FEATURE: RE-Incarnation

The market has changed, and these 12 pros have changed jobs to seize the new day. By Jonathan Brasse and Zoe Hughes. PERE magazine October 2009

Financial markets are resilient not only because capital can quickly flow to superior ideas, but because talented people can quickly move to promising new ventures.
This trend is currently under way across the global real estate market. Not a week goes by where PERE editors fail to learn of a staff shakeup, new hire, spin-out, poaching, or an amicable parting of ways. This is the human capital equivalent of the creative destruction so necessary in getting the market moving again. 
PERE presents 12 case studies of talented real estate professionals who have recently been reborn into new jobs to pursue new opportunities. All no doubt believe that they are now well positioned to exploit the investment opportunity of a lifetime.

The RE-Incarnated:
Joseph Azrack, Apollo Global Management
David Ferrero, Alcion Ventures
John Gellatly, Aviva Investors
Lynn Gilbert, Mount Street Capital
David Glickman, Pension Consulting Alliance
Jeff Jacobson, LaSalle Investment Management
Lehman Brothers Real Estate Private Equity
Stephanie Power, Marley Real Estate Capital
Andrew Radkiewicz, Prudential Real Estate Investors
Bill Schwab, Abu Dhabi Investment Authority
Jeffrey Schwartz, Global Logistics Properties
Wilfred Wong, Pacific Star

Joseph Azrack
  After helping create Citigroup’s private equity real estate platform, Joseph Azrack moved to set up another real estate operation – this time for Leon Black’s buyout shop, Apollo Global Management. The firm is now raising a $600m mortgage REIT.

Joseph Azrack likes to build things. From AEW Partners real estate funds and Citi Property Investors, Azrack has played a key role in getting private equity real estate platforms off the ground.

Joseph Azrack

Today, he sits in the offices of Apollo Global Management, leading the firm’s new dedicated real estate group. Azrack moved to Leon Black’s operation last August after four years running CPI. The move came at an opportune time. Less than one year after joining Apollo, Citigroup said it wanted to exit the private funds business, putting CPI on the market.

According to people familiar with the matter, the writing was already on the wall when Azrack departed. Under increasing pressure, Citigroup couldn’t commit to growing the CPI business to the same extent it had in the past. The bank was reluctant to consider a sale or management spin-out at the time, but, as the industry has seen, Citigroup ultimately changed its mind on that issue. For Azrack though, his new outfit is all about growth.

With at least 10 dedicated real estate professionals and more expected in the coming months, Apollo Global hopes to be a formidable player in the real estate asset class. It has already floated a $600 million mortgage REIT, which will primarily target senior performing debt, with institutional funds expected in the near future.

  A spell investing Harvard University’s endowment couldn’t stop David Ferrero from unveiling his true GP colours. Today he is a partner at Boston-based real estate investment firm Alcion Ventures targeting key metropolitan US cities.

As director of real estate at Harvard Management Company, David Ferrero was charged with growing the university endowment’s $1 billion property portfolio to its target allocation of 10 percent.

David Ferrero

By the time he left in August 2007, Ferrero had done more than just raise HMC’s standing in the private real estate investment world, he had also increased the portfolio value to more than $2.7 billion, with a roughly equivalent amount in outstanding unfunded commitments. Named as one of PERE’s “rising stars” in 2007, Ferrero was described by one industry practitioner as “one of the most influential LPs out there … [and] one of the nicest guys you’ll meet.”

However, Ferrero was always really a GP in LP clothing. Even though he was HMC director between 2004 and 2007, Ferrero also worked for opportunity funds, including Boston-based Aldrich Eastman Waltch.
Today, Ferrero is partner at another Boston firm, Alcion Ventures. Joining the group in November last year Ferrero spent the intervening time helping raise his newborn twins and working on business plans, according to people familiar with the matter. Concentrating on growing Alcion, which was founded in 2005, Ferrero is helping the North American opportunity fund manager target key metropolitan markets, including opportunities in distressed hotel, retail and busted condo deals.

At 39, Ferrero is still too young to call himself an experienced distressed investor, however one of his first jobs was as an analyst at Aldrich Eastman Waltch underwriting the mistakes of the savings and loan era. There’s not much better grounding than in the RTC war rooms learning from other people’s mistakes.

John Gellatly
 From head of BlackRock’s European real estate funds of funds to leading Aviva Investors’ European multi-manager business.

