Rosemary Vrablic with clients Jared Kushner and President Donald Trump (Getty, iStock)
President Donald Trump’s personal banker at Deutsche Bank has resigned.
Rosemary Vrablic, who worked in the private banking division, will step down at the end of the year, along with her division colleague Dominic Scalzi, the New York Times reported.
Deutsche Bank began lending to Trump in the 1990s, but Vrablic is credited for growing that relationship when Trump’s son-in-law, Jared Kushner, connected the two in 2011. That created tension within the bank, particularly because Trump had defaulted on a loan in 2008, according to the publication.
The relationship with Trump also prompted scrutiny from lawmakers and prosecutors seeking information on the president’s business practices. The lender signaled in November that it would sever ties with the president. A bank official at the time called the inquiries into Trump’s business “serious collateral damage.”
In total, Deutsche Bank has lent the Trump Organization more than $2 billion and still has about $340 million in outstanding debt with the firm.
In August, Deutsche Bank said it was conducting an internal review of a Manhattan apartment purchase made by Vrablic and Scalzi from a company partially owned by Kushner. To avoid conflicts of interest, banks typically restrict employees from doing personal business with clients.
The Federal Emergency Management Agency will continue to reimburse California’s “Project Roomkey” throughout the national declaration of emergency, Gov. Gavin Newsom announced last week. FEMA will reimburse 75 percent of the cost through its disaster relief fund, with the state paying the rest.
Project Roomkey has provided temporary housing to 23,000 at-risk California homeless — including thousands in Los Angeles —and those with pre-existing illnesses. At the same time, the program has provided a financial boost to hotels that have been battered by the pandemic. As of Dec. 21, there were 18 Project Roomkey hotel sites in L.A. County occupied by 2,380 people, according to a county spokesperson.
But the program’s coordination has not always been smooth between federal and state agencies, and counties, local governments and nonprofit service providers. In one instance, a hotel in Downtown L.A. was receiving Project Roomkey funding despite its owner, Shenzhen New World Group, having been implicated in an elaborate pay-to-play scandal involving former L.A. City Council member Jose Huizar. Shenzhen New World and its chairman, Wei Huang, were indicted on Nov. 30 on racketeering charges.
State officials previously announced Project Roomkey was getting phased out, anticipating federal funds drying up, and as resources shifted to buying hotels that would serve as homeless shelters.
The Newsom administration, though, began changing in mid-November, announcing $62 million in emergency funding to Project Roomkey, one of several measures the state put forward as daily Covid cases began to soar and haven’t slowed down.
Now, the assurance of FEMA money “takes the uncertainty out of the [Project Roomkey] program,” said Russ Heimerich, of the state Business, Consumer Services and Housing Agency.
An L.A. County spokesperson said the county will continue to operate Project Roomkey at least through April, though that could be extended “based on the circumstances, which include the availability of FEMA funding.”
Despite the renewal, some aid groups contracted to provide health care and meal services at Project Roomkey hotels — including the Salvation Army — are moving on. The Salvation Army said it is now focused on coordinating its efforts for a different program: “Project Homekey” In that program, the state uses federal CARES Act money to buy hotels for the homeless.
“It’s 10:30 at night, and I’m in a restaurant. My phone is ringing, no caller ID. I answer the call. It’s Larry Ellison.”
Eighteen years on, Kurt Rappaport said he still recalls exactly how the phone call that changed his life went down. He continued:
“[Ellison] says, ‘I’m flying in tomorrow. I’ll land in Santa Monica around 10:00 a.m. I’d like to be on Carbon Beach. My friend, David Geffen, lives on Carbon Beach. If there’s anything we can see, that would be great.”
Rappaport had recently co-founded Westside Estate Agency and was already a successful agent. Ellison, though, was the multibillionaire chief of Oracle, a tech titan who raced yachts in his spare time.
“I had a mental encyclopedia of properties that are on the market,” Rappaport said. “I said, ‘Two-two-four-four-five PCH. I’ll meet you there at 10:00 a.m.’ And he said, ‘If there’s anything else to see, let’s take a look at that as well.’”
(Rappaport’s memory was not entirely perfect. He later confirmed the listing was, in fact, 22334 PCH.)
One hiccup: The listing wasn’t Rappaport’s. It was held by veteran agent June Scott.
“She was a character, like a typical old dame lady of Beverly Hills,” Rappaport said of Scott. “So, it’s 10:30. It’s probably too late because June was too old, in the twilight of her career. But I tried calling her anyway. I left messages everywhere. Couldn’t reach her.”
The next day, Rappaport woke up at 5:30 a.m. and got Scott. He explained that he was bringing Ellison for a showing and would be coming to pick up the keys.
“She said to me, ‘Well, can you see if Barry could come Sunday or Monday.’ I said, ‘First off, it’s Larry, not Barry. And he’s coming in the morning.’ I begged and I pleaded. She politely said, ‘No, honey can’t do it.’
“This,” Rappaport scoffed, “is the way agents do business.”
But Rappaport was relentless. He went to the property, he pried open the door (Scott relayed she neglected to turn on the security system) and showed it to Ellison at 10:00 a.m. The deal was put together by lunch.
“And that’s how I have to be on the ball,” Rappaport said. “You can’t teach somebody court awareness, when there’s two seconds left, you’re down by two points. And instead of taking the shot, you see the guy in the corner, and you fake to them and then take your shot.”
That single-mindedness in pursuit of a sale is characteristic of Rappaport, who has long sat at the top of the heap of luxury agents in California — and make no mistake, it’s a heap full of colorful characters with envious Rolodexes. But even those rivals would grudgingly admit his dominance and marvel at a client list that includes moguls such as Ellison, Geffen and Jeffrey Katzenberg, superstar athletes such as Tom Brady and celebrities such as Ellen DeGeneres.
Rappaport, however, would take issue with even that characterization.
He sees himself not as atop other agents but in a different realm from them altogether. He measures himself by the captains of the universe he sells homes to.
“The thing to know about Kurt,” said Michael Nourmand, of Nourmand & Associates, “is that he is who he represents.”
But Rappaport is still far from his clients’ level of money and power. And it’s not clear if he’d risk his salesperson’s perch to truly enter such an orbit.
Sixteen at Spago
Over lunch at The Palm in Beverly Hills, Rappaport is interested in telling his story but self-conscious about how he will come off. Well over six feet tall with a generous head of hair, he’s clad in all black, sits ramrod straight and precisely pushes away his plate when he wants to make a point. He is polite to waitstaff but a bit miffed the hostess didn’t know who he was.
The way he tells it, Rappaport possessed an adult mind at a very young age, existed in a playground of the rich and famous and had the Gen X mindset to be bored with most of it.
An only child of divorce, Rappaport grew up with his mother in the San Fernando Valley. At the age of 12, he moved to Westwood to live with his father, Floyd Rappaport, an entertainment lawyer at the august firm of Mitchell, Silberberg & Knupp.
His dad’s career allowed a teenage Rappaport to rub shoulders with the likes of Robert Evans, the producer of “The Godfather” and “Chinatown” and a legendary philanderer and party animal.
“I sort of grew up in Robert Evans’ screening room, and we’d go there on Friday and Saturday nights and meet the most interesting people on the planet.” Rappaport said. “A lot of them were talking about real estate and houses.”
Those conversations with the glitterati impressed on Rappaport that real estate didn’t have to be the domain of hucksters and has-beens but could be “another form of art or creative expression,” akin to selling an impressionist painting or modernist sculpture.
He began reading Ruth Ryon’s L.A. Times “Hot Property” column and put his baseball fanaticism to good use, memorizing addresses, prices and square footage as if they were batting averages.
“A lot of the kids I grew up around who came from privilege were not terribly motivated or evolved,” he said. “When I was in high school, I was 16 in Spago. All my friends were much older. I wasn’t going to keg parties.”
He wasn’t totally above a childish prank, though. Home after a tennis match at the age of 18, Rappaport received a phone call from KTTV Channel 11. The Panamanian dictator Manuel Noriega had just been captured and flown to the U.S. to stand trial, and the station, scrambling to put together a segment, was trying to reach the Panamanian consulate. Someone had misdialed.
Without missing a beat, Rappaport confirmed it was the consulate and that he was a certain “Arturo Valdez” from the USA-Panama Friendship Council. The station invited Rappaport on the air, and Rappaport bought a mustache that he applied to his face with Spearmint gum.
He appeared on TV, waved his arms around and spoke with an accent about what Panamanians thought of Noriega. “They see right through him, like a clear curtain,” he said on air. His stunt got him a writeup in the L.A. Times, which reported that other stations had inquired about booking him.
Recalling the prank today, Rappaport said, “I got more confident the further
I went.”
Fighting to the top
By 19, Rappaport had dropped out of USC, left an entry-level job at William Morris and got his real estate license. He started out as an agent at Merrill Lynch Realty in Beverly Hills, but when recalling those days, he exudes a palpable, almost primal disgust, comparing the high-pressure sales tactics he was taught to the desperate characters of “Glengarry Glen Ross.”
He quickly made his mark: By 22, a Times article noted his representation of Hollywood madam Heidi Fleiss.
“Kurt was a lot younger than me, but he knew a set of people I didn’t know,” said Victoria Risko, who partnered with Rappaport early in his career. “He also knew the properties because he grew up in Los Angeles.”
The two moved together to work for Fred Sands, perhaps L.A.’s premier luxury broker of the 70s and 80s. Sands’ “quotes and ideas could move real estate,” rival broker Mike Glickman told the Times.
But Rappaport viewed Sands as running a bloated outfit.
