Michael T. Cohen

Are you going to buy in `25? If so, what asset class?

We plan to continue buying office product. We think generationally. We are motivated in the current market mainly from our timing perspective. We’ll be looking to take advantage of this current pricing cycle by investing in distressed assets that we expect will have significant upside as the market recovers. We plan to take advantage of the return of cash-flow buying opportunities, investments that are no longer driven by internal rate of return but by return on investment.

This window of opportunity won’t stay open for very long. And we are going to stick to our knitting by investing in the asset class we know best — the A’s of the B’s located in neighborhoods with the broadest possible appeal to tenants and industries. We are believers in the live-work-play environments like Flatiron and NoMad. They are where our roots are, where our portfolio was historically built.

Is there a single “good” sign you see in a distressed property that makes you want to buy it?

The litmus test is: Is there demand for this type of product in this location? If the answer is yes, then you can work with pricing, and invest capital with the hope of attracting tenants and stabilizing the property. Unfortunately, there are many assets and locations right now where the answer is: Not really.

What real estate or tax policy would you like to see from a Trump administration?

We need to see a return to the kind of subsidies that supported massive multifamily housing projects in the 1960s and 1970s like the Mitchell-Lama program, Section 8 vouchers, or something new. All three levels of government — federal, state, city — need to get serious about financing low- and-moderate-income housing.

Let’s talk about office. Is the worst over?

Yes. Having worked through multiple cycles across more than 40 years in the business, I can say the signs are all here that the worst is behind us.

Let’s talk about retail. What’s the kind of tenant you want?

The answer is very dependent upon the building and location. Everybody loves food, and good food becomes an amenity for the building. Our portfolio is full of food options, including Starbucks, Mangia and Quality Italian, among others. The tenants love it. As landlords seeking tenants, we love good credit and good operators.

What’s going to be your biggest expense in 2025?

Interest expense. We’re all hoping for rates to continue coming down, and they can’t come down fast enough.

How’s the financing climate for new development and redevelopment — hot, cold or just right?

When it comes to financing, “CBD office” is still a four-letter word. In spite of that, there is money available to deploy for the acquisition and refinancing of stabilized assets. But it’s much easier right now to get access to financing for new residential development than for office.

What are your predictions for the mayor’s City of Yes, especially given the controversies within the Adams administration?

I enthusiastically support the City of Yes. All of my informed sources tell me that it has momentum and will persist beyond the current administration.

Lightning Round:

Social media of choice?
LinkedIn. It’s informative, and a marketing and business tool all rolled into one.

AI: Helpful in CRE or a fad?
Not a fad, but I have yet to figure out how it’s going to be helpful for me.

Last movie you saw in a theater?
I can’t remember!

You’re going on a six-month expedition into the Amazon rainforest. What’s your last meal before you get on the plane?
Comfort food: steak and onion rings, or spaghetti and meatballs.

Tesla or BMW?
Audi!

Will interest rates be below or above 4 percent on July 1, 2025?
Above. The more pressing question is: When or will they dip to 5?

What are you tired of talking about?
The “supposed” demise of the B office building.