Crain's New York Business, January 22, 2024

CRAINSNEWYORK.COM I JANUARY 22, 2024

THE REAL ESTATE FAMILIES WHO

RUN NEW YORK A look at 14 families that are influential in New York real estate. PAGE 18 A brief look at some key players, including the Cohens, Kushners and Roses. PAGES 18-20

— Telisha Bryan, managing editor

CRAIN’S COMPOSITE

ONLINE: See longer profiles of the major names in New York’s real estate industry at CrainsNewYork.com/RealEstateFamilies

New York is real estate, and the foundation of that real estate is in many cases families.

Some have names you know — the Dursts, Kushners and Silversteins — and others, like the Goldmans, keep a lower profile. But all have an outsize influence on the streetscape and how the city runs.

Crain’s set out to catalog the most influential and newsworthy real estate families in New York by looking at notable portfolios as well as how long they have been in business. We’ve noted their origin story, key players and the times they have made news — and the times they may wish they hadn’t.

Hochul, Adams tone down warnings in budget plans

By Nick Garber

Gov. Kathy Hochul and Mayor Eric Adams released budget proposals last week that would chart a mild course on spending for the city and state in the coming year, rejecting tax increases and largely aligning on the big question of migrant aid as the

mayor toned down his previously dire projections about the city’s fiscal future.

Hochul’s $233 billion executive budget for Fiscal Year 2025, released Tuesday morning, would boost overall spending by about 5% compared to last year and spend $2.4 billion to help the city respond to the migrant crisis. Although Hochul’s admin-

istration described a need to “normalize” spending after a few years of inflated spending thanks to federal pandemic aid and sky-high tax receipts, the plan proposed no drastic cuts — and in fact forecast smaller future-year shortfalls than the state had previously anticipated.

Adams’ $109 billion preliminary bud-

get, released hours later, made good on his threat to deepen cuts to a wide range of city agencies on top of the initial reductions he imposed in November. But Adams notably exempted a half dozen agencies from the full cutbacks, saying See BUDGETS on Page 22

VOL. 40, NO. 3 l COPYRIGHT 2024 CRAIN COMMUNICATIONS INC. l ALL RIGHTS RESERVED

CHASING GIANTS Vontelle’s eyeglass frames are tailored to people of color.

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CONVERSATION Curaleaf’s CEO talks about why partnerships matter for the state’s nascent weed biz. PAGE 13

BUSINESS SPOTLIGHT Concierge urgent care firm looks to reach more New Yorkers.

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Mayor’s $733K in legal fund donations came from Bloomberg, real estate executives and himself

By Nick Garber

Former Mayor Michael Bloomberg, along with a slew of real estate executives and a recent City Hall chief of staff are among the nearly 200 people who gave a combined $732,510 since November to the legal defense fund of Mayor Eric Adams. The fund was created to defray the costs of the federal probe into his campaign, according to a mandated disclosure his attorneys filed on Jan. 16.

The list of names was required to be made public under the law that allowed Adams to set up the fund in November. Donors could contribute a maximum of $5,000 each, with bans on contributions from corporations, Adams’ subordinates in government, and people doing business with the city.

Bloomberg, the billionaire ex-mayor who speaks regularly

go, a Douglas Elliman real estate agent and known nightlife companion of the mayor’s. Alexander, Olga and Maxwell Rovt, three members of a prominent real estate family, each donated $5,000 to Adams’ fund in December. (Alexander Rovt has also played a role in the board drama that has engulfed the One Brooklyn Health system.)

Other donations Raymond, Isaac and Edward Gindi, members of the real estate family that controls the Century 21 department store fortune, donated a combined $5,000, the records show.

Queens Assembly member Jenifer Rajkumar, a top ally of the mayor’s who appears frequently by his side, donated $2,500 in December. And Mayor Adams appears to have given himself $120, according to donations registered to a Brooklyn address.

“New Yorkers called. They said that they want to help,” Adams said when asked about the contributions at a press conference Jan. 16. “People have known my character and said they want to help.”

Ruben Azrak, an apparel entrepreneur and landlord, donated the maximum in November. Dan Ostad, CEO of the Long Island-based construction company Rockwell Developers, contrib-

“New Yorkers called. They said that they want to help. People have known my character and said they want to help.”

— Mayor Eric Adams with Adams, donated the maximum $5,000 in December, records show. Fellow billionaire Leonard Blavatnik, a Ukrainianborn magnate who owns a majority of Warner Music Group, also gave the maximum last month.

Other recorded donations include $5,000 from Eleonora Sru-

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uted $2,500 in December.

Cryptocurrency entrepreneur Brock Pierce, known for his friendship with the mayor, and for flying him to Puerto Rico on his private jet after the 2021 election, also donated $5,000 to the mayor’s fund in December, as did Pierce’s wife, Crystal Rose.

Adams’ attorneys had previously told news outlets that the donations would amount to just over $650,000. But the city’s Conflicts of Interest Board unexpectedly posted donations that went past the first disclosure deadline

on Dec. 31, attorney Vito Pitta, a representative for Adams’ trust, said in an email.

The fund on Jan. 16 also reported nearly $440,000 in expenses.

Most of that total went to the law firm WilmerHale, which is representing the mayor as the FBI reportedly investigates whether his 2021 campaign colluded with the Turkish government in a straw-donor fundraising scheme.

The mayor’s fund also got a significant boost from Frank Carone, the Brooklyn attorney who served one year as Adams’ chief of staff

and was a top campaign adviser.

Carone himself gave $5,000, while at least three of his relatives each gave $5,000. (News outlets including Politico and the Daily News first reported on several of Adams’ expected donors.)

Donors to the mayor’s fund hailed from seven states, as well as Puerto Rico, and spanned a wide range of professions: Other donors included Caterina Skenderi, chief operating officer for the Greek restaurant Taverna Kyclades, and Devi K. Bachu, an immigration attorney.

Broadway League president to step down after 18 years

By Jack Grieve

Barbara Blair

Mayor Eric Adams’ legal defense fund raised more than $732,500 since November and spent about $440,000 to cover costs related to the federal probe into his 2021 campaign, new disclosures show. | ED REED/MAYORAL PHOTOGRAPHY OFFICE/FLICKR

Broadway League President Charlotte St. Martin is stepping down from her role leading the theater industry’s powerhouse national trade association, a position she has held since 2006. St. Martin presided over the most successful run ever for theater in New York and was instrumental in steering the Great White Way’s postpandemic recovery.

St. Martin will officially step down Feb. 16. Executive Vice President and General Counsel Jason Laks will serve as acting president while the League conducts a search for St. Martin’s replacement, according to a statement announcing her retirement. St. Martin will serve in an advisory capacity for special events through the 2024 Tony Awards in June.

“It has been the honor of my career to lead this organization, and I am grateful for all that we have accomplished together,” St. Martin wrote in the statement. “I am very proud of our League team and the

successes we have shared and know they will continue to provide the League with the highest level of commitment for which they are known.”

‘Broadway Charlotte’ St. Martin grew up outside Dallas, started working at a movie theater concession stand at age 12, spent several decades in the hospitality industry — mostly working for Loews — and then was recruited to head the Broadway League in 2006. Even before taking the job, her friends called her “Broadway Charlotte” because she went to 25 to 35 Broadway shows a year.

She was named to Crain’s Hall of Fame list in 2019 after a record-breaking year for Broadway.

“We represent the producers and the theater owners, and we have allowed them to pull together marketing networks and labor networks,” St. Martin said of the League’s work at the time.

She also made Crain’s list of the most powerful women in New

York in 2021. That year, she was a key player in drawing back the curtains for Broadway’s post-pandemic return, coordinating politicians, talent, unions, theaters and producers; Charlotte St. Martin presided over the most successful run ever betting that for New York theater. | BUCK ENNIS Covid-related safety measures would lure back tive prognosis for the months hesitant regional fans; and, finally, ahead. “It’s one of the biggest planning a public-facing opening springs we’ve ever had,” she said. party to tell New Yorkers that “It’s very exciting when you look toward what’s to come. I’m cauBroadway was back.

Despite that work, the industry tiously optimistic with where we continues to wiggle its way back are and where we’re going.”

Outside of her work with the from the pandemic, and Broadway remains an arms-length away League, St. Martin is on the board from where it was just a few years of NYC Tourism + Conventions. ago. During the 2022-23 season, She has served as president and attendance clocked in at 12.3 mil- CEO of Loews Anatole Hotel, chair lion, down about 20% from the re- of the New York Society of Association Executives, chair of Meeting cord-high of the 2018-19 season.

St. Martin acknowledged to Planners International and chair Crain’s this month that Broadway of the Professional Convention would “probably not” see 2019 Management Association Founlevels this year but offered a posi- dations.

2 | CRAIN’S NEW YORK BUSINESS | January 22, 2024

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CHASING GIANTS

Vontelle co-founders Tracy Green (left) and Nancey Flowers-Harris. Their designs often feature bold shapes and colors, along with patterns derived from the African Diaspora. | BUCK ENNIS

This self-funded startup is the latest craze in eyewear Vontelle’s frames, tailored to people of color, can be found everywhere from Saks Fifth Avenue to Walmart

The upstart: Vontelle

W

around the nose and cheeks.” she says.

Her favorite Vontelle pair features royal blue rims and an African print on the arms. “The designs are very striking,” she says. “I’m telling you, I get complimented every single day.”

hen health finance executive Tracy Green lost her glasses, she encountered her usual problem — she couldn’t find new frames that fit her face. Her long-time best friend, marketing and sales exec Nancey Flowers-Harris, had similar complaints about finding suit- The reigning Goliath: EssilorLuxottica able frames. “And the worst part is, they all look the same!” she says. “Why can’t we have something with color and patHeadquartered in the suburbs of Paris, EssilorLuxottica tern, that represents our culture?” owns 150 eyewear brands including Ray-Ban, Oakley and In October 2020, they launched Vontelle, a startup that Emporio Armani along with 18,000 stores including the makes glasses for people of color. Vontelle frames have wid- Sunglass Hut, Pearle Vision and LensCrafters chains. Its er bridges, wider rims, and longer arms. They are typically 2022 revenue topped €24.5 billion. designed to fit faces with higher cheekbones and a larger or lower nose bridge.

How to slay the giant The 76 designs for men, women and children often feature bold shapes and colors, along with patterns derived Despite Green and Flowers-Harris’ success as business from the African Diaspora, including African, Latin and Ca- executives, the pair knew nothing about eyewear before ribbean prints. The best-selling frame, Rwanda Wayfarer, Vontelle. features a traditional Ankara print from tribes that have They started by taking facial measurements of friends and roots in Central and West Africa. family. They later attended an event where they “I don’t know of any other companies doing this, conducted a survey asking women, “Where do your and it’s a huge market,” says Michelle Baltrusitis, glasses hurt?” And, “Where do you get indentations who runs the Future Collective, a six-month accelor marks on your face?” erator program for Black-owned businesses hosted Based on the feedback, Green hand-drew ideas

by Fiverr, the SoHo-based freelance platform. on paper, pulling shapes from her own eyewear colThe Future Collective selected Vontelle as one of lection. Flowers-Harris taught herself to use Corel10 startups from 4,000 applicants, in part, because DRAW and designed frames using templates found it had established itself in the eyewear industry online. with a tiny team and little funding, using freelance It took six months to find a manufacturer that untalent on Fiverr. “At the time of application, they derstood what the Vontelle was trying to do, the Anne Kadet had started to talk to some big-box retailers, and co-founders say. Several factory owners in China they were going to get their glasses in stores. There initially refused to make glasses that were so much were things in the works. That was exciting to us,” says Bal- larger than the standard sizes. trusitis.

“We got a lot of pushback,” says Flowers-Harris.

The five-person company, based in Crown Heights, The co-founders spent $100,000 from their own savings to Brooklyn, has so far sold 33,000 pairs of glasses and expects launch the company including placing what was, in retroto double sales in 2024. While it’s currently profitable, the spect, a ridiculously large order for its first shipment of co-founders say that’s because they have yet to pay them- frames. selves a dime.

