CRAINSNEW YORK BUSINESS
NEW YORK BUSINESS® NOVEMBER 26 - DECEMBER 2, 2018 | PRICE $3.00
THE STATE OF INEQUALITY Outreach workers such as Stephania Ponce connect New Yorkers to the city’s social safety net, which our special report shows is the most robust in the nation PAGE 11
VOL. XXXIV, NO. 48 WWW.CRAINSNEWYORK.COM THE VAST Getting DEBATING AND prices THE FATE LUCRATIVE right at OF NYC’S WORLD AGING OF STATE NYP MOVIE SUBSIDIES P. 4 PALACES NEWSPAPER P. 6 P. 15
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ON THE COVER
PHOTO: BUCK ENNIS
FROM THE NEWSROOM | GREG DAVID | COLUMNIST Balancing act
EVER SINCE THE Occupy Wall Street movement grabbed worldwide attention in 2011, the issue of inequality has nev- er been far from the spotlight, especially in New York City. But how inequality actu- ally plays out in society is not just about the chasm between the richest and the rest but about how governments respond to that gap—espe- cially at the state and local levels. To probe that issue, the Ravitch Fiscal Reporting Program I run at the CUNY Newmark School of Journalism funded e orts at KUOW in Seattle, WABE in Atlanta, Austin’s Texas Tribune and Crain’s New York Business to research the safety nets and tax policies in those areas. P. Here, Cara Eisenpress and I amassed the details of how the city seeks 15 to protect its neediest residents, and we came to understand why our safety net is the most robust in the country. IN THIS ISSUE I also came away from the project with a stark realization of how UP FRONT 15 THEATER WARS policies in states such as Georgia, Texas and Washington make the City’s aging movie palaces now lives of the poor more di cult in exchange for easing the burden on 3 EDITORIAL neighborhood battlegrounds the rich. Politicians in those states argue that low taxes and miserly Moral of mayor’s Nycha plan: 20 GOTHAM GIGS social services are key to their economic success. at claim was chal- Good results are good politics Parkour athlete builds lenged in the governors races in Georgia and Texas, but the voters, if 4 IN CASE YOU MISSED IT business by ipping over only by a slim majority, opted for leaders committed to the status quo. City Council shines light obstacles New York is the complete opposite. e blue wave that swept the on hospital price disparities state this month means the debate next year will be about expanding 5 IN THE MARKETS Adviser to New York’s rst our safety net and taxing the wealthy more heavily to pay for it. is family of tax evasion gets story is crucial to understanding exactly what the outcome of that prison; KKR, Bain Capital help debate will mean for all New Yorkers. Toys R Us ex-staffers 6 INSTANT EXPERT The vast and lucrative world of state subsidies 7 REAL ESTATE CONFERENCE CALLOUT Long Island City bracing NEXT WEEK for Amazon impact CRAIN’S 2018 BUSINESS 8 SPOTLIGHT BREAKFAST FORUM Going beyond the niche at a kosher steakhouse P. Andy Byford will discuss his plan 20 to x the subways and buses and 10 VIEWPOINTS 21 SNAPS his ideas for reforming the culture City falling behind as others Photos from the city’s biggest embrace the cloud; put transit ANDY BYFORD, of New York City Transit. fundraisers and charity events president, New upgrades on Amazon wish list York City Transit 22 FOR THE RECORD Our tally of the week’s buys, NEW YORK FEATURES busts and breakthroughs ATHLETIC CLUB CASTING A WIDE NET PHOTO FINISH 8 to 9:30 a.m. 11 23 CrainsNewYork.com/ City’s safety net made possible Rockefeller Center spruce rises events-BKByford2018 by the inequality it targets amid Christmas tree shortage
Vol. XXXIV, No. 48, Nov. 26, 2018—Crain’s New York Business (ISSN 8756-789X) is published weekly, except for double issues Jan. 1, June 25, July 9, July 23, Aug. 6, Aug. 20 and Dec. 24, by Crain Communications Inc., 685 Third Ave., New York, NY 10017. Periodicals postage paid at New York, NY, and additional mailing of ces. Postmaster: Send address changes to: Crain’s New York Business, Circulation Department, PO Box 433279, Palm Coast, FL 32143-9681. For subscriber service: Call 877-824-9379. Fax 313-446-6777. $3.00 a copy, $99.95 one year, $179.95 two years. (GST No. 13676-0444-RT) ©Entire
BUCK ENNIS, GETTY IMAGES contents copyright 2018 by Crain Communications Inc. All rights reserved.
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AGENDAMoral of the mayor’s Nycha plan: A HOUSING COMPLEX Good results are good politics in the Bronx that was renovated by a private developer under a new he reaction of some tenants and their advocates ranged from program skepticism to outrage when, in one of the city’s largest hous- ing deals of 2014, the New York City Housing Authority sold a stake in hundreds of deteriorated apartments to private Tinterests. e deal, begun by the Bloomberg administration, was done quietly, raising suspicions that greedy developers would pro t o low- income tenants and eventually push them out. A handful of elected o cials all but accused the city of a cover-up, and activists began hectoring the then-chairwoman of the Housing Authority. “Don’t privatize Nycha!” they chanted outside her events. But two years a er the transaction, when a Crain’s reporter visited one of the apartment complexes involved, she found happy tenants. ey beamed about their shiny new washing machines, manicured grounds and bright entrance- ways, and about the service of the private management company. Nycha that run up costs and delays. ey have more incentive than government retained an ownership stake to ensure that the properties stay a ordable. bureaucrats because they have to meet the terms of their contracts to get ese developments now have a solid future—unlike the rest of the sys- paid and remain in good standing to win more of them. tem, which has long been underfunded, poorly managed and falling apart. Even critics of the pilot program blessed the mayor’s $13 billion expan- If something sounds too good to be true, sion, or at least did not object. e former it usually is. But the project worked out so A test project worked so well that naysayers also are coming to grips with his well that Mayor Bill de Blasio announced plan to allow some private development on last week that by 2028 an additional 62,000 last week the mayor announced a authority land. at will not only provide of the authority’s 176,000 units would get $13 billion, 62,000-unit expansion units the city sorely needs but also funding new kitchens, bathrooms, windows, eleva- for the two-thirds of authority properties tors, boilers, roofs and common areas using not getting RAD, which is limited by the a similar arrangement. e program, called RAD, works by replacing a number of federal vouchers available. Unfortunately, piecemeal repairs development’s insu cient and unpredictable funding stream with reliable only will prolong the su ering; there is no sustainable solution for those Section 8 assistance, allowing a private entity to upgrade and manage the buildings. For the sake of their residents, the mayor should again put properties pro tably. Developers can do this far more economically and ef- results before ideology and open more Nycha land for mixed-income, ciently than Nycha can, in part because they are not burdened by unions mixed-use development where they could live with dignity. — THE EDITORS
FINE PRINT New Yorkers stretched by city rents may feel as if they are between a rock and a hard place. According to a StreetEasy and YouGov survey of 2,550 tenants, 59% have considered moving in the past 12 months because of a rent increase. Among those who felt that way yet chose to stay, 47% believed relocating would be too expensive.
BY GERALD SCHIFMAN STATS
25 WORDS OR LESS AHEAD OF SCHEDULE THE CITY'S FAIR WORKWEEK LAW aims to deter employers from changing workers’ hours at the last minute and similar practices. In its rst year, few businesses were punished. AND THE CITY
The letter reveals a Number of fast-food and retail “pattern of interference 300K workers covered by the law with DOI investiga- Total employees paid restitution—$146 per person, tions and intimidation 1,200 on average—under the law against of cials that Number of Fair Workweek complaints Number of staffers in the unit should be unlawful” to reach the Department of Consumer handling Fair Workweek cases 120 Affairs, leading to 80 investigations 42 —Councilman Ritchie Torres on claims by red Department of Investigation Restitution paid by the owner-operator of 30 city Kentucky Fried Chicken outposts after the employer did not set a regular schedule, violated the paid- Commissioner Mark Peters that mayoral $80K sick-leave law and required workers to sign a document waiving premium pay aides requested probes be dropped
SOURCE: Department of Consumer Affairs GETTY IMAGES, BUCK ENNIS
NOVEMBER 26, 2018 | CRAIN’S NEW YORK BUSINESS | 3
P003_CN_20181126.indd 3 11/21/18 5:15 PM IN CASE YOU MISSED IT CRAINSNEW YORK BUSINESS president K.C. Crain senior executive vice president Chris Crain group publisher Mary Kramer
EDITORIAL managing editor Brendan O’Connor Insurer, union, health system NEW YORK- PRESBYTERIAN’S assistant managing editors Erik Engquist, in showdown over high prices Forese said Jeanhee Kim, Robin D. Schatz patients are copy desk chief Telisha Bryan ONTRACT NEGOTIATIONS “caught in the art director Carolyn McClain between Empire BlueCross middle.” photographer Buck Ennis BlueShield and New York-Presbyterian spilled into digital editor Gabriella Iannetta public view last week as the system’s high prices were data editor Gerald Schifman C senior reporters Joe Anuta, Aaron Elstein, scrutinized at a City Council hearing. Matthew Flamm, Daniel Geiger If NYP and the insurer don’t reach a deal before their con- reporters Will Bredderman, Jennifer Henderson, Jonathan LaMantia tract expires Dec. 31, the health system estimates 300,000 digital fellow Lizeth Beltran people in employer-sponsored, individual, Medicare and columnist Greg David Medicaid plans would face higher out-of-network charges at contributors Tom Acitelli, Cara Eisenpress, Cheryl S. Grant, Yoona Ha, Chris Kobiella, its physician groups—including Weill Cornell Medicine and Miriam Kreinin Souccar Columbia Doctors—and 10 hospitals. to contact the newsroom: www.crainsnewyork.com/staff NYP stands to lose a major source of patients, while Empire 212.210.0100 is faced with selling policies without U.S. News’ top-rated New 685 Third Ave., New York, NY 10017-4024 York hospital in its network. ADVERTISING Also involved is 32BJ, one of the city’s most politically ac- www.crainsnewyork.com/advertise advertising director Irene Bar-Am, tive unions, whose membership includes cleaners, doormen and security guards. It uses Empire to build its net- 212.210.0133, [email protected] work and has complained to NYP about its prices. For 13 hip replacements, the union paid the health system senior account managers Lauren Black, Rob Pierce, Stuart Smilowitz nearly $83,000 on average, more than $25,000 above what other city facilities charged. For vaginal deliveries, the account manager Jameson Roberts union paid nearly $24,000—about $7,000 more than its average at other city hospitals. integrated marketing manager Jonathan Yan, 212.210.0290, [email protected] Big reductions are needed to put NYP in line with other facilities, said Sara Rothstein, director of the 32BJ associate art director/marketing Health Fund, which covers nearly 200,000 people in 11 states. “In the best of all possible scenarios, NYP would Charles Fontanilla, 212.210.0145 [email protected] cut its prices by 30%,” Rothstein said at the hearing. “ at is what we think it would take to make it competitive.” sales coordinator Devin Arroyo, e health system said Empire, a subsidiary of Indianapolis-based Anthem, is threatening to cut $200 million in 212.210.0701, [email protected] payments. “It has been, to us, what appears to be negotiating to terminate,” said Dr. Laura Forese, NYP’s executive CUSTOM CONTENT director of custom content vice president and chief operating ocer. “ at’s not where New York-Presbyterian wants to be, and our patients Patty Oppenheimer, 212.210.0711, are caught in the middle.” — JONATHAN LAMANTIA [email protected] custom project manager Danielle Brody, [email protected] EVENTS Much-needed xes DATA POINT in Williamsburg, moved to Bayonne, www.crainsnewyork.com/events e New York City Housing Author- N.J., nearly two decades ago. director of conferences & events GOV. ANDREW CUOMO PARTNERED ity will repair 62,000 apartments by Courtney Williams, 212.210.0257, [email protected] 2028, Mayor Bill de Blasio announced. WITH GRISTEDES, WALMART, Generous gift manager of