At Long Last, Antares

Greenwich Time has finally published the Neil Vigdor article on Antares, our latest example of what happens to foolish people and their money in Greenwich. I’m linking to the Connecticut Post, which posts GT stories earlier than our local rag itself, I don’t know why and, though there’s no mention of more to come, surely there must be. This is just a snippet of the Boys’ pratfalls, hubris and greed and the best is, I hope, still to come. If you’ve passed by the empty, “fully leased at record rents” UST building lately, you’ll get the drift.

They built backcountry spec houses the size of big-box stores, sat behind home plate at Yankee Stadium, and partied like rock stars with black metal American Express cards.

But Antares Investment Partners had a darker side. The same alpha male executives who loved the trappings of superwealth also risked hundreds of millions in investors’ money on overleveraged, underperforming deals and tapped financiers who lined up to provide cash, never looking closely enough to see the cracks in the high-flying company’s facade.

“I said to myself, ‘This is going to end badly,'” said Matthew Allen, 37, an asset manager who worked for Antares from September 2006 until he was laid off in October 2007.

UPDATE: 10:15 AM: The story is now on the Greenwich Time website. It is, as readers said, intended to be a three-part series, so that should be fun. And this link has pictures and even a video of GT reporter Neil Vigdor having a “frank and fruitful discussion” (hey Walt, how’s that for the name of Fudrucker’s Disocount Real Estate?) with someone at “Lake Carrington”.

UPDATE II: from Brother Anthony:

The article states, “There was no real rhyme or reason to the choice of [of the name ‘Antares’]” but it was a prescient choice regardless. Antares, a bright star in the constellation Scorpio, is a red giant; vastly larger than our sun but with far lower density. Because of insufficient mass, red giants eventually implode and become white dwarfs. If there is a better metaphor for those Antares kidz I don’t know it.
Anthony Fountain

16 Comments

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16 responses to “At Long Last, Antares

  1. Anonymous

    Much better picture. Happy go lucky group of girls. I didn’t know that you have five daughters? You look so young. Or are they college colleagues of Sarah?
    Please, NO HOOPS.

  2. Stanwich

    Nothing new here, just a good recap. I still can’t believe people would fork over money to these clowns.

  3. At Long Last

    “In the eye of the storm were James Cabrera and Joseph Beninati, the firm’s founding partners, whose mercurial rise to success, insatiable appetite for real estate, oft-described “cowboy” attitude and penchant for the good life rubbed many they encountered the wrong way.”

    Their “cowboy” attitude and penchant for the good life certainly seem to have rubbed Chris Fountain the wrong way judging by how he has been publicly licking his chops over this article for several weeks now…

    Greenwich Time says this is just the first of three chapters, so maybe the best is yet to come.

    Bon appetit, CF!

  4. Anonymous

    “The firm is equally pleased with its 50 percent ownership stake in the Delamar Hotel, also in Greenwich, where showy yachts are commonly moored at the private dock and the average room goes for more than $300 a night”
    http://www.nytimes.com/2006/10/15/realestate/15wczo.html

    “It’s been uncomfortable,” Mallory, the hotel’s majority owner, said of being linked to Antares. “It’s been frustrating to have to have to continually explain the modest nature of Antares financial involvement in the hotel.”
    http://www.connpost.com/ci_13184709#top

    I’Bker, Your math is good, when does 50% equal 5%?

  5. Greenwich Gal

    Maybe it was 50% in 2006 when that NYT article was written and is now 5% in 2009 when the GT article was written. FYI – one should always pay attention to dated information…

  6. 2112

    Very disappointing puff piece. Cowboys? Greed? How bout a wire diagram showing their holdings, partners and financiers/creditors? That would be interesting.

  7. Anthony Fountain

    The article states, “There was no real rhyme or reason to the choice of [of the name ‘Antares’]” but it was a prescient choice regardless. Antares, a bright star in the constellation Scorpio, is a red giant; vastly larger than our sun but with far lower density. Because of insufficient mass, red giants eventually implode and become white dwarfs.

