the commercial observer - sept. 14, 2010

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September 14, 2010 The Weekly NeWspaper of NeW york’s CommerCial real esTaTe iNdusTry $7.00

Coverage starts on page 18

Happy BirtHday

➧ Our Big Look Back at Industry Power Brokers

➧ Prospective Tenants: How Right We Were

➧ Knakal on Why He Writes Concrete Thoughts

➧ Chandan Looks (Far) East for Next 12 Months

➧ And Steve Spinola Wishes Us Many More!

to Us!The Commercial Observer Turns 1!

observer.com | the commercial observer2 September 14, 2010

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in this week’s issue Vol. 2, no. 36

4 The Week in Real EstateBy Heather Holland and Laura KusistoMonday Properties’ 230 Park wins major LEED nod. SL Green sells 19 West 44th. And malls expected to fill some of that empty space, CB Richard Ellis says.

8 Lease BeatBy Emily Geminder and Laura Kusisto* 384 Bleecker Street* 155 Fifth Avenue* 550 Seventh AvenueAnd dozens more of New York’s latest commercial leases.

ONE-YEAR ANNIVERSARY SPECIAL

18 The Op-EdBy Steven SpinolaThe Real Estate Board of New York had a busy year, too.

20 The Lead IndicatorBy Sam ChandanLessons from the Far East as we edge into Year Two of the recovery chatter.

24 Power BrokerBy Jotham SederstromExcerpts from 12 months of our Power Broker profiles.

32 The Sit-DownBy Jotham SederstromWhat was said when we in-vaded Big Real Estate’s corner offices.

42 Prospective TenantsBy Dana Rubinstein and Tom AcitelliHow right we were about some of the biggest tenants looking for space.

48 Building StoriesBy Emily Geminder and Tom AcitelliEvery building in New York tells a story. Here are several.

56 Concrete ThoughtsBy Robert KnakalWhy our intrepid columnist writes his columns (and he does write them!).

62 CalendarBy Jotham SederstromThe week ahead in events.

64 The LobbyBy Jotham SederstromStudley promotes several; Col-liers International poaches from CBRE.

36

the commercial observer | observer.com September 14, 2010 3SLG-1987 555 W 57th CBS Tomb-10x12.25.indd 1 8/13/10 11:27 AM


the week in real estate SEPTEMBER 7 - SEPTEMBER 14

By heather holland

CBre: Mall shoppers to rise again in 2011

The return of the eternally undead consumers to the suburban mall sig-nals that retail may rise again.

A CB Richard Ellis report re-leased Sept. 8 shows that shopping center availability will begin to de-cline next year. For once that means the boroughs may have it best, as the report’s findings apply primar-ily to mega-complexes in places like Long Island, including Brooklyn and Queens, a CBRE spokesman said.

New York—outer boroughs in-cluded—is one of 14 markets that saw a decline in the availability of retail space this year, meaning more shops and stores opening up. That puts the city a bit ahead of the real estate curve, as across the coun-try retail availability is expected to decline starting in 2011. Shooting ahead, however, are San Francisco, Newark, Jacksonville, Cincinnati and Trenton.

Consumer spending was up 0.4 percent nationally in July, according to the Commerce Department, but only after three previous lackluster months.

Still, we’re coming off “some of the lowest points in retail sales his-tory,” the report’s author, CBRE economist Abigail Marks, cautioned. —Laura Kusisto

sl Green sells Brim-ming 19 west 44th

SL Green, the city’s largest office landlord, has agreed to sell 19 West 44th Street for $123.2 million to Deka Immobilien, a German real es-tate investor.

That’s nearly double the $67 million that SL Green paid for the 292,000-square-foot building in

2004. The company plans to invest the $118 million in net proceeds to-ward 125 Park Avenue, which it agreed to buy from Shorenstein Properties for $330 million, The Real Deal reported.

The sale comes just as the build-ing has scored a new tenant, For-est Management, which signed a 17,684-square-foot lease for 11 years, The Commercial Observer reported last week. Since SL Green took over, occupancy in the building has in-creased to 99 percent, up from 86.

The sale is expected to close this fall. —Laura Kusisto

Monday’s Gem Grabs Green Gold

New York’s golden landmark has gone green.

The Helmsley Building may glitter in the sun, but until recently it was producing a dark cloud of carbon

emissions. Now, thanks to a $100 million renovation that included double-paned windows, a high-tech system to monitor energy use, and better cleaning and trash disposal practices, Monday Properties has received LEED Gold certification for 230 Park Avenue, Hani Salama, the firm’s vice president of operations, told The Observer. It is the first pre-war office tower in New York City to hit that mark.

The 1.4 million–square–foot, top-shelf building will belch 7,000 fewer tons of carbon a year—or about the amount of energy consumed by 300 U.S. citizens every year. “These were good changes,” said Mr. Salama. They may have cost a little bit more in the short-term, “but the plus out-weighs the negative,” he added.

The building’s largest tenant, ING, which occupies more than 200,000 square feet, has undergone a green-ing project of its own, receiving

LEED Gold certification for its exec-utive offices in 230 Park, and reduc-ing its overall energy consumption in the building by 30 percent.

Monday owns buildings in Virgin-ia, Washington and New York. But Manhattan’s coveted prewar build-ings pose the biggest greening chal-lenge, Brian Robin, chief operating officer at Monday, said in an inter-view. “Two-thirty had this terrific pop in that it’s one of our most im-portant assets,” he said.

Monday is in the process of in-troducing a monitoring system that will help building managers identify where their buildings are wasting energy. Next the landlord will apply its green thumb to 1440 Broadway, an 85-year-old, 750,000-square-foot building just south of Times Square.

$85 M. Mortgage

A subsidiary of Forest City En-terprises closed on an $85 million mortgage for its 312,000-square-foot property at 234 West 42nd Street, reports The Real Deal. It’s a 10-year,

fixed-rate mortgage, and new fi-nancing ensured an interest rate that is 325 basis points lower than that of the loan it replaced, increas-ing the cash flow generated by the property.

$85 M. sale

Hearst’s Argonaut build-ing at 224 57th Street sold

for $85 million, reports The Real Deal. An in-vestment group based

in Beirut purchased the 10-story build-

ing; the sale went into contract June 23 and closed August 26.

Vornado subsidiary Pitch

Vornado Realty is selling its sub-sidiary, Merchandise Mart Properties Inc., for $1 billion in order to “simpli-fy and prune” its holdings, reports Crain’s. The sale comes at an oppor-tune time as the Mart has come out a bit battered from the recession, and it doesn’t quite fit the company’s core business of owning office and retail properties in New York. This sum-mer, Cohen Bros. Realty Corp. offered $1.25 billion for most of Mart’s as-sets, but the deal fell through and the reason still remains unclear.

Meredith hunt

Meredith is shifting gears and looking farther east to find its new home, reports the New York Post. The company began negotiating for a large space at Hiro Plaza, where the publisher already had offices, but it has now moved its gaze to the Durst Organization’s nearby 205 East 42nd Street. The building has 375,000 square feet available, and Meredith wants to consolidate in about 250,000 square feet.

183 Madison deal?

The property at 183 Madison Av-enue is inches away from being con-tracted by a British group for near-ly $75 million, putting the price at about $300 per square foot, reports the New York Post. Bidders for the 250,000-square-foot building had in-cluded Sitt Asset Management and the Kaufman Organization.

n.y.U. Condo Buy

New York University purchased a commercial condo on the third floor of the Silk Building, at 14 East 4th Street, for $9.9 million. The school went into contract for the 12,851-square-foot condo in March 2007, and closed Sept. 1. The deal is one of $200 million in purchases made by the school this year, includ-ing the Forbes building on Fifth Ave-nue and a 26-story dormitory build-ing known as Founders Hall at 120 East 12th Street. The new purchase will be used for back-office purposes and for housing.

STAT of The WeeK

take-offThe midtown class A average asking rent gained altitude for the third

straight month in August, the longest period of growth since the spring of 2008. Though the increases were very slight for June and July, August saw an asking rent increase of just over 1 percent, closing the month at $65.05 per square foot.

It now appears that midtown may have hit bottom in May of this year, with a figure of $64.18 a foot, though there are a lot of air pockets that could get in the way before making it to cruising altitude—office job cre-ation being first on the list. The midtown class A figure remains 34 percent off its record high set back in May 2008: $99.22 a foot (and still lower than even the first quarter of this year).

—Robert Sammons of Cassidy Turley

the commercial observer | observer.com September 14, 2010 5

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Jared Kushner, PublisherRobyn Weiss, Associate PublisherKyle Pope, Editorial DirectorTom Acitelli, Editor

Dana Rubinstein Staff Writer Robert Knakal, Sam Chandan, Columnists Jotham Sederstrom, Emily Geminder, Laura KusistoContributing Writers Nancy Butkus, Art Director

Tyler Rush, Production ManagerChris Cronis, Copy EditorPeter Lettre, Photo EditorLisa Medchill, Advertising Production

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Corigin Holdings is forming in the stead of the Coalco New York division, taking as-sets associated with Coalco New York with it, reports GlobeSt. Corigin will focus on pri-vate equity and commercial real estate, mak-ing two divisions, Corigin Real Estate Group and Corigin Private Equity Group. Former chairman of Coalco New York, Ryan Freed-man, is the CEO and chairman for the newly launched real estate group.

Bank Building Returns

The Jarmulowsky Bank Building at the corner of Canal and Orchard streets returned to the market for $37 million, an increase from the $25 million it sold for in 2005, re-ports The Wall Street Journal. Central City Brokerage Corp. is the brokerage marketing the 12-story, 60,000-square-foot property. Central City hopes to entice buyers by mar-keting the property as an investment proper-ty for developers interested in converting the building into a hotel or condominium.

Toren Taps CPEX

The Toren, the downtown Brooklyn condo developed by BFC Partners, hired CPEX as exclusive leasing agent for its 13,000 square

feet of retail space. The space had been with-out an agent for nearly a year and a half.

Moinian vs. Related

Joseph Moinian is seeking financing from SL Green in order to stop the Related Compa-nies from buying his mortgage at 3 Columbus Circle, foreclosing on the office tower, tearing it down and building a more modern tower in its place, the New York Post reports.

Boomism Lives! 111 Eighth

Owners of the building at 111 Eighth Avenue have put a fat $2 billion price tag on the property, hoping the market has improved enough that buyers are willing to pay prices not common since the boom earlier this decade, reports The New York Times. The 15-story building is nearly 3 million square feet, making it the fourth-largest office building in New York City. Tenants include Google, Nike USA and barnesandnoble.com. The outcome of this venture may say a great deal on the current health of New York’s real estate market.

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Lease Beat by Laura Kusisto

384 Bleecker Street ’Tis the season of fashion, and Mi-

chael Kors has celebrated by open-ing yet another retail location.

The designer to the fabulous set has signed a 12-year lease for a cor-ner spot at 384 Bleecker Street in Greenwich Village, totaling 1,475 square feet.

“Michael Kors will be an excit-ing new addition to this prestigious stretch of West Village real estate,” said Joel Isaacs, of Isaacs and Com-pany, who represented the landlord, Beck Street Capital, along with Da-vid Baker.

Fashionistas were somewhat dis-mayed at the departure of cheery

clothing vendor Olive and Bette’s to make way for the latest addition to the Kors chain. “You can’t swing a dead cat without hitting a Michael Kors store,” declared popular fash-ion blog Shophound.

Not quite. But the designer has been rapidly increasing his indepen-dent retail presence. Since March,

Kors locations have also popped up on Madison Ave-nue and Fifth Avenue, in the Flatiron district.

Richard Hodos and Ste-phen Sjurset of CB Rich-ard Ellis represented the tenant.

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LEASES OF THE WEEK

490 Broadway Soho’s impossibly hip

490 Broadway has proven it’s still got it. The building has leased three full floors to one new tenant and one old one.

The Corcoran Group has renewed its lease for 12,000 square feet for the sec-ond and third floors for five years. Meanwhile, creative firm Trollbäck + Company has taken 7,000 square feet, or the entire fourth floor, in a long-term lease.

“This is a wonderful ‘Old New York’ building,” said Eric Cagner, of Newmark Knight Frank, which rep-resented landlord Broad-way Landmark Corpora-tion. “Ever since it opened, in 1857, it’s been a destina-tion for creative business-es.”

Indeed, the original tenant, E.V. Haughwout & Co., was said to have sold a mauve tea set to Mary Lincoln (apparently, that was considered very chic at the time). The building

languished until it was re-stored in the late 1990s, and now boasts tenants such as Oprah fav the American Terry Corporation.

The building is now months into a complete makeover, including a full facade renovation and a new automatic elevator. That seems appropriate for the building, which pio-neered New York’s first safe elevator.

The city’s aesthetically inclined tenants need not despair. The top floor will also open up later this year,

with 15-foot-high, tin-fin-ished ceilings and 24 win-dows. “It’s in many ways the most picturesque part of the building,” said Mr. Cagner. “It’s a perfect des-tination for hip, creative tenants looking to have a full-floor presence.”

Asking rents are around $40 a square foot, accord-ing to a Newmark spokes-woman.

Andy Weiss of Signa-ture Partners represented Trollbäck + Company. No broker represented Corc-oran in the deal.

Gorgeous 490 Broadway Seals Two Deals for 19K Feet

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155 Fifth Avenue There’s good news this

week for those perpetually late in ordering their holiday fruit baskets. Harry & David will open its first temporary location in New York City, just in time for some seasonal pro-crastination.

The Oregon-based maker of luxury fruit baskets has signed a four-month lease at 155 Fifth Avenue, in the Flatiron district, Crain’s reports. The pop-up store will open this week, and includes 4,500 square feet on the ground floor, a 4,800-square-foot basement and a 2,100-square-foot mezzanine.

Asking rent for a long-term lease on the ground floor would be around $250 a square foot, according to Crain’s.

“Their things are specially geared toward holiday time,” said Robin Abrams, of Lansco Corp., who represented the landlord.

Those divine pears first came to New York City by mail from the Rosenburg brothers’ or-chard in Oregon. But they didn’t sell well dur-ing last year’s lean holiday season. Sales were down 13 percent, though in general the com-pany’s retail stores have fared slightly better than the mail-order business.

Even if the pop-up store does well, it’s un-

likely Harry and David will stick around once the twinkle lights are turned off.

“Like most companies that focus on gifts rather than self purchases, [Harry & David] does most of [its] business in the fourth quar-ter, so it won’t be cost effective to pay New York City rents the other eight months of the year,” Meredith Schwartz, of Gifts & Decora-tive Accessories magazine, told Crain’s. But Ms. Schwartz said she could see the retailer popping up again around Mother’s Day or Val-entine’s Day.

Ms. Abrams represented the landlord, the Eretz Group, along with Melissa Rose in-house. Newmark Knight Frank Retail repre-sented Harry & David.

Gift-Basket Kingpins Pop Up on Lower Fifth


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Lease Beat by Laura Kusisto

106 East 23rd Street Such is the irresistible

power of nostalgia that the analog camera, which seemed only recently a clunky relic of ’90s road trips, is back.

Lomography, a niche re-tailer offering pre-digital cameras, accessories and processing services, will open its second New York location, at 106 East 23rd Street, be-tween Lexington Avenue and Park Avenue South.

The new, 2,400-square-foot space joins its other lo-cal spot, at 41 West Eighth Street in Greenwich Village. The company has 14 interna-tional locations.

If the charm of blurry pho-tos with awkward facial ex-pressions hasn’t rubbed off on you yet, it may be time to get up from your computer and visit one of the compa-ny’s stores. Its online pres-

ence consists mainly of an arty MySpace page and a stub Web site with the slogan “Get Lomographic!”

Of course, the store’s ex-pansion comes not long after the mass closing of tradition-al camera retailers such as Ritz Camera in the past few years. (Perhaps this will give

struggling CD retailers a rea-son to hang on.)

Steven Baker and Mi-chael Gleicher of Winick Realty represented the land-lord, Abington Holding. Al-bert Rashtian of European American Properties repre-sented the tenant.

say Mozzarella! Old-school Camera shop Opening second City spot

550 Seventh Avenue Fashion Accessory Bazaar has grabbed

a spot in the garment district from which to launch a glamorous collaboration of indie de-signers.

Carlos Falchi and Isabella Fiore will move into 11,695 square feet at 550 Seventh Av-enue, near 40th Street, the New York Post reports. The two high-end indie handbag de-signers are being brought together under FAB’s fledgling Artisan House division.

FAB already makes handbags featuring Hello Kitty, Hanna Montana and Spider-Man, but now it hopes to snag buyers with more so-phisticated tastes. Rihanna sometimes sports a shiny silver Falchi; Katie Holmes and Kate Hudson favor Fiore’s embroidered look.

Falchi is currently located at 260 West 39th Streeet; Fiore will hop a couple of blocks

over from 80 West 40th Street. The designers will join Ralph Lauren in their new Art Deco home.

Michael Beyda and Abie Cohen of Bench-mark Properties represented the tenant. Mi-chael Heaner of the Kaufman Organization represented the building. The asking rent was $42 a square foot, according to the Post.

Fashionistas to Go Higher-end with 11K-Plus Feet at 550 seventh

PR Giant edelman expanding in soho with 27K-Foot Deal

250 Hudson Street The proliferation of bad

news in corporate America has proven good news for PR giant Edelman. The company will take an additional 27,000 square feet at 250 Hudson Street.

