Latest / Real Donald Trump Wisdom / The Art of the Deal - Chapter 2: Trump Cards - Elements of the Deal - Enhance Your Location (1987)

Transcript

The Art of the Deal - Chapter 2: Trump Cards - Elements of the Deal - Enhance Your Location (1987) · Real Donald Trump Wisdom

• 0:00
  Hey guys, back for another episode. Trump, the
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  art of the deal, elements of the deal. Enhance
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  your location, Trump says. Perhaps the most misunderstood
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  concept in all of real estate is that the key
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  to success is location, location, location. Usually
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  that's said by people who don't know what they're
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  talking about. First of all, you don't necessarily
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  need the best location. What you need is the
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  best deal. Just as you can create leverage, you
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  can enhance a location through promotion and
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  through psychology. I was going to give an example
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  of how he did just that. When you have 57th Street
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  and 5th Avenue as your location, as I did with
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  Trump Tower, you need less promotion. But even
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  there, I took it a step further by promoting
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  Trump Tower as something almost larger than life.
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  Location also has a lot to do with fashion. We
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  can take a mediocre location and turn it into
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  something considerably better just by attracting
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  the right people. After Trump Tower, I built
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  Trump Plaza on a site at 3rd Avenue and 61st
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  Street, and I was able to purchase very inexpensively.
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  The truth is that 3rd Avenue simply didn't compare.
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  with Fifth Avenue as a location. But Trump Tower
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  had given a value to the Trump name and had built
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  a very striking building on Third Avenue. Suddenly,
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  we were able to command premium prices from very
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  wealthy and successful people who might have
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  chosen Trump Tower if the best apartments hadn't
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  been sold out. Today, Third Avenue is a very
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  prestigious place to live. Trump Plaza is a great
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  success. Trump is saying here that the name that
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  he created out of Trump Tower allowed him to
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  raise or to command premium prices at other locations
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  thanks to the brand. So he's saying that regardless
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  of the location, if you know how to brand it
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  properly, you can command a value premium. Now
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  he's going to explicit this point. He says, my
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  point is that the real money isn't made in real
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  estate by spending the top dollar to buy the
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  best location. You can get killed doing that,
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  just as you can get killed buying a bad location.
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  even for a low price. What you should never do
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  is pay too much, even if that means walking away
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  from a very good site, which is all a more sophisticated
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  way of looking at location. So the gist of it
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  is that in any real estate transaction, you want
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  to make sure that the price isn't too high. Like
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  there's always a price at which the deal is not
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  worth pursuing, even if it's the best location.
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  And on the flip side, If the price is right and
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  the location is not necessarily the best one,
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  it can turn out to be a successful deal as Trump
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  managed to do with Trump Plaza on 61st and 3rd.
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  So here are the advices to not fall into the
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  dogma of location, location, location, and rather
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  look for value. or as he says in this subtitle,
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  enhance your location.