    If there is a better metaphor for those Antares kidz I don’t know it.

  8. Anonymous

    So hurray for neil vigdor… who only now writes about the antares disaster. with phrases like ”cracks… in the facade’, ‘blueprint was flawed’ and ‘a shooting star’, vigdor implies that the structure was doomed from the beginning. probably was… but where was vigdor and his brilliant observations when antares was attracting tens of millions of dollars from investors? we’re all smart now, aren’t we? but none of us were meredith whitneys or john paulsons two years ago. it’s so easy to pick the winners and losers when the race is over.

    • christopherfountain

      I can’t speak for Mr. Vigdor, whom I don’t know but I was writing about these boys years ago, when they were outbidding other developers by 2X on land deals. Since all these guys use the same math, the only way Antares could be bidding so much was if they intended to make a profit via some avenue outside of the development itself- Mgt fees, for one. No one seeing what Antares paid for Putnam Green, for instance, ever thought they’d make a dime from actually selling the units as condominiums, just as no one believed them when they claimed thay’d sell for $1.9 million each. But Lehman got banking fees, Antares grabbed fees and advances and the actual debt was sold off to suckers like the New Mexico State Pension Fund. So all of this was predictable and in fact was predicted. the only surprise was that the Kidz lasted as long as they did.

  9. Anonymous

    Greenwich Gal,
    Do you really believe that in 2006, in their ‘hey day’, they owned 50 percent of what has been a successful hotel and now, only three years later, they only own a five percent share? Why would they sell? Did they sell to the major shareholder? Was he the highest bidder?
    Surely they never owned more than 5 percent at any time.
    Maybe, just maybe, they were all talk!

  10. Joe Cabrera

    Cabrera is full of hot air like his failed brother. Now crash landing soon.

  11. Former Antares

    The 50% stake was only in the management entity of the Delamar, never in the ownership. Antares controlled about 6% of the equity which they promptly sold about half of to investors. At a steep markup of course for their great ability to identify value – Ha!

  12. Cos Cobber

    A few thoughts for Anon at 11:42.

    a) From what I have heard, Antares’ ownership interest in various restuarants has shifted up and down over their short run. Not sure why. I could speculate on a bunch of scenarios, all tedious, so I wont. That said, I don’t completely dismiss the notion that they lied (or mislead others) as to their ownership percentage back in prior years as well.

    b) Regarding Neil Vigdor’s perfect hindsight, there where plenty of people in real estate whose mouths were agape as to Antares every action on their run up. In particular plenty of area people were rather confident that Putnam Green and Weaver’s Hill were destine for failure. The numbers didn’t added up and never would even in the rosiest economic scenarios. It wasn’t even close. Combine their well know caliver attitude, with unbelievable portfolio/project growth and, this is key, the fact that they have never completed a meaningful and successful development, were all additional caution flags flying high. Thoughtful people involved with local real estate knew better from the beginning. Just ask them.

    c) This was a local real estate flame out. When you are dealing with local matters, the local news media hardly has the time, the staff or the gumption to write articles predicting failure of local businesses. Frankly, I dont think the locals would like it even if they could. People would view it as nasty way to conduct business. People want to believe local business will be successful and don’t like to see others, particularly those with a bull horn, tearing it down before the results are in.

    I agree with others, the article is a nice recap, but with nothing new to offer.

  13. pulled up in OG

    Put my reading glasses on but Frankie’s still fuzzy!!

  14. HG

    CF…one area where you might add info Greenwich Time left out is if you happen to have thoughts on how much it cost Antares to develop the “Lake Carrington Estate” (is that from Dynasty?)…you have probably already written about the land cost but I did not go back and search…but I would be interested in what you think the cost was, since the original $28 million ask, the current $14.5 million ask and the involvement (or not) of A-Rod seem less important in determining true value. Obviously the other factor is how this compares to the couple of other large recent sales.