Commercial Observer’s Exclusive Guide to NYC’s Boutique Brokerages
Sure, the CBREs and JLLs of this city command a lot of business. Nobody denies it. But it sometimes feels that the big guys get all of the real estate coverage.
What about the boutique brokerages? The ones that don’t necessarily have hundreds of sales associates on hand, but who will promise a personal relationship with their clients and bathe them in the necessary attention? What of the brokerages of the outer boroughs? What of the ones that know their micro-niche as well as any of the Godzillas of real estate?
It’s difficult to measure the smaller, more modest firms, but the ones we’ve chosen to showcase here (some of whom volunteered their names to us, others we had admired from afar) shared certain important characteristics: determination, expertise, grit. Our only requirement was that Commercial Observer hadn’t featured them in the past, and that they don’t have more than 10 brokers on staff. Here they are, not in any particular order.
Founder: George Halvatzis
Date established: 1988
Number of employees then: 15
Number of employees now: 4
George Halvatzis opened his eponymous brokerage with a crew of 15 in 1988, focusing on both commercial and residential sales and rentals in Queens—since then he has downsized to a cozy four independent contractors who work on commission.
“I never had been more unhappy and never made less money,” when he had a big staff, said the man who has a bachelor’s degree in psychology. “My family owned a real estate office in Astoria and I reluctantly got my license and gave it a try. I have devoted 34 years of my life to mastering this business. I have a personal philosophy that there is always a better way to do something, so I am constantly trying to improve what we do.”
“We are the largest ‘small’ office in Astoria. I don’t consider my office small,” he said. “Per agent, we are one of the most productive offices in our area. An average office has 10 to 20 percent of the agents doing 80 percent of the work.”
At Halvatzis Realty, he said, each agent sees a transaction from beginning to end: properly pricing the unit, effectively marketing it, qualifying purchasers, and dealing with inspectors, attorneys and appraisers. “Even after a transaction is finished, we are always there to provide assistance if it’s needed," Mr. Halvatzis said.
In Astoria, there is generally more residential work than commercial, said Halvatzis' sales person Kim Parshley who on the residential side did an Astoria record, a $5,000 rental. But she has her hand in commercial as well, like a lease she did a couple of months ago for a high-end men's clothing shop moving into a three-level space on Steinway Street and 31st Avenue for $9,250 per month.—S.P.
Wharton Property Advisors
Founder: Ruth Colp-Haber
Date established: 1992
Number of employees then: 1
Number of employees now: 6
When Ruth Colp-Haber established Wharton Property Advisors in 1992, she was a company of one. Now, 23 years later, the team has grown to six, yet Ms. Colp-Haber continues to oversee every transaction, something presidents of larger firms are generally unable to do.
Wharton specializes in high-end, pre-built spaces, mostly in Manhattan. Ms. Colp-Haber has always believed that pre-built, turnkey spaces provide the best value in the market: All of the work has already been done. “The money that would go into construction on the space can instead be given to the tenant in rent concessions,” she said.
Creativity, she said, is an element in her firm’s success. It’s a skill necessary for, say, marketing so-called difficult spaces: unusual layouts; short remaining leases. For example, she said, “I often take big spaces and set up incubators with several small tenants. The goal is to bring in subtenant revenue by hook or by crook.”
Recently Wharton represented The Argentum Group, a private equity firm, in renegotiating their lease for 6,000 square feet at 60 Madison Avenue. The asking rent was $78 per square foot. Last month Wharton closed a deal for a 3,000-square-foot turnkey space in The Empire State Building (350 Fifth Avenue) for Coalition, a financial firm based in the U.K. Asking rent was $62 per square foot. “Small becomes big. You do a good job and you get more work,” she said.
That said, small does not have to become too big to succeed.—S.P.
The Vortex Group
Founders: Scott Grayson and Rick Marek
Date established: October 2002
Number of employees then: 3
Number of employees now: 8
For those who are sucked into the inescapable vortex of finance, The Vortex Group might be the place to get your real estate needs answered.
The Vortex Group focuses on leasing services for banks, financial service corporations, law firms and technology companies. Some of their clients include Credit Suisse, BNP Paribas, Bracewell & Giuliani and Milliken & Company. The firm does not manage any property and hardly handles sales. President and Co-Founder Rick Marek said the firm has handled transactions of anywhere from 3,000 square feet to more than 200,000 square feet.
While somewhat tight-lipped about some of the transactions they’ve done, one can catch glimpses here and there of deals: In 2013, Vortex represented Akerman Senterfitt, a law firm based in Florida, when it picked up a 60,000-square-foot, 12-year lease for the 19th and 20th floors at 666 Fifth Avenue; Mr. Marek and Vortex Co-Founder Scott Grayson also represented private equity, secondary-market specialists, Coller Capital, in signing a 10-year lease in 2012 for 11,542 square feet on the 29th floor of 950 Third Avenue.
Although Mr. Marek said he prefers the benefits of a small boutique brokerage (less infighting for clients and a stronger, more experienced core of brokers), Vortex is focused on growth. But the firm would like to expand to no more than 25 brokers, Mr. Marek said. He plans to be selective in the hiring, preferring to bring in more qualified brokers than a horde of less experienced ones.
