Trump may face loss if he sells his Washington D.C. Hotel

President-elect Donald Trump might face a financial loss should he opt to sell his Washington, D.C., hotel now, complicating the possibility of a clean break from the property.

His company's ownership of the hotel has become a flash point for his conflicts of interest around the globe.

As president, Trump would be on both sides of the lease for the 263-room Trump International Hotel Washington D.C., which opened in September in a renovated post office building rented from the federal government. For the Trump Organization to recoup its $212 million investment in the makeover, a buyer would have to pay about $806,100 per room.

It's unclear whether the property could attract a bid that high.

'At 800,000 a room, it would certainly be at the top end of the market for luxury hotel values” in the district, said Andy Wimsatt, a Washington-based managing director in hotel brokerage and investment sales at CBRE Group Inc.

As the hotel has been open for only three months, there's no meaningful income data yet. Its lease prohibits an elected official from benefiting from the deal, but the paths to divestiture aren't straightforward.

'He and his children think of this as the crown jewel of their portfolio, and they would put up with a lot of criticism before selling it at a loss,” said Tom Baker, corporate managing director at commercial broker Savills Studley.

The Trump Organization has said it spent about $212 million - about 80 percent of it borrowed from Deutsche Bank - to redevelop the historic Old Post Office, located a short walk down Pennsylvania Avenue from the White House. Trump's cost was 51 percent higher than that of a plan submitted by a group including Hilton Worldwide Holdings Inc., which called Trump's revenue projections 'unrealistic” in a 2012 protest.

Patricia Tang, Trump International Hotel director of sales and marketing, declined to comment. The president-elect's transition team didn't respond to an email seeking comment.

Luxury hotels in Washington have been attracting strong buyer interest. At least four sold during the past 18 months, fetching between $451,200 a room and a record $1.3 million a room, according to brokers. Three of the sales were in the posh Georgetown neighborhood, including the Four Seasons for about $1 million a room and the Ritz-Carlton for about $581,400 per room.

Trump pays $3 million a year in base rent for a 60-year ground lease with the federal General Services Administration, with two renewal options for 20 years each. Many buyers are put off by ground leases, whose terms vary widely, so leasehold properties tend to sell at discounts.

The valuation of the property also 'would be dictated by the prominent landmark status of the building and the appeal of buying an asset from a sitting president,” Baker said. 'If the price were well above market, then you would have to question the motives of the buyer.” 'All of the possible solutions are sticky,” said Matt Schoonover, a lawyer at Koprince Law, which focuses on federal government procurement. 'There's not really a clean way out of this for anybody.”