In 1975, Trump hears of a casino worker strike at two Hilton hotels. When he learns that those two casino locations account for 40% of Hilton’s global profits, Trump decides to get in the casino business.
In Chapter 8 of The Art of the Deal, Trump waits for the right Atlantic City property to become available. When the market cools in 1980, Trump assembles a complicated deal to get a prime location on the Boardwalk. In covering his downside, every deal for smaller parcels are all contingent on the others. Trump convinces the existing owners that, unlike the previous developers that’d talked with, he alone can make this deal happen.
Location in the works, Trump applies for gambling permits and other regulatory approvals before he even begins to build. He knows the permitting process was difficult and he saw other casinos forced to make expensive changes mid-construction. He doesn’t want to negotiate from a weak position with money already spent.
Instead, Trump creates very detailed building plans to answer every licensing question before spending a dime to build. Trump suggests to the licensing commission that his casino will only happen if the city is prepared to work with him as a partner with a shared interest to get the casino built. He is approved for operation within six months.
Before construction begins, Trump gets a stroke of luck. Holiday Inn offers to partner with him. Their offer is very generous, running the hotel and giving Trump 50% of the hotel’s earnings. Trump just needs to convince Holiday’s board of directors. He invites them to a fake construction scene that he sets up just to impress them. The visual activity is busy and impressive on his Boardwalk property. The board approves the partnership.
- In this chapter, Trump suggests making complicated deals because often you can get a better price.
- He also tells us to be patient to wait for the right deal.
- He shows us how he covers his downside and works hard to improve it. When possible, he’ll take costlier financing options so that his own money isn’t on the line.
- He keeps his options open, and ensures he doesn’t negotiate from a weak position where he has no options.
- He suggests that you hire your competitors’ best employees, pay them better than they were being paid, and build a world-class team.
- And he discusses the importance of a visual message to help persuade people towards your ideas.