TOP STORIES A-Rod Ad declines, exec and rent turmoil plague new rules –Greg David boss at Daily News says partial PAGE 2 decontrol ® is a disaster How GOP’s losses Page 11 could translate into more clout for leader Joe Bruno VOL. XXII, NO. 43 WWW.NEWYORKBUSINESS.COM OCTOBER 23-29, 2006 PRICE: $3.00 PAGE 3 Bloomberg’s top investigator 16 NY firms digs out corruption Elevating the in city government caught in THE INSIDER, PAGE 12 Hypochondria help; Guggenheim city burn centers New director brings focus options net underutilized HEALTH CARE, PAGE 17 back to flagship museum Revenue Service or a trip to a fed- Well-dressed exec during tough time for nonprofits Executives lose jobs, eral penitentiary. companies face “The fact that so many New from drug company BY CLAIRE WILSON York companies are involved taking over big penalties in shows just how prevalent backdat- at Liz Claiborne the solomon r. guggenheim museum’s anticipated backdating scandal ing was,” says Howard Silverblatt, face-lift gets under way in the spring. Happily, problems a market analyst at Standard & PAGE 33 with the structure of the iconic Frank Lloyd Wright build- Poor’s. “Every company I know of BY AARON ELSTEIN is doing some sort of investigation, ing are less serious than anticipated. The sprucing up will even if it hasn’t been disclosed.” BUSINESS LIVES cost just $27 million, money the institution already has in the stock option backdating The scandal gained force two the bank. RENTING–FOR NOW scandal sweeping Silicon Valley weeks ago, when Andrew Mc- For Director Lisa Dennison, the news came as a relief has ensnared more than a dozen Kelvey, the founder and chief ex- Would-be last month. She’s been dealing with the headaches associ- New York area companies. ecutive of Monster World- buyers ated with diagnosing the patient—including specially de- Five top executives wide Inc., resigned so he anxious have already lost their jobs, could devote his attention over signed scaffolding surrounding the famed museum—since 14% she stepped into the top job just over a year ago. and more will probably be OF OPTION to investigations by the market shown the door in the GRANTS U.S. Department of Justice can’t Replacing windows hasn’t been her only focus.The com- between 1996 coming weeks. A growing and 2005 were and the Securities and pull the ing restoration could serve as a metaphor for the tidying up number of companies are backdated Exchange Commission. A trigger she’s done in the executive offices during the year, which in- being forced to restate few days later, Kobi Alex- PAGE 31 See REFOCUSING on Page 27 years-old financial results and are ander, the former chief executive facing potential seven-figure pay- of Comverse Technology Inc., ments to regulators and aggrieved was charged with attempting to shareholders. Executives are bribe a witness who was on the AT DEADLINE scrambling to hire lawyers in at- verge of testifying about the com- tempts to ward off the Internal See NY FIRMS on Page 30 WALL STREET IS BOLSTERING ITS SUPPORT of Democratic candidates as the mid-term congressional elections near. Investment News reports in Wooing Heavy-hitter today’s edition that 51% of the campaign contributions made by securities firms so far during the 2006 election cycle of video on the Web went to Democrats, up from 48% in 2002, according to the are to sell now or keep growing the Center for Responsive Burgeoning indie value ourselves.” Politics. Within the financial holdout earns spot in So far, Heavy is opting to re- services sector, Wall Street’s main independent—at least until Democratic tilt is something young men’s hearts its own Google comes along,pock- of an anomaly. GOP candi- ets bulging with cash. And why dates have received 67% of not? Heavy’s revenues and its price insurance industry and 63% of BY AMANDA FUNG tag are soaring by the nanosecond. banking category donations. Now that YouTube has gone cor- google’s acquisition of money- porate, Heavy ranks as the largest EXECUTIVES FROM TAVERN ON SHAKING THINGS UP: losing video-sharing site YouTube independent video-entertainment THE GREEN are in talks to Guggenheim Director Lisa for $1.65 billion may have opened See WOOING on Page 30 launch restaurants in Las Dennison has restructured the people’s eyes to the outra- Vegas and Atlantic City.The development department and geous prices that buyers will plans to add curators. first Tavern outside of pay to get their hands on the See AT DEADLINE on Page 2 latest Web phenoms. But

buck ennis that’s old news at Heavy. The Manhattan-based video Web site has been fend- COMINGNEXT WEEK ing off suitors for months. A report on the BUSINESS OF LAW “We get approached explores how President Bush has been weekly by companies of all good to the ACLU’s ledger. Also, why sizes,”says David Carson,co- firms feel pressure in good times. founder and co-chief execu-

NEWSPAPER tive of Heavy. “Our choices PLAYING THE HEAVY: The site draws 12 million viewers. AT DEADLINE

Continued from Page 1 head of Citigroup’s global Manhattan will open in equities division; Robert Moore, December in Wellington, Fla. who led the bank’s U.S. equities Chief Operating Officer division; and Billy Heinzerling, Michael Desiderio, who is who oversaw the global prime spearheading the expansion brokerage and stock lending effort, says he is also interested teams.The firm subleased 8,900 in starting establishments in square feet at 52 Vanderbilt New Orleans, Hawaii and Japan. Ave., at East 45th Street. Cushman & Wakefield Inc. NEW YORK CITY’S FIRST CHINA represented the tenant and TRADE MART will open in June. GVA Williams represented Grandland New York Expo accounting firm Marks Paneth Center, a Fujian-based & Shron, which holds the lease. company, purchased a 120,000- square-foot building in East DIVERSION MEDIA TODAY Elmhurst, Queens, to house LAUNCHES TRAVELISTIC.COM, a approximately 200 merchandise Web site featuring 1,000 videos showrooms and provide support of travel destinations around the services for wholesalers. world. Most of the videos are Grandland, which was recruited clips of licensed programming by the New York City from broadcast and cable Economic Development Corp., television networks. Diversion, a is set to begin construction on Manhattan startup launched MARC KRAMER says the $46 million project in the last year, spent $1 million to the Daily News is doing next month.The trade mart is create the site. Diversion better than most other expected to create 700 jobs. was founded by Nicholas newspapers. Butterworth, former chief

MORTGAGE DELINQUENCIES IN executive of MTV’s online buck ennis THE NEW YORK AREA rose music network. through Sept. 30 this year to 2.08% from 1.82% of all loans at THE RESULTS ARE IN ON 2006 the start of 2006, according to a MAGAZINE GROWTH, and shelter report from Equifax and titles were the year’s fastest- Moody’s Economy.com. On growing category, according to ‘Daily News’ pressed Long Island, 2.68% of the new edition of The National mortgages were in default.The Directory of Magazines. Mirror- national average is 2.33%. ing the real estate boom of re- New chief achieves mixed results in tough market cent years, the number of maga- THREE FORMER CITIGROUP zines focusing on the home EXECUTIVES have leased office increased to 210 titles, or a 90% BY MATTHEW FLAMM space near Grand Central for a gain over 2005.The biggest new corporate advisory firm. losers were the lifestyle category, when newspaper circulation figures come out next Monday from the Audit Bureau of The principals of the firm, which declined by 40%; enter- Circulations, the Daily News will defy the nationwide downward trend and report a slight CapRio Administration, are tainment, down by 39%; and increase in its numbers.That’s the good news. Robert DiFazio, who was co- general interest, down by 37%. ■ The bad news is that advertising revenue for New York’s hometown paper is down 4% through August, according to TNS Media Intelligence. Even more troubling, ad revenue for CORRECTION archrival the New York Post rose 5%, continuing an upward trend. The Crain’s list of the area’s largest construction companies in the Oct. 16 issue incorrectly The News still collects close to double the ad revenue of the Post. Even so, for News Chief identified 2005 companywide revenues as 2006 companywide revenues. Executive Marc Kramer, those numbers have to hurt.The longtime newspaper executive, who left The New York Times in January to join the tabloid street fight, has launched borough THIS WEEK IN CRAIN’S See DAILY NEWS on Page 29 33 REAL ESTATE DEALS------8 GREG DAVID ------11

THE INSIDER------12 Schools reach overseas to

WEEK IN REVIEW ------14 sizes across the city are racing to opportunity to study abroad. An- NEIGHBORHOOD Colleges go abroad build facilities overseas, create joint other incentive is the need to reach amid security fears ventures with foreign schools out to a broader market in an era JOURNAL------16 abroad, and expand long-running when security concerns have made it REPORT: at home; foreign student and faculty exchange pro- more difficult for foreigners to come rivals seize chance grams to locations ranging from In- here to study. HEALTH CARE------17 dia to Ghana. While local schools have long Eroding numbers SMALL BUSINESS ------25 BY SAMANTHA MARSHALL had some international presence, until the terrorist attacks of Sept. THE WEEKS AHEAD ------26 many academics say the current ex- 11, the city annually hosted an new york university’s name will pansions are unprecedented, with ever-increasing number of foreign CLASSIFIEDS ------28 soon be a misnomer. Early this some institutions even creating students. But since then, a combi- month, NYU President John Sex- whole departments to oversee the nation of stricter U.S. visa require- BUSINESS LIVES------31 ton flew to Paris to discuss plans for effort. ments and stronger competition CORPORATE LADDER------33 a satellite campus in the French cap- “We connect to the world for our from schools in places such as Aus- ital.That move came weeks after the survival,” says Paul Anderer, who tralia, New Zealand and England EXECUTIVE MOVES------34 35 opening of an NYU Law School was tapped to be vice provost of Co- has cut into those totals. Last year, BOB LAPE ------35 program at the National University lumbia University’s new depart- foreign enrollment in New York of Singapore and a campus in ment of international relations in state colleges continued to ebb, vol. xxii, no. 43, october 23, 2006—Crain’s New York Business (issn 8756-789x) is pub- lished weekly by Crain Communications Inc., 711 Third Ave., New York, NY 10017. Period- Shanghai for an undergraduate July.“Universities like mine breathe falling more than 2% from the level icals postage paid at New York, N.Y. and additional mailing offices. Postmaster: Send address study abroad program. ideas, and we’ll only breathe deeply of the previous year to 61,994, ac- changes to: Crain’s New York Business, Circulation Department, 1155 Gratiot Avenue, Detroit, MI 48207-2912. for subscriber service: Call (888) 909-9111. Fax (313) 446-6777.$3.00 a In stretching its wings abroad, if our ideas come from everywhere.” cording to the Institute of Interna- copy, $59.79 one year, $109.79 two years. (GST No. 13676-0444-RT) ©Entire contents NYU is far from alone. During the The international push comes in tional Education. copyright 2006 by Crain Communications Inc. All rights reserved. last few years, higher education has response to growing demand from “The stream is drying up a bit, so become a hot export. Schools of all students in the United States for the a foothold abroad is necessary for

2 | Crain’s New York Business | October 23, 2006 Bruno:odd man in Hudson Senate leader set “My style is to get it out there on landfill the table, to be transparent and to TRIPLE PLAY to gain power of no come to some resolution,” he says. “My style is that government is the The Nov. 7 elections could reshape the political power lines in Albany. as sole GOP leader art of compromise.” mulled after Nov. 7 election Most insiders believe that Nov.7 NOW NEXT YEAR? will bring not only a victory for Mr. Spitzer,but also the election of An- Battery Park boss BY ANNE MICHAUD drew Cuomo as attorney general and the re-election of state Comp- would add 50 acres in any otherpolitical situation,it’s troller Alan Hevesi. While a Dem- for housing units good to be in the majority.But not if ocratic sweep could theoretically you’re one of Albany’s famed “three cost Mr. Bruno his Senate majori- men in a room”: the governor and ty, most think that he will hold on BY ANNE MICHAUD the two legislative leaders who ef- to it, making him the last statewide fectively control state government. Republican leader standing. Sheldon Silver Joseph Bruno the chairman of the Battery Park For the past 12 years, much of City Authority hopes to fill in the power in that room has been Top of the heap 50 acres of the Hudson River, ex- held by Assembly Speaker Sheldon “joe bruno is it,” says Evan Sta- panding the successful lower Man- Silver,the odd man out.As the lone visky, a Democratic political con- hattan community to add afford- Democrat negotiating legislative sultant and lobbyist. “He’s going to able housing. and budget items with Gov.George be the single most relevant Repub- James Gill,the authority’s chair- Pataki and state Senate Majority lican figure statewide.” man, wants to replace a small inlet Leader Joseph Bru- Mr. Bruno, 77, called South Cove with clean silt no, Mr. Silver has was first elected to that is periodically dredged from won clout by block- ‘He’s going to the state Senate in George Pataki Eliot Spitzer New York Harbor. bloomberg newsbloomberg ing Republican ini- 1976 and has newsbloomberg He admits ap images that the idea sounds tiatives—as he did be the single served as majority far-fetched, but he points out that last week when he leader for 11 years. expansion is the key to more rev- derailed Mr. Pata- most relevant Before that, he was enue for the city. Battery Park City ki’s effort to push a businessman and has been a treasure trove for tax cof- ahead on a $900 Republican served in the Kore- fers, turning over $130 million this million plan to ex- an War. He and his year to the city. pand Pennsylvania statewide’ wife, who have “Gov. [George] Pataki has not Station. four children, live expressed great in- In January, after in Brunswick in terest, but after the Joseph Bruno Sheldon Silver $130M next month’s likely Rensselaer County; gettyimages first of the year, I AMOUNT that election of Demo- each of the county’s want to present it to Battery Park crat Eliot Spitzer as 14 towns and two the new governor,” City is turning governor, Mr. Bruno may trade cities has a building named for him. his or her seat in the election,and he During Mr. Bruno’s first year as Mr. Gill says. over to NYC in places with Mr.Silver.While it may Politically,the only cloud on the scoffs at the idea of a coup attempt. leader, he forced through a bill that He would need taxes this year seem counterintuitive, his power horizon is the possibility that his “Whatever happens, I expect to would have required both parents state approval as and status are about to increase. majority will be narrowed in the up- have the support of the majority of to give permission in order for a girl well as that of city officials, the fed- “The power to say ‘no’ is the coming election. If his 35-27 ratio the conference,”he says.“And when under 16 to have an abortion. The eral government and the U.S. Coast most important power,” says one erodes by more than one seat,insid- you have the majority, then you Assembly never passed the meas- Guard. Albany lobbyist. “The governor ers say,he could face a coup attempt have the entire conference.” ure, and it died. The district’s City Council rep- and the speaker will have to figure from popular Sen. Dean Skelos, Compare that single-minded resentative, Alan Gerson, says the out how to get Joe to sign off.” R-Nassau, or Sen.Thomas Libous, Shifting to the left conservative stance with Mr. Bru- idea would rob Battery Park City of Mr.Bruno says he plans to wield R-Binghamton. he has maintained a firm grip on no’s position today. He has estab- the very thing that makes it spe- his power in an entirely different Mr. Bruno predicts that every his majority since 1995, in part by lished longtime relationships with cial—its proximity and access to the fashion than Mr. Silver does. member of his conference will hold moving his party to the center. See BRUNO on Page 26 water. “Filling and building on South Cove is on the order of proposing housing in the middle of Central ness schools in Belgium, Spain Park,” he says. and Ireland. This academic promote growth year, students from the four Environmental objections schools will spend an entire mr. gill believes he can address ex- term taking courses that are pected opposition from environ- business,” says Yaw Nyarko, NYU’s ploring similar opportunities specialties of each country. mentalists. He is said to be close to vice provost for globalization. in India. NYU has long led local in- Robert Kennedy Jr.and his environ- In fact, most colleges are focus- Some of the area’s smaller stitutions in establishing out- mental organization, Riverkeeper. ing their overseas expansion efforts schools are going global, too. posts in Madrid, Florence and Mr. Gill is also working on tak- on East Asia and India, areas that In a joint venture,Pace Univer- London. In recent years, it has ing over Pier A, which juts into the have seen some of the sharpest sity plans to have an environ- expanded on that base by Hudson at the southern end of Bat- falloffs in the last five years—and mental law program with adding facilities in Shanghai, tery Park City. may bring some of the hottest op- Shanghai’s Jiao Tong Univer- Prague and Ghana. He says that he is in talks with portunities. sity up and running in the next The annual cost—at least city officials and with the lease- “China is definitely on a front academic year. $2 million for a small location holder of Pier A, lawyer William burner of our awareness,” says Co- Even the John Jay College with 50 students—is hefty, but Wachtel, about buying the 120- lumbia’s Mr. Anderer, who is ac- of Criminal Justice, known PAUL ANDERER the investment is paying off. year-old pier. It would become the wants to build a tively exploring opportunities to mostly as “the school for cops,” physical presence About 1,500 NYU students home of New York Harbor ferries build a physical presence there in is seeking fresh ways to con- for Columbia studying here opt to do a se- and would be refurbished to in- partnership with other schools. nect overseas. Several years University in China. mester abroad each year.That’s clude a restaurant and possibly a

Meanwhile, Columbia is pro- ago, it launched an inter- buck ennis triple the number from four museum. ceeding on other fronts. In June, its national criminal justice ma- years ago. In the meantime, the City officials and Mr. Wachtel business school launched student jor.School administrators are mull- Peggy Blumenthal, executive vice far-flung outposts are raising NYU’s have been at odds over Pier A,which exchange programs with Peking ing other ways to branch out into president of the IIE, who recently profile in those countries and may the lawyer had hoped to revive as a University in Beijing and Fudan the world. spoke at an international education ultimately attract students from private transportation center. University in Shanghai. That fol- conference at the school. those countries to New York. Mr. Wachtel is part owner of the lowed last year’s launch of a non- Crime pays Fordham University,meanwhile, “When we go overseas, we real- New York Waterway ferry service degree program for financial ex- “with crime going international, is launching a globally integrated ly set up shop,” says Mr. Nyarko. operation. ecutives at Fudan by Columbia they recognize they have to engage M.B.A. program that it calls The Business School, which is now ex- with the rest of the world,” says Gateway,in collaboration with busi- COMMENTS? [email protected] COMMENTS? [email protected]

