Crain's New York Business, July 15, 2024

COSTLY CARE

By Amanda Glodowski

Apopular program that lets people choose and train their own caregivers has grown at an astonishing rate, blowing a multibillion-dollar hole in the state budget and leaving o cials, including Gov. Kathy Hochul, with a big dilemma.

Spending on the Consumer Directed Personal Assistance Program, or CDPAP, has mushroomed by 4,055% since 2014, when it cost the state just $219 million, according to data from the federal Centers for Medicare & Medicaid Services. Spending reached $9.1 billion in 2023.

e growth stems in part from a 2015 relaxation of rules for who quali es for the program that opened the oodgates and made it more vulnerable to fraud. ere are now nearly 300,000 people working in New York’s home health

Brothers feud over property, fashion label

Lawsuit alleges stolen money, tax fraud and a prime retail space driven into default

By Aaron Elstein

Two brothers behind a successful Manhattan real estate and fashion business are accusing each other of fraud and other shenanigans.

Albert Malekan, founder of the high-end Alberto Makali clothing line, is accused in a legal ling by younger brother Michael Malekan of stealing money, ling fraudulent tax returns, and driving a prime SoHo retail property into default.

“For years, Albert operated the family [business] like an unaccountable dictator operating a personal efdom,” Michael Malekan said in his complaint, which asked a judge to strip his brother of control of the family business, including several Manhattan properties. Records show holdings include four mixed-use buildings in SoHo and Midtown estimated to be worth $60 million.

Albert Malekan has counter-

care services sector, according to data from the state Department of Labor. at’s a 173% increase from 2014, when there was an average of about 109,000 workers, a boom fueled mostly by the low-paying, governmentfunded jobs provided by the program.

e largesse has also fueled a cottage industry of as many as 700 middlemen companies that facilitate the program in exchange for a cut of the caregiver’s earnings.

Now, Hochul’s administration is trying to stanch spending. In the coming months, the state will move to reduce the number of middlemen companies to a single contractor. Hochul has said the change will “allow us to start putting controls and guardrails in place for what has historically been a very underregulated program.”

See FEUD on Page 19 See CARE on Page 18

GOTHAM GIGS

Jose Hernandez gets help putting on a shirt from one of his personal assistants, Bakary Sawo. BUCK ENNIS

Alberto Makali, 242 W. 36th St. | BUCK ENNIS

Manhattan lease signings hit their second-highest level ever in June despite record-high rent prices

By Eddie Small

Renters did not see much relief last month to kick o the summer apartment hunting season, with city rents tying or breaking records in June, according to the latest report from Douglas Elliman and Miller Samuel.

e median rent in Manhattan was $4,300 last month, tying its record high for June, the report says. is was at year over year and up slightly from May. e average listing discount, meanwhile, reached a new low of -1.4%, meaning a typical apartment went for more than its initial asking price and indicating that bidding wars are becoming increasingly common.

But the high prices didn't seem to slow down activity, as new Manhattan lease signings hit their secondhighest level on record for June at 6,775, up more than 30% year over year. Listing inventory similarly rose to the third-highest-ever number of apartments for the month at 9,832, up signi cantly month over month and year over year.

Other

boroughs

In Brooklyn, the median rent reached a June record at $3,695, up about 3% month over month and 4% year over year. New lease signings reached their second-highest level on record at 3,760, more than double the amount signed in June 2023 but down 13.4% from May.

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Listing inventory, meanwhile, rose to its second-highest on record for June at 5,435 apartments, up signi cantly month over month and year over year.

e median rent actually dropped compared to May and June 2023 in northwest Queens to reach $3,250, although this was

still the area’s second-highest median rent on record for June. New lease signings rose to their secondhighest level on record at 772, a more than 100% increase year over year but down slightly month over month, while listing inventory reached its second-highest level on record for June at 835 apartments,

also up more than 100% year over year and a 12.5% increase month over month.

Rents are likely to continue rising over the summer barring a sizable drop in mortgage rates that would move more people out of the rental market and into the sales market, said Jonathan Miller,

CEO of Miller Samuel and author of the report.

“Leasing every year peaks in August, so we’re looking at two more months of probably more leasing growth,” he said. “ at means more rent pressure, so my takeaway is that we’re looking at higher rents this summer.”

W.P. Carey President John Park stepping down

Aaron Elstein

e president of real estate investment trust W.P. Carey, John Park, is stepping down after 37 years at the big commercial landlord.

No successor was named and his duties will be assumed by CEO Jason Fox e ective Sept. 30. Manhattan-based W.P. Carey owns 168 million square feet of commercial space across nearly 1,300 properties nationwide.

Park started as an investment analyst and spent his entire career at the rm before rising to president in 2018. He plans to serve as a senior adviser through February and remain trustee for the company that holds the o ce portfolio spun o by W.P. Carey last year.

“He was an internal guy, not the sort put in front of Wall Street, but very accomplished and it looks like a lot of his work was done,” said Evercore ISI analyst James Kammert.

Fox described Park as “an integral member” of the rm and thanked him for his role in shaping the publicly traded rm with a $12 billion market capitalization. W.P. Carey specializes in net-leased properties, which are those for which tenants pay not

just rent but also taxes, utilities and other expenses. Net-leased properties often describe data centers and other critical infrastructure for banks or health care organizations.

Portfolio spinoff

Last year the landlord spun o more than 50 o ce buildings

holding 8 million square feet into an entity called Net Lease O ce Properties. e portfolio’s occupancy rate was 97% at the end of last year.

In recent years Park’s duties included repurchasing real estate portfolios that W.P. Carey had marketed to outside investors. at task was completed in 2022, the company says.

e rm was founded in 1973 and traces its origins to when William Polk Carey leased small refrigerators to classmates at Princeton University, according to the company. In 2003, Arizona State University named its business school for Carey after a $50 million donation. Carey’s grandfather introduced legislation in 1885 that led to the university's founding.

John Park started as an investment analyst and spent his entire career at W.P. Carey before becoming president in 2018.

Kathryn Wylde

Startup’s software digitizes and streamlines affordable housing application process

Christine Wendell founded Pronto Housing in 2020 and envisions it becoming the go-to technology solution

The upstart: Pronto Housing

Applying for a ordable housing in New York City is an infamously time-consuming endeavor. Applicants often spend months sourcing nancial and personal documents to submit to the city to prove eligibility. e process is followed by another lengthy approval period, leaving applicants in limbo during a particularly vulnerable time.

“Even though tens of thousands of people, literally 40,000 households, applied, it took about 18 months to ll units,” recounted Christine Wendell, who used to work in a multifamily asset management rm and oversaw leasing for New York real estate companies. “I was really frustrated by how long it took. I wanted to create the company to solve this problem, given the housing crisis that we’re in.”

for signatures from applicants.

“ e city has a lot of forms, they have 20 di erent attachments, and in any given le, we have to ll out at least a dozen of these,” said Teresa Palmieri, vice president of marketing at Phipps Houses. “Even if it takes only a few minutes per form, we can now do it at the click of a button.”

Wendell co-founded Pronto Housing in 2020 with Chief Operating O cer KC Crosby to digitize a ordable housing applications and provide solutions for people at the mercy of an outdated and paper-driven system.

“You can think of it as TurboTax for a ordable housing,” she said.

In New York City, applicants for a ordable housing must submit all of their documents through the city’s Housing Connect portal. Pronto steps in to help with the qualifying process after the city passes these documents on to property managers. e company has created work ow tools to help sta ers automatically verify nancial documents, calculate household income and ll out eligibility forms from city and state regulatory agencies.

Phipps Houses, a nonpro t developer, owner and manager of a ordable housing in New York City, began using Pronto’s software last year. What used to be a manual process is now fully digital, wherein Pronto generates and completes the agency forms, which can then be easily sent out

e Times Square-based startup has raised nearly $10 million across three seed funding rounds. Pronto rst expanded its services to properties in the Washington, D.C., area, California and Florida, and currently serves properties in 20 states. Pronto says its generated $1 million in annual recurring revenue from its software, which it licenses to property managers.

Jamar Adams, founder and managing principal of the social impact rm Essence Development and former vice president of New York development at Related Companies, decided to invest in Pronto within a few months of using the software to ll over 300 empty a ordable housing units in his development.

“I said, ‘Well, if it’s useful for me, and I’m a practitioner in this space, it should be useful to other practitioners in this space,’” he said. Adams said Pronto’s e ciencies cut the timeline of qualifying a family for move-in by a third thanks to the company’s automated income veri cation and certication process.

The reigning Goliath: Yardi Systems

Yardi Systems was founded in Santa Barbara in 1984 and has risen to become one of the leading real estate property management software platforms in the market. Unlike Pronto, the company doesn’t focus speci cally on a ordable housing. It serves clients in North America, Asia, Europe, Australia and the Middle East. Its estimated revenue in 2023 was $1 billion.

How to conquer the giant

Real estate, in general, is very relationship-oriented,” said Wendell, and one of Pronto’s earlier challenges was getting their rst customer. e company has expanded without a formal sales team by word of mouth through customers, investors, and friends introducing them to other property managers and investors in the sector.

One client, whom Wendell met through an investor, moved from the a ordable housing subsidiary of a large institution to a property management company. “ ey started by using Pronto with their properties in Colorado, and then added properties in four more states,” Wendell said.

Pronto’s software can be set up for “basically any paperwork,” Wendell added. She’s hopeful that 485-X, the new housing tax incentive that replaced 421-a in New York, will eventually add more a ordable units on the market.

The next challenge

Pronto’s next step is to continue building on the e ciencies its created for applicants. is year, it’s focused on streamlining the recerti cation process applicants must submit every year to renew a lease in New York. e goal, as Wendell puts it, is “getting people into housing, keeping them in housing, and making that process just as easy and simple and straightforward as it is for someone applying to a market-rate unit.”

As they grow, Wendell envisions the company to be the “go-to technology solution for all things in a ordable housing management.”

“People nding housing in New York City that is centralized on Housing Connect, but across the country, that’s pretty uncommon,” she said. “It’s very hard to nd a ordable housing, and the user interface and experience of the websites that do have places for a ordable housing listings could be improved.”

Olivia Bensimon is a freelance journalist in New York City who reports on human-centered stories.

Christine Wendell is the founder of Pronto Housing. | BUCK ENNIS

OLIVIA BENSIMON

Hollywood power broker-turned-investor sells

Greenwich Village condo for $23.5 million

By C. J. Hughes

Hollywood power broker-turned-investor Michael Ovitz has unloaded his Greenwich Village apartment two years after a zzled attempt at a quick ip.

The four-bedroom unit, listed in 2022, was once home to musician Jon Bon Jovi $23.5M

e unit, a four-bedroom at the condo 155 W. 11th St., sold for $23.5 million in a deal that went into contract April 18, closed June 25 and appeared in the city register July 5. Ovitz purchased the nearly 4,000-square-foot apartment from rocker Jon Bon Jovi in 2022 for $22 million in an all-cash deal and put it back on the market a few months later at $25 million.

But the unit, No. 14A, struggled

Ovitz purchased the nearly 4,000-squarefoot apartment from rocker Jon Bon Jovi in 2022 for $22 million.

to nd a taker. In the end the apartment traded for a bit more than the price paid by Ovitz, a co-founder of the talent agency CAA and short-lived president of e Walt Disney Co. who in recent years has invested in tech startups.

e buyer of the unit, which features a 39-foot-wide south-facing living room, an eat-in kitchen and a private elevator, used the shell company Bivouac and could not immediately be identi ed. Representing Bivouac in the deal was Midtown-based attorney Sharon Darouvar, who did not return an email for comment. And Raphael De Niro, the Douglas Elliman agent who brokered the deal on behalf of Ovitz, declined to comment.

e buyer paid in cash, based on property records.

In 1975 Ovitz and other William Morris agency alums founded Creative Artists Agency, which represented many of the top actors of the 1980s before expanding into advertising and business consulting, though Ovitz stepped down in 1995 to run Disney. But after a tumultuous tenure, former Disney Chairman Michael Eisner ousted Ovitz two years later.

In 2010 Ovitz founded venture capital rm Broad Beach Ventures, which is based in Los Angeles. A Broad Beach investment from 2021 involved a $25 million nancing round for sales software rm Pathlight, according to Crunchbase.

