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INSIDE What TOP STORIES Bloomberg won’t say Hedge funds face Greg David serious trimming on the city’s rocky finances in brave new world ® Page 11 PAGE 2 The comeback of Eliot Spitzer. Are VOL. XXV, NO. 22 WWW.CRAINSNEWYORK.COM JUNE 1-7, 2009 PRICE: $3.00 you kidding? THE INSIDER, PAGE 12 Real estate Price cuts revive PLUS SIZES hopes for tourism minnows this summer prep attack PAGE 5 A FASHION SPECIAL REPORT on Big 3 VICTIM Goal: Grab leaders’ business when More designers, market rebounds -.6%DECREASE IN BY THERESA AGOVINO PETITE-SIZE SALES stores cut lines IN 2008 amid the devastating deal BY ADRIANNE PASQUARELLI drought in the commercial real es- CRAIN’S TOP SIX tate business, brokerages—espe- ENTREPRENEURS attention, plus-size shoppers, your cially small and midsize firms—are G Dry cleaner expands her fashion options are getting fewer by the day. remarkably busy. Sure, office leas- reach in 2 boroughs P. 13 Larger sizes are among the latest victims ing swooned to a 25-year low in G Furniture designer builds of the recession, with the retail industry the first quarter, and sales of Man- cutting them on all fronts. Well-known hattan buildings fared even an Amazon for crafts P. 14 -2%DECREASE IN G STANDARD-SIZE brands such as Ellen Tracy have eliminat- worse—plunging Banker creates market for ed or downsized production, and depart- 70% in the first hard-to-trade paper P. 14 SALES IN 2008 ment stores like Bloomingdale’s have re- four months of G Former journalist becomes duced space for the lines or dropped them this year, accord- toast of Brooklyn P. 14 70% altogether.In the spring season,Ann Tay- ing to Cushman DROP in sales G Chef rolls up successes in lor eliminated size 16 from its namesake & Wakefield Inc. of Manhattan the sandwich trade P. 16 and Loft divisions. It now sells sizes 16 Yet firms are buildings in first four months G Ex-city official traffics in and up only online. adding brokers, of 2009 getting results P. 17 “It’s almost as if certain retailers have expanding prod- said, ‘I’ll worry about losing these cus- uct lines and -8%DECREASE IN tomers later on,’ ” says Andrew Jassin, man- boosting training, intent not just BUSINESS LIVES PLUS-SIZE SALES aging director of retail consultancy Jassin- on surviving but on challenging FRANCHISE FEVER IN 2008 O’Rourke Group. the industry’s leaders when the But the average American woman weighs market finally snaps back. Laid-off 164 pounds and sports a size 14,according to So far this year, for example, New Yorkers the latest statistics from the Centers for Dis- FirstService Williams has already with the ease Control and Prevention. How can fash- hired nine employees in Manhat- means try ion and retail abandon so many customers? tan, including a head of research to take For one, plus-size collections are expen- and seven brokers. The moves control See RECESSION on Page 7 See SMALLER FIRMS on Page 8 of their

own getty images destinies PAGE21 Defying odds, FreshDirect delivers gains INDEX Online grocer emerges from troubles IN THE MARKETS ______4 NEIGHBORHOOD JOURNAL ______9 with stronger sales, fewer complaints VIEWPOINT ______10 umented workers, and the compa- CRAIN’S POLL ______11 BY LISA FICKENSCHER ny was fending off a labor organiz- REAL ESTATE DEALS ______18 ing campaign. CLASSIFIEDS ______19 last year, FreshDirect was a Now, in the midst of a deep re- CORPORATE LADDER ______23 company in crisis.The federal gov- cession, the Long Island City,

EXECUTIVE MOVES ______23 ernment was investigating wheth- Queens-based grocer can boast a er the online grocer hired undoc- financial turnaround. It has spent the past year honing its technolo-

22 gy and developing loyalty pro-

5 grams that have helped it become solidly profitable for the first time in its six-year history.The compa- THE TRUCK STARTS HERE: ELECTRONIC EDITION ny even plans to hand out year-end CEO Richard Braddock wants bonuses to salaried employees. to add to FreshDirect’s “We are running the business 35,000 frequent users. NEWSPAPER

See FRESHDIRECT on Page 8 buck ennis 71486 01068 0 20090601--A--0002-MAIN-CCI-CNYB--CRAINS NEW YORK BUSINESS MAIN (REGULAR) PUBLICATION 5/29/2009 8:17 PM Page 1

IN BRIEF Hedge funds face THE RECESSION IS WEIGHING HEAVILY ON THREE NEW YORK CITY RETAILERS. CLOTHIER Oilily USA, restaurant Zoë in SoHo and furniture chain Door Store all filed for Chapter serious trimming 11 bankruptcy protection last week. All plan to restructure for survival. Oilily, which has already shuttered eight stores, including its Madison Avenue shop, aims to renegotiate its Managers try to survive by cutting remaining 25 leases across the country. Zoë’s owner is drumming up another round of fees and imposing lockup periods financing and pleading for leniency from his landlord. Door Store has yet to close any of its $253 billion in the six months end- five city showrooms, but parent company BY AARON ELSTEIN ed March 31, 2009, driving hedge Furniture-In-Parts Corp. listed liabilities of fund assets to $1.3 trillion—rough- more than $1 million. for years, dan loeb was the hedge ly half of last year’s peak. fund world’s hanging judge, firing off Shell-shocked survivors are BRUCE RAYNOR HAS RESIGNED AS PRESIDENT blistering letters to hapless chief execu- fighting to hold on to what they’ve OF NEW YORK CITY-BASED UNITE HERE, TWO tives that condemned them for their got. More than 30% of funds have weeks after he was suspended by the union’s shortcomings. taken the draconian step of barring general executive board as a result of an ongoing “Do what you do best,” he hissed in a the door and restricting investor BIG CRASH: civil war that has torn apart the organization of 2005 letter to a soon-to-be-gone CEO. withdrawals, according to Bern- Dan Loeb’s garment and hotel workers. Mr. Raynor will “Retreat to your waterfront mansion in the stein. Third Point assume a leadership position in Workers United, Hamptons. ... The matter of repairing the “The question is,how forgiving hedge fund a new union of 150,000 workers that split from mess you have created should be left to are investors going to be?” says recorded a 33% loss Unite Here and affiliated with the powerful professional management.” Marc Freed, a managing director last year. Service Employees International Union. How times change. After years of post- at Lyster Watson & Co., a firm ing average gains of that picks THE RELATED COMPANIES PLANS TO BUILD A 27%, Mr. Loeb’s Third hedge funds 60,000-SQUARE-FOOT SUPERMARKET IN THE Point hedge fund for wealthy

shopping center it is constructing in the crashed to earth last clients. “My mullen IN OUT c Kingsbridge Armory in the Bronx, according to year with a shattering hunch would a recent filing by the developer. Morton Williams 33% loss. In response, be, not very.”

Supermarkets is crying foul because it owns two many investors Some patrick m stores in the immediate vicinity that it expects to grabbed their money managers close if Related is allowed to build its store. and ran, driving assets are trying to make cash to put into these classic hedge fund under management to amends by cutting their plays because banks have hugely scaled WITH THE DEMISE OF MANHATTAN less than $2 billion notoriously high fees or back the money they are willing to lend— BROKERAGE COLDWELL BANKER HUNT from more than $5 bil- by relaxing lockup peri- hugely reducing hedge funds’ leverage and Kennedy reportedly looking more likely by the lion previously. Now ods that can last for profit margins in the process. Some once- day, rivals are seeking fresh new talent. Last it’s Mr. Loeb who’s left years. Ospraie Man- SURVIVAL HOME RUNS lucrative investment strategies that relied week, Halstead Property’s president, Diane to clean things up—or agement, which closed heavily on leverage, such as convertible Ramirez, hosted a cocktail party at her Upper face oceanfront exile. SPIN: LIVE TO FIGHT AGAIN a big commodity fund bond arbitrage, have all but disappeared. East Side apartment for 50 CBHK brokers. “As our assets have last year, is opening two Managers across the industry are strug- Ms. Ramirez says Halstead scheduled fallen,” he meekly funds that will charge gling to survive on the strict new diet im- interviews with brokers even before the party. wrote in an April letter investor fees of just 1% posed by their lenders. Manhattan-based Warburg Realty Partnership to his investors, “we of assets and 10% of “Unlevered returns have to be sufficient is also interviewing CBHK brokers. CBHK has have sought to proper- profits. Renowned for a hedge fund manager to stay in the roughly 200 brokers in five offices in ly size the firm on the fund manager Steve game,” Mr. Davis says. “That’s the world Manhattan and Brooklyn.
business side without Cohen of SAC Capital we’re in now.” weakening the infra- has offered to let in- AMTRAK PRIVATE JETS vol. xxv, no. 22, june 1, 2009—Crain’s New York Business structure that we have vestors withdraw their Making artful sacrifices (issn 8756-789x) is published weekly, except for the 1st and 3rd worked so hard to SPIN: THE ACELA AIN'T SO BAD, IS IT? money every three for many hedge fund managers, that week of July, the 1st and 5th week of August, the 4th week of November and the 4th week of December, by Crain Communica- build.” months instead of every means learning to live with less on a person- tions Inc., 711 Third Ave., New York, NY 10017. Periodicals postage Hedge fund man- three years. al level. Last month, Mr. Loeb sold a sev- paid at New York, N.Y., and additional mailing offices. Postmas- ter: Send address changes to: Crain’s New York Business, Circula- agers, the symbols of Others are trying to en-foot-wide egg by artist Jeff Koons for tion Department, 1155 Gratiot Avenue, Detroit, MI 48207-2912. Wall Street’s latest take advantage of the $5.5 million—nearly double the amount he for subscriber service: Call (888) 909-9111. Fax (313) 446-6777. gilded era, are digging demise of their peers paid in 2004 but well below the $6 million $3.00 a copy, $59.79 one year, $109.79 two years. (GST No. 13676-0444-RT) in and fighting for their and are turning their to $8 million that Sotheby’s had predicted. ©Entire contents copyright 2009 by Crain Communications Inc. very survival in a new fortunes He also sold his carriage-house All rights reserved. world of heavier regu- around apartment in the West Village, LOCKUPS NEW FUNDS lation, far less leverage with some though he kept a $45 million and substantially slim- SPIN: HARSH MEDICINE NEEDED big, well- 18% penthouse overlooking Central ECONOMETER mer profits. In the placed wa- Drop in the Park. Mr. Loeb didn’t return a

coming year, up to 25% of all funds are ex- gers. SAC’s Mr. Cohen and call seeking comment.

Weekly shift of the city’s economy. pected to make the ultimate adjustment Renaissance Technologies’ average hedge Adding insult to injury, NOT WHAT WE NEEDED. Interest rates and oil prices   and close shop altogether. James Simons figure to profit fund last year hedge fund managers are gird- are rising as GM and housing are sinking deeper into the toilet. No wonder prime mortgages now account “We’re finding out who really are the re- from bets that Pfizer will com- Source: Hedge Fund Research Inc. ing for an unprecedented on- for the biggest slice of new foreclosures. silient players,” says Rob Davis, head of plete its proposed merger with slaught of new rules and regu- hedge fund service sales at brokerage firm Wyeth. Barry Rosenstein’s lations. For openers, Congress Concept Capital. Jana Partners sees opportunities in buying is expected to soon pass legislation that

POSITIVE NEGATIVE the deeply discounted debt of American would require fund managers to register

  CLOUDY  All too many sprouts General, a consumer lender owned by with the government and disclose some of not long ago, it seemed as if every Wall American International Group. Whitney their investment positions. S Y T Streeter was starting a hedge fund. From Tilson’s T2 Partners reaped a small fortune “If they want to continue to swim in our O N R 1998 through 2008, assets managed by from betting against Wells Fargo as its capital markets,” says Rep. Paul Kanjorski, N M U these largely unregulated vehicles more shares plunged and then switching sides D-Pennsylvania, “they must, at a mini- Y S than quadrupled, to $2.2 trillion, accord- just before the stock rebounded. mum, fill out the forms and get an annual ing to Sanford C. Bernstein & Co.; the Trouble is, most hedge funds have less pool pass.”
number of funds tripled, to 10,000. The allure was simple: Hedge fund -34% +1.9% +4.1% managers typically levy fees equal to 2% of In this fifth installment in our DECLINE in new RISE in durable BLOOMBERG/ assets and 20% of the year’s profits.An elite BRAVE series, Crain’s looks at hedge fund home sales in goods orders in CRAIN’S NY few managers made $1 billion a year. April from April from stock index But last year, the average fund fell 18%, NEW managers struggling to prove a year earlier a year earlier weekly according to Hedge Fund Research Inc., they’re not today’s dot-coms (Commerce Dept.) (Commerce Dept.) change forcing 15% of them out of business. WORLD Frightened investors bolted, yanking out

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CENTRAL PERK A blurry Univision IT’S EASY TO TAKE a public place like Central Park for granted, so the Central Park Conservancy wants to remind people— especially donors—how valuable it is. Olé: Spanish-language Today, the conservancy is releasing its network’s audience soars. first study of the park’s economic impact on New York City, which shows that the Ay, caramba: all that debt. park brings more than $1 billion a year in direct and indirect revenue to the Big BY MATTHEW FLAMM Apple. Broadway’s theater industry, in comparison, contributes $5.1 billion to the economy. in 2006,media entrepreneur Haim Saban won the battle for Univision Communications, The study, conducted by economic edging out Grupo Televisa with a $12.3 billion analysis firm Appleseed, used data from offer. 2007 and early 2008—before the Three years later, advertising revenue has economic crisis. While the dollar amounts plunged, and the Spanish-language media gi- will now be smaller, park officials contend ant has written off $5.4 billion in assets and is that the impact of the park is still the laboring under nearly $10 billion in debt. same relative to that of other revenue- Televisa might have been the winner after all. generators. “When this deal was done, the financing Doug Blonsky, president of the structure presumed a much higher revenue and conservancy, plans to use the report to EBITDA growth rate,” says Heather Good- attract new donors, especially those who child, credit analyst at Standard & Poor’s, live around Central Park. which has given the company a junk rating of “If you live within a 10-minute walk B- with a “negative” outlook. “[Univision] is and invest in the park, you’re making a behind on expectations.” good business decision,” he says. “You But even if they paid too much, Mr. Saban will get your money back [in your real and his backers,which include Thomas H.Lee estate value].” Partners, weren’t wrong about Univision’s ap- —MIRIAM KREININ SOUCCAR peal. The television network has just completed HOW GREEN IS THIS VALLEY? its best season ever. With the help of telenov- APPEALING TO ITSAUDIENCE: Univision scores with telenovelas, the Latin Grammys and variety show Sábado Gigante. elas, the Latin Grammy Awards and variety show Sábado Gigante, Univision grew its CITY TAX REVENUE related to park prime-time audience 11%, to nearly 4 million its explosive growth,the fifth-place network is leveraged buyout and others. operations, visitor spending and viewers, according to Nielsen Media Re- becoming a necessary buy for blue-chip mar- “Clear Channel and Tribune are [highly increased real estate values around the search. Most English-language networks lost keters. leveraged], but what are their growth park total more than $656 million. viewers for the second year in a row. Even analysts who foresee a bumpy ride prospects?” asks Fitch Ratings analyst Jamie And as the Hispanic population continues ahead say there’s a big difference between this See UNIVISION on Page 8 SPENDING by Central Park enterprises and visitors to the park account for $395 million in economic activity.