October 23, 2006 | Crain’s New York Business | 3 IN THE MARKETS HIGHLIGHTS REEL After big growth, Knight +0.4% looks likely to stagnate The Bloomberg/ $3.8 billion for the third quarter. The company’s business is split among Crain’s New Financial services firm’s The inflow will probably decline next global capital markets, which accounts for York Index hedge funds, trading year, as the business returns to more nor- about 75% of pretax operating earnings; rose 0.4% mal growth rates. asset management, to end the seen as slowing down Knight’s business which brings in 21%; week at ➡ of trading stocks for and its corporate seg- 349. The S&P 500 clients soared this year, ment, which brings in BY TOM FREDRICKSON as hedge funds and 4% and includes Index rose $25 0.2%, others poured in lots of Knight’s investments. ast week, Knight Capital cash. Now that busi- The impressive closing at 20 1369. Group Inc. uncorked num- ness looks like it will growth of recent years bers that turned heads on slow, too. Worse, the has been spearheaded Wall Street. Paced by the deceleration comes at 15 by Chief Executive strong performance of its a time of mounting Tom Joyce, who RISERS Lhedge funds,the company’s third-quarter competition. 10 helped polish a gem 5-DAY 1-MONTH 3-MONTH CLOSING earnings handily topped estimates, put- In September, Knight had acquired % CHANGE % CHANGE % CHANGE PRICE ting the stock into a 3% climb for the Knight’s market share 5 in 2000—Deephaven. Value Line +12.4% +10.8% +24.3% $50.95 week. Over the last 12 months, shares are of Nasdaq- and In addition, he has up 120%. NYSE-listed stocks 0 tried to steer Knight OSI Pharmaceuticals +9.8% +8.9% +30.2% $40.49 That fantastic rise looks like it is run- declined to 6.7%.That 10/21/05 10/20/06 toward trading ser- McGraw-Hill +8.4% +12.0% +27.3% $63.10 ning out of gas for the Jersey City-based is down from 10.6% in vices for big institu- Market cap $2 billion JetBlue Airways +7.7% +7.0% -5.9% $10.92 company. Investors should steer clear. September 2005, ac- tions and away from its reliance on fickle, A&P +6.0% +19.0% +22.8% $27.78 Knight has long acted as a middleman cording to Sandler Trailing 12 months P/E 13.7 on small-cap stock trades, executing O’Neill & Partners. online retail investors. Assets under mgmt. $3.8 billion trades for broker-dealers and institution- Knight has recently Those moves,along SINKERS al clients. In recent years, it has branched acquired a foreign-ex- with the firm’s reputa- 5-DAY 1-MONTH 3-MONTH CLOSING into hedge fund management and has change company and a tion as a leader in elec- % CHANGE % CHANGE % CHANGE PRICE benefited hugely. Knight’s sizzler has electronic fixed-income trading firm, but tronic trading platforms, have helped to Lazard -7.2% -2.6% +7.4% $38.70 been its Deephaven Capital Manage- it will take time for those newly purchased power the rise of Knight’s shares. But Scientific Games -6.5% -7.1% -17.0% $28.86 ment hedge fund business, which pulled units to be built up to a meaningful scale. now,with prices at 16 times this year’s an- in more than $500 million of fresh mon- For 2006, analysts expect Knight to ticipated per share earnings—well above Jefferies Group -5.9% +6.4% +17.3% $29.43 ey from investors in the third quarter earn $1.19 per share, up a whopping 90% other financial firms’—Knight looks like Take-Two Interactive -5.7% -0.3% +42.6% $14.96 alone, according to CIBC World Mar- from the 62 cents per share the company it has run out of headroom. Astoria Financial -5.3% -6.5% -2.5% $29.58 kets. That brought Deephaven’s total, earned in 2005. Sales are expected to in- spread across its several hedge funds, to crease 39% to $883 million. COMMENTS? [email protected]

It Starts with Hello STOCKS TO WATCH Nasdaq posts gains from own merger A NY Manufacturer Management buyout in week that brings big tie-up in Chicago A NY Manufacturer of and supplier of of a NY Distributor Thermoplastic Products Industrial Lumber WHILE THE TWO BIG CHICAGO futures of Office Furniture markets made headlines last week by $6,000,000 and Fasteners $4,000,000 agreeing to a huge merger, Nasdaq Line of Credit $3,850,000 made news of its own, posting block- Line of Credit Line of Credit buster results. The exchange reported a 70% jump in third-quarter income, thanks largely to the cost-cutting that A Distributor of Custom Designer/Importer followed last year’s acquisition of electronic market INET. Nasdaq is Metal Casings A Law Firm of Ceramic Housewares expected to rejoin the exchange- has obtained a has obtained a has obtained a consolidation game by upping its $3,000,000 $1,000,000 $6,000,000 stake in the London Stock Exchange. Line of Credit Line of Credit Working Capital Facility Executives at Dow Jones can be forgiven for feeling a bit frustrated. Last week, & Term Loan including Letters of Credit they not only handily beat analysts’ estimates by reporting quarterly earnings of 19 cents a share, but they also announced that the company would take At Sterling, we understand that great deals start with Hello. full control of the Factiva news database service, buying out their partner, For the personal service you deserve call Reuters. Despite those glad tidings, investors pushed DJ’s shares down 1%, even as the company’s famed Industrial Index set another record. Ted Poor Jeffrey Fliegel Has fashion trumped the financials at Senior VP - Asset Based Lending Senior VP - Middle Market Banking Martha Stewart Living Omnimedia? 212.575.3473 212.575.4448 The company has lost money in seven [email protected] [email protected] of the last eight quarters, yet its shares have turned in a stellar performance in recent days, soaring 16% in the last week alone. Next week, the company is expected to announce a quarterly loss of 18 cents a share. In Martha’s defense, at least 500 Seventh Avenue, New York, NY 10018 • www.SterlingNationalBank.com the company’s losses have narrowed over the last year. Our Doors Are Open All The Way To The Top | Est. 1929 • NYSE: STL • Member FDIC

4 | Crain’s New York Business | October 23, 2006 A Business Card that earns free fl ights on JetBlue? Now,that's a departure.

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1. You will receive double Award Dollars on purchases of wireless telephone services, automobile gasoline, car rentals, offi ce supplies and equipment and JetBlue fl ights, in each case not purchased at warehouse clubs, superstores or supermarkets. 2. 5% savings, which will appear as separate statement credits of 3% and 2%, is valid on air-only travel purchased directly from JetBlue reservations at 1-800-JETBLUE or www.jetblue.com. JetBlue Business Card accounts will receive a maximum annual savings of $2,000 per Card account. 3. The expiration date of all TrueBlue points in your TrueBlue Membership Account will be extended to be one year from any date you have a TrueBlue point credited to your TrueBlue Membership Account from one of the following activities: (1) Using your JetBlue Business Card Account for eligible purchases or (2) The primary account holder fl ying a JetBlue fl ight segment that is paid for with your JetBlue Business Card Account. Eligibility and timing are based upon the date the TrueBlue point is credited to your TrueBlue Membership Account from one of the above qualifying activities. 4. The $50 statement credit applies to the fi rst eligible purchase made between 7/1/06 and 7/1/07. The maximum discount available is $50 per account. 5. Customer is responsible for government taxes and fees that may apply to Award Travel. JetBlue Cardmember Agreement and TrueBlue Terms and Conditions apply. ©2006 American Express Company. NEW YORK,NEW YORK edited by Valerie Block October 23-29

with The Nation’s politics, Rock muse turns storyteller produced the issue in New York, hiring name writers like Susan he woman who inspired rock icons Cheever and Bruce Fierstein.The George Harrison and Eric Clapton—and year-old indie title also just struck their classic songs “Something” and a distribution deal with Ingram T Periodicals. “Layla”—will soon tell her own story. Founder Mark North says he Former model and magazine cover girl wants Old Trout, which has Pattie Boyd (right), who dumped Mr. circulation of 10,000 copies, to Harrison to marry Mr. Clapton, has struck a grow into something like The Onion.The model he doesn’t six-figure deal with a major New York want to copy is George, John publisher for a memoir about her life as a Kennedy Jr.’s failed title. “The last muse, according to industry sources. Ms. Boyd thing we’re going to do is get sold rights to the memoir in Britain last July. fancy Manhattan offices,” he says. Mr. North is keeping his The U.S. publisher has kept the sale so tightly annual investment in the title in under wraps that not even the losing bidders the low six figures, though he is know who got the book here. William Morris considering a long-term stay in agent Dorian Karchmar, who made the deal, New York. “Judging by the audience for Jon Stewart, there’s a declined to comment. gettyimages market out there for this,” says According to London newspapers, Ms. David Wallis, who edited the issue Boyd was inspired to write her book when the with Stanley Mieses. formerly drug-addled Mr. Clapton began asking for her help in remembering events from 20 years ago. Director talks Mr. Clapton is penning a memoir for Random House that as trendy eat is due out next year.The Daily Mail reported that Ms. Boyd’s at the head of three long tables book will “dish the dirt about the sex, drugs and infidelities in at the Soho House lined with her relationships with both the legends.” trendy intellectuals feasting on mounds of prosciutto, mushroom to 6 p.m. outside Penn Station risotto and rare roast beef, Harold New teen newser and Grand Central Terminal, in Evans, Week editor at large, Times Square and in several other interviewed Hollywood director in mom’s image locations. A cart will even hit the Sydney Pollack for one of the teen kids news gets an addition meatpacking district in the wee magazine’s frequently held Weiser is pleased to announce that to its lineup of star progeny on hours to satisfy hungry clubgoers. “conversations.”The two chatted Sunday. Gabriel Cohen,son of The Garden’s hot dog supplier, about the director’s experiences Today’s Meredith Vieira, comes to the Sabrett, is providing 50,000 franks working with Dustin Hoffman and program as a sportscaster. He joins Stanley Kubrick and the state of the Jenna Ruggiero, daughter of Fox 5 industry today. Mitchell J. News’ Rosanna Scotto; Samantha The director of Tootsie, Absence Perelman, offspring of mogul Ron of Malice, The Way We Were and Mertz Perelman; and Haley Cohen, other classic films shared his joins the firm as partner. daughter of CNN’s Paula Zahn. career surprises (“I thought Tootsie The 15-year old newcomer istockphoto would be a disaster; I didn’t think replaces Cody Gifford, Kathie Lee (which go for $5 a pop inside the anyone would believe Dustin was and Frank’s son, who’s too busy arena) for the promotion. a woman”), his insights New York City 135 West 50th Street Mr. Mertz possesses more than 30 years with his high school football team The documentary is part of a (“Directors are territorial, like to tape the show. larger effort to expand the lions; they pee on the corners of New York, NY 10020 of experience providing accounting Tel 212.812.7000 “Gabriel is a true sports fan. network’s programming beyond the set”) and his views on success Fax 212.375.6888 services to public and private companies, He really wants to be in the Knicks and Rangers games. “We (“It remains a mystery what will Long Island particularly manufacturers, distributors, business, as opposed to some of want to broaden our audience and be a box-office hit. It’s always a 3000 Marcus Avenue the other kids who are just doing be known for much more,” than surprise”). ■ Lake Success, NY 11042 service organizations, hedge funds, and it,” says producer Al Primo,a games, says Steve Mars, vice Tel 516.488.1200 mortgage companies. Mr. Mertz serves as Fax 516.488.1238 veteran news consultant. “He president of MSG Media. On chairman of the SEC Practice Committee Westchester comes very prepared.” Oct. 5, the network changed its LEFT-LEANING 660 White Plains Road of the New York State Society of Certified Teen Kids News, which moved on-air and online look by Tarrytown, NY 10591 FORGET GREEN INVESTING; now Public Accountants and possesses to Fox 5 in September, is seen in introducing a new logo and new Tel 914.333.0555 New York on Sundays at 11 a.m. graphics. there’s The Blue Fund from Blue Fax 914.333.0556 significant experience with the Securities Investment Management. The New Jersey and Exchange Commission reporting fund lets investors buy into com- 399 Thornall Street panies considered politically Edison, NJ 08837 requirements and Sarbanes-Oxley Cable channel SF magazine Tel 732.549.2800 correct (by progressives, that is). Fax 732.549.2898 compliance. puts on the dogs cracks up NY New York firms in the fund

www.weiserLLP.com msg network hopes that a mock obituary for Ann Coulter include: thousands of free hot dogs will and a cover story on the 13 Colgate-Palmolive whet New Yorkers’ appetite for scariest Americans, including For additional information, The Fifty Greatest Moments at Sen. Sam Brownback of Kansas, E*Trade Madison Square Garden,a new will greet readers of Old Trout contact Mitchell J. Mertz, CPA Estée Lauder at 212.375.6750. or 10-part documentary the cable when it hits newsstands in time Weiser LLP channel will begin airing on for Halloween. [email protected] Lehman Brothers Certified Public Accountants Oct. 31. The guest editors of the San Wiener stands will appear Francisco-based bimonthly, which North Fork Bank each day this week from 12 p.m. combines Jon Stewart-style humor

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Parisian company Law firm stocking up on office space lights fire in NYC diptyque’s products have been 298,000 square feet on floors 26 year, the firm made a deal that will represented the law firm. hot in New York specialty stores for O’Melveny signs through 34 through the year 2024, give it access to the entire 35th floor As part of the lease agreement, years, and now the Paris-based can- for two more floors has signed another long-term lease after the current tenants’ leases ex- O’Melveny & Myers will also take dle maker aims to open its own store for an additional 57,000 square feet, pire in the second quarter of 2009. possession of a 2,500-square-foot in the city. in 2 Times Sq.; candle or the entire 36th and 37th floors. “O’Melveny is growing in New fitness center that was built by the The company, which sells scent- maker warms to NY The asking rent in the fully leased York and it’s vital for us to have all of current tenant, Clarendon Nation- ed candles that retail for at least $50 building,at the corner of West 42nd our lawyers and staff in one location,” al Insurance Co. Clarendon is relo- apiece, is looking for suitable space aw firm O’Melveny & Street and Broadway, was $85 a says Gerard Cruse,a managing direc- cating its employees to two Man- in SoHo and above 59th Street with Myers is gobbling up all square foot. tor at O’Melveny & Myers. hattan locations, according to an eye toward opening two stores in the space it can get at its O’Melveny will take possession “The attractive thing about this Bruce Rothman,a managing direc- the next year, says Jennifer Puckett, New York office build- of the new space in early 2007, but deal is that the space was contigu- tor at Studley, which represented a managing director at Diptyque. ing at 7 Times Square. may sublease it to another tenant ous,” says Lisa Kiell, a managing di- Clarendon. The candle company operates LThe firm, which already leases until the firm needs to expand. Last rector at Jones Lang LaSalle, which —julie satow shops in Paris,Boston and San Fran- cisco. Several New York specialty stores, such as Bergdorf Goodman and Jeffrey, car- ry the scented candle line. In New York, Diptyque took its first step by signing a five-year lease for a 3,000- square-foot showroom at 11 E. 26th St.,be- A Diptyque candle. tween Madison and Fifth avenues. The space will be Diptyque’s U.S. headquarters. Adams & Co. represented both the tenant and property owner East 26th Associates in the deal.The ask- ing rent was $41 per square foot, a little higher than the neighborhood average.“Prices in the Flatiron [dis- trict] have gone up dramatically in the last six months because there’s such a demand for space,” says Daniel Wolpert, an Adams broker who worked on the deal. —elisabeth butler Covenant House moving uptown covenant house, the largest pri- vately funded child care agency in the country,has sold its iconic build- ing in Chelsea and is moving its in- ternational headquarters uptown. The nonprofit, which provides shelter and services to homeless and runaway youths, has sold its 11-sto- ry building at 346 W. 17th St.— Oxford. Health care coverage that comes fully loaded. once the National Maritime Union Building—in a deal that is expected to close in early 2007. Covenant House plans to move into 40,000 square feet at 5 Penn Plaza,on Eighth Avenue between West 33rd and What sets an Oxford product apart from the ordinary are the little extras – as well as the big extras. Starting West 34th streets, in March. The with the large number of plan designs we offer to help meet the needs of your business. And our localized asking rent is $40 a square foot. customer service. You’ll notice our strong relationships with local physicians and hospitals, in addition to “The 17th Street site was not the most efficient setup,”says Arthur Mi- a renowned national network. We have an intelligent approach to medical management that helps keep our rante,president of global client devel- members healthy, while also helping to keep costs down. There’s also our popular and practical wellness opment at Cushman & Wakefield programs, where our members get extras like discounts on gym memberships. At UnitedHealthcare, we’re Inc., which represented Covenant House. The agency had considered proud to be able to offer Oxford products to you. To fi nd out more about what makes Oxford right for locations in Queens, Brooklyn and your business, call your broker. Or call 800-642-6877, or go to uhctoday.com/oxfordhealth. Jersey City. “The other locations weren’t much cheaper when you in- cluded transportation costs of em- ployees and visitors,” he says. The new offices, which will in- clude a call center for Covenant House’s 24-hour hot line, are also close to the agency’s facility at 460 W. 41st St., which houses at-risk © 2006 United HealthCare Services, Inc. Insurance coverage provided by or through United HealthCare Insurance Company of New York. Oxford’s HMO products are underwritten by children. CB Richard Ellis repre- Oxford Health Plans (NY), Inc., Oxford Health Plans (NJ), Inc. and Oxford Health Plans (CT), Inc. and Oxford’s insurance products are underwritten by Oxford Health Insurance, Inc. sented the landlord. —julie satow

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Bank of America, N.A. Member FDIC. © 2006 Bank of America Corporation. All rights reserved. VIEWPOINT Workers’ comp opportunity editor in chief Rance Crain vice president, publishing director or all the back-and-forth in the more interested in their finances than in their patients. Alair Townsend recent debates between gubernatorial The most crucial problem stems from claims involving publisher Jill Kaplan candidates John Faso and Eliot Spitzer, the what’s known as a permanent partial disability. Virtually all EDITORIAL most important statement in the governor’s states limit benefits in such cases; many impose objective editor Greg David managing editor Richard Barbieri race may have come a month earlier. At a standards when assessing claims. New York does neither. projects editor Cynthia Rigg meeting of the Business Council of New The result is that a minority of injured workers win overly deputy managing editors Valerie Block, Erik Ipsen York State, Mr. Spitzer endorsed the idea generous payments, and all parties involved get saddled with senior reporters Aaron Elstein, that the state’s badly flawed workers’ compensation system big legal bills.The numbers are startling: A mere 15% of cases Lisa Fickenscher, Matthew Flamm, needs fundamental reform. If he’s serious—and if he’s eat up some 75% of all Tom Fredrickson, Samantha Marshall, F Anne Michaud, Miriam Kreinin Souccar elected governor on Nov. 7—New York’s economy may A big drag on the workers’ comp reporters Barbara Benson, Elisabeth Butler, receive an enormous lift.The boost could be particularly expenditures. Erik Engquist, Amanda Fung, Hilary Potkewitz, Julie Satow, Gale Scott noteworthy in depressed upstate regions. economy will If Albany were a restaurant critic Bob Lape The problems that must be fixed are long-standing and rational place, a art director Steven Krupinski vanish if Spitzer deputy art directors Carolyn McClain, result from the typical Albany gridlock. compromise would be Daniel Mednick The latest data show that the average workers’ comp delivers on reform simple: Increase the staff photographer Buck Ennis copy desk chief Wendy Zuckerman claim in the state is $16,114; that figure, up from $11,739 just benefits in return for copy editors Michele Arboit, Leslie Jay, three years ago, is the second-highest in the country and reforms. But no one has Thaddeus Rutkowski research editor Denise Southwood 86% above the U.S. average, according to data from the been willing to demand associate research editor National Council on Compensation Insurance. Average that business and labor Adrianne Pasquarelli www.NewYorkBusiness.com workers’ comp premiums in New York are 15% above the negotiate in good faith—certainly not Gov. George Pataki. online editor Catherine Tymkiw U.S. average, and many national manufacturers say their Nor has anyone pushed a compromise through the online reporter David Jones New York workers’ comp costs are their highest such Legislature despite recalcitrance on either side. EDITORIAL AND ADVERTISING OFFICES expenditures. Mr. Spitzer has taken the first step on that path by 711 Third Ave., New York, NY 10017-5806 editorial: 212.210.0277 Fax 212.210.0799 The money isn’t all going to injured workers: New York’s endorsing unspecified changes for permanent disability cases advertising: 212.210.0259 $400-per-week benefit, which has remained unchanged as well as increases in benefits, but only if premiums are Cable craincom nyk Fax 212.210.0499 since the early 1990s, is the lowest in the nation. Instead, reduced. If he delivers on his promise, one of the most Entire contents ©copyright 2006 Crain because New York’s system is excessively litigious, the money significant drags on the New York economy would be Communications Inc. All rights reserved. ®CityBusiness is a registered trademark of MCP is soaked up by lawyers, as well as by health care providers eliminated. Inc., used under license agreement.

