FORBES LIFE 10/08/2013 @ 10:00AM
The Bet That Changed Billionaire Ted Lerner's Life
This story appears in the October 28, 2013 issue of Forbes Life.
By Ted Lerner
I decided then to go to school on the GI Bill. I did 42 straight months, getting my undergraduate and law degrees at George Washington University. I thought I should become a lawyer, that it would be a good background. While in school, I sold real estate on the weekends to support my mother, who was now a widow, and my younger sister and brother.
One day while in school my sister suggested that I call a beautiful young woman named Annette Morris. My sister thought I would like her. For one reason or another, I did not make that call. But soon after I saw Annette at a fraternity dance. She had a serious date, but I cut in and danced with her. Two weeks later I asked her to marry me. She said she’d think about it. We got married in 1951, a year after I graduated from law school. It was the best decision I’ve ever made.
After I graduated from law school, I briefly practiced law. In my very first case, the court appointed me to represent a parking attendant charged with stealing the cars he was parking. I somehow got his sentence reduced from two years to six months. My client promptly left town without paying me. I figured there had to be a more rewarding way to make a living, so I decided to get into real estate full-time. It was 1952. I was 25.
The only problem was that I didn’t have any money. Annette worked in the State Department as a secretary (she once was asked to take dictation from Eleanor Roosevelt), so I asked her for a loan. She loaned me $250. That’s how I got started.
To say the first year was tough is an understatement. I grossed $1,050. But things got rolling the second year. I met a home builder who had 400 empty, finished houses that he just could not sell. He was having all kinds of troubles. Some of his houses were in such rough shape that there was grass growing inside them. I offered to sell his houses. He gave me 25 to move. They were going for $14,990 apiece.
Since it was early November, I wrapped an entire model home in Christmas
decorations. I took out an ad in the paper, with his money. I put Santa Clauses
on each of the ten corners in the development. I pulled out all the stops.
The ad ran on Friday. I called the man on Saturday at noon. “All 25 are gone,” I said. He asked me to sell the rest. Ten days later I’d done just that. Word got around, and I started to get a lot of new business. I was putting in 18-hour days.
After selling 22,000 houses, I thought it was time to start developing real estate myself. In 1958 I was offered the opportunity to develop my first shopping center, Wheaton Plaza, which opened in 1960, one of the first open malls in the Washington, D.C., area. Then I bought two large pieces of ground in a place called Tysons Corner. I took my wife out there to show her the ground. There was nothing there, just cows and a tractor and a log cabin. She said: “You know, you’ve done rather well up till now. But you’re going to blow it with Tysons Corner.” She was skeptical, to say the least–but she had confidence in me. The area now is a flourishing business center, with malls and office buildings, and even a Metro stop opening this year.
I kept building–houses, apartments, retail centers, office buildings and hotels. From the earliest days of our marriage, Annette and I wanted to build something that we could pass on to our children. One of my proudest accomplishments is that all of our children are involved in the business. In fact, when our family bought the Washington Nationals in 2006, MLB Commissioner Bud Selig said one of the reasons we got the team is that he could tell from the unity of our family that we could handle a succession plan well.
Of course, the true measure of success is not what you can achieve for yourself but what you are able to do for others. Annette and I have started a foundation and have given enthusiastically to programs and organizations that are helping others live better lives.
But what about that $250 I borrowed from my wife? She believes that what we’ve done together as partners is a fantastic return on a shared investment and a blessed life.