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Fairway’s future P.5 | Banking on the Tonys P. 9 | Breaking up the old boys’ club P. 13

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HUNG OUT TO DRY Why cleaners are still using a toxic chemical decades after it was deemed to be potentially lethal PAGE 16

VOL. XXXII, NO. 19 WWW.CRAINSNEWYORK.COM

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FROM THE NEWSROOM | JEREMY SMERD Puerto Rico in the Bronx IN THIS ISSUE 3 AGENDA

PUERTO RICO’S DEFAULT ON a $422 million debt payment last 4 IN CASE YOU MISSED IT week drew the typical recriminations and vows of 5 FOOD

solidarity from the island of Manhattan, making me feel 8 REAL ESTATE The decade- rather cynical about politicians here who sound off on long boom in 9 SPOTLIGHT Chelsea may policies over which they have no control. Their voices finally be over 10 WHO OWNS THE BLOCK would be better used serving the Hispanic communities 12 they have been elected to represent. CONFERENCE COVERAGE Mayor Bill de Blasio urged New Yorkers to pester House 13 VIEWPOINTS Speaker Paul Ryan. “Congress 15 THE LIST must take action and allow Puerto Rico to restructure After living in the their debt in a way that strengthens its health system FEATURES and does not jeopardize workers’ wages,” he bellowed “Bronx for nearly six 16 STAIN ON THE INDUSTRY in a statement. years, Carmen 20 TAKEN TO THE CLEANERS City Council Speaker Melissa Mark-Viverito, who was Borges got a whiff of 24 GOTHAM GIGS born in Puerto Rico, called the situation “a humanitarian crisis”—the same phrase used by the island’s governor. the poverty she The real crisis of consequence to New York is a thought she had Nuyorican one. Hispanics are the largest demographic in escaped the city behind whites, but more than 25% of them live in poverty, surpassed (recently) only by Asians, according to the city’s Center for Economic Opportunity. The crisis in Puerto Rico does not appear to have sent New York a wave of P. 24 economic migrants. Those leaving the island as a result of the crisis are more PHILIP CASTALDI likely to go to Miami, according to journalist Eddie Borges, who is working on a book proposal about the poverty endemic to Hispanics living in the Bronx. 25 SNAPS Borges last week offered me his own insight into the dilemma. His mother 26 FOR THE RECORD came to New York from Puerto Rico in 1942. “After living in the Bronx for nearly 27 PHOTO FINISH six years, Carmen Borges got a whiff of the poverty she thought she had escaped and left behind on the island of enchantment,” he writes. “It had followed her to the mainland and taken root like the cilantro my mom used to make sofrito.” So they moved to Queens, where Eddie (named, like his brother, Robert, after a Kennedy) took advantage of public-school programs for gifted students. Now he’s back in the Bronx, and living there has jolted him. His solution to the poverty concentrated in housing projects is to create the kind of conditions Borges experienced in Queens, where New Yorkers of various classes and backgrounds benefited from being in the same school district. It may be too bold ON THE COVER a solution for any politician to utter, but New York, he says, should do what PHOTO: BUCK ENNIS Chicago did to the Cabrini Green housing projects: tear them down. “The Bronx as we know it,” he writes, “is unsalvageable.”

DIGITAL DISPATCHES Applications are open! DEADLINE MAY 23 Go to CrainsNewYork.com READ CRAIN’S FASTEST Amazon will bring its free same-day GROWING COMPANIES delivery service to the Bronx. The decision followed criticism from Borough President Each year, Crain’s recognizes the Ruben Diaz Jr. that minority communities are New York area companies left out of the company’s service. Meanwhile, with the highest three-year the tech giant said it will acquire as much as revenue growth rate. a 30% stake in Purchase, NY-based Atlas Air Public and private companies Worldwide Holdings in an effort to build its with at least $10 million transport and delivery network. in revenue are eligible. ■ Pregnant women can’t be kept SHOW EVERYONE HOW out of New York City bars or FAST YOU REALLY ARE refused alcoholic drinks just > CrainsNewYork.com/ because they’re expecting, ApplyFast50 under new city guidelines. LISTEN to a discussion of Vol. XXXII, No. 19, May 9, 2016—Crain’s New York Business (ISSN 8756-789X) is published weekly, except for double issues Broadway during the year of the weeks of June 27, July 11, July 25, Aug. 8, Aug. 22 and Dec. 19, by Crain Communications Inc., 685 Third Ave., New York, NY 10017. Periodicals postage paid at New York, NY, and additional mailing offices. Postmaster: Send address changes Hamilton, New York politics and to: Crain’s New York Business, Circulation Department, 1155 Gratiot Avenue, Detroit, MI 48207-2912. dry cleaning. Special guest Kam Saifi, CEO of For subscriber service: Call (877) 824-9379. Fax (313) 446-6777. $3.00 a copy, $99.95 one year, $179.95 two years. (GST Next Cleaners, talks about changes that could No. 13676-0444-RT) make the industry greener but more

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AGENDAWHAT’S NEW MAY 9, 2016 Candidates need to show the world what New York values really mean

nd then there were two. Hillary Clinton and Donald Trump have emerged as the all-but-certain Democratic and Republican presidential nominees, with Trump’s competition abandoning the Arace and the delegate math rendering Sen. Bernie Sanders a virtually hopeless long shot to catch Clinton. As it happens, both Clinton and Trump are New Yorkers. Unfortunately, their adherence to New York values has been spotty. MEASURING UP: Hillary Clinton and Donald Trump, both New Yorkers, have not But there are six more months for them to shape up. always lived up to our ideals. But there’s still time. One of our favorite New York values is honesty. New Yorkers are known to speak their minds. Candidates for office rarely do so, even gerous path of xenophobia and even violence. in New York, for fear of offending voters or donors. But Trump has Which brings us to the New York values of diversity and inclusion. shown bluntness on the stump to be an asset. People appreciated it The city is famous as a melting pot and a gateway to America. As a haven when he explained how his contributions to politicians bought some for immigrants and the safest big city in the U.S., it disproves Trump’s measure of fealty. Unfortunately, his honesty overall has been more slanderous characterization of Mexicans as killers and rapists, and perception than reality. Fact-checkers Muslims as terrorists. have documented that only 9% of what New Yorkers work hard and speak their New York initially became a great city he says is true or mostly true. minds. We know how to rally people because of trade, which Trump threatens to Meanwhile, polls show Clinton is wide- to a cause, and we appreciate the choke off with high tariffs—a heavy-handed ly perceived as dishonest, probably tool universally rejected by economists and because she avoids giving forthright the benefits of diversity frowned on by the business community. answers that she believes will hurt her— Trade creates far more jobs than it destroys; not realizing that the lack of candor is more damaging. technology, more than overseas competition, is responsible for the long- New Yorkers also value leadership. Often that means adopting term decline in U.S. manufacturing jobs. The eminently knowledgeable unpopular positions and bringing constituents around to them. We Clinton understands this, but hesitates to deliver the message with don’t see much of that from Clinton, whose every statement and straight talk. stance seems to be first tested for safety and resonance by internal It’s a rarity that the presumptive Democratic and Republican presi- polls and focus groups. Trump, meanwhile, has been putting his lead- dential nominees are both from New York. We hope the two candidates ership skills to odious use, encouraging his followers down the dan- will represent what’s best about us. – THE EDITORS

FINE PRINT A report last week proclaimed that Brooklyn is in the midst of a job boom in architecture (up 90%) and graphic design (up 94%). But that growth has something to do with its tiny base. The number of jobs at its architecture and design firms came to 1,954 in 2014, the last year for which numbers are available. The total in Manhattan was 24,045. Citywide it was 27,037.

BY GERALD SCHIFMAN STATS 25 WORDS OR LESS GREAT WHITE WAY, INDEED DIVERSITY TOOK A BACKSEAT on Broadway during its 2014-2015 season, although I’d much rather Lin-Manuel Miranda’s acclaimed Hamilton, which moved to the Great White Way CITY AND THE “ this season from the off-Broadway Public Theater, has bucked the trend. get pulled over Portion of Broadway actors in the 2014-2015 season who were white, up 3 percentage by a white officer 78% points from the previous season

than a black Portion of Broadway actors who were officer in New African-American, down from 21% in 9% 2013-2014 York City, based on Share of traditionally white roles cast my experience to minority actors, down 1 percentage 10% point from the prior season —Glenn Martin, an African-American advocate for criminal-justice reform, African-American actors’ share of citing his numerous traffic stops by Public Theater roles in 2014-2015, the the NYPD. 51% highest of any company. Minorities filled 62% of roles, also the highest

ADDICTED TO NUMBERS? GET A DAILY DOSE AT @STATSANDTHECITY SOURCE Asian American Performers AP IMAGES, BLOOMBERG Action Coalition

MAY 9, 2016 | CRAIN’S NEW YORK BUSINESS | 3 20160509-NEWS--0004-NAT-CCI-CN_-- 5/6/2016 7:59 PM Page 1

AGENDA ICYMI CRAINS EDITOR IN CHIEF Rance Crain publisher, vp Jill R. Kaplan assistant to the publisher Alexis Sinclair, 212.210.0701 EDITORIAL editor Jeremy Smerd Could Silver have beaten the assistant managing editors Erik Engquist, Peter S. Green, Jeanhee Kim web editor Amanda Fung rap and avoided prison? copy desk chief Steve Noveck art director Carolyn McClain photographer Buck Ennis HELDON SILVER must be asking “What if?” Last week, senior reporters Joe Anuta, Aaron Elstein, Matthew Flamm, Daniel Geiger he was sentenced to a 12-year prison sentence for reporters Rosa Goldensohn, Jonathan LaMantia, Caroline Lewis, corruption, but what if he’d blocked the ethics bill Addie Morfoot S data reporter Gerald Schifman that forced him to reveal how much outside income he web producer Peter D’Amato columnist Greg David was making while speaker of the state Assembly? contributing editors Tom Acitelli, Preet Bharara Theresa Agovino, Barbara Benson, Perhaps U.S. Attorney would never have Erik Ipsen, Judith Messina, investigated and Silver would still hold his legislative Cara S. Trager ADVERTISING post, rather than be chained to a post. www.crainsnewyork.com/advertise advertising director Irene Bar-Am But more transparency might have saved Silver from [email protected] or 212.210.0133 conviction and still let him cash in. Prosecutors empha- senior account managers sized the steps Silver took to conceal what they called a Zita Doktor, Jill Bottomley Kunkes, Rob Pierce, Stuart Smilowitz quid pro quo, in which he steered $500,000 in state account managers Jake Musiker senior marketing coordinator grants to a mesothelioma doctor who referred patients LeAnn Richardson sales/events coordinator Ashlee Schuppius with lucrative asbestos claims to Silver’s law firm. Had the grants been public rather than hidden in 212.210.0282 [email protected] budget documents, and had Silver disclosed the true size and nature of his fees rather than funneling ONLINE them to eight different accounts and claiming to have done actual legal work, the speaker wouldn’t general manager Rosemary Maggiore 212.210.0237 have looked so guilty. The politics would have been bad, but Silver endured bad press for years anyway. [email protected] CUSTOM CONTENT It’s also possible that the cancer expert would have referred patients to Silver’s firm even if he had director of custom content Patty Oppenheimer 212.210.0711 not received a grant—after all, he had known Silver since the 1980s and referred patients for years after [email protected] the Assembly money ran dry. Silver also could have asked his firm to give the clinic research grants, a EVENTS www.crainsnewyork.com/events legal arrangement used by a rival firm to which the doctor began referring patients in 2010. director of conferences & events Courtney Williams, 212.210.0257 Things couldn’t have turned out worse for Silver, 72. He must spend his twilight in prison and pay $7 [email protected] million, erasing his ill-gotten gains and his pension. — ERIK ENGQUIST manager of conferences & events Adrienne Yee AUDIENCE DEVELOPMENT director of audience & content Mayor lawyers up DATA POINT partnership development Hudson Yards development will cost Michael O’Connor, 212.210.0738 The de Blasio administration retained $200 million—triple the amount that [email protected] THE CITY HAD 15 FEWER MURDERS white-shoe law firms Debevoise & was originally estimated three years CRAIN’S 5BOROS www.5boros.com Plimpton and Carter Ledyard & AND 49 FEWER SHOOTINGS IN THE ago. Related Chairman Stephen Ross Irene Bar-Am, 212.210.0133 Milburn to represent it in “law FIRST FOUR MONTHS OF THIS YEAR said the Thomas Heatherwick- [email protected] enforcement inquiries” including a designed sculpture “will become to SPECIAL PROJECTS federal investigation into the COMPARED WITH THE SAME PERIOD New York what the Eiffel Tower is manager Alexis Sinclair 212.210.0701 [email protected] mayor’s nonprofit fundraising LAST YEAR, ACCORDING TO to Paris.” (See conference coverage REPRINTS activities. The firms are helping the on Page 12.) reprint account executive Krista Bora COMPSTAT DATA. – AMANDA FUNG 212.210.0750 city cooperate with the multiple PRODUCTION inquiries. So far, Mayor Bill de production and pre-press director Blasio has not been named in any of Simone Pryce media services manager Nicole Spell the probes. SUBSCRIPTION CUSTOMER SERVICE Nights at the opera www.crainsnewyork.com/subscribe Meal with your paper The discovery that Lincoln Center [email protected] 877-824-9379 (in the U.S. and Canada). To offset declining print revenue, The President Jed Bernstein had a rela- $3.00 a copy for the print edition; or $99.95 New York Times will partner with tionship with a staff member led to one year, $179.95 two years, for print subscriptions with digital access. meal-delivery startup Chef’d to give his departure. Lincoln Center initial- to contact the newsroom: readers the chance to buy ingredients ly said Bernstein stepped down to www.crainsnewyork.com/staff from its NYT Cooking website. The pursue a change in career. Bernstein, 685 Third Ave., New York, NY 10017-4024 phone: 212-210-0100 fax: 212-210-0799 site gets about 7 million monthly 61, was forced to resign because he Entire contents ©copyright 2016 users and contains more than 17,000 violated human-resources policy by Crain Communications Inc. All rights reserved. ®CityBusiness is a registered recipes. Meal kits for two cost being in a consensual relationship trademark of MCP Inc., used under license between $19 and $39. with a marketing executive whom he L-train woes agreement. had promoted twice. CRAIN COMMUNICATIONS INC. Nickel-bagged The Metropolitan Transportation BOARD OF DIRECTORS Authority is mulling two proposals chairman Keith E. Crain It was tight, but the City Council Cablevision takeover proceeds president Rance Crain to shut down the L-train tunnel voted 28-20 to require stores to The city is expected to approve Altice’s treasurer Mary Kay Crain, Cindi Crain between Manhattan and Brooklyn executive vp, operations William Morrow charge 5 cents for plastic and paper $17 billion acquisition of Cablevision. executive vp, director of strategic bags, effective Oct. 1. Opponents of The European telecommunications to repair damage from Hurricane operations Chris Crain Sandy. One would close the entire executive vp, director of corporate the bill called it a tax that unfairly company agreed to upgrade infra- operations K.C. Crain punishes the poor, while supporters structure in upper Manhattan and the tunnel for 18 months and the other senior vp, group publisher David Klein would close one tube at a time for vp/production, manufacturing David Kamis said it will help the environment outer boroughs. The Federal chief financial officer Thomas Stevens and reduce waste. The city spends Communications Commission signed a three-year period, which would chief information officer Anthony DiPonio more than $12 million a year ship- off on the takeover earlier this month. reduce train service by 80%. Both founder G.D. Crain Jr. [1885-1973] ping 91,000 tons of disposable bags options are creating angst among chairman Mrs. G.D. Crain Jr. [1911-1996] secretary Merrilee Crain [1942-2012] to out-of-state landfills, according Big Apple’s pricey Eiffel Tower commuters and businesses. to the council. Some purchases will A sculpture that will become the Repairs would begin in early 2019.

