In Themarket

Home , 220 Central Park South, 660 Fifth Avenue, One57, Salesforce Tower

® MARCH 14-20, 2016 | PRICE $3.00 NEW YORK BUSINESS

DONALD TRUMP’S ACCOUNTANTS IDENTIFIED P. 6 The waiting is killing them P. 9 THE LIST New York’s largest minority-owned companies P. 11

IN THE MARKET New York’s real estate boom is showing signs of coming apart, and the pessimism centers on the luxury supertowers reshaping the city’s skyline

VOL. XXXII, NO. 11 WWW.CRAINSNEWYORK.COM By DANIEL GEIGER PAGE 12

ALSO One developer’s high-rise free-fall PAGE 14 NEWSPAPER

MARCH 14-20, 2016

FROM THE NEWSROOM | JEREMY SMERD The art of thinking big IN THIS ISSUE 4 AGENDA 5 IN CASE YOU MISSED IT LONG BEFORE HE WAS THE producing artistic director of the Chairman of the Port Authority Classical Theatre of Harlem, Ty Jones ran a painting 6 POLITICS outlines his priorities company, where he managed payroll, paid workers’ 8 ASKED & ANSWERED compensation and bid for contracts. Andrea Miller founded 9 FOOD Gallim Dance, and then spent six years running every aspect 10 VIEWPOINTS of the organization before she could afford to hire an 11 THE LIST executive director and focus solely on choreography. And M.A. Papper, artistic director of The Town Hall, counts as FEATURES essential the lessons he got in the art 12 CRACKS IN THE MARKET of marketing from jazz impresario George Wein. “The first When you are an thing George told me is headliners sell tickets,” Papper said. 14 DEVELOPER STRIKES OUT “And it’s true.” “artistic director, 19 GOTHAM GIGS The artistic directors I spoke with last week in advance of you learn failure 20 EXECUTIVE MOVES our March 15 Arts and Culture Breakfast reach for the sky really quickly 21 SNAPS but keep their feet planted firmly on the ground. Don’t let 22 FOR THE RECORD the word “nonprofit” fool you, said Andrew Byrne, artistic 23 PHOTO FINISH director of Symphony Space. “We must be responsible fiscally,” he said. “We have to support our programs.” Everyone in the arts knows this. But perhaps not so many outside it. It’s easy to think that there’s easy money to be found in New York’s arts world when you read about big-name cultural institutions getting $100 million gifts and contract negotiations of operatic proportions. Like for-profit businesses, many small and midsize cultural organizations live hand-to-mouth, trying to cultivate a paying audience. The artistic director is a risk-taker. “When you are an artistic director, you learn failure really quickly,” Papper said. 19 Max Zanan That may be the cost of thinking big. Miller got an early meeting with Jim P. Herbert, the co-founder of First Republic Bank and board member of Lincoln Center and the Joyce Theater. He came to a rehearsal where Miller showed him her business plan and asked for $30,000. He turned her down, but he liked her chutzpah. “He became a mentor,” she said, and eventually a financial supporter. Trusted advisers are key for any professional. Artists may be particularly oriented toward community, perhaps because art is often collaborative and because running a nonprofit tends to cultivate a less cutthroat mindset. ON THE COVER When Jones took the reins of the theater and dug it out of a financial hole, he COMPOSITE BY: reached out to artists he respected for advice. Lou Bellamy, founder of the JENNIFER BALLONE Penumbra Theatre Company, “sat me down and gave me a masters class,” Jones said. His advice? Diversify your revenue; cultivate corporations, individuals; go into schools and teach. “I think being an entrepreneur is a lot of times like being an actor,” Jones said. “What you are doing is playing many different characters.” DIGITAL DISPATCHES Go to CrainsNewYork.com CONFERENCE CALLOUT MARCH 22 READ Madison Square Tavern, a gastropub CRAIN’S BUSINESS blocks away from OF STARTUPS Madison Square Garden, fell victim to a common LEARN HOW to get startups off restaurant pitfall: the ground and grow them. > construction delays. The Panelists include Howard Lerman, pub filed for Chapter 11 CEO of Yext; Rachel Shechtman bankruptcy seven months after opening. The (pictured left), CEO of Story; and owner hopes to keep it open. Small Business Commissioner ■ Gregg Bishop. The developers of Industry City gave it the old college try—but failed in their effort to JOHN JAY COLLEGE OF CRIMINAL JUSTICE build dormitories at the Sunset Park, Brooklyn, complex after the community said 8:30 a.m. to 10 a.m. it didn’t want residents in the area. The 32- [email protected] acre site will instead be transformed into retail and hotels. Vol. XXXII, No. 11, March 14, 2016—Crain’s New York Business (ISSN 8756-789X) is published weekly, except for double issues the weeks of June 27, July 11, July 25, Aug. 8, Aug. 22 and Dec. 19, by Crain Communications Inc., 685 Third Ave., LISTEN to a discussion of Donald Trump’s New York, NY 10017. Periodicals postage paid at New York, NY, and additional mailing offices. Postmaster: Send address wealth and learn more about falling real estate changes to: Crain’s New York Business, Circulation Department, 1155 Gratiot Avenue, Detroit, MI 48207-2912. prices. Music by Christian Gibbs. For subscriber service: Call (877) 824-9379. Fax (313) 446-6777. $3.00 a copy, $99.95 one year, $179.95 two years. CrainsNewYork.com/podcast (GST No. 13676-0444-RT)

MARCH 14, 2016 | CRAIN’S NEW YORK BUSINESS | 3 AGENDAWHAT’S NEW MARCH 14, 2016

Stop subsidizing pay for private-sector workers

he slippery-slope argument is one we use sparingly because it is so often abused to undermine sensible proposals. Unable to discredit an idea on the merits, oppo- nents warn that it will lead to all sorts of far-fetched con- CHECKBOOK Tsequences. Remember Michael Bloomberg’s request to ban the use of POLITICS: The mayor is using food stamps to buy soda? Critics claimed it would open the door to all public funds manner of government interference in consumers’ choices. to raise pay Unfortunately, they succeeded: Supplemental Nutrition Assistance at private businesses. Program benefits are still wasted on sugary drinks with not an ounce of nutrition in them. Similarly, the mayor’s congestion-pricing plan ers—with no reliable measure of the quality of services they provide. was killed in part by predictions that tolls would soon be jacked up to But that was no surprise, because in 2014 the mayor and City Council unaffordable levels. came up with $42 million—in the middle of the fiscal year, no less—to But in the case of the de Blasio administration’s using taxpayer dol- raise the pay of school-bus drivers at private companies that had won lars to subsidize the pay of private-sector workers, the slippery slope city contracts through a competitive process. De Blasio deliberately is not some distant mirage. We are already sliding down it. gave back the savings that the Bloomberg administration had The mayor’s office is engaged in achieved by bidding out the routes for negotiations over how much private De Blasio’s moves on bus drivers and the first time in memory. nonprofits will have to pay their Workers for other city contractors teachers under city contracts to nonprofits’ teachers show the slippery took notice. Rather than bargain with operate prekindergarten programs. slope is not some distant mirage. We their employers for higher pay, they can The teachers are seeking the same are already sliding down it now turn to de Blasio, who is sensitive to salaries that public-school instruc- political pressure and has staked his tors get under the United Federation mayoralty on reducing income inequali- of Teachers’ collective-bargaining agreement, though they are nei- ty. With an $82 billion city budget and rising tax revenue, the mayor ther UFT members nor city employees. To pressure Mayor Bill de must seem like a rich uncle. Let’s hope he doesn’t feel like one, too, Blasio, they held a rally at City Hall last week. because there are many thousands of private-sector employees provid- Undoubtedly, they will succeed: The city’s participation in talks ing social services and other functions farmed out by the city. They between the teachers and their employers signals the mayor’s will- would be fools not to line up at City Hall behind the private bus drivers ingness to use public money to boost the pay of private-sector teach- and teachers, hats in one hand and bullhorns in the other. – THE EDITORS

FINE PRINT New homes and their contents burn eight times faster than older homes and furniture, according to Dan Schwertfeger, president of the New York State Association of Fire Chiefs, which launched a campaign last week to spur New Yorkers to install home sprinkler systems. “In many cases, new homebuyers are spending more for granite countertops in their kitchens than it would cost to add fire sprinkler protection throughout their home,” Schwertfeger said.

BY PETER D’AMATO STATS 25 WORDS OR LESS PARKING-TICKET DIPLOMACY UNPAID PARKING FINES from vehicles with diplomatic plates plummeted after the city said in Cuomo is the best 2002 it would not renew the registrations of those that had piled up violations. But recently CITY AND THE “ the delinquencies have shot back up. governor we’ve Amount of unpaid parking fines generated in 2015. ever had for $185,400 Unpaid fines had been below $100,000 from 2003 making transit to 2012 Number of unanswered violations that announcements, 3+ cause a diplomat’s registration not to but then the be renewed money isn’t there ” Fines owed by $1,988,437 Egypt, the worst —John Raskin, executive director of offender the Riders Alliance, an advocacy group, after Andrew Cuomo promised Total unpaid fines $16.02M owed to New York City, down new, high-tech buses from about $21 million in 2001

ADDICTED TO NUMBERS? GET A DAILY DOSE AT @STATSANDTHECITY SOURCES I Quant NY, NYC Department AP IMAGES of Finance, NYC Mayor’s Office, NYC Department of Finance