conferences & events e $13 billion project, nanced from WEGMANS AND THE NATIONAL Former Mayor Michael Bloomberg Ashlee Schuppius, public-private partnerships, will install donated $1.8 billion to his alma mater, [email protected] SUPERMARKET ASSOCIATION TO new kitchens, bathrooms, elevators, Baltimore-based Johns Hopkins Uni- AUDIENCE DEVELOPMENT boilers and more. e refurbished units PROVIDE THANKSGIVING TURKEYS TO versity. e gi , aimed at providing group director, audience development will remain permanently a ordable, nancial aid to high-achieving appli- Jennifer Mosley, [email protected] MORE THAN 40,000 NEW YORKERS. and the 142,000 residents will retain cants from lower-income families, is REPRINTS their rights as public-housing tenants. the largest single contribution to a pri- reprint account executive Lauren Melesio, vate university, according to e Chron- 212.210.0707 Big opening Dallas. In 21 years Frankel produced icle of Higher Education. Bloomberg PRODUCTION ree years a er closing its famed Fi h 53 musicals and plays, including Spring has given $1.5 billion to the university production and pre-press director Avenue agship, FAO Schwarz opened Awakening and revivals of Hair and throughout the years. Simone Pryce a store at nearby 30 Rockefeller Plaza. Fiddler on the Roof. — GERALD SCHIFMAN media services manager Nicole Spell e new shop brings back such familiar SUBSCRIPTION CUSTOMER SERVICE features as the giant oor piano and has Needing a new crew member www.crainsnewyork.com/subscribe added experiential attractions, includ- J.Crew CEO James Brett le his post af- [email protected] ing an area where employees dressed as ter only 16 months. Even as sales have 877.824.9379 (in the U.S. and Canada). $3.00 a copy for the print edition; or $99.95 mechanics assemble cars designed by risen at the retailer, Brett and company one year, $179.95 two years, for print customers. higher-ups butted heads about ways to subscriptions with digital access. further grow the company. Entire contents ©copyright 2018 Getting with modern times Crain Communications Inc. All rights e Museum of Modern Art extended Lefty in blue reserved. ©CityBusiness is a registered the contract of director Glenn D. Low- e Yankees made the rst big splash trademark of MCP Inc., used under license ry by seven years, to run through 2025. of Major League Baseball’s o season, agreement. Lowry will become the longest-serving acquiring starting pitcher James Paxton CRAIN COMMUNICATIONS INC. director in MoMA’s history, bucking in a trade with the Seattle Mariners. e chairman Keith E. Crain the museum’s longstanding policy of Bombers gave up three minor leaguers vice chairman Mary Kay Crain president K.C. Crain asking senior sta to retire at or near for the talented 6-foot-4 southpaw, Glossy no more Glamour has announced it will senior executive vice president Chris Crain age 65. who has dealt with a spate of injuries secretary Lexie Crain Armstrong end its regular print issue. throughout his six-year MLB career. editor-in-chief emeritus Rance Crain Great second act Editor-in-Chief Samantha Barry chief nancial of cer Robert Recchia plans to focus on the brand’s grow- Jerry Frankel, a Broadway producer Sweet anniversary founder G.D. Crain Jr. [1885-1973] who won nine Tony Awards, died last Kedem, a kosher wine, spirits and ing digital audience. Since January chairman Mrs. G.D. Crain Jr. [1911-1996] week at 88. e Queens native began grape juice brand from Royal Wine the site has seen a 12% increase his production work in 1997 a er sell- Corp., celebrated its 70th anniversary in monthly unique visitors.
BUCK ENNIS ing a dress-manufacturing business in last week. e vintner, formerly based
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P004_CN_20181126.indd 4 11/21/18 6:00 PM IN THE MARKETS
Prison awaits adviser to New York’s first family of tax evasion But 2017 reforms may give rise to new age of cheating
he lawyer who schooled a taxes by parking money o shore. But a but the latest gures show the gap had ed guilty to crimes from 2001 to 2009 prominent New York fam- new golden age of tax evasion may be grown to more than $400 billion by and await sentencing. ily in the tricks of the tax- dawning, thanks to last year’s tax law, 2010. e voluntary compliance rate Little, a British national, is a former evasion trade is headed for which incentivizes business owners to with tax law was 81.7% in 2010, down Royal Marine who shuttled for years Tthe slammer. use a favorite tool of tax cheats. from 83.7% in 2001, which between London and New Last week a federal judge sentenced e law created a deduction of 20% means nearly 1 in 5 taxpayers York. Starting in the 1970s, Michael Little, 68, to 20 months in pris- of net income for many owners of pass- cheats. Budget cuts in the past he was a Wall Street trader on for his role in helping a Wall Street through entities, e ectively lowering decade have reduced the abil- at such places as Irving Trust executive’s adult children tap into Swiss their top tax rate to 29.6% from 37%. ity of the IRS to catch them. and Dillon Read before run- bank accounts, which held millions in Pass-throughs include partnerships, Little’s trial in federal court ning his own brokerage rm, inheritance money, without alerting the limited-liability companies and sole in Manhattan examined how Ariel Ltd., of which Harry IRS. proprietorships whose pro ts are taxed four children of former Fideli- Seggerman was a client. In “You told a whopper of a lie,” Judge as personal income for their owners. ty money manager Harry Seg- 2001 Little le nance to at- P. Kevin Castel growled Nearly 95% of businesses are german used pass-throughs AARON ELSTEIN tend law school in the Unit- from the bench, waving structured this way. and other techniques to avoid ed Kingdom. He acted as his his nger and describing They But the underreport- taxes on their $24 million in- own attorney during the trial. the scheme Little took part “ ing of income from pass- heritance. For instance, the heirs took In April a jury convicted him on all in as “clever but not clever want me through businesses accounts cash from Switzerland by funneling it 19 counts of his indictment. Before sen- enough.” e judge also to die in for more than 40% of all tax- through an inactive lm-production tencing, Little, who su ered a heart at- ruled that Little had lied es evaded, according to the company controlled by their mother. tack in July and underwent angioplasty, from the witness stand. prison” Brookings Institution. As e children said Little advised them vowed to appeal the verdict. e resolution pass-throughs have grown to take money out of Europe in “little “ ey want me to die in prison,” he of the case marks more popular, tax evasion chunks” and to disguise money trans- said, referring to prosecutors. the end of a decadelong also has become more common. e fers by claiming they were related to the Given the precarious state of his government crackdown against wealthy IRS reckons it collected about $300 sale of art or jewelry. Seggerman’s heirs, health, that grim possibility can’t be families and their advisers who evaded billion less than it was owed in 2001, who range in age from 54 to 65, plead- ruled out. He is to surrender Feb. 19. ■
KKR and Bain Capital contribute $20M to help Toys R Us workers Other investors urged to aid 33,000 ex-employees
n an apparent rst, two eraged buyout, kicking in $1.3 billion in private-equity owners of Toys R cash and borrowing the rest. e he y Us are committing $20 million to debt burden crushed the retailer. In June help many of the failed retailer’s it closed all its stores, and the chain was I33,000 former employees. liquidated. KKR, Bain and Vornado’s “Bain Capital and KKR did the right cash investment in Toys R Us was wiped thing, and it’s very exciting news,” said out, but the rms collected $470 million Deb Mizen, a former assistant manager in fees before the toy seller’s collapse, at a Babies R Us in Boardman, Ohio. according to Bloomberg News. at Labor organizers hope the TRU Fi- helped so en the blow. nancial Assistance Fund will serve as a model for owners of other troubled Not according to plan retailers, such as Eddie Lampert’s Sears KKR and Bain said no client money Holdings. was put into the assistance fund. In a “ ere is certainly a lot of carnage statement they said they regretted the in retail,” said Cary Gleason, campaign demise of Toys R Us, citing “the push” manager for Rise Up Retail. by secured creditors to liquidate and KKR and Bain committed $10 mil- adding they advocated “for a very dif- lion each to the fund. e money will ferent outcome than what occurred.” be allocated by Kenneth Feinberg and “ is is a unique set of circumstanc- Camille Biros. Both oversaw the 9/11 es that called for a unique solution, Fund and the BP Oil Spill Fund. and we hope others will consider join- Eligible employees must have ing and contributing to the fund,” the worked at Toys R Us for at least a TOY SHOPPERS have fewer brick-and-mortar options after Toys R Us closed all of its private-equity rms said. year and earned between $5,000 and more than 800 stores and liquidated in June. Mizen, who worked at Toys R Us for $110,000. Distributions are expected to 31 years, said she hoped nancial assis- begin shortly a er Dec. 15 and end by tance would come quickly because she late April. Asset Management and Vornado Real- in attempting to resolve this issue by hadn’t been able to nd work. e fund has enough to distribute ty Trust, to contribute. contributing some nancial relief to “I had to sit down with one of my an average of about $600 per employee, Last month Sen. Elizabeth Warren the employees who lost their jobs, your eight grandchildren and say, ‘San- but labor advocates hope it will grow wrote a letter asking holdouts to help. companies have refused to do so. I urge ta won’t bring as much this year, and to $75 million and have pressed other “While other companies that played you to reconsider,” she wrote. neither can grandma because grand- investors in Toys R Us, including An- a role in this liquidation—KKR and KKR, Bain and Vornado acquired ma doesn’t have a job,’’’ she said. “ at
gelo Gordon & Co., Solus Alternative Bain Capital—have shown leadership Toys R Us for $7.5 billion in a 2005 lev- breaks your heart.” — A.E. BUCK ENNIS
NOVEMBER 26, 2018 | CRAIN’S NEW YORK BUSINESS | 5
P005_CN_20181126.indd 5 11/21/18 5:45 PM INSTANT EXPERT
The vast and lucrative world of state subsidies BY WILL BREDDERMAN
THE ISSUE THE PLAYERS Amazon’s plan to open a headquar- The Excelsior Jobs Program, which ac- ters in Long Island City, which could counts for more than 70% of the state’s 1net the company $1.7 billion in state 2 offering to Amazon, dates back to Gov. grants and tax credits—plus $1.3 billion Andrew Cuomo’s predecessor, David Paterson. in as-of-right perks from the city—has The credits, which are geared toward attracting reignited an argument about the spate jobs, will offset the company’s capital invest- of lucrative subsidies Albany doles out to ments and payroll taxes. private companies. The deal was ripped on Luring rms—particularly in the tech and the left—by Queens Rep.-elect Alexandria entertainment elds—has been a core part of Ocasio-Cortez —and the right—on The Wall Cuomo’s economic-development agenda. His Street Journal editorial page—as a need- Start-Up NY program spent $53 million in advertising in 2014 to attract out-of-state less giveaway to the online-shopping giant, entrepreneurs to properties owned by the state university system in exchange for a which is worth nearly $1 trillion, and its tax-free decade. At the heart of his agship Buffalo Billion program was a $750 million owner, the world’s richest man, Jeff Bezos. solar-panel factory the state built for Elon Musk’s SolarCity. The administration paid an Others noted that Virginia offered Amazon additional $15 million to construct the Central New York Hub for Emerging Nano Indus- far less ($573 million) to locate the other tries near Syracuse for the startup Filmhouse, promising 350 permanent jobs. half of its coveted HQ2 in Crystal City. And Cuomo also has created 10 Regional Economic Development Councils—boards some wondered why it would need any of his appointees formed under the umbrella of Empire State Development—that nancial inducement at all to set up shop propose local projects for possible state funding. Cuomo has given away $5.4 billion in New York City and the D.C. area. through this program, while the New York Power Authority, which the governor also controls, gives away hundreds of millions annually in discounted electricity.
