A hedge fund manager who suffered massive losses as part of the GameStop frenzy is in the midst of expanding his $ 44 million home in Miami Beach, as GameStop’s founder spoke of his surprise amid the saga.
Gabe Plotkin, who founded Melvin Capital Management in 2014, saw his company lose 53 percent of its value in January – largely due to GameStop negotiations.
Plotkin, worth about $ 300 million, according to Forbes, bet that the shares would decline in value: instead, they skyrocketed, as amateur investors instigated in a Reddit forum began to push the price to up.
His company was worth $ 12.5 billion at the start of the year, The Wall Street Journal reported on Sunday, and now handles more than $ 8 billion.
Gabe Plotkin saw his company, Melvin Capital, lose 53 percent over January
Plotkin bet heavily on the fall in GameStop’s stock price: instead, he shot
Melvin Capital left his position at GameStop after having to raise additional funds, Plotkin confirmed to CNBC last week.
Gary Kusin told CNBC that he watched with interest as his company’s value soared
Gary Kusin, who founded GameStop in the 1980s, told CNBC that it was “a small honor” for investors to target GameStop for their short-term attempt.
“I am much more a spectator than a participant,” he added. – I just bought popcorn.
Gary Kusin’s son Ben was an active member of the Reddit forum, rooting for the company’s spectacular rally.
He told CNBC that his father and brother have been actively watching the drama unfold while GameStop’s shares have soared by 2,000% in the month so far.
“It was the collision of worlds when it happened,” said Ben Kusin.
When Plotkin accepted his losses, he was in the middle of serious work on his Miami property.
Plotkin paid $ 44 million in November for two neighboring Miami homes
The area around Plotkin’s estate is home to Cindy Crawford and Josh Kushner
Plotkin paid $ 44 million for the two adjacent houses at 6342 and 6360 North Bay Road, Miami, in November, revealed The Real Deal 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 said its lawyer is due to appear on the Miami Beach Design Review Board next week.
The plans presented to the city show that Plotkin plans to maintain the mansion at 6360 North Bay Road and replace the next beachfront home with amenity blocks, a new 1,316 square foot cabin, a playground and an open space.
Plotkin married Yaara Bank-Plotkin in 2006, and the two split their time between New York City, where they perform in their Upper East Side synagogue, and Florida.
Plotkin has powerful neighbors in the rich Miami area.
Among those who live nearby are billionaire hedge fund manager Dan Loeb, Cindy Crawford and her 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 SAC Capital in Connecticut in 2006.
He was considered one of the protégés of Cohen’s stars, until he left to start his own New York-based company in 2014.
On January 25, while Melvin was losing money, Cohen’s Point72 Asset Management and another firm, Citadel LLC, injected $ 2.75 billion into Plotkin’s hedge fund.
Citadel hedge fund returns fell three percent in the month, according to The New York Times – about a third of which was caused by a $ 2 billion investment in Melvin about a week ago, from according to two people informed about Citadel’s results.