Trump: The Art of the Deal

long before he became president, donald trump was widely known as a real estate mogul and dealmaker who shaped some of new york city’s most iconic developments. he built a reputation for transforming high-risk projects into major successes, navigating complex negotiations, and leveraging his personal brand. whether it was reviving crumbling hotels or pushing through bold real estate ventures, his approach was marked by persistence, adaptability, and a hands-on leadership style.

in this chapter, you’ll learn how trump approached deal-making, handled negotiations, and turned daring ideas into reality – always with an eye on seizing opportunities and controlling outcomes.

ready to step into a day in the life of trump, the businessman? let’s go.

what was life like for donald trump throughout the 1970s and 1980s? during this period, his days often began early, around six in the morning, with a scan of the newspapers before heading into the office. trump’s approach to work was far from traditional. he avoided rigid schedules and structured meetings, preferring a more spontaneous, flexible routine. for him, the real excitement came from making deals – not just for financial gain, but for the thrill of the process itself.

a good example of trump’s business instincts in action is his intervention in the case of annabel hill, a widow in georgia on the verge of losing her family farm after her husband’s tragic suicide. hearing about her situation, trump immediately contacted the bank, threatening legal action and accusing them of driving her husband to despair. the bank quickly backed down, and trump raised $40,000 to cover her debts – even pledging to cover any remaining amount himself. his swift, no-nonsense approach resolved the issue and garnered media attention, showcasing his ability to turn challenging situations around with bold, decisive action.

trump’s routine was filled with phone calls and impromptu meetings, and he often had 50 to 100 calls a day. his spontaneous style allowed him to handle multiple projects at once – whether it was overseeing construction at trump tower, managing the renovation of central park’s wollman rink, or making investments in holiday inns. by staying involved in the details of his various projects, trump could react quickly to changes and seize new opportunities as they came.

when it came to business negotiations, trump also emphasized flexibility. in his investment with holiday inn hotels, for example, he kept several options open – taking control of the company, selling shares for profit, or letting the company buy them back. by keeping his options fluid, trump could maintain control and choose the outcome that best suited his goals.

quick, decisive, adaptable – that was trump’s early business playbook. his hands-on involvement and passion for the process were all part of his ability to recognize and capitalize on opportunities in real time.

now let’s take a closer look at trump’s philosophy when it comes to making deals.

in the 1970s, donald trump was just beginning to make his mark in manhattan real estate. one of his first big moves was acquiring an option to purchase the penn central rail yards. initially, his plan was to build middle-income housing with government financing. but when the city’s financial problems derailed public funding, trump didn’t dwell on the setback. 

instead, he shifted his focus to a new idea: promoting the site as the future home of a convention center. his persistence paid off, and the city ultimately built its convention center on that very site. this ability to adapt and maximize options became a hallmark of trump’s deal-making strategy.

one of trump’s guiding principles is to protect the downside in any deal. he’s often perceived as a risk-taker, but he actually goes into every deal prepared for the worst possible outcome. by planning for the worst, he’s able to minimize risks and avoid catastrophic losses. 

another key element of trump’s strategy is maintaining flexibility. he never gets too attached to a single deal or approach, which allows him to pivot when necessary. if one plan doesn’t work out, he has several others ready. this mindset helped him navigate early deals, like his acquisition of the rail yards, and continues to serve him in complex projects. trump always looks for ways to keep his options open, ensuring that he’s never boxed into a corner.

he also emphasizes the importance of knowing your market. why rely on expensive consultants or detailed market research when you can gather insights by talking to people directly? whether it’s a cab driver or a local resident, trump listens to real-world opinions and trusts his instincts when making decisions.

ultimately, trump’s deal-making philosophy revolves around thinking big, protecting against downside risk, and maximizing opportunities. by staying flexible and informed, he positions himself for success in a variety of ventures – always ready to adapt and move forward.