“The right hand didn’t know what the left hand was doing,” Rappaport said. “And no one could make a decision.”
The clash between the grizzled eminence and the brash upstart became hot industry gossip. Rappaport sued Sands, claiming an office administrator — who Sands was allegedly dating — kept asking Rappaport for confidential client information.
“I sued and I won,” Rappaport said. He was unhappy to retell the feud but made sure to note, “I later bought the building where Fred Sands was.”
“When I met Kurt, he was 25 going on 50, maturity wise,” Shapiro said. “He possessed an incredible knowledge of Beverly Hills. You could read off an address, and he could talk about the property and its history. And he worked his ass off.”
For his part, Rappaport admired Shapiro’s posse, which included Hard Rock Café founder Peter Morton and film producer Steven Tisch.
“His best friends were his clients,” Rappaport said. “He was kind of a version of what I was.”
By 1999, as Shapiro recalls, he was butting heads with Herman, who was moving into semi-retirement and wasn’t sure if agents really needed computers. Shapiro decided to bet on Rappaport, and the duo formed Westside Estate Agency. They decided on a dynamic that’s still in place today.
“I do the management,” Shapiro said. “He sells.”
The new establishment
How many blockbuster sales agents actually make, and what commissions they and their firms generate from those sales, is an inexact science. (Some brokerages self-report data to analytics firm Real Trends, though the data is not independently vetted, and Westside and other leading firms have declined to disclose their figures.
9388 Santa Monica Blvd.
Over the last three years, The Real Deal ranked the top L.A. agents by sales volume, meaning if an agent represents the seller of two $5 million home sales, they compile $10 million in sales volume.
In 2018, charting sales recorded on the Multiple Listings Service plus “off-market” deals verified by TRD, Rappaport ranked first with $627 million in sales volume. Chris Cortazzo of Compass placed second with $530 million in sales. For 2019, Rappaport was again first, with $513 million in deals, again followed by Cortazzo. (Cortazzo declined comment for this story).
This past year, TRD’s analysis was limited to deals in the first six months of 2020 recorded in the MLS. Rappaport was behind Cortazzo for on-market deals, but observers said he would take the top spot had his off-market deals been taken into account.
One such transaction is Jeffrey Katzenberg’s $125 million sale of his Beverly Hills home to WhatsApp co-founder Jan Koum, one of the five biggest-ever single-family home sales in California. Rappaport also advised David Geffen on a $34 million Beverly Hills land sale in November, after brokering a $68 million home buy for Geffen in June.
Another mega-client is DeGeneres, who has become a major luxury real estate player in Southern California. Rappaport claims to have done 25 deals with the talk show host. Rappaport warmly discusses these clients, and others like former CNN personality Larry King, who the agent sits with at Dodgers games, and former L.A. Mayor Antonio Villaraigosa. The clients, in turn, enthusiastically praise Rappaport.
“He is the consummate professional in every respect,” Villaraigosa said.
King said, “He’s been in the center of bringing and keeping the most powerful and fascinating people in our city.”
Haters hate
If you’ve been skimming this article to read Rappaport shit-talk rivals, here’s the best you’re going to get.
Rappaport on Jeff Hyland: “We’re just different. I don’t like speaking poorly about anyone.”
(Several messages with the normally chatty Hyland for this article went unreturned.)
Rappaport on deals about his properties he owns: “I was living in homes that other agents couldn’t even sell.”
Rappaport on how he’s seen by other agents: “We used to be in a world where people looked up to success.”
Asked their opinion of him, agents mostly took the high road.
“He may have the highest sales volume in L.A.,” said David Offer of Berkshire Hathaway HomeServices California Properties. “But there’s no way to really know for sure.”
Carl Gambino of Compass praised Rappaport as a mentor.
Jeffrey Katzenberg sold this Beverly Hills estate to Whatsapp co-founder Jan Koum, in a $125 million deal brokered by Rappaport
“He allowed me to step into his world,” Gambino said, “which helped me to become a better agent.”
For many agents, their beef with Rappaport isn’t that he’s No. 1 and says so. It’s that he takes his success so seriously.
Real estate is a second or third career for many. Risko was an astrophysicist. Branden Williams was an actor. Fredrik Eklund had a stint in porn. Stan Herman, Shapiro’s former business partner, was as well known for creating a backgammon club with Hugh Hefner as he was for selling.
In Los Angeles, being an agent can be more clubby than competitive. Success means starring in “reality” television shows, or heading teams of a few — or few dozen — agents at national brokerages. Rappaport views such pursuits as compromising client privacy and hurting sales.
Compass’ Ron Wynn once feuded with Rappaport over a Brentwood home sale but claimed he has nothing personal against him. Still, he said he feels Rappaport is too serious.
“Jade Mills [of Coldwell Banker] is approachable, light-hearted and cooperative,” Wynn said. “A very common thing is to have a price party. Get a bunch of people out and put what you think will be the price of the property in a hat. Jade will do that.”
Another agent put it this way: “I’ve heard brokers say I want to be Jade Mills. I haven’t heard that with Kurt.”
(Mills, like most agents, would not discuss Rappaport. She responded through a spokesperson: “Jade works extremely well with all brokers on behalf of her clients to help them achieve their real estate goals.”)
Family matters
Google “Kurt Rappaport” and images splash across the screen of him with Canadian fashion model Sarah Mutch. Rappaport married Mutch in 2017 in a star-studded wedding at his 15,000-square-foot Malibu mansion that was attended by P. Diddy, Ryan Seacrest and DJ Khaled. But less than two years later, Rappaport filed for divorce and sued Mutch for extortion. His scathing complaint was followed by a cross-complaint from Mutch and an eventual settlement for an undisclosed amount.
Rappaport was adamant about not discussing his private life. But Mutch’s cross-complaint bears mentioning, as allegations in it showcase Rappaport’s obsession with his work. Regarding the wedding, Mutch’s lawyers alleged that it “was just as much a business event as it was a wedding. The house they married was on the market for $100 million. Rappaport used the wedding to showcase this house to his wealthy client and friends.”
In early December, Rappaport suffered the loss of his son, Jake, who was 24. He declined to comment on the death, except to say, “Nothing matters except family and loved ones. Don’t ever take loved ones for granted. Spend as much time as you can with them.”
America’s pastime
Since meeting Ellison that day in Malibu, Rappaport has been periodically trying to transcend home sales.
Rappaport and Ellison eventually did 35 deals together. But beyond the hundreds of millions of dollars in sales volume and millions in commissions for Rappaport and Westside, Ellison meant something more: a true master of the universe who treated Rappaport as not just the guy to sell him a sun-filled mansion but a fellow creator of wealth.
“I explained to him my love for Malibu and why I thought it was undervalued compared to other coastal cities across the globe,” Rappaport said. He and Ellison “changed the pricing structure” of Malibu, bringing high-end shops, restaurants and hotels to a city where “the retail was surfboard and T-shirt shops.”
Rappaport’s quest to be more like the Ellisons and Geffens of the world can be a hard-to-define ambition. He has dabbled in some smaller commercial investments, including a Soho House-type club that has yet to be completed. But, there is one specific end goal — owning a Major League Baseball team.
He described becoming a baseball owner as, “having a seat at a private club with some very interesting people.”
In July, Rappaport said he wanted to buy the New York Mets. But as negotiations proceeded, Forbes reported that Rappaport had a net worth of just $250 million and warned he would need multiple business partners to make a deal work.
Come September, infamous hedge fund manager Steve Cohen — a Rappaport client — bought the Mets for $2.4 billion. Cohen, who was the inspiration for Bobby Axelrod in the hit Showtime series “Billions,” is worth at least $15 billion, according to Forbes. That makes him one of the wealthiest league owners, but it’s certainly a billionaires’ club. The Steinbrenner family, longtime owners of the New York Yankees, are worth $3.8 billion.
Rappaport would not discuss his net worth. When pressed, he waxed philosophical about how at his level of wealth, the specific amount of money doesn’t matter. Besides, he argued, he can assemble a team of rich friends to buy a baseball club — or anything else.
But Rappaport does have a regret: “I wish I had bought more.” His current and former portfolio includes two-dozen luxury properties in Beverly Hills, Bel Air, Malibu and Brentwood, including a Brentwood home he bought from former Viacom executive Frank Biondi in 2018 for $16 million and said he plans to move into later this year.
But Rappaport’s selling instincts can often clash with his desire to assemble and hold trophy properties.
“He often doesn’t build these homes in order to sell,” said Scott Mitchell, Rappaport’s architect on the Malibu house that sold to Katz. “Then someone comes along with a seductive number, and he can’t say no.”
How badly Rappaport would want to own a team is unclear. In 2009, Dennis Gilbert, agent to baseball stars of the 1980s and 90s, was the lead investor to buy the Texas Rangers with Rappaport an investment partner.
“We had a handshake agreement to buy the Rangers,” said Gilbert, now an adviser to Chicago White Sox owner Jerry Reinsdorf. “But the owner at the last minute decided to go into bankruptcy and we decided to pivot.”
The Rangers play in Arlington, on the outskirts of Dallas, and Rappaport was prepared to move to Dallas, seeing a real estate opportunity outside the Rangers’ ballpark.
Gilbert has vouched for Rappaport to owners like Reinsdorf. “He’s got the resources, and passion and business acumen,” Gilbert said.
“I wouldn’t see it as a hobby,” Rappaport said, “but a real business. A business that can be something of a love with a lot of interesting parts surrounding it, a media part, an entertainment part.”
