Chicago Tribune from Chicago, Illinois • 341

It LS Section 16 (fhicajjo (Tribune Sunday, April 8, 1934 The classified market place Donald Trump: Realty magnate with castles on the drawing board As- it 1 1 Tribune photo by JoM More Evans Spiliios, in the Bar AssociationNorth Western Law School building, now under construction on Lake Shore Drive. "We wear the owner's Richard Halpern center, president of Schal Associates, and his assistants, Michael Clune (left and the first tenants are moving into Trump's $123 million Trump Plaza luxury cooperative apartment building at Third Avenue and 61st Street. His Generals are off to a winning start in their first season under his ownership. He is hovering attentively over his newly opened Xanadu of conspicuous consumption, the $200 million Trump Tower condominium-office-retail complex on Fifth Avenue, supervising the planting of every flower. He is also supervising the final touches on Harrah's at Trump Plaza, a mammoth $220 million casino-hotel in Atlantic City set to open next month.

THUMP IS FAST becoming one of the nation's wealthiest entrepreneurs, able to buy practically anything he wants. He controls a company with assets estimated ome say conservatively estimated at $1 billion, and casino-industry analysts say his half interest in Harrah's may provide him with $40 million to $50 million more in annual income. He has told people in the communications industry that he is "very interested in communications," which is like a gorilla mentioning that he is very interested in becoming carnivorous. Until recently, he was purchasing large amounts of RCA stock, with an eye toward securing a controlling interest, but he gave up on that when the price of the stock more than doubled, lie sold the stock, profiting handsomely from the failed takeover. The heads of several Fortune 600 companies have already bought co-ops at Trump Plaza on Third Avenue, along with Gov.

John Y. Brown of Kentucky and his wife Phyllis George; Martina Navratilova and Dick Clark. While critics charge that Trump is a raving egomaniac, bent on putting his. name on every inanimate object in the city, he claims that putting on the Trump name is value added. "These units are selling," says Blanche Sprague, who is in charge of sales at Trump Plaza, "because of the Trump name.

1 don't think you understand," Mrs. Sprague adds. "When I walk down the street with Donald, people come up and just touch him, hoping that his good fortune will rub off." THE TRUMP touch. It has set some people in New York to outright Trump Continued on page IA Dy William E. Geist "DONALD! KEY.

Donald! Donald!" The men were yelling, eager to call him by name. A storm front of cigar smoke was gathering above the hotel ballroom, packed elbow-to-elbow for a breakfast hour sports forum with a crowd that included some of New York's most wealthy, powerful and famous men. Yet, somehow, everyone at this sports function was drawn to Donald Trump, the owner of the New Jersey Generals, a franchise in the upstart U.S. Football League. Donald J.

Trump is the man of the hour. Turn on the television or open a newspaper almost any day of the week and there he is, snatching some star from the National Football League, announcing some preposterously lavish project he wants to build. Public-relations firms call him. offering to handle his account for nothing, so that they might take credit for the torrential hoopla. He has no public-relations agent.

His competitors wonder how this can be, but watching him at the sports forum provided an explanation, while executives of the other teams told the audience about problems of negotiation and arbitration, about dirty restrooms inside their arenas and street crime outside and about "attempting to move the Meta In the right direction," Donald Trump was electrifying the room with rat-a-tat-tat revelations, dropping names of star NFL players and coaches he would sign in a matter hours. He said further (hat he would "continue to create chaos" for the NFL and, by 'the way, that he planned to build a domed stadium in New York. LATER THAT day. Trump keeps an appointment with Philip Johnson and John Burgee, eminent architects. Models are brought in of Trump's next proposed building, a 60-story castle, Trump Castle, six cylinders of varying heights with gold leafed, coned ana crenelated tops to be built at 60th Street and Madison Avenue.

There is to be a moat and a drawbridge. "My idea," says Johnson with a mischievous grin. "Very Trumpish." "Trump is mad and wonderful," says Johnson. The 77-year-old architect proclaimed the castle his "most exciting project" ever. with castles on the drawing boards, Firm rides herd on construction costs boss, and that shifts their relationship and nol ever so slightly.

Before he came to Schal, project director Spilios Evans was with a general contractor. "Here, we're working for, not against, the owner," he says by way of describing the difference between those two posts. Once a client and his contractor make a bottom-line agreement, Evans notes, it is in the latter's interest to discover that the building really-doesn't need a few bags of cement nere, a piece of structural steel or two there. His paycheck is fixod, so every penny saved is a penny earned and increases his profits accordingly. Of course, from the owner's stand- point, the reverse is true.

Penny-pinching during construction can turn a dream project into a chintzy reality. So a decade or so back, a few pioneer figured out how to rescue the building industry's patrons from that dilemma. Simply separate project management from construction contracting, they reasoned, and the Continued on page IC Founded in 1976, Schal Associates booked $9 million worth of construction its first year. By 1983, the value of its projects had reached $400 million, and today the firm has 250 employees helping Halpern and Schiff manage their clients' real estate development. In Chicago, those clients include the developers of One Park Place, Madison Plaza, One Magnificent Mile, the Northwestern Law Center and the Chicago Board of Options Exchange.

PARTIALLY. SCHAL'S increasing share of the pie derives from a growing realization that, as now organized, trie construction industry leaves its sugar daddies out on a curious financial limb. Traditionally, a guy who gets the itch to put his name on a skyscraper goes to an architect for a set of Elans. Then, he totes those over to a contrac-ir. who adds up the costs of the necessary concrete and I-beams, tacks on a surcharge for himself and lays that total price tag on the project.

If the owner-to-be buys it. the hand that just punched out those numbers on a calculator becomes the client's construction By Ron Grossman RICHARD HALPERN likes big buildings. Coming to work in the morning, he likes the look of their pattern on Chicago's skyline. Drifting off to sleep at night, he likes dreaming up new ways of building them. He's also a very lucky guy.

People pay him to tuck those dreams in his briefcase and carry them back to the office the next day. The strange thing is that he's neither a contractor, an architect nor a developer. Instead, Halpern is one of the first of a new addition to the building industry's long-established cast of characters. "We're construction managers," he says when asked to define the function of Schal Associates, of which he is president. "Our special expertise is the economics of the building process." In other words, Halpern says, "We wear the owner's hat." By that he means a hard hat, and in the last few years a lot of clients have asked Halpern and his partner, Harold Scruff, to don one for them.

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