Crain's New York Business

ARTS BOOST MacKenzie Scott makes it rain in NYC PAGE 3

IN THE MARKETS Krispy Kreme’s IPO comes with a big hole for investors PAGE 6

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JUNE 28, 2021

ADAMS

BUCK ENNIS

A diverse group of young risk-takers will play a major role in New York City’s rebound PAGE 15 MAYORAL RACE 2021

Adams’ lead buoys city’s business leaders

The primary results are still being counted, but the Brooklyn pol is ahead by 9 points

BY BRIAN PASCUS

E

ric Adams’ commanding lead in the mayoral primary has New York business leaders hopeful that his approach to public safety, support for business and experience in city government will make him the right candidate to lead the city’s rebound from Covid-19.

Throughout the campaign, Adams' positive approach toward the business community, together with his support for real estate development and a tough-on-crime posture, stood out to executives.

Adams, seen as a centrist among his primary rivals, is expected to usher in a stark change from eight years of Mayor Bill de Blasio, who has feuded with the New York City Police Department and Gov. An-

NEWSPAPER

VOL. 37, NO. 25

© 2021 CRAIN COMMUNICATIONS INC.

drew Cuomo and alienated even Democratic voters with an uneven response to the pandemic. Moderate Democrats and incumbents appear on track to hold a slim majority of seats in the City Council, another Election Day development that could bode well for the business community and a potential Adams administration.

Turnout exceeded expectations, as more than 850,000 New Yorkers cast votes in the Democratic and Republican primaries, and about 100,000 ballots remain to be counted this week and next. By comparison, voters in the 2013 Democratic primary cast about 691,000 ballots.

The first-time use of ranked-choice voting will likely delay the official tally of the final results until See ELECTIONS on page 26

SoHo startup sells shares in collectibles

LARGEST ARCHITECTURE FIRMS IN THE METRO AREA

PAGE 27

PAGE 12

SPOTLIGHT

ECONOMY

BY RYAN DEFFENBAUGH

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organ Stanley last week became one of the earliest corporate employers to mandate staff be vaccinated against Covid-19 before returning to the office—potentially prompting other companies in the city to set their own policy.

“There has been a wait-and-see approach to this point from employers,” said Kathryn Bakich, health compliance practice leader at Segal, a HR consulting firm headquartered in the Flatiron District.

As major companies set policies, others will likely start doing the same, although whether they will re-

The company won’t check credentials, however, allowing staff to self-report their status. The memo is among a series of pronouncements from major city employers about vaccines in the workplace in recent weeks, as some industries gear up for a return to the office.

JPMorgan Chase, the city’s second-largest private employer, said in a memo to employees last Wednesday that it might soon require vaccination to return to the office. In the meantime, it is mandating only that staff report their vaccination status.

New York-Presbyterian Hospital said this month that it will require all staff in its health system to be vaccinated by the end of summer.

Most employers, however, have been hesitant to require Covid-19 jabs, polling shows. Just 27 of 280 Manhattan employers planned to require that staff be vaccinated, according to a survey by business group Partnership for New York City.

About 72% of the employers surveyed said they wouldn’t require vaccination in order to return to the office; 10% hadn’t decided.

“THE RATE IS SO HIGH THAT THERE IS NOT REALLY A NEED TO MANDATE VACCINATION” quire vaccines to return to the office will vary greatly by industry, company size and location, experts say.

Morgan Stanley employees will have to be vaccinated before entering the investment bank’s New York workplaces starting July 12, according to a company memo circulated Tuesday, first reported by the Financial Times. Unvaccinated employees will be required to work remotely.

Legal liability The Equal Employment Opportunity Commission issued guidance last month that employers can re-

ISTOCK

As Wall Street requires vaccines in return to work, will other employers follow?

quire employees to be vaccinated and offer incentives for them to do so, with a requirement that accommodation is offered to people with a disability or religious objection.

But there are considerations beyond legal liability.

“There’s fear you could lose people,” said James Grasso, a partner with employment law firm Phillips Lytle. “Beyond that, there is a moral issue, where employers do not want to seem too overbearing.”

Conversely, firms could feel pressure from staff to require vaccines.

That was the case for asset manager BlackRock, which said that it would require vaccination for anyone returning to the office after receiving feedback that the mandate would help workers feel better returning to work, Bloomberg reported.

About 71% of state residents 18 and older have had at least one dose of a Covid-19 vaccine. The high vaccination rate makes the decision easier for some employers, said Brian Kropp, research leader for the HR practice at Gartner.

“Employers may say, ‘Yes, we need to keep thinking about being safe,’ but the vaccine rate is so high that there is not really a need to mandate vaccination,” Kropp said.

But the situation gets more complicated for companies with a workforce spread through several states, where vaccination rates can vary significantly, he added.

Rather than a mandate, some companies offer a reward: Employees who are vaccinated get cash bonuses or extra vacation days.

At Facebook, employees who vol-

REAL ESTATE

untarily show proof of vaccination will no longer be required to wear a mask in the office or maintain physical distance, spokeswoman Jamila Reeves said.

Vaccine requirements have popped up in some job listings. That includes at The Related Cos., the real estate firm best known for developing Hudson Yards. A line at the end of several job posts on the firm’s website said staff working on-site must be fully vaccinated, outside of legal exemptions. The company did not respond to multiple requests for comment on the listings.

SmartAsset, a startup that connects consumers with financial advisers, has taken its workforce of about 200 completely remote during the pandemic—dropping its lease for a Financial District headquarters. The company has started organizing some in-person gatherings in the past month, with a requirement that employees attend only if they have been vaccinated.

On the heels of a $110 million funding round, CEO and co-founder Michael Carvin said SmartAsset will eventually have an office again for flexible attendance. But—vaccine requirement or not—he said firms are making a mistake if they force staff back to the office regularly.

“The one thing you should not be doing in 2021 is trying to go back to 2019,” Carvin said. “The workplace has changed.” ■

WEBCAST CALLOUT

Witnick Real Estate scoops up Union Square property for $24M

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itnick Real Estate Partners has spent $23.5 million to purchase an apartment building near Union Square, continuing its recent buying spree of residential buildings in the city.

The company, co-founded by Isaac Abraham and Rami Ben-Yehuda, is the new owner of 30 E. 14th St. in Manhattan. The firm bought it

tial units, and it spans about 21,000 square feet, according to city records. Apartments in the building have recently rented for between $3,000 and $4,660, according to StreetEasy.

Representatives for Witnick declined to comment on the purchase, and representatives for Jenel did not respond to a request for comment.

Abraham and Ben-Yehuda founded Witnick in 2014 with an initial focus on buying Brooklyn properties. Abraham told Crain’s at the time that the firm hoped to eventually expand into Manhattan, and the company has since followed through on that hope, buying multiple properties in the borough in recent years.

These include rental buildings at 248 Elizabeth St. in Nolita, which Witnick bought for $8 million at the

APARTMENTS IN THE BUILDING HAVE RECENTLY RENTED FOR UP TO $4,660 from entities linked to Jenel Management Corp. that had owned the building since at least 1990, property records show.

The Union Square building stands 5 stories tall with 20 residen-

JULY 15 CRAIN’S 2021 EXCELLENCE IN DIVERSITY & INCLUSION AWARDS

UNION SQUARE beginning of 2020; 227 E. 59th St. in Lenox Hill, which the company bought for $17.5 million in early 2020; and 212 Lafayette St. in Soho, which the company bought for $13.4 million in 2019.

Other recent investment sales in Manhattan include the Chapman

ISTOCK

BY EDDIE SMALL

Group’s purchase of two commercial buildings on East 62nd Street for $35 million, the Davis Cos.’ completion of its $62.5 million purchase of 155-165 W. 29th St. and EJS Development’s purchase for about $32.4 million of 1309 Third Ave. and 202 E. 75th St. ■

Crain’s first Excellence in Diversity & Inclusion Awards, a component of Crain’s 2021 All Together commitment, will celebrate New York City individuals and businesses that are leading by example and holding themselves and others accountable for diversity and inclusion initiatives.

Attend this recognition event and join Crain’s in our commitment to celebrate diversity and cultivate a culture of belonging in New York City.

VIRTUAL EVENT 3:30 to 5:00 p.m.

CrainsNewYork.com/ DiversityEvent

Vol. 37, No. 25, June 28, 2021—Crain’s New York Business (ISSN 8756-789X) is published weekly, except for no issue on 1/4/21 and 12/27/21, and combined issues on 6/28/21, 7/12/21, 7/26/21, and 8/9/21 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.

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2 | CRAIN’S NEW YORK BUSINESS | JUNE 28, 2021

BUCK ENNIS

ARTS & CULTURE

DANCE THEATRE of Harlem got a $10 million grant.

MacKenzie Scott spreads her wealth among the city’s arts institutions The philanthropist donated to the Dance Theatre of Harlem and others

BY CARA EISENPRESS

W

hen pandemic regulations shut down the performing arts industry in New York, the Dance Theatre of Harlem had financial reserves

of just $200,000.

MacKenzie Scott, philanthropist and exwife of Jeff Bezos, recently surprised the ballet company and school with a $10 million gift.

“It’s astonishing to be 52 years old and never have had any reserves,” said Anna Glass, the company’s executive director.

Glass’ organization is one of 53 recipients that are either based in New York City or have offices or major programs in the five boroughs—nearly 20% of the 286 organizations that received a total of $2.7 billion from Scott.

Individual gift amounts were not published, but Scott said they were “relatively large” in order to convey her trust and to enable the organizations to do real work.

“IT’S ASTONISHING TO BE 52 YEARS OLD AND NOT HAVE ANY RESERVES” Scott said she and Dan Jewett, her husband, had spent the first quarter of the year with researchers and advisers looking for “equity-oriented nonprofit teams working in areas that have been neglected.”

The city-based recipients include The Studio Museum in Harlem, The Door youth organization, the Museum of Chinese in America, the Urban Bush Women dance company and Hostos Community College, which is part of the City University of New York.

19% OF THE ORGANIZATIONS FUNDED IMPACT THE CITY Percentage of organizations based in, or impacting NYC NYC organizations 19%

Ambitious futures “This is allowing nonprofits—the small ones in particular—to be able to embrace ambitious futures where they can have far greater impact, and to fund that future,” said Jayme Koszyn, founder of Koszyn & Co., which specializes in fundraising and planning for nonprofits.

At the Dance Theatre of Harlem, Glass has scraped together work and funding See GRANTS on page 26

Non-NYC organizations 81%

SOURCE: Medium

JUNE 28, 2021 | CRAIN’S NEW YORK BUSINESS | 3

WHO OWNS THE BLOCK

18 NINTH AVE.

A PIONEERING MEATPACKING DISTRICT HOTEL IS STAYING PUT But the former epicenter for Manhattan nightlife may be mellowing

BY C. J. HUGHES

M

29–35 NINTH AVE. The Astor family controlled much of the neighborhood from 1819 to the 1920s. This 6-story former warehouse, which has stored wine, syrups and ribbons, was constructed in 1903 and, like most of the Meatpacking District, is part of an 18-year-old historic district. The Jaffe family sold the building for $8.1 million in 2001 to a group of investors that included the firms J.R. Daly & Sons and CB Developers; two years later an outpost of Soho House, a global chain of membership clubs, opened here.

Among its amenities is a rooftop pool. In 2012 Yucaipa Cos., a California investment firm, snapped up a majority stake in Soho House, including the New York location, which went for $82 million, records show. Today there are 28 Soho Houses with 119,000 members, although the company hemorrhaged $235 million in 2020 as the pandemic raged. Membership Collective Group, its parent company, announced this month that it is planning an initial public offering to raise funds.

416 W. 13TH ST. This 3-story, neoclassical building, completed in 1902, was originally the printing plant for P.F. Collier and Son, publisher of Collier’s magazine.

General Electric owned the building in the 1930s.

But in a sign of how the neighborhood’s fortunes declined, the 144,000-square-foot structure was seized by the city in 1985 over unpaid taxes; it was auctioned off a few years later. Since 1995 the office building has been owned by Greenway Mews Realty, a limited liability company that owns nearby properties, although values aren’t what they used to be. In the most recent city assessment (which can be far less than what buyers actually pay), the buff-brick building was worth about $48 million, down from $62 million a year ago, but in line with its 2018 assessment.

52 GANSEVOORT ST. The 2-story brick structure, owned by Aurora Capital Associates—the developer of nearby 40 10th Ave.—is home to Pastis, a restaurant with a long, if interrupted, history in the neighborhood. It first opened around the corner at 9 Ninth Ave. in 1999, a time when it was common to see blood from meat processors spill into the streets. But in 2014 a rent dispute led to Pastis’ closing at that original location. The same year Restoration Hardware, a furnishings chain, signed a $250 million deal for the space, which is controlled by Aurora and William Gottlieb Real Estate. It’s now known as RH New York, a 6-story, 90,000-square-foot retail space that offers a restaurant of its own.

4 | CRAIN’S NEW YORK BUSINESS | JUNE 28, 2021

1 LITTLE W. 12TH ST. Three adjacent prewar brick buildings, which once stored groceries and meat, are joined as a single tax lot that’s owned by William Gottlieb Real Estate, a high-profile local landlord. The firm’s namesake, who began investing in the rough-edged neighborhood in the 1950s, purchased the site for $3.1 million in 1998 from Richard and Peter Kleinknecht, the owners of an electrical company. A year later Gottlieb died from a stroke, which led to a years-long battle among Gottlieb’s heirs over control of his estate. One of WeWork’s early New York coworking outposts opened here in 2012 but closed in January of this year. Since 2008 the ground-floor berth facing Ninth Avenue had featured Bagatalle, a rollicking French restaurant that went on to become a global chain with locations in Dubai, Tulum and London. But the original Meatpacking location is officially closed, a woman answering the phone there said.

675 HUDSON ST. This 5-story, flatiron-shaped building, which was developed around the Civil War as a lock factory, has cycled through various bars and restaurants through the years, each a bit more upscale than the last. The Hog Pit, a honky-tonk that occupied the West 13th Street corner for about a decade starting in the 1990s, shuttered in 2009 after the rent was increased to $40,000 a month, according to news reports. Today the redbrick complex is home to Kobrick Coffee Company, which sells espressos by morning and Negroni cocktails at night. A location of Dos Caminos, a Mexican chain, is also on-site. The landlord is David Ellis Real Estate, which has owned the building since 1973. It also has five apartments and a rooftop billboard. Ellis had a brush with fame in 2016, when a tenant at a building it owns at 21 E. 16th St.—the award-winning Union Square Café—was forced to move after what the restaurant described as an unreasonable rent increase.

Since 2017 the café has been at 101 E. 19th St.

345 W. 13TH ST. Three decades ago, when the Meatpacking District was industrial, people often lived illegally in lofted former warehouses; the zoning didn’t allow for many apartments anyway.

Last year the population of the neighborhood was 7,141, according to the local business improvement district, which oversees the swath from Horatio Street to West 17th and from Eighth Avenue to the Hudson River. (But there are 14 coffee shops, according to the district, or 1 for every 510 residents.) If there are apartment buildings, they tend to be on the edges, like this 7-story, cornice-topped 1890 factory that was converted to a 46-unit condo in 1999. In May a three-bedroom unit with exposed beams there, No. 4F, sold for about $6.4 million, which was the price in February, when it went on the market.

18 NINTH AVE. Since 2004 this site, a former parking lot, has been home to the hotel Gansevoort Meatpacking NYC, an early hospitality offering in an area once thick with slaughterhouses and warehouses. The hotel’s developer was WSA Management, a Long Island–based firm owned by the Achenbaum family, which operates the 186-room property today. But in a complicated arrangement that is typical for New York hotels, the land beneath the glassy high-rise is owned by BD Hotels, a firm co-led by Richard Born that has stakes in dozens of New York properties. BD bought its stake for $9.5 million from Broadway Management in 1999 and leases the ground to the Achenbaums today. Rooms start at $535 per night. Some billboards on-site also generate revenue.

