Leonard N. Stern
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| Leonard Stern | |
|---|---|
| Born | March 28, 1938 New York City, New York |
| Nationality | American |
| Ethnicity | Jewish[1] |
| Occupation | Chairman and CEO of The Hartz Group |
| Known for | Businessman |
Leonard Norman Stern (born March 28, 1938)[2] is an American businessman and real estate developer.
He is the Chairman and CEO of the privately owned Hartz Group based in New York City. The company's real estate portfolio was owned and operated under its Hartz Mountain Industries subsidiary company, of which he also serves as Chairman and CEO.[3]
Based in Secaucus, NJ, Hartz Mountain Industries has added property in Manhattan, Westchester, NY, Long Island, NY, and Maryland. In addition to its property operations through its 'Industries' subsidiary, The Hartz Group has an active and growing financial operation.
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[edit] Wealth development
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He is listed by Forbes magazine as a billionaire;[4] and New York University's business school is named after him.[5]
[edit] Inheritance
Stern's initial wealth was inherited from his father, Max Stern, who died in the early 1980s. Max Stern was the German-born vice-chairman of the Board of Trustees of Yeshiva University for whom its Stern College for Women was named. He had emigrated from Weimar Germany to the U.S. in the 1920s after his textile business proved unprofitable, bringing along 2,100 canaries from Germany to sell on the U.S. market. By selling caged birds, bird cages and other pet bird supplies to U.S. pet owners through Woolworth's stores over the next thirty years, Stern's father built up the family business: Hartz Mountain Corporation (HMC), also headquartered in Secaucus, NJ. HMC would later grow to become the flagship subsidiary of The Hartz Group. The business was named after the Harz Mountains of Germany.
[edit] Hartz Mountain
Leonard Stern graduated from New York University (NYU) in 1957, purchased his brother's and sister's share of the family business and, by the early 1960s, exercised absolute control of Hartz Mountain Corporation (HMC). Hartz Mountain Corporation then began to capture the pet supply market that catered to both dog and cat owners and parakeet and canary owners.
By 1984, Hartz Mountain Corporation (HMC) controlled 75% to 90% of the U.S. market for most U.S. pet supply goods[citation needed]. Its pet supply business was estimated to be worth $400 million and was earning $40 million in annual profits.
[edit] Real estate and finance
Stern began Hartz Mountain's real estate operations in 1966 when he started to purchase land in New Jersey's swampy Meadowlands at $20,000 per acre. By 1987 Meadowlands' real estate was selling for $500,000 per acre. The value of Stern's Meadowlands property had jumped from $10 million in the late 1960s to over $1 billion by the late 1980s. According to a September 1987 Fortune Magazine article, Stern "made a killing building industrial parks" in the Meadowlands and "attracting companies with low rents." Gene Heller, the well-known President of Hartz Mountain Industries up until the 1990s, was the man with the grand vision and ability to broker the mega-deals during the company's heyday. He left Hartz in 1991 after a difference of opinion with Leonard Stern as to which direction the company should go, and has since started his own real estate firm.
Among the companies that moved their corporate offices from Manhattan to Stern's Meadowlands commercial office buildings were The Equitable Life Assurance Society, UBS/Paine Webber, Panasonic's U.S. headquarters, and WWOR-TV. Stern also made money from Hartz's Meadowlands real estate by building the Harmon Cove Towers high-rise apartments and condo village.
In 1987, the Hartz Mountain Industries subsidiary also completed a 24-story luxury office tower in Manhattan on Madison Avenue and 61st Street to which it relocated Stern's corporate offices, The Hartz Group. According to Business Week, 2004 rents were as high as $120 a square foot, second only to the General Motors building.
The 'Hartz' brand name (goodwill) was included in the sale of that subsidiary. To outsiders, there has always been some degree of confusion between the once flagship Hartz Mountain Corporation, which dealt exclusively with pet products, and that of the more glamorous business of Hartz Mountain Industries' real estate concerns. Currently, the pet products "Hartz" operation, still maintains a presence, but now as a regular tenant, at the same headquarters building as Hartz Mountain Industries (HMI) in Secaucus, NJ. Leonard Stern currently serves on the Board of Governors of the Real Estate Board of New York.
[edit] Other businesses
He has currently sold an ownership interest in a nearby Chart House Restaurant location. He currently owns the Soho Grand Hotel and the TriBeca Grand Hotel both in New York City (among others establishments)
[edit] Legal and image problems
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[edit] 1970s and 1980s
[edit] 1990s
According to the unsigned cover article, "Dynasty In Distress" in the February 9, 2004 issue of Business Week, Stern was "intensely engaged" as a board member of Rite Aid in the mid-to-late '90s when the drugstore chain admitted to overstating net income by $1 billion over two years.[6]
Stern was named in several class action suits[specify] in which investors claimed that he and other directors had breached their fiduciary duty to shareholders. A separate lawsuit, filed by Kevin Mann, the son of the original founder and former executive vice-president, alleged that Stern used his influence to increase shelf space in Rite Aid stores for Hartz's pet products at the expense of competitors. Rite Aid settled that suit in 1999 for $11 million.
Stern resigned from the board in late 2001. According to the article, he "brushes all of this aside: 'We saved that company from bankruptcy. We threw out the old management and brought in the new and set it on its turnaround' ".[6]
[edit] Founding of Homes for the Homeless
He was the founder in 1986 and is Chairman of Homes for the Homeless, which is the largest non-profit provider of residential, education and employment training centers in the United States[citation needed]. According to its website, it serves over 630 homeless families and over 1,200 homeless children each day at five separate sites across New York City. [7]
[edit] See also
[edit] References
- ^ http://www.jpost.com/JewishWorld/JewishFeatures/Article.aspx?id=187430
- ^ [1]
- ^ Executive profile at Hartz Mountain website
- ^ Forbes The World's Billionaires 2010
- ^ http://www.stern.nyu.edu/index.htm
- ^ a b "Dynasty in Distress". Business Week. Bloomberg. February 9, 2004. http://businessweek.com/magazine/content/04_06/b3869001_mz001.htm. Retrieved 18 July 2010.
- ^ homesforthehomeless.com
