Mireya Acierto/Getty Images; Samantha Lee/Business Insider
A week before a $1.75 billion deal would be announced to buy JCPenney, a rescue of the 118-year-old retailer seemed to be slipping away behind closed doors.
“We would like to do it, but we’re pushing too hard,” one of the chief bidders, David Simon, chairman and CEO of the country’s biggest mall owner, Simon Property Group, told his friend and business partner, Jamie Salter. Salter is the CEO of Authentic Brands Group, which controls several well-known brands and has teamed up with Simon to buy up bankrupt mall staples including Forever 21 and Brooks Brothers.
Whether it was a bluff or genuine retreat, the group of lenders holding $5 billion of debt against the department-store chain capitulated. “I think we just bought it,” Salter recounted Simon telling him in a follow-up call.
Negotiations would continue, and Simon would flash another hallmark of his hard-bargaining style: his infamous temper.
“We’ve had a few screaming matches, including earlier today,” a lawyer said in a Texas bankruptcy-court hearing.
Simon, in partnership with another large landlord, Brookfield Property Group, is now set to acquire JCPenney’s brand and operations, including 550 stores it owns or leases. It’s his largest push yet beyond owning malls into possessing the retail businesses that occupy them, a divide few owners have crossed.
Mounting a turnaround of JCPenney, which has eluded a string of CEOs and the hedge-fund billionaire Bill Ackman, will test Simon’s ability to juggle conflicting roles and his strategy to reinvigorate a mall business threatened by bad news from changing consumer habits, to the rise of e-commerce, and, in recent months, a global pandemic.
Business Insider spoke with more than a dozen people who know and have worked with Simon to learn more about the press-shy mall king and his career make-or-break moment. They described a savvy, ultracompetitive CEO who so far has made prescient moves, steering his company into safer and forward-thinking investments as the US was reaching mall oversaturation.
But some also pointed to Simon’s winner-take-all mentality and sharp elbows as a potential liability as he increasingly relies on partners and a more collaborative relationship with tenants.
SUBSCRIBE NOW TO READ THE FULL STORY: Inside the rise of real-estate titan David Simon, the country’s top mall-owner with a legendary temper facing a make-or-break moment with a $2 billion bet on troubled JCPenney
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