Companies generally base YEAH, BUT... relocation Start-Up NY’s efforts yielded a mere 72 jobs in its rst decisions on year, and the program has been scarcely more productive 3 since then. The much-hyped Syracuse movie studio gen- quality education, erated little more than construction work, and the state sold transportation it for $1 earlier this year. The SolarCity plant (right) employs roughly half as many workers as Cuomo promised. The cut- and the available rate electricity from the Power Authority ows not just to struggling factories, but also to cash- ush workforce, not and politically connected hospitals and universities. Meanwhile, reports have found the regional council program suffers from poor oversight and lacks clear metrics for assessing success. government More troubling is the cloud of corruption that now surrounds these programs. Juries convicted handouts the governor’s economic-development point man, Alain Kaloyeros, and top executives from the rms that developed the factory and movie studio on bid-rigging charges. The executives who were found guilty were major donors to Cuomo’s campaign. WHAT’S NEXT
Most economists agree that tax credits and subsidies 5provide few direct bene ts to SOME BACKSTORY either state or national econo- Incentive programs such as Start-Up New York are nothing new. Gov. George Pataki’s Empire mies. Evidence suggests compa- Zone program was little more than an update of Gov. Mario Cuomo’s Economic Development nies base relocation and expan- Zones. The program was intended to attract companies to depressed areas of the state by re- sion decisions on the quality of 4 ducing taxes for hiring and construction, but the budget ballooned 2,000% between 2000 and 2008. local education systems, trans- Businesses that participated consistently failed to hit job-creation benchmarks, and by the end of portation, the available workforce the decade, it was universally deemed a failure. In 2017 central New York news site syracuse.com and the opportunity for market determined that the expired incentives had cost the state $3 billion in lost tax revenue, and bene ting share, not government hand- companies still held $1.5 billion in unredeemed credits. outs. While some states have Pataki also established the state’s lm and TV tax dropped lm tax credits, none credit program, a $25 million initiative at the outset have stopped offering incentives that has swollen to $420 million per year under Cuomo. to snatch businesses from their Critics contend it bene ts productions that would have neighbors. Short of a federal ban, lmed in New York anyway, but the industry has explod- interstate bidding wars like the ed along with the program, leading to thousands of jobs one for HQ2 are sure to continue. and millions in economic activity, which, according to industry insiders, would all but disappear without it. GOVERNOR ANDREW CUOMO FLICKR, ISTOCK, SOLARCITY
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P006_CN_20181126.indd 6 11/21/18 4:53 PM REAL ESTATE
Long Island City braces for impact Plans for increasing school, sewer and transit capacity were in the works before Amazon announcement BY WILL BREDDERMAN AMAZON mazon is about to from the pot will go toward projected enrollment will workers ood into Long Is- water main and sewer im- rise. Two new K-5 buildings will add to land City—but can provements, allowing the De- are to open in the area for the the already busy transit the former indus- partment of Environmental 2021-22 school year to accom- system. Atrial enclave handle the new Preservation to rebuild aging modate 1,184 students, and arrival? and atrophied sewer pipes, Amazon has agreed to build a e neighborhood’s popu- construct new anti- ood bulk- 600-seat middle school on or But experts note this will allow volume at that time. lation and workforce were on heads along the Newtown near its campus. for only two additional trains e MTA already aimed to the rise well before the Seat- Creek and replace the pipes But the bigger concern is on the line during the busiest increase capacity on the G by tle-based e-tailer announced that divert runo during ex- the potential impact the new hours of the day, adding 2,500 running longer and more fre- plans to build o ces and bring treme storms. headquarters will have on passengers to its capacity. quent trains to accommodate 25,000 to 40,000 jobs there. mass transit. e line also faces pressure those inconvenienced by the But several city agencies as- Getting to schools Some Amazon workers will on its western end from the severing of the L link to Man- sured Crain’s they have already A recent Department of doubtless commute to Queens Hudson Yards development. hattan, an upgrade that will begun shoring up the neigh- Education report found that from Manhattan, traveling e E and F coming out of now become a priority. borhood’s infrastructure to elementary schools in Com- against rush-hour tra c, but Jackson Heights were at 95% Plus, as part of its deal with comfortably absorb the added munity Education Council many others may choose to capacity in 2014, although the city, Amazon agreed that impact. 30, which covers Long Island live in parts of Brooklyn and the F train into Queens from half the property taxes on the On Oct. 30, just weeks be- City and adjacent neighbor- Queens. Manhattan was at just 70%. publicly owned sites it will oc- fore the company’s decision hoods, are almost universally e neighborhood’s pri- e northbound G, which cupy will ow directly into an was made public, the city an- over capacity—some by more mary connection to Midtown, connects Long Island City infrastructure fund. nounced a $180 million Long than 40%. Its middle schools, the 7 train, is to undergo sig- to trendy neighborhoods in But Crain’s found this likely Island City Investment Strat- meanwhile, are somewhat un- nal modernization this year, Brooklyn, was operating at less will reap just $1 million annu-
egy. More than half the funds derused, although the study allowing for greater e ciency. than two-thirds its maximum ally in the rst decade. ■ BUCK ENNIS
NOVEMBER 26, 2018 | CRAIN’S NEW YORK BUSINESS | 7
P007_CN_20181126.indd 7 11/21/18 5:46 PM SPOTLIGHT RESTAURANTS
Going beyond the niche at a kosher steakhouse Reserve Cut puts quality rst to attract a diverse clientele BY CARA EISENPRESS
hen the American-raised wagyu rib eyes have been aged for 36 days and the béarnaise sauce is enriched with bone mar- row, no one misses the butter—at least not at Reserve Cut, a ve-year-old kosher steakhouse near the New York Stock Exchange. W e high-end fare brings in a crowd of tourists and employees, but not all din- ers fall into owner Albert Allaham’s original target demographic: kosher-keeping Financial District workers looking to impress clients. “Before Reserve Cut, a group of 10 businesspeople with one who’s kosher would go to a nonkosher restaurant,” he said. “Now they come in here, and then they want to come back again for a date.” Historically, kosher restaurants were clustered in neighborhoods with high populations of Orthodox and Hasidic businesses, but few earned a strong enough reputation to entice New Yorkers not limited by dietary restrictions. e added expense of maintaining a kosher kitchen, along with the need to close nearly one- third of the year for holidays and Shabbat, strangled culinary creativity. But as more well-o , kosher-keeping Jews have sought quality dining options beyond business meetings, the number of kosher restaurants locally has begun to grow. ere are now 329 restaurants that self-report their cuisine as Jewish-kosher in New York City, up from fewer than 215 a decade ago. Even so, Reserve Cut is one of only about a half-dozen kosher eateries where the bill would ring up to more than $70 per person, says Elan Kornblum, who runs the review site and community Great Kosher Restaurants. e growing clientele is one reason Reserve Cut will gross more than $10 mil- lion this year, Allaham said, a 10% increase from last year.
New spin on family traditions A er emigrating with his family to Brooklyn from Damascus, Syria, in the 1990s, a teenage Allaham worked a er school at a butcher shop in Midwood owned by family members. When broader culinary trends began to shi toward the artisanal, Allaham decided he wanted to emphasize quality meat in kosher HIGH STEAKS: butchery. e family launched a second, more upscale shop nearby. Allaham’s family legacy as a butcher “When we opened Prime Cut, no one was grading kosher meat—prime, helped inspire his choice, select,” Allaham said. He learned about the best ways to age meat and how upscale steak- to oversee the koshering process so that the steaks weren’t oversalted. house, Reserve Cut. When he decided to go into the restaurant business, Allaham partnered with a client who ran the restaurant that preceded Reserve Cut, kosherizing the kitchen, updating the dining room and relaunching it as a sleek, FiDi hot spot. He set about upping the kosher-cooking game. “Every day the chef, butcher and I talk about new ideas,” he said. at includes thickening some sauces with a parve (nondairy) cream and making “butter” from rendered fat. Allaham brought his butcher shop experience to bear, setting up his own aging room. He wanted a steady supply of wagyu beef, a Japanese breed prized for its marbled texture, so he recently launched a ranch in Iowa to raise it for his menu. Because he buys meat for three businesses—the two butcher shops and the restaurant—he is able to plan purchasing to get the best quality in a market infamous for low supply. But he realized that running a restaurant is a far cry from owning a butcher shop. “Being kosher at home and being Orthodox, every Friday and Saturday we have meat,” Allaham said. “Saturday night, no one wants meat again. I wanted to give them another option.” He added sushi as an appetizer and Dover sole as an entrée. To supplement the food with ne service, he recruited managers and servers from high-end, nonkosher restaurants around the city. He also traveled the world to blend his own kosher wines, hoping to make ordering a bottle more FOCAL POINTS common among kosher diners. “I want every kosher person who comes to Man- hattan to try Reserve Cut to be impressed,” he said. In striving for that goal, Allaham succeeded in shedding kosher restaurants’ LOCATION 40 Broad St. penchant for nostalgia, a trait that attracted previous generations hungry for a OWNER Albert Allaham taste of the Old World. “ e style of service, the silverware, the dishes, all the things that bespeak a more upscale experience—these have been incorporated,” BORN Damascus, Syria said Deborah Dash Moore, the author of Jewish New York and a professor of his- LIVES Ocean Park, Brooklyn tory at the University of Michigan. “One of the reasons why non-Jews are joining HOUSE STAPLE The short-rib taco appetizer is so popular, the chef hasn’t is because the food is good and the atmosphere is right.” been able to take it off the menu since opening. But Allaham is not alone. A growing number of kosher restaurants is drawing LIGHTENING UP When the restaurant opened in 2013, Allaham ate steak crowds, and an upscale spot, Wall Street Grill, is expected to open nearby soon. every day. But after about two years, he lightened up his order. “For lunch, Moore suspects others will follow. it’s salad with chicken or sh,” said Rick Bruner, the restaurant’s operations “Jews have gone into businesses where fashion and style and taste are import- manager. “Only sometimes steak.” ant and you have to be nimble to keep up or create trends,” she said. “As eating out has become stylish in the past 40 years, you see more Jews in the restaurant 2018 REVENUE Projected at more than $10 million
BUCK ENNIS business. And some of them are kosher.” ■
8 | CRAIN’S NEW YORK BUSINESS | NOVEMBER 26, 2018
P008_CN_20181126.indd 8 11/21/18 5:15 PM The History of Giving Tuesday
ew York is a city known for its robust nonpro t community and the energetic spirit of giving that fuels charities addressing Nchallenges from hunger, educational gaps and income inequality. With Giving Tuesday arriving Nov. 27—the Tuesday a er anksgiving— it’s an ideal time to contribute to the nonpro t organizations that do so much to make life better for those in need.
e global day of giving that we are celebrating has become an annual tradition that kicks o the end-of-the-year charitable giving season. Giving Tuesday started when two organizations, the United Nations Foundation and the 92nd Street Y, joined forces in 2012 to create a day that celebrated generosity. Soon other organizations united with them, and the founding partners expanded to include Aldo, Cisco, Google, Groupon, Iraq and Afghanistan Veterans of America, Mashable, Microso , Skype, Unilever and UNICEF. Today, the event, fueled by the #GivingTuesday social media campaign, is celebrated by families, schools, businesses and other organizations interested in helping those in need.
