SL Green’s Ed Piccinich on His Renewed Lease on Life
Billy Gray July 23, 2013, 10 a.m.
Ed Piccinich was 90 feet away from the bomb that rocked the World Trade Center on February 26, 1993.
“Everyone who perished that day worked down the hall from me,” he said in a phone interview. “That day gave me my second lease on life.”
At the time, Mr. Piccinich, now 51 and the executive vice president of property management and construction at SL Green, worked for the Port Authority of New York and New Jersey. During the last four of his 10 years there, he managed the nearly 15-million-square-foot WTC site.
“It was like a bubble,” he said of the city within a city, which he focused on after helping manage the Port Authority’s sprawling network of bridges, tunnels and airport terminals.
Overseeing that mammoth agency’s holdings prepared Mr. Piccinich well for his role at SL Green, the real estate investment trust whose over-30-million-square-foot portfolio makes it New York’s largest commercial landlord. And while he’s witnessed several market bubbles during his time in real estate, Mr. Piccinich’s ascent has mostly coincided with the industry’s.
Take, for example, the evolution of lower Manhattan, a neighborhood that has served as Mr. Piccinich’s career crucible. Since he managed the WTC, the surrounding area has grown into an unlikely residential destination and an increasingly viable retail market, despite weathering two terror attacks and Superstorm Sandy.
“I’m intimately close to that process,” Mr. Piccinich said of the Financial District’s broadening appeal outside of the financial industry. One notable project he’s especially proud of below Canal Street is the partnership between SL Green and Pace University on 180 Broadway, a 220,000-square-foot, 600-bed dorm on the onetime commuter school’s Downtown campus.
The new tower rose from the site of “three dilapidated buildings,” and it grew, Mr. Piccinich said, despite “the typical pushback from neighbors who feared some monstrosity that would stick out like a sore thumb.” Instead, 180 Broadway will distract students from their exam cramming with views of 1 WTC and up Broadway.
Between that building and the nearby 33 Beekman Street, another SL Green-Pace project for a new 30-story dorm, Mr. Piccinich said the company is “creating 1,500 dreams” for the students who’ll live there.
This romantic take on real estate could be interpreted as a plug if it came from a broker. But Mr. Piccinich’s role demands a relationship with buildings that transcends mere dollars and cents.
As a property manager (who won the Real Estate Board of New York’s Executive of the Year Award in May), Mr. Piccinich describes his responsibilities as construction (be it development or redevelopment), operations and underwriting. Of course, financial concerns play key roles in all of those. But the job also concentrates on a real estate portfolio’s less glamorous domains.
“Our sweet spot is taking lobbies and transforming them into what we think is best for a given sector,” Mr. Piccinich said. “When it comes to infrastructure, we not only redesign windows and entrances, but also the back of the house, which people don’t look at until you put a building on the market. That’s the tough part—mechanical equipment, cooling towers. The guts of the building.”
A building’s guts are particularly vulnerable to decay, and one of Mr. Piccinich’s “big three” projects right now is the redevelopment of the Sandy-ravaged 180 Maiden Lane. That $125 million SL Green undertaking, done in conjunction with the Moinian Group—Mr. Piccinich calls partnerships SL Green’s “sweet spot”—is another in a long line of assignments that bond him to lower Manhattan.
But the core of SL Green’s holdings is in Midtown. And earlier this month, the company announced the $220.3 million sale of 333 West 34th Street, a 10-story, 350,000-square-foot tower it purchased in 2007 for $183 million. Major tenants there include the Metropolitan Transportation Authority, Godiva Chocolatier and Sam Ash, the famed music store that leased space there last year after being displaced from West 48th Street.
The $26 million in upgrades Mr. Piccinich oversaw at that building included “a special build-out for when Sam Ash started strumming their guitars.”
While he didn’t get sentimental about the process of losing buildings, Mr. Piccinich extolled the virtues of working for marquee Midtown properties still under SL Green’s umbrella. One key building is 1515 Broadway in Times Square, headquarters of Viacom and a former teenybopper pilgrimage site, when it housed MTV’s Total Request Live studio.
“What you get [at 1515 Broadway] is one of the world’s best-known locations. And what makes it perfect for a Viacom is the chance to demonstrate that you’re operating properly. You have to maintain an asset, given the number of people who pass through, and to make sure you’re not falling victim to the tourists.”
Before its titanic 1.3-million-square-foot lease renewal at the property last year, Viacom was said to be eyeing new spaces in lower Manhattan. Mr. Piccinich said he was unfazed by the rumor mill concerning that and other big transactions.
Ignoring the media hype also may have come in handy during SL Green’s negotiations with the elusive Joe Chetrit during his $1.1 billion acquisition of the Sony Building at 550 Madison Avenue. SL Green ultimately arranged $925 million in financing for Chetrit Group.
“Mysterious or not,” Mr. Piccinich said of Mr. Chetrit, “we felt comfortable making the loan. It was one of the biggest structured finance deals that we’ve done. And we’re rooting for [Chetrit Group].”
SL Green will not be involved in the reported $500 million renovation of the Sony Building. Does Mr. Piccinich wish he could leave his mark there? He “never likes to say no.”
That’s not to say he won’t be keeping busy. One of Mr. Piccinich’s current signature projects is the $125 million redevelopment of 280 Park Avenue. The company will team with Vornado on that overhaul. “It’s always cool to have another cook in the kitchen,” Mr. Piccinich said of SL Green’s numerous joint ventures. “You work with a partner to take these premier addresses and give them the face-lifts they need.”
What will 280 Park Avenue’s makeover entail? Mr. Piccinich said “there will be not be another other lobby like it” once work is completed, leaving the now-dated site with vaulted 20-foot ceilings. “It will light up Park Avenue,” he said. “Our competition in the area—the Seagrams Building, Lever House—won’t be able to compete. We’ll become the envy of Park, no question.”
Looking further into the Grand Central neighborhood’s future, Mr. Piccinich voiced support for the Midtown East rezoning proposal, whose architects last week tried (with limited success) to appease critics with amendments to air rights and mixed-use provisions.
“I’m for that plan,” Mr. Piccinich said. “When you look at Grand Central and the visionary who decided to build this tremendous facility … it’s a work of art. But you can’t assume that every building in the city is world-class. In order for future generations to come [to the neighborhood], we have to make sure that we attract jobs and funding and make improvements in transportation infrastructure. The rezoning is a critical part of that.”
Also on the subject of the future, Mr. Piccinich, who has seen buildings rise, fall, flood and remake themselves, hopes that real estate stays in the family. The Garden State native and father of three already has one daughter who “works for the competition” at CBRE. And he hopes his other two children will enter the business. Meanwhile, he’s trying to convince his wife to move with him from Wyckoff, N.J., to the city.
“I was on the 10-yard line, got sacked and am back midfield,” he said of that negotiation. Whether or not Mr. Piccinich and family take up residence in Manhattan, he said, his role at SL Green has already given him a stake in New York.
“I’ve put my fingertips on the skyline.”