Crain's New York Business by crains-new-york-business

NEW MOVES Dancers take altruistic turn as venues remain closed

ASKED & ANSWERED Madruga on bringing big projects to wary communities PAGE 6

PAGE 3 CRAINSNEWYORK.COM

JANUARY 11, 2021

2021

ECONOMIC

FORECAST The city’s recovery depends on how fast it can put the pandemic behind it

ISTOCK

PAGE 7

CORONAVIRUS

Should businesses mandate that staff get the Covid vaccine? Employers seek a safe return to work, but forcing the issue may not be feasible BY SHUAN SIM

NEWSPAPER

VOL. 37, NO. 1

hen the Pfizer and Moderna Covid-19 vaccines became available to health care workers in December, hospitals and nursing homes didn’t expect pushback from employees. But an estimated 30% of health care workers are now expected to refuse the shots, according to health officials. “What do you do if your own workers refuse

the vaccine?” asked Michael Balboni, executive director of the Greater New York Health Care Facilities Association, a nonprofit serving the needs of long-term-care facilities. “Do you just take people off the schedule if they refuse? Can we require them to take the vaccines?” Updated guidance from the Equal Employment Opportunities Commission issued Dec. 16

did not necessarily provide clarity. It stipulated that an employer can lawfully exclude a worker who cannot be vaccinated due to disability or religious convictions from the workplace if it cannot provide reasonable accommodation. The guidance gave employers the option of a

SMALL-BIZ SPOTLIGHT

ALL-NATURAL BRAND TURNS SPRINKLES INTO CASH PAGE 23

See VACCINE on page 18

THE LIST

The top commercial property sales PAGE 16

POLITICS

In reversal, Cuomo backs online sports gambling to boost state revenue BY BRIAN PASCUS

ation of thousands of new jobs in the hotel and entertainment industries that have been devastated by the pandemic,” Wylde said. Sports gambling, or wagering, is legal online in 14 states and in four commercial and Native American facilities in parts of upstate New York, the governor’s office said.

Big bucks

GOVERNORANDREWCUOMO/FLICKR

CUOMO

Covid-19 pandemic, the current online sports-wagering structure incentivizes a large segment of New York residents to travel out of state to make online sports wagers or continue to patronize black markets,” Cuomo said. An industry study found that close to 20% of New Jersey’s sports gambling revenue comes from New York residents, the

“THE CURRENT STRUCTURE INCENTIVIZES RESIDENTS TO TRAVEL OUT OF STATE” get gap. “At a time when New York faces a historic budget deficit due to the

governor’s office said. “Properly regulated sports betting is an appropriate source of revenues and entertainment, and there is no reason that New Yorkers should not enjoy those benefits as much as other states that have subsequently legalized the practice,” said Kathryn Wylde, president and CEO of the Partnership for New York City. The organization added that it hoped the decision by the governor would hasten the development of a

BLOOMBERG

casino in the city. “Hopefully, approval of a competitive process to authorize the development of three casinos in New York City will follow, with a similar rationale, but also adding the cre-

REAL ESTATE

WEBCAST CALLOUT

SL Green sheds commercial spaces in Williamsburg for $32 million BY NATALIE SACHMECHI

BUCK ENNIS

L Green, the city’s largest office landlord, has sold off three commercial units at a Williamsburg condo building to Ethika Capital for $32 million, property records show. The deal includes a parking garage and two retail spaces beneath the Williamsburg THS Condominium at 195-205 Berry St., a 72unit, 44,000-square-foot multifamily building. SL Green previously held a 90% share in the residential portion of the property with its partner, Magnum Real Estate Group, but Green sold it for $55 million in 2016. It was purchased for $54.9 million in 2012 along with 12 townhomes. The townhomes have since been sold off, but the Marc Holliday–led real estate investment trust retained its share in the commercial properties at the condo building until it closed on the deal with Ethika in late December.

State Sen. Joseph Addabbo Jr. initially proposed legalizing online sports gambling in New York. Addabbo’s bill would implement an 8.5% tax on sports-wagering gross revenue and would require a licensing fee of $12 million for each agent or company that’s allowed to conduct mobile betting. Addabbo estimated the legalization of gambling on p ro f e s s i o n a l sports would bring $1 billion in revenue per year. “It moves the ball ever closer to the goal line,” Addabbo said, referring to his bill. “It’s going to be about the details. I’m hopeful we can work with the governor’s administration on this.” ■

The company has suffered several blows since the onset of the pandemic, including a failed deal to sell the Daily News Building to the Chetrit Group, a 60% drop in share prices between February and April, and a rise in residential vacancies. Although it signed 33 leases between July and September, the firm has had to offer more concessions

and free rent to lure tenants, its third-quarter earnings report showed.

‘Cash is king’ This year the REIT announced it would begin a campaign to offload assets to raise cash, improve its liquidity and reinvest in its share repurchase program. “In the current environment,

cash is king,” Chief Financial Officer Matthew DiLiberto told investors during a first-quarter earnings call. In May SL Green sold half of its stake in 1 Madison for $500 million to a South Korean pension fund and Hines, a real estate investment firm. By June it went into contract to sell its stake in Stonehenge 58, a 16-story, 126-unit building at 400 E. 58th St., for $62 million, clearing $20 million in cash for the firm. Late last year it was announced that its massive, Amazon-anchored Class A office development at 410 10th Ave. would be sold for nearly $1 billion to 601W Cos. “While the asset was always intended to be held as a long-term investment, the sale will allow the company to achieve extraordinary profits, substantially reduce consolidated indebtedness and generate additional liquidity for share repurchases,” said Brett Herschenfeld, managing director of SL Green, in the announcement. ■

CRAIN’S BUSINESS FORUM BUCK ENNIS

ov. Andrew Cuomo has announced his support for online sports betting across New York state, paving the way for casinos to open in New York City. “New York has the potential to be the largest sports-wagering market in the United States,” Cuomo said, “and by legalizing online sports betting, we aim to keep millions of dollars in revenue here at home, which will only strengthen our ability to rebuild from the Covid-19 crisis.” The governor’s motivation appears to be a new avenue for revenue, as the state faces a $46 billion budget deficit in the next four years. New Yorkers have been able to travel across the Hudson River to New Jersey or travel down the highway into Pennsylvania to gamble online legally. Cuomo had previously opposed using gambling to bridge the bud-

MARCH 3 DANIEL L. DOCTOROFF FOUNDER AND CEO OF SIDEWALK LABS Daniel L. Doctoroff is the founder and CEO of Sidewalk Labs, an Alphabet company that works with cities to build products that address big urban problems. Before launching Sidewalk Labs, he was the CEO and president of financial news and information company Bloomberg LP. From 2002 to 2008, he served as New York City’s deputy mayor for economic development and rebuilding.

VIRTUAL EVENT Time: 4 to 5 p.m. Register at CrainsNewYork.com/ MarchBizForum

Vol. 37, No. 1, January 11, 2021—Crain’s New York Business (ISSN 8756-789X) is published weekly, except for bimonthly in January, July and August and the last issue in December, by Crain Communications Inc., 685 Third Ave., New York, NY 10017. Periodicals postage paid at New York, NY, and additional mailing offices. Postmaster: Send address changes to: Crain’s New York Business, Circulation Department, PO Box 433279, Palm Coast, FL 32143-9681. For subscriber service: call 877-824-9379; fax 313-446-6777. $3.00 a copy; $129.00 per year. (GST No. 13676-0444-RT) ©Entire contents copyright 2021 by Crain Communications Inc. All rights reserved. 2 | CRAIN’S NEW YORK BUSINESS | JANUARY 11, 2021

POLITICS

ARTS & CULTURE

CAREERS T AT A STANDSTILL Dancers have found other productive work to stay busy during the pandemic

BY AARON ELSTEIN

he show must go on. But what’s a performer to do when it can’t? That question has tormented tens of thousands of actors, singers and dancers around the city since theaters, clubs and studios shut down 10 months ago. Leal Zielinska, a dancer at Gibney Company, is fortunate to have an answer. She expects to grace the stage again in the fall, when the modern-dance troupe plans to finally reopen its doors. Until then Zielinska is devoting her energy to providing free counseling to dancers struggling to cope with the loss of their community and livelihood. Since April her nonprofit organization, called Okay Let’s Unpack This, has enlisted about 30 therapists to provide one-on-one mental health counseling to 70 dancers on a first-come, first-served basis. Group sessions recently became available. The cause is close to the heart of See DANCERS on page 19

High hopes for New York’s recovery ride on Schumer Democratic control of the Senate gives the Brooklyn lawmaker greater power BY BRIAN PASCUS

xpectations are high for Sen. Chuck Schumer to bring home the bacon to his city and state after the Democrats took control of the U.S. Senate. Schumer is poised to become Senate majority leader following election victories in Georgia. “It bodes well for the state of New York,” Gov. Andrew Cuomo said Jan. 5. “Given what happened in Georgia, I now have to rewrite the State of the State, because it’s going to be a totally different State of the State.” Schumer’s role is now seen as the most important part of the equation in how the city and state recover from the economic crisis brought on by Covid-19. New York City faces an $8.8 billion NEW YORK budget gap CITY’S budget over the next gap over the next few years due few years due to to the pandemthe pandemic ic. The state’s lockdown budget hole is $16.7 billion for the year 2022. “Schumer understands the city’s needs,” said Sal Albanese, a former city councilman. “Having that kind of power means taking care of your home state and your home city.” The senior senator will be expected to use his influence among Democrats to champion infrastructure and transportation projects that will directly aid New York City. “This is a born-and-bred straphanger who still rides the subway and lives in Brooklyn,” said Danny Pearlstein, communications director at the Riders Alliance. “He’s one of the most powerful people in the United States, and transit is having a moment right now, and it couldn’t come at a more unique time.”

$8.8B

TODD ROSENBERG

No guarantees SHIAU is developing a program to fight body-shaming.

But there is no guarantee that the expected benefits sought by New Yorkers will come to fruition. The Democrats will be faced with a closely divided Senate. The chamber is split 50-50 between Republicans and Democrats, with See SCHUMER on page 18 JANUARY 11, 2021 | CRAIN’S NEW YORK BUSINESS | 3

chief executive officer K.C. Crain senior executive vice president Chris Crain group publisher/executive editor Jim Kirk

EDITORIAL

publisher/executive editor

Mayor, governor should stop infighting and focus on getting workers vaccinated placed the blame on Mayor Bill de Blasio, accusing him of mismanagement. De Blasio, in turn, took the governor to task for threatening to fine hospitals $100,000 each for delaying distribution. New York City runs 11 acute care hospitals, and those fines could add up. What was apparent to most is that both the city and the state were unprepared to administer the vaccine with any type of urgency. It is not as if they didn’t have enough time. Approval of the vaccine candidates was telegraphed weeks in advance. Officials should have used that time to put a detailed game plan in place to get doses out to as many people as it could in the shortest time frame possible. It also should have been clear to the public from the start what the timetable would be for vaccination based on occupation, age and health status. Last Tuesday officials were still scrambling to open up more distribution sites, and most New Yorkers remained uncertain about when they would be able to get the vaccine. That became another point of contention between the governor and the mayor. Last

assistant managing editors Telisha Bryan,

Gabriella Iannetta associate editor Lizeth Beltran art director Carolyn McClain photographer Buck Ennis senior reporters Aaron Elstein, Eddie Small reporters Ryan Deffenbaugh,

Jennifer Henderson, Brian Pascus, Natalie Sachmechi, Shuan Sim executive assistant Devin Cavallo to contact the newsroom:

www.crainsnewyork.com/staff

Thursday de Blasio claimed the city-owned hospitals had inoculated all health care workers who wanted the vaccine and sought permission to use its surplus to start giving shots to essential workers, such as police and firefighters, as well as those 75 and older. Cuomo refused. It remains to be seen if the city and the state have done enough to jump-start the process, and whether they can maximize the number of vaccinated New Yorkers based on available doses. At the same time, troubling reports have come out about health care workers who are refusing to be vaccinated. That

must be addressed if nursing home residents and hospital patients, along with other employees, are to be adequately protected. Meanwhile, the business community has a role to play. It should put pressure on the governor and the mayor to stop their infighting and attack the pandemic with the only real weapon they have: the vaccine. More must be done to give New Yorkers the protection they need to get back to work and get the city’s economy back on its feet. The lives of all New Yorkers— and their livelihoods—depend upon it. ■

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www.crainsnewyork.com/events events and marketing manager

Michelle Sustar, mstustar@crain.com manager of conferences & events

Ana Jimenez, ajimenez@crainsnewyork REPRINTS

City nonprofits need help to continue to provide important social services ew Yorkers gave generously in 2020 to help their neighbors facing hardships related to Covid-19. But even though 2020 is now behind us, the need continues to rise. Donors across the city rallied to give more than $112 million through the NYC Covid-19 Response & Impact Fund, an effort that provided rapid-response relief to human services and arts and culture nonprofits. This surge in generosity is not exclusive to New Yorkers. On Giving Tuesday, nearly 35 million people donated an estimated $2.5 billion to support nonprofits nationwide, a 25% increase from 2019’s total. This comes on top of the more than $500 million donated through a special Giving Tuesday campaign during the spring in response to the pandemic. New Yorkers and the nonprofits that serve them are still facing a se-

editor Robert Hordt

audience & analytics manager

OP-ED

BY LORIE SLUTSKY

EDITORIAL

Janon Fisher

MORE MUST BE DONE TO GET THE CITY’S ECONOMY BACK ON ITS FEET through the winter months. As of last Thursday, more than three weeks after a vaccine candidate became available, the city had administered only about a third of the 490,000 doses it had on hand. It didn’t take long for the usual finger pointing to begin. Earlier in the week, Gov. Andrew Cuomo

associate publisher Lisa Rudy

BUCK ENNIS

ovid-19 is first and foremost a public health crisis, but the business community has a vested interest in bringing it under control. Until the pandemic passes, the city’s economy will continue to languish. Workers will not return to offices. Restaurants will stay closed or operate at partial capacity. Hotels and entertainment venues will remain dark. Unemployment will continue to hover in the double-digit range. That is why it has been so disturbing to see the slow rollout of the Covid-19 vaccine in New York, which was the early epicenter of the virus and is seeing a surge in new cases as we move

Frederick P. Gabriel Jr.

ries of extraordinary challenges, and it will be important for those who have the means to find a way to continue to give. Unemployment rates in the city are twice the national rate and probably higher, given the number who dropped out to care for their family. At the same time, state and local governments are facing severe budget shortfalls. New York state faces a $14 billion budget gap this fiscal year; the city faces a twoyear gap of $9 billion, so government safety-net services will almost certainly be cut. On top of that, the hard-hit performing arts and tourism industries will be slow to return, and we can expect nonprofits to struggle financially well into this year as emergency funding dries up.