When reminded that the Angelos family is rumored, again, to be selling the Baltimore Orioles, Rappaport nixed the idea of moving to Baltimore.
They do have a “great fan base,” he allowed.
Rappaport may buy some more property, or a baseball team, or something else. Or he might just spend another 25 years racking up hundreds of millions of dollars in mansion deals, alone at the top of a hill, staring at mountains.
Some real estate agents have begun using social media app Parler, where experts worry they’ll bump shoulders with far-right extremists. (Illustration by Paul Dilakian)
A few weeks after the election, Steve Martin Smith, a Florida-based RE/MAX broker, used his public Parler account to amplify a post by the far-right extremist group Proud Boys. The all-male, self-described “chauvinist” organization was promoting a march for President Donald Trump in Washington, D.C.
Thousands attended the Dec. 12 event, including anti-Trump protesters, and the demonstration devolved into violence. Four stabbings were reported in connection with the march, and Proud Boys chairman Enrique Tarrio said he participated in the burning of a “Black Lives Matter” banner pulled from a historic Black church.
Why Martin Smith promoted the Proud Boys’ post is unclear. He declined to be interviewed and switched his Parler account to private after being contacted by The Real Deal. Still, the agent, who has a weekly real estate podcast, is among millions of Americans drawn to Parler as the “premier free speech social network.” The platform has become popular among conservatives as an alternative to Twitter, which had begun fact-checking tweets by Trump and other Republican figures.
“It’s really hard to say you’re going to use it like any other social media platform. You’re known by the company you keep.”
But Martin Smith’s behavior on Parler illustrates a pattern on the app that concerns those who study extremism.
“Do [users like Martin Smith] think that event is legitimate because of Parler’s claim that it’s for conservatives, or do they actually support the Proud Boys?” asked Oren Segal of the Anti-Defamation League’s Center on Extremism.
Segal worries that Parler’s anti-censorship stance could allow extremist users to behave without limitations. For example, Proud Boys has been banned from Twitter since 2018 and from Facebook since June, but the group’s Parler account has more than 270,000 followers.
While that’s a red flag for an expert like Segal, it’s unclear if the real estate agents using Parler are aware of the controversy it has caused or its use by extremists. This could have unintended consequences for their real estate business, experts warn, particularly as the industry begins to crack down on agents’ online conduct. Parler did not respond to a request for comment.
“For some people who reject extremism and hate, to know that their real estate broker is advertising on a site that has extremists may call into question their judgment,” said Segal. “Whether that’s fair or not.”
Here to parley
Parler users who self-identify as agents are affiliated with a range of brokerages, among them Coldwell Banker, Berkshire Hathaway HomeServices, RE/MAX and eXp Realty.
Some say they say were drawn to the app after feeling alienated by mainstream social media like Twitter and Facebook. They’re not alone.
Parler, founded in 2018, became the most-downloaded app in the days after the 2020 presidential election. Many Trump supporters, including actress Kirstie Alley and former UFC fighter Tito Ortiz, recently adopted the platform, beckoning their millions of followers to join them. Other celebrities, including radio host and musician John Tesh, also jumped to Parler.
Phil Pennington, a Realtor based in Gibson, Arizona, created his Parler account after seeing people in his network on Facebook and Instagram make the move.
He said he believed in the idea of a social media platform “that is just a free exchange of community ideas without the comments that seem to be so divisive,” and was hopeful Parler might live up to that.
Other alternative platforms to see user bases grow this year include MeWe and Rumble. Parler functions a lot like Twitter, with 1,000-character posts known as “Parleys” and an “echo” function that amplifies other users’ posts. To see public conversations playing out in the app, users must sign up for an account and select whom to follow.
While Parler doesn’t officially brand itself as a platform for conservatives, newcomers to the app in November were welcomed by automated messages from Trump’s re-election campaign and former Rep. Ron Paul’s accounts. The platform is bankrolled by Rebekah Mercer, the daughter of conservative megadonor Robert Mercer.
One of Parler’s selling points is that it doesn’t moderate discussions, but instead relies on users to police each other. An account is deleted when it garners up to 20 “violation points,” which are determined by “a jury of your peers, not employees of Parler.” The app notes that sharing pornography, threats of violence or illegal activites are “contributing factors.”
But Segal is concerned that Parler users will not recognize and report extremist views. Much of the content that brings together extremists and moderates on Parler is centered around Trump and his claim that the election results were illegitimate.
Since the election, Parler has been used by far right activists and Trump supporters to jointly organize and participate in rallies such as the Million MAGA March and, most recently, the Proud Boys’ march. The overlap creates an opportunity for extremists to gain a larger audience among moderates over a shared cause without those users necessarily recognizing the extreme views a group may stand for, Segal explained.
“That’s ultimately the danger, when we don’t even know how to recognize the extremists in our midst,” said Segal. “Parler doesn’t seem to be trying to address that.”
Pennington said he doesn’t feel any more likely to run into extremist content on Parler than other platforms. “The same could be said about Instagram or Facebook,” he said.
Extremism and hate speech on major social media platforms have been rampant for years. But Facebook, YouTube and Twitter have increasingly cracked down on extremism, hate speech and disinformation on their platforms.
Despite his concerns, Segal stressed that Parler is far from becoming like the app Gab or the website Stormfront. Gab gained notoriety in 2018 for being where the shooter at Pittsburgh’s Tree of Life synagogue posted anti-Semitic rants and conspiracy theories before his deadly rampage. And a Klan leader founded Gab, which is considered the first major hate site on the internet.
“There are a lot of non-extremist users on Parler right now,” Segal said, adding that “it’s not always cut and dry the motivation behind someone who wants to be there.”
The bottom line
Several agents say they aren’t too concerned about a stigma being associated with the platform.
Christina Winters-Ronk, who owns her own firm in Oregon, joined Parler in February because she liked its commitment to free speech.
“If somebody were going to judge me based on having a social media account like Parler, I don’t know that I need them as a client.”
“That finger-pointing of hate is absolutely in the wrong direction,” she said, noting that she’s seen more inappropriate behavior and trolling on TikTok than Parler.
Winters-Ronk’s Parler posts are mostly personal, though she occasionally posts videos and photos of properties she’s selling.
For instance, she documented a recent trip she took to Washington, D.C., to participate in the Million MAGA March. In one photo she posted over the summer, she poses in a Trump hat next to a client’s poster for former Democratic presidential candidate Bernie Sanders.
Winters-Ronk said the photo was taken after she and her client realized they were on opposite sides of the political fence. She said posting a photo like that in jest was something she appreciated about Parler.
“Is it a social media platform that I feel like I could post something like that without backlash? Yes, absolutely,” she said. “Do I feel like that would be something censored on another site? Probably.”
“If somebody were going to judge me based on having a social media account like Parler, I don’t know that I need them as a client,” she added.
But while having a Parler account isn’t an endorsement of extremism and hate speech, some homebuyers and sellers may not care to make that distinction.
“It’s really hard to say you’re going to use it like any other social media platform,” said Jennifer White Karp, managing editor of Brick Underground, a consumer-focused real estate site based in New York. “I mean, you’re known by the company you keep.”
“I think one of the big concerns is that people [using Parler] could be more steeped in this ideology and become more indoctrinated, and it could affect how they work,” she added.
The industry’s largest trade group is increasing its effort to police agents’ behavior on social media. Last month, the National Association of Realtors broadened its Code of Ethics to cover not just a Realtor’s conduct while on the job, but in all manner of public life, including social media.
So far, NAR hasn’t fielded any complaints about agents’ conduct on Parler. But a spokesperson for the association noted that “the fact that Parler doesn’t impose such limitations on discriminatory speech doesn’t mean the Code doesn’t.”
Segal said how Parler deals with extremist users in the future will determine whether being associated with the platform will carry more of a stigma.
“In six months, we’ll see just how connected this platform is to extremism,” he said. “Then there won’t be any excuses.”
Gov. Gavin Newsom’s executive order to stem the spread of Covid-19 has effectively shuttered outdoor dining for nearly all restaurants in California (Getty, Google Maps)
A Sherman Oaks restaurant owner is suing to stop the statewide ban on outdoor dining, calling it unconstitutional and not backed by science, as Covid-19 cases continue to surge in California.
Angela Marsden, who owns Pineapple Hill Saloon & Grill, filed the federal lawsuit on behalf of Case Ventures, according to the Los Angeles Times. Her legal team includes noted attorney Mark Geragos, who also owns a restaurant in downtown L.A.
The suit comes as nearly 13,000 new coronavirus cases were reported on Tuesday in Los Angeles County alone, and as California is expected to extend its stay-at-home order through the holiday season.
Geragos called L.A. County “the world epicenter of Covid because science isn’t driving the government decisions; lobbyists are,” according to the Times. “Tragically, tens of thousands of small businesses are the ones who pay the price.”
On Dec. 8, a Superior Court judge tentatively struck down the county’s outdoor dining ban, saying it shouldn’t be allowed to continue indefinitely without a risk-benefit analysis to justify it. The California Restaurant Association had sued the county over the ban, an effort also led by Geragos. Judge James Chalfant called the countywide restaurant closure “an abuse of the department’s emergency powers” and one he said was “not grounded in science, evidence, or logic.”
But the outdoor dining ban continues, superseded by the governor’s statewide executive order concerning Covid restrictions. That kicks in when intensive care bed capacity at hospitals falls below 15 percent. Last week, ICU bed availability in Southern California reached 0 percent, according to the Times.
The order has been in effect since early December, with most of the state subject to it. Most retail businesses are limited to 20 percent of indoor capacity, while some businesses must close altogether, including hair and nail salons.