So how can you take part? ere are many ways to give.
Making a monetary donation so charities can pay for programs that help the community is one powerful way to do that. Donating your time and expertise, however, can be just as powerful. Many charitable organizations invite their supporters to get involved by giving their time to volunteer projects. Some companies in the New York metro area mark the day by giving their employees paid time to get involved in charitable projects that matter to the employees.
ese nonpro ts cannot operate without community support, so we invite you to read about what they’re working on and to reach out and help in whatever way you can.
www.angelsinafrica.org www.childrensaidnyc.org www.thefloatinghospital.org/donation (212) 350-2345 (212) 949-4936 (718) 784-2240 Ext. 213
Angels in Africa Women’s Village As one of New York City’s largest and With a gi to e Floating Hospital and School provides food, clothing, most comprehensive children’s charities, this season, you can help families shelter, and HOPE to poorest Maasai. we provide kids with the things we living in homeless shelters and Education for 850 elementary, 125 know they need to thrive: high-quality domestic violence safe houses receive secondary, 12 university. Goal SELF- academic and social-emotional support, a needed health care services. We treat SUSTAINABILITY! full array of physical, dental, and mental health care as a basic human right, health services, and the skills they need to serving one-quarter of NYC’s family advocate for themselves and to strengthen homeless population. Health care for their families and communities. all IS possible. You are the key.
Crain’s Giving
www.ujafedny.org www.uhhm.org Guide (212) 980-1000 (347) 454-2793
UJA-Federation of New York e Universal Hip Hop Museum in cares for Jews everywhere and the Bronx is the ocial museum of New Yorkers of all backgrounds, Hip Hop. Our mission celebrates and responds to crises close to home and preserves the history of local and far away, and shapes our Jewish global hip-hop music and culture to future. And it starts with you. Join us! inspire, empower and to promote understanding. UHHM was founded to preserve, showcase and celebrate the culture’s past, present and future.
AN ADVERTISING SUPPLEMENT TO CRAIN’S NEW YORK BUSINESS
Crain's 2018 Giving Guide A.indd 1 11/20/2018 11:45:05 AM VIEWPOINTS
City falling behind as others embrace the cloud
Public services would be easier to get with an app BY JUSTIN BRANNAN
f you have a smartphone, you Why can’t we summon one as easily as huge strides in how likely use apps to accomplish ev- ordering lunch or paying a bill? And the city provides con- eryday tasks, from paying your what can the City Council do to make stituent services. cable bill to ordering takeout to city agencies work better with new If we encourage Ihailing a taxi. at means you also use technologies? Or just make more city cloud adoption by more the cloud. services accessible via an app? agencies to increase ef- e what? e cloud has helped improve the ciency and build better ese apps are made possible by safety of New Yorkers by enhancing apps, we could provide internet-based cloud computing. By the transportation infrastructure. e new and better services for New York- using information technology services Department of Transportation built ers. With cloud computing, we could securely delivered over the internet Vision Zero View and iRide NYC ap- provide those services in a more resil- from the data centers of leading tech plications on the cloud, using crowd- ient, secure and agile way than through the greatest city in the world, and no companies, such as Microso , Google sourcing to collect safety data that can traditional information technology. one should be eating our lunch. New and Amazon, cloud computing lets de- be used to redesign streets and tra c With fewer long-term contracts and York should be the undisputed glob- patterns with the goal of reducing traf- reduced up-front costs, we can avoid al leader in modernized services, but With fewer long-term c fatalities to zero. many of the risks—and scandalous fail- we’ve got some catching up to do. e council’s Committee on Con- ures—that have come with large, com- From coast to coast, virtually every contracts and reduced tracts, which I chair, has been looking plicated IT projects. other major city and state is adopting for ways our government can work Additionally we can open up new cloud- rst policies and priorities. We up-front costs, we can more e ciently to give constituents ways for citizens to engage with the in the City Council must work with the avoid many of the risks timely services and assurances their tax city, creating new opportunities for all. de Blasio administration to take our dollars are well spent. Part of the search For example, with a more connected, rightful place at the head of the inno- and scandals that have is looking at how we are using our tech- app- and technology-driven city, we vation pack. come with tech projects nology services this year. can get quicker responses to inquiries In so doing, we might just help turn In a city the size of New York, these and richer data on what is working and the Big Apple into the Big App. ■ aren’t easy tasks. But thanks to the ex- what isn’t, and move faster to address velopers build great apps that make life plosive growth and the advancement problems when they arise. City Councilman Justin Brannan is easier for millions of New Yorkers. of new technologies for the storage, New York City is moving toward chairman of the council’s Committee on I have wondered, then, why city ser- security and use of information in the more cloud use and apps for services, Contracts and a Lindsay Fellow at the vices cannot be so simple and e cient. cloud, we have an opportunity to make but it’s not moving fast enough. We are City University of New York.
FROM OUR READERS Put transit improvements on the Amazon wish list
DETAILS OF THE Amazon e timing couldn’t have to be a good neighbor. shutdown and before any A heavy-duty freight HQ2 deal (“Primed for been worse. As transit What’s good for Ama- new Amazon employees trike such as those Amazon,” published Nov. riders contemplate how zon should be good for even show up for work. manufactured by 12) came just days before much more they’ll be transit in Long Island Improving tran- Cycles Maximus (in the release of the Metro- paying, Amazon will City. Not one station sit infrastructure for Bath, England) and politan Transportation essentially get a free ride. near the planned HQ2 long-term capacity in operated by Revolu- Authority’s proposed Don’t get us wrong: is in the MTA capital Long Island City is a tion Rickshaws right budget for 2019 to 2022 25,000 new jobs will program. ings like no-brainer, and Amazon here in New York. and announcement of be a boon to the local ADA accessibility, new should demonstrate that Each trike is rated economy and turnstiles, wider access it wants to be part of the for 550 pounds and should bolster points, recon gured solution, not an addition sports weatherproof local employment. stairs and more platform to the problem. cargo capacity of Billions of dollars capacity will go a long LISA DAGLIAN over 40 cubic feet. in construction and way toward improving Executive director Plus, it slots right other investments trips, particularly in Permanent Citizens Advisory into the average bike will come as well. the face of anticipated Committee to the MTA lane, occupies min- Unfortunately, growth (even before imal parking space, none of that money Amazon’s in ux). Close TRAFFIC? TRY TRIKES and—even when is slated to improve to 12,000 residential Re “Clash on delivery” tted with an electric Long Island City’s units are to open in Long (published Nov. 5): assist—doesn’t emit. transit infrastruc- Island City by 2020, What’s a fraction of It’s true, driving one whose worst externality ture. bringing with them an the size of a motorized of these vehicles can is stronger legs? But it isn’t too estimated 23,000 peo- van or truck but just as be physically demand- HELEN ZUMAN late. ple—many of whom will capable of carrying many ing—as I learned during Beacon, N.Y. An investment be ghting for space on of the parcels delivered my stint as a Revolution e writer is married to upcoming public hear- by Amazon in transit the crowded 7 line and by companies such as courier years ago. But Gregg Zuman, founder ings and potential fare infrastructure would in packed stations. at’s UPS and FedEx? A bird? what’s not to love about and principal of Revolu- increases of up to 4%. indicate that it wants not accounting for the L A drone? Superman? No! a mode of transport tion Rickshaws.
CRAIN’S WELCOMES SUBMISSIONS to its opinion pages. Send letters to [email protected]. Send op-eds of 500 words or fewer to [email protected]. Please
ISTOCK, JOHN KUCZALA, PETER D’AMATO include the writer’s name, company, address and telephone number. Crain’s reserves the right to edit submissions for clarity.
10 | CRAIN’S NEW YORK BUSINESS | NOVEMBER 26, 2018
P010_CN_20181126.indd 10 11/21/18 11:58 AM PUBLIC POLICY
AT YOUR DOOR: Ponce seeks out tenants to ask what issues they need help with.
