CEO at Silverstein Properties
Tell us about a deal that did NOT go through this year and why it didn’t happen.
We looked at a very large mixed-use development in Bellevue, Wash. Larry Silverstein and I flew out there with our team and met with the owner for two days. After months of bidding and and telling them why we thought we were the best developer for the site, it just went on too long. The owner couldn’t make a decision, so we dropped out.
Have you refinanced anything in 2022? How difficult/easy was it?
We refinanced 7 World Trade Center earlier this year. The building is 97 percent leased, so it went very well. The deal was executed in green bonds, financing instruments that enable capital-raising and investment for new and existing projects with environmental benefits.
There’s a lot of Class B and C office in NYC. If you could lay your hands on them at a really great price, what would you do with them?
We would convert applicable buildings to multifamily. For those that aren’t applicable, we would try to amenitize them and re-lease them as office, if appropriate. And for those that aren’t — we would pass.
What market outside of NYC do you like and why?
We like Philadelphia, Los Angeles, Tampa, Las Vegas and Jersey City. We are also active in Seattle, Salt Lake City and Tempe, Ariz. And we’re looking at something in Huntsville, Ala., right now. You could say we are bullish on the United States!
There’s a midterm election this year. How closely are you following, and do you think the national political climate will have an effect in New York?
I’m following it very closely, but I’m not smart enough to tell you how the national climate will affect New York. Larry and I are both big fans of Gov. Hochul. We think she’s doing a terrific job and wish her well in her election.
How many days per week are you in the office?
Four and a half days a week. For many years, our company has had half-day Fridays year-round.
How many days per week are your tenants in the office?
I would say they’re in the office five days a week, but not all at the same time.
NYC apartment rents have reached never seen levels. How much further can it go? How does the housing squeeze play out?
Well, the occupancies really can’t go any higher, because of natural rollover — you can’t be much higher than 99 percent occupancy. And, at some point, rents are going to plateau, because people can only afford so much. So, we’ve seen incredible rent growth over pre-pandemic rates. They’re probably going to even out pretty shortly, and, then, hopefully, you’ll just have steady growth instead of spiking. There needs to be an incentive for developers to create affordable housing, whether it’s 421a or some replacement. There’s really no incentive right now for creating affordable housing because land prices in New York are so high.
ESG: fad or fixture?
Definitely not a fad, and not just a fixture. We are proud to be environmental pioneers, and have developed some of the healthiest, most energy-efficient, sustainable and climate-friendly buildings in the country. And we’re going to be building 2 World Trade Center as a carbon-neutral building. We are also working on converting existing office buildings to residential, which is responsible adaptive re-use as it does not use new concrete or curtain walls, so the carbon footprint is not increased. We also believe in reinvesting in the neighborhoods in which we operate and supporting those in need. Silverstein Properties is recognized worldwide for the wonderful professionals who work here, as well as our history of treating people fairly and honestly. We expect our people to maintain high ethical standards, and we trust them to always do the right thing. Our reputation took a lifetime to build, and we protect it with care.
“Never bet against New York.” —Larry Silverstein