CGI Merchant Group’s Raoul Thomas On His American Dream

The son of a World Bank economist, the Jamaica-born Thomas started his career in finance in the mid-1990s before launching CGI Merchant Group in 2005. The company, which has investments in office properties and coworking operations as well, is funded in part by capital from former professional athletes, including the likes of Alex Rodriguez and Wayne Ellington, among others.

CGI’s brand of coworking, Nexus Workspaces, offers short-term executive suites in wealthy suburban markets, with five locations in South Florida and an expansion planned in additional markets. Nexus was one of the earlier arrivals in the niche, too.

In 2020, CGI launched a $650 million hospitality fund in partnership with Hilton, intending to focus on lifestyle and boutique hotels, beginning with the Gabriel South Beach and Gabriel Miami, which CGI brought under the Hilton umbrella.

While it wasn’t the initial plan, CGI took a little detour through D.C. when the opportunity to buy the leasehold for the Trump International Hotel arose and took over Thomas’s life for a year and a half. Not that he’s complaining. (CGI is currently in talks to recapitalize the hotel after defaulting on a $285 million loan on the property.)

An equally — if not more — important hotel project is the planned development of a 150-key hotel on the campus of Morris Brown College, a historically Black college in Atlanta that had lost its accreditation amid financial issues. The project will also include a hospitality management training complex for Morris Brown students, and offer the school a source of revenue. (Morris Brown has since had its accreditation restored for a five-year period.)

Thomas spoke with Commercial Observer in mid-February about his projects in Miami and Atlanta, gaining respect for Donald Trump, the influence of his parents on his work, and the importance of giving back, especially to communities of color.

This interview has been edited for length and clarity. 

Commercial Observer: You’ve lived all over the world. What brought you to Florida?

Raoul Thomas: I came for love. As a child, my father worked for the World Bank — he’s a world-renowned economist — so I traveled the world to different places where my father was stationed as an adviser. I lived in Africa, I lived in Europe, I lived in South America, I lived in the Caribbean. With international schools being my home, I was constantly moving, but I was constantly around adults. And very impressive and very important, intellectual adults.

My father has written most of the monetary policy that covers central banks within the Caribbean, so I had a very big, aspirational role model and shoes to fill. My dad did it in a way where his impact was done through education; I did mine where it’s probably through capitalism. In the earliest stages of where I was going, it was probably contradictory to everything that he stood for, because he came up with more of a socialist policy framework, where the workers were important and with the notion of equal pay — that was where his studies and his work was. I chose to embrace everything great about the United States, but always be social minded.

What does your father say about your work now?

He’s very, very proud. Actually the name CGI is the first letter in each of my kids’ names, and he came up with that.

I’ve been blessed by having tremendous role models in both parents. I lost my mom, who was my angel and she’s still with me, at 63 years old from stomach cancer.

My parents were very opposite profiles. My dad was highly intellectual, highly recognized, and very much committed to his work and the discipline of work. Our dining table was — we couldn’t eat at the dining table because it was always books everywhere and papers. But my mother was just a magnificent, beautiful woman that when she walked in the room, she looked like a queen and turned heads. She had an entrepreneurial spirit, and built what was then probably one of the largest conglomerates that a woman has ever held in Africa.

So they were polar opposites. But they had the perfect blend of an intellect, and a business-minded person. That became my own DNA. So I have the best of both of them in me.

You’re building a hotel on the campus of Morris Brown College, a historically Black school in Atlanta, where you’re partnering with the school to also offer a hospitality curriculum and employment opportunities for alumni. Can you tell me more about that?

Morris Brown College is within the Atlanta University Center campus.

They had a piece of land that was not being monetized, but a very valuable piece of land because it’s like 20 yards across from the Mercedes-Benz Stadium, four blocks away from where the Atlanta Hawks basketball team plays, eight blocks away from where Microsoft is building its east United States headquarters — and it sits perched on this very historical piece of land that when you walk in it you get goosebumps because it’s 100 years old. And it’s one of the only universities that was built and run and taught by African Americans and supported by the churches.

I went into that school and I had them contribute the land to a partnership, and, because of the location, the fact that it’s so commercially viable, we knew we could do a successful hotel, but we didn’t just want to do a successful hotel. We saw elements of where we can help the school.

In tandem with Hilton — I got certain commitments and, I mean, certain contributions — we helped them develop a curriculum for a school of hospitality. And every student that comes out of that program will have the opportunity to be employed by CGI within the hospitality program. The hotel itself will be a learning center and annex with the school, and the students will be able to learn everything practically in a hotel on their campus.

It’s a personal project. It has a long history of historic context in the Black community; that school produced the first Black millionaire in the United States. So there’s so much history here.

In the notion of ESG, I focus on the S, which is making social impact. And where all this stems from is from watching my father use education and use intellect to make an impact monetarily in poor countries. I’m using capital that I’m generating to give back to make a difference in communities where I have investments.

Let’s talk about the Trump hotel. You’ve been active in Florida and Atlanta for a while, so how did it come to be that you got the deal for the Trump International Hotel in D.C.?

When Trump built it, refurbished it, it was the Old Post Office, 100 years old. These things have so much context to me as an individual. That land was once squatted and occupied by Black Americans, even as slaves. They were then displaced. And then they were brought back to build this magnificent structure that sits on Pennsylvania Avenue, at over half a million square feet.

When you walk into that building, it’s a palace. You wonder how 100 years ago technology or engineering existed to conceive this because it’s inconceivable. We know the cost today — it’s $650 million to build that building in replacement costs — but 100 years ago, it’s just unbelievable.

