I suppose it's here I should make the customary Georgist call for Land Value Tax.

The opposite, I think. Lvt does not tax the value of improvements. And while lots can be very valuable, they are not very valuable compared to the improvement if the improvement is a skyscraper.

Construct some building in the middle of nowhere, in the middle of the Sahara desert or something, and see if it increases or decreases in value.

The structure itself will depreciate somewhat, and that's all.

...It's the location for a structure that is responsible for increases and decreases in real estate.

Yeah, but it wasn't plain land, there was a building on it.

the genius who downvoted this comment - please google how land value tax works.

Here's the evidence, Vasili:

Trump buys an office building in downtown Manhattan in 1995 - the year he allegedly lost $1 billion. All cash. He then borrows $145 million from a union pension fund to carry out a $35 million renovation. The previous owners, a Hong Kong company that may have been a front for Ferdinand Marcos, bought the building for $8 million two years before Trump and also renovated it. The building sits on top of land that is owned by a shady overseas partnership whose principals are unknown. Trump recently refinanced that mortgage after the building changed hands, receiving $160 million from Ladder Capital.

Fall, 1995: Donald Trump purchases 40 Wall Street for $1 million cash. “Donald Trump has hired Cushman & Wakefield as leasing agent for 40 Wall St., which he plans to rename The Trump Building at 40 Wall. Mr. Trump bought the 1.1 million-square-foot building last fall for $1 million in cash and is seeking office tenants. He has secured a loan commitment on the property.” (Crain’s New York Business, February 19, 1996)

Trump purchased the building from a company based in Hong Kong that had paid $8 million to acquire it two years earlier. “The real estate developer Donald J. Trump completed his purchase of 40 Wall Street yesterday, buying the distinguished 70-story office building, across the street from the New York Stock Exchange, for a price estimated at less than $8 million. Mr. Trump in July had disclosed an agreement to buy the building, which contains 1.1 million square feet of space, from Kinson Properties of Hong Kong. Kinson paid $8 million for it in 1993. While representatives of Mr. Trump declined to disclose the price he had paid, published reports said it was less than $8 million. In July, representatives of the developer said he planned to spend $100 million converting the building, which is 89 percent vacant, to more modern offices. The land on which the building stands is owned by the Hinenberg family of Germany.” (New York Times, December 7, 1995)

v Previous owners from Hong Kong made substantial renovations to the building, installing a $300,000 pool in the lobby. “But as more Chinese investors have come to the New York area, feng shui has become an increasingly familiar term to developers and designers. The former Gulf and Western Building on Columbus Circle, 40 Wall Street and the China Trust Bank in Flushing, Queens, are among projects in which developers called in feng shui experts to review the sites. […] Edmund Yu, president of Kinson Properties, which is renovating the 1.1-million-square-foot office building at 40 Wall Street, said that even though he was an avowed nonbeliever, he still commissioned the construction of a $300,000 pool in the building's lobby on the advice of a feng shui master. ‘It's like killing two birds with one stone,’ he said. ‘Other people will just see it as an attractive addition. But for the Chinese, when they see it, they will know.’” (New York Times, September 22, 1994)

v A financial reporter claimed that Trump had acquired the building from a front man for Ferdinand Marcos. “It is the possibility of loss now, when markets have performed so well for so long, that preoccupies James Grant, the author of "The Trouble With Prosperity." No one knows 20th-century financial history better than Mr. Grant, and it shows as he glides through eras when investors thought everything was wonderful, only to be stunned when something went wrong. The best part of the book is Mr. Grant's tale of a New York building, 40 Wall Street, conceived in the 1920's and now being renovated by Donald Trump, who got it after Citibank sold it for a fraction of the loan it had foolishly made to a front man for Ferdinand Marcos, the late Philippines dictator.” (New York Times, December 22, 1996)

