The Real Deal May 2014

20

New questions after Moreland inquiry

26

Frustrated buyers halt their searches

www.TheRealDeal.com

44

Hochfelder back in biz after prison

50

The sleazy side of commercial deals

N ew York R eal E state N ews

68

Your ICSC party preview

Vol. 12 No. 5 May 2014 $3.00

NYC’s super firms

TRD’s annual ranking of

the top residential brokerages — from the biggest firms to the best boutiques p34

WTC’s retail lineup revealed

When will NYC’s market top out?

One57, behind the glass curtain

An exclusive list of tenants slated for the country’s most high-profile shopping destination p60

A breakdown of the key trends that will determine if the residential market will continue to boom — or go bust p72

A sneak peak at inner workings of the city’s most buzzed-about condo tower, from staff salaries to $4,000-a-foot storage bins p48

3% B R O K E R C O M M IS SI O N

An LA State of Mind

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LITTLE NELL • ASPEN, CO

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150 East 58th Street . Penthouse . New York, NY 10155 212.213.4444 . www.aacrealty.com

ASHKENAZY

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THE SHOPS AT THE BRAVERN • BELLEVUE, WA

UNION STATION • WASHINGTON, D.C.

ACQUISITION

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LITTLE NELL • ASPEN, CO

25 EAST OAK • CHICAGO, IL

OLD SPITALFIELDS MARKET • LONDON, UK

RIVERCENTER MALL • SAN ANTONIO, TX

635 MADISON AVE NEW YORK, NY

ONE UNION SQUARE SAN FRANCISCO, CA

HARBORPLACE • BALTIMORE, MD

FANEUIL HALL MARKETPLACE • BOSTON, MA

Please Join Us for a Cocktail Hour • Monday, May 19, 2014, 4-6pm • Booth N359U • RSVP to leasing@aacrealty.com

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Contents M AY 2 0 1 4

INSIDE OUT

more Moreland 20 No Will developers get a pass

22

now that the state panel probing their controversial tax breaks is gone?

22

The Bronx is smoldering The borough may be the next in line to take off as investment interest there rises.

24

Richard Steinberg: Broker or feng shui master?

The top-producing Warburg agent (and former podiatrist) talks about how the “chi” helps him close deals.

Warburg Realty’s Richard Steinberg

Want to know what goes on at the New School? Passersby need only glance at the institution’s new University Center in Greenwich Village to understand that progressive design education happens here. The building by Skidmore, Owings & Merrill expresses the school’s interdisciplinary approach through a brass-shingled facade crisscrossed by a series of glass-enclosed stairways that highlight a vivid tableau of students circulating within. The unique system encourages collaboration—and a new dialogue between campus and community that is sure to be conversation for decades to come.

Transforming design into reality

28

In their words...

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

Pershing Square Capital’s Bill Ackman

30

Ackman’s latest conquests The hedge fund chief ’s recent real estate investments are drawing new industry attention.

Fannie-Freddie fee fallout 32 The The mortgage giants are charging

32

recession-era fees to borrowers while raking in billions.

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

buyouts get bigger 32 Sandy A state program to buy back stormA Staten Island home damaged by Sandy

damaged Staten Island homes is expanding its reach.

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

34

It’s a bird, it’s a plane...

No, it’s a super firm. TRD’s annual ranking of the top residential brokerages in the city — from the biggest firms to the best boutiques.

Architect: Skidmore, Owings & Merrill Photograph: Tex Jernigan

NYC’s top firms: Who made the cut this year?

8 May 20142012 www.TheRealDeal.com October www.TheRealDeal.com

www.TheRealDeal.com March 2012 00

RECENT TRANSACTIONS S ince 2005, we have invested $1.7 billion in the origination and acquisition of commercial mortgage loans collateralized by multifamily, retail, office and light industrial properties throughout the United States.

$52,000,000

$23,500,000

$16,100,000

Note Acquisition Multifamily Manhattan, NY February 2014

Loan Origination Development Site Brooklyn, NY April 2014

Distressed Note Portfolio Acquisition Multifamily Properties Brooklyn, NY January 2014

$13,000,000

$11,740,00

$10,000,000

Loan Origination Townhouse Manhattan, NY April 2014

Loan Origination Townhouse Manhattan, NY January 2014

Loan Origination Medical Office Manhattan, NY February 2014

$8,600,000

$5,400,000

$5,100,000

Loan Origination Multifamily Property Manhattan, NY April 2014

Loan Origination Residential Development Hamptons, NY February 2014

Distressed Note Portfolio Acquisition Multifamily Properties Queens & Bronx, NY March 2014

825 Third Avenue • 37th Floor • New York, NY 10022

(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.

Contents continued of jail, back in real estate 44 Out Adam Hochfelder has quietly

NEW TWIST

44

become a principal at a hospitality firm and re-entered the industry.

46

Speaker still a wild card After months, the industry is still figuring out City Council head Melissa Mark-Viverito.

48

Adam Hochfelder

The big reveal 48 One57: The deals, budget and revenue at the city’s most-talked-about tower.

underbelly of the biz 50 The The gray areas of the commercial industry, from gaming sellers to secretly flipping contracts.

Gary Barnett’s One57

60

The WTC retail blitz A behind-the-scenes look at how the country’s highest-profile mall is feverishly trying to lock in stores.

72

The new ideas that poured into Lower Manhattan’s rebuilding resulted in a stronger infrastructure—and some architectural gems. A key piece in the undertaking is Pelli Clarke Pelli’s new Pavilion at Brookfield Place, a public space serving the 35,000 commuters who use the PATH system daily. Because the system’s track network runs underneath, the pavilion’s soaring roof and hanging glass curtain wall could only be supported at two points. Thornton Tomasetti met the challenge with a pair of 54-foot-tall “basket” columns, each gathering its loads in an expressive weave of lightweight, brightly painted twisting steel tubing that spirals down to plaza level in an ever-tightening array. It is innovative design, with a twist.

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

Commercial Market Report

Red light, green light 1-2-3

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

The key signals the industry is watching to see whether the residential market is headed for doom — or continued boom.

26

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

92

National Market Report

76

Reports from around the country on significant developments and trends.

5Pointz, the developers side

97

The Deal Sheet

Wolkoffs defend painting their graffiticovered buildings and talk about their planned project for the famed site.

David (left) and Jerry Wolkoff Tommy Hilfiger

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

18

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

116

Development Updates

136

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

Hilfiger’s hotel tip

118

Residential Deals

A chance Art Basel run-in with a NYC broker leads to a hotel buy.

An insiders’ look at how home sales really happen.

130

Calendar of Events Check out this month’s activities.

Architect: Pelli Clarke Pelli Architects Structural Engineer: Thornton Tomasetti Photograph: Tex Jernigan

10 May October 20142012 www.TheRealDeal.com www.TheRealDeal.com

A deal junkie 138 Winick: Jeff Winick on shedding 55 pounds, his Rolex collection and dating.

136

We Heard A lighter look at industry buzz.

www.TheRealDeal.com March 2012 00

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The Real Deal N e w Yo r k R e a l E s tat e N e w s Publisher Amir Korangy Editor-IN-CHIEF Stuart W. Elliott Managing Editor Jill Noonan DEPUTY Managing Editor Eileen AJ Connelly EXECUTIVE Web Editor John Goff

Whether you need to buy or sell a building having a real estate broker that knows the local players is key - the buyers and the sellers. You need an intensely dedicated broker who is still on the job long after the lights have gone out elsewhere.

You need Rosewood Realty Group

Art Directors Ronald Gross, Keziah Makoundou Senior ReporterS Adam Pincus, Katherine Clarke Reporter Hiten Samtani SOUTH FLORIDA BUREAU CHIEF Eric Kalis Contributors C. J. Hughes, David Jones, Adam Piore EDITORIAL OPERATIONS MANAGER Linden Lim Web Producers Mark Maurer, Julie Strickland, Zachary Kussin, Angela Hunt SOCIAL MEDIA COORDINATOR Kerry Barger Editorial Assistant Sasha von Oldershausen

212.359.9900

www.rosewoodrealtygroup.com

Rosewood Knows New York

We are pleased to announce the following results for the year-to-date April 25th 2014, Rosewood has completed total sales of

$807,169,000 which include:

Manhattan: Aggregate sales of

$249,293,000

23 Buildings / 707 Residential Units / 27 Commercial Units Brooklyn: Aggregate sales of

$157,080,000

22 Buildings / 1,101 Residential Units / 5 Commercial Units Bronx: Aggregate sales of

$176,166,000

34 Buildings / 1,542 Residential Units / 38 Commercial Units Queens: Aggregate sales of

$224,630,000

18 Buildings / 1,269 Residential Units / 10 Commercial Units

© Copyright 2012 Rosewood Realty Group. All rights reserved.

12 May 2014 www.TheRealDeal.com

Interns Juan Zielaskowski, Inga Ryabchikova Photographers Chris Martin, Marc Scrivo Director of mARKETING OPERATIONS Yoav Barilan ASSOCIATE SALES DIRECTOR Ross Fox Advertising Sales Eran Evron, Abi Laoshe, Nick Mascaro, Robert Stearns, Nicki Chadi, Sigalit Levi, Marcus Guest, Chris Cuomo DIGITAL TRAFFic MANAGER Junaid Zahid WebmasterS Nima Negahban, Andrew LoCascio Finance director Kenneth Cyrus OFFICE MANAGER Virginia Durso Circulation Paul Destanko Distribution Mitchell Newman, Patricia Hofmann, Forero Express 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 © 2014. Call 212-2601332 or e-mail news@therealdeal.com. Warning: It is illegal to photocopy or reproduce any part of The Real Deal without express written consent. For reprints and duplication rights, call 212-260-1332.

Principal office: 158 West 29th St., New York, NY 10001. The Real Deal is published monthly. Annual subscriptions cost $95. Send check or money order to 158 West 29th St., New York, NY 10001.

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EDITOR’S NOTE

maxed out micro-units

A

Our transient times

s blasphemous as it might be to write in a real estate magazine, it hardly seems like people even need homes anymore.

In the era of cloud storage and the “share economy,” it’s almost like you

could walk around with just the clothes on your back and be fine — at least if you live in New York and have a little bit of money to your name.

These days you can be a millionaire, but live with the freedom of a transient.

Think about it. What sort of stuff do you need to put in a house these days?

Forget desktops, even laptops — today most of us could plan our weekends, do all our work and even engineer a satellite launch from the phone in our pockets. You don’t need a car, or a garage to store it — just sign up for a Zipcar — or better yet, hop on a Citi Bike. You can do all your shopping through Amazon Prime and have it delivered to your office (like I do).

Your office can be a shared space, for a month or even a day, provided by a company like WeWork or Regus. And to rest your head for the night, you can rent an apartment through Airbnb, the website currently locked in a battle with the hotel industry. And for a mid-day nap (or something more illicit), there are new companies (like Breather) that have apartments available for rent by the hour.

Photos: Dooley Images

New Yorkers have, of course, always led the way in terms of on-the-go trends, from taxis to take-out.

So with the budding share economy and the rent-don’t-buy fad, it might seem plausible that there would be a trend toward people needing less space and smaller apartments.

But the exact opposite seems to be true in the residential market. In our annual ranking of Manhattan’s top brokerages, our cover story this month, we found that most firms have been thriving off of selling large, not small, apartments.

With the budding ‘share economy,’ it might seem plausible that there would be a trend toward people downsizing, but the opposite seems to be true in the Manhattan residential market.

That’s because these are the days of the New York City mega-apartment, with developers largely building super-luxury units for families and foreigners.

As a share of all Manhattan sales, four-bedroom-plus apartment transactions rose significantly in 2014’s first quarter compared to the same time the year before, according to appraisal firm Miller Samuel. And the average sales price for apartments overall jumped 31 percent year-over-year, an astronomical rise.

All this was good news for residential brokerages, whose listings we tallied starting on page 34.

While Manhattan’s 12 biggest firms had fewer listings overall, the listings they had were a lot pricier. Overall, the top 12 firms had a total of $12.7 billion in exclusive Manhattan sales listings, up about 52 percent from $8.5 billion in 2013.

Elsewhere in the issue, we’ve got plenty of coverage that ties in with this month’s massive ICSC retail conference in Las Vegas, which draws many industry pros from

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We take a look at the top-grossing retail buildings in Manhattan (page 64), examine which tenants are taking store space in the World Trade Center (page 60) and sit down with retail guru Jeff Winick, who talked about his collection of Rolexes and being an inveterate deal junkie, in “The Closing” (see page 138).

We also take an inside look at Manhattan’s most talked-about new condo, One57, (page 48), and profile investor Adam Hochfelder, who famously crashed and burned during the last real estate boom and wound up in prison. Since his 2012 release, he’s quietly rejoined the real estate game (page 44).

Finally, don’t miss TRD’s New Development Showcase on May 15 at the Altman Building in Chelsea. Over 2,000 real estate enthusiasts are expected to attend and view the 30-plus new development sales booths and models from New York City and Miami. Get more details at TheRealDeal.com/Forum.

Enjoy the issue!

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Commercial Ma r k e t

Large blocks hit market in Midtown South

Former Ring building one of a flurry of spaces listed amid tight leasing climate

By Adam Pincus The office-leasing market in Manhattan remained strong last month, with the average asking rents rising in all submarkets, even as the availability rate ticked up in Midtown South as landlords made several large blocks available, including the Kaufman Organization listing the first of four former F.M. Ring Associates properties.

“Overall it is very active,” said Joseph Harbert, president of the Eastern Region for commercial firm Colliers International. “Large tenants are out there in force.

Prices for Midtown South are heading to new highs unforeseen even a year ago.

[And] Sixth Avenue is starting to absorb the blocks that we were all concerned about a short six months ago.”

Even so, not all the areas were equal, he noted: “Grand Central is lagging a bit.”

The average asking rent in Manhattan rose by $1 last month to $64.59 per square foot compared with March, while the availability rate fell by 0.1 points to 11.3 percent, figures from Colliers showed.

Midtown A large block of space hit the Midtown market in the iconic Chrysler Building last month, according to information from leasing database CoStar Group.

The building, at 405 Lexington Avenue between 42nd and 43rd streets, is owned by landlord Tishman Speyer. The block of floors from the seventh through the 10th was listed as available, with a total of 145,813 square feet, CoStar figures showed.

There was no asking rent listed on CoStar, but a nearby floor in the building had an asking rent of $62 per foot, below the Midtown average.

The average asking rent in Midtown continued its steady rise last month, increasing by 91 cents per foot to $74.40 per foot in April, compared with $73.49 per foot in March, Colliers data showed. The availability rate declined by 0.2 points to 11.6 percent.

Midtown South A flurry of large blocks of space hit the tight Midtown South office market last month, especially near the Flatiron District, CoStar data revealed.

One of the most highly anticipated was the former F.M. Ring Associates building at 119 West 24th Street, which Extell Development purchased last year and then earlier this year net leased to the landlord

Manhattan office stats AVAILABILITY RATE

AVG. ASKING RENT

Apr ’14 Mar ’14

Manhattan 11.3% $64.59 11.4% $63.59

Apr ’14 Mar ’14

Midtown 11.6% $74.40 11.8% $73.49

Apr ’14 Mar ’14

Midtown South 9.2% $56.15 8.8% $55.53

Apr ’14 Mar ’14

Downtown 13.8% $50.99 14.4% $50.25

Source: Colliers International

Kaufman Organization.

The 14-building Ring portfolio was kept mostly vacant for years, with brokers griping that they could lease tenants at the locations if only ownership would strike a deal, before Gary Barnett’s Extell won control.

Now, with four of the properties controlled

by Kaufman, they have their first chance.

The entire 12-story building is vacant and will have about 130,000 square foot of office space available around August, said Grant Greenspan, a principal and head of leasing with Kaufman. The asking rent is $65 per square foot.

Kaufman is looking for one or two large tenants to anchor the building with about 50,000 to 70,000 square feet — one will win naming rights and its own lobby and elevator. Kaufman plans to lease up the balance of the building with full-floor tenants, Greenspan said.

“We sent an email blast [in mid-April], and the response was enormous,” Greenspan said. He said his building will likely have a slight price advantage over other larger properties with sizeable listings on Park Avenue South and nearby.

For example, TF Cornerstone’s 387 Park Avenue South added more than 98,000 square feet to the market last month in the 218,000 square foot building at 27th Street.

There the asking rent is in the “high $60s” in the upper floors, said leasing broker Matt Leon, an agent for the property and an executive managing director at Newmark Grubb Knight Frank.

The building has a roof deck and the Continued on page 126

AUCTION JUNE 19th

Connecticut & Massachusetts

247,000+ Sq Ft Multi-Use Building on I-91 1175 State St, New Haven, CT

New Haven, CT

• $160,000+ Net Income at 15% Occupancy • Tremendous Upside Potential • $1,800,000 Opening Bid

12+ Acre Redevelopment Site on Main Thoroughfare 2418 Main St, Rocky Hill, CT • Only 1 Mile from I-91 & Directly Across from CVS • $1,650,000 Opening Bid

Rocky Hill, CT

Probe into developers’ tax breaks in limbo U.S. Attorney may take harder line on developers after Cuomo commission disbanded mid-probe

By Hiten Samtani ust nine months after creating the Commission to Investigate Public Corruption, which was probing controversial tax abatements given to five of the city’s top real estate developers, Gov. Andrew Cuomo disbanded it last month, leaving questions about the future of the inquiry.

Commonly known as the Moreland Commission, the panel was looking into whether the five developers — Silverstein Properties, Thor Equities, Extell Develop-

J

campaign on Jan. 28, 2013, the same day that a bill passed allowing the tax breaks, which are typically reserved for affordable housing projects but were somehow applied to Extell’s ultra-glitzy One57. Three weeks later, Extell donated a similar sum to a state Democratic Party account that paid for some of Cuomo’s advertisements.

Fisher Brothers was being investigated for an abatement it received at 86 Trinity Place, while Friedman was under scrutiny for its building at 113 Nassau Street. The Silverstein probe involved its Four Seasons

689,000+ Sq Ft Industrial Complex

165 Front St, Chicopee, MA

Chicopee, MA

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Favorable Financing Available • 2% Broker Participation

516.349.7022 • www.MaltzAuctions.com David R. Maltz & Co., Inc., Licensed CT Real Estate Brokers • Sold in Conjunction with JJ Manning, Licensed MA Real Estate Brokers & Auctioneers, MA Auc Lic #3184

The Moreland Commission was looking into the possibility that campaign contributions were tied to tax abatements for luxury buildings, including Friedman Management’s 113 Nassau Street, left. Thor Equities, led by Joe Sitt, center, and Fisher Brothers, led by Arnold Fisher, right, were also named in the probe.

N O R T H M A R Q C A P I TA L IS PLE ASED TO ANNOUNCE

Keith Braddish has joined our New York City office as Senior Vice President/Managing Director

NEW YORK CITY OFFICE 212.904.1994 20 May 2014 www.TheRealDeal.com

northmarq.com

ment, Fisher Brothers and Friedman Management — received 421-a tax abatements on high-profile luxury projects because of their political contributions.

With the panel dissolved, the investigation is now in limbo. “The Moreland Commission had clearly identified smoke visà-vis REBNY campaign contributions and 421-a abatements,” said Jesse Laymon, executive director of good-government group EffectiveNY. “But they were shut down before they could identify the existing fire.”

Any future for the probe now appears to lie with Preet Bharara, the United States attorney in Manhattan and a respected crusader against corruption. Two weeks after Cuomo shut down the commission, Bharara sharply criticized the governor’s decision and moved to take possession of the investigation’s case files.

“Will the U.S. Attorney, who unlike Cuomo isn’t beholden to state officials, pick up where Moreland left off?” Laymon asked.

A spokesperson for the Bharara’s office declined to comment. Representatives for the developers did not respond to requests for comment.

The Moreland Commission was tasked with investigating questionable political donations from the developers. For example, associates of Gary Barnett’s Extell donated $100,000 to Cuomo’s re-election

tower project at 30 Park Place and Thor its 516 Fifth Avenue project.

“The idea that a super-luxury building has a tax abatement is beyond me,” said one real estate insider. “It’s a complete misallocation of resources.”

The commission subpoenaed extensive information from the developers in August, including communications with lobbyists and elected officials. It followed with a December report in which it stated that it was clear that “the combination of very large campaign contributions and very narrowly targeted benefits to those same [real estate] donors creates an appearance of impropriety that undermines public trust in our elected representatives.”

The report stressed, however, that the investigation was ongoing, and didn’t draw any conclusions on whether the 421a abatements the developers received involved any “improper action.”

Susan Lerner, the executive director of advocacy group Common Cause New York, said it was “hard to imagine” a better place for the investigation to land.

“If I were one of the real estate firms that had been the subject of the subpoena, I don’t think I’d breathe a sigh of relief,” she said, “because an even stronger investigative body has picked up the file.” TRD www.TheRealDeal.com March 2010

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By the Numbers

$895 million Amount invested in Bronx real

estate and development in 2013, two-thirds of which went toward residential development. That’s a nearly 33 percent increase from the $674 million invested in 2010.

Next stop for investors: the Bronx

With prices rising throughout the rest of New York City, land availability and crime drop spur interest from developers

C

ould the birthplace of hip-hop be the next real estate hot spot in the city? With the recession in the rearview, ever more confident New York City developers and real estate investors are scouring the five boroughs for the next up-and-coming locales. And the Bronx is more often on the radar. Crime is down by more than 70 percent since the crack-riddled 1990s, and developers like Signature Urban Properties, Omni Development and Equity One are ramping up projects.

To be sure, not all is hunky-dory in the borough.

Unemployment is still high, average incomes are still low and infrastructure needs are great. But for many, that signals opportunity. “Keep your eyes on the Bronx — that’s the next borough. They’re ready for it,” Louis Coletti, CEO of the Building Trades Employers’ Association, recently told The Real Deal. “They have land available, and that’s the primary factor.”

This month, TRD looked at what’s happening in the Bronx, and what lies on the horizon.

B y S asha von O ldershausen

$500 million Amount the borough president

projects the redevelopment of the Special Harlem River Waterfront District as a mixed-use hub will generate in new development.

15% Rise in average income of

residents in the South Bronx neighborhoods of Highbridge, Concourse and Mount Eden from 2005 to 2010. Yet median income in those areas stood at only $25,834 in 2012, the most recent data available.

$1.35 billion The dollar volume of all Bronx

properties sold in 2013 — down slightly from 2012, but up 78 percent from 2011’s $757 million.

40% Increase in number of residents with a bachelor’s degree in Highbridge and Concourse between 2005 and 2010.

$75 million Cost of the Bronx’s priciest

residential development in 2013, a 1,300-unit, 10-building complex in Crotona Park being built by a group that includes Signature Urban Properties and GTIS Partners. It will replace a series of derelict warehouses.

$945 Average residential rent in the

neighborhoods of Highbridge and Concourse in 2010 — a 10 percent increase from 2005.

Crotona Park’s planned Compass Residences

5,594 Number of residential and

mixed-use units in the Bronx that investors purchased in 2014’s first quarter, for a total of $651 million.

That compared with 794 units for $72 million — an 800 percent leap — in 2012’s first quarter.

$341,500 Median price for homes in the

Bronx between December 2013 and March 2014. The median price in Manhattan was $1.25 million and $485,888 in Queens in that span.

12% Bronx unemployment rate as of

February, the highest of any county in the state. Citywide, it’s 7.9 percent.

New Listing By the Numbers

20,699

The number of crimes reported in the Bronx in 2013, versus 27,527 in Manhattan, which has about 190,000 more residents. Major crimes reported in the Bronx dropped 74 percent from 1990 to 2013. For the last five years, the drop was about 3 percent.

63% Portion of all new housing units added in the Bronx in 2013 that were market rate, compared with 43 percent in 2010.

Sources: Bronx Borough President’s office, Trulia, NYPD, New York City Housing Authority, state comptroller, State Department of Labor, Crain’s, Massey Knakal research

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NIKKI FIELD Senior Global Real Estate Advisor, Associate Broker | 212.606.7669 | nikki.field@sothebyshomes.com | www.nikkifield.com East Side Manhattan Brokerage | 38 East 61st Street, New York, NY 10065

Compiled by Yaffi Spodek

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: f o k s e

D e h t t

A

Richard Steinberg

E

very item on Warburg Realty broker Richard Steinberg’s desk is specifically arranged according to feng shui guidelines. The “chi,” or “universal energy balance,” appears to serve him well, judging by the string of multi-milliondollar deals — including the recent sale of a $24 million property at 15 Central Park West — that the 20-year industry veteran has under his belt.

Steinberg said he always had a passion for architecture, and he bought and flipped homes as a hobby during his 10 years as a practicing podiatrist. He switched careers in 1985, joining the now-defunct brokerage William B. May in 1991, then French firm Jean Marc Levet in 1993 and Warburg in 1995.

He discovered feng shui in 1989, when he sold a house for feng shui master Carole Shashona. The Springfield, N.J., native said the ancient Chinese system, which aims to harmonize material items with the surrounding environment, resonated with his natural spirituality.

Last month, he showed TRD how the harmony is his office influences his real estate brokerage business. B y Julie Strickland

Skiing Steinberg’s been skiing for 30 years, and has had a place in Aspen, Colo., for over 20 years. “All my friends are skiing less and less, and I don’t do bumps anymore, but I still ski black runs,” he said. He spent spring break in Aspen with his family, which now numbers 11,

SAGE

Wooden turtle

After he lights his candle, Steinberg takes a bundle of

This turtle was a gift from feng shui expert

sage and “cleanses” his office, including the area where

Shashona, in 2011. The turtle, one of the four

his team member Matthew Slosar sits, and the desk

Celestial Animals in feng shui, is considered

of his daughter-in-law Jill Steinberg, who along with

a guardian of good feng shui energy

Tammy Prunty is also a team member. “I burn it and

that is used as a protection and

wave it around, and there’s actually a blessing I

energy-strengthening cure.

say,” Steinberg explained. “The blessing changes

The turtle should have

month to month, and I say that every morning

its head facing

to get my day started. I’m a little OCD.”

south,

is associated

counting his wife, children and

with

five grandchildren.

Theater The first Broadway show Steinberg ever saw was “Mame,” when he was 12 years old. “And I could not believe it.” A few weeks ago, he went to the Cirque du Soleil–inspired interactive show “Queen of the Night,” which Aby Rosen created at the Paramount Hotel. “It was one of the most remarkable things I’ve seen in quite a while,”

and

money

and success.

Ivory necklace This ivory necklace, which belonged to Steinberg’s mother, who died about 10 years ago, is very old and fragile. “You’re always supposed to stay in touch with past generations,” Steinberg noted, “so I keep that at my desk because it makes me feel that she’s always around me, advising me.”

he said.

Candles His desk sports two candles, one for empowerment, and the other for purity. “I pretty much light the purity candle every day,” Steinberg said.

“And then if things seem to be going well or I’m working on a new deal, rather than the purity candle, I light the

Hamptons Film Festival A film buff, Steinberg is a supporter of the Hamptons International Film Festival. In October, he takes off time to attend, watching five films a day for four days. “It’s great, because you get to see them before they come out in the mainstream.”

24 May 2014 www.TheRealDeal.com

Green and yellow folders Steinberg’s desk is arranged with green and yellow folders.

Green, he noted, is symbol of prosperity, while yellow is strength and sunlight. On the left side of his upper desk are files and documents pertaining to customers he is presently working on or his exclusive listings, while the right side is completed deals, or those in contract or waiting to close. “I don’t know why, but I guess it has something to do with my being a lefty,” he said. “The work flow is left to right on the desk.”

empowerment candle.”

Paris “I’d be lying if I said there wasn’t something about Paris,” Steinberg noted, adding, “with my work schedule, the perfect vacation lasts five days, from a Wednesday to a Sunday.”

That’s not enough time for a trip to India or a safari in Africa. So Steinberg and his wife frequently jaunt to Paris, staying at the Hotel Montalembert on the Left Bank and spending their time going to museums and restaurants.

PHOTOGRAPH OF richard steinberg FOR THE REAL DEAL BY jeremy williams

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Re s i d e n t i a l Ma r k e t

By Mark Maurer uch has been written about the fact that prospective Manhattan buyers have grown frustrated by the lack of residential inventory in the market, but that distress is hitting new levels.

Brokers say some of their buyers are simply deactivating, at least temporarily, from the market.

Jason Haber, sales director at

M

More buyers take a break

Frustrated NYC apartment hunters deactivate from market to “clear” their heads

Warburg Realty, said one of his clients took a two-month timeout to “clear his head” after losing a bid for a one-bedroom condo with outdoor space on the Upper West Side. The client’s bid was among five for a unit that was only on the market for three days.

Similarly, Alyssa Soto, a broker at MNS, said one of her clients recently lost a deal to buy a studio in Chelsea as an investment property. After contracts were sent out

“Within hours or even minutes of losing an apartment, I’m sending them something else to consider. It really depends on the client and how they handle defeat in general.”

Jason Haber, Warburg Realty and the deal was almost fully negotiated for an amount below the asking price, a foreign investor put in an offer for the asking price and the deal was derailed.

“He gave up not just on me, but on the market,” Soto said, referring to her client. “Everything is getting sold over ask.”

Haber said he’s labeled clients’

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current emotional state as “buyer-tigue” and he noted that finding ways to keep frustrated buyers from simply opting out is the challenge of the moment.

“To be a good broker these days, you need a psychology degree,” said Haber, whose firm Rubicon Property was recently purchased by Warburg.

Brokers, he said, need to find ways to keep their buyers engaged.

“Within hours or even minutes of losing an apartment, I’m sending them something else to consider,” Haber said. “It really depends on the client and how they handle defeat in general.”

Others agreed, saying even when there is a lack of properties to show buyers, the key is to not let them give up hope or become jaded.

High-profile Douglas Elliman broker Leonard Steinberg said his approach is to motivate by way of cynicism, stressing to buyers that the sales market is not likely to get gentler on them anytime soon.

“Interest rates will rise eventually, but more importantly when all these new buildings units close — the bulk in 2015 — new pricing averages will be set that will make [this year’s] pricing seem like a good buy,” Steinberg said. “That could lift anyone’s spirits to focus on buying now.”

And Soto said she is advising clients who are only focused on Manhattan to explore the outer boroughs. Even though Brooklyn can be “just as frustrating,” it reinvigorates their search, she said.

If they insist on concentrating on Manhattan, she tells them to explore older listings for homes that have sat on the market for more than 100 days.

Meanwhile, the lack of inventory means that brokers need to get creative in terms of what they can show clients. In some cases, the lack of product makes it nearly impossible for an agent to avoid showing multiple clients the same units and have them competing against each other.

Michele Kleier, president and chair of Kleier Residential, said several of her clients were looking for practically the same home: three-bedroom-plus Upper East Side condos asking at least $8 million. Given the dearth of inventory, Kleier said she found herself Continued on page 122

The complete offering terms are in an offering plan available from sponsor. File No. CD11-0242.

In their words...

The funniest and most insightful comments on real estate

“Profiteers like [developer] Joe Farrell must be stopped from turning our historic village into a cheap, tacky Long Island suburb.

It must not become a film set for ‘The Real Housewives’ ” Harrison LeFrak, principal and vice chairman of the family-run LeFrak Organization, in a letter to the Southampton Board of Historic Preservation & Architectural Review.

“If you’re well off, it doesn’t take a lot of effort to reorient your life, especially if New York is still an unfriendly place to die.”

Ronald Weiss, a partner at Skadden Arps Slate Meagher & Flom, on how New York’s revised estate tax policies may cause more of its richest residents to flee to Florida.

“An off-market deal in New York City only means that there are 50 to 60 people looking at it.”

Bromley Companies CEO Nick Haines, on the intense competition in the mid-sized investment sales market.

28 May 2014 www.TheRealDeal.com

A&I Broadway Realty’s Mark Reznik, on how the growing tensions between Russia and the U.S. are dissuading wealthy Russians from splashing cash on New York property.

“I’m trusting that that is not going to be bargained off for some fugazi affordable housing.”

Community Board 1 member Paul Hovitz, on how the board will likely oppose Howard Hughes Corp.’s plans to build a 50-story tower next to Pier 17, and the future of the site.

“The more I truly cared “With our fathers, whoever about people, screamed the loudest the more ended up winning an money I argument. We talk it out.” made.”

A tongue-in-cheek Eric Rudin, on how he and cousin William Rudin manage the family’s giant portfolio and how decisions were made in the past.

“There is so much propaganda in Russia, people are scared to do business here.”

Retail guru Jeff Sutton, on how empathy can lead to lucrative deals.

“If you drop by Fiji and pick up some bottled water and drop it off in NYC, you can get LEED.” Anthony Malkin, at NYU’s annual REIT Symposium, on how easy it is to get “green building” certified.

Sources: New York Times, Wall Street Journal, Crain’s, Curbed, Massey Knakal conference, Baruch College event, TRD reporting.

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Pr o f i l e

Ackman bets big and high Hedge fund chief’s latest real estate investments, from his One57 buy to his increased stake in Fannie and Freddie, are drawing new industry attention Investor Bill Ackman is reportedly worth $1.5 billion.

W

By C. J. Hughes

ith a career marked by big real estate bets, which resulted in both hefty jackpots and big busts, it may not be surprising that William Ackman, who runs the $11 billion Pershing Square Capital Management hedge fund, continues to invest in the sector.

But his latest moves are drawing new attention from the industry.

In recent months, he bought a duplex penthouse at Midtown’s One57 that does not seem to lend itself to the buy-low, sell-high strategy that’s served him so well before.

In addition, Ackman’s decision to take a larger stake in South Street Seaport developer Howard Hughes Corp., a spin-off of the once-bankrupt mall operator General Growth Properties, also seems odd given the still-tenuous national commercial real estate market.

And he continues to be bullish about Fannie Mae and Freddie Mac, snapping up millions of additional shares of the mortgage finance companies over the past few months, despite hints that they may be dissolved.

This all comes as Ackman makes an aggressive bid for Allergan, the drugmaker behind Botox, and wages a high-profile battle against vitamin company Herbalife, which he is trying to sell short.

But many New York observers say that even if his recent investment targets seem unlikely, a counter-intuitive strategy has served Ackman well before.

The penthouse play In some ways, Ackman picked what seems like an unusual

30 May 2014 www.TheRealDeal.com

time to get in at One57, the skyscraping condo overlooking Central Park on 57th Street (see related story, page 48).

Ackman, along with a group of investors, was identified as a buyer of the duplex penthouse on the 75th and 76th floors known as the “Winter Garden” for its tall, curving glass ceilings.

If it closes at its reported price of more than $90 million, the 14,000-square-foot apartment will set a new record for most expensive home ever sold in New York City.

(At the end of last month, the sale had still not closed, according to city documents.)

Indeed, as the 1,004-foot building prepares to open,

about that extra change.

What seems more likely is that he will resell the apartment, and corner the very narrow market of buyers shopping in that stratospheric price range, said Jack Nyman, executive director of the Newman Real Estate Institute at Baruch College and a former developer.

“He will control a market that is very narrow and specialized,” said Nyman. “There are only so many condos like it in New York.”

In any event, the fact that Ackman was one of a group of investors in the deal limits his risk.

Though buying a condo as a group is highly unusual,

“This is someone who recognizes a small investment, where a big opportunity exists, is one to pursue. He loves optionality.”

Michael Ashner, Winthrop Realty Trust buoyed by a flurry of marketing and media attention, bargains would seem to be in short supply.

But Ackman — who lives in the Beresford, a prestigious co-op at 211 Central Park West, and who owns homes in Chatham, N.Y., and in Bridgehampton — is likely to have a smart play up his sleeve, analysts say.

The six-bedroom unit could be leased, for rents that could easily top $100,000 per month, said Sotheby’s broker Kevin Brown, who recently sublet a three-bedroom in a nearby condo for $78,000. But Ackman, whose fortune is said to be worth $1.5 billion, may not care so much

it’s indicative of Ackman’s creative and self-protective investing style, said Michael Ashner, CEO of Winthrop Realty Trust, which teamed up with Ackman in 2010 in a failed attempt to block the bankruptcy proceeding against Manhattan’s troubled Stuyvesant Town and take control of the residential complex. With that deal, the team ponied up just $45 million for the sprawling complex that at one time was valued at roughly $6 billion, Ashner said.

“This is someone who recognizes a small investment, Continued on page 124

www.TheRealDeal.com February 2014 49

RealDeal_Morris_Final.pdf

1

3/28/14

2:26 PM

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C

M

Y

CM

MY

CY

CMY

K

CONGRATULATES

MORRIS ADJMI FOR HIS ELECTION TO THE

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2014 AMERICAN INSTITUTE OF ARCHITECTS NEW YORK MERIT AWARD AND HIS

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REGULATING REAL ESTATE

Mortgage add-on fees hit hard

Punitive Fannie, Freddie fees hurt borrowers

By Kenneth R. Harney hen you’re raking in tens of billions in profit by helping credit-elite borrowers purchase homes, couldn’t you lighten up on fees a little for everyday folks?

That’s a question increasingly being posed to government-controlled home-mortgage giants Fannie Mae and Freddie Mac and their regulators.

Though most buyers are unaware of the practice, Fannie and Freddie — by far the country’s largest sources of mortgage money — continue to charge punitive, recession-era fees that can add thousands to financing costs. This despite enjoying record profits, low delinquency rates and rising home values, plus protecting themselves from most losses with insurance paid for by consumers.

Critics say by making conventional mortgages more expensive, these fees are partially responsible for recent declines in home purchases, especially among moderate-income, first-time and minority buyers. The add-on fees can raise interest rates for some borrowers to more than 5 percent, from the mid-4 percent range.

Since Fannie and Freddie operate under federal conservatorship and send their profits to the government, the fees amount to a federal surtax on homebuyers.

Last year, the two had a combined net income of nearly $133 billion and pre-tax income of $64 billion.

By contrast, the entire private-mortgage industry — big banks, small banks, mortgage companies, brokers, servicers and others — had $19 billion in pre-tax income, according to the Mortgage Bankers Association.

Fannie and Freddie got into deep financial trouble acquiring and backing poorly underwritten loans during the boom. But under regulatory supervision since 2008, they improved their performances, primarily by severely tightening credit standards. As part of that, they created “loan level pricing adjustments” designed to charge more to borrowers with certain per-

W

32 May 2014 www.TheRealDeal.com

ceived risks. Small down payments, for example, get hit with higher add-on fees than larger ones.

Applicants with low credit scores are assessed much higher fees than those with pristine records.

Buyers of condominium units who make down payments of less than 25 percent get charged a hefty extra fee no matter what their scores. Fannie and Freddie also charge lenders fees to guarantee mortgage bonds — again ladled onto borrowers’ bills — and those have doubled since 2011.

Critics like Mike Zimmerman, senior vice president of private mortgage insurance company MGIC, calls the companies’ add-ons “arbitrary” and excessive under current market conditions.

For some borrowers, he says, the fees can increase monthly costs of a 5 percent down payment loan on a $220,000 house by up to 7 percent. Since Fannie and Freddie are already insured against most losses on low down payment loans by private insurance, he argues, these add-ons are unnecessary.

A spokesperson for the two corporations’ regulator — the Federal Housing Finance Agency — declined to comment on the issue of add-on fees. The agency has a new director, former North Carolina Congressman Mel Watt, who has made virtually no public statements since taking over in January.

He is said to be studying options regarding key policy issues.

Mortgage Bankers Association CEO David Stevens says the fees are thwarting home purchases, especially in the under-$417,000 segment dominated by Fannie and Freddie. Stevens said in an interview the fees are out of line with their real risks and are hurting homeownership.

Could this change, and borrowers get a break?

It’s up to Watt, and so far, he is mum.

Kenneth Harney is a syndicated columnist.

GOVERNMENT BRIEFS Sandy buyout program expands The New York State Office of Storm Recovery said a state-sponsored buyout program for Staten Island homes damaged by Superstorm Sandy is expanding its coverage again. The program, launched

by Gov. Andrew Cuomo last year, targets homeowners whose storm-damaged housA Staten Island home destroyed by Superstorm Sandy es are in areas deemed likely to flood again, and purchases them at their pre-storm value, plus an additional 10 percent incentive. The buyout originally covered the neighborhood of Oakwood Beach and was then expanded to include Ocean Breeze. It will now also cover about 130 homes in the enclave of Graham Beach, which is bordered by Jefferson Avenue, Olympia Boulevard, Father Capodanno Boulevard and Naughton Avenue.

So far, the state has purchased 170 homes in Oakwood beach for $70 million. Once bought, the homes are demolished and the land left for environmental purposes like wetlands restoration and coastal buffer zones.

Bill to force equal access to high-end amenities Democratic City Council Member Mark Levine, who represents the Upper West Side, is boosting a bill that would grant rent-stabilized tenants equal access to high-end amenities in their buildings.

The bill, which is still being drafted, would amend a current human rights code to include protections for rent-stabilized tenants. In particular, elected officials targeted two Upper West Side buildings, the managements of which prohibited rentstabilized tenants from accessing newly added amenities. In March, state Assembly City Council Member Member Linda Rosenthal, also an Upper West Mark Levine Side Democrat, introduced a similar bill that would slap fines of as much as $25,000 on landlords who deny renters access to amenities.

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Top Residential Firms 2014

Big firms, big listings A townhouse at 22 East 64th Street

A unit in the Plaza Hotel

A unit in the Time Warner Center

T

By Katherine Clarke he strength of the Manhattan luxury market is continuing to buoy some of the city’s largest and most established firms, The Real Deal’s annual ranking of the borough’s top residential firms shows.