Marsden’s lawsuit noted that a movie production was allowed to continue near Pineapple Hill. The production included an outdoor tent where meals were provided to “a team of employees and contractors,” it said. The state has said movie production is essential business and could continue. [LAT] — Alexi Friedman
U.S. Department of Transportation nominee Pete Buttigieg has urban highways in his crosshairs.
The mayor of South Bend and former presidential candidate proposed changing federal policy that encouraged highways to cut through minority communities and have depressed property values ever since, Streetsblog reported.
“It’s disproportionately Black and brown neighborhoods that were divided by highway projects plowing through them because they didn’t have the political capital to resist,” Buttigieg told CNN’s Jake Tapper on Sunday. “We have a chance to get that right.”
Whether that means he will seek to dismantle some of those roadways remains to be seen. He tweeted Sunday that minority areas have been “divided by highway projects or left isolated by the lack of adequate transit and transportation resources.”
He added, “In the Biden-Harris administration, we will make righting these wrongs an imperative.”
Transportation for America and Third Way recommended this month that the new administration establish a $5 billion grant program for states to dismantle downtown expressways. They recommend that the land created would be held in a trust to be given to those displaced by the roadways.
Examples of such roadways in New York City include the Gowanus Expressway in Sunset Park and the Cross-Bronx Expressway. The latter — which laid waste to thriving blocks across the Bronx — is likely here to stay, as it has become the predominant truck route to and from the city. But proposals to tear down the Gowanus date back to the early 1990s.
Decking over the Brooklyn-Queens Expressway trench in Brooklyn’s brownstone neighborhoods to build housing and parks has also been floated.
In his new role, Buttigieg would manage 55,000 employees and an $87-billion budget — though some critics have questioned his ability to do so, given his limited experience.
Buttigieg will also have a key role in shaping the Biden administration’s multi-trillion dollar infrastructure bill next year that could remake the downtown core of cities to reduce the effects of climate change.
Rexford’s Howard Schwimmer and Michael S. Frankel with 2034-2040 East 27th Street (Google Maps)
Rexford Industrial Realty is filling out its holiday shopping list with a flurry of warehouse purchases.
In the latest, the industrial giant paid $93.8 million for a six-building warehouse portfolio in Vernon and $16.8 million for an outdoor storage yard in Santa Fe Springs, according to the Los Angeles Business Journal. Both were all-cash deals.
The purchases come a couple of weeks after the firm paid $129.4 million for four properties in the Inland Empire that total 632,000 square feet.
Brentwood-based Rexford’s acquisition in Vernon totals 464,000 square feet of buildings across 21 acres. The properties are: 1921-1931 East 27th Street (35,000 square feet); 2011-2025 East 27th Street (40,400 sf); 2031-2099 East 27th Street (98,300 sf); 2034-2040 East 27th Street (126,500 sf) 2750 South Alameda Street (63,300 sf); and 2800-2840 South Alameda Street.
The deal was the biggest in the Vernon submarket this year, according to Commercial Observer. The seller was Gautier Land Company. DAUM Commercial Real Estate Services represented Gautier in the deal.
Developed last year, the five-acre Santa Fe Springs location is located at 12211 Greenstone Avenue, according to the Business Journal.
Rexford has gobbled up about $1 billion in warehouse space in 2020, about what it spent last year. [LABJ, CO] — Alexi Friedman
Home purchase applications fell, thanks to high prices and low inventory.
Soaring home prices are now discouraging buyers more than low rates are motivating them.
An index tracking applications for mortgages to buy homes dropped 5 percent last week, seasonally adjusted, compared to the prior week, the Mortgage Bankers Association reported.
It’s the second time in three weeks that the metric, known as the purchase index, has dropped.
Joel Kan, MBA’s head of industry forecasting, attributed the recent slowdown in purchase applications to rising home prices as the inventory of available homes shrinks.
“There are still signs of relative strength in the housing market as 2020 ends. However,
housing affordability will be worth monitoring next year,” said Kan in a statement.
“The lower loan size segment of the market — particularly for entry-level and first-time buyers — continues to be impacted by rapidly increasing home prices and tight inventory,” he continued.
The average interest rate for a 30-year, fixed-rate mortgage was 2.86 percent, up from 2.85 percent the week before. Jumbo rates dropped to 3.10 percent from 3.12 percent.
MBA’s refinance index, which measures home refi applications, increased 4 percent, unadjusted, from the prior week and was up 124 percent year-over-year.
Refinancing activity made up nearly three-quarters of all applications MBA recorded in its weekly survey, which has been running since 1990 and covers 75 percent of the residential mortgage market.
MBA’s index tracking all home loan applications was up only 0.8 percent, however, as the refinancing increase was offset by the 5 percent drop from would-be homebuyers.
New home sales dropped across the U.S. again last month, as prices continue to rise.
There were 841,000 newly-built single-family homes sold in November, seasonally adjusted, according to the U.S. Census Bureau’s monthly report. That’s down 11 percent from the 945,000 sales made in October.
The Census Bureau’s report counts sales at the time contracts are signed, not closed, which makes the report a leading indicator of future transactions.
November is the third consecutive month that new home sales have slid compared to the prior month, but the rate of sales continues to report year-over-year gains. November sales were up nearly 21 percent from a year ago, when 696,000 homes were sold.
The same month-over-month decline while maintaining annual growth occurred across all regions, except in the Midwest. There, November sales dropped 24 percent year-over-year, while also dropping 43 percent from October’s numbers.
Prices continued to rise amid strong demand. The median sales price for new homes ticked up to $335,300, from $330,600 in October.
Low interest rates and the remote work revolution have helped propel the strong housing market, economists are beginning to express concern about the soaring prices that lock out first-time homebuyers.
Homebuilders are beginning to deliver new homes as construction reaches levels not seen since the 2007 bubble.
Inventory grew by about 3 percent by the end of the month with 286,000 new homes on the market from October. At the current sales pace, it would take 4.1 months for those homes to sell, up from 3.3 months of supply a month ago.
In a matter of two decades, Sam Nazarian went from Los Angeles nightclub king to luxury hotel mogul to ghost kitchen entrepreneur.
The founder and CEO of SBE Entertainment Group, one of the most influential companies in the lifestyle hospitality space, recently sold his remaining stake in the hotel business to go all in on digital restaurant brands.
It’s not the first time he’s bet on a budding industry. In the early 2000s, Nazarian took a chance when he opened a nightclub in West Hollywood, at the time an unfashionable neighborhood filled with warehouses. He then launched a string of hot spots that helped define the bottle-service and reality-TV party scene of the early millennium.
Just as Ian Schrager used his success in the club scene to create trendy boutique hotels, Nazarian moved into the hospitality space with the purchase of the Ritz Plaza in Miami Beach in 2004, which he transformed into the SLS South Beach.
The young mogul drew further comparison to the Studio 54 founder when he purchased Schrager’s Morgans Hotel Group in 2017, more than doubling SBE’s footprint and adding brands like the Delano and Mandarin Oriental.
Nazarian started with a leg up. His father, an Iranian refugee who fled the Islamic Revolution with his family and settled in L.A., is a billionaire who made an early investment in the tech giant Qualcomm. Now in his mid-40s, the younger Nazarian has grown out of his rich-kid persona and is moving on to the next phase in his career.
Just last month, he finalized a deal to sell his remaining 50 percent stake in his hotel business to his partner, the publicly traded French hospitality firm Accor. The cash- and asset-swap deal values the business at about $850 million.
Nazarian is now doubling down on what he sees as the next big thing and building out a new empire for his line of eateries, which includes Umami Burger, Krispy Rice and Plant Nation.
Born: July 22, 1975 Lives in: Coral Gables, Florida, and Bel Air, California Hometown: Born in Tehran; raised in Los Angeles Family: Married with two daughters, ages 4 and 2
What was the Los Angeles club scene like back in the early 2000s when you got started there?There was a falling off of a lot of strong [nightclub] owners. The scene was really controlled by four or five promotional groups.
When we started really looking, we’d go to Miami, New York and London and we’d come back to L.A. and it was just warehouses. It was pretty boring. It wasn’t a place I would say that was on the cutting edge of nightlife for entertainment by any stretch of the imagination.
Did you think it would be a multimillion-dollar business at one point, or was it just something you and your friends were having fun with? I was 25 or 26. My family and I started investing in some boutique hotels, and I really kind of fell in love with the dynamics of the boutique hotel space. My “aha” moment as I was investing in these hotels was when I realized there was just such a misalignment: The guy that was running the bar at our hotel was part of a completely different company than the onemanaging the restaurant. I started thinking to myself at that time, wouldn’t it be great to have a platform where all these verticals are under one roof, so [you don’t] have to pay fees to multiple operators as the equity guy?
Tell me about the first hotel you bought. It was the Ritz Plaza in Miami Beach [in 2004], which is now the SLS South Beach. Then we bought the Meridian Hotel here in Beverly Hills, and that ultimately became the first SLS hotel to open, in January 2009. Best time to open a hotel.
You just sold the remaining half of SBE’s hotel business, but that deal was put in place in 2018. What did you see back then that made you think to get out of hotels and double down on ghost kitchens and restaurants? In 2018, it was a perfect storm. I always felt the risk to what I was doing was not getting to scale. I’d seen a lot of great operators that just couldn’t get out of their own way. Ultimately, they got gobbled up by private equity or debt structures.
We acquired Morgans Hotel Group in January 2017, and it more than doubled our hotel footprint. But I also knew that as we were pivoting to the asset-light management model, we were still not big enough. The lifestyle category was now something that everybody was focusing on in the hospitality space.
