20120820-NEWS--0001-NAT-CCI-CN_-- 8/17/2012 6:12 PM Page 1 REPORT REAL ESTATE ROOFTOP FARMS yield profit and PR CRAIN’S® P. 13 NEW YORK BUSINESS VOL. XXVIII, NO. 34 WWW.CRAINSNEWYORK.COM AUGUST 20-26, 2012 PRICE: $3.00 GREG DAVID Lies, damned lies, and jobless statistics 10% unemployment? Bogus number masks city’s true job growth BAM! New York City added 10,000 jobs in Fundraising wonder July, according to the people who track the city’s economy, continuing Karen Brooks Hopkins an economic expansion that has been as strong as that in any area of the has turned Brooklyn country. The unemployment rate remained Academy of Music stuck at just over 10%,the highest rate among the largest cities in the coun- into a cultural empire. try, signaling a deeply troubled job market. She’s still not satisfied Could both these statistics be true? No. This is a story of lies, damned lies BY MIRIAM KREININ SOUCCAR and statistics, and of the government officials who have screwed up, the Karen Brooks Hopkins expects the worst and journalists who don’t make the effort leaves nothing to chance. Upon landing a to understand what’s going on, and multiyear corporate grant, the president of the politicians and advocates who are the Brooklyn Academy of SWEET MUSIC: misleading New Yorkers about the Music starts wondering BAM raised a record state of the city, intentionally or not. how she will replace the $51.6 million in If you really need to know the bot- fiscal year 2012. tom line now, here it is: The unem- funds when the money runs ployment rate lies.The city’s economy out. She frequently bemoans the fact that in- is creating tens of thousands of new dividual donors are skittish about giving these jobs for people with education and days and that corporations and foundations skills, and even more jobs for those are abandoning the arts. And when she talks with few credentials. See BAM! on Page 20 This story begins with the nature of economic statistics. Each month, See UNEMPLOYMENT on Page 20 buck ennis RUSSELL’S NEW LINE Phat Farm founder Russell Simmons ELECTRONIC EDITION teams up with designer Joseph Abboud NEWSPAPER PAGE 3 20120820-NEWS--0002-NAT-CCI-CN_-- 8/17/2012 6:26 PM Page 1 STATS AND THE CITY FAST-TRACKING THE BROOKLYN BRIDGE A City Council trio wants to widen the upper boardwalk level of the bridge, where pedestrians and bicyclists are often elbow to elbow. Any changes to the city’s best-loved span will be hotly debated, but here’s where things stand: FYICRAINSNEWYORK.COM 120,000+ MOTOR vehicles cross the bridge daily 4,000+ PEDESTRIANS cross the bridge daily Lawsky scores $340M 3,100+ CYCLISTS cross the bridge daily ust eight days.That’s all it took for the New York Department of Financial 1984 YEAR bike lane added to the boardwalk JServices to transform itself from an 1¢ TOLL 150K pedestrians paid to cross opening day, 1883 unknown regulatory fledgling into a heavy hitter. Eight days was all it took for Britain’s Standard Chartered Bank to cry wide world photos wide uncle and settle with the department after / its superintendent, Benjamin Lawsky, ap accused the bank of handling $250 billion worth of banned transactions for Iranian clients—and threatened to pull its New York license. Critics, including The Wall Street Journal, called Lawsky a grandstander for jumping the gun on a posse of other regulators on the bank’s trail, but in the end he was the guy with the badge who got the bank to cough up $340 million in fines. The question now, of course, is what other sorts of market abuse Mr. Lawsky has his eyes on. Considering his department oversees the local operations of many of the world’s biggest banks buck ennis Sources: NYC Dept. of Transportation, WGBH, BrBridge.com and insurers, the pickings are potentially rich. Meanwhile, another New York regulator was throwing his weight around. Attorney General PRICES ON PAUSE Eric Schneiderman served subpoenas to seven large banks for information regarding possible The pace of hikes in the consumer price index heated up a bit this manipulation of the benchmark global interest rate, LIBOR.The banks served are reported to summer in the local area, but is still far below the level of a year ago. include JPMorgan Chase & Co. and UBS. In other words, a roundup of the usual banking giants. 3.8% 3.8% % change in local CPI, y-o-y Mr. Schneiderman, it’s worth noting, is conducting his investigation in concert with his 3.3% Connecticut counterpart. —aaron elstein 3.0% 2.8% 2.7% 2.6% 2.6% 2.4% NAVAL-GAZING IN B’KLYN. It may take of sitting idle, a revamp of the place a dozen years to pull off, but plan- will take another year. On a more HOORAY! 