20150126-NEWS--0001-NAT-CCI-CN_-- 1/23/2015 7:45 PM Page 1

REPORT TOURISM SIX STARS? Baccarat stakes its claim CRAIN’S® PAGE 15 BUSINESS

VOL. XXXI, NO. 4 WWW.CRAINSNEWYORK.COM JANUARY 26-FEBRUARY 1, 2015 PRICE: $3.00 Fairway must find its way FPO Famed grocer’s stock cheaper $3.71 than a half gallon of milk last week. Meet newest CEO per share

BY AARON ELSTEIN istock / The fate of one of New York’s most revered retailers, Fairway Markets, is now in the hands of a veteran grocer who decorates his office with hel- mets used by New England Patriots star Tom Brady and loves going to $3.89 “Fenway Pahk” to see his beloved “Red Sawx.” “I’m so honnah-ed to have the opportunity to turn around Fairway,” AS OF 1/20/15 said Jack Murphy, 66, in his first interview since becoming the super- market’s third chief executive in less than a year. It might come as news to its legions of fans that Fairway is in need of a turnaround, or that the company, which closely identifies itself with crain composite image:crain buck ennis the hustle and bustle of New York, has turned to a Bostonian for a res- See FAIRWAY on Page 23 Tarnished Silver: Speaker’s arrest upends most everything in Albany At stake: school funds, rent regs, tax breaks, tort reform, ethics law

lawmakers and lobbyists scrambling ally and by others EDITORIAL: BY ANDREW J. HAWKINS to decipher what it will mean for the as a quixotic obsta- ENOUGH legislative agenda. cle. His alliance ALREADY The arrest of Assembly Speaker Mr.Silver,an assemblyman since with trial lawyers PAGE 12 Sheldon Silver Thursday sent shock 1976 and speaker since 1994, has has blocked re- GREG DAVID: waves through New York, leaving been seen by his friends as a reliable forms craved by WHAT, WHEN business interests, DID CUOMO KNOW? POWER PLAY:

04 while his support Assembly PAGE 13 Speaker Sheldon Silver faces 5 for the teachers’ union has kept ed- corruption charges over $6 million in payments from ucation reformers at bay. law firms and developers. But the corruption,fraud and ex- tortion charges against him will

See SILVER on Page 24 ap images NEWSPAPER 71486 01068 0 20150126-NEWS--0002-NAT-CCI-CN_-- 1/23/2015 7:46 PM Page 1

MANAGING EDITOR’S NOTE

Fare game FYICRAINSNEWYORK.COM

If it seems as though transit fares are getting more expensive every Silver arrest (other) year, that’s because they are. And not just because the lengthens shadow Metropolitan Transportation

over major nonprofit met council Authority voted last week to charge $2.75 for a subway ride, the third he criminal charges engulfing Assembly Speaker Sheldon Silver are another blow to a once-prominent social-services organization with which he had deep ties: the Metropolitan Jeremy Smerd consecutive biennial increase. Fares are climbing faster (and faster) than Council on Jewish Poverty. ¶ The Met Council has been struggling since its former CEO, TWilliam Rapfogel the cost of living. Increases every (pictured with Mr. Silver), was sentenced last year to up to 10 years in prison for two years are now baked into the transit authority’s embezzling $9 million from the group. Mr. Silver was longtime friends with Mr. Rapfogel, who budget planning. But how much they go up and who was at the organization for 20 years and whose wife, Judy, is Mr. Silver’s chief of staff. During Mr. takes the hit remains a guessing game. Pegging the Rapfogel’s leadership, the organization received millions of dollars in state funding for its services, hike to inflation would at least make it predictable. which were widely acknowledged to help New Yorkers in poverty, regardless of race or ethnicity. The $2.50 base fare of two years ago would now be And Mr. Silver was a centerpiece at the Met Council’s annual legislative breakfast, a must-attend less than $2.60 if it were tied to the consumer price event for New York’s elected leaders. ¶ After Mr. Rapfogel’s downfall, the Met Council hired as index, and a 30-day unlimited-ride MetroCard CEO former city Finance Commissioner David Frankel, but in August the news broke that Mr. would cost a dollar less than what the MTA said it Frankel would leave his post after a successor was found. He is still there. Sources said the council will starting March 22: $116.50. Sure, pegging fares had been seeking either to merge or outsource the services it provides for about nine months.¶ Mr. to an index would give the MTA less room to raise Frankel’s hiring appears to have been another misstep. He had no real background in social revenue. Had the 10-cent fare of 1948 kept pace with services and lacked Mr. Rapfogel’s political connections and fundraising prowess, making him a costs, riders would be still be forking out $1 a ride— poor fit for the organization. ¶ “It is always hard to follow a star leader,” said the nonprofit or the price of a token in 1986. But tying rates to the executive. “It is even harder to follow a star who was a crook.” ¶ A spokeswoman for the council actual cost of living would give elected officials less said last year every social service it provided was either expanded or transformed for the better. ¶ political cover to underfund the transit system— “We are fiscally sound and are proud to have achieved these goals,” she said. —theresa agovino either through the fare box or the budget bill.The Independent Budget Office last week suggested that TRAIN TO THE PLANE. Gov. Andrew ter group intends to sue,delaying any Cuomo proposed building an Air- sale of the company. … MARINA HOORAY! the MTA’s ad hoc funding absolves the city (and Train to link the No. 7 subway at OPERATOR. Brookfield Properties POPE Albany) from contributing to the economic engine Willets Point,Queens,to LaGuardia will pay $4.5 million over 10 years, FRANCIS will visit New York that drives New York. Had the city’s $136 million Airport, which is accessible only via plus an upfront capital-improve- City in bus or car. Construction would be ment fee of $450,000, to run the September. contribution to the MTA’s first capital plan in 1982 handled by the Port Authority of North Cove Marina in Battery Park kept up with inflation, the de Blasio administration’s New York and New Jersey and cost City, beating out former operator obligation would be $363 million today. Instead, it’s $450 million, and would take five North Cove Marina Management, $100 million, the same since 2010 and less than what years. … S&P SETTLEMENT. Standard which claims Brookfield won only & Poor’s will pay $77 million to the because of political favoritism. … it was 30 years ago. Now that’s hardly fair fare. Securities and Exchange Commis- STRIKE AVERTED. Nearly all the sion and the attorneys general of workers at the Hunts Point Terminal New York and Massachusetts to set- Produce Market in the Bronx voted OY VEY! THIS WEEK IN CRAIN’S tle allegations that it misled investors in favor of a three-year contract that CASH-STRAPPED Mets owner Fred Wilpon, who lost $700M in Bernie Madoff’s Ponzi after the 2008 finan- provides raises of at scheme, was named chairman of Major cial crisis.The agency least $20 a week,nar- IN THE BOROUGHS------3 ‘I have no League Baseball’s Finance Committee. will be barred from rowly avoiding their IN THE MARKETS------4 rating commercial more first strike in nearly UBER THE INSIDER ------6 mortgage-backed se- 30 years. … curities for a year. … campaigns to TREASURE CHEST. SMALL BUSINESS ------6 BONUS FOR DIMON. run … The car-hailing app BUSINESS PEOPLE ------8 JPMorgan Chase has raised $1.6 bil- CEO Jamie Dimon because I won lion in convertible ap images; bloomberg news OPINION ------12 received a $7.4 mil- both of them’ debt from clients of ALAIR TOWNSEND ------lion cash reward in Goldman Sachs’ pri- Places to Work in New York. … 13 —President Barack 2014, his first bonus vate wealth arm, SACRE BLEU! Paris Mayor Anne GREG DAVID------13 Obama, to GOP hecklers in three years.His to- during his State of the adding to its $2.8 bil- Hidalgo plans to sue Fox News for REPORT: ------15 tal pay was un- Union speech lion in equity fund- inaccurately reporting that the city changed, at $20 mil- ing. It has amassed has Muslim-run “no-go zones.” … NEW YORK, NEW YORK THE LIST ------17 lion. … OPERA’S GROUNDBREAKING. Construction Kevin McCollum has a hand more than any other REAL ESTATE------CADENZA. began for a 51-story, 1.3 million- in several 19 The bankrupt New York private company backed by venture City Opera said it wants to sell its capital. … SHAZAM SHIMMIES. The square-foot building at 55 Hudson productions this season. P. 25 SOURCE LUNCH------26 name and assets to NYCO Renais- music-finding app raised $30 mil- Yards.The tower is being developed CORRECTIONS sance, which bid $1.25 million— lion, sending its valuation to more by Mitsui Fudosan America,the Re- Citigroup has failed the federal banking “stress test” in two of the past three years. This $250,000 less than a rival group led than $1 billion. Last year, Crain’s lated Cos. and Oxford Properties. information was misstated in the deck of the Jan. 19 “‘Stress test’ puts pressure on Citi.” by architect Gene Kaufman.The lat- named Shazam one of the Best —emily laermer Only 7% of primary care physicians in the U.S. owned a stake in a single-specialty practice in 2014, down from 12% in 2012. The year of comparison was misstated in the Jan. 19 “Primary care doctors find it’s not easy to stay independent.”

vol. xxxi, no. 4, january 26, 2015—Crain’s New York Business (issn 8756-789x) is STORIES TO WATCH THIS WEEK published weekly, except for double issues the weeks of June 29, July 13, July 27, Aug. 10, Aug. 24 and Dec. 21, by Crain Communications Inc., 685 Third Ave., New York, NY 10017. Periodicals postage paid at New York, N.Y., and additional mailing offices. Post- Jan. 26: Met Jan. 27: Hearing Jan. 27: Joint Jan. 29: Hearing master: Send address changes to: Crain’s New York Business, Circulation Department, 1155 Museum to sell on city’s efforts legislative hearings on release of Gratiot Avenue, Detroit, MI 48207-2912. for subscriber service: Call (877) 824-9379.Fax (313) 446-6777.$3.00 a copy,$99.95 one $250M of taxable to revitalize area begin on 2015-16 grand-jury year, $179.95 two years. (GST No. 13676-0444-RT) ©Entire contents copyright 2015 by Crain Communications Inc. All rights reserved. debt to fund infra- around S. B’klyn state executive transcripts in Eric structure projects Marine Terminal budget. Garner case

2 | Crain’s New York Business | January 26, 2015 20150126-NEWS--0003-NAT-CCI-CN_-- 1/23/2015 7:47 PM Page 1

IN THE BOROUGHS Tattoo you: Upper East gets hip Low rents attract a (far) younger crowd and shops to match

BY ADRIANNE PASQUARELLI

When Kathryn Creech moved from North Carolina to New York three years ago, she picked a place on the for its affordabili- ty—and because of her blissful igno- rance of the neighborhood’s rock- bottom ranking on the hip scale. “If I’d known then what I know now,I don’t think I would have end- ed up on the Upper East Side. It has that uncool stigma,” said the 27- year-old, who works as a baker in Feeling blue, boxed in (infinitely cooler) Greenpoint, Brooklyn. But last year, when she and her husband, who also works in Strong dollar, aging boomer market combine to shrink jeweler’s sales Brooklyn, wanted to move to a new place, they didn’t look far. Instead, they packed up and moved to a one- BY ADRIANNE PASQUARELLI bedroom apartment eight blocks south, on East 77th Street. The stockings were hung by the chimney with care, but as it turned out, few little blue boxes lay over there. “We have a community here,” Tiffany & Co., the jeweler famous for pricey baubles and the turquoise-hued boxes they come in, shocked she said, noting that in recent investors on Jan. 12 by reporting a 1% drop, to $1 billion, in crucial holiday sales.The news sent stockhold- months a number of bars and restau- rants with a “downtown vibe” have ers stampeding for the exits, driving the share price down 14% on the day. Last Friday, it closed at $91.08, opened nearby. down 18% from Tiffany’s November 52-week high. See TIFFANY on Page 24 Long associated with stuffy sen- iors and well-to-do ladies who lunch, the mix on the Upper East Side now includes its share of peo-

buck ennis See UES on Page 22 These top trending gigs help STATS AND THE CITY by Nicholas Wells IN THEIR NAMES: Streets in Brooklyn were named after police officers Rafael Ramos and Wenjian Liu, who were slain in December. Last week, the City city’s economy hit its stride Council approved the co-naming of 54 other streets. TOTAL number of streets co-named in steadily progressing for a number of 1,544 honor of heroes or events between Software developers years,” said James Brown, an analyst 1998 and 2013 top the list of New for the state Department of Labor. These hot jobs contributed to an- PORTION co-named for women, including York’s hottest jobs other month of better-than- Harriet Tubman and Jane Jacobs expected hiring,with the unemploy- 22% ment rate holding steady at 6.3%, BY NICHOLAS WELLS according to Labor Department sta- PORTION of tistics released for December. 26.8%honorific streets Silicon Alley is adding to New But the year’s momentum was designated in Staten Island between 1998 and 2013, York’s cool and padding the wallets istock not enough to continue the five- of its workers. Software developers month streak of unemployment- the highest amount in earn a median income of $107,300 a ficiaries of significant help from the rate declines, and the city’s 93,500 the city for that year, according to a list of five government, receiving both subsi- seasonally adjusted jobs added in NUMBER period “trending”jobs for 2015,released by dies and tax breaks for establishing 2014 fell short of midyear forecasts. 22of city workers the Department of Labor last week. or expanding their operations local- One reason is that financial serv- employed to produce up to 12K The trending city jobs are those ex- ly. Tech companies in the city re- ices, once the undisputed backbone street and traffic signs per month pected to see greater-than-normal ceived roughly $32 million from the of the city’s economy, added just median wage increases through the state between 2011 and March 4,100 jobs since December 2013,af- APPROX. AMOUNT end of the year. 2014. In April 2013, the state ex- ter two years of minimal change. NYC is spending to replace Sources: City Council, Along with software developers, tended legislation through 2019 al- With economic uncertainty in Asia $27.5M nycstreets.info, Gotham street signs to adhere to federal guidelines Gazette, NYC Dept. of the state named film and video edi- lowing it to distribute $420 million and Europe, Labor Department Transportation, Daily News tors, who earn a median of $70,420 a year to the film industry. economist Elena Volovelskaya istockphoto in the city.Like movie and television “Obviously, tax credits have called for caution in assessing the ADDICTED TO NUMBERS? GET A DAILY DOSE AT @STATSANDTHECITY studios, technology firms are bene- helped, but the industry has been See JOBS on Page 23

January 26, 2015 | Crain’s New York Business | 3 20150126-NEWS--0004-NAT-CCI-CN_-- 1/23/2015 7:48 PM Page 1 IN THE E. Village dive bar Continental MARKETS files for bankruptcy—again by Aaron Elstein

The former music 1991. But soaring rents gradually put the East Village’s rock clubs out venue has struggled of business, and Mr. Smith decided LIQUIDNET’S SETH it was time to change with the MERRIN: Big traders to keep up with times, too. are “tired of getting taken advantage of.” the changing area Legal troubles October 2006 marked the end of BY YOONA HA an era of live music shows at the Continental. Mr. Smith gave the The Continental Bar in the East outpost at 24 Third Ave. a “classy Village hosted some of rock’s great- dive bar” makeover. A jukebox re- est hit-makers before they were well placed the bands. But a dispute over known. The Ramones, , jukebox revenue eventually snow- Patti Smith, the Wallflowers and IGGY POP is among balled into a lawsuit that went on for Guns N’Roses are among the artists the rock icons who about seven years. and bands who once played on its appeared at The lawsuit ended in arbitra- stage. Continental. tion, with $49,762.96 awarded to Even after a makeover replaced PLK Vending, owned by Kenneth ap images

the stage with leather booths, the Goldberg. Ronald Koppelman, an bloomberg news dive bar remained a destination for attorney representing Mr. Gold- cheap drinks. ‘I love this bar berg, described the lawsuit as But the good times may be over. “ridiculous” for taking as long as it The bar filed for Chapter 11 bank- more than did. Banding together ruptcy last month, its second filing Mr. Smith said the suit dealt a since 2009, claiming $117,000 in anything except huge blow to his business. liabilities. “This jukebox battle was not only vs. speed demons for my dog’ financially devastating but has tak- Staying open en its toll on me emotionally, spiri- “The entire thing is surreal to —Trigger Smith tually, morally and ethically,” said ast year, author Michael Lewis famously declared the me,” said Trigger Smith, who owns Mr. Smith. and operates the bar under his He said he will “do everything in stock market “rigged,” asserting that a handful of company, Third Ave. & St. Mark’s my power to keep this bar going.” traders using sophisticated high-speed strategies are Inc. “I love this bar more than any- L relentlessly ripping off investors who can’t move so fast.That The bar,known for its five-shots- side his manager,“Bingo,” and six to thing except for my dog,” said Mr. raised the question: If things are really so bad, how come for-$10 deal and $2 picklebacks,will seven employees a night. Smith.“I spend more time here than continue to operate—for now. Mr. A musician, Mr. Smith said I do at home, and I spend more time firms that manage trillions’ worth of investor money aren’t Smith is often seen working the door there was nothing more exciting here with my staff and my regulars talking about getting fleeced? wearing an Asian conical ,along- than having a small rock club in than I do with my family.” Ⅲ We got at least a partial answer to that question last week. That’s when it was reported that Fidelity, BlackRock, JPMorgan Chase, T. Rowe Price and five other major money managers are close to forming their own trading venue so high-speed traders don’t interfere with their transactions. The four named firms manage about $9 trillion in investor

funds,so any trading place they cre- situation at its dark pool, which is ate by definition is a big deal. the second-largest in the nation. “The development shows big That agreement came days after NEW YEAR. buy-side firms are tired of getting another $14 million settlement in- taken advantage of,”said Seth Merrin, volving BATS Global Markets. The CEO of Liquidnet, a Manhattan- SEC said a marketplace acquired NEW OPPORTUNITY. based company that competes with by BATS granted unfair advan- high-speed trading outfits. tages to certain high-speed traders. Word of the new trading place Finally,last week New York At- Cassidy Turley is now DTZ came a few days after torney General Eric Schneiderman got fresh reminders of what Mr. filed an amended lawsuit against Lewis meant when he called the Barclays, which he charged last June stock market rigged. with lying to dark-pool customers Welcoming a On Jan. 15, Swiss bank UBS by saying it would provide them agreed to pay $14 million to settle with protection from “predatory” world of opportunity Securities and Exchange Commission high-speed traders when in fact it charges that it failed to tell all cus- did no such thing. In his updated for our clients and our people tomers the rules of the road at its complaint, Mr. Schneiderman for in New York Tri-State Region high-speed trading venue, called a the first time identified Barclays dark pool. As a result, some UBS executives involved in the allegedly customers were able to place orders deceptive activity. in the dark pool faster than others, This is shaping up to be a doozy who were left behind to trade at in- of a fight. Barclays is contesting the Experience local market leadership ferior prices.The tilted playing field charges vigorously and said Mr. on a global scale. lasted from 2008 through 2012, ac- Schneiderman’s update suit “repack- cording to the SEC. Bank officials ages the same flawed arguments that Peter B. Hennessy said UBS has straightened out the were in the original complaint.” Ⅲ President, New York Tri-State Region +1 212 318 9790 ANALYSTS’ www.dtz.com ESTIMATE of the loss at Citigroup after Global Commercial Real Estate Services $150M officials at Switzerland’s central bank allowed the Swiss franc to rise in value against the euro. Last week, Citi’s CFO

istockphoto confirmed the bank suffered a “modest loss.”

