just before bill ackman turned 28 he was able to participate the takeover of rockefeller properties worth one billion dollars at the time how did he do it [Music] with a strong belief that you can learn investing on your own bill ackman decided to start his own hedge fund right out of the graduate school but little did he know no one would want to invest with him after being rejected dozens of times he reached out to his professor in college marty parris parrots owned a publishing company and was reluctant to invest at first being a great
salesman ackman finally convinced him to put up 250 000 to his new hedge fund gotham partners paris investment gave ackman an approval of confidence he then used that to convince several more investors to invest with him he and his partners eventually raised a total of three million dollars even with that three million ackman would never thought that just in five years his hedge fund will grow to be 500 million dollars it all started with one big opportunity [Music] in the mid 1980s the rockefeller family wanted to take out 1 billion plus mortgage loan on the
property but there wasn't a bank big enough to lend it to them instead they set up a public company structure as a real estate investment trust called rockefeller center properties david rockefeller was a chairman of the board and investors bought the stocks largely because it paid big dividend and they liked the idea of partnering with the rockefellers but as the real estate market was falling apart in the early 1990s 1994 the real estate market fell leaving trump unable to make payments on the land and in 1990 the whole country it just went very very bad
the company was forced to cut the dividend the stock price collapsed and the reit was under a lot of financial stress due to its high debt bill ackman saw opportunity he figured out that since the riot is trading at a very low price it is possible to acquire controlling positions of rockefeller center properties by purchasing the stocks in the market he believed that there is a huge long-term value of the real estate that everyone overlooked at that time rockefeller centers had 6 million square feet of office space some of the most valuable yet under managed
retail space in the world and 2 million square feet of air rights his plan sounds exciting and potentially can tenfold his investment but there's one problem he didn't have enough capital to take over the company agma ran around town trying to find someone who would do this deal with him but no one seemed interested or even understood his idea not until he called jill steinberg jill steinberg was the president of lokidia national corporation a public trade investment company he met with ackman and immediately decided to partake in this deal they together bought a good chunk
of rockefeller center then they started to rally the rockefellers and other owners to re-capitalize the company their proposal included selling ackman and steinberg additional shares of equities with special rights attached worth around 150 million dollars this will allow both of them to own the rockefeller center but the board turned down ackman's proposal and chose a different deal with goldman sachs even though ackman failed to acquire rockefeller centers he made a significant return for the trade but more important than monetary returns bill ackman had made a great name for himself after the rockefeller center deal had
closed ackman walked away with some powerful players on his side by 1998 five years after starting gotham partners had grown from three million dollars under management to over 500 million dollars [Music] [Music] you
