By: JV Staff
Will Rogers once famously advised a friend to “buy real estate – they ain’t makin’ any more.”
Sounds like a reasonably reliable formula for success — and it is.
So how come so many moguls, tycoons, wizards, magnates, nabobs, bigwigs, personages, captains of industry and just plain smart business people involved in real estate want more than that? At times, so much more that they run afoul of the law?
This is real estate’s Dark Side, the industry’s seamy underbelly comprised of shady deals, broken promises and unlimited amounts of greed and ambition – and which few casual observers even realize exists until it splashes across the pages of the scandal sheets.
The Jewish Voice wants to lay bare this too-often hidden side of the world of big-time real estate and the people who run it so that our readers know the full story — the lay of the land, and where the bodies are buried underneath it. In this week’s installment, we present to you three women who made their dubious mark on the industry they represented and whose reputations were severely tarnished in the process.
Tales from “The Queen of Mean” – Leona Helmsley
They called her the “Queen of Mean.” The New York daughter of Polish Jewish immigrants, Leona Helmsley ended up becoming a billionaire- worth $8 Billion according to the BBC. She dominated NY headlines as a mean-spirited real estate mogul who famously said “We don’t pay taxes; only the little people pay taxes” during her infamous tax evasion trial.
Leona Mindy Rosenthal was born on July 4th, 1920 in Marbleton, NY to Ida, a homemaker, and Morris Rosenthal, a hatmaker, according to Moss Michael’ s book “Palace Coup”. Her family moved to Brooklyn while she was still a girl and moved six more times before settling in Manhattan. After dropping out of Abraham Lincoln High School in the Brighton Beach section of the borough to seek her fortune, she changed her name several times over a short period – from Lee Roberts, Mindy Roberts, and Leni Roberts – before finally going by Leona Mindy Roberts and having her surname legally changed to Roberts, according to the NY Times.
In 1968, while Roberts was working as a condominium broker, she met and began her involvement with the then-married real estate entrepreneur Harry Helmsley, the Orlando Sentinel chronicled. Harry began a program of conversion of apartment buildings into condos. He later concentrated on the hotel industry, building the Helmsley Palace Hotel on Madison Avenue, according to Richard Hammer’s book “The Rise and Fall of Harry & Leona”. By the beginning of 1989, twenty-three hotels in the chain were directly controlled by Leona Helmsley.
On March 31, 1982, Helmsley’s only child, Jay Panzirer, died of a heart attack resulting from arrhythmia. In a cold-hearted move, which helped earn her the nickname “the queen of mean”, she evicted her son’s widow, who lived in a property that Helmsley owned. She went one step further, displaying her greed and wickedness as she successfully sued her son’s estate for money and property that she claimed he had borrowed, and she was ultimately awarded $146,092!!
Although, she was known for her cruelty to employees, she was also known for her charitable contributions. After the 9/11 attacks, Helmsley donated $5 million to help the families of New York City firefighters and police. Other contributions included $25 million to New York–Presbyterian Hospital for medical research, The NY Post reported.
However, her cruelty made the headlines.
The slightest mistake was usually grounds for firing, and Helmsley was known to shout insults and obscenities at targeted employees just before they were fired; and at the same time she was known as charitable.
Helmsley acquired the moniker “The Queen of Mean”, reportedly inspired after an advertising campaign promoting her as the “Queen of the Palace” of the Helmsley Palace Hotel, the NY Times explained. Helmsley became known by this nickname in the mainstream press. The NY Post recalled a story by world renowned trial lawyer Alan Dershowitz. While breakfasting with her at one of the Helmsley hotels, she received a cup of tea with a tiny bit of water spilled on the saucer. Helmsley grabbed the cup from the waiter and smashed it on the floor, then told him to beg for his job.
She was also famously known for not paying her bills. Contractors were hardly ever paid on time-if at all – and many people filed lawsuits to recover even just a portion of what they were owed, History.com reported.
The trouble for the Helmseys began in 1983. They bought a 21-room mansion in Greenwich, Connecticut, to use as a weekend retreat. The property cost $11 million, but the Helmsleys wanted to make it even more luxurious. The work included a $1 million dance floor, a silver clock and a mahogany card table. The remodeling bills came to $8 million, which the Helmsleys were refusing to pay. A group of contractors sued the Helmsleys for non-payment and the Helmsleys eventually paid off most of the debt owed to the contractor, according to an article entitled ‘Rich Bitch” which appeared in the New Yorker magazine.
During a 1985 court proceeding, the contractors defense team, revealed that most of their work was being illegally billed to the Helmsleys’ hotels as business expenses.
The contractors presented all their information to the N.Y Post. This media expose resulted in a federal criminal investigation.
