Chapter 955
NBA Commissioner's Plea for Help
John Reed had no idea what Lin Haoran was thinking; after all, in his view, these were just market prices.
They can't see how crazy New York housing prices will be in the future.
At this moment, he did not stop what he was doing, but instead opened the fifth folder.
"Lin, here's another one that I think you might be interested in: One Wall Street, the Irving Trust Building. This building was completed in 1931 and is a classic Art Deco landmark in New York. It has 50 floors and a total floor area of 1.1 million square feet. It is located in the absolute heart of the intersection of Wall Street and Broadway."
Residential buildings occupy about 25% of the building's area, while the rest are office and commercial spaces, making it a mixed-use skyscraper.
The residential portion has already been sold, as has some of the office space. The remaining 31 floors are currently owned by Irving Trust Bank; in other words, what was actually sold was the ownership of these 31 floors.
Lin Haoran took the documents and saw the price quote: a total price of 5000 million to 5300 million US dollars.
This is a top-tier landmark with the number one address on Wall Street, boasting immense historical and cultural value, and its owner is Irving Trust Bank.
Assets of this caliber would be worth at least three to five times more in ten years.
"John, if I want to acquire this building outright and take back all the remaining ownership rights, how difficult will it be?" Lin Haoran asked.
Upon seeing this building, Lin Haoran suddenly made a decision: to entrust his Mandarin Oriental Hotel Group with opening a Mandarin Oriental Hotel here—it would be perfect.
John Reed paused for a moment upon hearing this, then began to think seriously.
One Wall Street's historical significance and geographical location are beyond question, but recovering all the scattered ownership is indeed not an easy task.
“Lin, if you want to acquire the entire building, it will be difficult, but not impossible.” John Reed carefully chose his words. “The residential part has already been sold to private owners. If you want to take it back, you will need to negotiate with each household individually, which will be very expensive and time-consuming.”
However, if you simply want to acquire the 31 floors held by Irving Trust Bank, that's very simple; they have a clear intention to sell now and can easily sell the entire property as a package.
Lin Haoran nodded, already having made up his mind.
He picked up his teacup, took a slow sip, and said directly without hiding his thoughts, "John, 31 floors is fine, that's enough. The location and construction quality of this building are perfect for a high-end hotel."
My Mandarin Oriental Hotel Group has been looking for opportunities to enter the New York market, and One Wall Street is an excellent location.
John Reed's eyes lit up, and he smiled, "Lin, your idea is excellent. One Wall Street is located at the intersection of Wall Street and Broadway, in the heart of the entire financial district."
Although the hotel market in the financial district is currently dominated by business travelers, as the world's premier financial district, it also boasts a massive high-end consumer base. With Mandarin Oriental's brand positioning and service standards, it can certainly establish a firm foothold on Wall Street and even lead the high-end hotel market in the entire financial district.
John Reed sent a wedding gift to Lin Haoran and Guo Xiaohan in Hong Kong in February. At that time, there were so many important people that the Peninsula Hotel was completely full, so some guests were assigned to the Mandarin Oriental Hotel in Central.
John Reed stayed at the Mandarin Oriental Hotel for several days and was deeply impressed by the hotel brand. The service concept that perfectly blends Eastern elegance with Western comfort impressed even a banker like him who was used to seeing the world's top hotels.
He still remembers the sandalwood in the Mandarin Oriental room, the blue and white porcelain in the corridor, and the exquisite Cantonese dim sum in the restaurant; every detail exudes an understated luxury.
“Lin, to be honest, the Mandarin Oriental left a very deep impression on me during my stay in Hong Kong in February,” John Reed said with a smile. “If One Wall Street could open a hotel of the same standard, I’m sure the financial elites of Lower Manhattan would be scrambling to book it.”
The partners at Goldman Sachs spend millions of dollars a year on travel alone; they certainly wouldn't mind staying in a $1,000-a-night suite on Wall Street.
Lin Haoran smiled, picked up his teacup, and took a sip.
He knew that John Reed was right.
There is indeed a gap in the high-end hotel market on Wall Street. Investment banking partners, hedge fund managers, and private equity moguls who earn millions or even tens of millions of dollars a year cannot find hotels in Lower Manhattan that truly match their status.
They either stayed at the Four Seasons, Ritz-Carlton, or Marriott in Midtown, or made do with a boutique hotel in Downtown.
If the Mandarin Oriental could open at One Wall Street, it would fill this gap perfectly.
"John, the asking price for this building is $5000 to $5300 million, that's for the 31st floor held by Irving Trust Bank, right?" Lin Haoran asked.
John Reed flipped through the documents and replied, "That's right, it's about 60 square feet, which works out to less than $100 per square foot. In the heart of Manhattan, that's rock bottom. If the market weren't so sluggish right now, there would be very few buyers willing to purchase such high-priced properties, and they wouldn't be able to offer such a low price."
After you buy it, the investment in converting it into a hotel might be higher than the acquisition price, but in the long run, it's definitely a worthwhile investment.
US housing prices have been on a downward trend since the mid-70s, and only began to show signs of stabilization last year. However, market confidence has not yet recovered, and very few people are willing to make large investments in commercial real estate at this point.