BUCK ENNIS, BLOOMBERG be exempt. centerpiece of Related Cos.’ massive

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AGENDA FOOD

27—and Fairway said a How Fairway plans to refocus “competitive opening on the Upper East Side” after a quick bankruptcy was a big reason for that. Fairway executives Must reassess locations and draw new customers BY AARON ELSTEIN intend to use its sojourn in bankruptcy court to here will be manna from heaven. Rumor is, it’s going to cut its $279 million debt cheese. And “I’m starting to see be the BEST one so far!” burden in half and free olive oil and subway ads for the new But after a Whole up resources to invest fresh flowers. UES Fairway,” one per- Foods Market set up in its business and win TFairway’s reorganiza- son tweeted, according shop a block away last droves. Companywide, 2015—including a back the shopping tion isn’t expected to be to DNAInfo. “Yay for year, customers aban- sales at stores open more painful 7.5% drop in the carts of New Yorkers. a contentious one. After new grocery options! doned that Fairway in than 12 months fell in quarter ended last Dec. Wish them luck. Ⅲ filing for Chapter 11 on May 2, the grocer pledged to continue paying in full all employees, suppliers and landlords. The only parties who figure to suffer big losses are Fairway’s lenders, most of whom have already have agreed to swap their Carine Joannou PRESIDENT debt for shares in the JAMIS BICYCLES reorganized company. “There’s not going to be a lot to fight over,” said Peter Schaeffer, a retailing expert and principal at financial advisory firm GlassRatner. Going forward, Fairway has to decide which of its 15 locations should be closed and how to lure customers back into the Steering her others. The company said last week that it does company forward. not plan to close any stores, but the grocer has not made a profit since its initial public offering three years ago. It clearly needs to reassess after its ambi- Understanding tious expansion. Schaeffer said the Fairway in Woodland what’s important. Park, NJ, could be closed because the location doesn’t fit with the upscale image that the grocer pres- Honoring her father’s legacy has been a priority for Carine since taking over Jamis Bicycles. And she’s done just that, ents in the city. Perhaps an even steadily growing the company. So when it came time to choose a new bank, she wanted a financial partner that could harder problem is per- help her continue to succeed. Carine found that in M&T Bank. We’ve put in the time to truly understand both her company suading New Yorkers to take a fresh look at and the biking industry to determine what Jamis needs to keep moving ahead. To learn how M&T can help your business, Fairway. The store rose visit mtb.com/commercial. to prominence a decade ago because its high- quality everyday and gourmet items present- ed a refreshing contrast for Manhattanites resigned to tired old A&P or Sloan’s. When Fairway opened a mar- DEPOSITORY AND LENDING SOLUTIONS | TREASURY MANAGEMENT | MERCHANT SERVICES | COMMERCIAL CARD ket in a former Barnes & Noble on East 86th Street in July 2011, its Equal Housing Lender. ©2016 M&T Bank. Member FDIC.

BUCK ENNIS arrival was greeted as

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AGENDA REAL ESTATE

Aéropostale’s departure could be sign of Times Square trouble

Rents hit $2,000 a foot in tourist mecca, while sales flag BY DANIEL GEIGER

he teenage fashion mar- sublet it, rather than pay rent believed The Gap will ket—as fickle as teenagers to be about $20 million a year. A leave a similarly- themselves—is changing spokesman for Express said the com- sized space, at the face of Times Square, pany can claw back $9 million of the the Knicker- TAmerica’s hottest retail location. $11 million termination fee if it finds a bocker Hotel at Clothier Aéropostale announced it subtenant. West 42nd Street and Broadway. foot flagship is in the base of a 54- is closing its Times Square location, Vornado Realty Trust also has a “The high-value corridors like story office tower at 1515 Broadway just days after filing for bankruptcy roughly 36,000-square-foot block of Times Square, Broadway in SoHo, the owned by SL Green Realty Corp. It protection, leaving yet another retail space remaining at the base of meatpacking district and Madison was not immediately clear when potentially empty storefront in one the Marriott Marquis at Broadway and Avenue have all seen rents rise to a Aéropostale will vacate the space of the city’s highest-traffic shop- West 45th Street. And Toys R Us left its level where it curtails demand,” said and whether it will pay a penalty to ping destinations. Rents in Times 100,000-square-foot store on the east Gene Spiegelman, a vice chairman at do so. Aéropostale, once a staple of Square have hit $2,000 per square side of Broadway late last year. The Cushman & Wakefield who oversees suburban malls, filed for Chapter 11 foot, among the highest in the city. Gap and Old Navy have since leased the firm’s national retail leasing bankruptcy after years of steadily Now, Express, which relocated its some of that, but about 70,000 square practice. “Retailers want to be here, losing market share to H&M, flagship store to the landmarked I. feet remain available, said Brad but you need equilibrium back,” he American Eagle Outfitters and Miller Building at 1552 Broadway in Mendelson, a broker at Cushman & said of New York. Forever 21—all of which also have 2014, is leaving its space and trying to Wakefield who is marketing the space. Aéropostale’s 19,000-square- prominent Times Square stores. Ⅲ

according to a recently finished The rezoning was the first under appraisal for the trust. That’s enough the city’s new rules requiring devel- to pay for restoring deteriorating opers to build affordable housing in steel piles under the pier that threat- exchange for density bonuses. en the integrity of the structure, Roughly a third of East New York whose sports fields are a key amenity residents earn too little to qualify for in the neighborhood, most units the affordable-housing The developers want the air plan is designed to build, said the left- rights to boost the bulk of a complex leaning New York Communities for they are planning at St. John’s Change, which wanted more afford- Terminal, a three-block-long build- able housing. ing between Washington and West Espinal said the plan will create streets. They will only buy the air 1,200 new apartments for individuals rights if they win a zoning change to earning as little as $18,000 and fami- permit up to 1 million square feet of lies earning up to $69,000. He said the market-rate residential develop- group should stop “playing politics.” ment, 300,000 square feet of affordable and senior housing and Developer Aby Rosen settles tax bill 400,000 square feet of commercial for art PEERLESS LOCATION: Google will fill offices above an Anthony Bourdain food court at Pier 57 space, which could include retail, Real estate developer Aby Rosen (artist’s rendering). offices and a hotel. agreed to settle New York state claims that he did not pay sales and Safer construction sites use taxes on fine art. Rosen, who Pier 57? Google it. 4,000 jobs, said Boston Properties. Construction firm Gilbane Building controls the Seagram Building and Mayor Bill de Blasio officially wel- The city aims to have 16,000 jobs at Co., is calling for all workers on job Lever House, agreed to pay $7 mil- comed Google’s expansion of its the Yard by 2020. sites in New York state to hook into lion, New York Attorney General Eric Chelsea campus to the new devel- safety harnesses when they are Schneiderman said. opment taking place farther west, HBO landlord seeking investor working more than six feet above Schneiderman said Rosen bought on the Hudson River Park at Pier 57. With HBO set to depart 1100 Sixth ground—a policy the firm says has or commissioned more than $80 mil- The tech giant, which has more Ave. for Hudson Yards in three years, saved the lives of 20 workers on its lion of contemporary art since 2002, than 5,000 employees in New York, the building’s longtime landlord, the sites over the past five years. claiming the pieces were for resale was named the anchor tenant of the Nickerson family, is looking for and not subject to sales tax. Instead, soon-to-be-rehabilitated pier last investors to take over the property. Park Slope hospital levels brownstones he used the art for personal enjoy- year. It will have 250,000 square The family, which has owned the for $445 million expansion ment and to enhance the value of his feet of office space at the Eleventh site since the 1800s, when it was New York Methodist Hospital has properties. Avenue and West 15th Street loca- just farmland, has hired Darcy begun demolishing brownstone tion when its $350 million renova- Stacom, a broker at CBRE, to market townhouses it owns on Eighth In brief tion is completed next year. a leasehold of the 15-story, Avenue in Park Slope, Brooklyn, The city will lease empty land at 315,000-square-foot building that despite fierce opposition from local public-housing developments to Brooklyn tech hub construction begins could stretch as long as 99 years and residents, after the city approved its private developers, who will build Rudin Development and Boston reap hundreds of millions of dollars plan to build a smaller clinic than nearly 500 apartments for low- Properties broke ground last week for the Nickersons. originally proposed. income tenants, primarily the eld- on a 675,000-square-foot commer- erly. Three buildings will be built on cial office building in the Brooklyn Pier 40 air rights Councilman’s rezoning trouble parking lots and green space near Navy Yard that will be anchored by Developers Westbrook Partners and An activist group vows that more than housing developments in the Bronx co-working behemoth WeWork. Atlas Capital Group agreed to pay the 100 volunteers will knock on doors and Brooklyn. ... The Bank of China Construction on the building, Hudson River Park Trust $100 million every Saturday until the 2017 election to will move this fall into 7 Bryant which will rise 16 stories, is expected to acquire 200,000 square feet of air punish City Councilman Rafael Espinal Park, an office tower it bought in to wrap up by the end of 2017. When rights over Pier 40, even though the for his role in rezoning his East New 2014 for $600 million.

AP IMAGES, RXR operational, the building will hold rights are worth only $75 million, York, Brooklyn, neighborhood. — STAFF REPORTS AND WIRES

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AGENDA SPOTLIGHT ENTERTAINMENT

Struggling to make a buck SEEING STARS Carmen Cusack and in the year of Hamilton Paul Alexander Nolan as an ill-fated couple Bright Star to borrow money and bet on lift from Tony nods BY PHILIP BOROFF in the South .

very year, the announcement of Tony nominations forces producers of struggling shows to make tough choices. But the unprecedented dominance of Hamilton this year makes Bright Star’s decision to hang on in the hopes of a Tony payoff seem even more of a gamble. EThe original musical, set in the 1920s and 1940s American South, was written by Steve Martin and Edie Brickell and earned five Tony nominations on May 3. Now, instead of potentially closing the show after 10 weeks of losing money, producers are wagering that the nominations will spur ticket sales. But they have to put more money in the pot to even take this chance. To that end, the production will raise cash to run at least through the 70th Annual Tony Awards presentations on June 12, advertise its nominations and stage a musical number on the CBS telecast. The last expense alone typically runs into six figures. “It’s not a secret that we’ve been having less-than-robust grosses,” lead producer Joey Parnes said in an interview. “To say we’re an underdog is an understatement.”

Seeking a sliver of the limelight Weighing in this year’s calculus for Broadway producers is the unprecedented Hamilton juggernaut. The hip-hop musical about the nation’s first treasury secretary received 16 nominations, the most in Tony history, and is expected to clean up at the ceremony at the Beacon Theatre. That means Bright Star is very unlikely to upset Hamilton for best new musical; its strategy now is to make the most of being named among the top five. The production also received nods for lead actress Carmen Cusack, who It’s not a secret New York Times critic Charles Isherwood that we’ve been wrote is making “a simply gorgeous “ Broadway debut”; the show’s script, by having less-than- Martin; its score, by Martin and Brickell; and its orchestrations, by August robust grosses. Eriksmoen. To say we’re an Isherwood wrote that the show, with its bluegrass-inflected score, has brought underdog is an “a fresh breeze from the South to the understatement spring Broadway season.” Theatergoers are not drifting into seats, however. For the week ending May 1, like the previous nine weeks, sales were at less than half the Cort Theatre’s capacity. Its weekly gross has averaged $370,000, according to the Broadway League, a trade association. Around $35,000 of that, on average, goes to union pension-fund contributions, credit-card processing and other pass- through fees the production doesn’t pocket. Weekly operating expenses, which include actor and musician salaries, and stagehands’ pay, are about $500,000, according to a budget obtained by Crain’s. The show’s initial production costs were about $10 million. Parnes said Bright Star was temporarily able to reduce expenses, including royalties and rent. It plans to take out a priority loan—which is repaid before any money is distributed to the original investors—from some of its roughly two dozen producers (who are investors or bundlers of investors). FOCAL POINTS Parnes said details of how much to borrow and the new advertising budget aren’t set, but don’t expect costly full-page ads in the Times. LOCATION Cort Theatre, 138 W. 48th St. Past performances do not guarantee future results LEAD PRODUCERS John Johnson, Joey Parnes and Sue Wagner There is precedent for struggling best-musical nominees to be able to ANOTHER PRODUCER OF NOTE Len Blavatnik, the Ukraine-born extend their runs after their casts perform numbers at the Tony cere- billionaire who bought Warner Music Group in 2011 monies. Parnes, who also produced the 2013 sleeper hit and best musical Tony-winner, A Gentleman’s Guide to Love & Murder, cited 2006’s The DISTINGUISHED PEDIGREE Steve Martin wrote the book and co-wrote the Wedding Singer and 2007’s Xanadu. Both were stage adaptations of hit music and story; his previous plays include Picasso at the Lapin Agile and The movies, however. Bright Star is all new, and its most salable features are Underpants, and he wrote the screenplays for some of his movies, including The Jerk. Edie Brickell wrote the lyrics and co-wrote the music and story; the debut the creative team of Martin and Brickell and, now, the nominations. album of Edie Brickell & New Bohemians, Shooting Rubberbands at the Stars, sold Parnes maintained that there’s no crystal ball that signals how long to more than a million copies and produced the hit “What I Am,” co-written by Brickell. run a show that’s in the red and whether it finds an audience. “It has to do with a whole alignment of things that have to work in your favor,” he A STAR IS BORN Carmen Cusack, a Tony nominee for best lead actress in a said. But there are already signs that his bet may pay off. Bright Star sales musical, is making her Broadway debut. on nomination day were twice its typical box-office draw for a Tuesday, EXPERIENCE IN SPADES Parnes has had two stints as executive director said Parnes. He declined to quantify them. of the Public Theater, most recently in 2011. Ⅲ NICK STOKES “I’m a Tony believer,” he added.

