The Trouble with Larry
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CNYB 04-13-09 A 1 4/10/2009 8:09 PM Page 1 INSIDE! Obama’s TOP STORIES greener Earth IMAX’s 3-D Day moment finally —Valerie Block arrives—no, really! ® Page 9 PAGE 3 Old Navy’s ship tossed about VOL. XXV, NO. 15 WWW.CRAINSNEWYORK.COM APRIL 13-19, 2009 PRICE: $3.00 on choppy seas PAGE 2 Curtis Sliwa takes tourists to seamier Did we hit bottom yet? side of New York sprout up here and there,”says Dawn NY, NY, PAGE 6 Local economy Fay, the firm’s district president. SPROUTING UP shows signs of life; Even as the city is battered by 63.4 68.1 64.8 SPECIAL REPORT rising unemployment, steep cuts in mayor declares consumer and corporate spending, turning point is here plummeting condo prices and a record drop in office rents, the first +7.2 pts +9 pts +33 pts glimmers of hope that the econom- BY DANIEL MASSEY ic free fall could be nearing an end NYC Consumer NYC Consumer 6-Month NYC Business are emerging.Based on surveys that Confidence, 1Q v. 4Q Future Confidence, Outlook, March v. Feb. Highest level in NYS; 1Q v. 4Q Also highest Highest level since for months after Wall Street’s track consumer and business confi- city is the only region level in the state—a May; shows markedly collapse last fall, client orders at the dence and reports from real estate that didn’t show a sign that consumers improved expectations New York offices of staffing agency and retail experts, signs of renewal year-on-year decline feel the worst is over for business activity Robert Half International dried up, appear to be poking through the Sources: Siena Research Institute, Nat’l Assn. of Purchasing Management-NY while inquiries from job seekers city’s recession-impacted soil. istockphoto skyrocketed.After the new year,the “I do think we are probably While some wrote off the may- thawing,dismal retail and auto sales SMALL BUSINESS dynamic slowly started to reverse: near the bottom,” Mayor Michael or’s comments as election-year pie- have picked up slightly, and stocks Fewer hopefuls walked through the Bloomberg said last week. “I don’t in-the-sky talk,there are indications have surged. Mortgage rates have Federal stimulus plan aims company’s doors, but clients quiet- know that the economy is going that the intensity of the downturn is hit an all-time low, and home sales to unlock credit, but some ly started hiring again. straight up from here, but I am get- beginning to ease up. Nationally, have begun to stabilize. entrepreneurs are yearning “We’ve seen the shoots starting to ting more optimistic every day.” credit markets have shown signs of See SIGNS on Page 10 for much, much more P. 11 G Washington’s recession treatment is the right medicine for this health Stemming THE NEGOTIATOR: technology company P. 13 Larry Silverstein G may need the Port Hits & Misses: Authority’s A go-between for beautifiers Wall St. financing help, but trades on high style P. 17 don’t think that means he holds a exodus weak hand. BUSINESS LIVES INTERVIEW NYC dilemma: HELL how to keep all Recession leaves that talent in town laid-off on job-hunt BY AARON ELSTEIN treadmill PAGE 21 lots of people cope with tough times by quaffing a cold beer or two. Drew Weinstein hopes folks will soon reach for one of his. Mr.Weinstein,who last October lost his job as a research analyst at in- vestment bank Cowen & Co., has INDEX said goodbye to Wall Street to take a shot at starting Magellanic Brew- THE INSIDER _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 4 ery. His plan is to hire other brew- buck ennis REAL ESTATE DEALS _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _5 eries to make his beer,a light lager he VIEWPOINT _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _8 describes as “a better Budweiser.” TOP COMMERCIAL BANKS _ _ _ _ _ _ _ _ _ _ _ _ _ _ _14 But what Mr. Weinstein may TOP THRIFTS _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _15 have in vision, he lacks in money CLASSIFIEDS _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _18 and experience. He needs to raise CORPORATE LADDER _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _22 The trouble with Larry $2 million to get his new venture WWW.CRAINSNEWYORK.COM hopping so it can compete with the /EXECMOVES EXECUTIVE MOVES nation’s 1,600 other small brew- See/EVENTS AT DEADLINECALENDAR on PageLISTINGS 2 eries. Beer is a tough business, the Why Silverstein refuses to cave on WTC terms See WALL STREET on Page 7 Trade Center site. 15 BY THERESA AGOVINO Today,Mr. Silverstein is on the verge of what could 5 be yet another epic fight.Although he’s earning fat de- sitting in his corner office with stunning views velopment fees at the site,troubled credit markets have ELECTRONIC EDITION of downtown and the harbor,Larry Silverstein exudes forced him to seek help from the Port Authority of a been-there, done-that calm. About to turn 78 next New York and New Jersey to finance two of the three month, he has spent the last eight years enduring multibillion-dollar towers he plans to construct over NEWSPAPER bruising battles with government officials over his the next six years. Sources say the Port Authority,leery 71486 01068 unfulfilled dream to rebuild the shattered World See SILVERSTEIN on Page 2 0 CNYB 04-13-09 A 2 4/10/2009 8:10 PM Page 1 IN BRIEF NEW YORK CITY’S MUNICIPAL HOSPITALS WILL Turning around Old Navy’s LOSE $277 MILLION IN STATE MEDICAID funding in fiscal 2010.They lost $66 million in fiscal 2009.The New York City Health and Economy major Hospitals Corp.’s 11 facilities are shouldering a disproportionate 56% of the $232 million in net obstacle as Gap’s Medicaid cuts to city hospitals, HHC President Alan Aviles said last week.The state budget once-hip value created several new charity-care funding pools totaling $300 million to help hospitals pay for division revamps treating uninsured patients, but the pools exclude public systems such as HHC. BY ADRIANNE PASQUARELLI CARAVAN TRANSIT, THE BROOKLYN SCHOOL-BUS old navy recently launched a campy com- COMPANY FEATURED in a Nov. mercial campaign featuring talking man- 16 Crain’s article, has run its nequins. Reviews are mixed, but the TV last routes. Owner Jeffrey spots are garnering buzz—something the DeStefano (right) closed the ailing chain has not been able to do for shop late last month, unable to some time. weather a recession that had “They’re doing something that’s get- sliced his company’s revenues in ting awareness half. A one-page document filed in federal out,” says Can- bankruptcy court in Brooklyn last week showed dace Corlett,pres- what’s left of the once-thriving company. A 12- ident of WSL ton hydraulic press, a dual-wheel dolly, a battery Strategic Retail. HOIST SALES: The brand is attempting to regain attention with its ad campaign (left). charger, a grease pump and gear lube are among Old Navy des- the items Mr. DeStefano hopes to sell to help perately needs the pay off creditors. “The last day was the worst help. Its clothing, Though some have a new option for affordable style. Now, day of my life,” he says. once quirky yet speculated that Gap Inc. other value-priced retailers,such as Kohl’s, wearable, has be- might unload the chain, Target and even Wal-Mart, have ramped ANOTHER JEWELER HAS GONE BANKRUPT. come dowdy and which has five New York up their offerings and stolen market share. ULTRA STORES INC., WHICH SELLS AT FASHION predictable. And City locations,experts con- “When [Old Navy] started, it had a lot discounter Daffy’s, Burlington Coat Factory, shoppers notice. tend that a sale is unlikely in of cool stuff you didn’t see in other places, John F. Kennedy International Airport and Same-store this market. but it’s harder and harder to do that now,” other locations, filed for Chapter 11 bankruptcy sales at the 15- Glenn Murphy, Gap Ms. Corlett says. protection late last week.The company cited year-old division Inc.’s chief executive, ex- Industry experts say Old Navy must re- assets of between $10 million and $50 million, have been nega- pressed confidence in the assert itself by improving its products.That and the same amount of liabilities and said it tive for 18 quarters.