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The Securities and Exchange Commission is suing Cushman & Wakefield’s Kal Bassily, accusing him of defrauding clients while at investor services firm ConvergEx Execution Solutions.

Bassily allegedly engineered a scheme to collect hidden “trading profits” on clients’ securities trades, instructing his fellow traders on how to do so too, and pocketing millions of dollars in bonuses as a reward.He worked at the Midtown-based ConvergEx from Oct. 2006 until he was fired in Sept. 2013. Three months later, the firm agreed to pay $150 million to settle criminal and civil complaints that it overcharged customers, Reuters reported.

“Mr. Bassily acted in good faith by following ConvergEx’s approved business model,” his lawyer Jim Benjamin said in a statement. “He will vigorously defend himself against these charges, and looks forward to his day in court.”

Bassily joined commercial brokerage Massey Knakal as a director of the Capital Services Division in 2014. Cushman paid about $100 million to acquire the firm later that year.

The SEC is seeking to recoup profits and impose fines, along with other penalties. ConvergEx is not named in the U.S. District Court suit. [Reuters] – Ariel Stulberg

Source: Cushman exec sued by SEC for fraud

From the April issue: Richard LeFrak is chairman and CEO of the LeFrak Organization, a company started by his great-grandfather, Aaron, in 1905. LeFrak became president in 1975 and took full control of the firm in 2003 after the death of his father, Samuel. Today, the Manhattan-based business owns more than 40 million square feet of residential, office, retail and hotel properties in New York, Los Angeles, London and Miami. Locally, the LeFrak Organization controls seven Midtown office towers, including 40 West 57th Street and LeFrak City, a massive 20-building apartment complex in Queens. [more]

Source: The Closing: Richard LeFrak

A group of investors led by Jared Kushner and Aby Rosen are reportedly set to lay out $700 million for two of the Jehovah’s Witnesses’ coveted Brooklyn properties.

Kushner Properties, RFR Realty and LIVWRK are in advanced talks to buy the group’s 733,000-square-foot headquarters at 25-30 Columbia Heights in Downtown Brooklyn, known as the Watchtower, and a 135,000-square-foot right site at 85 Jay Street in Dumbo with 1.1 million square feet of as-of development rights, the New York Post reported.

The same joint venture bought a five-building, 1.2 million-square-foot Dumbo portfolio from the Witnesses in 2013, paying $373 million.

The Witnesses are leaving Brooklyn after a century in the borough, with plans to set up a new headquarters in Warwick, NY.

The group is also shopping a seven-story apartment building at 124 Columbia Heights. Cushman & Wakefield’s Bob Knakal is marketing the properties on the Witnesses’ behalf. [NYP] – Ariel Stulberg

Source: Kushner, Rosen to buy Watchtower building, Jay Street site for 0M: report

It’s not easy to backtrack on a statement found in court documents, but Howard Michaels is attempting to do just that about his “legalized crack cocaine” comment about the EB-5 program.

Michaels, who heads the Carlton Group, wrote the phrase in a 2014 email to Michael Shvo, telling the developer he and his partners “would be crazy not to jump on this” to finance their 91-story tower at 125 Greenwich Street.

Shvo, who is developing the 275-unit condominium tower with Davide Bizzi’s Bizzi & Partners and Howard Lorber’s New Valley, heeded the counsel: the developers secured $175 million in mezzanine financing through an EB-5 loan.

Michaels said in a subsequent email that he was “pointing out the virtues of the EB-5 financing,” which he said is low-cost and “creates lots of construction jobs and employment,” the Wall Street Journal reported.

In March, the Carlton Group filed a lawsuit against the developers of 125 Greenwich Street, seeking nearly $4 million worth of unpaid commission.

For its April issue, The Real Deal took an in-depth look at the EB-5 gravy train — from developers to regional centers to banks to the so-called migration agent.

Developers are using the program, which grants foreign investors a U.S. green card in exchange for a $500,000 investment, more than ever. The number of applications for the program climbed to 17,691 in 2015 from 6,554 in 2013, according to U.S. Citizenship and Immigration Services.

On Wednesday, Congress will again look at the program at a hearing of the U.S. Senate Judiciary Committee, the Journal reported. [WSJ] — Dusica Sue Malesevic

Source: EB-5 may be “legalized crack cocaine,” but it creates jobs: Shvo adviser

One man’s trash is another man’s treasure, and a trio of brokers from Newmark Grubb Knight Frank now have the plaques to prove it. The team won a REBNY Ingenious Award for trading a Department of Sanitation site that paved the way for a new medical campus on the Upper East Side.

Mark Weiss, Justin DiMare and Howard Kesseler took home The Henry Hart Rice Award, the Real Estate Board of New York’s top deal-making prize, for their land-swap with the city’s Department of Sanitation, Memorial Sloan-Kettering Cancer Center and Hunter College.

“It all started with an ingenious idea to transform a deserted site with smelly trucks that had been overlooked for decades,” Savills Studley’s Woody Heller, who chairs REBNY’s sales brokers committee, explained Tuesday evening at the committee’s 72nd annual cocktail party at 101 Park Avenue.

The $215 million deal got its start back in 2008, when the sanitation department demolished a truck repository at 525 East 73rd Street with plans to build a new, modern facility. But the city kicked the plan to the curb when the recession hit, and in 2010 the brokers came forward with a proposal to sell the site and use the proceeds to build a facility elsewhere.

But when the New York City Economic Development Corporation issued a request for proposals for the site overlooking the East River, it stipulated it be used for healthcare, education or scientific research – ruling a residential developer out of the question.

The brokers’ solution was to pair Memorial Sloan-Kettering, which had capital to build a new campus, and Hunter College, which had excess real estate that exceeded the city’s requirements for a new sanitation facility.

“The synergy of this partnership was game-changing for all parties involved,” Heller said.

The deal, which was approved in 2011 and closed last year, resulted in a new, 1.1 million-square-foot campus where Hunter will train nurses desperately needed at the hospital.

Weiss, who earlier this year jumped over to Cushman & Wakefield, said the transaction meant more than just dollars and cents.

“At the press conference when the EDC contract was awarded and signed, Mayor Bloomberg put his arm on our shoulders and said, ‘Did you ever think you were going to make a deal and do something in your work that will result in some lives being saved?’” he recounted. “I’m never at a loss for words, and that just took my breath away.”

DiMare said he thought it was a good example of “thoughtful and proactive land-use policy” he hopes will be replicated at the location Hunter swapped with the city at 425 East 25th Street.

Industry heavyweights like Newmark’s Jeffrey Gural, Mary Ann Tighe from CBRE and Peter Hauspurg of Eastern Consolidated mixed and mingled at the 101 Club, where the award winners were selected from a field of 16 submissions.

The second-place Robert T. Lawrence Award went to Lauren Crowley Corrinet, Gregory Tosko and Sacha Zarba of CBRE for LinkedIn’s 44,000-square-foot expansion at the Empire State Building. And Ackman-Ziff Real Estate Group’s Alan Goodkin took home the third-place Edward S. Gordon Award for negotiating construction-financing for developer Jonas Rudofsky’s 160,000-square-foot medical center in East New York that will be home to EmblemHealth.

In the weeks leading up to the awards, The Real Deal reviewed a number of submissions to give an inside look at how some of the city’s most complex deals come to fruition.

(They include David Ash’s retail condo for Zara, Arthur Mirante’s NBPA office lease, Rob Martin’s space swap for Assured Guaranty, Paul Wolf’s 99-year lease on the St. Luke campus in Greenwich Village, Michael Brais’ lease with Gansevoort Market at the Empire Outlets and Singer & Bassuk’s refinancing of TF Cornerstone’s headquarters on Park Avenue South.)

Heller congratulated the winning Newmark brokers for succinctly describing their deal in four pages, while at the same time playfully chiding others who implemented “creative page-design” in order to squeeze the details of their transactions into the maximum limit of ten pages.

“All because the true essence of our transactions can’t possibly be captured in a mere 10 pages,” he said wryly. “Let this be a lesson to all of us.”