BUCK ENNIS, GOOGLE MAPS

anhattan’s Meatpacking District, once a riotous nightlife hub, continues to reel from the pandemic. But a hotelier is pushing ahead with an extensive renovation all the same.

Gansevoort Meatpacking NYC, whose opening in 2004 fueled the neighborhood’s turn from an industrial backwater, is not packing its bags. As part of a multimillion-dollar effort that will play out over several years, the 186-room hotel is adding art to its lobby, creating a new basement amenities space and making a fine-dining restaurant out of a once-rowdy club.

Whether tourists will flock there, though, remains an open question. Vacancies continue to pock the neighborhood’s stores, and the hotel industry isn’t expected to fully recover for years.

Michael Achenbaum, president of the Gansevoort Hotel Group, suggested this month that his hotel, developed for $70 million, was anticipating a mellower future than its former latenight vibe.

“Our audience has grown and matured, and so has our hotel,” he said.

The project has already delivered freshly wallpapered rooms, a remodeled lobby with deep blue banquettes and a piece by Banksy showing a grinning police officer, and a reinvented penthouse styled with pieces from Italian furniture company Poliform that can be purchased.

In July a pop-up sushi restaurant will open at the refurbished rooftop pool. In 2022 the hotel will add a new restaurant from LDV Hospitality, which operates the Gurney’s resort in Montauk, in a space that contained the Provocateur club until 2017 and bowling and karaoke facilities in the basement.

Chester NYC, the hotel’s bistro-style ground-floor restaurant, will remain.

The Meatpacking District, which had 250 slaughterhouses in 1900, according to the local business improvement district, has just five today, as fashion boutiques, beer gardens and creative-class offices have taken their place. But in recent months the neighborhood has struggled. Washington Street has experienced some of the steepest declines in retail rents in Manhattan, according to a first-quarter report from CBRE. Its asking rents are $413 per square foot, down from $575 per square foot year over year. (Only SoHo’s Prince Street had a worse tumble, to $414 from $683.)

Hotels also had a harsh 2020. The average occupancy rate in December in New York was 36% versus 91% in December 2019, according to NYC and Company, the city’s marketing arm.

But the sector may be on the mend.

Hospitality data firm STR said the city hit a 62% occupancy rate in the second week of June, its highest rate since the pandemic began. ■

TECHNOLOGY

Clear targets billion-dollar IPO value, betting you’ll soon need to skip the airport line

BY RYAN DEFFENBAUGH

N

ew York’s next billion-dollar tech firm could be Clear, the biometric identification company best known for helping travelers skip airport security lines.

The Midtown firm will seek a market value of about $4 billion when it begins selling shares on the New York Stock Exchange, according to a regulatory filing last Wednesday.

The company hopes to raise $376 million by offering 13.2 million shares at a price range between $27 and $30, according to the filing.

Clear underwent a pivot last year, as airport visits sunk in response to the pandemic. It launched Health Pass, which allows office buildings and sports venues to quickly link up biometric identification for a visitor to a recent negative Covid-19 test, a quiz about symptoms and, more re-

cently, vaccination records.

Most of the writing in its IPO, however, focuses on how the firm will boost membership in its central offering, the $179 annual Clear Plus, which gives travelers a quicker trip through airport security.

Despite the pandemic forcing a decline in travel, Clear managed to boost its revenue last year by 20%, up to $231 million, according to its Securities and Exchange Commis-

sion filing. The firm is betting it can increase those earnings—and cut an annual loss that totaled $9 million in 2020—by enrolling new members returning to travel after being vaccinated. The company is pledging to build on its network of 38 airports in the U.S. to enroll more members.

Of course, to get people to pay for a service that skips the airport security line, there first needs to be a line.

Data is trending in the company’s

favor on that point. About 2.1 million travelers moved through airport security checkpoints across the U.S. on a recent Sunday, the Transportation Security Administration reported. That’s a post-Covid high, but it was still down about 20% from the same date in 2019, which was a Thursday.

Clear, which will trade under the symbol YOU, last raised private capital in February. ■

REAL ESTATE

Port Authority inks deal for $145M cargo facility at JFK

BY EDDIE SMALL

A

major construction project is coming to John F. Kennedy International Airport, giving the industry a boost after a historically slow start to the year.

The Port Authority of New York and New Jersey has signed a longterm ground lease with Aeroterm, a firm providing facility-related services to airports across the continent, to develop a $145 million, 350,000-square-foot cargo facility at JFK. This will be the first cargo facility constructed at the airport in 20 years. The initiative is expected to create 350 construction jobs.

The project will demolish two obsolete facilities at JFK and replace them with a modern cargo facility that will feature more than 50 dock doors. Demolition should begin in September, and the project should be finished by the end of 2023, the Port Authority said.

JFK’s main cargo handler, Worldwide Flight Services, will work exclusively out of the facility once it is finished. The airport handled 1.2 million tons of cargo last year, according to Port Authority figures.

Plans for construction projects fell to their lowest level in more than 10 years during the first quarter of this year, with projects spanning roughly 5.4 million square feet overall, the lowest since the fourth quarter of 2010, according to a report from the Real Estate Board of New York.

The agency recently approved a smaller plan to redevelop Terminal 4 at JFK. The pandemic had delayed a planned $3.8 billion expansion, but at its April meeting, the agency authorized a $1.5 billion first phase to redevelop the terminal. The project will add two gates for single-aisle airliners and eight gates for regional jets, among other renovations. ■ JUNE 28, 2021 | CRAIN’S NEW YORK BUSINESS | 5

IN THE MARKETS

Krispy Kreme going public again, but there’s a big hole in company for investors Its doughnuts can do just about everything except make money

KRISPY KREME’S NET LOSSES WIDENED BY 72% IN 2020, TO $64 MILLION

BLOOMBERG

T

he power of doughnuts is cluded $10 million in the past two undeniable. Homer Simp- years to open the “Hot Light Theson sold his soul to the ater Shop” in Times Square. New devil for a scrumm-diddly- York’s post-pandemic future is unumptious one and stopped a run- certain, but Krispy Kreme deems the city “under-penetrataway monorail by aned,” with only eight locachoring a rope to a tions, so the future should doughnut shop sign. contain more doughnuts.

Simpson marveled: Indeed, Krispy Kreme “Doughnuts, is there seems to have visions of anything they can’t do?” becoming a meme stock There is. They don’t ala AMC or GameStop. Its make money. At least, prospectus says 73% of not at Krispy Kreme, customers surveyed this which is preparing to go year would choose Krispy public this week and AARON ELSTEIN Kreme “if they could eat seeks a valuation of $3.9 only one doughnut brand billion.

This would be its second stint as for the rest of their life.”

“We dedicate ourselves to proa public company. The first ended after an accounting scandal in viding the freshest and most awe2004, not long after Krispy Kreme some doughnut experience imagwas featured on the cover of For- inable,” the company said.

Lovers of chocolate-iced and tune and described as “the hottest cream-filled doughnuts may not care, but there’s a big hole in the bull case: The doughnut purveyor doesn’t make any dough.

It has been unprofitable in each of the past three brand in the land.”

The company was acquired in years, and net losses widened by 2016 by private-equity firm JAB 72% in 2020, to $64 million, accordHolding, whose investments in- ing its initial public offering pro-

spectus. Operating cash flow has declined from $148 million in 2018 to $81 million in 2019 to $29 million last year. Sales are growing around a 20% rate, but interest payments on $1.2 billion in debt suck up a lot of Krispy Kreme’s cash. The firm had no comment.

Unprofitable enterprises IPO investors buy shares in unprofitable enterprises all the time,

figuring the company will grow fast.

But Krispy Kreme plans to use its expected $650 million in IPO proceeds first to pay down debt and buy back shares from early investors, according to the prospectus.

The rest, “if any,” will go to build the business. JAB will keep its hand on the wheel, retaining a 77% stake after the IPO. The IPO market is uber-hot, and Krispy Kreme says investors are in-

dicating they’ll pay up to $24 a share, or a whopping 27 times adjusted earnings before interest, taxes and other expenses.

Investors should avoid temptation here. After selling his soul, Simpson’s head was turned into a doughnut he couldn’t resist eating.

“Homer, stop picking at it!” his wife, Marge, ordered.

“Oh, but I’m so sweet and tasty,” he replied. ■

REAL ESTATE

Durst inks deal with automation company to triple space at 1 World Trade Center

A

utomation company Hyperscience is tripling its footprint at 1 World Trade Center, signing a 10-year lease for the entire 88th floor of the famed building, the Durst Organization and the Port Authority of New York and New Jersey announced last Monday.

floors at 1 World Trade Center for prebuilt suites with the expectation of tenant expansion,” Jonathan Durst, president of the company, said in a statement. “This approach has assisted tenants like Hyperscience to quickly set up shop and expand their presence within the building when the time is right.”

Hyperscience has doubled its workforce during the pandemic, and the company signed its new lease with an eye on giving its employees a safe place to resume working together in person if that is what they would like to do, Chief Operating Officer Charlie Newark-French said.

Newmark’s David Falk and Pete Shimkin and the Durst Organization’s Eric Engelhardt and Karen Kuznick represented the landlord, and JLL’s Steven Rotter, Brad Lane and Kyle Riker represented Hyperscience in the deal.

HYPERSCIENCE’S NEW FLOOR WILL INCLUDE ROOM FOR HACKATHONS AND MEETUPS Hyperscience will take 34,382 square feet in the building and plans to move to the 88th floor from its previous space on the 45th floor during the first quarter of next year.

The asking rent was $80 per square foot, and the company’s new office will include a communal area for tech industry events, hackathons, machine learning and customer meetups, the Durst Organization said.

“By design, we set aside specific

Office market woes The pandemic has been brutal on Manhattan’s office market, as

6 | CRAIN’S NEW YORK BUSINESS | JUNE 28, 2021

thousands of the city’s office workers have now spent more than a year working remotely. The borough’s availability rate hit a record high of 17.1% in May—up from 16.5% in April and 10.3% in May 2020—and the average asking rent was $73.26 per square foot, down 7.8% since March 2020, according to a report from Colliers.

Firms leased about 1.5 million square feet of office space in Manhattan last month. Although this was an increase compared with April and May 2020, it was still much lower than the average monthly volume in 2019, about 3.6 million square feet, the report said.

But Durst has still seen some successes during the pandemic despite the overall bleak office market. The company signed a lease with TikTok for 232,000 square feet at One Five One in Times Square in May 2020, and it extended the leases for four of its Midtown East tenants that summer. The law firm Jenner & Block signed a 15-year lease for 67,000 square feet at Durst’s 1155 Sixth Ave. in March as well, downsizing from the 79,000 square feet it had at SL Green’s 919 Third Ave. ■

1 WORLD TRADE CENTER

BUCK ENNIS

BY EDDIE SMALL

TECHNOLOGY

BY RYAN DEFFENBAUGH

S

ome apartment tours are staying virtual. Office landlords are launching apps to monitor air quality and connect with tenants. Employers are hunting for software that connects remote workers with those in the office.

The unusual demands of Covid-19, and the hope for an economic recovery to follow, have driven demand for new technologies in the old-fashioned real estate business. In the latest sign of that de-

the U.S. real estate industry has historically been slow to adopt technology—but that has been changing in the past few years. Covid-19 accelerated that transition.

“This was really kind of like pouring gas on the fire,” Block said.

One recent example is Latch, a Manhattan-based startup that has designed smart locks that can be opened by phone. The company was acquired and taken public through a special purpose acquisition company by Tishman Speyer in a roughly $1 billion deal that closed earlier this year.

The deal is representative of how major commercial landlord and real estate management firms are increasingly looking to startups to add to the suite of technology products they offer tenants. Latch is focused on the residential market, but recently it began installing its locks in some office buildings—including those owned by Tishman Speyer.

MetaProp can act as a go-between: Major real estate firms invest in the company’s fund, which then

“THE STUFF THAT IS REALLY TAKING OFF NOW IS TENANTENGAGEMENT TECHNOLOGY” mand, New York–based venture capital investor MetaProp said last Monday that it had successfully raised $100 million to invest in early stage startups focused on real estate, a category known as proptech.

Looking to startups Aaron Block, co-founder and managing partner of the fund, said

BLOOMBERG

Venture firm raises $100 million to help real estate companies embrace tech

finds and invests in emerging real estate technology companies. Some of MetaProp’s investors include CBRE, Cushman & Wakefield and JLL’s Spark fund. Those partners allow MetaProp to offer startups a “pilot- and test-ready sandbox of 15 billion square feet across every real estate asset type,” according to a description from the firm.

MetaProp invests between $750,000 and $1.5 million in startups—whatever is enough to help build a concept or product into a growing company.

The investment firm also runs an accelerator program with Columbia University that provides seed investment and mentoring for proptech startups. Among the program’s graduates is Bowery Valuation, which uses technology to appraise commercial buildings and has raised nearly $20 million from investors.

Worker return Block said the gradual return to the office has created an opportunity for startups—landlords are

looking for tools that encourage workers to come back to the desks their bosses are paying for.

“There was at first a knee-jerk reaction toward things that make people comfortable, like thermal scanners and touchless technology,” Block said. “But the stuff that is really taking off now is tenant-engagement technology.”

Office owners have traditionally communicated only with a tenant's office manager or operations officer, but Block said commercial-property owners now want ways to engage directly with tenants. MetaProp is invested in HqO, a Boston-based firm whose app allows landlords to push alerts to workers in its buildings and share updates on amenities and events.

Climate tech, such as startups that help building owners reduce their emissions, also is heating up.

Part of that is driven by local mandates to cut emissions or face fines.

The city's Local Law 97, for example, requires building owners to decrease emissions 40% by 2030.

This is the third fund raised by MetaProp since it was founded in 2015. Its previous fund closed at $40 million. ■

CRAIN’S WEBCAST —

IAN DUNCAN BALL

STRATEGIC

LESSONS FROM A TRANSITION JOURNEY MAEVE DUVALLY, a communications executive at Goldman Sachs, joined Frederick P. Gabriel Jr., publisher and executive editor of Crain’s New York Business, for the Building a Network With Pride event June 24 to speak about her gender transition journey and how she has navigated the change at one of the city’s top financial firms. DuVally provided insight for those who are going through a similar process and shared what employers can do to support their workers, transitioning or otherwise.

• DuVally, who realized she was transgender in October 2018, recommended that those transitioning, or struggling with other issues, find a therapist. “There are very complex feelings associated with it, and you just need professional help,” she said.

• DuVally shared that, at Goldman Sachs, she had a “relationship manager” from the diversity and inclusion department, who helped her strategize her coming out.

• For smaller businesses trying to be supportive of those transitioning, DuVally said, “The companies have to ask for help and figure out what the best practices are and just really try and be encouraging, supportive to the employee. If they do that from a place of kindness, I’m pretty sure it’s going to turn out OK.” — Gabriel Poblete

business advice from experienced A&E advisors will add certainty to your future. grassicpas.com/ae

JUNE 28, 2021 | CRAIN’S NEW YORK BUSINESS | 7

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

EDITORIAL

publisher/executive editor

Tackling these issues should be first on the next mayor’s to-do list

1. CRIME. As the City That Never Sleeps reawakens, the next mayor will need to ensure that the streets are safe and welcoming—for residents and tourists. For the past several months, news stories about gunplay, violence in the subway system and attacks on New Yorkers of Asian descent have reverberated around the world. For the city to rebound, it will need to fill hotels, restaurants and Broadway theaters with visitors from across the globe.

