Friday Letter Making the list

The tremendous amount of wealth that real estate investors, private equity or otherwise, have generated over the past 25 years was brought into stark relief earlier this month when Forbes published its annual list of the 400 richest Americans. Found among the rankings of the über-rich were 33 property moguls, ranging from long-time stalwart and Irvine Company head Donald Bren (number 27 on the list with an estimated net worth of $8.5 billion, the highest of any real estate investor) to newcomers such as Colony Capital founder Tom Barrack (374) and Vornado chief executive Stephen Roth (278). 

Several entrepreneurs who made their fortunes elsewhere—but later fell off the list due to divorce or dwindling stock prices—were able to rejoin the rarified rankings by plowing money into property: BET founder Robert L. Johnson came in at number 374 after actively buying up hotels through his private equity real estate arm RLJ Development, while Netscape founder Jim Clark bounced back to number 354 due in part to his majority stake in construction firm Hyperion Development Group.

As Johnson and Clark can attest, the Forbes 400 has seen its fair share of comings and goings over the years. A case in point: JMB Realty co-founder and Walton Street chairman Neil Bluhm (215), who fell off the list in 1992 during a down-tick in JMB’s fortunes, but returned once again in 2000. Of course, some real estate luminaries have never left: Sam Zell (52) has been on the list since 1986.

In today’s global marketplace, property fortunes are not limited to the US. The second-richest person in China, Zhu Mengyi, earned his money in the country’s booming property markets. The fifth-richest person in India, Kushal Pal Singh, is the head of DLF Group, the largest real estate developer on the subcontinent. And Down Under, shopping center magnate Frank Lowy is the second-richest man in Australia.

Just as Forbes has been ranking the richest people in the world for the past quarter of a century, so too have other media publications contributed their own takes on the most powerful or important members of a given community. However, up until now, the private equity real estate industry has been excluded from such scrutiny. Though Barrack, Bluhm and Zell find themselves together on the Forbes 400, the business that unites them does not have a list to call its own.

Next month, our sister publication Private Equity Real Estate makes amends. In an article entitled “The 30 most influential people in private equity real estate,” PERE will present our editor’s picks (after consultation with industry practitioners around the world) of the men and women who have had the greatest impact on this increasingly important asset class. Unlike Forbes, net worth will not be the defining factor, though monetary success is certainly one benchmark; rather we will look for those individuals who have done the most to transform private equity real estate from a small collection of distressed investors into a sophisticated, global industry.

Given the broad scope and size of today’s market, our picks will not be limited by geography or background—our list will encompass the globe and our selections will include fund managers, institutional investors, lawyers, consultants and other third-party advisors.

Though the final list will be determined by our editors, we welcome any suggestions from our readers. Send us your picks via e-mail by clicking here: All input will be confidential.

Only one caveat: self-nominations are not allowed. After all, we have our standards (although a discreet, well-timed bribe never hurts).

Check out the November issue of PERE for the results.

PS. Don’t forget to register for the upcoming 2006 North American Private Equity Real Estate Forum, being held in New York City on November 1 and 2, featuring a keynote speech from Jay Mantz of Morgan Stanley and one-on-one discussions with Barry Sternlicht of Starwood Capital and Jeff Kaplan of Westbrook Partners. The early-bird discount ends today. Sign up here