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

ASKED & ANSWERED Garodnick on city’s relationship with real estate PAGE 11

CRAINSNEWYORK.COM

BUM RIDE Medallion investors file a lawsuit against the TLC PAGE 3

| APRIL 26, 2021

STATE OF HOSPITAL CARE

ON THE MEND Covid sent hospitals reeling, but now they say they’re ready for future crises

BY SHUAN SIM AND MAYA KAUFMAN

n the early days of the pandemic, health systems and hospitals were thrown for a loop. Surges in patient volume and the loss of revenue when elective procedures were suspended by state order left local WHO are the facilities feeling pushed to their limits. But in top-paid hospital the ensuing months, and with the crisis appearing executives and to be winding down, they say they have learned doctors? important lessons that will help them change the PAGES 12-14 way they work. “We were built to withstand blows and deliver care,” said Dan Widawsky, chief financial officer of NYU Langone. And in picking themselves back up, health systems have become better prepared for the next disaster, he noted. “An analogy I like to use comes from hockey,” he said. “You don’t want to skate to the puck; you want to skate to where the puck is going.” Having to go through the thick of the pandemic last year without necessary resources really put the old way of doing business into perspective, said Dr. Mitchell Katz, president and CEO of NYC Health + Hospitals. “One of the mistakes of previous management practices is not keeping excess inventory because of the risk of medication or equipment expiring,” he said. That led to the health system being stretched thin when it See MEND on page 14

NYC HEALTH + HOSPITALS

Thinking ahead

NYC Health + Hospitals/Bellevue

POLITICS

Business pans pandemic worker safety bill Legislation could result in increased expenses, more fines and exposure to litigation

NEWSPAPER

VOL. 37, NO. 16

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BY BRIAN PASCUS

he New York business community is urging Gov. Andrew Cuomo to veto a bill that would establish new workplace safety standards and regulations in a post-pandemic world.

Critics said the bill would raise costs, lead to more fines and create a greater likelihood that employers would get mired in lawsuits. The New York Health and Essential Rights Act, or Hero Act, would create enforceable health and safety standards related to airborne

diseases and allow employees to form workplace oversight committees and take legal action against employers without fear of reprisal. Under the bill, the state Department of Health would be granted authority to “establish minimum requirements” with which busi-

GOTHAM GIGS

JPMorgan alum launches financial services startup PAGE 23

nesses must comply in order to prevent the spread of airborne disease. The bill awaits Cuomo’s signature after it passed the Democrat-controlled Assembly and Senate this See HERO on page 22

THE LIST

THE TOP COMMERCIAL OFFICE PROPERTIES PAGE 16

4/23/21 6:33 PM

ENVIRONMENT

Millions of discarded face masks are posing an environmental quandary for the city NEW YORKERS CAN MAKE AN IMPACT BY SWITCHING TO WASHABLE AND REUSABLE MASKS

BY CARA EISENPRESS

Contamination fears The city Department of Sanitation encourages New Yorkers to put single-use masks into the litter baskets on street corners or in household trash bins.

Cookson, senior director of recycling and recovery for the American Chemistry Council.

Advanced recycling

ISTOCK

hanks in part to the city’s face-covering mandate, millions of single-use masks are worn each day before being discarded. The masks become litter on the street, clog storm drains, entangle birds and marine animals, and wind up in landfills. With the second Earth Day of the pandemic having come and gone, this environmental problem still lacks a serious solution. “There should be an opportunity” for reusable and recyclable equipment, said Michael Sinensky, who last year started WeShield, a personal protective equipment company. He has tried to find buyers among his customers, mostly hospitals, for washable masks and gowns, he said. The amount of trash created by masks and gloves is hard to track, said Adrienne Esposito, executive director of the Citizens Campaign for the Environment. She said her organization is working to record and document the year-old problem.

starting collection programs to gather and recycle used masks, Esposito said. Truly recycling masks, gloves and gowns is a longer road. Because PPE items include several different kinds of plastics, it’s difficult to mechanically recycle them.

Early in the Covid-19 crisis, Esposito said, people were flinging or dropping used masks and gloves on sidewalks or scattering them in parking lots out of fear of contaminating their car or home with the coronavirus. The risk of contamination also sidelined any inklings of

But chemical recycling, a newer technology, might have the capability to break down the plastics, as well as other kinds of packaging and products, into their molecular building blocks, which could then be used in the same applications as “virgin” plastics, explained Craig

Recent legislation in Pennsylvania and eight other states aims to create a regulatory environment wherein companies interested in creating advanced recycling programs could invest in facilities. It could one day be a $120 billion industry, Cookson said. In the near term, the city’s Sanitation Department has three new programs to restore and improve garbage collection in neighborhoods—which could help with the PPE litter. The only other impactful move, Esposito said, is for people to switch to wearing washable masks, just as they have found substitutes for other single-use products, such as coffee mugs, reusable water bottles and cloth diapers. ■

WEBCAST CALLOUT

POLITICS

Brooklyn Councilman Deutsch admits to tax fraud but won’t resign

rooklyn Councilman Chaim Deutsch pleaded guilty last Thursday morning to tax evasion regarding income he made from his real estate firm, Chasa Management, but said he will not step down from his post. Deutsch admitted he did not pay $82,000 in taxes on up to $249,000 in income earned between 2013 and 2015. “Over a multiyear period, Deutsch concealed his true business income to avoid paying his fair share of taxes,” U.S. Attorney Audrey Strauss said. As of 2017, City Council members have been barred from earning money outside of the $148,500 annual salary they receive for holding public office. Deutsch announced in 2017 he would forgo his real estate salary in order to run for re-election. Deutsch entered his guilty plea last Thursday in federal court to a

MAY 5

single count of filing a false tax return for 2015, and he agreed to pay at least $82,076 in restitution—the total amount he owes in taxes, plus interest. The charge carries a maximum sentence of one year in prison, a maximum term of one year of supervised release, a maximum fine of $100,000 and restitution. He is scheduled to be sentenced July 29.

NEW YORK CITY’S RESTAURANT REVIVAL The city’s restaurants have been devastated by the pandemic— hundreds of businesses have closed, and thousands of employees have lost their jobs. As the industry begins to recover, there are questions about Covid-19’s impact and what the future has in store. Join Crain’s as we examine which establishments have been hit the hardest, how businesses are evolving and what eateries are doing to bring back diners. Additionally, attendees will learn what actionable steps the government, business community and public can take to help local food entities get back on their feet.

DEUTSCH

Resignation? The councilman “accepts responsibility for his actions and intends to fully repay the $82,000 in taxes he owes,” said Henry Mazurek, Deutsch’s attorney. “Mr. Deutsch’s dedication to public service will not be diminished, and he looks forward to completing his elected term.” But Speaker Corey Johnson called on the councilman to resign. “Council member Chaim Deutsch betrayed that public trust by committing tax fraud,” he said. “Our constituents rightly expect the

NEW YORK CITY COUNCIL

BY NATALIE SACHMECHI

people they vote for to uphold the law. Deutsch failed them. To protect the integrity of the City Council and his Brooklyn seat, he must resign. He can no longer serve his

constituents in good faith.” Deutsch has held his seat since 2014 and is now term-limited, meaning he cannot run for re-election in the 48th district. ■

VIRTUAL EVENT Time: 4 to 5 p.m. CrainsNewYork.com/webcasts

Vol. 37, No. 16, April 26, 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 | APRIL 26, 2021

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CRAIN’S PHOTO COMPOSITE

TRANSPORTATION

BROKEN PROMISES A $2.5 billion lawsuit by taxi medallion owners claims that three Taxi and Limousine commissioners conspired to pump the value of cab permits and hid information when it dropped

BY BRIAN PASCUS

alina Kaminker remembers sitting in the Brighton Beach, Brooklyn, home of her immigrant father in 1992 and being struck by his insistence that she put her retirement money into taxis. He told the then-28-year-old Kaminker and her sister that buying a yellow taxi medallion—a permit for operating a cab—would be the safest way for them to enjoy a stable retirement. That year, at their father’s urging, Kaminker and her sister each put $140,000 of their savings into two medallions. “My father told me that it’s a city promise, an investment, and he believed in it,” she recalled, adding that her Russian family didn’t understand stocks or other financial instruments. “He said, ‘This is something the city sells. It’s a guaranteed investment. It might not have a high ROI, but I’m more than sure you’ll be able to retire on this money.’ ” Today the 57-year-old Kaminker is $500,000 in debt, as her family’s investments in medallions have crashed together with the city’s taxi industry. The value of a medallion has dropped from an average auction price of $1.1 million in 2014

to less than $150,000 today, mainly due to the emergence of Uber and Lyft in the city’s transportation market, which, as Crain’s has reported, went largely unregulated. Kaminker is one of the first two plaintiffs in a $2.5 billion

“I THINK IT’S A WORTHLESS COMMODITY, A BAD BUSINESS, BAD INVESTMENT” class-action lawsuit filed this month against the city Taxi and Limousine Commission, three former commissioners, former Mayor Michael Bloomberg, the city and others. The suit claims they conspired to artificially inflate the price of medallions to enrich city coffers and then did nothing when Uber and Lyft entered the market, causing the cab permit’s value to plummet. “We’re not gamblers. We’re people who put money in something, and we wanted to be secure,” Kaminker said. “The

city promised an investment and promised the medallion is worth a million dollars. Keep your promise.”

Valuable investment The TLC charter, written in 1971, promotes the “continuance, further development and improvement” of taxi and limousine service and mandates the “promise and protection” of public transportation policy governing taxi service. The city’s backing of medallions is at the core of the litigation. Since they first were traded on secondary markets after World War II, medallions’ value rose from $2,500 to $100,000 by the 1980s. Once the city received state approval to issue auctions in the mid-1990s, individual values reached more than $400,000 within a few years. As time passed, the rising value of the investment gave Kaminker and her sister the ability to borrow more money against what they initially paid. The new medallion values put their children through school, and they refinanced every three years, she said. “The city was actually marketing the medallion as a safe See BROKEN on page 22 APRIL 26, 2021 | CRAIN’S NEW YORK BUSINESS | 3

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HEALTH CARE

BY MAYA KAUFMAN

illions of dollars that New York won as part of a nationwide opioid settlement have been diverted to the state’s general fund rather than going to substance-abuse treatment and prevention efforts, providers and advocates say. New York got more than $32 million as part of a 47-state settlement with consulting giant McKinsey & Co. over its work with companies that fueled the country’s opioid epidemic. The money was meant to “ensure that those responsible for the crisis help to fund prevention, education and treatment programs,” state Attorney General Letitia James said in February, when she announced the agreement.

Meanwhile, the agency’s budget for the 2022 fiscal year is the same as for the previous fiscal year, said state Sen. Pete Harckham. Harckham, who chairs the committee on alcoholism and substance abuse, called the move by Gov. Andrew Cuomo’s budget office a “sleight of hand” in accounting. “The families who have lost loved ones to the opioid crisis are very wounded by this. To them, this is blood money,” he said. “They want to see this money go to see that other families don’t go through this pain they went through.” Freeman Klopott, a spokesman for the state Division of the Budget, pushed back on the characterization. Klopott said the $28 million in settlement money the state will receive this fiscal year is all “dedicated to combating addiction.” The rest will come in three installments of $1.4 million within the next four years. “New York state has fought hard to ensure those who prospered from the opioid crisis pay a price that offsets the costs of combating it,” Klopott said. The state is using $11 million in settlement proceeds to boost medication-assisted treatment in prisons. Almost $1.3 million will go toward syringe-exchange programs and supplies of the drug naloxone to combat overdoses, Klopott said.

“THE FAMILIES WHO HAVE LOST LOVED ONES TO OPIOIDS ARE VERY WOUNDED BY THIS” But local providers of those prevention, education and treatment programs say that is not what happened. Instead, the state effectively padded its general fund for operating costs by using the settlement money to supplant part of the state’s annual spending on the Office of Addiction Services and Supports.

BLOOMBERG

State’s opioid settlement money diverted from substance-abuse services, providers say

The rest, advocates say, is unaccounted for.

‘Moral imperative’ Allegra Schorr, president of the Coalition of Medication Assisted Treatment Providers and Advocates, which includes 45 opioid treatment providers with about 43,000 patients statewide, said the nonprofit has asked that the settlement proceeds fund substance-abuse treatment and prevention services. “This money isn’t being used to fight addiction,” Schorr said. “It’s being used to fix the potholes. There’s a moral imperative here, and that’s not what’s happening.”

Schorr said the money is sorely needed by the underfunded providers helping New Yorkers with opioid-use disorders and other substance-abuse problems. Providers’ overhead costs are going up, especially as the increased popularity of telehealth comes with added technology costs. The Covid-19 pandemic has meanwhile fueled opioid and substance abuse, according to experts. Drug-overdose deaths have spiked during the pandemic, driven by synthetic opioids, according to the U.S. Centers for Disease Control and Prevention. New York saw its number of overdose deaths increase 27% in Sep-

tember compared with September 2019, according to the CDC—likely an underestimate due to incomplete data. That has put pressure on behavioral health providers that help people experiencing substance abuse, Harckham said. “The capacity of our providers has really been stretched to the max during the pandemic,” he said. Harckham is now pushing for state legislation that would direct future proceeds from opioid settlements to be used only for addiction treatment, recovery and prevention. It would also establish an advisory counsel to oversee what happens to the money. ■

CRAIN’S BUSINESS FORUM

How restaurants plan to operate in a post-pandemic landscape

aniel Boulud, Thomas Keller, Danny Meyer and Melba Wilson are set to sketch out New York City’s hospitality future when they gather May 5 for a Crain's New York Business forum on the restaurant industry in a post-pandemic world. The four restaurateurs are expected to discuss closures, openings and likely permanent shifts in how eateries will function in the post-Covid-19 landscape. Real estate opportunities for retail and shifting government regulations are certain to be on the table as the four grapple with their role in New York’s recovery. “A lot of restaurants closed down that were staples in this city,” said Wilson, who owns Melba’s in Harlem and is president of the New York City Hospitality Alliance. That’s a loss on a number of levels, she said, including the fact that worried New Yorkers couldn’t gather at eateries to support one another. “We all had so much on our chests, and neighborhood restau-

rants are places where people can let their hair down,” she said. Only about 60% of restaurants that use the OpenTable platform for reservations had reopened in the city as of the beginning this month. In part because of steep job losses in hospitality and leisure, the city’s employment recovery lags the rest of the country’s. Half of the jobs in food service disappeared between February 2020 and this past February, according to data from the state Department of Labor.