Despite historically low levels of inventory and a drop in their total number of exclusive listings, firms like Douglas Elliman, the Corcoran Group, Brown Harris Stevens and Sotheby’s International Realty — those which have a substantial share of the luxury market — saw the total dollar volume of their Manhattan listings jump year-over-year, according to TRD’s ranking, which reviewed a snapshot of data pulled from Online Residential March 30. That, of course, suggests that they’ve nabbed a significant number of pricey exclusives.

Elliman, which ranked at the top of TRD’s list, nabbed 62 percent more in listings dollar volume this year than last, bringing its total listing dollar value — including new development units — to an all-time high of $3.6 billion.

Brokerages with a hold on the luxury market see dollar volume of listings rise despite dwindling number of for-sale properties

A penthouse at 250 West Street

A penthouse at the Pierre Hotel

The top five firms in the city by agent count were Elliman, Corcoran, Halstead Property, Citi Habitats and Coldwell Banker A.C. Lawrence.

Meanwhile, Corcoran and BHS saw the biggest jump in listing volume of all the largest brokerages in the city. Corcoran saw a 65 percent rise to $3.4 billion from $2.1 billion last year, while BHS saw a nearly 63 percent rise to $2.1 billion from $1.3 billion. In addition, Sotheby’s saw its total listing

A penthouse at 21 West 20th Street

inventory crunch took hold.

“The luxury market is an extremely important market to be fluent in for any broker, especially now, since there are more high-net-worth individuals living in New York than ever before,” said Wendy Maitland, president of sales at brokerage Town Residential. “It’s not something that happens because you can get a certification or a degree in it. It happens with experience.”

Meanwhile, the inventory crisis rages on, impacting the number of listing exclusives at firms citywide. There have been fewer than 5,000 apartments on the market at any given time over five consecutive quarters, according to a recently released report by Elliman. Listing inventory remained flat year-over-year, rising by only 0.2 percent, in the first quarter, according to the report, which was compiled by appraiser Jonathan Miller. There were 4,968 apartments on the market in the first quarter of this year, the report shows, compared with 4,960 in the first quarter of 2013.

Overall, the top 12 firms had a total of $12.7 billion in exclusive Manhattan sales listings, up about 52 percent from $8.5 billion in 2013.

34 May 2014 www.TheRealDeal.com

dollar volume hit $1.3 billion, a nearly 32 percent increase year-over-year.

Overall, the top 12 firms had a total of $12.7 billion in exclusive Manhattan sales listings, up about 52 percent from $8.5 billion in 2013. While a significant uptick, that’s still not back up to the 2012 figure of $13.4 billion, before the

Top Residential Firms 2014

Number of Manhattan agents

Rank

2014

2013

Firm

2014

2013

% Change

1

1

Douglas Elliman

1,725

1,599

8%

2

2

The Corcoran Group

1,191

1,091

9%

3

3

Halstead Property

721

617

17%

4

4

Citi Habitats

703

607

16%

5

5

Coldwell Banker A.C. Lawrence

519

511

2%

6

6

Rutenberg Realty

489

478

2%

7

9

Town Residential

472

388

22%

8

7

Bond New York

450

451

0%

9

8

Brown Harris Stevens

431

447

-4%

10

10

Nest Seekers International

410

260

58%

11

n/a

Keller Williams NYC

343

240

43%

12

11

Sotheby's International Realty

267

248

8%

“A lot of people are feeling it,” said Gary Malin, president and CEO of Citi Habitats. “There’s a lot out there being built, but there’s not enough coming online to be able to relieve some of the pressure. What does come online is always at the highest price points, so you’re talking about a select group of people that will be in that sort of market.

“It’s the non-new development inventory that needs to rise to help the market continue to grow,” he added.

There appears to be no end in sight for the inventory drought, sources said. That means continued difficulties for brokerages striving to secure exclusives. “[Inventory] will be a challenge for longer than even this year,” said Diane Ramirez, president of Halstead Property.

“We’re all working around it and doing what we can.”

Swimming against the tide

For the city’s largest firms, the biggest problem this year, as it’s been for the last few years, was convincing sellers to sell, brokers said.

Across the board, the number of exclusive listings per firm is down compared to last year.

In fact, nine of the top 12 firms saw a drop in the number of exclusives, but some fared better than others. Elliman and Corcoran saw small dips of roughly 4 percent and 1 percent respectively, while Halstead saw a decrease of 12 percent and BHS saw a 1 percent increase.

Rutenberg Realty saw the number of listings it has plummet 45 percent year-over-year, the biggest drop in that category of any firm of the ranking. However, the dollar volume of the firm’s listings dipped by only 2 percent, suggesting that it’s taking on more high-priced listings.

Rutenberg’s top executives were not immediately available for comment.

Not surprisingly, the average number of listings per agents fell at almost every company — except for BHS, Coldwell Banker A.C. Lawrence and Bond New York, which saw their averages remain steady. The largest drops were at Nest Seekers International and Citi Habitats; both firms saw average listings per agent decline by 39 percent.

“When there are fewer and fewer listings, you have more people competing over less and less,” Malin said. “At the moment, if you speak to anyone, they’ll say listings are very tight.”

In fact, the only firm to see a significant uptick in its number of listings was Keller Williams NYC, which had 80 exclusive listings on March 30, according to TRD’s findings, up from 68 in 2013. That success was tempered, however, by a 41 percent drop in the dollar volume of those listings.

The firm’s total listing dollar volume fell to $109 million from $186 million.

Eric Barron, KWNYC’s CEO, downplayed the significance of the drop in the firm’s listing dollar volume, saying the figures represented only a snapshot of activity.

“Sales are going into contract so quickly, making listing volume extremely volatile from day to day,” he said. “The market update is a snapshot of one day. On the flip side, over the first 15 days of April, we’ve signed 19 new listings totaling $47 million in new business in Manhattan alone.”

“We’re continuing our expansion and look forward to launching Downtown later this year,” Barron added.

When it comes to listing volume, the established highend firms made hay. For example, while relative newcomer KWNYC logged a median listing price of $885,000, Sotheby’s — the firm that topped the category — had a median listing

Total Manhattan listings

Rank

2014

2013

Firm

2014

2013

% Change

1

1

Douglas Elliman

954

993

-4%

2

2

The Corcoran Group

830

836

-1%

3

3

Halstead Property

387

440

-12%

4

4

Brown Harris Stevens

356

353

1%

5

5

Sotheby’s International Realty

166

183

-9%

6

6

Town Residential

140

136

3%

7

8

Citi Habitats

82

118

-31%

8

9

Coldwell Banker A.C. Lawrence

81

115

-30%

9

n/a

Keller Williams NYC

80

68

18%

10

11

Nest Seekers International

68

78

-13%

11

10

Rutenberg Realty

48

87

-45%

12

12

Bond New York

31

32

-3% www.TheRealDeal.com May 2014 35

Top Residential Firms 2014 A unit at 740 Park Avenue

A townhouse at 278 West 11th Street

A penthouse at 70 Greene Street

The Corcoran Group’s Pam Liebman

A penthouse at 140 Charles Street

price of roughly $3.7 million. BHS, which ranked second in that category, notched a listing price of $2.3 million, according to TRD’s analysis.

Luxury begets luxury While the market was tight for many firms, brokerages with the strongest grips on the luxury market actually saw their total listing dollar volume soar. In Corcoran’s case by a massive 65 percent and in Elliman’s by 62 percent.

Despite the listings crunch, Corcoran CEO Pam Liebman said closed sales volume at the firm has not suffered, and the firm’s properties are selling faster than ever.

Corcoran again dominated in the new development arena. In November, the firm’s new development marketing arm Corcoran Sunshine announced that it would team up with development giant Related Companies on the marketing and sales

of all of Related’s upcoming New York City condo projects, including the Zaha Hadid–designed tower at 520 West 28th Street and the residential buildings at the forthcoming Hudson Yards mega-project.

To some degree, the jumps in dollar volume at firms can be attributed to the broader rise in pricing citywide: these days, the same amount of exclusives often means a higher dollar volume then it did a few years ago.

Douglas Elliman’s Dottie Herman

The proof is in the numbers. The average sales price for a Manhattan apartment jumped by almost 31 percent year-overyear, according to Elliman’s quarterly figures. The average price per square foot increased by roughly 24 percent in the first quarter, to $1,363.

The rise was even more pronounced on the luxury end, where the average price was $2,706 per square foot, a roughly 41 percent increase.

“It feels to everyone that this year, we’ve just taken off,” said Dottie Herman, Elliman’s president and CEO. “But it’s really the result of a lot of years of working and strategic planning. It might look like a ‘wow,’ but it’s not about anything I did just this year.”

Herman said Elliman has been building momentum in recent months thanks to its rebranding campaign, which followed its split with Prudential and the resulting shortening of

“The luxury market is an extremely important market to be fluent in for any broker, especially now, since there are more high-net-worth individuals living in New York than ever before.”

Wendy Maitland, Town Residential

Total $ volume, Manhattan listings

Rank

2014 2013

(in millions)

Firm

2014

2013

Net change

% Change

1

1

Douglas Elliman

$3,599

$2,220

$1,379

62%

2

2

The Corcoran Group

$3,440

$2,085

$1,355

65%

3

3

Brown Harris Stevens

$2,085

$1,283

$802

63%

4

4

Sotheby’s International Realty

$1,327

$1,009

$318

32%

5

5

Halstead Property

$666

$652

$14

2%

6

7

Town Residential

$356

$327

$29

9%

7

8

Nest Seekers International

$164

$162

$2

1%

8

11

Citi Habitats

$112

$76

$36

47%

9

n/a

Keller Williams NYC

$109

$186

-$77

-41%

10

10

Coldwell Banker A.C. Lawrence

$95

$90

$5

6%

11

9

Rutenberg Realty

$92

$94

-$2

-2%

12

12

Bond New York

$23

$31

-$8

-26%

36 May 2014 www.TheRealDeal.com

Top Residential Firms 2014

Average listingS per Manhattan agent

Rank

2014

2013

Firm

2014

2013

% Change

1

1

Brown Harris Stevens

0.83

0.79

5%

2

2 (tie)

The Corcoran Group

0.70

0.77

-9%

3

2 (tie)

Sotheby's International Realty

0.62

0.77

-19%

4

5

Douglas Elliman

0.55

0.62

-11%

5

4

Halstead Property

0.54

0.71

-24%

6

7

Town Residential

0.30

0.35

-14%

7

n/a

Keller Williams NYC

0.23

--

--

8

8

Nest Seekers International

0.17

0.27

-39%

9

9

Coldwell Banker A.C. Lawrence

0.16

0.15

4%

10

10

Citi Habitats

0.12

0.19

-39%

11

11

Rutenberg Realty

0.10

0.18

-45%

12

12

Bond New York

0.07

0.07

0%

A view from the deck at a unit in the Sherry-Netherland

A townhouse at 125 East 70th Street

Neil Binder of Coldwell Banker A.C. Lawrence

A townhouse at 1145 Park Avenue

Eddie Shapiro of Nest Seekers

Median listing price for properties

Rank

(in thousands)

2014

2013

Firm

2014

2013

% Change

1

1

Sotheby's International Realty

$3,650

$2,697

35%

2

2

Brown Harris Stevens

$2,300

$1,700

35%

3

4

The Corcoran Group

$1,995

$1,295

54%

4

5

Douglas Elliman

$1,750

$1,100

59%

5

7

Nest Seekers International

$1,285

$799

61%

6

6

Town Residential

$975

$1,047

-7%

7

8

Halstead Property

$965

$725

33%

8

n/a

Keller Williams NYC

$885

--

--

9

9

Rutenberg Realty

$849

$699

21%

10

12

Coldwell Banker A.C. Lawrence

$699

$474

47%

11

11

Citi Habitats

$575

$499

15%

12

10

Bond New York

$549

$502

9% www.TheRealDeal.com May 2014 37

Top Residential Firms 2014

Manhattan agents with a $10M listing or higher

Rank

2014

2013

Firm

2014

2013

% Change

1

3

Douglas Elliman

50

37

35%

2

2

The Corcoran Group

30

38

-21%

3

1

Brown Harris Stevens

22

40

-45%

4

4

Sotheby's International Realty

19

27

-30%

5

6

Town Residential

8

8

0%

6

5

Halstead Property

6

11

-46%

7

10 (tie)

Citi Habitats

2

0

--

8 (tie)

8 (tie)

Nest Seekers International

1

1

0%

8 (tie)

8 (tie)

Rutenberg Realty

1

1

0%

8 (tie)

10 (tie)

Coldwell Banker A.C. Lawrence

1

0

--

11 (tie)

10 (tie)

Bond New York

0

0

0%

11 (tie)

n/a

Keller Williams NYC

0

--

--

Manhattan agents with no active listings

Rank

2014

2013

Firm

2014

2013

% Change

1

1

Bond New York

95.3%

94.7%

0.6%

2

3

Citi Habitats

92.3%

88.5%

3.8%

3

4

Nest Seekers International

92.0%

88.1%

3.9%

4

2

Rutenberg Realty

91.4%

89.5%

1.9%

5

5

Coldwell Banker A.C. Lawrence

90.4%

86.7%

3.7%

6

n/a

Keller Williams NYC

89.8%

--

--

7

6

Town Residential

82.6%

80.2%

2.4%

8

7

Douglas Elliman

74.1%

72.8%

1.3%

9

8

Halstead Property

71.7%

68.4%

3.3%

10

9

The Corcoran Group

70.7%

68.3%

2.4%

11

11

Sotheby's International Realty

69.3%

65.7%

3.6%

12

12

Brown Harris Stevens

64.7%

63.5%

1.2%

Source: All data was gathered from the OLR listing portal on March 30. Data includes only Manhattan-based brokerages and agents and only active Manhattan residential sales listings that had been updated within the last 360 days at the time of the survey. Data does not include multi-family properties, listings that are in contract or listings that have pending offers. Percent changes are based on figures before rounding. Primary rankings are based on number of Manhattan agents; firms on that list are then ranked by other factors.

its old Prudential Douglas Elliman name. (Elliman had previously been the largest franchisee in the Prudential Real Estate and Relocation Services network.)

Elliman’s surge in dollar volume might also be partially a result of its recent spate of high-profile hires, including some agents it nabbed from Town following a public spat between Town’s founders.

For example, one of those agents, Robert Dvorin, has $105 million in exclusive listings, including a $26 million Greenwich Village townhouse at 80 Washington Place and a $16 million penthouse at 55 Warren Street in Tribeca.

Another standout of the top 12 firms: Citi Habitats.

Despite its reputation as a rental giant, the firm saw the dollar volume of its sales listings soar by a surprising 47 percent year-over-year, according to TRD’s findings.

It won several pricey listings, including one that it snagged from Elliman in October for a $13 million, Winka Dubbeldam–designed penthouse at 497 Greenwich Street. The firm also has exclusives on a $6.6 million West Village townhouse at 113 Bedford Street, and a $12.5 million prospective Soho loft building at 508 Broadway.

still by far the two largest firms in the city, according to TRD’s analysis, which this year used agent data pulled from OLR. Elliman clocked in with 1,725 agents, up 8 percent since last year’s ranking, while Corcoran logged 1,191, up 9 percent.

Meanwhile, three firms — Town, KWNYC, and Nest Seekers — saw dramatic growth in terms of number of agents. The three-year-old Town saw its count jump by 22 percent, to 472.

That was despite the month-long legal battle earlier this year between the firm’s owners, Andrew Heiberger and Joseph Sitt, a dispute which saw a string of the company’s top-producing

has 343 agents, a 43 percent increase over 2013.

Barron attributed the rise in the firm’s agent count to an error in last year’s count.

Still, Barron estimated that KWNYC’s agent count had gone up by between 20 and 30 percent, with notable additions including Janet Wilkinson and Susan LeFevre, partners who signed after a successful run together at Corcoran.

Nest Seekers’ agent count jumped to 410, according to TRD’s research, a 58 percent rise year-over-year. But despite the expansion, the firm didn’t see any big changes in the number of listings it signed, or the dollar value of those listings.

The firm saw a 13 percent drop in exclusives and only a 1 percent uptick in the dollar value.

A Nest Seekers spokesperson disputed the numbers, but additional listings the firm sent TRD to consider for the ranking were not active listings and therefore not counted.

For the most part, firm heads said they haven’t been aggressively looking to open new offices. Once the inventory squeeze loosens up, that may change, they said.

“I’m hoping we’ll get a little bit of relief this spring. Many people kept their apartments off the market waiting for the better weather, but I don’t see any huge changes in the regular resale inventory,” Liebman said. TRD

Nine of the top 12 firms on the ranking saw a drop in the number of exclusives on their books, but some fared better than others.

Strength in numbers When it comes to agent head counts, Elliman and Corcoran are 38 May 2014 www.TheRealDeal.com

agents head for the door. (In addition to Dvorin, Patty LaRocco, James Cox, Frank Arends and Clayton Orrigo also jumped ship.)

Town’s number of listings increased by 3 percent yearover-year, and it’s total dollar volume of listings increased by 9 percent. KWNYC, meanwhile, made its debut on TRD’s top Manhattan firms list, which is based on agent count, thanks to the 103 agents it recruited since last year. The company now

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Top Residential Firms 2014

SHAKING UP the middle

mid-sized firms had 340 listings worth $1.15 billion, according to TRD’s research. Of those firms, the top nine firms had $1.12 billion this year, compared with $909 million last year.

Without Stribling in the mix, however, Manhattan’s midsized firms would have seen a drop in dollar volume, possibly a reflection of the declining inventory levels.

Leading the pack

Among mid-sized firms, Stribling trounces rivals, while other brokerages see leads shrink

T

By Katherine Clarke he residential brokerages that dominate the middle of the Manhattan market saw some serious reshuffling this year.

These firms — too small to make it onto the top firms list, but too big to be classified as “boutique” — experienced something of a shake-up, with some of last year’s companies falling off, only to be replaced by a collection of newbie firms.

The ranking, which was tallied by dollar volume of listings, and was The Real Deal’s second mid-sized firm survey ever, included firms with between 50 and nearly 260 agents. Data was culled from listings provider Online Residential on March 30.

Nabbing the No. 1 slot on the list was the 256-agent firm Stribling & Associates, which last year appeared on the main top-firm ranking. While Stribling had roughly $552 million in listing dollar volume, far more than the majority of the firms on the main ranking, it was knocked off that list because that ranking is done by number of agents. So although Keller Williams NYC pulled ahead of Stribling in terms of number of agents and made it onto TRD’s main ranking this year, Stribling is doing more business with fewer brokers.

In fact, the firm’s listing dollar volume is up 44 percent from $384 million last year, thanks to its increasing share of the luxury market.

“We turned 34 this year, so we’ve shown that we know how to find success in the luxury market, which is the arena where you’re seeing a lot more people come out and spend,” said Elizabeth Ann Kivlan, president of Stribling.

Following Stribling, in the No. 2 and No. 3 spots, respectively,

CORE’s Shaun Osher

Daniel Hedaya of Platinum Properties Warburg’s Fred Peters

Stribling’s Elizabeth Ann Kivlan

were Warburg Realty, which saw its listings remain relatively steady year-over-year at $166 million, down from $188 million the previous year, and CORE, which had roughly $157 million in exclusives. CORE, which took the top spot on this mid-sizedfirm ranking last year, saw a 54 percent drop in its listings.

Bolstered by Stribling’s exclusives, collectively, the top 12

Despite being surpassed by Stribling this year, last year’s mid-sized leaders —Warburg, CORE and Blu Realty — still dominated their rivals. However, their leads are shrinking.

CORE’s drop in listing dollar volume came during a year in which it saw a handful of its top brokers, including Michael Graves, Vickey Barron and Reba Miller, depart. Last month, Miller, who previously headed the firm’s new Upper East Side office, left to relaunch her own boutique company, R.P. Miller & Associates. In 2012, CORE struck a two-year deal to absorb R.P. Miller, which expired earlier this year. Susan Rubell and Lee Frankel, two former agents with R.P. Miller who joined CORE after the 2012 deal, left with Miller for her relaunching.

Shaun Osher, CEO of CORE, said the firm’s listings on March 30 did not paint an accurate picture of how much business the company has been doing.

“Last year was the first year we came very close to doing $1 billion worth of business,” Osher said. “It was our best year since we launched. In 2014, we’ve signed on projects worth $2 billion in new development. Our pipeline looks very strong.”

Nonetheless, Miller took with her two of the listings CORE received credit for — an $18.5 million listing for a new development townhouse at 27 East 61st Street and an $11.5 million townhouse at 241 West 17th Street.

Meanwhile, Warburg had 65 listings worth $166 million, according to TRD’s findings. That was slightly down compared to its $188 million worth of listings last year, which were spread out over just 53 properties. In January, the firm also beefed up its presence on the Upper West Side by making its first acquisition of another brokerage — Jason Haber’s Rubicon Property—for an undisclosed sum.

Blu Realty had 22 listings worth a total $91 million, compared with 28 listings worth $80 million last year.

The company’s listing count would have been higher had the firm not unloaded a $16.5 million Upper West Side townhouse belonging to Brazilian oil executive Paolo Gouveas in its biggest deal ever in February, said firm founder David Tobon.

Continued on page 124

TOP MANHATTAN MID-SIZED FIRMS (dollar volume in millions)

RANK 2014

2013

Firm

No. of Listings in 2014

No. of Agents in 2014

Total Dollar Value of Listings in 2014

Total Dollar Value of Listings in 2013

% Change in Dollar Volume

1 2 3 4 5 6 7 8 9 10 11 12 13

n/a 2 1 4 n/a 5 n/a n/a 9 7 n/a 8 6

Stribling & Associates Warburg Realty CORE Blu Realty Platinum Properties Fenwick Keats Oxford Property Group KIAN Realty Level Group DJK Residential Spire Group City Connections MNS

126 65 42 22 11 18 7 15 10 11 9 10 6

256 153 78 58 68 94 211 172 144 57 161 93 51

$551.8 $166.0 $156.9 $91.3 $51.5 $38.2 $32.1 $22.4 $13.7 $9.8 $9.7 $9.3 $8.7

$384.0 $188.1 $344.0 $80.5 $13.4 $44.2 --$11.8 $13.9 -$13.1 $27.4

44% -12% -54% 13% 284% -13% --16% -30% --29% -68%

Source note: Data was gathered from OLR on March 30. Rankings include Manhattan-based brokerages and agents with active Manhattan residential listings updated within 360 days. Multi-family properties and listings in contract or that had pending offers were excluded. Firms that primarily represent one building were excluded. In addition, firms that are primarily involved in new development marketing or mostly have listings in a new development building that they originally marketed or where they have a connection to the developer were excluded. Firms with 50-plus agents that didn’t make the biggest firms list were eligible.

40 May 2014 www.TheRealDeal.com

Top Residential Firms 2014

The boutique

“We don’t feel as though we’re competing with the large firms,” said Noel Berk, founder of boutique brokerage Mercedes/ Berk, which ranked No. 8 this year with roughly $39 million worth of listings. “When you’re a small firm and you’re working only on luxury, you don’t have to have a lot of listings. You can get a phone call from someone out of the blue, and all of a sudden you have a $15 million listing that two days before you had no idea you would have. It can change overnight.”

BOOM

Feeding off foreign buyers

Dolly Lenz’s brokerage takes top prize, while other newbie firms also make debut on ranking

T

By Katherine Clarke his year’s boutique brokerage ranking was stirred up substantially by the formation of several new luxury-focused companies, which have planted their flags firmly in Manhattan. The cluster of start-ups has more than one root: some were founded by industry veterans, and others by new names leveraging international interest in the New York market.

The most notable of those firms was established last July by power broker Dolly Lenz following her departure from the city’s largest firm, Douglas Elliman. Lenz, whose firm is called Dolly Lenz Real Estate, has since racked up a large number of pricey listings.

The brokerage, which had two active agents as of March 30, ranked No. 1 on this year’s boutique ranking, with six listings worth $156.9 million.

Lenz’s priciest listing is fashion mogul Tommy Hilfiger’s sprawling Plaza Hotel penthouse duplex, which is on the market for a cool $80 million.

Placing No. 2 was perpetual market leader Leslie J. Garfield, which has a large chunk of the townhouse market. The firm had $126.2 million worth of listings, up substantially from $93.8 million last year. Its listings included a $30 million townhouse at 12 East 96th Street. The building, which can be converted to a single-family mansion, was formerly home to a bilingual school.

“On the one hand, we have more institutional business, and those tend to be larger transactions,” said Jed Garfield, president of Leslie J. Garfield & Co., referring to nonprofits and institutions selling their headquarters. ‘But having said that, we also have some huge properties owned by individuals.

When people see the prices that their neighbors are getting,

Dolly Lenz’s new firm took the top boutique prize.

Jed Garfield of Leslie J. Garfield

The Modlin Group’s Adam Modlin

Some of the firms that debuted on this year’s boutique ranking did so by capitalizing on the interest in New York City properties from the international buyer community.

New York Residence, a Midtown-based company founded

by Austrian entrepreneur Thomas Guss, is one of those firms.

The brokerage, which has offices in Hong Kong, Singapore and Seoul, does 50 percent of its deals with foreign buyers, Guss said. Its listings include an $8.4 million townhouse at 8 Perry Street and several resale listings at the Centurion building at 33 West 56th Street. The Centurion, where the penthouse is asking $39 million, has proved popular with foreign buyers, Guss said, noting that many international buyers like its glassy design by starchitect I.M. Pei. The company had a total $120.4 million in listings on March 30, placing it at No. 3 on the ranking.

“New York is still cheap in the international market,” Guss told TRD, adding that his company is leveraging that reality with clients.

Domus Realty, a Madison Avenue-based firm that also specializes in dealing with foreign investors, clocked in at No. 5 on the boutique firms list, with $82.5 million worth of Manhattan properties for sale. Its priciest listing, a $48 million 14,000-square-foot, seven-story townhouse at 57 East 64th Street, helped boost that dollar figure. The house is owned by an entity called Valan Realty, which bought it for $6.39 million in 1995. The home was listed by Domus President Giampiero Rispo, a native of Naples, two months ago. It was previously listed by Beverly Cole of Town Residential.

“Buyers are coming from everywhere in the world,” Rispo said. “Lately, we’ve seen a lot of Turkish buyers looking for pieds-à-terre in New York.”

Mercedes/Berk founder Noel Berk

Old guard vs. newbies

they’re like, ‘Well my house is nicer than that,’ and they put it on the market.”

The boutique ranking — which this year captured firms with between 2 and 50 agents — is, not surprisingly, the most volatile of TRD’s three annual Manhattan residential brokerage rankings because just one or two big listings can make a huge difference to a firm’s bottom line.

Stalwarts of the Manhattan market like the Modlin Group and the aforementioned Mercedes/Berk, firms that have been active in luxury listings for years, are also seeing the benefit of limited inventory and a boom in the luxury sector.

The Modlin Group, which ranked No. 4, had $115.3 million worth of listings, up from $84.2 million last year. The firm, Continued on page 122

Top Manhattan boutique firms (dollar volume in millions)

Rank 2014 Rank

2013 Rank

Firm

2014 Listings

2014 Agents

2014 Total Dollar Volume

2013 Total Dollar Volume

% Change in Dollar Volume

1 2 3

n/a 1 n/a

Dolly Lenz Real Estate Leslie J. Garfield & Co. New York Residence

6 10 18

2 11 36

$156.9 $126.2 $120.4

-$93.8 --

-35% --

4 5 6 7 8 9

2 n/a n/a 4 5 n/a

The Modlin Group Domus Realty Peter McCuen & Associates Fox Residential Group Mercedes/Berk Sloane Square

9 6 3 13 5 3

7 16 2 46 10 13

$115.3 $82.5 $79.5 $43.9 $38.9 $31.5

$84.2 --$64.4 $38.2 --

37% ---32% 2% --

Source: Data was gathered from the OLR listing portal on March 30. Rankings include Manhattan-based brokerages and agents with active Manhattan residential listings updated within the last 360 days. Data does not include listings in contract or listings that have pending offers. Firms that primarily represent one building were excluded. In addition, firms that are primarily involved in new development marketing or mostly have listings in a new development building that they originally marketed or where they have a connection to the developer were excluded. “Boutique” was defined as firms with two to 50 agents.

www.TheRealDeal.com May 2014 41

(and we’re just getting started)

HARLEM Greenwich

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BED-STUY MAKES 30!

Out of prison, Hochfelder back in the business

Onetime industry wunderkind now working as consultant at Merchants Hospitality

By Mark Maurer dam Hochfelder, the star real estate executive who went to prison in 2010 for bilking lenders and investors out of $18 million, has quietly reentered the property game.

Released from prison in late 2012 after two years in jail, the 43-year-old began working a year and a half ago as a consultant at Merchants Hospitality, a firm led by developer and restaurant owner Abraham Merchant that specializes in development and management of real estate, restaurants and hotels.

The onetime wunderkind of New York real estate appears intent on maintaining a lower profile this go-round in the business.

His hiring by Merchants, for example, was not widely publicized. He is not listed as a member of the firm on its website.

“I’m happy being a dad, a coach and helping these guys out [at Merchants],” Hochfelder told The Real Deal. He declined to comment further.

Hochfelder’s Twitter postings show he managed to reclaim much of his private life since his release from prison. He regularly posts photos of himself and his two

A

44 May 2014 www.TheRealDeal.com

Left, Adam Hochfelder. Center, the Brill Building at 1619 Broadway, which Merchants Hospitality purchased last year, after Hochfelder joined the company as a consultant. Right, Abraham Merchant.

sons — ages 14 and 12 — at sporting events and Merchants-run restaurants. Living in Manhattan, he also owns a house in Malibu, Calif., and coaches his son’s football team.

Half a dozen real estate executives visited Hochfelder in prison to talk potential job opportunities, sources said. One of them was Abraham Merchant, who offered him

a position and the back-corner office at the firm’s 111 Broadway headquarters.

“Merchants had prior dealings with Mr. Hochfelder, and when an opportunity arose to bring him in the firm as a consultant, my partner Richard Cohn and I invited Mr. Hochfelder to immediately come on board,” Merchant said in a statement. “It was one

of the best decisions we ever made. He is a brilliant and well-liked guy.”

In the past year and a half, Merchants has received financing from Cantor Fitzgerald, JPMorgan, Hyatt and Goldman Sachs. Merchants co-owns the Brill Building, which it jointly acquired with Allied Partners’ Eric Continued on page 126

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The City Council’s new speaker: Still a wild card T Three months in, real estate players are still trying to gauge how Melissa Mark-Viverito will impact the industry

By Mark Maurer he new City Council Speaker, Melissa Mark-Viverito, swept into office firmly in lockstep with Mayor Bill de Blasio, especially on the issue of affordable housing.

But with just over three months now under her belt, the real estate community is still closely watching Mark-Viverito to gauge her leadership style, trying to establish better communication with her, and to see where (if anywhere) she will differ from de Blasio on key development issues.

So far, the verdict on that last point is still out. However, not surprisingly, sources say they expect the East Harlem Democrat and Puerto Rico native to stray from her council predecessor, Christine Quinn.

Quinn started out as an affordable housing advocate, but later won over much of the development community by backing its large projects. Mark-Viverito, meanwhile, has little track record on the real estate front, though she has stood against the industry on some big issues.

“There is certainly concern [in the industry] that she will be much different than Christine Quinn,” said Hank Sheinkopf, a lobbyist and Democratic strategist. “She has not yet been tested, but she will.”

Industry sources said they are optimistic that Mark-Viverito is at least open to hearing their concerns. She has met with several developers and real estate players over coffee, both before and after her election to the council’s highest post, and made an appearance at the Real Estate Board of New York’s annual gala back in January.

“She clearly is concerned about community-based employment while being mindful of the commercial realities of a project,” said Tom Montvel-Cohen, a spokesperson for Albee Development, which is co-developing the mega-mixeduse City Point project in Downtown Brooklyn.

“I was gratified to learn how open-minded and thoughtful she was about the complexities of these projects — and [that she’s shown] a desire to find solutions to create benefits for both the projects and surrounding neighborhoods,” he added, noting that while he didn’t meet with her directly, Mark-Viverito met with an executive from Washington Square Partners, City Point’s development manager.

REBNY officially stayed out of the speaker’s race, and that was said to be because Mark-Viverito — who was reportedly not its choice candidate — seemed likely to beat her opponent, Council

46 May 2014 www.TheRealDeal.com

Member Daniel Garodnick, and the trade group didn’t want to pick the wrong horse. In other races, REBNY spent millions to try to bring about a real estate- and business-friendly council.

The new speaker didn’t side with the industry on a big recent issue, the rezoning of Midtown East, which had strong backing from the industry. She referred to it as “a big giveaway” during a panel discus-

two of his projects — an East Harlem mixed-income complex called Tapestry, and Harlem RBI’s DREAM Charter School on a public housing site.

“She’s a get-things-done person, not slow-things-down person, which is very important,” said Rose. “I have enormous respect for her.”

And Mark-Viverito, who declined to comment, has seen some financial

comes to real estate-related issues. Her most significant appointment to date was installing Brooklyn Council Member David Greenfield as chair of the council’s most powerful committee: Land Use, which votes on key development projects and has veto power over City Planning Department rezoning proposals. Unlike Mark-Viverito, Greenfield is a moderate and not a member of the labor-supported

Melissa Mark-Viverito’s ascent to speaker of the City Council has sparked concern among some in the industry.

So far, the verdict is still out on how Mark-Viverito will differ from de Blasio on development issues. However, sources say they expect her to stray from the path of her Council predecessor, Christine Quinn. sion, according to the news website Capital New York.

Nonetheless, REBNY officials insist that Mark-Viverito is an “exemplary” speaker, citing, for example, her quick response in handling March’s East Harlem building explosion.

“She has expressed a willingness to work with us, and we’re willing to work with her,” said Jamie McShane, REBNY’s spokesperson and a former spokesperson for Quinn. “We respect her office and her role.”

Jonathan Rose, CEO of Jonathan Rose Companies, which largely focuses on affordable housing, called the new speaker a “strong voice” in the approvals for

support from the industry.

The Witkoff Group, the Lighthouse Group, Marathon Development, and three unions (two representing hotel workers and one representing plumbers) collectively contributed 87 percent of the $30,000 raised at her inauguration party in late January, the New York Daily News reported. And several New York real estate players have donated to her past campaigns for council and speaker, including Edison Properties CEO Stephen Nislick, Monadnock Construction President Nicholas Lembo and Mack Company partner Fredric Mack.

There are some other clues as to how Mark-Viverito might proceed when it

Progressive Caucus. At the time of his appointment, he told Crain’s he expected chairs to be “empowered to run committees independently.”

Sheinkopf said Mark-Viverito’s pick is “a signal to development firms not to panic, and to disprove any sense that she would be a preconceived opponent to development.”

Mark-Viverito also appointed Garodnick — who, while running for speaker, was said to be “softening” his relationship with the industry — as chair of the Economic Development Committee.

Elsewhere, she picked Brooklyn Democrat Jumaane Williams to head up the Housing and Buildings Committee.

Since assuming the role, Williams has proposed anti-industry legislation that would give community boards a say in the construction of new hotels — even if a developer has as-of-right approval to build their project.

Real estate lawyer Adam Leitman Bailey said fears that Mark-Viverito will support economic development policies that Continued on page 120

www.TheRealDeal.com February 2014 49

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Development

One57 — from (unit) A to Z A look at the deals, budget and revenue at the city’s most-talked-about condo tower A rendering showing the expansive views from a One57 apartment

G

By Hiten Samtani ary Barnett’s One57 is the most talked-about residential project to hit the city since 15 Central Park West.

But while it may be providing juicy, of-themoment fodder for the industry, the land for the 90-story skyscraper took a decade for Barnett and his team at Extell Development Company to assemble.

The long process was worth the wait for him. Barnett reportedly had to put up only 10 percent of the $700 million equity investment for the $1.4 billion tower, which is located on West 57th Street overlooking Central Park. (He convinced two Abu Dhabi–based investment funds, Aabar Investments and Tasameem Real Estate Company, to cough up the rest.)

Extell and its partners are expected to gross about $2 billion in sales from the project, according to news reports.

This month, The Real Deal took a close-up look at the glassy behemoth — from its 10 closed sales to its other notable, incontract deals. We also reviewed amendments that Extell recently filed with the state Attorney General’s office that detail some of the quirky rules that the building’s owners, wealthy and powerful as they may be, will be required to follow, and outlined the building’s operating budget and revenue intake.

Needless to say, the tower shouldn’t be hurting for cash if enough owners pony up for storage bins, some of which are asking a stratospheric $4,000 per square foot.

And despite controversy along the way, which has played out in 19 civil suits against the building, the mega-project comes with outsized expectations and many unconventional flourishes. Read on for a look.

NYC’S priciest storage bins?

Deeded underground parking and maid’s quarters are old news; these days the latest “extra” up for purchase in New York’s priciest condos may be the least sexy: storage bins. At One57, there are 21 of them up for grabs, but those who need the subterranean space to stash away their bric-à-brac can expect to pay big. One57 is asking $216,000, or about $4,000 a square foot for a 54-square-foot bin, according to a recent amendment that Extell filed with the AG.

48 May 2014 www.TheRealDeal.com

As a point of comparison, that price rivals the average persquare-foot price of a condo at Jared Kushner’s Puck Building penthouses at 295 Lafayette Street.

“I’ve never seen that at any other buildings,” said CORE’s Emily Beare, one of the city’s top luxury brokers. “Usually, buildings of that caliber would include a storage unit with the apartment.”

Three of the 30-square-foot storage bins are asking $110,000 each, or about $3,667 per square foot. In comparison, similarly sized bins at 15 CPW go for about $35,000.

Policing the pets One57 residents are permitted no more than two “orderly domestic” pets, such as dogs, cats, caged birds and aquarium fish. And while many buildings have tight security for guests, One57 will have the same for Fido. According to the building’s bylaws, residents will be required to give the board a photograph of their pets. And owners’ furry friends cannot have visitors — non-resident pets are animalia non grata.

But Beare said that’s par for the course at high-end buildings these days and that some white-glove coops take their pet surveillance a step further. “Some co-ops even have ‘pet interviews,’ where a buyer’s pet has to meet the board,” she said.

That’s not the only area that the board has a say in. Buyers who wish to get into the holiday spirit might want to buy elsewhere. The building does not allow decorative lights for those who wish to deck the halls — or their own windows — for the holidays.

In fact, even curtains and blinds in individual units must be approved by the board.

But these types of rules are not unique in the residential trophy tower

world: 15 CPW has similar restrictions on window decorations.

And the rule has not deterred buyers.

One57’s budget — revealed Extell estimates that the building will generate $8.25 million in its first year of operations — which started on July 1. The biggest contributors to that income are projected to be residential common charges, which should come to an estimated $7.45 million, according to filings with the AG’s office. Hotel common charges should tack on another $775,000.

By comparison, during 15 CPW’s first year, the projected common charges were about $6.6 million, according to that building’s offering plan. That means that residents at the 94-unit One57 will pay a far heftier sum, on average, than their counterparts at 15 CPW, which has 202 units.

On the expenses front, One57 has earmarked $2.5 million just for heat and hot water, perhaps with the expectation that residents will be using their Tuscan marble tubs to take long baths. The tower will also dish out about $1.57 million to its staff for salaries, wages and benefits.

And the building will spend $1.43 million on electricity, and nearly $1 million on “services and supplies,” which may, at least partly, account for the cost of cleaning One57’s 8,400 windows to ensure pristine views.

Doorman details One57 will maintain a staff of 18 — or more precisely, 18.4, according to its filing. That includes seven porters, 4.2 doormen, 4.2 concierges, two handymen and one full-time “resident manager,” a role akin to a maître d’ at a high-end restaurant. Most of the employees are expected to be members of Local 32BJ SEIU. Though an 18-person staff may seem Continued on page 126

Development

One57’s big buys

Unit: 85 Price: Just under $50 million Buyer: Lawrence Stroll Canadian fashion tycoon Lawrence Stroll, the other half of the Michael Kors IPO dream team, is reportedly worth $1.8 billion. He paid just under $50 million for his 6,200-square-foot, four-bedroom, four-and-a-half-bathroom unit shortly after sales at the building launched. Extell’s most recent asking price for the apartment was $62 million.

Surveying the most buzzworthy purchases in the building — plus the first wave of deals that have officially closed

Unit: 59A Price: $30 million Buyer: George Constantin The man behind commercial real estate investment firm Heritage Realty Services snapped up this 4,483-square-foot, three-bedroom, four-and-a-half-bathroom unit in a sale that officially closed in April. Before founding Heritage, which has $400 million in assets, Constantin was at real estate firm Helmsley-Spear. He currently lives in Westchester, according Heritage’s website.

T

By Hiten Samtani he luxury market has received a lot of press for the outrageous prices buyers are paying.

And at almost no building is that truer than at One57, where the average price per square foot is $6,888, according to the building’s offering plan.

The 94-unit tower, which officially launched sales in late 2011, is now 75 percent sold, according to an Extell spokesperson. Two of those sales eclipsed the $90 million mark, the spokesperson confirmed, meaning that when they close, they’ll break the city’s current $88 million record, which was set at 15 Central Park West.

While only 13 units in the building have closed to date — closings started late last year —roughly 60 others are in contract. The closed units, which TRD detailed on the below chart, range in price from $3.6 million to $30.6 million. While most of those deals are not the sexiest in the building, they are hugely important to moving the building into its next phase. And many of the in-contract deals — the most prominent of which are outlined below — are expected to close in the coming months. See below for a look at both.