But they won’t come back until it’s safe for them to do so. Tourism aside, for the city to see its office corridors teeming with workers again—the very workers who patronize small local businesses during their lunch breaks—New York will need to prioritize keeping the transit system free of crime.

The next mayor will have to build a rapport with the Police Department that allows officers to feel respected but keeps certain communities from feeling targeted.

2. AFFORDABILITY. The latest report from Douglas Elliman listed the

EDITORIAL editor-in-chief Cory Schouten editor Robert Hordt assistant managing editors Telisha Bryan,

Janon Fisher

average rent for a Manhattan studio at $2,475. A number of New Yorkers waited out the peak of the crisis in other places, and they probably didn’t miss their Big Apple rent bills one bit. Skyrocketing rents could play a role as workers who now can do their job remotely decide whether to come back. Remote workers tend to be better paid than those who need to head into work, such as drugstore, supermarket and restaurant staff. We thanked those workers profusely during the height of the crisis for staying on their post and providing essential services. Now it’s time to make sure they have a central place to live and raise a family that doesn’t require them to be packed onto a crowded train for hours each way.

deputy digital editor, audience & analytics

Jennifer Samuels

GRACIE MANSION

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 NEWSCOM

I

t’s still unsettled who will live in Gracie Mansion next year, but it is clear that whoever becomes the next mayor will have to manage a city in crisis. Here are the issues he or she should tackle on day one.

Frederick P. Gabriel Jr.

city’s shelter population can find jobs and homes.

Johnson & Johnson is a massive selling point.

212.210.0100 685 Third Ave., New York, NY 10017-4024 ADVERTISING

www.crainsnewyork.com/advertise account executives Kelly Maier,

Courtney McCombs, Christine Rozmanich,

3. HOMELESSNESS. Homeless New Yorkers are New Yorkers—some of whom lost their job during the pandemic. They deserve a safe place to eat and sleep. They need places to go during the day so they aren’t congregating outside businesses and in the subway system. The next mayor should prioritize social services for the mentally ill homeless and those with substance-abuse issues that can get them reacclimated into society. And he or she should create programs to ensure the

4. LIFE SCIENCES. New York has a marquee opportunity to further make a name for itself as a hub for health care development and technology. Mayor Bill de Blasio recently pledged to double the city's initial investment in its LifeSci initiative, for a total of $1 billion in the next decade. The next mayor should take advantage of this funding boost and make relationships that lure firms in the field away from the West Coast and Boston. The metropolitan area being home to Pfizer and

5. BUSINESS RESTRICTIONS. Many small businesses were crushed by the fallout of the pandemic shutdowns, but the crisis also provided the impetus for some new ideas. As these startups look for funding, office space and a workforce, the last thing they should be greeted with is red tape that drives them to incorporate elsewhere. The next mayor should make the city a more welcoming place for entrepreneurs by nixing policies that make doing business here onerous. ■

Laura Warren people on the move manager Debora Stein,

dstein@crain.com CUSTOM CONTENT senior manager, custom content

Sophia Juarez, sophia.juarez@crainsnewyork.com EVENTS

www.crainsnewyork.com/events manager of conferences & events

Ana Jimenez, ajimenez@crainsnewyork REPRINTS director, reprints & licensing Lauren Melesio,

OP-ED

212.210.0707, lmelesio@crain.com

Council bill aimed at helping MWBEs could end up harming them

PRODUCTION

BY KENNETH THOMAS

O

ne step forward . . . two steps back.

A City Council bill, introduced by the public advocate, aims to establish a more rigorous licensing program for all general contractors, ostensibly to hold them more accountable for what happens on their projects.

On its face, this sounds like a worthwhile policy in the spirit of

neer a safer construction industry in this way could render it harder for minority and women contractors—subs and general—from competing in an industry that already marginalizes them.

Structural barriers Lack of operational capacity has long been an albatross dangling around the necks of minority- and women-owned business enterprises. Limited access to capital to fund payrolls and pay suppliers or insufficient (or nonexistent) insurance and bonding constrains MWBEs from being able to complete in a timely fashion onerous pre-qualification documentation or implement comprehensive safety rules.

MWBEs already face myriad structural barriers from being able to effectively bid on, win and exe-

AS IMPORTANT AS SAFETY IS THE GOAL OF INCREASING CONTRACTOR DIVERSITY increased transparency and safety for the industry. That said, as with most legislation, there are unintended consequences that the policymakers probably didn’t account for. In short, attempting to engi-

cute contracts. This is hardly restricted to just the construction industry, and it is no secret. A Crain’s article from June 2020 even highlighted how lack of capacity prevents MWBEs from winning contracts.

This legislation will add yet another variable to contend with. If general contractors would be required to have a “designee” (essentially a personal guarantor that owns at least 10% of the firm) to file a permit on the company’s behalf and be held responsible for all the work performed by subcontractors, then a subsequent consequence could be the general contractors' placing an even more stringent methodology on the vetting of the subs they’re considering on their projects.

Lingering stigma MWBEs, with the lingering stigma that they’re not fully equipped to perform on these projects,

would be the first to be excised from consideration, and the legitimate excuse—afforded by this bill—could be attributed to “enhanced risk management protocols” needed to mitigate liability.

Here we have an unintended consequence that could reverberate throughout the industry. It’s a regressive bill in that it will undermine the progress being made by the MWBE subs. What we need are more carefully curated policies to reinforce safety, not cumbersome “catch-alls” that overwhelm the most vulnerable in the process.

Safety on construction sites should be a paramount concern, but such a goal needn’t be mutually exclusive from an equally important goal of increasing contractor diversity on these sites. ■

production and pre-press director

Simone Pryce media services manager Nicole Spell SUBSCRIPTION CUSTOMER SERVICE

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Entire contents ©copyright 2021 Crain Communications Inc. All rights reserved. ©CityBusiness is a registered trademark of MCP Inc., used under license agreement.

CRAIN COMMUNICATIONS INC. chairman Keith E. Crain vice chairman Mary Kay Crain chief executive officer K.C. Crain senior executive vice president Chris Crain secretary Lexie Crain Armstrong editor-in-chief emeritus Rance Crain chief financial officer Robert Recchia founder G.D. Crain Jr. [1885-1973] chairman Mrs. G.D. Crain Jr. [1911-1996]

Kenneth Thomas is co-founder of the Minority & Women Contractors & Developers Association.

8 | CRAIN’S NEW YORK BUSINESS | JUNE 28, 2021

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6/25/21 4:39 PM

OP-ED

BY RANDY PEERS

A

s the city’s economy has slowly reopened, the media, thought leaders, elected officials and business owners have opined extensively on the plight of small businesses. It is widely agreed that small businesses suffered tremendously as a result of pandemic restrictions. Many positive steps were taken to attempt to offset both lost revenue and costs of doing business.

But if we are truly serious about creating an environment in the city where entrepreneurs, new immigrants and people with individual passions can build a business that provides services to our communities and creates jobs for our neighbors, we really need to address another burden that businesses faced even before the pandemic-detrimental costs associated with fines and violations.

Enforcement of codes and regulations is a critical role of government, especially when it comes to keeping communities healthy and safe. This is not a sweeping call to eliminate the work of investigators from city agencies; this isn’t a license for bad actors to avoid accountability. But there are too many petty nuisance citations that can be resolved without punitive financial measures against business owners.

Actions tend to be coordinated and in waves—whether it be a blitz against local businesses, such as a barbershop that isn’t posting its price list; nonpermitted exterior signs that, along with costing the price of the fine, can top several thousand dollars to remedy; scaffolding regulations; or antiquated blue laws.

All talk For years, elected officials and candidates have vocally supported solutions to move government out of the way of small businesses. In 2015 Comptroller Scott Stringer convened a Red Tape Commission that released a plan with 60 recommendations that took aim at everything from reducing the amount of time required for the approval of permits and better customer service training for those interacting with city agencies to new regulations around scaffolding. In 2012 then-Public Advocate Bill de Blasio sued the city in a bid to determine the extent soaring fines were hurting small businesses.

Commissions, task forces and committees have proliferated at all levels of government. Yet little has been done to curb the collection of fees from fines and violations. As the Citizens Budget Commission points out, from 2010 to 2020, revenue from fines and violations increased at an annual rate of 2.6%,

and it is now almost $1.1 billion.

Fees and permits increased even more—3.7% annually, resulting in almost $700 million collected. As a comparison, the annual rate of inflation in the same time was 1.6%.

That's proof of a disconnect— and a problem.

With significant changes coming to city government in the coming elections, elected officials and agency leaders should be committed to ending the talk and taking action on excessive fines and violations. It’s time to be bold.

The next mayor should set targets at the agency level to reduce fines and violations—25% would be a good start. At the same time enforcement staff needs to be retrained and refocused. These are not debt collectors. They should be nimble and ready to provide onthe-spot education and technical assistance. Agencies that fail to meet their goals for reductions should see their enforcement budgets cut, meaning reducing the number of full-time employees.

This is not meant to be punitive.

Streamline If agencies can’t stop giving out excessive fines, we can only meet the need by having fewer people.

Another source of inequity is unfunded mandates. The City Council can pass legislation that prescribes new regulations or standards,

GETTY IMAGES

New York City must ease fines and fees on small businesses

which usually include a new permit or violation. (Just look at the Fair Work Week laws enacted by the City Council in 2019 as one example.)

Often they take effect before they have been properly disseminated to affected industries—setting business owners up to fail.

A step in the right direction: Require the elimination of an antiquated violation to coincide with legislation that imposes new requirements—ensuring a true zero-sum outcome.

Navigating the labyrinthine structure of city government is often a significant factor in deterring potential business owners from go-

ing out on their own. Innocuous fines and petty violations go at the pockets of business owners who have successfully jumped through the initial set of hoops. Let’s keep more money with our small businesses while at the same time educating them on more nuanced points of codes and standards.

This will give business owners more confidence in government at a time when many are looking for leadership and a commitment to Main Street. ■ Randy Peers is president and CEO of the Brooklyn Chamber of Commerce.

OP-ED

BY ERIC LEE

T

he pandemic has brought home the starkly unequal terms of employment for many New Yorkers. While working exceptionally hard and showing remarkable stoicism, service workers have endured shockingly inadequate earnings.

It must be our job to build a more equitable economy in the city. Our best first move will be to leave behind the old-fashioned idea of the unskilled worker. Instead of imagining that some among us are unqualified and destined to be that way far into the future, we can drive economic growth by placing skill building for all New York workers at the heart of our ambitions.

The idea of the unskilled worker is a leftover from the economic trauma that came as New York shifted from an industrial economy to one where knowledge work and service jobs drove job creation. The city was an industrial powerhouse in the 20th century, making products for local, national and international markets and generating great wealth. Pitched battles to unionize these jobs meant that workers did well too: At mid-century, the city had more than a million manufacturing jobs, many of them

paying well.

Today these jobs are largely gone.

The idea of the unskilled worker took hold from efforts to solve the resulting employment crisis. This idea remains a fixture in economic policymaking and holds back our progress toward building a fair, more equal economy in the city.

No return Conversations contemplating the return of manufacturing as a large part of the city’s economy continue to occupy primacy of place in policy circles—generating special tax breaks, antediluvian land-use restrictions, reports from think tanks and the attention of city policymakers. This is deeply misplaced energy: What manufacturing there is in the city is limited in the extreme and delivers less than 2% of all jobs there.

Equally, talk about accommodating unskilled workers in economic development policy normalizes the deeply inadequate results of our public education system. Just about half of working New Yorkers do not have any college education at all (including those who have not graduated from high school). New Yorkers with the least formal education are starkly concentrated among Black and Latino New York-

ers. City schools have made progress in high-school graduation rates and in college readiness—yet millions of working-age New Yorkers do not have formal education beyond the high-school level. The problem isn’t the students.

This points us to the third problem of thinking about unskilled workers. We tolerate the false notion that for hundreds of thousands of New Yorkers, their working lives should be conceptualized as unskilled. When we do so, we overlook the ambitions of our neighbors while neglecting the urgent need for skilled workers in many fields.

If changing how we think about our workforce is a first imperative, the second is building a new system to support how New Yorkers develop skills. The existing workforce training infrastructure falls short.

Apprenticeships that are offered to secondary school students through the city schools are available for hundreds of students every year, but the demand is in the tens of thousands.

For people who have completed high school or who are older, social entrepreneurs have built programs that deliver highly effective skills training, directly tied to the needs of employers—yet these programs have not been taken to scale. Pri-

BLOOMBERG

Don’t call them unskilled workers

vate skills-training companies have stepped in to meet the demand for skill-training among working-age New Yorkers, although most of these offerings are expensive and too many are ineffective.

Ambition and skills Ours is a city divided by earnings, by a yawning skills gap and by the expectations we hold for one another. Extraordinarily skilled workers from all over the United States and the world come to the city and put their ambition and skills to

work. Equally, millions of other New Yorkers lean into their jobs, sharing an ambition for meaningful work, for the opportunity to advance, to test their gifts and to provide a comfortable living for their families.

To these workers, we must also say yes. ■ Eric Lee is the founder of the New York City civic consulting firm Bennett Midland and a former senior aide to former Mayor Michael Bloomberg.

JUNE 28, 2021 | CRAIN’S NEW YORK BUSINESS | 9

P009_CN_20210628.indd 9

6/24/21 2:50 PM

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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Rarely has the value of both been more strongly felt than in recent structure. They represent an extraordinary group of professionals from months. From stress-tested balance sheets to fast-changing regulations, firms of varying size and renown.

To find these honorees, Crain’s consulted with trusted sources in the and reconfigured supply chains to “new normal” working arrangements, business world in general and in the accounting and consulting realms in the Covid-19 pandemic has challenged even the strongest of businesses.

Standing tall within this chaotic breach are the foot soldiers of profes- particular. The nominations submitted by individuals and firms in the New Few qualities are more vital to the health of any business than financial experts in tax regulation, audit, estate administration, forensic accounting, York metropolitan area were rigorously vetted. Ultimately, each of the acsional service firms, led by accountants and management consultants. organizational transformation, advisory services, fundraising and business equilibrium and organizational efficiency.

In selecting the 86 honorees for this year’s list of Notable Women in counting and consulting notables was chosen for her career achievements Rarely has the value of both been more strongly felt than in recent structure. They represent an extraordinary group of professionals from Accounting and Consulting, Crain’s sought to spotlight the accomplished and involvement in industry and community organizations—and at times and renown. months. From stress-tested balance sheets to fast-changing regulations, firms of varyingI size 28, 2020 I to help New York rebound SEPTEMBER from the coronavirus. metropolitan area professionals and problem-solvers who keep business- her effortsCRAINSNEWYORK.COM To find these honorees, Crain’s consulted with trusted sources in the and reconfigured supply chains to “new normal” working arrangements, Read their biographies and learn how the members of this remarkable es churning. The talented individuals presented here are a diverse group, business world in general and in the accounting and consulting realms in the Covid-19 pandemic has challenged even the strongest of businesses. skilled at resourceful innovation and disruptive thinking. These women are cohort keep the gears of business whirling.

The nominations by individuals andadministration, firms in the New Standing tall within thisqualities chaoticare breach soldiersofofany profesexperts insubmitted tax regulation, audit, estate forensic accounting, Few moreare vitalthetofoot the health businessparticular. than financial York metropolitan organizational area were rigorously vetted. Ultimately, each of the acsional service firms, led by accountants and management transformation, advisory services, fundraising and business equilibrium and organizational efficiency.consultants. counting and consulting notables chosenan forextraordinary her career achievements In selecting the 86 honorees for this list been of Notable structure.

