Property investors sue developers of Trump Tower in Hawaii
Two groups of property investors are demanding their money back from the developers of the upscale Trump International Hotel & Tower in Waikiki, Hawaii over claims that the property tycoon was directly tied to the project.
In a lawsuit they claim that developer, Irongate Capital, misled them that millionaire businessman Trump was a co-developer when in fact the project merely has a licence to use his name which could be withdrawn in the future should he wish to terminate his association with the development.
Former Hawaii Attorney General Warren Price who is representing a group of Japanese investors said Irongate concealed the terms and conditions of the license, which the company was legally obligated to provide to his clients before they signed their sales contracts.
'That Donald Trump was not a co-developer or partner of defendant (Irongate) was clearly a material fact that defendant had a duty to disclose completely and clearly before plaintiffs signed their sales contracts so they could make a fully informed decision to invest in this 'Trump project,' the lawsuit states.
'In light of this, under the law of Hawaii, our clients can rescind their sales contracts and seek the return of their full deposits plus interest, the remedy sought in this lawsuit,' Price said.
He added that his clients are concerned about what would happen if Trump terminates the license and his name is removed from the project. 'If this were to occur, our clients' investment in a one-of-a-kind Trump project would instantly turn into an investment in just another Brand X condo/hotel in Waikiki that is not on the beach which was not the investment our clients intended to make,' Price explained.
He also pointed out that the developer recently sent a letter and a brochure to buyers confirming that Trump is not an owner, developer, pr seller of this project.
Another group of local investors have filed a similar claim. In their lawsuit they claim that California-based Irongate Capital misled buyers by describing Trump in its press releases as a co-developer of the 464 room condotel.
They also complain that promotional material stated that rentals are supposed to be managed by a third party when Irongate 'will, in fact, control and administer the rental programme'.
More buyers are expected to take legal action. Price is representing more Japanese buyers who bought through a sales company rather than direct from Irongate.
Irongate said the allegations were groundless. 'A small group of individuals filed suits. We believe that all of the claims are without merit and we intend to vigorously defend ourselves,' Irongate said in a statement.
Scheduled for completion in September, the Trump Waikiki is one of the most expensive residential projects ever built in Hawaii.