Unit: 48A Price: $17.5 million Buyer: Richard Kringstein The CEO of apparel maker Herman Kay Company, which makes outerwear for brands such as Anne Klein, opted for this 3,228-square-foot pad on the 48th floor, which has three bedrooms and threeand-a-half bathrooms and was most recently asking $20.5 million.

Unit: 40F Price: $9.6 million Buyer: David Beyda Beyda is the CEO of Town & Country Living, a prominent linen manufacturer. His 2,289-square-foot pad on the 40th floor was most recently asking $9.95 million.

Unit: PH 75 Price: $90 million to $100 million Buyer: Consortium of investors led by hedge-fund titan Bill Ackman

Ackman and his fellow investors are in contract for this 13,554-square-foot duplex condo on the 75th and 76th floors, which was asking $115 million. Its most notable feature is a two-story, 51-foot-wide glass enclosed “winter garden” with a curved glass roof.

Ackman, the CEO of the hedge fund Pershing Square Capital, has said that the buy was purely an investment, and he would not look to live in the apartment.

Unit: PH 90 Price: More than $90 million Buyer: Unknown This 10,923-square-foot duplex on the 89th and 90th floors has six bedrooms and six-and-a-half bathrooms and had an asking price of $115 million. It was snapped up last May for more than $90 million by a mystery buyer. The apartment’s pièce de résistance, sources said, are its panoramic views of the city and Central Park. From the unit, Vanity Fair’s Paul Goldberger wrote in a recent essay “you feel as connected to the sky as to the ground.”

Unit: 82 Price: Just over $50 million Buyer: Silas Chou The heir to a Hong Kong–based fortune, Chou is worth $2.4 billion, according to Forbes, and was part of the two-person team that took apparel brand Michael Kors public in 2011. His 6,240-squarefoot, four-bedroom, four-and-a-half-bathroom unit at One57 was most recently asking $57.5 million.

Unit: Unknown Price: $6.5 million Buyer: Unnamed Chinese businesswoman This buyer generated international headlines when she bought this pricey pad for her daughter, in the anticipation that it would come in handy when her kid would attend Columbia or Harvard. The catch? Her daughter’s still a toddler, just two years old.

One57’s first wave of closed deals

Buyer

Unit

Sale Price

Size (sf)

PPSF

Rainbow Choice International Ltd. George Constantin, Heritage Realty Services LSF US 57 Corp.

Terry Johnson West 57-47B Realty Corp.

NYC Condo LLC Metty Properties LLC Eli Lomita, Kingfield Stables Core Apparel LLC Condo 40C 157 West LLC Diane Montagna Lilian Ea Tao Liu

60A 59A 40B 39B 47B 39C 43B 45B 41B 40C 42B 40A 39A

$30.6 million $30 million $9.2 million $9.1 million $8.76 million $7.5 million $7.3 million $6.9 million $6.8 million $6.7 million $6.6 million $4.0 million $3.6 million

4,200 4,483 2,145 2,145 2,009 1,985 2,009 2,009 1,988 1,985 1,988 1,060 1,060

$7,142 $6,701 $4,250 $4,226 $4,360 $3,759 $3,625 $3,448 $3,433 $3,361 $3,296 $3,730 $3,365

Source: Public records and PropertyShark.

www.TheRealDeal.com May 2014 49

Commercial

gray areas NYC’s

real estate game The not-quite-black, not-quite-white areas of the industry, from gaming building sellers to sneakily flipping contracts

T

By C. J. Hughes he real estate industry was never known for choirboy-like behavior.

Many people can share a tale of backstabbing or dirty dealing. Most times, these acts fall into an ethical gray area.

Many of them are well documented on the residential side. For example, The Real Deal and others have written about pocket listings — when a broker fails to follow rules set forth by the Real Estate Board of New York and doesn’t let other brokers know about a listing they have, in an effort to swipe the entire sales commission for themselves.

Some residential brokers also intentionally fail to indicate that an apartment has a signed contract, to reel in potential buyers for other properties in a bait-and-switch move.

But in the more opaque world of commercial real estate, sketchy behavior remains further under the radar, brokers said. In the past, cash commissions were sometimes used to sidestep taxes, but now a whole different host of ethical infractions are coming out of the woodwork, as more money is put into play.

Brokers, lawyers and analysts said cutting corners is increasing in this environment of escalating property values — especially as more newbies enter the market.

Plus, they said, the industry is gradually consolidating, meaning that firms are taking on more duties in-house: brokering, lending and developing. That means that the risks of self-dealing are higher.

Not surprisingly, real estate professionals said these self-dealers are just a few bad apples in the bunch.

“A true professional with a high intellect can differentiate themselves,” said Stephen Siegel, chairman of global brokerage at CBRE Group.

In the following story, TRD explores these not-quiteblack, not-quite-white areas that have some in the industry concerned.

Inaccurate comps

C

omparable deals, or comps, are real estate’s lifeblood.

But the rules for setting comps can be loose, and, sources said, listing brokers readily exploit them, especially for retail, where market data is not as accurately tracked as the data for office space.

On paper, a store may appear to be renting space for, say, a steep $1,000 per square foot. But that may not factor in the several months of free rent and complimentary space build-out that the landlord threw in, lowering the net effective rent significantly.

A listing broker representing a nearby space risks stepping into a gray area when he cites that comp to prospective tenants, knowing it’s inflated.

In general, the industry would be better served if comps were readily disclosed through an independent clearinghouse, brokers said.

“There is no PropertyShark for leases once they are

Promises of purchase

T

hey’re the real estate equivalent of stock options: signed agreements to purchase a building down the road.

But so-called “letters of intent,” or LOIs — often the first step in that purchase process — can tie the hands of a property owner, and are viewed by many sellers as sneaky, if not downright hazardous.

At their worst, sources said, they can allow duplicitous buyers to occasionally pull off scams like this: Buyers lock in the sellers with an LOI. Then, the buyers get a third party to make a fake offer — “maybe a wife, their mother, [or] a friend,” said one veteran broker.

The original buyer then claims to have heard through brokers that the seller violated the terms of the LOI by talking to the third party.

The seller is hamstrung if that straw buyer gets the seller to sign another contract, though either way, the seller has breached the initial contract.

A spokesman for the New York State Department of State, which regulates real estate brokers, said the agency does not monitor these types of scams because they involve private individuals. The Attorney General’s office, meanwhile, said it had no way of tallying these cases, adding that they would generally be resolved in civil court.

Once that breach of contract happens, the original buyer sues, tying up the property in litigation, giving him more time to evaluate the market and decide whether the property is worth purchasing. That move, which comes with the risk that the scam could be exposed, also locks in the sales price.

If property values keep climbing, the seller could be cheated out of significant dollars.

On the other hand, if the market tumbles, the buyer can walk away scot-free.

More generally, though, these types of maneuvers are

“The [letters of intent] that I’ve gotten, they were pretty much trying to tie in the deal without putting real money behind it. There was always something underhanded behind it. They’re not worth the paper they’re written on.”

50 May 2014 www.TheRealDeal.com

Thomas Hong, BSJ Holdings signed. There is no ACRIS,” said Adelaide Polsinelli, an investment sales broker with Eastern Consolidated, referring to the popular website and the city property records database, both used for sales comps on the residential side of real estate.

“There’s really no place to verify the accuracy of any claims,” she said.

Commercial shortcuts used by buyers who don’t have their loans in place or are otherwise not serious about a deal, said Thomas Hong, the principal of BSJ Holdings, a New Jersey–based holding company for real estate and apparel businesses.

In 2012, when Hong was trying to sell a five-story Soho building at 72-76 Greene Street, several buyers came to him with LOIs. He demurred.

“At the end of the day, the LOIs that I’ve gotten, they were pretty much trying to tie in the deal without putting real money behind it. There was always something underhanded behind it,” he said. “They’re not worth the paper they’re written on.”

In the end, he ended up going with a firm that just wanted to execute a contract: L3 Capital, a Chicago-based retail investment firm, which bought the building for $41 million.

LOIs, which according to brokers are used mostly on deals between $15 million and $50 million, aren’t necessarily all bad, said Isaac Kohannim, a vice president with commercial brokerage Capin and Associates, which focuses on Northern Manhattan and the Bronx.

Many sellers depend on them as a way to vet the prospective buyer, said Kohannim, noting that about 60 percent of his transactions include LOIs. “The main intention is to find out what your terms are as a buyer,” he said. “They are useful.”

Others said as long as the language in the letter is clearly non-binding, the seller will not get trapped.

Conflicts of interest

A

s real estate companies expand into different aspects of the business, conflicts of interest can arise.

That’s what outdoor sports retailer Eastern Mountain Sports, or EMS, claimed happened at 530 Broadway, which is owned by Thor Equities, and is now mired in litigation. The case is illustrative of the potential conflicts that are increasingly prevalent throughout the commercial sector in New York.

In this case, EMS signed a 15-year deal in 2008 with a starting rent at about $280,000 a month, according to court papers.

But sales in the store were weak, and the company later decided that it wanted out.

In 2013, EMS enlisted Thor High Street Advisors, Thor Equities’ retail brokerage arm, to find a tenant to take over its lease, court records show.

Thor High Street found Brandy Melville, a fashion chain, to pay roughly $310,000 a month, with the landlord keeping the difference. But Thor High Street’s parent company, Thor Equities, rejected that deal.

Around the same time, news broke that investor Jeff Sutton had signed a contract to buy the building (along with some adjacent buildings) for $327 million, with plans to shake up the tenancy.

Although the affiliation between the brokerage and landlord was clearly disclosed — and the two firms share a name to boot — EMS sued Thor Equities in November for $10 million, claiming a conflict of interest.

“Both the broker and the landlord assured EMS’s representatives that such affiliation made the broker uniquely attuned to the landlord’s requirements for an acceptable

assignee or sublessee,” the complaint stated. But it added Thor High Street “would abandon its fiduciary duties to EMS in favor of the landlord, its affiliate.”

Thor Equities denied that EMS got anything other than fair treatment, and has moved to have the case dismissed.

As of early last month, the case was still winding its way through New York State Supreme Court.

Financial shortfalls

B

rokers, who are often the ones accused of duplicitous behavior, said sometimes the clients are the ones acting shady.

Mostly, it’s over a basic buyer claim: That the buyer has the money to buy a property. While many buyers in big deals bring in outside investors, some are not truthful about how much cash they can contribute, or have access to upfront.

Drilling clients with questions can help weed out buyers who are bluffing about their finances, said Brian Ezratty, an investment sales broker with Eastern Consolidated, who has completed $10 billion worth of transactions in a two-decade career.

“You ask what he owns; he may say, ‘I’ve done a couple deals,’ ” Ezratty said. “And I say, ‘Okay, which buildings are they? I know all of the addresses in the city.’ Then, they start backtracking.”

The tall tales run the gamut: Some buyers say they have relationships with bankers who can provide debt financing; others claim all their equity is tucked inside special funds, said Doug Harmon, a top broker with Eastdil Secured, “but then they don’t have the money for a deposit.”

But by some measures, breaking deals may be less of a problem now than in the past. During the last boom, when banks were more generous, and a borrower could finance 90 percent of any deal, promises were being broken repeatedly, Harmon said.

“When you add that kind of rocket fuel,” he said, referring to the easy credit, “everything gets more competitive.”

Today, though, banks scrutinize deals much more closely, which slows down the process and adds transparency, which in turn makes buyers and sellers act more ethically, Harmon said.

Underhanded flipping

S

ometimes buyers aren’t as innocent as they purport to be. In fact, some brokers actually disguise themselves as regular buyers and then attempt to flip contracts.

Most of these underhanded brokers are up-andcomers who don’t have track records, and can therefore get away with fooling sellers, sources said.

Here’s how it works: The broker pretends to be an interested buyer and signs a contract to purchase a building. But just before the 90-day contract period is up, he turns around and finds someone else to pay more, justifying the higher price with the promise of added air rights, a potentially higherpaying tenant or another sweetener.

Then a double closing is scheduled, and the property changes hands twice, in quick succession, with the first buyer pocketing the profit.

Sellers, who were essentially cheated out of extra cash, are, not surprisingly, miffed. Sources noted that weakly worded contracts are partly to blame.

And while a lightning-quick resale usually isn’t illegal, there could be illegality if the broker didn’t identify himself as such in the fine print, sources said.

Some brokers, however, say there is another side to the story, and that contract flipping can be an above-board practice if the broker is up front about his intentions.

Sources described a slightly different scenario, in which the broker lines up a first buyer, but then quickly finds a second, higher-paying buyer to flip the contract to.

They say when a broker steps in with a transparent plan to flip a contract, it essentially guarantees that the sale will go through, because if one buyer backs out, another is waiting in the wings.

And, brokers noted, many sellers don’t care if contracts are flipped, as long as they are happy with the sales price they get.

Either way, sellers should investigate buyers’ backgrounds and demand that the 10 percent contract deposit go directly into their account — and not a thirdparty escrow account. That can help sellers if the original buyer fails to find a new purchaser, and attempts to back out of the deal, sources said.

Owners of single assets, who are less experienced at selling and who have properties listed around $5 million, are often the targets for these types of flips, sources said.

“But buyers who do this a lot have developed a very bad reputation in the industry,” said one longtime commercial broker. “It’s a lesson learned, working with them.” TRD

“Dealing with the ‘highest and best’ is like dealing with mercury. You will think that it’s in your hands, and then it will slip through your fingers. ‘Final and best’ only means ‘final and best’ at that moment in time.”

Ira Nesenoff, Nesenoff & Miltenberg Harmon said he asks for the names of banks and hedge funds to vouch for some clients’ claims.

“It’s the new guys, fast on the scene, loud and brash,” he said. “Those are the guys with red flags.”

Not ‘best and final’

I

n a hot market, a handshake isn’t always worth a lot, as buyers and sellers frequently go back on their word, brokers said.

TRD has reported about this on the residential side, where sellers frequently agree to a “best and final” offer and then back out to accept a higher bid.

The same backsliding is now happening on the commercial side. In today’s heated market, building owners and landlords are also often willing to make a few extra dollars, even if it means going back on a promise, brokers said.

“Some people honor handshakes and others don’t,” said Eastdil Secured’s Harmon, who explained that sellers often send out multiple contracts simultaneously.

Usually, drafting numerous contracts isn’t illegal. But for people who believe that a handshake is tantamount to a deal, learning that a seller went with a rival buyer can sting.

And the courts may not help.

Nesenoff cited a recent case of an aggrieved would-be buyer of a Brooklyn industrial building who lost a lawsuit that targeted a seller who broke his word.

“A handshake for buying and selling real estate property is not enforceable,” he said.

www.TheRealDeal.com May 2014 51

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The lease masters are in-(the)-house A

By Hiten Samtani fter about two years of scouting for a location, Facebook committed to establishing its New York headquarters at 770 Broadway in May. The complicated deal came together after Vornado, the building’s owner, took back a 160,000-square-foot space from media company Nielsen and then approached the social networking giant. But Facebook only wanted 100,000 square feet, with the option to expand later.

So Vornado put together a two-year, 60,000-square-foot deal with online gambling company High 5 Games, in the anticipation that Facebook would absorb the space at the end of the lease.

The transaction, said Vornado’s leasing director Glen Weiss, involved five tenants and 16 documents. But it was sewn up in 23 days.

“This is an example of what we do for a living,” he said.

Weiss is among an elite cadre of New York commercial in-house leasing professionals who together oversee more than 100 million square feet of prime Manhattan office space for the city’s top landlords.

Their jobs require granular knowledge of each building in their massive portfolios, and also a chess master’s sense of how all the pieces fit together and how each deal plays into their company’s long-term growth strategy.

“They’re able to talk interchangeably about their assets,” said Mary Ann Tighe, CEO of mega brokerage CBRE Group’s New York Tri-State Region. “If you bring them a credit-worthy tenant with a heartbeat, they can find a way to get you what you need.”

These six in-house leasing pros control over 100 million square feet of New York City office space

This month, The Real Deal looked at this under-the-radar group of individuals.

Some — like 44-year-old Weiss, a self-described Vornado “lifer”— climbed to the top of the leasing food chain at their current companies. Others, such as 39-year-old Jeremy Moss of Silverstein Properties and 54-year-old Steven Durels of SL Green Realty, earned their chops at traditional commercial firms and joined their current companies at a more senior level.

But the job evokes strong feelings about being in-house rather than working for a brokerage, where the commission-based structure could ostensibly lead to greater financial rewards for top performers. Being in-house is “an opportunity to build and grow a business, versus building and growing a book,” said Brookfield Office Properties’ David Cheikin. “It’s about creating something tangible and emotional.”

Though none of the in-house executives would discuss compensation, Tighe said it was likely that their packages, which include bonuses, were commensurate to their brokerage peers.

“No one keeps a very gifted in-house agent undercompensated,” she said, “just for the reason that they could come here and lead our agency group.”

Tighe added that some people were also attracted to the more defined career path available to in-house employees.

“An in-house person can go on to become the CEO or a top executive at a landlord,” she said. “A broker just becomes an older broker.”

Larry Silverstein, chairman of Silverstein Properties, said that an in-house leasing director was in a position of “enormous responsibility, with great authority to consummate deals.”

construction.”

As an owner, he’s “extremely adaptable,” Turchin added, because SL Green owns so many more buildings and has such a diverse portfolio compared to other landlords.

But Durels is not one to charm a tenant and take them out to lunch, said Tighe, who’s worked with him on several buildings, including 280 Park Avenue and 3 Columbus Circle. “He’s very direct and very focused,” she added. “The more hair on the deal, the more’s he’s excited and engaged by it.”

Durels, whose brother Thomas runs leasing at Empire State Realty Trust,

joined SL Green in 1998 after a 16-year run at commercial firm Helmsley-Spear, where he oversaw a 2.5 million-square-foot portfolio. His leasing and marketing team includes 19 employees, significantly more than his counterparts at other landlords.

An SL Green insider said the REIT exerts an even tighter grip on leasing than its competitors and prefers to use brokers as consultants, rather than dealmakers.

When doing deals, Durels taps into several of SL Green’s key strengths, including its role in structured finance, sources said.

“You can’t do a condo interest purchase and a simultaneous lease without pulling in other threads of the company,” Tighe said.

Steven Durels

Glen Weiss

SL Green Realty

Vornado Realty Trust

Square Feet in NYC: More than 30 million

S

L Green signed Citigroup to a 2.6 million-square-foot renewal at Tribeca’s 388-390 Greenwich Street in December, ending an 18-month marathon of talks between the banking giant and New York City’s largest commercial landlord. The deal will see Citi shift its global power base from Boston Properties’ 399 Park Avenue, and allow SL Green to “play offense” in 2014, CEO Marc Holliday said in a January conference call.

The REIT, which owns more than 30 million square feet of commercial space in New York City, hopes to lease about 2 million square feet this year, Holliday

PHOTOGRAPH OF DURELS FOR THE REAL DEAL BY CHRIS MARTIN 42 May 2014 www.TheRealDeal.com

said at the time. The person responsible for getting them there is Steven Durels, perhaps the most low profile and yet the most aggressive player on this list.

The Citi lease was the latest in a string of big deals for Durels, including a 1.6 million-square-foot renewal and expansion at 1515 Broadway with entertainment giant Viacom in 2012, and a 340,000-square-foot lease with Young & Rubicam at 3 Columbus Circle in 2011.

Durels knows his sprawling portfolio inside-out, CBRE’s Peter Turchin said, from the “1,000-square-foot prebuilt space to the 500,000-square-foot new

Square Feet in NYC: More than 20 million

V

The deal that will see Citigroup shift its headquarters to 388-390 Greenwich Street was the latest of a string of high-profile wins for SL Green’s Steven Durels.

ornado is a high school sweetheart of sorts for Weiss, who started his real estate career at age 16 as a summer porter with the Mendik Company, now a Vornado subsidiary.

“I swept the sidewalks, ran the freight elevators, all that stuff,” he said.

He worked his way up to an assistant building manager’s role at Mendik in 1992, and when Vornado acquired the 4 million-square-foot Mendik portfolio in 1997 for $650 million, his responsibilities expanded to include leasing.

www.TheRealDeal.com May 2014 53

Commercial Brokerage “[Vornado was] buying a building a month at that point,” Weiss said.

He took over the firm’s New York portfolio in 2007 and now also oversees its Chicago and San Francisco properties. In New York, he stewards over 20 million square feet of office space and is at the helm of a seven-person team that did about 2.4 million square feet of leasing last year. He works closely with Vornado CEO Steven Roth, who sees leasing as central to the REIT’s strategy. “In our business, leasing is the main event,” Roth said recently in his annual letter to shareholders.

“It’s a very unique position in the marketplace,” Weiss said of his role. “I get in the mix and I’m also involved in the company’s global strategy.” He weighs in on acquisitions and capital improvement projects, for example, by helping the company’s top executives understand what building upgrades would be attractive to tenants and how much rents can be increased if they’re implemented.

As with the Facebook deal, Vornado does most of its leasing deals and building management in-house. “It’s a rarity for us to go outside,” Weiss said. “We have a way about doing things that works in the market.”

The exception to this rule is the 1.29 million-square-foot 280 Park Avenue, which Vornado co-owns with SL Green.

In 2011, the duo hired CBRE to lease the building. The partners also kicked off a $150 million capital improvement project at the building that year, and have since

cial development and leasing.

At Silverstein, he started off by picking up leasing efforts at 7 World Trade Center, taking the building from 75 percent to 100 percent leased. He now oversees a six-person team responsible for a roughly 10 million-square-foot portfolio in New York. This includes 4 World Trade Center, which has about a million square feet available, and the still-to-be-built 3 World Trade Center, which signed on advertising giant GroupM as an anchor

seating could work for them. He has that kind of patient and optimistic temperament that wears well in this business.”

Silverstein echoed Tighe’s take. “He must have spent about six months of his life” on the deal, he said. “Jeremy adds value to everything he touches.”

GroupM remains the sole tenant at

Glen Weiss

David Cheikin

Brookfield Office Properties

Square Feet in NYC: 20 million

T David Cheikin Boston Properties’ Andrew Levin worked with Baron Funds to expand the money manager’s presence in the GM Building, the nation’s priciest office tower.

Jeremy Moss

“An in-house person can go on to become the CEO or a top executive at a landlord.

A broker just becomes an older broker.”

Mary Ann Tighe, CBRE Group hiked asking rents by more than 40 percent, according to Crain’s.

In January, Weiss, his SL Green counterpart Durels and CBRE’s Tighe and Turchin brought two hedge funds to the building, Napier Park Global Capital and Mount Kellett Capital Management, which leased about 60,000 square feet between them. Both deals were in the $80s per square foot, and Tighe said they also signed tenants for up to $120 per square foot at the building.

“Glen is the lovable face of Vornado,” said Tighe, who’s worked with Weiss on several deals over the years. “Even if you ask him something preposterous, he can’t help himself to either feel sorry for you or help you in some way.”

Jeremy Moss Silverstein Properties

Square Feet in NYC: 10 million

M

oss joined Silverstein Properties in 2008 from Forest City Ratner, where he was a vice president of commer-

54 May 2014 www.TheRealDeal.com

ever built, it might have,” he said, “but we’ve been doing this a long time.”

Moss said the opportunity to “work with a legend like Larry Silverstein” and to contribute to the WTC project were two of the key reasons he opted to remain inhouse at Silverstein instead of plying his trade at a brokerage.

“Financial reward is not the only consideration,” he said. “At the end of the day, I get to see a physical, tangible product that improves the skyline and creates an environment for the city. As someone who grew up in New York, that was an opportunity I could not pass by.”

tenant for 516,000 square feet in December. (The company does not control One World Trade Center, which was developed by the Durst Organization and the Port Authority of New York and New Jersey.)

Silverstein Properties also selected a CBRE team led by Turchin and Tighe to lease up its WTC buildings.

“We elect to bring agents in on certain properties, depending on how that property is positioned,” Moss said. “In new development, having an agent can be particularly helpful,” he added.

Tighe said that an outside agent’s job is to bring to the table as much knowledge of the competing buildings as possible. She also said that Moss was gifted at helping a tenant visualize their space.

“Jeremy’s role is to say ‘hello tech company, or hello financial company, let us tell you what it would look like to work here,’” she said.

Tighe singled out Moss’s role in the GroupM deal, in which five of the floors had 68,000-square-foot floor plates.

“Those were the trading floors. They were built for financial firms,” Tighe said.

“Jeremy showed the tenant how bench

Vornado’s Glen Weiss sewed up the deal to bring Facebook to 770 Broadway in 23 days.

3 WTC, yet Silverstein is trying to strike a better financing deal for the tower’s construction by asking the Port Authority to back $1.2 billion in tax-exempt bonds.

Though he’s taken a fair bit of criticism in the press for the attempt, he said that the negotiations aren’t hurting the building’s leasing efforts.

“If this had been the first building we’d

hree years ago, Brookfield made a $250 million bet on the 8 millionsquare-foot Brookfield Place, the Downtown office complex formerly known as the Word Financial Center. Brookfield is in the final stages of upgrading the retail and public spaces at the complex, where it’s had a hard time filling the 4.5 millionsquare-foot vacancy left by Merrill Lynch in October. With about 2 million square feet still left to lease, Brookfield is now using the retail, where it has signed on stores such as Paul Smith and J.Crew, as a lure for top-drawer office tenants.

“People want to be in the middle of this culinary destination,” Cheikin said.

“They want the energy of sitting atop this fashion destination. The retail play at Brookfield Place is responsible for at least 50 percent of the [office] leasing we’ve done there.”

Including the Brookfield Place complex, Cheikin and his two direct reports oversee a 20 million-square-foot portfolio in New York. Among the properties is Manhattan West, a 7 million-squarefoot mixed-use complex on the Far West Side expected to be completed in 2017.

Brookfield tapped a Cushman team led

by Bruce Mosler to manage office leasing at that property.

Cheikin said Brookfield uses outside brokers for about half its leasing deals.

“Frankly, brokers see more volume than us,” he said, referring to the fact that top brokers typically do more deals than in-house directors. “The ones that are very good as landlord reps, they put their Brookfield hats on throughout the transaction.”

The REIT is aiming to lease about 1.5 million square feet in New York this year, he said.

The 38-year-old Cheikin kicked off his career with a four-year stint at Jones Lang Wootton, the predecessor to JLL, in its advisory services and leasing programs.

He joined Brookfield 12 years ago, after Continued on page 120

www.TheRealDeal.com January 2014 31

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Moynihan Station air rights targeted in broker pitches

Firms jockeying for big assignment include JLL, Massey Knakal, Eastdil and Cushman

By Adam Pincus everal of the city’s top investment sales firms made their case last month to win the right to broker the sale of 1.5 million square feet of excess development rights as part of the larger Moynihan Station redevelopment plan, sources told The Real Deal.

The firms that initially responded to the request for proposals from New York State development agencies Empire State Development Corp. and Moynihan Station Development Corp. included Massey Knakal

S

be sold because the group of buyers would be expanded.

The bidding process only just began but was hit with controversy last month when City Council member Corey Johnson and Manhattan Borough President Gale Brewer complained that the bidding process has not been transparent enough.

The original deadline to submit a response to the request for proposals was March 6, but that was extended to March 20. Sources said it was extended to broaden interest in the process. The Real Estate

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Realty Services, Eastdil Secured, Jones Lang LaSalle, Cushman & Wakefield and a joint venture between two smaller firms, City Center Real Estate and Tenant Wise, the sources said.

At least three of these firms gave presentations in mid-April at the office of Empire State Development at 633 Third Avenue in front of a panel that included representatives from ESD, Moynihan Station Development and the Port Authority of New York and New Jersey, the insiders said.

Some estimated that only about 800,000 square feet, or a little more than half, of the excess development rights would be sellable, because of the limited number of so-called receiving sites that would be able to buy the air rights and build large buildings. Some insiders suggested the state should create a special district in which the air rights can be transferred, which would allow for more of the rights to

Board of New York sent out a note to members notifying them about the opportunity to market the air rights, according to the email reviewed by TRD. A spokesperson for Cushman declined to comment. City Center’s Robert Shapiro, Massey Knakal’s Robert Knakal and JLL’s Richard Baxter declined to comment, while a representative from Eastdil did not respond to a request for comment.

Some brokers said they expected the sale process to take years. The winning broker will be awarded a listing agreement with an initial term of two years, with three one-year extensions as options, according to the agency’s request for proposals.

The air rights sale is part of the process to expand Penn Station into the James A. Farley post office building located at 421 Eighth Avenue between 31st and 33rd streets. TRD www.TheRealDeal.com March 2010

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Retail

World Trade Center’s retail lineup revealed

With deadlines approaching and retailers grumbling about key design elements, TRD uncovers the most comprehensive list of likely tenants in mega-mall

A

By Adam Pincus s the city waits for the new World Trade Center development to open and begin pulsing with office workers, tourists and residents, big egos are clashing behind the scenes over what stores will occupy the massive retail complex.

Brokers told The Real Deal they expected Westfield Group’s 365,000-square-foot, multi-level mall in Lower Manhattan to be a success. But with deadlines nearing, the project is pushing to recruit more high-end tenants, even as some retailers have balked at being underground or expressed concern about a key design feature of the retail space.

The jewel of the massive retail project is a spiny, ethereallooking Santiago Calatrava–designed structure that will undoubtedly become an iconic addition to the Lower Manhattan landscape. The retail complex includes aboveground space, but the majority of the shopping will be below street level at the 16-acre site.

“I have heard some European retailers don’t want to be underground,” said Robert Gibson, a vice chairman at commercial firm JLL. Nevertheless, “I think it will be very successful.”

To help drum up interest among posh stores, Vogue editorin-chief Anna Wintour has reportedly been using her status as the grand dame of luxury fashion to convince designers to take space at the project. Sources told TRD that Wintour — whose parent company Condé Nast will be anchoring the office component of 1 World Trade Center — has been making calls and joining tours to convince retailers to sign on for space.

Vogue declined to comment.

Despite Wintour’s endorsement, insiders say that some high-end retailers are not biting.

Computer and iPhone giant Apple — which is expected to take space in the project — was frustrated by the giant “ribs,” or columns, that Calatrava included throughout the underground portion of the site. The arching structures are spaced roughly 11 feet apart along the front portion of each store, which has put off some retailers who want to use that space for signage, branding or product display, sources said.

Apple even sought a design variance, but was turned down, said one retail source, who asked not to be identified.

“Do you think [fashion designer] Karl Lagerfeld will be ok with playing second fiddle to an architect?” another retail insider said. “It is all about clashing egos. Those brands [that object to the columns] are not going to open a flagship Downtown and have Santiago Calatrava’s ribs obstructing the view.”

This month, TRD assembled the most comprehensiveto-date list of tenants expected to take space at the project.

We also obtained maps of the full retail complex indicating where retailers are likely to plant their flags.

Westfield has been involved in the center since it signed a 99-year lease in July 2001 to control what was then called the Mall at the World Trade Center (see related story on page 62). Analysts expect the new retail space to bring in $2,000 per square foot or more annually, well above the $900 per foot the predecessor mall took in, and putting it among the

60 May 2014 www.TheRealDeal.com

A rendering of the street-level retail for 4 World Trade Center, left, and 3 World Trade Center

To help drum up interest among posh stores, sources said Vogue editor-in-chief Anna Wintour has been using her status as the grand dame of luxury fashion to convince designers to take space at the project. top-grossing malls in the world.

While brokers said Westfield would not have a problem filling the space, questions remain about what type of tenant mix the project will ultimately achieve, and how much money it will generate for its owner. The firm is currently assembling what insiders say is a solid group of tenants. But so far, brokers said, it lacks the depth of luxury brands amassed by the neighboring Brookfield Place. Still, it remains to be seen how critical luxury tenants are for the project.

Ultimately, Westfield’s goal is for the mall to be “relevant” and a destination in the same way Soho is, said a person familiar with the marketing plans, who noted that the firm wants to draw New Yorkers, tourists and commuters into the complex.

In addition, some said, the tenants at the World Trade Center and at Brookfield Place may actually help one another.

“Collectively, [Westfield and Brookfield] have got to have a broad array of stores, and not every one is going to be a luxury brand. Not everyone can afford a Brioni suit,” said Richard Hodos, an executive vice president of retail at CBRE Group.

“The fact that Westfield is going to have some moderately priced tenants is not a bad thing.”

Scoping out stores Westfield, a public company, has said it expects to have 150 brands at the World Trade Center site mall.

TRD identified approximately 60 tenants that have signed leases, inked letters of intent or are in late negotiations with Westfield. In addition, the magazine also uncovered the location they’re expected to take in the project.

Westfield declined to comment or confirm any of the information, which came from industry insiders, who keep close tabs on who takes space so that they can get a feel for the mix of tenants, as well as from marketing plans created earlier this year and recently obtained by TRD. Sources say Westfield’s reluctance to talk is twofold — partly related to the fact that it’s a public company that is expected to announce its important information on earnings calls, and partly out of deference to the National September 11 Memorial & Museum, which is set to open this month.

The retail complex has four main shopping areas. The first is above ground in 3 World Trade and 4 World Trade along Church Street. But the heart of the retail complex will be Calatrava’s so-called “Oculus,” a two-level, oval-shaped shopping gallery. Two bi-level concourses, one dubbed the West Gallery, and the other called the South Gallery, will branch off of the Oculus.

As TRD reported last month, designer Tom Ford, jeweler Tiffany & Co., and one of the Giorgio Armani fashion brands are expected to take three of the project’s four street-level stores. Tom Ford is likely to take a two-level space in the base of 4 World Trade, and Tiffany and Armani are expected to take two-level locations in the base of 3 World Trade, next door.

All three sites have frontage on Church Street.

But some sources told TRD that not all retailers are comfortable with the non-World Trade Center tenants — including Burger King and discount clothing store Century 21 — that are near the project’s street-level space. While the neighborhood is rapidly changing, typically luxury brands

RETAIL

MAPPING OUT WTC’S RETAIL TENANTS The Real Deal compiled the most comprehensive public list of retail tenants expected to take space in the World Trade Center mega-mall, which is slated to open in 2015. The project’s owners, Westfield Group, declined to comment. But TRD obtained a preliminary merchandising plan drafted by the company earlier this year, and spoke to more than a dozen industry sources to cull together the list and map out where in the project those retailers are planning to plant their flags. Below is a look where you can expect to find stores from Apple to Hugo Boss.

UPPER LEVEL

UR

CH

ET

CH

S

RE

ST

Y SE

E TR

ET

VE

Cole Haan The Kooples Kate Spade Bobbi Brown J. Lindburg Zadig & Voltaire

Charles Tyrwhitt Moleskin LK Bennett Bose

ST RE ET

Duane Reade

L’Occitane Papyrus

FU LT ON

Nunu Chocolates Kusmi Kiehl’s

LOWER LEVEL

Disney Lego Victoria’s Secret Beauty Godiva Solstice Swarovski Aveda

Longines Montblanc Breitling Canali Dune Track & Field Pandora Bebe

Stuart Weitzman Hugo Boss John Varvatos Apple Michael Kors Épicerie Boulud

Tumi Asics Sephora Aritzia Organic Avenue Lacoste Victoria’s Secret

A rendering of the underground retail Oculus, or hub, showing architect Santiago Calatrava’s signature columns

do not want to be near brands outside of their peer group.

Most of the retail in the World Trade Center is below ground, where rents range from about $300 per foot in very large spaces in the branches to $500 for space in the Oculus. Brokers said rents a block away on Broadway have doubled over the past year, with ground-level deals now being completed for more than $500 per square foot.

As TRD reported last month, the shopping experience in the Oculus is likely to have more than a passing resemblance to the mix of stores in Soho. The space, which will have approximately 40 retail destinations, will include Kate Spade, Zadig & Voltaire, Cole Haan and Apple — all of which have Soho outposts.

Zadig & Voltaire said in a statement that it wanted to be part of the project because of its significance to both New York and the world. “Also, it is an emerging shopping area that, aside from Century 21, doesn’t have many other retailers, and the area has a lot of traffic with the tourists and the Financial District,” the company said.

In addition to Zadig & Voltaire and the aforementioned brands, the Oculus will also be home to the watchmaker Breitling, pen and watch manufacturer Montblanc (which closed its Soho store in 2011) and Swedish clothing designer the Kooples.

Meanwhile, Westfield is trying to give each area of the retail its own distinct personality.

In the South Gallery — which stretches for slightly longer than a 200-foot Manhattan street block before making a sharp turn to the east — Westfield is bringing together retailers that are at a lower price point than the Oculus tenants, but that still carry brand influence. On the lower level, that includes clothing maker Lacoste, cosmetics retailer Sephora, sneaker manufacturer Asics, luggage maker Tumi and Manhattan-based juice maker Organic Avenue. Also on this strip is Victoria’s Secret, which is expected to take one of the largest shops in the complex, with nearly 17,000 square feet.

The upper level of that branch has a greater focus on food and impulse purchases, with Brooklynbased chocolatier Nunu; the shoe designer Dune Group; skin-care retailer Kiehl’s and soap and lotion purveyor L’Occitane.

Meanwhile, the West Gallery (which heads toward West Street and connects to the underground entryway to Brookfield Place) also includes apparel and impulse-purchase retailers, as well as children stores. Sources said this area is completely leased up. On the lower level, which connects to the PATH trains, tenants are said to include Disney, Lego and Godiva.

Other tenants are the Victoria’s Secret cosmetics brand, sunglass chain Solstice and crystal gift-seller Swarovski. On the upper level, Duane Reade is expected to inhabit a more-than-6,000-squarefoot space.

Target practice The retail leasing process is almost always drawn out at malls because of the tricky interconnections among tenants, but insiders said the World Trade Center is even more complicated because the highprofile nature of the project that puts every detail under a microscope.

One of the first steps any mall takes is to create Continued on page 128

www.TheRealDeal.com May 2014 61

Retail

The WTC leasing posse

A look at the under-the-radar Westfield crew tasked with filling the country’s most high-profile mall with tenants before it opens its doors next year

I

By Adam Pincus n March, the Australian mall giant Westfield Group closed on its $1.4 billion purchase of the massive retail space at the World Trade Center.

Now the real estate investment trust’s New York City team is feverishly trying to lock in tenants for the few remaining vacancies before it opens next year — a high-stakes job at the most high-profile retail complex project in the country.

Insiders said that the 365,000 square feet of store space within the multi-story mall is at about 70 percent leased or in advanced negotiations (see related story on page 60.)

But while retail brokers and executives at stores taking space in the Trade Center know Westfield’s core group of local players, to most of the industry they remain something of a mystery.

This month, The Real Deal looked at just who’s running the show there. While Westfield declined to comment, industry sources helped to fill in the blanks.

In Manhattan, the Trade Center leasing group is led by

Australian David Ruddick, who is on the firm’s global leasing committee and has managed some of the company’s largest projects internationally in recent years, including in Brazil.

Other top executives on the team, which operates out of a 5,300-square-foot space on the 37th floor of 7 World Trade Center, include: David Weinert, Ron Bondy, and Rachel Belam.

Weinert, a senior executive vice president of leasing in the Americas for Westfield, joined the firm in 2013 after a 26-year stint with rival Taubman Centers. Insiders said he is a classic salesman. “He could sell you the Brooklyn Bridge,”

to deals elsewhere. While that is a common practice in New York and in the broader mall-leasing world, some brokers gripe that it’s unfair.

Bondy, meanwhile, focuses on nonfood retailers, ranging from electronics David Ruddick to apparel. He joined Westfield in 2010 after more than two decades at mall REIT, Macerich.

For her part, Belam is the Trade Center’s top food broker.

She came to New York after coordinating food at Westfield London and Westfield Stratford, the malls that had the third and fourth highest revenue per square foot in the world,respectively, figures from the International Council of Shopping Centers showed. Sources say she’s assembling a roster of restaurants and markets that is likely to include a version of the celebrity chef Mario Batali’s popular Italian bazaar Eataly.

But Westfield has not been able to retain all of its brokers throughout the Trade Center lease-up. South Street Seaport developer Howard Hughes Corp. recently poached both New York–based Brent Habeck and Californiabased Jonathan Lauren. Sources said while Lauren was not in New York, Westfield could have tried to recruit him to its Trade Center team rather than allowing him to head to Howard Hughes. Prior to leaving, Habeck was the go-to person for fashion tenants, several brokers said.

The Westfield team does have some serious competition on its hands. Directly across the street, Brookfield Office Properties has nearly finished leasing up its renovated Brookfield Place mall, which insiders said had an edge on the Trade Center at attracting super-luxury tenants. That operation is being headed

by Edward Hogan, a New York retail veteran.

But while Westfield’s brokers are (relatively) new to the New York retail scene, the company is a powerful player locally. In addition to the Trade Center, it recently won the right to manage the nearby Fulton Center.

That will add to the more than 90 malls it controls in the U.S., United Kingdom, Australia and New Zealand, valued at more than $65 billion.

The company has been invested in the Lower Manhattan project for more than a decade. It bought a stake in the Trade Center in July 2001, just months before the terrorist attacks. It had just signed a 99-year lease with the Port Authority for the retail complex, then called the Mall at the World Trade Center.

