From the foot of his diminutive frame right up to the tip of his cigar, Gerald Ronson is that rarest of animals - a likeable property developer. From the 4th floor of a faceless 70s office block in central London, Ronson presides, with a rod of steel, over a property empire that has risen and fallen and risen again. He is today, beyond any doubt, the most innovative and enigmatic international developer in the leisure industry.

Ronson’s meteoric rise to the dizzy heights of wealth and success from which he would so spectacularly topple in the property crash of the early 1990s is a tale upon which legends are built. He left school at the age of 15 in 1954 to join his father in the family furniture business. A tentative move into small-time residential property development three years later spiralled upwards, until the company, named Heron for Ronson’s father Henry, became a major force in UK development. Factory estates, supermarkets and office blocks sprung up country-wide and, by 1967, the company was active in 7 European countries and no fewer than 52 UK towns and cities.

Ronson was instrumental in the introduction of self-service petrol stations in 1966 and once controlled almost 1,000 across the UK. Now, he spends Saturdays touring his chain of just 50, branded ‘Snax24’ - “a family business, nothing to do with Heron!” he stresses – which turn over £150m a year, mainly thanks to the attached convenience stores.

By the early 1980s, Heron boasted assets in excess of £1.5 billion, was one of the country’s biggest private businesses and Ronson, keen on the trappings of wealth, owned a yacht and a private ‘plane in which to tour his hundreds of developments world-wide. Within 10 years, though, the company was to topple and almost fall under a huge volcano of debt. In 1995, Ronson, the banks paid off but his personal fortune gone, set about a bold programme of refinancing by bringing together some of the world’s wealthiest – Bill Gates, Rupert Murdoch, the trailblazing telecoms genius Craig McCaw, Oracle Corporation’s legendary founder Larry Ellison and others. Insiders estimate that their investments, which give them 75% of the company, have multiplied 5 times – a fitting tribute to the trust placed in Ronson by these business leviathans.

Heron International has constructed over 150 buildings in 9 countries, developed some 10 million square feet of commercial and retail property and over 15,000 residential units in the UK, US and continental Europe. Ronson’s pet project, though, is the well-publicised roll-out of Heron City, vast entertainment, leisure and retail complexes, based on a US concept, encompassing restaurants, family entertainment centre, hotel, nightclubs, bars, cinema, fitness and retail on a single site, with parking for 3,000 cars and offering a unique free programme of live entertainment in a dedicated central arena. A flotation of the leisure side of the business within a few years would seem a logical option and Ronson has, in the past, flagged up the possibility.

Gerald Maurice Ronson is, quite possibly, the last of the old-fashioned property men. His large, traditionally-furnished office is a fug of cigar-smoke, every available surface covered with documents, brochures and family photographs. Citations from the dozens of charities he supports adorn the walls. The antique mahogany of his chairs and desk creak reassuringly.

Ronson’s likeable manner and open, friendly bearing conceals an edge that keeps you at arm’s length, a demeanour reminiscent of the late TV tycoon Lew Grade, with whom he shares a unique ability to use the language, shall we say, creatively. Areas where visitors to an FEC play pool should, he says, be “fractioned off”, leisure centres must be “annervated” to make them viable and, emphasising that Heron intends to be around in leisure for many years, he tells me “we’re not in it for the shortfall! Furthermore, the construction of the second Spanish Heron City involved digging what was, he says proudly, “probably the biggest hole in Barcelona – until we filled it in!”

Ronson, like Grade, is a showman, an arms-waving, all-singing, all-dancing talker-up of his projects. He oozes a passion for the business which is infectious to the extent that you find yourself enthusing along with him. Statistics fly from his tongue and bounce around like tennis balls, but everything he says has the ring of veracity that only comes with insight and a deep devotion to an industry that has occupied over 40 years of his working life.

Heron City complexes opened in Madrid (270,000 sq.ft.) in December 1999 and Stockholm (350,000 sq.ft) in February this year. The aforementioned Barcelona project (400,000 sq.ft.) is due for unveiling in September this year, followed by Valencia, at 450,000 sq.ft., in December. With Heron City Lisbon, the biggest to date at 700,000 sq.ft. now on site and due to launch in 2003, it is clear that the size progression is no coincidence.