The ghost kitchen space is really competitive. How do you plan to compete? One thing that separates us is that we own and create our own brands. By having up to 20 brands — and we treat every one of them like they’re Sweetgreen or Chipotle — we put in the marketing, the budgets, the social influencers, the digital media buys. We’re then able to cross-train our cooks to be able to cook the multiple brands at one time.
Really, the whole premise was to unlock the value of distressed real estate. It could be a restaurant that just went out of business. We’ve done now 42 leases during Covid, where we come into a restaurant that has been around and has the infrastructure. Unfortunately, their lease was up or they left, and we made a very compelling deal with the landlord.
Did you have any hesitation about getting out of hotels? Any second thoughts? You always have second thoughts. Especially with these brands — most of them I’ve created personally. But honestly, when we agreed to do this deal I was on the road 250 days a year. I was opening up offices in Singapore, London, Miami, New York, L.A. The pace was just exhausting. Having a young family, and getting the value that I got, I think was a win-win.
You converted some of your properties into distribution centers to help out something like 7,000 of your employees. Are you worried about how the Covid wave impacts their lives? This is probably the thing that keeps me up the most. A lot of those employees are now Accor employees, but in many cases they’re still part of my family. When this happened, it was the most devastating thing I’ve seen. And I’ve been through a couple cycles now. We still have close to 3,000 employees around the U.S., and a lot of them cannot come to work still. It’s scary.
You had considered taking SBE public at one point. Do you ever think about how things would be different now if you went through with that? There are a lot of benefits of being public, and there are a lot of downsides of being public. One thing being public does is it really gives you access to capital, it gives you access to debt, it gives you the ability of having liquid currency. I don’t regret it now.
Your family is from Iran, and they fled during the Revolution. Do you remember that time? I was so young, I don’t really have much of a memory of Iran at all. My earliest memories are us very hastily coming to this country. A lot of people were in the mindset that the Revolution was going to be short-lived, and everyone was going to be able to go back. It took a while for a lot of Iranians to accept the fact that this was going to be the new norm. Some of them never did.
My first memories are living in a hotel with my four siblings and my parents … and getting acclimated to a brand-new city, a new language, new schools. It was not easy, and I give the credit to my parents. My dad was born in the ghettos of Iran as a Jew in 1931. He built this whole life for himself and his family, and had to give it all up again when he was 49 years old. There’s a lot of heroic stories like that for me, a lot of the great wins that our community had that enabled a lot of people of my background to be successful.
Your father had a successful construction business. What did you learn from him? The only asset that enabled him to be successful again in another country was his reputation. It’s not an easy thing to do for an Iranian Jewish family coming to a new town and understanding a whole new culture: letting their daughters, as well as their sons, be as ambitious as they wanted to be. Those are the things I continue to learn from him.
How did you meet your wife [model Emina Cunmulaj]? I met my wife on holiday on Jan. 1, 2010. We happened to be in the same restaurant and we had a mutual friend who introduced us, and the rest is history.
You’ve been splitting your time between Miami and L.A. How many homes do you own? We have a home in Bel Air here in L.A. When I acquired Accor’s stake in the full-service restaurant business, I started spending a little more time here because that’s where that company was based out of. Also my parents are here, so I come and spend some time with them. I’m a Florida guy. We have a home now in Coral Gables. We had a home in Miami Beach before that, and I have a place in New York, in Tribeca, which we don’t really go to that often right now.
You have a couple of homes and a private jet. What’s the most extravagant thing that you’ve bought? I don’t think it’s extrav —I couldn’t function if I didn’t have a plane.
When I was younger, I was an idiot. I used to buy cars that were very extravagant, and I think that’s well documented. These days if I’m going to be extravagant, it’s more art. We’ll make an investment in art if my wife and I feel that it’s something that will have a good value proposition in the years to come. I’m kind of obsessed with that.
Now that I’m done with my SBE deal, if I am going to be extravagant I am looking at boats. I haven’t really put my finger on what kind of boat … but I’m definitely in the market looking for it.
I read about this habit you have of drinking Diet Cokes and smoking American Spirits. How did you pick those up? That’s something out of an old article, because in the last six years I haven’t had any soda whatsoever. Now mind you, it’s not like I’m the healthiest guy in the world, but I gave that up. I used to have like 10 or 11 Diet Cokes a day. I wasn’t drinking coffee back then, so maybe that was my caffeine option.
The smoking was the stupidest thing I picked up. Most people started smoking when they were 14 or 15; I picked it up at 21, 22, like an idiot.
Do you have any vices now? I love pasta. I love coffee. I love a good tequila. I love a nice bottle of wine and a good cigar. All the things that are good high quality, but nothing I would call a vice.
Back in 2014 the Vegas gaming board was looking into you and they found some drug use. You stepped down as president of the company at the time. How did that feel? I think it was unfortunate, because it was not the way in which it was depicted. It was a stupid, one-off occasion that happened a year prior to the hearing. But it made it seem like it was a much bigger problem than it was. Eight months later we were in talks to merge with Morgans and it was a blip, an unfortunate blip, but something you definitely learn from.
The other thing that came out of that was this extortion payment with Suge Knight. What happened there? It was just a stupid thing that typically you’ll find with guys that are high net worth. People in town will try to take advantage of people, and that’s all that was. I’ve never met Suge Knight and I’ve never been in a room with him, and that’s all in the past. I think I’ll let the record speak for itself.
I imagine that in the nightlife business, there’s a lot of sketchy situations and sketchy characters that you come in contact with. It’s not even just in the nightclub business. When you’re high-profile, you’re a target. I think that’s something that is just a reality of life. Especially today, more than ever, you have people that are willing to say and do whatever they need to, or threaten to get whatever they’re in it for, which 90 percent of the time is money.
You have this motto about how access is currency. How do [people] earn and spend that currency? The best table, the best bottle of wine, everybody wants some sort of opportunity to bypass the line, feel good about themselves. In many cases, that’s what hospitality people do, we’re in the business of making people feel good about themselves. Right or wrong, that’s just human nature.
What do you think about Joe Biden as the incoming U.S. president? I’m hoping we’re not focused every day on what the president’s doing, like we have been for the last four years. The thing I’m excited about is that the tone in the country just comes down. I’m generally a Republican, but if that’s what comes from this then I’m all for it.
What does your foundation focus on? In every market we went into, we worked very closely with families of fallen soldiers and the families of fallen police officers. My dad was a former officer, one of the first officers in 1948 in Israel, and it was something that always resonated with us. The other piece is inner-city youth.
My wife also has a tremendous foundation in her country. She’s from Montenegro, through her family actually. We build anywhere from 15 to 20 homes a year in Albania and some outskirts of Montenegro for families that are in dire straits and completely unable to do so for themselves. I’m very proud of what she’s doing.
You’re still pretty young. Where do you see yourself in 20 to 30 years? There are other businesses I’ve always been very curious to explore, and that I’ve done a tremendous amount of work on, that I see myself ultimately acting on in the next 20 years. I was not a hotel guy when I opened my first hotel in 2009, and now I’ve sold the business 11 years later. I still love looking around the corner.
Porch CEO Matt Ehrlichman (right), with Abu Dhabi Investment Authority veteran Thomas Hennessey (Ehrlichman via Porch, Hennessey via LinkedIn)
Porch.com gave an early Christmas present to its investors: The home-services startup will start trading on Nasdaq on Dec. 24 after its merger with a blank-check company was finalized.
The deal with Proptech Acquisition Corp. closed Wednesday, after shareholders approved the transaction at a special meeting held virtually on Dec. 21. After the vote, shares of the special-purpose acquisition company closed at $12.68, up 25 percent from July when the Porch deal was announced. At the time, the deal gave the startup an enterprise value of $523 million.
In a statement, Porch said it will receive $322 million in gross proceeds from the IPO. The deal includes a $150 million investment led by Wellington Management.
Steve Cohen’s Point72 Asset Management also invested in the company this month and now holds a 6.4 percent stake, regulatory filings show.
Founded in 2011, Porch provides software to home-services companies in exchange for data on their customers. Itthen sells other home services to those customers. To date, the Seattle-based startup has raised $120 million from investors including Valor Equity Partners, Lowe’s Cos., Founders Fund and Battery Ventures.
PropTech Acquisition Corp. was formed last year by Abu Dhabi Investment Authority veterans Thomas Hennessey and Joseph Beck. During an investor presentation in July, Hennessey said the SPAC evaluated 300 companies before striking a deal to take Porch public.
A subsequent IPO filing, however, shed light on Porch’s shaky finances.
A report by independent accountants cited recurring losses and raised “substantial doubt” about Porch’s ability to stay in business. The company had $3.8 million in cash as of June 30. It lost $49.9 million in 2018 and $103.3 million in 2019, and projected a $34 million loss in 2020.
Still, CEO Matt Ehrlichman defended the company’s finances in an interview with The Real Deal in October, noting that the SPAC merger would give Porch $200 million in cash and no debt.
“It gives us a significant war chest, which we can use to play offense,” he said. He said Porch became profitable in June with $7 million in EBITDA by holding research and development expenses flat. By growing its core business, Porch hopes to generate up to $500 million in annual revenue in five to seven years.
To get approval for the merger, Ehrlichman struck a deal with Valor, which agreed to approve the transaction in exchange for $9.5 million in shares, according to the IPO filing. Post-IPO, if Valor’s stake is valued at less than $44.2 million, Ehrlichman will make up the difference. He will also pay Valor $4 million in cash.