Edelman’s clients include Kraft, Apple, Starbucks, Wal-Mart and the Falkland Islands, to name a very few. It will occu-py a total 168,000 square feet in the building, which features an environmentally friendly green roof that we can only as-sume is good for PR.

Edelman has increased its

staff by 30 percent, to nearly 600 people, as of this month. It reportedly loves the Soho spot, which it moved into a year ago, because it allows the staff to rub elbows with its bestest friend, the media. “There are a lot of media com-panies down here, and there’s lots going on,” Robin Callif, the firm’s local chief of staff, told Crain’s.

Asking rent was around $43 a square foot for the 14-year deal, which is set to ex-pire along with the company’s other leases.

Mary Ann Tighe of CB

Richard Ellis represented the tenant, along with Ken Mey-erson. Landlord Jack Resnick & Sons was represented in-house by Dennis Brady and Jonathan Dean.

MORe Lease BeatON PaGe 67


The scene: Midtown office of a midsize ad agency.

The dramatis personae: Company’s VP for operations, attorney and broker.

The discussions to this point: On the table is a draft term sheet for a 15,000 rsf lease at a rent which is 20 percent lower than tenant is currently paying; also a $42 per rsf TI (tenant improvement) allowance.

(We now listen in on the conver-sation …)

Tenant: You know that $48 rsf rent is great, gonna save us a [boat]load of money over the next 10 years, but I’ve been reading the trades and understand that [insert name of latest high-profile financially chal-lenged landlord] is way deep under-water on a number of mortgages, and we’re concerned about getting our TI money—hey, $600,000 ain’t chicken feed—and, for a our cor-porate image, his ability to provide Class A building services—the lobby, office cleaning, etc. That’s essential.

Lawyer: Well, let’s make getting an SNDA a must here, and also we’ll look for an L/C on that TI work or an escrow. Maybe rent set-offs and self-help too. …

Broker [gazing off into the distance, mo-mentarily caught up in his own thoughts about the subject]: (to himself) Hmmm. I better fig-ure out how I’m gonna make sure my six-fig-ure commission gets paid ... especially as half is due six months after signing. Gotta find that memo on this to all brokers from the compa-ny’s new international HQ office in Saigon on this. Try for an escrow? Commission in lieu of rent? Nah, that will never fly. Broker’s Entitle-

ment Affidavit? (Does that apply to commer-cial leases?) Well, there’s always a lien action … but who’s gonna pay for the litigation?”

I don’t think the above scenario is too far from reality in today’s troubled real estate market. But what does it all mean?

Protecting Tenants, Subten-ants and Brokers From Land-lord Defaults

Here’s a topic that was not on the radar screen 25 years ago but would have been considered almost laughable if presented as part of a Continuing Ed pro-gram or as suitable for a leasing law column. But here we are. It’s 2010, and the market today is still in the crapper; pockmarked with overextended landlords who paid hyperinflated prices for properties with borrowed mon-ey, all having been predicated on ever increasing dollars per rsf.

Well, then came Lehman Brothers and the worldwide financial debacle. Now with debt service often far outstripping income, many landlords are in trouble. Most talking real es-tate heads predict continuing stormy seas for property owners who may be upside down in their current loans. This gloomy POV is sup-ported by recent numbers indicating that al-most $46 billion in defaulted CMBS loans are outstanding.

To be a bit Talmudic here (’tis the season, af-ter all) we ask—rhetorically—what is the mean-ing of all this for that advertising company in our drama and others similarly situated? This

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Now, we all have gone thru market cycles of different di-mensions. That—by defini-tion—is a market (anyone remember “Stay Alive ’til 95?”), but nothing as nega-tively charged as today’s climate.

means landlords and tenants can ex-pect to see some significant turnover in ownership of commercial proper-ties in the coming years, particularly through commercial foreclosure ac-tions. Now, we all have gone through market cycles of different dimen-sions. That—by definition—is a mar-ket (anyone remember “Stay Alive ’til 95?”), but nothing as negatively charged as today’s climate.

So what can (should) the tenant-side players in the leasing communi-ty do to safeguard the status of their leases and, as to their brokers, make sure they get paid the commissions they’ve worked so hard to earn? We’ll start this investigation by looking from the tenant’s perspective.

Protection From What and of What

First, from what:1. Foreclosure: lease termination

by reason of lenders canceling out the subordinate interest that the lease represents.

2. Money defaults: for example, how to protect commitments to pay for TI allowances.

3. Performance default: for ex-ample, landlord’s work and build-ing services (everything from HVAC to keeping the passenger cab brass shiny and fresh flowers in the lob-by).

4. Overall, landlord bankruptcy, and the adverse consequences to the commercial tenant.

Second, with what (to the tune of “Here Comes the Sun”—not exactly, but don’t lose hope; all is not lost):

1. SNDA: Subordination, Non-Dis-turbance and Attornment Agree-ment: The Lender agrees that if it forecloses on its mortgage lien, the lease will not be “disturbed”; ten-ant’s rights are (with various cave-ats) protected (especially impor-tant if tenant is investing significant money in its initial installations).

2. Letter of credit, attorney es-crow account: to secure landlord’s financial obligations to tenant, or as another alternative …

3. Rights of set-off (set-off against fixed rent and other payments com-ing due under the lease).

4. Self-help: Hire someone to per-form the work required, at the land-lord’s expense.

5. Rights of recourse: A landlord in financial distress may reduce build-ing services, maintenance or capital improvements to the property in or-der to save money. (Off-topic tenant-leasing tip: lease language—provide a very specific level of service).

Tenant then looks at: 6. Legal action (including claim

of constructive eviction) for a wide

range of relief, such as damages, re-scission, or specific performance. (Practical problem: It’s time-con-suming and may not give sufficient protection.)

(Pssstt—really practical pointer: Go with a quality landlord—one with a good reputation and no mortgages in default etc. That, dear reader, is 99 percent of the battle.)

Space limitations mean we can’t go into a detailed discussion of each

point, but let’s do a Richard Dawson–style “number one answer”:

SNDA: Subordination, Non-Dis-turbance and Attornment Agree-ment.

Subordination: The tenant agrees that the lien or priority of its lease is

expressly subordinate to the lien of the mortgage.

Non-Disturbance: The lender agrees that if it forecloses against the landlord’s interest, terminates same, it will leave the tenant alone; it will not disturb (disrupt) the ten-ant, not terminate the lease; and

Attornment: The tenant agrees that if through foreclosure the lend-er or some other party succeeds to the landlord’s interest, then the ten-ant will recognize (attorn) (turn) to the new party as its landlord for all purposes under the lease.

O.K. So we’ve all agreed, the lat-est chapter in our real estate saga is aptly titled “Dark Clouds on the Ho-rizon” (a little spooky, no?). But let’s say you’ve requested and have the clout to get an SNDA from the land-lord’s lender. What does the SNDA look like? Fair and balanced? Not at all. It is a totally lender-oriented form. So what’s the downside for the tenant in the seven pages of single-space verbiage? Isn’t it enough to say, “Hey, I got my SNDA?”

No, it is not. We read carefully and we see, for example that if the lender becomes your new landlord, it is not bound by any prior landlord lease defaults and no right of offset survives. So from the get-go, kiss goodbye that unfunded, unsecured

$600,000 in TI money and the care-fully crafted rights of set-off against rent your street-smart attorney ne-gotiated. Free-rent periods in the third and sixth lease years? Nope, those get jettisoned. Also, you’ll likely see specialized insurance pro-visions to the effect that the lender can glom all casualty proceeds, thus effectively emasculating important lease provisions regarding the land-lord’s restoration obligations; and it’s also been pointed out that cer-tain hard-fought-for special protec-tions in the event of a claimed de-fault may be also be sacrificed.

Bottom line is that the SNDA is more than a mere lease-housekeep-ing checklist item. The SNDA can be a two-edged lease-altering sword with—per the above examples—some very unpleasant repercussions for the overly trusting or altogether too casual tenant team. [email protected]

Jeffrey Margolis is founding princi-pal of the Margolis Law Firm in New York City where he specializes in “dirt law”—buying, selling and leasing. He writes monthly for The Commercial Observer on legal issues. This discus-sion as to protecting tenants, subten-ants and their brokers from landlords in distress will continue next month.

law column


18 | Crain’s New York Business | July 26, 2010

CoStar’s Top Manhattan Office Leasing DealsBiggest transactions in �rst-half 2010, ranked by square feet

Address Square feet Tenant Tenant representative Landlord/sublandlord Landlord/sublandlord representative

1 11 Times Square Proskauer Rose CBRE SJP Properties CBRE Times Square

2 1411 Broadway1 385,759 Jones Apparel Group Inc. CBRE The Blackstone Group Equity Office Properties Penn Plaza/Garment

3 787 Seventh Ave.2 352,418 Willkie Farr & Gallagher CBRE 787 Holdings CBRE Columbus Circle

4 55 E. 52nd St.2 295,452 McKinsey & Co. CBRE Fisher Brothers Management Co. Fisher Brothers Management Co. Plaza District

5 620 Sixth Ave. 276,000 Service Employees International Union Newmark Knight Frank Jamestown Management Corp. Cushman & Wakefield Inc. Chelsea

6 200 Fifth Ave. 260,994 Tiffany & Co. Studley L&L Holding Co. CBRE Chelsea

7 777 Third Ave. 246,500 Avon Products CBRE/Cushman & Wakefield Inc. Sage Realty Corp. Jones Lang LaSalle Plaza District

8 125 W. 55th St.2 201,700 Katz Media Group Inc. CBRE Boston Properties Inc. Boston Properties Inc. Columbus Circle

9 1 Broadway 2 199,240 Kenyon & Kenyon CBRE Logany Colliers International NY World Trade Center

10 450 W. 33rd St.3 166,479 GMHC Cushman & Wakefield Inc. Broadway Partners Fund Manager Studley Penn Plaza/Garment

11 605 Third Ave.3 130,740 United Nations Population Fund Colliers International NY Fisher Brothers Management Co. CBRE Grand Central

12 110 William St. 116,540 New York Liquidation Bureau Jones Lang LaSalle Swig Equities Swig Equities Insurance District

13 75 Varick St. 114,605 Horizon Media Newmark Knight Frank Trinity Church Real Estate Cushman & Wakefield Inc. Hudson Square

14 333 W. 34th St. Metropolitan Transportation Authority SL Green Realty Corp. Cushman & Wakefield Inc. Penn Plaza/Garment

15 601 W. 26th St.1 112,741 McGarryBowen CBRE SL Green Realty Corp. 601 West Associates Chelsea

16 399 Park Ave. 111,728 PineBridge Investments Studley Boston Properties Inc. CBRE Plaza District

17 260 Madison Ave.1 110,000 McLaughlin & Stern Grubb & Ellis The Sapir Organization The Sapir Organization Grand Central

18 521 W. 57th St.2 107,726 CBS Broadcasting Inc. CBS Corp. Himmel + Meringoff Properties Meringoff Properties Inc. Columbus Circle

19 26 Broadway4 106,431 NYC School Construction Authority Newmark Knight Frank The Chetrit Group Newmark Knight Frank Financial District

20 127 W. 25th St. Bowery Residents’ Committee Inc. Cassidy Turley 127 West 25th LLC Colliers International NY Chelsea

21 512 Seventh Ave.1 101,855 G-III Apparel Group Ltd. Newmark Knight Frank The Chetrit Group Newmark Knight Frank Penn Plaza/Garment

22 220 E. 42nd St. 2, 5 100,602 WPIX-TV Channel 11 Cushman & Wakefield Inc. SL Green Realty Corp. SL Green Realty Corp. Grand Central

23 10 Hudson Square1 97,000 Kirshenbaum Bond Senecal + Partners Studley Trinity Church Real Estate Trinity Church Real Estate Hudson Square

24 420 Lexington Ave.2 87,944 New York Life Insurance Co. Cushman & Wakefield Inc. SL Green Realty Corp. SL Green Realty Corp. Grand Central

25 1 Penn Plaza1 87,400 URS Corp. Studley Vornado Realty Trust Vornado Realty Trust Penn Plaza/Garment

26 750 Third Ave.3 85,776 Reader’s Digest Association Inc. Cushman & Wakefield Inc. SL Green Realty Corp. CBRE Grand Central

27 1 Liberty Plaza2 81,742 Royal Bank of Canada None Brookfield Properties Management None World Trade Center

28 666 Fifth Ave.2 80,830 Vinson & Elkins CBRE Tishman Speyer Tishman Speyer Plaza District

29 250 Broadway 2 79,810 State of New York Direct Amtrust Realty Corp. USA Inc. Newmark Knight Frank City Hall

30 1411 Broadway 78,067 Jacques Moret Direct Swig Burris/Blackstone Group Cushman & Wakefield Inc. Penn Plaza/Garment

31 601 Lexington Ave. Citadel Investment Group CBRE Boston Properties Inc. Jones Lang LaSalle Plaza District

32 3 World Financial Center 4 76,241 Royal Bank of Canada None Brookfield Properties Management None World Trade Center

33 77 Water St. 75,716 Lewis Brisbois Bisgaard & Smith CBRE/Studley 450 Seventh Ave. Associates Cushman & Wakefield Inc. Financial District

34 200 Park Ave. 75,574 Korn/Ferry International Cushman & Wakefield Inc. Tishman Speyer Tishman Speyer Grand Central

35 40 W. 57th St. 75,000 Elliott Associates Newmark Knight Frank The Lefrak Organization CBRE Plaza District

36 30 Rockefeller Plaza Haynes and Boone CBRE Tishman Speyer Tishman Speyer Plaza District

37 529 Fifth Ave.2 74,553 Citrin Cooperman & Co. CBRE Loeb Partners Realty Silverstein Properties Inc. Grand Central

38 2 World Financial Center 3 74,380 Nomura Holding America Inc. Cushman & Wakefield Inc. Brookfield Properties Management Jones Lang LaSalle World Trade Center

39 111 Eighth Ave.2 71,302 XO Communications Jones Lang LaSalle Taconic Investment Partners CBRE Chelsea

40 1675 Broadway 69,422 Publicis Groupe Byrnam Wood Rudin Management Co. Rudin Management Co. Columbus Circle

41 345 Park Ave. 63,808 Piper Jaffray Jones Lang LaSalle Rudin Management Co. Rudin Management Co. Plaza District

42 55 E. 52nd St. 62,258 MF Global Holdings Jones Lang LaSalle Fisher Brothers Management Co. CBRE Plaza District

43 245 Park Ave. 59,714 Ares Capital Corp. Grubb & Ellis Brookfield Properties Management Brookfield Properties Management Grand Central

44 135 W. 50th St. 59,378 Jewish Board of Family and Children’s Services Cumulus Corp. UBS Realty Investors CBRE Columbus Circle

45 150 Varick St.1 58,125 Wieden + Kennedy Inc. Studley Greiner-Maltz Co. Greiner-Maltz Co. Hudson Square

46 16 E. 34th St.2 58,098 Charles Komar & Sons Inc. Centric Real Estate Advisors SL Green Realty Corp. SL Green Realty Corp. Murray Hill

47 352 Park Ave. South 2 58,000 NYC School Construction Authority Newmark Knight Frank MD Carlisle Realty Corp. Direct Gramercy Park

48 500-506 Seventh Ave.3 57,818 Mount Sinai Hospital Newmark Knight Frank The Moinian Group CBRE Penn Plaza/Garment

49 125 Park Ave. 56,772 HMX Group Cushman & Wakefield Inc. Shorenstein Realty Services Newmark Knight Frank Grand Central

50 565 Fifth Ave.1 56,311 Morvillo Abramowitz JDF Realty Inc. Kipp/Stawski Group CBRE Grand Central

This list includes leases with terms of more than two years. Deals are for new leases unless otherwise noted. 1-Renewal and expansion. 2-Renewal. 3-Sublease. 4-Expansion. 5-WPIX’s renewal at 220 E. 42nd St. is a long-term restructuring of the 104,243-square-foot renewalsigned in 2009. CoStar Group Inc., a provider of information services to the U.S. and U.K. commercial real estate industries, offers customers access via the Internet to the most comprehensive verified database of commercial real estate information in the United States and theUnited Kingdom. For more information, visit www.costar.com or call (877) 7-COSTAR.

R E P O R T R E A L E S T A T E

74,600

76,862

104,500

112,940 NY Metropolitan Transportation Council

Submarket

406,399


THE OP-Ed PAGE OnE-YEAr AnnivErsArY sPEciAl

The Real Estate Board of New York (REBNY) wants to congrat-ulate The Commercial Observer

on its first anniversary. The Commer-cial Observer has made a valuable contribution to the reporting of the real estate market and the real estate industry in New York City. This weekly publication has been a must-read for our members for its infor-mative and insightful arti-cles and columns.

In the spirit of firsts, though REBNY is the old-est real estate trade asso-ciation in New York, we are approaching the first anni-versary of the first woman chairman in our 114-year history, Mary Ann Tighe. In this inaugural year, REBNY continued its his-torical mission—working with the city and state to promote public policies that reduce the cost of doing business, that encourage new investment to grow our economy and that enhance New York City’s appeal

as a place where people want to live and work.

Over the past year, REBNY played a central role in two major issues af-fecting New York City: the proposed Sept. 11 terror trials in Lower Man-hattan and the push to restore and to

secure funding for a sta-tion on the No. 7 subway line extension.

