Sunday Summary: Back Off, Man. I’m a Financier.


Forty years ago this June a little movie was released starring Bill Murray, Dan Aykroyd, Harold Ramis and Ernie Hudson called Ghostbusters. It was more than just a hit —— it was the basis for a cult.

We loved the wiseacre scientist Peter Venkman (Murray) who dryly tossed off reassurances like “You’re not gonna lose the house — everybody has three mortgages nowadays.” We loved the clinical, nerdy Egon Spengler (“Print is dead.”) We loved gritty New York City in the 1980s, whether it was infested by ghosts or not.

SEE ALSO: Brookfield’s Head of CRE Debt Andrea Balkan Exiting Firm at End of 2024

But we always reserved a soft spot in our hearts for superdork Ray Stantz (Aykroyd). He was neither a total clown, nor a total nerd. (Even if he was closer to the latter.) And among our favorite moments was, when he was tasked with facing down the evil Gozer, he began his pitch saying:

As a duly designated representative of the city, county and state of New York, I order you to cease any and all supernatural activity and return forthwith to your place of origin or to the nearest convenient parallel dimension.”

It didn’t quite get the point across to an interdimensional ghoul (there was a subsequent battle for the fate of the universe that was nearly lost) but we admired the officialdom; the coolness under pressure; the reliance on law, order and procedure.

Remarkably, did we feel that same rush of feeling again last week among New York lawmakers?

After weeks of squabbling the state enacted a $237 billion budget!

Not only does it attempt to deal with the migrant crisis, not only does it shovel money at Medicaid increases, and not only does it save $19 billion for a “rainy day” fund, but it includes a “transformative” housing proposal.

Gov. Kathy Hochul’s plan will encourage office-to-residential conversions through tax abatements, roll back tenant protections on rent-stabilized housing (while at the same time adding new regulations to keep rents low), and extend development incentives for developers that expired under 421a.

And a number of developers are already getting excited about the prospect.

“That’ll take a little time to ramp up, but in the last 24 hours I’ve already had many conversations with people who could use the extension to easily produce thousands of units if they can get financing and resume construction,” said Daniel Bernstein of Rosenberg & Estis. If successful, some 33,000 new units of planned housing could be revived.

And no one should overlook the possibilities of an office-to-residential boom.

“The conversion piece hit right in terms of enabling people to do it and do it quickly,” said RXR’s Scott Rechler. “It gave an incentive to get it done before 2026, so people are moving at a faster pace right now.”

On an investors call, SL Green (SLG)’s Marc Holliday said the change could open up millions of square feet to conversion.

And, while the deal was no doubt in the works long before last week’s announcement, perhaps some — like, say, Brooklyn-based Bushburg — anticipated something good in the works re: conversions. They just purchased the 1.2 million-square-foot 80 Pine Street from Rudin Management with an eye toward conversion.

Governor, did you just save the homes of millions of registered voters?

Victory party

If Gov. Hochul did, we would advise her to take the victory party to Jean-Georges Vongerichten’s Four Twenty Five in L&L Holding Company’s swank new luxury building 425 Park Avenue, which has a sleek design by Sir Norman Foster.

CO got a peek inside the David Rockwell-designed restaurant that features laudables such as a bakery, a wine cellar, a refrigerated chocolate room, a 6,000-pound Molteni oven (handmade in France, no less!) and a $34 cheeseburger at lunch.

Food was a little on our brain this week. The famed Miami-beach born Italian bakery, Rosetta Bakery, announced a new location in Midtown Miami at The Standard Residences, which is a speakeasy.

Of course, Rosetta doesn’t have as many locations as Pura Vida, the cafe that’s become a South Florida institution with 22 spots since it opened its first in 2012 — and we learned from an interview with founders Omer and Jennifer Horev that more are on the way, including a 6,000-square-footer that will be its flagship in Coconut Grove and a new location on Fisher Island.

We hope Rosetta and Pura Vida are also looking in West Palm Beach. Related Companies just scored the approvals for their new $300 million hotel — we can only assume that’ll mean a lot of new food and beverage!

OK, so? The week was a dog

Well, it wasn’t a great week for WeWork. Some of its obligees are arguing with each other in court over selling the coworking company. Given that the company has essentially missed all of its restructuring milestones, some of its unsecured creditors are urging the company to even consider selling to its infamous co-founder Adam Neumann.

At the same time, WeWork was politely asked by its landlord, CoStar, to poop or get off the pot in terms of the lease they have an option of continuing at 1201 Wilson Avenue in Rosslyn, Va. (Hey, at least not all flex office companies had a bad week. Industrious is doubling its space at 860 Broadway.)

It also wasn’t a great week for Brookfield. The $145 million distress sale of 777 Tower in Downtown L.A. has apparently hit the skids even though it was being sold at a deep discount.

But deep discounts abound these days. Izek Shomof’s The Shomof Group just purchased the former Union Oil headquarters (also in Downtown L.A.) for $20.5 million — which was 47 percent less than what its seller (The Swig Company) paid for it back in 2011.

Human sacrifice, dogs and cats living together, mass hysteria

Yes, obviously it was a busy week (we didn’t even mention KKR’s $1.6 billion student housing buy or ACORE’s new $1.4 billion credit facility for distressed capital) but the big finale around CO’s offices was the release of one of our signature issues of the year: Power Finance!

As you might have guessed by now, we were in a kinda Ghostbusters spirit for this one (get it — spirit?) given that the markets still seem spooked (yuk yuk!!) in terms of lending and financing.

And, yes, some of these market forces reminded us of a 100-foot marshmallow man running amok through Gotham.

We always look at this kind of list as our view of the landscape: Who’s on top and why? The 50 different writeups are worth a long, leisurely perusal on this day of rest (as well as calls of congratulations to those financiers you know, and angry voicemails on the machines of your humble CO journalists if you didn’t make it this year).

And, while you’re at it, it certainly wouldn’t hurt to delve into our sidebars that ranged from a deep dive into one of our honorees, Miriam Wheeler and her team from Goldman Sachs, to how the successful lenders are the ones who have been pivoting (or “crossing the streams” contrary to Egon’s initial advice), to some of the new clients lenders have had to source (picture the moment the EPA shuts off the containment unit), to the alternative lenders who have stepped into the void left by traditional sources (yes, there are alternative Ghosbusters, too), and asset management’s fraught relationship with loan modification (which is a little like fine tuning a stubborn Ecto 1.)

Have a wonderful Sunday — see you next week!