Targeted giving This leaves nonprofits in a precarious position. Demand is increasing even as they have been forced to change the way they operate.

director, reprints & licensing Lauren Melesio,

212.210.0707, lmelesio@crain.com PRODUCTION production and pre-press director

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While many of us are worried about Covid-19’s direct impact on businesses, we must consider the important role nonprofits play in our economy. Nonprofits themselves are major employers and economic drivers. Our recovery depends on their recovery. If you’ve had good fortune, you can help ensure that our neighbors—and our economy—will be able to weather the dark days ahead. No matter what issues you care about, there are ways to target your giving to address this critical moment. There are a number of ways you can contribute. The pandemic continues to create challenges for students. To meet that demand, many nonprofits are working to provide broadband access to students who do not have access to reliable internet. They are working to train teachers to deliver content remotely. They are trying to provide social and emotional learning for students who are isolated and ex-

periencing heightened levels of trauma and uncertainty. Most arts and culture organizations are now nine months into a period in which they have been forced to go dark. Those who have been able to find the funding are using this time to experiment online to engage their audiences and find new ones. You can consider supporting groups focused on providing reliable vaccine education and information as well as mental health support. You can address racial justice by supporting nonprofits led by Black, Indigenous and people of color. These are just some of the ways you can help. Regardless of your passions and interests, now is the time to give locally and give generously. Give because it will be a driving force in helping our city recover. ■

www.crainsnewyork.com/subscribe customerservice@crainsnewyork.com 877.824.9379 (in the U.S. and Canada). $3.00 a copy for the print edition; or $129.00 one year, for print subscriptions with digital access. Entire contents ©copyright 2021 Crain Communications Inc. All rights reserved. ©CityBusiness is a registered trademark of MCP Inc., used under license agreement. CRAIN COMMUNICATIONS INC. chairman Keith E. Crain vice chairman Mary Kay Crain chief executive officer K.C. Crain senior executive vice president Chris Crain secretary Lexie Crain Armstrong editor-in-chief emeritus Rance Crain chief financial officer Robert Recchia founder G.D. Crain Jr. [1885-1973] chairman Mrs. G.D. Crain Jr. [1911-1996]

Lorie Slutsky is president of the New York Community Trust.

4 | CRAIN’S NEW YORK BUSINESS | JANUARY 11, 2021

P004_CN_20210111.indd 4

1/8/21 5:47 PM

OP-ED

BY RON SHERMAN

he New York City yellow taxicab industry has been in a crisis for some time now. Medallion values and ridership plummeted as the market was flooded with app-based services, such as Uber and Lyft—which have almost 10 times the volume of yellow taxis. Then, just as the industry was learning to adapt to a new reality with its own yellow apps, new leasing arrangements and maturing business models such as Access-a-Ride, Covid-19 shut it all down. Today the pandemic has shut down the areas of the economy most foundational to yellow taxi service—tourism, business travel, commuting, Broadway and live events—and ridership is still down nearly 80%. And yet, right now, on

Commission regulation mandates that taxis must be replaced every seven years, regardless of whether a vehicle has passed all its inspections or even if it has not been on the road at all for months. As many as 4,500 taxis will need to be replaced within the next 12 months, requiring a massive investment by the industry in the order of $135 million. No owner-driver or fleet is in the financial position to purchase new taxis. Even if they were, banks—still reeling from losses in the medallion industry—are not providing financing for taxi vehicle purchases. Yet the TLC still requires the replacement of the vehicles unless owners are able to show a “hardship.” Think about that for a moment. Taxi owners, whose investment has plummeted to underwater status, whose ridership has been decimated by two successive crises and who have risked their health and safety to serve the riding public during the pandemic, are being asked to “prove” a hardship in order to obtain the privilege of simply extending the life of their taxicab—a vehicle that passes stringent inspections and which owners cannot afford to replace.

AS MANY AS 4,500 TAXIS WILL NEED TO BE REPLACED WITHIN THE NEXT 12 MONTHS top of the crushing debt, pandemic-related losses and pre-pandemic diminished market share, taxi owners and drivers are facing a new financial hurdle: a vehicle crisis. The average cost of a taxi is $30,000. An arbitrary, pre-pandemic, pre-Uber Taxi and Limousine

BLOOMBERG

Vehicle-replacement rules place further burden on hard-hit cab owners

Proof of hardship has a name— Covid-19—and it’s going to affect operations for many months, perhaps many years, to come.

Fallout The consequence of continuing a tone-deaf and inefficient case-bycase approach to hardships is already playing itself out. Some who can prove outstanding credit card debt and bank loans on the medallion are getting a four-month hardship extension, which they have to keep applying for again and again. Others, who might not have clearly

demonstrable debt on a medallion but nevertheless cannot afford a new vehicle because of decreased ridership or a lack of financing, are choosing to “store” their medallion. That means they are opting to take the vehicle off the road. For a variety of reasons, there are now thousands of taxicabs in storage—not available to the riding public. There is a simple solution to this problem, which is exclusively a yellow taxi problem, as livery vehicles and Ubers have no mandatory retirement age: Extend the mandatory retirement dates for all taxicabs until

the pandemic is over and the industry bounces back, provided they pass inspection. This is compassionate and sensible, and it would protect the safety of the riding public. Vehicle retirements are the next taxi crisis—but it’s one we can avoid if the TLC simply recognizes the pandemic as a hardship and gives owners some room to breathe and get back on their feet. ■ Ron Sherman is president of the Metropolitan Taxicab Board of Trade, the city’s largest yellow taxicab trade association.

OP-ED

BY PATRICK PIZZELLA

ore than 30 years ago, the U.S. Labor Department started down a well-intentioned path that has resulted in confusion about fiduciary responsibility for private pension plans with respect to proxy voting. Now, after considering nearly 7,000 comments, a final rule was issued that addressed how a fiduciary’s duties apply to proxy voting. In the 1980s, a wave of hostile takeovers swept through corporate America. In some cases, the raiders offered a significant premium to existing shareholders. In response,

would violate the fiduciary obligations imposed by the Employee Retirement Income Security Act, or ERISA. In 1988 the Labor Department issued a letter to the chairman of the retirement board for Avon Products. The letter stated the obvious— that when managing pension plan assets covered by ERISA, a fiduciary’s responsibilities extend to the voting of proxies associated with shares of corporate stock held by the plan. Accordingly, when exercising their right to vote proxies, fiduciaries must act prudently, solely in the interest of the plan’s participants and beneficiaries, and for the exclusive purpose of providing benefits to participants and beneficiaries. To act prudently in voting proxies, a fiduciary must consider those factors that would affect the value of the plan’s investments. Sadly, since the Avon letter, and despite subsequent Labor Department guidance to the contrary, some private pension plans and their investment managers have mistakenly believed that they have a green light to promote a myriad of

AFTER CONSIDERING NEARLY 7,000 COMMENTS, A FINAL RULE WAS ISSUED corporations adopted poison pills and other takeover defenses. It was not unheard of for a chief executive to ask fellow CEOs to instruct their pension plans to vote in support of takeover defenses, even if it might preclude a highly favorable acquisition offer to the detriment of those plans. Such acts

social and public policy preferences that have no quantifiable economic impact on securing the retirement future of American workers. Often, these efforts have occurred through overreliance on a small number of proxy advisory firms, which have been the subject of concerns regarding their own conflicts of interest, analysis that’s not sufficiently comprehensive nor tailored to the company being reviewed, and the firms’ potentially biased policy preferences. One reason for the widespread use of proxy advisory firm recommendations is the mistaken belief by many plan fiduciaries that ERISA requires them to vote every proxy and therefore have a basis for such vote.

BLOOMBERG

Department of Labor rule prioritizes goal of maximizing retirement benefits

PIZZELLA

Common sense The Labor Department has issued a final rule that affirms the common sense principles underlying proxy voting for private pension plans. Simply stated, when fiduciaries are deciding whether and how to vote proxies, they must carry out their duties prudently and solely in the interests of plan participants and beneficiaries. Importantly, this regulatory effort—for the first time ever with respect to proxy voting

under ERISA—was undertaken with the full participation of the public pursuant to the federal Administrative Procedure Act. The final rule expressly states that ERISA’s fiduciary obligations do not require the voting of every proxy. The final rule also provides safe harbors so that it’s clear to fiduciaries they need not vote proxies that are unlikely to impact the investment performance of the plan’s portfolio.

Like the Labor Department’s recently released rule specifying that fiduciaries must use only pecuniary factors in selecting investments, the rule on proxy voting appropriately refocuses the attention of fiduciaries solely on maximizing the benefits for—and future retirement security of—American workers. ■ Patrick Pizzella is the U.S. deputy secretary of labor.

JANUARY 11, 2021 | CRAIN’S NEW YORK BUSINESS | 5

ASKED & ANSWERED WHO HE IS Owner, Maddd Equities

INTERVIEW BY EDDIE SMALL

AGE 51

orge Madruga is the owner of Maddd Equities, a development firm with projects everywhere from Hudson Yards to the Upper East Side to the South Bronx. The company also has a major affordable-housing project underway in Inwood and was a strong supporter of the effort to pass the neighborhood’s rezoning and ensure it survived its court challenges. At a time when real estate development is subject to frequent community opposition, Madruga looks to balance local concerns while taking advantage of the urgency in the market. Are you happy that the Inwood rezoning was ultimately allowed to proceed? Were you surprised by the amount of pushback it got?

I am happy that it finally got approved and done. We got very close to certifying our rezoning for just our property, and then we joined together with the city, and it became a very big to-do in the community—rightfully so. In the beginning I didn’t really understand why the pushback was so strong because, in my mind, rezoning brings development, opportunity and jobs, but as I worked with the community, I understood their concern, which was not getting displaced.

What are your thoughts on the city’s push to rezone other neighborhoods like SoHo and Gowanus? I think rezonings are much harder to get done today

GREW UP Madruga emigrated from Cuba to Florida on the 1980 Mariel boatlift. RESIDES Port Washington, Long Island EDUCATION He went straight from high school to working at a small construction company. PROJECTS Madruga has developed about 5,000 residential units across the city and currently manages more than 1 million square feet of commercial space. Maddd has about 15 projects in the pipeline. FAMILY GUY He’s married with three daughters: One just graduated from law school, and the twins are still in college. GOOD EATS He’s a big fan of West Village steakhouse 4 Charles Prime Rib. FAST CAR Madruga’s hobbies include martial arts, dancing and driving his Porsche.

because there have been some bad apples, and the community sentiment now is “Don’t trust the developer. It doesn’t matter who he is or what he’s done. Just don’t trust the developer.” So

I don’t feel good about the other rezonings going on. I think it’s going to be very difficult to get to a meeting of the minds.

Has that type of community sentiment changed your approach to developing new projects?

It’s definitely made me more cautious. It used to be known that people wanted development. People wanted affordable housing built. Today the project needs more than that. There has to be a story. The community needs to be behind it before it starts, and there have got to be multiple community partners. And it will still be hard because there are still going to be people who will not like whatever it is we’re doing.

What is one of the biggest ways you’ve seen the pandemic affect local real estate?

Prices are coming down. I’m starting to get calls from people who are extremely urgent to sell. At the beginning of the year [2020], if I called these people, they’d be like, “Call me in five years. I’m not ready.” Today, they’re calling me: “OK, I’m ready to retire and go to Florida. Would you want to buy my property?” There’s definitely an urgency in the market among people trying to sell property, and I think it’s going to get worse.

What needs to happen for the city’s economy to turn around post-Covid?

We need to open the city back up, and we need tourists back in New York. They stay in our hotels, eat in our restaurants, and a lot of them shop in those small retail stores. I think the city will come back stronger, but it will go through a repricing first. It will be three years at least of rents staying low and then starting to grow little by little. The economy will come back through building but not at the same prices. ■

NOMINATIONS NOW OPEN

PIN#204842- DUE 1-25-21 AT 2:00 PM New York City Housing Authority (NYCHA) seeks proposals from qualified construction management firms pursuant to the award of approximately twenty (20) separate IDIQ contracts for Construction Management as Agent Services on various capital construction projects. CM Services will include Full Project Management Services for Large/Complex Projects and Small Projects, Staff Augmentation Services, and Technical Assistance to NYCHA. A non-mandatory virtual Proposers’ conference will be held on January 11, 2021 at 11:00AM. Conference slideshow will be available via iSupplier via the link below after January 11. Proposers may submit, via e-mail, written questions to NYCHA’s RFP Coordinator Yesenia Rosario RFP.Procurement@nycha.nyc.gov no later than on January 13, 2021, 2:00 p.m. Questions and responses will be posted on NYCHA’s on-line system iSupplier. A copy of the Request for Proposal PIN # 204842 may be obtained on NYCHA’s website through the following link: http://www1.nyc.gov/site/nycha/business/isupplier-vendorregistration.page. View video tutorial and/or select appropriate iSupplier log-in link (depending on whether you already have an iSupplier ID and password). Once you are logged in, select

Sourcing Supplier/Sourcing/Sourcing Homepage/and enter RFP Pin# in “search open negotiation box”. All submission requirements are contained in RFP PIN# 204842.

Bill de Blasio, Mayor, New York City

DEADLINE TO NOMINATE: JAN. 22 Crain's New York Business is seeking executives to be featured in our 2021 Notable Women on Wall Street—women who have impacted the New York City financial sector in major ways. The honorees selected will be featured in a celebratory section within the March 8th issue of Crain's New York Business which will honor their professional, civic and philanthropic achievements.

