If there is one key question raised by Donald Trump’s fruitless pursuit of Hamilton Hall, the iconic sandstone property overlooking the home of golf, it is why he asked the Bank of Scotland to provide financing for the deal.
Out of four offers he or his companies proposed for the St Andrews landmark, two stipulated that Trump’s firm would in turn receive either a mortgage, a loan, or both.
On 15 October 2008, the date he submitted his first offer to the bank, he proposed a purchase price of £23m, yet asked for a mortgage for the same amount, as well as a construction loan for £15m.
Assessed in isolation, the fact Trump sought out financing for what would have been his first international hotel venture is far from unusual. That is, after all, how he has conducted his business over much of his career.
Three decades ago, for example, he bought the Plaza Hotel in his old stomping ground of New York. The purchase price was £306m, but Trump secured a loan to the tune of £319m. That same year, he boasted to a reporter of how invested with other people’s money, remarking: “If the world goes to hell in a handbasket, I won’t lose a dollar.”
READ MORE: A history of Hamilton Hall
Meanwhile, in his 2006 book, ‘Trump Strategies for Real Estate’, George Ross, a Trump Organisation counsel, relayed the secret of his boss’s success. “Borrow as much as you can for as long as you can,” he bluntly advised.
But in the context of what Trump and his staff said about the Trump Organisation’s finances around the time of that October 2008 offer for Hamilton Hall, the structure of the proposed deal seems curious.
On 3 November 2008, just three weeks after Trump asked the Bank of Scotland for £38m, he gave an interview to The Scotsman in which he claimed the Trump Organisation would be able to withstand the ill winds of the global recession.
“The world has changed financially and the banks are all in such trouble, but the good news is that we are doing very well as a company and we are in a very, very strong cash position,” he said.
On 16 November, meanwhile, George Sorial, executive-vice president at the Trump Organisation, also spoke to The Scotsman, where he offered more in the way of detail.
Trump, he said, had £1bn in cash “sitting in the bank and ready to go” to finance his Trump International Golf Links course in Aberdeenshire course, which had been granted outline planning permission by the Scottish Government at the start of the month.
Sorial pointed out that Trump had “recently increased his cash position,” meaning there was “no need for a bank loan.”
He added: “I am not discussing where it is, whether it is in a Scottish bank or what, but it is earmarked for this project.
“If we needed to put the development up tomorrow, we have the cash to do that. It is sitting there in the bank and is ready to go.”
It may be, as Sorial suggests, that the £1bn was set aside exclusively for Trump International Golf Links. But if that is the case, another element of Trump’s letter to the Bank of Scotland stands out.
In the second last paragraph, he told the bank he would honoured” to use it as the Trump Organisation’s “primary bank for all our United Kingdom enterprises, in particular, the Aberdeen development.”
The Trump Organisation did not respond to questions from Scotland on Sunday about its finances, but annual reports for the companies behind his Scottish resorts show he has no banking facilities associated with them.
In fact, Trump paid £9.5m in cash for the land in Aberdeenshire, and bought Turnberry in a £35.7m cash deal. Companies House records also show he has gone to provide them with £153m in interest-free loans.
Amid the ongoing debate as to the source of the money underpinning Trump’s businesses, the detail of his offers for Hamilton Hall opens up yet another line of enquiry.