Last week, Stephen Ross, chairman of Related Companies, became the latest signatory of the Giving Pledge. The campaign, an effort to invite the world’s wealthiest individuals to pledge to donate half of their wealth—or more—to philanthropic causes, was started by two of America’s richest men: Warren Buffett and Bill Gates.
Mr. Ross, worth $4.4 billion according to Forbes, is perhaps best known in philanthropic circles for his $100 million donation to the business school at the University of Michigan, his alma mater.
The donation, the largest ever to an American business school, resulted in its renaming as the Stephen M. Ross School of Business. Inspired by Mr. Ross’s pledge, The Commercial Observer checked in on the philanthropic efforts of other real estate titans.
T he turnover of leadership at New York’s venerable real estate organizations has been staggering. Since September, Stephen Ross of Related Companies, Michael Fascitelli of Vornado Realty Trust, Mort Zuckerman of Boston Properties, Larry Silverstein of Silverstein Properties and Bruce Ratner of Forest City Ratner have all announced their resignations from their current roles.
While all will stay involved with their respective companies in one form or another, the changing of the guard in New York real estate has been in full swing.
Below, The Commercial Observer highlights each of these men—and their replacements—along with the one that started the recent trend, Douglas Durst.
From the outside, 222 Broadway fits the stereotype of the Downtown financial office tower.
But when Bank of America downsized, leaving roughly 250,000 square feet of space vacant, a series of tours guided by its new owner, L&L Holdings, quickly blasted that stereotype away.
Condé Nast committed to 80,000 square feet at the tower in early March. WeWork, which provides collaborative workspace for tech and media companies, was next in line.
Larry Silverstein, the affable face of Silverstein Properties and the man behind the redevelopment of the World Trade Center, is stepping down as CEO – the latest of a string of high-profile real estate CEOs to step down this year.
The co-chief executive at the firm, Mr. Silvertein’s heir apparent, Marty Burger, who joined in 2010 as executive vice president after 15 years with Related Companies, will succeed Mr. Silverstein, The Wall Street Journal reported. Mr. Silverstein will stay on as chairman.
“Marty is a terrific young guy, and his function is really going to be to grow the company,” the 81-year-old real estate icon, Mr. Silverstein, told the Journal.
Did you ever uncover that your grandmother had numerous “favorite” grandchildren, or that your brother or sister was earning a bigger allowance?
If so, you might have felt like the city’s mayoral candidates as they come to realize that they might not be so special in the eyes of some real estate executives.
An article published in the New York Daily News shows that some real estate executives are throwing cash at more than one mayoral candidate in what critics believe is an attempt to butter up the next mayor – whoever it may be – to better suit their interests.
“Critics say it’s proof that some donors are not supporting a vision for the city — they just want a sympathetic ear from whoever wins,” the report stated.
Everybody Go Downtown
After the storm, things are looking brighter for the lower Manhattan real estate market.
Even with construction scaffolds clogging the district’s narrow streets in a reminder of Hurricane Sandy’s devastation, Downtown office leasing activity jumped 73 percent in the first two months of the year, according to Cushman & Wakefield.
When it comes to succession plans, real estate insiders start reading the tea leaves early. After Martin Burger was tapped as Silverstein Properties’ co-chief executive in December 2011, Mr. Burger told The Commercial Observer that the company’s larger-than-life chief executive, Larry Silverstein, now 81, had “already made the decision” during conversations between the colleagues two years prior.
“I don’t think Larry’s ever going to retire,” Mr. Burger added. “He’s a force of nature.”
The prescience among real estate dynasts to plan ahead often collides with their desire to remain in control as long as they can, real estate titans and accountants acknowledge.
“Real estate companies do organize, but what I see there as opposed to in other industries is more of the people staying involved a lot longer,” said Rob Gilman, a partner at the accounting firm Anchin, Block & Anchin LLP. “In other businesses, people retire at 65 years old. The matriarch or patriarch of a lot of these real estate families stays on well into her or his 70s.”
More than 300 real estate professionals crowded the Metropolitan Club early Thursday morning, despite snow-covered sidewalks, for the Observer Media Group’s third annual Masters of Real Estate forum.
Sponsored by Fried Frank and Marks Paneth & Shron, the event drew boldface names like Larry Silverstein and Mortimer Zuckerman, who spoke about the devastation wrought by Sandy, not to mention financiers like Angelo Gordon & Co.’s Adam Schwartz and Rockpoint Group’s Keith Gelb, who weighed in on opportunistic investments.
Below, reporter Al Barbarino walks the room and listens in on the panels, striving to put his finger on the commercial real estate industry’s pulse, minute by minute.