This is why top-tier assets like One Wall Street are available on the market at such low prices.
Lin Haoran quickly did some mental calculations.
60 square feet, a little over $5000 million, less than $100 per square foot.
This price is less than half the construction cost.
Although the building was completed in 1931 and is already 51 years old, in New York, the world's skyscraper capital, there are many buildings that are over a century old. As long as they are properly maintained, they can operate for another century without any problem.
Moreover, this building is a classic example of New York's Art Deco style, with top-notch architectural quality and historical value.
Although renovating a hotel requires a significant investment, given Mandarin Oriental's brand premium, the return on investment period shouldn't be too long.
Lin Haoran has added another building to his list of potential acquisition targets.
It must be said that New York truly lives up to its reputation as the world's largest metropolis; there are simply too many investment opportunities, everywhere, far more than in Hong Kong.
However, Hong Kong is the core of his business, and he is more familiar with Hong Kong, so his previous industrial investments were mostly concentrated in Hong Kong.
In the United States, apart from the Global Investment Company financial platform and the numerous shares of US-listed companies secretly held by Global Investment Company, he has not yet made any large-scale investments in real industries.
But now it seems the time is ripe.
With nearly $400 billion in hand, they were wondering what to do with it when an opportunity presented itself.
Lin Haoran picked up his teacup, took a slow sip, and was already calculating in his mind how to maximize the value of these buildings.
John Reed was secretly surprised to see that Lin Haoran also showed great interest in No. 1 Wall Street.
This young tycoon had a much bigger appetite than he had imagined.
Two buildings in Times Square, three in Wall Street, that's already five, with a total value exceeding $3.5 million, but judging from Lin Haoran's expression, it seems he still doesn't think it's enough.
Moreover, he only introduced these 5 properties to the other party; there was still a lot of information left.
Throughout Manhattan, there are far more properties for sale than just these few buildings. Just considering the sales information that Citibank has, they receive dozens of listings every year for commercial buildings worth at least several hundred million or even hundreds of millions of dollars. In addition, there are over a hundred listings for commercial buildings that didn't sell in previous years.
Keep in mind that each of these documents represents an entire building in Manhattan!
If I were to introduce all one hundred or so copies, wouldn't the other party be interested in them all?
John Reed muttered to himself.
Among the thick stack of documents in front of him, there were at least a hundred more buildings that he hadn't had time to introduce.
Normally, John Reed, the Citibank heir, wouldn't need to personally explain these things, since they would only receive a 2% commission for helping to find suitable buyers.
A transaction worth tens of millions of dollars, with 2% representing hundreds of thousands or even millions of dollars, seems like a considerable income. However, these are all done by subordinates, naturally not by the higher-ups. But Lin Haoran is his closest ally at Citibank, so he naturally has to personally handle things properly.
Lin Haoran had no idea what John Reed was thinking. If he had, he would have laughed and said, "John, you don't need to worry about me. I want all of these buildings, and I can even take over all of the hundred-plus buildings you have."
However, he naturally wouldn't say those words aloud.
With nearly $400 billion in available funds, buying up all the prime properties for sale in the heart of Manhattan wouldn't be a problem, but doing so would be too ostentatious.
Although Lin Haoran is not afraid of being high-profile, there is no need for him to spend all his money on real estate in New York.
His investment portfolio spans multiple sectors including finance, technology, luxury goods, and real estate. He understands better than anyone the principle of not putting all your eggs in one basket.
This purchase of real estate in New York was somewhat impulsive, but since he had stumbled upon this historic window of opportunity, he naturally wouldn't let it slip by.
Seeing the thick stack of documents in front of John Reed, Lin Haoran thought to himself, "If John were to explain all of this, wouldn't it take several hours?"
So he said directly, "John, why don't you give me these documents first? I'm going to take them back and take a good look. If I find anything I like, I'll ask Citibank to help me contact the owner."
John Reed paused for a moment upon hearing this, then laughed: "Lin, are you sure you want to see so much? There are at least 150 documents in total, and each one is quite thick. Can you take them all back and read them all?"
Lin Haoran laughed and said, "Whether I can take it all or not is my business. Just give it to me first. I really think highly of commercial real estate in Manhattan. It won't hurt to take a look more."
He decided to take the information back and carefully select a few dozen properties, which would be enough, especially those that would be incredibly valuable in the future but are currently very cheap, such as those two buildings in Times Square, which he definitely wanted.
John Reed nodded, tidied up the thick stack of documents in front of him, and pushed them all in front of Lin Haoran: "Okay, since you're interested, take these back and look at them at your leisure."
If you see something you like, just let me know. Citibank will fully cooperate with you, and we can even help you negotiate a lower price.
Lin Haoran took the stack of documents, weighed them in his hand, and estimated they weighed at least ten kilograms.
There's no rush. He's just arrived in the US and will definitely stay in New York for a while. There's plenty of time to see how things go.
Lin Haoran put the documents aside, picked up his teacup, took a final sip, and continued chatting with John Reed.
