On Tuesday, Phelan called from Ireland. He wanted to explore time frames, how long I thought it would take before our investments would be returned. He also asked me for more specific overhead numbers, what I was estimating for tenant improvements, overhead and brokerage. I said I was putting all that together and would have it ready by the time he got back. “See you then, Jack.”
But he called the following day. “The game is on, Henry. I’m in. Congratulations. I’m looking forward to winning big with you. Also to having fun in the process. See you back in New York.”
“Jack, that’s wonderful,” I said. “And I guarantee —”
“No guarantees,” Phelan said. “In life, there are only hopes and expectations.”
“Well then, I give you my formal expectations,” I said.
“That’s better, Henry. See you next week.”
After he hung up I let out a whoop and a holler that echoed throughout the office. Hell, through all of Nassau County!
3
PHELAN returned from Scandinavia a week later.
“So, Henry, are you still inclined to proceed as planned?” he said when he called.
For a moment my heart sank. Had he changed his mind?
“Of course, Jack, unless you've had second thoughts,’
“On the contrary. The more I've thought about it, the more my elderly juices have started flowing again.”
We met three days later at the Harrison House Conference Center in Glen Cove. Only the two of us, our lawyers, and our secretaries with their trusty word processors.
Jack and I saw eye to eye on virtually everything. It was the lawyers who sometimes got caught up in various points of order or substance. Have to prove their mettle, impress their clients, I thought. But before they went on too long, like two dogs fighting over a meatless bone, Jack would step in and end the argument with a: “I don’t see that as a problem, gentlemen. Let’s go to the next point.”
Over lunch, which we shared alone, I thanked him for moving things along so quickly. And so fairly.
“Well, thank you, Henry. The point is, with the exception of something that really makes a difference, I want the basis of our new relationship to be as good for you as for me. I win that way, don’t I? Most businesspeople don’t understand that.” He took a bite of his turkey sandwich, then looked hard at me. “You’ll conduct yourself in the same manner, won’t you?”
“Of course I will,” I said.
‘When I find that you don’t, it’s out to the woodshed.” He laughed. “We Irish, in my generation anyway, haven’t forgotten the importance of certain values, including ones applied to our rear ends. You Jewish boys are familiar with that too, I’m sure.”
“Jewish-Italian,” I reminded him. He laughed and apologized for not remembering. “At the risk of sounding obsequious,” I said, “the truth is I’m very excited about this new partnership. You’re going to see stunning results.”
He stuck out his hand. “We’ll close formally next week, Henry, but as far as I’m concerned, this is a done deal. After we sign, it’s out for the best dinner in town.”
At odd moments — driving, in the dead of night, shaving — my thoughts focused on where I was at that moment in my life. I missed my father, deeply missed our conversations. My so-called family, I realized, consisted entirely of my mother and Steve. Pretty thin. And then there was Julie.
The next day, I received a call from Phelan. “Well, my boy, I have a wild idea,” he said.
“Not too wild, I hope,” I said, half seriously. “You’re supposed to be the one reining in this wild horse.”
Phelan chuckled. “It is pretty crazy,” he said, “but the more I ponder it the more I like the idea. Poetic justice has always appealed to me.”
“I think I’m getting an inkling of what you’re talking about.”
“Your building,” he said. “Yes, Three-Fifty-Five Park. What if we tried to re-acquire it?”
“Are you serious?”
“Very.” He paused, as if pondering carefully his next thought. “As you probably know,” he went on, “Federated sold the property in a package to Amalgamated and two partners. At a big discount, naturally. It could make an attractive buy, depending on the price we can negotiate. There’s bound to be a number of other bidders.”
“God, I'd love that, Jack. But there’s a problem,” I said. ‘Without tenants, we’d have to carry the building vacant. One that size? No thanks! I've been there,’
“I know you have,” he said. “But what if there was a tenant for two-thirds?”