Source: Newmark trio takes REBNY award for UES sanitation-site swap

Forest City Ratner and its joint venture partner Greenland Group are shopping around a “very significant” equity stake in a handful of the 15 buildings slated for Pacific Park in Brooklyn, The Real Deal has learned.

Greenland Forest City Partners would use the money raised from the sale of the stake, which includes a 26-story under-construction condominium tower at 615 Dean Street, a planned 277-unit condo next door to the west on Dean Street, and a 750,000-square-foot tower slated for the corner of Sixth and Atlantic avenues, to recapitalize its own investment in the complex. 

The partners have hired CBRE’s Darcy Stacom to market the stake in the three properties. The third building was originally slated to be residential but the partners may opt to develop it as an office tower instead, according to a recent report.

Forest City and Greenland teamed up in 2013 when Greenland, China’s largest developer, acquired a 70 percent stake in the massive Brooklyn project formerly known as Atlantic Yards, though not in the Barclays Center and the project’s first housing tower.

A spokesperson for the partnership declined to comment on the size of the equity stake or the asking price, saying only that the companies “remain fully committed” to developing Pacific Park.

“With 1,800 units of housing under way and thousands more in the pipeline, we’re maintaining significant forward progress in constructing Pacific Park,” a spokesperson said.  “To ensure the most expeditious and effective build out, our joint venture is seeking strategic opportunities to recapitalize our significant equity investment.”

Neither Stacom nor a spokesperson for the New York City Economic Development Corporation, which is overseeing the project, responded to a request for comment.

The move to sell a major stake in some of its Pacific Park developments speaks to a recent trend of Forest City pulling out of higher-risk assets. There’s speculation that the firm, which recently converted to a real estate investment trust, is moving away from its development-driven roots to become more of an operator, thus increasing its liquidity and its appeal to prospective REIT investors.

In November, it sold a development site at 625 Fulton Street in Downtown Brooklyn to Simon Dushinsky’s Rabsky Group for $158 million.

Meanwhile, Greenland’s stock has taken a hit in China in recent months, amid concern that some of the nation’s large cities might introduce greater scrutiny of residential real estate financing.

Source: Forest City, Greenland want to sell big stake in Pacific Park complex

Soho Properties CEO Sharif El-Gamal joined The Real Deal managing web editor Hiten Samtani backstage during last week’s Real Estate Showcase and Forum in Toronto, where he discussed Canadian investment in New York City and details on his 45 Park Place project.

The developer took up his vision for the 70-story Downtown condo tower, and how it will fit into Downtown’s residential landscape.

“I believe Park Place will be dubbed the ‘Park Avenue of the new Downtown,’” he said, before asserting that Tribeca will soon become New York’s hottest neighborhood.

Check out the video above to watch TRD pick El-Gamal’s brain.

For more videos, visit The Real Deal’s YouTube page.

Source: El-Gamal thinks his Tribeca condo tower will be the “Park Avenue” of Downtown: VIDEO

From Luxury Listings NYC: Don’t throw your mason jars filled with artisanal kombucha out your barn door quite yet!

According to a new study from Zillow Digs, listings that mention the words “barn doors” can sell for a 13 percent higher price and 57 days sooner than comparable properties. Other hot words are “shaker cabinet” (which can raise the price 9.6 percent), “farmhouse sink,” (which raises it 7.9 percent) and “subway tile” (which raises it 7.9 percent). [more]

Source: Want to get a higher price for your home? Add barn doors

From the April issue: How many NYC buildings does Shamah Properties own?

We own and manage 25 buildings, which contain more than 1,500 rental units. Twenty of them are in Brooklyn, three are in Washington Heights and two are in East Orange, N.J. We look for affordably priced apartment buildings in working-class neighborhoods. The term “workforce housing” sounds very stripped down, but guess what? We do not own the type of housing in which people don’t have to work. About 98 percent of our portfolio is rent-stabilized. We’re not against buying market-rate units, but when we buy rent-stabilized, we can base the numbers on the fact that there are rent guidelines. [more]

Source: Meet the Landlord: Alan Shamah

A judge dismissed multiple counts in a complaint against the city and several landlords over the lack of accessibility at their apartment buildings, ruling that Public Advocate Letitia James didn’t have the legal standing to sue.

In February 2015, James and the Center for Independence of the Disabled sued the city’s Department of Buildings and the landlords, on behalf of tenants who said the buildings were not adequately accessible for people in disabilities.

However, U.S. District Court Judge Deborah Batts ruled late last month that neither had legal standing, Politico reported.

Since taking office in 2014, James has filed 11 lawsuits, more than any of her predecessors, and has experienced pushback. She has been removed from other lawsuits for lack of standing, and the city’s Law Department is trying to get her removed from other suits she has filed against the city, Politico reported.

Last month, the city settled a federal lawsuit filed by elderly and disabled tenants who said they lost their rent subsidy after family members died and agreed to pay $130,000 to 10 plaintiffs. James and the tenants filed the suit last year over the Department of Finance enacting a rule that changed deadlines for rent freeze programs, such as Senior Citizens Rent Increase Exemption.

James’ “Worst Landlords” list —  it features property owners around the city who have racked up the most violations relative to the number of apartments they own — came under fire when it wrongly included a landlord. [Politico] — Dusica Sue Malesevic

Source: Judge rules Letitia James lacks legal standing in suit against city, landlords

From Luxury Listings NYC: When enjoying a film about a galaxy far, far away, binge-watching Netflix’s “Making a Murderer” or throwing an 80’s-themed karaoke party, New York City luxury homeowners desire state-of-the-art custom screening rooms, which offer privacy and amenities that beat what the typical multiplex can deliver.[more]

Source: Pass the popcorn

Here’s an amenity you don’t find too often in the heart of the West Village: a horse walk. But that is precisely what the townhouse at 336 West 12th Street boasts.

The red brick Italianate house was built in the 1850s and features a tall passageway that leads from the street to a carriage house in its backyard. Listing agents Stan Ponte and Randall Gianopulos of Sotheby’s International Realty told the Wall Street Journal that the passageway was originally used for horses.

The 24-foot-wide house measures about 7,000 square feet and has four bedrooms and an elevator. However, the original carriage house behind the home was replaced with a two-story home office at some point – so you can stop fantasizing about riding your roan through Greenwich Village now.

The property is owned by Lawrence Clark, the chief executive at the Vermont-based fuel technology company, Accordant Energy. He bought the house in 2008 for $11.6 million and has given it a thorough renovation.

One perk he added was a temperature-controlled wine room connecting the carriage house to the main house. Still, a functioning horse stable would have been a far more unique amenity. [WSJ] –Christopher Cameron

Source: For .5M, a “horse walk” in your West Village home

From Luxury Listings NYC: For buyers hoping to sink their teeth into Bran Castle — a mountain-top fortress in Romania that was the inspiration for Bram Stoker’s Count Dracula’s castle. Sadly, the property is not up for sale, despite what you may have heard. [more]

Source: False alarm: You cannot buy Count Dracula’s mountain-top fortress

The whimsical, sculpture-filled park in the center of Nolita isn’t turning into a development site anytime soon. Yesterday, Community Board 2 chair Tobi Bergman confirmed that the city has withdrawn its request for funding to redevelop the Elizabeth Street Garden.

Last year, residents of the neighborhood, organized as Friends of Elizabeth Street Garden, began pushing back against council member Margaret Chin’s plan to build affordable housing on the garden site, between Mott and Elizabeth streets.

And as The Real Deal originally reported, the $50 million that Lend Lease agreed to pay as a settlement over a lawsuit with the troubled Deutsche Bank Building will be used by city and state officials to fund 14 Lower Manhattan projects. The Housing Preservation Corporation had applied for $5 million to construct affordable housing on the site of the community garden, according to Curbed.

However, yesterday’s announcement revealed that the HPD’s application was not included not among the 14 recipients of the settlement money.

“This decision reflects the strength of community support for the garden,” Bergman said. “This same support will eventually lead to failure of any ongoing effort to develop housing there. If HPD decides to pursue a Request for Proposals for the Elizabeth Street site, it will waste its own resources and those of developers who may respond to the RFP without understanding the costs of the fight they will be investing in.”

