The Promote Podcast – Episode Summary

Episode: Fathers, Sons & Fast Fashion Tax Shields
Date: October 15, 2025
Hosts: Hiten Samtani (Founder, ten31 Media) & Will Krasne (Institutional CRE Insider)

Episode Overview

This episode of The Promote Podcast dives into three compelling stories from the world of Commercial Real Estate (CRE):

1. New York Office-to-Residential Conversions: Scrutinizing the financial viability behind the recent wave of high-profile office-to-resi deals.
2. Fast Fashion Tycoons in Real Estate: How global retail giants like Zara’s Amancio Ortega wield immense market power (and possibly use CRE as a global tax shield).
3. The David Bren Scandal: Exploring the downfall of a real estate scion and the intricate dynamics of legacy, family, and risk in CRE.

Throughout, hosts Hiten and Will blend market analysis with insider anecdotes, keeping a sharp, conversational tone—mixing industry detail with irreverent wit for CRE professionals and serious enthusiasts.

Key Discussion Points & Insights

1. Office-to-Residential Conversions: Distress Behind the Hype

[02:09 – 13:29]

• Rise (and Trouble) of Conversion Deals:

  • Nathan Berman of Metroloft Management, famed for 1990s/2000s NYC conversions (esp. 421G), resurfaces as the go-to fixer for distressed office buildings.
  • Billions in private credit are fueling massive loans ($720M for former Pfizer digs, $250M to Metroloft for 20 Broad, etc.).
  • Multiple high-profile players (Rudens, Silversteins, Van Barton, Jeff Giral) are circling these assets and pouring huge capital in.

• Challenging Economics:

  • While conversions are headline-grabbing, significant recent distress—e.g., 20 Broad's equity entirely wiped, mezz lender taking over.
  • "Did that get given back to the lender? Is everything cool, everything kosher?" – Will [02:51]
  • Creative capital stack structuring and tax maneuvering (e.g., asset contributions to avoid taxable events, stepped-up basis due to capex).
  • Cap stack complexity: large senior and mezzanine financings, recapitalizations, and intra-family JV structures.

• Product Issues:

  • Difficulties in optimizing floorplans due to legacy infrastructure ("You're locked in a little bit" – Hiten [06:36]) affect how lucrative converted apartments can be, compared to straight new builds.
  • Major players are banking on fees—construction management, property management—beyond investment return.

• Halo Effect & Its Limits:

  • Some "fixers" like Berman get a mythical status—"Mr. Fix It" or "The Alchemist"—leading to capital chasing them, until reality hits.
  • “...these things have solved nothing. None of these things have solved investing. At the end of the day, you've got to find a really good risk adjusted yield...” – Will [13:29]

Notable Quote:

"Berman was a little bit flippant about this. He just said it was over leveraged, that's all." – Hiten [07:54]

2. The Ortega Effect: Fast Fashion, Tax Shields, & CRE Pricing

[13:54 – 20:27]

• Ortega’s CRE Power Moves:

  • Zara founder Amancio Ortega and family office have bought trophy real estate globally—Miami Beach ($370M), Pennsylvania’s largest Starbucks roasting facility (Manchester), Brickell offices, and more.
  • Their ability to transact all-cash provides sellers with unmatched certainty and warps local pricing; they “reset” markets.
  • "When you have a group like ... men with deep pockets come in, they can basically warp pricing in a market very, very quickly. They'll break records." – Hiten [14:22]

• Motivations Beyond ROI:

  • Many trophy-type purchases are likely driven by non-investment motives, including shifting wealth offshore or away from the Spanish tax man.
  • “This actually might just be, like, a way to get money out of Spain and away from the tax man.” – Will [15:41]
  • Anecdotes about Spain’s relentless tax climate; CRE as a "safe" store of value.

• Vibe-Setting and Market Psychology:

  • Record deals (e.g., Michael Dell’s $100.4M penthouse; Dmitry Rybolovlev’s $88M CPW pad) become comp benchmarks. The narrative built post-factum influences investment committees and justifies higher pricing across well beyond the super-prime tier.
  • “In real estate, like, are the vibes good? One guy like this can reset the vibes across the entire top end of the market.” – Hiten [17:30]

• Comparison with Other "Deep Pocket" Players:

  • Other global families (IKEA’s Ingvar, Namdar, Idan Ofer) play similar roles, but some deals are opportunistic while others are asset-parking/tax-based strategies.

• Tax Law’s Outsize Impact:

  • With U.S. tax reform (100% bonus depreciation) back in play, the after-tax math vastly favors real estate—CRE becomes not just a market, but a mechanism for wealth protection.

Notable Quotes:

“If you make an average real estate investment and the average investment in the stock market, you can be 300, 400 basis points worse in real estate and still come out ahead post tax.” – Will [19:47]
"Having a guy like this splash the pot however the fuck he likes really makes a difference." – Will [17:45]

3. Fathers, Sons, and the David Bren Scandal

[21:41 – 29:16]

• Donald Bren – The Ultimate Landlord:

  • Controls half (possibly up to 75%) of all multifamily in Irvine, CA; among the wealthiest and most powerful property owners in the U.S.
  • “I cannot think of a property owner with more juice in one single city than Donald Bren has in Irvine.” – Hiten [21:44]
  • Micromanagement legend—insisting on exact fonts, landscaping plant species/positioning.

• David Bren’s Bunker Fiasco:

  • David, Donald’s estranged son, attempted to create an ultra-luxury auto club ("the Bunker") at LA’s Mr. C’s hotel.
  • Used the family name to court investors, but defaulted, leaving over $2.5M in losses and at least one related suicide.
  • Built a smokey, potentially fraudulent “illusion” of access to his father and major celebrity backers.

Contrast Between Legacy and Hustle:

• The story highlights how reputation, track record, and familial connections function as “comforting” proxies for actual CRE credentials.

The Devastating Estrangement:

• Donald Bren’s only public statement regarding his son:

  “We do not have a personal or business relationship with this individual.” – Donald Bren, relayed by Will [27:49]

• “The 'we' is the darkest. Like, not even I.” – Will [28:01]

Themes of Image, Trust, and Inheritance:

• In CRE, successful image-building can substitute for substance—until it doesn’t.
• “Real estate really is about presenting an image... saying you can do something based on something in your past that allows you to do the thing. …In his past, I guess he was just born into the family.” – Hiten [28:47]
• The segment ends on a somber note about fathers, sons, and the limits of legacy.

Memorable Quotes

• "Do the numbers work? There's been enough distress from some of the OGs that it warrants that question." – Hiten [00:48]
• "Baseball is fathers and sons, but baseball's got nothing on real estate." – Will, quoting Donald Hall [00:21]
• "You end up with a son who allegedly does shit like this. So it's a pretty unfortunate situation...I would have picked Dubai. Honestly, Dubai is a better spot for someone like this." – Hiten [28:24]

Timestamps for Important Segments

• Exploring Office-to-Residential Conversions: 02:09 – 13:29
• Fast Fashion, Ortega, and Global CRE: 13:54 – 20:27
• The Donald & David Bren Saga: 21:41 – 29:16

Episode Flow & Industry Relevance

This episode punctures the hype behind office-to-resi conversions, connects global CRE pricing to the financial maneuvers of billionaires, and humanizes CRE risk through a dramatic story of legacy gone awry. Hiten and Will maintain a no-nonsense, insider tone while allowing for humor and pathos—illustrating that in real estate, numbers, psychology, and relationships are always intertwined.

For deeper breakdowns and exclusive stories, check out Promote Insider at thepromote.com.