CONCESSIONS and other businesses The pharmacist’s financier operating in the park, such as Tavern on gust and one in December, totaling $500,000. foot complex in Whitestone.“They don’t need the Green and How drugstore cowboy Mr. Jameron used the money to buy two to go to a bank—I am the bank.” became lending lifeline struggling drugstores in the Bronx, adding to Kinray, the largest independent pharma- the Central his six-store Boca Pharmacy chain. Unlike ceuticals distributor in the country, had rev- Park Zoo, to hundreds of indie owners most small business owners in New York, he’s enue of $5 billion last year, according to Mr. account for not worried about the impact of the credit cri- Rahr, 63, who took over the business from his 1,679 full- sis on his cash flow or ability to replenish in- father 30 years ago. time jobs and BY HILARY POTKEWITZ ventory. “I know I can still get another loan if The sole owner of Kinray,he is ranked No. $135.5 I need one,” he says. 227 in the latest Forbes 400 list of the wealth- million in when cash was at its tightest last year That’s because Mr. Jameron doesn’t go to a iest Americans. “I’m the only wholesaler who economic and banks were calling in credit lines,pharma- bank or the U.S. Small Business Administra- doesn’t borrow money,” Mr. Rahr says. output. cy owner Jacob Jameron did the impossible:He tion. He calls up his pharmaceuticals supplier, Supplying drugs doesn’t pay like it used to, took out two small-business loans, one in Au- Queens-based Kinray Inc., and asks owner however. Margins are thin—in the mid-sin- ONE-FIFTH of Stewart Rahr to lend him gle-digits, according to Morningstar—and Metropolitan Central Park’s Museum of the money. fixed costs are high. Art “A flat market [like now] is a tough time for 25 million Prime plus 1% these companies,”says Helene Wolk,an analyst annual visitors “i can just tell him,‘I need at Sanford Bernstein who covers Kinray’s pub- come from a million; I need $600,000,’ licly traded competitors. She’s bearish on the outside New and we work something out sector, she says, because as drugstores consoli- York City. to pay,” Mr. Jameron says. date, they can demand lower and lower prices. Those visitors Mr. Rahr finances more But that’s actually a bright spot for Kinray. generate more than 200 local pharmacy Independents have neither the leverage nor than $80 owners in an informal the inventory capacity of a CVS or Duane million in arrangement he started sev- Reade. “They need a lot more services than economic Tavern on the Green eral years ago to help a few what a chain pharmacy needs, so they’ll pay activity in the customers expand, acquire the most,”Ms.Wolk points out.“They are the city outside of another drugstore or cover ones that you want in your mix, because they the park. shortfalls. The program has pay your margins.” Central Park Zoo grown to $30 million in Kinray’s mix consists entirely of independ- SUPPLY-SIDE loans, with Mr. Rahr charg- ents. It supplies about 75% of the nonchain THE PARK HAS ECONOMICS: Stewart ing prime plus 1% on loans drugstores in the city,and its customer base of MORE THAN 4,000 days of movie shoots a Rahr supplies some 3,000 independent that generally range from 3,000 pharmacies stretches from Maine to year. The use of the park as a venue for drugstores with $200,000 to $1 million. Delaware. films, TV and professional photography products—and, in “It’s become a small lend- When one of his customers needs capital, generates $135.6 million in some cases, capital. ing business in and of itself,” Mr. Rahr can provide it within a day or two. economic activity for the city. Mr. Rahr says, standing in But his lending style is old-school. “I won’t

buck ennis Kinray’s 400,000-square- See PHARMA on Page 5

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Toys ‘R’ Us seals acquisition IN THE MARKETS of venerable FAO Schwarz by Aaron Elstein

Vows to uphold Though FAO, which D.E. Shaw founder, and senior counsel at the bought five years ago, had a hit last Brennan Center for Justice at New An argument to buy brand; FAO owners year with the Muppet Whatnot York University School of Law.“I’m Workshop,where children designed optimistic they will seek to keep it a (Bank of) America relieved of burden their own puppets for about $130, joyful and exciting experience for the retailer has seen its share of fail- children and adults from all over the ow that Bank of America has passed BY ADRIANNE PASQUARELLI ures such as the Macy’s partnership world.” the government-run “stress test” that and an in-store ice cream parlor. Though Toys “R” Us carries a Neveryone knew it wouldn’t fail, some geoffrey the giraffe will soon be “This was probably one of the hefty debt load—about $5.4 billion investors are beginning to tread back into this taking the place of Tom Hanks tick- only ways to save FAO Schwarz,” in long-term debt—it has been beaten-bloody stock. ling the ivories on a giant keyboard says industry analyst Chris Byrne.“It holding its own through the down- The brave souls include Mark Kingdon, mat as the prevailing image of FAO solidifies Toys ‘R’ Us as the leading turn. Total net sales at the company founder of Kingdon Capital Management, who Schwarz. The move by Toys “R” Us specialty toy retailer in the nation, were down only 0.5% last year, to has been increasing his hedge fund’s holdings in last week to snap up the legendary about $13.7 billion, and it earned such financial stocks as J.P. Morgan Chase, Master- retailer will allow the buyer to ex- $218 million. Card and Chicago Mercantile Exchange parent tend into the upscale, specialty toy ‘It was probably Additionally,Toys “R”Us recent- CME Group, according to a regulatory filing. and catalog market.A sale would rid ly introduced initiatives, such as BofA still has enormous problems looming FAO Schwarz’s owner, investment one of the only highlighting less expensive mer- in commercial real estate, residential mort- firm D.E. Shaw & Co., of a major chandise and staying open 24 hours gages and Merrill Lynch, which the bank only headache. ways to save as Christmas approached. It cur- recently acquired. But Mr. Kingdon reckons Toys “R” Us Inc., based in FAOSchwarz’ rently operates about 1,500 stores, the stock, which trades at less than half of its Wayne, N.J., will continue operat- including a Times Square flagship. book value, is cheap enough to warrant buy- TANK OF AMERICA ing FAO Schwarz’s New York City “We will work tirelessly to pre- ing. BofA stock bottomed out at $2.53 a share and Las Vegas stores, as well as the serve the distinctiveness and in- earlier this spring, but, at about $11 last week, e-commerce and catalog businesses, tegrity of the FAO Schwarz stores still trades 71% below its 52-week high. under that name. But it will discon- and brand as we grow the business Here’s the bull case: The odds of the gov- tinue the brand’s store-within-a- and it adds a jewel in their crown— and, indeed, take [it] to even greater ernment nationalizing BofA are declining, and store operations at Macy’s depart- they’ll get more specialty brands.” heights,” Toys “R” Us Chief Execu- the bank is mostly done diluting shareholders ment stores. Though the Schwarz family sold tive Jerry Storch said in a statement. now that it has raised much of the $34 billion Experts say the acquisition is a the 147-year-old company in the Financial terms of the deal were in new capital deemed necessary by the stress boon for troubled FAO, which de- 1960s, remaining family members not disclosed. FAO Schwarz CEO test. The bank’s fundamentals may not be clared bankruptcy earlier in the are still invested in the brand. Barry Erdos, a veteran of online re- great but are poised to improve. decade and was rumored to again be “I believe it is in Toys ‘R’ Us’ in- tailer Bluefly Inc. who was hired this Mr. Kingdon says BofA can generate “nor- in financial straits during the fourth terest to maintain the brand’s repu- year to replace Ed Schmults, will malized earnings” of $2.24 a share within a quarter. The speculation intensified tation for quality—that’s the only leave FAO. Insiders speculate that couple of years—vastly better than last year’s depressed profits of 59 cents at the annual Toy Fair,held at the Ja- way a store like FAO can succeed,” Mr. Erdos, known for his financial a share but less than half the peak of $4.66 a share reached in 2006. If the cob K. Javits center in February, af- says Frederick A.O.“Fritz” Schwarz rather than merchandising abilities, Federal Reserve can keep bank funding costs low by holding the line on ter a bleak holiday season. Jr., the great-grandson of the was brought on to facilitate a sale.
short-term interest rates, he figures BofA is worth about $20 a share. The difficulty with Mr. Kingdon’s scenario is that it relies on the Fed keeping interest rates low, something that will be tough for policymakers to do amid signs of inflationary pressures building. So without further ado … Brace for inflation, folks money manager Peter Schiff (left), best known for accurately warning in 2007 that the housing bubble’s end was imminent and financial stocks would get savaged, believes the worst is yet to come. With the government borrowing trillions to bail out the financial system, “inflation is going to run out of control,” he warned at a hedge Don’t recognize your banker anymore? fund conference last week. “Prices will go through the roof,” and the dollar will lose much of its value, compared with other currencies. Plenty of money managers agree with Mr. Schiff. Last week, the yield on the benchmark 10-year government bond soared, to about 3.7%, because in- vestors began demanding higher returns to offset the risk that inflation Call us at 212.338.0400 would erode the value of their holdings. Higher borrowing costs for the gov- ernment lead to higher interest rates for companies and consumers alike. High inflation would be bad news for stocks, as well.The Dow Jones Private Banking Team Industrial Average went nowhere during the inflation of the 1970s. Oil Janit Greenwood, Managing Director companies perhaps could benefit from such an environment, should the ris- Dan Nidus ing price of crude exceed inflation rates. Hess shares gained 11% last week. Of course, the government can borrow less by raising revenue, but that Diana Hyde brings pain of its own. As hedge fund manager Jim Chanos observed at the Lisa Reardon same conference where Mr. Schiff spoke, “There will be higher taxes for Stuart Aisenbrey everyone in this room.” AIN’T THAT SOMETHING

A LOT HAS CHANGED since Rupert Murdoch acquired The Wall Street Journal. Most Page 280 Park Avenue, 2nd Floor East One stories are shorter. Coverage of New York, New York 10017 nonbusiness news is often longer. And that mightn’t be all. Since it came into the clutches of its Australia-born owner on Dec. 14, 2007, the Journal has used the oh-so-posh-sounding contraction Offices in New York and Florida mightn’t 173 times, according to search engine Factiva, including three A Member of the Boston Private Wealth Management Group www.gibraltarprivate.com appearances in last Wednesday’s edition alone. Over the same period, The New York Times has used the word four times and USA Today not at all.

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Summer deals keep NYC a tourist trip RECESSION- RESISTANT: Tourists from nearby give expects to host 45 million visitors, already sees that trend playing out in ging a modest resurgence from the the city a lift. Visitors down, but 5% fewer than in 2008. The biggest its online reservations. The hotel depressed levels of recent months. not out; big-spending declines are anticipated amid the chain is getting a big boost from a Occupancy rates climbed to 85% in buck ennis ranks of business and international package it’s offering now through April, just 2 percentage points be- who typically spend the most. In businesspeople give travelers, which are expected to thin Sept. 7 in conjunction with the low April 2008 levels, according to fact, they spend twice as much per by 7% this year. By contrast, domes- AAA, offering club members a 30% PKF Consulting. capita than domestic tourists do. way to local folks tic leisure travelers are expected to discount on stays of three nights. Unfortunately, much of the traf- These days, all kinds of tourism take the recession in stride. Such deals are helping to fill fic comes at the expense of revenue business, from tour bus and boat BY LISA FICKENSCHER “The leisure segment is not hurt- rooms at the Marriott’s 12 proper- and profits. Hotel room rates were companies to Broadway theaters, ing as badly,” says a spokesman for ties in the city. Company officials down 26% in April, to $224.That is are dangling discounts. cheap airfares, half-price hotel NYC & Company. say they expect occupancy rates to $78 below levels of a year ago, PKF “A lot of the criticism we’ve gotten rooms and discounted attractions People who live within driving run in the low 90% range over the Consulting says. Moreover, busi- in the past is that New York City is so appear to be saving the city from distance of the city will be the back- next three months—on par with last ness and international travelers— expensive,” says a spokesman for what would otherwise have been a bone of the summer season, say in- summer’s performance. who are expected to cut back the NYC & Company. “Now the tables washout summer. While the Big dustry executives. Marriott Hotels Hotels citywide are already log- most this year—are also the visitors have turned in favor of consumers.”
Apple won’t be quite as flush with tourists as it was last summer, it cer- tainly won’t be a recession-ravaged ghost town, either. The city’s tourism bureau, NYC & Company,is predicting that more than 12 million visitors will arrive here during June, July and August. That’s just 4% below last summer’s levels, and a far better performance than experts had predicted. “If [visitors] are only off by 4%, that would be amazing,” says Lalia Rach, divisional dean of the Tisch Center for Hospitality,Tourism and Sports Management at New York University. For the year as a whole, the city Pharma financier

Continued from Page 3 750 THIRD AVENUE lend to just anybody,”he says.“I have to know them,we have to have a his- tory.” The relationship between cus- tomer and supplier cum lender is not without pitfalls. The default rate WE ARE PLEASED TO ANNOUNCE over the past three years is “almost zero,” according to a Kinray spokes- woman. When a failure does occur, the company does have recourse,she adds. “We get the merchandise MARCUM & KLIEGMAN LLP back,in addition to getting other as- sets of the owner,such as house,cars, bank accounts, etc.” The merchandise and even the has leased 2 full fl oors for a total of 67,152 rsf store can be sold to other customers. Druggist Gopesh Patel, who owns five stores in Brooklyn and Manhattan, got one of them The tenant was represented by Neal Golden, through such a repossession. Ross Perlman and Lee Brodsky “Mr.Rahr [offered] me the store, of Newmark Knight Frank saying that I was the right one to run it,” says Mr. Patel, who has been a Kinray customer for 15 years.“But I told him that I didn’t have the mon- ey to buy another store, and he said, ‘Don’t worry about the money.’”Mr. Patel repaid the loan on schedule. The relationship works both ways. If Kinray has a special product offer or is trying to unload over- stock, it knows who to turn to. “If I want money, he’ll lend me the money,” Mr. Patel says. “And if 212.594.2700 they have something on promotion, and he asks us to buy it, we’ll buy it.” Mr. Patel says the loans have slgreen.com played a key role in his success. In- deed, his daughter has just graduat- ed with a degree in pharmacology, NEW YORK CITY’S LARGEST OWNER OF COMMERCIAL REAL ESTATE and he’s thinking of buying another store for her to run.

June 1, 2009 | Crain’s New York Business | 5 20090601--A--0006-MAIN-CCI-CNYB--CRAINS NEW YORK BUSINESS MAIN (REGULAR) PUBLICATION 5/29/2009 7:12 PM Page 1

W&H Properties NEW YORK,NEW YORK is pleased to announce that edited by Valerie Block American Bureau of Shipping (ABS)

has leased 12,712 square feet on the entire 42nd fl oor at Gen Art wishing on stars 60 EAST 42ND STREET 60 East 42nd Street he celebrities whose careers Gen Art helped launch are coming together to try to keep the organization from going under. Adrien Brody, Adrian Grenier and Zac Posen Tare just a few of the boldfaced names who are hosting a benefit on June 24 to raise money for the ABS was represented by trendy, 15-year-old nonprofit that Frank Recine and Robin Fisher discovers and promotes emerging of Newmark Knight Frank talent. 100% commission was paid The benefit will include an on lease signing art fair with work donated from more than 60 artists, including Christo and Louise Bourgeois. Officials at Gen Art are expecting more than 1,000 people to attend and hope to raise $250,000 from the

William G. Cohen, Executive VP & Principal benefit.They are trying to raise getty images [email protected] / 212-372-2233 Ryan O. Kass, Director an additional $500,000 from other Puglise, market manager for Clear been placed in all public spaces— [email protected] / 212-850-5475 sources to stay afloat through the Channel New York. All five FM including the elevator banks. summer.The group had $7 million stations in the cluster were pretty The hotel and its 11 city Jonathan T. Fanuzzi, Managing Director in revenue in 2008. much sold out for May.“We hope siblings are also buying many Visit us online at whpropertiesny.com [email protected] / 212-372-2084 With 80% of its income coming it’s a trend,” he says. more cartons of rubber gloves. from corporate sponsorships, Gen Housekeepers are now using a Art has been hit hard by the different pair for each room they recession. Its three biggest STATUESQUE DRINK clean. sponsors, Citibank, American Express and Acura, have all slashed WITH LADY LIBERTY’S CROWN set their budgets, forcing the to open to tourists in July, one Bad Times organization to lay off a third of its downtown hotel is offering a liq- for wine seller staff and put its remaining 27 uid tribute. The Libertini, served employees on a four-day workweek. in the 2 West lounge of the Ritz- so, here’s one reason newspapers “We didn’t expect this Carlton New York Battery are up the creek. Upscale wine recession to be so quick and deep,” Park, mixes citrus vodka, seller Sherry-Lehman cut its $1 says co-founder Ian Gerard. pear liqueur, million ad budget with The New Midori, Blue York Times by 40% this year. And Curaçao and a guess what? It hasn’t made much Good signal splash of lemon. The difference. Revenues are down for radio ads potent potion is topped this year, says Chief Executive with a candy Statue of Chris Adams, but only by about 5%. the market for local radio Liberty swizzle stick. And that’s driven by the recession. advertising may have finally Mr. Adams figures after bottomed out. decades of taking out full pages in According to industry insiders, the paper, most Times readers are some of New York’s top-rated City hotels familiar with the company. So, stations, including WCBS-AM even when the economy turns up, and WLTW-FM, sold out their sanitized he may not restore his budget. inventory for May.“They were with swine flu back in the The question is, where does a turning away business,” says Mark news, city hotels have been taking local merchant turn for a Lefkowitz, media director at measures to protect workers and marketing boost? Mr. Adams tried Furman Roth Advertising Inc. He guests from potential exposure. the Times’ Web site, but wasn’t estimates it has been a year since Worried that the focus could that impressed. “With the paper if stations have sold out. Inventory is switch from students to travelers, a reader puts it down and picks it already “very tight” for June, says companies like Marriott are up again, the ad is still there,” he another media buyer. making their properties nearly as says. “With the Internet, the ads The scenario couldn’t have sanitary as hospitals. “We’ve had a are always changing.” gotten much worse.The Radio pandemic-preparedness plan Advertising Bureau recently dating back to SARS,” says a Contributors: Lisa Fickenscher, reported that nationwide, first- spokeswoman. Matthew Flamm, Miriam Kreinin Souccar quarter ad revenue plunged a At the Marriott record 24%, to $3.4 billion. Marquis Hotel in Times New York stations have Square, for instance, the lowered their already depressed ad employee cafeteria is no rates by as much as 20%, insiders longer self-service. Now say, but there is no question that workers are served their demand is up. food to cut down on “We went through a stretch touching common where even moving the pricing utensils. And sanitizer-

down didn’t [help],” says Joe fluid dispensers have bloomberg news

6 | Crain’s New York Business | June 1, 2009 20090601--A--0007-MAIN-CCI-CNYB--CRAINS NEW YORK BUSINESS MAIN (REGULAR) PUBLICATION 5/29/2009 8:07 PM Page 1

still create for the market. Even fast-fashion retailers Recession’s new fashion victim: plus sizes Forever 21 and Target re- cently began testing Continued from Page 1 Chief Operating Officer Kenneth Plus-size specialty shops, many those specialty offerings. plus-size divisions. sive to make—as much as 10% more Ragland. of which offered trendier styles, are Like Ann Taylor, Banana Re- Those would be aimed at than standard lines, experts esti- Bloomingdale’s moved the plus- also getting squeezed. Designer public and Old Navy have teens and women in their mate—because they require addi- size department at its 59th Street Darren Trentacosta, who estimates moved their larger sizes to e- 20s or early 30s, though, tional fabrics, and special fit models flagship to the third floor from the that there were 900 plus-size bou- commerce. Saks still offers six and would not address the and patterns. basement two years ago, almost tiques around the country at the be- plus-size brands in its stores concerns of middle-aged And with the dismal retail envi- halving its square footage, Ms. ginning of the year,says nearly 25% but has more than 20 on its women simply trying to ronment, stores have to pare back Schuller estimates. The company is of them have closed. Locally, de- Web site.The company says it look good. in a number of areas. Like many also offering fewer lines.Blooming- signer Abby Zeichner’s shops in continues to look for new “There’s nothing OLD NAVY’s other consumers, the plus-size cus- dale’s no longer carries AK Anne SoHo and Roosevelt Field, which products for its Salon Z plus- large sizes are around that has a hip, tomer hasn’t been opening her Klein Plus in its stores but sells the opened just last fall,have shuttered. size departments. available only cool feel to it,”says mod- purse much lately. Sales of such collection on the Web, according to The plus-size future is not com- on the Web. el and spokesperson sizes (generally 16 and over) fell 8% employees. It now stocks only the pletely bleak, however. Some designers stay in game Emme. “There’s a size for the 12 months that ended in group’s standard women’s and petite Because these shoppers prefer to some designers, including category that’s not be- March from the year-earlier peri- collections in stores.Bloomingdale’s buy online,according to industry in- Eileen Fisher and Isaac ing satisfied, and that’s od, when the drop was nearly 4%, declined to comment. siders, retailers are keeping most of Mizrahi for Liz Claiborne, the [plus size].”
according to trend tracker NPD Group Inc. By contrast, sales of regular women’s sizes fell only 2% for the year that ended in March, and the petite sector had just a slight decline. Looking for value under $150, even those full-figured women who are buying won’t splurge. “They’re really bargain shoppers,” says Catherine Schuller, a plus-size America’s Largest expert and former editor at Mode,a magazine for larger women. Many are homemakers who can’t spend Push to Talk Coverage Area. considerable amounts on clothes and are willing to sacrifice their own spending for their families, especial- ly now, Ms. Schuller says. Yours at the push of a button. The fashion standoff comes af- ter a brief period when plus-size Not all Push to Talk is created equal. Switch to Push to Talk from Verizon Wireless, lines were viewed as potentially owner of the nation’s largest Push to Talk Network coverage area, plus get profitable. After years of ignoring America’s Most Reliable Wireless Voice Network. larger women, high-profile design- Hundreds of plus-size boutiques nationwide Add Push to Talk for only $ a month to any Nationwide voice 5 have closed plan and get these great deals!