Europe is a key market for Aviva Investors, not least the UK where John Gellatly will lead the firm’s European multimanager business.

At BlackRock Alternative Advisors, Gellatly spent four years growing and leading the firm’s European fund of funds operations and prior to that he was a director at Credit Suisse First Boston, working in the real estate investment banking team.

For Aviva, though, Gellatly’s appointment in May comes at a great time. Repricing in the UK has taken place more quickly than elsewhere, with Aviva Investors believed to be active in the country’s secondaries market. Deals will no doubt be done and as vice chair of the research group of UK industry body, the Investment Property Forum, Gellatly will play a pivotal role in trying to ensure their success.


From being at the forefront of European structured real estate debt, Lynn Gilbert is now director at start-up firm Mount Street Capital.

Gilbert was one of the most powerful structured real estate professionals in Europe at the height of the credit boom. She was managing director and head of real estate in the MENA region at Barclays Capital between 2004 and 2008.

Before that she was head of European CMBS origination at Morgan Stanley. Her time at the forefront of structured real estate debt came to an end in 2008 when she left Barclays. However, she has resurfaced at start-up firm Mount Street Capital that is raising a London industrial property vehicle. In that sense, she has gone from bits of paper to warehouses.   

David Glickman

HIS RE-INCARNATION: A former partner with AREA Property Partners, David Glickman is helping PCA’s push back into real estate.

GPs are not the only ones who see the opportunity of a lifetime in the real estate asset class – so too do consultancies, including Pension Consulting Alliance.

In February, PCA hired former AREA Property Partners partner David Glickman to help expand the firm’s real estate practice, led by Christy Field. Originally co-founded by Allan Emkin and Nori Gerardo Lietz in 1988, the firm’s discretionary real estate asset management arm was sold to Partners Group in 2007.

Today, Emkin is hoping to rebuild that real estate presence with Glickman a key element to his strategy. A partner at AREA between 2001 and 2005, Glickman has also worked for Heitman, the REIT Ambassador Apartments and founded securities firm Ambassador Capital Management in 1999.

 Having led LaSalle Investment Management from London for the past nine years, Jacobson is relocating East to Asia to help grow the firm’s platform in the region.

An unusual entry for a feature dominated by moves between companies, but no less significant. Tongues started to wag within hours of LaSalle Investment Management’s announcement that global chief executive officer Jeff Jacobson planned to up sticks from London – his home for nine years – to relocate to Singapore,

Jeff Jacobson

not least after LaSalle’s CEO for Asia Pacific, Jack Chandler, opted to semi-move back to Chicago last year.

However, long-time LaSalle servant Jacobson has been quite clear the move represents something of a missing piece in his personal jigsaw.

Having worked in the US for more than 15 years prior to his move to Europe, LaSalle said the move will not affect Jacobson’s role, nor that of his colleagues. With plenty of projects afoot for the firm in Asia, including a bid for Merrill Lynch’s Asia-focused global real estate principal investments group, Jacobson will find himself very busy when he starts on 1 January, 2010.

Then there is the small point of $3 billion in equity from LaSalle’s third Asia opportunity fund which still needs spending. Other private equity real estate firms might want to take note that while popular investor sentiment has drifted towards more mature markets in the US and Europe, one of the world’s biggest firms will have its leader in the East.

One year since the bankruptcy of its parent company and sponsor,
the management team of Lehman Brothers REPE has staged a management buyout of the group with
the help of Mark Walsh, the bank’s commercial real estate king.

Okay, there are actually five people for this entry, but if you’re talking about RE-Incarnation you can’t ignore the management team of Lehman Brothers Real Estate Private Equity (REPE).

After the group’s parent company and sponsor filed for bankruptcy in September last year, its future was thrown into doubt. However, after almost nine months of negotiations with LPs and the Lehman estate, the management team – including global co-heads Mark Newman and Brett Bossung, CFO Rodolpho Amboss, asset management head Kevin Dinnie and the group’s founding head Mark Walsh – have launched a buyout of the platform.

Lehman's HQ

LPs are in the process of voting on the plan, which will allow them to reduce their unfunded commitments and see a 100-person strong REPE team continue to manage the assets of REPE’s three opportunity funds. What the move, more importantly, paves the way for is a reinvigorated REPE team.

Indeed, the past year could even be called “fortuitous” for the group. With a number of bank-sponsored platforms in the process of being sold or spun-out, the REPE team is ahead of the curve and ready to move forward as an independent entity.