When Westfield took over leasing back in 2001, the 427,000-square-foot shopping center was about 73 percent leased, and was expected to pull in about $45 million in annual rental revenue. It was a bonanza for retailers, bringing in nearly $900 per square foot in sales annually, among the highest in the country at the time. Today, the mall is expected to double or triple the sales per square foot numbers, as well as rental revenue. Analysts estimate the complex could generate sales of $2,000 to $3,000 per foot for retailers, and bring Westfield $120 million or more in annual rent revenue. TRD

While retail brokers and store executives taking space in the WTC know Westfield’s core group of local players, to most of the industry they are something of a mystery. one broker said. Others said Weinert leverages his national contacts to help structure leasing deals at the Trade Center, and has been known to lean on retailers to sign on for space in the Lower Manhattan mega-project in exchange for agreeing

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Retail

Super stores

T

By Adam Pincus he crush of tourists — often standing five deep at crosswalks in Times Square, Herald Square and on Fifth Avenue — may be frustrating to New Yorkers trying to get from point A to B, but the money they’re dropping in the city is buoying the retail in those areas and pushing rents increasingly higher.

This month, as many in the New York City retail world are preparing to head to Las Vegas for the annual ICSC retail conference RECon, The Real Deal ranked the top 20 highest-grossing retail properties in Manhattan and looked at which owners are raking in the most money from among those top-grossing assets.

To do so, we used data from the research firm Genesis Computer Consultants, which compiles information from property income and expense filings with the city, as well as from news reports and industry sources.

The ranking found that retail investor Jeff Sutton, either alone or in partnership with SL Green Realty, took in the most overall retail rental revenue within those top properties, with five assets raking in a combined $125 million. He was followed by Vornado Realty Trust, which

has five properties producing $111 million annually.

Meanwhile, for individual properties, Rockefeller Center, the GM Building, a collection of Fifth Avenue buildings, and the Time Warner Center led the pack. (The ranking counted properties that were part of a mall as well as adjacent properties owned by the same landlord, as single properties.)

The large square footage that the city’s top retail players own, especially when concentrated in a single building or neighborhood, gives them enormous leverage to cherry-pick tenants and determine the future of each shopping destination.

“These guys are all, in a way, pioneers,” said Robin Abrams, an executive vice president at the retail-focused brokerage Lansco. “They had the vision and they understand retail.”

While tenants may complain about the astronomical rent increases that these property owners sometimes demand, those who own large blocks of retail space have a competitive advantage when it comes to achieving higher rental rates. That’s because they often own key properties in high-demand areas of the city and tenants have limited options of

A ranking of the highest-grossing retail buildings in Manhattan — and a look at the landlords who profit from them

Rockefeller Center, the high-grossing retail property in Manhattan

other owners to sign on with.

“You can make a market by controlling big chunks of it,” explained Robert Futterman, CEO of the retail brokerage RKF. His firm represents landlords such as Silverstein Properties, Extell Development and Milstein Properties.

In addition, controlling large blocks of retail space can be used to very precisely coordinate — or “curate,” as retail insiders say — certain types of tenants, in turn

increasing the value of rents.

“If you have a one-off [tenant] with [retail] neighbors that are not synergistic, it can devalue the building,” Abrams said.

On the other hand, the sky-high revenue that those landlords are bringing in may come as a form of incentive for owners of underperforming properties nearby, said investment sales broker Adelaide Polsinelli, of Eastern Consolidated.

Continued on page 66

What Manhattan’s top-producing retail sites earn for their owners Rank

Property

ANNUAL revenue

Owner(s)

Tenant(s)

Square feet

1

Rockfeller Center

$96 million

Tishman Speyer

Banana Republic, Ann Taylor, Cole Haan, others

764,138

2

General Motors Building (767 Fifth Ave. )

$34.4 million

Boston Properties, Zhang Xin, Safra family

Apple, FAO Schwarz, Cartier

86,352

3

717 Fifth Avenue (retail condo)

$34.3 million

Jeff Sutton, SL Green Realty

Giorgio Armani, Dolce & Gabbana, others

80,834

4

720-724 Fifth Avenue

$33 million

Jeff Sutton, SL Green Realty

Abercrombie & Fitch, Prada

35,000

5

Trump Tower (725 Fifth Ave. and 4 E. 57th St.)

$32 million

Trump Organization

Gucci, Nike

81,617

6

Shops at Columbus Circle (retail condo)

$31 million

Related Companies, AREA Property Partners

Whole Foods, Equinox, Armani/Exchange, others

343,000

7

666 Fifth Avenue (retail condo)

$30 million

Vornado Realty Trust, Kushner Companies

Uniqlo, Swatch, Hollister

114,000

8

1 Beacon Court (151 E. 58th St.)

$25 million

Vornado Realty Trust

Home Depot

160,000

9

2 Herald Square (1302 Broadway)

$24 million

Sitt Asset Management

Victoria’s Secret, H&M

100,000

10

660 Madison Avenue

$22 million

Aurora Capital Associates, Jenel Management

Barneys

275,971

11

1 Union Square South (842 Broadway)

$21.6 million

Related Companies, Ohio Teachers

Regal Cinemas, Best Buy, Duane Reade, others

240,000

12

East River Plaza (505 E. 116th St.)

$21.2 million

Forest City Ratner

Costco, Target, Best Buy, Old Navy, others

527,000

13

Manhattan Mall (1275 Broadway)

$21.1 million

Vornado Realty Trust

JC Penny,Toys R Us, Starbucks, others

156,078

14

1552 Broadway

$20 million

Jeff Sutton, SL Green Realty

Express, McDonald’s

30,000

15

1515 Broadway

$19 million

Jeff Sutton

Aeropostale, Juniors, Billabong

173,145

16

1 Penn Plaza (206-268 W. 34th St.)

$18.4 million

Vornado Realty Trust

Kmart, Starbucks, Famous Footwear

216,912

17

1551 Broadway

$18 million

Jeff Sutton, SL Green Realty

American Eagle Outfitters

15,450

18

1530 Broadway

$17.1 million

Bow Tie Partners (Moss family)

Swatch, Footlocker, Toys R Us

114,000

19

1540 Broadway

$17 million

Vornado Realty Trust

Disney Store, Forever 21, Planet Hollywood, others

300,937

20

693 Fifth Avenue

$16 million

Thor Equities

Valentino

36,442

Source: Annual retail revenue figures in gray are from The Real Deal’s analysis of data from research firm Genesis Computer Consultants. Figures in red boxes are from industry sources.

64 May 2014 www.TheRealDeal.com

www.TheRealDeal.com January 2011 25

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Retail Continued from page 64

“The guy sitting next door maybe says, ‘I can do that,’ and will dust off the cobwebs of the old building” to try and reposition it, Polsinelli said.

Rolling in revenue The New York City retail sector has never been stronger. Leases are setting records, retail condos are at the top of many investors’ wish lists, and new mega-store complexes are coming down the pike.

Compared to office leasing, the value of retail has exploded in recent decades. Average Midtown office rents have grown by only about 90 percent in the last 30 years, from roughly $35 per square foot in 1984 to $65 per square foot last quarter. But during that same time, retail rents on Upper Fifth Avenue have grown nearly 700 percent from highs of $450 per foot in 1984 to about $3,500 per foot this year, according to news reports from both time periods.

Brokers caution that there has been some pushback from tenants, and say some landlords are scaling back their high asking rents because deals are taking longer to get done.

“I think the market is very strong,” said Robert Gibson, a vice chairman with commercial firm JLL. “[Yet] people are being more careful. Retailers are just making sure. They want to come into the New York market and be successful.

If they can’t, they will wait until [pricing] comes down.”

On the ranking front, Rockefeller Center, the 22-acre complex in Midtown owned by Tishman Speyer, came in as the highest-grossing retail property on TRD’s list, with roughly $96 million in gross retail revenue annually, the Genesis figures show.

The 764,138 square feet of retail space above and below ground houses more than 100 retailers, including Banana Republic, Cole Haan, Michael Kors and Anthropologie. Rents at the massive complex vary from about $100 a square foot underground to about $2,000 per square foot for prime, ground-floor space on Fifth Avenue.

Manhattan’s second-highest-grossing retail property is the General Motors Building, which rakes in $34.4 million. The Fifth Avenue tower, which is owned by Boston Properties, includes the iconic glass-cubed Apple store with 22,500 square feet, as well as toy store FAO Schwarz, which has a lease running through 2017, though it recently put the roughly 61,000-square-foot multi-floor space on the sublease market. The high-end jeweler Cartier also leases an 8,000-square-foot space on the north side of the 50-story building on a temporary basis that could be made permanent, according to news reports from last month.

Clocking in at No. 3 on the ranking is

66 May 2014 www.TheRealDeal.com

an 80,834-square-foot retail condo unit, owned by Sutton and SL Green, at 717 Fifth Avenue. Tenants in the 56th Street space include Armani, Dolce & Gabbana and Oxxford Clothes.

The same two partners also nabbed the No. 4 spot on the ranking with 720

Circle, that’s part of the residential, hotel and retail Time Warner Center on the southwest corner of Central Park. The interior mall, which is located at 10 Columbus Circle and owned by the Related Companies, has about 350,000 square feet of retail space, which is structured

anne Podell, vice chairman at Cushman & Wakefield, noting that Fifth Avenue retail commands much higher rents.

Other notable owners on the top 20 list include Sitt Asset Management, which owns 2 Herald Square, with tenants including H&M and Victoria’s Secret. That space brings in about $24 million per year for its owners. In addition, Forest City Ratner’s East River Plaza, a 527,000-square-foot mall in East Harlem, brings in just over $21 million per year.

More competition coming

The retail at the Time Warner Center brings in $31 million a year for its owners.

Marc Holliday of SL Green

Steven Roth of Vornado

Mort Zuckerman of Boston Properties

The Apple store at the GM Building

Fifth Avenue and the adjacent 724 Fifth Avenue, both diagonally across the street from 717 Fifth. (The two buildings are occupied by Abercrombie & Fitch, and Prada, respectively.) Combined, the two buildings, with about 35,000 square feet of retail, bring in $33 million annually.

Rounding out the top five were two adjacent properties owned by the Trump Organization, Trump Tower at 725 Fifth Avenue and the Nike store at 4 East 57th Street, which brought in a combined $32 million through a total of more than 81,000 square feet.

Just below that was one of several malls on the list, the Shops at Columbus

as a single commercial condo unit. It has more than 40 tenants, including Whole Foods, Hugo Boss, Coach, J.Crew and Thomas Keller’s Michelin-rated restaurant Per Se. All together, the retail brings in a total of $31 million per year.

While it might seem counterintuitive that the Time Warner Center’s 40 tenants bring in less than the two tenants — Abercrombie & Fitch and Prada — in the No. 4 spot, insiders said that the Fifth Avenue addresses carry far more cachet.

Some said the two types of retail shouldn’t even be compared. “A vertical shopping center versus pure street retail — they are completely different,” said Jo-

While all of these high-rent retail buildings and malls are soaring now, they will have new competition on their hands soon. That’s because four massive and highly publicized malls are slated to hit the market in the next few years, and large retail spaces on Fifth Avenue and in Times Square are getting rehabilitated.

Among those multi-story projects are the World Trade Center retail complex, which is owned by the Australian real estate investment trust Westfield Group (see related story on page 60). That site is expected to blow all others out of the water when it comes to gross revenue, which some anticipate could hit $120 million.

The complex — which will be mostly underground, but also at-grade and above-ground — will initially be built at 365,000 square feet, but an additional 90,000 square feet will be added when 2 World Trade Center is developed.

Meanwhile, just across the street, Brookfield Office Properties’ Brookfield Place has undergone a $250 million renovation. The 200,000-square-foot retail space is scheduled to open next year, and to have a higher concentration of luxury tenants, including Salvatore Ferragamo, Hermès and Burberry.

Two other large malls are expected to be completed in the coming years: They are the Howard Hughes Corp.’s South Street Seaport in Lower Manhattan, which is under redevelopment, and the 1 million-square-foot retail complex at the Hudson Yards site, which is being developed by Related.

In addition, there are buildings being rehabbed that are expected to generate more than $15 million per year for their owners. They include Vornado’s 640 Fifth Avenue and 1535 Broadway, and a project co-owned by Sutton, Joe Sitt, Aurora Capital Associates and the Adjmi family at 529 Broadway in Soho.

All these new projects will greatly increase the number of existing properties that rake in serious cash annually.

“Each of these deals is instrumental in creating spillover value for neighboring properties,” Polsinelli said. “As they draw in more shoppers to these locations, other national brands and retailers will want to participate, thereby increasing the value and desirability of the area.” TRD

www.TheRealDeal.com December 2012 47

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Retail

NYC retail world preps for Sin City Brokers to head en masse to Vegas for annual ICSC mega-conference, but say scheduling shift is throwing off the crucial party circuit

T

By Adam Pincus he New York City retail world is preparing to head en masse to Sin City for the largest annual international retail trade conference later this month.

The gathering, a must-attend for any top retail player in the country, is expected to draw even bigger crowds this year than last for its three-day event, which runs from May 18 to May 20.

Conference officials are expecting more than 33,000 people to attend, up from about 32,700 last year.

And New York City firms are sending more people than they have in the past.

For example, Massey Knakal Realty Services is flying out about 30 people this year,

pool, when brokers and clients could hammer out deals in a relaxed environment far from New York City’s hustle and bustle. Monday night was often devoted to Newmark’s annual bash at the Cosmopolitan, with the unofficial wrap-up on Tuesday at the New York Developers Party, held poolside at the Bellagio.

But now all of that, plus the dozens of other parties hosted by New York and other retailer players, is getting squeezed into a tighter time line.

With the event opening on Sunday and closing at the end of the day Tuesday, there is simply less time, sources said. As a result, this year the New York Developers Party has been shifted to Monday night, and will go head-to-head with Newmark’s bash.

In addition to the main ICSC conference, some brokers will have to squeeze in time to stop by a sister event that giant mall operators Macerich, Simon Property and Westfield Group are hosting in Caesar’s Palace on the Las Vegas Strip. Typically brokers who do business with those large companies spend a day at that hotel, hopping from one company to another.

One broker, who asked not to be identified, described the ICSC scheduling change this way: “It has fucked everybody up.”

Others had a less negative take, but said the shift would have a significant impact.

“I kind of like the fact that it is starting on

Left: Newmark Grubb Knight Frank’s Jason Pruger, left, and Jeffrey Roseman on the convention floor in 2013. Right: Cushman & Wakefield’s Joanne Podell, left, and Sonia Bain of the law firm Bryan Cave at a poolside party at the Four Season’s last year.

said Todd Korren, an executive managing director at the firm. That’s up from the 23 Massey Knakal employees that attended last year, according to International Council of Shopping Centers ICSC figures.

In addition, national chains are sending bigger groups, said Jeffrey Roseman, a principal with Newmark Grubb Knight Frank Retail. Roseman said in previous years only top real estate executives attended the event, but now companies are sending more junior associates, too.

Brokers say the RECon conference —which is held at the Las Vegas Convention Center and features more than 1,000 exhibitors, including landlords, brokerages, retailers and other players — is invaluable.

But many who are attending this year’s conference griped to TRD last month about a one-day calendar shift that’s having a Domino effect on the party-circuit schedule, and harped on the fact that the event has been shortened to three days from four.

Landlords, brokerages, law firms, lenders and other party-throwers (and goers) are concerned because this year the main hall opens on Sunday, rather than on Monday, and closes on Tuesday rather than Wednesday. While that change might seem like small potatoes, it means attendees will be diving into the official events earlier, and will have less pre-event weekend time to kick off the parties, which are crucial networking opportunities where key business relationships are often firmed up.

Insiders say that New York deal-making has traditionally started with poolside parties on Saturday, including one hosted by developer Thor Equities, and another by brokerage Winick Realty Group. Sunday, meanwhile, was typically a slower day by the 68 May 2014 www.TheRealDeal.com

Left: Carlton Group’s Howard Michaels, left, and HFZ Capital’s Ziel Feldman at last year’s convention.

Right: Lansco’s Lisa Rosenthal, left, Alan Victor and Robin Abrams at an ICSC party last year.

Sunday this year,” said Lisa Rosenthal, a managing director at the retail brokerage Lansco.

Nevertheless, “for those people who like to have their more informal meetings by the pool on Sunday, they are going to have to cram them all into Saturday. Everyone has formal appointments on Sunday.”

Jesse Tron, an ICSC spokesperson, said the conference was changed for “logistical and cost reasons,” and noted that the event also started on a Sunday in 2011.

“When the show [started] on Monday, we [had] to pay union labor time-and-a-half for the Sunday set-up,” he said.

This year, sources said, a potential rise in interest rates in properties that were purchased at peak figures could serve as an informal deadline to ink deals at the show.

“Vacancies must be filled as quickly as possible, at peak rents, before a potential big hiccup occurs in the market as interest rates rise over the following 12 months,” said Jared Epstein, a vice president with the landlord Aurora Capital Associates.

“Rising rates will likely change everything, including shopping habits,” added Epstein, who will be attending the event. “Now is the time to seize, and RECon in Vegas is one of the best opportunities to do so.” TRD www.TheRealDeal.com May 2014 51

T HEOL RDAT APL AT F ORM I ST HEMOS TWI DE L YUS E D L I S T I NGSRE S OURCEF ORRE S I DE NT I ALBROKE RAGEF I RMSI NNY C.

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TOWN Residential LLC is a partnership with Buttonwood Residential Brokerage, LLC and Thor Equities, LLC. No representation is made as to the accuracy of any description. This is not intended to solicit property already listed. The number of bedrooms listed above is not a legal conclusion. Each person should consult with his/her own attorney, architect or zoning expert to make a determination as to the number of rooms in the unit that may be legally used as a bedroom. TOWN Residential LLC is a licensed real estate broker, proud member of REBNY, abides by federal and state equal housing opportunity laws and owns the following subsidiary licensed real estate brokers: TOWN Astor Place LLC; TOWN Fifth Avenue LLC; TOWN Flatiron LLC; TOWN Gramercy Park LLC (“TOWN Gramercy”); TOWN Greenwich Street LLC (“TOWN Financial District”); TOWN Greenwich Village LLC; TOWN Soho LLC; TOWN West Village LLC; and TOWN 79th Street LLC (“TOWN Upper East Side”).

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88 Greenwich Street 212.269.8888

446 West 14th Street 212.604.0300

33 Irving Place 212.557.6500

TOWN Residential LLC is a partnership with Buttonwood Residential Brokerage, LLC and Thor Equities, LLC. No representation is made as to the accuracy of any description. This is not intended to solicit property already listed. The number of bedrooms listed above is not a legal conclusion. Each person should consult with his/her own attorney, architect or zoning expert to make a determination as to the number of rooms in the unit that may be legally used as a bedroom. TOWN Residential LLC is a licensed real estate broker, proud member of REBNY, abides by federal and state equal housing opportunity laws and owns the following subsidiary licensed real estate brokers: TOWN Astor Place LLC; TOWN Fifth Avenue LLC; TOWN Flatiron LLC; TOWN Gramercy Park LLC (“TOWN Gramercy”); TOWN Greenwich Street LLC (“TOWN Financial District”); TOWN Greenwich Village LLC; TOWN Soho LLC; TOWN West Village LLC; and TOWN 79th Street LLC (“TOWN Upper East Side”).

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RESIDENTIAL

or Stop signS

greeN

lights?

A look at the key issues industry players are watching to see whether the NYC residential market is headed for doom or more boom

I

By Janna Herron t isn’t just all those new residential towers that are reaching for the sky. The average sales price for a Manhattan apartment soared almost 31 percent higher in the first quarter, compared with the first three months of 2013.

While that’s good news for anyone who recently sold a residential property, those looking to sell in the near future may be feeling antsy over whether the good times can keep on rolling.

Factors like low inventory, rising land prices and strong buyer demand suggest that prices could climb even higher

and sales could continue apace.

But some in the industry are wondering how long this heated residential climate can last.

As industry experts attempt to read the real estate tea leaves, some say they are beginning to see troubling trends in the residential market, problems that could foreshadow a softening.

Others say they don’t see any end to the current market surge in sight.

Read on to see which issues the experts identified as the most indicative of which way the market winds will blow in the coming months.

Developer anxiety?

developers marketing properties as soon as a project is

at tomorrow’s higher prices. “But developers are thinking

While it may seem that everything is going

approved. That suggests that developers would rather

that there is no advantage to waiting,” she said.

strong when it comes to the construction of

ink sales at today’s prices, when they know the market is

Developers are also changing their strategies to sell

new residential projects in New York, some developers

strong. If they truly thought New York City prices would

their projects. Andy Gerringer, managing director at the

Stop

are starting to show jitters. Often seen as ever-optimistic, developers are beginning to hedge their bets and are displaying more urgency in selling their new developments

“Our office is getting calls from developers regarding their sites, asking if we have clients to bring over.

Certainly, those are signs we haven’t seen before.”

than before.

Andy Gerringer, the Marketing Directors

Marketing Directors, a new development marketing firm, said that several developers have switched from using in-house brokers to hiring outside agents. Both Macklowe Properties, which brought in Douglas Elliman at 432 Park

Nancy Packes, owner of Nancy Packes Inc. Signature Marketing Services, a sales bro-

continue rising, Packes said, they would wait to start sales

Avenue, and Related Companies, which is collaborating

kerage for new developments, said she is seeing more

once their buildings were finished, when they could sell

with Corcoran Sunshine on the residential units at Hudson

72 May 2014 www.TheRealDeal.com

RESIDENTIAL Yards, have done so. “If things are going swimmingly, you

few years, as lenders abide by new mortgage rules that

percent in the first quarter

don’t have to switch anything out,” Gerringer said.

kicked in this year.

from a year ago, even as

He is also seeing developers take roadshows abroad to

Tight credit is prompting would-be sellers to hold back

the median sales price edged

promote buildings to potential buyers, a move he said is

on listing their apartments, because they won’t qualify for

up 1 percent, according to a

a change from the past, when foreign buyers would come

a mortgage to trade up, said Miller, adding that the issue

report from Miller. Compared

here. “Before, they were coming here, and you didn’t have

with 2013’s fourth quar-

to do a roadshow,” he said.

ter, the changes were more

In other instances, developers are calling bro-

dramatic. Sales volume fell

kerage firms to drum up business, he said. “Our of-

10.3 percent, and the median

fice is getting calls from developers regarding their

sales price slid 8.8 percent.

sites, asking if we have clients to bring over,” he said.

Yet most brokers

“Certainly, those are signs we haven’t seen before.”

blame the lack of invento-

Stop

ry for the drop in sales. Listing

“Crazier than 2007”

inventory was down year-over-

The market seems to be too good to be true, at least for sellers. The low inventory is, of

year and quarter-over-quarter, Dan Fasulo, Real Capital Analytics

course, causing a ruckus among buyers: Above-asking offers, bidding wars, contingency waivers and all-cash deals.

according to Miller’s report.

“If a broker didn’t have a good first quarter,

176 East 64th Street, which recently sold for $15.8 million

And many buyers are left out, frustrated by the market.

it’s because they didn’t have any inventory to sell,” said Karen Heyman, a top-producing

“There are definitely many stories from potential buy-

broker in Brooklyn for Sotheby’s. “There

ers bidding above the asking price on multiple apartments

isn’t a lot of product.”

and not getting anything,” said Doug Perlson, founder and

Heyman also noted that some sales con-

CEO of RealDirect, a brokerage firm with a web-based

tracts on new developments won’t close until

listing and marketing platform. “That’s the biggest red

next year or even 2016, when the projects

flag and the most problematic.”

are done, meaning that recent deals may

Noah Rosenblatt, founder and publisher of UrbanDigs.

not be getting counted yet.

com, a real estate analytics and consulting firm as well as a

One reason for the low inventory levels

brokerage, noted that some of his clients are walking away

is that the market is still feeling the effects

from the market and renting for a year before trying again

of the commercial credit crunch during

(see related story on page 26). Others simply are overbidding

the recession. Although there is a lot of

to win properties. And sellers aren’t making it any easier.

new residential development underway

“For almost seven out of 10 deals, having a financing

in both Manhattan and Brooklyn, devel-

contingency is a non-starter. Sellers won’t even look at it,”

opers haven’t been able to keep pace with

he said. “This is a crazier market than in 2007.”

demand because new construction came

How long can prices keep going up? As long as New

to a near-standstill after financing dried

Yorkers have incomes to pay higher asking prices, said

up in 2008, said Packes. The spigot is open

Dan Fasulo, managing director of Real Capital Analytics.

now, but developers are a few steps behind

In other words, not forever.

the demand.

Nancy Packes

“It is safe to say that it’s not sustainable for New York to continuously get double-digit increases in values,” said Fasulo. “The law of big numbers will hit you in the head

In addition, some argue that the “polar vortex” may be to blame for the recent soft-

is helping to keep inventory artificially low.

ening in the Brooklyn numbers. David Maundrell, founder

“When you’re not seeing a lot of new properties com-

and president of Aptsandlofts.com, a residential broker-

ing on the market, it’s a potential turn-off for buyers

age that focuses on Brooklyn and Long Island City, said

and creates a surge in prices. Some buyers will step up

since the weather has warmed up, new listings are starting

Loose credit was largely to blame for the

and pay what they need to pay to win a bidding war,

to hit the market and open-house traffic is going strong.

market crash last time around; this time, it

while others will sit it out,” said RealDirect’s Perlson.

could be just the opposite phenomenon that constrains

“That’s our biggest concern and what we watch closely.”

sometime.”

Stop

The credit clamp

the market. Banks, of course, clamped down on residential lending in the aftermath of the 2008 financial collapse, and while things have eased, it’s no secret that it’s still not easy to secure a mortgage.

Warning signs Stop in Brooklyn

No Russian retreat Just as Russian President Vladimir Putin refuses to retreat from Crimea, Russian homebuyers in New York are sticking with the city’s condo

Miller said that when he’s gauging whether

market despite escalating tension between the U.S. and

“The whole financing scene has changed. You have

instability is looming in the market, he looks to see wheth-

Russia over the latter’s interference in Ukraine, sources

really tight credit,” said Dottie Herman, CEO of Douglas

er there’s a “sharp decline in sales activity while prices are

said. Leaving aside reports that Russian billionaire Roman

Elliman. “People have to put more money down to get fi-

rising rapidly.” When that happens, it’s a sign of pending

Abramovich is scaling back his search for a trophy New

nancing. That’s why we’ve had mostly cash deals.”

trouble because prices will eventually follow sales activity.

York property after his $75 million purchase at 828 Fifth

According to the Federal Reserve’s most recent lend-

In Brooklyn, the numbers have been heading in that

Avenue was put on hold because of a dispute with the seller,

er survey, bank standards are still tight, and fewer peo-

direction. While prices in the borough continued to climb

ple are looking to apply for home loans. Miller said he

recently, albeit only slightly, the number of transactions

“We just closed a deal with a Russian couple last week,”

expects credit requirements to remain strict for the next

fell. The total number of sales in Brooklyn dropped 2.2

said Elizabeth Lee Sample, a top broker with Sotheby’s

the majority of Russian buyers are still as active as ever.

www.TheRealDeal.com May 2014 73

RESIDENTIAL International Realty who works with many Russian buy-

sent panic through the high-end New York City residential

when both Bear Stearns and Lehman Brothers collapsed,

ers. Sample said she spoke to one client from Moscow about

brokerage community. But these days every retrenchment

last year’s Wall Street bonuses were at their highest level

Crimea and “his attitude was that the Ukraine is part of Rus-

in stocks seems to be followed by a rally.

since the financial meltdown. Clocking in at an average of

sia, so some of this is expected from their eyes.”

Wealthy Russians have, of course, been buying some of the

While the Standard and Poor’s 500 dropped 2.1 percent

$164,530 — the third highest on record — the bonus level

last month, for example, the broad stock market index

represented a 15 percent increase over 2012, according to

city’s priciest luxury condos, and, in turn, helping to push up

the comptroller’s estimates.

22 River Terrace is one of few rental-to-condo conversions.

prices. Most notably, in 2011, Russian billionaire Dmitry Ry-

At the same time, the city is diversifying its economy and

bolovlev bought an $88 million penthouse at 15 Central Park

moving away from its dependence on Wall Street, most no-

West from former Citigroup chairman Sandy Weill, shattering

tably in the technology sector. Employment in the industry

records and garnering international headlines in the process.

has jumped 21 percent since 2006, to about 150,000 work-

“Clients continue to ask about new projects. There is still

ers, according to the Partnership for New York City, which

significant interest in the very high-end projects,” said Ed

represents large businesses.

Mermelstein, a real estate attorney who also works with many

“We’re seeing a robust job market, which is always good

Russian buyers. “They want to be the first ones in. That hasn’t

for real estate, with the new tech sector adding well-paid

changed in any way.”

jobs to the city economy,” said RealDirect’s Perlson.

Mermelstein also noted that there is an increased interest

And while tech growth is getting the headlines, New York

among many Russian buyers to acquire residences worth $10

is also seeing gains in other high-paying fields, including jobs

million or less in New York, which are easier to rent. Still oth-

in hospitals, which increased nearly 3 percent in the past

ers are considering selling their assets, not because of political

year, according to the state Department of Labor.

reasons, but to capitalize on rising prices in the market, he said.

Pricey melting pot

Buying still better than renting

Forget wealthy Russians. The New York City market

Another positive sign for the residential sales mar-

is, of course, flooded with a world of other interna-

ket is that the rent-versus-buy scenario still favors pur-

tional millionaires and billionaires who want to own

chases. Simply put, that is a sign that demand in the sales

a piece of New York real estate.

market is healthy.

“Compared with other international markets like Hong

One of the reasons for that is that rental prices in New

Kong and London, it’s still very affordable to buy here,” said

York remain high, especially for desirable properties, said

Dylan Pichulik, CEO of XL Real Property Management.

Perlson.

“We’re seeing a lot of activity from investors from the Ukraine

Trulia’s “Rent vs. Buy” index, released in February, showed

and Venezuela who are scared of what is happening in their

Noah Rosenblatt

home countries and want to put their money in assets that

This apartment at 1016 Fifth Avenue recently sold for nearly $7 million.

are protected.”

Others back up that point. New York ranked No. 2 for top

that it is 22 percent cheaper to buy than rent in New York.

The index also noted that rates on a 30-year fixed mortgage would have to reach 7.2 percent, up 2.8 percentage points from where they are now, to tip the scales in favor of renting.

global cities for foreign investment, according to a survey of

That may seem counter-intuitive, given the eye-popping

foreign investors from the Association of Foreign Investors

numbers that high-profile luxury properties command. But

in Real Estate.

for more typical homes, the calculus still works out in favor

Not only are foreign investors buying high-end trophy

of purchases, helping to drive demand for residential sales.

properties, which they’ve been doing for a long time, but now

That demand is evident from the frenetic pace of sales.

they are also “going into secondary or tertiary markets and

Even with historically low inventory leaving prospective

buying into Gowanus, South Williamsburg and Harlem,”

buyers with fewer choices, Miller’s first-quarter report

Pichulik said.

showed the number of sales in Manhattan rose 35 percent

Then, there are the Chinese, such as the woman who paid

rebounded from that loss and is again trading near record

from the same period in 2013, while the average time on

$6.5 million last year for a unit at the unfinished One57 in Mid-

highs, following a 30 percent leap in 2013, the biggest gain

the market dropped by 17 days.

town for her two-year-old daughter. The interesting market

since 1997.

twist is that Chinese lenders are

The relatively small amount of rental-to-condo conver-

those units are being sold back

“It is safe to say that it’s not sustainable for New York to continuously get double-digit increases in values. The law of big numbers will hit you in the head sometime.”

to individual Chinese investors,

Dan Fasulo, Real Capital Analytics

also financing the construction of a number of large New York condo projects, and, in return,

product that way,” she said.

Wall Street to Silicon Alley

as a positive sign for the sales market. Right now, Real Capital’s Fasulo is seeing just a “trickle” of properties sold for conversion from rent to con-

said Packes.

“The [developers] get rid of a tremendous amount of

sions can also be interpreted

do, such as the Wellington at “The stock market is not going down,” said Rosenblatt.

200 East 62nd Street, 88 Lexington Avenue and 22 Riv-

“Every time it goes down, it comes right back and makes

er Terrace, whereas the pace was much faster before the

new highs.”

housing bubble burst.

That strength helps the New York residential mar-

A mass wave of condo conversions would indicate that

ket, since the financial industry employs an impressive

“condo prices have gotten to the point where converters are

Not long ago, any dip in the stock market — like

165,000 workers in the city, according to the state comp-

willing to pay more for a property than an owner,” he said.

the one that took place last month — would have

troller. While that’s 13 percent fewer workers than in 2008,

“Developers are always looking for market inefficiency.” TRD

74 May 2014 www.TheRealDeal.com

MASSEY KNAKAL

Massey Knakal is NYC’s

#1 Building Sales Firm for the 13th Consecutive Year TM

Every Building. Every Detail.TM

# Transactions ’01-’13

MASSEY KNAKAL REALTY SERVICES

3,153

Marcus & Millichap Besen & Associates, Inc. GFI Capital Resources Group, Inc. Eastern Consolidated Rosewood Realty Group Newmark Grubb Knight Frank CBRE Capin & Associates The Corcoran Group Cushman & Wakefield Prudential Douglas Elliman Eastdil Secured Itzhaki Properties Greiner-Maltz Company, Inc. Lee Odell Real Estate, Inc. Kalmon Dolgin Affiliates, Inc. Terra CRG Sholom & Zuckerbrot Realty Corp.

Douglas Elliman Ariel Property Advisors Swig Equities, LLC Solar Realty Management Corp.

Friedman-Roth Realty Corp.

Jones Lang LaSalle Extreme Realty HFF WRA Properties Corporate Offices Pinnacle Realty of New York, LLC GVA Williams Weissman Realty Group, LLC CPEX Real Estate John Anthony Group, Inc. NAI Global Time Equities, Inc. Total Transaction Volume (Brokers on Chart)

941 747 657 656 330 302 293 277 231 214 207 189 165 151 149 148 107 95 94 91 79 62 61 59 55 53 46 43 39 37 36 36 35 33 29

9,900

Based on # of Transactions (All Sales $500,000 and Over)

INVESTMENT SALES

RETAIL LEASING

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MASSEYKNAKAL.COM

MANHATTAN BROOKLYN STATEN ISLAND THE BRONX QUEENS WESTCHESTER LONG ISLAND NEW JERSEY

Pr o f i l e

5Pointz unvarnished: the developer’s side

The Wolkoffs defend decision to whitewash their famed graffiti-covered buildings and talk about their first residential project in decades

David Wolkoff and his father, Jerry Wolkoff, at the 5Pointz site, where they’re planning a $400 million luxury rental project.

G

By Christopher Cameron &M Realty’s Jerry and David Wolkoff have kept a relatively low profile despite years of developing projects in the outer boroughs and on Long Island, as well as managing 15 million square feet of industrial and commercial space.

But the father–and-son duo were recently thrust into the spotlight when they whitewashed the so-called 5Pointz building they own in Long Island City, which since the 1990s was a premier destination for street artists, who adorned it with brightly covered graffiti. The controversial middle-of-the-night paint job was done to make way for two high-rise towers containing 800 luxury rentals and more than 200 affordable units, for a total cost of $400 million.

The project will be the Wolkoff family’s first residential play in the city in three decades, and opposition, not surprisingly, has been fierce.

Soon after plans were announced, a cadre of 17 artists filed a lawsuit in federal court in Brooklyn to block the demolition.

However, on Nov. 19, after both a federal judge and the Landmarks Preservation

76 May 2014 www.TheRealDeal.com

Commission refused to stop the plans, the Wolkoffs had the building quietly painted over. The family received a permit for remediation in mid-March and hopes to receive a demolition permit in the next month.

Despite the negative press, the Wolkoffs told The Real Deal they have no regrets.

“I don’t have any mixed feelings about the demolition,” David, 47, said during

do,” he said. “The work these artists do with a spray-paint can is mind-boggling to me. I really appreciate their work.”

5Pointz is born Jerry Wolkoff was in his late teens in his native Brownsville when he cut his real estate chops building houses, a business he learned from his brother. A born entrepreneur, he had already sold a successful floor-waxing business before graduating

By the time David was studying real estate and finance in college, his father was a major Brooklyn and Staten Island homebuilder, before transitioning the business into commercial and industrial development. At the time, the late 1970s, Long Island City was a bustling manufacturing hub, and the Wolkoffs were buying up property in the area. One such site was 5Pointz, a cluster of 10 interconnected industrial buildings on a full square block at

“For 20 years I allowed more than 100,000 paintings to exist on my building, but now that I want to build something great for the neighborhood, Meres and the others acted like the building was theirs.”

Jerry Wolkoff, G&M Realty an interview last month. “I think this is a very exciting project. I think it is going to be great for the community and the neighborhood.”

Jerry, 77, added that the new development will still honor the old 5Pointz with large walls for graffiti.

“I will bring back the aerosol artists, because I like them and I like what they

high school, and then used the capital to start his own residential development company. As a result, his son also spent his youth around real estate.

“Growing up, my father and uncles all had real estate businesses. All the adults I knew were builders,” David said. “I remember being 11 years old and out in the field.”

45–46 Davis Street.

Jerry paid just over $1 million for the properties, which total 200,000 square feet and served as a garment hub until the 1990s, when manufacturing began to die off in New York. At that point he converted the complex into studios to house roughly 200 artists and met Pat Delillo, Continued on page 122

www.TheRealDeal.com February 49 PHOTO ILLUSTRATION BY KEZIAH MAKOUNDOU; ORIGINAL PHOTOGRAPH BY CHRISTIAN2014 FERNANDEZ

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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 1983: City OKs long-term plan for Bryant Park rehab

T

he city, the New York Public Library and a park advocacy group announced a groundbreaking 35-year proposal to restore and upgrade the once drug-ridden Bryant Park, 31 years ago this month.

The controversial plan included building kiosks, constructing a large restaurant, expanding lighting and security and broadening the cultural offerings in the park, which occupies nearly an entire city block behind the library between 41st and 42nd streets, east of Sixth Avenue in Midtown.

The plan was hammered out between the city Bryant Park in 1983, before its restoration Department of Parks and Recreation, the library and the Bryant Park Restoration Corporation, a nonprofit group founded in 1980 to clean up the park, which during the 1970s was overrun by drug dealers and the homeless.

It was the first time the city contracted a private entity to manage a public park, a precedent that drew opposition from some park advocates. As part of the plan, an affiliate of Bryant Park Restoration signed a 35-year lease in July 1985 with the city to manage the park. The group continues to manage it today.

T

1953: Contentious Cross-Bronx route approved

he city approved a fiercely opposed route for the Cross Bronx Expressway that was reviled for destroying tight-knit neighborhoods in the name of modernization and public mobility, 61 years ago this month.

The Board of Estimate, which decided budgetary and land-use issues at the time, voted to back the freeway plan that cleaved through several South Bronx neighborhoods just north of Crotona Park and required demolishing about 1,500 homes and relocating about 5,000 people.

The path was part of the highway’s original master plan when construction began in 1948, but was put to a vote after Bronx residents and business interests put up fierce opposition. Robert Moses They suggested the expressway’s planners use a strip of Crotona Park for a portion of the route, but the powerful parks and highway builder Robert Moses, at the time the city’s construction coordinator, opposed that. Moses threatened to shift state and federal highway funds to other projects if the route was altered.

Highway billboards promoting the project said, “You can’t make omelets without breaking eggs,” the New York Times reported. The east-west highway forms a portion of I-95, and was completed in 1963 at a cost of $128 million.

N

1926: Historic state affordable housing law signed

ew York Gov. Alfred Smith put his signature to a housing measure 88 years ago this month that authorized the creation of the nation’s first quasi-governmental companies to develop affordable rental apartments.

The law, the Limited Dividend Housing Companies Act, provided for entities that capped the amount of profit investors could earn on a housing project, in conjunction with affordable rents and the power of eminent domain.

The new structure was needed to address an acute shortage of affordable apartments in the city despite a surge of housing development in the 1920s. Most of that new housing was occupied by moderate-income residents, leaving poorer New Yorkers living in slum conditions in so-called “old-law” tenements.

The law had local companion legislation passed one year later by the city’s Board of Estimate that gave the limited dividend companies a 20-year tax exemption.

The first project built under the law was the Amalgamated Abraham Kazan Houses in the Bronx, financed by the Amalgamated Clothing Workers Union. The project was led by noted union organizer Abraham Kazan.

Over the decades, the limited dividend law was used in 19 housing projects to build a total of more than 9,300 units, according to a 2004 report from the City Comptroller.

The report said the successor Limited-Profit Housing Companies Act, known as Mitchell-Lama, was passed in 1955 and used to finance nearly 140,000 units of housing. Compiled by Adam Pincus

78 May 2014 www.TheRealDeal.com

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Eastern Consolidated’s David Schechtman has done $4.4 billion in deals since 2005.

DAY IN THE LIFE OF:

David Schechtman The Eastern Consolidated exec talks about chasing deer, cranking up salsa on the radio and his ‘hot’ phones

D

avid Schechtman is a principal and executive managing director at the commercial brokerage Eastern Consolidated. He started his career as a bankruptcy lawyer at DLA Piper, but in 2005 joined Eastern Consolidated, where he’s done 267 deals totaling $4.4 billion, the largest of which was the 2007 sale of 344352 West Street for $215 million. He’s currently marketing the 100,000-square-foot Flushing Landmark building in Queens for $92 million and a 66,000-square-foot loft conversion at 110 Greenwich Street in Lower Manhattan for $60 million.

5:05 a.m. I wake up in Bedford Corners — in Westchester County — and I run for a solid 45 to 50 minutes. On the way back, I yell and throw my earphones at the six deer desecrating my front lawn. I am running in the New York City Marathon in November.

This is my fourth marathon, but I haven’t done one in 10 years. It’s a 40th birthday gift to myself. I turn 40 in October. We felt the midlife sports car was just too obvious and cliché. Also, I do it to support an incredible charity called the Blue Card, which aids Holocaust survivors in need.

