Crain's New York Business, February 26, 2024

Google opens huge Hudson Square site as it closes others

St. John’s Terminal gives the company a total of nearly 6 million square feet locally.

By C. J. Hughes

e stylish new o ce building that Google opened last week in Hudson Square is proudly forward-thinking.

Mostly native plants grace its acre and a half of gardens, and interior space is equipped with cutting-edge, hybrid-work technology.

1.3 million square feet, but the single-tenant address allocates more than 400 square feet of space for each of its 3,000 workers. Even when considering that some of the building is used for amenities, the allotment seems steep. e average space-to-worker ratio for years has been a lean 150 square feet.

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I try to apply, and I can’t get through.

Maria Tyner

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New MWBEs struggle for the city’s attention as established rms, often run by white women and Asian men, land most deals.

Two days and a few miles apart, two very di erent sides of New York City’s minority- and women-owned business world were on display earlier this month: one in a stu y Bronx conference room and the other at a swanky breakfast inside Gracie Mansion.

In the Bronx, dozens of business owners led into a room at CUNY’s Hostos Community College, where they hoped to meet city o cials who might one day award them sought-after contracts. Mayor Eric Adams’ admin-

istration organized the event, which drew exactly the kinds of people his o ce is trying to reach: entrepreneurs who had only recently become certi ed as “Minority- and Women-owned Business Enterprises.” ey came with plenty of complaints about how di cult it remains to do business with the city, including that agencies don’t seem open to new faces and don’t respond to inquiries.

It was a di erent scene two days later at the mayor’s Upper East Side residence, where an

By | Nick Garber

MWBE reception brought together some of the city’s most successful entrepreneurs of color — including New York’s top 20 MWBE vendors, with contracts adding up to some $3 billion combined. at crowd had nothing but praise for Adams, a mayor who is seen as business-friendly and has set ambitious goals for increasing the city’s contract spending on MWBEs — namely, to double it to a cumulative $60 billion between 2023 and 2030.

But as a real estate play, the 12-story tower at 550 Washington St., called St. John's Terminal, which swells Google’s already massive city o ce portfolio to nearly 6 million square feet across seven Manhattan sites, seems to hark back to the past.

Conceived years ago, when bosses still required employees to be in the o ce daily and before a brutal ad market began pummeling tech companies, the site has been unveiled at a time when parent company Alphabet is eliminating jobs, breaking leases and shaking up its real estate team.

Not only is St. John’s large, at

And Alphabet's recent corporate strategy would seem to frown on large, new o ce buildings. Globally in 2023, Alphabet spent a hefty $1.8 billion on “exit charges,” or fees to get out of leases at some o ces, as property costs seem to weigh on executives’ minds.

“We continue to execute the other workstreams to slow expense growth,” said Ruth Porat, Alphabet's president and chief investment o cer, during the company’s January earnings call, with “optimizing our real estate portfolio” as a goal.  e company declined to

Google’s new of ce building at 550 Washington St. in Hudson Square BUCK ENNIS

Related Companies’ $12 billion Hudson Yards casino bid includes 3

skyscrapers, offices and 1,500 apartments

Documents filed with the city reveal the developer’s long-awaited proposal for a West Side casino complex

By Nick Garber

The developer Related Companies’ proposal for a Hudson Yards casino would entail three skyscrapers, an office tower and more than 1,500 units of housing to be built on a platform above the undeveloped Western Rail Yards — amounting to a $12 billion investment, according to plans filed with the city last week.

Related is gunning for one of the three downstate casino licenses set to be awarded by the state in the coming months, partnering with Las Vegas hospitality giant Wynn Resorts. Related CEO Jeff Blau has been clear about his interest in one of the lucrative gaming licenses, but his company has been among the last of the region’s 11 likely bidders to hold off on detailing its plans.

That changes with the documents filed Feb. 20 with the City Planning Department, which have not been previously reported. The three buildings would be spread across the 13-acre rail yard site along the Hudson River between West 30th and 33rd streets, consisting of the casino, a residential building, a hotel-resort, 2 million square feet of offices, a public school and a day care. Like many of its rival casino proposals, Related’s plan would be contingent on

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winning the license, meaning the developer would likely drop the three-tower plan if it is unsuccessful.

The casino building, spanning 2.7 million square feet, would be built on the lot’s north side at the corner of West 33rd Street and 11th Avenue. Standing 80 stories and 1,200 feet tall, it would contain a 1,750-room hotel, ballroom and conference space, retail and restaurants, all standing atop a fivestory “podium” containing the casino.

A 1,400-foot office tower would occupy the site’s southeast corner and also include a 750-seat public school. The southwest corner, finally, would become home to a 1,200-foot-tall apartment building with 1,507 units, including 324 that would be set aside as affordable. About 6 acres of public open space would span the area in between the new towers.

makes the whole development “viable.” (The planning documents spell out an “alternative scenario” showing how the development could be built without the

In addition to its main application with the state, Related has the extra hurdle of filing this plan with the city because it is seeking to change the terms of the 2009 rezoning that allowed them to develop Hudson Yards. Whereas that original deal called for six buildings atop the still-undeveloped Western Rail Yards, Related is trying to reduce the number to three but make the towers taller and denser — although the public school and affordable housing, promised to the community as part of the 2009 rezoning, will remain the same.

$12 billion investment

Related spokesman Jon Weinstein said in a statement that the casino development would be a $12 billion investment, pricier than Steve Cohen’s rival $8 billion plan for the site next to Citi Field — widely seen as one of the other most ambitious downstate proposals.

“We are excited to continue engaging with stakeholders across the local community as part of the city land-use process for the undeveloped railyards,” Weinstein said. “As the state’s parallel process moves forward, we look forward to unveiling our full proposed plan which will provide thousands of jobs, billions in revenue and community benefits, a new park, affordable housing, a school and more.”

Weinstein said Related would be unlikely to pursue the same project without the gaming license, saying that component

“We look forward to unveiling our full proposed plan which will provide thousands of jobs, billions in revenue and community benefits, a new park, affordable housing, a school and more.”

Jon Weinstein, Related spokesman

casino, but Weinstein said that scenario was only included as a procedural step.)

Like the other casino proposals, Related’s faces a murky political future. Brad Hoylman-Sigal and

Tony Simone, who represent Hudson Yards in the state Senate and Assembly, have both expressed deep skepticism toward casinos in their districts, and each proposal must win majority support from local elected officials to even have a chance of securing a license. Local officials may also object to Related’s attempt to change the 2009 rezoning, which was only agreed upon after a yearslong political struggle.

Weinstein and Wynn spokesman Michael Weaver added that the project will come with a notyet-revealed community benefits agreement, which it will submit

along with its full application later this year.

Applications for the licenses are expected to finally open later this year after a sluggish run-up. In the coming weeks, the state’s Gaming Facility Location Board will publish answers to a second round of questions that applicants have posed about the process; after that, full applications will be due within 30 days.

From there, the state will convene the six-member Community Advisory Councils to review each casino proposal — with the power to sink any bid if it receives fewer than four votes. The CACs will be made up of lawmakers who represent each proposal’s neighborhood, as well as the mayor and governor or their representatives.

Any bids that advance past the committees will reach the threemember Gaming Facility Location Board, whose members will award up to three licenses after considering each project’s potential for economic development and a few other criteria.

Separately, Mayor Eric Adams’ administration is trying to advance a zoning change that would complement the state process by bringing the future casinos in line with the city’s own zoning code. The proposal would put no restrictions on casinos’ size and also allow “related” uses like hotels that are otherwise restricted in the city, which has given rise to some opposition as the zoning plan faces community boards’ scrutiny as part of its public review.

Related’s project site is just a few blocks away from another prominent casino bidder: Silverstein Properties, which is envisioning two 46-story towers between West 40th and 41st streets east of 11th Avenue.

Kathryn Wylde Rob Speyer

Plans show the Related Companies’ proposal (inset) for a casino development on the western half of Hudson Yards, including an apartment tower (beige building), casino-hotel and office tower. RELATED COMPANIES

Vornado’s latest Penn Station pivot calls for tennis courts, fashion shows and a 10-story billboard

The developer has given up on replacing the former Hotel Pennsylvania with a supertall office tower, at least for now.

By Aaron Elstein and C. J. Hughes

On its website, Vornado Realty Trust describes plans for developing a 56-story, 2.7 million-square-foot office tower on the site of the now-demolished Hotel Pennsylvania.

Called Penn 15, the building would provide a “quality experience rooted in authentic New York,” a brochure reads, and create “a workplace experience that is within the essence of NYC to help draw employees back to office.”

But with demand for office space muted and financing all but impossible to secure, Vornado has pivoted. Instead of a supertall tower, the developer is now planning to turn the former hotel site into an 80,000 squarefoot space for U.S. Open tennis matches, New York Fashion Week events, and a digital billboard measuring 10 stories high.

A spokesman said Vornado is considering “a number of potential interim options” for the Hotel Pennsylvania site and the renderings, which have been shared with city officials, are “for conceptual purposes.”

Vornado has secured approval from the

state to redevelop the area around Penn Station and, although plans for 18 million square feet of new towers are on ice, the firm could move quickly with the outdoor space.

“If the development proceeds in line with what was approved,” said Casey Berkovitz, a spokesman for the Department of City Planning, “it doesn’t require any further review or approvals by the city.”

“If the development proceeds in line with what was approved, it doesn’t require any further review or approvals by the city.”

Casey Berkovitz, a spokesman for the Department of City Planning

A spokesman for the Hochul administration’s economic development arm, Empire State Development, didn’t immediately respond to a request for comment.

The outdoor space, which they’ve dubbed Penn Platform, takes up about half of the block between Sixth and Seventh avenues, and West 32nd and West 33rd streets. A brochure says “the Penn Platform offers brands

a unique opportunity for activation space on New York City’s newest stage.” Vornado saw the site as a potential landing spot for a casino before withdrawing those plans. Renderings show the outdoor space being used for New York Fashion Week and U.S. Open tennis matches; four tennis courts can apparently fit in the nearly two-acre space. Representatives for Fashion Week and the U.S. Open didn’t immediately reply to a request for comment.

But its dominant feature would be a Times Square-style billboard measuring a hefty 150 feet high by 197 feet wide. While other large LED signs cast glares on the intersection — two that formerly flanked the hotel’s entrance remain at the site, while their owner Silvercast also owns lofty bill-

boards across the street — the size of what’s proposed seems unprecedented for the immediate area, a fact that has apparently upset some local leaders.

Roth enthusiastic about area

Indeed, the new sign would span the entire distance from West 32nd to West 33rd streets and cover the entire back side of 100 W. 33rd St., a prewar office-and-retail complex that contains the remnants of the shuttered Manhattan Mall. The sign’s operator is unknown. An email sent to Silvercast was not returned by press time.

Whether a sport that prides itself on hushed crowds stands a chance against the din of Seventh Avenue traffic remains to be seen.

But Vornado CEO Steve Roth remains enthusiastic about the Penn Station area, describing it during an earnings call Feb. 13 as “a game changer.” Roth added, “if you are a shareholder of Vornado, or are interested in Vornado, this is an immediate must-go-see.”

Former Revlon CEO lists his Upper East Side 6-bedroom condominium for $10.5 million

Jack Stahl, also a former president of Coca-Cola, paid $8 million for the home in 2009.

By C. J. Hughes

Aformer chief executive at Revlon is hoping buyers take a shine to his uptown condo.

Jack L. Stahl, who ran the cosmetics giant from 2002 to 2006, has listed his six-bedroom home on the Upper East Side for $10.5 million. It came on the market Feb. 15.

$10.5M

No. 21A at 255 E. 74th St, which has three exposures, an eat-in kitchen with banquette seating and a 460-square-foot combined living and dining room, cost Stahl $8 million in 2009, when developer World Wide Group completed the 30-story, glass-walled tower at Second Avenue.