TO SUBSCRIBE: Call 888.909.9111; fax 313.446.6777. $3.00 a copy, $59.79 one year, $109.79 two years. LETTERS TO THE EDITOR www.NewYorkBusiness.com ADVERTISING AND MARKETING advertising director Vanessa Cognard business development manager Robert N. Grossman The case for and against rent rules account executives Andrew Carlin, Holly A. McKeown, Derek Reese, Jennifer Siniscalchi, William E. Squitieri, MARKET-RATE APARTMENTS outstripped supply.The only Journal,” Crain’s, Oct. 9). this piece of Brooklyn’s glorious Brigitte Stieglitz STILL AN OPTION effective way we’ve found of As someone who grew up in the past, you can. western account manager keeping any semblance of a middle Brooklyn of the 1950s and 1960s, I dennis middlebrooks Ellen Mazen (Los Angeles) 323.370.2477 greg david’s Oct. 9 column class in this city—the linchpin of fondly recall the stately movie classified sales manager John Gallagher (“Keeping it real on rent any successful city—is to maintain, theaters across the borough. In newsletter product manager INFLATED PRICES’ Catherine Evans Gittens regulation”) doesn’t take into not eliminate, rent regulation. addition to the Kings, there were WIDER EFFECT sales coordinators Lulé Haznedari, account the unique nature of rent thomas g. lunke the Prospect and Saunders in Park Anita Perrino regulation in New York City. Urban planner Slope, the Clinton in Red Hook crain’s Oct. 2 story “Rising hotel credit Pat Grondziak 313.446.6082 Developers are not prevented from (where I saw Godzilla in 1958), the rates price visitors out’’ misses an marketing director MJ Snyder Metropolitan, Fox, Paramount and important issue. Inflated real marketing assistant Jill H. Bottomley COMPETITION LEADS Reginald Jordan TO LOWER RENTS Albee in downtown Brooklyn, the estate prices in New York City circulation manager Hamilton and Walker in Borough hurt New York’s appeal as a tourist internet director Marc Minardo it would be very interesting to Park, the Oriental and Marboro in destination in many ways. NEW YORK PRODUCTION read how much it costs to Bensonhurst, the Astor and Avalon Witness the closing of many production and pre-press director administer rent control and rent in Flatbush, and the Pitkin in off-Broadway theaters and Michael Corsi stabilization each year and to Bedford-Stuyvesant. performance venues over the past advertising production manager publish how much low-income All of these neighborhood few years. SoHo, once the center Suzanne Fleischman Wies bloomberg newsbloomberg housing could have been built! institutions have joined Ebbets of the world of fine arts, became a PUBLISHED BY CRAIN COMMUNICATIONS INC. RENT-REGULATED APARTMENTS Clearly, Greg David is Field in the mists of memory, shopping mall. chairman Keith E. Crain absolutely right—the more replaced by retail outlets, There is no doubt in my mind president Rance Crain housing produced, the greater the multiplexes or vacant hulks. I guess that New York was the greatest secretary Merrilee Crain building new apartments and supply.The more competition, the some call it progress. I call it a tragic city of the 20th century, but we are treasurer Mary Kay Crain charging market rates. In fact, lower the rents and the sales prices. loss of history and architecture. witnessing its decline. executive vp, operations William Morrow many are doing so now, creating earle s. altman Go, Marty! If anyone can save nathan metz senior vp, group publisher Gloria Scoby group vp, technology, circulation, our biggest building boom in Co-Chairman manufacturing Robert C. Adams years. Some even choose rent ABS Partners Real Estate vice president/production & regulation in order to be eligible manufacturing David Kamis for low-interest bond financing or WHAT’S COMING UP IN CRAIN’S? corporate circulation director LOEW’S KINGS THEATER Patrick Sheposh additional development rights. SHOULD BE SAVED Special Special report: Guide In addition, the laws of supply founder G.D. Crain Jr. (1885-1973) and demand in New York City real kudos to Brooklyn Borough report: the meetings and to Growing chairman Mrs. G.D. Crain Jr. (1911-1996) estate have never operated as President Marty Markowitz for his business of law conventions a Business simply as Mr. David suggests. For efforts to save the historic Loew’s Oct. 30 Nov. 6 Nov. 13 most of its history, demand has far Kings theater (“Neighborhood

10 | Crain’s New York Business | October 23, 2006 when the unit became vacant, or if the rent topped that figure and the tenant’s income was higher than $175,000 for two consecutive years. Landlords were given the ability to raise rents substantially if they ren- ovated apartments, and they started to do so in order to move units to the magic $2,000 threshold.The think- ing was that this would gradually shrink the rent-control system and erode political support for it. So far,surprisingly few units have been decontrolled—14,000 last year and 145,000 in the past decade. Owners give their attention only to the most desirable units, and rents soar when they come on the market. The total number of apartments affected by rent regulations has stayed remarkably steady, at around 1 million. New units come into the system, since any property receiving a tax abatement under the 421-a program is regulated—a situation john h.john howard that will continue,despite talk of re- forming 421-a. Although rents are high in these units, the tenants per- ceive an economic benefit and be- come committed to controls. What A-Rod’s pay Mr. Bruno’s calculation also has backfired in political terms. In Britain, Margaret Thatcher trans- says about rents formed the socialized housing sys- tem by selling millions of flats to their tenants.The new homeowners hen baseball players won the right to benefited enormously and flocked to her Conservative Party. In New free agency in the 1970s,union chief Marvin York,only landlords win with partial Miller showed he understood economics decontrol.All that most voters see is far better than the supposedly sophisticat- soaring housing costs, and their ed businesspeople running the teams did. fears have politicians clamoring to raise the threshold for deregulation. WOwners feared there would be chaos if all players negotiated Economists know that complete new contracts each year. Mr. Miller agreed to allow only a small decontrol would benefit the city enormously (Crain’s, Oct. 9). While number of free agents and bolstering political those living in regulated units would annually, because he support for controls. see their rents rise, the cost of mar- knew the laws of supply The story begins in ket-rate apartments would fall.The and demand. If supply 1997 when Senate Ma- overall increase could be modest. were restricted, teams jority Leader Joseph Turnover would accelerate,mak- would bid up salaries— Bruno vowed to end rent ing the system more efficient and which is exactly what regulation,at the behest freeing up large apartments for fami- has happened, making of real estate interests and lies. Landlords would gain incentives Yankees third baseman with the tacit support of to build and refurbish properties. We are pleased to announce Alex Rodriguez worth Gov. George Pataki. The supposed housing boom in New $25 million a year. The ensuing political York is impressive only in compari- The baseball example GREG storm was too intense son with the dismally low activity Part 24th, 25th and 26th fl oors, mirrors what is happen- DAVID for the two Republi- that the city experienced for decades. ing in New York’s rent- cans, so Mr. Bruno en- New Yorkers don’t want to accept 15,382 RSF, regulated housing mar- gineered a compromise. these truths, and what’s happening ket.Partial decontrol,enacted in the An apartment would be decon- today doesn’t give them any reason have been leased to late 1990s,has backfired,raising rents trolled if the rent exceeded $2,000 to re-evaluate their beliefs. ACUITY BRANDS LIGHTING

CRAIN’S ONLINE POLL Sloane Rhulen and Ben Cooley of WAS LYNNE STEWART’S PRISON SENTENCE APPROPRIATE? CB Richard Ellis represented the tenant MOST OF THE 725 RESPONDENTS to a 3% NewYorkBusiness.com poll believe civil Yes, but only . in this transaction. because of her No, she rights lawyer Lynne Stewart received too lit- health problems aided a tle prison time for violating federal law by terrorist, broke the helping client Sheik Omar Abdel-Rahman Yes, she .34% 63% overstepped the . law and communicate with supporters. The sheik boundaries of legal should have For leasing information please call: been given is serving a life sentence for plotting to representation, but Peter Turchin • 212.984.8364 • [email protected] she’s not a terrorist a longer bomb landmarks in the city. Ms. Stewart term Eric Deutsch • 212.984.8284 • [email protected] received a 28-month sentence. Jason Pollen • 212.984.6675 • [email protected] Zachary Freeman • 212.984.6609 • [email protected] For this week’s question: Go to www.NewYorkBusiness.com/poll to have your say. business environment and choice in education. He could lead the party through CORRUPTION HAWK DOI chief what some foresee as a dark period IT WASN’T BY CHANCE that the attorney, he offered the THE INSIDER of Democratic dominance in the Department of Investigation assemblywoman a deal if she would by Erik Engquist and Anne Michaud state. captured video of a Brooklyn help his own flagging probe of assemblywoman allegedly soliciting judicial corruption. Ms. Gordon a bribe last year. The seeds that led accepted, and months passed Lopez pushes to Diane Gordon’s arrest were before she reneged, freeing Ms. for tax reform planted two years earlier when a Hearn to publicly expose her. A Wal-Mart special group of city employees was lectured The 45-year-old investigations assemblyman Vito Lopez, about corruption, on the initiative of chief is not well-known, but she’s D-Brooklyn, is spearheading an DOI Commissioner Rose Gill Hearn produced results, recovering $22 at Manhattan Mall? effort to expand the 421-a tax (below). million from crooks so far. Ms. Hearn abatement program’s “exclusion al-mart opponents are In all, Ms. Hearn and her staff has boosted DOI staffing 30% by worried that the zone” citywide. Residential projects in the zone have informed nearly 50,000 getting funding from other agencies underperforming must include affordable housing to municipal workers that reporting in exchange for extra DOI scrutiny. W corruption is not only their civic duty This winter, she will install a special Manhattan Mall (left) could qualify for an abatement. Mr. become the site of the discounter’s Lopez opposes a modest expansion but also, under a unique city law, auditor to keep organized crime from of the zone proposed by the their legal obligation. One of those infiltrating the $1.7 billion Croton first store in New York City. Bloomberg administration, which newly enlightened workers came filtration plant project. It’s the first The building at Sixth Avenue says it would result in more forward with information that initiative of its kind at a city project. larry ford and West 33rd Street, which was gentrification outside the zone. ultimately led to the fabulously DOI now receives 1,000 tips a the city’s first vertical mall, has had trouble attracting and Mr. Lopez is reintroducing his successful sting on Ms. Gordon. month, up nearly 50% in 421-a reform bill in the Assembly, But Ms. Hearn, a former four years. But Ms. retaining anchor retailers. It offers 175,000 square feet of retail and Councilman John Liu, federal prosecutor, got a Hearn doesn’t pursue space, which is large enough for a Wal-Mart. Some even fear D-Queens, will introduce a humbling reminder of the every one. When that Wal-Mart might announce a move this week as part of its similar one in the city.The current limitations of the post to asked to investigate first analysts meeting in the New York area. abatement program expires next which she was appointed candidates for year. by Mayor Michael office, she tells Many retails experts, however, dismiss the idea.The mall is Bloomberg in 2002. politically 97% leased at rates of $100 to $250 per square foot, which When she handed motivated tipsters would be pricey for the discount retailer. “We’re not running a McLaughlin rap Ms. Gordon to call back after Kmart special on our retail space,” says Mark Teitelbaum, chief filters down over to the the election. Brooklyn “Nobody ever does,” operating officer of mall owner Argent Ventures.The mall’s the indictment of Assemblyman district she says. Class A office space is 96% leased. Brian McLaughlin, D-Queens, is a

blow to his likely successor, Rory ny post long-shot bid to become governor. Lancman, whose campaign GOP insiders see Mr. Faso is a skillful public speaker, publicized photos of him with ing Mr. McLaughlin, “I’ve never resistance from the National Park a role for Faso understands state government after Mr. McLaughlin even after the seen him do anything unethical or Service; Ms. Romer is apparently serving in the Assembly and incumbent’s office was raided by the inappropriate. My job right now is hoping that Mr. Blair can use his republican insiders are saying remains faithfully on-message FBI in a bid-rigging investigation. to be his friend and, as a candidate, influence with President George W. that John Faso would make a good about Republican values: lower Mr. Lancman noted in an e-mail to assure people in the district that Bush to persuade the park service to state party leader if he loses his taxes, less government, a better at the time that in 20 years of know- their next Assemblyman will share reconsider. Brian’s work ethic, his commitment Ms. Romer declines to to his constituents and his comment. The Governors Island commonsense approach to issues.” Preservation and Education Corp., Last week’s indictment alleges to which the New Globe Theater that Mr. McLaughlin stole group submitted a plan in May, has $2.2 million from taxpayers, asked all prospective developers union members and even the not to speak to the press. Crain’s Little League. reported last month that GIPEC MORE TONNAGE would be throwing out proposals New hope for the site and starting fresh. for bottle bill City officer makes supporters of the “Bigger Better Bottle Bill” say its chances of Albany connections becoming law would improve if insiders say that Deputy Mayor Eliot Spitzer were elected governor. Kevin Sheekey (below), more than The bill would extend the nickel deputy mayors past, is working deposit to noncarbonated hard to build relationships with beverages, but has failed repeatedly Albany legislators in an effort to in the Legislature because of push Mayor opposition from Senate Majority Michael Bloomberg’s Leader Joseph Bruno. agenda. The attorney general has Mr. Sheekey, publicly supported the bill, and who was named Blank Rome’s maritime Robert Moore, executive director of to his post in practice grows even stronger Environmental Advocates of New December at the with the addition of former York, believes Mr. Spitzer would start of the members of the international include it in his first budget mayor’s second ap images maritime firm Healy & Baillie. proposal. term, was responsible for the July shake-up that moved some new This follows our 2003 faces into the city’s lobbying jobs. Theater seeks help Top priorities on the mayor’s wish combination with the The Chrysler Building list are more education dollars from Washington, DC maritime 405 Lexington Avenue in high places the state and establishment of firm Dyer Ellis & Joseph. New York, NY 10174-0208 barbara romer, founder of an routine HIV testing. 212.885.5000 organization to build a new Globe Mr. Sheekey is also said to be Theater on Governors Island, is keeping an eye on who will wield said to be reaching out to British power in the governor’s office after www.BlankRome.com Prime Minister Tony Blair to advance Gov. George Pataki leaves. State her project.The plan to recreate funds account for 19% of the city’s Shakespeare’s theater-in-the-round $53 billion budget this fiscal year, at Castle Williams has met with or $10.1 billion. ■