A program for every problem
New York’s safety net is unmatched—and made possible by the very inequality it targets BY CARA EISENPRESS AND GREG DAVID
t’s not hard for Stephania Ponce to get into the rent-regulated Brooklyn build- ings on her canvassing list each day. O en the front door just pushes open, and otherwise a tenant rings her in. Ponce, a tenant-support specialist, then goes from unit to unit asking residents if they have been harassed by the landlord or are behind on rent. Today she’s on Je erson Street in Bushwick, which is gen- Itrifying like its neighbors Bedford-Stuyvesant and Williamsburg. “City of New York,” she says as she knocks, changing to “ciudad” when the answering accent warrants. Tenants tell Ponce of settled charges still appearing on their rent bill, building in- spectors who don’t show up for appointments and withholding rent until repairs are made. She schedules follow-ups and adds complaints to her caseload—which was 97 that day—using a special iPad app the city created. “People are surprised,” Ponce said. “ ey say, ‘How did you know I was having
problems?’ ” BUCK ENNIS
11 | CRAIN’S NEW YORK BUSINESS | NOVEMBER 26, 2018 NOVEMBER 26, 2018 | CRAIN’S NEW YORK BUSINESS | 11
P011_P014_CN_20181126.indd 11 11/21/18 3:27 PM P011_P014_CN_20181126.indd 12
BUCK ENNIS 12 PUBLIC POLICY |
CRAIN’S NEWYORKBUSINESS billion. cost told, $100 million. All eorts these $60 surpass MetroCard discounts for are to poor the expected it up. $93 million, rising to $155 millionscaled when and employment Lawyers for tenants services. cost lion on programs for HIV/AIDS, domestic violence operations and housing placement, plus- $670mil 3-year-olds add$203million. will costs city the $863million ayear, and extending it to fordable housing last year. Universal prekindergarten icaid and home care and $1.1billion allocated for af- care,health city the spends $6billion while on Med- state spends $57billion on Medicaid and other assault by Republicans inWashington. supplement under those bene ts, federal especially Publicthe Engagement Unit and providing money to rolling using bene ciaries outreach such as through of federal, state and city programs, aggressively en- country. It by this does knitting together asafety net erosity, and eort scale unmatched anywhere inthe eligible people receive ones the they’re entitled to.” city.the “We on have making sure focused been that largestthe administrator of public federal bene ts in commissioner Services, of Department the of Social ents to come into o ces and wait,” saidSteven Banks, bene ts are provided, [formerly] which required cli- agencies. apps, people don’t so have to to government schlep can go through oneeverything of city’s the mobile for seniors and disabled. the Transactions for nearly sistance Program or NYC the Rent Freeze Program help, such Supplemental as federal the Nutrition As- companies and screens for them eligibility for other es tenants through confrontations with management plication for emergency rental assistance. She coach- city’sthe right-to-counsel program or suggest an ap- Ponce an does interview, she might make areferral to ment Unit, guides150caseworkers. which Once of as part city’s the services or social Public Engage- residents are likely assistance to need with rent, food e spends city about also $1.5billion on shelter It’s impossible quantify, to fully but New York New York City a er looks its poorest with agen- “ ere’s asigni cant change way inthe public Ponce knows she because visits where ZIPcodes
|
NOVEM BER 26,2018 inequality, Ravitch Program the Reporting Fiscal at cies play inreducing or exacerbating impact the of proven to work long inthe term. budget not does invest enough in income. Moreover, despite robust the safety net, the ing into class middle the requires amajor increase in expansion. New York is an expensive place, and mov - slightly declined during decadelong the economic than 40%innear poverty, gures that only have measure, 1in5residents lives inpoverty, and more Medicare for all. rent regulation to implement and trying some of sort ready generates $4.5 billion annually—strengthening pand it by increasing millionaires the al- tax—which and progressives pushing begin inAlbany will to ex- month, safety the net has widespread public support, As sweeping the victories by Democrats showed this is why city the can aord expansive this safety net. inequality—combined taxes on with high rich— the children in poverty in2016 children inpoverty Households receivingcashbene tsper100familieswith NEEDY REACHING THE SOURCE: Texas Georgia Washington New York To understand role the that state- poli and local Yet indigence remains By city’s the pervasive. own Ironically, New York’s pronounced economic 4.0 4.7 CenteronBudgetandPolicyPriorities 25.0 antipoverty eorts 42.7 held it eversince. Annual raises to her hourly wage shopto be steward. She won position the and has a prankster nominated Shirley Drennon, now 58, Flying Foods Group unionized about 15years ago, How workers got araise ply for or renew bene ts online instead of inperson. to upload and store to need ap documents the they - public assistance as well as tools that allow recipients developing screening apps for insurance health and aid get actually it, city the for years several has been Washington state requires most recipients to work. state revenue supplements safety federal the net, and receivewho cash and assistance. food In Texas, no months, and there are work requirements for adults Assistancerary for Needy Families expires a er 48 other states are far less generous. In Tempo Georgia, - philanthropy complements o cial the list. A robust nonpro t network by funded grants and tors. Breakfast and lunch are public inall free schools. York, opera- pantries food and other social-services 1 million residents through of Food Bank the New sistance Program current inthe helps this year; feed ditional $24.8million on its Emergency Food As- and $2.9billion for stamps food inNew York City. ly Assistance, $400million for Safety Net Assistance year, scal state the spent some $1billion for Fami- for or have exhausted Family Assistance. In last the counties fund, kicks in for don’t who those qualify New York’s Safety Net Assistance, state the which and for Needy a er Families, 60months. dry runs which sistance, New York’s version of Temporary Assistance gram (better known stamps) as food and Family As- government for quali ed to those nutrition the pro- safety net. Billions of dollars ow from federal the of inequality inAmerica. economic centers that rank top inthe 10on any list Washington to investigate issue. the are All booming projectsfund in NewGeorgia, York, Texas and CUNYNewmarkthe of School Journalism helped Not long a er Kennedy catering airport company To make sure that New Yorkers for qualify who Although evenNew York’s net leaves many needy, From its own budget, spendan city the ad- will New York by begins supplementing federal the care atMonte ore. Williamson loves thefree BEETS PAYING:
11/21/18 3:41 PM YOUR BURDEN MAY VARY were once a nickel but now are $2, thanks Joann Williamson, 66, goes to the doctor to New York’s raising the minimum wage State and local taxes as a percentage of family income* 20 times a month. She has chronic asthma, in 2015, and she cheered when the Port Richest 1% Poorest 20% high blood pressure and weight-manage- Authority of New York and New Jersey de- 20% ment issues, and she uses a walker. She sees cided this year that airport workers must 17.8% a primary care doctor and a pharmacist, be paid at least $19 per hour by 2023. goes to the hospital for tests, takes weight- “I have been more comfortable paying 15% loss and movement classes, and visits a ther- my bills and putting a little to savings,” 13% apist, who has helped her wean o painkill- 11.3% 11.4% said Drennon, who lives with her 37-year- 10.7% ers. “is week,” she said one September old daughter, a college graduate who has 10% day, “I have been every day except today.” worked her way up to account manager at 7% A lifelong Bronx resident now on Medi- Flying Foods. Since the raises, newcom- care, Williamson pays nothing out of pock- 5% ers don’t quit as frequently. “People stay 3.1% 3% et in premiums or copays—not for the in- because they get better wages,” she said. halers that for three years have prevented “Before, they would have to subsidize their 0 her from having an asthma attack, nor for income with other jobs or get free health GEORGIA NEW YORK TEXAS WASHINGTON the car rides to appointments or the move- insurance. Now they can pay.” *Non-elderly taxpayers SOURCE: Institute on Taxation and Economic Policy ment class. Rapid increases in the minimum wage New York not only accepted the federal have elevated the incomes of working New funding o ered by the A ordable Care Act Yorkers more than any other bene t or regulation. By the New Year, the wage for Medicaid expansion, but it also added an Essential Plan, which is like Medic- oor will have risen by 87.5% in ve years, from $8 per hour in 2014 to $15 aid for those with slightly higher incomes and costs no more than $20 a month this Dec. 31 for large employers in the city, pushing the median family income in premiums with no deductible. For individuals earning up to $17,655 and fam- to $68,353 in 2017, up 4.5% from the year before. Together with record-high ilies of four making up to $36,374, everything else in the plan is free except for employment, the wage increase has lowered the average monthly number of prescription drugs, which are $1 to $3. Only in the highest-earning tier are there cash-assistance recipients by 1% and food-stamp recipients by 2.4%. any copays. Yet when the federal government threatened the funding it provides Quality of life promises to improve. Franz Vieux, a driver at Gate Gourmet at for the Essential Plan earlier this year, Gov. Andrew Cuomo promised to keep LaGuardia Airport who makes $17.50 an hour and works more than 50 hours the service. Only Minnesota also did that. a week, said higher wages will minimize hard choices, like deciding between e state’s Child Health Plus also chips in to insure children whose family buying enough food and paying the $1,900-a-month mortgage on his house in income is between 1.6 and four times the poverty level at a cost to households of Rosedale, Queens. His wife makes minimum wage as a home health care worker, $60 per child per month—maxing out at $180—with no copays. and they care for one of their children, who has cancer. All told, the expanded coverage shrank the uninsured rate in the city from Shelter, too, has become more a ordable, especially for those in rent-regulated 15.1% in 2013 to 8.9% in 2016. Last year the statewide rate was 6% in New York or public housing, and the trend of housing costs outstripping wage growth has compared with 15% in Texas and 12% in Georgia, which did not expand Medicaid. nally reversed, said James Parrott, an economist at the New School, who has e state’s medical coverage is not just large; it’s also e ective, innovative and tracked the e ects of the minimum wage. “People’s incomes are rising more than more a ordable thanks to reforms made during the rst year of the Cuomo ad- housing costs,” he said, “which is counterintuitive to the anecdotal sense that ministration. A key has been integrated approaches to managed care, pioneered people have.” at Monte ore Health System, where Williamson receives her care. Incomes are rising fastest for low-paying jobs, such as food service. From e model works by coordinating treatment—and costs—among providers. 2013 to 2017, the average weekly wage for workers at limited-service restaurants at means pushing health clinics to be more like social-services centers, said in the ve boroughs rose to $417 from $330 even as the number of employees jumped by 23%. For the same reason, income gains have increased more for Latino and black workers than for non-Hispanic whites, Parrott said. Early data even suggest the minimum-wage bump might be li ing not just households but whole neighborhoods where low-wage workers are clustered. Retail employment in the Bronx and Brooklyn has increased. Restaurant em- ployment has risen especially in the Bronx, perhaps in part because those whose incomes have gone up are shopping and eating out more. And clothing store employment was strong in both the Bronx and Brooklyn, likely based on people having more disposable cash, though the trend is not quite as clear. Drennon said people seem to be shopping more on Jamaica Avenue, near where she lives. Tapping a rich vein New York ranks among the most unequal cities in America. e top 1% ac- counted for 35% of all the income in the city in 2016, a full 15 percentage points more than the national gure. is concentration of wealth and the state’s will- ingness to tax it provide funding for the safety net. New York state has for years had the highest combined state and local taxes, according to the Tax Foundation, an anti-tax group. But assuming it extends OPEN SOLICITATION BIDS the millionaires tax, which is due to expire next year, only ve states and the District of Columbia will have more progressive tax systems, according to the DUE DECEMBER 21, 2018 le -leaning Institute on Taxation and Economic Policy. e top 1% of earners in New York pay state and local taxes amounting to 11.3% of their income. e gure is only 3% in Washington and 3.1% in Texas, states with no income tax. e poorest h of New York households, meanwhile, pay 11.4% of their The Empire State Connector is a 1,000 MW, income in state and local taxes compared with 17.8% in Washington and 13% in Texas. New York has the nation’s most generous earned-income tax credit, and bi-directional HVDC transmission line that the city adds one of its own. e upshot is that most of the poorest residents not only pay no income taxes but also get money back when they le a return. will provide a direct connection between e richest provide much of the money for the safety net because their earn- ings are so high. State income tax generates $50 billion a year and two-thirds of Upstate New York and New York City. all state tax revenue. e top 1% alone pay 40% of all income taxes. It’s the same story for the city’s modestly progressive income tax. e 1% account for 43% of The Empire State Connector is projected those taxes. It adds up to $20 billion for the state and $6 billion for the city, just in income taxes. to be in service in 2023. Healthy coverage www.ESCsolicitation.com e number of city residents without health insurance is lower than at any time since people began keeping track because New York has embraced the Af- [email protected] fordable Care Act.
