Building blocks:
By Katherine Clarke
How many buildings do you own? Korman Communities has 26 total properties across the country, with 7,000 units. AKA [Korman’s extended-stay brand] has nine properties, including four in New York, with roughly 100 units per property.
How long has your family been in the real estate business? My great-grandfather started out developing land in Philadelphia — along with his two sons — and building homes. They built about 3,000 homes over about a 40-year period, and then my father and grandfather started developing multifamily residential buildings. How did you get into the family business? I started working in the summer from age 10, and then from age 16 every weekend and every summer. I was cleaning the toilets, doing the landscaping, picking weeds, learning how to change outlets and fix air-conditioning. How did Korman start operating extended-stay properties? My father developed a circular high-rise in Center City, Philadelphia, in the early 1960s. Due to the apartments’ pie-shaped floor plans [which made them unsuitable for tra-
Vital Stats: Name: Larry Korman Age: 49 Hometown: Philadelphia Title and Company: copresident of Korman Communities, president of AKA Currently living in: Fort Washington, Pa.
ditional layouts], he created the first luxury furnished short-term suites with hotel-like services. … In 1995, my brother, myself and my father wanted to take what we had established national. We started purchasing new apartment buildings in Delaware, Virginia, North Carolina and Georgia. ... When we got to New York [in 2005], we realized that in order to be very luxurious, our buildings had to have 100 suites or less. That was different from our traditional garden-style apartments, and therefore needed to be part of its own brand, AKA, which stands for A Korman Accommodation. Are you looking for more buildings? The next priority for AKA is definitely to open up a property in downtown Manhattan, in Soho or Tribeca. We might go with new construction, which we haven’t done, to build it exactly the way in which we envision it. We’ve been working on it for four years and we’ve identified some potential locations. We’re hoping to start by the end of this year. It could be two years until it opens.
Landlord life: What’s been your strangest tenant experience? A couple of years ago during the presidential election, the Secret Service for Barack Obama, Hillary Clinton and John McCain were staying with us all at the same time [in the Washington, D.C., AKA property]. We had our restaurant open 24 hours a day to meet the needs of the Secret Service coming in and out. And when Obama was elected, we had the governor of New York stay with us, Sting — a whole host of interesting celebrities. It was like a weeklong block party. We had a fleet of electric golf carts taking people out and about. Do you have a lot of celebrities staying in your properties? Throughout all of 2011, we had the entire production staff of “Men in Black 3” in our Central Park property. One of the odd requests we got was Will Smith asking if we could close our fitness center from about 7 p.m. till 9 p.m. so he and [then-wife] Jada could work out, even though they were the only members of the production not staying there. I said, “You’re absolutely welcome to use it, but … we don’t close anything off to any resident.” He ended up getting his own workout trailer. … The very first apartment Will Smith ever lived in was a Korman Suites building in Philadelphia. I had just graduated college and I was in the office by myself when he and Jazzy Jeff came in. They had just purchased a gold BMW with gold wheels, and someone had just stolen all the wheels off of it. They were very upset. I remember thinking that Will was the one that was very flustered, Jazzy Jeff was very cool.
The bottom line: What do you charge in AKA buildings? AKA rates in New York City are approximately $295 per day for monthly stays, $495 per day for weekly stays and $695 per day for daily stays. Our rates fluctuate based on season and suite type.
AKA Times Square
66 August 2012 www.TheRealDeal.com
Are you raising or lowering rates across your portfolio? They were at their high in 2008, their low in 2009 and have been slowly coming back up in 2011 and 2012. They’re back to where they were in 2008 now. TRD
Manhattan
AKA’s New York properties —
PHOTOGRAPH FOR THE REAL DEAL BY CHRIS MARTIN