6:40 a.m. I drive to White Plains and take a 39-minute train to Grand Central Station. On the way in, I read the New York Post and tons of emails.

7:30 a.m. I order egg whites and a scooped-out toasted whole-wheat sesame bagel and green juice at Zucker’s on Lexington Avenue.

7:45 a.m. I am at my desk making 20 to 25 phone calls. It doesn’t matter how much luck somebody in real estate has, new contacts are the key to sustaining business.

They’re highlighted in my legal pad every 80 May 2014 www.TheRealDeal.com

Recently I dined at Govinda’s, a vegetarian paradise at 305 Schermerhorn Street in Brooklyn. That site is also the world headquarters of my new client, the Sri Sri Radha Govinda, colloquially known as the Hare Krishnas.

day. I go through one legal pad a week — it’s a throwback to my lawyer days.

8:10 a.m . I meet with [Eastern Consolidated founders] Peter Hauspurg and Daun Paris. I tell them what I’m working on, and what the seven brokers who work for me are working on.

8:30 a.m. The phones are hot at this point. It doesn’t matter if it’s incoming or outgoing — I spend the next several hours on the phone. There’s a half-hour window in which junior brokers come in to discuss deals, leads and seek advice.

12:00 p.m. As a rule, I generally have two lunches out a week with clients, prospective clients or friends in the industry.

Even if it’s sitting in their offices having a quick sandwich, it’s important. I have my second green juice of the day.

Schechtman buys breakfast each day at Zucker’s on Lexington Avenue

8:15 p.m. I sprint over to Grand Central Station for the train. I read the Wall Street Journal and emails.

Schechtman is in training for the NYC Marathon

1:30 p.m. I’m back at my desk and attacking the phones. From 1:30 to 3:30, I’m on the phone and nothing is going to interrupt me.

4:00 p.m. I recently went on a site visit in Brooklyn Heights, where we’re in contract to sell a $60 million rental building.

We meet at the building with the seller and the buyer, and walk through some unforeseen, but not insurmountable, hurdles.

Green juice is a regular part of the diet

5:30 p.m. Almost every day, I talk on the phone with my children Leo, 8; Evelyn, 6; Ruby, 9 months; and Caryn, my wife. I hear about who is karate-chopping who in the solar plexus, and who is helping Mommy and Mima, my mother-in-law, who is with us six days a week. We have no nanny.

5:45 p.m. I either eat dinner in the city or have leftovers when I get home later on.

7:00 p.m. There is no way I am coming back to the office in Manhattan in any manner other than the subway. I put in face time with the guys and gals with whom I work. They’re still here, usually.

9:00 p.m. In my car, I turn the radio up like it’s 1987. I listen to 97.9. Little known fact: I love salsa and merengue. I’ve been listening to La Mega since I lived in Brooklyn in the ’80s.

9:30 p.m. I say hello to my wife and make my rounds in the house like a superintendent. Three floors and 97 light bulbs. I should have my own union to turn off the lights. I pop in on my son, who should not be up. Typically though, I don’t see my kids at all for three to four days a week, because of my schedule. They’re sleeping when I leave and they’re usually sleeping when I get home. From Friday through Sunday, I’m glued to my wife and kids. Other than going for a run, I am the fourth kid.

10:00 p.m. I do yoga in the basement. I don’t last more than 20 minutes. But without it, I would be half a person.

Randy Wayne White is a favorite author

11:00 p.m. I pass out in bed reading something by fiction authors Randy Wayne White or Nelson DeMille.

By Mark Maurer

PHOTOGRAPH OF David Schechtman FOR THE REAL DEAL BY christian fernandez

Architecture Review

|

Ja m e s G a r d n e r

30 Park Place: A nod to a masterpiece

The Robert A.M. Stern tower is a rebuke to Gehry’s 8 Spruce, but a tribute to the Woolworth Building

A

lthough Robert A.M. Stern has a number of high-rises to his credit, including the Seville and the Chatham, both on the Upper East Side, he is not generally known as a designer of tall buildings, with all the clamorous modernity that such structures imply.

It is interesting, then, to watch the emergence of 30 Park Place, which is already rising on the same street as the fabled Woolworth Building, its neighbor to the east.

Developed by Silverstein Properties, this new structure is being billed as Downtown’s second-tallest residential tower, at 926 feet. It will house 157 luxury condominiums, along with a 185room Four Seasons Hotel on the first 38 floors.

Silverstein, of course, is the developer of the World Trade Center and many other Downtown buildings. But while the company’s other developments in the vicinity of Ground Zero have been (or will be) in the pristine Neo-Modern idiom that one associates with their architects — Fumihiko Maki, Lord Norman Foster, Richard Rogers and Skidmore Owings & Merrill — Stern’s building is more traditional in its references, as one would expect from this architect.

Across City Hall Park, a stone’s throw away if you have a good enough arm, stands Frank Gehry’s 8 Spruce Street.

Stern’s new tower stands as an implicit reproach to that noisily contemporary structure, which is the tallest residential tower Downtown. It has had to take sides, literally and figuratively, and it has done so by sidling up to the Woolworth Building, which it resembles in hue, and in material as well, in the granite facing that adorns its façade.

Inspired by the vague and eclectic Classicism that Stern traditionally favors, 30 Park Place is hardly as ornate as the Woolworth Building, with its Rayonnant Gothic façade. But the fact that a building of this height should avoid a Modernist and Rationalist idiom is nearly as striking today as was Cass Gilbert’s decision, a century ago, to conceive his masterpiece, the Woolworth Building, in the language of Medieval architecture.

Scheduled for completion in early 2016, 30 Park Place resembles, at its base, the far larger base of the Hearst Building at 300 West 57th Street, above which rises the more conspicuous addition by Foster. The resemblance is so close that it’s hard to imagine that the Uptown building, designed by Josef Urban in 1928 and added to years later, was not on Stern’s mind when he was

82 May 2014 www.TheRealDeal.com

embarking upon his newest project.

This resemblance extends from the cast stone used for the two buildings to their pared-down Classical vocabulary, and, perhaps most of all, to the charming way in which their corners are chamfered at street level, with a portion excised above that. Although this chamfering of the corner is very rare in New York,

However, when the corners are chamfered, they suddenly become areas of intense urban interest, without any diminution of the status of the center of a block. And when, as in Buenos Aires and parts of Barcelona, all four corners of each intersection possess this point of urban interest and energy, then suddenly the end of every block becomes

A rendering of 30 Park Place in Lower Manhattan

Robert A.M. Stern

Developer Larry Silverstein

it is the rule in places like Buenos Aires and Ponce, Puerto Rico, and (to a lesser degree) Barcelona. It is a marvelous innovation, though all too rare in New York, where the corners of our streets are throwaway spaces that are impediments to the pedestrian and have no visual or urbanistic interest.

charged with interest and variety.

It is, of course, too late to impose this modification on a built-up city like New York. But it is worth mentioning that the chamfered corner is a most welcome modification of the grid, and that in regards to 30 Park Place, the two corners where Church Street intersects

with Barclay Street and with Park Place will be much improved because of this grace note.

The base of 30 Park Place will rise five or seven stories, depending on how you count the first two levels, which are double height. The main entrance will be on Church Street, diagonally across from another classic, the 1934–’35 Federal Office Building.

Two-story terraces will be set into each of the corners at the fourth floor, two floors below the point where the setback will begin. The renderings show that the shaft continues in a fairly uneventful and uninflected fashion up to about the 30th floor, at which point the interplay between terraces and chamfered corners resumes, all the way up to the summit, which promises to recall something of the elaborate style of the Woolworth Building in its volumetric complexity.

In some respects, the exterior of 30 Park Place reflects the style sometimes known as Moderne, which bears some similarities to Art Deco, but without that style’s theatricality or its frequent Medieval references. (An excellent place to see an abundance of such buildings is the Grand Concourse in the Bronx.) Perhaps the greatest master of the style was the Parisian architect Auguste Perret, best known for his Théâtre des Champs Elysees.

The interiors of 30 Park Place, which were also designed by Stern, fully bear out that Moderne aesthetic in the lobby, with what is being billed as its “Grand Staircase.” Here, there are none of the obviously historicist frills that one tends to associate with Stern. Rather the mood that dominates this space is one of smoothness and placidity that have been achieved through the planar and purely geometric distribution of tall, flat panels of rich marble, granite and wood.

And yet, even without any overt references, the serene mood delightfully reprises that of European Modernism before the hegemonic take-over of the International Style after the Second World War. As such, it is one of Stern’s most successfully historicist inventions.

Some of the other renderings for the interiors, as well as for the hotel’s bedrooms, elect a more obviously contemporary idiom. But even these suggest something of the serenity that, if the renderings are to be believed, will soon reign across the lobby of 30 Park Place. TRD Rendering courtesy of SPI

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Q&A

The Flushing market’s feng shui Development projects spur more interest as once predominately Asian area draws varied investors and finds new real estate balance

By Sasha von Oldershausen

T

he Flushing real estate scene was once considered a niche market for Asian communities. But in the past few years, the tide has turned.

Stephen Preuss, vice president of sales at Massey Knakal Realty Services, said that today he’s not only seeing a vibrant Asian market, but also Canadian, European, and South American capital heading to Flushing.

In this month’s Q&A, developers and brokers talked to The Real Deal about the neighborhood’s changing terrain. While condos like Sky View Parc, Residence 8 and the Sequoia made their debuts several years ago, there are now new mega-mixed-used projects underway.

Those mega-projects — specifically Willets Point, which is being developed by the Related Companies and Sterling Equities, as well as Flushing Commons, which is being developed by AECOM Capital, F & T Group, the

Stephen Preuss

vice president of sales, Massey Knakal Realty Services How does activity in the commercial and development markets in Flushing compare to last year, the year before and during the boom?

The price for land in most of the greater Flushing market is actually higher than before the downturn. We’re getting as much as 20 to 35 percent gains year-overyear. In downtown Flushing around Main Street and the surrounding three to four blocks, you’re looking at prices in excess of $200 per buildable square foot, and that can go as high as $300 per buildable square foot. In the secondary areas, it’s $150 to $200, and in the tertiary it’s $75 to $150 per buildable square foot.

What are the biggest challenges to marketing commercial properties in Flushing today? How do those challenges differ from what you’ve seen in recent years?

The challenge in the Flushing market is product. There’s not enough product or inventory for the existing demand, which is partly fueling the increase in pricing.

We’re seeing it change slowly, though.

There’s definitely more product on the market this year than last year. When there is more inventory and there is more to choose from, [buyers] may not pay the prices they’re willing to pay now.

What are the most surprising trends you are seeing in the Flushing market today?

I think Flushing is broadening in terms of the investors looking at it right now.

And the international investors are not only from Asia. I’ve had some people from Canada, and some European capital.

Some South American capital, as well. It’s still not as much as what you see in Manhattan. But until 12 months ago, I had never gotten calls from those people. I get those calls all the time now.

Other than Willets Point, what are the most exciting new development projects being built or planned in Flushing right now?

The RKO Keith’s Theater, which was approved for an approximately 400,000-square-foot development, had been in limbo for a while and was just sold. The new buyers are going to build that theater into a mixed-use facility. Because it’s a little smaller than Flushing Commons, it’ll get built quicker, and I think it will have a more immediate impact on the neighborhood.

Michael Meyer president, F+T Group

How does activity in the commercial and development markets in Flushing now compare to last year, the year before that and during the boom?

It’s in the last two years that the development really started to kick in. Take Sky View Parc. Once the recession hit, [that project] was the biggest casualty. They had a whole tower that had no sales … and now they’ve sold out.

That’s the best indicator of how the market is faring. During the recession, overall, Flushing thrived and did better than the

Rockefeller Group Development Corporation and others — will likely generate a new wave of real estate activity.

“We’ve seen this tremendous renaissance in Brooklyn, and now I think it’s shifting into Queens,” said Michael Dana, president and CEO of private equity firm Onex Real Estate Partners. “And I think that Flushing is the epicenter of this tremendous growth.”

Still, concerns about zoning are partly overshadowing the potential for building. While some big-name developers are stepping up their game in Flushing, without large swathes of land to build upon, sources said most of the area will continue to be dominated by smaller-scale projects.

For more on prices in the Flushing market, investment opportunities there and cultural nuances — like the importance of feng shui — we turn to our panel of experts. city average in terms of unemployment and in terms of real estate value. And I think [that is because] even though there’s been a downturn in the U.S. economy, China and Asia as a whole are doing well. The dynamic behind the Flushing phenomenon is the unique role that Flushing plays in the geopolitical scheme.

What is holding up the commercial market in Flushing in your view?

Queens is the most ethnically diverse county in the country. Flushing is a destination, particularly on the weekends, for the Asian community in the Tri-state area.

That community comes to Flushing to eat, to shop and for medical care because there’s a huge concentration of Chinese and Korean doctors. So there’s a huge demand for office space. The other critical factor is that the Chinese community is very driven by real estate. There’s a huge appetite to own real estate, not rent it.

What are the biggest challenges to marketing properties in Flushing today?

Up until now, it’s been the ethnic insularity of Flushing. You’ll see much of the signage is in Chinese. You also have cultural nuances. Feng shui is really important — the placement of doors, placement of bathrooms, configuration of hallways, placement of columns. For example, when we go to market on Flushing Commons, we expect to bring in a feng shui master. [In addition], the waterfront needs rezoning. There’s pollution in the waterway. That area along the river, unless you clean it up, it’s going to be like the Berlin Wall. When it gets rezoned, it will get cleaned up. If we can get that done, I think it’s going to be a huge change for all of Flushing.

Adelaide Polsinelli

senior director, Eastern Consolidated How does activity in the commercial and residential markets in Flushing now compare to last year, the year before that and during the boom?

What I’m seeing for Flushing is that as dense as it already is, it’s getting denser.

There’s a strong movement of owners and tenants from Chinatown. They’re feeling the pressure of increased rents and increased demand and values. In addition, those who own are getting tempted [to sell] by the record-breaking prices in the area. And owners and tenants alike are seeing better opportunities for the quality of living in Flushing than they are in Chinatown. The apartments are prettier, newer and more spacious. The rents are commensurate if not better than what they’re paying in Manhattan. There isn’t the crime that you might find in other areas. It is a tight-knit community, where a lot of them have invested in their homes, and so there’s a real standard to maintaining them. I think that’s going to continue to fuel that market. During the boom, the pricing for apartments was in the $400 to $500-a-foot range. Now it’s something like $600 to $700 a foot. The demand is getting stronger by the day. You don’t see a lot of foreclosures here because these people come in here and pay cash. They don’t overleverage. That also helps to maintain the stability of the area.

What are the biggest challenges to marketing commercial properties in Flushing today?

A few years ago, everyone thought that www.TheRealDeal.com May 2014 85

Q&A you needed to speak English to transact in New York City. Today, you have Asian speakers who can navigate through the nuances of that specific market. We have three or four Asian language–speaking brokers on our team who have been able to speak to investors in their language.

So we can navigate through that market because we’re equipped. But it behooves anyone to [have brokers who know] any language spoken in that area.

What sort of a discount percentage-wise is available for commercial properties in Flushing, compared with other parts of Queens, like Long Island City and Astoria?

I don’t think there’s a discount for Flushing. I think there’s a premium in Flushing. I think you have better retail today in Flushing than you do in Long Island City. The density of population is not the same. There are more people per square foot in Flushing than there are in Long Island City.

What are the most surprising trends you see in the Flushing real estate market today?

Most surprising to me is that I’m seeing people who have small properties trying to leverage the sale of that into something larger. There’s a strong and dedicated commitment to staying in the community. Owners are trading up as opposed to trading out.

There are a bunch of big-name players developing Willets Point and Flushing Commons. How does that impact the landscape in Flushing?

I think it’s a very strong vote of confidence to see these types of developers continuing to build there and continuing to make the area better. I do think that will open up the doors for new developers and developers who may not have looked at Flushing as a tried and true area.

Michael Dana

president/CEO, Onex Real Estate Partners There have been a number of reports about residential prices rising in Flushing. What are you seeing on that front?

Over the last year we’ve seen increases in pricing of 10 to 15 percent. I think you’re going to see those levels of increase each year for the next two to three years, because of the relative lack of supply and pent-up demand.

When you look at Flushing compared to other opportunities in New York City, Flushing continues to be, for luxury highrise new construction, the best value you can buy. In Long Island City, it’s $1,300 per square foot or more. In Flushing, it’s 86 May 2014 www.TheRealDeal.com

$750 to $800 per square foot, and that’s a huge discount. But I think that will narrow over the next several years. You might always see some discount to those markets, but not that much of a discount.

There are a bunch of big-name players developing projects in Flushing. How does that impact the landscape there?

I think you will see other big-name developers come to the area. There is a much higher level of product being delivered now, and we’re at the early stages of that trend.

What sorts of opportunities exist along the waterfront in Flushing for developers?

This is the natural next area to be developed. Right now, the use of that waterfront is more industrial. With Willets Point coming up, and with the planned cleanup of the water there, you’re going to see predominantly residential, but probably more office-type developments running up the waterfront. We’re working hard to try and accelerate the cleanup.

Funding issues caused by the economy will probably delay that. But it’s definitely something we’re pushing for.

Bill Seto

principal/broker, Fultonex Realty How does activity in the residential market in Flushing now compare to last year, the year before and during the boom?

It’s been increasing, because the word is out that not only Willets Point is coming to the area, but also Flushing Commons. People are exploring the future investment potential and going full-speed ahead.

Are you seeing residential sales and rentals accelerating? How long are properties staying on the market, and how does that compare with a year or two ago?

From my experience as a broker, I’m getting calls for future developments. People want to be on a waiting list, to be called upon when a development is up for sale. I get calls on a daily basis. Most of our deals are all cash. Within the Asian community, if an individual can’t afford a property, they invest with other family members.

But it’s all cash. And that gives them the opportunity to refinance later. It gives them bargaining power, too.

What are you seeing in terms of prices for residential? How much are they up or down by compared to the recent past?

For luxury, I’m seeing $800 per square foot. On the smaller projects, where you have maybe 20 to 30 units and they’re a

little more conservative on the finishings, they can range from $400 to $600 per square foot. It’s slowly increasing year by year. Developers justify that housing is limited, and that warrants the increase in price.

Which residential price ranges and housing types are performing best right now in Flushing, and how does that compare to the recent past?

People with families often look toward the two-family. That way, they have an extra rental, and they get to live in the other unit. The starter families, entrepreneurs and Wall Street people love condos. In that case, the biggest preference is a two-bedroom condo. The trend is to own. Asians are born with three principles: Have a family, have a business and own where you live. We’re not too much into renting.

What are the biggest challenges to marketing residential properties in Flushing today? How do those challenges differ from what you’ve seen in recent years?

The challenges for marketing houses concerns feng shui — the location, the direction the house is facing, the address numbers.… They don’t like the number four because in Chinese it sounds like the word for “death.” Or if someone has passed in the house.… All this is asked in the showing of the house, and it can delay a quick sale.

In parts of Queens, the focus is on single-family home development over condos, but Flushing has its share of condos, including Sky View Parc, Residence 8 and the Sequoia, which all went up several years ago, as well as newer projects. What concerns do you have about the climate for building condos?

There are concerns with zoning. As development properties come up for sale, if they’re not in a favorable condo zone, the developer might have to make changes to the project. There’s a lot of land for sale, but if you can’t build what you want on it, it can hurt the sale. Zoning needs to change. More immigrants are coming in and they need more housing. It’s great you have houses surrounding the Flushing area. But again, condos are becoming more favorable. If there’s enough demand from property owners, I think the city will pay attention to the zoning.

Donna Reardon

broker, Douglas Elliman How’s the Flushing residential market doing in general?

Flushing’s closed residential [sales] are up by a huge amount, and the prices are going up,

but the inventory is decreasing, and so are the listings that we have coming in.

Every arrow is up except for the inventory. I think the new development projects [in the works] are needed.

What else are you seeing in terms of residential prices?

The average price of a condo is up 14 percent from a year ago. In co-ops, the sold prices are also up about 14 percent.

Compare that to the rest of Queens, where the average price is up 6.8 percent in co-ops. In single and multi-family homes, prices on closed properties year to date are up 12 percent.

Who are the active residential buyers in Flushing right now? Are you seeing any changes in the demographics, or does it remain largely an Asian market?

What I see is a lot of Manhattan people coming into Queens. I’ve never seen so many Manhattan agents in the Queens’ market with their clients and customers. And Flushing has always been one of our most popular markets. Since 20 years ago, Flushing has been one of the neighborhoods that kept us busiest.

What market forces are prompting developers to build condos in Flushing today?

I think it fills the need of how people want to live. It’s like a city within a city.

Sky View Parc, for example, has everything they need there. People are very busy and it’s luxury living and they don’t have to worry about the maintenance of the home. I think condo living focuses on that need. trd

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www.TheRealDeal.com July 2013 65

Grand_TRD_10.5x14.5_HR.pdf

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4/29/14

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SAFETY/PRINT AREA 10.25"w x 14.25"h

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APPLIANCES_GE MONOGRAM_ PAGE _ ‘THE REAL DEAL’ AD _4C FULL BLEED BLEED SIZE: 10.75"w x 14.75"h • AD SIZE: 10.5"w x 14.5"h • PC RICHARD BUILDERS DIVISION AD

SAFETY/PRINT AREA 10.25"w x 14.25"h

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For builders and designers, the sophisticated styling and exceptional craftsmanship set Monogram apart from all other appliance brands. For more than a century, GE Appliances has been introducing innovations that enhance peoples’ lives, and the Monogram line represents the best of what can happen when GE ingenuity is put to work in the home.

Sophisticated styling,

infinite inspirations and exceptional craftsmanship...

150 PRICE PARKWAY, FARMINGDALE, NY • 800-368-6869 email: builders@pcrichard.com • FAX: 800-479-0336 4 DISTRIBUTION CENTERS IN THE NORTHEAST FARMINGDALE, NY • CARTERET, NJ • BRIDGEPORT, CT • GLEN BURNIE, MD

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Commercial and

NATIONAL MARKET

Snapshots of real estate residential real estate news briefs news from from around the U.S. around the U.S.

REPORT

Palm Springs

SEATTLE The Puget Sound area — the main ports of which are Seattle, Bremerton, and Tacoma — is suffering from a housing inventory shortage that is driving up prices. The median price of houses and condos in King County, which encompasses Seattle, was nearly $364,900 in January, 17 percent higher than the previous year, the Puget Sound Business Journal reported. And according to a report by the Northwest Multiple Listing Service, there is only a 1.8-month supply of houses and condos for sale in the county, a stark contrast to northeastern Washington, where there is a 50-month supply.

Other counties in the Puget Sound area reported similarly low numbers that dip below the four- to six-month supply necessary for a balanced market, industry analysts told the Puget Sound Business Journal.

Elvis Presley

Elvis Presley’s one-time 5,500-squarefoot pad has hit the market for $9.5 million. The King rented the four-bedroom, 5-bath home for a year in 1966, and after marrying Priscilla Presley in 1967, the couple spent their honeymoon there. The Palm Springs estate includes a pool, stage, private garden and tennis court and comes complete with a variety of Elvis memorabilia.

Home prices in Seattle and the rest of the Puget Sound area are rising because of an inventory crunch.

Hollywood Hills

BOSTON The fate of two casino proposals lies with whether or not the city any residential rental of fewer than 30 days unless the hosts of Boston qualifies as a “host community” under Massachusetts’ have a conditional-use permit. The law applies to both hosts 2011 casino law. The law says a designated “host community” has who own their units and those who rent them, and regardless of whether guests visit frequently or not, SFGate reported. As a result, Airbnb-related evictions are increasing, and the city’s enforcement of the law is becoming more active. San Francisco is among a number of cities that are now forced to rethink laws, as concerns arise out of temporary housing sites like Airbnb and VRBO, which have become increasingly popular. Meanwhile, in an attempt to assuage concerns over illegal-hotel activity in cities like San Francisco and New York City, Airbnb has decided to start collecting hotel taxes from its hosts.

Mohegan Sun is behind plans for one casino near Boston.

the power to either approve or reject casino projects through a neighborhood vote. There are two projects in question proposed for communities just north of Boston. One is a plan from Wynn resorts for a casino in Everett, and the other is for a casino in Revere from Mohegan Sun, the Boston Globe reported. Last month, Boston Mayor Martin Walsh stated that the city is unequivocally a host community, and cited the fact that both casino projects will rely heavily on Boston’s transportation services and other infrastructure. The Massachusetts gambling commission will take about a month to determine whether Boston qualifies, although the mayor questioned the commission’s power to do so. If Boston gains designated host status, the proposed casino projects will actually most likely be voted down according to the Globe. Citizens of Everett and Revere already voted to approve the plans.

CHICAGO Mayor Rahm Emanuel wants to increase the number of annual visitors to Chicago’s O’Hare airport to 55 million by 2020, and a recent renovation of the airport’s International Terminal is one step toward that goal. The $26 million renovation brought over two dozen new stores and restaurants to the terminal — a marked

Jodie Foster

Oscar-winning actress Jodie Foster once again put her 6,000-squarefoot Hollywood Hills West home on the market for $5.75 million. The “Silence of the Lambs” star listed the four-bedroom, four-bath Spanish-style villa, purchased in 1995, for $6.4 million last spring, but took it off the market during the holiday season.

Telluride

SAN FRANCISCO Airbnb and VRBO hosts are facing fines and eviction if they’re accused of illegally operating hotels under San Francisco’s ban on all residential rentals of fewer than 30 days. The law resembles New York City’s law against short-term rentals, which states that any permanent residential apartment with three units or more that is rented for fewer than 30 days to transient visitors is considered illegal hotel activity. The San Francisco law bans

92 May 2014 www.TheRealDeal.com

O’Hare airport’s new International Terminal

change from the International Terminal’s previous condition, which a city official called “obsolete,” DNAinfo Chicago reported. “More tourism means more visitors, means more jobs, means more business,” said U.S. Sen. Dick Durbin at the unveiling of the rebuilt Terminal Five. In addition to boosting sales at the airport, the project generated 184 permanent jobs at the new stores and restaurants and 180 construction jobs. Among the newly opened stores is a 10,000-square-foot duty-free shop, a Salvatore Ferragamo store and O’Hare’s first spa.

Compiled by Sasha von Oldershausen

Oprah Winfrey

Oprah Winfrey dropped $10.85 million for 60 acres of land in Mountain Village, an area close to Telluride Ski Resort in Colorado, making it the largest property in the village. Winfrey plans to build a home on the site, though there are restrictions that limit the amount of building on the parcel of land.

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ORAL REPRESENTATIONS CANNOT BE RELIED UPON AS CORRECTLY STATING REPRESENTATIONS OF THE DEVELOPER. FOR CORRECT REPRESENTATIONS, MAKE REFERENCE TO THE DOCUMENTS REQUIRED BY SECTION 718.503, FLORIDA STATUTES, TO BE FURNISHED BY THE DEVELOPER TO A BUYER OR LESSEE. Obtain the property report required by federal law and read it before signing anything. No federal agency has judged the merits or value, if any, of this property. This offering is made only by the Prospectus for the condominium and no statement should be relied upon if not made in the Prospectus for an offer to sell, or solicitation of offers to buy, the condominium units in states where such offer or solicitation cannot be made. We are pledged to the letter and the spirit of U.S. policy for the achievement of equal housing throughout the nation. We encourage and support an affirmative advertising and marketing program in which there are no barriers to obtaining housing on the basis of race, color, sex, religion, handicap, familial status or national origin.

ON THE MARKET $89M Upper West Side portfolio hits market A six-building Upper West Side portfolio near Columbia University has gone on the market, with an asking price of $89 million. The package originally consisted of eight buildings, Marco Lala of commercial brokerage Marcus & Millichap 500 Cathedral Pkwy told The Real Deal. The northernmost duo, near City College, sold in late December.

The remaining properties are located at 500 Cathedral Parkway; 3143, 3147 and 3149 Broadway; 111 West 104th Street; and 242 West 109th Street. The properties are being marketed by Marcus & Millichap. Marco Lala, Jack Lala and David Raciti have the collective listings, which include 152 apartment units, 97 of which are market rate, and six retail spaces that currently have five tenants.

Upper West Side garage could fetch $61M An affiliate of real estate firm Walter & Samuels is looking to sell an Upper West Side parking-garage site, which is being marketed as a potential redevelopment into condominiums. The 7,700-squarefoot site at 219-223 West 77th Street, between Amsterdam Avenue and Broadway, boasts 77,000 square feet of buildable space. Avison Young brokers Neil Helman, Charles Kings219-223 West 77th St.

94 May 2014 www.TheRealDeal.com

ley, Vincent Carrega and Jon Epstein are handling marketing. The property is expected to fetch at least $61 million, or $800 per square feet, the New York Post reported.

Hare Krishnas list Brooklyn HQ for $60M The International Society for Krishna Consciousness, also known as the Hare Krishna movement, wants to sell its U.S. headquarters in Downtown Brooklyn for upwards of $60 295-309 Schermerhorn St. million, or more than $300 per buildable square foot. The four-story, 34,000-squarefoot property at 295-309 Schermerhorn Street boasts 187,000 buildable square feet, and currently houses a temple and vegetarian restaurant, Govinda’s. The religious organization is looking for a new home in Queens.

Eastern Consolidated executive managing director David Schechtman and associate director Andrew Sasson are marketing the site and also assisting with scouting a new location, sources said.

Brooklyn development site on the market A development site with 89,500 buildable square feet in the Greenwood Heights section of Brooklyn is on the market with an asking price of $24.5 million. The property, located on the southeast corner of Fourth Avenue and 19th Street, 635 Fourth Ave. will be delivered with approved

Commercial properties NYC commercial properties recentlynow placed market up on forthe sale plans for 91 residential units, 6,300 square feet of retail and 1,400 square feet of community facility space. About 20 percent of the residential units will be allocated for affordable housing under the Inclusionary Housing Program, which qualifies the future development for a fixed tax abatement. Massey Knakal’s Michal Amirkhanian and Aaron Warkov are handling the sale.

Manhattan Country School lists UES home Fifty years after purchasing a five-story Upper East Side townhouse, the Manhattan Country School is listing the 7 East 96th Street property for $23 million. The Frenchstyle townhouse became home to the school in 1966. Founded with a tuition policy that enabled parents to pay on a sliding scale based on income, the school was reportedly under pressure for years but is now expanding, with enrollment doubling to roughly 400 students. Because of the growth, 7 East 96th St. the school is bursting at the seams of its 40-foot-wide mansion. Proceeds from the sale will go toward the school’s purchase of a larger site “near Central Park” and to beef up its endowment, Michèle Solá, Manhattan Country School’s financial director, told the Wall Street Journal. The Corcoran Group’s Sharon Baum and David Enloe have a co-exclusive with the CBRE Group’s Tim Sheehan, Dan Kaplan and Ned Midgley.

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* The complete offering terms are in an offering plan available from the Sponsor.

Real estate agents affiliated with The Corcoran Group are independent contractor sales associates and are not employees of The Corcoran Group. Equal Housing Opportunity. The Corcoran Group is a licensed real estate broker located at 660 Madison Ave, NY, NY 10065. All information furnished regarding property for sale or rent or regarding financing is from sources deemed reliable, but Corcoran makes no warranty or representation as to the accuracy thereof. All property information is presented subject to errors, omissions, price changes, changed property conditions, and withdrawal of the property from the market, without notice. All dimensions provided are approximate. To obtain exact dimensions, Corcoran advises you to hire a qualified architect or engineer.

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Deal Sheet summary

The Deal Sheet, on pages 98 to 114, covers transactions from 3/11/14 through 4/10/14.

Please submit future deals to deals@therealdeal.com.

Overview Property sales

Financing

Leases (# of deals)

Leases (square feet)

Deals

58

Transactions

9

Office

59

Office

671,151

Dollars

$689,090,000

Aggregate value

$179,050,000

Retail

86

Retail

206,894

Total

145

Total

878,045

Sales

5

Retail Development

6

Mixed-use Office Hotel

Multi-family

$68.4 4

6

Multi-family

$93.76

6

By dollar volume (in millions)

By type

Retail Development

95

Mixed-use

1.

$4

Office Hotel

Industrial

Industrial

.84

$241

35

$2 43 .1

Office leases Office leases by industry

Office leases sf by industry

Industry

Leases of deals

Industry

Top tenant reps for office leasing by sf Leases square feet

Broker

Leases square feet

Education 1

Education 55,000

Colliers International 181,642

Fashion* 9

Fashion* 35,062

Cassidy Turley 55,000

Financial 8

Financial 108,405

CBRE Group 54,627

Home Furnishings 3

Home Furnishings 64,079

Avison Young 20,689

Medical

5

Medical 33,628

Newmark Grubb Knight Frank

NGO 2

NGO 10,872

Cushman & Wakefield 19,217

Other 22

Other 86,914

Miyad Realty 15,250

Publishing 2

Publishing 224,081

Joseph P. Day Realty

Real Estate 2

Studley 10,914 Real Estate 38,263

Science & Technology 5

Science & Technology 14,847

20,120

12,500

MHP Real Estate Services

10,846

Retail leases Top tenant reps for retail leasing by sf

Retail leases by industry

Retail leases sf by industry

Ripco Real Estate 28,368

Health & Beauty

Health & Beauty

Newmark Grubb Knight Frank

Medical

Sinvin Real Estate 13,050

Other Discount

Kassin Sabbagh Realty 9,975

Fashion

Manhattan Commercial Realty

Food & Beverage

8,561

S. Blair Partners 8,300 M.C. O’Brien 7,517 BLU Realty Group 5,879

(*includes showroom space)

27 4

12

9

Medical Other

69,9

Discount Food & Beverage

2

78

, 25

76

Fashion

31

24,6 75

Winick Realty 17,823

3

5

RKF 20,850

83

26,255

18,5 3

Leases square feet

15 ,1

Broker

52,

743

www.www.TheRealDeal.com May 2014 97

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 3/11/14 to 4/10/14. Please submit future deals to deals@therealdeal.com.

Office leases Address

Size

Tenant / Representative

Landlord / Representative

Notes

One New York Plaza

176,121

Macmillan Science and Education / Leon Manoff, Colliers International

Brookfield Office Properties / A. Foster, P. Turchin, CBRE

The publishing giant signed a long-term lease for the entire 46th through 48th floors and part of the 45th floor.

333 Seventh Ave

55,000

Fashion Institute of Technology / S. Kahaner, J. Ogden, T. Johnson, Cassidy Turley

Samco Properties / Represented inhouse

The school signed an 18-year lease for administrative office space.

44 West 18th St

49,875

Pucci International Ltd. / D. Levy, J. Buslik, Adams & Co.

Forty Four Eighteen Associates / D. Levy, J. Buslik, Adams & Co.

The furniture manufacturer signed a lease renewal. The reported asking rent was $45 per square foot.

1115 Broadway

47,960

Harris Publications Inc. / D. Levy, J. Buslik, Adams & Co.

Eleven Fifteen Associates / D. Levy, J. Buslik, Adams & Co.

The magazine publisher signed a lease renewal. The reported asking rent was $49 per square foot.

230 Park Ave

43,295

Lebenthal Wealth Advisors / S. Petriello, N. Weld, CBRE

HSH Nordbank / P. Occhi, S. Bellwood, T. Livadiotis, E. Bush, Cassidy Turley

The private wealth advisory division of Lebenthal Holdings signed a six-year sublease for the 31st and 32nd floors. HSH Nordbank will relocate to the 34th floor.

157 Columbus Ave

28,638

The Yard / n/a

Brodsky Organization / J. Kuriloff, J. Roberts, D. Braver, C&W

The shared office space provider signed a long-term lease for the entire fourth and fifth floors.

199 Water St

20,689

The Western Union Company / Michael Gottlieb, Avison Young

Jack Resnick & Sons / n/a

The financial company signed a lease for part of the 29th floor.

110 East 59th St

13,284

J.F. Lehman & Company / David Falk, NGKF

Jack Resnick & Sons / n/a

The private equity firm signed a lease on the 27th floor.

1350 Sixth Ave

13,065

Seabury Advisors Holdings LLC / A. Field, D. McBride, C&W

SL Green / Represented in-house

The investment banking firm signed a new seven-year lease for the entire 25th floor.

50 Court St (Brooklyn)

12,500

New York Methodist Hospital / Craig S. Berman, Joseph P. Day Realty

Joseph P. Day Realty / Frank Zimbaro, Joseph P. Day Realty

The hospital signed a lease.

500 Fifth Ave

10,914

Kanematsu / M. Goldman, J. Messina, K. Otomo, Studley

500 Fifth Avenue Inc. / H. Blair, S. Kearns, C&W

The trading company signed a long-term lease for the entire 29th floor.

1733 Eastchester Rd (The Bronx)

10,000

CenterLight Healthcare / n/a

Simone Development / n/a

The healthcare services company signed a lease for a freestanding office building.

5 Hanover Sq

9,625

MetroLoft Management / Philip Metzidakis, Jansizian Group

Boys and Girls Club of America / Arthur Spitalnick, Kaufman Organization

The real estate development firm signed a four-year sublease. The reported asking rent was $32 per square foot.

49 West 23rd St

8,373

Sleepy’s LLC / James Buslik, Adams & Co.

Twenty Three R.P Associates / James Buslik, Adams & Co.

The bedding and mattress retailer signed a lease renewal for showroom space.

10 West 33rd St

7,700

H.E.R. Accessories LTD / Michael Beyda, Benchmark Group New York

Ten West Thirty Third Associates / David Levy, Adams & Co.

The accessories company signed a new lease for nine years and 11 months. The reported asking rent was $42 per square foot.

80 Broad St

7,255

Revenue Watch Institute / n/a

Savanna / H. Stein, T. Stracci, A. Leshowitz, NGKF

The nonprofit signed a new seven-year lease on the 18th floor.

10 West 33rd St

7,144

L&P Group USA Inc. / BLU Realty Group

Ten West Thirty Third Associates / D. Levy, J. Buslik, Adams & Co.

The jewelry and accessories company signed a new lease. The reported asking rent was $39 per square foot.

100 Wall St

6,836

Pixable Inc. / Jonathan Tootell, NGKF

Savanna / M. Konsker, S. Cahaly, K. Young, JLL

The tech company signed a new 10-year lease for part of the 18th floor.

8 West 40th St

6,667

Joseph Ratner & Co. Inc. / n/a

Jack Resnick & Sons / n/a

The tenant signed an office lease.

11 East 26th St

6,663

Sleep Medicine Associates of NYC PLLC / James Buslik, Adams & Co.

East Twenty Sixth Associates / James Buslik, Adams & Co.

The medical practice signed a new lease. The reported asking rent was $49 per square foot.

880 Third Ave

6,655

Fisher, Harris, Shapiro, Inc. / n/a

Jack Resnick & Sons / n/a

The risk management services firm signed a lease.

350 Fifth Ave (Empire State Building)

6,152

Qatar Airways Q.C.S.C / G. Markman, J. Cirone, C&W

Empire State Realty Trust / W. Cohen, J. Tootell, S. Ursini, NGKF; R. Kass, ESRT

The airline signed a new lease.

135 West 26th St

6,000

Iluminage Beauty Inc. / M. Jotkowitz, M. Rouzenrouch, Miyad Realty

Miltan Management / n/a

The home beauty device company signed a lease for two floors.

1350 Broadway

5,839

Marshall & Stevens Inc. / Michael Hirsch, CBRE

Empire State Realty Trust / W. Cohen, N. Rubin, A. Weisz, NGKF; R. Kass, ESRT

The financial firm signed a new lease.

1115 Broadway

5,831

Comfort Co. Inc.; Sleep Innovations, Inc.; Advanced Urethane Technologies, Inc. / James Buslik, Jeff Buslik, Adams & Co.

Eleven Fifteen Associates / James Buslik, Jeff Buslik, Adams & Co.

The tenants signed a new lease for showroom space for the sale of bedding and related products. The reported asking rent was $59 per square foot.

213 West 35th St

5,750

Mod Lifestyles LLC / A. Bonett, B. Cohn, Adams & Co.

Justin Management / Represented in-house

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

1350 Broadway

5,690

Captivate Network / n/a

Empire State Realty Trust / W. Cohen, N. Rubin, A. Weisz, NGKF; R. Kass, ESRT

The media and advertising firm signed a new lease.

55 Broadway

5,521

Zazoom LLC / Stephen Chasanoff, Colliers International

Gallen Technology Solutions / Helmsley Spear

The Internet news company signed a new 28-month lease for part of the eighth floor.

350 Fifth Ave (Empire State Building)

5,192

Moses & Ziegelman LLP / Jonathan Anapol, Prime Manhattan Realty

Empire State Realty Trust / W. Cohen, J. Tootell, S. Ursini, NGKF; R. Kass, ESRT

The legal services firm signed a new lease.

156 Fifth Ave

5,000

Graj + Gustavsen / M. Jotkowitz, M. Rouzenrouch, Miyad Realty

n/a / n/a

The brand strategy consultants signed a new lease.

180 Varick St

4,657

GRADE / Daniel Breiman, Olmstead Properties

Olmstead Properties / Represented in-house

The architectural firm signed a new eight-year lease for part of the ninth floor.

530 Seventh Ave

4,615

Trybus International Corporation / B. Neugeboren, N. Goetz, Savitt Partners

n/a / Bob Savitt, Savitt Partners

The clothing company signed a lease renewal on the 24th floor and expanded into an adjacent space.

555 Eighth Ave

4,250

Zara Terez / Mayer Jotkowitz, Miyad Realty

Sloyer-Forman Inc. / n/a

The fashion company signed a lease for third-floor space. The reported asking rent was in the low $30s per square foot.