“We were insane. We started with 37 designs, 300 of each,” Many Vontelle customers buy multiple pairs, the says Flowers-Harris. “Most people start with 10.” co-founders say. They include book publicist Yona DeshomBut the unwitting gamble paid off. Small retailers in cities mes, who bought a pair for her father and four pairs for her- including Atlanta and Houston reviewing the large collecself. Until she purchased frames from Vontelle, she never tion assumed Vontelle was bigger than it actually was, found glasses that fit. “Especially around the nose area. which made them more willing to give the frames space in Some people of color have wider noses, and I have high their stores. cheekbones, and sometimes the lenses don’t quite fit The pair had few industry contacts, but a Zoom call in

February 2021 devoted to the topic of eyewear for diversity was the catalyst for Vontelle’s next stage of growth.

The co-founders wrote down the names of every person on the call and reached out to them on LinkedIn. The effort resulted in a long-running partnership with an eyewear wholesaler, a licensing deal with Nickelodeon for children’s frames and an introduction to a helpful industry group.

And the results keep coming. Their wholesale connection introduced them to America’s Best Contacts & Eyeglasses.

Vontelle’s new collection designed specifically for the national retail chain’s 900 locations will debut in February.

Green and Flowers-Harris had to make some pivots from their original plan in order to grow. Initially, Vontelle sought to offer frames without prescription lenses. But the co-founders soon learned opticians typically charge $500 for prescription lenses when a customer brings in their own frames — too pricey for Vontelle’s target market. They found their own low-cost lens maker and charge between $135 and $350 for frames complete with lenses—including readers and progressive prescriptions.

They also scratched their plan to rely entirely on direct-to-consumer sales. While online sales were strong through the pandemic, there was eventually too much competition. They started offering their wares wholesale through optical shops around the city and then the U.S. and the Caribbean. Now, 60% of Vontelle frames are sold through more than 100 retail outlets, including Amazon, Walmart and Saks Fifth Avenue — a partner introduced by a friend of a colleague Flowers-Harris knew from her marketing and sales days.

“Everything goes back to our work history, and the people that we’ve met along the way, and the fact that we’ve always kept connections with everyone,” she says.

The next challenge There are more than 20,000 eyewear retailers in the U.S., and the co-founders can’t make all the sales calls themselves. “We also need money to produce more glasses,” says Green. “You have to pay for everything upfront, and then you sell it on the back end, and the revenue comes six months later.”

To that end, the pair is looking to raise a $10 million seed round. “I’m thinking really big,” says Green, who has an eye on expanding to South America, Africa and Asia. “I want a team. I want everything!”

Anne Kadet is the creator of Café Anne, a weekly newsletter.

January 22, 2024 | CRAIN’S NEW YORK BUSINESS | 3

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WHO OWNS THE BLOCK

An East Harlem street tries to get back on track

1825 PARK AVE.

The neighborhood continues to suffer from some rough edges, according to residents, including sidewalk drug use

By C. J. Hughes

81 E. 125TH ST. The banks, theaters and markets that packed 125th Street a century ago slowly succumbed to a familiar chain of events. When they closed, churches often claimed their real estate, or city officials did for non-payment of taxes, or both.

The Queen Anne structure on this corner started out in 1884 as a mixed-use building with apartments above the Mount Morris Bank, which later gave way to the Corn Exchange Bank, before Chemical Bank bought Corn in 1954. Unpaid taxes forced the city to seize the property in 1972.

Local resident Ethel Bates, who envisioned a cooking school there, bought the landmark from the city’s Economic Development Corporation for $10,000 in 2003, records show. But the school never came to pass, and the structure fell apart, forcing the city to take the property once again.

Its dilapidated top floors were lopped off in 2009.

But Artimus Construction, the Haron family’s development firm, bought No. 81 for $1.5 million in 2011 and then spent $13 million to reconstruct it. Still, the investment may have flopped. The seven-story, 39,800-square-foot building is now completely vacant except for the ground-floor Ginjan Cafe, which serves African specialties like chicken yassa. The brokerage B6 Real Estate Advisors has been trying to sell the site since 2021.

1825 PARK AVE.

135 E. 125TH ST.

This 12-story prewar office building, which practically nuzzles a Metro-North viaduct, was developed in 1901 as the home for Lee Brothers Storage & Van Co., a tenant that later took ownership of the property. Tenants today include Beth Israel, Carver Federal Savings Bank and law firm Greenstein & Milbauer, who pay around $35 per square foot, according to CoStar. After buying the property in 2015 for $48 million, the development firm Savanna created a new lobby, repointed the facade and switched out a fast-food restaurant for an eyeglasses store and a bakery. But Savanna, which did not respond to a request for comment, apparently began to sour on the building’s financial prospects or the area. In 2021, it reportedly began marketing the property for $75 million, but after finding no takers, Savanna last month surrendered the keys to the Lee building back to its lender. Jazz saxophonist Ornette Coleman once had a studio in the building.

This three-story, window-lined structure in some ways represents an earlier effort to improve the block. In 2000, DDM Development and Services bought the site, a former parking lot, from the city for $427,000, according to the city register. Duane Reade and Seaman’s Furniture were the anchor tenants. And the fortunes of the 43,600-square-foot corner site quickly improved. When the next buyer, Thor Equities, picked it up in 2016, it paid $31.8 million, records show. But the last few years have been tough on the property. A 13,000-square-foot Modell’s Sporting Goods store on the second floor shuttered in 2020 when the retailer filed for bankruptcy, and the ground-floor Duane Reade closed in 2022. Today, No. 135’s only surviving store seems to be a small deli.

160 E. 125TH ST. The tundra-like sweep of empty land across this block-size site was the recent subject of a heated battle between the MTA and the luxury builder Extell Development. The MTA wanted the property, which once had a PathMark supermarket, for entrances for the next leg of the Second Avenue subway. But MTA officials were leery of taking the property by eminent domain because it could lead to court delays that could jeopardize project funding. So last spring MTA officials wrote a check to Extell and its chairman Gary Barnett for $82 million, more than 80% above what the MTA claimed the land was worth. Barnett reportedly still plans on developing a 15-story apartment tower at adjacent 167 E. 124th St. where a post office once stood.

1815 PARK AVE. The Park Ave. Hotel once stood at this address.

But the elegance suggested by the business’s name was a bit misleading for the rundown property. Tucked around it in recent years were a pawn shop, shabby delis and vacant storefronts. In a pair of deals in 2017, the year the city rezoned the neighborhood to allow for taller towers, the Durst Organization snapped up the hotel and two other sites, 1801 Park Ave. and 110 E. 125th St., for a total of $35 million, records show. But the MTA later came knocking, saying it needed to acquire the site for a new station for the upcoming extension of the Second Avenue Q line. Durst sued the MTA in 2021 for stymieing its plans, and the two sides settled the case in April 2023 for unknown terms, though the MTA now owns all three sites, which are devoid of buildings. And they may look like that for a while. The next subway leg is expected to take eight years to build.

120 E. 125TH ST. This gabled Romanesque landmark dates to 1889, when it was built as a firehouse. Napoleon LeBrun, who handled many similar designs across the city, was its architect. Originally housing Hook and Ladder Company 14, before becoming the home of Engine Company 36, this 25-foot-wide, four-story brick-and-stone structure apparently closed for good in the 1990s and sat abandoned for years. But in 2016, it reopened as a museum, the Caribbean Cultural Center African Diaspora Institute, which this month hosted a panel discussion that included thoughts on the year ahead from Lucumi priests of the Santeria tradition. There’s also gallery space for art exhibits. The nonprofit’s corporate donors include American Express, George Soros’ Open Society Foundations and the Durst Organization.

115 E. 125TH ST.

124 E. 125TH ST. For years, Apple Bank for Savings occupied this stately Beaux-Arts structure, which opened in 1907 as the Harlem Savings Bank, according to carvings on its stone facade. But in 2018, Apple transferred its deed to Dream, a Harlem charter school network helmed by Rich Berlin, who two years later sold the 21,600-square-foot property to developer Maddd Equities for $15 million, records show. In 2021, Maddd’s founder Jorge Madruga snapped up nextdoor 132 E. 125th St. for $11 million.

Madruga says he will raze both sites to make way for a 10,000-square-foot office building. But even though construction fencing is in place, the site does not yet have a demolition permit, and progress seems slow at a time when demand for offices has slackened.

This low-slung building, the Latin American Pentecostal Church, may be modest but was once much grander. In fact, when it was built in 1920, it was known as the Grand, a movie theater. The theater’s sign was bolted sideways onto the facade the same way a cross with the words “Iglesia Pentecostal” protrudes from it today. The church is nicknamed La Sinagoga, since it was originally based in the basement of a synagogue on East 109th Street, according to the Harlem Neighborhood Block Association, a 25-yearold advocacy group. According to tax officials, the 10,000-square-foot building has a market value of $895,000, though city estimates can be half of what properties actually sell for. In 2020, the site’s official value was $926,000, tax records show, suggesting a decline. Developers regularly seek to capitalize on church sites since they tend to be underbuilt relative to what their zoning allows.

BUCK ENNIS, GOOGLE MAPS

A

major crossroads in East Harlem at East 125th Street and Park Avenue finds itself at a symbolic crossroads, with a top landlord calling it quits and several nearby development projects appearing stalled.

Last month the firm Savanna handed over its keys to the Lee office building at 1825 Park Ave. to lender TPG in a deal valued at $56 million. TPG had most recently issued a loan of $54 million in 2019 for the 12-story building, which Savanna bought in 2015 for $48 million, records show.

It’s not clear why exactly Savanna pulled the plug. Messages left for the firm and TPG were not returned.

The 144,000-square-foot building appears to be almost completely occupied, with a mix of law firms, medical practices and retail banks, according to CoStar. But the neighborhood continues to suffer from some rough edges, including sidewalk drug use, residents say. And some long-planned developments from firms like Extell, Durst and Maddd Equities have not gotten much further than the demolition stage, they add, leaving blocks with a desolate look.

“People don’t want to pass these kinds of things on their way to work, and that makes it hard to find office tenants,” said Holley Drakeford, a Harlem-based commercial broker previously employed by Griscombe Realty Group, the firm that sold the Lee to Savanna. Drakeford also brought tenants to see the Lee during Savanna’s tenure.

“There are problems downtown too, but the problems here can seem magnified,” Drakeford added.

An amenity that’s supposed to improve the neighborhood may be paradoxically making it worse, at least in the short term. That’s the Second Avenue subway, which will eventually hook down 125th Street and meet up with the busy Metro-North station at 125th and Park as part of the second phase of the Q line’s construction.

Though the Metropolitan Transportation Authority appears to have finally acquired most of the sites it needs, it remains unclear if the new subway leg, which won’t open until at least 2032, will provide the same social impact as new apartment and office buildings.

And there may be further disruptions in store for other blocks. Gov. Kathy Hochul announced on Jan. 9 in her State of the State address that she hopes to extend the Q farther west on 125th Street in a new $8 billion project.

Yet at the same time, the neighborhood seems newly willing to confront its challenges head-on. Landlords are currently cementing plans to create a business improvement district for East 125th Street, which could add street cleaners and security officers.

“Everybody wants to see this area feel less chaotic, more healthy, more clean,” Carey King, director of the nonprofit beautification group Uptown Grand Central, told Crain’s this fall.

4 | CRAIN’S NEW YORK BUSINESS | January 22, 2024

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THANK YOU We are grateful to the New York brokerage community for your support in helping us lease over 1,029,000 SF in 2023.

Douglas Durst

Jonathan Durst

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1/17/24 12:07 PM

ON POLITICS

Albany should stop toying with NYC mayors and give them permanent control of schools

Renewing mayoral authority over the system has served as a political bargaining chip in the Legislature. It’s time to end that game.

I

What’s remarkable about this t’s an Albany tradition that needs to go away — the mayor moment is how a party switch in of New York City begging for Albany has reversed an ideologithe right to control his own public cal dynamic without changing reality on the ground. When Bill de school system.