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ECONOMIC SPOTLIGHT Cablevision raises Fox rate cablevision systems corp. agreed to triple the rate it pays News Corp. to carry Fox News on its cable TV systems. Payments are expected to average more than 75 cents per subscriber, just shy of the reported $1 that Fox was seeking. 100% Citigroup buys 80 Turkish bank stake citigroup inc. agreed to buy 20% 60 of Turkey’s second-largest bank, Akbank, for $3.1 billion. It is the first big purchase for Citigroup 40 Housing sale sets a record since the Federal Reserve lifted a ban on acquisitions by the firm. TISHMAN SPEYER PROPERTIES struck a $5.4 billion deal to 20 acquire Stuyvesant Town and Peter Cooper Village from MetLife Inc. The unprecedented price tag represents the first GE to auction ’03 ’04 ’05 ’06 0 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q residential acquisition in New York City by the owner of the power for NYC Chrysler Building and Rockefeller Center. Tishman Speyer general electric co. said it will partnered with the real estate arm of BlackRock Inc. to auction the rights to 300 Economy Watch megawatts of power capacity to finance the deal. The properties include 110 buildings on New York City firms starting in In September, NYC’s jobless rate hit its lowest point since February 1988, dip- 80 acres along First Avenue between East 14th and East January. GE is developing a new ping below the U.S. level. Area inflation posted its first drop since December. 23rd streets. transformer, which will allow AUGUST ’06 SEPTEMBER ’06 COMPARISON utilities and private firms to ap images purchase wholesale electric power NYC jobless rate 5.1% 4.5% 4.6%1 from the Pennsylvania-New NYC employment change +3,200 +1,200 +61,4002 MTV joins up Moynihan Station Jersey-Maryland grid. NY area inflation change +0.4% -0.5% +3.3%3 with China firm put on shelf 1-U.S. unemployment rate. 2-Change since December 2005. 3-Inflation rate for the latest 12-month period. viacom inc.’s MTV unit signed the proposed $900 million Interpublic a deal with Chinese Internet Moynihan Station was put on NYC Hotel Stats Broadway Stats search firm Baidu.com to indefinite hold after state shuffles ops distribute 15,000 hours of MTV Assembly Speaker Sheldon Silver interpublic group of Occupancy and room rates climbed In the week ended 10/15, attendance and Nickelodeon videos and refused to endorse the project.The Companies reorganized its media in August, PKF Consulting reports. and gross were at their highest since television shows. plan called for building a new rail operations for the second time in The average room rate of $240.71 July, The League of American The- station at the Farley Post Office. less than two years. Interpublic for the first eight months of 2006 atres and Producers says. Gross beat Media will be replaced by the was well-above 2005 levels; that for the same week in ’05, but at- Bloomberg not Futures Marketing Group, which occupancy edged down to 84.2%. tendance fell—typical for this season. Lawyer facing will house the company’s specialist ready to sell and digital capabilities. mayor michael bloomberg 28-month term (right) said his civil rights attorney Lynne media empire, Stewart was sentenced to 28 Morgan settles Bloomberg L.P., months in prison for passing along morgan stanley’s broker-dealer is not for sale, information to supporters of her unit agreed to pay $1 million to quashing rumors client, Sheik Omar Abdel- settle charges by New York state that he was Rahman, who was convicted in a Attorney General Eliot Spitzer, considering a bid plot to blow up New York City who said the investment bank had after receiving a bridges and tunnels. Federal failed to supervise a broker who number of newsbloomberg prosecutors had sought 30 years. defrauded customers of $740,000. unsolicited offers.The firm could eventually fetch up to $15 billion. Verizon turns page WSJ to boost Capital IQ’s Weekly Deals Report verizon communications inc.’s Grasso loses bid board of directors backed a plan to color pages TRANSACTION SIZE former new york Stock spin off the company’s telephone dow jones & co., which reported COMPANY (in millions) BUYER/INVESTOR TRANSACTION TYPE Exchange Chief Richard Grasso directories business to a 5.9% drop in September ad Cellfish Media $50.0 Caisse de Depot et Placement GCI was ordered by a state Supreme stockholders.The business, which revenue at The Wall Street Journal, Manhattan du Quebec, Trio Capital Inc., Court judge to return tens of includes 1,750 online and print announced plans to increase the Humagade Inc., Telecom Media Fund millions in deferred products, will become a new amount of color pages available to AGI Dermatics $5.5 Trevi Health Ventures GCI compensation from the public company named Idearc Inc. advertisers by 17% over the next Freeport, L.I. $187.5 million pay package that two years.The aim is Tipic Inc. $4.5 DADA SpA SB M&A Manhattan he received in 2003. to attract luxury Cablevision Systems Corp. n/a Dolan Family Group FB M&A CBS signs consumer advertisers. Bethpage, L.I. … Dow Jones agreed NetRatings Inc. n/a VNU Group B.V. SB M&A NBC overhaul Yahoo deal to buy out Factiva Manhattan nbc universal said it planned cbs entered into a from its joint venture Shopila Corp. n/a Dag Media Inc. SB M&A to slash operating costs by video content partner Reuters Manhattan $750 million and cut 700 jobs, or distribution pact Group for $160 GS Carbon Trading Inc. n/a DirectView Inc. SB M&A Manhattan 5% of its workforce, under a plan with Yahoo Inc. million. Reuters will to overhaul its traditional media Clips from 16 CBS- be paid to provide Selected deals announced during the week of Oct. 8 for companies headquartered in metro New York. n/a Not available. FB M&A: Financial buyer M&A represents a minority or majority operations.The network said it owned TV stations news to Factiva. acquisition of existing shares of a company with the participation of a financial buyer. GCI: will shut down MSNBC’s will be shown on —from staff Growth capital investment represents new money invested in a company for a minority stake. SB Secaucus, N.J., offices and move Yahoo.com, and the reports and M&A: Strategic buyer M&A represents a minority or majority acquisition of existing shares of a company without the participation of a financial buyer. the operation to Manhattan and companies will share bloomberg news ludwig vogel Englewood Cliffs, N.J. advertising revenue. reports

14 | Crain’s New York Business | October 23, 2006 Today’s Aetna

Connecting NY and NJ to a healthier business.

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©2006 Aetna Inc. Plans are offered by Aetna Life Insurance Company. Health insurance plans contain exclusions and limitations. *From BusinessWeek article,“How Good Is Your Online Nurse?,” February 20, 2006, copyright by The McGraw-Hill Companies, Inc., comparing member Web sites of the top three national insurers. 200680 NEIGHBORHOOD JOURNAL Organic move toward health in East NY

ment—not in retailing, but in pub- ed to Mount Sinai and the Local Center for the LDC. “Just getting B’klyn co-op enables lic health. The store will be used to Development Corp. of East New lunch every day is a challenge.If you study of good food’s assess how the availability of fresh York by the National Institutes of don’t want to eat fast food,you’re re- fruits and vegetables and other nu- Health. ally limited.” effects; BID standoff tritious ingredients affects people The heavily African-American Tiny grocery stores and bodegas with chronic health problems. neighborhood has some of the city’s predominate in East New York, and

ast new york in Doctors from Mount Sinai highest rates of obesity,diabetes and even its supermarkets lack the selec- ap images Brooklyn is about to School of Medicine will document heart disease.Experts say the scarci- tion of organic produce that the co- FOOD FOR THOUGHT: Park Slope’s food co-op become the first inner- the store’s impact on shoppers’ di- ty of healthful foods is a major con- op will offer when it opens around is the model for the East New York project. city neighborhood to ets, cooking habits and health. The tributor to the problem. Thanksgiving. The co-op will be get a high-quality food study, and the creation of the busi- “Our food choices here are not housed in a 3,000-square-foot for- Ecooperative. ness itself, is funded by a $1 million the greatest,” says Laura Sanzel, di- mer 99-cent store now being reno- “We’ve seen from focus groups The co-op is literally an experi- environmental justice grant award- rector of the Brooklyn Enterprise vated at 419 New Lots Ave. that people in the area are dissatis- fied with their ability to find healthy foods,” says Dr. Kimberly Morland of Mount Sinai, who helped secure Apply for an American Express® Business Card today to attend this exclusive OPEN SM forum. the NIH grant. The one exception is a farmers market that has been in operation since 1998.But the market runs only on Saturdays from June through November. The new store is being modeled after the Park Slope Food Co-op, WANT TO SET which has provided technical assis- tance as well as some volunteer la- bor.As is the case in Park Slope,only co-op members will be allowed to YOUR BUSINESS APART shop at the East New York store,and they will be required to work there three hours a month. FROM YOUR COMPETITORS? Manager Damian Mercado and a part-time assistant manager will be the only paid employees.That will al- low the co-op to sell food at just 20% or 30% above the wholesale cost. —erik engquist Find out how at “Standing Out In The Crowd.” Lagging Bronx BID Join OPEN from American Express ® for an exclusive Business lacks direction Cardmember forum with Liz Lange, Mario Batali, and the founders the 161st street Business Im- of Blue Man Group. It’s an evening of insight and inspiration – provement District in the Bronx won’t be improving much of any- moderated by Jean Chatzky, fi nancial expert and author. thing this year. The BID, officially established Hear their stories. Learn their secrets. And find out how they in early 2005, encompasses seven blocks along 161st Street—from took a new business idea and transformed it into a phenomenon. River to Morris avenues—and in- cludes 152 businesses. But the or- Visit OPENforumnyc.com or call 1-800-680-OPEN to apply for an ganization hasn’t gotten off the ground yet because it has no leader. American Express Business Card today. Upon approval, receive The merchants have chosen an ex- two complimentary tickets to this special event. And experience ecutive director,but the city blocked for yourself how American Express serves small business. his appointment on the grounds that he was not openly elected. “The search for an executive di- rector must be open and thorough,” “Standing Out In The Crowd,” an OPEN SM forum with says a spokesman for the city’s De- partment of Small Business Ser- LIZ LANGE, MARIO BATALI vices, which oversees BIDs. AND BLUE MAN GROUP Key to any BID’s success is its ability to collect mandatory assess- SM ments from its members to provide HOW AMERICAN EXPRESS SERVES SMALL BUSINESS services such as street cleaning, se- curity, graffiti removal and holiday lighting. But since its establishment more than a year ago, the 161st Street BID has not raised a dime. In the meantime, local shop OPENforumnyc.com 1-800-680-OPEN owners are being led by Pasquale Canale,president of the 161st Street Merchants Association, which is Nokia Theatre 1515 Broadway at 44th Street, New York City Nov. 16, 2006 6:30 pm – networking 8:00 pm – main program begins severely limited by its dependence Offer available to legal U.S. residents, 18 years or older who are American Express Business Cardmembers and to those who apply and are approved for an American Express Business on voluntary contributions. Mr. Card. Existing Cardmembers’ reservations must be received either online at OPENforumnyc.com or via phone at 1-866-504-OPEN by November 15, 2006. To apply for an American Canale’s P&D Hero Shop has been Express Business Card, visit OPENforumnyc.com or phone 1-800-680-OPEN. Applications must be approved by November 1, 2006, and new Cardmembers must make reservations by November 15, 2006. Offer valid while tickets last; limited number of tickets available. Void where prohibited. Limit two tickets per current or approved American Express Business a neighborhood fixture for 25 years, Cardmember. Tickets are available in pairs only. If tickets are available, unique user ID and password will be supplied to you in your confirmation e-mail. Click on link in e-mail and, once and he is one of the organizing you enter your information, the ticket print page will appear and prompt you to “print your ticket.” Each user name and password can be used for retrieval of ticket(s) only once. Event ticket terms and conditions apply. Event date, location, and seating are determined by sponsor and subject to availability. No alternative event dates, locations, or seating arrangements members of the BID. are available. No responsibility is assumed by sponsor for any canceled, rescheduled, unavailable, or postponed event in whole or in part. ©2006 American Express Company. Mr. Canale declines to comment on the tussle with the city. —hilary potkewitz

16 | Crain’s New York Business | October 23, 2006 HEALTH CARE INSIDE HOSPITAL REAL ESTATE: getting creative to expand, reuse sites P. 23-24 “We want the best care you can get for the people we rescue.” —Billy Leahy, FDNY’s Ladder Co. 4, Page 20

Relieving mind-body disorders in NY area Psych-friendly city becomes hub for studying costly, pervasive ailments

BY ELIZABETH MACBRIDE

after a fainting episode last spring that mystified her doc- tors,Amanda Smith decided she couldn’t risk going out, even to the mall or the post office.So she stayed at home, gaining weight and feeling miserable,as she en- dured the panic attacks that had been her companions for years. A message from God, as she puts it, changed her life. Going through letters from a goddaugh- ter, Ms. Smith found an article about people like her,plagued for years by unexplained symptoms. The article led her to a pro- gram run by Dr.Brian Fallon of the New York State Psychiatric Institute, who treats people DR. ROGER YURT in with hypochondria and related the “tank room” at New disorders. After eight weeks of York-Presbyterian’s Hearst burn center, therapy, Ms. Smith, who asked where wounds are that her real name not be used, washed daily. was able to go to the mall. “[They] taught me ways to

calm myself down.I can feel the buck ennis anxiety leaving my body,” she says. “In the last few months, I have been able to go to Macy’s.” Dr. Fallon and the psychia- trists who work with him are Burn centers used among the growing number of New York area doctors offering help to people like Ms. Smith. “If you were a hypochondri- ac, people used to laugh at you too little, too late and tell you to stop being a See RELIEVING on Page 18 Patients treated at hospitals without expertise; FDNY alarmed

monitor fluids and body tempera- three burn centers in the city are a large number of patients with se- BY GALE SCOTT ture. The center proved its value af- sometimes empty. rious burns are being treated at hos- ter the Sept. 11 attacks Some of the vacancies pitals without burn expertise. new york-presbyterian Hospi- when it saved half of the can be tied to the drop in “Triage needs to be overhauled,” tal’s burn center is a world-class 14 burn patients admit- $1.5M the number of burn vic- says Dr. Roger Yurt, director of the unit, one of four in the city where ted, though by standard THE COST OF CARING tims—fires in the city burn center. “We’ve had too many doctors routinely beat the odds,sav- U.S. Army measures, for a patient with burns have declined precipi- cases where hospitals transferred ing patients who hadn’t been ex- 67% should have died. over 60% of his or her tously to 51,395 from patients here too late.” pected to live. Its 150 staff members Yet today, many of the body 93,786 in 1993. But a In an era of consolidation and

istockphotos can care for up to 40 patients, 20 of beds at the hospital’s new study funded by the cost-cutting, one might expect calls HEAVY-HEADED: Somatization disorder them acute. Doctors perform daily Weill Cornell William Randolph city’s firefighters found that the cen- to reduce burn centers’ capacity.But sufferers need intensive health care. surgery on dead tissue and precisely Hearst Burn Center and the other ters are being underutilized because See CITY on Page 20

October 23, 2006 | Crain’s New York Business | 17 REPORT HEALTH CARE SELF-TEST FOR HYPOCHONDRIA Dr. Sidney Hart, a psychiatrist in Greenwich, Conn., who is consid- These questions are excerpted Relieving mind-body disorders ered one of the top private practition- from the Whiteley Index. Answer ers in the country,asks patients to fo- each using a scale of 1 to 5. cus on their thumbs. Soon their 1 = Not at all 3 = Moderately Continued from Page 17 tion marked by a number of unex- severe form of the condition, use 10 thumbs begin to tingle; eventually, 2 = A little bit 4 = Quite a bit crock,” says Dr. Fallon, who along plained symptoms that are often times more health care services than they hurt—proof that focusing on 5 = A great deal with a doctor in Boston recently won worsened by stress, have a huge im- those in the general population. symptoms can make them worse. ■ Do you worry a lot about your a five-year National Institutes of pact on the health care system. Treatments often mix behavioral The New York area has become a health? Health grant of about $2.5 million to therapy and medication.Therapy in- center for the study and treatment of ■ Do you think there is something study different therapies.“But rough- Widespread phenomenon cludes strategies like teaching pa- hypochondria and related illnesses— seriously wrong with your body? ly 60% to 70% of patients can benefit studies estimate that up to 60% tients that in any two-week period, sometimes classified as mind-body ■ Is it hard for you to forget about from treatment.This is a real disor- of patients in a primary care practice 90% of people have unexplained disorders—because of the strength yourself and think about all sorts der, and it’s profoundly distressing.” may complain of symptoms that have symptoms. Hypochondriacs may be of psychiatry here. And New York- of other things? Hypochondria, in which people no serious medical basis. Another exposed to what they fear: If they’re ers are more open to treatment. ■ If you feel ill and someone tells obsess about their health, and som- study found that on average, people worried about ending up in the hos- “People in this area are just into you that you are looking better, do atization, a more common condi- with somatization disorder, a more pital, they may be asked to visit one. being in therapy,”says Lesley Allen, you become annoyed? ■ Do you find that you are often aware of various things happening in your body? ■ Do you get the feeling that people are not taking your illnesses seriously enough? ■ Is it hard for you to believe the doctor when he/she tells you there Maimonides offers the people is nothing for you to worry about? ■ If a disease is brought to your attention, do you worry about of Brooklyn three things getting it yourself? ■ Do you often have the symptoms other great cancer centers don’t. of a very serious disease? To see the complete test and scoring information, visit www.uib.no/med/avd/med_a/gastro/wilhelms/ Location. Location. Location. whiteley.html. Source: University of Bergen, Norway associate professor of psychiatry at the Robert Wood Johnson Medical School at the University of Medi- cine and Dentistry of New Jersey in Piscataway, N.J., who is researching somatization.“It’s not stigmatized.” A critical mass of researchers in the mind-body field is established here, including specialists with sig- Maimonides nificant practices at the New York Cancer Center. Psychiatric Institute and the Robert Wood Johnson Medical School. Several researchers also are studying chronic fatigue syndrome and fi- bromyalgia, which causes chronic muscle and joint pain. H These illnesses have a medical basis—perhaps an immune-system problem—but people’s thought processes worsen them,says Dr.Fred Friedberg,assistant professor of psy- chiatry at Stony Brook University. Thinking positive “after yearsof feeling fairly ineffec- tual, I’m seeing some success with therapy that gets people motivated positively,”he says.“In general,it’s do- ing things that bring pleasure,rather than having the go-go mentality.” Cancer. In one way or another it’s an illness are now available at the Maimonides Cancer therapies and deliver radiation with pinpoint While mind-body disorders can that has touched all of us. Center. Located at the corner of 64th St. and accuracy. be managed, they are seldom cured, This year, close to 50,000 people in Brook- 8th Ave., it is the borough’s fi rst and only dedi- Of course, one thing that separates Mai- psychiatrists and psychologists say. lyn will be diagnosed with this disease. cated cancer center. monides from other cancer centers is that we Dr. Hart notes that one of his pa- The good news is that over the last several Opened in 2005, the Center offers the very also take great pride in treating the “whole” tients, a Wall Street executive, has years remarkable breakthroughs have been latest in cancer technology, like the fused person. That means being sensitive to the needs improved, but still sometimes ends made in its early detection and treatment. PET/multi-slice helical CT scanner. The scanner of patient and family alike. up in the emergency room. The great news for gives an ultra-precise picture of active tumors The cure for cancer may be down the road, Some researchers wonder if the in- the people of Brooklyn and their location allowing the board-certi- but for the people of Brooklyn the best cancer cidence of disorders is rising as socie- is these breakthroughs fi ed doctors at Maimonides to plan radiation care is right around the corner. ty pays more attention to health.In an age where comfort is paramount and answers are sought for everything, people are less tolerant of symptoms. Maimonides. “Almost every patient I see Medical Center spends a lot of time on the Web,” Passionate about medicine. Brooklyn’s only dedicated cancer center. says UMDNJ’s Dr. Allen. “They’re Compassionate about people. just more informed.” There’s even a nickname for Web-fueled attention to symptoms: For more information visit www.maimonidesmed.org or call (718) 765-2500 cyberchondria.