98 May 2014 www.TheRealDeal.com

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This advertisement is not an offering. It is a solicitation of interest in the advertised property. No offering of the advertised units can be made and no deposits can be accepted, or reservations, binding or non-binding, can be made until an offering plan is filed with the New York State Department of Law. This advertisement is made pursuant to Cooperative Policy Statement 1, issued by the New York State Department of Law. CP13-0090

Office leases continued Address

Size

Tenant / Representative

Landlord / Representative

Notes

231 West 39th St

4,245

RAMY Brook LLC / James Buslik, Jeff Buslik, Adams & Co.

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

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

721 Seventh Ave

3,839

Big Bus Tours New York / M. Kabiri, W. Stein, Manhattan Commercial Realty

n/a / Jack Cohen, Comjem Associates

The tour company signed a five-year lease for the entire fifth floor.

350 Fifth Ave (Empire State Building)

3,778

Taurasi Capital Management / Jeff Hersh, Prime Manhattan Realty

Empire State Realty Trust / W. Cohen, J. Tootell, S. Ursini, NGKF; R. Kass, ESRT

The investment firm signed a new lease.

1450 Broadway

3,771

Lu Thai Textile / Arthur Spitalnick, Kaufman Organization

ZAR Group / M. Konsker, J. Fanuzzi, B. Bass, JLL

The men’s shirt manufacturer signed a seven-year lease for full-floor space.

The reported asking rent was $70 per square foot.

350 Fifth Ave

3,617

Community Options Inc. / Erik Alberti, EFA Realty

Empire State Realty Trust / W. Cohen, J. Tootell, S. Ursini, NGKF; R. Kass, ESRT

The nonprofit signed an expansion lease.

1359 Broadway

3,543

BMR Energy / Ivan Hillman, CBRE

Empire State Realty Trust / W. Cohen, N. Rubin, A. Weisz, NGKF; R. Kass, ESRT

The energy company signed a new lease.

821 Broadway

3,233

Somo Global Inc. / James Costello, Sinvin Real Estate

Go Film Inc. / A. Epstein, E. Fisher, Easy Street Properties

The mobile technology firm signed a sublease on the sixth floor. The reported asking rent was $50 per square foot.

350 Fifth Ave (Empire State Building)

2,897

BioSynthema Inc. / S. Esther Zar, MHP Real Estate Services

Empire State Realty Trust / W. Cohen, J. Tootell, S. Ursini, NGKF; R. Kass, ESRT

The healthcare company signed a new lease.

17 Battery Pl

2,750

Berman & Palitz LLP / J. Friedman, B. Varricchio, G. Varricchio, MHP Real Estate Services

n/a / Adam Leshowitz, NGKF

The law firm signed a seven-year lease.

1350 Broadway

2,328

eCommission Solutions LLC / Brett Maslin, Adams & Co.

Empire State Realty Trust / W. Cohen, N. Rubin, A. Weisz, NGKF; R. Kass, ESRT

The technology firm signed a new lease.

10 East 23rd St

2,250

Think PR / Joe Friedman, MHP Real Estate Services

n/a / Robert Camacho, Buchbinder & Warren

The public relations firm signed a five-year lease. The reported asking rent was $49 per square foot.

80 Broad St

2,240

Indus Architect / Jovan Johnson, Fountain Realty Group

Savanna / H. Stein, T. Stracci, A. Leshowitz, NGKF

The forensic architectural firm signed a new seven-year lease for part of the 16th floor.

530 Seventh Ave

1,960

Gokaldas Images (USA) Inc. / Roy Somwaru, EVO Real Estate Group

n/a / B. Neugeboren, N. Goetz, Savitt Partners

The men’s suit manufacturer signed a lease on the 24th floor.

520 West 27th St

1,950

Urban Oasis / Matt Burgey, CBRE

Eldar Tuvey / Roxanne Betesh, Sinvin Real Estate

The design firm signed a five-year, two-month lease for part of the sixth floor.

The reported asking rent was $55 per square foot.

40 Exchange Pl

1,800

Maiden Capital Source / Henry Fuentes, Manhattan Commercial Realty

40 Exchange Corp. / Charles Beyda, Jud Leasing Corp.

The financial services firm signed a long-term lease.

230 Park Ave

1,749

T-Rex Group Inc. / Andrew Arvay, MHP Real Estate Services

n/a / Stephen Bellwood, Cassidy Turley

The tenant signed a two-year sublease.

133 East 58th St

1,745

Transform Fitness Inc. / n/a

Jack Resnick & Sons / n/a

The fitness studio signed a lease.

133 East 58th St

1,568

Allergy & Asthma Care of NY Inc. / n/a

Jack Resnick & Sons / n/a

The medical practice signed a lease.

530 Seventh Ave

1,400

SRP Apparel Group Inc. / B. Neugeboren, N. Goetz, Savitt Partners

n/a / Bob Savitt, Savitt Partners

The apparel company signed a lease renewal on the eighth floor.

109 West 27th St

1,400

HeyKorean / Ioannis Kourtis, NY Citi Group Realty

Silvia Braun Trust / Ioannis Kourtis, NY Citi Group Realty

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

10 West 33rd St

1,371

Colombino Headwear Inc. / David Levy, Adams & Co.

Ten West Thirty Third Associates / David Levy, Adams & Co.

The accessories company signed a lease renewal. The reported asking rent was $47 per square foot.

39 West 14th St

1,200

Young & NG LLC / Daniel Lolai, MHP Real Estate Services

n/a / Comjem Associates Ltd.

The tenant signed a three-year lease.

64 Willoughby St (Brooklyn)

1,050

I Can Haz Inc. / M.C. O’Brien

n/a / M.C. O’Brien

The Internet company signed a lease.

16 West 32nd St

930

CitiPak Delivery Systems Inc. / BLU Realty Group

n/a / BLU Realty Group

The messenger service signed an office lease.

110 West 40th St

891

Pyramid Consulting Group LLC / D. Levy, B. Maslin, Adams & Co.

One Ten West Fortieth Associates / D. Levy, B. Maslin, Adams & Co.

The consultancy signed a new lease. The reported asking rent was $46 per square foot.

721 Seventh Ave

890

Big Bus Tours New York / M. Kabiri, W. Stein, Manhattan Commercial Realty

n/a / Jack Cohen, Comjem Associates

The tour company signed a two-year lease for the entire seventh floor.

Retail leases Address

Size

Tenant / Representative

Landlord / Representative

Notes

2120 Rockaway Pkwy (Brooklyn)

11,000

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

Osborn Belmont Properties LLC / R. Senior, E. Bukai, M. Mahony, Ripco Real Estate

The discount chain signed a lease for a new location.

2114 Coyle St (Brooklyn)

10,000

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

Coyle Properties LLC / Prime Choice Realty

The discount chain signed a lease for a new location.

33 East 33rd St

9,250

Open Kitchen 33 / Jonathan Krieger, RKF

ELK 33 East 33rd / Josh Siegelman, Winick Realty

The restaurant signed a lease.

100 East Fordham Rd (The Bronx)

8,300

Karen Clothes / Sheldon Franklin, S. Blair Partners

Sidley Holding Co. / Steven Weissmann, Winick Realty

The clothing shop signed a lease.

688 Court St (Brooklyn)

7,500

Taxi Tour Inc. / M. Kabiri, W. Stein, Manhattan Commercial Realty

n/a / Abe Gross, CBRE

The taxi company signed a five-year lease.

40-07 73rd St (Queens)

7,000

CityMD / Ben Birnbaum, NGKF

73 Woodside Owner LLC / Mark Kapnick, SRS Real Estate Partners

The urgent-care facility signed a 15-year lease. The reported asking rent was $140 per square foot.

455 West 37th St

5,905

MJM Boxing / K. Ota, A. Cukier, NGKF

455 West 37 LLC / S. Baker, A. Fishbein, Winick Realty

The fitness studio signed a lease.

20 Pine St

5,733

FedEx / Cassidy Turley

n/a / M. Tabibnia, B. Farchi, Azad Property Group

The courier delivery services company signed a 10-year retail lease.

100 May 2014 www.TheRealDeal.com

The Right Prescription For All Of Your Healthcare Real Estate Needs AVAILABLE PROPERTIES

IN THE HEART OF IT ALL 57th St at Park Avenue Size: 9,408 to 32,713 SF+/- for lease

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THE DOWNTOWN MEDICAL BUILDING William St btwn Ann & Beekman St Size: 24,000 to 124,000 SF+/- for lease

MAGNIFICENT MADISON AVENUE Madison Ave at 61st St Size: 3,000 SF+/- for lease

AESTHETIC CENTER WITH O.R. 66th St btwn 2nd & 3rd Aves Size: 5,774 SF+/- for lease

UPPER EAST MEDICAL SPACE 67th St btwn 2nd & 3rd Aves Size: 5,200 SF+/- for lease

UES MEDICAL BUILDING 78th St btwn. 3rd & 2nd Aves Size: 2,400 to 7,200 SF+/- for lease

RARE UWS MEDICAL 86th St btwn. Columbus & Amsterdam Size: 1,200 SF+/- for sale

GREAT FOR A GROUP PRACTICE Fifth Ave at 96th St Size: 2,300 SF +/- for sale

RUTHERFORD PLACE MEDICAL CONDO 2nd Ave btwn. 17th & 18th Sts Size: 2,170 SF+/- for sale

SPECTACULAR MEDICAL SUITES 37th St btwn. 2nd & 1st Aves Size: 1,679 to 23,782 SF+/- for lease

UWS ORTHODONTIST OFFICE West End Ave at 73rd St Size: 1,050 SF+/- for sale

RETAIL/MEDICAL OPPORTUNITY 2nd Ave at 94th St Size: 3,000 to 11,000 SF+/- for lease

COMMERCIAL/MEDICAL ON MADISON Madison Ave at 76th St Size: 5,000 SF+/- for lease

PREWAR MEDICAL OFFICE 72nd St btwn. Park & Madison Aves Size: 1,100 SF+/- for sale

PARK AVENUE GEM Park Ave at 63rd St Size: 1,700 SF+/- for sale

CLOSE TO GRAND CENTRAL 46th St btwn. Fifth & Madison Aves Size: 935 to 4,529 SF+/- for lease

MOVE-IN CONDITION ON MADISON Madison Ave btwn. 59th & 60th Sts Size: 3,200 SF+/- for sublease

TOWNHOUSE MEDICAL SPACE 69th btwn. Park & Lexington Aves Size: Size: 1,800 SF+/- for lease

EXCELLENT UES LOCATION 77th St btwn. Lex & 3rd Aves Size: 5,936 SF+/- for lease

ARTIST RENDERING

RENOVATED TOWNHOUSE SPACE 61st St btwn. Third & Lexington Size: 1,800 SF+/- for lease

ADAPTABLE FOR ALL SPECIALTIES Park Ave at 89th St Size: 1,300 SF+/- for sale

CONDO CONVERSION ON PARK* Park Ave at 71st St Size: 1,841 to 3,906 SF+/- for sale

NEW CONDOS ON FIFTH AVE** Fifth Ave at 102nd St Size: 1,353 SF+/- for sale

VILLAGE CONDO 12th St btwn. University Pl & Broadway Size: 1,627 SF+/- for sale

GEM ON 72ND STREET 72nd St btwn. Lex & Park Aves Size: 900 SF+/- for sale

YORKVILLE BUILT TO SUIT 79th St btwn. 1st & York Aves Size: 3,369 SF+/- for lease

GREAT UPPER EAST LOCATION 87th St btwn. Park & Madison Aves Size: 920 SF+/- for sale

PRIME FIFTH AVE MEDICAL Fifth Ave at 86th St Size: 1,320 & 1,890 SF+/- for lease

ARTIST RENDERING

NEW DEVELOPMENT OPPORTUNITY 168th St btwn Amsterdam & Audubon Ave Size: 2,574 to 15,000 SF+/- for lease

CORNER OFFICE IN CARNEGIE HILL Park Ave at 96th St Size: 2,500 SF+/- for sale

STEPS TO THE PARK 86th St btwn. 5th & Madison Aves Size: 900 SF+/- for lease

LAST CONDO UNIT LEFT*** 64th St btwn. 3rd & 2nd Aves Size: 10,500 SF+/- for lease/sale

FABULOUS FIFTH AVENUE Fifth Ave at 61st St Size: 1,468 to 7,048 SF+/- for lease

Contact us for information on any of these properties or for the largest selection of Healthcare Properties in New York City.

Josef Yadgarov Licensed Real Estate Salesperson o: 212.836.1097 jyadgarov@corcoran.com

Paul L. Wexler Licensed Associate Real Estate Broker o: 212.836.1075 plw@corcoran.com

Kathleen Caracappa Licensed Real Estate Salesperson o: 212.893.1441 kcaracappa@corcoran.com

The complete offering terms are in an offering plan from *Sponsor File No: CD110149 **Sponsor File No: CD110057 ***Sponsor File No: CD890467

Real estate agents affiliated with The Corcoran Group are independent contractor sales associates and are not employees of The Corcoran Group. Equal Housing Opportunity. The Corcoran Group is a licensed real estate broker located at 660 Madison Ave, NY, NY 10065. All information furnished regarding property for sale or rent or regarding financing is from sources deemed reliable, but Corcoran makes no warranty or representation as to the accuracy thereof. All property information is presented subject to errors, omissions, price changes, changed property conditions, and withdrawal of the property from the market, without notice. All dimensions provided are approximate. To obtain exact dimensions, Corcoran advises you to hire a qualified architect or engineer.

Retail leases continued Address

Size

Tenant / Representative

Landlord / Representative

Notes

26 Greene St

5,700

Lazzoni / Sarah Shannon, Sinvin Real Estate

Javeri Capital / J. McVerry, Atria Properties; C. Johnson, RKF

The furniture retailer signed a lease. The reported asking rent was $175 per square foot.

3720 Nostrand Ave (Brooklyn)

5,400

3720 Nostrand Laundromat LLC / n/a

Isidore Margel Trust / M.C. O’Brien

The Laundromat signed a lease.

Belt Pkwy and Erskine St (Brooklyn)

5,368

Lane Bryant / J. Isaacs, B. Schuster, Ripco Real Estate

Related Properties / J. Isaacs, B. Schuster, Ripco Real Estate

The fashion retailer signed a lease.

555 West 59th St

4,961

Riverside Center / Thomas Murray, Lincoln Property Company

555 Retail Owner / S. Baker, C. Rapuano, Winick Realty

The condo leasing office took retail space.

50-01 Second St (Queens)

4,225

North Shore-Long Island Jewish / B. Waterman, B. Ozarowski, NGKF

50-01 2nd Street / H. Shapiro, A. Fishbein, Winick Realty

The hospital signed a lease.

100 Wooster St

3,800

Morgane Le Fay / Sarah Shannon, Sinvin Real Estate

Crown Wooster LLC / M. Glanzberg, J. Bowling, Sinvin Real Estate

The fashion retailer signed a one-year lease. The reported asking rent was $462 per square foot.

1350 Broadway

3,675

Gabriel Brothers Inc. / Wayne Siegel, CBC Alliance

Empire State Realty Trust / W. Cohen, N. Rubin, A. Weisz, NGKF; R. Kass, ESRT

The discount fashion retailer signed an expansion lease.

887 East New York Ave (Brooklyn)

3,500

Dr. Custis / M.C. O’Brien

Blake Christopher NY LLC / M.C. O’Brien

The medical practice signed a retail lease.

42 West 39th St

3,152

Westside Donut 39th Street Ventures LLC / David Levy, Adams & Co.

42-52 West 39 Street LLC / David Levy, Adams & Co.

The donut shop signed a new lease. The reported asking rent was $100 per square foot.

32 East 20th St

3,000

Le Coq Rico / M. Cohen, B. Birnbaum, NGKF

Walter Samuels / M. Miller, R. Burack, Winick Realty

The French restaurant signed a lease for its first U.S. location.

1290 Amsterdam Ave

3,000

Center Pharmacy / RKF

n/a / RKF

The pharmacy signed a lease.

341 Eastern Pkwy (Brooklyn)

3,000

Capital One Bank / Barry Fishbach, RKF

Bluejay Management / T. King, R. Condren, K. Triglia, G. Danut, CPEX Real Estate

The bank signed a lease.

7 East 14th St

2,800

Ricky’s Union Square / n/a

Victoria Retail / S. Baker, A. Fishbein, Winick Realty

The beauty products retailer signed a lease.

1642 Lexington Ave

2,700

7-Eleven / R. Berkowitz, A. Schuster, G. Covey, RKF

United Management / L. Shabtai, M. Kass, Winick Realty

The convenience store signed a lease.

496 LaGuardia Pl

2,700

Pita Grill / James Famularo, Eastern Consolidated

n/a / James Famularo, Eastern Consolidated

The restaurant signed a 12-year lease for a new location.

1026 Sixth Ave

2,700

J & L Trading Game Inc. / Nelson Mieses, Rescom Properties

n/a / Carlos Silberman, Falcon Properties

The game shop signed a three-year lease.

791 Madison Ave

2,550

Rena Lange / R. Kaplan, K. Cohen, M. Dreizen, NGKF

Friedland Properties / n/a

The fashion retailer signed a lease.

47 West 28th St

2,516

JC Bosto / BLU Realty Group

n/a / BLU Realty Group

The jewelry wholesale company leased retail space.

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102 May 2014 www.TheRealDeal.com

A thousand reasons for our refrigeration system.

Or as we call them: 1,648 combination options.

The difference is Gaggenau.

Great cuisine starts with storing food properly. That’s why the 400 series modular refrigeration is stainless steel on the outside and the inside, a quality standard otherwise only found in professional cold storage. Other extraordinary features are the new LED lighting pillars, a continuously adjustable motorized shelf and the temperature-controlled drawer. This is a real stainless steel fridge - inside and out - fully loaded with all of our food storage expertise.

For more information about Gaggenau please visit www.gaggenau-usa.com or our Gaggenau showroom in the A&D Building, 150 East 58th Street, Suite 700, New York, NY 10155 or call 888.455.8892.

Retail leases continued Address

Size

Tenant / Representative

Landlord / Representative

Notes

48 West 37th St

2,418

Westside Donut 37th Street Ventures LLC / David Levy, Adams & Co.

Forty Eight Thirty Seven Associates / David Levy, Adams & Co.

The donut shop signed a new lease. The reported asking rent was $100 per square foot.

99 Essex St

2,400

Blue Enjo / Albert Manopla, Kassin Sabbagh Realty

n/a / Albert Manopla, Kassin Sabbagh Realty

The spa signed a lease.

190 West 237th St (The Bronx)

2,350

Chipotle Mexican Grill / K. Hochhauser, D. Boutross, Winick Realty

AG-Metropolitan Real Estate / n/a

The Mexican restaurant chain signed a lease for a new location.

1765 First Ave

2,300

Sherwin-Williams / n/a

n/a / Jill Lovatt, Massey Knakal

The paint shop signed a lease.

771 Broadway

2,270

Teavana / D. Firestein, T. Brandes, SCG Retail

Rose & Associates / n/a

The café signed a lease for a new location.

365 Knickerbocker Ave (Brooklyn)

2,250

Petland Discounts / Marc Leber, NGKF

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

The pet store signed a lease.

13-17 Crosby St

2,200

Spin Ceramics / Sarah Shannon, Sinvin Real Estate

Centre Street Partners LLC / Lisamarie Dixon, Paley Dixon Inc.

The ceramics retailer signed a five-year lease with a five-year option to renew.

The reported asking rent was $175 per square foot.

432 Ninth Ave

2,200

The Photo Village / S. Baker, A. Fishbein, Winick Realty

n/a / S. Baker, A. Fishbein, Winick Realty

The camera retailer signed a lease.

655 Third Ave

2,115

Country Bank / K. Hochhauser, S. Baker, Winick Realty

DOLP 655 Properties / K. Hochhauser, S. Baker, Winick Realty

The bank signed a retail lease.

49 West 28th St

2,113

Leia Jewelry / BLU Realty Group

n/a / BLU Realty Group

The jewelry wholesale company leased retail space.

1172 Flatbush Ave (Brooklyn)

2,017

Careway Pharmacy Inc. / M.C. O’Brien

1172 Flatbush Avenue LLC / n/a

The pharmacy signed a lease for its fifth location.

260 Madison Ave

2,000

Alidoro / Abie Dwek, Kassin Sabbagh Realty

Sapir Organization / Alan Wildes, C&W

The restaurant signed a lease. The reported asking rent was $100 per square foot.

463 86th St

2,000

Chipotle Mexican Grill / K. Hochhauser, D. Boutross, Winick Realty

Thor 463 86th Street / n/a

The Mexican restaurant chain signed a lease for a new location.

200 Church St

2,000

New York Nautical / RKF

n/a / RKF

The professional mariners’ shop signed a lease.

134 Ninth Ave

2,000

Mattese NYC / A. Spanbock, A. Stupak, TASK Realty

n/a / S. Rappaport, M. Sarway, Sinvin Real Estate

The beauty shop signed a 10-year lease. The reported asking rent was $81 per square foot.

1702 Mermaid Ave (Brooklyn)

2,000

Brooklyn Community Services / M.C. O’Brien

Taconic Management Company LLC / M.C. O’Brien

The nonprofit signed a retail lease.

189 Ninth Ave

1,963

Fonda of Chelsea / Josh Siegelman, Winick Realty

189 Ninth Avenue / Josh Siegelman, Winick Realty

The restaurant signed a lease.

1073-1075 Third Ave

1,954

Teavana / D. Firestein, T. Brandes, SCG Retail

n/a / Jason Greenstone, C&W

The café signed a lease for a new location.

149B West 36th St

1,900

Jsong International / Richard Smith, Winick Realty

Zone 26 Fashion / Richard Smith, Winick Realty

The sportswear designer signed a retail lease.

173/175 Morgan Ave (Brooklyn)

1,850

Arrogant Swine / J. Wadler, V. Lopez, Kalmon Dolgin Affiliates

Meisel-Peskin Co, Inc. / J. Wadler, V. Lopez, Kalmon Dolgin Affiliates

The barbecue restaurant signed a long-term lease.

373 South 1st St (Brooklyn)

1,774

Moss Clothing LLC / Tijana Masic, Misrahi Realty

Sultan Parveen LLC / Daniel Barcelowsky, Misrahi Realty

The clothing retailer signed a lease.

19 East 66th St

1,500

n/a / n/a

n/a / Jill Lovatt, Massey Knakal

An art gallery signed a lease.

1250 Waters Pl (The Bronx)

1,500

Dunkin’ Donuts / n/a

Simone Development / J. Kelleher, J. Gopan, Simone Development

The donut chain signed a 10-year lease at the Hutchinson Metro Center Atrium office complex.

3555 Johnson Ave (The Bronx)

1,450

Arjay Wireless / S. Baker, N. Caban, Winick Realty

Friedland Properties / n/a

The electronics retailer signed a lease.

188 Mulberry St

1,400

Bouwerie Iconic News / Elizabeth Kaneko, Wald Real Estate Associates

Park Lane Management / M. Gleicher, D. Weissberg, Winick Realty

The café signed a lease.

2233 Broadway

1,400

Sunburger LLC / R. Bergman, R. Abrams, S. Haddad, Lansco Corp.

Friedland Properties / Represented in-house

The burger shop signed a 10-year lease.

101 Maiden Ln

1,325

Field’s Chicken / Ben Birnbaum, NGKF

201 Pearl LLC / S. Baker, A. Fishbein, Winick Realty

The restaurant signed a lease.

264 West 40th St

1,250

Caffe Bene & Yorganic / BLU Realty Group

n/a / n/a

The eatery signed a lease.

141 Court St (Brooklyn)

1,200

Shelsky’s Smoked Fish / n/a

n/a / Joseph Colista, Massey Knakal

The seafood market signed a lease.

2533 Frederick Douglass Blvd

1,200

Rite Check / M. Mahony, C. Walther, Ripco Real Estate

2533 Frederick Douglass Blvd. LLC / M. Mahony, C. Walther, Ripco Real Estate

The check-cashing services provider signed a 10-year lease.

179 Second Ave

1,200

Joyful Eats / Taryn Brandes, SCG Retail

14 L. Pierre Associates / Josh Siegelman, Winick Realty

The restaurant signed a lease.

147 West 35th St

1,200

7th Avenue Stationers / Richard Smith, Winick Realty

Masar Properties / Richard Smith, Winick Realty

The stationery store signed a lease.

959 Southern Blvd (The Bronx)

1,125

Streetwear / Bunny Escava, Kassin Sabbagh Realty

949-959 Southern Blvd LLC / n/a

The clothing retailer signed a lease. The reported asking rent was $100 per square foot.

2058 Seventh Ave (The Bronx)

1,100

123rd Street Deli / Dan McVeigh, KZA Realty

Yuco Management / Dan McVeigh, KZA Realty

The deli signed a 15-year lease.

2-10 50th Ave (Queens)

1,061

Beans, Grapes & Leaves / Tom Elferis, Manhattan Commercial Group

50-01 2nd Street / H. Shapiro, A. Fishbein, Winick Realty

The wine bar signed a lease.

71 Nassau St

1,000

Green Pea / Albert Manopla, Kassin Sabbagh Realty

71 Nassau Street LLC / Albert Manopla, Kassin Sabbagh Realty

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

37 East 29th St

1,000

Pink Rose / Albert Manopla, Kassin Sabbagh Realty

J&TSAI Inc. / Albert Manopla, Kassin Sabbagh Realty

The spa signed a 10-year lease. The reported asking rent was $65 per square foot.

100 Park Ave

1,000

Choza Taqueria / Ross Burack, Winick Realty

SL Green / Jeff Roseman, NGKF

The restaurant signed a lease for its third location.

7 Cleveland Pl

950

Paul Fox Inc. / Joe Robinson, Bond NY

Coral Broome Street / A. Fishbein, D. Rubens, Winick Realty

The salon signed a lease.

55 Greenwich Ave

900

Blue Stone Lane / RKF

n/a / RKF

The coffee shop signed a lease.

648 Manhattan Ave (Brooklyn)

900

Xi’an Famous Foods / n/a

n/a / Joseph Colista, Massey Knakal

The restaurant signed a lease.

104 May 2014 www.TheRealDeal.com

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“Has perfectly captured the zeitgeist” - BLOOMBERG

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“Avenues has taken Manhattan by storm.”

- NEW YORK TIMES

“If Leonardo Da Vinci had built a school, it would be Avenues: The World School.”

“A New Species of School”

- MILK (Paris)

- ITALIAN VOGUE

“The idea behind Avenues is to build and export a model school for the world.”

“Equipping pupils to prosper in the global economy is at the core of the Avenues curriculum.”

- JORNAL DA GLOBO

- THE ECONOMIST

* Reprinted from THE WALL STREET JOURNAL. ® 2012 Dow Jones & Company, Inc. All Rights Reserved.

- CHINA DAILY

To learn more about Avenues and fall 2014 admissions, please visit avenues.org or call 646.664.0800.

Retail leases continued Address

Size

Tenant / Representative

Landlord / Representative

Notes

70-38 Austin St (Queens)

800

NXT Sports Nutrition / M. Mahony, C. Walther, Ripco Real Estate

Center Continental Properties LLC / Paul Mandel, Forest Hills Property Group

The health and wellness products retailer signed an eight-year lease.

636 Classon Ave (Brooklyn)

800

The Stomping Ground LLC / n/a

636 Classon Avenue Associates LP / M.C. O’Brien

The community center signed a lease.

33 Greenwich Ave

750

Nail Spa 33 Inc. / Steve Rappaport, Sinvin Real Estate

Talia Management Co. LLC / Represented in-house

The nail salon and spa signed a 10-year, three-month lease. The reported asking rent was $128 per square foot.

577 Second Ave

700

Subway / Josh Siegelman, Winick Realty

ELK 577 Second LLC / Josh Siegelman, Winick Realty

The sandwich chain signed a lease.

1433 First Ave

700

Perfect Brows / Albert Manopla, Kassin Sabbagh Realty

BS Realty / n/a

The threading salon signed a 10-year lease. The reported asking rent was $125 per square foot.

1585 Flatbush Ave (Brooklyn)

600

Grand Optical / A. Kassin, A. Manopla, Kassin Sabbagh Realty

1585 Flatbush LLC / A. Kassin, A. Manopla, Kassin Sabbagh Realty

The eyewear retailer signed a lease. The reported asking rent was $150 per square foot.

128 Charles St

600

Claire Chan / J. Bowling, J. Isbitt, Sinvin Real Estate

Mojo Coffee / Amie Claps, Lansco Corp.

The restaurant signed a five-year lease. The reported asking rent was $90 per square foot.

10 Bedford Ave (Brooklyn)

500

Ad Hoc / V. Sweeney, T. Dow, Gotham City Group

Sophie Bednarczyk / n/a

The clothing boutique signed a lease for its second location.

260 West 72nd St

480

Invite Health / Melinda Miller, Winick Realty

Walsam East 72nd / M. Miller, C. Goulakos, Winick Realty

The vitamin store signed a lease.

186 Fifth Ave

465

Pinkyotto / Charles Rapuano, Winick Realty

186 Fifth LLC / Melinda Miller, Winick Realty

The clothing store signed a lease.

330 East 85th St

458

Sarah Choi-Kim / David Rosen, AC Lawrence

330 East 85th Street / Josh Siegelman, Winick Realty

The laser skin care specialist signed a lease.

139 Norfolk St

450

Junior Projects LLC / Tijana Masic, Misrahi Realty

Storefront 139 Inc. / Daniel Barcelowsky, Misrahi Realty

The art gallery signed a lease.

188 Orchard St

400

Grand Equities of Ny Inc. / Tijana Masic, Misrahi Realty

188 Orchard Street Corp. / Yesim Ak, Misrahi Realty

The deli and grocery store signed a lease.

394 East 149th St (The Bronx)

400

Big Boy / Albert Manopla, Kassin Sabbagh Realty

n/a / Albert Manopla, Kassin Sabbagh Realty

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

13 East Fordham Rd (The Bronx)

400

Perfect Brows / Albert Manopla, Kassin Sabbagh Realty

ISJ Management Corp. / Albert Manopla, Kassin Sabbagh Realty

The threading salon signed a 10-year lease. The reported asking rent was $250 per square foot.

205 West 57th St

371

Two Angels Ina Inc. / n/a

Jack Resnick & Sons / n/a

The jeweler signed a lease.

238 Ninth Ave

350

Perfect Brows / Albert Manopla, Kassin Sabbagh Realty

Aimco / n/a

The threading salon signed a 10-year lease. The reported asking rent was $171 per square foot.

667 Classon Ave (Brooklyn)

300

Caffe Vita Inc. / n/a

Classon Village LP / M.C. O’Brien

The café signed a lease.

420 Fifth Ave

200

Hole in the Wall Coffee / n/a

L Train Capital LLC / D. Chu, E. Chuang, L Train Capital LLC

The coffee shop signed a 10-year triple-net lease with a five-year option to renew.

RD NY ad.pdf

1

4/21/14

106 May 2014 www.TheRealDeal.com

12:22 PM

StevenG_RDNY10.13_Layout 1 10/31/13 3:25 PM Page 1

FLORIDA 2818 Center Port Circle Pompano Beach, FL 33064 P 954.735.8223 F 954.735.7546 100,000 sq ft showroom Multi lingual design firm FL State Licensed Designer #000407 NEW YORK 221 East 60th Street New York, NY 10022 P 212.644.3403 F 212.644.4236 www.interiorsbysteveng.com www.antiquitiesweb.com DESIGNS WORLDWIDE

Buys Address

Size

Buyer / Representative

Seller / Representative

Notes

55 Broadway

32-story, 358,637 sf office bldg

Harbor Group International / n/a

Broad Street Development / n/a

The property sold for $157 million. The building is 90 percent leased.

817 Lexington Ave

2 retail condos, 47,197 sf total

n/a / n/a

n/a / C. Olsen, B. Knakal, Massey Knakal

The properties sold for $48.2 million, or $1,021 per square foot. The price represents a capitalization rate of 2.3 percent.

396-398 Broadway

10-story, 60,000 sf office bldg

n/a / n/a

n/a / Christen Portelli, Highcap Group

The property sold for $42 million.

Bronx portfolio

11 apt. bldgs, 331 units total

n/a / Michael Guttman, Rosewood Realty

Mohegan Crotona Associates / A. Jungreis, M. Kerwin, Rosewood Realty

The properties sold for $40 million. The price represents a gross rent multiple of 7.4. The buildings are located at 2078 and 2074 Crotona Parkway; 2132 and 2140 Daly Avenue; 1895 Belmont Avenue; 2146 Vyse Avenue; 968, 984 and 990 Bronx Park South; and 2075 and 2079 Mohegan Avenue.

3351-3359 and 3420-3428 Broadway

Two 6-story apt. bldgs, 80 units total

Cob 3351 Broadway LLC / Aaron Jungreis, Rosewood Realty

Bldg Oceanside LLC / Aaron Jungreis, Rosewood Realty

The properties sold for $27 million.

37 East 12th St

8-story, 25,878 sf office bldg

n/a / n/a

n/a / M. Levine, J. Nelson, Massey Knakal

The property sold for $26.6 million, or $1028 per square foot.

151 Bowery and 331-333 Broome St

42,000 sf of air rights

n/a / n/a

n/a / Jan Sasson, E Property Group

An assemblage of buildings sold for $23.5 million, or $560 per square foot.

455 West 19th St

27,692 buildable sf development site

n/a / n/a

n/a / Brock Emmetsberger, Massey Knakal

The property sold for $22.5 million, or $813 per buildable square foot.

150 East 72nd St

4,000 sf retail bldg

RFR Realty / n/a

Macklowe Properties / H. Hwang, N. Rockett, S. Kohn, K. Wiedenmann, J. LiGreci, C&W

The property sold for $19.9 million.

45 Orchard St

7-story apt. bldg

n/a / n/a

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

The loft building sold for $16.1 million, or $1,006 per square foot.

63 Spring St

5,000 sf apt. bldg

Spring Lafayette LLC / Marc Finkel, RKF

Silvershore Properties / J. Fishman, J. Butwin, RKF

The vacant property sold for $15 million, or $3,000 per square foot.

145 Avenue A

6-story mixed-use bldg

n/a / HPNY

n/a / HPNY

The property sold for $12.8 million.

327 East 22nd St

4-story, 12,737 sf comm. bldg

SCPD Gramercy 1 LLC / Colby Swartz, Suzuki Capital LLC

Green Chimneys School / n/a

The property sold for $11.5 million.

36-38 Park Row

12,918 sf retail co-op

Thor Equities / Ivan Hakimian, Hakimian Properties

Time Equities / Represented in-house

The retail co-op sold for $11.08 million.

102 Norfolk St

6-story mixed-use bldg

n/a / n/a

East Side Management Enterprises / Michael DeCheser, Massey Knakal

The property sold for $11 million, or $688 per square foot.

2255 Grand Concourse (The Bronx)

6-story apt. bldg, 68 units total

Parkash 2255 LLC / Aaron Jungreis, Rosewood Realty

2255 Concourse LLC / Aaron Jungreis, Rosewood Realty

The property sold for $10.8 million.

1530 Sheridan Ave (The Bronx)

6-story apt. bldg, 84 units total

Parkash 1530 LLC / Amit Doshi, Besen & Associates

1530 Sheridan Av E LLC / A. Doshi, Besen & Associates; L. Capin, Capin & Associates

The property sold for $10.45 million, or $109 per square foot.

14-01, 14-07 and 14-19 Broadway (Queens)

78,000 buildable sf development site

n/a / S. Shkury, H. Raber, V. Sozio, M. Tortorici, Ariel Property Advisors

n/a / S. Shkury, H. Raber, V. Sozio, M. Tortorici, Ariel Property Advisors

The properties sold for $10.23 million.

2701 Webb Ave and 131 West Kingsbridge Rd (The Bronx)

Two 6-story apt. bldgs, 70 units total

n/a / Aaron Jungreis, Rosewood Realty

131 Ellsworth Enterprises LLC; 2701 Charlojack LLC / Aaron Jungreis, Rosewood Realty

The contiguous buildings sold for $10 million. The price represents a gross rent multiple of 7.7.

820-830 Riverside Dr

5-story apt. bldg, 46 units total

FIYA RSD Partners LLC / A. Doshi, S. Mehra, Besen & Associates

820-830 Riverside LP / A. Doshi, S. Mehra, Besen & Associates

The walk-up sold for $9.4 million, or $184 per square foot. The price represents a capitalization rate of 4 percent and a gross rent multiple of 13.3.

350 and 352 Third Ave

14,000 sf mixed-use bldg

n/a / HPNY

n/a / HPNY

The property sold for $9.3 million.

283 Albany Ave (Brooklyn)

58,000 sf apt. bldg, 53 units total

Silvershore Properties / Represented in-house

Hoydu Realty Corp. / n/a

The elevator building sold for $8.8 million.

213 West 28th St

5-story apt. bldg, 16 units total

28 Street Holdings LLC / n/a

213 West 28th Street LLC / D. Berger, M. Kerwin, Rosewood Realty

The property sold for $7.4 million. The price represents a gross rent multiple of 13.

278 Flushing Ave and 11, 15 and 17 Grand Ave (Brooklyn)

Development site

n/a / A. Shmaruk, M. Sherman, Manhattes Group

n/a / A. Shmaruk, M. Sherman, Manhattes Group

The industrial parcels sold for $7 million, or $155 per buildable square foot.

540-542 West 157th St

43-unit apt. bldg

n/a / V. Sozio, S. Shkury, M. Tortorici, J. Deutch, Ariel Property Advisors

n/a / V. Sozio, S. Shkury, M. Tortorici, J. Deutch, Ariel Property Advisors

The property sold for $6.9 million.

345 East 104th St

5-story apt. bldg

n/a / n/a

n/a / H. Oster, L. Kimyagorov, Massey Knakal

The property sold for $6.75 million, or $280 per square foot.

3728 Avenue K (Brooklyn)

4-story apt. bldg, 58 units total

n/a / Aaron Jungreis, Rosewood Realty

3728 Ave. K LLC / Aaron Jungreis, Rosewood Realty

The walk-up sold for $6.6 million. The price represents a gross rent multiple of 9.6.

49 East 21st St

6,500 sf retail condo

Xerxes Group / Michael Cleeman, Cohen Real Estate

n/a / Michael Cleeman, Cohen Real Estate

The property sold for $6.5 million.

8220 Fort Hamilton Pkwy (Brooklyn)

4-story apt. bldg, 37 units total

n/a / Erik Yankelovich, GFI Realty

n/a / Erik Yankelovich, GFI Realty

The property sold for $5.83 million. The price represents a gross rent multiple of 11.

1717 Avenue N (Brooklyn)

43 res. units

n/a / n/a

n/a / N. Mahedy, J. Ciraulo, Massey Knakal

A package of 43 unsold shares in the co-op building sold for $5.7 million, or $146 per square foot.

361 First Ave

4-story, 5,000 sf mixed-use bldg

First Avenue Assets LLC / Amit Doshi, Besen & Associates

Jtu Managament In C / Shoy McKen, Besen & Associates

The property sold for $5.6 million, or $1,099 per square foot.

2500 Coney Island Ave (Brooklyn)

2-story retail bldg

Francman Realty LLC / M. Cleeman, R. Kaiser, Cohen Real Estate

2500 Coney Island Avenue Associates LLC / M. Cleeman, R. Kaiser, Cohen Real Estate

The property sold for $5.43 million.

2021 Lexington Ave

5-story apt. bldg, 12 units total

2021 Lexington LLC / Amit Doshi, Besen & Associates

2021 Lexington Ave Realty LLC / Amit Doshi, Besen & Associates

The property sold for $4.3 million, or $256 per square foot.

570 West 182nd St

5-story apt. bldg, 25 units total

n/a / Amit Doshi, Besen & Associates

568-572 W182nd St LLC / Amit Doshi, Besen & Associates

The property sold for $4.25 million, or $340 per square foot.

45 Horatio St

4-story multi-family townhouse

n/a / n/a

n/a / R. Burton, J. Nelson, Massey Knakal

The property sold for $4.1 million, or $1,192 per square foot.

92 East Broadway

8,495 sf apt. bldg, 8 units total

92 East LLC / Yesim Ak, Misrahi Realty

The Third Dynasty Realty Corp. / Daniel Barcelowsky, Misrahi Realty

The property sold for $4 million.

108 May 2014 www.TheRealDeal.com

FULL FLOORS At Grand Central.

On Park Avenue.

Beyond Expectation.

E N T I R E

2 6 T H

F L O O R

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9 , 6 0 0

R S F

E N T I R E

2 3 R D

F L O O R

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9 , 6 0 0

R S F

E N T I R E 1 6 T H F L O O R - 2 4 , 5 0 6 R S F Q U A L I T Y P R E B U I L D S A L S O AVA I L A B L E F R O M 3 , 2 1 6 - 1 4 , 2 0 6 R S F For leasing i n f o r m a ti o n , pl eas e c o nt ac t : Paul N. Glickman | Paul.Glickman@am.jll.com | 212.418.2646 Diana L. Biasotti | Diana.Biasotti@am.jll.com | 212.812.5751 Harley G. Dalton | Harley.Dalton@am.jll.com | 212.812.5838 Copyright Š Jones Lang LaSalle IP, Inc. 2014. All rights reserved. No part of this publication may be reproduced by any means, whether graphically, electronically, mechanically or otherwise howsoever, including without limitation photocopying and recording on magnetic tape, or included in any information store and/or retrieval system without prior written permission of Jones Lang LaSalle IP, Inc. Jones Lang LaSalle Brokerage, Inc., California license # 01856260. Jones Lang LaSalle Americas, Inc., California license # 01223413.

