68 of nightly rental to booking fees

rooms rent $400-$500 per night

If they rent at 80% there would be positive cash flow.

$2650 maint
$1800 tax
$1600 interest
$6050/month fixed cost

rental avg
$450/night
450-133=317

317*30=9510 @ 100% occupancy

basically needs to rent 64% in order to break even
 
interested said:
^^^
thank you RobP

Occupancy was 68.3% in 2010 for all hotel rooms ranking TO 10th according to an archived article in the TO Star.

If this is still the case...will the 5 star properties have higher or lower than average occupancy?

http://www.thestar.com/news/article/928897--toronto-posts-record-year-in-tourism
Click to expand...

There is no magic ball and that is the problem. If average for 5 star is higher than the average I don't think so many people would be so quick to be getting out of the deals or trying too do so.

Ritz has been opened for less than 1 year and is the only other 5 star that can give some occupancy rate averages but I cannot find reports of the average. It is a new concept for Toronto so unproven.

Trump is in a great location so perhaps the bay street crowd with deeper pockets will keep the average higher but of course at this point it's all speculation.


There will always be negativity with projects involving Trump because many just don't like him but the fact is that the trump Toronto's ammenities and location are 5 star.
 
Rob P said:
$2400-2600 maintanance fee
$1600-1800 interest on loan
3.1% property tax so roughly $1800/month
$65 cleaning service per night rented
$68 of nightly rental to booking fees

rooms rent $400-$500 per night

If they rent at 80% there would be positive cash flow.

$2650 maint
$1800 tax
$1600 interest
$6050/month fixed cost

rental avg
$450/night
450-133=317

317*30=9510 @ 100% occupancy

basically needs to rent 64% in order to break even
Click to expand...


those are crazy maintenance fees - $2,600/m ! ! ! that comes out to about $4.40 psf/m ...
was that originally disclosed in the purchase and sale agreement?

i understand the 5 star service/staffing can add up quickly.

frankly, i don't see how condo hotels can be financially viable to buyers ...
they are money makers for the developer b/c the developer gets to pass off the risks and costs to others, and still get continous revenue for maintaining the hotel.

also, the quoted costs for interest is low. it may be that with the builder currently, but not when the individual buyer tries to get financing. AFAIK, this is a commercial property, not residential, where rates are higher.
commercial lending rates are currently around 5-6% for 5-year fixed 20 year amortization.
banks tend to stick with 20, maybe 25 year max for amortization for commercial properties.

so for $645K mortgage @ 5% 5/20 year amortization = $4,238/m;
so for $645K mortgage @ 5% 5/25 year amortization = $3,751/m
 
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