Still, the garden isn’t safe for good. The HPD has suggested that it would issue an RFP in the spring. [Curbed] –Christopher Cameron

Source: Elizabeth Street Garden is saved, for now

Douglas Elliman’s Joseph Aquino, right-hand man to retail chair Faith Hope Consolo, has been terminated from his position at the company over claims Elliman stiffed him on commissions.

“Mr Aquino was terminated yesterday,” Cindy Salvo, an attorney for Aquino, told The Real Deal. 

The broker’s departure comes just two days after Aquino filed suit against the firm, alleging it improperly deducted over $1 million of his commissions to pay for Consolo’s extravagant personal expenses. Some of his commissions went to pay for his boss’ spa treatments, cashmere sweaters, beauty supplies, and her $100-a-day makeup session, he claimed in the lawsuit, filed Thursday in New York Supreme Court.

Aquino also claimed that when he approached Elliman Chairman Howard Lorber about the commissions, Lorber threatened to “blackball” him from the industry if his complaints continued.

“Douglas Elliman took more than a million dollars in deductions from Mr Aquino over the years while refusing to itemize or provide backup documentation for these deductions, and threatening to terminate him and blackball him in the industry if he complained,” Salvo told TRD Saturday. “Deductions for Consolo’s personal expenses were just a small part of the improper deductions taken from Mr Aquino’s commissions.”

In a statement sent late Friday, Marc Kasowitz, an attorney for Elliman, called the suit “a desperate effort by Mr. Aquino to get an undeserved payday.”

“Mr. Aquino’s alleged statements about Mr. Lorber are equally false, defamatory and desperate,” he said.

A spokesperson for Elliman wasn’t immediately available for comment on the termination.

Source: Joseph Aquino axed by Elliman over Consolo commission dispute

From Luxury Listings NYC: Silver-haired Warhol-hoarder Aby Rosen, 55, is comfortable with controversy. Whether it is uprooting proud New York institutions like the Four Seasons Restaurant or offending well-heeled Old Westbury residents with a 33-foot nude Damien Hirst sculpture on his five-acre estate, Rosen is known to smirk in the face of angry mobs. But with his latest endeavor, Rosen is taking a decidedly less-confrontational tack. [more]

Source: No room for snobs

The Landmarks Preservation Commission unveiled a new interactive map for all protected sites this week.

Discover NYC Landmarks offers a wealth of information — such as location, historical context, site’s architecture and previous owners — for every single designated landmark in the city.

“Now anyone can easily find a wealth of information about our city’s designated landmarks on one convenient online map. The launch of this map is a key milestone in our efforts to ensure that all New Yorkers have the history of our city at their fingertips,” LPC chairperson Meenakshi Srinivasan said in a statement, Curbed reported. [Curbed] — Dusica Sue Malesevic

Source: Landmarks unveils new interactive map for all protected sites

From the March issue: Where do you look for inspiration and insight? If you’re like these industry leaders, the answer, at least on occasion, is books.

This month, The Real Deal polled Megalith Capital’s Phil Watkins, Geto & de Milly’s Michele de Milly and Korman Communities and AKA’s Larry Korman to find out what they’re reading, how the book was recommended to them, and what they’ve found most compelling about it. [more]

Source: What New York real estate pros are reading now

After purchasing the $800 million mortgage for debt on the Plaza Hotel (along with two other properties) last year, billionaire brothers Simon and David Reuben are already moving on.

According to Bloomberg, an auction will be held next month, in which the hotel rooms, restaurants and retail space will be up for sale, along with another luxury property, the Dream Downtown Hotel. The reported foreclosure auction is expected to take place on April 26, and is predicted to fetch more than $1 billion according to industry insiders.

Watch the video above for more on some of landmarked hotel’s recent owners.

For more videos, visit The Real Deal’s YouTube page.

Source: The Plaza Hotel is heading to the auction block: VIDEO

One year after Lend Lease agreed to pay $50 million to settle a lawsuit over the troubled Deutsche Bank Building, city and state officials have announced the funds will go toward 14 Lower Manhattan projects.

The settlement, reached in March 2015, included a payment of $40 million to the Lower Manhattan Development Corporation and a $10 million forgiveness of payments owed by the corporation. Of the settlement, $10 million will be dedicated to completing an expansion of Hudson River Park from Chambers Street to West Houston Street, Gov. Andrew Cuomo announced in a statement. Also, $7 million will go toward redeveloping Pier 42, $6 million to a playground at Battery Park and $4.8 million for a new community center at the South Street Seaport Museum.

The LMDC’s lawsuit stemmed from the construction company’s role in demolishing the Deutsche Bank Building. The project faced years of delays and cost overruns and in 2007, a fire broke out at the site, killing two firefighters. The incident caused a flurry of litigation and a criminal investigation. The widow of one of the firefighters sued Lend Lease and the city for alleged safety lapses at the site and ultimately received a $10 million settlement, the Daily News reported at the time. Lend Lease — then Bovis — ultimately wasn’t indicted and changed its name after the fire.

When asked to comment on the settlement disbursements, a Lend Lease representative said the company does not comment on litigation.

Following the settlement agreement last year, LMDC formed a group of state and city officials to determine how the funds would be divvied up. In September, U.S. Sen. Charles Schumer and state Sen. Daniel Squadron called on LMDC to dedicate settlement funds to redeveloping Pier 42.

In 2011, Cuomo announced that he would wind down LMDC, a city-state agency created post Sept. 11. For now, it’s still kicking.

“The Lower Manhattan Development Corporation has been a major force in the rebuilding for this community, and with these projects, this progress will continue for years to come,” Cuomo said in a statement.

Source: LMDC to use M settlement to bankroll 14 public projects

From the March issue: As Airbnb has grown, so has the number of companies piggybacking on it and its rivals in the short-term rental market space. Firms like Keycafe, Pillow, AirDNA, Guesty and Happy Host are creating niches for themselves by offering marketing, cleaning, management and data analysis. These startups typically serve the most dedicated short-term hosts, but they have also marketed themselves to property investors, hotel research firms, global financial institutions, restaurants and, in at least one case, dog walkers. [more]

Source: Here are the companies piggybacking on Airbnb

Starwood Hotels & Resorts accepted Anbang Insurance Group’s $13.2 billion takeover offer with the Chinese insurance giant acquiring the hotel owner and operator.

Anbang will pay $78 per share in cash for Starwood, with news of the bid made public just this week. However, Marriott, under the terms of a prior agreement to buy Starwood in November for $12.2 billion, now has five days to respond.

Anbang will also have to pay a hefty fee to Marriott if the bid goes through, CNBC reported.

Marriott plans to make a counter-bid, sources told CNBC.

News of the deal lifted Starwood’s stock to 4.6 percent to $79.90 in pre-market trading, according to CNBC.

Last weekend, Anbang, which owns the Waldorf Astoria, also moved to acquire another marquee U.S. hotel portfolio. The Beijing-based insurer has a deal to buy the 16-property Strategic Hotels & Resorts portfolio from the Blackstone Group for a record $6.5 billion.

The Real Deal looked at what was behind the more than $19 billion play — global ambitions coupled with a slowdown in China. The combined figure roughly represents the total volume of Chinese investment in U.S. commercial real estate from 2007 to 2015. [CNBC] — Dusica Sue Malesevic

Source: Starwood accepts Anbang’s .2B takeover offer

In the latest squabble between the two leaders, Gov. Andrew Cuomo said the homelessness crisis is getting worse and placed the blame squarely on Mayor Bill de Blasio’s management of the homeless shelter system.

“The system is clearly not well-run and is clearly dangerous,” Cuomo said at an unrelated press conference Thursday. “And the state has an affirmative role, to remedy that situation and that’s what we’re in the process of doing.”

Cuomo said homelessness is a “growing problem” and a crisis that is “getting worse,” Politico reported.

The number of people using the shelter system has remained around 58,000 for the roughly past year, according to Politico.

Two recent incidents — a man was fatally stabbed at an East Harlem shelter in January, and a woman and her two children were murdered at a Staten Island facility that was used as a shelter last month — were cited as indications of the system’s safety issues.