Drawing comparisons Three of the four restaurateurs have businesses outside the state and can compare the recovery in New York to the situations in Florida, California and the District of Columbia. Some of their businesses closed permanently or temporarily during the crisis, but others are opening. Boulud’s long-planned 11,000square-foot restaurant Le Pavilion at One Vanderbilt is scheduled to open next month, as is Melba’s Mussels, a new spot from Wilson. Those openings might spark a

NEW YORK CITY’S RESTAURANT REVIVAL Join Crain’s as we examine which establishments have been hit the hardest, how businesses are evolving and what eateries are doing to bring back diners. Attendees will learn what steps the government, business community and public can take to help local restaurants get back on their feet. Date: May 5 Time: 4 to 5 p.m. Register at CrainsNewYork.com/ webcasts

boom as restaurants seek opportunities in New York’s decimated retail landscape or aim to renegotiate leases for more uncertain times. “Rents were already high when they were based on an expectation of residential, travel and office density,” said Meyer, founder and chief executive of the Union Square Hospitality Group. “There will be a comeuppance.” As they wait for a brighter future,

BOULUD

KELLER

WILSON

MEYER

the restaurateurs say they continue to be inundated by regulations regarding capacity, curfews and outdoor dining, and they’re bothered by often-updated advice that’s not always clearly communicated. Some said the government needs to communicate confidence, rather than fear, to New Yorkers to help potential diners become customers again. “It’s important for a New York–

HELGE KIRCHBERGER, DEBORAH JONES, JEFF WOJTASEK

BY CARA EISENPRESS

centric listener to hear that it’s OK to go out,” said Keller, chef and proprietor of the Thomas Keller Restaurant Group, which owns the popular Per Se. He added that Per Se’s enormous space has always had at least 6 feet of space between tables, making it a place where even the hesitant would be able to feel comfortable. “We were social distancing before that was a thing,” he said. ■

4 | CRAIN’S NEW YORK BUSINESS | APRIL 26, 2021

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What’s happening to our healthcare behind closed doors? NewYork-Presbyterian is currently meeting with Empire BlueCross BlueShield to negotiate a new agreement WHAT WE DON’T KNOW ●

What price increases NewYork-Presbyterian (NYP) is seeking for services.

●

What restrictions NYP is seeking to put on our network.

WHAT WE DO KNOW ●

NewYork-Presbyterian’s prices are already significantly higher than many other major NYC health systems for certain procedures, like knee replacements or giving birth.*

●

Our members, not Empire, will bear the cost of any increases.

●

The new contract could prohibit us from encouraging members to go to high-quality hospitals that charge less than NYP.

●

We developed a high-quality maternity program for our members. That program could be prohibited by the new contract.

The 32BJ Health Fund provides health benefits to more than 100,000 hard-working men and women who provide essential services in commercial and residential buildings throughout the city and who want a say in how their livelihood is spent. When we reached out to NewYork-Presbyterian to discuss the matter—they refused to discuss any aspect of the agreement with us.

WE CALL ON NEW YORK ELECTED OFFICIALS TO DO THE FOLLOWING: ●

Hold public hearings where insurance and hospital officials can answer our questions regarding the high cost of care at their facilities.

●

Prohibit hospitals and insurance companies from agreeing to anti-competitive clauses that restrict our ability to innovate high-quality solutions for our members.

●

Establish reasonable hospital costs for NY consumers pegged to Medicare standards.

This contract will not just affect our members, but also billions of tax dollars spent on hospital care for New York public sector workers. It’s too important to be done behind closed doors. * Based on 32BJ Health Fund claims data.

Building Service 32BJ Health Fund

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IN THE MARKETS

Real estate lender Signature Bank enjoys huge rally as troublesome signs build

“WE HAVE QUITE A BIT OF COMMERCIAL REAL ESTATE. WE’RE VERY BULLISH ON MANHATTAN” although its outlook is “uncertain.”

Strong deposit growth DEPAOLO

PATRICK MCMULLAN

ignature Bank’s fortunes are mercial-property and apartment tethered to two of the world’s loans account for more than half of most uncertain assets: New its $50 billion portfolio. Last Wednesday the bank reportYork City real estate and cryptocurrencies. For now it’s a fun ed that Covid-related loan modifiride. cations rose last quarter to 7.1% of Signature reported last Wednes- its loan book, from 6.6% in the fourth quarter. day what Chief Executive “That number jumps Joseph DePaolo deout,” said Steve Moss, an scribed on a conference analyst at B. Riley Financall as an “unbelievable quarter,” with record cial. earnings and deposit Signature defines modgrowth. The bank was one ified loans as those where of the few whose loan interest is being paid but book grew significantly not principal, and it last quarter. doesn’t classify them as “The bank is firing on deferred. It didn’t explain AARON ELSTEIN all cylinders,” said Dewhy loan modifications increased last quarter Paolo, who has built the institution he co-founded 20 years even as the city slowly reopened. ago into a significant business lend- The bank didn’t reply to requests for comment. er with $80 billion in assets. Its stock price jumped by 12% on the earnings news and has nearly Struggling borrowers tripled in value in the past 12 Modified loans aren’t doomed to months, a performance unmatched go bust necessarily, but clearly by any big bank. Board members more Signature borrowers are include former Rep. Barney Frank struggling as the pandemic grinds and former Sen. Alfonse D’Amato. on. At the end of last year, the bank But there are signs of trouble held $3 billion worth of loans rated ahead for Signature, where com- “special mention” or “substan-

dard,” a big change from $1 billion worth as of Sept. 30. (“Special mention” is a regulatory term for potentially troublesome loans requiring close attention.)

“We have quite a bit of commercial real estate in Manhattan. That’s one thing we have that others don’t,” DePaolo said on the call. “We’re very bullish on Manhattan”

One reason investors might be overlooking all that uncertainty is Signature is involved in the scorching-hot cryptocurrency market. Last week Circle, a financial-technology company, said Signature would hold billions in deposits related to USD Coin, which it described as “the fastest-growing digital dollar in the world.” Forbes included the bank on its recent Blockchain 50 list. It helps explain why deposit growth at Signature is so strong. Cryptocurrencies are notoriously unstable, of course. In the next market downdraft, that money could leave the bank in a flash. ■

POLITICS

Democratic candidates to spar over the issues at Crain’s May 11 mayoral debate BY BRIAN PASCUS

emocratic candidates for New York City mayor are set to duke it out over their qualifications to lead the Big Apple’s comeback during the Crain’s New York Business Democratic primary debate May 11. Development, the economy, the tourist industry and plans for a recovery from the Covid-19 pandemic will be on the table as six leading contenders meet during the 90-minute forum. City Comptroller Scott Stringer, Brooklyn Borough President Eric Adams, former Citigroup executive Ray McGuire, former MSNBC commentator Maya Wiley, former Sanitation Commissioner Kathryn Garcia and former federal Housing Secretary Shaun Donovan are expected to weigh in on the issues. “My hunch is business folks want to see a new partnership with City Hall that doesn’t punish them for making money and someone who will take their agenda as they define it to Albany,” said Hank Sheinkopf, a longtime political consultant. “They need an advocate to work with them in Albany.” No candidate has staked his claim closer to the business community than McGuire, who has nearly 40 years of corporate experi-

ence as an investment banker. McGuire said he believes there must be a truce between big business and the city. The recent tax increases will only harm companies that want to keep their footprint in the Big Apple, he said. “There’s no need to continue to have this narrative on taxes,” McGuire said. “It’s not constructive. It’s divisive and alienating, and today we’ve become one of the biggest advertisers for Texas and Florida.”

Moderate contenders Adams, a former New York Police Department captain, is looking to leverage his vast union support with a tech-centered platform designed to help the business community invest in New York. His vision includes green jobs, biotechnology and cybersecurity. “Adams seems more pro-business and less punitive to small business and more thoughtful about crime overall,” remarked Sheinkopf, who said he considers Adams a moderate. “We know crime tends to be a force for destruction for the city’s economy over time.” The other moderates, in Sheinkopf’s eyes, are Donovan and Garcia, who have argued that they understand the city because of their work at its agencies. Donovan spent time as former

ADAMS

DONOVAN

Mayor Michael Bloomberg’s Housing Preservation and Development commissioner before joining the Obama administration as HUD secretary for eight years. Garcia earned a reputation as Mayor Bill de Blasio’s utility player, heading the Sanitation Department and the Department of Environmental Protection and becoming interim chairwoman of the New York City Housing Authority. “I think in Kathryn’s case, she was the go-to person for every crisis in this administration,” political consultant George Arzt said. “Shaun has wrapped himself around [Barack] Obama.” Donovan’s 200-page plan for the city looks to leverage technology to streamline government and use public-private partnerships to create jobs and reduce income inequality. Garcia is focused on small businesses. She wants a single city permit to reduce red tape and to create

GARCIA

MCGUIRE

TOP CONTENDERS FROM THE DEMOCRATIC PRIMARY Crain’s New York Business will host a series of mayoral debates, where candidates will have the opportunity to speak on key issues affecting the city. The first event in the series will feature top contenders in the Democratic primary as they address the economy, health and safety, their vision for New York City, quality-oflife concerns and a variety of other pertinent topics. VIRTUAL EVENT Date: May 11 Time: 3:30 to 5 p.m. CrainsNewYork.com/MayDebate

a crowdsourcing platform that can raise money and deliver microloans. Donovan and Garcia have struggled to break through with the public, according to recent polls. Some

STRINGER

WILEY

experts point to their lack of experience as candidates for elected office, especially in a crowded field with others who’ve previously been tested at the ballot box.

Union support Another candidate new to the city’s electoral map is Wiley, who formerly served as de Blasio’s chief counsel. Wiley has hoped her alignment with social-justice causes and progressive policies will create a primary path forward in the election, which for the first time will employ ranked-choice voting. Although she received the support of powerful labor union SEIU 1199, Stringer has stymied Wiley’s path to the heart of progressives. Stringer has scooped up endorsements from the Working Families Party and NY Communities for Change, as well as the powerful, 200,000-member United Federation of Teachers. ■

6 | CRAIN’S NEW YORK BUSINESS | APRIL 26, 2021

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REAL ESTATE

Judge lifts restraining order on Gowanus rezoning BY EDDIE SMALL

Jason Zakai, attorney for the community groups, stressed the importance of these conditions in his statement on the judge’s ruling. “The judge’s order today is provisional and is contingent upon the city meeting certain requirements, which it has not yet done,” he said. “The court proceeding continues, and Voice of Gowanus will not waver in its fight on behalf of the community to ensure there is increased public participation, access and transparency at any ULURP public hearings on the massive and controversial Gowanus rezoning plan.”

Kicking the can Critics of the lawsuit argued that it was just an attempt to push back the rezoning until the next mayoral administration, and the city filed a motion in mid-March to dismiss the lawsuit, arguing that a new executive order from Mayor Bill de Blasio suspending in-person hearing requirements for the uniform land-use review process during the

Held up GETTY IMAGES

he city may move forward with its Gowanus rezoning, a Brooklyn judge ruled last Monday. Judge Katherine Levine of state Supreme Court has lifted the temporary restraining order that had kept the rezoning on hold for months following a lawsuit from community groups Voice of Gowanus and Friends and Residents of Greater Gowanus. The groups had argued that holding virtual public hearings instead of in-person ones for the rezoning was against the law. Levine had expressed skepticism of the community groups’ arguments at two hearings on the case, in January and February, but she declined both times to fully lift the restraining order.

Covid-19 pandemic nullified the groups’ arguments. The project likely will be certified shortly, and the Department of City Planning announced April 16 that it was putting the Gowanus plan on its agenda in anticipation of the ruling. “The proposed Gowanus Neighborhood Plan will be presented to the City Planning Commission to

begin the city’s public land-use review process today,” said DCP spokeswoman Melissa Grace. “We are grateful for the ongoing attention to this case by Justice Levine, and we will continue to work with the court and the community to ensure that the plan, which has been in the making for many years, is widely reviewed.” The restraining order was lifted

on the condition that the city and community groups submit a more detailed proposal within three days to memorialize the conditions under which Levine lifted the restraining order. They also were expected to submit a plan within a week describing how they would conduct a hybrid Zoom and outdoor hearing for the rezoning, according to court papers.

The city’s plan calls for more than 8,000 apartments, more than 3,000 of which will be affordable units, along with new public open spaces and investments in infrastructure and resiliency, according to DCP. Kenneth Fisher, an attorney who argued on behalf of a pro-ULURP community group, was happy with the judge’s decision. “The effort to prevent public participation in the guise of increasing public participation has failed,” he said. “The judge properly concluded that she could not block a virtual hearing and that she couldn’t hold the process up any longer.” ■

APRIL 26, 2021 | CRAIN’S NEW YORK BUSINESS | 7

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

EDITORIAL

publisher/executive editor

Racial audits allow companies to overcome their past mistakes

Frederick P. Gabriel Jr. EDITORIAL editor Robert Hordt assistant managing editors Telisha Bryan,

Janon Fisher

deputy digital editor, audience & analytics

INTERNET

SWEEPING

Jennifer Samuels associate editor Lizeth Beltran art director Carolyn McClain photographer Buck Ennis data editor Amanda Glodowski senior reporters Cara Eisenpress,

Aaron Elstein, Eddie Small reporters Ryan Deffenbaugh, Maya Kaufman,

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

www.crainsnewyork.com/staff GETTY IMAGES

with being called out for missteps. But as the old adage goes, those who fail to learn from the past are doomed to repeat it. The best way to root out injustice is to learn which habits contribute to it in the first place. Discriminatory lending practices, for example, can be overturned only by acknowledging and addressing them. Firms should have to justify the motive behind their actions so they can decide if they’re comfortable continuing to treat their customers and the community that way. Plus, if companies are honestly committed to change and equity, that requires taking a good, hard look at the old guard and the old way of doing things. Discriminatory practices don’t just happen. Employees IN THE ERA, THERE IS implement them. Corporate culture SUCH THING AS begins at the top, and unless SOMETHING UNDER THE RUG firms recognize that and shake things up, everyAmericans with statements and thing will eventually revert to donations, firms including business as usual. Welcoming in Johnson & Johnson, Goldman new blood and new practices is Sachs and Wells Fargo are now the only way to effect real change. asking their shareholders to vote Sure, it looks good for a firm to say against such audit proposals. that it will make an effort to hire We get it: No company wants more Black executives. But only the bad press that comes along

ou can’t figure out where you’re going unless you know where you’ve been. So it was welcome news earlier this month when global money manager BlackRock announced that it will subject itself to a racial audit, as requested by a shareholder. The effort is meant to pin down whether the company has contributed to injustice in the financial system. Requests for racial audits have gained steam in the wake of the civil rights movement of last summer, largely spurred on by the murder of George Floyd in Minnesota. And although many companies publicly pledged their support for the rights of all

consumers and shareholders that firms are committed to doing the hard work. Part of that work includes accounting for the times they got it wrong. It will be uncomfortable and possibly embarrassing, but it will highlight that a company truly wants to be a good community steward, rather than an entity that throws money or milquetoast statements at important issues. The only way to do better in the future is to learn from the past. Taking steps to weed out problematic practices ensures firms aren’t doomed to repeat previous injustices. ■

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Times Square’s deterioration is greatly exaggerated he “bad old days”? Really? The April 19 Crain’s cover story conveys that business owners in Times Square fear that the slippage in quality of life we’ve seen since the pandemic could augur a return to the high-crime nightmare of the 1970s, ’80s and early ’90s. Those of us who remember that New York City cannot forget it, try as we might. Yes, there have been some heinous, high-profile crimes recently. And yes, Times Square and Midtown face challenges as we rebound. But the comparison with past rough periods in New York’s history falls apart under the slightest scrutiny and, in fact, distorts the reality of what we are seeing today in Times Square. Today’s multitude of problems have been magnified by a single crisis, a virus, and as that danger recedes, so too will many of its side

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through understanding who at the top levels of the organization have been keeping the doors closed to minorities will the firm actually be able to commit to diversifying. Here’s a more up-to-date truism: In the internet era, there is no such thing as sweeping something under the rug. Firms that try to hide their mistakes will inevitably be called out by a whistleblower. The ones that hold themselves accountable on their own will fare far better in the realm of public sentiment than the ones that wait to be caught. Racial audits are a sign to

OP-ED

BY ERIC RUDIN AND TOM HARRIS

212.210.0100

effects. The real “bad old days” were quite different. A complex combination of societal factors and decades of poor governance brought that crisis on. So, let’s just take a deep breath before we announce that the end is near. Still, the Times Square Alliance knows we face real quality-of-life challenges that must be addressed.

