New York financier Howard Milstein is a big sports fan, so he bought a 50 percent stake in the New York Islanders hockey team and is going after the Cleveland Browns National Football League franchise and the New Jersey Nets basketball team as well.
Given the requisite financial resources, what boyish American–and the 47-year-old Milstein has a grin that radiates happy youthfulness–wouldn’t do the same?
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He’s also bought a half interest in a Chicago team as well. It’s not a professional sports team, but Milstein sounds as if the move could be a step in building another type of league of his own.
Milstein, chairman of New Yortk real estate brokerage Douglas Elliman, recently put some of his ample capital–he won’t say how much–into acquiring half ownership of the Miglin-Beitler Management Corp. He bought up the interests of the heirs of Lee Miglin, who was murdered last year.
The investment is a part of a plan to gather midsize but highly respected commercial real estate services firms in cities around the country into a group that can compete with the big national real estate companies while remaining innovative and entrepreneurial in local operations, Milstein said.
He added that Miglin-Beitler Chairman Paul Beitler, known for his highly individualistic approach to the business, represents the kind of local talent he wants.
“Beitler is an exemplar of someone who approaches management and brokerage with TLC (tender loving care), who knows it’s not about buildings but about people,” he said.
Milstein, a third-generation member of a New York real estate, finance and banking family, challenged the current rage for bigness in the real estate business represented by giant real estate investment trusts such as Chicago financier Sam Zell’s Equity Office Properties Trust, the country’s biggest office property owner.
“Zell built a huge empire based on finance. We wanted to build a company oriented to the customer,” he said. “Big doesn’t mean good. Big means big. The Ottoman Empire was big, but it went into a decline for a long time.”
(Zell has assumed some colorful roles, but a pasha leading a Byzantine bureaucracy would certainly be a new departure. Success hasn’t calcified Zell yet, though anything is possible.)
Milstein said true entrepreneurs won’t work for publicly held REITs or real estate operating companies (like Chicago’s LaSalle Partners Inc., Northbrook’s Grubb & Ellis Co. or Insignia Financial Group Inc. of Greenville, S.C.) because they value independence and the entrepreneurial spirit.
One example of that is Peter Ricker, now executive vice president of Miglin-Beitler, who was head of the eastern region of Galbreath Co. before that management and development firm was taken over by LaSalle last year, a few months before LaSalle went public.
“A lot of Galbreath people couldn’t stand LaSalle,” said Ricker, who visited the Tribune along with Milstein and Beitler. “People with new ideas don`t work in huge bureaucracies.”
Ricker added that at least three of the Miglin-Beitler staffers who left the firm a few months ago when rumors were flying about a company breakup have returned to work, including the comptroller and the human resources head.
Milstein, who recently bought another small New York commercial real estate firm, said he is also looking at Los Angeles and a half-dozen other cities to expand his new real estate league, as long as he can find local companies compatible with his “philosophy of service and attention to detail.”
He’s also, among other projects, working on developing a new stadium on Long Island to house the Islanders and perhaps the Nets, who he’d like to move from New Jersey if he can make a deal for the team.
“We could be in the (stadium) management business,” he said. “That business could use some quality management.”
Could there be a Chicago connection there, too?
Beitler boom? Beitler, who has already announced a 1.1 million-square-foot office and retail project at State and Adams Streets, said he is also negotiating for a site for yet another office building, on Wacker Drive in the West Loop.
“If everybody (with downtown office development plans) builds tomorrow morning, we won’t have a glut of space as in the past,” insisted Beitler. “In a year and a half, the pressure for office space will be building.”
Beitler said he is also planning a 450-unit Streeterville apartment building partially dedicated to assisted living for seniors and a 900-car parking facility. He’s in negotiations for the site, he added.
And he is also planning a major office building and two hotels on the Techny property in Northbrook.
Beitler speaks with the verve of a man who has just found a well-heeled New York partner.
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Said Milstein placidly: “We are putting together an investment fund. There are no limits to the money available for good deals with good operators.”
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