Ahead of its IPO, Porch also beefed up its C-suite, adding Matt Cullen, a former Expedia executive, as general counsel. It also hired Joshua Steffan, former COO of Home Bay, a home-buying platform, to lead Porch’s home inspection and real estate vertical.
SPAC deals made a huge comeback in 2020, as investors scrambled to capitalize on a strong market for tech stocks. With a week left in the year, SPAC Insider counted 247 SPAC IPOs in 2020, up from 59 in 2019.
One was Opendoor, the SoftBank-backed instant home-buyer, which began trading Monday after merging with Chamath Palihapitiya’s blank-check firm. Opendoor’s valuation tripled to $18 billion after the deal closed.
Charles Kushner, the Kushner Companies boss who spent over a year in prison on charges including falsifying tax returns, making illegal campaign donations and retaliating against a witness, received a pardon from President Donald Trump Wednesday, the White House announced.
The pardon has significant implications for Kushner Companies, as it may make it easier for the landlord to secure financing for its projects. Kushner’s conviction had been a complicating factor in the company’s ability to get loans, according to David Enrich, a New York Times journalist who authored a book about one of the firm’s biggest lenders, Deutsche Bank.
Kushner did not immediately respond to requests for comment.
Kushner spent 14 months in federal prison in Alabama before serving out the remainder of his sentence in a halfway house in New Jersey, and was released in March 2006. In an interview with The Real Deal the following year, he addressed the incident. “I believe that God and my parents in heaven forgive me for what I did, which was wrong,” he said. “I don’t believe God and my parents will ever forgive my brother and sister for instigating a criminal investigation and being cheerleaders for the government.”
According to its website, Kushner Cos. owns 17,000 apartments in New York, New Jersey, Maryland, Virginia and Tennessee. The Kushner family controls another 2,100 units in the East Village, Greenwich Village, Soho, the West Village, Brooklyn Heights and Williamsburg, as well as Northern Liberties, in Philadelphia. The firm’s president Laurent Morali told TRD last month that the company is interested in expanding its presence in New York City, and is also looking to acquire more apartments in suburban areas seeing a pandemic-induced surge of interest from investors and renters.
Others on the list of the 26 pardons issued by Trump Wednesday were Roger Stone, a longtime informal adviser to the president, and Paul Manafort, his 2016 campaign chairman.
In 2017, President Barack Obama pardoned nightlife impresario and hotel developer Ian Schrager, who was sentenced to prison for tax fraud in 1980.
Georgia Kromrei and Rich Bockmann contributed reporting.
Procore’s Tooey Courtemanche, REEF Technologies’s Ari Ojalvo, Pacaso’s Spencer Rascoff and Sonder’s Francis Davidson (Procore, CoMotion Miami, Getty, Sonder, iStock)
Some got bailouts, others got boosters — but across the board, proptech firms continued to reel in cash in 2020 as the pandemic forced the slow-to-adapt real estate industry to fully embrace technology.
As tech stocks led Wall Street’s recovery this spring, private investors also pulled out their checkbooks to fund hospitality startups and companies looking to digitize the home-buying process, from searches to securing titles.
SoftBank continued to double down on real estate tech. Other prolific investors included proptech-focused funds such as Navitas Capital and Zigg Capital, as well as generalist investors like Founders Fund and Greycroft.
All told, investors poured nearly $2 billion into the top 10 deals of the year, according to data compiled for The Real Deal by Pitchbook and the Center for Real Estate Technology and Innovation. Many were late-stage investments, and the average deal size was $198.7 million, according to the data.
Here’s the breakdown of the biggest deals:
1. REEF Technologies | $700 million
The biggest funding round of 2020 went to REEF Technologies, a Miami startup that turns empty parking lots into logistics hubs. In November, a syndicate including SoftBank and Mubadala Corp. invested $700 million, fueling REEF’s planned expansion from 4,800 to 10,000 locations. Founded in 2013, REEF provides hardware, software and management services to parking lot owners; more recently, it added cloud kitchens, healthcare clinics, last-mile delivery and experiential retail to its portfolio. Similar to WeWork, REEF leases real estate itself.
2. Pacaso | $267 million
Spencer Rascoff revolutionized the way people search for homes with Zillow. Now, he’s helping people find second homes with Pacaso, a startup he launched in September with CEO Austin Allison. Pacaso, which lets people buy from one-eighth to one-half of a vacation home, raised $17 million in equity and $250 million in debt, which it will use to purchase homes before quickly re-selling them. Investors include former Starbucks CEO Howard Schultz, Amazon exec Jeff Wilke and former Zillow exec Greg Schwartz.
Buoyed by heightened demand for digital home loans, Better.com raised $200 million at a $4 billion valuation in November, setting off rumors of a potential IPO in 2021. But behind the scenes, CEO Vishal Garg was ensnared in several lawsuits alleging financial mismanagement, Forbes reported. Garg’s former business partner, Raza Khan, also claimed that the CEO threatened to burn him alive. A Better.com spokesperson called the accusations “baseless.”
4. Sonder | $170 million
Despite the hospitality apocalypse unleashed by the pandemic, Sonder raised $170 million in June to scale its business — that is, leasing apartments and turns them into short-term rentals. The round valued the San Francisco startup at $1.3 billion, up from $1.1 billion. Despite a drop in business and layoffs, investors said the cash infusion was not a bailout. After Sonder’s bookings dropped in March, it secured rent reductions and pivoted to longer-term stays, avoiding the fate of rivals Lyric and Stay Alfred, which shuttered permanently because of the pandemic. Sonder has raised $560 million since 2012.
5. Procore | $150 million
After shelving a planned IPO this spring due to market volatility, construction startup Procore raised $150 million in the private market, securing a $5 billion valuation despite economic distress. Founded in 2002, Procore sells construction management software, with a client list that includes major developers and contractors, including Brookfield Properties and Turner Construction. In 2019, the company generated $289.2 million in revenue, but lost $83.1 million, according to regulatory filings.
6. States Title | $123 million
A flurry of startups is trying to streamline real estate closings, including States Title. The digital mortgage, title and escrow company, which was founded in 2016 by CEO Max Simkoff, raised $123 million in May from Greenspring Associations, Foundation Capital and FifthWall Ventures. That puts its valuation at $623 million. Historically, the title industry has been dominated by the so-called “Big Four”: Fidelity National, First American, Old Republic and Stewart. States Title is the biggest of the tech firms competing for the Big Four’s business.
7. Vacasa | $108 million
After weathering a steep drop in business and layoffs, vacation rental startup Vacasa nabbed $108 million in June from Silver Lake, the private equity firm that helped bail out Airbnb this spring. Based in Portland, Oregon, Vacasa handles bookings, housekeeping and customer service for investors who rent out their homes, in exchange for a 20 to 40 percent cut.
8. Homeward | $105 million
Home-buying startup Homeward secured $105 million to help buyers put their best foot forward. The Austin-based company, founded by Tim Heyl, a top agent at Keller Williams, raised $20 million in equity and $85 million in debt in May. The company loans prospective buyers money to make cash offers on their next home, and promises to buy their old home if they can’t sell.
9. LendingHome | $75 million
LendingHome, which makes fix-and-flip loans to real estate investors, raised $75 million in December to accelerate growth as more distressed properties hit the market. The round was led by Benefit Street Partners, and brings LendingHome’s total funding to $249 million, according to Crunchbase. The San Francisco-based startup, founded in 2013, also added Michael Bourque as CEO.
10. Orchard | $69 million
Orchard, a home-buying startup that allows owners to buy a new home before they sell their old one, raised $69 million in September to expand its offerings. The funding came eight months after the three-year-old startup nabbed $36 million. Formerly called Perch, the company added title, escrow and lending services this year. CEO Court Cunningham said the goal is to manage the entire home-buying process.
Donald Trump and niece Mary Trump (Peter Serling via Simon & Schuster, Getty)
Taking time out from issuing a blizzard of 11th-hour pardons, Donald Trump has asked a New York court to dismiss a case filed by his niece.
Mary Trump, who published a tell-all book about her uncle in July, claimed the president and his siblings fraudulently cut her out of the family’s real estate fortune. But in a filing Wednesday, the president said the matter was settled in 2001, Bloomberg News reported.
“Plaintiff makes outlandish and incredulous accusations in her complaint, which is laden with conspiracy theories more befitting a Hollywood screenplay than a pleading in a legal action,” the filing said. “Plaintiff even uses the thematic structure of a play to contrive a decades-long sinister plot in which she claims her aunt and uncles conspired with reputable lawyers, appraisers and other professionals to defraud her.”
Maryanne Trump Barry, the president’s sister, is also seeking to get the claims dismissed, stating in a separate filing that the younger Trump’s lawsuit “offers nothing more than conclusory allegations” that the Trump siblings “concealed the alleged fraud.”
“Her own public statements contradict any claim that she could not have discovered the alleged fraud years earlier,” the filing added.
Donald Trump’s father, Fred Trump Sr., died in 1999, leaving his estate to his four children. Mary Trump and her brother contested the will — their father, Fred Trump Jr., had died in 1981 — causing a standoff over medical coverage.
The parties reached a settlement in 2001, which Mary Trump claims was based on fraudulent valuations. The case continues.
CenterPoint Properties CEO Bob Chapman and the warehouse at 4180 190th Street in Torrance. (GI Partners, Google Maps)
No real estate sector has been bulletproof this year but the industrial market has shown the most resilience, with the surge in online orders leading to more logistics and warehouse leases.
