The Real Deal March 2013 by The Real Deal

BAM: The next Lincoln Center

Is Solow in sell-off mode?

FEMA’s new flood zones

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Making a living as an expert witness

Brokers tackle extreme sports

THEREALDEAL N EW YO R K R E A L E S TAT E N E W S

www.TheRealDeal.com

Vol. 11 No. 3 March 2013 $3.00

Brooklyn’s building bonanza

FACT Asking rent at the proposed 3 Hudson Boulevard is $85 a foot, far more than Midtown South’s average, and may indicate what new office buildings near Hudson Yards will charge. See page 22.

AT A GLANCE Bidding wars get ‘absolutely insane’ Brokers say bidding wars are now taking place in the majority of residential deals in Manhattan, with multiple offers coming in on almost every wellpriced property. The culprit, they say, is the continuing inventory squeeze. See page 14. BY KATHERINE CLARKE A new wave of residential towers is slated to hit the Brooklyn market. With some 14,000 apartments on the way, the pipeline of Brooklyn construction is far fuller than it’s been in

A macro look at micro units Builders: Tiny homes make sense, but zoning doesn’t BY TOM ACITELLI In the wake of City Hall’s micro unit design competition, developers have grown increasingly interested in building tiny apartments. But do the units pencil out without public subsidies? Developers say they do, but that zoning changes are needed first. See story on page 57

recent years, due to the revival of stalled projects and the increasing willingness of lenders to finance projects in the outer boroughs. This month, TRD created a compendium of roughly 100 large new construction projects

MaryAnne’s moment

What Gilmartin’s promotion means for Forest City’s plans BY ADAM PIORE AND HAYLEY KAPLAN For years, MaryAnne Gilmartin has served as chief lieutenant to Bruce Ratner in the fight to develop Brooklyn’s controversial Atlantic Yards. Now, with Ratner reportedly planning to step down as Forest City Ratner’s CEO, Gilmartin is poised to become his successor. Insiders expect her to establish

A big appraisal firm on the brink

Once high-flying, MMJ is casualty of ailing sector

Izak Senbahar on managing his anger

BY GUELDA VOIEN At the market’s peak, Mitchell, Maxwell & Jackson was one of the most dominant appraisal firms in the city. Today, its two principals are fighting to hold onto their licenses and keep the company’s doors open. The downfall was set off by a lawsuit filed by a former employee, but changes that decimated the appraisal industry also played a part.

See page 118.

See story on page 34

PHOTO CREDITS ARE HERE

march 2013 mock cover5jn.indd 1

that are expected to launch in 2013 or later in prime Brooklyn areas. But unlike in Manhattan, where new condos are on the rise, many of the Brooklyn projects will be massive new rentals. See story on page 46

An ad overhaul

Broker teams on hit list if new rules get passed

her own legacy at the neighborhood-changing development firm by expanding the company’s portfolio and getting more active in industry lobbying. One of the most powerful women in NYC real estate, Gilmartin is part of a wave of female execs breaking barriers in the development and investment arena.

BY TOM ACITELLI New York State could finally pass new advertising rules for the real estate industry this month, the biggest changes in nearly two decades. The measure would have a far-reaching impact on NYC brokers, changing the way agents must deal with social media and even what they can name their teams.

See stories on pages 40 and 42

See story on page 16

How much do New York’s commercial firms make? A ranking of brokerages by sales and leases, plus a first-ever estimate of how much commission they earn

BY ADAM PINCUS In the cutthroat world of NYC office leasing and investment sales, brokerages regularly try to best each other Top investment sales firms and win over new clients. But which and amount sold in 2012: firms actually do the most business? Eastdil Secured: $7B This month, TRD culled together thousands of deals to find out, and CBRE Group: $3.5B also conducted a first-ever estimate Jones Lang LaSalle: $2.09B of how much in commissions those Massey Knakal: $2.05B deals yielded for firms. Rosewood Realty: $1.4B See story on page 36

High Line copycats New York City’s High Line is now spawning copycats globally, with cities like Atlanta and Singapore converting defunct rail lines into public parks. See page 18. St. Patrick’s Cathedral

NYC’s holiest air rights

A behind-the-scenes look at religious institutions lobbying the city to be included inside the pearly gates of a proposed Midtown East rezoning district. The move would allow them to cash in on lucrative air rights. See page 52.

More co-op board members get served Cases at the Dakota and other high-profile apartment towers are making board members fearful of being personally targeted by lawsuits. See page 38.

www.TheRealDeal.com

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Highlights NURSERY SCHOOL

M A R C H

2 0 1 3

Bidding gets ‘absolutely insane’

New ad regulations to hit brokers

High Line copycats

Bidding wars for residential properties are going to the next level, brokers say.

State finally gets close to revamping marketing rules to deal with Internet.

Manhattan’s favorite elevated park has spawned replicas across the globe.

18 The High Line on the Far West Side

Greystone’s golden boy The CEO of the lender and investment firm Greystone, Stephen Rosenberg, took the long route to real estate with stopovers in dentistry and Talmudic studies. Stephen Rosenberg, Greystone’s founder and CEO

With 10,000 species of plants, century-old Brooklyn Botanic Garden needed a visitor center to teach its more than 1 million visitors each year about horticulture. As green as its mission, the center’s undulating glass curtain wall delivers high performance, minimizing heat gain while maximizing natural illumination. Skillfully integrated with park surroundings by architects Weiss/Manfredi, its organic transparency offers inviting respite between a busy city and a garden that has a lot of growing—and teaching—left to do.

Transforming design into reality

This month’s funniest and most insightful real estate–related comments.

Siegel 26 Shadowing A day in the life of CBRE megabroker Stephen Siegel as he attends WTC leasing meetings and does his regular lunch at the Friars Club.

26 Stephen Siegel

The next Lincoln Center?

Solow’s strategy

FHA fees pack a punch

For help achieving the goals of your next project, contact the Ornamental Metal Institute of New York.

Publisher of Metals in Construction 211 E 43 ST | NY, NY 10017 | 212-697-5554 | www.ominy.org

In their words...

Mapping out the bevy of new residential projects around BAM.

The litigious landlord’s recent land sales have some saying he’s in liquidation mode; others disagree.

Columnist Ken Harney on why FHA loans are getting more expensive.

30 Real estate mogul Sheldon Solow

new flood zone 32 FEMA’s In wake of Sandy, agency adds thousands of NYC properties into the danger zone.

Architect: Weiss/Manfredi Architecture/Landscape/Urbanism Photographer: Albert Veˇ cerka

34 MMJ’s founders Jeffrey Jackson, left, and Steven Knobel.

6 2013 8 March October 2012www.TheRealDeal.com www.TheRealDeal.com

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appraisal firm hits the skids 34 Big A behind-the-scenes look at how Mitchell, Maxwell & Jackson went from flying high to teetering on the brink.

www.TheRealDeal.com March 2012 00

2/28/13 10:15 PM

2012 Closings S ince 2005, we have invested in excess of $1 billion in the origination and acquisition of commercial mortgage loans collateralized by multifamily, retail, office and light industrial properties throughout the United States. $23,500,000

$22,000,000

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Distressed Note Acquisition Multifamily Property Brooklyn, NY October 2012

New Loan Origination Multifamily/Retail Property Soho - New York, NY September 2012

Distressed Note Acquisition Multifamily Property Brooklyn, NY May 2012

Note Financing Multifamily Property Brooklyn, NY December 2012

$12,640,000

$9,950,000

$7,023,000

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Distressed Note Acquisition Multifamily Property Staten Island, NY May 2012

Distressed Loan Pool Acquisition Multifamily/Retail Properties Brooklyn, Bronx & Queens, NY June 2012

Distressed Note Acquisition Retail / Office Property Queens, NY November 2012

DPO Financing/Construction Loan Retail Property Queens, NY April 2012

$6,375,000

$6,340,950

$5,750,000

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Distressed Loan Pool Acquisition Multifamily Properties Brooklyn, NY June 2012

Distressed Note Acquisition Multifamily Property Brooklyn, NY September 2012

Note Financing Multifamily Property Queens, NY December 2012

Distressed Loan Pool Acquisition Multifamily/Retail/Industrial Brooklyn, Manhattan & Queens, NY April 2012

$5,428,638

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Distressed Note Acquisition Mid-construction Multifamily Property Manhattan, NY November 2012

Distressed Note Acquisition Mixed-Use Building Brooklyn, NY February 2012

Distressed Loan Pool Acquisition Multifamily/Industrial Properties Brooklyn, NY December 2012

Distressed Loan Pool Acquisition Multifamily Properties Manhattan, NY July 2012

$3,750,000

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Note Financing Flex/Industrial Building Long Island City, NY February 2012

Distressed Note Acquisition Mid-construction Retail Property Staten Island, NY July 2012

Distressed Note Acquisition Industrial Property Brooklyn, NY May 2012

Distressed Note Acquisition Multifamily Property Brooklyn, NY September 2012

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(646) 472-1900 • www.madisonrealtycapital.com Includes deals closed by Sullivan Realty Capital, LLC, an investment adviser registered with the Securities and Exchange Commission doing business as Madison Realty Capital, and its affiliates. Past performance does not guarantee future results. It should not be assumed that the recommendations made in the future will be profitable or will equal the performance of the securities listed. Holdings are subject to change.

Highlights continued 40

up commercial firms 36 Stacking A first-ever ranking of brokerages by investment

COURT ROOM

sales deals, office leases and commissions earned.

MaryAnne’s moment

Order in the court

The Forest City Ratner exec could be elevated to CEO this month, and industry sources say they expect big things.

Meet the small club of real estate pros who work as (well-paid) expert witnesses.

Forest City Ratner’s MaryAnne Gilmartin

Brooklyn’s building bonanza A breakdown of the residential buildings coming down the pike. Two words: Big rentals.

This month in real estate history The famed Haymarket club closes amid red light district crackdown.

A state-of-the-art arena with unparalleled sightlines and an interior environment as dynamic as its sculptural exterior, Barclays Center is New York’s first major new entertainment venue in nearly a half century. But while the arena’s unique steel paneled facade may stop traffic outside, it’s the elegant long span steel roof structure inside that enables crowds to enjoy column-free views of show-stopping performances. Architects SHoP and AECOM with structural engineer Thornton Tomasetti made sure that, long after its first sold out performance, Brooklyn would have a new living room where every seat is always the best seat in the house.

Structural steel Right for any application For help achieving the goals of your next project, contact the Steel Institute of New York.

Houses of the holy Religious institutions are lobbying to get inside the pearly gates of a new Midtown zoning district to cash in on air rights. Monsignor Robert Ritchie at St. Patrick’s Cathedral

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

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

National Market Report Reports from around the country on significant developments and trends. A micro-unit model at the Museum of the City of New York

macro look at micro-units 57 ADevelopers say tiny apartments are good business, but zoning changes are needed first.

116

Publisher of Metals in Construction 211 E 43 ST | NY, NY 10017 | 212-697-5553 | www.siny.org

Cooking up more than lawsuits

Attorney Craig Gambardella on the TV show “Bobby’s Dinner Battle”

Arena Design Architect: SHoP Architects Arena Architect: AECOM Design Builder: Hunt Construction Group Structural Engineer: Thornton Tomasetti Photo: Bess Adler

Residential Market Report

Real estate attorney Craig Gambardella is starring on celeb chef Bobby Flay’s new cooking show.

Closing: Izak Senbahar 118 The The president of the Alexico Group talks about his rebellious roots and his real estate ups and downs.

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

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

108

Calendar of Events Check out this month’s activities.

114

Comings & Goings The stories behind the latest job moves and company announcements.

116

We Heard A lighter look at industry buzz.

8 March 2013 www.TheRealDeal.com 10 October 2012 www.TheRealDeal.com

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DIRECTOR OF DIGITAL MARKETING AND STRATEGY Amir Talai ADVERTISING SALES Eran Evron, Abi Laoshe, Nick Mascaro, Robert Stearns, Jennie Durkovic WEBMASTER Nima Negahban FINANCE DIRECTOR Kenneth Cyrus ADMINISTRATOR Junaid Zahid ADMINISTRATIVE ASSISTANT Virginia Durso CIRCULATION Paul Destanko DISTRIBUTION Mitchell Newman, Michael Presto ATTORNEY Barry J. Friedberg Trachtenberg Rodes & Friedberg LLP ACCOUNTANTS William T. McCallum, CPA, P.C., Christine Wang The Real Deal is a registered trademark of Korangy Publishing Inc. Copyright © 2013. 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.

10 March 2013 www.TheRealDeal.com

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An ode to ‘Only in New York’

nly in New York, kids. That was the slightly hokey catchphrase of former New York Post gossip columnist Cindy Adams in chronicling the city’s social scene. But it definitely applies to real estate here — as you’ll see in this month’s issue. The sheer lack of available real estate in New York City and its dramatic cost is no secret. But it’s remarkable how the lack of space in New York is a catalyst for unique “Only in New York” innovation. Where else would someone come up with the idea to take a derelict elevated railway line and convert it into a 1.5-mile-long park hovering above the city? Of course, I’m referring to the High Line, which is finishing up its third and final section next year. The project — which has prompted the development of 29 new nearby buildings and $2 billion in private investment — is spawning more than a dozen copycats around the world, from Germany to Jerusalem, Mexico City to Singapore (not to mention closer to home in Jersey City, the Lower East Side and Queens). We examine the burgeoning ranks of imitators on page 18. It also makes sense that the densest city in the country is becoming a leader in the micro-apartment craze. Those affordable shoebox-size dwellings will allow more people (particularly young people) to live in the city if they’re willing to sacrifice space for location. The trend got a big boost recently when Mayor Bloomberg announced the winner of a design competition. The winning team will erect a building on East 27th Street to house units ranging from 250 to 370 square feet. Private developers entered the contest in record numbers. That might not be surprising, considering these buildings could net higher per-square-foot returns than traditional apartments, as we examine in a story on page 57. (Still, my ultimate real estate fantasy is the opposite of the micro-unit. It was spurred by a story we did on the homes of tech moguls a few months ago and features

Only in New York would land abutting a Superfund site be gobbled up by investors, as is happening today around the Gowanus Canal. In most areas of the country, a padlocked gate would have been placed around the putrid body of water. a young idealistic tech entrepreneur, worth a few billion dollars, buying the entire floor of a massive industrial building in Chelsea. The space would be entirely open, except for a few structural columns, and would be furnished with only a bed and standing lamp, with piles of books spread out on the floor to complete the scene.) Another “Only in New York” situation is unfolding around the Gowanus Canal, where the land abutting a Superfund site is being gobbled up by investors, a massive new development is being planned and townhouse prices are surpassing $1 million amid a hipster retail transformation. In most areas of the country, a padlocked gate would have been placed around the putrid canal (which is also susceptible to flooding, as Hurricane Sandy showed). Check out our coverage on page 63. Meanwhile, in our lead cover story, we surveyed all the major residential projects in the works in Brooklyn — in Gowanus and beyond. While there was a lull during the recession, building is coming back strong, with more megaprojects and capital heading to the borough than before. Check out the story starting on page 46. Rounding out the issue, we also look at the biggest pending rule changes for real estate advertising in nearly two decades (page 16); survey the dire state of the appraisal industry by looking at the fall of one of the city’s largest appraisal firms, Mitchell, Maxwell & Jackson (page 34); and do a first-ever survey of commercial brokerages and total commissions earned by each firm (page 36). Finally, I’m proud to announce that The Real Deal won an award for general excellence for a print magazine from the Society of American Business Editors and Writers last month. The category covers print magazines of any size, so we had some pretty stiff competition. I’d also like to congratulate Leigh Kamping-Carder, who was promoted from deputy web editor to web editor this past month, and welcome Melanie Gray, who recently came on board as our editorial development director from the Daily. She will spearhead the magazine’s South Florida coverage and our newest publication, Luxury Listings, as well as help work on the New York issue and website as we aim to bring you the most compelling real estate stories each month. Enjoy the issue.

The Corcoran Group is a licensed real estate broker. Owned and operated by NRT LLC.

Stuart Elliott 12 March 2013 www.TheRealDeal.com

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Bidding gets ‘absolutely insane’

Brokers say bidding wars are now taking place in the majority of deals as market heats up amid tight inventory BY HAYLEY KAPLAN ith a continued inventory shortage and interest rates still low, bidding wars have emerged as the new norm for increasingly desperate buyers, industry experts said. And while sellers rejoice as prices get bid up, brokers struggle to please frustrated clients. Bidding wars have been prevalent for some time. But lately, brokers said, multiple bids and “best and final” negotiations — in which all of the potential buyers simultaneously submit their final offer and the seller chooses between them — now take place in the majority of deals. Howard Margolis, an executive vice president at Douglas Elliman, said the number of bidding wars he’s witnessed is “absolutely insane.” In one instance, three different parties made offers on an apartment during a single open house, he said. Other brokers shared similar stories. Bill Bone, a broker at Bond New York, said a buyer he was representing recently lost out on a new condo in Williamsburg af-

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that the final selling price will likely come up,” Bone said. And it’s not always the highest bid that wins. With lending standards still tight, many sellers prefer to take all-cash offers over the highest bidder. “In many cases, the cash deal even trumps the higher bidder,” said Jessica Cohen, a Elliman broker. “I have had many buyers who lost their deals because a cash bidder jumped ahead of them — and not at a higher offer.” Perhaps not surprisingly, working with potential purchases under such competitive conditions is stressful, brokers said. “In this market, just when you think that you have the best possible deal on the table — not only related to price but also terms — somebody else comes to the table with a better offer,” said Jacky Teplitzky, a managing director at Elliman. “This can be dangerous during the negotiation process, as people get frustrated, heated and [sometimes] even walk away.” David Kazemi, a broker at Bond, said

Bill Bone, a broker at Bond New York, said a buyer he was representing recently lost out on a new condo in Williamsburg after “we had to compete with 45 other offers.” ter “we had to compete with 45 other offers.” Jonathan Miller, CEO of the appraisal firm Miller Samuel, said the uptick in bidding wars is “the byproduct of low inventory.” As The Real Deal has reported, the number of available Manhattan listings in the fourth quarter of 2012 dropped 34.2 percent to 4,749 from 7,221 in the same quarter of 2011, according to a Douglas Elliman market report prepared by Miller. That figure had risen slightly to 4,860 units in January, Miller said. Often, bidding wars result in buyers paying more than the asking price. One of Bone’s other buyers, for example, recently beat out seven other bidders in a bestand-final negotiation for a newly converted condo at 206 Montrose Avenue in Williamsburg. Although Bone declined to specify exactly how much the buyer paid for the unit, he said the price was around 10 percent above the $400,000 asking price. But it’s not clear that bidding wars alone increase home values, since some buyers react to bidding wars by looking for lowerpriced homes. “To ensure my buyers can play by today’s rules, I guide them to look in a price range below their target, knowing full well

some of his clients have been “utterly frustrated” by the competitive atmosphere. In fact, one potential client “removed himself from the market” after seeing a rotation of 30 people in 15 minutes at an open house, Kazemi said. Agents have had to develop new strategies to aid these disheartened clients. “Brokers are making sure that customers are well aware of the fact that they have to act fast, ask fewer questions and place a bid close to [the] asking price if they want to have a chance at getting what might now be a rare apartment,” said Janice Silver, an executive vice president and sales manager at Bellmarc Realty. But that’s easier for experienced brokers than for rookie agents, sources said. “Brokers who have been in the business a long time — those are the ones who are successful right now,” Margolis said. “It’s not [a business] for the faint of heart.” TRD

Follow The Real Deal on Twitter: twitter.com/trdny

14 March 2013 www.TheRealDeal.com

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An ad overhaul group next convenes. If that happens, the changes would go into effect around mid-June, marking the biggest regulatory shakeup in real estate advertising in 19 years. In October, the committee agreed on the proposed rule changes — which dictate how New York City brokers will have to treat all forms of advertising, from web and e-mail promotions to business cards and more traditional mediums like signs and flyers. If the committee doesn’t adopt those changes within 12 months,

By Tom Acitelli ew York State is getting closer to finally overhauling the rules for advertising in the real estate industry — a move that would change the way brokers use social media and even what brokers can name their own teams. Sources close to the 14-member New York State Board of Real Estate, the government oversight committee debating the rules, say new regulations could be adopted as soon as March 14, when the

Big changes to state marketing rules aim for greater transparency in real estate advertising

the proposed rules expire and it has to go back to the drawing board. Sources who spoke to The Real Deal said, however, that they were fairly confident the new rules would be adopted this month. For brokerages, the impact of the rule changes would be manifold. Among the most dramatic changes, broker teams, which have become popular in recent years, would be prohibited from calling themselves “groups,” or from using the terms realty or as-

sociates in their names. Instead, the rule — which is backed by the Real Estate Board of New York, the industry’s leading trade organization — would require groups use the word team. (The idea is to avoid giving the impression that they are an independent company rather than a team within a larger firm.) In addition, if nonlicensed members of the team are named in ads, the material must specifically state who is licensed and who is not.

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Titles like “sales associate,” “agent” and “broker” would also be out — with ads indicating the exact license held by the broker, such as “licensed real estate salesperson” or “licensed associate broker.” Moreover, only a licensed broker would be allowed to place an ad without citing the name of his or her brokerage; everyone else (including teams, associate brokers and salespeople) must include the brokerage name or the broker their license is affiliated with. Several members of the committee, including Halstead Property’s president Diane Ramirez, either declined to comment or did not respond to requests for comment. The Department of State, which would implement the rules, would only confirm that the proposal will be on the agenda at the March 14 meeting.

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Since the rules were last substantially overhauled in 1994, a lot has changed. For starters, neither the Internet nor broker teams were commonplace in the industry back then. Today’s proposed changes are designed to incorporate those new realities when it comes to holding brokerages more accountable for the online and print actions of their brokers. “It’s a big deal,” said industry veteran Neil Binder, president of Manhattan-based residential brokerage the Bellmarc Group. Most brokerages “understand they’re not getting off the hook, and they better make sure they can properly direct and control [their broker teams],” he said, so that the teams “conform to the legal and ethical practices of the state.” Running afoul of existing guidelines can already result in the loss of licenses for brokers and their firms along with tens of thousands of dollars in state penalties (particularly when it comes to Fair Housing rule violations). But the new regulations increase the likelihood of that happening because they’re more stringent. Firm heads who spoke to TRD appear to be taking a hands-on approach to the pending changes through training and through installing filters on their websites to weed out any noncompliant postings. “What [the state is] really tryContinued on page 102

16 March 2013 www.TheRealDeal.com

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High Line history

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Copycat projects

The Lowline

The Embankment

QueensWay

Mushroom mile

In 1999, the Friends of the High Line began lobbying to redevelop 1.45 miles of elevated rail line on Manhattan’s West Side. Twelve years and some $152 million later, the ﬁrst two sections of the High Line opened. The $90 million, third section is slated to open in 2014. Some 29 developments have been — or are being — built alongside the High Line. The park has prompted more than $2 billion in private investment, 2,558 new residential units, 1,000 hotel rooms and more than 423,000 square feet of office space. Between 2003 and 2011, nearby residential property values grew 103 percent. (NYT) The High Line, which attracts 3.7 million visitors annually, has inspired more than a dozen rail line renovations globally, including the LEGO Bridge, pictured, in Germany; Jerusalem’s Railway Park; the Chapultepec Project in Mexico City; the BeltLine in Atlanta; and the Green Corridor in Singapore. (Hufﬁngton Post) The proposed Lowline would convert a Lower East Side trolley terminal last used in 1948 into an underground park. The project could cost up to $72 million, but is expected to increase property values and could generate $5 to $10 million in tax revenue over 30 years. (WSJ) Advocates want to turn the Embankment, a derelict stretch of railroad tracks in Jersey City, New Jersey, into a park, but development of the site has now been stalled by litigation. (WSJ) Late last year, the state funded a feasibility study for a plan to convert 3.5 miles of the abandoned Rockaway Rail Line into an elevated park known as the QueensWay. But critics of the project — which would stretch from Rego Park to Ozone Park — would rather see the line reactivated for public transportation at an estimated cost of $500 million. (DNAinfo) Near the end of last year, London sponsored a design competition for a High Line–style park. The winner, Fletcher Priest Architects, proposed a plan to transform London’s old Mail Rail tunnels into an underground mushroom garden called Pop Down. (Londonist)

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This bronze sculpture by American sculptor Tom Corbin is one of more than a dozen owned by Greystone, which employs a full-time interior designer to decorate its 17 offices nationwide. “[But], there is rarely a [decorating] decision I am not involved in,” Rosenberg said.

Rosenberg switched career paths several times before getting into real estate at 29. He also went to dental school at the University of Pennsylvania and simultaneously earned an M.B.A. at Penn as well. Rosenberg opted not to pursue dentistry because his salary was predicated on how many patients he could see in a day. “I wasn’t comfortable with that limitation and, also, I wasn’t very good at [dentistry].”

Greystone operates its own charitable arm. This DVD was filmed for the company at an orphanage the organization built in 2008 in AIDS-ravaged Cameroon. Greystone gives away “an illogically high percentage of our income,” Rosenberg said, usually donating 30 to 40 percent of its gross annual profits.

tephen Rosenberg, the president and CEO of Greystone, founded the real estate lender and private investment group in the back of a friend’s music store in 1988. Today, the company has some $15 billion under management and 5,000 employees nationwide, including 150 in New York. The company is also the nation’s largest originator of multi-family loans insured by the U.S. Department of Housing and Urban Development. While in the past, Greystone did the bulk of its business outside New York, its recent acquisition of the Bassuk Organization, an investment bank that caters to high-profi le New York developers — such as the LeFraks and the Rudins — will mean an expansion of the business here. The fi rm is “actively working on several hundred million dollars of New York business,” mostly in fi nancing, said Rosenberg, whose offi ce is on the 60th fl oor of Carnegie Hall Tower on West 57th Street. B Y G UELDA V OIEN

020 march desk of se FINAL.indd 1

PHOTOGRAPH FOR THE REAL DEAL BY CHRIS MARTIN

THE

DESK

OF:STEPHEN

This watch belonged to Rosenberg’s father, a “serial entrepreneur,” who died father when Rosenberg was 17. Still, Rosenberg maintained his dad’s charitable ethic. When he was a kid, his dad forced him to take groceries to the elderly and disabled. “I hated those trips,” he said. “Those people smelled. But I think that upbringing really instilled a sense of ‘it’s not about you.’ ”

Rosenberg studied religion in his twenties at a yeshiva school in Memphis, and then at Yeshiva Chaim Berlin in Brooklyn. These Hebrew texts hearken back to the days when he studied the Talmud “15 to 17 hours a day,” he said. He left because “I did not feel that I could become a worldclass scholar; I could be good, but not great.”

ROSENBERG

These rocks and semi-precious stones were gifts from a friend and client who collects them: Ofer Manashe, president of Houston-based Sandstone Construction. “He just doesn’t stop sending me stones,” Rosenberg said, chuckling.

Rosenberg has five sons in their twenties, and one nine-year-old daughter. Although all five boys work at Greystone, he said he didn’t push them into the business, having learned the hard way that finding a satisfying career is not easy. “I went straight to Wall Street after dental school, and I wasn’t really a great associate,” said Rosenberg, who worked with investment bank A.G. Becker and stock brokerage Dean Witter, where he headed up real estate finance.

This conference room is available to all Greystone employees, but everyone at the firm — including Rosenberg — sits down the hall in an open bullpen. When he wants privacy, “I just switch to Hebrew,” said Rosenberg, who was raised in a modern orthodox Jewish family in Miami.

This painting, by Jennifer Cawley, was bought by Greystone in 2006. Rosenberg liked it because it was done using an unconventional medium: wax. He said of all the décor in the office, it tends to attract the most attention.

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Commercial Ma r k e t

Little hope for spring season

Office leasing market stagnates, but brokers say they expect to see a pickup later in 2013 By Adam Pincus espite the large lease extension signed by Macy’s in Midtown’s Penn Plaza district, prices and availability in the Manhattan office market remained stagnant last month. And insiders predict that conditions will remain flat

for the next few months. “The general thinking in the brokerage community is that the first half of the year will be flat, with a pickup and growth in the latter half of the year on an accelerated basis into 2014,” said David Greenbaum, president of the

New York City Office Division of Vornado Realty Trust, during the firm’s fourth-quarter earnings call last month. Indeed, Manhattan’s average asking rents barely budged last month — falling 9 cents to $60.96 per square foot from January. The

availability rate — which tracks space that’s vacant now or will be in the next year — ticked up 0.1 points to 11.8 percent, according to figures from global commercial firm DTZ. “Leasing is slow and steady,” said Chris Helgesen, a managing director in the New York office of DTZ.

Midtown

The largest reported office deal last month in CoStar Group’s database was the 646,000-squarefoot lease extension between Macy’s and Vornado at 11 Penn Plaza. Meanwhile, in another Vornado building — the 2 millionsquare-foot 1290 Sixth Avenue

Manhattan office stats AVAILABILITY RATE

AVG. ASKING RENT

Manhattan Feb ’13 11.8% $60.96 Jan ’13 11.7% $61.05 Midtown Feb ’13 12.0% $70.94 Jan ’13 11.8% $71.20 Midtown South Feb ’13 9.4% $49.00 Jan ’13 9.3% $48.97 Downtown Feb ’13 13.0% $41.60 Jan ’13 13.0% $41.45 Source: DTZ

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Midtown South The Hudson Yards area of Midtown South is shaping up to be something of an office-leasing battleground, with the Moinian Group, Extell Development, the Related Companies and Brookfield Office Properties hunting for office tenants.

Matt Petrula mpetrula@mtb.com Dan Shields dshields@mtb.com 212-350-2000

— insurance firm AXA Equitable listed five floors on the Midtown sublease market, CoStar showed. AXA, which is being represented by Jones Lang LaSalle, did not disclose an asking rent. But Greenbaum said the company’s lease, which was originally struck in 2007 and runs through 2023, has a higher rent than Midtown’s current average. In July, as part of the lease deal, AXA’s rent jumped from about $45 per square foot to $88, he said. By comparison, the average asking rent in Midtown last month was $70.94 per square foot, down 26 cents per square foot from January, according to DTZ. The availability rate rose last month by 0.2 points to 12 percent. The stalled leasing market is causing alarm among tenants and brokers trying to figure out their next moves. Helgesen said he’s representing a law firm that has about 80,000 square feet in the Plaza District with four years left on its below-market, $60-per-squarefoot lease. The firm is trying to decide whether to renew — and hedge against possible future rent spikes in the Plaza District — or ultimately move. “My recommendation is to wait,” he said. “It may go to $90 [in the Plaza District], but you always have the release valve to move to another section of Midtown that won’t be as heated.”

2/25/2013 3:14:38 PM

Continued on page 94

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In their words...

The month’s funniest and most insightful comments on real estate

“I am happy about that because I know it means they’re going under. The bottom line is, if you don’t have an office, you don’t have a business. As far as I’m concerned, you’re a step above a hobby.”

Bill Thompson, a front-runner for mayor, on the proposed plan to build luxury high-rises on NYCHA property. (New York Daily News)

Neil Binder, principal of the Bellmarc Group, on how he reacts when he hears that another firm has a virtual office.

“It practically came out and took the food from my hand, so I figured that was a good sign. It was 20 degrees outside. I couldn’t leave it out there in the cold. It wouldn’t have survived the night. The other rats would have killed it. … They’re very clean animals, despite what people think.” Douglas Elliman broker Sonia Stock, on providing shelter for a domestic white rat she found outside her home in Tribeca.

“The city has a long history of giving away the store to powerful people in real estate. You have to be extremely careful.” Sen. Liz Krueger, a Democrat from the Upper East Side, in reference to a proposed tax subsidy for landlords. (The New York Times)

“We would be going out to open houses, and there would be 80 people going in and they’d be asking $740,000, and it would suddenly go to $940,000 — all cash. And you’re still two blocks away from the sewer plant in Greenpoint. We just thought, ‘What are we doing?’ ” Artist Patrick McNeil, on his family’s decision to move from Brooklyn to the suburbs. (The New York Times)

“When there’s just a desperate need for affordable housing, this is just a bonehead move.”

“Wait, how would an East Village three-bedroom sell for $550K? Clearly a former murder scene, right?” Heidi Moore, the Guardian’s U.S. Finance and Economics editor, reacting to a New York Times story about apartment hunting in the East Village. (Twitter)

“Yes, of course, Canada has a real estate bubble. But it is a very polite real estate bubble.” Investment advisor Josh Brown, author of the Reformed Broker blog. (Twitter)

“It’s not doable for small churches to survive on the contributions of their congregants anymore.” Rev. John Merz of Greenpoint’s Church of Ascension, on a real estate deal to turn the top two floors of its parish hall into apartments. (DNAinfo)

24 March 2013 www.TheRealDeal.com

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DAY IN THE LIFE OF:

Stephen Siegel

CBRE’s global chairman keeps a rigorous schedule, from leasing buildings at the WTC site to his regular lunch at the Friars Club

2 P.M. The afternoons are for calls and e-mails. I also try to

see my daughter, Cassandra, who’s in CBRE’s “Wheel Program,” a 12- to 16-month program for recent graduates to 5:45 A.M. I set the alarm for 6, but I wake up naturally right

experience different jobs at the firm. She graduated from

before it goes off. I don’t eat breakfast most days, just coffee,

Dartmouth last year as an environmental science major and

but when I have breakfast meetings out, I order a feta, toma-

4 World Trade Center, where CBRE is the exclusive leasing agent

said, “Let me try business before I save a whale.” I text her,

to and spinach omelet. I love those Greek omelets. If I get

“Do you have two minutes to meet me at the elevator for a

to choose the place, I pick Café Centro, which is in my office

hug?” A few weeks ago, I spent the afternoon out in Brook-

building at 200 Park Avenue. For people coming in from

lyn with my son, Jared, who launched his own development

Connecticut or Westchester, it’s also close to Grand Central.

firm in January, Siegel Development. We went to look at

Mornings are also for papers; online news just doesn’t do it.

a small project, an apartment building with 10 or 12 units.

I like the feel of the newspaper, turning the paper and pick-

He wanted to buy it and rehab it, but there was an existing

ing up little tidbits. I read the New York Times and the Daily News at home, and the Journal and Post later in the office. I

contract on it. It was our first deal out of the box, and we Lee Neibart, the CEO of AREA Property Partners and Siegel’s close friend

needed a cleaner deal, so we let it go.

like the Post for gossip. 6 P.M. I go out three to four nights during the week — there 7 A.M. I used to be a gym rat; I’d do something every day.

are a lot of charity events. My charitable streak probably

But now I work out just a couple of times a week. I prefer the

came from my mother, who was a school crossing guard in

Equinox in the Graybar Building, since I can get there un-

the Bronx for 16 years. She would bring home kids who had

derground from my office. I will do the treadmill, some light

no lunch and feed them a cheese sandwich. One of the big

weights and some crunches for about 40 minutes.

events I was involved in recently was for National Jewish

8:15 A.M. If I go to the gym, I’ll be in the office around 8 or

The Friars Club, which Siegel joined a few years ago

Health, one of the best hospitals for respiratory and immunology in the world. We raised $1.75 million at an event in

8:15. But once or twice a week, my car and driver will pick me

December. It was amazing. [My wife] Wendy did 80 percent

up at home around the same time and I’ll go directly to the

of the planning for the event from a hospital room, since she

World Trade Center site for a lease meeting. Building 7 is all

was diagnosed with leukemia a year ago. I said, “Wendy, you

leased up, but there are still 6 million square feet available

don’t have to do this,” and she said, “Yes, I do.” Not only did

between buildings 3 and 4 [CBRE is the exclusive agent for

she show up, she danced at the party. At the moment, she’s

all three buildings].

in remission, and, God willing, that’s where she will stay.

12:30 P.M. A couple of years ago, I became a member of

Mustard packets for Siegel’s regular Chinese lunches

10 P.M. I love sports and will watch anything, though base-

the Friars Club. On Thursdays they serve what I call “high-

ball is my first sport. I’m a partner in a minor-league team,

school chicken chow mein,” so I stop at a Chinese restaurant

the Tri-City ValleyCats, in Troy, N.Y., that used to be affil-

on the way and grab hot mustard packets. I offer a dollar,

iated with the Mets, but now is with the Houston Astros.

but they say, “Just take it, take it.” I don’t drink alcohol, so I

I actually hate the Yankees, even though I grew up in the

have a Diet Coke with two limes. I have to tell the waiters

Bronx. My dad was a New York Giants [baseball] fan, and

“the green ones” or they will bring me lemons. Yesterday, I

when they left for California, we switched to the Mets because they were also a National League team.

had lunch with Lee Neibart [global CEO of AREA Property Partners, formerly called Apollo Real Estate Advisors].

Siegel is a partner in the Tri-City ValleyCats, a minor league baseball team

We’ve been friends for 30 years, since his days as a leasing

11 P.M. When Wendy and I are at events, we’re running

agent in Westchester. When Apollo [and Jamestown] sold

around, so at 11 we finally have time to catch up on the day

1290 Avenue of the Americas in 2006 to a group of Hong

and watch conventional television, like “Law & Order” or

Kong investors for $1.25 billion, I was an agent on the deal.

