3 Min Read
TORONTO (Reuters) - The name Trump will be removed from a high-rise hotel and condo development in downtown Toronto after the project's new owner, JCF Capital ULC, reached a deal with Trump Hotels to buy out its management contracts for an undisclosed amount.
U.S. President Donald Trump never owned the project, but his company had signed a long-term branding and management deal with the building's developer, Talon International Development Inc, which defaulted on its construction loan last year.
JCF Capital ULC earlier this year bought units in the 65-story Trump International Hotel & Tower that were not owned by individuals in a court-run sale.
In a statement announcing the buyout on Tuesday, JCF Capital did not say whether it had reached a deal yet with another group to take over the management and branding of the building in Toronto's financial district.
Sources told Reuters earlier in June that Marriott International Inc's (MAR.O) St. Regis brand was the lead bidder to take over the brand and management rights, with one saying that the Trump Organization had agreed to sever its connections.
"We are pleased to have reached this agreement with JCF and have enjoyed our relationship with them as the new owners of this property," Eric Danziger, chief executive of Trump Hotels, said in the JCF statement.
JCF is a vehicle created by Juniper Capital Partners LLC and Cowie Capital Partners Inc to buy the tower.
Trump's business interest will receive at least $6 million for walking away from its long-term contracts, and the Trump signage could be removed as early as Aug. 1, Bloomberg reported, citing a person it did not identify.
The tower, which opened in 2012 after construction delays, has had a troubled history, including lawsuits from unhappy investors and has also been the scene of several protests against President Trump's policies and statements.
His business connections around the world have sparked lawsuits and criticism about potential conflicts of interest since he took office in January.
Since its opening, Talon had sold less than half of the tower's residential condos, and the hotel's occupancy rates have been lower than some investors in the rooms had hoped. A court last year ordered the developer to pay damages to one investor for "negligent misrepresentation" and for another sale to be rescinded.
Reporting by Alastair Sharp; Editing by Dan Grebler and Taylor Harris