The Closing with Jeff Greene

Billionaire investor Jeff Greene is best known for making hundreds of millions of dollars shorting subprime mortgage-backed securities before the 2008 financial crisis. But he’s also a developer and property owner, with a portfolio of 3,000 residential units in Los Angeles. He’s currently developing two New York City condo projects: a 140,000-square-foot property at 100 Vandam Street, and a six-story building at 576 Broome Street. He’s also tried his hand at politics. In 2010, Greene made an unsuccessful bid for a U.S. Senate seat in Florida, losing in the Democratic primary.

What is your full name?

Jeffrey Bennett Greene.

What is your date of birth?

December 10, 1954.

Where do you live?

We’re in Palm Beach about eight months of the year. We’re in the Hamptons two to three months a year, and we also have places in Beverly Hills and Malibu.

How did you meet you wife, Mei Sze?

We first met at a charity dinner and then we became reacquainted seven years ago in Sag Harbor, at a birthday party for Mike Tyson on my boat. We have two boys and a third on the way.

Mike Tyson was also the best man at your wedding. How do you know each other?

We met in Malibu 20 years ago. I know a lot of very colorful people from living in L.A. I consider him one of my best friends.

Sounds like you had a pretty crazy social life before getting married.

It’s described by some people as crazier than it really was. I’d have a few big parties and they’d sometimes be a little crazy, and so people would assume that’s what I did all the time. I wasn’t going to parties every day — I was a serious adult, with a business career. I’d go to St. Bart’s over New Year’s in my boat and have one big party, and the next party I would have would be Memorial Day weekend.

Do you still throw big parties?

Yeah, but now the average age [of the guests] is two. It’s all Elmo and Ferris wheels.

Where did you grow up?

Worcester, Massachusetts. My dad had a textile machinery business, [but] he lost his livelihood in the late 1960s because the textile industry moved to the South. My mother, who had been a stay-at-home mom, ended up having to work as a waitress to make ends meet. In my junior year of high school, [they] moved to West Palm Beach and bought a company that made rubber stamps. I stayed in Massachusetts with a great-aunt to finish up school.

Did you make trouble for your aunt?

No. I was really nerdy and played trumpet in the high school band. I thought the cool thing was getting into a good college.

Where did you go to college?

John Hopkins University. I finished a four-year degree in two-and-a-half years. I was working three jobs, teaching Hebrew school and working as a busboy and a waiter.

What did you do when you graduated?

I lived on the road for almost three years selling circus tickets. I had a Pontiac Grand Am with a bar across the back seat with my clothes hanging on it. I’d pull into, like, Bluefield, West Virginia, or Dubuque, Iowa, check in to the local Motel 6 or Econo Lodge, and be there for a week or two running these telemarketing operations. It was a very lonely life. But I saved up to $100,000, which was a lot in the mid-1970s.

How did you get into real estate?

I decided to go to Harvard Business School, and I wasn’t sure where to live, so I took all this cash I’d saved and bought a three-unit building, in Somerville, Massachusetts. The idea [was] that I would live in one unit and rent the other two to cover the costs. It worked out so well that I started buying more. By the time I got my MBA, I had 18 properties and my $100,000 was worth over $1 million. I was running around showing the apartments and collecting the rents.

After business school, you moved to California and got into real estate there.

Around 1983, I bought [an] eight-unit building in Brentwood for $510,000. … By 1991, I had about a $110 million portfolio, and my net worth was probably $35 or $40 million. I was feeling pretty pleased with myself. I was 36 years old and I had a house up in Bel Air and one in Malibu, on the beach. I was a single bachelor with a Mercedes and a Ferrari in the garage. Then, all of a sudden, the market crashed. I spent the next three years trying to dig out from under the mess.

What made you start investing in mortgage-backed securities in the mid-2000s?

I was sitting on a billion-dollar real estate portfolio and thinking, What if the market dips again? I really felt like these prices couldn’t go on forever, and I thought, There’s got to be something I can do to protect myself in the event of another slowdown.

How much did you actually make from those trades?

In the $800 million range.

You’re known as a very tough boss, and you’ve been nicknamed “Mean Jeff Greene.” Is that an accurate characterization?

I don’t think I’m mean. I put a lot of pressure on myself to do well, and I put the same pressure on the people around me. For the most part, people who have worked for me tell me they didn’t like me much, but they learned a lot. I’m very proud of that. It would be worse if they said, ‘Boy, he was a sweet guy, but I learned nothing.’