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June 1, 2009 | Crain’s New York Business | 7 20090601--A--0008-MAIN-CCI-CNYB--CRAINS NEW YORK BUSINESS MAIN (REGULAR) PUBLICATION 5/29/2009 8:26 PM Page 1

FreshDirect delivers turnaround LEASE IS MORE: Continued from Page 1 The company’s growing pains FreshDirect invested in a scan- Robert Freedman (left) and Mark better, in a more sophisticated way,” have also included turmoil within ning device that reads a bar code on Jaccom of says Chief Executive Richard Brad- its top ranks.Last June,in the after- each box, alerting drivers and pack- FirstService Williams dock, who is also the chairman and math of the labor troubles, Mr. ers to missing items before the truck are planning to fourth-largest shareholder in the Braddock took the reins of the com- leaves headquarters.The same tech- compete with the big privately held company. pany from Chief Executive Steve nology also cuts down on late deliv- real estate guys. In 2008, the company generated Michaelson, who was demoted to eries,allowing customer service reps $215 million in sales, and manage- president (Mr. Michaelson has to monitor drivers who get stuck in ment estimates that revenues will since left FreshDirect). Mr. Brad- traffic and dispatch an extra truck to grow to $240 million this year, driv- dock is FreshDirect’s fourth chief help out. en in part by consumers’ larger ap- executive. petite for dining in. A former president of Citibank An extra $5 per order In general, grocery store sales and chief executive of other programs, similar to those have been strong this year,according Priceline.com, Mr. Braddock has used at far larger e-tailers like Ama- to supermarket consultant Burt focused on cultivating stronger rela- zon.com, are meant to entice cus- Flickinger. “FreshDirect should be tionships with FreshDirect’s core tomers to spend more. “Your Fa-

benefiting from more people want- customers.This group, which totals vorites” reminds shoppers of items buck ennis ing to eat at home,” he adds. just 35,000, uses the service about they have purchased in the past, The grocer’s journey once a week and spends as while “You Might Also Like” is an from a wobbly startup much as $160 each time. introduction to a new item. As a re- Smaller firms step up launched after the dot-com 60% FreshDirect now generates sult of these programs, people are bust to an established busi- SHARE of 60% of its revenues from its forking over an extra $5 per order. ness employing 1,800 was revenue from ardent fans, up from 25% a The idea now is to leverage Continued from Page 1 assignments for five buildings in re- FreshDirect’s nearly derailed last year.Fif- most ardent year ago. FreshDirect’s technology to woo come on the heels of Canadian firm cent months as part of its efforts to teen months ago, the feder- customers In the past, the company new customers. Mr. Braddock is the FirstService Corp.’s purchase of a upgrade its reputation. al government launched an spent a lot of money giving first to admit that 35,000 frequent 65% stake late last year in what was Mr. Jaccom says that with deep- investigation into FreshDirect’s hir- stuff away—such as a grocery users is too few (another 65,000 then known as GVA Williams and er pockets,he’s prepared to buy mar- ing practices, looking at whether it coupon worth $50—to lure new have used the service within the past its injection of a big shot of cash into ket share if he has to. employed undocumented workers. customers. “Those were our dumb 60 days). the business. “We’ll take a cut on commissions At the same time, the company was old days,” says Mr. Braddock. “We now have the ability to rec- “Before, we just couldn’t com- if the fee is good enough and we still being targeted by unions, which He also homed in on reducing ognize whether a customer is new, pete head-on with the big guys,” make a profit,” he says. tried to organize its 925 warehouse the number of complaints about lapsed, infrequent or loyal,” he says, says Mark Jaccom,chief executive of workers, claiming that they were everything from late deliveries to “and in the next couple of months FirstService Williams. “Now, our Reaching north of the border underpaid. missing or broken items.A year ago, we’ll greet everyone that way and brokers can go into any meetings further up the pecking order, 30% of orders had problems. Today tell them what they can expect from with their heads held high.” Newmark Knight Frank—the na- Growing pains that number is 15%. us.” His targets are CB Richard Ellis tion’s fourth-largest brokerage,with freshdirect denied the allega- Customers have taken note. In the second half this year, Inc., Jones Lang LaSalle and Cush- 26 offices in the United States—re- tions, and the union lost the elec- Megann McManus, who lives in FreshDirect, which now makes de- man & Wakefield—the three giants cently expanded its reach into tion. But FreshDirect could not Astoria, Queens, says that in the liveries in parts of Westchester,New that top National Real Estate In- Canada through a partnership with avoid a sullied reputation or the past FreshDirect would mess up Jersey and Connecticut, will draw vestor’s rankings of brokerages by a Montreal firm. service disruptions when it lost 40% every third order or so. up plans to expand to another major leases and sales transactions. Closer to home, it promoted of its warehouse employees. It may “Now I can’t remember the last city, possibly Boston or Philadel- To an extent, the smaller players David Falk to the newly created post still face a stiff fine from the federal time they didn’t get my order right,” phia.“This will be a lessons-learned are being emboldened by the finan- of president of the tristate region government. she says. expansion,” says Mr. Braddock.
cial travails at the Big Three, which with the aim of binding its six local all lost money in the first quarter of offices together into a more-power- this year. Seizing their opportunity, ful single player. the smaller firms are redoubling Meanwhile, Michael Ippolito, Univision’s blurry outlook their efforts, pointing out to Newmark’s new head of corporate prospective clients that they can of- services, is trumpeting the firm’s fer more personalized service and to ability to help companies maximize Continued from Page 3 signal. point for Univision,” wrote Wa- prospective brokers that they have a the efficiency of their real estate Rizzo. “You have pretty significant Still, the company is hardly im- chovia analyst Bishop Cheen in a re- more collegial atmosphere. holdings—and hopefully save mon- growth prospects for Univision.” mune to the troubled economy. Af- cent research note. A whopping One of the more active midlevel ey in the process. Prior to the recession, Univision ter years of steady,often double-dig- $7.5 billion payment is due in 2014. firms is Colliers ABR, which re- “This is the kind of service had been making good on those it earnings growth,Univision posted cently merged with three other Col- clients want in this environment,” prospects as it won over mainstream a net loss of $5.1 billion in 2008, fol- Back in court liers offices to expand the firm’s says Mr. Ippolito. marketers who had been slow to lowing a $5.4 billion write-down of if those troubles aren’t enough, reach in the mid-Atlantic and Mid- All these efforts are well and court Hispanic consumers. FCC licenses and other assets. Univision will be back in court next west. It also is in talks to add a cap- good, argue the Big Three, but they Historically, the company has For the first quarter of this year, week in Los Angeles with Televisa, ital markets team and a property all insist that it takes years to devel- suffered from a gap between its au- the company lost $55 million, as which produces the network’s tele- management executive and has even op the staff, systems and reputation dience numbers and share of ad dol- revenue slid 12%, to $410 million. novelas. The two sides recently set- hired a brand consultant to cook up needed to win larger clients. They lars. The new owners targeted that Its radio division was hit partic- tled a royalties dispute, and are now a new name. also note that they can spend more gap by hiring former OMD World- fighting over Internet rights. time nurturing client relationships wide President Joe Uva as chief ex- Univision declined to comment Not stopping here simply because they don’t have to fo- ecutive. Mr. Uva restructured ad ‘There are few on the lawsuit or debt issues. But an the merger means the company cus on building a team. sales under VH1 veteran David executive with knowledge of the sit- now boasts offices in 15 cities, but “We’ve been at this for 30 years, Lawenda. companies uation insists that the debt Colliers ABR Chairman Mark says Bruce Mosler,chief executive of At the same time,marketers have covenants “were set very loosely” Boisi says the consortium won’t stop Cushman & Wakefield. “We don’t stopped seeing Hispanic media as that look good and that the company is in no dan- there. It is in talks to bring other have to build up the infrastructure an add-on. Unlike in past reces- ger of breaching them. Colliers offices into the fold in the because we already have it.” sions, media buyers say, budgets are right now’ The executive adds that the com- near future. The Big Three are also aggres- not automatically being cut. pany has enough cash and credit to “Clients now want more scale, so sively protecting their turf.Last year, In fact, Univision has suffered cover the $500 million loan payment that is what we have to offer,” he JLL acquired The Staubach Co. less than its English-language no matter what the ad market is like. says. with its 42 offices. More recently, counterparts. A person with knowledge of the FirstService is also touting the JLL named an executive to lead its ularly hard, with revenue dropping private equity backers’ thinking says newfound weight that comes with brokers in the tristate area and lured Extra revenue stream 26%. the investors do not feel they loaded being part of a $1.6 billion company a top broker away from Newmark. “some advertisers have been Some analysts have expressed the company with too much debt. that owns 30 commercial brokerage Peter Riguardi, president of moving money from the general concerns about the company’s liq- “It looks daunting in the trough offices in the United States, as well JLL’s New York office, is well aware market into Hispanic,” says Lisa uidity and worry that Univision of a recession,”he says.Their feeling as a property management and an of the dangers of being a market Torres, group account director for could trip a loan covenant, particu- is that the company will return to appraisal firm. leader. the diversity unit of ad agency larly as the debt-to-EBITDA ratios growth over the next two to four Known for doing small transac- “Mario Andretti said that if you MPG. “The Hispanic market is tighten in the next couple of years. years and that the debt will seem less tions and managing properties are comfortable, you aren’t driving seen as a growth opportunity.” The company also faces a $500 mil- significant. “There are very few owned by the family that formerly fast enough,” says Mr. Riguardi. “I Univision is also getting fees now lion loan payment in 2011. companies that look good right controlled the company, FirstSer- just want to make sure we aren’t too from cable operators that carry its That year “could be the tipping now,” he adds.
vice Williams has picked up leasing comfortable.”

8 | Crain’s New York Business | June 1, 2009 20090601--A--0009-MAIN-CCI-CNYB--CRAINS NEW YORK BUSINESS MAIN (REGULAR) PUBLICATION 5/28/2009 6:55 PM Page 1

NEIGHBORHOOD JOURNAL

“It’s not clear if NYCHA has fol- Bronx residents go against shelter lowed that law in the past,” says As- semblyman Hakeem Jeffries, D- Brooklyn, who has requested that ing kitchens and bathrooms,and re- 3,475-apartment de- graded, according to NYCHA disclose plans to meet the Facility would be moving asbestos. velopment has been NYCHA. law. “Unemployment within Whit- eighth in Longwood, The remainder will be used to going through a ma- Community offi- man-Ingersoll is off the charts.” replace elevators in eight buildings, jor overhaul for at cials worry that the In fact, some officials estimate but may be needed according to NYCHA. Roughly least five years. Prior new jobs will not be that unemployment in the complex is to house homeless 550 jobs will be created through to receiving the given to tenants.Un- running well over 50%. A NYCHA the work, scheduled to begin in stimulus funds, the der Section 3 of the spokesman says the agency will en- esidents of Longwood November. complex had under- Housing and Urban UP FOR RENEWAL: B’klyn housing sure that “there are meaningful Sec- fear that their Bronx “We feel great about it,” says Ed gone city-funded Development Act, tion 3 jobs included.” neighborhood is fast Brown, president of the Ingersoll renovations totaling 30% of the work for “We won’t believe it until we see becoming City Hall’s Tenant Association.“But we are re- $91.7 million. So far, 17% of the public housing capital projects us- it,” says Mr. Brown. “We’ve been preferred home for the luctant to celebrate.” apartments have been rehabilitat- ing federal dollars must be given to sold so many dreams.” Rhomeless. The community has sev- Mr. Brown points out that the ed and 61 elevators have been up- residents. —amanda fung en Department of Homeless Ser- vices facilities within its boundaries. Residents are opposing an eighth facility at 731 Southern Blvd. that has been approved by the city and could open at any time. Roughly 35% of the city’s home- less shelters are in the Bronx, ac- What do you call a firm that adds more than cording to City Councilwoman 80 business lawyers in just four months? Maria del Carmen Arroyo, who is one of several local leaders opposing the new facility. She points out that it is not simply a case of “not in my backyard” syndrome. “What we’re saying is, ‘No more in my backyard,’ ” says John Robert, GAMECHANGER district manager of the area’s Com- munity Board. “We’ve done more than our fair share of helping out the homeless by accepting these seven PHILADELPHIA NEW YORK facilities. The line has to be drawn Corporate Corporate Demonstrating what it takes to win in today’s business environment. Charles G. Kopp David E. Bronston somewhere.” Jason M. Shargel Robert E. Fischer The drab building on Southern Michael M. Sherman Martha J. Flanders A solid strategy for growth. A strong financial platform. A proven Avenue has been an eyesore since its Asaf Hahami record of strength in adversity and performance under pressure. completion about a year ago, Mr. Commercial Litigation Albert J. Pinzon John V. Donnelly William Rosoff Cozen O’Connor’s full lineup now has 550 lawyers focused on Robert says. “It’s not a very attrac- Brian P. Flaherty Stuart A. Shorenstein high-end, complex litigation and business law matters, including tive design,and it stands out because John P. Moses it’s just gray.” Lisa Myers Commercial Litigation corporate, real estate, bankruptcy, health and IP—as well as private TamarS.Wise Jennifer F. Beltrami client services. Be that as it may,city officials in- Brian Levine sist that the building may well be Energy and Utilities Jill L. Mandell needed. Jeffrey J. Norton Kenneth G. Roberts With 23 offices worldwide, Cozen O’Connor is the growing choice Richard Rodriguez “We intend to open when and if Government Relations Angelo Savino for some of today’s most discerning clients—and attorneys. it’s necessary,” says DHS Commis- Mark L. Alderman James L. Simpson sioner Rob Hess. “It hasn’t hap- David F. Girard-diCarlo Edward J. Hazzouri pened yet,but it does look as though Intellectual Property Amy Divino For worldwide offices, visit us at cozen.com. we’re going to have to open more Private Client Services Michelle J. Dorman shelters.” Leonard J. Cooper Aude Gerspacher Robert I. Friedman Mr. Hess notes that DHS statis- Andrew P. Nemiroff Edward M. Glickman Joshua L. Raskin tics show that 37% of the city’s David R. Glyn Martin G. Raskin homeless are in the Bronx, so the Adam Grandwetter David B. Sunshine Matthew H. Kamens amount of facilities is appropriate. Thomas A. “Tad” Decker, Chief Executive Officer David S. Kovsky Private Client Services “Sadly, these kinds of numbers Lester E. Lipschutz Judith E. Siegel-Baum 250 Park Avenue are coming from the Bronx,”he says. Alexander Sanford Richard J. Duffy Amy Neifeld Shkedy New York, NY 10177 “And for the least amount of disrup- Steven G. Winters Herbert B. Fixler tion to the [lives of the homeless], Gail Goldfarb 212.509.9400 Real Estate Donald J. Hayde we try to house them in the borough Charles B. Law, Jr. Christine R. Deutsch 45 Broadway Atrium, Suite 1600 that they’re in.” Herman C. Fala Stephanie Lehman —hilary potkewitz Anthony Faranda-Diedrich New York, NY 10006 Helene S. Jaron Real Estate 212.509.9400 Elizabeth E. Kearney Christian Beltz Bernard Lee William F. Davis Fed funds come Diana C. Liu Kenneth K. Fisher Henry F. Miller Paul J. Proulx to B’klyn complex Shawn Neuman Richard B. Salomon Adam M. Silverman Abby M. Wenzel brooklyn’s whitman-ingersoll Robert A. Silverman Houses complex has emerged as one Susan E. Stanier WASHINGTON, DC Matthew I. Weinstein Government Relations of the biggest local beneficiaries of James R. Williams Mark L. Alderman President Barack Obama’s federal Thomas P. Witt David F. Girard-diCarlo stimulus spending. Tax White Collar Out of the 70 New York City Joseph C. Bright Kathryn R. Yingling Housing Authority public housing Thomas J. Gallagher developments that will receive a to- Cheryl A. Upham WILMINGTON, DE Joshua C. Weinberger Bankruptcy tal of $423 million for improve- Arthur A. Zatz Simon Fraser ments,the low-income,35-building Barry M. Klayman complex in the Fort Greene and LOS ANGELES The confidence to proceed. Litigation HARRISBURG Clinton Hill neighborhoods of Erik L. Jackson Tax Brooklyn is getting the most, $87 Reeve Segal Dan A. Schulder ® million. The bulk of the money will go to- ward renovating apartments—paint- © 2009 Cozen O’Connor ing, plastering, repairing or replac-

