The most valuable skyscraper in Donald Trump’s portfolio has been placed on a lender watchlist.
The mortgage on the Trump Organization’s 40 Wall Street in the Financial District was placed on the watchlist amid concerns of rising expenses and vacancies, Bloomberg reported. The mortgage, which is being serviced by Wells Fargo, has a balance of $126.5 million.
The vacancy rate at the 72-story tower neared 18 percent in the third quarter, according to a monthly loan filing. Since the origination of the $160 million mortgage in 2015, expenses at the building have risen 11 percent. The debt service coverage ratio has dropped from 2.13 to 0.92.
The firm claims to have leased 100,000 square feet at 40 Wall Street and has another 40,000 square feet of deals pending, which it called “unheard of in the current NYC environment.”
Co-working firm Jay Suites last year signed a 12-year lease for 50,000 square feet at the tower. Asking rent at the 1.3 million-square-foot property was said to be a bargain $40 per square foot.
Other tenants at the building include Country-Wide Insurance and Thornton Tomasetti.
The building previously faced financial pressure in 2021, when its value fell 29 percent to $130 million. The dive meant the family firm could pay nearly $1.7 million less on property taxes.
The lender isn’t the only one watching the happenings at 40 Wall Street. The property is among 200 instances of alleged fraud uncovered by a three-year probe by New York Attorney General Letitia James’ office. Officials alleged in a lawsuit filed in September the former president and the Trump Organization inflated property values to curry favorable loans and lower taxes.
The civil lawsuit claimed bank-ordered appraisals valued 40 Wall Street at $200 million as of Aug. 1, 2010, and $220 million as of Nov. 1, 2012. Trump’s firm had listed the building’s value at $524 million and increased it to $527 million in 2012 and to $530 million in 2013 — “more than twice the value calculated by the ‘professionals,’” according to the lawsuit.
— Holden Walter-Warner