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INSIDE 40 UNDER TOP STORIES FORTY It’s time to rein in NOMINATIONS the horse carriage Closing Dec. 2! neigh-sayers www.crainsnewyork.com/ ® 40under40 MICHAEL GROSS PAGE 2

VOL. XXVII, NO. 48 WWW.CRAINSNEWYORK.COM NOV. 28-DEC. 4, 2011 PRICE: $3.00

Two fashion greats, THE RISE AND STALL OF Inside Ira two business fates PAGE 2 Rennert’s Arg! Digital pirates dirtiest target the e-book FOODTRUCKS PAGE 3 business The wheel deal: Cyclery openings Epic pollution mess switch to high gear in Peru puts reclusive PAGE 7 mogul and his biz B’klyn’s Myrtle Ave. practices in spotlight transformed from dicey to delightful BY AARON ELSTEIN NEIGHBORHOODS PAGE 9 In 2004, a public health expert in Mis- souri named Fernando Serrano got a call from an archbishop in Peru. High BUSINESS LIVES up in the Andes, a metals refinery was spewing pollution that coated the fac- tory town of La Oroya. The archbish- op wanted Mr. Serrano to assess the damage. Mr. Serrano, a professor at Jesuit institution Saint Louis University, flew to the Peruvian capital of Lima and took the long, winding road five hours east and 12,000 feet up to the town whose soil had turned too acidic for plants to grow. He tested La Oroya’s ground,air and water,and took GOTHAM GIGS blood samples from some of its 35,000 A “Ninja” master—in residents. The results took his breath customer service P. 29 away: The town was not only laden ● ANNE FISHER How to with arsenic, antimony and , market your brand P. 29 but an estimated 97% of the children BY LISA FICKENSCHER between ages six and 12 had elevated ● MOVERS & SHAKERS levels of lead in their blood—levels Chris Burch checks out See on Page 27 a new retail concept for The Urban Oasis Traveling Organic Café the holidays P. 30 called it quits earlier this year.The owners, George and Elaine Karaisarides, are selling ● GAEL GREENE Over the moon about Kibo P. 31 their “completely renovated” vehicle on Craigslist for $55,000. It was straining their relationship, the couple wrote on their blog, and a city clampdown on food trucks INDEX only compounded their pressures. “There are plenty of people who are se- IN THE MARKETS ______4 riously questioning the viability of this THE INSIDER ______8 business,” said David Weber, president of VIEWPOINT ______10 the 10-month-old Food OPINION ______11 NOT SO SWEET: Treats Truck Truck Association and co-owner of Rick- SMALL BUSINESS ______13 owner Kim Ima says tougher FOR THE RECORD shaw Dumpling Bar, which owns four ______14 new city rules make good trucks and two restaurants. CLASSIFIEDS parking spaces harder to find. trucks and two restaurants. ______22 The Karaisarides’ experience is just one EXECUTIVE MOVES ______29 See FOOD TRUCKS on Page 28 gettyimages THE WEEK AHEAD ______31 THE NEXT DOOR: Ira Rennert’s

buck ennis overseas troubles may be coming home to roost. REPORT REAL ESTATE STARCHITECTS Name-brand residential towers outperform the market P. 15 ELECTRONIC EDITION HOT PROPERTIES Why office condos are so popular with foreign buyers P. 15 CRAIN’S LIST New York City’s Top Commercial Property Managers P. 20 NEWSPAPER 20111128-NEWS--0002,0003-NAT-CCI-CN_-- 11/23/2011 6:22 PM Page 1