When it was announced that the federal govern-ment would be holding the terror trials in Lower Manhattan, REBNY rec-ognized the negative im-pact it would have on the neighborhood, the country’s third-largest business district, and re-ceived numerous calls from members who were troubled by this decision. REBNY urged federal offi-

cials to move the trial to alternative locations in the Southern District, and encouraged state and city offi-cials to join in the effort.

REBNY’s effort included conver-

sations with numerous high-level of-ficials in the White House, including Secretary of Homeland Security Ja-net Napolitano, White House Deputy Chief of Staff James Messina and se-nior presidential adviser David Axel-rod. REBNY also launched a campaign on the REBNY Action Center Web site that enabled its members, businesses and residents in the impacted area and the public to contact their elected offi-cials urging them to move the trial.

As a result of REBNY’s efforts and the support of other organizations, the federal government is reconsid-ering Lower Manhattan as a location for the trials.

REBNY spearheaded an effort to restore the No. 7 Subway station at West 41st and 10th Avenue and to push for funding for its construction. This station is a crucial infrastruc-ture element in the successful com-mercial and residential development of the growing neighborhood on the far West Side.

Understanding the importance of building the station while construc-tion was already under way for the No.

7 subway line extension, REBNY en-couraged the city to apply for $3 mil-lion in TIGER (Transportation Invest-ment Generating Economic Recovery) II Grants, which could again make a station possible at this location. Efforts in the push for funding included a fact-finding trip to Washington, D.C., in May 2010, where REBNY representatives, along with City Council Speaker Chris-tine Quinn, met with the deputy chief of staff to Vice President Joe Biden. The city has applied for these funds, and, if granted, they would be used to change current design plans for the No. 7 line extension, enabling a station to be built in the future when sufficient funds be-come available. Without this redesign, it would have been physically impos-sible to construct the station once the construction of the No. 7 line extension is completed in 2013.

As our city and industry struggle with the continuing impacts of the recession, REBNY has been

taking action in Washington and in Al-bany to revive our economy. At the be-ginning of the summer, REBNY and its members, along with our colleagues at the Real Estate Roundtable, were successful in fighting the Carried In-terest proposal, which would have been devastating to the real estate industry and would have dramatical-ly increased barriers to development during our struggling recovery.

The Carried Interest proposal

would have increased the capital-gains tax rate for managing partners from 15 percent to 34.7 percent for holdings shorter than five years and to 29.6 percent for holdings longer than five years. In addition, the pro-visions would have been broadened to include interests held by family members of a managing partner to be taxed at the Carried Interest rates.

This has been the third time that such a change has been proposed. As the concerns in Washington grow about the federal deficit, we can ex-pect that another proposal to in-crease the Carried Interest tax rates will be introduced.

In Albany, REBNY has introduced 421a legislation that would revive stalled projects, spur new develop-ment and create housing that would be permanently affordable. These initiatives would serve as a catalyst for the economy by creating jobs and generating tax revenue, and would help to address the city’s shortage of affordable housing.

Over the next year, REBNY will continue to be an advocate for actions that are beneficial to our members and our industry. We look forward to the high-quality and objective re-porting of The Commercial Observer to complement our efforts and bring awareness to relevant issues.

Steven Spinola is president of the Real Estate Board of New York.

Industry advocate pushed against terror trials downtown, for No. 7 line station

rEBnY Had a Pretty Busy Year, Too

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The emergence from recession in the United States and Europe has been lackluster. A year after the first issue

of The Commercial Observer reached its select readership, headline measures of growth in the former show that the econo-my has slowed from its early, headier pace

of recovery. And while the

labor market has stanched the fright-ful job losses of late 2008 and early 2009, the American economic engine has yet to spur meaning-ful new job gains. Ba-sic questions about the nation we will be in the 21st centu-ry—embodied in the debates over health

care legislation and the extension of expir-ing tax cuts—cloud the business outlook and, until the opaque skies clear, hamper investment.

And so there is talk of the potential for a double dip that might erase the mod-est gains of the past year. Will it be slow

growth or no growth? Economists, with their meager macroeconomic forecasting tools, continue to debate how to compel a return to expansion. In Washington, the approaching election has turned many pol-iticians into economists in their own right. Worse yet, every economist is now an un-witting politician. Professors, be warned: Your academic assessment of the Bush tax cuts might also signal your views on free speech, gays in the military, the burning of sacred texts and your voting intentions in November.

I write this week’s column from the con-fines of a transpacific flight, making my way from the familiar surroundings and

quandaries of New York City for a week of speaking engagements and meetings along the Asian Pacific Rim. However hectic the upcoming week’s schedule, it offers an op-portunity to put our domestic mare’s nest into a larger context.

As it turns out, I am not the only one making an eastward sojourn. On the cover of The Wall Street Journal’s rather slight Asia edition, there is news of Governor Schwarzenegger’s weeklong trade mis-sion. Larry Summers, as well, was in the

A year into the recovery chatter, lessons to take away from the Far East

Notes From the Pacific

THE LEAD INDICATOR ANNIvERsARy sPECIAL

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And we’re looking forward toMore of The Commercial Observer

Happy First Anniversary!

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THE LEAD INDICATOR ANNIvERsARy spECIAL

For a complete archive of Sam Chan-dan’s Lead Indicator columns, go to Ob-

server.com/the-lead-indicator.

neighborhood just last week.There was a time, in the long days of the

Cold War and more than a decade following the Sino-Soviet split, when only Nixon could go to China. Now, almost 40 years after the late president’s historic meeting with Chairman Mao Zedong, the world’s attention —like the governor’s and former Treasury secretary’s—

is turning ever more eastward. The U.S. econo-my returned to some measure of growth a year ago, in the third quarter of 2009. But in order of magnitude, China has been at the helm of the global recovery.

In the United States, China’s growing prom-

inence on the economic, political and military stage is greeted with a balance of awe and con-sternation. Ongoing disputes over a host of is-sues, ranging from currency policy and a per-sistent trade imbalance to engagement with North Korea and controls on the export of rare earth metals, have fueled perceptions in the West that China will not acquiesce to our par-ticular rule book.

The currency question, in particular, has raised the ire of policy makers. The House Ways and Means Committee will convene on Wednesday and Thursday of this week to con-sider the issue. And if a hard line on China resonates with voters, we will certainly hear more on this issue from Congress as Election Day approaches. The testimony to watch will be that of Treasury Secretary Geithner, sched-uled for Thursday. The tenor of his comments will undoubtedly prefigure the administra-tion’s broader engagement strategy.

When thinking about our uncertain future, an acknowledgement of China’s current suc-cess can be instructive. If nothing else, it tells us that a highly controlled market economy can still experience rapid growth. I am cer-

tainly not suggesting that we should abandon our stronger and unequivocal embrace of free markets. I only concede that growth can occur under different models.

Given the near certainty of a more regulat-ed business and financial environment in the United States, it is worth observing that Chi-na’s most successful real estate market par-ticipants are those that have adapted to the wondrous complexity of its regulatory envi-ronment.

With that in mind, there is hope for us [email protected]

Sam Chandan, Ph.D., is global chief economist and executive vice president of Real Capital Analytics and an adjunct professor of real es-tate at Wharton.

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By Jotham SederStrom

over the past 12 months, The Commercial Observer has peeked into the boardrooms,

cramped offices and tightly sched-uled conference rooms of the city’s most influential real estate stars and those closing in on that shorthand. From the outspoken to the shy, and from the megalomaniacal to the self-effacing, here’s a look back at some of the high points of the past year, a representative sample, if you will, of Power Brokers.

the Cultivator

From Sept. 15, 2009Listening to Steve Durels ponder

the challenges of renovating a dis-tressed building, you could hardly be chided for mistaking the SL Green leasing director for an interior deco-rator.

“At the end of the day, this will be an exercise in correcting those things about the building that were done … imperfectly,” said Mr. Durels, rather artfully.

Out-of-place lobby chandeliers, dreary old windows, demolished floors and bathrooms in disrepair—it was no wonder the beleaguered of-fice tower to which he was referring has had such difficulty drawing ten-ants, Mr. Durels sighed.

The building in such need of re-suscitation is 100 Church Street, the 21-story tower SL Green ac-quired last month after the Sapir Organization defaulted on loan pay-ments to the real estate investment trust. Among real estate insiders, it’s one of the most closely watched properties in a portfolio of 30 New York City buildings currently

managed by SL Green, touted as the biggest owner of office buildings in Manhattan.

“I can tell you already we’ve got a half-dozen prospects who are look-ing at space for everything from 75,000 square feet to 250,000 square feet solely because of our involve-ment, and that’s after two weeks,” said Mr. Durels, who has made a ca-reer out of identifying distressed properties and determining how to refurbish them.

the elizabeth taylor of retail

From Dec. 1, 2009If there was ever doubt about her

pivotal role at Prudential Douglas Elliman, a real estate firm bubbling over with big names and bigger egos—think Dolly Lenz and Jacky Teplitzky, to name a couple—Faith Hope Consolo was all but declaring her position at the top of the pile on a recent rain-swept Monday after-noon.

“You know what, Hollywood has their stars, but

New York has real estate,

and every-body in real estate in New York thinks they’re a star,” said

Ms. Conso-lo, con-

firming a fact that exactly nobody in the industry hadn’t already fig-ured out. “Whether they are or they aren’t, this is our Hollywood.”

Depending on whom you ask, Ms. Consolo may, in fact, be the Elizabeth Taylor of the real estate set: brash but focused, prolific if a bit unhinged, with a client roster that includes upscale tenants with names like Versace, Salvatore Fer-ragamo, Yves Saint Laurent and Fen-di, to name a few. None of that is to say, however, that her critics would agree with the depiction.

“She’s a queen in her own mind,” sniffed one real estate insider, who criticized Ms. Consolo’s legendary self-promotion, a skill that, like it or not, has led to reality TV and book offers as well as myriad on-air ap-pearances.

the ambassador

From Jan. 5, 2010Say what you will about dicta-

torships—the human rights abuses, censorship and religious intoler-ance, for starters—they do make for truly fantastic tenants.

The unconventional wisdom is but one lesson real estate broker Gil Robinov has learned in a 40-year ca-reer that has put him in close prox-imity to monarchies and autocracies, from Egypt and Iran to Saudi Arabia and Uzbekistan—not to mention the dreaded North Korea.

Indeed, since 1992, when he snagged his first foreign client, Mr. Robinov has represented 25 percent of the 192 member governments of the U.N. In total, the native New Yorker has leased an estimated 30 million square feet of office space to Fortune 500 companies, major insti-tutions and, most notably, foreign governments.

“The word ‘trust’ is very impor-tant because, in general, the mem-

bers of the U.N., they don’t trust New Yorkers or fast-talking Ameri-cans, especially the brokers,” said Mr. Robinov, an executive managing director at NAI Global who has been nicknamed Mr. U.N. for the lengthy roster of governments he has helped to acquire space near the United Na-tions Plaza. “I’ve been told that the plumbers take advantage of them, the electricians take advantage of them, the telephone company, the furniture people—everyone’s over-charging them.

“They trust me, and that means a lot.”

the Puzzle Solver

From Feb. 23, 2010When it was announced last week

that the coveted Drake Hotel site had been sold for $305 million to the Cal-ifornia-based investment firm CIM Group, mum, apparently, was the di-rective.

But one day before word of the deal trickled down to The Wall Street Journal, the otherwise cool-as-a-cu-cumber Studley powerhouse Woody Heller was struggling to contain his glee over having brokered the deal on behalf of CIM. Indeed, reader, a faint smile seemed to cross his face while relaying the news to a report-er.

Combined with the Dec. 31 sale of 515 Madison Avenue—a deal that faced more than a dozen obstacles over two years of negotiations—Mr. Heller’s latest string of transactions has positioned the Studley executive managing director as a master at closing eyebrow-furrowing deals.

During his tenure at Studley, which began in 2003 and has includ-ed the complicated sale of notes and a mortgage at the Chrysler Building, Mr. Heller has closed more than $6.5 billion in asset and note-sales trans-actions, totaling an estimated 33

million feet, while also working out tough deals for hitters like Dai-ichi, Life Investment Properties, Vornado and SL Greene, among others.

“For some reason, complicated deals seem to find me,” said Mr. Hel-ler, 50. “It’s a good and a bad thing.”

the First one Into the Pool

From April 13, 2010Be it the meatpacking district,

where he inked one of the first deals as the area was shedding its dry skin as a bastion for butchers, or on Mul-berry Street, where he was the leas-ing agent for John Gotti’s former social club, which he turned into a boutique, Ben Fox has rested his reputation on an uncanny ability to spin gold from silk.

Indeed, at the age of 60, the Win-ick Realty president and longtime retail broker sniffs out emerging neighborhoods as well as, if not bet-

Sample the swagger! Our year in pointillist profiles

a taste of Power

Power Broker one-year annIverSary SPeCIal

Under the name Carid Associates, Mr. Em-den and brother Jeffrey posted ads in The New York Times, listing a phone num-ber that connected to a pay phone outside a Manhattan Blimpie location. They hung an ‘out of order’ sign on the phone and paid an employee at the sandwich shop $20 a month to make sure it never got tied up by custom-ers. —From a profile of Colliers International’s James Emden

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ter than, any broker currently working in the city, not to mention the youthful trailblazers he looks to for direction.

Mr. Fox has represented retailers as var-ied as Hard Rock Cafe, Starbucks, Dean & De-Luca, Ann Taylor and Equinox, ushering each of them into neighborhoods once thought undesirable but now considered chic. But among his accomplishments, Mr. Fox said the 180,000-foot deal he secured for the AMC Movie Theatres chain on West 42nd Street ranks among his proudest real estate mo-ments. In fact, it was the deal that turned Times Square into the family-friendly area it is today.

“We’re there way before it ever even shows up in The New York Times or The New York Observer or New York magazine,” said Mr. Fox. “We’re down there early and we’re street urchins to an extent. We’re always on the street, always looking, always exploring. A lot of us are looking for new markets.”

The Dean of Commercial Real Estate

From April 20, 2010When he isn’t reeling in 370-pound mako

sharks from his sport-fishing boat, Howard Kesseler, an executive managing director at Newmark Knight Frank, has been netting some of the biggest real estate deals in New York.

Indeed, with education and health care widely perceived as two growth sectors at a time when few industries are actually ex-panding, Mr. Kesseler’s expertise in bro-kering deals on behalf of private and public schools across the city has kept the New York native—he lives with his wife and son near the Upper East Side—sailing against the eco-nomic tide. Recent transactions involving the Rebecca School, the city’s Department of Ed-ucation and CUNY, among others, helped Mr. Kesseler earn a “Broker of the Year” award from Newmark in 2004, a win he repeated in 2005, 2008 and 2009.

But the deal that may have cemented Mr. Kesseler’s reputation as a veritable dean of real estate was a 203,770-square-foot lease on behalf of the Claremont Preparatory School, a tony private institution he expanded from nearby 41 Broad Street to 25 Broadway, just steps from the bronze charging-bull sculp-ture in Lower Manhattan. The deal, valued

at $150 million, was one of the largest in the city last year. It was sealed after a 12-month search that included visits to 100 Church Street, among other sites.

“I have this blue-ocean approach to my business,” said Mr. Kesseler. “About 70 per-cent of the brokers compete for the same business. They compete for the private-eq-uity business, the law firm business and the high-end private-sector business.

“And, to me, that’s like fishing in a fleet of 100 boats. I’d much rather fish in a fleet of four boats.”

The Heat Seeker

From April 27, 2010Ken Siegel is a broker with a knack for

complicated deals and an unyielding loyal-ty for Jones Lang LaSalle and its predeces-sor, LaSalle Partners, one that has lasted for 23 years and counting. It’s no wonder that, during an interview in April, he proclaimed, “I grew up at this firm, so I admit I bleed JLL blood.”

With help from headline-grabbing clients like the law firm Loeb & Loeb, Bank of Amer-ica and the daytime television news show Good Morning America, Mr. Siegel has earned his reputation as a master puzzle solver.

“If I think about my niche in this market-place, I would describe it as ‘Give me the tough ones,’ the kind of intricate, complex, strategy-oriented, large, maybe even head-quarters-type transactions,” he said. “That’s where I find my skill set can really add val-ue.”

With the Good Morning America deal in particular, Mr. Siegel succeeded in prepar-ing a complex transaction for Disney at 1500 Broadway in less than two weeks. No easy deal, it required an agreement for a complete and total structural renovation of what was previously a multilevel movie theater.

“It was as quick a deal as you would have ever seen,” said Mr. Siegel of the lease at the New Amsterdam Theater. “It had bumps in the road, but we did it in record time.”

The Very Frequent Flier

From May 4, 2010Hurl a dart at a map, and chances are wher-

ever it lands, Mitti Liebersohn, a Cushman & Wakefield vice chairman, has inked a high-

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profile deal.Indeed, the charismatic frequent flier esti-

mated last week that he currently has 500,000 square feet in commercial real estate transac-tions pending in San Francisco, Chicago, Dal-las and Miami, among other far-away U.S. lo-cales he’s visited since the beginning of the year.

But with leasing activity increasing dra-matically from the first quarter of 2009, Mr. Liebersohn, who typically inks between 150 and 200 deals a year, anticipates even more time in the friendly skies, thanks in part to a handful of pending deals. Since last summer, Mr. Liebersohn has tallied nearly 1 million square feet, both in New York and globally, and the activity isn’t expected to slow down.

Most conspicuous of his recent deals may be a well-publicized 415,000-square-foot renewal on behalf of long-held client New York Life Insurance Co. Inked in December, the deal at 63 Madison Avenue is believed to have been the second largest of 2009. Weeks later, Mr. Liebersohn tallied another deal for the insurance company when he inked a 200,000-square-foot lease in Mexico City for what will become the group’s Latin American headquarters, he said.