Democrats in the state legisla- Blasio, a self-identified progresture are now threatening to yank sive Democrat, went to Albany, he mayoral control away from Eric was wrangling with a RepubliAdams, pointing to budget cuts at can-controlled state Senate that the city’s Department of Educa- would grant mayoral control only if he permitted charter tion and the mayor’s schools to expand in the wariness over funding a five boroughs. state-mandated reduction in class size.

If the city loses mayorLaw change al control, the school system will revert to its preThe GOP Senate, along 2002 status quo: with the centrist Demodecentralization and cratic governor at the elected school boards, time, Andrew Cuomo, with little ability from the Ross Barkan used mayoral control as mayor to implement leverage to extract conchanges or take accountcessions from de Blasio. A ability. decade ago, the state law was Adams has serious governing changed, at Cuomo and the Refailures and he is potentially the publican Senate’s behest, to force target of a serious federal corrup- the city government to find space tion investigation. There are argu- for charters in traditional public ments to make that he has not schools or pay the schools’ rent managed any bureaucracy well, elsewhere. including the sprawling DOE. Since mayoral control was such But Adams, even with his histor- a great bargaining chip for the Reically low poll numbers and publicans, it was only renewed in fraught relationship with a legisla- small, multiyear increments, and tive body he once served in, de- it took de Blasio teaming up with serves better. No mayor should old foes like Michael Bloomberg, have to keep begging the state to who won mayoral control two derenew a system that plainly works cades ago, to get any extension at well enough. all.

Now it’s the Democrats in the Assembly and Senate who are dangling the end of mayoral control, this time criticizing Adams from the left. Their concerns are valid; it would be good for the city to take seriously the task of cutting class sizes, hiring more teachers and giving students more individual attention.

But the teachers’ union and the Democrats aligned with them in the Assembly have never been fond of mayoral control. They don’t like the idea, necessarily, of a single schools chancellor, appointed by the mayor, dictating so much policy. They don’t like that the various community education councils, which are the equivalent of neighborhood representation, lack tangible power.

The answer, though, is not to vault backwards to the 1990s.

Though it’s taboo to say, there should be limits to how much parents and community members can decide when it comes to teaching or the state of the public schools themselves.

Under the old system, before mayoral control, quasi-politicians on the school boards were hiring and firing principals. Cronyism was far more rampant. To participate in education meant to be linked, in some form, to the local political machines. Bloomberg was smart and aggressive enough

Mark Twain Intermediate School in Coney Island | CREATIVE COMMONS

to end all of that.

It’s unlikely that Democrats, when push comes to shove, will fail to grant Adams an extension.

There’s a kabuki theater aspect to these negotiations, a way to keep forcing Adams to give the legislature what it wants.

Mayoral control should be made permanent. It was a waste of time for de Blasio to battle with the legislature over a renewal and it’s a waste, too, for Adams. If Democrats want to negotiate with Adams or apply pressure, they can do it in a more conventional manner. Toying with the structure of the schools themselves is misguided at best, destructive at

worst.

Quick takes ◗ Gov.

Kathy Hochul deserves praise for proposing to extend the Second Avenue subway from East Harlem across town, but the MTA must get smarter about controlling construction costs, or New Yorkers will never get the transit system they deserve. ◗ How exactly will Hochul prod the rest of the state to build more housing? With the legislature blocking growth mandates, localities will be able to stall as long as they want.

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

Controversial F-Factor diet creator sheds uptown condo for $24 million

By C. J. Hughes

A controversial dietitian and her developer husband have said goodbye to their Park Avenue duplex.

Tanya Zuckerbrot, who is locked in a court battle with some clients angry about alleged side effects from her high-fiber diet regimen while also fighting the Instagram influencer who helped spark the backlash to her F-Factor company, has sold her home at 515 Park Ave., public records show.

Zuckerbrot and her husband, Monday Properties Chairman Anthony Westreich, unloaded the five-bedroom condo, No. 27, for $23.9 million, a hair above the $22.5 million the couple shelled out for the property in 2019, according to the city register.

The buyer of the home, the sale of which closed Jan. 3, is Alison Bernstein, who is apparently an existing resident of 515 Park, based on contact information on the deal’s paperwork.

Spread across the 27th and 28th floors of 515 Park, a 1990s project from Zeckendorf Development,

the 6,500-square-foot apartment features five and a half baths, four exposures and a formal dining room, though exact details about finishes are unclear: Zuckerbrot and Westreich shopped around the apartment privately, so no recent marketing photos are available.

Legal turmoil The sale comes amid legal turmoil for F-Factor, which, according to court papers, was pulling in $1 million a month for its celebrity-endorsed powders and bars before influencer Emily Gellis rounded up and posted complaints about the products’ alleged health hazards due to overconsumption of fiber, the “F” in the company’s name.

After Gellis posted 4,500 allegations in 75 days, Zuckerbrot sued Gellis in fall 2020 for an attack that “has caused, and continues to cause, devastating financial damages and enormous emotional distress,” according to the complaint from that time.

Gellis, who has more than 200,000 Instagram followers, sub-

sequently countersued Zuckerbrot for trying to deprive her of her freespeech rights. Gellis added in court papers that though she “has never held herself out as a food and drug expert or investigator,” she felt compelled to address “health, wellness and safety issues of clear concern to the public” after receiving so many F-Factor complaints.

Later, in October 2022, eight women sued F-Factor for being “an ill-conceived and dangerous fad diet” that allegedly caused some customers to be “very sick, suffering from intestinal blockages requiring emergency surgery, debilitating gastric pain, disordered eating, severe allergic reactions, and other serious and permanent injuries,” as stated in their complaint.

Zuckerbrot has denied all the charges. Both cases continue to wind their way through Manhattan Supreme Court. A message left with F-Factor was not returned by press time.

Westreich, meanwhile, once owned a stake in Midtown’s historic Helmsley Building at 230 Park Ave. before RXR Realty picked up

515 Park Ave., No. 27, in 2019 | MODLIN GROUP

the office tower about a decade ago. Locally, other Monday Properties holdings have included office sites 350 Madison Ave. and 386 Park Ave. But with the office market struggling, the national company appears to be switching gears. In October Monday and partners bought an industrial site in Croton-on-Hudson in Westchester County, in the company’s first industrial deal.

Westreich’s father, Stanley Westreich, founded Westfield Realty, which in the mid-20th century developed office towers across suburban Virginia, including 1400 Key Blvd. in Rosslyn. Its parking garage was reportedly where the Nixon-era informant “Deep Throat”

Tanya Zuckerbrot and Anthony Westreich | GETTY IMAGES

met with Washington Post reporter Bob Woodward during the Watergate scandal.

Stanley Westreich sold that building and 11 other towers in Rosslyn and nearby to Beacon Capital Partners in 2005 for about $1 billion. A Monday spokeswoman had no comment on Anthony Westreich’s apartment sale by press time.

6 | CRAIN’S NEW YORK BUSINESS | JANUARY 22, 2024

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EDITORIAL

Mayor’s brighter budget outlook after grim predictions could ding his credibility F

inally, some good news: Mayor Eric Adams released a budget proposal Jan. 16 that reverses some of City Hall's earlier predictions about how paralyzing an effect the migrant crisis would have on the city's finances.

Although the plan would still impose an additional 5% reduction to the budgets of most of the departments he controls, Adams is exempting some agencies from the new decreases and only partially paring down the budgets of others.

The proposal showcases that the administration now has a sunnier outlook about the city's future than the mayor claimed to have mere months ago, when he cautioned that the costs of the migrant crisis could "destroy" the city. But this change in sentiment could dent the mayor's credibility with the federal government, as he lobbies for funding, and his constituents.

In an auspicious sign, projected budget gaps for fiscal years 2026 through 2028 have shrunken to a combined $16 billion, down from the $20 billion City Hall projected weeks ago.

As reporter Nick Garber found in his

look at the mayor's budget proposal, the cuts the mayor announced Jan. 16 appear milder than those imposed in November, amounting to $3 billion across five fiscal years compared with $3.7 billion in November. Many of the new decreases were achieved by re-estimating expected spending, rather than eliminating programs.

The governor’s proposed budget, also announced Jan. 16, commits to spending $2.4 billion on the migrant crisis in the coming year, on top of $1.9 billion it has already spent — appearing to promise the mayor much of what he had sought. So things are seemingly looking up for the city, except for on a couple of fronts.

Plea for attention?

The mayor's budget proposal pretty much concedes that the federal government won't be helping the city with the migrant crisis any time soon. Adams has tried on multiple occasions to gain the attention of President Joe Biden, and his “the sky is falling” predictions in the fall

were likely another stab at that.

But coming in hot with so much doom and gloom in what now appears to have been, if this current reversal serves as any indication, a plea for attention could turn Adams into the mayor who cried wolf in the eyes of the federal government.

What will happen if the need for federal funding actually turns dire? Will the Biden administration continue to turn a deaf ear to Mayor Eric Adams | MAYOR ERIC ADAMS ON TWITTER the city, feeling that the could shake things up by restoring some mayor may be prone to hyperbole?

In addition, the proposed cuts an- cuts, but the outlook for New York seems nounced in the fall contributed to the brighter than it did just months ago. Howmayor's approval rating plummeting ever, the mayor will have to weigh whether among voters, with many in a Quinnipiac this strategy — telling New Yorkers one poll saying they were "very concerned" by thing only to reverse the message later — was worth it, as it could make him seem the reductions.

The City Council, which needs to amend less trustworthy to voters and his fellow and approve the city's budget by June 30, elected officials.

PERSONAL VIEW

Construction worker misclassification harms us all

T

he construction industry grapples translating to an estimated annual cost to with a pervasive issue: misclassifi- taxpayers of up to $10 billion as employers cation. This is a practice used by un- avoid paying into Social Security, unemscrupulous employers that not only show- ployment insurance and workers’ comcases a reprehensible disregard for labor pensation.

In our home state of New York, the relaws but also poses a serious threat to the port estimates a significant 15.9% of the overall well-being of workers.

Misclassification takes place when com- construction workforce is misclassified, costing our taxpanies deliberpayers over $600 ately mislabel million annualworkers as indely. That’s hunpendent condreds of millions tractors instead of dollars that of employees, should be going allowing unethto building betical employers ter schools, supto skirt payroll porting critical taxes and evade employment re- Charlene Obernauer is the executive director of infrastructure, sponsibilities. The New York Committee for Occupational Safety improving our health system, Not only does and Health. Joseph Geiger, center, is the and so much this cheat work- executive secretary-treasurer of New York City more. ers, but it also District Council of Carpenters. Joseph Byrne is This exploithas significant the executive secretary-treasurer at North Atlantic ative practice ramifications on States Regional Council of Carpenters. also has severe law-abiding businesses, taxpayers and the broader consequences for the labor market. Workers are unjustly deprived of the employeconomy.

Recent research from the Century Foun- ment benefits to which they are entitled dation finds that an estimated 1.1 million while businesses that uphold ethical stanto 2.1 million construction workers na- dards find themselves at a disadvantage, tionwide were either misclassified or re- thus shrinking the market of good jobs.

The true extent of misclassification received off-the-books payments. This staggering figure accounts for up to 19% of the mains largely obscured because a considentire construction industry workforce, erable portion happens within an under-

ground economy. Employers engage in cash-only, off-the-books deals making it exceedingly difficult to identify and address the issue.

Misclassification isn't a standalone problem but part of a systemic issue that demands holistic solutions. Enforcement plays a pivotal role. In New York State, all employers who intentionally misclassify employees are subject to penalties, taxes and restitution.

But enforcement alone is not enough. Solving misclassification requires a 360-degree approach from city, state and federal officials Construction workers in New York City | BUCK ENNIS to stand up for workers’ rights and hold employers accountable. That in- the stakes for non-compliance. Furthercludes cracking down on wage theft, sup- more, the act would require certified payporting legislation like the Protecting the rolls – meaning that employers must proRight to Organize Act, and ensuring that vide weekly reports to prove they pay their all workers, even if they are classified as workers the prevailing wage — further deterring misclassification and wage theft. contractors, are protected.