COMMENTARY Designer greats, Let’s talk Liz label sold off TWO FASHION ICONS, TWO FINANCIAL O horse sense to J.C. Penney, ’ve often taken issue with the mayor of New while DVF rises. York City,but he deserves praise when he gets A cautionary tale ᮤ something right. I’m going to lose friends for that statement—and even more over my next: The pandering grandstanders braying to ban BY ADRIANNE PASQUARELLI carriage horses from Central Park are wrong. I Last summer, New York’s elite gathered at Typically, Mayor One-Percent has stressed a fi- the New York Public Library for an elegant nancial argument (“Tourists love ’em”) in making his black-tie event to honor fashion designer case to keep the horses.This is one rare instance when Diane von Furstenberg, who was being awarded the Municipal Arts Society’s I am all for his at- ing to torture prestigious Jacqueline Kennedy Onassis tempts to turn poor, defenseless Medal.Ms.von Furstenberg,credited with midtown into a animals on our rejuvenating the meatpacking district into tourist petting crowded, noisy, a fashion destination, regaled the crowd zoo. dangerous city with tales of her relationship with Mrs. I once lived in streets? Person- Onassis, while stressing the importance of the Village be- ally, I love the the fashion industry in New York. fore I moved sounds of clip- “She was a really inspiring honoree,” closer to our cen- clops, whinnies said MAS President Vin Cipolla. “Diane tral business dis- and neighs.I find has absolutely helped keep New York at trict,and much as the horses a civi- the forefront as a fashion leader and has I am now incon- MICHAEL lizing presence, a been a neighborhood catalyst as well.” venienced by the GROSS reminder of a As Ms. von Furstenberg was receiving thronging slower-paced, far her award, the fashion brand of another tourists in mid- more gracious powerful and charismatic visionary, Liz town—many of whom are in New York,where carriage rid- Claiborne, was being sold off to value de- dire need of urban walking ing in Central Park was the partment store J.C. Penney. Once upon a lessons—they are less of a height of fashion. Today, a time, it was the biggest women’s fashion nuisance than the NYU stu- holiday carriage ride may be a label in the world and the lead division in dents in my old hood who got cliché, but that’s only because multibillion dollar conglomerate Liz their kicks by tossing full the appeal is real—there’s Claiborne Inc., where it raked in some paint cans and fireworks from truth in the enchanted faces $2.2 billion in sales. It sold to Penney last dorm windows. (Can we ban of the children of all ages in month for less than $270 million. NYU students? No, that’s the carriages. “To go from [being] the largest iconic probably a nonstarter.) I wonder how Tony Avel- fashion brand in the country and the Those students presum- la’s forebears got around be- world, to being a proprietary brand at a ably explain the remarkable fore the internal combustion large retailer is an uncommon journey,” persistence of the hissing engine? And I wonder if he’ll said Marshal Cohen,chief industry analyst “Pssst … smoke?” guys in adopt some of those lovely, at market research firm NPD Group Inc. Washington Square Park. newly unemployed horses? The divergent fate of the two brands Tourists explain the persist- Horseburgers, anyone? is, at its heart, a cautionary tale for any ence of the world-class shop- Mostly, though, I find it company whose success is intimately con- ping districts of Madison and curious that one of the leaders nected to an iconic leader. In both cases, Fifth avenues.They of the anti-carriage See DESIGNERS’ FATES on Page 26 also explain the A carriage horse forces,which persistence of the propose that they carriage horse,even ride may be be replaced by as the steeds appear a cliché, electric-powered to be anachronisms faux Model Ts (the to some. but only ultimate symbol of NYC bellwether “There is a rea- because … Detroit?), is son horse-drawn Steve Nislick. He’s carriages don’t ex- the appeal the chief executive ist anymore,” for- is real of Edison Proper- takes a break mer City Council ties, which owns member Tony warehouses and Avella, now a parking lots in far- er in six months.That’s a huge shift for member of that west midtown, SL Green shifts a company widely regarded as a bell- highly respected Albany which happens to also be from acquisitions wether for the industry, and that had body, the state Senate, told home to the city’s five carriage been on an acquisition binge since the the Daily News recently in horse stables. to filling what it has end of 2009. In recent months, how- support of legislation he’s in- The nonprofit advocacy ever, soaring prices have dulled the troduced to ban the horses organization Mr. Nislick co- company’s appetite for acquisitions. from . It’s likely founded, New Yorkers for BY THERESA AGOVINO Since 2009, the average price of a that few,if any,of Mr.Avella’s Clean, Livable and Safe midtown Class A building has nearly TALL ORDER: 180 Maiden Lane needs work. constituents care—they’re in Streets, maintains that a In the last six months, SL Green Real- doubled, according to Cushman & Queens, where tourists rarely horse ban would represent “a ty Corp. has sold one property, moved Wakefield Inc. tread. So presumably no one windfall for the carriage in- to sell another two and announced two towers—with 25.5 million square feet has pointed out to him that dustry from the sale of its retail deals—one of which included Too few deals of office space—that it already owns. horse-drawn carriages and multimillion-dollar stables three residential buildings, the compa- “There is just so much capital chas- For the time being, the only additions working horses still exist all alone,” 64,000 square feet of ny’s first-ever such investment. ing so few deals now,” said Andrew will likely be in its portfolio of retail over the world, in settings “valuable real estate on lots Yet, until earlier this month, when Mathias, SL Green’s president. properties, as well as its number of both rural and urban. that could accommodate up the city’s largest commercial landlord With prices prohibitively high and property loans. What’s wise about, as the to 150,000 square feet of de- purchased a stake in a downtown sky- the economy still weak, SL Green is “Our number-one focus is to finish neigh-sayers have it, continu- velopment.” ’Nuff said? scraper,it hadn’t bought an office tow- instead focusing on filling up the 34 See SL GREEN on Page 26