COMMENTS? [email protected]

18 | Crain’s New York Business | October 23, 2006 DR. LYNNE PERRY-BÖTTINGER Clinical and Interventional Cardiologist NewYork-Presbyterian Hospital GHI Participating Physician and one of New York Magazine’s DR. JOSEPH ZUCKERMAN “Best Doctors” Professor and Chairman Department of Orthopedic Surgery NYU Hospital for Joint Diseases GHI Participating Physician DR. DAVID ROSENSTREICH and one of New York Magazine’s Chief, Division of Allergy “Best Doctors” and Immunology Montefi ore Medical Center GHI Participating Physician and one of New York Magazine’s “Best Doctors”

BRIAN Computer Technician Brooklyn, New York

Many of the fi nest physicians and most respected medical institutions are affi liated with the GHI health plan. In fact, the majority of New York Magazine’s “Best Doctors” are in GHI’s physician network. So, should someone like Brian ever need specialty care, it’s comforting to know that such accomplished doctors are close at hand. GHI provides health insurance exclusively to businesses in New York State, and access to more than 140,000 provider locations in the tri-state network. Every employer wants top-quality health coverage at an affordable price. To compare GHI’s credentials and costs for your company, call 1-800-COVERAGE or visit us at ghi.com. Specializing in Great Doctors REPORT HEALTH CARE City’s burn centers used too little, too late

Continued from Page 17 burn centers to ramp up for a possi- that existing facilities would operate neighborhood doctor. “The doctors no one wants to do that.To the con- ble catastrophe in which 400 New better,and more burn patients would aren’t going to refer them to a burn trary, local and federal disaster pre- Yorkers might need burn care. get optimal care, if all serious burn center when they know they can get paredness experts are calling on Instead, burn center directors say patients, not just the worst-case in- $275 a visit from insurance,” says juries, made it to their centers. Dr. Finkelstein.“They treat it, wrap With funding from the New it up and tell them to keep coming York Firefighters Burn Center back every day.” THE CENTER treated Foundation,Dr.Yurt and colleagues many World Trade Center looked at state hospital admissions Dangers of inadequate care burn victims, including Elaine Duch. data covering several years. They but without burn center care, the found that as of 2004, 25% of burn chance of infection increases, along victims in New York City and 44% with the odds of lapses, such as lack of such patients in the region were of immediate physical therapy, treated at hospitals without burn which can leave a child disabled or centers. disfigured, Dr. Finkelstein says. “Less serious Dr. Andrew burn patients not Sama, vice presi- getting to burn Firefighters dent for emer- centers is a chronic gency medicine at problem,” says Dr. gave more than the North Shore- Jerome Finkel- Long Island Jew- stein, director of $7 million to ish Health Sys- the Staten Island tem, agrees that University Hospi- Weill Cornell’s hospitals often do tal Burn Center. not transfer burn For these patients, burn center patients, but says he says, one factor the decisions are may be that hospi- medical, not fi- tals and doctors nancial. stand to make “There may be money if the pa- economic pressure tients have good insurance. “Of like that,but it doesn’t happen here. course, it’s about money,” he says. We understand the value of a burn surgeon and we transfer critical 70 burn beds available burn patients,” Dr. Sama says. For where a burn patient is treated is the others, “We’ll bring in a plastic a call made first by the ambulance surgeon for a consult,and if the sur- crew and later by the hospital’s emer- geon says he can handle the pa-

gettyimages gency department. With 70 burn tient’s injury, we may admit the pa- beds available in the city,all within a tient.” quick drive or helicopter trip, there’s The underuse of burn centers no excuse for burn patients not being alarms the city’s firefighters, who admitted to one of the centers. have contributed more than $7 mil- To fill beds in his facility, which lion to support Weill Cornell’s burn last year treated 800 patients—500 center since its founding in 1975. of them children—Dr. Finkelstein “It’s the best care you can get,and has worked with volunteer ambu- we want that not just for our mem- America’sAmerica’s BestBest lance crews, convincing them that bers but for the people we rescue,es- most burn patients need burn center pecially the kids,”says Billy Leahy,a care. Still, he says, some patients member of the Fire Department of Business Bank never get to any hospital, let alone a New York’s Ladder Co. 4 at Times Business Bank burn center. Square and the president of the burn Typically, a parent will take a center foundation. child with a common injury such as ■ ■ Open 7 Days Totally FREE Business Checking a burned and blistered palm to a COMMENTS? [email protected] ■ Deposits Credited ■ Local Loans by CAREFUL IN THE KITCHEN Up to 6pm Local People NEW YORK’S FIRE RATE may have decreased, but the city continues to lead the nation in ■ Next-Day Availability ■ Quick Leasing Decisions kitchen-related home burns, says Dr. Jerome on Deposits Finkelstein, director of the Staten Island University Hospital Burn Center. With its Call Greg Braca at 1-888-751-9000 small apartment kitchens and rich mix of food-centered cultures, the city is a risky or visit your local store. place for toddlers, he says. The danger is that children tip over pans left bubbling on the stove, or may grab a hot pot left on the floor to cool in a cramped kitchen, he says. “I identify with that, because my grandmother in Brooklyn always had a pot of something on the stove,” he says. 400+ convenient locations throughout Burned palms are the most common Metro New York, Metro Philadelphia, Metro Washington, DC and Southeast Florida pediatric burn injury, and without optimum commerceonline.com treatment a child loses normal range of “Highest in Customer Satisfaction with Retail Banking in New York” motion in the hand. Two toddlers Dr. Finkelstein was treating recently at the — J.D. Power and Associates burn center were admitted for the night to get the best care, he says. They

Commerce Bank received the highest numerical score among retail banks in the New York metropolitan area in the proprietary J.D. Power and Associates 2006 Retail Banking Satisfaction immediately got intravenous fluids, were closely watched for infection, and StudySM. Study based responses from 3,881 New York metropolitan area households measuring 18 providers and measures opinions of consumers with their primary banking provider. Proprietary study results are based on experiences and perceptions of consumers surveyed in October and November 2005. Your experiences may vary. Visit jdpower.com/cc. promptly started physical therapy. Restrictions may apply for next-day availability, please see deposit account rules for details. Business Checking includes up to 300 transactions per month. Member FDIC istockphotos

20 | Crain’s New York Business | October 23, 2006 REPORT

HEALTH CARE ON

Crain’s Health Pulse, a paid online Company news Visitors to the site newsletter, provides the most up-to- can sign up for e-mail alerts that date information provide news about companies and on the business nonprofits involved in the health of health care, care field. including details Resources Get easy access to on mergers, con- health care statistics along with links tracts, executive to trade associations, government appointments agencies and advocacy groups and legislation in involved in the industry in New York. New York City and state, the northern suburbs, Long Is- land and nearby areas in New Jersey. An annual subscription costs $295. The one-page newsletter is available by 7:30 a.m., Monday to Friday. Pulse Extra, an additional page, is published on Wednesdays. For a free two-week trial, go to www.NewYorkBusiness.com and click on Health Pulse under “Newsletters,” Breaking news E-mail alerts keep on the lower left side of the home you up-to-date about the latest page. In the blue tools box, click on health care-related news. “Request a Free Trial.” After Back issues Use the online archives registering, you will receive e-mail to find Crain’s stories published in confirmation with instructions on previous editions of the paper. accessing the trial issues. Subscribe Use the “Subscribe now” Events View a current listing of local button to get the weekly print edition meetings, seminars and other of Crain’s and digital subscriptions networking events of interest to to the newspaper and the daily health care professionals. Insider political newsletter.

October 23, 2006 | Crain’s New York Business | 21 I can now get dates with over 65,000 doctors. It can happen to you. You and your employees can enjoy a network of physicians no other health insurance company can match.1 That includes access to more of the doctors rated “best” by New York magazine for the last 7 years.2 Which can give everyone in your office more reasons to feel well taken care of. And can make you feel great knowing you have provided your employees such extensive coverage. No wonder Empire BlueCross BlueShield is so popular.3

Find out which of our popular plans are right for you in just 5 clicks. Try our new online plan wizard by visiting www.empireblue.com/5clicksgo. Or call your broker or call us at 1-866-NEW BLUE, ext. 114.

121.2% more doctors in our EPO/PPO network than any other carrier in the same 28 eastern and southeastern New York counties and 10 bordering counties of New Jersey and Connecticut. New Jersey counties: Essex, Hudson, Union, Sussex, Passaic, Monmouth, Middlesex and Bergen. Connecticut counties: Fairfi eld and Litchfi eld. Based on a matching algorithm to identify unique doctors (Source: HealthConnect Systems, August 2005). 2More doctors rated “best” by New York magazine’s “Best Doctors 2006” list, issue dated 6/19/06, based on competitor’s website provider directory searches in August 2006. Comparison based on searches of directories or websites of Empire’s PPO as compared to Oxford’s Freedom network and Aetna, CIGNA, GHI and United’s PPO networks. Annual searches conducted as follows: 2006 Issue – June 2006; 2005 Issue–July 2005; 2004 Issue–August 2004; 2003 Issue–Aug/Sept 2003; 2002 Issue–Aug/Sept 2002; 2001 Issue–Aug/Sept/Oct 2001; and 2000 Issue–Aug/Sept 2000. 3 We have a 90.4% satisfaction rating. Cumulative results of daily call-satisfaction surveys for all product lines, 1/2/06 to 6/30/06. Services provided by Empire HealthChoice HMO, Inc., and/or Empire HealthChoice Assurance, Inc., independent licensees of the Blue Cross and Blue Shield Association. REPORT HEALTH CARE WOMEN IN HEALTH MANAGEMENT 2006 LEADERSHIP EVENT HONORING Facilities’ savvy solutions MARIANNE LEGATO, M.D., F.A.C.P. GENDER-SPECIFIC MEDICINE: THE COMING REVOLUTION IN unearth space in busy city HEALTH CARE OCTOBER 26, 2006 Hospitals park in old CITIGROUP CONFERENCE CENTER 153 EAST 53RD STREET, 14TH FLOOR garages, go vertical NEW YORK CITY to expand; seeking FOR TICKETS, CALL 212.545.1885 lowest possible costs

152 Madison Avenue BY ELIZABETH MACBRIDE Suite 801 New York, NY 10016 the mount sinai Medical Center Tel 212.545.1885 Fax 212.481.3071 found space for its latest expansion Email [email protected] in an unusual place—a parking ga- www.whmny.org rage.This fall, the institution began SPECIAL BLEND: New York the $70 million Methodist took pains to make HOSPITAL transformation of itsits newnew buildingbuilding fitfit intointo itsits REAL ESTATE the garage into a Brooklyn neighborhood. medical office building, which will free up space in the hospital for other projects. Chief Executive Kenneth Davis faces a bigger headache than rear- ranging employee parking:finding a place for the $400 million medical school building he says may be needed to accommodate growing research facilities. Like Mount Sinai, hospitals all over New York City are expanding and renovating as they update their aging facilities, which are consider- ably older than those in other parts SUSPENSE STORY: Memorial of the country. Hemmed in by a Sloan-Kettering built a crowded city, they are pushing up- structure above an existing ward, outward and into some sur- building to house larger ORs.

prising locations. associates granary “Everybody’s scrambling to try to create space,” says Philip Mon- esting building, constructed in the modate the robotic arms and bigger teleoni,a principal with architecture early part of the 20th century, but staffs used in modern surgeries, it firm Perkins Eastman.“I have a col- also because modifying the existing suspended a five-story, $70 million league who says she is the queen of structure is cheaper than erecting a structure above an existing building, the shoehorn fit.” new one, says Dr. Davis. supporting the addition by driving The hospital closings expected Some hospitals are pushing into four enormous columns through the to follow the Berger commission’s their surrounding neighborhoods. old edifice and the bedrock below. Dec.1 report on downsizing the sys- Brooklyn’s third-largest hospi- The tower opened in June. tem will increase the tal, New York pressure on survivors. Methodist, recently Industrial-strength plans The state has already NY’s AGE-OLD finished a four-year former industrial buildings, set aside $2.5 billion PROBLEM renovation in which it with their large floorplates, are be- in state and federal expanded its ER and ing used by hospitals in the bor- money to help with constructed a $34 oughs outside Manhattan. expansions and tech- million building with To house a $20 million cancer nology upgrades that 9.7 100 private rooms. treatment center, Montefiore Med- Median age of U.S. will be needed as facil- hospitals, in years The new building, ical Center in the Bronx used an old The Thirty-two years ago, Parker ities deal with the which fronts a resi- tile warehouse, the latest in a string Best pioneered techniques of restor- small flood of patients dential street in Park of nearby industrial properties that ative therapy that foster inde- from shuttered com- Slope, is designed to the hospital has converted. It Route pendence and rapid return to petitors. 12.1 blend into the neigh- punched windows into the walls,ex- “Most hospitals do Median age of NY borhood—its facade cavated the ground floor three feet from home. If you or a loved one renovate constantly, hospitals, in years takes cues from local down to make the center level with are recovering from a surgical Source: Almanac of Hospital Hospital to procedure, stroke, injury or ill- and if they fall behind, Financial and Operating Indicators row houses. a neighboring building, and con- it builds up quickly,” Other city facili- structed thicker walls to contain its Home ness, consider the short-term says Dan Riina,a part- ties are using bed linear accelerators. rehabilitation program most in ner at consulting firm TRG Health- towers as they look to replace some Meanwhile, some hospitals just tune with today's seniors. Short-term care in Southfield, Mich., which of their double-bedded rooms with wedge in space wherever they can. 718-289-2163/2164 works with hospitals in New York. private rooms—the standard in new When New York-Presbyterian need- rehabilitation at construction, since such rooms cut ed more office space, it found what Parker Jewish Institute Reduce, reuse, recycle down on infections, and patients it needed above Riverside Drive.Ac- for Health Care the majority of institutions here prefer them.A number of towers will cording to architect Mr. Monte- and Rehabilitation. struggle with weak balance sheets probably sprout in the city, like the leoni,the facade on one of the build- and are able to borrow for their ex- seven-story structure that Coney Is- ings had been designed with deep pansions only with the help of the land Hospital finished last year. notches to give it a muscular feel. state. In the current round of cre- Many institutions are building “We pushed those recesses out ative space-seeking, executives are up,but few are doing so in as unusu- and captured 15,000 square feet of

avoiding expensive new buildings. al a way as Memorial Sloan-Ketter- space,” he says triumphantly. 271-11 76TH AVENUE Mount Sinai is reusing its parking ing Cancer Center. When it needed VISIT US AT: NEW HYDE PARK, NY 11040-1433 garage in part because it’s an inter- larger operating rooms to accom- COMMENTS? [email protected] WWW.PARKERINSTITUTE.ORG Email: [email protected] REPORT Vacant hospitals finding new life

Developers turn OFF THE LIST them into residences; Recently closed hospitals. fate after Berger? Brooklyn Hospital Center Caledonian campus 2003

BY ELIZABETH MACBRIDE Staten Island University Hospital Concord Division 2003 in jamaica, queens, a former tu- Beth Israel Medical Center berculosis hospital is being turned Herbert and Nell Singer Division into a retirement community. In 2004 Manhattan, the 122-year-old New Our Lady of Mercy Medical Center York Cancer Hospital has been re- Florence D’Urso Pavilion 2004 vamped as condominiums. And in Saint Vincent Catholic Flushing, a developer is trying to Medical Centers come up with a residential plan for St. Joseph’s Hospital 2004 the former St.Joseph’s Hospital,pur- Saint Vincent Catholic chased in a bankruptcy proceeding. Medical Centers Elsewhere in the country, closed St. Mary’s Hospital 2005 hospitals generally sit vacant for years. But some of the six New York Source: Greater New York Hospital Association City hospitals closed since 2003 are being turned into residences. It’s a the historic structure economically sign of what is likely to happen when viable.The condominiums came on the Berger commission on downsiz- the market in 2005. ing the state’s hospital and nursing A hospital’s history can be home system issues a report on Dec. haunting, especially if a building 1 targeting institutions for closure. dates back to the early days of med- icine, says Peter Bafitis, a principal Many roadblocks with Manhattan-based RKT&B reusing a hospital, however, is Architects. fraught with difficulties, es- “Walking into an operat- pecially the likelihood of HOSPITAL ing room, a fairly large space community opposition. “A REAL ESTATE with skylights, you wonder, closed hospital is just not what did they do there?”says something that you ever Mr. Bafitis. “What could want to see,” says City Councilman they do there?” CRAIN’S BUSINESS BREAKFAST FORUM James F. Gennaro, whose district in Longtime Queens developer Queens includes the former St. Sean Lavin and two partners pur- Joseph’s Hospital. “We just want to chased the former St. Joseph’s Hos- see that site put back to productive pital in Flushing in 2004 for $10 MEET DR. THOMAS FRIEDEN, use, hopefully something that will million. St. Joseph’s previous owner, NEW YORK CITY HEALTH COMMISSIONER! bring real benefit to the community.” Saint Vincent Catholic Medical Because of the number of win- Centers, filed for bankruptcy pro- Health Commissioner Thomas Frieden will discuss his many dows, hospitals are generally best tection. initiatives to improve public health in New York, including suited for reuse as residences,but re- Mr. Lavin came close to leasing configuring them requires vision the building to Queens College for a efforts to make HIV testing routine and eliminate trans fats, and plenty of cash. The buildings dormitory,but the deal fell through. among other issues. He will be questioned by Crain’s editor often have to be gutted. Even when He hopes to find a residential use for Greg David and another journalist. they don’t, a massive amount of the building,which would fall under work is required to narrow corridors its current zoning and thus would be and break up big treatment rooms. subject to less regulatory review. DATE: WEDNESDAY, NOVEMBER 15, 2006 The MargaretTietz Nursing and Rehabilitation Center in Jamaica Plans for St. Mary’s PLACE: WALDORF=ASTORIA 701 Park Avenue will spend more than $80 million to another former Saint Vincent fa- turn a former tuberculosis hospital cility may find a second life at least TIME: Networking Breakfast 8:00–8:30 a.m. into Skyline Commons,a retirement partly as residences. The $21.2 mil- Program 8:30–9:30 a.m. community with about 160 apart- lion sale of St. Mary’s Hospital in ments and a 40-bed nursing facility. Brooklyn to the Backer Group is to COST TO ATTEND: “The building has a wonderful, close soon. Yehuda Backer, chief ex- unique art structure, with rounded ecutive of the Brooklyn-based devel- $55 for individual ticket(s) $550 for tables of ten windows and balconies,” says Ger- oper,says the group hopes to lease the if pre-registered by November 8th; if pre-registered by November 8th; ald Hart,Margaret Tietz’s executive building to a hospital. If it doesn’t, it $60 thereafter $600 thereafter director. “You couldn’t replicate it would explore residential options. today.” Surprisingly, few experts think YOU MUST BE PRE-REGISTERED TO ATTEND THIS EVENT. ALL TICKETS ARE NON-REFUNDABLE. The facade helped make the tu- that hospital buildings will be de- TO REGISTER, GO TO NEWYORKBUSINESS.COM AND CLICK ON “EVENTS”, OR FAX YOUR berculosis hospital attractive for re- molished. Many of the closures are BUSINESS CARD AND CREDIT CARD TO “FRIEDEN BREAKFAST” AT 212-210-0499. development.But the landmark sta- happening at institutions in the bor- tus of some hospital buildings oughs outside Manhattan, where it FOR MORE INFORMATION, CALL THE EVENTS HOTLINE AT 212-210-0739. complicates their reuse. One of the makes sense to reuse buildings be- grandest old hospital buildings, the cause of the high labor costs of new SPONSORED BY: New York Cancer Hospital, sat va- construction. Only if Manhattan cant for nearly 30 years. Chicago- hospitals close—a possibility,experts based MCL Cos. finally succeeded say—will the land itself be valuable in turning it into condominiums by enough to justify tear-downs. building an adjacent residential tower that made the restoration of COMMENTS? [email protected]

