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Donald Trump is racing to stave off a pair of civil penalties totaling nearly $540 million — without having to first put up the full amounts in cash or bonds.
The former president’s lawyers claim that he would face “irreparable” harm if required to fully secure his judgments in order to keep them from coming due, and might even have to quickly sell off properties that can’t be re-bought.
They also say Trump can’t simply post a cash deposit — at least not in his New York civil business fraud case, where he is facing $454 million in fines and interest alone.
“No one, including Jeff Bezos, Elon Musk and Donald Trump, has five hundred million laying around,” Trump’s attorney Chris Kise told an appeals court judge last week.
But legal experts say there’s another option that Trump’s lawyers haven’t mentioned in the court filings: Trump could offer up some of his properties as collateral to borrow what he needs — potentially from private equity sources.
There are “lots of private lenders out there in the debt markets and private equity markets that could lend” to Trump, said Columbia University law professor Eric Talley.
“In all cases, the loans would probably have to be secured with Trump properties, but if there is enough equity in some of them, he should be able to obtain secured credit, even on a compressed timeline,” Talley said.
The professor underscored the irony of Trump using his real estate to fight a lawsuit in which he was found liable for fraudulently inflating his property values for financial gain.
Any loans “would themselves involve making declarations of the value of the property — and that of course is what got him into this mess to begin with,” said Talley.
But accurately appraising the value of Trump’s assets is not a serious obstacle. As Trump’s lawyers noted during the fraud trial, the institutions that have lent him money already have conducted their own analyses of Trump’s finances, and did not rely solely on the claims at issue in his financial statements.
A more important factor could be whether Trump’s real estate assets are already mortgaged, said law professor John Coffee.
“He would have to come up with clean real estate property that is not already securing something that some other bank has a lien on,” Coffee said.
“Does he have that property? I can’t tell you.”
What Trump owns
As of late January, the Trump Organization comprised 415 entities, according to a retired federal judge tasked with monitoring the company’s finances.
Of those, Jones identified 70 operating entities that generate revenue. That includes long term leases of buildings like 40 Wall Street, commercial office space on 13 floors of the 58 story Trump Tower, and the Trump National Doral Miami resort.
In New York City, the value of Trump’s real estate holdings totals $690 million, according to a September 2023 estimate by Forbes. And some of the most prominent buildings that bear Trump’s name in the city are largely owned by other entities.
New York Attorney General Letitia James, who brought the fraud case, said she would seize Trump’s real estate assets if he cannot pay his civil penalty.
“There’s absolutely no reason for the New York attorney general to be kind and gentle to him if he doesn’t post the bond,” Coffee said.
Trump said in a deposition last year that he had “substantially in excess of $400 million in cash.” But his lawyers claimed last week that, if Trump is forced to secure the full $454 million penalty, “properties would likely need to be sold to raise capital under exigent circumstances.”
They instead offered to post a $100 million bond, but New York appeals court Judge Anil Singh rejected the proposal.
Unless a full appeals court reverses Singh’s decision, Trump has until March 25 to post an “undertaking” — cash or bonds — covering the entire penalty in order to stop it from taking effect during his appeal.
Trump has also asked a federal judge to delay another fast-approaching deadline to pay an $83.3 million penalty in E. Jean Carroll’s civil defamation case.
Carroll’s attorneys argued that Trump’s request “boils down to nothing more than ’trust me.'”
Trump’s next move
If Trump does attempt to sell assets to meet his undertaking, he won’t have much time to get it done.
He would have to hire a broker to market his properties, and any deal would have to close in order to free up the cash to use toward a bond, said Neil Pedersen, owner of New York-based bond agency Pedersen & Sons.
“There could be opportunistic buyers approaching him as well,” Pedersen noted.
So far, Trump has given no indication that he is moving in that direction.
“There are no sales planned or contemplated,” Trump attorney Chris Kise told CNBC in an email before Singh’s ruling. “So no appraisers hired, no steps taken, etc.”
After Singh ordered Trump to pay the full penalty, Kise and Trump’s other attorneys did not reply to questions about whether they were now preparing to sell off properties.
Coffee said that Trump “can very likely” get a loan to help him meet his undertaking. That’s in part because Singh temporarily halted another penalty that would bar Trump from applying for loans from New York registered lenders.
Moreover, said Coffee, Trump is well known within New York financial circles, so he “not going into a market with strangers.”
“The real problem is, can he gives the banks enough collateral that they’re satisfied?”
Talley agreed. “There is a lot of ‘dry powder’ out there, not just with banks but also in non-banks,” he said.