Post-Tropical Storm Sandy
Silverstein Properties reopened 120 Wall Street Wednesday morning for the first time since Hurricane Sandy flooded the 600,000-square-foot building’s basement and damaged electrical distribution equipment.
The company pumped more than one million gallons of water out from the building’s basement and removed contaminants before methodically checking all base systems to get them back up and running, Jeremy Moss, the firm’s vice president of leasing told The Commercial Observer.
“Since the storm we’ve been working around the clock to get the building up and running and to bring tenants back – we succeeded this morning at 8 a.m,” Mr. Moss said.
It could be up to a year before the New York Daily News and U.S. News & World Report are allowed back into their 4 New York Plaza headquarters, which were “wiped out” by Hurricane Sandy, Mortimer B. Zuckerman said today.
Like many companies in Lower Manhattan, both publications were forced to relocate after 11-foot tidal surges caused flooding and electrical outages in the area.
“We have just leased some other space for nine months to a year just to make sure that we can keep the magazine and the newspaper going,” the chairman of Boston Properties said at the Observer Media Group‘s Masters of Real Estate conference. “We suffered dramatically on the publishing side because the U.S. News and the Daily News offices were at the southernmost part of Manhattan and their offices were just destroyed.”
Hip hop impresario Jay-Z kicked off the opening of Forest City Ratner’s Barclays Center with a series of eight sold-out concerts last week. And while thousands of rap and pop music fans descended on Brooklyn to welcome Hova back to his native borough, more surprising, perhaps, were the boldface real estate titans who lined up as guests of Bruce Ratner to witness the spectacle. Besides Dan Tishman of Tishman Construction and Vornado Realty Trust’s Michael Fascitelli and Steven Roth, Mary Ann Tighe of CBRE described the evening as electric. “The only Jay-Z song I recognized is his New York song, which he performed early in the show,” wrote Ms. Tighe, who added in an email to The Commercial Observer that she also enjoyed the arena’s menu of Brooklyn-based restaurants. “Best arena/stadium food ever,” she wrote.
Perhaps the one attendee who was most impressed with the Barclays Center and its booming sound system, however, was Larry Silverstein, the iconic developer behind the ongoing redevelopment of the World Trade Center. Mr. Silverstein revealed his first impressions of the Barclays Center with The Commercial Observer and shared his opinions on Jay-Z and the venue’s body-shaking bass system.
The Commercial Observer: So a tipster told us they saw you at the Jay-Z show last Friday.
Mr. Silverstein: We attended the concert Friday night, and it was a transformational experience.
2012 Owners Magazine
As a pair of 26-foot steel beams were hoisted high above Manhattan on April 30, the crowd below spoke of resilience, hope and remembrance.
One World Trade Center had just hit a height of 1,271 feet, making it the city’s tallest building. Port Authority Executive Director Pat Foye said in a press conference that the building will “anchor Lower Manhattan and its rebirth for many generations to come.”
But tourists and tristate residents aren’t the only ones noticing the change in the city skyline. A number of commercial property owners are looking to the tower and other developments as a hopeful bellwether for the future, despite what most analysts still describe as a stagnant market.
The numbers speak for themselves. Real estate brokers leased 12.9 million square feet through July 31, 2012, a 28 percent drop from the 17.9 million square feet inked during the same period in 2011, according to a CBRE report. Vacancy sat at 7.5 percent, no change from a year earlier.
Rob Speyer will be the Real Estate Board of New York’s next chairman, the powerful professional association and lobbying group announced this afternoon.
Mr. Speyer, the president and co-CEO of the real estate investment firm Tishman Speyer, will take the position in January when the current chairwoman, Mary Ann Tighe, steps down.
During a ski trip to Colorado several months ago, Michael May, an executive at Cantor Fitzgerald, remembers his eagerness to hit the slopes. He rose at the crack of dawn and found his friend Marty Burger, who had organized the trip, waiting in the lodge with the same idea in mind.
Traveling with a large group of executives, they skied all day. Mr. May remembers being exhausted, but Mr. Burger convinced him to join him and few others for some indoor tennis back at the hotel. A couple of games, at Mr. Burger’s urging, turned into a couple of sets.
While leasing activity for much of New York City in the past few months has been more lackluster than blockbuster, a sizable chunk of available space –sizable in the, say, 6 million square foot range– is on the cusp of hitting the market, The Wall Street Journal reports.
New developments like 1 World Trade Center, 4 World Trade Center, and Edward Minskoff’s 51 Astor Place, are all slated to hit the market in 2013. The last time NYC had this much new space becoming available was in 1989, said Cassidy Turley’s Robert Sammons.