Gregory Russ, Chair & CEO, NYCHA

CRAINSNEWYORK.COM/NOMINATIONS 6 | CRAIN’S NEW YORK BUSINESS | JANUARY 11, 2021

BUCK ENNIS

JORGE MADRUGA Maddd Equities

DOSSIER

2021

ECONOMIC

FORECAST NYC yearns for a recovery With vaccines arriving, businesses ravaged by the pandemic are hoping to hang on until the economy rebounds BY AARON ELSTEIN

ISTOCK

ew York small-business owners were devastated last year, but none more so than those on Burnside Avenue in the Bronx. Looters ransacked the street’s retailers and pharmacies in June. The last bank in the neighborhood left in September. The question now is whether the latest round of government assistance will arrive fast enough to keep shops and restaurants alive over the winter. “Every business owner is scared and wondering how they’ll pay their Con Ed bill,” said Angel Caballero, executive director

of the BJT Bronx Merchant Association. Sixteen miles south on the 4 train, it’s a different world in Manhattan’s financial district. The stock market is at record highs and scorching demand for Airbnb’s listing on the New York Stock Exchange was yet another sign of how technology companies are deftly adapting to the new world. Add the prospect of Covid-19 vaccines becoming widely available and more fiscal support coming from Washington, and Wall Street is truly excited about 2021. “We are asking ourselves how good next year will be,

whereas in 2020 the question was how bad would it be,” said Ellen Zentner, chief U.S. economist at Morgan Stanley at a recent meeting of the Securities Industry and Financial Markets Association. A good year on Wall Street would certainly benefit New York as a whole, because although the securities industry accounts for less than 5% of local jobs it pays out 20% of all private-sector wages. But the city’s economic outlook for 2021 See ECONOMY on page 10 JANUARY 11, 2021 | CRAIN’S NEW YORK BUSINESS | 7

2021

ECONOMIC

FORECAST

COMMERCIAL REAL ESTATE

Commercial real estate will get worse before it gets better The decline of retail real estate has been expedited by the pandemic

s if things couldn’t get worse for commercial real estate in New York City, experts say the market won’t reach its bottom until the spring. But it isn’t all bad news. That’s also when the Covid-19 vaccine will be distributed more broadly and people will begin to feel more comfortable coming back to their offices, said Rudin Management CEO Bill Rudin. “That’s going to be the turning point,” he said. In the meantime, developers and landlords are trying to make sense of the current market. “What we’re dealing with right now is a lot of empty buildings,” said Nelson Mills, the CEO of real estate investment company Columbia Property Trust. The firm’s buildings are currently only 10% occupied, and tenants aren’t expected back until the summer, he said. Though leasing activity has been dismal, prices haven’t moved much, unlike the residential market. Commercial property owners are taking a “wait-and-see” approach to see just how much they’ll need to negotiate to get tenants into their buildings, partly because commercial leases tend to be for multi-year periods. They’ll come down eventually, Mills said, especially in older buildings that haven’t been renovated in a while. As more sublease space comes on the market, there will be more downward pressure

on prices, said Lori Albert, a director of research at Cushman & Wakefield. While asking rents may not have changed much, landlords are certainly offering more concessions to get tenants in which is pushing down net rents, she added. Low housing prices will also give offices a boost, said Tom Citron, an executive managing director at Colliers International. People who would normally have to commute will now be able to afford to live in the city and be closer to work, he said.

MILLS

Priced to sell Some properties won’t be able to avoid foreclosure, he added. During the second quarter of 2021, banks will start taking over and trading distressed real estate properties at prices that will be good for investors. “They’re going to do that at numbers that make sense, [at] prices where people can make transactions,” he said, “not the crazy inflated prices we’ve seen before.” Most of these properties will be hotels and mixed-use real estate that include retail or restaurant space.. Delinquency and special servicing rates for Manhattan retail already climbed to an all-time high of 16.78% and 17.55% in August, according to data from analytics firm Trepp. Hotels won’t see recovery until at least 2025, experts say. “We all know the sector that got hit the hardest is hospitality,” said Citron. That includes hotels, restaurants and

BUCK ENNIS

BY NATALIE SACHMECHI

entertainment. Still, the outlook isn’t as bad as it is for retail, according to the landlords. “I’d rather be in the hotel business than the retail business, but it’s tough to say,” said Marty Burger, the chief executive of Silverstein Properties. Brick-and-mortar retail was already dying before the pandemic, they said. The pandemic just expedited that process. Retailers are battling their landlords in court over missed rent, some owing millions.

Manhattan mall owners including Related Cos. have filed lawsuits against tenants at The Shops at Columbus Circle for more than $7 million in rent arrears. It’s difficult to say whether judges will find in favor of the landlords or the tenants given the current times, but with the damage done to the retail sector, retailers won’t be able to pay if they don’t have any money, said Trevor Adler, a real estate attorney at Stroock & Stroock & Lavan. ■

RESIDENTIAL REAL ESTATE

Cheap rents, lots of sales should define city’s residential market this year An exodus from the city during the pandemic continues to depress rental prices

ew Yorkers can expect lower rents and an extremely busy year for home sales in 2021 as the city’s real estate industry looks to slowly emerge from the continuing effects of the pandemic. Rents in the city have been falling for months, and experts predicted that this trend would continue for at least the first half of this year. It is unlikely to reverse until the rate of renters returning to the city outpaces the rate of apartments hitting the market, and the rate of renters returning is unlikely to hit pre-pan-

one sign of recovery, as cheaper Manhattan apartments led to the first month-overmonth decrease in vacancies–from October to November–since the onset of the pandemic, according to the latest Douglas Elliman rental report. This, however, does not mean a return to sky-high demand and prices for apartments is coming soon.

Road to recovery “So much of this depends on how quickly or at what point do companies bring their employees back, and what percentage of those employees are actually coming back and not working remotely,” said Jonathan Miller, CEO of the appraisal firm Miller Samuel and author of the Elliman reports. “Which–read between the lines– we’re not expecting a full contingent to come back.” The sales market should face a smoother road to recovery than the rental market, especially given how brisk home sales were in the fall. New Yorkers who have been able to weather the pandemic financially so far will try to take advantage of this year's unusual market and buy homes that might otherwise be out of their price range, according to the StreetEasy report, which notes that a record high 74% of homes sold below their initial asking

“SO MUCH DEPENDS ON HOW QUICKLY COMPANIES BRING THEIR EMPLOYEES BACK” demic levels until the city’s job numbers reach pre-pandemic levels, which could be a slow process, according to a report from StreetEasy. “Re-creating more than half a million jobs could take considerably longer than successfully rolling out a vaccine,” the report noted. The city’s rental market has already shown 8 | CRAIN’S NEW YORK BUSINESS | JANUARY 11, 2021

MILLER BUCK ENNIS

BY EDDIE SMALL

price in 2020. “We expect it’s going to be one of the busiest years of home shopping . . . because we’ve already seen record high pending sales in the fall, especially in Brooklyn,” said StreetEasy economist Nancy Wu. Hal Gavzie, executive manager of leasing at

Douglas Elliman, sounded a similarly optimistic note about Manhattan sales. “Now is a great time to take advantage of an investment in Manhattan,” he said. “It’s nice to see the numbers have definitely increased and continue to increase month after month on the sales front.” ■

ECONOMIC

FORECAST

2021

TECHNOLOGY

Small biz, antitrust and WFH: Tech trends to watch in 2021

Mom-and-pops hope consumer dependence on e-commerce helps them stay afloat

ew Yorkers spent a vast majority of their life online in 2020 and will likely continue to do so for much of 2021. That’s good news for tech giants like Amazon, Facebook, Apple and Google. But how can New York’s mom-and-pops get in on the action this year? A growing retail experiment in Brooklyn may show the way. Cinch Market has enrolled more than 50 shops into its ShopIn.NYC marketplace, an attempt at building an Amazon-type distri-

“THERE IS THIS NEED TO CREATE A BROOKLYN MALL ONLINE” bution network for the borough’s small businesses. The market, which is expanding to Manhattan, offers same-day delivery of more than 50,000 items, including books, toys and groceries. It’s still in its early days, but the network may show how small businesses can band together to embrace e-commerce. “People want to shop local, but they also want variety, and they want to shop at 10 p.m. on their couch watching Game of Thrones,” said Anthony Fauci, owner of the

Runnin’ Wild toy store in Carrol Gardens, a ShopIn.NYC member. “There is this need to create a Brooklyn mall online.”

Playing monopoly The proliferation of online services will be the trend to watch this year. New York’s small businesses had, for better or worse, been dependent last year on delivering food, hosting Zoom workouts and shipping toys. In a post-vaccine world, how does technology interact with the hopeful return of in-person shopping and dining? Software companies will be lining up a host of solutions. Ghost kitchens, contactless payments and digital menus have grown quickly and may be here to stay, said Joel Montaniel, CEO of SevenRooms, a Flatiron District hospitality software startup. “But people will be seeking the human touch and personalized experiences,” Montaniel said. “So where does technology help, and where does it get in the way?” The digital shift of 2020 also accelerated the accumulation of power and wealth among a few chosen companies. That sets up another trend to watch in the coming year: antitrust. New York Attorney General Letitia James is leading multistate lawsuits against Google and Facebook. A bill in the state Legislature backed by Sen. Michael Gianaris would

ANTHONY AND STACEY FAUCI of Runnin’ Wild, a ShopIn.NYC member

BUCK ENNIS

BY RYAN DEFFENBAUGH

open up state courts for more lawsuits against monopolistic tech giants.

Remote life Keep an eye, too, on technology’s role in the real estate market. Tech firms leased more New York office space than any industry in 2019. But many of those firms are now

embracing remote work. As more of the city springs to life, “that FOMO—fear of missing out—will return, and they will want to be here,” said Maria Gotsch, who leads the investment fund of the Partnership for New York City. Office landlords will have to wait and see. ■

HOSPITALITY

Hard-hit hotels, restaurants and theaters expect slow recovery, even with federal funds Pandemic restrictions devastated the hospitality sector, and the way back is still not in sight

ocial distancing, empty streets, darkened stages and shuttered lobbies highlight the devastation brought upon New York’s hospitality industry. Those within the sector argue a combination of federal aid and overhauled regulations are what’s needed to spark a post-Covid-19 turnaround. Restaurateurs such as Jeffrey Bank, CEO of Alicart Restaurant Group, said he cannot understand why the Republican U.S. Senate won’t pass a relief package for the industry, especially after the way restaurants adapted and served a locked-down nation. “The Restaurant Act needs to be passed,” he said, referring to the $120 billion bill put forward by the Democratic House of Representatives. “What other industry was shut down for months but was then asked to stay open to support everyone and hasn’t been given any support?” The $900 billion Covid-19 rescue package passed by Congress on Dec. 27 did not include an amendment for the $125 billion Restaurants Act. Industry advocates hope the incoming Biden administration will make it a priority this year. But Bank, with decades of experience in the industry, said the extended period of financial strain would close more restaurants

in 2021. The only ones surviving will do so through the good graces of their landlord, he said. “Our industry’s in dire despair,” Bank said.

‘It may take awhile’ Unlike restaurants, which have been able to continue business at limited capacity, Broadway has been dark for months, with the Stage Directors and Choreographers Society estimating unemployment at 98%. The Broadway League recently suspended all ticket sales through May. “We’re not expecting anything until the second half of the year,” said Randy Anderson, a senior staff member at the state directors’ union. It’s not clear how the $1.8 billion performing arts industry will recover without some form of federal assistance. A new carve-out in the recent Covid-19 rescue package allocates up to $15 billion for theaters, music halls and other cultural venues to tap into through federal grants and reimbursements. Rehearsals are still a long way down the line, experts note, to say nothing of packed houses. A staggered reopening in the next two years is most likely. “All 41 Broadway theaters will be filled eventually,” Anderson said. “They’ll come back, but it may take awhile.”

BUCK ENNIS

BY BRIAN PASCUS

DANDAPANI

Then there are the problems facing hotels. A recent survey by the Hotel Association of New York City found that only half of the 102 hotel operators questioned say their industry will recover. More than 200 hotels have closed either temporarily or permanently during the pandemic; others have been turned into homeless shelters. Vijay Dandapani, CEO of the Hotel Association of New York City, doesn’t expect business travel to resume until the summer or for conventions to begin until 2022.

Meanwhile, he expects revenues will continue to crater under low occupancy. Making matters worse is an archaic city property-tax law whose rates on hotels are assessed based on previous year values. Dandapani argues the tax must be amended this year. “The single biggest assist from the city can and must be real estate tax relief in the form of an assessment that reflects the nearly 90% drop in revenue over the last nine months,” he said. ■

JANUARY 11, 2021 | CRAIN’S NEW YORK BUSINESS | 9

2021

ECONOMIC

FORECAST

HEALTH CARE

Vaccine gives hope to health care industry, but challenges from Covid-19 persist Insurance carriers worry about costs from delayed treatments and Medicaid changes

ot even doctors and nurses well versed in public health emergencies could have imagined when they first heard reports of a mystery respiratory illness in late 2019 that the health care system would still be reeling from it at the beginning of 2021. However, throughout the battle against Covid-19, there’s been a glimmer of hope. This year vaccines from Pfizer, Moderna and other drugmakers are slated to help hospitals and other health care providers protect their workers and the communities they serve. For the industry, inoculations are expected to bolster efforts to bring more regular and preventive services—critical to patient health and facilities’ financial stability—back online. Despite receiving billions of dollars in federal relief, health systems have continued to hemorrhage hundreds of millions of dollars in revenue with each passing month, thanks to patient reluctance to schedule visits and delayed procedures. Though hospitals have been preparing for distribution for months, once the Food and Drug Administration granted emergency-use authorization to the first vaccine in the U.S.,

“ROUTINE AND PREVENTIVE CARE IS AN ABSOLUTE REQUIREMENT” from Pfizer, in early December, a new urgency and outlook emerged. The first doses were earmarked for frontline and hospital workers. “Those were probably the longest two weeks of my life, waiting for the vaccine to come,” said Dr. Donald Morrish, chief medical officer at St. John’s Episcopal Hospital in Far Rockaway. With the help of the vaccine, Morrish expects, St. John’s will be able to put more resources behind growing its primary and specialty care footprint on the peninsula later

this year rather than beating back a pandemic. That's especially important for the population that St. John’s serves, which—like many communities in the outer boroughs—has been disproportionately affected by the crisis. Rebuilding access to services will be critical to chipping away at longstanding health disparities brought to even greater light during the Covid era.