Despite some predictions a few months ago that the Fed’s move to hold the line on interest rate hikes would energize home markets, nudging more sellers to list, the expected surge in inventory does not yet seem to have materialized, at least based on StreetEasy listings. The fact that rates on 30-year fixed mortgages are hovering above 7%, about where they’ve been for months, may explain some of the sluggishness, even though some New Yorkers are going the all-cash route.

The unit has three exposures, an eat-in kitchen with banquette seating and a 460-square-foot combined living and dining room.

The nearly 4,000-square-foot unit also appears to be one of the few high-priced homes to be unveiled this winter that’s not part of a newly built project or merely back on the block because it’s switched brokerages.

Stahl has enjoyed runs atop two major American corporations. He joined Revlon in 2002, when the beauty-products firm was mired in debt, and was ousted in 2006  after failing to execute a turnaround. He also had a series of high-profile roles at Coca-Cola over more than two decades. After joining the softdrink company in 1979, he became its youngest-ever chief financial officer in 1986 before later ascending to the position of president and chief operating officer. He left the Atlanta-based

company in 2001. Stahl was in the upper ranks in 1985 when, in the face of stiff competition from Pepsi, Coke decided to tweak the longtime recipe for its signature product and promote a sweeter beverage known as “new Coke” instead. But consumers greeted the soda with a fierce backlash that ultimately led to the retiring of the product and years of fodder for business-school lectures about the risks of messing with well-established brands.

Coke, obviously, managed to shrug off the misfire; today it controls almost half of the global non-alcoholic beverage industry.

Currently the chairman of the Boys & Girls Clubs of America, Stahl could not be reached by press time. And Patricia Parker, the agent with Sotheby’s Interna -

tional Realty who is marketing his home, did not respond to a request for comment by press time.

Billionaires Row developer sued over alleged private-jet debts

By Eddie Small

Michael Stern’s JDS Development Group, famous for its luxury residential skyscrapers in Brooklyn and Manhattan, is facing a new lawsuit accusing it of owing about $1.3 million in expenses related to a private plane.

The suit, filed earlier in February in Manhattan state Supreme Court, says that JDS leased an Embraer Legacy 600 jet from a former Hawthorne Finance Holdings subsidiary from May 2017 to at least June 1 of last year. The developer used the plane for trips to destinations including the Bahamas, Italy, Florida, Arizona, Nevada and Georgia, according to the lawsuit.

ExcelAire, the former Hawthorne subsidiary, was responsible for repairing the jet, dealing with regulatory agencies and providing supplies, personnel and services, according to the lawsuit. The firm would provide JDS with monthly statements for all revenue and expenses related to the plane, but JDS did not pay these bills between October 2022 and

May 2023, racking up a total unpaid balance of roughly $1.3 million, the suit claims.

Hawthorne sold its interest in ExcelAire in June but is still entitled to collect on any remaining outstanding debts, according to the lawsuit, which was first reported by The Real Deal. The firm started talking with JDS about the debt during the summer and fall of 2023, and Stern said in mid-September that JDS “should be on track” to send a proposed payment plan in a matter of days, according to emails filed with the lawsuit. He then wrote on Dec. 5 that JDS would send a good-faith payment and start processing the balance, but Hawthorne did not receive any payment, the suit claims.

Demand letter

On Dec. 10 Hawthorne CEO Tyson Goetz emailed Stern requesting $500,000 from JDS the next day and another $500,000 by the following Friday based on “the size of the undisputed amount,” court documents show. The firm

then sent JDS a Dec. 21 demand letter requesting payment within seven days, but JDS has yet to respond to the letter or send Hawthorne any money, according to the lawsuit.

Hawthorne is suing JDS for charges including breach of contract and unjust enrichment. It is

requesting the roughly $1.3 million it is allegedly owed plus interest.

Representatives for Hawthorne and JDS did not respond to requests for comment by press time.

Stern’s JDS Development is behind some extremely high-profile projects in the city. These include

the luxury residential projects Brooklyn Tower in Downtown Brooklyn, which has been touted as the borough’s tallest building, and 111 W. 57th St. on Billionaires Row, which the firm bills as the “most slender skyscraper in the world,” reportedly at about 60 feet wide and about 1,400 feet tall.

A lawsuit accuses Michael Stern’s firm JDS Development of owing about $1.3 million in private jet-related expenses. | BUCK ENNIS/WIKIPEDIA

255 E. 74th St., No. 21A, Upper East Side | SOTHEBY’S INTERNATIONAL REALTY

The entry hall | SOTHEBY’S INTERNATIONAL REALTY

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New York Democrats should resist temptation to tinker with state’s districts again this year

Pushing to redraw congressional maps yet again would bene t Democrats, but not democracy

It’s the obscure, very important political saga that never quite ends.

New York’s Independent Redistricting Commission this month agreed on new proposed maps for the state’s congressional districts.

e districts were redrawn in 2022 and, thanks to a court challenge, this will be the second time in two years that they are refashioned.

e commission’s maps don’t vary much from the current lines:

e greatest changes are upstate, where two incumbents — Republican Marc Molinaro and Democrat Pat Ryan — would see modest boosts to their re-election odds while another Central New York district, held by GOP freshman Brandon Williams, would become more Democratic.

current House districts.

Je ries might very well get his way. Democrats are desperate to retake the House and have a clear pathway through New York, where Republican incumbents are highly vulnerable on Long Island and in the Hudson Valley. Tom Suozzi recently ipped George Santos’ old district on the North Shore of Long Island.

e bipartisan commission overwhelmingly approved the new maps. Now it will be up to the Democrat-run state Legislature to rubber-stamp or reject them. Hakeem Je ries, the House minority leader and a Democrat from Brooklyn, wants the commission’s proposal shot down. In a statement, Je ries said the new districts don’t protect “historically under-represented communities” and blasted, once again, the 2022 process — which ended with a single special master, appointed by a Republican judge, drawing the

e question becomes, if Democratic lawmakers reject the commission’s maps and draw their own, whether districts can still be created to bene t Democrats without running afoul of the state constitution’s anti-gerrymandering clause. Two years ago, Republicans successfully sued to stop the implementation of Democrat-friendly maps and the process was thrown to the special master, who drew compact, fairly neutral districts that didn’t take incumbency into account. To the horror of Democrats, Jerry Nadler and Carolyn Maloney were tossed into the same Manhattan district, and Nadler ended up beating Maloney in a bitter primary. is year, Democrats will have to tread carefully. Republicans are poised to sue again. Democrats have two options: Push ahead and try to tweak the maps further or accept the commission’s work and move on.

e latter move, from a good-government perspective, is clearly the right way to go. New York’s redistricting process remains deeply awed, thanks to rules Andrew Cuomo, then the governor, engineered a decade ago. Having a bipartisan commission deciding the scope of legislative districts instead of a nonpartisan commission is silly. Let academics and experts unconnected from the political parties determine, as fairly as possible, what the lines should be.

Con ict of interest

Letting the state Legislature vote on the lines is even worse. ere’s a blatant con ict of interest at play, with some state legislators actively eying runs for Congress or, in the case of state Sen. John Mannion, already campaigning.

Of course, neither party genuinely cares about good government or fair redistricting. When Republicans controlled the state Senate, they blatantly gerrymandered districts, and national Republicans have long tried to redistrict Democrats into oblivion. Democrats, in New York especially, view their own gerrymandering as an e ective countermeasure. Fight re with re, as they say.

But it’s unclear, even if lawmakers draw the congressional lines and manage to survive another court challenge, how much Democrats will really gain. at’s the

crux of the matter. Truly dramatic changes, like joining Staten Island and Park Slope into a House district or drawing together the North Shore of Long Island and Westchester, could face legal hurdles. It’s possible Je ries has other tweaks in mind, like moving a few more Democratic voters into Mike Lawler’s Westchester and Hudson Valley district to bene t his Democratic challenger, Mondaire Jones. He might also seek to undo the commission’s e orts to aid Molinaro, a rst-term Republican. If he can do this without su ering another legal defeat, it will be a coup for national Democrats. But the voters themselves are left in a lurch. e commission, to

its credit, valued continuity, and didn’t di er much from the 2022 lines that voters are growing used to. Greatly upending congressional districts for the second time in two years would be lousy for democracy. What Democrats in the Legislature should do is create an actually fair, independent redistricting process for the next census, modeling their e orts on commissions in California and Arizona which mix nonpartisan and bipartisan appointees and maintain adequate distance from elected o cials. Do that, and all of this madness and confusion can be put to rest for good.

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

Governor puts $200 million toward one-time credit to utility customers . . . but it will barely buy lunch

By Caroline Spivack

e state Public Service Commission on Feb. 15 approved $200 million to deliver a one-time credit to utility customers, but the plan from Gov. Kathy Hochul will amount to a tiny credit: between $7.69 and $24.28.

the bill credit, but commissioners conceded that the aid doesn’t go far in helping customers grapple with long-term energy costs.

“It is not lost on me though that the issues around energy a ordability are much deeper than a pot of money,” said PSC commissioner Diane Burman during the Feb. 15 vote. “In this case, while signi cant, it’s also a drop in the bucket for the larger energy a ordability issues that are there.”

“I guess the message back to the Legislature will be that $200 million doesn’t go as far as it used to.”

John Howard, a PSC commissioner

“Energy a ordability continues to be a top priority in my clean energy agenda,” Hochul said in a statement. “ is utility bill credit is just one of many actions New York is taking to reduce costs for our most vulnerable New Yorkers.”

e PSC unanimously approved

Burman also emphasized a need for greater relief to small commercial customers. “ e impact [of increased energy costs] on businesses cannot be lost on us because it is really an economic engine that we need to be addressing,” she said.

More than 8 million electric and gas customers across the state will see the credit over the next 45 days.

Con Edison, which provides energy to New York City and West-

chester customers, estimated a one-time credit of $19.63 for electric customers and $18.79 for gas customers. e governor and the state Legislature allocated the aid as part of last year’s budget; the PSC ruling formally authorizes the distribution of the funds to New York utilities and their customers.

John Howard, another PSC commissioner, described the aid as “somewhat anemic.”

“I guess the message back to the Legislature will be that $200 million doesn’t go as far as it used to,” said Howard.

e slight utility relief approved this month builds on a handful of energy a ordability initiatives launched by Hochul’s administration, including $380 million in energy assistance program funding, $360 million in home energy program funding and the approval of another $200 million in ratepayer funds to help low-to-middle income New Yorkers access energy e cient products.

In the order approving the bill credit, PSC o cials said they expect the aid to “provide noticeable relief towards winter bills” but that they do not anticipate that it would make an impact on outstanding utility bills.

In 2019, before the Covid-19 pandemic, residential customers

owed $725 million while commercial customers owed $134 million in unpaid energy bills. ose gures have since soared, according to PSC data. As of August 2023, residential customers owe $1.3 billion and commercial customers owe $578 million — a 331% jump in unpaid utility bills by businesses.

Ross Barkan

The state Legislature should resist the temptation to tinker with the independently drawn congressional maps to once again aid Democrats. BLOOMBERG

Council aims to join housing vouchers suit against mayor

By Nick Garber

The City Council is seeking to join the lawsuit filed by low-income tenants against Mayor Eric Adams’ administration this month over City Hall’s refusal to implement a set of housing voucher laws, setting up a courtroom clash between the two branches of government.

The council filed a motion in Manhattan state court on Feb. 21 to become a party to the lawsuit, which was brought this month by a group of tenants represented by the Legal Aid Society. In its motion, the council said Adams’ unwillingness to enforce the voucher laws “upends the separation of powers enshrined in the City Charter.”

“His refusal not only deprives New Yorkers of housing benefits to which they are entitled under the law; it usurps the powers of the Council, a co-equal branch of city government,” the motion reads.

The four laws, first passed by the council last spring, greatly expand access to city-funded vouchers known as CityFHEPS that cover rent for people who are homeless or at risk of being evicted — loosening income restrictions, ending work requirements, and allowing people to apply for vouchers by showing rent-demand letters from

their landlords to prove they are at risk of losing their homes.