Newman, who was head of Fortress Investment Group’s nascent European business before joining Lehman in 2000, and Bossung, a 17-year veteran of Lehman who co-led the firm’s real estate mezzanine fund business before co-heading REPE, tell PERE the firm will primarily concentrate on managing existing assets but will consider raising targeted, rather than global, funds in the future.

The pair, who will work closely with Walsh in leading the new group, naturally have more modest ambitions, but will look to the US, Europe and India – places where REPE has previously invested – for opportunities. Debt, as well as equity plays, will be part of the mix.

Looking forward, Newman adds, the pair hope to strategically grow the business with support from their institutional investor base. “The fact that we have stayed together through a period of great uncertainty, not just for REPE but the industry as a whole – that keeps us going,” Newman says.

Stephanie Power helped grow the US value-added platform UrbanAmerica from a start-up to a firm able to raise $520m across two discretionary funds. A 10-year plan to learn the business and launch her own firm has now been realised with the creation of Marley Real Estate Capital.

The bursting of the real estate bubble has seen numerous names spin-out to form their own firms and gain a bigger slice of the action. Stephanie Power is one of the few women to have made that jump.

Stephanie Power

After helping grow the value-added fund manager UrbanAmerica over the past decade alongside founders Hal Reiff and Richmond McCoy, Power started Marley Real Estate Capital in April 2008 to target distressed domestic opportunities.

Working with Reiff, Power has already teamed up with operator Robert Martin to sponsor institutional private equity real estate funds. During a decade at UrbanAmerica, Power – who was the first hire by Reiff and McCoy wearing many hats and ultimately heading strategic planning – helped raise two discretionary funds, the second of which was oversubscribed by almost $100 million.

However, she tells PERE the intention was always to build her own platform. Ever since graduating from Columbia Business School in 1998, Power had a 10-year plan to “learn the ropes and then launch my own company”. Her focus, she says, has always gravitated towards distress.

And she sensed the timing was working in her favour when, at the height of the bubble, it became clear that underwriting assumptions had become untenable. Today, there are plenty of distressed opportunities for Power and her team to choose from.

Andrew Radkiewicz
After launching his own mezzanine platform, Radkiewicz and his team have turned to Prudential Real Estate Investors to help launch a high-yield debt platform in Europe under the Pramerica umbrella. The team are believed to be targeting an initial £500m fund.

The credit crisis has put many best-laid plans to waste, however for Andrew Radkiewicz it has also done him a favour. In January, Radkiewicz and his team – including origination expert Andrew Macland and securitisation legal brain Mathew Crowther – joined forces with Prudential Real Estate Investors to develop a new European real estate debt platform.

The business has been matched by a similar group in the US and will be led globally by ex-Five Mile Capital executive Jack Taylor. For Radkiewicz, though, partnering with PREI has allowed him to create a mezzanine debt shop with a truly global reach.

After 12 years at London investment bank NM Rothschild, helping build the organisation into one of Europe’s leading specialist mezzanine and debt originators, Radkiewicz says it was time to branch out. Initially, the team explored the possibility of an IPO of a mezzanine platform, Rocksburgh Capital, but given market conditions following the credit crisis it soon became clear the private investment world was the most viable route to raising capital.

Turning to the institutional investor community, Radkiewicz and Macland formed Paramount Private Equity last year, and after talking with four potential partners, Radkiewicz says PREI was the clear choice: “This is a firm in the private equity real estate business for the long-term. Rather than taking an opportunistic view, PREI wants to build a long-term platform. That is extremely appealing.”

  From a managing director in the European real estate finance division of JP Morgan to head of global real estate at the Abu Dhabi Investment Authority (ADIA). Schwab is now arguably the most powerful real estate LP in the world.

By the time ADIA selected Bill Schwab, the world’s largest sovereign wealth fund had spent a year trying to find a suitable successor to Mark Burton. Burton had led ADIA’s real estate division between 2001 and 2007 and left to take up a similar position at compatriot fund, Abu Dhabi Investment Council.

The wait, for Schwab, was worth it as he now holds, arguably, the most powerful job in global real estate investing.

The Abu Dhabi Investment Authority has a gargantuan spending power, managing anything between $450 billion and $875 billion depending on what figures you read.

For Schwab, a real estate finance man who held senior positions at both Deutsche Bank and Goldman Sachs and has worked in both real estate equity and debt, an opportunity has arisen to take charge of one of the world’s few cash-rich buyers.

