Fred Trump completes Beach Haven with mob help, makes his kids landlords

Sometime in 1950, Fred Trump completes the Beach Haven apartment complexes with $16 million in Federal Housing Administration (FHA) funds. From the FHA aid for Beach Haven and Shore Haven, Trump and his business partner schemed the government out of at least $3.5 million that went into their own pockets.

When he got the green light for another development — Beach Haven, a forty-acre, twenty-three-building complex in Coney Island that would net him $16 million in FHA funding — it was clear that his strategy of building on the taxpayer’s dime was a winner.
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By now, it is believed that Trump is working discreetly with the Italian mob. He’d previously worked with James Tomasello, a bricklayer contractor with a complex web of connections to the mob and a source of capital for Trump. His partner on Beach Haven is James’s son, William “Willie” Tomasello, whose own mob ties include earlier real estate projects with members of the Gambino and Genovese crime families in New York and Florida.

Before building the apartments, Trump bought the land and gave it to a trust. He made his five kids, including three-year-old Donald Trump, beneficiaries of that trust. Since Beach Haven is built on the land, the building has to pay a ground lease to the trust, i.e. the Trump kids. Fred arranged a 99-year lease in which the Beach Haven building has to pay his kids $60,600 every year.

In effect, he made his children into landlords… The maneuver created a steady stream of income for the Trump children for their entire lives. Fred Trump later set up similar ground leases at the nearby Shore Haven apartments. The lease continued until the properties were sold 55 years later, paying Donald Trump the equivalent today of more than $4.8 million.
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Beach Haven becomes home to numerous Russian and Ukrainian immigrants.

Note: The publicly available information on James and Willie Tomasello confirm their mob ties, but Trump File is not 100% confident in the elder Tomasello’s relationship with Fred Trump. The relationship between Fred and Willie is better documented.