“Homeland.” I don’t usually fall asleep till 1 a.m. Five hours

A year later, the investors sold the building [to Vornado for

of sleep is enough for me; six is a luxury. By C. J. Hughes

about $1.3 billion], and I was on that deal, too. The logo for “Homeland,” one of Siegel’s regular TV shows

26 March 2013 www.TheRealDeal.com

026 A Day in the Life- Siegel se FINAL.indd 1

March 2012 00 PHOTOGRAPHwww.TheRealDeal.com OF SIEGEL FOR THE REAL DEAL BY MICHAEL TOOLAN

2/27/13 10:06 PM

ON THE MOVE Perspectives on Running a Real Estate Brokerage Business Neil Binder formed Bellmarc in 1979 and has observed many firms rise and fall since then. His former competitors have sold to investors and to national companies, or ceased doing business, or seen their original owners retire. Not only has Neil outlasted them, he has steered his company into new territory, adapting and evolving to meet rising challenges. His experiences over these tumultuous decades shaped his philosophy about the home market and the brokerage business. Olinda Torturro, Director of Recruiting for The Bellmarc Group, asked Neil for his insights on some of the important issues of the day. OLINDA: We know that technology has changed the way we do business. Where do you see its role in real estate brokerage going forward? NEIL: You can’t survive in this business without technology. However, most firms subscribe to a standard technology platform or buy generic software to service their needs. This forces a company’s business practice to conform to the program’s limitations. I believe that the computer system must work for the company, not the other way around. As to where technology is going, I know the iPad is a real part of the future. It gives the agents immediate access to the entire listing book in an easy format. We are dedicated to building software technology to exploit this. I also know that the best technology is yet to come.

ing their environments than managing them. Administering ensures that the motor is fined tuned and working properly, while managing means getting behind the wheel and going somewhere. They are very different. In real estate, a manager must constantly be thinking about how to serve customers and clients better; an administrator must constantly be thinking about how to make the sales people happy. They are both critical elements to the business. OLINDA: Most firms hire an outside professional to train its sales people. Why do you take a direct role in training your agents? NEIL: The essence of any sales company is the competence of its sales force. Training, therefore, is not merely a marketing tool or a hook to attract prospective new recruits, but a vigorous pursuit where there is urgency for excellence. The key is to understand this and to recognize that a well-trained agent is an entrepreneur; the company is only providing tools to expand the opportunities for the

THE

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OLINDA: A trend has emerged in newer firms to offer very high commissions. Is this practice here to stay? NEIL: The firms that offer high commissions are doing so with a strategy. They believe that such lofty commissions will more than compensate agents for the payment of a monthly desk fee and the loss of the usual services like advertising and promotion, administrative help and management support. A business model that centers on a desk fee rather than a commission is not the same as the business I am in. Support for the agent makes a huge difference in the level of production; it is why most agents find that high-commission firms don’t fulfill their fundamental business needs. OLINDA: Bellmarc has traditionally worked all ends of the market. What is your view about specialization, especially in the high end? NEIL: Typical agents tell you they want to specialize in high end. Who wouldn’t? But the population of buyers and sellers are 95% middle market and low end. My philosophy is first to earn a living and then to make money. An agent should first generate production, then broaden into other prospects. The high end is no harder than any other market segment; however, you must be sure you can afford the entry fee. It requires a long-term investment to make your reputation and create a business, rather than just taking a shot and hoping it pays off. OLINDA: Can real estate brokerage remain relevant as web sites become a dominant tool for consumrs? NEIL: Real estate brokers are more relevant now than at any time I have been in the business. Sellers are confused about how best to market their property. Buyers are confused about how to filter the vast quantities of data available. The broker’s role has changed from being accumulators of information to definers of information. We must provide a value-added service in helping the customers and clients make intelligent decisions.

BELLMARC

OLINDA: Bellmarc continues to lead in print advertising while others concentrate on web advertising. Are you considering a shift as well? NEIL: The purpose of advertising is to create awareness of either the company or of a particular property. In effect, the customer is saying, why should I call you? I view advertising as an invitation to the buyer, and as such it needs to look impressive. If you invite me to an important event with an invitation that is not compelling, it tells me that my presence doesn’t matter to you. Bellmarc has distinguished itself with stand-out print advertising, and print is still relevant to millions of people. But it is merely one medium where people will look for products and services. The web is now the main source of advertising for most firms. While it is a critical component, like print, it is only one component.

Olinda Turturro explores The Bellmarc Group philosophy in an insightful conversation with Neil Binder

OLINDA: There are many different models of real estate brokerage sprouting up, especially in light of the recession. How has managing a brokerage changed? NEIL: Managing is like cooking in the outdoors on an open fire. The wind will vary, the logs are unstable and the fire’s heat is hard to control. However, the chef knows that he has a job to do and that everyone must eat! Management is about being dynamic and yet keeping your eye on the objective. The problem with most managers is that they focus more on administer-

agent to express creative greatness. I dedicate myself to training agents because I am entering into a partnership with each and every one of them.

| BELLMARC SALES www.bellmarc.com

BELLMARC BELLMARC

The next Lincoln Center? The BAM cultural district sees a bevy of new residential construction BY ANDREW KLAPPHOLZ or years, the Bloomberg administration has been trying to revitalize the down-at-heel area around Fort Greene’s Brooklyn Academy of Music (widely known as BAM). Now, those efforts finally seem to be gaining traction, with a bevy of new residential buildings underway. The so-called Downtown Brooklyn Cultural District — between DeKalb and Atlantic avenues — is even drawing comparisons to Manhattan’s now-pricey Lincoln Center neighborhood. “Think about what happened at the Lincoln Center area in the ’90s — that’s what’s happening to the BAM center now,” said Melissa Pianko, executive vice president of development at the Gotham Organization, which is developing 600 units of housing with DT Salazar on a site bounded by Fulton Street, Rockwell Place and Ashland Place. Since 2004, the city has spent more than $100 million in the Downtown Brooklyn Cultural District on new facilities, public spaces and affordable housing projects. That includes the new BAM Fisher Building, which opened in 2012. And the district will soon have a total of six performing arts theaters. But the area also has hundreds of new luxury apartments in the pipeline, along with new retail and office space. The Dermot Company’s new rental tower, 66 Rockwell Place, is set to start leasing this summer. Two Trees, meanwhile, is developing a 300-unit residential building plus a 50,000-squarefoot cultural space and public plaza. And bids were due to the city’s Department of Housing Preservation and Development early last month in response to a request for proposals for the last development parcel in the cultural district. The RFP called for a 100,000-square-foot residential, community or commercial space, with a requirement for least 15,000 square feet for cultural space and the arts. An agency spokesperson told The Real Deal that the city is aiming to announce the winning bid by late summer. “People will look back at this and say it’s a truly remarkable renaissance,” said Douglas Steiner, developer of the Hub, a 720-unit rental tower at Flatbush Avenue and Schermerhorn Street.

and junk in the area,” said veteran Brooklyn broker Chris Havens, director of commercial properties at Brooklyn-based real estate brokerage aptsandlofts.com. That began to shift in 2004 when, in an effort to spur development, the city rezoned the Downtown Brooklyn Cultural District and other nearby areas to allow for taller buildings. The result was a spate of development that started then and is continuing to build up steam now.

According to a market report from the brokerage MNS, the average monthly rent for a studio apartment in Fort Greene was $2,341 in January, up from $1,773 in January of last year. One-bedrooms rented for an average of $3,254, up from $2,597 in the same month of 2012. Spitler said he expects the market to support those rents fairly easily. “There’s just not enough product to meet the demand,” he said. “You really can’t build

“Think about what happened at the Lincoln Center area in the ’90s — that’s what’s happening to the BAM center now.” Melissa Pianko, the Gotham Organization

Gotham Organization’s 600-unit project

The Brooklyn Academy of Music

The Hub

66 Rockwell Place

Two Trees’ 32-story project

Housing surge BAM opened in its current location at 30 Lafayette Avenue in 1908, a time when Fort Greene was a fashionable neighborhood. But despite its status as a cultural destination, the area fell on hard times in the 1970s and ’80s. Along with other parts of “Brownstone Brooklyn,” Fort Greene has seen a resurgence — and skyrocketing home prices — in recent years. But the more industrial area immediately surrounding BAM has lagged behind, brokers said. “There have been so many vacant lots

Among the most striking changes are the new residential buildings in the area. Drew Spitler, director of development for Dermot, said 66 Rockwell will have 326 rental apartments, 80 percent of them market rate and 20 percent affordable. Monthly rents for the market-rate units will average around $58 per square foot, he said, with studios starting at $2,500 per month, one-bedrooms asking $3,500 and two-bedrooms asking $4,700.

it quick enough.” Terry Naini, a Brooklyn-based associate broker at Town Residential, said 66 Rockwell “will have no problem” leasing up at those rates because it’s a new construction building. “There are so many people looking for these kinds of rentals,” she said. Steiner, too, said he’s not worried about competition for renters at the Hub, despite the influx of new units in the area.

“I think it’s all good for the neighborhood,” he said. “The street experience will be fantastic.” Pianko said Gotham is scheduled to break ground later this year on its 600-unit project, which will include 300 affordable apartments and a full floor of office space.

Retail renaissance The BAM area is also undergoing significant retail changes. “The demand for retail around the area has gone through the roof,” Havens said. He noted that since the rezoning in 2004, retail rents in the cultural district have doubled or tripled. Retail space that was leasing for $30 per square foot 10 years ago could go for $100 today, he said. Spitler said Dermot is close to signing a deal with a restaurant at 66 Rockwell, which will have 7,500 square feet of retail on Fulton and Flatbush. He declined to give further details. The Hub will also seek a restaurant tenant for its ground-floor retail space, Steiner said. Meanwhile, Two Trees is seeking city approval for its 32-story Enrique Norten–designed project at Flatbush and Lafayette avenues and Ashland Place. The project will have 300,000 square feet of residential space, including some 300 rental units, said David Lombino, director of special projects at Two Trees. (The project is also an “80/20,” and Two Trees will apply to the state for affordable housing bonds financing once the project gets underway, he said.) The building will also include a 50,000-squarefoot cultural facility housing a public library and three new movie screens operated by BAM. There will also be 25,000 square feet of retail and a 16,000-square-foot public plaza. “What’s missing in that neighborhood is a meeting place,” Lombino said. “We see [the plaza] as a great public meeting place.” With help from the city, the BAM area is also continuing to attract more cultural institutions. The nonprofit arts organization BRIC, for example, will move into the newly renovated Strand Theatre building at 647 Fulton Street this year. And the Theatre for a New Audience in 2011 broke ground on a new 299-seat theater on the site of the cityowned parking lot on Ashland Place. Tucker Reed, president of the nonprofit Downtown Brooklyn Partnership, said within the next four years the neighborhood will have about 40 arts and cultural organizations, ranging in size from mega institutions like BAM to smaller arts incubators like the Alliance of Resident Theaters/New York. And unlike Lincoln Center, he noted, the area will have a diverse range of venues, ranging from the 19,000-seat Barclays Center to the 200-seat BAM Fisher and century-old BAM Opera House. “We like to think of this as a cultural district that caters to everyone — not just the New York elite,” Reed said. TRD

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Solow’s strategy

The litigious landlord’s recent land sales have some saying he’s in liquidation mode, others disagree

eal estate tycoon Sheldon Solow, 84, has seen his career rise and fall more than once in the decades he’s been developing in New York. Solow, head of Solow Realty, built his first (and now most famous) office building, 9 West 57th Street, in the early 1970s. He followed that with rental developments on the Upper East Side, such as 1 East River Place, 1 Sutton Place North and 265 East 66th Street. Famously litigious, he has reportedly been party to at least 350 lawsuits.

Recently, he’s sold off portions of a large parcel near the United Nations where he was planning a $4 billion development. That’s prompted speculation that he’s seeking to liquidate more of his assets. One source told TRD, however, that he’s mostly selling pieces of his valuable art collection and not his real estate. This month, The Real Deal looked at the ups and downs of the enigmatic landlord. B Y G UELDA V OIEN

Son of a bricklayer

End of the East River project

According to news reports, Solow was born in Brooklyn in 1928 and is the son of a bricklayer, but few details about his childhood have been published. What is known is that Solow reportedly dropped out of New York University in the 1950s to go into real estate and began building residential projects, mostly in Far Rockaway, Queens.

Just last month, Solow reportedly sold another large East River parcel to developer JDS Development for about $200 million. JDS is planning two residential towers with more than 800 units, according to a company spokesperson. Solow, who spent millions remediating environmental conditions at the site, still owns a parcel on First Avenue, which he “does not intend to sell,” according to a source familiar with the matter.

UES apartments

Forbes 400

Solow’s first project in Manhattan was at 501 East 87th Street, where, in 1962, he redeveloped a 179-unit rental building, investing an estimated $4 million, according to the New York Times. Also that year, he moved his office from Far Rockaway to 410 Park Avenue.

Solow jumped from No. 227 to No. 111 on the Forbes 400 list of richest Americans last year, as his net worth ballooned from $1.9 billion to $3.5 billion. Some have taken that as evidence that he’s liquidating assets. A spokesperson for Solow declined to comment. Solow, an active art collector, sold a Francis Bacon painting for $33.3 million last year, according to news reports.

The Solow Building

At age 42, Solow staked everything to build a 50-story skyscraper at 9 West 57th Street, also known as the Solow Building. The project was 85 percent leased by 1974, even amid a rocky economy.

Breaking records

In February 2012, Solow edged out Extell’s Gary Barnett to purchase 12 West 57th Street from Trigon Equities. He paid $120 million, or $1,400 per square foot, nearly a price-per-square-foot record for office space in the city. Solow’s plans for the building are unclear.

Avon lawsuits

The largest tenant at 9 West 57th Street after the building opened was cosmetics giant Avon. But shortly after Avon increased its footprint in the building, Williams Real Estate, the firm handling leasing, sued Solow, alleging he cut it out of the deal. A court later awarded Williams $1.7 million. In 1975, Solow sued Avon for calling the tower “the Avon building” without paying him for naming rights. The case was dismissed. When Avon moved out in 1997, Solow sued it for failing to return its spaces to their “original condition.” Avon settled for a reported $6.2 million.

East River sell off

It appears that Solow has moved on from his megaproject visions: In 2010, he sold about onethird of a block of the southernmost parcel to the city for some $33 million.

Siegel suit

East River project

Partnering with Fisher Brothers, Solow bought nine acres of land along First Avenue for $630 million in 2000. The partners planned a $4 billion megaproject with seven residential towers, one office tower, five acres of public space and a school. But in 2007, after a bitter feud, Solow bought out his partners for $227 million. A 2011 lawsuit by the Fisher Brothers alleged that Solow still owed them $111 million. A source said the suit has since been settled.

Nine West 57th Street has seen a revolving door of exclusive leasing brokers, including CBRE megabroker Stephen Siegel, who sued Solow for an alleged $1.6 million in unpaid commissions in 2009. Others have said Solow lets spaces sit on the market, often with above-market asking prices, rather than negotiate with certain tenants. In 2007, Corcoran broker Neal Sroka told TRD that Solow was “one of the most difficult landlords in the world.” Scott Panzer of Jones Lang LaSalle, who now handles leasing at the building, said Solow’s thoroughness with tenants’ financials means tenants rarely, if ever, default.

Hard times

Half of 9 West 57th Street was sitting empty by 2010, meaning a potential loss of $60 million or $70 million a year in revenue, according to the Times. The building is in better shape now: According to the CoStar Group, some 385,000 square feet of office space and 34,000 square feet of retail in the 1.5 million-square-foot building are for lease. Plus, Panzer said he’s in talks to rent large chunks of space there. One source said asking rents on high floors are around $200 per square foot.

Firm shake up

In 2010, the Times reported that Solow’s wife and son had taken over because Solow had medical problems. That same year, the company lost a number of executives, including several who sued after being fired. But it appears Solow is now back at the helm.

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REGULATING REAL ESTATE

FHA fees pack a bite

Is the agency moving away from its traditional customers? BY KENNETH HARNEY or homebuyers hoping to use minimal cash by getting an FHA-insured mortgage, here’s some sobering news: Thanks to an ongoing series of fee increases and underwriting tweaks — the most recent of which were announced Jan. 31 — FHA is getting steadily more expensive. FHA is the Federal Housing Administration, the largest source of low down-payment mortgage money in the country. Its minimum down is just 3.5 percent, compared with anywhere from 5 to 20 percent or higher from conventional nongovernment sources. For decades, FHA’s affordable financing has made homeownership possible for first-time buyers with modest incomes and credit history blemishes. But in the wake of losses tied to bad loans insured during the housing bust years, FHA has been raising its loan insurance fees and backing more loans to applicants with higher credit scores. With the

latest increases, things have gotten to the point where some lenders wonder whether the agency is trying to move away from its traditional customers. Dennis Smith, broker and co-owner of Stratis Financial Corp. in Huntington Beach, Calif., is blunt: “I think FHA is putting itself out of business with the moves they’ve made in the past couple of years.” While they wouldn’t agree with that assessment, FHA’s top officials readily admit that their priority is not growing market share but protecting the agency’s multibillion-dollar insurance fund reserves and cutting losses. Starting April 1, FHA’s annual mortgage insurance premiums for most new loans will jump by onetenth of a percentage point, or 10 basis points in lending parlance. This is on top of two previous increases since 2011. Other coming changes, though not scheduled to take effect until June 3, include mandatory “manual” underwrit-

ing of applications by borrowers whose total household debt-toincome ratios exceed 43 percent and who have credit scores below 620, and mandatory 5 percent minimum down payments on FHA loans above $625,500 in high-cost areas such as New York, California and others. FHA also announced that as of June 3, it is rescinding its popular policy of canceling mortgage insurance premium charges for borrowers once their loan balance declines to 78 percent of the original amount. This will force FHA customers to pay premiums for as long as they keep their loans, and is in stark contrast to the private mortgage insurance market, where homeowners can request cancellation of premium payments once their loans hit the 78 percent mark. “That stinks,” said Steve Stamets, a mortgage officer with Apex Home Loans in Rockville, Md. “It’s just a money grab” that Continued on page 102

When the client says they’re going with another agency, we’re that agency.

GOVERNMENT BRIEFS Related proposes land swap with community college The Related Companies is promoting a proposal to secure the Borough of Manhattan Community College as anchor tenant of the Moynihan Station project, the New York Times reported. The proposal would move the college to 1.1 million square feet inside the Farley Post Office building on Eighth Avenue. Related would simultaneously build a new train hall, train platforms and underground connections Borough of Manhattan Community to Penn Station at the front end of the College post office. In return, Related would use the college’s current campus downtown for residential development. Related and development partner Vornado Realty Trust were selected eight years ago by the state to develop Moynihan Station, but their initial plans fizzled during the 2008 financial crisis. After wooing college officials for more than a year, Related chairman Stephen Ross met with the Cuomo administration in January hoping to convince them that this is the most viable option. But Cuomo and the City University of New York, which runs the college, have not embraced the proposal, the Times reported.

NYCHA to lease land to developers The New York City Housing Authority announced a plan last month to lease its land to private developers, who will then build some 3 million square feet of luxury apartments, the New York Daily News reported. The apartments will be built on top of parking lots, community centers, playgrounds and baseball fields within NYCHA developments. The plan calls for 4,330 apartments in eight developments, 20 percent of which will be set aside as “affordable” and offered to families of four making $50,000 or less. Developers will sign 99-year leases, with the payments to the authority frozen for the first 35 years.

New FEMA maps double the number of property owners in flood zones Following extensive Hurricane Sandy damage, the Federal Emergency Management Agency last month released new maps with hugely expanded flood zones, Crain’s reported. The change impacts more than 35,000 New York property owners, who could now face diminished property values and rising costs associated with being located in a flood zone. They may also have a harder time securing mortgages. The Bloomberg administration moved to address some of the unAmanda Burden certainty surrounding the expanded flood zones, however, by issuing an executive order suspending certain zoning restrictions, such as building heights, which could hinder property owners in their rebuilding efforts. “Homeowners need to be able to rebuild to sound flood-protection standards without facing conflicts with current zoning regulations,” said New York City Planning Commission chair Amanda Burden. “This limited and targeted suspension of zoning regulations in the flood zones ... will help ensure that new and rebuilt homes and businesses and other buildings will be safeguarded from coastal floodwaters.”

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Profile

Can Mitchell, Maxwell & Jackson survive? Amid battle with a former employee, big appraisal firm goes from flying high to teetering on brink

By Guelda Voien nlike residential real estate brokers, who are enjoying better times after years of depressed sales, appraisers are still struggling. At the market’s peak, the appraisal firm Mitchell, Maxwell & Jackson was one of the most dominant in New York City. And one supervising appraiser, Marianne Mueller, stood out as MMJ’s most successful employee, according to the heads of the firm. Then the recession hit, and relations between Mueller and MMJ soured, too. The case, which The Real Deal first reported online, resulted in an administrative court judge ruling to pull the licenses of MMJ’s founders — Steven Knobel and Jeffrey Jackson — effective Feb. 1. But that harsh measure has been put on hold pending the founders’ appeal. This month, TRD took a closer look at the firm and how it went from flying high during the boom to teetering on the edge of closure today. And the Mueller case provides a unique lens into the behindthe-scenes operations of the firm and the changes that the struggling appraisal industry has undergone in recent years. The bone of contention in that case: Mueller’s electronic signature. She accused MMJ of signing her name to 14 appraisals that she insists she never saw. MMJ eventually fired Mueller, who had climbed to executive vice president, and she filed a complaint with the New York Department of State, which regulates appraisal firms. At a Dec. 27 administrative law hearing, a judge ruled in her favor, determining that Knobel and Jackson knew that their other employees were affixing Mueller’s electronic signature to the appraisals, all conducted in 2009. That’s when he ruled to pull Knobel and Jackson’s licenses — an action that sources say is virtually unheard of. MMJ appealed the judge’s order. In January, a senior DOS official granted a stay to the firm, noting that the judge mistakenly used a test applicable to only brokers. (Brokerage firms are responsible for the conduct of their employees; appraisers, though, are not.) As TRD went to press, the DOS opposed the appeal, which pushes the matter to the Secretary of State, according to a DOS spokesperson. It’s unclear when the Secretary of State will issue a decision on whether Knobel and Jackson can retain their licenses, the spokesperson said. Knobel and Jackson deny any wrongdoing. “[Mueller] tells different sets of stories, convincingly,” said Knobel in a sit-down interview with TRD last month. “But so did the people in the witch trials in Salem. And people got burned for it.

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“She says she is trying to protect the industry, but she isn’t trying to protect anything but her money,” he said.

He said, she said Mueller sued MMJ in May 2010 in New York State Supreme Court, accusing the firm of a myriad of wrongdoings such as misappropriating funds, misclassifying her as an independent contractor, wrongfully firing her and failing to compensate her according to her contract.

not paid commissions in a timely fashion because MMJ was broke; MMJ claims that she had agreed not to be paid until her clients paid their bills. Mueller alleges she was fired in 2010 without cause; MMJ contends she was terminated for incorrect billing and insubordination, once challenging Knobel to “fire me.” MMJ denies all wrongdoing. “It’s a matter of getting to me because I threw her to the curb,” Knobel said of Mueller. “She is a vindictive person. She

ers to near 100 people,” said Jonathan Miller, who runs real estate analytics company Miller Samuel, which competes with MMJ. Only two years later, though, MMJ’s client list, once about 3,000 strong, had dwindled to about 50, Knobel said. And many of the firm’s appraisers, most of whom weren’t salaried, walked out the door, too, when the business dwindled. In 2009, MMJ traded its office in a Fifth Avenue skyscraper for more modest digs on 41st Street. Today, the owners are in a dis-

MMJ’s founders, Jeffrey Jackson, left, and Steven Knobel deny wrongdoing in connection with a lawsuit filed against them, but acknowledge that the firm is struggling.

A legal battle between a former Mitchell, Maxwell & Jackson appraiser and the firm provides a unique lens into the firm’s operations and the changes that the struggling appraisal industry has undergone in recent years. MMJ contends that the lawsuit has not proceeded because Mueller has limited evidence to support her charges and had hoped the administrative hearing would boost her case. Mueller’s attorney, Adam Russ of the Manhattan-based Wasser & Russ, called that “nonsense,” and said it was MMJ who had requested adjournments in the civil case. “Ms. Mueller looks forward to her day in court,” he said. The two sides are scheduled for a mandatory arbitration this month. But in the claims and counterclaims reviewed by TRD, Mueller and MMJ disagree on nearly every point. Mueller, for instance, claims she was

tells stories.” Whether fact or fiction, Mueller has been successful speaking on her own behalf. At the administrative law hearing, the judge called Mueller’s testimony “convincing,” despite the “large number of documentary exhibits” presented by MMJ.

A breakneck pace Knobel and Jackson launched MMJ in 1991 and, by all accounts, saw their firm soar. “Every time I would do a closing, they seemed to be the appraisers,” said real estate attorney Adam Leitman Bailey. By 2008, MMJ was one of Manhattan’s eminent appraisal firms. “They went from a handful of apprais-

pute with their former landlord, a limited liability corporation, over unpaid rent for the space at 546 Fifth Avenue. Knobel told TRD that the former landlord was granted a judgment against them. Many blame the housing crash on appraisal firms, contending they helped inflate real estate prices through their cozy relationship with mortgage brokers. MMJ was never accused specifically of malfeasance, but industry sources told TRD that the firm relied heavily on mortgage broker clients and filled out appraisal forms with breakneck speed. “They had people doing 40 appraisals a week,” said a fellow appraiser, who asked Continued on page 98

PHOTOGRAPH FOR THE REALJanuary DEAL BY CHRIS www.TheRealDeal.com 2013MARTIN 65

2/28/13 10:40 AM

BEFORE YOU SELECT A REAL ESTATE LAW FIRM CONSIDER ASKING THESE QUESTIONS Q: What is the purpose of the real estate department? Is it to help “you” (the client) grow and expand your business (including coming up with innovative ideas and making critical business connections) – or is its sole purpose to produce legal documents in return for fees? Q: How much turnover has there been among associates and partners in the real estate department in the past five years (including through the Great Recession)? Q: What “results” has the real estate department had recently (i.e., during the down-turn in real estate did the documents the law firm produced hold up strongly and safely)? Q: Do the partners work as a team or is the lawyer you have met essentially a solo practitioner practicing under the brand name of the law firm he/she works in? At Duval & Stachenfeld, we have a roughly 45-lawyer real estate department (one of the largest in New York City). Despite our size, we work as an integrated team and therefore all real estate partners share a single goal of providing outstanding service to all of our clients. In addition to drafting great legal documents, we differentiate ourselves by making the true focus of our efforts the building and expanding of our clients’ businesses. One aspect of this is that we have made ourselves very “connected” in the real estate world. So, for example, in addition to providing great legal service, we locate operating and financial partners for our clients in order to foster deal flow. Finally, at Duval & Stachenfeld, our reason to exist is that we genuinely care about our clients, our attorneys and staff. This is not just because lawyers bill hours and clients pay money, but because these people matter to us. This is the core of our “hedgehog principle” and what inspires us to come to work every day. We think this is the reason our turnover is so low – because we lawyers actually like each other and enjoy working together. We think it is also one of the main reasons our clients stay with us – they like the feeling that their lawyers care about them and are looking out for them.

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Commercial

Stacking up sales brokers

In TRD ranking, commercial firms that targeted midsize trades surged as bigger brokerages stalled

By Adam Pincus ommercial property sales in New York City surged in 2012, boosting transaction volume and revenue for most, but not all, of the city’s investment brokerage firms. Buyers spent $39.1 billion purchasing commercial real estate in New York City last year, according to figures from Massey Knakal Realty Services. That was the highest dollar volume since 2007 — when sales peaked at $62 billion — and up 53 percent from 2011’s $25.6 billion. And while in 2011, mid-market firms captured a piece of the commission pie that was roughly on par with their megafirm counterparts, they trounced them in 2012, according to an analysis and ranking by The Real Deal. To conduct the analysis, TRD combed through more than 1,000 deals valued at $1 million or more in the five boroughs, the vast majority of them below the headline-grabbing $50-million-and-up price range. For the first time, TRD also estimated the total commissions the firms received through these transactions. What we found was that Massey Knakal, which specializes in building sales ranging from $1 million to $20 million, saw its sales volume more than double last year to nearly $2.1 billion. Relative newcomer Rosewood Realty Group, operating in the same market segment, similarly saw its sales surge by roughly $900 million to $1.4 billion. But it was a mixed year for the city’s top two firms — Eastdil Secured (which had $7 billion in sales) and CBRE Group (which had $3.5 billion). Those firms saw their totals level off or fall as large building sales slowed, according to TRD’s figures. Nonetheless, they still ranked No. 1 and No. 2, respectively, on the ranking of overall investment sales volume in New York City in 2012. Also brokering more than $2 billion in deals were Jones Lang LaSalle and Massey Knakal, which ranked No. 3 and No. 4, respectively. Richard Baxter, a vice chairman at JLL, credited the market in part for his firm’s sharp rise over 2011. “We benefited greatly from the improved market conditions … [as well as from] the financing market. The low interest rate environment and capital coming from all over the world to invest helped us to increase our market share,” Baxter said. When it came to estimated commissions, Massey Knakal topped the list with about $50 million to $60 million — far ahead of Eastdil, which TRD projected had

36 March 2013 www.TheRealDeal.com

036 Investment sales se FINAL.indd 1

Ranking NYC’s investment sales firms by deal volume (2012) Rank

Brokerage

DOLLAR volume

# of deals

% change from ’11

Estimated Commission

Eastdil Secured

$7 billion

-7%

$30 to $35 million

CBRE Group

$3.5 billion

-39%

$18 to $23 million

Jones Lang LaSalle

$2.09 billion

76%

$14 to $18 million

Massey Knakal Realty Services

$2.05 billion

214

133%

$50 to $60 million

Rosewood Realty Group

$1.4 billion

124

164%

$20 to $25 million

Eastern Consolidated

$1.3 billion

55%

$20 to $25 million

Cushman & Wakefield

$1.2 billion

-35%

$10 to $14 million

HFF (Holliday Fenoglio Fowler)

$892 million

47%

$7 to $10 million

Studley

$830 million

74%

$6 to $9 million

Newmark Grubb Knight Frank

$708 million

60%

$10 to $14 million

Marcus & Millichap

$582 million

34%

$15 to $19 million

Besen & Associates

$483 million

64%

$13 to $17 million

Prince Realty Advisors

$468 million

n/a

$2 to $3.5 mililon

Colliers International

$370 million

1,629%

$2 to $3 million

HPNY

$348 million

n/a

$1 to $3 million

Corcoran Group

$295 million

n/a

$5 to $7 million

Carlton Group

$294 million

-46%

$1 to $1.5 million

Venture Capital Properties

$253 million

n/a

$2 to $4 mililon

GFI Realty Services

$232 million

23%

$7 to $9 million

Highcap Group

$210 million

225%

$3 to $4.5 million

Ariel Property Advisors

$181 million

420%

$5 to $7 million

Pinnacle Realty of New York

$153 million

82%

$4 to $6 million

Halstead Property

$152 million

n/a

$2 to $4 mililon

Douglas Elliman

$150 million

87%

$4 to $6 million

Capin & Associates

$145 million

-33%

$5 to $7 million

Friedman-Roth Realty Services

$126 million

12%

$3 to $4.5 million

Itzhaki Properties

$97 million

-9%

$2.5 to $4 mililon

Kalmon Dolgin Affiliates

$94 million

219%

$2.5 to $4 mililon

TerraCRG

$87 million

211%

$2.5 to $4 mililon

Fenwick Keats Real Estate

$69 million

n/a

< $1 million

Greiner-Maltz Real Estate

$65 million

19%

$1 to $2 million

Cornerstone Real Estate Investments

$60 million

n/a

< $1 million

CPEX Real Estate

$57 million

268%

$1 to $2 million

RKF

$45 million

-14%

$1 to $2 million

Cassidy Turley

$41 million

-41%

$1 to $2 million

Source: Analysis of CoStar Group data, Real Capital Analytics data as well as TRD research. In addition, TRD received confirmation for transaction totals from 28 of the firms. The revenue estimates were based on standard, average commission rates, starting at 3.3 percent for deals around $1 million and falling to 0.3 percent for deals over $500 million. All companies that were identified as investment sales brokers in industry databases or news reports were included in TRD’s analysis. Deals were tallied for all of 2012.

about $30 to $35 million. Eastern Consolidated and Rosewood earned about $20 to $25 million each, while CBRE took in a bit less.

The analysis, however, did not count note sales, advisory services, matching up capital partners and other consulting work that firms such as Eastdil, CBRE and East-

ern Consolidated are often paid hefty fees for. Those services are provided entirely out of the public eye. Continued on page 94

www.TheRealDeal.com January 2013 65

2/28/13 11:05 PM

Commercial

The leasing game I

By Adam Pincus n the cutthroat world of Manhattan office leasing, brokerages are regularly trying to best one another by finding new landlords and tenants to represent. But which firm actually does the most deals? To find out, this month TRD conducted a first-ever review of both landlord- and tenant-side office-leasing transactions. We pored over more than 3,000 Manhattan leases inked in 2012 totaling more than 38 million square feet, pooling together recorded transactions of more than 1,800 square feet from databases such as CoStar Group, TRD research and information supplied by sources. (Tenant-side transactions are not tracked reliably by CoStar or other commercial databases, but TRD obtained transaction lists from sources at several of the leading firms to fill out the numbers.) In addition, much like TRD did on the investment-sales side this month, we conducted an analysis estimating how much each firm took home in revenue through its leasing activity for the year. (We applied a standard commission rate of 32 percent of lease payments in the first year on a 10-year deal to the tenant-side brokers, and — following industry custom — about a third of that rate for the landlord-side brokerage.) What we discovered is, despite the fact that 2012 was a slow year for Manhattan office leasing — total volume was down 9 percent from a robust 2011 — by TRD’s estimate, landlords still shelled out an estimated $750 million in commissions last year to these office leasing firms. So there was plenty of money on the table for the companies to aggressively pursue. “I would imagine that [the commission] number is quite large,” considering the enormous volume of leasing done in the city, said Bradley Kaufman, a partner and head of the commercial leasing practice at law firm Pryor Cashman. For both transaction volume and revenue, TRD looked only at the seven largest third-party brokerages active in the city. Clocking in at No. 1 on the ranking was CBRE Group, the world’s largest commercial brokerage. By TRD’s estimate, the company’s New York office brokered 13.2 million square feet of lease deals on both the landlord and tenant sides in Manhattan south of 59th Street, where all of Manhattan’s major office markets are located. CBRE was far ahead of its nearest rival: Newmark Grubb Knight Frank. That firm, headed by CEO Barry Gosin and now a part of the public company BGC Partners, brokered a little over 10.2 million square feet of deals. NGKF, while a powerhouse in New York, is much smaller globally. Ranking No. 3 was Cushman & Wake-

Total office leases brokered in Manhattan, 2012 Firm

037 Leasing game se FINAL.indd 1

Total # of deals

Total square feet

Total COMMISSION

CBRE Group

435*

13.2 million*

$200 to $250 million

Newmark Grubb Knight Frank

482*

10.2 million*

$110 to $150 million

Cushman & Wakefield

245

8 million

$75 to $100 million

Jones Lang LaSalle

545

7 million

$75 to $100 million

Studley

180

4.8 million

$75 to $100 million

Colliers International

358

3.1 million

$15 to $25 million

Cassidy Turley

183

2.4 million

$25 to $30 million

Source: The Real Deal research and an analysis of CoStar Group data and industry sources. TRD estimated revenue using standard industry commission rates, which were applied to all deals. Commission was based on rent and length and size of lease. *Full deals were not available through CoStar or industry sources; projections were tallied based on CoStar figures plus TRD estimates. TRD only ranked the seven largest third-party brokerages active in the city.

Total tenant-side leases brokered in Manhattan, 2012 Firm

# of tenant deals

square feet

COMMISSION

CBRE Group

150*

9 million*

$182 to $220 million

Newmark Grubb Knight Frank

150*

6 million*

$90 to $120 million

Studley

223

4.4 million

$75 to $100 million

Cushman & Wakefield

260

4.1 million

$50 to $70 million

Jones Lang LaSalle

3 million

$50 to $70 million

Cassidy Turley

100

1.9 million

$20 to $25 million

Colliers International

157

1.7 million

$10 to $20 million

Source: See source note above.

Total landlord-side deals brokered in Manhattan, 2012 Firm

# of landlord deals

square feet

COMMISSION

CBRE Group

285

4.3 million

$22 to $27 million

Newmark Grubb Knight Frank

332

4.3 million

$20 to $25 million

Jones Lang LaSalle

154

4 million

$22 to $27 million

Cushman & Wakefield

285

3.9 million

$20 to $25 million

Colliers International

201

1.4 million

$3 to $5 million

Cassidy Turley

510,000

$3 to $5 million

Studley

350,000

$850,000

Source: See source note above.

