US President Donald Trump disembarks from Air Force One. Photo / AP
In the nine years before he ran for president, Donald Trump's company spent more than US$400 million in cash on new properties - including 14 transactions paid for in full, without borrowing from banks.
It was a buying binge that defied real estate industry practices and Trump's own history as the self-described "King of Debt."
Trump's vast outlay of cash, tracked through public records and totalled publicly here for the first time, provides a new window into the President's private company, which discloses few details about its finances.
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.
Why did the "King of Debt," as he has called himself in interviews, turn away from that strategy, defying the real estate wisdom that it's unwise to risk so much of one's own money in a few projects?
And how did Trump - who had money tied up in real estate and buildings - raise enough liquid assets to go on this cash buying spree?
From the outside, it is difficult to assess how much cash the Trump Organisation has on hand.
Eric Trump, a son of the President who helps manage the company, told the Washington Post that none of the cash used to purchase the 14 properties came from outside investors or from selling off major Trump Organisation assets.
Instead, Eric Trump said, the firm's existing businesses - commercial buildings in New York, licensing deals for Trump-branded hotels and clothes - produced so much cash that the Trumps could tap that flow for spending money.
"He had incredible cash flow and built incredible wealth," Eric Trump said. "He didn't need to think about borrowing for every transaction. We invested in ourselves."
He added: "It's a very nice luxury to have."
The cash purchases began with a US$12.6 million estate in Scotland in 2006. 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 US$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 US$164 million in cash to keep them running.
Trump's lavish spending came at a time when his business was leaning largely on just one major financial institution for its new loans - Deutsche Bank, which provided US$295 million in financing for big projects in Miami and Washington.
Eric Trump said his father wasn't forced to turn to an all-cash strategy. Trump could have borrowed more if he wanted, he said. But he had soured on borrowing in general, Eric Trump said, after contending with unpaid debts in the early 1990s.
"Those lessons undoubtedly shaped his business approach and the conservative nature of how we conduct business today," Eric Trump said.
Real estate investors typically don't buy big properties with their money alone. They find partners to invest and banks to lend alongside them. That allows the investors to amplify their buying power, and it increases the odds of earning higher returns.
"For privately held real estate firms, basically they like to use as much debt as they can. The only brakes are put on by the lending institutions, who don't want to lend too much," said David Geltner, a professor of real estate finance at the Massachusetts Institute of Technology.
Industry experts said avoiding loans can alleviate risk for real estate companies and allow them to manoeuver more quickly.
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But they said that approach is typically undertaken by cash-rich investors that aren't focused on maximising the money they make off a property or by companies that aren't trying to minimise their tax bills, because interest payments on mortgages are often tax-deductible. Companies that have trouble obtaining loans would also turn to cash, they noted.
Particularly when pursuing major projects, private real estate firms usually borrow. "I still think at the end of the day, you want some debt," said Ed Walter, a Georgetown University real estate professor and former chief executive of Host Hotels, which owns more than 100 hotels under various brands.
Trump himself embraced that philosophy - extolling the virtues of borrowing big, even more enthusiastically than other real estate executives. Until, suddenly, he didn't.
To total up Trump's cash payments in real estate transactions, the Washington Post examined land records and corporate reports from six US states, Ireland and the United Kingdom. These records show purchase prices for Trump's properties, details about any mortgages and - in the United Kingdom and Ireland - the amount of cash Trump ploughed into his clubs after he bought them. The Post provided the figures it used to the Trump Organisation, which did not dispute them.
Documents tell the story - written in tiny type and in the lifeless prose of lawyers - of Trump's flashy career in real estate.
It was a career built on chutzpah, debt . . . and more debt.
All of us here today are united by the same timeless values. We believe that our liberty is a gift from our creator, and that no Government can ever take it away. We believe in the rule of law - and we support the men and women of law enforcement. We have pride in our history... pic.twitter.com/eONj1Y8oju
— Donald J. Trump (@realDonaldTrump) May 4, 2018
"He always used other people's money. That's for sure. Not cash," said Barbara Res, who was a top executive for Trump throughout the 1980s and continued to work for him for most of the 1990s. "He always got somebody to put up funds for him. To put up the money. And he'd put up the brilliance."
Debt helped make Trump in the first place, allowing the prince of an outer-borough apartment empire to play a king in Manhattan.
In 1988, when Trump bought New York's famed Plaza Hotel, he paid US$407.5 million. He got a US$425 million loan.
"If the world goes to hell in a handbasket, I won't lose a dollar," Trump bragged to a reporter in 1988. He said he had offloaded the risk by investing and borrowing against other people's money.
But then it was debt that nearly sank Trump, when a late-'80s recession undercut his risky investments in hotels, casinos and airplanes. Among the things he lost was the Plaza: The bank took it back and sold it for US$325 million in 1995. He never personally went bankrupt, but his real estate holdings dwindled.
Then debt helped him come back.
