The Trump Organization said on Thursday it had rejected a proposed Dallas hotel project with a real estate firm that had attracted scrutiny for its vast foreign ties to Russia, Kazakhstan and at least two dozen other countries.
The firm, Alterra Worldwide, was the only publicly identified potential partner in the Trump Organization’s domestic hotel expansion plans. Alterra’s president, Mukemmel Sarimsakci, who was born in Turkey and calls himself the “Turkish Trump,” planned to buy property in downtown Dallas on which the hotel was to be built.
The Trump Organization said that in addition to having questions about the firm’s sprawling foreign ties, it objected to Mr. Sarimsakci’s prematurely publicizing the hotel plans in the news media when there was no final agreement.
“We clearly retreated from this particular deal,” Eric Danziger, the head of the Trump Organization’s hotel division, said on Thursday.
Of Mr. Sarimsakci, who did not respond to requests for comment, Mr. Danziger said, “we wish him well.”
The Dallas Morning News reported on Wednesday that Mr. Sarimsakci had told Dallas officials he was abandoning the deal because of local resistance to a project involving the Trumps. Mr. Danziger disputed that Mr. Sarimsakci was the one to walk away from the project and said that the Trump Organization was pursuing six other hotel projects in the Dallas region that did not involve Alterra.
The unraveling of the proposed Alterra deal demonstrates the complexities facing the Trump Organization as it seeks to expand the reach of the family business while its founder occupies the White House. The process of choosing suitable business partners is saddled with political and ethical considerations, including the possibility of foreign entanglements and conflicts of interest.
The New York Times reported last month that private emails, archived websites and other records showed that Alterra Worldwide had extensive international ties that had caused some concern among Trump Organization lawyers. Mr. Sarimsakci originally said he would fund the Dallas project with money from Turkey and Kazakhstan, among other places.
The Times also reported that Mr. Sarimsakci’s brother and business partner, Yusuf Sarimsakci, had helped oversee the development of the Ritz-Carlton in Moscow near the Kremlin, and had worked with an array of companies shrouded in corporate secrecy and based in tax havens like the British Virgin Islands. Yusuf Sarimsakci was not accused of any wrongdoing.
Last year, the Trump Organization, now largely run by President Trump’s eldest sons, Eric and Donald Jr., began pursuing a deal with Alterra and seeking agreements with dozens of other partners across the country for its new Scion hotel brand, a less-expensive alternative to its five-star line.
The potential pairing with Alterra became an early test of the Trump Organization’s process for approving deals while Mr. Trump is in the White House.
To manage ethical concerns, the company has hired an outside adviser to review potential agreements. and has also vowed to forgo new deals abroad to limit possible conflicts of interest.
If the company had moved ahead with an Alterra partnership, however, it was poised to essentially import those international connections. The ethics adviser, Bobby Burchfield, raised questions about the potential sources of financing and about Yusuf Sarimsakci’s ties to Russia, according to a person briefed on the process, who spoke on the condition of anonymity to discuss private deliberations.
In response, Mukemmel Sarimsakci said that his brother would not be involved in the hotel project and that the money for it would come primarily from domestic sources. But before those claims could be verified, Trump Organization executives decided not to move ahead with an agreement.
The decision came down to a number of factors, according to Mr. Danziger, who said that the company’s other potential deals in the Dallas area were more attractive. He took particular issue with Mr. Sarimsakci’s decision to publicly promote his possible partnership with the Trumps.
The other potential Scion deals being considered in the Dallas region, Mr. Danziger said, would “undergo the same rigorous process for approval.”
The potential Alterra partnership was one of many Scion deals in the works for the Trump Organization. The Trumps plan to manage the properties while their partners own and develop them.
Mr. Danziger said last month that the Trump Organization had signed at least 30 letters of intent with developers, including Alterra, but that none of the deals had been finalized. He singled out the Dallas market as a particularly good fit for the Scion brand.
But he cautioned that up to half the deals might not come to fruition.
The company’s experience with Alterra highlights the way that some cities may not be particularly welcoming to the Trumps’ business plans. Before it ever got off the ground, the Scion venture in Dallas was met by protesters and by reluctance on the part of some city officials, including Philip Kingston, a Democratic member of the City Council. Mr. Kingston said he had advised Mr. Sarimsakci, “The president is a bad brand.”
According to Mr. Kingston, Mr. Sarimsakci told him and another council member opposed to the Trump Organization’s interest in Dallas that Alterra had split with the Trumps because of local opposition. Mr. Kingston said that Mr. Sarimsakci planned to move ahead with a different hotel operator.