How the Hell Did the Trump Organization Access So Much Cash?

Here’s an interesting question: Do Donald Trump and his children—Eric, Ivanka, and Donald Trump Jr., specifically—strike you as astute and savvy business executives running a lucrative global real estate empire with hundreds of millions of dollars in cash at their disposal?

A new report in The Washington Post reveals that in the nine years before Trump launched his presidential campaign, the Trump Organization spent more than $400 million in cash on real estate deals. This represents a striking departure for a business that previously had relied heavily on debt to do business. The Post investigation, compiled from public records, raises as many key questions as it answers regarding the source of funds used by the Trump family over nearly a decade.

The newspaper describes 14 transactions that began in 2006 with the cash purchase of a $12.6 million estate in Scotland as a “buying binge that defied real estate industry practices and Trump’s own history as the self-described ‘King of Debt.’”

“It shows that Trump had access to far more cash than previously known, despite his string of commercial bankruptcies and the Great Recession’s hammering of the real estate industry,” the Post stated.

The newspaper added:

In the next two years, he snapped up two homes in Beverly Hills. Then five golf clubs along the East Coast. And a winery in Virginia.

The biggest cash binge came last, in the year before Trump announced his run for president. In 2014, he paid a combined $79.7 million for large golf courses in Scotland and Ireland. Since then, those clubs have lost money while Trump renovated them, requiring him to pump in $164 million in cash to keep them running.

Asked about all of this, Eric Trump said none of the cash came from outside investors or selling off Trump Organization assets. “He had incredible cash flow and built incredible wealth,” Eric said about his dad’s apparent business acumen.

But that’s not how Trump historically has done business. His was “a career built on chutzpah, debt . . . and more debt,” the Post noted.

The report doesn’t get to the bottom of where all this cash came from, but it does bring past comments by the Trump children back into focus, at least speculatively. In 2008, Donald Trump Jr. stated that, “Russians make up a pretty disproportionate cross section of a lot of our assets.”

In 2014, golf writer James Dodson was hanging out on the golf course with Eric Trump. Dodson asked him where the Trumps got all their money, as banks weren’t loaning at the time. According to Dodson, Eric said, “Well, we don’t rely on American banks. We have all the funding we need out of Russia.” He added: “Oh, yeah. We’ve got some guys that really, really love golf, and they’re really invested in our programs.”

Eric’s comments came at about the same time the Trump Organization embarked on its “biggest cash binge,” as described by the Post.

The newspaper noted:

The company was taking in tens of millions from the sale of residential properties, including a home in Palm Beach for $95 million in 2008. It made money off licensing deals: In 2015, Trump reported making at least $9.1 million from those deals over 16 months. The firm also collected rent from its commercial buildings, producing what Forbes recently estimated was $175 million annually.

But none of the costs associated with operating those assets has been made public.

“You’re going to have some operational losses,” Eric told the newspaper, “and then you get into the black, and you make great money.”