Hedge fund trader splashes the cash
Steven Cohen is known for his rapid-fire trading style, moving in and out of stocks with dizzying speed at his hedge fund SAC Capital Advisors.
He seems to be taking a similar approach to his real estate.
Mr Cohen reached a deal last week to pay $US60 million ($57.5 million) for an ocean-front property in East Hampton, on Long Island, New York. The home, which was listed for sale late last week, is down the road from one he already owns. At the same time, he has put on the market his duplex apartment in the Bloomberg Tower on the East Side of Manhattan. His asking price: $US115 million.
News of Mr Cohen's real estate activity surfaced a day after reports that he bought Picasso's Le Reve for $US155 million from US casino tycoon Stephen Wynn. The acquisition is one of the priciest private art deals ever completed. He has quietly offered other works from his vast collection up for sale, several dealers say.
Mr Cohen's conspicuous consumption comes amid continuing scrutiny of his business practices. SAC is at the centre of the US government's broad investigation into insider trading at hedge funds. This month, Mr Cohen, 56, signed two settlements in which the fund agreed to pay federal securities regulators $US616 million to resolve accusations of illegal conduct at SAC.
Judge Victor Marrero of US District Court in Manhattan is to hold a hearing to consider the terms of the agreement, which requires his approval. SAC has resolved the cases without admitting nor denying wrongdoing, a settlement practice used by the government that has come under criticism from some judges for being too lenient.
Mr Cohen is not expected to attend the hearing, but if Judge Marrero signs the agreement, the $US616 million will effectively come out of Mr Cohen's pocket. The fine is being paid by the SAC management company, of which Cohen owns 100 per cent. SAC investors will not absorb any of the cost.
The cash would put only a modest dent in Mr Cohen's net worth, which is said to be nearly $US10 billion, according to the Bloomberg Billionaires Index. He is one of a handful of hedge fund managers who have redefined wealth on Wall Street. Investors such as John Paulson of Paulson & Co, which made a fortune betting against the mortgage market, and Carl Icahn, the activist investor bidding for computer manufacturer Dell, have recently earned billions of dollars in a year.
Many of them have homes in the Hamptons, a favourite summer getaway of the Wall Street set. Mr Cohen bought a home there in 2007 for about $US18 million. It is behind an ocean-front property owned by James Chanos, another hedge fund manager.
Now Mr Cohen can claim an ocean view. A couple of doors down from his other house, his new 10,000-square-foot home sits on seven acres with a tennis court and pool. "High ceilings, antique oak and limestone floors, barn-style double-height family room, media room, large ocean-view master suite plus six additional bedrooms," the listing said.
The property was previously owned by Robert McKeon, a founding partner of the investment bank Wasserstein Perella. Mr McKeon committed suicide in September at the age of 58.
The $US60 million purchase is among the most expensive real estate sales transacted on Long Island's South Fork. It is unclear whether Mr Cohen is selling his first house.
Mr Cohen is a charter resident of the Bloomberg Tower on Lexington Avenue. He paid about $US24 million in 2005 for the 10,000-square-foot property on the 51st and 52nd floors.
If Mr Cohen gets the $US115 million that he is asking for his Bloomberg Tower pad, it would be the highest-priced sale ever of a Manhattan apartment.
Two duplexes at One57, a tower being built in Midtown, are under contract with unnamed buyers for $US90 million. If completed, those deals would surpass the $US88 million sale of a penthouse owned by the financier Sanford Weill to a Russian billionaire, for his daughter.