Sam Zell has also ventured into owning media companies in the United States such as the ‘Chicago Tribune’ and ‘Los Angeles Times’; he was 81 years old
THE NEW YORK TIMES – Sam Zellthe tycoon real estate which specialized in problem assets and acquired the Chicago Tribuneor Los Angeles Times and other historic newspapers, in a widely criticized leveraged buyout in 2007, died this Thursday 18. He was 81 years old.
His death was announced in a statement from Equity Group Investments, a company founded by Zell and of which he had been president. The note does not say where he died and attributes his death to “complications from a recent illness”.
The son of Polish Jews who fled to America in 1939 as World War II engulfed Europe, Zell, an eccentric Chicagoan who delighted in testing the limits of business and motorcycles, amassed one of the largest portfolios of apartments, offices and commercial real estate, mostly snatching properties that other investors rejected as too risky or even doomed.
He called himself “the dangerous dancer,” celebrating his own triumphs as a high-stakes speculator who found opportunities where others saw only stress.
A hoarse-voiced little man with a bald head, crossed eyes, and a white beard, he preferred gold chains, brightly colored sports shirts, and jeans. He rode a bright yellow Ducati to work at high speeds and sometimes took road trips with a group, all in leather jackets, whom he called Zell’s Angels.
He could vibrate with vulgarity and insults, which also often filled his speeches. But he also sent hundreds of music boxes to acquaintances over the Christmas season.
On the contrary Donald Trump and Harry Helmsley, who used their names on trophy estates and in self-promotion, Zell was relatively anonymous for most of his career, widely known in financial and real estate circles as a daring investor whose vision – to create a national brand — hasn’t materialized because estate sales are largely local.
However, in 2007, the Blackstone Group bought Zell’s company, then known as Equity Office Properties Trust, for $39 billion. His fortune has been estimated at nearly $5 billion, with stakes in residential properties, drug and department store properties, as well as energy and electronics companies. A lifetime of acquisitions made him one of the richest men in the country: he could easily have retired at 60.
But, seeing another inefficient market, he plunged into the unknown world of newspapers, winning a bidding war for one of America’s leading media companies, the 160-year-old Tribune empire. In addition to Chicago and Los Angeles newspapers, it included The Baltimore sun, newsday, The Hartford Courant23 television and radio stations, the Chicago Cubs baseball team and Wrigley Field.
Business in Brazil
In 2005, Zell’s Equity International investment fund became a partner of Gafissa, buying 32% of the construction company, for 50 million dollars. Shortly thereafter, in February 2006, Gafisa made its initial public offering on the stock exchange.
That same year, he helped set up BR Malls, a leader in the shopping center industry in Brazil, with GP Investimentos, which ended up permanently leaving the business. The company went public in April 2007.
Zell also had a stake in Bracor, which specializes in commercial and industrial real estate; at AGV Logistics; at the famous construction company Tenda; and in Brazilian Finance & Real Estate, residential mortgages, loan securitization and real estate fund structuring. Over the years, however, the businessman was getting rid of the business in Brazil.
Entrepreneur at age 12
Samuel Zielonka was born on September 28, 1941 in Chicago. He was the son of Berek and Ruchla Zielonka, who changed their names to Bernard and Rochelle Zell after they immigrated and settled in that city, where his father got into the real estate and jewelry wholesale business.
Sam grew up as an entrepreneur. At age 12, he found Hugh Hefner’s new Playboy magazine on the newsstands, bought copies for 50 cents, and sold them to neighborhood kids for $3 apiece. At Highland Park High School, his 1959 yearbook graduation photo bore the caption, “I’m not asking, I’m telling.”
At the University of Michigan at Ann Arbor, he began managing some off-campus housing for one landlord. He and a friend, Robert H. Lurie, who became his business partner, bought affordable houses, remodeled them, and rented apartments to other students.
Zell received a law degree in 1966. In the 1970s and 1980s, he and Lurie acquired nationally diversified holdings in residential and commercial real estate, anticipating booms and busts and acquiring distressed assets.
In 1976, Zell was indicted on tax evasion charges in a real estate deal. But the charge was dropped after he agreed to testify against his brother-in-law, Roger Baskes, who was sentenced to prison and served two years.
After Lurie’s death in 1990, some companies went bankrupt. But in 1993 it acquired Jacor Communications, a struggling radio company, which it expanded to become one of the nation’s largest radio chains before selling it in 1998 to Clear Channel Communications for $4.4 billion.
He thrived on publicly traded real estate mutual funds, which lured investors with tax breaks and big returns. His holdings were among the nation’s largest in residential and commercial properties and RV parks.
Its $39 billion sale of equity office properties, one of the largest leveraged buyouts of all time, came just before the 2008 and 2009 recessions that devastated real estate markets and the national economy.
Zell’s life was reviewed in a 2009 biography by Ben Johnson. Unlike in business and private life, Zell avoided convention and was notoriously outspoken, often yelling at employees and using profanity in speeches and meetings.
When former Secretary of State Warren Christopher and others met with him to express concern about the health of the The Los Angeles TimesZell said he didn’t care what they thought, using an expletive for emphasis.
Zell, who had homes in Chicago, Sun Valley, Idaho and Malibu, California, was an active philanthropist, donating millions to the University of Michigan, Northwestern University and the Wharton School of the University of Pennsylvania. He has also been a major donor to causes in Israel and to the American Jewish Committee, a Chicago Jewish elementary school named after his father, and other cultural and educational institutions.
He was married three times, divorced twice and had three children. He and his third wife, Helen Herzog Fadim, were married in 1999. She survived him. He is survived by two sisters, Julie Baskes and Leah Zell; daughters Kellie and JoAnn Zell; his son Matthew; and nine grandchildren.
Source: Terra
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