By Daniel A. Espinosa, Esq.,
In my article written in January 2012, I commented on the prospective purchase of the Doral Golf Resort & Spa by none other than, Donald Trump. True to form, The Trump Organization was the highest bidder at the auction and purchased Doral for $150 million. My January article focused also on how Trump’s interest in purchasing Doral came at a time when the Florida Legislature was addressing the issue of casino gambling for large resorts in South Florida. Since then some things have changed, others have not.
Not surprisingly, this legislation has been heavily lobbied during the 2012 session. On the one hand, supporters of the bill suggest it would create tens of thousands of jobs. On the other hand, opponents argued it would take business from resorts and dog tracks while damaging the state’s family-oriented brand.
Earlier last month Florida lawmakers rejected a plan to bring three major casinos to the Miami area. It appears as though the proposal is most likely doomed for the year following a House panel’s decision to postpon their vote on the bill—it is not expected to be considered again during this session. The bill would have granted casino licenses to major developers, all of which have pledged at least $2 billion on resorts. Although it appears gambling may not come to South Florida this year, Malaysian gambling company Genting Group, which has invested nearly a half-billion dollars in Miami real estate, says it won’t give up efforts to build a casino in Miami.
The one thing that remains unchanged is that the Doral purchase is a great investment for Trump. To put it in perspective, Morgan Stanley subsidiary CNL Hotel and Resorts Inc., purchased Doral for $501 million back in 2007. Trump is purchasing it five years later for almost a quarter on the dollar. Essentially, this means the value of the resort has fallen approximately $350 million in the past five years. Trump is buying the Doral out of bankruptcy court after one investment fund purchased it from another. A New York bankruptcy judge cleared the way for a settlement with Marriott, Doral’s current management company, over its early-termination fee. Ultimately, however, Trump won the right to match other bids for the resort, with other suitors forced to pay him millions if he chose not to meet their offers. Trump plans to close on the sale in June 2012, with renovations lasting through the fall of 2013.
A day after announcing his $150 million purchase of Doral, Trump portrayed his investment as a rescue mission. “We’re going to make Doral really great,” Trump said in an interview. “We’re going to spend tons of money and bring Doral back to the highest levels of golf.” Apart from renovating the resort & spa, Trump plans to remake Doral’s golf courses.
Specifically, he plans to have golf course designer Gil Hanse—who helped design Castle Stuart and restore the North Course at Los Angeles Country Club—redesign all four of the property’s courses: TPC Blue Monster, Red Course, Gold Course, and the Jim McLean Signature Golf Course (formerly known as the Silver Course). The avid golfer, who claims to have a single-digit handicap, said the TPC Blue Monster will be better than ever. “The first hole is a 525-yard par five. We’re lengthening it by almost 100 yards,” Trump said.
From March 8 – 12th, 2012, the Doral will play host to the pro-golf tour’s biggest stars, including Rory McIlroy, Phil Mickelson, and Tiger Woods, when the WGC-Cadillac Championship is played. “It’s always been one of the tour players’ favorite courses,” Trump said of the TPC Blue Monster.
While Trump is promising a major upgrade of South Florida’s most famous golf resort, his team of lawyers and business executives are working diligently behind the scenes to ensure that Doral is ripe for the kind of investment that will allow Trump to attract wealthy golfers from around the world. As part of the deal, Marriott will leave as operator of the property in exchange for an undisclosed termination fee.
When asked about the budget for his renovation plans, Trump replied: “Unlimited.” Then he added: “It’s nice when you can write those checks. This is a great thing for Miami . . . if one of the funds bought it, here we go again. They’ll try and flip it a few years later for a profit. For me, it will be staying in the family.”
Trump said his company will begin running the property by June 2012, and will keep the Doral open during the anticipated 18-month renovation plan. It will be the largest of Trump’s hotels. Folks, this a great purchase not only for Trump, but also for Doral residents and all of Miami-Dade County. This will increase tourism in Doral and Miami-Dade County by creating an influx of cash and spending, particularly in areas such as the new Millionaires Row of stores which will be located in Midtown, just a few blocks from my law firm.
For now, my recommendation is that Doral residents celebrate and enjoy the tournament. Golf has a new # 1 player in the world named Rory McIlroy, a young Northern Irishman. Although Tiger made an impressive charge at the Honda Classic’s PGA National Golf Course a couple of weeks ago, I believe he will finish in tenth place, at best. I’m rooting for Rory or Phil to win. But the true winners at Doral are undoubtedly Donald Trump and all Doral residents.
Daniel A. Espinosa, Esq., is the founding partner of ESPINOSA | JOMARRON, a full-service law firm in Miami’s Midtown area. For more information, you can e-mail him at firstname.lastname@example.org. Feedback, comments, and questions are welcomed.