They was represent group of professionals from Rarely has the valueyear’s of both more Women stronglyinfelt than in recent andregulations, involvement infirms industry and community organizations—and at times Accounting and Consulting, Crain’s sought to spotlight the accomplished of varying size and renown. months. From stress-tested balance sheets to fast-changing efforts to help New from theCrain’s coronavirus. metropolitan area and professionals andsupply problem-solvers businessTo York find rebound these honorees, consulted with trusted sources in the reconfigured chains to who “newkeep normal” working her arrangements, Read their biographies learn how theand members this remarkable es churning. The talented individuals presented here are diverse group, of businesses. businessand world in general in the of accounting and consulting realms in the Covid-19 pandemic has challenged aeven the strongest cohort the gears of business whirling. submitted by individuals and firms in the New skilled at resourcefulStanding innovationtalland disruptive thinking.

Theseare women aresoldiers particular.

The nominations within this chaotic breach the foot of keep professional service firms, led by accountants and management consultants.

In selecting the 86 honorees for this year’s list of Notable Women in Accounting and Consulting, Crain’s sought to spotlight the accomplished metropolitan area professionals and problem-solvers who keep businesses churning. The talented individuals presented here are a diverse group, skilled at resourceful innovation and disruptive thinking. These women are

LAURA PETERSON

York metropolitan area were rigorously vetted. Ultimately, each of the accounting and consulting notables was chosen for her career achievements and involvement in industry and community organizations—and at times her efforts to help New York rebound from the coronavirus.

Read their biographies and learn how the members of this remarkable cohort keep the gears of business whirling.

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

LAURA PETERSON

Laura Peterson’s résumé lists a whopping 10 positions she’s held at the multinational professional services company Managing Director and Communications, Media and Technology Northeast Business Leader Accenture since joining the firm in 2000. In her current role as Accenture the Northeast business lead for communications, media and technology, the enterprising ladder climber presides over a team Laura Peterson’s résumé lists a whopping 10 positions she’s of 3,000 professionals. Peterson is charged with managing a $750 held at the multinational professional services company andinCommunications, Media and Technology Northeast Business Leader million profit-and-lossManaging statementDirector for clients the Accenture since joining the firm in 2000. In her current role as aforementioned sectors as well as the high tech sector. Peterson Accenture the Northeast business lead for communications, media and works with key business leaders among more than 40 clients and technology, the enterprising ladder climber presides over a team Laura Peterson’sstructure. résumé lists a whopping within Accenture’s global management Since 2017, she 10 positions she’s of 3,000 professionals. Peterson is charged with managing a $750 held the multinational professional company has been a board adviser to at Fairygodboss, an online platformservices that million profit-and-loss statement for clients in the since joining the firm in 2000. In her current role as seeks to elevate womenAccenture in the workplace. aforementioned sectors as well as the high tech sector. Peterson the Northeast business lead for communications, media and works with key business leaders among more than 40 clients and technology, the enterprising ladder climber presides over a team within Accenture’s global management structure. Since 2017, she of 3,000 professionals. Peterson is charged with managing a $750 has been a board adviser to Fairygodboss, an online platform that million profit-and-loss statement for clients in the seeks to elevate women in the workplace. aforementioned sectors as well as the high tech sector. Peterson works with key business leaders among more than 40 clients and within Accenture’s global management structure. Since 2017, she has been a board adviser to Fairygodboss, an online platform that seeks to elevate women in the workplace.

LAURA PETERSON

PAT WANG Healthfirst

P

INTERVIEW BY JENNIFER HENDERSON

at Wang, president and CEO of Healthfirst, a nonprofit insurer formed by a group of health care systems, had been working to advance value-based care long before the pandemic. The concept involves paying hospitals and physicians based on their patients’ outcomes rather than on the volume of services they provide. Now, as health care providers face unprecedented financial strain due to the Covid-19 crisis, Wang says such payment arrangements are more critical than ever. Not only do they improve the quality of care for patients—including the 1.5 million plan members Healthfirst serves throughout the city, Long Island and surrounding areas—but they also generate fiscal benefit for the facilities, practices and health centers that serve them.

How does Healthfirst contribute to value-based care?

What you understand as profit in another health insurance company’s balance sheet at Healthfirst is contractually-driven surplus that goes back to the delivery system. Eighty percent of the premiums we get for medical services flows through value-based payment arrangements, which means that providers benefit when there is a surplus in the premium. If less money is spent on fee-for-service claims, the surplus is part of the contractually-obligated payment stream.

What has that meant during the pandemic?

For April through June, we are distributing $250 million in those surpluses [about double that of the same period last year], and we’ve expedited the calculation and reconciliation of those amounts to get them out the door faster because the delivery system really needs it.

Why are value-based payments vital now and in normal times?

In the best of times, we have always been trying to push for this model because it aligns the incentives around trying to keep people healthy and avoiding unnecessary care. The providers are aligned with that goal because they benefit from it if they can reduce avoidable care. Consider Covid-19 to be like a war.

In war times, the model has been a lifesaver because there is this artificial depression of utilization, and that’s why the providers have lost so much money—their revenue has dried up. But because we have these risk contracts, the surplus that is there, that’s what has gone out the door to them.

DOSSIER WHO SHE IS President and CEO, Healthfirst AGE 66 BORN Jersey City RESIDES Manhattan EDUCATION Bachelor’s in history and East Asian studies, Princeton University; J.D., New York University School of Law FAMILY MATTERS Wang is married and has one son who lives in Brooklyn.

GLOBAL TIES She has lived in Croatia, Taiwan as well as China, where she had more than 20 first cousins.

FLARE FOR FOOD Wang has become reacquainted with the joy of cooking as a result of the pandemic.

EYE ON MEDICAID About three-quarters of Healthfirst’s members are Medicaid beneficiaries. The insurer’s initial response to the crisis included having its care managers make sure members had medicine and durable medical equipment to stay at home safely.

BUDGET CUTS Wang says the magnitude of the state’s Medicaid cuts—instituted to pare back on spending growth—is devastating. “Cuts to us as a Medicaid plan are cuts to hospitals.”

What happens when patients again begin seeking services?

We do see utilization coming back, and we have been encouraging our members to get needed care because people have put a lot of stuff off. We have to see whether the bounce back is gigantic or it just brings things back to a steady state. If we go back to a more normal utilization pattern, then the regular incentives of trying to align around good preventive care and avoiding unnecessary care, they just kick in.

How can the city safely bounce back from the pandemic?

Continue doubling down on the public health measures already in place: wearing masks, social distancing and hand sanitation. We know what to do. But I think a singular focus on getting the schools open for full learning should top the list of what we are aiming for. We should measure our success against that goal. As an employer, I can tell you that we will not be able to get fully back to work until the thousands of employees with school-age children can get their kids back into school. It’s of course better for all children and particularly critical for poorer children. The city’s economic recovery is going to hinge on how quickly and how well we can get that done so that parents can resume their normal lives too. As a longtime resident of the city who has watched us recover from recession, 9/11 and Hurricane Sandy, I believe in the city’s ability to bounce back against the odds. But this time is going test all of us, and we should be sober about the need for everyone to contribute to the solution.

What challenges face the broader insurance industry?

Balancing the needs and expectations of consumers who need and deserve good health care coverage, expanding access however we can and doing it within an increasingly constrained economic environment. This is especially true with Medicaid, where the state’s budget situation is dire at the same time as people’s needs are increasing. Given that Healthfirst has over 1 million Medicaid members, the potential impact of the state’s budget is especially concerning. For me, our priority has to be enabling as many people as possible to have full access to high-quality care, and it’s going to be a challenge to figure out how to do that in this economic environment. Insurers also need to be mindful of the hurt being experienced by so much of the provider delivery system.

The value of our products relies on having strong doctors, hospitals and community resources. Balancing all of this in a financially viable way is going to be a challenge. ■ Reprinted with permission from Crain’s New York Business. © 2020 Crain Communications Inc. All rights reserved.

Further duplication without permission is prohibited. #NB20080

For more information contact: Lauren Melesio Director, Reprints & Licensing lmelesio@crain.com • (212) 210-0707

Reprinted with permission from Crain’s New York Business.. © 2020 Crain Communications Inc. All rights reserved.

Further duplication without permission is prohibited. #NB20073

New York Institute of Technology has granted tenure and promoted School of Management Assistant Professors Muthuraj Birasnav Muthuraj, Ph.D. and Radoslaw Nowak, Ph.D. to the rank of Associate Professor. New York Tech’s School of Management offers undergraduate and Nowak graduate degrees in business, finance, marketing, business analytics, and more at campuses in New York City, Long Island and Vancouver, Canada. With a curriculum fostering research, inclusivity, and exploration, New York Institute of Technology is highly ranked and accredited, offering 90+ degree programs in high-growth, in-demand fields including engineering, computer and data science, biology/ biotechnology, architecture, business, medicine, health care, and design. Visit nyit.edu.

Gil Mermelstein now leads West Monroe’s East Coast region. He is a managing partner and opened the New York office in 2010, shaping it into a top workplace.

He continues to lead the office and, under his leadership, the office has grown by more than 30% annually over the past five years. With over 25 years of experience, he is a trusted advisor to financial services and private equity clients by executing technology-enabled growth opportunities and transformations. He joined West Monroe in 2010.

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10 | CRAIN’S NEW YORK BUSINESS | JUNE 28, 2021

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REAL ESTATE

Sedesco looks to exchange subway elevators for square footage on Billionaires Row skyscraper $223M

R

eal estate developer Sedesco wants to give the city new subway elevators in exchange for adding 52,000 square feet to its proposed Billionaires Row skyscraper.

The real estate firm is asking to add the floor area at the planned 1,100-foot-high property through the city’s new Zoning for Accessibility program, through which developers can provide major transit improvements for people with disabilities in exchange for more building allowances.

Sedesco has proposed building

tion accessible to people with disabilities,” said Derek Gilchrist, a partner at the firm. “We believe in New York City and are eager to contribute to its recovery as well as make it more accessible for those that live, work and visit here. We look forward to going through the public approvals process and engaging with stakeholders about our plans.”

Under current zoning restrictions, the building bonus is available only on sites adjacent to subway stations in Downtown Brooklyn and in Manhattan’s high-density commercial districts. But if the Zoning for Accessibility changes are approved by the City Council, the program could include sites that are within 500 feet of a station. The Sedesco site is 250 feet from the 57th Street station.

With the additional space, the 63-story building, designed by Dutch architecture firm OMA, would include 119 apartments

AMOUNT Sedesco has spent to buy out a ground lease and purchase the related properties

across 237,110 square feet of residential space. It also would have 205,976 square feet of commercial space for 158 hotel rooms and a 10,212-square-foot restaurant.

Plan A

THE DEVELOPER WOULD TAKE PART IN THE ZONING FOR ACCESSIBILITY PROGRAM two elevators at the southwest corner of West 56th Street and Sixth Avenue that would provide access to the F line’s 57th Street station.

“As part of the development, we are excited to include a commitment to make the 57th Street F sta-

41–47 W. 57th St.

Plan B If the rezoning is not approved, then the plans will be trimmed down to a 385,706-square-foot mixed-use building, the developer said. Construction on the property is scheduled to begin next year, and the building is expected to be operational by 2026.

Since 2012, the developer has spent about $223 million buying out a ground lease and purchasing 41 W. 57th St. and 50 W. 58th St. It received permits to demolish the buildings.

It also owns the 20-story office building at 34 E. 51st St., which it spent $60 million and three years constructing, as well as 7 W. 51st St., 29 E. 61st St. and 26 E. 64th St. ■

DUTCH ARCHITECTURE FIRM OMA

BY NATALIE SACHMECHI

One World Trade Center Congratulates

Leasing Inquiries Eric Engelhardt 212.667.8704 eengelhardt@durst.org Karen Kuznick 212.667.8705 kkuznick@durst.org

David Falk 212.372.2271 dfalk@ngkf.com

ON THEIR EXPANSION TO THE ENTIRE 88TH FLOOR Special Thanks to:

Steven Rotter, Brad Lane, Kyle Riker - Jones Lang LaSalle

“With our employee base having doubled in size during the pandemic, our Leadership Team wanted to enable safe in-person collaboration... and this new space will allow for that and our continued growth.”

Jason Greenstein 212.372.2349 jgreenstein@ngkf.com Peter Shimkin 212.372.2150 pshimkin@ngkf.com Hal Stein 212.233.8185 hstein@ngkf.com

IT’S WHERE DISRUPTIVE THINKERS, FINANCIAL GURUS, GENIUS INNOVATORS, AND START-UP DREAMERS

Charlie Newark-French - COO

JUNE 28, 2021 | CRAIN’S NEW YORK BUSINESS | 11

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THE LIST LARGEST ARCHITECTURE FIRMS Ranked by number of New York–area architects

9 1 1 1 1 11 11 1 3 1 4 1 5 1 6 2 7 2 8 29 21 21 21 21 21 21 21 21 1 1

RAN

(From left) 10 WYTHE AVE. by Gensler (No. 1); RESORTS WORLD CASINO NEW YORK CITY by Perkins Eastman (No. 1); EAST END GATEWAY by Skidmore, Owings & Merrill (No. 3); RJWBARNABAS & RUTGERS CANCER INSTITUTE OF NEW JERSEY by HOK (No. 4); ONE VANDERBILT by Kohn Pedersen Fox Associates (No. 5) COURTESY OF GENSLER, PERKINS EASTMAN, SKIDMORE, OWINGS & MERRILL, HOK, KOHN PEDERSEN FOX ASSOCIATES

RANK

1 1 3 4 5 6 7 8 9 10 11 12 13 13 15

NEW YORK–AREA ARCHITECTS 2020/ 2019

WORLDWIDE ARCHITECTS 2020/ 2019

NEW YORK–AREA SERVICE MIX (% OF BILLINGS) 1 NOTABLE PROJECTS/CLIENTS 2

FIRM/ ADDRESS

PHONE/ WEBSITE

Gensler 1700 Broadway New York, NY 10019

212-492-1400 gensler.com

Robin Klehr Avia, Joseph Brancato Regional managing principals Rocco Giannetti, Molly Murphy, Joseph Lauro, Amanda Carroll Managing directors, NY office

285 290

1,736 1,768

Architecture: 30% 10 Wythe Ave./Cure at 345 Park Engineering: 0% Ave. South Interiors: 67% Planning: 3%

Perkins Eastman 115 Fifth Ave. New York, NY 10003

212-353-7200 perkinseastman.com

Andrew Adelhardt Shawn Basler Nicholas Leahy Co-chief executives

285 271

510 486

Architecture: 67% The David H. Koch Center for Interiors: 29% Cancer Care at Memorial Sloan Planning: 4% Kettering Cancer Center/Resorts World Casino New York City

Skidmore, Owings & Merrill 7 World Trade Center New York, NY 10007

212-298-9300 som.com

Kenneth Lewis, Laura Ettelman Managing partners Chris Cooper, Colin Koop Design partners

186 188

460 455

Architecture: 90% 175 Park Ave./East End Gateway Engineering: 5% Interiors: 3% Planning: 2%

HOK 5 Bryant Park New York, NY 10018

212-741-1200 hok.com

Carl Galioto President, managing principal

163 191

1,043 1,187

Kohn Pedersen Fox Associates 11 W. 42nd St. New York, NY 10036

212-977-6500 kpf.com

James von Klemperer President

136 132

233 228

Architecture: 85% One Vanderbilt/One Madison Interiors: 3% Ave. Planning: 12%

Ennead Architects 1 World Trade Center New York, NY 10007

212-807-7171 ennead.com

Guy Maxwell, Kevin McClurkan, Molly McGowan, Richard Olcott, Tomas Rossant, Todd Schliemann, Peter Schubert, Don Weinreich, Thomas Wong Partners

105 96

110 101

Architecture: 100% The Cove/East Harlem Scholars Academy High School

Spectorgroup 183 Madison Ave. New York, NY 10016

212-599-0055 spectorgroup.com

Scott Spector Principal

96 95

98 97

Architecture: 40% MDC Partners/Northwestern Interiors: 55% Mutual Planning: 5%

CetraRuddy Architecture 1 Battery Park Plaza New York, NY 10004

212-941-9801 cetraruddy.com

Nancy Ruddy John Cetra Founding principals

81 76

83 78

Architecture: 75% Columbia University faculty and Engineering: 0% graduate housing/ARO Interiors: 15% Planning: 10%

Hill West Architects 11 Broadway New York, NY 10004

212-213-8007 hillwest.com

David West Stephen Hill Partners

74 91

74 91

Architecture: 100% Bankside at 101 Lincoln Ave. and 2401 Third Ave. in the Bronx/Olympia at 30 Front St. in Brooklyn

Robert A.M. Stern Architects 1 Park Ave. New York, NY 10016

212-967-5100 ramsa.com

Robert Stern Founder, senior partner

73 83

73 83

Architecture: 82% 555 W. 22nd St./1228 Madison Interiors: 18% Ave.