“I love traveling around the country, I love being in touch with what’s going on in all the markets and, to me, it’s just so much more in-teresting,” said Mr. Liebersohn.

The Re-Enrolled Old-Schooler

From June 22, 2010Before embarking on his 35-year relation-

ship with Edward Gordon, the newly appoint-ed Colliers International vice chairman James Emden was a rental apartment agent with neither a phone nor an office. Freshly gradu-ated from Ohio State University, the Long Is-land–raised ingénue set out to raise funds by renting apartments in Gramercy Park.

Under the name Carid Associates, Mr. Em-den and brother Jeffrey posted ads in The New York Times, listing a phone number that con-nected to a pay phone outside a Manhattan Blimpie location. They hung an “out of order” sign on the phone and paid an employee at the sandwich shop $20 a month to make sure it never got tied up by customers.

Despite his ramshackle strategy, the busi-ness paid off and, by the time he bid adieu to the rental market, Mr. Emden had pocketed a

cool $20,000.“I had about $10,000 in school loans, and

then the market collapsed in New York, so there were tons of apartments and you no longer needed to pay a fee to a broker,” said Mr. Emden of what ended his brief residential stint in the early 1970s, which saw him stand-ing next to the “out of order” pay phone for hours a day. “In those days, if you rented an apartment for $300, the fee would be around 10 or 12 percent.”

The Phraseologist

From July 12, 2010Although not raised as an orthodox Jew,

Gary Eisenberg, a partner at Herrick Fein-stein, whose clients have included Lehman Brothers and the investor J.E. Robert, said he became observant later on in life after be-coming convinced, while studying math and economics at Yale, that the religion itself was slowly evaporating.

Should you presume, however, that Mr. Eisenberg’s propensity for legal and financial

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Cpower broker AnniversAry speciAljargon, his accountant’s mind for precision, or his late-in-life devotion to Judaism has turned him into a soporific stick in the mud, think again, reader.

A sports fanatic who boasts the ability to recite, in order, each goal scored in every World Cup final ever played, Mr. Eisenberg published the encyclopedia-like The Games That Rate in 2001. Using six criteria as a guideline, the book lists the most cataclys-mic moments in the annals of team sports, from the so-called “Miracle on Ice” Olympics hockey match in 1980 to Brandi Chastain’s medal-grabbing penalty kick against China during the shocking 1999 Women’s World Cup final.

“You don’t necessarily know in advance of the resolution of a legal dispute how it’s go-ing to play out,” said Mr. Eisenberg, by way of binding his twin loves of real estate law and sports. “You can try to predict their actions, you can try to anticipate their reactions and you can try to discern what they might do ra-tionally or irrationally.

“But just like any major sporting event, it’s possible for one team to upset another because you’ll never know the results for sure. That’s why they play the game.”

The interpreter

From Aug. 17, 2010Since 2006, the silver-haired Greg Kraut

has dropped his knees into the steady tide of foreign companies now seeking to ex-pand in New York. Unlike the global con-glomerates like Honda and Cadbury that fill business pages worldwide, the firms he has aligned himself with as a first vice president at CB Richard Ellis count themselves among a small but growing breed: South and East Asian companies just now beginning to plant seeds in the New York metro soil.

Since he first took notice a few years ago of an uptick in international firms dropping an-chor in New York, Mr. Kraut has inked deals with CICC, one of China’s largest investment banks; the Japanese government; and Clyde and Company, a London-based law firm that last week inked a 17,000-foot expansion deal at its offices at 405 Lexington Avenue for a grand total of 35,000 square feet. He’s also currently working on behalf of a Chinese so-lar energy firm and several Indian firms.

“I’m always looking for the next big thing,” said Mr. Kraut, a voracious reader who counts most major city newspapers as well as China Daily and a bevy of trade mag-azines as required daily reading. “And what I was seeing right before this recession hit was a sprinkling of Chinese firms and Indian

firms starting to set up shop here. “And I thought to myself: This is going to

be the wave of the future. So I decided to re-ally get out in front of it right away.”

The broker who would Fill one world Trade

From Sept. 7, 2010Tara Stacom and her team at Cushman &

Wakefield became involved with One World Trade Center in 2007, after an earlier leas-ing assignment at 20 Times Square above the Port Authority of New York and New Jer-sey’s bus terminal. As she describes it, how-ever, the account with what will be the tall-est skyscraper in the Western Hemisphere did not come without a struggle, as competi-tion was fierce.

“Everyone in the industry responded,” recalled Ms. Stacom, a vice chairwoman at Cushman, where she has worked since 1981. “It was really quite significant. It was more than a handful—it was between one and two handfuls.”

Where a typical agency pitch before a de-veloper may stretch to more than an hour in length, the huge response to the One World Trade Center RFP forced officials to shorten meetings to around 35 minutes, said Ms. Sta-com. Nonetheless, Cushman distinguished itself with its marketing approach, the com-position of its leasing team and its view of the building as a global draw.

“Our approach was definitely global,” said Ms. Stacom. “We felt this would be the most important building in the United States in the most important city in the United States, and it needed to be a global icon in the world. Others came at it as more of a New York icon and more symbolic for New York. Our ap-proach definitely differentiated us.”

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Want all the Power Broker profiles of the past year?

Go to Observer.com/PowerBroker.


THE LOBBY

BY JOTHam SEdErSTrOm

CBrE’s New King of americas

Michael Lafitte has been named presi-dent of Americas Business for CB Rich-ard Ellis, a position that he will oversee

from his native Dallas. Mr. Lafitte, 48, was previously president

of CBRE’s Institutional & Global Corporate Services, where he helped increase profits by $1.7 billion.

In his new role, Mr. Lafitte will oversee business lines in the United States, Canada and Latin America, which, with 1.3 billion square feet of property and $3.2 billion in rev-enues last year, is CBRE’s largest segment.

“It’s a tremendous change from my last position,” said Mr. Lafitte by phone from his Dallas office.

Mr. Lafitte, who was hired at CBRE in De-cember 2006, previously worked as a leasing agent at Lincoln Property Company and, later on, as a leader at the Bear Stearns Real Estate Group. He joined CBRE when the company acquired Trammell Crow Company, where the married father of three served as a director of global services.

The outgoing Americas president, Calvin Frese Jr., meanwhile, has been named CBRE’s global chief operating officer. “Mike is the per-fect person to lead our Americas operation to the next level of success,” Mr. Frese said in a statement. “He is widely respected by our em-ployees and clients alike and is a great leader who lives out our corporate values.

Colliers Position to Capitalize on down market

Eric Mockler has been named senior man-agement director at real estate services firm Colliers ABR, effectively putting him

at the helm of 11 million square feet of prop-erty in Manhattan, Westchester County and Connecticut.

Mr. Mockler, 47, previously worked at John-son Controls Inc., where he served as general manager for Real Estate Services–Americas Division.

“Our objective is to be the best,” said Mr. Mockler, the father of 7-year-old twins. “The biggest will come, but our initial priority is to be a high-quality provider of real estate services.”

The position, which will include managing clients’ assets and adding value to distressed properties, is newly created for Mr. Mockler, who said he was tapped, in part, to capitalize on the down market.

“We think it’s a unique time in the market-place for change because people are looking to optimize their revenue streams, and the better a building is can make a big difference when you’re trying to retain and attract busi-ness,” said Mr. Mockler, whose portfolio in-cludes 250 Park Avenue and 277 Park Avenue, among other high-profile trophy properties.

also Notable …

Maureen Ehrenberg, an Illinois native, has been tapped to join CB Richard Ellis’ Glob-al Corporate Services organization as a senior consultant. Ms. Ehrenberg, who will be based in the company’s Chicago office, will assist CBRE clients with cost cutting and operation-al improvements.

Previously, Ms. Ehrenberg led the Global Client Services business for Grubb & Ellis, a role that included providing corporate ser-vices, project management and consulting services.

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real estate titans come in all shapes and sizes, demeanors and personalities. Over the past 12 months, however, The Com-

mercial Observer has learned firsthand that they all share a visionary streak—and a pro-pensity to gab.

Here, below, are just a few examples over the last year of what was said when we stomped into Big Real Estate’s C-suites.

the Cousins durst

From Sept. 15, 2009The Durst Organization, one of the city’s

oldest family-run real estate developers, is in a state of transition. Co-president and chair-

man Douglas Durst, 64, who took the reins from his father, Seymour Durst, in 1995, in-tends to cede his presidency to cousin and 53-year-old co-president Jody Durst later this year. The two co-presidents sat down with The Commercial Observer to talk about the transition.

What have you been up to since stepping down as co-president?

Douglas Durst: I’m starting to step away and attend less meetings and come in a little later, and that’s been terrific. My father taught me that you go for cocktails and then you have somebody say, ‘I just saw him over there,’ and then you sneak out. That hasn’t changed.

Do you expect to have more free time?DD: I certainly hope so. People ask me

that and I don’t think that’s much of an issue. There’s lots of things I like to do, and certainly I have a whole stack of books I’m looking for-ward to reading. I have my bicycle that’s miss-ing me.

What added responsibilities will you have, Jody?

Jody Durst: Just being more discriminating with my time because there’s more to do.

And how has that been going?DD: Last night we had a brokers’ party, and

he had to stay for the whole thing.JD: Douglas’ typical philosophy is the soon-

er you show up, the sooner you can leave. I told him the other evening that I was surprised to still be seeing him.

a Sport of It

From Oct. 6, 2009Since Peter Riguardi joined Jones Lang

LaSalle as the president of New York opera-tions in 2002, his responsibilities have grown significantly, both in terms of personnel and the number of real estate transactions com-pleted. The Commercial Observer spoke to Mr. Riguardi in his sports-memorabilia-bedecked

office and learned not only about the inner workings of JLL, but the lifelong New Yorker’s devotion to sports and how, exactly, they tie into his role as a real estate chief.

I notice you’re a football fan. Have you met former Cowboys quarterback Roger Staubach, whose company merged with JLL in 2008?

I’ve actually had the pleasure of developing a very nice relationship with Roger. It’s been one of the real benefits for me in the merger. Not only because—yeah, I’m a football

fan and I grew up on Sundays watching Rog-er pump-fake and beat the Giants—but more importantly, today, who Roger is and what he stands for: his standards, his ethics, his com-mitment to clients.

In Queensland, Australia, Jones Lang La-Salle has a company rugby team, which re-cently beat competitor CBRE. Do you play organized sports here?

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Grows Leases

Jody and Douglas Durst on Leasing and Lending in the DownturnBy Jotham SeDerStrom

Nonprofit Leasing reaps the Great

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TALF, Smalf! The Industry Needs

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ric Clark on Brookfield’s war Chest, Lower Manhattan and Putting $1 B. in Debt to BedBy JoThAM SeDerSTroM

View From the Center

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Kings of Leasing

Power BroKer Cushman’s August Direnzo Goes Back

Stephen Siegel, Scott Gottlieb and Michael Laginestra of CB richard ellisBy DAnA ruBinStein

reBny Chair Stephen ross

on Seizing recession

LeASe BeAt 31 west 52nd Street101 west 57th Street

78 Greene Street


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the commercial observer

THE siT-down onE-YEar annivErsarY spEcial

We used to play softball in Cen-tral Park. On Mondays, I think it was. I forget the day. But you would play all the teams, and the games were very competitive. A lot of the guys are still around and we still laugh about those days. And, yeah, you know what? Luckily it was softball and not hardball because you didn’t want anyone throwing it under your chin.

How’d you do against CB Rich-ard Ellis?

CBRE back then was a smaller player, but the roots of CBRE, like their brokerage business—well, their softball team was a tough com-petitor. Let’s just say that.

Madame chair

From Jan. 19, 2010In January, CB Richard Ellis chief

executive officer Mary Ann Tighe of-ficially slipped into the chairman-ship of the Real Estate Board of New York. The Commercial Observer spoke to Ms. Tighe about her role in revitalizing the city and her most en-during achievements.

You were hailed by the New York Post as one of the most influ-ential women in New York. Do you agree with the statement?

If it means having the ability to get things done—that you can en-vision something and get it done—then I’d like to think yes, that that’s the case. There are a few things I’ve managed to get done that make me feel like I can have some impact on our city.

Can you name one of them?I think you can look at two towers

that are standing that I don’t think anybody would’ve bet on. The Con-dé Nast tower at Four Times Square,

which was the first new construc-tion in a decade and the first build-ing at Times Square. As you proba-bly know, it was a project that was held up for more than two decades. And then, of course, there was the New York Times building at a site I don’t think most people thought was coming into development soon.

You were honored with a ‘Life-time Achievement’ award by REB-NY at its award ceremony. A little weird, right?

You know, I suddenly thought to myself, ‘Oh my! Am I that old?’ On the other hand, that night was so fun. I always joke that 25 years ago, I was so intimidated by the event, and now it seems like I’m going to a family wedding. I mean, it has that kind of festive feeling for me, so the award just added to that.

The long view

From Feb. 23, 2010Since 2005, Bruce Mosler has

been at the helm of Cushman & Wakefield as the real estate services firm’s president and chief executive. But on March 22, the 52-year-old will turn over the reins to outgoing Centro Properties Group CEO Glenn Rufrano. Mr. Mosler spoke with The Commercial Observer about his new role as co-chairman of the firm.

Will you have more time on your hands?

I certainly will have more time to devote to business development, which is what this was all about. At the end of the day, this was a move to get me to client interface, to de-velop, for lack of a better way to ar-ticulate it, a key client care program so that I can help mature some of the large institutional relationships and cross-sell them into other ser-vices; and, most importantly for me, to make a difference right here in the Northeast region and, particularly, in New York in securing large-end portfolio businesses.

In a way, you’re going back to your roots, aren’t you?

It’s getting back to my passion

and my beginnings in the sense that, as any former broker, I built my rep-utation on how we service the client and the ability to proactively secure business. There’s an element of that.

punching above His weight

From April 20, 2010Since coming to America from his

native Greece in 1971, Heritage Realty Services president George Constan-tin has risen from being a broker at Helmsley-Spear to running his own bustling boutique realty firm. With only eight full-time employees, Mr. Constantin has managed to turn the five-year-old concern into a competi-tor that can react quickly to changing markets in a way that many cannot.

Congratulations on the five-year anniversary of Heritage Re-alty Services.

I’ve never worked so hard in my entire life. I’ll be quite honest with you. There are a lot of opportuni-ties—and the pleasure of having your own company. You can give it direction, any direction you want. Wherever you see a void, you can fill it quickly and not have to go through the regular corporate bureaucracies you have in the bigger firms. At the end of the day, I approve everything. I don’t have to go to anybody higher. We can make instant decisions. At the end of the day, when all is said

‘I think it’s a help in anything you do. You’re not going to be able to print what I say, but when I put my teeth in some-body’s tush, I hang on. I don’t let go—sometimes to a fault.’

—Norman Sturner


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Jones lang laSalle Prez Peter riguardi on Big Deals in Black rock, GM Building—and

Brokerage Softball Back in the DayBy JothaM SeDerStroM

a real estate Sport

Power BrokerCaroline Pardo,

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Studley’s Mitchell Steir and Michael Colacino Don’t weep for the landlords. Plus: ask them about China!By Dana ruBinStein

tenant rep titans

The SiT-DownRelated Companies’

Bruce Beal Jr. ❯

Real estateheaviesGo Long

eliot Spitzer’s Garage Sale;Joseph Chetrit’s

Land Swap

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newmark Knight Frank’s Mark weiss on Big Leases

and Big egos By JoThAM SeDeRSTRoM

Giant Killer

By LySAnDRA ohRSTRoM

“New York has always rebounded, and I am a staunch believer in the resiliency of our great city,” said Stephen Ross, chairman and CEO of Related Com-panies and the chairman of the Real Estate Board of New York. Mr. Ross made his comments shortly after par-ticipating on a panel at an Oct. 6 con-ference, hosted by The New York Ob-server, that focused on the commercial industry coming out of the recession.

(Continued on page 10)



and done, that’s important.

How does that benefit Heritage or, in general, any small, nimble boutique?

When deals are far and few, it helps us make an instant decision. So if we like something, we go after it—whether it’s a tenant or a build-ing to buy. We’re looking at a prop-erty now in midtown, another one to buy, on one of the major avenues. That’s going to be about $100 mil-lion. There isn’t a committee or any-thing. It simply meets our criteria, so we’re going ahead with it. We buy two a year.

Flying High

From April 13, 2010

When it was announced last month that Brause Real-ty had inked a

city-backed sublease deal with New York–based JetBlue, nobody was more thrilled than David Brause, the president of the 83-year-old fami-ly-owned realty company. Besides filling vacant space at the Brewster building in Long Island City, Mr. Brause, 39, also played a small role in the city’s bid to retain some 900 airline jobs that would have other-wise flown to Florida.

Tell me about your pitch to Jet-Blue?

We brought them over on the Wa-ter Taxi from Manhattan to Queens on a great beautiful summer day. We were the last neighborhood that they were touring in the day, so we had a beautiful sunset over Manhat-tan, and the views of Manhattan are actually not great in Manhattan, but they’re phenomenal in Long Island City.

You pulled out all the stops, didn’t you?

