Towers of Debt: The Rise and Fall of the Reichmanns/the Olympia & York Story

"Donald Trump was chopped liver when compared with the Reichmann brothers," wrote a business reporter in Newsweek. At its peak, according to Business Week, the Reichmanns' family company Olympia & York, was "the largest real estate empire on earth." The extraordinary transformation of the Reichmann financial colossus into "the world's biggest private bankruptcy filing" (Time) is the subject of Peter Foster's dramatic saga of an empire's rise and fall.
Foster's story takes in the legendary Reichmann family history: their flight across Europe ahead of the Nazis, their residence in wartime Tangier, and their establishment of a modest tile business in a Toronto suburb. From that tiny base, Paul Reichmann and his brothers, Albert and Ralph, went on to a series of real estate developments each more spectacular than the last: the pathbreaking construction of Canada's tallest building, First Canadian Place; the "deal of the century" purchase of eight Manhattan skyscrapers in 1977; and the development of New York's architecturally acclaimed World Financial Center.
At the center of these spectacular developments was Paul Reichmann. He was devout, hardworking, and modest. His word was his bond, and on the strength of his word, banks on three continents fell over one another to lend him huge sums of money in the belief that everything Paul Reichmann touched turned to gold.
Even in the late 1980s, however, there were signs that the Reichmanns were headed for a fall as precipitous as their rise. Foster provides an insider's view of the convoluted and litigious takeovers of oil giant Gulf Canada and liquor and resources conglomerate Hiram Walker. He details the bizarre flirtation with the mercurial developer Robert Campeau that cost Olympia & York $600 million. And he plots, finally, Paul Reichmann's plunge into London's dockland development, Canary Wharf, the world's most ambitious real-estate project. Conceived as a monument that would change the shape of one of the world's great cities, it instead became a $3 billion symbol of financial hubris and feckless lending.
Peter Foster has been a long-time observer of the Reichmann story. Towers of Debt, a completely revised and updated edition of The Master Builders, which was published in 1986, takes the Reichmann story to its tragic conclusion.

In this solid but lackluster report, Toronto journalist Foster has revised and augmented his account ( The Master Builders ), published in Canada in 1986, of the storied Toronto-based developers whose global real-estate empire, Olympia & York, collapsed in 1992. While the reclusive Reichmann brothers fostered a mystique based on their strict adherence to Orthodox Judaism, Foster suggests that the media, succumbing to a "strain of reverse anti-Semitism," allowed the Reichmanns to hide behind a cloak of virtuous piety. Ultimately, Foster concludes, the Reichmanns' secrecy, coupled with bankers' deference to naked wealth, allowed them to borrow huge sums of money with little scrutiny. He suggests that older brother Paul Reichmann's fatal flaw was an obsession with deals. But the family's general lack of flair--as opposed to the Donald Trumps of the world-- renders this book better as a case study than as a page-turner. 35,000 first printing.
Copyright 1993 Reed Business Information, Inc.