His voice choking, Thomas J. Pritzker looked out at a sea of mourners on Jan. 25 and spoke of the passing of "my best friend, my father, and my partner," Jay A. Pritzker. The death of Pritzker, 76, marks the passing of a 20th century business legend. He helped amass a global, multibillion dollar empire spanning everything from hotels and vast real-estate holdings to low-tech industrial metalbenders and business jets--the bulk of them private and in the hands of his family. One of Pritzker's key legacies may be that his dynasty is not only intact, but well-positioned to continue dealmaking without missing a beat. "Jay was determined to have everything in place, to make the transition to the next generation," says J. Ira Harris, senior adviser to the family.
Members of the intensely private Pritzker clan are not talking. But it's clear that primus inter pares among the next generation of Pritzker cousins is Tom, the 48-year-old chairman of the family's $5 billion Hyatt Corp. unit and Jay's eldest son. Soft-spoken, with a gravely voice that echoes his late father's, Pritzker is a student and collector of Asian art, with a home in Katmandu and an abiding interest in globalizing family interests. He worked in a neighboring office to his father, and, say colleagues, has been intimately involved in all dealmaking for the past two decades.
How will the son put his mark on the empire? Since Jay suffered a stroke in mid-1997, Tom has quietly been asserting more influence, though insiders and outsiders alike say a consensus approach rules. (His three siblings are not actively involved in the business.) In recent years, say colleagues, he has been pushing many of the deals that go beyond hotels and real estate investments. The family's joint venture with Israel Aircraft Industries--Galaxy Aerospace--which is producing a new, mid-priced, long-range business jet first released in January bears much of Tom's handiwork.
Tom shares his father's goal to keep the family jewel, Hyatt, independent and private. Hyatt President Douglas G. Geoga says the younger Pritzker has rebuffed several would-be buyers for the hotel chain over the past decade as the industry has consolidated. And he's now overseeing a $1 billion expansion of hotels around the world. "He sees enormous opportunities in hotel and real estate opportunities overseas, and his interests are accelerating," says Geoga.
Tom's global focus, says Geoga, is behind a recent investment in the Grand Hyatt in Seoul, a hotel the Pritzkers manage. Hyatt will also be adding 12 to 15 hotels in the U.S. over the next two years, and it will make its debut in the Las Vegas area later this year with a resort hotel at Lake Las Vegas.
NEW PATHS. Meantime, Pritzker has played a key role in guiding family investment into newer industries. The Pritzkers now have stakes in a managed-care company, called First Health Group Corp., and in a venture-capital firm that's investing in biotech and life sciences.
Like his father, Tom will not operate on his own. His uncle Robert A. Pritzker, 72, is chairman of Marmon Group, a $6 billion collection of industrial companies that makes everything from medical products and mining equipment to work gloves. Some old Pritzker hands joke that Robert has ended up managing many of the firms that Jay has bought.
Cousin Penny S. Pritzker, 39, heads the expansion of the family's assisted living properties--Classic Residence by Hyatt and Encore Senior Living. A prominent Democratic Party fund-raiser and donor, she also oversees a network of nonhotel real estate ventures that include off-airport parking, land development, apartment management and development, and industrial and retail development. A third cousin, Nicholas J. Pritzker, 53, is the key operative behind Hyatt's development deals, and the driving force behind the family's fairly recent moves into casino gambling operations.
It is, of course, far too early to tell whether the next generation will embrace Jay's bold investment style, one that led him into sometimes controversial buyouts and bankruptcy acquisitions. With dealmakers awash in capital, the next generation of Pritzkers will face oodles of competitors. "They will have to do more pioneering," says Dallas investor Bruce Leadbetter, a partner in Pritzker deals for years. Already, they're showing signs of doing that--and perhaps that's just what Jay intended.