Renovations of 40 Wall Street were financed by loans from a union pension fund. “Mr. Eichner had earlier persuaded the Union Labor Life Insurance Company (Ullico), a union fund manager that invests in projects that employ union labor, to commit $33 million in long-term loans for his almost-completed 25-story, 121-apartment condominium at 201 East 80th Street, called the Richmond. […]General Electric Pension is behind the joint venture that rebuilt Trump International Hotel and Tower at 1 Central Park West, formerly the Gulf & Western Building; the Ullico is financing Mr. Trump in his $35 million rehabili-tation of 40 Wall Street, which, he says, will have a completed lobby in three weeks.” (New York Times, January 26, 1997)

2015: Trump used the building as collateral for a $160 million from the hedge fund, Ladder Capital. “Currently, 14 entities with ties to Mr. Trump owe banks in excess of $315 million, according to the disclosures released by the Federal Election Commission. The actual amount of debt is not known and is higher -- presidential candidates are required to reveal only debt of $50 million or above, without further specificity. For instance, a Ladder Capital loan secured by a lease at 40 Wall Street is for $160 million.” (New York Times, May 24, 2016)

Trump pays a $1.6 million lease on the ground under the building to an unknown investment group with German ties: ““At 40 Wall Street in Manhattan, a limited liability company, or L.L.C., controlled by Mr. Trump holds the ground lease -- the lease for the land on which the building stands. […] The land is owned by two limited liability companies; Mr. Trump pays the two entities a total of $1.6 million a year for the ground lease, according to documents filed with the S.E.C. The majority owner, 40 Wall Street Holdings Corporation, owns 80 percent of the land; New Scandic Wall Limited Partnership owns the rest, according to public documents. New Scandic Wall Limited Partnership's chief executive is Joachim Ferdinand von Grumme-Douglas, a businessman based in Europe, according to these documents. The people behind 40 Wall Street Holdings are harder to identify. For years, Germany's Hinneberg family, which made its fortune in the shipping industry, controlled the property through a company called 40 Wall Limited Partnership. In late 2014, their interest in the land was transferred to a new company, 40 Wall Street Holdings. The Times was not able to identify the owner or owners of this company, and the Trump Organization declined to comment.” (New York Times, August 21, 2016)

v Trump has used 40 Wall Street as collateral to secure a $160 million loan from hedge fund Ladder Capital that includes a $26 million personal guarantee: ““In 2015, Mr. Trump borrowed $160 million from Ladder Capital, a small New York firm, using that long-term lease as collateral. On his financial disclosure form that debt is listed as valued at more than $50 million. […] Other instances in which Mr. Trump could be personally responsible can be found in public filings. He guaranteed as much as $26 million for the loan taken out against his land lease at 40 Wall Street, money the lender could take if certain things went wrong.” (New York Times, August 21, 2016)

40 Wall Street has lost money or barely eked out a profit for the past several years, but pays the Trump Organization a nearly $1 million management fee. “Another seeming cash cow, at least as far as the forms portray it, is 40 Wall Street, an office building Mr. Trump has spoken of as perhaps the greatest bargain he ever struck. ''I make approximately $20 million a year in rentals from 40 Wall Street and the building is now worth $500 million,'' Mr. Trump wrote in ''Trump Never Give Up,'' published in 2008. '[…] On his financial disclosure forms, Mr. Trump listed the income he derived from rents in the building in the highest category on the form -- more than $5 million. […] But the income and expense statement that he filed with the New York City Tax Commission to appeal his property taxes shows that after mortgage payments and other costs, the building produced a cash flow of about $104,000 in 2014. Over the previous three years, it had generated a negative cash flow of $5.5 million, as the fallout of the 2008 financial crisis took a toll on downtown office buildings. Last year, the building rebounded and turned a significant profit: Occupancy rose to 95 percent, according to securities filings. The building's cash flow after expenses was just under $3 million, still well below the more than $5 million that Mr. Trump reported on his disclosure forms. The building also paid the Trump Organization $966,000 last year in management fees. (New York Times, November 4, 2016)

10/23/05: Trump took out a $145 million mortgage on 40 Wall Street, spent $35 million acquiring and refurbishing it. “And Donald did scramble back to gain control of some other Manhattan buildings, including 40 Wall Street, which he spent about $35 million to buy and refurbish in 1996. The building has about $145 million in debt attached to it, and New York City tax assessors currently value the property at about $90 million. Donald values it at $400 million.” (New York Times, October 23, 2005)

I get it, you don't like Trump. I don't like him either. But the above doesn't seem like evidence of anything other than real estate dealings.