Oh yeah, we did a whole market-ing presentation, the aerial view from the top of the beautiful build-ing, showing where we were in terms of Court Square, Queens Plaza, Jack-son Avenue, where the BID was and where the Economic Development activities had been in terms of the $80 million that was being expend-ed on the park. MetLife got involved. Silver Cup Studios got involved.

After they did a tour of the UN Federal Credit building, they took a jitney to Silver Cup Studios. It was the night after the Emmy Awards, and 30 Rock had won the best com-

edy award, so we brought them to the 30 Rock stage and they got to see some of the sets and some of the ac-tors, which was exciting. And after that, they went out for drinks in Long Island City and had a great evening. I think that kind of began the courting of JetBlue to Long Island City.

Home runs

From April 27, 2010All eyes seem to be on 200 Fifth

Avenue, the former Toy Building and, as of last month, the new home to star chef Mario Batali’s highly an-ticipated food emporium Eataly and Tiffany & Co. At the root of all the excitement is David Levinson, the chairman and CEO of L&L Holdings, the privately held real estate invest-ment concern he formed with Rob-ert Lapidus in 2000.

How did the Eataly deal take shape?

They were in the market for a while, looking to develop something in New York along the lines of what their financial partner had developed in Turin and Japan. They had an Ital-ian connection, an operator that was there, and somewhere along the line they hooked up with Mario Joe Bati-anichCK to be the operator.

We had a lot of people looking at that retail space. A lot of them were event operations, because that was there; we had Cipriani 23. There were a lot of catering operations, and all the catering operations came to us and wanted that location, but

that’s not really what we wanted. We actually had a vision to animate the space, and we wanted some kind of restaurant. It was really quite amaz-ing how this worked out because we actually had a vision very similar to what Eataly is.

The History Buffer

From May 4, 2010Veronica Mainetti, the 31-year-

old head of U.S. operations for the Sorgente Group, has had a whirl-wind year, not least of all because of a well-publicized investment in the Flatiron Building in 2009. Since put-ting 34 Greene Street and its seven elegant Soho condos on the market in January, Ms. Mainetti has been engaged in selling the residential units while also representing her fa-ther’s real estate empire stateside.

Did you anticipate that there would be so many Europeans in-terested in 34 Greene Street?

Yes, because of where the euro was. Plus, Europeans love Soho and cast-iron buildings and lofts. If you go to Europe now, the new ground-up development, the layouts of the space is mainly lofts, and the lofts originated here in the ’50s when the industrial part of New York moved out into the outer boroughs.

Are you seeing a shift, with more Americans showing interest in 34 Greene Street?

Yes, but really it’s how the euro moves, or the dollar. That has a big effect.

You appear to be very hands-on. At this point, how do you stay busy at 34 Greene?


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Bloomberg’s Third Term

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Cushman & wakefield’s Dale Schlather Among the Busier Brokers Going into next Year

BY JoThAm SeDeRSTRom

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Malkin holdings’ Fred Posniak on Leasing at the higher end

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imperial Vu



It being finished, there’s just lit-tle things that I see, and it’s proba-bly only things I see. I’m just trying to better things constantly—I guess, just making sure that, after the par-ties, after the showings, that things are still perfect.

a new chief pauses

From June 22, 2010In April, former Centro Proper-

ties chief executive Glenn Rufrano took the reins as Cushman & Wake-field’s CEO. In the two months since, the 60-year-old real estate veteran has embarked on a global fact-find-ing mission that has included visits to the firm’s offices in Europe, Asia, Canada and the United States.

Congratulations are in order. How have you been spending your first two months as chief execu-tive officer at Cushman?

What I did at first was try to un-

derstand the depth of this organiza-tion from a geographic standpoint. So of the roughly nine weeks, I’ve been on the road five. I’ve traveled through Asia, I’ve been to London, I have to get to some other places in Europe. I’ve been through South America, up to Canada, and from the East Coast to the West Coast in the United States. I haven’t hit every-thing I’d like to hit, but this is real es-tate, and if you’re a principal in real estate, you have to get out and kick the bricks.

Have you identified anywhere that Cushman can be improved?

I am still fact-finding, but the an-swer has to be yes. Any company that has come out of 2008 and 2009, and is alive—and Cushman is alive and we don’t have any debt problems—now needs to reevaluate itself and determine how it’s going to focus its value over the next three to five years. There isn’t a company in the world that isn’t going through that thought process right now.

norman sturner rages against the dying of the light

From July 27, 2010Along with Neil

Siderow, Murray Hill Properties co-found-er Norman Sturner has weathered nearly 40 years in the real

estate industry, both during its ups and downs. By focusing on Man-hattan properties and creating four high-net-worth real estate funds, the 69-year-old mogul has come out on top.

In the past couple of years, Murray Hill Properties has grown in prominence. What do you attri-bute that heightened visibility to?

After 40 years, I’m an adult. Neil and I built this business in 1971, and it’s taken 40 years. About six years ago, we started several high-net-worth individual funds, and that al-lowed us to buy what you see up there on the wall. Up to that point, we were doing either one-offs or limited partnerships with individu-als. You can only get so big by using a single property with single inves-tors where, in contrast, once you get to starting a fund—and we’re now running $265 million worth of high-net-worth individual funds—you re-ally take off.

You’ve attributed much of your success to your own ‘stick-to-it-iveness,’ a phrase you might as well have coined. Has that ability helped you during the recession?

I think it’s a help in any-thing you do. You’re not go-ing to be able to print what I say, but when I put my teeth in somebody’s tush, I hang on. I don’t let go—some-times to a fault. But I think ‘stick-to-it-iveness’ and the ability to keep your focus on what it is that you want is extremely important, and it doesn’t matter whether

you’re a broker, an invest-ment sales owner, a prop-erty owner or anyone. If you think you’re right, do it. Don’t let go. Do not go quietly into the night.

Jonathan Miller appraises the commercial Market

From Aug. 9, 2010In 2005, Jonathan Miller made a

prediction on CNBC that, due to what he saw as a growing endemic within the mortgage industry, a downturn was on the way. Three years later, after the economy nose-dived, the cable news network reran the clip—this time in a segment looking back on the experts who got it right. He made another bold prediction dur-ing a conversation with The Com-mercial Observer.

What trends are you seeing in the commercial real estate mar-ket?

I think what you’re seeing, be-sides a whole lot of extend and pre-tend, is investors looking to acquire assets far less expensive than a few years ago and then turning the prop-erty around. What we’re seeing now is another bubble—rising rapidly.

A bubble?I would call it a bubble; and I’m

not talking about individual unit purchases. I’m talking about pric-

es being paid on distressed real es-tate snatched up from a developer in trouble. It’s interesting because after Lehman, which I see as the tip-ping point, there was little activity. The hedge funds and the groups that were forming distressed-asset strat-egies went out in 2009 to raise capi-tal to prepare for the onslaught of acquiring all the distressed property that was going to become available. And over 2009 and the early part of 2010, there was very little activity. It was very quiet.

And I think at some point a few months ago, with all the positive news we saw in the U.S. housing market, you started to see every-body coming out at the same time, competing for the small amount of property out there. As a result, it ap-pears that a lot of this property is be-ing snatched up above what the re-purposing of the property will yield. In other words, you may win the property, but the consumer’s situa-tion hasn’t changed.

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BY Dana ruBinstein anD tom acitelli

throughout the past 12 months, The Commercial Observer re-ported on tenants actively

looking for new space, regardless of whether those tenants (or their bro-kers, or their landlords) wanted the marketplace at large to know. Infor-mation is power! And so forth …

Here are some of the prospective tenants we reported on, including retail and office, and what happened to them. They were selected at ran-dom from our archives (which you can find in total at Observer.com/Prospective-Tenants), and we think we did pretty damn good.

We reported, you decided.

On Sept. 15, 2009, we reported …

Booze Giant Diageo Wants 50K Feet

Diageo, the London-based maker of all spirits Smirnoff, Johnnie Walk-

er, Guinness, Baileys, Cuervo, Tanqueray, J&B and Captain Morgan—and a firm that has human nature’s self-medicating tendencies to thank for its abil-ity to weather the recession with relative aplomb—is scouring the Manhattan of-fice market for new digs.

(For what it’s worth: Ac-cording to the firm’s Web site, “The word Diageo comes from the Latin for day (dia) and the Greek for world (geo). We take this to mean every day, every-where, people celebrate with our brands.”)

Diageo’s real estate con-sultant, the Tampa-based CLW Real Estate, is work-ing with Newmark Knight Frank principal and exec-utive vice president Scott Klau to find about 50,000 square feet of Manhat-tan office space. The firm’s sublease from Time Inc.

for similarly sized offices at 530 Fifth Avenue expires in Au-gust 2010.

Diageo signed its existing five-year sublease in order

to give its marketing team a foothold in New York City

(the firm’s U.S. operations are based in Connecticut). Now that said foothold is secure, the firm wants to explore its housing op-tions in what is undeni-ably a tenant’s market.

Mr. Klau wouldn’t comment for this story. But sources say the firm is looking pri-marily in the vicinity of Grand Central Ter-minal.

Afterword: In June 2010, Diageo North America leased 56,156 square feet at 530 Fifth Avenue, taking the entire fourth floor and part of the third for five years.

On Sept. 29, 2009, we reported …

reader’s Digest Wants 100K Feet

Reader’s Digest, which recently filed for Chapter 11 bankruptcy pro-tection, has hired Cushman & Wake-field to find about 100,000 square feet of new office space, according to industry sources.

The media conglomerate, which publishes 94 maga-zines worldwide, includ-ing the eponymous Read-

er’s Digest, has offices “all over the place,” as one source put it. “All over the place” includes offices in Chap-paqua and Westchester, as well as more than 70,000 square feet at the Sapirs’ 260 Madison Avenue and an-other almost 20,000 square feet at SL Green’s 16 East 34th Street, the latter reportedly home to Every Day With Rachael Ray.

It’s unclear at this point what, precisely, Reader’s Digest’s

intentions are. The firm filed f o r bankruptcy on

Aug. 24, w h i c h

How we did reporting on year’s most notable retail and office leases— before they happened

Prospective tenants: the scorecard


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“A full commission will be paid to the procuring broker who (i) consummates a sale, but only if, as and when title passes, or (ii) consummates a lease or sublease which has been executed by both the landlord and tenant, approved as required, and duly consented by the overlandlord in the event of a sublease. This writing does not constitute, and shall not be construed as, an employment; and no commission shall be deemed earned, due or payable unless and until a sale, lease or sublease (as the case may be) is fully consummated. Although all information furnished regarding property for sale, rental or financing is from sources deemed reliable, such information has not been verified, and no ex-press representation is made nor is any to be implied as to the accuracy thereof, and it is submitted subject to errors, omissions, change of price, rental or other conditions, prior sale, lease or financing, or withdrawal without notice.”

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Space For rent

Power Brokerrichard Farley,

Life Inside The Trophy Case ❯ ❯

roBerT knakaL on new York’s

Investment-Sales Trends

reTaIL LeaSe BeaT 75 orchard Street ❯ ❯

Chelsea MarketThe High Line

RETAIL SPECIAL REPORT

retail’s Challenge— and Promise

PageS 10-20

The Power BrokerThe education

of Greg wang ❯ ❯

Sheldon Solow Beats New York

Big-Time

LeASe BeAT 1095 Sixth AvenueTime-Life Building200 Park Avenue ❯ ❯

December 22-29, 2009 The Weekly NeWspaper of NeW york’s CommerCial real esTaTe iNdusTry $5.00

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Turn out the Lights’09 Finally over —welcome, ’10!

➤ The 216 Biggest Spaces on the Market ➤ The Top Prospective Tenants➤ The Largest CMBS Loans Maturing➤ Scott A. Singer on the New Financing ➤ Sam Chandan: Finding Green Shoots ➤ And robert knakal’s holiday wish List!

‘Disneyfied’Times Square Nears

Disney Store Deal

Sam Chandan On the Economics of

’10 Office Leasing

LEASE BEAT 446 West 14th Street

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Robert K. Futterman Talks ICSC, Holiday Shopping and

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ReflectionsOn Retail


means that Reader’s Di-gest can now terminate its lease obligations (oh, the glories of Chapter 11).

That said, the firm’s lease at 260 Madison (pictured) reportedly ex-pires in 2012. So even if it hadn’t filed for Chapter 11, it might still be look-ing for space in a market that has swung dramati-cally in favor of tenants.

Cushman & Wakefield’s Mitchell Konsker, who is working with Read-er’s Digest, declined to comment for this story. William Adler, a Reader’s Digest spokesman, would say only that “we are looking at various op-tions for meeting our space needs and haven’t made a final decision.”

Afterword: Reader’s Digest’s edi-torial staff moved late last year into the old Condé Nast space at 750 Third Avenue, according to the New York Post.

On Oct. 6, 2009, we reported …

WNET Looks to Go Dark at 450 West 33rd Street

Channel 13 has hired a broker to dispose of its cavernous offices on the far West Side, and to find it new offices that measure roughly half the size of the old ones.

Right now, Channel 13, also known as WNET, produces public TV like Worldfocus and Bill Moyers Journal in its 200,000-square-foot studios and offices within the 1.6 million–square–foot media megalopolis at 450 West 33rd Street, the building that Broadway Partners bought for an astonishing $664 million in 2007. (The now struggling Broadway Part-ners later tried to unload the build-ing, to no avail.)

The eyesore of a structure is also home to the Daily News, the Associ-ated Press, and U.S. News & World Report.

To implement its real estate strat-egy, WNET has hired Studley’s kind-ly executive vice president, Ira Schu-man, who is marketing the 200,000 square feet at an asking rent in the mid-$30s per square foot, and searching for new offices of about 100,000 square feet in size.

Why the new real estate strate-gy?

“With the economic downturn,

they have less people, so, a, they need less space,” Mr. Schuman said. “B, there have been some technological chang-es at WNET, and they need different studios. As a matter of fact, they just established a new [about 5,000-square-foot] studio in Lincoln Center. That gives them some capacity that they don’t need to have at

33rd Street.”“And, c, the space is now more

than 10 years old, and they would now like to upgrade it.”

WNET’s existing lease expires in 2018. Mr. Schuman said that WNET is open to dividing the space.

“If the right deal presents itself to lease half the space, we will do that,” Mr. Schuman said. “If the right deal presents itself to lease all of the space, we will be just as happy to do that, because that gives us the op-portunity to start all over again.”

Afterword: In August 2010, WNET signed a 95,000-square-foot lease in Worldwide Plaza.

On Nov. 3, 2009, we reported …

Does This Storefront Make Me Look Fat?

In the age of designer jeans, it’s hard to get excited about Levi’s, maker of sensibly crafted and mod-

erately priced denim wear that ap-peals to your mother.

But in this, the age of the frugal shopper, Levi’s is apparently sens-ing an opportunity. The clothier is said to be working with PBS Real Es-tate’s Laura Pomerantz to find new storefronts in Manhattan in which to hawk its 501 Boyfriends, its Low Skinny 531s and the like.

Ms. Pomerantz did not respond by press time, but a retail broker told us the firm is hotly pursuing a space on 14th Street in the meatpacking district.

“I can tell you that our focus on potential retail expansion this year has been on being opportunistic in the midst of the economic down-turn,” said Jeff Beckman, a Levi’s spokesman. “We have not set any

specific store expansion numbers, but are open to opportunities to se-cure prime space in outstanding lo-cations.”

Right now, Levi’s has four stores in New York City: 1501 Broadway in Times Square; 25 West 14th Street, between Fifth and Sixth avenues; 536 Broadway in Soho; and 750 Lexing-ton Avenue, near 59th Street. Levi’s also recently signed a lease on West 34th Street, near Herald Square.

Afterword: Levi’s reached a deal in February 2010 to open its fifth New York spot, a two-level store at 414 West 14th Street in trendy MePa.

On Nov. 23, 2009, we reported …

Exactly What They Want

Tiffany & Co., the retailer whose flagship store, packed as it is with precious metals and rare stones, ex-erts a seemingly magnetic pull on both Fifth Avenue tourist swarms and men seeking to please their bau-ble-headed brides, is looking for new office space.

The firm is working with brokers at Studley to find more than 200,000 square feet of office space, according to an industry source. We imagine there are countless landlords slaver-ing for the opportunity, what with the echoing vacancies now afflict-ing the cavernous Manhattan office market.

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Companies, owner of 600 Madison Avenue, and Rodney Company, own-er of 555 Madison Avenue. Togeth-er, their two buildings hold about 300,000 square feet now occupied by the jewelry firm.

Presumably, Tiffany is looking to consolidate those two offices into one more efficient space. We say “presumably,” because Studley de-clined to comment for this article, as did Tiffany.

Afterword: In May 2010, Tiffany closed on a lease for 260,000 square feet at 200 Fifth Avenue.

On Dec. 14, 2009, we reported …

Real Estate. Drama.

A&E, which is flying high with the launch of a new Jackson family real-ity show series, not to mention its curiously popular Steven Seagal ve-hicle, Lawman, is apparently feeling antsy.

The cable channel once known as Arts & Entertainment, which also owns Lifetime, has retained Robert Alexander, tristate chairman of real

estate behemoth CB Richard Ellis, to scout for about 300,000 square feet of new office space, according to two industry sources.

A&E has been headquartered since 1991 in 180,000 square feet at the kin-da shlocky 235 East 45th Street, ac-cording to the real estate database CoStar. The building is owned by the Hearst Corporation, which is also an owner of A&E.