NOVEMBER 26, 2018 | CRAIN’S NEW YORK BUSINESS | 13
P011_P014_CN_20181126.indd 13 11/21/18 4:24 PM PUBLIC POLICY INVESTMENT PAYS OFF ASAP
Stephen Rosenthal, chief operating o cer at Mon- WITH A GOAL OF MOVING 800,000 people out of poverty te ore’s CMO, e Care Management Co., which or near poverty, the de Blasio administration is trying to put focuses on the patient experience. “We have learned some bounce in its safety net. Instead of just preventing des- that, in order to be e ective at managing care, we titution, it aims to create opportunity for New Yorkers. have to go one step beyond and manage their lives.” One success has been an initiative focused on college Eighty percent of the Monte ore population is persistence. It has rapidly expanded the number of CUNY enrolled in government health coverage, a propor- community college students who earn an associate degree tion that would challenge the bottom line of a hospi- and go on to get a bachelor’s. tal in most places. But New York state provides rela- “One of the biggest platforms for economic mobility is tively high reimbursements to providers and covers going further in education,” said Matt Klein, the executive mental health, substance abuse, long-term care and director of the Mayor’s Of ce of Opportunity, which in 2007 prescriptions. funded CUNY’s Accelerated Study in Associate Programs. A Monte ore saves so much money managing care pilot with 1,000 low-income community college students, ASAP included tuition assistance, men- that funds can be used to help patients nd or keep torship and help paying for books and MetroCards. In the 2018–19 school year, the program has apartments. Secure living conditions help patients been expanded to 25,000 enrollees—more than 25% of matriculating students at CUNY community heal, said Deirdre Sekulic, assistant director of social colleges. Its students graduate at double the usual rate, leading an outside study to conclude that the work at Monte ore, saving even more. Likewise, in- public investment pays off in increased tax revenue and social-services savings down the road. stalling mental health practitioners and caseworkers Daysa Torres (above right) expects to bear out that math. The mother of two grew up in the Bronx at clinics ensures that care is delivered to those who and now lives in East Harlem. Before college, she worked in retail at an electronics store, but even need it. Monte ore is in the middle of an expansion with a promotion to a purchasing job, she felt her hourly salary would never be much more than mini- mum wage. “I needed more because I had children,” she said. that will bring its theories of care to 3.5 million peo- She went to Hostos Community College in the Bronx, where she found psychology and ASAP. A ple in the state, up from 1 million in the city, and its transfer to Hunter College has put 2019 graduation in her sight. She plans to become a college advis- model has traveled farther still. er, a position that would satisfy her ambitions and support her family. As a longtime patient, Williamson feels comfort- With Torres’ busy life and responsibilities, ASAP—which requires students to carry a full course able navigating the system, avoiding yet more stress load—sped up her time line. “I’m 29,” she said. “Twenty- ve was when I was like, ‘What am I doing that might compound her issues. “I have been lucky with my life?’ Time was important. I was like, ‘I have to do all of this before 30.’ ” to have doctors who are good,” she said. “I have a — C.E. good primary. I can call or text her, and she texts me back.” BARBELL ECONOMIES MetroCards for residents below the federal pover- Chipping away at housing problems ty line. Mayor Bill de Blasio is extending pre-K to Average annual income, top 1% and bottom 99% (2015) New York City residents are convinced the city 3-year-olds, providing free schooling for an expect- confronts an intractable housing crisis. e deteri- ed 62,000 children in addition to the approximately oration of New York City Housing Authority prop- $2,202,480 70,000 in his program for 4-year-olds. erties imperils its estimated 600,000 residents. e homeless shelter population is now at 61,000, and a What if the rich leave? January count found 3,675 unsheltered. About half Wealthy residents tolerate the taxes that pay for the tenant population is severely rent-burdened, $1,343,897 $1,360,200 all this because New York is one of the most inter- paying 50% of their income for housing. esting cities in the world and a place where they can e impact on the poor is clear. $995,500 make a lot of money. But with federal tax reform, “If someone had a housing hardship [in the past which took e ect in January, Republicans and Pres- month], all their other hardships skyrocketed,” said ident Donald Trump have made it even more ex- Nancy Rankin, vice president for policy, research pensive for them to live here than before relative to and advocacy at the Community Service Society zero-income-tax states such as Florida and Texas. If of New York. “If they experience housing hardship, even a few leave, the loss of tax revenue would be they cut back on everything else. ere’s the risk of $44,147 $49,617 $55,614 $62,500 signi cant. eviction or homelessness.” GEORGIA NEW YORK TEXAS WASHINGTON Consider these numbers for 2015, compiled by At the same time, no city is doing more to help. SOURCE: Economic Policy Institute E.J. McMahon of the Albany-based Empire Center Regulation greatly limits rent increases for 1 million for Public Policy: Some 2,541 New Yorkers with an apartments, and outreach like Ponce’s helps the city adjusted gross income of $10 million or more paid keep tabs on conditions in them. Meanwhile, the through it, and my children went through it. I didn’t an average of $2.7 million in state personal-income city is working to reduce evictions by streamlining want us to go through it again.” tax. If just 1% le the state, $69 million in New York rental assistance and funding lawyers for tenants. Using vouchers can be di cult for apartment tax revenue would disappear. If the same percent- For years, di erent state and city programs have shoppers because they carry a stigma of homeless- age of the 3,653 who earned between $5 million handled rental assistance for various households de- ness. Aer many reports of prospective tenants be- and $10 million—who paid an average income tax pending on their history and quali cations, such as ing rejected for apartments, the city says it is work- of $902,000—departed, the impact would be $32 whether they had spent time in shelters or had dis- ing with landlords to improve acceptance. million. And if New York lost 1% of the 13,863 tax- abilities. In July the city announced that rental assis- e city also spent $238 million last year in emer- payers who made $2 million to $5 million and paid tance would run through a single program, which gency rental assistance—loans or single payments to an average of $238,000 each, it would receive $33 launched late last month. e idea is to make it less prevent eviction for those who have temporary cir- million less. confusing for both tenants and the landlords who cumstances that might lead to homelessness. ey “It’s real money, even by Albany standards,” Mc- accept city money in lieu of rent and to make it easi- range from a few hundred dollars to more than Mahon said. “And that’s not even counting their lo- er and quicker to receive the kind of help that South $30,000 and can be awarded even to applicants with cal taxes or the economic multiples of their charita- Bronx resident Mariana Munoz, 33, got this summer. less than sympathetic stories, such as the woman ble giving, purchasing and employment.” Munoz, a home health aide from Honduras with who fell behind on rent because she went to the Do- Of course, the risk is not that 1% of high earners three teenage children, fell behind on her rent aer minican Republic for liposuction. ough consid- leave but that 10% do, taking $1.3 billion a year in her husband le in January. She doubled her hours to ered one-shots, some tenants get them two or three tax revenue with them. e revenue loss would cut full time at her $13-an-hour job, but she still couldn’t times in a year, and about 80% are behind on repay- into the social safety net and the city’s e orts to open come up with $1,196 in rent. In early spring she went ing their loans. up economic opportunity to those at the other end to HomeBase, a city-run homelessness-prevention Compare New York to Seattle, a progressive city of the income scale. And it would upend a world- service. It took more than three months, but she that has struggled to build a ordable units as rents view embraced by city o cials—and at least accept- quali ed for assistance in July, and the CityFEPS pro- have soared 65% since 2010 amid an Amazon-fueled ed by most residents and companies here—that it is gram now pays more than half of her monthly rent— economic boom. Washington state has banned rent the government’s job to tackle big problems with a about what her husband once did. Munoz, who had control, and for single people, the city limits rent budget commensurate with their scale. ■ lost her home once before, was able to stay put with help to those making no more than $31,000 and to the two kids who still live with her. six months in duration. is story was produced in collaboration with the “I would have ended up in the shelter like I was In New York the safety net continues to grow. In Ravitch Fiscal Reporting Program at the Newmark
BUCK ENNIS 13 years ago,” she said through a translator. “I went January the city will begin paying for half-priced School of Journalism, City University of New York.
14 | CRAIN’S NEW YORK BUSINESS | NOVEMBER 26, 2018
P011_P014_CN_20181126.indd 14 11/21/18 3:42 PM REAL ESTATE
Hoping for a Hollywood ending
Once-shimmering ragedy has held sway over comedy at the Metro, a beautiful, old, art deco movie METRO house on the Upper West Side. e building, adorned with a glazed medallion of the Upper West Side movie palaces Greek dramatic symbols, has sat empty on Broadway between 99th and 100th streets The owner have become since 2006. In its heyday it showed Marx Brothers comedies and romances starring nally may have Cary Grant and Katharine Hepburn. At a low point in the 1970s, it became an adult- found an arts battlegrounds organization to T lm theater. But for most of its 85 years, it has screened rst-run, independent and foreign lms. take it over, 12 for the city’s Down and even out for a time, it was never dark for this long. years after the In the past dozen years, plans have been announced, then abandoned, for the theater at 2626 doors closed. quality of life Broadway to become an Urban Out tters, the headquarters for an arts nonpro t, an Alamo Dra - house movie theater, a Blink Fitness and, most recently, a Planet Fitness. e lack of follow-through BY STUART MILLER has frustrated community leaders and infuriated residents who miss the movie theater and accuse BUCK ENNIS, ISTOCK
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P015_P017_CN_20181126.indd 15 11/21/18 3:24 PM REAL ESTATE
LOEWS KINGS Flatbush The theater, owned by the city, underwent a $95 million renovation and reopened in 2015 for live performances.
the owner of being greedy and unreliable. Now, how- social anchors for their communities. e rst was locals campaign to turn the projection lights back on, ever, the Metro is once again on the verge of reclama- the Regent, built in 1913 by omas Lamb at 116th that’s typically not a realistic solution. tion. Albert Bialek, who bought the theater in 1989, Street and what is now Adam Clayton Powell Jr. Bou- But their closure can leave cultural holes. When said he is close to signing a deal with a nonpro t to levard. (Today it is home to the First Corinthian Bap- the American eater in Parkchester closed in 2013, take over the partially landmarked building. tist Church.) Nearly every neighborhood soon had its it le the 1.4 million residents of the Bronx with just “It’s just sad seeing the Metro slowly deteriorating own palace with an average of 1,800 seats and lavish two movie theaters. e site was converted into a when it could have an enormous impact on the neigh- decorations. Marshalls, which rankled community members who borhood,” said Gary Bornstein, founder of Wingspan But the rise of television in the 1950s, New York’s argued that another discount store was low among Arts, the nonpro t that had a handshake deal to take scal crisis in the 1970s and the crime surge in the the neighborhood’s priorities. over the theater in 2012. crack era all played a role in the decline of these mov- e same objections are being made by Council- In a city with 8.6 million residents packed within ie theaters. en the subsequent real estate boom man Ydanis Rodriguez about the Coliseum at West 303 square miles, aging movie theaters have become made the land beneath them increasingly valuable. 181st Street in Washington Heights. e 1920s build- a preservation battleground that o en pits developers Large-screen home entertainment centers and mov- ing, dark since 2011, failed to get protection from the looking to make a pro t against elected o cials eager ie streaming on smartphones didn’t help. Coupled city’s Historic Monuments Preservation Committee to maintain quality of life and resi- and is expected to be razed. A pro- dents seeking communal and cultural posed shopping mall may replace it. gathering spaces. A er notable fail- “SUCCESS IS A PROJECT THAT IS Washington Heights has about ures in recent years such as the Amer- PROFITABLE BUT ALSO WELCOME 150,000 residents and no movie ican eater in the Bronx, which is theaters. Rodriguez objects to the now a Marshalls, and successes such BY THE COMMUNITY. YOU NEED TO planned glassed-in mall and the lack as the Kings eatre in Flatbush, now FIND A USE THAT MAKES SENSE of communication from the develop- a live-performance venue, communi- er, BLDG. e building remains va- ties are hoping to nd a road map for IN TODAY’S REALITY” cant, years a er talk of its demolition. success with long-empty theaters such “We don’t need more Marshalls as the Metro, RKO Keith in Flushing and Targets,” Rodriguez said. “ ey and the Hamilton in Harlem, among several others. with the high cost of modernizing theaters for digital [BLDG] did not respond to or reach out to the com- “ ere’s a desperate need for any space geared to- projection, the economics of these old picture houses munity board, the BID or our o ce to discuss their ward the community—something for young people simply didn’t work anymore. plans. is is not the best way to enter a community. and seniors,” said Assemblyman Ron Kim, who is More than two dozen movie palaces built between ey need to be responsible to their investors but also eyeing the RKO Keith in his Queens district. Demoli- 1910 and 1932 have been closed or razed. Of those to the community. ey are not respecting us.” tion and plans for a large glass condo tower have ap- still standing, some were transformed into retail BLDG did not return calls seeking comment. parently stalled, and Kim hopes a coming downturn stores or gyms; others were reimagined. Frequently “Some people are so stuck on short-term pro ts in the Flushing condo market could give the site new they became churches. Even the Ziegfeld eatre, one and turnaround, but not every developer is like that,” life. “ ere’s no place to meet and interact.” of the last single-screen theaters in the country when Kim said. He hopes he can broker a happy ending for it opened in 1969, closed in 2016 a er converting to the RKO Keith. “I would connect developers to city Fairytale beginning digital projection. It is now Ziegfeld Ballroom, an and state agencies to help provide subsidies and in- Once upon a time New York City did not have event space. centives.” multiplexes—it had movie palaces, dazzling buildings e movie houses that remain pose challenges to Indeed, politicians have demonstrated an enor- that screened movies, hosted vaudeville and became communities and developers alike. While nostalgic mous willingness to nd money to give the public
16 | CRAIN’S NEW YORK BUSINESS | NOVEMBER 26, 2018
P015_P017_CN_20181126.indd 16 11/21/18 3:16 PM VICTORIA HAMILTON COLISEUM Harlem Harlem Washington Heights Undergoing a $178 million redevelopment into two The Landmarks Preservation Commission, which protected Reportedly to be razed and replaced by a mall despite theaters, apartments and a hotel to open in late 2019. the facade in 1999, reportedly has approved a design to community opposition. convert the building to retail and of ces.
