Trump Ocean Club Panama





Trump Ocean Club Panama

developer misses $23 Million bond payment


The developer of a Donald Trump-branded hotel and apartment complex in Panama missed a bond payment 18 months after issuing the notes when it emerged from bankruptcy.

Newland International Properties Corp. wasn’t able to make a $23.4 million principal payment due this week on its $200 million of notes due in 2017, according to a statement on the Panama stock exchange’s website. The real-estate developer said it did pay $9.4 million in interest. It reached an agreement with almost two-thirds of bondholders on Nov. 26 under which the non-payment of principal won’t lead to a violation of an indenture agreement, according to the statement.

Newland emerged from Chapter 11 protection in July 2013 after saying in its bankruptcy filing that the financial crisis had curbed sales at the Trump Ocean Club, a 70-story building on Panama Bay with more than 350 hotel rooms and 500 condos. Under its reorganization plan, holders of defaulted notes due November 2014 were given the new bonds that mature in July 2017.

While court documents show the company isn’t an affiliate of Trump Organization Inc., its website includes an endorsement from Donald Trump and a video tour narrated by his daughter Ivanka.

“We are very proud of being the number one preforming hotel in the city,” Eric Trump, Executive Vice President of Development and Acquisitions at Trump Organization, which manages the project, said in a phone interview from Panama City. “Trump Organization is not affiliated to the developer and has nothing to do with ownership of the project.”

Newland executives didn’t immediately return a call seeking comment.

Fitch Ratings said in an August 2014 statement that the company had to cut prices on its condo units.

“Since restructuring, the company has discounted prices in order to sell individual condo units, and executed two bulk sales at even larger discounts,” Fitch said.

The company’s bonds last traded Dec. 30 for 32 cents on the dollar, according to data compiled by Bloomberg.



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