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Tuesday, November 25, 1997

Analysis of Ross Perot Jr.'s empire reveals an aggressive but selective investor

FORT WORTH, Texas (AP) - In just the past 10 years, Ross Perot Jr. has purchased interests in a movie studio, an Austin marina, upscale California mountainside homes, the Dallas Mavericks basketball team and at least three Texas airport developments.

Among his most recent projects are a 440-acre office park in suburban Atlanta with a hotel and hospital, and nearly a dozen projects along the California coast. He is also marketing U.S. corporate sites to Asian and Pacific Rim companies and has set up companies aimed at the burgeoning international markets in Asia, Europe and the Middle East.

A computer-assisted analysis of Perot's multimillion-dollar holdings reveals a fortune built by buying bankrupt and undervalued properties and turning them around, the Fort Worth Star-Telegram reported in Monday's editions.

Based on property tax appraisals, business filings and other public documents, the analysis shows his empire spreads among almost 200 companies.

In North Texas, Perot and his father own 21,000 acres in six counties valued by tax appraisers at more than $500 million.

And in at least 25 U.S. cities, Perot has major holdings, some in major real estate markets.

Over the past five years, deed records reveal thousands of land transactions in more than a half-dozen states. Perot's deep pockets allow him to invest in floundering projects and bank on turning them around.

"Our best investments came at a time when the market was flat, when we used our capital as kind of a bulldozer instead of a scalpel," said Perot's top lieutenant, Frank Zaccanelli. "And our best investments were at a time when the market was void of capital and we used our cash to be able to buy from the RTC, the FDIC or to restructure debt for companies that became insolvent."

Public records show Perot is an aggressive but selective investor who buys golf resorts, subdivisions and shopping centers.

As always, Perot officials declined to discuss the dollar value of any holdings.

Private financial analysts have estimated yearly revenues of Perot's umbrella company, Hillwood Development Corp., at $16 million. The company ranks among the top 20 commercial property managers in Dallas, according to the Dallas Chamber of Commerce, with 2.6 million square feet of industrial, corporate and retail space.

Perot's ability to envision what sliding real estate projects could produce if reinvented is responsible for his success in creating a reputation apart from his father's, real estate experts say.

"Even though I know Ross Perot is his father, Ross has established his own reputation as one of the premier developers in the country," said Dennis Donovan, a New York-based corporate real estate consultant. "He's got a reputation in his own right, primarily because of Alliance, but they have industrial parks throughout the country."

Many of Perot's holdings are relatively modest, such as 200 acres of undeveloped land in rural Kaufman County southeast of Dallas and a strip shopping center near Alliance Airport with a gasoline station and a Wendy's restaurant.

But Perot says he devotes his attention to big-dollar deals and opportunities.

"Because of Alliance, we get phenomenal opportunities," he said.

His booming Park Glen subdivision in far north Fort Worth is bigger than many cities. His sweeping plan for a new downtown Dallas arena calls for scores of storefronts, restaurants and apartments.

Perot's most recent major buys have been in places such as Hawaii, where real estate prices are on a downswing.

He recently bought into Maui Lani, a 50-acre gated community of $350,000 homes near central Maui, Hawaii.

"It was close to bottom in the cycle, and that's the way we like to acquire property," said Ron White, president of residential development for Hillwood. Send a Letter to the Editor about This Story | Start or Join A Discussion about This Story
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