Shut-down city Some of the perceived problem is optics: Times Square is often in the spotlight. Its oft-photographed spookily empty streets became a symbol of a shut-down city early on during the pandemic. Now, with pedestrians returning in droves, new images will serve as symbols of our city’s comeback. As accurately noted in the same article, “Perhaps no neighborhood is more important to New York’s rebound than Midtown, whose Broadway marquees and brightly lit billboards are what many tourists think of when they picture the

Big Apple.” The Times Square Alliance has focused on solutions to the problems that do exist, as well as strategies to quicken the recovery and combat those overly ominous perceptions: We are working with the mayor and the city’s Covid-19 recovery team to develop solutions including additional police and other city agency resources in Midtown. We need all city agencies to work together with each community to solve problems. We partnered with Breaking Ground, the Center for Court Innovation and Fountain House to bring services to those in need of assistance, and we have seen a decrease in overnight street homeless. We are also in close daily contact with two hotels that are contracted with the city to shelter the homeless. We have called for a deputy mayor of public space. The position would have line authority over the agencies that deal with issues

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

Simone Pryce media services manager Nicole Spell

in the public realm and would hold the agencies accountable for street homelessness, aggressive solicitation, vending issues and other quality-of-life concerns. We are working with neighboring Business Improvement Districts. The high-profile crimes recently reported as being near Times Square actually took place to the south and west of our district; nonetheless, it is important that we take a broad view of our area to ensure that the current administration and future ones recognize the importance of our business districts. We are urging our employers to bring their workers back to the office as quickly and safely as possible now that Covid-19 vaccinations are rolling out faster. Rest assured that Times Square will not sit passively and hope for recovery. We will fight for it. ■

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Eric Rudin is chairman and Tom Harris is acting president of the Times Square Alliance.

8 | CRAIN’S NEW YORK BUSINESS | APRIL 26, 2021

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OP-ED

BY KYLE BRAGG AND HENRY GARRIDO

he pandemic has rightly focused public attention on racial disparities and on the importance of accessible quality health care for all New Yorkers. Unfortunately, health care costs in New York City are among the highest in the country and are now jeopardizing access to care for working people. Some of the most prominent private nonprofit health systems— such as New York–Presbyterian, Northwell Health, Montefiore Medical Center and NYU Langone—are driving up hospital costs and worsening the city’s inequality crisis. The pandemic has only exacerbated existing racial inequalities for food insecurity, housing and, most glaringly, health care. For those working-class New Yorkers who have made it through the Covid-19 crisis with their job and health intact, out-of-control hospital pricing threatens their survival. Due to skyrocketing hospital prices, the total cost for health benefits becomes more expensive each year, leaving less and less money for wage increases to sup-

port these essential workers. There is a common misconception that hospital overcharging comes off the bottom line of insurance companies. For hundreds of thousands of union workers in New York, hospital overcharging comes from their paycheck, one way or another.

Sticker shock Simply put, the prices paid to the large health systems are excessive, out of whack and cannot be justified by any legitimate standard. A study found that city hospitals were paid on average 2.4 times the Medicare rate for the same services between 2016 and 2019. For example, the 32BJ union health fund paid NYU 3.97 times the Medicare rate in 2019; paid New York–Presbyterian 3.58 times what Medicare paid in 2019; and paid Northwell 2.99 times the Medicare rate in 2019. For some services, the cost was even more. For example, for routine outpatient hospital care, like a colonoscopy, the 32BJ fund paid an average of $9,426 in 2018 and 2019 at New York–Presbyterian’s Columbia University Medical Center. The Medicare rate for the same time period for the same care was only

$1,021, meaning that the health fund paid more than nine times the Medicare rate. Between 2016 and 2019, the 32BJ fund paid a total of $1,322,015,900 for hospital services in the city. The equivalent cost for the services, had they been paid for by Medicare, would have been only $550,570,480. Thus, the health fund paid $771,445,420 more than Medicare would have paid for the same services at the same hospitals. How do the major health systems get away with the high prices? They use their market power and public reputation to structure their contracts with third-party administrators to their advantage. They tightly control which hospitals are included in an insurance provider’s network and prohibit the exclusion of hospitals that have out-of-control pricing. While their tactics do not technically constitute a monopoly, the resulting lack of competition has the same effect on pricing. The high cost of health care is also exacerbated by the lack of disclosure by the large hospitals and intermediaries such as Empire BlueCross BlueShield and Emblem—which negotiate agreements with health care providers.

ASSOCIATED PRESS

Out-of-control hospital pricing creates more inequality

The negotiated rates haven’t been disclosed to us, even though federal law says they should be. Demanding full transparency and fair pricing from the city’s hospitals is about more than just health funds. The city, much like the country, has challenges ahead of us as we try to bring the economy back. Bringing down unnecessarily high health care costs could be the key to our recovery and would go a long way toward addressing the rising inequality in our city. When we face budget crises in the coming years, we cannot afford to unnecessarily

waste billions of dollars. Neither working-class New Yorkers nor the city’s taxpayers can afford to continue to be shaken down. We call on New York City to examine out-of-control hospital pricing. The hospitals must prioritize patient care over the relentless pursuit of more profit. ■ Kyle Bragg is the president of 32BJ SEIU, the largest property service workers union in the country. Henry Garrido is executive director of DC 37, New York City’s largest public employee union.

OP-ED

Retirement incentives for city workers are foolhardy BY ANDREW REIN

ew York state has just authorized New York City to offer most civilian employees an incentive to retire early. The city should flatly reject this opportunity. It makes no sense for the city to spend money to save money—especially when up to one-third of the money would go to people who would retire anyway. In addition, the city’s partial hiring freeze is already shrinking the workforce. The early retirement incentive would induce employees to retire by increasing their pension benefits either by crediting them with extra years worked or eliminating the pension reduction usually taken when an employee retires before they are 55 years old with 25 years of service. On average, the retirement incentive would cost the city $110,000 for every person who takes it. That totals $110 million for every 1,000 employees, which would be spread over four years. Importantly, the city would likely give the incentive to employees who would retire anyway. The Citizens Budget Commission found that in 2010, about one-third of those who elected the state’s early retirement incentive would have retired without it. Some city employees right now are making the very rational decision to delay re-

tirement in case they will be offered an incentive; others will just move retirement up a year or two. Paying people extra for what they would do anyway makes no fiscal sense. Also, there is an alternative strategy to reduce the workforce that literally is …. free! Roughly 20,000 people leave city government employment each year. The city can shrink its workforce by selectively refilling vacancies. Managing attrition like this causes much less pain than laying off staff and costs less than paying them to leave.

Hiring freeze The city’s partial hiring freeze— refilling one or two out of every three vacancies—has shrunk the workforce by 14,860, to 312,250 in February 2021. Fortunately, the substantial infusion of federal aid provides time to significantly slow down any desired further workforce reductions. Assuming a reasonable target workforce size is around 310,000, close to what it was in fiscal year 2016, the city could shrink to this over the next two years by strategically hiring to meet service needs and phase in organizational changes that improve quality and productivity. This will go a long way toward addressing the city’s underlying fiscal challenges that again will emerge when one-time federal aid is depleted.

Admittedly, an early retirement incentive could achieve this 2,250 position reduction more quickly and with better targeting than leveraging attrition. But these small benefits are radically outweighed by the nearly $250 million cost that the city would incur. The retirement payoff is not an alternative to layoffs. Not only are layoffs not planned nor needed, but in exchange for municipal unions agreeing to let the city delay payments to workers and benefit funds by nine months, the de Blasio administration guaranteed no layoffs through June 2022. That’s not a problem since the city will get $5 billion in additional federal aid. The real threat now is that the fiscal relief of the federal fund infusion gives rise to a city rehiring spree. It is not needed and in the long run would be fiscally destabilizing. The city has a fiscal glide path; it should use it. Offering an early retirement incentive when the city can achieve the same goals much cheaper would be foolhardy. Manage services, finances, federal money and the government workforce well and the city will be in a much better position in the future to serve New Yorkers and weather any future shocks. ■

Our top priority is your bottom line. Count on our Construction advisors to help you reach your business goals. grassicpas.com/construction

Andrew Rein is president of the Citizens Budget Commission. APRIL 26, 2021 | CRAIN’S NEW YORK BUSINESS | 9

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PEOPLE ON THE MOVE

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

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Alan Goldenberg, JD, MBA, LL.M, has joined Anchin as the Principal and Leader of the firm’s State and Local Tax (SALT) practice. He brings more than 15 years of experience in accounting and law matters such as representing taxpayers before the IRS, state, and local tax authorities. Alan will provide Anchin’s clients with specialized advice and strategies regarding the complex range of state and local tax laws and compliance requirements.

Digital-native agency, closerlook, inc, has brought on two seasoned agency executives to help manage its growing Geider portfolio of new business. Former CDM president Gregg Geider joins closerlook as VP, managing director. He has overseen more than 30 biotech Spoleti brand launches, led diverse global teams and nurtured client relationships. Julie Spoleti, who served as a senior vice president at Grey and Saatchi & Saatchi Wellness, is now a managing director at closerlook. Spoleti has held leadership positions in strategy and client services, working on the world’s largest brands to the rarest of diseases. Both come to closerlook at a time of explosive growth, guiding client brand campaigns through digital transformations accelerated by the pandemic.

Pernod Ricard North America announced the appointment of Lani Montoya as the Chief Human Resources Officer on its executive team. Montoya has been with Pernod Ricard for 15 years, previously leading Global Talent Management and Diversity & Inclusion. Reporting to Chairman and CEO Ann Mukherjee, Montoya will be responsible for talent acquisition, employee capabilities and retention, diversity & inclusion programming, and furthering the company’s Better Balance cornerstone.

Phillip Theiss is a Vice President and Banker at J.P. Morgan Private Bank in New York City. In this role, Phil works closely with families with legacy assets, business owners, corporate executives and members of the financial community, helping them plan, borrow, bank and invest with intent. With more than a decade of experience, he provides guidance and advice across the entirety of his clients’ balance sheets. Before joining J.P. Morgan, he led a team of wealth advisors at Charles Schwab.

Freshfields Bruckhaus Deringer LLP

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Anchin, Block & Anchin Joseph Molloy, CPA, has joined Anchin as a tax partner and key member of the firm’s Architecture, Engineering and Construction (AEC) Groups. Joseph has 20 years of experience developing tax strategies and preserving capital for construction managers, general contractors, subcontractors, and architecture and engineering firms. Joe will join the growing AEC team’s efforts in customizing tax planning to specific business situations, as well as identifying relief programs to assist local firms.

ANNOUNCE

YOUR BIG NEWS IN CRAIN’S!

Timothy Wilkins, Global Partner for Client Sustainability at the law firm Freshfields Bruckhaus Deringer LLP, has been elected Chair of the Board of Trustees of New York Public Radio, home to WNYC and WQXR. He has been a tireless advocate for more than 20 years on diversity and inclusion issues within the legal, social justice, and New York City non-profit community, and will help bolster NYPR’s mission to provide audiences with trusted news, civil conversation, and the joy of classical music.

FINANCIAL SERVICES

TPC Art Finance FINANCE

J.P. Morgan Paula Root has joined J.P. Morgan Commercial Banking’s Innovation Economy team within the Middle Market Banking and Specialized Industries group. Root has deep consumer sector experience, and brings more than ten years’ experience supporting high-growth, venture backed companies in the New York area. This marks a significant milestone in the firm’s commitment to building a full ecosystem around the fastgrowing innovation economy.

Naomi Baigell has joined TPC Art Finance, a premier specialty lender offering collaborative, art-backed liquidity solutions to the global art community, as Managing Director, responsible for TPC AF’s marketing and communications strategy. Prior to joining TPC AF, Naomi worked as Managing Director of Marketing and Client Relationships at Athena Art Finance and was Senior Vice President and Director of Corporate Art Services at Sotheby’s Auction House.

HOSPITALITY / TOURISM

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Paley Center for Media The Paley Center for Media has named Paul A. Allen as Vice President, Development. In his new role, Mr. Allen will be responsible for leading all fundraising initiatives including sponsorships, memberships, institutional and individual giving and grants, and will focus on philanthropic fundraising. Mr. Allen comes to the Paley Center from the 9/11 Memorial & Museum, where he most recently held the position of Director, Major Gifts and Grants.

Pelham Country Club CONSTRUCTION CONSTRUCTION

Clune Construction Clune Construction is happy to announce that Edward McCann has been promoted to Vice President, Team Leader. With 22 years of experience in the construction industry, McCann started his career as a superintendent and later transitioned into project management. In his role at Clune, he has managed projects in some of New York’s most iconic buildings, including the recent renovation of 200 Park Avenue. McCann has a Bachelor of Arts in Environmental Studies from City University of New York (CUNY).

Clune Construction Clune Construction has named Greg O’Neill to Vice President, Regional Comptroller, New York, overseeing financials for all New York projects. He has been in the construction industry in an accounting capacity for 10 years. O’Neill has been integral to the improvement of Clune’s systems and operating procedures. He is also well respected among the New York area’s subcontractor community. O’Neill has a Bachelor of Science degree in Business and Finance, and an MBA from Quinnipiac University.

FINANCE

Popular Bank Popular Bank, a subsidiary of Popular, Inc. (NASDAQ: BPOP) has appointed Litao Mai to the role of Executive Financial Consultant with Popular Investments and a Registered Representative of Infinex Investments, Inc., serving clients in New Jersey. Ms. Mai is a Certified Financial Planner (CFP®) and Chartered Retirement Planning Counselor (CRPC®) with more than 16 years of experience in meeting diverse client needs in the areas of investments, retirement planning, and trust and estate planning.

Pelham Country Club in Westchester announces Gary Merjian as the new General Manager & COO, who will enhance member experiences through reimagining the F&B programing and overall club amenities. Gary comes from The St. Regis Hotel in New York where he served on the Executive Committee and as the Director, Catering/F&B/ Event Management for over two decades. While at The St. Regis, Merjian volunteered as President & VP of Operations of the New Canaan Field Club Inc. Merjian also served as the Assistant Director of Catering at the Waldorf Astoria New York for nearly 15 years.