Fast forward to how we got it. The president decided to divest and sell his right to the lease from the General Services Administration because the government controls the land. He was going to sell the lease and hired a broker to do so. And he had a relationship with one of my partners, Alex Rodrigurez, who I have a 20-year relationship with from when he played for the Yankees. Very reluctantly, I said it wasn’t the model for our fund. We wanted to do more lifestyle hotels and smaller bite sizes. But then when I went and I visited — it was hard to resist the belief that we can take it from the Trump International to the Waldorf brand, which it is today.

It took me about 14 months of my life — and it burned through my family because it consumed 24/7 of my time and six to nine months of GSA approval and due diligence and putting together a business plan with Hilton to acquire it. And then we converted it in one month from the Trump International to the Waldorf Astoria because we were planning all along that way and doing the work in conjunction with Hilton for that transition.

So, when you purchased it, the plan was to bring in the Waldorf Astoria brand? 

Yes, Hilton was our partner. We launched our fund in 2021. We have four hotels in there, and we expect to buy another six, and they’re all going to be branded Hilton.

Hilton was the runner-up in 2014, when the GSA awarded this hotel to Trump. And Hilton is based in McLean, Va., which is 35 minutes away from the hotel. The CEO went to school in Washington. …  The Waldorf is an important part of their brand; it’s their No. 1 luxury brand and this hotel, it’s very characteristic of that brand. So we knew that that was the most ideal brand to put in the hotel. But, we were competing with 11 other buyers, and I had probably five or six meetings with the president directly. Even though he had advisers, he ran the negotiation as he does with everything else. And, for me, it was a tremendous learning experience.

Did you read The Art of the Deal before you met with Trump?

Yeah. Before I met him, I got all the tips. I also had the perception that many people have of him from TV, certainly from my perspective. I just need to be honest, that was different from what I saw in person. It was a very impactful moment in my life that I will always remember because I think it was a fortunate one — to get into the mind of somebody that was so successful in real estate and see how he viewed things.

And you can argue politics and whatever, but, if you walk into this building, this is probably one of the most beautiful hotels in the world, certainly in the United States. He used every element of design — and I know his daughter Ivanka played a big part in it — in using what was there because you’re restricted from tearing this down, so you had to work within the elements of what was there. But the elements are beautiful. I mean, the floor-to-ceiling windows in the rooms are 20 feet. The ceiling heights are 25 feet. Every suite is different.

Very few developers can inherit that with the restrictions that you have within the government and convert that into what he did. So a lot of respect was gained.

I have a lot of follow-up questions.

By the way, this all happened with an immigrant of Jamaican descent, who traveled the world. And he bought a hotel from the former president of the United States, and negotiated with him. So, I say to you, this is the greatest country in the world, with all of our challenges. I’ve traveled the world, I’ve been all over the world. And there’s no place that gives opportunity to people like the United States.

And, I have to tell you, I have a very strong conviction that in this phase of my life I will take that message to as many communities of color, impoverished communities, to young people — there’s an avenue beyond sports. I have a lot of professional athletes, some of the most successful professional athletes are investors of mine — but there’s an avenue beyond that. There’s a path through education, commitment and work. But that work ethic has to come with a conviction of a relentlessness that you can achieve anything.

I think I’m an example of that. So I am so grateful to be an American, but I have a responsibility beyond just these buildings to really impart this privilege and blessing.

Trump is facing a $454 million judgment for real estate fraud, and this hotel is one of the assets implicated.  The court ruled that he lied — not about the value of the hotel itself — but that the loans that he got for the hotel were based on false information. Does that change your feelings about him, and your respect for him as a businessman? 

Definitely not.  I don’t know the specifics of what came out with the judgment relative to the hotel, because I haven’t seen it. And when we spoke about my impression, and my experience with him, I spoke about it at a personal level during the transaction. And I stand by that.

And I also want to say, in getting to know him beyond what you see on television, I did my homework, and I would beg to say that from a policy perspective that impacts communities of color and impoverishment — you look at opportunity zones, at criminal justice reform [such as eliminating the three-strikes rule], and you look at historically Black schools, in his third or fourth year [Trump] enacted a 10-year benefit for those schools — those things have had impacts on hundreds of lives of people that look like my sons and myself.

How do you identify? Are you Jamaican, American, Black? All of the above? 

This is where it’s so interesting for me. I really didn’t pick up on skin color until I moved here. I was very blessed. My mom is of Portuguese heritage. Her father was Black, her mother was Portuguese, and I do have a mixture within me but none of that ever came to the surface. I was just a human being. And the principles of what a good human being means were instilled in me from a very early age: empathy, thoughtfulness, kindness, education. Those are the things that I identify with.

I see myself, first of all, as a human being, not necessarily Black or white. That’s one of the advantages that I have, in being comfortable in any setting; I don’t see myself different from the person sitting across the table with me. I sat next to the president of the United States with the confidence to negotiate with him, you know, on five or six different occasions for no less than four hours and cut a deal — and wasn’t intimidated, was excited to meet him.

But, with that, I know I have a responsibility because of my skin color — to do this in my way, in my own little contribution back into Black and brown communities. Because too often I walk into a room, or I go to a meeting, and there’s not enough representation of people like me, and I want to see that increase. That’s only when I became cognizant of it, but it doesn’t dictate or define anything about who I am.

And that’s the blessing in coming from where I came from in the Caribbean. I don’t think African Americans here have that same benefit, because from a very early age they are labeled and defined as Black. My kids see it. My sons are different than I am because they were born and raised here, and I have to be mindful of that. I tried to impart a balance, because they have to be careful, you know, how they drive in the street and how they respond to a police officer.

So I don’t see myself by color, I see myself based on the value of who I am and what people think of me as a human being. But, with the responsibility of knowing that, OK, I happen to be a person of color, what am I gonna do with all these gifts that have been given? It is to go back and try to make an impact in specific communities of color.