Insurance and telemedicine It’s not just doctors and hospitals that are anxiously awaiting a turnaround. “Covid is going to continue to be a major challenge for everybody in the delivery system and health plans,” said Eric Linzer, president and CEO of the New York Health Plan Association, which represents 28 managed-care health insurers that provide services to more than 8 million New Yorkers. The state had convened a team tasked with achieving billions of dollars in Medicaid savings to help address a deficit even before the pandemic. Insurance plans across the state will be keeping an eye on state budget cuts and what they mean for some of the most vulnerable New Yorkers, who rely on Medicaid for health coverage, Linzer said. “Continued cuts to health plan rates are not going to be sustainable,” he added. In a rare move, hospitals, health centers, patient advocacy groups and insurance plans have all convened in opposition to the state’s proposed changes to the Medicaid pharmacy benefit, Linzer noted. The proposal would affect a drug discount program that allows safety-net providers, including community health centers and hospitals, to purchase deeply discounted drugs and use the savings to provide essential services for low-income New Yorkers. Although the state holds that its proposal will save taxpayers millions of dollars by ensuring that Medicaid pays the best price for medications, many say it will end up costing the state in the long run. Patients will end up sicker because they haven’t received needed care and services supported through the pro-

MORRISH BUCK ENNIS

BY JENNIFER HENDERSON

ECONOMY hinges on whether any of that prosperity reaches places like Burnside Avenue. In 2013, Mayor Bill de Blasio campaigned on how New York had become “a tale of two cities” that catered to the elite rather than the needs of everyday people, and one of his administration’s signature achievements was furthering a trend that started in the Bloomberg years: Weaning the city off its historic reliance on Wall Street and expanding economic opportunity beyond Manhattan. Between 2010 and 2017 employment in Brooklyn grew by 40%—the second-best of any county in the nation—and Queens, the Bronx and Staten Island weren’t far behind. Then came the pandemic. In the months after the economy locked down, Queens lost 21% of its jobs, Moody’s Analytics economist Barbara Denham said, which may reflect its unfortunate status as an early coronavirus hotspot. But the numbers were god-awful everywhere. More than 200,000 leisure and hospitality jobs in Manhattan, a key source 10 | CRAIN’S NEW YORK BUSINESS | JANUARY 11, 2021

CABALLERO

of unionized employment for immigrants, were wiped out. About 50,000 jobs have vanished in retail where the average wage is $46,600. White-collar workers suffered much less. The securities industry shed an estimated 7,300 jobs last year, according to the state comptroller’s office, about a 5% decline that was milder than the 2002 or 2009 recessions. That could change if NYSE member-firm revenues decline to $205 billion next year from

BUCK ENNIS

FROM PAGE 7

gram, they argue. Insurance plans also are keenly aware of the possibility of sicker patients requiring more costly care this year as their ailments worsen due to treatment that was delayed during the height of the pandemic. It’s a concern for physicians as well. “We firmly believe that routine and preventive care is an absolute requirement for reducing the overall cost of health care,” said Dr. Ian Leber, chief medical officer of sprawling physician group ProHealth. “Unfortunately, these types of visits are the ones patients are most willing to forgo during this pandemic.”

Adapting to virtual services has helped; telemedicine will continue to be an area of focus this year industrywide. “Through the use of patient-friendly technologies, we have seen an astounding rate of acceptance by even the least tech-savvy of our patients and have performed up to 15,000 virtual visits per week,” Leber said. All in all, the vaccine is essential to the overall economic recovery. Dr. Teddy Lee, chairman of emergency medicine at St. John’s, adds that the public at large must be willing to take it. “People need to believe the science,” Lee said. ■

2019’s $250 billion, as the Independent Budget Office projects. Yet everything New York needs to rebound is here. “The question of the recovery is not if, it is when,” said Moody’s Denham, who has tracked the local economy for more than 25 years. If the majority of the population receives the Covid vaccine by June, demand for travel, entertainment and dinner reservations could be huge, although hotels may remain empty because the first wave of visitors probably won’t come from far away. “I think many will substitute a trip to New York via car or train over a flight to the Caribbean,” Denham said. Many residents will be eager to return to the city, especially young people who waited out the pandemic at their parents’ homes. Lower rents will make the return more affordable. And while some businesses may decide it’s time to leave New York—Deutsche Bank is reportedly thinking of relocating half its staff— Facebook, Amazon, Google, Apple and Netflix have all chosen to expand here.

The biggest threat to a recovery is the huge budget deficits faced by the city and state. Federal aid is unlikely to fill the gap any time soon. With Democrats winning a veto-proof majority in the state Senate, some on Wall Street are betting the Legislature will approve a surcharge on incomes over $5 million and adopt funding policies that are more favorable to the city, said Matt Fabian, partner at Municipal Market Analytics. Translation: Materially higher taxes for the state's wealthiest residents, many of whom live in Manhattan and nearby suburbs.

Waiting for the cavalry Meanwhile, small business owners across the city are trying to hang on until the cavalry comes. On Burnside Avenue there is a hopeful sign on the horizon: The local Chase branch that shut in 2019 is scheduled to reopen in the spring. That would give the district a bank to serve its more than 200 momand-pop businesses and represent a tangible sign of recovery. “Don’t write us off,” Caballero pleads. “We have something to offer.” ■

COMMERCIAL REAL ESTATE

Developer plows ahead with plans for $3.5 billion Bronx megaproject BY EDDIE SMALL

Fordham Road for about $31.6 million. Galway Realty was the seller of its latest site. Representatives for Galway could not be reached for comment.

he real estate firm working on one of the most ambitious projects in recent Bronx history has purchased another parcel of land for it, according to the development team. Brad Zackson and his representatives said Dynamic Star, led by Zackson and Gary Segal, bought the site of a concrete plant along the Major Deegan Expressway for $21 million. It is part of Dynamic Star’s Fordham Landing project, a $3.5 billion development slated to run along the Harlem River waterfront in the University Heights section of the Bronx.

The Dynamic Star team has touted Fordham Landing as a development that will provide 17,000 jobs and likely be the biggest project the city has seen since Hudson Yards. Dynamic Star plans to develop it on a 30-acre site that will include 2,380 housing units, to be split up as 720 affordable units and 1,660 market-rate ones. The project will include 50,000 square feet of retail space, an 800,000-square-foot life sciences center, a roughly 300room hotel, waterfront bars and restaurants, an e-sports center and a 1.2-mile esplanade. The developers hope to reach a final agreement with the city on a proposed conceptual design for the project during the first half of the year and get their land-use application approved in April 2023.

“WE’RE ADDRESSING A MIDDLE MARKET THAT COULD USE SOME HELP” The company has previously purchased parcels for Fordham Landing, including 2371 Exterior St. for $12 million and a site along West

MERIDIAN CAPITAL GROUP

Job creator

The pandemic pushed the project’s timeline back by about a year, but the team is still excited to move forward with it, Zackson said. “I think we have a more cohesive team at the moment to get this project done,” he said. “Our project is not in the high-end market. We’re addressing a middle market that

could use some help in the Bronx, specifically.”

Other BX projects Brookfield is also at work on a major project in the Bronx. The company is planning a $950 million development in Mott Haven called Bankside that would bring 1,350

apartments to 4 acres along the Harlem River. Other projects recently planned for the Bronx include a 121-unit residential development in Highbridge from prolific developer Mark Stagg and a 42-unit residential project from Atlantis Development in Wakefield. ■

RESIDENTIAL REAL ESTATE

Related scoops up affordable apartments on Lower East Side for $424M BY NATALIE SACHMECHI

265–275 CHERRY ST.

elated Fund Management, the capital-management arm of The Related Cos., has closed on two Section 8 apartment buildings on the Lower East Side from CIM Group for $424 million, sources familiar with the deal say. The 26-story towers at 265–275 Cherry St. contain 490 units of affordable housing across more than 450,000 square feet in the Two Bridges neighborhood. CIM and its joint venture partner on the property, L&M Development, also own land at 260 Cherry St., where they plan to develop more apartments. It was not part of the sale.

Affordable pledge

Redefining what you should expect from your accountant. grassicpas.com

CIM challenges

Related, the megadeveloper behind Hudson Yards, secured $281 million in financing to complete the deal, which is reported to be the largest multifamily trade in Manhattan since the pandemic. The buildings went into contract for $435 million late last year, according to reports, but closed for about $11 million less. Los Angeles–based CIM Group partnered with L&M in 2013 to purchase the buildings for about $280 million, according to property re-

ment. The firm, led by Stephen Ross, continues to be one of the largest developers of affordable housing in the country. The buildings sold to Ross’ company were built in 1979 and include one-, twoand three-bedroom units. Amenities include an onsite community room, a convenience store and outdoor courtyards with playgrounds. A Cushman & Wakefield team led by Adam Spies and Doug Harmon brokered the transaction, and Gideon Gil and Lauren Kaufman secured the financing for the deal.

cords. The partners pledged to preserve the apartments as affordable housing for the next 40 years in an agreement with the federal government to provide rent subsidies to tenants. Related, which got its start developing affordable apartments in the early 1970s, will honor the agree-

CIM has been embroiled in a series of lawsuits over several of HFZ Capital’s condo buildings, where HFZ is delinquent on nearly $90 million in loans from CIM. The lender has been trying to foreclose on the properties while facing pushback from HFZ, which claims a foreclosure sale is unreasonable. A sale has been halted by a judge for the time being. ■ JANUARY 11, 2021 | CRAIN’S NEW YORK BUSINESS | 11

SPONSORED CONTENT

LESSONS LEARNED: NAVIGATING FINANCIAL ASSISTANCE IN A CRISIS Cash flow concerns took center stage for many companies during the pandemic More than half the businesses in New York City received some type of financial assistance during the coronavirus crisis, according to a recent survey of financial executives by Crain’s Content Studio.

companies faced during the pandemic. Many companies continue to monitor that situation carefully, with 20% conserving cash and minimizing risk in preparation for a post-pandemic recovery.

The bulk of that aid came from the federal government in the form of Paycheck Protection Program loans introduced as part of the Coronavirus Aid, Relief and Economic Security Act. During a recent discussion sponsored by of firms took advantage of PPP Crain’s and Baker Tilly, a panel of financial loans during the executives discussed the pandemic lessons organizations and government agencies could draw from their intense focus on cash preservation during the height of the crisis.

The speed and severity of the economic crisis at the beginning of the pandemic left many companies flat-footed. For those companies, financial assistance programs such as the PPP became a lifeline.

37.5%

THE EFFECTIVENESS OF PPP LOANS VARIED Nearly a quarter of financial executives surveyed listed cash flow among the top three challenges their

“We helped a lot of clients with the whole PPP program out of the gate,” said Christine Fenske, managing partner at Baker Tilly. “For the ones that really needed [the funding], it was super helpful. And then there were others that took it because it was there.” Of greater concern, however, are businesses that potentially could have used the funds but refused to take them, she said. “They said they were worried about the rules changing in the middle of the game,” Fenske said. Others were worried about negative public relations,

she explained, because the loans were administered through the Small Business Administration and, therefore, matters of public record. GETTING FUNDING IN THE RIGHT HANDS AT THE RIGHT TIME REMAINS CRITICAL

friendly for the folks who need it the most.” FOCUS ON CASH FLOW CAN MAKE BUSINESSES MORE RESILIENT IN GOOD TIMES AND BAD

As the pandemic has worn on, and now that the PPP money is running out, Fenske sees a need for additional action.

Companies have had to build flexibility into their plans to cope with cash flow issues. Ultimately, that process may make them more resilient in the future—and less likely to need assistance.

“We need something to help those [organizations] through,” she said. “I do believe we’ll get some sort of answer that is going to help some of these individuals that truly need it, so they’ll be able to hang on.”

“One of the things that’s shifted is making sure you have the ability to really focus on cash,” said Christopher Macies, finance director at Sidewalk Labs.

Dana Price, chief financial officer of Kenzie Academy, said her company benefited from PPP loans—and would have borrowed more money if it had been available. She would like to see more effort go into prioritizing the organizations that receive funding.

Companies must understand whether customers will continue to be able to pay, Macies said, adding they should maintain flexibility and visibility through both the sales pipeline and collections to ensure they know exactly how they will be able to pay their bill.

“I would love to figure out how to take a program that’s run by the government,” she said, “and perhaps modernize it in a way that might be more corporate-

“Make sure you’ve got the optionality or at least understand what levers to pull to reduce some of that uncertainty and stress,” he said.

“I WOULD LOVE TO FIGURE OUT HOW TO TAKE A PROGRAM THAT’S RUN BY THE GOVERNMENT AND PERHAPS MODERNIZE IT IN A WAY THAT MIGHT BE MORE CORPORATE-FRIENDLY FOR THE FOLKS WHO NEED IT THE MOST.” — Dana Price

Join Us In 2021

THE LIST TOP PROPERTY SALES Largest commercial transactions in New York City through the second half of 2020, ranked by price

PRICE (MILLIONS)

SQ. FT. OR NO. OF UNITS PRICE PER SQ. FT. OR UNIT

INTEREST CONVEYED

100% VALUE (MILLIONS)

BIG FOUR CLOSE DATE

BUYER(S)

SELLER(S)

1 2

410 10th Ave.

$905

546,929 $1,742

95%

$953

12/18/2020

601W Cos.

SL Green Realty Corp./ Kaufman Organization joint venture

1375 Broadway

$435

513,000 $848

100%

$435

7/10/2020

Savanna Investment Management LLC/ Declaration Partners joint venture

Westbrook Partners

3 4 5 6

522 Fifth Ave.

$350

595,430 $588

100%

$350

8/27/2020

RFR Realty

Morgan Stanley

1 Union Square S.

$211

240 $880,729

100%

$211

11/16/2020

MKF Realty

Related Cos.

20 E. 76th St. (Surrey Hotel)

$150

190 $790,263

100%

$150

12/3/2020

Reuben Brothers

Kaufman Organization

140 W. 28th St. (TownePlace Suites/ SpringHill Suites)

$147

531 $277,520

100%

$147

9/30/2020

Phoenix Hospitality Group

McSam Hotel Group/ Barone Management joint venture

7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

60 W. 37th St. (Embassy Suites)

$115

310 $371,386

100%

$115

8/19/2020

Magna Hospitality Group

Ashford Hospitality Trust

15 W. 47th St.

$110

133,139 $826

100%

$110

12/10/2020

Jack Elo

Isaac and Eli Chetrit/ Scion Group joint venture

1 Christopher St.

$95

125 $760,000

100%

$95

12/18/2020

Carmine Ltd.

