April 21, 2012
Los Angeles Times
What kind of man is Dodgers' next owner?
By: Kim Christensen
The L.A. Dodgers have been getting all the ink, but they aren't the only recent acquisition by Chicago financier Mark Walter. They're not even the most important, at least not from John Penn's perch at the old Grubstake Building in downtown Crested Butte, Colo.
Ask Penn about "the new owner" and he'll be talking landlords, not baseball. Last year, Walter bought the building that houses Penn's tobacco shop, a Nepalese restaurant and an art-glass gallery in the ski resort.
Penn wasn't sure what to expect from an out-of-town owner with buckets of cash. The same could be said for Dodgers fans waiting to see what Walter and his partners will do with the team if their record $2.15-billion deal goes through.
Although Magic Johnson is the famous public face of the new ownership team, it's Walter who will be the controlling owner. That means he'll have a hand in everything from player salaries to improvements at Dodger Stadium.
From Colorado, at least, the scouting report is good. Walter not only didn't raise rents, the tobbacconist said, he also paid some contractors who said they were owed money by the previous owner.
"We thought that was pretty cool, since he wasn't really obligated to do that," Penn said. "We don't know what the future holds, but he seems to be a fairly square shooter. He seems like a decent guy."
"Decent" is one word often used to describe Walter, 51, the chief executive of Guggenheim Partners, a financial services company that manages more than $125 billion in assets. He's also private, unassuming and almost studiously unflashy.
Born in Iowa and schooled at Creighton University and Northwestern University Law School, Walter has a net worth of $1.3 billion, according to Wealth-X, a Singapore business-intelligence firm that assesses the fortunes of the ultra rich and ranks Walter seventh among Major League Baseballowners. Walter is not on the Forbes list of the world's billionaires.
Most of Walter's fortune, Wealth-X says, derives from his stake in Guggenheim Partners, a 12-year-old firm founded with family money by a descendant of Meyer Guggenheim, the industrialist and mining magnate who came to this country from his native Switzerland in the 1840s.
Unlike some others in his lofty economic orbit, namely current Dodgers owner Frank McCourt, Walter until recently was seldom in the news — and apparently liked it that way. When the Chicago Tribune contacted about three dozen of that city's top bankers, investors and power brokers after the winning bid was announced last month, most had never met Walter and none said they knew him well.
"I'm a fairly quiet and private person," he said at the time. "So I haven't sought publicity."
Through a spokesman, Walter declined to be interviewed for this article or to provide a detailed resume or other personal information.
The Chicago Cubs season ticket holder did speak with Times reporters when the Dodgers sale was announced and said he would be content to stay in the background with his new team. Longtime baseball executive Stan Kasten will run the operation.
"I'm a baseball fan, but I'm not qualified to make baseball decisions, and I don't want to pretend to be," said Walter, who was over 20 when he saw his first big-league game in person. "I'm here to support and help my people as much as I can. I'm here to cheer as loud as I can."
Tracy Sankot recalled Walter as low-key and easygoing when both attended Thomas Jefferson High School in Cedar Rapids in the late 1970s.
"He was always one of the smartest guys in class, plain and simple, and fairly quiet," said Sankot, who was on the golf team with Walter. "He wasn't the kind of guy who offended anybody or made fun of anybody. He was just a genuinely good guy at that time and you could tell he was destined for success. He was bright, but he never lorded that over people."
Walter was an accounting major at Creighton, where he played intramural sports and was a member of the Philosophy Society, among other activities. He earned a bachelor's degree in business in 1982 and graduated three years later from law school.
He joined a Chicago law firm and later worked for First Chicago Capital Markets, but left in 1996 to found an investment firm, Liberty Hampshire Co., according to reports published at the time. While there he met J. Todd Morley, who would connect him with the Guggenheim fortune.
Morley was chief executive of Links Holdings, a company that dealt in mortgage assets, when he and Walter met in 1999. Morley had been working with Peter Lawson-Johnston II to form Guggenheim Partners, and all three men hit it off, said a company insider who was not authorized to speak publicly about the relationship.
Lawson-Johnston is a great-grandson of Solomon R. Guggenheim, the founder of the New York art museum that bears the family name.