4 | CRAIN’S NEW YORK BUSINESS | MARCH 14, 2016 AGENDA ICYMI EDITOR IN CHIEF Rance Crain publisher, vp Jill R. Kaplan assistant to the publisher After tarnished Silver, Alexis Sinclair, 212.210.0701 EDITORIAL Heastie burnishes his brand editor Jeremy Smerd assistant managing editors Erik Engquist, Peter S. Green web editor Amanda Fung ssembly Speaker Carl Heastie last week copy desk chief Steve Noveck art director Carolyn McClain unveiled an array of ethics reforms intended photographer Buck Ennis to help clean up Albany—or at least give the senior reporters Joe Anuta, Aaron Elstein, Matthew Flamm, Daniel Geiger A reporters Rosa Goldensohn, Jonathan impression of leading a virtuous effort. LaMantia, Caroline Lewis, Addie Morfoot Heastie proposed fixes that had government data reporter Gerald Schifman web producer Peter D’Amato watchdog groups howling with approval, including columnist Greg David contributing editors Tom Acitelli, limits to legislators’ outside income and fundraising. Theresa Agovino, Barbara Benson, Erik Ipsen, Suzanne McGee, He would close one loophole that allows real estate Judith Messina, Cara S. Trager interests to donate outsize sums through opaquely ADVERTISING www.crainsnewyork.com/advertise named limited-liability companies, and another that advertising director Irene Bar-Am [email protected] or lets donors lavish unlimited amounts of cash on 212.210.0133 political parties’ so-called housekeeping accounts, senior account managers Zita Doktor, Jill Bottomley Kunkes, Rob Pierce, through which it is then doled out to candidates. Stuart Smilowitz account managers Jake Musiker Lawmakers would also be required to work for senior marketing coordinator LeAnn Richardson whatever they earn, rather than take a post at a law sales/events coordinator Ashlee Schuppius 212.210.0282 firm and collect referral fees. [email protected] The proposals, which would limit outside earnings to $77,000, aim to screen out much of the behav- ONLINE general manager Rosemary Maggiore ior that led to the felony conviction last year of Heastie’s predecessor, Sheldon Silver. 212.210.0237 [email protected] But the reforms require approval from the Republican-controlled state Senate, which has resisted CUSTOM CONTENT director of custom content them in the past. That could allow Assembly Democrats to vote for the measures without fear that they Patty Oppenheimer 212.210.0711 would become law. Small loopholes could also undermine the effort, said Dick Dadey, executive director [email protected] EVENTS of good-government group Citizens Union. www.crainsnewyork.com/events Crain’s director of conferences & events Speaking at a breakfast forum, Heastie denied that corruption in Albany is widespread, Courtney Williams, 212.210.0257 instead blaming scandals on “bad apples.” Whether his ethics plan will shake the tree remains [email protected] manager of conferences & events to be seen. — ROSA GOLDENSOHN Adrienne Yee AUDIENCE DEVELOPMENT director of audience & content DATA POINT partnership development Cable OK Side of Manhattan. The developer Michael O’Connor, 212.210.0738 NEW YORK CITY IS EXPECTED TO [email protected] Charter Communications moved has acquired a site and adjacent CRAIN’S 5BOROS one step closer to its $55.1 billion ATTRACT 59.7 MILLION VISITORS THIS properties on 11th Avenue and West www.5boros.com acquisition of Time Warner Cable. 37th Street for an undisclosed sum Irene Bar-Am, 212.210.0133 [email protected] The city approved the deal, but in YEAR, EXCEEDING LAST YEAR’S that could yield a 1.3 million- SPECIAL PROJECTS order to get the green light, Charter RECORD BY 2.4%, PUTTING THE CITY square-foot building. Tishman manager Alexis Sinclair 212.210.0701 had to commit to increasing com- recently unveiled drawings of its [email protected] ON TRACK TO REACH 67 MILLION REPRINTS pany diversity and improving first Hudson Yards tower, a Bjarke reprint account executive Krista Bora public-access programming. If the ANNUAL VISITORS BY 2021, Ingels-designed skyscraper with 212.210.0750 transaction goes through, Charter spiral landscape terraces. PRODUCTION ACCORDING TO NYC & COMPANY. production and pre-press director will become the nation’s second- Simone Pryce largest cable provider, behind media services manager Nicole Spell Comcast. California is the final state SUBSCRIPTION CUSTOMER SERVICE www.crainsnewyork.com/subscribe that needs to vote on the deal. [email protected] overlooking Bryant Park, will 877-824-9379 (in the U.S. and Canada). Big exchange become Salesforce Tower New York. $3.00 a copy for the print edition; or $99.95 one year, $179.95 two years, for print Nasdaq agreed to buy Deutsche The cloud-based software company subscriptions with digital access. Boerse AG’s International Securities will consolidate its operations in to contact the newsroom: www.crainsnewyork.com/staff Exchange for $1.1 billion in a trans- three Manhattan offices into about 685 Third Ave., New York, NY 10017-4024 action that would make it the 300,000 square feet at 3 Bryant phone: 212-210-0100 fax: 212-210-0799 largest operator of U.S. options Park. Last year, MetLife said it Entire contents ©copyright 2016 exchanges. The deal, expected to would be leaving that tower as part Crain Communications Inc. All rights reserved. ®CityBusiness is a registered close in the second half of the year, of its plans to relocate employees Sleek new MTA buses trademark of MCP Inc., used under license agreement. would be Nasdaq’s fourth recent into bigger space in the MetLife Thousands of buses outfitted with acquisition, including its purchase Building at 200 Park Ave. CRAIN COMMUNICATIONS INC. Wi-Fi and USB charging ports will BOARD OF DIRECTORS of Second Market, a platform for be rolled out across the city chairman Keith E. Crain trading shares of private companies. J.Crew struggles president Rance Crain during the next five years. The Private-equity shop TPG Capital treasurer Mary Kay Crain, Cindi Crain fleet will cost $1.3 billion and executive vp, operations William Morrow WeWork targets Asia reduced its stake in ailing retailer executive vp, director of strategic replace more than 40% of the Manhattan-based WeWork raised J.Crew by 84% at the end of last operations Chris Crain Metropolitan Transportation executive vp, director of corporate $430 million from Chinese investors year. TPG, which led a leveraged operations K.C. Crain Authority’s existing buses. The led by investment firms Legend buyout of J.Crew in 2011, managed senior vp, group publisher David Klein model, which will debut in vp/production, manufacturing David Kamis Holdings and Hony Capital, pushing to earn $357 million in dividends Queens, has a “European flair” chief financial officer Thomas Stevens the firm’s valuation to $16 billion. and fees as of June 2015. J.Crew is chief information officer Anthony DiPonio The company will use the money to burdened by $2.1 billion of debt. and “almost a Ferrari-like look,” founder G.D. Crain Jr. [1885-1973] expand in Asia. said Gov. Andrew Cuomo, a chairman Mrs. G.D. Crain Jr. [1911-1996] Another Hudson Yards tower muscle-car and motorcycle secretary Merrilee Crain [1942-2012] Salesforce replaces MetLife Tishman Speyer plans to build a enthusiast.

BUCK ENNIS The MetLife Tower on Sixth Avenue, second office tower on the far West

MARCH 14, 2016 | CRAIN’S NEW YORK BUSINESS | 5 AGENDA POLITICS

How much is Trump worth? WeiserMazars knows

The Donald’s ‘big’ accounting firm is actually ranked No. 24 BY AARON ELSTEIN

eiserMazars, an returns, heads WeiserMazars’ Long widespread inter- accounting firm that Island real estate practice. He did not est. The benefit, virtually no one has return a call. called the STAR heard of, is privy to Without help from his account- program, offers somethingW that almost everyone ants, calculating Trump’s wealth—a about a $300 credit wants to know: Donald Trump’s net key element of Donald Trump’s to hundreds of worth. appeal—is tricky, even for the thousands of New WeiserMazars’ clients include a staffers at the Internal Revenue York homeowners taxi-medallion lender and a small Service. They’ve been auditing whose incomes are perfume maker. It’s also Trump’s Trump for a under $500,000. The place five years ago and that the city accounting firm, Crain’s has ascer- dozen years, city said it checks erred in granting it to him. The city tained, although the Republican the onetime annually with the replied that Trump shouldn’t have front-runner won’t name it, referring casino owner The mystery only state, which received the abatement and is to it only as a “big accounting said. The IRS deepened after processes people’s demanding he return the approxi- firm–one of the most respected.” It is, won’t confirm tax returns, to make mately $900 it yielded him. in fact, the nation’s 24th largest such whether it is Crain’s reported that sure STAR applicants Neither the city nor the state firm. Respected? Certainly. Big? No. reviewing fall under the would say whether its checks The firm is not eager to trumpet Trump’s fil- the GOP front-runner income limit. showed Trump’s personal income its relationship with The Donald, ings, and says got a tax break reserved Perhaps the fact was under $500,000 a year, or and would not comment for this audit or no that Trump qualifies whether in fact it had properly veri- story or confirm Trump is a client. audit, Trump for the middle class for the benefit means fied Trump’s income. It said only that However, public filings show the is free to make his annual income is Trump got the benefit starting in foundations controlled by Trump his returns less than $500,000, 2014 after his Park Avenue residence and his son Eric are both audited by public. which certainly was disqualified from the STAR pro- WeiserMazars. Fellow accountants That’s why the discovery last would cast his claims of being gram and that the credit was “auto- say it’s routine for their firms to week by Crain’s that Trump has reg- “really rich” into doubt. Trump’s matically” applied to his Fifth audit the charitable activities of their ularly received a middle-class tax camp insisted the candidate didn’t Avenue penthouse. How did that top business clients. And Donald credit on his multimillion- apply for the credit after the happen? Who “automatically” did Bender, who signed the foundations’ dollar Fifth Avenue condo provoked $500,000 threshold was put in that? No one will say. Ⅲ

Wall Street’s warning found that regulated financial insti- Long shot The city’s leading business group tutions are primarily hiring people Wendy Long faces terrible odds in her singled out Mayor Bill de Blasio after in compliance and risk manage- race against Democratic Sen. Charles annual Wall Street bonuses fell for ment, while paring back bonus- Schumer, but the Republican’s gambit the sixth time since the financial generating jobs in trading and could pay off in one way. It may help crisis. underwriting. — ERIK ENGQUIST her raise money to retire $282,546 in Kathryn Wylde (pictured), the campaign debt from her 2012 bid president and CEO of the Partnership Let them smoke weed against Sen. Kirsten Gillibrand. for New York City—which counts Assemblyman Richard Gottfried, “That administrative aspect of her financial institutions among its D-Manhattan, last week took an- candidacy is probably the main moti- members— other step in his crusade to open vation,” said political consultant and called the find- the constricted medical-marijuana former Schumer aide Michael Tobman. ings in a state industry to new players and a broad- Pols aim to deflate Airbnb “She’s taking one for the team and if it comptroller’s er patient base. Two City Council members offered helps zero out her earlier campaign report “clear Gottfried has been less than investment advice last week to debt, who’s to begrudge that?” evidence that pleased with the number of conces- stakeholders in home-sharing behe- But Long said, “I’m running the tough new sions that had to be made for Gov. moth Airbnb. Helen Rosenthal, because Chuck Schumer has failed financial regula- Andrew Cuomo to sign the D-Manhattan, and Jumaane middle-class New Yorkers and endan- tions put in Compassionate Care Act into law in Williams, D-Brooklyn (pictured), gered our national security.” place in the past July 2014. The assemblyman intro- advised Amazon founder Jeff Bezos A Manhattan attorney who once five years are duced bills that would authorize and venture-capital powerhouse clerked for Supreme Court Justice hurting New nurse practitioners and physician Andreessen Horowitz to break ties Clarence Thomas, Long plans to hire York, in terms of both economic assistants (in addition to doctors) to with the business, promising a only two campaign staffers and serve activity and tax revenues.” recommend marijuana; eliminate the crackdown on illegal hotel hosts. as her own press secretary. Schumer Wylde said de Blasio and other rule compelling cannabis dispen- “If we were invested in a company has a $22 million war chest. politicians calling for more regula- saries to be run by the same compa- that knowingly engaged in so much Long has made no effort to pay her tion of the financial industry “need nies that grow the product; and allow illegal activity, we would think twice old campaign bills, according to one to keep in mind that the financial cannabis to treat severe or chronic about keeping our money in that longtime Republican operative. Long’s industry is responsible for approxi- pain. A fourth bill would even allow company,” the lawmakers wrote. 2012 defeat saw Gillibrand win a record mately 40% of our local economy patients to smoke it, except where Airbnb has 40,000 listings in the 72% of the vote, topping Schumer’s and directly contributes almost tobacco smoke is not allowed. As the city and claims the vast majority are 70% mark in 2004. 20% of our tax revenues.” Three law currently stands, cannabis can be offered by individuals in accordance “I don’t know why she’s running,” days later, the mayor met behind consumed only in vapors, pills or with the law. A company spokesman the GOP operative said. “One would closed doors with the Partnership’s other nonsmokable forms, which said the council members were “com- have thought she would have learned executive committee. drives some patients away. mitted to punishing middle-class her lesson the first time.”