I won't argue it anymore. Apologies for the ad hominem attacks.

Apology accepted!

Hi Vasili - I don't think you understand. He bought an office building on Wall Street in the mid-1990s for $1 million. That's a price so low that it's shady. As usual with Trump, he buys real estate at prices that don't make sense unless you assume there's another half to the trade. Then he borrows money against the building's supposed increase in value and uses that debt as income without an income tax. His deals are all funny numbers.

I see you're also an apologist for Facebook's approach to Russian ads during the election.

You've stooped to the kind of personal attack that is most unwelcome in HN threads, especially partisan/political flamewars that we don't want on HN in the first place.

We ban users that do this, so please (re-)read https://news.ycombinator.com/newsguidelines.html and clean up your act if you want to keep commenting here.

do you have any evidence that buying an office building on wall street for 1 million in the 90s is a shady price that doesn't make sense? also, how in the world did you bring facebook into this conversation?

It’s not just “an office building”, it’s a 71 story skyscraper. Even setting aside its highly desirable location a $1M price makes no sense.

The thing is, though, that the only source I can find for the $1M purchase price is Trump’s own mouth, while bragging about its real value (hundreds of millions), and we know he lies and exaggerates all the time.

Ok, so either way my point stands. There is no evidence whatsoever that something illegal is taking place ? The op posted this article

http://www.nytimes.com/1995/12/07/business/40-wall-street-is...

So apparently he bought it roughly for market price ?

>There is no evidence whatsoever that something illegal is taking place ?

Why would you want evidence that something illegal was taking place if something illegal was taking place? Sure in the absence of evidence I do believe we cannot declare anyone guilty, but the presumption of innocence doesn't mean we can't cast suspicion.

How is 1/8th of the price "market price"? Quite the opposite. You seem to have trouble addressing facts here.

EDIT: Responding to your answer below. You are materially misreporting the substance of the NYT article, which I find to be telling. It says that the building was sold for $8 million two years before, and that Trump paid "less than" that.

Did you read the article you posted ? Where does it say he bought it for 1/8th the price ? It doesn't say that anywhere in your article

Bloomberg claims Trump bought the right to lease the building for the next 60 years or so. Trump does not own the property at 40 Wall Street. He is paying something like $1.5 million per year in rent. He bought the rights to lease the building from someone who previously bought those rights for the mostly empty building for $8 million but were having trouble getting tenants. It isn't clear if Trump bought all of the same rights or if they retained some.

The people who previously had the rights to lease out the building paid $8 million, but along with that came the responsibility of paying rent to the landowner. If they hadn't been able to make progress in two years, it doesn't seem outlandish that they would be willing to sell for much less than they paid. Their big expense wasn't going to be the cost of the rights to lease the tower, but the actual cost of leasing the tower (or maybe it is better to say the land the tower sits on) over time.

Further, they may have retained some rights that they found valuable so I wouldn't assume that what they bought for $8 million was the same thing Trump says he bought for $1 million.

So was the deal "shady"? Not from any information presented in this thread nor from anything that is readily available from a quick search. It could be of course, but the actual facts that are available don't appear to support such a claim.

He bought it for 1/8th of the price it sold for two years earlier. During those two years, the US economy was on an upswing.

http://www.nytimes.com/1995/12/07/business/40-wall-street-is...

And the building looks like this: https://www.bloomberg.com/graphics/2016-trump-40-wall-street...

It's a shady price, and a shady building, because he now rents it out to crooks like himself. (See Bloomberg piece.)

In the future, do your own research. It's just a Google away.