Ovitz’s romantic partner for about the last decade has been

Jimmy

and fashion entrepreneur Tamara Mellon. e couple’s primary residence is reportedly a 28,000-square-foot mansion in Beverly Hills.

All-cash deal

For his part, Bon Jovi (a CAA client) snapped up No. 14A in 2017 for about $19 million, also in an all-cash deal, according to the register. e seller then was Rudin Management, the developer of the condo, part of the Greenwich Lane complex near Seventh Avenue South on the former site of St. Vin-

cent’s hospital. e Ovitz transaction may not be the only high-pro le recent resale at the condo involving a me-

Hobby Lobby inks 70,716-square-foot Tribeca lease

By Julianne Cuba

e Oklahoma-based arts-andcrafts retailer known for its ownership’s conservative political leanings is coming soon to Manhattan.

Hobby Lobby, which opened its rst chain in the city on Staten Island in March, has now signed one of the largest leases in Manhattan so far this year, inking a deal for 70,716 square feet at 270 Greenwich St. in Tribeca, according to a

Island, where former President Donald Trump received 61.6% of the vote in 2020.

A representative for the faith-focused store, whose core values include “Honoring the Lord in all we do by operating in a manner consistent with Biblical principles,” indicated that the retailer was looking to expand elsewhere across the city and would have “more exciting news soon” after the March opening on Staten Island.

Hobby Lobby has signed one of the largest leases in Manhattan so far this year, inking a deal for space at 270 Greenwich St.

new report from JLL on the state of the retail sector for the second quarter of 2024.

Hobby Lobby has more than two dozen locations across the Empire State but so far only one is currently open in the ve boroughs, at 280 Marsh Ave. on Staten

Hobby Lobby’s Manhattan debut was the highlight of the recent JLL report, released July 3, which shows that, overall, the city’s volatile retail market continues to bounce back as the average asking rent is up this year compared to last, while the availability rate is down, reaching its lowest level on record. e average retail availability rate hit 15.3% last quarter, down from 21% before the pandemic in 2019 and signi cantly lower than the peak at 28% in 2021, according to data from JLL, which tracked several Manhattan

neighborhoods, including Times Square, SoHo and the Meatpacking District.

Asking rent increase

Conversely, as the law of supply and demand goes, the average asking rent, for the most part, has increased 5.9% since last year, from $517 during the second

quarter of 2023 to $548 this year — although it is still below the average prepandemic. Zooming in, the availability rate on Madison Avenue has plummeted to a new low, falling from a whopping 16% this time last year to 5.9% during the rst quarter of 2024 and to 5.3% for the second quarter of this year — breaking its own record again. And along the

lower portion of Fifth Avenue, where the same trend is playing out, the availability rate has similarly dropped to 11.3% during the second quarter of 2024, down from 21% during the same quarter last year and 14.5% during the rst quarter of 2024. e upper part of Fifth Avenue, however, has seen a jump in vacancies — from a record low of 10% during the second quarter of 2023 to 17.1% this year, according to JLL.

Another notable move this quarter was Ikea’s purchase of 80,000 square feet of retail space in the new Extell Development tower going up at 570 Fifth Ave. It’s unclear how much per square foot Hobby Lobby is paying for its new Greenwich Street space at the base of a 35-story luxury building between Murray and Warren streets. A Barnes and Noble bookstore closed in the building earlier this year and a Whole Foods is on the ground oor. Hobby Lobby did not immediately respond to a request for comment, and Sam Martorella of Ripco Real Estate, who is listed as the broker for 270 Greenwich St., declined to comment.

Choo co-founder

dia executive. In late June former Village Voice publisher Peter Barbey listed his penthouse at the building for $32 million.

A rendered image of 155 W. 11th St., Greenwich Village | DOUGLAS ELLIMAN

Michael Ovitz and longtime partner Tamara Mellon at MoMA’s Party in the Garden in June 2022 | GETTY IMAGES

Hobby Lobby has over two dozen locations in New York, but only one is currently open in the city, located on Staten Island. GETTY IMAGES

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Eric Adams is right about this one big issue

Banning

cellphones

in public schools would be a clear-cut win for the embattled mayor

Mayor Eric Adams and Schools Chancellor David Banks may soon ban students from using cellphones in city public schools. It could end up as one of the greatest and easiest education reforms made in recent times — a common-sense move to combat a growing mental health crisis.

Teenagers are addicted to their smartphones. e median teen spends almost ve hours a day on their phone, and some spend as many as 16 hours. Parents have known this for a long time and teachers have found they can’t manage classrooms where students are constantly watching videos, texting friends and scrolling TikTok. Others might be using phones to bully classmates.

throughout the day.

Having smartphone technology in the schools never made much sense. Adams’ predecessor, Bill de Blasio, lifted a Bloomberg-era cellphone ban almost a decade ago, sympathizing with public school parents — he was one himself — who wanted to stay in closer touch with their children. Fears of school shootings drove a certain consensus around cellphone usage: While smartphones, even then, were distracting in classrooms, most parents believed it was more important to be able to call or text their children

But school shootings, as tragic as they are, remain quite rare, especially in New York City. It remains unclear if students possessing smartphones would mitigate them in any fashion. Teachers, administrators, and security sta can still call 911. e new consensus around smartphones is the correct one. Adequate learning cannot take place as long as they are nearby — and especially if they’re included in classwork. Social media itself has proved harmful to young minds, fueling widespread mental health problems among teens. If phones can’t be chased out of homes — too many parents have given in, believing they’re essential for adolescence — they can be easily driven out of schools. It’s the rare policy decision that is popular, bipartisan and already being implemented across the country.

Last year, Republican-run Florida became the rst state to crack down on phones in public schools, banning cellphone use during class time. e law also blocked access to social media for students on the district’s internet. Indiana, another red state, passed a similar law earlier this year. In addition to New York, Pennsylvania, Vermont, Louisiana and Kansas are hoping

to pass what is known as “phonefree schools” legislation.

Joining forces

In December, Tom Cotton, a Republican senator from Arkansas, joined forces with Tim Kaine, the Virginia Democrat, to introduce a bill that would require a federal study on the e ects of cellphone usage in school and the e ects it has on students’ academic achievement and overall mental health.

What was the breaking point?

Phone addiction has certainly skyrocketed enough to make many politicians in both parties care about curtailing it. Students cannot focus on reading, doing math, or writing if they’re constantly on their phones, and serious studies and anecdotal data seem to align: is technology is doing more harm than good. e real impetus might have been the pandemic. In 2020, an inadvertent societal experiment was conducted, moving many previously in-person functions online. Suddenly, there was Zoom school,

remote assignments and copious phone time. Screens were not only a part of learning — they were learning.

And this, quite frankly, was disastrous. We are now only beginning to claw back what was lost in those pandemic years. Banks has promised to detail the potential phone ban in the coming weeks, and it could take e ect in 2025. If it really happens, credit the chancellor and his boss, Mayor Adams, for making this call.

Ross Barkan is a journalist and author in New York City.

Gateway tunnel project lands $6.8B in federal funding

By Caroline Spivack

Regional o cials behind the long-delayed Hudson Tunnel project linking New York and New Jersey have secured a $6.8 billion federal funding agreement to advance the $16.1 billion project that will overhaul a crumbling, century-old rail tunnel and add a new one.

e deal caps Washington'snancial commitment to the Hudson Tunnel project and evades concerns that a possible change in the Oval O ce following November’s presidential election could once again derail construction.

with the project’s completion slated for 2035.

Kris Kolluri, Gateway Development Commission chief executive, described the signed funding agreement at a July 8 news conference as “the point of no return” for the infrastructure project.

“ is time it's real,” added Senate Majority Leader Chuck Schumer. “ e Gateway race was truly a marathon but we laced up, kept the pace and we made it.”

Infrastructure failures

“This time it’s real. The Gateway race was truly a marathon but we laced up, kept the pace and we made it.”

Senate Majority Leader Chuck Schumer

e accord has been in the works for years. With a signed federal funding agreement the Gateway Development Commission, which oversees the project, will begin major construction this month,

Revitalized rail infrastructure under the Hudson is key to the nancial health of the region and the U.S. at large. e Northeast corridor is Amtrak’s busiest with more than 2,200 daily trains stretching from Boston to Washington. It’s also infamous for infrastructure failures that often snarl commutes and delay rail freight.

e sprawling Gateway project includes the construction of a new underwater tunnel along with the replacement of an existing one

that was damaged by Superstorm Sandy in 2012. e price tag for the new tunnel under the Hudson River has climbed to $16.1 billion, an estimate that is 14% higher than a previous 2021 projection. e signed federal funding agreement is the largest and nal tranche of $12 billion in federal grant dollars secured for the tunnel project. Some 70% of the project's cost is being covered by the

Ross Barkan

Banning students from using cellphones in city public schools could end up as one of the greatest and easiest education reforms made in recent times — a common-sense move to combat a growing mental health crisis, writes columnist Ross Barkan. BLOOMBERG

The Gateway project will begin construction this month, with completion slated for 2035. | COURTESY OF GATEWAY PROGRAM

HEALTHCARE

Empowering lives through commitment to health and well-being

Amway transforms communities with a personal touch and innovative health solutions

ANDREW SCHMIDT

Managing Director

Amway North America

Schmidt manages the North America business of the world’s largest directselling company. He’s passionate about entrepreneurship and helping people live better, healthier lives.

For over sixty years, Amway business owners have been more than just providers of nutrition supplements and well-being products, they’ve been promoters of healthy routines and lifestyles for individuals, families and communities. is enduring commitment is driven by a team of over 800 in-house scientists, engineers and technicians spread across over 75 labs, all focused on researching and developing innovative products that enhance lives.

At the heart of this mission is Nutrilite. For more than 90 years, Nutrilite’s rigorous scienti c inquiry and innovative approach has allowed us to continue developing new health supplements that meet quality, safety and e ectiveness standards.

Long before multivitamins became mainstream, Nutrilite introduced Americans to the bene ts of daily health supplements. We stand out as the only global vitamin and dietary supplement brand that grows, harvests and processes plants on our own

certi ed organic farms. Our vertically integrated approach means we oversee every step, from seed to supplement, ensuring that the plants we cultivate on our 6,000 acres of certi ed organic farmland meet unparalleled standards for purity and safety.

For me, the impact of Amway’s innovative products is personal. The Nutrilite Perfect Pack – a combination of vitamins, minerals, plant nutrients and omega 3s –has been part of my daily routine for years. It’s easy to carry and ensures I get the nutritional care my body needs wherever I am. Every morning, I mix Nutrilite Organics Immunity Superfoods, a nutrientrich blend of acerola cherries, elderberries and other superfruits, into my yogurt, setting a healthy tone for the day.

One of the most exciting areas of research at Amway is our study of microbiomes and their impact on the body’s gut health. Later this year, we’re thrilled to introduce Begin, a

breakthrough product developed by our scientists to enhance gut health and help support the body’s natural defense and overall holistic health. Begin is just one example of the many nutritional solutions Amway scientists have pioneered to address speci c health needs.

Amway’s Independent Business Owners (IBOs) play a crucial role in delivering our health and well-being products to consumers across America. Trusted by their customers, our IBOs build meaningful relationships and o er tailored health solutions that help individuals achieve their wellness goals.

In New York alone, over 15,000 small business owners engage with their communities, promoting healthy living habits and partnering with us in community engagement initiatives. Our long-standing partnerships with organizations like Easterseals, support for veterans’ causes, and involvement in backpack and coat drives are just a few examples of how we give back.

What truly sets Amway apart is the direct connection to individuals and their communities. rough enduring relationships and a commitment to continuous care and service, our IBOs provide an enhanced experience to each customer, helping them lead healthier, happier lives.

From promoting mental well-being and community involvement to pioneering sustainable practices globally, Amway and its Independent Business Owners are dedicated to empowering people to extend their health span and live their best lives.

New York’s costly experiment with at-home care needs urgent reevaluation

Albany has a penchant for ambitious programs that, while wellintentioned, veer o into costly misadventures. e latest example is the state’s handling of the Consumer Directed Personal Assistance Program (CDPAP), a program that epitomizes bureaucratic bloat and lack of foresight, leaving taxpayers with a burgeoning nancial load. is matters to New York’s business community which often nds itself sti ed under the weight of one of the nation’s highest tax burdens and a notoriously complex regulatory environment.