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IN BRIEF

different fates BEST-SELLING AUTHOR AND SELF-DESCRIBED “TRANSMEDIA” ENTREPRENEUR JAMES FREY is expanding his SoHo-based production company. Full Fathom Five, which has contracts for 30 books and development deals L OUTCOMES for two television series, will open a Los Angeles office in January, Mr. Frey said. His company also is extending its reach with the e-book release of The Nightworld, a young adult novel written in tandem with the video game of Liz Claiborne Diane von the same name from developer Glu Mobile. ᮤ YEAR FOUNDED: Furstenberg The game will be available Dec. 1 on the iPad 1976 and iPhone; HarperCollins will publish a ᮤ YEAR FOUNDED: hardcover edition of the novel in April. Expect HEADQUARTERS: 1972 more literary-gaming collaborations, said Mr. Garment district Frey, who remains best known for the fracas HEADQUARTERS: that arose over fabrications in his 2003 memoir STORES: Sold at J.C. Meatpacking district A Million Little Pieces. Penney STORES: A FIVE-BUILDING COMPLEX IN WILLIAMSBURG, SIGNATURE DESIGN: 44 stand-alones; also , THAT IS HOME TO BROOKLYN Chic separates at department stores Brewery was recently sold for $16.4 million.The new owner of the 135,000-square-foot, mixed- SIGNATURE DESIGN: use property at 118 N. 11th St. has long-term Wrap dress plans to convert the site into residential use, said Neil Dolgin, co-president of brokerage Kalmon Dolgin Affiliates. But that switch could take years. Brooklyn Brewery’s lease, for instance, runs through 2025, Mr. Dolgin said. THE LATE LIZ CLAIBORNE: DIANE VON FURSTENBERG: Before she retired, Ms. The designer returned to her Claiborne’s clothing namesake company in the THE QUEENS THEATRE WILL PREMIERE A NEW company, one of the largest 1990s and reintroduced the WORK THIS SPRING BY CHET WALKER, THE in the world, gave working brand to a new generation. creator of the Tony Award-winning musical women fresh new looks for Fosse.The production is a musical tribute to the office. Jack Cole, the father of theatrical jazz and choreographer of movies like Some Like It Hot. It’s slated to run May 3 through May 20. Mr. Walker’s Walkerdance recently became the first resident dance company in Queens Theatre’s 21-year history.This season, the first under the theater’s new executive director, Ray Cullom, will offer more than 200 nights of performances on three stages, up from 60 the previous year. Ⅲ BY THE NUMBERS

Weekly shift of the city’s economy é US AND THEM Europe’s leaders have long fallen short in their efforts to fix their economy. With the death of the deficit reduction panel last week, ours did as well. 4M $15,670 14.6% BIRTHS in the PRICE of one-way RISE IN PRICE photos: newscom U.S. last year, first-class Air of gallon of gas fewest since France ticket from in NYC, year 1999 NYC to Paris over year Source: National Source: The New York Source: U.S. Energy Center for Health Times Information Statistics Administration

An e-book piracy whodunit DISMAL HOLDING PATTERN The unemployment rate in New York City has barely budged over the past year.

them—say that convincing to a 2010 study by Attributor, 9.0% 9.0% Wiley leads the charge these consumers that they are an antipiracy technology com- 8.8 8.9% against file-share sites indeed stealing is crucial to pany that works with major 8.8% 8.8% 8.6 8.7% 8.7% the industry’s antipiracy bat- publishers, illegal downloads 8.6% tle. So are tougher laws. Two cost the book industry,includ- and users; D.C. bills 8.4 highly controversial proposed ing educational publishers, seen as overreaching bills would go after so-called $2.8 billion annually.The Mo- 8.2 rogue sites that traffic in thou- tion Picture Association of ’10 ’11 8.0 BY MATTHEW FLAMM sands of illegal downloads of America, meanwhile, claims Oct. Dec. Feb. Apr. June Aug. Oct. all kinds of material. that makers of movies, music, Source: U.S. Bureau of Labor Statistics Jason, a 29-year-old Manhattan publicity Book piracy is at least as old software and video games lose executive, bought an iPad2 in August and as Xerox machines, but the A STEAL: Wiley has sued over $58 billion a year to piracy. ADDICTED TO NUMBERS? began downloading e-books. He now has digital transition has raised e-theft of its Dummies’ series. But publishers are taking GET A DAILY DOSE AT @STATSANDTHECITY some 50 titles, including Water for Ele- the stakes.E-books now make the problem seriously.Just last phants, the Twilight series, all of Harry Pot- up 20% of sales for the major month, John Wiley & Sons vol. xxvii, no. 48, november 28, 2011—Crain’s New York Business (issn 8756-789x) is published weekly, except for double issues the ter,The Help,and the Game ofThrones series. houses—more than double their portion in sued 27 “John Does” in federal court over weeks of July Fourth, Labor Day and Christmas, by Crain Commu- He hasn’t paid for any of them, but he 2010. And their sales growth will only soar the illegal downloading of the publisher’s nications Inc., 711 Third Ave., New York, NY 10017. Periodicals postage doesn’t feel guilty.“I don’t feel like I’m run- as low-priced, browser-enabled e-readers For Dummies books—the first time that a paid at New York, N.Y., and additional mailing offices. Postmaster: Send address changes to: Crain’s New York Business, Circulation ning into Barnes & Noble and stealing a such as the Kindle Fire and the Nook publisher has targeted consumers.The As- Department, 1155 Gratiot Avenue, Detroit, MI 48207-2912. for sub- book,” he said, though he spoke on condi- Tablet flood the market this holiday season. sociation of American Publishers also has scriber service: Call (877) 824-9379. Fax (313) 446-6777.$3.00 a copy, $99.95 one year, $179.95 two years. (GST No. 13676-0444-RT) tion that he not be identified. As far as losses owing to piracy,publish- joined the copyright-holder chorus push- ©Entire contents copyright 2011 by Crain Communications Inc. Book publishers know of many Jasons, ers are hardly in the same league as the ing for stronger legislation. All rights reserved. and—like music label executives before recording and movie industries. According See e-BOOK PIRACY on Page 26

