The Real Deal February 2012 by The Real Deal

NYC vs. N.J. in ﬁght for ofﬁce tenants

Cutting broker incentives in half

NYC developers buy up Brazil

Kevin Roche: A career in review

104

Don Peebles takes on NYC

THEREALDEAL

www.TheRealDeal.com

Brookﬁeld’s grand NYC plan

West Side mega-project is just the start for Canadian firm BY ADAM PINCUS If Brookfield isn’t keeping its rivals up at night, it should be. The historically quiet firm has an unSPECIAL REPORT precedented amount of NYC office space on the market (more than any other landlord) and a massive level of activity in the works. A Manhattan mega-project and possible bid to convert Stuy Town to condos are just the start.

N EW YO R K R E A L E S T A T E N E W S

Vol. 10 No. 2 February 2012 $3.00

The luxurylist A neighborhood ranking of Manhattan brokers on $5M-plus deals From left to right: Prudential Douglas Elliman’s Hervé Senequier and Leonard Steinberg, the top luxury brokers in Chelsea, and Brown Harris Stevens’ Kathy Sloane, who made the top brokers list on the Upper East Side and in Midtown East.

FACT The 10 largest ﬁrms reported to be in the market for Manhattan ofﬁce space are hunting for as much as 11.3 million square feet in total. See page 24.

AT A GLANCE The mighty middle Demand for luxury homes has continued to increase in 2012, and sales of starter apartments have remained sluggish. But the middle of the Manhattan market — properties priced in the $1 million range — ﬁnally seems to be waking up. See page 16.

See story on page 56

Who will replace Bloomberg?

NYC’s mayoral candidates

NYC investors sniff out deals in Europe

BY JAKE MOONEY A long line of candidates is waiting in the wings to move into Mayor Michael Bloomberg’s City Hall ofﬁce once his term is up. This month, TRD looked at each of them and what they would mean for the NYC real estate industry.

As Europe’s economic uncertainty persists, investors, many with ties to NYC, have started searching the continent for deals. Barry Sternlicht, Howard Michaels and the Blackstone Group are all looking for bargains there. See page 48.

and their real estate ties

See story on page 28

Co-op shareholders feel the squeeze

Astor master

Minskoff goes after tenants for Astor Place spec tower

BY ADAM PIORE Developer Edward Minskoff made headlines when he locked up a giant construction loan for a rare spec ofﬁce tower on Astor Place. Now he’s turning his attention to nailing down tenants. See story on page 40

BY LEIGH KAMPING-CARDER It’s always difﬁcult to rank the city’s top residential agents, given the lack of public information about their deals. But for the FEATURE STORY ﬁrst time, TRD has compiled a ranking of luxury sellers’ agents based on closed sales, rather than listings. And we’ve drilled down even further, discovering who reigned supreme

in different corners of Manhattan when it came to resales of $5 million and up in the past year. For most of the brokers, the key to dominating a neighborhood was securing one mammoth sale. But a select few — Serena Boardman and John Burger among them — cornered the market on both volume and big-ticket deals.

Many Manhattan co-op owners who didn’t want to sell during the downturn got board permission to rent out their homes instead. But now, many of those agreements are expiring, squeezing owners and boards. See page 50.

See story on page 43

The rise of Checking in on the ’burbs Rapid Realty A breakdown of the priciest residential sales in Franchise ﬁrm grows fast, but not without its critics

Ian Schrager on getting shy at cocktail parties See page 106.

Fairﬁeld, Westchester, Bergen and Nassau

BY KATHERINE CLARKE Since the residential brokerage Rapid Realty started franchising in 2009, it’s mushroomed to nearly 800 agents in some 50 NYC locations. Now, the ﬁrm is looking to expand beyond the city and even the country. But some criticize the ﬁrm’s “assembly-line” approach to doing rental deals.

BY PETER KIEFER It’s a question many New Yorkers ask themselves at some point: Buy an apartment in the city, or spend the same amount on a spacious house in the suburbs? When choosing the latter, Priciest sale by county, 2011 New Yorkers often flock to a few affluent counties outside the city. This Fairfield: $39.5M (Greenwich) month, TRD checked in on these arNassau: $15.9M (Old Westbury) eas to see how their residential markets are holding up and to determine Westchester: $11.6M (Rye) their priciest sales of 2011 — some of Bergen: $10M (Saddle River) which involved celebrity owners like hip-hop mogul Russell Simmons.

See story on page 30

See story on page 60

The REBNY churn A ﬁrst-ever analysis of REBNY membership to see who joined (and who dropped out) this year. See page 34.

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Highlights F E B R U A R Y 2 0 1 2

Mid-priced apartments move The middle market is suddenly stronger, while homes under $1 million linger.

liaisons 18 Lender Home sellers take action, securing lenders

Who will Fresh Direct choose: the Big Apple or the Garden State?

for their buyers to quicken sales.

vs. the Garden State 20 NYC Ofﬁcials on both sides of the Hudson try wooing Fresh Direct and others.

dunk 22 ACitySchlamm Connections’ David Schlamm talks

Grateful Dead and being 21-years sober.

words... 26 InThistheir month’s funniest and most insightful comments.

David Schlamm

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Christine Quinn

The other upcoming election A look at the NYC mayoral candidates — from Christine Quinn to John Catsimatidis — and their real estate ties.

Scott Stringer John Catsimatidis

rise of Rapid Realty 30 The Firm’s assembly-line approach leads to

fast growth, but garners criticism.

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estate’s red carpet affair 32 Real Photos of the industry big-shots who

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gathered for REBNY’s annual gala.

Rapid Realty founder Anthony Lolli (far right) and franchisees in Brooklyn.

a look at REBNY membership 34 And A breakdown of which big-shots are joining (and leaving) the club.

costs set to skyrocket 36 Homeownership The tax write-off changes every residential broker should know about. wish list: A Queens convention center 36 Cuomo’s Governor Andrew Cuomo unveils plans for a massive meeting facility at Aqueduct Racetrack.

incentives in half 38 Cutting As residential rental market improves, partial-month incentives replace OPs, or commissions paid by landlords.

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Edward Minskoff

8 February 2012 www.TheRealDeal.com

Astor master With a mega construction loan in hand, Edward Minskoff is betting the bank on his speculative Astor Place ofﬁce tower.

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Highlights continued luxury list 43 The A neighborhood-by-neighborhood

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ranking of Manhattan luxury resale brokers.

investors in Europe 48 NYC Developers and private equity ﬁrms sniff out deals in imploding economies on the continent.

From left: Elliman’s Hervé Senequier and Leonard Steinberg and BHS’s Kathy Sloane.

Co-op owners out of time Shareholders ask boards to extend expiring rental allowances.

Meet the landlord

Brookﬁeld’s big bet

Treetop Development’s Adam Mermelstein talks about being named the city’s worst landlord and says he was falsely accused.

The ﬁrm ramps up its NYC presence with a mega ofﬁce project and more.

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Commercial Market Report Tracking rents and vacancy ﬁgures in Manhattan’s three ofﬁce districts.

From left: Brookﬁeld’s Jerry Larkin and Cushman & Wakeﬁeld’s Bruce Mosler.

National Market Report Reports from around the country on signiﬁcant developments and trends.

The ’burbs A look at the wealthiest, just-outside-NYC counties, including their top deals.

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The Deal Sheet A roundup of ofﬁce and retail leases, building buys and ﬁnancing.

Rio de Janeiro

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Residential Market Report Checking in with brokers to take the pulse of the apartment market.

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Buying up Brazil A look at the NYC real estate players investing in the South American nation.

Calendar of Events Check out this month’s activities.

100

Developments Updates An update of the construction and sales status of projects around the city.

104

Comings & Goings

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10 February 2012 www.TheRealDeal.com

Schrager’s genius plan 106 Ian The hotelier talks about lawsuits, love and the inspiration for his new hospitality brand: The Genius Bar.

The stories behind the latest job moves and company announcements.

105

We Heard A lighter look at industry buzz.

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THE REAL DEAL N E W YO R K R E A L E S T A T E N E W S PUBLISHER Amir Korangy EDITOR-IN-CHIEF Stuart W. Elliott MANAGING EDITOR Jill Noonan DEPUTY MANAGING EDITOR Candace Taylor WEB EDITOR Lauren Elkies ART DIRECTORS Ronald Gross, Derek Zahedi SENIOR REPORTER Adam Pincus REPORTER Leigh Kamping-Carder WRITERS Catherine Curan, Melissa DehnckeMcGill, Ken Harney, C.J. Hughes, David Jones, Adam Piore PRODUCTION MANAGER & RESEARCHER Linden Lim EDITORIAL ASSISTANTS Adam Fusfeld, Katherine Clarke, Guelda Voien ILLUSTRATORS David Cole, Yishai Minkin PHOTOGRAPHERS Max Dworkin, Michael Toolan, Marc Scrivo DIRECTOR OF MARKETING OPERATIONS Yoav Barilan ASSOCIATE SALES DIRECTOR Ross Fox ADVERTISING SALES Eran Evron, Abi Laoshe, Joseph Paci, Robert Stearns WEBMASTER Nima Negahban ACCOUNT COORDINATOR Andrea Moreno ADMINISTRATOR Junaid Zahid CIRCULATION Paul Destanko DISTRIBUTION Mitchell Newman, Michael Presto VIDEOGRAPHER Toni Comas

A TESSLER DEVELOPMENT W W W. T E S S L E R D E V E L O P M E N T S . C O M

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12 February 2012 www.TheRealDeal.com

ATTORNEY Barry J. Friedberg Trachtenberg Rodes & Friedberg ACCOUNTANTS William T. McCallum, CPA, P.C., Christine Wang The Real Deal is a registered trademark of Korangy Publishing Inc. Copyright © 2012. Call 212-2601332 or e-mail news@therealdeal.com. Warning: It is illegal to photocopy or reproduce any part of The Real Deal without express written consent. For reprints and duplication rights, call 212-260-1332. Principal ofﬁce: 158 West 29th St., New York, NY 10001. The Real Deal is published monthly. Annual subscriptions cost $95. Send check or money order to 158 West 29th St., New York, NY 10001.

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ne fixture of every presidential election — including this one — is the battle between candidates over what they’ve earned and what’s been given to them in life. Mitt Romney, son of a prominent politician and a product of the corporate establishment, like George W. Bush before him, has faced an uphill battle trying to shed that image. President Obama, on the other hand, may have challenges in the upcoming election, including diminished support from the business community, but he still has the advantage of his upfrom-bootstraps life story. This tension between the self-made success and the wellconnected corporate operator is one that plays out in several stories in this issue. In our profile of Edward Minskoff, starting on page 40, we look at the prominent developer who’s had a long history of betting on the market — and getting it right. This time around, Minskoff is building a speculative office tower in Astor Place, at a time when erecting a commercial building with no tenants lined up is not for the faint of heart. Despite being the grandson of legendary developer Sam Minskoff, the younger Minskoff arrived in New York in the 1960s with only a beat-up used car and a few hundred dollars, he told our reporter Adam Piore. Minskoff’s uncles and cousins who controlled the family real estate empire did not get along with his side of the family, and Minskoff has long insisted that he “never took a penny from [his] family.” Much of his early success, he says, was motivated by a “chip on his shoulder” against

The tension between the self-made success and the well-connected corporate operator is one that plays out in several stories in this issue of The Real Deal. them, which instilled in him a desire to prove he could make it on his own. Meanwhile, on page 30, we take a look at Anthony Lolli, the young founder of Rapid Realty, who’s emerged from nowhere to put down his stake in the outer boroughs real estate world. Still an unknown to most Manhattan real estate pros, Lolli has quietly built up a franchise network of residential brokerages with 51 locations in the city, and more than 800 agents, putting it up there with the biggest firms in the city. The company has garnered critics, but Lolli — raised in modest circumstances in Brooklyn by an Ecuadoran immigrant mother, who he’s still extremely close to — appears to have sold many on his rags-to-riches story in his quest to expand. On the more privileged and well-connected front, our profile of Brookfield, starting on page 56, highlights the expansion of one of the biggest corporate players out there (besides real estate, the company also controls coal-shipping terminals and even makes bags for fast-food restaurants). Of course, the advantage of being a corporate behemoth is scale — Brookfield plans to spend a massive $6 billion in the city over the next eight years on its real estate projects, including the gigantic 5.4 million-square-foot Manhattan West development near Penn Station, reporter Adam Pincus writes. Lastly, in our cover story, we look at the brokers operating in Manhattan’s luxury market, many of whom have risen up through the ranks by their own efforts and others who have built on the societal connections they came into the business with. Neighborhood by neighborhood, we rank the agents who have done the most resale deals over $5 million in 2011. It’s interesting to note that in the current political climate (post-Wall Street meltdown, and in the midst of a growing divide between Republicans and Democrats) some on the left are arguing that the self-made narrative is a harmful myth that allows Wall Streeters and other finance types to pretend that help from society (and government) didn’t contribute to their success. Whether the self-made argument is a myth or not, I think it’s safe to say that those who cast themselves as self-made successes make for compelling stories. So definitely check out those profiles. And don’t forget to check out our Data Book 2012, which is polywrapped with this issue. It’s our annual almanac of the top deals, top players, price trends and everything else connected to New York City real estate. I challenge you to flip through it and find new information you don’t know. It’s the one book you should keep on your desk throughout the year as a handy reference. Enjoy the issue and enjoy the Data Book!

Stuart Elliott 14 February 2012 www.TheRealDeal.com

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The mighty middle

The market for mid-priced Manhattan properties wakes up, but homes under $1 million linger

BY LEIGH KAMPING-CARDER Central Park West mansion belonging to retired Coach executive Keith

RESIDENTIAL MARKET R EPORT

Monda sold last month for $22.4 million, a record price for a singlefamily townhouse on the Upper

West Side. The purchase kicks off the New Year with echoes of 2011: luxury real estate maintaining (or even exceeding) its pre-crash values, and a wealthy foreigner — in this case, international buyer Igor Iankovsky — swooping in to own a piece of New York City. But the rest of the residential market last month was inconsistent, brokers said; while there’s

strong demand for mid-priced properties, sales of properties under $1 million are sluggish. Monda, who was the president and chief operating ofﬁcer of Coach until 2008, put his 13-room townhouse at 247 Central Park West on the market in April 2010, asking $32 million. The renovated 12,270-square-foot home, built in 1887, features a 60-foot indoor lap

pool, a gym and a roof terrace. Though the property eventually sold for 30 percent off its initial asking price, the sale brought Monda a sizeable return. He had bought the house just two years earlier from Abigail Disney, Walt’s grandniece, for $15.5 million.

like it did in 2011 (see related Q&A on page 68). Meanwhile, starter apartments linger on the market. Unlike last year, however, the middle of the market also appears to be waking up. In the last month, more and more buyers bid on homes priced

While buyers complain about a lack of inventory in the $1 to $2 million range, sellers are listing more properties priced between $800,000 and $1 million. So far in 2012, brokers said, demand has increased for this and other high-end properties, much

from $4 to $5 million, a sector that was a “difficult market to see traction with” in the past, said Frances Katzen, a managing director at Prudential Douglas Elliman. New development specialist John Gomes, also of Elliman, said he, too, has noticed “lots of activity” at price points between $3 and $5 million. The market for properties priced slightly lower than that, however, is showing weakness. While buyers complain about a lack of quality inventory in the $1 to $2 million range, sellers are listing more properties priced between $800,000 and $1 million, according to Fanny Montalvo, the managing director of sales at A.C. Lawrence & Company. “There is some great product under $1 million that’s currently just sitting there,” said Barak Dunayer, president of Barak Realty. In part, that’s because buyers at the lower end of the market are more susceptible to broader economic uncertainties and the difficult mortgage climate, he said. Smaller apartments, meanwhile, are falling out of favor, as those buyers who can afford to purchase property look for larger units that can serve as longerterm investments. An increasing number of buyers, mindful of obtaining the best value, are nabbing apartments “that will be flexible enough for future life changes,” said Bond New York agent Bruno Navarro. For example, he said, many buyers are now choosing to purchase junior one-bedrooms rather than studios. Another common transaction right now, he said, is that first-time buyers purchasing “junior four” apartments (one-bedroom units with an alcove or office that can be converted to another bedroom). “Most of the activity that we are seeing today is from buyers who are interested in holding on to a unit for the long run, as opContinued on page 92

16 February 2012 www.TheRealDeal.com

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change, brokers say. Taking a page from developers’ books, owners of resale apartments have started approaching lenders — before they even have a buyer in place — to ﬁnd an institution that will lend in their building. Then, when they do ﬁnd a purchaser, they specify in the sales contract that the purchaser must approach this preferred lender for a mortgage within a certain amount of

time. That way, the seller feels confident that a qualified buyer will be able to get financing, and they can avoid wasting time on a deal that may fall through. These preferred lender relationships were virtually non-existent in New York resales during the boom, but now, “it’s a whole new world,” said Leslie Modell Rosenthal, managing director at Warburg Realty. “I come across it

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occupancy, commercial tenants and other areas of concern for banks. Then, the seller — often with the help of a mortgage broker — brings the completed questionnaire to various lenders and asks them to pre-approve the apartment for a loan, explained Rolan Shnayder, director of new development lending at H.O.M.E mortgage bank. With a lender in place, the seller can put a preferred lender clause in the sales contract. Usually, this requires the buyer to approach the designated lender for a mortgage pre-approval within a certain amount of time. The purchaser is free to get ﬁnancing elsewhere if they ﬁnd better terms, but the seller knows that at least one bank will likely give the buyer a mortgage. That, Shnayder said, eases sellers’ concerns about the mortgage contingencies that today’s buyers demand in virtually every sales contract. Having a preferred lender requires the purchaser to make a good-faith effort to get a mortgage, rather than using the mortgage contingency clause as an excuse to back out of the deal, he said. Shnayder said about 5 percent of his resale clients are now stipulating preferred lenders in sales contracts. Until now, that was virtually unheard of outside of new developments. “It’s standard in new development [contracts],” Shnayder said. “Why shouldn’t you have the same language [for] a resale unit?”

Saving time Finding a preferred lender means more work for the seller’s agent and mortgage broker, but it can ultimately save time by ensuring that the deal closes faster, brokers said. Shnayder estimated that some 10,000 condo units in New York City are considered non-warrantable, or ineligible for backing by Fannie Mae and Freddie Mac, because they don’t meet certain qualifications — a 10 percent reserve fund, for example. If a building is non-warrantable, many banks won’t lend there. But many sellers don’t realize their buildings are non-warrantable until they find a buyer who then tries (and fails) to get a mortgage. This means the deal is likely to fall through, wasting months of seller’s time. “If you find a buyer who’s going to get a loan and then find out 45 days into contract that they can’t close, then you have to re-list the Continued on page 90

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N.J. and NYC go head-to-head to lure in companies Compiled by Russell Steinberg

Jersey jobs

In recent years, the Garden State has been on a mission to lure businesses away from NYC. Last month, N.J. Gov. Chris Christie signed a bill that earmarks $200 million in tax breaks to eligible companies moving to or staying in the state. Companies will be credited up to $8,000 a year for the next 10 years for each job created or retained.

Fresh competition

One of Christie’s first targets is Queens-based online grocer Fresh Direct. Last month, Christie offered the retailer $100 million in tax breaks and perks to move to the Garden State. The company, which has received about $2.5 million in tax breaks and incentives from New York State and City over the last 10 years, has 1,800 employees. (New York Times)

Time to move

Time Warner is evaluating its NYC real estate holdings because, as the company’s CEO said, operating in the city is “extremely expensive.” The media giant occupies 10 city buildings and spends roughly $300 million on office space a year. But the company, which owns its Time Warner Center headquarters, said last month it is looking at space outside the Big Apple, possibly in N.J. or Connecticut. (The Hollywood Reporter)

Bribes to the bottom

When N.J. tried tempting the food coop from the Bronx, Bloomberg suggested that the state was “bribing” the company and said when cities and states attempt to one-up each other it becomes a “race to the bottom.” (New York Times)

20 February 2012 www.TheRealDeal.com

Picking the Big Apple

NYC countered with a deal it hopes will keep Fresh Direct on this side of the Hudson River. Bronx Borough President Ruben Diaz Jr. offered the company about $112 million in cash and tax breaks to move to a 500,000-square-foot headquarters and warehouse in the borough, and, according to the New York Post, Fresh Direct is leaning toward accepting.

Hunts Point stays put

N.J.’s attempt to snag Fresh Direct comes just eight months after Christie’s failed bid to bring in Hunts Point Terminal Produce Cooperative, currently based in the Bronx. Christie offered the company a $200 million incentive package. (Wall Street Journal)

Science sector

N.J. isn’t the only state trying to attract tenants from other locales. NYC is aiming to create science jobs, which could be lured from the likes of San Francisco and Boston. Mayor Michael Bloomberg recently announced approval for Cornell University to develop a $2 billion, 2 millionsquare-foot Roosevelt Island campus. The city will kick in $100 million and expects the project to create 8,000 permanent jobs.

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PHOTOGRAPH FOR THE REAL DEAL BY JAMES CHANG

the

Schlamm has Grateful Dead memorabilia all over his office. This framed album — “Wake of the Flood” — was one of two that he “listened to compulsively” in the 1980s, when he first got turned on to the band. “There’s actual vinyl in there,” he says. He now follows a Grateful Dead cover band called Dark Star Orchestra, which he’s seen roughly 30 times.

n the last few years, a flurry of high-split-commission firms have entered the residential fray in New York. But in David Schlamm’s eyes, they all came late to the party. City Connections Realty, the firm that he founded in 1988, switched to the high-split model in 2004, and has been offering 90 percent commissions ever since. In September, the company, which has 129 agents, opened two new Manhattan “concept” offices — causal offices with no desks — to house virtual agents. “They were being underutilized,” Schlamm says, so this month, he’ll turn them into more traditional spaces, and locate a few permanent agents in each. His West 23rd Street headquarters is also getting an upgrade, including a new look for his corner office, which was recently redecorated by Linda De Niro (cousin to Robert and an agent at the firm). B y J ill N ooNaN

A photo of Schlamm on his 28-foot powerboat “Do the Deal,” which he docks in Haverstraw, N.Y., and sometimes takes out with his Goldendoodle, Oliver, as the only passenger.

A letter to Schlamm from Donald Trump, sent after City Connections agent Steve Savitz rented his secretary an apartment. In it, Trump called Schlamm and Savitz the “second- and third-best dealmakers in the city.”

Desk

o f : D Av i D

which is now in its 18th year. While the event is about showcasing new talent, Suna explained, it also helps boost the off-season economy of the Hamptons, where he owns a home.

Schlamm’s office refrigerator is stocked with Greek yogurt and Pellegrino, both of which have helped him shed 20 pounds in the last three months.

This toy guitar, which is also a clock that lights up in neon, was a gift from City Connections managing director Kathy Dourigan. Schlamm doesn’t play the actual guitar, but says he “plays the air guitar fabulously.”

schlAmm

This “Schlamm Dunk” photo was taken a few months ago. The image runs with his monthly City Connections web column, which goes by the same name. Schlamm says his name has spawned all sorts of puns, including “Schlamm dunk” and “Schlamm the door.”

A photo of his daughters, Emma (17) and Maggie (14), along with his wife, Jill, who he met in the early 1990s after she called the office looking for an apartment. The two met when Schlamm was 45 days “clean and sober.” He is now 21 years sober.

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BY ADAM PINCUS ndustry professionals expected little from the Manhattan ofﬁce leasing market at the start of 2012. And a month into the New Year, they’ve been right in their predictions. Noticeably lacking is a headline-grabbing deal, such as the one that supply-chain ﬁrm Li & Fung inked for 490,000 square

Manhattan ofﬁce stats Manhattan

Availability Average rate asking rent

Dec ’11 Dec ’10

10.9% $51.40 12.0% $47.66

Midtown

11.6% 11.6%

Dec ’11 Dec ’10

C OMMERCIAL MARKET R EPORT

$58.68 $55.38

Midtown South

9.5% $41.91 12.0% $38.23

Dec ’11 Dec ’10

feet in the Empire State Building in the first week of 2011. In fact, a review of office leasing in industry database CoStar Group shows no relocation deals larger than 100,000 square feet in Manhattan through the first three weeks of January.

Downtown

10.5% $37.99 13.3% $37.85

Dec ’11 Dec ’10 Source: Cassidy Turley

Ten of the biggest tenants on the hunt for Manhattan ofﬁce space FIRM

TENANT BROKER

SQUARE FEET SOUGHT

Time Warner

Studley

1.4 million

Credit Suisse

CBRE

1.2 million

Morgan Stanley

Newmark

1.2 million

Citigroup

CBRE

1 million

NewsCorp

CBRE

1 million

Viacom

CBRE

1 million

Jones Day

Studley

500,000

L’Oréal USA

CBRE

500,000

White & Case

JLL

450,000

Jefferies & Company

Cushman

400,000

Source: Industry sources. According to news reports, Time Warner is reevaluating its 4 millionsquare-foot portfolio.

The biggest deal discussed last month was not even for a signed lease, but instead for one in advanced negotiations. Law firm Chadbourne & Parke is expected to lease about 300,000 square feet at 1 World Trade Center, the New York Times reported. Overall, however, commercial real estate pros expect leasing activity to increase as the year progresses. “These deals take a long time to finish,” said David Lebenstein, a senior managing director at Cassidy Turley. “I would imagine you would see announcements through the year, and more in the second and third quarters.” Mark Weiss, a leasing broker and vice chairman at commercial firm Newmark Knight Frank, said the strong activity in 2011 was partly because it was unduly slow in the two prior years. “This year is going to have to stand on its own,” and not rely on pent-up demand, he

said. Plus, Weiss noted, “the largest users, the financial service companies, are likely going to be very quiet.” Yet he is hopeful that other types of firms will grow. “There are plenty of companies that do business in New York that will expand their presence,” he said. To give some perspective, for all of last year, there were a record 51 deals of 100,000 square feet or more, figures from Cushman & Wakefield show. And there are more than 500 tenants in the market at any one time, scouring for between 2,000 square feet and over 1 million square feet, a market report from commercial firm Cassidy Turley shows. Sources said some of the largest tenants looking right now include Time Warner, which is reevaluating its 4 million-squarefoot portfolio, including its headquarters Continued on page 91

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In their words...

The month’s funniest and most insightful comments from real estate pros

“We’ve got too many damn houses. They’re not going to go away. This recovery is going to take a long time.”

“Hell’s Kitchen should not, will not and cannot become a West Side version of Gramercy Park.” Mitchell Moss, a New York University urban planning professor, in response to Hell’s Kitchen residents complaining about bars in the neighborhood. (Wall Street Journal)

Warren Buffett, billionaire investor and Berkshire Hathaway CEO. (Time Magazine)

“It’s fair to say the parties won’t agree on what day it is.” Judge Kevin Gross, in an opinion moving a One Madison Park creditor dispute from a Delaware bankruptcy court to New York State Supreme Court.

“You could have a telescope and look out to see if your nanny is home.” “Most landlords just want their money at the end of the month. But when people start getting murdered at your building, I think it would raise a concern with any landlord.” Retail broker James Famularo, on a landlord’s attempt to evict Juliet Supperclub after two murders were committed on the premises.

Douglas Durst on Bjarke Ingels, the Danish architect designing Durst Fetner Residential’s West 57th Street apartment building. (CNN’s “The Next List”) 26 February 2012 www.TheRealDeal.com

Rapper Vanilla Ice, on how he got into the business of renovating and flipping homes. (AOL Real Estate)

Jones Lang LaSalle’s Scott Panzer, who is handling leasing at office tower 9 West 57th Street, which has a clear view of the luxury apartment building 15 Central Park West.

“He’s annoyingly young and annoyingly brilliant. When you first meet him, you would want to dislike him for those reasons. But … you just can’t help but like him.”

“I had these purple rooms, green rooms and yellow carpet. Totally discotheque. Soon I got sick of it all and thought I’d redo the whole thing myself. And so I did.”

“[It will] cost the state of New York bubkes.” Governor Andrew Cuomo, on his plan for a convention center at the Aqueduct racetrack in Queens. (New York Times)

“It’s not rocket science. … Clean up the banks’ books, and let them start loaning again.” Former President Bill Clinton, on how to fix the housing market, in a speech at Caesars Palace in Las Vegas. (Las Vegas Sun)

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REAL ESTATE & POLITICS

The other upcoming election A look at the NYC mayoral candidates, and their real estate ties

BY JAKE MOONEY ith all the coverage surrounding the upcoming presidential election, New York City’s 2013 mayoral race feels a long way off. But that’s not the case for the politicos running for mayor — or even those rumored to be considering it. Most have already been collecting campaign contributions for months or years, in many cases from prominent figures in the city’s real estate industry. This month, The Real Deal looked at where real estate moguls are placing their bets in the mayoral race — and what each candidate means for the industry. Of course, formal policy proposals and campaign platforms are still far in the future, so most big donors are hedging their bets — contributing to multiple candidates or hanging back entirely. “It’s very early,” said Bruce Mosler, chairman of global brokerage at Cushman & Wakefield. “I don’t guess that a lot of people have decided who they’re comfortable with or want to back, or whether they’ll back multiple players.” Mosler and his wife, Wendy, the managing principal at Miller Global Properties, have each donated to both City Council speaker Christine Quinn and Manhattan borough president Scott Stringer. Still, Mosler said he’s waiting to hear more from each of the candidates before officially backing someone. Below is a rundown of some of the candidates making headlines, how much money they’ve raised as of the most recent campaign finance-filing deadline last month and where they’ve come down on the real estate issues of the day.

Christine Quinn Current position: City Council Speaker (Democrat) Money raised: $4.98 million Real estate contributors: Developers William and Arthur Zeckendorf, Jeffrey Gural

Bill de Blasio Current position: Public Advocate (Democrat) Money raised: $2.02 million Real estate contributors: William Zeckendorf, Durst and Fetner, the Related Companies’ Stephen Ross and Steiner Equity Group’s Douglas Steiner. Background/positions: As a City Council member, De Blasio was a vocal critic of controversial architect Robert Scarano, who’s been charged with ﬁling misleading plans. In 2007, he held a rally at the site of one building in his district, 28 February 2012 www.TheRealDeal.com

of Newmark Knight Frank, the Corcoran Group’s Pam Liebman, developers Harold Fetner and Douglas Durst. Background/positions: Council speaker since 2006, Quinn was a favorite to succeed Mayor Michael Bloomberg in 2009, before he decided to seek a third term. So she’s had ample time to raise money for her 2013 run. Many major New York real estate players donated to her last campaign, including Larry Silverstein, Extell’s Gary Barnett and CBRE’s Mary Ann Tighe. Still, donors say support in that election (from which Quinn retains her campaign funds) does not necessarily equal support in 2013. Quinn — a former housing activist who

360 Smith Street, calling for Scarano’s removal from the project. The architect has since been barred from ﬁling any construction plans with the city. De Blasio, a former regional director for the U.S. Department of Housing and Urban Development who worked as a campaign manager for Hillary Clinton in 2000, is a longtime advocate of rent reform. When running for public advocate, he campaigned to preserve and strengthen state laws that protect rentstabilized tenants from evictions and rent increases.

made history twice by becoming both the first female and first openly gay speaker — has recently been working on a council-wide compromise on the controversial “living wage” bill, which would require developers who get significant city subsidies to pay employees at least $10 an hour. Kenneth Patton, a professor at the NYU Schack Institute of Real Estate and a critic of such measures, said they were a key indicator of whether a candidate will create a development-friendly climate. Joseph Strasburg, president of the Rent Stabilization Association, an industry group representing landlords, said Quinn — like Stringer and public advocate Bill de Blasio — has sought to strike a balance

between prodevelopment and antidevelopment statements. Before becoming speaker, Quinn was a leading opponent of Bloomberg’s West Side stadium proposal, but in recent years she’s frequently taken industry-friendly positions, like opposing a property tax hike and supporting Vornado’s proposed 15 Penn Plaza over the objections of the local community board. Quinn also presided over the council’s approval of Bloomberg’s Willets Point redevelopment in exchange for more affordable housing — delivering a higher percentage of affordable units than initially planned, though far less than opponents sought.

Strasburg of the RSA, which lobbies against government regulation, nonethe-

less said that for candidates to be electable in the city, especially Democrats, supporting rent regulation is mandatory. “Anyone who doesn’t, it’s like touching the third rail of politics,” he said. Still, De Blasio has burnished his development credentials, in part, by supporting mega projects like Willets Point and Bruce Ratner’s Atlantic Yards in Brooklyn. He endorsed the use of eminent domain to secure land for both projects — at Atlantic Yards, he argued that the project’s potential to create jobs and affordable housing made it worthwhile.

REAL ESTATE & POLITICS Scott Stringer Current position: Manhattan Borough President (Democrat) Money raised: $2.21 million Real estate contributors: The Zeckendorfs, Durst and Fetner, Newmark’s Eric Gural, developers David and Jed Walentas, Taconic Investment Partners’ Charles Bendit and Paul Pariser. Background/positions: Like Quinn, Stringer has a job that gives him a key voice

John Liu Current position: NYC Comptroller (Democrat) Money raised: $2.02 million

in the approval process known as Uniform Land Use Review Procedure (ULURP) for major development projects. In that role, he’s supported expansions by Columbia and Fordham universities in exchange for restrictions on building size and public housing contributions. Also, in November he endorsed Rudin Management’s plan to redevelop the St. Vincent’s Hospital site, which the community board and many activists have op-

posed. In exchange, the developer agreed to concessions, including limiting the

project’s density. Stringer also supported the 15 Penn Plaza project and endorsed the original 1,250-foot height of the planned Jean Nouvel tower being developed by Hines next door to the Museum of Modern Art. The city later ordered the height to be reduced by 200 feet. The Stringer camp says it’s raised $3.2 million — but hasn’t yet rolled over more than $900,000 from an old campaign account.

Real estate contributor: Developer Sam Chang of the McSam Hotel Group. Background/positions: In 2009, Liu became the ﬁrst Asian-American to win citywide ofﬁce. But in November, his campaign was shaken by the arrest of a fundraiser, Xing Wu Pan, who was charged with conspiring to funnel an improperly large donation to Liu through straw donors. Before then, Liu had been aggressively taking on the powers that be. In 2010, he took on the city’s Economic

Development Corporation, charging that the organization failed to turn over $125 million to city government that it generated through real estate dealings. The EDC, which promotes development and manages city-owned properties, initially defended the practice, but later agreed to turn most of the money over to the city by 2014. Like his colleagues, Liu argued in favor of rent control laws as a council member. He was one of a handful — along with De Blasio — to vote against Two Trees Devel-

opment’s controversial Dock Street project in Dumbo. Opponents argued that it would block views of the nearby Brooklyn Bridge and urged politicians to defer to the local council member, David Yassky, who opposed the building. In his home district, Liu supported the $850 million redevelopment project Flushing Commons, though he withdrew his support after the project was approved and plans were changed to reduce its parking and community development facilities.

