Nothing junior about this partner

Real Estate Weekly, Dec 6, 2000 by Elaine Misonzhnik

SIMON ZIFF, ACKMAN-ZIFF REAL ESTATE GROUP

For a man whose firm won three major business awards in the last year, Simon Ziff's manner is rather self-effacing. "I've been very lucky to end up as Larry Ackman's partner," he says.

According to Ackman himself, however, the luck factor went both ways. "When I chose Simon as my partner a few years ago I did so because I thought he was an outstanding young man, and a person of very high character and excellent ethics," Larry explained. "And he's proven that my judgement was excellent, because the company has been thriving ever since. Despite the fact that we had grown a lot, with Simon we were still able to maintain a family atmosphere."

Ackman-Ziff Real Estate Group is a 74-year old firm, specializing in debt and equity financing, which was started in 1926 by Larry Ackman's father Herman and his brother Burt. After Larry took over the firm in the 1960's, he took on an outside partner, Andy Singer, and changed the company's name to Ackman Brothers & Singer. But although Ackman and Singer have remained together for twenty years, in 1989 Larry decided to make a fresh start. Ackman Brothers & Singer was dissolved, and in 1995 Ackman-Ziff took its place, when Larry asked Simon, then his financial analyst, to become his new partner.

"One of my big breaks was probably the fact that Bill Ackman, Larry's son, was far too successful in his other endeavors to come into this business," Ziff joked. "Otherwise, I might still be Larry's analyst."

Ziff's background is rather unusual for a New York real estate man. He is originally from Phillip's Spring, Pa., a small town where his immigrant grandfather set up a clothing shop a century ago. Since then, most of his relatives have worked in the family business, and according to Ziff, his parents still don't exactly realize the importance of real estate in big cities.

"One of my main reasons for going into this business was the fact that I grew up in a very small town, to which I knew I would never come back," he said. "Since I didn't know where I was going to live, real estate would provide me with a career where I could work anywhere."

In addition, both Ziff himself and his associates characterize the finance specialist as an entrepreneur by spirit, so after taking an introductory course in real estate in his junior year at college, Ziff decided to major in real estate finance. That was a brave decision to make in the 1980's, when the job market in this industry was tepid, but that didn't stop Simon from pursuing his goals. "Well, you know how it is when you just come out of college," he said. "You have an idea of what you want to do, and you want to explore it regardless of whether it will bring in money."

After a brief stint with Mass Mutual as an analyst Simon came to New York to pursue a graduate degree in real estate at New York University. After his first full-time semester at the school, he came across an ad in The New York Times for a financial analyst's position and decided to apply. Although Larry Ackman proved to be an excellent boss, Simon never even dreamed that one day he would become his partner.

"When he hired me, there was no indication that there would be an outside partner in the future," Ziff remembered. "In fact, from 1989 to 1995, there was no discussion of anybody becoming a partner. Now, creating partners is essential to our business plan. We just created Ackman-Ziff-Chazen Realty Advisors, with Ed Chazen as a new partner, who will focus on equity financing. And in about three months, we plan to open a new office in Washington, D.C."

When Ziff speaks about his business plans, his facial expression changes from relaxed and somewhat withdrawn to extremely focused. "It's my opinion that the key to a great execution, like the one that won us the awards this year; is having everyone's interest 100% aligned," he explained. "That includes everyone -- the client, all of the individuals that work with the client, our firm and all of the individuals that work for our firm. Most brokerage assignments are not set up that way, but we try very hard to make sure that we are working as a team, with clients that are willing to work as a team as well."

"Good ethics is good business," Larry Ackman echoed him. "We are successful because we are ethical and people trust us. We represent only the owners, we don't have a divided interest as some of our competitors do, who act as mortgage correspondents and represent both the institution and the borrows in a financing transaction."

Alan Goodkin, who has worked at Ackman-Ziff as a senior director since March of this year, has been very impressed with the way the company operates. "I've been in real estate for the past eleven years, and I've never had a more productive time in my entire career," he said. "At Ackman-Ziff, there is actually a real business plan, which I found very unique and different from other companies I worked with. The atmosphere here is highly energetic and creative, and loose, and fun -- it's a good place to be."