NGKF’s Barry Gosin

Studley’s Mitchell Steir

field, the New York–based firm, which brokered about 8 million square feet. Then came Jones Lang LaSalle, the world’s second-largest commercial firm, which has been growing its New York office with a series of strategic hires in recent years. The firm brokered

PHOTOGRAPH OF GOSIN FOR THE REAL DEAL BY MAX DWORKIN; PHOTOGRAPH OF STACOM BY MARC SCRIVO

42 March 2013 www.TheRealDeal.com

A first-ever ranking of firms by all of their Manhattan office leases — and commissions

JLL’s Mitchell Konsker

about 7 million square feet in total leasing transactions. The next wave of firms included Studley (with 4.8 million square feet in leasing transactions), Colliers International (with 3.1 million square feet) and Cassidy Turley

Cushman’s Tara Stacom

(with 2.4 million square feet). While the order of the list may not be a huge surprise to industry observers, the ranking provides a first look at the actual deal volume of each of these firms — which Continued on page 96

www.TheRealDeal.com March 2013 37

2/28/13 11:33 PM

Liability lessons By Katherine Clarke onvincing busy Manhattanites to serve on their co-op or condominium boards has always been somewhat of a hard sell. Indeed, acting as a board member has long been a time-consuming (and often hassle-filled) job. But now, residents have more reason than ever to avoid seeking election to their boards: getting socked with a personal liability lawsuit. Co-op and condo board members have always been open to legal action, but a slew of recently well-publicized lawsuits — most notably a high-profile suit at the famed Dakota on the Upper West Side — that singled out individual board members as defendants have made the risks more visible, sources told The Real Deal. “We live in a litigious society,” said Terry Oved, an attorney with the law firm of Oved & Oved. “The realistic implications [of serving on a board] are that, whether or not you’re really liable, someone can sue you and you could have to face this.” In the Dakota case, resident and former board member Alphonse Fletcher, Jr., sued the building’s co-op board in 2011 along with a number of the board’s individual members, accusing them of racial discrimination after his application to buy a second unit in the building was rejected. Fletcher, an African-American hedge fund manager, said the board used racial slurs when referring to him. He is seeking $15 million in damages, a percentage of which co-op board members would be responsible for paying if they were found liable. While the suit against the full board was not all that surprising, what really rankled the co-op world was a decision by an appellate court in July 2012 to allow Fletcher to continue his case against the individual board members — especially since a 2006 decision by the same court had limited when board members could be held personally liable. But Fletcher suffered a setback in December, when two law firms representing him withdrew as his counsel, with one saying he had failed to pay his bills and the other citing “irreconcilable differences,” according to news reports. Still, since Fletcher filed his suit, others have taken a page from his playbook and targeted individual board members in their own buildings, including at 210 East 36th Street, 88 Greenwich Street and 1107 Fifth Avenue. “It seems like there’s a lot of real estate litigation these days,” said attorney Robert Pariser of the law firm of Wilson Elser. “When you’re filling out a refinance application for a mortgage, they ask you if you’ve ever been involved in a lawsuit. You have to explain why. Even though you might not be ultimately responsible for something, people don’t want to be sued.”

In wake of high-profile cases, co-op and condo board members grow fearful of getting personally targeted in lawsuits

38 March 2013 www.TheRealDeal.com

038 Liability se FINAL.indd 1

A discrimination lawsuit against the Upper West Side’s Dakota has prompted copycat cases. Inset, resident and former board member Alphonse Fletcher, Jr., who filed the suit.

A buyer sued 210 East 36th Street for rejecting him based on his African nationality. Inset, broker Aileen Grossmann, one of eight board members named in the suit.

“They have to sit through depositions. It’s unpleasant to be dragged through a lawsuit. These people are left holding the bag. It’s scary.” Marc Fitapelli, attorney Marc Fitapelli, the attorney representing the plaintiff suing 210 East 36th Street, agreed, noting that lawsuits are disruptive to board members’ lives. “They have to sit through depositions,” he said. “It’s unpleasant to be dragged through a lawsuit.

“These people are left holding the bag. It’s scary,” Fitapelli added.

The law on liability Courts have long recognized the rights of co-op unit owners to decide for themselves who they want living in their buildings.

And while it’s illegal for boards to discriminate on certain grounds — such as race, ethnicity, age, gender, religion or familial status — they do not need to tell prospective buyers why they were rejected. However, their reasons often go beyond questionable financials. For example, in May, the board of 907 Fifth Avenue reportedly rejected an application by Sheikh Hamad bin Jassim bin Jabr al-Thani, the prime minister of Qatar, because they didn’t like his entourage hanging out in the halls. And, of course, celebrities such as Mariah Carey and Calvin Klein have also been rejected for fear they’d draw too much publicity — or too many paparazzi — to buildings that would rather be low-key. In the rare circumstances where discrimination is proven, individual board members can be forced to cough up punitive damages. Directors’ and officers’ insurance will not protect individual board members in those instances, sources say. The co-op board members at 210 East 36th Street are now dealing with the consequences of rejecting a litigious buyer. Eight board members and the board itself are currently being sued by an African buyer named Goldwyn Thandrayen. Thandrayen, who is seeking a yet-to-be-determined amount in damages, is charging that the board rejected his application to buy a unit based on his nationality. In court documents, the plaintiff alleges that one of the board members, Aileen Grossmann, a broker at Town Residential, wrote in e-mails that Thandrayen had the necessary funds to make the purchase and that she referred to his native Mauritius as a “tiny little unknown country” in an August e-mail to a fellow board member. “I would not consider any foreign [bank] accounts in a co-op sale package,” she said in the e-mail, according to the plaintiff ’s allegation in court documents, “especially when there is virtually no money in U.S. dollars and their entire portfolio is in some tiny little unknown country. It’s not like it’s in British pounds or Euro [sic] either.” Grossmann declined to comment on the suit, while Jack Cohen, an attorney for the co-op board, was not immediately available for comment. Fitapelli, Thandrayen’s attorney, also declined to comment on the case. But Pariser, who is not involved in the suit and spoke in broader terms, said it’s generally acceptable to reject a prospective buyer if the existence of their funds can’t be easily verified. “That could be because the Continued on page 100

www.TheRealDeal.com March 2012 00

2/28/13 10:42 AM

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WOMEN

REAL ESTATE

MaryAnne’s moment

The Forest City Ratner exec could be elevated to CEO this month, and industry sources say they expect big things

BY ADAM PIORE o one can say that MaryAnne Gilmartin isn’t battle-tested. For years, she has served as chief lieutenant to Bruce Ratner in the fight to develop Brooklyn’s controversial Atlantic Yards project, a clash marked by lawsuits, bad press and angry protesters. So when news broke in late January that Ratner was planning to step down as CEO of Forest City Ratner, the company he founded, sources pointed to Gilmartin as his most likely successor. “When you have been through what they have together, when you face the opposition they have, either you end up with an unbreakable bond, or you end up never speaking with each other again,” said CBRE Group’s Tri-State CEO Mary Ann Tighe, who’s worked with both of them over the years. “There is a deep respect there.” While Forest City’s Cleveland-based parent company issued a statement saying it had “no definitive announcement to make” regarding leadership succession, a source close to the company said while the publicly traded company must comply with disclosure regulations, Gilmartin’s promotion could be officially announced as early as this month. The company said, however, that even “under any potential leadership succession planning,” it expects that Ratner “will remain deeply engaged and involved in the business.” Sources say that’s likely to mean that he will serve as chairman, while Gilmartin, 48, will take over all daily

“Bruce has been a good member of REBNY,” Spinola said. “But MaryAnne is much more outgoing in terms of her work, and she has been involved and has a personal relationship with a lot of people. People recognize the fact that she is a woman and believe she is breaking barriers, going through ceilings.” Both Gilmartin and Ratner declined to comment for this article.

Belly of the beast When Gilmartin was young, her father left, and her mother moved her and her siblings from Queens to Woodstock, N.Y. In a 2010 interview with The Real Deal, she described her home life as “chaotic,” and said it “cultivated a fierce sense of independence.” That independence landed her a scholarship to Fordham University. To pay the bills, she waited tables at an Upper East Side seafood restaurant Jerry and Val’s Seafood Café — still managing to graduate summa cum laude and Phi Beta Kappa. “Everybody should have to wait tables at one point in their life,” she said in the interview. “It teaches you how to multitask and treat people with dignity.” After graduating in 1986, she enrolled in the city’s Urban Fellows Program, which places young college graduates at local government agencies. Gilmartin chose the Public Development Corporation (now the EDC). Frank Marino — then the agency’s vice president for government affairs, marketing and public relations

Forest City Ratner’s parent company has made it clear that New York is a core part of its portfolio. As a result, Gilmartin’s profile is likely to rise and New York could play an increased role in the firm’s overall bottom line. responsibilities at the firm, including overseeing the construction division, making personnel and budget decisions and managing the relationship with the parent company. Over the years, Gilmartin has gained a reputation as a well-connected and savvy deal-maker, a rising star with a laser focus. Already one of the most powerful women in the New York real estate industry (see related story on page 42), this promotion catapults her into a new stratosphere. Indeed, Steven Spinola, the president of the Real Estate Board of New York, the city’s leading industry trade group, said he expects her to take a more active role in the industry’s governance and lobbying activities than Ratner has. He noted that she is close to many industry players at places like Tishman Speyer, Extell Development and the city’s Economic Development Corporation.

40 March 2013 www.TheRealDeal.com

040-041 Gilmartin se FINAL.indd 1

— interviewed her for the job and remembers being impressed. Gilmartin was 22, but acted “10 years older,” he said. “It was the whole way she carried herself, the whole comfort level in herself,” he said. “She was very quick on her feet, very tough-minded and very sure of herself.” Marino also remembered that Gilmartin listed “tubing” as an interest on her résumé. “I sometimes still kid her about it — at the end of the interview I said, ‘I gotta ask, what is tubbing?’ and she said, ‘No, tubing! You know when you take a big tube and float down the river?’” “You could tell from things like that that she was very affable … and had a sense of humor,” he said. The job no doubt provided valuable experience for her to draw upon decades later at Forest City. Indeed, Marino’s division required Gilmartin to help prepare the agency for sometimes-rancorous

MaryAnne Gilmartin is expected to take over as Forest City Ratner’s CEO for Bruce Ratner, who will likely stay on as chairman.

www.TheRealDeal.com January 2013 00 PHOTOGRAPH FOR THE REAL DEAL BY MICHAEL TOOLAN

2/28/13 11:08 PM

Women public meetings over controversial developments, mostly in Queens and Brooklyn, and on Manhattan’s then-transitioning 42nd Street. Soon Gilmartin transferred out of PR and into policy, starting in the “corporate retention group,” said Anthony Mannarino, who was overseeing development for the agency at the time, and now works for Extell. In the late 1980s, New York City was mired in a recession, facing rising taxes and declining services and many corporations were considering moving away. The division’s job was to convince them to stay. Gilmartin’s role was to help structure deals for corporations that included tax breaks and other incentives. She worked to keep financial giants Morgan Stanley and Bear Stearns in the city, Mannarino said. “If you were working on a project or a deal and you needed to get something done quickly, on time and cover all your bases, MaryAnne was the go-to person,” Mannarino said. “That’s what she does. She was very good, very solid.” The Bear Stearns deal in particular was an important watershed for Gilmartin, he said. The investment bank had been threatening to relocate to Jersey City, following an exodus of firms that included Salomon Brothers, Merrill Lynch and Paine Webber. To keep Bear Stearns, the city negotiated $27 million in property-tax exemptions and tax credits, and $17.6 million in salestax exemptions and power-cost savings. In 1991, Bear Stearns agreed to move employees from Manhattan to a new $1 billion development off Flatbush Avenue in Downtown Brooklyn. The development was called MetroTech, and the man building it was Bruce Ratner.

Read all about it After leaving city government, Gilmartin briefly worked at Grubb & Ellis, advising corporations and developers on relocations. But in 1994, she joined Forest City Ratner as an assistant vice president. By the time she arrived, she had sat across the table from many of the city’s largest developers and had gained their respect as someone who “knows what they are talking about and understands your position,” said Spinola, a former head of the PDC. “She did not go over there to cover meetings for other people,” he added. “She went over there to pull deals together and to make things happen. That is what Bruce Ratner brought her over for.” In her early days at Forest City, she continued to work on MetroTech, directing leasing and then supervising the completion of part of the $56 million New York City Fire Department headquarters. She also worked on Forest City’s $220 million Times Square redevelopment project, in which the company completed

Real Estate to build the 52-story, 1.6 million-squarefoot, Renzo Piano–designed structure. It was around that time, right after Sept. 11, that Gilmartin and her husband decided that they wanted “to participate in as meaningful a way possible in raising our children,” she told TRD in 2010. So they decided that Gilmartin would work and her husband, a former police officer with a law degree, would stay home. That’s when she became the family’s primary breadwinner. “I slay the dragon every day and my husband is the quiet warrior,” she said. “He nurtures and cultivates our home life. It’s the secret to my success in so many ways.”

Bruce Ratner founded Forest City Ratner and has aggressively pushed through Brooklyn’s Atlantic Yards project.

Staying on message

REBNY’s president Steven Spinola, who says Gilmartin is “going through ceilings.”

Gilmartin is largely credited with winning the job to build the New York Times’ Eighth Avenue headquarters.

The Barclays Center, the newly opened centerpiece of Atlantic Yards.

“The arena obviously was a great first moment ... But they still have a huge amount to accomplish in terms of doing the housing and other aspects of the neighborhood. I think they will set a new standard in the area.” Jed Walentas, Two Trees Management a 650,000-square-foot mixed-use project that included a Hilton Hotel, Madame Tussauds wax museum and the AMC Cineplex. Forest City’s work on the Times Square project was the reason the company was selected in 2000 as a finalist to build the New York Times’ new Eighth Avenue headquarters, said Tighe, who led the developer selection process on behalf of the newspaper. Ratner chose Gilmartin, still a senior vice president, to deliver the presentation. Forest City was considered the least likely of five finalists to win the job — until Gilmartin led a presentation that “blew everyone away at the Times,” Tighe said. Not only did she have a “complete

PHOTOGRAPH OF RATNER THE REAL DEAL BY MAX DWORKIN; PHOTOGRAPH OF SPINOLA BY HUGH HARTSHORNE 44 November 2012FOR www.TheRealDeal.com

040-041 Gilmartin se FINAL.indd 2

understanding of the site” and the complexities surrounding the interplay between the public and private players, she also brought a dramatic flair: Halfway through the presentation of facts and figures, the door burst open and an actor dressed as an old-fashioned newsboy burst in, waving an old New York Times and shouting headlines. “In someone else’s hands, it might have been hokey,” Tighe said. “But with her, it sent a message: ‘Come with us, we will not only be a success, but we will have fun along the way.’ I remember everyone being surprised and laughing. … They came in underdogs and walked out the clear standout.” In the end, Forest City was selected

That dragon-slaying later meant overseeing the development of New York by Gehry at 8 Spruce Street, the 76-story, Frank Gehry–designed Downtown rental tower. But, of course, it’s Gilmartin’s work on Atlantic Yards — the $4 billion, 22-acre commercial and residential megaproject anchored by the Nets’ basketball arena, the Barclays Center — that she’s most known for. Atlantic Yards, unveiled in 2003, was already contentious when the company’s point person on the project, James Stuckey, left in 2006 to take over NYU’s Schack Institute of Real Estate. Ratner asked Gilmartin to take over. It was “right in the middle and we were embroiled in litigation and the project was struggling to get off the ground,” said Stephen Lefkowitz, a partner at the law firm Fried, Frank, Harris, Shriver & Jacobson, who served as Forest City’s counsel on the project. Lefkowitz said Gilmartin was initially reticent to set aside her other projects and get involved. “We were very far from having a grip on all elements of the project and putting together a viable structure,” he recalled. “The project needed a lot of help.” But Gilmartin soon got up to speed and began directly managing it. In the midst of the credit crunch, she led the charge to raise some $249 million for construction of the residential towers by recruiting Chinese investors eager to take advantage of the federal EB-5 program, which grants green cards to foreigners who invest at least $500,000 in the United States and produce at least 10 jobs in areas of high unemployment. She also negotiated with angry labor unions when the company chose to pursue modular construction for the residential portion of the project. And she was often leading negotiations with the state, the city and the Metropolitan Transportation Authority. “She is a very good negotiator,” Lefkowitz said. “She knows what she needs and she is very forceful in the presentation Continued on page 100

www.TheRealDeal.com March 2013 41

2/28/13 11:08 PM

Women

Real Estate

Dismantling the boys’club T

By Hayley Kaplan he New York City real estate community took notice when news broke in late January about MaryAnne Gilmartin’s expected promotion to CEO of Forest City Ratner. While women — including the Corcoran Group’s Pamela Liebman, Douglas Elliman’s Dottie Herman, Eastern Consolidated’s Daun Paris and CBRE Group’s Mary Ann Tighe — hold key leadership positions in the city’s residential and commercial brokerage worlds, New York still has very few female developers or development firm heads. “If you think about how traditional [deals have been done], it’s through relationships — an old boys’ network,” said Brittany Bragg, the chief operating officer of Crown Acquisitions. One reason for that is a lack of female mentors in the traditionally male-dominated

A roundup of some of the most influential women in NYC real estate investment and development

field of development, she said. And many developers start out in construction — another industry that has historically attracted few women. But Gilmartin and a wave of other powerhouse women are dismantling this long-standing boys’ club. From veterans like Amy Rose of Rose Associates to newcomers like Bragg, female executives are beginning to break new barriers in the development arena. Development “is a tremendous opportunity for talented women,” said Laurie Golub, HFZ Capital Group’s general counsel and COO. “The glass ceiling is only there if you look for it.” This month, The Real Deal talked to some of the most influential women in the New York City development and commercial investment world to find out how they got where they are and what challenges they’ve faced along the way.

Wendy Silverstein heads acquisitions and capital markets at Vornado Realty Trust, one of the country’s largest owners and managers of commercial real estate

Wendy Silverstein

executive vice president and cohead of acquisitions and capital markets, Vornado Realty Trust

ith a portfolio of over 100 million square feet, Vornado is one of the country’s largest owners and managers of commercial real estate. And Wendy Silverstein has been a head honcho there for nearly 15 years. Silverstein (who is not related to real estate mogul Larry Silverstein) told TRD she met Vornado CEO Steven Roth while working in the real estate group at Citibank in the 1990s and eventually joined him at Vornado. As Vornado’s cohead of acquisitions and capital mar-

42 March 2013 www.TheRealDeal.com

042-043 Powerful women se FINAL.indd 1

kets, Silverstein’s specialty is negotiating the debt and equity elements of deals. In one especially profitable deal she spearheaded, Vornado and four other partners in 2010 recapitalized the struggling LNR Property, one of the largest commercial loan servicers in the country. The four partners invested a total of $417 million in LNR, with Vornado contributing $116 million and retaining a 26.2 percent stake in the company. The servicer was sold in January to Starwood Property as part of a $1.05 billion deal, netting “a substantial profit” for Vornado, Silverstein said. (Vornado said in a statement it expects to receive net proceeds of $241 million from the transaction.)

Cushman & Wakefield’s Nat Rockett — who has worked with Silverstein on several deals, such as the conversion of the Knickerbocker Hotel at 1466 Broadway — said she is “very well respected.” “She’s a very smart person [who] knows her business very well,” he said.

Amy Rose

copresident, Rose Associates

my Rose may be copresident of Rose Associates, her family’s property management and development company, but she had to work her way up. Rose Associates was founded 88 years ago by Amy’s

www.TheRealDeal.com January 2011 25 PHOTOGRAPH FOR THE REAL DEAL BY CHRIS MARTIN

2/28/13 11:12 PM

Women great-uncle, David Rose, and grandfather, Samuel Rose. Amy spent her childhood visiting the company’s leasing offices with her father Elihu, who is now Rose Associates’ vice chairman. She also interned in the company’s co-op and condo department while in college at the University of Michigan. But Elihu “had a firm belief that if you came to work here, you had to have a real job,” Amy recalled. So when she graduated, she was hired by the company as an assistant project manager in construction. Twenty-four years later, she heads the firm with her cousin, copresident Adam Rose.

Real Estate

ket-rate units, while 37 of the units will be designated as affordable housing.

Laurie Golub

general counsel and COO, HFZ Capital Group

aurie Golub was a child when she was first exposed to the world of real estate, attending showings with her mom, a real estate agent in Westchester County. But after graduating from Boston University, Golub went on to law school at New York University. It was

“Those were hugely complex deals,” Golub said. Indeed, the former New York Times Building became a “poster child of the recession,” she noted, after Africa Israel paid a stunning $525 million for it in 2007, then saw its value plummet during the downturn. The company planned to convert the property, but instead ended up selling and leasing portions of the building. In May, Golub jumped to Ziel Feldman’s development and investment firm HFZ Capital Group, where she is working on about 15 projects in various stages of development. In January, HFZ purchased the prewar rental building the Chatsworth at 344 West 72nd Street for $150 million. The company is planning an “ambitious renovation” of the historic property, according to a statement released by Eastern Consolidated, which represented the seller, Chatsworth Realty, in the transaction. HFZ also recently acquired an office building at 11 Beach Street in Tribeca, which it’s planning to convert into residences. Feldman described Golub as an “integral part of the company.” He hired her because of her “ability and knowledge of the law with respect to acquisitions and real estate,” he said. “She presents a very good face for the company.”

Veronica Hackett

V Amy Rose, copresident of Rose Associates, at the firm’s headquarters at 200 Madison Avenue

From left: Laurie Golub, HFZ Capital Group’s general counsel and COO; Leslie Wohlman Himmel, cofounder of Himmel + Meringoff Properties; and Melissa Pianko, Gotham Organization’s executive vice president of development.

“[Development] is a tremendous opportunity for talented women. The glass ceiling is only there if you look for it.” Laurie Golub, HFZ CAPITAL group Amy oversees the company’s leasing, property management, development and marketing. Adam, lately, has been managing Rose Associates’ 70 Pine Street development. Rose acquired 70 Pine Street (American International Group’s former headquarters) in August from Nathan Berman’s Metro Loft Management and is reportedly converting the 66-story building into some 1,000 rental apartments. As for Amy, she said of herself, “The thing I’m most proud of in my career [is] working on those ground-up development projects that shape the New York skyline.” Indeed, she’s been heavily involved in the development of the Larstrand — a 181-unit, 20-story rental development at 227 West 77th Street. Construction began there after Rose Associates received a $125 million construction loan in October 2011. Rose reportedly plans to charge between $80 and $90 per square foot for mar-

PHOTOGRAPH ROSEwww.TheRealDeal.com FOR THE REAL DEAL BY CHRIS MARTIN 28 MarchOF 2012

042-043 Powerful women se FINAL.indd 2

while she was working on real estate deals as a corporate attorney at law firm Morrison Cohen that her interest in development began in earnest. So she took a job as associate general counsel at Forest City Ratner. While there, Golub led negotiations for the $400 million deal for the naming rights of the Barclays Center. She worked closely with Gilmartin, who oversaw the project (see related story on page 40). Golub then moved to Lev Leviev’s Africa Israel, where she was general counsel and managing director of business affairs. She was tasked with paring down debt at major properties such as the 589,617-square-foot former New York Times building at 229 West 43rd Street, the 267,000-square-foot Clock Tower at 5 Madison Avenue (which was formerly occupied by Metropolitan Life Insurance) and the Miami Marquis at 1100 Biscayne Boulevard in Miami.

chief development manager, Lightstone Group

eronica “Ronne” Hackett is perhaps best known as cofounder of the Clarett Group, a well-known Manhattan development firm that ceased operations in 2011. Now, however, she is chief development manager at the Lightstone Group, where she is overseeing the firm’s high-profile 770-unit rental development overlooking the Gowanus Canal in Brooklyn. Hackett, who declined to comment for this story, reportedly got her start in real estate in 1970 at Citibank’s real estate group. After stints at Chemical Bank and development firm Park Tower Realty, she and the late Neil Klarfeld, Park Tower’s executive vice president, struck out on their own, founding the Clarett Group in 2000. The company is known for projects such as the Brooklyner, a 491-unit rental building at 111 Lawrence Street in Brooklyn, which is currently the tallest building in the borough. But the firm ran into trouble during the economic downturn with projects such as the Forté at 230 Ashland Place in Downtown Brooklyn. The 108-unit condo development was only 37 percent sold in August 2009 when the Clarett Group handed control of the project over to Eurohypo bank. Clarett dissolved in March 2011. Immediately before the firm ceased operations, Hackett moved to Brookfield Office Properties, where she served as head of U.S. development and worked on the company’s 5.4 million-squarefoot Manhattan West mixed-use development near Hudson Yards on the Far West Side. She started at Lightstone in 2012. The firm’s 770-unit development — located on Bond Street in Gowanus — has made headlines recently because of its proximity to the polluted canal, which has sparked objections from local politicians and residents. Notwithstanding Clarett’s troubles during the real estate downturn, Hackett is “outstanding” and “a straight shooter,” said Adelaide Polsinelli, a senior director at Eastern Consolidated, who worked with Hackett while she was at Clarett. “Her contributions were really significant,” Polsinelli said. Continued on page 104

www.TheRealDeal.com March 2013 43

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44 March 2013 www.TheRealDeal.com

044 Expert witness se FINAL.indd 1

Expert witnesses work on rise for New York City real estate pros

BY GUELDA VOIEN Indeed, appraisers have struggled since he average reader of The Real Deal the adoption of the federal Home Valuamay not need help assessing proper- tion Code of Conduct in 2009, which rety values, but jurors and arbitrators quires third-party firms called appraiser do. And like doctors or other specialists, management companies to dole out apreal estate professionals who serve as ex- praisal assignments, instead of appraisers pert witnesses in court are well compen- finding their own clients (see related story sated for their services. on page 34). For that reason, work as an expert witIn court cases, expert witnesses in real ness has become an increasingly important estate are expected to do meticulous resource of supplemental income for many search and then state with authority — and New York real estate professionals in the brevity — why one property is worth more last few years — especially or less than the other party thinks it is. Acfor appraisers, whose field cording to Miller, valuing a property can take up to several days. has shifted dramatically On the residential side, divorces are a since the downturn. “There is a genersignificant portion of the cases that real perception that [tesquire expert witnesses. Crimtimony] is more well-paid inal cases — possibly where a defendant than general appraisal,” said purchased a building Theresa Nygard, a Manhattan-based commercial apillegally or defrauded praiser at KTR Real Estate their investors — and Advisors, who often serves disputes between buildas an expert witness in casing boards and their es that involve land valuashareholders are also tion. “But I can say that you somewhat common, said definitely earn it.” Larry Sicular, a broker at Nygard has worked Brown Harris Stevens on some of the highestand the head of the separately owned appraisal profile property disputes in New York City, including a firm Lawrence Sicular & years-long case involving Associates. several Times Square propSicular said he charges $5,000 to erties that the city took pos$6,000 for each apartsession of through eminent ment he researches for domain in the 1990s. THERESA NYGARD, a trial or arbitration. Currently, much of KTR REAL ESTATE For townhomes or sinher work consists of cases ADVISORS gle-family homes, he where the lessor (or land owner) in a 99-year land lease is renego- charges $7,000 to $8,000. But New York City has only a handful tiating with a tenant (usually a developer). Nygard is called in to estimate the fair of sought-after expert witnesses in real esmarket rent. tate, and it can be hard to break into the When appraisers do legal work, they set field. Attorneys want an expert who can stay their own fees. And they’re paid by the party who hired them, whether it’s the defense confident in the face of questioning, and or the plaintiff. that’s not always easy. While Nygard would not disclose her “Some people don’t like to be raked over rates, Timothy King, a broker with com- the coals,” said Nygard. “These attorneys mercial brokerage CPEX, said he charges are no slouches. Their job is to find the between $750 and $1,250 per hour chinks in your armor.” for work as an expert witness. King has The stakes are high: If an expert does worked on disputes between tenants and a good job in arbitration, their testimony landlords and between buyers and their can prevent a case from going to trial, saving both parties money. So when leading architects or brokers. Jonathan Miller, president of the ap- commercial lawyers see a good expert witpraisal firm Miller Samuel, said expert witness on the stand, they are likely to come ness work has been on the rise — at least calling repeatedly. for his firm. He said about 75 percent of “It’s a little bit like the chicken or the his firm’s business is now in legal support egg, because [lawyers or landlords] want services, compared with only a quarter in someone with trial experience,” King said. 2006. His firm has minimized its tradiAs a result, expert witnesses said they tional appraisal activities in recent years, usually see the same four or five experts he said, because of the changes in the in- retained in every case they work on. “It’s a dustry since the real estate downturn. small world,” Nygard added. TRD

“These attorneys are no slouches. Their job is to find the chinks in your armor.”

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NEW DEVELOPMENT

Brooklyn’s building bonanza

Developers in the borough are constructing new (and big) rental towers in force

BY KATHERINE CLARKE wave of new residential units is slated to hit the Brooklyn market in the next several years — and thousands of them will be rentals. At 88 Willoughby Street in Downtown Brooklyn, for example, the real estate investment trust AvalonBay Communities is developing an 861-rental-unit apartment tower. A few blocks away on Schermerhorn Street, developer Douglas Steiner is building a 720-unit rental. Meanwhile, Jeffrey Levine’s Douglaston Development, the company behind the Edge condominium, is planning a 40-story, 510-unit rental tower at 1 North 4th Place in Williamsburg, the third Northside Piers building. Sources say the pipeline for new Brooklyn developments is far fuller than it’s been in recent years, due to the revival of stalled projects and the increasing willingness of lenders to finance projects in the outer boroughs. The construction of these mega rental projects in Brooklyn offers a clear contrast to Manhattan, where high-end condos make better financial sense for developers faced with ballooning land prices. In Brooklyn, where land is cheaper and lending for condos is still tight, the economics of rentals are more attractive right now, industry experts said. In Brooklyn, “you buy land for 65 percent less than you could in Manhattan, but the rent [you’re collecting] is not 65 percent less,” explained Andrew Barrocas, CEO of residential and investment sales brokerage MNS. “It might be just 15 or 20 percent less.” In the recent past, about 70 percent of the

46 March 2013 www.TheRealDeal.com

046-049 Brooklyn dev se FINAL.indd 1

BROOKLYN’S NEW DEVELOPMENT PIPELINE Address

Neighborhood

Avalon Willoughby, 88 Willoughby Street

Downtown Brooklyn

The Hub, 333 Schermerhorn Street

Downtown Brooklyn

363 Bond Street 3 Northside Piers, 1 North Fourth Place

Gowanus

336 Flatbush Avenue 388 Bridge Street

Downtown Brooklyn Downtown Brooklyn

B2 BKLYN, 461 Dean Street 66 Rockwell Place Flatbush Ave, Lafayette Ave and Ashland Pl Dock Street Dumbo, 29 Front Street

Prospect Heights Downtown Brooklyn Fort Greene Dumbo

123 on the Park, 100 Parkside Avenue 95 Bedford Avenue

Flatbush Williamsburg

626 Flatbush Avenue 70 Fleet Street

Prospect Lefferts Gardens Fort Greene

204 Wythe Avenue

Williamsburg

500 Metropolitan Avenue 250 North 10th Street

Williamsburg Williamsburg

421 Kent Avenue 155 Broadway

Williamsburg Williamsburg

Total units

Williamsburg

1133 Manhattan Avenue

Greenpoint

81 Fleet Place

Fort Greene

395 Leonard Street

Williamsburg

755 Kent Avenue 246 North Eighth Street 90 Furman Street

Williamsburg Williamsburg Brooklyn Heights

Developer

861 720

AvalonBay Communities

700 510 440 378 363 326 300 300 270 262 254 251 235 234 232 216 216

Lightstone Group

210 205 187 177 170 150

Domain Cos.

Building type

Douglas Steiner Douglaston Development Brodsky Development Stahl Organization Forest City Ratner Dermot Company Two Trees Two Trees Chetrit Group Lipa Friedman The Hudson Companies Albee Retail Development AREA Property Partners Chetrit Group LCOR Xinyuan Real Estate Juan Figueroa

Rental Rental Rental Rental Rental Hybrid Rental Rental TBD TBD Hybrid TBD Rental TBD TBD TBD Rental Condo TBD

Rental Rental TBD Simon Dushinsky TBD Silverstone Property Group TBD Toll Brothers Condo/Hotel Red Apple Development Simon Dushinsky

Chart continues on page 47

“You buy land for 65 percent less [in Brooklyn] than you could in Manhattan, but the rent [you’re collecting] is not 65 percent less. It might be just 15 or 20 percent less.” ANDREW BARROCAS, MNS city’s new rental development occurred in Manhattan, according to a report by the real estate marketing and consulting firm Nancy Packes Inc. But for projects slated to hit the market in 2013 and 2014, it’s a different sto-

ry. Indeed, 70 percent of the city’s new rental developments launching this year and next is actually slated for Brooklyn and Queens — with a strong emphasis on Brooklyn. This month, using data from real estate

website StreetEasy, building permit applications from the city’s Department of Buildings, news reports and our own research, The Real Deal culled together a compendium of new residential projects with 20 or more units in BROOKLYN ILLUSTRATION BY2012 CHRIS EDE www.TheRealDeal.com March 00

3/1/13 1:13 AM

NEW DEVELOPMENT prime Brooklyn neighborhoods. According to our analysis, there are approximately 100 of these buildings — with at least 14,000 units — slated to hit the market in 2013 or later (see accompanying chart). The flood of new inventory will be concentrated predominantly in Downtown Brooklyn, where, in addition to the projects by Steiner and AvalonBay, the Stahl Organization is building a 378-unit condo-and-rental tower at 388 Bridge Street, and the Dermot Company is developing 326 rental apartments at 66 Rockwell Place. Williamsburg, of course, also remains a prime location for new development, with at least 3,000 units slated to come online in the next several years. The Chetrit Group, the Manhattan-based developer, is planning a 234-unit residential building at 500 Metropolitan Avenue in that neighborhood. And after securing a $50 million construction loan last year, the investment and development company LCOR is now erecting a 232-unit rental building at 250 North 10th Street. The Brooklyn projects in the pipeline tend to be substantially bigger than what’s being built in Manhattan. That’s partly due to the sweeping 2004 rezoning of Downtown Brooklyn, which allowed developers to build residential towers on a scale impossible in Manhattan, where few viable development sites remain, and the ones that do exist have largely been largely picked over. In wake of the rezoning, developers gobbled up prime sites in the neighborhood quickly and, in many cases, cobbled together lots that can accommodate hundreds of residential units. To assemble its Willoughby Street site, for example, AvalonBay, which is headed by CEO Tim Naughton, paid United American $125.5 million for 11 properties in a series of sales between 2008 and 2012. “Bigger projects are happening more and more [in Brooklyn] because of the [lower]

condo product. “I could sell out a 30-unit building overnight at record prices if I had a building to do it with,” said David Maundrell, founder of Brooklyn-based brokerage aptsandlofts.com.

Betting on rental

Clockwise from top left: Douglaston Development’s third Northside Piers tower in Williamsburg, a 510unit rental at 1 North Fourth Place; Jeffrey Levine from Douglaston Development; the Stahl Organization’s 378-unit tower at 388 Bridge Street; Two Trees’ Jed Walentas.

price of dirt [compared to Manhattan] and the scale of what you can build there,” said Ken Copeland, a partner at development firm FLAnk, which is building a 200,000-squarefoot residential building at 71 Smith Street in partnership with private equity firm the Carlyle Group. “Also, the city seems to be a little bit more pro-growth [in Brooklyn],

allowing for [zoning] variances.” While the flood of inventory in Brooklyn may please frustrated renters by slowing the steady uptick in rental rates, it will do little to satisfy the increasing appetite for Brooklyn

BROOKLYN’S NEW DEVELOPMENT PIPELINE Address

Neighborhood

209–231 McGuinness Boulevard

Greenpoint

510 Flatbush Avenue

Prospect Lefferts Gardens

33 Lincoln Road 505 Saint Mark’s Avenue

Prospect Lefferts Gardens

278 Sixth Street 248 North Eighth Street

Park Slope Williamsburg

267 Sixth Street 30 Washington Street 180 North Seventh Street The Bradford, 1562 Fulton Street

Park Slope Dumbo Williamsburg Bedford Stuyvesant

544 Union Avenue 1373 Lincoln Place

Williamsburg Crown Heights

316 Bergen Street 129–139 North Third Street

Boerum Hill Williamsburg

373 Wythe Avenue

Williamsburg

482 Franklin Avenue 354–356 Wythe Avenue

Bedford Stuyvesant Williamsburg

22 Caton Place

Kensington

226 Linden Boulevard

Prospect Lefferts Gardens

Total units

Crown Heights

53 Broadway

Williamsburg

85 Flatbush Avenue Extension 172 Montague Street

Downtown Brooklyn

277 Heyward Street 341 Eastern Parkway 785 Dekalb Avenue

Williamsburg Prospect Heights Bedford Stuyvesant

Brooklyn Heights

Chart continues on page 48

68 January 2013 www.TheRealDeal.com

046-049 Brooklyn dev se FINAL.indd 2

140 140 133 128 107 104 104 100 100 96 95 87 85 84 84 78 77 73 72 72 69 66 65 65 60

Developer

Building type

Paul Pullo Century Building Associates Tom Anderson Yosi Cohen 278 6th Street LLC Rieder Holdings Naftali Group Two Trees Heritage Equity Partners BRP Companies Heatherwood Partners Andrew Struzzieri Naftali Group Triton Realty Group Wythe Properties Yosi Cohen BJR Realty Corp. Hudson Companies Emory Brooks Adamamerica RE Chetrit Group Eli Stoll and Charles Dayan Joseph Templer Bluejay Management Sam Klein

TBD TBD TBD TBD TBD TBD TBD TBD TBD Rental Rental TBD Rental Hybrid TBD TBD TBD TBD TBD TBD TBD TBD TBD TBD TBD

Market-rate rents in Brooklyn have been on the rise for years. In 2006, the average monthly rent for a Brooklyn one-bedroom in a non-doorman building was $1,924, the Packes report found. In 2012, that figure had jumped to $2,511. Over the past several years, that rental market strength, combined with low interest rates, has prompted Brooklyn developers to build rentals rather than condos, especially since banks are still reluctant to finance condo projects in the outer boroughs. (With the economy improving, lending standards for Manhattan condos have loosened, but banks are still somewhat wary of large projects in Brooklyn, sources said.) “Banks are just more comfortable with rentals on the large-size scale,” said Barrocas. “With construction loans over $100 million, it does become a lot more challenging to have the numbers make sense on a condo basis [in Brooklyn], especially when it comes to putting in the amount of equity that is required in today’s market.” Meanwhile, some developers of Brooklyn projects that were originally intended as condos switched to rentals after the recession, many with an eye toward selling their leased-up buildings to REITs or institutional investors, which have been snapping up rental projects in the borough. These big-time players have been scouring the market to purchase completed rental buildings in the city, viewing them as a safe haven for capital, experts said. And they see Brooklyn rentals as likely to appreciate over time. In 2011, for example, the Dallas-based investment management firm Invesco paid $57.5 million for a 95-unit leased-up rental building called Arias Park Slope at 150 Fourth Avenue, said Ofer Cohen, founder and president of Brooklyn commercial brokerage TerraCRG. Then in March 2012, Invesco bought a 74-unit rental at 75 Clinton Street in Brooklyn Heights for $50.8 million. (Invesco bought the building after it went from condo to rental and was leased up.) And in May 2012, American Realty Advisors bought a 62-unit rental project at 111 Kent Avenue in Williamsburg from developer Laurence Gluck of Stellar Management for $55.5 million, or $895,000 per apartment — a record for a multi-family building in Brooklyn. Gluck had purchased the stalled condo project from Garrison Investment Group for $24.6 million in 2011 and put the finishing touches on the building, launching it as a rental. Given the appetite for these types of properties, it’s not surprising that trading volume for multi-family properties was heavy in Brooklyn in 2012. Indeed, there were 323 multi-family transactions for the year, totaling $1.4 billion, according to investment sales firm Ariel Property Advisors. Compared to 2011, that’s a jump of nearly 50 percent in both dollar www.TheRealDeal.com March 2013 47

3/1/13 1:13 AM

NEW DEVELOPMENT

and transaction volume. Multi-family properties in prime neighborhoods such as Williamsburg and Park Slope saw prices reaching $1,000 per square foot — around the same prices condo buyers pay in those areas, according to Ariel’s data. Deals for Brooklyn development sites also nearly doubled year-over-year in 2012, with 109 transactions totaling $523 million. For developers, the fact that these transactions are yielding roughly the same profit as selling individual condos is an added incentive to build rentals. “If you can sell the rented buildings for the same price or close to the same price for which you would sell the condos, and you can exit your investment much quicker, why would you even bother [with a condo]?” Cohen said, noting that renting a 100-unit building in Brooklyn takes around three months, but selling out a building of the same size usually takes more than a year. Maundrell said Brooklyn condo prices would need to increase significantly for this trend to stop. “Until the end-user starts paying a lot more, developers are going to continue to build rentals,” he said. And of course, some developers simply prefer to build rentals. For example, longtime Brooklyn developer Two Trees has “an internal philosophy to build as many rentals as we possibly can,” said Jed Walentas, a company principal. “We like to own our real estate long-term,” he added. “Wherever we can afford to do rentals, that’s what we’re going to do. That’s our strategy in general and it’s not related to the market.”