“I am talking to a number of people and who are not so happy at the bigger companies and who want to be with a smaller company, where they could have some say,” Mr. Marek said. “One A-plus kind of person would be worth six people. It’s worth waiting for quality people who want to be part of the group.”—Liam La Guerre
Cignature Realty Associates
Founders: Lazer Sternhell and Peter Vanderpool
Date established: April 2009
Number of employees then: 3
Number of employees now: 3
Cignature specializes in multifamily apartment buildings, mixed-use properties and commercial buildings in the New York metropolitan area, with a strong emphasis on Upper Manhattan. “We like the stability of the residential multifamily sector because the need for housing always outweighs the available housing stock in New York City,” said Lazer Sternhell, the chief executive officer of Cignature.
When Mr. Sternhell opened Cignature six years ago with Peter Vanderpool, its president, they were a team of three, an employee count that has not changed. (The firm declined to name its third employee.) “Being a small firm allows the principals to focus on each and every client and each deal to maintain the highest level of service,” said Mr. Sternhell. “In order to maintain an intense focus on our clients’ needs, we are looking to expand our sales team modestly, but intend to maintain the firm as a boutique so we can continue to offer the best representation in the industry.”
At the end of 2014, Cignature represented both seller (unidentified) and buyer (Acuity Capital Partners, a Chicago-based investment firm) in a $30 million sale/purchase of six Upper Manhattan buildings. In April, again representing seller (Sugar Hill Capital) and buyer (Galil Management), Cignature closed the $25.5 million sale of 3621 Broadway, a six-story, 65,050-square-foot building with 31,175 square feet of air rights.
“The core of our success comes not only from understanding that the New York market is unlike any in the world, but also from knowing that each client’s needs is important and unique,” said Mr. Sternhell.—Sara Pepitone
Isaacs and Company
Founder: Joel Isaacs Date established: 1991 Number of employees then: 1 Number of employees now: 10
Just making our cut-off in staff count, Isaacs and Company is a firm of 10 representing fashion industry and high-profile brand tenants across the U.S. and Canada. Founder and President Joel Isaacs is a man who takes his Lanvin and Prada seriously, offering brand intel that extends from general research to personal experience (his suits).
The firm’s deals read like a Fashion Week dance card. Through the years they’ve been responsible for bringing big brands like Balenciaga, Byredo, Céline, Moschino, Saint Laurent and Stella McCartney to Soho. They leased 60,000 square feet of office space to Michael Kors, and located 12 Prada stores around the country, including the purchase of its 125,000-square-foot office at 609 West 51st Street. Giorgio Armani has been another key relationship for Isaacs and Company, with many deals completed around the country. A spokesperson for the company did not provide additional details.
Currently Isaacs and Company is working on another fashion-related, undisclosed, lease now, expected to close in two weeks.
Mr. Isaacs said his firm’s strength lies in the cohesiveness of his team. Looking ahead, the company will increase its landlord work. It represents brands that landlords want in their properties, he said.—S.P.
Pink Stone Realty
Founders: Michael Segerman and Richard Ohebshalom
Date established: 2010
Number of employees it started with: 2
Number of brokers currently: 10
What started as just two brokers five years ago has increased five-fold—and now Pink Stone Realty wants to broaden its services: They’re talking about starting to develop their own properties.
Pink Stone boasts listings on half-a-million square feet of space throughout the city, said Michael Segerman, the co-founder and managing director of the brokerage. On the commercial side, the firm represents at least 10 office buildings, including 363 Seventh Avenue and 224 East 54th Street. Based in Midtown with a second office set to open at 315 Spring Street, Pink Stone handles leasing and sales for both commercial and residential properties.
In February, the firm represented Japan-based Kobe Bussan in its purchase of a hotel development site at 439-443 West 54th Street for $19.6 million, as CO previously reported. (Mr. Segerman declined to provide the name of the buyer.)
The up-and-coming brokerage’s next move is to grow a development wing while simultaneously building up the sales team. “We’re a full-service company,” Mr. Segerman said. “Our leasing is strong. We’re trying to ramp up our investment sales and our residential sales. We’re looking to expand our brokerage business while expanding new development and opportunity.”—T.C.
Founders: Jack Cohen and Elie Reiss Date established: 2013 Number of employees then: 2 Number of employees now: 6
“We’ve grown the company organically through our clients’ referrals,” said Elie Reiss, a partner at Skylight Leasing, which specializes in leasing space to tech and media companies. “The more we worked in the tech and media sub-sectors, the more we were connected with companies that sought our explicit expertise in the marketplace for creative-type spaces. And that has snowballed since our inception.”
Mr. Reiss and partner Jack Cohen were a team of two when they launched the firm less than two years ago. Today they are six. “We are selective with how we grow,” said Mr. Reiss. (Disclosure: Mr. Reiss is married to Commercial Observer Associate Publisher Robyn Reiss.) “We are not looking to take on as many brokers as possible just to see what sticks. As a boutique firm, the lead brokers of the company are able to give attention to every deal that comes through our door. That’s very important to us and our junior agents, and we want to keep it that way.”