BUCK ENNIS, BLOOMBERG A Partnership survey last year — CAROLINE LEWIS New Yorkers.” — ROSA GOLDENSOHN — ROSA GOLDENSOHN

6 | CRAIN’S NEW YORK BUSINESS | MARCH 14, 2016 Small business is better on a better network.

Give your business the speed of a 100% fiber optic network with 99.9% network reliability and the fastest Wi-Fi available.* Only Fios gives you uploads as fast as downloads up to 500 Mbps.

Hurry – offer ends 4.2.16. Last chance to get a $250 Visa® Prepaid card when you bundle 50 Mbps or faster Internet and phone. With a 2-yr agmt that auto-renews.

888.960.8111 I verizon.com/fiosbiz

*Based on internet speed plans and maximum router throughput available. Verizon Visa Prepaid Card issued by MetaBank®, Member FDIC, pursuant to a license from Visa U.S.A. Inc. Use everywhere Visa debit cards are accepted. This optional offer is not a MetaBank product or service and MetaBank neither endorses nor sponsors it. Must register for card online and keep qualifying Verizon service for 60 days with no past-due balance. Card mailed within 90 days of install date. Offer requires two year agreement. Limit one card per account. Other card terms and conditions apply. Offer available to new business customers in select areas only, subject to credit review. 2 year term automatically renews at then-current term rates unless cancelled within 30 days prior to or 60 days after term is renewed. Promotional offers do not apply to service ordered for temporary, short term or special events. Backup battery available for FiOS voice services & E911. Service availability & actual speeds vary. Offer ends 4/2/16. © 2016 Verizon. AGENDA ASKED & ANSWERED TRANSPORTATION

BY DANIEL GEIGER

JOHN DEGNAN Chairman of the Port Authority

ohn Degnan was appointed chairman of the Port Authority of The CEO New York and New Jersey’s board of commissioners in April position was cre- 2014 by New Jersey Gov. Chris Christie. He has helped steer “ ated to end the the authority through reforms in the wake of the “Bridgegate” Jscandal, and is leading the search for a CEO to depoliticize political process the bistate agency.Degnan previously was vice chairman governing and chief operating officer of the Chubb Corp., an insurance firm, the agency and served as New Jersey’s attorney general from 1978 to 1981.

Where does the search for a new CEO stand? I’m hopeful that no later than the end of June we’ll have a CEO to recommend.

What have been the issues? The salary will be between $400,000 and $450,000. That admittedly may be below other jobs of this magnitude. There are no perks. There’s no E-ZPass. There’s no golden parachute.

Have politics played a role in the delay? The CEO position was created to end the political process of governing the agency. But the reforms are not embodied in legislation yet. New York passed reform, but there are legislators in New Jersey who have been unwilling to support it. DOSSIER How much should the Port pay toward Penn Station’s redevelopment? The days of the Port spending $4 billion on an Oculus are over. WHO HE IS Chairman of the The Port can’t be the source of funds that political leaders want. Port Authority of New York and New Jersey’s board of The ask for Penn Station is a contribution in the neighborhood of commissioners $150 million. Unfortunately, that expectation was based on a AGE lease agreement in 2000 that wants to charge us $10.5 million 71 a year for 250 square feet in the station. BORN West Orange, N.J. RESIDES Chester, N.J. Is the Port thinking about raising tolls to pay for any of its capital needs? EDUCATION St. Vincent’s We can’t increase tolls; we learned that in 2011. That would College, Latrobe, Pa., B.A. in affect driving habits. Our ridership dropped, and although our history; revenue went up, it didn’t rise as much as projected. Harvard Law School SPARE TIME Degnan and his How will you pay for a new Manhattan bus terminal? wife, Mary, took up golf a few If the terminal is moved west, then there’s a huge amount of years ago as a game to play money in selling the old bus terminal, and there may be together well into retirement additional air rights over what we’re building as a replacement NJ AG New Jersey Gov. Brendan terminal. Hopefully some source of federal funding will be there. Byrne appointed Degnan as the If we build a brand-new terminal, there may also be some user- state attorney general in 1978 when Degnan was 33, making him fee charges that we don’t get now. the youngest person ever to hold that position in the state. Scott Rechler, the vice chairman of the Port Authority, has backed building a TURNING POINT After three bus terminal in New Jersey instead. What do you think? years as AG, Degnan ran for I’m told by political leaders that a bus terminal on the west side governor but finished fifth. “It was humbling because I thought I was of the Hudson is a nonstarter. You’re talking about a two- or going to win. If I would have finished three-seat ride in that case, where today those riders have a second, I might have stayed in one- or two-seat ride. If we constantly twiddle our thumbs and politics.” refuse to build a bus terminal [in Manhattan], we won’t begin the BUCK ENNIS process, and I think that would be dangerously irresponsible.

What real estate should the Port sell? Political leaders say sell 1 World Trade Center and apply those funds to the bus terminal. But by using the revenue generated by the World Trade Center, we can issue bonds that pay for capital investment. We raise more money in bonds than we get in a sale. If we can identify the real estate that is not revenue- producing, those are the properties we should sell outright. The Red Hook shipping terminals are among them. Ⅲ

8 | CRAIN’S NEW YORK BUSINESS | MARCH 14, 2016 AGENDA FOOD

Cheap rent in 2018, but only Crossing. good news for old- “When you walk The new Essex school vendors includ- into the market, it’s if vendors survive until then Street Market, in Essex ing Dominican-owned like looking back on Crossing, will have Viva Produce and the history of the Essex Street Market struggles amid new development BY HILARY POTKEWITZ room for 45 stalls. The Rainbo’s Kosher Fish, Lower East Side,” said EDC has agreed to as well as hipster arti- Anne Saxelby, a cover moving expenses sanal shops such as decade-long tenant hree years also underway to install will tie in something for all existing vendors. Formaggio Essex and with Saxelby Cheese- ago, the city better signage and out- about the current Essex New tenants will have Nordic Preserves Fish & mongers and head of selected door seating, tables and Street Market,” said to pay market rates. Wildlife Co. All tenants the vendor’s associa- Delancey umbrellas on Essex Street. Rohan Mehra, a principal Existing tenants will have to do to reap the tion. “We’re an inter- TStreet Associates to “Everything we do in the Prusik Group, pay the same rent per benefits is hold on long esting mix of old and build the nine-block, going forward that’s which handles commer- square foot they had in enough to make the new—just like the $1.1 billion Essex about the new market cial leasing at Essex the old building. That’s move. neighborhood.” Ⅲ Crossing residential, commercial and retail project on the Lower East Side. That’s when things went south for the vendors at the Essex Street Market, the indoor bazaar across the street that was created by Mayor Fiorello LaGuardia in 1940. “Foot traffic has taken a nosedive, Kenneth Woods PRESIDENT AND CEO because everybody in SYLVIA’S RESTAURANT the city thinks it’s already closed or is closing any day now,” said Rhonda Kave, owner of Roni-Sue Chocolates. The developers have said the vendors would move to their new digs in 2018. But some won’t make it. Last year, four of the 25 Adding flavor to vendors folded. Kave shuttered her booth in February after eight the community. years to focus on her Forsyth Street store. Now vendors see some hope. After months of negotiations, the city’s Economic Development Corp. Understanding agreed to hand control of the markets’ promotions to the Lower East what’s important. Side Partnership. “Would it have been ideal for us to start six months earlier?” said Tim Sylvia’s Restaurant is a true Harlem institution. If you’ve ever had their special brand of soul food, you know exactly why. Laughlin, the partnership’s executive direc- Owner Kenneth Woods also prides himself on treating customers like family. And Kenneth sees that same quality in tor. “Yes. But we’re M&T Bank. He began his M&T relationship with a personal loan, but quickly became aware of what we could do for his here today, and we’re eager to focus on the business and family. The relationship has grown stronger, with Sylvia’s and M&T teaming up as active members of the next six months.” neighborhood and community at large. To learn how M&T can help your business, visit mtb.com/commercial. The market’s promotional budget increased by half, to approximately $110,000. One of the first projects was a joint effort with the Lowline Lab on a pop-up food festival that drew more DEPOSITORY AND LENDING SOLUTIONS | TREASURY MANAGEMENT | MERCHANT SERVICES | COMMERCIAL CARD than 8,500 customers. A joint project with the city’s Department Equal Housing Lender. ©2016 M&T Bank. Member FDIC. of Transportation is

MARCH 14, 2016 | CRAIN’S NEW YORK BUSINESS | 9 AGENDA VIEWPOINTS

A minimum-wage compromise Raise workers’ pay, but don’t commit to $15 an hour just yet

DETERMINED TO pass Projected state minimums, 1/1/17 a minimum-wage D.C. hike, Gov. Andrew $11.50 Cuomo is ratcheting Mass. up his campaign to $11.00 N.Y. THE BARUCH COLLEGE FUND boost the rate to $15 $10.75* an hour in the city at Conn. the end of 2018, and $10.10 Calif. GREG DAVID statewide in 2021. $10.10 Business groups, Vt. REQUEST FOR PROPOSAL $10.10 Audit, Tax and Related Professional Services especially outside the city, continue to Alaska broaden their coalition opposed to any $9.75 increase and to pressure their Senate R.I. $9.60 dŚĞĂƌƵĐŚŽůůĞŐĞ&ƵŶĚŝƐƌĞƋƵĞƐƟŶŐƉƌŽƉŽƐĂůƐ Republican allies to reject any change. Minn. ĨƌŽŵƋƵĂůŝĮĞĚƉƌŽǀŝĚĞƌƐŽĨĂƵĚŝƚ͕ƚĂǆĂŶĚƌĞůĂƚĞĚ Yet if the two sides are interested in $9.50 a compromise, one is clearly possible Wash. ƉƌŽĨĞƐƐŝŽŶĂůƐĞƌǀŝĐĞƐƚŽƉƌŽǀŝĚĞĂƵĚŝƚĂŶĚƌĞůĂƚĞĚ $9.47 - by looking at what the highest Ore. ƉƌŽĨĞƐƐŝŽŶĂůƐĞƌǀŝĐĞƐ͘ĐŽƉǇŽĨƚŚĞZ&WŝƐĂǀĂŝů statewide minimum wages will be. $9.25 www.baruch.edu/AuditRFP Here are the basic economics: A Neb. ĂďůĞĂƚ͘ $9.00 small minority of economists and a *Under Cuomo proposal ZĞƐƉŽŶƐĞƐĂƌĞĚƵĞďǇϱ͗ϬϬƉ͘ŵ͘^dŽŶƉƌŝůϭϭ͕ϮϬϭϲ larger group of conservatives argue Sources: Minimum-wage.org, Cuomo administration that any hike in the minimum wage leads employers to reduce jobs, espe- The Cuomo plan, which would d>͗ϲϰϲͲϲϲϬͲϲϲϲϴ cially for unskilled workers, and raise increase the hourly minimum wage to &y͗ϲϰϲͲϲϲϬͲϲϲϲϭ prices. Businesses in New York predict $10.75 by the end of 2016, would result ǁǁǁ͘ďĂƌƵĐŚ͘ĐƵŶǇ͘ĞĚƵ those dire consequences and more, in New York’s having one of the high- notably many employers going under. est rates in the country. (Some states A large majority of economists say shown above will nudge up their rates virtually all the recent credible in January based on inflation this year.) research shows no job loss when the Pausing at $10.75 would be a rea- minimum wage is increased by modest sonable compromise. New York could amounts. The growth in fast-food then either adjust its minimum to restaurants in the city last year even as match inflation or, even better, assess they faced a higher minimum wage is the impact of the increase and watch more proof these economists are right. what other states do before commit- But even the most progressive advo- ting to the unknown that $15 an cates of higher minimum wages admit hour brings. Ⅲ that they don’t know the consequences of large jumps over a short GREG DAVID blogs regularly at period, as the governor proposes. CrainsNewYork.com.