Jimmy Silber; Silber family

590 Fifth Ave.

$85

95,000 $890

100%

$85

10/26/2020

SL Green Realty Corp.

Thor Equities

902 Drew St. (Spring Creek Gardens)

$79

581 $135,972

100%

$79

7/30/2020

K&R Preservation

Arker Cos./The Domain Cos. joint venture

27-11 49th Ave.

$75

214,820 $349

100%

$75

8/31/2020

Traub Capital

Mana Products

Office Chelsea

Office Garment District

Office Midtown

Apartment Union Square

Hotel Upper East Side

Hotel Chelsea

Hotel Midtown Office Midtown

Apartment West Village Office Midtown

Apartment Lindenwood

Industrial Long Island City

$73

137 $536,325

100%

$73

11/20/2020

Vanbarton Group

Prodigy Network joint venture

350 St. Ann’s Ave. (Thessalonica Court)

$64

191 $335,079

100%

$64

12/28/2020

Jonathan Rose Cos.

Omni New York

14 53rd St. (The Whale Building)

$63

500,000 $168

75%

$84

9/25/2020

Nightingale Properties

Madison Realty Capital

400 E. 58th St. (Stonehenge 58)1

$62

126 $492,063

100%

$62

9/9/2020

A&E Real Estate

SL Green Realty Corp. joint venture

85 Fifth Ave.

$59

12,946 $4,560

100%

$59

10/30/2020

SL Green Realty Corp.

Brookfield Properties/ Wharton Properties joint venture

48-00 Grand Ave.

$51

223,000 $229

100%

$51

11/13/2020

Prologis

Family Stations Inc.

841 Madison Ave. (Prada)

$46

18,877 $2,415

100%

$46

10/16/2020

Safra family

Ashkenazy Acquisition

111 Kent Ave.

$45

62 $731,290

100%

$45

8/14/2020

Yihai Group

American Realty Advisors

837 Madison Ave.

$45

34,000 $1,324

100%

$45

11/6/2020

Akris

Myles Lowell

980 E. 149th St.2

$43

618,552 $280

25%

$173

8/31/2020

Dune Real Estate Partners LP

Turnbridge Equities joint venture

44 W. 44th St. (Royalton Hotel)

$41

168 $243,095

100%

$41

9/4/2020

MCR Development

Rockpoint Group/ Highgate Holdings joint venture

24-02 Queens Plaza S. (Apex Technical School)

$40

73,000 $548

100%

$40

9/14/2020

Carlyle Group/Botanic Properties joint venture

Atlas Capital Group

164 Fifth Ave. (Alo Yoga)

$40

16,280 $2,457

100%

$40

12/4/2020

Alduwaliya Asset Management

Thor Equities

Apartment Mott Haven Office Sunset Park

Apartment Sutton Place

Retail Union Square Development site Maspeth Retail Lenox Hill

Apartment Williamsburg Retail Lenox Hill

Development site Port Morris Hotel Midtown

Industrial Long Island City Retail Flatiron District

SOURCE: Real Capital Analytics with additional research by Chuck Soder. The list excludes portfolio sales and sales for which no price was made public. Partial-interest transactions are included at the prorated share of the 100% property value. Square footage for development sites consists of the square footage of the acquired land. Real Capital Analytics, headquartered in New York City, is an independent data and analytics firm focused on the investment market for commercial real estate. RCA offers data on commercial property transactions around the world. 1-Data is from media reports. 2-Dune acquired a minority stake, but the percentage was undisclosed; the price is based on an estimated 25% stake.

16 | CRAIN’S NEW YORK BUSINESS | JANUARY 11, 2021

TRANSACTION PRICE $905 million PRICE PER SQ. FT. $1,742

#2 1375 Broadway

84 William St. (AKA Wall Street) Hotel Financial District

#1 410 10th Ave.

TRANSACTION PRICE $435 million PRICE PER SQ. FT. $848

#3 522 Fifth Ave. TRANSACTION PRICE $350 million PRICE PER SQ. FT. $588

PHOTOS: COSTAR, BUCK ENNIS

ADDRESS PROPERTY TYPE NEIGHBORHOOD

#4 1 Union Square S. TRANSACTION PRICE $211 million PRICE PER UNIT $880,729

WHO OWNS THE BLOCK

99 MORNINGSIDE AVE.

HOPING FOR A HIT IN HARLEM Buyers are snapping up apartments in the neighborhood BY C. J. HUGHES 117 MORNINGSIDE AVE. Gas stations once dotted Harlem, but as in other parts of New York, developers have gobbled up many of them. A gas station at West 110th Street and Frederick Douglass Boulevard, for example, is now Circa Central Park, a semicircular 38-unit condo from Artimus Construction that has new units available almost five years after sales began. But this site, a tiny triangle, seems unable to support much more than the diminutive Shell gas station on it today. City tax records indicate Shell has had a presence there since 1960.

133 MORNINGSIDE AVE. This angular eight-story, brick-and-glass office building, jointly developed by hotel owners and hotel unions, opened in 2003 on a long-empty lot. For years it offered a range of health care services to hotel workers. But the collapse of the hotel industry, fueled by the pandemic, has hit Harlem Health Center hard. It will close at the end of the month, according to state Department of Labor filings.

99 MORNINGSIDE AVE. 11 HANCOCK PLACE

Among the buildings razed to develop this new 23unit condo, which also is called 375 W. 123rd St., was St. Luke Baptist Church, whose congregation had been based there since 1953. Mirroring a pattern that has played out across Harlem in the past decade, Azimuth bought the church’s red-brick building for $5 million in 2015 and agreed to construct a sanctuary on-site for the parish. But after Azimuth missed its 2017 completion deadline, the church sued, claiming the developer “made its fortune by targeting low-income neighborhoods for gentrification” and “has now used its expertise to take advantage of a church.” Both sides have since resolved their legal battle, for undisclosed terms, said Guido Subotovsky, Azimuth’s president. “Our relationship remains fruitful,” he added. Church officials could not be reached for comment. The church is due to return to the site this month from a temporary home nearby.

Another church-razing condo is this glassy 12-story, 71-unit offering, which replaced LaGree Baptist Church, a house of worship that was a former movie theater. LaGree sold the site to Nortco Development, a Manhattan builder, for $29 million in 2016. Since launching marketing in the summer of 2019, 11 Hancock Place has sold about 45% of its studio to four-bedroom units, half of which have outdoor space, a project spokesman said. Prices average $1,400 per square foot, StreetEasy.com reports. Moveins are “imminent,” the spokesman added, with buyers including professors at nearby Columbia University.

98 MORNINGSIDE AVE. Thor Equities, a developer perhaps best known for splashy retail condos on Fifth Avenue and in SoHo, owns this seven-story, 49-unit prewar apartment house, which it bought from Baruch Singer, a once-major local landlord, for $22 million in 2015. Since then, Thor Equities has gut renovated at least a half-dozen units in the elevator building, according to Building Department records. One of them, No. 57, a three-bedroom, two-bath apartment with park views, was leased during the fall, according to StreetEasy.com. The apartment’s last listed rent was $4,700 a month.

MORNINGSIDE PARK This craggy 13-block, 30-acre swath, designed by Olmsted and Vaux, the tag team behind Central Park, struggled with crime in the 1970s and 1980s before it underwent several renovations and became a popular attraction for residents of Harlem and adjacent Morningside Heights. Among the flora is a sequoia tree from Oregon that park workers planted in 2009. In 2019 an 18-year-old female student at nearby Barnard College was fatally stabbed in the park, reviving concerns about the area’s safety. 88 MORNINGSIDE AVE. This silver-toned 12-story, 74-unit building is a condop developed in 2011 by a team that includes the Bluestone Organization, a Queens-based firm. This building also has a church to thank for its existence. In this case it’s the Church of the Master, a low-slung brick building with a corner bell tower, that once stood on the site and still controls the ground lease. The church, which opened as Morningside Presbyterian Church in 1893, got a new home out of the deal, a gleaming white structure next door. The condo, meanwhile, offers one- to three-bedroom units, a roof deck and a bike room. A two-bedroom, two-bath apartment, put on the market in September, was listed for $1.2 million in early December. This is the time for people to take advantage of reduced pricing, said Susan Molloy, a Compass agent who sells in the condo.

BUCK ENNIS, GOOGLE MAPS

ogged by months of restrictions on showings and sluggish overall interest, 2020 has hardly been a banner year for condo sales, especially in Manhattan. But a few game developers are pushing forward. Among the latest is Azimuth Development Group, which has started sales at 99 Morningside, a 23-unit condo at West 123rd Street in Harlem. Early signs point to early success: Buyers have snapped up a handful of units in the last two months. But the neighborhood, which typically lures buyers priced out of fancier neighborhoods, now may prove less appealing as those upscale areas suddenly become cheaper. “If there is an opportunity to look at neighborhoods that were once out of reach, and now are not because of price drops, then you will consider it,” said Susan Molloy, a Compass agent. In November, after a few slow months, she decided to delist a one-bedroom condo at 88 Morningside that had been at $875,000. But some who considered Harlem too expensive might be drawn in now, Molloy added: “It should all come full circle.” The one- to four-bedroom units offered at 99 Morningside feature quartz kitchen counters, brushed oak floors and a part-time doorman. Eight of 23 apartments at the building, which has an angular stepped-back look, have terraces. The condo also features a perk that not many recent luxury condos can claim: sharply abated property taxes that phase in slowly over 15 years. The building broke ground before 2016, when the 421a state property-tax abatement expired. But a similar sweetener replaced it a year later. “There is no question whatsoever that tax break will help us,” said Guido Subotovsky, Azimuth’s president. Four units have gone into contract since sales began in November, within 5% of asking prices, he added. One-bedrooms start at $770,000, and they average $1,300 per square foot. But new condo sales have plummeted in Harlem, which roughly runs from Central Park to 155th Street. Between January and November 2019, 185 units sold. For that same period this year, 92 sold, according to figures from Brown Harris Stevens Development Marketing. But the average price per square foot has hovered around $1,300. For its part, Azimuth is taking a much narrower view, saying 99 Morningside’s competition is in the band south of 125th Street that some brokers call South Harlem. It includes condos such as 300 W. 122nd St., a 170-unit offering from Happy Living Development that also began marketing since the pandemic struck. “We feel extremely confident,” Subotovsky said. ■

JANUARY 11, 2021 | CRAIN’S NEW YORK BUSINESS | 17

SCHUMER

fund MTA capital improvements—is now expected to be pushed across the finish line by a Biden Department of Transportation. “The expectation for transit right now is extremely high and deservedly so,” Pearlstein said. “We’ll be looking at the federal government to be a partner to deliver for the MTA.”

FROM PAGE 3

Build it One place Schumer will immediately look to make an impact across party lines is transportation and infrastructure, two areas where the president-elect, “Amtrak Joe” Biden, has always shown an interest during his multidecade political career.

Power play

SCHUMER BLOOMBERG

Vice President–elect Kamala Harris holding the tie-breaking vote. Any major legislation will need Schumer to cobble together support from moderates on both sides, such as Sens. Mitt Romney, R-Utah; Joe Manchin, D-W.Va.; Susan Collins, R-Maine; Angus King, I-Maine; and Lisa Murkowski, R-Alaska. Any of those senators could tank or turn the tide of proposed Democratic legislation. “Even though the Republicans have lost a lot of their moral authority over everything, it’s still a closely divided Congress,” said Nicole Gelinas, a senior fellow at the Manhattan Institute. “There is no mandate for a left-wing, AOC-style rescue of city and state governments.”

Schumer has made it clear he intends to fund Gateway if given the opportunity. More broadly speaking, Schumer will be expected to continue his advocacy on behalf of the Metropolitan Transportation Authority. The beleaguered agency is facing the worst crisis in its history following the collapse of revenue and ridership during the Covid-19 pandemic, but Schumer worked hard in 2020 to secure more than $8 billion in federal assistance to keep the agency operating. Even Cuomo’s plan for congestion pricing—which is expected to

Schumer has previously championed projects including the Second Avenue subway and Amtrak’s Gateway project. Funding for Gateway— an $11.6 billion expansion and rehabilitation of subway tunnels between New York and New Jersey— has been held up for the past two years by the refusal of President Donald Trump’s Department of Transportation to sign off on an environmental impact statement.

Biden and Cuomo have worked together on the rehabilitation of New York City’s airports during the former’s vice presidency, and

VACCINE FROM PAGE 1

vaccine mandate, but implementing one comes with myriad complications, Balboni said.

Not by force The business community has been pondering its options in ensuring a safe workplace, but compulsory vaccination is not at the top of the list, said Kathryn Wylde, president and CEO of the Partnership for New York City. Office professionals are not known for anti-vaccine sentiments, so employers aren’t very concerned about them declining the vaccine, Wylde said. Additionally, this segment can largely opt to work from home, so it might not make a huge difference if some staffers choose not to get the shots, she said. In the retail sector, concerns vary, especially when it comes to workers who interact with the pub-

state with over 74,000 workers, considered requiring employees to get the vaccine but decided against it. “We recognize that we work with vulnerable populations and we need to keep our employees and patients safe,” said Maxine Carrington, the health system’s deputy chief human resource officer. But Northwell ultimately decided that a heavy-handed approach was against its workplace culture and would be counterproductive to compliance, she said. In December the health system conducted a survey on vaccine sentiment within a limited pool of employees and found 60% of its workers wanted it, 37% were unsure, and 3% said they would not take it. Northwell sought to address the uncertainty, and after an education and publicity campaign, the rate of unsure employees came down, Carrington noted. “People tend to have a ‘You take it first and I’ll see how you do,’ mentality,” Carrington said with a laugh. She pointed out that a hardline approach could lead employees to leave. “Workers might think, If you’re going to force me to take it, I’ll go work for someone else who won’t force me,” she said. Andy Pallotta, president of the New York State United Teachers, a union that represents 600,000 educators, agreed that workers should be given the right to choose whether to be vaccinated and encour-

“WORKERS MIGHT THINK, IF YOU FORCE ME TO TAKE IT, I’LL WORK FOR SOMEONE ELSE” lic, Wylde said. She recounted that a large retailer she spoke with said it would recommend that its employees get the vaccine and facilitate their doing so but would not mandate it. Similarly, Northwell Health, the largest private employer in the

18 | CRAIN’S NEW YORK BUSINESS | JANUARY 11, 2021

AP PHOTO

“THERE IS NO MANDATE FOR A LEFT-WING, AOC-STYLE RESCUE OF THE CITY AND STATE”

As majority leader, Schumer will hold tremendous power in dictating the terms of the political conversation and deciding which bills see the Senate floor for a vote. The senator has not been shy in his role as minority leader in calling for increased federal spending to help the city and the state recover from Covid-19. History could be a guide as to how a Democrat-led federal government will legislate funds to New York. Under President Barack Obama’s $831 billion Recovery and Re-investment Act in 2009, the city benefited from different categories of federal funding allocated by the state, says James Parrott, an economist at the New School. This included billions for Medicaid, education, infrastructure, housing and community development blockgrant money. The state received $15 billion in

aged to do so at the same time. “We believe [all education professionals] should be given priority access to the Covid-19 vaccine should they choose to receive it when it becomes available,” he said. A vaccine mandate could be resisted by labor unions. Although it’s unlikely a pre-Covid-19 collective-bargaining agreement would have covered a pandemic, any new issues that arise are negotiable, said Chamtouli Huq, associate professor at the City University of New York School of Law. Unions would want to be involved in the conversations on vaccines, as ultimately their goals of

protecting the workplace align with the employer’s, said Pat Kane, executive director of the New York State Nurses Association.