NONPROFIT

STRIVE STRIVE, a leading national nonprofit workforce development organization, hires Tasha Jackson as Chief Financial & Administrative Officer. Ms. Jackson will provide strategic financial and operational leadership and set up systems for growth across internal teams and locations. Ms. Jackson has over fifteen years of executive level experience working at nonprofit organizations and has held leadership roles in finance and accounting at the Urban Resource Institute and Girl Scouts of Connecticut.

10 | CRAIN’S NEW YORK BUSINESS | APRIL 26, 2021

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ASKED & ANSWERED Riverside Park Conservancy

WHO HE IS President and CEO of the Riverside Park Conservancy and a former city councilman

INTERVIEW BY EDDIE SMALL

AGE 48

an Garodnick is president and CEO of the Riverside Park Conservancy, a position he took shortly after serving three terms representing District 4, including the Upper East Side and Stuyvesant Town, on the New York City Council. He focuses mainly on spearheading improvements to the park in his role at the conservancy and thinks the pandemic could spark changes in the often-contentious relationship between the city’s politicians and developers.

GREW UP Stuyvesant Town, the Lower East Side

What is your job at the Riverside Park Conservancy?

ON THE RUN He has done about a dozen halfmarathons, along with the New York City marathon in 2015. He considers being able to finish it a victory.

There are areas of the park that have seen insufficient investments. The city’s capital process for infrastructure improvements takes far too long, and it’s my role to find ways to speed things up. We’ve been doing a lot of private fundraising to make improvements in the park. We are getting them done quickly and are proud of that.

Do you think the City Council has become more hostile to development than when you were a member? I think that there is a strong anti-development feeling among the political class in New York City. Some of it is deserved, some not. The city’s uniform land-use review procedure is much more fraught and challenging in this political environment. It’s definitely broken, and it should be the focus of the next administration and council. Nobody comes away from ULURP feeling like it was a

RESIDES The Upper West Side EDUCATION Bachelor’s in government, Dartmouth College; J.D., University of Pennsylvania FAMILY LIFE Garodnick is married with two boys, ages 7 and 10. GOOD EATS Garodnick’s favorite city restaurants are Frank’s Trattoria, an Italian joint on the border of Stuy Town, and Peking Duck House, a Chinese spot with locations in Midtown and Chinatown.

POLITICAL PERSUASION Garodnick might not be done with his political career just yet. He told Crain’s he has not ruled out pursuing another elected office. NEW AUTHOR He recently wrote the book Saving Stuyvesant Town about Metlife’s controversial 2006 sale of the development to BlackRock and Tishman Speyer.

good and healthy experience. Developers don’t like it, community boards don’t like it, and council members don’t particularly like it either.

Difficult economic times are moments when you will see more collaboration between the political class and the real estate industry by way of necessity. There are vacant office spaces, which everyone wants to see filled one way or another, and everyone is best served when the local economy is thriving. We are up for some real challenges that are going to require partnerships that may not otherwise be obvious.

Do you have any predictions for the city’s 2021 elections?

It will be chaotic with so much turnover: nearly all of the City Council, plus most borough presidents, the comptroller and mayor. That is a lot of new blood at a moment when the city will be in a vulnerable position. I’m concerned about that. There is a learning curve associated with these positions, and what feels easy in a campaign is not so easy when faced with the difficult choices of lawmaking and budget approving and oversight.

You recently wrote a book about the 2006 sale of Stuyvesant Town. Why now?

Stuyvesant Town is one of the last bastions of middle-class housing in New York City, and it deserves the attention of city and state policymakers. This is an important story about how a group of residents came together against real estate interests to preserve a middle-class community. The perspective of the community itself was significantly overlooked in most stories about the debacle. ■

BUCK ENNIS

DAN GARODNICK

Has the pandemic changed how politicians work with the real estate industry?

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STATE OF HOSPITAL CARE

BY MAYA KAUFMAN

n 2019 Hackensack Meridian Health’s former co-CEO, John Lloyd, was awarded $9.9 million in total compensation, making him the metropolitan area’s top-paid hospital executive that year, according to a Crain’s analysis of the most recent financial information available. His haul, of course, predates the pandemic, during the height of which hospital professionals took pay cuts and accepted smaller bonuses in order to keep their facili-

Solutions, a health care management consultancy, about the role of health system leaders. “I would assume the upward trajectories over the years to continue.” Tom Bailey and Matt Leach, principals and senior consultants with Total Compensation Solutions, a New York–based management consulting firm, said institutions enacted pay freezes and temporary cuts in April 2020. Hospitals planned to give executives smaller bonuses for not hitting topline revenue goals and to avoid bad optics. Payouts of incentive plans were similarly limited. By the fall, most had been reversed. Going forward, experts say, bonuses will be increasingly tied to the patient population’s overall health rather than the services provided. That shift was underway even before Covid-19, but the pandemic accelerated it, Miller said. That does not necessarily mean smaller bonuses will be doled out. Rather, patient health will be just another

“COMING OUT OF COVID, THEIR JOB’S GOTTEN HARDER, NOT EASIER” ties’ bottom lines in balance. But experts say that belt-tightening was likely a temporary blip, not a bellwether, for the area’s hospitals and health systems. “Coming out of Covid, their job’s gotten harder, not easier,” said Allen Miller, CEO of Cope Health

HACKENSACK MERIDIAN HEALTH

Pandemic will have little impact on future of hospital pay, experts predict

LLOYD

of many performance metrics, Leach and Bailey said.

Soaring salaries Before Covid-19 took its toll on the nation and the economy, the area’s top-paid hospital executives and physicians reported millions of dollars a year in compensation. Hackensack Meridian’s Lloyd retired at the end of 2018. The $9.9 million he received in 2019 was

place him second on the list. Miriam Laugesen, associate professor of health policy and management at Columbia University’s Mailman School of Public Health and author of the 2016 book Fixing Medical Prices: How Physicians Are Paid, said the pandemic may not do much to shift physician earnings. And gender could continue to play a role. Laugesen said compensation data has shown that male physicians in the same specialty earn more than women, even after controlling for hours worked and other factors.

largely made up of his supplemental executive retirement plan, said company spokesman Ben Goldstein. His SERP was nearly $7.5 million. The New Jersey health network, which includes 17 hospitals, uses a national executive compensation consulting firm to determine the sums, Goldstein said. “The compensation of our most senior executives is aligned with performance and industry standards,” Goldstein said. Lloyd was among nine hospital executives and five doctors who took home more than $5 million in 2019, a Crain’s analysis found. Executives and doctors needed to earn more than $2.3 million to make it onto the lists. On the physician side, Dr. Joseph Levine, St. Francis Hospital’s chief of electrophysiology, held on to his spot as the top-paid hospital doctor with nearly $7 million in compensation in 2019. Dr. Sheeraz Qureshi, an orthopedic surgeon at Hospital for Special Surgery, followed with $6.1 million, slightly less than his 2018 compensation but still enough to

Better off Emerging from the pandemic, some providers could find themselves better off. Although surgeries and other planned procedures were temporarily suspended, Laugesen said, the shift to telemedicine enabled many physicians to see more patients and have fewer cancellations. Experts theorize that the use of telemedicine will remain popular, even as patients return to fully feeling comfortable scheduling in-person doctor visits. ■

STATISTICS

NUMBER of cardiology specialists on the doctors ranking

$3.78M

LARGEST LEAPS

CORWIN

$308K

AVERAGE AMOUNT of other compensation, such as deferred pay and health care benefits, by the 70 doctors and executives on the lists

SAFYER

BUCK ENNIS

Two executives earned raises exceeding $1M in 2019. John Lloyd’s multimillion dollar bump was driven by a retirement payout totaling more than six million dollars.

$3.0M

AVERAGE salary of top executives

AVERAGE salary of top doctors

TOP SYSTEMS Northwell Health had the most executives and doctors on Crain’s list for the second year running, as Catholic Health Services of Long Island and Hospital for Special Surgery tied for second place. NYU Langone fell from the No. 2 slot to No. 4. Total number of execs/doctors

NORTHWELL HEALTH

15 CATHOLIC HEALTH SERVICES OF LONG ISLAND 7 HOSPITAL FOR SPECIAL SURGERY

SOURCE: Crain’s analysis of 2018 and 2019 Form 990 tax filings

7 NYU LANGONE HEALTH SYSTEM

EXECUTIVES John Lloyd (No. 1)

+$6.4M

Brian Gragnolati (No. 15)

Steven Corwin, M.D. (No. 2)

Steven Safyer, M.D. (No. 3)

Barry Ostrowsky (No. 7)

Neil Tanna, M.D. (No. 13)

Varinder Singh, M.D. (No. 15)

Frank Schwab, M.D. (No. 8)

Joseph Levine, M.D. (No. 1)

+$1M

+$.9M

+$.7M

+$.5M

Bryan Kelly, M.D. (No.4)

+$.7M

+$.4M

+$.2M

NOTE: Raise rankings omit one executive and seven doctors for whom comparable 2018 cash compensation is not available. SOURCE: Crain’s analysis of 2018 and 2019 Form 990 tax filings

BUCK ENNIS

DOCTORS

WANT MORE OF CRAIN’S EXCLUSIVE DATA? VISIT CRAINSNEWYORK.COM/LISTS. 12 | CRAIN’S NEW YORK BUSINESS | APRIL 26, 2021

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THE LIST TOP-PAID HOSPITAL EXECUTIVES AND DOCTORS Ranked by 2019 cash compensation

TOP-PAID EXECUTIVES

TOP-PAID DOCTORS TOTAL CASH COMP. FROM ORG./FROM RELATED ORGS.

OTHER COMP.

RANK

NAME/TITLE

HOSPITAL/SYSTEM

1 2 3 4 5 6 7 8

John Lloyd1 Chief executive

Hackensack Meridian Health

$9,888,764 $9,888,764/$0

Steven Corwin, M.D.2 President, chief executive

New York-Presbyterian Hospital

$9,163,395 $9,163,395/$0

$3,250,900

Steven Safyer, M.D.3 Chief executive

Montefiore Health System

$8,635,569 $0/$8,635,569

$8,197,338

Philip Ozuah, M.D./Ph.D.4 President, chief executive

Montefiore Health System

$7,058,335 $0/$7,058,335

$43,570

Kenneth Davis, M.D. Chief executive

Mount Sinai Hospital

$5,589,093 $671,250/$4,917,843

$69,336

Craig Thompson, M.D. President, chief executive

Memorial Sloan Kettering

$5,507,075 $5,507,075/$0

$245,034

Barry Ostrowsky President, chief executive

RWJBarnabas Health

$5,462,183 $5,462,183/$0

$42,560

Milton Anderson Executive vice president, chief academic officer

RWJBarnabas Health

$5,441,828 $5,441,828/$0

$3,937

Laura Forese5 Executive vice president, chief operating officer

New York-Presbyterian Hospital

$4,972,422 $4,972,422/$0

$314,023

10 11 12 13 14 15 16 17 18

Robert Garrett6 Chief executive

Hackensack Meridian Health

$4,155,462 $4,155,462/$0

$334,348

Michael Dowling President, chief executive

Northwell Health

$3,965,552 $3,965,552/$0

$59,178

Thomas Biga President

RWJBarnabas Health

$3,704,036 $3,704,036/$0

$42,925

Louis Shapiro President, chief executive

Hospital for Special Surgery

$3,680,143 $2,944,114/$736,029

$84,220

Lynn Richmond7 Executive vice president

Montefiore Health System

$3,618,743 $0/$3,618,743

$40,261

Brian Gragnolati8 President, chief executive

Atlantic Health System

$3,595,302 $3,595,302/$0

$663,780

Robert Grossman, M.D.9 Dean, chief executive

NYU Lagone Health System

$3,425,126 $1,712,563/$1,712,563

$2,554,214

Robert Glenning10 Chief financial officer

Hackensack Meridian Health

$3,307,926 $3,307,926/$0

$45,167

Mark Solazzo Executive vice president, chief operating officer

Northwell Health

$2,898,072 $2,898,072/$0

$52,073

19 20

John Collins11 President, chief executive

NYU Winthrop Hospital

$2,653,229 $2,653,229/$0

Amy Mansue Executive vice president, chief experience officer

RWJBarnabas Health

$2,514,495 $2,514,495/$0

$28,196

21 22

Susan Fox12 President, chief executive

White Plains Medical Center

$2,504,070 $2,504,070/$0

$325,036

Alan Guerci, M.D.13 President, chief executive

Catholic Health Services of Long Island

$2,421,964 $2,421,964/$0

$388,984

23 24

Maxine Frank14 Special advisor

New York-Presbyterian Hospital

$2,405,480 $0/$2,405,480

$241,518

Robert Cerfolio, M.D.15 Senior vice president, chief of hospital operations

NYU Lagone Health System

$2,298,038 $1,798,674/$499,364

$397,513

John Bonamo, M.D., M.S. Executive vice president, chief medical and quality officer

RWJBarnabas Health

$2,245,134 $2,245,134/$0

$42,775

Joseph Lemaire16 President, diversified health ventures

Hackensack Meridian Health

27 28 29

Michael Burke Chief financial officer

NYU Lagone Health System

Ihor Sawczuk, M.D.17 President

$2,228,329 $2,228,329/$0

$44,127

$2,213,048 $1,106,524/$1,106,524

$33,672

Hackensack Meridian Health

$2,210,451 $2,210,451/$0

$93,053

Susan Green-Lorenzen, R.N.18 System senior vice president, operations

Montefiore Health System

$2,209,892 $0/$2,209,892

$44,220

Miguel Fuentes19 President, chief executive

Bronxcare Health System

$2,131,012 $2,131,012/$0

$57,683

TOTAL CASH COMP. FROM ORG. /FROM RELATED ORGS.

OTHER COMP.