when donald trump first considered the commodore hotel, many saw it as a lost cause in a declining part of new york city. positioned next to grand central station, the hotel was run-down, and the surrounding area was struggling. where others saw decay, trump saw opportunity. he noticed the steady stream of affluent commuters passing by daily and believed that with the right vision, the commodore could be transformed into a thriving success. trump saw potential for a complete transformation.

he quickly moved to secure an option on the commodore, allowing him time to put together a deal without risking too much of his own money. his plan involved renovating the old, gloomy building and covering it with a sleek glass façade to give it a modern appearance. to bring this vision to life, trump partnered with architect der scutt and secured the backing of hyatt hotels, who were looking to establish a flagship location in new york.

the next challenge was finding financing at a time when new york city’s economic outlook was bleak. trump, alongside real estate broker henry pearce, presented the banks with an ambitious vision of how the commodore could revitalize the neighborhood. but that wasn’t enough. banks were hesitant to lend, even with hyatt as a partner. trump’s breakthrough came when he successfully negotiated a 40-year tax abatement with the city, arguing that the project would create jobs and save a deteriorating area from further decline. this tax relief was the key to convincing lenders to support the project.

even after securing financing, trump faced criticism from competitors and city officials, who questioned the fairness of the deal. but trump remained firm, insisting that the only way to make the project work was with the terms he’d negotiated. the result was a complete transformation of the commodore into the grand hyatt, which opened in 1980 to immediate success. the hotel exceeded expectations, and its reflective glass design, once criticized, became admired for enhancing the surrounding architecture.

through this project, trump demonstrated his ability to see opportunity where others saw obstacles. his strategic risk-taking, willingness to push for favorable terms, and determination to turn around a failing property helped him achieve a major victory early in his career.

at a time when donald trump was still establishing himself as a developer, he set his sights on one of new york city’s prime real estate locations: the bonwit teller building at 57th street and fifth avenue. 

it was the early 1970s, and trump, though young, recognized the potential to transform the site into something iconic. his initial approach to franklin jarman, head of genesco – the company that owned bonwit – was quickly dismissed. but trump’s persistence was unwavering. over the next few years, he continued to follow up, staying on jarman’s radar until financial troubles forced genesco to sell assets. this opened the door for trump to secure the property.

once he had the opportunity, trump moved strategically to assemble all the elements necessary for the development. first, he secured a partnership with equitable life assurance, the owner of the land under bonwit teller, which gave him full control of the site. next, he negotiated with tiffany & co., whose air rights were crucial to his vision for a much larger building. convincing tiffany’s owner, walter hoving, who highly valued trust in business, was another milestone. hoving agreed to sell the air rights on a handshake, underscoring the importance of personal relationships in closing major deals.

trump also faced the challenge of obtaining zoning variances and financing for the ambitious project. working closely with city planners, he navigated the regulatory landscape to maximize the size and visibility of the new building. his efforts paid off, and he ended up attracting top-tier retailers and buyers. trump’s ability to generate excitement and value around trump tower became a defining factor in its eventual success.

one of the key lessons from the trump tower project is the importance of persistence and adaptability. trump overcame numerous challenges, including initial skepticism from city officials and public controversy over demolishing art deco sculptures from the bonwit building. yet, through persistence and strategic thinking, he realized his vision for trump tower – which would go on to become one of the most successful and iconic buildings in new york.

the story of trump tower shows the power of staying determined in the face of obstacles, seizing opportunities as they arise, and building strong personal relationships to achieve success. these principles were critical in transforming prime real estate into a globally recognized landmark.

in 1975, a news report about a strike in las vegas caught donald trump’s attention. despite hilton hotels owning more than 150 properties, just two of their casinos in las vegas accounted for 40 percent of their profits. that moment revealed the immense potential of the casino industry to trump – prompting him to investigate the opportunities in atlantic city, which was considering legalizing gambling at the time. when the referendum passed in 1976, property values skyrocketed, but trump waited, choosing patience over speculation.

