The Big Win: Learning from the Legends to Become a More Successful Investor

Chapter 7

The Prophet of a Profitable Vision

A. Alfred Taubman

“I never look toward profits when I consider a development,” says master developer Alfred Taubman. “I look to projects—to how qualified the project is. What can it do? What are its opportunities?”

Taubman may not look to profits—at least not immediate profits—but over a long career, he has amassed an extraordinary fortune through profitable investments in retail real estate development. It may be that the fortune was achieved precisely because of what Taubman saw when he looked to the “opportunities” of a project.

He certainly saw things others did not. Taubman virtually invented the enclosed shopping mall, now so intrinsic to American suburban life that it is almost a symbol of the country itself. And if he didn’t invent the leveraged buyout, he nevertheless participated in what he thinks may have been one of the first on record, when he managed to persuade nine banks to lend him and his partners enough money—some $337.4 million—to buy the 77,000-acre Irvine Ranch, a premier real estate development in Newport Beach, California. He managed to do this because of what he saw when he looked at the Irvine project’s qualifications and opportunities. Simply put, Alfred Taubman saw enormous possibilities, with the potential for even greater value: “$50 million of infrastructure already in the ground,” he says, and “leases worth millions more.” No wonder he was able to raise the money to buy the place—a big win, one of many ...