Bill Thompson Current position: Chief Administrative Ofﬁcer at Siebert Brandford Shank & Co., a municipal underwriting ﬁrm Money raised: $889,241 Real estate contributors: H.J. Kalikow & Co.’s Peter Kalikow, Rockrose Development’s Henry Elghanayan and the Continuum Company’s Ian Bruce Eichner. Background/positions: Thompson, who served as the city’s comptroller from 2002 to 2009, came surprisingly close to beating Mayor Bloomberg in 2009, taking 46

John Catsimatidis Current position: Owner, Red Apple Group (Republican) Money raised: No reported contributions Real estate contributors: Himself Background/positions: John Catsimatidis, chairman and CEO of the Red Apple Group, which owns Gristedes supermarkets as well as diverse holdings in oil, aviation and real estate, considered running for mayor in 2009 before dropping his bid. The withdrawal was at the behest, Catsimatidis said, of Bloomberg, who called him in for a meeting and asked for his sup-

percent of the vote — despite the fact that Bloomberg spent more than $100 million of his own fortune on the campaign. port. Now, Catsimatidis is pushing NYPD Commissioner Ray Kelly as a candidate — though he said some city Republicans are urging him to run, and he will consider it if Kelly stays out of the race. (Despite showing no signs of running, a recent Quinnipiac University poll shows Kelly leading all candidates with support from 24 percent of voters.) Catsimatidis — who debated developer Billy Macklowe at The Real Deal’s Lincoln Center forum in November — said that while he is not prepared to spend as much money as Bloomberg on a campaign, “I don’t have any problem spend-

Tom Allon Current position: Publisher and CEO, Manhattan Media (Democrat) Money raised: $99,079 Real estate contributors: David Picket of the Gotham Organization and developer Gregory Manocherian. Background/positions: Allon’s company publishes Our Town, West Side Spirit, Dan’s Papers and the political journals City Hall and the Capitol. A former highschool teacher and graduate of Colum-

bia University’s Graduate School of Journalism, he announced his candidacy in July and plans to run on the ticket of the Liberal Party. (The party was once in-

Thompson announced his 2013 candidacy shortly after that loss, but has been largely out of the public eye since. As comptroller, he endorsed both the Atlantic Yards and Willets Point projects, saying they would help stimulate the economy. He also used his powerful seat on the city’s Industrial Development Authority to take positions on many other proposals, including the new Yankee Stadium (he supported it, but later criticized it for receiving city tax breaks) and the expansion of the Brooklyn House of Deten-

tion (he opposed it). In 2009, he sided with opponents of the high-proﬁle Kingsbridge Armory redevelopment project in the Bronx, where Related Companies proposed a $310 million shopping mall. Activists had pushed to require a living wage and union representation there in exchange for approval. When Related balked at the agreement, the City Council voted the proposal down. Last month, Bloomberg announced a request for proposals to get the project back on the drawing board.

ing 10 or 15 or 20” million dollars. Catsimatidis’s local development projects include Ocean Dreams, a mixed-use project in Coney Island, with 400 condo units spread over three towers. In Downtown Brooklyn, he built the Andrea, a 95unit rental and the ﬁrst of several buildings on a 2.3-acre site. The developer is running in the same mold as Bloomberg — as a self-funded billionaire business executive. He told The Real Deal he would like to make the city more business-friendly, complaining that his company’s delivery trucks incur thousands of dollars in parking and trafﬁc tick-

ets near his warehouse in Hunts Point, and that regulations should be eased on large employers. Catsimatidis also said he’d encourage transit-oriented development by up-zoning areas near subway stations.

fluential — it supported the successful mayoral candidacies of John Lindsay and Rudolph Giuliani — but Allon is its first candidate for citywide or statewide office since 2005.) According to published reports, Allon hired powerhouse fund-raiser Cynthia Darrison, whose past candidates include Gov. Andrew Cuomo and former Gov. Eliot Spitzer. In the New York Times, Darrison described Allon, who has been a corporate client of hers, as a

pragmatic nonideologue. In public statements, Allon has supported congestion pricing, or charging drivers to bring their cars into Midtown. In an e-mail, he said the city’s property taxes and commercial real estate taxes had risen too much in recent years, and should be reduced. He also said the city should sell air rights above public school buildings to create new development sites in exchange for money from developers to repair the schools. TRD

www.TheRealDeal.com February 2012 29

The rise of Rapid Realty Firm’s assembly-line approach leads to speedy growth, but garners criticism BY KATHERINE CLARKE apid Realty’s Brooklyn headquarters was buzzing on a Thursday afternoon last month, as agents jostled for space at computers lining the exposed-brick wall. For an ofﬁce housing 30 agents, the sleekly designed space is tiny — only around 500 square feet. But that’s the point, explained Rapid founder Anthony Lolli; the young rental brokerage prides itself on being efﬁcient. The black-and-metal bar stools that serve

has done, he said it did 20 percent more transactions in 2011 than in 2010. Still, many industry insiders look askance at Rapid Realty, which operates primarily in the outer boroughs. That’s due in part to its franchise business model, which is unusual in the world of Manhattan residential real estate. But Rapid also has a somewhat unorthodox approach to renting apartments: Most notably, it uses an assembly-line system, which isolates certain tasks within each

or do you want to own a couple of Apple stores?”

Rapid growth Lolli had a modest upbringing in Brooklyn Heights and later in Park Slope. He’d worked as an agent for several different New York brokerages, including Fillmore Real Estate, when his mother — an Ecuadoran immigrant with whom Lolli is extremely close — recommended that he launch his own ﬁrm.

From left: Anthony Lolli, the founder and CEO of Rapid Realty; Brooklyn franchise owners Adrian Cardona and Gabriela Falquez; and Carlos Angelucci, COO of Rapid Realty.

“I was raised to never bite off more than I can chew, but [Rapid CEO Anthony Lolli] always says, ‘Just bite it, chew it and swallow it.’ ” Nina Rodriguez, Rapid Realty as the only seating, for example, are “not supposed to be comfortable,” he said, since agents are encouraged to be out doing deals rather than sitting in them. In August 2009, Rapid Realty cut the ribbon on its first franchise location in Crown Heights. Since then, the residential brokerage has amassed nearly 800 agents in 51 franchise locations throughout New York City, including seven in Manhattan. (The firm held 25 separate holiday parties this year to accommodate everyone.) Now the company is expanding outside the five boroughs: a Jersey City franchise opened last October, and Lolli said he is in talks with interested franchisees for offices in Washington, D.C., Chicago, Boston, San Francisco and even Brazil. Due to its recent growth, the aptly named firm is now one of the largest firms in the city in terms of number of agents, Lolli proudly told The Real Deal. Though he declined to give specific numbers regarding how much business the company 30 February 2012 www.TheRealDeal.com

rental transaction and assigns them to different brokers. One Manhattan brokerage head was skeptical that Rapid has as many agents as it claims. “I don’t see how it’s possible,” said the source, who asked to remain anonymous. “If they have this many people, how come we aren’t hearing anything about them?” But Lolli said the brokerage has intentionally stayed under-the-radar. “We preferred to take the approach of being quiet about our growth,” he said. “The goal was to open as many stores as possible and do so without publicizing it to the world and, more importantly, to the competition.” Lolli, who launched Rapid Realty in 1998 with a single Park Slope ofﬁce, presents himself as the ultimate entrepreneur and the poster child for franchising. “Franchising is a healthy way to grow your company,” he said. “You have to ask yourself, do you want to be Steve Jobs,

For the first few years, Lolli operated Rapid Realty out of an office at 681 Fourth Avenue in South Slope. At the same time, he built his own personal real estate portfolio, accumulating about 15 multifamily properties in the city, where Rapid Realty agents now handle the rentals. Then, after watching a friend’s trash removal business go franchise, Lolli grew intrigued. The idea really took root, he said, when he noticed that talented staff members he’d trained were moving on, often to start their own firms. “I knew that people don’t [just] want to [be managers],” he said. “They want to own their own offices.” In 2009, Lolli decided to open a pilot franchise in Crown Heights, installing one of his agents, Gabriela Falquez, as the manager. After six months, Falquez decided to become a franchisee, and opened her first office in Bay Ridge. (The Crown Heights office is no longer operating.) Most of Rapid’s franchisees are former

agents, Falquez said. Ten of her agents have now gone on to open their own franchises, either individually or in pairs. As part of his new franchise model, Lolli developed a system in which new Rapid agents are trained to focus on just one part of the rental process: showing apartments, creating listings or closing deals. This system aims to keep things simple for newbies and make the firm as efficient as possible, he said. Executing a rental transaction from start to finish “is a lot for agents to handle at the beginning of their careers,” said franchisee Adrian Cardona, who owns Rapid Realty locations in Bushwick, Williamsburg and Prospect Heights. “You have a higher probability of success if you divide it into parts.” As a result of this system, however, customers often work with two or more Rapid Realty agents during the apartment hunt, an approach that has drawn mixed reviews. This multi-agent approach isn’t “necessarily good for the customer,” said Kathy Braddock, cofounder of the Manhattan brokerage Rutenberg Realty and the website TopAgentGuide.com. “You have to look at your broker as you would a doctor. You should be in the hands of someone who can own the entire process.” When Rapid Realty first began franchising a wave of negative comments about the firm appeared on Yelp and other websites. “While everyone we dealt with here was friendly and generally helpful,” read one Yelp review, “this place really feels like an assembly line/boiler room/sweatshop.” “We were being attacked online,” Lolli recalled. He attributed some of those reviews to online defamation campaigns by local competitors, but he also recognized that the company had to make some changes to better serve its clients. Rapid issued a statement to apologize to those customers who had been treated poorly in the past, and since then, Lolli said he has “done a lot to increase customer care,” including providing incentives for agents who get the best online reviews. Criticism has also come from others in the industry, who grumble that the firm’s seeming tendency to “hire anyone” creates a “chaotic” environment, sources said. Lolli openly admits that Rapid Realty often hires bartenders and waitresses with no previous real estate experience. Nina Rodriguez, who now owns a Rapid Realty location in North Park Slope, had no real estate experience before becoming an agent with Rapid. “We try to introduce new people to the business,” he said, so they “don’t come over Continued on page 93 PHOTOGRAPH FOR THE REAL DEAL BY CHRIS MARTIN

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The Real Es

Samuel Irlander of Parker Madison Partners

Industry big-shots gather for By AdAm Pincus And Leigh KAmPing-cArder Hollywood is gearing up for the Academy Awards this month, but the New York City real estate industry has its own glamorous red-carpet event. Some 2,200 industry stars attended the Real Estate Board of New York’s 116th Annual Banquet at the New

TRD: What are people talking about? Prudential Douglas Elliman’s Faith Hope Consolo:

“Usually people will say, ‘I’m working on this and that.’ No one is saying that. This month has been very sideways.” Gala guests

Madison Realty Capital’s Michael Stoler (left) and Hal Fetner of Durst Fetner

TF Cornerstone’s K. Thomas Elghanayan (right)

Massey Knakal’s Paul Massey

TRD: How does the mood tonight compare to banquets in previous years? Glenn Rufrano, Cushman & Wakefield:

“Pretty good, considering the difficulties with the economy in the last year.”

Corcoran CEO Pamela Liebman

Durst Organization Chairman Douglas Durst

Kramer Levin’s Sandy Lindenbaum

William Cohen of Newmark Knight Frank

Bradley Mendelson, Cushman & Wakefield

TRD: Do you view this event as a networking opportunity, or a time to have fun?

Norman Sturner, Murray Hill Properties (left) and Colliers International’s Leon Manoff

Adam Leitman Bailey, Adam Leitman Bailey, P.C.:

“This is the only must-go-to event for anyone in real estate. It’s like the Knights of the Round Table, only there are 2,000 knights.”

Alan Perlmutter of GCP Capital Group (left) and Laurence Ross of Highcap Group Mayor Michael Bloomberg (left) and a banquet guest

TRD: What do you think about the protestors outside the hotel who say they oppose tax breaks for developers and landlords and want stronger rent regulation laws? Peter Riguardi, Jones Lang LaSalle:

From left: David Nevins of Cohen Brothers Realty Corp., Cushman & Wakefield’s John Picco and Roger Gulley

32 February 2012 www.TheRealDeal.com

“I respect everyone’s opinion. I just think there is probably a better way to convey the message than standing out in front [of the hotel].”

Shimon Shkury of Ariel Property Advisors (left) and Mark Tergesen of ABS Partners

tate Oscars

Gary Greenspan of Cushman & Wakefield (left) and James Emden of Colliers International

r the annual REBNY banquet

York Hilton last month. The crowd included real estate royalty like REBNY Chairman Mary Ann Tighe and developer Douglas Durst, along with politicos Mayor Michael Bloomberg, Attorney General Eric Schneiderman and City Council Speaker Christine Quinn.

Billy Macklowe of the William Macklowe Company CBRE’s Mary Ann Tighe

Holley Drakeford of Giscombe Realty Group

Randy Mallory of Global Homeland

From left: Studley’s William Montana, Simon Ziff of Ackman-Ziff Real Estate and Massey Knakal’s Bob Knakal

Brandl Frey of the Durst Organization (left) and Newmark Knight Frank President Jimmy Kuhn

TRD: What is the biggest issue you’d like to see REBNY tackle in the coming year? Bill Rudin (left) of Rudin Management, and his son Michael

Laurence Gluck, Stellar Management:

“Real estate taxes. That’s a big one.”

Joe Harbert, Cushman & Wakefield

Brian Ezratty (left) and Inbal Himelblau, both of Eastern Consolidated Daun Paris of Eastern Consolidated CBRE’s Mary Ann Tighe and Mayor Michael Bloomberg

TRD: Which designer are you wearing? Adelaide Polsinelli, Marcus & Millichap:

“Vera Wang. … The mood is festive, [hence] the feathers.”

Gil Robinov of Murray Hill Properties (left) and David Robinov

Avi Lebor (left) and Rosewood Realty Group’s Aaron Jungreis Howard Rubenstein, president of Rubenstein Associates

TRD: What is the most important real estate issue facing the City Council this year? Christine Quinn, City Council speaker: Brian Cooper (left) and Jarett Fein, both of Kensington Vanguard

David Levinson, CEO of L&L Holding Company

“How to get more buildings built.” www.TheRealDeal.com February 2012 33

Joining (and leaving) the club Behind record REBNY membership is a churn of real estate pros coming and going By Adam Pincus

embership at the industry’s leading trade group, the Real Estate Board of New York, is at an all-time high, but outside of public view there is a constant turnover of its ranks. This month, The Real Deal did a first-ever analysis of REBNY

membership, comparing the Class of 2012 to the Class of 2011 to see who joined — and who dropped out — this year. Using the trade group’s official handbooks from both years, TRD reviewed the membership status of individuals representing approximately 1,580 companies. (Individ-

Ariel Property Advisors Former Massey Knakal Realty Services partner Shimon Shkury, pictured, formed the commercial brokerage in January 2011. The firm focuses on multifamily sales in Northern Manhattan and the Bronx.

uals, not companies, make up the membership.) The analysis found that real estate pros representing nearly 200 firms — the vast majority of them small ones — dropped their membership, and conversely individuals representing about 150 firms joined last year.

more public role in NYC since several of its securitized loans went into default, including $3 billion of debt on Stuyvesant Town and Peter Cooper Village.

its first NYC office in February 2011, and now has four brokers and agents, the DOS database showed.

Kian Realty

Walker & Dunlop

The Midtown-based, 100 percent-commissionmodel residential firm that Charles Doolan founded in June 2011 now has 49 agents and brokers, DOS figures show.

The Bethesda, Md.-based real estate finance firm opened its NYC office, headed by Drew Anderman, in February 2011. “We joined because REBNY is an important organization for our business in New York City,” Anderman said.

Avison Young The fast-growing Canadian-based commercial service firm opened its first NYC office in August. Principal Gregory Kraut, a former agent with CBRE, is the sole broker locally, DOS records show.

Brookfield Financial Real Estate This division of Brookfield Asset Management (see story on page 56) expanded its NYC office last year with the hiring of brokers Eric Anton and Ronald Solarz.

Savanna The fast-growing real estate private equity firm Savanna, founded in 1992, is led by Christopher Schlank, left, and Nicholas Bienstock. The firm acquired eight Manhattan office buildings for a total of $747 million over the past two years.

CWCapital LLC The lender and loan-servicing firm is part of the larger CW Financial Services, which has taken a

REBNY officials declined to verify the numbers, but said the group had a record 12,542 members at the end of 2011 — 465 more than in December 2010.  Below are some highlights of companies that are no longer represented in REBNY, and companies that have just signed on.

Transwestern The national, privately held commercial firm opened

Toll Brothers The 44-year-old national homebuilder based in Pennsylvania has greatly increased its stake in Manhattan by purchasing three sites for $196 million over the past 14 months, RCA data show. Pictured at right: the firm’s David Von Speckelsen.

Joined Dropped Archdiocese of New York The Roman Catholic Archdiocese of New York reportedly sold approximately $100 million worth of real estate during the boom years as parishes contracted, but that selling activity has slowed in recent years. Pictured: Archbishop Timothy Dolan.

Archstone One of the nation’s largest multifamily property owners, Archstone owns and manages 10 rental apartment buildings in Manhattan and one in Brooklyn, among the 434 properties it owns throughout the U.S. and Europe.

doing more work outside of NYC now, and so decided to let his membership lapse. While he said REBNY was an effective advocate locally, “once you’ve moved off Manhattan island, their influence just isn’t there.”

Alice F. Mason Ltd. Clarett Group The development firm, which built such projects as the Costas Kondylis tower at 200 West End Avenue at 70th Street, closed its doors in March last year. Pictured: Veronica Hackett, the former managing partner at Clarett.

34 February 2012 www.TheRealDeal.com

Alice Mason, pictured, the legendary 79-year-old residential broker and dinner party host, is also no longer listed as a REBNY member. In 2008 she closed her Madison Avenue office, and in 2010, she told The Real Deal she was scaling back her business.

Hyline Safety Company The owner of the Midtown-based safety consultant firm, Evan Lipstein, said that despite a good relationship with REBNY, it did not currently provide enough benefit for the cost of membership.

Great American Brokerage Paul Fetscher, the president of the two-person, Long Island–based commercial firm, said he was

real estate attorney Michele Peters. She confirmed letting the company’s membership lapse, but declined to comment on why she didn’t renew.

Peters Realty Group: The Manhattan-based boutique firm is headed by

The Salvation Army The nonprofit organization and landlord sold two valuable Manhattan buildings in 2010, including the 17-story former hotel at 18 Gramercy Park South for $60 million.

200 FIFTH AVENUE Bank of China JP Morgan Asset Management Silverpeak Real Estate Partners

$721,000,000 September 2011

Owner/Manager

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Home-ownership costs to skyrocket with new fees, loss of write-offs BY KENNETH HARNEY hough its demise drew little attention because of the partisan year-end brawl over the payroll tax cut extension in Congress, a key mortgage ﬁnancing beneﬁt disappeared at the end of December: the ability of large numbers of homebuyers and owners to write off the premiums they pay for mortgage insurance. The loss of that tax deduction — plus mandatory new fees imposed by Congress on all new conventional and Federal Housing Administration loans — could effectively ratchet up the costs of home-ownership this year. The expiration of mortgage insurance deductibility will hit many low-down payment conventional loans originated since 2007,

retroactively this year, but the current poisonous political atmosphere on Capitol Hill raises doubts about the timing of that scenario. The mortgage insurance premium deduction dates to legislation enacted in 2006. It allows purchasers and refinancers who use either private mortgage insurance or federal insurance or guarantees, and who itemize on their federal tax returns, to write off their premiums. Borrowers who are single or married and filing jointly with adjusted gross incomes of $100,000 or less can write off 100 percent of their annual mortgage insurance premiums. Married homeowners filing singly can write off 50 percent of premiums. Borrowers with incomes above $100,000 may qual-

cut, negotiators tacked an unusual provision that raises fees on the majority of conventional mortgages — those originated for sale to or guaranteed by Fannie Mae and Freddie Mac. Starting in April, Fannie and Freddie will impose a surtax on the guarantee fees they charge private lenders equal to one-tenth of 1 percent. Lenders are virtually certain to pass those fees to consumers in the form of a higher note rate or loan charges up front. Industry estimates suggest the surtax could add an eighth of a percentage point to rates and raise costs to borrowers over the life of the loan by more than $4,000 on a $200,000 mortgage. Unlike standard guarantee fees, which are used by Fannie and Freddie to defray loan-default expenses, the new funds will be sent

The loss of the tax deduction — plus mandatory new fees imposed by Congress on all new conventional and FHA loans — could effectively ratchet up the costs of home-ownership this year. plus virtually all new mortgages closed this year where the down payment is less than 20 percent. Though industry experts do not have precise numbers, their estimates range into the millions of existing owners and new purchasers potentially touched by the deductibility termination. Borrowers using guaranteed veterans and rural housing loans, where down payments can drop to zero, also are affected. The change in the law took effect last month, along with the expiration of 58 other tax code benefits that Congress failed to renew, such as credits for home energy improvements, credits for builders of energy-efficient new houses and deductions for state and local sales tax payments. They were all components of what would have been an annual “tax extenders” bill authorizing continuation of relatively noncontroversial expiring benefits for another year or more. Congress could still reauthorize all or some of the write-offs

ify for partial deductions on a sliding scale. In many cases, the post-tax savings for these borrowers are signiﬁcant. New buyers with an income around $100,000 and a mortgage of $200,000 would save between $600 and $1,000 a year, depending on their credit score and loan-to-value ratio, according to MGIC, one of the largest private mortgage insurers in the country. For households with lower incomes, the impact would be less, depending on their marginal federal tax brackets. David Stevens, who served as FHA commissioner and is now CEO of the Mortgage Bankers Association, said the loss of deductibility of mortgage insurance “hits a segment [of consumers] — middle-income and ﬁrst-time buyers — where affordability is especially important.” But mortgage insurance was not the only housing-related casualty of the pre-Christmas skirmishing. As part of the temporary extension of the payroll tax

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directly to the Treasury to help pay for the $36 billion cost of the temporary payroll tax cut. FHA loans also will be hit with a fee increase by the payroll bill, raising the annual premiums it charges new borrowers by one-tenth of a point. At a time when the Federal Reserve is warning that there can be no broad economic improvement until housing recovers, it may strike you as odd public policy to raise costs for homebuyers and reﬁnancers in order to fund unrelated, temporary tax relief. But that’s not the way they saw it on Capitol Hill in the rush to holiday recess. Bottom line: The mortgage insurance deductibility problem may disappear if mortgage insurance gets included in an electionyear extender package. But the fee hikes on most new mortgages are here for the foreseeable future, so buyers should factor them into their housing budgets. Kenneth Harney is a syndicated real estate columnist.

Facebook:

www.facebook.com / TheRealDealMagazine 36 February 2012 www.TheRealDeal.com

Government I N B R I Ebriefs F Cuomo plans nation’s biggest convention center in Queens Gov. Andrew Cuomo last month unveiled plans to bring a massive convention center to the newly opened Aqueduct Racetrack complex in Queens. The state is working with developer Genting Group, which curThe proposed convention center in Queens rently runs Aqueduct’s racino, on the proposed $4 billion, 3.8 million-square-foot project. With 3,000 hotel rooms, the facility would be the country’s largest convention center. The ﬁrst phase of the project is expected to be completed by 2014, according to the Wall Street Journal, though Genting has yet to sign an agreement to begin construction. The new facility would replace Manhattan’s Javits Center, which Cuomo described as “obsolete,” the Journal said.

Fed calls for action on housing market The U.S. Federal Reserve last month called for action to stabilize the nation’s housing market, warning that failure to do so could harm the broader economy. In a 26-page white paper sent to Congress, the Fed outlined several ways to shore up the housing market. “Restoring the health of the housing market is a necessary part of a broader strategy for economic recovery,” Federal Reserve chairman Ben Bernanke said Ben Bernanke in a letter to lawmakers. While there is “no single solution” for the nation’s housing problems, the paper said, “it might be appropriate in some cases to redeploy foreclosed homes as rental properties.” And when it comes to Fannie Mae and Freddie Mac, further short-term losses for the mortgage giants “might be in the interest of taxpayers.” If no action is taken and the economy worsens, the Fed may take the controversial step of buying more mortgagebacked securities.

Upgrades in the works for LaGuardia The Port Authority last month issued a request for proposals to replace the cramped, aging Central Terminal Building at LaGuardia International Airport, the Wall Street Journal reported. Construction on the $3.6 billion project is slated to be completed by 2021. Nearly half of the airport’s 24 million annual passengers use the Central Terminal, which was built in 1964. “I don’t think anybody feels it’s a 21st-century facility,” Port Authority executive director Patrick Foye told the Journal. “It’s inadequate from the point of view of passengers, airlines and the Port Authority.” The Port Authority is also expected to announce a similar request for proposals to overhaul Newark Liberty International Airport’s Terminal A.

9/11 museum falls behind schedule The National September 11 Memorial & Museum in Lower Manhattan now has “no chance” of opening in time for the 11th anniversary of the terrorist attacks next fall, Mayor Michael Bloomberg said at a press conference late last year. “Work has basically stopped,” the Mayor said, and the project may not be complete until the second quarter of 2013, according to the Downtown Express. Plans have stalled because of a payment dispute between the Port Authority and the September 11 Memorial The September 11 museum Foundation, which is chaired by Bloomberg. The Port Authority claims the foundation owes it $300 million for construction costs, while the foundation asserts that the Port Authority owes it around $146 million due to delays. When the facility ﬁnally opens, most of the 11,000-square-foot museum will be located underground, in the foundations of the original World Trade Center towers. Compiled by Russell Steinberg

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Cutting incentives in half

In a sign of the rental market’s strength, partial-month incentives replace OPs BY YASMEEN QURESHI uring the worst depths of the real estate downturn, many Manhattan landlords paid brokers’ fees — usually the equivalent of a month’s rent — rather than asking tenants to pay them. That way, owners could quickly ﬁll vacant units by advertising “No Fee” apartments. But now that practice — known as an OP for “owner paid” — is being replaced. Instead, landlords are paying brokers a commission equal to only half a month’s rent, in a sign of the rental market’s recent strength, brokers said. “At the end of 2010, I saw full OPs,” said Douglas Wagner, executive director of leasing at the brokerage Bond New York. This December, by contrast, “I saw half-month OPs,” he said. These partial-month commissions differ from the traditional OP in several key ways. A full OP is intended to replace the brokers’ fee normally paid by the tenant, but a half-month incentive is more “like a little bonus” for the broker, Wagner explained. If the landlord is offering a halfmonth incentive, the broker can choose to keep the extra cash for himself, in addition to collecting the usual fee — usually 15 percent — from the renters. Or he can pass the savings on to the clients and dis-

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Landlords ... believe homeseekers willing to pay a brokers’ fee are more serious renters who are likely to stay in the unit for a longer period of time. count their fee. That way, he still receives the full 15 percent commission, but the tenants only pay around half of it. Either way, renters still pay something, so the apartment can’t be listed as “No Fee.” Landlords actually view that as a good thing, Wagner said, because they believe homeseekers willing to pay a brokers’ fee are more serious renters who are likely to stay in the unit for a longer period of time. Brokers, however, aren’t always pleased.

Cheaper for landlords

(212) - 731 - 9236 38 February 2012 www.TheRealDeal.com

commissions on some of its units. Hedaya said he occasionally sees partialmonth OPs in the Financial District, where a plethora of large rental buildings need to keep their apartments full. Half-month commissions are obviously cheaper for landlords than full OPs, but still provide extra motivation for agents to bring clients to their listings, explained Zach Levine, director of leasing at Icon Realty Management, which owns and manages more than 1,000 New York City apartments. “It just gets brokers showing your apartments,” Levine said, noting that Icon Realty Management is not currently offering half-month OPs on any of its listings, but has done so at times over the past several years. In recent months, he said, Icon has been able to move the apartments on its roster without offering incentives. Wagner also noted that many partial OPs offered at the end of 2011 have already disappeared as

Wagner said these half-month commissions appeared en masse in December, when he noticed that they were being offered at around 35 buildings in Manhattan — mostly small elevator buildings, and some larger walk-ups. Winter is traditionally the quietest rental season of the year, and the holidays are especially slow, he said, so buildings wanted to offer brokers “a little extra” to entice them to show units. One of those buildings was 95 Wall Street in the Financial District, according to Platinum Properties executive vice president Daniel Hedaya, who said the 507unit luxury rental offered to pay half-month

the rental market picked up steam after the holidays, and they are likely to grow even less common as the market moves into its strong spring and summer seasons. He said the number of new clients registering with his ﬁrm is up 34 percent from this time last year. So far, the half-month OP has not popped up in new construction rental buildings, which continue to rely on full OPs, said Cliff Finn, president of new development marketing at Citi Habitats. The main priority for a new building is ﬁlling vacant apartments as soon as possible, Finn said, so half-month commissions are less effective at moving units than full OPs. But since the forecast for the rental market in 2012 is positive, he said, “it wouldn’t surprise me if we started to see it.”

Cash for clients Hedaya said when his agents are offered a half-month commission, they always subtract that amount from the renter’s 15 percent brokers’ fee. Not only is it “the correct thing to do,” he said, it’s a good Continued on page 92

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PROFILE

Astor Master

With a mega- construction loan in hand, developer Edward Minskoff is betting the bank on his speculative Astor Place office tower BY ADAM PIORE n New York City, possibly the only thing rarer than a developer who can get a $100 million-plus construction loan these days is a developer who can get one to build a speculative office tower. Recently, Edward Minskoff surmounted both hurdles, winning approval for a $165 million loan to build a flashy, 400,000-square-foot, 13-story office tower in the heart of Astor Place, an area one doesn’t normally associate with new office space. Minskoff will be looking for rents in the high $80s to $100 a square foot for the top floors, according to Paul Glickman, vice chairman of Jones Lang LaSalle, which will serve as the commercial broker for the building. Those are numbers that have raised some eyebrows. To get those rents, said Richard Bernstein, vice chairman of Cassidy Turley, the market will need to climb another 10 to 15 percent. “The fact that the building is not online today is a good thing,” he said. “Once we get beyond the election, I think the market is poised for another spurt in prices. But we would have to see some absorption to take away some of the supply.” Minskoff — who is in his early 70s, wears his white hair slicked back Gordon Gekko–style and favors well-tailored business suits with colorful suspenders — has a long history of anticipating market trends. Even so, his plans are ambitious. Minskoff could name just one other completely speculative office tower that has been constructed in New York City in the last 20 years. And its fortunes so far aren’t especially encouraging. More than a year after SJP Properties officially opened 11 Times Square, the 40-story, 1.1 million-square-foot tower remains 62 percent vacant, according to data from the CoStar Group. Recently, the developer replaced leasing agent CBRE Group with JLL. It also filed plans to convert some of the office space to commercial condos. If demand for his office space falls short, Minskoff ’s options will be limited. He purchased the lot from Cooper Union, knowing that the zoning allows only commercial or retail on the site. Nevertheless, Minskoff, who sat down for an interview with The Real Deal last month, said the sale immediately struck him as “a great opportunity.” In addition

40 February 2012 www.TheRealDeal.com

to easy access to mass transit, the area is “a very, very attractive neighborhood for people to work in” — especially young, creative types in competitive industries, he said.

A personal bet The 51 Astor Place site sits on an island at the top of Astor Place, bounded on all four

honed over decades building an art collection that includes masterpieces from the likes of Pablo Picasso, Roy Lichtenstein, Jasper Johns, Jackson Pollock, Damien Hirst, Takashi Murakami, Andy Warhol, Willem de Kooning and Jean-Michel Basquiat. So it’s not surprising that he hired the Pritzker Prize–winning architect Fumihiko

Edward Minskoff said he doesn’t think “others in our industry so easily could get a construction loan for a 100 percent vacant ofﬁce building.”

“It’s one of the smallest buildings I have developed in the last 25 years. But I think it’s the coolest. It’s not just another tall box. It will have an identity. It’s going to be very, very, very visible.” Edward Minskoff, Edward J. Minskoff Equities sides by streets — Third Avenue, Fourth Avenue, 9th Street and Astor Place — providing the space needed to create an architecturally unique structure. Minskoff takes pride in a discerning eye,

Maki to design 51 Astor Place. The design is a distinctive Neo-Modernist ediﬁce with three parts, consisting of a low-lying glazed box, upon which he will stack glass and dark granite geometric shapes. It’s a bold design

that promises to transform the feel of Astor Place. Minskoff is banking that the cachet will draw the big-money tenants he’ll need to make the project work financially. So far, the JLL team handling the leasing — which, in addition to Glickman, includes Peter Riguardi, president of the company’s New York region; Mitchell Konsker, vice chairman; and Cynthia Wasserberger, managing director — has seen “significant interest” from technology, finance and publishing companies, Minskoff said. “We’re in conversations with a number of different tenants [and are] already trading paper,” Glickman said. “We have proposals [and] counter proposals.” Minskoff said the building, which is scheduled to be ready for tenant construction at the end of 2012 and open for business in the spring of 2013, is “one of the smallest buildings I have developed in the last 25 years.” “But I think it’s the coolest,” he said. “It’s not just another tall box. It will have an identity. It’s going to be very, very, very visible. It’s going to be an iconic building.” And he’s betting his own money on that prospect. He estimated the total development cost to be north of $300 million, backed with a $165 million construction loan from a Bank of America–led consortium of lenders that also included TD Bank, PNC and U.S. Bank. The rest of the equity comes from Minskoff himself and his partner Rockwood Capital. (Minskoff declined to say how much he personally contributed to the deal.) “I don’t think that others in our industry so easily could get a construction loan for a 100 percent vacant office building,” he said. “But I never doubted for a minute that we would be successful in getting the construction financing we needed for this property. I have developed more than 37 million square feet of office space around the United States, and I have never given back a building — ever.” Mike Kaufman, who as a partner at the Kaufman Organization has brokered deals for a wide array of tech companies, including Apple and Infosystems, noted that the building is surrounded by tech tenants, as well as big-name fashion houses.