1.6% ning is underway for a 50-acre me- savory note, the city wants Tavern 1.1% 0.2% dia campus in the Brooklyn Navy to cater more to New Yorkers’ A 2.9% ’12 Yard, according to The New York tastes, using more locally sourced AVERAGE GRAY LADY TRIES raise is in A SOND J FMAMJ J Times. It is to be a joint effort of the ingredients. … store for Source: Bureau of Labor Statistics yard’s largest tenant, Douglas BRITISH ACCENT. Looking for a leg New Yorkers Steiner of Steiner (TV and film) up in the digital realm, The New at larger firms next ADDICTED TO NUMBERS? GET A DAILY DOSE AT @STATSANDTHECITY Studios, and his landlord, the city- York Times Co. is bringing in an year. It’s the owned development corporation executive who did just that for a far biggest in that runs the 300-acre place. It larger organization across the pond. four years. comes at a time when TV and film In November, departing BBC Di- THIS WEEK IN CRAIN’S production is booming in the city. rector-General Mark Thompson … GOOGLE’S TRAVEL PLANS. The will become the Times Co.’s CEO. OY VEY! IN THE BOROUGHS-------------------------- 3 search-engine giant is snapping up His track record is superb but a bit THE CITY’S bike-share program has Frommer’s, creator of the famous odd—the state-owned BBC, af- IN THE MARKETS----------------------------------4 been delayed yet again—this time until travel guidebooks, from ter all, has no shareholders spring, if we’re lucky. THE INSIDER -----------------------------------------------6 Hoboken-based publish- nor advertisers, much less er John Wiley & Sons a controlling clan like OPINION --------------------------------------------------------10 for a reported $25 mil- the Sulzbergers. … ALAIR TOWNSEND -------------------------11 lion. Frommer’s will BACK AT THE INN. FROM AROUND THE CITY----12 join Zagat, publisher Chicago-based Strate- of the ubiquitous gic Hotels & Resorts is REPORT: REAL ESTATE-------------13 restaurant guide, which checking back into the REAL ESTATE DEALS-------------------14 Google bought late last 509-room Jumeirah year. Google aims to draw Essex House big-time. Sev- THE LIST: more eyeballs and ads by be- en years after selling the property TOP AIRLINES-----------------------------------16 coming the go-to source for travel to a Dubai-based group, Strategic is ever “yogurt summit,” even the nor- and local business info. It’s also buying the place back for $362 mil- mally crusty Assembly Speaker CLASSIFIEDS ----------------------------------------- 17 drawing attention from antitrust lion. That looks to be a bit less than Sheldon Silver proclaimed such a GREEN REVOLUTION. BUSINESS PEOPLE NEW YORK, NEW YORK ----------21 authorities. … it sold the Central Park South thing entirely doable “if we make it Surprise, surprise—the city is hostelry for back in 2005, and is less our mission.” … AND NOW A WORD Amy Smilovic raised prices SOURCE LUNCH-------------------------------- 22 bringing in a small Philadelphia- than many predicted. ... CUOMO’S FROM OUR PARENT. Crain Commu- during the recession to stand OUT AND ABOUT ------------------------------ based firm to run Central Parks’ DAIRY DREAM. Gov. Andrew Cuomo nications Inc. is investing in Inter- out. Her risky strategy led to 23 Tavern on the Green, once the is hoping to make the Empire State net Week NY, and will take over higher sales. P. 8 SNAPS--------------------------------------------------------------23 highest-grossing restaurant in the nothing less than the nation’s yo- day-to-day management of the 5- CORRECTIONS nation. After more than two years gurt capital. At New York’s first- year-old event. —lauren elkies City Councilman Dan Garodnick has $1.1 million cash on hand for his 2013 campaign for comptroller. That amount was misstated in the Aug. 13 Insider item “Brooklyn contender bides his time.” Howard Glickberg is Fairway’s vice chairman of development. That fact was misstated in STORIES TO WATCH THIS WEEK the Aug. 13 “Fairway’s IPO feeds growth.” vol. xxviii, no. 34, august 20, 2012—Crain’s New York Business (issn 8756-789x) is published Aug. 20: U.S. Aug. 20: City Aug. 21: Barnes & Aug. 22: Michael weekly, except for double issues the weeks of July Fourth, Labor Day and Christmas, by Crain Communications Inc., 711 Third Ave., New York, NY 10017. Periodicals postage paid at Open qualification Planning expected Noble booked to Jordan co-hosts New York, N.Y., and additional mailing offices. 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