Filed under: Estates

There are only six photos of this New York City townhouse but they are a very evocative six pictures. This is the home of Jack and LuAnn Grubman. He’s the former lead telecom research analyst for Citigroup’s Salomon Smith Barney and as the New York Observer’s Manhattan Transfers column puts it, “a star in its telecom investment banking.” Grubman ended up banned from the industry amid a scandal involving shady dealings and had to pay a $15 million fine. He might be counting himself lucky now that he got out in 2001-2002 and isn’t a Wall Street player this day.

It seems that the he managed to squirrel away plenty of money (he did after all have a $30 million severance package). Grubman’s home is a neo-Federal mansion built in 1883. The home is a five-story mansion located steps from Fifth Avenue and the Metropolitan Museum. It has been absolutely renovated and includes a marble entrance hall, iron and bronze adorned staircase, 13′ high ceilings in the living and dining rooms with full-height oak paneling and period plaster moldings, an elevator, and an eat-in chef’s kitchen that has a dumb-waiter to the butler’s pantry off the dining room. There are two planted terraces as well as an ivy-covered south-facing garden. It is listed at $32 million.

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A PizzaWorld franchise opened near us, so my husband and I started eating there.  We found the owners friendly and the food excellent, if slightly overpriced.  They were in a good location in a growing area of town, and we were thrilled to find a good pizza place, particulary at lunchtime.  If you go to the PizzaWorld website, you’ll see the owners  giving one of the tesimonials for the franchise (she is the lady in the blue sweater).

Sadly, yesterday my husband went there for lunch and found only the realtor sign and nothing else.  They were gone.  So, my question is, who is to blame?  The franchisor or the franchisees?

Since I haven’t talked to them, I don’t know for sure, but this is what I observed:

1.  Too many employees.  On a Friday night they had at 7 high schoolers there.  One went out on a delivery and came back.  We were the only people in the place.  Why they needed 7 children to work on a slow night was beyond me.  Was that number recommended by the franchisor or were the people just too kind to tell the children to go home?  

2.  Massive portions.  I ordered a salad one time that easily could have fed me for 3 meals, and it was loaded with all kinds of good stuff.  The calzones were humungous.  Did the franchisor set the size or did these people not know about portion control?

3.  Prices high.  Pizza is a highly competitive business.  For a new pizza place to make it, they have to have fantastic pizza and low prices.  People can pay less at one of the major franchises.

4.  Breathtaking competition. In addition to the normal super-competitiveness of pizza places in general, just a couple of miles away was an old pizza place that has been in town for generations and makes unarguably the ideal pizzas in the world.  People will stand in line for an hour at this place just to get a table.  So the tiny PizzaWorld place had to convince people it was worth it to come down the road to them.  Did the franchisor not check out the competition?  Were these people new in town and didn’t realize that the local mecca was going to be impossible to overcome?

As I said, I don’t know the answers to these questions.  I do know one thing:

Even if you are buying a franchise, do your homework.  Learn about the area and the competition.  Keep your expenses low.   I’m not saying to skimp on sizes, but if something sounds like it’s not right, check it out.  In other words, don’t rely on the fact that you are buying a franchise and not do the work.  

If you have been in this situation, with a failed business, what advice would you give to others?

Tags: baby boomers, franchises, pizza, PizzaWorld, small businesses

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Filed under: Estates

I’d usually save a piece like this for the Sunday Real Estate Round-Up but I’m a bit fascinated by New York real estate greed this week. The New York Observer’s Manhattan Transfers column reports that Kurt A. Locher, formerly a Lehman Brothers managing director and the head of its mortgage banking, isn’t trading down in these tough times, he’s trading up to a more high-priced apartment. He recently purchased a $5.25 million apartment at 500 West End Avenue. The five-bedroom apartment includes a formal dining room, a maid’s room, a living room, a library, and a windowed, eat-in chef’s kitchen. It makes Mr. Locher’s old place on Park Avenue and listed with Prudential Douglas Elliman, is on the market for $2.495 million look small by comparison.

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I don’t know about you, but I’ve been on an emotional roller coaster since all the “credit crunch” stuff and the financial crisis.  I can’t sleep, and I can’t concentrate at work.  I made the mistake of looking at my portfolio last weekend - bad idea.  And the roller coaster continues.  What a ride! Here is what I have been feeling:

• I am terrified that my husband and I will lose all the savings we worked so hard to build up over the years.
• I am mad as hell at all the companies that decided they didn’t want to deal with defined benefit pension plans and who dumped all the pension decisions in the hands of the public, few of whom are able to figure out what to do with them.  I’m pretty sophisticated about this stuff and I know the essentials, but what about all the people who are relying on their investment “advisor” at Merrill-Lynch to get them through this?  Yuck!
• I am disgusted with the people like the execs at Lehman Brothers who whine because they won’t get big bonuses.  I feel about them like I felt about Ken Lay of Enron infamy, that they deserve what they get.
• I feel sorry for the people who worked hard at these companies and who were caught unaware that they “house of cards” was going to come crashing down.
• I am worried that the economy will go down the tubes, just as I begin my retirement next month.  What a time to quit your full-time job!
• What I’m most upset about is the stupidity and greed of all the people who let this happen.  And I’m including myself in this.  I have been studying and teaching economics for years - I should have seen it coming.

What about you, baby boomers?  What worries you? What are you mad about? What do you wish you had done?  What will you do now?

Tags: baby boomers, credit crunch, financial disaster, market crash

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Filed under: Estates

Today’s home introduced me to the small lakeside community of Long Beach, Indiana. The town is a popular vacation spot for those looking for a swift getaway from Chicago, which is an hour away. Today’s home is one of the most lavish in the area. It sits right on the water with lake and Chicago skyline views and has 280 ft. of private beach. The four-bedroom home was built back in 1927 with a Mediterranean style that seems more suited for a warm weather location. The home has a great outdoor terrace, wine room, a gym that looks to be tucked into a porch-like space and has had its classic style updated with granite countertops in kitchens and baths and those glass box showers that are currently so popular. The home has retained its beautiful beamed ceilings and original fireplaces. It is listed at $6.24 million.

Experience more lush living in luxury homes and mansions or see the stars living massive with celebrity homes galleries at AOL Real Estate.

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Continue reading Long Beach, Indiana, Estate of the Day

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