PROFILE Just a block away is 770 Broadway, the 15-story former home of the Wanamaker Department store, where AOL relocated its corporate headquarters in 2008, joining Viacom International, J. Crew and the publisher VNU. A number of tech companies have space to the south on Lafayette Street. And slightly to the north, Apple, discount-deal website Living Social and Yelp all have signiﬁcant space. “I agree with the location,” Kaufman said. “This will attract creative types.” However, in order to get high rents, he said, “they will need a certain corporate type. Obviously an entrepreneurial startup is not going to go there.”

skoff said he helped raise billions of dollars and made contacts throughout the financial world. Upon leaving the company in 1976, he set up his own real estate firm, specializing in property ownership, consulting and debt financing, and began working with Paul Reichmann, the scion of a Toronto-based real estate family that owned a billion-dollar Canadian developer called Olympia & York. Reichmann, who did not own any properties in New York, had agreed to buy a 48-story tower that four banks had foreclosed on with Minskoff serving as both the broker and an investor at 1633 Broadway, near Times Square. But when that deal fell

Career changer The grandson of the legendary New York City developer, Sam Minskoff, Edward Minskoff arrived in New York City in the late 1960s with nothing but a beat-up used car and a few hundred dollars to his name. His uncles and cousins who controlled the family real estate empire did not get along with his side of the family, and he has long insisted that he “never took a penny from my family.” “It happens sometimes that you have families that are cohesive, and sometimes families that are dysfunctional,” he said. “Unfortunately, I was on the wrong side of that.” But his connections still helped. After growing up in Washington, D.C., and Southern California, Minskoff attended Michigan State University, then studied ﬁnance at UCLA Business School, during which time he helped manage the construction of two apartment buildings being developed by his father. When he arrived in New York in 1967, he took a job as a broker at Cushman & Wakeﬁeld to “learn leasing.” During that time, he claims, he brokered the largest commercial lease done up to that point. The deal, he said, was structured to allow his uncles, who controlled the family empire, to acquire the variety store W.T. Grant’s headquarters at 1441 Broadway, so that W.T. Grant could then move and lease roughly 500,000 square feet of space in another building owned by his uncles at 1515 Broadway. After roughly two years, Minskoff left Cushman and moved to Lehman Brothers, where he worked as a senior vice president specializing in real estate. At the time, many big U.S. retailers owned thousands of properties nationwide and were coming to believe that getting them off their balance sheets and raising the cash would be better for business. Minskoff helped structure deals to sell the properties as securities to investors, and rented the properties back to the retailers under long-term 30-year leases. During his six years at Lehman, Min-

1301 Sixth Avenue. Tapping his connections, Minskoff was able to get a meeting with Ross. At the time, Ross had already entered into protracted negotiations with developer Sam LeFrak, but had been unable to reach an agreement. “There were a lot of people in my industry that were circling the package of properties, but most of them wanted to do complicated, structured deals,” Minskoff said. “I met with Steve Ross, and I asked him how he wanted to get it done.” “‘I don’t want to take back paper,’” Minskoff recalled Ross telling him. “‘And I don’t want to sell one building at a time. I want to sell the whole package.’”

in upgrades. Plus, many of the buildings were saddled with leases that included caps on rent escalation. Even so, Minskoff estimated that the rents, which averaged about $10 a square foot, would average about $18 a square foot within 18 to 24 months. He was wrong, very wrong. Instead, over a three-year period, rents rose to the mid-$30s. The value of the buildings appreciated over seven years, he estimates, from about $334 million to about $3.5 billion. It was a career-making deal. Soon, Minskoff was working for Olympia & York, overseeing most of the company’s North American operations. His contract

A rendering of 51 Astor Place, where rents will be in the high $80s to $100 a square foot.

Architect Fumihiko Maki, who designed 51 Astor.

Paul Glickman of Jones Lang LaSalle, which is leasing 51 Astor.

through, Minskoff came up with a better idea. In 1973, two moguls, Harold and Percy Uris, had sold a package of nine buildings to a company controlled by Warner Communications. And around the time the 1633 Broadway deal fell through, Warner CEO Steven Ross announced that he had decided to liquidate the Uris holdings — which were 55 Water Street, 2 Broadway, 60 Broad Street, 245 and 320 Park Avenue, 850 Third Avenue, 10 East 53rd Street, and 1290 and

PHOTOGRAPH OF 101 SIXTH AVENUE FROM PROPERTYSHARK.COM

101 Sixth Avenue, where Minskoff just bought out partner the Andalex Group.

So Minskoff called Reichmann. And within 10 days, Minskoff claims, he was able to broker an all-cash deal. In the depressed New York market of the mid-1970s, Olympia & York ended up acquiring eight prime buildings, totaling 11 million square feet. Overall, the cost was about $56 million, plus the assumption of about $288 million in debt. To some it seemed risky. New York was in danger of falling into bankruptcy, and the properties needed tens of millions of dollars

Condo tower 101 Warren Street, which sold out a few years ago.

included the opportunity to purchase a $10 million equity stake in the company, bankrolled with a loan from the Reichmanns, according to the 1997 book “The Reichmanns,” by former Businessweek reporter Anthony Bianco. “There are certain talents which are in the creative ﬁeld — development of new ideas, new concepts,” Reichmann once said. “Mr. Minskoff had these particular talents. ... As an executive he was wanted Continued on page 90

www.TheRealDeal.com February 2012 41

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HIGH-END BROKERS

THE LUXURYLIST A neighborhood-by-neighborhood ranking of Manhattan resale brokers on $5 million-plus deals

BY LEIGH KAMPING-CARDER

Since the identity of buyers’ brokers is not pub-

t’s always been difﬁcult to rank the

licly available, the rankings include only listing

city’s top real estate agents, given the

brokers. The ranking also does not factor in spon-

lack of publicly available information

sor sales at new developments, since it’s difﬁcult

about their performance — at least

to compare the process of selling condominium

when measured by cold, hard data.

units for a developer to working with individual

But for the ﬁrst time ever this month, The

homeowners.

Real Deal compiled a ranking of luxury sell-

For most of the luxury brokers on the list,

ers’ agents based on the dollar volume of their

the key to dominating in a particular neigh-

closed sales, rather than listings. And we’ve

borhood was securing one mammoth sale. But

drilled down even farther, discovering who

a select few — Serena Boardman of Sotheby’s,

reigns supreme in different corners of Man-

John Burger of Brown Harris Stevens and Rob-

hattan.

by Browne of Corcoran, for example — seem to

We looked at sales of $5 million and up, be-

have cornered both the volume business and

low 96th Street, which were closed and record-

the megadeals.

ed in 2011. Then we used the new “Shop for a

These three brokers are household names in

Broker” tool from listings aggregator Street

the residential real estate world, but they’re not

Easy to match up the transactions with the

the only ones. However, some familiar names

seller’s agents. Lastly, we did our own research

are absent from this list, partly because we’re

to help ensure we weren’t missing any transactions, ultimately matching nearly 90 percent of sales. (A portion of the remaining sales were offmarket deals that never ofﬁcially had listings.)

From left: Prudential Douglas Elliman’s Hervé Senequier and Leonard Steinberg, the top luxury brokers in Chelsea,

and partly because some brokers had deals spread

and Brown Harris Stevens’s Kathy Sloane, who made the list on

across Manhattan, and didn’t dominate in a specific

both the Upper East Side and Midtown East.

Upper East Side

ore than any other Manhattan neighborhood, the Upper East Side is home to soaring deals. As a result, the competition for the top broker spot is at its fiercest. High-society broker Serena Boardman, who ranked as the neighborhood’s top luxury broker, closed over $45 million in deals in 2011 — the most expensive being a $12.5 million townhouse at 13 East 94th Street. The home — sprawling over 15 rooms and five stories — was owned by Maren Properties LLC, an entity that has been linked to Mark and Renee Rockefeller, fourth-generation members of the prominent family. Boardman is no stranger to clients with names ripped from the society pages. She also helped Eli Broad, the billionaire philanthropist and art collector, sell a full-floor co-op on the top floor of the Sherry-Netherland hotel on Fifth Avenue for $8 million. Boardman rarely, if ever, speaks with the press, and it seems that many of her deals also take place out of the public eye. Take, for From top: Serena Boardman and Robert Schulman. example, the $36 million sale of Limited Brands founder Leslie Wexner’s co-op at 834 Fifth Avenue — one of the priciest to close in 2011 —where Boardman reportedly made hush-hush calls to other brokers to secure the buyer, real estate developer Larry Heyman of Heyman Properties. (The deal was not included in her total because there was never

INTRO PHOTOGRAPH FOR THE REAL DEAL BY MARC SCRIVO

looking at a snapshot of closed deals from 2011,

neighborhood.

Top Upper East Side luxury resale brokers, 2011 NAME

FIRM

SALES

DOLLAR VOLUME

Serena Boardman

Sotheby’s Int’l Realty

$45.43 million

Robert Schulman

Warburg Realty

$44 million

Kathy Sloane

Brown Harris Stevens

$36 million

Source note: All of the rankings in this spread include deals $5 million and over that were closed and recorded by the city in 2011, where The Real Deal and/or StreetEasy were able to match the transaction with a sales agent listing. It does not include off-market deals, sponsor sales or agents who represented buyers.

an ofﬁcial listing.) Robert Schulman, an executive managing director at Warburg, ranked second with two Park Avenue co-op sales totaling $44 million last year. First, he represented Irving and Judith Shafran, a matrimonial lawyer and book editor, respectively, in selling their 18th-ﬂoor, four-bedroom home at 778 Park. The Shafrans originally listed the apartment in December 2009, mere days before Bernard Madoff was arrested for running an epic Ponzi scheme in which the couple had invested, according to court documents. The property was on the market until this past November, when it was sold to Zygmunt Wilf, a real estate developer and owner of the Minnesota Vikings. The Sherry-Netherland

www.TheRealDeal.com February 2012 43

HIGH-END BROKERS Wilf faced criticism for paying $19 million for the residence while simultaneously seeking municipal tax breaks for a new football stadium in Minneapolis. Schulman also helped David Matlin, an investor known for his interest in distressed assets, and Lisa Matlin, who runs a 13 East 94th Street Carnegie Hill gift shop, sell a sizeable spread at 625 Park Avenue. The 7,500-square-foot home was made up of two units — one “completely renovated to the highest standards and speciﬁcations” and another that “awaits your personal touch.” David Simon, the CEO of Indianapolis-based mall giant Simon Property Group, bought the whole shebang for $25 million. Kathy Sloane — who took third place on the ranking with two deals worth a combined $36 million — has also worked with a cadre of business bigwigs. A senior vice president at Brown Harris Stevens, she handled the sale of a third-ﬂoor co-op at 640 Park Avenue for Peter Smith, a retired Lazard Frères executive, and his wife,

Marie. The four-bedroom, six-bathroom residence fetched $20.5 million and went to hotel scion Alexander Tisch. Sloane worked with another ﬁnancier on the sale of a full-ﬂoor unit at the Carlyle Hotel at 35 East 76th Street. Peter Schoenfeld, the head of P. Schoenfeld Asset Management, and his wife, Charlotte, sold the home for $15.5 million to Brad Grey, the chairman and CEO of Paramount Pictures. By our count, almost 100 agents listed and sold properties of $5 million or more on the Upper East Side last year. That means that some notable top producers are absent from our ranking. Corcoran’s Carrie Chiang, for example, sold nearly $58 million of residential real estate in the neighborhood, but many of her deals didn’t make the $5 million cutoff. Brown Harris Stevens’s John Burger sold William Lie Zeckendorf ’s co-op at 927 Fifth Avenue for $34.6 million, but that wasn’t quite enough to make the top three — at least on the eastern side of Central Park. And, one of the most talked-about deals of the year — Johnson & Johnson heiress Libet Johnson’s $48 million sale of the Vanderbilt Mansion at 16 East 69th Street to Beauty .com founder Roger Barnett — was an off-market deal between friends. Similarly, it’s unclear whether brokers were involved in J. Christopher Flowers’s $36 million mid-renovation sale of the Harkness Mansion to art mogul Larry Gagosian, and there was never a public listing.

Upper West Side

op Brown Harris Stevens broker and senior vice president John Burger dominated sales on Central Park West in 2011 with a stunning $54.1 million in closed deals. That includes three $5 million-plus deals at the Eldorado, the co-op where Burger said he has brokered the majority of the trades for the last 20 years. Burger’s clients in the building last year included Thomas Tierney, a director of eBay and former CEO of Bain & Co., an affiliate of GOP presidential hopeful Mitt Romney’s former employer Bain Capital. Tierney sold a 19th-floor penthouse for $6.25 million. Burger later helped him into another one of his Eldorado listings — a larger unit that Silicon Valley entrepreneur Richard Yanowitch sold for $8.95 million. Burger, who moonlights as the broker specialist at the Dakota at 1 West 72nd Street, also handled a $14.5 million sale at the San Remo at 145 Central Park West — his priciest in the neighborhood — and a $10.25 million sale at the Park Millennium on West 67th Street. He said he had a record year in 2011. “A lot of that comes from hard work, understanding of the marketplace and a strong pipeline of satisfied clients over a quarter-century,” he told The Real Deal. Elliman’s Raphael De Niro sold two pricey properties in the Time Warner Center at 59th Street last year for a combined $48.05 million, easily catapulting him onto the Upper West Side ranking. The smaller of the two was a $17.5 million condo atop the Mandarin Oriental hotel owned by a trust reportedly backed by football star Tom Brady (whose

Top Upper West Side luxury resale brokers, 2011 NAME

FIRM

SALES

DOLLAR VOLUME

John Burger

Brown Harris Stevens

$54.07 million

Raphael De Niro

Prudential Douglas Elliman 2

$48.05 million

Cathy Taub

Stribling & Associates

$31.25 million

Source: See source note on page 43.

The Eldorado

44 February 2012 www.TheRealDeal.com

agents signed the deed). But De Niro’s biggest sale was the penthouse two floors up, No. 76B, owned by Todd Wagner, cofounder of website Broadcast.com, which sold for nearly $30.6 million. The buyer was reportedly Taek Jho Low, a Malaysian financier. The $6,331-per-square-foot deal broke priceper-square-foot records in the building, De Niro said. (It also outranked other powerbrokers who handle listings there, including the Sotheby’s duo Elizabeth Sample and Brenda Powers.) Still, De Niro doesn’t consider himself a neighborhood specialist. “Modern-day brokers are not constrained by specific geographies,” he said. “That’s the old way of doing it.”

From top: Cathy Taub, John Burger and Raphael De Niro.

Moving down the rankings, among Cathy Taub’s four $5 million-plus sales were two idiosyncratic deals, one at the Eldorado and another at the Majestic at 115 Central Park West, where she’s lived since 1994. Taub and her Stribling colleague Rosette Arons listed an eighth-ﬂoor unit there for CBS medical correspondent Emily Senay and Avery Seavey, head of Manhattan-based real estate developer the Seavey Organization. An investment banking executive and his wife paid $5.7 million for the three-bedroom in January 2011, but before they moved in, the couple “had a change of heart and bought something completely different,” Taub said. They promptly drafted Taub and Arons to relist the apartment. Taub then found a buyer, a Bank of America investment banker, who knew exactly what he was willing to pay: $5.7 million. “Talk about having an immediate comp,” Taub said. “It was easy to justify the price.” At the Eldorado, Taub and Elliman’s Oren Alexander sold two adjacent units owned by separate sellers to a single buyer. Initially, the two brokers listed the apartments separately, with Taub marketing unit 7G for the estate of Gregoire C. R. B. MacArthur, a member of the family whose eponymous foundation awards so-called genius grants. Alexander had the listing for unit 7F, owned by architect Bernard Marson, a 30-year resident of the Eldorado. But they wagered that a potential combination would reel in a better deal.

Time Warner Center

Richard Barasch, the head of Universal American Corp., a health beneﬁts administrator based in Rye Brook, N.Y., nabbed both for about $13.25 million. Also worth noting is Upper West Side powerhouse Lisa Lippman of Brown Harris Stevens, who racked up an impressive number of deals in the neighborhood. Some were not included because they were sponsor sales.

HIGH-END BROKERS

Midtown (including Central Park South, Midtown South, Midtown West and Clinton) f off-market deals were included in rankings, Lisa Simonsen’s $48 million sale at the Plaza would top any list. But the seller, still unidentiﬁed, apparently chose a less public route to off-load the 6,000-square-foot spread. That leaves Corcoran veteran Leighton Candler at the top in Midtown with one mega $30 million sale. Hedge fund manager Scott Bommer ﬁrst enlisted Candler to help sell his apartment at the Residences at the Ritz-Carlton in November 2008, just a few months after he bought it for $28.5 million. The 5,800-square-foot unit, one of 12 residences

Top Midtown luxury resale brokers, 2011 NAME

FIRM

SALES

DOLLAR VOLUME

Leighton Candler

Corcoran Group

$30 million

Emilie O’Sullivan

Corcoran Group

$19 million

Victoria Shtainer

Prudential Douglas Elliman 1

$14.65 million

Source: Data is for Midtown, Midtown South, Midtown West, Central Park South and Clinton. See source note on page 43.

50 Gramercy Park North

Marc Dreier. In fact, Jain purchased Dreier’s former home at auction in 2009 for $8.3 million. That unit is adjacent to the more recent purchase, which Shtainer listed for $16.5 million.

Midtown East (including Sutton Place, Turtle Bay, Kips Bay and Murray Hill) he Midtown East designation is a tricky one, since it encompasses the exclusive prewar co-ops of Sutton Place, such as the Sovereign and River House, as well as the more moderately priced homes of Kips Bay and Murray Hill, where local brokers say first-time homebuyers are fueling the market. Not surprisingly, it’s the agents finding buyers for the former who are pulling in the highest dollar volume of sales in the area. In 2011, Kathy Sloane — one of only three brokers to make the top-three list in more than one neighborhood — finally sold Broadway producer Marty Richards’ 14-room maisonette at River House. Richards first listed the two-level residence in 2007 at $22.7 million; the unit went into contract in January 2008, but the deal fell apart. The Art Deco building at 435 East 52nd Street is one of the city’s strictest co-ops. Then, in October 2008, as the world was reeling from an economic tailspin, the apartment went back on the market for a more austere $13.9 million. It finally sold for $11.65 million in February to the Chilean investment advisor Manuel Balbontin. Deborah Grubman and David Dubin, who also made the list in Tribeca, sold an apartment at River From top: Ann Jeffery & Deborah Grubman

Top Midtown East luxury resale brokers, 2011 NAME

FIRM

SALES

DOLLAR VOLUME

Kathy Sloane

Brown Harris Stevens

$11.65 million

Deborah Grubman and David Dubin

Corcoran Group

$10.1 million

Ann Jeffery

Brown Harris Stevens

$8 million

Source: Data is for Midtown East, Sutton Place, Turtle Bay, Kips Bay and Murray Hill. See source note on page 43.

From left: Leighton Candler, Emilie O’Sullivan and Victoria Shtainer.

above the hotel at 50 Central Park South, jumped on and off the market until it sold for $30 million in October 2010. The sale was recorded in August. It was not immediately clear what accounted for the lag. Meanwhile, Emilie O’Sullivan’s sale of two units at the Plaza may not have broken city records, but at $19 million, it was hefty nonetheless. O’Sullivan, of Corcoran, represented Gigi Mahon, an author and interior decorator who bought the adjacent apartments in 2007 for roughly $3.8 million and $10.3 million. “It just seemed crazy not to buy two [apartments] since their terraces were so close together,” Mahon told The Real Deal. A New Jersey native who visited the Plaza as a child, Mahon was initially wary of developer El-Ad Properties’ plan to convert the upper levels to condos. But she eventually came to think of it as the property’s salvation. Mahon, who is currently living in Palm Beach, Fla., sold the apartments to afford her a financial cushion. “It just gave me a whole heck of a lot of security,” she said. The buyer was reportedly Barbara Garza, a director of Mexican bottler Coca-Cola Femsa S.A.B. de C.V. Ranking third was Elliman’s Victoria Shtainer, who has handled numerous deals at One Beacon Court. The deal that landed her on the list was her sale of the 34th-floor, four-bedroom condo owned by Wvc Holdings, an undisclosed entity, to Berkshire Hathaway executive Ajit Jain for almost $14.7 million. Also known as the Bloomberg Tower, the 105-unit building has welcomed numerous celebrities, including pop star Beyoncé, NBC newsman Brian Williams, baseball star Johnny Damon and two attorneys convicted of financial fraud, Scott Rothstein and

House owned by Goldman Sachs executive Roy Zuckerberg, who also sits on the board of the Mack-Cali Realty Corp, for $10.1 million. Evidently, buyers Firoozeh Foulon and Christopher Toub, a bigwig at the investment ﬁrm AllianceBernstein, passed the River House co-op board’s test. The deal was the Corcoran duo’s biggest Midtown East deal of 2011 and their only one above $5 million in the neighborhood. Meanwhile, Ann Jeffery, a senior vice president and managing director at Brown Harris Stevens, brokered the $8 million sale of a co-op at 1 Sutton Place South, which was ﬁrst listed at $8.5 million. The owners were Gavin McFarland, a banker, and Hannah Griswold, a fund-raising consultant who formed the Young Lions fund-raising program for the New York Public Library. They paid $5.6 million for the home in June 2008. Charles Moss Jr., the head of Bow Tie Partners, a New York and Aspen, Colo.-based real estate and entertainment business, bought the residence. Jeffery also sold a Park Avenue co-op and a Fifth Avenue co-op on the Upper East Side for $24.9 million and $6.5 million, respectively, which were not counted toward the Midtown East total.

Flatiron District and Gramercy Park

he Flatiron District has undergone some serious changes in recent years, with additions like Mario Batali’s Eataly food complex, the renaissance of Madison Square Park and new developments like 15 Union Square West and the Cammeyer bringing condo dwellers to the area. When it comes to Gramercy Park, however, the luxury sales are clustered around that exclusive stretch of green that gives the neighborhood its name. In February of last year, Corcoran senior vice president Tim Cass sold a duplex penthouse at 50 Gramercy Park North belonging to the Icelandic retail tycoon Jon

www.TheRealDeal.com February 2012 45

HIGH-END BROKERS Top luxury resale brokers in Flatiron District and Gramercy, 2011 NAME

FIRM

SALES

DOLLAR VOLUME

Tim Cass

Corcoran Group

$22.01 million

Steven Ganz and Jonathan Isaacs

Aligned Real Estate

$14.6 million

Lisa Simonsen

Prudential Douglas Elliman 1

$7 million

Source: See source note on page 43.

Steinberg remained tight-lipped about his clients, but said that last year none of them were tabloid fodder. “We don’t want Kardashianism in our real estate — although if they did come along with the right check, we might succumb,” he joked. Core’s Emily Beare spent much of 2011 in the Flatiron District, heading up the sales ofﬁce at Savanna Partners’ 141 Fifth Avenue, where the last remaining unit, the $13.3 million cupola penthouse, sold in April. Said Beare, “141 was my baby.” That sale, however, did not count toward her total because it was a sponsor sale. Instead, it was the early sale of a penthouse at 252 Seventh Avenue that put her on the ranking — and in Chelsea no less. Known as the Chelsea Mercantile, the building is home to Montreal Canadiens hockey player Scott Gomez. Rungravee and Larry Wienman sold their 3,800-square-foot four-bedroom there for $7 million in January 2011. Elliman’s Richelle Spindell ranked third with a nearly $6.4 million unit in the Steiner building at 257 West 17th Street for ﬁnancier Jonathan Copplestone and Lisa Pomerantz, a fashion marketing executive. The 4,000-square-foot apartment was fashioned out of two units, one of which the couple bought for less than $750,000 in 1996, before the building was converted to lofts.

Top Chelsea luxury resale brokers, 2011 NAME

31 West 21st Street

From left: Jonathan Isaacs and Steve Ganz.

Asgeir Johannesson for $22 million. Now, the Icelandic LLC–like entity that bought the apartment appears to be attempting to ﬂip it, looking to Cass again to help. Johannesson listed the unit in June for $21.4 million. It was then taken off the market, and then relisted in January after a 12 percent price cut. Cass

declined to discuss the transaction. Meanwhile, Aligned Real Estate founders Jonathan Isaacs and Steven Ganz, formerly of Core, handled the $14.6 million sale of the 10,000-square-foot duplex penthouse at 31 West 21st Street featured in the film “Wall Street: Money Never Sleeps.” The seller was financier Richard Weissman, who paid $1.4 million for the pad in 2003. While the unit’s star turn garnered some attention, it didn’t bump up the price, Isaacs explained. “Somebody at that price point isn’t buying based on the movie,” he said. Speaking of star power, at least when it comes to real estate, Lisa Simonsen got her fair share of attention last year for brokering the apparently off-market $48 million sale of a combination unit at the Plaza acquired by Igor Krutoy, the founder of Russian MTV, touted as the most expensive condo sale in New York’s history (see above). But it was a smaller deal at 50 Gramercy Park North that put her on the ranking in this neighborhood. Simonsen sold a three-bedroom unit for money manager Thomas Marsico, who was twice named to Forbes’ list of the 400 Richest Americans, for $7 million. The buyer was an LLC, but news reports indicated that actor Jennifer Aniston was behind the purchase. She had toured an apartment in the building in the summer. Like Johannesson’s former home, the residence sits atop the Gramercy Park Hotel, the posh conversion backed by Ian Schrager and designed by John Pawson that bestows upon owners a key to the private park. Simonsen, who touts her “highly discreet” service on her firm profile, did not return a request for comment.

Chelsea

n recent years, Chelsea has been a breeding ground for new condominiums, and some of the neighborhood’s highest-grossing agents are working at the sales ofﬁces of these developments, such as the Jean Nouvel–designed 100 Eleventh Avenue, 305W16 and +aRt at 540 West 28th Street. Meanwhile, the high-powered Elliman team of Leonard Steinberg and partner Hervé Senequier were busy closing these, and other, kinds of deals. They sold two units over the $5 million mark in the neighborhood, totaling $12.6 million. In August, the two sold a T-shaped four-bedroom loft with a 1,000-square-foot outdoor terrace at the Eagle, an almost 12-year-old condo building at 532 West 22nd Street, and fetched $6.65 million.

46 February 2012 www.TheRealDeal.com

FIRM

SALES

DOLLAR VOLUME

Leonard Steinberg and Hervé Senequier Prudential Douglas Elliman 2

$12.63 million

Emily Beare

Core

$7 million

Richelle Spindell

Prudential Douglas Elliman 1

$6.4 million

Source: See source note on page 43.

532 West 22nd Street

“Their architect did, really, an incredible job,” Spindell said. The result was featured in the Best of Elle Décor Book, and spiritual guru Deepak Chopra was among the would-be buyers who came to check out From left: Richelle Spindell and Emily Beare. the spread, Spindell said. Ultimately it went to Raphael Marquez, a member of the New York Red Bulls soccer team. “My entire business is built on referrals and repeat business,” said Spindell, who lives on Sutton Place but enthuses about Chelsea. “I’ve had a lot of people who’ve moved to different areas of the city.”

West Village and Greenwich Village

orcoran’s Robby Browne may live on Central Park West, but he racked up several high-priced West Village deals last year with his three team members. Browne closed four $5 million-plus deals worth a combined $33.11 million in the neighborhood. At 147 Waverly Place, Browne sold two three-bedroom lofts: one belonging to Chipotle founder Stephen Ells for $6.1 million, and another (two floors up) belonging to Alastair Tedford, cofounder of the investment firm Albion Investors, for $7.5 million. (Browne also represented Ells and Tedford when they originally bought the apartments.) Plus, he also handled the sale of the townhouse at 64 Perry Street — next door to the fictional home of Carrie Bradshaw on “Sex and the City” — for the estate of Wheaton Gal-

HIGH-END BROKERS entine, a documentary ﬁlmmaker, and Harold Eliot Leeds, an architect and professor. After 27 days on the market at $8.5 million, the home sold for just over $9 million. “We never said no to a showing, so everyone was able to get in and see the house,” Browne said. Still, there were pricier townhouses on offer in the neighborhood. Last spring, Corcoran’s Eileen Robert represented the Malaysian-born media mogul Clive Ng and model Farrah Summerford in selling their 25-foot-wide townhouse at 20 East 10th Street. The buyers are rumored to be actors Sarah Jessica Parker and Matthew Broderick. But not all townhouses fared so well when it came to getting their asking price. Tim Desmond, Alexa Lambert and Linda Melnick of Stribling and Serena Boardman of Sotheby’s secured about $16.8 million for the sale of 47 West 9th Street — just over half what

Top Soho luxury resale brokers, 2011 NAME

FIRM

SALES

DOLLAR VOLUME

Dennis Mangone

Prudential Douglas Elliman 2

$16.63 million

Meg Siegel

Sotheby’s Int’l Realty

$13.47 million

Arlene Weidberg

Halstead Property

$11.6 million

Source: Data is for Soho, Noho, Nolita and Little Italy. See source note on page 43.

The penthouse at 104 Wooster Street

Top Village luxury resale brokers, 2011 NAME

FIRM

SALES

DOLLAR VOLUME

Robert Browne

Corcoran Group

$33.11 million

Eileen Robert

Corcoran Group

$19 million

Tim Linda 147Desmond, Waverly Melnick, Alexa Lambert and Serena Boardman

Stribling & Associates/ 1 Sotheby’s Int’l Reality

$16.81 million

Source: See source note on page 43.

147 Waverly Place

the seller hoped to get. Andre Singer, a Belgian real estate developer, bought the property for $12.7 million when he moved to New York in August 2008. At the time, the dilapidated building housed four market-rate rental units, but Singer planned a massive renovation. “This was a house that was a prime candidate for what he was looking to do,” said Desmond, who represented Singer in both deals. The developer outﬁtted the 28-foot wide townhouse with an elevator, screening room, gym and 1,000-bottle wine cellar. He put the 9,000-square-foot home on the market for From top: Robby Browne, Linda $28.5 million in February, and cross-listed it with Strib- Melnick and Alexa Lambert. ling and Sotheby’s to get the widest exposure, Desmond said, though he added that the brokers advised pricing it in the low 20s. “He wanted to shoot for the moon,” Desmond said. “He probably was disappointed, but that is the nature of this business.”

Soho (including Little Italy, Noho and Nolita) he luxury sales in Soho in 2011 exempliﬁed the breadth of housing stock there, from the renovated artist lofts in Soho proper to the new developments rising to the north. Elliman’s Dennis Mangone helped hotelier Ian Schrager sell an $11 million four-bedroom duplex penthouse at 285 Lafayette Street that boasts 23-foot ceilings in the living room and a sky-lit private gym. (He co-listed it with Kirk Rundhaug of Core.) At 40 Bond Street, the Herzog & de Meuron–designed development where both Schrager and Mangone own condos, the broker also sold a $5.6 million unit, reportedly to the same London-based family that purchased two other units in the building. Mangone, who joined Elliman from Brown Harris Stevens about a year ago, has a roster of boldface names on his client list, including Ricky Martin, Beyoncé and fashion photographer Mario Testino. Despite his Downtown address, he said his business is focused on lifestyle, not geography. “I work with developers that have a proven track record, and I see who they hire to

be the architect of the building and where the land is located, and I look at the floor plans and the views and the finishes,” he said. Meanwhile, Sotheby’s Meg Siegel handled four listings on Soho’s Wooster Street, a cobblestone road of fin-de-siècle loft buildings. Two From left: Arlene Weidberg and Dennis Mangone. deals topped $5 million. The priciest sale was a penthouse at No. 102 owned by investor Erik Postnieks and his wife, Lynn, for $8.2 million in July. The home, first listed at $10.5 million in March 2010, spent more than a year on the market, and the Postnieks sliced the price five times before signing a deal. That kind of tinkering was par for the course in the neighborhood, said Soho-based Siegel. “I had sellers who were really uncertain where the market was, so we found the market, and some of the deals took a little time to do that.” Siegel also sold a $5.25 million loft at No. 104. Arlene Weidberg, an executive vice president at Halstead, helped Susan Bloomberg, Mayor Michael Bloomberg’s ex-wife, off-load two adjacent penthouses at One Kenmare Square for a total of $11.6 million in November. Bloomberg, the mother of the mayor’s two daughters, bought the units in 2006 for $10.3 million. Painted in eye-popping pinks and yellows, the apartments come with a 4,000-square-foot private rooftop terrace, but they were never combined. The buyer, an LLC, purchased both.

Tribeca

or Deborah Grubman, 2011 marked a full year without former partner Carol Cohen, who was allegedly forced out of Corcoran in December 2010 in response to (now dismissed) allegations that she scammed a rent-stabilized apartment. Now working with From left: Daniel Hedaya and Dolly Lenz. David Dubin, Grubman’s biggest Tribeca sale of the year — by a long shot — was the three-level penthouse at 25 North Moore Street, also known as the Atalanta. The seller Continued on page 91

Top Tribeca luxury resale brokers, 2011 NAME

FIRM

SALES

DOLLAR VOLUME

Deborah Grubman and David Dubin

Corcoran Group

$17.11 million

Daniel Hedaya

Platinum Properties

$11.5 million

Dolly Lenz

Prudential Douglas Elliman 1

$8.6 million

Source: See source note on page 43.

www.TheRealDeal.com October 2008www.TheRealDeal.com February 2012 47

NYC investors take aim at Europe

Developers and private equity ﬁrms look to take advantage of ‘imploding’ economy

BY JANNA HERRON ith every crisis comes opportunity, and the European debt crisis is no exception — especially for savvy real estate investors. The uncertainty on the continent has brought a battered currency, struggling economy and stubbornly high unemployment. Indeed, financial land mines have popped up from the Mediterranean to the Celtic seas. The European Union has, of course, pushed through bailouts for Greece, Ireland and Portugal while imposing depressionstyle austerity measures to stop the financial hemorrhaging, but so far the global markets aren’t convinced. Meanwhile, the distress has trickled into the European real estate markets. Real estate investment in Europe has slowed noticeably in recent months and a year-end report from the CBRE Group confirmed an investment divide between the financially stronger northern European countries and the economically afflicted southern ones. For example, commercial real estate investment activity in Italy dropped 35 percent in the fourth quarter from the previous period, CBRE said. By contrast, investment activity in France, the Nordic countries, Belgium and Luxembourg all jumped by 40 percent or more during that time. The U.K. and Germany saw smaller increases in investment, but still saw rises in the single digits. The report did not break out activity for Portugal, Spain and Greece, but said generally that Portugal, Spain and Italy all suffered lower activity last year versus 2010. A recent report from Real Capital Analytics also found that cap rates — which measure the rate of return on a real estate investment — in Southern Europe were between 7 percent and 7.5 percent, showing that properties there were less valuable than in Northern and Western Europe, where the rates were 6.5 percent. Meanwhile, American real estate investors, many of them headquartered in New York, have been watching the drama unfold. And some have started sniffing for bargains.