Adams’ administration opposed the bills due to their potential cost, which his office estimates at $17 billion over five years. He has also argued the council lacks the authority to expand the CityFHEPS program. But he failed to stop lawmakers from passing the bills, and when he vetoed them in June, the council voted to override his rejection weeks later.

Manhattan Supreme Court Judge Lyle Frank must now approve the council’s petition for the body to join the case. Although the council did not initially join Legal Aid’s suit, it has been expected for weeks to bring the case; Council Speaker Adrienne Adams said in January that she was prepared to sue if City Hall did not begin implementing the laws by February.

Low point in the relationship

The fight over the bills has marked a low point in the relationship between the mayor and the council, and especially with Speaker Adams, who began her term as a relative ally of the mayor’s but has increasingly challenged him — including by overriding his vetoes of two criminal justice bills last month.

In response to Legal Aid’s lawsuit this month, a City Hall spokeswoman repeated the administration’s argument that the council’s expansion of CityFHEPS could make it harder for shelter residents to move into permanent housing by creating new competition for scarce housing.

“With more than 10,000 households with CityFHEPS vouchers already in the city shelter system unable to find housing and a rental vacancy rate of just 1.4 percent, a historic low in the last 60 years,

the council’s bill will only make it harder for New Yorkers in shelter to move into permanent housing,” spokeswoman Kayla Mamelak said. “We always seek to work collaboratively with our colleagues at the City Council and look forward to identifying more areas of common ground to support New Yorkers experiencing homelessness, including an aggressive, citywide effort to build more housing in every neighborhood.” The council, on the other hand, says the scarcity of affordable

apartments only underscores the need to help low-income New Yorkers remain in their homes.

Both the council and outside advocates have argued the bills would cost far less than the administration estimates. The council projects $10.6 billion over five years, with 47,000 new households qualifying for vouchers each year and both include expected savings from reducing costly shelter stays.

In any case, CityFHEPS is a major cost to the city, even before the potential expansion. Recent analyses by the Citizens Budget Commission and Independent Budget Office both found that the current CityFHEPS program will cost the city billions of dollars more in the coming years than Adams had projected in his latest spending plans.

The nonprofit Legal Aid Society celebrated the council’s move to join its suit, saying in a statement that the case would hold Mayor Adams accountable for “illegally refusing to implement the reforms needed to improve and expand CityFHEPS.” Three of the plaintiffs in Legal Aid’s case are facing eviction proceedings by their landlords but could stay in their homes if the laws were enacted, while a fourth plaintiff is living in a shelter and could qualify for CityFHEPS vouchers under the laws, according to Legal Aid.

City Council Speaker Adrienne Adams. The council is aiming to join a lawsuit against Mayor Eric Adams’ administration. The mayor has refused to implement a set of laws expanding access to low-income housing vouchers. eMIL COHeN/NyC COuNCIL MeDIa uNIT

A shallow celebration of MWBE success

Supporting minority and women-owned business enterprises is a valid strategy to build generational wealth among historically marginalized communities, and it’s an approach that Mayor Eric Adams has vocally championed.

However, reporting from Crain’s Nick Garber in this week’s edition suggests that the city's MWBE program is falling short of its ambitions. What should be a pathway to equity is too often turning into a trail of unmet expectations and red tape.

e mayor’s o ce was keen to highlight the signi cant numbers associated with the MWBE program at a Gracie Mansion event earlier this month. However, the reality on the ground tells a di erent story. For some business owners who have invested their hopes and resources into this initiative, large-scale announcements are of little comfort when their individual experiences are met by silence from the city. People who approach city agencies about this program deserve the basic professional courtesy of returned calls and emails. Lack of response leaves people to question the accessibility and fairness of the program.

Not every vendor will seamlessly align with the city’s contracting needs. However, fairness dictates that every certi ed

MWBE should have their inquiries acknowledged.

e Adams administration has taken some inspiring steps toward improving the program, including appointing Michael Garner, the city’s rst-ever chief

business diversity o cer, who brings relevant experience from having led the Metropolitan Transportation Authority’s diversity e orts for 15 years. Garner has a task force dedicated to change, and two of its recommendations were approved last

year by the state Legislature: allowing electronic applications and raising the cap for no-bid contracts to $1.5 million from $1 million.

Work to be done

However, there is obvious work to be done, including reforming the capital construction process, registering contracts and paying vendors in a timely way, and helping with access to capital. e administration must also address the “disparity within the disparity,” meaning that big rms and those owned by white women and Asian American men have long enjoyed more success at winning city contracts.

e perpetuation of contracts among a familiar circle of vendors sti es the very diversity and innovation the program claims to champion.

Adams is emphasizing style over substance when he hosts celebratory events touting the program’s success. Celebrating milestones is important, but not at the expense of addressing systemic issues that prevent progress. For the MWBE initiative to ful ll its promise, the administration must move beyond grand declarations and focus on the granular work.

LETTER TO THE EDITOR

Film tax credits play critical role in augmenting production facilities, making state a leader in industry

I READ with interest your story about a recent study criticizing a program of tax credits and incentives designed to foster the film production industry [“New York’s generous film tax credit is a failure, state report finds,” Feb. 12].

While we appreciate the financial analysis of the program that started 20 years ago, we believe that the benefits it continues to bring to the state, regional, and local economies are significant and, in fact, play a critical role in the attraction, retention and expansion of film production facilities. They have enabled New York to become a leading film production location in the nation.

We need look no further than Westchester County for evidence. The City of Yonkers now proudly refers to itself as “Hollywood-on-Hudson’” and with good reason. Great Point Studios and Lionsgate Studios last year opened a state-of-the-art production facility in the heart of the downtown as part of what will become among the largest film and TV production facilities in the Northeast, creating 200 to 300 jobs.

And it doesn’t stop there. As part of its $500 million investment, Great Point plans additional campuses in the southwest and northwest sections of the city, while other facilities related to film

production are under active discussion. While the focus is on the studios, the economic and social benefits they are fostering should not be overlooked. Great Point and Lionsgate are already

providing new jobs for residents, while numerous community businesses are benefiting by providing a range of goods and services. And in partnership with the Yonkers Public Schools, Great Point

While the focus is on the studios, the economic and social bene ts they are fostering should not be overlooked.

is opening a media arts high school that will allow some of the most economically disadvantaged young people in Westchester the option to attend college or learn skills that will enable them to be hired for high-paying film production jobs straight out of high school.

The arrival of the film production companies is already bringing in new tax and permit revenues, workforce development and numerous other economic benefits. And it is bringing a sense of pride and a renewed spirit to an entire city.

It’s safe to say that this dramatic burst of economic energy would not be happening without the state’s incentive program.

John Ravitz is the executive vice president of the Business Council of Westchester.

Michael Garner (center), the city’s chief business diversity of cer, speaks with participants at a Gracie Mansion celebration of MWBE contracting. BUCK ENNIS

The economic and social bene ts of the lm tax credit program should not be overlooked, writes John Ravitz of the Business Council of Westchester. | BLOOMBERG NEWS

2024 and the comeback of New York’s office market

No matter how dire the headline or pessimistic the pundit, I’ve spent the past three years telling anyone who would listen that the inperson office has a bright future.

Now, New York’s office market has entered 2024 with more predictability and stronger fundamentals than at any time since the pandemic, backed by new data showing leasing momentum.

The flight-to-quality office trend is still going strong. Based on the number of 2023 lease transactions at $100 per square foot or more, CBRE found that the high-end of the market is “impervious to the woes” that the lower tier is facing. JLL agreed that “the top of the market remains strong” and that a particular bright spot is Midtown, where more than 90% of top-tier leasing activity occurred in the fourth quarter of 2023.

Back in 2019, 1155 Avenue of the Americas was just 53% leased. Today it’s 93%. In 2020, One Five One West 42nd Street was at 77%. Today it’s 96%. Last year, 655 Third Avenue near Grand Central was only 52% leased. Now it’s 85%.

At many of our properties, we’re seeing more space leased and higher net-effective rents. In 2023, we leased over 1 million square feet — the highest level of leasing during the past eight years but for 2018 which was slightly higher. The momentum we’ve seen over the past few years at a range of different buildings and subdistricts tells me the market continues to get stronger.

Hybrid working

Things are even looking up for some of the challenged Class B and C properties. While they have not rebounded like Class A and the top of the market, The New York Post reported “small, growing companies” are bringing new life to these buildings.

Across The Durst Organization’s 13million-square-foot Class A and A+ commercial portfolio, we have a lower vacancy rate today than we did in 2019. That’s true of our flagship properties like One Bryant Park, which is 100% leased, and our older properties, in which we have continuously invested to maintain their appeal to tenants.

PERSONAL VIEW

The fact that many employers permit a hybrid working environment where employees are at home one or two days a week is not undercutting their belief that in-person remains vital to their bottom line. And that’s fine with us. Our tenants do not lease space by the day.

Employees too increasingly see the benefits of in-person work, whether hybrid or full time. Young people starting their careers want to be in an office to learn, get feedback and build their networks.

The recent return-to-office numbers provide further optimism. The Real Estate Board of New York’s latest analysis with Placer.ai found that average office visitation

rates in Midtown rose to 73% in December. Throughout Manhattan, if you exclude the holiday week at the end of the year, visitation rates would have been 74% for December. It's important to note that this data includes Fridays, which have long been a slower day in the office including before the pandemic but is an even quieter day now. Subway ridership has also increased at key commuter stations.

While continuing to promote the benefits of in-person work is important, the primary challenge currently facing commercial owners and operators isn’t convincing tenants to return to in-office work. The bigger challenge is getting the banks and regulators to recognize the strength and proven rebound of the top of the commercial market.

Banks have significantly pulled back lending for real estate without distinguishing between the successful top-tier sector of the market and challenging sectors. Real estate is suddenly viewed as a monolith when it is not and never has been.

During the 2008 recession, the Fed had a de facto policy of extending loans to sup-

port viable buildings until the end of the crisis. Today, regulators appear to be doing the opposite by discouraging lenders from loaning to commercial real estate at all. This is hurting New York City.

These are real challenges but I am hopeful banks and regulators will soon change course by recognizing the strength of office buildings with robust leasing activity. New York City is back on its feet, and the office market has more and more momentum.

During my decades of leading our real estate firm through every up- and down-market cycle, I’ve developed a reputation as a blunt realist: Our industry has weathered crises like this before, and we will again. I’m entering 2024 with my optimism intact.

Grocery store wine sales would harm small businesses

Get used to seeing more vacant retail space in a neighborhood near you. Like small hardware stores and other mom-and-pop businesses that have disappeared over the years with the proliferation of big box retailers, small liquor stores will be forced to close too under legislative initiatives underway in New York.

It has taken decades of careful regulation in the liquor industry to create a system that safeguards communities, prohibits the sale of liquor to minors and establishes a multi-layered sales and distribution network that employs tens of thousands of people in good paying jobs and on the wholesale and distribution levels.

Now, intensive lobbying efforts led by deep-pocketed corporations are threatening to destroy that tightly regulated system and put more than 45,000 New Yorkers out of work.

and laws to allow them to take command and dominate wine sales.

Local businesses simply can’t compete with their tremendous buying power, advertising clout or Wall Street funding.

Michael Correra owns

Michael-Towne Wines & Spirits in Brooklyn Heights. He is the executive director of the Metropolitan Package Store Association.

Stores like Wegmans and Whole Foods are among multibillion-dollar corporations now seeking the right to sell wine across New York State.

In New York, liquor store owners are allowed one single license. Supermarket chain owners intend to rewrite the rules

The market that has been very well served by local liquor retailers for decades.

Within the past year, Colorado approved the sale of wine in grocery stores similar to the proposal in New York. Since the Colorado law went into effect, it has been Armageddon for Colorado liquor shops, with stores reporting sales down 30% to 40% since supermarkets began selling wine.