Upholding legislation that unapologetiPrevailing wage laws, such as New York's Fair Share Act, also play a crucial cally stands up for workers’ rights, such as role. Though not directly addressing mis- prevailing wage laws, is critical. In 2024, classification, prevailing wage is a corner- our fight against misclassification must stone in the fight for workers' rights and persist. Let's stand tall, fight for justice, fair pay. The Fair Share Act, for instance, and ensure workers get what's rightfully mandates that construction workers on theirs. The future beckons — a future publicly subsidized projects receive a where we hold accountable those who standard wage and benefits, ensuring all exploit, champion the cause of hardworkers are paid what they deserve and working New Yorkers, and create a fair and discouraging misclassification by raising just playing field for all.

Write us: Crain’s welcomes submissions to its opinion pages. Send letters and op-eds of 500 words or fewer to opinion@CrainsNewYork.com. Please include the writer’s name, company, title, address and telephone number. Crain’s reserves the right to edit submissions for clarity.

8 | CRAIN’S NEW YORK BUSINESS | JANUARY 22, 2024

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PERSONAL VIEW

To build a stronger middle class, boost paid internships for CUNY students works. To change this status quo, more employers will have to step up and make CUNY a key part of their recruiting strategy — and city officials will have to do more to help CUNY meet employers halfway.

Rally employers First, Mayor Eric Adams and other top city officials should lead the charge to rally employers. The city should get behind CUNY’s current goal of tripling the number of students who land paid internships and partner closely with the private sector to achieve this.

Second, policymakers should work with CUNY to scale up the small but powerful programs that are already working — and help replicate them for other industries.

This should include expanding nonprofit partnerships like Project Basta and Break Through Tech, growing city-backed initiatives like the Tech Talent Pipeline Residency, and adapting programs like Futures in Finance for real estate, healthcare, professional services and other industries.

Third, CUNY should double down on ef-

BLOOMBERG

A

mid shorter days and colder tem- ways to bring CUNY students on board. peratures, it may feel like summer Our organizations have made it a priority is a long way off. But this is also the to recruit from CUNY in recent years, and season in which thousands of employers programs like Project Basta, CUNY Career across the city figure out their plans for Launch, Futures in Finance, Break Through Tech and the summer internships.

Tech Talent Pipeline This year, New York Residency are finding City leaders should pull success. out all the stops to enNow is the time to ralsure that far more of ly far more of the city’s those internships go to employers to recruit students at the City Unifrom CUNY for their inversity of New York. ternship programs — Most CUNY students and make it much easier come from families that for companies to do so. earn less than $30,000 Jonathan Bowles, left, is the Companies often annually, and paid in- executive director of the Center for struggle to navigate ternships could help an Urban Future. Winston CUNY’s 25 different colstudents channel their Fisher is a partner at Fisher leges, each of which opdegrees into career op- Brothers and CEO of Area15. erates with a high degree portunities and get on the path to the middle class. However, of autonomy. CUNY’s career services ofonly 10% of CUNY students report having fices are stretched thin, and employer ena paid internship during their time in col- gagement typically falls to just one or two lege. As a result, too many end up unem- staff members for a campus with thouployed or underemployed after gradua- sands of students.

Faced with too large a lift, even some of tion, limiting the effectiveness of CUNY as the most well-intentioned employers will an engine of economic mobility.

Fortunately, there’s a growing appetite revert back to past practices, such as reamong employers across the city to find cruiting through existing staff alumni net-

forts to make it easier for employers to partner with colleges. A new central, career-focused office could provide companies with a single point of entry, and CUNY should continue to add industry engagement specialists and employer-focused career services staff to foster long-term employer relationships. As part of this effort, the city should consider new ways to market CUNY to employers — similar to the omnipresent campaigns on the city’s subways and buses that market CUNY to prospective students.

Summer hiring is right around the corner — and the clock starts now.

PERSONAL VIEW

New York must confront liability concerns in fight against e-bike fires

R

When the next deadly fire occurs, who eports of devastating e-bike fires are growing all too common these days. will be left footing the bill?

Traditional homeowners’ and renters’ It seems a week does not pass without an apartment complex fire occurring insurance policies may present limited or a bike shop going up in flames after a coverage. Auto insurance companies, meanwhile, probably will not offer e-bike faulty battery exploded without warning.

The numbers bear out those fears. In insurance because e-bikes do not current2023, New York City endured 244 fires ly need to be licensed or registered and therefore do not qualify as motor caused by the lithium-ion battervehicles. ies that power e-bikes, e-scootMany carriers that insure bicyers, mopeds and hoverboards, cle retailers and repair shops also resulting in 17 deaths and 126 inare not comfortable with e-bikes, juries, according to the FDNY. By and understandably so. The same comparison, there were 30 batgoes for the FDNY, which has tery fires and zero related deaths been diligently inspecting faciliin 2019. ties that are selling, repairing and Yet our state and local governcharging perhaps dozens of dements are moving ahead with vices simultaneously. measures that could make this Michael P. Even with e-bikes maintaining problem even worse. While they Mezzacappa mass appeal due to their conveare trying to be sensitive to work- is a partner nience, insurance carriers are ers who utilize these devices, the and general hesitant to enter the fray because danger of unsanctioned devices counsel with outweighs their utility.

Coffey Modica. of the explosive risks stemming from the largely unregulated lithClearly, given the rash of e-bike and e-scooter fires, officials must directly ium battery market.

Lithium batteries, which also power confront inconsistencies in the lithium battery market (sales of new and recondi- electric vehicles and many handheld tioned batteries) before property owners tools, can be safe if produced under acare forced to embrace electric vehicle in- ceptable standards, but products that frastructure. Bringing more of these highly meet those standards are often expensive. flammable devices into buildings where With demand for affordable e-bikes and people live or work, while ignoring the e-scooters soaring, communities around root cause of the problem, is a myopic ap- the world have witnessed a flood of cheaply made batteries that overheat, explode proach.

and catch fire. Additionally, at the consumer level, end users often mix batteries and chargers from different manufacturers and may be increasing the odds of a fire exponentially.

An e-bike rider navigates city traffic. | BUCK ENNIS The FDNY Foundation recently hosted an event at Randall’s As a direct result, Amazon finally agreed Island for leaders in the fire safety and in- to stop selling non-UL certified batteries surance industries about the irrefutable to New Yorkers. dangers of lithium batteries. I was in atMany of these products, however, are tendance as firefighters and marshals de- manufactured by foreign entities that will scribed in jaw-dropping detail the unique not adhere to these standards, selling dannature of fires started by lithium batteries. gerous batteries and chargers that either The batteries do not smolder, which would ignore safety requirements outright or feaallow smoke detectors to give an early ture misleading labeling that leads conwarning. Instead, they explode, fed by a sumers to falsely believe they are UL-certiprocess called thermal runaway that fied. makes these fires burn much hotter and Until local efforts begin to make real faster than a typical blaze. They also burn headway on the battery problem, forcing for longer durations, even without nearby landlords to install charging rooms in combustibles present. multi-family buildings or parking structures may invite more disaster, wrongly leaving landlords exposed.

Local Law 39 E-bikes are not going away. Eventually, Some positive steps have been taken on insurance companies may provide more this issue. New York City’s Local Law 39, coverage, or building owners may end up which took effect in September, prohibits bearing the brunt of the property damage the sale of e-bikes and batteries that do and defending suits brought by personal not meet standards set forth by the Under- injury victims of such fires. The problem writers Laboratories or other standards needs more immediate and critical analyestablished in consultation with the sis before these batteries cause more harm.

FDNY. January 22, 2024 | CRAIN’S NEW YORK BUSINESS | 9

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City’s Department of Buildings still not doing enough to keep construction sites safe, state comptroller finds

By Nick Garber

The city’s Department of Buildings is still not doing enough to keep workers safe on construction sites and failed to implement reforms that could have tightened safety rules, according to a new review by state Comptroller Thomas DiNapoli.

After initially auditing DOB’s safety regulations in September 2022, DiNapoli’s office released a follow-up audit this month, shared exclusively with Crain’s, to see whether the department had complied with its recommendations in the ensuing year.

The watchdog’s office found that DOB had improved a handful of policies but failed to take action on others. For one thing, despite DOB’s insistence that it had met frequently with the federal Occupational Safety and Health Administration to keep abreast of construction site incidents, the department was unaware of five construction accidents that resulted in injuries between September 2022 and March 2023 “until we informed them,” the comptroller’s office said.

In another suggestion that went largely unheeded, the comptrol-

ler had called on DOB to create lists of high-risk construction sites that could be inspected proactively, using public data to identify contractors with histories of accidents or safety penalties. But while DOB gave examples of two instances in which it inspected high-risk sites in 2023, it still relies mostly on “due dates” rather than contractors’ safety records when deciding which sites to inspect proactively, according to the comptroller.

61% fewer employees DOB’s Construction Safety Compliance unit, which handles proactive inspections, also has 61% fewer employees than it did two years ago amid widespread vacancies in city government, the comptroller noted.

Reached for comment, DOB spokesman Andrew Rudansky said the agency welcomed the comptroller’s “continued focus on the issue of construction safety.”

Construction-related fatalities declined from 11 in 2022 to 7 in 2023, Rudansky noted, saying the agency will “continue using every tool at our disposal to promote safer work sites.”

DiNapoli also dinged DOB in his initial audit for not penalizing contractors who fail to show they have corrected unsafe conditions after receiving a summons. Although DOB’s policy is to issue a violation when contractors fail to submit such proof “in a timely manner,” the department had not issued violations for more than 60% of the 18,000 summonses for hazardous conditions that had been left open for more than 30 days as of August 2021, the initial report found.

Now, the comptroller says DOB has done little to change its policies. The department told DiNapoli’s office that it typically waits about 80 days before issuing a violation if a summons has received no response — a 3-month wait that the comptroller says “is not effective in ensuring compliance of time-sensitive conditions.”

Although a 2022 city law limited the department’s ability to issue some violations for one- to four-family homes, DOB can still issue violations at larger construction sites, the audit notes.

The comptroller credited DOB with taking some limited steps it had recommended, such as show-

In a follow-up audit, the state comptroller found that New York City’s Department of Buildings had improved a handful of policies but failed to take action on others. | BLOOMBERG

ing it meets regularly with OSHA to discuss recent incidents. DiNapoli said in a statement that he is “pleased that the Department of Buildings has taken some steps to address the concerns our previous audit raised, but it can do more.”

“It needs to hold contractors and property owners accountable for fixing dangerous construction sites that put workers, and the

public, at risk, and better use its data to identify those sites that are at risk,” he said.

The Department of Buildings conducted nearly 374,000 building inspections in the 2023 fiscal year, 6% more than the prior year, but issued 30% fewer violations and 18% fewer stop-work orders — a result of better compliance that the department attributes to its outreach campaigns.

NOTABLE LEADERS IN SUSTAINABILITY Nominate a leader who leads sustainability initiatives at an organization and makes an environmental impact.

NOMINATE BY FEB. 16 CrainsNewYork.com/ NotableNoms

10 | CRAIN’S NEW YORK BUSINESS | January 22, 2024

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Developer Alexandria Real Estate Equities unloads one of its two buildings in Long Island City at a loss

By C. J. Hughes

building to Alexandria.

A plan to transform an industrial corner of Queens into a life sciences hub may have run into a roadblock.

National developer Alexandria Real Estate Equities, the firm behind the Alexandria Center for Life Science in Kips Bay, has offloaded one of its two buildings in Long Island City at a steep loss five years after purchasing it.

The building, 47-50 30th St., a low-slung former printing plant that appears to have been vacant since the pandemic began, sold for $19.1 million Dec. 29 in a deal that appeared in the city register Jan. 11.

Alexandria, a publicly traded California company, had paid $25 million in 2019 for the site near Newtown Creek with the purpose of creating a “cluster” of science-focused tenants.

The deal came at a time when city and state leaders were dangling generous tax abatements and waivers to attract corporations to the neighborhood, the highest-profile among them being Amazon, which canceled plans to build a second headquarters in Long Island City after facing a harsh backlash over the associated tax breaks.