I bring up your Facebook comment because this is the second time you've come down on the side of the Kremlin and the conman they helped plant in the White House. It's an interesting pattern.

Edit: Responding to your comment below due to limits on nested comments on HN.

40 Wall is a well known center of criminal activity.

"Since Donald Trump took over 40 Wall St. in 1995, prosecutors have filed criminal charges against at least 29 people connected to 12 alleged scams tied to the building. Nine other firms have faced serious regulatory claims. Authorities prevailed in most but not all of the cases."

Trump also housed Trump University there, as well as Trump Mortgage, which shuttered the year before the 2008 crash. Trump paid $25 million to settle charges of fraud against Trump U.

https://www.politico.com/story/2017/03/trump-university-sett...

This isn't the only Trump property associated with large-scale crime. Trump's Taj Mahal casino was fined a record amount in 2015 for violations of anti-money laundering regulations, because it claimed to have lost records of all transactions for years.

http://fortune.com/2015/02/11/trump-taj-mahal-casino-settles...

Trump has effectively led and profited from an international money-laundering syndicate for years. He is the leader of an organized crime family. He became president of the US with the help of dirty money and dirty tricks. Much coming from Russia.

It's very shady looking into anyone's comment history and bring up other supposed dirt and use it like that.

Smear tactic. Now you don't look so good either.

Disagree. There's nothing wrong with looking at somebody else's previous comments, nor anything wrong with pointing out to the reader that there might (rightly or wrongly) be something of interest there. Comments are public, and a user's comment history is public too.

I agree. It's just dumb to bring in irrelevant comments and even dumber to call someone a kremlin troll for defending Facebook.

I would say it's not shady, it's just kinda dumb because it's irrelevant

DELETED based on moderator feedback.

This breaks both the HN guideline against personal attacks ('be civil') and the one against insinuations of astroturfing and shillage without evidence. Someone having an opposing opinion is not evidence. Please don't do this again.

https://news.ycombinator.com/newsguidelines.html

The rest of the internet may be losing its mind; that doesn't mean we need to. Commenters here can do better than this.

Ad hominem attacks do not change the fact that your original point turned out to be false

You are changing the argument. I'm not defending trump and I am not saying he is or isn't a crook. I'm saying your original statement and argument is false.

And yet the comment you just replied to gives evidence that you are the one actually incorrect, as it backs up his original statement and strongly counters your assertion.

To paraphrase for you:

vonnik: $1m purchase price is shady

vasilipupkin: No its not it is the real estate game, unless you can show me $1m in mid 90's is shady for a 71 story office building in premium location on Wall Street

vonnik: OK here is source: http://www.nytimes.com/1995/12/07/business/40-wall-street-is...

vasilipupkin: <comment I am replying to>

My advice is it would help to have evidence, instead of seeding conversations with comments that cast doubt with very little evidence.

I'm not changing the argument. I answered your question precisely, and added new information about criminal activity at the building in question. You have not given a satisfactory explanation of the discrepancy between what the market pays, and what Trump pays. Lacking subpoenas, it's unlikely that we can know what the other side of the trade was. But Mueller's team surely knows. That's why Mueller hired a team of financial crimes experts with Enron experience. They were able to nail Paul Manafort for money laundering, tax evasion and failure to report his status as a foreign agent. Trump is guilt of all that by 100x. The coming months will bring it all out.

Where did you get the number that he paid 1/8th the market price ? You provided zero evidence to this effect. If he did pay 1/8th the market price, I'll concede that something shady was taking place

8 million dollars in 1993. 1 million dollars when Trump purchased it.

1 million / 8 million = 1/8.

your whataboutism is a classic kremlin maneuver. What about this and what about that ? The fact that I defended Facebook's handling of Russian ads in an unrelated online discussion has nothing to do with the fact that your specific argument about details of a specific deal is bullshit.

You said he bought it for 1 million and he bought it for 8. Apparently the same price as previous buyer paid ? So we can dispense with this line of reasoning ?