Tom Acitelli Dec. 14, 2009, 3:14 p.m.
In recent years, the Forbes family sold its palace in Tangiers, its island near Fiji, its copy of the Gettysburg Address and many of its Fabergé eggs. Its notable Fifth Avenue building may be next.
In June, New York Times’ media columnist David Carr lamented that “if there ever was a bad time to be named Forbes—and there probably is not—now might qualify.” The family that built its fortune on the magazine most synonymous with laissez-faire capitalism may be experiencing its failure firsthand. Not only is publishing possibly at a nadir, Forbes magazine’s lifestyles-of-the-utterly-rich editorial angle no longer has much mass appeal. The family yacht, The Highlander, in honor of the Forbeses’ Scottish roots, has been docked in Miami indefinitely.
After first hitting the market in 2007, the Forbes building, at 60 Fifth Avenue, is rumored to be on the block again, this time at a fraction of the price. The original listing was at $140 million; then there was a deal that went sour rumored to be for $120 million. The New York Post now projects a sale for $55 million, which Forbes’ spokeswoman Monie Begley adamantly denies.
MARK EDMISTON OF AdMedia Partners, quoted in The Times article, says that Forbes, deductively valued at $750 million, is “not worth half of that now.” In 2007, the Forbes family sold 40 percent of the company to private-equity firm Elevation Partners (in which Bono is an investor), forming Forbes Media.
B.C. Forbes, the magazine’s founder, started out as a financial columnist for a Hearst paper. He started the magazine, Forbes: Devoted to Doers and Doings, in 1917. The company managed to scrape through the Great Depression, with Forbes paying all employees on his columnist’s salary; and, in 1962, the company bought 60 Fifth Avenue from Macmillan Publishers. The neighborhood was a gamble at the time, as it was still largely residential and publishing companies were increasingly moving to midtown.
Forbes had earned his wealth the American way, so his magazine promoted his lifestyle, both editorially and financially (the Forbes fortune comes from publishing). The building was just a minor jewel in a fantastic portfolio of investments that came to include art, planes, boats, rarities and, of course, the island, where Malcolm Forbes’ ashes were buried. The magazine and the family’s Boeing 727 were both known as “The Capitalist Tool.”
Forbes made the building its headquarters in 1965, when Macmillan moved to its new spot on 54th and Third Avenue. Fully completed by 1926, the site had been a private residence before Macmillan bought it in 1915. The book publisher moved into 60 Fifth from the building next door, which now houses the New School, and leased that address, according to a Times article from that time.
The building, which has been called “squat,” is a sturdy eight floors of granite whose identity is now inextricable from that of the magazine, and of the Forbes family. All floors are occupied by Forbes Media. Malcolm Forbes, who pushed the company to the height of its success, used to hold forth in the building’s subterranean wine cellar, appraising the business pitches of various chief executives.
The basement of the building still houses the (now waning) collection of antiquities, and is open to the public for viewing. The basement gallery is like a grand yet somehow quaint homage to an early 20th-century boyhood. Music reminiscent of a public television special documenting great change in America plays on a loop, and hundreds and hundreds of toy soldiers are on display, some on moving enclosures, making them appear as though they are fighting with what we would now call the Native American figurines.
There is also a custom-made Monopoly set, aptly renamed “Oligopoly.” The game, a gift from family friends to Malcolm Forbes, features properties and other objects of wealth owned by the Forbeses. The cards read “White Lamborghini,” “Highlander” and “Forbes building.”
IN 2007, WHEN 104 Fifth sold for $110 million, or $458 per square foot, the hope from Cushman & Wakefield, which Forbes retained at the time, was that 60 Fifth itself would command about $1,000 per square foot. But as the market waned, Forbes lost its resolve. Barcelona-based investor Renta SA put down a deposit in mid-2007, grabbing the building for $120 million, according to Crain’s. But Renta bailed, abandoning a deposit for 60 Fifth and many other Manhattan properties. “It’s like a guerrilla war. It is a face-to-face fight every day. … We probably selected the worst moment to come [to New York City],” said Renta’s U.S. director, Eduardo Rabassa, at the time.
Meanwhile, the magazine, known for lists such as “The Hottest Billionaire Heiresses,” “Top Topless Beaches” and “America’s Drunkest Cities,” may move uptown. There is reportedly a social chasm between the magazine and the successful but perhaps overhyped Forbes.com. The rumor earlier this year was that the print magazine might be moved up to the shoddier Forbes.com newsroom at 90 Fifth, and the pricier Forbes building unloaded.
That didn’t happen, but it may yet; Forbes is quiet on the subject, perhaps due to the scrutiny of the company’s finances that other sales talk has prompted. Forbes did not return calls or emails for this story. Gossip blog Gawker joked earlier this year that, with their art collection diminished, Forbes was now auctioning off Forbes brothers. “Initial speculation favored Christopher, ‘Kip’ Forbes … A number of Middle Eastern buyers are believed to be interested in the still-boyish executive.”
Earlier this month, the Post’s Lois Weiss reported that the building was set to sell for $55 million, with a year of leaseback, and that the unknown buyer might flip the contract for another $2 million, according to an unnamed source close to the matter. Earlier in the year, Forbes had “insisted on not getting a penny less than $80 million for the property, which would have come with an agreement for a three-year leaseback at a rent of $3 million a year,” Ms. Weiss reported. Class A office space in the area is leasing at about $49 a square foot on average, according to Cushman & Wakefield’s most recent market report.
Perhaps holding on to 60 Fifth was a sound strategy; the building may yet prove to be a “Capitalist Tool.” Fran Lebowitz, a friend of two generations of Forbes men, may have said it best when she told The Times’ Mr. Carr that “every American believes that they are the impending rich, and that’s not about to change.”
And so there may be a continuing thirst for lists like “World’s Most Expensive Islands,” which would allow the Forbeses to retain their assets, not the least of which is the building named for them.