Tom Acitelli


Multifamily Meltdown

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It is a question clanging around the minds and meetings of residential lenders this spring: What if the state repeals the decades-old 421a tax abatement? The law, a staple of New York City multifamily finance, has been renewed continually since the 1970s, but comes up for renewal this June. Such a scenario has lenders pondering a financing ecosystem steered almost exclusively toward condominiums and commercial developments such as hotels, or toward that rare development firm that could finance most of its rental project solo.

Indeed, the great multifamily minds of the city generally agree that the abatement is a key crutch propping up development here. And the one thing upon which politicians, lenders, renters and developers all agree is that new housing and improvements in existing apartments in New York City is necessary. Read More

Cover Story, Feature

Why a Merger Wave Washed Over Manhattan CRE in 2014

TOP DOGS: Savills Studley’s Mitchell Steir; Massey Knakal Realty Services’ founders Paul Massey and Robert Knakal; 
and Peter Hennessy, the president of the New York Tri-State Region at Cassidy Turley (from left).

On New Year’s Eve, Cushman & Wakefield closed on its acquisition of Massey Knakal Realty Services, thereby finishing the last big commercial real estate merger in a 2014 full of them.

Other large-scale takeovers included DTZ’s acquisition of brokerage Cassidy Turley (which followed private-equity firm TPG Capital’s takeover of DTZ, a property services firm); and London-based brokerage Savills’ acquisition of New York tenant-rep brokerage Studley. CBRE, the city’s biggest commercial brokerage, also acquired 10 different firms worldwide, including real estate consultancy IVI International, which is based in White Plains. Read More

Mortgage Observer, CMBS

Two Men and a Heyday

Michael Lehrman.

As a kid, Michael Lehrman used to play a game with his grandfather, the late Bronx landlord and developer David Buntzman. They would walk into a restaurant when they knew it would not be that busy—say, between lunch and dinner—and count the chairs and the tables.

“I realized later in life,” Mr. Lehrman said during a recent interview with Mortgage Observer, “that he would slip the guy some money. We’d go into the kitchen, and then we’d talk to the people working there; and find out what works and what doesn’t—how do you make a small business work, how do you make a business that focuses on making its customers happy every day or they won’t come back.” Read More

office space

The Fall Season in Downtown

Tara Stacom of Cushman & Wakefield.

“I’m more bullish today than I was in 2007,” said Cushman & Wakefield’s Tara Stacom of  1 World Trade and the outlook for the 1,776-foot tower that will offer 3.1 million square feet of Class A office space. “I did not think one of the first tenants would be a million-plus feet.”

Signing the lease with Condé Nast in May of this year was, for lack of a less hackneyed term, a game-changer for downtown Manhattan, especially as the area emerges not only from the Great Recession but from the malaise that characterized so much of the area since 9/11. Read More

The Sit-Down

Mitch Rudin’s Quarterly Report


In June, Mitch Rudin took the reins as Brookfield Office Properties’s president and C.E.O. of U.S. Commercial Operations following news that Ric Clark would relinquish his role as president of the Canadian firm, which controls downtown’s World Financial Center, while remaining on as C.E.O. of corporate operations. Last week, Mr. Rudin, 58, assessed his progress.

The Commercial Observer: So, why don’t you assess your progress over your first 60 days at Brookfield?

Mr. Rudin: It’s been terrific. I wouldn’t quite call this my midterm report card, but I’ve been here for two months, and to the extent that there have been any surprises they’ve all been pleasant.

What kind of surprises? Read More

Power Broker

Silverstein's Janno Lieber on the Progress at Ground Zero

Mr. Lieber joined Silverstein in 2003.

Uniformed men milled about, waiting for Leon Panetta, the newly appointed Secretary of Defense, to embark on his morning tour of 7 World Trade Center. At the same time, the leader of one of the city’s most powerful trade unions was being greeted as he crossed from the building’s elevator bank to a floor model of the World Trade Center site. Heavyset and stoic, that labor leader was there to address the members of Helmets to Hardhats, an organization that assists soldiers in their transition from battlefields to construction sites.

A few hours earlier, Mayor Bloomberg had arrived in Lower Manhattan along with his own entourage, calling for the end to “Ground Zero” as the shorthand to describe what, over the course of a decade, has changed from a pile of smoldering ashes to the early metallic seeds of a transit hub, a memorial site and a massive complex of skyscrapers. Read More

Lease Beat

High-End Coffee Outfit Signs with Harbor


Coffee Bean & Tea Leaf, which is a purveyor of bowling balls (seriously, though, they sell coffee), has signed a 1,500-square-foot retail lease on the ground floor of 1412 Broadway.