Only one choice for Rikers Readers say make the island a park and redevelop Gansevoort

THE IDEAS PROPOSED for placing housing march history upward in an aestheti- and other ways of densifying the cally sensitive way that respects the island in “New life for Rikers Island” past” (“A fight of historic proportions (Feb. 29) were alarming. While the in the meatpacking district,” Jan. 26). percentage of parkland in New York He hit the nail on the head. City is 20%, most of it is along the As neighborhoods like the peripheries of the city. Gansevoort Market Historic District Geographically, the communities grow, honoring history becomes surrounding Rikers Island do not have increasingly important. That does access to sufficient parkland while not mean a rigid refusal to change. having high rates of asthma and obe- It means identifying and keeping sity. The ongoing redevelopment of alive the parts of our history that Randall’s Island as quality open space make us who we are, while recog- should serve as the model. nizing where change is appropriate. The last thing we need is an isolat- Aurora and William Gottlieb Real ed island of exurbia accessible prima- Estate’s plan would restore and pre- rily by car in our geographic core. serve what makes Gansevoort Street RICARDO ZURITA what it is, while updating the remain- Ricardo Zurita Architecture & Planning der in a way that honors and evokes The writer is an architect and was an integral part of the neighborhood’s involved in the master planning of history that otherwise is in danger of Randall’s Island. being forgotten. At a time when so few develop- Gansevoort plan honors history ers demonstrate this kind of sensi- Crain’s Editor Jeremy Smerd wrote, tivity to history, we should be cele- “Aurora [Capital Associates] should be brating a project like this. credited with thinking about how to JERI GREEN

10 | CRAIN’S NEW YORK BUSINESS | MARCH 14, 2016 AGENDA THE LIST NY AREA’S LARGEST MINORITY-OWNED COMPANIES Ranked by 2015 revenue

! "

#$%& '&()#*(+,-./ +& +& !YPBT 0 3BTaGBD`aXFX 5BHF!bFTaFBTE YPHSBVRBY`PDYHXUaV&DUS #IBPXSBTDIPFG UGhFdPCRF 7DIaeRFX!bFTaF FdFDa`PbF VBDQBHPTH 2eTEIaXY`40 SB`FXPBR 5XFYPEFT`DIPFG UVFXB`PTHUGgDFX

&''&0#.% 1.#)2 +& +& (PYVBTPD92B`PTU 5XPbB`FFWaPè &,)34,( VBRRBEPaSFWaPè&DUS 0 7PdÌ!bF& #IBPXSBTDIPFG 4FcAUXQ4A FdFDa`PbF

+-2& --0(3*5 +& +& (PYVBTPD92B`PTU &UUE #UaTè6UBE HUeB&DUS 5XFYPEFT` 0 SBTaGBDàXPTH 0FXYFe#Pè40 SBXQF`PTHBTE EPY`XPCa`PUT

,)4*637-,%&)#-3 +& +& !YPBT 0 )8BTETUT )8 2()4%( BX`FDIPTGU&DUS #U GUaTEFXDIPFG Y`BGG 3`&1FSCRF!bF& FdFDa`PbF BaHSFT`B`PUT 3UXXPY`UcT40 YFXbPDFY

&,)'4)) &#,23*5 +& +& (PYVBTPD92B`PTU $BPXeBTEGUUE `I7`& CBX`RF``Te&DUS 5XFYPEFT` 0 EPY`XPCa`PUT 0BSBPDB4A

&7&24))48 +& +& !YPBT 0 @USFTfY 49 -,: RBGBeF``FTe&DUS 5XFYPEFT`DIPFG BVVBXFR 2BGBeF``F7`& FdFDa`PbF cIURFYBRFX 4FcAUXQ4A

! +& +& !YPBT 0 #UTY`XaD`PUT @BRR7`& IBQY&TF` #IBPXSBTDIPFG SBTBHFSFT` 4FcAUXQ4A FdFDa`PbF FTHPTFFXPTH BXDIP`FD`aXF 5XFYPEFT` YaXbFeSB`FXPBR `FY`PTHBTE #IPFGgTBTDPBR YVFDPBR UGgDFX PTYVFD`PUT YFXbPDFY

-30&' #(),#;.)-,( " # +& +& (PYVBTPD92B`PTU 7VFDPBR`e 3*5 i 5XFYPEFT` 0 cIURFYBRFGUUE $aVUT`7`& BTEEPY`XPCa`PUT "XUTd4A

&#)4<+,-./-7-(5 ! $ ! % +& +& !YPBT 0 @BXFIUaYF @&Ì7`& cBP`Fd&DUS #IBPXSBTDIPFG EPY`XPCaÙX 4FcAUXQ4A FdFDa`PbF BVVBXFR SBTaGBDàXFX BTEcIURFYBRFX

,2()&'#30-9= --, " +& +& !YPBT 0 3BTaGBD`aXFXUG 2()4%()05 DXeY`BRcPTEUcY&DUS #IPFGFdFDa`PbF cPTEUcYEUUXY @IP`FY`UTF BTEGFTFY`XB`PUT %dVXFYYcBe YeY`FSY &RaYIPTH4A

2 4(#$3 & ' % +& +& !YPBT 0 @USFTfY "XUBEcBe CeEFYPHTRRD&DUS 5XFYPEFT`DIPFG BVVBXFR 4FcAUXQ4A FdFDa`PbF cIURFYBRFX

+-'043,.() % $ ! $ +& +& "RBDQ9!GXPDBT 3BTaGBDàXFX &,#;;4&3&:4,2= HUREFTQXaY`CBQFXe&DUS 5XFYPEFT`DIPFG !SFXPDBT 0 BTEEPY`XPCaÙXUG +,#'' FdFDa`PbF #BXPCCFBT YèRF 5BXQ!bF& GUUEVXUEaD`Y "XUTd4A

+,-./ ($ +& +& (PYVBTPD92B`PTU 'FTFXBR @&`I7`& SCPTe&DUS " ) * 0 DUT`XBD`PTHBTE 4FcAUXQ4A DUTY`XaD`PUT 5XFYPEFT`DIPFG SBTBHFSFT` FdFDa`PbF

#,#3& #,4 ,-)4*)#-3 ' # +& +& (PYVBTPD92B`PTU )TY`BRRB`PUT -,/5 YPXPTBgXF&DUS #IPFGFdFDa`PbF 0 UGCaPREPTH (FXXPDQY6UBE gXF VXU`FD`PUT 'BXEFT#P`e5BXQ4A YeY`FSY

2()4% ' +& +& !YPBT 0 #UTY`XaD`PUT ((-*#&)4( BDYYeY`FS&DUS 5XFYPEFT` (9!# @FY`2PTDURT!bF& 3`&9FXTUT4A

" + ,$ - . ! ! " !# $ # ! % " " $! " & "$ $ # ! "$ ' ( ' "$ " # $! # ' )*+ " %" " # # " , - % # "$ .! $" $ / #-0&0" 1! # 0 $ 23 $-4 1$ , 5 6 . " # 0" 7 $ 23 0 1! 8 0 5% 7 ! 7 # 2 7 " $$ # "$ $ 8 . 9* $ 6! % ! # " $ 6 # "# *&8&"::&":'!: : :. :9* ;&" + " 9&8 :: :,:9* :6 /:<:"

MARCH 14, 2016 | CRAIN’S NEW YORK BUSINESS | 11 REAL ESTATE | CRACKS IN THE MARKET Comeuppance

Developers thought New York’s luxury condo market would just keep rising. Now they have to think again. BY DANIEL GEIGER

LAST OF THE GIANTS? Harry Macklowe built 432 Park Ave. It may be the last of its kind for now.

ew York City’s real estate mar- HIGH-END CONDOS ARE “Foreign buyers are facing some headwinds,” ket is showing telltale signs of wrote NAR economist Scholastica Cororaton last slowing after an extraordinary NOT BEING SOLD AT week, noting that from April 2014 through March three-year run that saw aver- THE SAME RATE AS THEY 2015, they spent $102 billion on homes in the U.S., age office rents in Manhattan with Chinese buyers leading the pack. jump by 20%—from just under WERE TWO YEARS “High-end condos are not being sold at the N$60 per square foot to more AGO, WHEN WE WERE same rate as they were two years ago, when we than $70—and the median were going through a sales boom,” said Jonathan home price in the borough climb to a record-high GOING THROUGH A Miller, CEO of real estate appraisal and data firm $1.15 million from $800,000. Miller Samuel. “We’re starting to see developers The pessimism centers on residential develop- SALES BOOM negotiate on price and the market [begin to] tran- ment sites amid concerns the city is overstuffed sition where it’s no longer a frantic selling envi- with high-end apartments. ronment for new development.” Among the recent string of sobering reports is a reflection of the growing weakness in the city’s Besides the falling sales projections and taper- news that a 10-story building in Brooklyn high-end residential market. Developers had been ing interest among foreign buyers, developers Heights—one of three large properties being sold willing to pay record sums for land as long as the must also worry whether they’ll be able to secure by the Jehovah’s Witnesses there and in Dumbo— apartments they built could fetch unprecedented the loans to begin construction, as banks become will fetch a price 25% below the $300 million or sums. The payoff is no longer the same, according leery of high-end residential development. more for which it was initially projected to sell. The to the brokerage Corcoran Group, which reported Developers Joseph Beninati (see story, Page 14) parcels are considered prime places for both resi- that the average sale price for a luxury apartment and Bruce Eichner are both facing foreclosure in dential and commercial development. fell from $8.1 million in the fourth quarter of 2014 Manhattan after failing to lock up the loans need- Brokers said the decrease mirrors a precipitous to $6.9 million at the end of 2015, a 15% decline. ed to begin building. As many as 20 other sites may drop in the value of land sites in the city by 20% to The rise of the dollar against currencies of coun- be unable to secure construction financing, and 25% so far in 2016. These brokers declined to speak tries whose citizens have been stashing their may stall and face foreclosure, predicted Dennis on the record because several are marketing such wealth in New York real estate has also hurt the Russo, who leads the real estate practice at law firm properties and don’t want to openly disparage the market, according to a report released last week by BakerHostetler in New York. products they are trying to sell. the National Association of Realtors. In 2013, Eichner bought a long-vacant develop- Tumbling land values, which had reached Brazil, China and Russia have been particularly ment site on the corner of East 125th Street and