MAY 9, 2016 | CRAIN’S NEW YORK BUSINESS | 9 20160509-NEWS--0010-NAT-CCI-CN_-- 5/6/2016 2:49 PM Page 1

AGENDA WHO OWNS THE BLOCK REAL ESTATE

100 11TH AVE.

End of the line in west Chelsea More than a decade after rezoning, the last developable parcels are filling in around the High Line

BY TOM ACITELLI

n 2005, the city rezoned a vast swath of west Chelsea, from West 17th to West 30th streets, between 10th and 11th avenues. The city also gave a 551 W. 21ST ST. Igreen light to the conversion of the 532 W. 20TH ST. Scott Resnick’s SR Capital derelict 11th Avenue rail viaduct into bought the site in October 2012 The 4,600-square-foot, one-story build- the High Line park. for $32 million. With air rights ing traded twice in the past 10 years. In from 508 W. 20th St., SR built The twin moves altered the neigh- February 2005, Manhattan-based a 44-unit condo complex, com- borhood, then best-known for art gal- investor Alf Naman bought the property pleted in 2015. Several of the for $3.5 million. In 2014, Naman sold it leries, light industry and car repair condos are now in contract, for $20.21 million to developer DDG. including three penthouses ask- 522-532 W. 21ST ST. shops. Buildings and parcels started ing more than $40 million each. trading hands, and many became the Siras Development and Oriel Development bought this site with a two- sites of new condos. Nearly 20 projects have story commercial building in April 2013 either gone up, are underway, or are planned in for $35 million. Using air rights from west Chelsea, adding thousands of luxury hous- 508 W. 20th St., they are erecting an 11-story condominium called the Soori ing units. High Line, with private pools in 16 of its The sale of air rights 27 units. Prices range from $3.5 million from low-lying buildings 100 11TH AVE./535 W. 19TH ST. (no pool) to $15.1 million (penthouse abutting the High Line has with a pool). Curtis Bashaw and Craig Wood’s Cape helped fuel the boom in Advisors bought the plot of land for this tall condos in the quarter. condo building for $47 million in December Typically, air rights can be 2005. Architect Jean Nouvel called his 23- story, 72-unit condo tower there “a vision sold only to an adjacent machine” for the views from its 1,750 win- building, but in 2005, the dowpanes. It opened in 2010, a year late New York Post reported, and at least $50 million over budget. the city let those owners sell their air rights to pre- serve open space along the elevated park. In mid-April, developer DDG filed plans to turn the one-story art gallery it owns at 532 W. 20th St. into an 11-story, nine-unit luxury 531 W. 19TH ST. 500 W. 21ST ST. condominium. The 14,950-square-foot, two-story Sherwood Equities acquired the DDG acquired the site in commercial building houses a talent site next to the High Line in May October 2014, effectively agency and a music-equipment ven- 2010 for $25.3 million, a year after it bought a loan on the drawing to a close a buying dor. In the 1980s, it was the Kamikaze nightclub. Developer property worth $24 million. spree of developable lots in the Keith Jacobson bought it for $14.3 Sherwood then took control of neighborhood. million in December 2005. the property through foreclosure proceedings. A one-story garage “Most of the stuff has been was replaced with the 31-unit spoken for—the big, juicy ones 500W21 condo. are gone,” said Jeffrey Katz, CEO of Sherwood Equities, which has built in the area. Ⅲ 508 W. 20TH ST.

505 W. 19TH ST. AND 511 W. 19TH ST. Sherwood Equities bought the four-story commercial building in April 2011 for HFZ Capital Group bought these parcels in $7.3 million from Shalom Azani, who had December 2012 for $46.25 million with the owned it since the 1980s. Sherwood Carlyle Group, hiring Danish architect sold the air rights for $9.2 million and Thomas Juul-Hansen to design a condo com- used the building as a sales office for its plex. The 35-unit 505W19 consists of two 10- condo project at 500 W. 20th St. It now story buildings connected by a lobby, which leases the space as a showroom to runs underneath the High Line. Available Italian tile company Bisazza. units include a $6.3 million three-bedroom and a $22 million four-bedroom penthouse. WWW.OASISNYC.NET, BUCK ENNIS

10 | CRAIN’S NEW YORK BUSINESS | MAY 9, 2016

20160509-NEWS--0012-NAT-CCI-CN_-- 5/6/2016 2:50 PM Page 1

AGENDA CONFERENCE REAL ESTATE

Building solutions for the challenges facing the city A billionaire developer, a senator and a former deputy mayor tell all, while sparks fly over the future of affordable housing and Penn Station

crowd of 470 executives packed into a conference room at the Sheraton Times Square last week to hear from leading real estate figures on the most pressing issues facing the city. They were not disappointed. Offered here are excerpts from those Aconversations. Our plenary panelists—Related Cos. Chairman Stephen Ross, Sen. Charles Schumer and Sidewalk Labs CEO (and former deputy mayor) Dan Doctoroff—talked about the making of the megadevelopment at Hudson Yards. Ross’s comments that he would build condos not rentals if the state did not renew the 421-a tax break drew ire during the following panel from Building and Construction Trades Council of New York President Gary Ross, Schumer and Doctoroff LaBarbera. Our Penn Station panelists later said that Gov. Andrew Cuomo’s plans to redesign the station were better than the do-nothing status quo.

TAKING THE MEASURE OF HUDSON YARDS A LIMITED PENN STATION BEFORE THE CONFERENCE, RELATED COS. published an analysis MAKEOVER IS BETTER THAN NONE pegging Hudson Yards’ eventual economic impact at $18.9 billion, including $89 million a year toward transit. “The fundamen- Economist James Parrot said the report should not have tal problem that included the value of taxes paid by companies that we’re all dealing relocated to the site from another part of town. with is, for 40 years we’ve done nothing.” Gary LaBarbera THE LOSS OF AN AFFORDABLE-HOUSING TAX BREAK: — TONY COSCIA, chairman of STEPHEN ROSS: “If we don’t have a tax abatement or a Amtrak, a partner CAN RENTAL HOUSING BE BUILT WITHOUT replacement of 421-a, you will see a lot more condos being in the Cuomo plan. Tony Coscia A TAX BREAK LIKE 421-A? AND SHOULD IT built, and it will be much more like the model they use in He said it would INCLUDE A PREVAILING-WAGE MANDATE Europe, where there’s very little rental housing available. take parallel efforts to relieve congestion FOR CONSTRUCTION WORKERS? I really believe, at some point in time, people will reach an and improve the station experience. agreement and recognize that it’s cheaper today to build GARY LABARBERA: “There were projects that nonunion. ... Unless there is something, we will not be were receiving 421-a and selling penthouse building rentals or affordable housing.” apartments for $90 million. That’s a problem. We believe where there are public FILLING EMPTY OFFICES: subsidies there need to be public “The governor’s responsibilities.” SEN. CHARLES SCHUMER: “I’m not worried about competition plan is for a between downtown and the West Side. If competition limited aesthetic NEW YORK CITY DEPARTMENT OF brings rents down and we bring more companies and create change rather HOUSING PRESERVATION AND more jobs here for average folks, so much the better. ” than really deal- DEVELOPMENT COMMISSIONER ing with the VICKI BEEN: “Does a tax RELATED’S PLAN FOR A $200 MILLION SCULPTURE BY situation with THOMAS HEATHERWICK AT HUDSON YARDS: Gina Pollara break need to require a track capacity.” prevailing wage? There ROSS: “We have a plaza that’s bigger than [London’s] should be a price for the — GINA POLLARA, president of the Vicki Been [tax] exemption, and the Trafalgar Square. ... The sculpture will become to New York Municipal Art Society, expressing price for the 421-a exemption [should be] what the Eiffel Tower is to Paris, I believe. It will be very concern that rail-system improvements 25% to 30% affordable housing. We believe iconic.” are taking a backseat to commercial it’s a fair price and it would get rental and political interests. TIME TO BUILD THAT NO. 7 LINE STATION AT 40TH STREET housing built.” DAN DOCTOROFF: “Hudson yards will make so much money that “The challenge is REAL ESTATE BOARD OF NEW we could go back now and borrow to pay for that second to build in a way YORK PRESIDENT JOHN BANKS: station.” that does not “You cannot build rental SCHUMER: “I’m going to publicly lobby the de Blasio preclude larger housing in the city of New administration. Our revenues are pretty good. One of the options later. York without a tax subsidy. best uses for that money would be to now start preparing to What we can do And if you could, you’d see build that station, particularly now that there’s talk of today … should John Banks it being done, and it’s not development north of 41st Street. This will create huge not be a barrier being done.” benefits, far more than the cost of building that extra for making criti- LABARBERA: “You want us to believe that all station.” cal infrastructure Chris Ward these developers who are building rental [improvements].” are doing it out of the goodness of their RENAME HUDSON YARDS ROSS CENTER? — CHRIS WARD, heart? I don’t think so. Not once have we DOCTOROFF : “I have joked with Steve, ‘Look, Hudson Yards is senior vice president, AECOM, and mentioned what’s the margin, how much the Rockefeller Center of the 21st century.’ Personally, I former executive director of the Port money are they making. We only talk about think he ought to name it after himself.” Authority of New York and New Jersey workers making less.” ROSS: “Next question.”

12 | CRAIN’S NEW YORK BUSINESS | MAY 9, 2016 20160509-NEWS--0013-NAT-CCI-CN_-- 5/6/2016 3:13 PM Page 1

AGENDA VIEWPOINTS

Disputed tax break should PROPERTY-TAX BURDENS never have been necessary Effective tax rate1 Single-family homes2 $0.77 If the city fixed its unjust property taxes, it wouldn’t need 421-a for rental housing Co-ops in small buildings $1.30 Co-ops in large buildings $0.97 LAST WEEK, the housing is unfairly taxed.” verted to co-ops in the 1980s, and Rentals with elevators $3.60 three sides in the The Independent Budget Office, as condo construction accelerated, contentious debate which has been shining a spotlight politicians moved to extend the Rental walk-ups $4.50

over property-tax on the system’s disparities for lower tax rates to those kinds of SOURCE Independent Budget Office breaks, affordable years, told a legislative committee residences as well. But apartment 1-Per $100 of market value housing and the use earlier this year that the tax rate for renters don’t see a tax bill—they 2-Includes two- and three-family homes of union labor rental buildings with elevators blame their landlords for what they squared off at the ranges from three to five pay—so there was never a After all, the only way to do that GREG DAVID Crain’s real estate times the rate for single- political incentive to do the would be to raise taxes on home- conference with family homes, co-ops and same for rentals. owners to benefit renters. angry words, competing statistics condos. Walk-up rentals The controversial and Today, there is no interest in and a few charges of bad faith. But pay even more. While land- 35 now-expired 421-a, which doing so. Mark-Viverito told the YEARS since lost in the back-and-forth was the lords may absorb some of gave new units a break on Crain’s event in February that the NYC’s last fundamental reason that a tax break the burden, most of it is property-tax those absurd property taxes council had little appetite to tackle of some sort is crucial for building paid for by tenants through overhaul by phasing them in over the issue. Been, the housing com- rental housing: The city’s property- higher rents. approximately two decades, missioner, figuratively threw up her tax system is completely inequit- Simply put, property-tax was the only way to make hands, saying, “We’ve been trying able. rates make it impossible to build construction of rental buildings to attack that problem since 1981, Don’t believe me. “We all know rental housing without a tax break. economical. It is why 421-a lasted but it’s not going to happen in the the property-tax system is unfair,” This sorry state of affairs began in various incarnations from next two, three or four years.” Council Speaker Melissa Mark- with levying very low taxes on sin- administration to administration. But if New York did fix its prop- Viverito said at a Crain’s event in gle-family homes as part of an effort At least a few high-ranking offi- erty-tax system, a major tax break February. Housing Commissioner to keep the middle class from flee- cials in the Bloomberg administra- wouldn’t be needed. Ⅲ Vicki Been reiterated the point at ing to the suburbs. (The favorable tion wanted to attempt property- last week’s session, saying, “The treatment helped offset the city’s tax reform, but the mayor never GREG DAVID blogs regularly at reason we need 421-a is that rental income tax.) As buildings were con- was willing to take on the issue. CrainsNewYork.com.