The players Major national and Manhattan-centric developers have ramped up their involvement in Brooklyn in the last year. Sources attribute that to high Manhattan land prices and the greater availability of large parcels in Brooklyn. “Larger developers don’t want to do 30,000-square-foot buildings,” Maundrell said. “They want to start at 100,000 square feet.” Manhattan developers FLAnk and the Brodsky Organization, as well as national players like the Lightstone Group, are gearing up to launch their first Brooklyn projects in the next two years, joining established Brooklyn players like Douglaston Development, the Hudson Companies, Two Trees and Forest City Ratner. FLAnk — the developer behind Manhattan projects like the Abington condo in the West Village and 1 North Moore Street in Tribeca — is still determining whether to 48 March 2013 www.TheRealDeal.com

046-049 Brooklyn dev se FINAL.indd 3

Clockwise from top left: Developer Douglas Steiner, who’s building a 720-unit rental on Schermerhorn Street; 72 Poplar Street, where the Daten Group is converting a former police station into condos; 111 Kent Avenue, once planned as a condo, was bought by American Realty Advisors as a rental.

do condos or rentals at its newly acquired Smith Street site, Copeland told TRD. The company had been considering entering the Brooklyn market for more than five years before partnering with Carlyle, he said. “We’ve naturally become more aware of Brooklyn,” he said. “It has emerged as a cul-

“Bigger projects are happening more and more [in Brooklyn] because of the [lower] price of dirt [compared to Manhattan] and the scale of what you can build there.” KEN COPELAND, FLANK

BROOKLYN’S NEW DEVELOPMENT PIPELINE Building type

Address

Neighborhood

259 Pacific Street

Cobble Hill Clinton Hill

60 59

Quinlan Development Group

Putnam Court, 40 Putnam Avenue 510 Flatbush Avenue

Prospect Lefferts Gardens Bedford Stuyvesant

215 Flatbush Avenue 64 Bayard Street

Prospect Heights Williamsburg

487 Keap Street 202 Eighth Street 310 North Seventh Street Triangle Court, 442 Grand Street

Williamsburg Gowanus Williamsburg Williamsburg

59 Frost Street Sterling Terrace, 834 Sterling Place

Williamsburg Crown Heights

382 Lefferts Avenue 2514 Albemarle Road

Prospect Lefferts Gardens Flatbush

692 Bushwick Avenue

Bushwick

1000 Broadway 112 Emerson Place

Bushwick

56 54 53 52 51 51 50 50 47 46 46 43 37 35 32 32 31

Thomas Anderson

437 Herkimer Street

30 29 28 28 27 26

Isaac Rosenberg

Total units

Clinton Hill Carroll Gardens

Sackett Union, 291 Union Street 333 Carroll Street

Park Slope

436 Kent Avenue

Williamsburg

329 Sterling Street

Prospect Lefferts Gardens

196 Macon Street

Bedford Stuyvesant

65–69 North Sixth Street 291 Metropolitan Avenue 132 Ocean Parkway

Williamsburg Williamsburg Kensington

Developer Dunn Development The Bridge Scott Domansky Hudson Companies

Chetrit Group JDS Development Heritage Equity Partners Ideal Development Simon Dushinsky Eli Karp, Hello Living Tali Realty LLC Abe Caller Richard Lopez Joe Goodman E&M Realty Holdings Alchemy Properties Isaac Fishman Al Lieber Sharon Hakmon Silverstone Property Group Joe Goodman Lennard Katz

TBD TBD Rental TBD TBD TBD Rental Rental TBD Rental TBD TBD TBD TBD TBD TBD TBD Condo TBD TBD TBD TBD TBD TBD TBD

Chart continues on page 49 BROOKLYN ILLUSTRATION BY SHAPE2 www.TheRealDeal.com March 2012 USA 00

3/1/13 1:13 AM

New Development tural touchstone. Kids are moving straight to Brooklyn as opposed to Manhattan.” Brodsky is currently constructing an ultraluxury condo on Manhattan’s Upper East Side at 135 East 79th Street. But entering the Brooklyn market offered a way to return to its core business: rentals. “Our primary business has been rental housing for decades,” said Dean Amro, a principal at the company and the grandson of company founder Nathan Brodsky. “We felt that in the last 10 years, it has been getting harder and harder to find what we viewed as good rental sites” in Manhattan. Brodsky plans to break ground on a 440unit rental project at 336 Flatbush Avenue Extension in Downtown Brooklyn in the first quarter of 2014, and is currently scouting out other opportunities in the borough. Meanwhile, Manhattan-based developer the Naftali Group closed on a 90,000-squarefoot development site at 316 Bergen Street in Boerum Hill last May, and is slated to build an 85-unit rental there in partnership with real estate investment management firm AEW Capital Management. And Lightstone, which has been ramping up its presence in New York over the last year, is awaiting approval to bring 700 residential units to a site at 363-379 Bond Street near the Gowanus Canal (see related Q&A on page 63). Despite increased competition, industry experts said local players may still have an edge in the Brooklyn market. “The players that are currently in the market understand it better than anyone else and they have a huge advantage,” Barrocas said. “You have a good core of developers who have grown and been very successful in Brooklyn.” Two Trees, for instance, spent 10 years assembling one of the three sites it’s currently developing in Brooklyn: the 17-story mixeduse project on Dock Street in Dumbo, which will include a 300-seat school. The company is also planning a 100-unit residential development at 30 Washington Street in Dumbo, as well as a 300-unit rental near Fort Greene’s Brooklyn Academy of Music (see related story on page 28). Two Trees is developing the 11-acre former

Domino Sugar Factory site in Williamsburg, where it has recently floated a plan to build 630,000 square feet of office space plus residential units and open space. Longer term, also, Forest City Ratner has more than 6,400 residential units coming down the pike at Atlantic Yards over the next two decades, with its pre-fabricated B2

project on Dean Street being the first tower to rise, with 363 rental apartments.

Condo crunch With few condos in the Brooklyn construction pipeline, would-be homebuyers are growing increasingly frustrated by the inventory shortage. “We’ve opened five condo buildings in the last five months or so,” Maundrell said. “Each building has had no less than 250 people attend the opening night. Every building has

Clockwise from op left: a rendering of 88 Willoughby Street, an 861-unit rental AvalonBay is developing; a rendering of 30 Henry Street, which will include five full-floor condos; the Arias Park Slope, a 95-unit rental at 150 Fourth Avenue, which Invesco bought fully rented; AvalonBay CEO Tim Naughton.

Brooklyn’s new development pipeline Address

Neighborhood

168 Kosciuszko Street

Bedford Stuyvesant

836 Dekalb Avenue

Bedford Stuyvesant

184 Joralemon Street

Brooklyn Heights

392 St. Marks Avenue

Prospect Heights

682 Bushwick Avenue 207 Skillman Street

Bushwick Clinton Hill

329 Lincoln Road 333 Atlantic Avenue 376 Franklin Avenue 260 North 9th Street

Prospect Lefferts Gardens Downtown Brooklyn Clinton Hill Williamsburg

248 Duffield Street 731 Dean Street

Downtown Brooklyn Prospect Heights

149 Kent Avenue 85 Fourth Avenue

Williamsburg Boerum Hill

146 South Fourth Street

Williamsburg

187 4th Avenue

Park Slope

71 Smith Street

Downtown Brooklyn

Total Units

Developer

26 24

George Roth

24 24 23 23 22 22 20 20 TBD TBD TBD TBD TBD TBD TBD

United American Land

Building type

Sam Polatsekg Joe Goodman Richard Lopez Mier Schweid Shampa Chanda Michael Tsoumpas Tomer Erlich Misc Investment Group United American Land October Enterprises L+M Development TBD South 4TH Realty 168 Realty Development FLAnk

TBD TBD Rental TBD TBD TBD TBD TBD TBD Rental TBD TBD TBD TBD TBD TBD TBD

Source note: Data is from StreetEasy, the Department of Buildings and TRD’s research. Only projects slated to have 20 units or more were included. Projects include those launching in 2013 or later.

68 JanuaryOF2013 www.TheRealDeal.com PHOTOGRAPH THE ARIAS FOR THE REAL DEAL BY DEREK ZAHEDI

046-049 Brooklyn dev se FINAL.indd 4

sold out. For the most part, they were sold out within 24 hours of opening.” Even all-cash buyers are making offers above the full asking prices in order to secure units, Maundrell said. “People are very frustrated because you have viable buyers — 25 percent down-payment buyers — who can’t find a deal,” he said. While the end use for a lot of in-the-pipeline projects has yet to be determined, there are a few known condos in the works. Many of those projects tend to be small — usually less

than 20 units — so they didn’t make TRD’s list. The lower-unit count is likely due to the lack of financing available for larger for-sale projects. At 72 Poplar Street, for instance, the Daten Group is converting a former police station in Brooklyn Heights into 13 condo units, ranging in size from 1,500 to 4,000 square feet. And at the former home of newspaper the Brooklyn Daily Eagle at 30 Henry Street, Fortis Property Group is developing a condo building with five large full-floor units asking $3.39 million to $4.95 million. More developers are also likely to consider building condos again as land prices start to climb in Brooklyn and lenders become more comfortable with the idea of for-sale product outside Manhattan, experts said. “There’s a finite amount of land, and people want to hold on to it while land values and pricing in Brooklyn catches up to where it could eventually be,” said Barrocas. Some are dipping their toes in the water by building hybrid towers — which include both condos and rentals and were popular in Manhattan in 2010 and 2011. Hybrids, Barrocas said, “give developers the flexibility with the bank to make it make sense.” Stahl’s project at 388 Bridge Street, for example, will have 234 rental units and 144 condos. Amro said he would consider building a Brooklyn condo as the market continues to evolve. In hindsight, he said, one Williamsburg conversion opportunity he passed up in 2009 now seems attractive. “As a rental, the price of the building was such that it wouldn’t have led to a good return,” he said. “To make the numbers work, we would really have had to do a condo. This was in 2009, when the world was looking a little more bleak than it is today. If that same building were available today at that same price, I probably would buy it and do a condo.” TRD www.TheRealDeal.com March 2013 49

3/1/13 1:14 AM

TH I S M O N T H I N

R EAL E STATE H ISTORY A look back at some of New York City’s biggest real estate stories

COMIN G THIS AP R I L

1983: Retail rent-control proposed in Albany

esponding to sharply rising rents squeezing shop owners, two members of the state legislature proposed a law to limit the increases landlords could impose on their retail tenants 30 years ago this month. Republican Senator Frank Padavan, from Queens, and Democratic assembly member Jerrold Nadler, from Manhattan, introduced the bipartisan measure, known as the Small Business Preservation Act. The law was similar to the powerful legislation that regulates how much landlords can increase rents on residential tenants in certain apartments. Proponents argued that landlords were doubling or, in some cases, tripling rents and that small businesses could not afford the new costs. The bill, which was introduced as the country was moving Congressman Jerrold out of the recession in the early 1980s, would have only applied Nadler, formerly a state assembly member to rents at stores with 100 or fewer employees. The Real Estate Board of New York, the industry’s main lobbying group, opposed the measure. The group’s president at the time, Richard Rosen, called the idea an “absurdity” that would be ‘’absolutely disastrous and impossible to administer.’’ REBNY won the day, and the bill was never voted into law.

1933: Lawmakers pass Depression-era foreclosure moratorium

Ten Year Anniversary Issue We invite you to join us in celebrating our 10th anniversary with a limited-edition issue of The Real Deal magazine. The April 2013 issue will look back at the stories that have made the biggest impact on the New York City real estate market over the past decade, highlighting the most colorful characters and biggest deals as the market went from boom to bust and back again. The issue will also chronicle The Real Deal’s own story—and the story of its readers—in covering the market as the industry’s leading publication. Sign up today.

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egislators in Albany approved a bill 80 years ago this month that blocked lenders from foreclosing on homes — even if the owner stopped paying down the principal. The new law gave residential homeowners an increased chance of holding on to their properties as the economy was crumbling during the Depression. However, the law, which was signed by Governor Herbert Lehman, was no panacea. It only protected homeowners who had fallen behind on paying down principal, but were current in their interest, insurance and taxes. For those who could not make those payments, the threat of foreclosure remained. The law took effect in July 1933 and had to be renewed annually. It was renewed each year (except in 1941, when it was renewed for two years) until 1949, when it was finally allowed to expire. But it didn’t stand without a challenge. In 1945, opponents argued their case before the U.S. Supreme Court, but the naGovernor Herbert Lehman tion’s highest court backed two lower courts that upheld it. When it finally did expire, the nation was in the early stages of the postwar boom, and few homeowners remained under threat of foreclosure.

1911: Notorious Haymarket building sold

he infamous Haymarket dance hall building, a hub of prostitution on Manhattan’s West Side, was sold 102 years ago this month. The sale of the Haymarket, which was located in the seedy Tenderloin neighborhood, further dimmed the lights on the city’s onetime red-light district. (The Tenderloin stretched from 23rd Street to about 42nd Street for roughly four decades until the early 1910s.) Investors purchased the three-story structure at 66 West 30th Street, at Sixth Avenue, along with other nearby properties. Their intent was to construct a larger commercial building, but those plans never materialized. The building first gained notoriety after William McMahon opened it as a dance hall in 1872. A year later it was renamed the Haymarket and began to thrive among the beer halls and theaters The infamous Haymarket circa early 1900s of the Tenderloin. McMahon retired in 1890, and after a short stint as a museum, the building was reopened by operator Edward Corey, once again, as the Haymarket. But the dance hall constantly struggled with the police, who were clamping down on the racy activity in the district. Ultimately, the city rejected the renewal of the establishment’s license, the New York Times reported at the time. The building was torn down several years later. Today, a one-story building owned by Pater Realty sits on the site. Compiled by Adam Pincus

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3/1/13 10:20 AM

Air Rights

Houses of the holy A look at the religious institutions lobbying to get inside the pearly gates of a rezoned Midtown East and cash in on air rights — and their spiritual counterparts who’ve already sealed deals around NYC

By Hiten Samtani he evangelist preacher Billy Graham is fond of saying that “God has given us two hands — one to receive with, and the other to give with.” But three Midtown religious institutions that want to cash in on the city’s Midtown East rezoning proposal are finding that their hands are tied. St. Patrick’s Cathedral, St. Bartholomew’s and Central Synagogue between them have just over 2 million square feet of unused development “air rights,” which could be worth anywhere from $400 million to $1.1 billion, according to widely varying expert views. These fabled places of worship were hoping that the Bloomberg administration’s proposed rezoning would finally allow them to reap the material rewards of these rights, but have found themselves just outside the pearly gates. The proposal aims to revitalize the 74-block area from 39th to 57th streets between Second and Fifth avenues. As The Real Deal and others have reported, the plan would incentivize qualifying developers to tear down old buildings in the business district and construct modern skyscrapers by allowing them to build higher by purchasing air rights from the city, through a “district improvement bonus” fund created to make neighborhood improvements. The plan is slated to go through the public review process, known as ULURP, this spring and, if approved, would allow developers to purchase building permits under the new rules in 2018. The plan also calls for a so-called “Grand Central Subdistrict” between 39th and 49th streets, in which developers would be able to purchase air rights from owners of landmarked buildings anywhere within the subdistrict as long as they first buy a chunk of the rights

Monsignor Robert Ritchie inside St. Patrick’s Cathedral on Fifth Avenue

to properties across the street). Unfortunately for the three holy houses, they are surrounded by other landmarked buildings, or by developments unwilling or unable to purchase the rights, so they cannot easily cash out. Moreover, the rezoning proposal

“Why would you come through a church if you could go to the city and avoid special permits and a long process?” Lawrence Graham, St. Bartholomew’s

through the city’s fund. But St. Patrick’s, St. Bart’s and Central Synagogue lie just outside the subdistrict’s borders, so they would remain subject to current city law, which restricts the sale of air rights for landmarked buildings to adjacent lots (or, with a special permit,

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makes the institutions’ air rights even harder to sell, according to Lawrence Graham, chief administrative officer of St. Bart’s, and a former executive vice president at Brookfield Office Properties. “It’s one thing to change the law and cause no harm,” Graham said. “But the

city will sell air rights that are essentially better than our rights.” Graham said under the current proposal, developers will not be interested in buying their air rights. “Why would you come through a church if you could go to the city and avoid special permits and a long process?”

In on the action Rachaele Raynoff, a spokesperson from the City Planning Department, which is overseeing the administration’s proposal, said that these religious institutions can take advantage of a special landmark transfers program that allows them to sell their air rights to developers across the street in a kitty-corner transaction. For the most part, however, sources say landmark transfers involve a lengthy and costly public approval process — up

to $750,000 — and are considered too much of a hassle. “Most developers, if it requires a ULURP, avoid it like the plague,” said Robert Shapiro, an assemblage expert who has put together parcels for Harry Macklowe’s Drake Hotel site and the Crowne Plaza Hotel in Times Square. So, hamstrung, the three institutions are pushing the city to offer them the same selling rights as landmarked buildings inside the subdistrict. “We all have slightly different views, but for the most part, our interests are aligned,” Graham said. “What we don’t want is to be perceived as fighting the effort to update the Grand Central District. We think that’s necessary.” Graham said the solution that would be the easiest for the city to implement is the creation of a special subdistrict akin to the Grand Central subdistrict. Joseph Zwilling, a spokesperson for the Archdiocese of New York, which controls St. Patrick’s, said the church is “in continuing contact with the city and remains hopeful that they will take their good plan and make it even better.” Still, the real estate industry is closely watching the drama unfold. Robert Von Ancken, an appraiser with Newmark Grubb Knight Frank commissioned by the city to determine the value of Midtown East air rights, said that “there is some movement” on the issue. But Mike Slattery, senior vice president of research at the Real Estate Board of New York, said that the city has been “firm so far” on its proposal. Religious institutions were hopeful, he said, that the city would tweak its stance as it did for the 1998 creation of the Theater subdistrict, which allowed Broadway theaters to sell air rights to sites located anywhere between 40th and 57th streets and Sixth and Eighth avenues. “The expectation was that a similar mechanism would be incorporated here,” he said. Meanwhile, NYU’s Furman Center for Real Estate and Urban Policy is also brainstorming for alternative solutions to the air rights debate with city officials and developers. Ideas floated have included borough-wide air rights transfers and the establishment of a central “air rights bank,” which would allow the owners of air rights to sell them to a bank and thus

PHOTOGRAPH FOR THE REALJanuary DEAL BY JAMES www.TheRealDeal.com 2013CHANG 00

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Air Rights see an immediate return on their rights, said Vicki Been, the center’s director. Developers could then purchase the rights from the bank when needed.

The cost of air How much these air rights would actually trade for if the churches and syna-

gogue were able to sell them is also up for debate. While some have suggested that these air rights could go for as little as $200 per square foot, one attorney specializing in land use and zoning, who declined to be named, put that number as high as $450 to $550 per square foot. That would

mean the combined rights of the three religious organizations could be worth as much as $900 million to $1.1 billion. Von Ancken cautioned that prices can vary “depending on where you are and on the transferability.” As a rule of thumb, he said that air rights tend to sell for about 60 percent of the value of land.

In an effort to put the current air rights debate into context, The Real Deal looked at those three religious institutions lobbying the city hardest to alter the proposal as well as others that are involved in the debate or that have sold air in the recent past in the city. Read on below.

Central Synagogue

(652 Lexington Avenue)

ubbed New York’s first “megashul” by the Wall Street Journal, Central is the longest continually serving synagogue in the city. After a freak fire in 1998, the 14,064-square-foot Neo-Moorish building at East 55th Street and Lexington Avenue was restored in 2001. The Reform Jewish temple has roughly 155,000 square feet of available air rights, according to the real estate data website PropertyShark. Those rights would be worth somewhere between $31 million and $85 million if they could be sold freely, based on experts’ estimates ranging from $200 to $550 a square foot. But the rezoning proposal, Graham said, essentially “drew a line around” the synagogue excluding it from the Grand Central subdistrict, and unless the city’s policy changes, there aren’t any “receiving sites” to purchase those air rights. “So they are basically without an option,” said Slattery. David Edelson, the synagogue’s president, said that Central has supported the lobbying efforts spearheaded by the churches. “We strongly support the initiative being taken by the Archdiocese and St. Bart’s,” he said. He said while the synagogue does not have a developer lined up, the majority of proceeds from any future sale of air rights would go toward “the upkeep of our beautiful building.” Central’s congregation of over 2,400 households includes real estate bigwigs like Jerry Speyer, Kent Swig and Bill Rudin. “It’s like a who’s who of commercial real estate in there,” said Howard Grufferman, a vice chairman at Colliers International Tri-State, who is not a member of the congregation. But he said even the combined influence of the heavy hitters in the congregation isn’t likely to sway the city. “Selling air rights is a difficult thing.”

St. Patrick’s Cathedral

(631 Fifth Avenue)

he seat of the Roman Catholic Archdiocese of New York, this 48,550-square-foot building was completed in 1878 and has been the site of Requiem and memorial masses for icons such as Babe Ruth, Vince Lombardi, Joe DiMaggio and Andy Warhol. It currently sees 5.5 million visitors a year, and last year, church officials an-

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Central Synagogue, which has roughly 155,000 square feet of air rights

St. Patrick’s Cathedral

Christ Church, which closed last month on a deal to sell about 70,000 square feet of air rights to the Zeckendorf brothers for $600 per square foot

St. Bartholomew’s, which has just under 650,000 square feet of air rights

nounced a three-year, $175 million restoration. Located on Fifth Avenue between 50th and 51st streets, the Neo-Gothic building has over 1.2 million square feet of available air rights, according to PropertyShark. These could be worth between $240 million and $669 million; however, the church lies half a block east of the Grand Central subdistrict. Shapiro, the assemblage expert, said the church has no options to sell its rights under the current proposal. “Where are they gonna go?” he said. “Nearby, you’ve got Rock Center that has all the air rights in the world. You could put [the rights] on top of Saks, but Saks

sold their own development rights to the Cohen Brothers [Realty Corporation’s] buildings.” All of the eligible nearby properties have “no need for air rights,” Zwilling said. “This is why it is so important to these religious institutions and other landmarked owners to be able to offer them to developers in a wider area. It would help with the revitalization of Midtown and be beneficial to these three houses of worship as well.”

St. Bartholomew’s

(325 Park Avenue)

his Byzantine-style Episcopal church, located between 50th and 51st streets,

was completed in 1918 and landmarked in 1967. It is located one block north of the Grand Central subdistrict. St. Bart’s has some 646,299 square feet of available air rights, which could be worth between $129 million and $355 million. Of the three Midtown East institutions profiled here, it has the most pressing need for funds. “Their building is in need of considerable repair,” said Von Ancken. In 2012, the outgoing rector Rev. William Tully told the New York Times that the restoration work could cost $30 million. The church has been attempting to sell its air rights for some time. In 1991, a state Continued on page 102

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VITAL STATS NAME: Margaret

Streicker Porres AGE: 37 TITLE AND COMPANY:

President, Newcastle Realty Services HOMETOWN:

New York City

BUILDING BLOCKS How many buildings does Newcastle Realty Services own? We have an interest in around 50 buildings with just over 2,000 units. We are in Manhattan, Brooklyn and Queens.

of time. Because of the numbers of agencies and people involved, we could not make repairs in a timely fashion. Unfortunately, the building did collapse. I was at the scene with the

When was Newcastle founded?

Department of Buildings, the fire department and the

I founded it in 2004. I had had another company called West

police department, and I went into labor.

Village Corner Realty. But I found that the name was limiting. When I was buying a nine-building portfolio in Chelsea, I de-

The beloved speakeasy Chumley’s is a tenant in

cided to start afresh.

that building. Will it still reopen? We look forward to Chumley’s reclaiming its place

How did you get into the real estate industry initially?

in the West Village, and every day we’re pushing

I spent my childhood playing with Legos and Lincoln Logs and

closer to that happening. It’s one of the most fa-

designing things out of cardboard. My background is in architec-

mous speakeasies from the Prohibition era. There

ture and construction. My undergraduate degree is in architecture

are a large number of city agencies and various

and I have two graduate degrees — one in architecture and one in

regulations in place which we’re slogging through.

development.

There are a series of rules governing [the property’s] use. Due to the length of time the building

It’s rare to find a female landlord in New York City. Have you faced any

has been closed, we’re running into some of those

struggles as a woman operating in the industry?

issues.

People remember me. It’s still an oddity [to be a woman in the industry], but I’ve been female my whole life and I intend to continue being female.

Have you ever had a drink there? I have, and I’ve bartended there, too.

LANDLORD LIFE What’s been your strangest tenant experience?

THE BOTTOM LINE

I have a running list. We had a tenant who invented his own religion. Part

How did the recession impact your business?

of it involved purification through water after whipping himself. He tiled

We had slower growth [during that time], but I’m

his entire apartment up to about the six-foot mark and then would fill the

proud to say nobody lost their job. I have always been

apartment with water to cleanse himself of his sins. His apartment would

a fairly cautious investor. If anything, [the recession]

leak, which is how we found out about the problem. He was ultimately put

reinforced my belief in fundamentals.

in an institution. Are you actively looking to acquire in 2013? Any more tenant horror stories?

We’re always looking. In this business, you have to con-

Currently, we’re dealing with a very serious situation. We’re assisting the Amer-

stantly keep your eye on what’s available. I focus on

ican Society for the Prevention of Cruelty to Animals, the Manhattan District Attorney’s office and the New York Police Department in dealing with a tenant who has slaughtered domestic animals in the hallways of his building. It’s actually a sub-tenant.

multi-family turnarounds. Right now, we’re transitioning into slightly larger asset sizes. Where in the past the standalone townhouse was interesting to me, I’m less focused on that asset size now.

You’ve attracted criticism for your dealings with rent-stabilized tenants in the past. [In 2006, the Village Voice named her one of the city’s worst landlords.] Do you have

You recently bought a 70,000-square-foot multi-family proper-

strategies for dealing with those criticisms?

ty at 380 Columbus Avenue for $50 million. Why was that an

New Yorkers are very passionate about their housing. Improving occupied assets after years

attractive opportunity?

of deferred maintenance can be a delicate balancing act, and one that we try to approach with purpose.

It was the first sale of the property in 60-some-odd years. It’s in a prime location directly across from the Museum of Natural History. The opportunity to buy that was something I wasn’t going to pass

Was the Village Voice’s criticism unfair?

up. There are 44 apartments and three retail units.

That was a long time ago. There is clearly another side to that story. In my mind, it’s part of the past, and I’d rather leave it like that.

Where does your capital come from? Two of my last three deals were friends and family syndication and

This can obviously be a stressful job. I heard you went into labor after a wall collapsed at

one was institutional. I’m transitioning mostly to institutional

one of your buildings on Bedford Street in 2007.

[lenders].

TRD

The Bedford Street building had been in a state of structural failure for an extended period

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Macro economics meet micro apartments Developers say tiny apartments are good business, but zoning changes are needed first By Tom Acitelli fter the proposal that Elisa Orlanski Ours worked on won the Bloomberg administration’s contest to design the city’s first micro-unit building, the Corcoran Sunshine executive started getting calls from developers. Five contacted Ours, who served as a creative and marketing consultant, asking questions about modular micro-unit development in New York City. “It’s really getting down to the fact that New York is really ready for a new topology,” said Ours, Corcoran Sunshine’s vice president for planning and design. The team that submitted the bid — nARCHITECTS, Monadnock Development LLC and the Actors Fund Housing Development Corp. — will create 55 apartments no bigger than 370 square feet at 335 East 27th Street (see related architectural review on page 58). But many are now asking whether micro-units are financially viable for developers to construct without special treatment from the city. And could they work in buildings that are not all micro-units? Indeed, the city not only provided the property for the low price of $500,000, but 2/26/13 also waivedhr15890_RELaw_9.5x6.75.pdf a zoning regulation that required an apartment in a new building to be at least

400 square feet. The city will not provide additional subsidies for the roughly $15 million project, but those contributions were big financial sweeteners given how costly and time-consuming it can be to challenge zoning regulations. Still, private developers who spoke to The Real Deal, including some of the contest’s

The upper limits of the project’s market-rate rents have not yet been released, but the 40 percent that have been set aside as affordable housing will range from $914 to $1,873 — depending on household size and annual income. Matthew Blesso, president of Blesso Properties, said his firm was considering

A micro-unit model on display at the Museum of the City of New York

Developers can squeeze more micro-units into buildings than studios at a slightly higher priceper-square-foot return, according to one analysis. finalists, said tiny micro-units would (and already do) financially pencil out. The only issue holding developers back, they say, are the zoning restrictions. They predicted, however, that if 335 East 27th Street commands rents on par with market-rate studio apartments, it will be 10:45:52 AM only a matter of time before the city lifts those zoning restrictions.

its submission — a 56-unit building called Max — well before the mayor announced the contest. Blesso and others said the city’s consistently high housing costs (coupled with strong demand for smaller affordable apartments) make developing micro-units appealing. “There are definitely a lot of people willing to live in smaller spaces to save money,” said

Blesso, whose submission called for units of no more than 250 square feet. Mayor Bloomberg backed that point up, noting that the growth rate for one- and two-person households “greatly exceeds that of households with three or more people.” (There are about 1.8 million one- and two-person households in the city, but only about 1 million studio and one-bedroom apartments, according to city figures.) One of the city’s leading developers, the Durst Organization, submitted a bid for a 60-unit building with apartments no more than roughly 300 square feet. Alexander Durst, the vice president who headed the firm’s contest effort, told TRD that micro-unit developments would work best in New York’s denser, more transit-oriented neighborhoods because the apartments are geared toward New Yorkers who spend a lot of time out of the home. The firm’s rough price analysis comparing micro-units and studios, provided to TRD, determined that a 305-square-foot unit could rent for $1,950 versus $2,550 for a 550-square-foot studio in the same neighborhood. Rent for micro-units would, in fact, be in the same range as Manhattan studio rents, which on average fetched from Continued on page 104

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The Right Decision www.TheRealDeal.com March 2013 57

2/27/13 10:26 PM

ARCHITECTURE REVIEW

JA M E S G A R D N E R

Stacking up ‘micro-units’

The winning design in the city’s competition for tiny residential apartments makes an art out of space-saving — and even brings a dramatic flair

BY JAMES GARDNER everal weeks ago, Mayor Michael Bloomberg announced the results of the city’s competition to design so-called micro-units for an affordable housing project to be built at 335 East 27th Street. It may take a wonk to feel much excitement at the prospect of such a competition, but the realities that undergird it are highly important, potentially exciting and possibly a little depressing. The winning team — which includes nARCHITECTS, Monadnock Development LLC and the Actors Fund Housing Development Corporation — was one of 33 entrants and will now design 55 apartments ranging in size from the microscopic 250 square feet to the merely tiny 370 square feet. Contemporary with the mayor’s announcement, the Museum of the City of New York opened a new exhibition, “Making Room: New Models for Housing New Yorkers,” that includes not only the winning entry, but also the runners-up, as well as renderings of similar projects in Seattle, Montreal, Tokyo and elsewhere. Both the mayor’s initiative and the museum’s exhibition address some important new sociological realities of New York real estate. The competition was, of course, a response to the city’s changing demographics and to the astronomical price increases that New York has witnessed in recent years. It is a testament to how expensive New York has become that these tiny spaces are being offered for between $914 and $1,873 a month — and those are the “affordable” units. (Those units represent 40 percent of the 55-unit project; the remaining market-rate units have not yet been priced.) But an ever-larger number of people are clamoring to live in New York City, and they are willing to sacrifice space for location. Add to this a postponement of adulthood, as more Americans are opting to attend institutions of higher education, and you get a tolerance for apartments not much larger than jail cells and designed according to the logic of a college dormitory. In the winning entry from nARCHITECTS, each unit will have nine-foot ceilings and a Juliet balcony, but the amenities will be shared common areas, such as lounges on each floor, where residents can host dinners and other events.

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In some cases, there will also be shared kitchenettes available on each floor. The building will also have a roof-top garden, a café, storage and a fitness room. To maximize space, each apartment will come

size — with none of the amenities. And while the new spaces are generally intended for single occupants or couples, back then spaces that were scarcely bigger were inhabited by entire families.

