Donald J. Trump’s meeting this week with Shinzo Abe was more than a session between president-elect of the United States and prime minister of Japan. It was a meeting of a global family business and the leader of one of the world’s top economies.
Trump’s business – The Trump Organization – has a financial history with Japanese investors and banks. And the woman he’s said would help run it to avoid conflicts while he’s president – his daughter Ivanka – sat in on the high-level meeting. Her participation was disclosed by the Japanese, not Trump.
“I cannot think of any incoming president with the business entanglements we see with Mr. Trump,” said Douglas Brook, who worked on the outgoing transition teams of Presidents George H.W. Bush and George W. Bush. “The Trump Organization is a worldwide set of operating companies ... the potential for the appearance of conflict is pretty high, but we’re in uncharted waters here about how to deal with it.”
The meeting with Abe, Trump’s first face-to-face meeting with a foreign leader since he was elected, underscored the potential conflicts.
One major intersection with Japanese investors came with the Trump International Hotel & Tower Waikiki Beach Walk in Hawaii. Wealthy Japanese buyers bought four out of every 10 suites and residences when they were put on sale a decade ago.
“Asian buyers want the best and they love Donald Trump. Our partnership with Seven Signatures to create a Tokyo sales center paid off on this project,” Peter Dupuis, CEO of S&P Destination Properties, boasted in a statement at the time.
Dupuis’ statement on Nov. 10, 2006, announcing a one-day sale attracted more than $700 million from buyers who purchased all 464 hotel suites and residences offered for sale. It was a first-day sellout and the news release declared it “the biggest one-day sale in real estate history in the world.”
Trump promised to expand his business empire to Japan next.
“The reason I came to Tokyo is the fact that I want to thank all of the buyers,” he said on a visit to Japan in October 2006. “We have just sold (a) tremendous number of units. And I made a pledge at the very beginning to some of the buyers, if we sell quickly a certain number of units, I would come to Japan.”
The building remains a draw to Japanese buyers.
“We do see a healthy resale market, and it is comprised of Japanese nationals investing in the building,” said Isaiah Yuuki Block, principal broker in the Hawaii office of Seven Signatures. “It’s still gold-bar real estate in Waikiki for a market dominated by the Japanese.”
As with many other properties around the world, reported earlier this year by McClatchy, Trump didn’t actually own the property. The Hawaii hotel property was owned by Irongate Azrep BW LLC, which assumed the risks. It paid Trump to lease his name for the five-star hotel and residences.
Trump got a percentage from each unit sold, and has a property management company – Trump Hotel Collections – that actually runs the hotel operations.
The Trump Organization also has banking ties to Japan, according to the biography Trump Revealed, published in August by Washington Post reporters Michael Kranish and Marc Fisher. The book details how many big U.S. banks in the 1980s such as Citibank and then-Chase Manhattan bank reduced their exposure to loans they’d made to Trump by selling a portion of the exposure to Japanese banks.
Later, the authors said, when Trump sought investment for the Trump Tower project in New York, he struggled because Japanese bankers turned a wary eye to his large debts.
The Abe meeting was complicated by the attendance of his daughter. Trump is president-elect, not yet holding office, and can have whoever he likes at these meetings, said Brook.
“In this case, it appears unusual because the invitee was his daughter,” he said.
Ivanka Trump’s presence at the meeting became public through photos released by the Japanese government.
One of the photos also showed her husband, Trump’s son-in-law Jared Kushner, meeting the prime minister. Members of the press were barred from the meeting between Trump and Abe, and were not provided a summary of what was discussed.
Open government and ethics watchdogs called on Trump this week to place his sprawling business assets and investments into a blind trust, warning he risks conflicts of “unprecedented magnitude.”
They pointed to Trump’s promise to avoid conflicts by transferring control of his businesses to Ivanka and her brothers, calling that far short of a hands-off arrangement often called a blind trust.
“That’s more like an all-seeing trust!” said Robert Weissman, president of Public Citizen. He said the arrangement would “do nothing to eliminate the staggering conflicts of interest” and that “making matters still worse is that it is apparent that his children will be heavily involved in administration policy making.”
Ivanka Trump has her own financial interests as well. She has her own line of clothing and of high-end jewelry she sells through Ivanka Trump Fine Jewelry.
After Ivanka appeared with her father on 60 Minutes last Sunday, her company Ivanka Trump Fine Jewelry sent around an email to journalists noting she was sporting her favorite bracelet, which retails at $10,800.
The immediate outcry over “brand placement” led to an apology of sorts from her company. In a statement, the company blamed it on “a well-intentioned marketing employee at one of our companies who was following customary protocol, and who, like many of us, is still making adjustments post-election.”
Lesley Clark contributed