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Activation fee/line: Up to $35. IMPORTANT CONSUMER INFORMATION: Corporate Subscribers Only. Subject to Major Acct Agmt, Calling Plan & credit approval. Up to $350 early termination fee. Offers & coverage, varying by svc, not available everywhere; see vzw. com. While supplies last. Restocking fee may apply. Bill credit may take up to 2–3 billing cycles to appear. Credit will be removed from account if line is suspended or changed to non-qualifying price plan after activation. DROID is a trademark of Lucasfilm Ltd. and its related companies. Results based on third-party study. Used under license. © 2015 Verizon Wireless. I3011 20150126-NEWS--0006-NAT-CCI-CN_-- 1/23/2015 2:09 PM Page 1 THE that the campaign was conducted ful- INSIDER ly aboveboard, legal counsel experi- by Chris Bragg enced in these matters was engaged.” An Advance Group spokesman said,“We are proud to have played a role in the historic victory which Another speaker faces probe elected Melissa Mark-Viverito speaker of the City Council.” ew York City Council Speaker Melissa Mark-Viverito The Advance Group was not the and one of her former political consultants are only lobbying firm to help. Early in Ms. Mark-Viverito’s speaker bid, an subjects of a city ethics probe, Crain’s has learned. employee from another lobbying

N ap images The investigation is noncriminal, unlike the one that snared firm close to Ms. Mark-Viverito, Assembly Speaker Sheldon Silver last week. Conducted by the the MirRam Group,handled an inquiry Conflicts of Interest Board from Crain’s for a story about her count for an unspecified city office, pear dim: She is term-limited, and city’s , it centers around free advice past refusal to recite the Pledge of and Ms. Mark-Viverito raised more no seats for borough president or Ms. Mark-Viverito got during her 2013 race for speaker, two Allegiance. MirRam also was not than $100,000. citywide office are expected to be sources with knowledge of the matter said. paid for work on the speaker race. That led another good- open. She recently began raising MirRam maintains the work was government group, Common funds at the level allowed for city- The speaker’s campaign fund re- controlled many members’ votes. related to Ms.Mark-Viverito’s 2013 Cause/NY, to charge that she had ex- wide candidates, but a source said cently paid $20,000 to Ballard Spahr The ethics question arose be- City Council bid—for which Mir- ploited loopholes in state election she was not considering running for Stillman & Friedman to represent her cause as a public servant,Ms.Mark- Ram was paid—though that cam- law.Ms.Mark-Viverito’s opponents one of those offices. She could run before the Conflicts of Interest Viverito is prohibited by the City paign had ended weeks before the in the speaker race did not similarly for retiring Rep. Charles Rangel’s seat Board,which has been deposing fig- Charter from taking a “valuable Crain’s inquiry. MirRam has since set up campaign funds to hire staff. in 2016,but could not directly trans- ures in the investigation. gift” from a firm that intends to do successfully lobbied Ms. Mark- But officials from Pitta Bishop say fer city campaign funds to a con- In the competition to succeed business with the city.Lobbyists are Viverito on behalf of other clients. the move was fully vetted by the city gressional account. as speaker, the Daily also prohibited from providing such In light of the scrutiny of Ad- Campaign Finance Board and state The Advance Group is also fac- News reported that Ms. Mark- gifts. The Advance Group has ex- vance Group’s pro bono work, Ms. Board of Elections. ing scrutiny for campaign activities Viverito’s pro bono help from the Ad- tensive lobbying business before city Mark-Viverito said in December The recent legal fees have eaten in 2013, including from the Cam- vance Group could violate a city ethics government,including the powerful 2013 that she would stop accepting up much of Ms. Mark-Viverito’s paign Finance Board,which recent- rule.Citizens Union called for the Con- speaker. free help from the firm during her fundraising during the past six ly fined former Advance Group flicts of Interest Board to investigate. A public official found to have speaker bid. The New York Observer months. The legal case might have client and animal-rights group The Advance Group had helped violated the rule can be fined up to later reported, however, that an Ad- been the primary purpose of her NYCLASS $26,000 for illicitly coordi- Ms. Mark-Viverito prepare for de- $25,000, and someone providing vance Group employee later played fundraising, given that her nating campaign activities with bates and network with council improper assistance up to $5,000. a role in brokering the deal that prospects for the 2017 election ap- Advance Group. Ⅲ members and county leaders, who By law, the Conflicts of Interest made Ms. Mark-Viverito speaker. helped decide the leadership race. Board cannot confirm or deny After the split with the Advance Ms. Mark-Viverito’s speaker bid whether a probe is ongoing. But a Group, Ms. Mark-Viverito made QUOTE OF THE WEEK: ‘It’s pro bono. ... had advantages, including support campaign spokesman for Ms. Mark- hefty payments to other consultants from Mayor Bill de Blasio,but she was Viverito said, “Although the Cam- (including lobbying and compliance Christopher will subsidize you’ Pitta Bishop not especially popular with council paign Finance Act permits individu- firm ) that aided her —Gov. Andrew Cuomo to his mother, Matilda, whom he named colleagues—from whom she need- als to volunteer their time to support speaker bid. In a novel move, Pitta the unpaid head of a state initiative, referring to his brother, a CNN anchor ed 26 votes—or county bosses, who a candidate, in order to demonstrate Bishop set up a 2017 campaign ac-

SMALL BUSINESS Small vendors turn to the ‘bank’ of Whole Foods

Lending program share the firm’s revenue. The loan, has made 248 loans nationally for a employee firm, based in Green- which he secured three years ago, total of $15.3 million so far. point, Brooklyn, makes com- makes inroads was key, he said. “It was important, Alternative funding sources like postable, biodegradable party table- not just because of the cash but be- the LPLP can be valuable to start- ware in partnership with nonprofits in cause it created a strong partnership ups and small businesses,said David that employ the blind and visually with Whole Foods.” Haber, chief executive and co- impaired. It isn’t profitable yet, but With small bank loans eluding founder of Bond Street, an online generates more than $1 million in BY EILENE ZIMMERMAN many entrepreneurial firms despite lender in New York City that makes revenue. The loan was used to pur- the healing loans of $50,000 to $500,000 to chase packaging and labeling ma- hen Daniel Sul- economy, the small businesses.A loan from a large chines. It also enabled the company livan, founder of LPLP offers 29% retailer gives the recipient credibili- to modify an existing machine so it beverage line Whole Foods’ PERCENTAGE ty by association, he said, and that is could cut paper for 16-ounce cups, of small firms TumericAlive, local vendors funded with the often just as valuable as the cash. “If which the founders wanted to add to needed a who need owner’s savings a business is selling at Whole Foods, their offerings. $35,000W loan for an automatic fill- growth capital that’s a great indicator of quality, That machinery allowed Susty ing machine at his Long Island City, an unusual alter- 100%,” said Mr. Haber. Party to launch two new products— Queens, bottling plant, he didn’t native. The re- PERCENTAGE23% Of course, borrowing from any red and yellow sets of tableware for turn to a bank.Instead,he borrowed gionally man- of small firms source comes with trade-offs. “The parties called party packs—into six the money from Whole Foods, aged program funded with only potential downside to taking regions, including the Northeast.

which carries his drinks, made with offers fixed-rate retained business money from your buyer is having bethany bandera Whole Foods’ buyers reviewed and organic turmeric root, throughout loans, mostly in earnings limited flexibility in the terms and WELL FUNDED: Daniel Sullivan secured a accepted them faster than they stores in the Northeast. The super- the $25,000 to becoming beholden to them for $35,000 loan from Whole Foods for new would have if the firm weren’t part market chain lends small vendors $75,000 range, your financing needs,” said Mr. equipment at his Manhattan beverage firm. of the LPLP, according to Ms. money through its fast-growing at about a 5% in- PERCENTAGE19% Haber. Doubilet. “To have a direct line to Local Producer Loan Program, or terest rate, said of small firms that To make sure borrowers thrive store demonstrations.“You get a fast these busy buyers helps us,as a small use credit-card LPLP,which was launched in 2007 Elly Truesdell, financing once they get funding,Whole Foods track to opportunity,” said Mr. Sul- business, navigate the landscape of and has recently seen rapid growth. the Northeast Source: Federal Reserve has twice since 2013 held its Local livan,who met his current manufac- selling into Whole Foods national- TumericAlive, a Manhattan- regional “local Bank of New York and Producer Loan Summit, an event turing partner, FreshBev, at the ly,” she said. Ⅲ partners, 10-state survey, based firm with 20 employees, is forager” for 2014 that brings together loan recipients 2014 loan summit in Seattle. now a national vendor to Whole Whole Foods. and buyers from around the country. Emily Doubilet and Jessica To sign up for Crain’s Foods. Sales in 2014 were triple The chain set out to lend $10 million The company also sponsors appear- Holsey, co-founders of Susty Party, SMALL BUSINESS newsletter, go to what they were in 2013, according but eventually committed to anoth- ances at farmers’ markets and re- received a $60,000 loan from Whole www.crainsnewyork.com/smallbiz. to Mr. Sullivan, who declined to er $25 million, said Ms.Truesdell. It gional showcases of vendors and in- Foods last April. Their four-

6 | Crain’s New York Business | January 26, 2015 CONGRATULATIONS LA CASA AZUL BOOKSTORE

ON YOUR $150,000 SMALL BUSINESS GRANT

We’re excited to announce that La Casa Azul Bookstore from New York City has been selected to receive $150,000 from Chase Mission Main StreetSM Grants.

La Casa Azul Bookstore is an independent bookshop Mission Main StreetSM Grants is a and community hub that celebrates Latino traditions, grant program from Chase that awards provides educational programs, and features locally $3 million to help businesses grow. made art. To learn more visit lacasaazulbookstore.com. To learn more about the recipients, visit missionmainstreetgrants.com. Join us in congratulating them with #MissionMainSt. Follow @ChaseSmallBiz and Like Chase on Facebook for updates.

JPMorgan Chase Bank, N.A. Member FDIC ©2015 JPMorgan Chase & Co. 20150126-NEWS--0008-NAT-CCI-CN_-- 1/22/2015 5:24 PM Page 1

BUSINESS

+31.4%Increase in self- employed NYC residents from 2000 to 2012, to nearly 250K PEOPLE Source: Center for an Urban Future

EXECUTIVE MOVES LOVE AT FIRST CrowdTwist: FLIGHT: Former Scott astronaut Michael Matthews, 53, joined Massimino fulfilled the software compa- his childhood dream ny as chief execu- of flying in space. tive. He was previ- ously chief executive at WebCollage. Novitas US: Nicole Noonan, 35, joined the family proceedings funding provider as chief executive. She was previously president at National Divorce Capital, which she founded. zkipster: Julian Jaeger, 44, joined the guest-list check-in app as chief busi- ness officer. He was previously direc- tor of partnerships at the Clinton Global Initiative. Health Republic Insurance of New York: Mary Jane Koren, 67, was appointed to the board of directors at the non- profit. She was previously vice presi- dent for long-term care quality improvement at the Commonwealth Fund. Luis Miranda, 60, was appointed to the board of directors. He is the founding partner at the MirRam Group. David Tucker Slingerland, 38, was appointed to the board of directors. He is the vice president of network strategy at Hudson Headwaters Health Network. Susan Stuard,44, was appointed to the board of direc- tors. She is the executive director of THINC. Friedman: Bruce Madnick, 69, was

buck ennis promoted to chief executive at the accounting, tax and GOTHAM GIGS advisory firm. He was previously managing partner. Jeff Agranoff, 37, was promoted to chief operating officer. He was previ- ously principal of human resources. Frederick Berk, 56, was promoted to co-managing partner. He continues as Watch this space co-chair of the real estate practice. Harriet Greenberg, 58, was promoted to co-managing partner. She was pre- viously a partner. Ex-astronaut takes on educational role at Intrepid WhyHunger: Noreen Springstead,46, was promoted to executive director at Michael Massimino can finally smile at a certain exploring the telescope’s history and discoveries. ¶ the nonprofit. She was previously Hoping managing director. handrail now displayed behind Plexiglas. In 2009, He and his crew have held discussions at the Fordham University Law School: to inspire when he was floating 350 miles above Earth Intrepid, where there’s video of him training Matthew Diller, 45, joined the law school as dean. He was previously trying to fix the Hubble Space Telescope, the 19 underwater for space walks. He wants to inspire dean at the Benjamin N. Cardozo the next inches of aluminum refused to budge, blocking a young people to study math and science. ¶ “Kids School of Law at Yeshiva University. Lincoln Center for the generation panel and jeopardizing a repair project. ¶ “I could think it’s fun when they see me monkeying Performing Arts: see what the textbooks would say: ‘We would around in the water,” said Mr. Massimino, who David Link,46, of cosmic know the age of the universe but we don’t because teaches engineering at Columbia. “But you can’t joined the arts cen- ter as chief digital travelers Gabby and Daniel’s dad broke the Hubble be an astronaut without math and science.” ¶ Mr. officer. He was pre- telescope,’ ” said Mr. Massimino, 52, the new Massimino was mesmerized watching Neil viously creative director at the senior adviser for space programs at the Intrepid Armstrong on the moon. He was so enthralled Wonderfactory, Sea, Air & Space Museum. “You don’t want to be with the idea of becoming an astronaut that his which he co-founded. Christie’s International: Derek the one who screws up fixing the most important older brother bought him a Snoopy doll dressed Gillman, 62, joined the auction house piece of scientific equipment ever.” He used tape up as one—a toy that traveled in space with its as chairman for Impressionist and as part of the solution. “Who knew we had tape in owner. ¶ Mr. Massimino was thrice rejected modern art, a newly created position. He was previously executive director an outside toolbox on the shuttle?” he said. ¶ Mr. before NASA accepted him. He retired last and president at the Barnes Massimino, who has a Columbia undergraduate summer after 18 years. ¶ “It’s hard to give up your Foundation. MHP Real Estate Services: Brian Fen- degree and a Massachusetts Institute of Technol- childhood dream job,” he said. “But there was nelly, 51, joined the commercial real ogy doctorate, co-curated Hubble@25, an exhibit more I wanted to do.” —theresa agovino See EXECUTIVE MOVES on Page 10

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BUSINESS PEOPLE

in its antitrust and government investi- an associate. EXECUTIVE MOVES gations practices. She was previously Michael Berengarten, 34, was promoted to CORPORATE LADDER assistant chief of the antitrust division partner. He was previously an associate. Continued from Page 8 in the New York office of the U.S. Efram Friedman, 37, was promoted to estate firm as managing director. He Department of Justice. partner. He was previously an associate. was previously a director at Newmark Erin DeCecchis, 37, was promoted to Alan Lyons, 43, was promoted to partner. TECH VETERAN DEVELOPS Grubb Knight Frank. counsel. She was previously an associate. He was previously counsel. Dattner Architects: Steven DiCesare, 38, was promoted to CH2M HILL: Jonathan NEW SYSTEMS FOR AD E-SPACE Sara Agrest, 42, was counsel. He was previously an associate. Goldstick, 56, was AS THE RECENTLY APPOINTED CHIEF TECHNOLOGY OFFICER at Collective, John promoted to director Cecily C. Williams, 41, was promoted to named area manager of interiors at the counsel. She was previously an associate. of the global engineer- Vandermay, 50, is making his first foray into the ad-tech space. However, his architectural firm. She Fried Frank Harris Shriver & Jacobson: ing firm’s New York experience with technology and software development dates back to college, was previously senior Evan Barr, 51, joined the law firm as a City office. He con- when he built systems for landing aircraft at commercial airports. associate. partner. He was previously a partner at tinues as the compa- Since then, Mr. Vandermay has managed teams of five to 400 people, held LIN Mobile: Jonathan Steptoe & Johnson. ny’s lead for water- roles as head of engineering and development at Omniture and, most recently, Schwartz, 36, joined Lawrence Gerschwer, 53, joined as a front projects and as vice president of product development at Dassault the mobile advertising-solutions partner. He was previously a partner at coastal resiliency initiatives. provider as director of publisher devel- Morrison & Foerster. Carter Ledyard & Milburn: Victor J. Gallo, Systèmes Geovia. opment. He was previously general Mark Lucas, 37, joined as a partner. He 48, was promoted to partner. He was At Collective, he’s been tasked with creating manager of owned-and-operated sites was previously vice president and asso- previously of counsel. software that promotes transparency, such as at Bankrate Inc. ciate general counsel of the merchant- Bryan J. Hall, 30, was promoted to part- a client-facing platform where users can Popular Mechanics: Michael Wilson,32, banking division at Goldman Sachs. ner. He was previously an associate. monitor workflow and ad performance. joined the magazine as design director. Mona Simonian, 36, Golenbock Euseman Assor Bell & Peskoe: “Collective plays a significant and strategic He was previously design director at was promoted to part- Michael Munoz, 36, was promoted to role in a rapidly changing industry,” said Mr. . ner. She was previous- partner in the litigation/alternative Marie Claire: Jen Ortiz, 28, joined the ly an associate. dispute-resolution practice group at the Vandermay. Mobile advertising spending magazine as senior editor. She was pre- WeiserMazars: Ethan law firm. He was previously an associate. is projected to double to $36 billion viously an editorial associate at GQ. Kahn, 41, joined the Jones Day: Benjamin Rosenblum, 32, was by 2017, from $17 billion. In 2013, ITN Networks: Stephen Poulin, 44, joined accounting, tax and promoted to partner at the law firm. He Collective reportedly earned $200 the video ad-sales company as executive advisory services firm was previously an associate. million in revenue. Pryor Cashman: vice president of platform development. as a partner in its not- Eric Fishman, 34, was “What Collective is trying to do He was previously executive vice presi- for-profit practice. He was previously promoted to partner at the law firm. He dent and managing director of opera- director at the Accounting and Adviso- was previously of counsel. is make it as easy as possible tions at MediaVest Worldwide. ry Office of Ethan Kahn, which he —nazish dholakia for the marketer to connect Omnigon: Phil Sharpe, 59, joined the founded. with consumers across as many digital consulting firm as senior vice DJK Residential: Fainna Kagan, 34, screens as possible,” said Chief president of client strategy and engage- joined the real estate brokerage as an EXECUTIVE PROMOTIONS Executive Joe Apprendi. “If we do ment. He was previously senior vice associate broker. She was previously a The fastest way to get an announcement into our jobs, we hope to be in the senior associate at Robbins Geller Rud- president of digital strategy and com- Crain’s is to submit online. Fill out the form middle of the $36 billion of petitiveness at Turner Broadcasting. man & Dowd. at www.crainsnewyork.com/section/ Hughes Hubbard & Reed: Elizabeth Pre- Herrick Feinstein: Jonathan Adler, 36, was executive_moves. The Executive Moves column activity.” witt, 44, joined the law firm as a partner promoted to partner. He was previously is also available online. —NAZISH DHOLAKIA

10 | Crain’s New York Business | January 26, 2015 The 2015 Sprinter Your dream fits in a Sprinter.

