Lunch at the Tribeca Grill with: Stephen Siegel
Published by The New York Sun on 2005-07-14
Stephen Siegel is jealous of Bill Gates.
"I don't begrudge his wealth - he earned it," Mr. Siegel said of Microsoft's co-founder. "What I'm jealous about is the amount of money he has to give away -- $40 billion so far. I wish I had more to give."
Nevertheless, he gives plenty each year to a variety of philanthropies in New York and elsewhere, including his old school in the Bronx.
In fact, as a young man Mr. Siegel never expected to leave the Bronx.
Neither had he imagined a career beyond that of a journeyman painter, which his father Charles was. And most certainly Mr. Siegel never imagined that he would one day become chairman for global growth of the world's biggest real-estate service and investment bank, CB Richard Ellis, a job he has held for the last two years.
"I started working when I was 11 years old," Mr. Siegel said. "I delivered groceries; I stacked newspapers at a neighborhood store. But it was going to City College that opened up a whole new world for me. And even then, I had to work to put myself through college."
One day he received a serendipitous call from a friend at Bing & Bing, a prominent real-estate company. The friend informed him that there was a low-level spot available. Mr. Siegel got a job in the mailroom, at a weekly salary of $70 - 30% more than what he was making in his previous, even more menial job. He rose steadily through the ranks.
He then joined another industry giant, Cushman & Wakefield. By his late 30's, he'd become chairman and CEO.
"I had good mentors who passed on their expertise quite openly to me," Mr. Siegel said, quietly deflecting a question about his ambition. "But I was also willing to take chances. Of course, there's also timing, and a little bit of luck that's needed for success."
He displayed how willing he was to take chances when he accepted an offer in March 1992 to become president of Gordon & Company. This was a small real-estate brokerage doing about $50 million in annual business. By 2000, Mr. Siegel had raised revenues to $1 billion, mostly by getting the company to go national.
There was also the fact that in that 8-yer period, real-estate was enjoying an uptick. And there was the fact that the company had been acquired by the Insignia Financial Group, which gave Mr. Siegel more heft in manpower and resources.
"We were very driven and focused," he said.
His performance got the attention of CB Richard Ellis. Mr. Siegel was already tiring of combining management duties with what he loved to do much more, investing.
And so exactly two years ago, he came to the behemoth. CB Richard Ellis and its partner and affiliate offices have more than 17,000 employees in some 300 offices scattered through 50 countries.
In 2004, the company posted service revenues totaling $2.4 billion and completed over 41,600 sale and lease assignments, with a consideration value of over $127.1 billion, according to the company's literature.
The firm's institutional property and corporate facilities management portfolio includes 989 million square feet.
There were 39,500 valuation and advisory assignments last year. In addition, through L.J. Melody & Company, the firm completed $13.3 billion in commercial mortgage originations, and through CB Richard Ellis Investors, it had $15.1 billion in investment assets under management. The stock price of the company, which is listed on the New York Stock Exchange, has gone from $19 when Mr. Siegel joined to $43.58, the price at which it closed yesterday.
Now Mr. Siegel spends much of his time in investing and syndicating real estate, nationally as well as abroad.
"I've watched my industry evolving into a thoroughly technology-driven business, with exceptional professionals," Mr. Siegel said. "But those of us who grew up in an environment where business relationships were formed more informally - but no less lucratively - miss the importance that used to be put on developing personal relationships. Because competition has been heightened, real-estate professionals tend to subordinate relationships - which you really can't, because people are still important. After all, it's people with whom you're doing business."
His personal success has enabled Mr. Siegel to expand his investments into restaurants and a minor league baseball team, among other things. He's on various boards, including that of the City Center.
"I'm having fun," he said.
Was there anything that he'd have done differently?
"Yes - I would have started earlier in the investment part of real estate," Mr. Siegel said. "I had the ability to raise capital, and I had the ability to understand markets. I should have put these abilities to use much earlier."
He said that the most moving moment of his career was when he learned that his father had been writing him a letter on his deathbed. In it, Charles Siegel told his son how much he wished that they could have spent more time together but that he was forced to work two or three jobs a day to put food on the family table.
"He didn't get to finish that letter," Mr. Siegel said. "But I know that he would have said how proud he was of me. But not any prouder than I was of him. My dad was my hero."
Senior Writer and Global-Affairs Columnist