Boots on the ground “Europe is going to implode,” Barry Sternlicht, the CEO of Starwood Property Trust, declared a few months ago at an NYU Schack Institute of Real Estate conference. With that, he noted that his real estate investment trust was working on eight mixeduse and residential property deals there, according to the Wall Street Journal. Sternlicht isn’t the only big New York City area real estate investor targeting European distressed deals. The Carlton Group just brought in a “major European investment banker” who spent the last 12 years at Lehman Broth48 February 2012 www.TheRealDeal.com

Hot investment areas in Europe...

From left to right: London, Berlin and Paris are among the European locales that investors are most attracted to right now.

Cold investment areas in Europe...

From left to right: Athens, Dublin and Florence reside in European countries considered less desirable as investments right now.

ers and Apollo, said Howard Michaels, the company’s chairman. The new hire joins about a dozen others at the firm focusing solely on European business. The company opened an office in London in April and in Athens in September, and recently hosted a luncheon in Spain for 50 bankers, some clients and some potential clients, to help their institutions sell distressed assets or recapitalize existing positions. It also has people in Italy and is helping European institutions come up with plans to sell non-core or toxic assets along with loan positions, Michaels said. “For the most part, a lot of the funds that presently are headquartered in New York are regularly making trips to Europe to invest overseas,” he told The Real Deal. “Obviously, there is a lot of distress in Europe, with assets and companies both trading at significant discounts.” In addition to the Carlton Group, other

New York–based investors that are taking advantage of conditions in Europe include Fortress Investment Group, the Blackstone Group and TIAA-CREF, a provider of retirement services for the academic, research, medical and cultural industries, said Steve Collins, the international director of Jones Lang LaSalle’s international capital group. According to Real Capital Analytics, two New York–based ﬁrms ranked in the top 10 for most active buyers in Europe last year through the third quarter. The Blackstone Group, headed by Stephen Schwarzman, ranked third, buying 26 properties worth 1.65 billion euros, or $2.05 billion. Cerberus Capital Management, also native to New York, came in tenth. Only two other U.S. institutions — AEW Capital Management and Invesco Real Estate — broke into the Top 20. Blackstone’s acquisitions included the European hotel chain Mint. It bought the

eight-hotel portfolio in September for 600 million pounds, or $948.4 million. The group also scooped up a German multifamily portfolio for 220 million euros, or $282.3 million. JLL’s Collins added that high-net-worth individuals are also looking for European deals, while pension funds are a bit more cautious, opting instead to invest through a fund vehicle. “It’s all an allocation issue. Some have jumped in, and some are just looking because they’re sensitive to the market falling in the months to come,” Collins said. “However, the big institutions all have European ofﬁces with ‘boots on the ground,’ so they’ll be ready when the time is right to invest.”

Debt at a discount So far, many players have been making indirect real estate investments by buying distressed debt with property as collateral, said Continued on page 88

From left: Starwood’s Barry Sternlicht, the Carlton Group’s Howard Michaels and the Blackstone Group’s Stephen Schwarzman are all taking advantage of the deteriorating economic conditions in Europe to do deals there. PHOTOGRAPH OF MICHAELS FOR THE REAL DEAL BY CHRIS MARTIN

Co-op owners out of time Shareholders ask boards to extend expiring rental allowances BY TRACEY SAMUELSON hen legal recruiter Annie Sud got engaged in 2009, she quickly realized that her 500-squarefoot Chelsea co-op was too small for her and her fiancé, so the couple rented a larger apartment together. But in the depths of the real estate downturn, Sud couldn’t find a buyer willing to match what she’d paid for her co-op only two years earlier. And when she approached the board for permission to rent out the unit, the answer was no: The building had already reached the maximum number of units it allows to be rented at any given time. Sud had no choice but to keep the apartment on the market, sitting empty, while she paid $3,000 for her mortgage each month. It finally sold in October 2011 for less than the purchase price. “Had I been able to rent it out and cover [the] mortgage, I would have held on to it,” Sud said. Nearly all New York City co-ops restrict shareholders’ ability to rent out their apartments, with some prohibiting the practice entirely and others limiting rentals to one or two years at a time.

of quality inventory on the market. Many New York City homeowners delayed selling their apartments and instead became “inadvertent or accidental landlords,” said Halstead Property senior vice president Richard Hamilton. Now, more co-ops are hitting the market. In the fourth quarter of 2011, the number of co-ops on the market in Manhattan rose 4.1 percent to 3,839, up from 3,687 in the same period of 2010, according to a quarterly market report from Prudential Douglas Elliman. The uptick is especially noticeable for less expensive apartments, such as studios and one-bedrooms, brokers said. The inventory increase is giving home-

ing a certain period of time. The reason, explained Core senior vice president Lawrence Rich, is that co-op residents often don’t want transient neighbors. Boards, he said, “want to know who’s in the building.” Banks also view buildings with high owner occupancy as more stable and therefore more worthy of investment. Most banks, as well as Fannie Mae, typically require 70 percent of apartments to be owner-occupied for ﬁnancing, according to Hamilton. But an increasing number of co-op boards are willing to work with shareholders on subletting issues if they provide documentation or bank statements that prove

out the board’s knowledge for two summers, but only charged her tenants $1,200 a month — well below market rate — because she felt her tenants could be discovered and evicted at any time.

Thanks to these restrictions, many Manhattan homeowners — like Sud — are now facing the prospect of selling their apartments at less-than-ideal prices. Many opted to rent out their apartments during the worst troughs of the financial crisis, rather than sell in a down market. Now, however, they have exhausted their buildings’ rental limits. Surprisingly, many co-op boards are reacting to shareholders’ dilemma by bending normally strict rules. “Financial pressures have resulted in pressure on boards to reconsider their policies,” said Bruce Cholst, a partner at the law firm of Rosen Livingston & Cholst in Manhattan, who has recently fielded inquiries from numerous co-op boards about updating their rules.

seekers more apartments to choose from. But for sellers, it means more competition from other owners, who may be willing to accept a lower-than-hoped-for price in order to sell quickly. In 2011’s fourth-quarter, the median sales price for Manhattan coops dropped 7.1 percent year-on-year to $636,407 — its lowest point in two years. These realities have not gone unnoticed by co-op boards. “[Boards] don’t want to reduce the value of apartments in the building by forcing people to sell in a down market,” said Emanuel Edwards, director of management at the Manhattan brokerage and management company Argo Real Estate. In response, a number of co-op boards are modifying normally rigid subletting policies, industry experts said. Many co-ops limit the number of years shareholders can sublet their apartments — two of every five years, for example, and only after they’ve lived in the build-

their financial hardship, Edwards said. Most co-ops don’t want to publicize rule changes. But in the past year, sources pointed to a Chelsea co-op that started allowing shareholders to sublet their apartments for up to five years, instead of the previous maximum of three; an Upper East Side co-op that scrapped a ban on subletting for residents who demonstrated financial hardship; and a Queens co-op that raised the ceiling on the number of units in the building permitted to be sublet at the same time from 20 to 35 percent. Other boards haven’t inked formal changes to their subletting policies, but are allowing some leniency on a case-bycase basis. That way, they can “leave it to the board’s discretion,” Edwards said. Another motivating factor for boards to change their rules is that some owners will rent their apartments, regardless of whether they’re allowed to or not. Sud admitted that she rented her co-op with-

represented the couple in their search for a tenant. But the board insisted that potential subletters go through the same thorough financial vetting as potential buyers. “The process was so difficult, the couple decided to go to London and leave the apartment empty,” explained Rich, who declined to identify the building. And co-op shareholders also shouldn’t expect boards to continue their sublettingfriendly policies once the market improves. In fact, some experts are already seeing boards returning to their stricter ways. “In very difficult times, some coops loosen their standards,” said Aaron Shmulewitz, a partner at Belkin Burden Wenig & Goldman and head of the co-op and condo practice at the Manhattan law firm. “But as the market improves, or as the perception is that the market has improved, board members say, ‘We don’t have to feel sorry for [shareholders] who can’t sell their apartments anymore.’ ” TRD

Inventory uptick For the ﬁrst several years of the ﬁnancial crisis, buyers complained about the lack 50 February 2012 www.TheRealDeal.com

Still no picnic Just because some boards are willing to adjust the rules doesn’t mean they’ll make subletting easy. A luxury building in Sutton Place recently agreed — after a month of deliberating — to let a couple rent out their apartment for a year, after the husband was transferred to London for business, according to Rich, who

ILLUSTRATION FOR THE REAL DEAL BY PETER BONO

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1 8 9 8 th A v e n u e , N e w Yo r k , N Y 1 0 0 1 1 212.721.2500 1 1 5 E a s t 2 3 rd S t r e e t , N e w Yo r k , N Y 1 0 0 1 0 212.475.9000 165 Bedford Avenue, Brooklyn, NY 11211 718.222.1545

Building Blocks How many buildings do you own? Fifteen buildings, with 2,325 units. We have large complexes here in New Jersey, like 624-777 Martin Luther King Boulevard in Newark with 256 units. But right now we’re making a strong push to move back into Manhattan. This month, we’re set to close on 392 rent-stabilized residential units and 45 commercial units between West 105th and West 110th streets. By Jane C. Timm

What are your plans for these new purchases?

As the units turn [over], we’ll be doing significant interior renovations — pretty much a gut renovation of each apartment — that we hope will bring the apartments to market value. We’re not going to be harassing the rent-stabilized tenants or pushing them out, but as they leave, we’ll be upgrading. ... We’re definitely looking to spice up the hallways, make Managing Member, Treetop Development them a lot more hip and modern.

Vital Stats:

Name: Adam Mermelstein

Title:

Age: 32 Hometown: New Rochelle, N.Y. Currently living in: Teaneck, N.J. Landlord life What’s the most challenging part of being a landlord? Maintaining the balance between making money and keeping our investors happy, as well as pleasing the tenants. The landlord-tenant relationship is a difficult one. Sometimes tenants’ needs can be unreasonable, but it is their home, and we try to have an understanding while still being mindful that we’re in this to make money. I once got a call at 4 o’clock in the morning. This woman was screaming that her alarm was on fire and she’s going to die. I sent the super there and her alarm clock was sparking — all she had to do was unplug it.

What’s the best thing? I love talking to people, and I love being out in the field. I was walking through a building with an investor [recently], and a tenant walked into the elevator. I started to get nervous — most of the time, [when] a tenant sees a landlord, the tenant is going to complain. But the tenant gave the most glowing review of the management and the renovations we’d recently done. It made me feel really good.

110 West 116th Street

How did you get into real estate? After graduating [from] college, I started working for two elderly fellows who were slowing down a bit. They flipped buildings in New Jersey. Through working with them, I started to understand real estate, and it also let me make pretty good money. After about a year and a half, I bought my first building on East 6th Street in Manhattan with the money I’d earned.

When did you start your own company? My partner, Azi Mandel, and I have been in business with TreeTop since 2005. ... When we started out, we were initially building and developing condos in New Jersey and New York City. We made a lot of money when things were going well, and we lost a lot of money when things weren’t going well. It’s just too risky selling condos right now. That’s why we decided to get back into multifamily housing and being landlords.

The Post named you New York’s Worst Landlord in 2007. What was that like?

— Mermelstein’s New Jersey properties

That’s my tenant horror story! We purchased 188 South 3rd Street in 2006. It was a 41-unit building in Williamsburg, and the 21 occupied units were on a rent strike, which is one of the reasons we purchased it so cheap. We started renovations and [the tenants] started making false accusations [that they were being pushed out], and defaming my name. There was a “voice vote” for worst landlord — which is where whichever group yells the loudest wins — and my tenants yelled the loudest. The New York Post called me to tell me when I was at lunch with my wife. It ruined my lunch! But at the end of the day, it went to court and the judge made [the tenants] pay back all their back rent. They wouldn’t have had to do that if their accusations were right. We sold the building after 18 months, and doubled our money.

— Mermelstein’s Manhattan properties

The bottom line Why are you focusing on Upper Manhattan? We see [the area] between 100th Street and 125th Street — especially on the West side — as a pocket that’s prime for future growth because of its proximity to Columbia.

Is buying new buildings difficult in today’s climate? It’s a numbers game. If you bid on five or 10 [deals], hopefully one or two of them pan out. There’s a lot of competition for the good deals.

How is the market doing, from your perspective? I think the market has certainly recovered from a year and a half ago on the commercial side — it’s close to the highs of 2006, 2007. As far as housing, I don’t think we’re even close to a recovery.

52 February 2012 www.TheRealDeal.com

PHOTOGRAPH FOR THE REAL DEAL BY JAMES CHANG

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We define our neighborhoods as much as they define us.

730 Fifth Avenue New York, NY 10019 212.242.9900

110 Fifth Avenue New York, NY 10011 212.633.1000

26 Astor Place New York, NY 10003 212.584.6100

88 Greenwich Street New York, NY 10006 212.269.8888

45 Horatio Street New York, NY 10014 212.604.0300

5 BR, 6 BATH WEB ID: 146609

101 CENTRAL PARK WEST

$23.55 M

4 BR, 4.5 BATH WEB ID: 414483

153 FRANKLIN STREET - TH

$50,000

3 BR, 2 BATH WEB ID: 628359

32 WEST 20TH STREET

$2.675 M

4 BR, 3 BATH WEB ID: 711416

132 WEST 22ND STREET

$14,500

4 BR, 4 BATH WEB ID: 539096

263 NINTH AVENUE - PH

$8.85 M

4 BR, 4.5 BATH WEB ID: 668267

75 WALL STREET - PH

$19,500

We define our neighborhoods as much as they define us.

730 Fifth Avenue New York, NY 10019 212.242.9900

110 Fifth Avenue New York, NY 10011 212.633.1000

26 Astor Place New York, NY 10003 212.584.6100

88 Greenwich Street New York, NY 10006 212.269.8888

45 Horatio Street New York, NY 10014 212.604.0300

TOWN Residential, LLC is a licensed real estate broker and proud member of REBNY. Town Residential LLC is a partnership with Thor Equities LLC. We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. We encourage and support an affirmative advertising and marketing program in which there are no barriers to obtaining housing because of race, color, religion, sex, handicap, familial status, or national origin.

PROFILE

Brookﬁeld’s grand plan The Canadian ﬁrm is ramping up its Manhattan presence. Its planned West Side mega project and its attempt to convert Stuy Town into condos are just the start.

BY ADAM PINCUS members that the firm plans to spend $6 f Brookfield Office Properties’ newly ag- billion in Manhattan alone over the next gressive stance in Manhattan isn’t keep- eight years. ing Related Companies’ Stephen Ross That all comes after Brookfield Asset and Silverstein Properties’ Larry Silverstein Management injected $4.3 billion into awake at night, it probably should be. the bankrupt General Growth Properties, Publicly traded Brookfield Office Properties, led by CEO Ric Clark, is looking to lease up as much as 10 million square feet of office space over the next few years in Manhattan — which may be the most space any private company has ever put on the market at one time. The onrush of inventory includes Brookfield’s proposed 5.4 million-square-foot Manhattan West project, as well as 3 million square feet in the World Financial Center, which Brookfield is upgrading. The need for tenants puts Brookfield in direct competition with the aforementioned moguls’ Manhattan mega-developments: Related’s Hudson Yards and Silverstein Properties’ World Trade Center towers. In addition, Brookfield Asset Management — the firm’s Toronto-based parent company — is making its most aggressive plays yet in New York in other areas of real estate. In June, that company, which is also publicly traded, announced plans to pour $250 million into redeveloping the retail in the World Financial Center. That same month, it deepened its New York bench when it brought on Mitchell Rudin, former president and CEO of the the second-largest mall New York Tri-State Region owner in the country, in for CBRE Group, as presi- Rendering of Brookfield’s planned 5.4 2010 and 2011. dent and CEO of U.S. com- million-square-foot Manhattan West “They are an extrememercial operations. And in project, which is going head-to-head ly well-capitalized comwith Related’s Hudson Yards for office September, it expanded its fi- tenants. pany,” said Peter Rinancing division into investguardi, president of the ment sales and announced two other big New York region for commercial firm Jones hires. Lang LaSalle, who added that the firm is In November, the Tenants’ Association well-positioned for its ambitious agenda. at Stuyvesant Town and Peter Cooper Vil- “They have a very strong balance sheet.” lage voted to partner with Brookfield AsBrookfield Asset Management is, in fact, set Management to explore the possibility a sprawling conglomerate that claims $150 of the company buying the massive, 110- billion in a wide variety of assets around building complex and then converting units the globe. And, if it didn’t have enough gofrom rentals to condos. ing on already, Brookfield Office Properties And, in December, it indirectly waded — which counts former New York state suinto the local residential market with its perintendent of banks Diana Taylor, Mayor purchase of Prudential Real Estate and Re- Michael Bloomberg’s longtime girlfriend, location Services — which owns the fran- as a board member — has recently been in chise rights to the city’s largest residential the spotlight as the owner of Zuccotti Park, brokerage, Prudential Douglas Elliman. which became a household name as home Also in December, Clark told an au- base for Occupy Wall Street. dience of Real Estate Board of New York In addition, other subsidiaries of Brook-

field Asset Management generate electricity used in New York, control coal-shipping terminals and even make carry-out bags used in fast food restaurants here. Locally, Brookfield Office Properties has given the company as a whole a reputation

as much office space at once. (An analysis of data from commercial information firm CoStar Group confirms that Brookfield Office Properties has more office space on the market than any other commercial landlord — by far.)

From left: Jerry Larkin, who heads up leasing for Brookfield Office Properties in New York, and Bruce Mosler of Cushman & Wakefield, both of whom Brookfield has tapped to help lease its planned Manhattan West project.

With 10 million square feet of ofﬁce space to lease up, the company is now facing the biggest test of its New York tenure.

56 February 2012 www.TheRealDeal.com

as a measured and careful player. It is in a strong position following the downturn, largely because it didn’t make any losing bets in New York during the upswing. But with so many projects in the air simultaneously, the company — which has had a presence in New York since it bought the World Financial Center from bankrupt commercial landlord Olympia & York in the 1990s — is now facing the biggest test of its New York tenure. “Starting out in 2012, they now have a lot of commercial space — potentially available [as well as currently available] — in their portfolio,” Riguardi said.

New territory Brookfield’s office division has been a lowkey presence in New York since its World Financial Center purchase in 1996. But it is now pursuing a number of company “firsts” — which in some cases are firsts for the city. For starters, sources say, no private firm has ever attempted to come to market with

While Brookfield is in a strong financial position to lure tenants with lower rents and other inducements, CoStar shows it has a looming 5 million square feet — or 25 percent of its nearly 20 million-square-foot Manhattan portfolio — available for direct lease. That is only in the firm’s 10 existing Manhattan office buildings, and does not count the mega West Side complex, set to rise right near Related’s Hudson Yards, a block west of Penn Station. On the one hand, that’s a landlord’s dream, because it can likely sign tenants at rents higher than those with in-place, expiring leases. But even Clark was cautious. In June, speaking at a real estate investment trust conference in Midtown, he said the company might not top some expiring leases at World Financial Center. While the leasing market has been active, employment has not yet fully recovered, and there are not as many tenants absorbing big blocks of space the way financial services firms did during the boom years.

PHOTOGRAPH OF LARKIN AND MOSLER FOR THE REAL DEAL BY CHRIS MARTIN

PROFILE The World Financial Center, which Brookﬁeld owns and is currently upgrading

Brookﬁeld’s NYC ofﬁce space on the market BUILDING

TOTAL S.F.

AVAIL. FOR DIRECT LEASE

% OF BUILDING AVAIL.

EXISTING BUILDINGS

2 World Financial Center

2.59 million

1.81 million

69.7%

4 World Financial Center

1.9 million

1.23 million

64.5%

1 New York Plaza

2.46 million

613,884

25.0%

450 West 33rd Street

1.74 million

378,492

21.7%

1 Liberty Plaza

2.3 million

285,754

12.4%

1 World Financial Center

1.88 million

222,791

11.9%

1114 Sixth Avenue

1.58 million

140,028

8.9%

245 Park Avenue

1.59 million

66,937

4.2%

3 World Financial Center

2.26 million

85,314

3.8%

300 Madison Avenue

1.07 million

n/a

0.0%

Total

19.37 million

4.83 million

24.9%

5.4 million

100.0%

Ric Clark, CEO of Brookﬁeld Ofﬁce Properties.

PLANNED PROJECTS

Manhattan West (planned ofﬁce complex)

5.4 million

Source: CoStar Group.

Prudential Douglas Elliman CEO Dottie Herman has a newfound connection to Brookﬁeld after it purchased Prudential Real Estate and Relocation Services.

Brookﬁeld is trying to do its ﬁrst NYC condo conversion at Stuy Town and Peter Cooper Village.

From left: Ronald Solarz and Eric Anton were hired from Eastern Consolidated to expand the global investment bank Brookﬁeld Financial.

Yet the firm has leased about 2.5 million square feet of space in 2011, company senior vice president in the New York office, Jerry Larkin, told The Real Deal. He also said he’s confident his new and existing buildings will be competitive. Still, Brookfield will have to nab some of the largest tenants in the market to have a chance of successfully leasing up. Currently, there are an estimated 40 tenants looking for more than 200,000 square feet

Mitch Rudin was hired from CBRE as CEO of U.S. commercial operations for Brookﬁeld Asset Management.

each, hunting for an aggregate of 14 million square feet. Some of the biggest include Time Warner, News Corp. and Credit Suisse — firms that brokers say are all looking for at least 1 million square feet of space. To catch these big fish at Manhattan West, Brookfield is deviating from its usual strategy of handling leasing in-house, and has tapped a team led by Bruce Mosler, the chairman of global brokerage at Cushman & Wakefield, to help with the lease up.

PHOTOGRAPH OF HERMAN FOR THE REAL DEAL BY MICHAEL TOOLAN

Brookﬁeld Asset Management board member Diana Taylor, who’s also Mayor Michael Bloomberg’s girlfriend and the former NYS Banking Commissioner.

While construction hasn’t started at the site, a company in Italy is building a sophisticated piece of construction equipment that will be shipped here to build the $300 million platform over the site’s commuter train tracks, Larkin said. While construction on the platform will move forward once that mechanism is delivered, the company will not start constructing the actual towers until it signs an anchor tenant, he said. Mosler declined to identify which ten-

ants his team was courting, but said, “We are meeting with the obvious players, with some growth tenants that are in the media sector, [and] some financial tenants that find efficiencies in this building and want to consolidate multiple sites.” One factor that may work to Brookfield’s advantage is that it will have two different generations of buildings at different price points. For example, the World Financial Center, built in the mid-1980s with, as one critic said, “punch windows,” will have asking rents in the $50-per-foot range. (Larkin did not rule out hiring a third-party brokerage to help lease up that site, too.) By contrast, Manhattan West will have the latest modern amenities, and it will compete against other brand-new towers, like the World Trade Center, Boston Properties’ 250 West 55th Street and even the SJP Properties speculative tower at 11 Times Square. Asking rents are now in the $70-to-$80-per-foot range, Larkin said. Meanwhile, Brookfield and Related are vying to get into the ground first with their competing Far West Side projects. “At the end of the day it comes down to the gross rent that both parties are going to be offering, and that is where the competition is going to be,” Larkin said. Some give Related a better chance because it has a larger 40 percent tax break for tenants, and has already inked an office user: designer Coach. Because of that, Related has committed to providing them space in the 1.7 million-square-foot tower by late 2015, a Related source said. In addition, it is offering tenants the option of buying “at cost,” meaning the $700 per square foot that it is paying to build, or leasing for about $70 per square foot, in a building that will be near the new terminal for the 7 train. Yet, despite the proximity to the new station, some knocked Hudson Yards for being too far west. While Manhattan West, on the other hand, has a lower, 25 percent tax break, it is one avenue from the city’s most active transit hub: Penn Station. “From a timing perspective, I think [Brookfield] is going to be ahead of Related,” said Richard Bernstein, vice chairman at Cassidy Turley, pointing to the simpler process of building a foundation platform at Brookfield’s site. “There is a lack of supply in the market overall for good quality, large blocks of space.” Still, some brokers are skeptical about the location of both projects and question how much interest either developer will garner until more space is leased in Midtown proper. The difficulty was underscored last month when Silverstein said his company may cap 3 World Trade Center at just seven retail floors if it can’t attract an anchor office tenant by the end of the year. “For most tenants, [either project] will be out of the way,” Michael T. Cohen, president of the Tri-State Region for Colliers International, said. “I think with all the space Continued on page 88

www.TheRealDeal.com February 2012 57

THIS MONTH IN

REAL ESTATE HISTORY The Real Deal looks back at some of New York’s biggest real estate stories 1967: FIRMS BEGIN CORPORATE EXODUS FROM NYC

ajor corporations like PepsiCo and the American Can Company announced they would leave Manhattan for suburban campuses 45 years ago this month, making them among the first in a commercial real estate exodus that battered the city the following decade. PepsiCo, which was based at 500 Park Avenue, relocated to Purchase, in Westchester County, while American Can, which was based at 100 Park Avenue, consolidated its 2,000 employees in Greenwich, Conn. They both relocated a few years after the 1967 announcements. In addition, the chemical company Olin Mathieson, another major employer in the city, announced plans to move its corporate headquarters to Stamford, Conn., taking 700 employees with it. The city was stung by the departures of these firms, but Mayor John Lindsay advisors to the then-mayor, John Lindsay, said they would not have a serious impact on the economy. Still, the corporate exodus continued, with firms complaining about the lack of qualified clerical workers in the city, the elevated cost of business and the overall decline in quality of life. The trend began to reverse in the 1990s, when major Fortune 500 firms returned to the city.

1926: GM SIGNS RECORD LEASE AT 1775 BROADWAY

RHE_RealDealAD_11-2011.pdf

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utomobile giant General Motors signed a 21-year lease worth $14.7 million that, at the time, was the city’s most expensive office rental contract ever, 86 years ago this month. The Detroit-based car manufacturer inked the deal for its East Coast headquarters on the 13 uppermost floors of a planned 26-story building at 1775 Broadway, between 57th and 58th streets. The property owners were adding the floors to an existing three-story building that was part of Manhattan’s Automobile Row. The 768,565-square-foot building — first named for General Motors, then for Newsweek and now known as 3 Columbus Circle — was completed in 1927. Despite the income from the long-term lease, the build- The under-construction 1775 Broadway ing’s owners could not keep up with mortgage payments, and in 1934 the building was sold in a foreclosure auction for $15,000, including the assumption of $8.3 million in debt. General Motors remained until 1968, when it moved to the new 767 Fifth Avenue skyscraper. A more recent owner of the property, Joseph Moinian, almost lost the building in 2010, but real estate investment trust SL Green Realty provided financing that allowed him to hold on. In 2011, the partners completed a rehabilitation of the building, where a glass curtain wall has replaced the original masonry façade.

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presidential commission selected the two-block site owned by the Pennsylvania Railroad as the new location for New York City’s U.S. General Post Ofﬁce building 109 years ago this month. The site between Eighth and Ninth avenues and 31st and 33rd streets is directly over the Pennsylvania Railroad’s tracks on Manhattan’s West Side, and adjacent to the rail company’s passenger terminal. At the time, planners anticipated that the construction of the sprawling strucThe James A. Farley Building ture at 421 Eighth Avenue — now designated a city landmark and known as the James A. Farley Building —would take just a year to complete and would open in 1905. But construction didn’t even start on the McKim, Mead & White-designed ﬁve-story building until 1910. It was completed in 1913 at an estimated cost of $6 million. Compiled by Adam Pincus

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SUBURBS

The’burbs I BY PETER KIEFEr t’s a question many New Yorkers, especially those with children, ask themselves at some point: Buy an apartment in the city, or spend the same amount on a spacious house in the suburbs? When choosing the latter, New Yorkers often flock to the stately homes, McMansions and well-tended lawns of a few affluent counties just outside the city’s borders: Westchester and Nassau counties in New York, Fairfield County in Connecticut and Bergen County in New Jersey. This month, The Real Deal checked in on these wealthy areas to see how their residential real estate prices are holding up. We discovered that the real estate markets in these wealthy tri-state area suburbs mostly softened in 2011 compared to 2010 in terms of prices and sales activity amid national and global economic turmoil.

A look at the wealthiest just-outside-NYC counties, including their top deals Like Manhattan, bucolic towns in these areas have star-studded residents ranging from Governor Andrew Cuomo to hip-hop artist Russell Simmons to Yankees ﬁrst baseman Mark Teixeira. But even the high-priced deals saw substantial price slashing. Still, suburban super brokers told The Real Deal that they are already more optimistic about 2012. Shawn Elliott, founder and CEO of Shawn Elliott Realty Luxury Homes and Estates in Nassau County, said activity in the luxury market has been “tremendous” so far in 2012. One helpful factor, he said, is the difference in weather between this winter and last. “Last year, we had two feet of snow on the ground from December to March,” said Elliott, who was featured on the HGTV program “Selling New York” last month. “You want to be able to see what you’re buying. Photographs don’t always do [homes] justice.” On the following pages is a closer look at these suburban counties, including their ﬁve priciest sales for 2011.

Nassau: From East Egg to West Egg

Real estate sales in the Long Island county see slight drop, but prices creep up BY PETER KIEFER assau County lost a piece of real estate history last year when the house that reportedly inspired F. Scott Fitzgerald to write “The Great Gatsby” was leveled to make way for a subdivision of five homes. And while both the new money of Fitzgerald’s West Egg and the old money of his East Egg are still home to some of the priciest towns in the New York area, 2011 wasn’t a blockbuster year for the county. The number of Nassau home sales dropped 4 percent last year to 8,434, compared to 8,782 in 2010. Still, at $400,000, the median sales price in 2011 was slightly higher than the $396,000 median registered in the county for 2010, according to data provided by brokerage Prudential Douglas Elliman. Meanwhile, Nassau properties lingered on the market longer than they did in 2010. The average number of days it took to sell a residential property increased last year to 121, up from 113 in 2010. Harding Real Estate’s Patricia Shroyer, who brokered Nassau’s third-priciest 2011 home sale, for $13.88 million, predicted that the health of the real estate market in the coming year would depend on the mentality of sellers. While “2011 was not a great year, [and] 2010 was not a great year,” she said, “I am a little more optimistic in 2012. People are coming to the realization that they can’t ask the prices that they have been asking. The market is just not there.” Shawn Elliott, founder and CEO of the Woodbury-based Shawn Elliott Realty Luxury Homes and Estates, which sold the fourth and fifth priciest Nassau homes in 2011, said 2012 has already started off strong for high-end sales. Elliott said he already has two $10 million offers on the table this year — both from Chinese buyers. In addition, both of his firm’s sales on the top five priciest deals list went to Chinese buyers. “We’re working in Shanghai and Beijing, and I just hired a translator to help work

60 February 2012 www.TheRealDeal.com

Nassau’s priciest residential sales, 2011 ADDRESS

T OW N

L I S T I N G B R O K E R AG E

SALE PRICE

39 Applegreen Drive

Old Westbury

Automatic Real Estate Associates

$15.9 million

127 Horseshoe Road

Mill Neck

Sotheby’s International Realty

$14 million

240 Middle Neck Road

Sands Point

Harding Real Estate

$13.88 million

1 Bel Air Court

Upper Brookville

Shawn Elliott Luxury Homes and Estates

$10.4 million

38 Applegreen Drive

Old Westbury

Shawn Elliott Luxury Homes and Estates

$10 million

Source: Miller Samuel

with these buyers,” he said. Here’s a look at some of the county’s priciest 2011 sales.

39 Applegreen Drive once belonged to Gertrude Vanderbilt Whitney (left), founder of the Whitney Museum.

1. 39 Applegreen Drive (Old Westbury)

127 Horseshoe Road sold for $14 million in July.

Robert Redford in the movie “The Great Gatsby.” The Nassau County home that the novel is based on was torn down last year.

Sale price: $15.9 million Original listing price: $16 million Broker: Michael Berman, Automatic Real Estate Associates The brick Georgian mansion at 39 Applegreen Drive in Old Westbury, built in 1925, was once owned by Gertrude Vanderbilt Whitney, founder of the Whitney Museum of American Art, according to Berman. It actually went into contract in late 2010, but didn’t close until 2011, and its $15.9 million dollar price tag made it Nassau’s priciest sale of the year. The 22,000-square-foot, eightbedroom home — complete with an indoor pool — sits on just over nine acres. The stately home was on the market for just six days, and barely dipped below its original listing price of $16 million. Berman said the deal involved a Chinese buyer who paid all-cash, and a seller who works in real estate.

2. 127 Horseshoe Road (Mill Neck) 38 Applegreen Drive in Old Westbury sold for $10 million.

Sale price: $14 million Original listing price: $20 million Broker: Bonnie Devendorf, Sotheby’s International Realty The seven-bedroom, eight-bath Tudor at Continued on page 92

SUBURBS

Thawing out Bergen County

Affluent towns see inventory move, but sellers, including Russell Simmons, take lumps with massive price cuts BY PETER KIEFER n 2011, hip-hop mogul Russell Simmons unloaded his mega-mansion in pricey Saddle River, N.J. — four years after it originally went on the market, and 50 percent below its initial asking price. That aggressive discount typified the soft real estate market throughout New Jersey’s Bergen County last year. “I have lived through downturns in the past, but this is the most significant one I have seen,” said Vicki Gaily, of Special Properties in Saddle River, the buyer-side broker on the Simmons’ sale.

