MIAMI — A tower named after US billionaire Donald Trump was the latest victim Friday of the mortgage crisis, with lenders foreclosing on the 200-unit luxury condominium project.
“Trump Hollywood,” an imposing 41-story beachside tower in Hollywood, north of Miami Beach, offered condominiums with prices ranging from one million to seven million dollars, but only 25 of the units sold, realty consultants said.
Units could be purchased with an initial downpayment of 20 percent of a given property’s value and a mortgage on the remainder, but the deep recession and a sharp fall in property values spelled troubled for investors.
“The condo crash was destined to occur because the developers sold too many units to investors who didn’t live in them,” said Lewis Goodkin of Miami-based Goodkin Consulting.
“It created a false demand that drove up prices.”
Property values in Miami have nearly halved, dropping 47 percent since 2006 at the peak of the housing bubble, according to Standard & Poor’s Case-Shiller home price indices.
About 5,000 properties, including homes, condos and commercial properties, are taken over by banks in the Miami and Palm Beach areas each month due to mortgage defaults, according to Condo Vultures, which currently has a database of 236,000 foreclosed units in southern Florida.
Trump, a developer tycoon who stars in his own reality show “The Apprentice,” said this week he is now seriously considering a run as a Republican candidate for the presidency in 2012.