(FORTUNE Magazine) – In the early 1990s, with the economy in a recession and the real estate business in an outright depression, a little-known developer named Christopher Jeffries decided to be different, battling daunting odds to build a big retail and residential complex on New York City's Upper West Side. The project made a quarter of a billion dollars, and now everybody and his brother are putting up big buildings in New York.

So Jeffries is trying something different, again. His Millennium Partners is making a $2 billion bet that rich people in other big cities will be willing to pay a fortune (how does $2.2 million for a four-bedroom apartment sound?) to live like Upper West Siders. "Before, the sign of affluence was that you had enough money to move to the suburbs," Jeffries says. "Now the sign of affluence is that you have enough money to move back into the city."

By the end of next year Millennium plans to have opened high-end condominium buildings--with swank hotels, huge gyms, and in one case a movie complex--in Washington, Boston, and San Francisco. A similar development in Miami should be finished by 2002, and Millennium is considering projects in Atlanta, Toronto, and elsewhere. It's an undertaking that will transform skylines--Millennium's Four Seasons Hotel and Tower in Miami will be the tallest building in Florida, and its Millennium Place in Boston will be the city's first new skyscraper in a decade. But what may be most remarkable about it is Jeffries' belief that he can be that rarest of birds, a developer who doesn't overreach. He says he wants to build in only a few more cities. Then, in seven or eight years, he wants to quit. "We're opportunistic," he says. "We're not building a real estate dynasty."

These plans have earned Jeffries--whose only previous brush with fame was a four-year marriage to Rita Hayworth's daughter, Princess Yasmin Khan (they divorced in 1993; he has since remarried)--recognition in high places. "He's got a strong vision, and he's been able to capture some very good opportunities," says Donald Trump (after pointing out that he, and not Jeffries or anybody else, is New York's biggest developer). More to the point, Millennium has attracted investors George Soros and Goldman Sachs, and business partners Sony, Four Seasons, and Ritz-Carlton.

It's all quite a step up for a lawyer from Michigan who worked himself onto the fringes of the New York real estate scene in the mid-1980s by building low-income housing, then selling the tax abatements and zoning bonuses that the city granted for such good deeds to luxury developers like Trump. His partner in this endeavor was former city development official Philip Aarons, who is now one of the three Millennium Partners. (The third is Philip Lovett, who went to work for Jeffries and Aarons straight out of business school in 1987.) New York's major developers "looked at us as nice kids but not in their league," Aarons recalls. In the late 1980s, though, the pair's zoning bonuses got them a small stake in a high-profile project, a Goldman Sachs-backed plan to build luxury condos just north of Lincoln Center.

When real estate markets began to tank in 1989, that deal fell apart. But Jeffries--to the disbelief of just about everyone else involved--took it upon himself to resurrect it. During 18 months of struggle, he hit upon a unique way to finance big building projects. "He didn't convince any one party that the overall project made sense," says Daniel Neidich, Goldman Sachs' real estate czar. "He really sliced it, and with each slice he convinced each party that this was a proposition that would work." For Sony it was the chance to create a snazzy cinema complex. For Reebok and Sports Club L.A. it was the opportunity to build a premier gym. For J.P. Morgan it was six floors of apartments to house visiting employees and guests. For Goldman it was the top 11 floors of the building, which could later be sold as condos. That left Jeffries with just 21 floors (out of 47) to finance, which he did with help from a group of German insurance companies.

The gamble paid off. Sony's 12-screen Lincoln Square multiplex is the highest-grossing theater complex in the country. The Reebok Sports Club has become the place in New York to sweat and be seen. And the apartments above are now occupied by Howard Stern, Rosie O'Donnell, and many others less famous but just as rich. Only one question remains: Will it play in Miami?

--Justin Fox