St. Francis Hospital

$6,992,643 $6,992,643/$0

$49,511

Sheeraz Qureshi, M.D. Associate attending physician

Hospital for Special Surgery

$6,122,573 $6,122,573/$0

$57,008

Richard Shlofmitz, M.D. Chairman, cardiology

St. Francis Hospital

$5,763,984 $5,763,984/$0

$48,053

Bryan Kelly, M.D. Member/surgeon-in-chief

Hospital for Special Surgery

$5,267,261 $5,267,261/$0

$77,214

Samin Sharma, M.D. Professor, cardiology

Mount Sinai Hospital

$5,087,562 $1,084,866/$4,002,696

$42,637

Robert Michler, M.D. Chair, surgery/cardiothoracic surgery

Montefiore Health System

$3,869,857 $3,869,857/$0

$46,514

7 8 9

Answorth Allen, M.D. Attending othepedic surgeon

Hospital for Special Surgery

$3,583,093 $3,583,093/$0

$69,284

Frank Schwab, M.D. Othepedic surgeon

Hospital for Special Surgery

$3,506,409 $3,506,409/$0

$63,964

Jacob Shani, M.D. Chair, heart and vascular center

Maimonides Medical Center

$3,498,724 $3,498,724/$0

$39,023

10 11 12 13

Jessica Jacob, M.D. Physician

North Shore University Hospital

$3,255,887 $3,255,887/$0

$64,254

Eugene Krauss, M.D. Director, orthopedics

North Shore University Hospital

$3,020,562 $3,020,562/$0

$53,335

Lyle Leipziger, M.D. Chief, reconstructive surgery

Long Island Jewish Medical Center

$3,011,626 $3,011,626 /$0

$53,335

Neil Tanna, M.D. Associate program director of plastic surgery and medical director

Long Island Jewish Medical Center

$2,894,948 $2,894,948/$0

$64,254

Mark Smith, M.D. Vice president, surgical service line

Long Island Jewish Medical Center

$2,700,852 $2,700,852/$0

$64,303

Varinde Singh, M.D. Chair, cardiovascular medicine

Lenox Hill Hospital

$2,693,084 $2,693,084/$0

$64,303

Peter Costantino, M.D. Executive director, head and neck

Lenox Hill Hospital

$2,653,328 $2,653,328/$0

$64,303

17 18

William Ricci, M.D. Chief, orthopedic trauma

Hospital for Special Surgery

$2,617,495 $2,617,495/$0

$59,841

Angelo Reppucci, M.D. Director, otolaryngology and facial plastics center

Long Island Jewish Medical Center

$2,575,816 $2,575,816/$0

$64,303

Alan Hartman, M.D. Chair, cardiovascular and thoracic surgery

North Shore University Hospital

$2,575,432 $2,575,432/$0

$64,303

George Petrossian, M.D. Director, interventional cardiovscular procedures

St. Francis Hospital

$2,529,555 $2,529,555/$0

$58,643

21 22 23 24 25 26 27 28 29 30

David Jones, M.D. Chief attending, surgery

Memorial Sloan Kettering

$2,524,616 $2,524,616/$0

$75,581

Babak Mehrara, M.D. Chief attending - surgery

Memorial Sloan Kettering

$2,484,400 $2,484,400/$0

$70,380

Ernest Sink, M.D. Associate attending physician

Hospital for Special Surgery

$2,401,456 $2,401,456/$0

$63,964

Jeffrey Drebin, M.D. Chairman attending, surgery

Memorial Sloan Kettering

$2,382,176 $2,382,176/$0

$72,713

Pankaj Singhal, M.D. Physician

Catholic Health Services of Long Island

$2,321,489 $2,321,489/$0

$66,051

Morgan Chen, M.D. Physician

Catholic Health Services of Long Island

$2,276,840 $2,276,840/$0

$49,902

Sathish Subbaiah, M.D. Physician

Catholic Health Services of Long Island

$2,276,840 $2,276,840/$0

$49,901

David Langer, M.D. Chair neurosurgery

Lenox Hill Hospital

$2,260,461 $2,260,461/$0

$64,303

Stuart M. Zweibel, M.D. Physician, dermatology

White Plains Medical Center

$2,257,828 $2,257,828/$0

$37,073

Samuel Scheinerman, M.D. Chairman, department of cardiovascular and thoranic surgery

Lenox Hill Hospital

$2,243,418 $2,243,418/$0

$53,335

RANK

NAME/TITLE

HOSPITAL/SYSTEM

1 2 3 4 5 6

Joseph Levine, M.D. Chief, electrophysiology

APRIL 26, 2021 | CRAIN’S NEW YORK BUSINESS | 13

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THE LIST TOP-PAID HOSPITAL EXECUTIVES AND DOCTORS TOP-PAID EXECUTIVES

TOP-PAID DOCTORS TOTAL CASH COMP. FROM ORG./FROM RELATED ORGS.

OTHER COMP.

New York-Presbyterian Hospital

$2,113,567 $2,113,567/$0

$64,581

Herbert Pardes, M.D.20 Executive vice chairman

New York-Presbyterian Hospital

$2,095,517 $2,095,517/$0

$74,706

Dennis Charney, M.D. President, academic affairs

Mount Sinai Hospital

$2,091,860 $251,232 /$1,840,628

$46,898

Kathryn Martin Chief operating officer

Memorial Sloan Kettering

$2,085,542 $2,085,542/$0

$557,904

Dov Schwartzben21 Senior vice president, finance

New York-Presbyterian Hospital

$2,067,307 $2,067,307/$0

$113,470

RANK

NAME/TITLE

HOSPITAL/SYSTEM

31 32 33 34 35

William Lee Chief investment officer

TOTAL CASH COMP. FROM ORG. /FROM RELATED ORGS.

OTHER COMP.

Montefiore Health System

$2,189,959 $2,189,959/$0

$41,832

Omid Rahmani, M.D. Chief, vascular surgery

Long Island Jewish Medical Center

$2,169,431 $2,169,431/$0

$52,208

Nirav Patel, M.D. Vice chairperson, cardiothoracic surgery

Lenox Hill Hospital

$2,148,151 $2,148,151/$0

$64,303

Scott L. Schubach, M.D. Chairman

NYU Winthrop Hospital

$2,123,607 $2,123,607/$0

Joseph Disa, M.D. Attending plastic surgery

Memorial Sloan Kettering

$2,099,641 $2,099,641/$0

$78,305

RANK

NAME/TITLE

HOSPITAL/SYSTEM

31 32 33

Emad Eskandar, M.D. Chair, neurological surgery

34 35

SOURCE: 2019 Forms 990 of New York area hospitals and health systems. Area includes the cityís five boroughs plus Nassau, Suffolk and Westchester counties in New York and Bergen, Essex, Hudson and Union counties in New Jersey. Research by Chuck Soder, Darleen White and Amanda Glodowski. Total cash compensation includes base compensation, bonus and incentive compensation and other reportable compensation from the organization and related organizations. Other compensation includes nonreportable compensation, deferred compensation, retirement plan benefits, health care benefits and other fringe benefits from the organization and related organizations. Hospital employee compensation may not include medical school pay. Individuals may have additional titles. SERP-supplemental executive retirement plan. Notes on top-paid executives: 1- Compensation includes a $7,489,229 payment under a SERP retirement plan based on multiple years of service. Lloyd retired at the end of 2018. 2- Compensation includes $1,809,842 reported on the W2 from a supplemental nonqualified retirement plan. 3- Received severance of $8,393,621 from a related organization. $239,156 of this amount was received in 2019 and is reflected in the total. Safyer also received a distribution of $3,797,607 from a pooled SERP plan based on multiple years of service. 4- Compensation includes $1,420,693 pooled SERP distribution based on multiple years of service. 5- Compensation includes a $219,120 participation in a supplemental nonqualified retirement plan, with $618,295 reported on the W2. 6- Compensation includes $715,088 participation in a SERP retirement plan. 7- Compensation includes $2,040,314 pooled SERP distribution based on multiple years of service. 8- Compensation includes $74,902 for insurance policies. 9- Grossman participated in a supplemental nonqualified retirement plan, with an employer contribution of $2,519,839 for 2018. This is reported as a shared cost between NYU Langone and NYU School of Medicine. 10- Compensation includes $337,930 participation in a SERP retirement plan. 11- Compensation includes the payout of full SERP benefits after the completion of a 20-year vesting period. 12- Compensation includes $276,000 participation in a SERP retirement plan. The plan also made its first distribution in 2019 for prior years, amounting to $205,926. 13- Compensation includes a $335,000 participation in a supplemental nonqualified retirement plan. Guerci also has $325,113 vested in the supplemental non-qualified retirement plan. 14-Compensation includes a $174,142 participation in a supplemental nonqualified retirement plan, with $618,295 reported on the W2. 15- Compensation includes $373,291 pooled SERP distribution based on multiple years of service. This is reported as a shared cost between NYU Langone and NYU School of Medicine. 16- Compensation includes $388,575 participation in a SERP retirement plan. 17-Compensation includes $200,896 participation in a SERP retirement plan. 18- Compensation includes $698,175 pooled SERP distribution based on multiple years of service. 19- Fuentes received $77,634 for an annual bonus in 2019. 20- Compensation includes $239,110 from a supplemental nonqualified retirement plan as reported on the W-2. 21- Compensation includes $29,494 from a supplemental nonqualified retirement plan and $321,559 from a supplemental income plan as reported on the W-2.

MEND FROM PAGE 1

came to personal protective equipment and other supplies. “We can’t always run hospitals the way many of us were taught, which is to buy supplies at exactly your census and order meds based on how much you used last month, exactly to the dose,” Katz said. The public health system is now maintaining large supplies of PPE and critical medication, he said. The pandemic also has taught facilities that paying attention to what’s going on in other places and shoring up supplies just in case pays off. For example, when Covid-19 was unfolding in China in December 2019, NYU Langone made the gamble to start buying PPE. “It was an expense, but that made a huge difference in March and April,” Widawsky said, noting that prices for N95 masks increased tenfold during the pandemic’s height. Going forward, the health system will factor the expectation that costs could rise in a crisis into its budget. The pandemic also pushed

Northwell Health to rethink its supply chain. “We had been heavily dependent on China for many of our supplies. But that became an issue when they were hit hard, disrupting our own supplies,” said Michael Dowling, CEO. “Now we’ve expanded our contacts beyond just China.”

Internal investments As local health systems saw their capacity capabilities tested during the patient surges at the height of the pandemic, they learned the importance of investing in infrastructure to meet service demands. Some have explored high-tech solutions. NYU Langone, for example, built a real-time dashboard that can track a patient’s journey from admission to discharge. It has saved the health system hours of data gathering and helped it manage its patient capacity, Widawsky said. The platform was actually created before the Covid-19 crisis began but was adapted to suit the pandemic. Northwell created a daily dashboard that tracked patient capacity at each facility and updated its playbook for transporting patients be-

BUCK ENNIS

WIDAWSKY says NYU Langone stocked up on PPE when it took note of the burgeoning crisis in China.

tween sites safely, Dowling said. New York-Presbyterian used technology to standardize and share medical information across its network, said Dr. Laura Forese, executive vice president and chief operating officer. Last year it adopted a new electronic record-keeping system, although the plan dated back to before the pandemic. It also set up a hotline to provide remote treatment for Covid-19 patients. Others came up with simpler solutions. Health + Hospitals, for instance, made minor fixes such as replacing wooden doors with glass ones to allow for greater patient visibility and placing cameras and microphones at nurses’ stations to improve response time, Katz said. One investment that hospital leaders agree will make all the difference during a future health crisis is in their staff. It’s important for medical workers to receive ample training, and after a year of fighting a devastating virus, their mental health and well-being will need to be addressed as well. Earlier in the pandemic, Maimonides Medical Center offered “hello rounds,” during which attending psychiatrists and senior residents checked on other staff. More recently, the hospital created a webinar on coping with the stress of Covid-19. Maimonides is also training physicians to work across specialties, which they had to do early in the crisis. “We had orthopedists and pediatricians treating virus patients,” said CEO Kenneth Gibbs. “From doctors to nurses, folks needed to be crosstrained.”

Financial kinks Hospitals work on thin margins that are easily threatened by revenue disruptions, making preparing

for future crises all the more difficult. This is compounded by lower reimbursement rates from the government and consumer health insurance plans for certain services and populations. Gibbs noted that reimbursement for services for individuals who are on Medicaid or otherwise in need are too low to allow for adequate care, especially if services need to be ramped up. Health systems that regularly treat a more KATZ says hospitals affluent patient base can’t be run now the way have plenty of resources they always have been. to help them weather tough times, but financTelehealth visits surged to over es will remain shaky for safety-net facilities that rely on public health 7,000 calls per day during the height of the pandemic for NYU Langone, reimbursement, he added. Questions remain on how to cre- Widawsky noted. It has since melate excess capacity for future crises. lowed to about 600 per day. “It is not going anywhere and will “During this major surge, we shut down all our operating rooms be a mainstay of how we deliver and even transformed our hallways health,” he said. But, he added, the to accommodate Covid patients, reimbursement issues have to be but we can’t always do that,” Dowl- ironed out to make the tool truly beneficial for physicians. ing said. Despite the lack of parity, though, It’s not clear whether it’s feasible for health systems to build beds, health systems cannot drag their staff them and leave them empty feet on integrating telehealth into their care models, Dowling said. until another crisis hits. “We can’t afford to sit around “Who’s going to finance that?” Dowling asked, though he noted and say, ‘We can’t do this’ simply that President Joe Biden’s commit- because reimbursement has not ment to upgrading infrastructure caught up,” he said. “We all know telehealth is the future.” might help. As health systems beef up their One way hospitals took in revenue last year as patients stayed readiness for the next crisis, howevhome was through the use of tele- er, the work to improve their operamedicine. But reimbursement rates tions will never be truly done. “Even if we think we’re doing for virtual care are not yet on par with those for in-person services, great, there will be 20 things we can be doing better,” Widawsky said. ■ so some doctors opt not to use it.

BUCK ENNIS

WANT MORE OF CRAIN’S EXCLUSIVE DATA? VISIT CRAINSNEWYORK.COM/LISTS.

14 | CRAIN’S NEW YORK BUSINESS | APRIL 26, 2021

P014_CN_20210426.indd 14

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#1 in the U.S. for heart attack survival. When you work with some of the best doctors in the country, it shows. Get the facts at nycHeart.org

CN020206.indd 1

Maimonides Medical Center

4/20/21 2:53 PM

THE LIST TOP COMMERCIAL OFFICE PROPERTIES Ranked by 2021 rentable building area in Manhattan (office properties only)

RANK

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

COMPANY/ ADDRESS

PHONE/ WEBSITE

TOP LOCAL EXECUTIVE

SL Green Realty Corp. One Vanderbilt Ave. New York, NY 10017

212-594-2700 slgreen.com

Marc Holliday Chairman, chief executive

26.53 1

26.88 1

49 1

Brookfield Properties 250 Vesey St. New York, NY 10281

212-417-7000 brookfieldproperties.com

Ric Clark Chairman Ben Brown Managing partner

24.88

26.73

Vornado Realty Trust 888 Seventh Ave. New York, NY 10019

212-894-7000 vno.com

Steven Roth Chairman, chief executive

23.92

25.26

RXR Realty 75 Rockefeller Plaza New York, NY 10019

212-797-1330 rxrrealty.com

Scott Rechler Chairman, chief executive

16.52 1

Tishman Speyer 45 Rockefeller Plaza New York, NY 10111

212-715-0300 tishmanspeyer.com

Rob Speyer President, chief executive

14.83 1

14.83

17 1

Silverstein Properties Inc. 7 World Trade Center New York, NY 10007

212-490-0666 silversteinproperties.com

Larry A. Silverstein, chairman Marty Burger, chief executive Tal Kerret, president

12.83 1

13.34 1

13 1

The Durst Organization 1 Bryant Park New York, NY 10036

212-257-6600 durst.org

Douglas Durst Chairman Jonathan Durst President

12.03

12.65

GFP Real Estate 125 Park Ave. New York, NY 10017

212-372-2091 gfpre.com

Eric Gural, Brian R. Steinwurtzel Co-chief executives, principals Jeffrey Gural Chairman, principal

10.36 1

10.36

42 1

Rudin Management Co. Inc. 345 Park Ave. New York, NY 10154

212-407-2400 rudin.com

William C. Rudin Co-chairman, chief executive Eric Rudin Co-chairman, president

10.10 1

10.10

Qatar Investment Authority 9 W. 57th St. New York, NY 10019

646-740-5900 qia.qa

Sheikh Abdulla bin Mohammed bin Saud al-Thani Chief executive

9.67

n/d

Paramount Group Inc. 1633 Broadway New York, NY 10019

212-237-3100 paramount-group.com

Albert P. Behler Chairman, chief executive, president

9.15

8.61

Norwegian Government Pension Fund Global (Norges Bank Investment Management) 505 Fifth Ave. New York, NY 10017