Old-boy network is keeping our union overwhelmingly male and white

Good jobs are hard for minorities, women to engineer BY AVERIL MORRISON, JANENNE GONZALEZ AND DELISA JONES

ew York is a melting pot Apprentices spend months taking place”—that’s what one of of many different cul- classes and watching other people us was told by a union offi- tures. On May 9, we’re work on equipment before they take cial when seeking going to court to deter- jobs on their own. employment for the first Nmine why the city’s construction But in the Operating Engineers, a time. “How did you get unions don’t reflect this diversity. small but significant loophole can into Local 14?” white co- As minority females in the accelerate the process. Job seekers workers often ask. International Union of Operating who are sponsored or referred by an Unions were intended Engineers Local 14-14B, we know existing worker can bypass the to create a level playing firsthand that the union fails to pro- apprenticeship program altogether field for workers—espe- mote the diversity we see every day cially in the hiring hall, where work is work, we understand that the oppor- in Manhattan, Brooklyn or Queens. assigned. Access to the highest-paying tunity to earn a living should not be The Operating Engineers Local 14- Job seekers referred by and longest-lasting jobs is supposed to based on who you know, who in your 14B has 1,600 people in its member- members bypass the be allocated on a first-come, first- family is “connected,” or the color of ship book. Fewer than 20 of them are served basis. But in the Operating your skin. minority females. Overall, white apprenticeship program. Engineers, white members are paid That’s why we have decided to workers make up more than 90% of well to operate bulldozers, cranes and speak out against racial discrimination the union—a portion that has been It’s a golden ticket for other heavy machinery. Hourly pay in our workplace. In 2012, we filed a relatively unchanged since the 1980s. friends and family and benefit rates range from roughly discrimination complaint in federal This is not a coincidence; it is a $70 an hour for unskilled jobs to $120 court against Operating Engineers direct consequence of union leader- an hour for skilled positions. Local 14-14B, making clear that our ship building barriers to equal and earn higher journeyman wages on This favoritism translates into less union intentionally blocked minority opportunity for nonwhite workers. the job. This is called being “on per- lucrative work for people of color, workers from moving up in their Look no further than the union’s mit,” a golden ticket for friends and because union leadership manipulates careers. apprenticeship program. For work- family of the union’s overwhelmingly who gets which jobs in the hiring hall. As members of that community, we ers like us, apprenticeships mean white membership. They benefit from White male workers typically secure want to change the Operating opportunity. They’re supposed to their connections, while people of the most desirable jobs—such as the Engineers—and all unions—for the teach us the skills of the trade and color languish as apprentices. World Trade Center and other major better. Ⅲ prepare us for full-time, well-paid Oftentimes, apprenticeship classes building projects—while their minori- union membership—paving the are made up almost entirely of minority counterparts can be out of work for Averil Morrison, Janenne Gonzalez and way for career advancement and ties. Some have no white participants. months on end. Delisa Jones are members of the upward mobility. These programs This creates a culture of exclusion. “I After spending as much time as we International Union of Operating

BUCK ENNIS typically require patience: believe you came to the wrong have to get past apprenticeship-level Engineers Local 14-14B.

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An Advertising Supplement to Crain’s New York Business

Business_Dining_May.indd 1 5/2/16 5:06 PM 20160509-NEWS--0015-NAT-CCI-CN_-- 5/6/2016 3:19 PM Page 1

AGENDA THE LIST TOP NEW YORK CITY GOVERNMENT CONTRACTS Ranked by fiscal 2015 contract value

CONTRACT VALUE RANK VENDOR WEBSITE (IN MILLIONS) AGENCY PURPOSE METHOD INDUSTRY

New York City Economic Development Corp. nycedc.com $1,686.1 DSBS Citywide economic development Sole source Professional services 1 110 William St., New York, NY 10038 services (212) 619-5000 Kiewit Corp. kiewit.com $706.6 DEP Delaware-Rondout Aqueduct bypass Competitive Construction services 2 470 Chestnut Ridge Road, tunnel sealed bid Woodcliff Lake, NJ 07677 (201) 571-2500 YMS Management Associates Inc. ymsmanagementassociates.com $452.7 ACS Payment agent for ACS voucher Negotiated Professional services 3 160 Broadway, New York, NY 10038 programs acquisition (212) 835-7610 extension Sullivan Land Services Ltd. sullivaninterests.com $292.7 DDC Construction services for Hurricane Request for proposal Professional services 4 13 Evia Main, Galveston, TX 77554 Sandy-related residential community (713) 880-9888 recovery, Staten Island Tishman Construction, an AECOM company tishman.com $281.5 DDC Construction services for Hurricane Request for proposal Professional services 5 100 Park Ave., New York, NY 10017 Sandy-related residential community (212) 708-6800 recovery, Queens LiRo Group liro.com $275.5 DDC Construction services for Hurricane Request for proposal Professional services 6 3 Aerial Way, Syosset, NY 11791 Sandy-related residential (516) 938-5476 community recovery, Brooklyn Mill Basin Bridge Constructors n/a $263.7 DOT Reconstruction of the Mill Basin Bridge Competitive Construction services 7 421 E. Route 59, Nanuet, NY 10954 and Belt Parkway in Brooklyn sealed bid New York City Economic Development Corp. nycedc.com $237.5 DSBS Citywide maritime economic Sole source Professional services 8 110 William St., New York, NY 10038 development services (212) 619-5000 Tully Environmental Inc. tullyconstruction.com $181.3 DSNY Export of municipal solid Competitive Standardized services 9 (Tully Construction Co.) waste from Queens sealed bid 127-50 Northern Blvd., Flushing, NY 11368 (718) 446-7000 Waste Management of New York wm.com $171.6 DSNY Export of municipal solid waste from Competitive Standardized services 10 1001 Fannin St., Houston, TX 77002 Brooklyn sealed bid (713) 512-6200 Southland Renda Joint Venture scitunneling.com $142.6 DEP Schoharie Reservoir low-level outlet, Competitive Construction services 11 608 Henrietta Creek Road, upstate New York sealed bid Roanoke, TX 76262 (607) 588-4080 Waste Management of New York wm.com $128.7 DSNY Export of municipal solid waste from Competitive Standardized services 12 1001 Fannin St., Houston, TX 77002 Brooklyn sealed bid (713) 512-6200 Wheeled Coach Industries Inc. wheeledcoach.com $114.6 DCAS FDNY ambulances Competitive Goods 13 2737 Forsyth Road, Winter Park, FL 32792 sealed bid (407) 677-7777 FJC Security Services Inc. fjcsecurity.com $114.3 HRA Task order for citywide security guards Task order Standardized services 14 275 Jericho Turnpike, Floral Park, NY 11001 and related services (516) 328-6000 DeFoe Corp. defoecorp.com $105.8 DOT Reconstruction of Harlem River Drive Competitive Construction services 15 800 S. Columbus Ave., Viaduct between East 127th Street and sealed bid Mount Vernon, NY 10550 Second Avenue (914) 699-7440 IESI New York Corp. local.progressivewaste.com/new-york $86.7 DSNY Export of municipal solid waste from Competitive Standardized services 16 (Progressive Waste Solutions) Brooklyn sealed bid 330 Seventh Ave., New York, NY 10001 (212) 268-1322 Waste Management of New York wm.com $83.3 DSNY Export of municipal solid waste from Competitive Standardized services 17 1001 Fannin St., Houston, TX 77002 Queens Waste Management of sealed bid (713) 512-6200 New York Public Health Solutions healthsolutions.org $80.0 DOHMH Administrator for community-based Request for Professional services 18 40 Worth St., New York, NY 10013 human services public health solutions proposal (646) 619-6400 American Recycling Management n/a $70.8 DSNY Export of municipal solid waste from Competitive Standardized services 19 17-233 Douglas Ave., Jamaica, NY 11433 Queens sealed bid (718) 739-2301 Koch Skanska Inc. skanska.com $69.8 DOT Construction services for Hurricane Emergency Construction services 20 400 Roosevelt Ave., Carteret, NJ 07008 Sandy-related restoration of (732) 969-1700 12 movable bridges United Metro Energy Corp. unitedmetroenergy.com $62.1 DCAS Bulk delivery to procure heating oil Accelerated Goods 21 500 Kingsland Ave., Brooklyn, NY 11222 and bioheating oil (718) 383-1400 IESI New York Corp. local.progressivewaste.com/new-york $60.1 DSNY Export of municipal solid waste from Competitive Standardized services 22 (Progressive Waste Solutions) Brooklyn sealed bid 330 Seventh Ave., New York, NY 10001 (212) 268-1322 Motorola Solutions Inc. motorolasolutions.com $59.8 DOITT Task order, emergency communications Task order Goods 23 13131 31st Ave., Flushing, NY 11354 transformation program (718) 886-8231 Women In Need Inc. winnyc.org $54.1 DHS Standalone shelter Request for Human services 24 115 W. 31st St., New York, NY 10001 services for families in proposal (212) 695-4758 East New York, Brooklyn Allied Barton Security Services alliedbarton.com $49.1 DOT Procure uniformed armed security guard Task order Standardized services 25 161 Washington St., services Conshohocken, PA 19428 (484) 351-1300

Source: Mayor’s Office of Contract Services. Additional research by Gerald Schifman. Data are based on contracts for fiscal year 2015. n/a-Not available. ACS-Administration for Children’s Services; DCAS-Department of Citywide Administrative Services; DDC-Department of Design and Construction; DEP-Department of Environmental Protection; DHS-Department of Homeless Services; DOHMH-Department of Health and Mental Hygiene; DOITT- Department of Information Technology and Telecommunications; DOT-Department of Transportation; DSBS-Department of Small Business Services; DSNY-Department of Sanitation; HRA-Human Resources Administration

MAY 9, 2016 | CRAIN’S NEW YORK BUSINESS | 15 20160509-NEWS--0016,0017-NAT-CCI-CN_-- 5/6/2016 2:58 PM Page 1

SMALL BUSINESS | DRY CLEANING A STAIN ON THE The toxic chemical that New York’s dry cleaners can’t seem to quit BY AARON ELSTEIN AND INDUSTRY PETER D’AMATO BUCK ENNIS

16 | CRAIN’S NEW YORK BUSINESS | MAY 9, 2016 20160509-NEWS--0016,0017-NAT-CCI-CN_-- 5/6/2016 3:56 PM Page 2

artha Montalván arrived city’s approximately 400 from Ecuador in 2002 at perc dry cleaners located age 19 and worked 12 in apartment buildings, LEAD INVESTIGATOR: Judith hours every day except according to a 2009 study. Schreiber thought perc would be phased out when she first Sunday at a dry cleaner on The same report found that started working on the issue East 109th Street, where residents of neighbor- 20 years ago. She was wrong. she was paid $300 a week hoods with a lot of these in cash. That came out to $4.16 per hour, well shops have 15% higher Mbelow the minimum wage, but as an undocu- rates of kidney cancer, mented immigrant who couldn’t speak English, though further research is she didn’t have better options. needed to definitively After three years of washing, folding and establish a link. Upper- packaging shirts, she began experiencing dizzy floor apartments and spells and headaches. The skin on her face neighboring buildings can turned red and hot, and the washing machines’ have high perc readings nonstop rumbling damaged her hearing. She because the vapor travels worked a fourth year at the shop, then quit through elevator shafts when she got pregnant. “It was just four years and air vents. of my life,” Montalván said in Spanish. “But it Most people are aware had a very strong impact.” of perc only when they The most visible signs are the hearing aids smell the sweet chemical the 33-year-old wears. Worse is the internal scent at a dry cleaner or in damage that medical experts said is consistent someone’s closet. Wearing with years of exposure to the hazardous solvent dry-cleaned clothes is not that most New York City dry cleaners use to considered hazardous wash clothes, a pollutant that regulators have because the chemical’s been trying to phase out for nearly 20 years. presence is typically low. Montalván’s liver is damaged and she can no The risk comes from inhal- longer eat foods seasoned with salt, pepper or ing a steady dose over anything spicy. Her doctor ordered her to avoid time. Many people have no any work that involves handling chemicals, idea if they’re exposed which means hair-salon or office-cleaning jobs because the human nose are off-limits. She now works at a restaurant. can’t detect perc until concentrations reach “You just figure that if there are these danger- “I fell into it,” said Montalván of her dry- 6,000 micrograms per cubic meter—200 times ous chemicals polluting your apartment, that cleaning job. “There’s nothing I can do about the recommended maximum. you just complain and the city will fix things,” that now.” She added that her 9-year-old “It’s very insidious,” said Judith Schreiber, she said. “It’s an apartment, not some industrial daughter is healthy. former chief scientist at the New York state factory, right? But it didn’t work that way.” There are 10,000 people who work in the attorney general’s Environmental Protection approximately 3,500 dry cleaners where New Bureau and one of the nation’s leading investi- 2020 deadline Yorkers get their suits and dresses laundered. gators on the health effects of perc. “People just Dry cleaners are required to post a sign say- Workers in one of every five of these shops are don’t realize they are being exposed to perc ing they use perc, but landlords’ obligations to exposed daily to a chemical that the U.S. because they don’t smell anything.” tell tenants if there’s an issue are less clear. Environmental Protection Agency deems a Nora Nealis, executive director of the State Health Department guidelines say “rea- “likely carcinogen” that can harm the liver, National Cleaners Association, said perc is not a sonable and practical actions should be taken” kidneys and blood, and the when perc exceeds typical indoor immune, reproductive and cen- levels of under 10 micrograms per tral nervous systems. California AFTER WORKING 12 HOURS, SIX DAYS A cubic meter, and the state “rec- banned the solvent in 2007. Jack ommends taking immediate Nicholson turned into the Joker WEEK FOR THREE YEARS, MONTALVÁN action” when levels exceed 300 when he fell into a vat of the stuff HAD DIZZY SPELLS, HEADACHES AND micrograms per cubic meter. But in the first Batman movie. That these are not requirements. The chemical is called perchloroeth- SEVERE LIVER DAMAGE city does not regularly monitor ylene, or perc. For the majority of dry-cleaning emissions, and since the 1,200 dry cleaners in the city the start of 2011, according to that do their work on-premises, it is the go-to threat to most New Yorkers. She said health documents obtained by Crain’s under the ingredient for getting stains out. But for dry- standards are based on worst-case assumptions Freedom of Information Law, city health cleaner workers and New Yorkers living nearby, that seldom play out, such as residents living inspectors have received about 250 complaints airborne perc is a hidden hazard that remains near dry cleaners for multiple decades and for dry cleaners, laundromats and residential well above acceptable levels—despite efforts by never leaving their apartments. “A dry cleaner laundry rooms, underscoring how much perc New York to rein it in after the EPA in 1993 is a safe neighbor,” Nealis said. must be in the air before people can smell it. started regulating how dry cleaners use the Mori Mickelson and her husband began “We are concerned about the health of people chemical. smelling perc from the dry cleaner directly who may have been exposed to perc and will con- below their Upper West Side apartment shortly tinue to respond to residents concerned about Triple acceptable levels after they moved in 21 years ago. They com- possible exposure to elevated levels of perc,” said A 2013 study in the journal Environmental plained, and a year later the city sealed the a spokesman for the city Health Department. The Research showed average perc readings of 106 shop’s perc machine, forcing it to ship clothes city’s Department of Environmental Protection micrograms per cubic meter in low-income to an industrial laundry. But the shop continued inspects dry cleaners every three years, a New York households near dry cleaners, more to spot-clean with perc and to press clothes still spokesman there said, adding that shop employ- than triple the limit of 30 micrograms per cubic damp with the solvent. When a small amount of ees are supposed to examine vents daily to ensure meter recommended by the New York state perc remaining in the sealed machine spilled perc isn’t escaping. Department of Health. Children are especially out, Mickelson nearly passed out while nursing Federal environmental authorities concluded vulnerable to perc because they inhale more air her infant son. They were taken by ambulance a decade ago that perc dry cleaners in apart- relative to their size than adults, and ingest it to a hospital, where doctors found her lungs had ment buildings pose an unacceptable health risk from their mothers when nursing. been burned by perc. Still, the dry cleaner and must vacate nationwide by 2020. Even with Perc isn’t just a problem for poor people who stayed open until last year. The odor has finally the deadline looming, hundreds of dry cleaners live near or work in dry cleaners. Some 2.3 mil- faded away, but Mickelson worries about long- in the city continue to use perc. “Nothing is