“The homeless don’t want to go into the shelter system. I’ve heard that from providers, shelter operators, I’ve heard it from homeless people who say, ‘I’m afraid to go into the shelters and I’d rather stay on the streets than go into the shelters.’ It’s true. It’s not that the homeless people are wrong. They happen to be right. It is dangerous to go into the shelters,” said Cuomo, as reported by Politico.

The state has stepped up its number of inspections for the city’s shelter system, according to Politico.

De Blasio recently appointed the former Commissioner of Homeless Services, Gilbert Taylor, as a Family Court judge. Taylor quit his post around three months ago as the city struggled to limit the surge in homelessness. [Politico] — Dusica Sue Malesevic

Source: Cuomo criticizes de Blasio again on homelessness issue

The Imperial Court Hotel, a single-room occupancy hotel on the Upper West Side, lost an appeal in court Thursday, with broad implications for the city’s SROs.

A panel of judges ruled the 227-room Upper West Side hotel, located at 307 West 79th Street, was not exempt from New York state’s 2010 Multiple Dwelling Law, and could not continue offering one-week rentals.

But whether the ruling is a good or a bad thing seems to be in the eye of the beholder, the New York Post reported.

“This really does affect a lot of families and others,” the hotel’s attorney Charles Chehebar told the Post, “Including tourists and people living paycheck to paycheck, or people who are down on their luck and need a place to stay for a week or two.”

Tenant advocates, however, argued that SROs are so keen to rent short-term simply because it’s more profitable.

“It’s really about depriving New Yorkers of permanent resident housing,” Marty Weithman of MFY Legal Services, which filed an amicus brief in the case, told the Post. “Many SROs are taking advantage of residents by failing to tell them about their rights. You can become a rent-stabilized tenant by living in an SRO continuously for six months or by requesting a lease at any point after first registering,”

The Imperial Court is likely to appeal the ruling, Chehebar told the paper.

Back in 2014, the building’s owner, Ron Edelstein, accused Mayor Bill de Blasio of ordering the Department of Homeless Services to nix the owner’s plan to convert the SRO into a homeless shelter. [NYP] – Ariel Stulberg

Source: SRO barred from renting rooms for less than 30 days

Prices for high-end Hamptons homes fell in 2015, as demand from stock traders and financiers sunk with the global economy.

The 10 most expensive Hamptons home sales in 2015 had an average price of $35.5 million, a 20 percent drop from 2014’s $44.6 million mark, according to data from East Hampton brokerage Town & Country Real Estate cited by Reuters.

Prices for the high end of the Hamptons residential market are deeply dependent on Wall Street’s performance, brokers said, both in terms of overall stock prices and the bonuses traders and executives take home.

The S&P 500 index lost 0.7 percent of its value last year, excluding dividends, and is down about 1 percent so far in 2016. The average bonus given by Wall Street banks likely fell 5 to 10 percent in 2015 compared to 2014, Johnson Associates’ Alan Johnson told the news service.

Related Cos. CEO Jeff Blau and Goldman Sachs boss Lloyd Blankfein are apparently attuned to these kinds of things. Blau cut the asking price on his six-bedroom Bridgehampton mansion, located at 313 Dune Road, to $27 million, from $33 million. Blankfein took $4 million off the ask for his seven-bedroom abode at 121 Parsonage Lane in Sagaponack. He’s now seeking $13 million.

Still, 2015’s average top 10 sales price number wasn’t so bad. In fact, it was the second highest level ever recorded.

“It’s not something that’s going to kill the market,” Halstead Property’s Anthony DeVivio told Reuters.

The Hamptons market on the whole also held up nicely, with median prices climbing 3 percent to $1.12 million from 2014, according to the Corcoran Group. [Reuters] – Ariel Stulberg

Source: As Wall Street has dipped, so have prices of high-end Hamptons homes

Compromises were meted out to get Mayor Bill de Blasio’s affordable housing proposals approved, but labor groups come out nearly empty-handed.

Thus far, construction unions have the city’s commitment for a study.

But the exact details of the study remain murky. When de Blasio and Melissa Mark-Viverito, the City Council speaker, were pressed for specifics at press conferences, their responses were vague.

“So, the exact scope of the study has not been fully determined, but it is something we intend to get to work on quickly,” de Blasio said at a press conference, Politico reported.

Labor funded and aligned itself with the coalition, led by Real Affordability of All, against the mayor’s plan. After the promise of a study that will look at more affordability, the coalition switched sides and now supports the mayor’s proposals.

The administration also compromised with the City Council, including support for a bill that would require some landlords and property owners to prove no tenants were harassed before the city granted permission to demolish or alter a residential building.

Labor leaders wanted to tie some of their measures to the affordable housing legislation, but were rebuffed, according to Politico.

“I would have liked to have seen a better plan for labor, with standards that are attached to any financing by the city,” Council member Elizabeth Crowley told Politico. “I’m going to try and remain optimistic, although the administration has not shown for the past two years that it is interested in getting at the heart about whether or not these are living-wage jobs. This is a little bit kicking the can down the road, but I am hoping that something can come out of it.” [Politico] — Dusica Sue Malesevic 

Source: Labor loses out in de Blasio affordable housing plan

Keith Richards clearly couldn’t get no satisfaction from the Fifth Avenue apartment he bought in 2014.

The Rolling Stones rocker and his wife Patti Hansen have relisted the four-bedroom, four-bathroom spread at 1 Fifth Avenue for $12.23 million almost exactly two years after buying it for $10.5 million, StreetEasy shows.

The Greenwich Village property is listed by Stan Ponte of Sotheby’s International Realty. Ponte didn’t immediately respond to a request for comment.

Richards, a notorious bad boy, certainly didn’t paint the pad black. The contemporary style apartment, which was renovated in 2011, is decorated in muted, neutral colors.

It has three setback terraces flanking the living, dining and entertainment spaces, a library and an open staircase with leather wrapped bronze handrails. It includes a Lutron lighting system, central air conditioning and a Sonos sound system.

The building, which dates back to 1929, was originally a hotel and is known for its Art-Deco detailing.

Source: Keith Richards lists Fifth Avenue pad for .2M

A federal judge issued an order demanding the city release information related to cases where people residing at public housing and homeless shelters had elevated levels of lead detected in their blood.

The city’s Department of Health and Mental Hygiene rejected an earlier request for the information from a civil investigation in order not to violate city and state health codes, according to court documents.

Federal prosecutors are investigating environmental health and safety conditions at New York City Housing Authority complexes and homeless shelters, the New York Times reported. The investigation is also looking into “possible false claims” submitted by the city to the Department of Housing and Urban Development.

Prosecutors are seeking documents from NYCHA and the Department of Homeless Services about cases where rising levels of lead have been detected in the blood of residents, the Times reported. The feds are also seeking the dates of those cases as well as environmental investigation dates.

NYCHA, which is already under court supervision for its handling of mold repairs, cited shrinking federal funds and aging infrastructure at its myriad complexes as part of the problem.

The agency is moving forward with its controversial infill plan, which will build apartments on underutilized public land on NYCHA complexes, to bring in anywhere from $300 million to $600 million in revenue. [NYT] — Dusica Sue Malesevic

Source: Feds probe elevated blood-lead levels at NYCHA housing, homeless shelters

From the March issue: David Bistricer is CEO of Clipper Equity, a real estate firm started by his father in the 1950s. Today, the Orthodox Jewish family owns 60 buildings, with thousands of residential units, in New York and New Jersey. In 2005, the family firm bought Flatbush Gardens, a sprawling rent-controlled complex in Brooklyn. The company has also partnered with the Chetrit Group to buy five properties, including the Sony Building at 550 Madison, which the developers paid $1.1 billion for and are converting into condos topped by a $150 million penthouse. The firm is currently in the process of selling part of its portfolio in an initial public offering, with the goal of raising $144 million by launching a real-estate investment trust named Clipper Equity on the New York Stock Exchange. [more]

 

Source: The Closing: David Bistricer

Billionaire brothers David and Simon Reuben are reportedly foreclosing on the Plaza Hotel, with plans to hold an auction for the legendary property next month.

