Robert Campeau
Robert Joseph Antoine Campeau (August 3, 1923 – June 12, 2017) was a Canadian financier and real estate developer, who engineered the largest retailing bankruptcy at the time in U.S. history.[1] Starting from a single house constructed in Ottawa, Ontario, Campeau built a large land development corporation around the development of the suburb of Kanata. Expansion in the U.S. led Campeau to diversify into the ownership of retail department stores to anchor commercial development projects. The Campeau Corporation used leveraged buyouts to buy the department stores and went bankrupt when it could not maintain the debt payments.
Robert Campeau | |
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| Born | Robert Joseph Antoine Campeau August 3, 1923 Chelmsford, Ontario, Canada |
| Died | June 12, 2017 (aged 93) Ottawa, Ontario, Canada |
| Occupation | financier and real estate developer |
| Known for | development of Kanata and Ottawa; largest retailing bankruptcy in U.S. history |
Early years
Born in Chelmsford, Ontario, Campeau's formal education ended in Grade 8, at the age of 14. He talked himself into jobs at Inco as a general labourer, carpenter and machinist. In 1949, he entered the residential end of the construction business. His first project was a single home constructed in partnership with his cousin in Ottawa, Ontario.
Real estate development
In Ottawa, Campeau was able to construct both office complexes and residential subdivisions to accommodate Canada's rapidly expanding civil service. Campeau frequently found himself at odds with Ottawa Mayor Charlotte Whitton over planning decisions. Whitton was quoted as saying, "When I look at his (Campeau's) houses, I think perhaps nuclear bombardment might not be such a terrible thing after all."[2] His Campeau Corporation had two main rivals in the residential housing market: Assaly Construction Limited and Minto Developments Inc., the latter owned by the family of future Ottawa Mayor Lorry Greenberg. Despite opposition from Whitton, Campeau developed a reputation as a high-quality builder and became the most successful in the city. A street is named after him in the Ottawa suburb of Kanata, much of which he developed.
For many years, it was city policy that buildings in the downtown core were not to be taller than the Peace Tower of the parliament buildings. Campeau objected to this rule and was drawn into conflict with city council over large high-rise developments such as Place de Ville.[3]
Due to his relationships with many civil servants and ministers, he was able to have most of his projects approved. He counted amongst his personal friends politicians like Jean Chrétien, Jean Marchand, André Ouellet, Marc Lalonde, and Michael Pitfield. Campeau's real estate development success soon spread outside Ottawa. In Toronto his developments included Scotia Tower (the city's third tallest skyscraper) and the Harbour Castle Hotel (now part of the Westin Hotels chain).[4]
Corporate takeovers and bankruptcy
In the 1980s, Campeau embarked on a series of leveraged buyouts (LBOs). His first attempt as a large takeover was the Royal Trust Company, which was valued at Can$7 billion compared to the $866 million for Campeau Corporation. The bank was later sold and is now part of the Royal Bank of Canada.[5]
As his business expanded, Campeau ventured into the United States, looking for acquisitions that would add shopping mall real estate to his portfolio of assets. Through junk bond LBOs, Campeau Corporation gained control of Allied Stores for US$3.6 billion in 1986 and Federated Department Stores, owner of Bloomingdale's for $6.6 billion in 1988.[5] Campeau retained well-known investment banker Bruce Wasserstein to assist with the transactions. However, the debt obligations that needed to be covered following the merger were too large and exacerbated by a market downturn that hurt retail sales; Campeau Corporation was unable to meet its debt obligations.
By June 1989, following Campeau's takeover of Federated Department Stores, both Federated and Allied Department Stores were losing money despite increased sales in year-over-year comparisons.[6] Federated and Allied eventually filed for bankruptcy reorganization. The company was eventually acquired by the Reichman brothers who filed for bankruptcy themselves and Campeau Corporation ceased to exist.
A New York Times editorial stated: "Any corporate executive can figure out how to file for bankruptcy when the bottom drops out of the business. It took the special genius of Robert Campeau, chairman of the Campeau Corporation, to figure out how to bankrupt more than 250 profitable department stores. The dramatic jolt to Bloomingdale's, Abraham & Straus, Jordan Marsh and the other proud stores reflects his overreaching grasp and oversized ego."[7]
Personal life
Campeau resided in a lakeside castle in Austria and he became involved in some real estate projects, including developing a large subdivision in Teltow (former GDR) near Berlin, Germany. That project failed and Campeau's company went bankrupt in 2001. The funds of the charitable foundation (Robert Campeau Family Foundation) used in his business were lost.[8]
In 1996, Campeau and his wife, Ilsa, mother of three of his children, separated. While she stayed in Austria, he first lived in Berlin with Christel Dettmann, a former East German politician, and then he returned to live in Ottawa in 2001 together with Christel.
The divorce proceedings went on for many years; Ilsa's pleadings were struck and, in the end, an Ontario judge ruled in his favour. Campeau died on June 12, 2017, in Ottawa.[9]
Bibliography
- Babad, Michael; Mulroney, Catherine.Campeau- The Building of an Empire,1989, ISBN 0-385-25208-0
- Rothchild,John.Going for broke: How Robert Campeau bankrupted the retail industry, jolted the junk bond market, and brought the booming eighties to a crashing halt,1991, ISBN 0-14-017316-1
References
- Campeau`s U.S. Stores File For Bankruptcy, Chicago Tribune, January 16, 1990.
- Roussopoulos, Dimitri (1981-12-01). The City And Radical Social Change. Black Rose Books. p. 308. ISBN 0-919618-82-0.
- Keshen, Jeff; Nicole St-Onge (2001-05-02). Ottawa: Making a Capital - Constuire une capitale. University of Ottawa Press. p. 465. ISBN 0-7766-0521-6.
- Gagnon, Charles-Antoine (2017-06-17). "Le promoteur immobilier Robert Campeau est décédé" (in French). LeDroit.
- Patton, Phil (1988-07-17). "The Man Who Bought Bloomingdale's". New York Times.
- "Campeau's Federated, Allied Post Losses". Chicago Tribune. June 14, 1989.
- "The Grotesque Campeau Failure". The New York Times. January 17, 1990.
- Magazine, Phil Patton; Phil Patton, Co-author Of voyager, Is A. Frequent Contributor To The Times (1988-07-17). "The Man Who Bought Bloomingdale's". The New York Times. ISSN 0362-4331. Retrieved 2016-05-04.
- http://www.legacy.com/obituaries/nationalpost/obituary.aspx?n=robert-campeau&pid=185828832
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