Having floated off his US Office portfolio, Zell is turning his attention to development opportunities in eastern Europe.
US property legend Sam Zell is moving into eastern European and Russian markets. Zell, who is known as “the grave dancer” because of his flair for buying up distressed companies and turning them around, is launching a new venture, Emerging Europe Property Co.
Equity Group Investments, Zell’s private holding company, will be one of the principal investors in EEP, which is looking for both development and investment opportunities in the target countries from its London base.
In a major coup Zell recently lured Richard Powers, head of GE Capital’s European property financing arm to head up the new venture.
With a huge property portfolio, Zell is a massive player in the US market. Together with partner Robert Lurie he started in the 1960s by managing student housing, and soon graduated to investing in residential real estate, forming Equity Financial & Management Co.
In the 1980s they began making corporate acquisitions with Great American Management & Investment, a foundering property management company Zell formed four property funds in the 1990s with Merrill Lynch and tried unsuccessfully in 1995 to gain control of the company that owns the mortgage on Rockefeller Center in New York.
Last year Zell decided to combine his four office property funds into a single public REIT, Equity Office Properties, capitalised at $5.5bn.
Also in 1997 Zell’s Equity Residential Properties Trust bought Wellsford Residential Property Trust for $1bn, making it the largest public apartment company in the US.
This month EOP was reported to have placed the Denver Post Office Tower, Denver, under offer. Zell is said to have offered over $50m for the 54,733m2 office building. He already owns 92,900m2 of offices in the city.
