Trump puts 'brand' on Baja with condo-hotel

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					Trump puts 'brand' on Baja with condo-hotel

By Lori Weisberg and Sandra Dibble
STAFF WRITERS


October 22, 2006


In the world of real estate, Donald Trump has planted his flag
on many lands, from Manhattan and Chicago to more distant
reaches of the world, as in Seoul and the Grenadine Islands.
Now, the latest addition to his empire – Baja California.

Already a popular choice for Americans looking to invest in
oceanfront property, Baja's northern coast has caught the eye
of The Donald, who said he was drawn to the area, in part,
because of its proximity to San Diego.

Trump, whose mantra is “Location is everything,” is teaming
up with a Los Angeles-based developer to build a trio of
condo-hotel towers just north of Rosarito Beach that his team
is touting as the tallest and most luxurious in the area.                                 Getty Images
                                                                  Donald Trump says he will be a
                                                                  “significant” equity investor in a
“I've always liked the general location, because I'm in           Baja development bearing his
California a lot now with our L.A. project (on the Palos          name.
Verdes Peninsula), so anything in that state or nearby that
state that's on the ocean I like, and it's right next to San Diego,” Trump said during a
telephone interview. “It's just a place we think is very special.”

The 526-unit project, dubbed Trump Ocean Resort, will be perched on a 17-acre, cliff-top site
overlooking the ocean and a narrow beachfront in what developers say is, for now, a
relatively isolated location. While the site lies within the municipality of Tijuana, the resort
location is being marketed as North Baja, “only 30 minutes from San Diego.”

Of course, the biggest sales tool of all is the Trump name. The development's marketing team
takes pains to remind buyers of the Trump connection throughout its slick sales brochure.
And Trump himself, who's never shy about trumpeting
his own success, crows that his project will have the best
location and, of course, “the best brand.”

Having recently lent his name to a line of vodka, Trump
insists he's doing more than just branding a real estate
development. He says that The Trump Organization will
be a “significant” equity investor in the $200 million
project.

Trump's foray into Baja California comes at a time when
the area is in the midst of a building boom that began
with Mexican builders and is now drawing American
developers, as well as U.S. title insurance companies
and lenders. Where California coastal property is out of
reach for most Americans, oceanfront housing along
Baja's northern coast can be had for as little $200,000
or less.

Although foreigners cannot technically own property in
Mexico along the coast or near the border, they can
acquire land as beneficiaries of long-term trusts held by
Mexican banks.

Trump says he has twice visited the site of the planned
Trump Ocean Resort but did not become involved until
long after his development partner, Irongate, began                                  Trump Ocean Resort
scouting, and ultimately purchasing, land for the            Occupying 17 acres on a relatively isolated
project.                                                     coastal promontory in Baja California, the
                                                             $200 million Trump Ocean Resort, shown
                                                             in a rendering, will contain 526 units, each
A Los Angeles-based real estate development and              with an ocean view.
investment company, Irongate is also partnering with
Trump on a 463-unit condo hotel tower in Waikiki.

Baja California, right now, “is a very hot area, and I'm in the real estate business,” said
Trump. “Fifteen years ago, we wouldn't be having this conversation.”
His son, Donald Jr., who is working on the Baja project
and listened in during the interview with his father,
chimed in: “From our perspective, it's a great relative
value buy compared to oceanfront in San Diego.”

When a potential project just outside of Cancun fell
through, Irongate began looking elsewhere for an ideal
location where it could develop a resort property. Last
year, it began the process of acquiring the Baja site from
a very wealthy Mexican family who had owned it for
years, said Irongate co-founder Jason Grosfeld.

The land is about two miles south of the Playas de
Tijuana toll road entrance near an area known as Punta
Bandera.

“We were not looking for just any piece of land,”
Grosfeld pointed out. “This is on an outcropping, and it
doesn't have many neighbors. When you're there, you feel like you're the only ones there.”

The project will be designed as a luxury condominium hotel where owners can live in their
units or rent them out to hotel guests. The development will also include a number of
amenities typical of a resort hotel, including a fine dining restaurant, an infinity-edge pool,
lap and family pools, a spa, fitness center, tennis courts and walking trails.

Every unit, from studios to penthouse suites on the 25th floor, said Grosfeld, will have ocean
views visible from floor-to-ceiling windows.

“We'll even cook dinner in your condo if you want,” he said.

While pricier than many of the developments that are sprouting along the Baja Peninsula
from Tijuana to Ensenada, the Trump condos will still be affordable for an ocean-view
property.

Prices for studio units in the condo-hotel will start in the mid-$200,000 range, with one-
bedroom units expected to go for $400,000 to just under $700,000, according to Grosfeld.
Two-bedroom prices will range from $500,000 to under $1 million, while the cost of three-
bedroom condos will range from $700,000 to $1 million or more.

Penthouses, which will be designed with 20-foot ceilings, private gardens and plunge pools,



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                                               will start at more than $1.5 million.

                                               While condo hotels are becoming increasingly
                                               popular throughout the country, including San
Diego County, there are only a couple others planned along the Baja California coast. One
that is about to start construction is a 271-unit project being developed adjacent to the
Rosarito Beach Hotel. Prices there will range from $160,000 to $559,000.

Hugo Torres, owner of the Rosarito Beach Hotel and developer of the condo project, said that
Trump's decision to invest in Baja should be a boon for real estate development there.

“It's the best thing that could happen to have such a name invested in this area,” said Torres.
“It will bring more confidence to people coming down here and buying.”

Gabriel Robles, president of Resort Real Estate Developers Association of Baja California,
agrees.

“This really validates completely what we've been saying for a long time, that this is a great
place to do business,” he said. “The entrance of big players like this will certainly enhance the
area.”

Although the real estate market in the San Diego area has been slumping, and sales south of
the border are slowing, Trump said he is not concerned, nor is he worried about competition
from other Baja California projects.

In the true Trump style of self-aggrandizement, he hastened to point out that his projects
succeed in areas where others are failing.

“I think ours will be the best location, and we'll have the best brand,” said Trump. “You know,
we're on the cover of Forbes, we're in Business Week.

“Right now, the Las Vegas market is not great, and we're sold out but everyone else is dying.
We're doing really well. We're doing a project in Hawaii, and it's literally through the roof.”

While Trump's current real estate portfolio – including an exclusive golf resort under way in
Rancho Palos Verdes – is keeping him busy these days, as is a new season of “The
Apprentice” starting next January, The Trump Organization is always scouting the world for
new places to leave its imprimatur. And that includes San Diego.

“San Diego is one of my favorite places in all the world,” said Trump. “It has perhaps the best
weather of any place I know. Absolutely, I would be involved in San Diego if the best
opportunity presented itself.”

While he's currently exploring a couple of possible projects in San Diego, it's too early to say
if they'll come to fruition, Trump said.

But the more he talked, the possibilities seemed to brighten.

“The chances of us doing something in San Diego,” he said, “are very good.”