Paul Reichmann
Encyclopedia
Paul Reichmann is a Canadian businessman best known for his leadership of the Olympia & York a real estate development company.
in 1930 to Samuel Reichmann, a wealthy egg
merchant and his wife René. His parents were Orthodox
Jews from a small town in Hungary
, but his father had risen to prominence in Vienna as a successful merchant.
The family escaped the Nazi
occupation of Austria
by sheer chance, as they happened to leave the country on the day of Anschluss
, to visit Paul's grandfather in Hungary
who had suffered a stroke
. Abandoning their lives in Vienna, they made their way from Hungary to Paris
, where they settled. The Reichmann family fled when France
fell to the Germans, eventually making their way to the neutral city of Tangier
.
In Tangier, the family prospered as Samuel became a major currency trader. After the war Paul left home to study religion first in Britain and then in Israel
, and became a Rabbi
. In 1953 he returned to Morocco
to become a shirt retailer, and that same year he married Lea Feldman.
in Canada
. Edward had established a successful flooring
and tile company in Montreal
. Paul, along with his brothers Albert
and Ralph, moved to Toronto
to set up a branch of the flooring and tile company in that city.
Unsatisfied with the local builders, Paul Reichmann decided the company would construct its own warehouses and offices. Soon the company was building such facilities for others. In 1964, Olympia and York
was founded as a separate building and property development firm.
The firm was soon profitable, and expanded rapidly. It also accepted difficult projects, including the construction of First Canadian Place
, Canada's tallest building, in 1976. The company expanded to New York
and Tokyo
and by the mid-1980s it was the largest developer in the world, and the Reichmanns were one of the world's richest families.
His success had little impact on Paul Reichmann's lifestyle. He remained very private and unwilling to talk to the press. He retained his strong religious
views, and used much of his fortune to support his religion. In Toronto he built a number of schools and synagogue
s which became the centre of a thriving Orthodox community. Shunning most luxuries, his one personal indulgence was a collection of rare and valuable Jewish texts. Pursuant to Jewish law, all of Olympia and York's construction projects halted on the Jewish Sabbath
and all holy days.
project. It was the world's largest property development, but remained half empty. Reichmann had taken the project as a major gamble. He had been impressed by Margaret Thatcher
's reforms and obtained a personal promise from her that she would help the project, most importantly by extending the London Underground
to reach it.
In Canada, Reichmann's once sterling reputation also began to suffer. In 1985 the company had bought Gulf Canada in a deal that included some $300 million in tax breaks. Many Canadians were infuriated that a massive corporation had been given such a lucrative deal. Toronto Life
magazine also published a highly critical article on the Reichmanns. The family took offence at allegations that Samuel Reichmann had aided the Nazis with illegal smuggling operations during the Second World War. The family sued the magazine for an unprecedented $109 million. They were successful, and Toronto Life published a full retraction, but their heavy fisted response soured many in the Canadian media to the Reichmanns.
In 1992, Olympia and York collapsed under some $20 billion in debt
. Paul Reichmann lost most of his family fortune.
, Lawrence Tisch and Michael Price
along with investors such as Saudi Prince Al-Waleed
to purchase a controlling stake in the Canary Wharf from the banks that made the original construction loans to Reichmann and which had taken control of the development. Reichmann became Chairman of Canary Wharf again and remained so until 2004.
During 2004 a takeover battle began for the Canary Wharf Group in which Reichmann eventually sided with Canadian developer Brascan to attempt a purchase of the company. During this process he resigned his position on the Board. In March, 2005 a consortium of investors led by Morgan Stanley under the banner of Songbird Estates purchased Canary Wharf Group, and Reichmann was therefore no longer involved with Canary Wharf on a day to day basis. Reichmann, at the time 75, announced that he intended to retire from business and sold many of his property holdings.
Formative years
Reichmann was born in ViennaVienna
Vienna is the capital and largest city of the Republic of Austria and one of the nine states of Austria. Vienna is Austria's primary city, with a population of about 1.723 million , and is by far the largest city in Austria, as well as its cultural, economic, and political centre...
in 1930 to Samuel Reichmann, a wealthy egg
Egg (food)
Eggs are laid by females of many different species, including birds, reptiles, amphibians, and fish, and have probably been eaten by mankind for millennia. Bird and reptile eggs consist of a protective eggshell, albumen , and vitellus , contained within various thin membranes...
merchant and his wife René. His parents were Orthodox
Orthodox Judaism
Orthodox Judaism , is the approach to Judaism which adheres to the traditional interpretation and application of the laws and ethics of the Torah as legislated in the Talmudic texts by the Sanhedrin and subsequently developed and applied by the later authorities known as the Gaonim, Rishonim, and...
Jews from a small town in Hungary
Hungary
Hungary , officially the Republic of Hungary , is a landlocked country in Central Europe. It is situated in the Carpathian Basin and is bordered by Slovakia to the north, Ukraine and Romania to the east, Serbia and Croatia to the south, Slovenia to the southwest and Austria to the west. The...
, but his father had risen to prominence in Vienna as a successful merchant.