Stone Press

No. 47-50 30th St., a 52,500-square-foot site with truck bays, was Alexandria’s second purchase in the neighborhood. Its first, in 2018, was 30-02 48th Ave., a 179,000-square-foot former book bindery that cost $75 million and then underwent a major office renovation that added a bike room, a gym and a dark paint job.

But that building, which sports Alexandria’s lighthouse logo on its facade, may be struggling as well.

Two life sciences tenants are based there: Envisagenics, a firm that uses AI to study RNA, and RenBio, which develops antibody drugs.

But the 3-story Class A structure, whose rents average $30 per square foot annually, is about 70% vacant, according to the listings service CoStar.

Alexandria seems to have had better luck establishing industry-themed hubs elsewhere. Its 1.3 million-square-foot complex on East 29th Street, east of First Avenue in Manhattan’s hospital district, has 50 tenants across two towers, according to city figures.

And a third tower is on the way.

Meanwhile, the buyer of No. 4750 used a shell company, CM LIC Studios 30th Street II LLC, that has an address of an apartment in the Hamptons. John Shannon Jr. signed the deed on its behalf.

For years the building was home to the printing plant Prestone Press, which relocated from Brooklyn in 2006 with the help of tax breaks awarded by the city’s Industrial Development Agency.

But the paper-based business folded in 2019 before selling its

47-50 30th St., Long Island City | GOOGLE MAPS

CONGRATULATIONS TO THIS YEAR’S RECIPIENTS

OF THE NYC BUILDING & CONSTRUCTION INDUSTRY

SAFETY FUND AWARDS HONOREES

Second purchase

The next company to take up residence there was internet-marketing firm Stone Press, which appears to have come up with its name after lopping off three letters from its predecessor’s sign. But Stone Press is now based in Seattle, according to LinkedIn, and its employees all work remotely, says its website.

Alexandria could not be reached by press time. And messages left with the Long Island City Partnership, the economic development agency that coordinates the tax breaks for relocating life sciences businesses, were not returned. An email sent to Alexandria’s Pasadena office also went unreturned.

On Jan. 10 Alexandria’s stock closed at $129 a share, below its 2021 peak of more than $122 a share and also lower than its prepandemic levels.

CNY GROUP

Safety Guardian Award

DISTRICT COUNCIL 9 IUPAT Training Sentinel Award

NYC DEPARTMENT OF BUILDINGS Public Sector Champion Award

STRUCTURE TONE

John T. White Leadership Safety Award

Since its establishment in 2017, the NYC Building & Construction Industry Safety Fund has focused on providing support to the families of those construction workers tragically killed on the job.

This year we launch a new program dedicated to enhance training, education, on-site safety and public awareness.

The annual CONSTRUCTION INDUSTRY SAFETY AWARDS will acknowledge those leaders in our industry who have made the sacred commitment to worker and public safety.

Gary LaBarbera John O’Hare

Co-Chairmen

January 22, 2024 | CRAIN’S NEW YORK BUSINESS | 11

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PEOPLE ON THE MOVE

Advertising Section 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

CONSTRUCTION MANAGEMENT

ENGINEERING

LAW

LAW

LEGAL

JRM Construction Management

Loring Consulting Engineers, Inc.

Belkin Burden Goldman, LLP

Cullen and Dykman LLP

Thompson Coburn LLP

JRM Construction Management, a leader in the construction industry, is pleased to announce the appointment of Cecil House as the Vice President of the Public Sector division. With a distinguished career spanning over two decades, Cecil brings a wealth of experience and a proven track record of success, having managed public sector projects valued at over $1 billion.

Cecil holds an MBA from Columbia and a JD from Harvard Law School, establishing a solid foundation in operations and real estate.

Oneil Gayle has been promoted to Chief Executive Officer of Loring Consulting Engineers, Inc. Oneil joined the building systems and technology infrastructure design firm as an intern in 2002 and built an exceptional career, becoming Chief Operating Officer in 2016. He championed Loring’s expansion into new sectors, created and ran the Energy Services and Commissioning Group, and expanded the New York City-based firm’s presence to nine offices in the U.S., Canada, and the Caribbean.

Belkin Burden Goldman, LLP, a NYC based real estate law firm, proudly announces the elevation of Brian Bendy Bendy and Israel A. Katz to Partner in their Litigation Department, recognizing their outstanding Katz contributions to the firm and its clients, noteworthy decisions, and overall accomplishments.

Messrs. Bendy and Katz both possess significant litigation experience in New York State and Federal Courts, encompassing a broad range of real estate related matters.

This includes disputes in connection with commercial leasing, complex real estate joint ventures, title issues such as ownership, priority, and boundary disputes, construction and related financing, as well as condominium and cooperative management and constructionrelated issues.

Specializing in private equity M&A and distressed debt restructuring, Joseph Spina joins Cullen and Dykman as a Partner in its expanding Corporate Department. Advising on over $50 billion in aggregate deal volume throughout his career, Joseph brings his versatile expertise to further expand the firm’s transactional capabilities in a promising deal market. He has been a trusted advisor to global corporations, family and founder owned businesses, investment firms and other blue-chip institutions.

Jose Fernandez and Brigitte Rose have been promoted to partner with Thompson Coburn LLP in New York.

Fernandez Fernandez is a litigator with extensive experience in financial services, complex commercial, securities, lender liability and Rose insolvency-related matters. He served as a law clerk to the Hon. Eileen Bransten in the Commercial Division of New York State Supreme Court, New York County, and to the Hon. Claire C. Cecchi, United States District Judge for the District of New Jersey.

Rose’s practice focuses on complex commercial litigation, including breach of contract claims, business torts, fraud, creditor priority disputes, foreclosures and judgment enforcement proceedings.

She also has experience in bankruptcy litigations.

CONSTRUCTION MANAGEMENT HEALTH CARE

Shawmut Design and Construction.

Shawmut, a $1.6 billion construction management firm, appointed Paul Praylo to its board of directors. With a proven track record in directing financial and business operations for global firms, Praylo brings expertise that will enhance the board’s oversight during Shawmut’s robust national expansion. His experience aligns with strategic growth plans, focused on increasing share of large, complex projects in New York and its unwavering commitment to delivering a better building experience.

VNS Health As of February 1st, John J. Burke joins VNS Health serving as Executive Vice President, Chief of Health Plans.

Mr. Burke brings 25 years of executive-level healthcare experience to his new role, much of it focused on serving low-income, elderly, and immigrant populations. Prior to VNS Health, Mr. Burke served as CEO of SOMOS Innovation, where he led the introduction of Innovator, a full-risk, delegated health plans model that grew to support over 100,000 Medicaid members across 600 primary care physicians during its first two years of implementation.

Sixteen years with WellCare of New York, seven as president, preceded SOMOS.

CRAIN’S NEW YORK

Tap into New York.

Crain’s is now in the app store.

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Vinson & Elkins Stephen Josey has joined Vinson & Elkins’ Tax and Executive Compensation & Benefits practice as Counsel in the firm’s New York office. He has extensive experience litigating tax controversies in federal courts including tax refund suits, summons enforcement matters, collection actions, and bankruptcy disputes.

LEGAL

Belkin Burden Goldman, LLP

Thompson Coburn LLP

Anthony Morreale has been promoted to Partner with Belkin Burden Goldman, LLP, a New York City based real estate law firm, in recognition of his outstanding contributions, strategic thinking, and clientcentric approach. Mr. Morreale advises landlords, owners, property managers, and developers on a wide array of regulatory issues, with a focus on Rent Stabilization.

He represents clients facing regulatory status challenges, rent overcharge claims, and performs transactional due diligence.

Liz DiMichele has joined the New York office of Thompson Coburn LLP as counsel in the labor and employment practice. She negotiates and drafts employment-related agreements and counsels employers on areas including anti-discrimination practices, reasonable accommodations, wage and hour issues, reductions in force, restrictive covenants, hiring practices, termination decisions, and personnel policies. She also defends clients in litigation, arbitration, and government agency proceedings.

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12 | CRAIN’S NEW YORK BUSINESS | JANUARY 22, 2024

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THE CONVERSATION

Curaleaf’s CEO on why partnerships matter for New York’s nascent weed industry

A

s of mid-December, Curaleaf Holdings was one of six licensed medical marijuana companies in New York to receive the formal green light to begin recreational operations by the end of the month. It’s a milestone that many smaller operators in the Empire State have been nervously watching, with fears that they won’t be able to compete with the multistate operator and its peers.

But running the competition into the ground isn’t on Curaleaf’s agenda, CEO Matt Darin told Green Market Report last month. Rather, it’s local partnerships that the MSO is hunting.

This interview has been edited for length and clarity. | By John Schroyer, Green Market Report Tell me about what Curaleaf has planned for the New York cannabis market, now that the company has gotten formal approval to launch there.

We’re gearing up to serve the wholesale market. We’re one of a couple of companies that have built out significant capacity, just like we’ve done in other markets, like New Jersey and other places.

We’ve had people working overtime packaging product, and we’ve got a lot of great new dispensaries that are eagerly awaiting shipments from us.

And getting our first store open, right when the launch happens, we’re looking forward to that as well. So New York is going to go from a big challenge, or big negative, to a positive here as we get into 2024.

The brand license, it’s kind of a unique, interesting concept to really encourage a lot of the United States brands and the entrepreneurial brands to come in. And, and so it’s going to be interesting to see how it plays out. We’re talking to a lot of these different groups about working together.

We’re hoping to start shipping wholesale orders out of our large facility outside of Albany within a handful of days after (approval for recreational operations, which happened Dec. 8). There’s some question whether it’ll happen the next day, or if it’s going to be shortly thereafter. But longer term I think that’s going to be the biggest opportunity with the many hundreds of dispensaries that are going to ultimately open up in New York and the big backlog of ones that are waiting to get open now.

There’s huge demand for highquality, tested goods in New York.

So we’re expecting that, knock on wood, in the next handful of weeks.

On the retail side, Dec. 29 (was) technically the first day you could possibly open that first adult-use site. Our site is in Newburgh, so a little bit north of the city, which we’re really excited about, a great regional location, very successful medical dispensary, that we’re going to be adding adult use there.

You’re limited to three retail locations, correct?

Yes, three adult-use retail.

Does that connect to what you just said about the wholesaling being a better business opportunity in New York?

just totally different.

But it is going to require the will of governments and law enforcement to prioritize enforcing this. There are ways to do it that can be successful. Going after landlords that are knowingly allowing these businesses to operate this way is one way to do it, which they have started to do.

Assessing significant fines, and really making it a moral hazard to be operating this way.

There’s ways that it can be done.

And we’re cautiously optimistic.

Of course, it’ll continue to be there, but having it be so brazen and so unsafe (isn’t sustainable).

This is not about corporate cannabis. That is a recipe for disaster. And we’re lucky that there haven’t been more incidents, but that’s the role of the regulated market.

Curaleaf is one of six licensed medical marijuana companies in New York to receive the green light to begin recreational operations. | BLOOMBERG

Matt Darin | CURALEAF

We’re excited about the having three of those retail stores, but in a state of 20 million people and hundreds of dispensaries, ultimately, having three adultuse dispensaries is only going to give you so much there. So the opportunity to sell into hundreds of other retail dispensaries on the wholesale side is going to be a very big opportunity.

The R.O.’s in New York, like Curaleaf, have become sort of a boogeyman for many of the smaller businesses. What are your thoughts on how the New York market is going to develop and how much market share Curaleaf will be able to capture?

The way that the licensing structure has been set up for this adult-use program, with the license caps on the number of retail stores and the cap on canopy size for the R.O.’s, the reality is, the market is not going to be set up for any one or a handful of companies to truly own the majority of the market. That wouldn’t even be natural for a market that’s going

to be the size of New York, which could be $5 billion-$6 billion over time.

This is part of why we tried to reach out to all the different stakeholders, because it has been unfounded, I think it’s been backwards. The reality of how this can and should work is that it’s one ecosystem of a regulated market. And there are different roles to play, different people

through, co-branding products with local farmers to get their names out there, there’s a lot that can be done. That’s how we look at it, that there’s a lot of win-win partnerships to be had, not that it’s us-versus-them.