The average U.S. grocery store is 38,000 square feet. Whole Foods, which is part of Amazon's empire, was reportedly evaluating further expansion into former Sears Department store locations, which should illustrate the enormity of their ambitions.

Local competition

If our state Legislature allows this change to pass, it will spell doomsday for more than 4,500 local liquor stores and the roughly 45,000 jobs they provide in com-

munities in counties across the state.

History shows when local competition is wiped out, the big box retailers are then free to raise prices or narrow your selection.

Neighborhood wine and liquor store owners know their patrons and are an established part of their communities. They employ local workers and are positive contributors giving back to their communities.

New York’s leaders need to stand up and fight for brave local entrepreneurs willing to take a chance and start a business. New York must support our local merchants.

America is a nation of entrepreneurs.

We should not transform every retail ecosystem into a big box or megastore experience. The so-called Walmart-ization of America diminishes the importance of local businesspeople, and it’s up to all of our public officials to stand opposed.

If you want to support the erosion of your community, then by all means allow big box stores and billion dollar grocery chains to take over. But if you truly believe in protecting the future of small businesses, then please shop locally, and remember it’s the people that make a neighborhood, not the corporations.

Douglas Durst is chairman of The Durst Organization.

The challenge facing owners and operators is getting the banks and regulators to recognize the strength and proven rebound of the top of the commercial market, writes Douglas Durst of The Durst Organization. | bLOOMberG

Multibillion-dollar corporations like Whole Foods and Wegmans are seeking the right to sell wine across New York State. | bLOOMberG NeWS

FINANCIAL SERVICES

COMMERCIAL REAL ESTATE

Concord Summit Capital

J.P. Morgan Private Bank

LAW

LEGAL

MARKET RESEARCH

Concord Summit Capital, a leading real estate advisory, investment, and private fund company is pleased to welcome Aryeh Friedman as Managing Director. With more than 30 years of commercial real estate experience, most recently with Rok Lending and Madison Realty Capital, he has closed more than $5 billion in transactions. His national expertise with all property types will allow CSC to grow and continue its success across all its platforms.

CONSULTING ENGINEERING

JB&B

David Barrocas has joined J.P. Morgan Private Bank in New York as a Managing Director and Banker. David works with some of the firm’s largest and most sophisticated individuals and families to deliver experienced guidance addressing the complexity of institutional-scaled wealth. David joins the firm from John Ledecky Family Office.

FINANCIAL SERVICES

J.P. Morgan Private Bank

Mohammad Ali, PE, LEED AP has been appointed Associate Partner at JB&B. He has experience as a Project Manager and Project Engineer on a wide variety of complex projects, from office towers to educational facilities. Mohammad is part of JB&B’s Aviation leadership team and is currently working on The New Terminal One at JFK International Airport. He has been involved in the construction and renovation of numerous high-profile office buildings, including One World Trade Center and 270 Park Avenue.

CONSULTING ENGINEERING

JB&B

Robert A.

Downward, PE has been appointed Associate Partner at JB&B. During his 30-year tenure, Robert has served as Project Manager and Project Engineer on a broad range of projects, including residential and office buildings, broadcast facilities, and laboratory facilities. In addition to One Manhattan West, Robert has lent his expertise to numerous cultural projects, including the Whitney Museum of American Art and the National September 11 Memorial.

Hemali Dassani has joined J.P. Morgan Private Bank in New York as an Executive Director and Banker working with some of the most prominent clients in the area. She is a master connector, known for networking with like-minded individuals to share synergistic ideas. Hemali joins the firm from Caplink Securities.

FINANCIAL SERVICES

Mutual of America Financial Group

Thaddeus Pollock joined Mutual of America Capital Management LLC as Executive Vice President and Head of Value Equity by Mutual of America Financial Group, a leading provider of retirement services and investments. He will oversee the Value Equity portfolio management within MoA Funds and separately managed accounts, which, combined, have approximately $28 billion AUM. He brings more than two decades of investment management experience and previously spent 20 years at Cramer Rosenthal McGlynn.

Aronson Mayefsky & Sloan Aronson Mayefsky & Sloan, LLP, a prominent matrimonial law firm, announced the election to partner of Liza Camellerie and Elizabeth (Elle) E. Erickson, both formerly counsel at AMS. Ms. Camellerie has focused on family and matrimonial law for more than 15 years. Her practice includes child and spousal support, paternity, equitable distribution, separation agreements, preand postnuptial agreements, as well as child abuse and neglect issues.

Ms. Erickson has practiced exclusively in matrimonial and family law for nearly 20 years. She has represented clients in all stages of complex and high net worth matrimonial and family law matters, including child support, custody, equitable distribution, maintenance, as well as appellate proceedings.

LAW

Aronson Mayefsky & Sloan

Aronson Mayefsky & Sloan, LLP, a prominent matrimonial law firm, announced the welcoming of new partner of Patricia Hennessey With more than 37 years of experience, Ms. Hennessey is known as a pre-eminent matrimonial trial and appellate lawyer in the New York area. She has tried and argued appeals in cases involving complex equitable distribution and support issues and child custody. Ms. Hennessey has achieved an “AV Preeminent” rating from Martindale Hubell every year for more than 11 years.

Thompson Hine

Circana

Michael N.Samuels has joined as a partner in Thompson Hine’s Real Estate practice. He represents a broad range of clients nationally and has decades of experience advising on a wide variety of sophisticated real estate transactions, including acquisitions, sales, leasing, financings, development, and property management of large multifamily apartment projects, trophy office buildings, mixed-use developments, and commercial properties across the country.

COMPANIES ON THE MOVE MERGERS & ACQUISITIONS

or contact Debora Stein at 917.266.5470 / dstein@crain.com

Cumming Group cumming-group.com

Cumming Group is pleased to announce its merger with Zubatkin Owner Representation (Zubatkin). Zubatkin will expand Cumming Group’s NYC headquarters headcount to more than 200 team members, while also growing the firm’s presence in Florida. Zubatkin’s unique experience in the institutional sector will enhance Cumming Group’s ability to serve the cultural and educational markets in the United States and Europe. Zubatkin specializes in managing the planning and implementation of capital construction projects for notfor-profit institutions, including museums, performing arts centers, educational facilities, and religious organizations, and currently oversees some of New York City’s most prominent private developments.

Circana, a leading advisor on the complexity of consumer behavior, appoints Jeremy Allen as Chief Commercial Officer. He previously served as President, Consumer Packaged Goods at Circana. In this newly created role, he’ll lead global commercial strategy, leveraging extensive client service experience to promote Circana’s technology, solutions, and insights to help clients worldwide find new opportunities and spark growth.

MARKET RESEARCH

Circana

Circana, a leading advisor on the complexity of consumer behavior, appoints Joanne Sackett as president, General Merchandise. The company’s softlines, entertainment, technology, home, financial services, and public sector verticals are in her purview, as well as Circana’s cross-industry businesses in Canada and Latin America. Sackett will also oversee business development and the contract office. Previously, Sackett served as president of Circana’s U.S. Softlines business.

MARKET RESEARCH

Circana

Circana, a leading advisor on the complexity of consumer behavior, appoints Rob Hill as president, Global Retail. In this role, he’s responsible for leading Circana’s global retail commercial teams, including overseeing Circana’s innovative retail collaboration solutions, engagements with key retail clients, and developing next-generation retail solutions to bring to market to better serve retailers. He previously served as Circana’s president of Retail for North America.

AN ANNOUNCEMENT

Camellerie

Erickson

MWBE

From Page 1

The program spells out targets for the percentage of city spending that should go to different demographic groups, lists certified companies in a public database, and makes MWBEs eligible for small, nobid contracts. Halfway through Adams’ term, tangible progress for New York City’s MWBEs has stagnated.

Data from City Comptroller Brad Lander shows spending on MWBEs dropped slightly in the last fiscal year to $2.1 billion, or 5.3% of new prime contracts awarded by mayoral agencies, compared to 6% the prior year. The number is up from the last full year of Bill de Blasio’s administration, when it totaled 4.6%.

Business owners still complain of chronically late payments, as well as a “disparity within the disparity.” Big firms and those owned by white women and Asian American men have long enjoyed more success at winning city contracts.

“There’s other big [general contractors] out there and they just keep getting the jobs,” said Alex Quinones, a contractor based on Staten Island who has missed out on chances to bid for city contracts because he lacks the required financing and bonding. “The same people over and over, not giving us an opportunity.”

The Adams administration did not dispute the comptroller’s findings, but responded by noting that MWBE spending reached $6.3 billion last year when you include subcontracts and contracts from non-mayoral agencies like Health + Hospitals and the Economic Development Corp., both of which are public benefit corporations, and the Department of

Education.

The administration also says it is building the groundwork for future success. In Albany last year, the city successfully pushed a handful of bills that could boost MWBE spending, including one that allows electronic bidding, and another that raised the city’s cap for no-bid MWBE contracts from $1 million to $1.5 million.

Adams has also appointed the city’s first-ever chief business diversity officer, Michael Garner, and reorganized the city bureaucracy by having agencies report directly to him.

“It’s great that there’s a lot of money in the city that they’re funding for minority and women entrepreneurs. But I try to apply, and I can’t get through.”

Maria Tyner, owner of a Bronx insurance and multiservice company

“For the first time, we have someone that the agencies have to report to that has the direct ear of the mayor,” said Elizabeth Velez, president of a family construction firm that does millions of dollars in business with the city. “That’s huge.”

‘I can’t get through’

The policy changes have not yet been felt by most of the business owners who crowded into the Feb. 6 Bronx event.

Gregory Morgan Jr., owner of the Bronx photography studio LR2, hoped to learn more about how the city seeks out creative work, which he rarely finds listed on public solicitations. But he left with the impression that agencies tend to rely on vendors with whom they are already familiar.

“It’s very much who you know,” said Morgan, who is known professionally as Shotti. “I don’t think every organization or individual that has business aspirations has those connections to get them the projects that they want.”

Although extensive rules govern city procurement, personal connections play an obvious role. MoCaFi, a Black-owned finance company, has contracted with the city to provide debit cards to migrants for food and baby supplies. Adams has said the partnership dates back to a meeting he had with the company while running for mayor.

Several attendees at the Bronx event also described fits and starts with the city’s famously lengthy certification process for MWBEs. Maria Tyner, owner of a Bronx insurance and multiservice company, said she, like many other entrepreneurs, relied on a third party to help her get certified — in her case, the Bronx Chamber of Commerce. Since then, she has applied for contracts without success.

“It’s great that there’s a lot of money in the city that they’re funding for minority and women entrepreneurs,” she said. “But I try to apply, and I can’t get through.”

Quinones, the Staten Island contractor, got his MWBE certification last year, but he has run up against the lack of capital that has hamstrung many others. He applied in April for a low-interest loan offered by the city’s Small Business Services Depart-

Eric Adams speaking at the Gracie Mansion MWBE event buCK eNNIS

MWBE

From Page 11

ment, but has heard nothing since.

“I did the application, nobody has reached back out to me,” he said.

Beyond the individual stories, there are large-scale problems that continue to limit the reach of the city’s MWBE spending. Among the most visible is late payments — for years, the city has failed to register a large share of its contracts until after their start date, forcing vendors to essentially begin work for free.

“Since many of us come from a word-of-mouth community, if you saw people who won contracts struggle and some go out of business, you don’t have an incentive to go and pursue opportunities even when they exist.”

Rev. Jacques DeGraff

Some 61% of MWBE contracts were registered late in the last fiscal year, including one-third that took between one and six months, according to the comptroller’s office. (City Hall has disputed the figure, saying it is below 21%.) Late payments can put a severe financial strain on MWBE vendors, and may discourage others from applying, said Rev. Jacques DeGraff, a longtime advocate for the city’s MWBEs.

