The Panamanian government is wading into a dispute between an owners’ association and Trump Hotels following an attempt to dislodge the Trump name from the the Trump International Hotel and Tower Panama.
The issue first took root in January when the property’s owners’ association voted to remove Trump’s management team amid claims of “gross mismanagement, breaches of contract, conversion (or the misuse of property for someone else’s gain) and breaches of fiduciary duties.” Now, Panama’s Public Ministry is looking into whether or not any “punishable conduct” took place at the property, and is requesting more information from both the Trump team and the owners’ association.
Employees of Trump Hotels currently have physical control of the 70-story tower, just as they have since taking over management of the hotel when it opened in 2011. Trump Hotels maintains that it has a valid contract to manage the property, but Orestes Fintiklis, managing partner of Miami-based Ithaca Capital Partners and majority owner of the hotel, wants them out.
While Panama’s federal prosecutors have stepped in to investigate the dispute, it wasn't soon enough to prevent Fintiklis and the hotel’s management team from entering into a game of one-upmanship that saw armed guards called to the hotel, accusations over the improper shredding of documents, disputes over on-property electronic equipment and even offices being barricaded. Fintiklis even publicly complained that he is being unlawfully barred from entering his own property, while Trump Hotels is busy disputing its termination.
The first time Fintiklis tried to take the property back, Marriott International was caught in the crossfire. A team from Marriott was invited to the hotel by its owners’ association, only to have the hotel’s staff show them the door.
Yesterday, Trump Hotels General Counsel Alan Garten released a two-page document accusing Fintiklis of attempting a hostile takeover of the hotel using “a rogue private security team.” Garten’s memo also claims Fintiklis’ push to remove the Trump team from the hotel is in violation of the terms of Ithaca’s purchase of 202 out of 369 hotel units in 2017.
“This dispute should be decided civilly, in arbitration, just as Mr. Fintiklis originally planned, not through intimidation, bullying and the use of force,” Garten wrote. “To be clear, Trump Hotels is highly confident that it will prevail in these proceedings.”
Video obtained by Post of confrontation inside the Trump hotel surveillance room in Panama. pic.twitter.com/BUDkNBMBCc— Joshua Partlow (@partlowj) February 27, 2018
What started out as a spat between owners and their management team escalated last week when Fintiklis arrived at the Trump International Hotel and Tower Panama, notices of termination in hand. The police were called while hotel staff removed themselves to a secure room. Eventually, the owners’ association called to have the power in this room shut off, resulting in the loss of the property’s phone lines and internet connection.
This botched attempt to remove the hotel’s management team prompted Jeff Wagoner, EVP of hotel operations at Trump Hotels, to travel to the property. The hotel also reportedly increased its on-property security. Meanwhile, Fintiklis and Trump Hotels leadership have been speaking to employees, sowing confusion as they assure employees in turn that each entity is in charge of the property.
"I am your employer under the laws of Panama," Fintiklis wrote to hotel employees in a letter on Sunday. "The Trump Organization, to gain financial and strategic advantage against me and the owners I represent, has been lying to you and putting your jobs and the hotel at grave risk."
"To our amazing staff, we thank for your extraordinary dedication,” Garten wrote in his letter yesterday. “Rest assured, we will continue to stand by and support you—just as you have supported us—during this challenging time.”
Ithaca Capital Partners has not yet responded to requests for comment. The owners’ association’s displeasure with the Trump management team is rooted in the hotel’s low occupancy levels, and has ballooned from there.
The Trump Hotels brand currently has 12 properties in its portfolio, including the embattled Panama property. Hotels in Toronto and New York have already voted to remove the Trump name from their façade, but there is some question as to whether or not the Panamanian government will take further action in this feud. Panama is looking to extradite its former president, Ricardo Martinelli, from the U.S. as he faces charges in his home country for espionage and embezzlement, and it’s uncertain if Panama will risk its relationship with the president of the U.S. over a hotel he owns.