And the biggest point: Our competitors are not the regulated players, whether it’s the R.O.’s or hemp farmers or CAURDs. The competitor is the illicit market.

And in New York, it’s become so out of control.

The city council said up to 8,000 storefronts selling illegal unlicensed (marijuana). That’s the competition.

But it’s going to take time to get that horse back in the barn, and so it’s going to take some real will to make that happen.

“New York is going to go from a big challenge, or big negative, to a positive here as we get into 2024.” with different business plans and different situations, but there’s a symbiotic relationship.

For companies like Curaleaf, we have the ability to do a lot of good for a lot of people in the market, for these dispensaries that we’re now selling into, many of which are entrepreneurs and are just getting started up. Our ability to work with them, to supply them, to offer payment terms that work for them, to use our marketing platforms and education platforms, there’s a lot of good that we can be doing with them.

Buying oil from the farmers that have so much product that they’re now going to be working

How hopeful are you that New York is going to be able to rein in the unlicensed market? Or do you think that it’s going to wind up turning into a replica of California, where the unlicensed market has 70%-80% market share?

I think there’s some differences in the profile of the New York market versus California. It’s just a different situation where the amount of land they have to cover and the kind of pre-existing supply of unlicensed product is

I’m just skeptical looking at New York, primarily because of my experience, personally and professionally, in California with how they’ve been trying and failing for years to replace the illicit market with a legal market.

Your skepticism is very fair.

There’s a reason we pulled out of California; it’s that exact reason. It was not a place for us to successfully operate.

New York has some different characteristics. There’s not nearly the legal supply anywhere. There’s going to be an under-supply for some period of time of good, indoor-grown flower, of really good vapes and edibles and concentrates and everything else. It’s a different business dynamic, but long term, how big is that market going to get in the regulated market versus the illicit?

It’s, we’ll see what happens over time.

I’m feeling a little bit better today, because now New York is moving forward, but we’ve been as frustrated as anybody with what’s taking place, because what’s happened in California. Once you allow that to happen, it’s really hard to get the genie back in the bottle. It requires a lot of attention, and ultimately, resources and money to go make that happen.

Again, it’s got to be a priority for the people in power to do something about it. Is it a priority that they want to expend resources on?

In part one of this interview, Darin addressed the company’s broader strategy to achieve profitability.

This article originally appeared in Green Market Report.

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NewYork-Presbyterian’s Allen Hospital to end midwifery services

By Amanda D'Ambrosio

NewYork Presbyterian’s Allen Hospital in Inwood plans to halt midwifery services on March 3, the hospital confirmed.

Midwives were first notified about the closure in early December, according to the New York State Nurses Association. It’s unclear how long midwifery services will be shut down or whether the hospital plans to restore them.

“We are evolving our perinatal care model and care teams at NewYork-Presbyterian Allen Hospital,” said Angela Karafazli, a spokeswoman for the health system. She said the system’s focus is “increasing access to the highest standard of care, including the best and most experienced clinicians, for the benefit of our patients and Northern Manhattan community.”

Karafazli said the plans are part of a “broader commitment and investment that will enhance perinatal services” at Allen Hospital now and in the future.

But midwives say they were caught off guard by the decision, and have been pushing for clarity

on the status of midwifery services and continuity of care for their patients.

“We are still very baffled as to why this happened in this way,” Alison McDonald, a certified nurse midwife at Allen Hospital and NYSNA member, told Crain’s.

McDonald said that clinical leaders had a meeting with midwives in mid-November, proposing to expand their scope of practice. Midwives at Allen primarily triage patients and provide postpartum care, but leadership stated that they wanted to broaden their service to include labor management, she said.

Just a few weeks later, McDonald and her colleagues received letters from the hospital stating that their jobs were being eliminated by Feb. 1 of this year. The hospital has since extended the cutoff date to early March.

Six certified nurse midwives and one nurse practitioner will lose their jobs as of March 3, McDonald said. Currently, the midwifery team assists with 200 births a month, she added.

“We are understaffed to begin

NewYork-Presbyterian’s Allen Hospital in Inwood plans to shut down midwifery services on March 3. | COLUMBIA UNIVERSITY

with, but we are making do,” McDonald said. “Taking away seven people, you are asking for a disaster.”

Statewide health crises The health system did not respond to questions about whether it plans to bring back midwifery services at Allen Hospital in the future, nor how it will preserve patient care after the closure.

Plans to halt midwifery care at

Allen come amid statewide maternal and infant health crises — crises that disproportionately impact people of color. Black mothers in New York are five times as likely to die from pregnancy compared to white mothers, according to Department of Health data released in 2018, the most recent year available. Black babies are nearly three times as likely to die than white babies.

State officials have renewed their attention on the maternal and in-

fant health crises, with Gov. Kathy Hochul proposing this month to make New York the first state to offer prenatal medical leave.

But McDonald said that shutting down services only worsens the situation for mothers and infants, especially at a hospital like Allen, which cares for a large population of Medicaid enrollees. “It feels like it’s creating a crisis,” she said.

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14 | CRAIN’S NEW YORK BUSINESS | January 22, 2024

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In another surprise restoration, mayor undoes cuts that would have removed 9,000 litter baskets

By Nick Garber

Mayor Eric Adams is undoing budget cuts that would have removed thousands of litter baskets and ended a popular park-cleaning program: His second surprise funding restoration in two days, and one that carries clear political benefits.

Money restored to the Sanitation department will prevent the removal of some 9,000 litter baskets — 40% of the city’s total of 23,000 — that had been mandat-

schools that saw painful cuts.

Additional cuts were detailed on Jan. 16 in Adams’ preliminary budget for Fiscal Year 2025, although police, fire and sanitation were spared.

The funding restored Jan. 11 amounted to $31 million, while the police and fire restorations announced on Jan. 10 totaled $37 million — both paltry sums compared to the $3.7 billion in cuts announced in November. Although officials now say that cost-cutting on migrant spending has given the administration more flexibility than it anticipated in November, the restored money may also show the mayor recognizing the political costs of funding cuts that could leave the city filthier and with fewer police officers patrolling the streets.

Jacques Jiha, Adams’ budget director, conceded on Jan. 11 that last week’s restorations were a drop in the bucket compared to the full sum of November’s cuts and the city’s entire $107 billion budget.

“When you look at these restorations, this is small stuff compared to the whole picture,” Jiha said. “The mayor’s priorities are a safe and clean city, so we have to juggle . . . we reallocate them to where his priorities are.”

The DC37 union praised the mayor’s decision in a statement but did not give any indication it would drop its lawsuit filed in December. The suit focused on certain cuts in the Parks Department,

“This latest move to restore litter basket services and the Parks Opportunity Program only reinforces the fact that these and many other mid-year cuts were unnecessary.”

— Council Speaker Adrienne Adams and finance chair Justin Brannan ed in Adams’ mid-year budget cuts announced in November.

And restorations to the Parks and Social Services departments will allow for the revival of the Parks Opportunity Program, a longstanding job-training initiative for low-income New Yorkers whose planned demise had spurred the municipal labor union DC37 to sue the Adams administration.

The Jan. 11 announcement came the day after Adams revealed a similar budget reshuffling benefiting the police and fire departments, although no relief appears to be in sight for other agencies like libraries and

Mayor Eric Adams restored about $31 million he had planned to cut from the Sanitation, Parks and Social Services departments, his second surprise restoration in two days. The Jan. 11 announcement came a day after the mayor disclosed a similar budget reshuffling benefiting the police and fire departments. | ED REED/MAYORAL PHOTOGRAPHY OFFICE/FLICKR

including the job-training program, which it alleged had been carried out without a legally required analysis.

The mayor took time to praise DC37’s leader, Henry Garrido, on Jan. 11 as “a strong leader for our city” and implied that Garrido’s feedback had informed the decision to restore funding.

Migrant crisis cost City Hall now says the migrant crisis will cost some $10 billion through next fiscal year — less than the $12 billion estimate it has trumpeted for months. But Ad-

Mayor Adams’ November cuts would have especially reduced litter baskets in outer-borough residential neighborhoods — far from an ideal policy for a mayor whose strongest support lies in Eastern Queens, Central Brooklyn and the Bronx.

The administration did not pledge to undo other November cuts to the Sanitation department, like the elimination of a unit that cleans vacant lots, a hiring freeze for civilian jobs, and the phasing-out of a $15 million program that focused on cleaning neglected areas like park perimeters and bridge entrances.

ams’ turnabout has already bolstered claims from the City Council that his cuts were excessive and arbitrary.

“This latest move to restore litter basket services and the Parks Opportunity Program only reinforces the fact that these and many other mid-year cuts were unnecessary,” Council Speaker Adrienne Adams and finance chair Justin Brannan said in a statement on Jan. 11. “The Council will continue to push the administration to accurately budget, restore its most harmful cuts, and take a different approach that prioritizes vital services for New Yorkers.”

KSR takes 49% stake in Midtown South office building The building is 92.6% leased, with major tenants including manufacturing company 32 Degrees, entertainment firm WSC Sports and Broadway Chiropractic & Wellness, according to CoStar.

By Eddie Small

1410 BROADWAY

COSTAR

Investment firm KSR Capital has purchased a 49% stake in the office building at 1410 Broadway in Midtown South, the company recently announced. The deal valued the building at $170 million.

The property spans about 400,000 square feet and stands 34 stories tall. Developer L.H. Charney Associates, which is keeping a 51% stake, owns and operates it. Charney recently completed major renovations at the building, including modernizing its lobby, common areas, restrooms and elevators.

WeWork used to have a major presence in the building. The coworking firm announced a lease for 45,000 square feet in April 2019, just a few months before its botched attempt at an IPO. Charney ended this lease shortly before WeWork filed for bankruptcy protection in November, although COO Joseph Giannola described the tenant whose lease was terminated only as “a large coworking firm” in a state-

ment.

The building is 92.6% leased, with major tenants including manufacturing company 32 Degrees, entertainment firm WSC Sports and health care firm Broadway Chiropractic & Wellness, according to

commercial real estate database CoStar. A new tenant in the wholesale apparel industry also just inked a 62,500-square-foot lease at the building, but a KSR Capital representative declined to name the company.

KSR Capital is the investment arm of Abraham Kassin’s and Morris Sabbagh’s Kassin Sabbagh Realty, a commercial real estate firm based at 1385 Broadway, just steps from its recent purchase. The firm recently represented RJF Re-

alty in its sale of the nearby commercial building at 110 W. 32nd St. to MediaWill and Tony Park for $37 million.

Charney is a development firm founded in 1981 by the late Leon Charney. The firm also owns 10 Times Square, where it is headquartered. The company has owned 1410 Broadway since at least 1984, property records show.

January 22, 2024 | CRAIN’S NEW YORK BUSINESS | 15

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Museum of Chinese in America pays about $51.1 million to buy its Lower Manhattan home at 215 Centre St.

By Eddie Small

The Museum of Chinese in America has purchased its home of roughly 15 years for about $51.1 million, property records show.

The museum, which was founded in 1980 and focuses on documenting Chinese American history, bought its building at 215 Centre St. in Chinatown from a firm called Grand Machinery Exchange, property records show. It received a roughly $39.4 million mortgage from the city as part of the deal.

Grand Machinery Exchange, a firm that sells industrial equip-

noted that it would have left the city earlier if the family did not own “the Centre Street building and an even larger warehouse nearby on Baxter Street.”

A representative for Grand Machinery Exchange could not be reached for comment. Representatives for the city and the museum did not respond to requests for comment by press time.

Larger space The museum had been located at 70 Mulberry St. but launched a capital campaign in 2006 to support its move to Centre Street’s larger space. It officially opened at 215 Centre St. three years later, according to its website.

The organization kept its collection of more than 85,000 artifacts at 70 Mulberry St. but suffered a devastating blow in January 2020, when a fire broke out at the building, although officials were able to salvage many of the pieces.