“You end up giving the city a shortterm, no-interest loan while you’re in effect subsidizing a project,” he said. “Since many of us come from a word-of-mouth community, if you saw people who won contracts struggle and some go out of business, you don’t have an incentive to go and pursue opportunities even when they exist.”

Adams and Comptroller Lander have proposed reforms aimed at speeding up payments, but many have yet to be realized. Garner told Crain’s he is pushing for the city to implement a policy akin to what is already in place at his former em-

ployer, the Metropolitan Transportation Authority, which aims to honor every payment within 10 days of an invoice.

"On a daily basis, I'm getting emails from businesses who are waiting to get paid,” Garner said.

Contractors have also pinned hopes on Adams’ pledge to reform the city’s capital construction process, widely seen as inefficient and disadvantageous to MWBEs. A few recommendations from Adams’ task

Prime contracts awarded by mayoral agencies to certified MWBEs have hovered between 5% and 6% of New York City’s overall contract spending since fiscal year 2021.

Value of new registered contracts

Minority- and women-owned business enterprisesNon-MWBE

force on the topic were enacted in Albany, but the administration is not promoting the effort as visibly as some advocates would like, and some of its recommendations, like creating lists of pre-qualified MWBE vendors for all agencies, have not yet been implemented.

“It’s an underperforming asset,” DeGraff said. “It has the potential for landmark progress, but I’m frustrated at the pace.”

Garner said the task force is still meeting once a week, adding that its dozens of recommendations will “take a little bit of time” to execute.

‘Disparity within the disparity’

Most distressing to many observers is the disparity within MWBE awards, in which companies owned by white women and Asian American men tend to do

Black- and Hispanic-owned businesses tend to receive less of the city’s MWBE contract spending, in what advocates have dubbed a “disparity within the disparity.”

Michael Garner, Mayor Eric Adams’ chief business diversity officer | BUCK ENNIS

better than others.

In fiscal 2023, male-owned businesses had higher contract values than women-owned firms in every demographic category. Black, Hispanic and women-ofcolor-owned businesses each had around 1% of the contract value for projects subject to the city’s MWBE goals, compared to 3% for white women and 4% for Asian men, the comptroller’s report found.

There are few obvious solutions for the seemingly intractable problem. Adams is taking a stab through an executive order, issued last year, that directs all no-bid MWBE contracts to be offered first to Black, Hispanic, Native American and Asian women-owned businesses. But that approach has its limits: No-bid contracts totaled just $175 million last year, a fraction of the city’s total MWBE spending.

‘Like the myth of Sisyphus’

Established under Mayor David Dinkins in 1992 and dismantled a few years later by Rudy Giuliani, New York’s MWBE program was revived in 2005 under Michael Bloomberg after years of agitation by advocates.

De Blasio described MWBEs as a priority during his eight years in office and signed the 2019 law that set the citywide goals. But by the end of his term, city spending on MWBEs had dropped to its

lowest level since he took office, including notably scant awards to minority contractors during the Covid-19 pandemic.

Adams campaigned on expanding the MWBE program, calling it a tool for building wealth in communities of color. The focus has political upside for the mayor, who has embraced the city’s business community and enjoys some of his strongest support among middle-class Black and Latino voters.

“Thirty years later, when I became the second mayor of color, we are now expanding and we're seeing Mayor Dinkins' vision,” Adams said on his personal radio show this month.

While some of Adams’ campaign promises appear unfulfilled, such as a pledge to create a “real-time” tracker for MWBE spending, appointing Garner was one tangible step.

Garner led the MTA’s diversity efforts for 15 years and was the star of the show at this month’s Gracie Mansion reception. In an interview, he said the new structure has created more pressure for the city’s dozens of agencies to heighten their attention to MWBE contracts — embodied by weekly City Hall meetings in which he gets to grill each department.

“We want to know how many contracts you’ve awarded since last week, how many of those contracts were awarded to minority and women-owned businesses, and what’s in your pipeline?” Garner

said.

That focus is evident in some of Adams’ signature initiatives, like the MyCity website that’s envisioned to become a onestop for government services. Adams has awarded 54 contracts to 26 outside firms working on the platform, all but three of whom are MWBEs — a controversial reliance on outsourcing that has nonetheless allowed the administration to direct more than $15 million to minority- and women-owned firms.

And the migrant crisis, despite Adams’ near-apocalyptic rhetoric about the strain it has placed on the city’s finances, has also been a big procurement opportunity. City Hall has awarded $1.1 billion in contracts to MWBEs for migrant-related work, according to the administration — an outcome that Garner attributes to another set of weekly meetings focused solely on migrant contracts.

All the behind-the-scenes work has yet to move the needle significantly on bottom-line spending, according to this month’s comptroller report. But some advocates for MWBEs are reassured by Garner’s presence, which they hope will produce more structural change than the sometimes-toothless executive orders of prior mayors.

City bureaucracy is slow to change. If Adams manages to win re-election next year, any major progress his administration makes on MWBEs may not be felt until that second term, argued Wallace Ford, a professor at CUNY’s Medgar Evers College who served in the Dinkins administration when the MWBE program was created.

“It’s like the myth of Sisyphus,” Ford said. “You roll the rock up the hill a little bit and then it rolls back down. You have to keep doing it.”

Gregory “Shotti” Morgan Jr. (right), owner of LR2 Photo Studio | buCK eNNIS

Michael Gartner (center) at the MWBE event at Gracie Mansion this month buCK eNNIS

MTA suspends construction contracts for transit upgrades amid legal challenges to congestion pricing

By Caroline Spivack

The Metropolitan Transportation Authority has hit the brakes on issuing new construction contracts for major work throughout the city’s transit systems, as lawsuits that seek to block congestion pricing work their way through the courts.

Congestion pricing is set to raise $15 billion for subway, buses and commuter rail projects, but multiple legal challenges have delayed the launch date and jeopardized revenue to fund critical infrastructure work. The result is a pause on projects to improve the city’s

will not be issuing any new construction contract solicitations,” wrote Jamie Torres-Springer, president of MTA construction and development, in a Feb. 14 letter to contractors obtained by Crain’s “[There will be] limited exceptions for emergency work, small business mentoring contracts, and small projects with dedicated Federal funding. We will only initiate procurements we expect to be able to award.”

Congestion pricing represents the largest single funding source for the MTA’s 2020-24 capital construction plan, which is investing $51.5 billion throughout the authority’s networks.

“We’ve arrived at the point where if the money doesn’t flow, work is stopped.”

Rachael Fauss, senior policy advisor at government watchdog Reinvent Albany

mass transit: an expansion of the Second Avenue subway, upgrades to signals for more reliable subway service, disability-friendly upgrades and other initiatives.

“Due to this ongoing uncertainty, while litigation is pending, we

The MTA’s decision to halt new construction contracts stands to create “ripple effects that hurt our economy,” said Kate Slevin, executive vice president of the Regional Plan Association.

“This is the real-world consequence of the congestion pricing lawsuits and delays in the implementation of the program,” said Slevin. “If projects are pushed back people have less work and so the implications are beyond just

the riding public and to the broader economy.”

Torres-Springer’s letter noted that certain smaller projects financed with federal funds can move forward, but congestion pricing delays are poised to affect large, federally-backed projects that require MTA matching funds. The Second Avenue subway expansion is among them.

Broadens the disruptions

The MTA has already delayed subway signal modernizing work along the A and C lines in Brooklyn, but the Feb. 14 letter broadens the disruptions.

“We’ve arrived at the point where if the money doesn’t flow, work is stopped,” said Rachael Fauss, senior policy advisor at government watchdog Reinvent Albany.

Once operational, congestion tolls levied on motorists entering Manhattan below 60th Street are expected to bring in $1 billion a year that the MTA will bond against to finance $15 billion for infrastructure projects. The figure represents 27% of the current capital plan’s funds.

The tolling plan is expected to

launch in June, after several years of delay. The pending lawsuits, including challenges filed by New Jersey Gov. Phil Murphy, Staten Island Borough President Vito Fosella and United Federation of Teachers President Michael Mulgrew, have delayed the implementation by at least a month and threaten to further upend the schedule.

Fauss fears the implications of

further delays for the current and future MTA capital plans.

“The MTA has a new capital plan coming and it means that things might get rolled over and the whole thing will be delayed,” she said. “It’s worth thinking about who really is suffering here, and its riders because we’re continuing to ride on old trains on old tracks and not getting the basic stuff we need fixed.”

A congestion pricing toll gantry at 61st Street and West End Avenue in Manhattan. | BUCK ENNIS

Merck hit with two new wrongful-death suits alleging vaccine killed young girls

By Jacqueline Neber

Two mothers have filed a pair of wrongful death lawsuits against Rahway, New Jersey-based Merck alleging that the pharmaceutical company’s Gardasil vaccine killed their daughters.

The suits, both filed in North Carolina courts this month, claim that Merck concealed information about Gardasil’s potential side effects while obtaining Food and Drug Administration approval for the vaccine 2000s. They also allege that Gardasil was Merck’s attempt to make up for revenues lost when it had to pull Vioxx, a pain medication that allegedly caused deadly cardiovascular side effects, from the market.

Merck failed to disclose potential adverse effects of Gardasil to the public and the FDA, court documents allege. While the vaccine and its successor Gardasil 9 aim to protect against cancers and diseases caused by HPV, the lawsuits argue that the products’ effectiveness is un-

advertising campaigns that created fear around HPV and cancers. Gardasil brings in more than $6 billion in revenue annually.

Merck failed to disclose potential adverse effects of Gardasil to the public and the FDA, court documents allege.

proven and that Gardasil can cause a “constellation of serious adverse reactions and gruesome diseases.”

Furthermore, the suits claim, Merck profited from creating

“Merck sold and falsely promoted Gardasil knowing that, if consumers were fully informed about Gardasil’s risks and dubious benefits, almost no one would have chosen to vaccinate,” the documents read. “Merck negligently and fraudulently deprived parents and children of their right to informed consent.”

One of the suits claims that Sydney Figueroa, who was 12 when she received her second dose of Gardasil, sustained de-

bilitating autoimmune and neurological injuries because of the vaccine that left her unable to walk normally or swallow. She died in 2021 because of a pulmonary embolism that resulted from her injuries, the lawsuit alleges.

The other case alleges that Isabella Zuggi died just weeks after receiving her first dose of Gardasil, in 2022, after developing a high fever, movement disorders, behavioral changes and incontinence. She was declared brain dead and died at 10 years old.

Representatives from Merck did not respond to requests for comment. Monique Alarcon, an attorney at Los Angeles-based law firm Wisner Baum, which represents the plaintiffs in each

case, told Crain’s the pair of lawsuits are part of a group of more than 150 cases against Merck about Gardasil.

Suits about ‘failure to warn’

Merck will not respond to the individual lawsuits, she said, and instead will file its position on the science behind Gardasil later this year. The plaintiffs’ goal, Alarcon added, is to go to trial.

“These lawsuits are all about Merck’s failure to warn,” she said. “So if they want to continue to market their drugs, they should warn consumers and doctors about the risks that the data clearly shows and that our clients are alleging Gardasil causes.”

Bristol Myers Squibb launches $674M drug discovery partnership with city biotech startup

By Amanda D’Ambrosio

Pharma company Bristol Myers Squibb has offered a Union Square biotech startup $674 million to use machine learning to design new small-molecule therapeutics, the companies announced this month.

Bristol Myers Squibb is collaborating with VantAI to use the biotech company’s artificial intelligence technology to discover and deploy “molecular glues,” a new class of molecules that connect two cell proteins that wouldn’t normally fit together. The glues act as an adapter to bind separate proteins, leading to potentially novel interactions — and possible pathways to new classes of therapeutics, said Dr. Zachary Carpenter, founder and CEO of VantAI.

The use of small molecules to alter protein processes is an

emerging area of drug discovery. In some cases, scientists have attempted to use molecular glues to tag specific disease-causing proteins as waste, tricking the body into eliminating dangerous agents.