Bergen’s priciest residential sales, 2011 ADDRESS

T OW N

L I S T I N G B R O K E R AG E

SALE PRICE

101 Fox Hedge Road

Saddle River

Prominent Properties Sotheby’s Int’l Realty

$10 million

14 Buckingham Drive

Alpine

Coldwell Banker

$6.2 million

20 Timberline Drive

Alpine

Prominent Properties Sotheby’s Int’l Realty

$5.3 million

6 Oxford Way

Alpine

Prominent Properties Sotheby’s Int’l Realty

$5.1 million

7 Canterbury Road

Alpine

Prominent Properties Sotheby’s Int’l Realty

$5 million

Source: Miron Properties via Multiple Listings Service

14 Buckingham Drive in Alpine sold for $6.2 million.

Alpine, which the New York Times once said was home to “hip-hop music royalty,” has counted (clockwise from top-left) Sean “P. Diddy” Combs, Yankees pitcher CC Sabathia, Stevie Wonder and Lil’ Kim as residents.

Countywide, the number of home sales fell 3 percent in 2011 to 4,418, down from 4,537 in 2010. Meanwhile, the median price for homes that sold in 2011 was down 5 percent to $421,456 from $445,313 in 2010, according to data provided by Coldwell Banker. In addition, it took longer for sellers to unload their homes. In 2011, the average number of days a home spent on the market shot up by 9 percent to 98.9, up from 90.7 in 2010. However, brokers said things are improving, especially for the luxury market. “I do see a change in the confidence of the buyers and in the number of [luxury sales our firm] has achieved in 2011,” Gaily said. According to Ruth Miron, owner of Tenafly-based Miron Properties, which also has a location in New York City, there is evidence high-end homes are increasingly moving. In all of 2010, only 21 properties countywide sold at $3 million or more. In 2011, the number of properties that sold in that category climbed to 35. “During the downturn, the market came to a screeching halt and it very slowly started resuscitating,” said Miron, who’s worked in Bergen County residential sales for 25

years. Since then, “we have seen increased consumer conﬁdence and people are not afraid to once again shop for high-end, luxury real estate.” Another factor, however, is that many high-end Bergen County homes are now deeply discounted. “There has been a thawing-out process,” said Dennis McCormack of Prominent Properties Sotheby’s International Realty, “where a lot of homes, the more tired homes that have been on the market for a good length of time, have sold at very aggressive prices — aggressive for the buyers, that is.” Below is a breakdown of the county’s priciest sales of 2011.

1. 101 Fox Hedge Road (Saddle River) Sale price: $10 million Original listing price: $24 million Broker: Stephanie Rosken, Prominent Properties Sotheby’s International Realty This 35,000-square-foot Saddle River mansion belonged to hip-hop mogul Russell Simmons and his ex-wife Kimora Lee. The home was ﬁrst put on the market in 2007, for an astonishing $24 million. But while the February 2011 sale was Bergen

County’s priciest of the year, the 10-bedroom, 12-bathroom mansion — which has indoor and outdoor swimming pools, staff quarters and, according to published reports, a home movie theater with a ticket booth and popcorn machine — sold for less than half that, after multiple price chops. The house, which the couple reportedly bought for about $13 million in 2001, was also featured on “The Oprah Winfrey Show” and MTV’s “Cribs.” The buyer was described by Gaily only as a “businessman.”

2. 14 Buckingham Drive (Alpine) Sale price: $6.2 million Original listing price: $9.98 million Broker: Michele Kolsky-Assatly, Coldwell Banker This home in ritzy Alpine — which has counted Sean “P. Diddy” Combs, Lil’ Kim and rapper Fabolous as residents, in addition to Stevie Wonder, Yankees pitcher CC Sabathia and many other celebrities — sold for $6.2 million in September, nearly 38 percent less than its original $9.98 million asking price. The 15,000-square-foot colonial was ﬁrst put on the market in February 2010. It has a pool, movie theater, arcade room, elevator and wine cellar to go along

with six bedrooms and seven full bathrooms. “It was a very unusual property because the backyard was all pool,” said Coldwell Banker’s Kolsky-Assalty, the listing agent. “So it took a different kind of client. As it turns out, we sold it to another grownup couple with grandchildren.” She said the seller was in ﬁnance, while the buyer was in “real estate and investments.”

3. 20 Timberline Drive (Alpine) Sale price: $5.3 million Original listing price: $12 million Broker: Dennis McCormack, Prominent Properties Sotheby’s International Realty The third priciest sale in Bergen County was 20 Timberline Drive, also in Alpine. Like Simmons’ home, this 10,400-square-foot, six-bedroom home also came on the market in 2007 and also saw its price chopped by more than 50 percent before selling last September. The home has a banquet-size dining room, a pool and a tennis court. McCormack, the broker, said the seller was a large Korean corporation that also owns homes in Manhattan and Beverly Hills, while the buyer was an international business executive who intends to gut renovate the house. www.TheRealDeal.com February 2012 61

SUBURBS

Fairﬁeld top sales trounce suburban rivals

Greenwich delivers all of the county’s priciest sales, but overall market still slips Fairﬁeld priciest residential sales, 2011 ADDRESS

T OW N

LISTING BROKERAGE

SALE PRICE

80-84 Field Point Circle

Greenwich

Sotheby’s International Realty

$39.5 million

14 Meadow Lane

Greenwich

Prudential Brad Hvolbeck Real Estate

$32.5 million

120 Field Point Circle

Greenwich

David Ogilvy & Associates

$25 million

65 Upper Cross Road

Greenwich

Sotheby’s International Realty

$16 million

80 Lower Cross Road

Greenwich

Sotheby’s International Realty

$14 million

Source: Sotheby’s International Reality via MLS

80-84 Field Point Circle in Greenwich was Fairﬁeld’s priciest 2011 sale at $39.5 million.

Broker: Joseph Barbieri, Sotheby’s International Realty With a closing price of $39.5 million, 80-84 Field Point Circle in Greenwich can lay claim to the largest transaction in any of the suburban areas surveyed by The Real Deal this month. After 258 days on the market, the 21,000-square-foot mansion, which sits on 4.25 acres on the Sound, was snatched up in June after dipping from its original listing price of $42.5 million. The house is a century-old compound that was recently renovated. It has indoor and outdoor pools, two guest houses, a koi pond and, according to Barbieri, an exact replica of the Brooklyn Bridge, which, in photos, appears to be connecting the property to a dock in the Sound. “The house is just extraordinary,” said Barbieri.

2. 14 Meadow Lane (Greenwich)

120 Field Point Circle sold for $25 million and was the third-priciest sale in Fairﬁeld County last year.

From top: TV personality Regis Philbin sold his Greenwich home last month for $3 million. Other celebrity residents include director Ron Howard and Yankees ﬁrst baseman Mark Teixeira.

BY PETER KIEFER s Connecticut’s closest town to New York City, Greenwich — with its spacious estates overlooking Long Island Sound — has long served as a bedroom community for wealthy Wall Streeters. So it’s perhaps not surprising that Fairfield County’s top three sales — all of which were in Greenwich — trounced the top sales in the three other counties The Real Deal looked at this month. In fact, two of those three top sales were even on the same street: Field Point Circle. But despite those blockbuster sales — which saw less-severe discounts than highend properties in the other New York suburbs — the median sales price in Fairfield County as a whole still slipped 2 percent in 2011 from a year earlier. The median Fairfield County sales price in 2011 was $465,000, down from 2010’s $475,000, according to data provided by the Wallingford-based Prudential Con-

62 February 2012 www.TheRealDeal.com

necticut Realty, the largest full service real estate firm in Connecticut. Sales activity in the county — which in addition to wealthy suburbs like Greenwich, Darien and New Canaan, is also home to the struggling cities of Stamford and Bridgeport — also dropped last year to 5,610 sales, falling 6.4 percent from 2010’s 5,994 sales. In addition, homes stayed on the market a little longer in 2011 — 153 days, compared to 148 in 2010. Sotheby’s International Realty’s Joseph Barbieri, the broker on the highest-priced Fairfield County sale of the year, said that those who priced their properties strategically came out ahead. “Value was the name of the game,” he said. “People are looking for exceptional properties and for value.” Fairfield County broker Terry Keegan, vice president of Fairfield County Real Estate Company, echoed that point, noting that part of the problem is that there are unrealistic expectations in the marketplace.

“If sellers are being realistic, then there are plenty of buyers,” he said. TV personality Regis Philbin is a case in point. He unloaded his 5,919-square-foot Greenwich home last month for $3 million — far less than the $5.9 million he’d listed it for in 2008. (Other celebrity residents in the town include director Ron Howard, TV show host Kathy Lee Gifford, Yankees ﬁrst baseman Mark Teixeira and countless others.) “This is a simple business,” Keegan said. “There are plenty of buyers with plenty of money, but realtors are making it tough because they are afraid to tell sellers the way it is. They tell them what they want to hear, and that is why you see those markets dive.” Below is a look at the three priciest Fairﬁeld County sales in 2011.

1. 80-84 Field Point Circle (Greenwich) Sale price: $39.5 million Original listing price: $42.5 million

Sale price: $32.5 million Original listing price: $36.5 million Broker: Brad Hvolbeck, Prudential Brad Hvolbeck Real Estate Coming in at No. 2 is 14 Meadow Lane, which sold after 349 days on the market for $32.5 million. The 14,000-square-foot new-construction home, which was completed in February 2011, sits on a 14-acre estate and has an inﬁnity pool, a four-stall horse stable, a mile-long bridal-walking path and a 3,000-square-foot guest house. The home was originally listed for $36.5 million. Hvolbeck declined to provide details about the buyers or sellers, citing conﬁdentiality. He did say, however, that, “once [the buyers] saw the property, it was not long before they made an offer. The transaction happened quite quickly.”

3. 120 Field Point Circle (Greenwich) Sale price: $25 million Original listing price: $29 million Broker: David Ogilvy, David Ogilvy & Associates A second home on Field Point Circle rounds out the top three priciest sales for Fairfield County. The waterfront stone manor sold for $25 million in April after being on the market for 627 days with an original listing price of $29 million. The 10,000-squarefoot home, which was built in 2003 and designed by architect Thomas Kligerman, has five bedrooms, seven bathrooms, an indoor pool and also has a koi pond. It also has a 70-foot-long great room, with three fireplaces. Ogilvy called it the best built house he had ever been in. The seller, he said, works in finance and the buyer is in the manufacturing industry. “The house is just total perfection. ... You feel as if you are in Europe,” he said. “It really is a remarkable house.”

SUBURBS

Tony Westchester slides into 2012

While home to some of New York’s most powerful players, the real estate market in the county lost value last year BY PETER KIEFER here’s no arguing that Westchester County is exclusive. Indeed, four of the state’s most influential residents — Mayor Michael Bloomberg, Governor Andrew Cuomo and Hillary and Bill Clinton — all own homes in different Westchester County towns (Bloomberg in Bedford, Cuomo in Mount Kisco and the Clintons, of course, in Chappaqua). But last year, New York’s biggest politicians likely lost some value on those properties. That’s because the county, which is known for its quality schools and high taxes, experienced a slight slowdown in 2011 compared to 2010. The median sale price for the county dipped 4.8 percent to $600,000, down from 2010’s median price of $630,000, according to market data from brokerage Houlihan Lawrence, the largest residential brokerage in the county. (Still, that median was higher than the other three wealthy suburbs in The Real Deal’s spread this month.) Meanwhile, the number of Westchester home sales also slipped 4.5 percent last year to 3,838 from 4,018 in 2010. And the average time a listing in the county sat on the market rose 2.8 percent from the prior year to 181 days. In addition, the Journal News, which covers Westchester, cited a report last month from the Hudson Gateway Association of Realtors showing that while sales of homes priced at $1 million-plus have traditionally made up about 16 percent of the county’s annual sale numbers, that has now fallen to 13.7 percent. “We saw some weakness in the upper end,” Richard Haggerty, CEO of the association, told the newspaper. “I think that was because of layoffs on Wall Street and lower bonuses on Wall Street.” Still, Houlihan Lawrence CEO Christopher Meyers said he expects sales volume to pick up in the first two quarters of 2012. “The volatility on Wall Street put a lull out there, which affected us,” he said, “but we had our strongest holiday sales period in years. There were more deals in contract on Dec. 31 than any year since 2002. It feels like there was an inflection point in the fourth quarter.”

1. 290 Stuyvesant Avenue (Rye) Sale price: $11.6 million Original listing price: $12.5 million Broker: Diana Plunkett, Houlihan Lawrence After 135 days on the market, 290 Stuyvesant Avenue in the town of Rye sold in September for $11.6 million, making it the priciest sale in Westchester County — for both 2011 and 2010. Originally listed for $12.5 million, the six-bedroom, 7,991-

Westchester’s priciest residential sales, 2011 ADDRESS

T OW N

L I S T I N G B R O K E R AG E

SALE PRICE

290 Stuyvesant Avenue

Rye

Houlihan Lawrence

$11.6 million

9 Heathcote Road

Scarsdale

Julia B. Fee Sotheby’s International Realty

$10.9 million

336 Stone Hill Road

Pound Ridge

Vincent & Whittemore Real Estate

$8.4 million

31 Lincoln Lane

Purchase

Julia B. Fee Sotheby’s International Realty

$7.9 million

3887 Purchase Street

Purchase

Houlihan Lawrence

$6.5 million

Source: Houlihan Lawrence

290 Stuyvesant Avenue in Rye, which went for $11.6 million, was Westchester’s priciest sale in 2011.

From left: Mayor Bloomberg and the Clintons all own homes in Westchester. Newsman Tom Brokaw is among the celebrities that have called Pound Ridge home.

square-foot home has views of the Long Island Sound and a private dock, as well as a guesthouse and a large exercise room. Plunkett said the buyers, who were represented by brokerage William Raveis, were a young couple with the husband working in ﬁnance. The sellers were also a young couple “looking to make a lifestyle change,” she said. Meyers said he expects more highpriced luxury deals like this one in the coming months as sales volume and prices climb. “This area’s supply is not quite ﬁxed, but it is very limited due to the zoning and other regulations,” he said.

2. 9 Heathcote Road (Scarsdale) Sale price: $10.9 million Original listing price: $18.5 million Broker: Mary Katchis and Dawn Knief, Julia B. Fee Sotheby’s International Realty The second-priciest sale for Westchester County last year was this new-construction

Scarsdale home — with a home theater, tennis court and pool — which sold for $10.9 million. But the sale did not come easily. Not only did the original listing price of $18.5 million get chopped by 41 percent, the home, which is 9,160 square feet and has seven bedrooms, was also on the market for almost two years. That, sources say, speaks to the correction that has occurred in some of the luxury residential markets in the New York suburbs since the Great Recession. Katchis and Knief were the listing agents, while Lisa Pitt of Paddington Stone Realty represented the buyer. Katchis declined to discuss the buyers and sellers on the deal.

3. 336 Stone Hill Road (Pound Ridge) Sale price: $8.4 million Original listing price: $10 million Broker: Kathy Needell, Vincent & Whittemore Real Estate After spending 515 days on the market, 336

Stone Hill Road in Pound Ridge — a town that, according to published reports, has been home to celebrities including newsman Tom Brokaw, actors Tim Robbins and Richard Gere and others — finally sold and, in doing so, became Westchester’s third-priciest sale of 2011. Built in 1935, the 6,954-square-foot home, which is on 12 acres and abuts more than 70 acres of conservancy land, saw a 16 percent price drop. It has five bedrooms in the main house, a two-bedroom guest house and a pool. Needell was the listing agent, while Renwick Sotheby’s International Realty represented the buyer. Needell declined to comment on the buyers and sellers, but noted that the house had extremely detailed woodwork and fixtures, and that the stone floors in the kitchen came from a palace in France. “It was an extraordinary house in detail, style and amenities, and has an unbelievable English garden,” she said. TRD www.TheRealDeal.com February 2012 63

Buying up Brazil

A look at the NYC real estate players investing in South America’s largest nation, inﬂation fears notwithstanding

No more ignoring As a panelist at a Bloomberg Dealmakers Summit in September, Related Companies president Jeff Blau said the Manhattanbased developer is considering opening an office in Brazil. “You can’t ignore these markets, given the slowdown in the U.S.,” Blau said. (A Related spokesperson said last month that there was no news regarding a Brazil office.) Even New York City–based residential real estate firm Rapid Realty said it’s considering opening an office in Brazil (see related 64 February 2012 www.TheRealDeal.com

story on page 30). Meanwhile, Tishman Speyer, which has long invested in Brazil, is also ramping up its investments. The New York firm owns interests in 17 commercial properties in the country — eight of which are either under construction or recently completed. Tishman’s holdings include the 46,200square-foot Virtus and the 328,000-squarefoot Ventura, both ofﬁce towers in Rio de Janeiro; the Fascination Penthous-

Jerry Speyer’s ﬁrm Tishman Speyer owns interests in 17 commercial properties in Brazil.

☛

BY TOM ACITELLI ntil a few years ago, Brazil was but a Plan B among America’s real estate investors. Now they increasingly view South America’s largest nation as a lucrative, and safe, haven for commercial property investment. “Brazil is a democracy, Brazil has a free press, Brazil elected a left-wing president back in 2002,” Hines Interests senior vice president Doug Munro told The Real Deal by phone last month from his São Paulo office. “Brazil [now] has control over its inflation concerns of the past. In the 1980s, Brazil was just a basket case in terms of the management of its economy. “Finally,” he said, “the demographics of Brazil look very similar today to the United States in the 1960s, where [there’s] growth in consumerism [and] increases in salaries — all that was going on and allowed people to build wealth.” In recent years, Brazil has seen rapid commercial and residential development, driven by low interest rates and the nation’s plan to host the 2014 World Cup and the 2016 Summer Olympics. This steady economic growth, particularly the newfound spending power of its citizens, has attracted more U.S. real estate investors, many of them with strong New York ties. And while there are always concerns over Brazil’s history of hyperinflation, these investors mention the nation of 195 million residents in the same breath as India or Russia — even China — in terms of potential for returns on investment. In fact, according to a survey released last month, members of the Association of Foreign Investors in Real Estate voted Brazil the second-best nation for real estate investment — behind only the U.S. Among emerging markets, Brazil was voted No. 1 for the second consecutive year, ahead of China, India and Russia. Investment by New York–related firms began in the late 1990s, but has increased rapidly in the last few years, partly because the Great Recession wreaked such havoc on the American and European economies.

mercial real estate investor in Brazil. The Houston-headquartered ﬁrm — which has several Manhattan properties, including the condo 40 Mercer, the Lipstick Building at 885 Third Avenue, the planned MoMA tower on West 53rd Street and 56 Leonard Street, where it’s partnering with the Alexico Group — entered the Brazilian market with an initial $500 million invest-

☛ Sam Zell’s Equity International is invested in a slew of Brazilian companies, including the country’s biggest mall operator.

A view of Rio de Janeiro, where Hines Interests, Tishman Speyer and other real estate ﬁrms are ramping up their investments.

es, twin apartment towers in São Paulo; the nearly 23-acre Castelo Branco Office Park in the same city, which is slated to have six office towers and a retail component; and the 279,000-square-foot Green Towers commercial building in Brasília. The firm, through a spokesman, declined to comment. Tishman is not the only major New York owner invested in Brazil. Sam Zell’s Equity International has invested in the largest mall owner in Brazil as well as in hotels. The firm is based in Chicago, but is heavily invested in Manhattan. Meanwhile, the Carlyle Group in 2007 took a major stake in Scopel, a Brazilian developer of low- and middle-income housing, and raised nearly $1 billion for a South

American investment fund last year. The private equity giant seems to have pulled away from Brazil for the time being, after being one of the first to become more heavily involved as the recession hit the U.S. and Europe. (Carlyle declined to comment.) Even the California Public Employees’ Retirement System (CalPERS) has gotten in on the action, investing $95 million in a $100 million Brazilian investment fund with Hines in 2005, reaping a $160 million profit from it when the fund was closed in 2011. A CalPERS spokesman said the system is considering other investments in South America, but declined to discuss specifics. Although exact figures are not available, Hines, indeed, may be the largest U.S. com-

☛ Related Companies’ Jeff Blau said the developer is considering opening an ofﬁce in Brazil.

ment in 1998. Interest by big manufacturing and service firms (most of Brazil’s new jobs lay in the service industry) spurred Hines’ entry. “Hines decided to follow those companies, and try and build real estate for them — office, logistics and, in some cases, expatriate housing, that kind of thing,” Munro said. At least that was the initial reason. Now Hines invests because of the promise of Brazil’s economic growth. The firm not only launched the fund with CalPERS, but also owns or manages 22 properties, mostly in São Paulo and Rio de Janeiro, and mostly office buildings, including the 90,000square-foot Coca-Cola headquarters in Rio de Janeiro; and the massive (relatively speaking for Brazil) 481,804-square-foot Panamerica Park, an office hub for São Paulo’s tech industry. Equity International, by contrast, has always invested in companies, rather than in assets. Equity’s biggest Brazil investment so far was a stake in the country’s (and Latin America’s) largest mall operator, BR Malls. It sold 18.2 million shares of it in 2010, pocketing $245 million while retaining a small stake. Last year, the company invested in GuardeAqui, a private self-storage company. Other companies Equity International has invested in recently include AGV Logística, a private logistics company; Brazilian Finance & Real Estate, a private specialty finance company, including real estate finance; and Bracor, a private assetsoutsourcing firm. “What we see in Brazil right now is a lot Continued on page 90

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James Gardner | Architecture Review

Master of the Met At 90, Roche’s newest galleries are among his best yet

ow in his 90th year, Kevin Roche has never seemed more incandescently consequential than he does today. In the past three months, with the completion of an overhaul of both the American and the Islamic wings of the Metropolitan Museum of Art, Roche has lived to see the fulfillment of the master plan that he and his partner, John Dinkeloo, devised over 40 years ago, when the ebullient Thomas Hoving was still the museum’s director. At the same time, Roche has been the subject of an admirably thorough exhibition at the Yale School of Architecture Gallery, “Kevin Roche: Architecture as Environment,” which is now in its last days at the Museum of the City of New York. The exhibition, which will move on to two venues in Canada, coincides with a full-dress monograph on the architect that has the same title as the show. It would be fair to say that Roche was — and remains — one of the major architects working in New York, in both the prominence and quantity of projects that he’s brought to fruition here over the past half-century. That’s not to mention his many projects elsewhere. In addition to the vast amount of work his firm has done at the Met, it has also been responsible for the Central Park Zoo, the Ford Foundation Building at 321 East 42nd Street, the Museum of Jewish Heritage and the United Nations Plaza among others. One of the first winners of the prestigious Pritzker Prize in 1982, Roche’s legacy remains ambiguous: He is famous today for the architecture he designed three or four decades ago, even though the buildings he’s designed in more recent years is — depending upon one’s aesthetic inclinations — better, if also more derivative. Though he speaks American English with hardly a trace of an accent, Roche is an Irishman who arrived in the States just after the end of World War II. Roche moved to Chicago to study with the undisputed, and seemingly infallible, pope of international modernism, Mies van der Rohe. But Roche did not remain long with the master, whom he soon came to find too constricting. In due course he joined forces with one of the most gifted international modernists, Finnish-born Eero Saarinen, whose practice he continued when, in 1961, that architect died of a brain tumor at age 51. Given that architecture has been, in the past century, largely an old man’s game, Roche achieved success very early. He was just 40 when his firm, Kevin Roche John Dinkeloo and Associates, or KRJDA, got the commission to design its masterpiece, 66 February 2012 www.TheRealDeal.com

the Ford Foundation Building, a brutalist cube near the East River. What is so striking about the 20-story building is that the interior was hollowed out to form a massive indoor garden. Conceived during the true “Mad Men” age, this building seems to incarnate the spirit of those times — the age of the corporation man. More even than Skidmore, Owings & Merrill, KRJDA was, architecturally, the spearhead of this movement. In a 1967 lecture, Roche made the astounding claim that if architecture is “to

It was in this spirit, unfortunately, that Roche undertook, starting in 1967, to manage the expansion of the Met. One would be hard-pressed to conceive of an aesthetic more doctrinally opposed to that of the museum’s preexisting Beaux Arts structures along Fifth Avenue than the weary, paltry glass grids that made up the surroundings of the Temple of Dendur. In total, his expansion of the museum over the last four decades makes up several acres of thoroughly undistinguished architecture (seen both from the inside and the

Roche has been the subject of an exhibition, which is now in its last days at the Museum of the City of New York.

The American Wing of the Met, which Roche recently redesigned

Beaux Arts architecture, fashioned so convincingly from granite and marble that few visitors to the museum are apt to realize that it’s not from the turn of the last century. Which brings us to Roche’s latest contributions to the museum — the American and Islamic wings, conceived in a historicist style as committed as was evident in the Petrie Court. Both are surely improvements over the previous incarnations of the galleries (which, by the way, were also designed by Roche’s ﬁrm). Now the American Wing’s new galleries have been divided up into 25 The Roche-designed Ford Foundation Building, a brutalist cube, was spaces, totaling 30,000 square constructed in the 1960s. feet, designed in a Beaux Arts style that feels more open and inviting. It features high-coved ceilings, skylights and walls painted a warm and soothing gray, accented with granite and limestone. If there is a conservative feel to those galleries, with a general consistency to the size and shape and style of the rooms, the Islamic galleries daringly integrate ancient architectural episodes into a very authentic-looking context. One passes over alabaster ﬂoors to a qa’a, or reception room, built in Damascus in 1707. From there, one moves under an expansive 16th-century dropped ceiling of Another view of the Met’s American Wing

Roche is one of the major architects working in New York, in both the prominence and quantity of projects that he’s brought to fruition here over the past half-century. truly succeed, it has to be the size of our government’s aerospace program.” In those few words he summed up, better and more pointedly than any parody, the ethos of the early ’60s. Systems theory, with its relentless grids and its arid theories, ruled the day, and no one expressed its ambitions in purer form than Roche. Whereas his colleague Saarinen was a moody poet of evocative forms, Roche seemed to wish to expunge the human spirit from his pure forms. We see this in some of his earlier work at the Met, no less than at the Ford Foundation and at United Nations Plaza.

exterior) jutting into Central Park. But sometime around 1990 a curious transformation came over Roche: He discovered contextualism and a lyrical historicism that were the very antithesis of the earlier style he remains associated with. Some of his projects, like the Museum of Jewish Heritage, are thoroughly unimaginative works in the new style. But others, starting with the overhaul of the Central Park Zoo in the 1980s, were decidedly more successful. Perhaps his ﬁnest example in this latter style is the Met’s Petrie European Sculpture Court, a pink-and-pearl reenactment of

carved and gilded wood from Spain. Along the way, walls are covered with pierced windows of wood or stone known as jalis leading to a small central courtyard enlivened by a purling fountain, marble ﬂoors and walls arrayed in dazzlingly abstract patterns in terracotta. As with Petrie Court, the space seems, for the most part, to be powerfully authentic. I could well have imagined it to be, were it not for the fact that some months ago, on a hard-hat tour, I saw with my own eyes a pair of artisans from the Middle East laboring to conjure up this vision in time for the opening. TRD

Q&A

The 0.03 percent

Super luxury sales are “on ﬁre,” but brokers question the depth of the market BY MELISSA DEHNCKE MCGILL he 1 percent is alive and well in Manhattan, where the luxury real estate market has generated plenty of headlines lately. With Citigroup chairman Sanford Weill’s pending $88 million sale at Central Park West and a $110 million listing at Gary Barnett’s under-construction One57, the high-end Manhattan market has been impossible to ignore. This month, The Real Deal talked to some of the city’s top brokers and market analysts to ﬁnd out what’s behind the splashy headlines. Why is the luxury market doing so well while there’s still softness in the rest of the New York City market — and the rest of the country, for that matter? Market experts described vast discrepancies within the luxury market. The high-end elite — above, say, $10 million and $20 million — is faring best. Stribling & Associates’

Elizabeth Sample

Senior Vice President, Sotheby’s International Realty News broke in December that former Citigroup Chairman Sandy Weill sold his 15 Central Park West apartment and seems to have gotten his $88 million asking price. So what’s going on with activity in the residential luxury real estate market in Manhattan? The luxury market is on fire. We’ve had some very significant townhouse and condominium sales ranging from $17 to $60 million. We have one of the most expensive apartments in New York that’s asking $60 million at 25 Columbus. We show that two to four times a week. It’s a mix of American and overseas buyers. [Luxury buyers and sellers are] quite resistant to the ups and downs in the market. Every year [since the Lehman collapse, the luxury market] has become much more active. Three years ago, there were billionaires bottom fishing, picking up all the discounted properties. Two years ago, there were a lot more foreigners coming in because of the situation in Europe. Now, everybody is basically out there because prices are going up and the supply is extremely limited. We’re still reporting on plenty of price chops on super high-end listings. What sorts of price discounts are you seeing in the Manhattan luxury market? Very little, quite frankly. If anything, I’ve had price increases on several luxury properties. I’ve had sellers turn down as much as $12,000 a square foot. Most of these people in the luxury market don’t have to sell. They are selling because they never use the apartment, or it’s one of five homes and it is too much for them to deal with. ... At One57, the new project that Gary Barnett is doing, in one month they are on their third price increase. 68 February 2012 www.TheRealDeal.com

What kinds of luxury properties are struggling the most? Condos absolutely outsell co-ops. We had a glut of Park Avenue co-ops and family apartments on the market that have come down significantly in price. A lot of those were overpriced and were snapped up recently. ... There is a niche buyer for unrenovated co-ops. Even if you find something that’s in triple-mint condition, a buyer will usually make modifications. Something that hasn’t been renovated in 40 years will be harder to sell. Buildings that have summer work rules, that is a big deterrent. At 820 Fifth Avenue, it can take three to four years for someone to renovate a 6,500square-foot home because of the summer work rules. What’s going on with financing for luxury residential properties in Manhattan? Are buyers opting to finance or are there still a lot of all-cash buyers in the market? Most of the purchasers are all cash or they have private bank relationships and they get a very good deal if they are financing, maybe 1 percent as a favor from the bank, based on all the other assets they have invested.

Deanna Kory

Senior Vice President, the Corcoran Group What’s going on with activity in the Manhattan luxury market? The market appears to be stronger relative to the middle and lower ends, which is why everyone is talking about it. What’s most signiﬁcant is that the ultra high-end is strong — I mean over $20 million. Sales price records are being broken, which is consistent with the potential sale of [Weill’s] penthouse at 15 Central Park West and the possible sale of a $110 million penthouse at One57.

Kirk Henckels noted that some sales are setting new records, with sale prices of $10,000per-square-foot or more. Yet the middle-luxury market, between $3 million and $8 million, is “a little more ﬂat,” as Brown Harris Stevens’ John Burger put it. Buyers looking to spend more than $10 million tend to be insulated from economic ﬂuctuations, explained Leonard Steinberg of Prudential Douglas Elliman. These buyers aren’t just part of the 1 percent, he said: “Chances are they’re part of the 0.03 percent.” Still, there don’t seem to be as many of these überwealthy buyers as there used to be, Henckels said, noting that the depth of the luxury Manhattan market is not what it was at the market’s peak. For more on how tight inventory is impacting luxury sales, the amount of time highend sellers can expect to wait before selling their apartments, and what brokers are doing to properly price units, we turn to our panel of experts. How are prices within the luxury Manhattan market holding up in comparison to the past? For the $5 million to $10 million market, depending on the property, [prices] are even with six months and a year ago, but higher than two to three years ago. I would say that higher than $10 million is faring the best in terms of absorption. The lower the price, the more the struggle. We’re still reporting on plenty of price chops on super high-end listings. What sorts of price discounts are you seeing in the Manhattan luxury market? The pricing for a trophy property is often purposefully outlandish to attract the attention of the press, public and brokers. Over time, if those sellers are at all serious, prices are being dropped. The exception is highly unusual properties, which rarely come on the market. What kinds of luxury properties are selling best right now? Top-end, new development condos are doing very well. Condo resales in top buildings are also faring well — but, again, the buildings have to be top-notch. Co-ops on the high end are selling when they have special features such as a fabulous view, great renovation or are in a special building.

Donna Olshan

President, Olshan Realty What’s going on in the Manhattan luxury market right now? Sales started to struggle in the early summer of 2011 with a perfect storm: A global financial crisis, Congress paralyzed over budget negotiations and a roller coaster stock market. The real estate market can only digest so much bad news. Nevertheless, the prices in the luxury market held up well because

of a shortage of inventory among large, good-quality units — particularly condos. The primary cause of the inventory shortage is the fact that there has hardly been any new construction since 2008. What sorts of price discounts are you seeing? At $4 million and above, prices were reduced an average of 6 percent from the original asking price before they went into contract. Which price ranges within the luxury market in Manhattan are performing best? The market between $4 to $7 million moves quicker than higher-priced properties. The median of the contracts signed in our 2011 reports was in the $7 million range. Townhouses have performed very well, with those priced below $7.5 million moving briskly. What are you seeing in terms of inventory in the luxury market? The statistics show luxury inventory with about a one-year supply. That’s a significant improvement from several years ago, when we had a two-year supply. Are most luxury buyers opting to finance their deals, or are there still a lot of all-cash buyers? Many of the deals are cash. One reason is foreign buyers prefer to pay in cash. But many domestic buyers still like to finance. With mortgage rates as low as they’ve ever been, it makes sense to get financing, even if it means jumping through hoops. What is the most worrying trend that you’re seeing right now in the Manhattan luxury market? Condos trying to act like co-ops, with vast amounts of application paperwork. It defeats the purpose of a condo.

Q&A

John Burger

Managing Director, Brown Harris Stevens What’s going on with activity in the residential luxury market? We are in the middle of a market that is generally stable. It’s healthier at the very premium end of the market, and a little more flat in the middle-luxury market, which I define as $3 to $8 million. ... Buyers are very well aware through the Internet when the inventory has become stale. The broker websites don’t discuss the longevity of a listing, but the general consumer websites, such as StreetEasy and Trulia, do discuss listing dates. If buyers see that a listing is stale and has sat for a long time at a given price, they consider that confirmation that the listing is overpriced. What’s happening with average prices within the luxury Manhattan market? I’d say the luxury market dropped by as much as 20 to 25 percent in the post-Lehman collapse. Now, I think that we are probably off by 5 to 10 percent. In general, we are very close to where we were at the peak of the market. But I don’t think we are quite there yet. What sort of price discounts are you seeing? If a listing is priced [responsibly], using three comparables that sold in the past six months, it should sell at the [original] price. But if it’s priced based on the assumption that there will be some impulse buyer that absolutely must have that south terrace, then there is no telling the percentages of adjustments. Are sellers being more realistic with their pricing these days? It often depends on the motivating factor behind a sale. Some people have their property on the market and have not yet found another property. A buyer’s broker should always ask the listing broker what the motivation is for the sale. Is it relocation? Is it a move to the suburbs, a change in marital status? The motivation for the sale tends to play a big part in determining what the negotiability of the price is. What kinds of luxury properties are selling best, and which are struggling most? The property category that sells the best and the quickest are turn-key, high-end condos in mint, move-in condition. The category of the market that sells the slowest are prewar co-ops in poor condition that have limited light and limited exposure. Are there still distressed sellers in the luxury market? For the most part, they have worked through the system. Occasionally, you have sellers who are anxious because they have

doubled-up: They have purchased their next apartment, but they haven’t sold the previous apartment. Those sellers are increasingly anxious about the timing. My advice to clients is not to double-up. Get the sale done ﬁrst and if necessary choose a temporary rental because you will always have one or two good opportunities in any given seasonal market to acquire another apartment.

