We first heard of Fairfield Greenwich Group in 2007, way before the hedge fund’s ties to Bernie Madoff came to light. At the time, the firm showed up on our radar because influential dealmaker, Charles Murphy (not Richard, New York Times), had joined the firm after spending 15 years running the European FIG operations for Morgan Stanley, Deutsche Bank and Credit Suisse. He brokered such deals as Bank of Scotland’s takeover of NatWest. He was supposed to prepare FGG to go public, but Madoff got in the way.
And before Murphy even set foot in his FGG office, he’d dropped $33 million for Seagram’s heir Matthew Bronfman‘s Upper East Side townhouse—the most paid for a townhouse fewer than 26 feet wide, which we wrote about for Dealmaker magazine in November 2007.
Since the Madoff scandal unfolded, we’ve wondered what happened to Murphy and his townhouse. Now, The New York Times tells us that, sadly, Murphy is out of a job, and he’s put the house back up for sale. As we suspected, his move was inspired by the fact that the townhouse next door recently hit the market.
NY Times: Now Mr. Murphy is listed as a defendant, along with other Fairfield Greenwich partners, in lawsuits brought by distraught investors.
Since the house next door closed on Jan. 12, Mr. Murphy has called in four top brokers, including Mr. [Richard] Steinberg [of Warburg Realty] and Carrie Chiang of the Corcoran Group, to discuss the possible sale of his house.
According to brokers, Mr. Murphy was considering asking about $36 million for the house, which he upgraded after it was lavishly restored by Mr. Bronfman.
That’s true; we remember a tense meeting with the photo department when they discovered that the townhouse they were supposed to shoot was covered in scaffolding. But we highly doubt Murphy will get $36 million, and be able to turn a $3 million profit on the property in this market.
Still, best of luck selling the house and finding a new job, Charles. We always had a feeling you were better than FGG, even when you politely refused to answer our questions a year ago.
If you’re curious about Bronfman’s initial sale of the property, the original Dealmaker article on the sale is excerpted below.
Perhaps more astonishing was the price Bronfman had originally paid for the mansion: $3.5 million. Purchased in 1994 from the Foundation for Depression & Manic Depression as a gift for Bronfman’s then-wife, Canadian banking heiress Lisa Belzberg, the 14,000-square-foot property contains six bedrooms, eight baths, six fireplaces (one outdoors), a double-height library with polished wood paneling, a full basement with gym, sauna and wine cellar and a dramatic spiral staircase.
But like many record-breaking deals, this one had its share of fits and starts. After divorcing Belzberg in 2002, Bronfman put the house up for sale for $27 million. The property almost sold twice that year, but both contracts fell through (likely due to a neighbour’s multimillion-dollar lawsuit alleging that the Bronfmans’ $19 million gut renovation in the mid-’90s caused major structural damage to his building, including thrusting a steel beam through a fireplace). The house’s price fluctuated over the next few years, dropping as low as $24 million and rising to $30 million before the lawsuit was settled in June 2005, clearing the way for Murphy’s $33 million bid, $3 million less than the final asking price. (Murphy, for his part, is now refurbishing the façade.)
Despite the damage caused, according to appraiser Jonathan Miller, this kind of renovation, combined with the house’s proximity to Central Park, increased its value substantially. Still, the deal pales in comparison to the one struck by Matthew’s older brother, Warner Music Group CEO Edgar Bronfman Jr., who recently flipped his even more posh townhouse on East 64th Street for reportedly more than $50 million.
Photo from The New York Times
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