Clockwise: An exterior rendering of the winning micro-unit design by nARCHITECTS, which will be built at 335 East 27th Street; an interior rendering of the project, which includes units that have fold-up beds and other space-saving features; nARCHITECTS principals Eric Bunge and Mimi Hoang.

with a bed that can be folded up so that, by day, the space can function as a living room or office, and by night it can serve as a bedroom. In addition, the units will all have stall showers (rather than tubs). “It’s the way of the future,” the mayor declared. In a sense, these tiny apartments represent a return to an older conception of human inhabitation. In the tenements of the Lower East Side, in the conventillos of recent immigrants to Buenos Aires at the turn of the last century, in the chambres de bonnes ( maids’ rooms) on the top floors of old Parisian apartment buildings, a good part of the population lived in spaces this

On visiting some of the more awful and cramped prisons in Venice, the 19th-century French novelist Honore de Balzac claimed that he had seen dwellings in Paris that were far less spacious or appealing. But nARCHITECTS, whose principles are Eric Bunge and Mimi Hoang, has turned space-saving into an art. The firm is best known in these parts for their highly original Switch Building on Norfolk Street. As for this latest project, they are to be commended for their sensitive and economical use of the small spaces they had to work with. The exterior of the building as well is not

without its dramatic flourishes. According to renderings, it is largely rectilinear and is conceived as four vertical layers: Each is set cheek-by-jowl with the one before and recedes from the street in ever-darkening hues. The foremost and lowest is white, while behind it the layers recede in gradually deepening shades of gray, such that the darkest and tallest section of the development is in the rear. At the back, facing a patio, the windows are designed in a Deconstructivist style; they are of differing widths and are arrayed across the surface in a syncopated but harmonious fashion. One of the most noteworthy aspects of the new building is that it will be constructed entirely out of prefabricated units that are being constructed by modular manufacturer Capsys Construction in its Brooklyn Navy Yard factory. It’s being billed as the first multi-family building in the city to be created from these prefabricated parts, which will be about the size of shipping containers and will essentially snap into place and be stacked on top of another. Although nARCHITECTS’ design appears to be promising aesthetically, several entries from the other finalists were a little more dramatic. One especially charming design by Pocket Living, BFC Partners, Rogers Stirk Harbour + Partners and Alexander Gorlin Architects contained 75 units, the topmost part set back from the street. The façade on that proposal was entirely covered in an expansive curtain wall, and the interior walls were conceived as a rainbow of neon hues. Equally estimable is the Max — the project designed by Blesso Properties & Bronx Pro Group LLC, HWKN and James McCullar & Associates. That proposal included a Modernist cube of a building that suddenly goes crazy at the seventh floor. It appears as though the top has been lopped off at a slant, and the resulting space gives way to trees and a variety of spiky geometric shapes. Behind the mayor’s competition, I suppose, is the desire to create affordable housing less for the poorer segment of the population than for a whole subset of New Yorkers who are young and ambitious but who find themselves increasingly priced out of the Manhattan market. If such units as these can remedy that problem — and house actors, musicians, fashionistas and poets — then they may indeed become, as the mayor predicted, “the way of the future.” TRD

BUILDING PHOTOGRAPHS COURTESY OF NARCHITECTS; EXTERIOR, © MIR; INTERIOR, © LEDAEAN

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Q&A

Gowanus gets ready

The industrial Brooklyn neighborhood is seeing speedier sales and increased prices as buyers snap up land in the hopes of a rezoning BY MELISSA DEHNCKE-MCGILL owanus is the Williamsburg of 10 years ago. That’s according to one residential broker working in the gritty, up-and-coming industrial Brooklyn neighborhood. But the area is clearly on the fast track to gentrification, with trendy stores and restaurants like Littleneck clam shack, Fletcher’s Brooklyn Barbecue and the bakery Four & Twenty Blackbirds attracting attention, as well as new retailers like Whole Foods, Dinosaur Barb-B-Que and, yes, the hipster-sounding 40,000-square-foot Royal Palms Shuffleboard Club gearing up to open. This month, The Real Deal talked to residential and commercial brokers to get a lay of the land in Gowanus, which is sandwiched between the far-more-established neighborhoods of Carroll Gardens and Park Slope and abuts the notoriously polluted canal of the same name. Those brokers say that Gowanus has seen both speedier sales and a spike in prices in the last year, even though some properties close to the water were affected by Hurricane

Ruthanne Pigott

president, Brenton Realty How is overall residential sales volume doing in Gowanus these days, and how does that compare to a year ago, two years ago and during the boom? Overall residential sales volume in Gowanus is not huge since Gowanus is a small area and there really is not a tremendous amount of residential property. Much of Gowanus is zoned M1-2 [for light manufacturing] even though residential homes already exist in the zone. The difference I see today versus a couple of years ago is there is an excitement about the Gowanus area. There’s been talk about a possible rezoning of Gowanus to allow more residential projects. If approved, what impact do you think that would have on the neighborhood? The proposed rezoning would have a tremendous impact on the area. It’s what’s creating the excitement and curiosity about Gowanus. The buyers are educated about the area and most are coming from Manhattan. If the rezoning goes forward, prices will skyrocket. Which price ranges and housing types are performing best right now in Gowanus? The prices of houses have increased a lot. A few years ago, houses were priced anywhere from $680,000 to $850,000. Now you would not see a house in Gowanus on the market for under $1 million and most are between $1 million and $1.5 million. That’s a huge jump. Condos are doing well, too. My company recently closed on a 860-square-foot, two-bedroom condo in the Novo at 343 Fourth Avenue for 76 January 2013 www.TheRealDeal.com

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$725,000. The biggest transfers in the last year or so have been for empty warehouses, garages and vacant lots, all within the M1-2 zone. These properties are trading for about $350 to $550 a square foot. Obviously, they’re being held for future [residential] development in the event the rezoning is accepted. What are the biggest challenges to selling real estate in Gowanus? The challenge with some of these properties is that, in a way, you’re selling the future of Gowanus in terms of the proposed rezoning. Right now, in order for a buyer to increase the size of their residential building in the M1-2 zone, they would have to seek a zoning variance. Whereas, if the proposed rezoning were already in place, the buyers would be able to proceed without this extra red tape. The new Whole Foods, which is slated to open this fall, is obviously going to have a huge impact on this area of Brooklyn. Are you beginning to see any impact on the residential market? Surprisingly, I’m not seeing the impact of Whole Foods yet. I am usually the one educating the buyers about this development. It seems that Park Slopers are more aware of it than new buyers to the area of Gowanus. But once it’s built and open, I do believe there will be another jump in prices. How will the Lightstone Group’s planned 700-unit residential project near the Gowanus Canal impact the residential market in the neighborhood? The project, I believe, may speed up the rezoning. Lightstone got a huge variance to build this project. Many who have bought in Gowanus, and are buying in Gowanus, are going to push for the rezoning so that they can build and extend their own properties. I think it will become too

Sandy. They note, for example, that townhouses are now hitting the market for at least $1 million, whereas last year they had asking prices in the $800,000 range. But relatively speaking, the area still has little inventory, so the number of sales is low. Developers and investors are, however, betting on the neighborhood and snapping up whatever properties come on the market in the hopes that a proposed (albeit delayed) rezoning, which would allow for more residential housing, eventually gets approved. “The area is seeing an influx of large developers looking to land bank industrial properties in the hopes of being rezoned to residential or mixed uses in the future,” said Jacob Tzfanya, an associate director at the Brooklyn-based commercial firm CPEX Real Estate. And there are projects already underway, including the Lightstone Group’s proposed massive 700-unit residential project, which brokers say will only spawn more new construction. For more on the rezoning, retail prices along the transitioning Third Avenue strip and other upcoming developments, we turn to our panel of experts.

cumbersome, and unfair, for each property owner to seek a variance when a variance has already been given for this huge residential building. The northern section of Third Avenue in Gowanus has seen the opening of a number of new restaurants and stores lately, such as Littleneck clam shack, Twig Terrariums, Fletcher’s Brooklyn Barbecue and the bakery Four & Twenty Blackbirds. What is the range of retail rents in the area, and how has that changed over the past few years? Rents for commercial spaces in Gowanus are going up. A couple of years ago, I would say commercial rents were asking about $35 per square foot, and now they are asking about $55. I believe it will continue to grow along Third Avenue, and I think it’s helping to bring attention to Fourth Avenue — which has struggled to attract new restaurants and shops — as an option for retail.

Justin Dower

senior vice president, Ideal Properties Group Where does the neighborhood stand in terms of gentrification? The rezoning of Fourth Avenue and parts of Third Avenue four to five years ago started the transition and the peak is coming. The Whole Foods is going to be the badge of completion for that transition, and 40,000 square feet of shuffleboard [at the soon-to-open Royal Palms Shuffleboard Club] won’t hurt either. With Dinosaur Bar-B-Que coming, it’s only a few months, or maybe a year, until we get Starbucks. That will be the culmination of the transition.

Which price ranges and housing types are doing best right now in Gowanus? The vast majority of Gowanus is comprised of single-, two- and three-family residences — brick and vinyl siding and the very random and rare brownstone. So condos and co-ops aren’t really relevant. Prices are in the $1-to-$2 million range. The multi-family and mixed-use buildings are the hottest commodity in the neighborhood — mixed-use more so. Also, the heartbeat of Brooklyn is its small business owners, and Gowanus, being the Williamsburg of 10 years ago, is attracting a lot of those small business owners. All of these folks are looking to install their business there. If they have the capital, most of them are looking to buy a building rather than paying inflated rents for long periods of time. How will the Lightstone Group’s planned 700-unit residential project impact the residential market in the neighborhood? If a major [company] like Lightstone is still willing, after the calamity of Sandy, to go ahead with their plans to build 700 residential units on top of a flood zone, many more investors [will feel safe] doing the same. Having a high-end building along a Superfund site is not going to immediately drive rents up. Are there any other upcoming residential projects that you think are going to have a large impact on the market? There aren’t other very large residential projects on the horizon, but a lot of the developers have been reading between the lines as far as the [proposed] rezoning and they’ve built hotels. Investors don’t put up hotels in Gowanus because they are looking to make money on hotel investments; they’re waiting for the rezoning. Once it happens, they can immediately flip these hotel rooms into residential spaces and rentals. www.TheRealDeal.com March 2013 63

2/28/13 11:14 AM

Q&A The northern section of Third Avenue has seen the opening of a number of new restaurants and stores lately. What’s the range of retail rents in the area? Rents have risen 20 percent in the last two to two and a half years. There are still deals to be had on Third Avenue, mainly because a once very unpopulated area is becoming more heavily trafficked. … Many of these tenants — Littleneck, the Pines, Runner & Stone — have to make major investments in the infrastructure of the building. Landlords are willing to accept lower rents to attract that investment and end up with a more valuable space down the road. … Storefronts where high-end businesses already exist are commanding in the area of $50 per square foot and in some cases higher. There is only one way to go and it’s up. Which parts of Gowanus are doing best and which are struggling the most? Hurricane Sandy really changed things down toward the canal within flood Zone A. We are experiencing an exodus. A lot of people lost a lot of property and the majority of flood insurance does not cover sea water, only fresh water. The insurance companies are finding loopholes for paying people, and businesses are losing their shirts — even some very large industrial uses. There is a printing company that can’t recover $500,000 in lost equipment and inventory and they are getting out of dodge. How long are properties staying on the market in Gowanus, and how does that compare to the recent past? There is a scarce level of inventory and a high level of interest. A lot of properties [are selling] within a couple of weeks of marketing efforts with offers at or over asking price. What are the most surprising trends you’re seeing in the Gowanus market? The price per square foot on the rental side. I didn’t think we would be breaking $50 a foot quite so soon; 433 Third Avenue [which Ideal is leasing] is really a benchmark. Getting these sorts of rents in this area two years ago was an impossibility; now it’s quite easy. People have no qualms about paying the same premiums they would in Park Slope.

Eileen Dolan

salesperson, AC Lawrence How is overall residential sales volume doing in Gowanus these days? Gowanus is recovering from the storm and continuing to increase in residential sales this year compared to last year. The area experienced its highest number of residential sales in late 2008. 64 March 2013 www.TheRealDeal.com

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What’s going on with residential prices in Gowanus these days? Prices are generally up from last year, with renovated residences leading in growth. The area experienced a spike in sales price in 2006 and 2007, followed by relatively steady progress over the last five years. Depending on the location of the property, some owners are seeing their first decrease in value in many years, although a very small decrease. Which price ranges and housing types are doing best right now in Gowanus? Newly constructed townhouses. Smaller apartments are [also] doing particularly well. Condo townhouses with top-drawer renovations are getting excellent prices. Are there any upcoming residential projects that you think are going to have a big impact on the market? There is a new luxury residential development of 44 units at Third Avenue and Bond Street. What are some of the new trends you’re seeing in the Gowanus market? The new trend is new construction. With new development, the area is no longer a destination for urban pioneers.

Jacob Tzfanya

associate director, CPEX Real Estate There’s been talk about a possible rezoning of Gowanus. If approved, what impact do you think that would have? The proposed rezoning has been in discussion for some time now — whether that will come to fruition is yet to be seen. There are strong lobbies on both sides of the issue. If it does occur, it will tremendously increase the value of those properties rezoned to residential uses. Currently, the area is seeing an influx of large developers looking to land bank industrial properties in the hopes of being rezoned to residential or mixed uses in the future. Are there any upcoming residential projects that you think are going to have a big impact on the Gowanus market? Yes. The numerous development projects in construction or in planning on Fourth Avenue as well as the Gowanus Green [a mixed-use project on a brownfield site on Smith and Fifth streets]. What’s the retail rent range in the area, and how has that changed recently? Retail rents have steadily increased over the past year. The current range of retail rents in Gowanus is from $25 to $40 per square foot, depending on size and location. The past year has seen demand grow exponentially, pushing vacancy rates down.

Ken Freeman

senior vice president of sales, Massey Knakal Realty How is overall investment sales volume doing in Gowanus these days? Last year was a remarkable year for investment sales in Gowanus. I sold the PowerHouse building, which has sat unused for over 20 years. The former Toll Brothers site went under contract. The Figliolia Plumbing building at 420 Carroll sold. The Verizon parking lot at 300 Nevins sold. Each of those were relatively large transactions for Gowanus, and to have all of them happen in one year was breathtaking. In addition, Whole Foods actually commenced construction and the EPA demonstrated that at some point in my lifetime the Gowanus Canal will be cleaned of toxic sludge. There’s been talk about a possible rezoning of Gowanus to allow more residential projects. Do you see that happening? If so, how would it impact real estate? The Gowanus rezoning is inevitable despite its previous delays. The most likely result is that a new mayoral administration will reevaluate the rezoning and the community will go through a formal process of balancing various interest groups against each other. It will take a long time, but there is too much pent-up demand for it to not happen. Are you seeing an impact of the under-construction Whole Foods? I am a believer that Whole Foods will dramatically affect the market. I have watched for eight years as Forest City Ratner planned, then eventually built the Barclays Center. Nothing happened to the surrounding real estate until the moment the arena opened, and then everything became sizzling hot. I think it’s the same with Whole Foods. I think the moment it opens, everyone will want a piece of the surrounding real estate. Are there any upcoming residential projects that you think are going to have a big impact on the market? I think if [philanthropist] Joshua Rechnitz follows through and develops the PowerHouse building [into an exhibition center] that will have a major impact on the area. There are enough residential developers sitting on sites that there will be plenty of housing. What will really differentiate the neighborhood is a cultural centerpiece, which is what that project provides. I would also like to publicly request someone build a “Chelsea Piers” on the Gowanus; the neighborhood could use it.

What is the range of retail rents? I had lunch at Fletcher’s today and heartily endorse the mac and cheese. It’s been great seeing the pioneers populate that stretch of Third Avenue. The quality of those restaurants demonstrates the creative talents in Brooklyn. The appeal of that location is that on Seventh Avenue you need to pay over $100 per square foot for those storefronts; on Fifth Avenue, that number is closer to $80; on Third Avenue it’s $45, which allows more leeway for new businesses. It will take a rezoning before all the storefronts around there are filled.

Gina Castellano

salesperson, the Corcoran Group How is overall residential sales volume doing in Gowanus these days? There were five houses in our listing system that sold last year. As of right now, there are nine houses on the market, so already this year the townhouse market has doubled in the first six to seven weeks. The property I just put on the market got an accepted offer after seven full days on the market, but with [only] five full days of showings. I showed it about 40 times with no public open house and we had six offers — two all-cash — all over the asking price. I can’t tell you that’s an indicator of everything [that’s going on], but that really says something about the amount of inventory on the market. Everybody is after the same property. What’s going on with prices? Clearly they are increasing. The [above-mentioned townhouse] is the first property I sold in Gowanus. But all of these houses that are on the market now are well over $1 million. The ones that sold last year were an average of about $880,000. Agents are pricing according to what the market is now because of the inventory. What sort of changes have you witnessed in Gowanus in the last few years? My kids go to school [in Gowanus] and when they started in 2007–2008, there was nothing down there. Now you don’t have to cross over Fourth Avenue toward Park Slope or go across the bridge into Carroll Gardens to get something to eat. There’s no longer a void between the two neighborhoods. Now there is Powerplay [Sports Center], Four & Twenty Blackbirds and Fletcher’s Barbeque, among others. On Seventh Street, there’s the Bell House, a big nightclub. I was waiting at my kid’s school and reading Gwyneth Paltrow’s Goop website on my phone and it mentioned ShapeShifter Lab, the experimental music place that I happened to be sitting outside of. People are now scoping out Gowanus as a destination. TRD www.TheRealDeal.com January 2013 79

2/28/13 11:15 AM

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American Dream coming too late for Super Bowl? The long-stalled American Dream mall project in the Meadowlands failed to resume construction in January as predicted by Gov. Chris Christie, and could in fact not be open in time for the Super Bowl at nearby MetLife Stadium next year, various news outlets reported. Initial construction on the 4.8 million-square foot project, then

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known as Meadowlands Xanadu, began in 2004. Plans called for a project with entertainment venues, outdoor amusements, a hotel, office space, retail and even

indoor skiing. But the project was delayed, and the site had sat mostly dormant since full-time construction was suspended at the site in 2009. Christie announced in 2010 that Triple Five, the owners of Mall of America in Minneapolis, would take over the project and have it ready for the 2014 Super Bowl at the MetLife Stadium, where the Jets and Giants play, the Bergen Record reported. One reason for the construction holdup could be a lawsuit filed in June

by the Giants and Jets seeking to keep the mall closed on game days. Last month, Christie said he believes a deal is nearing between Triple Five and the football teams, according to a story in the Record. “I’m hoping we’re going to get that done very quickly,” he said.

LONG ISLAND

South Shore home sales drop post-Sandy: Report The number of home sales on Long Island’s hurricaneravaged South Shore dropped in the fourth quarter, while North Shore sales and prices increased, Newsday reported. Real estate

transactions on Nassau County’s South Shore declined by 2.5 percent in the last three months of 2012, compared to the same period a year earlier, according to data from brokerage Douglas Elliman. That time period includes Oct. 29, the day Hurricane Sandy struck the island, causing widespread destruction and damage to homes. Since then, sales have been delayed as lenders await new appraisals, Newsday reported. In the overall Long Island market, however, the median home price rose 3.2 percent to $350,000 in the fourth quarter, up from the same period of 2011. On Nassau County’s North Shore, the fourth quarter saw 27.7 percent more home sales than the same period of 2011. That uptick is due in part to sellers rushing to close deals on luxury homes by the end of 2012 to avoid rising capital gains taxes, Newsday said.

CONNECTICUT

UConn campus set to move Downtown

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Gov. Dannel Malloy last month announced a $2.1 billion plan to invest in programs and infrastructure at the University of Connecticut, including $70 million to relocate UConn’s West Hartford campus to downtown Hartford, the Hartford Business Journal reported. UConn issued a request for proposals seeking 150,000 square feet of space and 850 parking spaces from downtown landlords and property owners. The school

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had originally targeted the Travelers Education Center at 200 Constitution Plaza for relocation, but that site was found to have asbestos and space constraints. The empty 103,000-square-foot office building at One Talcott Plaza could now be the front-runner for relocation, the Journal reported. A deal could involve UConn buying that building and constructing an additional office near the site, but no plans have been finalized. Malloy also announced plans to expand UConn’s Stamford campus. Compiled by Andrea Cetra

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NATIONAL MARKET REPORT

Las Vegas at night

The onetime home of President Ronald Reagan

Pacific Palisades President

Ronald Reagan’s former home has sold for $5.21 million, more than $200,000 over its asking price, CNBC reported last month. The four-bedroom, four-bathroom mid-century modern ranch in Pacific Palisades hit the market in December. The president and his wife, Nancy, lived in the 4,764-square-foot house from 1957 until 1981, when they moved to the White House. Michael Jordan’s new mansion

Las Vegas

borhood, developer Michael Breheny is planning an $80 mil-

Construction began last month on a $415 million renovation

lion, 240-unit residential building with 18,000 square feet

of the Sahara casino and hotel, now called the SLS Las Vegas,

of shared office space. Breheny, the owner of Chicago-based

Palm Beach After two years and

the Wall Street Journal reported. Los Angeles nightclub op-

contractor Contemporary Concepts, is also teaming up with

$7.6 million worth of construc-

erator and hotelier Sam Nazarian partnered with Stockbridge

another Windy City company, Campus Acquisitions, on a

tion and renovations, basketball

Capital Group in 2007 to purchase the Sahara, a Las Vegas

proposed 12-story, 51-unit apartment building at 707 North

landmark once frequented by members of the famed Rat Pack.

Wells Street that will cost about $20 million. And a venture

The owners plan to open the SLS in 2014 as a mixed-use re-

led by Dan Moceri, cofounder of Convergint Technologies,

ultra-exclusive Bear’s Club, the

sort and casino with more than 1,600 guest rooms. As much

agreed to buy a property at 601 West Jackson Boulevard in

Huffington Post reported. Jordan

as $215 million of the renovation will be funded by the federal

the West Loop neighborhood, with plans to build a 198-unit

paid $4.8 million for the three-

EB-5 Immigrant Investor Program, which grants green cards

apartment building there. Chicago developer Enrico Plati

to foreigners who make job-creating investments. Nazarian

previously planned to build apartments on the site, currently

has already secured $150 million from EB-5 investors, who

a parking lot owned by the Illinois Institute of Technology, but

with — of course — a basketball

each agreed to put $500,000 into the project in exchange for

the deal fell through.

court.

a green card, according to the Journal.

Orlando

legend Michael Jordan and fiancée Yvette Prieto have moved into a South Florida mansion in the

acre property in 2010, and his new home boasts 11 bedrooms, a media room and an athletic wing

Los Angeles California-based Western National Realty paid $100.8 million

In the Orlando metropolitan area, buyers’ desire for new

to buy Ironwood and Fairway Palms, an expansive 496-unit

homes skyrocketed in 2012, the Orlando Sentinel reported.

apartment development, from J.P. Morgan & Co., Commercial

There were 5,762 closed home sales in the Orlando area in

Property Executive reported. The deal marks the final acqui-

2012, a 38 percent jump from 2011. And in the fourth quarter

sition in the $200 million Western National Realty Fund II.

of 2012, builders began work on 1,643 single-family homes in

Located in the Los Angeles suburb of Rancho Cucamonga, the

the area, a 47 percent increase from the final quarter of 2011.

property was constructed in 2002 and consists of two adjacent

Iverson lost his $4.5 million At-

There were 6,297 total housing starts in the area in 2012, up

apartment communities, with 260 units at Ironwood and 236

lanta mansion to foreclosure last

53 percent from 2011. Some estimates indicate that housing

units at Fairway, the Press Enterprise reported. The complex,

month after defaulting on a $1.5

prices in the area increased between 10 and 15 percent in 2012.

which is 95 percent occupied, will be managed by Western

Chicago A development boom is expected to add about 4,700 apart-

National Property Management. Fund II also included in-

Atlanta

Another hoops star, Allen

million mortgage, TMZ first reported. The six-bedroom, nine-bathroom house is now on the market

vestments in Utah and Colorado, according to Commercial

for $2.8 million, Fox News report-

Property Executive.

ed. Iverson also previously lost his mansion in Cherry Hills, Colo.,

ments to the downtown Chicago market by the end of 2014, Chicago Real Estate Daily reported. In the River West neigh-

The former Atlanta home of Allen Iverson

Compiled by Evan Bleier

to foreclosure.

68 March 2013 www.TheRealDeal.com

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ON THE MARKET Midtown’s Philip Lehman Mansion for sale A six-story commercial townhouse at 7 West 54th Street that was designated a New York landmark in 1981 is on the market for sale or lease. Jones Lang LaSalle’s Aaron Ellison and the Corcoran Group’s Carrie Chiang are jointly marketing the historic, 20,000-square-foot property, with asking prices of $49.9 million to purchase outright or lease 7 West 54th St. for $2 million per year. Building owner Lehm Holdings Inc. recently completed a $20 million renovation to restore the property to its original late-19th-century grandeur. The property, designed in the French Beaux-Arts style by architect John H. Duncan, was constructed in 1889 for Philip Lehman, the son of Lehman Brothers cofounder Emanuel Lehman, and his wife.

Stan Johnson tapped to market $39M UWS retail condo The Oklahoma-based commercial brokerage Stan Johnson Company — which recently announced plans to expand in New York City — was tapped to exclusively market the Class A retail condominium at 1991 Broadway. The property is on the market for $39.5 million, according to a company news release. Jason Maier, a Stan Johnson director, and associate Jeff Karp are heading up marketing efforts. The retail condo has 3,000 square feet on the

Commercial properties recently placed on the market

ground floor, 2,000 square feet on the mezzanine level and 2,500 square feet in the basement, Maier told The Real Deal last month. As previously reported, the space was formerly occupied by the Chinese food restaurant Ollie’s. In addition, Union Square Hospitality Group CEO Danny Meyer was reportedly eying the condo, which is adjacent to an Apple store.

Lower East Side portfolio asking $27 million A package of three properties on the Lower East Side is on the market with an asking price of $27 million. The portfolio, located between Grand and Broome streets, is comprised of a pair of five-story, loft-style commercial buildings at 59-63 and 65-67 Orchard Street and a two-story commercial building at 57 Orchard 57, 59-63 and 65-67 Orchard St. Street. The combined footprint of the three adjacent lots, which have 320 feet of frontage on three streets, is approximately 12,083 square feet. The buildings are fully occupied, but the tenants are either on short-term leases or are carrying leases with sixmonth cancellation clauses. Michael DeCheser of Massey Knakal Realty Services is handling the assignment.

East Village apartment building on the market A six-story multi-family property at 202 First Avenue is for sale with an asking price of $13 million. The 16,000-square-foot building, located between East 12th

and 13th streets, contains 20 units, including eight one-bedrooms, 10 two-bedrooms and two three-bedrooms. Three of the apartments are duplexes with roof terraces, and six of the units were recently gut renovated. The property’s lone retail space is occupied by apparel store No Relation Vintage Clothing, and the building also has five storage 202 First Ave. units. Marcia Rose Yawitz and Paul Nigido of Eastern Consolidated are marketing the property.

Prospect Heights multi-family property for sale A 9,000-square-foot apartment building at 267 Flatbush Avenue in the Prospect Heights section of Brooklyn is on the market with an asking price of $6.6 million. Located at the corner of Flatbush and St. Marks avenues, the property has nine residential units and a retail unit that will be occupied by a new restaurant this summer. Five of the residential units are vacant and in the process of being renovated, while two have already been renovated and leased. The building is located a few blocks from the recently opened Barclays Center. Ofer Cohen, Adam Hess, Melissa DiBella, Dan Marks, Peter Matheos and Michael Hernandez of TerraCRG are handling the sale. Compiled by Linden Lim

For more information please visit: Manhattan Showroom 230 5th Ave New York, NY 10001 (212) 213-9350 www.nyslidingdoor.com Office Partitions

Swing Doors

Closet Doors

Room Dividers

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Office listings

Retail listings

Property information Registration not required

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Have questions or want to submit listings? Send them to listings@agorafy.com.

Deal Sheet summary

The Deal Sheet, on pages 74 to 88, covers transactions from 1/11/13 through 2/10/13. Please submit future deals to deals@therealdeal.com.

Sales

Overview

By type

Property sales

Development

Deals Dollars

Hotel

115.00

Industrial

260.59

Mixed-use

541.98

Multi-family

720.01

Office

634.44

Retail

190.69

Financing Aggregate value

148.42

Industrial

$2,611,130,000

Buildings

Development

Hotel

115

Transactions

By dollar volume (in millions)

$97,000,000

Leases Office

Retail

Total

137

Leases square feet Office

1,411,557

Retail

187,241

Total

1,598,798

Office leases Office leases by industry Industry

Office leases sf by industry Leases

Industry

Top tenant reps for office leasing by sf

Square feet leased

Tenant representative

Square feet leased

Advertising & Marketing

75,418

CBRE Group

273,572

Architecture & Design

10,204

Jones Lang LaSalle

203,138

Education

Fashion*

119,696

Cassidy Turley

Financial

612,667

Avison Young

Government

Health & Beauty

Legal

Media

Medical

NGO

Other / n/a

Public Relations

Other / n/a

Public Relations

Publishing

Real Estate

Science & Technology

8,569

Cushman & Wakefield

37,085 32,577 30,000

VIZA Group

21,736

First New York Realty Brokers LLC

20,987

60,679

Rice & Associates

20,008

40,000

Walter & Samuels

14,436

5,998

Capstone Realty Advisors

12,550

7,238

Benchmark Properties

11,935

70,896 2,950

Newmark Grubb Knight Frank

7,401

Mohr Partners

5,403

185,000

Vortex Group

4,770

44,814

Maxwelle NY

4,175

11,078

Atco

4,071

153,050 3,300

Retail leases Top tenant reps for leasing by sf

Retail leases by industry

Broker

Discount

49,731

Fashion

18,350

Square feet leased

SRS Real Estate Partners

40,615

Fashion

Crown Retail Services

Retail leases sf by industry

21,000

Food & Beverage

29,551

Ripco Real Estate

14,671

Health & Beauty

32,317

Rice & Associates

12,104

Medical

18,528

Welco Realty

9,000

Kalmon Dolgin Affiliates

4,700

Other / n/a

38,764

Lee & Associates

4,700

Metro Brokers

4,100

PD Properties LLC

4,000

Cushman & Wakefield

3,900

Esquire Properties

3,700

Shopping Center Group

3,500

Douglas Elliman

3,450

(*includes showroom space)

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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 1/11/13 to 2/10/13. Please submit future deals to deals@therealdeal.com.

Office leases Address

Size

Tenant / Representative

Landlord / Representative

Notes

520 Madison Ave

450,000

Jefferies / n/a

Tishman Speyer / Dale Schlather, C&W

The investment bank signed a 15-year lease renewal for floors two through 13 and 16 through 20, Crain’s reported. The tenant will pay an average rent of $90 per square foot for its space on the lower floors of the building. The company will pay an average of $103 per square foot for the upper floors until its current lease expires in 2022, after which the new terms of the tenant’s lease extension will take effect.

195 Broadway

185,000

HarperCollins / K. Rapp, M. Ann Tighe, C. Mansfield, L. Corrinet, CBRE

Beacon Capital Partners; L&L Holding Co. / Represented in-house

The book publisher signed a 15-year lease to relocate from its longtime home at 10 East 53rd Street. The company is moving back downtown, where it had long been based prior to moving to its Midtown offices.

120 Broadway

79,688

American Arbitration Association / C. Kraus, B. Higgins, Jones Lang LaSalle

Larry Silverstein / Represented inhouse

The arbitration enterprise leased space in the building in three separate transactions: two direct leases with the landlord and a sublease from Banco Popular.

100 West 33rd St

61,916

HP Girlswear/BB Active / Arnold Gamberg, Murray Hill Properties

n/a / C. Panzirer, J. Solomon, Vornado

The fashion company signed a lease.

100 Park Ave

43,294

WPP Group / n/a

SL Green / n/a

The communications services company signed a lease renewal on the entire fourth floor.

32 Old Slip

40,000

U.S. Census Bureau / Represented in-house

Beacon Capital / Bruce Surry, CBRE

The Census Bureau signed a lease for the entire ninth floor and part of the eighth floor, Crain’s reported.

605 Third Ave

40,000

Univision Communications / Carl Eriksen, CBRE

Fisher Brothers / n/a

The Spanish-language media company signed an expansion lease on the 25th and 26th floors, the New York Post reported.

14 Wall St

37,000

New York State Society of CPAs / Ellen Herman, Jones Lang LaSalle

Alex Rovt / Brad Gerla, CBRE

The accounting organization signed a 10-year lease for an entire floor, Crain’s reported. The tenant is relocating from 3 Park Avenue.

110 William St

30,896

The City of New York / Jonathan Dean, Swig Equities

Swig Equities / n/a

The City of New York signed a lease renewal.

99 Park Ave

30,000

Heidell, Pittoni, Murphy & Bach LLP / Michael Leff, Avison Young

Eastgate Realty / P. Glickman, D. Biasotti, Jones Lang LaSalle

The law firm signed a 10-year lease renewal on the seventh floor, the New York Observer reported.

1185 Sixth Ave

27,342

Alterra USA Holdings / Scott Cahaly, Jones Lang LaSalle

SL Green / Represented in-house

The insurance firm signed a lease to consolidate its New York offices, the New York Observer reported.

1601 Broadway

26,000

Micro Office Solutions / Joseph Friedman, Murray Hill Properties

n/a / T. Kucha, S. Riker, N. Woodhull, Cassidy Turley

The workspace provider signed a sublease on the 12th floor.

229 West 43rd St

26,000

Felix/CityGrid Media / S. Rotter, S. Panzer, R. Masiello, Jones Lang LaSalle

Equity Office Properties / B. Waterman, L. Korman, J. Tootell, B. Ozarowski, Newmark Grubb Knight Frank

The local advertising service provider signed a five-year lease.

150 East 42nd St

25,000

American Arbitration Assocation / C. Kraus, B. Higgins, Jones Lang LaSalle

Hiro / S. Gottlieb, R. Laginestra, B. Dooley, CBRE

The arbitration enterprise signed a lease.

521 Fifth Ave

21,677

Major Lindsey & Africa / Jamie Smith, Cassidy Turley

SL Green / T. Stacom, B. Zeller, P. Alden, W. Morris, M. Nahmias, C&W

The legal recruiter signed a 10-year lease for the entire fifth floor.

521 Fifth Ave

20,987

Chinatrust Commercial Bank / Soon Rhee, First New York Realty Brokers LLC

SL Green / T. Stacom, B. Zeller, P. Alden, W. Morris, M. Nahmias, C&W

The bank signed a 15-year lease for the entire 11th floor.

712 Fifth Ave

20,000

CVC Capital Partners / B. Friedland, S. Petriello, CBRE

Paramount Group / Represented inhouse

The investment firm signed a 10-year expansion lease, Crain’s reported.

1412 Broadway

17,748

FYC Apparel / Jesse Rubens, Murray Hill Properties

Harbor Group International / n/a

The apparel company signed a 10-year lease renewal for a full floor.

1251 Sixth Ave

14,600

Bank of Tokyo – Mitsubishi Ltd. / Fred Smith, C&W

n/a / D. Falk, P. Shimkin, N. Berger, Newmark Grubb Knight Frank

The bank signed an expansion lease for part of the seventh floor. The tenant now occupies 263,700 square feet in the building.

1412 Broadway

14,436

Grind / Greg Postyn, Walter & Samuels

Harbor Group International / n/a

The collaborative workspace provider signed a long-term lease.

16 West 22nd St

13,000

Rebecca Minkoff / A. Wildes, E. Silverstein, C&W

Meysar Realty Corp. / Barbara Yagoda, Newmark Grubb Knight Frank

The fashion company signed a long-term lease to relocate to and consolidate its New York City offices on the seventh floor.

1441 Broadway

11,935

Christina America Inc. / Michael Beyda, Benchmark Properties

LH Charney & Associates / Rick Doolittle, Murray Hill Properties

The swimwear company signed a lease.

540 Madison Ave

10,900

The Bank of East Asia Ltd. / R. Billingsley, J. Schindler, B. Boisi, Cassidy Turley

Boston Properties / C. Wasserberger, D. Kleiner, R. Abend, Jones Lang LaSalle; A. Levin, A. Frazier, D. Birney, Boston Properties

The bank signed a new 15-year lease for the entire 10th floor. The tenant is relocating from 202 Canal Street.

757 Third Ave

10,680

Mizuho Alternative Investments LLC / A. Dattoma, R. Flippin, CBRE

n/a / A. Chudnoff, M. Konsker, M. Ginberg, Jones Lang LaSalle

The asset management company signed a 10-year, nine-month lease for part of the eighth floor.

110 William St

8,569

Knowledge Delivery Systems Inc. / Jonathan Dean, Swig Equities

Swig Equities / n/a

The online provider of certification programs for educators signed a new lease.

980 Madison Ave

8,108

The Dontzin Law Firm LLP / Alexander Chudnoff, Jones Lang LaSalle

n/a / Oliver Katcher, RFR Realty LLC

The law firm signed an 11-year lease for part of the second floor.

159 West 25th St

7,500

Venmo Inc. / Gregory Rogers, Rice & Associates

Comixology Inc. / M. Okun, M. Piccirillo, Coldwell Banker Commercial

The tenant signed a lease.

115 West 29th St

7,000

Women Make Movies / Thomas Jacobs, Rice & Associates

Jung Family Partnership / Thomas Jacobs, Rice & Associates

The tenant signed a lease.

44 West 18th St

6,142

Taboola Inc. / Jared Freede, CBRE

Forty Four Eighteen Associates / James Buslik, Adams & Co.

The content distribution and monetization platform signed a new five-year lease. The reported asking rent was $44 per square foot.

1412 Broadway

5,403

Quartet Financial Services / Lewis Cowen, Mohr Partners

Harbor Group International / n/a

The financial software developer signed a long-term lease on the 23rd floor.

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Office leases continued Address

Size

Tenant / Representative

Landlord / Representative

Notes

589 Eighth Ave

5,200

Archilier Architecture / R. Murtha, D. Oâ&#x20AC;&#x2122;Donnell, Capstone Realty Advisors

n/a / Neil Joffee, Newmark Grubb Knight Frank

The architecture firm signed a lease for the entire 11th floor.

48 Wall St

4,950

Fletcher Asset Management / Doug Dolgoff, C&W

Swig Equities / n/a

The financial investment advisory firm signed a new lease.

48 Wall St

4,770

Eye Mall Media / R. Marek, O. Petrovic, Vortex Group

Swig Equities / n/a

The advertising firm signed a new lease.

540 Madison Ave

4,247

Conquest Capital Group / Bill Harvey, Newmark Grubb Knight Frank

Boston Properties / C. Wasserberger, D. Kleiner, R. Abend, Jones Lang LaSalle; A. Levin, A. Frazier, D. Birney, Boston Properties

The financial services firm signed a new seven-year lease for part of the 14th floor.

540 Madison Ave

4,200

Hakluyt Co. / G. Miovski, S. King, CBRE

Boston Properties / C. Wasserberger, D. Kleiner, R. Abend, Jones Lang LaSalle; A. Levin, A. Frazier, D. Birney, Boston Properties

The British strategic intelligence and advisory firm signed a new seven-year lease for part of the 15th floor. The tenant is relocating from 230 Park Avenue.

1359 Broadway

4,071

Cambridge Mercantile Group / Peter Goldich, Atco

W&H Properties / R. Silver, A. Sciacca, N. Rubin, Newmark Grubb Knight Frank

The financial firm signed a lease.

540 Madison Ave

3,950

GxG Management LLC / J. Maher, S. Winter, CBRE

Boston Properties / A. Frazier, D. Birney, Boston Properties

The tenant signed a five-year lease renewal for part of the 21st floor.

540 Madison Ave

3,600

CIMB Securities / S. Li, D. Wilpon, CBRE

Boston Properties / A. Frazier, D. Birney, Boston Properties

The investment holding company signed a five-year lease renewal on the 11th floor.

133 Chrystie St

3,500

MindGames Software / Michael Jaffee, Capstone Realty Advisors

n/a / Royce Liu, Redwood Property Group

The software company signed a lease for the entire third floor.

463 Seventh Ave

3,398

Sugar Plum NY Inc. / Jack Cohen, Colliers International

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

The dress maker signed a new seven-year lease. The reported asking rent was $38 per square foot.

135 Fifth Ave

3,300

Jennifer Connelly Public Relations / Elissa Groh, Rice & Associates

441 Lexington Ave. Co. LP / Valerie Coster, 441 Lexington Ave. Co. LP

The public relations firm signed a lease.

