CO-WORK COPYCATS Wework’S Growth Into an Office-Sharing Juggernaut Has Spawned Scores of Imitators Hoping to Cash in on a Boom Before It Goes Bust PAGE 16
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20160502-NEWS--0001-NAT-CCI-CN_-- 4/29/2016 7:53 PM Page 1 CRAINS ® MAY 2-8, 2016 | PRICE $3.00 NEW YORK BUSINESS CO-WORK COPYCATS WeWork’s growth into an office-sharing juggernaut has spawned scores of imitators hoping to cash in on a boom before it goes bust PAGE 16 VOL. XXXII, NO. 18 WWW.CRAINSNEWYORK.COM Springtime in THE LIST TWO the city means Top real estate MAKERS, municipal financings ONE budgets bloom P. 14 P. 7 WINNER P. 1 5 0 71486 01068 5 18 NEWSPAPER WE’RE BUILDING THE FUTURE... AND DRAWING A CROWD 55 Hudson Yards welcomes Milbank, Tweed, Hadley & McCloy LLP to our growing roster of iconic brands and industry leaders. HOME TO DEVELOPED BY Exclusive Leasing Agent 20160502-NEWS--0003-NAT-CCI-CN_-- 4/29/2016 8:21 PM Page 1 MAYCRAINS 2-8, 2016 FROM THE NEWSROOM | JEREMY SMERD Ticket selling run amok IN THIS ISSUE 4 AGENDA NOT LONG AFTER I WROTE in February about downtown ticket 6 IN CASE YOU MISSED IT sellers’ assaulting one another, as well as tourists, the city 7 POLITICS NYU’s new stepped up enforcement of a ban in Battery Park on selling 8 WHO OWNS THE BLOCK president wants tickets to cruises and other attractions. to make the 9 ENTERTAINMENT school more “The NYPD initiative has had great success,” said affordable 10 ASKED & ANSWERED Michael Burke, COO of Statue Cruises, which is the 11 exclusive franchise to take tourists to the Statue of Liberty. RETAIL But it’s not been without consequences. “Enforcement 12 VIEWPOINTS out of the Battery has shifted the 13 VIEWPOINTS problem,” said Alliance for Downtown New York Legislation making 14 THE LIST President Jessica Lappin, who noted that the touts have moved outside 7 World Trade Center and the Staten its way through FEATURES Island ferry terminal. “Come July the numbers are going the city council 15 TALE OF TWO MAKERS to expand greatly.” is unikely to solve Ticket selling is a street-corner trade. Ban one side of the 16 CO-WORKING COPYCATS street and you flush sellers to the other. This is why the problem 21 GOTHAM GIGS legislation making its way through the city council is 32 EXECUTIVE MOVES unlikely to solve the problem. Councilman Daniel Garodnick believes his bill 33 SNAPS proposing that ticket sellers be licensed (and wear identifying vests) would give the 34 FOR THE RECORD police and tourists a tool to weed out bad actors. That’s good. At a minimum, anyone without a license will be banned from selling on the street. But simply 35 PHOTO FINISH legitimizing a practice that is already meddlesome may also exacerbate the problem. “They’ll be like a plague of locusts all over Bowling Green,” Burke said. That’s because Garodnick has agreed to reduce the licensing fee, but he does not plan to cap the number of licenses or limit how many ticket sellers can occupy a P. 21 single street corner. “That’s something we are looking at doing,” he said. MICKEY ASHMORE The Department of Transportation will regulate vending in pedestrian plazas. CORRECTIONS The council wants the Department of Consumer Affairs to identify hot spots and Stifel Financial Corp. Assistant vice president MARY SLIWA problem areas and to come up with rules that would address them. “It’s a first attended an April 13 benefit for the New York City Mission step toward trying to get a handle on what’s obviously become a real issue,” Society. Her last name was misstated in Snaps published April 25. Garodnick told me. Licensing is tricky business. The proposed bill wants to give job opportunities to New Yorkers on the lower end of the income scale, but the legislation would also legitimize vending that many find annoying on already busy sidewalks. Capping licenses would solve the problem of overcrowded and emotionally heated street turf, but it will invariably create a secondary market in which permits will trade for tens of thousands of dollars, as they do for food carts. It’s hard to see how those ON THE COVER two goals can coexist. The bill as proposed may give police another enforcement ILLUSTRATION BY: HANNA BARCZYK tool, but it may also set this issue on a collision course. DIGITAL DISPATCHES CONFERENCE CALLOUT May 24 Go to CrainsNewYork.com READ CRAIN’S BUSINESS Uber reached a deal OF GAMING with Newark Liberty Airport that preserves its access. Join us as we handicap the issues Drivers will wait for ride > facing the state’s casino industry, requests in an off-airport lot which is expanding thanks to and will not be permitted to changes in state law stand in areas set