BUCK ENNIS $1,000 or more per square foot for prime sites, are hard hit by the stronger dollar. Park Avenue for $66 million. He planned to build a

12 | CRAIN’S NEW YORK BUSINESS | MARCH 14, 2016 Knakal added. such expensive apartments. Builders Harry Cushman & Wakefield projects that 175 to 200 Macklowe and CIM Group recently decided to cut development sites citywide will be sold in the in half the full-floor units on floors 91 to 95 of the first quarter of 2016—as much as 37% fewer than 96-story superluxury condo spire that is nearly in the first quarter of last year, which was a complete at 432 Park Ave. record quarter for sales. Brooklyn’s soaring market for residential Although there has been little definitive data to development sites has also been thrown off this show that the high-end residential market is tank- year, though the culprit is not a market glut or the ing, there is growing evidence that the direction of global economy, but the failure of the real estate prices and the pace of sales are pointing downward. and construction industries to reach a deal to extend a tax break. Builders change strategies The expiration of the 421-a tax-abatement pro- In its quarterly earnings call in February, gram this year has thrust the land market into a Vornado Realty Trust declined to disclose recent precipitous decline. Ofer Cohen, founder and sales figures at a superluxury tower it is building principal of Brooklyn-focused commercial bro- along Billionaire’s Row at 220 Central Park South. kerage firm TerraCRG, estimated that land sales The omission stoked speculation that sales, after would drop by 70% this year. starting strongly, have fallen off in recent months. Developers viewed the tax break as essential to Developer Gary Barnett has been unable to sell a their bottom lines when building rental housing, block of 38 rental apartments at One57, the high- Cohen said, and few if any development sites have end condo tower he built on Billionaire’s Row. traded hands since it expired. The abatement ONE57: Gary Barnett has Barnett also has slashed prices at a condo tower offered developers a break on their real estate taxes been unable to move 38 he’s building on the Lower East Side, cutting his if they included affordable units in their projects. units in this Billionaire’s projection for the total value of the apartments by “Around 80% to 90% of the market for devel- Row tower. about $200 million, to almost $1.9 billion. opment sites was for rental-housing construc- Kevin Maloney, the developer of a luxury tion,” Cohen said. “The only rental development condo building at 10 Sullivan St., is carving the 17- sites that are trading now are those that already story building’s three-level, $45 million pent- qualified for 421-a because they got their founda- house into two units more modestly priced tions poured. And there’s not that many of those because of a dearth of buyers actively looking for on the market.” Ⅲ ARRESTED DEVELOPMENT 330-foot-tall, 670-unit rental apartment tower STALLED: there. Eichner, who has a history of defaulting Bruce Eichner hoped to build luxury apartments on an East Harlem lot across from Metro- when the economy turns, received a loan from North’s Harlem-125th Street station (top photo). Now he’s trying to sell the land. The Jehovah’s Witnesses are struggling to sell parts of their former Brooklyn headquarters, including these buildings in Garrison Investment Group to buy the site but Brooklyn Heights (lower photo) as demand wanes for luxury development sites. couldn’t secure construction financing to begin the project. The Durst Organization, a large New York City landlord, purchased the debt from Garrison and is now moving to foreclose after Eichner defaulted on the loan earlier this year. To extricate himself from the financial jam, Eichner in recent months has tried to sell the project for an asking price of about $150 million. The growing talk of falling prices and foreclo- sures stands in stark comparison to the FAST FALL bullish mood of the market even just a year ago, when developers were see- 37% ing a nearly 18% year- over-year gain in the POTENTIAL DROP in devel- average price per opment site sales in the square foot among first quarter of 2016 versus new developments. the same period last year “Until the middle of last year, no one was fearful, but today a higher percentage of $6.9M people are,” said Bob Knakal, Cushman & MEDIAN PRICE of a luxury Wakefield’s chair- condo, down 15% from last man of New York year investment sales. “Markets are psycho- logical, and as the fear builds you get a herd 15% mentality that comes into effect. DROP in average sale price “It’s harder to get for a luxury apartment deals done—buyers from the fourth quarter of and lenders are being 2014 to the end of 2015 more cautious, and Sources: Cushman & Wakefield, it’s harder to get Corcoran COSTAR, PROPERTY SHARK.COM, BLOOMBERGNEWS equity together,”

MARCH 14, 2016 | CRAIN’S NEW YORK BUSINESS | 13 REAL ESTATE| BENINATI’S GAMBLE HIGH RISK PLAY

Joe Beninati wanted to be a New York superbuilder. Now he’s on the brink of losing it all. What went wrong? BY DANIEL GEIGER and JOE ANUTA

oe Beninati was a little-known developer with a mixed track record in Connecticut when he bought three small apartment buildings last year on East 58th Street with a big idea: Plant a 113-unit, 950-foot lux- Jury apartment tower designed by high- profile architecture firm Foster + Partners in the heart of the well-heeled enclave of Sutton Place. For Beninati, it was an opportunity to vault from relative obscurity into the ranks of the city’s most illustrious builders, and he was willing to take enormous risks to get there. “How many times in your life do you get to build a 1,000-foot-tall building in Manhattan?” Beninati said. “You might get up to bat twice in your whole life for something like this. There are guys who go 20 years and have major-league careers and never get up to bat in the World Series. It just doesn’t work out.” To do the deal, Beninati signed what many in the industry viewed as a Faustian bargain. He bor- rowed $147.25 million at what amounted to a 30% interest rate from Gamma Real Estate, a lender whose founder has a long and litigious track record in the city’s real estate industry. JOE BENINATI: The Bronx-born By January, Beninati was in default on the debt. developer risked it all on a In a last-ditch effort to prevent Gamma from seiz- Sutton Place luxury tower. ing the property in a foreclosure auction, he declared bankruptcy last month for BH Sutton Mezz LLC, a corporate shell he controlled that received a portion of Gamma’s loan. Beninati wouldn’t comment on the bankruptcy case. The ensuing legal battle will likely last months. It threatens to swamp Beninati financially and ruin his ability to ever do deals in the city again. “There’s definitely reputational risk in declaring its established wealth. took on the project alone. bankruptcy,” said Robert Ivanhoe, who leads the Pulling off such a project would be an unprece- Instead, he invested only about $5 million cash New York real estate practice at law firm Greenberg dented accomplishment for a newbie developer into the project and arranged to receive the rest Traurig. “He has had issues in his past, and now this and put him at the level of some of the city’s most from Gamma, a firm run by N. Richard Kalikow and comes on top of that. It may hurt him in the future skilled builders such as Gary Barnett, the his son Jonathan. Beninati used the funds to if he’s trying to get a loan from a bank.” Zeckendorfs and Harry Macklowe, company that finance the purchase of the three buildings, then What turned into an imbroglio started with Beninati was determined to join. spent tens of millions more on 144,212 square feet promise. In January 2015, Beninati bought three Ego and perhaps a healthy dollop of greed led of air rights to let the tower soar nearly 1,000 feet. contiguous, six-story buildings at 428, 430 and 432 Beninati to make key early mistakes. He rejected Further millions were spent paying 22 rent- E. 58th St. for $32 million, and hatched plans to offers from top builders including high-end real regulated tenants to vacate, along with design and raze them and erect a 67-story tower in their place. estate development firm DDG and Los Angeles- redevelopment costs. Altogether, Beninati with- While supertall towers were being planned and based investment fund CIM Group to partner in drew more than $120 million from Gamma’s built nearby on Billionaires’ Row, Beninati’s tower building the spire. Beninati projected hundreds of $147.25 million loan. would combine height and über-luxury with millions of dollars of profits from selling the 113 People familiar with the situation say the finan- something none of those other projects had: the condo apartments he planned to create in the cial structure was combustible from the start.

PETER D’AMATO PETER D’AMATO cachet of Sutton Place, a neighborhood known for tower, money that he wouldn’t have to split if he Unlike the last boom—when buying property for

14 | CRAIN’S NEW YORK BUSINESS | MARCH 14, 2016 huge sums using vast debt was commonplace— and 82 acres of waterfront property for an office declared bankruptcy on the project to try to escape loans like Gamma’s are now much harder to find, park called Harbor Point, which was completed by him. In 2002, Kalikow pressured an investment as cautious lenders rarely extend to developers another developer. Antares’ successes included a partner, Adam Hochfelder, to buy him out for $35 more than 70% of a project’s costs. Several peo- suburban office property it bought in the early million. To pay back the debts he incurred to buy out ple who have worked with Kalikow in the past say 2000s called Pickwick Plaza. Kalikow, Hochfelder later committed fraud and was that by allowing Beninati to take on such a heavy In 2013, Beninati formed Bauhouse Group, the sentenced to prison time. Kalikow owns the large debt load, his true aim may have firm through which he took on office building at 101 Park Ave. and during his career been to take control of the project. the Sutton Place spire, with has controlled several trophy office buildings in They cite the loan’s $45 million Christopher Jones and Daniel Lee, Manhattan. “exit fee,” mentioned in court doc- former executives at Jones Lang “His competitors might call him ruthless,” said uments, which pushed the loan’s LaSalle and LaSalle Investment residential broker Dolly Lenz, who worked with effective interest rate to 30%. Management. Its first purchase was Kalikow at Manhattan House. “But he knows how “Kalikow knew the exact price a former warehouse along the High to slice and dice a deal … and some people call that at which he wanted to own the site Line it planned to convert to a 13- business.” and lent to that amount,” said one unit condo designed by Soo K. Chan. As he battles Kalikow’s takeover efforts in person who has worked with him Six months after its targeted fall court, Beninati has apparently swallowed some of in the past but asked not to be 2015 completion date, the project is his pride and begun marketing the project to named. far from finished, and a $35 million potential partners. Marketing materials value Kalikow and his representatives acquisition loan is set to mature at the planned tower at about $260 million, well in did not return messages and phone the end of this year. excess of its debts. calls seeking comment. Other lawsuits could also stymie Beninati’s Within months of completing BENINATI MAKES A DEAL efforts to regain control and take a seat in New the financing, Beninati’s supertall But Beninati may have met his York’s real estate power circle. Broker Nathaniel dream began facing harsh new match in N. Richard Kalikow, a Christian is suing Bauhouse Group, claiming he realities. First, the market for grandson of New York real estate never received commissions for arranging an air- high-end condos began to soften. pioneer Joseph Kalikow and a cousin rights sale. Commercial brokerage JLL is suing, Then, midway through last year, of developer Peter Kalikow. Richard alleging its brokers were never paid for securing Beninati announced a $45 million is a real estate veteran known for his the loan with Gamma. deal to purchase a neighboring dustups with partners—most of The most daunting challenge of all could sim- apartment building at 434-436 E. which have ended profitably for him. ply be the project’s timing—a factor that has 58th St., which fell apart when an After a public spat with his partner in sunk even veteran builders. If New York is past elderly tenant refused to be the $1 billion-plus conversion of the peak of the luxury market, neither Beninati bought out of his lease. The build- Upper East Side rental property nor Kalikow may find buyers for the Sutton Place ing would have roughly doubled Manhattan House, Kalikow was tower’s multimillion-dollar apartments. In that the size of the footprint on which bought out on favorable terms. case, Beninati would end up as just one more the Sutton Place tower could have SUTTON PLACE TOWER: The In 2008, he attempted to foreclose victim of New York’s boom-and-bust real estate been built. Beninati wound up Norman Foster-designed spire on a Brooklyn developer who also cycle. Ⅲ buying up $11 million of air rights has yet to be built. from the building. Afterward, the co-op board accused him of misleading them into thinking he was raising only a modest 13-story building. As news of the outsize tower spread, community opposition to the project grew in the normally sleepy neighborhood. An area group drafted a zoning proposal to limit new buildings to 25 sto- ries. The episode demonstrated Beninati’s greatest strength: his indefatigable power of persuasion. “Joe was a very charming man,” said Elias Schwartz, an attorney who represented the East 58th Street co-op’s board in negotiations to sell the building and its air rights to Beninati. “He’s the kind of guy you would want to have a drink with and who could tell a good story.” Even though 434-436 E. 58th St.’s residents had seemed put off by Beninati’s plans, Schwartz said that the developer’s charisma had persuad- ed them to rekindle the deal as recently as the beginning of the year, just before Beninati slipped into default at the site. A onetime financial executive, the Bronx-born Beninati moved into real estate in and around Greenwich, Conn., attracting such blue-chip investors as Goldman Sachs and private-equity firm Lubert-Adler to his deals. In 2004, his firm Antares Investment Partners spent $38 million to buy 26 acres of Greenwich back-country property to build mansions. When the residential market began to tank in 2007, LET US PLAN only two of the houses had been sold, and the vacant lots and a partially built mansion called Lake Carrington were liquidated to pay off YOUR NEXT PARTY Antares’ $26 million loan, which was in default. Employee Owned The firm also lost a Stamford office building called 100 West Putnam to creditors, and spent CONTACT LAUREN PAGANO AT [email protected] OR 212-582-2057 more than $400 million on commercial buildings