110 William St

3,154

BRAC USA / W. Cohen, J. Travis, Newmark Grubb Knight Frank

Swig Equities / n/a

The nonprofit signed a new lease.

850 Seventh Ave

2,935

The Johnson Street Foundation / Uriel Gandelman, VIZA Group

n/a / David A. Kahame, DAK Commercial Realty

The nonprofit inked a five-year lease. The reported asking rent was $43 per square foot.

231 West 39th St

2,821

Point Zero / Maxwelle NY

231/249 West 39 Street Associates / James Buslik, Jeff Buslik, Adams & Co.

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

540 Madison Ave

2,750

Ajax Advisors LLC / T. Gibson, M. Glasberg, C&W

Boston Properties / C. Wasserberger, D. Kleiner, R. Abend, Jones Lang LaSalle; A. Levin, A. Frazier, D. Birney, Boston Properties

The real estate advisory and structured finance company signed a short-term lease for part of the 18th floor.

231 West 39th St

2,339

Studio A / James Buslik, Jeffrey Buslik, Adams & Co.

231/249 West 39 Street Associates / James Buslik, Jeffrey Buslik, Adams & Co.

The tenant signed a five-year lease renewal and expansion. The reported asking rent was $35 per square foot.

11 East 47th St

2,250

Manhattan Wellness Center / Uriel Gandelman, VIZA Group

n/a / Barbara Epstein, Lester A. Epstein & Associates LLC

The wellness center inked a 10-year lease.

276 Fifth Ave

2,208

Goren Group / Matthew Kurzban, Rice & Associates

3 West 35th Company / Elliot Klein, Winoker Realty

The tenant signed a lease.

424 West 33rd St

2,175

Synowledge LLC / Brian Wilson, Capstone Realty Advisors

n/a / E. Cutler, Newmark Grubb Knight Frank

The life sciences and IT solutions provider signed a lease for part of the sixth floor.

277 Fifth Ave

2,150

someecards / Beth Chase, Cast Iron Real Estate

Mirsal LLC / Elissa Groh, Rice & Associates

The tenant signed a lease.

277 Fifth Ave

2,150

ITeam Technology Associates / Rebecca Spalding & Nigel Shamash NSNRE

Mirsal LLC / Tom Jacobs, Rice & Associates

The tenant signed a lease.

285 West Broadway

2,000

Jim Feldman Creative Direction / n/a

285 West Broadway Associates / Joshua Salon, Salon Realty Corp.

The creative firm signed a three-year lease.

1407 Broadway

1,915

Young Threads NYC / Y. Chang, J. Kosaric, Kaufman Organization

n/a / Y. Chang, J. Kosaric, Kaufman Organization

The fashion company signed a lease. The reported asking rent was $45 per square foot.

110 William St

1,785

EFG Asset Management / Jonathan Fein, C&W

Swig Equities / n/a

The financial research company signed a new lease.

555 Eighth Ave

1,675

Mega Shipping / Brian Wilson, Capstone Realty Advisors

n/a / Tom Bisaki, Sloyer-Forman Inc.

The cargo services provider signed a lease for part of the 10th floor.

64 Fulton St

1,628

NY Casa Group / Marie Hammoudi, VIZA Group

Recovery Country Club / William Hocking, William S. Hocking Realty

The residential real estate company inked a long-term lease.

1407 Broadway

1,548

Silhouette NYC LLC / Y. Chang, J. Kosaric, Kaufman Organization

n/a / Y. Chang, J. Kosaric, Kaufman Organization

The apparel company signed a lease. The reported asking rent was $42 per square foot.

233 Broadway

1,501

Frank, Rimerman & Co. LLP / Maz Vizgalin, VIZA Group

233 Broadway Owners / Thomas Hettler, Lawrence Group

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

1407 Broadway

1,468

Green Point Technology Services / Y. Chang, J. Kosaric, Kaufman Organization

n/a / Y. Chang, J. Kosaric, Kaufman Organization

The global contract-sourcing firm signed a lease.

1407 Broadway

1,451

Kenwell USA LLC / Y. Chang, J. Kosaric, Kaufman Organization

n/a / Y. Chang, J. Kosaric, Kaufman Organization

The textile firm signed a lease. The reported asking rent was $42 per square foot.

241 West 37th St

1,400

Vinci Enterprise Corp. / Alex Saharov, VIZA Group

n/a / Mordechai Koppel, 241/37 Realty Group

The fashion showroom inked a three-year lease.

231 West 39th St

1,354

The Ntwrk Agency / Maxwelle NY

231/249 West 39 Street Associates / James Buslik, Jeff Buslik, Adams & Co.

The brand development agency signed a five-year lease. The reported asking rent was $35 per square foot.

315 Madison Ave

1,237

Dr. Heather Lewerenz / Maz Vizgalin, VIZA Group

Abramson Brothers / Billie Jean Hamel, Abramson Brothers

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

1407 Broadway

1,154

Daniel Design Inc. / Y. Chang, J. Kosaric, Kaufman Organization

n/a / Y. Chang, J. Kosaric, Kaufman Organization

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

261 West 35th St

1,150

Managed Care Physical Therapy / Marie Hammoudi, VIZA Group

n/a / Audrey Hallett, H. Justin Realty Services

The physical therapist inked a lease.

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Office leases continued Address

Size

Tenant / Representative

Landlord / Representative

Notes

119 West 40th St

1,149

Harriet and Esteban Vicente Foundation Inc. / David Levy, Adams & Co.

One Ten West Fortieth Associates / David Levy, Adams & Co.

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

1407 Broadway

1,119

Screenworks USA Inc. / Y. Chang, J. Kosaric, Kaufman Organization

n/a / Y. Chang, J. Kosaric, Kaufman Organization

The apparel company signed a lease. The reported asking rent was $42 per square foot.

231 West 39th St

1,086

Kabir SM Holdings Inc. / James Buslik, Jeffrey Buslik, Adams & Co.

231/249 West 39 Street Associates / James Buslik, Jeffrey Buslik, Adams & Co.

The tenant signed a two-year lease renewal. The reported asking rent was $35 per square foot.

231 West 39th St

1,039

Kendra Scott Design Inc. / James Buslik, Jeffrey Buslik, Adams & Co.

231/249 West 39 Street Associates / James Buslik, Jeffrey Buslik, Adams & Co.

The design company signed a two-year lease renewal. The reported asking rent was $35 per square foot.

231 West 39th St

1,005

Sienna Rose Inc. / James Buslik, Jeffrey Buslik, Adams & Co.

231/249 West 39 Street Associates / James Buslik, Jeffrey Buslik, Adams & Co.

The tenant signed a two-year lease renewal. The reported asking rent was $35 per square foot.

274 Madison Ave

1,004

Seven Eight Capital / Marie Hammoudi, VIZA Group

Abramson Brothers / Billie Jean Hamel, Abramson Brothers

The financial services firm signed a lease. The reported asking rent was $47 per square foot.

336 West 37th St

1,000

Alexandra Sacchi / Marie Hammoudi, VIZA Group

IGS Realty Co. / Philippe Ifrah, IGS Realty Co.

The designer inked a three-year lease. The reported asking rent was $43 per square foot.

160 Broadway

980

VXL Medical Care / Max Vizgalin, VIZA Group

Daror Associates / Mendy Braun, Braun Management

The pulmonologist signed a six-year lease.

13 East 37th St

950

The Sperm and Embryo Bank of New Jersey / Marie Hammoudi, VIZA Group

AZN Realty / Jacob Nahamias, AZN Realty

The reproductive cell and tissue bank signed a five-year lease.

39 West 32nd St

900

Tomorrow Lab / Marie Hammoudi, VIZA Group

n/a / Gautam Nagarmat, Berik Management

The design consultancy for hardware products signed a lease.

231 West 39th St

900

Sportiqe LLC / James Buslik, Jeff Buslik, Adams & Co.

231/249 West 39 Street Associates / James Buslik, Jeff Buslik, Adams & Co.

The apparel company signed a three-year lease. The reported asking rent was $35 per square foot.

501 Fifth Ave

894

Edelstein & Grossman LP / Alex Saharov, VIZA Group

Abramson Brothers / Billie Jean Hamel, Abramson Brothers

The law firm inked a five-year lease.

231 West 39th St

890

Elan International Inc. / James Buslik, Jeffrey Buslik, Adams & Co.

231/249 West 39 Street Associates / James Buslik, Jeffrey Buslik, Adams & Co.

The tenant signed a three-year lease renewal. The reported asking rent was $35 per square foot.

231 West 39th St

864

Cass New York Inc. / James Buslik, Jeffrey Buslik, Adams & Co.

231/249 West 39 Street Associates / James Buslik, Jeffrey Buslik, Adams & Co.

The tenant inked a three-year lease renewal. The reported asking rent was $35 per square foot.

231 West 39th St

842

Chapter One Sportswear / James Buslik, Jeffrey Buslik, Adams & Co.

231/249 West 39 Street Associates / James Buslik, Jeffrey Buslik, Adams & Co.

The sportswear company signed a two-year lease renewal. The reported asking rent was $35 per square foot.

110 West 40th St

823

Integrate NY / David Levy, Adams & Co.

One Ten West Fortieth Associates / David Levy, Adams & Co.

The information technology consulting firm signed a four-year lease. The reported asking rent was $42 per square foot.

110 William St

753

Jimmy Sung MD PLLC / Max Vizgalin, VIZA Group

n/a / Jonathan J. Dean, Swig Equities

The plastic surgeon signed a five-year lease.

225 Broadway

715

Lang Architecture / Max Vizgalin, VIZA Group

n/a / Mendy Braun, Braun Management

The architects signed a five-year lease.

120 East 57th St

700

Midtown Wellness Center / Max Vizgalin, VIZA Group

n/a / Brett Weinblatt, Solil Management

The wellness center inked a 10-year office lease.

274 Madison Ave

575

Dr. Dominick Fazzari / Max Vizgalin, VIZA Group

Abramson Brothers / Billie Jean Hamel, Abramson Brothers

The chiropractor inked a lease.

1133 Broadway

461

Civilian Miltary Combine / Alex Saharov, VIZA Group

Kew Management / Represented inhouse

The event planners signed a lease.

515 Madison Ave

353

Linda McEvatt LCSW / Max Vizgalin, VIZA Group

n/a / Martin McGrath, Newmark Grubb Knight Frank

The psychologist inked a five-year lease.

252 West 38th St

350

Feng Qing Chen / Marie Hammoudi, VIZA Group

n/a / Carlos Silberman, Falcon Properties

The designer inked a lease.

Retail leases Address

Size

Tenant / Representative

Landlord / Representative

Notes

3791 Broadway

21,000

Planet Fitness / R. Chera, I. Mograby, Crown Retail Services

Friedland Properties / Aaron Prince, Friedland Properties

The fitness chain signed a 15-year lease for space on the ground and second floors.

166-10 Archer Ave (Queens)

17,000

Dollar Tree / Erin Grace, SRS Real Estate Partners

Benenson Capital Corp. / n/a

The discount retailer signed a lease for another location.

131-09 101st Ave (Queens)

11,000

Dollar Tree / Eric Grace, SRS Real Estate Partners

Platinum Realty Associates / n/a

The discount retailer signed a lease for another location.

675 Sixth Ave

10,000

Harmon / n/a

n/a / P. Ripka, A. Mandell, R. Skulnik, Ripco Real Estate

The drugstore signed a lease, the New York Post reported.

214 Jamaica Ave (Queens)

9,015

Dollar Tree / Eric Grace, SRS Real Estate Partners

RW 214-50 Jamaica Ave LLC / n/a

The discount retailer signed a lease for another location.

2129 White Plains Rd (The Bronx)

9,000

Dress Barn / M. Weiss, E. Saff, Welco Realty

Sopher Real Estate / n/a

The womenâ&#x20AC;&#x2122;s apparel retailer signed a new 10-year lease.

1955 First Ave

8,616

Deal$ by Dollar Tree / M. Mahony, E. Bukai, R. Senior, Ripco Real Estate

LMN Equities / Represented in-house

The discount store signed a 10-year lease.

150 Fourth Ave (Brooklyn)

6,300

Body Unique LLC / n/a

Invesco / R. Condren, K. Triglia, G. Danut, CPEX Real Estate

The fitness studio signed a lease.

240 Atlantic Ave (Brooklyn)

6,055

PM Pediatrics / J. Pennington, B. Cohen, Ripco Real Estate

n/a / T. King, R. Condren, K. Triglia, G. Danut, CPEX Real Estate

The pediatric office signed a 10-year retail lease.

40 West 17th St

6,000

Arch Gate / Elissa Groh, Rice & Associates

COOP / Adam Miller, Corcoran

The tenant signed a retail lease.

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Retail leases continued Address

Size

Tenant / Representative

Landlord / Representative

Notes

2111 White Plains Rd (The Bronx)

5,000

Accent Care of New York / n/a

Sopher Real Estate / n/a

The home healthcare agency leased retail space.

330 West 42nd St

4,200

MedRite / n/a

Deco Towers Associates / J. Pruger, K. Ota, A. Cukier, Newmark Grubb Knight Frank

The urgent care facility signed a retail lease for its second Manhattan location.

2127 Westchester Ave (The Bronx)

4,100

Dollar K / John Walmarth, Metro Brokers

Sopher Real Estate / n/a

The discount retailer signed a 10-year lease.

567 Seventh Ave

4,000

Paris Baguette / Tony Park, PD Properties LLC

n/a / R. Horvath, B. Fox, Massey Knakal

The bakery signed a lease for another location.

300 Madison Ave

3,900

Zero Halliburton Luggage / J. Podell, B. Singer, I. Lerner, C. Stanton, J. Cushman, C&W

CIBC; Brookfield Properties / Represented in-house

The suitcase maker signed a lease for a new store, the New York Post reported.

555 West 235th St

3,700

Kidville / Craig Hantgan, Esquire Properties

Friedland Properties / Aaron Prince, Friedland Properties

The children’s educational and recreational center signed a 15-year lease.

50 Greene St

3,600

Gudrun Sjoden / Marianne Thorsen (independent broker)

n/a / Yair Staav, Lansco; D. Zar, Zar Property NY

The Swedish home accessories retailer signed a lease, the New York Post reported.

21A Clinton St

3,500

Stephen Tyler Productions / Gregory Rogers, Rice & Associates

Assnco Realty / S. Meranus, R. Perl, Tower Brokerage

The tenant signed a retail lease.

55 Broad St

3,500

Starbucks / David Firestein, Shopping Center Group

Rudin Management / Represented in-house

The coffee chain signed an expansion lease, the New York Post reported. The asking rent was $140 per square foot, according to the paper.

18 Commerce St (Brooklyn)

3,500

Con Amore / Louie Hamdan, Kalmon Dolgin Affiliates

Salvatore Reale / Louie Hamdan, Kalmon Dolgin Affiliates

The bar and lounge signed a lease.

747 Madison Ave

3,300

Alexander McQueen / Susan Kurland, CBRE

Jeff Sutton; SL Green / Represented in-house

The designer signed a retail lease, the New York Post reported.

400 Bedford Ave (Brooklyn)

3,100

Williamsburg School of Music / Gary Steinberg, Lee & Associates

400 Bedford LLC / Gary Steinberg, Lee & Associates

The music school signed a 10-year lease with a one-year option. The reported asking rent was $60 per square foot.

102 Greenwich St

3,000

Twin Tower Tees / Mark Kapnick, SRS Real Estate Partners

102 Greenwich Realty LLC / Steve Rappaport Sinvin Realty

The apparel retailer signed a 12-year lease for its second Financial District location. The reported asking rent was $200 per square foot.

540 West 28th St

2,604

Joshua Liner Gallery / Earl Bateman, Rice & Associates

W. 27th Street Rental LLC / R. Evans, Walker Malloy; A. Pickens, Pickens Real Estate

The gallery signed a lease.

45 West 55th St

2,500

Natureworks / NAI Global

Double E Realty / P. Braus, J. Sutro, Lee & Associates

The health food restaurant signed a lease for its second location. The reported asking rent was $145 per square foot.

110 West 40th St

2,441

Kobeyaki 2 LLC / Midtown Commercial Real Estate

One Ten West Fortieth Associates / David Levy, Adams & Co.

The restaurant signed a 15-year lease. The reported asking rent was $200 per square foot.

64 Frost St (Brooklyn)

2,000

Beach Block Hospitality / CCM Management

Paul’s LLC / M Properties

The hospitality group signed a lease for a bar and restaurant.

118 East 57th St

2,000

Oro Gold Cosmetics / F. Consolo, J. Aquino, Douglas Elliman

n/a / A. Cohen, M. Tergesen, D. Valentino, ABS Partners

The cosmetics retailer signed a lease for its flagship store.

200 East 28th St

1,800

Starbucks / n/a

28th Co. LLC / Bill Abramson, Buchbinder & Warren

The coffee chain signed a lease.

560 11th Ave

1,610

Grand Cru Wines and Spirits / Hariklia Koundourakis, Coldwell Banker

Massachusetts Life Insurance Company / J. Gettler, M. Gorman, J. Kaufman, New Street Realty

The wine shop signed a lease.

212 Front St

1,600

Vbar3 LLC / Julia Volpe, Global Property Source LLC

212 Front Street LLC / Dean Soukeras, Madison Avenue Group LLC

The restaurant signed a 10-year lease.

211 Knickerbocker Ave (Brooklyn)

1,500

n/a / n/a

n/a / Andrew Clemens, Massey Knakal

A bar signed a lease.

822 Lexington Ave

1,500

Starbucks / n/a

Third City LLC / David Koeppel, Koeppel Capital LLC

The coffee chain signed a lease for another location.

1242 Madison Ave

1,450

Le Civette / F. Consolo, J. Aquino, Douglas Elliman

n/a / n/a

The Italian boutique signed a 10-year lease for its first U.S. store, the New York Post reported.

1703 Third Ave

1,300

Carnegie Hill Veterinarians / David Pressberg, SCG Retail

Millstein Properties / Represented in-house

The veterinary office leased storefront space.

936 Amsterdam Ave

1,300

n/a / n/a

n/a / David Chkheidze, Massey Knakal

A restaurant signed a lease.

1052 Lexington Ave

1,200

CHUCKiES / A. Schuster, J. Totolo, RKF

The Winter Organization / A. Schuster, J. Totolo, RKF

The shoe retailer signed a lease for a new store.

196 Union Ave (Brooklyn)

1,200

Subway / Louie Hamdan, Kalmon Dolgin Affiliates

Lindsay Park Holdings Group / Louie Hamdan, Kalmon Dolgin Affiliates

The sandwich chain signed a long-term lease for another location.

133 East 39th St

1,173

n/a / n/a

n/a / Ryan Horvath, Massey Knakal

A veterinarian’s office leased retail space.

500 Prospect Pl (Brooklyn)

1,160

It Takes a Village / n/a

n/a / Gregory Bartlett, Massey Knakal

The nonprofit took retail space.

137 First Ave

1,100

David Yoo / H. Demetrious, I. Donath, NYCRS

Aro Management / n/a

The homemade ice cream shop signed a 10-year lease.

127 East 60th St

1,000

Nail Bart Spa Corp. / P. Braus, J. Sutro, Lee & Associates

Sierra Realty / P. Braus, J. Sutro, Lee & Associates

The nail salon signed a lease for its second location. The reported asking rent was $90 per square foot.

57 West 57th St

967

Gorgeous Bride Inc. / Max Vizgalin, VIZA Group

n/a / Christel Engel, Colliers International

The hair studio inked a 10-year lease.

601 West 150th St

800

n/a / n/a

n/a / David Chkheidze, Massey Knakal

A medical office leased ground-floor storefront space.

1406 St. John’s Pl (Brooklyn)

650

n/a / n/a

n/a / Andrew Clemens, Massey Knakal

A hair salon signed a lease.

971 First Ave

600

Ben’s Jewelry / P. Braus, J. Sutro, Lee & Associates

Jobarac Realty / P. Braus, J. Sutro, Lee & Associates

The jewelry store signed a lease for its second location. The reported asking rent was $120 per square foot.

180 West Broadway

600

Gloria Jewel / Mark Kapnick, SRS Real Estate Partners

Queenwood 34, LLC / Mark Kapnick, SRS Real Estate Partners

The jeweler signed a 10-year lease. The reported asking rent was $200 per square foot.

1435 Lexington Ave

400

Lucky Wang / Howard Aaron, Square Foot Realty

1435 Tenants Corp. / Howard Aaron, Square Foot Realty

The children’s clothing store signed a lease for its third Manhattan location. The reported asking rent was $135 per square foot.

1212 Lexington Ave

400

AA Hair Salon / J. Famularo, R. Idnani, NYCRS

n/a / S. Klatsky, N. Galloway, Time Equities

The hair salon signed a 10-year lease.

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Buys Address

Size

Buyer / Representative

Seller / Representative

Notes

450 West 15th St

281,361 sf mixeduse bldg

Jamestown Properties / n/a

Stellar Management / D. Harmon, A. Spies, Eastdil Secured

The property sold for $295 million. The deal involved a piece of seller financing, with Stellar providing a $150 million short-term loan to Jamestown, which appears in public records. The move was intended to help the deal close quickly, while giving Jamestown more time to iron out long-term financing, The Real Deal has learned.

New York portfolio

14 self-storage facilities

Storage Post / n/a

Acadia Realty Trust / n/a

A portfolio of self-storage buildings in Queens, Brooklyn and the Bronx sold for $249 million. The properties are located at 30-28 Starr Avenue and 48-05 Metropolitan Avenue in Queens; 3329 Atlantic Avenue in Brooklyn; and 4077 Park Avenue, 112 Bruckner Boulevard and 301-305 West Fordham Road in the Bronx.

555 West 53rd St

162 apt. units

Invesco / n/a

Two Trees Management / n/a

The 162 apartments at the new development Mercedes House sold for $170 million, the Wall Street Journal reported. The property has 874 units in total.

114 Fifth Ave

18-story, 341,000 sf office bldg

L&L Holding Co.; Lubert-Adler / J. Carson, Y. Cho, K. Fallon, L&L Holding Co.

n/a / n/a

A 99-year leasehold in the building sold for $165 million, the New York Post reported. The buyers plan to upgrade and reposition the property, according to the paper.

East Village portfolio

17 apt. bldgs, 271 units

Jared Kushner / Aaron Jungreis, Rosewood Realty

Westbrook Partners / Aaron Jungreis, Rosewood Realty

The package of walk-up building sold for $130 million. The properties are located at 201 East 2nd Street, 23 Avenue A, 129 First Avenue, 143 First Avenue, 338-340 East 11th Street, 165-167 Avenue A, 500 East 11th Street, 504 East 12th Street, 191-193 Avenue A, 435 East 12th Street, 516 East 13th Street, 211 Avenue A and 49 and 1/2 First Avenue.

551 Madison Ave

17-story, 150,000 sf office bldg

Cornerstone Properties / n/a

LaSalle Investment Management / D. Stacom, B. Shanahan, P. Gillen, CBRE

The property sold for $128 million. The property is 91 percent occupied.

131-137 Spring St

68,342 sf mixed-use bldg

SL Green / n/a

n/a / n/a

The property sold for $122.3 million.

205 East 45th St

203-room hotel

Wyndham Hotel Group / n/a

Rockpoint Group; Atlas Capital Group; Procaccianti Group / Mark Schoenholtz, Eastdil Secured

The Alex Hotel sold for $115 million.

875 Washington St

5-story, 60,000 sf office bldg

Thor Equities; ASB Real Estate / n/a

Scoop NYC / D. Harmon, A. Spies, Eastdil Secured

The property sold for $96.44 million. The deal represents a $30 million markup over what California-based tycoon Ron Burkle, who has an ownership interest in Scoop NYC, paid for the five-story, 61,000-square-foot building at 428 West 14th Street one year previously. The deal was first reported by the New York Post.

NYC retail portfolio

5 bank branches

Madison Capital / n/a

FGP West Street / K. Zakin, R. Liberman, H. Dweck, Newmark Grubb Knight Frank

The package of five Citibank retail bank branches sold for $80.55 million. The properties are located at 123 East 86th Street and 2261 Madison Avenue in Manhattan, 181 Montague Street in Brooklyn, 107-01 71st Avenue in Queens and 1800 Williamsbridge Road in the Bronx.

112, 114 and 120 Fulton St

3 mixed-use bldgs and air rights

The Lightstone Group / n/a

Castega 114-116 Fulton Street LLC; 120 Fulton Realty; Suey Jin Lam; Time Equities / n/a

The three mixed-use buildings and adjacent air rights sold for $63 million. Lightstone has permission to demolish the three buildings, one source told The Real Deal recently, and may develop a mixed-use property. According to TRD’s calculations, the development could exceed 300,000 square feet.

311-319 West 43rd St

14-story office bldg

n/a / Brian Ezratty, Eastern Consolidated

Zubarry Associates / P. Hauspurg, B. Ezratty, S. Ellard, Eastern Consolidated

The property sold for $62.4 million.

158 West 27th St

116,000 sf office bldg

Emmes Asset Management / n/a

Stephen Meringoff; Leslie Himmel / A. Spies, D. Harmon, Eastdil Secured

The office building sold for $57.5 million, Crain’s reported.

350 Broadway

12-story office bldg

Bizzi & Partners / n/a

Hampstead LLC / n/a

The property sold for $53 million. The building was previously owned by Extell Development, which sold the 114,000 square-foot office space to Hampstead LLC for $39.5 million in 2006 — a profitable flip, since Extell had bought it for $30 million from the Feil Organization 18 months earlier.

380 Columbus Ave

7-story, 70,000 sf apt. bldg, 43 units total

Newcastle Realty Services / n/a

Joben Realty Associates / n/a

The property sold for $50 million. “It was a wonderful opportunity,” said Margaret Streicker Porres, Newcastle’s president and founder, on the decision to close on the seven-story building. The sale entered contract on Nov. 24. Streicker Porres declined to discuss whether the company will make changes to the building, including a possible condominium conversion, saying it was too soon.

East Village portfolio

7 apt. bldgs, 115 units total

Kushner Companies / n/a

Magnum Real Estate; Meadow Partners / n/a

A package of seven walk-ups sold for $49 million. The properties are located at 118, 120-122, 195, 199, 201 and 203 East 4th Street.

Manhattan portfolio

8 apt. bldgs, 322 units total

n/a / n/a

n/a / Aaron Jungreis, Rosewood Realty

The package sold for $39.9 million. The buildings are located at 14, 24 and 95 Thayer Street, 615 West 173rd Street, 115 East 116th Street, 518 West 204th Street, 87 Post Avenue and 4848 Broadway.

232 East 59th St

42,176 sf comm. bldg

Fine Arts Building LLC / Howard Morrel, Brown Harris Stevens

Battaglia Realty LLC / n/a

The property sold for $34 million.

320-328 West 36th St

Development site

n/a / n/a

n/a / B. Knakal, D. Kalish, Massey Knakal

The block-through development site sold for $33.5 million.

15-17 Bialystoker Pl

98,000 sf retirement home

n/a / J. Koicim, Marcus & Millichap; H. Kaplowitz, R. Freedman, Colliers International

The retirement home operated by the United Jewish Council of the East Side sold for $28 million. The site is zoned R8, for mid-rise to high-rise residential use, according to the Department of City Planning’s website.

Manhattan portfolio

3 apt. bldgs, 170 units total

n/a / n/a

n/a / Aaron Jungreis, Rosewood Realty

The properties sold for $27.9 million. The buildings are located at 30 Sickles Street, 370 Fort Washington Avenue and 121 Seaman Avenue.

532 Neptune Ave (Brooklyn)

49,000 sf retail bldg

Ruby Schron / n/a

Norse Realty Group / n/a

The property sold for $25 million.

105 Norfolk St

3-story retail bldg

Carter Management / n/a

Angelo Cosentini / n/a

The property sold for $21 million.

126-130 Delancey St

3-story retail bldg

n/a / n/a

n/a / Michael DeCheser, Massey Knakal

The property sold for $21 million.

76 Meserole St (Brooklyn)

49-unit apt. bldg

n/a / n/a

The property sold for $19.4 million, Brownstoner reported.

Lower Manhattan portfolio

6 mixed-use bldgs

n/a / n/a

n/a / B. Knakal, N. Petkoff, Massey Knakal

The package of mixed-use buildings sold for $19.25 million. The properties are located at 122 Nassau Street, 53 Nassau Street, 20 John Street, 8-10 Liberty Avenue, 16-18 Maiden Lane and 20 Beaver Street.

22-22 Jackson Ave (Queens)

Development site

Gershon & Company / M. Diana, P. Derbar, DY Realty Services

n/a / M. Diana, P. Derbar, DY Realty Services

The property sold for $16.5 million. The development will consist of 170 rental units, 120 parking spaces and 5,000 square feet of retail space.

The

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Buys continued Address

Size

Buyer/ Representative

Seller / Representative

Notes

Queens portfolio

3 apt. bldgs, 159 units total

Local investor / Yosef Katz, GFI Realty

G&H Building Co. / Daniel Shragaei, GFI Realty

The package sold for $16.45 million. The buildings are located at 153-19 89th Avenue, 138-42 90th Avenue and 90-25 138th Place in the Jamaica section of Queens.

One Flatbush Ave (Brooklyn)

Comm. bldg

Capstone Equities; Steve Shokouhi / n/a

n/a / n/a

The property sold for $14.2 million, the New York Post reported.

304 West 49th St

Parking garage

Imperial Parking Systems Inc. / n/a

Harvey Ravner / n/a

The garage sold for $14 million.

38-52 Fort Washington Ave

Two 6-story apt. bldgs, 86 units total

n/a / n/a

n/a / Robert Shapiro, Massey Knakal

The adjacent multi-family properties sold for $13.6 million. The residential units consist of one studio, one one-bedroom, 29 two-bedrooms, 25 threebedrooms, 23 four-bedrooms and six five-bedrooms. The properties have 40,605 square feet of additional air rights for future development.

383-391 Amsterdam Ave

4,070 sf retail condo

n/a / n/a

n/a / G. Garvin, P. Smadbeck, Massey Knakal

The retail condo sold for $12.2 million, or $2,998 per square foot.

612 Ocean Ave (Brooklyn)

6-story apt. bldg, 81 units total

n/a / Aaron Jungreis, Rosewood Realty

Wishbone Properties / Aaron Jungreis, Rosewood Realty

The property sold for $11.5 million.

221-223 East Broadway

6-story, 21,309 sf mixed-use bldg

n/a / n/a

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

The property sold for $11.3 million, or $530 per square foot.

3990 Bronx Blvd (The Bronx)

91-unit apt. bldg

n/a / Amit Doshi, Besen & Associates

The elevator building sold for $11 million, or $143 per square foot. The price represents a capitalization rate of 6.3 percent and a gross rent multiple of 9.

1681 and 1683 Third Ave

Comm. bldg and development rights

Extell Development / n/a

n/a / n/a

The commercial building at 1683 Third Avenue and the adjacent development rights on two plots sold for a combined $10.9 million.

123-125 Mulberry St and 186 Hester St

4-story mixed-use bldg and 5-story apt. bldg

Private investor / Tom Brady, Town Residential

125 Mulberry LLC / Tom Brady, Town Residential

The adjoining properties sold for $9.75 million.

19-25 West 20th St

Development site

n/a / n/a

n/a / B. Knakal, J. Ciraulo, Massey Knakal

The property sold for $9.75 million.

98-69/83 Queens Blvd (Queens)

25,664 sf office bldg

n/a / n/a

n/a / T. Donovan, P. Massey, Massey Knakal

The property sold for $9 million, or $351 per square foot.

1090 Saint Nicholas Ave

42-unit apt. bldg

n/a / P. Von Der Ahe, S. Edelstein, G. Kunofsky, S. Lefkovits, Marcus & Millichap

The property sold for $8.9 million.

711 Walton Ave (The Bronx)

6-story apt. bldg, 91 units total

n/a / n/a

n/a / Aaron Jungreis, Rosewood Realty

The elevator building sold for $8.6 million.

44-80 11th St (Queens)

79,700 sf development site

n/a / n/a

n/a / D. Junik, G. Blum, D. Baio, Pinnacle Realty

The property sold for $8.25 million.

436-438 West 52nd St

Two 5-story apt. bldgs, 28 units total

n/a / Glenn Raff, Besen & Associates

436 West 52 LLC / M. Besen, M. Slonim, Besen & Associates

The properties sold for $8 million, or $431 per square foot. The price represents a capitalization rate of 3.8 percent and a gross rent multiple of 15.

Brooklyn portfolio

5 apt. bldgs, 62 units total

n/a / n/a

n/a / S. Palmese, M. Amirkhanian, Massey Knakal

The package of multi-family buildings located in the Bedford-Stuyvesant section of Brooklyn sold for $7.65 million, or $168 per square foot. The properties are located at 257 Quincy Street, 308 Stuyvesant Avenue, 570 Jefferson Avenue, 788 Madison Street and 790 Madison Street.

1281 Fulton St (Brooklyn)

21,000 sf retail bldg

n/a / G. Kunofsky, R. Wachtler, J. Stewart, Marcus & Millichap

n/a / G. Kunofsky, J. Ventura, Marcus & Millichap

The property sold for $7.5 million. The building is net leased to a Walgreens drugstore.

53 Mercer St

3-story comm. bldg

n/a / n/a

National Sculpture Society / Robert Burton, Massey Knakal

The property sold for $7.4 million.

1384 First Ave

6-story apt. bldg

n/a / n/a

n/a / D. Cohen, A. Jungreis, Rosewood Realty

The property sold for $7.2 million.

133 East 65th St

5-story, 6,552 sf apt. bldg, 4 units total

n/a / n/a

n/a / Guthrie Garvin, Massey Knakal

The property sold for $7.2 million, or about $1,099 per square foot.

74-78 Post Ave

5-story apt. bldg, 68 units total

n/a / n/a

n/a / M. Guttman, A. Jungreis, Rosewood Realty

The property sold for $7 million.

3940 Carpenter Ave (The Bronx)

7-story apt. bldg, 76 units total

n/a / n/a

n/a / Aaron Jungreis, Rosewood Realty

The property sold for $6.9 million.

37-19 Crescent St (Queens)

7-story, 47,000 sf self-storage bldg

Tuck It Away/Rising Development Astoria LLC / A. Shmaruk, M. Sherman, Manhattes Group

19 Crescent Corp. / A. Shmaruk, M. Sherman, Manhattes Group

The new-construction self-storage building sold for $6.1 million, or $130 per square foot.

845 Gerard Ave (The Bronx)

6-story apt. bldg, 65 units total

n/a / n/a

n/a / Aaron Jungreis, Rosewood Realty

The property sold for $6 million.

461-465 46th St (Brooklyn)

41-unit apt. bldg

n/a / P. Von Der Ahe, M. Fotis, J. Hollingsworth, Marcus & Millichap

Institutional fund / M. Fotis, P. Von Der Ahe, J. Hollingsworth, Marcus & Millichap

The property sold for $5.6 million.

157 Bleecker St

5,100 sf mixed-use bldg

n/a / B. Dansker, Z. Ziskin, Marcus & Millichap

The property sold for $5.5 million. The building was delivered vacant.

3034 Grand Concourse (The Bronx)

5-story apt. bldg, 54 units total

Why Not LLC / n/a

1071 Home / n/a

The property sold for $5.5 million.

18 Bowery

4-story mixed-use bldg

Mooney House LLC / n/a

Chin Po and Diana Liu / n/a

The property sold for $5.4 million. The Edward Mooney House, as it is known, is the oldest row house in New York.

106-108 Convent Ave

5-story apt. bldg, 35 units total

n/a / n/a

n/a / M. Guttman, A. Jungreis, Rosewood Realty

The property sold for $5.3 million.

175 Ludlow St

5-story apt. bldg, 16 units total

n/a / n/a

n/a / David Scheer, Rosewood Realty

The property sold for $5.3 million.

31 West 87th St

4-unit apt. bldg

n/a / n/a

n/a / S. Edelstein, S. Lefkovits, P. Von Der Ahe, Marcus & Millichap

The property sold for $5.1 million. The price represents a capitalization rate of 2.9 percent.

336 East 15th St

4-story, 6,158 sf apt. bldg, 3 units total

n/a / n/a

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

The property sold for $5 million, or about $812 per square foot. The property has approximately 6,893 square feet of unused air rights.

2766 Barnes Ave (The Bronx)

6-story apt. bldg, 54 units total

n/a / n/a

n/a / Aaron Jungreis, Rosewood Realty

The building sold for $4.8 million.

2300 Kings Highway (Brooklyn)

6-story apt. bldg

n/a / n/a

n/a / A. Jungreis, R. Toledano, Weissman Realty

The property sold for $4.7 million.

345-47 West 19th St

Two 4-story apt. bldgs, 18 units total

Kenneth Willardt / Anne-Brigitte Sirois, Art State LLC

n/a / J. Nelson, B. Emmetsberger, Massey Knakal

The adjacent properties sold for $4.6 million, or about $732 per square foot.

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Buys continued Address

Size

Buyer/ Representative

Seller / Representative

101 West St (Brooklyn)

40,000 sf development site

n/a / n/a

n/a / D. Junik, G. Blum, D. Baio, Pinnacle Realty

The property sold for $4.55 million.

43-15 20th Ave (Queens)

1-story comm. bldg

Vaughn College / n/a

n/a / G. Blum, J. Tack, D. Baio, Pinnacle Realty

The property sold for $4.5 million.

640-642 East 236th St (The Bronx)

5-story apt. bldg

n/a / n/a

n/a / Aaron Jungreis, Rosewood Realty

The building sold for $4.5 million.