Originally designed to empower individuals by allowing them to select and train their caregivers, CDPAP took an unfortunate turn in 2015 when eligibility requirements were loosened. is decision, presumably made with good intentions, opened oodgates to an unsustainable expansion. e result? A staggering increase in program spending, from $219 million in 2014 to an eye-watering $9.1 billion in 2023. Such exponential growth points to a glaring oversight in policymaking.

Subway ads for the program almost

PERSONAL VIEW

seemed to invite abuse by promoting caregiving roles with an emphasis on perks over quali cations. is casual invitation signi cantly undermines the seriousness that caregiving demands.

Remunerating care labor is a step toward gender equity, acknowledging the

economic value of work that has long been taken for granted. However, the execution of this program has been wanting. Gov. Kathy Hochul’s recent step to rein in the program’s costs by reducing the number of intermediary companies from 700 to just one is prudent. Yet, this consolidation

The city must put its money where its mouth is to address dire housing crisis

New York City is in the midst of a dire housing crisis. e vacancy rate for rental housing is at just 1.4 percent, the lowest in 56 years, and 43 percent of New Yorkers are rent-burdened. If we don’t create more housing now, and ensure New Yorkers can afford it, the situation will only continue to get worse.

For New York City to solve its housing a ordability issue, it’s critical to add more supply. However, Mayor Adams’ proposed Executive Budget does not allocate the funding required to deliver desperately needed a ordable housing.

A new analysis by the New York Housing Conference found that the proposed housing capital funding — $2.1 billion in FY25 — is insu cient. Not only would it lead to a 32 percent decrease in the number of a ordable housing units nanced with capital subsidy next year, but it would also reduce by half the amount of new construction and special needs housing compared to recent years.  e funding shortfall would disproportionately impact some of the most vulnerable New Yorkers, including formerly homeless individuals and low-income se-

niors. But the e ects would not stop there.  e Department of Housing Preservation and Development’s (HPD’s) pipeline of a ordable housing projects, which includes both new construction and preservation initiatives, is already strained, with 750 projects awaiting processing and funding. Without adequate capital funding, they would face further delays, increasing costs and prolonging the construction of much-needed a ordable housing.

Given the scale of the housing crisis, New York City must maintain investment in housing programs and adopt a budget to address the backlog of projects. Luckily, the City Council has promised to ght to increase this funding.

But to truly improve the situation, this funding must be coupled with Mayor Adams’ City of Yes for Housing Opportunity plan, which will update our outdated zoning code and enable us to build more housing in every neighborhood, while preserving each neighborhood’s character. It is not large-scale neighborhood rezoning but, rather, tweaks to the zoning code that allow housing to be built more easily, leading to modest density

increases where it matters most.  e City of Yes would give developers a density bonus, called Universal A ordability Preference (UAP), as long as each new unit meets a ordability requirements. Paired with 485-x, the new state tax bene t, UAP could unlock new a ordable units in market-rate buildings and neighborhoods. e proposal would also complement the state’s adjustments to oor area ratio (FAR) and its tax bene t for o ce-to-residential conversions, by allowing buildings built before 1991 to convert.

Advancing the city’s goal

ese two components of the City of Yes — combined with the legalization of accessory dwelling units, the removal of parking minimum requirements, provisions for transit-oriented development, and more — would advance the city’s goal of producing 500,000 new units of housing throughout the ve boroughs.

But the City of Yes cannot solve our crisis alone. We must maintain our commitment to funding a ordable housing. is is the wrong time for the city to let o the gas and decrease a ordable housing production. at’s why, in addition to urging Community Boards and the New York City Council to support the City of

There was a staggering increase in program spending, from $219 million in 2014 to an eye-watering $9.1 billion in 2023.

raises concerns about service disruption and administrative chaos, reminiscent of Massachusetts’ troubled experience, which resulted in delayed payments and caregiver shortages.

Streamlining should not mean steamrolling. e issues at hand — the program’s ballooning costs and susceptibility to fraud — will likely demand further attention and reform.

e governor should stand rm on the solid ground of sustainable and equitable policy-making. If not, New Yorkers should be ready to hold her accountable for the mismanagement of a program that could have revolutionized caregiving, but is instead mired in controversy and ine ciency.

Yes for Housing Opportunity — allowing for more housing in every neighborhood — the New York Housing Conference calls on Mayor Adams to show his commitment to a ordable housing by adding the funding necessary to maintain production and make progress on the a ordable housing pipeline.

e New York City Council has been a strong advocate for housing resources under Speaker Adams, and we encourage her to hold the line. Now, it’s Mayor Adams' turn to increase HPD’s capital budget by $1 billion in FY25 to maintain current affordable housing production levels and address the substantial pipeline backlog. Hundreds of thousands of rentburdened New Yorkers are counting on us to improve the current housing crisis. It’s time for the city to put its money where its mouth is and stop standing in the way of an a ordable home.

Subway ads promoting Consumer Directed Personal Assistance Program caregiver roles put an emphasis on perks over quali cations. CORY SCHOUTEN

Rachel Fee is the executive director of the New York Housing

The mayor’s City of Yes plan cannot solve our crisis alone, writes New York Housing Conference Executive Director Rachel Fee. BLOOMBERG

PERSONAL VIEW

Now is the time for big

thinking about the Big Apple’s future

The math of real estate is simple, but immutable.

You cannot nance a project that pencils out at a loss. If a developer can’t make the math add up, the project won’t happen. Construction costs, timelines for zoning and permitting, labor contracts and taxes are part of the equation everywhere, of course. In New York, however, these are anything but straightforward calculations, with complexity layered upon complexity.

Let’s start with zoning.

But even when fully entitled, developers are still left with the one big question: What are the taxes? You can’t know until you get your temporary certi cate of occupancy, and it will be another three years until there is certainty.

Simply put, we make it too hard to get big real estate projects done under the fallacy that if a developer receives a discretionary tax program, somehow the city is losing money. Not true. Look at the New York Times headquarters. Prior to building this 1.6-million-sq.-ft. tower, there were 10 smaller buildings on the site, collectively paying $900,000 in taxes per year. In its rst year under the generous discretionary tax package the Times received, the new building paid $13.5 million.

Tighe is the CEO of the New York Tri-State Region at CBRE.

In New York, if you’re building an o ce building of, say, 1.2 million sq. ft. (average for Midtown), your taxes are likely to be between $40 million and $50 million a year. And if you’re building rental residential, taxes will eat up one-third of your e ective gross income.

PERSONAL VIEW

the wake of that attack, we had a real coming together of public policy, political support and great planning.

Nevertheless, there’s an impulse to be punitive toward development, as if it’s an activity without risk and somehow every developer is going to hit the jackpot.

e good news is that we know we’re capable of doing big things.

Just look at what we achieved downtown in the aftermath of 9/11, which today is a market reimagined following two-plus decades of public and private investment, grit and hard work.

We didn’t get here by thinking small. In

And today, we’re on track to hit nearly 70,000 residents by 2025, up from 13,000 in 2000, and over 12 million sq. ft. of new, modern o ce space. is is what you can actually do when you bring forces together — and focus those forces on doing big things.

A real coming together, again

Now we have to do it again, only bigger — not as a result of a terrorist attack but of a terrible need to house people at all economic levels, to deal with New Yorkers who have mental health issues, to meaningfully address the migrant crisis, to address the misalignment between o ce supply and demand.

We have to do it again to build for our

Albany lawmakers get it right on protecting consumers

In the last days of the state legislative session, a majority of Albany lawmakers stood with New York families and defended their wallets by ensuring the misnamed “Packaging Reduction and Recycling Infrastructure Act” did not make it to Gov. Kathy Hochul’s desk.

Oftentimes, lawmakers are praised for passing legislation. Today, we should applaud them for stopping it.

New Yorkers can rest assured that access to their favorite foods, drinks, and goods will not be compromised due to new, overbearing government regulations. Had this bill been passed and signed, prices would have skyrocketed, products would have come o the shelves, and technology that supports recycling would have been banned. While the broader goal may have been admirable because all sides support sustainability, the proposed approach would have had more unintended negative consequences than bene ts. Take prices, for example. New York families are already being squeezed out of every nickel and dime just to get by and face the highest tax burden in the country, leading to many residents and businesses eeing the state. is bill would

have increased costs even further at a time when in ation is still at record highs, hurting every family’s bottom line.

Mike Durant the president and CEO of the Food Industry Alliance of

New York.  John Hewitt is the vice president of packaging sustainability and head of state a airs with the Consumer Brands Association.

It would have been harmful to job creators had this bill come to pass. Some of the most well-known companies with facilities in New York would be forced to reduce their supply or, worse, pull out of the state due to overbearing new packaging requirements. Farmers would have been penalized and hit with higher fees that would have inevitably trickled down to the consumer. Imagine going down the grocery aisle and realizing your favorite foods are no longer sold in the Empire State. Prices would skyrocket for other brands because of fewer choices.

What’s just as devastating is the nancial burden that would have disproportionately impacted disadvantaged families who rely on SNAP, as the misnamed bill would effectively ban access to food sold in exible or convenience packaging — common in many SNAP goods.

We all want to build a more sustainable future. e consumer packaged goods (CPG) industry has already, and voluntarily, been investing in more sustainable

products and setting ambitious targets to better the health of our planet. Our goal is to create a circular economy for packaging. However, the current U.S. system struggles to create the volume of quality recycled material needed to ful ll recycled content goals.

future. And it’s going to take an apolitical approach to get our policies right.

We should champion the initiatives being led by Mayor Adams, including streamlining approval processes, bolstering neighborhood retail and developing more a ordable housing. And let’s build on the alignment between the mayor and governor on the “New” New York Panel and its recommended initiatives across a range of needs.

We know what works. We need to have the will to do it. And we need to get our public o cials to understand that they can dream all they want for a new and better New York, but if the numbers don’t work, it’s all just noise.

Material-to-material molecular recycling is a key piece of the solution. is technology enables plastic waste to be processed back into virgin-grade durable, re llable, or reusable applications — and allows our companies to create better packaging solutions with a lower environmental impact. Yet, this bill would have banned advanced recycling, which would hinder these packaging innovations and stunt the incredible progress we’ve made toward a more circular economy.

New government regulations, even if well-intentioned, are often unnecessary and prohibit companies from being able to create products successfully and do business, especially in New York. At least 158 companies have already left the state

because of burdensome regulations — we don’t need to lose any more. It is crucial for policymakers to carefully consider the economic implications of their proposals and strive for a balanced solution that bene ts all stakeholders.

e CPG industry stands ready to work with Albany lawmakers and those across the country to build a more sustainable and circular economy that protects consumers, spurs innovation and facilitates job growth. Laws for the sake of legislating come at a price, and New Yorkers deserve better.

New York Assembly: thank you for standing up for New Yorkers. ere’s a better way to support sustainability without hurting consumers.

Mary Ann

The Packaging Reduction and Recycling Infrastructure Act would have had more unintended negative consequences than bene ts, write Mike Durrant of the Food Industry Alliance of New York and John Hewitt of the Consumer Brands Association.

| BLOOMBERG

It’s going to take an apolitical approach to get our real estate policies right, writes Mary Ann Tighe of CBRE. BLOOMBERG

PEOPLE ON THE MOVE

ACCOUNTING

Forvis Mazarss

Forvis Mazars, a leading global professional services network, recently appointed Ryan Reiff as New York Metro managing partner. In this newly expanded role, Ryan is responsible for setting the strategic direction of the practice, managing of ce operations, and leading a team of approximately 800 professionals throughout Manhattan, Long Island, New Jersey, and Philadelphia. Ryan has been with the rm for 20 years and has served clients in an array of industries.

ACCOUNTING

Forvis Mazars

BUILDING CONSULTING

Cumming Group

Gavin A. Middleton has assumed the role of Chief Operating Of cer (COO) for Cumming Group’s North American business. Middleton’s journey with Cumming Group began in July 2018, following the merger with Lehrer, LLC. Since January 2023, Middleton has excelled in his dual roles as CEO of Lehrer Cumming and EVP of Cumming Group’s US Project Management division, showcasing his exemplary leadership abilities and strategic acumen. Middleton is a respected leader in the design and construction industry with a 30-year career managing complex programs on behalf of owners, developers, and institutions across the United States, Canada, Europe, and the Caribbean.

