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The Art of the Deal by Donald J. Trump.
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In the 1980s, Donald Trump was among the most well-known real estate moguls in New York City. A born-and-raised New Yorker, Trump went from building subsidized housing with his father in Queens and Brooklyn to constructing multimillion-dollar luxury apartments in Manhattan.

The Art of the Deal is Trump’s autobiography of his early life and career. Trump writes about the family and childhood that formed him, the professional experiences that taught him, and the deals that made him notorious.

Trump’s Family and Formative Years

Trump was aggressive from a young age; when he began creating trouble as a teenager, his father sent him to the New York Military Academy. There, Trump learned the discipline to channel his aggression into work.

Whenever Trump was home during school breaks, he worked with his father, who had a business building and managing low- and middle-income housing. Trump’s father, Fred Trump, was tough, driven, and a shrewd businessman. Donald learned from watching his father’s tactics:

  • Fred demanded contractors work quickly and produce quality work.
  • Fred pushed contractors to work for lower rates for the promise of steady work and reliable pay.
  • Fred refused to let anyone overcharge him because he knew what every supply and service cost.

Fred had a successful business, but he had to work hard and keep costs down in order to make a profit. Donald would follow his father’s example, but he had his sights on luxury buildings and bigger profits.

After high school, Donald enrolled in Fordham University and later transferred to Pennsylvania’s Wharton School of Finance, where he earned his degree. After graduating from college, Donald joined Fred’s business full time.

Guiding Business Principles

Trump lists 11 principles that have guided him through his business decisions, and you see them manifest in many of the stories in the book. (Shortform note: In addition, we’ve included a few more principles that are recurring themes in the stories of his deals.)

  1. Aim High: Dream big and don’t be afraid of making lofty goals. In order to think—and achieve—big, you need total focus.
  2. Prepare for the Worst: No matter how good it seems, any deal can fall through. If you act conservatively and prepare for the worst-case scenario, you’ll protect yourself against loss or failure.
  3. Have a Backup Plan: Even if a deal doesn’t fall through, conditions can change. Have a plan B, plan C, and even plan D—and be flexible and agile enough to pivot to any of them.
  4. Know Your Target Audience: Whenever you create or market anything, know who you’re targeting, what they want, and how they think.
  5. Have a Bargaining Chip: Figure out something you can leverage to put yourself in a position of strength in any deal. Sometimes that entails reframing a deal to make it seem like you’re doing the other person a favor.
  6. Buy Good and Make It Better: Instead of spending top dollar on high quality, be shrewd and look out for low costs and high potential. If you see the potential, you can make it more appealing through strategic marketing, and this will increase its value.
  7. Promote: It doesn’t matter how good your product is if no one knows about it, so promote with enthusiasm and bravado. Even bad press can be leveraged into valuable attention.
  8. Fight If You Think You’re Right: If you stand up for what you believe in—even if it means offending some people—you give yourself a chance of winning. And if you lose, you can feel confident you did all you could.
  9. Have a Good Product: All the promotion in the world will eventually fall flat if you don’t have a high-quality product to hold it up. A strong product is the difference between appealing marketing and real success.
  10. Keep Costs Low: Spend money when it adds value, but don’t spend more than you have to. Even small cost savings can add up.
  11. Enjoy the Ride: Money motivates, but if you’re not enjoying what you’re doing, why do it?
  12. Their Loss Is Your Win: Capitalize on bad situations. When other people face challenges, it can create leverage to help you get a great deal.
  13. Appearances Matter: Don’t underestimate the power of a polished presentation, and don’t overlook the details.
  14. Know When to Fold: Sometimes the best business decision is to sell or opt out of a deal.

We’ll see these principles play out in the following stories.

Trump’s First Deal: Cincinnati Apartments

Trump was still in college when he made his first big deal: An apartment complex called Swifton Village in Cincinnati. Trump bought Swifton with his father, and they scored a great deal because Swifton was foreclosed, two-thirds of the apartments were vacant, and the property was in deteriorating condition.