BUCK ENNIS lion New Yorkers live within 650 feet of the term health effects from the lengthy exposure. CONTINUED ON PAGE 18

MAY 9, 2016 | CRAIN’S NEW YORK BUSINESS | 17 20160509-NEWS--0018,0019-NAT-CCI-CN_-- 5/6/2016 2:52 PM Page 1

SMALL BUSINESS | DRY CLEANING

better,” said Wayne Edelman, owner of Meurice Sundays because its Garment Care, which cleaned Princess Diana’s owners are Buddhist. clothes. “There are alternatives and we use a lot To hold the line on of them, but perc, used correctly, is tried-and- costs, Lee parks his true.” 2003 Toyota Corolla on Perc’s persistence also says a lot about the the street every morn- sorry state of many of the dry cleaners that are a ing—he can usually find fixture of the New York streetscape. Rising a spot because his day rents, higher labor and utility costs, and flat or starts at 5 a.m.—and falling revenues are slowly leading to the clo- drops off orders on his sure of these shops, many of them single store- way home at night. His fronts that generate as little as $200,000 in delivery area is every- annual revenue. The response to fading fortunes where in Manhattan is to pay workers as little as they can [see story south of 125th Street. on page 20] and put off spending tens of thou- “Everyone is fighting sands of dollars on non-perc machines and the for everything,” he sprinkler systems required by the fire code said. when machines are replaced, an additional cost Most dry cleaners of as much as $100,000. feel the same way. Over “Cleaners want to make the change, but the past 10 years, the many can’t afford it,” said Nealis. industry’s revenues Said Kam Saifi, chief executive of Next nationwide have sunk Cleaners, a chain of about 20 dry cleaners that by 13%, or $1.4 billion, doesn’t use perc: “This is an industry caught in according to research a negative spiral.” firm IBIS, which pre- dicts another 6% Pressed for profits decline through 2020. Dry cleaning dates back to the mid-19th cen- The culprit: People are tury, when it was discovered that camphene, a buying fewer clothes fuel for oil lamps, was great at removing greasy that require dry clean- NEXT GEN: Kam Saifi’s solution is called Green stains from fabric. Because such fuels are explo- ing, and in New York, Earth. While better than sive, fire codes confined commercial dry clean- competition is so stiff perc, environmentalists ers to the edges of towns. Perc, developed in the that owners struggle to say it’s not really green. 1930s, was a leap forward because it was non- increase prices fast flammable. After World War II, dry cleaners enough to offset rising began popping up in residential neighborhoods costs. across the country. There are now 40,000 The last thing Lee wants to hear is how he ing machine finds its way into nearby apart- nationwide, and nearly one in 10 are in New needs to spend a lot of money to buy new ments each year, and researchers concluded York City. machines that don’t use perc. His perc that airborne perc posed a much greater public In the 1970s, the first generation of owners machines are 20 years old, typically an age at health threat in urban areas than groundwater started selling out to Korean immigrants who which they leak lots of vapor. He minimizes perc because people breathe air more often than arrived in large numbers after Congress in 1965 exposure by keeping the machines quarantined they drink water. abolished country-specific immigration quotas. behind a glass wall, which needed repair on a The EPA started to regulate how dry cleaners Dry cleaning required minimal knowledge of recent visit. Replacing both dry-cleaning handle perc in 1993, three years after Congress English, and the shops were traditionally closed machines would cost $150,000, an investment revised the Clean Air Act and the agency beat on Sundays. That made them attractive to that, Lee said in late March, he was delaying back a lawsuit from cleaners, Shell Oil and Dow Koreans, many of whom are practicing making in the hope that the EPA’s 2020 dead- Chemical. Dow was a major perc manufacturer Christians. Though newer immigrant groups line would be pushed back. It happens that the until last December, when it sold most of its chlo- like Chinese and Latinos are now making industry has a lengthy track record of stalling rine business for $5 billion. inroads, the dry-cleaning industry in New York regulations that would limit perc use. After protracted negotiations between public remains more than 60%-owned by health officials and mom-and- Korean-Americans, said Pyong Gap pop owners worried about being Min, a sociologist at Queens College “IT’S VERY INSIDIOUS. PEOPLE JUST forced out of business, New York and director of the Research Center DON’T REALIZE THEYARE BEING state unveiled new rules for perc for the Korean Community. dry cleaners in 1997. Old machines Daniel Lee’s dry-cleaning busi- EXPOSED TO PERC BECAUSE THEY had to be replaced with models ness on East 23rd Street still does that wash and dry clothes, elimi- most of its work on-premises. (The DON’T SMELLANYTHING” nating the need for workers to majority of his competitors are haul vats of perc-saturated appar- “drop shops” that ship clothes to an el between machines, and fans industrial laundry.) Every day, 150 customers “The thing about perc is people really don’t had to be installed inside perc machines to capture come through his doors, dropping off 350 items care,” Lee said over breakfast. “They want the vapor so workers wouldn’t inhale a plume when for dry cleaning. Each pays an average bill of job done right and don’t care much about how they opened the doors. Dry cleaners were given around $30. If buttons or seams are loose, it’s done.” until 2005 to comply with the rules, in part because someone from his staff of 13 will sew them tight. there weren’t enough new machines available for Temperatures are constantly monitored so A 40-year saga everyone who needed them. clothes aren’t pressed too hot, a common error Regulators began scrutinizing perc in the The same year New York unveiled perc regu- that makes suits shiny. 1970s, when they started examining how dry lations, a janitor named James Doherty was Even with the steady stream of business, Lee cleaners and industrial users contaminated assigned to work at a Harlem building that once said, profit margins have dropped to 10% from groundwater and soil by dumping buckets of housed an industrial dry cleaner and—briefly—a their historical high of 33%. Rent is $16,000 a used solvent down drains. Many of these pol- public school. After less than a year on the job, month and utilities run about another $6,000. luted areas are now federal Superfund sites. his urine turned bright red with blood and he His labor costs will increase by more than 50% Looking at perc vapor, regulators found that checked into a hospital, where he spent 20 over the next three years as the minimum wage even the most conscientious dry cleaners strug- days: His kidneys had failed. In 2000, Doherty rises to $15 an hour, from $9. What’s more, gled to contain leaks from machines that by and his wife, Rosemary, sued the building there’s a Chinese-run laundry around the cor- their nature shake and rattle. As a rule of owner for exposing him to perc and sought $2

BUCK ENNIS ner that charges half as much and is open thumb, roughly 10% of the perc in a dry-clean- million. The landlord countered that James’

18 | CRAIN’S NEW YORK BUSINESS | MAY 9, 2016 20160509-NEWS--0018,0019-NAT-CCI-CN_-- 5/6/2016 2:52 PM Page 2

FACTS

problems were caused by pre- “We want to give dry cleaners According to Peter Sinsheimer, executive existing conditions. “There were 3,500 technical and marketing help so director of the sustainable-technology and pol- causality issues,” recalled the they can retool and retrain,” he icy program at UCLA, the best alternative is NUMBER OF dry cleaners in Dohertys’ attorney, Alexander said. “The industry is archaic and professional wet cleaning. This process com- New York city, employing Sansone. The Dohertys eventually about 10,000 workers stuck.” bines water with biodegradable cleaning agents settled for $150,000; though, after Next Cleaners, like many shops in dedicated washers, dryers and pressers to fees, they took home just $50,000. that position themselves as “eco- wash apparel typically labeled “dry clean only.” James, now 74, spends three-and- friendly,” uses a solvent called He said wet cleaning can successfully wash a-half hours a day, three days a Green Earth, which is essentially 99.9% of garments previously dry cleaned, week, on a dialysis machine. “It’s 1,200 microscopic sand particles. Green though many dry cleaners don’t like wet clean- not the greatest life,” said NUMBER OF dry cleaners Earth is certainly better than ing, which requires separate machines for Rosemary Doherty, “but what can with on-site cleaning. Sixty perc, but the Natural Resources washing and drying and a new set of skills. A you do?” percent of these shops still Defense Council has described it 2011 study by the New York State Pollution The Dohertys’ case helps illus- use perc, exposing workers as “not really green” because Prevention Institute showed that 71% of dry trate why people seldom sue dry and neighbors to a California officials have said its cleaners in New York think wet cleaning can’t cleaners or landlords for the dam- hazardous solvent active ingredient, decamethyly- clean all garment types, and 65% said other sol- age caused by perc. Because the clopentasiloxane, or D5, has been vents do a better job on certain clothes. chemical is so pervasive and linked to uterine cancer in rats. linked to many different maladies, Earlier this year, European Union Symptoms vanish showing cause-and-effect is hard- authorities moved to restrict its Sinsheimer’s research has shown that er than it is for exposure to use in personal-care products like California dry cleaners who weaned themselves asbestos, which is strongly linked shampoos and shower gels. Green off perc and embraced wet cleaning reported to mesothelioma. Earth’s manufacturer says on its that their persistent headaches or dizzy spells As the years went by, regulators website that its product poses no disappeared and their utility bills dropped. continued tightening the screws risk to human health. “D5 is one “With wet cleaning, you’re talking about some- on perc, but slowly and haltingly. of the most extensively studied thing that’s better for the environment, makes In 2006, the EPA gave perc dry materials in consumer applica- people feel better and really cleans clothes cleaners 14 years to get out of tions,” the company said. well,” he said. “Isn’t that what we’re after?” apartment buildings. A year later, Other perc alternatives have One reason the public may not seek out pro- California banned the solvent— their own issues. A common sub- fessional wet cleaning more often is that care effective in 2023. In 2008, New stitute called hydrocarbon, labels on clothes seldom recommend it. Those Jersey considered banning perc starting in 2021, branded as EcoSolv or DF-2000, is a petroleum- labels are regulated by the Federal Trade but dry cleaners protested and the state backed based product manufactured by Chevron and Commission, and Sinsheimer has long advocated down. “Perc can be contained. The risk can be Exxon. A greener alternative made from lique- that the agency add a wet-cleaning option when managed,” Nealis of the National Cleaners fied carbon dioxide is too expensive for most appropriate. “If apparel is labeled ‘dry clean Association told trade publication American dry cleaners. Both Green Earth and liquefied only’ when it can be wet cleaned, that’s decep- Drycleaner at the time. “There is no reason to carbon dioxide require a lot of heat and pres- tive to the customer,” he said. The FTC held a phase it out, and we’re going to push back. sure, making them unappealing options for hearing on the matter in 2014—it had conducted We’re not going to let them take it away from many dry cleaners in apartment buildings. another back in 1999—but hasn’t ruled yet. A us—not without a fight.” In 2010, the New York City Council held a spokesman said he had “no idea” when it might. hearing on how to regulate dry cleaners who Meanwhile, perc abides. Safe alternatives marketed themselves as “organic” but nothing “When we started working on this in the Instead, New Jersey began offering dry came of it because of disagreements over what mid-1990s, I thought we’d fix everything in a cleaners financial incentives to replace perc the term meant. In the context of food, “organ- few years,” said Schreiber, the retired state sci- machines. About $6 million in grants have been ic” refers to something raised without pesti- ence official. “A generation later, we’re still handed out and 262 machines removed. New cides, but in the chemistry world, “organic” trying to fix this. And another generation has York had such a program but it lapsed around means anything made from carbon. been contaminated.” Ⅲ 2000, when the money ran out, said Nealis, adding that if the state or city revived it, the line of dry cleaners seeking help “would stretch all the way to Washington.” Some local cleaners are biting the bullet and buying new machines. A few weeks after his interview with Crain’s, Lee decided to buy non- perc machines and is awaiting approval from INVESTING IN AN UPGRADE: the apartment building that houses his shop to Daniel Lee spent about $150,000 to replace install them. The new machines might eventu- hazardous machines. ally help bring new business, but for now they mainly represent a hefty cost. That’s why the cleaners making the move to cleaner tech, like Next Cleaners’ Saifi, are the ones with money. Before launching the chain, the 55-year-old native of Iran was a venture- capital and operations executive at Morgan Stanley. He then led a Manhattan-based soft- ware company that was acquired early last decade for more than $400 million. Next Cleaners has about 20 drop shops around the city that funnel clothes to a plant in Kearny, NJ. The Radio City Rockettes send their laundry to Next Cleaners, and Saifi is busy persuading dry cleaners and corporate clients to route orders to his plant, which currently washes 40,000 shirts a week and has capacity for 300,000. He hopes Next Cleaners will consolidate the industry by becoming the standard for customers looking

BUCK ENNIS for a more environmentally friendly cleaner.

