Howard Michaels raised vast sums for some of New York’s top developers as head of the Carlton Group
Howard Michaels, a pugnacious capital-markets broker who became a lifeline for some of New York’s biggest projects and developers, died Friday. He was 62.
The cause of death was cancer, sources said.
Michaels formed his firm, the Carlton Group, in 1991. Carlton has completed over $140 billion in financing deals, the firm said in a statement Friday.
“His intelligence, tenacity and dedication were great assets to Carlton and helped expand the company from a single office on Park Avenue South to now having multiple offices across the globe,” the firm said. Michael Campbell, a partner at Carlton, will assume leadership of the firm. When reached by phone, Campbell said that Michaels was “working all the way up till the end.”
“Deals had to get done,” Campbell added. “His sickness wasn’t going to slow him down.” The firm, which has 32 brokers, had been preparing for the news and is organized to carry on in his stead, Campbell said.
Born in Flatbush, Brooklyn, in 1955, Michaels started his career as a sales rep at conglomerate 3M, selling copy machines at the very buildings he would later finance.
“I was making bupkis,” he said in an interview with The Real Deal about his start. He went on to work at Island Planning, a Manhattan-based real estate syndicator, learning the trade at a time when it didn’t have competition from some of the more complex financial instruments available to investors today.
“By the time I was 30,” Michaels recalled, “I had a chauffeur-driven limousine, I had a day driver, I had a night driver, I had a house in the Hamptons.”
He struck out on his own in the 1990s and soon developed a niche in arranging financing for hairy transactions that banks wouldn’t touch. In 2006, for example, an underwater Harry Macklowe desperately needed funds to pay off his creditors Vornado Realty Trust and George Soros on his ill-fated purchase of the GM Building. Michaels brought in Jamestown, which agreed to invest $300 million. He also said he arranged more than $500 million in financing for Kushner Companies to pay off its mezzanine lenders at 666 Fifth Avenue.
“What does everybody in real estate want? OPM — other people’s money,” Michaels said. “So I decided I was going to become the best person at arranging deals with other people’s capital.”
“As an outsider looking in, it seems he was the first mortgage broker to take the business to that next and bigger level both in terms of size of transactions and the different aspects of debt and equity,” said Ira Zlotowitz, founder of mortgage brokerage Eastern Union. “He was one of the people who opened my eyes to what’s possible.”
Along the way, however, Michaels developed a reputation for being an extremely tough boss, with detractors often comparing him to “Ari Gold,” the mile-a-minute superagent played by Jeremy Piven in “Entourage.” His company stood out even in the brutally competitive real estate arena, epitomizing the #NoDaysOff philosophy with Sunday-morning conference calls.
“Carlton is not for the fainthearted,” Michaels said in response to criticism about his reputation. “If you’re not serious about work, this is probably not a good place. But if it’s someone who’s motivated and wants to do well, this is a great place to work.”
More recently, he helped arrange construction financing for HFZ Capital Group’s 76 11th Avenue, the Bjarke Ingels-designed two-tower condo and hotel project.
“He was relentless,” said Nir Meir, a principal at HFZ. “No pusher like him. The guy was very colorful, very entertaining – it’s a big loss.”
Michaels was also a minority investor in the hotel-and-retail project known as 20 Times Square, but was recently bought out.
Funeral services are being held on Sunday at noon at Central Synagogue.
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