To place your listing, visit www.crainsnewyork.com/people-on-the-move or, for more information, contact Debora Stein at 917.226.5470 / dstein@crain.com

COMMERCIAL REAL ESTATE

Connect Creative

Connect Creative, a leading creative services agency for the commercial real estate sector, expanded its New York City presence with the appointment of Parke Chapman as Vice President of its Eastern region. Chapman, based in NY, brings 25 years of experience in communications and reporting. He will drive business development and foster client relationships in the NYC CRE market. Chapman previously served at Rubenstein and The Marino Organization.

PROFESSIONAL SERVICES

Lucas

PROFESSIONAL SERVICES

EisnerAmper

Forvis Mazars, a leading global professional services network, recently announced it appointed Carlos Martins as an assistant managing partner for its New York of ce, supporting New York Metro managing partner Ryan Reiff. Based in New York City, Carlos is also the market industry leader for the rm’s Construction & Real Estate practice. He has more than 15 years of experience providing audit, advisory and accounting services to domestic and international companies in the real estate sector.

BUILDING CONSULTING

Cumming Group

Christine Mosholder has been appointed Chief Development Of cer for Cumming Group’s North American business, following her 2021 merger of Fort Point Project Management, which she co-founded in 2000. In this newly created role, Mosholder will spearhead development initiatives, support team growth and integration of acquired businesses, and bolster community engagement efforts. In her previous role as SVP, Mosholder expanded the rm’s presence in New England and the Mid-Atlantic, and their national portfolio in life science, for the largest pure-play project management rm in North America. Mosholder’s leadership extends beyond professional achievements as she is the founder of two non-pro t organizations, WWIRE and The Furniture Trust.

HEALTH CARE

Episcopal Health Services

Episcopal Health Services (EHS) welcomes Dr. Jameela Yusuff, MD, MPH, as Senior Vice President & Chief Medical Of cer and Keisha-Ann Wisdom, DHA, MBA, BSN, RN, NEA-BC, as Senior Vice President of Patient Services and Chief Nursing Of cer.

Dr. Yusuff brings over 20 years of experience to EHS. She will develop clinical strategies, establish benchmarks, and monitor progress in clinical care, recruitment, business development, service delivery, nance, workforce planning, and team development.

Dr. Wisdom has more than 25 years of healthcare experience. She will lead the Nursing division, providing executive leadership, strategic direction, and ensuring the delivery of optimal and compassionate nursing care to patients.

Jane Lyons joins Jackson Lucas, a retained executive search rm specializing in investment banking, asset management & alternatives, real estate, technology, legal, and human resources. With over 30 years in executive search and organizational consulting, Jane has helped leading real estate rms recruit top executives and entire teams. She mentors young professionals in real estate, regularly speaking at Columbia and NYU, and advises clients on retaining top performers. Jane is a past president of CREW New York, sits on the Urban Land Institute’s Retail Council, and is a member of the Pension Real Estate Association and Mortgage Bankers Association.

Michael Braverman, Partner, has been named EisnerAmper’s National Leader of Transaction Advisory Services (“TAS”) and Leader of Forensic, Litigation, and Valuation Services (“FLVS”) at the rm’s NY of ce. With 35-plus years’ experience, Michael specializes in transactional consulting, litigation services, arbitration, auditing, complex accounting, and buyand sell-side M&A transaction diligence. He primarily advises law rms, private equity rms, and public and private entities.

PROFESSIONAL SERVICES

Weaver

PROFESSIONAL SERVICES

Jackson Lucas

Steven Zimmerman joins Jackson Lucas as a Partner, bringing over ten years of commercial real estate investment sales experience working at Eastern Consolidated and over ten years of executive search experience as a Partner at Rhodes Associates and Founder of Direct Connect Staf ng. Steven graduated cum laude from Skidmore College with a BA in Psychology and lives in Westchester, NY with his wife and two children.

Michael Lipsett, CPA, has been promoted to Partner in Investment Fund Audit Services at Weaver. He has more than 11 years of public accounting experience where he focuses on audit and other assurance services for clients across the investment management industry. He has deep experience working on audits for venture capital, hedge, private equity and public mutual funds, as well as digital asset and fund-of-fund clients.

PROFESSIONAL SERVICES

Jackson Lucas

Edward “Tripp” Lyons joins Jackson Lucas as a Managing Director, bringing nearly four years in retained executive search and over eight years of CRE transactional experience in capital markets, nancing, and investment sales. He previously worked at Iron Hound Management, Ackman-Ziff, and Eastern Consolidated, closing approximately $250M in debt and equity assignments. Tripp focuses on business development, search execution, and organizational consulting. He graduated from Gettysburg College with a BA in History.

PROFESSIONAL SERVICES

Weaver

Matthew Slack, CPA, has been promoted to Partner in Audit Services at Weaver. He has more than 12 years of public accounting experience with a focus on the real estate and infrastructure sectors, serving public and private companies as well as investment funds. He delivers audit and attest services under GAAP and IFRS accounting standards and has experience providing SEC lers with services related to annual and quarterly reporting, and debt and equity issuances.

Yusuff Wisdom

Jackson

COMMERCIAL PROPERTY MANAGERS CRAIN’S LIST

345 Hudson St. New York,NY10014

GFP REAL ESTATE

515 Madison Ave. New York,NY10022

212-894-7000 vno.com

StevenRoth, chairman, chief executive; MichaelFranco, president, chief nancial of cer

212-372-2000 nmrk.com

THE DURST ORGANIZATION 1155 Avenue of the Americas

New York,NY10036

RUDIN 345 Park Ave. New York,NY10154

212-230-2300 hines.com

rxr.com

212-609-8000 gfpre.com

212-490-0666 silversteinproperties.com

212-257-6600 durst.org

212-407-2400 rudin.com

DavidFalk, president New York tri-state region; BarryGosin, chief executive; JamesKuhn, president, head of investor services

JasonAlderman, senior managing director, city head, New York; Sarah Hawkins, chief executive, East region

, chairman, chief executive; MichaelMaturo, president, chief nancial of cer

EricGural, co-chief executive, principal; JeffreyGural, chairman, principal; BrianSteinwurtzel, co-chief executive, principal

LarrySilverstein, chairman; Lisa Silverstein, chief executive; Tal Kerret, president

DouglasDurst, chairman; Jonathan Durst, president

Samantha Rudin Earls, co-chief executive; MichaelRudin, co-chief executive; NeilGupta, president, chief investment of cer; EricRudin, co-executive chairman; William Rudin, co-executive chairman

450GroupM, Droga, Moody's, Port Authority of New York and New Jersey

1,400Bank of America, NASDAQ, TikTok, Bank of Montreal, Global Relay, H&M

296Blackstone, NFL, Hughes Hubbard & Reed, Touro University

Shearman, Weil Gotshal & Manges, Kirkland & Ellis, Estée Lauder's Aramis

633LinkedIn, Flagstar Bank, Centric Brands, PVH Corp.

Crain'sNewYorkBusiness usesstaffresearch,extensivesurveysandthemostcurrentreferencesavailabletoproduceitslists,butthereisnoguaranteethattheselistingsarecomplete.Toqualifyforthis list,companiesmustmanagecommercialpropertyinatleastoneofthe veboroughsofNewYorkCity.Commercialsquarefootageandthird-partysquarefootagehavebeenrounded,butrankingsare basedonunroundednumbers.Executivesmayhaveadditionaltitles.All guresareasofSept.30ofthegivenyear.n/d-Notdisclosed. 1. Full-timeandfull-time-equivalentonly,includingunionmembers and administrative employees. 2. Property management gures as of March 31, 2024. 3. Formerly known as Boston Properties Inc.

Fulbright, Morgan

Valley Health’s new CEO on sustaining growth

Dr. Robert Brenner came to Valley Health System in 2015 hoping that one day he could lead the system. This July, he reached his goal, assuming the role of chief executive of cer of the health system, which includes a hospital, a home care service and a primary medical practice.

Brenner talked with Crain’s about his vision for the future and how to keep building on the system’s strong momentum following the opening of its new $868 million hospital in Paramus. This interview was edited for length and clarity.

Tell us about some of Valley Health’s new initiatives and strategies for growth. We can’t be everything to everybody, so we have created partnerships to complement what we have here and meet the needs of our community. For instance, we have many physicians from Mount Sinai to practice here within pediatric specialties. We also have a comprehensive care center in collaboration with them. In cardiovascular, we work with the Cleveland Clinic. In terms of behavioral health and meeting the needs of the community, we are doing that with Christian Health.

en, we are on our path to being an academic medical center. We have our rst residents who are now here on their second day, but we have a graduate medical education program that we brought to Valley in collaboration with Mount Sinai Icahn School of Medicine. We plan on building several programs.

ird, we have expanded our network in a very big way, adding or renovating 250,000 square feet this last year alone. We have a large medical arts building adjacent to the new hospital, which is state of the art, and we moved and consolidated di erent specialties together. For example, we’re opening a new cardiovascular service center, and in that, you’ll have the surgeons and the interventional cardiologists, and all of the di erent specialties so they can pop across the hallway and talk

By | Amanda Glodowski

specialties. We need to make sure their schedules are open for booking, and that has helped us a lot with access, but we can take it further.

We need to further propagate mobile scheduling and get our patients to utilize that to gain access. We do have navigators in some specialties, but we may need to increase that.

The Valley Hospital’s patient revenue grew by nearly 9% from 2022 to 2023. Where does that growth stem from?

“If you look at past mergers, quality has not increased. The only thing that has consistently increased, with a merger, is the cost of care in that organization.”

about patients that they need to collaborate on.

How will you expand access to care?

It’s not just an IT problem, it’s a complex issue. Let’s say we have few physicians in a particular specialty, if there’s huge demand, we need to make sure we are hiring more of those

We have expanded our geography. I also believe that we have expanded the number of di erent specialties and care that we can deliver. In cardiovascular, we added surgeons, we added procedures you cannot get in other places. We hired an interventionist a couple of years ago who could do six procedures that no one else in New Jersey was doing. We were the third health system in the country to do pulsed- eld ablation for atrial brillation.

Our volume since the move to the new hospital is expanding at exponential rates. Our volume is in general up 10%, and in some

specialties is up much more. e emergency room in our Ridgewood campus was seeing under 200 patients [per day]. We’re now averaging 225 patients per day, and some days we’re up in the 260s. We have almost doubled the number of rooms in the emergency room, and it is busy.

What’s that increase from?

We’re pulling from other ZIP codes. We did get the “new and shiny” impact of the move. We were told we wouldn’t see the e ect of the new hospital for eight to 12 months. But the second or third day out, we were seeing increased volume. We’re in a location more accessible to patients. We were nestled in Ridgewood, now we’re at the crossroads of several highways.

Valley Health has managed to avoid the trend of hospital consolidation. Why not merge with one of the bigger systems? You would do a merger for several reasons. One is that you have issues on the nancial and capital side. We don’t have that. And, if you look at past mergers, quality has not increased. e only thing that has consistently increased, with a merger, is the cost of care in that organization. So we have no reason to do it. rough our partnerships and our own health care, we’re able to accomplish what we need to.

On the ip side of that, have you thought about acquiring other facilities?

I don’t think we’re in the market to acquire another health system. ose thoughts always go through strategic decisionmaking, but that’s not something we are considering at this time.

What do you want your legacy to be in this role? is is my last stop in my profession. I want to make an impact on the organization, and I want this organization to grow. I want to see graduate medical education become a prominent part of our organization. I want to make sure we are stable with the [economic] headwinds, and I want to make sure that we grow the leadership in the organization so we can be known for our access and ability to navigate patients and highquality, safe care.

Extreme heat threatens city’s movable bridges

Extreme heat forced the metal of the ird Avenue Bridge linking Manhattan and the Bronx to expand and become stuck for several hours July 8 — a phenomenon that increasingly threatens to disrupt tra c across the city’s movable bridges as heat waves become more frequent and intense due to a warming planet.

e ird Avenue Bridge rotated to let a vessel pass on the Harlem River at roughly 2:45 p.m. July 8, the city’s hottest day of the year with the temperature spiking to 95 degrees, but was unable to swing to a closed position thanks to an expansion of the overheated steel, said FDNY spokesman Jim Long.

