Paradise
Page 72
At exactly ten o'clock on Monday morning, Peter Vanderwild presented himself to Miss Stern, whom he'd privately nicknamed "The Sphinx," then he waited like an irritated supplicant for her to acknowledge him. Not until she was damned good and ready did she stop typing and aim her basilisk gaze at him. "I have an appointment to see Mr. Farrell at ten o'clock," he informed her.
"Mr. Farrell is in a meeting. He will see you in fifteen minutes."
"Do you think I should wait?"
"Only if you have nothing whatsoever to do for the next fifteen minutes," she replied frostily.
Dismissed like a recalcitrant schoolboy, Peter strode stiffly to the elevator and returned to his office. That seemed infinitely wiser than remaining on the sixtieth floor and thus proving to her he had nothing to do for fifteen minutes. At 10:15 Miss Stern motioned him into the inner sanctum while three of Haskell's vice presidents were still filing out of it, but before Peter could open his mouth, the phone on Matt Farrell's desk rang.
"Sit down, Peter," Matt said. "I'll be with you in a minute." With the phone at his ear, Matt opened the file on potential acquisitions that Peter had left with him. All of them were corporations that owned large blocks of commercial real estate, and Matt had reviewed each one over the weekend. He was pleased with several of Peter's choices, impressed by the extraordinary thoroughness of his research, and slightly stunned by some of his recommendations. When he hung up the phone, he leaned back in his chair and concentrated all his attention on Peter. "What do you particularly like about the Atlanta company?"
"Several things," Peter replied, startled by the abruptness of the question. "Their properties are mostly new commercial mid-rise buildings with a high percentage of occupancy. Nearly all their tenants are established corporations with long-term leases, and all the buildings are extremely well-maintained and managed. I saw that myself when I flew to Atlanta to look them over."
"What about the Chicago company?"
"They're into high-rent residential buildings in prime locations here and their profits are excellent."
Matt's gaze narrowed on the younger man as he bluntly pointed out, "From what I could see in this file, many of their buildings are over thirty years old. The cost of renovating and repairs will begin eating into those excellent profits in seven to ten years."
"I took that into account when I prepared that profit forecast in the file," Peter said. "Also, the land those buildings are sitting on will always be worth a fortune."
Satisfied, Matt nodded and opened the next file. It was this recommendation that had made him wonder if Peter's acclaimed genius might not have been overrated, along with his common sense. Frowning at Vanderwild over the top of the folder, he said, "What made you consider this Houston company?"
"If Houston continues its economic recovery, property values are going to soar and—"
"I realize that," Matt interrupted impatiently. "What I want to know is why you would recommend we consider acquiring Thorp Development. Everybody who reads The Wall Street Journal knows that company has been for sale for two years, and they know why it hasn't sold: It's ridiculously overpriced and it's badly managed."
Feeling as if the chair he was sitting in had suddenly become electrified, Peter cleared his throat and doggedly persevered. "You're right, but if you'll bear with me a moment, you might change your opinion about its desirability." When Farrell nodded curtly, Peter plowed ahead: "Thorp Development is owned by two brothers who inherited it ten years ago when their father died. Since they got control of the company, they've made a lot of poor investments, and to do that, they've mortgaged most of the properties their father had acquired over the years. As a result, they're in debt up to their corporate ears to Continental City Trust in Houston. The two brothers can't stand each other, and they can't agree on anything. For the past two years one brother has been trying to sell off the entire company with all its assets in a single bloc, while the other brother wanted to split up the assets and sell them off in pieces to anyone who'll buy one. Now, however, they don't have any choice except to do the latter, and do it quick, because Continental is about to start foreclosing."
"How do you know all this?" Matt asked.
"When I flew to Houston in October to visit my sister, I decided to look Thorp over and check out some of their properties while I was there. I got the name of their banker, Charles Collins, from Max Thorp, and I allied him when I got back here. Collins was desperately eager to 'help' Thorp find a buyer, and he talked his head off. In the course of our conversation, I began to suspect that the reason for his eagerness might be that he needs to get Thorp's loans off his books. He called me last Thursday and told me Thorp was eager to work a deal with us and that they'd sell out very cheap. He urged me to reconsider and make them an offer. If we move quickly, I figure we can pick up any of Thorp's properties for the amount of the mortgages on them, rather than their actual value, because Collins is about to foreclose and Thorp obviously knows it."
"What makes you think he's about to foreclose?"
Peter smiled a little. "I called a banker friend of mine in Dallas and asked if he knew Collins at Continental City Trust. He said he did, and he made a friendly phone call to Collins, ostensibly to commiserate about the sad state of banking in Texas. Collins told him the bank examiners were pressuring him to foreclose on several large, delinquent loans—including the ones to Thorp." Peter paused in silent triumph, waiting for some sort of compliment from his dispassionate boss for the thoroughness and outcome of his research; what he got was a brief smile and an almost imperceptible nod of approval. It felt as if God had just blessed him. Buoyed up beyond all bounds of reason by that, Peter leaned forward in his chair. "Are you interested in hearing about some of the properties Thorp owns? A couple of them are prime parcels that could be developed and sold for a fortune."
"I'm listening," Matt said, though he wasn't nearly as interested in buying and developing raw land as he was in buying commercial buildings.
"The best of Thorp's properties is a very desirable fifteen-acre parcel of land two blocks from The Galleria which is an enormous and deluxe shopping center with its own hotels. Neiman-Marcus is in the Galleria complex; Saks Fifth Avenue and a lot of exclusive designer boutiques are close by, and the expressway is within sight. Thorp's property is between the two shopping complexes, and it's the perfect site for another top-quality department store and mall."
