NEW YORK CITY-A panel of real estate industry powerhouses issued cautionary words for Mayor-elect Bill de Blasio on Tuesday in Midtown during an Eisner/Amper forum entitled, “Real Estate Outlook: 2014 And Beyond?A Business And Political Perspective.” The speakers also discussed the city's migration westward while expressing somewhat bearish sentiments on both Midtown East rezoning and EB-5.
“As you move forward, you have to understand that New York State cut its deficit in three years and you're going to have to be that disciplined so that the city isn't devoting so much to debt,” advised former Governor David Paterson, when asked for counsel to the city's incoming mayor. “Most people would rather spend money and have the next generation pay for it, but you're going to have to think about a future beyond your service.”
Added Steve Witkoff, chairman and CEO, the Witkoff Group, “New York City is a shining example of a public/private partnership. Now we need fiscal responsibility that creates jobs. Dodd-Frank is anti-New York and anti-jobs.”
Chimed in Mitch Rudin, president and CEO, Brookfield Properties, “Most importantly, continue along the path of the quality of appointments you've made so far. Also, think about the importance of public/private partnerships. Without making the business community your friend, you're not going to have the success you want.”
And Glenn Rufrano, CEO of O'Connor Capitol—and previously the CEO of Cushman & Wakefield—noted, “The real estate community knows how to create wealth, but we may not be the best at knowing how to distribute it. If he [de Blasio] can help with that, and reward those of us who've created weath, [that would be good].”
But when they weren't talking politics, the esteemed panel discussed their renewed interest in the West Side and Lower Manhattan. They noted research showing a migration westward by as many as 75% of companies that moved over the last 10 years.
“Downtown is no longer the price alternative, its the demographic alternative because of what's happening in the boroughs,” said Rudin. “Also, New York has discovered that there's a big river on the west that extends up to the George Washington Bridge. When people say they want to live, work and play in a cool environment, what's cooler than being on the water?”
Said Witkoff, “We're doing quite a bit on the west side, we have sites at 101 Murray St. and 123 Greenwich St., and we're active in Times Square. And New York finally using its waterfront is a really big deal. We sold 150 Charles St. in 12 weeks, that's unheard of velocity. It's because of the location.”
Still, panelists felt the East side has its own appeal, and doesn't need the boost that could come with the rezoning plan. “I don't think its necessary in order for Midtown East to stay competitive with the West Side and Downtown,” said Rufrano. “I'd think Grand Central would have enough appeal; I'm not sure we need more space, we need better space. What's happening downtown is the creation of more functional efficiency, creating what tenants need.”
Asserted Rudin, “Sometime during the course of the de Blasio administration, it will get passed in some way, but it's importance is overstated. We already have the SL Green and L&L projects, and we could be a beneficiary because we own 245 Park Ave. though it's substantial occupied by long-term leases. So we're not going to change things one bit.”
When the discussion turned to EB-5, Governor Paterson sounded an alarm about the offering. “China's view of New York is positive but there are hundreds of proposals circulating around China and eventually it's going to become oversaturated. The opportunities are limited and there's a risk of oversubscription.”
But Witkoff disagreed. “We raised money for a project with Ian Schrager on Christie street in 12 weeks because the Chinese want their kids educated here. It's a great program.”
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Rayna Katz
Rayna Katz is a seasoned business journalist whose extensive experience includes coverage of the lodging sector, travel and the culinary space. She was most recently content director for a business-to-business publisher, overseeing four publications. While at Meeting News, a travel trade publication, she received a Best Reporting award for a story on meeting cancellations in New Orleans during Hurricane Katrina.