Guggenheim Partners, which has headquarters in Chicago and New York and an office in Santa Monica, manages about $125 billion for wealthy individuals and institutional investors such as pension plans. In all, the firm has 25 offices in nine countries, and its 2,200 employees include investment bankers, securities traders, risk managers and research analysts.
Over the last decade, Guggenheim Partners has built a reputation on Wall Street for being low-key but aggressive. It performed well during the financial crisis, which helped it scoop up marquee bankers including former Bear Stearns CEO Alan Schwartz. In addition to traditional investments in stocks and bonds, the firm invests in distressed companies in hopes of turning them around and also runs hedge funds that engage in sophisticated trading tactics.
A major player in corporate debt, the firm has snapped up a variety of investments, including insurance companies, model-train maker Lionel and a stake in the venture that owns the Hollywood Reporter trade publication. It has been in negotiations to buy Deutsche Bank's asset management business, a move that would quintuple its holdings to more than $600 billlion, Bloomberg News reported in February.
The insider who spoke on condition of anonymity said the firm's success owes largely to Walter's fiscal discipline and his skill as a "very focused, very careful" investor.
"I can tell you he is a guy with one of the great financial minds of our time, and he will help that team," the person said.
Walter has said he is making a significant personal investment in the team, but neither he nor the Dodgers' new ownership group — Guggenheim Baseball Management — has revealed the sources of purchase money in its all-cash bid of $2.15 billion, which topped others by about $500 million and was well above most estimates of the franchise's worth.
"The market drove the price," Walter said, calling the investment "a multigenerational thing my daughter's granddaughters will own."
He and his wife, Kimbra, also a lawyer, live with their school-age daughter in Lincoln Park, a well-to-do neighborhood north of downtown Chicago and adjacent to Lake Michigan.
In the last decade, the couple have bought several properties on North Orchard Street, including a 6,700-square-foot home for $3.9 million in 2004, public records show. Since February 2011, they have purchased two other homes on the same block, for $2.8 million and $2.3 million, respectively, records show.
Their street was featured in a 2006 Chicago Tribune Magazine story headlined "Attack of the Giant Houses!" that skewered mansions going up on "Chicago's new Gazillionaire's Row." The Walters were not mentioned.
Those who know the couple say they are not given to ostentation.
"They are incredibly low-key," said Christine Zrinsky, vice president for development at the Lincoln Park Zoo, where Kimbra Walter is a trustee and her husband a major fundraiser through Guggenheim Partners, the presenting sponsor of the annual Zoo Ball.
"They are very unassuming, very polite, and they care deeply about the city and their family," Zrinsky said. "They have not made a big splash in the city as far as getting their names out there. They are not self-promoters in any way, shape or form."
Federal Election Commission records show that Walter last year contributed $30,800 to the Democratic National Committee and $5,000 to Obama for America, and he has supported a variety of civic causes in Chicago. He is a trustee of the Solomon R. Guggenheim Foundation, which oversees Guggenheim museums and art collections in New York, Italy and Spain.
In the interview with The Times last month, Walter said he wanted the Dodgers organization to be "a pillar in the community" in Los Angeles.
"Something like this can really be a platform for philanthropic and other activities and community development and citizenship, which I think the world is in need of now," he said.
Several years ago, as part of a Milken Institute campaign to raise money to fight prostate cancer, Walter toured Major League Baseball parks with former Dodgers manager Tommy Lasorda.
"He thinks about doing things for other people," Lasorda said. "I am happy he is taking over the Dodgers, and there is no doubt in my mind he will be successful."
Walter spends a good bit of his off time with his wife and daughter in Crested Butte, where one of his limited liability companies in January paid $4 million for a 6,521-square-foot ski retreat on 1.5 acres. The five-bedroom, seven bathroom home had been on the market for as much as $6 million.
Bill Oberling, a longtime area resident, keeps an eye on more than a dozen properties for absentee owners, including Walter. He's also taken river trips and gone hunting and skiing with the financier.
"I just kind of find him to be a down-to-earth Midwestern guy," said Oberling, who counts himself lucky to know Walter — especially now.
"I'm hoping he can get me some tickets when the Dodgers play the Rockies," he said.