MAY 9, 2016 | CRAIN’S NEW YORK BUSINESS | 19 20160509-NEWS--0020-NAT-CCI-CN_-- 5/6/20163:14PMPage1

BUCK ENNIS 20 | RI’ E OKBUSINESS YORK CRAIN’S NEW ESTA IIU AE SAYMINIMUM WAGE, LESS THAN BY AARON ELSTEIN AND PETERD’AMATO MORE THAN HALF OFWORKERS OFWORKERS HALF MORE THAN cleaners cleaners LABORERS ANDADVOCATES NTEIDSR MAKE INDUSTRY IN THE Taken to theto | A ,2016 9, MAY U a.m. andclosingat7p.m. “It lookedlikeIwas involved openingthedoors sixdaysaweekat7 Street called65ModernFrench Cleaners.Hisjob ning thecounteratadropshoponEast65th was putinchargeofthestore.Soonherun- cleaning wasn’tsobad,andtwoweekslaterhe some deliveries.A$38tipmadehimthinkdry One day,themanageraskedifhe’dliketomake dry cleanerwherehe’dhadhissuitcleaned. crashed in2008,hestartedhangingoutatthe lost hisoffice-workerjobastheeconomy towels aroundtheirheads,”Johnnysaid. can reach110degrees.“Peoplewrapsoaked ventilated, andonsummerdaystemperatures er jobintheindustry.Manyshopsarepoorly complains aboutpayorconditionstogetanoth- employees, makingithardforanyonewho drycleanieros Dionicio askedformore,hesaid,wasfired. $1,000 tohelppaythe$12,000hospitalbill.When a heartattackonthejob.Hisemployeroffered $9 minimumwage.Thisyear,atage32,hesuffered week. That’sstillonly$7.50anhour,lessthanthe said inSpanish.Henowmakes$450fora60-hour hour. “Ittookmefiveyearsjusttoreach$300,”he cleaner’s, earning$260aweekorabout$5.40an working eight-hourshifts,sixdaysaweekatdry last namepublished,cametoNewYorkin2003, one Iknowhasgottenasuit,”Leesaid. their bossesforunpaidwagesthat“almostevery- Project. Somanydry-cleaningworkershavesued the reportbyNationalEmploymentLaw hairdressers, maidsoranyothergroupstudiedin That wasworsethanforchild-careproviders, ers werebeingpaidlessthantheminimumwage. 57% ofthecity’sdry-cleaningandlaundrywork- many ofwhicharemom-and-popoperations. shops haveslashedprofitsatmanydrycleaners, in acitycrowdedwith3,500dry-cleaning ing costs,higherrentsandintensecompetition problems wouldleadtodeportation,whileris- because immigrantworkersfearthatreporting have beenafactoflifeindrycleaningforyears mer employeesandputeveryoneonthebooks. company settledalawsuitbroughtbytwofor- When FilipinoimmigrantErnieAguinaldo His friendJohnnysaidowners— Dionicio, anativeofMexicowhodidn’twanthis A 2010studybyalaboradvocacygroupfound Poor wagesanddismalworkingconditions mum wage.Thatchangedwhenhis to payhisworkerslessthanmini- 23rd Streetdry-cleaningshopwas Lee keptexpensesdownathisEast ntil fouryearsago,onewayDaniel —share listsoftroublesome workers fairly. cleaning shopandpay his He hopesto openhisown dry- employer for wage theft. suedhisformer Aguinaldo LEFT HANGING: Ernie to runadrycleaner,theright way.”Ⅲ an Americandream,”Aguinaldo said.“Mineis and payemployeesafairwage. “We’veallgot how muchcashflowhe’llneedtorunhisshop with himandhascalculatedtothelastnickel network ofFilipinoimmigrantsreadytowork money inadry-cleaningbusiness.He’sgot Should hewinincourt,planstoinvestthe who saidHuangwasinChina. Oceanport, NJ,wasansweredbyahousekeeper 911. Acalltoherwaterfrontresidencein assets asafurcoat,RolexwatchandPorsche workers amonghercreditorswhilecitingsuch al bankruptcy.Herpetitionliststhedry-cleaning will, becauseinFebruaryHuangfiledforperson- about $220,000inunpaidwagesanddamages. lings HumbertoandLediaPerezwereawarded Employees AlbertoGonzalez,AliMuroandsib- an EastSidechain,suedownerDaisyHuang. businesses, fourworkersatSplendidCleaners, culty ofrecoupingwagesfromdry-cleaning with dry-cleaningworkeradvocates. including drycleaningandhashelddiscussions which aspokesmansaidwillexamineindustries Task ForcetoCombatWorkerExploitation, Going to court Going tocourt labor inspectors. whelmed,” Rodriguez-Aransaidofthestate help, butthey’lltellyoutheyarejustover- group. “They’regoodpeoplewhowantto Laundry WorkersCenterUnited,anadvocacy Rosanna Rodriguez-Aran,co-directorofthe months tofollowuponacomplaint,said cally takesoneofits200inspectorsseven investigate workplaceconditions,butittypi- probably theowner,”shesaid. more than40hoursaweekatdrycleaner,it’s neighborhood drycleaners.“Ifanyoneisworking more commoninlargeindustriallaundriesthanat Cleaners Association,saidwage-theftissuesare theft caseagainstadrycleanerwas13yearsago. last timeNewYorkauthoritiesbroughtawage- are pendinginfederalcourtManhattan.The one inthisbusinessisgettingcheated.” brother tome,”Aguinaldosaid.“Almostevery- man Itrusted,awhowaslikeanolder Lai, refusedtocomment.“Iwascheatedbya $35,000 inbackpay.Liao’sattorney,Thomas September, AguinaldosuedLiao,seekingabout robbed thestore,Aguinaldo’slawyersaid.Last called thepolice,claimingAguinaldohad worth ofovertime.Liaothenfiredhimand letter, complaininghehadn’tbeenpaidyears’ was unresponsive.Aguinaldowrotehisbossa began askingabouttheworkpermit,butLiao Aguinaldo’s weeklypayhadrisento$675.He residence status. sor Aguinaldo’sapplicationforpermanent- card. Theowner,ShihLiao,promisedtospon- aid hiscaseforaworkpermitorevengreen and hopedthatarecordofpayingtaxeswould a taxpayer-identificationnumberfromtheIRS Aguinaldo waspleasedtohearthat.He’dgotten the shopownersaidhewithheld$100fortaxes. week incash,andhetookhome$450because “because Iwas.” in chargeoftheplace,”Aguinaldosaid, What Aguinaldoisafterhisownshop. They haven’tcollectedandprobablynever In onecaselastyearthatillustratesthediffi- Gov. AndrewCuomolastJulyformedthe It’s thestateDepartmentofLabor’sjobto Nora Nealis,executivedirectoroftheNational At leasthalfadozenlawsuitslikeAguinaldo’s After fiveyearsofworking72-hourweeks, When hestartedin2010,hispaywas$550a SMALL BUSINESS | DRY CLEANING P021-22cl_CN_20160509.qxp 5/6/2016 3:04 PM Page 21

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1RWLFHRI4XDOLÀFDWLRQRI%5,'*(721 1RWLFHRI4XDOLÀFDWLRQRI+RSH 1RWLFHRI4XDOLÀFDWLRQRI$'$0$ '(9(/230(17//&$SSOIRU$XWK )UDJUDQFHV//&$XWKRULW\ÀOHGZLWK 3$571(56//&$SSOIRU$XWKÀOHG COMMUNICATION ÀOHGZLWK6HF\RI6WDWHRI1< 661< 1<'HSWRI6WDWHRQ2IÀFH ZLWK6HF\RI6WDWHRI1< 661< GODDESS RQ2IÀFHORFDWLRQ1< ORFDWLRQ1<&RXQW\//&IRUPHGLQ'( RQ2IÀFHORFDWLRQ1< The Last Word LLC &RXQW\//&IRUPHGLQ'HODZDUH '( RQ1<6HFRI6WDWHGHVLJ- &RXQW\//&IRUPHGLQ'HODZDUH '( Speaking, Writing, RQ3ULQFRIÀFHRI//& QDWHGDJHQWRI//&XSRQZKRPSURFHVV RQ3ULQFRIÀFHRI//& Consulting & Production %ULGJHWRQ+ROGLQJV//&)LIWK DJDLQVWLWPD\EHVHUYHGDQGVKDOO (QG6W6WH1<1< 646.434.6738 z 734.237.6614 $YHWK)O1<1<661< PDLOSURFHVVWRWKHSULQFLSDOEXVLQHVV 1<6ÀFWLWLRXVQDPH$'$0$3$571(56 lastword.com Carol Dunitz, Ph.D. GHVLJQDWHGDVDJHQWRI//&XSRQZKRP DGGUHVV:WK6W6WH ,//&661[email protected] any lawful activity. Notice of Formation of BRP Caton Flats 15 years in business Notice of Formation of EDIT LDO, LLC LLC. Arts. of Org. filed with NY Dept. of 132 West 31st Street, 15th Floor (LLC). Art. of Org. filed with Secretary State on 8/31/15. Office location: NY NYC, NY 10001 of State of New York (SSNY) on Notice of Formation of 204 Forsyth County. Princ. bus. addr.: 767 3rd Ave., 05/06/15. Office location: NY County. Lender LLC. Arts. of Org. filed with NY 33rd Fl., NY, NY 10017. Sec. of State SSNY designated as agent of LLC upon Dept. of State on 4/5/16. Office location: designated agent of LLC upon whom TELECOMMUNICATIONS whom process against it may be NY County. Sec. of State designated process against it may be served and served. SSNY shall mail a copy of the agent of LLC upon whom process against shall mail process to: CT Corporation process to: Rosemarie Tully, PC, POB it may be served and shall mail process System, 111 8th Ave., NY, NY 10011, 1054, Huntington, NY 11743. Term: to: c/o Churchill Credit Holdings LLC, regd. agent upon whom process may Perpetual. Purpose: Any lawful purpose. 250 Bowery, 2nd Fl., NY, NY 10012, be served. Purpose: all lawful purposes. principal business address. Purpose: all 33 East 33rd Street lawful purposes. New York, NY 10016 Wolman Family Partners, LLC filed an 1RWLFHRI4XDOLÀFDWLRQRI$572)285 212-532-7400 App. for Authority with the NY Dept. of Notice of Qualification of UIG, LLC. Appl. 7,0(/3$SSOIRU$XWKÀOHGZLWK6HF\ [email protected] State on 4/11/2016. Jurisdiction: DE for Auth. filed with Secy. of State of NY RI6WDWHRI1< 661< RQ EMERGENCY and it was organized on 12/31/2015. (SSNY) on 04/08/16. Office location: NY 2IÀFHORFDWLRQ1<&RXQW\/3IRUPHG Office located in NY county. The Sec’ty of LQ'HODZDUH '( RQ3ULQF COMMUNICATIONS County. LLC formed in Delaware (DE) on SYSTEMS the State of NY (“SSNY”) is designated 03/21/16. NYS fictitious name: URBAN RIÀFHRI/3(UG6W)O1< as agent upon whom process against it INNOVATION GROUP, LLC. SSNY 1<661

