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post #1 of 4 (permalink) Old 02-03-2006, 12:37 AM Thread Starter
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Ira Rennert's House in Jeopardy

"America's Top Toxic Polluter", the junk-bond maven who built the "House that Ate the Hamptons" might just have looted one pension too many...

February 3, 2006
Pension Battle May Entangle Mogul's Home
By MARY WILLIAMS WALSH

Ira L. Rennert's colossal house in the Hamptons, built with the riches from his sprawling industrial empire, has withstood lawsuits from angry neighbors, appeals to the local zoning board, even an attempted documentary filming by Michael Moore.

But now a new challenge is looming. The federal agency that insures pensions appears poised to lay claim to Mr. Rennert's 29-bedroom oceanfront estate, along with other assets, to make sure he delivers on hundreds of millions of dollars in pensions promised to a group of steelworkers in Ohio.

In most pension failures, the federal Pension Benefit Guaranty Corporation has little choice but to absorb the liabilities of the pension fund itself. That is because the sponsoring company has filed for bankruptcy and there is rarely enough wealth tucked away in related entities to be worth going after.

But Mr. Rennert's business empire, according to Carol Connor Flowe, a former general counsel for the pension agency, presents a rare opportunity: a bankruptcy with a deep pocket.

"It's especially a situation where they're going to be aggressive," she said of the agency, "because there looks to be quite a bit of value" in Mr. Rennert's holdings — including his $185 million house.

Mr. Rennert built up his wealth by buying a variety of distressed industrial companies, often with high-yield junk bonds that allowed him to avoid putting up much of his own money. Besides his house in the Hamptons, Mr. Rennert owns a Manhattan duplex on Park Avenue and a home in Israel.

...Mr. Rennert is not likely to lose his estate in Sagaponack, the biggest, most expensive home in the Hamptons. But it is a particularly tempting target because of its personal value to Mr. Rennert. To prevent the government from placing a lien on it, he could be forced to hand over as much as $189 million — somewhat more than the value of his property — to cover the government's cost of paying the pensions that he promised to the steelworkers.

A similar tactic worked with the financier Carl C. Icahn, who controlled Trans World Airlines when it filed for bankruptcy in 1992, recalled Ms. Flowe, now a partner at the law firm of Arent Fox in Washington...

The most successful of Mr. Rennert's acquisitions was probably A. M. General, which makes the Humvee armored troop carrier and its civilian counterpart, the original Hummer, which is sold through General Motors. Mr. Rennert bought the company out of bankruptcy in 1992 for $133 million, and sold 70 percent of it to the financier Ronald O. Perelman in 2004 for about $930 million. He still holds the remaining stake.

Remainder of article at
http://www.nytimes.com/2006/02/03/bu...03pension.html




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post #2 of 4 (permalink) Old 02-03-2006, 01:42 AM
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RE: Ira Rennert's House in Jeopardy

Articles from the New YorkerGood Neighbors Dept.download pdf

homeblinkthe tipping pointthe new yorker archiveetc.

January 25, 1999
talk of the town

Sagaponack Homeowners Association vs. Ira Rennert


Now that the strange case of the Sagaponack Homeowners Association vs. Ira Rennert appears to be concluded, it may be time to reflect on what has--and has not--been learned from this, the season's most engrossing episode of rich-on-rich violence. Rennert, as is now widely known, is the multimillionaire industrialist who is building a forty-two- thousand-square-foot single-family home, reported to cost a hundred million dollars, on a sixty-three-acre Hamptons potato field. The Sagaponack Homeowners Association is the opposing group of angry neighbors whose petition to withdraw Rennert's building permits was voted down earlier this month by the Town of Southampton's Zoning Appeals Board. The battle has been a long and heated one, about zoning laws and ocean views, and it has left those of us without homes in the Hamptons more than a little confused. Herewith, then, a brief guide for the uninitiated.