Marine crews with the Fire Department had to hose down the metal and hydraulic system of the century-old bridge to cool it down enough to get the structure moving again; the open bridge snarled trafc until 6:30 p.m., said Long. e situation is a stark example of the less obvious consequences of a changing climate and gives New Yorkers a taste of future disruptions to expect across the city’s two dozen movable bridges as sweltering heat becomes more common.

“ ese extreme events are going to, increasingly, interrupt our daily lives,” said Debra Laefer, a professor at New York University’s Tandon School of Engineering.

“When we design bridges, we design for a certain temperature range, and now, all of a sudden, areas are getting sustained heat like they’ve never had before.”

e city Department of Transportation oversees 24 movable bridges throughout the ve boroughs. ose include two retractile bridges, seven swing bridges — like the ird Avenue Bridge — four lift bridges and 11 drawbridge crossings. e spans run the gamut of linking the boroughs over major waterways, such as the East River, to smaller canals and creeks.

e DOT acknowledged that the city’s movable bridges occasionally have di culties opening or closing due to steel expansion.

DOT bridge crews regularly inspect the gaps in movable bridges to ensure there is enough clear-

ance to open and close them; when there is not enough space, typically, the Coast Guard is notied that a bridge is out of service and that vessels must nd an alternate route, according to DOT spokesman Vincent Barone.

Laefer said bridge retro ts to mitigate heat expansion are theoretically possible, but addressing the problem is a costly, laborious undertaking that would require rejiggering entire structures. “ at’s really the bigger problem: the money and the time it takes, which all takes away from maintenance and other things,” Laefer added. “It’s not something that you can just send one guy out with a grinder and it’s going to be xed in an afternoon. So, I think we are just seeing the beginning of this.”

Caroline Spivack

The Third Avenue Bridge is a swing bridge that can be rotated opened due to two breaks, one shown here, in the bridge. BUCK ENNIS

Robert Brenner, M.D., president and CEO, Valley Health System COURTESY OF VALLEY HEALTH SYSTEM

Times Square to get 3-story cannabis shop this fall

By Julianne Cuba

A massive cannabis retailer is coming to Times Square this fall, according to one of the business partners involved in the new venture.

James Mallios, an attorney who now specializes in the hospitality and real estate industries and who serves as managing partner of restaurants on Long Island and in the city, is teaming up with William Norgard, a U.S. Army veteran who sued the state — and won — over the eligibility requirements for its much-maligned rollout of

“We’re

Norgard, along with three other veteran plainti s, had accused the state of favoring applicants who had gone through the criminal-justice system for a cannabis-related o ense over disabled veterans like himself. e case was settled last year, and Norgard and his business partners were granted a provisional license from the state in order to open at the Seventh Avenue location, which also goes by 30 Times Square, according to Mallios and state records.

“We’re excited to, in the fall, unveil what is possibly the largest retail cannabis store on the eastern seaboard, in the middle of arguably one of the most visited places on the planet,” said Mallios.

excited to, in the fall, unveil what is possibly the largest retail cannabis store on the eastern seaboard, in the middle of arguably one of the most visited places on the planet.”

legal weed shops, to open up a state-sanctioned, 3-story cannabis retail experience in the entirety of the building at 719 Seventh Ave.

Norgard and Mallios, together with others who remain unidenti ed, signed a 20-year lease for the roughly 10,000-squarefoot space under the limited liability company 2 Forest Park Lane, records show, whose address is linked to a Mykonos-inspired restaurant in the Hamptons called Calissa. Mallios serves as the managing partner of both Calissa and Amali, a Mediter-

ranean-inspired restaurant on the Upper East Side.

e building’s landlord, whom Mallios declined to name, bought the property in the heart of Times Square from SL Green for $32.4 million under the limited liability company AMWB 719, which appears tied to Miami-based rm Boich Investment Group and former SL Green President Andrew Mathias, according to a June deed that appeared in the city register recently. SL Green purchased the original Seventh Avenue building, at the corner of West 48th Street, for $41.1 million in 2014, records show.

Unique experience

Mallios said he and Norgard are in the process of obtaining a trademarked name for their new enterprise, which he says will o er a unique experience on each oor and di er greatly from the many other — and what he called “typical” — legal dispensaries currently in operation throughout the city, including one just around the corner on Eighth Avenue. Mallios also described the new business as “luxury” but declined to expand further on what exactly that means for the shop.

“We’re very excited about the look and feel of the store,” said

Mallios, who declined to comment on the details of the lease agreement. SL Green declined to comment on the sale of the building, citing a “quiet period” leading up to its earnings call. And neither the Dallas-based family investment rm VerCap Management, which provided $23 million in nancing, according to city records, nor Boich Investment Group responded to requests for comment by press time.

Tourists have once again been ocking to Times Square as the

city continues to recover from the pandemic, even as the occupancy rate of its commercial real estate sector has taken a bit of a dip in the last year, according to the latest data collected by the Times Square Alliance. In May of this year, 243,352 pedestrians visited the area daily — down slightly from the 306,523 who visited during that month last year — and its occupancy rate dropped from 82.3% in 2023 to 76.4% so far this year. And according to the report, 84% of its storefronts were open for business in May 2023.

James Mallios, attorney who is a business partner in a planned 3-story cannabis store

30 Times Square | BUCK ENNIS

City’s Buildings Department, facing challenges with new policy mandates, turns to tech sector for help

Nick Garber

A business-aligned group that has pushed tech solutions for government problems is now turning its attention to New York City’s Buildings Department, which nds itself at the center of multiple major policy issues.

e Partnership for New York City, through its investment arm, already runs two “Innovation Labs” where technology companies compete annually to o er ideas to local government agencies: the Metropolitan Transportation Authority starting in 2018, and the Department of Environmental Protection since 2023. e programs have had a real impact

sponsibilities: enforcing the City of Yes rules that relaxed zoning distinctions, implementing the sweeping climate law Local Law 97, and doing new rounds of structural inspections in the wake of two building collapses last year.

All the new mandates have “put more demand on DOB sta without any real upgrade in the tools that they have to deal with these new challenges and expanded responsibilities,” said Kathryn Wylde, president of the Partnership, in an interview.

“The Buildings Tech Lab represents a signi cant step forward in our commitment to harnessing cutting-edge technology to enhance our regulatory functions.”

James Oddo, Buildings commissioner

— the MTA, for example, says it has saved millions of dollars by using a software to redesign bus routes that it rst tested through the Transit Tech Lab.

Now, city leaders have agreed to make the Department of Buildings the latest guinea pig, according to details shared with Crain’s. e department hopes to get help from the tech sector as it prepares to take on a wide range of new re-

Buildings Commissioner James Oddo has repeatedly expressed a desire to bring his department into the 21st century technologically. e DOB approached the Partnership in 2022 to pitch the Tech Lab after Deputy Mayor for Operations Meera Joshi told Oddo about the existing MTA and DEP programs, said Stacey Matlen, senior vice president at the Partnership Fund for New York City — the investment fund overseeing the competition.

e inaugural Buildings Tech Lab will ask companies to apply by Sept. 20 with ideas that fall under two categories: process management, such as expediting building inspections and code reviews; and data utilization, using existing data to automate more work. ose categories were chosen after meetings with 30 DOB o cials across eight bureaus that identi ed the agency’s biggest needs, Matlen said.

e handful of winners that emerge from the DOB competition will each be given an eightweek “proof of concept” phase where they will workshop their proposals with the department, followed by a yearlong pilot deployment on a larger scale. Companies get no payment from DOB or the Partnership Fund for participating, but a successful pilot gives them a shot at scaling up to a fulledged contract — plus the industry credibility that comes with demonstrating a successful product in the country’s biggest city.

Identifying buildings at risk

Among the issues that Buildings Tech Lab applicants may tackle is the new mandate handed down by

the City Council last month that requires DOB to use predictive technology to identify buildings that are at risk of collapse.

Companies might also turn their attention to sidewalk sheds, as DOB recently began an indepth study of its facade inspection rules as part of Mayor Eric Adams’ e ort to take down unsightly sca olding. e companies accepted into the incubator will be early- and growth-stage.

Success stories from the existing Tech Labs include Knaq, which produces devices that monitor elevators, escalators and moving walkways. Since winning a 2020 Transit Tech Lab competition, Knaq has rapidly scaled up its partnership with the Port Authori-

ty of New York and New Jersey, which relies on the sensors to get real-time reports of outages instead of relying on complaints from riders.

When the Environmental Tech Lab launched last year under DEP, Knaq entered that contest as well. e company is now demonstrating how its sensors can be used to monitor the city’s water-supply equipment remotely instead of deploying sta to check for outages, Matlen said.

e Buildings Department has a $212 million budget for the coming scal year under the city budget approved recently — less than the $219 million it was allocated at the start of last year. Oddo has at times expressed oncerns that his agency does not have the resources to take on many new responsibilities.

“ e Buildings Tech Lab represents a signi cant step forward in our commitment to harnessing cutting-edge technology to enhance our regulatory functions,” Oddo said in a statement. “Public-private partnerships like this will help us connect with emerging tech companies, with an aim to improve agency e ciency,” Oddo said.

Since its inception in the 1990s, the Partnership Fund has invested about $200 million in local companies with an eye toward boosting New York City’s economy. Since 2010, it has run a FinTech Innovation Lab that supports early-stage nancial services rms, a model that has been used as the basis for the public-sector competitions.

A Sackler nds a buyer for her Upper East Side penthouse

By C. J. Hughes

Elizabeth Sackler, a member of the family that created the opioid-crisis-fueling OxyContin, even though Sackler herself has condemned her relatives’ “morally abhorrent” business, has found a buyer for her uptown home.

Sackler, an arts advocate, is in contract to sell her three-bedroom penthouse co-op at 14 E. 90th St., according to data from Olshan Realty, a brokerage that tracks highend residential sales through signed contracts.

e unit, No. PHW, a 3,100-square-foot aerie at Fifth Avenue that o ers a library with a replace, a formal dining room and a wraparound terrace with a greenhouse, was most recently listed for about $12 million.

Whether Sackler was able to get that price for the home, which she bought for $10.5 million in 2007 from former Citi Chairman Sanford Weill, likely won’t be known till the purchase closes and its tax record hits the city register, which could take a few weeks.

But Sackler had initially put the home up for sale in April 2023 at a price of $16 million, suggesting

she misjudged the market by at least 25%.

Co-ops and condos have both faced challenges in the past couple of years as elevated interest rates have dragged on activity. But in recent months buyers have indicated that they can’t wait forever for rates to drop and are inching back into the market.

Unknown buyer

e buyer of the penthouse, which has 10-foot ceilings and Central Park views, and comes with a separate storage unit, is also unknown.

Nick Gavin of Compass and Susan Penzer of Susan Penzer Real Estate, who co-marketed the property, did not return emails by press time.

Sackler’s father, Dr. Arthur Sackler, was one of three brothers who in 1952 purchased the Manhattan-based Purdue Frederick Co. and grew it into a family of companies whose products also included the drug Valium. In 1995 one of the companies, Purdue Pharma, introduced OxyContin, a morphine-like prescription-based painkiller that would go on to be-

come heavily abused. Purdue Pharma o cials later admitted as part of a settlement that they downplayed the drug’s addictive qualities in its marketing.

Arthur Sackler died in 1987, eight years before OxyContin’s arrival. And his brothers, Raymond and Mortimer, bought out Arthur’s share in the company upon his death. Elizabeth Sackler has said she never pro ted from the drug while slamming her family’s role in downplaying its hazards.

But later reporting suggested that relatives of Elizabeth on Arthur’s side of the family could at least be indirect bene ciaries of the blockbuster sales of the drug through a chain of wills and trusts, even if Elizabeth herself is not an heir.

e Sacklers were for decades major arts patrons. But in the aftermath of the OxyContin scandal, museums including the Met in New York and the Louvre in Paris removed the family’s name from its walls, while other institutions stopped accepting Sackler gifts.

Elizabeth Sackler has led major e orts throughout her career to repatriate looted Native American art and in 2007 established the

Elizabeth A. Sackler Center for Feminist Art, a woman-centric collection and education space at e Brooklyn Museum Stamford, Connecticut-based Purdue Pharma led for bankruptcy protection in 2019. But in late June, the Supreme Court rejected a broad agreement that Purdue Pharma had worked out with local governments as part of its bankruptcy plan that would have had the company contribute up to $6 billion to opioid victims

but that also would have shielded Sackler family members from future lawsuits.