Meanwhile, Lifetime has a rela-tively new long-term lease for 50,000 square feet on the second floor of Taconic Investment Partners’ 111 Eighth Avenue, between 15th and 16th streets, the stylish office build-ing that also houses Google.

The extent of A&E’s search is said to depend on whether subsidiary Lifetime can sublease its space at the media-popular 111 Eighth. If not, the network may significantly reduce its space requirements.

Either way, the cable network will have no shortage of options in this

glutted office marketplace.Neither a spokeswoman for A&E

nor Mr. Alexander would comment for this story.

Afterword: A&E is reportedly close to a lease for roughly 200,000 square feet at 150 East 42nd Street.

On Feb. 23, 2010, we reported …

Daily News to HQ: Drop Dead?

Staff writers at Mort Zuckerman’s New York Daily News may no longer have to work in one of the ug-liest office buildings to blight New York’s, or any city’s, streetscape. The Daily News has hired brokerage Cush-man & Wakefield to look for new office space. Rumor has it that the paper wants offices rough-ly comparable in size to the 120,000 square feet it now occupies at 450 West 33rd Street, at 10th Avenue, but the precise square footage could not be confirmed.

This could be good news. Not only are the Snooze’s current offic-es nearly two avenue blocks west of the nearest subway, but did we men-tion that the building, which has been compared to both the Death Star and an elephant’s foot, is ugly?

The Daily News signed the lease for 120,000 square feet in the 16-story edifice in 1994. Surely, Mr. Zuckerman had his reasons. One was probably

the building’s massive, newsroom-friendly 100,000-square-foot floor plates. (The Associated Press also has offices there.)

The Cushman broker handling the hunt, Michael Burgio, declined to comment for this article, as did a spokesman for the tabloid. But it’s possible Mr. Zuckerman is just trying to frighten his landlord, Broadway Partners, into offering lower rent.

For its part, Broadway Partners, which paid a staggering $664 mil-

lion for the 1.7 million–square–foot building mid-boom ’07, has every incentive to hold on to this prized tenant. Good occupants of similar size interested in moving to the far West Side are something of a rare com-modity these days.

Afterword: In July 2010, the Daily News and U.S. News & World Report announced they would re-

locate to 100,000 square feet in 4 New York Plaza.

On March 30, 2010, we reported …

Pulitzer Candidate Hunts

American Media, which had some-thing of a confusing 2009—with-standing a near brush with bankruptcy while publishing a Pu-litzer-contending National Enquirer series of exposés on the philander-ing would-be veep John Edwards—is looking for a real estate broker.

“We’re in the super, super, super-pre-liminary phases,” American Media Inc. spokeswoman Samantha Trenk told The Commercial Observer. “We haven’t yet selected an architecture firm or a broker.”

Ms. Trenk wouldn’t reveal pre-cisely how much space the media gi-ant, which also owns Men’s Fitness, Star, Shape and Country Weekly, is hunting for. But she did say that the firm’s lease at One Park Avenue, owned by Murray Hill Properties, ex-pires next year. Right now, the firm has space on two floors, totaling nearly 25,000 square feet, according to real estate database CoStar.

Media Wire Daily, an industry blog, first reported the incipient of-fice hunt late last week, posting a March 24 staff memo from Ameri-can Media chairman and CEO David Pecker. It reads, in part: “[W]e are in the process of looking at other loca-tions and developing a space plan. We will need your input, as we will be looking to upgrade from the cur-rent space and will provide you all with the most functional work envi-ronment possible.”

Afterword: American Media an-nounced in June 2010 that it would take 85,000 square feet at 4 New York Plaza.

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A New York Life: 51 Madison Avenue

Its days as a regular Garden of good and evil more than two decades past, the arena of Stan-ford White’s flamboyant life and equally flamboyant death was torn down in 1926 to make way for a nearly 1.2 million–square–foot building devoted to life in-surance. The Manhattan busi-ness of wealth had given way to the business of business, a purism of distilled commerce in which even life and death could be monetized.

The city turned perpen-dicular to accommodate the newly market-oriented soci-ety, and the days of opulently festooned gilt seemed quaint and old-fashioned. The Gar-den, for all its grandeur, nev-er actually turned a profit.

If White had lived two years more, he would have

seen its owners put the prop-erty on the market, eventu-ally to be picked up by New York Life Insurance for $2 million. White himself—though his prolific spending habits never showed it—was flat broke at the time of his death.

Bergdorf-Good-man’s Awl: 32 West 32nd Street

At 32 West 32nd Street, the climb to the K-pop-blar-ing karaoke bar—past the barbecue, the noodle shop, the eyelash salon—takes you up rasping wooden stairs, likely unchanged since their tailor-shop days. With a notable exception: The walls have been painted with cartoon Korean children, cavorting in the dim light like mutant hieroglyphs from one of Herman Bergdorf’s drunken dreams.

It’s one of those strange New York cor-ners where you can’t quite tell if the hasty brush strokes of the present are infringing on the past, or if it’s the other way around.

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A Certain Look: 488 Madison Avenue

The Look Building, which went up in 1950, was a pioneering player of the postwar metamorphosis itself. The building’s developers, the red-headed fraternal duo Percy and Har-old Uris, capitalized on new Mod-ernist tastes and deposited large, unornamented boxes around the city. “We’re not building in a vacu-um,” Percy Uris told Time in 1954. “We’re building in a market.”

The brothers’ build-ings frequently drew comparisons to either wedding cakes or Assyrian ziggurats, and the Look Building was among the former. Its curved, white edges are layered with two miles of ribboning glass windows, stacked one on top of another and tapering to a 23-story finish.

Designed by Emery Roth & Sons, the building in many ways presaged things to come, but it was also a sty-listic departure for the firm, which went on to define the city’s mono-tone glass-and-steel vernacular. The Look Building, while it drew some

criticism at the time, was at least committed to its bold masonry of rounded white brick.

The Disappeared Building: 234 West 42nd Street

Between 1990 and 1995, the city condemned the vast sweep of 42nd Street between Seventh and Eighth avenues, turning over its defunct

properties to the 42nd Street Devel-opment Corporation.

In place of Peepland, Madame Tussauds, which wanted a particu-larly conspicuous sign, convinced the state agency to condemn not just the building but 20 feet of air above the sidewalk. Madame Tus-sauds, the wax museum that man-ages to be both hokey and a stream-lined international entertainment experience (you can have the same one in London, Hong Kong, Las Ve-gas), installed 200 celebrity simu-lacra, among them a veiny Arnold

Schwarzenegger and a mechanically heaving Britney Spears.

It’s these oddly transfixing de-tails that reel the audiences in off the street.

The New Tiffany: 200 Fifth Avenue

The Toy Building may have been a lab of giddy delights, but it was ani-mated more by the patenting and manufacturing of those delights, transfixed by the mercurial forces of

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commerce running through them.But even before it gave itself over to the

children’s entertainment industry (worth, these days, about $22 billion annually), the address had something of an irresistible draw for industry. The 15-story structure, before it earned its more playful moniker, was known as the Fifth Avenue Building, a name perhaps meant to evoke some of the gilded opulence of the Fifth Avenue Hotel it supplanted.

The Fifth Avenue Hotel was known less for its accommodations (luxurious though they were, with princes and dukes among the reg-ular patrons) than for the backroom deals cut in its stiffly upholstered corridors. Its sitting rooms were magnets for industrial tycoons (Jay Gould and Commodore Vanderbilt among them), and New York’s Republican leadership orchestrated state and city business from a nook known as the “amen corner.”

Urban Legend: 300 West 57th Street

It took another boom decade for Hearst (long dead, the Hearst empire not looking much better) to finally have his tower. When it was finished, in 2006, Norman Foster’s glass triangles shot up through the original build-

ing’s center, all gleaming zigzags and brazen geometry. It was an almost cartoonish stunt, a crosshatched, pow-fisted phantom blasting through Joseph Urban’s stupefied tomb.

But for all its incandescent fantasy, Lord Foster’s vision was a distinct departure from Urban’s sumptuous brand of showmanship. Developers these days may be angling for green status, but at the turn of the last de-cade, when the Hearst Corporation enlisted Lord Foster, the idea of a green-certified city was little more than an idea. With its recycled steel-stitched lattice, its glass triangles gush-

ing natural light, the tower was the first com-mercial building in the city to be declared en-ergy-efficient.

The apotheosis of Hearst’s real estate dreams, 70-odd years in the making, was also a kind of inversion—an imprint tempered by its surroundings.

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regularly are: 1. Do I actually write the articles? 2. How do you find the time to write them? 3. Why do you write them?

To understand my answers to these questions, it is helpful to un-derstand what drives me. Let me try to provide some insight.

I have always been interested in economics. Going back to my freshman year at the Wharton

School, I listened intently to classic illustrations using guns and butter or water and diamonds to explain economic fundamentals in Samuel-son’s Econ 101 textbook.

These theoretical relationships came vividly to life for me when I saw the impact the dreaded “Cuo-mo Tax” had on the investment sales market. This tax was a New York State capital-gains tax that added an additional 10 percent tax to any in-vestment property sale with a price in excess of $1 million. I saw that this tax forced transaction volume to dry up, as it simply became too ex-pensive for sellers to part with their

properties. This was not an unexpected re-

sult (at least if you were actually in the business and not a politician without real-world experience). If you make anything more expensive, there is naturally less of that activ-ity. What was really eye-opening to me was that after the tax was re-pealed, tax collections from real es-tate transactions, including capital-gains taxes, actually increased, as transaction volume picked up signif-icantly. This was one of those “a-ha” moments for me. I wanted to under-stand more about how public policy impacted me, sitting at my desk each day, trying to sell buildings in New York City.

This thirst for knowledge turned me into a voracious reader. I wanted to get my hands on everything pos-sible to broaden my knowledge and understanding of the macroeco-nomic ramifications of public policy on commercial real estate sales. To this day, I regularly read The Wall Street Journal, The Times, the Post, Crain’s, Barron’s, Forbes and the Fi-

nancial Times as well as all of our great real estate trade publica-tions.

Beginning in the summer of 2007, when the credit crisis start-ed to tangibly be experienced, uncertainty about current and future market conditions caused even the most seasoned partici-pants in the market to question what was going on in our market-place. We saw an unprecedented level of government intervention as the crisis grew into the Great Recession, which led to “issues” for Fannie Mae, Freddie Mac, GM, Chrysler, Lehman, Bear, AIG and a host of others. We saw TARP, TALF, PPIP and several rounds of “stimu-lus.” Within the past three years or so, we have witnessed a time in which there have never been (at least during my 26-plus years of bro-kering property sales in the Big Ap-ple) closer ties between economics, politics and real estate.

During this time, the frequency of my periodic “Commentary” writings to my clients increased and I began

to write my StreetWise blog. Then, one year ago, Tom asked me to write for The Commercial Observer, and I happily agreed to join what has been a fantastic team to work with. Writ-ing had become a weekly habit.

So let’s get back to the three fre-quently asked questions.

Do I actually write this column? Yes, I write every word of these

columns. My wife, Cynthia, who puts

Because public policy often intersects—collides, in fact— with commercial real estate

So You Want to Know Why I Write What I Write …

ConCrete thoughtsrobert Knakal on

Multifamily’s Future

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concrete thoughtS AnnIverSArY SpecIAl

Robert KnakalColumnist

For the complete archive of Robert Knakal’s Concrete

Thoughts columns, go to Observ-er.com/concrete-thoughts.


ConCrete thoughtsrobert Knakal Breaks

Down 1Q Building sales

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New York’s global real estate firm.

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Beyond NYc

how the Outer Office Marketsalmost Beat the recession

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and Vacancies

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concrete thoughts AnniversAry speciAl

up with an alarm clock going off very early on weekends, and my assis-tant, Erin Mitchell, who transcribes my dictation each week, can both at-test to this.

How do I find the time to write this column?

As my brother, Jeff, would always tell me, you can find the time to do anything if it is important enough to you. One of the keys to a successful and happy life is to be able to priori-tize things and to find that delicate balance between each of the things that are important to you. That be-ing said, I always remain cognizant of the fact that my real job is to be an asset to Massey Knakal Realty Services and my primary contribu-tion to the company is to sell prop-erties for our clients. I, therefore, cannot take time away from clients who have entrusted me with the re-sponsibility to do everything I can to maximize the sales prices of their properties.

I am also blessed to have a won-derful family, including my wife, Cynthia, who is very understanding of the considerable time commit-ment a career in commercial real estate requires, and a nearly 2-year-old daughter, Sophie, who I want to spend as much time with as possi-ble.

So to answer the second ques-tion, I begin my day on Saturdays and Sundays at 5 or 6 a.m. and work on my writing until 9 or 10, when the family is up and ready to start the day (Sophie has, thankfully, slept for 12 hours each night since she has been 2 months old). Saturday morn-ings are spent organizing thoughts, doing some research, creating an outline and then dictating the col-

umn into a microcassette recorder. I then send the tape to Erin, who tran-scribes the tapes before Saturday evening. Sunday mornings are spent cleaning up and editing the col-umn. I also use Sundays to work on my blog and write any commentar-ies used in Massey Knakal’s market-ing efforts. By utilizing these early-morning weekend hours, I am taking time away from neither my clients nor my family.

Why I Write?The answer to the third question

requires a more detailed explana-

tion. An obvious reason is that the ex-

posure provided by this endeav-or creates business opportunities. While this is part of the answer, it is, indeed, only a part of why I do this.

To understand the rest of the rea-sons, let me start by saying that I am very passionate about my profes-sion. I love selling properties, and I believe strongly in the niche in which Massey Knakal competes. I have al-ways believed that anything worth doing is worth doing well, and I have always strived to do better than my best in all of my endeavors.

When Paul Massey and I started brokering in 1984, our niche, in non-institutional building sales, was the Rodney Dangerfield of the commer-cial real estate industry in New York: It got no respect. We grew up in the business in a vacuum. The niche was devoid of transparency and readily available information and statistics, which led to a lack of stature gener-ally associated with larger property sales. At that time, large sales were the darlings of the media (and still are to a large degree). Rarely was a noninstitutional property sale writ-ten about.

When we started, participants in our niche were accustomed to one-page setups; exclusive listings were a rare occurrence; and transactions were often “flipped” several times over. Each broker had a few “go to” buyers and not much was done be-yond that. Few agents specialized only in building sales, and those that did were relatively covert opera-tors.

These market conditions provid-ed us with a deep-seated mandate to make our market niche as prom-inent as the market for properties over $100 million was. We wanted to enhance market transparency and stature, and to convey the vi-ability of the building sales market at the noninstitutional level. Paul and I wanted Massey Knakal to be a source of expertise and information for those who were active in New York City’s building sales market. We always wanted to provide the real estate community with prop-er market overviews, data, insight and statistics to help make the mar-ket more transparent and efficient. Our philosophy of freely sharing information was possible because of our belief that, in New York City, with 165,000 investment properties, there is always plenty of business to go around for everyone.

The noninstitutional property sales niche is, indeed, a valuable component of the mosaic that is New York’s commercial real estate mar-ket. Writing about this market in a publication like The Commercial Ob-server affords me the ability to reach thousands of market participants ef-ficiently and effectively to achieve the objectives mentioned above.

Lastly, writing this column allows me to be a voice for the industry—


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concrete thoughts AnniversAry speciAl

Within the past three years or so, we have witnessed a time in which there have never been (at least during my 26-plus years of broker-ing property sales in the Big Apple) closer ties between economics, politics and real estate.

joining so many others who admira-bly serve as advocates for our com-mercial real estate community. More advocates are needed to influence the perspectives of the people who have the ability to affect our market-place through regulatory or legisla-tive changes.

Far too many of our policy mak-ers and politicians have no private-sector experience. Even more don’t understand basic economic prin-ciples. Unfortunately, getting re-elected is the main objective for an overwhelming majority of our elect-ed officials, as opposed to trying to make beneficial changes. Glaring examples of misguided initiatives

are seen in pending rent-regulation reform, prevailing wages (which caused the implosion of the Kings-bridge Armory transaction in the Bronx), tax policy, entitlements, union contracts, public-sector pen-sions—the list goes on and on. Each of these things, in their own way, im-pacts our real estate market.

Through my writing, I attempt to create awareness of the policies and issues affecting our industry. The more aware we all are of these issues, the more likely it is that we may be able to impact the perspec-tive of a policy maker. Steve Spino-la and the Real Estate Board of New York do a terrific job of advocating for our real estate community. I be-lieve that each of us, in our own way, should be ambassadors for our in-dustry. If something is good for our industry collectively, it is good for each of us individually.

Writing this column each week is not easy, as I have not been on a “work-related” deadline

since I had to be on time for exams in college (hence, my enhanced admi-ration for the journalists who cover our real estate industry). Not easy, but I believe it is beneficial to some of the people in our industry, and it is important to me personally. Much of the research for the column pro-vides a learning experience. Contin-ually focusing on self-improvement is a trait commonly found in highly effective people, and here, the focus cannot be avoided.

I am hopeful that today’s column provides some insight into the If, How and Why of my involvement with The Commercial Observer. Thank you again for all of your sup-port, and if you would like to share

ideas for column topics, please feel free to keep the suggestions coming.

[email protected]

Robert Knakal is the chairman and

founding partner of Massey Knakal Realty services and in his career has brokered the sale of more than 1,075 properties, having a market value in excess of $6.5 billion.

For the complete archive of Robert Knakal’s Concrete Thoughts col-

umns, go to Observer.com/concrete-thoughts.