‘Unlock a new chapter’

“The goal here is essentially to provide a way to rewire the circuitry in the cell by being able to inject the molecules and decide which proteins should interact,” Carpenter said. VantAI’s mission, he added, is to “unlock a new chapter of medicine by making protein interactions programmable.”

But programming these protein interactions is no small feat. There are more than 20,000 protein-coding genes in the body, making the possible number of combinations enormous, Car-

penter said. VantAI uses artificial technology called geometric deep learning to predict different protein combinations.

“If we treat this as a geometric puzzle, we think AI is a great tool to actually solve that puzzle,” Carpenter said.

Through the recent collaboration, Bristol Myers Squibb will pay VantAI up to $674 million if it hits certain drug discovery, development, clinical and sales milestones. The companies also have the option to extend the partnership to new therapeutic areas.

Bristol Myers Squibb and VantAI did not disclose what types of diseases the partnership will target. Carpenter said

Northwell Health opens $5 million multispecialty practice in Glendale

By Amanda D’Ambrosio

Northwell Health opened a $5.1 million multispeciality practice in Glendale on Feb. 15, building on the health system’s plan to expand outpatient locations in Queens.

The practice, located at 80-40 Cooper Ave., offers primary care and a range of specialty services, including behavioral health, cardiology, endocrinology, primary care, pulmonary medicine and urology. The space totals 8,500 square feet, including 16 exam rooms, a procedure room and units to conduct ultrasounds and echocardiogram tests.

The new practice will act as a connector between health facilities in Queens, including Long Island Jewish Forest Hills and the Northwell Health Cancer Institute in Rego Park, said Dr. John D’Angelo, senior vice president and regional executive director of Northwell’s central region. He added that co-locating multiple specialty services at the new practice will improve the quality and efficiency of care that patients can receive in their own neighborhoods.

Hope for more care closer to home

“The hope is that we build more primary care and more primary specialty care closer to peoples’ homes,” D’Angelo said, noting that more than half of the people who receive inpatient care at Long Island Jewish Forest Hills are Queens residents.

that VantAI does not focus on specific disease areas, as its technology focuses on the molecular level. But he added that these discoveries could lead to important therapeutic pathways for cardiac, metabolic and oncologic diseases.

VantAI was founded in 2019 out of Roivant Sciences.

D’Angelo said the new practice expects to serve between 12,000 and 13,000 New Yorkers in its first year of operation and has the capacity to see roughly 35,000 patients annually. The practice will employ 10 physicians and 27 support staff.

The Glendale practice is Northwell’s fourth outpatient clinic in Queens. The health system plans to open an additional practice in Fresh Meadows in the coming months, D’Angelo said.

Northwell Health has 21 hospitals and 900 outpatient locations across the New York City region.

Northwell Health launched an 8,500-square-foot multispecialty practice at 80-40 Cooper Ave. in Glendale on Feb. 15. NOrTHWeLL HeaLTH

Pharmaceutical company Merck is based in Rahway, New Jersey. bLOOMberG

VantAI, a Union Square-based biotech company founded in 2019, entered a $674 million partnership with Bristol Myers Squibb to discover potential new therapies. VaNTaI

Related Cos. had the two best-selling developments in Manhattan in 2023 despite ‘a lot of headwinds’

By C. J. Hughes

In a sluggish year for sales, the two top-selling projects in Manhattan in 2023 were from a familiar source, The Related Cos., according to new data.

The developments were Tribeca Green, a 265-unit project in Battery Park City that signed 141 contracts, and 450 Washington St., a 172-unit offering in Tribeca that inked 85 deals, said the real estate marketing firm Corcoran Sunshine. Both buildings are co-op conversions that began as rental buildings.

The buildings are located in sought-after neighborhoods and heavily amenitized, and they came to market at a time of limited supply, which may explain their appeal. But they might also have benefited from quirkier factors.

“We came in against a lot of headwinds,” Tom Deighton, a Related vice president, told Crain’s. “But we think the high sales volume has proven our concept and are obviously pleased.”

Similarly, in terms of revenue generated, 450 Washington clocked in fourth in 2023 among Manhattan developments, and Tribeca Green finished sixth, Corcoran Sunshine said.

Developed about 15 years ago by the New York-based Jack Parker Corp. as a rental called Tribeca Truffles, No. 450 was snapped up by Related in 2019 for $260 million. (The building was rent regulated because of a tax-abatement program, but the program expired after a decade, making it easier to vacate, though some tenants stayed on.)

The pace of sales for what is there appears speedy, about 15 deals a month in 2023.

Both developments sit on land that is not owned by the people who live upstairs but is leased from a third party, a factor that can make some buyers uneasy but often results in lower asking prices. Related also shrewdly took steps toward beginning the projects before a change in laws that made conversions much tougher.

Still, the fact that buyers flocked to the projects despite persistently high home-loan costs has left Related executives bullish.

Next, Related renovated the full-block site at Desbrosses Street from top to bottom, reducing 291 units to 172 in order to create larger living spaces, as well as upgrading the windows, facade and common areas.

Sales of the co-ops, which began at the end of 2022, are expected to generate a haul of $534 million, according to the offering plan.

The land under the full-block site is owned by Ponte Equities, a family firm that controls many sites near the West Side Highway. The lease for the ground expires in 2105, said Related Managing Director Robert Bernstein.

Though some buyers may plan to move on before concerns about lease turnovers threaten property values, others with longerterm plans seem hopeful the coop could eventually buy the land from the Pontes, Bernstein said, adding “anyway, they don’t seem deterred by the ownership structure.” The least-expensive co-op there this week was a studio listed at $790,000.

Function like condos

Tribeca Green, at 210 Warren St., presented fewer hurdles in a sense. Though the state authority that developed Battery Park City owns the land and collects rent, Related already owns the 24-story building after developing it in 2004. The developer didn’t tweak the unit mix too much. An apartment on the 17th floor became a space for billiards and other amenities. But the building has about

the same number of homes as it did before, 265 now versus 274 then.

Under the terms of most modern-day conversions, renters have the option to stay, and several have; 71 apartments still have tenants, Deighton said. Ultimately those will likely be rehabbed and sold.

But in the meantime, the pace of sales for what is there appears speedy, about 15 deals a month in 2023, he added. “And not all our buyers were cash buyers,” he added. Co-ops at Tribeca Green start at $875,000, the price of a onebedroom. Total sales are supposed to hit $375 million, its offering plan says.

Though co-ops, both Tribeca Green and 450 Washington function like condos, such as having looser rules about subletting than

most co-ops do. Closings at both began last year.

Among the elements of 2019’s Housing Stability and Tenant Protection Act was a stipulation that developers converting rentals sell 51% of units to tenants, a much higher bar than before. But Related appears to have filed plans for both projects days before the law kicked in, public records show.

In Manhattan last year, the median sale price for co-ops and condos was $1.15 million, down slightly from the $1.195 million in 2022 but still above the $1.095 million median of 2019, according to Douglas Elliman.

Yet activity dragged. There were 9,827 co-op and condo sales in Manhattan in 2023, a sharp drop from the 13,662 in 2022 but also below the 10,048 of 2019, Elliman said.

Prominent Queens developer plans a pair of residential buildings at the former site of a pool club in Flushing

By Eddie Small

The developer behind the tallest building in Queens has revealed his plans for the site of a former outdoor pool in Flushing.

Chris Jiashu Xu of Corona-based United Construction & Development recently filed plans with the city for a pair of residential buildings at the former North Flushing Pool Club with 95 total units. A project addressed at 140-28 31st Drive would have 47 residential

Both buildings would span about 56,000 square feet and stand 4 stories and 40 feet tall.

units and 44 parking spots, and one addressed at 141-05 32nd Ave. would have 48 residential units and 47 parking spots. Both buildings would span about 56,000 square

feet and stand 4 stories and 40 feet tall, according to the plans. A representative for Xu did not respond to a request for comment by press time.

The development site at 141-01 32nd Ave. hit the market in March, and Xu's firm bought it in July for $16 million, property records show. The company filed demolition permits for it earlier in February.

Several projects in Queens

The block-through lot spans about 36,000 square feet, and Development Site Advisors, the firm that marketed it, described it as a perfect location for constructing two buildings.

“Our families have enjoyed the pool club since 1960,” Linda Meltzer, a board member of the club, said in a press release at the time. “We are now looking forward to passing the torch to a developer who can bring fresh ideas and continue to make positive contributions to Flushing.”

Xu has several projects in Queens, most notably the Skyline Tower in Court Square.

450

The North Flushing Pool Club COSTar

New congressional district maps do little for Democrats

By Nick Garber

New York’s Independent Redistricting Commission agreed on new proposed maps for the state’s congressional districts this month, marking another milestone in a messy two-year process. The new lines would make notably minor changes to the existing districts, giving a slight edge to Democrats in two contested House seats and Republicans in another.

The Democratic-controlled state Legislature may still reject the maps and draw their own, which could shift as many as six Republican-held swing seats in Democrats’ favor — with profound implications for control of Congress after November’s general elections. With Democrat Tom Suozzi’s win on Feb. 13, Republicans hold 219 house seats to Democrats’ 213.

But it now appears possible that New York Democrats will simply adopt the commission’s maps, avoiding a legal battle like the one

court-appointed special master in 2022. Commissioners made few changes to other swing districts that Democrats had hoped to tilt in their favor: Republican Mike Lawler’s Hudson Valley seat, Nicole Malliotakis’s on Staten Island and Brooklyn, and three GOP-held districts on Long Island.

“We came into existence to solve these kinds of problems, and the only way they can happen is through cooperation and compromise,” said Charles Nesbitt, the commission’s Republican chair.

But big questions remain about when and how the state Legislature will vote on the maps. Lawmakers are not scheduled to return to Albany until Feb. 27, the same day that candidates are supposed to begin collecting petitions to appear on this year’s primary ballot. That has led some observers to speculate that the June primaries for Congress could be delayed until August, as they were in 2022.

State Senate Majority Leader Andrea Stewart-Cousins revealed little in a statement, saying her body is “eager to review the proposed map” and adding that she was “mindful of the election cycle calendar.”

“We came into existence to solve these kinds of problems, and the only way they can happen is through cooperation and compromise.”

Charles Nesbitt, the Independent Redistricting Commission’s Republican chair

that derailed the process in 2022.

The maps released Feb. 15 by the bipartisan 10-member commission would disadvantage Syracuse-area Republican congressman Brandon Williams by adding the blue city of Auburn to his district. But Hudson Valley Democrat Pat Ryan would get a slightly safer seat in what had been a major swing district, as would neighboring Republican Marc Molinaro.

Otherwise, the maps are nearly identical to those drawn by a

One Hudson Valley state senator, Democrat James Skoufis, has already pledged to vote against the maps, which he criticized for protecting incumbents from both parties.

Another Democratic state lawmaker, who asked to remain anonymous, predicted that fellow rankand-file members would push back if Assembly and Senate leaders simply go along with the commission’s plan in order to avoid a Republican lawsuit.

“When other states have free rein to redistrict, New York is going to just take a pass?” the lawmaker

told Crain’s. “I think that members are going to be agitated, to say the least, if the changes are as de minimis as have been reported and we’re asked to just give a thumbsup.”

Indeed, New York’s highest court, which struck down the Democrat-friendly maps in 2022, now leans more liberal under Chief Judge Rowan Wilson and appears likelier to support the Legislature’s maps. The court sided with Democrats by ruling in December that New York had to reopen its redistricting process, holding that New York could not reuse the court-drawn maps from 2022.

“I don’t think they should be afraid of a lawsuit,” the state lawmaker said Feb. 15. “We’ve got the Court of Appeals directing them to do this and basically giving us a blank check to redraw.”

The commission’s map, if adopt-

The MTA wants to make your subway station brighter… by 2026

By Caroline Spivack

Transit officials are flipping the switch on brighter LED lighting throughout the subway system by 2026, in an effort to make riders feel safer navigating dimly lit stations and corridors.

