LONG MEMORIES
LONG MEMORIES
BY TOM DOWLING
This feature appeared in the 1984 Forbes 400 edition.
BERNARD BOHN
“WE USED TO CALL HIM UP IN THE OPERATING ROOM,” recalls Art Carlson, a restaurateur who formerly helped run Dr. Laszlo Tauber’s 7.2 million square feet of rental properties. “We’d say we need so many million tons of concrete, so many hundred thousand linear feet of Sheetrock. He could have had his hands in someone’s innards, but he’d think a second and say, ‘No. That’s too much.’ Then he’d give you the right numbers.”
Tauber, 69, is no longer building, but seeing him at work you would hardly know it. Sitting at his cluttered desk in Alexandria, Va.’s Jefferson Memorial Hospital, he fields a few quick phone calls: so much for the air rights to that New York City building, so many ccs. for this patient. Finally, he leans back, owlish behind black-rimmed glasses, and in a soft Hungarian accent recites a few curious dates: “Zsa Zsa Gabor, born Feb. 6, 1917; sister Magda, August 1915; Eva, Feb. 11 1919.” There is a hint of a melancholy smile.
Why do the Gabor sisters’ birth dates interest Tauber? Since arriving in America in 1947, a physician without U.S. certification and virtually penniless, Tauber has progressed from a general practice in a working-class Washington, D.C. neighborhood to chief of surgery in a 120-bed hospital he built himself. As an entrepreneur, he has gone from a $9,500 investment in a site for a modest apartment house in the 1959s to a $250 million real estate fortune built from scratch—largely outside office hours.
A slightly built man given to speaking in a grave manner, he leaves no doubt his figures on the Gabors are both scrupulously correct (though Zsa Zsa’s manager claims she is younger, while Eva’s agent refuses even to discuss her age) and of central relevance to what he calls “ceaseless drivers,” which have made him one of the rare members of The Forbes 400 to get there in his spare time.
In Hungary Tauber was a brilliant student and a first-class gymnast who won 17 championships in his youth. “I remember more vividly the championships I lost than those I won,” he notes. “I never relaxed. They used to say I never had a childhood.”
Tauber steps right out of the pages of Horatio Alger Jr.—except it’s the Hungarian-Jewish translation. Guilt seems to gnaw at Tauber in a way totally foreign to the American success ethos. Tauber survived the Holocaust, which claimed 600,000 Hungarian victims, not the American School of Hard Knocks. To the Holocaust survivor the inevitable question is: Why me, not the others?
Therein the significance of the Gabor sisters. Tauber remembers that they lived for a time at No. 30 Ilka Street in Budapest, while his own boyhood was passed at No. 19. Both families were Jewish (though the Gabors deny that, too). Vilmos Gabor, says Tauber, spent World War I at No. 30 Ilka Street, “busy making Jolie Gabor pregnant with three gorgeous girls.” But Tauber’s father, drafted into the Austro-Hungarian Army four days before Tauber was born, died two months later on the Russian front.
During the ’30s a quota strictly limited the number of Jews entering Hungarian medical schools, but Tauber, a war orphan, had a crucial edge in a crowded field. The scarcity of doctors in wartime Hungary kept him out of the labor camps until 1944. And it was medicine that enabled him to immigrate to America.
In 1970, while recuperating from a serious heart attack, Tauber wrote an autobiography that was never published. The phrase “real estate” never appears. The orderly pursuit of a vast business fortune seemed to pale against the backdrop of his life: the patient whose life he saved, who went on to become a Nazi collaborator responsible for the deaths of over a hundred Jews; the proper Swiss governess who was able to save Tauber from the Gestapo by pretending he was her Gentile lover.
The principal baggage Tauber speaks of bringing from Budapest to the U.S.—besides such memories—is a strong sense of personal loyalty. Indeed, “loyalty” is the phrase his business associates most often cite. He has sought out, in both Hungary and Israel, scores of individual Jews and “righteous Gentiles” from his past to support with monthly checks.
Tauber is also an often disappointed romantic. Hungary did not return his early patriotic affections. Israel, to which he tried to immigrate after the war, gave the medical position he had sought to another man. The segregated bathrooms at Johns Hopkins Hospital in 1948 made him question Abraham Lincoln’s promises of civil rights in America.
But he was not always disappointed. “The greatest experience of my life?” he muses. “My first wife and I were fans of Ingrid Bergman when she left her husband for Roberto Rossellini. I lost patients defending her, and when she became an underdog I became even more a fan. We decided to name our daughter after her and my wife wrote a letter to tell her. She wrote back and sent us her picture. After my wife divorced me in 1964, my friends were always trying to fix me a date. ‘Who do you want, Laci?’ they asked. Finally, I said, ‘Ingrid Bergman.’ So Ingrid Bergman came to Washington in a play and a friend called and said, ‘Laci, you have a date with Ingrid Bergman.’ Boy! I took out my elevator shoes. We had dinner at the Watergate. I’ll never forget the look on her face when she first saw me: Boy, this is all the guy I could get? But she was wonderful! That was the only time in my life I felt a big shot. I asked her why she, a great actress, would write me back a letter. She looked at me in the eye, and I’ll never forget it. She said: ‘Do you think I got so many kind letters at that time?’”