But the company, which makes other kinds of pain medications, says it will still work to correct damage wrought by OxyContin. “ e decision does nothing to deter us from the twin goals of using settlement dollars for opioid abatement and turning the company into an engine for good,” says a statement on the company’s website.

The Department of Buildings hopes to get help from the tech sector as it prepares to take on a wide range of new responsibilities, like implementing Local Law 97 and enforcing City of Yes rules. | MICHAEL APPLETON/MAYORAL PHOTOGRAPHY OFFICE

The foyer at 14 E. 90th St., Upper East Side | COMPASS

Midtown market serving interior designers faces $30 million loss as occupancy falls, costs increase

By Aaron Elstein

Midtown’s Decoration & Design Building, host to a vast private market featuring dozens of vendors serving interior designers, is facing a more than $30 million loss as occupancy falls, furthering the woes of landlord Charles Cohen.

Located across from Bloomingdale’s and Home Depot at the corner of ird Avenue and East 58th Street, the 18-story 600,000 square-foot D&D Building is the sort of place where you might happen upon a showroom with a shimmering wall sculpture resembling the backdrop of Gustav Klimt’s “ e Woman in Gold.” Another room might feature diminutive club chairs swathed in paint-splattered jacquard, a fabric patented in France in 1804. But the spectacle is smaller than it used to be. D&D had about 130 tenants in 2015, but a third have left in recent years and net cash ow has fallen by a similar amount. e building has been delinquent on its mortgage since May 2023, and lenders may have to write o $34 million of the $156 million loan balance, bond-rating rm KBRA said in a new report.

A fth of D&D tenants have leases that are month-to-month or scheduled to expire in 2024, including Stark Carpet, the largest tenant at 37,000 square feet. Stark didn’t reply to a request for comment.

50% increase in ground rent

While revenue erodes, costs are rising. Cohen owns the D&D Building but not the land underneath, and the ground rent rose by nearly 50% last year, to $6 million. It is scheduled to rise at an average annual rate of nearly 4%. Records show the ground lease is owned at least partly by the Rice Foundation, which was funded by real-estate broker Henry Hart Rice, who died in 1992.

O cials at Cohen Brothers Realty did not respond to requests for comment.

e D&D was developed in 1965, and Charles Cohen bought it for $70 million in 1996, four decades after his father and uncles started developing o ce towers on ird Avenue when the elevated train line was dismantled in 1956. Cohen Brothers holdings today include 805 ird Ave., 750 Lexington Ave., and 3 Park Ave. —

all of which are struggling with high vacancy rates. e rm controls 12 million square feet of space nationwide, including 3.3 million in four design centers in New York, Houston, Los Angeles and Miami.

e Real Deal has reported Cohen is delinquent on more than $500 million worth of loans, and he’s been sued by lenders including Fortress Investment Group and U.S. Bank for failing to pay. Forbes estimates his net worth is more than $3 billion.

For many years the D&D Building was highly pro table, generating about $23 million annually in net cash ow. Big investments in tenant improvements weren’t necessary on most oors because tenants prefer to build out their own spaces. e showrooms are a place for design-industry professionals to examine new work and negotiate deals away from the prying eyes of the general public.

D&D tenants usually won’t do business with anyone who doesn’t have an account. Westchester County-based designer Lara Michelle said in her article “Demystifying the D&D Building” that if a client wants to go by themselves, she will alert sales sta ers to be

helpful. But “they still won’t give any pricing directly to the client, that will only go to the designers,” she wrote. e pandemic disrupted the building’s awards ceremonies and other live events that helped keep the place busy, while retail remains one of the slowest sectors in New York to recover. Headcount remains 14% below prepandemic levels, according to the State

Comptroller’s o ce. Still, the D&D remains a place where designers and showroom sta cultivate lasting relationships “It’s become a second o ce in a sense for me,” Michelle wrote. “With such a concentrated amount of the world’s best products in one building, there is no other place in the area like it.”

C. J. Hughes contributed reporting

The lobby at the Decoration & Design Building BUCK ENNIS

City seeks bids for development on public-owned parcel at Hunts Point

Caroline Spivack

e city wants to turn New York’s busiest trucking hub into a freight-focused electric vehicle charging site and workforce development center and make it easier for independent or reluctant industrial operations to embrace electric eets.

A developer would lease, build and operate the new 3.2-acre space within the Bronx’s Hunts

ing pollution generated by the 15,000 truck trips that occur at the center each day.

At a sprawling 329 acres, the Hunts Point Food Distribution Center makes up nearly half of the Hunts Point peninsula. e campus is home to some 115 industrial food businesses, with more than 8,500 workers, including Anheuser-Busch, Baldor Specialty Foods, Citarella, Dairyland and Krasdale Foods, among many others.

At a sprawling 329 acres, the Hunts Point Food Distribution Center makes up nearly half of the Hunts Point peninsula.

Point Food Distribution Center, the country’s largest such facility that distributes 4.5 billion pounds of food to more than 22 million customers annually, according to plans outlined by the city’s Economic Development Corp. In a request for proposal the city was to announce July 10, the EDC said it’s looking to “stimulate a broader sector transition to electric vehicles” to reduce the planet-warm-

Under the RFP a developer would be tasked with delivering an electric vehicle charging system capable of charging a range of vehicles. To start with, the site’s footprint should include 21 direct current fast chargers and eight slower, but more common Level 2 chargers, the RFP suggests. e idea is to encourage eets to shift to electric models by reducing the need for existing tenants to make costly and time-intensive infrastructure upgrades at their leased locations.

Since nancing for the new charging facility includes a $15 million grant from the Federal Highway Administration, the site must provide 24-hour, year-round public

access to the chargers. Would-be developers must detail their proposed investments to the city. Maria Torres-Springer, the city’s deputy mayor for housing, economic development and workforce, said the city aims for the model to be a boon for local businesses but also to the surrounding Hunts Point area, which she said has “disproportionately su ered” air quality and health hazards due to the fossil-fuel powered trucks.

e selected developer would also create a multi-purpose welcome center to serve as “a front door” to the food distribution center. Such a space could o er drivers and users of the electric charging hub amenities, such as bathrooms, food and drink options, outdoor green space and a prayer and meditation room, suggests the RFP.

Additionally, at least 5,000 square feet would be dedicated to workforce training with classroom space and a recruiting o ce. A exible event space that could handle some 200 people could also be utilized for workforce and community-driven events, like job fairs, states the RFP.

ose interested in submitting a proposal to the city have until Nov. 21.

The Adams administration wants to lease out 3.2 acres of Bronx land for an EV charging station and workforce development center. BUCK ENNIS

The 3.2-acre site labeled

charging

Bronx courthouse district welcomes new rental tower with a mix of market-rate, affordable apartments

C. J. Hughes

Big new apartment buildings may still be rare in the city. But a part of the Bronx not known for high-rise development just opened one.

e Bronx Vibe, a 12-story, 155unit rental project, is welcoming tenants at 299 E. 161st St., a neighborhood known on some maps as Concourse Village but probably most familiar as the home to the borough’s courthouses.

Developed by Diamond Property Management, a Brooklyn-based rm headed by Moshe Halberstam, the project has a mix of mar-

below-market-rate residences.

e Jackson Houses, a multi-building New York City Housing Authority complex, for instance, stands a few blocks to the south. But new market-rate housing is unusual to see in the bustling area, which sits a few blocks east of Yankee Stadium. ose 108 studios to two-bedrooms, which have stainless-steel appliances, stone counters and porcelain tiles, start at $2,541 a month, or an initial rate of $2,052 when factoring in a bonus of two-and-a-half-months of free rent for a 13-month lease. Similarly, one-bedrooms start at $2,385 a month, when taking the concession into consideration.

The building offers a coworking space, a 12th- oor gym and, eventually, a moviescreen-equipped roof deck. A 52-space parking garage offers an EV charging station.

ket-rate and a ordable units after qualifying for a 421-a property tax abatement. Although the 421-a incentive expired in June 2022, the Bronx Vibe broke ground in time to be eligible. (State lawmakers earlier this year passed a watered down replacement program, 485-x.)

e neighborhood, near Metro-North tracks, is familiar with

ose units came to market in late May, and 37 had been leased as of July 10, according to Bohemia Realty Group, the site’s broker. Tenants began moving in over the last few weeks.

e Bronx Vibe’s 47 a ordable units, which are reserved for those making 80% to 130% of the area median income, meanwhile, start at $1,718 for studios and $1,829 for one-bedrooms. O ering similar nishes to the other apartments, the units are being awarded through a lottery launched in May.

Designed by IMC Architecture, a rm whose previous credits include small rentals in Brooklyn

and the Bronx, the building also o ers a co-working space, a 12thoor gym and, eventually, a movie-screen-equipped roof deck. A 52-space parking garage o ers an EV charging station.

Combined parcel

Located between Morris and Park avenues, the Bronx Vibe sits on what was formerly six di erent tax lots, most of which contained wood-frame houses. Diamond

Property snapped up the combined parcel in 2019 for $2.1 million before obtaining $40 million in construction nancing from Webster Bank for the project, according to the city register.

ough the building appears to have been conceived well before the multi-family development slump brought on by high interest rates and regulatory factors, it does seem to represent a bit of a counter-example.

Indeed, the fourth quarter of

last year saw 16% fewer building permits led than the historical average stretching back to the Great Recession year of 2008, according to the trade group the Real Estate Board of New York. And only nine projects of the group planned to have 100 or more units, according to the REBNY data, the most recent available.

Still, in April Dunn Development led plans to construct an 11-story, 120-unit project in the Bronx’s West Farms neighborhood.

Former SUNY Downstate exec charged with stealing $1.5 million for travel, luxury dog care, school tuition

By Amanda D’Ambrosio

SUNY Downstate’s former head of emergency medicine embezzled nearly $1.5 million from the nancially struggling hospital for personal travel, his kids’ school tuition payments and a luxury dog hotel, prosecutors allege.

Dr. Michael Lucchesi, 66, was charged with using SUNY’s company credit card for personal uses between 2016 and 2023, spending more than a million taxpayer dollars to fund a “lavish lifestyle,”

Millstone New Jersey, a luxury pet boarding and day care center.

e resort’s website boasts of low-impact cushioned oors, antimicrobial air ltration, no cages — only plush, all glass boarding suites and swimming lessons “since not all dogs are born knowing the doggie paddle.”

e former emergency room exec, who served at various points as the acting head of SUNY Downstate’s hospital and medical school as well as chief medical o cer, earned a salary of $264,000 in 2023, public data shows.

“The spending spree on the state’s dime alleged here is an insult to hardworking taxpayers and the medical profession.”

Lucy Lang

Brooklyn District Attorney Eric Gonzalez and New York State Inspector General Lucy Lang announced July 9.

e Staten Island doctor allegedly spent $175,000 of the hospital’s money on doggy day care, prosecutors said. Roughly $120,000 of that sum went to the Green Leaf Pet Resort and Hotel in

Lucchesi was removed from his position as emergency department chair immediately after the hospital discovered the suspicious payments, and he left his job three days later, according to a source familiar with the matter.

Lucchesi also racked up nearly $350,000 in recreational travel charges, more than $100,000 in payments to New York Sports Clubs for membership and personal training, and $46,000 in school tuition payments for his children, prosecutors said.

e former exec spent $52,000 on catering and made various pur-

chases on owers, liquor and electronics on the public hospital’s dime, according to the District Attorney’s o ce.

Suspicious payments

SUNY Downstate discovered suspicious payments during an internal review of hospital contracts, said Dawn S. Walker, a hospital spokeswoman. After detecting the activity, SUNY referred the matter to the inspector general’s o ce.

“New Yorkers deserve doctors

who uphold their oath with the utmost integrity,” Inspector General Lang said. “ e spending spree on the state’s dime alleged here is an insult to hardworking taxpayers and the medical profession.”

Lucchesi and his attorney did not immediately respond to requests for comment July 10.

Lucchesi was arraigned on nine counts in the Brooklyn Supreme Court on July 9, including charges of grand larceny and criminal tax fraud. Brooklyn Supreme Court Justice Donald Leo released Luc-

chesi without bail, and he is scheduled to return to court at the end of September. e alleged theft marks another hit on SUNY Downstate, a nancially ailing safety-net hospital that has long been targeted for closure by government o cials. Gov. Kathy Hochul included a plan to close the hospital in her executive budget proposal in January; but the move was temporarily thwarted by local lawmakers and advocates as the state conducts a review of the hospital’s future.