After several low years in the 1990s, Trump began to rebuild his real estate business with borrowed money. He got mortgages to buy an office building on Wall Street. Golf courses in Florida and New York. A US$700,000 home in Palm Beach, Florida.
George Ross, a senior counsel who advised Trump for 25 years, summed up the developer's attitude toward debt in one sentence.
"Borrow as much as you can for as long as you can," Ross wrote in his book Trump Strategies for Real Estate.
In the book, Ross explained that borrowing allowed Trump to seed his money into multiple projects at once, then fill out the rest with loans and partners' investments, protecting his bank account and getting significant tax write-offs on the interest he had to pay.
"When Trump invests in a real estate project, he typically puts up less of his own money than you might think," Ross wrote, explaining how Trump followed this rule. "Typically, his investors in the project will put up 85 per cent while Trump puts up 15 per cent."
Then in 2006, the same year Ross's book was published, Trump changed his approach.
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Trump began buying up land near Aberdeen, on Scotland's North Sea coast. Trump ultimately paid US$12.6 million for the property. He's spent at least US$50 million more to build a golf course there, which was wrapped up in land-use fights and didn't open until 2012.
"Even his closest senior advisers in NYC were surprised" that Trump paid cash, recounted Neil Hobday, a British developer who worked on the Aberdeen project with Trump.
Why did he do it?
Hobday believed it was a personal connection: Trump's mother was born in Scotland.
"He was, I believe, 'mystically' connected and hooked to this project. All my conversations with him were almost on an emotional rather than hard business level," Hobday wrote in an email to the Post.
But Trump soon began to buy other properties in cash, in places far from his mother's homeland.
In 2008 and 2009, Trump paid US$17.4 million in cash for two neighbouring Beverly Hills homes.
In 2009, Trump spent at least another US$6.7 million on two golf clubs, one outside New York City and another outside Philadelphia.
In Charlottesville, Virginia, he paid US$16.2 million for a winery, buying up the first plots in 2011. "I own it 100 percent, no mortgage, no debt. You can all check," Trump said of that winery during the 2016 campaign.
By 2011, Trump had spent at least US$46 million on all-cash purchases.
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— The Hill (@thehill) May 6, 2018
Public records reveal some details about the Trump Organisation's finances during this time period.
The company was taking in tens of millions from the sale of residential properties, including a home in Palm Beach for US$95 million in 2008. It made money off licensing deals: In 2015, Trump reported making at least US$9.1 million from those deals over 16 months. The firm also collected rent from its commercial buildings, producing what Forbes recently estimated was another US$175 million annually.
But that wasn't all free cash. Those businesses also came with costs - salaries, renovations, taxes, payments on existing mortgages - that pulled money out of the business. Those costs haven't been released.
In the same period, some of Trump's companies also experienced financial problems. His publicly traded casino and hotel company declared bankruptcy in 2009. And in 2008, Trump sued Deutsche Bank to challenge the size of his payments on a loan related to his tower in Chicago. Trump's logic in that case: The 2008 financial crisis had crushed the real estate business so completely that it should be considered like an act of God.
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— The New Yorker (@NewYorker) May 6, 2018
Eric Trump said that, in this time, the company had accumulated enough cash to have ready spending money, so it could bid on short notice.
When the Trumps felt an emotional connection to a property, Eric Trump said, they didn't want to wait for banks and outside partners to sign off. So they paid cash.
"We want to be nimble. If we see an unbelievable opportunity or something that interests us, we want to jump on it," he said.
"With lenders, every time you sneeze, you have to write a four-page report," he added.
Despite that distaste for bankers' paperwork, the Trump Organization still obtained loans in this period from Deutsche Bank. Starting in 2012, Trump borrowed US$125 million from Deutsche Bank to purchase the Doral golf club in Florida and another US$170 million from the same bank to renovate the Old Post Office into a hotel in Washington. The Trump Organisation declined to comment about why they turned to borrowing in these cases.
He spent US$65 million of his own on those two deals to cover the costs that Deutsche Bank did not.
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Then the spending got bigger.
The year before he launched his campaign for president, Trump made the two most expensive all-cash purchases that the Post found in its review. In 2014, he shelled out US$79.7 million for the huge golf resorts in Doonbeg, Ireland, and Turnberry, Scotland - both of which were losing money at the time.
The golf courses were his most recent cash deals and last acquisitions before becoming president.
The Trump Organisation pursued pricey renovations of both courses, during which time the properties have continued to suffer losses. Under Trump, the two courses are at least US$240 million in the hole so far, according to British and Irish corporate records.
Had Trump financed the property, the risks to the investment would be shared among lenders and other partners.
Geltner said it was unusual to see a company not bring in financial partners in either the purchase or construction of such large development projects.
Speaking about the Mueller probe, Rudy Giuliani tells Judge Jeanine: "Maybe they think Manafort's somebody they can flip faster."
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... hence implying that Manafort has incriminating evidence on Trump that would give him leverage to flip. pic.twitter.com/EENif8KXEz
Will this be Simon Dallow's swansong year as the 6pm newsreader?