“That of course would change the equation,” I said. “Can I ask who?”
“Not yet. That’s still completely confidential. The problem is, how to buy Three-Fifty-Five without the world finding out we have a tenant. These people can’t sign a lease subject to our procuring the building. They’re publicly owned; their attorneys won’t let them. Henry, meet me for lunch at my club. Well brainstorm.” He paused. “I have to tell you something else.”
“What?” I asked, still a bit fearful he would say he’d changed his mind.
“This is fun “ He laughed. “Gets the old blood going.”
The sellers of defaulted notes and mortgages generally make a good profit. Assume they purchase at a 50 percent discount off the fair market value and sell for a profit of 40 percent. Shopping centers, industrial and office buildings, garden apartment complexes, golf clubs, and so forth. Sometimes, they even sell a contract before having to take title. With regard to 355, they didn’t care whether we had a tenant or not. Their chief asset manager was none other than my old friend Malenti, who had left Federated and was now with the fund that had acquired this property. If we had to have the building he would have pressed for a higher price. At one point, I told him, “Look, Mr. Malenti, this is not the only property we can purchase. Seventy-one million is our best and final offer, subject to a due diligence period of ninety days, which will include the finalization of financing arrangements.”
I let Malenti stew for a few days. Now I had something he wanted — a bit different than when we originally met. Finally he called, but I let two days elapse.
“Henry,” he said, in one of the conference rooms in Cal’s law firm’s offices. “May I call you Henry?” I didn’t respond. “Look,” he continued after a few moments of silence, “your offer of seventy-one million is significantly less than the building is worth. I can sell it for a higher amount,’
“Then why haven’t you?”
“Maybe I will,” he said, “but the buyers are questionable. We’re concerned they would go to contract, try to get the money, and if they didn’t, walk. There are enough outs in any deal that would probably let them get their down payment back.”
“Well, isn’t that the situation, Mr. Malenti?”
“Yes,” he said, “but I'll tell you what —”
“No, I'll tell you” I interrupted. “We like the building and think it’s got good potential. You want us, our best price is… seventy-four million.”
“How do I know you’ve got the funds?”
I paused. “There’s a letter of credit sitting right now at Citicorp. It recites our ability to make this deal. That should be good enough.” He studied my face for a few moments and agreed it was.
We settled for seventy-four million, five hundred thousand. The agreements to purchase the deed and assign the mortgage were executed. We expected to conclude the actual lease within the due diligence period, and Jack and I would have signed our partnership agreement within that time. The prospective tenant for the building was willing to sign a letter of intent. That was critical in the negotiations for gap financing and permanent financing.
What a turnaround! Calls came in from both brokers and developers. Daniel Spear congratulated me, then inquired how I had arranged for the capital. I was not about to tell him. He asked me to play squash. I promised him I’d whip his ass.
There were other ramifications. Owning 355 again would result in tax b
enefits. Taxable deductions for interest and depreciation. The Martin Companies would own only 25 percent because we had to bring in additional investors. I had Ari and Ken revise our over-all cash flows. They indicated higher income, especially at the point when the re-acquired 355 was leased up.
I was feeling good, but I would never forget the recent scorching. I swaggered less. And Phelan wasn’t about to let me behave badly. His was respect I coveted.
About eleven o’clock on a warm September morning, I drove to the Engineers Hill Industrial Park in Plainview, to a building located on Commercial Drive, adjacent to the Long Island Expressway, the offices of a computer software company. I parked in the visitor’s area, entered the attractive, two-story lobby, and walked over to the receptionist.
“Steven Martin, please,” I said slowly.
“He’s on the phone right now, sir. Who shall I say is here?”
“An old friend. I want to surprise him.”
Shock registered on my brother’s face when he appeared. I put out my hand, which he took only after a few moments. “Steve, I wanted to see you,” I said. “Things to talk about. Let’s go for a drive.”