by 1980, a prime piece of boardwalk property became available, and trump saw his chance. the site was strategically located near the convention center, but it came with complications – legal disputes, fragmented ownership, and holdout owners. where others saw obstacles, trump saw opportunity. he negotiated long leases and purchased the remaining parcels, ensuring that the entire site was his before moving forward.

licensing for a casino in atlantic city was notoriously difficult. trump observed how companies like playboy and caesars faced hurdles, often requiring a “sacrificial lamb” – an entity that bore the brunt of regulatory challenges – to secure approval. unlike others, trump wanted a completely clean process, so he waited to begin construction until after securing his license; that way, he wasn’t vulnerable to any regulatory setbacks. his strategic approach paid off, and he received his license in just six months.

an unexpected opportunity came when michael rose, the chairman of holiday inn, approached trump about partnering on the project. holiday inn brought valuable gaming experience, and trump’s reputation as a developer who completed projects on time and under budget made the partnership appealing. they struck a deal, with holiday inn managing the casino and both sides splitting the profits 50-50.

through careful planning and value engineering, trump kept construction costs under control. and as anticipated, he completed the casino on time and slightly under budget in may 1984. the facility opened to great fanfare, and the casino was immediately successful, drawing large crowds.

despite its initial success, trump had significant disagreements with holiday inn over management. in 1986, he bought out their share, taking full control of the casino and securing the financial benefits, including valuable depreciation deductions. he then refinanced the project through a public bond issue, further strengthening his position.

with his atlantic city project, trump demonstrated how to seize opportunities, manage risks, and leverage partnerships to achieve long-term success. it all came down to understanding timing, mastering negotiation, and maintaining control.

donald trump scoffed as he read a new york times article reporting that new york city was restarting the renovation of wollman rink after six years of failed efforts and millions of wasted dollars. frustrated by the city’s inefficiency, trump compared the ongoing failure to his own successful completion of trump tower in the same timeframe. he felt compelled to take action and wrote to mayor ed koch, offering to personally finance and rebuild the rink at no cost to the city.

koch initially brushed off trump’s offer, saying the city didn’t need his money and couldn’t accept it even if they wanted to, citing legal hurdles. but this only fueled trump’s determination. with media support building, the mayor quickly reversed course, granting trump control of the wollman rink project. 

trump’s approach was simple: get the job done quickly, efficiently, and correctly. he brought in experts from cimco, a canadian company known for ice rink construction, and switched to a reliable brine system over the city’s failed freon approach. from the start, trump emphasized hands-on leadership, visiting the site daily and holding contractors accountable for deadlines and costs.

the city’s prior efforts were riddled with incompetence – they’d installed pipes on a sloped base, used faulty concrete, and allowed critical delays. trump’s team fixed these issues swiftly, coming in under the $3 million budget and completing the rink in just four months, well ahead of the city’s two-year projection. his attention to detail and firm oversight ensured that the job was done efficiently and professionally.

the rink opened to the public in november 1986 with a grand celebration, featuring some of the world’s top figure skaters. in its first season, the rink generated $1.2 million in revenue – far exceeding its previous earnings under city management. all profits were donated to charity and the parks department.

trump attributes this success to strong leadership, effective project management, and the ability to hire top-tier professionals. the wollman rink project became a powerful example of how private enterprise can often outperform bureaucratic government efforts, reinforcing trump’s belief in hands-on leadership and the importance of accountability in getting results.

the main takeaway of this chapter to trump: the art of the deal by donald j. trump and tony schwartz is that success comes from persistence, adaptability, and a hands-on approach to leadership. whether you’re navigating complex negotiations, reviving failing projects, or tackling bureaucratic inefficiencies, the ability to spot opportunities and act decisively will set you apart as a strong business leader.

trump’s experiences show the importance of maintaining flexibility in strategy, protecting against downside risk, and building strong relationships to achieve long-term success. ultimately, his story emphasizes that with the right mindset, obstacles can be turned into stepping stones for future victories.

ok, that’s it for this chapter. we hope you enjoyed it. if you can, please take the time to leave us a rating – we always appreciate your feedback. see you soon.