By Emily GEmindEr

in New York, the skyline sometimes recedes, but it never disappears entirely. Height, like money and

power, is among the city’s eternally recurring preoccupations, a kind of suspended totem of commerce, the skyline’s residual tic. The skyline, af-ter all, is not viscerally experienced so much as occasionally glimpsed and secreted away, stowed as eight million portable New Yorks. We fer-ry them across space and time, piece them together according to lopsided memories, instinctively shield them from change. Which is why we take the skyline so personally: The re-membered city follows rules more impenetrable than any municipal zoning code, more persistent than a thousand landmark preservation commissions.

In the remembered city, familiar-ity becomes its own mythology.

With the recent thousand-foot-plus skirmishes along New York’s contested contour—developer Vor-nado Realty Trust and cheerleaders of development on one side, defend-ers of the Empire State Building’s solo reign on the other—the Ho-tel Pennsylvania, which Vornado’s 1,216-foot 15 Penn Plaza will likely displace, has mostly been lost in the fray. Virtually all parties have more or less unanimously conceded the 90-year-old structure as a pre-mor-tem footnote to the inevitable saga of development.

But the hotel, once the biggest in the world (and whose switchboard, when dialed, still belts out the old-est digits in New York—Glen Miller’s rowdy “Pennsylvania 6-5000”), has

long occupied a curious place in the city’s margins.

The early part of the last cen-tury was a heady time for city dwellers. New York was lurch-

ing upward, metastasizing in plain view, quickening into a real estate free-for-all of glass and steel, send-ing up hundreds of tall buildings only to tear them down and replace them with taller ones. As the Empire State Building was preparing to cast aside a stocky old hotel of its own (the Waldorf-Astoria would move uptown), other contenders for the claim of world’s tallest building were busily at work, among them Edward L. and John A. Larkin, a pair of ar-chitect-developer brothers, who in 1926 proposed a 110-story paean to the new order of gigantism. The ta-

pering Larkin Tower, which would plunk 950,000 square feet of rent-able real estate on Eighth Avenue and 42nd Street, at once established the brothers in the pantheon of mod-ern-day Babelites and hastened the competition’s skyward race.

Biggest, tallest, best. The Larkin

brothers, who had already affixed their names to a bevy of major real estate ventures, had a natural devel-opers’ predilection for superlative marketing. Two years before an-nouncing plans for the Larkin Tower, they filed suit against the Pennsylva-nia Railroad, alleging the railroad

Why the world’s biggest hotel became just another thing you might notice

Eight million new yorks

Go, cat, go: the Hotel Pennsylvania back in its prewar day.

The lead indicaTorSam chandan ParsesMayor’s new Budget

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tale of retail

Cushman & Wakefield’sBrad Mendelson on

Clinching Uniqlo By JothaM SederStroM

the Lead IndICatorSam Chandan: Bank Failures and Commercial real estate

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ConCrete thoughtsrobert Knakal Breaks

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Global Expertise

231 offi ces • 58 countries

Power BroKernewmark’s howard Kesseler

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Retail New York: 2010

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The blunt steely force of the tower soon likely to supplant the Hotel Pennsylvania has, at least for the moment, reanimated the collective charge, however often gener-ated, that the skyline sparks in its denizens.

stole their idea for the world’s larg-est hotel, the Hotel Pennsylvania.

According to the Larkins’ account, in 1916 the Pennsylvania Railroad returned the brothers’ plans for a 30-story hotel across from Pennsyl-vania Station, contending that the network of tunnels running beneath the site would render the engineer-ing all but impossible. Plans for the Hotel Pennsylvania were filed soon after.

It was the same year that New York’s original zoning provisions were signed into law, intended to temper the spasm of steel construc-tion booming its way across the city grid. The Hotel Pennsylvania itself was expected to herald an influx of towers along Seventh Avenue, trans-forming the area into a commuter-office hub of prime real estate— a precursor, perhaps, to Vornado head Steve Roth’s dreams of a seamless glass-encased urban experience: part mall, part office complex, part civic center.

The hotel’s grandiloquently over-stated interiors—the Turkish baths, the Café Rouge where Benny Good-man and Tommy Dorsey swung—have long been gutted, and its status as the world’s biggest hotel has long

been surpassed. Its sole continuous heritage is perhaps its amenability to large conferences of the many ob-scure (linguists studying Pig Latin, assemblies of spiritualists, Mexi-can rebel forces) and not so obscure (Westminster Kennel Club dog show participants, Republican National Conventioneers) parties eternally descending on Manhattan.

The hotel was part of the Hilton chain for a period starting in the 1950s, coinciding with Conrad Hil-ton’s gospel of the hotel as Commu-nist deterrent. Other owners have included Ong Beng Seng, the Singa-porean billionaire and major stake-holder in Planet Hollywood Interna-tional, as well as the eccentric tycoon and failed politician “Honest” Abe Hirschfeld. But for most New York-ers, the hotel was something else en-tirely: just a familiar blur of columns and trumpeting flags christening the churning masses that rise and fall from Penn Station. No more, no less.

The Great Depression brought a quick cessation to the Larkin broth-ers’ bid for the skyline. Their tower was among the many abandoned

projects left like craters in an alter-nate boom-time city. But who knows what architectural shudders it im-pelled, what towers it incited? A city is a microcosm of innumerable ac-

tors, tugging the skyline in unknow-able ways. The compulsion to leave an indelible mark on New York, an act one would be hard pressed to match in hubris or ego, is also eter-

nally usurped by the coming skyline, mediated by the city’s competing multitudes.

The blunt steely force of the tower soon likely to supplant the Hotel Penn-

sylvania has, at least for the moment, reanimated the collective charge, however often generated, that the skyline sparks in its denizens.

[email protected]


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June 1, 2010 The Weekly NeWspaper of NeW york’s CommerCial real esTaTe iNdusTry $7.00

CONCRETE THOUGHTSRobert Knakal Reveals Manhat-tan’s New Hot Neighborhoods

LEaSE BEaT444 Madison ❯❯100 Park avenue

POwER BROKERCBRE’s Stuart Eisenkraft Juggles Global Deals ❯❯

New York’s Top 10 Skyscrapers

BY EUGENE GiLLiGaN


❮❮ Observer POwer 100Inside Our big Party

For big Names

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THE LEAD INDICATORSam Chandan on the Employment Report

LEASE BEAT40 Wall Street

280 Park Avenue❯❯

POWER BROkERPrudential Douglas

Elliman’s Joseph Aquino ❯❯

West Side Story

Related president Jeff Blau on developing the West Side Yard

BY JOTHAm SEDERSTROm


212.594.2700 | slgreen.com


calendar


tUeSday, SePtemBer 14This summer was the hottest in

New York since meteorologists be-gan tracking the weather. So unless you’re a rabid, right-wing conserva-tive, it’s fair to assume climate change

is a man-made phenomenon. Then isn’t it time to consid-er sustainable, e nv i ro n m e n -tally friendly construction? The folks at the Center for Ar-chitecture are hosting a discus-sion with lead-ing urban plan-

ners, all of whom are knowledgeable about the latest eco-trends. Nonethe-less, we presume the talks will be in an air-conditioned building.

[“Urban Cool: Sustainable Com-munities in the Age of Global Warm-ing” event, the Center for Architec-ture, the Hines Gallery, 536 LaGuardia Place, 2:30 p.m., send email to [email protected] for more info]

With fall approaching, golf en-thusiasts only have so many more opportunities to tee off before bad weather strikes. That’s why taking advantage of the National Realty Club’s Wheatley Hills golf outing may be your last best shot, even if it means shmoozing with overeager colleagues and bosses.

[National Realty Club “Golf Out-ing,” Wheatley Hills, 147 East Wil-liston Avenue, East Williston, New York, www.nationalrealtyclub.com for info]

WedneSday, SePtemBer 15Go back in time to the days of the

three-martini lunch when the Great-er New York Chapter of the Insti-tute of Real Estate Management hosts its monthly luncheon, followed by a delightfully early networking cocktail hour. For those who aren’t already too sloshed, the keynote speaker is John Klein of JDM Asso-ciates, and the topic de jour is “The Human Factor: The Key to Sustain-ability & Profitability.” Expect tons of fun until the very last drop.

[Institute of Real Estate Manage-ment monthly luncheon, New York Helmsley Hotel, 212 East 42nd Street, 11:30 a.m., visit www.iremnyc.org or call 212-944-9445 for more info]

When, in 1975, the New York State Supreme Court struck down Grand Central’s landmark status, the Mu-nicipal Art Society and Jacqueline Kennedy Onassis went into action, sparking a campaign that would save the terminal from becoming an office tower. The talented Munici-pal Art Society guides return to the scene of near disaster for a tour of the terminal’s Beaux-Arts interiors.

[Municipal Art Society Grand Central Terminal walking tour, meet

at the information booth, main con-course, Grand Central, 12:30 p.m., www.mas.org]

SatUrday, SePtemBer 18As sure as the changing of the

seasons, New York’s shape is con-stantly shifting. And nowhere is that more true than in Lower Manhattan, where construction at One World Trade Center, a new Frank Gehry apartment project and other build-ings are currently under construc-tion. Taking a break from the city’s

older landmarks, the hipsters over at the Municipal Art Society are in-viting guests on a tour of the area’s newest developments. See them first, before anyone else.

[Municipal Art Society “New to New York: Downtown” walking tour, meet at the southwest corner of Chambers and Centre streets, oppo-site the Municipal Building, 11 a.m., call 212-935-2075 for info]

SUnday, SePtemBer 19If we didn’t know better, we’d

start to think the tour guides of the Municipal Art Society were a bit star-struck by Brooklyn and, in particular, the neighborhoods of Boerum Hill, Cobble Hill and Carroll Gardens, where the crew is hosting

its third walking tour this year. In-deed, join the society’s wide-eyed guides as they visit beautiful row houses, churches and, in their own words, “some of the most beauti-ful ornamental iron railings in New York.” Swoon! Get a room, guys!

[Municipal Art Society “BoCoCa III: Cobble Hill” walking tour, meet in front of St. Paul’s Church on the cor-ner of Court and Congress streets, 2 p.m., call 212-935-2075 for more info or visit www.mas.org]

tUeSday, SePtemBer 21The Trump family will don their

real estate caps during a presum-ably swagger-filled breakfast meet-ing with members of the Real Estate Lenders Association. But even if you aren’t working directly for the Don-ald and his son, Eric Trump, best to come early for what’s sure to be a crowded seminar—lest the telegenic twosome decide to fire your ass, Ap-prentice-style.

[Real Estate Lenders Association breakfast, Yale Club of New York, 50 Vander-bilt Avenue, 8 a.m., visit www.rela.org for more info]

The Commercial Observer’s very own Concrete Thoughts columnist, Robert Knakal, will school real estate profession-als in all things multi-family when his firm, Massey Knakal Realty, hosts a fun-filled summit on top-ics such as stu-

dent housing, senior living, online marketing and more. Gary Barnett, president of Extell Development, will be the keynote speaker.

[Massey Knakal Realty Services “Multi-Family Summit,” McGraw Hill Conference Center, 1221 Avenue of the Americas, 8 a.m., contact Ryan Slack at 646-862-9389 or email him at [email protected] for more info]

To understand New York, you need to start with Lower Manhattan. That said, the guides of the Munici-pal Art Society are continuing their weekly downtown walking tour,

which will most definitely in-clude visits to Wall Street

and a few old churches. [Municipal Art So-

ciety “Downtown, Where New York Be-gan” walking tour, meet at the Down-town Info Center, 55 Exchange Place, Suite 401, 12:30 p.m.,

www.mas.org]

Calendar items can be sent to Jotham Sederstrom at [email protected].


PRESENTS

Masters of Real EstateWEDNESDAY OCTOBER 13, 2010

8:00 AM – 2:00 PMThe Metropolitan Club | One East 60th Street | New York

FEATURED TOPICS➥ STATE OF NEW YORK CITY REAL ESTATE➥ STATE OF CAPITAL MARKETS ➥ WHAT ARE THE OPPORTUNITIES?

WHO SHOULD ATTEND• IndIvIdual and InstItutIonal Investors • Government reGulators • PrIvate equIty FIrms and lenders • ProPerty owners and develoPers

Registration & More Detailed Information: www.observerpaid.eventbrite.com

ticket Price: $500 | seating is limited | Please rsvP by october 6

For reGIstratIon by maIl: Please return this portion with a $500 check made payable to: The New York Observer Mail to: Ashley O’Brien, New York Observer, 321 West 44th Street, 6th Floor, New York, NY 10036 by no later than October 6th

NAME:__________________________________COMPANY: _________________________________________

address:___________________________________________________________________________________

Phone number:_________________________emaIl: ______________________________________________

you wIll receIve a conFIrmatIon by emaIl that your request has been receIved.

SPEAkERS INCLUDE:Keith barket, angelo GordonJeff blau, related companiesandrew Farkas, Island capitalJon Gray, blackstonemarc holliday, sl Greenron Kravit, cerberus

richard leFrak, leFrak organizationrichard mack, arearob speyer, tishman speyerbarry sternlicht, starwood capitalJay sugarman, istar Financial*panelists subject to change

In a climate of significant change, The New York Observer is inviting industry leaders to discuss the current real estate landscape.



Studley Promotions, top rookies

Tenant rep brokerage Studley has promoted seven of its profes-sionals in the firm’s New York City headquarters, it was announced last week.

Rick Drescher, 30, was promot-ed to managing director of technical services from director of technical services.

Dean Feratovic, 31, was promot-ed to director of human resources from manager of human resources and professional development.

Joe LaBarbera, 32, was promot-ed to director of finance from senior finance analyst.

Jia Li Chen, 28, was promoted to senior corporate accountant, follow-ing a previous position as a financial

analyst for the firm.Rose Panos, 28, was promoted to

event marketing manager from mar-keting associate.

Colin Johnson, 26, was promot-ed to a position as a financial analyst from a previous post as a staff ac-countant.

And Melinda Wright, 38, was promoted to graphics specialist from graphics assistant.

Meanwhile, two Studley real es-tate brokers were honored with “Rookie of the Year” awards during the company’s summer outing in San Francisco, it was announced.

Bie Chu Lee, 32, from the firm’s Washington, D.C., office and Michael Mathias, 25, of the New York office, were both given the award.

Mr. Lee, an associate who joined the firm in August 2009, was cred-ited with assisting his team with knowledge of financial structuring, strategic planning and development for corporations, law firms and non-profits, according to a release.

Mr. Mathias, who joined the firm in 2007, received the award in part through his success in winning new business, as well as handling all as-pects of new deals, alongside a team that includes executive managing director Erik Schmall.

__

Colliers Poaches CBre

Colliers International hired real estate broker Alan Desino as an ex-ecutive managing director in the firm’s New York headquarters, it was announced last week.

Mr. Desino, 47, who has closed more than $1 billion in real estate transactions for Cushman & Wake-field and, most recently, for CB Rich-ard Ellis, will be responsible for Colliers’ growing tenant rep and cor-porate services divisions.

“Alan Desino is the type of impres-sive, strategic-minded real estate professional and dynamic deal maker we are seeking to help take Colliers International to the next level,” said Mark Jaccom, CEO of the company’s tristate operations, in a statement. “Alan is a senior executive with a suc-cessful track record working with tenants and landlords in the nation’s most competitive market.”

__

Cohen Brothers’ Leasing VP

Cohen Brothers Realty Corpora-tion, the private commercial prop-erty management firm, hired Marc Horowitz as vice president of leas-ing, it was announced.

Mr. Horowitz, 39, will be respon-sible for overseeing Cohen Brothers’ in-house leasing team, which carries

out the leasing programs for approximately 8 million square feet of Class A Man-hattan office space, accord-ing to a release.

Mr. Horowitz previously served as a partner in the brokerage division of Kauf-man Adler Realty, which to-day is known as the Kauf-man Organization.

“We’re confident Marc will prove to be a valuable resource for our compa-ny and an important addi-tion to our in-house leasing team,” said Cohen Brothers’ president and CEO, Charles

Cohen, in a statement.

__

also Notable …

CNY Builders tapped Jeffry Wen-groff as operations director for the firm’s health care division, it was an-nounced last week.

Mr. Wengroff, a 59-year-old con-struction industry veteran who has worked alongside health care pro-fessionals for four decades, will provide oversight and direction to CNY’s project teams working on health care assignments.

“Our healthcare practice has been growing rapidly,” said Ken Colao, pres-ident of CNY Builders, in a statement. “Jeff’s outstanding reputation in the industry and his widely recognized expertise in estimating and project management make him the ideal per-son to supervise this growth.”

[email protected]

the LoBBy

June 22-29, 2010 The Weekly NeWspaper of NeW york’s CommerCial real esTaTe iNdusTry $7.00

ConCrete thoughtsInvestment sales

Mini-Bubble

Lease Beat250 West 57th street

one Park avenue❯❯

br

ian

le

tw

in

PoWer BrokerJames emden on Move

to Colliers International ❯❯

the sIt-DoWn: gLenn rufrano

a Candid talk WithCushman & Wakefield’s

new Chief ‘everybody needs to do more with less’

By JothaM seDerstroM

special double issue


Global Expertise231 of ces • 58 countries

July 13, 2010 The Weekly NeWspaper of NeW york’s CommerCial real esTaTe iNdusTry $7.00

ConCrete thoughtsWhy LeBron really

Picked Miami


one grand Central❯❯

joe

wo

olh

ea

d

PoWer BrokerLawyer gary eisenbergon ‘Cope and hope’ ❯❯

Congratulations?Durst Bests related for 1 WtC stake

now, the Fine PrintBy eLiot BroWn

July 6, 2010 The Weekly NeWspaper of NeW york’s CommerCial real esTaTe iNdusTry $7.00

(Dis)stresseD Out?Knakal on uncertainty;Distressed by status

Lease Beat40 Wall street❯❯45 Main street

lou

isa

ca

nn

ell

; pr

op

er

ty

sh

ar

k

pOWer BrOKerrKF’s ariel schuster sells Big-Boxes on Vertical ❯❯

Leases up! the top 10 expirations of ’10

Where they are Now and What that MeansBy roland Li


212.594.2700 | slgreen.com


mr. dresher. mr. mathias.

mr. Lee. mr. horowitz.

mr. Wengroff.


