02 August 2006 – CITY A.M
David and Simon Reuben are vying for a spot amongst Britain’s entrepreneurial elite, somewhere between the Barclays brothers and Sir Philip Green. The billionaire brothers are constantly linked to high-profile property deals, most recently after they offered $50.9m for 4.8m shares in retirement home builder McCarthy & Stone this week.
They own about 100 properties in London – including 2m sq ft of office space close to the Houses of Parliament in the heart of Westminster – and are involved in one of London’s largest redevelopment projects for the 2012 Olympics. Yet within in the Square Mile little is known about the pair, both in their mid-60s and estimated to be worth more than £2.1bn. Few people have met them and they rarely give interviews.
MYSTERIOUS AND ELUSIVE
Despite a concerted effort a few years ago to woo the British business establishment – they held a cocktail reception in one of their villas in Cannes in 2003 – the Indian-born brothers remain shrouded in secrecy. Their website gives little away, claiming the well known figures in the property market are “proud” that their main focus is on British business. The extent of their fortune, how many deals they have been involved in over the years and just how big their empire is, is also unclear.
Spokesman Charles Stewart Smith of PR firm Luther Pendragon said the chance of speaking with the pair was “extremely unlikely”, saying: “They just do not tend to grant media interviews.” One thing is known: they have ruffled some feathers in the City. And at the top of the antagonists list is Ken Livingstone.
The outspoken mayor cast the brothers into the spotlight in March. Livingstone said the pair, involved in a consortium behind London’s planned Olympic City, would land the state with a £700m fee for missing the project’s deadline because they did not have a track record of “successfully undertaking major developments, or of working in partnership, without collapsing into squabbling and litigation”.
During a press conference Livingstone then added: “If they’re not happy they can always go back to Iran and see if they can do better under the Ayatollahs”.
AN IMPRESSIVE PORTFOLIO
Even after the scathing attack, the brothers refused to go public. Their spokesman meekly said the pair were “working ceaselessly to try to move the project forward”. Despite their tiffs, the Reuben brothers have a very powerful position in the British property market. They are likely to win their bid to take over McCarthy & Stone.
If it completes, the deal will bolster their growing property empire. Both British citizens, they own substantial parts of Victoria, including the John Lewis headquarters and the American Express offices. They also own Carlton House on St James’s Square, Academy House on Sackville Street, Connaught House on Berkeley Square, Market Towers and prime Sloane Street shops.
In Europe their property portfolio includes the prestigious Lloyd’s Bank headquarters in Monaco and a string of retail ventures in Germany, France and Romania. They have also snapped up 6m sq ft in Gibraltar, with apartments, a hotel, a large marina and shopping centre, and own eight data centres throughout the world.
RISING TO STARDOM
The brothers’ list of business contacts is as impressive as their basket of property assets. They have partnered up with big guns like HBOS – Britain’s fourth biggest bank through its Bank of Scotland corporate finance division, as well as construction giant Multiplex and bar and club operator, Ultimate Leisure Group.
So who are the elusive pair and how did they rise to such dizzying heights?
The brothers were born in Bombay to Iraqi Jews. David, the eldest brother, who lives in London, started out by joining a scrap metals business called Mount Star Metals. This took him to Russia, China and North Korea. He then joined Trans-Continental, a subsidiary of Mount Star, before heading up a joint venture 50 per cent owned by Merrill Lynch.
Simon started by importing carpets to Britain and bought J Holdsworth, England’s oldest carpet company from receivers. He managed to turn the company around from the brink of bankruptcy and used the profits to buy property. He formed a property group called Devereux, which he sold in 1972 for a substantial sum.
The brothers began working as a partnership in the 1990s and made their money in Russia through their company Trans World. They sold the business in 2000 for more than £500m when the Russian mafia became more powerful and as their former business partner Lev Chernoy was being investigated. Trans World was at the time accused of money laundering – a claim it vehemently denied. They then set their sights on joining the big players in the British property market – and did it. While they’re not willing to open their books or face the media, it is no secret the Reuben brothers are a powerful force.