"Mr. Farrell is in a meeting. He will see you in fifteen minutes."
"Do you think I should wait?"
"Only if you have nothing whatsoever to do for the next fifteen minutes," she replied frostily.
Dismissed like a recalcitrant schoolboy, Peter strode stiffly to the elevator and returned to his office. That seemed infinitely wiser than remaining on the sixtieth floor and thus proving to her he had nothing to do for fifteen minutes. At 10:15 Miss Stern motioned him into the inner sanctum while three of Haskell's vice presidents were still filing out of it, but before Peter could open his mouth, the phone on Matt Farrell's desk rang.
"Sit down, Peter," Matt said. "I'll be with you in a minute." With the phone at his ear, Matt opened the file on potential acquisitions that Peter had left with him. All of them were corporations that owned large blocks of commercial real estate, and Matt had reviewed each one over the weekend. He was pleased with several of Peter's choices, impressed by the extraordinary thoroughness of his research, and slightly stunned by some of his recommendations. When he hung up the phone, he leaned back in his chair and concentrated all his attention on Peter. "What do you particularly like about the Atlanta company?"
"Several things," Peter replied, startled by the abruptness of the question. "Their properties are mostly new commercial mid-rise buildings with a high percentage of occupancy. Nearly all their tenants are established corporations with long-term leases, and all the buildings are extremely well-maintained and managed. I saw that myself when I flew to Atlanta to look them over."
"What about the Chicago company?"
"They're into high-rent residential buildings in prime locations here and their profits are excellent."
Matt's gaze narrowed on the younger man as he bluntly pointed out, "From what I could see in this file, many of their buildings are over thirty years old. The cost of renovating and repairs will begin eating into those excellent profits in seven to ten years."
"I took that into account when I prepared that profit forecast in the file," Peter said. "Also, the land those buildings are sitting on will always be worth a fortune."
Satisfied, Matt nodded and opened the next file. It was this recommendation that had made him wonder if Peter's acclaimed genius might not have been overrated, along with his common sense. Frowning at Vanderwild over the top of the folder, he said, "What made you consider this Houston company?"
"If Houston continues its economic recovery, property values are going to soar and—"
"I realize that," Matt interrupted impatiently. "What I want to know is why you would recommend we consider acquiring Thorp Development. Everybody who reads The Wall Street Journal knows that company has been for sale for two years, and they know why it hasn't sold: It's ridiculously overpriced and it's badly managed."
Feeling as if the chair he was sitting in had suddenly become electrified, Peter cleared his throat and doggedly persevered. "You're right, but if you'll bear with me a moment, you might change your opinion about its desirability." When Farrell nodded curtly, Peter plowed ahead: "Thorp Development is owned by two brothers who inherited it ten years ago when their father died. Since they got control of the company, they've made a lot of poor investments, and to do that, they've mortgaged most of the properties their father had acquired over the years. As a result, they're in debt up to their corporate ears to Continental City Trust in Houston. The two brothers can't stand each other, and they can't agree on anything. For the past two years one brother has been trying to sell off the entire company with all its assets in a single bloc, while the other brother wanted to split up the assets and sell them off in pieces to anyone who'll buy one. Now, however, they don't have any choice except to do the latter, and do it quick, because Continental is about to start foreclosing."
"How do you know all this?" Matt asked.
"When I flew to Houston in October to visit my sister, I decided to look Thorp over and check out some of their properties while I was there. I got the name of their banker, Charles Collins, from Max Thorp, and I allied him when I got back here. Collins was desperately eager to 'help' Thorp find a buyer, and he talked his head off. In the course of our conversation, I began to suspect that the reason for his eagerness might be that he needs to get Thorp's loans off his books. He called me last Thursday and told me Thorp was eager to work a deal with us and that they'd sell out very cheap. He urged me to reconsider and make them an offer. If we move quickly, I figure we can pick up any of Thorp's properties for the amount of the mortgages on them, rather than their actual value, because Collins is about to foreclose and Thorp obviously knows it."
"What makes you think he's about to foreclose?"
Peter smiled a little. "I called a banker friend of mine in Dallas and asked if he knew Collins at Continental City Trust. He said he did, and he made a friendly phone call to Collins, ostensibly to commiserate about the sad state of banking in Texas. Collins told him the bank examiners were pressuring him to foreclose on several large, delinquent loans—including the ones to Thorp." Peter paused in silent triumph, waiting for some sort of compliment from his dispassionate boss for the thoroughness and outcome of his research; what he got was a brief smile and an almost imperceptible nod of approval. It felt as if God had just blessed him. Buoyed up beyond all bounds of reason by that, Peter leaned forward in his chair. "Are you interested in hearing about some of the properties Thorp owns? A couple of them are prime parcels that could be developed and sold for a fortune."
"I'm listening," Matt said, though he wasn't nearly as interested in buying and developing raw land as he was in buying commercial buildings.
"The best of Thorp's properties is a very desirable fifteen-acre parcel of land two blocks from The Galleria which is an enormous and deluxe shopping center with its own hotels. Neiman-Marcus is in the Galleria complex; Saks Fifth Avenue and a lot of exclusive designer boutiques are close by, and the expressway is within sight. Thorp's property is between the two shopping complexes, and it's the perfect site for another top-quality department store and mall."