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VIEWPOINT A must-do list for Albany editor in chief Rance Crain publisher, vp Jill R. Kaplan ith the state legislative costs, with an additional benefit of 5% from the city, offsets editorial director Greg David session in its final weeks, three the New York premium—and generates more than enough EDITORIAL business-related issues deserve economic activity to pay for itself. It is also crucial, since editor Xana Antunes managing editor Glenn Coleman action: overhauling the state’s many other states now offer similar deals. deputy managing editors Valerie Block, antiquated liquor laws, The one-year extension helped to lure films, but it hasn’t Erik Ipsen contributing editor providing long-term tax helped with television shows, which are developed with the Elizabeth MacBride incentives for the film industry assumption of multiyear runs. Not all the details of the film columnist Alair Townsend senior reporters Theresa Agovino, and increasing New York’s woefully inadequate industry plan have been made public, but it aims for an Aaron Elstein, Erik Engquist, Lisa Fickenscher, unemployment insurance benefit. extended payout of the credit under a five-year program. Matthew Flamm, Miriam Kreinin Souccar W reporters Barbara Benson, Amanda Fung, Liquor laws. In March, the Legislature rejected an overdue New York needs the kind of middle-class production jobs Daniel Massey, Adrianne Pasquarelli, plan to allow supermarkets to sell wine—although that that the film industry brings, and it won’t have them without Hilary Potkewitz meant giving up a potential $160 million in new tax revenue a long-term credit that art director Steven Krupinski deputy art directors Carolyn McClain, annually—because it might have hurt some small liquor producers of these Daniel Mednick store owners. Now proponents are back with a new proposal The session’s multiyear projects can staff photographer Buck Ennis copy desk chief Wendy Zuckerman that would allow supermarkets to sell wine, yet also help almost over, but depend on. copy editor Thaddeus Rutkowski ambitious liquor retailers.The idea is to create a medallion Unemployment research editor Denise Southwood 3 business issues www.crainsnewyork.com system for liquor licenses.This would make licenses easier to benefits. Business web editor Brian Tracey sell, permit owners to operate in multiple locations, allow coop- groups are digging in senior producer Elisabeth Butler Cordova need attention Kira Bindrim erative buying groups and ease restrictions on wine tastings. when it comes to a producer This plan would allow the best of the current retailers to labor-based proposal to EDITORIAL AND ADVERTISING OFFICES 711 Third Ave., New York, NY 10017-5806 thrive while offering consumers expanded choices. And increase unemployment editorial: 212.210.0277 Fax 212.210.0799 advertising: 212.210.0259 given that a deficit has already opened up in the budget, the benefits, arguing that in Cable craincom nyk state needs the money. this economy, companies can’t afford the added taxes required. Fax 212.210.0499 Film tax incentives. Entire contents ©copyright 2009 Crain A new pitch from the film industry It’s a reasonable position, except that the jobless can’t afford Communications Inc. All rights reserved. ®CityBusiness is a registered trademark of MCP offers the Legislature a chance to rectify a blunder it made a New York’s parsimonious weekly payment, either. Inc., used under license agreement. few months ago when it renewed a popular tax incentive for The state’s maximum weekly benefit of $405 is the lowest TO SUBSCRIBE: only one year.The economics of the industry’s latest in the region and among the lowest in the country.Those Call 888.909.9111; fax 313.446.6777. $3.00 a copy, $59.79 one year, $109.79 two years. proposition are compelling. who lose their paychecks need—and deserve—more www.crainsnewyork.com

New York is a desirable location to shoot movies and assistance to get by until the job market improves. ADVERTISING AND MARKETING television shows because the city provides an unbeatable Labor groups will need to agree to a smaller increase than advertising director Trish Henry backdrop and because so many directors and stars who live they are seeking, and they’ll need to drop other potentially senior account managers Cornelius P. Gore, William E. Squitieri here want to work near home. Of course, the city is also an costly proposals they are advocating. After all, labor should commercial real estate sales manager expensive place. A state tax credit equal to 30% of production have no higher priority than helping the unemployed. Cory Marks account executives Jacqueline Iovino, Irene Irvill, Courtney McCombs, Anthony Mowad sales manager, classified LETTERS TO THE EDITOR print & online John Gallagher sales coordinator, print & online Lulé Haznedari sales coordinator Anita Perrino credit Todd J. Masura 313.446.6097 marketing director Amy Crossman Brooklyn’s mojo will continue rising marketing manager Jill H. Bottomley circulation manager Andrea Richardson assistant circulation manager BROOKLYN HAS The borough is home to a interests and meeting the needs of streets is at a standstill. Rosalie Ford THE POWER great number and wide variety of the individuals and businesses that —bill brusca general manager, interactive “can brooklyn keep its mojo?” exciting artists, along with great may be adversely affected by these Marc Minardo (Crain’s, May 18) seems to rely arts organizations (like my changes. OUR OFFICE IS LOCATED ON web developer, interactive upon the premise that our mojo own, BAM). We have the most —david arnow Broadway below Houston Street, Chris O’Donnell derives from transplanted interesting shops and res- and by reducing that part of NEW YORK PRODUCTION THE MAYOR SEEMS Manhattanites and other outer- taurants, as well as a diverse to think he’s Broadway to one lane for all production and pre-press director borough or state émigrés. population that personifies the Robert Moses, and we all know vehicles other than buses, Mr. Michael Corsi Nothing could be farther from urban energy of 21st-century what happened to his plans to level Bloomberg has made it profoundly advertising production manager the truth. New York City. downtown for a cross-Manhattan difficult to get a cab. Suzanne Fleischman Wies From Coney Island to egg Manhattan rents may be raised roadway and his West Side This mayor is further and PUBLISHED BY CRAIN COMMUNICATIONS INC. creams to the West Indian Parade dropping, but Brooklyn has a style Highway scheme. I work on further out of touch with New chairman Keith E. Crain on Eastern Parkway, Brooklyn and attitude that, frankly, is Times Square, and it’s a nightmare York City. He may make the city president Rance Crain invented mojo, and it’s not going priceless. because of all the pedestrians, not more pedestrian-friendly, but he’s secretary Merrilee Crain anywhere. —karen brooks hopkins the traffic. also making it business-averse. Is treasurer Mary Kay Crain —carl hum President They should have widened that really the best thing for New executive vp, operations William Morrow President and CEO Brooklyn Academy of Music the sidewalks.Traffic on Broad- York City? senior vp, group publisher Gloria Scoby Brooklyn Chamber of Commerce way, Seventh Avenue and cross group vp, technology, circulation, —rosemary kuropa manufacturing Robert C. Adams vice president/production & NO LACK POLL COMMENTS manufacturing David Kamis OF STREET CRED chief information officer Paul Dalpiaz PRIVATE VEHICLES, like private WHAT’S COMING UP IN CRAIN’S? corporate circulation director Patrick Sheposh brooklyn has worked long and firearms, make more sense in Top Health Crain’s hard to cultivate its new, cool Montana than in Manhattan. No- founder G.D. Crain Jr. (1885-1973) persona. It will take a lot more car zones, congestion pricing and management care Fortunate chairman Mrs. G.D. Crain Jr. (1911-1996) than a few vacant luxury condos to East River tolls are all good things. consultants report 100 undo the street cred our borough However, the city must have a June 8 June 15 June 22 now commands around the world. responsible plan for protecting the

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rate on them sharply. Both the mayor and the council seem resigned to reducing spending by about $3 billion. The press will characterize this as a cut, but it’s not a cut in the private-sector sense—a reduction from what was spent last year. In public-sector speak, it means a reduction from the amount by which the city intended to in- crease its spending. The mayor, Council Speaker Christine Quinn and her colleagues will all insist that the cuts will be painful. And $3 billion is indeed a significant sum,amounting to about 7% of the $44 billion the mayor pro- poses to spend in fiscal year 2010, beginning July 1. But it needs to be put in perspective. According to the Independent Budget Office,the city’s revenue in- creased by 74%—or about 12% a year—between 2002 and 2007. That’s at least three times the infla- john h.john howard tion rate. It is true that the mayor and the Audit Tax Advisory council built up a significant rainy day fund. Compared with the state, which spent every dime of the taxes Playing politics from the Wall Street boom and then Steve Mayer CPA some, the city acted with fiscal re- 212.682.1600 straint. Nevertheless, most of the www.amper.com boom money was spent. with city budget For 2010, the mayor is offsetting revenue declines with $2.5 billion in he advertisements saturating the airwaves in surplus funds from the boom years New York portray Michael Bloomberg as the de- (using up virtually all the money he has squirreled away) and about $1.5 cisive, independent and effective leader the city billion in federal stimulus money. needs to get through tough times. Those cushions will be almost gone The mayor’s achievements are many, but his by fiscal 2011. self-description leaves out one important attribute: He is a This is nothing less than delay- T ing the pain that is inevitable, even politician who practices the art of the possible, a fact that is after an economic recovery begins. The mayor clearly visible in his recognizes this plans for the next city fact of life. In budget. presenting his Publicly, the budget budget, he lec- negotiations getting tured the press under way between the on how the Does your company allow you to: mayor and the City banks’ losses • Work with a stellar group of people? Council are being cast have been so as a battle over taxes. great, they will • Do what you enjoy? The council seems shelter future • Explore new opportunities for growth? intent on a significant profits from increase in income tax GREG taxes for years. • Follow your own path? on the wealthy to raise DAVID I think the about $1 billion. The mayor knows mayor wants to hike the economically counter- he should be cutting the budget by Crain’s New York Business proudly presents New York sales tax to generate about the productive to target the rich just af- billions more. It’s just not political- City’s Best Places To Work 2009. Nominations are same amount, saying it would be ter the state raised its income tax ly possible. open for this honor, now in its second year of recognizing outstanding employers in the five boroughs. Companies will be profiled in Crain’s New York CRAIN’S ONLINE POLL Business and honored at a fall 2009 event. Is closing Broadway to cars a good idea? 398 VOTES Date of poll: May 26 Tell us why your job is so great and nominate your company as one of Yes. It’s good New York City’s Best Places to Work. for local businesses and eases the .40% No. Closing www.bestplacestoworknyc.com congestion on Broadway is overcrowded 60%. creating sidewalks. traffic Partner: chaos. getty images For readers’ comments, see Page 10.

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SPITZER REDUX? Image on upswing addressing childhood obesity, a IN A SIENA POLL RELEASED LAST WEEK, 21% of New Yorkers say they wish problem among urban minorities. Eliot Spitzer were governor, up from 11% a month ago. The disgraced former She’s pushing for chain restaurants governor placed third, behind former governors THE INSIDER to post nutrition facts on all menus. Mario Cuomo (31%) and George Pataki Image-crafting will not by itself (30%); Gov. David Paterson was fourth, at 11%. ward off challengers to Ms. Campaign consultants attribute Mr. Spitzer’s by Erik Engquist and Daniel Massey Gillibrand in next year’s jump to his recent media interviews and Mr. Democratic primary. But the Paterson’s record-low approval rating; some say Obama administration and Sen. a comeback for Mr. Spitzer is possible. Charles Schumer have already “The interviews gave him an opportunity to Establishing the Gilli-brand persuaded two potential candidates apologize, say he was wrong and that he would to withdraw. do better,” says Joseph Mercurio. “He also was t risk of being labeled by critics seen giving good public policy advice, and the as a gun-happy, pro-tobacco, anti- contrast to his successor is stunning.” Tensions over After resigning in March 2008 because of a immigrant conservative after her city pensions prostitution scandal, Mr. Spitzer vowed that he A bloomberg news unexpected ascendance to the U.S. would never seek public office again. But he Eliot Spitzer Senate in January, Kirsten Gillibrand has a fifth, less generous pension might find public support if he changes his mind. tier for city workers, proposed by “American voters come down hard on hypocrites, but they also believe in taken steps to try to establish herself as a Michael Bloomberg Mayor , doesn’t redemption,” Mr. Mercurio says. reassuring, inspiring brand: impress state Senate Civil Service Another strategist, Richard Fife, echoes that view. “Time is a great Committee Chair Diane Savino. A motherly senator. The idea disinfectant,” he says. “While he would have to think long and hard before he “It might save some money is to be seen not just as a would subject himself and his family to the assault of a campaign, Eliot in 20 years,” sneers Ms. Savino, mother of two young boys, but D-Staten Island. Spitzer is a person of great intelligence, determination and foresight, and I as a senator who protects She suggests that would never underestimate what he can accomplish.” But what would Mr. Spitzer run for? Not governor, according to Democratic children. Ms. Gillibrand government can afford to increase pension fund consultant Michael Tobman. “The specific reason for his resignation, though introduced the Safe Baby contributions, even though shocking by itself, underscored how temperamentally ill-suited he was for that Products Act to direct the they have risen from nothing position,” he says. Food and Drug to about 7% of payroll as fund The post at which Mr. Spitzer made his name, attorney general, would Administration to investigate investments have soured. open if Andrew Cuomo ran for governor, but Mr. Tobman says he wonders if They were 16% when Mr. Spitzer could come up with a better campaign narrative than “I think we and regulate the use of pension funds were all see that I should have never left this job.” chemicals in children’s conservatively invested, personal-care products. She bloomberg news according to Ms. Savino. Bloomberg administration demanded a probe of pharmaceuti- demanded better pay, training and spokesman Marc LaVorgna says city jurisdiction over public pension Liberal Democratic Club, a gay cals found in drinking water. She work conditions for pilots pension costs are actually 25% of bills. “Tier 5 would essentially organization, backed the race’s called for the elimination of a fee as- following the recent Buffalo crash. payroll, but Ms. Savino says she is eradicate all the improvements” straight candidate, Maria sessed to recipients of child support. An urban/rural bridge-builder. relying on a Senate Finance won by public employee unions Passannante-Derr. Club founder Allen A voice for the voiceless. Ms. Ms. Gillibrand plays up the fact Committee analysis that might over the years, she says. Roskoff has long been a Quinn Gillibrand introduced a measure to that she’s the first New Yorker in have used a different methodology. critic. Conventional wisdom holds protect tenants from immediate decades to sit on the Senate In any case, the city’s pitch appears that if both challengers make the eviction when banks foreclose on Agriculture Committee. She’s to have made little impression on Alliances divided ballot, Ms. Quinn would benefit: the buildings they live in. She trying to help farmers while the senator, whose committee has on insurance hikes Insurgents typically split the anti- incumbent vote.
gov. david paterson’s attempt to restore the state’s power to reject health insurance rate hikes has GUV-O-METER divided the business community. The Business Council of New York BELEAGUERED State, which counts large insurers as HOT GOV. DAVID Is a second-year associate at a mega key members, argues that the move PATERSON has hit would harm insurers by imposing yet another rough firm handling your legal matters? arbitrary price controls. But the patch. Last week, Chamber Alliance of New York State, a judge blocked which represents chambers of his new bottle bill commerce, says the measure would from taking effect lower costs for small businesses. June 1, prompting CANYS also gets funding from environmentalists insurers, but its support of the to blame Mr. Pat- governor’s proposal, contingent on erson for not fixing modifications, reflects a 14% the legislation Let our boutique dedicate an annual increase in health coverage costs in the state since 2000. weeks ago. “The governor should experienced partner who can NOT have displayed usually answer your questions Gay blocs speak out more leadership,” says Laura Haight of the New York without costly research. on candidates Public Interest Research Group. the gay political establishment Word then leaked that Mr. has been far from united in Paterson was going to sack his Contact Bill Borchard 212-790-9290 / [email protected] supporting the re-election of City press secretary, Errol Cockfield— Council Speaker Christine Quinn, just hours before the resignation of though she is one of the nation’s Insurance Superintendent Eric most powerful gay officials. After Dinallo, a key member of the rival Yetta Kurland won the endorse- administration. Mr. Dinallo will ments of two gay publications, the depart July 3 for an academic post. Blade and Go! Magazine, Ms. Meanwhile, the state’s fiscal Quinn is said to be working hard to situation continued to deteriorate, win the Stonewall Democratic forcing Mr. Paterson to threaten Attorneys at Law Club’s backing this week. vetoes of any spending bill. Ms. Quinn hit a speed bump 1133 Avenue of the Americas • New York, NY 10036-6799 last week when the Jim Owles www.cll.com For daily political and government news, subscribe to CRAIN’S INSIDER @ www.crainsnewyork.com/insider

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SMALL BUSINESS ➚ON THE WEB @ WWW.CRAINSNEWYORK.COM EXCLUSIVE Expanded profiles, video interviews and photo slideshows of award winners can be found online. Go to crainsnewyork.com/ smallbizawards

CRAIN’S TOPWINNER ENTREPRENEURS

CLEAN SWEEP: Victoria Aviles worked her way up to become “the master of all jobs.”