They discovered that tenants were damaging the property and sometimes refusing to pay rent. The Trumps determined that raising rents would bring in more desirable tenants and reduce problems, so they spent about $800,000 on improvements, including:

  • Adding window shutters
  • Replacing aluminum apartment front doors with white colonial doors
  • Painting the hallways

Although many improvements were fairly minor, they had a big impact on the look and feel of the complex. By the following year, Swifton had no vacancies.

Selling Swifton

After several years, Trump heard that the area around Swifton Village was getting dangerous. Seeing a downward trend, Trump decided to sell.

The Trumps made a deal with Prudent Real Estate Investment Trust. They added two unusual clauses to the contract so that Prudent couldn’t walk away from the deal or lower the agreed-upon price. By the end, Prudent bought Swifton for $12 million—$6 million more than the Trumps paid for it.

Trump’s First NYC Deal: 34th Street Convention Center

Trump’s first deal in New York City was 100 acres of riverfront land in Manhattan.

**Real...

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The Art of the Deal Summary The Art of the Deal Guide Chapter 1: Each Day Is Full and Flexible

To open the book, Trump gives a rundown of his activities every day for a week—from nearly daily conversations with his investment banker to phone calls with Calvin Klein and Don Imus.

Here are some of the key takeaways.

First, Trump keeps his schedule fairly open and flexible to leave room for impromptu meetings. Too much structure hinders your creativity and openness to opportunities that arise. In the week Trump outlines, this approach allows him to tour a prospective school for his young daughter, take a friend’s call about a potential business opportunity, and even take a visit from David Letterman for a Late Show segment.

Second, Trump makesdozensof phone calls each day—often more than 100—and they typically spill over into nights and weekends. Many calls are with his investment banker, his contractors, and his attorney about various deals. Additionally, some calls are more about making contact, staying in touch, and...

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The Art of the Deal Summary The Art of the Deal Guide Chapter 2: Guiding Business Principles

Trump loves making deals. Profits motivate him, but the challenge and fun of deal-making drive him even more.

According to Trump, you need four things to be a successful deal maker:

  • Intelligence
  • Good instincts
  • Good luck to have the opportunity to make a deal
  • Courage to take that opportunity, make the deal, and discover you’re good at it

Beyond his natural aptitude, 11 principles have guided Trump through his business decisions. He outlines them in this chapter, and you’ll see them appear again and again in the stories that follow.

Principle #1: Aim High

Dream big. Many people limit their goals because they’re afraid of making big decisions and, ultimately, afraid of success. (Shortform note: Trump doesn’t elaborate on what scares people about success.)

While his father built low- and middle-income housing in Brooklyn and Queens, Trump always had his sights set on more glamorous and profitable buildings in Manhattan.

In order to think—and achieve—big, you need total focus. Many successful business people possess a “controlled neurosis,” an obsessive drive and single-mindedness that they channel into their work....

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Shortform Exercise: Apply Trump’s Principles

Trump’s business principles can help you navigate negotiations at work and in everyday life.


Which of these principles do you want to practice or improve on?

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The Art of the Deal Summary The Art of the Deal Guide Chapter 3: Trump’s Formative Years

Trump is a born-and-raised New Yorker. He and his four siblings grew up comfortably, but their parents always instilled in them the value of hard work.

Trump Growing Up

Trump was aggressive from a young age; he even gave his teacher a black eye in second grade because he didn’t think the teacher was qualified.

As Trump got older, he started creating trouble, so at the age of 13, his father sent him to military school. The New York Military Academy instilled the discipline that taught Trump to funnel his aggression into work.

Trump became captain of the cadets his senior year, and he was also captain of the baseball team. His baseball coach, a teacher and former Marine drill sergeant, was an imposing man who had a big impact on Trump. This teacher was physically and emotionally tough and intimidated most people—not unlike Trump’s father—but Trump forged a relationship with him by showing respect for the teacher as well as confidence in himself.

Although he didn’t care much about schoolwork, academics came fairly easily to Trump. He enrolled at Fordham University, but after two years transferred to the University of Pennsylvania’s Wharton School of Finance....

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The Art of the Deal Summary The Art of the Deal Guide Chapter 4: Trump’s First Deal—Cincinnati Apartments

Trump was still in college when he made his first big deal: An apartment complex called Swifton Village in Cincinnati. He bought the site with his father and learned lessons that he’d carry into future projects.