Kirk Henckels

Executive Vice President/Director, Stribling & Associates What’s going on in the luxury market? I divide the luxury market into $5 to $10 million, $10 to $20 million and $20 million and over. In the $20-andover category, we have seen some remarkable trophy sales. They can be very difficult to price, because these people have more money than they know what to do with and it’s now socially acceptable to spend it. ... There is trophy inventory on the market that has been there forever and has devalued itself. If it came on now, I suspect it would sell and would sell at a higher price, but it’s a little late for that. What’s keeping those trophy properties from selling? The amount of work needed. They may have flaws. ...The quality sells at top dollar very quickly, other things don’t. There are issues like summer work rules in the co-ops or it might not be on a high floor. What kinds of prices are you seeing? Price-per-square-foot is way above where it used to be. We are seeing $10,000 a square foot for the really top-of-the-market. We have never seen that before. However, the depth of this market is not the depth that it was at the peak. I would say the trophy buyers are as strong, but there don’t seem to be as many of them because we don’t have as many of the hedge fund people as we did before, and it’s more of a global market than ever. ... The super rich want to be in the same places as their friends — London, Zurich and the Riviera. New York is starting to be included in that as the Russians become more comfortable with putting this kind of money here. The U.S. is much more restrictive about tracking money than London or other places, so it’s taken them a while to become comfortable. Multiply that by 100 when talking about the Chinese. ... The Chinese are buying $1.2 million apartments for their kids near Columbia or NYU, but they are not dropping $20 million on an apartment for themselves yet; that will take time. What sorts of price discounts are you seeing right now in the luxury market?

The problem is it’s all over the map. You have one — actually two — that sold for 50 percent less than their [original] asking prices, and then you have a 15 Central Park West where there was no discount at all. How do you analyze that? These discounts are so tied to a speciﬁc set of circumstances. How do you price a luxury property in this market? If you price off of comps, you might end up seriously underpricing. Our theory is that the property is going to take itself to its own market level unless it’s a property that very few people would want. ... Or you price by your gut. Clearly, Sandy Weill priced off Will Zeckendorf, and he was right.

Jonathan Miller

President, Miller Samuel What does the Weill sale say about the luxury real estate market in Manhattan? Actually, I see this sale as a one-off transaction, or an outlier that has little or anything to do with the state of the Manhattan luxury market. It sold for more than 30 percent above the previous record in the same building. The luxury market is perhaps the most nonhomogenous segment of the market, since the properties tend to be more unique and therefore harder to extract a price trend from. What are prices like in the high-end market and how is the luxury market faring in relation to the overall Manhattan market? A year-over-year comparison in median price for luxury sales showed a decline of 4.6 percent to $4.15 million in the fourth quarter of 2011, down from $4.35 million in the same quarter of 2010. ... The upper end of the luxury market — those units at $10 million and over — is out-performing the balance of the luxury market. Things are generally better at the top. How long are luxury properties staying on the market now, on average, and how does that differ from the last few years? The average days-on-market for a luxury property was 189 days in 2009, 154 days in 2010 and 145 days in 2011. The high-end rental market has been outperforming expectations. Is it taking buyers from the sales market? There’s been an odd parallel [that] has been playing out for the past year. Both markets ... have expanded because supply has expanded. Luxury sellers who bought at the peak began to offer their properties for rent last year. Potential buyers who were on the fence were exposed to a better quality [rental] product, and chose to rent over buying. But even with that competition,

[the luxury sales market] is performing better than the balance of the market. What is the most surprising trend in the luxury market right now? The concentration of trophy sales was quite surprising: nine sales at or above $30 million in 2011, three sales at or above $40 million and, of course, the $88 million, $13,000-per-foot penthouse at 15 CPW. What is the most worrisome trend for the luxury market? The reliance on the weak U.S. dollar to generate sales, especially for high-end new development. Since many European countries just had their credit rating downgraded, we very well could see a scenario where the dollar gets stronger relative to the euro in 2012, which could temper the pace of foreign buyers who are currently getting a discount for buying here.

Leonard Steinberg

Managing Director, Prudential Douglas Elliman How is sales volume doing in the Manhattan luxury market? People who buy $50 million apartments are not part of the 1 percent — chances are they are part of the 0.03 percent. And there is always a market for the very, very best, just as there is in the collector-car market and the art market. What sorts of price discounts are you seeing in the Manhattan luxury market? Too many high-end listings have been overpriced by overzealous brokers or their misguided clients, and deserve price chops. Realistic sellers are rewarded by having their properties sold. What are you seeing in terms of inventory right now? There is a shortage of quality, large apartments. The luxury buyer willing to pay premium dollars right now wants it all — not just the Picasso, but the best Picasso. How long are Manhattan luxury properties staying on the market now? I don’t rely on a property selling faster than about six months. ... But the pace has picked up since two and three years ago. What’s the most worrying trend you’re seeing right now in the market? Sameness, gimmicks and lack of charm and character are a worrying trend where so many new buildings feel like last month’s boutique hotel-of-the-month: The luxury market needs more product that is unique, special and substantially luxurious. Getting this right produces not only happy luxury buyers, but also bigger proﬁts. TRD www.TheRealDeal.com February 2012 69

Tri-state briefs NEW JERSEY

“Jersey Shore” house most viewed in 2011 Zillow last month released a list of the Top 10 Most Viewed Homes on its site for 2011. Topping the list was the “Jersey Shore” house — a sixbedroom home in Seaside Heights that famously hosted the hard-partying cast of the popular MTV reality show. The 1209 Ocean Terrace home, which rents for $6,500 per night in the summer, beat out even the White House: 1600 Pennsylvania Avenue placed eighth on

was brieﬂy listed for sale in 2010 for $4.1 million. Also in the Top 10: Rapper 50 Cent’s home in Farmington, Conn., and the Woolworth Mansion on 80th Street in Manhattan, which is currently listed for The “Jersey Shore” house in Seaside Heights sale at $90 million. Zillow’s list. Another high-ranking New Jersey is also faring well when New Jersey property was the Mont- it comes to commercial real estate. ville mansion of “Real Housewives” The state’s Class A ofﬁce space poststar Melissa Gorga, which came in ed its lowest vacancy and highest at No. 7. The custom-built home net absorption rates since before

the economic meltdown, according to Jones Lang LaSalle’s fourth-quarter market report. Class A vacancy fell for the third straight quarter to 23.3 percent, the lowest level since mid-2008, while net absorption for the year totaled more than 1.5 million square feet, the highest yearly total since 2007. Submarkets experiencing strong leasing activity in the fourth quarter included the Parkway Corridor, Route 78 and Central Bergen County, the report said. Asking rents throughout the state averaged $23.85 per square foot, up slightly from the third quarter.

CONNECTICUT

Eastern CT home prices lowest in a decade The median home price in Eastern Connecticut dropped below $200,000 for the ﬁrst time in nearly a decade, the New London Day reported. According to statistics released last month by the Eastern Connecticut Association of Realtors, the 2011 median single-family home price in Windham and New London counties was just $192,000, down from $210,000 the year before and the lowest since 2003’s median of $174,000. Meanwhile, sales of homes priced over $350,000 saw a sharp decrease, according to Eastern Connecticut Association of Realtors CEO John Bolduc, who told the Day that “2011 was a difﬁcult year.” He added: “I think we still have maybe another year of foreclosure and short-sale issues.” WESTCHESTER COUNTY

Downtown New Rochelle to get revamp The Albanese Organization, a Long Island-based real estate ﬁrm, has proposed an ambitious redevelopment plan that could transform downtown New Rochelle, the Journal News reported. Albanese presented its plan to the New Rochelle city council last month, proposing to build 550 new residential units, 25,000 square feet of retail space and 1,200 new parking spaces on a pair of cityowned parking lots. The ﬁrst phase of the project would include an eight-story, 106-unit apartment building with a parking garage. New Rochelle Mayor Noam Bramson has already expressed

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70 February 2012 www.TheRealDeal.com

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National market report

Commercial and residential real estate news briefs from around the U.S.

350 West Mart Center in Chicago

Chicago Shorenstein Properties paid $292 million last month to purchase Chicago’s 350 West Mart Center from Vornado Realty Trust, the Wall Street Journal reported. One of the nation’s largest commercial owners, Shorenstein Properties plans to put its Chicago headquarters in the recently purchased building, located in the city’s River North area. Currently 85 percent occupied, 350 West Mart houses retailers, wholesalers and some office tenants. In the next five years, Shorenstein will spend around $20 million to convert the building entirely to office space, according to Charlie Malet, Shorenstein’s executive vice president of investments. The purchase marks a return to the Chicago market for Shorenstein, which sold its last Windy City property five years ago. “We’re seeing good demand in cities like Chicago that have good public transportation and housing downtown,” said Malet. Late last year, the overall vacancy rate for office space in Chicago’s central business district market was 14.4 percent, down from 15.3 percent the previous year, according to Transwestern’s year-end market report.

Seattle Home prices in the Seattle area continue to tumble, the Seattle Times reported. Short sales accounted for more than a third of December home sales in Kings County, where Seattle is located, according to data from the Northwest Multiple Listing Service. The median home price in the area was $320,000 in December, down 13.5 percent from the same month of 2010. Condo prices, meanwhile, tumbled 18 percent year-over-year. Sales volume rose, however, likely due to the number of low-priced, distressed properties on the market. The number of single-family homes sold in December inched up 0.5 percent from the previous year, while the number of condo sales grew 20 percent. Lower prices are expected 72 February 2012 www.TheRealDeal.com

to keep sales volumes on the increase for much of 2012, the Times said. Distressed property sales “are having a huge drag on what I refer to as ‘real-people sales,’ ” said Tony Hettler, owner of the local residential brokerage John L. Scott Real Estate.

consists of two separate houses, a pool and a tennis court. The top ﬂoor of the beachfront mansion was designed for Pitt and Jolie by environmentally conscious architect Christopher Sorensen. What could drag the Brad Pitt and Angelina Jolie

Atlanta The Peachtree Data Center in downtown Atlanta sold for $94.75 million last month, CoStar News reported. A partnership led by Carter Validus Mission Critical Real Estate Investment Trust purchased the sixstory, 290,000-square-foot facility from owner Peachtree Carnegie LLC. Located at 180 Peachtree Street, the complex sits on three acres and includes two parking garages. Carter Validus will oversee operations at the building, which underwent a $230 million renovation in 2010. The data center houses off-site data storage facilities for three Fortune 500 companies, among other tenants, according to the REIT.

Los Angeles Hollywood power couple Brad Pitt and Angelina Jolie sold their Malibu home in December for $12 million to Ellen DeGeneres and her wife, Portia de Rossi, according to People magazine. The 4,100-square-foot spread, which overlooks the Paciﬁc Ocean, The Jolie-Pitt home

Bay Area. The properties were 82 percent leased as of December 2011, according to Deutsche. The bank has recently put several of its global asset management businesses, including RREEF, up for sale in light of “new regulation, rising costs and growing competition,” Reuters reported.

San Antonio

glamorous Jolie-Pitts away from all this? According to the Daily Mail, Jolie recently surprised Pitt by purchasing him a waterfall near L.A. Pitt, an architecture buff, is planning to build an ambitious house over the falls in the style of Frank Lloyd Wright’s Fallingwater. Pitt and Jolie also own homes in Hollywood, New Orleans, the Valpolicella region of Northern Italy and the South of France. DeGeneres and De Rossi, meanwhile, put their 12,000-square-foot Beverly Hills home on the market this fall for $49 million.

San Francisco RREEF Real Estate, the real estate investment management arm of Deutsche Asset Management, sold its Northern California portfolio of industrial buildings in December for an aggregate price of $520 million, according to Reuters. PS Business Parks, a public real estate investment trust based in Glendale, Calif., was the purchaser. PSB also assumed $250 million of debt in the transaction. The portfolio consists of over 5.3 million square feet of warehouse and “ﬂex” space properties in the San Francisco

Oil money and wealthy purchasers from Mexico are invigorating the San Antonio luxury residential market, the Houston Chronicle reported. The median San Antonio home price between January and November of 2011 was $152,000, up from $149,800 in the same 11-month period of 2010, according to data released last month by the San Antonio Board of Realtors. The number of home sales through November 2011 — 16,516 — was nearly identical to the same period of 2010. But prices for luxury homes have fared better than the market as a whole, brokers said. Jason Glast of Keller Williams Luxury International said homes priced above $750,000 have risen about 3.3 percent year-over-year, compared to roughly 2 percent for the market at large. The volume of luxury home building is also improving, though it has not yet reached pre-recession levels. That presents a stark contrast to 2008, when the area’s luxury market was hit hard by AT&T’s move from San Antonio to Dallas, prompting a flood of “executive level” homes on the market. But recently, drilling in the local Eagle Ford Shale and an influx of Mexican money have turned things around. “All of these people who find themselves with a lot of money don’t want to put it all the in the bank and in stocks,” Glast said. “The most expensive stuff sells first,” said Charlie Hill, vice president of Cordillera Ranch Development Corp., which develops property near San Antonio. “It’s staggering. The bigger challenge for us is going to be to get the builders going quickly enough.” Compiled by Guelda Voien

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On the market

Commercial properties recently placed on the market

Jersey City commercial buildings for sale

Coney Island development site on the market

Three contiguous commercial properties at 33 Journal Square and 912-920 and 922-924 Bergen Avenue in Jersey City are on the market with a combined asking price of $20 million. Located in the Journal Square neighborhood, the buildings include about 60,000 square feet of space and occupy an entire block front. National retail tenants such as Bally Total Fitness, 7-Eleven, Radio Shack and Popeyes lease space at the properties. David Schechtman, Paul Nigido and Gary Meese of Eastern Consolidated are handling the sale.

A 71,139-square-foot parcel at 2957 Shell Road in Coney Island is on the market with an asking price of $17.5 million. The property, which has frontage on three streets — Shell Road, Neptune Avenue and West 6th Street — is located in the Ocean Parkway Special District and is zoned for a variety of uses, including residential, commercial and community facilities. The site’s total buildable square footage ranges from 173,000 for as-of-right residential to more than 300,000 for community facilities. Ben Weiss and Kelly Lin of Besen & Associates are handling the sale.

Brooklyn multifamily portfolio on the block A package of six apartment buildings in Brooklyn — two in Williamsburg and four in Sunset Park — is for sale with an asking price of $19 million. The properties have a combined 121 residential units and four commercial units. The two Williamsburg buildings are located at 117-119 South 4th Street and 189-191 South 9th Street and consist of 61 apartments. The remaining four buildings, located in Sunset Park, include 4706-4712 Fourth Avenue and 881-887 Fifth Avenue, which are comprised of 32 apartments, and two adjoining buildings at 881-887 Fifth Avenue, which have 28 apartments. Massey Knakal’s Mark Lively is mar117 South 4th Street keting the portfolio.

74 February 2012 www.TheRealDeal.com

UES commercial townhouse for sale A five-story townhouse at 16 East 65th Street is on the market with an asking price of $16 million. The 6,805-square-foot property, located between Fifth and Madison avenues, was recently renovated for medical and office use. The building has private terraces on floors two and four 16 East 65th Street and high-end finishes throughout. According to the listing, the property is ideal for use by a medical or office tenant, a gallery or an embassy, or for conversion to a single-family home. Guthrie Garvin of Massey Knakal is handling the assignment.

East Village apartment building on the block A six-story, multifamily property at 619 East 5th Street is

on the market with an asking price of $12.23 million. The 25,200square-foot walk-up is located between Avenue B and Avenue C, and is adjacent to a playground and community garden. Among the 40 fully occupied residential units are 27 market-rate apartments and 13 619 East 5th Street rent-stabilized apartments. There are 16 studios, four one-bedrooms, 11 two-bedrooms, seven three-bedrooms and two three-bedroom duplexes. Michael DeCheser and Darragh Clarke of Massey Knakal are marketing the property.

Retail building near Columbia’s Manhattanville campus hits market A free-standing retail building near Columbia University’s developing Manhattanville campus is on the market for $11 701 West 135th Street million, according to Eastern Consolidated, the exclusive listing agent for the property. The 18,200-square-foot rectangular building at 701 West 135th Street yields more than $400,000 in annual income from current leases, according to the listing, with one retail suite still vacant. The two in-place leases also each contain terms to provide for vacant delivery by summer 2012. Eastern Consolidated’s Marion Jones and David Schechtman are handling the sale. Compiled by Linden Lim

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Deal Sheet summary

The Deal Sheet, on pages 78 to 86, covers transactions from 12/11/11 through 1/10/12. Please submit future deals to deals@therealdeal.com.

Sales

Overview

By type

Property sales Dollars

Development

95.57

Hotel

465.7

Industrial

31.88

Mixed-Use

19.75

Multi-family

599.7

Development

Deals

44 $2,193,350,000

Financing

By dollar volume (in millions)

Mixed-Use Multi-family

Transactions

Office

862.5

Buildings

Retail

118.25

Aggregate value

$893,800,000

Leases Office

Retail

Total

126

Leases square feet Office

993,094

Retail

153,622

Total

1,146,716

Office leases Office leases by industry Industry

Office leases sf by industry Leases

Industry

Advertising & Marketing

Animation

Architecture & Design

Consulting

Top tenant reps for office leasing by sf

Square feet leased

Tenant representative

Square feet leased

18,053

Newmark Knight Frank

255,300

Animation

17,500

Cassidy Turley

186,000

Architecture & Design

13,553

The CBRE Group

104,702

Consulting

77,896

Jones Lang LaSalle

82,459

Education

52,341

Adams & Co.

78,872

Entertainment

910

Grubb & Ellis

55,673

Fashion*

166,855

Financial

410,284

Fine Arts

3,373

Medical

NGO

Other

125,642

Cushman & Wakefield

54,792

Studley

52,937

VIZA Group

21,339

15,810

Winslow & Co.

15,000

35,420

NAI Global

7,998

Capstone Realty Advisors

5,350

Production

15,764

Real Estate

13,620

Science & Technology

19,098

Textiles

6,975

Retail leases Top tenant reps for leasing by sf

Retail leases by industry

Broker

Square feet leased

Eyewear

1,400

Andrew A. Pittel & Co.

33,000

Fashion

40,154

Ripco Real Estate

24,035

Financial Services

2,200

Winick Realty

18,832

Food & Beverage

57,801

A.C. Lawrence

10,000

Health & Beauty

23,853

Other

28,214

Reilly Real Estate

8,400

Kassin Sabbagh Realty

6,650

Newmark Knight Frank

6,600

NAI Friedland Realty

6,470

Grubb & Ellis

4,545

NYCRS

3,500

Sholom & Zuckerbrot

2,943

M.C. Oâ&#x20AC;&#x2122;Brien

2,519

Rescom Properties

2,200

00 May 2www.TheRealDeal.com (*includes showroom space)

Other

Retail leases sf by industry

www.www.TheRealDeal.com February 2012 77

Deal Sheet

Commercial deals in New York City Deals are listed from largest to smallest in square feet leased or bought. The Deal Sheet covers transactions from 12/11/11 to 1/10/12. Please submit future deals to deals@therealdeal.com.

Office leases Address

Size

Tenant / Representative

Landlord / Representative

Notes

330 Madison Ave

186,000

Guggenheim Partners / Peter Hennessy, Cassidy Turley

Vornado / Frank Doyle, Jones Lang LaSalle

The investment firm signed a 15-year lease for space on floors eight, 10, 11, 15, 18 and 32, the New York Observer reported. The tenant will relocate to the new space next year, when its current lease at 135 East 57th Street expires.

22 Cortlandt St

126,000

Municipal Credit Union / S. Sehosel, B. Rosner, Newmark Knight Frank

Mayore Estates LLC / Barrett Stern, Grubb & Ellis

The financial services firm signed a 15-year lease renewal.

450 West 15th St

75,000

inVentiv Health / P. Meyers, M. Movshovich, CBRE

Stellar Management / M. Dreizen, J. Kuhn, B. Waterman, Newmark Knight Frank

The healthcare consulting firm signed a long-term lease renewal and expansion.

1440 Broadway

67,000

Liz Claiborne / D. Falk, J. Greenstein, Newmark Knight Frank

Monday Properties / Represented inhouse

The fashion company signed a lease renewal on the third and fourth floors, the New York Post reported. The asking rent was in the mid-$50s per square foot, according to the Post.

4 MetroTech Center (Brooklyn)

50,000

Deutsche Bank AG / K. Siegel, P. Riguardi, Jones Lang LaSalle

JPMorgan Chase / S. Cahaly, J. Wheeler, Jones Lang LaSalle

The bank signed a lease for its first Downtown Brooklyn office, the New York Observer reported.

140 William St

49,200

Pace University / D. Falk, K. Ciminelli, Newmark Knight Frank

Crikos LLC / P. Braus, J. Wacht, G. Isaacs, P. Levitan, G. Steinberg, Lee & Associates

The university signed a 21-year lease for classrooms, faculty offices and performance space.

485 Lexington Ave

42,842

The Leading Hotels of the World Ltd. / D. Horowitz, J. Peck, Studley

SL Green / Represented in-house

The luxury hospitality organization signed a long-term lease on the fourth floor. The company is relocating from 99 Park Avenue.

15 MetroTech Center (Brooklyn)

35,145

New Jersey Nets / Bruce Mosler, C&W

Visiting Nurse Health Care System Inc. / Glenn Markman, C&W

The professional basketball team signed a sublease for its new corporate headquarters, the New York Observer reported. The team is relocating from East Rutherford, N. J.

360 Lexington Ave

30,420

The Alzheimer’s Association / David Kaplansky, Jones Lang LaSalle

AEW / Wendy Miller, Cassidy Turley

The nonprofit signed a 15-year lease renewal and expansion, the New York Post reported.

501 Seventh Ave

29,702

Carolina Herrera / Matthew McBride, CBRE

W&H Properties / L. Smith, G. Kamenetsky, CBRE

The fashion designer signed a 15-year expansion lease, the New York Post reported.

485 Lexington Ave

27,996

Fidelity National Title Insurance Co. / n/a

SL Green / n/a

The title insurance company signed a lease on the entire 18th floor, the New York Post reported.

463 Seventh Ave

23,785

Consolidated Children’s Apparel / Joseph Friedman, Adams & Co.

The Arsenal Company LLC / David Levy, Adams & Co.

The children’s apparel and accessory company signed a seven-year lease. The reported asking rent was $32 per square foot.

100 Wall St

19,647

James W. Giddens, Trustee for the SIPA Liquidation of Lehman Brothers Inc. / Gus Field, C&W

Savanna / M. Konsker, S. Cahaly, B. Reiver, Jones Lang LaSalle

The tenant signed a lease renewal. James Giddens was selected by the Securities Investor Protection Corp. and appointed by the U.S. District Court for the Southern District of New York to handle the liquidation of Lehman Brothers Inc. in 2008.

129 West 27th St

15,000

Titmouse / Joshua Winslow, Winslow & Co.

Kaos Studios / T. Wisinski, D. Starr, A. Lindsey, UGL Services

The digital animation firm signed a short-term sublease on the seventh and eighth floors.

261 Fifth Ave

14,047

Tumi Inc. / Represented in-house

n/a / B. Feil, R. Briskin, The Feil Organization

The luxury travel accessories company signed an expansion lease for its corporate offices and showroom.

386 Park Ave South

13,100

HFP Capital Markets LLC / J. Moran, H. Brodsky, N. Goldmacher, Newmark Knight Frank

Savanna; Monday Properties / n/a

The investment bank signed a 15-year lease for the entire eighth floor. The tenant will initially occupy an 8,500-square-foot, prebuilt suite on the eighth floor, and has agreed to expand to the entire eighth floor in a few years.

225 Varick St

12,978

Optomen Productions / R. Yaffa, W. Van Aken, Grubb & Ellis

Trinity Church / n/a

The production company signed a 10-year lease.

250 Park Ave South

11,636

Tudor Realty Services Corp. / Represented in-house

The Feil Organization / Represented in-house

The real estate company signed a lease renewal on the entire fourth floor.

120 West 45th St

10,750

Perimeter Internetworking Corp. / Barry Lewen, Grubb & Ellis

Pzena Investment Management LLC / n/a

The e-security and technology firm signed a four-year sublease.

10 Hudson Square

10,095

Relevent / Daniel Horowitz, Studley

Trinity Real Estate / Represented inhouse

The experiential marketing agency signed a lease for space on the top floor. The tenant is relocating from 27 West 24th Street.

475 Park Ave

7,998

Atari / H. Goodfriend, T. Dickey, NAI Global

Cohen Brothers Realty / Marc Horowitz, Cohen Brothers Realty

The gaming company signed a new lease on the seventh floor. The firm is relocating from a larger, 35,000-square-foot space at 417 Fifth Avenue.

231 West 39th St

6,138

Autumn Cashmere / James Buslik, Jeffrey Buslik, Adams & Co.

n/a / James Buslik, Jeffrey Buslik, Adams & Co.

The apparel manufacturer signed a nine-year expansion lease. The reported asking rent was $35 per square foot.

390 Broadway

6,000

Studio Case LLC / M. Mandel, B. Lewen, M. Plavin, Grubb & Ellis

Nazwin Associates / n/a

The advertising and design firm signed a 10-year lease.

231 West 39th St

5,700

Shoshanna Collection / James Buslik, Jeffrey Buslik, Adams & Co.

n/a / James Buslik, Jeffrey Buslik, Adams & Co.

The apparel wholesaler signed a lease renewal and expansion. The reported asking rent was $35 per square foot.

355 Lexington Ave

5,500

Touchstorm LLC / H. Rose, J. Cannon, Grubb & Ellis

Godiva Chocolatier Inc. / J. Wechsler, H. Grufferman, M. Gottlieb, Grubb & Ellis

The digital media firm signed a two-and-a-half-year lease.

15 West 37th St

5,350

Dasilva Architects / R. Thomas Murtha, Capstone Realty Advisors

n/a / Steven Levy, Kamber Management

The architectural firm signed a long-term lease for the entire 16th-floor penthouse.

1001 Sixth Ave

5,173

Strategic Products & Services / Ira Rovitz, Grubb & Ellis

1001 Sixth Avenue Associates / n/a

The technology firm signed a five-year lease.

37-39 West 28th St

5,000

Pencils of Promise / R. Yaffa, W. Van Aken, Grubb & Ellis

Rexton Realty Company / n/a

The nonprofit signed a three-year lease.

10 West 33rd St

4,619

You and Me Legwear LLC / David Levy, Adams & Co.

n/a / David Levy, Adams & Co.

The hosiery company signed a five-year lease renewal. The reported asking rent was $39 per square foot.

875 Third Ave

4,348

Symphony Capital LLC / Barry Lewen, Grubb & Ellis

Elan Pharmaceuticals Inc. / n/a

The investment firm signed a sublease extension.

419 Park Ave South

4,100

Kips Bay Gynecology / Max Vizgalin, VIZA Group

Walter & Samuels / Gregory Postyn, Walter & Samuels

The gynecologist inked a 15-year lease. The reported asking rent was $40 per square foot.

78 February 2012 www.TheRealDeal.com

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Michael Scavelli 347-574-0018 michael.scavelli@citi.com NMLS ID 721719

Amy Blackwood 917-224-9206 amarilis.blackwood@citi.com NMLS ID 726463

* Important Conditions: For Citibank jumbo first mortgage loan applications registered through March 31, 2012. Loans originated between January 1, 2012 and March 31, 2012 are restricted to non conforming loans. To be eligible for this program, borrowers must at the time of origination 1) have or open a Citibank deposit account and 2) set up mortgage payments for a direct debit from a deposit account. Eligibility in the program will be determined at application for a first mortgage loan on a specific property with the Mortgage Consultant. Offer applies to new home purchase applications and new refinance applications only. Offer not applicable for Home Equity Loans or Lines of Credit. Certain conditions apply: (i) The Rate Protection option may only be exercised (a) after the first monthly payment due date as specified in the Note and (b) before the third anniversary of the date reflected on the Note; (ii) The “Rate Protection Conversion Index,” which is based on the Citibank par rate, must fall more than one quarter of one percentage point (0.25) from the Rate Protection Conversion Index in effect as of the date the Note rate was locked; (iii) Citibank must be notified to exercise the Rate Protection Option and will confirm eligibility; (iv) the Mortgage cannot be in default under the terms of the Note or the Security Instrument; (v) The borrower must provide or complete any documents Citibank requires to effect the new interest rate, including, but not limited to a Loan Modification Agreement. ** The offer cannot be used to obtain cash from the transaction. Offer available on purchase transactions only, not refinance. This is a limited time offer. Citibank Mortgage reserves the right to suspend, change and terminate the offer and promotion. Customer must apply and lock in rate by the offer end date to qualify. The terms, conditions, and fees of accounts, programs, products, and services are subject to change. This is not a commitment to lend. All loans are subject to credit and property approval. ©2012 Citibank. Citibank, N.A. Member FDIC. Citibank and Citibank with Arc Design are registered service marks of Citigroup Inc.

Office leases continued Address

Size

Tenant / Representative

Landlord / Representative

Notes

250 West 40th St

4,000

Manhattan Graphics / Joseph Friedman, Adams & Co.

n/a / Morris Franco, BMS Realty

The graphic design firm signed a five-year lease. The reported asking rent was $25 per square foot.

62 William St

4,000

Executive Placement Network / Ilya Tsitron, VIZA Group

BMS Realty Associates / M. Franco, S. Franco, BMS Realty Associates

The executive placement company signed a six-year lease for the entire second floor.

20 Broad St

3,586

MGRM Holding Inc. / Ira Rovitz, Grubb & Ellis

20 Broad Street Company LLC / n/a

The healthcare services firm signed a five-year lease.

1411 Broadway

3,200

Salmons & Brown / Joseph Friedman, Adams & Co.

n/a / Anthony Dattoma, CBRE

The fashion company signed a two-year lease. The reported asking rent was $40 per square foot.

20 Jay St (Brooklyn)

3,141

Explore Schools Inc. / n/a

Two Trees Management / Caroline Pardo, Two Trees

The charter school operator signed a lease.

20 Jay St (Brooklyn)

3,030

Marble Fairbanks Architects / n/a

Two Trees Management / Caroline Pardo, Two Trees

The architectural firm signed a lease.

110 West 40th St

2,896

Pyramid Consulting Group / J. Buslik, S. Goodman, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The consulting firm signed an eight-year lease. The reported asking rent was $42 per square foot.

20 Jay St (Brooklyn)

2,500

SeedNY Inc. / n/a

Two Trees Management / Elizabeth Bueno, Two Trees

The animation company signed a lease.

20 Jay St (Brooklyn)

2,460

By Boe Ltd. / n/a

Two Trees Management / Elizabeth Bueno, Two Trees

The jewelry wholesaler signed a lease.

347 West 36th St

2,350

Pono Accessories / Joseph Friedman, Adams & Co.

n/a / B. Bernstein, H. Epstein, Winoker Realty

The fashion accessories firm signed a five-year lease. The reported asking rent was $28 per square foot.

210 11th Ave

2,338

Third Generation Art LLC / S. Siegel, D. Cekolis, Grubb & Ellis

Onbar LLC / n/a

The art gallery signed a five-year lease.

20 Jay St (Brooklyn)

2,257

Berghahn Books Inc. / n/a

Two Trees Management / Elizabeth Bueno, Two Trees

The publisher of academic books signed a lease.

352 Seventh Ave

2,200

Zoya Simakhodskaya / Joseph Friedman, Adams & Co.

n/a / Nathan Wasserman, AM Properties

The psychologist signed a 10-year lease. The reported asking rent was $36 per square foot.

1410 Broadway

2,100

Gemtex Apparel / Joseph Friedman, Adams & Co.

n/a / JP Howard, Murray Hill Properties

The apparel company signed a five-year lease. The reported asking rent was $40 per square foot.

250 West 57th St

2,039

Xerox Corporation / B. Pickrell, D. Neye, A. Deaton, Jones Lang LaSalle

W&H Properties / M. Arkin, H. Klein, H. Blair, S. Kearns, C&W

The business technology firm signed a new lease.

34 West 33rd St

1,981

Thread Showroom / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The textile company signed a five-year lease. The reported asking rent was $39 per square foot.

231 West 39th St

1,779

810 Showroom / James Buslik, Jeffrey Buslik, Adams & Co.

n/a / James Buslik, Jeffrey Buslik, Adams & Co.

The fashion showroom signed a five-year lease renewal. The reported asking rent was $35 per square foot.

20 Jay St (Brooklyn)

1,641

Ny-Lon USA Inc. / n/a

Two Trees Management / Elizabeth Bueno, Two Trees

The home furnishings design company signed a lease.

80 February 2012 www.TheRealDeal.com

Office leases continued Address

Size

Tenant / Representative

Landlord / Representative

Notes

150 Broadway

1,630

Dr. Louis Peterson / Max Vizgalin, VIZA Group

JEMB Realty / C. Suarez, F. Cento, J. Fein, C&W

The chiropractor inked a seven-year lease. The reported asking rent was $34 per square foot.

420 Madison Ave

1,575

Dr. Victoria Zubkina / Uriel Gandelman, VIZA Group

Lee Tai Enterprises USA Ltd. / Pat Agoglia, Lee Tai Enterprises USA Ltd.

The dentist inked an 11-year lease. The reported asking rent was $50 per square foot.

110 West 40th St

1,488

Nancy Coffey Literary & Media Representation Inc. / Michael Hymowitz, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The literary and media agency signed a five-year lease. The reported asking rent was $36 per square foot.

20 Jay St (Brooklyn)

1,486

Frank Collective Inc. / n/a

Two Trees Management / Elizabeth Bueno, Two Trees

The production firm signed a lease.

