U.S. SECRETARY OF STATE |
Photo by Getty Images | Madeleine Albright served as Bill Clinton’s Secretary of State from 1997 to 2001. She was born in Prague and emigrated to the United States with her family as a seven year old in 1948 after a coup d’état by Communist forces backed by the Soviet Union saw her country Czechoslovakia fall under the control of Moscow. She was an influential and principled politician and diplomat who served her country well. She died a year ago (2022) and now her Georgetown row house has been placed on the market by her estate. |
Many famous people in the world of politics foreign policy, national security, and diplomacy passed through the doors of that house after she and her then-husband Joe Albright bought it in 1968 for about $100,000 US. It is on the market for $4 million US. The listing agency is Sotheby’s International Realty.
The house was built in 1853, has four bedrooms, and has around 4,000 square feet of living space. I appreciate the distinguished feel or the place, inside and out, but also its lack of pretension, two qualities I observed in Ms. Albright during her tenure as Secretary of State.
The house was built in 1853, has four bedrooms, and has around 4,000 square feet of living space. I appreciate the distinguished feel or the place, inside and out, but also its lack of pretension, two qualities I observed in Ms. Albright during her tenure as Secretary of State.
The house has a red brick façade, iron railings out front that are wrapped in ivy, and a stone fountain built into the brick wall in the rear courtyard.
The garden is large for the Georgetown area. There is also an oversized double garage which served as a watch room for security personnel when she was secretary of state. It contained security camera monitors and secure communications links.
Public spaces were limited to the first floor – Ms. Albright lived on the 2nd and third floors.
The second floor contained her library where her chief of staff said she would watch the evening TV news, read, and review materials for the next day of diplomacy or teaching, which she did at Georgetown University.
The second floor contained her library where her chief of staff said she would watch the evening TV news, read, and review materials for the next day of diplomacy or teaching, which she did at Georgetown University.
According to Ms. Albright’s chief of staff, she began hosting monthly parties for friends and colleagues at her residence about the time she and her husband divorced in 1983. The large, double living room on the first floor has two wood-burning fireplaces and would reportedly be packed with chairs so visitors could hear talks given by cabinet officials, senators, and other political dignitaries.
Critics liked to call these gatherings ‘salons’, but Ms. Albright felt that description was too grand. In her autobiography she, wrote:
“The truth is my house is comfortable, not elegant, and my dinners were simple buffet affairs – salad, roll, and a slice of something. As one participant told a reporter, anonymously, ‘We certainly don’t go there for the food.’”
Critics liked to call these gatherings ‘salons’, but Ms. Albright felt that description was too grand. In her autobiography she, wrote:
“The truth is my house is comfortable, not elegant, and my dinners were simple buffet affairs – salad, roll, and a slice of something. As one participant told a reporter, anonymously, ‘We certainly don’t go there for the food.’”
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Isadore Sharp, September 2023. The Globe and Mail, Report on Business. | Few people remember that the Four Seasons hotel chain was founded by a Canadian. Isadore Sharp, 92, is one of our country’s great entrepreneurs and, by all accounts, an all-round nice guy. We Canadians wouldn’t have it any other way. https://fortune.com/2016/03/29/four-seasons-hotels-isadore-sharp/# Sharp didn’t inherit his wealth. Every penny was earned through hard work and innate business smarts. He spent his summers as a kid working in construction and admired the tough, give-it-all-you’ve-got work ethic of his fellow labourers: Poles, Italians, & Jews, people who Sharp said never complained. |
Sharp started out literally building hotels. He had seven in operation in 1976 and two more under construction. In 1986 he owned 18 hotels.
But recession hit in the 1980s. The hotel business is tough at the best of times, but when the global economy falters, travel is one of the first discretionary spending items that businesses and consumers trim. Hotel owners must have deep pockets to survive.
But recession hit in the 1980s. The hotel business is tough at the best of times, but when the global economy falters, travel is one of the first discretionary spending items that businesses and consumers trim. Hotel owners must have deep pockets to survive.