2009 buck ennis AGAINST THE BLEAKEST ECONOMIC backdrop in decades, Crain’s top entrepreneurs of 2009 are true standouts. Some are mapping innovative ways to weather the storm, while others are finding ways to actually benefit from it. DRY CLEANER PRESSES At SecondMarket, an online marketplace for trading financial instruments, founder Barry Silbert is setting up sites where mountains of subprime mortgages and other toxic FOR SMOOTHEST SERVICE securities can be bought and sold. SecondMarket’s revenues tripled last year, and Mr. Silbert—who started the company in Answer to customers is always ‘yes’ his Union Square apartment—recently set up shop in a BRIDGE CLEANERS landmark lower Broadway tower. SURVIVING, MUCH LESS STANDING OUT, in a city that boasts & TAILORS, KING Victoria Aviles is adding new products. Not one to take a thousands of dry cleaners is a struggle. For Victoria Aviles, GARMENT CARE 20% drop in business at her two dry cleaning shops lying down, the key is customer service. Founded 1976 she is offering services ranging from shoe polishing and repair At her two shops, she does more than tenderly tailor, clean Employees 24 to closet organizing. “I am willing to do anything in the world and press everything from hand-embroidered tablecloths to Revenue $2.2 million to keep the business growing,” she says. taffeta evening gowns. She also makes absolutely sure that it’s Best recession strategy All six of our winners also share their best recession strategies all done right. She assigns a staffer at both locations to inspect Marketing to customers with and biggest recession fears. fliers and hanger tags to let finished goods to make sure there lost its lease for the second time in them know about the firm’s are no buttons missing, hems dan- two years in 2008, Ms. Aviles was services. gling or fabric pilling. Fittingly, her forced to plunk Bridge down late Biggest recession fear INSIDE marketing materials are stamped last summer in a 1,600-square-foot Business will be so bad that with the tagline “Get spoiled.” storefront—a space nearly 60% payroll will need to be cut. “It goes against who Victoria is smaller than its previous digs. to give back a garment that’s not With real estate at a premium, as perfect as it can be,” says Nora she yanked the machinery out of Lady Victoria clothing detergent, Nealis,executive director of the her two shops and opened a plastering the bottles with the National Cleaners Associa- two-story plant in the Navy King Garment and Bridge labels. tion, who has known Ms. Yard. There, she launched “I am willing to do anything in Aviles for nearly 10 years. into green cleaning meth- the world to keep the business go- That commitment to WINNER ods and expanded her of- ing,” says Ms. Aviles. customer satisfaction has ferings with shirt launder- In some ways,the recent histo- ROB KALIN turned his BARRY SILBERT set STEVE HINDY left helped Ms. Aviles grow her ing and same-day pickup ry of her company simply repeats vision of a crafts up SecondMarket for journalism to bring business from the single and delivery services. that of her first years in the busi- community into the the trading of illiquid microbrews to Greenwich Village shop ness, when, as she puts it, “I be- Etsy site Page 14 assets Page 14 Brooklyn Page 14 she bought in 1976 for Responding to recession came the master of all jobs.” $185,000 to a mini-empire that similarly, with the recession Ms. Aviles began her career 40 ELLIOT FREAD is on a today encompasses Bridge Clean- wrinkling her bottom line—sales years ago at the bottom—sweep- ers & Tailors in downtown Brook- in the first quarter alone were ing at a small New Jersey dry clean- roll with his wholesale lyn, King Garment Care in SoHo down as much as 20%—Ms.Aviles er. Despite her limited knowledge sandwich business and a 57,000-square-foot central- is responding by adding new of English, the Colombian immi- Page 16 ized plant in the Brooklyn Navy sources of revenue, many at the grant managed to work her way up Yard. Last year, the 24-employee suggestion of her customers.In re- through pressing and tailoring to SAM SCHWARTZ began business generated $2.2 million. cent weeks, she has begun to clean finally doing the shop’s books, all an engineering firm after She has also demonstrated a re- pillows and help organize linen the while saving up enough mon- a government career markable ability not just to roll with and clothing closets. Last month, ey and absorbing enough lessons to Page 17 the economic punches but to coun- she started repairing and polishing go into business for herself. terpunch. When Bridge Cleaners shoes and selling her proprietary —cara s. trager

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REPORT SMALL BUSINESS ONLINE EXCHANGE HAS TRADE S Draws buyers, sellers of illiquid assets WHEN BARRY SILBERT WAS an investment banker struggling to sell off pieces of a bankrupt Enron Corp.six years ago,he kept asking himself the same question:“Wouldn’t it make sense if there was an organized marketplace,like eBay,where illiquid assets could be bought and sold?” STRATEGIC PLANNING: Rob Six years later, the answer is a resounding “yes.” Kalin has buttressed Proof of the pudding is a wildly successful outfit called Etsy’s top management team. SecondMarket that Mr.Silbert co- they had done enough old-fash-

buck ennis founded in 2004. Today, it boasts ioned canvassing among big in- 3,000 registered participants, who vestors and Wall Street figures— to date have traded $750 million including a co-chief executive of worth of assets in a total of 2,000 Houlihan Lokey, the investment DESIGNER CRAFTS transactions on the online market. bank where Mr. Silbert worked— Last year the company’s revenues to give the venture instant buzz. more than tripled. It collects a “SecondMarket under- fee of 2% of the value of the stood early on that illiquid trade from both sides. assets don’t sell them- HUMAN TOUCH: ARTISAN COMMUNITY Barry Silbert has his Mr. Silbert traces his selves,” said David Weild staffers work directly prowess trading illiquid as- WINNER IV,a former vice chairman with SecondMarket Site provides paths for direct purchases sets—goods that are hard to of Nasdaq and a senior con- users.

price, much less sell—all the sultant to SecondMarket. buck ennis AS A HIGH-SCHOOL DROPOUT who had gone on to attend half a dozen way back to his childhood. Mr.Silbert says Second- colleges before finally emerging from New York University with a “I was always entrepre- Market works because it Two years ago, Mr. Silbert major in the classics, Rob Kalin seemed to have few—if any—of neurial, but especially so combines whiz-bang raised $3.8 million from venture the ingredients for entrepreneurial success. after my father died when I was 10,” technology with good old human capital firm FirstMark Capital in he says.“Back then, I set up forums interaction.In addition to offering return for a 25% stake. Instead, at the age of 25 he was just another aspiring furniture for trading baseball cards,which are users state-of-the-art trading soft- designer, working out of a cramped Brooklyn apartment and essentially illiquid assets.” ware, the company has the bulk of Financial cushion hoping to scratch out a living selling his stuff online. When hours He and his partner, the late its 100 staffers—up from just sev- “we never tapped into the mon- Brad Monks, spent a year devel- en in 2006—working directly with ey, but knowing it was there for a of surfing for a site that would allow oping SecondMarket’s technolo- users to answer any questions they rainy day gave me the confidence him to do just that got him nowhere, ETSY gy after raising $350,000 from an- may have. Company officials also to scale up,” says Mr. Silbert. Mr. Kalin had his epiphany. gel investors. But by the time they spread the word by speaking at He has watched his pennies He had a vision of an almost Utopi- Founded 2004 went live in the summer of 2005, conferences and networking. since the early days, when the an place where people could purchase Revenue $1 million/month handcrafted items online directly from Employees producers like himself, and where 65 those artisans could share their busi- Best recession strategy Not ness and aesthetic challenges and solu- spending what Etsy doesn’t have. tions with each other online and off. Not doing things that are FORMER JOURNALIST’S FROTHY B “I wanted to create a marketplace outlandish—like ballooning the community,” says Mr. Kalin. head count from 65 to 500. Outsourcing, self-distribution key Biggest recession fear Sellers will Desire to make a difference STEVE HINDY HAS COME A LONG WAY struggle to put a roof over their heads from the days when he true, he didn’t have the urge to peddled six-packs of Brooklyn Lager out of the back of a make pots of money, but what he had and food in their mouths. Their lives was something at least as powerful— will be knocked off balance; they white GMC van. The brewery that he co-founded 20 years a consuming passion to make a differ- won’t be able to create. ago sold more than 1 million cases last year, and Mr. Hindy ence.He began by quickly filling a few expects revenues to increase 10% this year. key gaps. While he designed Etsy’s site and wrote the online copy,he cor- where sellers can purchase materials “It’s a good time to be in the beer business,” he says. ralled two techies from NYU to set up from crafts suppliers.In addition,Etsy Well,at least it’s a good time for Mr.Hindy,who now owns its servers. For capital, he turned to a users can communicate through fo- furniture customer who gave him rums and live chats,as well as via Etsy’s one of the most successful small talked legendary Milton Glaser— $50,000 in seed money. offline crafts events and workshops. brands in the industry.Looking for creator of the “I
New York” In June 2005,Etsy,still based in Mr. As the company has grown, with a fresh challenge after a career as a campaign—into designing the Kalin’s Fort Greene apartment, help from $30 million in venture foreign correspondent for the As- company’s logo. went live. It caught on almost capital, Mr. Kalin has but- sociated Press, Mr. Hindy de- Production was out- immediately. Today the com- tressed Etsy’s management. cided to become an entrepre- sourced to an upstate pany boasts a quarter of a mil- WINNER Last year, he hired NPR dig- neur. brewery, which meant lion crafters selling 3.8 million ital media executive Maria The first thing he had to WINNER that Messrs. Hindy and listed items to 2.3 million regis- Thomas to succeed him as do was persuade his down- Potter could concentrate tered members. On an average chief executive. He also tapped stairs neighbor, Tom Potter, on finding customers.They day, the firm’s 65 employees a former Yahoo exec as chief to quit his job as a loan offi- made the rounds of bars and

process nearly 25,000 orders technology officer—not de- cer for Chemical Bank to bodegas, wooing retailers buck ennis and collect a fee of 3.5% of the sell- spite the recession but because of it. start a beer business. with their dream of bring- ing price. Last year, Etsy had $87.5 “When money is scarce, value can “Tom thought I was nuts,” ing brewing back to Brooklyn. “You can make the best beer in million in gross merchandise sales— be something magical—a nice piece says Mr. Hindy, who spent nearly They made five sales the first day. the world, but you have to be able more than triple 2007’s $26 million. of jewelry for $20 that comes with a a year wearing down his friend’s Rather than share profits, the to get it on the market,” says Paul “Rob’s empowered people to sell special story about where and who resistance. “He was my first sale.” partners chose to distribute the Gatza,director of the Brewers As- the things they make and to earn a liv- they got it from,” says Mr. Kalin. With Mr. Potter in charge of product themselves.They set up a sociation, a national trade group. ing by cutting out the middleman,” As Etsy’s chairman and chief cre- finances and Mr. Hindy handling distribution arm and named it the says Brooklyn-based clothing design- ative officer,Mr.Kalin is now focusing marketing,the two found a master Craft Brewers Guild. As it turned Amber lining er Chanel Kennebrew, who has been on strategic planning and on his next brewer with a family beer recipe. out, the operation was so adept at in 1994, Mr. Hindy hired a new selling on Etsy.com for two years. startup,Parachutes Inc.,which aims to They then turned their attention getting Brooklyn Lager on shelves master brewer with the ability to Etsy today is a place where the pub- reinvent how people teach and learn. to packaging. After weeks of and behind bars that 15 other mi- make more ambitious products. lic can buy directly from artisans, and —cara s. trager phone calls, Mr. Hindy finally crobrews became customers. Five years ago, the partners

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meetings were held at a nearby alized debt obligations.With busi- 17485-17754-BScraines_jnl Starbucks. ness booming, he moved the With the financial crisis have company in the fall to its first fan- come immense growth opportuni- cy address, the landmark Standard ties, as investors seek to unload Oil Building on lower Broadway. hundreds of billions of dollars “Trillions of dollars of assets worth of illiquid assets.To seize his that were once liquid have turned opportunity,Mr. Silbert added five illiquid during the financial melt- more online marketplaces that down,” says Mr. Silbert. banks can use as auction blocks for —tina traster

BROOKLYN Y BEER STORY BREWERY Founded 1987 Quick, pick a banker Employees 40 Revenue $18 million Best recession strategy Avoid taking on debt; be cautious “PLEASE ENTER with budgeting. “HOW CAN YOUR 16-DIGIT Biggest recession fear ACCOUNT NUMBER” I HELP YOU?” Rising cost of raw materials.

FIRING LINE: Owning a business is similar to covering a war, Steve Hindy says. Switch to the bank that puts your business first. Switch to Sterling. For 80 years, Sterling National Bank has attracted business clients by following one simple rule: sold Craft Brewers for $12 million, years. Additionally,the company is And the service you deserve. and Mr. Potter cashed out. As a re- about to score 15,000 square feet at when your business succeeds, so do we. We have the products you need. sult, Mr. Hindy is coping with the a good price in a neighboring If switching banks has been on your to-do list, call Sterling today. You’ll like what you hear. recession solo and last year had to building.The extra space would al- scrap plans to hire more staff and low it to produce more of its high- raise prices. end brews in the borough. But the downturn has had an Mr. Hindy likens life as an en- amber lining: Brooklyn Brewery’s trepreneur to his experience cover- landlord in Williamsburg recently ing wars, saying, “You never know 212.757.1100 www.sterlingnationalbank.com canceled a major rent hike and is what you’re going to run into.” EST.1929. Member FDIC. close to extending the lease for 15 —kira bindrim

June 1, 2009 | Crain’s New York Business | 15 20090601--A--0016,0017-MAIN-CCI-CNYB--CRAINS NEW YORK BUSINESS MAIN (REGULAR) PUBLICATION 5/28/2009 4:16 PM Page 1

REPO QUEENS SANDWICH MAKER ON A R

Food wholesaler finds magic recipe BIMMY’S FOCUS PAYS. Founded 1994 Growing up as the son of a food service director for a big Employees 85 hospital and the grandson of a legendary Toronto restaurateur Revenue $8 million ATLANTIS HEALTH PLAN cum television chef, Elliot Fread never had any doubts about Best recession strategy what he’d do. Keep investing in new and BY DOCTORS. FOR NEW YORKERS. “I knew my life would be about food,” he says. “I worked in better equipment to increase every aspect of food—waiting, bartending, short-order productivity; move forward Founded by a group of 12 physicians, with business expansion plans. Atlantis Health Plan delivers what cooking, purchasing—before I sale premade sandwich business, Biggest recession fear New Yorkers need: affordable, quality struck out on my own.” specializing in rolled sand- Having to lay off additional health insurance. Atlantis’ mission is And that is where, 14 wiches stuffed with healthy staff. to provide high quality health care in years ago,he hit the jackpot. ingredients, from sprouts New York City by utilizing the expertise Today,his Long Island City, WINNER and watercress to low- of local practicing doctors. Atlantis Queens-based company, sodium meats. That flexibility paid off in 2005 members can save 20-30 percent off Bimmy’s, has grown into one His first when he found a of the city’s largest whole- kitchen was a 20,000-square-foot the cost of comparable plans. salers of high-end sand- 700-square- Mr. Fread space in Long Island wiches. foot affair invested in City at a fraction of Atlantis Health Plan, Inc. From the beginning, Mr. in the West Vil- the rent he was pay- 45 Broadway, Suite 300 Fread did things differently.One of lage. He also ing in Manhattan. New York, NY 10006 his first creations was something he opened two retail a meat slicer Mr. Fread cooks (212) 747-0877, called “rolled sandwiches”—which outlets in Manhat- up ideas for his more (866) 747-8422 (toll free) the world later came to call tan, including one to boost than 100 sandwiches (212) 747-0843 (fax) wraps—selling them in a friend’s at Chelsea Market, by digesting restau- www.atlantishp.com West Village coffee bar. When it both of which fell productivity rant menus, food went bust, Mr. Fread lost his victim to soaring magazines and cook- kitchen, but his sandwiches had rents. ing shows, but he is caught on. “I’m not senti- always open to sug- After a midtown coffee bar mental,” says Mr. gestions as well. promptly signed him on as a sup- Fread. “If it makes “If we have a cus- plier, he rented a kitchen and good business sense to move on, tomer who wants a certain kind of launched his career in the whole- that’s what I do.” bread, I call up Elliot and he makes

GOOD PLAN: Sam Schwartz has built a brand using his 20 years in government service. buck ennis

16 | Crain’s New York Business | June 1, 2009 20090601--A--0016,0017-MAIN-CCI-CNYB--CRAINS NEW YORK BUSINESS MAIN (REGULAR) PUBLICATION 5/28/2009 4:16 PM Page 2

P ORT SMALL BUSINESS

WINNERS LIKE RESULTS A ROLL CRAIN’S TOP ENTREPRENEURS of 2009 are people who excel at delivering results in good times the necessary adjust- and bad. Their taste in politicians ment,” says Andy Serna, reflects that bottom-line chief executive of Pyra- orientation. mid Coffee, a Manhat- We asked all six of our winners tan coffee-bar chain. to rank the on-the-job performance “Bimmy’s is a big com- of President Barack Obama, Gov. pany, but it’s not too big David Paterson and Mayor to care about a small ac- Michael Bloomberg on a scale of 1 count like us.” to 10, with 10 being the top score. Flexibility needed Below are the results of the poll. All six entrepreneurs put the three these days, the reces- politicians in the same order, sion is testing Mr.Fread’s disagreeing only on their flexibility as never be- PUTTING IT ALL numerical ratings. fore. In the face of a 15% TOGETHER: Elliot Fread drop in sales at airports, (center) gets ideas for his more than 100 where Bimmy’s makes sandwiches by digesting most of its money, Mr. menus, magazines and Fread slashed his staff by cooking shows. 20%.To boost efficiency, he poured $85,000 into an automated meat slicer that has boosted produc- tivity by 75% and re- duced waste. Luckily Bimmy’s has no debt. It also owns all of its kitchen equipment and five of its seven trucks. Tbe other two

are on short-term leases. buck ennis Recently, Duane PRESIDENT7.9 BARACK OBAMA Reade asked Mr. Fread to supply in coming months, which could Bimmy’s café in midtown this sum- the pulse of what people want to eat fare for two of its stores. Mr. Fread drive annual revenue back up to $10 mer. and to give Bimmy’s greater expo- is hoping to expand that toehold to million, where it peaked in 2007. “I view retail as a way to have a sure,” he says. at least a dozen Duane Reade stores He is also planning to open a test kitchen, to keep the finger on —tina traster