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1P_MB_Airport_Crains NY_11.125x14.875in_2015.indd 1 9/22/14 11:43 AM 20150126-NEWS--0012-NAT-CCI-CN_-- 1/23/2015 2:45 PM Page 1

OPINION CRAIN’S NEW YORK BUSINESS

No more business as usual Rance Crain editor in chief publisher, vp Jill R. Kaplan ssembly Speaker Sheldon Silver says he We have long argued that legislators must be denied EDITORIAL opportunities for venality because too many cannot resist its editor Glenn Coleman will be vindicated, and his defenders managing editor Jeremy Smerd question whether his secret windfall of $6 lures. Corruption obviously corrodes the public’s faith in deputy managing editors Valerie Block, Erik Ipsen million in salary and fees—deemed government. assistant managing editors Barbara Benson, “bribes and kickbacks” by prosecutors— Moreover, it makes New York a less desirable place to do Erik Engquist senior news producer Amanda Fung constitutes a crime. business. Although critics complain that companies find contributing editor Elaine Pofeldt This shows just how lost our legislators ways to get special favors, businesspeople in fact are often columnists Greg David, Steve Hindy, Alair Townsend senior reporters Theresa Agovino, are. Reality check: If the speaker’s schemes were ethical, let victims of a system that Aaron Elstein, Lisa Fickenscher, Matthew Flamm, alone legal, why did he hide them? Corruption lawmakers set up to Daniel Geiger, Adrianne Pasquarelli A reporters Joe Anuta, Chris Bragg, The speaker’s story—that he was pulling in more than a protect their positions and Andrew J. Hawkins, Irina Ivanova, corrodes the Jonathan LaMantia, Thornton McEnery half-million dollars a year from a part-time law practice that profit from them. news producer Emily Laermer had nothing to do with Assembly business—was never public faith and One charge against Mr. web reporter/producer Nazish Dholakia art director Steven Krupinski credible. Most full-time lawyers don’t make that kind of Silver is he induced deputy art director Carolyn McClain money. And Mr. Silver, who has held the demanding job of makes New York developers who came staff photographer Buck Ennis copy desk chief Steve Noveck Assembly speaker since 1994, wasn’t practicing even part- a less desirable before his office to hire a copy editor Thaddeus Rutkowski law firm that paid him data editor Suzanne Panara time. As U.S. Attorney Preet Bharara put it when he charged researchers Jessica Kramer, Nicholas Wells the speaker with corruption last week, Mr. Silver did no legal place to do $700,000 for the referrals. editorial intern Yoona Ha work at all. Another is that a doctor ADVERTISING business advertising director Joanna Harp The speaker could carry on his schemes for so long who got a six-figure state sales manager Irene Bar-Am because legislators subject themselves to no limits on outside grant from Mr. Silver senior account managers Jill Bottomley Kunkes, Courtney McCombs, income and minimal scrutiny.The legislature is a self- referred his lung-cancer Rob Pierce regulating body: It makes the laws that dictate what its patients to a personal- account managers Zita Doktor, Stuart Smilowitz sales coordinator LeAnn Richardson members can do and what the public can see of their actions. injury law firm that paid the speaker $5.3 million.These and credit manager Jason Hogan (313-446-0353) For years, Mr. Silver simply checked a box saying he earned numerous other examples over the years have created the CUSTOM CONTENT, EVENTS AND PRODUCTION impression, if not the reality, that businesses must grease director of custom content Trish Henry more than $250,000 beyond his $121,000 public salary. director of audience & content Only after subpoenas started flying did the authorities lawmakers’ palms to get service. partnership development Michael O’Connor director of conferences & events discover that he had made at least $6 million since 2000 and To send the message that New York is open for business, Courtney Williams spread the money over eight accounts at six different banks. we must make it clear that our legislators are not. events coordinator Adrienne Yee events coordinator & scheduler Alexis Sinclair reprint account executive Alicia Samuel COMMENTS media services manager Nicole Spell CRAIN’S ONLINE POLL ONLINE AND INTERACTIVE SERVICES general manager Rosemary Maggiore SHOULD TO SUBSCRIBE: For print and digital subscriptions or customer SHELDON Yes to Seaport plan service, e-mail [email protected] or call 877-824-9379 (in the U.S. and Canada) or SILVER Square and a father 313-446-0450 (all other locations). $3.00 a copy for LESSONS FROM SANDY the print edition; or $99.95 one year, $179.95 two STEP of two preschool years, for print subscriptions with digital access. I agree with the editorial on the children, I couldn’t www.crainsnewyork.com/subscribe DOWN AS South Street Seaport redevel- agree more with TO ADVERTISE: opment by Howard Hughes your thoughts on Contact Joanna Harp at [email protected] SPEAKER? Corp. It is a “classic New York the South Street or call 212-210-0278. www.crainsnewyork.com/advertise

bloomberg news City development story,” with Seaport. the typical coterie of politicians The area is in Yes. With Mr. Silver facing such serious FOR INFORMATION ON OUR EVENTS:

and NIMBYists, and the oft- architects shop much need of rede- charges, his effectiveness as Assembly Contact Courtney Williams at seen dance of public criticism velopment, and the [email protected] or 212-210-0257. speaker is over. For the good of the state and and private approval (“Seaport waterfront repairs and im- Hughes plan should not be www.crainsnewyork.com/events the legislative process, he should step aside plan’s new approach,” Jan. 12). provements, and in-street utili- thwarted. I have no idea what TO CONTACT THE NEWSROOM: until a jury can decide his fate. And you are right to point out ties), and there surely are other the City Council folks are 685 Third Ave., New York, NY 10017-4024 No. Mr. Silver stands accused of serious that many recent residents of opportunities for city partici- thinking. Adding close to $1 editorial phone: 212-210-0277 the neighborhood would like to pation in development financ- billion in investment with a fo- fax 212-210-0799 crimes, which he denies. Meanwhile, he Entire contents ©copyright 2015 Crain Communications Inc. remains innocent until proven guilty—end of see some of the public benefits ing. All I can see is that the de cus on the young families of All rights reserved. ®CityBusiness is a registered trademark story. sooner rather than later. I think Blasio administration does not lower Manhattan is exactly of MCP Inc., used under license agreement. Hughes has done a reasonably put its money where its mouth what the neighborhood needs. Date of poll: Jan. 22 CRAIN COMMUNICATIONS INC. BOARD OF DIRECTORS good job keeping the area acti- is, and some in the community Please do not give up on this 180 votes chairman Keith E. Crain vated in this transitional time are willing to fight to put an important redevelopment. The president Rance Crain after spaces were vacated due to expensive-to-build residential community needs sound busi- treasurer Mary Kay Crain lease terminations and Super- tower at the very edge of the ness rationale like this. Cindi Crain 85% storm Sandy, but I still think water—proving nothing was —edward riberio executive vp, operations William Morrow Yes they are duping you and us. learned from Superstorm Manhattan executive vp, director of strategic operations Chris Crain Yes, some relatively large Sandy. I hope sense will pre- executive vp, director of corporate commercial or residential com- vail, even if unnecessary delay VISITING LADY LIBERTY operations K.C. Crain ponent is necessary to write is the order of the day. senior vp, group publisher David Klein Something must have been in vp/production, manufacturing David Kamis 15% down costs of some portion of —john lynch the public benefits, but there is the water during the Source chief financial officer Thomas Stevens No Manhattan chief information officer Anthony DiPonio public money available for Lunch ( Jan. 12) that resulted some of them (the school, AS A RESIDENT OF 3 Hanover See COMMENTS on Page 14 founder G.D. Crain Jr. (1885-1973) chairman Mrs. G.D. Crain Jr. (1911-1996) secretary Merrilee Crain (1942-2012) FOR THIS WEEK’S QUESTIONS: CRAIN’S WELCOMES SUBMISSIONS to its opinion pages. Send letters to [email protected]. Send columns of 475 Go to www.crainsnewyork.com/poll to have your say. words or fewer to [email protected]. Please include the writer’s name, company, address and telephone number.

12 | Crain’s New York Business | January 26, 2015 20150126-NEWS--0013-NAT-CCI-CN_-- 1/23/2015 1:30 PM Page 1

forms passed years ago. It would provide cops hired after 2009 with Mayor should resist the same disability pension provi- sions as those hired earlier. Newer hires receive about 44% of their cop pension rollback salaries with an offset for Social Se- curity benefits, compared with 75% with no offset for Social Security. he dispute between the cops and the mayor is part- Mayor Bill De Blasio opposed this ly about an election—not the mayor’s, but that of sweetener last year because of the cost Patrick Lynch,head of the Patrolmen’s Benevolent and, I hope, because it doesn’t distin- guish between those actually injured Association,whom dissidents want to unseat. on the job and those with conditions Like some other elected officials, Mr. Lynch presumed to be job-related. These uses inflammatory rhetoric and actions to score points with his “presumptive” conditions are ripe for T abuse, since unscrupulous doctors base. He said City Hall had “blood on its hands” in the killing will certify them even if people are of two police officers,led a shameful two-week slowdown in the able to, and eventually do, hold other jobs. This misguided policy works enforcement of low-level violations against those with genuine service- and encouraged officers to turn their connected health issues. backs on the mayor at police funerals. Costs would be far higher still if There are, of course, real issues. firefighters also gain coverage. Be- Mr. Lynch and his members have cause two-thirds of firefighters retire been battling the mayor for a con- on disability, costs would soar. tract, and the matter is in arbitra- Albany wants a home-rule meas- tion. Police disability pensions have ure from the City Council,although also been brought into the conflict. state legislators have routinely liber- Pensions for law-enforcement of- alized pensions in the past, along ficers have typically been more gener- with the requirement that the city ous than for other public workers.We pick up the tab. The mayor cannot want our cops to be able to chase, ALAIR TOWNSEND veto the home-rule measure, but his tackle and subdue wrongdoers, so we position could sway the council. have allowed them to retire at earlier It may be difficult for the mayor ages with better benefits. bills” that presume that heart ail- to resist the pressure to accede, but Disability provisions for cops and ments, among others, are job- he should do so. At $8.6 billion, other uniformed employees such as related, regardless of obesity or per- pension costs are a huge part of the firefighters, sanitation workers and sonal choices such as smoking. city’s budget, and have grown 155% correction officers are more liberal, At issue is an attempt by the state since 2005—three times faster than too. They are all covered by “heart legislature to roll back pension re- the growth of the budget overall.

and grabbed the commission’s files to make sure what it had found How much did would not be buried. A few weeks later, at a Crain’s edi- torial board meeting, the governor governor know? blurted out his view that he was per- fectly right to disband the panel.“The Moreland Commission was my com- he question during the historic Watergate hearings mission,” Mr. Cuomo explained.“It’s in the 1970s was “What did he know, and when did my commission. My subpoena pow- er, my Moreland Commission. I can he know it?” When the answers became known, appoint it; I can disband it. I appoint President Richard Nixon had no choice but to resign. you;I can un-appoint you tomorrow.’’ The same question looms following last week’s That also did not sit well with the arrest of Assembly Speaker Sheldon Silver. “What did Gov. U.S. attorney—or lots of other peo- T ple, like New York Times reporters. Andrew Cuomo know, and when did he know it?” The cynical explanation has al- ways been that Mr. Cuomo saw the Here’s what we know from state- commission as a tool to force Mr. ments by U.S. Attorney Preet Silver into a budget deal on the gov- Bharara, investigative reporting ernor’s terms. (primarily by ), The charges allege that Mr. Sil- and the Silver charges. ver was increasingly desperate to de- Frustrated by his inability to win rail the Moreland Commission be- passage of legislative ethics reform, cause he knew his law-firm referral Mr. Cuomo convened the More- payments couldn’t stand scrutiny. land Commission to investigate The allegation is based in part on corruption in Albany, including statements by the governor’s staff. among legislators. Since the legality The bottom line is that the com- of doing so was suspect, he appoint- mission had developed information ed district attorneys who would that helped lead to the arrest on cor- have power to investigate legisla- GREG DAVID ruption charges of the second- tors, as well as key staff members he most-powerful official in the state. expected to control the inquiry. Thus the question:What did the But the Moreland Commis- charges against Mr. Silver. governor know, and when did he sion—whether the staff or mem- After months of behind-the- know it? bers, we don’t know—acted much scenes struggle over the investiga- Maybe it wasn’t illegal for the more independently than expected. tions, Mr. Cuomo suddenly dis- governor to abolish the Moreland One flash point was its decision to solved the commission as part of last Commission, even if he knew it had look into New York City real estate year’s budget deal in return for ethics developed damaging information interests.In retrospect,that was cru- reforms that even the governor ad- about Mr. Silver. However, Mr. cial, given developer Leonard mitted were inadequate. The U.S. Cuomo’s reputation and future in Litwin’s prominent role in the attorney was angered by the move politics might never recover.

January 26, 2015 | Crain’s New York Business | 13 20150126-NEWS--0014-NAT-CCI-CN_-- 1/23/2015 1:31 PM Page 1

OPINION

KIZZY CHARLES-GUZMAN environment, but it also is a win for businesses. Although many estab- Bag fee a cheap way lishments, such as restaurants, will be exempt, those covered by the bill have a lot to gain. Instead of having to save the planet ... to give out disposable bags that they’ve purchased, businesses will charge per bag and keep every dime. It’s that simple. The bag bill could ew Yorkers use too many single-use disposable increase many businesses’ profit bags—a staggering 10 billion of them annually, margin. according to the city’s Department of Sanitation. The gain for retailers is clear, but As a leader in forward-thinking environmental- what about customers? The dime-per-bag fee is not a re- policy changes, the city should take a proactive gressive tax on the city’s residents,as approach to dealing with pollution, not to mention millions of some opponents have stated. The N charge will make New Yorkers think buck ennis wasted tax dollars, by backing a bill to impose a 10-cent fee on twice at the checkout counter, and fee.The bill also requires New York ing a more sustainable and resilient plastic and paper bags provided by most retailers. avoiding the fee is simple: Bring to initiate citywide reusable-bag planet, one shopping trip at a time. your own reusable bags, and don’t giveaways, including educational Similar initiatives have worked From an environmental stand- duction, transportation and disposal take a bag when you don’t need one. outreach events, targeting house- in more than 100 places around the point,disposable bags litter our com- contribute to climate change. People will be more aware of their holds and stores in low-income world,leading to a 90% reduction in munities and our storm drains, For New York City to achieve an opportunities to save the planet— neighborhoods. plastic-bag use in Los Angeles and exacerbating local flooding. Eventu- 80% reduction in greenhouse-gas not to mention to cut back on the As consumers,we essentially cast a 60% cut in Washington, D.C. ally, they end up in our waterways, emissions by 2050, as promised by millions of dollars the city spends to a vote every time we hit the check- There is no reason New York should where they can harm local wildlife, Mayor Bill de Blasio and the City transport bag waste to landfills. out line. Bringing a reusable bag to lag behind. It’s time for action. especially marine life, and prevent Council, measures like the bag fee The proposal considers vulnera- the store is how we can be responsi- New Yorkers from enjoying clean are critical. ble New Yorkers. Shoppers using ble residents. It’s an easy way to Kizzy Charles-Guzman is policy director beaches. Finally, plastic bags are de- What’s more, this legislation not food stamps or buying medicine at speak up for the health of our city, for the Nature Conservancy’s NYC rived from petroleum, and their pro- only benefits communities and the pharmacies will be exempt from the and it shows our support for creat- Program. MARK DANIELS

dustry. It’s disappointing that the Recycled plastic can be turned ful impact on litter or the quantity of ... but council needs council is considering a bag tax,par- into many things beyond just new waste. ticularly in a place where bags are so bags. Following Hurricane Sandy, No one should lose a job, salary convenient and necessary, and decking materials containing recy- and benefits because of misin- to give rule the sack where recycling education—versus cled plastic bags were used to rebuild formed policymaking. It’s easy for burdensome taxes—could go a long boardwalks. uninformed politicians to portray way and has yet to be implemented The premise of this legislation is the plastic-bag industry as one significantly. based on bad science. Plastic bags made up of faceless corporations, ew York is first and foremost a business city.Occa- Plastic retail bags are made from are not the environmental problem but for Americans in it who earn a sionally, however, ill-conceived legislation comes natural gas, are 100% recyclable and that bag-tax proponents claim. decent living with good benefits, along that threatens to sabotage the city’s pro- highly reused. Our industry has de- American-made plastic bags are ac- this debate is deeply personal and business reputation. When the same legislation is veloped retail take-back programs tually the most environmentally frightening. so customers can easily recycle not friendly choice at checkout. They That’s why I encourage the City also inarguably anti-consumer—especially for the just plastic bags, but also newspa- consume fewer natural resources, Council to discuss meaningful recy- working poor—red flags need to go up everywhere. Such is the pers, dry-cleaning, bread and cereal generate fewer greenhouse-gas cling education. Let’s not let blind N bags, as well as overwraps on bottle emissions and take up less landfill passion obscure the facts: This leg- case with the City Council’s proposed grocery-bag tax. cases, paper towels and bath tissue. space than paper or reusable bags. islation does not help the environ- Taxing grocery bags won’t solve any environmental problems This system is efficient and separate In fact, the city’s own Depart- ment. It will turn shoppers toward from municipal recycling. ment of Environmental Protection worse carry-out options and has the but will turn people toward inferior Progressive Bag Alliance, I have a As part of the program,the indus- has stated that personal-hygiene potential to economically devastate options, costing consumers money mission to help educate American try has established more than 30,000 wipes are the real culprits clogging thousands of families. and jeopardizing American manu- consumers and policymakers about retailer drop-off points to make plas- our sewer system, and that the large facturing jobs—including right recyclable plastic bags, and to pro- tic-bag recycling easy. Stores like garbage bags you see on every curb Mark Daniels is chairman of the American here in New York City. tect the more than 30,000 people in Food Emporium,Target and Lowe’s are what’s filling up landfills.Taxing Progressive Bag Alliance, an industry As chairman of the American this predominantly American in- participate in the program. plastic bags will not have a meaning- group.

COMMENTS

velopable sites, more power to him. ed that already underground, under It will take several decades and —lance michaels the garden, exists a mechanical easily up to $20 billion or more (if Ferry wait times Syosset, N.Y. equipment room. you include an express track) for In 1977, the Frick Collection it- completion of the next three seg- Continued from Page 12 from going elsewhere. FRICK PLAN SHOULD self issued a press release announc- ments of the project north to 125th in the misstatement about extraor- —mike burke GO DOWN, LITERALLY ing a small pavilion and a “perma- Street and south to the financial dinary lines to board our ferries to Chief operating officer nent” garden. To invalidate this district. It’s been only 85 years since the Statue of Liberty and Ellis Is- Statue Cruises I am opposed to the destruction of designation would be a mockery of the project was announced with an land from Battery Park. the “permanent designated” garden New York City laws. anticipated cost of $86 million. In In fact, as reported previously BLAND CAN BE GRAND in front of the Frick Collection —beverly moss spatt 1939, the estimated cost was $249 by CrainsNewYork.com, wait (Editorial, “Expand the Frick mu- Brooklyn million, and in 1950 the full- times have been reduced “from two I am sure Gene Kaufman is crying seum,” Jan. 5). As a former chair of financing bonds were issued for it hours to 20 minutes on a busy day” all the way to the bank (“Baron of the Landmarks Preservation Com- PROMISES, PROMISES with an estimated cost of $504 mil- thanks to streamlined security bland buildings soars to the top— mission and former member of the lion. In 1955, the El measures spearheaded by the on a shoestring,” Jan. 12). While he City Planning Commission, I be- “Second Avenue subway’s first phase was demolished with promises of a National Park Service and the may not be providing what some lieve such action would set a terri- is 76% done” (CrainsNewYork.com) Second Avenue subway to replace it NYPD. The more visitors, the bet- critics believe are artful buildings, ble precedent for designated land- describes very modest progress. “soon.” And the proposed subway ter: They contribute to our city’s he is providing a product needed marks. As to the need for Consider that the first of four seg- has since been reduced from six economic health. by the city: Some people just need expansion, it could be complied ments, consisting of three stations tracks to two. We don’t need homegrown fab- a less expensive place to sleep. If he with underground, as is done with between 96th and 63rd streets, cost —larry penner rications keeping those dollars is able to develop otherwise unde- other institutions. It should be not- $4.5 billion, or $2 billion per mile. Great Neck, N.Y.