Skylight has forged close relationships with landlords and landlord representatives in Union Square, the Flatiron District, NoMad and Soho (the firm’s primary focus areas) because they are so active, he added. “As our clients grow in size, they recognize more and more that the landlord-tenant relationship is truly a partnership. When we bring our tenants to certain buildings, we view it as making a business introduction.”
Early this year Skylight helped Hightower, a cloud and mobile commercial leasing platform provider, sign a five-year lease for the entire third floor at 176 Grand Street. The asking price was $64 per square foot. In December 2013 Skylight represented NewsCred, a content marketing and syndication platform, in signing an eight-year lease for 13,121 square feet over the entire sixth floor at 386 Park Avenue South. Expansion rights were part of the deal. This spring the expansion rights were exercised. The tech company now occupies 26,242 square feet on the fifth and sixth floors—an internal staircase will be complete within days.—S.P.
Kinneret Group Founders: Ethan Ambalu and Ben Srour Date established: March 2015 Number of employees then: 2 Number of employees now: 5
This time next year Kinneret Group may double in size, to 10, but the four-month-old firm has no set number, intending instead to grow organically. “We’re not looking to be the next big public offering. At this size we can offer tailor-made solutions for each client,” said Ben Srour, co-founder and executive director at Kinneret.
Currently Mr. Srour and his partner Ethan Ambalu, senior managing director, are working with Parigi Group, a fashion apparel company (DKNY, Nicole Miller, Roxy) headquartered at 112 West 34th Street, assisting it as it expands and possibly relocates. Tenant representation is Kinneret’s focus. “We’re really honed in and zoned in to that niche,” said Mr. Srour. The firm aims to align a client’s business goals with real estate needs, and be its true advocate when it comes to signing a lease. Representing both sides in a lease agreement can blur the negotiation.
Hyper-specialization aside, what further separates Kinneret from the boutique pack is age. Mr. Srour is 24 and Mr. Ambalu is 23 (they both started in real estate when they were teenagers), and they seek and train 18- and 19-year-olds who arrive as open-minded as one can be. “We put a phone in their hand, a business card in their pocket and offer a training guide that allows them to get up to speed quickly,” said Mr. Srour, who estimates that with Kinneret, the learning curve is shortened to two or three months instead of a year.
“We have a different personality. You probably don’t think young, hip, skinny ties when you think real estate, but that’s who we are.”—Sara Pepitone
The Collective Companies
Founder: Alex Racioppi
Director of Real Estate: Yanni Marmarou
Date established: 2012; Real estate division: 2015 Number of employees then: 3 Number of employees now: 8
When Alex Racioppi opened The Collective Companies, a provider of back-office solutions for food and beverage businesses, his plan was to “develop a solution that could help operators make wiser decisions for planning their overall business strategy.” That was 2012, in L.A.
Three years, a New York City office and six additional employees later (up to eight from three), Mr. Racioppi added real estate to the firm’s offerings. “Our clients view us as a solutions provider rather than a traditional brokerage firm,” said Yanni Marmarou, the director of real estate. “It’s much different than a standard real estate firm that can only provide market data on comparable rents or building sales. We are able to provide much more useful data, specifically relating to hospitality retail sales and operational costs, which traditional brokerage firms simply lack.”
The backbone of The Collective Companies is a proprietary technology platform. “By having a group of clients that are all specific to the hospitality sector, we are able to provide new and existing clients with analytical data that helps them carefully plan out their overall business and real estate strategies,” said Mr. Marmarou, who started his position in May.
The firm is working on the New York City expansion of two quick-service restaurant brands—Indikitch and Mirage Kitchen—and helping a juice/lifestyle brand get going here, too. Details cannot be disclosed at this time.—S.P.
Millennium Realty Group
Founder: Marc Kritzer
Date established: 1985
Number of employees then: 2
Number of employees now: 8
Looking to settle into or getting booted from the Garment District? Grab Marc Kritzer as he walks around the neighborhood and he’ll likely find you a spot.
In the 30 years since he founded Millennium Realty Group, Mr. Kritzer and his staff have focused almost exclusively on the pocket of Midtown running from West 34th to West 42nd Streets. The brokers have seen the area change over the years, and its founder said brokers are adapting to the changing times. “We know the moves before they happen in this particular area,” Mr. Kritzer told CO.
Recent deals include representing coworking-space company AlleyNYC in its 36,000-square-foot space at 119-125 West 24th Street in the Flatiron District. And last September, Millennium arranged for prom dressmaker Promgirl to lease a 14,000-square-foot showroom at 1441 Broadway.
As your traditional Garment District tenants take their spools of fabric and head elsewhere, Millennium Realty Group has been shifting its focus more toward retailers. Millennium brokers had a solid start by bringing Nygard International into a 2,600-square-foot retail spot at 1431 Broadway in 2009.
“We’re changing the direction of our firm,” Mr. Kritzer said. “It’s just like in any business: sometimes it changes. The Garment Center isn’t what it used to be.”—Terence Cullen