20090907-NEWS--0001-NAT-CCI-CN_-- 9/4/2009 7:18 PM Page 1 REPORT REAL ESTATE WRECKS drawing buyers P. 13 GREENWICH clipped by hedges P. 13 TOP 25 REITS in NYC P. 16 ® DEALS Signs of life in leasing P. 20 INSIDE VOL. XXV, NO. 36 WWW.CRAINSNEWYORK.COM SEPTEMBER 7-13, 2009 PRICE: $3.00 TOP STORIES The new Which 2 ZIP codes faring best/worst kings of PAGES 2-3 Public advocate Wall St. candidates bad for NY business One year after EDITORIAL, PAGE 10 Lehman’s demise, Can Dan Brown new elite rises save publishing? BY AARON ELSTEIN PAGE 2 on sept. 16, 1920, Betsy McCaughey at precisely one tilts at health care minute after noon, Wall Street was lit- reform: Part Two erally shaken to its PAGE 3 foundations when Bob Diamond a massive bomb ex- ploded outside J.P. Morgan’s head- BUSINESS LIVES quarters, killing dozens and injur- ing hundreds more. ACT LOCALLY: Pockmarks from Nanette Lepore, the blast are still who’s prepping her visible. spring collection, James Gorman notes that On almost the manufacturing very same day, 88 here gives her years later—Sept. greater control. 15, 2008—Wall Street was rocked GOTHAM GIGS again. Shock waves reverberated Tina Taps takes on ball around the globe as boys and girls P. 25 Lehman Brothers G ANNE FISHER collapsed into says plan Thomas Joyce for succession, despite bankruptcy, a tee- the recession P. 25 tering Merrill buck ennis Lynch raced into G MOVERS & SHAKERS IN FOCUS the arms of Bank of Bluefly CEO talks America, and two P. 26 about fall shopping days later, Ameri- G GAEL GREENE Tale of can International 2 West Side joints P. 27 Group was taken over by the federal government. The Karl Wellner INDEX MADE IN NEW YORK financial system ground to a virtual halt. IN THE MARKETS _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _4 Only now is the NEW YORK, NEW YORK Lepore preps collection for Fashion Week runway _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _6 industry beginning THE INSIDER _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _8 staff is hastily cutting patterns and “The show is a jumping-off to regain its foot- OP-ED _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _11 BY ADRIANNE PASQUARELLI pinning materials. The designer point for the season,” says the de- ing. Capital mar- SMALL BUSINESS _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _12 herself bustles from room to room signer, who launched her epony- kets are starting to on a steamy day in August, to adjust the draping of a dress mous collection 17 years ago. “It revive as investors CLASSIFIEDS _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _21 Don Brownstein Nanette Lepore is in crunch mode mock-up. In between, she snacks really does push us.” rediscover a taste EXECUTIVE MOVES _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _25 getting ready for Fashion Week. on dark chocolate bark—lunch. Ms. Lepore is one of a few de- for risky bets. RÉSUMÉ REVIEW _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _26 Sketch boards and fabric swatches The Ohio native is in the process signers who still makes the major- Companies are starting to acquire THE WEEK AHEAD _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _27 are propped against walls in her of designing her spring 2010 collec- ity of her clothing—85%—in the competitors, the market for initial garment district office, and her tion, from which she will choose garment district. She sends work public offerings has reopened, and about 25 looks to appear on the run- to 10 neighborhood factories, it’s getting easier for consumers way on Sept.16.Along with her 120 some of which she’s used for more to—how quaint is this?—buy a 36 5 New York-based employees, she than a decade to manufacture her house. endures weeks of 12-hour days in ready-to-wear designs. From the wreckage of last year’s preparation. See MADE IN NY on Page 24 calamity,a new power elite is start- ing to emerge. These players, each ELECTRONIC EDITION See video featuring Ms. Lepore @ www.crainsnewyork.com/video and in their own way capitalizing on the distress of rivals, are some of NEWSPAPER check back online for daily Fashion Week coverage beginning Sept. 11 See NEW KINGS on Page 24 71486 01068 0 20090907-NEWS--0002,0003-NAT-CCI-CN_-- 9/4/2009 7:19 PM Page 1 FATES OF TWO ZIP IN BRIEF FORMER ALLIANCEBERNSTEIN CHIEF traffic, big chains proliferate, including EXECUTIVE LEWIS A. SANDERS PLANS TO Gap,Express and Duane Reade.The Cen- launch a money management firm in January— Astoria shrugs off ter for an Urban Future recently counted 55 a move that could ruffle feathers at his former outlets of national chains in 11103,enough employer, which ousted him last December. to rank Astoria fifth in all of Queens. Sources tell Pensions & Investments,a Crain’s The chains are good for the area be- publication, that the new investment firm will downturn’s worst cause they draw people who are willing to start off with well over $1 billion from a dozen spend, says Bijan Arshravan, owner of AllianceBernstein clients, as well as seven or Venice Menswear, which has been on eight research analysts from that company. John Diversity and retail strength help to weather storm Steinway Street for 30 years. Mahedy, an AllianceBernstein chief invest- “Steinway is one of the most desirable ment officer, is also joining the new firm. nomic diversity,” says Democratic Coun- retail corridors in the city,” says Timothy BY AMANDA FUNG cilman Peter Vallone Jr.“Our residents are King, principal of CPEX Realty.“It is sur- BRONX BOROUGH PRESIDENT RUBEN DIAZ JR. old-fashioned and hardworking and are rounded by canyons of apartments,a stable TOLD THE CITY PLANNING COMMISSION with the recession raging and two lo- the type of people who survive through all population base,and good transportation.” he would vote against The Related Companies’ cations just a mile from each other in Asto- types of crises.” The street has been a good location for proposed Kingsbridge Armory ria,the owners of Brooklyn Bagel & Coffee Gentrification began a few years ago, family-run Rizzo’s Pizza, through boom redevelopment plan in its Co. made an odd decision back in June. when young professionals fled Manhat- times and bad, for 50 years. Over the past current form. His objections They decided to open a third outpost in the tan,and even Brooklyn,drawn by Astoria’s year, revenue has risen 10% at the shop, focused on the lack of a middle-income Queens neighborhood fa- cheaper rents and quiet streets, plus the known for its square-shaped thin crust community benefits agreement mous for its ethnic diversity—and eateries restaurants, outdoor cafes and even a Bo- pies. outlining living-wage policies that draw patrons from far and wide. hemian beer garden that give it a surpris- “The increase keeps us above water,” and guarantees of expanded It was a good move.The chain’s newest ingly cosmopolitan feel. It also got a boost says second-generation owner David Riz- community space in the location, in the heart of Asto- from the venerable Kaufman zo. 600,000-plus-square-foot project. Mr. Diaz ria’s restaurant row along 30th NEIGHBORHOOD Astoria Studios as well as Similarly, at Empire Beauty School, added that he would reverse his position if a Avenue, is already ringing up from the nearby Museum of enrollment rose 12% to 150 since last year, community benefits agreement is struck. sales that rival its well-estab- JOURNAL the Moving Image. according to Laurence Nunez, the lished flagship in Manhat- school’s academic director. Empire LANDLORDS DODGED A BULLET LATE LAST tan’s Chelsea.