Reeling in the Years With the Real Estate Board of New York: In their own words, brokers and owners tell the tale of REBNY’s past half century
Jotham Sederstrom Jan. 17, 2012, 10:30 a.m.
Since it started with a roll call of 27 members in 1896 with the goal of “facilitating transactions in real estate,” the Real Estate Board of New York has indisputably been the city’s most influential real estate organization, with its annual gala being to brokers what the Vanity Fair Oscar party is for Hollywood: If you’re there, it means you’re somebody.
Sure, some may lovingly write it off as a veritable men’s club (men are thought to outnumber women five to one), chide it as “The Liar’s Ball” (each year is a broker’s best year, no matter how wretched the marketplace) and speak ill of the food (nearly everyone avoids the chicken and filet mignon).
But the REBNY gala is as essential to a real estate person’s reputation and status as the buildings and bricks he works with. A dozen of the city’s most legendary players spoke to The Commercial Observer about the blurry nights and boom years that helped make the event what it is today.
The 1950s and 1960s: “The Liar’s Ball” is coined
When the 1950s arrived, the board had expanded enough to stock a banquet hall with men in tuxedos and cigars. Some of today’s most venerable REBNY members attended those balls when they were still wet behind their ears.
Burton Resnick (chairman and chief executive officer, Jack Resnick & Sons, chairman emeritus of REBNY): I remember I was with my father and at that time you [could] cut the air because everybody was smoking cigars and everybody was doing deals. I’d like to have a dollar for every deal that wasn’t done.
Fifty years ago, 75 years ago, it was primarily brokers … but the owners were already there. The brokers were the leadership. I think the owners started being leaders in the last 40 years. They were always there, and I think it was only a matter of who smoked the longest cigar.
Larry Silverstein (president and chief executive officer, Silverstein Properties, former REBNY chairman): I think I started going to these REBNY balls I would say in the late ’50s. I remember missing one. There was one hell of a huge snowstorm—I think it was 1961 or 1962—massive snowstorm, and there was such a terrible night.
Stephen Siegel (chairman global brokerage, CBRE): It was fascinating to be surrounded by people like Leona and Harry Helmsley and Aaron Gural, and some of the legends of our business. Years later I also coined the phrase “The Liar’s Ball,” because no matter how terrible the market was, everybody had their best year ever: “Oh, my god, what a year I had! I would never have imagined in this economy!” So I used to get a kick out of that.
Jerry Speyer (chairman and co-chief executive officer, Tishman Speyer): The people who spoke were then the chairpersons and the people who were engaged in the city, like the mayor and the luminaries who represented the city infrastructure.
The one thing that was consistent was that it was extremely hard for anybody to get the attention of the people attending. It wasn’t until Bernie Mendik became chairman when he got up and made a noise to quiet down, like “Shhhh!”—you know, the kind of sound when you’re trying to calm a child down—and it worked like a charm. He was the first person to really get control of the room.
What was it like in the 1960s? It was probably more formal. People were behaved a little better. They were rowdy in their own ways—Harry Helmsley used to have a party after the Real Estate Board dinner, to which a relatively small group of people were invited. It was a lot of fun. He was a wonderful host.
1970s: Oil Prices Soar and Reciting the Declaration of Independence
The 1970s proved to be a financially challenging decade for REBNY and the real estate industry. Middle East “oil shocks” sent heating oil prices soaring, affecting several buildings. The city and the industry were faced with other financial perils, including a near-bankruptcy for the city and stubborn stagflation.
Peter DiCapua (chief operating officer of ATCO Properties & Management Inc.): If I recall, everything was about inflation and I think we were all concerned about was whether the assets of specifically the commercial real estate industry were going to keep up with inflation. And I think the mood was everybody had their own opinion about that. It’s a diverse group, I tend to be on the optimist’s side. I always say, “We’ll do OK …” Other people like to say the glass is half empty and it’s draining. I don’t think the mood was totally negative. I think it was balanced but concerned.
Mr. Speyer: Real estate’s problems started in 1972, and they got worse as the city’s problems got worse. At that point the real estate markets went down radically, and stagflation was definitely having a big affect on the Real Estate Board dinners.