Buys continued Address

Size

Buyer / Representative

Seller / Representative

Notes

401 12th St (Brooklyn)

6-unit apt. bldg

n/a / n/a

n/a / A. Hess, C. Pechlivanides, S. Shalumov, TerraCRG

The property sold for $4 million, or $800 per square foot.

244 Madison St (Brooklyn)

4-story apt. bldg, 8 units total

n/a / n/a

n/a / M. Cosentino, E. Satanovsky, TerraCRG

The property sold for $3.65 million, or $391 per square foot.

161 East 32nd St

2-story, 4,719 sf comm. bldg

n/a / n/a

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

The property sold for $3.6 million, or $763 per square foot.

27 East 20th St

2-unit apt. bldg

Silvershore Properties / n/a

AY & Associates / n/a

The property sold for $3.3 million.

5823-25 Myrtle Ave (Queens)

4,264 sf mixed-use bldg

n/a / Yona Edelkopf, Itzhaki Properties

n/a / M. Rybinskov, B. Edelkopf, Itzhaki Properties

The property sold for $3.25 million.

117 First Ave

4-story apt. bldg

n/a / Jeff Weiss, Highcap Group

n/a / Jeff Weiss, Highcap Group

The property sold for $3 million, or $1,000 per square foot.

1516-32 Park Ave

27,597 buildable sf development site

n/a / n/a

n/a / Shay Zach, Itzhaki Properties

The vacant lot sold for $2.73 million.

10309 Glenwood Rd (Brooklyn)

1-story, 7,560 sf retail bldg

n/a / n/a

n/a / Edward Gevinski, Massey Knakal

The property sold for $2.65 million, or $351 per square foot.

114 Field Pl (The Bronx)

5-story apt. bldg, 27 units total

n/a / Alan Zucco, Besen & Associates

Jang Mgt. LLC; Sean Realty Mgt. LLC; Gaby Mgt. LLC / A. Doshi, R. Shaban, Besen & Associates

The property sold for $2.6 million, or $120 per square foot.

382 South 4th St (Brooklyn)

8-unit apt. bldg

n/a / Marcel Fridman, Barcel Group

n/a / Marcel Fridman, Barcel Group

The property sold for $2.55 million, or $425 per square foot.

2849 Webb Ave (The Bronx)

5-story apt. bldg, 28 units total

n/a / A. Doshi, L. Blumberg, Besen & Associates

2849 Webb LLC / A. Doshi, L. Blumberg, Besen & Associates

The property sold for $2.55 million.

336 East 112th St

20,184 buildable sf development site

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

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

The property sold for $2.48 million.

1882 Third Ave

4-story, 6,500 sf apt. bldg

n/a / n/a

n/a / L. Kimyagarov, J. Nelson, Massey Knakal

The property sold for $2.48 million, or $377 per square foot.

2460 Flatbush Ave (Brooklyn)

12,000 sf office bldg

2460 Flatbush Avenue LLC / One World Property Advisors

Budget Wines & Liquors Inc. / M.C. O’Brien

The medical office building sold for $2.4 million.

461 DeKalb Ave (Brooklyn)

8-unit apt. bldg

Silvershore Properties / n/a

n/a / n/a

The property sold for $2.3 million.

629 Grand St (Brooklyn)

4-story apt. bldg, 3 units total

n/a / Joseph Landau, GFI Realty

n/a / Joseph Landau, GFI Realty

The walk-up sold for $2.3 million.

180 Decatur St (Brooklyn)

3-story apt. bldg, 6 units total

n/a / Yisroel Pershin, GFI Realty

n/a / Yosef Katz, GFI Realty

The property sold for $2.28 million.

1881 Grand Concourse (The Bronx)

6-story apt. bldg, 16 units total

n/a / Aaron Jungreis, Rosewood Realty

1881 Grand Concourse Owner LLC / Aaron Jungreis, Rosewood Realty

The elevator building sold for $1.9 million. The price represents a gross rent multiple of 8.

184 Java St (Brooklyn)

6-unit apt. bldg

n/a / n/a

n/a / M. Lively, B. Maddigan, Massey Knakal

The property sold for $1.7 million, or $412 per square foot.

110 May 2014 www.TheRealDeal.com

C IT Y CENT ER REAL ESTAT E INC. M ANHAT TAN AIR RIGHT S LAND AS SEM BLAGE L AND PLANNING AND M ANHAT TAN D EVELOP ME NT

The Orion Developed by Extell 74,158 sq. ft. of Air Rights 350 West 42nd Street

220 Central Park South Developed by Vornado 41,486 sq. ft. of Air Rights This 920 foot residential development will be designed by Robert M. Stern

The Gershwin Developed by Jack Resnick & Sons 105,545 sq. ft. of Air Rights Transaction included the acquisiton of a 35,500 square foot development site which had 355,000 sq. ft. of FAR

Metropolis at 155 East 44th Street Developed by Benenson/Rose 236.083 sq. ft. of Air Rights Transaction also included the acquisition of 208,093 sq. ft. of FASR

250 West 55th Street Developed by Boston Properties 53,281 sq. ft. of Air Rights

Random House 1745 Broadway Developed by Related 254,140 sq. ft. of Air Rights The Air Rights were acquired in 15 separate transactions for this 729,592 sq. ft. mixed use project made up 34.83% of the total GSF of the project

Drake Site, 432 Park Ave Developed by Macklowe Organization 92,179 sq. ft. of Air Rights 1.395 sq. ft. tallest building in NYC and tallest residential development in western hemisphere

1113 York Avenue Developed by the Solow Organization 40,166 sq. ft. of air rights

1800 Park Avenue 126,881 sq. ft. of TDRs. City Center Real estate representing the College of Podiatric Medicine and sold to Vornado. Vornado sold the site to Continuum who will be building two 32-story towers that will be the tallest buildings in Harlem.

340 Madison Avenue 55,000 sq. ft. of TDRS. Acquired for the Macklowe Organization in four separate transactions that involved the acquisition of 55,000 square feet of TDRs from adjacent properties.

237 West 54th Street Acquisition of 25,000 sq. ft. of TDRs generated under the Special Midtown Theater sub-district. Earlier this year the Moinian Group opened up the 34 story, 170,103 sq. ft Hilton Garden Hotel.

Architect: Gene Kaufman

1150 Avenue of the Americas 29,000 sq. ft. of TDRs 5 Star hotel, full service plus retail.

Gross buildable: 180,000 sq. ft.

Nearly 300 suites/rooms. Being built

by Morris Moinian of Fortuna Realty Group.

Robert I. Shapiro, Founder and President of City Center Real Estate Inc., is widely recognized as one of Manhattans leading experts on land assemblage and development rights transactions.Clients have included some of the biggest developers and owners in New York City real estate from Avalon Bay to Zeckendorf.

1 0 1 0 5 TH AV E , NEW YOR K , NY 10028 | ( 212) 396-9705 | RISCIT YCE NT E R @ E A R T HL I NK .NE T

Buys continued Address

Size

Buyer / Representative

Seller / Representative

Notes

236 Howard Ave (Brooklyn)

6-unit apt. bldg

Silvershore Properties / n/a

Adar Properties Corp. / n/a

The property sold for $1.3 million.

495 Quincy St (Brooklyn)

4-story apt. bldg, 16 units total

n/a / Aaron Jungreis, Rosewood Realty

n/a / Aaron Jungreis, Rosewood Realty

The walk-up sold for $1.3 million. The price represents a gross rent multiple of 10.

334 Chauncey St (Brooklyn)

12-unit apt. bldg

n/a / n/a

n/a / Yona Edelkopf, Itzhaki Properties

The property sold for $1.25 million.

Financing Address

Size

Borrower / Representative

Lender / Representative

Notes

55 Broadway

358,637 sf office bldg

Harbor Group International / Shawn Rosenthal, CBRE

JPMorgan / n/a

A $105 million loan was provided for the acquisition of the property.

300 West 22nd St

81-room hotel

Icon Realty Management / J. Ray, J. Cohen, A. Hirt, Misson Capital Advisors

Ladder Capital / n/e

A $33 million first mortgage and mezzanine financing was secured to refinance the GEM Hotel. The loan replaces an initial $22 million mortgage that closed in January 2012.

99-32/52/72 66th Rd (Queens)

481 res. units

The Howard Owners Inc. / n/a

NCB / n/a

A $21.5 million first mortgage and a $1.5 million line of credit were arranged for the property.

170-180 Park Row

239-unit apt. bldg

Chatham Towers Inc. / n/a

NCB / n/a

A $3.7 million first mortgage and a $1 million line of credit were arranged for the building.

333 West End Ave

48-unit apt. bldg

333 West End Tenants Corp. / n/a

NCB / n/a

A $3.5 million first mortgage and a $500,000 line of credit were arranged for the building.

321 East 54th St

101-unit apt. bldg

321 Apartments Corp. / n/a

NCB / n/a

A $3 million first mortgage and a $500,000 line of credit were arranged for the building.

929 Park Ave

38-unit apt. bldg

929 Park Avenue Apartment Corp. / n/a

NCB / n/a

A $2.6 million first mortgage and a $500,000 line of credit were arranged for the building.

90 Park Terrace East

48-unit apt. bldg

Park Terrace Manor Inc. / n/a

NCB / n/a

A $1.5 million first mortgage and a $250,000 line of credit were arranged for the building.

5 Riverside Dr

100-unit apt. bldg

5 Riverside Corporation / n/a

NCB / n/a

A $1 million line of credit was arranged for the building.

I made comprehensive energy upgrades. Now, my multifamily building is in demand.

When tenants are happy, word gets around. So I’m always looking for ways to make my multifamily building more marketable. With comprehensive energy upgrades through the New York State Energy Research and Development Authority’s (NYSERDA) Multifamily Energy Performance Portfolio, I can offer lower energy bills, plus a more comfortable, more environmentally responsible place to live year-round. And with an average annual return on investment of 22%, I feel pretty comfortable, too.

MEPP-OWN-go-ad-2-v2

Learn more and get started.

Visit nyserda.ny.gov/TheRealDeal-better-living

To view more deals visit our website: www.TheRealDeal.com 112 May 2014 www.TheRealDeal.com

RESIDENCES DESIGNED for LIFE

Introducing a Limited Collection of Exquisite Condominium Residences.

Designed by Piero Lissoni. Priced from approximately $2 million to over $25 million.

On-site sales gallery now open. 4701 North Meridian Avenue, Miami Beach For a Private Appointment, Please Call 888-944-4928.

TheResidencesMiamiBeach.com

Developer 4701 North Meridian, L.L.C. Address: 4218 NE 2nd Avenue, Miami, FL Premier Sales Group, Inc. a Licensed Real Estate Broker is the Exclusive Sales Agent. • ONE Sotheby’s International Realty, Global Marketing Partner.

The Ritz-Carlton Residences, Miami Beach are not owned, developed or sold by The Ritz-Carlton Hotel Company, L.L.C. or its affiliates (“Ritz-Carlton”). 4701 North Meridian, L.L.C. uses The Ritz-Carlton marks under a license from Ritz-Carlton, which has not confirmed the accuracy of any of the statements or representations made herein. This graphic is an “artist’s rendering” and is for conceptual purposes only. THIS OFFERING IS MADE ONLY BY THE OFFERING DOCUMENTS FOR THE CONDOMINIUM AND NO STATEMENT SHOULD BE RELIED UPON IF NOT MADE IN THE OFFERING DOCUMENTS. THIS IS NOT AN OFFER TO SELL, OR SOLICITATION OF OFFERS TO BUY, THE CONDOMINIUM UNITS IN STATES WHERE SUCH OFFER OR SOLICITATION CANNOT BE MADE. PRICES, PLANS AND SPECIFICATIONS ARE SUBJECT TO CHANGE WITHOUT NOTICE. OBTAIN THE PROPERTY REPORT REQUIRED BY FEDERAL LAW AND READ IT BEFORE SIGNING ANYTHING. NO FEDERAL AGENCY HAS JUDGED THE MERITS OR VALUE, IF ANY, OF THIS PROPERTY. ORAL REPRESENTATIONS CANNOT BE RELIED UPON AS CORRECTLY STATING THE REPRESENTATIONS OF THE DEVELOPER. FOR CORRECT REPRESENTATIONS, REFERENCE SHOULD BE MADE TO THE DOCUMENTS REQUIRED BY SECTION 718.503, FLORIDA STATUTES, TO BE FURNISHED BY A DEVELOPER TO A BUYER OR LESSEE. NEW YORK RESIDENTS This advertisement is not an offering. It is a solicitation of interest in the advertised property. No offering of the advertised units can be made and no deposits can be accepted, or reservations, binding or non-binding, can be made until an offering plan is filed with the New York State Department of Law. This advertisement is made pursuant to Cooperative Policy Statement No. 1, issued by the New York State Department of Law. CP14-0017

Date: March 28, 2014

File Name: Ritz_Miami_RealDeal_140401_HR.pdf

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Other Deals New York investor snaps up Mobil building for over $900 million

150 East 42nd Street

New York investor David Werner is in contract to purchase the trophy Mobil building on East 42nd Street for more than $900 million. Werner snagged the 42-story tower at 150 East 42nd Street, built in the 1950s, from seller Hiro Real Estate LLC, according to the Wall Street Journal. Goldman Sachs Group was also instrumental in the sale, because it holds a significant chunk of debt on the building, people familiar with the deal told the Journal. The 1.8 million-square-foot property was listed for sale in March by Eastdil Secured, with brokers Douglas Harmon and Adam Spies handling the listing. (The deal was announced after the deadline for the Deal Sheet.)

388 Greenwich Street

335 Madison Avenue

Milstein Properties is teaming up with business incubator Grand Central Tech in hopes of kicking off a thriving startup community in Midtown East, in a space that once served as Facebook’s New York offices.

Landlord and developer Milstein is donating 15,000 square feet of space at 335 Madison Avenue, across from Grand Central Terminal between East 44th and East 43rd streets, to hold 12 to 18 fledgling startups, according to reports. The ultimate goal, Grand Central Tech’s organizers said, is to extend the trend of tech firms populating loft-like spaces beyond current hotspots like the Flatiron District and Chelsea.

Cushman & Wakefield lands big Citigroup contract

Startup marketer signs on at Lightstone’s 1407 Broadway

In a quiet deal, banking behemoth Citigroup has tapped Manhattan-based Cushman & Wakefield to manage all 27 million square feet of the company’s commercial property in the U.S., including its Tribeca headquarters. The agreement reportedly means Cushman will replace real estate firm JLL, formerly known as Jones Lang LaSalle, as the sole U.S. facilities manager. That includes management of the financial giant’s headquarters in the 39-story office tower at 388 Greenwich Street. JLL didn’t pursue the contract, the Wall Street Journal reported. The firm will continue to manage Citigroup’s properties in Mexico, according to the article.

Texas-based marketing platform developer Main Street Hub inked a lease for 13,700 square feet at Lightstone Group’s 1407 Broadway, between 38th and 39th streets. The 1.1 million-squarefoot, 42-story property, also owned by real estate investment trust Lightstone Value Plus REIT, is being renovated at the moment. The tenant will leave behind 1201 Broadway and head north, occupying the entire 26th floor of 1407 Broadway. A CBRE broker team including Peter Turchin, Ben Fastenberg, Lee Cross, Amanda Bokman, Ross Zimbalist and Gregg Rothkin serves as the leasing agent for Lightstone. Brian Hay, Timothy Hay and Rob Hill, also of CBRE, represented Main Street Hub. (The deal was announced after the deadline for the Deal Sheet.)

Google searching for another 600K square feet of office space

111 Eighth Avenue

Less than a month after signing for an extra 75,000 square feet at Chelsea Market, Google wants more. The tech giant is in talks to lease up to 600,000 square feet in Manhattan. This level of office space expansion would mark an 80 percent growth in the company’s operations, according to reports. Google’s New York offices currently are based at 111 Eighth Avenue and inside Chelsea Market. Two potential new office outposts could be the New York Daily News’ former digs at Brookfield Office Properties’ 450 West 33rd Street, or the former freight rail terminal which is now Eugene Grant’s St. John’s Terminal Building at 550 Washington Street.

Victor Sozio

Milstein donates former Facebook office to startup incubator

Extell makes deal for Harlem Pathmark official

Extell Development has officially purchased a 68,676-square-foot East Harlem retail property home to a Pathmark supermarket, The Real Deal has learned. The building, at 142-96 East 125th Street, is under a long-term lease with Pathmark and includes approximately 300,000 square feet of residential air rights and over 450,000 total buildable square feet with inclusionary housing bonuses. Extell secured the site for $39 million. Victor Sozio, Shimon Shkury and Michael Tortorici of Ariel Property Advisors represented the seller, the East Harlem Abyssinian Triangle Limited Partnership, and procured the buyer. (The deal was announced after the deadline for the Deal Sheet.)

Morris Bailey’s JEMB buys Brooklyn lot for $38.5M JEMB Realty picked up a Brooklyn parking lot with 185,000 buildable square feet for nearly $38.5 million. The lot at 420428 Albee Square sits across the street from the City Point megadevelopment in Downtown Brooklyn. The Girard family owned it for years, while a parking operator held a long-term lease. CPEX brokers Sean Kelly and Timothy King represented the sellers in the deal, which closed at $205 per buildable square foot. The buyer also owns 75 Broad Street, which gained new tenants in TV production company NorthSouth Productions and pasta company De Cecco earlier this year.

(The deal was announced after the deadline for the Deal Sheet.)

Timothy King

Big East inks lease at Durst’s 655 Third Avenue The Big East Conference, the collegiate league which competes in NCAA Division I sports, has landed an office at Durst Organization’s Midtown East tower at 655 Third Avenue. The 10-year lease covers the 13,740-square-foot seventh floor, which will undergo a full renovation. Asking rent for the space is $54 per square foot, according to CoStar Group data cited by the New York Post. Durst leasing associate Karen Kuznick represented the landlord in-house, while Newmark Grubb Knight Frank brokers Jeffrey Rosenblatt and Bill Harvey represented the tenant.

(The deal was announced after the deadline for the Deal Sheet.)

To view more deals visit our website: www.TheRealDeal.com 114 May 2014 www.TheRealDeal.com

1407 Broadway

655 Third Avenue

TRD

Development updates SALES UPDATES

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150 East 72nd Street

Harlem The Adeline 45 West 116th Street

The 83-unit, 12-story condominium building, developed by L+M Development Partners is now 65 percent sold. The building features one- to four-bedroom residences that range in size from 1,046 to 1,912 square feet. Only two-, three- and four-bedroom units remain and are available from $1.11 million. The building features a 24-hour doorman, a children’s playroom, fitness center, a resident lounge and two levels of shared outdoor space. Halstead Property Development Marketing is the agent.

Contact: 212-486-3916.

The 22-unit residential building, developed

by Macklowe Properties, is now 80 percent sold and in contract. The building features two-, three- and four-bedroom residences.

All remaining units are four-bedroom residences that range in size from 3,543 to 3,662 square feet, and range in price from $8.5 to $15.5 million. The building features a fitness center, children’s playroom and multipurpose room. Sotheby’s International Realty is the agent. Contact: www.150east72.com or 212-545-5000.

LEASING UPDATE

South Slope

Greenwood on Fourth 683 Fourth Avenue

Upper East Side 155 East 79th Street

SIDNEY JOYNER Vice President SIDNEY@CTNYC.COM Ext. 104

29-27 41st Avenue | Long Island City, NY | 11101 T. 718-937-8100 | F. 718-937-8124 WWW.CTNYC.COM 116 May 2014 www.TheRealDeal.com

The 24-story, 55-unit residential building, developed by Alchemy Properties, and designed by FXFowle, is more than 60 percent sold. The building now has fewer than 20 three- and four-bedroom residences available. The units range in size from 2,005 to 3,831 square feet, and in price from $5.45 to $12.65 million. The building’s seventh floor is dedicated to amenities including a lounge with billiards and personal wine storage for each owner. Other amenities include a fitness center and an outdoor terrace. Douglas Elliman is the agent. Contact: www.35xv.com or call 212-244-3515.

full-floor residences, including five duplex units with five bedrooms, a three-level penthouse with five bedrooms and a duplex maisonette with 4 bedrooms. The units range from 3,300 to 4,500 square feet, with pricing estimated from $8.95 million to over $18 million. Each unit features direct elevator entry, wood-burning fireplaces and custom marble flooring.

The building has a 24-hour doorman, a fitness center and individual storage rooms.

Corcoran Sunshine Marketing Group is the agent. Contact: www.155east79.com or 212-725-7979.

Sales launched at the 7-unit, 14-story residential building, developed by Anbau, and designed by Andrew Sheinman of Pembrooke & Ives. The building features seven

The 16-unit rental building, developed

by Ideal Properties Group, is now 90 percent leased. The building consists of studios and two-bedroom apartments that range in size from 402 to 819 square feet.

Monthly rents range in price from $1,800 to $2,200 for studio residences and $3,000 to $3,400 for two-bedroom apartments.

The building features an outdoor lounge, a tenant recreation room, month-to-month storage spaces and bicycle parking. Ideal Properties Group is the agent. Contact: greenwood4th.idealpropertiesgroup.com or 718-840-2757. TRD

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RESIDENTIAL DEALS Murray Hill $1.73 million 415 East 37th Street, Apt. 6GH

Three-bedroom, two-bath, 1,629-squarefoot unit in the Horizon condominium building. Apartment has views of the East River and United Nations, marble bathrooms and granite counters; building has a doorman and concierge. Common charges $1,709 per month, taxes $1,681 per month.

Asking price $1.8 million; 15 weeks on the market. (Brokers: Dan Geller and Natasha Ulyanov, Keller Williams; Ajay Sharma, City View Real Estate) “This is not necessarily the easiest location — it’s near the Midtown Tunnel, it’s near the water and it’s near First Avenue. It takes a very specific buyer.

We needed an international buyer. The international buyer loves amenities and the amenities in this building are first-rate. There’s a wonderful gym, valet service, they’ll clean your apartment, they do your laundry — it’s like living in a hotel.

The buyer was a very difficult negotiator, but we beat him into submission as we always do. It took six weeks to make this deal with him. The sellers were in a unique position; they had completely outgrown their apartment, and they had another child on the way and had to move. We were under the impression that she wasn’t going to give birth until spring, but she gave birth in January, so we had to orchestrate a balancing act between the new purchase and the sale. I had prepared for this. I made a clause that in case she gave birth early, the couple got to stay in the apartment for an additional three months free of charge. We didn’t think it would happen, but it did.” – Dan Geller, Keller Williams

Turtle Bay $1.08 million 333 East 46th Street, Apt. 9B

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Two bedroom, two-bath, 1,200-square-foot unit in a condop building; apartment has hardwood floors, renovated kitchen and baths; building has storage facilities, roof deck, garden, garage, 24-hour doorman and live-in super. Common charges $1,880 118 May 2014 www.TheRealDeal.com

per month. Asking price $1.13 million, 29 weeks on the market. (Brokers: William Moye, Bond; Sahar Ziv, Douglas Elliman) “Next door to the building is an empty lot, and it’s going to be built on at some point. We were having a bit of trouble because the west-facing windows look over that empty lot. At one point we were afraid that the empty lot would devalue the property too much.

But we finally found a couple that recognized the value of the place. It was exactly what they were looking for in terms of layout, location and space. And even with the empty lot, they really saw the investment potential in this area. There’s renewed interest in this neighborhood. On one corner, the new Zeckendorf development that will have $70 million penthouses is being built. It’s right next to 100 UN Plaza, and across the street from the headquarters of the United Nations. We feel really good about the neighborhood and its long-term outlook.” – William Moye, Bond

Williamsburg $2.35 million 34 North 7th Street, Apt. 3Q

Two-bedroom, two-bath, 1,629-squarefoot duplex unit in a condominium building, the Edge. Apartment’s lower level has an open layout with 18-foot ceilings, floorto-ceiling windows and protected views.

Building has roof deck, fitness center, maid service, pool, 24-hour doorman and concierge. Common charges $1,412 per month.

Asking price $2.35 million, 1 day on the market. (Brokers: Eugene Litvak, Citi Habitats; Susan Wires, Stribling & Associates) “The Edge is the most sought-after luxury condominium in Williamsburg, with an amenity package that rivals none. I have a waiting list of buyers and buyer’s brokers with checkbooks in hand. I’ve spent several years creating relationships in the building and the neighborhood. This unit is a beautiful and truly rare loft, featuring more than 1,600 square feet and unobstructed East River and skyline views. Our ‘drive the market’ approach really worked here, making this the most expensive non-penthouse duplex to ever sell in the building.”

– Eugene Litvak, Citi Habitats

Compiled by Sasha von Oldershausen

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Council speaker from page 46 accommodate only affordable housing and is skeptical that she’ll ever side with property owners in general.

“Landlords should have nightmares about her when they sleep,” Bailey said. “I’m hoping and praying she starts thinking about jobs and an economically vibrant New York, as well as trying to have some buildings be low-to-moderate [income] housing. There should be a balance.”

He added, “her entire agenda is not in line with what has benefited New York in the past.”

In a 2008 webcast with The Real Deal, Bailey debated Mark-Viverito over a proposed tenant protection bill

In-house brokers

that would have prevented landlords from unduly harassing tenants in rent-stabilized apartments. At the time, he claimed the bill, sponsored by Mark-Viverito and Garodnick, would “cause chaos.”

Also a question is how much of a check on the mayor the council will be. Last month, Garodnick said the body should be independent from the mayor in evaluating landuse issues.

“The charter contemplates a significant land-use responsibility for the City Council, separate and apart from any negotiations by the mayor,” he said in a statement.

“That role should not be abdicated.”

Richard Anderson, president of the New York Building Congress, said he’s heard there are a flurry of bills currently being introduced by junior council members that would not have made it to the floor under Quinn. Quinn, he noted, seemed to have been more hands-on.

“My sense is that [Mark-Viverito] is letting council members do more of what they want,” Anderson said.

“She hasn’t done anything I either personally take issue with, or necessarily support,” he added. “She is an enigma so far.” TRD

from page 54

earning an MBA from Washington University in St. Louis.

He acknowledged that, in a good year, a top deal maker at a brokerage may take home a fatter paycheck than he does, but said the choice to remain in-house was about more than money. When courting a tenant, for example, he has the ability to pick from across Brookfield’s portfolio, which helped him sign College Board, the company behind college admission tests like the SAT, to a 145,000-square-foot deal at Brookfield Place in January.

“A broker came to us and asked if we could present the Brookfield portfolio,” Cheikin said. “It allows us to sell them on a variety of options.”

He’s also involved from the get-go in Brookfield’s acquisition talks, as his team helps determine whether the potential rents from an asset are worth the purchase price. On dispositions too, his team is key.

“No one understands the attributes of the buildings like we do,” he said.

I

n March, money manager Baron Funds renewed its lease at the GM Building and expanded its presence by 25,000 square feet. Baron agreed to pay rents of around $200 per square foot for its space near the top of the country’s most valuable office tower. As with all of Boston Properties’ renewal and expansion deals, Levin and his three-member leasing team did the 80,000-square-foot deal in-house. “[By contrast,] if we need to go out to the market to bring in new tenants, we typically use outside brokers,” said Levin, who’s been with the firm for 18 years. “I can pay a commission and get the talent level of a Peter Turchin or a David Green [of Cushman & Wakefield].”

If hired as landlord representatives, brokers take Boston Properties charge of the day-to-day negotiations with tenants, but Square Feet in NYC: the in-house leasing director is constantly involved and 9 million makes the final call, sources said.

“We see trends in the market sometimes a little bit earlier than owners do,” said CBRE’s Turchin, pointing to the fact that brokerages have bigger teams and a richer database to tap into. In some cases, a broker can also get to a potential tenant earlier in the process.

A landlord may also opt to go outside to a broker, Turchin added, because an in-house leasing director has so many different responsibilities, from budgeting to capital improvements to asset management. A broker, on the other hand, is “just doing deals, all the time.”

The 43-year-old Levin oversees about 9 million square feet of space in Boston Properties’ New York portfolio, and his team typically does between half a million and 1 million square feet of lease deals a year. In addition to the GM Building, the REIT’s portfolio includes trophy properties like 510 Madison Avenue, a speculative office tower built by Harry Macklowe that Boston Properties won out from under the developer, and 7 Times Square. The buildings tend to cater to blue-chip financial and law firms, which Levin termed “high-margin tenants.”

He’s also working on leasing up the company’s 1 million-square-foot spec office tower at 250 West 55th Street. Activity at the building got off to a sluggish start, but the tower is now over 60 percent leased with tenants such as Soros Fund Management, the investment firm of billionaire George Soros. Boston Properties is also reportedly in talks with Qatari media

Andrew Levin

giant Al Jazeera for 50,000 square feet at the building, which Levin declined to comment on.

In addition, the REIT is looking to buy properties in neighborhoods such as Midtown South, which would allow it to cater to the wave of technology and media tenants making its presence felt in the city, Levin said.

“We always want to be near markets where occupancy is growing,” he said.

Levin graduated from Boston University and started his career at the Edward S. Gordon Company, one of the first firms to take a Wall Street–style approach to commercial real estate.

The company was acquired by Insignia Financial Group, which was, in turn, bought by CBRE. “We’d give brokers spreadsheets comparing Lease A to Lease B to Lease C, which they’d then share with their clients,” said Levin, who worked in the firm’s consulting division. “It got boring very quickly,” he said, noting that he progressed to doing analyses of the more complicated deals.

Levin went on to Columbia Business School, where he concentrated on real estate, fancying a career in development. While a student, he interned with the refinancing division of the Related Companies, and then accepted a project management job with Boston Properties shortly before graduating. With almost two decades under his belt at the firm, Levin said the challenging nature of the work makes him disinclined to consider alternatives.

“It’s hard to pick up your head and look at other things when you’re having fun,” he said.

B

ow oversees about 13 million square feet for the Durst Organization. A graduate of Columbia College and Columbia University’s Business School, where he specialized in real estate finance, he joined the firm in 1992, after nearly five years as a leasing broker at Cushman.

In 2011, Condé Nast agreed to take about 1.2 million square feet at Durst’s One World Trade Center, the 2.6 million-square-foot tower at the center of the Ground Zero reconstruction. Condé Nast will move from 4 Times Square, which is also owned by Durst.

And in December, the U.S. General Services Administration agreed to take 273,000 square feet at One World Trade.

The Durst Organization Since then, there’s been less to write home about, Square Feet in NYC: as the owners have yet to secure another major 13 million tenant.

But Bow has shown that he can get creative with his portfolio. In 2011, he had to deal with the exodus of pharmaceutical firm Pfizer at 205 East 42nd Street. He was involved in converting the 530,000-square-foot building’s floors into separate condos. He then pitched those spaces to nonprofits, which could tap into tax benefits if they purchased them. He subsequently struck deals with the City University of New York for 161,000 square feet and the United Way for about 50,000 square feet. And in August, he crafted a lucrative signage deal with retailer H&M at 4 Times Square, where the Swedish retailer has 42,500 square feet of retail space under construction. Durst will put up signs measuring 70 feet by 70 feet atop the 48-story building for H&M, in a deal which is expected to rake in millions of dollars in annual rent for the landlord. TRD

Thomas Bow

C O R R E C T I O N S A N D C L A R I F I C AT I O N S In the March magazine story “7 over 70,” TRD inaccurately stated the number or air rights Robert Shapiro has been involved in selling, the time period those sales took place and the developers he worked with in that period. He has been involved in the sale of more than 1.5 million square feet of air rights in the last decade, and throughout his career has worked for major players like Harry Macklowe, Host Marriott and the Zeckendorfs.

120 May 2014 www.TheRealDeal.com

In the March feature “Development Updates,” TRD listed the incorrect agent for Stella Tower at 425 West 50th Street. The agent is Douglas Elliman.

www.TheRealDeal.com www.TheRealDeal.com January 2012 00

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Residential market from page 26 showing each client the same unit, in some cases.

Still, Kleier said buyers are still discerning. She cited a family that passed on a home because the dining room was “two feet too short.” While she said anyone ready to buy should be prepared to pay above the asking price, she also noted that they should not act in haste.

“You know who in your mind will act quickly and whom

the home is right for,” said Kleier, a former social worker, who also noted that “hand-holding is a very important part of our job.”

Meanwhile, as buyers feel burned, sellers are, of course, feeling empowered.

“Sellers read about fanciful apartments selling for huge amounts and they push the price to a level that doesn’t make sense,” Elliman’s Steinberg said. “It should not be

based in fantasy.”

Regardless of the unit’s condition, sellers assume that buyers will “trample all over themselves” to bid on it, said Miles Chapin, a broker at Warburg.

“The market speaks loudly,” Chapin said, “and for an overpriced listing, or one that isn’t in some fashion distinguished from its comparables, sometimes the silence is deafening.” TRD

Boutique firms from page 41 headed by Adam Modlin, is listing a $32 million penthouse at 383 West Broadway in Soho and a $24 million penthouse at 76 Crosby Street.

Meanwhile, Peter McCuen & Associates debuted on this year’s ranking with $79.5 million in listings. (TRD included firms with two or more agents this year, rather than five. And, unlike in previous years when TRD used company websites for agent counts, this year the magazine pulled those figures from OLR.) Among McCuen’s most eye-grabbing listings is an $18.5 million townhouse at 21 East 94th Street, which is owned by Alexandra Piol, managing director at 4C Ventures Management, according to public records.

Meanwhile, Fox Residential, a well-established Madison Avenue-based boutique firm headed by Barbara Fox, saw a drop in its exclusive listings. The company had $43.9 million, compared with $64.4 million last year.

Despite a drop in listings, Fox said the company is in good shape and has several listings in contract. Fox also recently closed a $30 million deal at One57, the trophy residential tower at 157 West 57th Street, she said.

Kleier Residential, the boutique residential firm featured on HGTV’s “Selling New York,” dropped off this year’s ranking, registering roughly $7 million in exclusive listings as of March 30, OLR data shows. However, Michele Kleier, president of the firm, told TRD that she had several clients holding off

Dolly Lenz has the listing for Tommy Hilfiger’s $80 million Plaza apartment.

until the weather improved before listing their apartments, which have terraces. The company has plans to list a $25 million apartment by the end of April, she said. By press time, its listing tally was up to $11.6 million.

“Terraces don’t look good after the freezing cold snow,” Kleier explained. “Nothing bloomed this winter.”

Meanwhile, several other firms that didn’t qualify under

TRD’s guidelines still had impressive showings.

For example, River 2 River Realty, a tiny firm headed by Dan Neiditch that has dominated resales at the Atelier condo building at 635 West 42nd Street. The brokerage had $234 million worth of Manhattan listings, nearly all of them at the Atelier. Neiditch is also a resident of the building as well as being the condo’s board president.

In addition, Trump International Realty had $106 million in listings.

The firm, which opened its doors in 2012 with close to 20 agents in four Manhattan offices, has most of its listings in Trump buildings, but did have some others, like a pad asking $7.75 million at 15 Union Square West.

And despite racking up the most listings (and though OLR is seen as a reliable measure of exclusive listings by the industry), Lenz disputed her firm’s figures, saying that she had 67 active listings worth $566 million.

“The firm ... never inputs any data into OLR,” she wrote to TRD in an email. “It is therefore not surprising that OLR is under reporting the true figure.” TRD

5Pointz from page 76 the aerosol artist behind the Phun Factory, an organization that gave talented-but-publicly maligned graffiti artists a legal space to express themselves.

Sympathetic to the arts, the Wolkoffs gave Delillo and his ragtag painters permission to cover 5Pointz with their aerosol art. As the project grew, 5Pointz became a prestigious space where acclaimed street artists were invited to show their work, with Jonathan Cohen, known in the graffiti world as Meres One, as curator.

“Graffiti is a wonderful self-expression,” David said. “We like to think of ourselves, as developers, as creative types in some form or fashion. I find that street art can be very poignant. I love the colors, the movement and the depth of what these artists can do.”

But despite his longtime relationship with the Wolkoffs, Meres One was one of the most vocal opponents of the demolition. However, the developers claim that they were always upfront with the artists about their long-term intention to demolish and replace 5Pointz. They had, in fact, issued only month-to-month leases for over a decade for that very reason, the Wolkoffs told TRD. “I believe I was on the forefront of showing that aerosol art could be done in a proper manner,” Jerry said. “For 20 years I allowed more than 100,000 paintings to exist on my building, but now that I want to build something great for the neighborhood, Meres and the others acted like the building was theirs, even though they knew all along that this was temporary.”

While some opponents characterize the Wolkoffs as ruthless capitalists willing to destroy a much-loved cultural 122 May 2014 www.TheRealDeal.com

institution to cash in on luxury development, the pair rebutted that notion.

“There is nothing to be ashamed or upset about. We have had this planned for the last 12 years,” David said. “It just took a long time for Long Island City to have enough momentum to support a project like this.”

Beyond 5Pointz And the momentum in Long Island City is, of course, palpable.

Approximately 9,000 residential units, including those at the 5Pointz site, are planned for the neighborhood, according to estimates from the brokerage MNS. According to the Wolkoffs, the new 5Pointz will function more as “community” than a traditional residential building, with 50,000 square feet of retail, 12,000 square feet of artist studios, graffiti space on the concrete walls, tennis and basketball courts, a swimming pool, a gym, media and party rooms, a 250-space parking garage and a new public park.

While the project is still in the planning stages, the Wolkoffs said that the vast majority of the units will be studios and one bedrooms, with some two and three bedroom units. Apartments at the project, which is scheduled for completion in 2016, will range in size from 500 to 1,200 square feet. Rents have not yet been set.

And area brokers, even those who are graffiti art collectors, are on board.

“The old 5Pointz was nice while it lasted, but things progress,” said Eric Benaim, CEO of the Long Island Citybased residential brokerage Modern Spaces and a street art

collector. (Benaim’s collection includes works by the British graffiti artist Banksy and other well-known names like KAWS, Nick Walker, FAILE and Mr. Brainwash.)

“I’m excited for the art studios that will be coming at the base of the building. Plus there is a good portion of retail, which we need more of in Court Square,” he said.

As evidenced by the amount of time they spent waiting to redevelop 5Pointz, sources say the Wolkoffs are actually conservative developers, rarely taking on debt and seldom partnering with other builders or outside property managers.

And 5Pointz isn’t their only ambitious project right now.

In Brentwood, Long Island, on the grounds of the a former hospital, they are building the Heartland Town Square, a $4 billion mega “village”. The project will feature 9,000 rental apartments, 3 million square feet of Class A office space, a 1-million-square-foot retail center, a hotel and convention center, restaurants, a movie theater, an aquarium and public parks.

“Jerry and David’s vision is very exciting,” said Andrew Barrocas, CEO of the brokerage MNS and a longtime friend of the Wolkoff family. “They are building projects that are totally unique to the marketplace.”

For his part, Jerry said he has always believed that the outer boroughs were the place to carry out his vision.

“Every year for the last 20 years, we’ve built between 200,000 and 300,000 square feet of commercial and industrial space on Long Island and in the boroughs,” he said.

“Manhattan has always seemed too risky. I like to build from scratch, which is more complicated in the city.” TRD www.TheRealDeal.com January 2012 00

Ackman

from page 30

where a big opportunity exists, is one to pursue,” Ashner said. “He loves optionality.”

Neither Ackman nor his representatives responded to requests for comment on this story.

Small investment, big opportunity While his investments involve a range of industries, Ackman, 47, whose family founded the Ackman-Ziff Real Estate Group, is often keen on real estate.

In some cases, what first appeared to be failures have reversed course for him. During the worst of the recession, Ackman invested $60 million in General Growth Properties, which owns five malls in New York and New Jersey among other properties, then pushed for the company to file for bankruptcy in 2009. The company later reorganized, with Ackman at the helm, and spun off some assets under the Howard Hughes Corp., a move which helped it emerge from bankruptcy a year later.

Ultimately, Ackman could not seize the entire company; he was unable to convince General Growth to sell him all of its shares. But his exit was profitable; he liquidated his holdings in recent months for $1.6 billion. And he’s been quoted as saying General Growth was one of the best investments he’s made.

In addition, he recently upped his investment in Howard Hughes to 5.5 million shares to control about 13 percent of the company’s common stock. He also serves as chairman of the board, and since he arrived, the Dallas-based company has been peppering its board with top New York real estate executives. For example, CBRE Group broker Mary Ann Tighe joined in 2011.

Howard Hughes is actively expanding in the city. It recently started a major redevelopment of South Street Seaport. The company also plans to buy the adjacent 80 South Street, where the city recently approved a 300,000-square-foot mixed-use tower.

By some measures, Ackman’s interest in Howard Hughes might seem misplaced. Nationally, the commercial market is taking far longer to recover than the housing market, and analysts say the company’s portfolio,

which is heavy on large shopping centers, could hold risks.

Then again, having more control of the company gives Ackman the keys to a brand name and to a seasoned management team, Nyman said. “It’s not that easy to go and buy a huge stake in a Westfield or Simon Property Group,” he said, referring to the well-known retail developers. “He has very strategically positioned himself in the market space to become a player.”

In the past, Ackman has moved to tap the potential of the far-flung real estate holdings of other major Pershing investments, including fast food chains McDonald’s and Wendy’s. About 10 years ago, for instance, he pressed McDonald’s into selling about 1,500 restaurants to unlock shareholder value, after he took a major stake in the chain.

