Crain's New York Business

NEW YORK BUSINESS City and state squeeze nonprofits P. 6 | Build more without spending a dime P. 8 | Don’t worry about Wall Street’s decline P. 10 CRAINS NEW YORK BUSINESS® NOVEMBER 7 - 13, 2016 | PRICE $3.00 TOUGH MEDICINE It’s never been harder for doctors to own and operate their small practices. Six providers describe the hard choices they’ve made PAGEPAGE 1616 VOL. XXXII, NO. 45 WWW.CRAINSNEWYORK.COM NEWSPAPER P001_CN_20161107.indd 1 11/4/16 7:47 PM Welcome to the Majors Rockefeller Group is proud to announce the signing of a lease with Major League Baseball for 400,000 sf in 1271 Avenue of the Americas. Thank you to the CBRE brokerage team that represented Major League Baseball. Scott Gottlieb Ken Meyerson Chris Corrinet Brendan Herlihy Daniel Wilpon www.1271AoA.com We’re looking to add more world-class businesses to the roster in the newly renovated 1271 Avenue of the Americas. For information, please contact: Mary Ann Tighe John Maher Howard Fiddle Evan Haskell 212 984 8000 212 984 8008 212 984 6525 212 984 8049 [email protected] [email protected] [email protected] [email protected] Sarah Pontius David Caperna 212 984 7196 212 656 0530 [email protected] [email protected] Ed Guiltinan Jennifer Stein Taku Tanikawa 212 282 2018 212 282 2120 212 282 2119 [email protected] [email protected] [email protected] NOVEMBER 7 - 13, 2016 CRAINSNEW YORK BUSINESS FROM THE NEWSROOM | JEREMY SMERD IN THIS ISSUE Small A less crowded subway 4 AGENDA theater 5 IN CASE YOU MISSED IT companies A SIMPLE TECHNOLOGY upgrade that is widely used by transit get a new 6 NONPROFITS venue on systems the world over is all that stands between you and a the cheap far less crowded subway. So said Metropolitan Transporta- 7 ENTERTAINMENT tion Authority Chairman Tom Prendergast at our “Getting 8 REAL ESTATE Ready for 9 Million New Yorkers” conference last week. 9 ASKED & ANSWERED Communications-based train control uses computers, 10 VIEWPOINTS not humans, to identify where trains are at any moment, al- 14 THE LIST lowing them to run more closely together. The results can be transformational. Today, our stations see no more than 26 to FEATURES 28 trains per hour. New signals could increase throughput 16 TOUGH MEDICINE by as much as 50%. “With communications-based train Politicians don’t control they’re getting up to 36 and 39 trains per hour in see a benefit in London, something that was unheard of 10 to 15 years “ ago,” Prendergast said. spending money Unfortunately, that optimism is not matched by reality. to fix what you’ve The MTA chief said upgrading the signal system would already got cost $4 billion—chump change in the context of a system with a five-year capital plan of about $26 billion. But that doesn’t include the cost of upgrading switches and stations to accommodate more P. 16 trains. “Every line has different constraints,” said Rich Barone of the Regional Plan DR. PATRICIA MCLAUGHLIN Association. “Some lines are better positioned to take advantage of the technology.” The L train, for example, already has the new signals, but the line can handle only 20 25 GOTHAM GIGS trains per hour because of bottlenecks that occur at the terminus, where there’s not 26 SNAPS enough room to turn around. The RPA has estimated that it would cost $20 billion 27 PHOTO FINISH to make all the necessary systemwide upgrades. CORRECTION The problem, as New Yorkers know all too well, is political will. “Politicians don’t The Rudin Organization ranks 13th on the list of see a benefit in spending money to fix what you’ve already got,” said fiscal watchdog the largest commercial property managers in New and panelist E.J. McMahon. “That’s not fun to spend money on.” York City, published Oct. 31. The state has in the past two years received $8.7 billion from banks that have paid fines to settle legal troubles. But only $200 million went to public transit. Instead, Gov. Andrew Cuomo allocated $2 billion to the Thruway Authority; $1.7 billion to the Upstate Revitalization Initiative, a program modeled on the now infamous Buffalo Billion, which is under federal investigation for how the state awarded con- tracts; and $250 million to rehab Penn Station, a worthy goal if only the governor’s plan offered more than just a cosmetic upgrade. ON THE COVER The MTA at one point said it would take 100 years to implement communica- PHOTOS: BUCK ENNIS tions-based train control. The RPA has outlined a more aggressive timetable for the new signal system: 30 years. Both are far too long to wait. The city needs less crowded subways now, not when we’re well on our way to 10 million New Yorkers. DIGITAL DISPATCHES Go to CrainsNewYork.com CONFERENCE CALLOUT NOVEMBER 14 n Bridget Kelly and Bill Baroni, former aides Crain’s Hall of to New Jersey Gov. > Fame Luncheon