12.3 C
New York

How Jimmy Goldstein, the NBA’s superfan, made his money

Published:

James Goldstein has courtside seats and a Hall of Fame wing along with his name on it. But his senior-citizen tenants say his business tactics are nothing to have a good time.

May 26, 2022 at 10:30 a.m. EDT

James Goldstein, in Houston, during the 2018 NBA Playoffs.James Goldstein, in Houston, throughout the 2018 NBA Playoffs. (Ronald Martinez/Getty Images)

LOS ANGELES — On a recent Thursday morning, James Goldstein sat down at his giant concrete slab of a desk, which offered a commanding view of the overcast city below, to knock out some business. He wore tennis gear and a red ball cap pulled over frizzy white hair.

His assistant, Roberta, had made neat stacks of emails, itineraries and invoices, printed in large font gentle on his 82-year-old eyes. The paperwork reflected the odd each day existence of a person who got famous by watching basketball — and wealthy in a way he doesn’t wish to speak about.

There have been NBA games to attend. Scouts for Yves Saint Laurent could be coming by his famed compound to plan future photoshoots. That evening, 900 partyers were set to descend on his in-home nightclub to advertise “the attention of the metaverse,” as Roberta described it.

After which there have been his applications to hike the rent on the senior residents who live in his empire of mobile home parks.

Goldstein has turned a peculiar source of fame right into a rigorously crafted legacy. For a long time, including throughout this NBA season and the playoffs, he has been a ubiquitous presence in courtside seats in arenas from coast to coast. No person but Goldstein, who has season tickets to each the Los Angeles Lakers and Clippers, is thought to look at upward of 100 games per yr from one of the best seats in the home.

He has grow to be a part of the NBA spectacle, immediately recognizable in his unique version of high fashion — the lizard-skin hat, the bandanna tied around his neck, the garish leather jacket — and accompanied by one among a rotating forged of fashion models five a long time his junior. His devotion to the game has earned him praise from top players and executives alike, with former NBA commissioner David Stern once lauding him because the “largest investor in NBA tickets on the earth.”

Last summer, the Naismith Memorial Basketball Hall of Fame unveiled the James F. Goldstein SuperFan Gallery, displaying a few of his gaudiest jackets and other memorabilia. The honour got here after he made a donation of an undisclosed amount.

Goldstein also lives in, and drives, future museum pieces. His home near Beverly Hills, inbuilt 1963, was designed by famed architect John Lautner. Goldstein is continuously constructing around it, along with his next big planned addition being an in-home theater; throughout his estate, partitions and shelves are lined with framed photos of himself with various celebrities. In 2016, Goldstein, who has never married and has no children, bequeathed the house and its contents to the Los Angeles County Museum of Art, along along with his 1961 Rolls-Royce Silver Cloud.

The home and the basketball fandom represent his biggest traits, Goldstein said, after calling it a workday at 11 a.m. and strolling the grounds with a reporter. He’s proud he has taken what he calls his “passions”— for basketball, fashion and architecture — and manifested them in a way that may remain after he’s gone. “It represents my patience and willingness to take an interest all the way in which,” Goldstein said.

But that very same persistence shows up in his much quieter four-decade profession as a landlord, in ways in which appear at odds with the politics of essentially the most progressive league in major American sports. An owner of mobile home parks throughout California, most of them seniors-only, Goldstein has been unrelenting in his quest to defeat limits on the quantity of rent he can charge his tenants, based on court records and interviews with tenants and town officials with whom he has done battle.

Goldstein has filed dozens of legal claims against California municipalities, in search of damages totaling within the tons of of tens of millions of dollars, for blocking his plans to extend rents by as much as double or more. In justifying the rent hikes, which continued throughout the pandemic, he often claims economic hardship as a landlord. Once, records show, after pioneering a way that effectively stripped rent control from one among his parks, then defeating a city’s efforts to stop him, he sued town for having tried — as a warning to others.

Throughout all of it, Goldstein has dismissed the objections of tenants who protested that, in gilding his own retirement, he’s ruining theirs.

Bill Wynder, an attorney who has represented Palm Springs and Carson in those cities’ decades-long battles against Goldstein, said the rent control laws Goldstein has attacked are vital to his tenants’ delicate living situations. “He didn’t particularly care, for my part, concerning the impact that may have on his largely fixed-income population,” Wynder said.

When asked whether Goldstein was essentially the most problematic landlord faced by those cities during his tenure as their lawyer, Wynder responded: “Times one thousand.”