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By HeatHer Holland

tip-toe across this Tweet Week, for tweet-

ers mulled more than they gossiped. Some made predictions, some prepped for events and others asked thoughtful questions, but all in all, things are on the in-trospective side this time around.

CB richard ellis (@cbrenyc) predicts rain in retail.

RT @cbrecorp: Per CBRE Econometric Ad-visors, U.S. Retail Availability Rate Expected to Start to Decline Early Next Year http://bit.ly/cXIGlv

6:18 AM Sep 8th via TweetDeck

RT @cbrecorp: More than 1,000 CBRE Professionals to Complete Rebuilding Proj-ects in September for Those in Need http://bit.ly/99SEe9 #CRE

7:13 AM Sep 7th via TweetDeck

Cushman & Wakefield (@Cush-Wake) gets its fill.

The Broker Who Would Fill One World Trade | The New York Observer http://t.co/QWQqa0h via @AddThis

10:21 AM Sep 8th via Tweet Button

Jones lang laSalle (@Jllnews) star gazes at reports.

Is U.S. industrial RE on the road to the recovery? Check JLL’s Q2 report covering the largest markets in the Americas http://ow.ly/2AO2I^JB

3:24 PM Sep 7th via HootSuite

reBny (@reB-ny) marks the calendar.

S t u y Town’s Main S t a k e h o l d -

er Sets Auc-tion Date to Sell

Massive Complex http://ow.ly/2BbHJ


FYI: TRD Government Brief, Cuomo settled last

month with Pinnacle Secu-rity Group: http://ow.ly/2BbeS


Moving to the suburbs to raise a family? Slow down and take a look at “Friends Don’t Let Friends Move to the Suburbs” http://ow.ly/2AFiT


Massey Knakal (@MasseyKnakal) gives an update.

Featured Listing: 115 East 37th Street, New York, NY- 1861 Murray Hill townhouse, duplex unit could be delivered vacant http://bit.ly/bkF3tm

4:03 PM Sep 8th via web

Featured Closing: 331 East 81st Street, New York, NY 10028 - a five-story mixed-use builing on UES http://bit.ly/cN5Dld

10:34 AM Sep 7th via web

eastern Consolidated (@eastern-consol) speaks of the day.

David Schechtman to speak at upcoming REBNY Members’ Luncheon on “The Market: What’s Really Happening” October 5, Hilton Hotel, 12:30

1:29 PM Sep 7th via web

tWeet WeeK

Now tweet us!@

commercial_nyo.


July 20, 2010 THE WEEKLY NEWSPAPER OF NEW YORK’S COMMERCIAL REAL ESTATE INDUSTRY $7.00

CONCRETE THOUGHTSKnakal on Investment

Sales at Midyear

LEASE BEAT650 Fifth Avenue

One Grand Central Place

KAT

HIE

KH

OU

RI

THE SIT-DOWNKen Levien: Project

Management Measure

David Schechtman Has Something to Say

Eastern Consolidated’s Newest PartnerBY JOTHAM SEDERSTROM


212.594.2700 | slgreen.com

August 3, 2010 THE WEEKLY NEWSPAPER OF NEW YORK’S COMMERCIAL REAL ESTATE INDUSTRY $7.00

CONCRETE THOUGHTS Investment Sales In the Boroughs

THE SIT-DOWNBruce Schonbraun

Talks Foreign Investors

POWER BROKERStudley’s Ira Schuman On Nonprofits, Ingenies

Monster Deals

605 Third Avenue

100 Church Street

345 Park Avenue

555 West 57th Street1633 Broadway

Suddenly, Several Leases Of 100K-Plus FeetBY WILLIAM ALDEN & LAURA KUSISTO

LEASE BEAT


212.594.2700 | slgreen.com

July 27, 2010 THE WEEKLY NEWSPAPER OF NEW YORK’S COMMERCIAL REAL ESTATE INDUSTRY $7.00

INVESTMENT SALESKnakal and Chandan

Dissect Locally, Nationally

LEASE BEAT125 Park AvenueSeven Penn Plaza

KAT

IE K

HO

UR

I

POWER BROKERJeffrey Lichtenberg on

Re-Reaching the Top

Murray Hill’s Norman Sturner, Yesterday and Today

‘When we came into the business 40 years ago, we didn’t understand leverage’ BY JOTHAM SEDERSTROM


lease BeatEmail information on new leases to Emily Geminder at [email protected]

1412 Broadway 35,000 Escada US Subco LLC n/a Jesse Rubens and Esther Zar of Murray Hill Properties brokered the 10-year deal.

48 West 37th Street 8,901 E & B Giftware LLC n/a David Levy and Joseph Friedman of Adams & Co. represented both the tenant and the landlord in the six-year transaction.

48 West 37th Street 5,557Sperber, Denenberg & Kahan, P.C. n/a

David Levy and Joseph Friedman of Adams & Co. represented both the tenant and the landlord in the 10-year transaction.

56 West 22nd Street 5,000 Zemoga n/aElliot Warren of the Kaufman Organization represented the tenant in the two-year sublease, while Perry Mes-mer of Colliers International repped the landlord.

540 Madison Avenue 3,000 Panco Management Boston Properties Jones Lang LaSalle represented both landlord and tenant in the three-year renewal.

126 East 56th Street 2,900 Goffe Capital Management Transwestern Invest-ment Co. Alex Cohen of Cushman & Wakefield represented the tenant in the five-year deal.

90 Broad Street 2,495 National Book Foundation Swig Equities CBC Hunter Realty represented the tenant in the 10-year deal. Todd Koren repped the landlord in-house.

648 Broadway 2,300 Atheros n/aAndy Epstein of Easy Street Properties represented the tenant. Gabe Isaacs of Sierra Realty repped the landlord.

149 Madison Avenue 1,907 Furniture Rental Associates Abramson Brothers CBC Hunter Realty represented the tenant. The landlord was repped in-house.

1123 Broadway 1,891 Sense Networks Inc. Kew Management Dan Schwartz of Winslow & Co. represented the tenant. The landlord was repped in-house.

459 Washington Street 1,600 C.A.C Industries, Inc. n/aMichael Chow of New York Commercial Realty Services represented the tenant in the five-year deal. Michael Pligavko and Terrie Liu of Bosse Property represented the landlord.

sq. Feet tenant landlord BroKers



LEASE BEAT230 Park Avenue

133 Fifth Avenue

THE SIT-DOWNJonathan Miller, Meet

The Commercial Observer

The Lawyers You Call

The Top Firms, PlayersBY JOTHAM SEDERSTROM

Plus: Our New Law Columnist on

Good-Guy ClausesAnd! Sam Chandan on

A Busy Congress

WEEK IN REAL ESTATE Value vs. Cost

At 1 WTC


212.594.2700 | slgreen.com


LEASE BEAT400 Madison Avenue

227 Mulberry Street

POWER BROKERNewmark Knight Frank’s Jennifer Schwartzman

THE SIT-DOWN

Everybody Wants to Know What This Man

Has Planned Anthony Orso of Cantor Fitzgerald

BY JOTHAM SEDERSTROM

THE LEAD INDICATORSam Chandan on

Price and Performance


LEASE BEAT320 Park Avenue 40 Wall Street

POWER BROKERCBRE’s Greg Kraut On Asian Fusion

First Year Joseph Swingle, Grubb & Ellis’ New Local Chief, Talks Expansion, HiringBY JOTHAM SEDERSTROM

CONCRETE THOUGHTSRobert Knakal Sizes Up Multifamily at Midyear

THE SIT-DOWN

SHRA

VAN

VID

YART

HI


212.594.2700 | slgreen.com



112 West 14th Street 1,500 One Light Ministry n/a Michael Chow of New York Commercial Realty Services represented the tenant in the one-year lease. Ber-trand de Soultrait, also of New York Commercial Realty Services, repped the landlord.

1407 Broadway 1,446 Antex Knitting n/a Sommer Scafidi of the Kaufman Organization represented both landlord and tenant in the three-year lease.

1407 Broadway 1,424 Major Textiles Imports Inc. n/a Sommer Scafidi of the Kaufman Organization represented both landlord and tenant in the three-year lease.

1407 Broadway 1,410 Eurostyle International Inc. n/a Sommer Scafidi of the Kaufman Organization represented both landlord and tenant in the five-year lease.

299 Broadway 1,300 Gateway Management n/a GlenMark Realty represented the tenant in the five-year deal. Olmstead Properties repped the landlord.

291 Broadway 1,260 Geyneir and Associates n/a Nick Zervis and David Gomez of GlenMark Realty represented both the landlord and the tenant in the 10-year deal.

270 Lafayette Street 1,250 Lauffer Wind Group n/a Lindsay Dukes of New York Commercial Realty Services represented the tenant in the five-year deal. Steve Marvin of Olmstead Properties repped the landlord.

915 Broadway 1,250 Data Logix n/a GlenMark Realty represented the tenant in the three-year lease. John LiGreci of ABS Partners repped the landlord.

405 Lexington Avenue 1,057 Oxford Analytica Tishman Speyer Waite Buckley of Vicus Partners represented the landlord in the four-year deal. The landlord was represent-ed in-house.

648 Broadway 1,025 Patricia McMahon LTD n/a Gabe Isaacs of Sierra Realty represented both landlord and tenant.

291 Broadway 800 Lattice Engines n/a David Gomez of GlenMark Realty represented both landlord and tenant in the two-year lease.



THE SUCCESS OF 40 WALL STREET CONTINUES...

WE WOULD LIKE TO THANK THESE TENANTS AND BROKERSWHO HAVE LEASED OVER 350,000 SQ. FT.

For more information please contact:Jeffrey A. Lichtenberg • Special Consultant to the Owner • 516.314.4458

Adam Foster 212.618.7088 • [email protected] Gerla 212.618.7066 • [email protected]

Michael Higgins 212.618.7011 • [email protected] Rothkin 212.984.8192 • [email protected]

40WALLSTREET.COM

Solomon Blum Heymann LLPJohn Moran, Adam Leshowitz, Newmark Knight Frank

XcitekSolutionsPlusRichard Levine, Michael Rizzo, CB Richard Ellis

HAKS Engineers and Land Surveyors Mark Shapses, Cushman & Wakefield

Telstra IncorporatedRobert Tanzmann, Cushman & Wakefield

Brokerage & Management CorporationJohn Johnson, Nicholas Farmakis, Studley

Core Staffing Services Mike Zaleski, Zaleski Properties

NYG Capital LLCAriel Cohen, Prudential Douglas Elliman

RRZ Management Inc.Ariel Cohen, Prudential Douglas Elliman

Managed Health Network Inc.Scott Panzer, Jones Lang LaSalle

Direct Access Partners LLC Ruth Colp-Haber, Wharton Property Advisors

GDS Publishing, Inc.Jared Freede, CB Richard Ellis

Spyker Consulting,Inc.Jared Freede, CB Richard Ellis

Infinitel Communications, Inc. Joseph Hilton, Grubb & Ellis

Accounting and Compliance InternationalWes Rudes, Richard Doolittle, Murray Hill Properties

XO Communications Services, Inc.Brian Reiver, Scott Cahaly, Jones Lang LaSalle

Zaremba Brownell & Brown PLLCDan Suozzi, Jones Lang LaSalle

Star Alliance Trading Group LLC Dan Suozzi, Jones Lang LaSalle

Country Wide Insurance CompanyMark Weiss, Newmark Knight Frank

Vertex Capital Management Dawn Frojen, Prudential Douglas Elliman

Clancy Financial Services, Inc. Oakwood Asset Management, LLC Rosen Greenberg Blaha LLP Rosabianca & Associates PLLC

WALL STREET PRESTIGE.

TRUMP ELEGANCE.

www.cbre.com


September 7, 2010 THE WEEKLY NEWSPAPER OF NEW YORK’S COMMERCIAL REAL ESTATE INDUSTRY $7.00

LEASE BEAT19 West 44th Street

90 John Street

THE SIT-DOWNDaniel Cogsville: The

Delicate Art of Distress

THE LEAD INDICATORSam Chandan Has

Jobs Market Warning

Tallest Order

Cushman & Wakefield's

Tara Stacom on Leasing Up One World Trade CenterBY JOTHAM SEDERSTROM

POWER BROKER

KAT

IE K

HO

UR

ISH

RAVA

N V

IDYA

RTH

I


212.594.2700 | slgreen.com


reach the people who own, manage, lease and sell

space in the city by advertising your deals

in the commercial observer.contact robyn Weiss, associate Publisher,

for more information: 212.407.9382 or

[email protected]


1133 Broadway 611 Art & Advisory LLC Kew Management The landlord was represented in-house.

1133 Broadway 498 Hudson Wigs Kew Management The landlord was represented in-house.

1133 Broadway 432 Hugo & Marie LLC Kew Management The landlord was represented in-house.

1133 Broadway 390 Kaerensa A. Craft LCSW Kew Management The landlord was represented in-house.

1133 Broadway 245 David Brian Brown Kew Management The landlord was represented in-house.

1133 Broadway 138 Carley J. Beardsley Kew Management The landlord was represented in-house.

490 Broadway n/a Trollbäck + Company

Deborah and Arthur Kaufman for Broad-way Landmark Cor-poration

Eric S. Cagner of Newmark Knight Frank represented the building owner.


Visit us at: www.observer.com/commercial



OFFICE PRODUCTSCERTIFIED WOMAN OWNED ENTERPRISE

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140 West 31st. Street, New York, NY 10001Between 6th and 7th Ave. (a Block from Penn Station)

After the sale, it’s the service that counts!

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575 Fifth Avenue 13,000 Guess n/a Robert K. Futterman & Associates brokered the deal.

24 East 21st Street 4,400 Al Mayass Noam Management Newmark Knight Frank represented the tenant in the 10-year deal. Sinvin Realty and JDF Realty repped the

landlord.

649 Ninth Avenue 2,606 Michael Guerrieri n/aJames Famularo of New York Commercial Realty Services represented the tenant in the 10-year deal. Cosmo Montemurro of Winick Realty repped the landlord.

106 East 23rd Street 2,400 Lomography Abington Holding Winick Realty Group’s Steven E. Baker and Michael Gleicher represented the landlord.

48 West 8th Street 1,350 Brentwood Pharmacy n/aJoseph Isa of Winick Realty Group represented the tenant in the 15-year deal. Gabe Whitman and Bill Abram-son of Buchbinder & Warren Realty Group repped the landlord.

740 Broadway 1,250 Financier Patisserie Lafayette-Astor As-soc. Winick Realty represented the tenant. Newmark Knight Frank repped the landlord.

762 Madison Avenue 1,208 Gallerie Aesthetique n/a Bertrand de Soultrait of New York Commercial Realty Services represented the tenant in the 10-year deal. Stuart Ellman of Judson Realty repped the landlord.

155 East 34th Street 1,200 Little J Cleaners155 East 34th Street LLC William Abramson of Buchbinder & Warren Realty Group represented the landlord in the 10-year deal.

2282 Broadway 743 Sprint 221 West 82nd Street Cosmo Montemurro of Winick Realty represented the tenant. Ami Ziff of Time Equities repped the landlord.



The Commercial Observer Classified

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32 Third Avenue 550 Thread Eyebrow Salon 115 E. 9th Street Re-tail LLP

Rafe Evans of Walker Malloy represented both landlord and tenant.

1 Union Square West 500 Monsoon Accessorize USA Inc.Union Square Asso-ciates LLC

Robin Abrams of Lansco Corp. and Simon Dallimore of Dallimore and Co. represented the tenant in the 10-year deal. William Abramson of Buchbinder & Warren Realty Group repped the landlord.

696 Lexington Avenue 400 Numero 28 Pizzeria n/a Robert K. Futterman & Associates represented the landlord.

188 Orchard Street 350 Dedegumo Watches n/aTim Parkkila of New York Commercial Realty Services represented the tenant in the five-year deal. Kelly Lin of Misrahi Realty repped the landlord.

2146 Nostrand Avenue (Brooklyn)

15,500 Dallas BBQ A&H Acquisitions Robert Greenstone of Greenstone Realty represented the tenant in the 20-year lease.

7602-10 Main Street (Queens)

14,000 TD Bank Zalkan Inc. Ripco Real Estate represented both landlord and tenant in the 20-year lease.

215 Water Street (Brooklyn) 3,200 Toll Brothers Inc. Pearl Street RealtyChris Havens of Creative Real Estate Group represented the tenant in the two-year deal. The landlord was repped in-house.


1. REBNY brokers are bound by a Code ofEthics that serves the client’s best interests.

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Congratulations to The Commercial Observer on its one year anniversary. Best wishes for continued success.

Stu_Obs.indd 1 9/13/10 11:24:36 AM

the commercial observer - sept. 14, 2010

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