Nicholas Bienstock

What was your biggest deal of the last 12 months?

We brought in the Allen Morris Company as a co-general partner to build Pine Grove, a 315-unit ground-up rental apartment project on one of four development sites we assembled in West Palm Beach, Fla., adjacent to our 287-unit Olara condominium on the waterfront — which is under full-scale construction and is up to the 23rd floor! 

We expect to get our HUD financing on Pine Grove in the third quarter of 2027, at which point we will start construction. It is a $175 million project. 

Where are you getting your money? Or, how would you describe your investor base?

At different times we have raised money in different ways from different investors and partners.  

We have been in the fund management business with a broad array of institutional investors; we have done multiple stand-alone JVs with capital partners; we have syndicated deals via a broad friends and family network; and we have raised money for deals through institutional bank distribution platforms.   

Since COVID, many traditional institutional sources of capital have been on the sidelines, so we have closed a number of transactions with large-scale family offices and uber-high-net-worth individuals. We have seen that in the current environment, a smart, super-high-net-worth individual or a small investment committee at a family office can make a counter-cyclical decision to deploy capital, when a big institutional investment committee cannot. 

Having dipped into the Florida market, which do you like better — New York or Florida? 

Florida has tremendous wind at its back. The long-term trends of population growth, transfer of wealthy individuals and productive businesses seeking a lower tax environment, lighter regulation and a favorable climate have been in place for decades, and were put on steroids during COVID.  

Even though the COVID surge is gone, those positive, long-term trends continue, and they are enhanced as Miami and West Palm Beach become much more multi-
dimensional environments.   Forty years ago, Palm Beach was where rich, old people
went to die. That is absolutely no longer the case. As we sell $2 million to $10 million apartments at Olara in West Palm Beach, 60 percent or more of our buyers are coming from New York City or the New York tri-state. They are making the decision to purchase a beautiful apartment in Florida in their 40s or 50s, 20 years earlier than their parents would have made that decision.   

Part of that is that technology has made it much easier for us all to work more flexibly than in the past. It’s easy for a private equity guy or an asset manager in his 50s to work seamlessly a few days a week in New York City and a few days a week in Palm Beach. And they are seeing a community develop of all their New York-area friends and colleagues in West Palm Beach. 

It is also true that Mamdani has certainly helped make that decision easier for many wealthy New Yorkers.

While I love New York and absolutely believe in New York’s fundamental resilience and attractiveness as both as one of the greatest cities in the world and as an attractive real estate investment market, at this moment in time it is easier to attract capital to invest in Florida than New York. Florida’s growth story is simpler and more straightforward. 

Have you made cuts in your portfolio? 

Anyone with a large portfolio of office going into COVID (in New York or across the U.S.) has had some tough years. Savanna is no exception. Over the past three to four years, we completed a number of workouts, and have for the most part stabilized our New York City portfolio.  

As we go into 2027, we are pivoting from defense to offense. But, while we were going through rough times in the past few years in New York, we took the opportunity to dramatically expand our Florida business. We are building $1.3 billion of real estate across 2.3 million square feet in West Palm Beach right now. 

Is the opportunistic window open or closed?

I think many industry participants who have been waiting for the opportunistic window for equity to open in New York have been surprised that it has not been more dramatic and that the distress sale opportunity has not been deeper. While selective assets have been repriced and sold at deep discounts over the past two to three years, the scale of the distress buying opportunity has been smaller than anticipated.  

At the same time, fundamentals in the New York market have been strong. That has allowed many lenders (who have been kicking the can down the road on defaulted loans) a reason to believe that asset pricing will recover to a point where they can get out whole. But persistent higher interest rates and cap rates are putting additional pressure on that thesis. 

More lenders may decide to face the music and sell into the current market at market clearing prices, as we go into 2027. We will see.

Most surprising item in your portfolio?

Recently, Databricks, an AI company that is not generally well known to the average person (with a valuation of $190 billion!), expanded at 5 Bryant Park by 130,000 square feet.

Lightning Round:

Your AI platform of choice? We installed Claude on everyone’s desktops and phones and challenged our team to integrate it into every aspect of our business.

Who would play you in a movie? As a bald guy, I’d say Vin Diesel!

One prompt you’d never give AI. Don’t ask AI for personal advice. That is why we have friends, family and colleagues.

Jalen Brunson or Aaron Judge? Jalen is the MAN! Go Knicks!

“Oppenheimer” or “Odyssey”? “The Odyssey” was good, but if I’m going to chill out with a movie, given all the heavy stuff going on around the world, I’d say keep it light. I’d advocate classics like “Monty Python,” “Groundhog Day,”  “The Princess Bride” or “Ferris Bueller’s Day Off.”

Tom Holland, Andrew Garfield or Tobey Maguire? I loved Tobey’s original Spidey!

Have you ever eaten pizza with a knife and fork? I’m a born-and-raised New Yorker. That is a dumb question.

The most money you’ve ever spent on a hamburger? More than I care to reveal. Restaurant prices are insane.

Bank or non-bank? You need both in your tool kit.

Last book you read? The Master and the Margarita by Mikhail Bulgakov.

Borrowing costs — up or down in 2027? Up.

What was your nickname when you grew up/started out? With the last name Bienstock, I was “Beany” in grade school. .

How long do we have before AI kills us all? If you are a real estate investor and developer, you need a certain baseline of optimism. So I’m going to say never. 

Where’s your secret escape compound? (Think Peter Thiel’s New Zealand Plan B.) My wife and I have a place in a small town in New Hampshire that has not changed much in the past 100 years.