Their Loss Is Your Win: Trump Bought Foreclosed Buildings

During college, Trump regularly scanned the listings of foreclosed Federal Housing Administration (FHA)-financed housing projects. Browsing foreclosures is the epitome of gaining from someone else’s loss: Once banks foreclose on a property, they typically want to get it off their hands as quickly as possible, which gives buyers leverage to swoop in and get a good price.

In the case of Swifton Village, two-thirds of the apartments were vacant and the development was in such bad shape that Trump and his father had no competing bidders. They ultimately bought the apartments for $6 million—less than half of what the developers paid to build them a few years prior—and secured a mortgage that covered the $6 million plus $100,000 for improvements.

They didn’t have to put any of their own money in, and once they got things up and running, rents would cover their mortgage.

Know Your Target Audience:...

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The Art of the Deal Summary The Art of the Deal Guide Chapter 5: Trump’s First NYC Deal—34th Street Convention Center

Trump always aimed to work on projects in Manhattan, but in the early years of his career, he couldn’t afford any properties that he felt were worth their prices. Until he could do business in Manhattan, he decided he could at least live there, so he got a small apartment on the Upper East Side.

Coming home to Manhattan every day—though he was still working in Brooklyn—gave him a new perspective and different access to Manhattan life and business. Through persistence, he became a member of Le Club, an exclusive club whose membership included many successful business people. Trump considered his outings at Le Club both social and professional, as he rubbed elbows with people he’d later do business with.

Trump soon went after his first deal in Manhattan—and it was a massive one.

Their Loss Is Your Win: Trump Bought in a Down Market

In 1973, New York City’s real estate development began to drop off dramatically for several reasons:

  • The city’s debt was so high that people started fearing the city would go bankrupt.
  • The federal government stopped giving out housing subsidies, which had been a big source of building funding in New York.
  • Interest rates rose...

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The Art of the Deal Summary The Art of the Deal Guide Chapter 6: Remaking a Classic—The Commodore Hotel

Through Trump’s relationship with Palmieri, he found out about another project: the Commodore Hotel, at 42nd Street and Park Avenue.

For years, the hotel’s books had been in the red and it had defaulted on its property taxes. Additionally, the building and area around it were dilapidated, with many nearby buildings in foreclosure. All of this created a prime opportunity to get a great price.

At the same time, the hotel’s location next to Grand Central Station assured Trump that the value would only rise. A steady stream of professionals passed by the hotel every day, creating plenty of opportunity for business. It was a case of buying good and making it better: If Trump could give the hotel a facelift, the location would ensure success.

Prepare for the Worst: Trump Assembled Several Pieces for the Deal

Despite the premium location, Trump recognized that the project carried a lot of risk with the city still on the verge of bankruptcy. If he fell short, he could lose a lot of time, money, and credibility within the real estate community.

Trump’s deal with Penn Central gave him an exclusive purchase option contingent on him paying $250,000 and securing financing,...

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Shortform Exercise: Have a Bargaining Chip

Knowing how to leverage a situation will help you get what you want in negotiations.


Describe a recent negotiation in which you were in the weaker negotiating position.

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The Art of the Deal Summary The Art of the Deal Guide Chapter 7: A Juggling Act—Trump Tower

In the midst of his campaign to build a convention center at 34th Street and his project to transform the Commodore into the Grand Hyatt, Trump took on one of his most notable projects: Trump Tower.

Since his move to Manhattan, he’d eyed a building at 57th Street and Fifth Avenue where the luxury department store Bonwit Teller was located. It was a large parcel in a great location, and Trump considered it the best real estate in New York City.

Their Loss Is Your Win: Trump Had Persistence and Patience

With no completed development credits to his name, Trump met with Franklin Jarman, the head of Genesco, which owned Bonwit Teller. Jarman heard Trump out but firmly refused to make a deal.

Trump kept in touch. He wrote a letter thanking Jarman for meeting with him, and another a few months later reiterating his proposal. Trump kept writing letters regularly, though Jarman never relented.

However, a few years later, Genesco faced financial issues and replaced Jarman with a man named Jack Hanigan, who was tasked with saving the company from bankruptcy. Trump called Hanigan as soon as he’d learned of the change, and Hanigan agreed to a meeting.

