At Donald Trump’s civil trial, appraiser recalls Eric Trump’s ‘lofty’ views on property value
Eric Trump arrives at New York Supreme Court, Monday, Oct. 2, 2023, in New York. Former President Donald Trump is making a rare, voluntary trip to court in New York for the start of a civil trial in a lawsuit that already has resulted in a judge ruling that he committed fraud in his business dealings.
Former President Donald Trump comments to the media during a break of his civil business fraud trial at New York Supreme Court, Wednesday, Oct. 18, 2023, in New York.
Former President Donald Trump comments to the media during a break of his civil business fraud trial at New York Supreme Court, Wednesday, Oct. 18, 2023, in New York.
Former President Donald Trump sits in the courtroom with his legal team before the continuation of his civil business fraud trial at New York Supreme Court, Tuesday, Oct. 17, 2023, in New York.
New York Attorney General Letitia James sits in the courtroom for the continuation of the civil business fraud trial against the Trump Organization at New York Supreme Court, Tuesday, Oct. 3, 2023, in New York. Former President Donald Trump is in a New York court for the second day of his civil business fraud trial. A day after fiery opening statements, lawyers in the case are moving Tuesday to the plodding task of going through years' worth of Trump's financial documents.
Former President Donald Trump sits in the courtroom with his legal team before the continuation of his civil business fraud trial at New York Supreme Court, Tuesday, Oct. 17, 2023, in New York.
NEW YORK (AP) 鈥� The spotlight at former President Donald Trump鈥檚 civil fraud trial turned Thursday to his son Eric, with testimony and documents suggesting the scion envisioned a 鈥渓ofty鈥� value for a suburban golf course and was actively involved in appraisals he has said he doesn鈥檛 remember.
The trial stems from New York Attorney General Letitia James鈥� claims that Donald Trump, his company and executives, including Eric Trump, fraudulently inflated asset values on financial statements given to lenders, insurers and others. The defendants deny the allegations, and the 2024 Republican presidential front-runner says the values actually were underestimated.
About a decade ago, Trump鈥檚 companies sought appraisals of two of their properties in New York鈥檚 suburban Westchester County 鈥� the Trump National Golf Club and an estate known as Seven Springs, according to documents and testimony Thursday.
At the time, the companies were considering what are known as conservation easements on the properties, according to David McArdle, an appraiser with the commercial real estate firm Cushman & Wakefield. A conservation easement is essentially an agreement to forgo development in exchange for a tax break.
McArdle said he was asked in 2013 to figure out what the golf course would be worth if 71 high-end townhomes were built there, and he got substantial input from Eric Trump, who鈥檚 an executive vice president at the Trump Organization.
鈥淥f course Eric Trump has lofty ideas on value,鈥� assuming the townhouses would easily sell for $1,000 per square foot, McArdle wrote in an email to a fellow appraiser at the time.
Eric Trump subsequently sent McArdle suggestions of properties to use for comparison, while arguing that none had 鈥渃lose to the amount, quality or kind of amenities鈥� of the Trump course in Briarcliff Manor, New York.
As McArdle settled on a value around $45 million, he and lawyers for the Trump company strategized in email about how to present it to their client.
McArdle said Thursday that Eric Trump may have had a 鈥渕ore lofty value鈥� in mind, but a higher number wouldn鈥檛 have been credible. The email discussion was a leadup 鈥渢o finally tell Eric he should accept this value from the professionals,鈥� McArdle testified.
McArdle then got a message from Eric Trump, saying that he鈥檇 spoke to one of the lawyers and telling McArdle to hold off sending the appraisal until further notice.
Trump鈥檚 financial statements went on to list the golf course at values sometimes topping $100 million, according to James鈥� lawsuit. The villas weren鈥檛 built.
Donald Trump floated various plans over the years for Seven Springs, a historic mansion and 213-acre property that spans three Westchester County towns. After his development proposals met opposition, he pursued an easement.
McArdle was hired in 2014, through a lawyer for Trump鈥檚 companies, to evaluate Seven Springs鈥� value. The appraiser said the exercise assumed the estate could be divided into about two dozen building lots for luxury homes.
Once again, McArdle said, Eric Trump touted the property鈥檚 attributes to him and suggested a supposedly comparable spread 鈥� a Connecticut development where lots sold for as much as $3 million apiece.
鈥淗e had a very high opinion of his property,鈥� said McArdle, who said he eventually advised in a phone call that Seven Springs was worth up to $50 million. Eric Trump was included in and responded to emails arranging for McArdle to present his view.
A few months later, Donald Trump鈥檚 financial statements valued Seven Springs at over $160 million, according to James鈥� lawsuit.
When asked about McArdle in pretrial testimony this year, Eric Trump said he only 鈥渧aguely鈥� recognized the man鈥檚 name and didn鈥檛 recall much, if anything, about the appraisals of Seven Springs or the golf course.
鈥淚 pour concrete. I operate properties,鈥� Eric Trump said. 鈥淚 don鈥檛 focus on appraisals between a law firm and Cushman.鈥�
Defense lawyer Lazaro Fields, in questioning McArdle, sought to establish that it鈥檚 not uncommon for owners to talk up their properties鈥� value to appraisers and for their opinions to differ.
鈥淎bsolutely,鈥� McArdle said, 鈥渂ut ultimately, we鈥檙e the ones calling the value.鈥�
Both Eric and Donald Trump have attended some of the trial but weren鈥檛 there Thursday, when the court also heard about a $160 million refinancing loan on a Trump-owned Wall Street office building in 2015.
An internal document prepared by lender Ladder Capital said the 鈥渄eal strengths鈥� included Trump鈥檚 stated net worth of nearly $5.8 billion, over $300 million of it in cash and other liquid assets 鈥� figures that reflected Trump鈥檚 2014 financial statement.
鈥淭he net worth statement is one of many things that we look at in the underwriting process. I wouldn鈥檛 say it was a key factor 鈥� it was a factor,鈥� Ladder Capital executive Jack Weisselberg testified, explaining that 鈥渓iquidity was what we were really paying attention to.鈥�
Weisselberg is the son of former Trump company finance chief Allen Weisselberg.
The state attorney general is seeking $250 million and a ban on Trump and other defendants doing business in New York.
In a pretrial ruling, Judge Arthur Engoron found that Trump and his company engaged in fraud, and the judge ordered that a court-appointed receiver take control of some Trump companies. An appeals court has since at least temporarily blocked enforcement of that aspect of the ruling. If upheld, it could strip the ex-president of control over Trump Tower and other marquee properties.
Both Engoron and James are Democrats.
Associated Press writer Michael R. Sisak contributed to this report.