“He’s been a bully and a thorn in our side,” said Carson Mayor Lula Davis-Holmes. Of Goldstein being honored by the Basketball Hall of Fame and the Los Angeles County Museum of Art, the mayor said: “He’s buying his legacy. You’re robbing from the poor to pay the wealthy.”

Prior to now, Goldstein has brushed aside questions concerning his skilled life, as a substitute burnishing his image because the NBA’s mystery man while vaguely chalking up his wealth to “land investments in California.”

But when pressed on the difficulty this time, Goldstein said his properties, which he likes to call “manufactured housing communities,” are well-maintained, featuring amenities equivalent to swimming pools and billiards tables. He described his aggressive tactics as vital to remain afloat, given local policies suppressing rent increases.

“Despite the fact that I’m a liberal, I don’t consider that rent control is fair,” Goldstein said. “It’s easy for somebody not within the business to get a fast glance at my business and are available to the conclusion that I’m just one among those greedy landlords.”

In reality, Goldstein suggested, it was the tenants who fought back who were the greedy ones.

“These aren’t just needy individuals who can’t afford to pay more,” he said. “These are all people, no matter their wealth, which are allowed to get away with paying only 50 percent of market value.”

In 1993, William Smalley, a 53-year-old divorced trucker, moved into Carson’s Colony Cove Mobile Estates. He purchased his coach, or mobile home, from his former Army platoon leader for $43,000. Mobile home residents typically own their coaches but rent the land under them. Smalley’s initial monthly rent was $328, and Carson’s mobile home rent-control ordinance was in place to maintain it in check.

In 2006, Smalley retired after 32 years of hauling propane on an 18-wheeler. He cashed in his 401(k), paid off all of his debts (including that of his coach) and settled in for what looked like a stable retirement in a gated community of tons of of fellow seniors. “I used to be in dreamland,” Smalley said.

But that yr, Goldstein bought Colony Cove. He then applied to lift rents from a median of $413 to $1,032, sending Smalley and his neighbors scrambling. Most of them lived off their social security checks and felt they might not leave Colony Cove. That they had equity of their mobile homes, which despite their name are literally difficult or unattainable to maneuver.

By then, Goldstein already had been notorious for 20 years amongst mobile home park residents in Southern California. The son of a Wisconsin department store owner, Goldstein was educated in math, physics and business at Stanford and UCLA. He landed on mobile home park ownership, he said in a recent interview, “to spend as little time as possible working in order that I might have the free time to do the things that I actually enjoy.”

Amongst his first purchases, in 1986, was El Dorado Mobile Country Club in Palm Springs, a 377-coach park for which Goldstein paid $7.7 million. He immediately began applying for significant rent increases. The park’s tenants and town resisted, leading to a series of court fights a judge later described as having a tenor of “mutual distrust.”

Mobile home residents’ vulnerability to opportunistic landlords — having invested in property on land they don’t own — has led states and municipalities to enact laws to guard them, including separate rent control provisions.

And within the mid-Nineteen Eighties, some California mobile home residents, in search of to counteract rent hikes and park closures, began exploring the concept of banding together to purchase their very own parks and subdivide them. In response, legislators enacted laws facilitating the conversion of mobile home parks to condo-style subdivisions.

Those laws were intended as a profit to mobile home residents, but Goldstein saw a possibility to use to subdivide his own property and, in doing so, defeat rent control. If one tenant purchased their plot from Goldstein after such a conversion, all the park would by law then be exempt from local rent control. Goldstein could be free to charge most of them whatever he wanted.

In 1993, he applied to convert El Dorado right into a subdivision. When Palm Springs intervened, he sued. His lawyers claimed it might profit the residents to own their plots, however the residents opposed it — and town argued Goldstein was simply attempting to “secure a lifetime exemption from rent control.”

A judge later noted that “this appears to be the primary case wherein the park owner has attempted to convert a park to resident ownership despite the opposition of the park residents.”

A judge dismissed his claim, but Goldstein appealed. In 2002, an appellate court ruled that while they were “concerned” that the law was getting used to “evade local rent control” due to a legislative oversight, there was no legal basis for town to impose conditions on potential “sham” conversions.

Palm Springs’ attorneys relented, citing mounting legal costs. “Town just said, , we now have fought the nice fight as long we could fight it,” said Wynder, who was city attorney on the time. He said town’s focus turned to minimizing the damage the conversion could do. As a part of that agreement, town agreed to subsidize Goldstein’s plan by making loans to residents to buy their lots.