24 | Crain’s New York Business | October 23, 2006 SMALL BUSINESS

ARUN BHATIA Developer aims lower to live longer DEVELOPMENT

high cost of marketing all those ments to distinguish his projects in FOUNDED 1976 Bhatia organization willing to sell in bulk units individually and the risk that a crowded marketplace. EMPLOYEES 10 to lock in profit; rise of the ‘dormitory king’ the volatile condo market could turn Mr. Bhatia also makes sure that HEADQUARTERS 500 W. 43rd St. against him. cash flow, from management and sold most of a 16-story building on Build in financial safety. His Woo- development fees plus rent, covers UNITS DEVELOPED BY DEAN STARKMAN West 20th Street and a seven-story ster Street project, for instance, lies his overhead. Revenue from the sale 2,000 residential condos building on West 13th Street to in the heart of the SoHo cast-iron of units goes straight to the bottom 1,000 dormitory beds hen the luxury The New School for a combined historic district, where strict zoning line as profit. TOTAL VALUE $642 million condominium $45 million. guidelines curtail competitors. But the heart of his success market soared Jim Murtha, a New School exec- With help from his wife, Asmi- stems from an ability to measure his five years ago, utive vice president, says the school ta, an architect who is a global real risks carefully and to minimize ‘How much is enough?’ ” he says. Manhattan de- benefited from bulk pricing. Mean- estate planner for Citigroup Inc., them. veloperW Arun Bhatia looked certain while,Mr.Bhatia spared himself the Mr. Bhatia emphasizes design ele- “I do believe in saying to myself, COMMENTS? [email protected] to make a major killing with The Capri, his luxury high-rise project on East 55th Street. Just as the building neared completion, how- ever, he did something odd. He agreed to sell the bottom 32 of the building’s 47 floors whole- sale,for $57 million,to Marymount Manhattan College. The college got a 500-bed dormitory and Mr. Bhatia got to keep the tower’s valu- able top floors, where he still owns and rents out 25 of the original 40 units. “I like the cash flow,” he explains with a shrug. By meticulously maximizing its cash flow and at the same time min- imizing its risks, Mr. Bhatia’s Man- hattan-based development compa- ny, Arun Bhatia Development Organization, has managed to do something few other developers have done. It has posted profits in good markets and bad. The Bhatia approach hinges on following a few simple rules. Keep things small and simple. His firm has only 10 full-time employees. Marketing and other functions are outsourced. He also keeps no more than two projects under construction at any given time.Right now,his sole project in the works is 139 Wooster St., a super-deluxe condo develop- ment with only 16 units. Stay close to home. Mr.Bhatia sticks to neighborhoods he knows. With one exception,all of his 18 or so ma- jor projects have been between 13th and 86th streets in Manhattan. “I want something I can visit, something I can touch and feel, something I can control,” says the developer. That proximity makes it easier for him to attend weekly construc- tion meetings on his building sites. His in-house construction chief, Henry Goodhue, sits about 10 feet from Mr. Bhatia in an adjoining of- fice; the door is usually open. In ad- dition,Mr.Bhatia checks in with his outsourced project manager at least once a day. Limit leverage. A typical Bhatia project relies on borrowing to fund 75% to 85% of the costs. The com- pany studiously avoids higher-rate mezzanine financing, which usual- ly entails giving up a piece of the profits. Don’t be greedy. Rather than hold- ing out for top dollar on his projects, Mr. Bhatia has acquired the nick- name of the “dormitory king,” be- cause of his willingness to sell all or large parts of his projects to univer- sities. Besides the Marymount deal, the Bhatia organization built and

October 23, 2006 | Crain’s New York Business | 25 Bruno: odd man in Your future is a real-time decision. Continued from Page 3 “Sen. Bruno has outlived the unions and other traditionally Dem- Pataki people, and there has to be ocratic interest groups. He has some satisfaction for him in that,” moved left on gay rights, hospital says the Albany lobbyist. funding and pensions for public Mr. Bruno will be able to install employees. his own allies in positions with the “I have modified my positions,” state party. The current chairman, he concedes. “I’ve tried to lead the Stephen Minarik, is a Pataki man, majority toward the majority posi- as was his predecessor, Alexander tions in this state.” “Sandy” Treadwell. Mr. Bruno will likely choose a Also, when city officials need few defining issues—as Mr. Silver unanimous votes from the three has—and use his negotiating power men in a room, it will be Mr. Bruno to push for lower property taxes and they will be seeking to please. more upstate jobs. For example, he Albany lobbyists close to Mr. As the world speeds forward, change must be confronted in real time. has proposed development of high- Bruno could benefit by playing go- The Executive MBA Program at Columbia provides the opportunity to speed rail service upstate to promote betweens. They include his confi- pursue a Columbia MBA without interrupting your career. Are you seeking economic growth. dant James Featherstonhaugh, ca- intellectual rigor and a global perspective, supported by a network of ble industry insider Richard Alteri, like-minded individuals determined to lead? If so, join us for an upcoming Something old, something new former state party chair-turned- information session to learn more. The world won’t wait. Neither can you. republicans say that standing out lobbyist William Powers and horse- will be nothing new for Mr. Bruno. racing advocate Jerry Bilinski. TO REGISTER FOR AN INFORMATION SESSION VISIT US AT: He has charted a course independ- Mayor Michael Bloomberg has WWW.GSB.COLUMBIA.EDU/EVENTS/EMBA OR CALL US AT 212-854-2211. ent from that of the Republican joined the list of Mr.Bruno’s allies by GENERAL INFORMATION SESSION governor for many years and has campaigning for Senate Republi- Friday, November 3rd at 5:30 pm overridden many of Mr. Pataki’s ve- cans in tight races. During a speech EMBA-GLOBAL (COLUMBIA & LONDON BUSINESS SCHOOLS) toes, especially on budget issues. two weeks ago, Mr. Bloomberg Thursday, November 9th at 5:00 pm “Joe Bruno will continue to be a veered off-topic to praise Mr.Bruno WORKSHOP: MAKING THE CASE FOR SPONSORSHIP FROM YOUR EMPLOYER force to be reckoned with,” says as a friend of the city. Wednesday, November 29th at 6:15 pm Michael McKeon, a former Pataki “I’ve always thought Joe Bruno All sessions held at Warren Hall, Columbia Business School aide who now works as a lobbyist. has basically had New York City’s 1125 Amsterdam Avenue at 115th Street, NY “He has defended Senate independ- interests in mind,” Mr. Bloomberg ence, and rightly so.” told a gathering of business leaders. Under the new regime, however, “The state Senate has come through Mr.Bruno will be freed from the in- on gay rights more than many peo- ternecine battles that characterized ple would have expected, and it’s his relationship with the governor, come through with monies for New who twice tried to have him re- York City more than people would moved from power with the help of have expected.” would-be majority leaders Mr. Li- bous and Sen. Ray Meier of Utica. COMMENTS? [email protected]

THE WEEKS AHEAD

THIS WEEK’S EVENTS (212) 624-9110 or [email protected]. OCTOBER 24 OCTOBER 25 New York Public Library’s Science, Lower Manhattan Cultural Council and Industry and Business Library holds Commerce Bank hold breakfast on workshop on creating a business Web perking up an audience. 9:30 a.m. to site. 5:30 p.m. to 7:00 p.m., 188 11:00 a.m., 155 Canal St. Free. Madison Ave., room 018. Free. (212) 219-9401. extra< Ordinary Opportunity Boutique Building in Soho (212) 592-7000. OCTOBER 26 OCTOBER 24 Networking for Professionals holds 54 THOMPSON STREET Action International of NYC holds networking reception. 6:30 p.m. to 8:30 workshop on building a winning p.m., Techspace, 41 E. 11th St., 10th business. 6:15 p.m. to 8:30 p.m., 989 floor. Fee: $25 members, $30 Sixth Ave., fourth floor. Fee: $30. nonmembers. (718) 625-1369 or  HIGH-END EXECUTIVE INSTALLATION (646) 862-1710 or [email protected]. Courtyard [email protected]. OCTOBER 26 OCTOBER 24 New York Real Estate Institute holds HEADQUARTERS OPPORTUNITY United States Green Building Council seminar on increasing real estate sales. Rook Deck holds forum on environmental visions. 6:30 p.m. to 8:00 p.m., 139 W. 35th St., GRAND OFFICES FOR EXECUTIVES 6:00 p.m. to 7:30 p.m., International second floor. Fee: $25. (212) 967-7508. Center of Photography, 1133 Sixth Ave. OCTOBER 26 Gym Fee: $20 members, $30 nonmembers. U.S. Federation of Small Businesses HIGH-TECH SECURITY SYSTEM (212) 229-6084. holds networking reception. 6:30 p.m. to OCTOBER 24 8:30 p.m., Paramount Building, 1633 Showers Seedco holds workshop on restaurant Broadway, second floor. Fee: free for management. 2:00 p.m. to 4:00 p.m., members, $10 nonmembers. Department of Small Business Services, (718) 701-0087 or [email protected]. Sauna 110 William St., seventh-floor OCTOBER 26 boardroom. Free. (212) 618-8862 or South Bronx Overall Economic [email protected]. Development Corp. holds workshop on OCTOBER 25 contracting opportunities with NJ Tran- Commercial Techmarketing and iBreakfast hold sit. 3:00 p.m. to 4:30 p.m., 555 Bergen conference on the new ad revolution. Ave., third floor. Free. (718) 732-7547. 1:30 p.m. to 5:30 p.m., McGraw-Hill OCTOBER 26 Kitchen Center, 1221 Sixth Ave. Fee: $155 Queens Economic Development Corp. members, $275 nonmembers. holds seminar on how to start and operate a home-based business. 6:00 Dining Room p.m. to 8:00 p.m., Queensborough Hall, TO LIST YOUR EVENT 120-55 Queens Blvd., penthouse suite, Crain’s lists meetings online and includes them in the Kew Gardens. Free. (718) 263-0546 or Conference Michael C. Dreizen print edition as space permits. NYC events with fees [email protected]. under $300 are considered for the print publication. —adrianne pasquarelli Senior Managing Director Listings can be submitted only through the Crain’s 212.372.2173 Web site. Go to www.newyorkbusiness.com and More meetings online at [email protected] click on “Events.” Sponsors have a choice of sever- www.newyorkbusiness.com al free or paid listing options. All business events will be posted online within two business days. Click on “Events”

26 | Crain’s New York Business | October 23, 2006 porting a refurbished, re- energized Guggenheim in Refocusing on the Guggenheim New York.The foundation’s largest corporate donor, Continued from Page 1 institution, she has named a 10-per- tional development office,” Ms. Deutsche Bank, which is its clude shaking up the development son New York advisory board, led by Dennison says. partner in the Guggenheim department and adding curators. financier David Ganek. Like a simi- She plans to add curators, who Berlin, is about to sign its “All together, it has put us on the lar committee in Venice, it will guide now number 16, and has already third five-year sponsorship path to refocusing attention on the the museum on development, acqui- hired specialists in architecture and agreement. Guggenheim as one of New York’s sitions, preservation and strategy. design and Asian art. “We are excited about premier cultural institutions,” Ms. Although next year’s shows can- her focusing on the Dennison says. Fund-raising specialties not be finalized until a construction Guggenheim here in New

Ms. Dennison was named direc- it will dovetail with a restructur- schedule is established, the muse- buck ennis York, and making sure it is tor of the Guggenheim Museum, a ing of the development staff, which um will remain open during the A DRAW: Sponsors are eagerly supporting the museum. the most important con- new position, in the wake of a has doubled to 26 people over the renovation. temporary art museum in falling-out between Peter Lewis, past year. Certain staffers now spe- Future exhibitions will increas- the city,”says Gary Hattem, then chairman of the board of cialize in major gifts and capital ingly be culled from the permanent lion to mount, Ms. Dennison esti- president of the Deutsche Bank trustees and the institution’s largest campaigns, corporate and institu- collection, as much to spotlight the mates. Special exhibitions usually Americas Foundation. donor,and former Director Thomas tional giving,and individual and an- museum as to save money. A show run $2 million or more, she says. Krens. Mr. Lewis believed that the nual giving. “There was not a tradi- from the collection can cost $1 mil- Major sponsors are already sup- COMMENTS? [email protected] museum’s robust international ex- pansion, spearheaded by Mr. Krens, came at the cost of the New York flagship. That view was widely shared in the museum community. “When you put a lot of energy in one area, it comes at the expense of another,” says Glenn Lowry, direc- tor of the Museum of Modern Art. “The program here in New York had not been perhaps as vigorous as it could have been.” Ultimately, Mr. Lewis quit the board,and Mr.Krens was named di- rector of the Solomon R. Guggen- It’s one thing to put opportunities in front of clients. heim Foundation so he could put his energy into the foundation’s global expansion. Museum branches have sprung up from Bilbao to Berlin. A future outlet is slated for Abu It’s another to put the integrated Dhabi and another is being consid- ered for Guadalajara. thinking of an entire bank behind them. Answering critics ms. dennison was promoted from deputy directory and chief curator so she could focus on the Upper East Side flagship. She has tough words for critics who say the New York mu- seum was allowed to lose its edge. CAPITAL IDEAS from KeyBanc Capital MarketsSM “I don’t think we took it for grant- ed,”says Ms.Dennison,who has been Our clients are consistently faced with critical business and on the curatorial staff at the Guggen- heim since 1978.“We are a New York $75 Million $35 Million capital challenges. At these defining moments, they need more institution first and foremost.” Senior Credit Facility Senior Credit Facility Her quest to reaffirm the Gug- than just financing. They need integrated thinking, backed by our genheim’s commitment to New York $80 Million comes at a tough time for nonprofits. Preferred Ships Mortgage full range of commercial and investment banking capabilities, to The Guggenheim is said to be facing Sole Lead Arranger Co-Agent and Lender a shortfall this year in its $35 million create significant and lasting value at every opportunity. We can operating budget as donations to all museums continue to shrink.Corpo- apply the same level of thinking to your company’s challenges as rate sponsors are pressuring muse- ums to feature products and logos in well. Sound like the kind of value you’re looking for? Call us. the exhibitions they finance, though Ms. Dennison says the museum dis- misses such requests. And atten- $110 Million $1 Million dance levels at the Guggenheim have Senior Credit Facility Initial Public Offering never fully recovered to pre-Sept. 11 Achieve anything. numbers of about 960,000 annually. Managing Agent Last year, attendance hit 930,000. and Lender Co-Manager For more information, contact Joe Markey, Director, Meanwhile, the cost of putting at 917-368-2239, or go to www.Key.com/kbcm. on shows runs ever higher. “It has gotten more and more difficult to mount exhibitions,” says Mr. Lowry.“The costs of transportation and insurance have skyrocketed.” Ms. Dennison is forging ahead. Despite her mentor’s controversial exit, she plans to build on what Mr. Krens instituted during a long tenure, during which the two worked closely together. That KeyBanc Capital Markets is a division of McDonald Investments Inc., member NYSE/NASD/SIPC, and a trade name under which corporate and investment banking services of KeyCorp and its subsidiaries, including McDonald Investments Inc. and KeyBank National Association, are marketed. It is not a legal entity. would include enlarging the range Securities products and services are provided by McDonald Investments Inc. and its licensed securities representatives, who may also be employees of KeyBank of exhibitions to include more National Association. Banking products and services are offered by KeyBank National Association. shows on architecture or the an- ©2006 KeyCorp tecedents of modernism. “I haven’t come in to prove myself as a vision- ary,” she says. CONSUMER ENERGY FINANCIAL SERVICES DIVERSIFIED INDUSTRIES FINANCIAL SPONSORS HEALTHCARE INDUSTRIAL REAL ESTATE TECHNOLOGY To refocus attention on the main

