Will 'Apprentice' winner Bill Rancic's Chicago Trump project actually be built?
By Wade Paulsen, 04/20/2004
Was the finale of NBC's The Apprentice little more than a Donald Trump publicity stunt to put pressure on the city of Chicago? Was the most important thing about winner Bill Rancic his hometown rather than his management skills?
At the end of the finale, The Donald gave Windy City native Bill, whom Trump had just "hired" to work for The Trump Organization, a choice between construction jobs in Chicago and Los Angeles. Unsurprisingly, Bill picked the Trump project located in Chicago -- the 90-story Trump International Hotel & Tower on the north bank of the Chicago River, at the current site of the Chicago Sun-Times building (401 N. Wabash). Bill told the Chicago Tribune that having the chance to stay in Chicago made his victory feel like "a double win."
According to the New York Times, the plans for Trump's Chicago outpost have a few things missing ... including the financing and final approval of the project from Chicago City Hall. Right now, whether the project will actually be built appears to be uncertain, and it seems that Trump wanted to use the publicity from his hit TV show to push the Chicago project to three groups: potential investors, potential buyers of condos and Chicago city officials.
Trump told the NY Times, "I felt that this was a great opportunity to promote a great project. If I didn't have Bill to do this, I would have lost that opportunity." This statement suggests that Bill's ties to Chicago were the driving factor behind his triumph over Kwame Jackson in the finale.
Trump is slated to build the tower in a 50-50 collaboration with Hollinger International Inc., the owner of the Chicago Sun-Times, with total costs of the project estimated at $700 million. According to Charlie Reiss, a Trump Organization senior VP featured on The Apprentice, both Trump and Hollinger had contributed about $10 million to the project as of the end of 2003. The 75,000-square foot Sun-Times site itself, which is owned by Hollinger, was valued at $75 million. Plans call for the existing Sun-Times building to be demolished in September 2004, at which time tower construction will begin.
However, after Hollinger majority owner and CEO Conrad Black resigned at the end of 2003 over charges that he had systematically looted the public company of tens of millions of dollars for years (one reason why The Trump Organization will never be a public company if The Donald can help it), Hollinger put most of its assets up for sale. Hollinger had no comment when asked by the NY Times whether it would continue to participate in the Trump Chicago project.
Donald Trump, as expected, dismissed the NY Times' questions about the project's viability. He claimed to have five financial institutions "all of which are dying to do the job." Similarly, Charlie Reiss told National Real Estate Investor that "banks are coming to us" to take over Hollinger's financing role. Nevertheless, Trump's choice of this tower as the highlighted "reward job" for the winner of The Apprentice once again makes the show look like little more than an informercial for The Trump Organization as it looks to nail down a replacement financing deal -- a result with which NBC is apparently comfortable, since the network has committed to two more seasons with The Donald at a huge pay increase.
Trump also dismissed questions about whether he had the city permits needed for the project, telling the NY Times that the project had all of the approvals it needed. Not true, according to city officials, who said the Trump project needs a final administrative sign-off once detailed drawings are submitted and the project team applies for demolition and building permits. We wonder if Bill Rancic has any connections among the decision-makers for these permits ... but we'd bet that Trump already knows the answer to that question.
However, the Trump project does have one major success -- in addition to its prime-time plug from The Donald -- that might cause both investors and the city to look favorably upon it. Trump's director of Chicago sales told the NY Times that buyers have purchased 325 of the tower's planned 461 residential condo units and 128 of the building's 200 hotel condo units (which can be rented out as hotel rooms when not in use by the owner). In addition, she told National Real Estate Investor that four of the tower's five penthouses, which cost up to $11 million, have been sold.
Is Bill Rancic prepared to handle a project of this financing and regulatory complexity? Of course not. As a result, The Donald has refused to say what job Bill will actually have, other than to say that it will be an "important" job. Bill himself told E! Online that "I think I'm going to need some guidance. But I think Mr. Trump has the right people in place. They'll take me under their wing."
So, if Bill thinks that "Mr. Trump" already has the right people in place, what role will Bill have? We think "publicity director" or "spokesman" seems about right. Or, perhaps, "apprentice" -- which means someone who works for an expert to learn a trade, but is a far cry from what would normally be expected of the president of one of Donald Trump's companies.
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