Chris Christie, were JOIN THIS YEAR’S INDUCTEES, convicted on all including Geoffrey Canada, counts last week for for a luncheon honoring their involvement in the their contributions Bridgegate scandal. to New York’s n Virtual reality is coming to the Westfield business and World Trade Center mall. Visitors will have civic life. free access to eight 360-degree viewing THE PLAZA stations through Nov. 20. HOTEL n A trove of personal items once be- Noon to 2 p.m. longing to Alexander Hamilton will be [email protected] auctioned by Sotheby’s in January. The collection, which includes love letters to Vol. XXXII, No. 45, November 7, 2016—Crain’s New York Business (ISSN 8756-789X) is published weekly, except for his wife, Eliza, and a lock of his hair, had double issues the weeks of June 27, July 11, July 25, Aug. 8, Aug. 22 and Dec. 19, by Crain Communications Inc., 685 Third been handed down by his family. One doc- Ave., New York, NY 10017. Periodicals postage paid at New York, NY, and additional mailing offices. Postmaster: Send address changes to: Crain’s New York Business, Circulation Department, 1155 Gratiot Ave., Detroit, MI 48207-2912. For ument detailing Hamilton’s appointment subscriber service: Call (877) 824-9379. Fax (313) 446-6777. $3.00 a copy, $99.95 one year, $179.95 two years. (GST No. as Gen. George Washington’s aide- 13676-0444-RT) ©Entire contents copyright 2016 by Crain Communications Inc. All rights reserved. de-camp could fetch up to $250,000. BUCK ENNIS NOVEMBER 7, 2016 | CRAIN’S NEW YORK BUSINESS | 3 P003_CN_20161107.indd 3 11/4/16 7:49 PM WHAT’S NEW NOVEMBER 7, 2016 AGENDAWhen police padlock businesses without due process bout once per day, the Police Department hits a small business somewhere in New York City with a nuisance abatement action. For store owners, though, it is often far more than a nuisance. Their establishments can have restraining orders Aor even padlocks slapped on the front door by the NYPD for minor infractions committed on the premises—even if the culprits were nei- ther employees nor customers. Judges commonly approve these punishments without the merchants being notified, let alone given a chance UNEQUAL Nine to respond. of 10 nuisance The practice stems from a law passed nearly four decades ago to abatement actions occur close houses of prostitution. The statute was not intended to shut down, in minority for example, a laundry just because a loiterer there buys a purportedly neighborhoods. stolen laptop from an undercover cop. But that is exactly what the Daily News and ProPublica found was happening during a joint investigation that it took an examination by journalists to get mom-and-pop shops that was detailed in the spring. some protection after years of overzealous enforcement. Stores should The story got the City Council’s attention. Last week a council com- never be closed for alleged nuisance violations before the owners are mittee held a hearing on a bill to prevent police and judges from inflict- alerted or given a chance to respond. The NYPD claims that imminent ing draconian punishments and ignoring danger required the shut-downs, but the due process under the 1977 statute. Legislation would right a decades-old analysis found that police sat on cases for The new legislation would prohibit an average of five months before acting. So police from ganging up on a business wrong that assumes business owners much for urgency. already being charged for similar conduct are guilty until proven innocent Also troubling is that the probe found by a different agency such as the state 90% of nuisance abatement actions were Liquor Authority. It would require that in minority neighborhoods. When the defendants be notified before being evicted. And it would prohibit the NYPD routinely sends mature-looking 20-year-olds into bodegas to closing of a business for illegal activity of which the owner was unaware. buy beer but never tests wine shops, it perpetuates the widely held Those are reasonable and necessary reforms. Police officials say they belief that the law is not equally applied across the city. But, for mer- support them in concept but are negotiating to keep some powers. chants at least, the bigger problem is when the law is applied unjustly. Although the prospects for an agreement seem good, it is unacceptable That must stop. — THE EDITORS FINE PRINT Mayor Bill de Blasio last week banned city agencies from asking prospective employees about their salary history. The mayor said the goal is “to ensure fair employment practices and close the pay gap for women and people of color.” But the practical impact will be limited because 90% of the city workforce is unionized and is paid based on collective bargaining agreements.

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