Today in Trumpika: Tall Trouble in Chicago

A few days after Donald Trump said he has “a lot of cash” and wouldn’t have a problem financing a development in Scotland, the Donald filed a lawsuit against the lenders of his unfinished Chicago skyscraper project. Trump wants more time to repay the $640 million construction loan on the 92-story Trump International Hotel and Tower, according to the Wall Street Journal. Due to the “unprecedented financial crisis,” Trump wants to trigger a clause in the deal normally reserved for “acts of war and natural disasters,” the article says. Sales in the partially completed tower, which contains 339 hotel rooms and 486 condos, will be the second tallest in America (behind Chi-Town’s own Sears Tower), “Have come in below original estimates and the project’s current projected revenue remains short by nearly $100 million,” reports the WSJ. The suit plunges the project into legal turmoil, as well as highlighting the credit clog’s pervasive effects on the real estate industry. In terms of the loan, the group of lenders has been led by Deutsche bank AG and included a unit of Merrill Lynch & Co., Union Labor Life Insurance Co., iStar Financial Inc., a publicly traded real-estate investment trust, and Highland Funds, a unit of Highland Capital Management LP-the sheer number of institutional participants comprising the lending group might have complicated matters in terms of agreeing upon an extension. The hotel, on the lower floors, opened earlier this year. But sales of both the hotel rooms and the condominiums have come in below original estimates and the project’s current projected revenue remains short by nearly $100 million needed to pay off the senior lenders. The lawsuit was filed in New York State supreme court in Queens.

Via WSJ