Paul Reichmann

Family origins

The Reichmann family is originating in Hungary. In the Twenties, Samuel Reichmann (the father of Paul) decided to leave to settle in Vienna to settle there like walking of eggs in the ultra-orthodoxe district of the city.

By an incredible chance, the family is apart from Vienna at the time of Anschluss in 1938; all will be thus saved and they will leave for Paris then for Tangier to the Morocco where Samuel settles as banker whereas Renee, the mother of Paul, deals with charitable works to save a maximum of Jews of Eastern Europe.

Paul makes brilliant studies in several talmudic schools between England and Israel to become Rabbin. But as soon as it obtains its diploma, it decides to leave to join his Edouard brother with Montreal which began a small company of real estate with his/her two other brothers (Albert and Raph).

Successes in North America

As of their arrival with the Canada, Paul and Albert leave to create a branch with Toronto. The city knows in the Sixties a rapid growth as a financial center of Canada. It founds in 1964 the company Olympia & York which will remain the name of the future real empire of the family.

The first great project entrusted to O&Y is the " First Canadian Place" (a building of more than 70 stages, largest of Canada at the time). Then Paul turns to New York which in the Seventies is in full crisis of the real estate. He repurchases for 300 million dollars of credits at a company in bankruptcy to resell them later 6 years for 3 billion. He develops the complex of Battery Park under the name of World Financial Center (it is about ten scrapes-ciels which surrounds the World Trade Center on the level of Wall Street) which will be inaugurated with beginning of the year 80.

In 1985, the Canadian government calls upon Reichmann to maintain under Canadian house the oil company GULF. Reichmann accepts but he asks in counterpart a tax reduction several hundreds of million dollars. The file is ventilated by the press of Toronto which is then put to burn what she had adored. A very polemical article is published then on the origins of the fortune of Samuel Reichmann who would have adulterated with the Nazis from Tangier. Paul answers with vehemence so that it names slandering. He obtains the excuses of the press but also a strong resentment of the journalists who will do all to destroy it thereafter.

Canary Wharf: Rise and fall

However Paul and his Albert brother are then one of 10 greater world fortunes and still cause the fascination of the press new yorkaise. At the top of glory, Margaret Thatcher request personally in Paul to become the financier of the real great project of his mandate: the development of the East of London which will have to become a news “City”.

This project, known under the name of Canary Wharf, that nobody wants to finance because no underground line arrives in the zone, will become the tomb of the Reichmann empire which will believe in Thatcher which promises that Jubilee Line will be quickly open (it will be to it only 10 years later by Tony Blair). Reichmann starts by absorbing 5 billion dollars there to build the project which it supervises personally. But in fact especially the 90 banks end up wearying inoccupation of the buildings which will be quasi-total between 1985 and 1995.

Olympia & York are thus put in bankruptcy in 1992 leaving a hole of 20 billion dollars. It is one of the most important bankruptcies of the History. Albert then decides to devote himself to his foundation for the assistance of the Jews of Eastern Europe and Paul supported by an small group of financial faithful (whose George Soros) manages to take again the control of Canary Wharf which appears finally profitable. It resells its share with Morgan Stanley in 2005. With the last estimates, its fortune would be still higher than 1 billion dollar.

Methods of the Reichmann family

Paul is characterized by the secrecy in the businesses and a modesty which fascinated the media during the years of glory. The respect of the word given seems to be also in the center of its vision of the businesses. That corresponds to the methods suitable for ultra-orthodoxe the Ashkénazes. It will use its fortune for Jewish works of the whole world and will refuse that its employees do not work during the days of Jewish holidays and Shabbat.

A share of shade remains very strong nevertheless when with the relation of the Reichmann family with the political powers. It is true that the projects are often Pharaonic and thus politically sensitive but one can have the impression that, without falling into direct corruption, the family always knew to negotiate in extreme cases of the law with the capacities in place:

* the first contracts obtained on Montreal were carried out without respecting the town-plannings of the time (in particular as regards many stages)

* the attribution of the contract of installation of Battery Park was negotiated n the other hand of the repurchase of loans emitted by the town hall of New York which was, at the time, in quasi-bankruptcy

* the business of the tax reduction allotted by the Canadian government for the repurchase of the GULF

* the negotiations with Magaret Thatcher for Canary Wharf were done directly with the 10 Downing Street during long discussions

It seems, towards the end of its career, to have suffered from a feeling of infallibility which contributed to its failure. It will remain in the history of Anglo-Saxon capitalism like a player of great talent, which always knew to give on the carpet much more than its own money to be able to draw up “extraordinary projects and to the limit of impossible” (according to its own terms at the time of a Press conference on Canary Wharf).

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