Maurice Smith is a business journalist with 20 years' experience in newspapers and broadcasting. He is the author of Great Scots Families in Business.
Empire, A Tale of Obsession, Betrayal and the Battle for an American Icon,
by Mitchell Pacelle, John Wiley & Sons Inc
The Empire State Buliding has been at the centre of many an intrigue, business battle and worse during its 70-year history. Yet it remains an icon, the ultimate Manhattan skyscraper, attracting thousands of tourists each year.
Behind that classic Art Deco façade and those lines of visitors snaking towards the elevators that bring you to one of the world's ultimate views, an unprecedented legal wrangle has been raging about the very ownership of the Empire State Building. And in terms of intrigue, twisting plot lines and international probes, this story has it all.
The building, still home to hundreds of small businesses, was built against the odds in 1931. Its finances were shaky before the project began, and the building was completed by 3,000 workers toiling to avoid the dole during the Great Depression. Within two years it narrowly avoided bankruptcy.
It has survived many business scandals, numerous shootings and suicides, and even a freak accident in 1945 when, lost in heavy fog, a US military B-52 bomber smashed into its side, destroying three floors more than 90 feet from street level. The Empire State Building, scene of the famous movie King Kong, has a history that would defy the most imaginative story-plots.
Inevitably, the wrangle which is subject of a book by New York journalist Mitchell Pacelle, has a strong family angle. It concerns some post-war real estate wheeler-dealers, an eccentric Japanese billionaire and his daughter, and those famous – or infamous – denizens of Manhattan property, Leona Helmsley and Donald Trump.
The story begins in the 1980s, when Japanese speculators were falling over themselves to buy up land and property all over the US and Europe, boosted by the strong yen. They believed their investments would never falter. The reclusive Hideki Yokoi, a speculator with an unsavoury reputation, instructed his daughter Kiiko Nakahara, to start a spending spree that would peak with the much-disputed "purchase" of the Empire State Building in 1992.
Nakahara and her French husband had been spending like crazy, snapping up English country homes, Scottish castles and French chateaux as if there was no tomorrow. But the Empire State Building deal led to many years of separation for them, as they fought extradition and other legal orders, and estrangement with Yokoi, who was to accuse his daughter of acting without his consent in many of her deals.
The problem came to a head when it arose that the building technically belonged to Nakahara rather than the family business back in Japan. She claimed the building was a gift, something her father – recovering from a stroke while in jail – denied vehemently. The full truth has never really emerged in this tangled tale of lawyers, deal-making, claims and counter-claims.
The real power over the Empire State Building lay not with its owner but the descendants of shrewd operators Lawrence Wien and Harry Helmsley, who secured a 114-year lease for paltry sum from the Prudential insurance giant back in 1961. Their successors, including Harry's wife Leona – jailed for tax evasion in 1992 – enjoyed real power over the building, its management and its rental income, guaranteed until 2075.
Here the fun started. The Japanese buyers paid US$40 million for the privilege of owning an international icon, with no means of deriving income from it because a separate party owned the lease. Enter Donald Trump, for many years a bitter rival to Helmsley, who hoped that by proving mismanagement he and his partners could break the lease and take over the entire business.
This is a story with many twists and turns. But there are several clear factors which will be familiar to anyone involved in a family business.
Firstly, those who had well thought-out legal documents – leases, acquisition deals, succession plans and even private wills – won out in the end. Nakahara and her father (since deceased) lost out because they had too few formal agreements and no real evidence as to which was telling the truth. There is evidence to suggest that even Donald Trump had been misled, although his antipathy to Helmsley and ambition to take over the Empire State Building probably influenced his judgment.
Secondly, there is no more bitter falling-out than between blood relatives. Yokoi, his daughter and her half-brothers tore at each other in their efforts to prove that each was at fault as the original family business descended into chaos.
This is a rip-roaring tale of deceit, scandal and conspiracy, spanning three continents. In American TV fiction, the Ewings of Dallas cornered the market in family business. The Empire State Building story beats them hands down for a ripping business story.