Founding of Lightstone (1988–2003) Lichtenstein developed an avid interest in property during his twenties and launched his real estate career. At the time, he was living in a two-family home in
New Jersey. In 1986, Lichtenstein used $89,000 in credit card debt to buy a multi-family home in New Jersey. Over a three-year period, Lichtenstein reinvested capital from his properties to fund the down payments on more properties. He then leveraged the new properties with loans, allowing him to continue to add to his portfolio. Following the success of his small real estate business, Lichtenstein founded The Lightstone Group in 1988. The company was founded in
Lakewood, New Jersey, and grew quickly during the early years of the company's history. During the first few years of Lightstone's activity, Lichtenstein focused on acquiring multifamily properties in the New Jersey area. In the 1990s, Lichtenstein grew The Lightstone Group's portfolio to over 20,000 apartments in 28 states. The company was recognized as one of the top 30 apartment owners across the
United States around the same time. From 1997 onwards, there was a housing price boom in the United States, which lasted for nearly a decade. The boom was good for the existing portfolio Lichtenstein had amassed, but it made it more difficult to find affordable properties to purchase. After seeing the potential of the single mall in Puerto Rico, Lichtenstein made his first major deal in the real estate market in 2003. He purchased the entire Prime Retail portfolio for $638 million. The portfolio consisted of 37 properties spread across a number of states in the US, in locations such as Pleasant Prairie, Wis., Odessa, Mo, and Gaffney, S.C. The acquisition made Lightstone the second-largest owner of outlet malls in the country after Chelsea Premium Outlets, owned by
Simon Property Group Inc., the nation's largest mall owner. During the same year, Lichtenstein returned to investing in housing with a number of large investments in
affordable housing. He purchased 5,000 units across 19 multifamily rental properties in
Detroit. It was reported that the entire deal was for a total of $200 million. His second housing deal of the year was in
Birmingham, Alabama, where he spent a total of $303 million on a number of apartment buildings. While expanding the diversity of investments, he also moved into
hospitality in 2007 with his biggest single deal to date. Lightstone acquired Extended Stay Hotels for a total of $8.1 billion, making Lightstone the
parent company of one of the largest mid-priced hotel brands in the United States. At the time, it was said the hotel group had 683 hotels across 44 US states and
Canada. Extended Stay later sought bankruptcy protection due to the
Great Recession.
Recent investments (2011–present) Lichtenstein's Lightstone Value Plus was one of a number of REITs attracting attention from investors, due to market instability. In late 2010, REITs raised an estimated $9 billion, with a 6.5 percent annual yield. Lightstone Value Plus was the 18th-largest non-traded United States-based REIT, with a dividend of seven percent. That percentage was much higher than many other non-traded REITs during that period. Following the success of Lightstone Value Plus, Lichtenstein launched a second non-traded REIT. Lightstone Value Plus II followed a similar strategy to the initial fund, focusing on investments across a number of markets. The sale of
Prime Retail and both REITs gave Lichtenstein a large fund to invest throughout 2011. According to reports, there was an estimated $350 million remaining from the Prime Retail sale, which was reinvested into new deals. In 2011, Lichtenstein purchased Festival Bay Mall in
Florida for $25 million, Crown Plaza Boston North Shore hotel for $10 million and a residential development in
Long Island City, New York, for $19.3 million. Lichtenstein and
Lightstone Group announced the launch of Phoenix Development Partners, which aimed to develop large-scale renting opportunities in
New York City. Despite shifting his focus to New York City-based investments, Lichtenstein continued to grow his portfolio in other locations across the United States. In September 2012, Lightstone Group announced they would be purchasing a $51 million residential development in Long Island City. In 2013, Lichtenstein and Marriott completed their first deal, the purchase of three
Marriott-branded hotels in
Iowa and
Ohio for $21 million. Later that year, Lichtenstein traveled to
Israel to discuss entering the Israeli debt market. Loans from Israel were used to underwrite a number of developments in
Brooklyn's Gowanus Canal area. Following
Amazon's decision to abandon its plans to build a headquarters in Queens, Lichtenstein called it the "worst day for NYC since
9-11," adding that "this time, the terrorists were elected." ==Investments==