The family escaped the Nazi
Nazism
Nazism, the common short form name of National Socialism was the ideology and practice of the Nazi Party and of Nazi Germany...
occupation of Austria
Austria
Austria , officially the Republic of Austria , is a landlocked country of roughly 8.4 million people in Central Europe. It is bordered by the Czech Republic and Germany to the north, Slovakia and Hungary to the east, Slovenia and Italy to the south, and Switzerland and Liechtenstein to the...
by sheer chance, as they happened to leave the country on the day of Anschluss
Anschluss
The Anschluss , also known as the ', was the occupation and annexation of Austria into Nazi Germany in 1938....
, to visit Paul's grandfather in Hungary
Hungary
Hungary , officially the Republic of Hungary , is a landlocked country in Central Europe. It is situated in the Carpathian Basin and is bordered by Slovakia to the north, Ukraine and Romania to the east, Serbia and Croatia to the south, Slovenia to the southwest and Austria to the west. The...
who had suffered a stroke
Stroke
A stroke, previously known medically as a cerebrovascular accident , is the rapidly developing loss of brain function due to disturbance in the blood supply to the brain. This can be due to ischemia caused by blockage , or a hemorrhage...
. Abandoning their lives in Vienna, they made their way from Hungary to Paris
Paris
Paris is the capital and largest city in France, situated on the river Seine, in northern France, at the heart of the Île-de-France region...
, where they settled. The Reichmann family fled when France
France
The French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France...
fell to the Germans, eventually making their way to the neutral city of Tangier
Tangier
Tangier, also Tangiers is a city in northern Morocco with a population of about 700,000 . It lies on the North African coast at the western entrance to the Strait of Gibraltar where the Mediterranean meets the Atlantic Ocean off Cape Spartel...
.
In Tangier, the family prospered as Samuel became a major currency trader. After the war Paul left home to study religion first in Britain and then in Israel
Israel
The State of Israel is a parliamentary republic located in the Middle East, along the eastern shore of the Mediterranean Sea...
, and became a Rabbi
Rabbi
In Judaism, a rabbi is a teacher of Torah. This title derives from the Hebrew word רבי , meaning "My Master" , which is the way a student would address a master of Torah...
. In 1953 he returned to Morocco
Morocco
Morocco , officially the Kingdom of Morocco , is a country located in North Africa. It has a population of more than 32 million and an area of 710,850 km², and also primarily administers the disputed region of the Western Sahara...
to become a shirt retailer, and that same year he married Lea Feldman.
Rising success
Three years later Paul left Morocco to join his elder brother EdwardEdward Reichmann
Edward Reichmann was the oldest of the five Reichmann brothers, famed for their global business empire.Edward was born to Samuel Reichmann a wealthy Vienna merchant of Hungarian origin. The family was lucky to escape Austria before the Nazi invasion leaving the country on the morning of Anschluss...
in Canada
Canada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
. Edward had established a successful flooring
Flooring
Flooring is the general term for a permanent covering of a floor, or for the work of installing such a floor covering. Floor covering is a term to generically describe any finish material applied over a floor structure to provide a walking surface...
and tile company in Montreal
Montreal
Montreal is a city in Canada. It is the largest city in the province of Quebec, the second-largest city in Canada and the seventh largest in North America...
. Paul, along with his brothers Albert
Albert Reichmann
Albert Reichmann was one of the five brothers that controlled the Reichmann business empire.-Life:Albert joined his brothers Paul and Ralph in Toronto...
and Ralph, moved to Toronto
Toronto
Toronto is the provincial capital of Ontario and the largest city in Canada. It is located in Southern Ontario on the northwestern shore of Lake Ontario. A relatively modern city, Toronto's history dates back to the late-18th century, when its land was first purchased by the British monarchy from...
to set up a branch of the flooring and tile company in that city.
Unsatisfied with the local builders, Paul Reichmann decided the company would construct its own warehouses and offices. Soon the company was building such facilities for others. In 1964, Olympia and York
Olympia and York
Olympia & York was once a major international property development firm based in Canada. The firm built major financial office complexes like Canary Wharf in London, the World Financial Center in New York City and First Canadian Place in Toronto...
was founded as a separate building and property development firm.
The firm was soon profitable, and expanded rapidly. It also accepted difficult projects, including the construction of First Canadian Place
First Canadian Place
First Canadian Place is a skyscraper in the financial district of Toronto, Ontario, Canada, at the northwest corner of King and Bay streets, and is the location of the Toronto headquarters of the Bank of Montreal. At , it is Canada's tallest skyscraper and the 15th tallest building in North America...
, Canada's tallest building, in 1976. The company expanded to New York
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...
and Tokyo
Tokyo
, ; officially , is one of the 47 prefectures of Japan. Tokyo is the capital of Japan, the center of the Greater Tokyo Area, and the largest metropolitan area of Japan. It is the seat of the Japanese government and the Imperial Palace, and the home of the Japanese Imperial Family...
and by the mid-1980s it was the largest developer in the world, and the Reichmanns were one of the world's richest families.
