The Trump mansion in Palm Beach, reputed to be the most expensive single family home ever sold in the U.S., has been bought by a fertilizer billionaire?
"Why not?" as one of our most fav real estate investors, who just happened to be the seller, would say.
Fertilizer must be a good business to be in because the buyer, Dmitry Rybolovlev, is #59 on the Forbes Billionaire List.
Okay, so what is so special about 515 N. County Road?
How about 475 feet of unobstructed oceanfront?
Wow. I’ll take that.
Are the real estate investing lessons here for us?
Yes, I think we can learn a lot from The Donald, even if we disagree with him, hate him, or find his hair irritating.
Lesson 1. Buy low, sell high
The Donald only paid $41.35 million for the manse.
He got $95 mil so that makes a profit of roughly about $54 mil if my arithmetic is anywhere near correct, give or take a few mil for rehabbing. (Of course, I’m not figuring in taxes, unfortunately.)
Lesson 2. Use LLC’s
Rybolovlev used an LLC to buy the manse which is only good business for a lot of reasons that we don’t have time to get into now.
But suffice to say, we can see what the big guys do and we can often copy them on a lower level, of course. His business model for buying is a good example.
Lesson 3. The Donald took the time to praise his buyer
I know, I know, going to the bank with that big check makes your day, but there’s something very important going on here.
The Donald always allows his opponents gloat room.
“At the same time, I believe the buyer made an absolutely fantastic deal and time will prove this right,” Trump said.
It’s called credibility.
The Donald doesn’t make fun of his buyers behind their backs or in print. He makes them feel good about their purchases. Who knows, the Donald may be doing business with Rybolovlev again sometime.
After all, he may need to buy fertilizer for his many golf courses or something.
Lesson 4. The Donald has almost superhuman confidence in himself and the real estate markets
Here’s the real take-away for today
I’m so tired of everyone saying what a bad economy this is.
Talking to a 24- year old young man recently who greatly physically resembled Prince William, I was taken back by his fear of the economy.
“Everything getting dangerous out there,” he told me.
“Don’t you remember the early 80’s?” I asked.
He looked blank. And this young man calls himself an entrepreneur.
“Of course, you weren’t born then, but go back and read some of the history. We’ve been through times like this before. We couldn’t even fill our cars up in the mid-70’s,” I told him.
“What?” he looked even blanker.
The Donald is a big student of history as we all should be.
By studying the past we can almost predict the future because everything, especially real estate investing, moves in cycles.
Read Trump sells Palm Beach manse for $95 million
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