The deal at the base of the 24-story, Harbor Group International-owned building brings occupancy to 95 percent occupancy, brokers told The Commercial Observer. The company, which operates at 750 locations worldwide, has, until now, not peddled its iced coffee, green teas or signature brews from a Manhattan store. Read More

Lease Beat

Finance Firm Expands in Trinity’s 100 A of A

100 Ave of Amer (1)

Two Sigma Investments, an international finance and technology firm, has inked a five-year lease at 100 Avenue of the Americas that will allow the company to expand from its current 38,332 square feet, brokers told The Commercial Observer. Read More


The Closing: Doorman Debate; 3 Columbus Circle; Night at the Apthorp

Jonathan Miller breaks down Manhattan housing, pre- and post- 9/11 and Lehman Brothers. [Journal]

How the Lower Manhattan skyline changed—slowly—over the last decade. [Curbed NY]

3 Columbus Circle ready for its close-up. [Crain’s]

Mayor Bloomberg’s ex- goes to contract at One Kenmare. [NY Post]

Ralph Gardner Jr. sleeps with the Apthorp, tells. [Journal]

Resolved: the doorman is pointless. [Real Deal]

Avenue U out of juice because of a fire. [Sheepshead Bites]

And this Fort Greene house made us pause and stare wistfully out the window. [Brownstoner]

the lead indicator

Taking Economic Stock at Summer’s End

A winter of discontent coming?

The summer our discontent behind us, the weight of inaction threatens anew. It is readily apparent from the most recent data that economic growth and labor market trends slowed markedly during July and August. Yet precious little has been accomplished over this same period to seriously assess or offset the deficiencies in the recovery.

Absent politicians in Washington calming down, or new private or public sources of stimulus, the near- and medium-term outlook for the economy remains clouded. Would that policymakers could approach the growth and employment conundrum with the same zeal—and occasional ferocity—as they approached the budget debates over the past few months, we might be in a stronger position two years after the recession reached its putative end. Read More

Lease Beat

Upscale Footwear Walks Into 807 Washington

Fashionable club-goers and maybe even a few hog butchers will be able to navigate the brick roads of the meatpacking district in style now that Nicholas Kirkwood, the upscale designer footwear brand has inked a 1,572-square-foot retail deal at 807 Washington Street.

Located between Gansevoort and Horatio streets, the ground-floor boutique is scheduled to open by winter of 2012, broker said. As with most space—office and retail alike—asking prices have risen in the area since the High Line park opened two years ago, although specific prices at 807 Washington Street were not immediately available. Read More

The Sit-Down

Trumpeting Change on Third


Since 2009, Gerard Nocera, Michael Reid and John Monaco have helmed Herald Square Properties, an investment and operating company that has, since launching, provided asset management services for more than 800,000 square feet of office properties in Manhattan. The former COO of SL Green, Mr. Nocera, 54, spoke about the revitalization program at the Lipstick Building at 885 Third Avenue and the company’s efforts to acquire new property. Read More

Power Broker

The Recycler

Mr. Farkas started Metropolitan Realty Associates in 2001.

In its heyday, the manufacturing plant in Garden City, Long Island, housed laboratories for DuPont Pharmaceuticals before it went on to harbor chemists with a competing drug maker, Bristol Myers Squibb. But by 2004, the 188,500-square-foot complex of two buildings on Stewart Avenue and Endo Boulevard—a street named for the pharmaceutical firm that originally occupied the plant in 1964—had become a casualty of new compliancy standards by the F.D.A. In other words, the cost of upgrading the complex to conform was no longer in the best interest of the owner or even Bristol Myers Squibb, which relocated.

Enter Joe Farkas, a former CB Richard Ellis broker who, as president of the Jericho-based Metropolitan Realty Associates, has mined real estate gold from older assets, like the Garden City site, that have outlived their original use. Read More


The Closing: Super-Late Labor Day Weekend Edition

Perhaps the most articulate review ever of a carousel: Jean Nouvel’s design for Jane Walentas. [NY Times]

It’s First Avenue’s moment to shine because Second Avenue’s so terrible right about now. [Journal]

Five rats go after Jay-Z near Madison Square Park. [Curbed NY]

The $90 million mansion on East 80th Street is off the rental market and, we assume, headed for a mighty, mighty price-chop. [Curbed NY]

Catholic priests sell to Jewish retirement home in Riverdale… there’s a walks-into-a-bar joke here somewhere. [Daily News]

The story of 5 Franklin Place and its foreclosure. [NY Times]

‘Stoner checks in on new studios rising at Steiner. [Brownstoner]

The Earl of Sandwich is going to eat New York City. [Crain’s]

Housekeeping note: We will be blogging only sporadically on Monday. See you in the autumn.