PAVILION RKO KEITH AMERICAN THEATER Prospect Park Flushing Parkchester Under construction. It is expected to open by year’s end as Work has stalled on plans to demolish the unprotected It opened in 1940 as a Loews theater. It was converted into the Nitehawk Prospect Park. portions of the theater and convert it to a glass condo a multiplex, last operated by Bow-Tie Cinemas. It closed in tower. 2013 and reopened as a discount retailer.
access to these sites. operated by the Apollo eater Foundation, which he said it went “at least 20% over budget” once his “We have to be more creative, with the goal of will work with other groups, such as the Harlem workers “started peeling back layers of carpet and nding cultural uses with community purposes,” Arts Council, Jazz Mobile and the Classic eater muddy drywall.” said Councilman Mark Levine, who represents the of Harlem. “ e state of disrepair in the theater suggested Upper West Side neighborhood where the Metro is “Success for us is a project that is pro table but is almost proactive neglect,” Viragh said. His workers situated. also welcomed by the community,” Livingston said. uncovered marble stairs, brick and plaster work that “You need to do things in balance and nd some- he has spent extra to restore, he added. The plot turns thing that makes sense in today’s reality.” Meanwhile, residents on the Upper West Side are e Loews Kings eatre in Flatbush, which Revival has come to the western corner of Pros- tempering their hope as Bialek, the Metro’s owner, closed in 1977 and sat empty for decades, was once pect Park too. e Park Slope Pavilion was a much- once again says he is nearing a deal. an example of theater blight. Now it is a shining used but much-loathed institution. It was poorly “For the last 12 years, it has sat like a festering beacon for turnaround. e city, which owned it, maintained and known for broken seats and toilets, wound,” local activist Debbie Rosenberg said. partnered with a private developer on a $95 million sticky oors, bugs and rodents. But when it closed in Levine said he’s advocated for an arts-oriented renovation. e glittering, ornate palace reopened 2016, it le a void in the community. use and oered to help Bialek on land-use issues, but in 2015 as a live-performance space. Owner Hidrock Properties drew howls of out- he’s been rebued. Along the way, it has helped revive the neighbor- rage for its initial plans to redevelop the theater and “ e Metro is in private hands, and that leaves us hood—a new gym and hotel recently opened near- its adjacent property into condos and retail space. with limited tools,” Levine said. “His goal has been by, providing jobs. “It has raised the visibility of the City Councilman Brad Lander helped persuade the to maximize rent; I have other goals.” neighborhood and expanded people’s knowledge developer to at least maintain a movie theater on the Bialek blames zoning changes and other issues of Brooklyn,” said Tyler Bates, the venue’s general site. But in the face of a so ening luxury condo mar- for the one-step-forward, three-steps-back pattern manager. Since taking the job in 2017, Bates has in- ket, Hidrock elected to sell. of progress. But now he is waiting for just the non- creased bookings by 50%. e developer fetched $28 million for just the pro t suitor’s board to vote by month’s end on ap- “You need to have places for people to gather and theater—a handsome pro t on the combined $16 proving the costs of a capital campaign. share experiences, to celebrate music or culture in a million Hidrock spent on the two lots—when it sold He has a “high degree of con dence” that the positive environment, whether it’s a movie theater to a group of private investors assembled by Mat- project will move forward. e organization, which or something else,” Bates said. “Otherwise you are thew Viragh. In the deal, Viragh, who owns Wil- would either buy the building or sign a long-term doing the people of a community a disservice.” liamsburg’s Nitehawk Cinema, received a friendly lease with an option to buy, plans for a mix of pro- Even developers of some privately owned former lease and will reopen next month as the 650-seat gramming for seniors and others, along with at least theaters agree. Nitehawk Prospect Park. one state-of-the-art, o-Broadway theater. Craig Livingston, managing partner at Exact “We are keeping it as an independent, locally “ is would have a tremendous impact on busi- Capital, is trying to give the Victoria eater in Har- owned movie theater,” Viragh said. “It’s about dol- ness around here,” Bialek said. “It will bring vitality lem a new life for investors and residents. lars and rent and being lucky to have a supportive and life to the street. It can be the new face of the is architectural gem, just 160 feet down the landlord, but we also have a dierent type of theater neighborhood.” street from the Apollo eater, will retain its historic that generates more revenue.” Levine said the impact of a community arts or- facade and lobby; the $178 million redevelopment e Nitehawk in Park Slope, like its Williamsburg ganization striking a deal could extend beyond the rising above it will include a 25-story apartment counterpart, will serve upscale food and drinks at Upper West Side, potentially providing a road map building and a 26-story hotel and retail space set to patrons’ seats. It also will cater to families with chil- for other sites, such as the Hamilton, at West 146th open late next year. dren-friendly programming. Street and Broadway, and the Coliseum.
Two theaters will be built on the lower levels and Viragh planned a $10 million renovation, but “If it works,” he said, “I see hope for the others.” ■ BUCK ENNIS, ISTOCK
NOVEMBER 26, 2018 | CRAIN’S NEW YORK BUSINESS | 17
P015_P017_CN_20181126.indd 17 11/21/18 3:16 PM TO PLACE A CLASSIFIED AD, CALL 1 212-210-0189 OR EMAIL [email protected]
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18 | CRAIN’S NEW YORK BUSINESS | NOVEMBER 26, 2018
P018_CN_20181126.indd 18 11/21/18 3:46 PM CNYB_FullPage.indd 1 11/21/2018 12:05:16 PM GOTHAM GIGS
DANGER believes practicing parkour can improve problem-solving skills.
BY LANCE PIERCE
Flipping over obstacles Traditional schooling didn’t suit a parkour athlete, but he’s built a career teaching others how to move
o see Jesse Danger scamper along a railing, dive an obstacle course competition series on NBC, has drawn JESSE DANGER over a bench or panther-leap to the top of a wall, more people to parkour, Danger said. Five of his instructors you would never know he was once an uncoor- have competed on the show. Last year his school’s revenue BORN Princeton, N.J. dinated kid. was well into six gures, up 25% from 2016. RESIDES Bedford-Stuyvesant T“I was the worst kid on the baseball team,” said the pro- Danger discovered parkour through online videos of EDUCATION Dropped out of fessional parkour athlete. “I always felt self-conscious.” teens in Europe. He was 16 and struggling at school. Bloom eld High School Parkour, an urban street sport that orig- “Every day felt like the movie Groundhog AKA Danger, whose given name is inated in France, can turn any cityscape into “There’s not Day, the same thing over and over,” he said. John Rosenberg, adopted his alias an obstacle course. e goal: Take advantage a lot of He started taking the train into Manhattan when he was 12. of existing environmental features and use full- opportunity to practice parkour with other enthusiasts. NO GYM FEES The Movement body movement to the best of your ability. e en he dropped out of high school. Creative offers $30 adult and kid skill set is frequently used in the chase scenes for movement His parents, both computer programmers, classes and by-the-week summer of action movies in which planters, pillars, and play “have tirelessly supported me in being who I day camps in public playgrounds and parks, rain or shine. walls and railings are all fair game. ” am,” he said. Danger found steady work as a “Parkour is about the human capacity for mover, and spent all of his free time practic- TWO ROADS DIVERGED Danger considered becoming a stunt- movement and problem-solving using what’s available ing parkour. He trained at the same time and place each man—a popular career for parkour around you,” Danger said. He has run his parkour school, week, and more and more people started showing up, lm- experts—or seeking corporate spon- e Movement Creative, since 2012. ing his sessions and posting them online. Requests for pri- sorships, but he gured starting a With three full-time and 12 part-time sta ers, e vate lessons started coming in. business had greater longevity. Movement Creative works with several schools (including “I felt like I’d struck a chord,” he said. HEELS OVER WHEELS He didn’t Quest to Learn, a Chelsea public school founded on game- Public performances and sponsorship gigs followed. get his driver’s license until he was 22. “I never had anyplace I wanted based learning), runs a six-week summer day camp and Danger has done ads for athletic brands Saucony and Adi- to go that I couldn’t get to on foot.” during the fall and spring o ers more than 40 group classes das and fashion labels Uniqlo, Bonobos and Rag & Bone. A DAY’S WORK Danger does up to per week for kids and adults. “It’s a shame,” he said, “that in modern life there’s not a lot three hours of physical training daily.
BUCK ENNIS e enormous popularity of American Ninja Warrior, of opportunity for movement and play.” — HILARY POTKEWITZ
20 | CRAIN’S NEW YORK BUSINESS | NOVEMBER 26, 2018
P020_CN_20181126.indd 20 11/21/18 12:31 PM SNAPS BY CHERYL S. GRANT
A kick out of the arts Lincoln Center’s Oct. 24 fall gala raised a record-breaking $3.3 million to support its annual lineup of more than 3,000 free and ticketed events, performances, tours and educational activities. e evening featured songs and music by Cole Porter, performed by Jon Batiste, Liz Callaway, Peter Cincotti, Aaron Diehl and Rayshun LaMarr, among others.
Michael Bloomberg; Patricia Harris, CEO of Bloomberg Philanthro- pies; Robert Steel, CEO of Perella Weinberg Partners; Lincoln Center Chair Katherine Farley; and the center’s acting president, Russell Granet. Bloomberg and Harris presented Steel with an award for distinguished ser- vice. “Bob Steele exempli es service and leadership,” Bloomberg said, “and we Chandrika Tandon, are lucky to call him a friend.” Singer chairperson of Tandon Ranjan Tandon Capital Associates, and her husband, , founder and chairman of Libra Advisors, were among the more than 400 attendees at Alice Tully Hall.
Believe it and achieve it Search for a cure e Alzheimer’s Drug Discov- ery Foundation held its ninth annual fall symposium and luncheon Nov. 2, raising more than $1.6 million for research. Foundation CEO Mark Roithmayr with its founder, Leonard Lauder, chairman emeritus of the Estée Lauder Cos., during the event at e Pierre New York.
e 54-year-old Harlem School of the Arts raised more than $1 million at its annual masquerade ball. Janice Savin Williams, co-founder and senior principal of Williams Capital Group, as well as vice chair of the school, with actor Liev Schreiber, who received the Visionary Artist Award.
Corcoran real estate agent Ana Laspetkovski and honoree David Weinreb, CEO of Howard Hughes Corp., were among the more than 400 dinner guests.