aside for but faces potential competition taxis to pick up passengers. from across the Hudson River in northern New Jersey. Milbank Tweed Hadley & McCloy has com- mitted to taking 250,000 square feet at 55 JOHN JAY COLLEGE OF Hudson Yards, a 51-story tower being built by CRIMINAL JUSTICE Mitsui Fudosan, Related Cos and Oxford 8:30 a.m. to 10 a.m. Property Group. The firm is the second tenant [email protected] to sign on for space at the $1.4 billion tower. LISTEN to this week’s podcast, featuring Vol. XXXII, No. 18, May 2, 2016—Crain’s New York Business (ISSN 8756-789X) is published weekly, except for double issues Neelam Brar, a co-working entrepreneur, the weeks of June 27, July 11, July 25, Aug. 8, Aug. 22 and Dec. 19, by Crain Communications Inc., 685 Third Ave., New York, NY 10017. Periodicals postage paid at New York, NY, and additional mailing offices. Postmaster: Send address changes and a discussion about politics and to: Crain’s New York Business, Circulation Department, 1155 Gratiot Avenue, Detroit, MI 48207-2912. manufacturing. CrainsNewYork.com/podcast 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) BUCK ENNIS, BLOOMBERG ©Entire contents copyright 2016 by Crain Communications Inc. All rights reserved. MAY 2, 2016 | CRAIN’S NEW YORK BUSINESS | 3 20160502-NEWS--0004-NAT-CCI-CN_-- 4/29/2016 7:48 PM Page 1 AGENDAWHAT’S NEW MAY 2, 2016 Legal or not, the mayor’s fundraising is dragging him down—and he knows why ayor Bill de Blasio is doing all kinds of wonderful things—just ask him. He’s rescuing the public hospi- tals from financial ruin. He’s slashing homeowners’ water bills by $183. He’s building shelters for helpless, BAD IDEA: Using loop- Mabandoned pets. holes to avoid But all anyone wants to talk about is the mayor’s fishy fundraising. contribution limits does not That’s what happens when you’re being investigated by a U.S. inspire public attorney, a district attorney, a board of elections and the entire City confidence. Hall press corps. It’s unfair, the mayor says. After all, everything was done by the create a nonprofit that collected $4 million, ostensibly to support his book, and besides, he agrees the law should be changed to get big agenda. It ran TV ads promoting his already popular prekindergarten money out of politics. But until then, he has no choice but to abuse the program. But most of the money went straight back to the consult- system because his enemies are, too. ants, who profited from de Blasio’s fundraising prowess as the most Sorry, Mr. Mayor. That doesn’t fly. powerful man in city government. Even if the probes conclude that de Blasio and his bagmen didn’t Whatever public support the mayor reaped from the Campaign for quite cross the legal line, the public’s faith has been eroded. People One New York was wiped out, and then some, by the tawdry appear- don’t like when their leaders do an ance it created. His fundraising efforts end run around campaign-finance De Blasio says he’d “like to believe for upstate Democratic state Senate can- laws meant to deter quid pro quos. people are making donations because didates in 2014 backfired, as well—they The mayor knows donors give to all lost, in part because their association curry favor. “In theory,” he said, they think someone would be a good with de Blasio disturbed voters. Senate “you’d like to believe people are leader.” But no one does believe that Republicans, who kept control of the making donations because they chamber, have been hostile to him ever think someone would be a good leader.” We’d like to believe in fairy since. And prosecutors are scrutinizing his evasion of donation limits. godmothers, too. But when public unions seeking contracts, develop- As the mayor’s nonprofit became a liability, he shut it down, say- ers seeking approvals and advocates seeking legislation answer the ing it had achieved its goals. That’s spin, of which New Yorkers have mayor’s cash call, their motivation is clear: Money buys access and had quite enough. De Blasio should tell the truth about why special goodwill in City Hall. interests give, and stop taking their massive checks. Now, that would Upon his election, the mayor had his favorite political consultants change the conversation.– THE EDITORS FINE PRINT The erosion of mid- and high-wage jobs means the generation defined as 19- to 30-year-olds earned about 20% less in 2014, adjusted for inflation, than their counterparts who entered the job market during the 1990s, according to a study by city Comptroller Scott Stringer. The report found that the average working 23-year-old in New York City earned $23,543 in 2014, compared with $27,731 in 2000, adjusted for inflation.