917-542-8500 nbim.no

Nicolai Tangen Chief executive

8.65

9.12

Boston Properties Inc. 599 Lexington Ave. New York, NY 10022

212-326-4000 bxp.com

Owen D. Thomas Chief executive

8.52

8.76

Empire State Realty Trust Inc. 111 W. 33rd St. New York, NY 10120

212-687-8700 empirestaterealtytrust.com

Anthony E. Malkin Chairman, chief executive

8.11

8.09 2

City of New York City Hall Park New York, NY 10007

212-639-9675 nyc.gov

Bill de Blasio Mayor

7.79

Blackstone Group Inc. 345 Park Ave. New York, NY 10154

212-583-5000 blackstone.com

Stephen Allen Schwarzman Chairman, chief executive

6.27

8.20

L&L Holding Co. 142 W. 57th St. New York, NY 10019

212-920-3360 ll-holding.com

David W. Levinson Chairman, chief executive

6.24 1

6.24

12 1

Hines 345 Hudson St. New York, NY 10014

212-230-2300 hines.com

Tommy Craig Senior managing director, New York tri-state office

6.02 1

4.91

12 1

Prudential Financial Inc. 751 Broad St. Newark, NJ 07102

973-802-6000 prudential.com

Stephanie Rivas Managing director

5.98

5.96

U.S. General Services Administration 1 World Trade Center New York, NY 10007

844-472-4111 gsa.gov

Katy Kale Acting administrator

5.92

Caisse de dépôt et placement du Québec 1211 Sixth Ave. New York, NY 10036

212-596-6300 cdpq.com/en

Michael Sabia President, chief executive

5.92

n/d

Hudson Square Properties, Trinity Church Wall Street 76 Trinity Place New York, NY 10006

212-602-0800 trinitywallstreet.org

Sujohn Sarkar Managing director, asset management

5.86 1

12 1

212-801-1000 related.com

Stephen M. Ross Founder, chairman Jeff T. Blau Chief executive

5.75

7.30

212-752-5000 fisherbrothers.com

Arnold Fisher, senior partner Steven Fisher, Winston Fisher, Ken Fisher, partners

5.50 1

The Related Cos. 30 Hudson Yards NY 10001 16 | CRAIN’SNew NEWYork, YORK BUSINESS | APRIL 26, 2021 Fisher Brothers Management Co. 299 Park Ave. P016_CN_20210426.indd 16 NY 10017 New York,

2021 RENTABLE BUILDING AREA (IN MILLIONS OF SQ. FT.)

2020 RENTABLE BUILDING AREA (IN MILLIONS OF SQ. FT.)

# OFFICE BUILDINGS IN MANHATTAN

Continued on page 1518

5 4/22/21 10:34 AM

SPONSORED CONTENT

Navigating supply chain and logistics challenges A

s consumers showed up at grocery stores in the early days of the pandemic and found staples such as paper towels and canned soup out of stock, Covid-19 proved a powerful reminder of the importance of a strong supply chain. Fast-forward to today, and most retailers and wholesalers are devoting extra attention to making sure they can keep shelves in their stores and warehouses full, and they have created backup plans to meet logistics challenges. The commercial real estate industry is on the front lines of addressing the nation’s storage and logistics challenges. To gather insight into the latest trends, Crain’s Content Studio spoke with Art Makris, senior vice president of Northeast operations for the real estate investment trust Duke Realty.

CRAIN’S: As the country starts to emerge from the pandemic, what were the most important lessons learned about the impact of supply chain and logistics challenges on commercial real estate, particularly in the industrial and warehouse sector?

that could change the way the commercial real estate industry must work this year?

and airports would be very helpful to our industry. CRAIN’S: Work stoppages have posed big challenges during inthe pandemic. Are you seeing any interesting coping strategies and workarounds emerging in commercial real estate, such as an increased use of automation?

ART MAKRIS: Given the growth of e-commerce, we do not see the demand for well-located high quality logistics space waning anytime soon. Just as we saw with the consumer goods supply chain, we have also seen an increase in the food grade and temperaturecontrolled supply chain—known in the industry as “cold chain”— that will continue to evolve and grow as consumers become more accustomed to ordering their groceries, fresh produce and pharmaceuticals online.

MAKRIS: Most markets that are seeing growth are also experiencing a shortage of skilled tradespeople needed to build projects. Our clients are seeing general labor shortages in many areas of the country as well. That is a concern, given that a large e-commerce facility may need to employ several thousand workers. On top of this, commodity pricing increases, specifically for steel and concrete, as well as shipping delays, have created challenges for those in the industry. On our build-to-suit projects, we work closely with our clients to try to get ahead of steel orders— sometimes even before lease execution. This allows us to accommodate schedule changes

In addition, major U.S. retailers and consumer products companies need “safety stock” to protect them against running out of inventory. This is expected to drive more than 500 million square feet of growth in the next few years.

“Improvements to and investments in our nation’s roads, highways, bridges, ports and airports would be very helpful to our industry.”

Beyond this, we’re likely to see an increased need for space for reverse logistics—the business of effectively and efficiently handling e-commerce returns. Reshoring or near-shoring of U.S. manufacturing operations will create new distribution channels throughout the U.S. markets. Finally, retailers and consumer products companies are investing hundreds of millions of dollars to upgrade their logistics facilities and supply chain networks across the country. The need to get more products to consumers in a 24- to 48-hour window is driving the need for larger, state-of-theart facilities. CRAIN’S: Do you anticipate any new outside influences

P017_CN_20210426.indd 17

MAKRIS: Here at Duke Realty, we are vigilant about tracking automation advancements in logistics and looking for ways to support our clients’ needs. As customers face challenges in finding qualified workers to support their projects, we are seeing significant investment in robotics and automation to help fill this gap. I believe we will continue to see investment and progress in automation to

related to the availability of materials.

help businesses grow despite a limited skilled labor market.

CRAIN’S: How have tariffs affected commercial property owners in New York? How big a factor will they be this year, given that we have a new administration in the White House with its own positions on trade?

CRAIN’S: How can the commercial real estate industry best cope with trading route closures now that they have become an unfortunate fact of life?

MAKRIS: There are many things on the new administration’s agenda that could help our industry. We’ve been discussing a new infrastructure bill for several years now. This seems to be a priority for President Joe Biden’s administration. Improvements to and investments in our nation’s roads, highways, bridges, ports

ART MAKRIS

Senior vice president of Northeast operations for the real estate investment trust, Duke Realty

inventory to weather significant upticks in demand by having safety stock on hand. This requires companies to expand their storage footprint to accommodate the additional inventory. Also, companies

should make sure they have enough raw materials on hand to continue manufacturing operations. In today’s environment, it is essential to find ways to operate without disruption.

MAKRIS: It is important for companies to diversify their trade routes and ports of entry. Companies should have options in case trade routes are disrupted or ports experience backups. Additionally, companies learned a big lesson at the start of the pandemic as they quickly ran out of inventory. Now, companies are ensuring they have enough

4/20/21 3:21 PM

18 19 THE 20 LIST TOP 21 COMMERCIAL OFFICE PROPERTIES 22 123 224 325 426 527 628 29 7 30 8 9 CRAIN WEBCAST 10 2021 11 MAYORAL DEBATES 12 Tuesday, May 11 | 3:30 – 5 p.m. 13 14 15 16 17 18 19 20 21 REGISTER TODAY: CrainsNewYork.com/Webcasts 22 23 24 RANK

Hines 345 Hudson St. New York, NY 10014

212-230-2300 hines.com

Tommy Craig Senior managing director, New York tri-state office

6.02 1

4.91

12 1

Prudential Financial Inc. 751 Broad St. Newark, NJ 07102

973-802-6000 prudential.com

Stephanie Rivas Managing director

5.98

5.96

U.S. General Services Administration 1 World Trade Center New York, NY 10007

844-472-4111 gsa.gov

Katy Kale Acting administrator

5.92

Caisse de dépôt et placement du Québec 1211 Sixth Ave. New York, NY 10036

212-596-6300 cdpq.com/en

Michael Sabia President, chief executive

5.92

n/d

Hudson Square Properties, Trinity Church Wall Street COMPANY/ 76 Trinity Place ADDRESS New York, NY 10006

212-602-0800 trinitywallstreet.org

Sujohn Sarkar Managing director, asset management

5.86 1

12 1

TheGreen Related Cos.Corp. SL Realty 30 Hudson Yards One Vanderbilt Ave. 10001 New York, NY 10017

212-801-1000 212-594-2700 related.com slgreen.com

Brookfield Properties Fisher Brothers 250 Vesey St. Management Co. 299 Park New York, Ave. NY 10281 New York, NY 10017

212-417-7000 212-752-5000 brookfieldproperties.com fisherbrothers.com

Cohen Brothers Realty Corp. Vornado Realty Trust 750 Seventh LexingtonAve. Ave. 888 10022 New York, NY 10019

212-838-1800 212-894-7000 cohenbrothersrealty.com vno.com

Jack Resnick & Sons Inc. RXR Realty 110Rockefeller E. 59th St.Plaza 75 10022 New York, NY 10019

PHONE/ WEBSITE

TOP LOCAL EXECUTIVE

2021 RENTABLE BUILDING AREA (IN MILLIONS OF SQ. FT.)

2020 RENTABLE BUILDING AREA (IN MILLIONS OF SQ. FT.)

# OFFICE BUILDINGS IN MANHATTAN

5.75 1 26.53

7.30 1 26.88

15 49 1

24.88 5.50 1

26.73 5.50 1

23 5

CharlesRoth S. Cohen Steven President, chief Chairman, chief executive executive

5.34 23.92

5.34 25.26

10 38

212-421-1300 212-797-1330 resnick.nyc rxrrealty.com

Jonathan D. Resnick Scott Rechler President chief executive Chairman,

5.24 1 16.52

13 1 16

The Moinian Group Tishman Speyer 3 Columbus Circle 45 Rockefeller Plaza 10019 New York, NY 10111

212-808-4000 212-715-0300 moinian.com tishmanspeyer.com

Joseph Moinian Rob Speyer Founder, chief President, chiefexecutive executive

4.94 1 14.83

4.93 14.83

21 17 1

JPMorgan Chase & Co.Inc. Silverstein Properties 383 Madison 7 World Trade Ave. Center 10179 New York, NY 10007

212-270-6000 212-490-0666 jpmorganchase.com silversteinproperties.com

Jamie A. Dimon Larry Silverstein, chairman Chairman, chiefchief executive Marty Burger, executive Tal Kerret, president

4.85 1 12.83

5.99 1 13.34

61 13

RFR Durst RealtyOrganization The 375 ParkPark Ave. 1 Bryant New York, NY 10152 10036

212-308-1000 212-257-6600 rfr.com durst.org

4.85 12.03

5.09 12.65

15 14

Allianz Real Estate 60 E.Real 42ndEstate St. GFP New Park York, Ave. NY 10165 125 New York, NY 10017

212-938-0670 allianz-realestate.com 212-372-2091 gfpre.com

Michael Fuchs Douglas Durst Aby Rosen Chairman Cofounder, principals Jonathan Durst President Christoph Donner ChiefGural, executive, operations Eric BrianAmerican R. Steinwurtzel Co-chief executives, principals Jeffrey Gural Chairman, principal

4.82 10.36 1

7.66 10.36

4 42 1

Stephen M. Ross Marc Holliday Founder, chairman Chairman, chief executive Jeff T. Blau Chief executive Ric Clark Arnold Fisher, senior partner Chairman Steven Fisher, Winston Fisher, Ben Brown Ken Fisher,partner partners Managing

Sources: CoStar Group and the property owners, with additional research by Chuck Soder and Bill Lucey. Unless otherwise noted, data for 2019 and 2020 is as of March. All figures have been rounded, but calculations and rankings are based on Rudin Management Co. Inc. William C. Rudin 10.10 1 10.10 15 unrounded numbers. n/d-Not disclosed. Q4 2019. 1--From the company. 2--As of212-407-2400

345 Park Ave. New York, NY 10154

rudin.com

Co-chairman, chief executive Eric Rudin Co-chairman, president

Qatar Investment Authority 9 W. 57th St. New York, NY 10019

646-740-5900 qia.qa

Sheikh Abdulla bin Mohammed bin Saud al-Thani Chief executive

9.67

Paramount Group Inc. 1633 Broadway New York, NY 10019

212-237-3100 paramount-group.com

Albert P. Behler Chairman, chief executive, president

9.15

Norwegian Government Pension Fund Global (Norges Bank Investment Management) 505 Fifth Ave. New York, NY 10017

917-542-8500 nbim.no

Nicolai Tangen Chief executive

8.65

9.12

Boston Properties Inc. 599 Lexington Ave. New York, NY 10022

212-326-4000 bxp.com

Owen D. Thomas Chief executive

8.52

8.76

Empire State Realty Trust Inc. 111 W. 33rd St. New York, NY 10120

212-687-8700 empirestaterealtytrust.com

Anthony E. Malkin Chairman, chief executive

8.11

City of New York City Hall Park New York, NY 10007

212-639-9675 nyc.gov

Bill de Blasio Mayor

7.79

Blackstone Group Inc. 345 Park Ave. New York, NY 10154

212-583-5000 blackstone.com

Stephen Allen Schwarzman Chairman, chief executive

6.27

8.20

L&L Holding Co. 142 W. 57th St. New York, NY 10019

212-920-3360 ll-holding.com

David W. Levinson Chairman, chief executive

6.24 1

Hines 345 Hudson St. New York,New NY 10014 Crain’s York

212-230-2300 hines.com

Tommy Craig Senior managing director, New York tri-state office Debates where of Mayoral

Business will host a series candidates willPrudential haveFinancial the opportunity to speak on key issuesStephanie impacting the region. Inc. 973-802-6000 Rivas 751 Broad St. Newark, NJ 07102

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The first event in the series will feature top contenders from the Democratic U.S. General Services Administration 844-472-4111 Katy Kale primary asCenter they address the economy, health and 1 World Trade gsa.gov Actingsafety, administratortheir vision for NYC, New York, NY 10007 quality of life concerns and a variety of other pertinent topics.

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6.24

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4.91

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5.98

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Michael Sabia President, chief executive

5.92

Hudson Square Properties, Trinity Church Wall

212-602-0800

Sujohn Sarkar

5.86 1

76 Trinity Place

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8.09 2

6.02 1

Caisse de dépôt et placement du Québec 1211 Sixth Ave. New York, NY 10036

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Fisher Brothers Management Co. 299 Park Ave. New York, NY 10017

P018_CN_20210426.indd Cohen18 Brothers

Realty Corp. 750 Lexington Ave.

