The Illusion of Alignment: Why I’m Skeptical of Bill Ackman’s Berkshire 2.0
There’s a neighborhood in New York that tells you more about a stock than any investor presentation ever could. It’s where old ambition collides with new capital, where cranes crowd the skyline and a familiar name reappears on development signs: Howard Hughes Holdings.
This company, now trading under the ticker HHH, has become the canvas for Bill Ackman’s latest grand experiment. And it is exactly that — an experiment. One with echoes of Warren Buffett’s early years, but also with complications, side-ventures, and incentive structures that make me pause.
As someone who practices ultra-concentrated, asymmetric investing, I only go in when I see limited downside and a very clear, exponential upside. That’s not a theoretical standard — it’s a practical filter. And when I look at Howard Hughes today, I see both potential and distraction. What I don’t see is the full alignment I demand before I commit capital.
This is the story of a company trying to become Berkshire Hathaway. And this is why I believe it won’t work — at least not in the way Ackman wants you to believe.
From Developer to Compounder? The New HHH
Let’s start with what’s happening on paper.
Howard Hughes Holdings Inc. has long been known as a real estate developer and operator of large-scale, master-planned communities across the U.S. From Summerlin in Nevada to The Woodlands in Texas and the Seaport District in New York, the company has controlled and curated entire ecosystems.
Now, after spinning off its real estate assets into a new REIT structure, Ackman is pitching HHH as a diversified holding company — a blank canvas for future acquisitions, modeled after Berkshire Hathaway. In May 2025, Pershing Square invested $900 million in HHH, buying 9 million shares at $100 each — a premium of nearly 50% to the then-market price.
It’s not just capital; it’s control. Pershing now owns nearly 47% of HHH and controls the narrative. Ryan Israel, Pershing’s long-time partner, now chairs the board. Ackman is repositioning the company to acquire “high-quality durable-growth businesses,” public or private, and to serve as a permanent home for entrepreneurs seeking a long-term partner.
It sounds familiar. But this is where I start to get uncomfortable.
Warren Buffett Had One Job
Warren Buffett’s transformation of Berkshire Hathaway into the greatest compounding machine in history was not built on a multi-company structure, complex financial engineering, or promotional ambition. It was built on focus.
Buffett bought a failing textile company and turned it into his life’s work. He didn’t run three other firms on the side. He didn’t set up a hedge fund, a SPAC, or a closed-end vehicle charging performance fees. He didn’t raise money from institutions and promise returns in quarterly letters.
He lived inside Berkshire.
He owned what his investors owned.
He never charged them a fee.
And he stayed.
Ackman, on the other hand, wants to build a new Berkshire — while still running Pershing Square Capital, Pershing Square Holdings, and whatever future version of Pershing Square Tontine he revives next. He talks about permanent capital, long-term compounding, and shareholder alignment, but his actions show a different framework.
To me, alignment isn’t something you say — it’s something you show.
Complexity is the Enemy
I’ve read the terms of the HHH transaction three times. Each time, I found something else buried in the structure.
Ackman’s $900 million came in via a private placement, priced at a premium, which on the surface seems bullish. But the mechanics of the deal — including the optionality for future capital, the board control, and the underlying governance structure — raise flags.
This isn’t clean. This isn’t simple.
And I’ve learned over the years: if I have to read something four times to understand what I’m buying, I usually stay away.
Complexity is where misalignment hides. It’s where incentives twist. It’s where the illusion of partnership turns into a subtle extraction of value — often legal, rarely ethical.
Berkshire Hathaway never needed a footnote to explain its strategy. Neither should its imitators.
The Promise of 4x to 7x
Ackman claims Howard Hughes can return 4x to 7x over the next 4 to 7 years. That’s a big promise — and one that, in theory, would appeal to investors like me.
I live for asymmetry. I build my portfolio around ultra-concentrated convictions. I don’t need many names. I just need the right ones. If I believed that HHH offered limited downside and true compounding upside, I’d be all in.
But here’s the truth: when Ackman promises something bold, he usually delivers — for himself.
Let’s look at history.
In 2009, General Growth Properties became his turnaround masterpiece. He made a fortune.
In 2012, Herbalife became his crusade. Retail investors followed him in, and most of them lost.
In 2020, Pershing Square Tontine Holdings made headlines as the biggest SPAC in history. It collapsed in regulatory complexity.
In each of these — win or lose — Ackman made money through fees, carried interest, and brand equity.
Retail investors? Not so much.
Ackman is a brilliant capital allocator. But he’s also a brilliant businessman. He knows how to set up structures where he wins — sometimes even when the trade doesn’t.
Buffett, by contrast, never played that game. His incentives were binary. His wealth was tied to Berkshire. He had no other venture. No fee income. No layers.
That’s what alignment looks like.
Ryan Israel and the Future of HHH
Ackman has placed Ryan Israel at the helm of HHH’s board — a quiet but powerful operator inside Pershing Square. Israel is smart, disciplined, and committed. I believe he has the potential to lead, and that HHH could acquire meaningful assets under his guidance.
But again, it’s not the personnel I doubt — it’s the structure.
Is HHH going to be the crown jewel of a Buffett-style holding company? Or is it just another satellite in Ackman’s expanding solar system of vehicles, platforms, and public market narratives?
To be clear: I don’t think HHH is a bad business. In fact, I think it could become a decent one.
But to invest, I need more than “decent.”
I need clarity.
I need focus.
I need alignment.
And most importantly — I need to see a real owner, not just a famous manager.
The Psychology of Overpromising
What makes Ackman so fascinating — and so dangerous — is his ability to persuade. He doesn’t just manage money. He manages belief.
When he says 4x–7x returns are possible, he’s not wrong — mathematically.
But just because something is possible doesn’t mean it’s probable. And just because a hedge fund manager commits capital doesn’t mean he’s committed in the same way you are.
Your capital is fully exposed. His capital earns performance fees, optionality, and visibility — all of which monetize long before you do.
Buffett never had to sell you the dream. His results spoke.
Ackman, in contrast, is always mid-pitch. There’s always a deck, a new vehicle, a new structure.
He’s not building Berkshire. He’s building a brand.
My Investment Lens
I don’t buy stories. I buy outcomes.
My entire strategy is built around identifying companies with undeniable tailwinds, limited downside, and disproportionate upside — ideally 10x returns over 5 to 10 years. I invest ultra-concentrated, meaning I don’t believe in 20-stock diversification. I go deep where conviction is highest.
And most of all, I avoid complexity and misaligned incentives like the plague.
The best opportunities are often painfully simple:
Hims & Hers — a misunderstood digital health compounder
Oscar Health — a vertically integrated insurer with a behavioral moat
LandBridge — an asset-light toll business hidden in plain sight
These businesses don’t require belief.
They require understanding.
And when I do the work, I find alignment — founders with skin in the game, incentives that reward long-term outcomes, and structures that don’t bleed value.
HHH doesn’t pass that test — not yet.
Final Thought
There’s a saying I keep close when evaluating new investments:
“You don’t get rich by backing ambition. You get rich by backing discipline.”
Howard Hughes Holdings may yet become something great. And Bill Ackman may prove his critics wrong — again.
But for now, I’ll watch from the sidelines.
Because unlike Warren Buffett, Bill Ackman hasn’t bet everything on this one thing.
And if he hasn’t, why should I?