The new initiative will swap out the subway system’s 150,000 fluorescent lights with new LED fixtures to save the Metropolitan Transportation Authority an estimated $6 million annually in electric bills, according to the agency. Brighter subway stations will also make it easier for the system’s 15,000 cameras to capture clear video of crimes that do occur, said transit officials.

“This might seem like a small thing to some, however, it is huge in terms of the message that we’re

trying to convey,” said Demetrius Crichlow, New York City Transit’s senior vice president of subways, at a Feb. 20 news conference.

“Your platforms, mezzanines and staircases will now be lighter and brighter and that will give the sense of comfort that the system is more safe.”

Prioritizing stations

To date, the Bergen Street and Carroll Street stations on the F and G lines have been tricked out with the new lights, along with the Lafayette Avenue station on the C line.

Next up is the Clinton–Washington Avenues station on the A line. Stops that are being targeted by the MTA’s “Re-NEW-vation” program to clean and refurbish sta-

tions will be prioritized for the new lights, according to the authority. The agency will also target stations with a history of rider complaints about poor lighting.

It will take roughly two and a half years to install the new lighting at all 472 subway stations because the light fixtures will need to be rewired to accept LED bulbs, said Crichlow.

The LED upgrade is the latest MTA initiative geared toward luring riders who may be frightened of crime to venture back into the system. So far this year, the number of reported crimes in the subway system is up by 22.6% with 266 incidents, up from 217 during the same time in 2023, according to NYPD data.

In 2022, Gov. Kathy Hochul announced that the MTA would in-

ed without changes, would swing the Republican Williams’ upstate district by four percentage points in Democrats’ favor, said Dave Wasserman, an analyst for Cook Political Report, in a social media post. Fellow incumbents Ryan and Molinaro would see similar swings toward their own parties.

Few downstate changes

Downstate, the commission made few changes. The Democratic primary contest between incumbent Jamaal Bowman and Westchester County Executive George Latimer could have been reshaped by new lines, but commissioners made no changes to the seat. And the Manhattan district that radically combined the Upper East and West Sides in 2022, putting longtime Congresswoman Carolyn Maloney out of a job,

would be unchanged under the commission plan.

The once-a-decade redistricting process, set in motion by the 2020 Census, devolved into disorder in 2022 when the independent commission, a creation of ex-Gov. Andrew Cuomo, failed to agree on a new set of maps, which thrust the decision to the state Legislature.

From there, state Democrats designed districts that would have heavily benefited the party, prompting Republicans to sue, claiming an unconstitutional gerrymander. In April 2022, the state’s top court unexpectedly sided with Republicans, ruling that new lines were needed. Those maps, ultimately drawn by neutral special master Jonathan Cervas, likely helped Republicans flip four seats in New York on their way to winning control of the House of Representatives.

stall two security cameras on each of the subway’s 6,500 train cars; as of February roughly 1,000 subway cars have been equipped with the new cameras. Hochul and Mayor Eric Adams also pledged to increase police presence in the subway with the addition of thousands of officers patrolling the

system.

Meanwhile, daily weekday subway ridership has remained stubbornly stuck at about 70% of preCovid-19 levels, MTA ridership data shows.

“Riders are going to see a difference,” said Crichlow. “Not only will it feel safer, it will be safer.”

The Lafayette Avenue station on the C line is one of the first subway stations to get brighter LED lighting to make riders feel safer. | MARC A. HERMANN / MTA

The Democratic-controlled state Legislature must now decide whether to accept the independent commission’s maps, or reject them (again) and draw their own, which could give Democrats a bigger boost in November. | BLOOMBERG

Mount Sinai Health System slapped with $2 million in penalties for nurse understaffing at three hospitals

By Amanda D’Ambrosio

Mount Sinai Health System was hit with more than $2 million in fines in recent weeks for understaffing in emergency, oncology and labor and delivery departments at three hospitals, the labor union New York State Nurses Association said Feb. 20.

Mount Sinai Morningside, Mount Sinai West and Mount Sinai Hospital were hit with a combined $2 million in penalties for short-staffing nurses in a handful

nai Hospital to pay $240,000 for short staffing in one of its oncology units, Mount Sinai West to pay $957,000 for low staffing in labor and delivery, and Mount Sinai Morningside to pay nearly $934,000 for short staffing in the emergency room. The hospitals are required to pay the fines to nurses who worked in understaffed settings.

The recent arbitrations mark the eighth time that Mount Sinai Health System was ordered to pay fines for violating staffing ratios in nurse contracts. Mount Sinai has racked up more than $3 million in penalties so far, according to the union.

“Hospitals everywhere have grappled with nursing and other health care worker shortages.”

Stacy Anderson, a spokeswoman for Mount Sinai Health System

of departments. Current staffing practices violate contracts between the health system and NYSNA that include nurse-to-patient ratios and enforcement protocols that went into effect at the beginning of last year, union leaders say. An arbitrator ordered Mount Si-

Despite these penalties, hospitals have continued to understaff units. The recent violation at Morningside, which was cited on Feb. 2, follows a $37,000 fine that the hospital incurred in June.

The arbitrator found that staffing practices have not improved and the hospital has not hired enough new nurses in the last six months.

Morningside hired five additional emergency room nurses since the first violation — short of the 14

nurses a month that the hospital needs to hire to get up to speed, said Sheryl Ostroff, a registered nurse who has worked in the ED at the hospital for 21 years.

During some night shifts, ER nurses at Mount Sinai Morningside could be assigned anywhere between 15 to 20 patients, Ostroff said. Ideally, nurses in the emergency department should be assigned four to six patients, she added.

“We probably function at 60% of our staff, every shift,” Ostroff told Crain’s, adding that one nurse is responsible for the jobs of three or four people because of staffing issues.

Health care worker shortages

Stacy Anderson, a spokeswoman for Mount Sinai Health System, said that “hospitals everywhere have grappled with nursing

and other health care worker shortages.”

“We are confident that Mount Sinai is appropriately resourced to provide excellent care as we continue to recruit top caregiver talent and maintain the highest standards of clinical quality for our patients,” the spokesperson said.

The union said that public hospital system New York City Health + Hospitals has hired 600 additional nursing staff since reaching

a contract with NYSNA in July of this year, proving that it is possible to recruit and retain nurses.

Ostroff said that while staffing challenges persist, the union will continue to track staff shortages and draw attention to the impacts on patient care.

“I understand that this is going to take time to fix, but at least this is a way for us to say ‘Hey, this is a win,’” Ostroff said. “All we really want is safe staffing.”

Mount Sinai Hospital, Mount Sinai Morningside and Mount Sinai West have been hit with more than $2 million in staffing penalties in recent weeks, the New York State Nurses Association said Feb. 20. MOuNT SINaI HeaLTH SySTeM

Trader (Citadel Securities Americas Services LLC – New York, NY)

Mult. pos. avail. Offer’ng salary of $140,000 to $225,000 per year. Monitor & analyze incoming market information, economic news & trad’g activity to manage portfolio risk, identify investment opportunities & make trad’g decisions. F/T. Reqs a Bachelor’s degree (or foreign equiv) in Fin, Econ, Math, Eng, CompSci, Phys, or a rel quant field. Edu, train’g, or exp must incl the follow’g: work’g in a data-driven quant trad’g envirnmnt; financial & statistical modell’g incl time-series analysis; work’g in financial mrkts with derivative pricing; programm’g & script’g languages includ’g Python, R, C++, or similar; stat tools incl R, Matlab, or similar; & analyz’g large data sets & other informational input to inform investment or trad’g decisions. Resumes: citadelrecruitment@citadel.com. JobID: 7997474.

Software Engineer (Citadel Securities Americas Services LLC – New York, NY) Mult. pos. avail. Offer’ng salary of $150,000 - $225,000 per year. Design & build SW components that are foundational to research & trad’g activities. F/T. Reqs a Bach degree (or foreign equiv) in Comp Sci, Engineer’g, or a rel field. Edu, train’g, or exp must incl the follow’g: object-oriented programm’g & design; end-to-end SW dvlpmnt; C, C++, C#, Java, Python, or Perl; statistical analysis; R, Matlab, SAS, or S-Plus; data structures, algorithms, & comp architecture; & Machine Learn’g techniques. Resumes: citadelrecruitment@citadel.com. JobID: 7997473.

Director of Post Automation positions at NBCUniversal Media, LLC in NY, NY. Lead team of engineers & SW developers resp for designing & implementing Post workflows & automation for on-prem & cloud-based apps. Hybrid work sched. Salary range is $165,000/yr - $200,000/yr, depending on qualifications. Send resume to: Elsbeth Velasco-Fulgencio at elsbeth.velasco@nbcuni.com, & indicate you are applying for the Director of Post Automation (PC24LN) opening. NBCU is an EOE.

Application Engineer positions (WarnerMedia Services, LLC; NY, NY). Respond to app & platform support issues reported by teams across company. May work remotely w/in commuting distance of reporting office in NY, NY. Salary range is $147,285/yr - $160,303/yr, based on qualifications. Email resume to wbdi@wbd.com. Ref: 7369737AE2.

Account Manager (Pacific Investment Management Company LLC (PIMCO) – New York, NY); Mult. pos. avail. Monitor portfolios and comm invstmt strat by providing info on perf attribution, market perf, and macroeconomic conditions. Outline firm’s current outlook and strat, dev invstmt objectives, and edu clients on a broad set of invstmt strategies, prod, and svsc. F/T. Sal range $190,000 to $220,000/yr. Apply w/ resume to Lupe.Rubalcaba@pimco.com. Ref. Job ID: 7039555.

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Vice President, Account Manager (Pacific Investment Management Company LLC (PIMCO) – New York, NY); Mult. pos. avail. Offered salary of $210,000 to $240,000/year. Provide client service to institutional investors w/i Latin America & the Caribbean, such as pension funds, endowm’ts, foundat’ns, gov. entities, corporates, single family offices & others. Eval. portfolio structures & deliver attribut’n analyses as well as market performance & outlook to investm’t professionals & clients. F/T. International travel required up to 20% of working time. Apply w/ resume to lupe.rubalcaba@pimco.com. Ref. JobID: 6724012.

Portfolio Associate (Pacific Investment Management Company LLC (PIMCO) –New York, NY); Mult. pos. avail. Duties incl: Dev. & enhance PIMCO’s internal apps. supporting PIMCO’s portfolio mgmt. & trading activities. Resp. for providing key spprt. across portfolio mgmt. & trading desks, incl. global portfolio risk reporting, attribution analysis, & trade allocation. F/T. Offered sal. range $105,000–$122,500/yr. For complete details or to apply, send resume to Lupe.Rubalcaba@pimco.com. Ref. JobID: 6542694.

Senior Software Engineer positions (WarnerMedia Services, LLC; NY, NY). Design, dev’p, implement, test, document & deliver large-scale, multi-tiered, distributed or embedded SW apps, tools, systems & services us’g Object Oriented programm’g, distributed or embedded program’g, relational DB &/or rltd tech in Linux, Unix, or rltd sophisticated platform or operat’g syst in an Agile environ. Position is fully remote & may be performed from anywhere in U.S. Salary range is $169,229/yr. - $195,000/yr., based on qualifications. Email resume to WBDI@wbd.com. Ref: 6439654SSE2.

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Wildlife Conservation Society (WCS) Request for Proposals Architectural/Engineering Services, Central Park Zoo, Colonnade/Pergolas, Proposal Due Date: April 2, 2024 (Electronic submission to bids@wcs.org).

Pre-Bid Conference Site Visit (In Person): March 12, 2024. The project is funded by the City of New York through its Department of Parks and Recreation and is subject to certain NYC requirements And WCS policies. For a copy of the RFP please email bids@wcs.org PUBLIC

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comment on whether any real estate changes are planned as a result of the new office and pointed out that New York City, which has 14,000 of its employees, is a bit of an anomaly. Google also said the 3,000-worker figure is just a starting point for St. John’s.

