Jonathan Gray, Blackstone’s Real Estate Wizard Behind the Curtain

He's taken over the world, so why not the firm?

Gray at play. (Fred Harper)

In February 2007, Sam Zell told Jonathan Gray to buy a motorcycle.

Mr. Gray, head of the real estate division at private equity powerhouse Blackstone (BX) Group, had just closed on the purchase of Mr. Zell’s Equity Office Properties. Blackstone had announced its bid the previous November, just 13 months after Mr. Gray had stepped into his new role. He had spent his entire career at the firm, so his ascent was not so surprising, and had managed 10 deals worth a combined $32 billion so far, so the territory was not exactly new. All the same, Mr. Gray was 37 years old at the time, and he had embarked on the largest leveraged buyout in history.

On Jan. 18, less than a month before the deal was to close, Vornado Realty and two backers launched an unsolicited bid. It was $52 a share to Blackstone’s $48.50. Steve Roth, the bullish—in outlook, demeanor and build—chairman of the massive New York-based investment trust had arrived in the bookish Mr. Gray’s china shop, and it was now a scramble to fend him off.

After three furious weeks of research, negotiations and counteroffers, Mr. Gray prevailed. His offer of $55.50 was 50 cents lower than Mr. Roth’s, but it was all cash, something that the Equity Office board preferred. At $39 billion, the takeover of Equity Office crushed the previous record, the $25 billion buyout of RJR Nabisco by rival Kohlberg Kravis & Roberts 18 years earlier.

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Mr. Gray probably could have used some time out on the open road to relax, even if things were about to get a whole lot busier—he had to sell off at least half of Equity Office’s 563 disparate properties to pay down most of the debt taken out on the deal, lest it consume him. Yet Mr. Zell was not proposing that Mr. Gray start a new hobby. The motorcycle was meant to be a media totem.

“You have to take up motorcycles or something,” Mr. Zell told him, according to a person present. “I ride motorcycles, so they start every story with me riding a motorcycle. You need to find a hook.”

Jon Gray still does not own a motorcycle. He does not race yachts or jump out of airplanes. He is not a force in the art world, nor does he want to run for mayor. He would never be caught dead on reality TV, the World Poker Tour or even CNBC for that matter. His name rarely appears in print, and when it does, it is never attached to a quote. True to form, Mr. Gray declined to comment for this article.

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“One of his qualities is certainly not an excess of pride,” Blackstone co-founder Peter Peterson said in a telephone interview last week. “You’d have to be a psychotherapist, I guess, to understand why he doesn’t need to grandstand at all, given his remarkable track record, but he doesn’t.

Somehow, mostly by choice and his own careful actions, Mr. Gray has managed to remain an anonymous anomaly in two of the most ego-driven industries in New York, real estate and finance. It may very well be the secret to his almost unparalleled success.

Jonathan Gray, Blackstone’s Real Estate Wizard Behind the Curtain