Let's start with the least technical, but perhaps the philosophically thorniest, question raised by the case. Why, in an area full of very big houses, is the prospect of a very, very big house so controversial? The answer is that "big" is a relative term. A standard new monster home in the Hamptons, for example, now runs between ten thousand and fourteen thousand square feet, which is to say that it probably has six or seven large bedrooms (each with its own bathroom), a great hall, a formal living room, an informal living room, a dining room, a media room, a library, a five-to-six-hundred-square-foot kitchen, maids' quarters, a pantry, and, say, a three-or four-car garage. "Some houses have a squash court, and I've built a few with bowling alleys," Kurt Andreassen, a local contractor, said.

When Southampton decided, this fall, to place a limit on the size of all new houses, it settled on twenty thousand square feet, on the ground that that figure represents a reasonable limit, given the big-house norms of the area. At twenty thousand square feet, a house has perhaps ten or eleven bedrooms, a dozen bathrooms, a six-car garage, and maybe, oh, a mini- trading floor for the kids. By comparison, Rennert's house, at forty-two thousand square feet, has twenty-nine bedrooms, thirty-three bathrooms, and two bowling alleys. What the Town of Southampton was saying, in other words, is that twelve bedrooms and one bowling alley is fine, but twenty-nine bedrooms and two bowling alleys is not. Think of the twenty-thousand figure as the community standard--a social consensus--for the maximum size a Hamptons monster home ought to be. With that extra bowling alley and those seventeen additional bedrooms, Rennert just went too far.

Which brings us to question two: If twenty thousand square feet represents the Hamptons monster-home limit, then why didn't the Town of Southampton pass this zoning restriction long ago, before Rennert started building his dream house? You might think that it was because the town had been lax about zoning. But that is not the case. For example, the Sagaponack potato field where Rennert is building his house is zoned R-120, which means that the minimum lot size in the area for anyone looking to build a new house is three acres. There is also on eastern Long Island virtually no land zoned specifically for multifamily rental apartments. If you wanted to build an apartment house in the town of Southampton for people who are not millionaires, you would have to go before the town board and ask for a special variance. In Sagaponack, according to Paul Houlihan, Southampton's chief building inspector, such a variance would be impossible to get.

Suppose, then, that Rennert was not a multimillionaire but only a millionaire and couldn't afford the standard Sagaponack three-acre plot--which runs somewhere between seven hundred and fifty thousand dollars and a million dollars. He wants one acre. And suppose that, to make things more affordable, he wants to put up a small town house with a couple of apartments that he could rent out. Under Southampton zoning rules, his application would be denied outright, even though that little town house wouldn't block anyone's view of the beach. But a forty-two-thousand-square-foot house on sixty-three acres? According to the original zoning laws of the town, perfectly legal. In other words, the citizens of Southampton have lots of rules in place to protect their community from people who have less money than they do. It just never occurred to them, until Rennert came their way, that they also need to protect their community from people who Have more money than they do.

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RE: Ira Rennert's House in Jeopardy

The current champion in the gross-house sweepstakes is the five-building, 110,000-square-foot complex industrialist Ira Rennert is building in Sagaponack on one of last unspoiled potato fields that roll down to the sea. In our house, the Rennert home is known as "the Bolivian prison." Actually I have never seen a Bolivian prison, but if I do, I expect it will look very much like Rennert's place, only smaller and more understated. The Rennert complex will have a 10,000-square-foot "playhouse," 25 bedrooms, 39 bathrooms and -- for some unexplained reason -- a 200-car garage. Maybe Rennert has plans for a 2,000-square-foot lobster salad vault, too. The Rennert potato-field palace is the standard by which future wretched excesses in the Hamptons will have to be measured.

John Leo


Consumer Reports


'Affluenza' hits the Hamptons

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RE: Ira Rennert's House in Jeopardy

Quote:
Gert - 2/3/2006 4:14 AM
25 bedrooms, 39 bathrooms and -- for some unexplained reason -- a 200-car garage.
Jeez... that's the only part that doesn't need explaining!

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