He hesitated, then told the young woman behind the window that he’d be back shortly. I suggested Cold Spring Harbor, where we could walk on the grounds of the Cold Spring Harbor Laboratories. I was a member of the board of directors.
“Hey, how’s your little guy?” I asked as we drove. “Haven’t seen him since the bris. He crawling yet?” Steve’s face lit up. He bubbled as he expressed the joys of being a father. I couldn’t help but feel envy.
We parked and began strolling. Yellow school buses were unloading hordes of youngsters. Their teachers had them in twos, holding hands without talking. We walked toward a bench under a large copper beech.
“I don’t know where to begin,” I said as we sat. “I see everything differently. I guess these past few months have left their mark.”
Steve looked doubtful. “Really?” he said. “Do people really change? Underneath it all, I suspect Henry Sabatini Martin is still the same person.”
I let that remark sink in. Sarcasm? Old resentment? Steve’s feelings would probably never change. Then I remembered my promise to Dad that I would always include Steve in whatever I did in business. Impossible now, but foremost in my mind was his basic insistence we remain together as brothers.
“Look, Steve, we don’t need each other. But we are family, as thin and as bad as it’s been. And it hurts Mom. If Dad were here, he would make us reconcile,” I glanced over to see his reaction, but his face was expressionless,
“Whatever I did to you over the years or whatever my effect on you was,” I went on, “you gave me back in spades,” He pulled his lips together tightly, “Still, it’s stupid for us to bear anger and grudges. Life is too short,”
“I suppose you’re right, Henry,” He stepped toward a pine cone and gave it a soccer kick, “But it’s been a whole lifetime,”
“I know. It can’t get any worse, can it? All I’m suggesting is we make a new start.”
We walked to his car and headed to his office. I was hoping he’d comment on what I had said. Though I was doing it more for Dad than for Steve, I still wanted a real reconciliation. “Henry, are you sure Joyce isn’t part of the reason?” a voice within me said. No, I responded. Gone. Over. Done with. Joyce has a new life, a good life. And I’m not part of it. But throughout the drive back, Steve limited his conversation to minutiae.
All right, Henry, you tried, I said to myself as we drew up to Steve’s office. Takes two to tango — I guess Steve’s not the dancing type,
Steve let me off beside my car in the parking lot. I got out and went over to Steve’s side. He rolled down the window.
“Mom’s flying in on Monday,” he said, “staying with us for a week or so. It would be great if you could come out for dinner. Any night. Just let Joyce know….”
He trusted me to communicate directly with his wife.
I smiled.
“I’d really like that. I may be in Wisconsin, though. I'll let you know.” We shook hands. This way, if I couldn’t make it, he’d know why and not be offended.
I got in my car and drove away, feeling better about us than I had since we were kids. Life is too short, I kept repeating as I slipped onto the expressway.
4
OUR timing to acquire the 355 building was perfect. The recession was bottoming out. Firms were adopting a more aggressive attitude and beginning to think again in terms of expansion. Larger expenditures for plant and equipment. A reduction in downsizing, even some rehiring. The change was by no means universal, but if you studied the fundamentals you could detect a shift. Disinflation was dying a much desired death. Inflation did not have to be the alternative. Alan Greenspan and the other members of the Fed seemed more attentive to the lessons of the past, when the agency resorted to draconian measures without fully calculating the consequences. If the Fed had truly learned its lesson, the nation might be able to pursue a path of sustained growth without the devastating cycles of boom and bust.
The Martin Companies, too, began to experience slow but steadily rising gross income. Financial institutions slowly began to treat us as if we were no longer Typhoid Mary.
My greatest pleasure would be in taking the calls from all those bankers and financial gurus who had refused to take mine all those months. Careful, Henry, I told myself, don’t let that ego get out of control. I could still hate their guts in my soul of souls.