Inspector General

299 E. 161st St., Bronx | RARE PHOTOGRAPHY

Dr. Michael Lucchesi and SUNY Downstate | LINKEDIN, COURTESY OF SUNY DOWNSTATE

“ at’s how we ensure that the people who really need it get the best quality care while limiting the waste, fraud and abuse,” she said.

However, it’s unclear how pending changes will affect the 250,000 New Yorkers who have grown to rely on the program for care. The program began as a way to empower individuals with chronic health conditions and disabilities to have control over their care and avoid institutionalization.

“It kind of flew under the radar for a while,” said Bill Hammond, senior policy fellow at conservative think tank The Empire Center. “Until the dollars started piling up.”

Newfound freedom

There’s no question that there are success stories for the program. Jose Hernandez was 15 when he dove into the water at City Island in the Bronx. It was much shallower than he thought, and he broke his neck. As a result, Hernandez, now 44, has lived most of his life as a quadriplegic, unable to use his arms or legs.

Hernandez would not be able to care for himself or his child without a rotating staff of about five “personal assistants” — home care workers he finds and trains himself. Each day, one helps him with his bowel and bladder routine, then with getting dressed and into his chair.

The aides’ help is made possible through CDPAP. Hernandez discovered the program nearly two decades ago, after years of going through traditional home health agencies, which sent him an array of “random” people, he said, many of whom struggled to handle such a difficult case. The constant change in caretakers prohibited Hernandez from establishing a routine; he would have to bring each new worker up to speed on his many needs. Sometimes it would take twoand-a-half hours to get ready in the morning.

“It was just constantly a new person every day,” Hernandez said. “That’s exhausting.”

The program is set up so that Hernandez can be a greater master of his own destiny, a luxury

he rarely gets to enjoy. He can choose and train personal assistants to care for him how he wants and needs. The Medicaidfunded program intends to allow those in need of care, such as individuals with disabilities or the elderly, to employ home health workers of their choosing. Created in 1995, the program took off in 2015 when New York relaxed its rules to include most family members as potential paid caregivers.

“It gave me a level of freedom that I never experienced before,” he said.

Explosive growth

People like Hernandez can employ almost anyone except a spouse. A parent caring for a child under the age of 21 also would not qualify under New York’s rules.

There’s no formal training required, and caregivers are generally compensated less than a trained home health aide. Personal assistants in the city make $18.55 per hour, and outside of the city they make $17.55. If they have another job, they aren’t required to give it up, and they are eligible for overtime, paid time off and benefits.

Supporters say it’s an attractive arrangement that grants agency to vulnerable people while compensating the mostly female caregiving workforce.

New York’s aging population is one reason for CDPAP’s explosive growth, but policy changes are a more important contributor, according to a research re-

port by Step Two Policy, a think tank founded by Paul Francis, former deputy secretary for health and human services under Gov. Andrew Cuomo.

The posters plastered on subway cars speak to a relaxation of rules that began in 2015. A typical ad reads, “We are hiring caregivers! Flexible hours, great benefits, PTO, holiday pay & more,” with some even touting sign-on bonuses.

That year, state officials expanded the universe of people who could receive personal care services, as well as those who could provide services under the program. The looser rules, combined with a 2017 “wage parity” provision — an hourly rate set at $4.07 above minimum wage in the city — were the two primary factors accelerating the growth of the program, according to a report by Step Two Policy.

The growth is by far the largest of any employment sector, according to James Parrott, director of economic and fiscal policies at The New School. He said the average annual wage is about $38,000.

“It really has been an independent force on its own,” he said. e workforce, which reached 299,000 in May, outnumbers retail clerks and fast food workers combined, according to Hammond.

Lack of oversight

Critics say the program’s spending is out of control, and that the industry supporting the program has been allowed to proliferate unchecked and with

minimal oversight.

A 2018 federal audit from the Department of Health and Human Services found that New York billed Medicaid nearly $75 million in fraudulent CDPAP claims from 2012 to 2016.

“New York’s lack of effective monitoring of the CDPAP leaves the program vulnerable to misuse of Federal funds and could potentially place beneficiaries at risk of harm,” the audit reads, noting that it was conducted because previous reviews identified personal care services in New York as vulnerable to abuse.

The audit pinned much of the blame on the middlemen companies, which manage payroll and help participants navigate the program; in exchange, they receive a share of the funding, according to Bryan O’Malley, the executive director of the Consumer Directed Personal Assistance Association of New York State, an industry group that supports the program.

As the program has swelled, the number of middlemen companies has also grown across the state to meet demand. There were just 68 such companies in 2013, according to O’Malley.

Now, they are a target of regulators.

The state estimates there are as many as 700 companies managing the administration of the program. Late in this year’s budget process, in an effort to save money and increase transparency, the governor proposed streamlining the administration to just one company. The move is expected to save $200 million in the first year and $500 million after. Last month, the state released a request for proposals for a sole company to administer the program, and the race is on. Public Partnerships, a firm that operates in more than a dozen states and is expected to compete for the contract, recently inked a $6,500 monthly contract with lobbying firm Cozen O’Connor for “strategic advice and business development,” according to state records.

There’s a case to be made for reducing CDPAP, said Hammond of The Empire Center.

“Where do you draw the line? There’s a lot of unpaid caregiving going on,” he said. “But traditionally we don’t think of all interactions between family members as labor. We don’t pay

parents for raising their children. There are an awful lot of families down through the ages who have taken care of their elderly relatives without expecting to get any money for it. So if we redefine all that activity, it’s going to get very expensive.”

Similar shift

Massachusetts underwent a similar shift with its Personal Care Assistant program in 2022. The program is much smaller than New York’s, with a workforce of about 55,000 people serving 40,000 residents. The program began in 1988 and has grown but not as quickly; eligibility remained limited to the disabled community. Massachusetts reduced the number of middlemen companies as a cost-cutting measure, but on a much smaller scale: The Bay State had just three providers compared to the hundreds in New York.

Chaos ensued as payments were delayed for thousands of caregivers due to administrative snags. In the days immediately following the switch, the state’s selected single organization, Tempus Health, wrote on its Facebook page that it had received 32,000 phone calls, according to The Boston Globe . About 10% of workers missed payments when the change was enacted, which led to workers leaving, according to O’Malley. In New York, that would equate to about 25,000 consumers and 35,000 workers.

“That is an immediate health care crisis that is entirely avoidable because we have a system that works today,” he said.

Massachusetts Gov. Maura Healey’s budget proposal targeted the program again this year as a way to close a $950 million gap in MassHealth, the state’s version of Medicaid. The proposal says that only those who receive more than 10 hours of care per week would be eligible for the program.

In New York, applications to become the sole administrator for CDPAP are due by the beginning of August, and the contract is set to start on Oct. 1.

Hernandez is wary of the change. “I made a life for myself and I’m trying to make a life for my family,” he said. “Now I’m just scared.”

Personal assistant Bakary Sawo helps Jose Hernandez from his bed into his wheelchair and then helps him brush his teeth.

| BUCK ENNIS

sued and accused Michael Malekan of fraud, breach of fiduciary duty, and misappropriation of trade secrets. He described his brother as a “faithless servant” and bitter ex-employee who tried to hurt the family clothing business by sending customers to a rival store he secretly formed called Ooh La La. Albert Malekan alleged Michael took $244,000 in excess distributions out of Alberto Makali.

The feud casts light on a New York real estate family that has mostly stayed in the shadows until now. Neither Michael nor Albert Malekan would comment, nor would their lawyers.

“I’m not telling you a thing. Not one thing. Zero,” said Stephen Siminou, an attorney for Albert Malekan. An attorney for Michael, Mara Levin, answered the phone and said she interrupted a call discussing media strategy to speak briefly to Crain’s, but didn’t call back or return a subsequent call.

The brothers’ suit and countersuit were both filed last year but escaped attention until a bond-rating firm mentioned the legal dispute in a report analyzing the mortgage for a building owned by Albert Malekan that isn’t part of the litigation. Last month a state judge gave the

warring parties a January deadline to produce evidence.

Albert Malekan hails from western Asia, according to Alberto Makali’s website, and state court documents indicate Farsi, the language of Iran, is the family’s native tongue. Albert and Michael’s father, Elyaho Malekan, was an art collector who in 2008 sued a dealer for allegedly making off with an artwork from czarist Russia. Elyaho Malekan said the dealer told him, “They [the Russian Mafia] would kill [Malekan] or members of [Malekan’s] family if [Malekan] made trouble.”

Albert Malekan moved to the U.S. at an unspecified date to study at Columbia University and introduced women’s wear to his brother’s store, according to Makali’s website. Movie star

Heather Graham wore an Alberto Makali dress that she said “felt like springtime” while doing press interviews before the Tribeca Film Festival in 2013.

Along the way, Albert Malekan “cultivated an eye for design and developed his entrepreneurial spirit” and began investing in real estate 30 years ago. He owns Manhattan properties including 75 Greene St., 466 Broome St., 419 Lafayette St. and 552 Seventh Ave., records show. The city Department of Finance estimates their combined value is about $60 million. The locations of other properties couldn’t be deter-

mined because they’re owned by LLCs.

419 Lafayette is a 75,000-squarefoot o ce building whose tenants include M13, a venture capital rm run by Paris Hilton’s husband, Carter Reum. e building recently secured a new $20 million mortgage from Citigroup, and Malekan pocketed $15 million in cash as part of the transaction, bond-rating rm KBRA said in a report last month.

Allegations of misconduct

Albert Malekan is the sole managing member or “de facto managing member” of each

property and maintains exclusive management, control and operation authority over each, Michael Malekan ’s lawsuit says. Michael alleges his brother cheated him and other family members repeatedly. In one example, Albert Malekan allegedly allowed Donatella Versace to buy out her Greene Street store’s lease during the pandemic in return for a $3 million payment. But the money wasn’t shared with Michael Malekan, who controls a 20% stake in the building along with brother-in-law Shahram Golpanian.

In another case, Albert Malekan allegedly allowed beauty retailer

Jill Stuart to walk away from its Broome Street store, where it owed more than $500,000 in back rent, in return for a cash payment and the store’s remaining inventory, which was then sold in a di erent shop run by Albert’s wife. Proceeds weren’t shared with family shareholders, Michael Malekan alleged, and Albert mismanaged the SoHo property so badly that it went into default, forcing family members to pay “excessive penalties and interest” in order to avoid foreclosure.

“ e above examples do not even scratch the surface of Albert’s misconduct,” alleged Michael Malekan, who further accused his brother of “intentionally manipulating books and records to make it look as though the properties are operating at loss.” at, he contended, was done in order to force family members to pony up more cash to lenders or to substantially devalue the buildings.

Michael Malekan said Albert Malekan has directed his accounting firm to file “fraudulent tax returns” on behalf of the family real estate business. For example, in 2020, the Greene Street building received a $2.2 million lease termination fee but the income was not reflected in the property’s tax return.

“In the event the 2020 tax return was audited by the IRS, taxes, interest and penalties would be levied as a result,” Michael Malekan alleged.

Albert Malekan | FACEBOOK

CLASSIFIEDS

Senior Associate (Citadel Enterprise Americas Services LLC – New York, NY); Mult. Pos. Avail. Resp for spec expense lines, incl trends and internal allocations, to ensure accurate accounting of costs across front ofc, back ofc, and tech teams. Collaborate across multiple teams to produce journal entries, recurring audit support, and financial statement footnotes. F/T. Sal range $155,000 to $195,000/yr. Resumes: citadelrecruitment@citadel.com. Ref: Job ID: 7997130.

Staff Engineer positions (WarnerMedia Services, LLC; New York, NY). Develop core functionality & components for app svc in support of various content platforms by starting w/ business needs & objectives, creating functional & tech specifications. Hybrid work schedule. Salary range is $169,229/yr - $183,700/yr, based on qualifications. Email resume to wbdi@wbd.com. Ref: 7614029LN.