But after striking that deal, Goldstein sued Palm Springs again, this time for $6 million, claiming town’s lost fight had cost him income. Goldstein’s attorney said on the time that the lawsuit was intended to “send a message to Palm Springs and other cities that it could be very expensive to follow political whims and never the law.” Town settled that suit for slightly below $1 million.

Goldstein then waged successful court battles to achieve similar approval to subdivide other of his mobile home parks. He didn’t undergo with those conversions, saying he got approval to maintain his “options open.” And inside a yr and a half of his coup in Palm Springs, at the least a dozen mobile home park owners across the state followed his lead, including by suing municipalities to undergo their applications to convert their parks, based on a state senate-produced report. That trend continued until 2013, when then-Gov. Jerry Brown signed a law limiting a landlord’s ability to subdivide their parks over the objections of residents.

But Wynder said Goldstein appeared unconcerned concerning the impact the tactics he pioneered were having on seniors concerned they might lose their homes. The attorney recalled a rent control meeting wherein one among his tenants waved a bag of pills from the dais and said, “That is what Jim Goldstein is doing to my life.”

Goldstein wasn’t there to see it, Wynder said. He was at a basketball game.

When asked about this episode, Goldstein scoffed on the suggestion that he was victimizing his tenants. He said he was the one being taken advantage of, in that rent control had made his tenants’ coaches more invaluable by suppressing the rent.

“Do you realize that these people have homes, that in the event that they were in a dealer’s lot, they’d be value $10,000?” Goldstein said. “But because those rents are 50 percent market, those people’s homes sell for $200,000.”

Carson, a blue-collar city in southeast Los Angeles County dotted by abandoned wells from a bygone oil rush, is home to roughly two dozen mobile home parks, constituting a large portion of its population of under 100,000. Town has long had on its books its own laws protecting mobile-home residents from steep rent increases, empowering a city board to make sure increases are “fair, just and reasonable.”

For 20 years before he bought Colony Cove, Goldstein owned the park across the road, Carson Harbor Village. And he repeatedly sued town for blocking or reducing his rent increases there.

His lawyers argued that town’s ordinance — or as they called it, its “Rent Control Scheme” — violated the U.S. Structure in that it transferred property value from him, the owner, to “politically powerful mobile home park residents.” Goldstein at one point even joined the rent control board he sought to destroy, but he said he was removed by city officials because he “knew the rent control ordinance too well.”

Despite this decades-long battle with Carson’s rent control ordinance, he still agreed to pay $23 million for Colony Cove, the seniors-only park, in 2006. For all of his complaints concerning the effects of rent control on his profits, Goldstein acknowledged in a recent interview that investing in properties under rent control made for sound strategy, leading to “less risk” because full occupancy is essentially guaranteed.

“Actually, buying a property where the rents are 50 percent of market could be enticing to anybody,” Goldstein said.

All but $5 million of his purchase of Colony Cove was financed, and Goldstein felt it was his right to factor his interest payments right into a rent increase. If not, he said, he would lose upward of $1 million per yr — thus his proposed $600-plus hike on Smalley and the others.

Carson attorney Sunny Soltani said Goldstein, fresh off his victories in Palm Springs, had agreed to pay a premium for the park because he expected to defeat rent control in Carson as well by claiming he wasn’t making a profit. But town said his interest payments didn’t justify a rent increase and that his proposal would have “dwarfed any rent increase awarded within the history” of its rent control ordinance. As a substitute, the board granted him a rise of $36.74.

Goldstein sued, as he would in fighting for rent increases in each of the primary five years he owned Colony Cove — even when he acknowledged a profit. In 2012, Goldstein said he made $180,000 on the park but argued that was “far lower than any reasonable investor would have expected.”

Goldstein’s decades-long fight with Carson culminated in a 2016 federal trial after he sued town for years of suppressed rent hikes at Colony Cove. Arguing that officials were forcing him “to shoulder a reasonable housing burden that must be borne by the City taxpayers as an entire,” Goldstein’s lawsuit claimed rent control on his mobile home park amounted to an “unconstitutional taking” of tens of millions of dollars in lost profits.

Carson provided a bus that brought the seniors of Colony Cove to U.S. District Court in downtown Los Angeles to look at the proceedings. Goldstein testified for parts of two days. His attorney argued that “constitutional rights involve issues which are very essential to only a couple of people — one person’s life, one person’s liberty or one man’s property within the City of Carson.”