SAM SCHWARTZ GRIDLOCK SAM MOVES PEOPLE ENGINEERING Founded 1995 go, Washington and Florida in the Employees 70 Consultant parlays government career past nine months, Mr. Schwartz Revenue $8.3 million SEVERAL YEARS AGO, when planners were faced with figuring out forecasts a revenue jump of over 30% this year—provided that he Best recession strategy Go how people would get to a sprawling new waterfront park can get the financing he needs to where the dollars are—the public GOV.4.2 DAVID PATERSON marooned on the wrong side of the Brooklyn-Queens fuel his expansion. sector, in this case. We’ve Expressway, they called Sam Schwartz. The owner expects that growth beefed up our efforts to land The transportation engineer produced a plan to reroute more to come from procuring even more government contracts and are public-sector projects, which now opening new offices in than a dozen bus lines and set up a shuttle system to nearby account for 85% of revenues. anticipation of more stimulus subway stations. He also redesigned two busy intersections to Going global spending. make walking to Brooklyn Bridge at New York City’s Department of sam schwartz Engineering, a Biggest recession fear Cash Park safer and to free up Transportation.His claims longtime consultant to the Metro- flow problems. We worry that the more land for the park. to fame include coining the politan Transportation Authority banks won’t be there when we As a bonus, Mr. term gridlock and writing and other agencies, is now winning procure a new megacontract and Schwartz allayed commu- the weekly “Gridlock Sam” public contracts nationwide. are ready to expand. nity concerns about the WINNER column for the Daily News. Those jobs included drafting the project, which has been in All of that helped Sam traffic plan for President Barack the works for two decades. Schwartz Engineering, his Obama’s inauguration.Additional- tailer’s isolated location in Red “Would the various Manhat- ly, the company Hook, Brooklyn. government entities and tan-based has landed proj- The firm also created the traffic MAYOR8.8 MICHAEL BLOOMBERG community players coordi- transporta- ‘When I meet a ects in Canada, plans for Citi Field and the pro- nate all that if left on their own?” tion consulting firm, South Korea and posed expansion of Columbia Uni- asks Hank Gutman, a director of post revenues of client, I speak China. versity.When the economy slowed, ON THE WEB the Brooklyn Bridge Park Devel- more than $8 mil- As recently as Mr.Schwartz switched his market- ➚➚ opment Corp. “Maybe. But know- lion last year and add the language two years ago, ing efforts back to government EXCLUSIVE ing Sam Schwartz is there to design 12 employees in the 60% of Sam projects. Get expanded profiles of Top it and handle outreach, you know past two months. of city Schwartz Engi- “As my business has expanded Entrepreneurs, with video inter- the job is going to get done.” “I understand neering’s business across the country, I’ve found that views and slideshows. The New York native has gone the machinery of bureaucrat’ came from pri- the language of local government Go to crainsnewyork.com/ beyond establishing an enviable government, so vate-sector cli- bureaucrat is remarkably the smallbizawards reputation in his field. when I meet with a ents. Those in- same,”Mr.Schwartz says.“And my Mr. Schwartz has built a one- client I can speak cluded Ikea, for clients, whether they’re in the pri- To sign up for Crain’s new man brand by parlaying the experi- the language of the which the firm de- vate or public sector, find the abil- twice-weekly SMALL BUSINESS ence and contacts gained in his city bureaucrat,” signed a network ity to speak that language very NEWSLETTER, go to nearly 20-year career in govern- Mr. Schwartz says. of ferries and shuttle buses to trans- valuable.” www.crainsnewyork.com/smallbiz buck ennis ment—ultimately as chief engineer Having opened offices in Chica- port shoppers to and from the re- —matthew sollars bloomberg news

June 1, 2009 | Crain’s New York Business | 17 20090601--A--0018-MAIN-CCI-CNYB--CRAINS NEW YORK BUSINESS MAIN (REGULAR) PUBLICATION 5/28/2009 2:48 PM Page 1

REAL ESTATE DEALS

man, brokers at Hanley Advisors, No idling: GMAC reparks on Sixth represented Trilantic. —theresa agovino

lease at that building expires in mid- kers at Newmark Knight Frank, ne- Battered financier 2011. GMAC also has offices at gotiated on behalf of Carlyle. Low cost of burgers takes prime space 1290 Sixth Ave.; the lease there ex- —theresa agovino lucky for Lucky’s pires at the end of next year. outside GM Building The move to Sixth Avenue is part lucky’s famous burgers is still of the company’s assessment of its Ex-Lehmanites go trying to grow into its name. The as it streamlines real estate needs in an effort to cre- full circle at old site eatery just signed a 12-year lease for ate a more efficient footprint and 800 square feet of ground-floor ortified by a fresh $7.5 lower costs, says the spokeswoman. the founders of Trilantic Capital space, along with a 325-square-foot billion infusion of feder- CB Richard Ellis Inc. brokers Partners are back where they start- basement,at 264 W. 23rd St.,between al bailout cash, GMAC Amanda Bokman and Robert Mar- ed—only higher up. Seventh and Eighth avenues. The just inked a good deal for tin represented GMAC.Neil Gold- The private equity fund, recent- asking rent for the ground floor was prime office space at macher and Brian Goldman, bro- ly established by former Lehman $150 a square foot. F1177 Sixth Ave. for its capital markets Brothers merchant bankers, leased Lucky’s first outlet on West 52nd group.The former financing arm of roughly 13,300 square feet at 399 Street debuted four years ago. The General Motors is subleasing the Park Ave. that had been occupied by new burger joint—expected to open entire 16th floor of the building,be- the failed investment house. within four months—replaces a Bur- tween West 45th and West 46th While they were at Lehman, the CENTRAL BOOKING: Well-located 399 Park. ritoVille that was shuttered last fall. streets, from The Carlyle Group. Trilantic executives toiled on the Brad Schwarz, a broker at Sierra The asking rent for the deal, ninth floor of the building, located Realty who represented Lucky’s with which covers 24,000 square feet,was between East 53rd and East 54th Boston Properties after it filed for colleague Peter Braus,notes that the $88 a square foot, according to mar- streets. Their new space covers just bankruptcy. company can do well in this type of ket sources. GMAC will pay 42% over half of the 15th floor. The ask- “We have to start somewhere [in environment because it offers value. less,or about $51 per square foot,for ing rent for the four-year deal was leasing the space],” says Peter Tur- A burger and fries together cost $8. the first five years of the lease,which $80 a square foot. chin, a broker at CB Richard Ellis “Some companies that used to extends until July 2015. The rent “It was built as private equity Inc. who represented the landlord, order from higher-end catering will rise to $56 in the sixth year, a space, so it is perfect for our needs,” with his colleague John Powers. places are now ordering burgers,” spokeswoman says.The company is says Jon Mattson,a partner at the new Mr. Turchin hopes that other Mr. Schwarz says. expected to move into the furnished firm.“It has great Park Avenue views, tenants will be drawn to the well-lo- Bill Abramson and Gabe Whit- space within the next several weeks. and it is close to Grand Central.” cated, handsomely furnished space. man of Buchbinder & Warren Re- GMAC’s capital markets group Trilantic’s lease constitutes only “Tenants will have to invest very alty Group represented landlord is now located on half a floor in the about 3% of the 400,000 square feet little capital,” he says. Jema Properties in negotiations. GM Building at 767 Fifth Ave.The CADDY SHACK: GMAC moves to 1177 Sixth. that Lehman returned to landlord James Coleman and Steven Kauf- —adrianne pasquarelli

18 | Crain’s New York Business | June 1, 2009 nb22p19-20cls.qxp 5/29/09 1:43 PM Page 19

PUBLIC & LEGAL NOTICES REAL ESTATE

Notice of Qualification of JBS USA, Notice of Qualification of Kondaur Notice of Formation of Kezar NOTICE OF FORMATION of Neighbor- AUCTION LLC. Authority filed with NY Dept. of Ventures VIII B1, L.L.C. Authority filed Productions, LLC. Arts. of Org. filed hood Eats, LLC. Arts Of Org. filed with State on 4/14/09. Office location: NY with NY Dept. of State on 5/12/09. with NY Dept. of State on 5/8/09. Secy. Of State of N.Y.(SSNY) on 5/06/09. County. Princ. bus. addr.: 1770 Office location: NY County. LLC formed Office location: NY County. Princ. Office location: NY County. SSNY des- Promontory Cir., Greeley, CO 80634. in DE on 4/30/09. NY Sec. of State bus. addr.: 666 Greenwich St., Apt. ignated as agent of LLC upon whom LLC formed in DE on 5/29/02. NY designated as agent of LLC upon 505, NY, NY 10014. Sec. of State process against it may be served. SSNY Sec. of State designated as agent of whom process against it may be designated as agent of LLC upon shall mail process to principal business LLC upon whom process against it served and shall mail process to: c/o whom process against it may be location: 35 East 30th St. #9C, NY, NY may be served and shall mail CT Corporation System, 111 8th Ave., served and shall mail process to: c/o 10016. Purpose: Any lawful activity. process to: c/o CT Corporation NY, NY 10011, regd. agt. upon whom CT Corporation System, 111 8th 1238421 w.o. System, 111 8th Ave., NY, NY 10011, process may be served. DE addr. of Ave., NY, NY 10011, regd. agt. upon regd. agt. upon whom process may LLC: c/o The Corporation Trust Co., whom process may be served. Notice of Qualification of MANCUSO be served. DE addr. of LLC: The 1209 Orange St., Wilmington, DE Purpose: any lawful activity. EQUITY PARTNERS, LLC. Authority COMMERCIAL Corporation Trust Co., 1209 Orange 19801. Cert. of Form. filed with DE Sec. filed with Secy. of State of NY WAREHOUSE SPACE St., Wilmington, DE 19801. Arts. of of State, Townsend Bldg., Dover, DE NOTICE OF FORMATION of Limited (SSNY) on 05/18/09. Office location: Org. filed with DE Sec. of State, 401 19901. Purpose: any lawful activity. Liability Company / Partnership (LLC) NY County. LLC formed in Delaware Federal St., Dover, DE 19901. Laurel 17C, LLC L.L.C. Articles of (DE) on 05/14/09. Princ. office of New Jersey Port Warehousing Purpose: any lawful activity. Notice of Formation of ZZ PICTURES, Organization filed with the Secretary LLC: 900 Third Ave., 18th Fl., NY, NY Up to 75,000 sq/ft - LLC. Arts. of Org. filed with Secy. of of State of New York (SSNY) on 10022. SSNY designated as agent of Notice of formation of Limited Liability State of NY (SSNY) on 04/17/09. 1/14/2009. N.Y. Office location: New LLC upon whom process against it Divisible, Secured Company. Name: Selfhelp (KI-KII) Office location: NY County. Principal York County. SSNY has been desig- may be served. SSNY shall mail Transportation Included Associates LLC (“LLC”). Articles of office of LLC: c/o Skuli Malmquist, nated as an agent upon whom process to c/o Corporation Service Organization filed with NY Secretary 435 W. 19th St., 4th Fl., NY, NY 10011. process against it may be served. Co. (CSC), 80 State St., Albany, NY Jeanette Ayala (908) 282-7330 of State (“SSNY”) on May 13, 2009, SSNY designated as agent of LLC The Post Office address to which the 12207-2543. DE addr. of LLC: c/o NY Office location is New York upon whom process against it may be SSNY shall mail a copy of any CSC, 2711 Centerville Rd., Ste. 400, County. The SSNY has been desig- served. SSNY shall mail process to process against the LLC served upon Wilmington, DE 19808. Arts. of Org. nated as agent of the LLC upon the LLC at the address of its principal him/her is C/O the LLC 16055 N. Dial filed with Secy. of State, Div. of whom process against it may be office. Purpose: Any lawful activity. Blvd, Suite 4 Scottsdale, Arizona Corps., PO Box 898, Dover, DE LUXURY served. The SSNY shall mail a copy 85260. The Principal Business 19903. Purpose: Any lawful activity. of any process to LLC at 520 Eighth Notice of Formation of TRIBECA Address of the LLC is: 16055 N. Dial PROPERTIES Avenue, New York, NY 10018. POINTE MEMBER (HHE) L.L.C. Arts. Blvd, Suite 4 Scottsdale, Arizona Name of LLC: ORDA LLC. Articles of Purpose/character of LLC is to of Org. filed with Secy. of State of NY 85260. Dissolution Date: Perpetual (if Org. filed Dept. of State of NY on AUCTION engage in any lawful act or activity. (SSNY) on 4/24/09. Office location: any) Purpose/character of LLC: To 1/16/09. Office location in NY: New NY County. Principal business loca- engage in any lawful act or activity. York County. Secy. of State designated Notice of formation of Limited Liability tion: 290 Park Avenue South, 14th 1236875 w.o. 25,000’ Country Retreat as agent of LLC upon whom process Company. Name: Selfhelp (KI-KII) Fl., NY, NY 10010. SSNY designated Sullivan Co., NY against it may be served. Sec. of State Manager LLC (“LLC”). Articles of as agent of LLC upon whom process Notice of Formation of BCMS COR- shall mail a copy of process to: Rayner 33-Acre Sanctuary Near Organization filed with NY Secretary against it may be served. SSNY shall PORATE N.A. LLC, a domestic LLC. Rowe LLP, 75 Rockefeller Plaza, 20th Delaware River of State (“SSNY”) on May 13, 2009, mail process to: 290 Park Avenue Arts. of Org. filed with the SSNY on Floor, New York, NY 10019. Purpose: 18 BR, 20 BA, Indoor Pool, NY Office location is New York South, 14th Fl, NY, NY 10010, Attn: 03/09/09. Office location: NY County. any lawful activity. County. The SSNY has been desig- CEO. Purpose: any lawful activity. SSNY has been designated as agent Massive Kitchen nated as agent of the LLC upon upon whom process against the LLC 6-Car Garage, Softball Field, whom process against it may be NOTICE OF FORMATION OF LIMIT- may be served. SSNY shall mail a Notice is hereby given that a license Waterfall, Ponds served. The SSNY shall mail a copy ED LIABILITY COMPANY. NAME: copy of process to: The LLC, 30 (#TBA) for Liquor has been applied Separate 6 BR, 4 BA Duplex Home of any process to LLC at 520 Eighth TACET CREATIONS LLC. Articles of Broad St. 29th Fl, NY, NY 10004. for by 5 West 36 Restaurant Corp., at ***Several Corporate Avenue, New York, NY 10018. Organization were filed with the Purpose: Any Lawful Purpose. retail, in a Restaurant, under the ABC Law at 11-13 W. 32 St. 5 Floor, NY, NY Uses Are Permitted*** Purpose/character of LLC is to Secretary of State of New York (SSNY) June 7 @ 1:01 PM engage in any lawful act or activity. 10001 for on-premises consumption. on 05/14/09. Office location: New York Notice of Formation of 8515 Bay No Minimum Starting Bids! County. SSNY has been designated Parkway JS LLC. Arts. of Org. filed 800-243-0061 AARauctions.com Notice of Formation of MTMH HOLD- as agent of the LLC upon whom with Secy. of State of NY (SSNY) on Notice of Qualification of JBR PART- ING LLC. Arts. of Org. filed with Secy. process against it may be served. 3/26/09. Office location: NY County. NERS, LLC. Authority filed with Secy. of State of NY (SSNY) on 05/08/09. SSNY shall mail a copy of process to SSNY designated as agent of LLC of State of NY (SSNY) on 05/14/09. Office location: NY County. Principal the LLC, 184 2nd Avenue, Suite 3A, upon whom process against it may Office location: NY County. LLC TELECOMMUNICATIONS office of LLC: c/o Martin Levine, 805 New York, New York 10003. Purpose: be served. SSNY shall mail process formed in Delaware (DE) on 12/24/08. Third Ave., Ste. 1100, NY, NY 10022. For any lawful purpose. to: c/o Wharton Realty, 500 Fifth Principal office of LLC: 825 Third SSNY designated as agent of LLC Avenue, 54th Fl., NY, NY 10110. Ave., 10th Fl., NY, NY 10022. SSNY upon whom process against it may be Notice of Formation of HSK Capital, Purpose: any lawful activity. designated as agent of LLC upon served. SSNY shall mail process to LLC. Articles of Organization filed whom process against it may be the LLC at the address of its principal with Secy. of State of NY (SSNY) on Notice of Formation of REGULATORY served. SSNY shall mail process to 307 Fifth Avenue office. Purpose: Any lawful activity. c/o Corporation Service Co. (CSC), 04/29/09. Office location: NY County. REPORTING SERVICES, LLC. Arts. New York, NY 10016 SSNY designated as agent of LLC of Org. filed with Secy. of State of NY 80 State St., Albany, NY 12207-2543. Notice of Qualification of HIGHSTAR upon whom process against it may DE address of LLC: c/o CSC, 2711 212-532-7400 GP III HOLDINGS LLC. Authority filed (SSNY) on 05/11/09. Office location: be served. SSNY shall mail process NY County. SSNY designated as Centerville Rd., Ste. 400, Wilmington, [email protected] with Secy. of State of NY (SSNY) on to the LLC, 300 East 79th Street, Apt. DE 19808. Arts. of Org. filed with DE 04/21/09. Office location: NY County. agent of LLC upon whom process 26E, New York, NY 10021. Purpose: against it may be served. SSNY shall Secy. of State, John G. Townsend Metrocom is proud LLC formed in Delaware (DE) on any lawful act or activity. Bldg., 401 Federal St., Ste. 4, Dover, 04/20/09. Principal office of LLC: 277 mail process to the LLC, c/o Michael to announce that we H. Barnett, Esq., 375 Lexington Ave., DE 19901. Purpose: Any lawful activity. Park Ave., 45th Fl., NY, NY 10172. Notice of Formation of Independent have been appointed SSNY designated as agent of LLC Ste. 200, NY, NY 10168-0002. Content Company, LLC. Arts. of Org. Purpose: Any lawful activity. NOTICE OF APPLICATION OF as a Vertex Standard upon whom process against it may filed with NY Dept. of State on AUTHORITY OF Air Berlin PLC & be served. SSNY shall mail process 12/13/07. Office location: NY County. Notice of Formation of Caerus Global Co. Luftverkehrs KG (a/k/a Air Berlin Authorized Dealer to c/o Corporation Service Co., 80 Sec. of State designated as agent of GP LLC, Art. of Org. filed Sec’y of PLC & Co. Luftverkehrs KG. L.P.) to & Service Center. State St., Albany, NY 12207-2543. LLC upon whom process against it State (SSNY) 4/14/09. Office loca- do business in New York as a foreign DE address of LLC: 2711 Centerville may be served and shall mail tion: NY County. SSNY designated as limited partnership. Application for Rd., Ste. 400, Wilmington, DE 19808. process to the principal business agent of LLC upon whom process Authority filed with the Secretary of Arts. of Org. filed with DE Secy. of addr.: 130 Watts St., #3S, NY, NY against it may be served. SSNY shall State of New York (SSNY) on 4/28/09. State, Div. of Corps., John G. 10013. Purpose: any lawful activity. mail copy of process to 750 Lexington N.Y. office location: New York County. Townsend Bldg., 401 Federal St., LP formed in Berlin, Germany on Ave., 16th Fl., NY, NY 10022. VERTEX STANDARD is registered in the US Patent and Ste. 4, Dover, DE 19901. Purpose: Notice of Qualification of FIR TREE Purpose: any lawful activities. 7/18/91. SSNY has been designated Trademark Office. All other product or service names are Any lawful activity. VALUE ABS HOLDINGS, LLC. as agent of LP upon whom process the property of their respective owners. Authority filed with Secy. of State of Notice of Qualification of MPS/IH, LLC. against it may be served. The P.O. Notice of Qualification of SGGP NY (SSNY) on 04/22/09. Office loca- Authority filed with Secy. of State of address to which the SSNY shall mail MANAGEMENT, LLC. Authority filed tion: NY County. LLC formed in NY (SSNY) on 4/7/09. Office location: a copy of any process against the LP with Secy. of State of NY (SSNY) on Delaware (DE) on 02/20/09. Principal NY County. LLC formed in Delaware served upon him/her is C/O: Condon PUBLIC & LEGAL 03/23/09. Office location: NY County. office of LLC: 505 Fifth Ave., 23rd Fl., (DE) on 3/10/09. Principal office of & Forsyth LLP; Times Square Tower; LLC formed in Delaware (DE) on NY, NY 10017. SSNY designated as LLC: Multipackaging Solutions, Inc., 7 Times Square; New York, NY 10036. NOTICES 06/27/08. Principal office of LLC: c/o agent of LLC upon whom process 150 E. 52nd St., NY, NY 10036. The principal Business Address of Stripes Group LLC, 70 E. 55th St., against it may be served. SSNY shall SSNY designated as agent of LLC the LP is: Saatwinkler Damm 42-43; Notice of Formation of Rockrose 11th Fl., NY, NY 10022. SSNY desig- mail process to Jeffrey D. upon whom process against it may 13627 Berlin, Germany. The names General Properties L.L.C. Arts. of nated as agent of LLC upon whom Tannenbaum, 505 Fifth Ave., 23rd Fl., be served. SSNY shall mail process and business address of the general Org. filed with Secy. of State of NY process against it may be served. NY, NY 10017, registered agent upon to the LLC, 5800 W. Grand River, partners are available from the SSNY. (SSNY) on 4/7/09. Office location: NY SSNY shall mail process to the LLC whom and at which process may be Lansing, MI 48906. DE address of The name and business address of County. Principal business location: at the address of its principal office. served. DE address of LLC: c/o LLC: c/o Corporation Service Co., the authorized official where a certifi- 290 Park Avenue South, 14th Fl., NY, DE address of LLC: c/o The Corporation Service Co., 2711 2711 Centerville Rd., Ste. 400, cate of limited partnership is filed is: NY 10010. SSNY designated as Corporation Trust Co., 1209 Orange Centerville Rd., Ste. 400, Wilmington, Wilmington, DE 19808. Arts. of Org. Amtsgerich Berlin-Charlottenburg: agent of LLC upon whom process St., Wilmington, DE 19801. Arts. of DE 19808. Arts. of Org. filed with filed with Secy. of State of DE, Div. of Amtsgerichtsplatz 1:14057 Berlin, against it may be served. SSNY shall Org. filed with State of DE, Div. of Secy. of State of the State of DE, 401 Corps., John G. Townsend Bldg., 401 Germany. Purpose of LP is to engage mail process to: 290 Park Avenue Corps., 401 Federal St., Dover, DE Federal St., Dover, DE 19901. Federal St., Ste. 4, Dover, DE 19901. in any lawful act or activity. South, 14th Fl., NY, NY 10010, Attn: 19901. Purpose: Any lawful activity. Purpose: Any lawful activity. Purpose: Any lawful activity. 1232255 w.o. CEO. Purpose: any lawful activity.

