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Wall Street & Real Estate

May 30, 2008

wall street pic


Paulson, Soros and Simons. 

Who are these guys?  And what do they have to do with Real Estate? 

This question has been on my mind since I think around April 16, 2008.  This is the date the news started reporting on the unprecedented amount of money these three men made in one year….2007. 

John Paulson manger of Paulson & Company made $3.7 billion  

George Soros came out of retirement last summer and somehow made $2.9 billion with his Quantum fund.

Dr. James H. Simons, President of Renaissance Technologies Corp. made  $2.8 billion.

What these three men  have in common with real estate is that they all made their respective billions hedging against the real estate market.   

So, as the news keeps reporting the doom and gloom about real estate why isn’t more reported on  who is making huge profits from the real estate market whether it be on Wall Street or on the streets?  And why don’t we hear more about the huge real estate deals that are currently going on? 

For example, downtown Seattle just recorded it’s second most expensive luxury condo sale for $7,002,950. It’s just the shell and will require another couple millions to finish.  So, it will probably top the January ’08 sale of another downtown condo at $8,375,000. 

On the East coast the owner of U.S. News & World Report, The New York Daily News and real estate tycoon, Mortimer Zuckerman of Boston Properties agreed to pay $1.5 billion dollars in cash for four Manhattan office towers on 5th Avenue in one of NY’s most coveted locations.    The deal also involved Zuckerman taking on $2.47 billion in debt, pushing the deal to around $3.95 billion.    This is a record shattering deal! 

Just think John Paulson could have bought eight office towers on 5th for what he was paid last year.

As I began this post with questions I only have more questions to ask.  What are the three hedge funds led by Paulson, Soro’s and Simons hedging on now?   Where did the $9.4 billion these guys made go?  And who are the Wrights,  West coast buyers of the condo mentioned above, and Zuckerman, the East coast buyer of the towers on 5th Ave?   And what do these buyers have in common?   Stay tuned!

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