One of the current exhibits, which opened Dec. 6 and runs until May 26, is called Five Senses of Chinatown. It aims to capture

The Museum of Chinese in America is hosting a Feb. 17 festival to celebrate the Lunar New Year. ment, moved from Lower Manhattan to Long Island in the mid2000s, according to a 2006 article in The New York Times. The piece framed the company as one of the last vestiges of Manhattan’s “once robust machinery district” and

215 Centre St. | COSTAR

“the unique character” of the famed Manhattan neighborhood using artwork from local students,

historical artifacts and interactive sensory stations, according to the museum’s description. The muse-

um is also hosting a Feb. 17 festival to celebrate the Lunar New Year.

16 | CRAIN’S NEW YORK BUSINESS | January 22, 2024

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Meet New York’s real estate families

COHEN BROS. owns nine Midtown office towers, most of them built around 40 years ago and many struggling to retain tenants. The firm controls 12 million square feet of space across the country.

THE DURSTS have been one of the most prominent New York real estate families for more than a century. Their namesake company, the Durst Organization, owns more than 13 million square feet of office and retail space in Manhattan and about 3 million square feet of residential rental space with roughly 3,400 apartments, along with thousands more in the firm’s development pipeline.

The Cohens

The Dursts

The Elghanayans

The Goldmans

The Malkins

The Perezes

The Roses

The Rudins

RELATIVE P A look at 14 of the city’s most influential and newsworthy clans | By C. J. Hughes

PHOTOS: BLOOMBERG, BUCK ENNIS, GETTY IMAGES, KARJEAN LEVINE, NEWSCOM

I A COIN FLIP orchestrated in 2009 to avoid succession tensions in the family carved up the mostly residential-focused Elghanayan portfolio into two separate companies helmed by different siblings: Rockrose and TF Cornerstone. Between the two of them is a portfolio spanning more than 25 million square feet of apartments, office towers and retail spaces, including more than 20,000 rental units, primarily in parts of Manhattan and Queens that were not popular places to live for years. That means their land came cheaper than in established areas, even though those neighborhoods can seem quite established today.

REAL ESTATE FAMILIES earn their billions differently. In the case of the Goldmans, who might have had the most meteoric rise of the bunch — co-patriarch Sol Goldman went from buying run-down Brooklyn tenements to becoming the city’s largest private landlord in a short four decades — a key strategy is to buy land, let other developers build on it in exchange for pricey rents and never, ever unload. But the Goldmans also own loads of traditional real estate, including apartment houses, retail sites and office buildings, sometimes several properties in a row and located in every borough but Staten Island.

for record-setting condo prices as for messy family n New York, real estate runs in the family.

At a level that appears unmatched in the rest of spats; and the Walentases, who bet that a derelict inthe country and perhaps also overseas, huge dustrial area under the Manhattan Bridge had potenswaths of the landscape in the city are under the tial as an affluent Brooklyn enclave.

Also turning up is the Malkin family, of Empire control of a web of fathers and daughters, grandpas State Building fame, who were pioneers of a different and grandsons, second cousins and ex-wives.

Mirroring New York’s rise as a destination for im- sort, mastering the art of the “everybody chips in migrants and a hub of an easy-debt lending culture, something small” approach known as a syndication family real estate dynasties have surged in stature and deal.

The tree with the deepest roots may be the Dursts, influence since the early 20th century after starting courtesy of tailor Joseph Durst, who arrived in 1902 out in some cases with a single storefront.

In fact, as some firms embrace their fourth from what was then Austria (today Poland) and after generation of leadership — the LeFraks, Rudins and about a decade had purchased his first site, a dress Dursts­— the families rival longtime players like shop on West 34th Street. But longevity doesn’t always beget harmony; a jury in recent years convicted Trinity Church and Columbia University.

But don’t expect these dynasties, whose portfolios Robert Durst, an heir to the family fortune, of murder.

More standard-issue include office towers in divisions, over divorces or the Financial District, lines of succession among supertall luxury condos children, have rocked on Billionaires Row and families such as the Elmodest retail offerings in ghanayans, the Macklowthe Bronx, to always call es and the Silversteins, attention to their reach, though the Goldmans which often includes an may take the cake for their outsize role in politics. drawn-out and vitriolic That they cash your rent court fights. check is sometimes the But Crain’s deep dive is only way to know they’re — Owen Gutfreund, Hunter College professor in some ways inherently there. subjective, since it can be “The people who run the big banks and financial institutions are well hard to know who exactly owns what.

For one, the city’s top real estate families mostly known and visible, which leads people to mistakenly believe that’s where all the power in New York lies,” operate as private companies, so they have no formal said Owen Gutfreund, an urban planning professor at oversight from the Securities and Exchange CommisHunter College who also once worked on Wall Street. sion or other watchdog groups. On paper, the firm SL “But the power is really in the hands of the big real Green Realty Corp. is considered the city’s largest office landlord, and its holdings are a cinch to verify beestate families who fly under the radar.” cause the company is publicly traded and, thus, subject to reporting requirements.

From dresses to shells But New York’s privately held real estate families In order to create some transparency, Crain’s has have to provide addresses only voluntarily.

Likewise, if investors own a minority position, their profiled 14 of New York’s most prominent and newsworthy real estate families, chronicling their ascent, stakes often don’t turn up in public records, though owning buildings outright doesn’t always clear things deal-making and stumbles along the way.

Crain’s list spans the Cohens, which imbued much up.

Many landlords buy properties using limited liabilof Midtown East with its sleek corporate look; the Macklowes, who have been in the spotlight as much ity companies, totally legal mechanisms that allow

“The people who run the big banks and financial institutions are well known and visible, which leads people to mistakenly believe that’s where all the power in New York lies.”

18 | CRAIN’S NEW YORK BUSINESS | January 22, 2024

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purchasers to shield their true identity. Gov. Kathy Hochul, whose policies generally favor the real estate industry, weakened legislation in December that would have unmasked LLCs, so no change on that front is expected soon.

Though many firms contacted for this article did confirm details about their holdings, some never responded, which seems to speak to the industry’s penchant for privacy.

Major impact Beyond campaign contributions, there’s a main reason real estate families have the ear of lawmakers and leaders: They help keep the machinery of government humming.

Indeed, property taxes on apartment buildings, office towers and the like currently account for a hefty 43% of total city tax revenue, according to the Independent Budget Office, or about $32 billion of $73 billion.

Of course, scions of property dynasties shape civic life in ways that other wealthy residents do too. They have donated wings for museums, such as the Rose family with the Center for Earth and Space at the American Museum of Natural History. And they work to maintain and improve city parks. Eric Rudin, for one, serves on the board of the Central Park Conservancy.

But their power extends much further than to just green spaces and planetary displays.

Starting around Union Square in the 1980s, analysts point out, the families and others have established a long line of business improvement districts, which award taxing powers to landlords to help them preserve and enhance property values. Landlords pool their money for sanitation and security services that benefit their real estate, which in turn has created microgovernments for some blocks.

“BIDS are a way for real estate owners to create their own powers and exert them at the expense of any broader community notions,” Gutfreund said.

THE KUSHNERS have been players in the New Jersey and New York residential and commercial markets for 40 years. But the biggest stories around this family often have little to do with real estate.

THE LEFRAKS and their namesake company, known simply as LeFrak, have been synonymous with middle-class housing in New York for decades thanks in large part to their LeFrak City development in Queens, although they have lately branched out into more luxury-style buildings in markets including Miami, Seattle and Jersey City. The company’s main focus is on office and residential properties, but it also invests in retail and hospitality properties and has investments outside of real estate as well in energy, securities and private businesses.

Missing faces The Crain’s survey does not purport to be the end all and be all. Some once-prominent families have become largely absent from the scene. The Milsteins, for example, have seemed to focus mostly on philanthropy since developing their last empty parcels at Battery Park City more than a decade ago.

Similarly, the Trump family, which built but then sold off many condos under the leadership of Donald Trump, appears to be waning in influence. During Trump’s controversial presidency, residents of some Trump-developed buildings along Riverside Boulevard removed his name from facades, for example, and Attorney General Letitia James is now trying to slap a lifetime real estate industry ban on him amid his business fraud trial.

Also, other families, though powerful, do not seem particularly multigenerational, such as the Chetrits, whose holdings have included the Sony Building, the Chelsea Hotel and rental high-rises in Jamaica, Queens.

The high degree of family control seems to set New York apart. In places such as Boston and Philadelphia, real estate investment trusts control dozens of residential and commercial buildings: firms like Equity Residential and AvalonBay Communities, for example.

For its part, Los Angeles does have a handful of established family players, including the Watt and Roski clans, for instance, in a newish metropolis that really took off after World War II. Third-generation firms are generally rare.

Of course, the royal family very prominently controls much of the real estate in the United Kingdom.

But besides having a different kind of government, London also enjoyed a head start of several centuries on New York in terms of building out its cityscape, so a comparison does not seem totally apt.

The city, then, is a breed apart.

Here is a look at 14 of the most noteworthy and powerful real estate industry families in New York.

SEE ONLINE: Crain’s has profiled 14 of New York’s most prominent real estate families.

To read the entire package visit CrainsNewYork.com/RealEstateFamilies

WHEN YOU THINK about New York real estate soap operas, epic family feuds and dizzying rises and falls, Harry Macklowe and his brood come to mind. During his career, Harry has faced off with his son, who runs a rival firm, and taunted his ex-wife. There have also been resident complaints at his infamous supertall along Park Avenue, along with lawsuits and barbs from other developers.

TONY MALKIN’S family has been a major real estate player since his grandfather and a partner teamed up to acquire the Empire State Building more than 60 years ago. Today Tony is chairman and CEO of Empire State Realty Trust, a publicly traded company that owns 8.6 million square feet of space, mostly in Manhattan, mainly in older Midtown office buildings and particularly the landmark tower that symbolizes New York.

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FOR YEARS parts of the Bronx suffered from a reputation as being places where buildings were more likely to fall apart than be constructed. But three generations of the Perez family have invested as if the borough’s future has always been bright. The family-held company, Mastermind, has developed low-slung retail sites, midrise affordable housing complexes and no-nonsense office buildings. Today Mastermind appears to control 1.5 million square feet in the borough as well as parts of Upper Manhattan, though the family owns properties in New Jersey, Pennsylvania and Westchester as well.

THE ROSE FAMILY has been an active investor in commercial real estate in the city since the 1920s, when the two Rose brothers founded Rose Associates in the Bronx. The company manages a portfolio of approximately 26,000 apartments in the city and has expanded into Westchester and as far north as the Catskills. Outside of real estate development, the family is known for its donations to Lincoln Center, the American Museum of Natural History and Yale University, which several family members have attended.

THE RUDIN FAMILY, through its namesake real estate firm, Rudin Management Co., owns and manages a portfolio of nearly 15 million square feet of residential and commercial space in the city. The firm has been involved in assisting the city government in staving off insolvency in 1975 and expanding the New York City Marathon to all five boroughs.

SILVERSTEIN PROPERTIES owns and operates 16 million square feet of commercial and residential space around the country. Its portfolio includes 30 Park Place, a downtown residential skyscraper, plus 120 Broadway, 120 Wall St., 1177 Sixth Ave. and two residential towers at 600 W. 42nd St. It also famously owns several towers at the World Trade Center.

DAVID WALENTAS founded Two Trees Management, the family firm, in 1968, and it has amassed a real estate portfolio worth more than $4 billion. The company currently manages more than 3 million square feet of office and retail space in the city, along with more than 4,000 market-rate and affordable apartments. The firm and the family are most famous for being the driving forces behind transforming Dumbo into the ritzy Brooklyn waterfront neighborhood it is today.

“BOOM, BUST, BOOM, BUST” could describe the Zeckendorf family’s real estate fortunes, although with each peak, they seemed to soar above the previous one. With a knack for finding suitors for unloved stretches of land — William Zeckendorf Sr. convinced the United Nations to take a chance on a row of unsightly East River slaughterhouses — the family significantly shaped modern-day New York. But they don’t have a lot of existing real estate to show for it. A build-and-sell as opposed to a buy-and-hold type of dynasty, the Zeckendorfs have tended in recent years to construct luxury condos, whose units they sell off — for $1.7 billion, in the case of 15 Central Park West — before moving on.