In Southern California, where industrial has long been a bright spot, leasing remained strong in 2020. The latest example is a lease for 93,000 square feet at a Torrance warehouse, according to the Los Angeles Business Journal.
Landlord CenterPoint Properties Trust signed marketing and fulfillment company Regan Group to the deal at 4180 190th Street, according to the report. Regan Group had been subleasing nearly 30,000 square feet at the location. The new lease commits the company to the entire building.
Tyler Rollema and Matt Stringfellow of Klabin Company/Corfac International represented the Regan Group, while Newmark’s Barry Hill advised the landlord.
Illinois-based CenterPoint invests in industrial real estate across the U.S. Its holdings include 333 properties and 63 million square feet of space, according to its website.
Average asking rent for industrial space in the South Bay in the third quarter was 94 cents a foot. That’s about 6 cents higher than a year ago, the Business Journal reported, citing JLL figures.
In L.A. County overall, average industrial lease prices in the third quarter were up 2.2 percent year-over-year and vacancy was effectively flat.
Of the 10 largest industrial investment sales in L.A. County this year, .half involved institutional investors. Those included the Blackstone Group and Brentwood-based Rexford Industrial Realty, which acquired about $1 billion worth of warehouses in 2020.
It took about three months for Jon Paul Pérez to persuade his father to invest in the luxury apartment tower Wynwood 25 back in 2017.
The eldest son of Related Group founder and Miami “condo king” Jorge Pérez said last year that he negotiated the partnership with developer East End Capital “from soup to nuts.”
East End was looking for a strong partner with construction expertise, and it found that in Related.
Wynwood 25’s nearly 290 rental units and retail space were completed last year, marking the first major apartment project to be completed since the trendy neighborhood was rezoned about five years ago.
Jon Paul, who recently turned 36, has led Related’s charge in Wynwood, as well as its push into newer technology and amenities.
Last month, he became the company’s president, formalizing a succession plan that has been in the works for more than a decade. Jorge, the firm’s 71-year-old billionaire chair and CEO, has been stepping back over the years to focus more on his art collection and philanthropy.
Now, Jon Paul — who will remain surrounded by a group of longtime advisers — must step up to the plate during the pandemic, which has devastated local hotel, retail and restaurant owners while pointing up a greater need for affordable housing.
In short videos to his firm’s employees that began in March, he has reassured them that they will get through the months ahead, even reminding them to avoid using the office microwave and encouraging them to bring hot food in a thermos.
And as long as he can prove that Related is safe in his hands, Jon Paul stands to inherit one of South Florida’s largest and most influential development firms, one that Related Companies founder Stephen Ross has had a stake in since the start.
The development firm, which is rumored to have built one in four Miami condos, now has about 12,000 rental and condo units planned for next year. That includes at least half a dozen projects in a neighborhood that has seen property values explode in recent years.
Wynwood 25
On the condo front, Related is often the first to launch sales, the first to offer incentives when the market is saturated and the first to cancel a project when sales are lackluster. The company was also hit hard during the last recession, after many buyers walked away from their deposits.
Jorge has spoken about the importance of making “very cold” decisions about specific projects, and Jon Paul takes a similar approach, relying heavily on his financial background.
But while Jon Paul is expected to eventually take over entirely, it’s clear that his father still calls the shots for now, as he continues to run some company meetings. At the same time, all major investments must be approved by the Pérez family.
Matt Allen, Related’s executive vice president and COO, said late last year that the day Jorge is not at the company “is the day we put him in his grave.”
Like father, like son?
Jon Paul, also known as J.P., could be described as quieter than his dad, an outspoken art collector who has not shied away from rebuking President Donald Trump and his policies.
Jorge’s eldest son is just as exacting of people, though less aggressive than his father, according to those who know him well.
“He’s quiet and pensive, and when he speaks he has something intelligent to say,” said developer Gil Dezer, who partnered with Jon Paul on the high-end Residences by Armani Casa in Sunny Isles Beach. “He doesn’t go out and give opinions to people he doesn’t necessarily know, which is smart.”
Dezer also said that Related runs like a “great machine” and would be successful regardless, adding that Jon Paul will lead the company “very well.”
Related — which Jorge founded in 1979 with Ross — has been active in developing luxury condos, affordable and market-rate housing, mixed-use projects and office buildings. The firm has also expanded throughout Florida, doubling down on Tampa, as well as the Southwestern U.S., and has projects in Latin America, where Jorge was born.
And Related isn’t showing signs of slowing down. Construction has continued on its existing projects, and this fall Related launched sales at Solemar, a luxury condo tower planned for Pompano Beach. This month, the company also closed with Dezer Development on a site in Hillsboro Beach where the two firms plan to build luxury condos.
Succession is likely one of the most important decisions a founder makes, said Ezra Katz, founder and CEO of Aztec Group, an investment and merchant banking firm based in Miami’s Coconut Grove. The earlier a plan is set into motion, the better, and to “think you’re invincible and immortal is not an option,” he noted.
“It’s a touchy subject. It’s not a good idea to demand it. It has to be a natural process,” Katz said. “I can cite many situations where the children of the family members didn’t want to be part of the family business.”
Though Jon Paul differs from his father in some ways, he isn’t less direct, decisive or demanding than Jorge, said Related Vice Chair Adolfo Henriques. He’s been described as a “firecracker,” and he and his father are both Type-A personalities, said Henriques, adding that Jon Paul is open to other opinions but has his own and is far from soft-spoken.
Both Jon Paul and his father declined to be interviewed for this story, due to timing.
Jon Paul’s work life and home life started on the same page. He and his younger brother Nicholas, now a vice president at Related, would often visit sales centers and properties on weekends with their dad.
“Both Jon Paul and Nick have been intimately involved in [the business] their entire lives,” Henriques said. “It’s just kind of intrinsic. It’s built into how they think.”
Jon Paul got his start in 2008, working for Related Companies President Bruce Beal just before the financial crisis hit. After graduating from the University of Miami, he left his hometown to work for Related Companies in Manhattan. Getting outside experience was a requirement if he were to come back and work for Related Group.
“I was Jorge’s son but I was not treated like that in New York,” Jon Paul told The Real Deal in a 2014 interview. “That was the best thing for me.” As Jon Paul takes more control over the company, especially during a pandemic, the people he surrounds himself with will be crucial to his success, according to observers on the outside.
“It’s going to be critical for Jon Paul not to let the real estate industry blow smoke up his ass because if he buys into that, it will be a disaster,” said condo market consultant Peter Zalewski, who has consulted for Jon Paul.
“He needs the Matt Allens of the world and others who are going to give him straight talk and not fall for the real estate hyperbole and bullshit the industry is renowned for in Miami,” Zalewski added. (Allen has worked for the firm since 1999.)
His generation
Jon Paul is part of a younger breed of real estate developers, many of whom he’s partnered with in recent years. That group includes the junior Dezer, Terra Group’s David Martin and Brett Mufson of Fontainebleau Development.
Many of them, like Jon Paul, cut their teeth during the last recession.
“Jon Paul has been able to take real estate friendships and convert them into successful joint venture partnerships,” said Scott Wadler, managing director in the Miami office of Berkadia, a capital markets advisory firm co-owned by Berkshire Hathaway and Jefferies Financial Group.
Wadler, a friend of Jon Paul’s, is listing Related and Block Capital’s Domio Wynwood, an apartment-hotel hybrid that hit the market a few months ago. Inside Related, Jon Paul is busy looking for the hustlers who have the drive to succeed and wear multiple hats.
“He’s very focused on finding the stars who are going to bring in business and development opportunities,” Wadler noted.
Though he isn’t politically outspoken like his father, a longtime Democrat, Jon Paul is finding his own place in South Florida. He’s a member of the Wynwood Business Improvement District board and sits on the Urban Land Institute’s Southeast Florida/Caribbean advisory board.
Albert Garcia, the BID’s chair, said Jon Paul’s approach to developing in the neighborhood — which included a massive mural on the northeast side of Wynwood 25 by artist El Mac — alleviated “a lot of the anxiety” that surrounded Related’s expansion plans in the neighborhood.
Armani Casa in Sunny Isles Beach
“I think he understands the role that individual projects play,” Garcia said. “This is not going to become Brickell, this is not going to become Miami Beach.”
The new guard
The pandemic disrupted many things, but not Jorge Pérez’s succession plan.
“Jorge had a timespan during which he just wanted Jon Paul to experience things a little differently,” said Henriques, who advises on Related’s executive team, which Jon Paul has been a part of for years.
Jon Paul worked under former condo development president Carlos Rosso, who recently left the company after working for Jorge for 18 years, and briefly for Jon Paul. For Rosso, it was time to move on, though he will continue to work with the company on specific projects.
Henriques said that Jon Paul got his start at Related Group working under the division heads as one of their employees. “Transitioning from being an employee to being the boss requires changes in behavior, changes in relationships. The pandemic helped to cement some of those changes,” he said.
It’s important to give the next leader in a family firm the chance to make mistakes, own up to them and learn from them, said Katz of Aztec Group. How he or she relates to administrative staff and other company executives is also key.
“A lot of people simply don’t know how to stand up and say, ‘It’s on me,’” Katz noted. “To lead a company is a totally different ballgame. Some do it well and some don’t.”
With loans coming due and developers scrambling for cash, private credit funds are gearing up for a busy year. (Getty)
With real estate loans coming due and developers scrambling for cash, private credit funds are gearing up for a busy year.
More than $400 billion in commercial and multifamily debt is maturing in 2021, according to Bloomberg. Without fresh capital to survive the pandemic, owners of distressed property face default.
