A Family That Plays Hardball

Forbes magazine estimated Lerner's net worth last month at $1.5 billion, No. 242 on its list of the richest Americans. The family's foundation gives out more than $2 million annually to, among others, the Lerners' Chevy Chase synagogue, Ohr Kodesh; Lerner's alma mater, George Washington University; and the Hebrew University of Jerusalem. Lerner and his wife, Annette, gave more than $1 million toward the founding of the U.S. Holocaust Memorial Museum.

It is a classic American success story of a man who started selling homes at 21 to support his family after his father's death. The Lerners attribute their success to working hard, understanding customers' needs and paying attention to detail. At the peak of his mall building in the 1970s, Lerner would travel the country studying the latest in malls and then present his architects with lists of 500 specifications, including material, lighting and sightlines. He remains involved in the job's finer points. At one of the Nationals' last games of this season, a guest in Lerner's owner's box said he commented about the precise cost of baseballs for the team next season: $17,000.

"He's very focused," said Lew, the sports commission chief executive, who has been in numerous negotiations with the Lerners. "He knows what works and what doesn't."

Others say the Lerners' financial rise is also due to their unyielding style. That was at the heart of a bitter fight in a pivotal partnership in Lerner's career, with the family of developer Isadore Gudelsky.

Gudelsky, who knew Lerner's father-in-law, invited Lerner, then a young real estate salesman, to join him in building Wheaton Plaza mall in the 1950s. With just $6,900, Lerner acquired a 5 percent stake, which doubled for the group's next venture, building a mall on 86 acres of farmland in Fairfax: a crossroads known as Tysons Corner.

Gudelsky, who, Lerner said, was "almost like a father" to him, died suddenly in 1963. Lerner did not get along well with Isadore's brother Homer, the new majority partner. Gudelsky and other partners charged that Lerner was delaying renovations at Wheaton Plaza and discouraging Hecht's from locating a store there in deference to White Flint Mall, where Lerner held a larger stake with a different partner.

The group fought most about Lerner's desire to build a second mall at Tysons, with his partners opposed to anything that might compete with Tysons Corner Center, which opened in 1968. Lerner was also pressing for a larger share than the 25 percent stake he then held in the Tysons holdings.

Frustrated with Lerner's assertiveness, Gudelsky and other partners decided to sell the land, dubbed Tysons II, to developer and publisher Mort Zuckerman, who offered $25 million. But Lerner refused to sell. Lerner and Zuckerman faced off in an auction, which Lerner won for $35 million. The deal collapsed on technical grounds, but moments before a second auction, in 1983, Lerner and his partners announced that he had bought out Gudelsky and his partners for $21 million.

Lerner had what he was after, the most central parcel at Tysons. Two years later, Lerner and the partners cut the rest of their ties when they sold Tysons Corner Center for $142 million. "Finally, it was obvious to us and our family that we should part," Lerner said in the recent interview.

Jack C. Merriman, the lawyer who represented Gudelsky and the other partners, laid the breakup at Lerner's feet. "His style of negotiation is to take a stand and stop; there's no budging," Merriman said in an interview. "He was just hard-nosed, and he's been very effective with that style."

He added: "I don't think Ted minded if people liked him or not. He didn't let anyone's opinion of him get in the way. It didn't seem to bother him whether he made enemies or friends."

The Lerners' other contested dealings have led to similar assessments, although some contractors and brokers declined to discuss them publicly, for fear of losing business with the family.