The Trump International Hotel in Washington has become the crown jewel of the Trump Organization ever since President Donald Trump took office in January. Since the his swearing in, the president’s second property along Pennsylvania Avenue has hosted foreign lobbyists, banking executives, and others attracted to the luxury brand created by the President of the United States. It has also become extremely profitable.
Trump’s Washington hotel has raked in about $18 million in the four months following Trump’s inauguration. Out of the $18 million made in revenue, the hotel made a profit of nearly $2 million despite budgeting for a $2.1 million loss.
The hotel is profitable despite a “44.4% occupancy rate compared with 69.5% for comparative hotels.” This is because people pay more to stay at the Trump hotel than any other place in DC.
So far this year, guests have paid an average of $652.98 a night to stay there, significantly higher than the projected daily rate of $416. According to data provided to the Washington Post by Smith Travel Research, the politically inflated rates at the Trump International have even made it the most expensive hotel in Washington DC, with guests staying at comparable hotels like the Hay-Adams, Four Seasons, and Willard only paying an average of $495 a night. Even the food and beverage at the hotel has seen a hike in prices, with the cheapest cocktail at the bar priced at $24, up from $16. The bar’s signature cocktail, featuring caviar and a raw oyster, goes for an even $100.
The exorbitant prices is bolstering the claim that the hotel is, essentially, a way to buy favor and influence with the president.
“The Trump hotel seems to be able to profit off a much smaller group, even though it is more than half empty. They are still turning an unexpectedly large profit,” said Jordan Libowitz, spokesperson for the watchdog group Citizen For Responsibility and Ethics in Washington (CREW). According to Libowtiz, this small group is able to “buy influence with the president and his staff” by staying at his properties and these certain people are “willing to pay a vast premium” in order to gain access to the president, which is why they are able to charge at a much higher rate than other hotels in the area.
There appears to be a significant correlation between the election of Donald Trump and the rise of revenue at the Trump International Hotel in Washington. In July, Democratic representatives released a report on the hotel called, “Breach of a Lease: The Tale of the Old Post Office in the Swamp.” In it, the representatives detailed that the property underperformed in the initial months of operation, earning $1.3 million in revenue in September and $2.8 million in October, but according to the new GSA documents, revenue rose to $4.7 million in April.
In November, a Chinese diplomat told the Washington Post: “Why wouldn’t I stay at his hotel blocks from the White House, so I can tell the new president, ‘I love your new hotel!’ Isn’t it rude to come to his city and say, ‘I am staying at your competitor?’ ” While only a few months ago, Saudi lobbyists spent around $270,000 in accommodation and catering fees for U.S. veterans who the firm retained as part of a campaign to influence politicians.
The recent revelations in the property’s finances are from documents posted on the Government Services Agency (GSA) website. The GSA owns the lease to the Old Post Office, the building which was later developed into the Trump International Hotel.
Concerns over politicians, foreign nationals, and lobbyists spending their money at Trump properties as a way to curry favor with the U.S. president is why CREW filed a lawsuit against President Trump alleging that he his involvement with his business empire while in office violates the Emoluments clause of the Constitution. The case involves four plaintiffs who claim the Trump Organization has benefited unfairly by creating improper competition for other catering services and hotels in the area and also by doing businesses with foreign governments.
A U.S. Federal District court has set a date for oral arguments on that case for October 13. The memorandum filed with the court says Trump “has wasted no time continuing and even expanding his financial entanglements with foreign and domestic governments since taking office. As a result, he has received (and will continue to receive) ‘presents’ and ’emoluments’ prohibited by the Foreign and Domestic Emoluments Clauses.”