32-01 57th St (Queens)

Industrial bldg and vacant lot

Tibetan Community of New York & New Jersey / n/a

Elli Realty / n/a

The property sold for $4.4 million.

295 Hicks St (Brooklyn)

10,450 buildable sf development site

n/a / n/a

n/a / S. Palmese, J. Ciraulo, Massey Knakal

The property sold for $4.33 million, or $414 per buildable square foot.

67-03 and 67-29 Main St (Queens)

14,800 sf retail bldg

n/a / Steven Siegel, Marcus & Millichap

The property sold for $4.28 million.

14-33 31st Ave (Queens)

1-story, 14,500 sf comm. bldg and 7,250 sf lot

n/a / n/a

n/a / G. Blum, D. Baio, G. Margaronis, M. Cohen, Pinnacle Realty

The property sold for $4.1 million.

212 East 57th St

5,315 sf retail condo

Malachite Services LLC / Martin Ezratty, Eastern Consolidated

Sutton 57 LLC / B. Ezratty, M. Ezratty, Eastern Consolidated

The retail condo sold for $4.05 million. The property consists of space on the ground and lower-ground levels and is occupied by ILIAD New York, a purveyor of European furniture.

554 East 82nd St

5-story apt. bldg, 10 units total

n/a / n/a

n/a / Thomas Gammino Jr., Massey Knakal

The property sold for $4 million, or $480 per square foot.

716 and 720 West 180th St

Two 5-story apt. bldgs, 45 units total

n/a / n/a

n/a / M. Guttman, A. Jungreis, Rosewood Realty

The properties sold for $3.87 million.

14-16 Wooster St

3,600 sf retail space

n/a / n/a

n/a / Greg Kim, Tarter Stats Oâ&#x20AC;&#x2122;Toole

A long-term leasehold interest in the retail property sold for $3.85 million. In addition to the 3,600 square feet on the ground floor, the space has 3,000 square feet in the basement.

1259, 1265 and 1269 College Ave (The Bronx)

Three 5-story apt. bldgs, 63 units total

n/a / Lynda Blumberg, Besen & Associates

730 East 228 Realty LLC / Amit Doshi, Besen & Associates

The property sold for $3.85 million, or $84 per square foot.

1500 Westchester Ave (The Bronx)

9,600 sf retail bldg

n/a / Shlomo Manne, Marcus & Millichap

Private investor / Naomi Shu, Marcus & Millichap

The property sold for $3.83 million.

16 Minetta Lane

3-story, 2,800 sf mixed-use bldg

Adam Kushner / n/a

n/a / Shai Benhamou, Keller Williams NYC

The property sold for $3.75 million, or $1,339 per square foot. By using existing air rights, the site can be built up to 4,300 square feet.

70 Hester St

3-story mixed-use bldg

Private investor / Tom Brady, Town Residential

Pearl Goldman / Miriam Sirota, Brown Harris Stevens

The property sold for $3.69 million.

459 West 43rd St

5-story apt. bldg, 13 units total

n/a / Mansour Tabibnia, Azad Property Group

n/a / Billy Billitzer, Rosewood Realty

The property sold for $3.5 million, or $535 per square foot.

21-17 37th Ave (Queens)

1-story comm. bldg and adjacent lot

Parts Authority / n/a

121 West 92nd St

5.5-story, 6,426 sf apt. bldg

n/a / Matt Lesser, Leslie J. Garfield & Co.

n/a / H. Oster, J. Nelson, Massey Knakal

The property sold for $3.5 million, or $545 per square foot.

132 Lexington Ave

4-story, 4,685 sf apt. bldg, 3 units total

n/a / n/a

n/a / J. Ciraulo, M. Azarian, Massey Knakal

The property sold for $3.4 million, or about $736 per square foot.

2833 Decatur Ave (The Bronx)

Three 5-story apt. bldgs, 38 units total

n/a / Amit Doshi, Besen & Associates

2833 Decatur Associates LLC / Amit Doshi, Besen & Associates

The property sold for $3.38 million, or $110 per square foot.

228 East 75th St

4-story, 5,800 sf apt. bldg, 10 units total

n/a / n/a

n/a / Guthrie Garvin, Massey Knakal

The walk-up building sold for $3.3 million, or about $569 per square foot. The price represents a capitalization rate of 4 percent. The property has about 3,374 square feet of available air rights for future development.

102 Pierrepont St (Brooklyn)

6-story, 6,600 sf apt. bldg, 6 units total

n/a / n/a

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

The property sold for $3 million.

5721 Sixth Ave (Brooklyn)

15,038 sf office bldg

Private investor / n/a

n/a / J. Berman, V. Sozio, M. Tortorici, D. Tropp, Ariel Property Advisors

The property sold for $3 million.

2106 Honeywell Ave and 12 Clifford Pl (The Bronx)

Two 5-story apt. bldgs, 38 units total

n/a / Alan Zucco, Besen & Associates

2106 Honeywell Avenue LLC & 12 Clifford Place LLC / Michael Besen, Besen & Associates

The properties sold for $3 million, or $108 per square foot.

458 West 50th St

6-unit apt. bldg

Foreign investment fund / n/a

Private investor / J. Koicim, S. Lefkovits, P. Von Der Ahe, R. Hunter, Marcus & Millichap

The property sold for $2.98 million.

47-28 11th St (Queens)

20,000 sf development site

n/a / n/a

n/a / D. Baio, G. Blum, D. Junik, Pinnacle Realty

The property sold for $2.83 million.

682-684 Myrtle Ave (Brooklyn)

Two 4-story apt. bldgs, 12 units total

n/a / n/a

n/a / M. Guttman, A. Jungreis, Rosewood Realty

The properties sold for $2.6 million.

157 Hudson St

4,165 sf retail condo

Lebfin Real Estate Company LLC / Greg Kim, Tarter Stats Oâ&#x20AC;&#x2122;Toole

VE Equities LLC / Alan Miller, Eastern Consolidated

The property sold for $2.55 million.

17 East 17th St (Brooklyn)

4-story apt. bldg

n/a / n/a

n/a / Aaron Jungreis, Rosewood Realty

The property sold for $2.43 million.

620 West 182nd St

5-story apt. bldg, 18 units total

n/a / n/a

n/a / M. Guttman, A. Jungreis, Rosewood Realty

The property sold for $2.4 million.

3128 Villa Ave (The Bronx)

Apt. bldg

n/a / n/a

n/a / M. Kerwin, J. Birnbaum, A. Jungreis, Rosewood Realty

The property sold for $2.4 million.

307-311 Union Ave (Brooklyn)

2 lots, 15,000 buildable sf total

n/a / n/a

n/a / Massey Knakal

The vacant lots sold for $2.25 million, or $150 per buildable square foot, Brownstoner reported.

3340 Decatur Ave (The Bronx)

27-unit apt. bldg

n/a / Marco Lala, Marcus & Millichap

Private investor / Marco Lala, Marcus & Millichap

The property sold for $2.25 million.

444-446 West 163rd St

2 vacant lots

Affordable housing developer / Elizabeth Martin, Ariel Property Advisors

National real estate investment group / M. Tortorici, V. Sozio, S. Shkury, Ariel Property Advisors

The development site sold for $2.15 million. Zoning for the 75-foot wide property allows for 33,750 buildable square feet for residential use, as of right, and 54,844 buildable square feet, as of right, with a community facility bonus.

606 St. Nicholas Ave and 129 Edgecomb Ave

2 apt. bldgs, 16,110 sf total

Private investor / V. Sozio, M. Tortorici, J. Deutch, Ariel Property Advisors

The properties sold for $2.09 million.

11 West 30th St

2,000 sf retail co-op

n/a / n/a

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

The ground-floor commercial co-op sold for $1.88 million, or about $937 per square foot.

Other Deals n/a / n/a

house ad

Notes

The property sold for $3.5 million.

84 March 2013 www.TheRealDeal.com

074-088 march deal sheet se FINAL.indd 7

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STU NNI NG R E N TA L APARTME NTS WITH 8 0,000 S Q FT OF UNRIVALED AM E N I T I E S

N OW L E A S I N G STUDIOS FROM $2,800

I M M E D I AT E O CC U PA N C Y

1 BEDROOMS FROM $3,450

1 BED HOME OFFICE FROM $3,900

2 BEDROOMS FROM $4,500

212.876.6666 | MERCEDESHOUS ENY.COM | 550 W. 54TH STREET

Buys continued Address

Size

Buyer/ Representative

Seller / Representative

Notes

462, 471 and 473 Central Ave (Brooklyn)

3-story apt. bldg, 18 units total

Local investors / Joseph Landau, GFI Realty

Andrew Reaccuglia / Daniel Shragaei, GFI Realty

The walk-up building sold for $1.83 million. The price represents a gross rent multiple of 8.

2255-57 Adam Clayton Powell Blvd

3,996 sf comm. condo

n/a / V. Sozio, M. Tortorici, S. Shkury, Ariel Property Advisors

The ground-floor retail condo sold for $1.8 million.

676 Nereid Ave (The Bronx)

4-story, 17,952 sf apt. bldg, 22 units total

n/a / n/a

n/a / Karl Brumback, Massey Knakal

The property sold for $1.68 million, or $93 per square foot. The price represents a capitalization rate of 7 percent and a gross rent multiple of 6.5.

75 St. Marks Ave (Brooklyn)

3-story mixed-use bldg

n/a / n/a

n/a / Ofer Cohen, TerraCRG

The property sold for $1.64 million, or $441 per square foot.

Bronx portfolio

3 apt. bldgs

Private investor / S. Hirschfield, V. Sozio, M.Tortorici, Ariel Property Advisors

Real estate investment group / S. Hirschfield, V. Sozio, M.Tortorici, Ariel Property Advisors

The package sold for $1.61 million. The properties are located at 983 Summit Avenue, 404 East 175th Street and 500-02 East 183rd Street.

5122-24 Broadway

11,255 sf development site

n/a / n/a

Private investor / M. Tortorici, V. Sozio, S. Shkury, Ariel Property Advisors

The vacant lot sold for $1.52 million.

316 East 126th St

8,615 sf apt. bldg

Private investor / V. Sozio, M. Tortorici, D. Tropp, J. Deutch, Ariel Property Advisors

The property sold for $1.5 million.

1130-36 President St (Brooklyn)

8,100 sf mixed-use bldg

Private investor / Michael Vitale, Royal Associates Realty Inc.

Private investor / J. Berman, M. Tortorici, V. Sozio, Ariel Property Advisors

The property sold for $1.4 million.

940 Kent Ave (Brooklyn)

4-story, 6,872 sf apt. bldg, 8 units total

n/a / n/a

n/a / Michael Amirkhanian, Massey Knakal

The property sold for $1.33 million, or $193 per square foot.

97-99 and 101-103 Arlington Ave (Brooklyn)

2 apt. bldgs, 17 units total

Local investor / Shulem Paneth, GFI Realty

Local investor / Yanni Simantov, GFI Realty

The contiguous walk-ups sold for $1.28 million. The price represents a gross rent multiple of 7.

75-77 East 110th St

20,184 buildable sf development site

n/a / n/a

Private investment fund / M. Tortorici, V. Sozio, S. Shkury, Ariel Property Advisors

The vacant lot sold for $1.23 million.

119-01 Jamaica Ave (Queens)

1-story, 3,000 sf retail bldg

n/a / n/a

n/a / Brian Sarath, Massey Knakal

The property sold for $1.2 million, or $400 per square foot.

36 Marble Hill Ave

4-story, 10,310 sf apt. bldg, 9 units total

n/a / n/a

n/a / R. Shapiro, D. Maurer, Massey Knakal

The property sold for $1.13 million. The residential units consist of five rentstabilized apartments and four free-market apartments. All of the units are three-bedrooms, with the exception of the basement apartment, which is a two-bedroom that has its own private backyard.

1520 Grand Concourse (The Bronx)

16-unit apt. bldg

n/a / n/a

n/a / Sharone Sohayegh, Sohayegh Realty

The property sold for $1.1 million. The price represents a gross rent multiple of 7.

383 Troutman St (Brooklyn)

5,000 sf industrial bldg

n/a / n/a

n/a / Michael Amirkhanian, Massey Knakal

The property sold for $1.09 million, or about $218 per square foot.

310 West 118th St

10,000 buildable sf development site

Private development group / V. Sozio, J. Deutch, Ariel Property Advisors

Private investor / V. Sozio, J. Deutch, Ariel Property Advisors

The vacant lot sold for $1.06 million.

Financing Address

Size

Borrower / Representative

Lender / Representative

Notes

435 West 50th St

71-unit apt. bldg

JDS Development Group; Property Markets Group / Jason Cohen, Mission Capital Advisors

PB Capital / n/a

A $45 million construction loan was provided for the new luxury condos, the Wall Street Journal reported. The developers plan to begin sales later this year, according to the paper.

537 West 27th St

28-unit apt. bldg

Tavros Capital Partners USA LP / Steven Klein, HFF

n/a / n/a

An $18.5 million acquisition loan was provided for the Chelsea Muse rental building.

7 Park Ave

226-unit apt. bldg

The Seven Park Avenue Corp. / n/a

NCB / n/a

An $8.5 million first mortgage and a $500,000 line of credit were arranged for the building.

350 Bleecker St

122-unit apt. bldg

350 Bleecker Street Apartment Corp. / n/a

NCB / n/a

A $4.3 million first mortgage and a $500,000 line of credit were arranged for the building.

315 West 232nd St

71-unit apt. bldg

315 West 232nd Street Corp. / n/a

NCB / n/a

A $2.8 million first mortgage was arranged for the building.

31-85 Crescent St (Queens)

115-unit apt. bldg

Crescent Tenants Corp. / n/a

NCB / n/a

A $1.8 million first mortgage and a $500,000 line of credit were arranged for the building.

35 Mercer St

6-unit apt. bldg

Grand and Mercer Street Corporation / n/a

NCB / n/a

A $2 million first mortgage and a $250,000 line of credit were arranged for the building.

402 East 74th St

41-unit apt. bldg

402 East 74th Street Corp. / n/a

NCB / n/a

A $1.7 million first mortgage and a $500,000 line of credit were arranged for the building.

375 Lincoln Pl (Brooklyn)

35-unit apt. bldg

375 Lincoln Place Ownersâ&#x20AC;&#x2122; Corp. / n/a

NCB / n/a

A $1.8 million first mortgage and a $200,000 line of credit were arranged for the building.

519 East 86th St

35-unit apt. bldg

519 East 86th Street Tenants Corp. / n/a

NCB / n/a

A $1.5 million first mortgage and a $250,000 line of credit were arranged for the building.

165 Hudson St

15-unit apt. bldg

Spice Lofthouse Corp. / n/a

NCB / n/a

A $1.4 million first mortgage and a $300,000 line of credit were arranged for the building.

10 Bleecker St

22-unit apt. bldg

10 Bleecker Street Owners Corp. / n/a

NCB / n/a

A $1.4 million first mortgage was arranged for the building.

300 West End Ave

30-unit apt. bldg

300 West End Avenue Associates Corp. / n/a

NCB / n/a

A $1.3 million first mortgage was arranged for the building.

18-20 East 84th St

24-unit apt. bldg

18-20 Park 84 Corp. / n/a

NCB / n/a

A $1 million first mortgage was arranged for the building.

101 Wooster St

12-unit apt. bldg

Wooster Owners Inc. / n/a

NCB / n/a

A $750,000 first mortgage and a $250,000 line of credit were arranged for the building.

For the best deal, visit our website: www.TheRealDeal.com 80 2009 www.TheRealDeal.com 86 July March 2013 www.TheRealDeal.com

074-088 march deal sheet se FINAL.indd 8

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Steven Vegh is proud to announce the formation of Westwood Realty Associates Advised on over

$500,000,000 in off-market transactions in 2012

Transactions completed in 2012 include:

Sold

Re-Cap

New York NY

Brooklyn NY

$210,000,000

$53,000,000

$13,750,000

21 Story 352 Apts And Retail 250 Car Parking Garage 305,000 Sq Ft

17 Story 109,000 Sq Ft 128 Apts And Retail

4 Story Walk Up Loft Style 32 Apartments

$62,000,000

Sold

NNN Lease Credit Tenant 30 Year Term

Bronx NY

New York NY

Brooklyn NY

Bronx NY

$6,850,000

$12,375,000

$9,750,000

$33,998,250

5 Story Walk Up 84 Apartments

Sold

4 Story Walk Up 16 Apartments 4 Retail

Sold

New Construction 9 Story 29 Apts And Retail

Sold

2 Building Package 490 Apartments

Sold

Brooklyn NY

Bronx NY

Brooklyn NY

$10,000,000

$6,064,185

$15,300,000

$1,850,000

Loft Style Residential Building Approx. 60,000 Sq Ft

Steven Vegh 44 Wall Street, 2nd Floor New York, NY 10005 Direct: 212-961-6833 steven@westwoodra.com

Multi Tenant Retail Condo Luxury Building

3 Building Package 175 Apartments

3 Building Package 18 Apartments

WEST WOOD R E A L T Y A S S O C I AT E S westwoodra.com

Other Deals RXR Realty pays $800M for 237 Park Avenue

Related gets $390M in construction funding

Continuing a whirlwind acquisition spree, RXR Realty bought 237 Park Avenue for around $800 million, Crain’s reported last month. In partnership with Walton Street Capital, RXR scooped up the 21-story, 1.2 million-squarefoot building, located between East 46th and East 47th Streets, from Lehman Brothers Holdings, which had previously foreclosed on the troubled asset and recovered it from Broadway Partners. Scott Rechler, RXR’s chief executive, told Crain’s that he would invest several million dollars to renovate the building. “It is consistent with what we’ve been looking for,” Rechler said. “It’s a good building with good bones that we can acquire at a large discount to what it would cost to replace the asset.” (The deal was announced after the deadline for the Deal Sheet.)

The Related Companies nabbed two construction loans totaling $390 million, Crain’s reported last month. One loan will be used to fund the expansion of the Gateway Center mall in East New York, Brooklyn, and the other will fund the construction of a Queens affordable housing development. Bank of America, along with PNC Bank and Sovereign Bank, will lend $225 million for the Brooklyn project. The construction will add 600,000 square feet to the existing 900,000-square-foot structure. Bank of America, along with Wells Fargo, will lend $165 million to a venture between Related, Phipps Houses and Monadnock Construction to build the first of a two-building housing complex in Hunters Point, Queens. (The deal was announced after the deadline for the Deal Sheet.)

Eric Hadar, partners buy Brill Building for $185M

Area sells Upper Manhattan portfolio for $49M

Stonehenge Partners and Invesco Real Estate sold the Brill Building at 1619 Broadway for $185 million to Eric Hadar and Merchants Hospitality, the New York Post reported last month. Adam Spies and Doug Harmon of Eastdil Secured brokered the deal, which included 30,000 square feet of air rights, sources told The Real Deal. In addition, eight new signs for roughly 5,000 square feet of advertising space were approved, which will bring in about $2 million per year in revenue. Other firms — such as Taconic Investment Partners, Ashkenazy Acquisition Corp. and a joint venture between Starwood Property Trust and the Witkoff Group — mulled buying the property, sources said. (The deal was announced after the deadline for the Deal Sheet.)

Area Property Partners sold a packageof 10 Upper Manhattan multi-family properties known as the Decathlon portfolio for $49 million, or about $7.5 million less than the firm paid for the collection of buildings in 2007, according to records filed with the city last month. The buildings range from 961 St. Nicholas Avenue, a six-story, 56-unit property in Washington Heights — the southernmost point of the portfolio — to 248 Sherman Avenue, a five-story, 44-unit property in Inwood at the northernmost point. All together, the package encompasses a total of 474 prewar units in the Washington Heights and Inwood neighborhoods, with 116 of them renovated. (The deal was announced after the deadline for the Deal Sheet.)

Large Vinegar Hill development site sells for $25M AlargedevelopmentsiteinBrooklyn’sVinegarHillneighborhood sold for $25 million and is likely to attract major national retailers, the New York Observer reported last month. The site, located at 39-53 Jay Street, currently holds a threestory, 80,000-square-foot manufacturing property. “This site has the largest footprint in Vinegar Hill, and possibly in all of the greater Downtown Brooklyn market,” Stephen Palmese, the director of sales at Massey Knakal and the exclusive broker on the transaction, told the Observer. “The ability to offer big box retail could really change the landscape.” (The deal was announced after the deadline for the Deal Sheet.)

Extell beefs up Third Avenue acquisitions with $8 million mixed-use building Gary Barnett’s Extell Development expanded its holdings on a stretch of the Upper East Side last month, paying $8.63 million for a mixed-use building at 1685 Third Avenue to landlord Ogrin Associates, on the same day that Extell sold Ogrin a property at 1570 Second Avenue for less than half the purchase price, city records show. The deal appears to be part of a larger move by Extell to acquire, and possibly develop, the stretch of Third Avenue between East 94th and East 95th streets. The 6,648-square-foot property lies in a residential zone that allows for the highest density residential development in the city, a Department of City Planning spokesperson previously told The Real Deal. (The deal was announced after the deadline for the Deal Sheet.) TRD

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Development updates CONSTRUCTION UPDATE

East Harlem

East Harlem Center for Living and Learning East 104th Street Construction has begun at the 143,000-square-foot East Harlem Center for Living and Learning, developed by Jonathan Rose Companies. The $75.8 million project, which received $32.5 million from the U.S. Department of Education and the New York City School Construction Authority, will include a charter school, 88 affordable housing units and 6,000 feet of office space reserved for nonprofit organizations. Contact: www.rosecompanies.com.

$2.5 million. Building amenities include a residents’ lounge, children’s playroom, fitness center, business center, on-site parking, concierge service and 24-hour attended lobby. Corcoran Sunshine Marketing Group is the agent. Contact: www. 1rectorpark.com. 225 Rector Place The 289-unit, 23-story condominium, developed by Related Companies and designed by Gruzen Samton Steinglass, is now 225 Rector Place

LEASING UPDATES

Clinton

Icon 306 West 48th Street The 43-story, 122-unit rental tower, developed by First Dominion Developments and designed by IsIcon mael Leyva Architects, is now 50 percent leased. Available units include studios and one- and two-bedroom units ranging in size from 520 to 1,285 square feet. Asking rents in the building range from $3,400 to $7,250 per month. Building amenities include a fitness center and landscaped roof deck. Town Residential is the listing agent. Contact: www.iconmanhattan.com.

CMY

Murray Hill The Grayson 247 East 28th Street The 125-unit, 17-story rental tower, developed by the Silverstone Property Group, is now 75 percent leased. Available units include one-bedroom apartments with monthly rents starting at $3,875 and ranging in size from to 670 to 675 square feet, and two-bedroom apartments sized from 820 to 855 square feet and priced from $5,095 per month. Building amenities include an attended lobby, residents’ lounge, fitness center, outdoor garden and roof deck. Town Residential is the agent. Contact: www.thegraysonnyc.com. SALES UPDATE

Battery Park City 1 Rector Park 333 Rector Place The 174-unit, 14-story condo conversion, developed by River Rose LLC and designed by Costas Kondylis & Partners, is now 90 percent sold. Remaining residences include studios and one-, two- and three-bedroom apartments ranging from 550 to 2,363 square feet, and priced from $675,000 to

60 percent sold. Remaining units include studios and one- , two- and three-bedroom homes ranging in size from 550 to 1,963 square feet. Prices range from $500,000 to $2.7 million. Building amenities include a pool, fitness center and children’s playroom. Related Companies is the agent. Contact: www.rectorplace225.com.

Brighton Beach Oceana Condominium and Club 50 Oceana Drive West The 59-unit condominium, developed by Muss Development and designed by SLCE Architects and Moss Gilday Group, is now 53 percent sold. Remaining units include two- and three-bedroom residences and one penthouse unit, ranging in size from 1,015 to 1,909 square feet. Apartments range in price from $740,000 to $1.7 million. Building amenities include outdoor and indoor pools, a health club, oneacre park and 24-hour staffed gatehouse. Contact: www.OceanaUSA.com.

Flatiron

The Whitman 21 East 26th Street Sales have launched at the four-unit condo conversion. Available units include three full-floor, 4,967-squarefoot residences priced from $10 to $10.5 million. A 6,540-squarefoot-duplex penthouse is priced at $22.5 million. Building amenities include a 24-hour doorman, gym, private storage space and private elevator landing. Douglas Elliman is the agent. Contact: www.elliman.com. Compiled by Andrea Cetra The Whitman

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Two-bedroom, two-bath, 1,005-squarefoot condo in elevator building (Two Worldwide Plaza); apartment has terrace, hardwood floors and laundry; building has doorman, concierge, health club with pool, garage and courtyard; common charges $1,253 per month; taxes $1,435 per month; asking price $1.19 million; one month on the market. (Brokers: Gabriel Bedoya, the Corcoran Group; Ann Takahashi, Bond New York) “My buyer, a private investor, was referred to me. Her original aim was to find an apartment for her daughter, then [she] saw the value as an investment. We looked at 35 apartments, made a couple of offers and finally chose this one. [The buyer] was enamored with the water and skyline views, the custom-designed built-ins for storage and the full-service building. A major challenge was working with the lender. The sale took a bit longer than expected due to bank delays caused by the increase in sellers wanting to close by the end of the year. Even with the buyer’s outstanding relationship with the lender, it was still an arduous task to get the process expedited.” Ann Takahashi, Bond New York

Upper West Side $1.39 million 150 West 79th Street, Apt. 2EF

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Three-bedroom, three-bath, 2,300-squarefoot co-op in prewar elevator building (the Dorset); apartment has hardwood floors; building has part-time doorman, live-in super, roof deck, bike room, storage, laundry and backyard; maintenance $2,320 per month; asking price $1.39 million; three weeks on the market. (Brokers: Pamela Berman, Stribling & Associates; Louise Phillips Forbes, Halstead Property) “This was my first real estate deal! The previous owner, Jack Gottlieb, recently passed away after 30 years in the apartment. One of the co-executors of the estate is

a longtime friend and colleague from when I used to work in the theater business. My friend offered me the exclusive. Gottlieb was [composer] Leonard Bernstein’s longtime associate, so I had a joke about the walls of the apartment being able to sing. It was a spacious apartment with great “bones,” but needed renovation to open it up and modernize it. [In pricing the apartment], we knew that most buyers would want to spend a good deal more to renovate it to their own tastes. I would have to say that the buyers found us. I released the listing, and two days later I had my first — and only — open house. The buyers felt that the space and location worked for them. Once the new owners were approved by the co-op board, everyone was quite satisfied.” Pamela Berman, Stribling & Associates

Upper West Side $1.6 million 90 Riverside Drive, Apt.10C

Two-bedroom, two-bath, 1,300-squarefoot co-op in prewar elevator building; apartment has formal dining room; building has doorman, concierge, gym, storage, laundry and courtyard; maintenance $2,120 per month; asking price $1.65 million; five weeks on the market. (Brokers: Ann Cutbill Lenane, Douglas Elliman; Jennifer Bogner, Maxwell Jacobs) “The buyer, a good friend of mine, asked me to go to a few open houses with her, and we went to three of them. As soon as she saw this one, she knew. It’s a beautiful building; it has high ceilings. It’s not a really large apartment, but it has a feeling of grandeur. They wanted to put in their own style of kitchen, and that wasn’t a problem. The building has a half-basketball court. They have a 13-year-old son, so the court wasn’t a requirement but it was a huge plus. It was really important for the seller to close by year’s end because of the change in capital gains taxes at the end of 2012. We were a little nervous about the year-end closing because they had to get a mortgage, but it all worked out. The contract was signed in October and we were able to close and get the mortgage by year’s end.” Jennifer Bogner, Maxwell Jacobs Compiled by Evan Bleier

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Commercial market

from page 22

Megabuildings in the area include Moinian’s proposed 1.8 milllion-square-foot 3 Hudson Boulevard; Related’s under-construction, 1.7 million-square-foot Coach building at 10th Avenue and 30th Street; and Brookfield’s planned Manhattan West, which could bring 5.4 million square feet of office and residential space to Ninth Avenue. Extell has also proposed a 1.7 millionsquare-foot tower in the area dubbed 1 Hudson Yards. Moinian might develop the foundation at 3 Hudson, but he is unlikely to start construction on the project without a tenant committed to at least 400,000 square feet, according to the building’s broker, Avison Young’s Arthur Mirante. Mirante said the asking rent is $85 per square foot in the building. That’s far above the average asking rent in Midtown South overall, but newly constructed Class A office towers typically charge higher rents than existing

buildings do. In fact, the average rent for Midtown South was $49 per square foot last month, up 3 cents from the prior month. The availability rate rose by 0.1 point, although 3 Hudson did not affect either rate because DTZ excludes buildings that are not yet complete. Mirante said Avison Young is reaching out to tenants such as Time Warner, News Corp., CBS and advertising-media company GroupM. But while rival developers are also reportedly reaching out to some of those companies, Mirante said he doesn’t view the competition as a zero-sum game. Instead, he said, the buildings are together creating something of a new submarket, which will help attract more and more tenants. “[It] removes the ‘I don’t want to be first’ frontier aspect of Hudson Yards,” Mirante said.

Downtown The average asking rent Downtown rose last month by 15 cents per square foot to $41.60, DTZ figures showed. The availability rate was flat at 13 percent. During an earnings call last month, Brookfield CEO Dennis Friedrich said tenants have signed letters of intent (indicating a late stage in the lease negotiation process) to take some 1.5 million square feet in the company’s Brookfield Place (formerly World Financial Center), where Bank of America’s lease ends in October. Meanwhile, landlords like SL Green Realty are laying out cash to lure Midtown South tech firms. “We’re designing our capital program to appeal to the Midtown South and sort of the traditional Midtown tenants, particularly some of the more creative media and tech-type tenants,” Steven Durels, SL Green’s director of leasing, said during the company’s most recent earnings call in late January. TRD

Investment sales firms from page 36 “We are very pleased with the 2012 increase in our transactional sales deals, and when you include our substantial note sales, equity raise, financing and advisory business revenues, 2012 was a great year for Eastern Consolidated,” said Daun Paris, president of Eastern Consolidated. In a sense, it’s no surprise that Massey Knakal came out on top in the commission category because the year was a veritable feeding frenzy for the firms that sell properties priced below $50 million. In fact, nearly 90 percent of the brokered transactions that TRD reviewed were below that threshold, and about two-thirds of the estimated $350 million paid in brokerage commissions last year was paid to those who brokered smaller deals. Foreign investment continued to spur sales on the lowerpriced deals in the city. “[Overseas buyers] started to pull the trigger a lot more than a year ago. There is a lot more confidence in the New York market,” Josh Rahmani, CEO of Venture Capital Properties, a Midtown-based brokerage, said.

A widening gulf The top firm for sales volume, Eastdil, saw its transactions fall by about 7 percent, according to TRD’s figures (although sources familiar with the firm’s deals dispute that and claim the company saw an increase over 2011 to $9 billion). Either way, the firm — whose New York office is led by Doug Harmon and Adam Spies — widened its lead over its chief rival, CBRE, and captured a larger stake in what was left of the thin trophy deal market. It brokered seven of the city’s top 10 building sales of the year. Harmon and Spies declined to comment. The two firms, who typically hit similar sales volume marks, are now separated by more than $3.5 billion, because CBRE saw transaction totals fall by nearly 40 percent. Officials at CBRE declined to comment. But insiders attribute the drop at CBRE, where the New York capital markets group is headed by Darcy Stacom, to the meager trading by large institutional players of big office buildings in Manhattan, the global firm’s go-to clients. Sources also note that several of the firm’s biggest listings were pulled from the market, such as 11 Madison Avenue, which had an asking price of $1.5 billion. However, most of the other national firms that focus on large deals grew their sales volume totals last year, including JLL, which saw a roughly 76 percent spike, and HFF (Holliday Fenoglio Fowler), which experienced a 47 percent jump.

Sources said that the trophy office sales market dried up partly because investors were wary of the slow leasing activity by still-cautious financial tenants. However, David Ash, a principal at the boutique firm Prince Realty Advisors, said the rise in leasing by media and technology companies has helped fuel sales of the older buildings those firms are locating to outside of Midtown’s core. “There are a lot more creative companies around today bucking the traditional trends of corporate America,” he said. Still, the question many are asking is: Why did some firms gain ground and others lose it when the overall investment sales trading volume jumped by 53 percent last year? In order to better understand the lay of the investment sales land and TRD’s ranking, insiders say it’s important to grasp the difference between the types of commercial firms. For example, in New York, institutional firms like Eastdil, CBRE, Cushman, JLL and HFF often revolve around one highly productive team of brokers and deal with global funds and high-end institutional investors locking up transactions with exclusive listings. Those buyers and sellers were less active in making trophy office trades last year. Meanwhile, regional players like Massey Knakal and Eastern Consolidated, and local offices of national firms such as Marcus & Millichap, typically have larger rosters of brokers who manage their own deals. They often specialize in sales below $50 million and also typically work on exclusive listings. Next are smaller companies that are often built around one key dealmaker or a team that specializes in open listings: Rosewood, Ariel Property Advisors, Capin & Associates and broker Ivan Hakimian’s new firm, HPNY, fall into this category. Finally, there are the commercial arms of the residential brokerage firms. As hybrids, they often attract little attention, although the Corcoran Group’s commercial team did a respectable $295 million in deals in 2012. One team at Corcoran — the Corcoran Wexler Healthcare Properties team — focuses on the medical property market and boomed last year in part because of the U.S. Supreme Court’s upholding of President Barack Obama’s Affordable Care Act, according to Paul Wexler, who heads up the group. “A great level of interest came as a result of Obamacare,” Wexler said. He explained that with 30 million more Americans set to get insurance coverage, healthcare providers and investors are anticipating greater demands and started making real estate acquisitions to prepare.

Extraordinary gains Insiders say that in addition to the increased volume on the lower end of the market, some firms were also boosted by old-fashioned pavement pounding in 2012. They point to Rosewood president Aaron Jungreis’s unusually aggressive commission pricing and work schedule. Insiders say brokers often reduce fees, but most are loath to admit it. Jungreis, however, was unapologetic. “A smaller fee is better than getting no fee at all,” he said, although he attributed the bulk of his success last year to hard work, not to cutting fees. “I know I am not the smartest guy in the room, so I stick to one thing: multi-family,” he said. “I live and breathe and sniff multi-family all day. I know every building in the boroughs — how many units, who’s next door and across the street. That, to me, is the most efficient way to do so many deals.” Whatever his strategy, it worked. Jungreis’s scrappy company, which was founded in 2008, nearly tripled its sales volume last year to $1.4 billion, placing it nearly in the same league as firms like JLL, a global company, and Massey Knakal, which is local but has been around since 1988. With about a dozen brokers and salespeople, Rosewood did an astonishing 124 deals. Massey Knakal did more than 200 deals, but with about 89 real estate sales professionals at the firm. Other small firms jumped in revenue, relatively speaking. The biggest percentage jump was achieved by Colliers International, which brokered one large transaction — the sale of a minority value in a package of buildings including 641 Fifth Avenue, valued at $320 million — that boosted its totals. Shimon Shkury’s Ariel Property saw the second highest percentage jump of the year, rising fivefold to $181 million. Shkury credited some of that to a hiring surge. “In 2012, we doubled our staff and we’re laying a foundation to accommodate future growth,” he said. But some of the smaller firms did not fare well in 2012. Itzhaki Properties (without its top agent Hakimian), Cassidy Turley and retail-focused firm RKF also saw a decrease in sales volume. Looking ahead, Rahmani said he anticipated a lively 2013. He said many of those who sold last year are now feverishly trying to purchase properties so that they can take advantage of so-called 1031 tax exchanges, which allow for tax deferments in the wake of a sale if another property is acquired within 180 days. “At the year end, there was a lot of 1031 money in the market that was starting to roll. We are expecting it to be an active year,” Rahmani said. TRD

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Office leasing

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is especially significant because brokerages don’t publicly release this type of sensitive data. The seven ranked firms all declined to comment. CBRE and NGKF were also among several firms that objected to TRD’s methodology. “Most brokers are inherently secretive, and their currency is information,” said Joseph Thanhauser, chairman of Midtown-based brokerage Byrnam Wood.