Chef and restaurateur Alexander Smalls, actress Tamara Tunie and singer and pianist Michael Feinstein at the Oct. 22 bene t at the Plaza.
DIA DIPASUPIL/GETTY IMAGES, JULIE SKARRATT, PATRICK MCMULLAN / SEAN ZANNI PATRICK IMAGES, JULIE SKARRATT, DIA DIPASUPIL/GETTY SEE MORE OF THIS WEEK’S SNAPS AT CRAINSNEWYORK.COM/SNAPS. GET YOUR GALA IN SNAPS. EMAIL [email protected].
NOVEMBER 26, 2018 | CRAIN’S NEW YORK BUSINESS | 21
P021_CN_20181126.indd 21 11/21/18 12:29 PM FOR THE RECORD*
NEW IN TOWN ■ Claw Daddy ABS Partners Real Estate landlord, Meringo Proper- Products, was represented tenant and the landlord, 31 Third Ave., Brooklyn brokered for the tenant ties, was represented by an by Cushman & Wake eld. Howard Hughes Corp. ■ Brooklinen e Lower East Side–based and the owner, Wasserstein in-house team. e tenant Colliers International 119 Spring St. Cajun boil restaurant Enterprises. e asking rent did not have a broker in the brokered for the subtenant. ■ XP Securities inked a e online luxury bedding opened a new location in was $38 per square foot. deal. e asking rent was e asking rent was not 10-year deal to move its and towel company opened Boreum Hill, where it also not disclosed. disclosed. oces to 55 W. 46th St. its rst brick-and-mortar will have a raw bar. ■ Designer Gabriela e nancial services rm location, in SoHo. Hearst signed a three-year ■ Compliance Solution ■ Nike nabbed 23,000 will move from 5 Bryant ■ Dos Toros renewal and expansion Strategies subleased square feet of creative oce Park and plans to occupy ■ Burkelman 1 State St. lease for 7,180 square feet 24,650 square feet at 777 space at 89 South St. on 22,518 square feet. e 332 Bowery e burrito chain opened total at 210 11th Ave. e Third Ave. e regulatory Pier 17 at South Street asking rent was $88 per e Hudson Valley–based another location, in the landlord, ABS Partners technology provider plans Seaport. e asking rent square foot. CBRE brokered shop chose the Lower East Financial District. Real Estate, represented to move from 3 E. 54th St. was $300 per square foot. the deal for the landlord, SL Side for its agship, where the tenant and itself in this in the rst quarter of next Meridian Retail Leasing Green Realty Corp., and the it sells pillows and rugs, ■ Green Kitchen deal. e asking rent was year. e sublandlord, Avon brokered the deal for the tenant. ■ – YOONA HA among other housewares. 1619 Second Ave. not disclosed. e all-day diner, which has ■ Frank Mac’s Pub been around since 1913, ■ My Gym agreed to take 425 Amsterdam Ave. opened a second diner spot, 5,600 square feet at 209 DEALS ROUNDUP A er closing McAleer’s, an on the Upper East Side. Smith St. e children’s TRANSACTION SIZE BUYERS/ Irish pub that had a 65-year tness facility plans to open TARGET/SELLERS [IN MILLIONS] INVESTORS TRANSACTION TYPE run, the family behind it ■ Kikoo Sushi its new Brooklyn location reimagined the Upper West 998 Columbus Ave. in the winter. e asking Athenahealth Inc./Elliott $5,947.4 Evergreen Coast Capital FB M&A Side space as a restaurant e East Village sushi rent for the 10-year deal Management Corp. Corp.; Veritas Capital Fund and bar. restaurant expanded onto was $150 per square foot. (Manhattan) Management LLC (Manhattan) the Upper West Side. e landlord, or Equities, WeWork Cos. Inc. $3,000 SoftBank Group Corp. GCI ■ Gabriela Hearst handled the deal in-house. (Manhattan) ■ 985 Madison Ave. Maman Lee & Associates represent- Portfolio of Apoquindo $250 MetLife Inc. (Manhattan); SB M&A e Uruguayan designer 205 Hudson St. ed the tenant. Class A of ces/Capital Advisors Toesca S.A. Administradora opened a agship store on e French café, bakery General de Fondos the Upper East Side. It sells and event space opened its ■ Don Pedro’s signed a Roivant Sciences Ltd. (Manhattan) $200 NovaQuest Capital Management GCI French toiletries and her eighth location, in Hudson 15-year lease for 5,000 LLC.; RTW Investments LLC ready-to-wear collection, Square. square feet at 505 Colum- (Manhattan); SoftBank Investment Advisers which includes shoes and bus Ave. e Yorkville- accessories. based Spanish-Caribbean Asia Co-Living HK Ltd. $181 Warburg Pincus LLC GCI STOCK TRANSACTIONS restaurant plans to open (Manhattan) ■ Hall a restaurant by early next Avenue Therapeutics Inc./Fortress $113.5 InvaGen Pharmaceuticals SB M&A 7 W. 20th St. ■ CBS Corp. (CBS-N) year. Meridian Capital Biotech Inc. (Manhattan) Inc. (N.Y.) (66.7%) Hiroki Odo of Michelin- Anthony Ambrosio, senior Group represented both the Portfolio of 30 assets in France/ $112.5 Not disclosed (unknown FB M&A starred Zen vegetarian executive vice president landlord, Abro Manage- KKR & Co. Inc. (Manhattan) majority stake) restaurant Kajitsu is behind and chief administrative ment, and the tenant. e Armstrong Wood Products Inc./ $100 American Industrial Partners FB M&A this (non-vegetarian) Jap- ocer, sold 8,084 shares asking rent was $200 per Armstrong Flooring Inc. (Manhattan) anese bistro in the Flatiron of common stock at prices square foot. NextCure Inc. $93 Alexandria Venture Investments GCI District. It’s a café during ranging from $57.67 to LLC; ArrowMark Colorado the day and a cocktail and $58.16 per share from Oct. COMMERCIAL Holdings LLC; Bay City Capital wine lounge at night. 31 to Nov. 1. e transac- ■ e Trade Desk agreed LLC; Canaan Partners; Citadel Advisors LLC; Eli Lilly and Co.; tions were worth $467,275. to take 95,580 square feet Hillhouse Capital Management Ltd.; ■ Trellis He now holds 206,080 at 1114 Sixth Ave. e Lilly Asia Ventures; Management of 7 W. 18th St. shares. advertising technology rm NextCure Inc.; NS Investment; OrbiMed Advisors LLC (Manhattan); is fertility studio oers plans to move its headquar- P zer Inc. (Manhattan); Ping An Millennial women repro- ■ New York Times Co. ters from 2 Park Ave. e Ventures; Quan Capital; So nnova ductive advice and oocyte- (NYT-N) asking rent was from $85 Ventures Inc.; Taiho Ventures LLC preservation services, also Robert Anthony Benten, to $103 per square foot. Harpoon Therapeutics Inc. $70 Arix Bioscience PLC; Cormorant GCI known as egg-freezing. e senior vice president and Cresa handled the deal for Asset Management LLC; Lilly Asia clinic’s nancing options treasurer, sold 11,015 the tenant. CBRE brokered Ventures; MPM Capital; New Leaf Venture Partners LLC (Manhattan); start at $281 a month. shares of common stock for the landlord, Brook eld NS Investment; OrbiMed Advisors for $27.67 per share Nov. Property Partners. LLC (Manhattan); Ridgeback Capital Management LLC (Manhattan); ■ Whistles 8 in a transaction worth Taiho Ventures LLC 150 Spring St. $304,822. He now holds ■ Friedman LLP signed e British womenswear 39,906 shares. a 10-year deal for 44,767 Clear Finance Technology Corp. $69.6 Berggruen Holdings Inc.; Eight GCI Partners; Emergence Capital Partners; 1 Liberty brand known for dress- square feet at FJ Labs (Manhattan); Founders ing Duchess Catherine of ■ Estée Lauder Cos. Inc. Plaza. e accounting Fund; iNovia Capital; Portag3 Cambridge opened its rst (EL-N) rm plans to move from Ventures LP; Precursor Ventures; Real Ventures; Social Capital stateside store, in SoHo. General Counsel Sara Moss 1700 Broadway. Newmark
sold 11,404 shares of com- Knight Frank represented Selected deals announced for the week ending Nov. 15 involving companies in metro New mon stock for $141.89 per the tenant. e landlord, York. “SB M&A”: Strategic buyer M&A represents a minority or majority acquisition of exist- MOVES AND EXPANSIONS share Nov. 7 in a transac- Brook eld Property Part- ing shares of a company without the participation of a financial buyer. “FB M&A”: Financial buyer M&A represents a minority or majority acquisition of existing shares of a company tion worth $1,618,113. She ners, was represented by an with the participation of a financial buyer. “GCI”: Growth capital investment represents new ■ Ample Hills now holds 71,946 shares. in-house team. e asking money invested in a company for a minority stake. SOURCE: CAPITALIQ 141 Eighth Ave. rent was $62 per square e Brooklyn-based foot. scoop shop expanded to REAL ESTATE
■ GET* YOUR NEWS ON THE RECORD Chelsea, where it debuted Jerusalem Venture To submit company openings, moves or real estate deals, or to receive further information, Chelsea Morning, a vanilla RETAIL Partners took 26,400 square ABOUTemail [email protected] SECTION . ice cream packed with ■ e Compleat Sculptor feet at 462 Broadway. e For the Record is a listing to help businesspeople in New York nd opportunities, potential Italian rainbow cookies and inked a 10-year deal for Israel-based venture capital new clients and updates on customers. Bankruptcy lings from the eastern and southern 110 named a er the Joni Mitch- 13,500 square feet at rm plans to occupy part districts of New York are listed alphabetically. Stock transactions are insider transactions at ell song. is is the chain's W. 19th St. e arts and of the ground oor and New York companies obtained from Thomson Reuters and listed by size. Real estate listings rst shop with indoor cra s supply store plans to the entire second and third are in order of square footage. seating and ice cream cakes. move from 90 Vandam St. oors of the building. e
22 | CRAIN’S NEW YORK BUSINESS | NOVEMBER 26, 2018
P022_CN_20181126.indd 22 11/21/18 4:53 PM PHOTO FINISH
Sprucing up urkey le overs are barely tucked away when the annual crush of decorated Christmas trees starts to adorn city sidewalks. Among them will be this 72-foot-tall Norway spruce Tcurrently being fussed over in preparation for its Nov. 28 lighting in Rockefeller Center. But shoppers in the market for their own tree may notice evergreens are in short supply again this year. e national shortage of trees is due to the Great Recession of 2008, when consumers tightened their belts and many farmers quit the business, radically reducing the number of trees that were planted. Fraser rs, the quintessential Christmas variety, take a decade to reach selling height. As a result, the impact of the scarcity rst hit last year and will continue for a several more. While farmers work to catch up with demand, shoppers will have to be more exible about sizes and prices. Harold DeLucia, owner of Tyler’s Trees and NYC Trees, said e-tailers delivering rs and balsams throws another wrench in the tree economy. But he believes his company has an edge in this market. “Amazon is putting 6-foot trees in a box for $110,” DeLucia said. “But we do the full service: providing the stand, the delivery and the installation for $169.” — GABRIELLA IANNETTA BUCK ENNIS
NOVEMBER 26, 2018 | CRAIN’S NEW YORK BUSINESS | 23
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