MARCH 14, 2016 | CRAIN’S NEW YORK BUSINESS | 15 TO PLACE A CLASSIFIED AD, CALL 1 800 444 6007 OR VISIT CRAINSNEWYORK.COM

BUSINESS OPPORTUNITIES PUBLIC AND LEGAL NOTICES 1RWLFHRI4XDOLÀFDWLRQRI675$7(*,& 1RWLFHRI)RUPDWLRQRI021,725 ACCOUNTING AND AUDITING SERVICES REQUEST FOR PROPOSALS 3$571(562))6+25()81'9,,/3 675((72:1(5//&$UWVRI2UJÀOHG $SSOIRU$XWKÀOHGZLWK6HF\RI6WDWH ZLWK6HF\RI6WDWHRI1< 661< RQ The New York City Educational Construction Fund (“ECF”) is seeking proposals RI1< 661< RQ2IÀFH 2IÀFHORFDWLRQ1<&RXQW\ from organizations that are capable of providing accounting and auditing servic- ORFDWLRQ1<&RXQW\/3IRUPHGLQ&D\ 661Broadway, Ste. 1010, NY, tect,/engineer or closely rel role. Exp must incl [email protected] BI solutions leadership, BO data migrations, BI NY 10018. Purpose: any lawful activity. dashboarding & visualization tools, proficiency EMERGENCY across Agile SDLC w/ BO & MS SQL Server, BI & COMMUNICATIONS Notice of Formation of Quik Park 150 Data Warehousing best practices, concepts & SYSTEMS Charles Street Garage LLC. Arts. of Notice of Qualification of MCP SECURI- SDLC. Mail resumes to Equinox Fitness-Attn: IT SPECIALISTS Org. filed with Secy. of State of NY TIES LLC Appl. for Auth. filed with Secy. Recruiting, 895 Broadway, NY, NY 10003. s&2%%0)#+50$%,)6%29 (SSNY) on 2/19/16. Office location: NY of State of NY (SSNY) on 02/02/16. s(/52452.!2/5.$ County. SSNY designated as agent of Office location: NY County. LLC formed /.2%0!)23 LLC upon whom process against it may in Delaware (DE) on 12/11/09. Princ. Portfolio Execution Manager: Dsgn s&2%%%.'2!6).' be served. SSNY shall mail process to: office of LLC: Attn: Ridgely Donohue, algrthms fr optmz exctn of stcks in c/o Icon Parking Systems, 270 s3(/24,/.'4%2- 777 Third Ave., 25th Fl., NY, NY 10017. US/Erpe/Asia, Crt & Implmnt prdctn qual- 2%.4!,3 Madison Avenue, 2nd Fl., NY, NY SSNY designated as agent of LLC upon ty executn algrthms in trdng syst; Mntn 10016. Purpose: any lawful activity. whom process against it may be uptodate undrstndng of exchng ruls & served. SSNY shall mail process to the regultn & impct on executn algrthms; LLC at the addr. of its princ. office. DE Optmly blnce rsk/rwrd w/ algrthm exe- 1RWLFHRI4XDOLÀFDWLRQRI6+,30$1 addr. of LLC: Corp. Trust Center, 1209 cutn schedl; Incorp shrt trm prdctve sgnls *22':,1//31RWLFHRI5HJÀOHG Orange St., Wilmington, DE 19801. into executn algrthms; Dvlp rsrch agnda ZLWK6HF\RI6WDWHRI1< 661< RQ Cert. of Form. filed with DE Secy. of for shrt trm predctve sgnls, collab w/ 2IÀFHORFDWLRQ1<&RXQW\ State, John G. Townsend Bldg., 401 rsrchrs/trdrs; Prvd cont fdbck to trdng PUBLIC AND LEGAL NOTICES //3IRUPHGLQ&RQQHFWLFXW &7 RQ Federal St., Ste. 4, Dover, DE 19901. systm dvlprs. Req: BS in Physcs, Mth, CS, 3ULQFRIÀFHRI//3 Purpose: Any lawful activity. or Eng, w/ 5 yrs exp. Skls: hnds-on-exp 3DUN$YHWK)O1<1<661< executn algorithm dvlpmnt; exp w/ trdng 1RWLFHRI4XDOLÀFDWLRQRI675$7(*,& GHVLJQDWHGDVDJHQWRI//3XSRQZKRP glbl eqty mrkts; undstng stck exchng rls & 3$571(56)81'62/87,216$6 SURFHVVDJDLQVWLWPD\EHVHUYHG661< NOTICE OF QUALIFICATION OF Trifera, regs; exp w/ trnsctn cst anlys mthdlgs; 62&,$7(69,,/3$SSOIRU$XWKÀOHG VKDOOPDLOSURFHVVWRWKH//3$WWQ$ODQ LLC. Application for Authority filed with incldng ststcl tchnqs such as linear ZLWK6HF\RI6WDWHRI1< 661< (/LHEHUPDQ2QH&RQVWLWXWLRQ3OD]D the Secretary of State of NY (SSNY) on regrssn, prncpl cmpnts anylss, rsk fctr RQ2IÀFHORFDWLRQ1< +DUWIRUG&73XUSRVH$Q\ 07/06/2015. Office location: New York dcmpstn & stat hypthss tstng. 40 hrs/wk; &RXQW\/3IRUPHGLQ'HODZDUH '( RQ ODZIXODFWLYLW\ County. LLC formed in DE on 661

16 | CRAIN’S NEW YORK BUSINESS | MARCH 14, 2016 TO PLACE A CLASSIFIED AD, CALL 1800 444 6007 OR VISIT CRAINSNEWYORK.COM PUBLIC AND LEGAL NOTICES

1RWLFHRI)RUPDWLRQRI./DP%URDGZD\ Notice of Qualification of BioMed NOTICE OF FORMATION OF LOROD LLC. Formation of K & M Associates CRE, LLC Realty LLC. Authority filed with NY Articles of Organization filed with the filed with the Secy. of State of New York //&$UWVRI2UJÀOHGZLWK6HF\RI Dept. of State on 1/19/16. NYS ficti- Secretary of State of NY (SSNY) on (SSNY) on 12/28/15. Office loc.: New 6WDWHRI1< 661< RQ2IÀFH tious name: BioMed Realty New 01/21/2016. Office location: NEW York County. SSNY designated as agent ORFDWLRQ1<&RXQW\661

MARCH 14, 2016 | CRAIN’S NEW YORK BUSINESS | 17 TO PLACE A CLASSIFIED AD, CALL 1800 444 6007 OR VISIT CRAINSNEWYORK.COM PUBLIC AND LEGAL NOTICES

1RWLFHRI4XDOLÀFDWLRQRI%522.),(/' 1RWLFHRI4XDOLÀFDWLRQRI%522.),(/' 1RWLFHRI4XDOLÀFDWLRQRI/&1&DSLWDO 1RWLFHRI4XDOLÀFDWLRQRI%522.),(/' 675$7(*,&5($/(67$7(3$571(56,,& 675$7(*,&5($/(67$7(3$571(56 0DQDJHPHQW/3$XWKRULW\ÀOHGZLWK 675$7(*,&5($/(67$7(3$571(56,,$ (5 /3$SSOIRU$XWKÀOHGZLWK6HF\ ,,&/3$SSOIRU$XWKÀOHGZLWK6HF\ 1<'HSWRI6WDWHRQ$V (5 /3$SSOIRU$XWKÀOHGZLWK6HF\ RI6WDWHRI1< 661< RQ RI6WDWHRI1< 661< RQ VXPHGQDPHLQ1<6WDWH/&1&DSLWDO RI6WDWHRI1< 661< RQ 2IÀFHORFDWLRQ1<&RXQW\/3IRUPHG 2IÀFHORFDWLRQ1<&RXQW\/3IRUPHG 3DUWQHUV2IÀFHORFDWLRQ1<&RXQW\ 2IÀFHORFDWLRQ1<&RXQW\/3IRUPHG LQ'HODZDUH '( RQ661< LQ'HODZDUH '( RQ661< /3IRUPHGLQ'(RQ1<6HF LQ'HODZDUH '( RQ661< GHVLJQDWHGDVDJHQWRI/3XSRQZKRP GHVLJQDWHGDVDJHQWRI/3XSRQZKRP RI6WDWHGHVLJQDWHGDJHQWRI/3XSRQ GHVLJQDWHGDVDJHQWRI/3XSRQZKRP SURFHVVDJDLQVWLWPD\EHVHUYHG SURFHVVDJDLQVWLWPD\EHVHUYHG661< ZKRPSURFHVVDJDLQVWLWPD\EHVHUYHG SURFHVVDJDLQVWLWPD\EHVHUYHG 661

18 | CRAIN’S NEW YORK BUSINESS | MARCH 14, 2016 GOTHAM GIGS

MAX-IMIZING PROFIT: Zanan teaches car dealerships how to sell services that have far higher margins than the vehicles themselves.