The Monaco-based Reubens paid $800 million for debt on three properties, which included the five-star hotel in Midtown, from Bank of China last year after the hotel’s current majority owner, Subrata Roy’s Sahara India Pariwar, defaulted. Sahara also owns the Dream Downtown in Chelsea and the Grosvenor House in London.

The Plaza’s hotel rooms, its restaurants and retail space are for sale, sources told Bloomberg. The Dream Downtown hotel is also part of the package.

Both the Plaza and the Dream are collateral for the Bank of China loan and the combined mortgages is around $500 million, sources told Bloomberg.

Subrata Roy, the founder of Sahara, is being held on $1.6 billion bail after the Indian government alleged unpaid debts of around $6 billion to company bondholders. Sahara attempted to sell the hotels in the past to raise money to release Roy.

Ownership of the iconic hotel has changed hands many times, with current GOP frontrunner Donald Trump buying the Plaza in 1988. Trump sold it seven years later to Troy Richard Campbell for $325 million. Campbell sold it for $675 million to the Elad Group, who converted the property into high-end condominiums.

Chinese insurer Anbang Group, who bought the Waldorf Astoria last year, recently made offers totalling $19B for two large U.S. hotel portfolios, acquiring $6.5 billion for Starwood Hotels & Resorts, and bidding $12.9 billion for the 16-property Strategic Hotels & Resorts portfolio, owned by the Blackstone Group. [Bloomberg] — Dusica Sue Malesevic

Source: Plaza Hotel to hit the auction block

Davide Bizzi’s Bizzi & Partners, Michael Shvo and Howard Lorber’s New Valley raised $175 million through the EB-5 program from the Chinese for their 91-story tower at 125 Greenwich Street.

The Real Deal reported in February that the developers were about halfway to reaching their fundraising goal through the EB-5 program, which grants foreign investors a U.S. green card in exchange for a $500,000 investment.

Separate from the round of EB-5 financing, the developers are also in advanced talks for a little more than $500 million in construction financing, TRD reported last month. Sources told TRD the lender is Singapore’s United Overseas Bank. The bank originated a $135 million land loan for 125 Greenwich in August 2014, according to property records.

Another equity raise, overseen by JLL, is expected soon, the New York Post reported.

The Rafael Vinoly-designed building is slated to have 275 condominiums over 306,312 square feet, according to an offering plan filed with the Attorney General’s office.

A sales office on the 84th floor of One World Trade Center is expected to open after Labor Day, the Post reported. Prices for the condos have yet to be released, but units will range in size from a 403-square-foot studio to a three-bedroom pad measuring 3,625 square feet. The developers paid $185 million for the site. [NYP, 2nd] — Dusica Sue Malesevic

Source: Bizzi, Shvo hit their 5M EB-5 mark for 125 Greenwich Street

GuildNet, the health management services division of Lighthouse Guild, will soon take up residence at Empire State Realty Trust’s 250 West 57th Street.

The nonprofit signed a 10-year lease to take the 10th floor and part of the ninth at the 26-story, 430,000-square-foot Midtown office building between Broadway and Eighth Avenue. Asking rent at the space was about $67 per square foot, the New York Observer reported.

CBRE’s Brian Gell and Laurence Briody represented GuildNet in the deal. Keith Cody represented Empire State in-house, with the help of Cushman & Wakefield’s Harry Blair and Sean Kearns.

The real estate investment trust bought the property in 2013 for $170 million.

GuildNet is leaving its current home at the Lighthouse Guild’s headquarters at 15 West 65th Street.

Architecture and interior design firm CookFox Architects also recently took a space at the building, signing a 16-year lease for 18,000 square feet back in October. [NYO] – Ariel Stulberg

Source: Health services firm takes 37K sf on Billionaires’ Row

Instead of being a boon for Essex Street Market vendors, the massive $1 billion redevelopment of the Seward Park Urban Renewal Area across the street has been a headache — and businesses are closing up shops.

Four out of 25 vendors at the existing indoor market have shuttered since the city announced Delancey Street Associates would develop the nine-block project three years ago. Delancey Street Associates is a joint venture between BFC Partners, L+M Development Partners and Taconic Investment Partners.

“Foot traffic has taken a nosedive, because everybody in the city thinks it’s already closed or is closing any day now,” Rhonda Kave, owner of Roni-Sue Chocolates, told Crain’s.

In February, Kave closed her store on Forsyth Street after eight years, Crain’s reported.

Now the city’s Economic Development Corporation turned control of the markets’ promotion over to the Lower East Side Partnership, Crain’s reported.

The new Essex Street Market, which is slated to open in 2018, will have space for 45 stalls, according to Crain’s. Current tenants will continue to pay the same rent per square rent they are now while new tenants will pay market rate, Crain’s reported. Delancey Street Associates will cover moving expenses, Crain’s reported.

“Everything we do going forward that’s about the new market will tie in something about the current Essex Street Market,” Rohan Mehra, a principal in the Prusik Group, which handles commercial leasing at Essex Crossing, told Crain’s.

In December, Delancey Street Associates received a $79.5 million financing package from Wells Fargo. Located at 175 Delancey Street, the 1.9 million-square-foot Essex Crossing project will house 100 affordable units for seniors, 20,000 square feet of community space, 26,000 square feet of space for nonprofit use and 50,000 square feet of medical facility space. The project is slated to have 1,000 residential units, half of which will marketed as affordable.

Goldman Sachs’ Urban Investment Group has invested nearly $200 million and is likely to up that to $500 million by the time the project is completed. [Crain’s] — Dusica Sue Malesevic

Source: Market vendors folding due to Essex Crossing project

Toronto-based parka maker Canada Goose will take Patagonia’s old space at Jeff Sutton’s 101 Wooster Street in Soho.

The retailer signed a lease for a 4,400-square-foot space at the early 1900s-era property, where asking rent was about $550 per square foot, the New York Post reported.

RKF’s Robert Cohen negotiated on behalf of Canada Goose.

The space has been occupied since 1995 by another outdoor clothing company, Ventura, Calif.-based Patagonia, which is moving to 72 Greene Street.

Sutton’s Wharton Properties bought the seven-story, 24,000-square-foot property – located between Spring and Prince streets – in 2015. In addition to the retail space, the building also has nine condominium units.

Canada Goose, founded in the 1950s, makes heavy-duty, goose down winter coats with fur-trimmed hoods. In 2013, the private equity firm Bain Capital took a majority stake in the company. [NYP] – Ariel Stulberg

Source: Canada Goose migrates to Jeff Sutton’s 101 Wooster Street

Construction costs in the five boroughs grew steadily for the third year in a row at roughly 5 percent.

That’s still less than half the rate that costs climbed last cycle, according to a new study by the New York Building Congress, which found that nonunion labor is likely one of the main culprits behind the relatively slow rate of growth.

Using an average of five different indices that track hard costs such as construction materials and labor, the Building Congress found that the overall cost of materials such as fuel oil, steel, lumber and gypsum products remained nearly flat last year as global demand declined.

The high demand for construction work in the city, however, was most likely the main driver of rising costs as the tight construction market put upward pressure on wages and bid prices, the Building Congress found.

President Richard Anderson, who is stepping down at the end of the year after nearly 25 years as head of the trade group, said that the rate of inflation is “a cause for concern, especially when you also consider the rising cost of land in the five boroughs.”

“But it is also worth noting that while the construction market is as strong as it was during the previous building boom, we have not seen a return of cost increases in the double-digits, like we saw from 2006 through 2008,” he added. “This may be due in part to the growth of non-union construction work.”

Nonunion workers make up as much as 50 percent of the construction market today and are taking on high-profile jobs like JDS Development and Property Markets Group’s 111 West 57th Street that have traditionally been dominated by the union workforce, as The Real Deal has reported.

In the early years of the recovery between 2010 and 2012, construction costs in the city increased at a rate no greater than 3.25 percent. But in 2013 they jumped five percent and continued that rate of growth until spending hit a whopping $40.9 billion last year.