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Cuomo’s pension paradox IN THE MARKETS Governor asking for tier known as Tier VI. One labor in- ees Federation, the state’s largest sider said that some union officials two public-sector unions, adamant- by Aaron Elstein labor’s help, sacrifice are asking, “How do we go to our ly oppose Tier VI. Sources said that members and say we’re going to do when administration officials met this, if at the same time the governor with leaders of key public- and pri- BY DANIEL MASSEY is trying to decimate our pensions?” vate-sector unions this month to discuss details of the infrastructure Two of Gov. Andrew Cuomo’s top Chops in benefits sought bank, labor officials at the meeting priorities could be on a collision Talks on the infrastructure bank raised concerns about Tier VI and course.He desperately wants to cre- are still in an early stage, but already other Cuomo positions that run ate jobs to help the state’s sputtering there are signs that Mr. Cuomo counter to organized labor’s inter- economy. And he needs a cheaper might have to juggle his political pri- ests, such as budget cuts and letting pension tier for public employees to orities. He introduced legislation in the millionaire’s tax expire. lighten the load on the state’s budg- June to raise the retirement age to 65 Mr. Cuomo is likely to try to push BOK JOY: et. But to create those jobs, the gov- from 62, have new employees con- pension reform and the infrastructure Greenhill CEO ernor is eyeing union pension funds tribute 6% of their salaries to pen- bank initiatives down separate paths. Scott Bok to finance major projects,such as re- sions (up from the current 3% for new He has proven in his first year as gov- building the Tappan Zee Bridge. hires), require 12 years of service (up ernor to be a gifted tactician and could “We have to turn around the from 10) before pensions vest, and pull it off, potentially with help from economy; we have to create private- stop overtime pay from inflating the building-trades unions, which sector jobs,” Mr. Cuomo said in a ra- pensions, among other changes de- have backed his conservative fiscal dio interview last week. “That’s the signed to save the state billions. agenda and are desperate for jobs af- goal.I’ve been spending months talk- “The numbers speak for them- ter the real estate crash. newscom ing about the best approaches,how to selves—the pension system as Another challenge for Mr. Cuo- bring people together. One of the we know it is unsustainable,” Mr. mo is to make infrastructure projects Cut his dividend? Good luck with that tasks is to find alternative financing.” Cuomo said upon introducing the attractive investments for the pen- As the governor proposes a so- proposal. sion funds, said Kevin Corbett, co- here’s still more than a month to go in 2011, but called infrastructure bank, he is Both the Civil Service Employ- chairman of the Empire State Trans- already we have a clear winner in the category of pledging to push for the new pension ees Association and Public Employ- See PENSION on Page 28 Quote of the Year from a grandee. T Scott Bok It comes courtesy of , the chief executive of Greenhill & Co., a boutique investment adviser whose blue- chip clients range from AT&T to the U.S. Treasury. Asked at a recent conference if he’d consider cutting Greenhill’s shareholder dividend, Mr. Bok replied: “You’d have to We congratulate our client waterboard me [first],” according to Bloomberg News. Setting aside Mr. Bok’s tortured choice of words, why would he feel so strongly about preserving his firm’s dividend? Well, here’s a possib