The trial was delayed until the summer of 1989 due to numerous motions by the Helmsleys’ attorneys with most of them related to Harry’s health. “He had begun to appear enfeebled shortly after the beginning of his relationship with Leona years before and had recently suffered a stroke on top of a pre-existing heart condition” an old Court TV documentary recalled.
Leona had to face the charges alone in the now infamous trial. The most shocking memory of the trial was when the “Queen of Mean” stated: “We don’t pay taxes; only the little people pay taxes”
On August 30 of that year Helmsley was convicted on one count of conspiracy to defraud the United States, three counts of tax evasion, three counts of filing false personal tax returns. sixteen counts of assisting in the filing of false corporate and partnership tax returns, and ten counts of mail fraud, Wikipedia researched. She was, however, acquitted of extortion—a charge that could potentially have sent her to prison for the rest of her life.
Helmsley was instead sentenced to sixteen years in prison, which was eventually reduced when all but eight of the convictions were dropped, Court TV recalled. Her new attorney, former Harvard law school professor Alan Dershowitz. successfully appealed a reduced sentence and she was ordered to report to prison on Tax Day, April 15, 1992. She was released from custody on January 26, 1994, after serving nineteen months. Her husband died in 1997.
Leona Helmsley died of congestive heart failure at the age of 87, on August 20, 2007, at Dunnellen Hall, her summer home in Greenwich, Connecticut.
In death, she managed to shock the public and gave the media one more eccentric story.
Helmsley left the bulk of her estate—estimated at more than $4 billion—to the Leona M. and Harry B. Helmsley Charitable Trust., according to records.
The trust supports a wide range of organizations with a major focus on health and medical research, in addition to conservation, education, social services, and cultural access, according the trust’s website.
In addition to providing directly for her own dog in her will, she left separate instructions that the trust, now valued at $5 to $8 billion, be used to benefit dogs; going to organizations that focus on the wellbeing and care of dogs, The court ruled the trust could not be changed to comply with her wishes. The trust had to abide by the original documented purpose of charity.
The media exploded when it was learned she left $12 million to her own dog; a Maltese named ‘Trouble.” The courts lowered the amount to $2 million, which went to Carl Lekic, the general manager of the Helmsley Sandcastle Hote who had formerly cared for her pet, which died in 2010.
Helmsley had four grandchildren. Two of them each received $5 million in trust and $5 million in cash and in typical “Queen of Mean” style, two grandchildren received nothing, according to the will. She left $15 million for her brother, Alvin Rosenthal. Helmsley also left $100,000 to her chauffeur, Nicholas Celea.
And what about the other $10 million that Leona’s dog “Trouble” was supposed to receive? $4 million was awarded to the Charitable Trust, and $6 million was awarded to the two grandchildren who received nothing originally, after being disinherited in the will. The ruling required that both grandchildren keep silent about their dispute with their grandmother, as reported by NBC.
“Queen of Retail” – Faith Hope Consolo & Her Fake Pedigree
Many came to know her by the moniker “Queen of Retail” while others came to know her as a hard driven business woman who would eat her competition alive without any mercy.
Who really was Faith Hope Consolo, the woman who chaired Douglas Elliman’s retail division until her death in 2018 and brought top global brands to the city’s real estate market?
The Real Deal reported that during the course of her 25-year career, Consolo has represented some of the city’s most high-profile landlords, names like Trump, Helmsley and Silverstein. Moreover, she played a pivotal role in the European retail invasion, billing herself as an ambassador of sorts for the city, and helping to find early local outposts for chichi names like Gianni Versace, Cartier and Fendi, as was reported by the Real Deal.
But Faith Hope Consolo remains as much of an enigma in death as she was in her colorful and controversial life.
According to a report in January that appeared on the Real Deal web site, Consolo was not particularly candid about her upbringing and her mendacity eventually became quite apparent.
She had told her friends and associates that she was born to a family of achievers and considered herself privileged; having attended the right schools and making the right connections that would further her career in the luxury New York City real estate scene.
Rather than being raised in opulence and finery, Consolo was brought up in a small house near Coney Island Avenue in the Sheepshead Bay section of Brooklyn. Her father was not a real estate executive and her mother was not a child psychiatrist as she had proffered to those in her orbit. Rather, the truth is her father did not die when she was a very young child, but lived to the ripe old age of 94. According to the Real Deal report, the elder Consolo had an extensive criminal background. The New York Times reported that her father did some hard time in a federal penitentiary in Kansas and at Alcatraz for gambling, armed robbery and dealing heroin.
Her mother was a hairdresser at a department store in downtown Brooklyn, despite Consolo’s fraudulent assertions.
The NY Times could also find nothing to corroborate Consolo’s claims that during the 1970s, she opened an interior design business and a modeling agency on the West Coast.