Moving more than just metal By mastering the art of selling extras for vehicles,Max Zanan has carved out a lucrative career MAX ZANAN ax Zanan came to Brooklyn as a teenager in people up to $300,000 a year, making it an ideal the waning days of the U.S.S.R. His parents career for immigrants with limited opportunities but AGE 39 Mwanted him to become a doctor or lawyer, a burning drive to succeed. BORN Moscow but after driving a cab while listening incessantly to “The best salesman I ever had was a guy I met who RESIDES Manhattan Howard Stern, he landed a job selling cars was working at a bodega,” Zanan said at a Volkswagen dealership in It’s easier to over a recent lunch of $50 sirloin and a EDUCATION B.A. and M.P.S. from “ John Jay College of Criminal Justice Manhattan. He proved so adept at per- hack into a bottle of Rioja. suading people to drive off in the latest In flush times such as these, when LEARNING CURVE Zanan’s family Passat that he eventually became general car dealer’s Cadillac Escalades are flying off the lots, immigrated to America in 1992, manager at a local Mitsubishi showroom. computers dealers tend to let their guard down. So shortly after the collapse of the “I’m proof that anyone can learn to than a bank’s. Zanan has launched a service to safeguard Soviet Union. His father, a journalist, become a salesman,” Zanan said. their computer networks from crooks. had arrived earlier. He graduated Today, he runs a $7-million-a-year That’s no These networks contain a lot of sensitive from Fort Hamilton High School in consulting firm advising car dealers how secret ” financial information that customers Bay Ridge. “I came here not knowing to sell more insurance, warranties and hand over to get an auto loan. “It’s easier English and I was a teenager, so it loans—the extras that generate most of a dealer’s to hack into a car dealer’s computers than a bank’s,” was hard at first,” Zanan said. profits. Salespeople adept at moving metal are often said Zanan. “That’s no secret to anybody.” BEHIND THE WHEEL Zanan is unsophisticated when it comes to arranging financ- Zanan’s advice for car buyers? Do your homework driving his third Jeep Grand Cherokee. ing. At best, most dealers break even selling cars and online and head into the lot with a good idea of the car’s He can’t bring himself to pay for a make money on other services. Profit margins on price. Don’t fight over every last nickel, and odds are BMW or Mercedes. “We’re talking repairs can be as high as 75%. “When was the last the dealer will accommodate you when the car needs about something that takes you from time you negotiated over the cost of labor?” he asked. repairs or is ready to be traded in. “Everyone thinks Point A to Point B,” he said. “That’s it.” — AARON ELSTEIN

BUCK ENNIS Mastering the art of the extra can earn car sales- someone else got a great deal,” he said.

MARCH 14, 2016 | CRAIN’S NEW YORK BUSINESS | 19 EXECUTIVE MOVES

clothing retailer as chief of New York operations. Lendlease: Ralph Esposito, Marcus & Millichap: John JLL financial officer. He was Answer the 54, was promoted to head Crafton, 38, joined the real formerly chief financial Call: of East Coast construction estate firm as investment PETER RIGUARDI, 54, officer at ModCloth. Lauren operations at the real sales broker. He was for- was promoted to chair- Garden City Group: Stephen Profeta, 32, estate management merly senior broker at man of the real estate Cirami, 43, was promoted was pro- company. He was previ- Besen & Associates. firm’s New York to chief operating officer at moted to ously executive general Patterson Belknap Webb & tristate region. He was the legal services compa- director of manager. Tyler: Jason Polevoy, 43, previously president of ny. He continues as execu- development at the non- Rosenthal & Rosenthal: joined the law firm as the New York tristate tive vice president. profit, which serves the Michael Wenger, 45, was counsel. He was formerly region. Kenneth Cutshaw, 62, families of fallen police- promoted to general counsel at Kleinber Kaplan joined as interim president men and firefighters. She counsel at the finance Wolff & Cohen. and chief executive. He was previously deputy company. He was previ- Hogan Lovells: Mark Eagan, was formerly chairman director of development. ously deputy general 55, joined the law firm as Goodwill The New York Times. and CEO at GNG. Dewberry: Anthony Alduino, counsel. head of its U.S. real estate New Hub International Ltd.: Ross Scott Nader, 45, joined as 47, joined the engineering- Kliment practice. He was previous- York/New Albert, 31, joined the executive vice president and professional-services Halsband ly a partner at Paul Jersey: Katy insurance brokerage as and general counsel. He firm as senior project man- Architects: Hastings. Gaul-Stigge, assistant vice president of was formerly vice president ager and mechanical engi- Michael William Regan, 42, joined 42, joined organizational resilience and chief counsel for the neer. He was formerly asso- Maza, 39, the law firm as a partner. the non- and security-risk manage- Americas at Crawford & Co. ciate and chief mechanical was pro- He was previously a part- profit as president and ment specialist. He was Greeley engineer at IP Group moted to ner at Katten Munchin CEO. She was formerly previously anti-money- and Consulting Engineers. partner. He was previously Rosenman. executive director at the laundering analyst at K2 Hansen: Alex Melgar, 53, joined as a an associate. — ERICA DAVIES New York City Mayor’s intelligence. Sundaram senior project manager. He David Whitehill, 37, was Office of Workforce Hub International Solai, 50, was formerly an associate promoted to partner. He Development. Northeast: Steven Guthart, was pro- at WSP at Parsons was previously an associate. EXECUTIVE PROMOTIONS Digital Prism Advisors: 58, Leslie E. Robertson was promoted to presi- moted to Brinckerhoff. To get your announcement Jonathan Murray, 52, joined dent of the insurance bro- principal and managing Workwell Partners: Kristine Associates: Matthew into Crain’s, please submit the digital transformation kerage’s Brooklyn opera- director of the U.S. Scotto, 28, was promoted to Melrose, 36, was promoted it online. Fill out the form at consultancy as executive tions. He was previously Northeast Operating director of strategic plan- to associate partner at the CrainsNewYork.com/ vice president and chief senior vice president. Group at the engineering ning at the office furniture architectural consulting execmoves. The Executive technology officer. He was Bonobos: Antonio Nieves, services company. He was company. She was previ- firm. He was previously Moves column is also avail- formerly interim CTO at 35, joined the online previously office director ously marketing manager. senior associate. able online.

Heritage Healthcare Innovation Awards 2016

NOMINATIONS NOW OPEN!

Heritage Provider Network honors innovative AWARD CATEGORIES New York metropolitan area healthcare leaders with the ﬁ rst annual Heritage Healthcare Innovation Awards. Heritage Innovation in JUDGING PANEL Healthcare Delivery Award

Stephen Berger Dr. Freda Lewis-Hall Chairman, Odyssey Partners Chief Medical Offi cer of Pfi zer Heritage Technology Jo Ivey Boufford, MD Dr. Richard Merkin Innovator in Healthcare President, The New York Academy of Medicine President and CEO, Heritage Provider Network Award Deborah Estrin Mary O’Neil Mundinger DrPh Professor, Computer Science, Cornell Tech and Edward M. Kennedy Professor of Health Policy, Healthcare Policy and Research, WCMC Dean Emeritus Columbia University School of Nursing Heritage Research Dr. Linda Fried Ram Raju, MD, MBA, FACS, FACHE Investigator in Translational Dean of the Mailman School of Public Health President and CEO at Medicine Award Senior Vice President, Columbia University Medical Center, New York City Health + Hospitals DeLamar Professor of Public Health Dennis Rivera Rosa M. Gil, DSW Co-founder and current Chair Heritage Healthcare President and CEO, Comunilife, Inc. of the Partnership for Quality Care (PQC) Leadership Award Dr. Rainu Kaushal, MD MPH Ellis Rubinstein Cornell, Chair, Healthcare Policy & Research President and Chief Executive Offi cer, Nanette Laitman Distinguished Professor The New York Academy of Sciences Heritage Healthcare Organizational Leadership Award

For more information, visit crainsnewyork.com/heritage Winners will be proﬁ led in NYC Awards Luncheon: May 16, 2016 Luncheon hosted by Dr. Richard Merkin, CEO of Heritage Partners Network, and Crain’s New York Business Mark Wagar, President of Heritage Medical Systems, former CEO of Empire BlueCross BlueShield

20 | CRAIN’S NEW YORK BUSINESS | MARCH 14, 2016 SNAPS

Advocates give students a leg up The Children’s Defense Fund-New York, an advocacy organization, held a Feb. 29 benefit that celebrated five local high-school students who were each awarded a $10,000 college scholarship from the nonprofit. The students were selected based on a variety of factors, including their grades, commitment to their communities and ability to overcome significant obstacles such as poverty, homelessness or abuse.

Director Spike Lee with wife LaTanya Richardson Jackson, actress and event Tonya Lewis Lee, Corcoran honoree, and Marian Wright Edelman, founder and Group broker Spencer president of the Children’s Defense Fund, at the fete, Means and actress Rosie which raised about $1 million. Perez at the Children’s Defense Fund gala at the Pierre Hotel. $1.2M raised to fight kids’ cancer Bringing in the green for the Botanical Garden

Gretchen and Larry Witt, founders of Cookies for Kids’ Cancer, at a Feb. 23 benefit for the organization, which raises funds to support cancer research.

Melissa Mark-Viverito, speaker of the New York City Council, Kevin Sharkey, executive editorial director of Martha Stewart Living, lifestyle impresario Martha Stewart and Gregory Long, chief executive and president of the New York Botanical Garden, at a Feb. 23 fundraiser for the Celebrity chef Bobby Flay and actor Paul Rudd at the garden’s orchid research. The event raised $600,000. Cookies for Kids’ Cancer event at Metropolitan West. The gala took in about $1.2 million.

