Notable for having developed London's Canary Wharf and New York's World Financial Centre. At one point was the largest single commercial property owner in NYC.
Paul Reichmann, the Canadian real estate developer who made and lost billions of dollars while transforming the skylines of Toronto, New York and London, died on Friday in Toronto. He was 83.
His death was announced by a spokeswoman for ReichmannHauer Capital Partners, an investment firm.
Mr. Reichmann and his brothers, Albert and Ralph, led Olympia & York, their family’s real estate development firm, which counted among its greatest projects the World Financial Center in Lower Manhattan and Canary Wharf in London’s East End. At their apex in 1990, the Reichmanns held about 8 percent of New York City’s commercial office space, more than twice as much as their closest rival, the Rockefellers.
In all, Olympia & York owned 40 major office towers in a dozen cities on both sides of the Atlantic and controlled $20 billion in assets. The net personal worth of the Reichmanns reached $10 billion, making them at one point among the 10 wealthiest families in the world. But in 1992, they ran out of cash while building Canary Wharf, and their real estate business quickly collapsed.
Paul Reichmann, a tall, soft-spoken man who dressed in black suits, white shirts and dark ties, was clearly the family business strategist and chief decision-maker. He and his family were lavish contributors, mostly to Orthodox Jewish causes; they donated up to $50 million a year to yeshivas, synagogues and hospitals around the world.
Despite his austere demeanor, Mr. Reichmann took enormous business risks. He bet that each new development project could exceed the size of the previous one and still attract enough tenants to produce a windfall.
“For Paul, it is like being a gambler, like being a heroin addict — he cannot stop,” Andrew Sarlos, a prominent Toronto investment banker and Reichmann family friend, said in a 1988 article in Maclean’s, the Canadian weekly.
Mr. Reichmann scoffed at that sort of criticism. “You don’t get the returns if you don’t take the risk,” he said in an interview with Institutional Investor magazine in 2000.
For years, Mr. Reichmann’s track record was so impressive that his creditors did not seem to mind his high-roller approach. His sense of timing in the notoriously cyclical real estate market seemed infallible, and he was viewed as a master negotiator with an uncanny understanding of financing techniques.
But the Reichmann empire crumbled in 1992. The immediate cause was the Canary Wharf project in London. With real estate prices plunging around the world, other major Reichmann properties were also in the red, and the family’s stock market investments soured.
Crushed under debts of more than $20 billion, Olympia & York went bankrupt. The Reichmanns were left with a net worth of less than $100 million — one of the most astonishing financial collapses in history.
Paul Reichmann blamed his own overconfidence. “The fact that I had never been wrong created character flaws that caused me to make mistakes,” he said in 1997.
Mr. Reichmann and his family partly rebuilt their fortune. In a personal triumph, he recovered control of Canary Wharf in 1995, as a minority partner and chairman of an investment group that included George Soros and Laurence Tisch, and then pushed ahead with the completion of the project. He retired in 2005 after an alliance of developers led by Morgan Stanley acquired Canary Wharf.
The strains of commerce and religious orthodoxy were often inseparable in the family’s ventures. For example, Olympia & York closed its construction sites on the Jewish Sabbath, paying overtime for Sunday labor, and during the Jewish religious holidays, as well as Christian ones.
At the height of his business career, Mr. Reichmann sometimes spoke wistfully of the Talmudic studies and religious school building projects he undertook as a young man.
“I think that what I did in those years was a greater achievement than what I’ve done since,” he was quoted as saying in a 1996 biography of his family, “The Reichmanns,” by Anthony Bianco. Paul Reichmann was born in Vienna on Sept. 27, 1930, the fifth of six siblings. His parents, Samuel and Rene, were Orthodox Jews who had moved from rural Hungary to Vienna, where they owned a prosperous egg export business. But Nazi Germany’s annexation of Austria in 1938 forced the family to flee to Paris.
Two years later, when the Nazis overran France, the Reichmanns fled to Tangier, Morocco, where Samuel Reichmann became a successful currency trader.
When anti-Jewish riots broke out across the Middle East after the 1956 Arab-Israeli War, the Reichmanns uprooted themselves again, this time going to Canada. The family settled in North York, a suburb of Toronto, where Samuel and his sons, Paul, Albert and Ralph, started a small company producing tiles and other building material, which they called Olympia Tile. In 1958, it became the springboard for Olympia & York, which would erect close to 100 buildings in the Toronto area over the next 15 years.
The most notable of these projects was First Canadian Place, a 72-story office tower in downtown Toronto that was the country’s tallest building. Completed in 1973 after only 16 months and using vast quantities of magnificent white marble, the tower gained the Reichmanns a reputation for quality projects delivered at an accelerated pace.
The success of First Canadian Place also encouraged Paul Reichmann to venture into the United States real estate market. His first foray involved the purchase of eight prime Manhattan office buildings from the Uris Corporation in 1977 for $325 million. At the time, New York City seemed on the verge of bankruptcy, and its office vacancy rates were soaring. But a decade later, the same properties were valued around $3 billion.
By then, Mr. Reichmann and his brothers were heavily involved in their most heralded project, the World Financial Center. In 1980, the still relatively unknown Olympia & York won out over a dozen other developers, most of them local firms, to build six million square feet of office and retail space near Battery Park on land reclaimed from the Hudson River.
The project’s design, by the Argentine-born architect Cesar Pelli, featured four office towers ranging up to 51 stories, on top of a huge base devoted to luxury stores. The centerpiece of the complex, the Winter Garden, was a 130-foot-high, glass-vaulted pavilion landscaped with palms. When the design for the World Financial Center was unveiled in 1981, it was hailed as “the finest group of skyscrapers since Rockefeller Center,” by Paul Goldberger, The New York Times’s architecture critic.
By the end of the 1980s, the Reichmanns were the seventh-richest family in the world, according to Fortune magazine. But they still lived relatively modestly in the same upper-middle-class homes they had built for themselves in their Toronto suburb a generation before.
Paul Reichmann’s wife, Lea, occasionally complained that her husband was too involved in his business and not spending enough time with his children, Barry, Henry, Vivian, Rachel and Libby. But he was home every Sabbath and holiday, joining his family and neighbors as they walked to the nearby temple for services.
In 1988, Mr. Reichmann took the greatest gamble of his life by committing Olympia & York to build Canary Wharf. The completed project was supposed to have 24 buildings and 12.5 million square feet of office space at an estimated construction cost of $8 billion.
Despite generous subsidies and rent cutbacks, only a fraction of the commercial space was occupied. By late 1991, Canary Wharf was paralyzed by a lack of further financing. And early the next year, Olympia & York announced that it had run out of cash.
Many of the family’s other real estate holdings were also in trouble because of high office vacancy rates in a number of North American cities. The Reichmanns filed for bankruptcy protection in London, Toronto and New York simultaneously.
Only three years later, Mr. Reichmann regained the helm at Canary Wharf, which finally gained nearly full occupancy in 2000 thanks to a booming real estate market in London. By 2000, the Reichmann family’s net worth reached $1 billion. But in an interview with Institutional Investor that year, Mr. Reichmann said his business accomplishments had never given him the sense of fulfillment he experienced as a youthful religious social worker and teacher in North Africa. But “what could have been is a silly way to look at things,” he said. “You are what you are.”