After graduating from NYU with a degree in art history, Consolo went to graduate school at the Parsons School of Design in New York City and Paris, then worked for a time as an interior designer at a New York City architectural firm, according to the Real Deal report. In between she got “married a couple times.” The marriages were “brief, not much to talk about,” she said.
According to the Real Deal, Consolo’s business partner at Elliman, Joseph Aquino never really knew the truth about Consolo because of the fake pedigree that she was spewing forth.
In 2016, the Real Deal reported that Aquino & Consolo were tangled in a rancorous legal dispute over what he claimed was her profligate lifestyle and overly excessive spending habits. Competitors throughout her storied career in real estate have always contended that Consolo was an insatiable press hound; always vying for publicity and she often took credit for the deals that others had worked so hard to make.
The New York Times had called Consolo the “highest-profile practitioner of the art of matching stores and storefronts.” The New York Post said she’s the “queen of retail.”
The Real Deal reported that she also brokered deals for top international brands such as Cartier, Zara and Louis Vuitton.
“She really changed the retail marketplace,” Rudin Management’s Bill Rudin told the newspaper. “Her street smarts and entrepreneurial spirit and flair — even the way she dressed and communicated — attracted an amazing clientele, some of the great international brands, to New York.”
Consolo, however, generated a great deal of animus and mistrust amongst her colleagues and business associates in the highly competitive industry that she was a major player in. When queried about Consolo, several brokers swore like drunken sailors, according to the Real Deal.
One broker said: “I have a picture of the real Faith. She’s no Madonna.”
As the Real Deal reported, broker C. Bradley Mendelson, of Cushman & Wakefield, echoed comments made by no less than eight other competitors, who complained that “either through actual lies, or innuendo, she takes credit for everyone else’s transactions.”
In the 1990s Mendelson landed up in court battles with Consolo, as was reported by the Real Deal, over a commission for the Toys “R” Us lease near Times Square. “You hear that she was singlehandedly responsible for bringing every tenant there ever was to New York City. She’s never been a force in the industry. She’s a legend in her own mind,” he said.
Jeffrey Winick of retail powerhouse Winick Realty Group told the Real Deal in their report that: “Faith is all hype; if she can tell me 10 deals she’s done in the last 10 months, it would be a miracle. She writes her own stories. That’s all she does — is write.”
Other contemporaries of Consolo have legitimately griped that she took too much credit for the retail transformation of a number of New York City neighborhoods, including Soho, the Flatiron District and Times Square.
The NY Times report indicated that Consolo took “credit for leases that had been negotiated by competing brokers, and she was caught making false claims based on nonexistent reports. Over the years, publications were forced to issue retractions, and she gained a reputation for exaggeration.”
Annetta Powell & Real Estate Fraud
Sometimes, a few of the malefactors who inhabit the real estate business are able to turn their lives around and actually become a force for good.
Case in point: Annetta Powell.
Her story is impressive, having grown up just outside Detroit with two deaf parents and seven brothers and sisters. She was working a job as a materials coordinator for Johnson Controls when she decided to take control of her career. Powell bought her first real estate property for $18,000, eventually flipping it for $42,000. She estimates that over the past 18 years, she has bought, fixed up and flipped over 600 properties and notched sales in excess of $50 million.
“But the journey for Powell ain’t been no crystal stair,” reported blackenterprise.com. “She clawed her way to reach every step only to have her progress impeded repeatedly with adversities such as domestic violence and a brutal sexual assault. Forging ahead, she leveraged her industry knowledge, published her first real estate book, and started conducting training seminars in 2007.
The following year, however, she was investigated for real estate fraud and later indicted in 2011 for mortgage fraud assisting buyers with down payment money (funds) to p
urchase investment properties. Prior to the indictment, she completely flat-lined financially due to the housing market crash and inability to sell off investment homes. In 2014, Powell was sentenced to 24 months at Alderson Federal Prison in West Virginia, known as “Camp Cupcake” where Martha Stewart served her prison sentence.”
Out of money, she realized that she was at “a critical crossroad and the future was at stake,” the piece continues. “Yet, her entrepreneurial prowess was still in play even behind bars where she maintained an unwavering belief that nothing could keep her bound. Determined and optimistic, she knew, “all of my dreams could come true despite the hardships of my past.”
She was eventually release in 2016, and since then has dedicated herself to helping others achieve their portion of the American dream. As she proclaims on her web site, “Do you want to start a business but don’t know how or where to begin? … … Do you want to learn how to brand your company as well as yourself? Do you have a business and you are still struggling financially? Do you want to learn how to build wealth through multiple streams of income? If you said yes to any of the questions above you are definitely in the right place! I want to assure you that no matter what your current situation is you can achieve the success you dream of – just look at my life as an example.”