212-752-5000 fisherbrothers.com

Arnold Fisher, senior partner Steven Fisher, Winston Fisher, Ken Fisher, partners

5.50 1

212-838-1800 cohenbrothersrealty.com

Charles S. Cohen President, chief executive

5.34

4/23/21 10 5:47 PM

CANNABIS

New York’s marijuana law plants seeds for labor unions to grow their ranks BY RYAN DEFFENBAUGH

he state’s new recreational marijuana market could prove to be fertile ground for labor unions. Already about 500 workers in the state’s medical marijuana market have voted to unionize and have reached deals with their employers. A provision in the state law allowing recreational marijuana for adults— signed April 1 by Gov. Andrew Cuomo—is likely to encourage unionization for workers in that much larger market.

all be union,” said Joseph Fontano, secretary-treasurer of Local 338. “All workers are entitled to dignity and respect on the job.”

Peace agreements The Marijuana Regulation and Taxation Act signed by Cuomo this month requires that any applicant for a license to grow, distribute or sell cannabis products enter into a labor peace agreement with a union. In a labor peace agreement, employers agree to stay neutral if their employees attempt to organize, and unions agree not to encourage work stoppages against the employer. New Jersey and California have required labor peace agreements for licensed companies in their marijuana markets. Illinois law says such agreements boost an applicant’s likelihood of winning a license. Encouraging organized labor, unions say, will help New York keep its pledge to create a marijuana market that addresses the harms of the decades-long war on drugs. “The Legislature listened to calls by workers and advocates to create an industry centered on equity,” RWDSU President Stuart Appelbaum said after the bill’s passage. “From the creation of a social-equity fund to requiring labor peace for cannabis license holders, this places New York on the forefront of social equity nationally.”

“IT’S ABOUT MAKING THIS A FAIR PLAYING FIELD FOR ALL INVOLVED” Most recently, Local 338 of the Retail, Wholesale and Department Store Union reached a deal on behalf of 40 workers at Cresco Labs, which runs medical dispensaries called Sunnyside in Williamsburg, on Long Island and upstate. The deal, finalized April 15, promises 4% annual wage increases and full health care coverage, among other benefits. The union representing the workers said the agreement sets a standard for the marijuana industry, which is primed to grow exponentially. “There will be 30,000 to 60,000 employees working in marijuana in New York, and we think they should

Labor peace agreements are already required for companies in New York’s medical marijuana market, created in 2014 through the Compassionate Care Act. A little more than one-fifth of all New York workers are represented by a union, according to Census Bureau data, the second-highest rate in the nation behind Hawaii. But union ranks have been on the decline for the past three years, particularly in the private sector. In the six years the medical marijuana market has been active, Local 338 has negotiated contracts for about 500 employees at six of the 10 licensed cannabis companies in New York. RWDSU is affiliated with the 1.3 million-member United Food and Commercial Workers union, which says it represents tens of thousands of cannabis workers across the country. Cresco Labs, which reached the deal with Local 338, did not respond to a request for comment last week.

‘Quid pro quo’ Labor peace agreements are not exclusive to the marijuana market. They have been around for years in telecommunications, hospitality and other industries. It is unusual, however, for a labor agreement to be mandated by the state, said Marvin Weinberg, a partner at the law firm Fox Rothschild who represents employers. The setup creates leverage for unions to negotiate terms friendly to them in the deal.

BLOOMBERG

States are requiring labor agreements for cannabis companies

“It is essentially a quid pro quo or two-way street, though I think it is a street that tilts in favor of the union,” Weinberg said. In a Cannabis Business Executive column, Weinberg noted that labor peace agreements could be preempted by the National Labor Relations Act, “but thus far there have not been any successful court challenges.” Unionization efforts in the cannabis industry have kicked into overdrive since October, said employer law firm Seyfarth Shaw. Workers at 10 separate facilities have voted to unionize since then in New Jersey, Pennsylvania, Rhode Island, Massachusetts, Illinois, California and the District of Columbia. With the assumed labor-friendly approach from the Biden adminis-

tration, attempts at unionization in the cannabis industry are only expected to increase,” Ethan Goemann, an associate at the firm, wrote on the company blog.

More opportunities Tyler Curtis, a wellness adviser at Sunnyside in Williamsburg, said beyond the financial benefits of the contract, he hopes unionizing can bring more training opportunities and ways to advance in the industry. The 26-year-old said he would like to open his own business in the marijuana industry down the road. “It’s about making this a fair playing field for all involved,” Curtis said. “Having a unionized movement and an expanded adult-use market will create a legitimized industry.” ■

REAL ESTATE

Chang’s hotel group pays more than $11 million for defunct Flushing church

eveloper Sam Chang’s McSam Hotel Group is the new owner of a defunct church in Flushing. A limited-liability company affiliated with the prolific hotel developer’s firm has purchased 135-25 Northern Blvd. for nearly $11.3 million from an LLC affiliated with DW Commercial Real Estate, property records show. The 2-story building spans about 29,000 square feet, according to city records.

vacant, and the lot allows for up to roughly 58,000 as-of-right buildable square feet, Cushman said.

135-25 NORTHERN BLVD.

No specific plan An LLC linked to Regent Medical Properties of Glen Rock, N.J., purchased the building for $19 million in 2017, and Sovereign Health System filed plans in 2019 to construct a 12-story medical building on the site, spanning about 147,000 square feet, city records show. The plans never came to fruition, however. McSam Hotel Group does not have specific plans for the property, according to company spokeswoman Lauren Elkies Schram. Representatives for DW Commercial Real Estate did not respond to a request for comment. Chang is a prolific hotel developer in the city and has focused on

CUSHMAN & WAKEFIELD

BY EDDIE SMALL

THE PURCHASED LOT ALLOWS FOR ROUGHLY 58,000 BUILDABLE SQUARE FEET A Cushman & Wakefield team led by Vice Chairman Stephen Preuss brokered the deal. The property is

building inexpensive accommodations for tourists. He recently parted ways with multiple projects amid the chal-

lenging market for hotels in New York. In the fall he sold his Marriott project at 140 W. 28th St. in Chelsea for more than $147 million to the

Phoenix Hospitality Group. In December he sold his hotel project at 338 W. 39th St. for $31.5 million to an LLC linked with Ivy Realty. ■

APRIL 26, 2021 | CRAIN’S NEW YORK BUSINESS | 19

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NOTICE OF FORMATION OF Walking Stick Studios LLC. Articles of Organization filed with the Secretary of State of NY (SSNY) on 10/2020. 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: 7014 13th ave Suite 202 Brooklyn NY 11228. The principal business address of the LLC is: 468 W 58th St New York, NY.

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Notice of Formation of RAG MEDICAL, PLLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 03/29/21. Office location: NY County. SSNY designated as agent of PLLC upon whom process against it may be served. SSNY shall mail process to Corporation Service Co., 80 State St., Albany, NY 12207-2543. Purpose: Medical.

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PUBLIC & LEGAL NOTICES Notice of Formation of ETKIN GOLD LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 02/03/21. Office location: NY County. Princ. office of LLC: Michael L. Martell, Esq., Morrison Cohen LLP, 909 3rd Ave., 27th Fl., NY, NY 10022. 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.

Notice of Qualification of SUP SKYLINE LLCAppl. for Auth. filed with Secy. of State of NY (SSNY) on 03/ 26/21. Office location: NY County. LLC formed in Delaware (DE) on 03/ 23/21. Princ. office of LLC: 500 Stanton Christiana Rd., NCC2, Fl. 02, Newark, DE 19713. 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 FORMATION of Kinzey Growth Partners, LLC. Arts of Org filed with Sec. of State of NY (SSNY) on 1 2/14/20. Office location: NY County, SSNY designated as agent upon whom process may be served and shall mail a copy of process against LLC to 369 Lexington Ave., 3rd Fl, New York, NY 10017. Purpose: any lawful act.

NOTICE OF FORMATION of Dilone Consulting Services LLC. Arts of Org filed with Secy. of State of NY (SSNY) on 9 /23/20. Office location: NY County. SSNY designated agent upon whom process may be served and shall mail copy of process against LLC to 19 Cumming Street, Apt 5L, New York, NY 10034. Purpose: any lawful act.

Notice of Qualification of Upper90 Partners SPV GP II, LLC. Authority filed with Secy. of State of NY (SSNY) on 03/11/21. Office location: NY County. LLC formed in Delaware (DE) on 10/23/19. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to: 114 W 26th St., 5th Fl., NY, NY 10001. Address to be maintained in DE: 251 Little Falls Dr., Wilmington, DE 19808. Arts of Org. filed with the Secy. of State, 401 Federal St. Ste 4 Dover DE 19901. Purpose: any lawful activities. Notice of Qualification of Skydance Animation East, LLC. Authority filed with Secy. of State of NY (SSNY) on 0 3/11/21. Office location: NY County. LLC formed in Connecticut (CT) on 03 /09/21. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to: c/o Jesse Sisgold, Skydance Media, 2900 Olympic Blvd., Santa Monica, CA 90404, also the principal office address. Arts of Org. filed with the Secy. of State, 165 Capitol Ave., Hartford, CT 06106. Purpose: any lawful activities. Notice of Qualification of SAMARA CAPITAL LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 03/15/21. Office location: NY County. LLC formed in Delaware (DE) on 03/11/21. 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 of the State of DE, Dept. of State, Div. of Corps., John G. Townsend Bldg., 401 Federal St. Ste. 4, Dover, DE 19901. Purpose: Any lawful activity.

Notice of Qualification of MSG CHICAGO, LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 03/03/21. Office location: NY County. LLC formed in Delaware (DE) on 06/01/07. 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: c/o CSC, 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with DE Secy. of State, Div. of Corps., John D. Townsend Bldg., 401 Federal St., Ste. 4, Dover, DE 19901. Purpose: Any lawful activity.

NOTICE OF FORMATION of Str8StackinBulliesKennel, LLC. Articles of Organization filed with the Secretary of State of New York (SSNY) on 03/11/2021. Office Location: BRONX County. SSNY 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: 1036 Manor Ave apt 2C. The principal address of the business shall be located: Online. Purpose: Any lawful act or activity.

Notice of Qualification of EW DIRECT 1 NASSAU, LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 03/04/21. Office location: NY County. LLC formed in Delaware (DE) on 03/02/21. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to c/o Corporation Service Co., 80 State St., Albany, NY 12207-2543. DE addr. of LLC: 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with DE Secy. of State, 401 Federal St., Ste. 4, Dover, DE 19901. Purpose: Any lawful activity.

Notice of Qualification of DAVID ZWIRNER DIGITAL, LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 03/22/21. Office location: NY County. LLC formed in Delaware (DE) on 12/16/20. Princ. office of LLC: 525 W. 19th St., NY, NY 10011. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to the LLC, 80 State St., Albany, NY 12207. DE addr. of LLC: 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.

Notice of Qual. of 28 W. 36th Street Sole Member LLC, filed with the SSNY on 3/1/2021. Office: NY County. LLC formed in DE on 2/22/2021. SSNY is designated as agent upon whom process against the LLC may be served and shall mail process to: 28 W 36 St, Ste 301, NY, NY 10018. Address required to be maintained in DE: 850 New Burton Rd, Ste 201, Dover, DE 19904. Cert of Formation filed with DE Sect’y of State, 401 Federal St, PO Box 898, Dover, DE 19901. Purpose: any lawful act.

NOTICE OF QUALIFICATION of Steady Rent, LLC. Authority filed with Secy. of State of NY (SSNY) on 2/11/21. Office loc: NY County. LLC formed in DE on 1/12/21. SSNY designated agent upon whom process may be served & mailed to: 379 W. Broadway, FL 2, NY NY 10012. DE address of LLC: c/ o Corp Service Co, 251 Little Falls Dr, Wilmington, DE 19808. Cert. of LLC filed with Secy. of State of DE loc: John G. Townsend Bldg, 401 Federal St, #4, Dover DE 19901. Purpose: Any lawful activity.

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Notice of Qualification of SPRING VALLEY PRESERVATION LIMITED PARTNERSHIP Certificate of Limited Partnership was filed with the Secretary of State of New York (SSNY) on 0330-2021. Office located in NEW YORK COUNTY. SSNY has been designated as agent of LP upon whom process against it may be served. SSNY shall mail process to 200 Vessy Street, 24th Floor, New York, NY 10281. The name of general partner is HVPG Spring Valley Preservation, LLC, 1209 Orange St, Wilmington, DE 19801. Purpose: any lawful purpose.

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Notice of formation of Ecotage Clothing LLC. Articles of Organization filed with the Secretary of State of New York SSNY on 03/09/2021. Office located in New York. SSNY has been designated for service of process. SSNY shall mail copy of any process served against the LLC Registered Agents Inc. 90 State Street STE 700 Office 40 Albany, NY 12207 Purpose: any lawful purpose.

NOTICE OF FORMATION OF A. ROSE B LLC. Articles of Organization filed with the Secretary of State of New York on 03/18/2021. 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 301 E 117th St, 2X, New York, NY 10035. Purpose: any lawful act or activity.

Notice of Formation of N KNOTEL PLATFORM 2017, LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 03/10/21. Office location: NY County. Princ. office of LLC: 110 E. 59th St., NY, NY 10022. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to Corporation Service Co., 80 State St., Albany, NY 12207. Purpose: Any lawful activity.

Notice of Formation of Kohzi Suites LLC. filed with Secy. of State of NY (SSNY) on 12/29/20. Office location: Bronx County. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to the LLC, 519 Tinton Avenue, Bronx, NY 10455 . Purpose: any lawful activity.

Notice is hereby given that a license, number pending, for beer, cider, liquor and wine has been applied for by the undersigned to sell beer, cider, liquor and wine at retail in a restaurant under the Alcoholic Beverage Control Law at 275 Madison Avenue Ste 130, New York, NY 10016 in New York County for on premises consumption. SS2 Inc. DBA Summer Salt

Notice of Formation of MANUKAKI12K, LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 03/04/21. Office location: NY County. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to c/o Law Offices of Anthony S. Cannatella, 53 Orchard St., Manhasset, NY 11030. Purpose: Any lawful activity.

Notice of Formation of RTW GoCo LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 03/26/21. Office location: NY County. Princ. office of LLC: 40 10th Ave., Fl. 7, NY, NY 10014. 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 PARKSIDE AMHERST RELATED CLASS C, LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 03/18/21. Office location: NY County. Princ. office of LLC: 30 Hudson Yards, 72nd Fl., NY, NY 10001. 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 122072543. Purpose: Any lawful activity.

Notice of Qualification of EQ SERVICES LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 03/04/21. Office location: NY County. LLC formed in Virginia (VA) on 12/09/09. Princ. office of LLC: 31 Hudson Yards, NY, NY 10001. 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 Clerk of the Commission, 1300 E. Main St., 1st Fl., Richmond, VA 23219. Purpose: Any lawful activity.

Notice of Qualification of ND Growth Investors II, L.P. Authority filed with Secy. of State of NY (SSNY) on 03/ 11/21. Office location: NY County. LP formed in Delaware (DE) on 03/ 08/21. SSNY designated as agent of LP upon whom process against it may be served. SSNY shall mail process to: 9 Great Jones St. Fl. 4, NY, NY 10012. Address to be maintained in DE: Corporation Trust Center, 1209 Orange St., Wilmington, DE 19801. Name/address of genl. ptr. available from SSNY. Cert. of LP filed with DE Secy. of State, 401 Federal St., Ste. 3, Dover, DE 19901. Purpose: any lawful activities.