The predicament for owners creates an opportunity for private lenders to buy up loans and offer new debt.
“In the last 90 days, I’ve had lots of dialogue directly with banks and debt funds in terms of loan sales,” Josh Zegen of Madison Realty Capital told Bloomberg. “We’ve executed on some of it, but I see a lot more going into the first and second quarters of 2021.”
Commercial real estate deals plunged this year as the hotel, office and retail markets struggled to gain momentum following the initial jolt of the pandemic.
Russell Gimelstob, chief executive officer of Los Angeles–based Ascendant Capital Partners, told Bloomberg that offering new debt for distressed properties can bring in returns of between 10 percent and 12 percent.
Buying distressed properties directly could bring higher returns, but those deals are rarer, for now, as lenders work with owners on finding solutions.
That could all change.
“We think equity and real estate trades are going to be more prevalent when the runway ends,” Gimelstob said.
Photo illustration by Alexis Manrodt for The Real Deal (Getty, iStock)
It was the fall of 2017 and Los Angeles City Council Member Jose Huizar needed a word with a longtime staffer about two real estate projects pending before the council.
In advance of hearings, Huizar wanted to make sure the projects’ developers had funneled thousands of dollars to a fund set up to elect Huizar’s wife, Richelle Huizar, as his successor.
“All commitments have been made,” his staffer, George Esparza, assured him.
The exchange was one of many startling details in the 138-page superseding indictment of Huizar that federal prosecutors handed down Nov. 30.
The filing brought new criminal counts against Huizar and also Shenzhen New World Group, its chairman Wei Huang, Los Angeles builder Dae Yong Lee and the Lee-incorporated 940 Hill LLC.
But questions remain about the Huizar probe, which has lasted more than two years and produced an array of indictments, plea deals, and tales of pay-to-play for Katy Perry tickets.
Notably, it’s unclear what other real estate executives and companies will face charges. The latest indictment alludes to 14 companies.
As Donald Rumsfeld might put it, here are the known knowns, known unknowns, and an unknown unknown of the investigation.
Known Knowns
Huizar has gone from chair of the council’s powerful planning committee, to just downtown council member, to termed-out member facing 41 criminal counts of racketeering, fraud and money laundering. Huizar has pleaded not guilty to all charges and faces a June trial.
Dae Yong Lee, 940 Hill LLC and Ray Chan, former deputy mayor of the economic development office, have also pleaded not guilty to federal racketeering charges. Shenzhen New World Group and its chairman Wei Huang, who resides in China, await arraignment.
A handful of people have been identified as supplying information to the FBI through plea deals announced by federal prosecutors. These include Esparza, who pleaded guilty to a racketeering charge in May and graces no fewer than 52 of the latest indictment’s 138 pages. Others who made deals with prosecutors include real estate consultant George Chiang, appraiser Justin Jangwoo Kim, lobbyist Morris Goldman, and former City Council Member Mitchell Englander.
Developer Shenzhen Hazens has paid a $1 million fine and admitted to wrongdoing.
Known Unknowns
The indictment lists three companies that gave $25,000, $50,000 and $50,000, respectively, to the political action committee to elect Richelle Huizar.
Two of those companies appeared before either the council’s Economic Development Committee or Planning, Land Use and Management Committee on Oct. 24, 2017.
A “Company I” had a project outside Huizar’s district and needed approval for signage, which might connect to an item on the planning agenda.
“Company H,” meanwhile, sought a “transient occupancy tax rebate,” perhaps taken up during the economic development meeting.
An LLC seeking a hotel tax break at that meeting was incorporated by the Choice Hotel franchise. But a Choice company spokesperson said, “Choice is not a party to this project,” adding, “That said, we are confident that the venture’s development activities have been conducted in compliance with all applicable laws.”
Also unknown is whether the FBI views these companies as co-conspirators or if they are already cooperating with prosecutors.
The Huizar scandal concerns allegations that companies paid off the council member. But, as Neil McCauley once said, there’s a flip side to that coin: Whether any developers failed to get projects approved because they didn’t bribe Huizar.
The indictment refers to a China-based developer, “Company G,” that Esparza slams for not giving money to the Richelle Huizar PAC.
“[Company G] has not come through with any commitments to us,” Esparza said during a May 2017 phone call. “So … let’s just continue to ignore them, you know. We are not going to help them.”
Shortly after the FBI raided Huizar’s office in November 2018, the Los Angeles Times reported that real estate and billboard companies were solicited by Richelle Huizar to donate money to Jose Huizar’s former school, Bishop Mora Salesian High School in the Boyle Heights neighborhood.
The Times reported that Shanghai-based Greenland gave $25,000 to the school, and New York City-headquartered Related Companies provided $10,000.
The indictment mentions a China-based Company L that gave $25,000 to the high school — perhaps Greenland, which has acknowledged donating. But it also alludes to a different Chinese business, “Company K,” that gave $25,000.
Unknown is what the second Chinese company might be and why it is mentioned in the indictment. Also, unknown is whether Greenland figures into the probe beyond the single donation.
A “Company M” in the indictment appears to be Carmel Partners, a San Francisco-based developer. But after an initial statement in July, Carmel has not discussed its involvement in the Huizar scheme. Will the firm avoid criminal prosecution? Is it working on a deal similar to Shenzhen Hazen’s?
Unknown Unknown
U.S. attorneys serve at the pleasure of the president, and L.A.’s is Nicola Hanna, a Donald Trump appointee. No one knows if Hanna is pushing to wrap up the case before President-Elect Joe Biden replaces him.
But Hanna’s latest public statements suggest that the Huizar probe is not just about the council member and a few rogue companies.
“This detailed indictment,” Hanna said in a statement, “should prompt a serious discussion as to whether significant reforms are warranted in Los Angeles city government.”
Manhattan district attorney Cy Vance, Paul Manafort, and President Donald Trump (Getty)
Manhattan’s district attorney is moving forward with his effort to prosecute Paul Manafort on mortgage fraud charges after President Donald Trump pardoned his former campaign chairman Wednesday. The case is likely to test a law New York passed last year to close the “double jeopardy loophole” for presidential pardons.
District Attorney Cy Vance’s office said it is continuing its attempt to appeal a ruling from last December in which a New York judge threw out its fraud charges against Manafort.
Judge Maxwell Wiley ruled that the prosecutor couldn’t bring those charges against Manafort, who at the time was serving a 7 ½-year prison sentence after being convicted in federal court in 2017 on charges relating to his business dealings. This October, an appellate court upheld that ruling.
Trump granted clemency to Manafort, citing “blatant prosecutorial overreach” in the case, but Vance’s office said it is not letting Manafort off the hook.
“This action underscores the urgent need to hold Mr. Manafort accountable for his crimes against the people of New York as alleged in our indictment, and we will continue to pursue our appellate remedies,” Vance spokesperson Danny Frost said in a statement.
Manafort’s defense attorney could not be immediately reached for comment.
The former campaign chairman had been released from prison in May because of coronavirus concerns.
Vance filed a 16-count indictment against Manafort in March 2019 that included allegations he deceived banks in order to get a loan on Soho condominium at 29 Howard Street in Manhattan.
The charges came on the same day a federal judge increased Manafort’s prison sentence and were largely seen as a hedge in case Trump issued a pardon.
In October of last year, New York state Democrats passed a law to close the “double jeopardy loophole,” to allow the state to prosecute people for state crimes after they have received presidential pardons, but it’s not clear how that will affect Manafort now.
Dmitriy Shakhnevich, a constitutional law professor at the John Jay College of Criminal Justice, said that if prosecutors move forward with a case against Manafort, it’s likely the state’s new law will be called into question.
“It will be challenged for sure if there’s any state prosecution under this law,” he said.
Despite recurring losses, Porch was valued at $1.1 billion on its first day of trading. (Porch, Getty)
After merging with a blank-check company, Porch.com is now a billion-dollar company.
Despite recurring losses — which prompted accountants to raise red flags in the company’s IPO filing — the home-services startup made its stock market debut on Nasdaq today, with shares opening at $15.37.
Even before the opening bell, Porch’s valuation soared to more than double its enterprise value of $523 million in July, when it struck a deal to go public.
The company’s merger with PropTech Acquisition Corp. closed on Wednesday. The special-purpose acquisition company was formed last year by Thomas Hennessy and Joseph Beck, former Abu Dhabi Investment Authority execs. After trading around $10 per share for several months, the SPAC’s stock jumped nearly 25 percent after shareholders approved the Porch merger on Dec. 21.
Based on Porch’s opening stock price, Ehlichman’s 24.8 percent stake is now worth $266.4 million on paper. Hennessey and Beck each hold a 6 percent stake worth $64.4 million.
Prior to the IPO, Porch had raised $120 million from investors including Valor Equity Partners, Lowe’s Cos., Founders Fund and Battery Ventures.
In the company’s IPO filing, it said it generated $77.6 million in 2019, up from $54.1 million a year prior. But its losses also widened, to $103 million in 2019 from $49.9 million in 2018. The company’s recurring losses raised red flags for accountants, who expressed “substantial doubt” about its viability.
But in an October interview, Ehrlichman said the IPO would give it a clean slate, and that the company became profitable in June of this year. Porch hopes to generate up to $500 million in revenue in five to seven years by growing its core business.
The company said it received $322 million in gross proceeds from the IPO, including a $150 million investment led by Wellington Management. Other investors include Scopus Asset Management and Steve Cohen’s Point72 Asset Management, which acquired a 6.4 percent stake that’s now valued at $17 million.
What was the Los Angeles club scene like back in the early 2000s when you got started there?