Gray areas Despite the EEOC guidance, there are still gray areas. Employers have to consider whether a vaccination is a business necessity and the legal implications of enforcing such a requirement. A business owner who wants to mandate vaccinations would want to be given proof one was taken. And any time medical information has to be collected, potential liabilities are triggered, Huq said. Legal pitfalls could include the Americans with

direct aid in the 2020 Cares Act and $7.8 billion in direct aid for transportation, education and health care in the Dec. 27 Covid-19 stimulus bill passed by Congress. It’s not clear what an additional stimulus package of local aid would look like under the Democrats. “It’s likely to come related to different program areas, but it would be good if some came in a flexible category that the city could use,” Parrott said. “Vaccine distribution and public health investments are also likely in the wake of Covid-19.” One specific change that Democrats could usher through both chambers of Congress is a repeal of the state and local tax cap, which has affected high-income, high-tax states such as New York, New Jersey and Connecticut by reducing the amount of local taxes that citizens may deduct on their federal income tax forms. SALT was passed under Trump’s 2017 tax cut legislation. “They’ve done tremendous damage, and then they literally changed the tax code to redistribute income from the state of New York to Republican states,” Cuomo said. Whether it’s repealing unfavorable legislation or passing billions in stimulus spending, Schumer and the Democrats will need to move strategically in order to maximize their newfound power. “We need to balance hope and opportunity,” said Andrew Rein, president of the Citizens Budget Commission. “He’ll have a nationwide obligation, but he understands our issues, which is a great thing for the city.” ■ Disabilities Act, Title VII of the Civil Rights Act, the Health Insurance Portability and Accountability Act (better known as HIPAA) and even the Pregnancy Discrimination Act, she said. “It could be possible that a worker is trying to become pregnant and hence declines the vaccine, and there are federal, state and city protections for that worker,” Huq said. Although the city’s Commission on Human Rights has not commented specifically on the EEOC guidance, its definition of a disability tends to be broad and has historically offered favorable protection to employees, Huq said. Employers should consider less intrusive solutions before considering mandatory vaccines if the intention is to keep the workplace safe, Huq said. Measures such as temperature taking, symptom monitoring and mask wearing can still be required even after vaccines are available, she said. After all, a vaccine does not magically make the workplace safer, Kane said. “People will eventually come round to taking the vaccine with time and education,” she said, “and until herd immunity is achieved, it is important not to take a punitive approach.” ■

FROM PAGE 3

Zielinska, 28, who at age 19 had to step away from dance for two years as she struggled with depression, anxiety and eating disorders. “The feeling of isolation, the stigma, all that is from my lived experience,” she said, adding, “I know I’m very lucky to be in my position when the dance world is struggling so badly.” The pandemic has devastated all the performing arts but has been especially hard on dance, a genre with challenging economics in the best of times. The art form doesn’t lend itself to long-running shows, and most companies operate on a shoestring budget. Dance/NYC estimates that eight dance studios or organizations have closed or are in the process of closing and five others may soon go under. The research and advocacy organization expects “significantly” more companies starved of ticket revenue to throw in the towel.

fits are scheduled to expire at the end of March. “Individual dance workers now express more need for basic food and shelter than in March, when salaries/wages were the most prevalent need,” Dance/NYC said in an August report. “The crisis may be shifting the size and makeup of the field.”

New moves Bereft of jobs, some dancers have refashioned themselves as census workers, worked in election outreach or formed advocacy groups. Pavan Thimmaiah, founder of PMT House of Dance in the Flatiron District, helped launch the Dance Studio Alliance, which is petitioning the city to reopen rehearsal spaces. J. Bouey, a member of the Bill T. Jones/Arnie Zane Company, and artist Melanie Greene helped create a relief fund through the Dance Union podcast. American Ballet Theatre principal ballerina Isabella Boylston created the #BallerinaBookClub. “The dire state of the arts and cultural sector and the absence of comprehensive structures and relief have given rise to a wave of activism, collaboration and organizing in the sector,” said Alejandra Duque Cifuentes, executive director of Dance/NYC. Dancers at Gibney were well positioned when the dance world stopped just before spring performances. Advocacy work is a core part of the company’s mission, and

“DANCE WORKERS NOW EXPRESS MORE NEED FOR BASIC FOOD AND SHELTER” Between gigs and part-time jobs, the average dancer made $33,000 a year before Covid-19. Many rely on special unemployment benefits made available to freelancers when the pandemic struck; those bene-

CAMPBELL is working with young people through Move NYC.

SCOTT SHAW

DANCERS

full-time, salaried dancers are expected to engage in activism in the dance field and community at large. Zielinska’s project to help with dancers’ mental health issues launched two years ago, so she had counselors at the ready when the pandemic hit. Her advocacy work is supported with grants from philanthropist Andrew A. Davis, the Bay & Paul Foundations and the Laurie M. Tisch Illumination Fund. “They have really stepped up during this difficult period and are literally sustaining us,” founder and Chief Executive Gina Gibney said of her company’s donors. “We practice entrepreneurial artistry,” added Gibney Director Nigel Campbell, who this year has dedicated his time to Move NYC, a

nonprofit that he incubated at the company and which trains 40 New York public school students a year for college and careers in the performing arts. It’s not easy to train bodies over a computer, but the organization has adapted by slowing schedules and offering more breaks. Videographers have been brought in so students look good in their remote auditions. “If you don’t have a professional videographer, you’re at a serious disadvantage now,” said Campbell, a native of Co-op City in the Bronx and a Juilliard graduate. “It’s hard to reinvent the wheel.” Jie-Hung Connie Shiau joined the company in late summer, after a fortunately timed $2 million donation in January enabled Gibney to double in size to 12 dancers.

Shiau is developing a project around body-shaming. In addition to interviewing dancers, nutritionists and fitness coaches, she will ask choreographers to make videos showing their favorite dance moves step by step. “I want to challenge people to find joy in their own bodies,” Shiau said. In the meantime, she and other Gibney members recognize they are among the luckiest dancers in the city because they know one day they will work again. The company plans to resume performances next November at the Joyce Theater, one of the most distinguished venues in dance. “It’s so far away, I really don’t think about it much,” Shiau said. “My mind is occupied with other things.” ■

BANKING & FINANCE

BY AARON ELSTEIN

ew York Community Bancorp Chief Executive Joseph Ficalora, who in a 55-year career transformed a small Queens savings bank into the city’s largest apartment lender, announced Dec. 28 that he would step down—and followed through three days later. Last week presiding director Michael Levine was appointed nonexecutive chairman, replacing Dominick Ciampa, who will remain on the board. Hanif “Wally” Dahya was named the new independent presiding director.

owners of rent-regulated apartments. In a previous press release, Cangemi said he was looking to “enhance our performance and evolve our business model.” His remark “suggests a greater openness to diversify the business model,” Keefe Bruyette & Woods analyst Christopher McGratty said in a client report. A bank spokesman didn’t immediately respond to requests for comment. New York Community stands out in the world of banking because its loan portfolio is concentrated on New York housing, particularly the rent-regulated kind. Because New Yorkers are keen to hang on to their below-market apartments, the bank’s loans almost never go bad. As long as apartment values continued to rise, landlords took out bigger loans and New York Community prospered. But two years ago that equation got scrambled when the state Legislature limited the amounts that rents can be increased on vacant regulated apartments and constrained how much landlords could increase rents to pay for improve-

“I LOOK FORWARD TO WATCHING NYCB’S SUCCESS FOR YEARS TO COME” The moves mark “the next step in the evolution of the company’s strong corporate governance practices,” said Ficalora’s successor, Thomas Cangemi, formerly the bank’s chief financial officer. The timing and speed of Ficalora’s departure was a surprise for the conservative institution, which for decades has focused on lending to

ments. The pandemic raises questions about long-term demand for New York housing, regulated or otherwise. New York Community’s reliance on the local market made it a favorite target for investors betting against the city’s future. Its stock lost as much as one-third of its value in 2020 before ending the year down only 12%, a performance in line with its peers. Under new leadership, New York Community is expected to acquire another bank within the next 18 months, Janney Montgomery Scott analyst Christopher Marinac said in a client report. One likely target: HSBC’s U.S. retail business. That would be a relatively easy deal to swallow for New York Community, which during Ficalora’s long tenure gobbled up several smaller local lenders to make it the $55 billion-in-assets institution it is today, with 236 branches.

Started as a teller Ficalora, 74, grew up in Corona, Queens, where he shared a bedroom with two brothers, and joined a predecessor of New York Community as a teller in 1965 at age 18. He received his business degree by taking night classes at Pace Univer-

FICALORA

sity. He served two years in Vietnam while in the military. Ficalora was named chief executive officer of New York Community in 1993, when the bank went public. “I am thankful for the support and confidence shown to me by the board during my tenure as president and CEO,” Ficalora said in a

press release. “I would like to thank all of our employees.” “Banking is at heart a simple business: You take deposits, make loans, and you don’t take big risks,” Thomas Kahn, president of Kahn Brothers, an investment firm and longtime NYCB shareholder, told Crain’s in 2012. “A lot of people forgot that. Joe never did.” ■

JANUARY 11, 2021 | CRAIN’S NEW YORK BUSINESS | 19

LARRY FORD

Longtime New York Community Bancorp CEO abruptly makes his departure

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Notice of Qualification of PREMIUM BRANDS OPCO LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 12/21/20. Office location: NY County. LLC formed in Ohio (OH) on 1 2/02/20. Princ. office of LLC: 7 Times Sq., NY, NY 10036. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to c/o Corporation Service Co., 80 State St., Albany, NY 12207-2543. Cert. of Form. filed with Secy. of State, 180 E. Broad St., 1st Fl., Columbus, OH 43215. Purpose: Any lawful activity.

NOTICE OF FORMATION OF: Meridian Healing Services LLC Articles of Organization filed with the Secretary of State of NY (SSNY) on 9/25/2020. Office location: New York County. SSNY has been designated as agent upon whom process against it may be served. The Post Office address to which the SSNY shall mail a copy of any process against the LLC served upon him/her is: BUSINESS FILINGS INCORPORATED 187 WOLF ROAD SUITE 101 ALBANY, NY 12205. The principal business address of the LLC is 1177 Avenue of Americas, 5th Floor 10036

Notice of Qualification of MARC JONES CONSTRUCTION, L.L.C. Appl. for Auth. filed with Secy. of State of NY (SSNY) on 11/04/20. Office location: NY County. LLC formed in Louisiana (LA) on 07/20/07. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to c/o Corporation Service Co., 80 State St., Albany, NY 12207-2543. LA addr. of LLC: 22171 McH Rd., Mandeville, LA 70471. Cert. of Form. filed with LA Secy. of State, 8585 Archives Ave., Baton Rouge, LA 70809. Purpose: Sales and installation of residential/ commercial photovoltaic systems including all electrical wiring. Residential energy efficiency grading & upgrades. Notice of Qualification of ACELLA PHARMACEUTICALS, LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 12/11/20. Office location: NY County. LLC formed in Delaware (DE) on 11/06/07. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to c/o Corporation Service Co. (CSC), 80 State St., Albany, NY 12207-2543. DE addr. of LLC: CSC, 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with Secy. of State, 401 Federal St., #4, Dover, DE 19901. Purpose: Any lawful activity.

Notice of Qualification of HUDSON PELHAM HOUSE ASSOCIATES LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 11/25/20. Office location: NY County. LLC formed in Delaware (DE) on 11/20/20. Princ. office of LLC: c/o The Hudson Companies Inc., 826 Broadway, 11th Fl., NY, NY 10003. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to the LLC at the addr. of its princ. office. DE addr. of LLC: 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with Secy. of State, 401 Federal St., Ste. 4, Dover, DE 19901. Purpose: Any lawful activity. NOTICE OF QUALIFICATION of HVPG JACKSON TERRACE MANAGER, LLC. App. for Auth. filed with Secy of State of NY (SSNY) on 12/22/20. Office location: New York County. LLC formed in Delaware (DE) on 10/5/20. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to: c/o 28 Liberty Street, New York, NY 10005. DE address of LLC: c/o 1209 Orange Street, Wilmington, DE 19801. Arts. of Org. filed with DE Secy of State, Townsend Bldg, Dover, DE 19901. Purpose: any lawful activity. MP 125Q LLC. Arts. of Org. filed with the SSNY on 12/03/20. Office: New York County. SSNY designated as agent of the LLC upon whom process against it may be served. SSNY shall mail copy of process to the LLC, 140 East 56th Street, Suite 1D, New York, NY 10022. Purpose: Any lawful purpose. Notice of Formation of WOOVANI LLC. Arts. of Org. filed with Secy. of State of NY (SSNY) on 12/18/20. Office location: NY County. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to: the Company, c/o 141 East 72nd St., 4th Fl., NY, NY 10021. Purpose: any lawful activities.