FXCollaborative Architects 22 W. 19th St. New York, NY 10011

212-627-1700 fxcollaborative.com

Guy Geier Managing partner

70 76

75 81

Architecture: 62% 1 Willoughby Square/Amtrak Engineering: 0% Metropolitan Lounge at Interiors: 28% Moynihan Train Hall Planning: 10%

AECOM 605 Third Ave. New York, NY 10158

212-973-2900 aecom.com

Denise Berger Chief operating officer, Northeast John Cardoni Executive vice president, Northeast

66 60

4,135 4,135

Beyer Blinder Belle Architects and Planners 120 Broadway New York, NY 10271

212-777-7800 beyerblinderbelle.com

Frederick Bland Managing partner

63 64

81 83

Architecture: 87% New York Public Library/National Engineering: 0% Urban League Interiors: 7% Planning: 6%

H2M Architects & Engineers 538 Broad Hollow Road Melville, NY 11747

631-756-8000 h2m.com

Richard Humann President, chief executive

63 67

65 67

Architecture: 36% Town of Hempstead/New York Engineering: 44% Housing Authority

SLCE Architects 1359 Broadway New York, NY 10018

212-979-8400 slcearch.com

Saky Yakas Managing partner

58 58

58 58

Architecture: 100% One Boerum Place/The Vu at 368 Third Ave.

STV Architects Inc. 225 Park Avenue South New York, NY 10003

212-777-4400 stvinc.com

Dominick Servedio Chairman Greg Kelly

58 62

103 107

Architecture: 60% RWJBarnabas & Rutgers Cancer Engineering: 15% Institute of New Jersey/ Interiors: 20% Accenture Planning: 5%

Architecture: 12% n/d Engineering: 70% Interiors: 1% Planning: 10%

New rese disc

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

12 | CRAIN’S NEW YORK BUSINESS | JUNE 28, 2021

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HEAD(S) OF NEW YORK–AREA OFFICE

Architecture: 39% Newark Liberty International 6/24/21 Engineering: 52% Airport Terminal One/South Interiors: 1% Beach Psychiatric Center

2:55 PM

CER

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9 10 11 12 13 13 1 15 1 15 3 17 4 18 5 19 6 20 7 21 8 22 9 23 10 23 11 25 12 26 13 27 13 27 15 29 15 29 17 18 19 RANK

Hill West Architects 11 Broadway New York, NY 10004

212-213-8007 hillwest.com

David West Stephen Hill Partners

74 91

74 91

Architecture: 100% Bankside at 101 Lincoln Ave. and 2401 Third Ave. in the Bronx/Olympia at 30 Front St. in Brooklyn

Robert A.M. Stern Architects 1 Park Ave. New York, NY 10016

212-967-5100 ramsa.com

Robert Stern Founder, senior partner

73 83

73 83

Architecture: 82% 555 W. 22nd St./1228 Madison Interiors: 18% Ave.

FXCollaborative Architects 22 W. 19th St. New York, NY 10011

212-627-1700 fxcollaborative.com

Guy Geier Managing partner

70 76

75 81

Architecture: 62% 1 Willoughby Square/Amtrak Engineering: 0% Metropolitan Lounge at Interiors: 28% Moynihan Train Hall Planning: 10%

AECOM 605 Third Ave. New York, NY 10158

212-973-2900 aecom.com

Denise Berger Chief operating officer, Northeast John Cardoni Executive vice president, Northeast

66 60

4,135 4,135

Beyer Blinder Belle Architects and Planners 120 Broadway FIRM/ ADDRESS New York, NY 10271

212-777-7800 beyerblinderbelle.com

Frederick Bland Managing partner

PHONE/ WEBSITE

HEAD(S) OF NEW YORK–AREA OFFICE

H2M Architects & Engineers Gensler 538 Hollow Road 1700Broad Broadway Melville, New York,NYNY11747 10019

631-756-8000 212-492-1400 h2m.com gensler.com

SLCE Architects 1359 Broadway Perkins New York,Eastman NY 10018 115 Fifth Ave. New York, NY 10003 STV Architects Inc. 225 Park Avenue South New York, NY 10003& Merrill Skidmore, Owings 7 World Trade Center New York, NY 10007 Stephen B. Jacobs Group 381 Park Ave. South New HOK York, NY 10016 5 Bryant Park New York, NY 10018 EwingCole

212-979-8400 slcearch.com 212-353-7200 perkinseastman.com

14 Penn Plaza New York, NY 10122 Kohn Pedersen Fox Associates 11 W. 42nd St. New York,Architects NY 10036 Dattner 1385 Broadway New York,Architects NY 10018 Ennead 1 World Trade Center New York, NY 10007 CannonDesign 360 Madison Ave. New York, NY 10017 Spectorgroup 183 Madison Ave. HLW International New York, NY 10016 5 Penn Plaza New York, NY 10001 CetraRuddy Architecture 1 Battery Park Plaza New York, NY 10004 NBBJ 140 Broadway Hill West New York, Architects NY 10005 11 Broadway New York, NY 10004 Diller Scofidio + Renfro 601 W. 26th St. New York, NY Stern 10001Architects Robert A.M. 1 Park Ave. New York, NY 10016

63

NEW YORK–AREA 64 ARCHITECTS 2020/ 2019

WORLDWIDE 83 ARCHITECTS 2020/ 2019

81

Architecture: 87% New York Public Library/National Engineering: 0% Urban League NEW YORK–AREA Interiors: SERVICE MIX (%7% OF BILLINGS) Planning: 6% 1 NOTABLE PROJECTS/CLIENTS 2

63 285 67 290

65 1,736 67 1,768

58 58 285 271

58 58 510 486

58 62 186 188

103 107 460 455

52 50 163 191

55 53 1,043 1,187

50 55

214 220

Architecture: 36% of Hempstead/New YorkPark 30% Town 10 Wythe Ave./Cure at 345 Engineering: Authority Engineering:44% 0% Housing Ave. South Interiors: 67% Planning: 3% Architecture: 100% One Boerum Place/The Vu at 368 Third Ave. Architecture: 67% The David H. Koch Center for Interiors: 29% Cancer Care at Memorial Sloan Planning: 4% Kettering Cancer Center/Resorts Architecture: 39% Newark LibertyNew International World Casino York City Engineering: 52% Airport Terminal One/South Interiors:90% 1% Beach Psychiatric Architecture: 175 Park Ave./EastCenter End Gateway Planning: 8% Engineering: 5% residential building Interiors: 3% Architecture: Planning:75% 2% 3 Sutton Place/Trinity Commons, Interiors: 25% 74 Trinity Place Architecture: 60% RWJBarnabas & Rutgers Cancer Engineering: 15% Institute of New Jersey/ Interiors: 45% 20% Irving Accenture Architecture: Plaza/RegenXBio Planning:30% 5% Engineering:

212-421-3712 sbjgroup.com 212-741-1200 hok.com

Richard Humann Robin Klehr Avia, Joseph Brancato President, chief executive Regional managing principals Rocco Giannetti, Molly Murphy, Joseph Lauro, Amanda Carroll Managing Saky Yakasdirectors, NY office Managing partner Andrew Adelhardt Shawn Basler Nicholas Leahy Dominick Servedio Co-chief executives Chairman Greg KellyLewis, Laura Ettelman Kenneth President, chief executive Managing partners Chris Cooper, Colin Koop Stephen Jacobs Design partners President Carl Galioto President, managing principal

212-897-4033 ewingcole.com

Mary Frazier Managing principal

212-977-6500 kpf.com

James von Klemperer President

136 132

233 228

212-247-2660 dattner.com 212-807-7171 ennead.com

Kirsten Sibilia Managing principal Beth Greenberg Guy Maxwell, Kevin McClurkan, Molly McGowan, Principal Richard Olcott, Tomas Rossant, Todd Schliemann, Peter Schubert, Richard Kahn Thomas Wong Don Weinreich, Office practice leader Partners

46 46 105 96

46 46 110 101

40 40

525 500

Scott Spector Principal Ed Shim Principal, managing director for New York Nancy Ruddy Cristen Colantoni John Cetra Principal Founding principals Timothy Johnson Joan Saba David West Partners Stephen Hill Partners Kevin Rice, Matthew Johnson, Robert Katchur Principals Robert Stern Steven Founder,Forman senior partner Principal, director of operations

96 95 39 43

98 97 42 46

81 76

83 78

31 32 74 91

240 245 74 91

30 30 73 83

31 31 73 83

212-777-4400 stvinc.com 212-298-9300 som.com

212-972-9800 cannondesign.com 212-599-0055 spectorgroup.com 212-353-4600 hlw.com 212-941-9801 cetraruddy.com 212-924-9000 nbbj.com 212-213-8007 hillwest.com 212-260-7971 dsrny.com 212-967-5100 ramsa.com

Architecture: 12% n/d Engineering: 70% Interiors: 1% Planning: 10%

Interiors: 20% Architecture: 85% One Vanderbilt/One Madison Planning: 5% Interiors: 3% Ave. Planning: Architecture:12% n/d Spring Creek Landing resilient mixed-use development/Apex Group Harlem Scholars Architecture: 100% Building The Cove/East Academy High School Architecture: 55% Engineering: 20% Interiors: 20% Planning:40% 5% Architecture: Interiors: 55% Architecture: Planning:n/d 5% Architecture: 75% Engineering: 0% Interiors: 15% Planning: 51% 10% Architecture: Interiors: 49% Architecture: 100% Planning: 1%

Northwell Health Petrocelli Advanced Surgical Pavilion/ Richmond University Medical Center expansion MDC Partners/Northwestern Mutual Google/Raymond James Columbia University faculty and graduate housing/ARO

BlackRock headquarters/Coney Island Hospital, critical services Bankside at 101 Lincoln Ave. structure and 2401 Third Ave. in the Bronx/Olympia at 30 Front St. in Architecture: n/d Columbia Brooklyn Business School/The High Line Architecture: 82% 555 W. 22nd St./1228 Madison Interiors: 18% Ave.

TPG Architecture FXCollaborative 132 W. 31st St. Architects 22 W.York, 19thNYSt.10001 New New York, NY 10011

212-768-0800 212-627-1700 tpgarchitecture.com fxcollaborative.com

Fredric Strauss Guy Geier James Phillips Managing executives partner Managing

30 70 39 76

30 75 39 81

NK Architects 233 Broadway AECOM New 605 York, Third NY Ave.10279 New York, NY 10158

212-982-7900 nkarchitects.com 212-973-2900 aecom.com

28 28 66 60

28 28 4,135 4,135

Gertler & Wente Architects 145 30th St.Belle Architects BeyerW.Blinder New York, NY 10001 and Planners 120 Broadway New 3York, NY 10271 FCA

212-273-9888 gwarch.com 212-777-7800 beyerblinderbelle.com

Paul Drago Principal Denise Berger Chief operating officer, Northeast John Cardoni Executive vice president, Northeast Larry Wente Partner Frederick Bland Managing partner

25 27 63 64

25 27 81 83

646-315-7000 fcarchitects.com 631-756-8000 h2m.com

Anthony Colciaghi, Steven Stainbrook Wan Leung, Kenneth Kramer, Richard Humann Mark Harbick President, chief executive Principals

24 22 63 67

42 58 65 67

Stantec Architecture Inc. 475 Ave. SLCEFifth Architects New NY 10017 1359York, Broadway New York, NY 10018

212-366-5600 stantec.com 212-979-8400 slcearch.com

Tom Walsh Vice Sakypresident Yakas Managing partner

24 22 58 58

560 554 58 58

Architecture: 5% One Vanderbilt transit Engineering:100% 79% improvements/UPS Yonkers Architecture: One Boerum Place/The Vu at Interiors: 2% distribution facility 368 Third Ave. Planning: 13%

Davis Brody Bond Architects 1STV New York PlazaInc. 225 York, Park Avenue South New NY 10004 New York, NY 10003

212-633-4700 212-777-4400 davisbrody.com stvinc.com

22 58 23 62

22 103 23 107

Stonehill Taylor Stephen B. St. Jacobs Group 31 W. 27th 381 Park Ave. South New York, NY 10001 New York, NY 10016

212-226-8898 212-421-3712 stonehilltaylor.com sbjgroup.com

William Paxson, Carl Krebs, Dominick Servedio Christopher Grabé, Steven Davis, Chairman David Williams Greg Kelly Partners President, chief executive Paul Taylor Stephen Jacobs President President

22 52 22 50

22 55 22 53

Architecture: 100% Architecture: 39% Engineering: 52% Interiors: 1% Planning: 8% Architecture: 77% Architecture: Engineering:75% 0% Interiors: 23% 25% Interiors: Planning: 0%

EwingCole

212-897-4033

Mary Frazier

50

214

40 Worth St. H2M Architects & Engineers New York, NY 10013 538 Broad Hollow Road Melville, NY 11747

Architecture: 85% Architecture: 62% Interiors: 15% Engineering: 0% Interiors: 28% Planning: 10% Architecture: 80% Engineering:12% 5% Architecture: Interiors: 10% Engineering: 70% Planning: Interiors: 5% 1% Planning: 10% Architecture: 57% Interiors: 43% Architecture: 87% Engineering: 0% Interiors: 7% Planning: 6% Architecture: 63% Engineering: 23% Architecture: 36% Interiors: 12% Engineering: 44% Planning: 2%

NHL/Amaffi 1 Willoughby Square/Amtrak Metropolitan Lounge at Moynihan Train Hall The Brooklyn Hospital emergency department/The Chapin School n/d

Seventh Day Adventists Church/ 52 Ave. inLibrary/National Brooklyn NewFourth York Public Urban League EisnerAmper headquarters/ Newark Beth Israel master plan Town of Hempstead/New York and implementation Housing Authority

181 Mercer St./Zero Irving for Newark International New YorkLiberty City Economic Airport Terminal One/South Development Corp.

Beach Psychiatric Center residential building Margaritaville Resort Times 3 Sutton Place/TrinityNew Commons, Square/Renaissance York 74 Trinity Place Chelsea Hotel

Architecture: 45% Irving Plaza/RegenXBio

14 Penn 220list, firmsEngineering: New York area includes New Plaza York City and Nassau, Suffolkewingcole.com and Westchester counties inManaging New Yorkprincipal and Bergen, Essex, Hudson and Union counties in New55 Jersey. To qualify for this must have a30% New York–area office. Crain's uses staff York, NYthe 10122 Interiors: 20%firms are listed alphabetically. n/d-Not research, extensive New surveys and most current references available to produce its lists, but there is no guarantee that these listings are complete. In cases of ties in the number of New York–area architects, disclosed. 1--Figures may not add up to 100% due to rounding. 2--Must be active projects in the New York area. 3--Formerly known as Francis Cauffman.