But the firm, which is unique in the Big Tech world for the scale of its real estate investments, does appear to have excess space at certain buildings, including three that encompass entire city blocks. What’s new

Redeveloped over the past couple of years for an undisclosed amount, St. John’s, the only property built completely to Google’s standards, now features nine glassy stories atop three prewar floors that remain from the days when the structure there was the end of the line for High Line freight trains. The outlines of preserved former track beds form ziggurat patterns on the building’s northern façade.

The gardens, filled mostly with species native to New York City and offering pergola-covered meeting areas, are complemented by eco-friendly touches such as a 100-kilowatt solar panel array, a 92,000-gallon rainwater retention system and a 500-space bike parking area. There’s also a 2-story auditorium that can host public events, a reflection of the recent trend of installing amphitheaters as amenities in office towers.

Gensler was the lead interior architect on the project.

Facing a stretch of West Houston Street that was tunneled over for decades but is now open to the sky after a demolition, the site also seems to be Google’s attempt to reinvent traditional notions about office layouts. Instead of clustering floors by department, St. John’s opts for a “neighborhood seating model” that groups together teams based on projects. When employees report to work on Feb. 26, there will be 60 of those neighborhoods with up to 50 workers each, none of whom will have an assigned desk, the company said. Employees focused on ad sales and finance will work there.

Everybody may not need to be on site all the time, however. The

company’s “Project Starline” screen technology, a lifelike interface that recalls Zoom by way of Avatar, could make it easier to work remotely. As it is, Google’s hybrid-work policy allows employees to work from home two days a week.

Though the space offers an unusually generous amount of legroom for each worker, the development also encompasses myriad amenity spaces and common areas. There’s a ground-floor coffee bar, a store selling Google merchandise, and a wide and gently rising central staircase on which to hang out.

“If we had done this a few years earlier, we would have approached things very differently,” said Google Vice President Jennifer Kelly in a video to promote the site. “It gave us an amazing opportunity to just stop and think about how we can best build our space for how people want to work.”

Deep, wide roots

Founded in 1998 by Larry Page and Sergey Brin, the search-engine startup had a minimal New York presence at first, with a single ad sales person working out of an Upper West Side coffee shop, according to the company. And when it finally sought more formal space, it landed at a very un-Silicon Alley address, 1440 Broadway, a Midtown building near Bryant Park whose retail space today holds a CVS. That lease initially consisted of a single floor, although Google quickly expanded to multiple stories there.

From nearly the beginning, Google’s real estate strategy has been consistent: First, test a building by leasing part of it, then acquire the whole thing to keep rent increases at bay.

Indeed, in 2005 Google leased 270,000 square feet at 111 Eighth Ave. in Chelsea, the full-block former home of the Port Authority that housed many high-powered computer servers at the time.

Five years later, after apparently cottoning to its time in an emerging business district, Google snapped up the nearly 3 millionsquare-foot site for $1.8 billion in one of New York’s largest-ever single-building transactions. The company is far and away still the main tenant in the building, but there are a handful of others, including a medical center in a

ground-level berth on the West 15th Street side.

Similarly, in 2018 Google was leasing 400,000 square feet across the street in the upstairs offices at Chelsea Market when it purchased the former cookie factory from the developer Jamestown and its partners for $2.4 billion. The site is not just about Google—there are a handful of other office tenants plus many retailers in a popular food hall—but the 18 interconnected buildings between Ninth and 10th avenues sweep across a notable 1.2 million square feet.

It followed the same playbook with the St. John’s site. Google had been leasing the large, wedgedshaped parcel near the Hudson River for years before closing on it for $2.1 billion in 2022, in a purchase hailed as a market savior in the sluggish deal-making days of the pandemic.

New York.

To be fair, Google continues to be a renter too, at four Manhattan sites in Chelsea and Hudson Square.

The properties include a 240,000-square-foot berth at 85 10th Ave., a 600,000-square-foot building connected by a skybridge to Chelsea Market that is coowned by Vornado Realty Trust and The Related Cos. Google also leases 350,000 square feet at nearby Pier 57, an RXR-led redevelopment where Google is the sole of-

York, “a difficult decision to set us up for the future,” Pichai said then.

But the company was not done cutting, though on a smaller sale. In January Google said it would let go of an additional 225 employees in New York, all of them at the Chelsea sites, by spring.

The layoffs come amid a broader reckoning for the tech industry, which shed about a quarter-million jobs in 2023, according to the website TechCrunch, which added that January saw 1,000 more job losses.

The gardens are complemented by eco-friendly touches such as a 100-kilowatt solar panel array, a 92,000-gallon rainwater retention system and a 500-space bike parking area.

In deciding to buy rather than rent, CEO Sundar Pichai may have relied on some simple math. If then-owner Oxford Properties had gone ahead and redeveloped the bare-bones industrial site, the resulting office building could have cost Google $100 per square foot annually, or $2.6 billion in rent costs over a 20-year term, brokers say. Paying $2.1 billion to control the place outright likely seemed more compelling, though construction costs on the project, which was delivered in 2022, might have ended up higher than anticipated due to inflation.

Owning as opposed to leasing may be a great way to hedge against rising rents. But when a market tanks, as the office sector has in recent years, the plan can backfire.

Fellow Big Tech firm Amazon’s purchase of the Lord & Taylor department store on Fifth Avenue in early 2020 for $1.2 billion initially seemed like a spectacularly illtimed move, as the pandemic raged and workers stayed home.

Employees finally began working in the renovated building last year, according to news reports. But Amazon, like Meta, Microsoft and LinkedIn, seems to prefer the flexibility that renting allows and mostly leases its other spaces in

fice tenant.

In Hudson Square, meanwhile, Google has 400,000 square feet at 315 Hudson St., a Jack Resnick & Sons-owned former candy factory containing a total of 483,000 square feet. Since 2018 Google has also leased about 20% of 345 Hudson St., a 980,000-square-foot former printing press site owned by a group that includes the firm Trinity Real Estate.

If Google does end up trimming its portfolio in New York, as elsewhere, the leases might be the most obvious targets. And its peers offer precedents. Facebook parent Meta announced in February that it would not renew a lease for 275,000 square feet at 770 Broadway in the East Village, a Vornado-owned site where Meta controls most of the space.

Similarly, listings site Yelp announced in 2022 it would pull out of SL Green Realty Corp.-owned 11 Madison Square and try to sublet its 200,000 square feet of offices there instead.

Cutting mode

Google has clearly thinned its ranks. Of the companywide layoffs in 2023 that eliminated 12,000 national positions, many in ad sales, Google slashed 887 jobs in New

But Google points out that its total New York headcount of 14,000 reflects a doubling of payroll in six years; the company eventually replaced jobs that were cut and added others, it says.

Google and Alphabet have seen personnel changes on the real estate front as well.

Jay Bechtel, who handled Bay Area deals for the company for two decades, was let go last year. Similarly, Paul Darrah, who handled New York-area transactions, including the Chelsea Market and St. John’s deals, left for the hedge fund Citadel in February after seven years at Google.

Though the downsizing may be stinging workers, the markets seem to like what they see. Alphabet’s stock price closed Feb. 16 at $144, representing a mostly steady increase in value for the shares since the job cuts began a year ago. And Google’s fourth quarter revenue haul was $86.3 billion, up 13% in a year.

On the West Coast, Google announced last year it would sublet space in seven office towers in Mountain View and Sunnyvale, California, parcels representing 1.5 million square feet, though Google’s Bay Area portfolio is around 30 million square feet.

Last fall the company also cut ties with Australian developer Lendlease, which was supposed to build four California mega campuses, including one that was to be part of a massive, 80-acre, $1 billion mixed-use project in San Jose called Downtown West. Construction of that project stopped last spring, though it is supposed to resume this month.

Google bought 111 Eighth Ave. for $1.8 billion in 2010. | BUCK ENNIS

New Northwell transplant director on ensuring access to more patients

The state’s transformation plan for SUNY Downstate’s Brooklyn hospital campus could involve layoffs and a “major restructuring” of hospital services that could shutter one of the most active transplant programs in the city. That would leave other hospitals to absorb patients who already face long waiting lists for organs and a state registry system that needs improvement.

In light of this, Dr. Niraj Desai, the new director of the kidney transplant program at Northwell Health’s Transplant Institute, spoke to how Northwell and other area hospitals could ensure access to care for former Downstate patients. Desai, who led kidney and pancreatic transplant services at the Johns Hopkins School of Medicine for about 14 years before coming to North Shore University Hospital where the institute is located, has pioneered novel ways to make sure more patients can get new organs, including studying whether hepatitis C-positive organs can be used for individuals who don’t have the infection.

While there are inherent challenges to the transplant process that would make a SUNY Downstate closure difficult, Desai told Crain’s patient education and collaboration with other hospitals could be the lynchpin to maintaining access for patients.

By Jacqueline Neber

What can you do about long transplant waiting lists, as a doctor?

[Waiting lists] have grown so much. We always want to encourage living organ donation. When we have a recipient we want to look and see what possibilities there are for somebody to give them a living kidney. There are some advantages to that: not having to wait, and typically a much better quality organ, and as a result a smoother operation and smoother recovery.

From the perspective of increasing the number of folks that are registered to be organ donors…I think the most important thing there is awareness and education. There is a misperception that when someone has signed up to be an organ donor that they won’t get the full amount of care, and nothing could be further from the case. It’s only when [care] becomes futile, or they’re actually brain dead, does the topic of organ donation come up. So it’s really combating that misperception.

The other aspect of it is we have to do our best to optimize [donated organ] use. We have to do what we can to push the boundaries of what we can use and use successfully.

Given these waiting lists and misperceptions, would it be challenging for Northwell and other health systems to absorb transplant patients if SUNY Downstate closes?

It’s kind of a complicated answer in that [for] the patients that are listed at SUNY Downstate currently, there’s no automatic process to getting them put on another list. Other centers would have to list them at their center. If we were referred a patient that’s on the SUNY Downstate list in the event that the program closes, we would be able to evaluate and list that patient and hopefully it would be a relatively smooth and easy process—but it’s not an automatic transfer.

There are currently 221 patients listed at SUNY Downstate. My greatest concern is

of already being sick with kidney failure, and making it on the list and then having that feeling of the rug being pulled out from under you because the hospital can no longer offer that service. That will discourage some as well. It won’t change the list dynamics, but it will incrementally grow the list of the surrounding centers that get those patients.

“There are currently 221 patients listed at SUNY Downstate. My greatest concern is of that 221, how many can actually make it onto another list?”

of that 221, how many can actually make it onto another list? Inevitably some will drop off because of geography, difficulty getting elsewhere, frustration…That aspect

What are some solutions?

Hopefully, most of those patients can get on another list and be candidates and eligible to be transplanted. Our role would be to do the best we can to give them access to transplant services. If [Downstate] closes patients will have to go elsewhere for operations. But evaluations, follow-ups…If we have outreach clinics there...That can smooth and facilitate that process. We’ve already had something in Brooklyn near there for our liver program. A similar thing

for our kidney program would be something that we would aim to set up. We have a collaboration at [New York City Health + Hospitals] King’s County for our liver program, that’s across the street. In a similar way that could be done. I’m sure [hospitals] in Manhattan do as well, especially on the east side. Perhaps NYU or Sinai will look to do that as well. We want to help those individuals continue getting access to transplant services, and we can do our best to reach out and have clinics there.

Does Northwell plan to launch new programs at the transplant center?

Pancreas [transplantation] is something that will be starting up this year. It is a good complement to the kidney patients that are appropriate for a pancreas as well, mostly patients with type 1 diabetes that also have renal failure and then some patients with type 2 diabetes if they meet certain criteria. The aim [is to do both transplants] at the same time.

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Dr. Niraj Desai is the new director of the kidney transplant program at Northwell Health’s Transplant Institute. NOrTHWeLL HeaLTH