June 1, 2009 | Crain’s New York Business | 19 nb22p19-20cls.qxp 5/29/09 1:45 PM Page 20

PUBLIC & LEGAL NOTICES

Notice of Qualification of Blackstone Notice of Qualification of NEW Notice of Qualification of AUSAF I, Notice of Qualification of Blackstone NOTICE OF FORMATION OF Real Estate CMBS Fund L.P.Authority THRIFT A GLOBAL OPPORTUNI- LLC. Authority filed with Secy. of State Family Real Estate Special Situations Cremona In America LLC. Article of filed with NY Dept. of State on 5/1/09. TIES INVESTMENTS III L.P. of NY (SSNY) on 04/30/09. Office loca- Partnership L.P.Authority filed with NY Organization filed with the Secretary Office location: NY County. LP formed Authority filed with Secy. of State of tion: NY County. LLC formed in Dept. of State on 4/23/09. Office loca- of State of NY (SSNY) on MARCH in DE on 4/14/09. NY Sec. of State NY (SSNY) on 04/09/09. Office loca- Delaware (DE) on 04/29/09. Principal tion: NY County. LP formed in DE on 20, 2009 Office location NEW YORK designated as agent of LP upon whom tion: NY County. LP formed in office of LLC: One Penn Plaza, Ste. 3/30/09. NY Sec. of State designated County. SSNY has been designated process against it may be served and Delaware (DE) on 03/11/09. Principal 4625, NY, NY 10119. SSNY designat- as agent of LP upon whom process as agent upon whom process against shall mail process to the principal office of LP: 520 Madison Ave., 35th ed as agent of LLC upon whom against it may be served and shall it may be served. The Post Office business addr. of the LP: c/o The Fl., NY, NY 10022. SSNY designated process against it may be served. mail process to the principal business address to which the SSNY shall mail Blackstone Group L.P., 345 Park Ave., as agent of LP upon whom process SSNY shall mail process to the LLC at addr. of the LP: c/o The Blackstone a copy of any process against the NY, NY 10154. Regd. agt. upon whom against it may be served. SSNY shall the address of its principal office. DE Group L.P., 345 Park Ave., NY, NY LLC served upon him/her is C/O the process may be served: CT Corporation mail process to c/o Corporation address of LLC: c/o Corporation 10154. Regd. agt. upon whom process LLC 236 WEST 15TH STREET System, 111 8th Ave., NY, NY 10011. Service Co. (CSC), 80 State St., Service Co., 2711 Centerville Rd., Ste. may be served: CT Corporation (#65). New York, NY 10011. Purpose DE addr. of LP: c/o The Corporation Albany, NY 12207-2543. Name and 400, Wilmington, DE 19808. Arts. of System, 111 8th Ave., NY, NY 10011. of LLC: to engage in any lawful act or Trust Co., 1209 Orange St., Wilmington, address of each general partner are Org. filed with Secy. of State of DE, DE addr. of LP: c/o The Corporation activity. Street address of Principal DE 19801. Name/addr. of genl. ptr. available from SSNY. DE address of Jeffrey W. Bullock, John G. Townsend Trust Co., 1209 Orange St., Business location is: 236 WEST 15TH available from NY Sec. of State. Cert. LP: c/o CSC, 2711 Centerville Rd., Bldg., 401 Federal St., Dover, DE Wilmington, DE 19801. Name/addr. of STREET (#65).New York, NY 10011. of LP filed with DE Sec. of State, 401 Ste. 400, Wilmington, DE 19808. Arts. 19901. Purpose: Any lawful activity. genl. ptr. available from NY Sec. of Federal St., Dover, DE 19901. of Org. filed with Secy. of State of the State. Cert. of LP filed with DE Sec. REEL YOU STUDIOS LLC, Articles of Purpose: any lawful activity. State of DE, Div. of Corps., John G. Notice of Formation of Limited Liability of State, 401 Federal St., Dover, DE Org.filed N.Y. Sec.of State(SSNY) 7th Townsend Bldg., Federal and Duke of Company. Name: Pasha Events, LLC. 19901. Purpose: any lawful activity. day of April 2009. Office in New York Name: WILLOW ROCK ASSOCIATES, York St., Dover, DE 19901. Purpose: Articles of Org filed with Sec’y of State Co. at 825 3rd Avenue, 2nd Floor, New LLC Art. Of Org. Filed Sec. of State Any lawful activity. of NY (SSNY) 5/7/09. Office location: Notice of Formation of One Twenty York New York 10022. SSNY desig. of NY 01/06/09. Off. Loc.: New York NY County. SSNY designated as Consulting, LLC, Art. of Org. filed agt. upon whom process may be Co. SSNY designated as agent upon NOTICE OF FORMATION of Park agent for LLC upon whom process Sec’y of State (SSNY) 3/19/09. Office served. SSNY shall mail copy of whom process against it may be Bridge Advisors LLC. Arts. of Org. may be served. SSNY shall mail copy location: NY County. SSNY designat- process to 1 Maiden Lane, 5th Floor, served. SSNY to mail copy of filed with the Secy of State of NY of process to the LLC, 29 Broadway, ed as agent of LLC upon whom New York, New York 10038. Reg. Agt. process to THE LLC, 50 Broad, ST., (SSNY) on 02/20/09. LLC renamed Ste 2222, New York, NY 10006. process against it may be served. upon whom process may be served: RM. 808, New York, NY 10004. Park Bridge Financial LLC. Office Purpose: Any lawful purpose. SSNY shall mail copy of process to Speigel & Utrera, P.A., P.C. 1 Maiden Purpose: Any lawful act or activity. location: NY County. SSNY designat- Attn: Robert Lieberberg, 120 E. End Lane, NYC 10038. 1 800 576-1100 ed as agent of LLC upon whom Ave., Apt. 4B, NY, NY 10028. Notice of Formation of WEINSTEIN Purpose: Any lawful purpose. Name: MY SOHO LLC ART. Of Org. process against it may be served. Purpose: any lawful activities. SSNY shall mail process to principal SMITH LLP. Cert. of Reg. filed with Filed Sec. of State of NY 12/05/08. Secy. of State of NY (SSNY) on Notice of Formation of A.C. Metric business location: C/O the LLC 30 Notice of Qualification of D. E. Shaw Off. Loc.: New York Co. SSNY desig- 4/8/09. Office location: NY County. LLC. Articles of Org filed with Secy. of Rockefeller Plaza, 41st FL, NY, NY Real Estate Portfolios 10, L.L.C. nated as agent upon whom process SSNY designated as agent of LLP State of NY (SSNY) on 3/18/09. Off. 10112. Purpose of LLC: To engage in Authority filed with NY Dept. of State against it may be served. SSNY to upon whom process against it may Loc.: New York County. SSNY desig- any lawful act or activity. on 2/26/09. Office location: NY County. mail copy of process to THE LLC, C/O be served. SSNY shall mail process nated as agent of LLC upon whom LLC formed in DE on 8/13/07. NY Carlo Giovannetti, Esq., 520 Eighth to the Partnership, 50 W. 29th St., process against it may be served. Sec. of State designated as agent of Avenue, 18th Flr., NY, NY 10018. Notice of Formation of DIGITAL Apt. #11W, NY, NY 10001. Purpose: SSNY shall mail process to: The LLC LLC upon whom process against it Purpose: Any lawful act or activity. PLIGHT STUDIOS LLC, a domestic Practice the profession of law. 301 W 108th St 11E NY, NY 10025. LLC. Arts. of Org. filed with the SSNY may be served and shall mail process Purpose: any lawful activity. Notice of Formation of Insurancezone on 01/14/09. Office location: NY County. to: D. E. Shaw & Co., L.P., 120 W. Agency LLC. Arts. of Org. filed with SSNY has been designated as agent NOTICE OF FORMATION of 45th St., 39th Fl., NY, NY 10036, Secy. of State of NY (SSNY) on upon whom process against the LLC Chameleon Branded Entertainment, Attn: John Liftin, General Counsel, 3/26/09. Office location: NY Co. may be served. SSNY shall mail a LLC. Arts. Of Org. filed with Secy. Of regd. agt. upon whom process may SSNY designated as agent of LLC copy of process to: James McCarthy, State of N.Y. (SSNY) on 1/5/09. be served. DE addr. of LLC: 1209 Coming Up upon whom process against it may 425 E. 63rd St Apt. E4B, NY, NY Office Location: New York County. Orange St., Wilmington, DE 19801. be served. SSNY shall mail process 10065. Purpose: Any Lawful Purpose. SSNY Designated as agent of LLC Arts. of Org. filed with DE Sec. of on the Calendar to: Mark Defazio, c/o The LLC, 99 upon whom Process against it may State, 401 Federal St., Dover, DE Park Ave., NY, NY 10016. Purpose: be served. SSNY shall mail process 19901. Purpose: any lawful activity. Name of Foreign LLC: MKCP to principal business location: 114 W June 15th any lawful activities. EMPLOYEES IV GP LLC. App. for 17th St., 3rd Fl., NY, NY 10011. Notice of Qualification of Hasbro Healthcare Auth. filed NY Dept. of State: 3/19/09. Purpose: Any lawful activity. Notice of Qualification of Metropolitan Jurisd. and date of org.: DE 1/27/09. Managerial Services LLC. Authority Real Estate Partners VII, L.P., App. County off. loc.: New York County. filed with NY Dept. of State on 3/4/09. June 22nd for Auth. filed Sec’y of State (SSNY) Sec. of State designated as agent of NOTICE OF FORMATION OF LIMIT- Office location: NY County. LLC 3/2/09. Office location: NY County. LP foreign LLC upon whom process ED LIABILITY COMPANY. NAME: formed in RI on 12/10/08. NY Sec. of Fortunate 100 org. in DE 2/26/09. SSNY designated against it may be served. The Sec. of MerrinThink, LLC. Articles of State designated as agent of LLC as agent of LP upon whom process State shall mail copy of process to: Organization were filed with the upon whom process against it may be against it may be served. SSNY shall The LLC, 623 5th Avenue, 18th Floor, Secretary of State of New York served and shall mail process to: c/o June 29th mail copy of process to Attn: Felipe New York, NY 10022. Addr. of foreign (SSNY) on 04/02/09. Office location: CT Corporation System, 111 8th Ave., City Facts Dorregaray, 135 E. 57th St., 16th Fl., LLC in DE is: 615 South DuPont New York County. SSNY has been NY, NY 10011, regd. agt. upon whom NY, NY 10022. DE office addr.: c/o Hwy., Dover, DE 19901. Auth. officer designated as agent of the LLC upon process may be served. RI and prin- CSC, 2711 Centerville Rd., Wilmington, in DE where Cert. of Form. filed: Sec. whom process against it may be cipal business addr.: 1027 Newport July 13th DE 19808. Cert. of LP on file: SSDE, of State of the State of DE, c/o DE served. SSNY shall mail a copy of Ave., Pawtucket, RI 02862. Arts. of Townsend Bldg., Dover, DE 19901. Div. of Corporations, 401 Federal process to the LLC, 148 Reade Org. filed with RI Sec. of State, 148 Small Business Name/addr. of each gen. ptr. avail. at Street, Dover, DE 19901. Purpose: Street, New York, New York 10013. W. River St., Providence, RI 02904. SSNY. Purpose: any lawful activities. any lawful activity. Purpose: For any lawful purpose. Purpose: any lawful activity.