231 West 39th St

1,464

Wooden Ships of Hoboken Inc. / James Buslik, Jeffrey Buslik, Adams & Co.

n/a / James Buslik, Jeffrey Buslik, Adams & Co.

The clothing manufacturer signed a six-year lease renewal. The reported asking rent was $35 per square foot.

110 West 40th St

1,434

Environmental Capital LLC / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The municipal finance firm signed a five-year lease renewal. The reported asking rent was $42 per square foot.

110 West 40th St

1,350

Traejean Corporation / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The fashion company signed a three-year lease renewal. The reported asking rent was $42 per square foot.

336 West 37th St

1,300

Sweet Sadie / Marie Hammoudi, VIZA Group

IGS Realty / Philippe Ifrah, IGS Realty

The production company inked a lease.

115 Broadway

1,258

Dr. Edward Fruitman / Max Vizgalin, VIZA Group

Trinity Centre / C. Suarez, A. Peretz, M. Nahmias, C&W

The psychiatrist inked a 10-year lease. The reported asking rent was $37 per square foot.

110 West 40th St

1,244

Loyal Light International / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The novelty yarn company signed a five-year lease. The reported asking rent was $39 per square foot.

20 Jay St (Brooklyn)

1,136

Tekked LLC / n/a

Two Trees Management / Elizabeth Bueno, Two Trees

The software company signed a lease.

125 Maiden Lane

1,057

Omnimarkets / Uriel Gandelman, VIZA Group

125 Maiden Equities / Nadja Galloway, Time Equities

The financial services company inked a lease.

134 West 29th St

1,035

Jim Hodges Studio / Marie Hammoudi, VIZA Group

Teresharan Land Company of Manhattan / Manu Pohani, Teresharan Land Company of Manhattan

The artist signed a three-year lease.

315 Madison Ave

1,031

NOY LLC / Max Vizgalin, VIZA Group

Abramson Brothers / Billie Jean Hamel, Abramson Brothers

The wellness center inked a five-year lease. The reported asking rent was $48 per square foot.

125 Maiden Lane

1,027

IDEA Global / Max Vizgalin, VIZA Group

125 Maiden Equities / Nadja Galloway, Time Equities

The economic research company inked a lease.

10 West 33rd St

1,026

M. Fine Inc. / David Levy, Adams & Co.

n/a / David Levy, Adams & Co.

The fashion company signed a six-year lease. The reported asking rent was $42 per square foot.

110 West 40th St

1,017

Woods, Witt, Dealy & Sons Inc. / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The marketing agency signed a 10-year expansion lease. The reported asking rent was $42 per square foot.

110 West 40th St

1,002

Joremi Enterprises Inc. / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The real estate company signed a five-year lease. The reported asking rent was $42 per square foot.

165 Madison Ave

1,000

Dream Lounge / Marie Hammoudi, VIZA Group

Tamar Properties NV / Cathy Silberman, Tamar Properties NV

The designer signed an office lease.

110 West 40th St

991

Textiletone Inc. / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The textile company signed a five-year lease. The reported asking rent was $39 per square foot.

110 West 40th St

982

Able Real Estate USA / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The real estate company signed a five-year lease renewal. The reported asking rent was $44 per square foot.

10 West 33rd St

962

Intercontinental Leathern Industries / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The fashion company signed a one-year lease renewal. The reported asking rent was $42 per square foot.

57 West 57th St

912

Dr. Elvin Ruiz Hope TMS / Max Vizgalin, VIZA Group

n/a / Christel Engel, Colliers International

The psychiatrist signed a 10-year lease. The reported asking rent was $58 per square foot.

55 Washington St (Brooklyn)

910

Constellation Holdings / n/a

Two Trees Management / Elizabeth Bueno, Two Trees

The online movie theater company signed a lease.

34 West 33rd St

885

Babyfair Inc. / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The fashion company signed a three-year lease. The reported asking rent was $39 per square foot.

34 West 33rd St

748

Appaman Inc. / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The fashion company signed a five-year lease. The reported asking rent was $42 per square foot.

110 West 40th St

617

James Yarn Sales Co. Inc. / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The yarn company signed a three-year lease renewal. The reported asking rent was $39 per square foot.

110 West 40th St

584

Jovid Fabrics Inc. / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The textile company signed a two-year lease renewal. The reported asking rent was $39 per square foot.

12 West 57th St

549

Dr. Arthur Perry / Ilya Tsitron, VIZA Group

Trigon 57 / Steven Pressler, Promenade Real Estate

The plastic surgeon signed a long-term lease.

110 West 40th St

538

European Textile Trading Corporation / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The textile company signed a two-year lease renewal. The reported asking rent was $39 per square foot.

110 West 40th St

532

G2 Textiles Inc. / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The textile company signed a five-year lease. The reported asking rent was $39 per square foot.

1133 Broadway

518

Get It Sold NY / Max Vizgalin, VIZA Group

Kew Management / Represented inhouse

The online marketing firm signed a lease.

110 West 40th St

488

Gerri Tobias Inc. / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The textile company signed a two-year lease renewal. The reported asking rent was $39 per square foot.

20 Jay St (Brooklyn)

432

Auster Agency / n/a

Two Trees Management / Caroline Pardo, Two Trees

The event marketing company signed a lease.

110 West 40th St

423

Woods, Witt, Dealy & Sons / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The marketing agency signed a two-year lease renewal. The reported asking rent was $44 per square foot.

110 West 40th St

349

Shah & Pandya CPA PC / D. Levy, B. Maslin, Adams & Co.

n/a / D. Levy, B. Maslin, Adams & Co.

The accounting firm signed a three-year lease renewal. The reported asking rent was $39 per square foot.

82 Wall St

174

Nexus Expediting / Marie Hammoudi, VIZA Group

Otto Gerdau / Cassidy Turley

The expeditor for architects and engineers signed a lease.

1123 Broadway

173

Bachman Brown Design / Max Vizgalin, VIZA Group

Kew Management / Represented inhouse

The interior design company signed a five-year lease. The reported asking rent was $50 per square foot.

www www.TheRealDeal.com February 2012 81

Retail leases Address

Size

Tenant / Representative

Landlord / Representative

Notes

234 West 42nd St

25,000

Famous Dave’s BBQ / Andrew Pittel, Andrew A. Pittel & Co.

Forest City / M. Leber, J. Roseman, Newmark Knight Frank

The restaurant leased the entire former theater, the New York Post reported.

505 Fulton St (Brooklyn)

23,000

TJ Maxx / Peter Ripka, Ripco Real Estate

n/a / Peter Ripka, Ripco Real Estate

The discount fashion chain signed a lease for lower level space at the Fulton Mall in Downtown Brooklyn, the New York Post reported. The asking rent was $40 per square foot, according to the Post.

100 Bayard St (Brooklyn)

14,000

Renzo Gracie Academy / n/a

n/a / J. Segal, L. Smith, Sholom & Zuckerbrot

The athletic training center signed a lease.

104 West 27th St

10,000

King K-9 LLC / Jean Bates, A.C. Lawrence

Marvin Davis / n/a

The tenant signed a 10-year lease for a D Pet Hotels location. The reported asking rent was $46 per square foot.

306 East Fordham Rd (The Bronx)

10,000

Pretty Girl / Zach Mishaan, Winick Realty

East Fordham DE / Zach Mishaan, Winick Realty

The fashion retailer signed a lease.

53 West 36th St

8,400

The Keg Room / Edward Reilly, Reilly Real Estate

Hidrock Realty / Represented in-house

The owners of the Keg Room signed a 20-year lease for another Irish pub, the New York Post reported. The asking rent was $70 per square foot, according to the Post.

207 East 94th St

8,000

The Little Gym / A. Pittel, P. Winston, Andrew A. Pittel & Co.

Glenwood Management / Jamison Weiner, The Manhattes Group

The fitness studio signed a lease, the New York Post reported. The asking rent was $100 per square foot, according to the Post.

691 Co-Op City Blvd (The Bronx)

5,000

Fair Party Depot / M. Sabbagh, A. Manopla, Kassin Sabbagh Realty

Roshenshein Associates / Represented in-house

The party supplies company signed a lease for its 13th location.

125 East 39th St

4,545

Suimon Inc. / B. Lewen, H. Goldfarb, S. Lindenfeld, R. Rajnarain, Grubb & Ellis

125 East 39th Street Realty / B. Lewen, H. Goldfarb, S. Lindenfeld, R. Rajnarain, Grubb & Ellis

The vegan Japanese restaurant signed a 10-year lease.

499 Park Ave

4,500

Daum Inc.; Haviland Inc. / Jonathan Krivine, Newmark Knight Frank

Hines / A. Amsterdam, G. Spiegelman, M. O’Neill, C&W

The art glass and porcelain products retailer signed a lease.

116 John St

4,100

The United States Post Office / D. Rubens, A. Shinn, Winick Realty

116 John Street / D. Rubens, A. Shinn, Winick Realty

The post office leased retail space.

1054 Southern Blvd (The Bronx)

3,300

Checkers / J. Rivera, S. Lorenzo, NAI Friedland Realty

1058 Southern Blvd Realty Corp. / Abraham Kassin, Kassin Sabbagh Realty

The fast-food chain signed a lease.

555 Grand Concourse (The Bronx)

2,943

Planet Wings / Sholom & Zuckerbrot

AAC Management Corp. / Schuckman Realty

The restaurant chain signed a new lease for another location.

715 Ninth Ave

2,900

Universal Gear / Marjorie Borell, NYCRS

n/a / n/a

The fashion retailer signed a 10-year lease for its second Manhattan location.

366 Fifth Ave

2,100

Potbelly Sandwich Shop / J. Roseman, M. Frankel, B. Birnbaumof, Newmark Knight Frank

Joseph P. Day Realty / Represented in-house

The sandwich chain signed a 10-year lease on the ground floor.

1384 Coney Island Ave (Brooklyn)

2,000

1384 J Coney Island Avenue Corp. / n/a

Grabino Family LLC / M.C. O’Brien

The children’s clothing retailer signed a lease.

131 West 21st St

1,800

Joe the Art of Coffee / Barry Williams, BCD

B. Brages Associated LLC / Midtown Commercial Real Estate

The café signed a 10-year lease. The reported asking rent was $60 per square foot.

1058 Southern Blvd (The Bronx)

1,700

Little Caesars Pizza / J. Rivera, S. Lorenzo, NAI Friedland Realty

1058 Southern Blvd Realty Corp. / Abraham Kassin, Kassin Sabbagh Realty

The pizza chain signed a lease for another location.

30 West 8th St

1,700

Stumptown / Thor Street Advisors

n/a / W. Abramson, A. Yao, Buchbinder & Warren

The coffee maker signed a 10-year lease.

153 Essex St

1,650

Subway / Morris Sabbagh, Kassin Sabbagh Realty

Kahan Family Irrevocable Trust / Josh Frank, Misrahi Realty

The sandwich chain signed a 10-year lease.

1529 York Ave

1,600

Forte Caterers / Richard Smith, Winick Realty

M&S Capital NY LLC / Andrew Stern, RKF

The catering company signed a lease.

961 East 174th St

1,470

Little Caesar Pizza / NAI Friedland Realty

AAC Management Corp. / n/a

The restaurant chain signed a new lease for another location.

57 Front St (Brooklyn)

1,253

Gem Spa / Lucille Ferrari, NY Casa Group

Two Trees Management / Caroline Pardo, Two Trees

The nail salon and spa signed a lease.

315 Sixth Ave

1,200

La Vid Wine and Spirits / J. Singer, C. Montemurro, Winick Realty

321 Sixth Avenue Partners LLC / J. Singer, C. Montemurro, Winick Realty

The liquor store signed a lease.

1360 Loring Ave (Brooklyn)

1,200

J & L Tax Inc. / n/a

Spring Creek LLC / M.C. O’Brien

The tax services provider signed a retail lease.

147 West 35th St

1,200

ID America / Nelson Mieses, Rescom Properties

n/a / Carlos Silverman, Falcon Properties

The tenant signed a five-year retail lease.

810 Rogers Ave (Brooklyn)

1,100

Loring Medical PC / M.C. O’Brien

Rogers and Church LLC / M.C. O’Brien

The medical office signed a retail lease.

808-10 Washington St

1,035

Christian Louboutin / Jeffrey Painser, Ripco Real Estate

TF Cornerstone / K. Bellantoni, P. Haber, RKF

The men’s fashion boutique signed a long-term lease.

2366 Flatbush Ave (Brooklyn)

1,000

Faros Tax Service / n/a

TGTM Realty LLC / M.C. O’Brien

The tax services provider signed a retail lease.

147 West 35th St

1,000

Optical on Pearl / Nelson Mieses, Rescom Properties

n/a / Carlos Silverman, Falcon Properties

The eyewear retailer signed a five-year lease.

1172 Flatbush Ave (Brooklyn)

800

United States Air Force / M.C. O’Brien

1172 Flatbush Ave LLC / M.C. O’Brien

The U.S. Air Force signed a lease for a recruiting center.

3215 Third Ave

629

Samsea / Alexander Hill, Winick Realty

Blue River Retail LLC / Alexander Hill, Winick Realty

The retailer signed a lease.

856 Nostrand Ave (Brooklyn)

619

Mamoudou Sow / M.C. O’Brien

New-Hab Housing Development Fund Corporation / M.C. O’Brien

The fashion tenant signed a lease for its second Crown Heights location.

98 Thompson St

600

Katherine Hooker / Robert Carbonara, First Allied Properties

Standard Realty / Robert Carbonara, First Allied Properties

The fashion designer signed a lease for a pop-up store.

400 East 74th St

600

Sunshine Body Works / J. Famularo, R. Idnani, NYCRS

Rojell Corporation / P. Irvine, C. Chiti, Irvine Realty

The acupuncturist signed a lease.

1248 Lexington Ave

510

Judaica Classics / Richard Smith, Winick Realty

133 East 84th Street LLC / Michael Papilsky, The Siderow Organization

The retailer signed a lease.

295 Madison Ave

400

Davidov Optical / Hal Shapiro, Winick Realty

WBM 295 Madison Owner LLC / Joshua Singer, Winick Realty

The eyewear retailer signed a lease for its first New York City location.

7 East 14th St

393

Creperie / C. Rapuano, J. Siegelman, Winick Realty

Victoria Retail LLC / S. Baker, J. Singer, Winick Realty

The crepe shop signed a lease.

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Retail leases continued Address

Size

Tenant / Representative

Landlord / Representative

Notes

1435 Lexington Ave

375

Richard Salome Flowers Inc. / Jane Slade, Tarter Stats O’Toole

1435 Tenants Corp. / H. Aaron, A. Gavios, Square Foot Realty

The florist signed a 10-year lease. The reported asking rent was about $138 per square foot.

Buys Address

Size

Buyer / Representative

Seller / Representative

Notes

620 Sixth Ave

700,000 sf office bldg

RXR Realty / n/a

Yair Levy; Joseph Chetrit; Charles Dayan / n/a

The sale of the office and retail building closed for $500 million.

870 Seventh Ave

934-room hotel

LaSalle Hotel Properties / n/a

n/a / Hodges Ward Elliot

The Park Central hotel sold for $396.2 million, or about $425,000 per key. The buyer plans to spend between $30 million and $35 million to renovate the hotel starting late this year, including an upgrade of guest rooms, bathrooms, corridors and the lobby by 2013.

70 Pine St

66-story office bldg

Metro Loft Management; Eastbridge Sarl / n/a

n/a / n/a

The property sold for $205 million. According to Real Estate Weekly, the building will be transformed into 700 luxury apartments and a high-end hotel, with the conversion slated to be completed in 2013.

11 East 68th St

100,000 sf apt. bldg

HFZ Capital Group; Vornado Capital Partners / n/a

n/a / n/a

The property sold for $170 million. HFZ will own and reposition the residential portion of the building, while Vornado will own and manage the retail portion.

377 East 33rd St

209-unit apt. bldg

Archstone / n/a

Madison International Realty; RFR Holding / D. Karson, H. Hwang, N. Rockett, C&W Sonnenblick Goldman

The property sold for $131 million. The buyer will rename the building Archstone Kips Bay.

One Battery Park Plaza

885,645 sf office bldg

The Rudin family / n/a

The Rose family / n/a

The Rudins bought out the Roses’ 50 percent stake in the building for about $80 million, the New York Post reported.

175 Kent Ave (Brooklyn)

113-unit apt. bldg

Equity Residential / n/a

The Chetrit Group / n/a

The property sold for $76 million, Crain’s reported.

59 West 35th St

146-room hotel bldg

Rockbridge Capital / n/a

Magna Hospitality / n/a

The Hampton Inn sold for $69.5 million, or about $476,027 per key, the New York Post reported.

138 East 50th St

Development site

Extell Development Co. / n/a

n/a / n/a

The development site sold for $61 million, the New York Post reported.

170 Broadway

Office bldg

Crown Acquisition; The Carlyle Group; Highgate Holdings / n/a

Troy Baydala, AMG Realty / n/a

The sale of the building closed for $55 million, the New York Post reported. The buyers plan to redevelop the property into a hotel with retail.

225 East 63rd St

15-story apt. bldg, 150 units total

Carmel Partners / n/a

Howard Lorber / n/a

The operating lease for the Renoir House sold for $44.5 million, the New York Post reported.

109-125 East 130th St

Five 6-story apt. bldgs, 179 units total

Preservation Development Partners / Matthew Eliassi, Besen & Associates

Tricham Housing Associates / Matthew Eliassi, Besen & Associates

The properties sold for $36 million. The complex will remain a Section 8 affordable housing development for at least 20 more years, according to the buyer.

445 Fifth Ave

3-story, 18,000 sf retail condo

Thor Equities affiliate / n/a

BFE / n/a

The retail condo sold for $32.5 million. BFE acquired the property in 1993 for $4 million.

1710 Avenue Y (Brooklyn)

1-story, 54,000 sf retail bldg

Sands Brooks / n/a

Feldco Development / n/a

The building housing a Super Stop & Shop grocery store sold for $28.5 million.

646 11th Ave

50,207 sf retail bldg

Girt Realty LLC / n/a

The World-Wide Group / n/a

The car dealership building sold for $27.75 million, the International Business Times reported.

14-20 East 103rd St

15,000 sf development site

Mount Sinai Hospital / n/a

The New York Academy of Medicine / n/a

The lot sold for $25 million. The site is currently used for parking and is zoned for residential use at a maximum floor-area ratio of 3.44.

290 Mulberry St

12-story apt. bldg, 9 units total

n/a / n/a

n/a / M. DeCheser, R. Burton, Massey Knakal

The newly developed property sold for $25 million. The building has 20,000 net sellable square feet of retail space, with apartments above.

133 Mulberry St

6-story, 41,900 sf apt. bldg, 16 units total

Local landlord / J. Goldflam, M. Ferrera, The HighCap Group

AM Manhattan Realty LLC / Tom Brady, Town Residential

The property sold for $22.25 million. The price represents a capitalization rate of 5 and a gross rent multiple of 13.5.

7-9 Harrison St

7-story, 33,400 sf apt. bldg, 24 units total

n/a / n/a

n/a / Nick Petkoff, Massey Knakal

The property sold for $20 million.

153-01 10th Ave (Queens)

60,519 sf retail bldg

Onyx Equities / n/a

ABA Partners / n/a

The shopping center anchored by a Waldbaum grocery store sold for $17.6 million.

508 West 24th St

2-story, 14,440 sf industrial bldg

The Carlyle Group / n/a

MetroVision Production Group / n/a

The warehouse sold for $16 million. The buyer plans to erect a 10-story residential building on the site.

65 Bank St

6-story, 25,614 sf apt. bldg

Benchmark Real Estate Group / George Niblock, Friedman-Roth Realty

n/a / Amy Grodenz, FriedmanRoth Realty affiliate

The walk-up building sold for $15.78 million.

RECENTLY SOLD FOR

$25,000,000

500 Chestnut Ridge Road, Woodcliff Lake, NJ Richard T. Guarino Managing Partner T: 646.253.0909 E: rguarino@ergpa.com

84 February 2012 www.TheRealDeal.com The

Andrew J. Greenberg Director of Investment Sales T: 646.253.9050 E: agreenberg@ergpa.com

Christopher J. Pedota Associate Director T: 646.253.0962 E: cpedota@ergpa.com

Buys continued Address

Size

Buyer/ Representative

Seller / Representative

Notes

73 and 75 East 3rd St

Two 6-story apt. bldgs, 49 units total

n/a / Tim Crowley, Flank Brokerage LLC

n/a / J. Ciraulo, C. Waggner, Massey Knakal

The adjacent properties sold for $15.5 million.

North 6th St between Bedford Ave and Driggs Ave (Brooklyn)

3-story, 37,500 sf church bldg

Private investor / David Behin, MNS

Roman Catholic Archdiocese of Brooklyn / Andrew Scandalios, Holliday Fenoglio Fowler

The church sold for $13.7 million.

24-02 Queens Plaza South (Queens)

75,000 sf industrial bldg

Atlas Capital Group / n/a

Electric Realty / John Reinertsen, CBRE

The property sold for $13.5 million.

70-10 Austin St (Queens)

21,000 sf office bldg

Sawyen / n/a

Heskel Group / n/a

The commercial building sold for $13.35 million. The property has been anchored by a Sprint store for more than 20 years. Sprint recently renewed its lease at about $120 per square foot, keeping the property 100 percent occupied. Other tenants include an AT&T store, several medical offices and Heskel Groupâ&#x20AC;&#x2122;s office.

113-117 Elizabeth St

30 units in 3 apt. bldgs

The Kalikow Group; Waterbridge Capital / Represented in-house

n/a / n/a

The apartments sold for $12.6 million. The units consist of 800-square-foot three-bedrooms.

141 East 49th St

Development site

Extell Development Co. / n/a

n/a / n/a

The property sold for $9.57 million, the New York Post reported.

1012 and 1018 Lexington Ave

Two 4-story apt. bldgs, 8 units total

n/a / n/a

n/a / Guthrie Garvin, Massey Knakal

The two buildings sold for $7.35 million. In addition to the residential units, each of the properties has retail spaces on the first two floors.

50 Orange St (Brooklyn)

5-story apt. bldg, 20 units total

n/a / n/a

The Watchtower Bible and Tract Society of New York / R. Knakal, S. Palmese, Massey Knakal

The property sold for $7.1 million.

129 Greene St

8,100 sf retail condo

Ascot Properties / K. Salmon, M. Marshall, Salmon & Marshall

n/a / K. Salmon, M. Marshall, Salmon & Marshall

The retail condo sold for $6.85 million. The unit is currently occupied by a Cite Furniture store.

4770 White Plains Rd (The Bronx)

3-story, 70,000 sf office bldg

Centers FC Realty LLC / Reggie Chennatu, Regency Homes Realty Group

Bruce Meir Realty Corp. / Teddy Kafif, Bruce Meir Realty Corp.

The property sold for $6.5 million.

105 Avenue P (Brooklyn)

6-story, 45,000 sf apt. bldg, 42 units total

n/a / n/a

n/a / J. Shalom, S. Preuss, Massey Knakal

The property sold for $5.5 million, or about $122 per square foot.

292-294 Atlantic Ave (Brooklyn)

4-story, 7,520 sf mixed-use bldg

n/a / n/a

n/a / S. Palmese, W. Clifford, Massey Knakal

The property sold for $5 million, or about $665 per square foot. The building contains three stores, two offices and four apartments.

675 East 233rd St (The Bronx)

49-unit apt. bldg

n/a / Ronnie Shaban, Besen & Associates

675 East 233rd Street Realty LLC / A. Doshi, L. Blumberg, Besen & Associates

The walk-up building sold for $3.85 million.

31-32 Union St (Queens)

7 comm. units, 10,000 sf total

Queens Borough Public Library / n/a

DelShah Capital / n/a

The seven street-level commercial spaces at the base of the Sunrise Terrace condominium sold for $3.5 million.

315 West 53rd St

3-story, 2,364 sf office bldg

n/a / n/a

n/a / Christoffer Brodhead, Massey Knakal

The property sold for $2.65 million. The building has retail and storage space on the ground floor with office space on the upper two floors.

413-421 Troutman St (Brooklyn)

17,500 sf industrial bldg

n/a / n/a

n/a / M. Amirkhanian, P. Smadbeck, Massey Knakal

The warehouse building sold for $2.38 million.

883 Franklin Ave (Brooklyn)

4-story, 22,400 sf apt. bldg, 31 units total

Fortress FS LLC / Aaron Jungreis, Rosewood Realty

883 Franklin LLC / Aaron Jungreis, Rosewood Realty

The walk-up building sold for $2.31 million. The price represents a gross rent multiple of 7.7.

51 Hester St

7-story apt. bldg, 5 units total

n/a / n/a

n/a / Michael DeCheser, Massey Knakal

The property sold for $2.2 million, or about $402 per square foot. The price represents a capitalization rate of 4.5 percent.

1795 Amsterdam Ave

5-story, 11,360 sf apt. bldg

n/a / George Niblock, FriedmanRoth Realty

n/a / Rob Stein, Friedman-Roth Realty affiliate

The property sold for $1.58 million.

137 West 25th St

3,249 sf retail condo

n/a / n/a

n/a / B. Emmetsberger, A. Essick, Massey Knakal

The commercial condo sold for $1.55 million, or about $960 per square foot.

121 Vermilyea Ave

5-story, 12,240 sf apt. bldg, 16 units total

n/a / n/a

n/a / Robert Shapiro, Massey Knakal

The property sold for $1.18 million. The building contains 12 two-bedrooms and four three-bedrooms.

1700 Mahan Ave (The Bronx)

3-story mixed-use bldg

n/a / n/a

n/a / D. Shragaei, S. Antebi, GFI Realty

The property sold for $1.05 million. The price represents a gross rent multiple of 7.

Financing Address

Size

Borrower / Representative

Lender / Representative

Notes

9 West 57th St

1.6 million sf office bldg

Sheldon Solow / n/a

Deutsche Bank AG / n/a

A $625 million loan was provided to refinance the building, Bloomberg News reported. Deutsche Bank AG beat out American International Group and JPMorgan Chase to provide the loan.

555 West 53rd St

850-unit apt. bldg

Two Trees Management / n/a

Wells Fargo; JPMorgan Chase / n/a

Two construction loans totaling $229 million was provided for the financing of the second phase of development at Mercedes House. The first phase opened for occupancy in May. A team led by John McCarthy of law firm Morrison & Foerster represented the lenders on the deal.

301 East 75th St

137-unit apt. bldg

301 East Tenants Corp. / n/a

NCB / n/a

A $5.5 million first mortgage was provided for the building.

1200 Madison Ave

73-unit apt. bldg

1200 Tenants Corp. / n/a

NCB / n/a

A $1.8 million first mortgage, a $1.8 million second mortgage and a $1 million line of credit were arranged for the building.

150 East 77th St

95-unit apt. bldg

150 East 77th Street Corp. / n/a

NCB / n/a

A $4.5 million first mortgage was provided for the building.

66 Crosby St

37-unit apt. bldg

Soho Plaza Corp. / n/a

NCB / n/a

A $4 million second mortgage was arranged for the building.

470 West End Ave

105-unit apt. bldg

470 West End Corp. / n/a

NCB / n/a

A $3.3 million first mortgage and a $500,000 line of credit were arranged for the building.

20 Plaza St (Brooklyn)

103-unit apt. bldg

20 Plaza Housing Corp. / n/a

NCB / n/a

A $3.3 million first mortgage and a $500,000 line of credit were arranged for the building.

2550 Independence Ave (The Bronx)

140-unit apt. bldg

2550 Independence Avenue Owners Corp. / n/a

NCB / n/a

A $3.1 million first mortgage and a $500,000 line of credit were arranged for the building.

1615 Avenue I (Brooklyn)

375-unit apt. bldg

Terrace Gardens Plaza Inc. / n/a

NCB / n/a

A $3.5 million line of credit was arranged for the building.

55 East 66th St

27-unit apt. bldg

55 East 66th Street Corp. / n/a

NCB / n/a

A $2 million first mortgage and a $1 million line of credit were arranged for the building.

000 October www.TheRealDeal.com 80 July 20092008 www.TheRealDeal.com

www.TheRealDeal.com February 2012 85

Financing continued Address

Size

Borrower / Representative

Lender / Representative

Notes

142-162 Bard Ave (Staten Island)

60-unit apt. bldg

Bard House Inc. / n/a

NCB / n/a

A $1.5 million first mortgage and a $500,000 line of credit were arranged for the building.

810-811 Fifth Ave

12-unit apt. bldg

811 Fifth Avenue Corp. / n/a

NCB / n/a

A $1.5 million first mortgage was arranged for the building.

Other Deals Kushner, CIM close on 200 Lafayette Jared Kushner’s Kushner Companies and Los Angelesbased CIM Group closed last month on the $50 million purchase of a 90,000-square-foot office tower at 200 Lafayette Street, on the corner of Broome Street, a source told The Real Deal. Kushner and CIM, who bought the building from investors John Zaccaro Sr. and John Zaccaro Jr., are planning a $20 million renovation to turn the property into state-of-the-art office space. The building was marketed by Robert Burton, senior vice president of sales at Massey Knakal Realty Services, as well as Debra La Chance and Ariel Brenner of the Corcoran Group. (The deal was announced after the deadline for the Deal Sheet.)

3 WTC could be capped at seven stories Three World Trade Center is close to being topped off — 73 stories shorter than initially planned. Crain’s reported that if developer Larry Silverstein, president of Silverstein Properties, cannot find an office tenant for the planned 80-story tower by the end of the year, he’ll cap it off at seven stories and seek retail tenants to fill the structure. After talks with UBS broke off Silverstein has not come close to finding a tenant, Crain’s said, but if one is found in time, Silverstein

will resume construction as planned on 3 WTC with slight delays to the expected 2015 completion date.

Taconic to buy Tribeca development site for $65 million Real estate asset management firm Taconic Investment Partners has struck a deal to buy a prospective development site at 71 Laight Street in Tribeca for $65 million, Crain’s reported, and is planning a residential building with 30 to 40 units at the site once the transaction closes in May or June. Seller Alvaro Arranz bought the land, which currently houses a warehouse and parking garage, for $57 million in 2007, Crain’s said, and had previously hired architect Morris Adjmi to design two residential buildings for the site. Arranz’s plans had already been approved by the city’s Landmarks Preservation Commission. (The deal was announced after the deadline for the Deal Sheet.)

Barnett acquires three more Far West Side sites from Central Parking System Following the purchase of a 44,564-square-foot parking garage on West 44th Street for $29 million earlier last month, Gary Barnett’s Extell Development acquired three

more prospective development sites from Central Parking System on West 36th and West 37th streets, according to public records filed with the city Jan. 23. The three sites — two adjacent lots at 430 West 37th Street, 434 West 37th Street and another one at 429 West 36th Street — include a four-story, 17,702-square-foot garage with 12,711 square feet of usable floor area, which is zoned as commercial overlay within a residential district, an adjacent 4,937-squarefoot vacant lot, and a 9,890-square-foot garage, respectively. The final purchase price for the transaction, which closed Dec. 1, was $15 million. (The deal was announced after the deadline for the Deal Sheet.)

Canadian hotel company buys Midtown development site for $19.6M Canadian hotel management and franchise company Executive Resorts and Hotels closed on the purchase of four adjacent low-rise buildings at 38-44 West 36th Street, a source with knowledge of the deal told The Real Deal last month, and has plans to build a hotel on the site. Executive, which is based in Vancouver, purchased the prospective development site from an LLC named Divya Malini Realty. (The deal was announced after the deadline for the Deal Sheet.) TRD

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Euro distressed buyers

from page 48

Glenn Rufrano, president and CEO of Cushman & Wakefield. “Because liquidity has dried up in the banking system [in Europe], there is a perceived need for banking, and the ability to provide financing,” he said. “Starwood, Brookfield, Blackstone, Cerberus and Lone Star are some of the companies that we know that have been looking at opportunities.” Rufrano noted that institutions are not picking up assets in the most struggling European economies, such as Greece, Italy and Ireland. Instead, they are looking to buy leased-up, Class A properties in the bigger, more traditionally sound cities. That goes for those looking to invest directly in properties, too, he said. A recent snapshot on Cushman’s blog showed that the “winning” investment cities in Europe were London, Paris, Stockholm, Berlin and Hamburg. This summer, Tishman Speyer bought the Sanctuary

Buildings office in London for 175 million pounds, or $268 million, from Irish property company Vico Capital. The building is occupied until 2017, according to various media reports. The cities attracting investment are in countries expected to have better economic growth in the coming years, which makes for less risky bets, Rufrano said. One exception is the September purchase by investment management firm W.P. Carey and Company — which has offices in Midtown — to buy a fund that owns 20 stores in Italy leased to retailer Metro Italy for 300 million euros, or $400 million. It marked the firm’s first foray into the country’s real estate market. But Metro Italy’s parent company, Metro AG — the world’s fourth-largest retailer — also guaranteed the store’s obligations under the leases, thus reducing some of the risk associated with the stores’ location. “Of course, the other variable is currency,” Rufrano said.