At the height of the last building boom, construction costs increased 12 percent in 2006 and 11 percent in 2007 – more than twice the rate at which they’re growing now.

According to a Building Congress survey of construction executives that looks at costs on union jobs, labor costs are the highest on hospital projects, ranging from $800 to $1,000 per square foot.

That was followed by university buildings ($600-$900 per square foot), five-star hotels ($700-$800 per square foot), secondary schools ($500-$800 per square foot) and speculative office space ($425-$500 per square foot).

Source: Nonunion labor keeping wage growth down: report

So many ultra-luxury apartments, so few ultra high-net-worth individuals who want to buy them.

The top of the end of the city’s residential market – embodied in the Billionaires’ Row condo towers – is showing more and more signs of overheating.

At least 300 apartments priced at or above $5,000 per square foot are either selling now or will hit the market in the next 24 months. Last year, just 47 apartments sold at that price level, down from the peak year of 2014, when 55 ultra-luxury units sold, the New York Times reported.

Trouble in China, Russia and other emerging economies suggests foreign buyers – who have account for as many as three-quarters of all top-end sales – may not be as inclined to spend as they once were, brokers told the Times.

“I wouldn’t take a bet on doing a high-end condo building and trying to sell apartments at $5,000 per square foot,” TF Cornerstone’s Thomas Elghanayan told the Times.

The problem may not be a lack of potential buyers, as a back-of-the-envelope analysis by The Real Deal suggested last year. Rather, real estate consultant Nancy Packes told the Times, rich buyers may have simply already left the market, deciding the time to buy had passed.

“We did not run out of wealthy people,” Packes told the Times.

Sponsors have recently begun reducing prices and dividing large units at some of the priciest buildings. Joseph Beninati’s Bauhouse Group recently defaulted on the loan for its planned 3 Sutton Place condo tower on the Upper East Side. The property will now be sold at auction.

Steve Witkoff also recently set aside plans to convert the Park Lane Hotel at 36 Central Park South to luxury condos, citing a lack of “velocity” in the market.

“My personal view is that, in this cycle, we have passed the toy,” said Naftali Group head Miki Naftali at a summit hosted by the magazine Haute Living in November.

“For those who think that it will continue to go up – that if they have something that is selling for $3,000 a foot today, it will sell for $4,000 a foot tomorrow or a year or two years from now – I don’t see that happening. There is definitely a slowdown in the velocity of deals.” [NYT] – Ariel Stulberg

Source: Supply glut stalling out luxury resi market

Tech companies have specific requirements when looking to lease, namely, the option for more space, and the city’s landlords are willing to oblige this need to lure them to their buildings.

Take, for instance, the Muse, an online career resource that was shopping for office space. The firm ended up at Westbrook Partners’ 1375 Broadway, taking 18,000 square feet.

Muse committed to the entire 20th floor space at the 24-story, over 460,000-square-foot building because it has the option to take another full floor to double its space, Crain’s reported.

Westbrook bought the building from Savanna for $310 million last summer. Asking rent is $65 per square foot, Crain’s reported.

“They’re growing rapidly, so the ability to continue to expand if they need more space was a significant factor in their decision where to move,” Dennis Someck of Lee & Associates told Crain’s. Someck and colleague Justin Myers represented Muse for the 10-year lease. CBRE’s Paul Amrich and Neil King represented Westbrook.

The Muse is looking to nearly triple its space in Manhattan and currently has 6,500 square feet at 151 West 25th Street.

Someck also brokered other deals for tech firms that included the option to double space. Digital market research firm L2 recently exercised its expansion option, upping its 12,500 square feet at the 12-story, over 310,000-square-foot 740 Broadway to around 25,000 square feet, Crain’s reported. [Crain’s] — Dusica Sue Malesevic

Source: Landlords entice tech tenants with expansion options

From the March issue: Stephen Siegel, the chairman of CBRE’s global brokerage division, is a notoriously lousy golfer. On a good day, he can shoot below 100 — maybe.

Nevertheless, last October, Siegel gamely showed up at Reynolds Plantation, a lakeside resort in Greensboro, Georgia, for Brookfield Property Partners’ annual golf outing. All told, 60 commercial real estate brokers made the trip. [more]

Source: The double life of CBRE’s Stephen Siegel

Tishman Speyer has no plans to start building on its newly-assembled far West Side side.

The developer won’t begin on its planned 1.3 million square foot office tower at the site – across from the Jacob Javits Center on 11th Avenue between 37th and 38th streets – until it has pre-signed tenants in place, the New York Post reported, citing sources familiar with the company’s plans.

Tishman announced two buys at the site last week. It bought 434-444 Eleventh Avenue from the Imperatore family, for roughly $185 million. It also picked up a 7,400-square-foot plot at 550 West 37th Street from the Chiaia family for an undisclosed price.

“Manhattan’s far west side is well on its way to becoming the world’s most modern, dynamic and sustainable urban neighborhood,” the company’s CEO, Rob Speyer, said at the time.

The company is planning another tower nearby, at Hudson Yards. That Bjarke Ingels-designed, 2.85-million-square-foot office tower is to be known as “The Spiral.”

The firm received a 25-year tax abatement worth $170 million for that project, and is also seeking financing by pre-leasing about 30 percent of the tower.

Major office tenants including Time Warner, KKR, Boston Consulting Group and Skadden Arps have recently quit Midtown for the Related Cos’ Hudson Yards towers and Brookfield’s Manhattan West. [NYP] – Ariel Stulberg

Source: Tishman won’t build near Javits Center without anchor tenants

City officials finally cut a deal on the future of New York’s housing policy.

The City Council is set to enact Mayor Bill de Blasio’s major housing initiatives after striking a deal to alter several of the planned rule ranges, strengthening affordability requirements. Business groups, not surprisingly, are less than thrilled.

The agreement struck between the executive and legislative will deepen affordable housing concessions required of landlords who benefit from city rezonings under the new Mandatory Inclusionary Housing program. The accord maintains height limits in some Manhattan neighborhoods and made changes to parking requirements at senior and housing developments in the outer boroughs, Politico reported.

De Blasio’s proposal created three affordable housing options for residential developers who benefit from rezonings. The City Council will add a fourth, which will require that 20 percent of units go to tenants making 40 percent of the area median income (AMI). The Council will also the lower the level of the top affordability tier, to 115 percent of area median income from 120 percent.

The deal will also make changes to de Blasio’s Zoning for Quality and Affordability plan. It will also exempt parts of Manhattan from a five-foot increase in height allowance. Additionally, it will keep in place requirements that some outer borough senior housing developments within a half-mile of public maintain a parking lot.

Business groups spoke out against the agreement, saying the housing plan could result in fewer affordable units being built.

“It is great that the Council wants to get to ‘yes,’ but their design and affordability proposals add up to a more expensive, less flexible program that will likely produce fewer affordable units over all,” said President of the Partnership for New York City Kathryn S. Wylde, according to the New York Times. “The Council’s call for 20 percent of units to be rented at 40 percent of A.M.I. will typically require additional subsidy from another source, which limits the volume of production that can be achieved through the zoning package alone.” [Politico, NYT] – Ariel Stulberg

Source: City Council to approve de Blasio housing plans, with changes

The Manhattan residential luxury market saw its best week of 2016, with 26 contracts signed for pads asking $4 million or more, according to Olshan Realty’s weekly luxury market report.

For the week of Mar. 7-13, the total weekly asking price sales volume was $187.2 million with an average asking price of $7.2 million. The average number of days on the market checked in at 226 and the average discount was four percent. While this week’s 26 contracts inked has been the highest total this year, last year around this time 37 contracts were signed.

The No. 1 contract was a brownstone at 14 West 69th Street, asking $15.5 million. This 25-foot-wide building has 10,020 square feet that is divided into 15 apartments, and is being sold free and clear of tenants.