Profiles by Aaron Elstein, C.J. Hughes, Mario Marroquin and Eddie Small

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SLICKBRANDS LLC filed Arts. of Org. with the Sect'y of State of NY (SSNY) on 9/20/2023.

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Notice of Formation of Foreign Professional Limited Liability Company (PLLC) Name: CamSolutions LLC dba Woligo LLC. Application for Authority filed by the Department of State of New York on: 11/14/23 Jurisdiction: Oklahoma Organized on:4/24/20 Office location: County of New York. Purpose: Any Lawful Activity.

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Notice of Qualification of 500 SUMMIT AVENUE LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 12/05/23.

Office location: NY County. LLC formed in Delaware (DE) on 12/14/17. Princ. office of LLC: 520 Madison Ave., Ste. 3501, NY, NY 10022. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to Corporation Service Co., 80 State St., Albany, NY 12207-2543, regd. agent upon whom and at which process may be served. DE addr. of LLC: 1209 Orange St., Wilmington, DE 19801. Cert. of Form. filed with Secy. of State, Div. of Corps., John G. Townsend Bldg., 401 Federal St., Ste. 4, Dover, DE 19901.

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BUDGETS From Page 1

stronger-than-expected tax revenues and his administration’s own pared-down migrant spending had left the city in far better fiscal shape than it had feared.

It marked a stark difference from last summer and fall, when Adams warned repeatedly that the migrant crisis could “destroy” the city. A third spending cut long expected in April may even be canceled if the state provides enough aid, Adams said.

“We balanced the budget without unduly burdening New Yorkers with tax hikes or massive service reductions and without laying off a single city worker,” Adams said in a City Hall speech last week.

The state has until April 1 to finalize a budget — a deadline that Albany leaders often blow past — while the city budget must be passed by July 1.

Migrant aid helps stabilize city’s finances Hochul’s promised migrant aid, which includes $500 million that she decided to draw from the state’s emergency reserves, appears to mostly satisfy the city’s hopes. City Hall officials had said they would press the state to pay for about one-half of total migrant expenses, which are expected to total $10 billion through mid2025. (The state has already spent about $1.9 billion).

Both the mayor’s and governor’s budget proposals are still subject to negotiations with the City Council and state Legislature, respectively. Some lawmakers at the

state level are expected to push for tax hikes on the wealthy in the coming weeks, something Hochul said she considers a non-starter.

City Council members, meanwhile, have seized on the mayor’s reversals as evidence that his cuts had been unnecessary in the first place. City Hall’s new tax forecast is $3 billion higher than what it had predicted last year, and higher even than what had been projected by the City Council, whose forecasts tend to be less conservative.

Council Speaker Adrienne Adams and the council’s finance chair Justin Brannan said in a statement Tuesday that the city needed “a better approach to budgeting that is based on a more accurate and shared set of facts.”

“It is counterproductive for New Yorkers to needlessly fear dire threats to essential services they rely upon when so many are struggling through an inequitable recovery,” they said in a statement.

Adams’ administration has countered that its November cuts are a major reason the city’s financial picture has improved, along with a national economy that has escaped a recession.

“There’s nothing mysterious about what happened,” Adams’ budget director Jacques Jiha said Tuesday. “We changed our forecast because of the fact that we are in a position of soft landing instead of a recession.”

Although Adams had expressed a rare openness in recent weeks to raising property taxes, his Fiscal 2025 budget proposes no tax hikes.

The city will also not ask state lawmakers to raise other kinds of taxes on city residents, such as income taxes.

The administration managed to

drive down its own migrant spending by reducing the number of services provided at migrant shelters and the number of staff working there, Jiha told Crain’s in an interview last week. The city also made room for new arrivals by compelling more migrants to leave shelters — mainly through its caps on shelter stays imposed starting last summer, which, while controversial, have stabilized the city’s sheltered migrant population at around 69,000 people. Meanwhile, the city has renegotiated the rates it is paying to for-profit vendors that staff migrant shelters, and plans to seek cheaper nonprofit vendors to operate more large-scale relief centers.

Medicaid savings, 421-a replacement Hochul’s budget mostly added detail to the proposals already unveiled in her State of the State speech earlier this month, such as extending and replacing the 421-a tax break for new housing, funding 200 new psychiatric inpatient beds and continuing the Second Avenue subway further west along 125th Street.

The new version of 421-a, dubbed 485-x, would put the onus on New York City officials to determine the affordability levels that a new rental housing development must meet to qualify for a 35-year property tax break, or 40 years for homeownership projects.

And although Medicaid costs were expected to rise by 11% in the coming year due to the state’s aging population, Hochul’s budget outlined long-term plans to curb Medicaid spending — which exceeded projections by $1.5 billion this year, she said. Over the last three years,

Medicaid spending in New York has increased by 40%.

The governor-appointed Commission on the Future of Health Care and the state’s Master Plan for Aging have been tasked with improving the state’s long-term care sector, which has become “by far the fastest growing area of health care,” Hochul said.

The executive budget also aims to fulfill Hochul’s promise Gov. Kathy Hochul presents the Fiscal Year 2025 to improve access to mental Executive Budget | GOVERNORKATHYHOCHULOFFICE/FLICKR health care, building on the $1 billion multi-year investment the bill would not automatically lower governor announced last year. The the city’s speed limit but merely state has increased its mental give the city the power to alter it health investments by 45% since without a go-ahead from the state.

2022, with fiscal year 2025 spend- Support for the bill appeared roing projected to reach $10.9 billion. bust at the start of last year’s sesThe 200-bed expansion for psy- sion but ultimately fizzled. chiatric inpatient care would cost Hochul also reaffirmed her the state $55 million in the coming commitment to public transit with year. The governor also committed a slight boost to the Metropolitan to expanding access to housing Transportation Authority’s coffers. and homeless services for people Under Hochul’s budget, the agenwith mental illness, including $43 cy is poised to receive a 3.4% inmillion for supportive housing crease in traditional in-budget asunits and $37 million for street sistance from $4.1 billion to $4.2 outreach programs for the home- billion. Overall, the MTA would less population. receive $7.9 billion in state operating aid in Fiscal Year 2025, including funds from taxes collected by Funding boost for the MTA the state on behalf of the authoriFor the second year in a row, the ty. That’s an 11.5% jump compared governor will use the budget pro- to the previous fiscal year.

The state would also spend $16 cess to try to pass legislation that would allow New York City to set million on a feasibility study of its own speed limits. The measure Hochul’s proposal to extend the is long-sought by transportation Second Avenue Subway to West advocates and is a version of “Sam- Harlem, which would ultimately my’s Law,” named after 12-year- cost an estimated $8.1 billion. Adold Sammy Cohen Eckstein who in vancing design and engineering 2013 was struck and killed by a for the Interborough Express — the proposed light rail line bemotorist near his Brooklyn home.

As it stands now, state lawmak- tween Brooklyn and Queens — ers must give the city permission would cost $45 million in the to lower its own speed limit. The coming year.

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HEALTH BUSINESS SPOTLIGHT

CrainsNewYork.com President and CEO KC Crain Group publisher Jim Kirk (312) 397-5503 or jkirk@crain.com Publisher/executive editor Frederick P. Gabriel Jr. Editor-in-chief Cory Schouten, cory.schouten@crainsnewyork.com Managing editor Telisha Bryan Assistant managing editors Anne Michaud, Amanda Glodowski Director of audience and engagement Elizabeth Couch Audience engagement editor Jennifer Samuels Digital editor Taylor Nakagawa Opinions: opinion@crainsnewyork.com Director of visual media Stephanie Swearngin Creative director Thomas J. Linden Associate creative director Karen Freese Zane Digital design editor Jason McGregor Art directors Kayla Byler, Carolyn McClain, Joanna Metzger Photographer Buck Ennis Notables coordinator Ashley Maahs SENIOR REPORTERS Aaron Elstein, C.J. Hughes, Eddie Small REPORTERS Amanda D’Ambrosio, Nick Garber, Jacqueline Neber, Caroline Spivack CONTACT THE NEWSROOM editors@crainsnewyork.com www.crainsnewyork.com/staff

CEO Brad Olson joined Sollis in 2022. | BUCK ENNIS

Concierge urgent care firm looks to expand its locations and services to reach more New Yorkers Sollis Health, founded in 2016, offers on-demand visits for an annual membership fee | By Jacqueline Neber

B

rad Olson was diagnosed with multiple sclerosis in late 2016. His treatment included drugs that suppress his immune system, which led him to get “hit pretty hard” with Covid-19 in 2021, landing him in the emergency room.

“Ultimately [getting] a 30-minute monoclonal antibody infusion to treat my Covid required a ninehour visit to a New York ER,” said Olson, the chief executive of ondemand urgent care company Sollis Health since 2022.

His lengthy experience receiving a simple treatment is exactly the problem Sollis, which has a flagship location on the Upper East Side, was built to overcome.

The firm was co-founded in 2016

by Ben Kruger and Andrew Olanow. Kruger is the son of Dr. Bernard Kruger, who had conceived the idea for the company after noticing a hole in the on-demandcare market for urgent and emergency services. The doctor thought that although on-demand primary care was growing in popularity, patients had fewer options in an emergency, and patients’ ER experiences were often subpar, Olson said.

In the past eight years, Sollis, which has raised $53 million since its founding, has grown to encompass four locations in the city, one in Water Mill on Long Island and several between California and

Florida. When a patient steps into a clinic, they can get on-site advanced imaging and expedited access to specialists; the company also partners with hospitals and works to arrange access to direct admissions and faster operating times. Sollis hires physicians who are trained to handle emergency room cases, Olson said.

Membership fee Access to these services doesn’t come cheap: Membership begins at $1,500 per year for those 18 and younger and increases by age to $6,000 for people over 45 — and Sollis doesn’t take insurance.

Olson says the prices are worth it.

“We bring to bear a different skill set, different experiences,” he said. “We really do aim to supplement what other concierge medicine providers are doing. And I think what speaks to that most convincingly is the fact that a very significant portion of our members join on the referral of their primary care doctor.”

Physician practices that require patients to purchase a membership in exchange for premium care are not new in New York.

Companies staking their claim in the space include One Medical and Elitra Health. Sollis aims to complement those primary carefocused practices — not compete with them, Olson says.

Olson is at the helm for the company’s next phase, which includes opening more sites — a Boca Raton location is slated to launch by the end of January following success in Palm Beach — and adding more services to each clinic’s repertoire.

In the past year, Sollis has rolled out virtual dermatology consultations and smart cardio monitors that virtually assess patients for arrhythmias and other heart conditions. Going forward, the company aims to partner with more health care providers across specialties, Olson told Crain’s.

National Medical Director Dr. Scott Braunstein adds that concierge medicine is already a more than $6 billion industry in the U.S. And though he refers to Sollis' pricing as a "fantastic value," he said the company aims to make its services more accessible to more people going forward.

The company’s goals align with what Olson sees as key elements of the future of concierge care in New York: growth, exceeding patient needs, which he calls providing “11/10 service,” and faster access to care for busy New Yorkers.

“With broader trends of health care moving more toward private pay, cash pay and concierge-level services, we're excited to be part of that continued growth here in New York,” Olson said.

FOCAL POINTS Company name: Sollis Health Founded: 2016 Full-time employees: Approximately 220 Locations: The firm recently opened a facility at 945 Fifth Ave. on the Upper East Side, its fifth in the state and second in the neighborhood.

It plans to open its next site on the west side of Manhattan and will announce the exact spot this spring.

Corporate headquarters: Midtown Leadership: Ben Kruger and Andrew Olanow are the co-founders. The executive team includes CEO Brad Olson, National Medical Director Dr. Scott Braunstein and COO Jia Jia Ye; the medical side includes Braunstein and a medical director for each state in which the firm is located, as well as care navigators.

Funding: Sollis raised a $15 million Series A extension in June. Olson declined to share projected revenue for 2024.

The company has raised $53 million since its founding.

Membership: The company has more than 17,000 members nationwide.

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