“We really require 600,000 square feet of lettable area” Ronson says. “A state-of-the-art multiplex needs an 80,000 square foot box to house 18 screens and provide 4,000 seats plus all the ancillaries like bars, retail, children’s facilities and a separate art cinema. Health and fitness really needs 50,000 square feet and FECs the same. Add to that 30 or so restaurants, nightclub, disco, retail and a new kids concept - which I can’t tell you about yet - and you can see how much space we need!”

Heron City tenants are drawn from the cream of international brands, peppered with a helping of local restaurant and bar operators to provide familiar names to attract indigenous visitors. Leisure operators already in situ include cinema chains AMC, Cinesa and Kinepolis, FEC specialists Planet Bowling and Big Fun, Esporta, Accor Hotels, Burger King, Pizza Hut, Häagen-Dazs and T.G.I. Friday’s, with Top Shop heading the list of core retailers.

Leases for major tenants are for 20 years, structured with annual indexation and turnover-related, open rent reviews every 5 years. Other senior tenants have 10 or 15-year leases, with local operators occupying space on a 5-year basis. Rents vary between £10 to £30 per square foot, depending on location and size of unit

“In the old days” says Ronson, “you wouldn't look at doing a major shopping centre without M & S and C & A - developers would give them space free of charge and make the rent up out of the rest. We don't make a lot out of our major tenants, but its important to have the right operators to bring in others. A lot of major brands would love to come in but they're not prepared to put up a covenant. And we're not prepared to let people come in without one and unless they spend a great deal of money fitting out their units.”

UK-based Esporta operates health & fitness clubs in the Madrid and Stockholm Heron Cities, with further clubs scheduled to open in the Barcelona and Valencia developments, all of which were acquired from Healthland in November 2000. Under the watchful eye of operations director Douglas Waddell and commercial director Jonathan First, a former Healthland executive, membership in Madrid has grown to almost 6,000. Of Ronson, Esporta chief executive Graham Coles says "Gerald is tough, honest and straightforward and continually keeps us on our toes. He is a man of his word and one of the best developers in Europe.” “The Esporta people really impress me” Ronson retorts, “they are true professionals.”

“Not everyone understands at first what Heron City is all about” says Ronson, “but once we open, they see how successful it is and want in. In Madrid, for example, we’re paying premiums to smaller tenants to move out to allow others in, like T.G.I.’s, at higher rent! Once a complex has been open for a year, we can get the rent the space actually warrants.”

Visitor numbers at Madrid are running at some 90,000 people a week - substantially ahead of Heron’s forecasts – each spending around £12 per visit. Much attention has been paid to the environment, as well as the provision of dedicated parking (2,200 spaces in Madrid, 2,500 in Stockholm) and attention to security. “In the UK, you have to park on some scruffy, unswept tarmac-ed land and walk for miles to get to the complex. Our parking areas have music, walking distances are short, they are safe and weather-protected” Ronson says.

The vagaries of the northern European culture presented an interesting challenge at Stockholm. “At weekends, everyone is at home in bed by 12.30am” Ronson says, “whereas in Spain the centre is packed at 1am and open until 6am!” Heron City Stockholm is 78% leased and with two major retail stores opening their doors this summer, Ronson is confident of solid returns.

“We'd like to be building Heron Cities in the UK, but unfortunately we've come second on a couple of major schemes here, like the Shell Centre project on the South Bank” Ronson says with characteristic honesty. “We could have created a great development there, but Lend Lease bid more money - that's how business goes! We also looked at the Selfridges project, where we could have done a 500,000 square foot Heron City - we have the expertise to make sure it's doing well a year after opening, which is the key. That's where they underestimated what we can do - I don't believe they're going to end up at that stage with anything like what they wanted the product to be.”

Ronson also cites the Railtrack land opposite Brent Cross in north London as a development he would have liked to have won. “I think if you had a Heron City to serve the whole of north London, it would be spectacular” he says, “but it went for more money than we were prepared to pay.”