This year the wealth fund, like others of its kind, has steered clear of committing heavily to blind pool limited partnerships as it prioritises direct investments. At previous employer JP Morgan, Schwab was responsible for originating and executing deals in Europe. He will need to rely on his skills honed during that time if he is to compete successfully with the third-party fund managers ADIA had previously entrusted to spend its petro-dollar war chest.

  From chairman and chief executive officer of ProLogis to chairman of Global Logistics Properties, Schwartz is now managing the Asian operations of the firm he originally helped build. GIC Real Estate formed the venture with Schwartz after buying ProLogis’ Asian business for $1.3 billion.

Having built ProLogis into the world’s biggest logistics real estate company, New Jersey-raised Schwartz
found himself falling on his sword in November 2008.

Despite 15 years at the helm of the Denver-based firm, Schwartz was replaced by chief operating officer

Jeffrey Schwartz

Walter Rakowich, who ironically had announced his own retirement just nine months earlier. By many accounts, Schwartz pursued global domination successfully up to the firm’s height in 2007, when it controlled $36.3 billion of assets worldwide. 

Its development platform alone was valued at $4.1 billion. But as debt became increasingly hard to secure, let alone service, ProLogis’ share price tanked by more than 90 percent. The heavily-indebted ProLogis had little choice but to start cutting costs, an exercise that ultimately saw its headcount reduced, new development halted and assets sales.

No disposition was more significant than the $1.3 billion sale of its Asian business to Singapore’s GIC Real Estate.

The deal also offered Schwartz a chance to manage a part of the business he first pioneered. After months of silence, Schwartz resurfaced as the chair of Global Logistics Properties, a joint venture between himself and GIC Real Estate, the real estate investment arm of the Singapore government.

GIC’s decision to move from being an investor in ProLogis’ funds to financing its own platform may have given Schwartz another bite at the cherry, but this time he won’t be so concerned about a tumbling share price as he seeks to grow a business in the world’s largest growth zone.

Wilfred Wong
Previously executive vice chairman of Shui On Land Group, Wong has joined Pacific Star as executive chairman for China to help grow the firm’s pool of Chinese investors

A major reason for Wilfred Wong’s appointment by Pacific Star was his relationships with China’s investor pool, a previously untapped source for the Singapore-based fund manager.

The sale of a stake in Wong’s former company Shui On Land Group, a real estate company in which Pacific Star invested $150 million in May 2004, garnered the firm an IRR of 150 percent.

Such heady figures are harder to attain these days but as China is predicted to increase the amount of capital its qualified domestic institutions can spend outside of the country, Wong – who will lead Pacific Star’s offices in Beijing, Shanghai and Hong Kong – will be leaning on his domestic contact base to leverage two pan-Asia funds currently be marketed.


While a number of big names have taken big jobs in recent months, there are a host of names waiting in the wings for the right opportunity to re-join the throng. PERE considers three people likely to emerge sporting new colours in the near future:

Sonny Kalsi

Anticipated comebacks don’t come much bigger than Morgan Stanley’s former global head of real estate investments Sonny Kalsi. Suggestions he would be the leading figure behind private equity giant KKR’s real estate platform debut, a position he was lined up to take prior to his controversial departure from the Wall Street bank, failed to materialise. However be assured Kalsi, who was placed on administrative leave in February after MSREF launched an investigation into alleged foreign corrupt practices by China-based employees, will create big headlines when he does return.

Gerald Parkes

Within a month of the collapse of Lehman Brothers, Gerald Parkes, European head of its private equity real estate business REPE, was reported as being part of a management buyout of the vehicle. When the buyout eventually materialised 10 months later, he was nowhere to be seen, leaving Brett Bossung, Mark Newman, Rodolpho Amboss, Kevin Dinnie and Mark Walsh to assume control of the platform without him. Parkes has reportedly teamed up with British property veteran Sir John Beckwith to scout investment opportunities in Europe. Few details were available at press time.

Tim Grady

Tim Grady, Merrill Lynch’s former managing director and head of global commercial real estate, has been on gardening leave since April when he quit the bank amid disagreements with senior management over the direction of the principal real estate investing platform. The platform itself was placed on the market within months of his departure and has been offered to rival firms ever since. Grady himself has been courted a few times but to no avail. Those close to the man suggest he is keen to take a role very soon although it may not be fundraising focused.