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Bloomberg: Donald Trump is overstating his wealth by more than $7 billion

Jul 28, 2015, 18:28 IST

Donald Trump.AP/LM Otero

Real-estate magnate Donald Trump frequently touts his wealth on the presidential campaign trail. But a new report essentially accuses him of overstating his own net worth by billions of dollars.

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Bloomberg reporters Caleb Melby and Richard Rubin, citing an analysis by the Bloomberg Billionaires Index, reported Thursday that Trump is actually worth about $2.9 billion.

That's more than $7 billion less than Trump himself claims.

In a statement earlier this month, Trump's campaign wrote that the real-estate developer and television personality has seen his net worth rocket upward over even just the past year.

"Real estate values in New York City, San Francisco, Miami and many other places where he owns property have gone up considerably during this period of time," the Trump campaign said, referencing an earlier $8.7 billion figure from the year before.

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The statement continued: "His debt is a very small percentage of value, and at very low interest rates. As of this date, Mr. Trump's net worth is in excess of TEN BILLION DOLLARS."

One of Trump's leading spokespeople, Michael Cohen, subsequently said that $10 billion was actually a conservative estimate. Cohen, an executive vice president and special counsel to Trump's organization, said in a CNN interview that Trump's empire of golf resorts, luxury hotels, and other properties was on prime real estate and could easily be valued at an even higher price. (Trump has also made money from his Miss Universe Organization beauty pageants, hosting "The Apprentice" and "Celebrity Apprentice," and other high-profile activities.)

"I consider myself to be an expert in real estate. I can tell you that $10 billion number, in my estimation, is low," Cohen said. "Because I know the value of New York City real estate. You're talking about the prime properties. You're talking about Fifth Avenue."

He proceeded to list other locations where Trump owns high-end properties.

"And let's talk about out of New York. On the Pacific Ocean. On the Potomac River. You have 1,000 acres in the middle of Miami, just to name a few. The assets that Donald Trump has - the locations - are second to none," Cohen continued.

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Then-newly-crowned Miss USA Rima Fakih poses in front of Trump Tower after meeting with Donald Trump in his office Thursday, May 20, 2010 in New York.AP Photo/Jason DeCrow

But the Bloomberg Politics report sharply disagreed with that assessment.

For example, the Bloomberg analysis valued Trump's golf and resort properties at a total of $570 million, while it said Trump himself pegged the properties' value at $2 billion "without disclosing his methodology."

In addition to different valuations of Trump's various assets, some of the differences between the $2.9 billion and $10 billion estimates could be attributed to Bloomberg's methodology.

"The Bloomberg index values the real estate based on income it currently produces. Trump's retail spaces could fetch higher rents if vacated and leased to new tenants at prevailing rates," Melby and Rubin wrote. "It doesn't value Trump's brand beyond accounting for cash held in accounts for his licensing deals and business partnerships. Trump's own estimations include much higher values for his brand."

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The Trump campaign declined to comment to Bloomberg but told Business Insider that the candidate would likely be interested in weighing in on the report later in the day.

Click here to read the full Bloomberg Politics article >>

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