Sam Zell, a billionaire real estate investor, dies

Sam Zell, Chairman, Equity Investments Group.

Adam Jeffery | CNBC

Sam Zell, a Chicago real estate mogul with a multi-billion dollar fortune and fame as a “dangerous dancer” for his ability to revive moribund properties, dies of complications from his recent illness. He was 81 years old.

Bearded and blunt-spoken, Zell happily went against conventional wisdom. He had a golden touch with real estate, and began managing apartment buildings while an undergraduate. By the time he reached his seventies, he had amassed an estimated fortune of $3.8 billion.

He sold Zell Equity Office, an office tower company he spent three decades building, to the Blackstone Group for $39 billion in 2007. It was the largest private equity deal in history, and it netted Zell personally $1 billion.

A month later, he struck another deal that finally tarnished his image: the acquisition of the troubled Tribune Company for $13 billion. The media giant filed for bankruptcy the following year.

Real estate was his trademark, but as he noted in an interview shortly before the ill-fated Tribune deal, it only represented about 25 percent of his holdings.

“I’m a professional opportunist,” Zell told the Associated Press at the time. “I am sure that no matter what topic you choose, we are involved in one way or another.”

Zell was born in Highland Park, Illinois, on September 28, 1941, four months after his immigrant parents arrived in the United States. They fled Poland before the Nazi invasion.

His father was a wholesale jeweler and worked successfully in real estate investment and the stock market. Young Zell took pictures at his eighth grade graduation party and sold them, after which he bought Playboy magazines in downtown Chicago and resold them to his classmates at a suburban Hebrew school for a 200 percent markup.

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His first real estate successes came while he was a student at the University of Michigan. After managing the building he lived in for free rent, he moved on to managing other properties, eventually incorporating and then selling the apartment management business.

After working briefly at a Chicago law firm, he teamed up with his fraternal brother, Robert Lowery, in Ann Arbor and began acquiring distressed real estate from developers who had defaulted because of high interest rates. This practice continued through the recession of the mid-1970s, with great success.

He later co-founded the Samuel Zell & Robert H. Lurie Institute for Entrepreneurial Studies at the University of Michigan’s Ross School of Business in 1999 with Lurie’s widow, Ann.

Zell’s reputation grew, and in 1976 the opposition investor spoke of his penchant for spotting and pursuing opportunities in an article titled “The Grave Dancer”. The surname stuck.

After the savings and loan crisis of the 1980s, Zell went on a property-buying spree. He also encouraged institutional investors to pool their money in commercial real estate in the early 1990s when it was abroad.

Zell loved taking risks, both in his business dealings and in his personal life. He once admitted to riding his motorcycle at 145 mph on a trip across the South American pampas.

His love of motorcycles caused him to form a group called Zell’s Angels, made up mostly of businessman friends who would ride with him around the world. He has been an avid skateboarder, racquetball player, paintball enthusiast, and sports fan over the years, with stakes in the Chicago Bulls and Chicago White Sox.

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Zell was very protective of his personal life. Reports stated that he was married at least three times and had three children. He maintains homes in Chicago and Southern California.

“Sam Zell was a self-made entrepreneur and visionary. He launched and grew hundreds of companies during his career spanning more than 60 years and created countless jobs. Although his investments spanned industries all over the world, he was widely known for his critical role In the creation of a state-of-the-art real estate investment fund, which today is an industry worth more than $4 trillion, Equity Investments Group said in a written statement Thursday.

The company said Zell died at home.

Zell is survived by his wife, Helen. his sister, Julie Baskes, and her husband, Roger Baskes; His sister is Leah Zell. his three children, Kelly Zell, son-in-law Scott Pibet, Matthew Zell, and Joanne Zell; and his nine grandchildren.

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