14 | Crain’s New York Business | January 26, 2015 20150126-NEWS--0015-NAT-CCI-CN_-- 1/22/2015 5:22 PM Page 1

TOURISM INSIDE The List New York City’s largest hotels PAGE 17 ‘The Bronx has 400 hotel rooms, and there’s a tremendous need for more’ REPORT —Gifford Miller, co-managing member, Signature Urban Properties, P. 16 Rooms to grow for borough hotels Occupancy rates are keeping up with room boom beyond Manhattan

BY CARA S. TRAGER

Taking a page from the film Field of Dreams, developers have been lining the city’s outer boroughs with a growing number of inde- pendent and brand-name hotels, convinced that if they build them, guests will come. So far, they have: Outer- borough occupancy rates between January and November 2014 ran as high as 81%,according to STR, a hospitality- industry re- search firm. NUMBER100 OF Most hotel HOTELS slated to markets oper- open in the outer ate at 65% oc- boroughs over the cupancy,while next 36 months, Manhattan is as tourism grows “pushing” 83%, said Sean Hennessey, chief executive of Lodging Advisors, a Manhattan-headquartered con- GOT OPULENCE? sulting firm. Scott C. Rohm (left) “We’re in a huge tourism and Andrew Turner aim to take luxury to a boom, and that echoes across the new level at the first- boroughs,” said Rob MacKay, ever Baccarat Hotel. director of the Queens Tourism Council, which is a part of the Queens Economic Development buck ennis Corp. With a record number of tourists visiting the city—and an estimated 22.5 million hotel guests among the nearly 56 mil- lion visitors to the city last year, according to NYC & Compa- Big spenders welcome ny—hoteliers have turned to the outer boroughs to snag out-of- Regency and the Palace New York FILLING UP standard in luxury, is doubling down. towners who can’t score a reserva- $1K for one night? have invested millions on major ren- New York will become the third U.S. tion in Manhattan’s tight hotel No problem: City’s ovations in the past couple of years, The occupancy rate at the city, joining Los Angeles and Chica- market or think it is too pricey. and new ultra-posh properties are city’s five-star hotels has go, to feature two Four Seasons prop- Over the next 36 months, super-luxury hotel sprouting up. In August, the five-star been climbing. erties in 2016,when a downtown ven- more than 100 hotels are slated Park debuted on West 57th 75% ue is expected to open. The midtown to open across Brooklyn, market is thriving Street, and in March - Four Seasons hotel has been open Queens, Staten Island and the ital Group is opening the first-ever 72% since 1993, and it, too, is gussying up. Bronx. Still, the future of outer- BY LISA FICKENSCHER Baccarat Hotel, on West , It renovated its spa and fitness center borough lodging is anything but in a licensing deal with the venerable during the summer and added its first certain. The Big Apple is flush with hotels for French crystal company. aboveground event space, Fifty7, “The unanswered question is guests who don’t flinch at nightly It had been a decade since the last which can accommodate 200 people. how deep is the market for people room rates of $1,000 or more. five-star hotel was developed in the 64% “Now we can host more weddings, who dream of coming to New The city’s super-luxury hotel stock city—the Mandarin Oriental at 60% increase our catering business and York and couldn’t because there is at an all-time peak, say industry ex- . 2009 2013 book charity events that we couldn’t weren’t enough rooms available perts.Older properties like the Loews Even the Four Seasons, the gold Source: PKF Consulting See SUPER-LUXURY on Page 16 See ROOMS on Page 16

January 26, 2015 | Crain’s New York Business | 15 20150126-NEWS--0016-NAT-CCI-CN_-- 1/22/2015 5:23 PM Page 1

REPORT TOURISM Super-luxury properties

Continued from Page 15 at play. Experts say the hot residen- hotel amenities, including a spa, do in the past,”said a spokeswoman. tial market is spurring the develop- housekeeping services,in-room din- The hotel has hosted wedding ment of luxury hotels. ing and a swimming pool on the receptions, but mostly in spaces that The new ones all have apart- 25th floor that pipes in music under- lacked windows. ments costing tens of millions of water. designed the After suffering an image prob- dollars on their top floors. Think playlist for the sound system. lem following the economic down- room service with a view. turn in 2008, luxury hotels are back “The hotels are really podiums to Six stars in vogue. Occupancy rates at the push the residential units higher so Even the Park Hyatt’s least ex- city’s top nine five-star hotels rose to pensive rooms—which go for $563 72% in 2013 from 64% in 2009 and for the first weekend in February and were expected to finish 2014 at that ‘It’s a sign that increase to $888 for the first week-

higher figure, according to Mark end in May—offer outsize perks. & residences new hotel york baccarat VanStekelenburg, senior vice presi- the market is “At 530 square feet, we have the dent at PKF Consulting, a hospital- largest entry-level guest rooms in What comes with a $799-per-night ity research firm. Average room becoming the city,” said Ernie Arias, director rates over the same five-year period of sales and marketing, adding that room at the Baccarat? at those properties rose to $800 from healthier’ most city properties of the Park  King-size bed $710 and were expected to finish Hyatt’s caliber limit the least expen-  Cashmere throws 2014 at $840. sive rooms to about 400 square feet.  Complimentary still and sparkling water Not to be outdone,the Baccarat’s  Insatiable demand residential marketing efforts refer to Bath products by Parisian perfumer Francis Kurkdjian “It’s a sign that the market is be- they have better views,” said Sean the hotel as a six-star property—one  Baccarat crystal stemware for the minibar coming healthier,” Mr. VanSteke- Hennessey,chief executive of Lodg- star greater than the industry stand-  Marble-topped nightstands lenburg said, adding that the jump ing Advisors as well as an assistant ard for the most elite hotel—to  24-hour concierge and in-room dining last year shows indications of an ac- professor at ’s sweeten the deal for buyers consid- Note: Room rate is for March 27, 2015 celerated recovery. Tisch Center for Hospitality and ering one of the 60 apartments, Fueling this activity is a seeming- Tourism.“These super-luxury prop- which start at $3 million and run to ly insatiable demand to experience erties are designed to enhance the $60 million for the penthouse. hotel rooms. A spot check of Baccarat’s rates the city, as visitors flock here in residential components,” he added. Starwood Capital Group is spar- “We expect to lead the market in shows that they closely parallel record numbers year after year. But The Park Hyatt has 94 residential ing no expense to enhance the 114- product and service, and our rates those of the Mandarin Oriental, at the high end, it’s not just tourism units in the condominium room property, including an invest- will reflect that,” said Scott Rohm, Park Hyatt and Four Seasons,which tower, a 75-story spire where apart- ment in 15,000 —costing president of SH Group, the hotel are charging just under a grand for a LISTEN to a discussion at ments have sold for $9 million to $90 between $90 and $160 apiece— brand-management firm for Star- standard room in April and May, CrainsNewYork.com/podcasts million. Residents have access to all from Baccarat to stock its bar and wood Capital. when bookings start to heat up. Ⅲ

The New York Marriott at the Mr. Hennessey.Manhattan has 380 Rooms to grow in outer boroughs Brooklyn Bridge, which opened its hotels and 87,755 rooms, and about doors on Adams Street in 1998, is 80 more properties totaling more credited with triggering the still- than 16,400 rooms are in the Continued from Page 15 for hotel projects are downtown said Mr. MacKay. ongoing development of new hotels pipeline, STR reports. or in their price points,” said Mr. Flushing and the area surrounding Meanwhile, Brooklyn, with its in areas beyond Manhattan. Less than three years old, the Hennessey. LaGuardia Airport, said Mr. hipster vibe and attractions such as The Bronx has been starved for Wyndham Garden Long Island Moreover, the expansion of the MacKay. While Long Island City Barclays Center and the Brooklyn hotels, but developers are in various City Manhattan city’s hotel sector beyond Manhat- attracts hoteliers with its easy sub- Academy of Music, welcomed two stages of planning and building five, View is already tan could be threatened by a City way access to Manhattan, growing new hotels last year, bringing its to- including the Residence Inn the experiencing in- NUMBER23 OF Council push for changes that restaurant scene, cultural institu- tal to 50, with 4,272 rooms, and Bronx at Metro Center,a 125-room HOTELS creased price would end hotels’ right to open in tions, hot residential market and room occupancy to 81.1%. property to open in mid-April, and projected to open competition industrial and manufacturing zones visitor traffic—particularly Euro- According to STR, Brooklyn will the 130-room La Quinta Inn & in Long Island City from lower without council approval. Council peans—Flushing’s lure is a flow of have a projected total of 70 hotels— Suites Port Morris, to debut in late over the next four Manhattan. years, out of 50 leaders argue that industrial and wealthy travelers from . including the 196-room Hilton New 2016. overall in Queens “We are be- manufacturing jobs in Brooklyn and “They’re coming for a whole York Brooklyn Downtown now un- “The Bronx has 400 hotel ginning to com- Queens, which represent the bunch of reasons—to visit, to drop der construction—by the end of rooms, and we think there’s a pete with the strongest outer-borough markets off their kids at college, to buy an 2017, a 150% increase from the 28 tremendous need for more,” said 150% downtown for lodgings, pay workers nearly apartment or establish an office,” properties the borough had in 2008. Gifford Miller, a former City INCREASE in [Manhattan] twice what the hotel, Council speaker and now co- Brooklyn hotels market because expected by the retail and restaurant GROUNDBREAKING managing member of Manhattan- end of 2017, from that’s overbuilt,” industries do. for a 152-room headquartered Signature Urban 28 properties in said Jeffrey Hampton Inn is Properties,which will break ground 2008 Reich-Hale, di- Queens heating up scheduled for June in in June on a $35 million, 152-room rector of sales and With 101 hotels, the hotel-starved Bronx. Hampton Inn in the South Bronx. marketing, “and 10,694 rooms and an 10 The project is slated to open in the HOTELS ON we’re adjusting to average occupancy first quarter of 2017. STATEN ISLAND, that by some- rate in 2014 of 80.9% Besides the property’s short or one for every times lowering through November, walking distance to three subway 38 in Manhattan our group rates, Queens is on pace to lines, and the borough’s attractions, when necessary.” add nearly 50 prop- including Yankee Stadium and the The hotel fervor has been least erties in the next four Bronx Zoo, Mr. Miller believes its apparent in the most suburban and years, according to prices will be a major drawing card. isolated borough, Staten Island, STR. About 23 will “We’ll get the Manhattan busi- with its 10 hotels, 822 rooms and be in Long Island ness because we’ll be very competi- nearly 70% occupancy rate in 2014. City, including a tively priced and less than compara- But later this year, two develop- 176-room Aloft Ho- ble properties in Manhattan,” he ments are due to open, and their ar- tel scheduled to open said. rival could be fortuitous, with the in September, and a anticipated influx of up to 6 million 120-room Towne- The Manhattan effect more annual visitors to the borough, Place Suites Hotel, a But with hotel development pro- thanks to Empire Outlets, a Marriott property ceeding virtually nonstop in Man- 340,000-square-foot retail project with a mid-2016 hattan, increased hotel availability slated to open in 2016, and the New opening. and reduced rates there could fol- York Wheel, a towering 60-story The borough’s low—which would mean “fewer Ferris wheel scheduled for comple-

other robust markets architects dattner guests in the surrounding area,” said tion in 2017. Ⅲ

16 | Crain’s New York Business | January 26, 2015 20150126-NEWS--0017,0018-NAT-CCI-CN_-- 1/22/20155:23PMPage1 LIST N THE THE SCOOP hog oebr accordingtoSTR. through November, to$8.2billion atarea wasup8.4%from 2013, Revenue properties Queens. IslandCity, Long New properties include the210-room include New properties in2013. morethesameperiod 2million thanduring nearly through November rooms 31.6million were lastyear, from rented January inthecity Overall, Baccarat Hotel NYC &Company ects. cording toSTR. ADRincreased 4.5%forthesameperiod. Freitag saidthatnationally, Mr. to$260. 2%, rate(ADR) forhotelrooms wasuponly averagedaily 84.9% through November.Surprisingly,the at Freitag flat, ratewasrelatively notedthatthecity’s averageoccupancy Mr. mand byabout6%.” motion thatgivesguestsBroadway show towork with passesandaride Funday theHyatthasintroduced features asaSunday such pro- To thatend, hesaid. place,” market- dynamic aboutbeingagileinavery “It’sall quickly. tosuccessisevolving said thekey with 13,000additionalrooms under currently tocompete are andincrease rates cutrates here services will tostayorwhetherthey occupancy Pardue said. Mr. in2014, occupancy average “north of91%” hoteldidnotprovide forCrain’s rates average group andconventiontravel.The inover theweekend. check                 “That’s a lot of rooms,”said alotofrooms,”said “That’s New York added nearly 6,000 hotel rooms last year for a total of 112,947,according toSTR. New York 6,000hotelrooms lastyearforatotalof112,947,according addednearly In the changing industry,hoteliers are working to develop new strategiestocapturebusiness. are new working todevelop In thechangingindustry,hoteliers ratherthanexpansionproj- robust growth construction stemmedfromThe industry’s new ac- to$8.2billionthrough November, atarea wasup8.4%from 2013, Revenue properties The question going forward,STR’s Mr.Freitag said,is whether hoteliers will trust thathigh trust whetherhotelierswill said,is Mr.Freitag The questiongoingforward,STR’s withthebalancemadeupof The Hyatt’sand40%leisure, guestsare about30%corporate Mark Pardue Ta ste$ ilo usin”M.Freitag said. Mr. question,” isthe$8billion “That Crain’s !.?)7:3!)   6-%< #01'+#4,/(/ +"#+1/ ) !.?)7:3!)  (<1%< ,1#)"'0,+ !.?)7:3!)   :7*-?*A  +& 11 + /,4+#) 7 '*#0.2 /# !.?)7:3!)   ( :-%< #01'+#4,/( 1'*#0.2 /# !.?)7:3!)  (<1%< 2"0,+ !.?)7:3!)  *-2;76>. #4,/( ) !# !.?)7:3!)  <1%< ,,0#3#)1,1#) !.?)7:3!)  201<1>. 6+"& *#4,/(#/,1#) !.?)7:3!) #*:3>.  )",/$01,/' #4,/( !.?)7:3!)   6-%< / +"6 11#4,/( !.?)7:3!)   201<1>. ,4 !.?)7:3!)  %.>.6<1>. #4,/(0,1#)#++06)3 +' !.?)7:3!)   %.>.6<1>. &#/ 1,+#4,/('*#0.2 /# !.?)7:3!)   :7*-?*A #4,/( //',11 /.2'0 !.?)7:3!)  %2@<1>. #4,/(')1,+'"1,4+ list of the 25 largest hotels showed only two of those properties addedrooms in2014. list ofthe25largesthotelsshowedtwothoseproperties only 2014 for the fifth straight year,according todatafrom straightyear,according 2014 forthefifth ratein thehoteloccupancy andbusinesstravellifted Recordtourism to fillthem. oftravelers noshortage fornow, ew York hasmore and, hotelrooms City thanever firm. But some observers question whether the growth can keepgoingforever. questionwhetherthegrowth can Butsomeobservers firm. , scheduled to open in February (seePage toopeninFebruary scheduled 15). , andSTRdatashow more room nightswere before. soldatarea hotelsthanever , , general manageratthe general , h iywsepce ohs oe5. ilo iiosi 04 accordingto visitorsin2014, wasexpectedtohostsome55.8 million The city Jan Freitag Ranked by numberofrooms New York City’s Hotels Largest Park HyattHotel ,senior vice president at STR,“because we only grewde- weonly vicepresident atSTR,“because ,senior Grand HyattNewYork ?.;<266.?A7:30:*6-,.6<:*4,75 construction, including theswanky114-room including construction, 5*61*<<*6,:7?6.84*B*,75 6.?A7:3124<7652-<7?6,75 0:*6-6.?A7:31A*<<,75 6A5*::27<<5*:9=2;,75 <1.:77;.>.4<17<.4,75 ;1.:*<766.?A7:3,75 and the123-room ?*4-7:/6.?A7:3,75 .-2;7617<.46A,,75 6.?A7:38*4*,.,75 ' )/$$&"$$* ,)""''&"-&+' '&&"**&,% 1=-;7617<.4,75  !                                               N.6on (No. 17<.48.66,75 ,)&*")& "!) '++) '$$&&+)* ?.;<266A,75    )#), &&+)*'& '++, &"'+) -"!* 6A17<.4,75 :7?6A,,75 )!"$* ))/."* &)&/ STR ,a hotel-industry research hotel-industry ,a & Crain’s Uber —nicholas wells Paper Factory Hotel Paper Factory !! car service ifthey service car list) inmidtown, it buthadan list,               

           

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-o oebr -hog oebr -siae Source:STR 1-For November. 2-ThroughNovember. 3-Estimate. Average employment in the hotel industry inNYCAverage employment inthehotelindustry ACCOMMODATING JOBS 1-Through November. TRENDS ROOM TOGROW 30 40 50 2009 93.7 2005 Active inventory (inthousands) Active inventory vrg oe cuac hoteloccupancy Average Average employment(thousands) Average                                             2010 !  98.2            6 -  &!)24<76- + *!.?    6 - 6 -  6 - A*<<7<.4;$.;7:<;   6 - 101.1

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istockphoto 20150126-NEWS--0017,0018-NAT-CCI-CN_-- 1/22/2015 5:23 PM Page 2

THE LIST New York City’s Largest Hotels

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18 | Crain’s New York Business | January 26, 2015 20150126-NEWS--0019-NAT-CCI-CN_-- 1/23/2015 2:10 PM Page 1

REAL ESTATE

B Cup Cafe hopes PERSON OF INTEREST Perfume maker’s to fill new spot Residents of the far West Side will OPTING FOR OBSCURITY soon have a new breakfast option. The owners of the East Village’s B AS A COMMERCIAL REAL ESTATE BROKER, move makes scents Cup Cafe will open a location at JIM COLEMAN handled some of the biggest 500B W. 42nd St., between 10th and and most lucrative deals in the city last he U.S.arm of French fragrance company Mane Inc.needs more 11th avenues. The tenant has inked year, but he is not surprised that most space for its chemists to sniff out new fragrances. a 10-year lease for the 800-square- people in the industry still fail to recognize The company has renewed its lease at 555 Madison Ave.,be- foot ground-floor space, where the his name. tween East 55th and East 56th streets, for more than 10 years asking rent was $120 per square foot. Mr. Coleman, 52, left a high-visibility and signed on for an additional 5,800 square feet,bringing its to- The eatery will open its doors at post at a major brokerage more than 15 Ttal footprint at the property to 17,400 square feet. a time when the neighborhood has years ago and has since eschewed the Mane will now occupy floors 28, 30 and 31. Pri- a number of major construction limelight, a philosophy that he believes has or to the deal,the company’s office was located on projects underway, led by the Hud- contributed mightily to his success. Even floors 28 and 30. The asking rent in the deal was son Yards mega-development. The his firm has an anodyne-sounding handle, about $80 per square foot. prospect of a major step up in the Hanley Advisors, derived from Mr. Mane needed more lab space at the 32-story, number of people living and work- Coleman’s middle name. 450,000-square-foot building, and the expand- ing in the once-quiet area has had a “I felt being a little discreet was the lori leiberman ed laboratory will become the centerpiece of the big impact on retail rents. right thing for someone in my role,” Mr. Coleman said. “Having a firm office. As part of the transaction, Mane is more “[Rents] are steadily rising as the named after me in bold letters and being the broker who gets out in front than tripling the size of its lab, to 4,000 square area continues to develop,” said when a deal is done just didn’t feel right.” feet from about 1,200. Margaret Royer, the Square Foot But Mr. Coleman’s anonymity is falling victim to his success. In late 2013, “The way they’re configuring the space,when Realty broker who represented the he arranged a deal for billionaire George Soros’ investment fund to lease a guests arrive on their floor, they will immediate- tenants. 100,000-square-foot office atop Boston Properties’ new spire at 250 W. ly see the lab behind a glass wall,”said Peter New- Building on the success of B Cup 55th St., along with several others in the 1 million-square-foot property. man, a broker at real estate firm Handler, who, on East 13th Street, the owners set “Most tenants have probably never heard of him,” said Andrew Levin, an with colleague Darell Handler, represented their sights on channeling the new executive at Boston Properties who helps oversee leasing of the firm’s Mane in the deal. “They’re setting it up as a showpiece because it creates energy of the West Side. Manhattan office portfolio and has negotiated several of its deals with Mr. quite an impression, and it’s something they’re very proud of.” “We see the far West Side of Coleman. “But landlords know he’s a great guy to do deals with.” Robert Baraf,Mark Mandell and Ethan Silverstein,brokers at Cushman Manhattan as up and coming, Mr. Coleman’s profile rose even higher last summer, when he arranged the & Wakefield,represented the landlord,the Coates family,in the transaction. backed by innumerable construc- —daniel geiger tion projects,” said Jordan Hadani, eye-popping $700 million sale of the St. Regis Hotel’s retail space on Fifth who co-owns the café with Guy Avenue for Swiss luxury-goods company Richemont to a partnership Weizmann.The tenants expect they between Vornado and Acquisitions. Insurance broker “The [new] building is ideal for a will serve residents of the new high- Mr. Coleman began his career in the real estate business in the mid- parks in Brooklyn growing business,” said GoodScout rise apartments in the area,as well as 1980s, ultimately landing at Cushman & Wakefield in the late 1990s, founder Tom Pegues, who is plan- the large flow of tourists. where he became one of its top earners. Rather than sticking with a feast-or- An online health insurance broker is ning to quadruple his four-person Brokers Howard Aaron and famine system of earning big commissions on deals, however, he decided to the latest company to take space at workforce in the coming months. Teodora Koleva,also of Square Foot opt for a fee-oriented pay structure that incentivized good advice and strategy. 1000 Dean St., the former Studebak- “It’s a space that was large enough, Realty, represented the landlord, “I pride myself most on being a trusted adviser to clients,” Mr. er factory turned creative office but also affordable,and allowed us to Clinton Housing Development Co. Coleman said. “A broker should never push a client into a transaction.” space in Crown Heights that be in the mix among a bunch of oth- —grace conroy —DANIEL GEIGER doubles as the winter home of er tech startups and nonprofits.” Brooklyn Flea. GoodScout hosts an online mar- ketplace for health insurance plans. It also donates 15% of its profits to support health care nonprofits, in- cluding Samahope,a San Francisco- based crowdfunding organization SUBLEASE AVAILABLE that funnels donations to doctors working in Africa. As a tech-focused business, GoodScout represents a departure from the creative firms, such as film 304 HUDSON STREET and architecture companies, that GoodScout signed a five-year populate the building. “We like 5,543 RSF OF BUILT TECH SPACE lease for 3,200 square feet on the sec- that,” said Aptsandlofts.com broker ond floor of the building, where the Christopher Havens. “It adds to the OPEN LAYOUT - CORNER UNIT asking rent was $26 per square foot. diversity of the building.” Since its birth in July, the firm has Mr. Havens represented the been in an aggressive expansion landlord, a joint venture among ʁ IMMEDIATE AVAILABILITY mode. Brownstoner Media, BFC Partners Its new home, which it will move and Goldman Sachs’ Urban Invest- ʁ FURNITURE AND IT CONFIGURATION into next month, is more than dou- ment Group. Mr. Pegues represent- MAY BE AVAILABLE ble the size of its current office at 205 ed himself in the transaction. ʁ INCLUDES PANTRY AND W. 54th St. in Manhattan. —joe anuta CONFERENCE ROOM ʁ TERM UNTIL FEBRUARY 27, 2019 BARE BONES 85 BROAD ST. FOR MORE INFORMATION: ASKING RENT; TERM: High $40s to mid- MITCHELL J. BARNETT RICHARD A. SERKO WILLIAM (BILL) LEE III $50s; 15 years VICE CHAIRMAN SENIOR DIRECTOR ASSOCIATE DIRECTOR SQUARE FEET: 38,400 (212) 841-7820 (212) 841-5047 (212) 841-7748 TENANT; REPS: Year Up; Mark Jaccom and Ed Wartels of Cresa Partners [email protected] [email protected] [email protected] LANDLORD; REPS: MetLife Inc. and Beacon Capital Partners; Peter Riguardi and Cynthia Wasserberger of JLL A full commission computed and earned in accordance with the rates and conditions of BACK STORY: The Boston-based nonprofit, our agency agreement with our principal, when received from our principal, will be paid to which helps low-income adults develop a cooperating broker who consummates a sublease which is unconditionally executed and professional careers, will consolidate staff delivered by and between sublandlord and subtenant. (A copy of the rates and conditions from its three New York City offices in its move referred to above are available upon request.) to Goldman Sachs’ former headquarters, according to .

