A hedge fund manager who suffered massive losses as part of the GameStop frenzy is in the process of expanding his $ 44 million Miami Beach home, it turns out, as GameStop’s founder spoke of his bewilderment amid the saga.
Gabe Plotkin, who founded Melvin Capital Management in 2014, saw his company lose 53 percent of its value in January – largely as a result of the GameStop transactions.
Plotkin, estimated to be worth $ 300 million according to Forbes, had bet the stock would fall in value: instead, they rose, while amateur investors pushing for a Reddit forum began to force the price.
His company was worth $ 12.5 billion at the start of the year, The Wall Street Journal reported Sunday, and now has more than $ 8 billion in management.
Gabe Plotkin has seen his company, Melvin Capital, lose 53 percent over the course of January
Plotkin had bet heavily on a fall in GameStop’s stock price: it rose sharply instead
Melvin Capital has left its position in GameStop after having to raise additional funds, Plotkin confirmed to CNBC last week.
Gary Kusin told CNBC that he had watched with interest as the value of his company rose
Gary Kusin, who founded GameStop in the 1980s, told CNBC it was “a bit of an honor” that investors turned to GameStop for their short squeeze attempt.
‘I am much more of a spectator than a competitor,’ he added. “I just got some popcorn.”
Ben, son of Gary Kusin, was an active member of the Reddit forum and applauded the company’s spectacular rally.
He told CNBC that his father and brother had actively watched the drama, while GameStop stock so far skyrocketed 2,000 percent.
“It was worlds that collided when this happened,” said Ben Kusin.
When Plotkin faced his losses, he was in the midst of hard work on his Miami property.
Plotkin paid $ 44 million for two neighboring Miami homes in November
Cindy Crawford and Josh Kushner live in the area surrounding Plotkin’s estate
Plotkin paid $ 44 million in November for the two adjacent homes at 6342 and 6360 North Bay Road, Miami, The Real Deal revealed last year.
The Portland, Maine-born financier plans to tear down the 1935 house he bought for $ 12 million and replace it with a lighted tennis court.
The Real Deal reported that his attorney is expected to appear before the Miami Beach Design Review Board next week.
Plans filed with the city show Plotkin plans to keep the mansion at 6360 North Bay Road and replace the adjacent waterfront home with amenities, a new 1,316-square-foot cabana, children’s play area and open space .
Plotkin married Yaara Bank-Plotkin in 2006 and the couple split their time between New York City, where they operate in their Upper East Side synagogue, and Florida.
Plotkin has powerful neighbors in the affluent part of Miami.
Among those who live in the area are billionaire hedge fund manager Dan Loeb, Cindy Crawford and husband Rande Gerber, and Karlie Kloss and Josh Kushner.
Plotkin, who graduated in economics from Northwestern University in 2001, worked for several hedge funds before joining Steve Cohen’s Connecticut-based SAC Capital in 2006.
He was considered one of Cohen’s star protégés until he left in 2014 to start his own New York-based company.
On January 25, when Melvin was suffering money, Cohen’s firm Point72 Asset Management and another firm, Citadel LLC, injected $ 2.75 billion into Plotkin’s hedge fund.
Hedge fund returns at Citadel fell three percent this month, according to The New York Times – about a third of that was caused by a $ 2 billion investment it made in Melvin about a week ago, according to two people who knew of Citadel’s results.