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Notice of Qualification of Children’s Notice of Qualification of WALKER & Notice of Qualification of Aptevo BioThera- Notice of Qualification of Nelson Tree- Creative Learning Centers LLC. Authority DUNLOP COMMERCIAL PROPERTY peutics LLC. Authority filed with NY Dept. house and Supply, LLC. Authority filed filed with NY Dept. of State on 1/29/16. FUNDING I CB, LLC. Appl. for Auth. filed of State on 4/12/16. Office location: NY with NY Dept. of State on 4/7/16. Office Office location: NY County. LLC formed with Secy. of State of NY (SSNY) on County. Princ. bus. addr.: 920 Cassatt location: NY County. LLC formed in WA in CA on 8/12/15. NY Sec. of State 04/08/16. Office location: NY County. Rd., Ste. 100, Berwyn, PA 19312. LLC on 9/12/11. NY Sec. of State designated designated agent of LLC upon whom LLC formed in Delaware (DE) on formed in DE on 1/15/16. NY Sec. of agent of LLC upon whom process against process against it may be served and 04/04/16. Princ. office of LLC: 535 State designated agent of LLC upon it may be served and shall mail process shall mail process to: c/o CT Corporation Madison Ave., 12th Fl., NY, NY 10022. whom process against it may be served to: c/o CT Corporation System, 111 8th System, 111 8th Ave., NY, NY 10011, SSNY designated as agent of LLC upon and shall mail process to: c/o CT Cor- Ave., NY, NY 10011, regd. agent upon regd. agent upon whom process may be whom process against it may be served. poration System, 111 8th Ave., NY, NY whom process may be served. WA and served. Principal office address: 650 NE SSNY shall mail process to c/o Corpora- 10011, regd. agent upon whom process principal business address: 32925 Holladay St., Ste. 1400, Portland, OR tion Service Co. (CSC), 80 State St., may be served. DE addr. of LLC: 1209 SE Issaquah Fall City Rd., Fall City, WA 97232. Cert. of Form. filed with CA Sec. Albany, NY 12207-2543. DE addr. of Orange St., Wilmington, DE 19801. Cert. 98024. Cert. of Form. filed with WA Sec. of State, 1500 11th St., Sacramento, LLC: CSC, 2711 Centerville Rd., Ste. of Form. filed with DE Sec. of State, 401 of State, 801 Capitol Way S., Olympia, CA 95814. Purpose: all lawful purposes 400, Wilmington, DE 19808. Cert. of Federal St., Dover, DE 19901. Purpose: WA 98501. Purpose: all lawful purposes. Form. filed with Secy. of State, 401 all lawful purposes. Federal St., Ste. 4, Dover, DE 19901. Notice of Formation of Caton Market Notice of Formation of Grand Wac LLC. Arts. Purpose: Any lawful activity. Operator LLC. Arts. of Org. filed with of Org. filed with Secy. of State of NY (SSNY) 21-78 19TH STREET LLC. Art. of Org. filed with the SSNY on 04/12/16. NY Dept. of State on 9/24/15. Office on 4/27/16. Office location: NY County. Notice of Qualification of AGNL Extrusion, location: NY County. Princ. bus. addr.: SSNY designated as agent of LLC upon Office: New York County. SSNY desig- L.L.C. Authority filed with NY Dept. of nated as agent of the LLC upon whom 767 3rd Ave., 33rd Fl., NY, NY 10017. whom process against it may be served. State on 4/12/16. Office location: NY Sec. of State designated agent of LLC SSNY shall mail process to: c/o The LLC, process against it may be served. SSNY County. LLC formed in DE on 4/8/16. NY shall mail copy of process to the LLC, upon whom process against it may be 192 Lexington Avenue, Ste. 1100, NY, Sec. of State designated agent of LLC served and shall mail process to: CT NY 10016. Purpose: any lawful activity. c/o Triena Capital Partners LLC, 447 upon whom process against it may be West 18th Street, 4A, New York, NY Corporation System, 111 8th Ave., NY, served and shall mail process to: 245 10011. Purpose: Any lawful purpose. NY 10011, regd. agent upon whom Notice of Formation of Blue Note USA, Park Ave., 24th Fl., NY, NY 10167, princi- process may be served. Purpose: all LLC. Arts. of Org. filed with NY Dept. of pal business address. DE address of LLC: lawful purposes. State on 4/4/16. Office location: NY 850 New Burton Rd., Ste. 201, Dover, Notice of Formation of VENDO FORTIS, County. Sec. of State designated agent DE 19904. Cert. of Form. filed with DE LLC (LLC). Art. of Org. filed with Notice of Formation of CMA of LLC upon whom process against it Sec. of State, 401 Federal St., Dover, DE Secretary of State of New York (SSNY) INTERNATIONAL CONSULTANCY, LLC. may be served and shall mail process to: 19901. Purpose: any lawful activity. on 01/21/16. Office location: NY Arts. of Org. filed with Secy. of State of Steven Bensusan, 131 W. 3rd St., NY, County. SSNY designated as agent of NY (SSNY) on 03/31/16. Office location: NY 10013, principal business address. LLC upon whom process against it may NY County. SSNY designated as agent Purpose: all lawful purposes. O. Hannah Films LLC Articles of Org. be served. SSNY shall mail a copy of filed NY Sec. of State (SSNY) the process to: Vendo Fortis, LLC, POB of LLC upon whom process against it 1/14/2016. Office in NY Co. SSNY may be served. SSNY shall mail process Notice of Formation of Bratland Indus- 2015, NY, NY 10159. Term: Perpetual. desig. agent of LLC upon whom process to the LLC, 1251 Ave. of the Americas, tries LLC. Arts of Org filed with secy. of Purpose: Any lawful purpose. may be served. SSNY shall mail copy of 27th Fl., NY, NY 10020-1104. Purpose: state of NY (SSNY) on 3/3/16. Office process to 129 W. 22nd St., #9, NY, NY Any lawful activity. location: NY county SSNY designated 10011, which is also the principal NOTICE OF FORMATION OF Pinnacle agent upon whom process may be business location. Purpose: Any lawful Standard, LLC. Articles of Organization Notification of Qualification of Grossman served and shall mail copy of process purpose. filed with the Secretary of State of NY Cedar Lane/36th Street, LLC. Authority against LLC to principle business (SSNY) on 03/14/2016. Office location: filed with Secy. of State of NY (SSNY) on address: 248 E 2nd Street Apt #11 NY, NEW YORK County. SSNY has been 3/17/2016. Office location: NY County. NY 10009. Purpose: any lawful act. Notice of Formation of NORTE UNITED, designated as agent upon whom process LLC formed in NV on 1/9/2012. SSNY LLC. Arts. of Org. filed with Secy. of State against it may be served. The Post Office designated agent upon whom process of NY (SSNY) on 04/15/16. Office loca- Name of LLC: IWMNY LLC. Arts. of Org. address to which the SSNY shall mail may be served and shall mail copy of tion: NY County. SSNY designated as filed with NY Dept. of State: 3/28/16. a copy of any process against the LLC process against LLC to: Janie Manage- agent of LLC upon whom process against Office location: NY Co. Sec. of State served upon him/her is: 3105 Decatur ment Corp., 335 Oak Avenue, River it may be served. SSNY shall mail process designated agent of LLC upon whom Ave, Apt 52A, Bronx, NY 10467. The Edge, NJ 07661. Principal business to Corporation Service Co., 80 State St., process against it may be served and principal business address of the LLC address: 1655 Blue Spruce Road, Reno, Albany, NY 12207, regd. agent upon shall mail process to: Danow McMullan is: PO Box 68, New York, NY 10009. NV 89511. Certificate of LLC filed with whom and at which process may be & Panoff PC, 275 Madison Ave., Ste. Purpose: any lawful act or activity. Secy. of State of NV located at: 101 served. Purpose: Any lawful activity. 1711, NY, NY 10016. Purpose: any North Carson Street, Suite 3, Carson lawful act. Notice of Qualification of WALKER & City, NY 89701. Purpose: any lawful act. Notice of Qualification of VILLAGE DUNLOP COMMERCIAL PROPERTY GREENWICH LLC. Appl. for Auth. filed FUNDING II CB, LLC. Appl. for Auth. filed Notice of Qualification of Crossbridge with Secy. of State of NY (SSNY) on with Secy. of State of NY (SSNY) on Notice of Qualification of Cotiviti, LLC. Consulting, LLC. Authority filed with NY 04/11/16. Office location: NY County. 04/08/16. Office location: NY County. Authority filed with NY Dept. of State on Dept. of State on 1/20/16. Office location: LLC formed in Delaware (DE) on LLC formed in Delaware (DE) on 4/13/2016. Office location: NY County. NY County. LLC formed in DE on 1/12/16. 02/12/16. Princ. office of LLC: c/o 04/04/16. Princ. office of LLC: 535 Princ. bus. addr.: 50 Danbury Rd., NY Sec. of State designated agent of Grant, Herrmann, Schwartz & Klinger Madison Ave., 12th Fl., NY, NY 10022. Wilton, CT 06897. LLC formed in DE on LLC upon whom process against it may LLP, 675 Third Ave., Fl. 26, NY, NY SSNY designated as agent of LLC upon 9/4/1996. NY Sec. of State designated be served and shall mail process to: 10017.SSNY designated as agent of whom process against it may be served. agent of LLC upon whom process against Stephen Shyn, 1180 Ave. of the Americas, LLC upon whom process against it may SSNY shall mail process to c/o Corpora- it may be served and shall mail process Suite 805, NY, NY 10036, principal be served. SSNY shall mail process to tion Service Co. (CSC), 80 State St., to: c/o CT Corporation System, 111 8th business address. DE address of LLC: the LLC at the addr. of its princ. office. Albany, NY 12207-2543. DE addr. of Ave., NY, NY 10011, regd. agent upon c/o The Corporation Trust Co., 1209 DE addr. of LLC: 2711 Centerville Rd., LLC: CSC, 2711 Centerville Rd., Ste. whom process may be served. DE addr. Orange St., Wilmington, DE 19801. Ste. 400, Wilmington, DE 19808. Cert. 400, Wilmington, DE 19808. Cert. of of LLC: 1209 Orange St., Wilmington, DE Cert. of Form. filed with DE Sec. of of Form. filed with Jeffrey W. Bullock, Form. filed with Secy. of State, 401 19801. Cert. of Form. filed with DE Sec. State, 401 Federal St., Dover, DE 401 Federal St., #4, Dover, DE 19901. Federal St., Ste. 4, Dover, DE 19901. of State, 401 Federal St., Dover, DE 19901. Purpose: all lawful purposes. Purpose: Any lawful activity. Purpose: Any lawful activity. 19901. Purpose: all lawful purposes.

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22 | CRAIN’S NEW YORK BUSINESS | MAY 9, 2016 To place your listing, contact Joanne Barbieri • 212-210-0189

FINANCE REAL ESTATE Harbor Group International TECHNOLOGY BankUnited Charles Rutenberg Matt Jones, 37, was Shufflrr Michael Tartanella, 51, Alan Pfeifer, 74, promoted to Director Linda McGuigan was appointed Board joined BankUnited as joined Charles of Acquisitions. Rutenberg, LLC as Advisor . She con- Senior Vice Presi- Formerly a Managing Associate Broker. tinues as VP Global Director with the dent, environmental He was formerly Sales at Moves the risk manager. He was Associate Broker at firm overseeing all Needle. Linda will provide strategic formerly environ- Douglas Elliman. multifamily invest- counsel to help make Shufflrr a Pfeifer specializes in ments, Mr. Jones’ role will expand mental risk manager staple within all enterprise sales and residential and commercial condos, at Capitol One, NA. At BankUnited, to leading and executing the firm’s marketing teams. coops and town houses in sales and his chief responsibilities will include investment strategy across all rentals. Additionally, he teaches at product types and markets. Since overseeing the maintenance and the Academy for Continuing Edu- CA Technologies application of the bank’s envi- cation and is a certified instructor joining HGI in 2002, Mr. Jones has Darlàn Monterisi, 37, ronmental policy as it relates to at REBNY. He is also a member of sourced and closed $2.6 billion in joined CA Tech- nologies as Senior providing risk and liability analysis; the Institute for Global Ethics and multifamily investment opportuni- participates in its seminars. As one Vice President of conducting environmental training ties, with HGI acquiring or provid- of the founding members, Alan Corporate Commu- ing capital to transactions totaling and education throughout the lend- helped to pioneer a high-level nications. She was formerly Partner and ing lines and credit administration; Advanced Post Graduate Desig- more than 34,000 multifamily units. Managing Director at Porter Novelli. monitoring the bank’s compli- nation Real Estate Course known Additionally, he has helped lead the Monterisi is responsible for oversee- growth of HGI’s preferred equity ance with local, state and federal as New York Residential Specialist ing the company’s global corporate regulations; and ensuring that the (NYRS), known to attract associate and mezzanine lending platform and communications function and brokers who desire to raise the bar bank’s policy and procedures are in was also instrumental in developing stewarding a highly integrated ap- in professionalism and ethics in New proach to delivering the company’s compliance with external federal HGI’s investment activity in Freddie York City. Alan holds the position of corporate and product messages to Mac loan securitizations. audit practices Chairman Emeritus. key audiences. EXECUTIVE MOVES Try our new Advanced Search tool with data on thousands of executives and personnel changes. www.crainsnewyork.com/execmoves

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GOTHAM GIGS

ROAD WARRIOR: Castaldi found his legal work more satisfying when he got back on his bike after a 20-year hiatus.

These wheels of justice grind rather quickly Personal-injury lawyer pedals his services to bicycle messengers,racers and recreationists PHILIP CASTALDI orget business cards. At cycling events, Philip with a couple hundred bike-riding clients a year. Castaldi hands out water bottles imprinted He has sued manufacturers for dysfunctional bike AGE: 51 with his name and number. With a law prac- parts, and defended bike shops against cyclists claim- tice built around bicycle accidents, the bot- ing injuries from seat posts. He’s gone after commer- BORN: Queens Ftles have turned him into a rainmaker. cial drivers and their employers. Suing the city for EDUCATION: J.D., St. John’s Castaldi literally fell into his occupation. He was a pothole-caused wrecks is “very difficult,” he said. University high school senior riding in Prospect Park A dozen years ago, a brother who raced STARTING LINE: There were no when he collided head-on with a police car Nailing an in the city asked Castaldi to sponsor his sports teams at Edward R. Murrow going the wrong way in the bike lane. He “ cycling team. Castaldi printed his firm’s High School in Midwood, Brooklyn. “I insurance had to find something to do,” Castaldi flew over its hood, smashing the lights on name on the jerseys, and soon was backing said. “So I picked up cycling.” He its roof. His cycling buddies figured he was company for races in Prospect Park and at the Kissena would train in Prospect Park, with his dead, but only the bike was damaged. a $12,000 Velodrome in Queens, cyclo-cross compe- brothers and friends. His parents hired a lawyer. “All I cared bike—there’s titions on Staten Island and a summer series ALMOST COMPETITIVE: Castaldi about was getting my bike fixed,” said in Floyd Bennett Park. Castaldi has a pho- raced all through law school. He quit Castaldi, who had saved up $800 to buy satisfaction” tographer shoot races and posts images on biking for 20 years, but a brother it. “And the lawyer didn’t care about my the firm’s website. He has thrown parties lured him back into racing several years ago. “You’ll see some guy at bike at all. The guy got me nothing for the bike.” for bike messengers and ridden beside organizers of the the back, and that’ll be me,” he said. Today, Castaldi works mostly with New York City’s nonprofit advocacy group Transportation Alternatives. SAFETY LESSONS: He advises bike commuters, messengers and racers. Closest to his All the cycling has made him a go-to lawyer for bik- cyclists to ride with daytime flashing heart are cases in which insurers offer bubkes for a man- ers. “The whole business comes down to networking,” lights and to be excruciatingly careful gled carbon-fiber masterpiece. “Nailing an insurance he said. For him, that means pedaling. “I didn’t like my making left turns. His law firm hands company for a $12,000 bike when they offered the guy job so much when I was just doing personal injury,” out thick plastic cards that advise $300 … there’s some real personal satisfaction,” he said. he said, “but the mix with biking—it’s fun. I go out, I cyclists on what to do after an accident—from getting a police-report “Pedestrians and bicyclists are exposed,” said ride anywhere around the city and I’m waving to peo- accident number to phoning his firm.

BUCK ENNIS Castaldi, whose firm, Lucarelli & Castaldi, works ple who are like, ‘Phil! Phil!’” — CARA EISENPRESS

24 | CRAIN’S NEW YORK BUSINESS | MAY 9, 2016 20160509-NEWS--0025-NAT-CCI-CN_-- 5/6/2016 6:25 PM Page 1

SNAPS

$1.5 million raised for children The Northside Center for Child Development celebrated its 70th anniversary at a gala at Cipriani 42nd Street on April 27 that raised more than $1.5 million. The fete, which attracted 500 guests, included a special performance by jazz legend Wynton Marsalis that was dedicated to one of the honorees, Kenneth Chenault, the chair and CEO of American Express. The center was founded to provide mental health and educa- tional services to African-American and Latino children. The nonprofit operates two centers in Harlem and one each in the Bronx and Brooklyn.

Ted Wells, a partner and co-chair of the litigation department at Paul Weiss Kenneth Chenault, CEO and chair- Rifkind Wharton & man of American Express, and his Garrison, and his wife, wife, Kathryn, at the benefit for the Nina, at the Northside Northside Center. fundraiser.

New Yorkers show they’re for parks

Donations boost NY-Presbyterian

Iris Cantor, president and chair of the Iris & B. Gerald Cantor Foundation, with Dr. Steven Corwin, president and CEO of New York-Presbyterian Hospital, at a benefit for the institution that raised $4.7 million. Anthony Antonucci, co-founder and chair of H.E.A.L.T.H. for Youths, Heather Butts, co-founder and executive director of H.E.A.L.T.H. for Youths, and Lynden B. Miller, a public-garden designer and a New Yorkers for Parks board member, at a fundraising breakfast on April 20 for New Yorkers for Parks, a nonprofit that builds and protects parks in the city.