Prepare for...

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The Art of the Deal Summary The Art of the Deal Guide Chapter 8: Trump’s First Casino—Trump Plaza

Trump realized that no success he could achieve in hotels would compare with the profits a casino could bring in. So he visited Atlantic City.

At the time, New Jersey was preparing to vote on whether to legalize gaming in Atlantic City. Before the initiative had even passed, Atlantic City real estate values shot up.

Prepare for the Worst: Trump Didn’t Bet on an Unsure Thing

Trump wasn’t willing to risk buying property in Atlantic City while the prices were hot and legalized gambling wasn’t a sure thing. If the gaming initiative failed, he’d lose his entire investment.

If the initiative did pass, Trump preferred to pay more with that certainty—and he figured the cost would still be a drop in the bucket compared to his inevitable casino profits.

The referendum ultimately passed, but prices rose so high that Trump decided to continue holding out for a good deal. After about three years, he heard about a Boardwalk property that might be for sale.

Their Loss is Your Win: Trump Bought a Challenging Property During Hard Times

By the time Trump considered buying, several factors caused the casino construction rush to cool off:

  • Other casino projects had...

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Shortform Exercise: Prepare for the Worst

Learn from others’ mistakes and act cautiously to avoid losing big.


Describe the last situation or project where you didn’t prepare for the worst and ended up losing time, money, or progress.

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The Art of the Deal Summary The Art of the Deal Guide Chapter 9: Trump’s Second Casino—Trump Castle

With one Atlantic City venture under his belt, Trump considered buying Hilton’s Atlantic City casino-hotel.

Prepare for the Worst: Hilton Made Fatal Mistakes

The Hilton company had made some poor business decisions in the previous few decades, and it was losing its lead against competing hotel chains. Hilton bought two casinos in Nevada to give the company a boost—and it worked, so Hilton considered a casino-hotel in Atlantic City.

Hilton pulled out all the stops for this facility, with a huge site and ambitious construction plans. In its zeal to open for business in Atlantic City, Hilton filed for its gaming license and started building at the same time, but made several critical mistakes:

  • Hilton hired a lawyer when word got out that its application might be rejected, but there’s speculation that the proactive step didn’t sit well with the gaming commission.
  • Hilton kept its lawyer on...

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The Art of the Deal Summary The Art of the Deal Guide Chapter 10: Fierce Opposition Forces an Alternative Plan—Central Park South

In 1981, Trump had the chance to buy two adjoining buildings on the southern tip of Central Park, a few blocks from Carnegie Hall and Columbus Circle. The buildings were:

  1. 100 Central Park South, a 14-story rent-controlled and rent-stabilized apartment building, which hardly earned enough to break even on operating costs
  2. Barbizon-Plaza, a 39-story mid-priced hotel that brought in moderate profits

Despite the premium location, Trump was able to negotiate a good price because:

  • The buildings both earned just modest profits and needed improvements
  • Trump had no competing bidders because the buildings hadn’t been listed on the open market yet
  • Money wasn’t the owners’ main motivation for selling

Have a Backup Plan: Trump Entered the Project with a Few Options in Mind

After he bought the properties, Trump had a few options for what he could do with the properties.

First, despite how little the buildings were earning, Trump was confident the location was so desirable that he could turn around and sell the properties for a profit even if he didn’t build anything.

Second, **Trump could do relatively minor renovations on the Barbizon-Plaza hotel,...

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Shortform Exercise: Be Flexible

You can keep your project alive by knowing when to fold on your current plan and having a backup plan.


Describe the last time you hit a roadblock in a project that prevented you from carrying out your original plan. What did you do?

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The Art of the Deal Summary The Art of the Deal Guide Chapter 11: Trump’s Gamble—United States Football League

In a departure from real estate, Trump took a chance on the United States Football League (USFL).

