Tom Barrack Worth in the News As He Bails Out The Weinstein Company
Tom Barrack, founder and CEO of Colony Capital—now called Colony NorthStar Inc (NYSE: CLNS)—has done it again. He’s come to the aid of yet another distressed Hollywood enterprise, throwing The Weinstein Company a critical capital lifeline. As such, we look at Tom Barrack’s net worth, as he attempts to calm one of the biggest scandals to ever strike Hollywood—through his pocketbook.
What is Colony Northstar? It is a diversified equity Real Estate Investment Trust (REIT) with over 500 employees and offices located throughout the world. The company doesn’t just invest in sound real estate (RE) properties, but RE debt instruments, RE operating companies, non-performing loans, and distressed assets.
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By taking an undisclosed financial stake in The Weinstein Company, Colony has invested in the ultimate distressed asset. It’s a company nobody wants to be linked to right now. According to Bloomberg, Colony might end up buying all of The Weinstein Company’s assets in the end, as toxic as the name is. (Source: “Billionaire Tom Barrack Throws Harvey Weinstein a Lifeline,” Bloomberg, October 16, 2017).
We’re sure it helped that Tom Barrack’s relationship with The Weinstein Company goes back nearly a decade. Colony was part of a consortium that acquired Miramax Studios, Harvey Weinstein’s former company, in 2010 from Walt Disney Co (NYSE:DIS) for $660.0 million. (Source: Ibid).
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Outside of studios affiliated with Weinstein, Colony Northstar has a history of backing other Hollywood deadbeats.
For instance, Colony Norstar averted disclosure by purchasing Michael Jackson’s Neverland estate in 2008 for $23.5 million in debt. It also threw famous photographer Annie Leibovitz a $24.0-million lifeline, allowing her to sidestep bankruptcy.
Producer Harvey Weinstein (L) and founder/CEO Colony Capital, Thomas J. Barrack (Credit: Kevin Winter / Staff/ Getty Images)
While we have no doubt profit was the big motive here (isn’t it always?), perhaps Barrack has some affinity for the entertainment industry. He was quoted as saying, “We will help return the company to its rightful iconic position in the independent film and television industry.” (Source: Ibid.)
Returning The Weinstein Company to its former glory is something completely unfathomable to the average person.
Tom Barrack Net worth & Journey to the Billion Dollar Club
Tom Barrack’s net worth is extensive. He’s a purported member of the “Billionaire’s Club,” with a personal wealth in excess of $1.3 billion, according to the Bloomberg Billionaire’s Index. Only a select few are rich and ambitious enough to construct a 77,441-square-foot estate, equipped with guest house and staff quarters. That’s some select company. (Source: “Billionaire Tom Barrack Is Building Himself Massive Bel Air Mansion,” Wealth-X, February 22, 2017.)
Barrack’s journey to billionaire-hood started in the early 1970s, after he obtained a post-grad Ph.D. in Law at San Diego University. Soon thereafter, he joined the Robert M. Bass Group (RMBG), becoming a principal at the firm a few years later. It was at RMBG where Barrack honed his skills as a distressed asset sleuth, finding distressed industries for RMBG to stake bridge loan investments.
In 1976, Barrack began his own firm, which invested in real estate. He made a fortune buying property amid flat-to-falling prices, by finding strategically distressed assets. By 1980, the S&P/Case-Shiller U.S. National Home Price Index rose by almost 80% within a four-year period, making Barrack look like a genius. He now had his own seed money to use at his discretion.
(Source: “S&P/Case-Shiller U.S. National Home Price Index,” Federal Reserve Bank of St. Louis, last accessed October 18, 2017.)
After some time in public office during the 1980s—most notably serving as Deputy Undersecretary of the United States Department of the Interior in the Reagan administration—Barrack founded his most lucrative venture yet—Colony Capital International in 1991.
Tom Barrack Venture Colony Capital International (Credit: Chip Somodevilla / Staff/ Getty Images)
Barrack wasn’t just a passive owner collecting checks. He was an active member who oversaw the strategic direction of the firm. It went on to accomplish amazing results, strategically buying distressed assets the world over where outsized opportunity was present.
These investments weren’t limited to a specific sector. Barrack invested in hotels, casinos, Hollywood studios, and multiplex commercial and residential properties. He even purchased a 95% stake in French professional soccer club—Paris Saint-Germain F.C.—currently playing in Tier-1 French football league.
In 2010, it was reported that Tom Barrack and Rob Lowe partnered up to manage a new $500.0-million media-and-entertainment investment fund. The goal was the same as it had always been: find, purchase, rehabilitate, and monetize distressed Hollywood assets.
It didn’t take long for Barrack to strike. In December 2010, Colony purchased Miramax Studios from Disney with a consortium of partners—including The Weinstein Company—as part of a joint venture called Filmyard Holdings for $663.0 million. (Source: “Miramax purchase puts Colony Capital in the Hollywood spotlight,” Los Angeles Times, December 6, 2010.)
We don’t have the specific details about the success of that venture, but judging by Barrack’s interest in The Weinstein Company right now, it must be substantial. After all, we’re positive that the Weinstein name carries so much baggage that most companies wouldn’t touch it with a 10-foot pole. That includes a full re-branding of the company, which is still unlikely to make people forget what happened.
But undaunted, Tom Barrack is jumping in. Considering his amazing track record of success, he might be just the man to pull it off.