Director, Data Science positions available (NBCUniversal Media, LLC; New York, NY). Serve as tech lead in advanced statistical & ML methodologies & manage team of data scientists to create analytical solutions for multiple business verticals. Salary range is $200,000/yr to $240,000/yr, depending upon qualifications. Send resume to: Elsbeth Velasco-Fulgencio at elsbeth.velasco@nbcuni.com, & indicate you are applying for Director, Data Science (SC24LN) opening. NBCU is an EOE.

Senior Marketing Manager, Non-Alcohol – positions offered by Diageo North America, Inc. (New York, NY). Lead creation of long-term non-alcoholic brand strategy across D2C, On / Off & Non premise channels & activity plans based on consumer / customer / shopper insight. Position reports to office in New York, NY. Position may work from home, but must live within commuting distance of stated office. We are offering a salary of $173,056 to $209,875 per year. Apply online: www.diageo.com/en/careers

The New York Racing Association, Inc. ("NYRA") is soliciting bidders to provide talent management services. The Talent Management Solution should assist NYRA in completing a job architecture, completing job mapping and competency or skill modeling, map all jobs to current employees, and restructure the compensation policy. Qualified bidders must have the ability to complete this project by October 31, 2025.

M/W/DBE participation is encouraged. The bid document, including specifications and requirements, may be obtained via an email to procurement@nyrainc.com¬ or please register as a vendor on NYRA’s bidding portal at no cost. www.bidnetdirect.com/new-york/nyra

Notice of Formation of AG PARATUS LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 5/16/24. Office location: NY County. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to 228 Park Ave South, #196188, NY, NY 10003. Purpose: Any lawful activity

Notice of Qualification of AMBER

72 LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 06/25/24. Office location: NY County. LLC formed in Delaware (DE) on 02/27/17. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to c/o Corporation Service Co., 80 State St., Albany, NY 12207-2543. DE addr. of LLC: 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with Jeffrey W. Bullock, Secy. of State , DE Div. of Corps., 401 Federal St., Ste. 4, Dover, DE 19901. Purpose: Any lawful activity.

Notice of Formation of V-Line Beauty LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 6/4/24. Office location: NY County. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to; 513 W. 145th St Apt 5E, NY, NY 10031

Purpose: Any lawful activity

Notice of formation of Limited Liability Company (“LLC”). Name: Good Co Residential LLC Articles of Organization filed with the Secretary of State of the State of New York (“SSNY”) on May 28, 2024. N.Y. office location: New York County. The SSNY has been designated as agent of the LLC upon whom process against it may be served. The SSNY shall mail a copy of any process to Good Co Residential LLC, c/o The Domain Companies LLC, 120 Broadway, Suite 1340, New York, New York 10271. Purpose/character of LLC is to engage in any lawful act or activity.

Notice of Formation of QUILCHENA PARK LEGAL LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on4/19/24. Office location: NY County. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to 219 E. 2nd Street Apt 5B, NY, NY 10009. Purpose: Any lawful activity

NO SOUL FOR SALE LLC Arts of Org filed w/SSNY 03/27/2024. Office: NY Co. SSNY designated agent for process and shall mail copy to 44 SAINT MARKS PL, #4, NY, NY10003. Purpose: any lawful act."

Notice of Formation of THEVOZ & PARTNERS, LAW FIRM, PLLC. Arts of Org filed with Secy of State of NY (SSNY) on 11/22/23. Office Location: NY County. SSNY designated as agent upon whom process may be served and shall mail copy of process against PLLC to 1239 Broadway, Ste 1005, New York, NY, US 10001. Purpose: any lawful act.

QUILLIAN, LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 05/20/24. Office location: Bronx County. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to; 135 W. 225TH ST, APT 5F, Bronx, NY 10463 Purpose: Any lawful activity

#202, Bklyn, NY, 11228. Purpose: any lawful act."

Notice of Formation of RWP Bar and Grill LLC. Arts of Org filed with Sec'y of State of NY (SSNY) on 11/9/23. Office location: NY County. SSNY designated as agent upon whom process may be served and shall mail copy of process against LLC to Rocket Corporate Services Inc., 2804 Gateway Oaks Dr., Ste 100, Sacramento, CA 95833. P/B/A: 330 W 28th St., 18A, NY, NY 10001. Purpose: Any Lawful Act."

Notice of Qualification of MATRIX HOLDINGS II DE L.P.

Appl. for Auth. filed with Secy. of State of NY (SSNY) on 06/24/24. Office location: NY County. LP formed in Delaware (DE) on 04/18/24. Princ. office of LP: c/o The Blackstone Group Inc., 345 Park Ave., NY, NY 10154. Duration of LP is Perpetual. SSNY designated as agent of LP upon whom process against it may be served. SSNY shall mail process to the Partnership at the princ. office of the LP. Name and addr. of each general partner are available from SSNY. DE addr. of LP: Corporation Service Co., 251 Little Falls Dr., Wilmington, DE 19809. Cert. of LP filed with Secy. of State of the State of DE, Jeffrey W. Bullock, 401 Federal St., Ste. 4, Dover, DE 19901. Purpose: Any lawful activity.

Notice of Formation of PHILIP R. WEISSMAN, PLLC .Arts. of Org. filed with Secy. of State of NY (SSNY) on 04/4/24. Office location: NY County. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to; 625 West 57th ST, # 2309 New York, NY 10019. Purpose: Any lawful activity

Notice of Formation of BEING UNBOUND MENTAL HEALTH COUNSELING PLLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 02/15/24. Office location: NY County. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to; 70 Park Terrace East, Apt 4H, New York, NY 10034. JOHNORR77@GMAIL.COM Purpose: Any lawful activity

Notice of Formation of KALUMIPROP LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 5/31/24. Office location: NY County. United States Corporation Agents, Inc., designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to: 7014 13th Avenue, Suite 202, Brooklyn, NY 11228. Purpose: Any lawful activity

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King Charles buys Canada a Billionaires Row condo

By Julianne Cuba

is apartment is t for a king. e Canadian government has splurged on a luxe condo on Billionaires Row, records show, representing the complete sellout of the landmarked Steinway Hall building at 111 W. 57th St. With “His Majesty the King in Right of Canada, Represented by the Minister of Foreign A airs,” listed as the buyer, the Great White North has acquired a three-bedroom, four and a half bathroom apartment on the eleventh oor of the Midtown complex, for $6.6 million — or $8.9 million in Canadian dollars — according to a deed that appeared in the city register

whether it’s Tom Clark, the consul general of Canada in New York, or His Majesty King Charles III himself. Clark was named consul general in 2023, and Charles ascended to the throne of the constitutional monarchy of the United Kingdom, becoming also the sovereign of Canada, following Queen Elizabeth’s death in September 2022, according to information on the government of Canada’s website.

Close proximity

The Canadian consulate is located at 466 Lexington Ave. and is a 25-minute walk or an eight-minute drive from the luxury condominium.

July 9. e sale closed in June. It’s unclear who exactly will occupy the 3,601-square-foot pad with views of the city and access to a swimming pool and sauna —

e Canadian consulate, which did not respond to a request for comment, is located at 466 Lexington Ave. and is a 25-minute walk or an eight-minute drive from the luxury condominium, which was developed by Miami-based real estate rm JDS Development. It’s not unusual for the general consulates of foreign nations to live — and party — in lavish Manhattan apartments within close proximity to the United Nations, as Crain’s has previously reported.

Robert McCubbing, whose LinkedIn says he is the senior trade commissioner and director of trade and investment at the

consulate general of Canada in New York, signed the deed on behalf of His Majesty, records show, and developers Kevin Maloney and Michael Stern of JDS signed the deed on behalf of the seller.

e Billionaires Row complex features 60 total residences. Fourteen of them, including Canada’s new digs, are in the landmarked Steinway Hall, which has now been completely sold, said Anna Crowley, a representative for the

property, and the remaining 46 full- oor and duplex residences make up the adjacent 91-story tower, which has sweeping views of Central Park.

Crain’s reported last year that Apollo Commercial Real Estate Finance, the lender with debt tied to the Midtown apartment, was wary about the slow pace at which units were selling. Crowley did not respond to a question about how many of the 46 units in the 91-sto-

ry skyscraper have so far been sold but said that so far this year the entire West 57th Street complex has reported nearly $100 million in sales. Crowley also declined to answer questions about who will be living in unit 11A,  which rst went on the market in 2022 for $10.7 million, was listed again for $8.5 million a year later and then nally went into contract after a 16% price drop to $6.8 million in May, according to StreetEasy.

King Charles and 111 W. 57th St. BLOOMBERG , GOOGLE STREET VIEW

Architecture rm chief blends creativity with a solid foundation

Scott Spector’s company, Spectorgroup, is now approaching its 60th anniversary.

When organic chemistry, a notoriously di cult college course, got the better of Scott Spector during his freshman year at the University of Michigan, he had to rethink his dreams of going into sports medicine.

Spector, a lacrosse player at the school, pivoted to its architecture program, for which physics, a subject he excelled at, was a requirement. After graduation, Spector pursued his master’s degree in architecture at the University of Maryland and ended up following in his father’s footsteps.

Spector’s dad, Michael Harris Spector, started his eponymous architecture rm, Spectorgroup, in the mid-1960s. e younger Spector joined the company in 1987 and took over in 1998 — a year before his father retired — and spearheaded the opening of its New York City o ce; his father died in 2018. e rm was at rst based on Long Island, but it later moved into the city and as of almost two years ago is now headquartered at 200 Madison Ave. — a space that, naturally, Spector’s team designed.

Now approaching its 60th anniversary, Spectorgroup has become one of the premier architecture rms for major building renovations and commercial interiors in the New York City metro area. e rm opened an o ce in Miami about a year ago. Spector says his work has taken him all over the

country. For his next big projects, he has his sights set on West Palm Beach, Chicago, Atlanta and Austin.

“I spend roughly 90% of my time in the New York metro area,” he said. “But all these lovely clients keep taking us everywhere. So I tend to be on a plane a little bit more often than normal.”

Touring the sites

Spector serves as the principal of the rm. He spends part of his days doing typical o ce work, such as collaborating with his team and communicating with current and prospective clients. But a large chunk of his week is spent actually touring the sites on which he plans to work.

Spector also oversees the entire rm to ensure the completion of each project, which recently included o ce spaces for Citrin Cooperman, Applied Underwriters and e Carlyle Group. He nds the creative process to be the most ful lling part of his work and enjoys seeing the end result.

“I take pride in being able to shape the way that people live, work and experience the built environment,” he said.

In the ve boroughs, Spectorgroup has handled projects everywhere but Staten Island. His team has designed the headquarters for large accounting rms and well-known technology, legal and

entertainment companies such as Colliers, Uber and VaynerMedia.

e rm also helped redevelop Brook eld Place and the old Jehovah’s Witnesses watchtower in Dumbo, which was bought in 2013 by RFR Realty and Kushner Cos.

Spector’s team mainly focuses on commercial buildings but plans to take on more specialty retail, concierge-type environments and fashion showrooms in the near future.

Last year, Spector estimates, his rm worked on projects that totaled between $250 million and $300 million in construction costs, and said he averages around the same each year on about 150 different projects. e rm typically takes in about $15 million a year in architectural fees associated with that work, including for design and other basic services, he said. e key to designing a worldclass building, Spector says, is using materials that not only look the best aesthetically but are also the most structurally sound — a lesson he learned from his father.

“If you’re going to go into the world of architecture, you have to have an education not only in design, but you also need to understand how to build a building,” he said. “If you come in with just the fantasy of the architectural design, you need that foundation — literally — to understand how to put things together.”

By | Julianne Cuba

Age 61

Grew up Great Neck, Long Island

Resides Brookville and Amagansett, Long Island

Education Bachelor’s in architecture, University of Michigan; master’s in architecture, the University of Maryland, College Park

Sports fan Spector cheers for the New York Rangers, Knicks and Yankees, and, of course, Michigan. Go, Blue!

Favorite buildings His favorite part of the local skyline is the Seagram Building at 375 Park Ave. in Manhattan. He’s also a fan of the design of the interior of the Pantheon in Rome.

Home life Spector, who has three grown kids and two grandchildren, lives with his wife, whom he met while at the University of Michigan, in a house he designed from scratch. When he’s not working, he enjoys collecting art, traveling, and playing and watching sports.

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Scott Spector

Scott Spector (right) is the principal of Manhattan-based architecture rm Spectorgroup, which is set to celebrate its 60th anniversary. BUCK ENNIS