He went against his guiding principle to prepare for the worst and be conservative in investments when he bought a team called the New Jersey Generals, despite the fact that the USFL was struggling. Three factors influenced Trump to take the risk:

  • He loved football
  • Buying a USFL team was significantly cheaper than buying an NFL team
  • He liked the prospect of challenging the NFL’s monopoly on professional football

Trump felt he could resolve the USFL’s two major challenges, which were:

  1. The USFL needed to have top-quality players, competition, and marketing in order to draw fans, press, and money.
  2. The USFL had its season in the spring, but Trump didn’t think fans or TV networks would get on board for spring football.

Have a Good Product: Trump Recruited Top Players

In order to draw fans, get press, and sell tickets, the USFL had to offer exciting football games with talented players.

Trump and other USFL team owners poached several star NFL players for a boost of talent and attention. But Trump also thought the USFL needed to prioritize recruiting...

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The Art of the Deal Summary The Art of the Deal Guide Chapter 12: Trump Finished What NYC Couldn’t—Wollman Ice Skating Rink

In 1980, New York City officials closed a 30-year-old ice skating rink in Central Park for renovations. The project was scheduled to take two-and-a-half years and cost $2 million.

Trump’s apartment in Trump Tower overlooked Wollman Rink, and year after year he watched as the construction dragged on. Meanwhile, he’d see articles reporting that the project still had no end in sight and was running way over budget.

In 1984, Trump contacted the NYC parks commissioner and offered to take over the project for no fee, but the commissioner refused.

In 1986, after NYC officials announced they were starting over and projected two more years until completion, Trump offered again—and, again, the commissioner refused.

Promote: Trump Used the Power of the Press

Trump sent Mayor Ed Koch a letter saying that the rink’s delays and budget overruns signaled incompetence. In the letter, Trump offered to pay for and build the rink, and then operate it and lease it to the city after its completion. Furthermore, Trump said he could have the rink ready to open within six months.

Koch’s reply balked at Trump’s proposal to operate the rink, but he said Trump could pay for and oversee...

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Shortform Exercise: Keep Costs Low on Your Project

Bringing projects in under budget requires strong, decisive leadership.


Describe a situation when incomplete planning or indecisiveness led to higher costs on a project.

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The Art of the Deal Summary The Art of the Deal Guide Chapter 13: A Second Chance—West Side Rail Yards

Six years after Trump reluctantly let his option expire to buy the West Side rail yards, he bought them back for about $95 million.

Compared to the $500 million another developer paid for a smaller site nearby, Trump got a great deal on the West Side yards for several reasons:

  • The bank was preparing to foreclose on the seller
  • Trump bought the site before it went for sale on the open market
  • Unlike other developers, Trump could afford the millions in carrying costs he’d have to pay on the site until he developed it

In the meantime, New York City real estate values had multiplied several times over.

When Trump had the purchase option for the yards a few years earlier, he was a young developer with little money and no track record. This time around, Trump had the benefits of experience, money, and several successful projects.

Their Loss Is Your Win: Trump Benefited from an NYC Outsider’s Mistakes

The property's seller was a wealthy Argentine bridge builder named Francisco Macri. Macri was generally qualified, but he was new to NYC real estate development.

Macri made several fatal errors in handling the West Side yards project:

1. Macri agreed to...

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Table of Contents

  • 1-Page Summary
  • Chapter 1: Each Day Is Full and Flexible
  • Chapter 2: Guiding Business Principles
  • Exercise: Apply Trump’s Principles
  • Chapter 3: Trump’s Formative Years
  • Chapter 4: Trump’s First Deal—Cincinnati Apartments
  • Chapter 5: Trump’s First NYC Deal—34th Street Convention Center
  • Chapter 6: Remaking a Classic—The Commodore Hotel
  • Exercise: Have a Bargaining Chip
  • Chapter 7: A Juggling Act—Trump Tower
  • Chapter 8: Trump’s First Casino—Trump Plaza
  • Exercise: Prepare for the Worst
  • Chapter 9: Trump’s Second Casino—Trump Castle
  • Chapter 10: Fierce Opposition Forces an Alternative Plan—Central Park South
  • Exercise: Be Flexible
  • Chapter 11: Trump’s Gamble—United States Football League
  • Chapter 12: Trump Finished What NYC Couldn’t—Wollman Ice Skating Rink
  • Exercise: Keep Costs Low on Your Project
  • Chapter 13: A Second Chance—West Side Rail Yards