Planning: 5% Dattner Architects 1385 Broadway New York, NY 10018

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CannonDesign 360 Madison Ave.

212-247-2660 dattner.com

Kirsten Sibilia Managing principal Beth Greenberg Principal

46 46

46 46

Architecture: SpringNEW CreekYORK Landing resilient | 13 JUNE 28, 2021n/d | CRAIN’S BUSINESS

212-972-9800 cannondesign.com

Richard Kahn Office practice leader

40 40

525 500

Architecture: 55% Northwell Health Petrocelli6/24/21 Engineering: 20% Advanced Surgical Pavilion/

mixed-use development/Apex Building Group

3:02 PM

HEALTH CARE

BY SHUAN SIM

B

usiness leaders acknowledge the importance of protecting employees’ right to paid sick leave, especially during the pandemic, but they are criticizing what they call vague language and the various prohibitions that make it hard to comply with the legislation.

The state’s version of the paid sick leave law took effect Jan. 1. Some employers say the way it has been implemented has put an undue burden on them.

“Employers providing paid sick leave is a good thing. That’s why 80% of businesses had provided it in some form even before the legislation,” said Frank Kerbein, director of the Center for Human Resources at the Business Council of New York State. “But the way New York state has done it is bad.”

The state’s legislation does not require workers to provide minimum advance notice to use paid sick leave, and employers are prevented from asking for documentation, Kerbein said. Not only does this open the system up to abuse, but it also makes it harder for business

owners to find workers to cover the gap, especially during a workforce shortage, he added.

“We don't want people coming in to work sick. But especially in the restaurant industry, if someone takes off right before a shift starts, it presents operational challenges,” said Andrew Rigie, executive director of the NYC Hospitality Alliance.

“Unlike office work, a restaurant’s work doesn’t sit on a desk until the next day.”

In addition, Gov. Andrew Cuomo signed an executive order in March 2020 that provided extra time off for quarantine purposes, which compounded challenges for toeing the legal line, Kerbein said. Business owners said the mandate felt like an additional expense, he added.

Small businesses feel the brunt of such mandates more than larger ones, Rigie said.

“Some just don't have the cash flow, especially during the pandemic, to pay out the sick leave, especially if the requests all come at once,” he said.

The penalties for breaking the law—both financial and criminal— are also harsh as noncompliance is akin to wage theft, Kerbein said.

The state Department of Labor declined a request for comment.

Businesses recognize it is in their best interest to provide sick leave, but the industry had hoped for flexibility or input in how it could enact such policies, Kerbein said.

“Covid had disrupted us beyond anything we could imagine, and we just want to rebuild the economy," Rigie added. “Employers want to contribute without having worry about running afoul of an intricate law.”

A look at the city A recent study from New York University found that the city’s implementation of its paid sick leave law, passed in 2014, reduced emergency room and specialist visits and increased the likelihood that a person had received preventive services.

The NYU study analyzed the usage patterns for emergency care, specialist and primary care visits as well as preventive care services of more than 550,000 Medicaid beneficiaries in the city and state from 2011 through 2017. It found that before the city’s implementation of its law, such patterns were similar in

GOVERNORANDREWCUOMO/FLICKR

Rollout of paid sick leave law has been burdensome despite its benefits, business leaders say CUOMO

the city and the state. Within the first year of the city law going into effect, however, it achieved a 0.6% reduction in emergency department visits. There also was a 0.3% reduction in visits to the emergency department for conditions that could have been addressed in a primary care setting.

The numbers might sound small, but it’s important to note that the state had been trying for more than a decade to reduce emergency room usage among Medicaid beneficiaries but had never succeeded, said Sherry Glied, dean and professor of public service at NYU’s Robert F. Wagner Graduate School of Public Service. These small percentages translate into more than 8,000 fewer

emergency room visits per year, which is significant, she added.

Although the study did not capture usage statistics for health care services during the pandemic, it was reasonable to expect the city law helped alleviate emergency room visits during the crisis, Glied said.

“Having their pay protected so they can take time off was key for preventing anyone from waiting too long to see a doctor, before [their] illness got worse,” she said. Being able to take time off during the day meant employees—especially lower-income ones—could see a doctor during work hours rather than go to the emergency room for an after-hours visit, she added. ■

14 | CRAIN’S NEW YORK BUSINESS | JUNE 28, 2021

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Y

HEROES ON THE HORIZON

oung professionals will play a pivotal role in the city’s economic recovery from the Covid-19 pandemic. Members of Crain’s 20 in Their Twenties Class of 2021 come from varied backgrounds, but they all share a strong work ethic, a sense of creativity and digital savvy. These talented individuals, through ideas and entrepreneurship, are shaping a future for a brighter Big Apple, leaving their mark on technology, real estate, health care and social media. Whether these 20somethings work in the public or private sector, all of them parlayed the havoc of 2020 into a way to move their generation forward. At a time when the city is looking for inspiration, they are leading the way.

— LIZETH BELTRAN PHOTOGRAPHS BY BUCK ENNIS

BACKGROUNDS AND SHADOW FIGURES, ISTOCK

CrainsNewYork.com/20-in-their-twenties-2021

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RACHEL MAENG BROWN, 25

Co-founder, director of talent and brand management, Loot Agency THE LOCKDOWNS LAST YEAR DEVASTATED BUSINESSES. But Rachel Maeng Brown, a onetime social media micro-influencer and Rutgers rowing-team coxswain, saw an opportunity.

Young people were on social media more than ever. To reach them, marketers needed influencers—the popular creators of social media content. Having produced career-advice videos for TikTok, Brown understood how hard it is to create content and run a business.

So in March she and three other entrepreneurs founded the Loot Agency to connect influencers with brands while helping creators manage everything from banking to contracts. Loot, focused on smaller creators, now represents more than 15 influencers with 25 million followers—and has marketing deals with Macy’s and TurboTax. Brown will soon help launch a sports division along with a pilot program—with 10 Division I universities and professional and collegiate sports organizations—to teach pro and amateur athletes the basics of influencing.

Companies “are looking for people who are good influencers, and a lot of the time they’re looking for athletes, because they really are the superheroes of today,” Brown said. “Even if you [don’t) go on to a career after college, your personal brand still matters.”

— MATTHEW FLAMM

LOREN CHERI SHOKES, 28

Associate, Skadden, Arps; Professor, Roc Nation SHE MAY BE a Harvard law grad working at a white-shoe law firm, but Loren Cher Stokes recently summed up her work with a reference to rapper Cardi B. Shokes, who represents big names in music, sports, fashion and entertainment, said she recently tried to calculate the worth of all the financial transactions she’s helped facilitate.

When she arrived at a number “in the tens of billions,” the rapper’s lyric “I make money move” popped into her head and she realized, “Yes, I feel like Cardi B right now!”

At Skadden, Arps, Shokes has maneuvered companies, including AMC Theatres, through the financial complications of the pandemic.

Perhaps not coincidentally, Shokes recently signed on as the youngest professor at Jay-Z’s Roc Nation School of Music, Sports and Entertainment, to open at Long Island University in the fall.

How did this California-raised, Harvard-educated, Cardi B-quoting, Jay-Z-affiliated young woman come so far so fast?

Shokes said she originally planned to follow her father into sports medicine, but as an undergraduate at UCLA, she decided to follow a different path.

“I’ve always just had a really strong love for sports and entertainment,” she said.

— RICHARD CONTI

16 | CRAIN’S NEW YORK BUSINESS | JUNE 28, 2021

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KHALEEL M. ANDERSON, 25 Assemblyman, District 31, Southeast Queens NOT EVERYONE WINS ELECTED OFFICE AT AGE 24. Then again, not everyone holds the same

idealism as Khaleel M. Anderson.

Following in the footsteps of his mother, a community organizer and an Acorn activist, and Malcolm X, whom he considers an inspiration, Anderson entered city politics after working with local nonprofits to improve bus service for his Far Rockaway neighborhood and add science, technology, engineering and math programs to the curriculum of his District 75 high school.

“I always fought back against things I thought were unfair or unequal,” said Anderson, a Democrat. “My passion is to try to connect young people to their community and resources and to fight back against systemic racism and oppression that impacts our households.”

Anderson, victorious in November 2020, aims to use his first term in the Assembly to sponsor youth-focused initiatives that he hopes will reverberate across the different geographic and demographic populations of his district and engage those who previously felt excluded by the political process.

“We as a community and as leaders have to be visionary and working towards something,” he said. “If I don’t leave behind an institution or system, something that will perpetuate seismic change in this Assembly district, then I didn’t do my job.”

— BRIAN PASCUS

KRIS SIDIAL, 28

Chief investment officer, Ambrus Group

“

I REALLY HAD TO HUSTLE. I DROVE AN HOUR EVERY DAY TO LEARN UNDER THIS GUY”

ALEXANDRA EMMERMAN, 25 Agent, ICM Partners

JUST FOUR YEARS AGO, fresh out of college, Alexandra Emmerman was pushing a mail cart and delivering coffee in the notorious mailroom at the talent agency William Morris Endeavor. She worked her way up in record time, and now the Westchester native is one of the youngest agents in the industry, representing talent in the nonscripted television business at ICM Partners.

Emmerman was hired by ICM in January, in the heat of the pandemic. With in-person work still on hold, she works from her Greenwich Village apartment, growing her roster of clients. They range from Scott Evans, co-host of Access Hollywood and TikTok star Josh Richards to off-screen talent such as Rachel Fleit, director of the upcoming Selma Blair documentary.

“With all of the new streaming platforms, there’s never been more of a need for content,” Emmerman said. “It’s just figuring out where different types of content will live.”

A “professional multitasker,” Emmerman sends more than 100 emails a day, setting up pitches for clients and negotiating deals. She always has work on her mind—anything interesting in the news, podcasts, books and on Instagram could lead to a compelling new series.

— MIRIAM KREININ SOUCCAR

WHILE GROWING UP in the gang-ridden hamlet of Brentwood, Long Island, Kris Sidial’s immigrant mother emphasized education and Christian faith as the building blocks he would need to escape that environment.

“The culture is pretty hard knocks,” Sidial recalled. “You’re either very intense with your work ethic or you succumb to the realities of the rest of the town.”

Sidial, gifted in math and mentally acute in statistical analysis, caught his break after college by pitching himself to an older, retired Wall Street veteran and learning high-volatility trading at a small family office in the Hamptons.

“I really had to hustle,” he said. “I drove an hour every day just to learn under this guy.”

After five years of trading exotic derivatives and listed options, Sidial and three partners started their own hedge fund in 2018, the Ambrus Group.

“We realized this current stock market has showcased a lot of fragility over the last five years,” Sidial explained. “It gives you opportunities to make huge asymmetric payouts.”

As he trades by day, Sidial continues to hustle by night: a master’s degree in computer science and mathematics at the University of Pennsylvania is next.

— BRIAN PASCUS

FUN FACTS: I’M AN EXPERT IN MOVIE TRIVIA

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ALICE FAIR, 28

First vice president, CBRE

THROUGHOUT HER CAREER, Alice Fair has spent a lot of time mentoring female colleagues, giving advice that she wished she knew when she was starting out.

“You have this kind of worry that because you’re in such a male-dominated industry that you have to always be on the defensive,” Fair said. “There are so many ways in which we can educate and open up the industry.”

As a vice president at CBRE, she spends most of her day canvassing for both tenant and landlord clients. Pinterest, TikTok and Uber have been some of her biggest wins.

“I'm always looking for an opportunity to really add value,” she said, “and bring new concepts and fun things to the table.”

Fair draws inspiration from her interests in food and travel, and uses her experiences to find meaningful ways to connect with clients beyond showing what an available space has to offer.

“I think you can really bring to life what being a tenant is like in a neighborhood,” she said. “Being able to say, ‘This coffee shop is awesome’ is one thing, but being able to say, ‘You really have to get the key lime pie from Petee’s Pie down the street’? It just resonates with a lot of our clients.” — JESSICA MILITELLO

MILES BURNETT, 29

Founding member and managing director, Bronx Rising Initiative TRAINED AS AN ACTOR , including a stint at the Circle in the Square Theatre School, Miles Burnett realized that as much as he loved acting, he missed the political activism of his college days.

So in 2015 Burnett became a canvasser for the Working Families Party. He went on to manage local political campaigns for Justin Sanchez and Tomas Romas and worked as communications director for former City Council member Andrew Cohen.

Years later he landed at the Southern Boulevard Business Improvement District in the Bronx, where in 2019 Burnett became executive director and where, among other things, he advocates for small businesses.

Seeing a need for a quick and effective response to the pandemic, he helped found the Bronx Rising Initiative, which today delivers critical resources to struggling businesses and residents, including cash grants and access to vaccinations.

At the same time, Burnett has been traveling around the state, talking to business owners and learning that the problems businesses face in Oswego are not that different from those in the Bronx.

“Engaging with people and different businesses and hearing issues and trying to find solutions, I want to find ways to do that on a larger scale,” he said.

— JUDY MESSINA

TEDDY HAGGERTY, 25

President, Defender Safety

AT ONLY 16-YEARS-OLD, Teddy Haggerty had learned everything he needed to know about business. Less than 10 years later, his is a success story built on wit, ingenuity and lessons learned early on.

Haggerty is president of Defender Safety, a Plainview, Long Island-based construction safety equipment manufacturer that started selling medical equipment during the early days of the pandemic. It is the latest example of a precocious New Yorker seeing an opening and going for it.

As a teen, Haggerty built drones and used the devices to record aerial shots of properties for use in real estate marketing. In college he mined Bitcoin and other cryptocurrencies. He dropped out and founded Defender Safety as an offshoot of his father’s construction supply business in 2019.

When the pandemic hit, he sensed a need for medical equipment and used his supply chain to manufacture high-quality personal protective equipment. Defender earned a clientele that now includes 70 hospitals as well as major construction companies. The kinetic entrepreneur has grown Defender into a company with 12-month trailing revenue of more than $20 million despite having only a few employees.

“We’ve had a healthy growth and substantial revenue increase from our humble beginnings,” he said.

Yet he has no plans of slowing, with a pipeline of new medical and industrial products on the way.

“We’re going to be doing this 20 to 30 years down the road,” he said. “Yeah, keep — RICHARD CONTI going.”

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FUN FACT: I’M RELEASING MY FIRST SINGLE AS A RECORDING ARTIST IN AUGUST UNDER MY STAGE NAME, SANTI, SHORT FOR SANTIAGO

ERIN O’SULLIVAN, 29 Law clerk, Dentons

A TITLE UPGRADE IS in the works for Erin O’Sullivan. She passed the bar exam in October but is still waiting to be admitted to the bar, blaming the delay on the pandemic.

Since January O’Sullivan has served as a law clerk at Dentons US, a global law firm with an office in New York.

She works in the litigation and dispute resolution group in federal and state court. When she becomes an associate, she’ll be able to litigate cases without a supervising attorney.

While earning her law degree at Georgetown, she worked with Lawyers Without Borders, participating in pro bono international training programs. She says that the experience was a springboard for her career.

Also in law school, she received the Exceptional Pro Bono Award for her time spent volunteering with social justice organizations, racking up over 250 pro bono hours. She plans to continue to focus on such work.

“It’s definitely my trajectory and what I’m interested in — JESSICA MILITELLO moving forward,” she said.