ITALIA REALTY, LLC. Arts. of Org. filed with the SSNY on 03/15/21. 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, c/o BSB Associates Ltd., 201 Moreland Road, Suite 3, Hauppauge, NY 11788. Purpose: Any lawful purpose.

Notice of formation of Farrgo Fooatge LLC. Arts of Org filed with Secy. of State of NY (SSNY) on 1/25/21. Office location: NY County. SSNY designated as agent upon whom process may be served and shall mail copy of process against LLC to 244 Madison Ave, #1470, New York, NY 10016. Purpose: any lawful act.

Notice of formation of Moments In Time Chef and Caterering LLC. Arts of Org. Filed with Secy. of State of NY on 11/18/2020 NY County SSNY. Agent upon whom process to be served and copy mailed of process against LLC to 1885 Adam Clayton powel BLVD 1A NY NY10026 for any lawful act.

Notice of Formation of Ballistic Sprint LLC. Arts of Org Filled with Secy. of State of NY (SSNY) on 1/21/21. Office location: New York County. SSNY designated as agent upon whom process may be served and shall mail copy of process against LLC to 151 East 26th St, Unit 4D, New York, NY 10010. Purpose: any lawful act.

BACK FIFTY LLC, Arts. of Org. filed with the SSNY on 03/15/2021. Office loc: NY County. SSNY has been designated as agent upon whom process against the LLC may be served. SSNY shall mail process to: The LLC, 145 Nassau Street, Apt 5D, NY, NY 10038. Reg Agent: U.S. Corp. Agents, Inc. 7014 13th Ave., Ste 202, Brooklyn, NY 11228. Purpose: Any Lawful Purpose.

Notice of Formation of N KNOTEL 110 WILLIAM LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 03/10/21. Office location: NY County. Princ. office of LLC: 110 E. 59th St., NY, NY 10022. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to Corporation Service Co., 80 State St., Albany, NY 12207. Purpose: Any lawful activity.

INDUSTRY ACHIEVERS ADVANCING THEIR CAREERS Recognize them in Crain’s

Notice of Qualification of KNICKS HOLDINGS, LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 03/03/21. Office location: NY County. LLC formed in Delaware (DE) on 05/19/15. NYS fictitious name: MSG KNICKS HOLDINGS, LLC. 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 DE Secy. of State, Div. of Corps., John D. Townsend Bldg., 401 Federal St., Ste. 4, Dover, DE 19901. Purpose: Any lawful activity. Notice of Qualification of MSG LAS VEGAS, LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 03/03/21. Office location: NY C ounty. LLC formed in Delaware (DE) on 03/09/16. 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 DE Secy. of State, Div. of Corps., John D. Townsend Bldg., 401 Federal St., Ste. 4, Dover, DE 19901. Purpose: Any lawful activity. Notice of Formation of PRINCETON AMHERST DEVELOPER, LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 03/18/21. Office location: NY County. Princ. office of LLC: 30 Hudson Yards, 72nd Fl., NY, NY 10001. 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 122072543. Purpose: Any lawful activity.

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future, a golden goose,” she said. “In those days they were promoting to people to borrow and buy.” Things changed in the 2010s, though. More than 120,000 Uber and Lyft vehicles flooded the city streets in a seven-year period, while taxi medallion vehicles remained capped at 13,595. The loss in taxi fares was soon followed by an overall loss in value. For the owners and investors

costly litigation. “This lawsuit became absolutely necessary because, without the attorney general’s lawsuit, there’d be nothing,” Norinsberg said. “We are finishing the job that Attorney General James started.” The suit claims the city violated a statute normally reserved for prosecuting mobsters: the Racketeer Influenced and Corrupt Organizations Act. Three former TLC commissioners—Matthew Daus, David Yassky and Meera Joshi—whose tenure lasted from 2004 to 2019, artificially inflated the minimum sales price of the medallion to manipulate both its secondary market and auction market price, and they used the proceeds to plug city budget deficits, according to the suit. Through manipulation by the city, the attorneys say, a medallion’s value was untethered to actual market conditions. “The price was determined based on what the TLC felt was the most they could charge and sell medallions for,” Norinsberg said. The city received more than $855 million in revenue between 2002 and 2014 from the sale of medallions through auctions and transfer taxes, according to the state. Daus and Yassky declined to comment. Joshi did not respond to requests for comment. The TLC and the city’s Law Department did not respond to a request for comment. Another former city taxi official,

“WE ARE FINISHING THE JOB THAT ATTORNEY GENERAL JAMES STARTED” who hold a medallion’s paperwork, something else has disappeared along with their investment: a stable future. “We trusted the city. I voted for that government,” Kaminker said. “We need justice.”

A day in court Kaminker’s attorneys, Jon Norinsberg and Joshua Fitch, said they filed the lawsuit to fill the gap left after state Attorney General Letitia James’ office withdrew an $810 million notice of claim investigation into the TLC this year. The state dropped the case, James’ office said, because cab owners were better served by a bailout plan supported by the New York Taxi Workers Alliance rather than years of

David Klahr, who served as the TLC’s executive director of financial planning and analysis from 2007 to 2016, said he sees merit in the plaintiffs’ claim. It was an “inherent conflict of interest” that the agency held auctions for the same medallion they were in charge of regulating, he said. The motivation to see medallion prices rise became “tremendous” not just for investors but for the regulator itself, he added. “It was an internal policy at the TLC to never distribute news that could be seen as detrimental to the value of the medallion,” Klahr said. “It was city policy for a long time that the metric the city used to determine the health of the industry was the medallion price.” He said now he does not believe the medallion has any value at all. “I think it’s a worthless commodity, a bad business, bad investment,” he said.

medallion as a safe investment vehicle, one that ensured returns “better than the stock market,” even when the agency allegedly had information that the license had overrun its value. A 2010 internal memo written by former TLC policy analyst Gary Roth, which warned the price of the medallion was higher than the income drivers could produce even under the best market conditions, is a central piece of evidence for the suit. Roth’s memo, first revealed in 2019, argued that the demand for medallions would collapse as soon as their inflated values were exposed. Former TLC Commissioner Christopher Lynn, who ran the agency from 1996 to 1998, called the class-action lawsuit “a slam dunk” against the commission, due to the claims in Roth’s report. “You had an internal memo saying, ‘These prices are inflated, and they are not justified,’ ” Lynn said. “They had actual notice of the fact that there was a problem with the valuation. That should’ve been disclosed.” Other transportation experts said they are skeptical that a class-action suit can prove commonality among the parties or that the city

A tough sell Kaminker is intent on proving that she and her fellow plaintiffs are victims of a fraud perpetrated on an uninformed group of immigrants. She said that even though the TLC knew medallions’ value would drop, it still promoted them as safe investments. “If the city would’ve told us [it would] be making regulatory changes and the value would likely go down, do you think we’d hold on to it?” Kaminker asked, rebutting any presumption that she is simply an unsophisticated investor. The complaint details multiple instances of the TLC promoting the

HERO week. The National Federation of Independent Business in New York called the bill “potentially the most anti–small business piece of legislation passed through Albany in recent years.” “It has the potential to impose Covid-19-specific restrictions, regulations and standards—that small businesses are already dealing with—well beyond the emergency period, indefinitely,” said Greg Biryla, the NFIB’s New York director. “It doesn’t apply to one set of workers. It applies to the economy of the state across the board.”

Expressing concern More than 31 business associations—including the Queens Chamber of Commerce, the New York State Restaurant Association and New York State Builders Association—signed an April 16 letter addressed to the Assembly to express their concerns with the legis-

CUOMO

all airborne communicable diseases, like the common cold, which essentially imposes Covid operating procedures to continue in perpetuity,” said Michael Durant, president and CEO of the Food Industry Alliance of New York State. “Lawmakers failed their constituents by not seeking input from the business community on what has and has not worked during the pandemic or considered what operational changes will remain moving forward.” The Hero Act would establish uniform workplace protocols on cleaning; the use of masks and other personal protective equipment; health screenings; social distancing; and airflow controls. It also would create anti-retaliation protections for workers who want to expose employers’ noncompliance.

“IT COSTS EXTRA MONEY, AND IT IS AN INTRUSION INTO BUSINESS OPERATIONS” lation, arguing that its regulations would “expose distressed employers to predatory lawsuits” and “create significant new costs” for large and small employers. “The bill is overly broad and expansive and could apply to any and

The bill would imposes $50-perday fines and no less than a $10,000 total fine for failure to abide by the new safety standards. “A lot will depend on how this will get implemented,” said Joseph Harris, a management employment lawyer. “There’s some very broad language. ‘Proper air flow.’ ‘Other special design requirements.’ What does all of that mean?” Due to the bill’s language, Harris said, he could foresee unintentional noncompliance resulting in fines for business owners.

Two views Democratic lawmakers this week celebrated the passage of the bill, which garnered union support, notably from the New York State Nurses Association and the Align alliance of labor and community organizations. “Too many workers have already sacrificed their health for our com-

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munity’s benefit. The New York Hero Act honors their efforts by giving workers the tools to protect themselves while on the job,” said Michael Gianaris of Queens, the Senate’s deputy majority leader and a sponsor of the measure. The bill’s supporters argue that New York has not done enough about worker protection and that the federal Occupational Safety and Health Administration merely provides guidance and does not have enforceable health or safety standards protecting workers from airborne diseases. Sen. Jessica Ramos of Queens, chairwoman of the Senate labor committee, dismissed the business community’s concerns about overreach. “Here in New York, we have seen how businesses have tried to cut corners on safety in order to save a few cents,” Ramos said. “We are here to say we are putting people over profits.” The bill would allow for the formation of workplace safety committees composed of employees. The committees could raise safety concerns, review policies and participate in site visits by government regulators. “I believe that workers are the best informed on their experience to design ways in which to keep themselves protected at the workplace, or make improvements to workplace safety,” Ramos said. “The way workers want to feel protected is the way workers should be protected.” New York City’s major corporations said the bill’s establishment of workplace safety committees would

YASSKY

BUCK ENNIS

BROKEN

intended to commit the alleged fraud. “It’s a stretch,” said Steven Shanker, a lawyer who represents the Livery Round Table. “It’s not going to be an easy case. The issue is: Did the TLC do anything wrong?” The use of the RICO statute could present an obstacle. “It hasn’t been settled that a governmental entity can be sued under RICO,” said transportation lawyer Wayne Badin. “The plaintiffs have a very difficult case ahead of them.” Kaminker said she imagines the road forward will be difficult, but she’s optimistic her story will be instrumental in holding the city accountable. “My father believed in the American dream. He believed in this government and believed in this city,” she said. “My story is a simple story of a girl who believed in the American dream. Give us what you promised us.” ■ be redundant and unnecessary. “That’s the only major problem with the bill now,” said Kathryn Wylde, chief executive of the Partnership for New York City. “It’s that they did not allow for any exceptions or for those companies that already set up mechanisms to deal with employee workplace safety concerns,” she said. “It costs extra money, it’s extra bureaucracy and it is an intrusion into business operations.”

Unduly burdensome Similar workplace safety bills have been signed into law in Illinois and Virginia, according to James Brudney, chairman of economic and employment law at Fordham Law School. “The fact that we have a continuing problem with the disease, that we expect variants and no one expects this to go away tomorrow, is all relevant to the idea that some regulation is needed,” Brudney said. “Not knowing yet what the standard looks like makes it hard to know if it will be unduly burdensome.” The ball now lies in Cuomo’s court. The beleaguered Democratic governor is facing an impeachment inquiry from his own party, and state Attorney General Letitia James is investigating sexual-harassment allegations against him. So far, Cuomo’s office has remained noncommittal toward the legislation. A statement from the office seemed to imply that current safety standards are up to par. Senior adviser Richard Azzopardi said the chief counsel’s office was reviewing the bill. ■

22 | CRAIN’S NEW YORK BUSINESS | APRIL 26, 2021

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GOTHAM GIGS

BUCK ENNIS

COAXUM created his startup to focus on overlooked populations.

WOLE COAXUM AGE 50 BORN Cleveland, Ohio RESIDES New Rochelle EDUCATION Bachelor’s in history, Williams College; MBA, NYU Stern School of Business HOW IT WORKS MoCaFi bank accounts are chartered with the FDIC through a partnership with Sunrise Banks. The startup draws its revenue through the exchange fees merchants pay credit-card processors. BIG BACKING MoCaFi’s investors include the Partnership Fund for New York. TEE TIME Coaxum has run the New York Marathon twice, but he is now more focused on golf. “Golf is a good way to get outdoors and clear my mind.” FAMILY BUSINESS? He’s not looking for his two daughters to follow in his footsteps. “All I hope for is that they do something that is meaningful to them.”

Banking on the underserved

Former JPMorgan exec launches startup to address racial wealth gap BY RYAN DEFFENBAUGH

ole Coaxum had reached the upper ranks of Wall Street when, in 2014, he felt compelled to change course. The JPMorgan Chase managing director watched as protests erupted in Missouri in response to the police killing of Michael Brown, an unarmed Black teenager. As a Black executive in finance, Coaxum felt a call to action amid demonstrations against systemic racism. “It was one of those moments in life where you say, ‘Am I living my full purpose?’ ” Coaxum recalled. “I felt that my community needed me and that my fortune to train at Citigroup and JPMorgan had prepared me to have an impact.” In 2015 he launched Mobility Capital Finance, or MoCaFi, a financial-tech startup focused on helping people with low and moderate incomes who are often overlooked by

traditional banks. The firm hopes to address the country’s racial wealth gap by closing disparities in banking access. The startup has about 30,000 customers, who can access free mobile check-cashing through its app and draw cash from a network of 55,000 zero-fee ATMs. In March it closed a $12 million Series A investment round, with the backing of Citi and Mastercard. About 5% of American households did not have a checking or savings account in 2019. The total climbed to 14% for majority Black households and 12% for majority Hispanic households, according to Federal Deposit Insurance Corp. data. People without banking services often pay stiff fees to cash paychecks at stores or payday lenders. Before launching the business, Coaxum visited check-cashing stores near MoCaFi’s current office, on 125th Street in Harlem, and talked with customers. “One individual told me, ‘These

check cashers are tough. I’m working 40 hours and getting paid for 30,’ ” he said. Born in Cleveland, Coaxum moved to Brooklyn as a teenager. He landed an internship at JPMorgan in the summer between high school and college. He started his career in investment banking at Citigroup and was a senior executive at insurer Willis Towers Watson before being hired by JPMorgan Chase. “I had a front-row seat to seeing how financial services can change communities,” Coaxum said. Now he wants MoCaFi to drive change in underbanked communities. “It is not that these aren’t great institutions, but the business model just does not lend itself to serving vulnerable, underserved populations,” he said. There were certainly risks in leaving his job in finance behind. “But it was more important to be part of the conversation,” he said, “to get in the game.” ■

“I HAD A FRONT-ROW SEAT TO SEEING HOW FINANCIAL SERVICES CAN CHANGE COMMUNITIES”

APRIL 26, 2021 | CRAIN’S NEW YORK BUSINESS | 23

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