Fern Tessler and her husband, Lenard Tessler, a managing director at Cerberus Capital Management, at the New York- Presbyterian fundraiser on April 14 at the Waldorf Astoria.

Alyson Beha, senior regional planner, HUD New York and New Jersey, Jennifer Hoppa, Northern Manhattan Parks administrator, Holly M. Leicht, regional administrator, HUD New York and New Jersey, and James Yolles, a vice president at Risa Heller Communications, at the New Yorkers for Parks fundraiser at the Bryant Park Grill that raised $100,000.

CHRISTOPHER GILLCHRISTOPHER SR.,WALSH, & IMAGING, SOLUTIONS KARLI CADEL CREATIVE 4EYESPHOTOGRAPHY/KELLIE SEE MORE OF THIS WEEK’S SNAPS ONLINE AT CRAINSNEWYORK.COM/SNAPS GET YOUR GALA IN SNAPS. EMAIL THERESA AGOVINO, [email protected]

MAY 9, 2016 | CRAIN’S NEW YORK BUSINESS | 25 20160509-NEWS--0026-NAT-CCI-CN_-- 5/6/2016 6:25 PM Page 1

FOR THE RECORD*

Jack’s Stir Brew represented by Suzuki represented by Lee & Yves Delorme signed a NEW IN TOWN 2 Sixth Ave. MERGERS AND Capital. The asking rent Associates NYC. The ask- 10-year lease for 1,020 The organic, fair-trade ACQUISITIONS was $130 per square foot. ing rent was in the mid- square feet at 1070 AUrate coffee shop opened its $80s per square foot. Madison Ave. on the 92 W. Houston St. sixth Manhattan location, Dimension Data has RETAIL Upper East Side. The The fine-jewelry brand in TriBeCa. Cold-pressed acquired Ceryx, a Paulie Gee’s signed a 10- Vivi Bubble Tea signed a Parisian towel and bed- opened its first brick-and- juices and vegan sweets Toronto-based communi- year lease for 1,900 square 10-year lease at 111-115 ding company will occupy mortar store in SoHo. A are also available. cations provider. Ceryx feet at 110 Franklin St. in Court St. in Brooklyn 800 square feet on the by-appointment show- will become part of TriBeCa. The pizza shop Heights. The Taiwanese ground floor and 220 feet room is open to the public. Le Pain Quotidien Dimension Data’s IT-as-a- will occupy 1,400 square bubble-tea chain will in the basement of the West 72nd Street and service unit and will offer feet on the ground floor occupy 1,000 square feet property at East 81st The Chinese Club Broadway on-premises private and and 500 square feet in the in the building between Street. The tenant was 208 Grand St., Brooklyn The French bakery opened public cloud services to its basement of the building State and Schermerhorn represented by Lansco. An homage to the social a kiosk with outdoor café Fortune 500 clients within at the corner of Noble streets. The tenant and the The landlord, Fernback, club opened by a co- seating on the Upper West Canada and the U.S. Street. The tenant was landlord were represented was represented by owner’s grandfather in Side, in Verdi Square. The represented by In-Haus. by Kassin Sabbagh Realty. Tri-Star Equities. The Kolkata, India, where menu offers breakfast, The landlord, Franklin The asking rent was $200 asking rent was $550 per many Chinese immigrants lunch and pastry options REAL ESTATE DEALS Avenue Developers, was per square foot. square foot. have settled, this to eat there or take away. Williamsburg restaurant COMMERCIAL serves Chinese-Indian The Pavilion Mic signed a 10-year DEALS ROUNDUP fusion dishes such as 20 Union Square West lease for 36,000 square vegetable fritters in brown The seasonal, open-air feet at 1 World Trade TARGET/SELLERS TRANSACTION BUYERS/INVESTORS TRANSACTION TYPE sauce. restaurant returned to Center. The online media SIZE [IN MILLIONS] Union Square. company was represented DreamWorks Animation SKG, $4,370.2 NBCUniversal Media SB M&A Créme & Sugar by Transwestern. The Inc./Horizon Kinetics (Manhattan) (Manhattan); Infosys Ltd., 1198 First Ave., Queens Wild West Brooklyn landlord, the Durst investment arm; T. Rowe Price This Peruvian dessert shop 439 Metropolitan Ave., Organization, was repre- Associates Inc. opened in Ridgewood. Brooklyn sented by Cushman & Offerings include rain- The owners of Brooklyn- Wakefield. The asking rent MPLX $1,000.0 Kayne Anderson Capital Advisors; GCI bow-colored bagels and based lingerie brand Daisy was between $80 to $100 Magnetar Capital; Stonepeak Infrastructure Partners (Manhattan); Peruvian ice cream, & Elizabeth opened a pop- per square foot. Energy & Minerals Group including flavors like up clothing store in lucuma and cherimoya. Williamsburg that sells BTG Pactual signed an Verisk Health Inc. and $820.0 Veritas Capital (Manhattan) FB M&A vintage-inspired 11-year renewal lease for MediConnect Global Inc./ Argus Information & Advisory Domenico Vacca Americana and Western 31,401 square feet at 601 Services 15 W. 55th St. accessories. The shop will Lexington Ave. The invest- The Italian luxury label close on May 16. ment bank will continue Indigo Minerals $375.0 Martin Cos.; Ridgemont Equity GCI consolidated all of its New to rent the 57th floor in Partners; Trilantic Capital Management (Manhattan); York City locations into a the 59-story tower Yorktown Partners (Manhattan) superstore in midtown BANKRUPTCIES between East 53rd and east. The flagship boasts a East 54th streets. The ten- Hua Medicine Ltd. $50.0 Ally Bridge Group; Arch Venture GCI café, a women’s hair salon Kevin & Richard ant was represented by (Shanghai) Partners; Eight Roads Ventures China; F-Prime Capital Partners; and a men’s barbershop. Plumbing & Heating Newmark Grubb Knight Frontline BioVentures; Harvest Fund Membership to an on-site Supplies Corp. Frank. The landlord, Management Co.; SAIL Capital private social club, which 525 Park Ave., Brooklyn Boston Properties, repre- Partners; TF Capital; Venrock (Manhattan); Wuxi Healthcare Ventures provides access to an art Filed for Chapter 11 bank- sented itself. The asking gallery and short-term- ruptcy on April 15. The rent was undisclosed. Kamcord Inc. $10.0 Plug and Play Tech Center; Tencent GCI stay apartments, is $1,800 filing cites estimated lia- Holdings, investment arm; Time Warner a month. bilities and assets of $0 to Sixty Hotels signed a Investments (Manhattan); TransLink Capital; Wargaming.net; XG Ventures $50,000. The list of credi- five-year lease for 2,500 Moemen King 206 Spring tors includes 4th Avenue square feet at SparkCognition Inc. $6.0 Alameda Ventures; CME Ventures; GCI 201 Allen St. Burner & H Supplies Inc., St. in SoHo. The hotel Entrepreneurs’ Fund; Verizon The Mediterranean restau- AF Supply and Alro management company Ventures (Manhattan) rant opened on the Lower Products. will occupy the entire East Side. The menu fourth floor of the five- IMMUN.IO Inc. $5.0 Bloomberg Beta; Hoxton GCI Ventures; Real Ventures; includes staples like hum- Obigor story property between White Star Capital mus platters, shawarma 160-29 Union Turnpike, Sixth Avenue and Sullivan and falafel sandwiches. Queens Street. The tenant was Poncho Inc. $2.0 Advancit Capital; Betaworks Studio, GCI Filed for Chapter 7 bank- represented by BSD Realty investment arm (Manhattan); Broadway Video Ventures; Comcast Starbucks Coffee ruptcy on April 14. The Worldwide. The landlord, Ventures; Greycroft Partners 61 Ninth Ave. filing cites estimated lia- Corgin Real Estate Group, (Manhattan); individual investors; The Seattle coffee giant bilities and assets of was represented by Lerer Hippeau Ventures (Manhattan); NextNews; RRE Ventures (Manhattan); will open its first New $1,000,001 to $10 million. Eastern Consolidated. The Venture51 Capital Fund York City roastery, in the asking rent was $75 per meatpacking district. Sutton 58 square foot. Selected deals announced for the week ended April 28 involving companies in metro New York. SB M&A: 428-432 E. 58th St. Strategic buyer M&A represents a minority or majority acquisition of existing shares of a company without Construction is expected the participation of a financial buyer. FB M&A: Financial buyer M&A represents a minority or majority to be finished by the end Filed for Chapter 11 bank- Viva Events and Catering acquisition of existing shares of a company with the participation of a financial buyer. GCI: Growth capital of 2017. ruptcy on April 6. The signed a 10-year lease for investment represents new money invested in a company for a minority stake. SOURCE: CAPITALIQ filing cites estimated lia- 2,000 square feet at 222 E. bilities and assets of 58th St. in midtown east. COMPANY MOVES $100,000,001 to $500 mil- The wedding and event lion. The creditors with planning company will GET YOUR NEWS ON THE RECORD Cardiff Giant the largest unsecured occupy the lower level in *To submit company openings, moves or real estate deals, or to receive further information, 415 Myrtle Ave., Brooklyn claims are Gemini the building between email [email protected]. The team behind Brooklyn Residential, owed Second and Third avenues. For the Record is a weekly listing to help businesspeople in New York find opportunities, bars Glorietta Baldy and $12,084,000; Jones Lang The tenant was represent- potential new clients and updates on customers. Bankruptcy filings from the Eastern and Mission Dolores opened LaSalle, owed $1,892,250; ed by Nest Seekers Southern districts of New York are listed alphabetically, as are recently announced New York another location in Clinton and FP Architects, owed International. The land- City agency contract opportunities. Real estate listings are provided in order of square footage. Hill. $968,954. lord, SSJL Holdings, was

26 | CRAIN’S NEW YORK BUSINESS | MAY 9, 2016 20160509-NEWS--0027-NAT-CCI-CN_-- 5/6/2016 7:18 PM Page 1

PHOTO FINISH

Hotel hookups

he outside of 325 Hudson St. looks like an ordinary office building. TInside, though, it holds the guts that help bring the internet to New Yorkers. The building is what the tech industry calls a “carrier hotel.” It’s owned by Netrality, a company that connects major content providers including Google, Facebook and Netflix to smaller internet service providers including RCN, EarthLink and, most recently, Rainbow Broadband. At the carrier hotel’s heart is the “meet-me room,” shown here. It’s a nerve center of fiber-optic cables and switches that saves streaming services the hassle of running cables directly to each service provider. “It’s like an airport,” said Netrality founder Hunter Newby, where service providers are the airlines and frequent fliers are the Hulus and HBOs of the internet that are hoping to send their content from point A to point B. “Would it make any sense for Delta to have its own airport and JetBlue to have its own airport?” Newby said. — PETER D’AMATO PETER D’AMATO

MAY 9, 2016 | CRAIN’S NEW YORK BUSINESS | 27 B:11.125” T:10.875” S:10.25”

Going big for small business. B:14.75” T:14.5” S:14”

Via prepaid rebate card w/ mobile internet line

RUSSELL GRIMM BROTHERS BREWHOUSE LOVELAND, CO T-MOBILE CUSTOMER

Grimm Brothers Brewhouse and millions of other small businesses use T-Mobile @Work for wireless with straightforward pricing and no overages, ever. You also get a 24/7 dedicated business account team that knows you and your company. Plus, we doubled our 4G LTE coverage in the last year to cover 308 million people, so you can get more done in more places.

See an @Work specialist at a T-Mobile store today. T-Mobile.com/AtWork

Limited time offers; subject to change. Part’g locations. Credit approval, deposit & $20 SIM starter kits may be req’d. Monthly Regulatory Programs (RPF) & Telco Recovery Fee (TRF) totaling $2.71 per voice line ($0.60 for RPF & $2.11 for TRF) and $0.98 per data only line ($0.15 for RPF & $0.83 for TRF) applies. Taxes approx. 6–28% of bill. Certain uses, e.g., some speed test apps, may not count against high-speed data allotment or have speeds reduced after allotment reached. U.S. roaming and on-network data allotments differ; includes 200 MB roaming. No overages for domestic postpaid, non-pooled use; pay-per-use charges may apply on some services (e.g., Pooled). Free Hotspot: Get 2 @Work Voice lines and 1 Mobile Internet line and get a ZTE Falcon Z-917 hotspot. Lines must be on same account; 1 offer per account. If you cancel wireless service, remaining balance on device may become due and rebate may be billed to your account if you cancel before 8/1/16. Allow 8 weeks. Card issued by Citibank, N.A. pursuant to a license from MasterCard International and managed by Citi Prepaid Services. Card expires. Coverage not available in some areas. Network Management: Service may be restricted for abnormal use or interference with our ability to provide quality service to other users, or signiﬁ cant roaming. Customers who use an extremely high amount of data in a bill cycle will have their data usage de-prioritized compared to other customers for that bill cycle at locations and times when competing network demands occur, resulting in relatively slower speeds. See T-Mobile.com/OpenInternet for details. See Terms and Conditions (including arbitration provision) at www.T-Mobile.com for additional information. T-Mobile and the magenta color are registered trademarks of Deutsche Telekom AG. ©2016 T-Mobile USA, Inc.

General Information Production Specs PrePress Info Name OK FIX Date File name: 16717_ELWorkBusJrnlsMay_05.02.16.indd Bleed: 11.125” x 14.75” Application: InDesign CC 2015 11.3 D.A.: Chris Gallegos

Client: T-Mobile Trim: 10.875” x 14.5” Colors: Cyan, Magenta, Q.C.: Ricky Fischer Yellow, Black Job #: 16-TMO-102-P-01 Live: 10.25” x 14” Fonts: Tele Proofreader: Jenny Keene Media Type: None Gutter: None Project Mgr: Tony King

Release Date: None Common Size: None A.D.: None

Date/Time: 4-28-2016 9:17 AM Ad Size: None Copywriter: None

Creative Version: @ WORK BUSINESS JOURNALS - MAY Output %: None C.D.: None Comments: x1a pdf Print Pro.: Molly Costin AD SNAP 2009 220% max ink density NEW YORK CRAINS Acct. Exec.: None 16717 Acct. Super.: None

MAY - 5/2/16 Client OK: 10.25” x 14.5”