Almost as pleasurable would be the prospect of proving the journalists wrong, the ones who had hovered like vultures when my company was collapsing. Now they would sniff around for stories about how I had gone from “riches to ruin and back again.” Since perception is reality, let those who read about me draw whatever conclusions they liked. It still gave me a certain buzz to see my name in the papers, but it wasn’t as important as it had been. No one cared as much as I had once believed.
I was glad Steve and I had reconciled. We would never become close, but at least we were developing something that resembled civility. During my mother’s visit, I did go over for dinner — even went so far as to play with my nephew. Joyce showed me how to change his diaper. The kid squirted me in the face.
Joyce shrieked with laughter. “Welcome, Uncle Henry! Welcome to the wonderful, carefree world of Joseph Jacob Asmund Martin.”
“Two middle names?” I asked. It was the first time I had known my nephew’s full name.
“ ‘Asmund’ for the Norwegian blood in him and ‘Jacob’ for his grandfather.” She looked over at my mother, who smiled approvingly.
Steve brought in drinks. Uncle Henry carried Joseph to the outside patio, where he placed the baby in his crib. The four adults then proceeded to have another round while Steve grilled steaks. It was a pleasant evening.
5
A CALL came in on my cellular phone when I was returning to my office the following day. It was Len. Something in his voice made me tense up.
“I’m glad I found you. I've been trying to reach you for two hours.”
“What’s wrong, Len?”
“It’s about Julie.”
“What about Julie? Has something happened to her?”
“Yes, Henry” — his voice trailed off— “I’m afraid she’s had an accident.”
“Goddamn it, I told her she drives too fast,” I said.
“Not a car accident, Henry. Plane crash.”
“Is she … ?”
“She’s alive, Henry. But busted up real bad. Any chance you can get out here? Like quickly?”
I felt faint.
“I'll charter a jet as soon as we get off the phone. Len — is she going to make it?”
“I don’t know. They’re not sure of the extent of—”
“How did it happen?” Alcohol, I was sure of it.
“A student. She was showing him how to do short field landings and takeoffs. He panicked, froze on the controls. They hit some trees at the e
nd of the runway. He’s in shock. Suffered deep cuts and braises and a broken arm, but Julie …” His voice broke.
“I’m on my way. Len, go down to the hospital and whisper in Julie’s ear that I’m coming. Will you do that for me, Len?”
“Sure. But I don't think — ‘
“Will you do that for me, Len?”
“Sure, Henry. Right away.”
I called Mid-Island Air Service and had them arrange a plane for me at Islip. They called back and said it would take about six hours to arrange for a Citation.
“If you don’t have one in two or less, I’ll call someone else.” I told them. They phoned back. A plane would be available in an hour and a half.
I didn’t want to do any of the flying. Too long since I had checked out a jet. And my mind wouldn’t have been on flying.
I sat alone in the rear, the swoosh of the jet at 41,000 feet in my ears. I began to think about Julie’s crash. Was it really her student’s fault? Or were her reactions too slow? Drinking can bite pilots. Some believe that a night’s sleep will eliminate any effects. Maybe for some, but not for others.
Julie and me, I thought. We were so different. A commitment. Do I want it? Yes. With all the warts and wrinkles? All the weaknesses and funny bones? Yes. On some issues we’re going to fight like hell. And what would I do when I ran into temptation? I’d run like hell, that’s what!
Prior to takeoff, I had called Len and given him my estimated time of arrival. He met the plane. We embraced like long-lost brothers.
“I just came from the hospital,” he said as we jumped into his car.
“The doctors think now she has a fifty-fifty chance.”
“No better?”
“That’s what they said.”
“Give me the details.”
“A broken rib punctured her lung. She’s in surgery. They’re not concerned about the lung, that’ll heal. It’s … her liver.”
“That’s not good. What about other injuries?”
“Busted leg and real bad gashes and bruises on and near her hip. She went unconscious after they hit. They’re hoping there were no head injuries.”
The Ego Makers Page 29