Counting on Congress In the first three months of the year, Ackman also made another key real estate investment, boosting his ownership stake in Fannie Mae and Freddie Mac at a time when their existence is threatened. The government-sponsored companies are responsible for backing 60 percent of the country’s home loans, including billions of dollars worth of loans in New York.

In a series of purchases, Ackman increased his stake in Fannie Mae, formally the Federal National Mortgage Association, to more than 11 percent this spring. Ackman upped his slice of Freddie Mac, or the Federal Home Loan Mortgage Corp., by a similar percentage.

All told, last month, Pershing’s investment in the two were worth about $500 million.

The federal government owns about 80 percent of both Fannie and Freddie, which have both been under government control since they were bailed out in 2008.

While Ackman’s investment is tiny relative to Pershing’s $11 billion in assets under management, it’s also laced with risk, analysts told The Real Deal.

For starters, Ackman owns common stock, whose holders are usually the last to get paid when a company goes under.

And going under may be a real concern. At press time, the Senate was slated to vote on a bi-partisan bill that would essentially dissolve Fannie and Freddie and replace them with a single entity.

That’s despite the fact that Fannie and Freddie have turned around their fortunes in recent years and have been posting huge profits — a record $84 billion and $48.7 billion in 2013, respectively.

But their bailout agreements require them to send all their profits to the U.S. Treasury, an arrangement that shareholders have challenged in federal court. Together, they have paid about $203 billion to the government, exceeding their bailouts by more than $10 billion.

Analysts say Ackman seems convinced that Congress will ultimately realize Fannie and Freddie will continue to be cash cows as long as the housing market rebounds, and thus won’t do away with them.

And even if they dissolve them, Ackman could be in a strong position to roll at least part of his investment into their replacement.

That may be why Ackman said at a recent investment conference that his $500 million investment could be worth more than 10 times that much in several years, according to news reports.

The ace up his sleeve is courtesy of ongoing shareholder lawsuits. Milwaukee-based hedge fund Perry Capital and the Miami-based Fairholme Funds are suing the government to keep a share of the profits and not have them diverted to the Treasury Department. At the conference, Ackman reportedly predicted the Supreme Court would side with the plaintiffs if the suits go that far.

Even if those suits just get settled, Ackman stands to recoup some of his investment, said Lawrence White, a professor at New York University’s Stern School of Business who also co-authored “Guaranteed to Fail,” a 2011 book critical of Fannie and Freddie.

“The shareholders are there, and I think they’ve got a pretty good story to tell, about why they should be entitled to a share of the profits,” White said. “The shareholders will end up with something.” TRD

Mid-sized firms from page 40 Shifting strategies

A new guard

MNS, formed in 2005 and headed by Andrew Barrocas, saw the biggest drop in its Manhattan exclusives yearover-year. MNS experienced a 68 percent decline in the dollar volume of its Manhattan listings, according to TRD’s research. It had just six Manhattan exclusives accounting for $8.7 million, down from 20 listings accounting for $27.4 million last year. It ranked No. 12 on TRD’s midsized ranking as a result.

The company also lost Manhattan agents. It now has 51 Manhattan brokers, down from 62 last year, TRD found.

Barrocas attributed the company’s loss of Manhattan market share to a general shift in the company’s strategy, saying that in recent months its focus had been directed squarely on new development in the boroughs.

“We’re more focused on development as a whole [than before],” Barrocas said. “We’re doing a lot in the boroughs.”

The company, for example, is selling Williamsburg Townhomes, a 12-townhouse project in Williamsburg, where prices start at $2.25 million. It also represents several Brooklyn rental buildings, including 456 Grand Street in East Williamsburg and 110 Green Street in Greenpoint.

Meanwhile, Fenwick Keats also saw its total listing dollar volume drop, to $38.2 million from $44.2 million.

However, by the end of last month, the firm was up to about $56 million in listings.

A new string of Manhattan-based firms has made its mark this year, earning a place in the mid-sized ranking for the first time.

Platinum Properties, a company that barely made TRD’s boutique ranking last year, took the No. 5 mid-sized spot with a major uptick in the dollar volume of listings.

Platinum, which was founded in 2005, had $51.5 million worth of listings, up from just $13.4 million last year. That’s primarily thanks to a couple of highpriced properties the firm has snagged in recent months, including a $13 million pad at 40 Broad Street owned by Alex Birkenstock, heir to the eponymous sandal fortune, and a $13.5 million penthouse at 111 Jane Street, owned

by Moise Emquies, the high-end T-shirt titan and founder of the fashion brand Splendid. Both listings came on the market in March.

Daniel Hedaya, president of Platinum, said the firm has been trying to develop a reputation in the luxury market and has expanded beyond the Financial District, where it was first established. As such, a large number of the company’s listings are now located in other Manhattan neighborhoods, including Greenwich Village and Harlem.

“We’ve made a lot of headway for ourselves in sales,” Hedaya said. “I think a lot of people know us as being a Financial District brokerage, but if you look at our

124 May 2014 www.TheRealDeal.com

exclusive listings, they’re really scattered throughout Manhattan. We’re seeing a tremendous shift in our activity.”

Other firms debuting on this year’s mid-sized ranking include a couple of companies established in the wake of the recession and whose business models differ substantially from other mid-sized firms. Both KIAN Realty and the Spire Group were formed three years ago and have seen a vast expansion of their ranks in the last year.

KIAN, founded by Charles Doolan and Jae Muk Chung in 2011, has a 100 percent commission model — similar to the model employed by Rutenberg Realty but with a slightly different fee structure. And with just one office, at 450 Seventh Avenue, most of its 172 licensed agents work virtually. KIAN has $22.4 million worth of exclusive listings.

“We started with just six agents in 2011, and now we have 172,” Doolan said of the firm’s rapid growth.

Spire Group, another 100 percent-commission firm, was formed by Kurland Realty’s founder Kevin Kurland.

It, too, has seen explosive growth since it launched in 2011: the company now has 161 agents. However, as of March 30 it had just $9.7 million in listings on its books, but by the end of last month that jumped to roughly $14 million. TRD www.TheRealDeal.com January 2012 00

Commercial market

from page 18

The Chrysler Building

plan is to lease the top three to five floors to a single tenant, Leon said.

The response from brokers and tenants has been strong there, as well, and he’s been hearing from companies in fields such as financial services and social media.

In addition, about 400,000 square feet was added to the market within the 511,700-square-foot 225 Park Avenue South at 18th Street, owned by Orda Management, as the Port Authority of New York and New Jersey prepared to relocate to 4 World Trade Center in Lower Manhattan.

The competitive market in Midtown South continued to push asking rents up. Last month, asking rents hit $56.15 per foot, up 62 cents per foot, from $55.53 per foot in March. However the flurry of newly listed large space drove up the availability rate to 9.2 percent, from 8.8 percent in

1 New York Plaza

250 Vesey Street

March, the Colliers figures showed.

119 West 24th Street

The availability rate fell sharply in Lower Manhattan last month, as large blocks of space were leased in several buildings, including 1 New York Plaza and 250 Vesey Street. But smaller deals as usual dominated leasing activity, and also helped push down the availability rate.

The social media analytics provider SumAll inked one of those modest-sized leases at 123 William Street, a 569,100-square-foot office tower that East End Capital Partners and GreenOak Real Estate purchased in October for $134 million. The social media company is growing, and has secured $14 million in funding, a company spokesperson said.

SumAll, represented by CBRE Group’s David Young, is more than tripling in size, moving to 12,800 square feet at 123 William, which is located between John and Fulton streets, from 3,000 square feet in 247 Centre Street in Little Italy, the spokesperson said. The rent was not disclosed, but asking rents in the tower range from $36 per foot on the lower floors to $50 per foot on the upper floors.

The availability rate in Lower Manhattan fell sharply, dropping by 0.6 points to 13.8 percent in April, down from 14.4 percent in March, the Colliers data revealed. In addition, following the pattern in Manhattan’s other markets, the average asking rent rose sharply. It was up by 74 cents per foot in April to $50.99 per foot.

“Downtown is seeing absorption and prices rising,” Colliers’ Harbert said. TRD

defaulting on the loan in 2004, according to an affidavit.

Premier Capital, which acquired the rights to collect on the loan in 2012, sought the full amount, plus 9 percent annual interest dating back to November 2004.

Premier filed a discontinuance with the court late last month, according to Hochfelder’s attorney A. Mitchell Greene, who claimed that the loan was paid off in 2004.

An attorney for Premier declined to comment.

Prior to his fall from grace, Hochfelder was a marquee name in real estate. His firm, Max Capital Management, arrived on the scene in 1996, snatching up Manhattan trophy properties left and right, including the Helmsley Building, 237 Park Avenue and 450 West 33rd Street. Then, in 2002, he bought out his partner, N. Richard Kalikow — an heir to the Kalikow real estate fortune — for a whopping $35 million.

Two years later, Hochfelder found himself in the Manhattan District Attorney’s office, where he admitted to forging signatures on several loan documents to raise the money

to buy out Kalikow. In an interview with TRD several years ago, Hochfelder’s then-lawyer, Marc Agnifilo, said buying out Kalikow left Hochfelder financially stretched — and he turned to illegal means to stay afloat.

In 2008, the short cuts caught up with Hochfelder. He was hit with a 58-charge indictment that accused him of stealing more than $18 million through several fraudulent loans from banks as well as friends and family.

After initially claiming innocence, he pleaded guilty in September 2010 to defrauding lenders. Earlier that year, he also confessed to stealing $2.5 million from investors for the purchase of the Sagamore Hotel on Lake George in upstate New York, and the Peaks Resort and Spa in Telluride, Colorado. He admitted that he used the capital to, among other things, pay for lavish spending sprees.

Hochfelder’s former partner, Kalikow, now works for Manchester Real Estate and Construction on Madison Avenue.

Sources said he has not talked to Hochfelder in years. TRD

the real estate industry. The deal calls for an average salary increase of 2.7 percent a year.

The tower’s resident manager, meanwhile, will draw a heftier annual salary of $150,000 during the building’s first year, with a 3 percent annual increase, according to the filing. But the biggest perk of that job might be the apartment included with the position. The manager will get the keys to a 1,985-square-foot, two-bedroom, two-bathroom southwest-facing unit on the 34th-floor.

The resident manager will also pocket a fee of $600 for reviewing the documents when an owner sells or leases a unit and get cash for any services provided in the supervision

of renovations.

It’s unclear whether the resident manager’s position has been filled, or whether the building is still accepting applications.

Downtown

Hochfelder from page 44 Hadar from Stonehenge Partners and Invesco Real Estate for $185 million last year.

Nearly four years removed from his conviction on fraud charges, Hochfelder continues to face remnants of his past.

For one, he sought to pay off all remaining debts. According to a September 2010 court summary of victim support and loan payments, Hochfelder paid back 76 percent of loans owed prior to 2008. Of the $21.3 million in principal owed at the time, he paid back $16.5 million before 2010, the summary shows.

In 2012, he paid the remaining $122,000 on a $1.3 million loan tied to a 2003 lawsuit filed by his in-laws that alleged that Hochfelder used a co-op at 1025 Fifth Avenue as collateral to secure a loan from Arbor Commercial Mortgage.

In February, Massachusetts-based loan servicer Premier Capital LLC filed a motion for summary judgment against Hochfelder over a $2.47 million loan initially obtained in 2003 from Bank of America. Hochfelder confessed to

One57 from page 48 small for a building of this size, Beare said that number makes sense for One57, which is likely to have many owners who don’t spend much time there. “It’s the type of building that is attractive to people that are not living there fulltime,” she said.

According to a recent AG filing, handymen will make between $942 and $970 a week, while the concierges and porters will make between $854 and $879. Those weekly salaries might be on par with a dinner out for some of the building’s owners. However, the rates are likely to go up, because a deal was struck last month between the union and the Realty Advisory Board, which represents employees in 126 May 2014 www.TheRealDeal.com

Pushing up prices For those who thought One57’s prices couldn’t go any higher, think again. In an October amendment, Extell revealed that it raised the listing prices on 11 units located on floors 43 through 56. Unit 43C, a four-bedroom, four-and-a-halfbathroom, jumped to $19 million from $17 million, while unit 56C was upped to $26 million from $23 million. TRD www.TheRealDeal.com January 2012 00

Bob Knakal & his Team

WTC

from page 61

a merchandising plan or site map. That map includes tenants that have actually locked in space, as well as “aspirational” tenants — tenants the owner wants to go after. Within the industry, using these types of maps is controversial because it can leave retailers and their brokers under the impression that a certain tenant is on board, when in fact it might not be.

That merchandising plan is part of the quiet dance between the mall operator and scores of tenants, each jockeying for the best financial terms and the best retail neighbors, or co-tenancy.

“They have to put names on [the merchandising plan] to target, but the plan changes a thousand times,” one broker said.

But some sources said Westfield has not been completely frank when dealing with retail brokers since it began the leasing process. However, they noted, that other large landlords are no different.

Westfield “tells you the status of all the retailers you value,” said one tenant-rep broker. “You can choose to believe them or not.”

In addition, Westfield wields enormous power because of its ownership of malls all over the world. Multiple sources said the firm has tried to put pressure on tenants to take space in the World Trade Center by making contingencies for deals in another Westfield property.

However, sources said Westfield was not unique in that regard, either. In fact, brokers said the same happens sometimes with powerful New York landlords.

Luxury wars Despite all of the tenants that have signed on, brokers say that on the whole, Westfield has lost the luxury battle with Brookfield

Place, which landed a slightly wider range of high-end tenants, including Burberry, Salvatore Ferragamo, Hermès and Diane von Furstenberg.

Yet late last month, a retail source told TRD that Westfield may have high-end designer Prada lined up, so no one is counting Westfield out.

The project’s distinct architecture alone is expected to draw droves of tourists into the building, even though the columns that are part of that design are turning off some retailers. A few have pointed out the irony that above ground, the officeleasing brokers are selling the World Trade Center towers as engineering marvels that are nearly column-free.

Several tenant brokers said their clients have balked at the columns, but Westfield has attempted to counter that by showing tenants potential store designs that are not impeded by the columns and that allow them to effectively brand their spaces.

The Calatrava columns aren’t the only issue. Some retailers are simply uncomfortable with being in an underground mall, and are taking space in Brookfield Place or on Broadway, both locations where they can be above ground. For example, Zara recently leased a three-level space at 222 Broadway, and the Gap took space at 170 Broadway, according to news reports.

Sources say that the project is also dealing with the challenge of finding retailers willing to spend money on expensive buildouts. That’s because Westfield wants flagship-quality stores at the project. Though it’s unclear how much Westfield is chipping in with construction costs as incentives for those build-outs, building in the World Trade Center is two or three times more expensive than a typical store construction, insiders said.

“They are putting together a great co-tenancy,” said one broker who is negotiating with Westfield on behalf of tenants.

“I just think it’s taken a little longer and been a rougher road than they expected. But I think it will be world-class.”

JLL’s Gibson echoed that point.

“I just don’t think everybody wants to be in a transit hub,” said Gibson, who would not comment on specific deals.

“But I think it will be successful. The commuter traffic is off the charts.” TRD

Rutenberg’s top guns to head up William Raveis push in NYC Purcell, Braddock to spearhead Northeast powerhouse’s first foray into the city

By Hiten Samtani ill Raveis, the man behind Northeast brokerage giant William Raveis, hosted 35 of New York City’s top brokers last month at the Four Seasons restaurant.

Raveis announced that on June 1, his firm would open its 100th office — in New York City. Raveis also revealed that Rutenberg Realty principals Paul Purcell and Kathy Braddock would head up the new venture.

The firm, named William Raveis New York City, has

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William Raveis

already taken a 4,000-square-foot office at East 56th Street.

Purcell and Braddock are no strangers to building a real estate company. The pair turned Rutenberg into a successful firm, and before that were at the helm of Douglas Elliman.

“I think Paul and I do consider ourselves serial real estate entrepreneurs,” Braddock said.

Raveis started his firm in 1974 in Fairfield, Conn. It’s since blossomed into the largest family-owned brokerage in the Northeast, with more than 3,500 agents. In New York, the company plans to open up to four offices with around 200 agents, Raveis said, stressing that he’s actively looking to recruit entrepreneurs.

Braddock said that Raveis would maintain full ownership of the New York venture.

Raveis said the firm would have a “real estate concierge service” which will act as a call center to pass leads to individual agents, and will also share real-time market data.

“The business models in New York are a little stale,” Raveis said. “We’re going to shake them up a little bit.”

Braddock confirmed that the move to William Raveis marked the end of their involvement in Rutenberg.

William Raveis New York City has already received $70 million worth of business from the firm’s Northeast branches, and Raveis said he expects that to jump to $200 million in a year. TRD www.TheRealDeal.com January 2012 00

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CALENDAR

The Real Estate Board of New York presents The Most Ingenious Deal of the Year Awards honoring commercial brokers at its 70th annual cocktail party.

5:30 p.m. to 7:30 p.m. 101 Club, 101 Park Avenue. Fee: $60. Information and registration: www.rebny.com.

6

The Museum of the City of New York in conjunction with the American Institute of Architects’ New York chapter presents Innovators: Building Design and Construction. Jill Lerner, president of the AIA New York chapter, will moderate a panel comprised of architect Corie Sharples of SHoP Architecture, architect Marianne Kwok of KPF, engineer Valentine Lehr of Lehr Consultants International and Guy Nordenson, principal of Guy Nordenson and Associates. 6:30 p.m. to 8:30 p.m. Museum of the City of New York, 1220 Fifth Avenue. Fee: Free for AIA and Museum members, $16 for the general public, $12 for students and seniors. Information and registration: cfa.aiany.org.

13

The Appraisal Institute presents its chapter luncheon meeting, Reinventing a Landmark. Kenneth Horn, president of Alchemy Properties, is the guest speaker. Registration and networking, 11:30 a.m. to 12 p.m.; luncheon and program, 12 p.m. to 2 p.m. Club 101, 101 Park Avenue. Fee: $120. Information and registration: www.aimetrony.com.

13

The Institute of Real Estate Management hosts an evening at Yankee stadium for the Mets vs. Yankees game. Tickets include an all-you-can-eat picnic.

5:30 p.m. to 10 p.m. Fee: $110. Information and registration: www.iremnyc.org.

13

The Council of New York Cooperatives and Condominiums, the Federation of New York Housing Cooperatives and Condominiums and the Association of Riverdale Cooperatives presents Introduction to Co-op Board Responsibilities: An Intensive Seminar for New Directors.

Featured speakers include attorney Marc Luxemburg and property manager Gregory Carlson. Two-session seminar, second session May 20. 6 p.m. to 9:30 p.m. Location TBD. Fee: $125 for members, $200 for non-members. Information and registration: www.cnyc.com.

13–14

The New York State Association for Affordable Housing presents its 15th annual New York State Affordable Housing Conference. Agenda includes a pre-conference education forum on May 13, and a general session May 14. Featured panelists include Vicki Been, commissioner of the NYC Department of Housing Preservation and Development, Alicia Glen, deputy mayor for Housing & Economic Development and Shola Olatoye, chair of the New York City Housing Authority. 8 a.m. to 4 p.m. on May 13 followed by a reception at 5:30 p.m.; 8 a.m. to 5 p.m. on May 14, followed by a 7 p.m. cocktail reception. Marriott Marquis Times Square, 1535 Broadway.

Fee: $625 for members, $799 for non-members. Other registration options available. Registration and information: www.nysafah.org.

130 May 2014 www.TheRealDeal.com

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7

The American Institute of Architecture presents its 2014 Design Awards Panel – Honor Awards, which awards 13 winning projects. Principals and project managers will present their work with a panel discussion to follow. 6 p.m. to 8 p.m. The Center for Architecture, 536 LaGuardia Place. Fee: Free for members, $10 for non-members. Information and registration: cfa.aiany.org.

5 6 7 8 9 10

15

The Building Owners’ and Managers’ Association of Long Island, and the Institute of Real Estate Management’s New York chapter, presents Casino Night and Cocktail Party. 6 p.m. to 10 p.m. 68 S. Service Road, Melville, NY. Fee: Free for BOMA members, $85 for IREM members, $100 for non-members. Sponsorship opportunities available. Information and registration: www.bomali.org.

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16–18

CORE studio Thornton Tomasetti presents its Architecture, Engineering, and Construction Technology Symposium and Hackathon. Featured speakers include Deepak Aatresh, founder of Aditazz, Shane Burger, global director of design technology at Woods Bagot, and Jordan Brandt, technology futurist at Autodesk.

Topics will include advances in data-intensive computational design, analysis, construction and fabrication, as well as how web-based applications can enhance these processes.

The symposium will be followed by a weekend-long “hackathon” for generating new ideas for the AEC community. 9 a.m. on May 16 to 4 p.m. on May 18. The Cooper Union, 41 Cooper Square. Fee: $150.

Information and registration: core.thorntontomasetti.com.

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19

The Center for Active Design presents Celebrate Active Design, an awards cocktail event to recognize innovative design that promotes health. Awards will honor the accomplishments of individuals and firms that have demonstrated innovative ways to transform built environments into active spaces. 7 p.m. to 9 p.m. The Lounge, 173 Lafayette Street. Fee: $75. Information and registration: www.centerforactivedesign.org.

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The Real Estate Board of New York presents its 11th annual Commercial Management Leadership Breakfast. The event will honor outstanding leaders in the field of commercial property management.

Presentations include the Edward A. Riguardi Commercial Executive of the Year Award, the John M. Griffin Community Service Award, the On-Site Manager of the Year Award and the Portfolio Manager of the Year Award. 8:30 a.m. to 10 a.m. The Hilton New York Grand Ballroom, 1335 Avenue of the Americas. Fee: $100. Information and Registration: www.rebny.com.

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Web hits: The month in review (Read full stories online)

Shigeru Ban’s Cast Iron House debuts after Pritzker win

Ronald Solarz, left, and Eric Anton

Longtime investment sales team Anton, Solarz split Eric Anton and Ronald Solarz brought their 14-year run as partners in New York City real estate brokering to a close last month.

The two worked together for more than a decade in investment sales at Eastern Consolidated. In 2011, they joined Brookfield Financial, a unit of Toronto-based real estate giant Brookfield Asset Management.

In a letter to colleagues, also sent to The Real Deal, Solarz said he is heading back to Eastern in his former role as executive managing director and principal. Anton is staying on with Brookfield as managing partner. Solarz told TRD the two remain friends and “left on the best of terms.”

The pair completed multiple large deals together, including a $125 million land transfer from Fordham University in 2011 and the $122 million sale of the Verizon tower on Pearl Street.

Top deals of the month Living room at 1 Central Park South

A long-anticipated Tribeca condo project, with interiors designed by Shigeru Ban, launched sales one month after the acclaimed Japanese architect was awarded the prestigious Pritzker Prize.

The Cast Iron House, at 67 Franklin Street, comprises 11 duplex residences and two penthouses.

Corcoran Sunshine Marketing Group is heading up sales. Prices range from $5 million to $15 million.

Developer Knightsbridge Properties converted the New York City landmark, built in 1882. The restoration of the property’s façade involved recasting about 4,000 pieces of the ornamental siding.

The firm is adding two penthouse units to the structure.

The addition will be suspended via a steel cantilevered Vierendeel truss, making it appear from street level as though it’s floating above the building. The property was formerly home to commercial tenants and a branch of Nyack College before the leases expired in 2008.

The Cast Iron House at 67 Franklin Street

Nicholas Schorsch

Michael Happel

New York REIT goes public in a first for the markets American Realty Capital’s New York REIT listed shares on the New York Stock Exchange last month in a first for a real estate firm specializing solely in New York City properties.

New York REIT, led by American Realty CEO Nicholas Schorsch and President Michael Happel, was founded in 2010. It exploded into one of the city’s most aggressive players, acquiring about $1.8 billion worth of real estate in 2013, mostly Manhattan core office and retail properties.

Happel set a goal of spending another $1 billion over the next year, in the wake of acquiring an office building at 1440 Broadway in October for $529 million.

Empire State Realty Trust and SL Green, both publicly traded REITs, have properties outside of New York City.

Most popular stories • How a leaky roof jump-started Jeff Sutton’s real estate career

Jared Kushner

• Kushner to convert Brooklyn Law buildings to mansions • Ryan Serhant’s WeChat deal at the Baccarat? Not really his • Residential prices shoot through roof • City’s most active developers? Familiar names, some surprises

Adelaida DelGado Palm Bathroom at 1 Central Park South

Bedroom at 1 Central Park South

• Fannie Mae holds quiet equity stake in $1B portfolio: sources • How brokers are clicking with the Technorati • New York investor snaps up Mobil building for over $900M • Town’s former West Village sales director jumps to Trump • Hare Krishnas list Brooklyn headquarters for $60M

Agent

Firm

Price

Address

Julia Cahill Adelaida DelGado Palm

Corcoran Group

$34,500,000

1 Central Park South

Susan Barkin

Barkin & Associates

$24,000,000

15 Central Park West

Howard Margolis Pat Slochower Kirk Henckels

Douglas Elliman, Stribling & Associates

$16,000,000

655 Park Avenue

Amy Katcher

Corcoran Group

$13,100,000

40 West 77th Street

Ann Cutbill Lenane

Douglas Elliman

$11,930,000

11 Riverside Drive

Vickey Barron

Douglas Elliman

$11,437,500

212 West 18th Street

Source: StreetEasy and The Real Deal. Data is for closed deals filed with the city between March 26, 2014, and April 25, 2014, where both a broker and an address can be identified.

Chart includes only listing brokers.

132 May 2014 www.TheRealDeal.com

Reader Comments Response to story about landlord’s move to rent out a newly installed pool at an Upper West Side building after banning rent-regulated tenants from using it: “Good. If these people aren’t paying their fair share, then they shouldn’t enjoy all the spoils. Welcome to the real world, people. Rent regulation is an abomination. It’s basically a welfare program.”

Response to news about developer aiming to draw young people priced out of Brooklyn and Manhattan to a new project on Staten Island: “Might as well live in Jersey if you have to go to Staten Island.”

Response to story about rents in Bangladesh’s capital, Dhaka, topping rents in Manhattan: “I have lived in Dhaka, and yes, there are isolated, tiny pockets such as Gulshan where diplomats and wealthy American/European importers and exporters build their mansions, but the vast majority of the city is dirt cheap.

It’s like saying One57 represents the average NYC condo… utterly meaningless.”

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COMINGS & GOINGS Thrive-backed startup builds momentum

Movers and shakers

New York City–based real estate tech start-up backed by Joshua Kushner’s Thrive Capital is building momentum. Hightower, a real estate portfolio analytics service launched in July, enables commercial landlords and leasing brokers to track building performance. It shows inventory age and status, the time that it takes to get deals done and even where they’re losing deals — helping them to figure out prospective tenants’ deal breakers.

Hightower’s cloud- and mobile-based platform also enables leasing teams and landlords to collaborate on deal tracking from any device.

The startup, founded by Brandon Weber, Niall Smart and Donald DeSantis, closed its first round of seed funding in December, raising $2.12 million from investors including Bessemer Venture Partners and Thrive Capital. Thrive, founded by Kushner, also has interests in real estate-related start-ups like 42 Floors and Urban Compass. Kushner sits on Hightower’s board.

Hightower has earned credibility as major brokerages like Cassidy Turley, Jones Lang LaSalle and CBRE and institutional owners like Beacon Capital Partners have signed on to use the service. Last month, Hightower inked a deal with JP Morgan Asset Management.

“From the market’s perspective, we’re the new kids on the block,” said Weber, who, prior to founding Hightower did stints at Microsoft, Zillow and even at CBRE. “I was the nerdy broker,” he said. “When we would come in and present to institutional owners, we would bring with us forecasts of the market and micromarkets and analysis of development pipelines and the impact they would have on their building. I would manually aggregate that data. It was painstaking and incredibly slow, but it became kind of my calling card.”

Hightower has 14 employees and a 2,500-square-foot office at 149 Grand Street in Soho. Weber said they are looking to double that space.

“Everyone talks about commercial real estate as being an industry that’s 20 Hightower founders (top to years behind the curve in terms of technology, but it’s waking up,” Weber said. bottom) Donald DeSantis, Niall

By Katherine Clarke Smart and Brandon Weber

Michael Daly was named chief operating officer of Jonathan Rose Companies. He is responsible for managing the company’s operations, as well as for the expansion and diversification of it nationwide portfolio. Daly previously was president of Forest City Enterprises’ affiliate Mesa del Sol. Prior to that, he founded Sterling Glen Communities.

Robert Gibson joined JLL as vice chairman of New York retail brokerage, where he will be responsible for the growth of retail tenant and agency leasing. Gibson previously served as vice chairman of Cushman & Wakefield’s midtown Manhattan ofMichael Daly fice, where he was awarded Cushman & Wakefield’s Top Overall Producer Award in 2012. He has more than 26 years of retail leasing experience.

Rudin Management Company named Kevin Daly its vice president of commercial leasing.

He will be responsible for negotiating and closing office and retail leasing transactions throughout the company’s commercial portfolio, with a focus on downtown properties.

Daly has nearly 15 years of experience in both Robert Gibson tenant and landlord representation, and previously served as a senior director in Cushman & Wakefield’s Midtown office.

Jaime Schultz joined Lee & Associates Commercial Real Estate Services’ New York office as director of retail. Schultz previously served as a senior retail leasing associate at GFI Capital and as a sales associate at Douglas Elliman. She has more than seven years of experience.

Alexandrea Merrell joined Warburg Realty at its Tribeca office. She was also appointed managing Jaime Schultz partner for the nonprofit collaborative Green Building Center, where she will work with industry professionals to create energy-efficient and healthy building solutions. Merrell previously served as director of marketing at public relations agency Orndee Omnimedia and MerrellNYC, an environmentally friendly real estate development firm.

Alexandrea Merrell

A

Warburg taps Elliman vet for Brooklyn push

W

arburg Realty moved a step closer to breaking into Brooklyn by hiring a sales director to select a new location and potentially acquire smaller brokerages in the borough.

Michael Guerra joined the firm last month from Douglas Elliman, where he was managing director and executive vice president. The Park Slope native helped grow Elliman’s Brooklyn operation from one to five offices. He was previously a broker at the Corcoran Group and William B. May. Guerra is scouting locations. The plan is to open the first office in the borough in the next few months, he said.

Guerra said Elliman’s goal to become a large national brokerage eventually conflicted with his professional interests.

“I wanted to take a more personal approach to the business and to Brooklyn,” Guerra, who worked at Elliman for more than 7 years, told The Real Deal.

Preliminary recruiting for the Brooklyn office has already started, including among Warburg agents who frequently have listings in the borough.

But the number of agents will depend on the size of the space chosen by Michael Guerra the brokerage. Guerra said he expects several Warburg Brooklyn outposts to crop up over the next year.

By Mark Maurer

Ex-Gov. Paterson joins crowdfunding site

R

eal estate crowdfunding platform iFunding tapped former New York Gov. David Paterson to talk shop with lawmakers and business leaders as its community director.

Paterson is tasked with linking affordable housing initiatives with the social funding model of the website, which focuses on low minimum investment amounts. “iFunding couldn’t be more happy to have someone on our team with David Paterson Governor Paterson’s perspective on housing policy and real estate’s importance to community development,” William Skelley, iFunding’s chief executive, told Crowdfunding Insider.

Crowdfunding is growing in popularity among real estate investors and developers, in part because it provides a way to bypass traditional financing models like bank loans. So far, iFunding has funded 14 properties and raised nearly $24.7 million.

Crowdfunded projects in New York City include an apartment building at 151 Dupont Street in Greenpoint, Brooklyn, sourced by startup Fundrise, which has so far raised $225,000 of its $700,000 goal via accredited investors. Fundrise’s next project, a boutique hotel in Gowanus, aims to raise capital from unaccredited investors with shares starting as low as $100. By Angela Hunt

134 May 2014 www.TheRealDeal.com

Also on the move

Melissa Van Damm was named managing director of sales at Town West Village after serving as the firm’s director of representative relations and recruiting… Kellee Buhler was named sales manager at Town Financial District, while Christina Nguyen joined the firm as director of human resources… Charles Avolio, Tom Stachowiak and Chris Zegler were promoted to vice president and general managers at Turner Construction’s New York office.

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How Futterman arranged Hilfiger’s Miami hotel buy

R

obert Futterman happened to be sitting next to Tommy Hilfiger during an Art Basel Miami Beach party in December when the fashion icon mentioned his plan to launch a new hospitality venture.

That conversation planted the seeds for Hilfiger’s purchase of the Raleigh Hotel in Miami Beach, which closed last month, said Futterman, who brokered the deal for sellers David Edelstein, the developer of the W South Beach, and sbe founder and CEO Sam Nazarian.

The real estate heavyweight told The Real Deal he seized the opportunity to mention that Edelstein, a longtime client and investment partner, and Nazarian could be interested in selling the 105-room hotel.

Edelstein and Nazarian hired Futterman’s firm, HFF, to look for refinancing opportunities shortly before the chance encounter during the party at the Dutch restaurant at the W South Beach.

“It was a dinner I’m invited to every year by Edelstein and Aby Rosen,” Futterman said. “It’s somewhat celebrity-laden.”

Futterman said they chatted about the vision for Hilfiger Hospitality and potential locations in Miami, New York and Los Angeles. The two exchanged text messages the following day, and within four months, the Raleigh sale closed.

Hilfiger’s Elmira Miami paid $56.5 million for the

WE H E A RD

▼

two-property site. Extensive renovations are expected to begin by January 2015. Nazarian’s company is staying on as manager of the hotel.

Hilfiger wants to blend “art, fashThe pool at Miami Beach’s Raleigh Hotel. Robert Futterman, right, brokered the sale of the hotel to fashion ion, music and entertainment” at the icon Tommy Hilfiger, left, after a chance meeting.

Raleigh, Futterman said. “He thinks it’s a real extension to his celebrity and brand to be in that business.”

South Florida real estate professionals point to Art Basel as an underrated vehicle for transaction activity. The Raleigh sale is perhaps the highest-profile example of a deal originating during the annual event. By Eric Kalis

The leaky roof that sparked Jeff Sutton’s career

Jeff Sutton, left, got his big break when he was asked to bring Payless ShoeSource stores to New York.

J

eff Sutton, the founder and president of retail giant Wharton Properties, made a rare public speaking appearance last month at Baruch College, talking to students about his own personal history, the goals of his

company and his keys to success.

The real estate mogul, who owns over 120 properties citywide including 717 Fifth Avenue and 650 Fifth Avenue, and has signed major leases for flagship stores like

Giorgio Armani, American Eagle and Abercrombie & Fitch, recalled that he got his start in the industry at 30 years old.

“I’m sitting in this office and I get a call from the secretary. She says to me ‘There’s this guy out here, yelling and screaming about some roof leak.’”

Because the building manager was out that day, Sutton tried to help, found someone to fix the leak and ended up having a conversation with the man.

“We spoke for a little while and then he said, ‘Maybe we’ll do something together.’ I thought this is my lucky break.”

It took a few months, but when Sutton finally got a call back, the man offered him the opportunity to find locations for the first Payless Shoes stores in the city. That connection led to a deal to find spots for Foot Locker, which led to another deal for Gamestop and then to drugstore giant CVS, which helped him get established in Manhattan.

By Katherine Clarke

Ryan Serhant’s WeChat deal at the Baccarat? Not really his.

R

yan Serhant doesn’t seem content with the adulation and exposure he gets through “Million Dollar Listing New York.”

Last month, the Bravo star and Nest Seekers International broker got the credit for a trophy double-sale at the Baccarat Hotels & Residences that was conducted purely through social media.

The deal got Serhant shout-outs in the media, including New York Magazine and Fox Business News.

But Serhant was not involved. Douglas Elliman broker Emma Hao did the deal.

Hao said the sale began when she woke up to a voice message on popular Chinese social network WeChat from a prominent entrepreneur she met in China. The entrepreneur, who Hao declined to name, was interested in buying an apartment in the building with the “famous crystal brand.”

This was, of course, Starwood Capital’s Baccarat Hotel & Residences at 20 West 53rd Street.

Hao reached out to the building’s sales team at Corcoran Sunshine Marketing Group to see if units were available, and then used the social network to upload pictures of floor plans and renderings and to set up a group on the site, in which she,

136 May 2014 www.TheRealDeal.com

the buyer, the buyer’s attorney and the bankers ironed out the details of the deal. The buyer ended up purchasing two apartments for about $13.25 million total, without even visiting New York.

What was unusual about the deal was that the entire transaction was conducted through the social network — that’s what generated the publicity.

Hao’s unique sale in one of Manhattan’s most talked-about buildings was, as expected, picked up by the media — except it was Serhant doing Ryan Serhant and Emma Hao the talking, implying that it was his team that handled the transaction.

Serhant said in a statement that he never claimed responsibility for the transaction and “there is no doubt that Emma and Elliman deserve all of the credit.”

Hao initially said she felt “awful” about Serhant getting the credit.

Later, she said in a statement that the two had communicated during the deal. “[Ryan] is a very close friend and gave me great advice as I worked through the transactions,” she said. By Hiten Samtani

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THE CLOSING

WITH JEFF

WINICK

Jeff Winick is the founder and CEO of retail brokerage Winick Realty Group. He has personally leased more than 1 million square feet of retail space in New York and represents retailer clients like Duane Reade, AT&T and Starbucks as well as major landlords like the Durst Organization.

His 50-agent firm has leased more than 15 million square feet over the past 30 years, among the most of any retail firm in the city.

Name: JEFFREY WINICK Born: AUG. 2, 1950 Hometown: KEW GARDENS HILLS, QUEENS Marital status: DIVORCED Children: DANIELLE What can you say about growing up in Queens?

My junior high school and my high school faced the cemetery. You get out of high school, you go to college and then you get buried in the cemetery. But that cemetery has been filled up for a long time, so [thankfully] I don’t have to worry about going there.

What were you like as a kid?

Athletic. I played baseball, basketball and football.

Where did you go to college?

I didn’t. After high school, I went straight into fashion, designing ladies accessories. My family was in the accessories and trimming business. If you bought a dress, they made the trimmings. Belts, lace and ruffles — all that stuff. I did that from 1968 until 1976. In 1973, I won a design award from the leather industry for my belts.

So how did you end up going into real estate?

Someone knocked on my door one day and wanted to buy my apartment. I told her my apartment [which was in Manhattan] was a rental, but she said it was going coop. I started buying tenants’ rights in buildings that were going co-op. I would buy the apartments or flip them to third parties. That was my beginning in real estate. At one point, I had 168 furnished apartments in New York.

But then you moved into retail …

Residential wasn’t fashionable enough for me. I sold off my residential portfolio and went into retail in the ’80s.

I opened up a company with about 15 brokers and here we are today. My first deal was for a 2,000-square-foot store on 97th and Broadway. The tenant was probably a Subway or a Blimpie’s.

Where do you live?

In a very modern apartment on 54th Street and First Avenue. That’s why our office is on 42nd and Third.

Do you have any other homes?

Yes. In Southampton. I go out there on weekends in the summer. I love boating. I love the ocean and the beach.

Are you married?

I was married for a couple of years a long time ago. My exwife [Lizette Winick] is a residential broker at Corcoran.

My daughter, Danielle, is 20.

138 May 2014 www.TheRealDeal.com

Are you single and looking?

Are you married? Let’s go out tonight…

What would you put in your personal ad?

I pull no punches, and you better have a lot of energy to stay up with me. I love the sun and I love fast cars.

Do you have a collection of cars?

I have three cars. I love my Mercedes convertible. When I was growing up, someone pulled up next to me in a Corvette and wanted to drag race. I said “this is not for me.”

I’ve been in a Mercedes ever since.

You recently lost a lot of weight.

I lost 55 pounds. I wanted to get rid of the diabetes, which I was diagnosed with 10 years ago. I’m self-cured. Three months ago, I went off all medication. I went to see some really good doctors and watched what I ate. I quit smoking, too.

What inspired the change?

Certain people come along and they change your life.

Plus, my daughter kept on beating me up saying, “Dad, I want you around for my wedding.”

Did you ever want to have more kids?

I wouldn’t rule out having another child. They keep you young. Maybe someday, if someone will put up with my personality.

Who are your closest industry friends?

Joe Moinian, Larry Gluck, Meyer Chetrit, Richard Wagman, Joey Jacobson and David Berley.

Are you a tough boss?

If you can survive me, you can become a very successful broker. I don’t hold peoples’ hands.

Do you live extravagantly?

I collect Rolexes. My favorite is the one I’m wearing, which is the cheapest one they make.

You’re renowned for your wild parties at ICSC. What are they really like?

We have a pool party and a couple of tables at the club at night, that’s all. It’s just a bunch of people having a good time. You wrote that I fill my pool in the Hamptons up with Cristal every weekend. I’d have to be a billionaire to do that. They wouldn’t have enough Cristal in the country to fill up my pool.

Is there a special lady in your life you’re talking about?

There was a lady. I’m not sure what status it’s in right now.

She’s a photographer.

People say you’re an aggressive deal-maker.

I don’t think being a passive broker makes you successful.

I’m not afraid to tell a tenant when he’s wrong or a landlord when he’s wrong.

Tell me about your daughter, Danielle.

She interned at Vornado last year. She was the only intern there with a sales license. She’s going to come here this summer and work for us. She’s my whole life.

Are you a workaholic?

I’m a deal junkie. It’s not just about money. It keeps me young. I get a big rush from it, whether it’s a $5,000 commission or a $100,000 commission. By Katherine Clarke PHOTOGRAPH FOR THE REAL DEAL BY July STUDIO SCRIVO00 www.TheRealDeal.com 2006

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