Take-home pay The estimated $750 million in leasing commissions that Manhattan landlords doled out to these firms in 2012 — landlords customarily pay commissions for both their broker and the tenant’s agent — was not evenly distributed among the city’s major brokerage firms. Not surprisingly, the commission ranking broke down in the same order as the transaction volume, with CRBE raking in the most. The firm took in an estimated revenue of between $200 million and $250 million. NGKF, meanwhile, earned between $110 million and $150 million in revenue according to TRD’s calculation. Next was a cluster of three firms — Studley, Cushman and JLL — that, according to TRD’s estimates, each earned approximately $75 million and $100 million. Trailing them was Cassidy Turley, with between $25 million and $30 million, and Colliers with between $15 million and $25 million, according to TRD’s figures. Other national and international firms with a modest presence in Manhattan include UGL Services, Transwestern and Lee & Associates. There are also local firms that do a substantial amount of brokerage, such as Savitt Partners, Murray Hill Partners and ABS Partners Real Estate. TRD’s commission ranges take into account the fact that the terms of most deals — including the length of the lease

and the exact price per square foot — are not publicly recorded. The ranges also consider that commissions are negotiable, and that firms often give a so-called commission rebate back to tenants on larger, pricier deals. Real estate professionals also cautioned that it’s impossible for an outsider to predict exactly how much a landlord paid a broker in commission despite the standard rates. Nonetheless, the ranking brought to light some key facts, including just how lucrative tenant-side deals are. Industry standard dictates that the tenant-side broker typically gets a commission fee that’s two to four times that of the landlord’s agent. Indeed, the tenant brokerage typically takes home what’s called a full commission — approximately a third of the first-year’s rent. On a hypothetical 10-year, 100,000-square-foot lease valued at $50 per square foot, that would total about $1.63 million. But insiders say for deals larger than 100,000 square feet, the landlord will allot a full commission to the tenant broker, but that broker will then “rebate” a portion of it back to the tenant. (In Class A office buildings, landlords generally only pay a quarter to a third of a full commission, while in older buildings they pay a higher rate.) “It is all negotiable,” Glenn Brill, a managing director in corporate finance at the Midtown office of the London-based FTI Consulting, said. In some instances, tenants “set up real estate subsidiaries and the brokers split the commission with them, effectively reducing their cost.” Driving home the reality that there’s increased earning potential on the tenant side, TRD’s ranking showed that brokerages that represented a disproportionate number of office-space hunters had strong commission numbers. For example, TRD estimated that about 75 percent of CBRE’s

office leasing revenue was derived from tenant-side deals. The company represented six of the tenants in the top 10 largest leases for the year, including Viacom in a blockbuster 1.6-million-square-foot renewal and expansion at 1515 Broadway. TRD estimated that commission at $60 million, prediscount. One source familiar with the deal, however, maintained CBRE took home significantly less than $30 million on that transaction. Meanwhile, on the landlord side of the business, the first four firms were CBRE, NGKF, JLL and Cushman. While this is the first time TRD has produced this ranking, sources said JLL would probably not have ranked this high in prior years. The company has grown its agency business significantly since 2011, when it poached a large leasing team from Cushman that includes Mitchell Konsker and Paul Glickman. Viacom and CBRE did not respond to a request for comment, and landlord SL Green Realty declined to comment. Meanwhile, TRD’s ranking also showed that tenant-side brokerages, like Studley, took in more money with fewer transactions. The company, headed by CEO Mitchell Steir, saw tenant-side revenues that were more than 85 times higher than its handful of landlord deals, which were virtually all subleases. The company declined to comment, but meeting records from the Port Authority of New York and New Jersey showed that the firm earned a $4.4 million commission for a 270,104-square-foot lease at One World Trade Center. That’s a 60 percent discount off the expected full commission of more than $11 million, but still one of the city’s top 20 commissions, TRD’s review reveals. However, landlord-side work is also fiercely fought over, partly because brokers don’t have as much of a learning curve with each new deal since they are working in a limited number of buildings, and partly because it’s a more steady and guaranteed stream of business. TRD

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from page 34

not to be named. That pace, the source said, was simply unrealistic; the appraisal form for a Fannie Mae home, for example, includes more than 800 questions. Knobel acknowledged that a handful of appraisers might have completed dozens of forms — but only rarely. “And say you do [unit] 3B [in a particular building] and you get an order for 4B — how many of those fields do you have to redo?” Miller did not point specifically to MMJ, but generally described his high-volume competitors during the boom years as “deal enablers.” “They would mushroom in size and work mostly for mortgage brokers,” he said. The real estate downturn, though, isn’t the only reason why appraisers hit the skids. It was a regulation that went into effect in 2009. As TRD and others have reported, the Home Valuation Code of Conduct — called “havoc” by appraisers — requires third parties called appraisal management companies to dole out appraisal assignments instead of brokers and bankers. The intent of the regulation was to create a firewall between the lender and the appraiser, preventing mortgage brokers from dictating, or trying to dictate, appraisal values. “[The change] destroyed the mortgage broker world and the traditional appraisal world,” one source said. Knobel agrees: “The appraisal business is dead, and I will be the first to put a tombstone on it.” To expand its business, MMJ formed an affiliated appraiser management company in 2010, but profits are still minimal when compared to pre-recession times, the founders said. Revenue has plummeted from about $1 million a month to “hundreds of thousands a month,” Knobel said, adding he believes other appraisal firms have seen a similar drop.

Headed to trial? When Mueller discovered that her colleagues allegedly were misapplying her electronic signature in October 2009, her reaction was not exactly measured. Her first complaints to the DOS fell flat, documents from agency investigators show. Then, Mueller alerted a bevy of other offices and agencies, the Federal Bureau of Investigation and the office of Gov. Andrew Cuomo, her attorney and MMJ executives confirmed. MMJ and industry sources familiar with the dispute also point out that Mueller took no action until the firm fired her — a year after the alleged misconduct took place. Other sources tell a different story: Mueller became exceedingly angry when MMJ did not (or could no longer) pay her and has pursued the complaint and the lawsuit for revenge. Russ denied that, insisting his client’s motive is about fair compensation. “This is about an honest day’s pay for an honest day’s work,” he said. Mueller is seeking about $800,000 in commissions, attorney fees, late fees from her final check that bounced and punitive damages, according to the complaint. MMJ executives said they stopped payment on the final check after learning Mueller had over-billed jobs and didn’t merit the full amount of $20,688. Before MMJ could issue a check for the correct amount, Mueller sued, Jackson said. In a counter claim filed in 2011, MMJ sought an injunction to prevent Mueller from doing business in Manhattan, citing a noncompete agreement. The injunction was ultimately denied. When asked how he expects the mediation to go, Knobel threw up his hands. “She’ll ask for a million dollars, I will say no and then we will go to trial,” he said.

The new normal The appraisal community is divided over the dispute. Some think MMJ deserves to be punished if it allowed employees to sign Mueller’s name without her knowledge. Others question whether the firm should be the scapegoat for a practice that its competitors — pre-recession — carried out, too. One appraiser is adamant that MMJ, even if held responsible, should not lose its license. “You have to remember this period — anything went,” he said. Leitman Bailey, real estate attorney, predicted MMJ would keep its license. “The administrative judge only looked to whether the conduct occurred and hung the principals after that finding,” he said, when the executives’ “actual knowledge” of the conduct should have been the main consideration. Regardless of the outcome, there’s one thing perhaps all parties can agree on: The future is not very bright for appraisers. Appraisals in New York now net between $600 and $700 each, and the appraiser gets a third to a half of that sum, according to a prominent Manhattan appraiser who asked not to be named. “What are you getting for that price?” he asked. Hardly anything, is what one industry expert thinks. “Meeting a minimal standard is all that matters,” said Larry Sicular, founder of Sicular & Associates, a Manhattan-based brokerage and appraisal firm. MMJ’s founders are resigned to the new normal. “When I get to a stop sign in the middle of the desert, I don’t ask why, I just stop,” Knobel said, describing the post-HVCC appraisal world. “It is what it is.” TRD www.TheRealDeal.com March 2012 00

2/28/13 11:16 PM

Takk Yamaguchi Investment Specialist

100 transactions completed in 2012, Takk Yamaguchi of TOWN has With more than

emerged as Manhattan’s premier specialist in investment leasing of condos, cooperatives and rental buildings. Combining TOWN Residential’s creative, hands-on approach with an unmatched knowledge of Manhattan’s high-end rental market, Takk inked more than $2.5

million in annualized rent last year.

From West Harlem to Wall Street, Takk’s specialty is maximizing rent roll and return rate. With more than 300 lease transactions finalized since 2008, Takk helps owners defray the cost of vacancy while securing credible tenants to ensure on-time payments.

Takk Yamaguchi Representative, Licensed Salesperson 110 Fifth Avenue, New York, NY 10011 tyamaguchi@townrealestate.com (646) 998-7451

If you have a condo, coop, or building with rental inventory to move, contact Takk Yamaguchi at TOWN.

A Selection of 2012 Closings

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Town Residential LLC is a partnership with Thor Equities LLC.

97 Lexington Avenue, 3B

128 East 84th Street, 3B

45 Tudor City Place, 1220

25 Tudor City Place, 1917

250 East 30th Street, 5B

320 East 42nd Street, 2306

330 East 38th Street, 54D

215 East 59th Street, 2F

154 Attorney Street, 101

45 Tudor City Place, 2109

25 Tudor City Place, 322

1240 Lexington Avenue, 31

129 West 69th Street, 2

129 East 39th Street, 4C

45 Tudor City Place, 703

45 Tudor City Place, 1201

355 East 72nd Street, 6D

135 William Street, 2B

301 East 49th Street, 3C

200 East 11th Street, 12A

128 East 84th Street, 3C

25 Tudor City Place, 1209

45 Tudor City Place, 1217

128 East 84th Street, 3D

75 Wall Street, PHD3

225 East 95th Street, 11K

220 East 57th Street, 10G

235 East 40th Street, 39I

1240 Lexington Avenue, 25

128 East 84th Street, 3B

400 Fifth Avenue, 40G

155 East 34th Street, 4C

215 East 59th Street, 2F

235 East 40th Street, 7G

120 South 2nd Street, 6B

250 East 30th Street, 5B

45 Tudor City Place, 1912

31 Union Square West, 6D

220 East 57th Street, 16J

5 Tudor City Place, 517

630 First Avenue, 9M

45 Tudor City Place, 808

151 East 43rd Street, 5B

300 East 40th Street, 25H

154 Attorney Street, 101

1240 Lexington Avenue, 43

215 East 59th Street, 3F

45 Tudor City Place, 1403

Liability

from page 38

funds aren’t easily assessable because they aren’t in the U.S.,” he said. While Fair Housing laws are largely cut and dry on the topic of discrimination, it’s often difficult for board members who aren’t well versed in the ins-and-outs of the law to determine when they can and can’t be sued. And plaintiffs regularly sue individual board members without merit, attorneys said. In a recently filed lawsuit against the condo board members at 88 Greenwich Street, individuals will likely not be held liable, attorneys told TRD. The suit, filed in November, was brought by the residents of the Hurricane Sandy–affected building, which was deemed uninhabitable by the city for over a month after the storm. The residents filed a $35 million suit against the condo board and property manager, as well as five individual board members, alleging that building management took unsatisfactory precautions against flooding. The board members will likely not be held accountable on an individual basis, Fitapelli said, since they appear to have been acting inside the scope of their official duties. Meanwhile, in another ongoing case, individual board

members at 1107 Fifth Avenue are in the crosshairs. In that suit, the estate of one of the building’s former unit owners, Monique Uzielli, is accusing 1107’s board president, Maureen Klinsky, of sabotaging its potential $27.5 million penthouse sale. Five other board members are also named in the suit. The suit, which was filed in October, alleges that Klinsky denied a prospective buyer after her own (lower) offer was rejected by the estate. The estate claims the board made approval contingent on the buyer agreeing to make the apartment’s private wraparound terrace and roof accessible to residents of the entire building. An attorney for the plaintiff was not immediately available for comment. Neither Klinsky nor an attorney for the board immediately responded to requests for comment. Pariser said it’s often hard to prove liability in cases where individual board members are named. “It’s really hard to sue a board member,” he said. “You can sue anybody, but nine times out of 10, individual board members are going to be dismissed.”

Playing it safe It’s relatively easy for co-op boards to err on the side of

caution when it comes to avoiding personal liability, said Roberta Axelrod, a Time Equities executive who serves on 10 co-op boards as part of her job. Axelrod said she recommends that board members have financial criteria and policies that they apply consistently so if there’s a challenge they can present it as evidence. “When boards get into trouble, [it’s often because] it becomes more subjective and therefore harder to prove their logic,” she said. Neil Garfinkel, an attorney and the Real Estate Board of New York’s counsel, advises all boards to educate members on Fair Housing laws. “Co-op boards need to be educated and understand that they have to follow these laws,” he said. “While they have the right to reject, they absolutely cannot reject based on a protected category.” Oved recommends having an agreed-upon reason for rejection amongst the board. “Even though you don’t have to state a reason for rejecting someone, it’s very important that you have a valid reason,” he said. “There should be notes and that reasoning should be put into a file [in case there is future litigation.]” TRD

Gilmartin from page 41 of it. She is very smart in terms of understanding what is attainable and what is not attainable.” Of course, one of the toughest challenges came earlier on in the process. That was convincing reticent tenants to move — a fight the last holdouts took all the way to the state’s highest court, which upheld Forest City’s right to use eminent domain. The leader of the opposition movement, Daniel Goldstein, who founded the anti–Atlantic Yards group Develop Don’t Destroy Brooklyn and became the face of the protesters, was the last to leave. Goldstein described Gilmartin as a formidable foe. “She will do whatever she can to make her company succeed in her projects,” he told TRD last month. “She is cutthroat. I think she probably can be very intimidating to people and that helps in negotiation. It didn’t work on me.” Goldstein recalled meeting with her in his three-bedroom Prospect Heights condo after he and his fellow holdouts had lost a round in court. He was hoping that she wanted to negotiate. Instead, she wanted to buy him out. “She was trying to scare me, threaten us,” he said. Goldstein said the two agreed (at Gilmartin’s request) to keep their discussion confidential. But a few days later, he heard from a friend who lived in Edgemont, the same Westchester town as Gilmartin. Goldstein said the friend’s fourth-grade son was in the same class as one of Gilmartin’s children, and that she mentioned Goldstein during a class presentation. According to Goldstein, the child told his mother that Gilmartin “is building a basketball stadium and housing for poor people, but a mean man named Daniel Goldstein doesn’t want them to do that.” “Here she is talking to fourth graders, and she is so on message,” he added. “She will take whatever opportunity she can to bounce the opposition, whether it’s truthful or not.” Eventually, Forest City Ratner prevailed in court and Goldstein and other holdouts moved, with Goldstein reportedly receiving a $3 million buy-out from Forest City. Though Goldstein didn’t find “anything charming about

her,” he was impressed by Gilmartin’s poise at some of the more contentious public meetings where emotions ran high. “She was pretty calm and does a professional job,” he said.

Steering the ship

As CEO, Gilmartin will be responsible for running Forest City Enterprises’ New York–based, wholly owned subsidiary. And the role of the subsidiary is only likely to grow. In December, the parent company reported that New York City accounted for $149.5 million, or 29.1 percent, of the company’s operating income over the first nine months of 2012. But the parent company is currently engaged in a concerted effort to sell “non-core” assets in “non-core markets.” It’s made it clear that it considers New York a core part of its portfolio. As a result, Gilmartin’s profile is likely to rise and the New York subsidiary could play an increased role in the firm’s overall bottom line. One of the largest tasks, of course, is completing the next phases of the Atlantic Yards project, which entails constructing 15 modular commercial and residential buildings. Critics have attacked Forest City for using the promise of Frank Gehry–designed towers and then switching to the lower-budget modular construction, as well as delaying its time line for building residential units, particularly the affordable housing. The role of overseeing day-to-day construction will remain with Forest City’s Robert Sanna, who will now officially report directly to Gilmartin instead of Ratner. (Up until now, Gilmartin’s role in the project was to oversee issues such as the public approval process, financing and interactions with the public and other partners. Now she will also oversee Sanna’s construction division.) And there is still work to be done. “The arena obviously was a great first moment — I can’t stress to people how difficult that project was from a political and construction standpoint and making that work,”

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said Jed Walentas, a principal at Two Trees Management. “But they still have a huge amount to accomplish in terms of doing the housing and other aspects of the neighborhood. I think they will set a new standard in the area.” One industry insider, however, speculated that though “she was pretty much already running the show there,” Gilmartin may be eager to “make her own imprint” by taking on other projects as well. There is already an opportunity on the horizon that industry sources say Forest City may be planning to pursue. In January, the city issued a request for proposals for the development of Seward Park — a 1.65 million-squarefoot, mixed-use project with 1,000 units of housing along with commercial and public space on the Lower East Side. “I think she is going to go after that,” one source said. “I also think she is going to shepherd through the completion of the modular housing at the Atlantic Yards and I think they are going to expand their reach. For the past three, four or five years, they were bogged down with Atlantic Yards and they really pulled a rabbit out of their hats and passed a major hurdle. Now they are free to expand on other developments in the city.” Few expect the actual culture of Forest City Ratner to change in any dramatic way. “I don’t expect Bruce to disappear,” Walentas said. “I personally don’t think that the change in title will shift the dynamic too much. MaryAnne has probably been running that place on a day-to-day sense for some time.” TRD CORRECTIONS A N D C L A R I F I C AT I O N S In the February issue story, “Not-for-sale by owner,” The Real Deal incorrectly stated that a client of Town Residential’s Dana Power had purchased the apartment of a “prominent billionaire.” In fact, the client did not purchase the apartment. In the February issue story, “Changes for Citi,” The Real Deal mistakenly ran a photo of the Rushmore at 80 Riverside Boulevard in place of the correct image: Silver Towers at 600 West 42nd Street. The Real Deal also incorrectly stated that broker Dina Cohen moved from Citi Habitats to Halstead Property in 2011. She moved firms in February 2012. www.TheRealDeal.com January 2012 00

2/28/13 11:18 PM

BEDROOM 13'-10" x 11'-3"

PRIVATE SUN DECK 1868 SQUARE FEET

LIVING ROOM 14'-10" x 20'-11"

DINING

13'-6" x 14'-10"

UNIT 705 SECOND LEVEL SECOND LEVEL

BEDROOM 8'-10" x 11'-10"

LIVING ROOM 14'-11" x 10'-0"

OPEN TO BELOW

DOUBLE HEIGHT SPACE BEDROOM 8'-7" x 23'-6"

KITCHEN

14'-8" x 13'-1"

BEDROOM 10'-0" x 13'-5"

THIRD LEVEL UNIT 705 THIRD LEVEL

LEVEL UNITFOURTH 705 FOURTH LEVEL

Advertising

from page 16

ing to do,” said Gary Malin, president of Citi Habitats, “is continue along the lines of transparency for consumers, so [consumers] understand who they’re dealing with and how to get in touch with people. The more transparency in our industry, the better.” The increased training could be especially important when it comes to brokers’ personal social media accounts like Facebook and Twitter. That’s because the new rules cover things like social networking sites and blogs. “We’re all kind of asking a rhetorical question,” said Douglas Wagner, the executive leasing director at Bond New York, “which is, ‘If an agent under my supervision goes on to their private Facebook account and promotes their open house and makes some sort of general reference to something that’s not compliant with advertising and licensing laws, how does the brokerage … supervise compliance?’ ” In other words, is a brokerage responsible if a broker touts a condo’s “family-friendly size” on his or her personal Facebook page — a reference that’s forbidden by Fair Housing laws as discriminatory against buyers who don’t have children?

Under the new rules, both brokers and firms (their principal license holders) would be responsible. So it’s in the brokerages’ interests to make sure their brokers are up to speed on the latest guidelines.

Though they now appear inevitable, the changes have not been without controversy. As TRD reported in 2011, REBNY and the New York State Association of Realtors, which represents brokers statewide, differed over several technical points in the proposed rules. For example, REBNY wanted brokerage names to be larger and more prominent on ads, while NYSAR wanted team member names to be larger. The two sides appear to have reached a compromise: If a broker or team name is used in an ad, including business cards, the rules would require that the brokerage name also appear, though not necessarily of equal or greater size. And if a broker or team wants to include their logo, the brokerage’s logo or name has to appear, too, though not necessarily of equal or greater size. Such technical tweaks may be more tedious than any-

thing — and some, such as changing e-mail taglines, are cost-neutral. “I think the agents who are conducting their activities in an already exemplary way, it’s just viewed as extra steps that they have to do,” said Larry Link, president of the brokerage Level Group. The only changes that may rankle, according to brokers, are those associated with renaming “groups” as “teams” as many of those groups have spent years building brands. Still, some say the change would affect upstate groups more than ones in the city, which by and large already market themselves conspicuously under the banner of bigger firms like Douglas Elliman and the Corcoran Group. (Besides, the rules would allow groups to cite their former name alongside their new one for 12 months after the rules go into effect.) “Being part of a large organization like Corcoran is just a benefit and a positive thing,” said Tamir Shemesh, head of the Shemesh Group, which markets itself prominently under the Corcoran umbrella. “[Corcoran] spends a lot of resources and money to maintain its brand, and it’s a good brand. Why not use it?” TRD

mortgage insurance. Even with a 680 credit score, the conventional loan is cheaper by $85 a month — based on FHA’s new fee levels, said Stamets, and those monthly premium payments can be canceled at the 78 percent loan-to-value level, whereas FHA will keep charging them for the life of the mortgage. Steven Maizes, managing director of mortgage banking for Mortgage Capital Partners in Los Angeles, said FHA’s new fees and policies are likely to cost the agency valuable, low-risk business on refinancings. Maizes recently ran a spreadsheet analysis for a client with a $460,000 FHA loan at 5 percent. Even with a 1.5 point

rate reduction, the added fees caused the monthly payment to decrease by just $97. “If you couple that [small saving] with the fact that the mortgage insurance payment can never go away,” he said, refinancing an existing FHA loan for a creditworthy borrower into a new FHA loan will be tough to justify. Bottom line: Homebuyers should make sure their loan officer runs the numbers comparing FHA with privately insured conventional alternatives. They may not want to be saddled indefinitely with higher payments — and no right to cancel. Kenneth Harney is a syndicated real estate columnist.

Saint Thomas Church (1 West 53rd Street)

between 10th and 11th avenues and is the city’s only CroatianAmerican parish. Until 1974, it served a largely Irish-American congregation, including the late Senator Daniel Patrick Moynihan. This summer, Gary Barnett’s Extell Development paid $16.46 million for the church’s 140,000 square feet of air rights, or $118 per square foot. Barnett told TRD in August that he plans to build a 40-plus-story residential tower just to the east of the church at a site on which Extell signed a 99-year ground lease with the estate of the late landlord Sol Goldman.

Size doesn’t matter

Harney from page 32 will cause creditworthy borrowers to avoid FHA and seek out low down-payment alternatives through Fannie Mae and Freddie Mac, using private mortgage insurance. Already, said Stamets, FHA is the more expensive option for many borrowers who have good credit but don’t want to make hefty down payments. With FHA’s new fees, for example, Stamets estimates that an applicant with a 720 FICO score making a 3.5 percent down payment on a $250,000 fixed rate 30-year FHA mortgage will pay $144 more a month than a borrower with the same credit score on a conventional loan of the same amount with a 5 percent down payment and private

Air rights from page 53 Supreme Court decision upheld the state landmarks law and forbade the church from making a $100 million air rights deal with Paris-headquartered developer HRO International, thus ending a long and contentious battle which saw the church lose a large portion of its endowment and congregation. (HRO was planning to erect a 59-story tower at the site of the church’s community center.) Graham said the “church was split right down the middle” on the decision to sell to HRO. He said that the church has not received any viable offers for its air rights this time around, though he estimated they would be worth about $200 per square foot.

Christ Church (520 Park Avenue) Located at the corner of Park and 60th Street, this United Methodist church was built in 1931. In 2005, brothers Arthur and William Lie Zeckendorf agreed to pay a then-record $430 per square foot for roughly 70,000 square feet of the church’s air rights. Prior to the deal, $200 per square foot was considered a premium price for air rights. (The Zeckendorfs also paid the private Grolier Club $7 million for their rights at $430 a square foot in 2006.) Last month as TRD went to press, the transaction with Christ Church was reported to have finally closed after lengthy delays at a much higher $600 per square foot, setting a record and netting the church $40 million. In December 2012, the Zeckendorfs filed a building permit for a skinny 51-story, 30-unit condo tower at 43 East 60th Street designed by Robert A.M. Stern, the architect who designed their 15 Central Park West. 102 March 2013 www.TheRealDeal.com

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In 2007, megadeveloper Hines bought a development site at 53 West 53rd Street from the Museum of Modern Art for $125.5 million. Roughly two years later, nearby Saint Thomas — which is located between Fifth and Sixth avenues and was completed in 1914 — sold Hines an additional 275,000 square feet of air rights for the construction of the so-called MoMA tower at 53 West 53rd Street. The air rights went for roughly $22 million, or a rate of $80 per square foot — unusually low for the area. Hines also purchased 136,000 square feet of air rights for the project from the University Club down the block for $10.88 million, also at $80 per square foot. Neighborhood residents attacked the church’s decision to sell, saying that the 1,050-foot planned tower, to be designed by Pritzker Prize–winning architect Jean Nouvel, was out of character with the area and would block views. But Michael Sillerman — a partner at the law firm Kramer Levin Naftalis & Frankel who was involved in the transaction — noted that “we don’t really have an effective mechanism to allow individual landmarks to get the benefits of their unused air rights.” Due to a lack of financing, the project — which is expected to include a hotel, luxury condos and galleries — has yet to break ground.

Church of Saints Cyril & Methodius and St. Raphael (502 West 41st Street) This Hell’s Kitchen church was built in 1902 and is located

Islamic Cultural Center of New York (1711 Third Avenue) Located between East 96th and 97th streets, the Islamic Cultural Center was designed by Skidmore, Owings & Merrill and completed in 1991 for $14 million. In 2004, the mosque issued a 99-year lease to the Related Companies and also sold the developer its 524,250 square feet of air rights. Related used the rights to build One Carnegie Hill, a 41-story luxury tower with 479 rental and cond-op units. (The developer also built a 63,000-square-foot community center for the cultural center in the new building as part of the deal.) Related qualified to purchase the air rights because it owned the neighboring 522-unit rental tower the Monterey, which it put on the market in January, hoping to get between $250 million and $300 million. Representatives from the Islamic center and Related did not respond to a request for comment. TRD www.TheRealDeal.com January 2012 00

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Powerful women

from page 43

Melissa Pianko

executive vice president of development, Gotham Organization

elissa Pianko is spearheading the Gotham Organization’s four-building Gotham West rental project on the Far West Side, which is reportedly the largest-ever affordable housing project undertaken in New York City by a private developer. When completed, the $520 million, 1,240-unit complex, which is slated to begin leasing this summer, will span almost an entire city block — from 10th to 11th avenues, between West 44th and West 45th streets. Pianko has overseen Gotham West since it was a “piece of dirt,” starting with securing a $530 million construction loan from Wells Fargo at a time when “no one was lending any money for anything in New York,” she recalled. Pianko, who has an M.B.A. from Stanford University, started her career as an analyst at Goldman Sachs, first in municipal finance and then in real estate investment banking. But Pianko, who had taken architecture courses in college, found that she really wanted to be on the developer’s side of the table. David Picket, Gotham’s president, said he hired Pianko as a junior “numbers person” in 2005. Her rise through the company’s ranks since then is largely the result of her own initiative, he said, noting that she asked to be the point person on the Gotham West project. At the time, the project was not at the top of the firm’s priority list. “It might have fallen between the cracks if it wasn’t for her persistence,” Picket said. Pianko is “a force of nature,” he added. “She’s an unbelievable multitasker. She’s very good at the empirical skills, the analytical skills and the people skills. She’s the total package.” For her part, Pianko said she loves development because “every step along the way is different. “With Gotham West, [I got to] dip my toe in the pond with all sorts of different things,” she said, including the design issues involved in building what she describes as a “little city,” and the “many layers of [city] regulations” that affect a project of such a large scale.

Leslie Wohlman Himmel

managing partner, Himmel + Meringoff Properties

eslie Wohlman Himmel is the cofounder of real estate investment firm Himmel + Meringoff Properties, which owns more than 2 million square feet of commercial real estate in the New York City area valued at more than $500 million. Himmel and longtime business partner Stephen Mer-

ingoff started the company in 1985. Himmel said the two met in a class at New York University on a day when late real estate titan Harry Helmsley was a guest speaker. In what was perhaps a sign of the times, when Himmel asked Helmsley what his greatest accomplishment was, he replied: “What are you doing later tonight?” Nonetheless, Meringoff was impressed by Himmel’s moxie, and the two became business partners a short time later. Himmel + Meringoff owns about 20 buildings in Manhattan, including the 170,000-square-foot office building 729 Seventh Avenue and the 97,000-square-foot 411 Lafayette Street. Himmel focuses on finding financing and acquisition opportunities for the company, while Meringoff manages leasing, construction and renovation. But Himmel said when it comes to negotiating the purchase of a new building, financing purchase contracts and any legal aspects, she and Meringoff always work together. Recently, the two sold the 108,000-square-foot office building 158 West 27th Street for a reported $57.5 million — more than double the $25 million they paid for it in 2010. However, Himmel said they are generally “reluctant sellers,” and prefer to hold onto their properties more longterm. In the 28 years since Himmel and Meringoff have been partners, the two “have never had a harsh word,” Meringoff said. “She’s absolutely the best partner you can have.”

they were impressed with her. While their initial instinct was to not hire outside the family, he said, “for us, chemistry is a big thing, and we saw chemistry with her early on.” Bragg’s responsibilities at the firm have grown over time. Initially, she said, she worked on the equity and fundraising side, but now she’s negotiating the financing of major acquisitions such as Crown’s recent deal to purchase a 49.9 percent stake in the Olympic Tower complex, a group of four buildings on Fifth Avenue reportedly valued at $1 billion. Bragg played an “invaluable role” in getting the deal done, Chera said.

Raizy Haas

senior vice president of project management and development, Extell Development

p-and-coming development executive Brittany Bragg, 30, was hired as COO at Crown Acquisitions three years ago. The young executive had previously worked as Acadia Realty Trust’s director of acquisitions, where she said she found “phenomenal mentors” in Acadia’s CEO Kenneth Bernstein and executive vice president Joel Braun. Like many real estate development firms in New York, Crown is a male-dominated, family-owned business, headed by founder Stanley Chera and his three sons. Sometimes it’s just “me and 50- and 60-year-old guys having scotch and cigars,” said Bragg, who is the only nonfamily executive at the 32-person company. But she said it’s a credit to the Cheras that they were willing to take a chance on an outsider. “There aren’t a lot of third-generation family businesses that take in a twentysomething-year-old woman and value what they can bring,” she said. Crown’s managing principal, Haim Chera, said the family worked with Bragg on a transaction while she was at Acadia. Although the deal never went through, Chera said,

xtell Development is currently one of the most active development firms in New York City, and sources said Haas is instrumental to operations at the firm, spearheading high-profile projects such as new construction condos the Lucida, the Orion, Altair (both 18 and 20) and Ariel (both East and West). Up until the mid-2000s, in fact, Haas oversaw all of Extell’s day-to-day development work, according to attorney Paul Selver of the law firm Kramer Levin Naftalis & Frankel, who frequently works with Extell. Haas is “easily one of the smartest people I work with,” Selver said. Haas could not be reached for comment, but Extell spokesperson George Arzt told TRD that she led Extell’s $750 million 34-story, 748,000-square-foot International Gem Tower project from start to finish. Of all of Haas’s projects, “Gem Tower stands out because it was a very insular [deal], and there were a lot of challenges getting the city, state and federal government involved,” Arzt said. Reportedly raised in a Hasidic community in Borough Park, Brooklyn — where she still lives with her husband and children — Haas was hired as a property manager in the Diamond District after graduating from high school. That’s where she met Extell founder Gary Barnett, who worked in the diamond business himself before transitioning into real estate. He was impressed with her knowledge of real estate and hired her in 1998. Michele Kleier of residential brokerage firm Kleier Residential has worked with Haas while marketing apartments at Extell projects like the Lucida. “[Extell’s] very fortunate to have her,” Kleier said. “She gets very involved and comes up with good ideas and strategies. There’s nobody in development I’d rather have lunch with than Raizy.” TRD

“We totally think micro-units can be interspersed with regular units in a building,” said developer Jonathan Rose, whose eponymous firm submitted a bid for a 60-unit development to the contest. Mostly, though, developers, including Rose, spoke of microunits in terms of standalone developments — if the city ever changes its zoning regulations to allow them. Perhaps the surest sign of private developers’ interest in building micro-units was the sheer response to the city’s design contest: A stunning 33 teams submitted proposals — the most the city’s Department of Housing Preservation and Development has ever received for a request for proposals. (The Museum of the City of New York is currently showcasing many of the proposals at an exhibit called “Making Room: New Models for Housing New Yorkers.”)

While the city has no plans to relax the zoning restrictions, the real estate industry is watching closely to see how quickly the Monadnock team leases 335 East 27th Street. Right now, the only precedent for micro-units is those apartments that predate the city’s 400-square-foot requirement, which went into effect in 1987 — in addition to what one developer termed “the black market” of Craigslist, mostly illegally chopped up, larger units. “People are living in them today,” said Abby Hamlin, president of Hamlin Ventures, whose firm was part of a team that proposed an 80-unit building called Tandem. “You can’t build them today, but there are existing units in our housing stock that are under 400 square feet, and the market has shown that there’s demand for those,” Hamlin said. “In fact, there’s more demand than there is supply.” TRD

Brittany Bragg

COO, Crown Acquisitions

Micro-units from page 57 $1,564 to $2,663 in January, according to data from appraisal firm Miller Samuel. But what makes micro-units feasible to build, developers say, is the per-square-foot income: $76.72 for a micro-unit versus $55.64 for a studio, in the case of Durst’s analysis. Plus, construction costs are similar for building micro-units as they are for standard studios and one-bedrooms: about $200 (or just slightly more) per square foot, depending on the location, experts say. “I think it’s fairly negligible as far as the hard costs of building because the micro-unit is so much more intensive per square foot than even your typical small studio,” said Nicholas Lembo, president of Monadnock Development, part of the winning bid. Some developers said they believed sprinkling micro-units throughout regular apartment buildings was also workable. 104 March 2013 www.TheRealDeal.com

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MAR C H 1–3

The Historic Districts Council hosts a conference entitled “Preservation Now! Today’s Victories, Losses and Ongoing Battles.” The keynote address will be given by Clement Alexander Price, professor of history at Rutgers University and director of the Rutgers Institute on Ethnicity, Culture and the Modern Experience. Panel discussions will include: “Preservation Campaigns in the Public Sector” and “Preservation Campaigns and Neighborhoods.” The fi nal day of the conference features walking tours of neighborhoods throughout New York City. Reservations required. March 1: Fashion Institute of Technology, West 27th Street and Seventh Avenue. 6 to 9 p.m. Fee: $35; $30 for Friends of HDC, seniors and students. March 2: New York Law School, 185 West Broadway. 8:30 a.m. to 1 p.m. Fee: $35; $25 for Friends of HDC and seniors; free for students. March 3: Meeting times and locations for walking tours will be provided upon registration. Information and registration: www.hdc.org.

C A L E NDA R 1

2 3 4 5 6

The New York chapter of Professional Women in Construction hosts “Meet the Construction Chiefs.” Speakers will include Wally Caban, assistant chief engineer of construction at the Port Authority of New York and New Jersey, and others to be announced. Club 101, 101 Park Avenue. 5:30 to 8 p.m. Fee: $85 for members, $95 for nonmembers. Information and registration: www.pwcusa.org.

8 9 10

12 13 14 15 16 17

The Urban Land Institute presents “ULI New York: East Midtown Rezoning,” a panel discussion examining the value and impact of the proposed rezoning strategy, potential challenges for developers and potential effects on Midtown’s infrastructure, residents and businesses. Panelists will include Laurie Beckelman, president and founding partner of Beckelman+Capalino; Dan Biederman, president of the Bryant Park Corporation; Vishaan Chakrabarti, associate professor of real estate development and director of the Center for Urban Real Estate at Columbia University’s Graduate School of Architecture, Planning and Preservation; Steven Durels, director of leasing and real property at SL Green Realty; New York City council member Daniel Garodnick; Hugh Hardy of H3 Hardy Collaboration Architecture; and Mary Ann Tighe, CEO of the New York Tri-State Region at CBRE. Alexander Garvin, president and CEO of AGA Public Realm Strategists, will serve as the moderator. Sherman & Sterling, 599 Lexington Avenue. 7:30 to 10 a.m. Fee: $65 for members, $90 for nonmembers. Information and registration: www.newyork.uli.org.

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The Real Estate Lenders Association presents a “RELA NYC Breakfast” with guest speaker Pamela Liebman, president and CEO of the Corcoran Group. The Yale Club, 50 Vanderbilt Avenue. 8 to 9:30 a.m. Fee: Free for members, $50 for nonmembers. Information and registration: www.rela.org.

The Development, Design and Construction Committee of the Hellenic-American Chamber of Commerce presents a panel discussion entitled, “American Metropolis: The Future.” Panelists will include John Catsimatidis, the owner and CEO of the Red Apple Group and Gristedes; Edward Minskoff, president of Minskoff Equities; Julie Menin, former chairperson of Community Board 1 in Lower Manhattan; and Kenneth Knuckles, vice chair of the New York City Planning Commission. Louis Katsos, president of Jekmar Associates and assistant professor at the Irwin S. Chanin School of Architecture, will moderate the discussion. Cooper Union, 7 East 7th Street. 7 to 9:30 p.m. Free. Information and registration: cooper.edu.

108 March 2013 www.TheRealDeal.com

The Association of Real Estate Women hosts a luncheon with guest speaker Gary Barnett, president of Extell Development Company. Club 101, 101 Park Avenue. 11:30 a.m. to 1 p.m. Fee: $25 for members, $35 for nonmembers. Information and registration: www.arew.org.

The Metropolitan New York chapter of the Appraisal Institute hosts a chapter luncheon meeting with guest speaker David Cheikin, vice president of leasing at Brookfield Properties. Club 101, 101 Park Avenue. 11:30 a.m. to 2 p.m. Fee: $120. Information and registration: www.aimetrony.com.

The Institute of Real Estate Management presents its annual asset and property management conference: “Building Operations Symposium.” The conference will focus on the rapidly changing role of the property manager and how it impacts everyone in the building and asset management food chain. Jeffrey Brodsky, president of Related Management Company, will give the keynote address. Other speakers will include Linda Aronson, managing director at Jones Lang LaSalle; Jason Black, director of sustainability at SL Green Realty; and Craig Tagen, managing director and the head of asset management for Clarion Partners. McGraw-Hill Conference Center, 1221 Avenue of the Americas. 7:30 a.m. to 5 p.m. Fee: $145 in advance, $349 at the door. Information and registration: www.iremams.com. www.TheRealDeal.com August 2006 00

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