The Giving Tree
Last month, Stephen Ross gave $200 million to the University of Michigan, a donation that should redefine his alma mater’s business school and athletic campus.
The Related Companies chairman and founder’s gesture was among the largest recent donations by a New York real estate industry bigwig and the single biggest donation in the Ann Arbor school’s history. But local property owners bestow more than glass and concrete towers on the city, their civic munificence a counterweight against what some people consider collective, overriding greed.
In reviewing recent philanthropic records and speaking to major New York City real estate owners, a picture emerges of an industry primed to give back, particularly to their alma maters, the medical field, children’s organizations, the arts and Jewish foundations. A good deal of charity work is done quietly–one titan of the industry requested anonymity when he spoke to The Commercial Observer–even as the elite Manhattan gala circuit makes philanthropy a pillar of any billionaire’s well-documented social life.
“I think that the industry is extremely generous,” Jeffrey Gural, the chairman of Newmark Grubb Knight Frank, said in a phone interview. “Almost all the people that I know are extremely philanthropic, and I’m proud to be a part of the industry. I’m always asking for money, and, you know, we kind of all give to each other’s [causes].”
Indeed, the industry’s top names have made a laundry list of impressive contributions over the past year or so. Boston Properties Executive Chairman Mortimer Zuckerman pledged $200 million to Columbia University to establish the Mortimer B. Zuckerman Mind Brain Behavior Institute. That gift landed him at No. 6 on The Chronicle of Philanthropy’s “50 Most Generous Donors of 2012” ranking.
Jonathan Gray, the global head of real estate at Blackstone, with his wife, Mindy, donated $25 million last year to their shared alma mater, the University of Pennsylvania, to establish the Basser Research Center. Basser, which is named after Mrs. Gray’s late sister, Faith Basser, will research cancers stemming from hereditary genetic mutations. Mr. Gray also recently donated $10 million to the charter school Harlem Village Academies to help it purchase a new campus building.
Larry Silverstein and his wife gave a combined $10.25 million to Hunter College and New York University last year, contributions that will establish the former’s Student Success Center and the latter’s Silverstein Scholarship Fund for medical school students. “[Mr.] Silverstein is the gold standard,” said one source.
Richard LeFrak may not be far behind: Last year, the chairman of The LeFrak Organization donated $10 million to the American Museum of Natural History, a perennial beneficiary of that real estate dynasty’s largesse.
Circling back to Mr. Ross, and touching on Mr. Gural’s point of reciprocity, the Related boss earlier this year became the latest titan of industry to sign onto the Giving Pledge, a campaign started by Warren Buffett and Bill Gates to prompt the world’s wealthiest people to pledge half of their fortunes to charity. Wolverines still steadying themselves after Mr. Ross’s latest pledge, take note: Forbes estimates his wealth to be $4.8 billion as of this month.
“I think there’s a wide range,” Mr. Gural said when asked what specific charities, or types of charities, propel the most real estate industry giving. His own interests tend toward children and culture. Mr. Gural is a driving force behind the I Have a Dream Foundation, which provides long-term academic support (including college tuition) to 80 children in Manhattan’s Chelsea-Elliot housing project. He’s also the president of the local Starlight chapter, which aids seriously ill youths and their families. His protean gift-giving also included $1 million to the off-Broadway Alliance of Resident Theatres/New York earlier this year.
“Education is important,” Mr. Gural said. “Helping colleges that we all went to is certainly something that a lot of us do. Then there are the arts–we have a heavy influence there as well: Lincoln Center, the Metropolitan [Museum of Art]. I also think Jewish philanthropy is a big part of the industry. A lot of the major players are Jewish. So that’s a part of it.”
In addition to inspiring a good deal of its charitable generosity, the religious bent of the New York real estate industry creates a small schism between those who prefer to donate quietly and those who slap their names across business school campuses, museum wings and Lincoln Center auditoriums. Four of New York’s best-known real estate chairmen–Charles Cohen, Rob Speyer, Richard LeFrak and Bill Rudin–declined to comment for this article.
One representative explained that his client “kept his charity work very low-profile. He doesn’t list or talk about it.”
The tension between public and anonymous donations recalled the Curb Your Enthusiasm episode in which Larry David gives generously to a children’s hospital that names a wing after him. However, at the opening of the wing, his contribution is upstaged by a celebrity who opted for discrete philanthropy. Of course, that celebrity, Ted Danson, told everyone within earshot about his anonymous donation, but Mr. David remained incensed.
“In the Jewish religion, the highest call is to donate anonymously,” Mr. Gural said. “I can’t say that I’ve elected to do it that way. And obviously you see a lot of people’s names on buildings. I think it’s a personal preference.”
A less pious explanation for giving quietly may be reluctance on the part of public donors to be hit up by friends and half the city’s foundations. “It’s interesting,” said a source who for this story requested, yes, anonymity, “I was in the former, [anonymous], camp. But it inevitably becomes public, and I think publicity in the end is a good thing. I hear from younger colleagues who want to be generous because they see this example.”
Another effect–and, frankly, cause of industry generosity–is its attendant social calendar.
“In New York, there’s this system where we’re all involved in charities, and they have galas, and we all buy tickets to each other’s galas,” Mr. Gural said. “New York is probably unique in the number of charities that rely on income from galas–it’s quite high. It creates [this mindset of] you go to mine, I’ll go to yours.”
Many of the A-list charity balls occur in the cultural organizations that prosper thanks in part to plutocratic generosity. Like Mr. Gural, Douglas Durst is a champion of the theater scene and sits on the boards of Primary Stages and the Roundabout Theatre Company (in addition to the Metropolitan Museum of Art and Lincoln Center real estate councils). Mr. Ross is a trustee of Lincoln Center and the Guggenheim Foundation.
Yet despite the high-wattage allure of the event circuit and possibility of a Bill Cunningham caption in The New York Times’s Style section, one notably generous owner and donor insisted, “It’s not about the galas.”
What then, is the motivation–beyond sheer decency–of philanthropy among New York real estate’s heaviest heavy hitters? There’s certainly a sense of noblesse oblige, but one industry leader said it differs slightly from the charitable works of the blue-blood set.
“A lot of real estate leaders are self-made,” a source who grew up in a suburb far from Park Avenue said. “And making that sort of future possible for underprivileged kids is important. You know, there are kids growing up a mile and a half away from mine whose opportunities in Harlem are so limited. There are graduation rates of 6 percent.”
That incentive to give back, unlike the $20,000-per-plate parties, incites day-to-day involvement rather than cutting checks and allows donors to see tangible benefits. The graduation rate at Harlem Village Academies, for instance, is 93 percent. And along with generosity fostered by religion, it contrasts with the popular populist notion of real estate owners wanting to bulk up their own bottom line at the expense of everyone else.
“I’m very proud of the industry,” Mr. Gural said. “We do our share and probably don’t get enough credit for it. But that’s the nature of our business: People love to criticize real estate landlords. But overall, we’re good for the city and have contributed a lot to its success over the past 20 or 30 years.”