Despite challenging headlines, though, Mr. Kenny said, One57 was ultimately handled the way that any transaction would have been. Asked why it made sense, he didn’t hesitate. “First and foremost—and this is philosophically the way that we always try to manage our business: sponsorship,” he said. “We had existing relationships with both the development and equity partner here in New York and the equity partner overseas. Number two, the amount of cash, equity, in the transaction was extremely significant and, again, that’s something we look for as a pillar of how we want to do business. The third is the business plan. Did the business plan make sense? And so Hyatt’s involvement with a new brand that they were bringing to New York, their capital was committed to it and there was a contractual obligation for them to purchase the hotel upon completion.”
An additional bonus to the One57 deal has been the influx of other business, though Mr. Kenny wouldn’t be specific about exactly what deals have come to the bank as a direct result of the project. Among these might be the funding of a construction loan for a freestanding hotel that Extell is reported to be putting up on 45th Street.
“That transaction led to a very significant increase in our relationship with the partners involved,” he said, “and identifiable, profitable transactions that we were able to complete for those clients. Then I think it also positioned us in the marketplace as, ‘Wow, Bank of America (BAC) is willing to be creative, to be thoughtful and to try to help clients achieve their goals.’”
Other recent deals include $90 million in construction financing provided to TF Cornerstone for a multifamily project at 45-60 Center Boulevard in Long Island City, Queens, and a bevy of term loans that show positive results for Bank of America’s efforts at better balancing its portfolio—though many are for properties and projects located outside the New York tristate area. For example, there was a $79 million, 5-year term loan on residential properties at 9045, 9090, 9110 and 9120 Judicial Drive in San Diego, a $70 million term loan to Building & Land Technology for its residential property at 101 Park Place in Stamford, Conn., and a $125 million term loan for a Monday Properties office portfolio in the D.C. metro area.
The bank also recently provided an acquisition loan for a Gramercy Park office and retail project for Angelo, Gordon & Co., Mr. Kenny said. Angelo Gordon is also working with Bank of America to potentially refinance the construction of its condominium conversion at Carlton House at 680 Madison Avenue, along with Extell Development.
Adam Schwartz, managing director and head of real estate at Angelo Gordon, said that the amount of the refinancing hasn’t yet been determined but that talks with Bank of America are underway.
“I enjoy dealing with him,” Mr. Schwartz said. “He’s a real straight-shooter and does what he says he’s going to do for you. He doesn’t play games and is just a good guy.”
Another client, Jeff Blau, president of the Related Companies, applauded what Mr. Kenny did as the market first started to improve.
“Bank of America has really been on the forefront of real estate lending to the best customers since the aftermath of the downturn,” Mr. Blau said, “which I think was a very smart strategy to pick up market share.” He added that the bank has looked at top-tier only for construction financing and has been shrewd in picking and choosing who to do business with.
“They are right now involved in virtually every single construction financing that we’re doing,” Mr. Blau pointed out. He added that Bank of America has been aggressive in booking new business with Related since other banks have pulled out of the marketplace.
It’s a volume of business that requires a great deal of focus, not to mention the patience required to effect some change in the make-up of the bank’s lending platform.
The fact that he is shrewd, with an eye on the bottom line is perhaps a function of Mr. Kenny’s background. He grew up in working-class housing in Stuyvesant Town and said that he often runs loops there as part of his marathon training. Later, his parents’ dream of home ownership prompted a move to Long Island. After his grandfather retired, his grandparents made the move from Stuyvesant Town to Long Island as well.
He has an accounting degree from the State University of New York at Plattsburgh, but said that he never “applied the craft directly in an accounting firm.” Currently, he splits his time between the family home in Vestal, N.Y. and a Tudor City apartment.
Asked about role models in the business—anyone who mentored him as he was coming up in banking or had a particularly positive influence—he instead credits his parents.
“They had incredible work ethic and instilled that in me and I think that is the number one thing that separates successful people from less successful people,” he said. “What we do is relatively straightforward. We make judgments on people and their financial profiles.”
His parents also instilled in him the importance of being prepared—something likely to come in handy November 4. “If you’re not prepared, you’re not going to be successful—whether it’s running a marathon or running a business,” Mr. Kenny cautioned. “They always say, ‘Enjoy the journey.’ The journey is in large part about the preparation to get to the point where you can be successful, so I take a lot of pride in working hard and trying to be enthusiastic about what I do. I have my days just like anyone else where it seems harder than it should be. But that’s O.K., because the next day I’m back and I’m energized and I’m eager to go.”
cgaines@observer.com