HLAGRI/KRATPOO;SLANGBUYPTIKMMLA;BACMAGL PHAM MCMULLAN; BFA.COM/ANGELA THELMA GABOURY/PATRICK SYLVAIN GARCIA/SKARRATT PHOTOS; SEE MORE OF THIS WEEK’S SNAPS ONLINE AT CRAINSNEWYORK.COM/SNAPS. GET YOUR GALA IN SNAPS: EMAIL THERESA AGOVINO, [email protected]

MARCH 14, 2016 | CRAIN’S NEW YORK BUSINESS | 21 FOR THE RECORD*

smoothies found at its RETAIL MHP Real Estate Services, ground-floor space NEW IN TOWN other two locations, in the GOVERNMENT Chick-fil-A signed a was represented in-house in the four-story build- financial district and CONTRACT lease for 5,450 square feet by James Tamborlane, ing. The tenant was rep- Boro Café Chelsea. Dessert menu OPPORTUNITIES at 1180 Sixth Ave. The Brett Varricchio and resented by Eastern 38-28 27th St., Queens options include a gluten- chicken-sandwich pur- Garett Varricchio. The Consolidated’s Ravi The café opened in the free cupcake, an apple- CONSTRUCTION SERVICES veyor will occupy part of asking rent was $550 per Idnani. The landlord, ground floor of the new cider doughnut and an Department of the ground floor and a square foot. George Giallias, was rep- Boro Hotel in Long Island oat-date bar. Correction lower-level section of the resented by Eastern City. A breakfast and all- Seeks competitive sealed 22-story building. The Caffé Bene signed a 10- Consolidated’s James day menu created by chef bids by 11 a.m. on April 8 tenant was represented year lease for 1,000 Famularo, Alex Geisinger George Mandakas are both BANKRUPTCIES for roof replacement of the by RKF’s Greg Covey, square feet at 596 Third and Jeff Geoghegan. The available. Options include bakery/laundry building Jeremy Ezra and Richard Ave. The shop will occu- asking rent was $300 per a twist on croque mon- Alpha Diner Corp. at Rikers Island. Contact Gelber. The landlord, py the entire corner square foot. sieur served with maple 105-45 Crossbay Blvd., Jeanette Cheung at syrup, and a cocktail Queens (718) 546-0684 or called the Dutchkill, made Filed for Chapter 11 bank- jeanette.cheung@doc with spiced rum, cran- ruptcy on Feb. 19. The fil- .nyc.gov. DEALS ROUNDUP berry and Prosecco. ing cites estimated assets and liabilities of $0 to NYC Health + Hospitals TARGET/SELLERS TRANSACTION SIZE BUYERS/INVESTORS TRANSACTION TYPE [IN MILLIONS] Cardiff Giant $50,000. Seeks competitive sealed 415 Myrtle Ave., Brooklyn bids by 1:30 p.m. on April China Guangfa Bank Co./ $3,558.3 China Life Insurance Co. SB M&A The New York state- Alrose King David 1 for interior alterations Citigroup Inc. (Manhattan); (23.69%) themed bar will open in 30 E. 39th St. costing $700,000 to IBM Credit (Armonk, NY) Clinton Hill next month. Filed for Chapter 11 bank- $800,000 at the Roberto London City Airport Ltd./ $2,800.0 Alberta Investment Management FB M&A Named after a well-known ruptcy on March 4. The fil- Clemente Center, 540 E. Global Infrastructure Partners Corporation; Borealis Infrastructure 1860s hoax in Cardiff, ing cites estimated assets 13th St. Contact Janet (Manhattan); Highstar Capital Trust; OMERS Private Equity; Ontario N.Y., the bar will serve and liabilities of Olivera at (212) 442-3680 (Manhattan) Teachers’ Pension Plan; Wren House Infrastructure Management beer, cider, wine and spir- $10,000,001 to $50 million. or janet.olivera@ Limited its produced in the state. The creditor with the nychhc.org. largest unsecured claim is Carmike Cinemas Inc./ $1,201.4 AMC Entertainment Holdings Inc. SB M&A Gentilly Kitchen + Bar Joseph Maniscalco, owed GOODS AND SERVICES Manatuck Hill Partners; Mittleman Investment 64 Carmine St. $190,838. Department of Parks Management (Melville, L.I.) The restaurant-bar opened and Recreation in the West Village. Cars R Pluss Auto Seeks competitive sealed Pittsburgh Glass Works/ $635.0 LKQ Corp. SB M&A Highlights from the New Repair bids by 4 p.m. on April 4 Kohlberg & Co. (Mount Kisco, N.Y.); PPG Industries Inc. Orleans-inspired menu 2541A Tilden Ave., for complete mainte- include crawfish and corn Brooklyn nance, monitoring, Apollo Residential Mortgage Inc. $464.7 Apollo Commercial Real Estate SB M&A beignets, smoked cheddar Filed for Chapter 7 bank- inspection and repair of (Manhattan)/Pine River Capital Finance Inc. (Manhattan) grits, bacon-wrapped ruptcy on Feb. 29. The fil- the Randall’s Island con- Management trout almondine and fried ing cites estimated assets nector grade crossing. green tomato salad. of $0 to $50,000 and esti- Contact Christopher Miao API Technologies Corp./ $310.2 J.F. Lehman & Co. (Manhattan) FB M&A Harvey & Phyllis Sandler mated liabilities of at (212) 830-7983 or Foundation Inc., endowment arm; Suffolk Arms $1,000,001 to $10 million. christopher.miao@ Hoak & Co.; Palogic Value 269 E. Houston St. The creditors with the parks.nyc.gov. Management; Steel Excel Inc. (White Plains, N.Y.); Steel Partners The bar, an enterprise by largest unsecured claims (Manhattan); Vintage Capital former Dutch Kills and are JPMorgan Chase, owed Educational Management; Wynnefield Capital Inc., profit-sharing plan (Manhattan) Pegu Club mixologist $81,000, and the Internal Construction Fund Giuseppe Gonzalez, Revenue Service, owed Seeks requests for pro- MetLife Premier Client and $300.0 Massachusetts Mutual Life SB M&A opened on the Lower East $9,809.58. posals by noon on April 8 MetLife Securities Insurance Co. Side. The venue offers sig- from organizations that and certain assets associated nature cocktails with a JVJ Pharmacy Inc. d/b/a are capable of providing with MetLife Premier/ MetLife Inc. (Manhattan) menu consisting of University Chemists accounting and auditing American fare from Cuban 74 University Place services for the examina- 45 Rivington St. (Manhattan)/ $116.0 Adam America Real Estate Group; SB M&A chef Alex Garcia. Filed for Chapter 11 bank- tion of annual financial Allure Group Inc. (Brooklyn) Slate Property Group (Manhattan); ruptcy on March 3. The statements. Contact Vanke Holdings (USA) (Manhattan) filing cites estimated Helena Viteri at COMPANY MOVES Coherus Biosciences Inc./ $100.0 HealthCare Royalty Partners; GCI assets and liabilities of (718) 472-8287 or not disclosed KKR & Co. (Manhattan); $1,000,001 to $10 million. [email protected]. KMG Capital Partners; MX II Associates Sweaty Betty The creditors with the 1153 Madison Ave. largest unsecured claims SomaLogic Inc./ $60.5 Visium Asset Management (Manhattan) GCI not disclosed The British activewear are Lakeland Capital REAL ESTATE DEALS

brand opened its third city West, owed $608,170.64; Selected deals announced for the week ended March 3 involving companies in metro New York. SB M&A: location, on the Upper BioRidge, owed COMMERCIAL Strategic buyer M&A represents a minority or majority acquisition of existing shares of a company without East Side. As in its Flatiron $143,803.71; and Fagron, Mission Capital the participation of a financial buyer. FB M&A: Financial buyer M&A represents a minority or majority acquisition of existing shares of a company with the participation of a financial buyer. GCI: Growth capital and SoHo shops, the owed $58,071.19. Advisors signed a 10-year investment represents new money invested in a company for a minority stake. retailer hosts fitness- lease for 13,558 square SOURCE: CAPITALIQ related events and offers Madison Square Tavern feet at 41 Madison Ave. bright-colored workout 150 W. 30th St. The financial advisory clothes with graphic Filed for Chapter 11 bank- firm will occupy the cutouts. Dressing-room ruptcy on March 4. The entire 35th floor of the * GET YOUR NEWS ON THE RECORD seats are named for filing cites estimated building between East To submit company openings, moves or real estate deals, or to receive further information, London store locations. assets and liabilities of 25th and 26th streets. The email [email protected]. $1,000,001 to $10 million. tenant was represented For the Record is a weekly listing to help businesspeople in New York find opportunities, Terri The creditors with the by CBRE’s Sam Seiler. The potential new clients and updates on customers. Bankruptcy filings from the Eastern and 685 Third Ave. largest unsecured claims landlord, the Rudin Southern districts of New York are listed alphabetically, as are recently announced New The vegetarian fast-food are OnDeck Capital, owed Family, was represented York City agency contract opportunities. Real estate listings are provided in order of square restaurant opened in mid- $204,320; Dewey’s Inc., in-house by Robert footage. Stock transactions at New York’s largest publicly held companies were filed with town east. Its third city owed $181,903; and Steinman. The asking the Securities and Exchange Commission. Listings are in order of transaction value, and location offers sand- American Express Corp., rent was in the low $80s the information was obtained from Thomson Reuters. wiches, salads, wraps and owed $53,921. per square foot.

22 | CRAIN’S NEW YORK BUSINESS | MARCH 14, 2016 PHOTO FINISH

Cutting steel laser sliced through stainless steel in the Milgo/Bufkin workshop in Williamsburg, Brooklyn, carving the last sheet before the shop closed at A3:30 p.m. Mounted on a maglev platform, simi- lar to what powers high-speed trains in Japan, the technology is revolutionary—especially for a 100-year-old metalworking company. Milgo has stayed at the forefront of the business. Started by a Russian immigrant in 1916 as a horse-cart manufacturer, it developed one of the first aluminum truck bodies in the 1940s before it transitioned to architectural metal fab- rication in 1963, when Bruce Gitlin joined his father, Max, in the shop. When a childhood friend showed up asking Bruce to turn a design into a $50,000 metal sculpture, Max made it on spec. That artist, Robert Morris, was an early practitioner of minimalism, and his success “started a parade of artists out to Brooklyn,” Bruce Gitlin said. In 2012, the Metropolitan Museum of Art asked Tomás Saraceno in 2012 to create the nearly 20-ton sculpture Cloud City for its rooftop. “The Met basically said, ‘You’re making it at Milgo,’” Gitlin recalled. Art accounts for about 30% of the company’s work, which includes interior steel details for the Twin Towers and Robert Indiana’s LOVE sculpture on Sixth Avenue. (Gitlin offered to do the Statue of Liberty torch interior for free, but the city turned him down.) Expansion is difficult, Gitlin said, because craftsmen are in short supply. Another high- end fabricator, 87-year-old Gratz Industries, left Queens for Philadelphia in 2014, believing the city was prioritizing startups over older businesses. Milgo/Bufkin’s reign relies on con- stant innovation. “If we were doing this by hand,” Gitlin said about the metal cutting and shaping, “we couldn’t beat the Chinese.” — PETER D’AMATO PETER D’AMATO

MARCH 14, 2016 | CRAIN’S NEW YORK BUSINESS | 23 Move your business forward. Leave data limits behind. Get the best Unlimited 4G LTE data plan.

UNLIMITED LTE DATA ON YOUR SMARTPHONE 3 LINES, $50 EACH /mo. 4TH LINE FREE

Can’t get unlimited data for your business? That’s because the other carriers either don’t offer it or charge a fortune for it. With T-Mobile @Work, you’ll get three lines with unlimited 4G LTE data on your smartphones for just $50/line, and your 4th line is FREE! Need new phones too? Get the brand new Samsung Galaxy S®7 and Galaxy S®7 edge now.

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

Limited time offers; subject to change. Taxes and fees additional. Credit approval, deposit, and SIM starter kits may be required. If you switch plans you may be bound by existing terms (including early termination provisions) and/or charged an up to $200 fee. 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. Unlimited 4G LTE plan includes 200 MB roaming. Coverage not available in some areas. Network Management: Service may be slowed, suspended, terminated, or restricted for misuse, abnormal use, interference with our network or 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. Devices simulated. T-Mobile and the magenta color are registered trademarks of Deutsche Telekom AG. © 2016 T-Mobile USA, Inc.