“

JOE LARESCA, 28

WE’RE GOING TO BE DOING THIS 20 TO 30 YEARS DOWN THE ROAD”

Founder and CEO, Noise

IF THERE’S ONE WORD TO DESCRIBE THE FOUNDER AND CEO OF NOISE, it’s relentless.

Joe Laresca, a Staten Island native, started his firm—a marketing, advertising and creative agency—in 2018 after building out a real estate media business for Ryan Serhant of Bravo’s Million Dollar Listing New York.

It took Laresca 56 emails and several pitch decks to convince Serhant that he should be the one to handle the real estate broker’s digital media presence. Laresca started Serhant’s YouTube channel and grew it to more than 1 million subscribers in less than two years, increasing web impressions from 1 million to 100 million a month.

Laresca’s work has brought in more than $100 million in real estate sales for Serhant.

“He gave me an inch, and I took it a mile,” Laresca said.

Now he has struck out on his own, using Noise to handle marketing for real estate and hospitality companies, including Extell Development, BDG and Lightstone.

“We want to be every developer and architect’s first call,” said Laresca, a first-generation college graduate whose mother emigrated from Ecuador as a teenager.

Noise recently became the agency of record for Villa One, a tequila company founded by Nick Jonas and John Varvatos, its first major deal in consumer packaged goods. His company has its own startup studio, which it used to launch vitamin company Boost.

“We understand how to create something from scratch, not just amplify it,” Laresca said.

— JONATHAN LAMANTIA JUNE 28, 2021 | CRAIN’S NEW YORK BUSINESS | 19

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ZACHARY MARC, 29 General manager, Amazon

IT WAS DURING HIS TIME as an undergraduate at Rutgers University in his home state of New Jersey that Zachary Marc heard a stat that stuck with him.

There would soon be just one candidate for every five job openings in supply-chain management, a professor said. Marc soon dropped his finance major and switched to studying the supply chain.

To him, it was like putting together a puzzle of how businesses worked.

“I was always interested in where things actually came from,” Marc said, “and understanding the supply chain really helped me understand that better.”

Today, as a general manager for Amazon’s warehouse on Staten Island, he helps oversee a link in one of the largest distribution networks in the world.

Marc has been with the company for seven years, starting as an area manager in New Jersey and working up to assistant general manager on Staten Island late last year. In April he was promoted to be a general manager. He helps guide a team of 4,000 employees in a nearly 850,000-square-foot facility.

“Getting to know people is always the first step,” Marc said of his management strategy, adding that he makes sure he knows the staff personally and understands their motivations.

— RYAN DEFFENBAUGH

ARIELLE GARCIA, 29

Chief privacy officer, UM Worldwide

AROUND 10 YEARS AGO, Arielle Garcia was hired by UM Worldwide as an administrative assistant for the lead executive on the Exxon Mobil account. Soon she was supporting eight executives and taking on special projects at the media company.

“I am the person who either knows it or will figure it out,” said Garcia, a graduate of Macaulay Honors College in Queens. “I kept taking things on and became the guru for all things operations.”

That attitude and work ethic landed her a fast promotion to senior associate of global operations after just six months.

When new privacy laws started changing the way data is used in marketing, Garcia became the company expert. Last year she was named the first agency-based chief privacy officer, advising more than 100 clients globally on the evolving regulatory landscape.

While moving up the ranks, Garcia attended Fordham Law School at night, receiving a law degree in 2018. At Fordham she focused on corporate social responsibility, exactly what she practices at UM. “I used to think that the not-for-profit world was the easiest way to have an impact,” Garcia said. “Then I recognized that proving that doing the right thing can actually be commercially beneficial in the for-profit space, [and] it is an important way to drive — MIRIAM KREININ SOUCCAR change.”

FUN FACTS: I HAVE AN IRRATIONAL FEAR OF FLOWERS

JESSY YATES, 27

Actor; performance artist; disability advocate; master of fine arts candidate, Yale School of Drama THANKS TO A RECENT ROLE, Jessy Yates is now officially a professional New York actor. She recently appeared on Law & Order: Special Victims Unit—a series known for casting successful actors early in their career. Getting there has taken Yates years of training and self-reflection, as she sought balance between being a disability advocate and an actor.

Yates has cerebral palsy and uses a wheelchair. She acted as a kid but decided to go to college for directing. At New York University, she tackled her disabled identity. She decided to direct shows that explore the physical world of disability, but she had no one to cast.

“If I wanted to be the person I cast,” she said, “I had to make sure I was good enough for the job.”

She applied and was admitted to the Yale School of Drama. The dean, realizing the school would have a lot to learn, helped create a scholarship for her. Yates has pushed the school and her classmates to make spaces and work accessible.

She hopes that her experience influences how they include disabled actors at the school’s now-accessible repertory theaters—and in their future work, on the sets of the television shows where Yates hopes to work.

— CARA EISENPRESS

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“

LAURENCE GIRARD, 29 Founder and CEO, Fruit Street Health

“

I WANTED TO MAKE THIS MORE OF A GRASSROOTS EFFORT”

DIABETES IS ON THE RISE across the U.S., but Laurence Girard believes Fruit Street Health can help keep the chronic disease in check.

The 29-year-old founded Fruit Street in 2014 after closing his earlier telehealth company, Prevently. The fresh start allowed him to switch his business model from selling to consumers to selling to employers and insurers, and it led him to focus on physicians as investors.

“Instead of working with venture capital firms, I wanted to make this more of a grassroots effort in public health,” Girard said. His new investors “really want to make a social impact,” a desire he found lacking in his first venture, he said.

Fruit Street, based in the Financial District, offers telehealth video visits with registered dietitians, peer support and ways to track users’ diet and activity. It has raised more than $24 million from about 500 physician investors. The company, with 40 employees, generated about $2 million in revenue last year. Girard expects Fruit Street to generate between $5 million and $6 million this year.

The Centers for Disease Control and Prevention recognized the startup’s effort as a diabetes prevention program. Those who participated in it for nine months reported a weight loss of at least 5%.

With nearly 1,900 organizations recognized for diabetes prevention, Fruit Street has plenty of competition. Some of its tech rivals in the space include well-financed companies such as Noom, Omada Health and Teladoc.

“What differentiates us is we have live classes,” Girard said. “We feel that most closely replicates an in-person experience, is more engaging and helps form a deeper emotional connection with other participants.”

— JONATHAN LAMANTIA

CRAIN’S NEW YORK

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JUNE 28, 2021 | CRAIN’S NEW YORK BUSINESS | 21

RENA GENAUER, 27

State and local tax manager, Citrin Cooperman

IF THERE’S ONE SKILL THAT Rena Genauer credits her accounting career to, it is her knack for numbers.

Since graduating from Yeshiva University six years ago, Genauer has worked as a state and local tax adviser at Citrin Cooperman. Approximately 75% of her clients are businesses, including cannabis, entertainment and technology companies. The rest of her practice is made up of individuals, who are typically interested in residency planning.

Genauer advises on the tax implications of corporate and personal decisions.

“For example, a lot of people in the cannabis industry know the product but not the business around it,” she said. “We can help them figure out tax incentives and get credits.”

Genauer also does tax investigations for mergers and acquisitions.

“We can find skeletons in the closet that would change the price of a deal or make it obsolete,” she explained.

Having recently been consulted by high-level members of her firm on plans for a new office space, Genauer feels Citrin Cooperman’s decision-makers hear her.

“Sustainability is important to me, and we talked about ways to reduce our carbon footprint,” Genauer said. “I am proud to work for a company that values my input.”

— DIANE HESS

“

WE CAN FIND SKELETONS IN THE CLOSET”

SHYLEE EZRONI, 25 JULIANA EMMANUELLI, 26 Co-founders, the <wit> project

NONPROFITS NEED HELP HARNESSING TECHNOLOGY. And City University of New York students seeking to work in tech need on-the-job experience.

That’s where Shylee Ezroni and Juliana Emmanuelli saw a way to help women join the city’s growing technology workforce.

“There was this really cool opportunity to get students hands-on coding experience through nonprofits,” Emmanuelli said. “Nonprofits are often under-resourced and willing to get help with whatever they can.”

The two founded the nonprofit the <wit> project, which connects women studying at CUNY schools with fellowships providing technology support for nonprofits, along with training in software skills from a team of volunteer mentors.

Ezroni and Emmanuelli run the effort, with help from volunteers, on top of holding technology jobs at JPMorgan and the startup Attentive, respectively.

The <wit> project has had 19 students graduate at this point, working with nonprofits such as the Urban Institute and Child Care Aware of America. The goal is to reach 24 students next year.

Although tech is growing and creating opportunities, Ezroni said, there is much work to be done to create a more inclusive industry. “There is a big opportunity for smaller companies that are up-and-coming to set a new standard for the next generation,” she said.

— RYAN DEFFENBAUGH

MATTHEW GAETA, 26

Founder and CEO, Gaeta Sports Management ONE OF THE YOUNGEST AGENTS TO NEGOTIATE a multiyear contract extension for a Major League Baseball player, Matthew Gaeta got an early start on his career. But he’d been preparing a long time: From childhood through freshman year at New York University, when an injury ended his athletic dreams, Gaeta played catcher—the most thankless position in baseball.

“You won’t get the praise that a pitcher or shortstop does,” he said.

“It’s a selfless position, and that’s a lot of how I operate.”

How selfless? Gaeta spent his past two Thanksgivings not with his own clan in New Jersey but with Nick Anderson and his family. The star reliever for the Tampa Bay Rays was among the first players he signed.

Gaeta travels the country, checking on his more than 80 clients including five major leaguers. When he’s not traveling—or taking night classes at New York Law School—he’s probably on the phone.

“It’s about the relationships that he builds not just with me but with my family,” says Randy Dobnak, a Minnesota Twins pitcher who signed a $9.25 million five-year deal that Gaeta negotiated on his 26th birthday.

“He talks to my wife and my parents. He talks to my wife’s parents. Family comes first—and then the business.”

—MATTHEW FLAMM

22 | CRAIN’S NEW YORK BUSINESS | JUNE 28, 2021

ROSHUN PATEL, 26

FUN FACTS: I BACKPACKED THROUGH CENTRAL AMERICA

Vice president, Genesis Trading

STUDYING MATH AND PHYSICS helped prepare Roshun Patel for a career lending out Bitcoin and other cryptocurrency to institutional investors. But ultimately, he’s where he is because his parents insisted he work on his handwriting.

They subscribed to the Financial Times and made Patel transcribe articles by hand. In this way he learned all about the great crash of 2008 as it happened. By the time he attended a finance class at Syosset High School on Long Island, he was ready to learn from teacher Thomas Barrella.

“He taught the importance of being skeptical and curious,” Patel said.

That paid off when Patel pinged Genesis about a job and an executive who also had been one of Barrella’s students picked up the phone.

These days Patel’s firm oversees $10 billion worth of loans to 400 clients. He was employee No. 13. Now the firm has 100 employees. And Bitcoin has gone from a chew toy for financial geeks to a global asset class.

Patel started in finance by working at one of the last trading pits at the Chicago Mercantile Exchange. He was good at coding and started writing programs to trade crypto. He made money, lost it, then landed at a family office before he understood the family wasn’t interested in crypto.

As for his own family, his father trades crypto, but his mother won’t touch it.

“They get what I’m doing-ish,” he said.

He added that his handwriting remains impeccable.

— AARON ELSTEIN

SARAH PIERCE, 28

EVP, Head of operations and sales, Better BEFORE JOINING MORTGAGE LENDER Better at age 22, Sarah Pierce sold TIQO Beverage, the tequila mix company she had started in her senior year at Barnard College.

Pierce took that same entrepreneurial spirit to Better in 2014, when it had just 30 employees. Today it has 8,000—7,000 of whom are under her management, and the company has gone from funding a few billion dollars a year in loans to $25 billion in 2020 and $14 billion in the first quarter of this year.

As head of operations and sales, Pierce builds strategy, leverages technology, oversees product teams and tries to think creatively about the process of buying a home.

One of her goals is to create products for specific markets to help women and people of diverse backgrounds buy homes.

“Buying a home is one of the best multigenerational ways to build wealth,” Pierce said. “Minimizing the wealth gap is so important to the economy and to Americans.”

Better’s innovative model can help do that, Pierce said. Unlike most other lenders, she said, Better’s sales reps are salaried and don’t make commissions. That way of doing business, Pierce said, aligns them with customers’ interests.

With that and Better’s automated, online intake process, the company can “issue an eligibility decision automatically and earlier in a rigorous and unbiased way,” she said.

— JUDY MESSINA

“

HE TAUGHT THE IMPORTANCE OF BEING SKEPTICAL AND CURIOUS”

ANTHONY DIGIROLAMO, 28 Senior mechanical, electrical, plumbing and fire suppression estimator, Hunter Roberts Construction Group A LIFELONG FASCINATION WITH AUTOMOBILES, fostered during childhood visits to classic-car shows, led Anthony DiGirolamo to pursue a college degree in engineering.

Although he thought he would focus on automotive engineering, he was deterred by the lack of car companies in the Northeast, where he hoped to settle one day. Instead, he studied mechanical engineering. As an undergraduate at Stevens Institute of Technology in New Jersey, DiGirolamo interned at engineering consultancy AKRF. He then pursued a master’s degree in construction management.

Today DiGirolamo is a mechanical, electrical, plumbing and fire suppression estimator at Hunter Roberts Construction Group, where he has worked on nearly 400 projects in the past five years.

His work includes estimating costs, identifying design discrepancies and handling logistics.

DiGirolamo is involved in residential, commercial, health care and life sciences developments, in addition to pier projects. Recent assignments have included Little Island on the Hudson River and the central utility plant at Mount Sinai South Nassau Hospital.

“Seeing something develop from a narrative all the way through to completed construction is incredibly rewarding,” DiGirolamo said.

The firm recently gave DiGirolamo an award for client satisfaction.

“He has gained the respect of every mechanical and electrical engineer on our projects,” said Mark Lamble, executive vice president of preconstruction at Hunter Roberts.

— DIANE HESS

FUN FACTS: I’VE ORGANIZED A TOYS FOR TOTS COLLECTION THE PAST TWO YEARS

JUNE 28, 2021 | CRAIN’S NEW YORK BUSINESS | 23

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PUBLIC & LEGAL NOTICES NOTICE OF FORMATION OF KOHOKUKU LLC. Articles of Organization filed with the Secretary of State of NY (SSNY) on 02/01/2021. 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: 5501 JUNCTION BLVD ELMHURST, NY 11373. The principal business address of the LLC is: 709 9TH AVE NEW YORK NY 10019. Purpose: any lawful act or activity

Notice of Qualification of A PRIORI INVESTMENT MANAGEMENT LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 06/16/21. Office location: NY County. LLC formed in Delaware (DE) on 05/15/14. Princ. office of LLC: 363 Lafayette St., NY, NY 10012. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to c/o Corporation Service Co., 80 State St., Albany, NY 12207-2543. DE addr. of LLC: 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with Jeffrey W. Bullock, 401 Federal St., #4, Dover, DE 19901. Purpose: Any lawful activity.

Notice of Qualification of COFFEE DIGITAL, LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 06/ 09/21. Office location: NY County. LLC formed in Delaware (DE) on 05/ 26/21. Princ. office of LLC: 177 Mott St., NY, NY 10012. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to the LLC at the princ. office of the LLC. DE addr. of LLC: c/o Corporation Service Co., 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with Secy. of State of the State of DE, 401 Federal St., Dover, DE 19907. Purpose: Any lawful activity.

Notice of Formation of KMH WORKS LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 05/25/21. Office location: NY County. Princ. office of LLC: 79 Laight St., #6D, NY, NY 10013. 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.