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28 | Crain’s New York Business | October 23, 2006 side stuck in a mind-set such as Mercedes and Land Rover dating back 15 years. are coming into the paper for the Daily News pressed in tough market And he can already first time. point to successes, par- Still, the Post is not going away. Continued from Page 2 ticularly the Queens, A source close to the paper says its supplements, put ad- TALE OF THE TAPE Brooklyn and Bronx daily circulation will also be up when vertising on Page 2 for ADVERTISING REVENUE, January supplements, which the ABC figures are released. the first time and in- through August 2006 paper started rolling out What’s more, the Post plans to vested heavily in the in the spring. According mine the News for advertising Internet. Daily News $329 million to Mr. Kramer, the sup- prospects and offer them readers But he can only ac- New York Post $171 million plements have increased in the boroughs—long a strong- complish so much in a Source: TNS Media Intelligence regional advertising rev- hold of the News—through the lo- difficult market for enue by 10%. cal papers. print—and with the CIRCULATION for six months New circulation pro- Post breathing down ended March 30, 2006 grams, such as the use of Hijacking Macy’s the News’ neck on the DAILY SUNDAY house ads to acquire with mr. goodstein’s help, the circulation front. subscriptions, are also Post has also made gains among ad- “We’re having a Daily News 708,477 795,153 bearing fruit. Rhonda vertisers that were once carried al- tough year, but on bal- New York Post 673,379 413,763 Novick, the new circula- most exclusively by the News. ance we’re doing better Source: Audit Bureau of Circulations tion head, says 7,000 Through August,Macy’s has tripled than most,” says Mr. subscribers have been its ad buy in the Post,to $2.5 million, Kramer, noting that gained this way so far in and cut spending in the News by 7%, there have been much bigger ad dips ship includes one of the deans of ough supplements. 2006, compared with 200 last year. to $8.6 million. at other papers. New York tabloids, the former chief Mr. Kramer says he isn’t fazed by In addition, a Scratch ’n’ Match Media buyers say the circulation A heavyset man with a gruff operating officer of the News,Les the Post’s moves. What’s more, he contest and what Mr. Kramer de- advances by the Post have made it sense of humor who grows excitable Goodstein—who jumped to the enjoys the support of the mercurial scribes as targeted use of sponsored necessary to use both papers, when on the subject of his competition, competition after being passed over owner of the News, Mort Zucker- editions helped put an end to two they could once have used only the Mr. Kramer has not hesitated to put for the top spot. Since becoming a man—for now. years of circulation erosion. The News. his stamp on the News. In the last senior vice president at News Corp., “All media companies are facing Daily News reported figures for the The Post still loses millions of nine months, veteran executives the Post’s parent company, Mr. tough times, but it is in those times six months ended Sept. 30 that will dollars a year while the News, have paraded out the door, to be re- Goodstein has been putting his ex- that you need people with creativity show a 1% increase in average daily sources say, is marginally profitable. placed by former colleagues of Mr. tensive advertising contacts to use. and vision to continue to drive the circulation, as filed with ABC, sub- Experts say the tables could turn, Kramer’s from the Times. business forward,” Mr. Zuckerman ject to audit. Circulation for the eventually. Such moves have raised eye- Battling in the boroughs wrote in an e-mail. “Marc has Sunday paper will be flat. “Even at the rate the Post is grow- brows among some members of the he also engineered the Post’s brought those skills.” For papers nationwide, daily cir- ing, it’s going to be a long time be- media buying community, who acquisition of two local news- As far as Mr. Kramer is con- culation is expected to drop 2.5%. fore it overtakes the News,” says wonder how well the recruits will paper chains, with papers in Brook- cerned, the News’ executive offices Mr. Kramer also points to bright newspaper consultant David Cole. adapt to the gritty practices of one of lyn, Queens and Staten Island, needed shaking up. He has hired spots on the sales side. Luxury re- “But that’s not to say it won’t.” the nation’s oldest tabloids. which will go head-to-head with new people, he says, precisely be- tailers such as Michael C. Fina and In comparison, the Post’s leader- the News’ recently launched bor- cause he found the News’ business high-end automotive advertisers COMMENTS? [email protected]

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October 23, 2006 | Crain’s New York Business | 29 THE LIST SO FAR ing. They can expect a winter of ex- New York area companies caught up cruciating audits. Last week, ac- in the backdating scandal. NY firms caught in options net counting industry regulators gave BARNES & NOBLE ammunition to auditors by issuing Continued from Page 1 noncash expense for improperly port said that “almost all” of Bed BED BATH & BEYOND advice on how to question company pany’s illegal options practices. Mr. granted options. Bath’s annual option grant dates assumptions about options. Alexander was indicted in August Nationwide,an estimated 14% of from 1998 through 2004 “likely CA Over the long term, companies for backdating and has fled to all option grants between 1996 and were selected with some hindsight.” CABLEVISION SYSTEMS may decide that having top execu- Namibia. 2005 were backdated, according to Nevertheless, a special board com- tives occupied by depositions over Backdating—the practice of ma- University of Iowa finance professor mittee found no evidence of “willful THE CHILDREN’S PLACE RETAIL STORES pay practices is an untenable luxury. nipulating the “grant date” of previ- Erik Lie.So far,at least 26 senior ex- misconduct.” COMVERSE TECHNOLOGY Indeed, former Monster boss Mr. ously awarded stock options to jack ecutives have been fired, suspended The company’s conclusion puz- DRS TECHNOLOGIES McKelvey cited the “demands of up the options’ value—wasn’t a or forced to resign from the nearly zles some analysts. time” needed to deal with the op- game played just by technology 150 companies that have reported “How does one grant options GLENAYRE TECHNOLOGIES tions matter as the reason he was companies,which were the most ag- internal or government investiga- with hindsight without willfully do- KERYX BIOPHARMACEUTICALS stepping aside from the company he gressive firms in giving out options. tions, according to human resources ing so?” says Jack Ciesielski, an ac- started 39 years ago. He was re- Some of the area’s leading retail- consulting firm Challenger Gray & counting expert and owner of Balti- KOS PHARMACEUTICALS placed by the company’s president ers have reported that they are under Christmas. more investment research firm R.G. L-3 COMMUNICATIONS and chief operating officer. investigation, including Barnes & Associates Inc. “It seems like a con- Clearly,Monster needs someone MEDAREX Noble,Bed Bath & Beyond and The Common practice tradiction to me.” with both hands on the wheel dur- Children’s Place Retail Stores.Oth- a report contained in a Bed Bath Ronald Curwin,senior vice pres- MONSTER WORLDWIDE ing a difficult time. Its stock price er well-known concerns disclosing & Beyond regulatory filing earlier ident for investor relations at Bed NYFIX has fallen nearly 25% in the past six government probes include Cable- this month offers a behind-the- Bath, declined to comment on the months as rival job site Career- vision Systems and Grand Theft scenes glimpse at how common- board committee’s report other than TAKE-TWO INTERACTIVE SOFTWARE Builder.com appears to be gaining Auto video-game publisher Take- place backdating was. to say, “The Bible has statements VERINT SYSTEMS share and popular blogs such as Two Interactive Software. L-3 The report says that the chief ex- that are contradictory.” TechCrunch and GigaOm intro- Communications Holdings is con- ecutive and co-chairmen at the Bed Bath says it is cooperating duce job boards to boost traffic. ducting an in-house probe.CA,for- Union,N.J.-based retailer doled out with an SEC inquiry and expects to Bath executives have left the com- “Technology changes so fast,you merly known as Computer Associ- more than 19,000 individual option take a $66 million noncash charge to pany due to backdating.At least two really can’t afford to have a distract- ates, completed an internal grants to employees, ranging from stockholder equity on its balance shareholder suits have been filed. ed management team,” says S&P’s investigation in July that led to the senior executives to assistant store sheet for the fiscal year ending next In the weeks ahead, more com- Mr. Silverblatt. restatement of four years of financial managers, starting in 1992, when March, plus an $8 million noncash panies are expected to come forward results. It recorded a $342 million the company went public. The re- charge in the third quarter. No Bed with detailed accounts of backdat- COMMENTS? [email protected]

thousands of iPod downloads. This week, Heavy will launch a Wooing the Heavy-hitter of video on the Web channel backed by Reebok that will feature user-generated skateboard- Continued from Page 1 $15 million this year, three times what they want, a mix the company tuous women in small bikinis to an- ing videos.In addition,the Web site destination on the Internet. 2005’s totals. Revenues are forecast describes as “humor, games and imated characters like Spartan war- recently cut a deal with Burger King Last month, Heavy boasted an to more than double next year, girls.” The site provides free access rior Kratos from popular video game and Microsoft to produce a series audience of more than 12 million reaching $35 million. to 30 broadband channels, such as God of War. based on a new game for Mi- unique viewers, triple the number a Behind the Music that Sucks and “Heavy has been an under- crosoft’s Xbox game player that fea- year earlier. The company’s rev- What men want Heavy’s Angels. It offers hours of hu- ground mainstay for years, with ir- tures the King character.The videos enues have kept pace: They’re on heavy makes its money by giving morous, frequently raunchy videos reverence, titillation and a handful will be available on Heavy and on target to come in on the high side of males between the ages of 18 and 34 featuring everything from volup- of cool,” says Ben Macklin, senior the Xbox. analyst at research firm eMarketer. “Heavy is in a great position to The seven-year-old company, become a dominant entertainment with its staff of 55, produces more brand,” says Michael Hirshland, than half of the videos appearing general partner of venture firm Po- on the site, which helps it avoid the laris Ventures, which led a $10 mil- copyright-infringement issues that lion funding round in December. are dogging YouTube. The rest of Heavy used the capital to expand its Heavy’s videos are homemade programming. offerings uploaded by users. Heavy also allows users to share videos The Heavy backstory and personal bios—key elements in the co-founders, Mr.Carson and Vision in the success of MySpace, the social Simon Assaad, have been creating networking site snapped up by attention-getting content for years. News Corp. earlier this year for Each of the thirtysomething execs $580 million. got his start working for big ad real estate In contrast to YouTube and agencies, including Young & Rubi- MySpace, Heavy is profitable, at cam and Ogilvy & Mather. They least on an operating basis. Profits went on to build teenage music net- come from two sources. Most are work Fuse for Cablevision Systems requires generated by the advertising carried Corp.—a client of ad agency Heavy on its Web site, while downloads of Industries, which the partners its videos to cell phones and iPods founded the same year that they cre- account for 20%. ated the Heavy Web site. good ears. Heavy boasts more than 100 ad- Two years ago, sensing the com- vertisers—including big names ing online advertising boom, they such as Sony Entertainment, folded their agency and focused Unilever and Coca-Cola—up from solely on their Web site. a mere five two years ago. The Web That site is now valued at $100 site offers advertisers the opportuni- million, and media heavyweights We’re a global firm that delivers real estate solutions exclusively to ty to do things a bit differently to such as Viacom and Yahoo have re- grab the attention of the notori- portedly made preliminary offers. tenants. But our expertise is actually listening to our clients. So contact ously hard-to-reach younger male Heavy’s founders, who are hop- CRESA Partners. When you work with us, you’ll like what you see. demographic. ing to make a big killing, are aware “Heavy is seen as a bit of a test that their pickiness may have a price. bed for advertisers looking to exper- On the Internet, fame and fortune iment and innovate online,” says can be fleeting. Mr. Macklin. “I always look over my shoulder Last year, for example, Burger for the new kid on the block and 100 Park Avenue, 24th Floor . New York, New York 10017 . 212.758.3131 King invited people to make videos make sure he doesn’t become the cresapartners.com of themselves wearing masks of the next hot thing advertisers go to,” chain’s King mascot. The videos says Mr. Carson. were posted on Heavy, attracting more than 10 million views and COMMENTS? [email protected]

30 | Crain’s New York Business | October 23, 2006 BUSINESS CORPORATE LADDER Switching to women’s fashions PAGE 33 buck ennis

GOTHAM GIGS Star snipper LAURENT DUFOURG, 55, is a celebrity hair stylist and owner of Privé, a busy salon in the SoHo Grand with branches in WAITING TO BUY: Benjamin and Sarah Miami and Los Angeles. Segal with their BIG BREAK daughter, Isabel, He attributes his outside their Carroll popularity to news-making Gardens apartment. short cuts he gave Sharon Stone and Gwyneth Paltrow in the same week. “I got lucky, and it just snowballed from there,” says Mr. Dufourg, born in Biarritz, France.Teri Hatcher, Uma Thurman, Heidi Klum and Tea Leoni are among his clients. PRICE CHECK He charges $300 a haircut, a bargain considering that some star cutters demand as much as $900 a snip.The relatively moderate fee makes for better business because noncelebrity customers come back more often, says Mr. Dufourg, who spends 30 minutes on each appointment and does as many as 25 cuts a day.“You have to be honest; it’s only a haircut,” he says. PLAYING THERAPIST He did the hair for one regular customer’s fourth wedding; she told him that he knew her better than her husbands did. Another client said she prefers him to her shrink because he charges less and she leaves the session feeling better about herself and her hair. —samantha marshall — EXPERT OPINIONS Renting for now WHAT ARE THE HOT Would-be buyers anxious over market can’t pull the trigger HALLOWEEN COSTUMES? right now, our biggest sellers are costumes from the movie V for Vendetta, the Fanta girls, the usual Super-

man and buck ennis Supergirl, Dog the Bounty MANHATTAN BY TOM FREDRICKSON Hunter and RENTS pirates from arah segal’s timing in selling her $1 million Manhattan apartment was impeccable. Average for Sept. 2006. Pirates of the Caribbean.For She and her husband, Benjamin Segal, associate creative director at an advertising guys this year, the agency, sold their Chelsea triplex near the market’s peak in late 2005.They decided Studio $1,817 king in the Burger to rent for a while, settling in Carroll Gardens, Brooklyn, to take stock of the King commercials is great, market and perhaps buy in at a cheaper price.They’re renting a bright, if congested, 1 bedroom $2,521 and pretty conservative. But if two-bedroom apartment in a brownstone. you don’t do anything for 2 bedrooms $3,458 Halloween, you’re a Scrooge. “My husband and I are starting to get anxious,” says Ms. Segal, 33, a stay-at-home —ricky kenig mom and former Syracuse TV news reporter. “We are feeling a bit cramped, and we 3+ bedrooms $5,176 Owner of Ricky’s NYC want to find a place we can settle in for a while.” See WOULD-BE on Page 32 Source: Citi Habitats Inc. S October 23, 2006 | Crain’s New York Business | 31 BUSINESS LIVES Finishing Touches Included Would-be buyers rent for now Continued from Page 31 UP TO 128,000 SF The Segals have plenty of compa- ny.Thousands of New Yorkers,many PRIME TURN-KEY, FURNISHED OFFICE SPACE of whom would have been on the AVAILABLE FOR SUBLEASE prowl to buy apartments, are instead at signing leases. The city’s real estate 237 PARK AVENUE market remains strong compared with other regions’. Still, growing Recently built executive offices, open area and numbers of buyers-in-waiting are multiple conference rooms with high-end finishes caught between nervousness about I Ideal Grand Central Location a correction and the still-high cost I of buying. While they hope for Available First Quarter 2007 things to even out, the standoff is helping fuel an increase in rents. In Manhattan, the expanding rental market has pushed vacancy rates below 0.5%,and rents on apart- ments that turn over are up about 10% this year, according to Eric Hamm, director of New York area residential leasing for Century 21. Some renters are sitting tight, BUY? RENT? WHAT TO DO even though they have the money to buy. Jimmy Yang and his wife, Inha REASONS TO BUY REASONS TO RENT Yang,both 32,have saved enough by Plan to stay put for five years Plan to move in less than five years renting a $2,200-per-month, two- bedroom Park Slope apartment to Like remodeling to create own space Don’t mind dealing with landlords be in a position to buy. For now, the Want to build equity Have rent-stabilized apartment apartment is big enough for the two of them and their 22-month-old Can manage monthly Can’t afford mortgage payments toddler. Mr. Yang, a lawyer, figures payments without risky loan

he would have to spend $4,000 to istockphoto $5,000 a month to buy a compara- ble apartment. move. I believe prices will drop jumped to $2,800 from $2,000. eventually.” Ms. Brown, who has a part-time Hoping for lower prices Adi Neumann, an Israeli-born job teaching nursing psychology, “now i am confident that we have model who has been the face of landed an apartment in Harlem for FOR MORE INFORMATION, PLEASE CONTACT: enough squirreled away to buy Calvin Klein advertising and has ap- $1,000 less than she would have paid Josh N. Kuriloff Alex Cohen something if we want,” Mr. Yang peared on the cover of Cosmopolitan, at the old place. By continuing to 212.841.7894 212.841.5927 [email protected] [email protected] says. “But we are content to stay believes apartment sale prices will rent,she can save money for an even- where we are until the need arises to drop 15% in the next year and is will- tual move outside of New York if the ing to wait for that to happen. She right opportunity presents itself. has checked out some apartments in “If I buy something, it won’t be Williamsburg, Brooklyn, and other an apartment,” Ms. Brown says. areas but was disappointed with the “The prices are outrageous. I would quality of the apartments in the rather buy a house, but not in New $1 million to $1.5 million range. York City.”

3rd Avenue “Every month or so, I check the Internet,” Ms. Neumann says. “It’s Resigned to renting definitely starting to feel like nicer barbara byrne denham, a real es- east 125th street 125th Street stuff is available for $1 million than tate economist who lives on the Up- development. was available a year ago.”She is con- per West Side, has more or less re- tent to keep her three-bedroom, signed herself to renting, despite a three-bath TriBeCa apartment, $400 per month jump in her rent imagine the possibilities. which is rent-stabilized and costs this year. She lives across the street $4,750 per month. from her son’s school in an apart- 2nd Avenue Rent stabilization doesn’t pro- ment she loves. She figures that a tect everyone,however.When a sta- comparable place would sell for bilized apartment’s rent creeps up to $1.1 million, translating into mort- the market rate,the landlord can re- gage payments that would be a third move it from the program and in- higher than her rent. 127th Street crease rents as much as he wants With prices as high as they are,she upon the expiration of a lease.That’s would have been better off buying what happened to Broadway actress years ago.“If it happens,it happens,” Gwendolyn Brown, who recently she says. “If I were to really focus on SEEKING PROPOSALS FOR DEVELOPMENT moved to Harlem when the rent on it, it would probably bother me.” New York City Economic Development Corporation (NYCEDC) is her Upper West Side apartment seeking proposals for the redevelopment of approximately six acres reached the market rate and then COMMENTS? [email protected] in East Harlem into a dynamic retail, residential, entertainment and media destination in upper Manhattan. REPRINT, POST PUBLISHED ARTICLES Responses are due no later than 4:00 p.m., Friday, January 12, 2007. Submission guidelines and requirements are outlined in the RFP and available REPRINTS OF CRAIN STORIES to download at www.nycedc.com/RFP, or for pick-up at NYCEDC, 110 William Street, 6th Floor, New York, NY, Monday - Friday, 9:30 a.m. to 4:30 p.m. Crain’s New York Business offers reprints of the articles it publishes. To obtain an estimate of the price and the turnaround time for a reprint, please contact Lori Noffz at Reprint Management Services, (717) 399-1900, ext. 104, or [email protected]. Readers wishing to make their own reprints or to post a story on a Web site must pay $350 for the use of the Crain’s copyright; the fee for nonprofit organizations is $195. To get additional information, please contact Jill Bottomley at Crain’s New York Business, (212) 210-0282. REQUEST FOR PROPOSALS