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BUSINESS CORPORATE LADDER Development lawyer builds work-out biz in NYC PAGE 23

GOTHAM GIGS In the spotlight From laid-off to owner apollo theater President and Chief Executive JONELLE PROCOPE, 57, works to spread Recession sparks franchising boom the famed theater’s influence. “It’s had a real impact on the development of American culture,” she says. LEGAL EXPERT The Philly native moved to New York to attend law school at St. John’s University in 1974. After graduation, she became an associate at Skadden Arps Slate Meagher & Flom. She’s also worked at Viacom and Bristol-Myers Squibb. ARTISTIC GROWTH Ms. Procope, who joined the Apollo in 2003, has expanded the not-for-profit’s education program.The program offers free classes on set design and supports the development of aspiring artists. STARSTRUCK She is currently preparing for the Harlem theater’s 75th anniversary gala on June 8, when Patti LaBelle and Quincy Jones will be inducted into the Legends Hall of Fame.Though it has felt the effects of the recession, the theater is hoping to make a strong fundraising comeback. —maia blume

EXPERT OPINIONS

HOW TO LAND A JOB AFTER GRADUATION advertise your job search SWEET TREAT: Jason with former bosses, internship Saber took his daughter for frozen supervisors, teachers and yogurt and ended up classmates. Show up before or with a business plan. after normal business hours, when the manager you want to talk to is likely to have free

time. Use the Internet to find buck ennis company contacts, and follow up with a phone call. Join FASTEST-GROWING professional associations and BY LISA FICKENSCHER attend events to meet FRANCHISES IN 2008 potential employers. Once you s months without a job dragged on, Jason Saber began thinking land an interview, answer about starting his own business.The idea clicked into place one questions succinctly and don’t feel afternoon early this spring when his 13-year-old daughter persuaded compelled to fill him to take her to a Red Mango near their home in Syosset, L.I. the silence. Mr. Saber, who lost his sales position in December, liked the —john frozen-yogurt shop so much that he submitted a business proposal challenger Chief executive to the California-based company last month and has been scouting

istockphoto Challenger retail sites in Queens to open a franchise. Gray & “I’m at a point in my life where I want to be more in control of my Source: Technomic Inc. Christmas Inc. See FRANCHISE on Page 22 A June 1, 2009 | Crain’s New York Business | 21 20090601--A--0022-MAIN-CCI-CNYB--CRAINS NEW YORK BUSINESS MAIN (REGULAR) PUBLICATION 5/28/2009 8:20 PM Page 1

BUSINESS LIVES Franchise entrepreneurs HELPING HANDS THE HARSH ECONOMIC CLIMATE has spurred Continued from Page 21 chisor’s disclosure statement, aver- “This is arguably the best time to companies to go the extra mile to assuage potential own destiny,”says the father of three. age store sales exceed $500,000 an- build restaurants.” franchisees’ fears about starting a business, as well Mr.Saber,51,is one of the tens of nually. Indeed, most franchisees go But unlike in past downturns, as to help them get loans. thousands of New Yorkers who are for multiple outlets. when banks kept lending, getting fi- Red Mango, for example, has introduced a frustrated with their prolonged peri- Andy Stern got into franchising nancing is an obstacle. Loans bigger store buy-back program. Franchisees who are od of unemployment and who have after the tech bubble burst. Mr. than $250,000 are hard to come by, dissatisfied with their business’s performance some funds to reinvent themselves as Stern, who had an executive posi- says Harold Kestenbaum,an attorney within six months of opening can sell it back to Red entrepreneurs. A growing number tion at Idealab, left the company in specializing in franchise law. Mango for up to are turning to restaurant franchises, 2001. As he invested in other start- And most restaurant franchises $275,000. which is the only category expected ups and considered opportunities, cost more that. Trufoods, which owns to grow this year,according to the In- he determined that he wanted to Mr.Saber,for instance,estimates Wall Street Deli, Ritter’s Frozen Custard, ternational Franchise Association. run a brick-and-mortar business. that he needs up to $400,000 to Pudgie’s Famous Chicken and Arthur Treacher’s Fast-food and casual eateries stand open a Red Mango store. Looking Fish & Chips, is setting up an in-house financing to gain the most, because families into a Small Business Administra- program. haven’t stopped eating out entirely ‘I decided tion loan, he was disheartened to “Two years ago, we probably wouldn’t have but are trading down. learn that he would have to secure it, needed to do this because the banks were that I wanted most likely with his home. He’s un- writing checks,” says Gary Occhiogrosso, chief Less risky certain whether he’ll actually apply. development officer at Trufoods. recessions are generally fruit- to work for Even those willing to try don’t ful times for franchising: It’s seen as necessarily qualify, as Rob Cox less risky than opening a stand- myself’ found out when he applied for an alone business because of the mar- SBA loan to open a Tasti D-Lite. “I’ve used all my own capital to have to put some stuff on my credit keting and management support The 33-year-old, who lost his job as date,” says Mr. Cox, whose 16- card. That’s part of the entrepre- provided by the companies. De- a distressed-equities trader at Citi- month-old daughter was born the neurial spirit, to have a little bit of clines in rents and construction group over a year ago, had conclud- week before he lost his job. “I may faith.”
costs during a downturn also help He opened his first franchise in ed that his industry was in decline. reduce startup expenses. 2004.He and a partner now co-own To capitalize on these condi- 16 Dunkin’ Donuts and six Subway A question of capital tions, Red Mango just launched a shops in New York City and Wash- “i decided that I wanted to work Eatery case study: national recruitment effort that in- ington, as well as three Five Guys for myself,and I wanted a local busi- cludes holding seminars in key mar- burger franchises here. A Dunkin’ ness,” says the Jersey City resident. kets. One in Manhattan last month Donuts in New York can generate Mr. Cox tapped his 401(k) for attracted 220 potential franchisees, revenues of more than $1 million, the costs to establish a store, which Can Payard pay up? including Mr. Saber, who is still according to industry experts. the frozen dessert company esti- looking for a full-time job as he The recession has actually en- mates at $253,000 to $431,000. He mulls his entrepreneurial options. couraged Mr. Stern and his partner expects to open his shop across from shop, he hopes to reopen it else- Though his wife would help run to expand, and they hope to double the Grove Street PATH station this Rent hike may force where in the city. the business,Mr.Saber says,“I’d still their portfolio of Five Guys burger month and has hired five employees famed East Side need a day job, because one Red joints by year-end. to help him cover the grueling Second sites Mango would not be enough to “We are trying to grow a little schedule of 12-hour days, seven pâtisserie to close “right now, I’m looking for other support us.” According to the fran- faster right now,” Mr. Stern says. days a week. locations,” says Mr. Payard, who BY LISA FICKENSCHER also operates a chocolate factory and confectionery shop in Dumbo, prominent pastry chef François Brooklyn, and bistros in Las Vegas, Thursday, June 18, 2009 Payard may close his flagship café Brazil and Japan. “Many are open- and bakery on the Upper East Side ing up right now.” 8:00 am – 12:00 pm because of a steep rent hike. Mr. Kirschenbaum says land- Mr.Payard filed a notice with the New York State Department of La- Crowne Plaza Times Square bor stating his intention to shutter Payard Pâtisserie & Bistro in August 1605 Broadway SMALL BUSINESS and lay off all 74 employees there. At 49th Street The chef and his landlord, Ste- phen Kirschenbaum, are now nego- tiating, even though an arbitration panel voted in February to increase the rent by 62%,to $60,000 a month. “The maximum increase I can Presented by: bear in this economy is 20%,” says Mr. Payard, who opened the eatery on Lexington Avenue between East CRUMMY SITUATION: 74 staff may lose jobs. Presenting Sponsors: 73rd and East 74th streets 12 years A don’t-miss morning conference outlining ago. lords are all too often blamed in ten- specific New York City resources for your Deal on the table? ant disputes. small business. The Guardian Life Insurance according to Mr. Kirschenbaum, “Landlords are not always the Company of America, NY, NY his tenant, who has not paid rent villains,” he says. “And tenants are Featuring: since last December, was offered a not always the poor [victims].” City Sponsor: deal with certain conditions to stay in Mr. Payard is not the only tenant •Opening Session: City Council Speaker Christine Quinn the space rent-free through the fall. of 1032 Lexington Ave. who is not •Crain’s 2009 Top Entrepreneurs Mr.Payard says that he is follow- paying rent. The building is also ing the advice of his lawyer. He has home to a prince:Ertugrul Osman of •What Government Can Do For You City Supporters: warned his staff that the outcome of Turkey,who lives in a rent-stabilized •Breakout Sessions on Growing Revenues & the negotiations is uncertain. apartment on the third floor.He sued He says that while the economy Mr. Kirschenbaum in 2006 to force Managing the Workforce has slowed his sales, “we are doing him to make repairs to the abode. OK.” In January, he opened the According to Mr.Kirschenbaum, Partners: Lexington Avenue spot on Sundays the elderly prince has not paid his for the first time, in order to gener- $357 monthly rent in four years. Plus much more. Go to: ate more revenues. The landlord and the prince have Mr. Payard, who left Paris in been locked in litigation over that http://futurenyc.crainsnewyork.com 1991 to become the pastry chef at period, during which the city’s De- Le Bernardin, says that if he is partment of Buildings has inspect- forced to close his bistro and pastry ed the apartment dozens of times.

22 | Crain’s New York Business | June 1, 2009 20090601--A--0023-MAIN-CCI-CNYB--CRAINS NEW YORK BUSINESS MAIN (REGULAR) PUBLICATION 5/28/2009 8:20 PM Page 1

BUSINESS LIVES CORPORATE LADDER James Raved Getting it worked out Former development lanta-based firm’s operations in New York City. PERSONNEL FILE lawyer builds firm’s Radco is currently involved in the turnaround and sales and mar- EMPLOYER Radco Development NYC office by helping keting of about $3 billion worth of Solutions projects nationwide. Competition TITLE Senior vice president distressed projects from other established shops, such as Douglas Wilson Cos., as well as AGE 40 BY AMANDA FUNG newer players means the firm must RÉSUMÉ Senior vice president, continue to differentiate itself. Tishman Construction; chief coun- hen real estate sel, real estate and construction, giant Tishman Changing focus Bear Stearns Construction re- last year, Radco handled $1 bil- duced its staff lion of distressed projects and re- MANAGEMENT STYLE Persistent numbers late last structured a $2.6 billion loan port- and hands-on year,W James Raved was among the folio. Like other developers, the PREFERRED RECREATION Skiing high-ranking executives whose privately held company has stopped in Vermont posts were eliminated. building; it’s instead focused on res- With the market turning increas- olution consulting, which it has ingly sour, Mr. Raved realized that been involved in since 1994. N. Cardozo School of Law and the age of development was over— “There is a lot of work out there practiced construction law for four

at least until financing flowed freely for a firm like ours,” Mr. Raved says. years. He then joined now-defunct buck ennis again. So he decided to follow the After graduating from Hartwick Bear Stearns, playing a key role in money and help lenders and in- College, in Oneonta, N.Y., Mr. the construction of Bear’s $750 mil- where he was a member of the man- as he builds Radco’s roster of New vestors resolve distressed residential Raved worked for his father, a con- lion U.S.headquarters at 383 Madi- agement committee. York business. The firm is working and commercial deals. struction manager, on an Upper son Ave. He also helped the invest- on two distressed projects in the “I’ve been fortunate to have been East Side mansion. He held the en- ment bank develop 2 million square Legal, business acumen area: one in lower Manhattan and able to do a lot of ground-up devel- try-level job of clerk of works,which feet of office space around the coun- “jamie’s combination of legal and another in Greenwich, Conn. Mr. opment,” Mr. Raved says. “But that ensures that the quality of materials try, including the MetroTech com- business acumen [serves] him well,” Raved will not give details. isn’t taking place right now.” and workmanship meets the pro- plex in downtown Brooklyn. Addi- says Daniel Tishman,chief executive He believes his experience will Earlier this year, he joined Rad- ject’s design and specifications. tionally, he participated in the deal of the firm and Mr. Raved’s former help him be successful in the region. co Development Solutions, a devel- “I grew up in the business,” he for Bear’s U.K. headquarters at Ca- boss.“These skills are vital in the real “I’ve seen everything as it relates oper that also specializes in complex says.“When you’re born into real es- nary Wharf, in London. estate world, especially as old busi- to construction disputes,”Mr.Raved real estate transactions and financial tate, you are either drawn further Wanting to join a dedicated real ness models are reshaped and we be- says.“That’s what I do: get involved workouts. The Manhattan native is into it or run away from it.” estate firm, Mr. Raved left Bear in gin to emerge from this downturn.” and make sure the project gets back responsible for expanding the At- Mr. Raved went on to Benjamin 2007 for Tishman Construction, Mr. Raved will need those skills on track.”

EXECUTIVE MOVES

ACCOUNTING & CONSULTING named vice president of sales. He was promoted to special counsel from The Partners: Steven Gilliatt, 55, joined formerly vice president of sales and associate. HOT JOBS as managing director. He was formerly business development at Aria Systems. Michael P.Rosenstein, 37, was promoted principal at SG Brandgroup, which he [x+1]: Toby Korner, 31, was appointed to special counsel from associate. founded. vice president of account management. Daniel Turinsky, 33, was promoted to WANTED: PRESIDENT He was formerly senior director at special counsel from associate. EDUCATION Marketing Management Analytics. Kleinberg Kaplan Wolff & Cohen: ORGANIZATION Brooklyn Children’s Museum Scholarship America: Rhianna Quinn Matthew J. Gold, 52, was promoted to JOB DESCRIPTION Running the nonprofit, recently expanded to Roddy, 50, was appointed executive LAW member from counsel. 102,000 square feet director of designated funds. She had Cozen O’Connor: Joshua Raskin, 38, Kramer Levin Naftalis & Frankel: Adam C. been chief marketing officer at joined as member. He was formerly Rogoff, 45, joined as partner. He was MOST IMPORTANT TASKS Fundraising to compensate for cuts in Lighthouse International. partner at WolfBlock. formerly partner at Cooley Godward city operating support for the institution and get the last $1.5 mil- Kenneth Roberts, 54, joined as member. Kronish. lion of its $80 million-plus capital campaign FINANCE & INSURANCE He had been partner at WolfBlock. Linklaters: Daniel Dufner, 39, joined as Citadel Securities: Todd Kaplan, 44, Richard Salomon, 61, joined as member. partner. He was formerly partner at CREDENTIALS NEEDED Leadership position in arts or educational joined as head of investment banking. He had been partner at WolfBlock. White & Case. organizations, or experience in another industry and service on He had been head of global leveraged Stuart Shorenstein, 62, joined as member. Meister Seelig & Fein: Sidney Bluming, related boards finance, global markets and financing at He had been partner at WolfBlock. 64, was named partner. He had been Merrill Lynch. Judith Siegel-Baum, 62, joined as member. president at Bluming Freiman Franco, SALARY The president earned $192,000 in fiscal 2007 Brian Maier, 49, joined as head of She was formerly partner at WolfBlock. which he founded. RECRUITER DHR International industry groups. He had been group Abby Wenzel, 49, joined as member. She Mitchell Lampert, 50, was named head of consumer industries and equity had been partner at WolfBlock. partner. He had been principal at the DOWNSIDE Fundraising during the economic crisis Crowell & Moring: private placements at Merrill Lynch. Barbara E. Champoux, Law Offices of Mitchell Lampert. UPSIDE Running a well-loved museum that has enhanced its Carl Mayer, 47, joined as head of 52, joined as partner. She had been Barry Perlman, 45, joined as partner. He leveraged finance. He had been head of partner at Sonnenschein Nath & had been of counsel at Fish & Richardson. stature and doubled its size with a building designed by starchitect leveraged finance capital markets at Rosenthal. Elaine Rogers, 47, was named partner. She Rafael Viñoly. Merrill Lynch. Kasowitz Benson Torres & Friedman: had been partner at Fish & Richardson. After 20 years with the museum and a year following the expan- Execution: Rick Bensignor, 50, joined as Patterson Belknap Webb & Tyler: Jeffrey R. Gleit, 33, was promoted to Daniel sion, President Carol Enseki announced in December that she chief market strategist, a new position. partner from associate. C. Glazer, 35, joined as counsel. He had He was formerly executive director and Charles M. Miller, 43, was promoted to been counsel at Shearman & Sterling. would leave in September. The new chief will need to continue to chief market strategist at Morgan partner from associate. boost the BCM’s international reputation as well as cultivate its role Stanley Principal Strategies. Joseph A. Piesco Jr., 36, was promoted to MEDIA & ENTERTAINMENT as a community leader in Crown Heights, Brooklyn. R.J. O’Brien: Jeffrey Bauml, 56, was named partner from special counsel. The Daily Beast: Brian Dick, 33, joined as —MIRIAM KREININ SOUCCAR senior vice president of soft commodities. Adina G. Storch, 37, was promoted to vice president of business development. He had been managing director of soft partner from special counsel. He had been strategic partner developer commodities trading at BNP Paribas. Christine A. Montenegro, 33, was at Google and founder of Google TV. Korn/Ferry International: John J. Keller, HIGH TECH 55, was named senior client partner. He IndoorDIRECT: Steven Justman, 40, joined EXECUTIVE PROMOTIONS had been senior director at Spencer Stuart. REAL ESTATE Development Co. as president of entertainment, marketing The fastest way to get an announcement into Public Theater: Nella Vera, 40, was named Cohen Brothers Realty Corp.: Steven Vantage Properties: Devin Aronstam, 34, and sales. He had been executive vice pres- Crain’s is to submit details online. Fill out the form director of marketing. She was formerly Cherniak, 56, was appointed a senior vice was named director. He had been ident/general manager at Cornerstone. at www.crainsnewyork.com/submit. The associate director of marketing at Center president. He was formerly chief principal at Lubert-Adler Partners. Proclivity Systems: Steve Booth, 45, was Executive Moves column is also available online. Theatre Group. executive at Solow Realty and —selena shen

June 1, 2009 | Crain’s New York Business | 23 s s s s $EDICATED"USINESS3PECIALISTSTOGETYOUTHEANSWERSYOUNEED FAST