The global COVID shutdown is the most recent example of how exposed the leisure industry is when economic grow goes south. The prime lending rate today is 7.2%, which seems high. But for context, it hit 21% in 1981. Try making your properties cash flow using that benchmark!
The Four Seasons chain was well positioned though going into the 1980s. It owned major hotels in London (England) and Toronto that were still cash flowing - a reminder that no matter what interest rates do, the first way you make on real estate is through your purchase price. Pay too much, and basic economics will always come back to bite you.
But when interest rates hit the low 20’s, banks began to get nervous and needed to know how Sharp would pay back his loans, and not just manage the interest.
Sharp’s response was: 21% interest rates are temporary. They won’t stay at that level forever. I’m a successful businessman and will continue to be in the future, as long as you keep loaning me money.’
In Sharp’s telling, the bank – Scotia Bank –said, “Forget it. Your collateral doesn’t even support the loan you’ve already got.”
The banks’ solution was, pledge all your personal assets, your house, and your stock. If you want us to back you, then back yourself. Go all in!
“My accountants and lawyers told me not to do it. But I said to the bank, “If I do this, will you guarantee that you will continue to lend me this money as long as we need it?” They said yes. So, I pledged everything. It was a good lesson, because they did live up to it. They gave me more money, the interest rates did go back down, business did flourish, and I could pay it back. That was the Bank of Nova Scotia. They lent me my first dollar going into the hotel business and have never, ever said no.”
https://www.theglobeandmail.com/business/rob-magazine/article-still-sharp-how-isadore-sharp-built-a-luxury-hotel-empire/
In the legend of Issy Sharp, this was an inflection point in his business career that changed his life.
“My accountants and lawyers told me not to do it. But I said to the bank, “If I do this, will you guarantee that you will continue to lend me this money as long as we need it?” They said yes. So, I pledged everything. It was a good lesson, because they did live up to it. They gave me more money, the interest rates did go back down, business did flourish, and I could pay it back. That was the Bank of Nova Scotia. They lent me my first dollar going into the hotel business and have never, ever said no.”
https://www.theglobeandmail.com/business/rob-magazine/article-still-sharp-how-isadore-sharp-built-a-luxury-hotel-empire/
In the legend of Issy Sharp, this was an inflection point in his business career that changed his life.
The Four Seasons chain was well positioned though going into the 1980s. It owned major hotels in London (England) and Toronto that were still cash flowing - a reminder that no matter what interest rates do, the first way you make on real estate is through your purchase price. Pay too much, and basic economics will always come back to bite you.
But when interest rates hit the low 20’s, banks began to get nervous and needed to know how Sharp would pay back his loans, and not just manage the interest.
Sharp’s response was: 21% interest rates are temporary. They won’t stay at that level forever. I’m a successful businessman and will continue to be in the future, as long as you keep loaning me money.’
In Sharp’s telling, the bank – Scotia Bank –said, “Forget it. Your collateral doesn’t even support the loan you’ve already got.”
The banks’ solution was, pledge all your personal assets, your house, and your stock. If you want us to back you, then back yourself. Go all in!
“My accountants and lawyers told me not to do it. But I said to the bank, “If I do this, will you guarantee that you will continue to lend me this money as long as we need it?” They said yes. So, I pledged everything. It was a good lesson, because they did live up to it. They gave me more money, the interest rates did go back down, business did flourish, and I could pay it back. That was the Bank of Nova Scotia. They lent me my first dollar going into the hotel business and have never, ever said no.”
https://www.theglobeandmail.com/business/rob-magazine/article-still-sharp-how-isadore-sharp-built-a-luxury-hotel-empire/
In the legend of Issy Sharp, this was an inflection point in his business career that changed his life.