People felt pretty down. There was not much renting going on, there was a lot of empty space, space downtown was going begging because the World Trade Center had been built and didn’t get rented until the late ’70s, space in Midtown was going begging. There was a lot of stuff going on that wasn’t pretty, to say the least.
Jeffrey Lichtenberg (executive vice president, Cushman & Wakefield): Originally when I started [in 1977] I thought this was a huge big-deal issue and you had to be there. I remember a company called Swig Wyler & Arnell invited me. I remember talking [with Norman Jacobson, then the head of leasing for Swig Wyler] about East 42nd Street and how I thought that … Donald Trump redeveloping the Commodore Hotel into the Hyatt was going to change East 42nd Street for the better. This is not a bullshit story.
Mr. Silverstein: Seymour Durst was chairman of the board and when he got up, he started speaking, and he started reciting the Declaration of Independence. Nobody, absolutely nobody, cared about what he said, because who’s paying attention? He just rambled on and on, everybody was going about their business like he didn’t exist. The funny thing is he told me the next day he met some people and they said, “Hey did you make the ball last night? We didn’t see you.”
Mr. Speyer: The markets really began to turn in 1977. Then in ’78 and ’79, they really got better. Buildings went up, buildings were being renovated, there were a lot of good things going on.
1980s: The Rise of Manhattan
With the growing pangs of the 1970s long behind them, REBNY members welcomed an explosion of bigger buildings and bigger deals, perking up the moods of the REBNY gala … that is, until 1986 arrived.
Peter Hauspurg (chairman and chief executive officer, Eastern Consolidated): From 1981 to 1986 was really one of the great rises of Manhattan real estate in terms of activity and prices and people who are making a lot of money. So the mood during those times was buoyant, and then they changed the tax law at the end of 1986 [Tax Reform Act of 1986] to discourage syndication and the tax aspects of investing in real estate and activity plunged, for a while at least.
Mr. DiCapua: Through 1986, before everybody realized we had too much money and we were building foolishly, anybody who rubbed two sticks together got the financing and started a 40-story building. It was just too much and we oversaturated the market. We paid for it.
Mr. Speyer: In 1986 there was a big tax rehaul, and the real estate industry took a big hit in 1986, and that affected the industry in a significant way. And that combined with the changes in the economy in the next couple of years, the real estate business was really in tough shape by the end of the ’80s, and during the next five, six years, the industry was in a very difficult position to say the least.
While the economy rebounded—only to stumble once again—one thing was certain: REBNY attendees still would not stop talking for anyone, no matter who the speakers were. And one formerly fail-proof trick did not stand the test of time.
Fred Wilpon (co-founder and chairman, Sterling Equities): No one sits at the table all the time. Everybody is standing and schmoozing and talking, and one year I was to start the [gala]. I tried to get their attention and I couldn’t get their attention. It was impossible. The roar of the crowd—of them all talking to each other. And finally I [started] going, “Four score and seven years ago, our fathers …” A couple people in the front heard it and they were hysterical. The rest of them, they didn’t hear it, until they decided to say “OK, now we’ll go down to a minor roar rather than a large roar.”
Around that same time, several of real estate’s brightest female stars—including a future REBNY chairwoman—started attending the galas.
Mary Ann Tighe (chief executive officer, CBRE, current REBNY chairman): I remember it being a terrifying event for someone who was new to the industry. I remember thousands of men in black tie, and a tiny sprinkling of women in the mix. I remember the shock of [seeing people speak] through the invocation back in the day.
Leslie Himmel (managing partner, Himmel + Meringoff Properties): I will be embarrassed to say, and I’m not sure you should print this, is that I came to meet some friends who had tickets, and they just like walked me in. I sat all the way up in the mezzanine, so I didn’t even have a ticket for downstairs. I was way up in the mezzanine looking at everybody down below.
I can remember looking at the people who were then, I guess, on the executive committee and the powers that be, and you had people like Larry Silverstein and Bernie Mendick, and I think even Harry Helmsley.