The No. 2 contract was Penthouse 1 at the Toll Brothers City Living’s 959 First Avenue, known as the Sutton. The four-bedroom, 4.5-bathroom triplex has 3,503 square feet and terraces totaling 1,770 square feet with an asking price of $11.8 million. Both the master suite on the second floor and a family room on the top floor features a 31-foot terrace. The terrace on the upper level also has a swimming pool. The 113-unit, 29-story condominium building also has a fitness center, garden, children’s playroom and storage rooms. [Olshan Realty] — Dusica Sue Malesevic

Source: Manhattan luxury real estate market saw its best week yet this year: Olshan

The daughter of one of India’s best-known businessmen, Vijay Mallya, received a forbearance agreement on her trophy Trump Plaza penthouse last year as her liquor baron father’s financial problems mounted, according to documents reviewed by The Real Deal.

Tanya Mallya, a student at Columbia University who lives in a penthouse comprised of seven co-op units at 167 East 61st Street, was handed a forbearance agreement by the Trump Plaza co-op board in February 2015 because she was unable at the time to pay her share of the $185 million land lease.

She owed $10.1 million as part of a resident assessment to buy the underlying land at Trump Plaza, according to a forbearance agreement between the Plaza owners and Tanya Mallya, whose name is on the deed. The family has since reached an agreement with the co-op board, according to a person familiar with the matter.

Michael Greenberg, a lawyer representing Vijay and his daughter, declined to comment.

Vijay purchased the units over time, including some in 2010, for his daughter but his fortunes as India’s so-called “King of Good Times,” have since taken a nosedive. He recently agreed to step down from his position as chair of United Spirits (though he received a $40 million sendoff) and was accused of funneling funds to other parts of his business empire in an effort to save the now-defunct Kingfisher Airlines. Several news outlets reported last week that Vijay, described by some as India’s version of Richard Branson, absconded and owes various creditors over $1 billion. He’s taken to social media to deny the charges.

Documents suggest Vijay’s financial struggles in recent years resulted in the family being initially unable to cough up the $10.1 million to cover its share of the land lease buy. Neither Vijay Mallya nor his daughter responded to requests for comment.

In 2014, the co-op board agreed to pay $185 million for the underlying land after the land’s owner put it up for sale. Some residents chose to sell their apartments instead of forking upwards of $1 million to pay their assessed share of the land lease purchase.

A loan was obtained by the co-op “in anticipation that certain tenants would be unable to pay their pro rate share of the assessment,” according to the forbearance agreement, and was issued to owners who could not make the payments up front.

The Mallyas were on that list, though it seems any issues have since been resolved.

“We don’t have an issue with Mr. Mallya,” said Marc S. Cooper, the president of the Trump Plaza co-op and CEO of Peter J. Solomon Company, declining to comment on the matter further.

Because of the land lease history, sellers have had a tough time finding buyers for the Trump Plaza. There are currently 11 apartments for sale in the building, according to Andrea Lucas, a Corcoran Group broker who is representing a seller who has reduced the asking price for their four-bedroom apartment from $6 million to $5.4 million.

“The building has a bad reputation,” Lucas said. “A lot of brokers still stay away from it thinking there’s still a land lease.”

Source: Vijay Mallya, daughter avoided foreclosure on Trump Plaza PH

From the March issue: In the 1970s, union members had a monopoly on New York City’s skyline. At the time, card-carrying union workers made up a stunning 90 percent of the city’s construction workforce. Not surprisingly, that number is down significantly today. The latest stats peg the nonunion market share at 40 percent — and some say it may be as high as 50 percent. [more]

Source: Are construction unions losing leverage in NYC?

“I don’t settle lawsuits – very rare – because once you settle lawsuits, everybody sues you – very simple,” said Republican front runner Donald Trump during a press conference last week.

Trump’s aversion to making legal deals may go back decades – “You don’t use the term ‘settlement’ with Donald,” his attorney Roy Cohn told the New York Times more than 30 years ago – but he has in fact cut a few over his career.

The Real Deal looked at five major New York real estate cases where Trump got out while the gettin’ was good.

100 Central Park South (now Trump Parc East)

Trump bought this park-facing address with its neighbor, the Barbizon Hotel, in 1981, and quickly announced his plans to demolish them both. At the 15-story 100 Central Park South, Trump struggled to find any legal means of dismissing dozens of rent-regulated tenants. He famously offered that the City of New York let him house homeless people in the building and brought a number of lease violation suits against tenants, some of which were thrown out (and which Trump himself admitted were brought “stupidly” in his 1988 autobiography, The Art of the Deal). Meanwhile, the residents of the building sued Trump for harassment. In 1986, Trump and the tenants association struck an agreement. In exchange for dropping their harassment litigation, Trump dropped eviction proceedings against rent-controlled and rent-stabilized tenants and scrapped his plans to demolish the building. DHCR, the state affordable housing regulator, would monitor any forthcoming the luxury renovations.

Trump Spin: Thomas Macari, a Trump spokesperson at the time, said, “They [tenants] haven’t really won. They’ve lost because they wanted to buy their apartments.” In The Art of the Deal, Trump wrote that he had already decided not to demolish the building anyway, and said that because the Manhattan real estate market skyrocketed during the litigation, it actually benefitted him in the long run, as building condos on only the Barbizon site would now return more income than if he had knocked down and redeveloped both building sites at the time of purchase. “In effect, I was sitting on gold,” he wrote.

The Trump rental portfolio

In the early 1970s, the federal government brought an enormous housing discrimination action against Trump Management, the real estate company started by Donald Trump’s father, Fred Trump. The government alleged that the Trumps had discriminated against prospective tenants at dozens of rental properties across New York City, refusing to rent apartments to individuals on the basis of race. The Trumps settled in 1975, promising the government they would not discriminate and would personally read up on the Fair Housing Act. They also agreed to provide the Urban League with a list of available apartments every week for two years, as well as allow the Urban League to present the them with eligible tenants for vacancies at certain buildings.

Trump Spin: Donald Trump said the agreement was to his “full satisfaction” because it didn’t include a mandate to take tenants on welfare unless they were fully qualified. In The Art of the Deal, Trump wrote “we ended up making a minor settlement without admitting any guilt.”

Trump Tower

In 1983, a housewreckers union member named Harry Diduck filed suit against Trump for cutting Laborers Local 95 out of $300,000 in benefit fund fees during the demolition of the Bonwit Teller Building, the art deco building Trump axed for the construction of Trump Tower. Much of the sum would pay out medical and pension benefits to Polish workers that had been contracted to work the Trump Tower site. The lawsuit went on for 15 years. In 1991, a federal judge ruled Trump and his partner Equitable had illegally withheld funds, conspiring with the head of the union. The estimated worth of the unpaid money with interest was upwards of $4 million. Trump appealed, but decided to settle in 1999 before it got any further. The year before, Trump said “It [settling] would be cheaper, but on principle I won’t… We did nothing wrong.”

Trump Spin: The settlement was sealed and Trump did not comment on it at the time. Marco Rubio claimed in a recent debate that Trump had paid out $1 million in a judgment, to which Trump interjected “wrong, wrong.” It is not known what the actual settlement payment was.

GM Building

Now the stuff of an upcoming Hollywood film, Donald Trump famously settled with his former partner Conseco Inc. in the sale of the GM Building in the early 2000s. With Conseco in bankruptcy, Trump wanted to buy the GM building all for himself. But the parties feuded over whether Trump, a stakeholder in the tower, actually had the means to do so. Trump later sued Conseco for $1 billion, claiming they blocked his bid, issuing an “improper demand” to obtain a letter of credit from Deutsche Bank as a term of the closing. Trump also claimed that the attacks of September 11^th had made it impossible for him to find financing after Conseco delayed a September 6^th, 2001 closing, causing him further damage.

Ultimately, an arbitration panel ordered Trump to sell his stake in the building to Conseco for $15.6 million. The panel’s order was later affirmed by a state Supreme Court judge. And, according to court documents obtained by The Real Deal, the $15.6 million check Conseco would write to Trump would only be a $4.5 million check, once city and state transfer taxes were subtracted. Trump motioned for contempt, but this was withdrawn when Trump entered into a confidential settlement with Conseco in summer of 2003.