“It’s my sense there is concern on the part of U.S. institutions because there’s little clarity on what’s going on over there.” As the dollar grows stronger against the euro, it makes prices in Europe cheaper for New York–based investors who are looking for a foreign deal. But many local building owners in Europe aren’t ready to take their losses, said Jahn Brodwin, a senior managing director at FTI Consulting, so not much is up for sale. “They bought properties when the euro was strong, so they would take a loss on real estate valuation and on the currency exchange,” he said. “They have no equity in many properties to pay off their loan.” Additionally, while no one is ready to bet that the euro’s existence is in danger, there are outlying worries that some countries, such as Greece, may drop the currency. That could spell disaster for real estate bought and leased up in euros in those countries. TRD

ever in Canada. Brookfield is no stranger to residential real estate. Its Brookfield Residential Properties is a home-builder in the U.S. and Canada that manages 100,000 properties. And its brokerage and franchise operation now has 80,000 affiliated agents globally, including the national franchise Real Living. Yet some critics say it may be over its head in a potentially historic residential project in the city. Brookfield Asset is trying to do its first condo conversion in New York at Stuy Town and Peter Cooper Village. If successful, it will be the largest condo conversion in New York City history, with about 11,500 apartments. City Council member Daniel Garodnick, who lives in the complex and works with the Tenants Association, said: “The goal is to put together a bid in the spring” for Brookfield to buy the property, in partnership with residents. “The tenants met with dozens of potential partners. They felt Brookfield had the capacity to bring them to a positive result.” But some question the feasibility of that plan. Attorney Adam Leitman Bailey, who has significant experience in condo conversions, said that while it’s a noble idea, the conversion is probably a pipe dream. “Tenants buying their apartments in today’s home-purchasing environment could only happen if you believe in Peter Pan and Neverland.” He said tenants living in rent-stabilized apartments by definition don’t make more than $200,000 per year, and will therefore have trouble buying their apartment anywhere near market levels, in part because of the tough lending market. Garodnick said there might be novel property tax abatements that would allow the deal to work. Also on the residential front, Brookfield’s $110 million purchase of Prudential Real Estate and Relocation Services expands its hold on the residential corporate relocation market. Brookfield is a leader globally in relocations, and it may be able to feed business to Prudential Douglas Elliman, some agents suggested. Dottie Herman, CEO of Prudential Douglas Elliman, said her only meeting with the firm about the deal was a brief one in December at her Midtown office, even though her

company is the largest in the network and pays millions of dollars each year in franchise fees. She is scheduled to have a more in-depth meeting this month. But Brookfield’s purchase has already convinced her and co-owner Howard Lorber to consider reversing their plan to drop the franchise when it expires in a little over a year, she said. “We don’t know anything, so we cannot make a decision,” she said, noting that the reason they wanted out of the Prudential agreement was her company was restricted from expanding in Florida. “We want to see what they have to offer. If we can’t grow, we’ll leave.” A spokesperson for Brookfield said Elliman was in “good standing,” and added, “We do not comment on affiliates’ franchise agreements.” One insider close to the firm called Brookfield Asset Management’s CEO, Bruce Flatt, the “wizard” behind the scenes. Sources say he’s been hands-on in New York City for years. For example, Flatt was instrumental in 1993 in beginning negotiations to buy the World Financial Center out of bankruptcy. And, in 2002, months after the Sept. 11 attacks, reports say Flatt led an effort to buy Lehman Brothers’ interests in one of the WFC towers for just $128 per square foot. “Bruce Flatt. That is the guy you make a big deal with,” one leading leasing broker said. “He will be in the room.” Since the firm’s presence in Manhattan is dominated by its office holdings, Clark, Brookfield Office Properties’ CEO, is the most familiar face to the industry here. He’s even on the advisory board of local brokerage firm Massey Knakal Realty Services, according to an article last year in the trade publication the Mann Report. Under him, most of the leasing is handled by a team led by Larkin, who, like Clark, is a veteran from Olympia & York. David Falk, president of the New York Tri-State Region of Newmark Knight Frank, said, given all of Brookfield’s new projects and pursuits, “You can just feel their presence in the city more, from broker functions to advertising to Manhattan West. “They are not just staying status quo with their Class A product in Downtown and Midtown,” he added. “You can feel their ambitions are larger.” TRD

Brookfield from page 57 that needs to be absorbed, you’ve got to see the Trade Center and Financial Center lease up first.” Many in the industry put Brookfield Asset Management in the same class as private equity giants like Blackstone Group or Kohlberg Kravis Roberts. But in some ways the firm, which does have a private equity arm, is more akin to a General Electric — a massive conglomerate of industrial firms, finance and investment management. The company had $13.6 billion in revenues in 2010, the most recent full year available on record, and has about $12 billion in its own and investors’ equity to place in a variety of industries globally. It has a wide array of real estate divisions, the most well-known of which is the publicly traded Brookfield Office Properties. Brookfield Office, unlike the more restricted REIT model used by SL Green Realty, for example, has a slightly different corporate structure that allows it to reinvest its profits. As of the end of the third quarter of 2011, Brookfield Office Properties owned 79 million square feet in 111 properties in North America and Australia, and JPMorgan Chase analysts anticipated annual rental revenues of nearly $2.2 billion, up 20 percent from 2010. But Brookfield Asset Management, too, invests in real estate. It owns 38 percent of the formerly bankrupt General Growth Properties, which operates the Staten Island Mall, the largest in the borough, and through a European subsidiary controls a share of London’s high-end office towers known as Canary Wharf. In New York, the firm last year hired investment sales brokers Eric Anton and Ronald Solarz from mid-tier sales firm Eastern Consolidated to help expand the real estate finance platform at global investment bank Brookfield Financial, a Toronto-based subsidiary of the company, which entered the New York market in 2009. Some critics said, however, there may be a conflict of interest for a major property owner like Brookfield to also have an investment sales arm, even as firms like CBRE, Newmark Knight Frank and Andrew Farkas’s Island Capital Group all have affiliates that are property owners as well as brokers. Anton said, however, that “there is a Chinese Wall” between different divisions of Brookfield, and noted that none of the major property owners he’s met with since joining the firm have expressed any concern over a conflict. “I have not had any resistance like that from the owners, and I am talking to the biggest owners in the city,” he said. The division has not announced any significant transactions in Manhattan to date, but did land the assignment to market $21.7 million in Bank of America loans on commercial multifamily properties. And, the company, which was founded in 2003, has completed some of the largest deals 88 February 2012 www.TheRealDeal.com

C O R R E C T I O N S A N D C L A R I F I C AT I O N S In the January issue story “Leasing Legends,” The Real Deal incorrectly identified Andrew Peretz as an executive director at Cushman & Wakefield. His correct title at the firm is executive vice president. In addition, Newmark Knight Frank’s Neil Goldmacher was incorrectly identified as an executive vice president. His correct title at Newmark is vice chairman and principal. In the January issue story “Construction lending shackles loosen,” The Real Deal incorrectly attributed to Gregg Winter, president of financial firm Winter & Co., a statement that it would cost $1,700 per square foot to build a boutique condo project that would qualify for a construction loan. He intended to say that the project would sell for $1,700 a square foot or more.

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Preferred lenders

from page 18

apartment,” said Shnayder. “But if the seller has a preferred lender, they weed out all of those problems in advance.” Ross Weinstein, managing partner of Brooklyn-based mortgage broker Exclusive Capital Consultants, said his company started helping resale owners find preferred lenders last year, after receiving requests from building managers. “They were getting a lot of heat from residents who were saying, ‘I can’t refinance, and my buyer can’t get financing,’” Weinstein said. “We started offering them the same support that we give new developments.” If a building is nonwarrantable, Weinstein’s company

helps sellers find portfolio lenders with more flexibility than the big banks, he said. Some of the lenders Weinstein has used for this purpose include Texas-based Nationstar Mortgage, Icon Bank, Astoria Federal Savings and Hudson City Savings Bank. “It’s all about asking the right person for financing,” said Shnayder, who does the same kind of research for his clients. Because Shnayder’s company is a mortgage bank, he also has the option of simply underwriting the loan himself, which he said he does for about 85 percent of his business. Most home sellers, of course, have no idea about any of this when they decide to sell their apartments. So it’s

crucial for real estate brokers to be knowledgeable about the process, said attorney Neil Garfinkel, of Manhattan law firm Abrams Garfinkel Margolis Bergson. Along with Shnayder, Garfinkel recently started holding seminars to educate real estate brokers about various options for sellers, including obtaining a preferred lender. “A seller putting an apartment up for sale doesn’t necessarily consider these things,” Garfinkel said, “but a good broker will recommend it.” Shnayder echoed that, adding, “In the new regulatory environment that we’re in, there is so much red tape that it’s important to get a seller involved in helping their buyers get financing in any way they can.” TRD

teamed up with hedge fund Odyssey Partners to purchase the old IBM headquarters at 590 Madison Avenue for $200 million — as “controlling,” a “tenacious as a bulldog” and prone to “rampages and tantrums.” Back then, Minskoff acknowledges, he was motivated by a “chip on his shoulder” against his family. “But I have far surpassed that, probably over 20-some years ago, so that part of my mind-set doesn’t exist anymore,” he said. “I’m totally at peace with it. ... Today, I guess I am much more comfortable with myself. So it’s probably not as intense as it was.” However, he still does, on occasion, clash with partners. At the 414,000-square-foot ofﬁce building at 101 Sixth Avenue, Minskoff has, in recent years, repeatedly butted heads with partner the Andalex Group. Minskoff constructed the building in 1991 and, with Andalex, leased it to Local 32BJ of the Service Employees International Union. Late last year, after the SEIU announced plans to vacate the site and move to a smaller space, Minskoff brought out Andalex for an undisclosed price. Andalex did not return calls for comment. “We didn’t get along; let’s put it that way,” Minskoff said. “There was no chemistry between us and the direction we were going in was not the direction I wanted to go in. ... I bought 100 percent of it, and I will not be inhibited moving forward by their actions.” Minskoff is now planning a gut renovation there, so that “the building will be 21st-century brand-new when we are done.” (The mortgage on the property expired in early December while Minskoff and Andalex were completing their deal, which earned 101 Sixth Avenue a spot on a recent list of properties with distressed loans. But Minskoff said the lender was in the loop the whole time, and there was never any question that the loan would be extended. He signed a two-year extension on the mortgage with the same lender on Dec. 30,

as soon as the deal with Andalex was complete.) Despite occasional reports of his contentiousness, some who’ve worked with him in the past praise his vision. In 2008, Minskoff completed a 1 million-square-foot, mixed-use development in Tribeca, begun in the wake of the 2001 World Trade Center attacks. The site, which included a retail building at 270 Greenwich Street, residential condos at 101 Warren Street and a 12-story apartment building at 89 Murray Street, is “one of the greatest success stories in the history of development in New York City,” insisted James Lansill, a senior managing director at the Corcoran Sunshine Marketing Group, which a year and a half ago finished up the sales of 234 condos at the site. “He took a neighborhood that was a relatively barren kind of transitional space and converted it into a thriving residential community,” he said. Minskoff, he added, is “his own guy. He’s a leader, not a follower, and I find that doesn’t always go with being polite. It’s very easy to get really nervous in this industry, and want to change strategies, and he is just a man with very strong convictions.” Not all of Minskoff ’s investments, of course, have worked out as well. He recently abandoned plans to build a 635-room dormitory in Long Island City, selling a 238,000-square-foot building for $21.5 million, five years after purchasing the property for $15.75 million. The reason, he insisted, is so he can focus on 101 Sixth Avenue and 51 Astor Place. Whether those instincts will prove him right at 51 Astor Place depends largely on the direction of the market. But Minskoff has little doubt the market will rise to meet him. Close to 26 million square feet of leases are rolling in 2013 and in the first quarter of 2014, he pointed out, “which is the time frame our building will be completed.” The timing, he argued, couldn’t be better. TRD

unemployment rate, now at about 6 percent, is lower than the current rate in the U.S. Finally, the projected inflation rate has slid steadily since late last year to around 5 percent, while home prices have risen year-over-year since before the Great Recession. Not surprisingly, given these favorable economic indicators, Brazil’s commercial hubs boast vacancy rates that would make Manhattan landlords envious. In São Paulo, Brazil’s business capital and largest city, the vacancy rate for high-end office space was 7.4 percent by the end of the third quarter of 2011, according to Jones Lang LaSalle’s most recent figures, slightly lower than the quarter before. In Rio de Janeiro, the second-larg-

est city, the real vacancy rate, taking into account signed contracts for leases, was a paltry 4.4 percent by the third quarter’s end. The average asking rent for both cities’ top space was around $70 to $80 a square meter per month, Jones Lang LaSalle said. How long can such growth continue? It might depend on Brazil’s emerging-market competitor and top trading partner: China. “If China has a slowdown, Brazil could be impacted,” Munro said. “Will it go on forever? No, but it appears to have at least 10 years of moderate-to-good growth ahead.” TRD

Minskoff from page 41 for his creative talents, not for his expertise in the field, because that you can hire easily.” During his time at the company, Minskoff oversaw an aggressive expansion of the firm’s New York presence, most notably with the construction of the 7.5 million-squarefoot World Financial Center. At the time, he noted, the Wall Street Journal ran a front-page story “saying I was certifiable for ever committing to build 7.5 million square feet all in one fell swoop, but I didn’t think the project would have been successful unless we did that much space.” Minskoff believed in the project, in part because it was located in proximity to billions of dollars of mass transit — a benefit he also sees applying to his Astor Place property today. “The World Financial Center was actually a deal that, when I did it, I really never thought, and still don’t think, I could ever duplicate it — not in my lifetime,” he said. “I chose every piece of stone in that development.”

No more tantrums When Minskoff left the company after ﬁve years, he sold his equity stake back to Olympia & York for $40 million, pocketing $26 million in cash. That money helped bankroll Edward J. Minskoff Equities, the ﬁrm he founded in 1987. Today, in addition to deploying his own capital, he also invests for a wide array of “institutions, private equity funds, high-net-worth individuals and friends in the industry,” according to a spokesman. He has also done joint ventures with partners ranging from the State Teachers Retirement System of Ohio to Vornado Realty Trust. In addition, he owns and manages about 4 million square feet, mostly in New York City. Through the years, Minskoff has earned a reputation for his strong opinions and has been variously described — to quote from press accounts from the early 1990s when he

Brazil from page 64 of the things that we like about the countries in which we invest in,” said Brian Finerty, a senior vice president of investments at Equity International. “We always go back to these key criteria for a country, which are: emerging middle-class, growing consumerism, large housing deﬁcits, large population sizes ... [and] some semblance of a ﬁnancing market.”

A free-spending class The macroeconomic news from Brazil is seemingly good. In 2010, the country’s gross domestic product grew by its highest rate ever — 7.5 percent. And while it slowed in 2011, it still grew by around 3 percent. Meanwhile, the

90 February 2012 www.TheRealDeal.com

Commercial market

from page 24

at the Time Warner Center; law ﬁrm White & Case, located at 1155 Sixth Avenue; and Viacom, which is looking for 1 million square feet (see accompanying chart on page 24). They will be doing so in a Manhattan market where the average asking rent rose by 8 percent to $51.40 per square foot in December 2011 from $47.66 per square foot in December 2010. Meanwhile, the availability rate — which measures ofﬁce space available for rent now or in the next 12 months — stood at the end of last year at 10.9 percent, on a steady improvement from 12 percent at the same point a year ago, statistics from Cassidy Turley show.

Midtown Some of the largest tenants on the hunt for new space are currently located in Midtown, so moving would open up large blocks of space there. Whether firms are quietly contemplating relocating is obviously closely held information. As a result, predicting how much space they’ll vacate is not easy for market analysts. But what analysts do know is that, for Manhattan, large tenants (those with 100,000 square feet or more) signed relocation leases for more than 26 million square feet in 2011, but just less than 15 million in renewals. That clearly shows that for many tenants, relocating is more common than staying put. Although not large deals, Midtown has seen some highprofile activity in recent weeks. On the last day of 2011, global consulting firm McKinsey & Company renewed its lease for 26,450 square feet on the fifth floor of 875 Third Avenue at a building represented by Jones Lang LaSalle brokers Diana Biasotti and Paul Glickman, CoStar records show. There was no estimate of the rent provided, and Biasotti and Glickman did not respond to a request for comment. The average asking rent in Midtown rose by 6 percent to $58.68 per square foot in December 2011, while the availability rate dropped to 11.6 percent, the same level as a year ago, after peaking in March at 12.4 percent.

Midtown South If Credit Suisse, one of the largest tenants in the market, were to relocate from 11 Madison Avenue, as some speculate it may, it would send shock waves through Midtown South. A departure by the financial giant — which CoStar shows occupies 1.6 million square feet in the 2.2 millionsquare-foot office building — would provide much-needed space in the tightest market in the country, which has a Class A vacancy rate of only 8 percent. Still, Newmark’s Weiss saw a potential relocation as a blow to the neighborhood. “It would hurt [Midtown South] severely,” he said. “It would be such an enormous hole, it would take years to fill. [Credit Suisse] is an enormous fish in that pond.” Despite news reports about landlords pulling back on concessions, sources say building owners are, in fact, providing more free rent and tenant improvements than most in the industry realize. For example, handbag and fashion designer Kate Spade signed a new deal for 86,000 square feet of corporate office space in November at 2 Park Avenue, between 32nd and 33rd streets. But while the deal was reported in the mid-$40s per square foot, the effective rent (which factors in concessions) was lower, according to industry sources. The designer got eight months of free rent and $55 per foot worth of tenant improvements, bringing the effective rent, the source said, to just $33 per foot over the 10-year lease. The average asking rent in Midtown South was $41.91 per foot at the end of 2011, up 9.6 percent from $38.23 per square foot in December 2010, Cassidy Turley figures show. And, speaking to the tightness in the market, the availability rate has plummeted in the last year, down 2.5 points from 12 percent in December 2010.

Downtown The Downtown market, and speciﬁcally the World Financial Center, stands to gain if some of the large tenants in the market, like Credit Suisse or Citigroup, can be pried loose from their current locations and induced

to take space there. But there are some big tenants Downtown that are also considering uprooting. For example, law firm Hughes Hubbard & Reed — currently located in 1 Battery Park Plaza and represented by Newmark Knight Frank — is on the hunt for about 250,000 square feet. Meanwhile, law firm Milbank Tweed, Hadley & McCloy, now located in 1 Chase Manhattan Plaza, is in the market for about 350,000 square feet, though recent reports suggest it might ultimately renew its lease there. As in Midtown South, some landlords made large concessions Downtown to close deals. In fact, according to data from JLL, there was an increase in landlord contributions Downtown in the fourth quarter, compared with the same period in 2010. One such generous deal came at Donald Trump’s 40 Wall Street, where structural engineer Weidlinger Associates inked a lease. The firm took 61,082 square feet for 20 years, with a rent starting at $27 per square foot, which included 12 months of free rent and $65 per square foot in improvements paid for by the landlord. Donald Trump Jr., executive vice president for development and acquisitions at the Trump Organization, said that rent package isn’t reflective of what his firm is offering for other spaces in the building. “We are also leasing in the high $40s and low $50s in the tower portion of the building,” he said. Those prices were a bit above the average asking rent Downtown, which was $37.99 per square foot at the end of 2011, just $0.14 per square foot higher than the end of 2010. In the same period, the availability rate dropped sharply to 10.5 percent from 13.3 percent one year earlier, Cassidy Turley figures show. Overall, the older buildings Downtown, where rents are in the $20s and $30s per square foot, could attract large nonprofits, said Cassidy Turley’s Lebenstein. “I think it pushes the budget-sensitive ones south to Lower Manhattan or to the Far West Side. There is some very good space affordably priced in Lower Manhattan,” he said. TRD

The luxury list from page 47 was Craig Nevill-Manning, a top Google engineer and New Zealand native, who bought the spread for $8.25 million in 2005. Additionally, the pair brokered the sale of a $5.9 million condo in the Hubert at 7 Hubert Street. The seller, Nuprop Owner LLC, purchased the unit for just under $2.7 million in 2004. The buyer was also an LLC. Platinum executive vice president Daniel Hedaya handled two sales for the same client, T Sky LLC, in two different parts of the River Lofts condominium complex. One was in the tower portion at 92 Laight Street and sold for $11.5 million to ex-Deutsche Bank executive Michael Cohrs. (The other was a two-bedroom in another part of the complex that fetched $2.5 million, but was not included in The Real Deal’s ranking because it fell under the $5 million marker.) Ranking third in the neighborhood for 2011 was Dolly Lenz — a familiar name on top broker lists. Last year, the Elliman vice chair and power broker swooped in to help Alexis Stewart, daughter of Martha, sell a penthouse at the Ice House that had been languishing on the market since 2007. The 3,884-square-foot, two-level unit at 27 North Moore Street, a 1905 refrigeration building converted to 58 lofts, sold for $8.6 million. The buyers were hedge-funder James Flynn and his wife, Kerianne, who are reportedly planning to combine the home with an adjacent penthouse they own in the building. That’s not to say that Lenz didn’t score deals in oth-

92 Laight Street

er parts of Manhattan, including the $18.3 million sale of Winick Realty Group executive vice president Lori Shabtai’s Upper East Side townhouse. Other brokers made strong showings in Tribeca, among them Raphael De Niro, whose actor father Robert founded the Tribeca Film Festival. However, some of the broker’s more high-proﬁle deals didn’t quite make the cutoff, such as a unit at 195 Hudson Street that sold for a hair under $5 million, and director M. Night Shyamalan’s penthouse at 45 Walker Street, which closed too late for our ranking.

Other neighborhoods

he ranking excludes sales below $5 million in an effort to use the most accurate and comprehensive data. However, that meant effectively eliminating certain neigh-

borhoods — among them the East Village, the Lower East Side, the Financial District, Harlem and Inwood — because there weren’t enough deals that met the criteria. Naturally, top brokers working in these areas are still selling a hefty amount of real estate. Elliman’s Ariel Cohen, for example, brokered nearly $19 million worth of resales at 15 Broad Street in the Financial District, the 382-unit condo conversion where he helped with preconstruction sales in 2004 and has lived since 2007. Kelly Cole, a senior vice president at Corcoran, sold 23 properties in Inwood and Washington Heights. And, at CoOp Village, a collection of 12 co-op buildings clustered on the far east corner of Grand Street, two teams of brokers — Neal Young and Jeremy Bolger of Halstead and Jacob Goldman, the founder of Loho Realty — each sold close to $15 million in co-ops. Furthermore, brokers who have done the difﬁcult work of selling out new condo projects may not appear here, since the list does not include sponsor sales. That effectively cuts out Elliman’s Fredrik Eklund and John Gomes, who work at new developments across Downtown; Warburg’s Richard Steinberg, who was responsible for a slew of deals at Twenty9th Park Madison in Midtown South; and Brown Harris Stevens’s Shlomi Reuveni, who handily spearheaded sales at the Laureate on the Upper West Side, among others. TRD www.TheRealDeal.com February 2012 91

Residential market

from page 16

posed to investors or people looking to ﬂip a unit within a year or two,” said Elliman executive vice president Ariel Cohen, who specializes in the Financial District. Other buyers, meanwhile, are biding their time before buying, in anticipation of a double-dip recession, according to Katzen. “Buyers are saying that the worst is still to come,” she said, referring to the relative lack of bonus money hitting the market this year. “They want to start looking at what’s

being offered on the market ... because they believe that the sellers will be open to their offers, given this uncertainty.” While buyers may be planning ahead, renters are being forced to snap up apartments in an instant, fueled by a market that — winter notwithstanding — remains extremely tight. In the fourth quarter of 2011, renters took an average of 37 days to lease a Manhattan apartment, according to an

Elliman rental market report released last month. That’s the second fastest pace since the ﬁrm started tracking the number in 1995. “Many buyers and renters are still expecting the second dip of this recession,” said Julia Bryzgalina, director of leasing at Platinum Properties. “However, while buyers can afford to be cautious, renters do not have a choice but [to] follow the market’s upward trend.” TRD

one reason that agents don’t always respond well to halfmonth OPs. Another downside is that brokers receive fees up front when tenants pay them, but landlords often wait several months to pay up. Indeed, some brokers — especially in the outer boroughs — are adamantly opposed to partial OPs. Ari Silverstein, a City Connections Realty associate broker who works predominantly in Kew Gardens and For-

est Hills, said he is “wholeheartedly against” half-month incentives. Silverstein said his clients, especially in Queens, are always looking to avoid paying broker’s fees. Since he can’t advertise half-month OP apartments as “No-Fee” — fewer people inquire about those listings. “If landlords want to rent their apartments, the most effective thing to do is give a [full] OP,” said Silverstein. TRD

3. 240 Middle Neck Road (Sands Point)

this home in its place, evidently sparing no expense: The Mediterranean-style waterfront home has six bedrooms, nine bathrooms, an indoor pool and spa, a sunroom and a three-car garage. “There is a theater inside the house that is a replica of a small New York City theater,” Shroyer said. “Everything in the house is just amazing.” Nonetheless, the mansion saw a 13.25 percent price drop and sat on the market for 114 days. According to Shroyer, the buyer is another Long Islander, also retired.

Commissions from page 38 way to keep customers satisfied. Whether agents pocket the money or pass it on to their clients, they are ethically obliged to disclose they are receiving it, said Ron Zucher, president of Plaza Realty Group, a residential and commercial brokerage in Manhattan. According to Zucher, that disclosure usually happens verbally. This obligation — which can cause an awkward conversation if the broker decides to keep the cash — may be

Suburbs: Nassau from page 60 127 Horseshoe Road in Mill Neck sold in July for $14 million, making it the second-highest Nassau County sale for 2011. But before finding a buyer, the property sat on the market for more than a year and saw a price chop of nearly 30 percent from its original $20 million listing price. The home has six fireplaces and a media room. Devendorf did not return calls for comment.

Sale price: $13.88 million Original listing price: $16 million Broker: Patricia Shroyer, Harding Real Estate The $13.9 million sale of 240 Middle Neck Road in August was a record-setter for ritzy Sands Point, according to Shroyer. The seller, now retired, bought the four-acre property in 1988 then tore the house down in 2000 and built

Judge rules against Extell, Carlyle in Rushmore appeal Buyers may finally get back $16 million in deposits after several years of litigation BY DAVID JONES fter nearly three years of litigation, a state Supreme Court judge last month ordered the return of $16 million in disputed escrow deposits at the Rushmore condominium. In a 15-page decision, Justice Anil Singh sided with former Attorney General Andrew Cuomo, who in 2010 ordered developers Carlyle Realty Partners and Extell Development to return deposits to 40 buyers of apartments at the Upper West Side tower. The buyers had asked for refunds in 2009, after the developers missed a contractual deadline to close the first sale at the 289-unit building. In response, the developers argued that the wrong date was published in the offering plan due to an obvious typo, or scrivener’s error. They claimed that the buyers only filed for the refunds after the real estate market collapsed, and that they never really cared about the actual deadline. They asked the AG to let them change the language in the offering plan to reflect what they said was their actual intended closing date. Despite those arguments, Justice Singh agreed with Cuomo, who stated that there was no scrivener’s error because the contracts were drafted unilaterally, that the buyers’ intentions cannot be legally considered as evidence, and that the developers never provided any evidence to back up the claim that the 2008 deadline was a mistake. “The court has reviewed the attorney general’s determinations very carefully to determine whether they include any errors of law,” Singh wrote in the Jan. 19 order. “We find no such errors.” “After over 2.5 years before the attorney general and

92 February 2012 www.TheRealDeal.com

cials at Extell and Carlyle were not immediately available for comment. The developers responded to Cuomo’s order by filing an appeal in U.S. District Court, arguing that the entire proceedings at the AG’s office were a violation of due process under the U.S. Constitution. They claimed that they were denied an adequate opportunity for cross-examination, discovery and other wide-ranging exchanges of evidence at the hearings. They also wanted the chance to cross-examine all of the buyers to find out whether they relied on that deadline to determine whether they wanted their deposits back. They were repeatedly rejected on appeal, then took the case to New York state court. Andrew Weltchek, an attorney who is not involved in the case, said the developers had a tough argument to make because the courts are reluctant to interfere in administrative hearings, such as escrow disputes. After Cuomo was elected governor, the case was handed off to the then-new attorney general, Eric Schneiderman. A spokesperson for Schneiderman said the office was reviewing the case, and did not have any immediate statement. TRD The Rushmore

three different courts, we are very pleased that Justice Singh has agreed with four other judges, and found that the purchasers are entitled to the return of their down payments,” Richard Cohen, attorney for 33 of the 41 condo buyers, told The Real Deal in a statement. “We look forward to the escrow agent promptly returning the purchasers’ down payments.” Ed Normand, a partner at Boies, Schiller & Flexner, which represents the developers in this case, said he would have to check with his clients before commenting. Ofﬁ-

Rapid Realty

from page 30

with any bad habits.” He added: “We invest a lot of money in training. ... I believe I can train anyone who wants to learn to be successful.”

Franchise fever While Rapid’s approach to the business may not be popular with everyone, the firm has spread like wildfire. Unlike most franchises, Rapid Realty doesn’t currently charge franchise fees; instead, Lolli takes a cut of each agent’s commissions. That means franchisees pay only to lease and build out an office, which costs anywhere from $30,000 to $120,000. By comparison, McDonald’s requires franchisees to pay a minimum of $500,000 in nonborrowed, personal resources as a franchi-

see fee, according to its website. Lolli also keeps costs down by securing cheap office space for his franchisees; he said he has personally negotiated every Rapid Realty lease. Falquez said she invested $60,000 in the Rapid Realty office she opened in Bay Ridge, “with a lot of credit cards and some money [she] had saved.” But, she said, she made her money back in the first year. In December, she opened her second location in Sheepshead Bay, investing $75,000, and she is currently searching for a location in Soho. Falquez said Lolli takes a 15 percent cut of commissions earned by the agents in her offices, and she takes 18 percent (that’s not the case for all franchises; Lolli negotiates

these terms separately with each franchisee). Agents throughout the franchise have different incentive-driven commissions, depending on their role in the process and their performance. Rodriguez said her family “thought I was crazy at ﬁrst” for opening a Rapid Realty location. “Now,” she joked, “they want me to help pay their bills.”

“We’re being [hounded] by several investors [outside the company] to go public,” Lolli said. “They love the fact that a franchise is a modest investment and the overhead is low. We’re seriously considering it.” Lolli also said interested parties have approached him about buying an equity stake in the company, with a view to help the ﬁrm grow nationally. “We want to take our brand and plant our ﬂag in every desirable area across America,” he said. It’s a tall order, but Lolli has never let that stop him before. “I was raised to never bite off more than I can chew,” Rodriguez said, “but Anthony always says, ‘Just bite it, chew it and swallow it.’” TRD

Public plans With 50 new franchises slated to open in 2012, Rapid Realty shows no signs of slowing down. Lolli said he is taking some 10 franchisees on a trip to California this month to scout potential locations on the West Coast. There’s even talk of the company going public.

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C A L ENDAR

F E B RUARY 1

B’nai B’rith Real Estate hosts a luncheon, “Expanding the Governor’s Vision of a ‘New’ New York.” The keynote speaker will be Kenneth Adams, president of Empire State Development and commissioner of the New York State Department of Economic Development. The Cornell Club, 6 East 44th Street. Noon to 2 p.m. Fee: $70 up to two days in advance, $80 at the door. Contact: Aracelis Kuilan, (212) 885-7239 or akuilan@bdo.com.

The New York City Economic Development Corporation holds

the seventh-annual NYCEDC New Markets Tax Credit Conference. The group invites developers, notfor-profits, community development entities, investors and others to a primer on the New Markets Tax Credit, a federal program that can help investors reduce their income tax liability. 3 Spruce Street. Noon to 5:30 p.m. Fee: $35. Information and registration: www.nycedc.com.

The New York chapter of the American Institute of Architects presents “Miami21New Zoning: Lessons for New York?” The keynote speaker, Miami architect Elizabeth Plater-Zyberk, will discuss Miami21, the city’s groundbreaking new zoning code, which won the American Planning Association’s 2011 National Planning Excellence Award. Center for Architecture, 536 LaGuardia Place. 6 to 8 p.m. Fee: $10 for members, $20 for nonmembers. Information and registration: www.aiany.org.

The Real Estate Board of New York presents a commercial seminar entitled: “Believe in Growth: Where It’s Happening, Who’s Growing, Why It’s Happening, How to Get in On It.” REBNY Mendik Education Center, 570 Lexington Avenue. 8 to 10 a.m. Free. REBNY members only. Registration required. Contact: Desiree Jones at djones@rebny.com.

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The Art Fair Company presents the Metro Show, a new arts and design fair. Fair visitors will have the opportunity to connect historic and contemporary arts and design: paintings, furniture, drawings, prints, photographs, folk art, Native American art and applied and decorative arts. Featured speakers include James Brett, the founder of the Museum of Everything in London, who will launch the previously unavailable “The Books of Everything” with a Q&A and book-signing. Metropolitan Pavilion, 125 West 18th Street. 11 a.m. to 7 p.m. Fee: $15 per day, $30 for a four-day pass. Complimentary passes available for members of the American Society of Interior Designers. Information and registration: www.metroshownyc.com.

Greater New York’s Institute of Real Estate Management provides a course on “Sustainable Real Estate Management,” focusing on improving energy efficiency, water efficiency and indoor environmental quality. Knickerbocker Plaza, 1751 Second Avenue. 8 a.m. to 5 p.m. Fee: $99. Information and registration: www.iremnyc.org. 94 February 2012 www.TheRealDeal.com

presents a residential seminar, “The New Normal: What Top Brokers Need to Know.” Speakers include Jeffrey Appel of MetLife Home Loans, Diana Diaz of Argo Residential, Jerry Feeney of Jerry M. Feeney Residential Real Estate Law and Cathy Taub of Stribling & Associates. REBNY Mendik Education Center, 570 Lexington Avenue. 5:30 to 7 p.m. Free. REBNY members only. Registration required. Contact: Angela Donovan at adonovan@rebny.com.

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The Brooklyn Real Estate Roundtable hosts the first installment of its 2012 quarterly luncheon series. Speakers will include Joshua Muss, principal at Muss Development, and Bob Sanna, executive vice president at Forest City Ratner Companies. Brooklyn Historical Society, 128 Pierrepont Street, Brooklyn. Noon to 2 p.m. Fee: $1,000 for the series. Registration required. Information and registration: www.brooklynhistory.org.

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Real Estate Weekly presents a “Women’s Forum,” featuring real estate’s top women in finance, construction, investment, government and management. Speakers include Patricia Lancaster, former commissioner of the New York City Department of Buildings, and Faith Hope Consolo, chairman of the retail division at Prudential Douglas Elliman. McGraw-Hill Conference Center, 1221 Avenue of the Americas. 8 a.m. to 3 p.m. Fee: $249. Information and registration: www.rewomensforum.com.

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2The Real Estate Board of New York

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Crain’s New York Business hosts a breakfast forum featuring New York Attorney General Eric Schneiderman, who will discuss the prospects of a nationwide settlement with major banks on foreclosure abuses and share his thoughts on hydrofracking and the Indian Point nuclear plant. Moderated by Crain’s assistant managing editor Erik Engquist. Roosevelt Hotel, 45 East 45th Street. 8 to 9:30 a.m. Fee: $75 before Feb. 9, $80 thereafter. Information and registration: www.crainsnewyork.com.

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The New York Commercial Real Estate Women Network presents an educational program entitled, “Leveraging Your Connections in Today’s Economy,” featuring Collete English Dixon, vice president of transactions at Prudential Real Estate Investors and the 2011 president of CREW Network. Crowell & Moring LLP, 590 Madison Avenue. 6 to 8 p.m. Fee: Free for NYCREW members, $50 for other CREW chapter members, $74 for nonmembers, $25 for students.

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