Earlier this month US presidential candidate Donald Trump said China was “raping” the US with unfair trade practices, and now it has emerged that the New York real estate tycoon may have a history of hurling accusations at Chinese, including Shui On Land chairman Vincent Lo and New World Development chairman Henry Cheng Kar-shun.
Trump, who made his name by building on his father’s New York property empire, has boasted “I’ve made a tremendous amount of money dealing with China,” and swears that he knows about “winning from China.”
Part of that winning strategy may involve liberal use of litigation, with Shui On’s Lo, who developed the Xintiandi complex in Shanghai, telling the New York Times recently that for Trump, “To file a lawsuit is nothing. It’s just like having lunch.”
Lo’s experience with Trump’s love of litigation comes from, together with Cheng, having been sued by the New York developer after a company involving the three tycoons, but controlled by the Hong Kong shareholders, sold a Manhattan real estate project named Riverside South for $1.76 billion in 2005.
Bailed Out By Chinese, Trump Pushes for More
“I beat China all the time,” declared last year, boasting that, “I own a big chunk of the Bank of America building at 1290 Avenue of the Americas that I got from China in a war.”
That “war” started, however, with a distressed Trump selling off a site that he couldn’t develop to scions of two of Hong Kong’s most successful real estate families.
Caught out when the New York property market slid in the early 1990s, Trump sold Riverside South to a company controlled by Lo and Cheng in 1994 in return for the two Hong Kong developers assuming Trump’s debts and promising him a 30 percent stake in any profits, according to an account in the New York Times.
Cheng, is the eldest son of New World and Chow Tai Fook founder Cheng Yu-Tung, with the elder Cheng estimated to be Hong Kong’s third richest man, with a fortune of $15 billion. Lo, is the younger son of the late founder of developer Great Eagle Holdings, Lo Ying Shek, and has had a long relationship with Shanghai party secretary Han Zheng.
These sons of eastern empire builders were reportedly surprised when, after their company sold the then largely-completed Manhattan development in 2005, Trump slapped Lo and Cheng with the $1 billion suit, claiming “staggering breach” of fiduciary duty. Even before he became famous for his reality TV braggadocio, Trump’s confidence was on display as he insisted that he could have landed an offer well above the property’s $1.76 billion sale price.
Bank of America Buildings as Consolation Prize
Despite his claims of “winning from China,” however, the judge in the case ruled against giving Trump the $1 billion cash, although the billionaire did eventually gain the rights to profits from two projects in New York and San Francisco that Cheng and Lo bought with the proceeds of the Riverside South asset, both of them branded as Bank of America buildings.
This compensation cost Trump more than four years of litigation, however, during which time the man who might soon be the US president accused Lo and Cheng of fraud and tax evasion, among other violations.
And how does Trump feel now? “I have a great relationship with China,” Trump told conservative political site Breitbart earlier this year. Adding that, “I’ll do fine with China—we’ll do much better with China than we do now, and China like us much better than they do now.”