“My accountants and lawyers told me not to do it. But I said to the bank, “If I do this, will you guarantee that you will continue to lend me this money as long as we need it?” They said yes. So, I pledged everything. It was a good lesson, because they did live up to it. They gave me more money, the interest rates did go back down, business did flourish, and I could pay it back. That was the Bank of Nova Scotia. They lent me my first dollar going into the hotel business and have never, ever said no.”
https://www.theglobeandmail.com/business/rob-magazine/article-still-sharp-how-isadore-sharp-built-a-luxury-hotel-empire/
In the legend of Issy Sharp, this was an inflection point in his business career that changed his life.
Another game-changing decision was his decision to
by the Regent International Hotel business in 1992,
which elevated the Four Seasons brand to the inter-
national stage. Sharp paid $122 million USD for 100%
ownership of Regent. In return, he received 10
hotels and five that were under development. This
boosted the Four Seasons to 43 properties and made
it the world’s largest luxury hotel chain.
The deal was quite as straight forward though as my previous sentence makes it out to be. It is the unique structure of Sharp’s offer that sealed the purchase, becoming another inflection point in his storied career.
Regent’s debt was owned by Japanese banks and they were suffering as Japan’s 1980’s real estate bubble to bust, beginning a long and painful slide into economic decline from which Japan has still not emerged.
This made Regent a distressed seller, and distressed sellers are always targets for deal-hungry buyers who can smell blood in the water.
Sharp faced major competition to win the battle for Regent. He won the day by putting together a unique deal structure that worked for both sides of the transaction
He agreed to the Japanese banks’ asking price. No haggling on that.
But he allowed the banks to remain ownership partners and share in the Regent chain’s anticipated future profits. The banks kept their ownership stake in Regent International Hotels, an impossibly enticing offer because it prevented a massive write down caused by a fire sale price. This was a massive win for the banks because it kept their balance sheets clean.
The Four Seasons didn’t actually buy bricks and mortar. Instead, Sharp bought the hotels’ management contracts. So, the banks remained owners and looked after all future capital expenditures, which is significant because hotels require constant updates and refreshes. The Four Seasons however, became the operations brain of Regent Hotels. They put the luxury service into Regent’s luxury hotels, which is what their guests were looking for
A classic win-win. The banks were made whole. Sharp outsmarted the competition. And the Four Seasons became a global player in the luxury hotel game.
Issy Sharp’s last major career inflection point was spread over two separate dates. In 1995, he sold a quarter of his Four Seasons shares to a member of the Saudi royal family. Then, in 2007, the same Saudi prince teamed up with Bill Gates’s holding company to buy 95% of the company. The price: $3.8 billion USD.
https://financialpost.com/news/four-seasons-founder-issy-sharp-eyes-expansion-backed-by-bill-gates-and-prince-al-waleed
In sum, Sharp made his fortune, lived an active business life, and cashed in his chips at a date of is choosing and on his own terms. In doing so, he avoided the succession ignominy of passing on a great company to progeny who – if history is any indication (from shirt sleeves to shirt sleeves in three generations’, is the old saying) – might have run it into the ground.
https://financialpost.com/news/four-seasons-founder-issy-sharp-eyes-expansion-backed-by-bill-gates-and-prince-al-waleed
In sum, Sharp made his fortune, lived an active business life, and cashed in his chips at a date of is choosing and on his own terms. In doing so, he avoided the succession ignominy of passing on a great company to progeny who – if history is any indication (from shirt sleeves to shirt sleeves in three generations’, is the old saying) – might have run it into the ground.
An official portrait of Isadore Sharpe which hangs in the
Four Seasons Hotels & Resorts headquarters in North
York, Toronto.
Four Seasons Hotels & Resorts headquarters in North
York, Toronto.
The real Isadore Sharp standing in front of his portrait.
https://www.babailov.com/isadore-sharp-four-seasons-hotels
https://www.babailov.com/isadore-sharp-four-seasons-hotels
Cameron Morrell
Business Educator
Real Estate Developer
Social Impact-Entrepreneur
Venture Capitalist
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