Heron has, and continues to, run the slide-rule over several other opportunities around the UK, including a highly-publicised nose around the Millennium Dome. Ronson will not be drawn on the subject, but says "I'm looking at the Dome wearing my overall property hat, not just for a Heron City - it has interesting possibilities.” And what of Wembley, following the government’s refusal to back development plans for a new stadium? “The FA, the government, Brent council and Wembley plc must decide what it is they want to do. A Heron City on that site as part of everything else would be great, but on its own I would question it. Without seeing the plans, I have no idea why it should cost £700m to build a stadium - to build one for 100,000 people, you don't even need to spend £400m. We have had discussions with Wembley in the past, but then any large chunk of land in London is of interest to us.”

“And then, of course, the whole UK planning process has got more and more difficult and frustrating over the years. Planning needs to become more user-friendly or development will grind to a halt. Developers are treated as people who only want to make money, but we don’t make major returns - this is a very capital-intensive business.”

In the rest of Europe, Ronson has 15 other sites at various stages of planning and acquisition and specifically mentions Belgium, Italy, Germany, France (where a scheme in Lille is awaiting detailed planning consent) and Scandinavia. “It’s very hard to find viable sites. The ideal is about 20 acres, but we can't afford to pay a lot for the land and we need around a million people within a 15-minute drive time. To get that volume of land, you have to go to a local authority and sell them the concept, try to make them understand it.” Widely quoted as planning to have 20 Heron City developments up and running within 5 years, Ronson now freely admits that “the time frame is somewhat ambitious, given the complexities of site acquisition and planning.”

Uniquely among developers, Heron not only manages the centres in-house, but also provides entertainment for visitors in the form of free concerts, children’s entertainment, street theatre and other promotional activities to attract footfall to the centres and, therefore, to tenants’ units. Ronson’s 3^rd (of 4) daughter Nicole is responsible, through her own company, for all entertainment programming within Heron Cities.

Kids’ events are staged two days a week, to get children to nag their parents to visit and the eldest Ronson daughter, Lisa, handles marketing, PR and sponsorship centrally, working with each centre’s on-site team. Local companies sponsor the shows, live music and cultural events, and earnings, along with fees for product launches and other commercial ventures, go back into the pot to provide further entertainment and maintain service charges at realistic levels. “It’s a big, big mistake to ignore centres after they open – it’s not like an office building or a housing development” Ronson says. “You have to have a passion to make it exciting and you must sweat the asset to create visitor volume.”

“There’s not much in the property business that’s exciting” Ronson observes, “but the whole branding pattern, the way the market is moving, is into this kind of product. It’s still in its infancy, but its stimulating and creative and we are at the cutting edge. Now, I don’t want to talk badly of our competition, but certain American companies who were going to set Europe alight with this kind of scheme have packed their bags and gone home. And then there’s the unfortunate situation with THI, which is sad. I don’t mean to sound arrogant, but our developments at Stockholm, Barcelona and Valencia are in a class of their own. The concept started in America, but I think ours are finished better and managed better.”

Ronson is flattered that daughter Nicole has been approached by his competitors to stage entertainment for similar projects in the US but, he says, “she has more than enough to do with Heron City!” A confirmed family man, Ronson has lived for the past 33 years “in the same house with the same wife”, Gail, until recently Chairman of the Jewish Care charity, Trustee of the Royal Opera House and tireless worker, as is Ronson himself, for good causes.

“Always Entertaining” sings the marketing puff for Heron City, an epithet equally applicable to its creator. Tough, yes. Demanding, agreed. But Gerald Ronson is one of that rare breed, a true entrepreneur. In these challenging times, the leisure industry needs him, and his like, more than ever.

ends

What he likes:

Film: Action movies

Hobby: My 3 grandchildren, charity work – but really, my work is my hobby

Car: Mercedes 600 and a twin-turbocharged, 4WD Porsche. I’ve always had an exotic car, like a Ferrari or Lamborghini

TV: Any good drama, “The Vice”, “Casualty”. I might also watch “Blind Date”!

Restaurants: Caprice, The Ivy, Harry’s Bar (for a special occasion)

Holiday: Anywhere quiet. Mauritius was nice last year, and I like Cap Ferrat in the

South of France, but not the over-rated Hotel du Cap – I prefer La Reserve in Beaulieu.