January 26, 2015 | Crain’s New York Business | 19 P020-21CL_CN_20150126.qxp 1/23/2015 8:41 AM Page 20

TO PLACE A CLASSIFIED AD, CALL 1-800-444-6007 OR EMAIL [email protected] PUBLIC & LEGAL NOTICES Notice of Qualification of HAVAS Notice of Qualification of BGP NOTICE OF FORMATION OF Dave Notice of Qual. of Two Sigma Open Qualification of Blackstone Real Estate PEOPLE, LLC. Appl. for Auth. filed Tuscany HoldCo LLC. Authority filed Friedman 1, LLC. Articles of Source, LLC, Auth. filed Sec'y of Associates VIII L.P. Authority filed with Secy. of State of NY (SSNY) on with NY Dept. of State on 12/10/14. Organization filed with the Secretary State (SSNY) 4/15/14. Office loc.: NY with the Sect of State of NY (SSNY) 11/19/14. Office location: NY County. Office location: NY County. Princ. of State of NY (SSNY) on 10/24/2012. County. LLC org. in DE 4/14/14. SSNY on 10/28/14. Office Loc: NY County. LLC formed in Delaware (DE) on bus. addr.: 510 Madison Ave., 8th Fl., Office location: NEW YORK County. desig. as agent of LLC upon whom LP formed in DE on 10/22/14. SSNY 11/14/83. Princ. office of LLC: 200 NY, NY 10022. LLC formed in DE on SSNY has been designated as agent process against it may be served. has been designated as agent of LP Hudson St., NY, NY 10013. SSNY 12/2/14. NY Sec. of State designated upon whom process against it may SSNY shall mail copy of proc. to Att: upon whom process against it may designated as agent of LLC upon agent of LLC upon whom process be served. The Post Office address Matthew Siano, Esq., 100 Ave of the be served and shall mail process to: whom process against it may be against it may be served and shall to which the SSNY shall mail a copy Americas, NY, NY 10013. DE off. addr.: c/o The Blackstone Group L.P., 345 served. SSNY shall mail process to mail process to: c/o Willkie Farr & of any process against the LLC CSC, 2711 Centerville Rd., Wilmington, , NY, NY 10154. DE the LLC at the princ. office of the LLC. Gallagher LLP, 787 7th Ave., NY, NY served upon him/her is: c/o Max DE 19808. Cert. of Form. on file: address of LP: 200 Bellevue Pkwy, Ste DE addr. of LLC: 2711 Centerville 10019. DE addr. of LLC: c/o The Markus Katz, P.C., 88 University SSDE, Townsend Bldg., Dover, DE 210, Wilmington, 19809. Name/addr Rd., Ste. 400, Wilmington, DE 19808. Corporation Trust Co., 1209 Orange Place, New York, NY 10003. The 19901. Purp.: any lawful activities. of genl ptr avail from SSNY. Cert of Cert. of Form. filed with DE Secy. of St., Wilmington, DE 19801. Cert. of principal business address of the LLC LP filed with DE Sect of State, 401 State, Townsend Bldg.,Ste. 3, 401 Form. filed with DE Sec. of State, is: c/o Max Markus Katz, P.C., 88 Notice of Formation of KASURA Federal St, Ste 4, Dover, DE 19901. Federal St., Dover, DE 19901. Purpose: Townsend Bldg., Dover, DE 19901. University Place, New York, NY 10003. PARTNERS I LLC. Arts. of Org. filed Purpose: any lawful activity. General marketing, advertising, & Purpose: all lawful purposes. Purpose: any lawful act or activity. with Secy. of State of NY (SSNY) on public relations services. 01/09/15. Office location: NY County. Qualification of Blackstone Real Estate PAIGE PROPERTIES LLC, a foreign Notice of Qual. of Rapid Zone LLC, SSNY designated as agent of LLC Partners VIII.F L.P. Authority filed with LLC, filed with the SSNY on Notice of Qualification of 85 Broad Auth. filed Sec'y of State (SSNY) upon whom process against it may the Sect of State of NY (SSNY) on 12/12/14 under the fictitious name Propco LLC. Authority filed with NY 8/25/14. Office loc.: NY County. LLC be served. SSNY shall mail process 11/20/14. Office Loc: NY County. LP Paige Properties NY LLC. Office Dept. of State on 12/3/14. Office org. in DE 4/20/12. SSNY desig. as to Seward & Kissel LLP, Attn: David formed in DE on 11/12/14. SSNY has location: New York County. SSNY is location: NY County. Princ. bus. addr.: agent of LLC upon whom process E. Stutzman, One Battery Park Plaza, been designated as agent of LP upon designated as agent upon whom 200 State St., Ste. 5, Boston, MA against it may be served. SSNY shall NY, NY 10004. Purpose: Any lawful whom process against it may be process against the LLC may be 02109. LLC formed in DE on 11/13/14. mail copy of proc. to CSC, 80 State St., activity. served and shall mail process to: c/o served. SSNY shall mail process to NY Sec. of State designated agent of Albany, NY 12207. DE off. addr.: DE The Blackstone Group L.P., 345 Park The LLC, 94 Sturge Ridge Rd., Notice of Formation of Sun Way LLC upon whom process against it Corp. Organizers, 1201 N. Market St., Avenue, NY, NY 10154. DE address Wilton, CT 06897. General Purposes. International Holding LLC, Art. of Org. may be served and shall mail process Wilmington, DE 19801. Cert. of Form. of LP: 200 Bellevue Pkwy, Ste 210, filed Secy. of State of NY (SSNY) on to: c/o CT Corporation System, 111 on file: SSDE, Townsend Bldg., Dover, Wilmington, 19809. Name/addr of Notice of Qualification of VNO 33-00 04/03/2013. Office location: New 8th Ave., NY, NY 10011, regd. agent DE 19901. Purp.: any lawful activities. genl ptr avail from SSNY. Cert of LP Northern Blvd LLC. Authority filed York County. SSNY Designated as upon whom process may be served. filed with DE Sect of State, 401 with NY Dept. of State on 12/2/14. agent of LLC upon whom process DE addr. of LLC: c/o The Corporation Notice of Formation of Lau’s Realty Federal St, Ste 4, Dover, DE 19901. Office location: NY County. Princ. bus. against it may be served. SSNY shall Trust Co., 1209 Orange St., Associate LLC, Art. of Org. filed Purpose: any lawful activity. Wilmington, DE 19801. Cert. of Form. addr.: 210 Route 4 East, Paramus, NJ Secy. of State of NY (SSNY) on mail copy of process to: The LLC, 07652. LLC formed in DE on 11/19/14. 07/23/2014. Office location: New 148 Madison St., New York, NY filed with DE Sec. of State, 401 Qualification of Blackstone Real Estate NY Sec. of State designated agent of York County. SSNY Designated as 10002. Purpose: any lawful activity. Federal St., Dover, DE 19901. Partners VIII.TE.2 L.P. Authority filed LLC upon whom process against it agent of LLC upon whom process Purpose: all lawful purposes. with the Sect of State of NY (SSNY) may be served and shall mail process against it may be served. SSNY shall Notice of Formation of BEJO & LAPPAS, on 11/19/14. Office Loc: NY County. Notice of Formation of GOV BALL to: c/o CT Corporation System, 111 mail copy of process to: The LLC, 9 LLC. Arts. of Org. filed with Secy. of LP formed in DE on 11/12/14. SSNY 2015, LLC. Arts. of Org. filed with NY 8th Ave., NY, NY 10011, regd. agent Mott St., Suite #300, New York, NY State of NY (SSNY) on 06/27/14. has been designated as agent of LP Dept. of State on 11/17/14. Office upon whom process may be served. 10013. Purpose: any lawful activity. Office location: NY County. SSNY upon whom process against it may location: NY County. Sec. of State DE addr. of LLC: 1209 Orange St., designated as agent of LLC upon be served and shall mail process to: designated agent of LLC upon whom Wilmington, DE 19801. Cert. of Form. 35 PERRY ST. OWNERS LLC. Art. of whom process against it may be c/o The Blackstone Group L.P., 345 process against it may be served and filed with DE Sec. of State, 401 Org. filed with the SSNY on 12/02/14. served. SSNY shall mail process to Park Avenue, NY, NY 10154. DE shall mail process to the principal Federal St., Dover, DE 19901. Office: New York County. SSNY desig- Corporation Service Co., 80 State St., address of LP: 200 Bellevue Pkwy, Ste business address: 45 E. 9th St., Ste. Purpose: any lawful activity. nated as agent of the LLC upon whom Albany, NY 12207, regd. agent upon 210, Wilmington, 19809. Name/addr 46, NY, NY 10003, Attn: Thomas process against it may be served. SSNY whom and at which process may be Qualification of Blackstone Real Estate of genl ptr avail from SSNY. Cert of Russell. Purpose: any lawful activity. shall mail copy of process to the LLC, served. Purpose: Any lawful activity. Partners VIII L.P. Authority filed with LP filed with DE Sect of State, 401 c/o Karasyk & Moschella, LLP, 233 the Sect of State of NY (SSNY) on Federal St, Ste 4, Dover, DE 19901. Notice of Formation of HILL HOUSE Broadway, Suite 2340, New York, NY Notice of Qualification of Barclays 10/28/14. Office Loc: NY County. LP Purpose: any lawful activity. NY LLC. Arts. of Org. filed with Secy. 10279. Purpose: Any lawful purpose. Wealth Advisor Series - International formed in DE on 10/22/14. SSNY has Value Equity III L.P. Authority filed with of State of NY (SSNY) on 12/17/14. been designated as agent of LP upon Office location: NY County. SSNY Notice of Formation of COJI, LLC. NY Dept. of State on 1/8/15. Office Notice of Formation of FoxHog whom process against it may be location: NY County. Princ. bus. addr.: PRODUCTIONS LLC. Arts. of Org. designated as agent of LLC upon served and shall mail process to: c/o Arts. of Org. filed with Secy. of State whom process against it may be of NY (SSNY) on 12/08/14. Office 200 Park Ave., NY, NY 10166. LP filed with Secy. of State of NY (SSNY) The Blackstone Group L.P., 345 Park formed in DE on 11/17/14. NY Sec. of on 12/17/14. Office location: NY served. SSNY shall mail process to Avenue, NY, NY 10154. DE address location: NY County. SSNY designated c/o Paul Wrobleski, Clarfeld, 560 as agent of LLC upon whom process State designated agent of LP upon County. Princ. office of LLC: Sandra of LP: 200 Bellevue Pkwy, Ste 210, whom process against it may be Gotham Meehan, 220 E. 73rd St., Ste. White Plains Rd., Tarrytown, NY Wilmington, 19809. Name/addr of against it may be served. SSNY shall 10591. Purpose: Any lawful activity. mail process to Corporation Service served and shall mail process to: c/o 5C, NY, NY 10021. SSNY designated genl ptr avail from SSNY. Cert of LP CT Corporation System, 111 8th Ave., as agent of LLC upon whom process filed with DE Sect of State, 401 Co., 80 State St., Albany, NY 12207, Notice of Qualification of HAVAS regd. agent upon whom and at which NY, NY 10011, regd. agent upon against it may be served. SSNY Federal St, Ste 4, Dover, DE 19901. whom process may be served. DE shall mail process to the LLC at the WORLDWIDE, LLC. Appl. for Auth. Purpose: any lawful activity. process may be served. Purpose: filed with Secy. of State of NY (SSNY) Any lawful activity. addr. of LP: c/o The Corporation addr. of its princ. office. Purpose: Any lawful activity. on 03/20/14. Office location: NY Notice of Qualification of UE Trust Co., 1209 Orange St., County. LLC formed in Delaware (DE) Management LLC. Authority filed Notice of Qualification of Bedrock Wilmington, DE 19801. Name/addr. on 09/20/07. Princ. office of LLC: with NY Dept. of State on 11/18/14. Manufacturing Company, LLC. of genl. ptr. available from NY Sec. of Qualification of Blackstone Real Estate 200 Hudson St., NY, NY 10013. SSNY Office location: NY County. Princ. bus. Authority filed with NY Dept. of State State. Cert. of LP filed with DE Sec. Partners VIII.TE.1 L.P. Authority filed designated as agent of LLC upon addr.: 210 Route 4 East, Paramus, NJ on 1/12/15. Office location: NY of State, 401 Federal St., Dover, DE with the Sect of State of NY (SSNY) whom process against it may be 07652. LLC formed in DE on 10/7/14. County. LLC formed in TX on 5/30/14. 19901. Purpose: all lawful purposes. on 11/20/14. Office Loc: NY County. served. SSNY shall mail process to NY Sec. of State designated agent of NY Sec. of State designated agent of LP formed in DE on 11/12/14. SSNY Notice of Formation of Limited the LLC at the princ. office of the LLC. LLC upon whom process against it LLC upon whom process against it has been designated as agent of LP Liability Company (LLC) Name: 149 DE addr. of LLC: 2711 Centerville may be served and shall mail process may be served and shall mail process upon whom process against it may BAYARD LLC. Articles of Organization Rd., Ste. 400, Wilmington, DE 19809. to: c/o CT Corporation System, 111 to: c/o CT Corporation System, 111 be served and shall mail process to: filed by the Department of State of Cert. of Form. filed with DE Secy. of 8th Ave., NY, NY 10011, regd. agent 8th Ave., NY, NY 10011, regd. agent c/o The Blackstone Group L.P., 345 New York on: 10/29/2014. Office State, Townsend Bldg., 401 Federal upon whom process may be served. upon whom process may be served. Park Avenue, NY, NY 10154. DE location: County of New York. St., Ste. 3, Dover, DE 19901. Purpose: DE addr. of LLC: 1209 Orange St., TX and principal business address: address of LP: 200 Bellevue Pkwy, Purpose: any and all lawful activities. General marketing, advertising, & Wilmington, DE 19801. Cert. of Form. 1039 E. 15th St., Plano, TX 75074. Ste 210, Wilmington, 19809. Name/ Secretary of State of New York public relations services. filed with DE Sec. of State, 401 Cert. of Org. filed with TX Sec. of addr of genl ptr avail from SSNY. Cert (SSNY) designated as agent of LLC Federal St., Dover, DE 19901. State, 1019 Brazos, Austin, TX of LP filed with DE Sect of State, 401 upon whom process against it may Notice of Qualification of AITHON Purpose: any lawful activity. 78701. Purpose: all lawful purposes. Federal St, Ste 4, Dover, DE 19901. CAPITAL MANAGEMENT, LP. Appl. be served. SSNY shall mail a copy of Purpose: any lawful activity. for Auth. filed with Secy. of State of NY Notice of Qualification of RELATED Notice of Qualification of Carlyle Asia process to: c/o Bryan Min, 149 (SSNY) on 12/02/14. Office location: REAL ESTATE FUND II (FEEDER), L.P. Structured Credit Opportunities Bayard Street, Brooklyn, NY 11222. Notice of Qualification of APOLLO NA NY County. LP formed in Delaware Appl. for Auth. filed with Secy. of State Fund-A, L.P. Authority filed with NY MANAGEMENT II, LLC. Authority filed (DE) on 10/02/14. Princ. office of LP: of NY (SSNY) on 12/24/14. Office Dept. of State on 12/11/14. Office Notice of Qualification of BRIAR with Secy. of State of NY (SSNY) on 501 Madison Ave., 8th Fl., NY, NY location: NY County. LLC formed in location: NY County. LP formed in CAPITAL MANAGEMENT LLC. Appl. 12/17/14. Office location: NY County. 10022. SSNY designated as agent of Cayman Islands (C.I.) on 12/08/14. Cayman Islands (CI) on 11/17/14. NY for Auth. filed with Secy. of State of NY LLC formed in Delaware (DE) on LP upon whom process against it may Princ. office of LLC: 60 Columbus Sec. of State designated agent of LP (SSNY) on 11/17/14. Office location: 08/15/14. Princ. office of LLC: 9 W. be served. SSNY shall mail process Circle, NY, NY 10023. SSNY designated upon whom process against it may be NY County. LLC formed in Delaware 57th St., 43rd Fl., NY, NY 10019. SSNY to the Partnership at the princ. office as agent of LLC upon whom process served and shall mail process to the (DE) on 07/25/14. SSNY designated designated as agent of LLC upon of the LP. The regd. agent of the against it may be served. SSNY shall principal business addr.: c/o The as agent of LLC upon whom process whom process against it may be company upon whom and at which mail process to c/o Related Fund Carlyle Group, 520 Madison Ave., NY, against it may be served. SSNY shall served. SSNY shall mail process to process against the company can be Management, LLC at the princ. office NY 10022. CI addr. of LP: c/o mail process to c/o Corporation the LLC, Attn: John J. Suydam at the served is Harold Lehr at the princ. of the LLC. C.I. addr. of LLC: c/o Intertrust Corporate Services (Cayman) Service Co. (CSC), 80 State St., princ. office of the LLC. DE addr. of office of the LLC. Name and addr. of Maples Corporate Services Limited, Ltd., 190 Elgin Ave., George Town, Albany, NY 12207-2543. DE addr. of LLC: c/o Corporation Service Co., each general partner are available P.O. Box 309, Ugland House, Grand Grand Cayman KY1-9005, CI. Name/ LLC: c/o CSC, 2711 Centerville Rd., 2711 Centerville Rd., Ste. 400, from SSNY. DE addr. of LP: 2711 Cayman, C.I. KY1-1104. Cert. of Form. addr. of genl. ptr. available from NY Ste. 400, Wilmington, DE 19808. Wilmington, DE 19808. Arts. of Org. Centerville Rd., Ste. 400, Wilmington, filed with Registrar of Companies, P.O. Sec. of State. Cert. of LP filed with Cert. of Form. filed with Secy. of filed with the Secy. of State of the DE 19808. Cert. of LP filed with Box 123, Ground Fl., Government Registrar of Exempted LPs, Govt. State of the State of DE, Div. of State of DE, Dept. of State, Div. of Secy. of State of the State of DE, 401 Admin. Bldg., 133 Elgin Ave., George Administration Bldg., 133 Elgin Ave., Corps., John G. Townsend Bldg., Corps., John G. Townsend Bldg., Federal St., Dover, DE 19901. Town, Grand Cayman, C.I. KY1- George Town, Grand Cayman, CI. 401 Federal St. - Ste. 4, Dover, DE 401 Federal St., Ste. 4, Dover, DE Purpose: Any lawful activity. 9000. Purpose: Any lawful activity. Purpose: all lawful purposes. 19901. Purpose: Any lawful activity. 19901. Purpose: Any lawful activity.