SJD, LLC Auth. filed w/ SSNY on 5/17/21. NYS fictitious name: SJD NY LLC. Office: New York Co. LLC formed in DE on 3/26/18. SSNY designated as agent for process & shall mail to: 1407 Broadway, #3507, NY, NY 10018. DE addr. of LLC: 16192 Coastal Highway, Lewes, DE 19958. Cert. of Form. filed w/ DE Sec of State, 401 Federal St, #4, Dover, DE 19901. Purpose: any lawful.

Notice of Formation of LCT3, LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 05/21/21. Office location: NY County. Princ. office of LLC: Tyler Haydell, 9 W. 31st St., Apt. 36F, NY, NY 10001. 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 Formation of LOKI HOSPITALITY LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 05/11/21. Office location: NY County. SSNY designated as agent of LLC upon whom process against it may be served.

SSNY shall mail process to Manuel Coccaro, 1275 Valley Brook Ave., Lyndhurst, NJ 07071. Purpose: Any lawful activity.

Notice of Formation of CPG TRIBORO PORTFOLIO MANAGER LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 06/15/21. Office location: NY County. Princ. office of LLC: 419 Park Ave. South, Ste. 401, NY, NY 10016.

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: Real estate.

NOTICE OF FORMATION OF THREE BEARS CAPITAL, LLC. Articles of Organization filed with Secretary of State of NY (SSNY) on 05/25/2021. Office location: NEW YORK County. Principal office of LLC: 380 LENOX AVE., APT #10E, NEW YORK NY, 10027. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail a copy of any process against LLC to address of its principal office. Purpose: any lawful act or activity

FELICE HUDSON, LLC, Arts. of Org. filed with the SSNY on 05/28/2021.

Office loc: NY County. SSNY has been designated as agent upon whom process against the LLC may be served.

SSNY shall mail process to: SA Hospitality Group LLC, 950 Third AvenueSuite 500, NY, NY 10022. Purpose: Any Lawful Purpose.

Notice of formation of Metosis Studios LLC. Articles of Organization filed with the Secretary of State of New York (SSNY) on 02/01/2021. Office location: Bronx County. SSNY is designated for services of process. SSNY shall mail a copy of any process served against the LLC to 2804 Gateway Oaks Dr # 100 Sacramento, CA 95833. Purpose: any lawful purpose

STREET FOOD CHAAT LLC, Arts. of Org. filed with the SSNY on 05/ 24/2021. 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, 176 Bleecker Street, NY, NY 10012. Purpose: Any Lawful Purpose.

ROADRUNNERS ENTERTAINMENT LLC. Arts. of Org. filed with the SSNY on 05/05/21. 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 Entertainment, P.O. Box 910, Westbury, NY 11590.

Purpose: Any lawful purpose.

GH Venture Partners, LLC filed Arts. of Org. with the Sect’y of State of NY (SSNY) on 6/8/2021. Office: NY County. SSNY has been designated as agent of the LLC upon whom process against it may be served and shall mail process to: The LLC, 410 Park Ave, Ste 730, NY, NY 10022. Purpose: any lawful act.

Notice Of Formation Of OUR FIRST LABOR AND DELIVERY SERVICES LLC. Articles of Organization filed with the Secretary of State of NY (SSNY) on 03/22/2021. 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: 641 LEXINGTON AVE 13TH FLOOR NY, NY 10022. The principal business address of the LLC is: 641 LEXINGTON AVE 13TH FLOOR NY, NY, 10022. Purpose: any lawful act or activity.

NOTICE FOR FORMATION of a limited liability company (LLC). The name of the limited liability company is NTT PROPERTIES LLC. The date of filing of the articles of organization with the Department of State was April 14, 2021.

The County in New York in which the office of the company is located is New York. The Secretary of State has been designated as agent of the company upon whom process may be served, and the Secretary of State shall mail a copy of any process against the company served upon him or her to The LLC, 182 2nd Avenue, Apt 2, New York, New York 10003. The business purpose of the company is to engage in any and all business activities permitted under the laws of the State of New York.

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37-week season, with more than half of the money spent touring.

During the pandemic, the number of employees sank to 30, from 86, Glass said, adding that she prioritized keeping the company artists employed.

In late 2020, $4.5 million from the Ford Foundation became the dance troupe’s largest gift to date, Glass said. Now, with $10 million additional in the bank, she said she is thinking strategically about the future, especially the work the institution does at the intersection of art and equity.

In the past, that has meant ensuring that all students have tights that match their skin’s hue, so they know they can bring their true self to the studio. Going forward, Glass

FROM PAGE 3

throughout the Covid-19 pandemic. She alternated weeks when staff was furloughed, to stretch the safety-net funds from her bank account

“THIS IS ALLOWING NONPROFITS TO BE AMBITIOUS” further.

It’s not the first time that the ballet company has struggled. In 2004, before Glass was there, it shut down for months because of a $2.3 million deficit.

In recent years, Glass said, donations have amounted to about $2.75 million annually, funding a

said, she wants to push ballet as an art form to be more inclusive.

“There are more ballets and more stories that we want to be able to tell,” she said. “But it’s challenging to have creative freedom when you are focusing on trying to make the day-to-day happen, to take risks when you don’t have anything to fall back on.”

Amazon money Generally, an institution with a $10 million endowment could expect at least $300,000 in annual income if it invested the entirety of the new gift.

Scott’s latest largesse follows a 2019 pledge to give her fortune away. This is the third time in a year that she has distributed billions of dollars to a group of organizations.

In spite of her efforts, she is worth more than ever—$60 billion, according to Forbes. ■

ELECTIONS

ENERGY

Startup gets $16M boost, with help from Robert Downey Jr.

BUCK ENNIS

BY RYAN DEFFENBAUGH

A

ADAMS campaigns in April near Borough Hall in Brooklyn.

city reopened and Covid-19 became less of a concern to voters, Yang’s optimistic message of hope and recovery seemed out of place.

A rise in crime, including high-profile shootings in Times Square and homelessness, underscored the

Crain’s emphasized the need for the next mayor to tame the spread of violent crime. They said Adams' 22 years in the New York Police Department gave him credibility, and his more moderate stances would help business as the recovery takes hold.

“People want to feel safe,” said Eric Benaim, CEO of Modern Spaces, a Long Island City real estate firm.

“And they won’t go back to the office if they don’t feel safe walking the streets and taking the subway.”

Adams' pragmatic approach to development has also won him supporters.

"He would’ve supported something like an Amazon deal. He understands how important business is for a thriving city and the importance of public safety," Bess Freedman, CEO of Brown Harris Stevens, said.

Adams’ relationship with small-business owners is providing executives with hope for a broader economic comeback. As borough president of Brooklyn, where 84% of businesses have fewer than 10 employees, Adams has made his presence felt in the mom-and-pops that form the backbone of the borough.

Now Adams hopes to establish a similar rapport with constituents across the city. ■

“I THINK ERIC ADAMS UNDERSTANDS ... QUALITY OF LIFE ISSUES”

Yang recedes Adams’ ascent, which began during the spring as public safety became the dominant campaign focus, came in part at the expense of Andrew Yang, the celebrity entrepreneur and presidential contender who finished fourth after leading public polling for much of the year.

For Yang supporters, it was seemingly an end to a lightning-like political journey, one that began only two years ago, when the 46-yearold caught fire as the first mainstream Asian American presidential candidate.

Yang's campaign manager, Chris Coffey, acknowledged that once the

need for a more experienced leader, not a political neophyte.

“As the city descended more in chaos, Adams became more significant,” said Hank Sheinkopf, a political consultant. “The day those shootings occurred in Times Square is the day everything kind of shifted away from Yang.”

Great expectations Adams is supportive of “reasonable” real estate development, whether housing or commercial, that drives jobs and opportunity, said Randy Peers, president and CEO of the Brooklyn Chamber of Commerce.

"I think Eric Adams understands public safety and quality-of-life issues as they relate to the city's economic recovery," Peers said.

Executives who spoke with

26 | CRAIN’S NEW YORK BUSINESS | JUNE 28, 2021

Midtown-based startup is taking its model of financing home energy upgrades national—with help from Iron Man, Robert Downey Jr. Downey’s climate-focused venture capital fund, the FootPrint Coalition, is among the investors in a $16 million venture capital round for Sealed, a nine-year-old startup that helps homeowners cut energy costs. The deal, which closed last Thursday, will allow the company to expand its reach beyond Long Island and the city’s outer boroughs, starting with Connecticut and New Jersey.

Sealed covers the upfront costs for shifting a home from gas to electric, as well as improving insulation and installing smart home technology.

The company pays itself back by collecting the money that the upgrades have produced in energy savings.

“The big question we had when we started the company was why people weren’t taking advantage of these really cost-effective energy upgrades that have been available,” said Lauren Salz, chief executive of Sealed. “It is too much of a hassle and too expensive.”

To make it easier, Sealed covers the cost of work up to $100,000, with an average project cost of $30,000, and hires and manages contractors to make the home upgrades. Sealed has an incentive to do the job correctly and as cheaply as possible, Salz said. If the homeowner’s electricity bill doesn’t decrease, Sealed won’t make any money. The typical contract is 20 years.

The company’s green focus drew the attention of Downey, whose FootPrint Coalition fund launched in January.

“There’s roughly $50 billion in wasted energy leaking out through the roofs of more than 33 million homes across the United States. We

love the promise of Sealed,” Downey said in a statement.

Venture firm Fifth Wall joined the movie star in leading the funding round. Sealed is the first investment out of a new climate-focused fund from Fifth Wall, a venture firm whose investors include CBRE, Cushman & Wakefield, Toll Brothers and Rudin.

Salz and her c o - f o u n d e r, DOWNEY Andy Frank, spent several years doing research and talking with homeowners before landing on the model. In 2016 the company received a $5 million loan from the New York Green Bank, a state-sponsored fund dedicated to clean energy projects.

Sealed also has raised about $33 million in venture capital funding, including its most recent round. It has partnered with utilities Con Edison and New York State Electric and Gas, among others.

AP

FROM PAGE 1

mid-July.

It appears unlikely any of the other candidates will catch Adams, the 60-year-old former city Police Department captain and state senator and current Brooklyn borough president. Adams holds a ninepoint lead over progressive Maya Wiley and an 11-point lead over his moderate counterpart, Kathryn Garcia, with 84% of the first-place votes counted.

Adams won roughly 253,000 firstplace votes of the nearly 800,000 cast for Democrats, for 31% of the total, although more than 90,000 ballots from absentee, mail-in and affidavit voters are outstanding, according to the Board of Elections' figures.

Adams would face Republican Curtis Sliwa in the general election, which is mostly a formality because Democrats hold a substantial advantage over Republicans in total voters in the city.

If elected, Adams would be the city's second African American mayor. David Dinkins served from 1990 to 1994.

“Eric Adams is someone who has been in the public eye for decades and is someone who has a mountain of experience both in activism and government,” said John DeSio, vice president of Risa Heller Communications. “He has a certain level of credibility that comes with that experience, and I think that attracted voters to him, especially on crime.”

MACKENZIE SCOTT

GETTYIMAGES

GRANTS

‘Inevitability’ Salz declined to disclose how many retrofits the company has done in the past year or the firm’s revenue. It employs about 60 people full time, with plans to double that total in the next year.

As Congress and the White House continue to debate a climate-focused infrastructure bill, private markets are increasingly investing in green energy. Venture investment in climate-focused startups last year hit a record $16.4 billion.

The momentum has made it easier for the Sealed team to get investors on board, compared to a decade ago.

“There’s a feeling of inevitability now,” Salz said. “These issues have to be addressed both through public support and private companies.” ■

BUSINESS SPOTLIGHT

RALLY/ROB PETROZZO

RALLY users can buy shares in LeBron James’ sneakers and classic cars.

FOCAL POINTS

A slice of luxury: SoHo startup rises by selling shares in pricey collectibles Rally caters to a generation of young investors exploring alternatives to the stock market

BY RYAN DEFFENBAUGH

I

t has been a busy season for initial public offerings—and not just for technology startups.

One marketplace has recently offered $10 shares in LeBron James’ high school sneakers (a gift from Kobe Bryant) and $25 shares in a rare early print of the Declaration of Independence.

That is the world of Rally, a SoHo-based startup that allows investors to buy fractional ownership in collectibles, ranging from rare wristwatches to dinosaur bones. The company is part of a rising technology-enabled industry that is offering stock market alternatives to a class of mostly new and young investors.

“There are so many interesting assets, collectibles, that people want to interact with, but they can’t,” said Rally CEO George Leimer, a former Disney and eBay executive, who joined the startup in the fall.

Most people can’t afford to dabble in the luxury market. But by offering low-cost slices of $180,000 sneakers or bottles of aged wine, Leimer says, Rally is democratizing access to high-end collectibles.

The company purchases items at auction, then registers them with the U.S. Securities

and Exchange Commission as entities in order to sell securities in the collectibles.

The access is theoretical—the Declaration of Independence is safely stored away—but Leimer said the investments often have a sentimental value for Rally users.

There are risks, of course. The “companies” that Rally sets up for each item do not generate revenue, and so the value is largely subjective.

Early innings Launched four years ago as Rally Rd, with a focus on classic cars, the startup last month raised a $30 million venture capital investment round to help expand on its base of about 250,000 investors.

The company has about 300 items up for trading, worth roughly $30 million total. The firm—which declined to share its revenue data—makes money through a sourcing fee of about 7% on each item’s acquisition cost, which is included in the pricing of the initial public offering.

There have been 15 “exits” among Rally assets, in which at least half of shareholders agree to sell the item to a private bidder, which offered an average return of 35%, according to data from Altan Insights, a research firm that tracks what it calls the frac-

tional share alternative asset investment space.

It is still “the first inning” for online collectible investing as a whole, said Russell Lieberman, CEO of Altan Insights. There are about $200 million worth of assets available for investing across Rally and four other competitor marketplaces that Altan tracks.

“Marketplaces are increasingly focused on building a community around a single passion,” Lieberman said. “Rally was early and has been able to successfully focus on a wider range of interests, but I think we’ll see more specialists pop up.”

Trading buzz Similar to the smash-hit stock-trading app Robinhood, investors in fractional collectible apps skew younger. The average age of investors on Rally is 28, Leimer said.

The extra time at home for many during the pandemic and the financial boost of several stimulus checks have spurred people to take a more active interest in investing, said Nick Colas, co-founder of DataTrek Research. About 15% of current U.S. stock market investors say they began investing in 2020, according to a survey from Charles Schwab.

“The question is whether it stays that way

FOUNDED Friends Rob Petrozzo, Christopher Bruno and Max Niederste-Ostholt launched Rally in 2017.

FULL-TIME EMPLOYEES About 30 CEO George Leimer FUNDING Rally has raised about $60 million from venture capital investors in separate deals.

PRODUCT MIX The firm’s app allows users to buy shares in historical documents, classic cars, rare sports cards, comic books and other collectibles.

GROWTH STRATEGY The company will use $30 million in venture capital and a $50 million debt facility to expand its range of collectibles for investing, such as the red-hot digital collectibles known as non-fungible tokens.

as the world opens up,” Colas said.

The collectibles market has heated up during the pandemic, Colas noted, and often becomes popular at times people are concerned about inflation.

In the coming weeks, Rally plans to reopen a showroom that it launched in SoHo in 2019 but closed because of the pandemic. Along with its venture capital funding, the company in May secured a $50 million debt facility to purchase more collectibles.

“There are very few limitations on the types of things that Rally can offer,” Leimer said. “If it is something people are passionate about but haven’t had access to, then it belongs on Rally.” ■ JUNE 28, 2021 | CRAIN’S NEW YORK BUSINESS | 27

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