It was my dream to one day be an owner, never mind a significant owner. So now it’s 30 years later and not only am I an owner of a few million square feet, but I am on that stage. I even was lucky enough to get the Bernie Mendrick Award, so it marvels me. When I got that award last year I can remember sitting up in the mezzanine and just saying “one day, I just want to own a few buildings.
Faith Hope Consolo (chairman retail leasing, Prudential Douglas Elliman Real Estate): I was at my old firm, which was Garrick-Aug [Associates] at the time . I felt like a little bit of a lost little girl. I mean, there weren’t a dozen women in the whole room out of 1,000 people.
Ms. Himmel: It was a great place to meet new people, but it was way smaller so it was easier. You could walk around and you could meet for the first time people who were very significant.
Ms. Tighe: One of the things I often joke about is after you’ve had the experience of going, how particular you become about the dress. Because you’re so densely packed, you can’t have a dress that drags on the floor, because people will step on you all night long.
Perhaps most impressive to newcomers was the universal respect held for Harry and Leona Helmsley throughout the entire REBNY gala.
Ms. Consolo: Oh, gosh, they held court. They had a table right in the front, front and center. And of course, she was, you know, very over the top. I got along with her very well. But Harry was very well respected because many of the men in that room he made very rich. I mean, he was like a dean and people liked him personally and professionally. And they would all come over and pay homage.
Mr. Silverstein: Truth of the matter is I’m a legend, but only in my own mind am I a legend, so I don’t consider myself kind of a luminary. I think of Harry, he was just a remarkable guy in his day. It’s amazing the swiftness with which legendary characters become a matter of past interest and very little relevance to today. Quite something. But it’s testimony that we are all here for a very fleeting time, and the world does not revolve around us and we’re not the masters of the universe we like to think we are or are not the legends we like to think we are. In a sense, when you think about it, it’s humbling.
The 1990s to Now: Boom and Bust
Mr. Hauspurg: Then, of course, the market turned and got worse in the early ’90s, and attendance at the banquets dropped markedly. Lot’s of people left the business—it was an awful time. I remember in the darkest days of it, which were ’91 or ’92, someone came up with the slogan “stay alive ’til ’95,” and, sure enough, it was actually ’95 when the market started to get healthy and turn again and attendance again returned to the banquet.
Mr. Siegel: The best of all was when Eddie Gordon, my partner, passed away in  and I knew nobody would be quiet and I was asked to give a eulogy, and I kind of went “phewww, phewwww” into the microphone and I said, “I am going to ask you all to be quiet for 60 friggin’ seconds in honor of an icon of this business. One of the biggest real estate men we’ve ever had in this city of New York and in his memory I’d like 60 seconds of silence at a dinner which never had 1 second of silence.” And all of a sudden, I kept shushing and shushing, and the word spread and it was dead silence in Eddie’s honor … for about 12 seconds. [Laughs.] I didn’t even get a half a minute, but you know what, I got 12 seconds and I can tell you right now, I don’t think anyone’s ever gotten anything close, including Giuliani [and] Bloomberg.
Today, with people from every corner of the commercial real estate industry attending the gala, many REBNY vets believe it will continue to be a draw for years to come.
Mr. Resnick: I think over the last 20 years we’ve been averaging over 2,000 people, even in the bad times. They’re a lot younger, which I guess is a natural transition, that the young start kicking out the older ones. And hopefully the real estate board will be important to all of them.
Mr. DiCapua: We have 2000-plus [attendees] every year at the banquet. Back in the ’70s, it was half of that. It wasn’t anything close to those numbers. People feel the need to see and be seen, and if they’re not there they are missing out on some very substantial networking.
Ms. Tighe: The mayor and the governor still come usually just to the cocktail hour. And the other public officials come and sit on the dais, but we don’t subject them to the experience of speaking. I have to tell you that [the constant banter] is part of the tradition of the event. I’ve now come to the belief that people would be alarmed if suddenly folks were quiet.
Ed Koch (former mayor of New York): I remember who they are but I have nothing anecdotal to tell you.