20 | Crain’s New York Business | January 26, 2015 P020-21CL_CN_20150126.qxp 1/23/2015 8:18 AM Page 21

TO PLACE A CLASSIFIED AD, CALL 1-800-444-6007 OR EMAIL [email protected] PUBLIC & LEGAL NOTICES Notice of Qualification of 85 Broad DIMES BIG TIME LLC, a domestic Notice of Qualification of 2403 Notice of Qualification of Carlyle Asia Notice of Qualification of PROTEAN Property Manager LLC. Authority filed LLC, filed with the SSNY on QUEENS PLAZA NORTH LLC. Appl. Structured Credit Opportunities Fund, COMPANY, LLC. Appl. for Auth. filed with NY Dept. of State on 12/3/14. 11/26/14. Office location: New York for Auth. filed with Secy. of State of NY L.P. Authority filed with NY Dept. of with Secy. of State of NY (SSNY) on Office location: NY County. Princ. bus. County. SSNY is designated as agent (SSNY) on 01/08/15. Office location: State on 12/11/14. Office location: NY 12/24/14. Office location: NY County. addr.: 200 State St., Ste. 5, Boston, MA upon whom process against the LLC NY County. LLC formed in Delaware County. LP formed in Cayman Islands LLC formed in Delaware (DE) on 02109. LLC formed in DE on 11/10/14. may be served. SSNY shall mail (DE) on 12/23/14. Princ. office of (CI) on 7/18/14. NY Sec. of State 12/11/12. SSNY designated as agent NY Sec. of State designated agent of process to The LLC, Attn: Ms. LLC: 152 W. 57th St., 60th Fl., NY, designated agent of LP upon whom of LLC upon whom process against it LLC upon whom process against it Sabrina Desousa, 143 Division St., NY 10019. SSNY designated as process against it may be served and may be served. SSNY shall mail process may be served and shall mail process NY, NY 10002. General Purposes agent of LLC upon whom process shall mail process to the principal to c/o Corporation Service Co., 80 to: c/o CT Corporation System, 111 against it may be served. SSNY shall business addr.: c/o The Carlyle Group, State St., Albany, NY 12207-2543. 8th Ave., NY, NY 10011, regd. agent ACTIVE WORKING PARTNERS LLC, mail process to the LLC at the princ. 520 Madison Ave., NY, NY 10022. CI DE addr. of LLC: c/o CSC, 2711 upon whom process may be served. a domestic LLC, filed with the SSNY office of the LLC. DE addr. of LLC: addr. of LP: c/o Intertrust Corporate Centerville Rd., Ste. 400, Wilmington, DE addr. of LLC: c/o The Corporation on 11/12/14. Office location: New 2711 Centerville Rd., Ste. 400, Services (Cayman) Ltd., 190 Elgin DE 19808. Cert. of Form. filed with DE Trust Co., 1209 Orange St., York County. SSNY is designated as Wilmington, DE 19808. Cert. of Form. Ave., George Town, Grand Cayman Secy. of State, 401 Federal St., Dover, Wilmington, DE 19801. Cert. of Form. agent upon whom process against filed with DE Secy. of State, Div. of KY1-9005, CI. Name/addr. of genl. DE 19901. Purpose: Any lawful activity. filed with DE Sec. of State, 401 the LLC may be served. SSNY shall Corps., John G. Townsend Bldg., ptr. available from NY Sec. of State. Federal St., Dover, DE 19901. mail process to Rebecca Frankel, 37 401 Federal St., Ste. 4, Dover, DE Cert. of LP filed with Registrar of Notice of Formation of BFV Purpose: all lawful purposes. W. 72nd St., #7E, NY, NY 10023. 19901. Purpose: Any lawful activity. Exempted LPs, Govt. Administration Management LLC. Arts. of Org. filed General Purposes. Bldg., 133 Elgin Ave., George Town, with NY Dept. of State on 11/17/14. Notice of Formation of TYCHE, LLC. Notice of formation of 817 Second Grand Cayman, CI. Purpose: all Office location: NY County. Sec. of Arts. of Org. filed with Secy. of State Notice of Formation of DT 153 Avenue TC LLC. Arts of Org filed with lawful purposes. State designated agent of LLC upon of NY (SSNY) on 01/02/15. Office Bruckner LLC. Art/Org. filed with SSNY Secy of State of NY (SSNY) on 8/12/14. whom process against it may be location: NY County. SSNY designated 10/3/13. NY office location: NY Office location: NY Co. SSNY desig- SAN BLAS LLC. Art. of Org. filed served and shall mail process to the as agent of LLC upon whom process County. SSNY designated as agent nated agent upon whom process may with the SSNY on 10/23/14. Office: principal business address: 254 W. 54th against it may be served. SSNY shall for process. SSNY shall mail copy of be served & shall mail copy of process New York County. SSNY designated St., 10th Fl., NY, NY 10019, Attn: Tom mail process to Wendy L. Schoen, process to: c/o Princeton Holdings against LLC to principal business as agent of the LLC upon whom Viertel. Purpose: any lawful activity. 301 E. 62nd St., #14B, NY, NY 10065. LLC, 375 Park Ave., Ste 1604, NY, address:150 W28 St, Ste 403, NY NY process against it may be served. The regd. agent of the company NY 10152. Any lawful act or activity. 10001. Purpose:any lawful act. SSNY shall mail copy of process to Notice of Formation of HSC ATLANTIC, upon whom and at which process the LLC, 79 Washington Place, Suite LLC. Arts. of Org. filed with Secy. of against the company can be served Dana's Bakery NY, LLC. Arts. of Org. Notice of Formation of 153 East #1C, New York, NY 10011. Purpose: State of NY (SSNY) on 12/05/14. is Corporation Service Co., 80 State filed with Secy. of State of NY (SSNY) Broadway LLC. Arts. of Org. filed with Any lawful purpose. Office location: NY County. Princ. St., Albany, NY 12207. Purpose: Any on 10/16/14. Off. loc.: NY Co. SSNY Secy. of State of NY (SSNY) on office of LLC: 12 W. 23rd St., 4th Fl., Sun Arthur LLC. Arts. of Org. filed lawful activity. designated as agent of LLC upon 11/4/14. Office location: NY County. NY, NY 10010. SSNY designated as with Secy. of State of NY (SSNY) on whom process may be served. SSNY SSNY designated as agent of LLC agent of LLC upon whom process 12/09/14. Off. loc.: NY Co. SSNY NOTICE OF FORMATION OF Advance shall mail process to c/o Dana upon whom process against it may be against it may be served. SSNY shall designated as agent of LLC upon Global Health, LLC. Articles of Organ- Pollack, PO Box 662, Franklin Lakes, served. SSNY shall mail process to: mail process to Hope Street Capital whom process may be served. SSNY ization filed with the Secretary of State NJ 07417. Purpose: General. The LLC, 153 East Broadway, NY, NY LLC at the princ. office of the LLC. shall mail process to 52 Vanderbilt of NY (SSNY) on December 4, 2014. 10002. Purpose: any lawful activity. Purpose: Any lawful activity. Principal business address is 140 7th Notice of Formation of Parker Ave JV Ave., Ste. 403, New York, NY 10017. Purpose: General. Ave., NY, NY, 10011. SSNY has been LLC, Art. of Org. filed Sec'y of State Notice of Formation of IMA Systems Notice of Formation of INTER-PROJECTS (SSNY) 5/23/14. Office location: NY designated as agent upon whom LLC Arts. of Org. filed with Secy. of Notice of Formation of Steuben Debt ARCHITECTURE, PLLC. Arts. of Org. process against it may be served. County. SSNY designated as agent State of NY (SSNY) on 12/19/14. filed with Secy. of State of NY of LLC upon whom process against LLC, Art. of Org. filed Sec'y of State Purpose: any lawful act or activity. Office location: NY County. SSNY (SSNY) 3/17/14. Office location: NY (SSNY) on 11/25/14. Office location: it may be served. SSNY shall mail designated as agent of LLC upon NY County. SSNY designated as Notice of Formation of 215 Moore St County. SSNY designated as agent copy of process to Bluestone Group, whom process against it may be agent of PLLC upon whom process Development LLC. Arts. of Org. filed of LLC upon whom process against 225 Broadway, NY, NY 10007. served. SSNY shall mail process to against it may be served. SSNY shall with Secy. of State of NY (SSNY) on it may be served. SSNY shall mail Purpose: any lawful activities. c/o Corporation Service Co., 80 mail process to c/o Seth E. 12/3/14. Office location: NY County. copy of process to Bluestone Group, State St., Albany, NY 12207-2543. Zuckerman, Esq., 18 Columbia Tpke, SSNY designated as agent of LLC Notice of Formation: Greenpoint 225 Broadway, NY, NY 10007. Purpose: Any lawful activity. Ste, 200, Florham Park, NJ 07932- upon whom process against it may Pencil Works LLC, files with SECY of Purpose: any lawful activities. 2266. Purpose: Architectural. be served. SSNY shall mail process State of NY on 11/19/14. Off. Loc.: MTC Construction LLC, Articles of Bond Street Capital Group LLC. Arts. to: c/o The LLC, 711 , NY County. SSNY designated as Org. filed N.Y. Sec,. of State (SSNY) of Org. filed with Secy. of State of Notice of formation of Tres Carnes 16th Fl., NY, NY 10022. Purpose: any agent of LLC upon process may be 30th day of October 2014. Office in NY (SSNY) on 10/30/14. Off. loc.: NY 391 8th Avenue LLC. Arts of Org filed lawful activity. served. SSNY shall mail process to: New York Co. at 61 W 82nd St, Suite Co. SSNY designated as agent of with Secy of State of NY (SSNY) on 160 6th Ave., #3, NY, NY 10013. 1B New York, NY 10024. SSNY LLC upon whom process may be 11/20/14. Office location: NY Co. SSNY Notice of formation of IBP Group LLC. Purpose: Any Lawful Activity. design. agt. upon whom process may served. SSNY shall mail process to designated agent upon whom process Articles of organization filed with the be served. SSNY shall mail copy of 460 Park Ave South, Ste. 204, New may be served & shall mail copy of Secretary of State of N.Y. (SSNY) on Notice of Formation of Peninsula process to 61 W 82nd St, Suite 1B, York, NY 10016. Purpose: General. process against LLC to principal 10/28/2014. Office location: New York Realty Holdings LLC, Art. of Org. filed New York, NY 10024. Reg. Agt. upon business address: 150 W28 St, Ste 403, County. SSNY has been designated Sec'y of State (SSNY) 7/2/14. Office whom process may be served: Notice of formation of Assure Global NY NY 10001. Purpose:any lawful act. as agent of the LLC upon whom location: NY County. SSNY designated Spiegel & Utrera, P.A., P.C. 1 Maiden LLC. Arts of Org filed with Secy of process against it may be served. as agent of LLC upon whom process Lane, NYC 10038. 1 800 576-1100 State of NY (SSNY) on 12/11/14. SSNY shall mail process to the LLC, against it may be served. SSNY shall Notice of formation of Assure Funding Purpose: Any lawful purpose. Office location:NY Co. SSNY desig- LLC. Arts of Org filed with Secy of 350 Fifth Ave, 59FL, Ste 5900, New mail copy of process to Bluestone nated agent upon whom process may York, NY 10118. Purpose: Any lawful Group, 225 Broadway, NY, NY 10007. Notice of Qualification of AITHON State of NY (SSNY) on 12/11/14. Office be served & shall mail copy of process location: NY Co. SSNY designated activity. Purpose: any lawful activities. CAPITAL GP LLC. Appl. for Auth. filed against LLC to principal business with Secy. of State of NY (SSNY) on agent upon whom process may be address:150 W28 St, Ste 403, NY NY served & shall mail copy of process Notice of Qualification of TribeTats Notice of Qualification of SHS Upper 12/02/14. Office location: NY County. 10001. Purpose:any lawful act. LLC. Appl. for Auth. filed with Secy. City NY II LLC. Authority filed with LLC formed in Delaware (DE) on against LLC to principal business of State of NY (SSNY) on 10/30/14. Secy. of State of NY (SSNY) on 11/06/14. Princ. office of LLC: 501 Notice of Qualification of Budget address:150 W28 St, Ste 403, NY NY Office location: NY County. LLC 12/08/14. Office location: NY County. Madison Ave., 8th Fl., NY, NY 10022. Travel, LLC. Authority filed with NY 10001. Purpose:any lawful act. formed in Delaware (DE) on 10/20/14. LLC formed in Delaware (DE) on SSNY designated as agent of LLC Dept. of State on 10/7/14. Office Princ. office of LLC: 79 Madison Ave., 05/21/14. SSNY designated as agent upon whom process against it may be location: NY County. Princ. bus. NOTICE OF FORMATION OF SHINE Fl. 3, NY, NY 10016. SSNY designated of LLC upon whom process against it served. SSNY shall mail process to addr.: 499 7th Ave., 18th Fl., South GLORY LLC. Arts of Org filed with as agent of LLC upon whom process may be served. SSNY shall mail the LLC at the princ. office of the LLC. Tower, NY, NY 10018. LLC formed in Secy of State of NY (SSNY) on against it may be served. SSNY shall process to: c/o Cheer Land The regd. agent of the company upon DE on 2/25/14. NY Sec. of State 11/19/14. Office location: NEW YORK mail process to c/o Corporation Investments Group Limited, 152 West whom and at which process against designated agent of LLC upon whom County. SSNY designated agent upon Service Co. (CSC), 80 State St., 57th St., Ste. 3901, NY, NY 10019. the company can be served is Harold process against it may be served whom process may be served and Albany, NY 12207-2543. DE addr. of Address to be maintained in DE: Lehr at the princ. office of the LLC. and shall mail process to: PO Box shall mail copy of process against LLC: c/o CSC, 2711 Centerville Rd., Corporation Service Company, 2711 DE addr. of LLC: c/o Corporation 680999, Franklin, TN 37068-0999. LLC to principal business address: Ste. 400 Wilmington, DE 19808. Cert. Centerville Rd., Ste. 400, Wilmington, Service Co., 2711 Centerville Rd., Ste. DE addr. of LLC: 1209 Orange St., 8514 Broadway, Apt.5A, Elmhurst, of Form. filed with Secy. of State, DE 19808. Arts of Org. filed with the 400, Wilmington, DE 19808. Cert. of Wilmington, DE 19801. Cert. of Form. NY 11373. Purpose: any lawful act. John G. Townsend Bldg., 401 DE Secy. of State, John G. Townsend Form. filed with Secy. of State of the filed with DE Sec. of State, 401 Federal St.-Ste. 4, Dover, DE 19901. Bldg., 401 Federal St., Dover, DE State of DE, 401 Federal St., Dover, DE Federal St., Dover, DE 19901. NOTICE FOR FORMATION of a limited Purpose: Any lawful activity. 19901. Purpose: any lawful activities. 19901. Purpose: Any lawful activity. Purpose: all lawful purposes. liability company (LLC). The name of the limited liability company is 53 EAST 7 STREET LLC. The date of filing of the articles of organization with the Department of State was November 18, 2014. The County in New York in WANT TO GET YOUR COMPANY IN FRONT OF which the office of the company is located is New York. The Secretary of NEW YORK CITY’S INFLUENTIAL State has been designated as agent of the company upon whom process may be served, and the Secretary of BUSINESS PROFESSIONALS? State shall mail a copy of any process against the company served upon him or her to c/o Stefka Nazarkewycz, 182 Contact Joanne Barbieri at 212-210-0189 2nd Avenue, Apt #2, New York, New York 10003. The business purpose of for classified advertising opportunities. the company is to engage in any and all business activities permitted under the laws of the State of New York.

January 26, 2015 | Crain’s New York Business | 21 20150126-NEWS--0022-NAT-CCI-CN_-- 1/22/2015 5:24 PM Page 1

IN THE BOROUGHS MANHATTAN

customers visiting the other two stores actually lived uptown. On a Woo-hoo! UES is hot recent chilly afternoon, the 2,900- square-foot,two-level store on Lex- Continued from Page 3 on the Upper East Side now than ington—the former home of 100- ple with beards and tattoos, not to there have ever been,” said Jill Lo- year-old Lascoff Drugs—bustled mention those who eat vegan vatt, a retail leasing broker at Cush- with customers. muffins.Lured to the neighborhood man & Wakefield, who lives in the “The store’s doing incredibly by rents that are well below those in neighborhood. “Retailers and well,” said Mr. Gilboa, noting that a Williamsburg and the Lower East restaurateurs from downtown are lot of shoppers in the neighborhood Side, and a plethora of building saying, ‘Wait a are excited to be able to walk to the types—from walk-ups to high- minute, some of MONTHLY store rather than trek downtown. rises—young creatives are stream- our customers RENTS Other retailers talk of similar ing in and giving the area a new vibe. are uptown.’ ” experiences. Yumi Kim, a popular Retailers from Warby Parker to the That was the $1,750 women’s clothing brand with a Meatball Shop have noticed the case for five- STUDIO on store on the Lower East Side, seismic shift and opened stores to year-old eye- E. 85th St., UES opened a second one on Third Av- capture the new crowd. wear brand War- enue and East 76th Street in 2011. by Parker. The Nearby, in a prime location on the Big brands move in $2,095 Manhattan- STUDIO on corner of East 74th Street and Meanwhile, larger brands, such as based company, Orchard St., LES , Apple is expect- buck ennis Apple,are planning outposts.Brokers known for its ed to open a store this year in a for- THE RIGHT RECIPE: Kathryn Creech bakes in Brooklyn but lives in the more affordable UES. predict the trend will only intensify as $95 fashion mer bank branch, where it will pay more retailers feel the pull of the Up- frames, opened $2,300 an annual rent of a cool $3.8 mil- STUDIO on per East Side’s changing demograph- its first store in Wythe Ave., lion. Work to convert the space is outpost at 1462 Second Ave.Today, “There’s a ton of retail,” said the ics, coupled with its relatively inex- SoHo,its second Williamsburg already underway. the 100-seat restaurant is the six- 32-year-old, noting that more and pensive shop rents.The long-awaited in the meatpack- The neighborhood’s famously unit chain’s highest-volume store— more places have popped up in the completion of the first leg of the Sec- ing district, and for its third last well-heeled bar and restaurant scene outgrossing locations in Williams- past six months alone. Ms. Gursky, ond Avenue subway, slated for 2016, spring chose a location on Lexing- is also loosening up and beginning burg and on the Lower East Side. like Ms. Creech, also looked at oth- is expected to enhance the neighbor- ton Avenue and East 82nd Street. to rival areas in the city known as Meanwhile, the gastropub Pen- er areas in the city. “I realized the ’s drawing power. Co-founder Dave Gilboa said the party destinations. Just over a year rose, and craft beer and bourbon bar sizes of the apartments, and what I “There are more young people brand discovered that many of the ago, the Meatball Shop opened an Bondurants, have also recently got for my money, were so much opened,joining Café Jax,which sells more here,” she said. coffee upstairs and antiques down- For retailers, the picture is much stairs. Even a vegan bakery, selling the same.Madison Avenue has long th homemade granola and mini- had some of the city’s highest shop 4 Annual Join Crain’s and New York doughnuts, now does a brisk busi- rents, ranging as high as $2,000 per ness over on First Avenue. square foot, but rents typically drop off quickly on the side streets or the real estate’s most impressive ‘Great alternative’ avenues to the east. REAL ESTATE “Unless you’re rich, there’s no On , asking players to explore the next possibility of living [downtown],” prices range from $150 to $600 per explained Daniel Holzman, co- square foot, while First Avenue stage in the city’s development. owner of the Meatball Shop, noting commands between $85 and $100 a that residents of the area need more square foot. That compares with CONFERENCE retail options.“The Upper East Side $250 per square foot for retail space is a great alternative.” on Bedford Avenue in Williams- Younger residents find all the burg or more than $700 per square new eating and shopping options foot on Broadway in SoHo. PLANNING THE NEW NEW YORK particularly appealing. Rachel As long as there is a Park Avenue, Gursky, a marketing executive who not to mention apartments over- paid $1,750 to live in a studio on looking along Fifth, OPENING DISCUSSION East 85th Street for three years be- the Upper East Side will never be- TUESDAY, MARCH 17, 2015 fore recently moving into a two- come exactly edgy, but many ob- Chairman of the NYC Planning bedroom on East 74th Street with servers and residents say it has her boyfriend, is delighted by the moved a surprisingly long way back Commission Carl Weisbrod 180 Central Park South new crop of shops flooding the area. toward the modern mainstream. Ⅲ will unveil the de Blasio Networking Breakfast: 8:00a.m.-8:30a.m. administration’s latest zoning Program: 8:30a.m.-12:00p.m. rent studios and exhibit their work, policies and urban-planning FROM and for musicians to perform. COST TO ATTEND: AROUND Cesar Claro, the organization’s initiatives. president, said he hopes the initia- $300 for individual ticket(s) THE CITY Carl Weisbrod tive will support local talent while $3,000 for table(s) of ten also serving as a magnet for a com- PANEL DISCUSSIONS $4,000 for a table of ten and a full page STATEN ISLAND mercial strip such as New Dorp Lane, which currently has a number > Restaurant Tenants Tell All: journal ad in the event program. Group seeks of empty storefronts. Wylie Dufresne, Chef and Owner, Alder restaurant You must be pre-registered to attend this event. space for artists The request for proposals No refunds permitted. marks the SIEDC’s attempt to > Affordable Housing: Last summer, when Staten Island find “creative solutions”to drawing Joshua Barro, Domestic Correspondent, New York Times, For more information: native Maggie Vasconi began book- traffic to strips with vacancies, Mr. ing gigs for the borough’s musicians, Claro said. He added that the The Upshot Adrienne Yee Phone: 212-210-0739 she ended up using a locale in the group expects the space will host Seth Pinsky, Executive Vice President, Fund Manager, Crown Heights section of Brooklyn. artists with “constituencies,” Metro Emerging Markets & Public Affairs Director, RXR Realty Email: [email protected] “I’d love to book bands on Staten meaning enough fans to lure visi- Island,” said Ms. Vasconi, 24. “I tors to the site. would love to show off some talent, John Rodriguez, industrial busi- Additional speakers to be announced. << REGISTER TODAY >> if we had the proper space here.” ness development manager for the crainsnewyork.com/events-realestate2015 Today, she and others are talking SIEDC,said the organization’s plan with the Staten Island Economic will partially depend on how large a Development Corp. about how best space it can obtain. “The more the to create more venues for artists in merrier, of course,” he says. So far, the borough. The SIEDC has been the biggest one he has located is kicking around ideas since March 13,000 square feet,but he doesn’t yet and recently requested an expres- know if the owner will allow that site For sponsorship opportunities, contact Joanna Harp at 212-210-0278 or [email protected] sion of interest from developers to be developed for artists. willing to create a venue for artists to —wendy davis

22 | Crain’s New York Business | January 26, 2015 20150126-NEWS--0023-NAT-CCI-CN_-- 1/23/2015 7:48 PM Page 1

Which way for Fairway?

