Trump & India: Solid business ties with realty projects

New Delhi, Feb 23, 2020-

US President Donald Trump will be on his first official visit to India on Monday but he has had a longstanding business relationship with India through his real estate projects in the country.

Trump’s business interests in India are among his largest outside the US, although not in the pink of health pretty much like his presidency.

India, in fact, is the largest portfolio of Trump’s real estate business outside North America.

According to a report by PropTiger.com, since entering the Indian market in 2013, the New York-based Trump Organization has launched luxury residential projects with a revenue potential of $1.5 billion through ties up with domestic players.

The company controls four ultra-luxurious residential projects, real estate market for which is a niche one, under the name Trump towers– located in Pune, Mumbai, Delhi and Kolkata — and an office tower in Gurugram, in the National Capital Region.

The Trump Organization’s business partners in India include Panchshil Realty, Macrotech Developers, M3M India and Unimark Group.

Trump Towers Pune are twin towers with the black glass facade, built in partnership with Panchshil Realty. Trump Tower Mumbai is a 75-storey building being by Macrotech Developers (formerly Lodha Group). Trump’s partners for the Trump Towers in Gurugram are M3M India and Tribeca Developers.

The latest Trump Towers project in India is being built in Kolkata, in partnership with Unimark Group.

The developers of the Kolkata and Gurugram residential projects also organised a three-day trip to New York for homebuyers. Around 150 guests also met the US President’s son Donald Trump Jr.

Market experts feel that although investments by the Trump Organization show that foreign players want to invest in India’s luxury realty segment, the company has not been able to garner a customer response as was expected.

“The Trump Towers which have come up in India so far are a testimony to the fact that this segment is acknowledged by global luxury brands eyeing India,” said Anuj Puri, Chairman, ANAROCK Property Consultants.

Puri added that the overall reception for Trump Towers has been positive but the “response was not as expected”.

Moreover several of Trump’s business partners are facing troubles. Macrotech Developers, formerly Lodha Group, which built the 75-story Trump Tower in India is reeling under huge debt and off late it has witnessed a few downgrades.

Ratings agency India Ratings and Research in December 2019 downgraded ratings of Macrotech Developers debt instruments to ‘IND BB’ from ‘IND BBB-‘ and maintained ratings on Rating Watch Negative (RWN). Moody’s Investors Service in November had downgraded the corporate family rating (CFR) of Macrotech to Caa1, from B3. A rating of Caa1 is given to entities with high credit risk.

Further, Atul and Sagar Chordia-run Panchshil Realty, the partner developers of 23-story Trump Tower in Pune ran into controversy following a meeting with Trump after he was elected President, sparking debates on conflict of interest.

Meanwhile, India’s real estate sector has been reeling under debt because of the ongoing slowdown. Rating agency India Ratings and Research (Ind-Ra) has maintained a negative outlook on the overall real estate sector for 2020-21.

Furthering its business interest, the Trump Organization may extend its portfolio to hospitality segment in India.

In an interview last year, Donald Trump Jr said that the Trump Organization would look at new branding and licensing deals in India, possibly even hotels, once his father demits office as US President.

As the President lands in India on Monday, there would be hopes of strengthening the bilateral ties and indications of a much expected trade deal.

But, irrespective of the bilateral ties between the two countries, Trump’s business relations with India, one of the largest markets in the world, seem to be growing, although with a few hiccups.  (Agency)

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