His success had little impact on Paul Reichmann's lifestyle. He remained very private and unwilling to talk to the press. He retained his strong religious
Religion
Religion is a collection of cultural systems, belief systems, and worldviews that establishes symbols that relate humanity to spirituality and, sometimes, to moral values. Many religions have narratives, symbols, traditions and sacred histories that are intended to give meaning to life or to...
views, and used much of his fortune to support his religion. In Toronto he built a number of schools and synagogue
Synagogue
A synagogue is a Jewish house of prayer. This use of the Greek term synagogue originates in the Septuagint where it sometimes translates the Hebrew word for assembly, kahal...
s which became the centre of a thriving Orthodox community. Shunning most luxuries, his one personal indulgence was a collection of rare and valuable Jewish texts. Pursuant to Jewish law, all of Olympia and York's construction projects halted on the Jewish Sabbath
Shabbat
Shabbat is the seventh day of the Jewish week and a day of rest in Judaism. Shabbat is observed from a few minutes before sunset on Friday evening until a few minutes after when one would expect to be able to see three stars in the sky on Saturday night. The exact times, therefore, differ from...
and all holy days.
Troubles
The company ran into severe trouble in the early 1990s. It was due in part to a general decline in the world economy, but the company was truly brought low by the Canary WharfCanary Wharf
Canary Wharf is a major business district located in London, United Kingdom. It is one of London's two main financial centres, alongside the traditional City of London, and contains many of the UK's tallest buildings, including the second-tallest , One Canada Square...
project. It was the world's largest property development, but remained half empty. Reichmann had taken the project as a major gamble. He had been impressed by Margaret Thatcher
Margaret Thatcher
Margaret Hilda Thatcher, Baroness Thatcher, was Prime Minister of the United Kingdom from 1979 to 1990...
's reforms and obtained a personal promise from her that she would help the project, most importantly by extending the London Underground
London Underground
The London Underground is a rapid transit system serving a large part of Greater London and some parts of Buckinghamshire, Hertfordshire and Essex in England...
to reach it.
In Canada, Reichmann's once sterling reputation also began to suffer. In 1985 the company had bought Gulf Canada in a deal that included some $300 million in tax breaks. Many Canadians were infuriated that a massive corporation had been given such a lucrative deal. Toronto Life
Toronto Life
Toronto Life is a monthly Canadian magazine about entertainment, politics and life in Toronto, Ontario, Canada. Toronto Life also publishes a number of annual special interest guides about the city, including Home Decor, Stylebook, Eating & Drinking, Real Estate and Weddings. Established in 1966,...
magazine also published a highly critical article on the Reichmanns. The family took offence at allegations that Samuel Reichmann had aided the Nazis with illegal smuggling operations during the Second World War. The family sued the magazine for an unprecedented $109 million. They were successful, and Toronto Life published a full retraction, but their heavy fisted response soured many in the Canadian media to the Reichmanns.
In 1992, Olympia and York collapsed under some $20 billion in debt
Debt
A debt is an obligation owed by one party to a second party, the creditor; usually this refers to assets granted by the creditor to the debtor, but the term can also be used metaphorically to cover moral obligations and other interactions not based on economic value.A debt is created when a...
. Paul Reichmann lost most of his family fortune.
Recovery and retirement
Despite these setbacks, Reichmann successfully rebuilt a small portion of his empire. This included setting up a partnership with George SorosGeorge Soros
George Soros is a Hungarian-American business magnate, investor, philosopher, and philanthropist. He is the chairman of Soros Fund Management. Soros supports progressive-liberal causes...
, Lawrence Tisch and Michael Price
Michael Price
Michael F. Price is a value investor and fund manager in Far Hills, New Jersey.-Career:He began his career in 1973 when he joined Max Heine at Mutual Series. In 1982, he became a full partner and when Heine died in 1988, became the president and chairman. In 1996, Mutual Series was merged into...
along with investors such as Saudi Prince Al-Waleed
Al-Waleed bin Talal
Prince Al-Waleed bin Talal is a Saudi Arabian billionaire and member of the Saudi royal family. He is the nephew of King Abdullah of Saudi Arabia. An entrepreneur and international investor he has amassed a fortune through investments in real estate and the stock market.He is founder and CEO of...
to purchase a controlling stake in the Canary Wharf from the banks that made the original construction loans to Reichmann and which had taken control of the development. Reichmann became Chairman of Canary Wharf again and remained so until 2004.
During 2004 a takeover battle began for the Canary Wharf Group in which Reichmann eventually sided with Canadian developer Brascan to attempt a purchase of the company. During this process he resigned his position on the Board. In March, 2005 a consortium of investors led by Morgan Stanley under the banner of Songbird Estates purchased Canary Wharf Group, and Reichmann was therefore no longer involved with Canary Wharf on a day to day basis. Reichmann, at the time 75, announced that he intended to retire from business and sold many of his property holdings.
Current Activity
In September 2006, Reichmann announced that he was bored with retirement and that he would be setting up a new $4 billion fund, based in Toronto, with offices in Great Britain and the Netherlands. It appears that, at age 76, his enthusiasm for deals had been rekindled.See also
- Canadians of Hungarian ancestry