Sam Zell, the real estate mogul who led the Tribune Company into bankruptcy, has died at the age of 81

Sam Zell, the foul-mouthed real estate tycoon who acquired the Tribune Company, publisher of the Los Angeles Times and Chicago Tribune, was emboldened by mismanagement, allegations of sexual harassment and financial disasters that eventually bankrupted the company. , died May 18 at 81.

Chicago-based Equity Group Investments said he died after complications from a brief illness. No further details are available.

Known as the Grave Dancer, a nickname he gave himself, Mr. Zell made his fortune—estimated at $5.2 billion by Forbes—by buying up financially distressed apartment buildings, office towers and other real estate, and then raising rents after fixing them up.

“Some may see buying and creating value from the mistakes of others as a form of exploitation,” he wrote in his autobiography, “but I see it as giving new life to neglected or devalued assets, in any industry,” “Am I Too Accurate?” “I don’t pretend to be altruistic – I’m just optimistic and confident that I can change these assets.”

Mr. Zell would wear jeans to work, approach motorbikes and fire shells like mortars. His gruff, gruff personality made him an entertaining guest on CNBC, but his swagger set off BS detectors for uncomfortable and skeptical Tribune journalists almost immediately after the publisher’s $8.2 billion acquisition was completed in 2007.

Although his experience with newspapers was limited to reading them, Mr. Zell told his new employees that he wanted to reinvigorate the company’s culture to be bolder and smarter.

“The challenge is, how do we get a 126-year-old to get it?” he told Times staff at a staff meeting. “I’m your Viagra, okay?”

At another get-to-know-you meeting at the Orlando Sentinel, another Tribune Co. outlet, Mr. Zell disagreed with the photographer’s question and ended his answer with “F—you.” In the Washington office of the Tribune Company, he told reporters, “This is the first unit of the Tribune I’ve spoken to that doesn’t generate any revenue. So you’re all in over your heads.”

Mr. Zell’s new executives prove to be a similar problem.

The New York Times reported that Randy Michaels, a former disc jockey hired to oversee the company’s publications, offered a waitress $100 to show her breasts during a casual meeting with other Tribune employees at a hotel. Michaels denied the allegation. As the New York staff said Times when CEOs used crude innuendo and discussed the “sexual suitability of various employees”.

The company, already reeling like other papers from the internet disrupting the news business, was saddled with another problem: a staggering amount of debt. As part of the deal, Mr. Zell put up just $315 million of his own money, covering the rest of the acquisition in a complex debt scheme that collapsed during the Great Recession in 2008.

On December 8, 2008, about a year after Mr. Zell’s acquisition closed, the Tribune Company filed for bankruptcy.

Samuel Zielonka was born in Chicago on September 28, 1941, four months after his parents, who were Jewish, immigrated from Poland during the Nazi invasion and shortened their last name to ZIL. His father worked in the jewelry business.

Growing up in Highland Park, a thriving suburb north of Chicago, Mr. Zell showed an early entrepreneurial streak. He bought old Playboy magazines for 50 cents and sold them for $3. The caption he wrote to his yearbook photo hinted at his future self: “I’m not arguing with you. I’m telling you.”

He majored in political science at the University of Michigan, graduating in 1963. In Ann Arbor, he ran a 15-unit apartment building in exchange for free room and board.

Mr. Zell stayed in town for law school, though his classes were an afterthought for his fledgling real estate business. In 1965, he purchased a three-unit apartment for $19,500, advancing $1,500 from his management of other apartments.

He wrote in “Am I Being Too Soft?” “Two months later, I bought another building almost next door, and then I bought the house in between.”

By the time he graduated from law school, Mr. Zell was now in business with his brother Bob Lowery, managing 4,000 apartments and owning over 200.

In 1968, he founded the Equity Investments Group, the private investment firm that managed many of his entities. Mr. Zell has also invested in radio stations, cruise ships, mattresses, and Schwinn bicycles.

He explained his investment strategy in a 2004 interview with Columbia University Business School’s newsletter, “The Bottom Line.”

“I always thought simple,” he said. “I look at situations and act when I think the problems are temporary. I believe if you can buy assets that have enough carrying capacity, you won’t lose over time.”

In the 1970s, he said, apartment buildings cost $20,000 but it was only $10,000 to buy.

He said, “My thesis was that if it’s a good, reasonably built site, I’m competing in the $10,000 market and new people will have to compete with $20,000 or $25,000.” “I didn’t believe there was any way you could lose assuming you had the power to carry it.”

Mr. Zell has been divorced twice. Among the survivors was his third wife, Helene Herzog Vadim. three children; two sisters; and nine grandchildren.

Mr. Zell admitted in his autobiography that he was not a saint.

“I have an unwavering sense of urgency,” he wrote. “What I can’t figure out is why so many people don’t have it. But from an early age I realized I had a very different perspective than my peers. And I was willing to trade conformity for authenticity—even when it meant being quirky, which it usually did, and even if it meant to be on my own.”

#Sam #Zell #real #estate #mogul #led #Tribune #Company #bankruptcy #died #age

Leave a Comment

Your email address will not be published. Required fields are marked *

Scroll to Top