John Reed would occasionally consult Lin Haoran. Ever since experiencing the US stock market crash, he had been deeply impressed by Lin Haoran's financial judgment. Now that he had the opportunity to ask him for advice in person, he naturally wouldn't let it pass.
The two discussed everything from macroeconomics to monetary policy, from US stock market trends to the dollar exchange rate, and from commercial real estate to banking reform.
Although Lin Haoran was not formally trained in economics, he had a certain understanding of the global economic situation in the 1980s and 1990s through the internet in his previous life. Coupled with his practical experience in the past few years, he spoke eloquently about these issues, which greatly benefited John Reed.
“Lin, to be honest, after working in banking for so many years, I thought I had a pretty deep understanding of the market. But after listening to you, I realize I still have a lot to learn,” John Reed said sincerely, picking up his coffee cup.
Lin Haoran smiled and waved his hand modestly: "John, you flatter me. I was just lucky. My perspective on things may be a little different from yours."
John Reed shook his head: "It's not luck, it's insight. Luck can make someone money once, but to make someone accurately predict market trends multiple times in a row, that's definitely not luck."
Lin Haoran didn't say anything more.
There are some things he can't explain, and doesn't want to explain.
Just then, there was a knock on the door.
The one who walked in was Walter Riston, chairman of Citigroup.
"Did I disturb you?" Walter Riston walked into the office and greeted Lin Haoran and John Reed with a smile.
“Of course not, we were just chatting.” Lin Haoran smiled and gestured for Walter Riston to sit down.
Walter Riston sat down on the sofa, and an assistant poured him a cup of coffee.
He thanked him, then looked at the thick stack of documents on the desk and asked curiously, "Mr. Lin, I heard you're very interested in commercial real estate in Manhattan? John just mentioned to me that he wanted to see information on commercial buildings for sale in Manhattan."
Lin Haoran nodded and did not hide anything: "Mr. Walter should also know that my Huanyu Investment Company is developing in the direction of securities, funds and other areas, and the number of employees is increasing."
Therefore, the company's office space is not enough. Since commercial real estate prices in Manhattan are currently low, I'm thinking of buying my own building.
John showed me a few nice properties, which I'm very interested in. It's good that I have some spare cash; if things go well, I plan to buy more to rent out. Although the payback period is long, the intrinsic value of the property is there, and in the long run, it's a win-win situation.
Walter Riston picked up his coffee cup, took a sip, and said meaningfully, "Lin, your judgment has always been very accurate. Manhattan's commercial real estate is indeed at a low point right now, but it has definitely hit rock bottom and is rebounding."
Moreover, while the return on rent may not be high, its stability is a major advantage. Properties like Goldman Sachs headquarters often have leases that are signed for over a decade, ensuring a very reliable cash flow.
Lin Haoran smiled but didn't reply.
He knew that although these bankers said that, it was impossible for them to get Citibank to invest in real estate.
After all, finance is the fastest way to make money, while real estate is nothing more than a cumbersome and illiquid asset in their eyes.
Just like Goldman Sachs today, which is already quite strong, although not as powerful as it is in later years, it is still considered a top-tier investment bank on Wall Street, yet it still chooses to lease its offices instead of owning the properties.
This is the mindset of bankers: money should be used to make more money, not tied up in bricks and cement.
But Lin Haoran is different. He has the perspective of a time traveler and knows how much real estate prices in core global cities will rise in the next few decades.
This difference in perception is his greatest advantage.
Moreover, for Lin Haoran, the financial industry was just a place to make quick money occasionally.
Even if you make quick money, you still have to invest it.
He cannot repeatedly invest all these funds in the financial industry; otherwise, he will sooner or later become the public enemy of major global financial conglomerates.
His strategy is to develop steadily and discreetly, and to seize opportunities when they arise.
"By the way, Mr. Lin, there's a special guest at tonight's banquet who wants to see you, so I've come to ask for your opinion." Walter Riston stopped talking about commercial real estate and went straight to the point.
"Oh? Mr. Walter, please tell me, who is this special guest?" Lin Haoran asked in surprise.
He guessed, could it be the mayor of New York?
If it were the mayor or governor of New York City, this would be quite normal. After all, his arrival in the United States would certainly not be kept secret from these politicians. Given his current status in the business world, it wouldn't be surprising if even the president wanted to meet with him.
However, Walter Riston's words refuted his idea.
Walter Riston said with a smile, "Originally, the banquet tonight was planned for just a dozen or so senior executives from Citibank to attend, as a welcome dinner for Mr. Lin."
Just then, NBA Commissioner Larry Bryan called to say he would be visiting that evening and hoped to have dinner with me. Citibank is one of the bondholders of NBA teams, so I couldn't refuse directly. Therefore, I told him that I wanted to host a dinner for him, but I was too busy to go.
I didn't expect that when President O'Brien heard that you were there, he shamelessly asked me to bring him along, saying that he wanted to talk to you about the NBA.
Mr. Lin, as you know, Citibank and the NBA have business dealings, and I can't just refuse directly, so I came to ask for your opinion.
I suspect he wants you to invest in the NBA to alleviate its current financial difficulties. If you find that inconvenient, I will decline his offer. (End of Chapter)