Continued from Page 1 With its new private-equity Fairway is also deeply in cue.But make no mistake—Fairway owner, Fairway had the cash to take debt, carrying more than a faces serious challenges. its show on the road, and soon new quarter-billion dollars in lia- The firm has lost hundreds of stores popped up in Westchester bilities incurred to finance ex- millions during the past few years, County,Long Island and Stamford, pansion. Interest payments and its ambitious growth plans have Conn. But while the newer stores take an annual $20 million stalled. Investors have washed their may offer the same alluring mer- bite out of a company fighting hands, driving down the stock by chandise, they sometimes lack the for every dollar. 83% last year. At one point last snap and crackle that make the week,the stock fetched less than the Upper West Side site such a draw. Management shuffles price of a half gallon of Fairway “Creating that kind of atmos- Unexpectedly shabby fi- grass-fed organic milk, though it phere takes longer than most in- nancial performance has trig- has since risen a bit higher, to $4.34. vestors have patience for,” said Bob gered numerous changes in “Their problems are hard to fix,” Goldin, executive vice president at the management suite. Last said Burt Flickinger, a supermarket Technomic, a food consulting firm. February, the company’s consultant. “The basic issue is they Fairway raised $159 million in an CEO stepped down, and a overreached.” initial public offering in April 2013, Sterling executive filled in Mr. Murphy disagrees. The but $86 million of the proceeds were until Mr. Murphy was hired company’s problems are readily fix- paid to Sterling rather than invest- last September. In Decem- able,he said,and after tackling them ed in new stores. Fairway’s public ber, Howard Glickberg, a this year he expects to start opening filings, along with information con- longtime CEO in the pre- new stores again. He has no plans to tained in a shareholder lawsuit filed IPO days and later an execu- close any of Fairway’s 15 locations, last year, show that between divi- tive in charge of develop- though he says certain suburban ment, announced his outposts need to shrink. retirement, effective imme- “Fairway is like a giant jigsaw ‘Fairway is like diately. The 67-year-old Mr. puzzle that’s scattered,” said Mr. a giant jigsaw Glickberg, who remains a Murphy, dressed in jeans and an board member,said he enjoys HE’S READY open-collar shirt as he gave an inter- not having to go to stores TO PRODUCE: New view at Fairway headquarters near puzzle that’s every day but wouldn’t com- CEO Jack Murphy West 125th Street. “But all the ment further. No founding- insists Fairway’s pieces are there.” scattered’ family members remain ac- problems are fixable. So how did a retailer whose tive in day-to-day affairs. stores were so popular that openings Mr. Murphy came out of were treated as major neighborhood retirement to run Fairway af- news become “scattered”? ter stepping down last April The answer lies in Fairway’s his- dend payments, management fees, as CEO of Earth Fare, a tory, the modern chapter of which management-termination fees and North Carolina-based chain began in 2007 when Sterling Invest- stock sales, Sterling has made about of natural- and organic-food ment Partners, a Westport, Conn.- $105 million in cash from Fairway, markets. Mr. Murphy said based private-equity firm, acquired more than the $97 million in cash he’s been working to improve an 80% stake for about $150 million. used to help pay for the acquisition. Fairway’s internal operations Sterling had a history of investing in Sterling would not comment. and boost morale damaged by such sectors as shipping, trucking In any case, new store openings the steep decline in the com- and tire manufacturing, according drove up Fairway’s revenue to nearly pany’s stock price. He has be- to its website, but Fairway marked $800 million last fiscal year, nearly gun emphasizing analysis of its first foray into supermarkets. double its 2010 level. But rapid sales data to better under- buck ennis growth couldn’t mask Fairway’s un- stand what makes merchan- Only in New York derlying weakness: It struggled to dise move. He calls it “price opti- may be negotiating a new collective paign to reintroduce Fairway to Fairway, as the slogan goes, was keep people coming back. Sales de- mization,” though he insisted that bargaining agreement with grocery shoppers. He is working closely like no other market. It started as a clined at stores open more than a year doesn’t mean raising prices. union UFCW Local 1500 even as with Chief Merchandising Officer fruit and vegetable stand in 1933, as new competitors moved in.For in- “This company was built from he seeks what he describes as “labor Dorothy Carlow, who joined him and over the decades the founding stance, comparable-store sales fell by the roof down,and the house was on efficiencies.”The contract that cov- from Earth Fare. Glickberg family built their flagship 3.9% in the quarter ended last Sept. stilts,” he said. “We just need to se- ers about three-quarters of Fairway Mr. Murphy declined to offer store on Broadway and West 74th 28, which Fairway attributed to a cure the pylons, and that means us- employees expires in March, and in specifics on the ad campaign but as- Street into a mecca boasting the competitor—that would be Whole ing available technology to make us an effort to set the tone for negotia- sured it would make a splash. As an area’s best selection of everyday food Foods—opening not far from its Red better.” tions, Mr. Murphy said Fairway example of the impact he has in mind, and harder-to-find gourmet items. Hook, Brooklyn, location. More visibly to shoppers, store maintained workers’ hours so they he recalled an ad produced by a chain The combination of high-quality Such declines caused losses at- layouts will be changed. Some cus- could qualify for employer-mandat- of fitness clubs that featured creatures groceries and competitive prices was tributable to common stockholders tomers complain that natural and ed health care coverage, even from the horror movie Alien and the a revelation to consumers accus- to widen to about $85 million over the organic foods are separated from though financially it would have slogan “When they come, they’ll eat tomed to weary old A&Ps, Gris- six-month period ended last Septem- processed items, driving up shop- made sense to reduce their shifts. the fat ones first.” tedes and Sloan’s. Huge crowds ber. During the past five years, the ping times. “We will be adjusting “I want people to be more pro- Ms. Carlow cringed. “That,” she meant that shopping at Fairway was company has piled up $400 million in adjacencies to make the shopping ductive and more available,”he said. said,“is one message we won’t use.”Ⅲ a frenetic only-in-New York experi- losses, and in its most recent annual experience convenient and easy,” “We need to do it the right way.” ence that came to resemble a com- report warned that it expects losses to Mr. Murphy said. Finally, Mr. Murphy is planning LISTEN to a discussion at CrainsNewYork.com/podcasts petitive sport. continue until at least 2018. His biggest near-term challenge to launch a major advertising cam-

cation and health services added firms then, but now we do.” The city’s private-sector growth Top trending NY jobs 29,800 jobs through the Ms. Denham’s analysis rate of 2.7% during the year out- year, while trade, trans- showed health services paced the state’s 1.7% and the na- portation and utilities 2.7% adding the most jobs from tion’s 2.5%. Continued from Page 3 JOB GROWTH in global economy have reduced.” added 9,100. the city in 2014, November to December, New York City’s seasonally ad- key city industry. The Labor Department also ex- Jobs in advertising, a outpacing both with 2,700, followed by justed unemployment rate remained “The financial sector has been pects rapid wage growth for inter- subsector of professional the state (1.7%) restaurants, with 2,400. at 6.3%, the same as in November, struggling,” she said. “I want to see preters and translators (median in- and business services,grew and the nation She said a number of indus- ending five months of declines. In a these gains for a few months to make come:$63,460);meeting,convention steadily through the year (2.5%) tries lost jobs in 2014, in- positive sign for the economy, the sure that they’re going to continue.” and event planners ($59,690); and and finished 2014 with cluding 1,000 in wholesale city’s rate was down 1.7 percentage Independent economist Barbara child-care workers ($26,560). 67,400 jobs, the highest figure ever. trade and 600 in transportation. points from December 2013, even as Byrne Denham,however,saw a pos- Professional and business servic- Ms. Volovelskaya attributed adver- “New York City did not break the labor force grew by 1.6%, to 4.1 itive outlook for the industry in es added 30,700 positions in the 12- tising’s gains to big tech firms, such any job-growth record in 2014,” she million. The state’s unemployment 2015. “There are a lot of signs that month period ended in December, as Google, setting up offices here. wrote in her report.“While the year rate dipped one-tenth of a percent- this industry has really bottomed,” the largest growth by sector. Leisure “A lot is sticking, unlike in the ended on a high note, the city did age point, to 5.8%. Ⅲ she said. “Even in the last couple of and hospitality grew the fastest, at first dot-com boom,” she said. “We not add 100,000 jobs, as the trend days, many of the risk factors in the 5.1%, and added 19,500 jobs. Edu- didn’t get a lot of the West Coast had been suggesting at midyear.” Chris Bragg contributed reporting.

January 26, 2015 | Crain’s New York Business | 23 20150126-NEWS--0024-NAT-CCI-CN_-- 1/23/2015 7:49 PM Page 1

millennials is searching out quality plans to open more than 10 new Strong dollar saps Tiffany sales labels that might not be found in stores a year.Last year,it launched its their mother’s jewelry box. Such first outpost in Moscow. Others are shoppers seek jewelry that is not os- expected to follow elsewhere in Eu- Continued from Page 3 City flagship store on Fifth lowed by Switzerland’s tentatious, for instance, and that rope and in Asia. “It was a bit of a head-scratcher Avenue, which represents Richemont, whose brands might even feature a technology for the financial community,” said 8% of total sales. A signifi- include Chloé and Cartier, component, such as a step tracker. Well spread out Anne-Charlotte Windal, a senior cant portion of those are or even by Mr. Cumenal’s “The generation to replace the “Tiffany benefits from its diversi- retail analyst at Bernstein Research. generated by international former employer, LVMH. boomers, who were the core luxury fied geographic presence,”wrote No- “Everyone had strong expectations tourists. In another management consumers, has a whole different mura analyst Robert Drbul in a re- for [the company’s] holiday season.” change, Tiffany last week view on lifestyles,” explained Robin search note. He added that such The unexpected downdraft Changes at the top tapped Jennifer de Winter,a Lewis, chief executive of The Robin variety should help Tiffany weather comes at a difficult time for the 178- “We are planning cau- Michael Kowalski well-regarded Saks chief Report, a retail-strategy online tougher economic conditions. year-old jeweler. Its longtime chief tiously as we anticipate sig- merchant with experience newsletter. “[Tiffany] has to market The jeweler will report sales for executive will step down in the nificant headwinds from in the jewelry division, to be to them differently.” the fiscal year ending Jan. 31 in spring, and the surging value of the the stronger U.S. dollar,” senior vice president of To do that,in August Tiffany in- March. Earlier this month, it re- dollar is depressing sales in overseas said Frederic Cumenal, North America. In her new troduced its T Collection, a line of duced its net earnings outlook for markets as well as among foreign Tiffany’s president, in a role,one of her priorities will gold fashion jewelry featuring the the year to a range of $4.15 to $4.20 visitors here. In addition, the brand statement. The company be to lure back some of those letter T, with a starting price of just per share, though in November, finds itself struggling to appeal to a declined to comment di- tourists who have recently under $350—about $100 higher Tiffany had reaffirmed year-end new generation of shoppers. rectly. shunned the brand. Ana- than previous collections. Well re- earnings expectations of $4.20 to

Tiffany,which posted worldwide Meanwhile, Chief Ex- ap images; newscom lysts applauded her arrival. ceived by critics—one likened it to $4.3 0 per share. revenue of $4 billion in the fiscal ecutive Michael Kowalski, Frederic Cumenal “Tiffany makes another “Tiffany & Co.’s cooler younger sis- Analysts are cautiously opti- year ended Jan. 31, 2014, logs the 62,who has run the firm for sparkling hire to lead the ter”—the line aims to appeal to a mistic but expect the brand’s results bulk of its sales overseas. As such, it 15 years, will hand over the U.S.,” wrote Ike Boruchow, broader demographic. Analysts ex- to be tied to spending in the U.S. is feeling the pressure of a sharp rise reins to Mr. Cumenal, who joined an analyst at Sterne Agee, in a recent pect to see more such products in “If you see a continuing strong in the value of its home currency Tiffany from Paris-based luxury- note. coming months. dollar, it could really have a negative against what is in the wallets of goods giant LVMH less than four Like many other luxury-goods Tiffany is also broadening its impact on Tiffany’s sales in the next many of its international customers. years ago. Mr. Cumenal’s rise, cou- companies, Tiffany must also come reach abroad, where it already has 12 months,” said Bernstein Re- Against the euro, for example, pled with the 54-year-old compa- to grips with shifting shopper tastes. 173 stores out of its total of 296.That search’s Ms. Windal. Ⅲ the dollar has gained 15% in the past ny’s recent earnings stumble, is al- The baby boomers who have long ac- expansion is critical as it competes six months.That shift is even hitting ready fanning speculation that counted for much of Tiffany’s sales with Cartier, the world’s largest lux- LISTEN to a discussion at sales at the company’s New York Tiffany could end up being swal- are aging, and the new generation of ury player. Tiffany has announced CrainsNewYork.com/podcasts

ited. And the governor and Senate lawyer special interests who have how to take advantage of suburban Tarnished Silver majority leader, who are more con- lorded over Albany for too long.” Republicans’need for school-aid in- cerned with the upstate economy, One labor official predicted that creases to protect teacher interests in may sour on the idea of showering because construction-worker unions a masterful way, and I’m not sure Continued from Page 1 the real estate industry than expect- the speaker’s district with lucrative and trial lawyers have solid relation- someone else or a distracted [As- change the calculus in the state cap- ed”during the 2011 reauthorization incentives. ships with Mr. Cuomo and Senate sembly] staff could do that as well.” ital whether he perseveres—the As- of rent laws. Republicans, the scaffold law and Teachers’ union allies nonethe- sembly has had three speakers serve “It would appear that he [Silver] ETHICS LAWS other tort reforms will likely re- less professed confidence that As- under indictment since 1973—or could have successfully pushed for Scandal has marred the New York mained unscathed. sembly Democrats, with or without steps down. more,” according to the document, Legislature for years, but the Silver But Joseph Morelle, the Assem- Mr. Silver, would remain steadfast- Measures that were thought which was detailed in the U.S.attor- case is of a greater magnitude be- bly majority leader who spoke for ly on their side. dead—meaningful ethics reform, ney’s complaint. The revelation cause of the speaker’s immense im- the Democratic conference as Mr. “I don’t anticipate it will change for one—suddenly look viable, could stiffen Assembly Democrats’ portance and because it exposes Silver was arraigned, favors repeal- anything in terms of how this budget while interest groups that counted resolve for a better deal this time. Albany’s pay-to-play culture and the ing the scaffold law. Even support- [is negotiated],”said Billy Easton,ex- on Mr. Silver to champion their “The rent-laws fight was already problems posed by lawmakers hold- ers of the law see risks with Mr. Sil- ecutive director of the union-backed causes are unsure how to proceed. an uphill climb [for the pro-tenant ing outside jobs. ver under siege. Alliance for Quality Education. “No “There’s no script for this,” said side] and will now be even more Immediately after Mr. Silver’s ar- “It will create a little more vul- evidence has been presented in court Richard Brodsky, a former Assem- challenging,” said an operative with rest, good-government group Com- nerability for the trial lawyers,” said yet, and we don’t know how this will bly Democrat. “It’s chaos.” ties to affordable-housing groups, mon Cause/NY called for an over- ex-Assemblyman Dan Feldman, a play out, but we do know it will take Or, as Mayor Bill de Blasio con- “unless a weakened Shelly is so haul of ethics oversight, more former executive director of the more than a few months’ time. Shel- ceded to a scrum of reporters last tainted by his ties to real estate mon- extensive income disclosure, stricter New York State Trial Lawyers As- don Silver is still the speaker of the week in Washington, D.C.: “I think ey that he has to tack left on rent regulation of lobbyists and sociation.“But let’s not get ahead of Assembly. What gives him the pow- this will be a distraction for everyone laws to redeem himself and show he campaign-finance reforms to dimin- ourselves.” er to negotiate effectively is the sup- in Albany. I think it will change the isn’t doing the bidding of landlords.” ish the role of money in state politics. port of his members.” nature of this session; there is no What had seemed like a hopeless EDUCATION doubt about that.” REAL ESTATE TAX BREAKS cause now has momentum, as Mr. The day before the arrest, Gov. An- POLITICS Here are issues that will likely be Some experts are wondering how Cuomo and legislators—including drew Cuomo unveiled an ambitious The hobbling of Mr. Silver gives affected by Mr. Silver’s arrest: Mr. Silver can credibly handle the Mr.Silver—are under pressure to re- education agenda, including raising Mr. Cuomo the upper hand on a extension of the 421-a program, store public trust in government. the statewide cap on charter schools number of key issues and solidifies RENT REGULATION which provides tax abatements for Mr. Cuomo recently announced by 100 and eliminating New York his power in the state capital. The city’s rent laws expire in June, new apartments, after Mr. Bharara plans to form a commission that City’s individual cap, making teacher “The Shelly Silver industrial and tenant advocates were counting accused him of leveraging his con- would potentially raise lawmakers’ evaluations more rigorous, weaken- complex will be supplanted by an on Mr. Silver to secure a favorable trol over it to induce real estate de- pay in exchange for the reforms. ing teacher tenure and shutting Andrew Cuomo industrial complex, deal for renters in the reauthoriza- velopers to hire a small law firm that schools that struggle for three straight for better or for worse,”said Kenneth tion—especially since landlord- paid the speaker $700,000. Other TORT REFORM years. If it passed, he would add $723 Sherrill, professor emeritus of polit- friendly Republicans won full con- tax breaks important to the real es- Mr. Silver, with his close ties to the million in state education aid. ical science at Hunter College. “Sil- trol of the state Senate in tate industry,such as the 80/20 pro- New York State Trial Lawyers As- The city’s powerful teachers’ ver, for many reasons, was an inde- November’s elections. gram, also expire this year. sociation, has long been viewed as union president called the plan pendent power center in Albany.” Conventional wisdom is that Maintaining lower Manhattan’s the primary roadblock to changes to “warmed-up Bloomberg leftovers.” Both Mr. Sherrill and Mr. Brod- Mr.Silver’s arrest weakens the cause lucrative package of tax breaks and the state’s tort laws, notably the so- And Mr.Silver,a staunch union ally, sky said Mr. Cuomo will have a de- for stronger rent laws, including incentives has always been a high called scaffold law,which holds con- said he saw no reason to raise a ciding voice in the post-Silver era. measures that prevent landlords priority for Mr. Silver. tractors and property owners 100% charter-school cap that hadn’t been But Jonathan Bing, a former Assem- from shifting rent-regulated apart- Last year, Mr. Silver praised Mr. liable for any gravity-related acci- reached. He was expected to fight bly Democrat and Cuomo adminis- ments to the free market. Cuomo for including the incentives dent in which they are even partial- for more aid and against Mr. Cuo- tration official who is now in the pri- But the criminal complaint filed in his executive budget, noting that ly at fault. Tort-reform advocates mo’s reforms. vate sector,pointed out the basic math by U.S. Attorney Preet Bharara’s of- his district was still recovering from now see a ray of sunlight. Mr. Silver’s legal problems could of Albany: Democrats still dominate fice suggests that Mr. Silver wasn’t the 9/11 terrorist attacks 13 years “New York has long been ‘Sue tempt the governor to seek more the 150-member Assembly. as tenant-friendly as commonly prior. The governor’s plan included York,’a trial lawyer’s playground and control of the Board of Regents, “The Assembly majority is still thought. Prosecutors obtained a seven separate tax breaks, covering a perennial judicial hellhole,” said which is heavy with Assembly ap- the Assembly majority,” he said. document prepared by an unnamed everything from energy-cost offsets Tom Stebbins, executive director of pointees and led by Merryl Tisch, a “You can’t pass a budget without the real estate group that said Mr. Silver to employee relocation. the Lawsuit Reform Alliance. friend of the speaker. Assembly majority; you can’t pass a was “considerably more favorable to Now,with Mr.Silver waylaid,his “With [Mr. Silver’s arrest], we hope “Education is the one area [that law without the Assembly majority. ability to make the case for the con- that the balance of justice in New could be affected] because of how Those things have not changed.” Ⅲ LISTEN to a discussion at tinuation of tax breaks that expire York will soon tilt back to New complex and immediate it is,” a la- CrainsNewYork.com/podcasts over the next two years will be lim- Yorkers and away from the trial- bor source said.“I think Shelly knew Additional reporting by Chris Bragg