Medicine was Tauber’s profession, his umbilical cord to Europe, to Hungary and to the traditional Jewish humanitarian ideal. The real estate was his umbilical cord to the go-getting America he adopted.
He started with small apartment buildings in blue-collar neighborhoods. The neighborhoods started to decline, and he dumped the buildings. Instead of quitting real estate, he looked for bargain property in the burgeoning suburbs.
“Dr. Tauber’s training is in Europe,” says Maryland banker Marvin Lang. “There, he saw that buildings, if nothing else, last for hundreds of years. He envisions a deal 20 years down the line. Where most builders just want to turn dollars, Dr. Tauber wants to build assets.”
HIS FIRST BIG PROJECT, IN 1959, was a shopping center/residential complex in Bethesda, Md., built on cheap land (49 cents a square foot) Tauber had found. Three years later, in an expansion of the complex, he landed a federal tenant with a 10-year lease.
How did he line up the federal government? With cheap land, cheap leases and an office staff of two muddy-boots construction men who roamed all over his sites, breathing down subcontractors’ necks to control costs. So he could easily underbid builders offering fully priced land bought by high-overhead, 100-man offices whose occupants wore shiny shoes and rarely visited the sites. Government bureaucrats might not be thrilled with his solid, if plain-vanilla buildings, but they were normally constrained by law to take the low bid. And Tauber, who obtained mortgages based on the appraised value of the completed projects, kept his costs well below the amount borrowed. That way he could in effect build with no permanent outlay of his own cash. Later, when the leases ran out, he could safely charge his settled-in tenants substantially higher rents. Such were the strategic little details that appealed to Tauber’s quintessentially conservative temperament.
In the late 1960s the Nixon Administration urged the dispersion of the federal bureaucracy from downtown Washington, and Tauber found himself sitting pretty. A 1.2-million-square-foot office building in Rockville, Md., which would house 7,000 Health & Human Services employees, was Tauber’s major breakthrough as a builder. Despite a fire, he delivered Parklawn on time. It is one of the largest privately owned office buildings on the East Coast and is now worth an estimated $150 million. And three more major government office buildings followed.
Then came his albatross. One of his projects, Buzzard Point, was a 415,000-square-foot office building to house some 2,500 Securities & Exchange Commission employees on a desolate site in southwest Washington. Then-GSA Administrator Arthur Sampson signed a lease with Tauber, as low bidder, at $2.5 million a year. As usual, the complex was completed ahead of schedule. But the SEC refused to move in. To D.C. bureaucrats Buzzard Point was Siberia—no restaurants for a mile around. The building sat largely unoccupied for six months, while at least five different federal agencies declined it. But Tauber had a lease with the government, and the rent kept coming in. The Washington Post latched on to the story and delivered a hard-hitting series, implying shady practices. The General Accounting Office and FBI investigated but found nothing to prosecute.
Sampson, who had insisted Buzzard Point was a sound deal throughout the long ordeal, later found himself out of work and a pariah in the Washington building community. Tauber hired him to run a moneylosing coal-washing operation in Alabama. “I was as surprised as anyone when Dr. Tauber offered me a job,” Sampson says. The job triggered another accusatory Post article. Tauber says with a shrug, “I hardly knew the guy, but he stuck up for me in Buzzard Point. I knew it would give me a bad appearance. Should I not give a guy a job because of appearances?”
With construction costs rising and interests rates prohibitive in the late 1970s, Tauber switched from building office complexes to buying them. In the last two years he has been using “multicurrency financing”—he borrows foreign currencies abroad at roughly 6.5% to avoid the 13% American rates. “There are pitfalls,” he allows, but he avoids them through puts and calls on foreign currencies in the futures market. “I’m not heartbroken to be out of building,” he says. “It’s not an ego trip for me. Surgery is the satisfaction of my life. Living in the past is my love.”
He continues to search out people in his past who did him a good turn. “You remember that governess?” he says. “The one who took me into her bedroom to save me from the Gestapo? Well I finally tracked her down after 40 years. I called her in Switzerland and introduced myself. She didn’t remember me. I said, ‘You must remember me, you hid me from the Nazis. Anything you need, anything you want, I will do it for you.’ She got angry. She screamed, ‘You were not in my room. I did not hide you. I don’t need anything from you.’”
Tauber sighs, a man with dreams that are fading, even as he acquires the means to realize them. F
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