Trump Spin: Though the precise terms of the agreement are secret, two sources briefed on the terms told the New York Times in 2003 that Trump ended up selling his stake to Conseco for $15.6 million after all, with Trump receiving a modest amount of the proceeds from Conseco’s full sale of the GM Building for $1.4 billion to Harry Macklowe. But the same day, the New York Post reported that, according to sources, Trump would be getting at least a $100 million pay out. “Both parties made a wonderful deal,” Trump said, declining to discuss the terms of the settlement.

Trump Soho

The developers of the Trump-branded condo-hotel at 246 Spring Street refunded 90 percent of security deposit dollars to 15 buyers, including French soccer star Olivier Dacourt, when those buyers sued over “deceptive” marketing tactics. Donald Trump, who was not a co-developer but whose company manages the building and was involved in marketing the units along side Bayrock Group and Sapir Organization, was named defendant in the suit. The plaintiffs claimed that Trump and the other defendants misled them by publicly reporting that 60 percent of Trump Soho’s units were already sold when in reality just over 15 percent had. To dissuade buyers from joining the suit, the developers offered to refund half the deposits to buyers who had not yet closed on their condos. The plaintiffs who did participate in the action, however, reached a settlement for bigger refund payouts in 2011.

Trump Spin: Trump did not comment on the lawsuit at the time, but did say that it was probably a good idea for the developers to change unsold units from condo-hotel to just regular hotel (especially once everyone knew what the real sales numbers were). “Business is so strong that we’re delighted to get the units back,” Trump’s daughter Ivanka said at the time, a positive take bearing an uncanny resemblance to something her father might have written in The Art of the Deal.

Source: Five “very rare” times Trump settled NYC real estate lawsuits

Marriott Hotels suddenly faces competition in its bid to take over Starwood Hotels & Resorts – previously considered a done deal. On Monday, Starwood announced it received an unsolicited acquisition offer from an unnamed investor group for $76 per share, as well as stock considerations.

In November, Marriott reached a deal to buy the Stamford, CT-based hotel REIT for $12.2 billion – or around $72.08 per share at the time. Starwood, which owns hotel brands like Westin, W Hotels, St. Regis and Sheraton, had reportedly been looking for a buyer since April and received several offers before settling on Marriott.

According to Starwood’s statement, the Marriott offer of 0.92 Marriott shares and $2 in cash for each Starwood share has a current value of $63.74 per share, or around $10.8 billion total. The new offer, on top of $76 per share in cash, also includes stock considerations valued at $5.50 per share.

On Starwood’s website, the REIT said it received a “waiver” from Marriott allowing it to consider the new bid and began discussions with the mystery consortium on Friday.

“Starwood’s Board of Directors has not changed its recommendation in support of Starwood’s merger with Marriott,” the statement reads. “The Board, in consultation with its legal and financial advisors, will carefully consider the outcome of its discussions with the Consortium in order to determine the course of action that is in the best interest of Starwood and its stockholders.”

News broke over the weekend that Chinese insurer Anbang had purchased the Strategic Hotels & Resorts portfolio of 16 hotels from the Blackstone Group. – Konrad Putzier

Source: Investor group launches surprise bid for Starwood Hotels

In a lush field in Linton, New Zealand, Jono Williams’ all-white Skysphere tower stands alone. It’s probably the most hi-tech building for hundreds of miles.

Designed and built by Williams himself, Skysphere reached completion earlier this February. It sets a new standard of futuristic living, complete with app-controlled lighting fixtures, a voice-controlled beer dispenser in the couch, and the ability to go into “zombie mode,” in which the front door automatically locks with a “Good luck” message from Williams’ phone.

You can watch the video here:

But let’s take a closer look at the details, starting with the fact Williams pulled the idea practically from thin air.

“To be honest, I don’t even know where the idea came from,” Williams recently told Living Big In A Tiny House. “I was just kinda sitting there, and I had this idea, this vision, and then I just did it. I modeled it on a computer and then built it.”

Skysphere follows up on a smaller treehouse Williams built completely from recycled materials.

The new building, in a similar eco-friendly mindset, relies entirely on solar power as its source of energy.

According to Williams, he built the house to be both portable and strong. It can reportedly withstand an 8.5-magnitude earthquake and 125 mph winds, and still is detachable enough for Williams to uproot it without much effort.

The entire project cost roughly $50,000, Williams states on the Skysphere website, with more than 3,000 hours of his time invested in the DIY home.

Skysphere isn’t totally habitable over the long-term. The building still lacks internal plumbing, so Williams can’t build a bathroom or shower just yet. But, like all great treehouses, he’s still installed furniture in the 360-degree space, TV included — he just doesn’t have to run a cable from his parents’ house to use it.
Williams says if he does decide to make Skysphere a fully livable space, he’d construct a “bathroom module” at the bottom of the tower and perhaps a shower in the nearby woods.

Otherwise, he’ll continue flicking on the strobe lights when people are over and projecting cricket matches onto his windows when he’d like to watch a game in solitude.

Which, in the middle of a New Zealand field, perched high in his swanky tree house, doesn’t seem all that hard to accomplish.

Source: This futuristic treehouse has an automated beer dispenser and shuts down in ‘zombie mode’

From Luxury Listings NYC: They say three times is the charm, but in the case of Broadway producer Tracy Aron, it might just be the fifth time. According to city documents, Aron has finally sold her townhouse at 627 West End Avenue for $6.9 million to the liberal foundation, New World Foundation. [more]

Source: Broadway producer Tracy Aron sells UWS townhouse for M

From Luxury Listings NYC: Fans line the entranceway as Michael Strahan prepares to step out into the spotlight. The crowd screams wildly, brandishing bright yellow signs scrawled with his name. Some reach out in hopes of stealing a touch from the Super Bowl champion and NFL Hall of Famer. But Strahan keeps his eyes focused straight ahead on the camera. Then he struts out medium fast over the red carpet, extending both arms to high-five outstretched hands along the way. Pharrell Williams’ hit song “Happy” plays over the loudspeakers and Strahan pulls a goofball smile, exposing just a hint of his boyishly gapped teeth. [more]

Source: Michael Strahan’s happy now

Sales partially launched at Larry Silverstein’s Robert AM Stern-designed 30 Park Place tower nearly two years ago. But now the largest and most expensive of the announced penthouses at the project has finally hit the market asking $32.5 million.

The massive 6,127-square-foot aerie is located on the 78th floor and includes a double-height, north-facing loggia, overlooking Manhattan. It has two floors, five bedrooms, six bathrooms, a powder room, a library, an eat-in kitchen and oh, so much more, according to Curbed,

But true high rollers will want to combine the unit with another penthouse on the same floor, which is currently listed for $29.5 million.

But 78A won’t be the top dog at the project forever, as three full-floor penthouses on the 80th, 81st, and 82nd floors are still to come.

[Curbed] –Christopher Cameron

Source: 30 Park Place penthouse officially hits the market

Renovations at the famed Hotel Chelsea have been dragging on and expenses have run wild. Now, the former home of Bob Dylan, Arthur Miller, Sid Vicious and Jack Kerouac is once again changing hands.

Boutique hotelier Richard Born could soon take over the project, as the majority owners have parted ways with partner Ed Scheetz, according to the New York Post.

The redevelopment, located on 222 West 23rd Street, is running more than a year behind schedule and over budget.

Investor Bill Ackman, Leucadia National Corp. chairman Joseph Steinberg and real estate investment firm Wheelock Street Capital have now parted ways with Scheetz over expenses and disagreements.

“The place is a mess. They’ve spent a lot of money, but they are still right in the middle of construction. It might still need another $150 million. Then there’s a complex situation with the tenants, who are very litigious. It has become a hornets’ nest. Ackman and Steinberg hired bankers to explore selling it, but it didn’t sell, so they have been talking to other hoteliers,” a source told the Post.

Other hoteliers include Ian Schrager, who did not bite. But BD Hotels’ Richard Born — who owns stakes in the Bowery Hotel, the Mercer and the Greenwich Hotel — is now in negotiations. He would take over the management and buy a stake in the hotel.

“We are talking with the owners, but it is premature to say there’s a deal,” Born told the Post. [NYP] –Christopher Cameron

Source: Ed Scheetz leaves Hotel Chelsea project