24 | Crain’s New York Business | January 26, 2015 20150126-NEWS--0025,0026-NAT-CCI-CN_-- 1/22/2015 5:25 PM Page 1

HELLUVA TOWN INSIDE Source Lunch Concerted effort Insurance exec pins hopes for music app on Obamacare P. 26

After Fitz Holladay moved to Out and About Washington, D.C., from New Oenophiles say ‘oh yes’ York City in 2009, finding concert buddies became an unforeseen to Winter Wine Fest P. 27 challenge. The now-32-year-old started a listserv that turned into Wego Concerts, a Tinder-like free app for music lovers. The entrepreneur, who invested $165,000 in the venture, launched the app in New York earlier this month and Los Angeles in November. Wego connects users through Facebook and offers recommendations for concerts in a 150-mile radius, based on music or streaming

PLAY TIME: Kevin McCollum services on their phones. with Tyrone, the Members can customize their foul-mouthed star concert calendars, see who else is of Hand to God. going to shows, chat and meet up. Romance is an option: 65% of users have enabled the app’s dating element. “People want to connect with other people around live music, more so than other things,” Mr. Holladay said. Users can buy tickets through Wego, which gets half the service fee associated with the sale, in a partnership with SeatGeek. There are 3,400 users nationwide, including more than 1,000 New Yorkers. In the next few months, Mr. Holladay plans to launch the app in San Francisco, Miami and Austin,Texas. —jessica kramer Spa time for kids—boys, too

Milk & Cookies, opening Feb. 1 on the Upper East Side, is the latest addition to the growing kiddie- pampering sector that includes Helping hand Brooklyn spots Dimples Kids Spa and Fresh as Daisy Kids Spa and Salon. But rather than serving only Avenue Q producer Kevin McCollum is known for more than girls, Milk & Cookies’ business is “unique in that we offer salon and puppet shows. He brings newbies to Broadway spa services to both boys and girls,” said Teychenne Whitley, who

is launching the business with her buck ennis

BY THERESA AGOVINO evin McCollum swears he doesn’t have a puppet fixation, although it’s easy SETTING to understand why he might. ¶ Mr. McCollum, 52, earned a Tony Award— THE STAGE one of three—and millions of dollars producing Avenue Q, which features a cousin Jataon Whitley. group of Muppet-like creatures that would have definitely been banished The Whitleys have spent from Sesame Street.This spring on Broadway, he is presenting Hand to God,a about $300,000 to open the kids- only shop, which will offer party play about a puppet show staged at a Christian church in Texas, where a $3.5M Glitzy Glam packages. The , for foul-mouthed sock puppet named Tyrone has a habit of blurting out Production cost of girls, includes spa manicures, Hand to God pedicures and “yummy” facials. decidedly un-Christian thoughts. ¶ “I don’t have a license plate that says For boys, the Tough Cookie features ‘Geppetto One,’ ” Mr. McCollum joked. “Puppets are a way to deal with things that are politically video games and air hockey, a incorrect to say but necessary. Such things are heard more benevolently through an alter ego.” ¶ haircut and a “slimy booger” manicure. KHand to God marks the Broadway debut of playwright Robert Askins, and Mr. McCollum “This will be a one-stop shop acknowledges it’s a gamble bringing it to the Great White Way.That’s not the only chance he is for kids and a place they can finally $14M feel at home,” said Teychenne. taking this season. He is also producing Something Rotten, a musical written by a trio of Broadway Production cost of —yoona ha newbies set in Shakespearean England about two brothers’ attempts to See HELPING on Page 26 Something Rotten

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SOURCE Helping hand LUNCH: Interview by Jonathan LaMantia DEBRA FRIEDMAN Continued from Page 25 agency SpotCo, who has known Mr. create a hit when the theater world McCollum for more than 20 years. was dominated by the Bard. The “He’s not reckless. He understands show did not have an out-of-town that Broadway is a business.” tryout—a rare and risky move. Insurer hopes Obamacare’s The productions are representa- Saving money tive of Mr. McCollum’s approach. Indeed, Mr. McCollum closed He has never produced a star-driven Motown earlier this month even second year is as good as first show on Broadway and has been in- though it was making money. He volved only in a handful of revivals. realized that he could bring it back He regularly brings little-known later with new sets and save the pro- actors and writers to Broadway,which duction about $100,000 a week. It is ebra Friedman, 56, staffing on the phones and in- Many consumers opted for high- runs counter to conventional wisdom slated to return to Broadway in 2016. CEO of Health Re- creased staffing in our New York deductible plans. Is that risky? but is key to his success. For example, “I could really only do this with Mo- public Insurance of office.We have 105 employees as of All the products that we offered in he gave Casey Nicholaw his first break town since it is such a brand,”he said. New York, leads a today. As a startup when I arrived, 2014 are being offered in 2015. on Broadway as the director and cho- There have been the inevitable fi- new type of non- I was the fifth employee. None of them were high- reographer of the musical The Drowsy nancial failures along the way, includ- Dprofit insurer. One of 23 consumer deductible plans.This year we have Chaperone. Mr. Nicholaw went on to ing his revival of Ragtime. He lost all operated-and-oriented plans, or Established for-profit insurers draw a new product that is a higher- choreograph and co-direct The Book of but $1 million of the $9 million it took co-ops, created by the Affordable upon years of analytical data. How can deductible plan, just to give those Mormon and will direct Something to stage a musical version of High Fi- Care Act, Health Republic gives a startup compete? members who weren’t able to Rotten. And Mr. McCollum was delity, based on the book by Nick members a majority of seats on its We have very solid WHERE afford health care before an- working with Rent writer and com- Hornby that also became a movie star- board. national databases THEY other choice. We think the poser Jonathan Larson to bring the John Cusack. In retrospect, Mr. The Manhattan company de- and work with na- majority of members will show to the New Work- McCollum said,the show didn’t work buted last year on the state’s new in- tional consultants DINED continue to purchase our shop when he died suddenly at the age because most of the action takes place surance exchanges. Thanks to low that do all of the MADE FRESH other plans. We have anoth- of 35 in 1996. It eventually became a inside the main character’s mind, and premiums, it had by July gained a modeling on cost and DAILY er product that’s really excit- big Broadway hit. he wasn’t an especially nice person. 34% market share on the small- structure, so we have 226 Front St. ing for small businesses. “I’m not afraid to commit to “There was no one to root for,” business exchange and 19% on the as much data to un- (212) 285-2253 That’s a product with an out- madefreshdaily someone who needs a break,” said said Mr. McCollum. And High Fi- New York State of Health individ- derstand and submit bakeshop.com of-network benefit. The Mr. McCollum, who was raised by a delity didn’t share the theme of find- ual marketplace. This year, its our filings. We just market wanted that, people single mother in ing or creating a prices are 13% higher on average. don’t have the specif- AMBIENCE: were asking for it,so we filled Hawaii. His mother family, which were ic financials yet. Casual spot on a that market need. died at age 40 when ‘I’m always so crucial to the How does operating as a co-op affect cobblestone street that’s a he was 14.The father successes of shows Health Republic? Why did you raise your favorite among Will you introduce a plan for of two said the deaths looking for like Rent and Av- We don’t have stockholders who premiums by 13%? Seaport locals individuals that has an out-of- of his mother and enue Q.“I’m always require us to make quarterly profits We were the very network option? Mr. Larson were family looking for family and earnings. All of our business lowest in 2014 and WHAT THEY ATE: We thought it would be a Ⅲ Two crunchy seminal events that because I didn’t decisions are made with the mem- drove the change that chicken salads great place to start with small crystallized for him because I have one,” he said. bers’ interests strictly at heart. We the market wanted in with arugula, businesses. We can evaluate life’s fragility,the im- Hand to God believe it gives us a long-term sus- terms of lowering spinach, pecans how that goes and see where portance of testing didn’t have deals with family, tainable advantage in terms of driv- overall cost. In 2015, and cranberries else we can offer it. served in a light boundaries and the religion and com- ing a lower-cost affordable struc- even with the rate in- lemon vinaigrette need to control one’s one’ munity, though ture for New Yorkers. crease, we’re among with focaccia The New York small-business own destiny. that’s not obvious the lowest for broad from Balthazar marketplace had fewer than Mr. McCollum from the print ads, What was your strategy for challenging plan networks, and Bakery 10,000 enrollees last year. started out as an actor, which state “No national insurers in an unknown among the most af- Ⅲ Raspberry What’s ahead for 2015? market: Obamacare, year one? fordable. We’re very hibiscus herbal New York State of Health although he quickly movie stars. No iced tea, realized he didn’t want to be relegated London transfer. No film adapta- We were really focused on being a competitively priced. unsweetened has worked hard to increase to waiting for someone to deem him tion. Pray for us.” catalyst for change in New York Ⅲ Iced green tea awareness within the broker worthy for a role. He started on “I believe in leading with vulnera- and offering the most affordability How are you boosting with ginger and community, as 95% of all Broadway in 1991 as a booking agent bilities,”said Mr.McCollum.Hand to in a market that hasn’t been afford- enrollment during lime, sweetened small businesses obtain their for shows, and eventually met his for- God, which cost $3.5 million to pro- able for individuals or small busi- Obamacare’s second insurance through brokers. mer producing partner, Jeffrey Seller. duce, earned rave notices when it ran nesses. That really drove the ex- year? PRICE: $40.50, including How is your marketing strategy The duo collaborated for more than off-Broadway, yet Mr. McCollum traordinary growth in our first year. In 2015,we expanded tip 15 years before ending their partner- chose not to put reviewer quotes in our service area and different in your second year? ship in 2011, when they each realized the ad because the tactic is so typical. Has that growth led to hiring? added 11 counties upstate. That What’s exciting for 2015 is that we their desire to go out on their own. Mr. McCollum doesn’t have the We have quadrupled our staffing at enables us to reach an additional can tell our story of real savings. option of sprinkling ads for Some- the call centers, and we went from million members in those counties. Last year, in our first year on the Moving mountains thing Rotten with critics’ compli- 100 lines in 2014 to 650 lines this We’re among the most affordable market, we saved hundreds of “Kevin moves mountains to get ments because no one has seen it— year. They provide consumers the plans with the largest networks in thousands of dollars for some small things done,” said Mr. Seller. yet he was able to raise the $14 information they need about our Buffalo, Syracuse, Rochester and businesses,and this year we can talk For example, Mr. Seller said that million to stage the show. products. We also have increased Albany. about the savings. Ⅲ his former partner loved The Drowsy Mr.McCollum was introduced to Chaperone, even though its run in Something Rotten by one of its book Toronto hadn’t generated much in- writers and composers, Karey Kirk- PLAY/LIST People, places and things that make Debra Friedman tick terest among Broadway producers. patrick. The two met about 30 years Mr. Seller wasn’t enthralled, so Mr. ago, when they were working at Dis- RA ON DUTY: Ms. helping with TWO CITIES: She McCollum raised the money him- ney World, and remained friends. Friedman was a leadership lived in Forest Hills self, and brought what became a Mr. Kirkpatrick kept mentioning resident assistant as development, and it until her family Tony-winning hit to Broadway in that he was working on a musical an undergraduate at paid for about half moved to the reasonably short time of 18 with his brother Wayne. Eventually, the University of her college costs. Philadelphia when months. “Kevin has really good in- Mr. McCollum heard some songs Maryland-College she was 14. She stincts,” said Mr. Seller. and decided to produce the show. Park, where she met POLITICAL returned to New York His sixth sense for spotting a hit “I was really lucky that he was will- her husband, DRAMAS: Some of bloomberg news about 30 years ago. has led to a cadre of investors who ing to take the chance,” said Karey walks across the beautiful view.” bankroll his productions. However, Kirkpatrick. He was struck by Mr. Howard. She credits her favorite TV shows “In my heart, I think I Brooklyn Bridge from in the beginning he was using earn- McCollum’s willingness to hear sug- the experience for are The West Wing, have the guts, grit her apartment in THEATER BUFF: She ings from his booking company, as gestions about the noncreative aspects Scandal and sensibilities of a well as investments from family and about the play, such as advertising, and House Brooklyn Heights to recently enjoyed New Yorker.” friends, to stage his shows. even though Karey and his partners of Cards. Health Republic’s Beautiful, the “Kevin has a way of making the had no Broadway experience. office at 30 Broad St. Broadway musical mass audience come to him without “He is very respectful. He makes MORNING “It’s a time for about the early life catering to the mass audience,” said everyone feel that they are part of the RUSH: Ms. reflection and and career of Carole Ⅲ Tom Greenwald, co-founder of ad team,” said Mr. Kirkpatrick. Friedman planning and such a King. bloomberg news

26 | Crain’s New York Business | January 26, 2015 20150126-NEWS--0027-NAT-CCI-CN_-- 1/22/2015 6:42 PM Page 1

OUT AND SNAPS REBNY honors real estate’s heavy hitters ABOUT by Jessica Kramer

CULTURE FIX CAREER BUILDER THURSDAY, FEBRUARY 5, WEDNESDAY, FEBRUARY 4 THROUGH SUNDAY, FEBRUARY 8 Those looking to run a business in the The ATHENA FILM FESTIVAL celebrates food industry can go to Edible women as filmmakers and strong Brooklyn’s SELL IT LIKE IT IS and hear characters on the screen. The festival will from a panel of experts on the topic, show feature films, documentaries and including representatives from Farm shorts including indie favorites Obvious to People, Astoria Distilling Co. and Child and Dear White People, plus opening- Good Eggs, as well as a trademark and night film Dreamcatcher, which chronicles a business law attorney.The former Chicago prostitute who helps conversation and Q&A take place at 8 women and teenage girls avoid abuse. p.m. at Brooklyn Brewery at 79 N. 11th St. Tickets are $5 and can be buck ennis There are also talks with directors, marion curtis/starpix. producers and actors, including purchased at ediblebrooklyn.com. CARL GOODMAN, JULIANNE MOORE and MICHAEL BARKER at MITCHELL MOSS, MARY ANN TIGHE, ROB SPEYER, ANGELA SUNG choreographer Twyla Tharp. Times and the Museum of the Moving Image’s 29th Annual Black-Tie Salute. PINSKY and MICHELLE ADAMS at the Real Estate Board of New York’s prices vary for the screenings. They take FRIDAY, FEBRUARY 6, The Jan. 20 event honored Julianne Moore for her award-winning 119th Annual Banquet. The Jan. 15 gala recognized six influential leaders in place mostly at Barnard College, 3009 AND SATURDAY, FEBRUARY 7 body of work. real estate at the industry’s biggest event of the year. Broadway. For more information, visit The New School’s Sustainable Cities athenafilmfestival.com. Club presents CHOICES: HOW EVERYDAY DECISIONS CAN MAKE A LASTING SATURDAY, FEBRUARY 7 IMPACT for those seeking Soul maestro D’ANGELO environmentally friendly business came back after a nearly strategies in New York City.The event 15-year hiatus in kicks off with a keynote address on the December with his third intersection of sustainability and social album, Black Messiah.For justice in New York City on Friday his first U.S. engagement evening from 6 p.m. to 7:30 p.m. since the release of the apollo theater Saturday has a full day of album, he returns to the Apollo for what’s programming from 11 a.m. to 5 p.m. sure to be a warm welcome. His first and ends with a social networking appearance there was in 1991 as an reception at 5:30 p.m., all at the Amateur Night contestant. The show takes Theresa Lang Community Center at place at 8 p.m. at the Apollo Theater, 253 55 W. 13th St. Tickets are free, but W. 125th St. Tickets are $56 to $126 and interested attendees should RSVP can be purchased at apollotheater.org. online at events.newschool.edu. margot jordan photo exclusively for bae for exclusively photo margot jordan

DAVID DINKINS, JENNIFER JONES AUSTIN and LOWELL HAWTHORNE at kevin j. mccormick the Black Agency Executives’ 2015 Dr. Martin Luther King Jr. Luncheon. The ALICE GREENWALD and ANTHONY NAPOLI at the 2015 June DON’T MISS WINTER VINTNERS Jan. 14 benefit raised $123,000 for African-American nonprofit execs’ Briggs Awards. The Jan. 12 fete honored New York City companies SATURDAY, FEBRUARY 7 professional development. in the destination-management/hospitality industry. The NYC WINTER WINE FESTIVAL returns for its sixth year of oenophilia. The two sessions consist of three hours of sampling See more of this week’s Snaps online at CrainsNewYork.com/galleries. more than 250 wines, a selection of hors d’oeuvres and live jazz. The first session is from 3 p.m. to 6 p.m., and the second is from 8 p.m. to 11 p.m., at the Best Buy Theater, 1515 Broadway. General- admission tickets are $79 and can be

purchased at newyorkwineevents.com. wine events york balsamo/new timothy

OPENING FUNDRAISERS TUESDAY, FEBRUARY 3, WEDNESDAY, FEBRUARY 4 NOW AVAILABLE THROUGH TUESDAY, FEBRUARY 17 Step up to bat at Citi Field for Autism New York Festival of Song presents Speaks, an autism advocacy organization the fifth year of its contemporary- hosting the fundraiser BATTER UP FOR A THE music series, NYFOS NEXT. For three CAUSE. Visitors can enjoy batting Tuesdays in a row, different practice, a ballpark tour, light composers act as curators of the refreshments and Mr. Met. Attendees can festival, showcasing their work and choose an hourlong session from 5 p.m. to those of colleagues. For opening 9 p.m. at the stadium, located at 123-01 night, the program includes excerpts Roosevelt Ave., Flushing, Queens. 2015 from Three Vernacular Songs by Tickets are $99 and can be purchased at Gabriel Kahane (pictured) and newyork.mets.mlb.com. excerpts from new musicals by Adam Guettel and George Steel. The SATURDAY, FEBRUARY 7 concerts take place at 7 p.m. at Opera “Put the hilarity in charity” with CUPID’S America’s National Opera Center, UNDIE RUN, a race in one’s skivvies for the BOOK 330 Seventh Ave. Tickets are $15 and Children’s Tumor Foundation. The one- can be purchased at nyfos.org/next. mile dash along the Hudson River Greenway and around Pier 84 is preceded by an indoor awards ceremony. Participants can party before and after the run. The festivities begin at noon at Stage OF 48, 605 W. 48th St. Tickets are $45 to $55 and can be purchased at cupidsundierun.com. jacob blickenstaff jacob MARK YOUR CALENDAR… LISTS

WEDNESDAY, MAY 20 BUFFY SAINTE-MARIE steps into the limelight, right up Purchase the Print or Excel edition at: where she belongs. The Native American folk singer and activist, who has been performing for 50 years, brings roden barry CrainsNewYork.com/DataCenter her powerful stage presence to the Highline Ballroom, 431 W. 16th St. The show starts at 7:30 p.m. Tickets are $28 to $55 and can be purchased at highlineballroom.com.

January 26, 2015 | Crain’s New York Business | 27 to our business banking THANK YOU customers for inspiring us.

In 2014, J.D. Power ranked Chase “Highest in Customer Satisfaction with Small Business Banking in the Northeast Region.”

Chase received the highest numerical score in the northeast region in the proprietary J.D. Power 2014 Small Business Banking Satisfaction Study.SM Study based on 8,996 total responses, measuring 10 financial institutions in the northeast region (CT, ME, MA, NH, NJ, NY, PA, RI, VT) and measures opinions of small business customers with annual revenues from $100,000 to $10 million. Proprietary study results are based on experiences and perceptions of customers surveyed in July–September 2014. Your experiences may vary. Visit jdpower.com JPMorgan Chase Bank, N.A. Member FDIC © 2015 JPMorgan Chase & Co.