Monday, November 10, 2014

Trump Takes Control of Old Post Office

It's actually happening. Donald Trump has announced, in large-lettered billboards (because, of course), his arrival in DC. Trump has occupied what is known as the Old Post Office; one of the tallest, most identifiable buildings on the District skyline. The former government office building will become a hotel after a $200 million, all-over renovation.

At 315 feet, the Old Post Office building has been one of the tallest buildings in the DC area since its completion in 1899. In the District itself, it's the third tallest behind the Washington Monument and the  Basilica. Construction of the Old Post Office began in 1892, seven years before the first law limiting the height of District buildings went into effect. Ironically, it was only a post office until 1914, as it proved too small and inefficient for the purposes of postal work in the early 20th century.

The Trump Organization took control of the building from the federal government in May of 2014. The General Services Administration has initially leased the building to Trump for 60 years. Base rent paid to GSA is $250,000 per month, or $3 million per year, totaling $180 million over the course of the lease. For comparison, the Washington Nationals paid about $5.8 million in rent this year to the District of Columbia with rent increasing on Nationals Park a little less than 2% each year.

Work has already begun to transform the former office building into a 262 room, 2 suite hotel. It will be far from the largest hotel in DC; that's the Marriott Marquis with 1,175 rooms. But, the location on 1100 Pennsylvania Avenue NW and the historic property the hotel will occupy are undeniable assets. The location is about halfway between the White House and the Capitol. When it opens in 2016,  the "Trump International Hotel Washington DC," as it is named, will be the first Trump hotel in the District. The next closest are in New York, Toronto, and Miami. 

Although the balance of the structure will be handed over to Trump for hotel purposes, the National Park Service will retain control of the Tower and Observation Deck as they reopen to the public in spring 2016.