Trump’s company launches new hotel chain
US President Donald Trump’s sons say their company is launching a new hotel chain inspired by their travels with their father’s campaign.
The Trump Organisation is calling the new mid-market chain “American Idea” and says it will start with three hotels in Mississippi.
At a party at Manhattan’s Trump Tower, Donald Trump Jr said he and his brother, Eric, got a “crash course in America” while travelling across the nation with their father’s presidential campaign: “We saw so many places and towns and so many stories.”
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The first of dozens of hotels in another new Trump chain called “Scion” is also under construction in Mississippi.
Scion is a four-star hotel chain meant to offer upscale service in US cities that could not support a fully fledged Trump luxury property. Ethics experts have said the chain raises conflicts-of-interest issues for the White House.
We kind of look at it as flea-market chic
The four Mississippi hotels for both chains will be owned by Chawla Hotels. The Trump Organisation will get management and franchise fees for the new ventures. Chawla Hotels owns 17 hotels under various franchise names.
Chawla Hotels was founded by the late VK Chawla, who was described as a war refugee from India. His son, Dinesh Chawla, says his father came to the US as a legal immigrant from Canada.
Eric Trump, centre, with Trump Hotels CEO Eric Danziger and Donald Trump Jr.
“I am an immigrant, and I have sympathy for people who are refugees,” says Dinesh Chawla, chief executive of Chawla Hotels. “I do believe in legal immigration.”
The Scion hotel will be built from the ground up in Cleveland, Mississippi, in the Delta region that has a substantial blues music tourism industry. It will cost $US20 million ($26.7 million), with financing from Guaranty Bank, a local bank, Chawla says.
The three American Idea hotels will also be in the Delta, one each in Cleveland, Clarksdale and Greenville. Chawla says his company will renovate existing hotels and each renovation will cost up to $US1.5 million. He says the renovations could take up to eight months.
“They’re cashing in on the red states,” says Kathleen Clark, a government ethics expert and law professor at Washington University in St Louis. “I’m not surprised that the Trump family would look to opportunities to commercially exploit his political success.”
Government ethics experts worry that developers seeking to curry favour with the President will be eager to help him in his new chains. They say their investments could work just like campaign contributions, but without any limits on spending and disclosure requirements.
Trump Hotels chief executive Eric Danziger has expressed confidence that his company can avoid any ethical trouble. He has said any deals go through an “exhaustive, thorough” review.
Before Trump took the oath of office, he announced a series of steps to allay concerns that his sprawling business holdings could lead to conflicts between doing right by the country and his own financial interests.
Danziger says the American Idea brand will seek to capture the history and heritage of small towns by using local artefacts and materials. He threw out the idea of using things from towns to give hotels a local feel, like a vintage fire truck.
“It’s about small-town America,” Danziger says. “We kind of look at it as flea-market chic.”
This article originally appeared on www.theaustralian.com.au/property.