The jurors agreed. They returned a verdict in his favor, and Carson was ordered to pay Goldstein $7.5 million. But then town appealed, and a better court reversed the judgment, finding the denials of his rent increases “couldn’t be characterised as a physical invasion by the federal government.” Goldstein appealed to the Supreme Court, however the justices declined to review the case.

Goldstein remains to be bitter concerning the loss. He argued that Carson had directly targeted him with a rent control guideline, published after he purchased Colony Cove, which stated landlords couldn’t bill their tenants for their very own mortgage interest.

“It will be like being in a basketball game and having the principles modified in the course of the sport,” Goldstein said.

Goldstein couldn’t make it to the disclosing of the Hall of Fame gallery in his name last June. He was recovering from having badly stubbed his toe on a rock while walking on the beach within the Seychelles.

The SuperFan Gallery is situated prominently above the hardwood court that’s the centerpiece of the museum in Springfield, Mass. It features an oversize photo of Goldstein shaking hands with superstar point guard Chris Paul. Along with Goldstein’s jackets and a hat and a digital display about him, the gallery includes memorabilia belonging to some of other superfans, equivalent to Toronto Raptors supporter Nav Bhatia.

In response to Scott Zuffelato, the Hall’s vp of philanthropy, the gallery was a part of an effort to lift roughly $25 million for an expansion. Zuffelato and Goldstein wouldn’t say how much of that goal was provided by Goldstein.

When asked whether the Hall had concerns about Goldstein’s tactics as a landlord, Zuffelato said: “We actually have focused on his basketball and the fandom he’s created across the game and what he’s done for the sport. That’s where I’d leave it, because that’s what our world is.”

Goldstein also said he’s unbothered by the complaints of the senior residents whose rising rents are partly to thank for his globe-trotting lifestyle and the honors he has received. “I don’t care about their negative opinions about me,” Goldstein said of the tenants, “but I do care about imposing hardships on them — which I haven’t done.”

It’s unclear whether Goldstein’s aggressive methods have done much for his portfolio. Sandy Marsh, one among Goldstein’s closest friends who has worked with him in real estate, said Goldstein’s fortune from mobile home parks has been built by him doing nothing. “Frankly, anybody who bought real estate, especially investment properties, 40 years ago goes to be looking quite good,” Marsh said.

By Goldstein’s own account, El Dorado hasn’t been the masterstroke he expected upon stripping it of rent control. The Palm Springs park is riddled with vacancies after residents pried their homes out of the bottom or abandoned them.

In Carson, residents say they still feel vulnerable to Goldstein’s whims, equivalent to his decision to remove the guards from the safety gate at Colony Cove, which they are saying has led to burglaries and muggings. (Goldstein said that he had only recently been made aware of the residents’ complaints about rising crime, and that he “intend[s] to follow up and pursue the chance” of reinstating the guards.) And annually, the park’s seniors get a letter from Goldstein’s attorneys informing them that he’s reserving his right to subdivide the property — and potentially throw their living situation into limbo.

“Each time this letter comes out, I get 50 phone calls” from concerned residents, said Smalley, now a spokesperson for the Colony Cove homeowners’ association.

But Smalley said for essentially the most part, following Carson’s victories over Goldstein in court, his neighbors are on to fearing the following landlord. “We’ve had a possibility to take heed to his story within the courtroom and watch him lose and lose and lose,” Smalley said. “So nearly all of the people here say: ‘I don’t give a rattling about Goldstein. What I do give a rattling about is, when he dies, who’s going to purchase us?’ ”

Still, Goldstein has continued to steadily seek rent increases, including throughout the pandemic. He’s applied for eight rent hikes in Carson since March 2020, based on city attorney Soltani. Goldstein defended those applications as vital because of the “long, expensive process” to extend rents in that city.

“I might say it’s not a superb thing to do for those who’re going to be a superb corporate citizen,” Wynder, the attorney, said of raising rents on seniors who already spent much of the pandemic isolated of their mobile homes. “But in case your goal is to maximise profits so you can afford front-row seats to Lakers and Clippers games, then you definitely do what you might have to do, I assume.”

sportinbits@gmail.com
sportinbits@gmail.comhttps://sportinbits.com
Get the latest Sports Updates (Soccer, NBA, NFL, Hockey, Racing, etc.) and Breaking News From the United States, United Kingdom, and all around the world.

Related articles

spot_img

Recent articles

spot_img