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NOTICE OF FORMATION OF GY HONG KONG, LLC. Articles of Organization were filed with the Secretary of State of New York (SSNY) on 11/20/2020. Office Location: New York County. SSNY has been designated as agent upon whom process against it may be served. The Post Office address to which the SSNY shall mail a copy of any process against the LLC served upon him/her is 36 West 47th Street, W03, New York, NY 10036. The principal business address of the LLC is 36 West 47th Street, W03, New York, NY 10036. Purpose: any lawful act or activity. NOTICE OF FORMATION OF MOVING BODIES FORWARD, LLC. Articles of Organization filed with the Secretary of State of NY (SSNY) on 10/27/20. Office location: New York County. SSNY has been designated as agent upon whom process against it may be served. The Post Office address to which the SSNY shall mail a copy of any process against the LLC served upon him/her is: United States Corporation Agents, Inc., 7014 13th Ave, Suite 202, Brooklyn, NY 78717. The principal business address of the is 315 E86th Street #16DE, New York, NY, 10028. Notice of Formation of DLS HR Solutions LLC. Arts of Org filed with secy . of State of NY (SSNY) on 10/6/20. Office location: BX County. SSNY designated as agent upon whom process may be served and shall mail copy of process against LLC to 1740 Mulford Ave, Apt 19H, Bronx, NY 10461. Purpose: any lawful act.

Notice of Qualification of ILLUMINATE FM LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 12/03/20. Office location: NY County. LLC formed in Delaware (DE) on 08/ 19/19. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to the LLC, 205 Hudson St., 7th Fl., NY, NY 10013. DE addr. of LLC: c /o Corporation Service Co., 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with DE Secy. of State, Div. of Corps., 401 Federal St., Ste. 4, Dover, DE 19901. Purpose: Any lawful activity.

Notice of Qual. of 502 PARK HOLDINGS, LLC, Authority filed with the SSNY on 09/04/2020. Office loc: NY County. LLC formed in DE on 04/ 01/2019. SSNY is designated as agent upon whom process against the LLC may be served. SSNY shall mail process to: The LLC, 233 Wilshire Blvd., Ste 850, Santa Monica, CA 90401. Address required to be maintained in DE: CSC, 251 Little Falls Drive, Wilmington DE 19808. Cert of Formation filed with DE Div. of Corps, 401 Federal St., Ste 4, Dover, DE 19901. Purpose: Any Lawful Purpose.

Notice of Qualification of ROUND SHRUB PRODUCTIONS, LLC. Authority filed with Secy. of State of NY (SSNY) on 10/30/20. Office location: NY County. LLC formed in Delaware (DE) on 10/19/20. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to: c/o Paracorp Incorporated, 2804 Gateway Oaks Dr., Ste. 100, Sacramento, CA 95833. Address to be maintained in DE: 2140 South Dupont Hwy., Camden, DE 19934. Arts of Org. filed with the Secy. of State, 401 Federal St., Dover, DE 19901. Purpose: any lawful activities.

Notice of Formation of MS RESIDENCE LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 12/23/20. Office location: NY County. Princ. office of LLC: Philip J. Michaels, c/o Norton Rose Fulbright US LLP, 1301 Ave. of the Americas, NY, NY 10019. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to the LLC at the addr. of its princ. office. Purpose: Any lawful activity.

David Sable, LLC, Arts of Org. filed SSNY 2/10/20. Office: NY Co. SSNY designated agent of LLC upon whom process may be served & mail to David Sable, 201 West 70th St., 11HI, NY, NY 10023. General Purpose.

S H A R E

Y O U R

Notice of Formation of SIGNATURE SP 3, LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 11/19/20. Office location: NY County. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to Corporation Service Co., 80 State St., Albany, NY 12207-2543. Purpose: Any lawful activity.

NY PRINCIPAL LLC, Arts. of Org. filed with the SSNY on 09/25/2020. Office loc: NY County. SSNY has been designated as agent upon whom process against the LLC may be served. SSNY shall mail process to: Ed Gitlin, 33 West 60th Street Ste 2-1, NY, NY 10023. Reg Agent: Ed Gitlin, 33 West 60th Street Ste 2-1, NY, NY 10023. Purpose: Any Lawful Purpose

Notice of Formation of OMAHA FALLS II LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 12/07/20. Office location: NY County. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to Robert Milam, 150 Charles St., Unit M3, NY, NY 10014. Purpose: Any lawful activity.

Notice of Formation of MERIDIAN BRANDS LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 11/24/20. Office location: NY County. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to Corporation Service Co., 80 State St., Albany, NY 12207-2543. Purpose: Any lawful activity.

NOTICE OF FORMATION of Bardock Sales, LLC. Arts of Org filed with Secy. of State of NY (SSNY) on 9/ 23/20. Office Location: NY County. SSNY designated as agent upon whom process may be served and shall mail copy of process against LLC to 300 E 34th St, 35H, NY, NY 10016. R/A: US Corp Agents, Inc. 7014 13th Ave, #202, BK, NY 11228. Purpose: any lawful act.

Notice of Qualification of REVANTAGE RISK SERVICES, LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 11/25/20. Office location: NY County. LLC formed in Delaware (DE) on 08/14/20. Princ. office of LLC: 233 S. Wacker Dr., Ste. 4700, Chicago, IL 60606. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to c/o Corporation Service Co. (CSC), 80 State St., Albany, NY 12207-2543. DE addr. of LLC: c/o CSC, 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with Secy. of State, Div. of Corps., John G. Townsend Bldg., 401 Federal St., Ste. 4, Dover, DE 19901. Purpose: Any lawful activity.

C O M P A N Y ’ S

Notice of Qualification of PULSE ANALYTICS, LLC. Authority filed with Secy. of State of NY (SSNY) on 11/ 16/20. Office location: NY County. LLC formed in Delaware (DE) on 11/ 13/09. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to: One Pennsylvania Plaza, Ste. 2505, NY, NY 11901. Address to be maintained in DE: c/o Business Filings Incorporated, 108 West 13th St., Wilmington, DE 19801. Arts of Org. filed with the Secy. of State, Division of Corporations, John G. Townsend Bldg., 401 Federal St., Ste. 4, Dover, DE 19901. Purpose: any lawful activities.

J O U R N E Y

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PEOPLE ON THE MOVE

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ACCOUNTING

ADVERTISING / MARKETING

FINANCIAL SERVICES

HEALTH CARE

DDK & Company, LLP

Stran Promotional Solutions

Chrysalis Holdings LLC

Consumer Directed Choices

DDK & Company LLP, a leading accounting, tax, and consulting firm, is pleased to announce that Sze Man Tam has been promoted to Partner. Sze has 16 years of experience in accounting, audits, and business consulting. She specializes in non-profits, real estate, manufacturing, distributions and wholesalers, art galleries, jewelry, and employee benefits plans. She looks forward to developing the next generation of future leaders at DDK, and contributing to the growth and success of the firm.

Long-time business leader and merchandising entrepreneur Nicholas Mirabile has been named Vice President of Merchandising and Licensing at Stran Promotional Solutions, the premiere distributor of branded merchandise and services to leading organizations across the world and a top 50 distributor of promotional products in the United States. Mirabile was named ASI Advantages Salesperson of the Year 2020, an annual awards program that recognizes the most outstanding salespeople in the industry.

David Olson, CEO of Chicago investment bank Wind River Capital LLC, was named chairman of Chrysalis Holdings LLC, an investment company that builds and grows fintech businesses, including VA mortgage lender NewDay USA. Olson has been an advisor to Chrysalis and NewDay USA since 2009 and provides value and direction for NewDay USA’s future growth. He was vice-chairman of The Financial Institution Group (FIG) at Piper Jaffray and chairman & CEO of Guggenheim Merchant Banking. Olson was also chairman of Credit Suisse First Boston for the Asia-Pacific region and held several senior executive positions at DLJ, including chairman & CEO of the Asia-Pacific region. Olson holds a JD from Northwestern University School of Law.

Kimberly Browne was named President of Chrysalis Holdings LLC, an investment company focused on building and growing successful fintech businesses, including VA mortgage lender NewDay USA. Browne brings two decades of financial services experience in residential lending, capital markets and operations. She will lead corporate finance, capital market strategies and investor relations. Browne is a former managing director of UBS where she helped relaunch its residential mortgage finance business and grew the platform to a top-five lender in the country. Browne oversaw collateral valuation, credit risk management, regulatory audits and financial analysis. She earned a bachelor’s degree in business administration from Texas A&M University.

Christopher Graber has been named Chief Executive Officer of Consumer Directed Choices to lead the $42 million nonprofit organization. Since 1997, CDChoices, headquartered in Albany, N.Y., has helped seniors and individuals with disabilities maintain independence by empowering them to manage their own home care. Chris has been employed with CDChoices since 2006, appointed to Interim CEO in July 2020 and, immediately prior to that, he was the corporation’s Chief Financial Officer for nine years.

PROMOTE. Why not?

CRAINSNEWYORK.COM I OCTOBER 26, 2020 I

CRAINSNEWYORK.COM I SEPTEMBER 28, 2020 I

ASKED & ANSWERED

experts in tax regulation, audit, estate administration, forensic accounting, Few qualities are more vital to the health of any business than financial organizational transformation, advisory services, fundraising and business equilibrium and organizational efficiency. structure. They represent an extraordinary group of professionals from Rarely has the value of both been more strongly felt than in recent firms of varying size and renown. months. From stress-tested balance sheets to fast-changing regulations, CRAINSNEWYORK.COM I SEPTEMBER 28, 2020 I To find these honorees, Crain’s consulted with trusted sources in the and reconfigured supply chains to “new normal” working arrangements, business world in general and in the accounting and consulting realms in the Covid-19 pandemic has challenged even the strongest of businesses. particular. The nominations submitted by individuals and firms in the New Standing tall within this chaotic breach are the foot soldiers of profesexperts in tax regulation, audit, estate administration, forensic accounting, Few qualities are more vital to the health of any business than financial York metropolitan area were rigorously vetted. Ultimately, each of the acsional service firms, led by accountants and management consultants. organizational transformation, advisory services, fundraising and business equilibrium and organizational efficiency. counting and consulting notables was chosen for her career achievements In selecting the 86 honorees for this year’s list of Notable Women in structure. They represent an extraordinary group of professionals from Rarely has the value of both been more strongly felt than in recent and involvement in industry and community organizations—and at times Accounting and Consulting, Crain’s sought to spotlight the accomplished firms of varying size and renown. months. From stress-tested balance sheets to fast-changing regulations, 28, 2020 I her effortsCRAINSNEWYORK.COM to help New York reboundI SEPTEMBER from the coronavirus. metropolitan area professionals and problem-solvers who keep businessTo find these honorees, Crain’s consulted with trusted sources in the and reconfigured supply chains to “new normal” working arrangements, Read their biographies and learn how the members of this remarkable es churning. The talented individuals presented here are a diverse group, business world in general and in the accounting and consulting realms in the Covid-19 pandemic has challenged even the strongest of businesses. cohort keep the gears of business whirling. skilled at resourceful innovation and disruptive thinking. These women are The nominations by individuals andadministration, firms in the New Standing tall within this chaoticare breach the soldiers profesexperts insubmitted tax regulation, audit, estate forensic accounting, Few qualities moreare vital tofoot the health ofof any businessparticular. than financial York metropolitan organizational area were rigorously vetted. Ultimately, each of the acsional service firms, led by accountants and management transformation, advisory services, fundraising and business equilibrium and organizational efficiency.consultants. counting and consulting notables chosenan forextraordinary her career achievements In selecting the 86 honorees for this list been of Notable structure. They was represent group of professionals from Rarely has the valueyear’s of both more Women stronglyinfelt than in recent andregulations, involvement infirms industry and community organizations—and at times Accounting and Consulting, Crain’s sought to spotlight the accomplished of varying size and renown. months. From stress-tested balance sheets to fast-changing efforts to help New from theCrain’s coronavirus. metropolitan area and professionals andsupply problem-solvers businessTo York find rebound these honorees, consulted with trusted sources in the reconfigured chains to who “newkeep normal” working her arrangements, Read their biographies learn how theand members this remarkable es churning. The talented individuals presented here are aeven diverse group, of businesses. businessand world in general in the of accounting and consulting realms in the Covid-19 pandemic has challenged the strongest cohort the gears of business whirling. submitted by individuals and firms in the New skilled at resourcefulStanding innovation and disruptive thinking. Theseare women aresoldiers particular. The nominations tall within this chaotic breach the foot of keep professional service firms, led by accountants and management consultants. In selecting the 86 honorees for this year’s list of Notable Women in Accounting and Consulting, Crain’s sought to spotlight the accomplished metropolitan area professionals and problem-solvers who keep businesses churning. The talented individuals presented here are a diverse group, skilled at resourceful innovation and disruptive thinking. These women are

LAURA PETERSON

York metropolitan area were rigorously vetted. Ultimately, each of the accounting and consulting notables was chosen for her career achievements and involvement in industry and community organizations—and at times her efforts to help New York rebound from the coronavirus. ers rss of this remarkable re remarkab r Read their biographies and learn how the members cohort keep the gears of business whirling.

Managing Director and Communications, Media and Technology Northeast Business Leader Accenture

LAURA PETERSON

Laura Peterson’s résumé lists a whopping 10 positions she’s held at the multinational professional services company Managing Director and Communications, Media and Technology Northeast Business Leader Accenture since joining the firm in 2000. In her current role as Accenture the Northeast business lead for communications, media and technology, the enterprising ladder climber presides over a team Laura Peterson’s résumé lists a whopping 10 positions she’s of 3,000 professionals. Peterson is charged with managing a $750 held at the multinational professional services company and Media and Technology echnology Northeast B Business usines ss Lead Leader der er million profit-and-lossManaging statementDirector for clients inCommunications, the Accenture since joining the firm in 2000. In her current role as aforementioned sectors as well as the high tech sector. Peterson Accenture the Northeast business lead for communications, media and works with key business leaders among more than 40 clients and technology, the enterprising ladder climber presides over a team Laura Peterson’sstructure. résumé lists a whopping within Accenture’s global management Since 2017, she 10 positions she’s of 3,000 professionals. Peterson is charged with managing a $750 y held the multinational professional company has been a board adviser to at Fairygodboss, an online platformservices that million profit-and-loss statement for clients in the Accenture since joining the firm in 2000. In her current role as seeks to elevate women in the workplace. aforementioned sectors as well as the high tech sector. Peterson the Northeast business lead for communications, media a and works with key business leaders among more than 40 clients and technology, the enterprising ladder climber presides over ver a team Reprinted with permission from Crain’s New York Business. © 2020 Crain Communications Inc. All rights reserved. Further duplication without permission is prohibited. #NB20073 Since 2017, she within Accenture’s global management structure. of 3,000 professionals. Peterson is charged with managing ng a $750 has been a board adviser to Fairygodboss, an online platform that million profit-and-loss statement for clients in the seeks to elevate women in the workplace. aforementioned sectors as well as the high tech sector. Peterson works with key business leaders among more than 40 clients ients and Reprinted with permission from Crain’s New York Business. © 2020 Crain Communications Inc. All rights reserved. within Accenture’s global Further management duplication without permission structure. is prohibited. #NB20073Since 2017, she has been a board adviser to Fairygodboss, an online platform atform that seeks to elevate women in the workplace.

