The Promote Podcast Sobrato's Silicon Sizzle & Macklowe Unfurled
Sep 25, 2025
Discover how the Sobrato Organization thrived in the real estate boom fueled by Nvidia, amassing a massive portfolio through bold strategies. Learn why major developers like Toll Brothers are exiting multifamily projects amidst market pressures. Meanwhile, Harry Macklowe makes his return to Manhattan development, navigating challenges around landmark regulations and community opposition for his new luxury project at 809 Madison Avenue. Tune in for insights on the evolving landscape of commercial real estate financing and development!
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Dominant Tech Buyers Distort Real Estate Pricing
- NVIDIA's buying spree has turned Silicon Valley landlords into huge winners who can capture outsized pricing power.
- When dominant tech firms want specific locations, normal comps and cost-of-capital constraints often stop mattering.
The Sobrato–Berg Partnership
- John Sobrato and Carl Berg combined complementary skills: Sobrato as salesman and Berg as the finance/inside operator.
- They aggressively leveraged deals, once borrowing 100% of purchase price to build their 12M sf portfolio.
Land Value Compound Drives Massive Gains
- Land value compounding in places like Silicon Valley turned early cheaply-built product into enormous windfalls decades later.
- Selling to a buyer with the lowest cost of capital (e.g., Jensen Huang's NVIDIA) is often the optimal exit for owners.