Real estate is setting itself up for some real-life “Succession” sequels.
As more property moguls from the Baby Boomer generation (or the Silent Generation before it) step down, questions about who will inherit their thrones loom large. Some transitions have been surprisingly drama free — and not necessarily about the kids.
Our cover story this month focuses on the legacy of Sam Zell, the contrarian billionaire investor who died last month at 81. Zell was as brash as Logan Roy — known for his audacious deals and irreverent persona, which included his love of motorcycles.
He was a pioneer in taking real estate companies public through REITs, championing the sector and contributing to its growth into a trillion-dollar business. And he earned the nickname “the grave dancer” for his love of snapping up distressed deals.
Given all that, the successors at his two biggest REITs — longtime execs from outside his family — were named the day after he died, with little fanfare. Stock prices budged only slightly. Sometimes Frank and Gerri end up with the top job.
The Dursts, the Tishmans, the Rudins, the Roses, the Zeckendorfs, the Fishers, the LeFraks — throw a dart in New York City and you’ll hit a building owned by a family empire.
“Throw a dart in New York City and you’ll hit a building owned by a family empire.”
If you take a look at recent headlines, you can spot the changing of the guard, and how these transitions seem to be coming more frequently.
The industry lost John Cushman III and Steven Fisher last month, both scions of leading real estate families. And billionaire Richard LeFrak, who at 77 years old is facing Parkison’s Disease, announced at a Jersey City event that he is passing the baton at his family firm.
As if to demonstrate that real estate is often a multigenerational affair, LeFrak initially estimated that his massive development project in Jersey City’s Newport area would take two decades. Now, with nearly two dozen sites left to develop, he thinks it will take another 50 years. His sons, who will take over the company, estimate as much as 60. That’s a way longer time horizon than figuring out what happens to ATN after a Waystar Royco-GoJo merger.
One person less preoccupied with succession is Ari Rastegar, the Texas developer who says he is going to live forever. In this month’s Closing interview, Rastegar, who has $1 billion of projects in the pipeline including a 318-acre “miniature society” outside Austin, says he spends much of his free time focusing on longevity. He has blood drawn every 60 to 90 days, which allows his doctor to synthesize an ideal blend of the more than 100 supplements he takes each morning. Immortality would definitely lessen the drama over who’s next in line. See the interview here.
And check out our recap of our big NYC event last month. The highlight was a sit-down interview with real estate scion Stefan Soloviev, who inherited a billion-dollar portfolio from his father but intends to outdo him by building, of all things, a grain empire in the Midwest. (Hello, Hollywood! There are some great plot lines just sitting here for you.)
Elsewhere in the issue, we have rankings of the top residential brokerages in Miami, Los Angeles and San Francisco. It’s now been more than a decade since Compass began upending (and upsetting) the industry. Initially seen as a pretender to the throne, it now reigns supreme as the top-selling brokerage in all three of those markets.