20120611-NEWS--0001-NAT-CCI-CN_-- 6/8/2012 8:06 PM Page 1 INSIDE Sin City: Pot, HEALTH CARE pop and Local ponies, hospitals by the suffer growing ® numbers pains PAGE 3 PAGE 2 Plus: NY’s top VOL. XXVIII, NO. 24 WWW.CRAINSNEWYORK.COM JUNE 11-17, 2012 PRICE: $3.00 hospitals list PAGE 16 Greg David: Why city’s med centers must merge or die PAGE 11 Meet two of the busiest property buyers in town PAGE 3 Brooklyn Heights morphs into retail hot spot NEIGHBORHOODS, PAGE 7 john kuczalajohn ALL BETS ARE ON a massive development project that will include a Cuomo’s gambling reversal gives Javits Las Vegas-style casino, hotels and retail along the BUSINESS LIVES Hudson River. The plan is gaining support from shot at hotel, casino jackpot via Pier 76 many corners, including individual members of GOTHAM GIGS Friends of the Hudson River Park Trust. Tourists’ ticket to Jacob K. Javits Convention Center, complete It’s not an entirely new idea—parts of it first exclusive events P. 25 BY LISA FICKENSCHER with a grand casino and luxury hotels. See ALL BETS on Page 5 ● ANNE FISHER How to Earlier this year, Gov.Andrew Cuomo threat- overcome the tech Pier 76 is home to the Police Department’s tow ened to tear Javits down. Now the center’s sup- TAPPAN ZEE TURMOIL Gov. Andrew Cuomo’s talent shortage P. 25 pound and horse stables. But in the near future, porters,and perhaps even the governor,are weigh- other big, troubled public-works proposal Page 5 it could become an extension of the neighboring ing plans to expand the facility and make it part of ● MOVERS & SHAKERS Dewey partner down but not out P. 26 ● GAEL GREENE Hot and IN THE MARKETS spicy at Singapura P. 27 Fashion BID seeks INDEX Volcker rules (on NEW YORK, NEW YORK _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _6 new label THE INSIDER _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _8 REAL ESTATE DEALS _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _9 bank regs, that is) VIEWPOINT _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _10 A changing district SMALL BUSINESS _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _12 wants distance from CLASSIFIEDS Former Fed chief _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _19 BY AARON ELSTEIN FOR THE RECORD its garmento past _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _22 in final push to stop EXECUTIVE MOVES _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _25 banks from betting it Like a lot of people,Paul Volcker is THE WEEK AHEAD _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _27 disgusted with the nation’s bank- BY ADRIANNE PASQUARELLI ing system. The former Federal all with your money newsbloomberg Reserve Board chief isn’t happy PAUL VOLCKER said even bankers don’t The Fashion Center Business Im- that so much business is concen- understand the complexities of banking. provement District has worn its trated in a handful of giant banks name proudly for nearly two that he says are too big to properly decades. Yet come 2013, a manage. He’s alarmed that these client relationships to make a fast wardrobe change of sorts will take institutions used their govern- buck on their trading desks. In place. As designers exit the gar- ment-insured deposits to gamble short, says the legendary central ment center, replaced by new ten- on super-risky securities. He’s en- banker who broke the Great Infla- ants including hoteliers and visual NEWSPAPER raged when they exploit long-term See VOLCKER on Page 4 See FASHION on Page 24 20120611-NEWS--0002-NAT-CCI-CN_-- 6/8/2012 8:06 PM Page 1 IN BRIEF NEW YORK’S HEALTH CARE ECONOMY STRAUSS DISCOUNT AUTO’S 580 EMPLOYEES FOUND THEMSELVES JOBLESS LAST WEEK when the auto supply and service retailer suddenly shuttered its 19 stores across the city Hospitals suffer growing pains and its remaining 27 shops in New Jersey and Pennsylvania.The South River, N.J.-based company filed for bankruptcy and is looking for BIGGEST GAINERS hospitals face growing governmental a buyer. “The assets and stores are being heavily Costs grow 6.3% as pressure to cut costs by treating patients marketed,” said Eric Horn, an attorney Percentage change in operating outside the very place that traditionally representing Strauss. He said “a combination of med centers face expenses, 2010 to 2011 generates income: the inpatient bed. factors” led First Niagara, the company’s senior The cost constraints have led to a lender, to cease funding, but would not merger pressures NYU Langone wave of consolidation. The latest exam- elaborate.The company has filed for Chapter 11 +17.5% ple came last week,when NYU Langone at least three times since 2006. It once operated BY GALE SCOTT North Shore University Hospital and Continuum announced the possi- 110 stores but had only 46 at the latest +10.0% bility of a merger. If Continuum’s acute- bankruptcy filing, including nine in Brooklyn Hospital spending in New York’s crowd- care facilities (Beth Israel Medical Cen- and six in Queens. Website Sheepshead Bites ed, competitive health care scene keeps St. Barnabas Medical Center ter, St. Luke’s-Roosevelt Hospital and first reported the story. growing, pumping billions of dollars +9.7% New York Eye and Ear Infirmary) were into the local economy. But that hasn’t Memorial Sloan-Kettering combined with NYU Langone, it would FOUR RUNDOWN, OVERLEVERAGED made hospitals healthier. +8.6% be the largest hospital in the city. Their MULTIFAMILY BUILDINGS IN THE BRONX Expenses at the top 25 hospitals in merger talk has not surprised industry received an injection of much-needed capital the New York metropolitan region Hospital for Special Surgery analysts, who have long predicted fur- courtesy of a new owner, Workforce Housing reached $24.4 billion in 2011, up from +8.6% ther hospital consolidation here. Advisors Inc. Morgan Stanley will provide $7.5 $22.9 billion in 2010, a 6.3% increase, “Market forces are definitely picking million in interim financing to help start the according to Crain’s annual ranking of up where the Berger Commission left rehabilitation of the Creston Avenue buildings, the area’s largest hospitals (page 16). are due to a rise in patient volume. But off,”said David Sandman,who served as which have piled up code violations and liens. For some, like the Hospital for Spe- for many, the increase has not been the executive director of the state panel The money will be used to pay down the cial Surgery, bigger operating expenses matched by an equal uptick in revenue as See HOSPITALS on Page 24 $750,000 in outstanding property taxes, municipal liens and repair bills that the previous owners amassed, according to Workforce founding partner John Crotty. His firm initially bought the note on the buildings, which total 120 units, and foreclosed on them earlier this Everyday Health closes in on year. BY THE NUMBERS WebMD’s online dominance Weekly shift of the city’s economy HOME SWEET HOME Last week brought signs of Brooklyn-born firm is a recovery in house construction as well as the first cut in Chinese interest rates in four years and now No. 1 in traffic and hopes that other central banks would follow suit. expects to take revenue 19% $3,438 6.4% lead within five years U.S. ADULTS AVERAGE RISE IN paying using helmets all monthly May rent passengers flying BY MATTHEW FLAMM or most of the in Manhattan, through NY area time riding a bike an all-time high airports in 1Q, vs. Source: Centers for Source: year earlier The past few months have been busy Disease Control and Citi Habitats Source: Port ones for health information Web prop- Prevention Authority of NY & NJ erty Everyday Health. Its debut TV ef- fort, Everyday Health, was nominated HOMEGROWN NYC developers have been racking up for an Emmy—a first for a show from a permits for residential housing units pretty steadily for the digital company.