Emile Haddad, founder of Great Park Five Point developer, steps down as CEO – press enterprise
Emile Haddad, the real estate manager who spearheaded the conversion of a former airbase into housing, athletics and entertainment in the Great Park neighborhoods of Irvine, is stepping down from his management position at the end of September.
Five Point Holdings announced Monday August 23 that Haddad will move September 30 from the day-to-day management of the company he founded to that of senior advisor. He will also remain on the board of directors of Five Point and serve as its chairman emeritus.
Five Point’s new leadership team includes Stuart Miller, executive chairman of long-time Five Point partner and home builder, Lennar; and Lynn Jochim, COO of Five Point, who is promoted to president.
In addition to its development in Orange County, Five Point also has major real estate projects in Valencia and San Francisco.
Reached by phone Monday evening, Haddad said he was not leaving the company but was rather stepping back from running a listed company with more than 40,000 homes under development. He said he would now “focus on the next opportunities”.
While conceding that the move is, in part, to have more time with his family, his main goal is to work on big ideas to increase shareholder value, fulfill the company’s dream for the Grand Parc while also working on public interest projects like promoting health care projects in Irvine and tackling the housing crisis in the state.
“Today’s announcement was for me to take a step back from day-to-day operational responsibility and procurement management and all that and focus on the things that I’ve always liked to focus on, and that’s what’s the next opportunity within our communities, ”he said.
Haddad, 63, admitted the news was a bit startling, saying even his family and some high-level employees were only aware of the changes just before they were made public.
“I’m not surprised you’re surprised,” Haddad said. “But I can assure you there is no health problem. I was not fired. It’s just a repositioning to move forward and create the right value for the company. … At some point you have to start realizing that there are other things you can focus on.
Haddad said he still plans to keep his office at Five Point headquarters, just south of Great Park in Irvine.
Haddad said he was not replaced as chief executive. With Miller, a Wall Street pro at the helm, Jochim taking care of the day-to-day operations and acting as a corporate advisor himself, “there is no need for a CEO,” he said. he declares.
His real estate work contrasted with his flight from his native Lebanon in the midst of a civil war to come to California in 1986.
He was working as an investment manager for Lennar Homes in 2005 when the closed El Toro Marine base was put up for auction. It was his job to make sure Lennar was the top bidder, no matter the cost.
But in 2008, Lehman Brothers – the company funding the development of Great Park – collapsed as the economy collapsed in the Great Recession.
“People don’t realize… how close this (project) has come to the abyss, and the effort that has been required to keep it together,” Haddad said years later.
California then eliminated redevelopment agencies in late 2010, a move that eliminated another source of funding for Haddad’s Big Park Dream.
Haddad convinced the city to double the number of housing units to be built, allowing Five Point to move forward with its housing development as well as being the developer of the Grand Parc.
A company statement said Haddad “will focus on improving our communities to stay true to the corporate vision and maintain critical relationships nationally and locally, as well as on new businesses and initiatives that the company may consider continuing to improve shareholder value. “
“Emile Haddad has been an innovator and a leader in the national community development landscape,” Miller said. “He founded and developed Five Point from its inception to its current maturity. He has developed an exceptional leadership team that is poised to continue to develop the extraordinary Five Point communities as a true honor to their environment while creating shareholder value. “
Surviving a virus
At Great Park, Five Point – the lead developer and 37% owner of the project – has sold 6,970 residential sites out of the 10,500 planned. In the first seven months of 2021, builders sold 516 homes. In the Valencia FivePoint project of 21,500 homes next to Magic Mountain, 110 homes have been sold since sales began in May. Builders have already purchased 1,268 lots in the northern Los Angeles County development.
Five Point became a publicly traded company in May 2017, with Lennar its largest shareholder, controlling 39% of all shares. Haddad, who owns 3% of the shares of Five point, earned $ 6 million in 2020, including a bonus of $ 5 million.
The company’s shares have not held up well in the era of the pandemic. As of February 2020, the homebuilder has reported a 7% return to shareholders versus 80% for a key homebuilder stock index.
Haddad said projects he would focus on include building Irvine into a hub for healthcare and life sciences, closing the new City of Hope cancer center under development on land leased to Five Point. He wants to stay involved in initiatives coming out of Sacramento to stimulate housing construction and address the housing shortage in the state. And he also intends to concentrate on the development of the places of life and entertainment planned for the Grand Parc.
“I’m going to spend a lot of time working with the city of Irvine to develop this,” he said. “If you run a public company, you don’t have time to do all of this.