32 | Crain’s New York Business | October 23, 2006 BUSINESS LIVES CORPORATE LADDER William McComb Fashioning a transition Liz Claiborne chief will pain relievers. He says that close relationships PERSONNEL FILE use skill in marketing with his wife and older sister helped him keep tabs on the powerful female COMPANY Liz Claiborne Inc. to women to succeed demographic. By staying in touch TITLE Chief executive with pop culture, through magazines in new industry such as Vanity Fair and new television AGE 43 shows such as Friday Night Lights,he RÉSUMÉ Company group BY ELISABETH BUTLER expects to remain in the know. chairman of orthopedics and neurologics, Johnson & Johnson ashion industry in- Filling Charron’s shoes siders raised their eye- he’ll need all his trend-spotting EXERCISE ROUTINE Swims or brows last week when skills as he tries to fill the large shoes uses the elliptical machine for an Liz Claiborne Inc. se- of Paul Charron, the industry titan hour five days a week lected William Mc- who has led Liz Claiborne since BIRTHPLACE Columbia, Mo. FComb, a bigwig at Johnson & John- 1994. Mr. Charron, who expanded son, to be the new chief executive of the company through aggressive ac- the $5 billion apparel company. quisitions, will become chairman has stumbled as younger company But Mr. McComb expects to emeritus at the end of the year. brands such as Juicy Couture and

make a smooth transition into the Retail recruiters say a savvy out- Lucky stole the limelight. The com- buck ennis fashion world.After all,he says with sider can make it in the fashion pany recently hired a new designer a laugh, his high school class in Fort world. “These executive teams are and launched an advertising cam- While levitating the line, the Although landing the top spot at Wayne,Ind.,named him “most styl- navigating uncharted waters,” says paign to revive the Liz Claiborne new chief will keep his blue eyes Liz Claiborne was good news, Mr. ish” during his senior year. Barbara Marchetti, president of re- brand,but the turnaround has just be- open for new acquisitions to fill out McComb had to face resigning Mr. McComb, a bit of a clothes- tail recruitment firm C-Suite Inc. gun. To boost sales, Mr. McComb the company’s closets. from Johnson & Johnson after his horse who sported a Hickey Freeman “It’s highly appropriate for execu- will have to land more space at long tenure there. He and his wife, suit, Ike Behar tie and Liz Claiborne tives to look at the worlds of busi- Macy’s,the 800-store chain owned by Rough year Marianne, who live with their three shirt to the office last Tuesday, will ness and fashion simultaneously.” Federated Department Stores Inc. all the responsibilities will teenage sons in Bucks County, Pa., rely on his abundant people skills His first priority will be to assess Mr. McComb is not intimidated surely add stress to what’s already had grown close with many employ- and knack for marketing to women the company’s existing talent pool. by Federated’s industry clout.He cut been an emotional year. Last De- ees there.He hopes to forge new ties to succeed in his new job. “My greatest strength is motivat- his teeth making deals for Tylenol cember, both his father and step- at Liz Claiborne. During his 14-year career at John- ing and energizing people to see the and Pepcid AC with Wal-Mart mother were diagnosed with termi- “We’ve entertained thousands of son & Johnson, the young executive possibilities,” he says. Stores Inc.,the world’s largest retail- nal cancer. His stepmother died in people in our house over the years,” generated huge sales among female Another priority will be helping er. He says Federated needs premier February. Even he was hospitalized he says. shoppers by introducing or reposi- the company’s flagship brand regain brands such as Liz Claiborne to “get recently,for a kidney stone,while in- tioning face soaps, moisturizers and its hip factor. The Liz Claiborne line the consumer in the front door.” terviewing for his new post. COMMENTS? [email protected]

October 23, 2006 | Crain’s New York Business | 33 BUSINESS LIVES

EXECUTIVE MOVES Good for Good for Good for one hour one day one night ACCOUNTING & CONSULTING AlixPartners: Matthew Cohen, 42, joined HOT JOBS as director, electronic discovery practice. He had been counsel at Skadden Arps Slate Meagher & Flom. WANTED: DIRECTOR OF VIDEO Scott Wilson, 54, joined as director, information technology transformation ADVERTISING services practice. He had been a principal at Deloitte Consulting. COMPANY Google Inc. Buchanan Associates: Tom Skelly, 55, joined as director of regulatory JOB DESCRIPTION A newly created New York position; the person select- Good for Good for Good consulting. He had been an investigator ed will develop the Internet giant’s global video advertising business one week six months ALL YEAR! for NASD Regulation. Eisner: Lawrence S. Zeff, 58, joined as tax MOST IMPORTANT TASKS Hire and manage a video ad sales team; ADVERTISE IN partner. He had been a managing create and execute a strategy to ramp up video ad revenues CRAIN’S BOOK OF LISTS 2007 director at RSM McGladrey. CREDENTIALS NEEDED Proven experience in interactive advertising, THE MOST WIDELY READ AND REFERENCED ISSUE OF THE YEAR. ADVERTISING & COMMUNICATIONS television or video ad sales, and marketing or promotions; experience at Reactrix Systems Inc.: Michael Ginn, 47, a top-ranked Web site preferred Call 212-210-0259 or visit newyorkbusiness.com to reserve your ad space. joined as vice president of sales for the SALARY Maximum base salary of $100,000 with unlimited commission Issue Date: December 25th Ad Close: December 1st Eastern region. He had been vice president, team business development, potential, recruiters estimate at the WNBA. RECRUITER Internal Siegel + Gale: Cynthia Reggio, 47, was DOWNSIDE Figuring out how to make a new medium—online video The Most Trusted Name in New York Business® promoted to director of the simplification group from senior advertising—work for advertisers strategist. UPSIDE Chance to grow a new business for a leading Internet company

REFEREE’S NOTICE OF SALE OF EDUCATION With more than $6 billion in annual ad revenues, Google has dominated 124 WEST 42ND STREET, NY NY SchoolNet Inc.: Luyen Chou, 39, joined as the search advertising market. Now, the Mountain View, Calif.-based com- To be held November 8, 2006 senior vice president of global networks, pany is aggressively moving into the video advertising market. It recently SUPREME COURT - COUNTY OF NEW YORK - Index Number 123407/2000 a newly created position. He was MORTON KASSOVER, Plaintiff against PAULA KASSOVER FIEDLER, et al, acquired popular video-sharing Web site YouTube for $1.65 billion. Defendant(s). Pursuant to a INTERLOCUTORY JUDGMENT entered herein on May 8, formerly executive director of the 2006, and an ORDER of the Hon. DEBRA A. JAMES, J.S.C., dated September 25, 2006, I, Center for Integrated Learning at —AMANDA FUNG the undersigned Referee will sell at public auction in ROOM 130 of the New York County Columbia University. Supreme Courthouse, 60 Centre Street, New York, NY on the 8th day of November, 2006 at 1:00 PM premises situate, lying and being in the Borough of Manhattan, County, City and State of New York; Beginning at a point in the southerly side 42nd Street, 225 feet west from FINANCE & INSURANCE the intersection of the south side of 42nd Street and the westerly side of 6th Avenue, being Stanford Group Co.: a plot 98 feet 9 inches by 25 feet by 98 feet 9 inches by 25 feet. Peter F.Homsher, 39, Said premises known as: 124 WEST 42ND STREET, NEW YORK, NY joined as senior vice president for National Sports Museum: John Urban,46, Slate Meagher & Flom. Premises will be sold subject to provisions of the filed judgment and Order and terms institutional research sales. He had been joined as president and general manager. Sullivan & Cromwell: Tia Barancik, 44, of sale. Bidders are advised they must submit a Bidder Qualification Form as available from Eve E. Monroe, Esq., the Referee named below on or before the day of sale. A "Qualified a director, institutional sales, at Ryan He was formerly senior vice president joined as special counsel. She was Bidder" shall be a person or entity that, prior to and at the Sale, submits a Bidder Beck & Co. and general manager at Radio City formerly a partner at King & Spalding. Qualification Form and shows to the Referee a bank, cashier's or certified check in the Jane T.Vieth, 48, joined as senior vice Music Hall. amount of $1,200,000. payable to or endorsed to the order of "Eve E. Monroe, Referee" Bidding will start at $10,000,000. president for institutional research sales. Waldorf Towers: Joel A. Freyberg,43, MEDIA & ENTERTAINMENT EVE E. MONROE, ESQ., Referee. She had been a senior vice president at joined as executive director. He had been American Express Publishing Corp.: Law Office of Eve Monroe PC, 625 East 11th Street, Suite A1, New York, New York 10009 Matrix USA. hotel manager at the Hotel Gansevoort. Darren Klein, 35, was named online sales Phone (212) 420-7536 director. He had been a managing HIGH TECH & NEW MEDIA LAW director, print and digital advertising, at Animation Technologies: Robin Snyder Dechert: Mark E.Thierfelder, 42, joined The New York Times. Dailey, 37, joined as litigation as partner. He had been a partner at Elle Decor: Dan Ragone, 42, was named consultant. She had been litigation O’Melveny & Myers. vice president and publisher of the graphics consultant at FTI Consulting. Dewey Ballantine: A. Paul Victor,67, Hachette Filipacchi title. He was Patrick Shea, 41, joined as litigation joined as partner. He was formerly a formerly associate publisher of Elle consultant. He had been lead designer partner at Weil Gotshal & Manges. magazine. and art director at Symbol Technologies. Kirkland & Ellis: Mukang Cho, 32, was Meredith Corp.: Rich Berenson, 40, was CashEdge Inc.: John Rogers, 48, joined as promoted to partner from associate. named a managing director in the chief financial officer. He had been chief Eric W. Dittman, 31, was promoted to corporate sales/Meredith 360° business financial officer, North America, at partner from associate. unit. He had been publisher of Child Logica CMG. Helena Huang, 35, was promoted to magazine. Tacoda: Michael H. Krogermeier, 39, partner from associate. joined as vice president, corporate Jordan N. Malz, 30, was promoted to REAL ESTATE strategy and development, a newly partner from associate. CB Richard Ellis: Keith Caggiano, 30, was created position. He had been senior Andres C. Mena, 34, was promoted to promoted to first vice president from director, corporate strategy and partner from associate. vice president. development, at PanAmSat Corp. F.Christopher Mizzo, 32, was promoted Edward Midgley, 46, was promoted to partner from associate. to first vice president from vice HOSPITALITY & TOURISM Young J. Park, 33, was promoted to president. Millennium UN Plaza Hotel: Mark R. partner from associate. Hypo Real Estate Capital Corp.: Peter Irgang, 43, was promoted to general Kramer Levin Naftalis & Frankel: Eve Castro, 32, joined as director, mezzanine manager from hotel manager. Preminger, 70, joined as counsel. She loan lending. He had been a vice had been a surrogate judge for New York president at the Société Générale. County. Tarragon Development Corp.: Jim LeClair Ryan: Michael T. Conway,43, Erlacher, 46, joined as executive vice joined as partner. He had been a partner president of development. He had been at Lazare Potter Giacovas & Kranjac. senior vice president of development at Andrew J. Frisch, 50, joined as partner. Marriott International Inc. He had been senior litigation counsel for the Eastern district of New York for the SERVICES U.S. Department of Justice. Falcon Pacific Construction: Andrew Paul A. Merolla, 59, joined as partner. He McKessey, 29, joined as controller. He had been executive vice president and had been manager of accounting services general counsel at Instinet Group Inc. at Gorton Associates Inc. Proskauer Rose: Timothy L. Porter, 60, Hale House Center Inc.: Annie Murphy, joined as senior labor and employment 39, was promoted to deputy director Office & Retail counsel. He had been chief counsel for from director of development. Availabilities: labor, employment and environment and —adrianne pasquarelli vice president, law, at AT&T. Reed Smith: Patrick de Carbuccia, 36, 212.594.2700 EXECUTIVE PROMOTIONS joined as partner. He was formerly an slgreen.com associate at Wilkie Farr & Gallagher. The fastest way to get an announcement into Michael Pollack, 48, joined as partner. He Crain’s is to submit the information online. was formerly a partner at Withers Reaching New Heights. Go to www.newyorkbusiness.com and click on Bergman. “Executive Moves”; then click on the link to fill James Tandler, 40, joined as partner. He out the submission form. The Executive Moves was formerly counsel at Skadden Arps column is also available online.

34 | Crain’s New York Business | October 23, 2006 BUSINESS LIVES TABLE TALK by Bob Lape wings can serve as an intro to what American South in a pint-sized lies ahead. BEST OF BOB LAPE powerhouse of warmth. Family Side dishes are splendid examples dishes,fine drinks,daunting desserts. of Southern/soul savories at their New York area restaurants offering most flavorful;you get two with each Southern and soul food or barbecue— New York Kom Tang ★ ★ entrée. Black-eyed peas and collard American or otherwise: 32 W. 32nd St. (between Broadway greens are exceptional.There’s plen- and Fifth Avenue), Manhattan. ty of ham bits and resulting flavor in Bengal Tiger ★ ★ ★ (212) 947-8482. New York’s oldest the baked beans,and this is surely the 144 East Post Road (between Korean restaurant is great fun for place to finally learn to like lima Court Street and Mamaroneck hands-on barbecue buffs who like beans and/or candied yams.It was for Avenue), White Plains. their Asian food full of flavor and, me. The potato and egg salad is (914) 948-5191. Simson Kalathara’s sometimes, fire.The first floor is for agreeable.Only bland,dry macaroni 31-year romance with White Plains sushi; the charcoal braziers glow at and cheese fails to meet expectations. results in the best Indian restaurant second- and third-floor tables. Desserts ($5) touch on tradition- outside New York City and one of al Southern bases such as red velvet the best in America. One feature: The River Room ★ ★ cake—not available on one visit— an open tandoor kitchen. Riverbank State Park, Riverside and pecan pie that was nutty almost Drive (at West 145th Street), Man- to a fault and, for that matter, near- Tamarind ★ ★ ★ hattan. (212) 491-1500. Park at the ly burned.There is a seriously dense 41-43 E. 22nd St. (between Broad- park for casual elegance, live jazz, banana pudding containing both way and Park Avenue South), first-rate contemporary Southern/ banana slices and broken sugar Manhattan. (212) 674-7400. Terrific soul cuisine and stunning sunset cookies. Coconut-pineapple cake, tandoor dishes are but one facet of scenes of the upper Hudson and carrot cake and sweet potato cheese- the appeal of Avtar Walia’s four- the George Washington Bridge. ■ cake have their moments,but my fa- year-old Flatiron favorite. vorite is frozen lemon cake.The cool citric kick is a tonic after the prodi- Ono ★ ★ ½ gious intake of earlier courses. Hotel Gansevoort,18 Ninth Ave.(at Rack & Soul’s beverages include West 13th Street), Manhattan. a passing nod to wines, offering 10 (212) 660-6766. Mega-restaurateur of them,most under $25.Among six Jeffrey Chodorow’s stunning neo- beers,there are notable options such Japanese showplace adds 400 seats as Abita (Louisiana), Red Stripe in the meatpacking district.A pleth- ( Jamaica) and Gosser, an esteemed ora of small plates, bigger plates for

buck ennis Austrian pilsner. sharing, superior sushi and sashimi, WHERE THERE’S SMOKE, THERE’S BBQ: Restaurateur Michael Eberstadt has teamed fried- The restaurant pays attention to and notable robata-grilled items. chicken maven Charles Gabriel (above) with Mississippi pit meister John Wheeler at Rack & Soul. kids, offering them special menus, and a warm and friendly staff caters Maroons ★ ★ to the needs of hungry youngsters of 244 W. 16th St. (between Seventh all ages. and Eighth avenues), Manhattan. (212) 206-8640. Full-flavored, home- New soul mates COMMENTS? [email protected] style cooking of Jamaica and the juice up W. Side M&K BUSINESS HEROES KNOWLEDGE | INTEGRITY | RESPONSIVENESS Casual combination Gabriel says he and his siblings all cook the way their mother taught of top-notch Southern them in North Carolina. In addition to partnering in Rack food, BBQ hits the spot; & Soul, Messrs. Eberstadt and Gabriel are replacing Bayou with a learn to love a lima branch of Charles’ Southern buffet. Entrepreneur Bob Pittman gets nominate restaurateur the credit for introducing Mr.Eber- Michael Eberstadt for the stadt to pit master Wheeler’s work. Easy-to-Like Eats Award of Some months ago,Mr.Pittman flew RACK & SOUL OUR M&K HERO Excellence.Mr.Eberstadt re- some Wheeler “Q” from Mississip- 2818 Broadway (212) 222-4800 NAVIGATES CLIENTS ally knows how to package pi to a party for displaced Southern- ★★ THROUGH THE FIRM’S Igood taste in appealing and reason- ers in New York. One thing led to UNIVERSE OF SERVICES. able formats. another, and John Wheeler brought First, his double-decker at Len- his 4,500-pound smoker to New CUISINE BBQ, Southern/soul ox Avenue and West 125th Street York, returning several times a WINES 10 choices, 10 by the combined Cajun-Creole restaurant month to make quality and tech- glass Bayou with his popular pizza pur- nique tweaks. veyor, Slice of Harlem. Now he has Rack & Soul is meeting the stan- DRESS Informal united New York’s fried-chicken dards, offering some of the best ribs NOISE LEVEL High king, Charles Gabriel, and Missis- in town: hefty, meaty short ribs and PRICE RANGE $10.95-$17.95 sippi barbecue whiz John Wheeler. lean, succulent baby backs.The aro- In the real world, we’re CPAs. The delicious result is Rack & Soul, matic smoke treatment,which com- WINE MARKUP 150%-250% To our clients, we’re Superheroes. a casual, user-friendly, delicious bines apple wood and charcoal, is CREDIT CARDS All major destination in Columbia University also used for pork and poultry— country. both whole chickens and chicken RESERVATIONS Not accepted This is the first move downtown, wings. HOURS Lunch Mon.-Fri., and sort of, for chef Gabriel, who started Complementing the splendid weekend Brunch, 11 a.m.-4 p.m.; MARCUM & KLIEGMAN LLP selling his home cooking from a table barbecue,Charles Gabriel’s wrought- Dinner, Mon.-Sat., 4-11 p.m., Certified Public Accountants & Consultants on a Harlem street corner a dozen iron fry pans send forth chicken and Sun., 4-9:30 p.m. years ago. He graduated to a truck at catfish for the ages.This is hands-on 800.921.0777 | www.mkllp.com ★★★★= Outstanding the corner of St. Nicholas Avenue food of the highest order,with gold- ★★★ NEW YORK and West 124th Street,and five years en crisped skins and moist, juicy in- = Excellent MELVILLE STAY TUNED FOR ★★ THE NEXT INSTALLMENT OF later opened Charles’Southern Style teriors. Not greasy, just great! = Very good GREENWICH ★= Good GRAND CAYMAN M&K BUSINESS HEROES Kitchen at Eighth Avenue and West There are no appetizers as such 151st Street.One of 20 children,Mr. at Rack & Soul, but the chicken

October 23, 2006 | Crain’s New York Business | 35 BREAKBREAK FREEFREE FROMFROM HOTSPOTSHOTSPOTS

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