LAURA PETERSON

PAT WANG Healthfirst

INTERVIEW BY JENNIFER HENDERSON

at Wang, president and CEO of Healthfirst, a nonprofit insurer formed by a group of health care systems, had been working to advance value-based care long before the pandemic. The concept involves paying hospitals and physicians based on their patients’ outcomes rather than on the volume of services they provide. Now, as health care providers face unprecedented financial strain due to the Covid-19 crisis, Wang says such payment arrangements are more critical than ever. Not only do they improve the quality of care for patients—including the 1.5 million plan members Healthfirst serves throughout the city, Long Island and surrounding areas—but they also generate fiscal benefit for the facilities, practices and health centers that serve them. How does Healthfirst contribute to value-based care? What you understand as profit in another health insurance company’s balance sheet at Healthfirst is contractually-driven surplus that goes back to the delivery system. Eighty percent of the premiums we get for medical services flows through value-based payment arrangements, which means that providers benefit when there is a surplus in the premium. If less money is spent on fee-for-service claims, the surplus is part of the contractually-obligated payment stream. What has that meant during the pandemic? For April through June, we are distributing $250 million in those surpluses [about double that of the same period last year], and we’ve expedited the calculation and reconciliation of those amounts to get them out the door faster because the delivery system really needs it. Why are value-based payments vital now and in normal times? In the best of times, we have always been trying to push for this model because it aligns the incentives around trying to keep people healthy and avoiding unnecessaryy care. The p providers are aligned with that g goal because theyy benefit g from it if they can reduce avoidable care. Consider Covid-19 to be like a war. there In war times, times the model has b been a lifesaver because th ere is this artificial depression d epression pre essio on of u utilization utilization, tilization, lization, za atiion, ion a and nd d th that’s that s w why the providers s have lost so much muc money—their m oney oney—their ne ey—their th revenue has dried up. But because we have have tthese hese e risk isk contracts contracts, tthe e surplus that is there, that’s what has gone out the door do to them.

DOSSIER WHO SHE IS President and CEO, Healthfirst AGE 66 BORN Jersey City RESIDES Manhattan EDUCATION Bachelor’s in history and East Asian studies, Princeton University; J.D., New York University School of Law FAMILY MATTERS Wang is married and has one son who lives in Brooklyn. GLOBAL TIES She has lived in Croatia, Taiwan as well as China, where she had more than 20 first cousins. FLARE FOR FOOD Wang has become reacquainted with the joy of cooking as a result of the pandemic. EYE ON MEDICAID About three-quarters of Healthfirst’s members are Medicaid beneficiaries. The insurer’s initial response to the crisis included having its care managers make sure members had medicine and durable medical equipment to stay at home safely. BUDGET CUTS Wang says the magnitude of the state’s Medicaid cuts—instituted to pare back on spending growth—is devastating. “Cuts to us as a Medicaid plan p are cuts ts to hospitals hospitals. hospitals.””

services? What happens h happen pp when patients p s again g begin b g seeking services s ? encouraging members because We do o see utilization tiliza ation coming g back back,, an a and we e have hav ave been enc ouraging ging g g our m embers emb bers to get g needed care care b ec e ecause c whether brings things people have putt a lot of stuff off. We have to o see se s ee whet wh her the bounce back is gigantic or it just st b br bri rin ngs tth hings back state. back utilization trying to a steady state e If w we go b ack to o a more normal norm utili zation pattern, pattern atttern, then th the he regular regular incentives of of tr r yin ry y ng ng tto o align care, around und g good p preventive care and avoiding g unnece unnecessary ecessar essa c ca re, e, they hey just kick iin. in safely pandemic? How How wc can an the the city c ciiity ty sa saf bounce back from the pandem m c? mic ? on the public health measures Continue Co ontinu n nttinue in nue ue doubling d doubli oubling oub bliiin ng down do d s already already in place: wearing masks, social distancing diis stanc ta an ncing and singular learning han ha hand and nd n ds sanit sanitation. an nitttation a on n. We W know what to do. But I think a sing gular focus on getting the schools open fo for orr ffull ull le earning should measure should h ld top t the th he e list of what hat we a are aiming aimi for. for fo We shoul ld m easure our success against that goal. As A an employer, employer, back work I can tell you that hat we will ill ill not b be able bl ble to get g fu ffully full ba ck tto ow ork until the thousands of employees with w wit itth school-age school -age course children can get their kids back into school. It’s of cours se better for all children and particularly critical cr crit rittic cal for poorer children. The city’s city s economic recovery is going goin to hinge hinge on on how quickly and how well we can get ge that th ha at done done so that do that of the city who has watched us parents can resume their normal lives too. too As A a longtime longtim me resident re s recover recov over from I believe in the city’s recession, ecession, es ss sion, 9/11 and d Hurricane H i ane Sandy, Hurrica S Sandy San Sa an cityy’s s ability to bounce back against the odds. odd ds s. But But this about time me e is going ing g testt all all of us, us and a we w should s sh be sober ab bo outt th the need for everyone to contribute to the tth he solution. solution. industry? Whatt challenges face the broader broade in bro insurance industry y? expectations of consumers who Balancing ncing the needs s and d ex expectation expe expectat xpectatio t ti w wh ho need need and deserve good health care coverage, coverag cove rage, expanddoing it within an increasingly ing ng g access ccess however we can n and an a d doi oi incre ea asingly ngly constrained economic environment. environme environmentt. This This s is budget situation is dire at the same time espec especially specially cially true ue w with Medicaid Medicaid, M aid id, wh where whe the state’s budge et s ituation tu me as people’s people s needs needs million are increasing. g. Given that He Healthfirst rs st has over 1 millio n Medicaid Med edicaid members, the potential impact off the the state’s For budget b udget get et is especially ecially concerning concerni concerning. ni Fo or me, m our priority has has to to be enabling as many people as possible possib pos ble e to o have full full challenge access ess tto high-quality high h lit care, e,, and d it’s it’ i sg going to be a cha lllenge to figure out how to do that in this economic e eco on o nom omic environenvironmindful of the hurt being ment. t. Insurers also need ne tto o be b mindf mind nd bein ng experienced xperienced by so much of the provider delivery d de ellivery iv ve v e system. system. doctors, The value of our products produ re relies elies liie on o having ha h strong docto ors, hospitals and community resources.. Balancing Ba allanc an ncing all of going this his in a financially financia nc y viable way wa ayy is g go goi oing to be a challenge. challeng ge. ■ Reprinted R eprinted with permission permiisssio on from f Crain’s ain’s Ne New York Business Business.. © 2020 Crain ain C Communications om mmunications Inc. Al All ll rights rrig ig ghts reserved. re rese erv ved. urther duplication without permission is prohibited. prohib proh bite ted d. #N NB20080 Further #NB20080

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Latham & Watkins LLP

Hodgson Russ is pleased to announce Joseph Bolognese has joined the Corporate & Business Practice as an Associate. He represents domestic and international clients on a variety of business transactions, including mergers and acquisitions, and general corporate matters. Joe has experience in securities regulation and compliance, including public company reporting and federal and state law aspects of private offerings. He is admitted to practice in New York, and is based in our New York City office.

Hodgson Russ is pleased to announce Doran Gittelman has joined the State & Local Tax Practice as an Associate. He handles disputes involving the New York State and City Tax Departments and counsels businesses and individuals on a range of multi-state, state and local tax issues. Prior to joining Hodgson Russ, Doran worked at Deloitte where he handled state and local tax controversies. Doran is admitted to practice in New York, and is based in our New York City office.

Hodgson Russ is pleased to announce Katherine Piazza has joined the State & Local Tax Practice as an Associate. Katie focuses on state and local tax litigation and planning, and represents clients in a wide range of multi-state tax issues, from planning and compliance to audit and litigation. She also counsels clients on tax and residency planning. Katie is admitted to practice in Pennsylvania, with New York State admittance pending. She is based in our New York City office.

Alison (Ali) Haggerty has joined the New York office of Latham & Watkins as a partner in the Capital Markets Practice within the Corporate Department. Haggerty advises issuers, predominantly in the technology and life sciences industries, and underwriters on capital markets transactions, with an emphasis on initial public offerings, follow-on equity offerings, and convertible debt offerings. She regularly counsels publicly-traded companies on general corporate and securities law matters.

Hub Truck Leasing and Rental Company

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Hub Truck Leasing and Rental, the largest EmployeeOwned Truck Leasing Company in the New York Metropolitan Area, announced that its board of directors has promoted Lance Kaufman to Chief Executive Officer. Lance joined the Company in 1997 as a sales trainee and rose up through the ranks to the position of Vice President of Sales. Kaufman will continue to focus on building a resilient organization and plans to take advantage of the market opportunities ahead.

For listing opportunities, contact Debora Stein at dstein@crain.com or submit directly to

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22 | CRAIN’S NEW YORK BUSINESS | JANUARY 11, 2021

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1/8/21 12:04 PM

SMALL- BUSINESS SPOTLIGHT

HAGEN

FOCAL POINTS

ALL-NATURAL TREATS AS PRETTY AS A PICTURE

COMPANY NAME Supernatural FOUNDED 2017 FULL-TIME EMPLOYEES One

Pandemic bakers’ Instagram posts help propel Supernatural to seven-figure sales BY CARA EISENPRESS

uring the holiday season, as decorated confections filled bakers’ Instagram feeds, dozens of posts featuring vividly colored trees and sprinkle-dotted gingerbread houses tagged the account @gosupernatural. Manhattan-based company Supernatural sold more than $1 million worth of sprinkles and food coloring made from all-natural ingredients last year, three years after its founding. Its sprinkles include the brand’s signature mix Starfetti, a rainbow of stars; Ugly Xmas Sweater, a seasonal offering of yellow, green and white gingerbread men, trees and bells; and Dinomite, a combination of green and blue dinosaur shapes and multicolored nonpareils. “Until now you couldn’t decorate a baked good if you were trying to do it naturally,” said Carmel Hagen, the company’s 36-year-old founder and sole full-time employee. She is an experienced brand marketer who won the Pillsbury Bake-Off in third grade. As an adult, she wondered why the baking aisle at natural foods stores sold almost no decorating supplies. With natural foods coming in a rainbow of vivid colors, she wondered, why wouldn’t we be able to make bright sprinkles? The answer had to do with the chemical in-

stability of natural food coloring and seemed like a compelling problem for someone with the entrepreneurship bug. She had proved her vision in the natural foods space with the coconut sugar company Sweet Revenge, which she launched six months after Adobe Inc. bought the startup where she had been working as a vice president of brand strategy. “It meant throwing myself into the deep end,” said Hagen of the endeavor, “moving thousands of pounds of coconut sugar when before that all I’d done was move something through Dropbox.” The sugar sold rapidly at Whole Foods, she said, and buyers there were supportive when she told them she wanted to try making sprinkles and food coloring. Certain limitations come when you use natural colors, which are often made from fruit and vegetable powders. Before Supernatural, many natural sprinkles and food colors looked drab. Hagen hypothesized it was a research and development issue, so she bought samples from 100 natural color houses—the professional producers of regulatory and approved color—and tested them in her own kitchen at different temperatures, in water and fat, in frosting, in batter, on Easter eggs and at different pH levels. She chose the most vibrant colors, picking beta carotene for an “exquisite yellow,” instead of turmeric,

FOUNDER Carmel Hagen

which had been the standard for natural yellow even though it fades quickly. Blue was another challenge, she said, because it is difficult to find in nature. And when you use it in cooking, changes in pH and heat can slash its vibrancy. Hagen decided to work within the limitations, calling her blue food dye “magic blackberry.” Made with red cabbage juice, the color is blue in water, purple in milk and pink in lemon juice—the “unicorn of plant-based colors,” as described on the site. “We figured we wouldn’t have a blue that’s the level of blue a professional chef needs, but we could use storytelling to give someone something that’s fun to work with,” she said.

SALES STRATEGY In addition to selling at Whole Foods, the company relies on social media, especially Instagram, for word of mouth. The occasional free sample is sent out to certain bakers. Supernatural also takes out Amazon ads. “It’s expensive to send people to your site,” Hagen said. “Until you want to do that, be on Amazon! You just need to be optimized for search.” REVENUE Over $1 million in 2020 PRODUCT MIX All-natural sprinkles ($7.99), coconut sugar ($7.99) and natural food colors ($9.99) WEBSITE supernaturalkitchen.com

Filling a niche Hagen funded both businesses with money from the acquisition and by slowly selling off her Adobe stock. When the first cases of sprinkles sold quickly from Whole Foods in 2017, she felt her idea held promise. She built up an Amazon storefront and launched e-commerce on her own site, as she looked for manufacturers and co-packers who could make the sprinkles as the company grew. “She knew there was a community of bakers and moms who wanted clean baking ingredients, and she listened to what they wanted,” said Zoe Feldman, who runs the Chobani incubator, which Hagen participated in. In 2020 her knowledge of their needs paid

off. More than ever Supernatural users posted their treats on Instagram, and the platform became a big driver of digital sales: Amazon accounted for half of Supernatural’s sales last year. This year, for the first time, Hagen plans to raise outside money, which she will use to hire full-time operations help to grow her distribution channels and launch products— anything in the baking aisle or the category of “playful food” that is all-natural is fair game. “If we can add color and imagination to it without being holier than thou,” she said, “we’re interested.” ■

JANUARY 11, 2021 | CRAIN’S NEW YORK BUSINESS | 23

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