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Late last year, the implementation of New York’s All-Electric Buildings Act was halted, and it remains in litigation. This delay should not be treated as a setback, but as an opportunity to refocus New York’s decarbonization strategy on what will actually deliver emissions reductions at scale.
Until now, our climate strategy has been too narrow. Electrification is essential to cut emissions, but we can’t rely on electrification alone to decarbonize an entire city of 8.5 million people. New York’s power supply and grid reliability are already under strain, and large-scale electrification of all heating systems in the near term risks outpacing the infrastructure needed to support it. We need a more resilient and diversified approach that embraces innovation in heating systems, sustainable fuels and the infrastructure that already exists under our feet.
New York’s public and private sectors already have the tools to do this. Con Edison has begun exploring lower-carbon steam generation, and the city’s own Department of Citywide Administrative Services is testing geothermal systems in municipal buildings. What’s missing isn’t technology, it’s the coordination.
Gov. Kathy Hochul’s $50 million investment to help SUNY Purchase develop a geothermal thermal-energy network, part of the state’s broader effort to expand shared heating and cooling systems across public campuses, is a promising example of this work. That project shows how targeted funding and district energy planning can deliver deep emissions cuts without forcing every building into a one-size-fits-all solution. Aligning state climate policy, local building law and utility regulation would unlock investment and prove that decarbonization and economic growth can move in tandem.
Much of the Manhattan skyline is powered in part by a vast underground district steam system — one of the largest of its kind in the world. More than a century old, it serves roughly 1,500 buildings and provides about 27 billion pounds of steam each year for heating, cooling and sterilization. Most of that steam is produced by facilities burning natural gas that are outdated and fossil-fuel intensive. That’s not a reason to scrap the system and start from scratch, but we need to evolve.
By converting some central plants that power the system to electric boilers and heat pumps where grid capacity and reliability allow, and by integrating waste heat, geothermal energy, thermal storage and lower-carbon fuels, New York could dramatically reduce emissions from its steam network. This allows the system to evolve as a hybrid, balancing electric and molecular energy sources as renewables scale and the grid strengthens. We don’t have to rip out the pipes; we can change what flows through them, and in doing so, decarbonize some of the city’s most energy-intensive buildings without major retrofits.
Just as the steam network can evolve, so can the fuels that feed it. A diversified decarbonization portfolio is what New York needs to make meaningful progress on emissions-reduction targets while repurposing existing infrastructure and allowing the market to scale renewable energy. Fuels like synthetic methane and hydrogen can be added to the mix to deliver emissions reductions without major capital changes. They’re not silver bullets, but they keep the door open for hard-to-electrify buildings while renewables expand and energy networks are upgraded and reinforced.
Hybrid district-energy systems that combine electric, thermal and renewable-gas inputs can deliver faster carbon reductions at lower cost than all-electric, building-by-building retrofits. They can also stabilize the grid by shifting demand and storing heat during off-peak hours. Crucially, they allow the city to prioritize infrastructure renewal more cost-effectively. When we electrify where the grid is strong and make targeted renewal decisions where steam systems are reaching the end of their life, systems with remaining operating life can be extended and decarbonized rather than prematurely replaced.
The court’s delay of the All-Electric Buildings Act only makes this more urgent. New York’s Climate Leadership and Community Protection Act requires a 40% reduction in greenhouse-gas emissions by 2030, and every year counts. But the pause should be used to refine, not retreat from, those goals.
New York has always led by reinvention. If we can reimagine our skyline, we can reimagine the energy that powers it. The city that built the steam age can build the clean-energy age too.
Joseph Martorano is an associate principal at Arup.
Savills has agreed to acquire New York-based Eastdil Secured Holdings in a deal that values the real estate advisory business at $1.1 billion, including debt.
The deal, which significantly expands the U.K. broker’s presence in the U.S. real estate market, will be funded with debt and the issue of new shares, according to a statement Thursday. Eastdil’s shareholders will own about 16% of the enlarged group.
Eastdil has positioned itself as a real estate investment bank, carving out a role advising some of the world’s biggest investors on the sale, acquisition and financing of complex transactions. While the firm has long boasted a track record of working on some landmark New York deals, the retreat of many Wall Street banks from real estate advisory in the aftermath of the global financial crisis allowed it to create a niche globally, working as both broker and financial adviser.
For London-based Savills, which is one of the largest real estate brokers in Europe and Asia, the deal will help it break into the business of buying and selling U.S. properties and help it compete with American peers CBRE and JLL. The firm previously acquired U.S. broker Studley in 2014, which gave it a foothold in leasing advisory in the country.
The addition of Eastdil will also help Savills to enhance its debt advisory business, a major growth area for real estate brokerages in recent years.
The ability to expand in the U.S. is “one of the attractions of the acquisition,” Savills CEO Simon Shaw said in a telephone interview Thursday. “It is a transaction that I personally wanted to do for a long time because it accelerates our push into investment banking.”
Eastdil generated revenue of about $633 million last year and underlying earnings of $113 million. The group employs 650 people across 20 offices globally and employees with equity in the business will be subject to lock-up provisions.
Savills plans to retain the Eastdil brand and will not change the firm’s compensation structure or pursue redundancies, Shaw said.
It is targeting revenue savings of at least £60 million from the deal. The $1.1 billion enterprise value represents a multiple of 9.9 times Eastdil’s underlying earnings last year.
“As part of Savills, Eastdil Secured will continue to serve as a trusted advisor and provide clients with unmatched capital markets and commercial real estate expertise, now with more resources as part of a larger organisation with complementary geographic reach and advisory capabilities,” Eastdil Executive Chairman Roy March said in the statement.
Eastdil is owned by Singapore’s Temasek Holdings, clients of Guggenheim Partners Investments and Wells Fargo. The firm’s 85 senior employees will hold a 6.3% interest in Savills on completion of the deal, which is expected in the second or third quarter of this year after regulatory approvals.
State lawmakers rejected Gov. Kathy Hochul’s proposals to overhaul New York’s system to resolve surprise medical billing disputes, fueling a battle between insurers and medical providers over how much doctors get paid for out-of-network services.
In their one-house budget proposals released Monday, the state Senate and Assembly omitted Hochul’s reforms to so-called independent dispute resolution. When doctors and insurers can’t agree on how much plans should pay for an out-of-network service, they go through a behind-the-scenes arbitration to allow a neutral third party to decide how much to reimburse.
Hochul’s budget proposal would save $56 million a year, according to the Budget Division, by making Medicaid exempt from the independent dispute resolution process and by bringing in the state’s Empire Plan. The Empire Plan covers state employees. The governor’s budget also proposes lowering the benchmark rates that are used in arbitration, tying them not to what providers charge for services but for the average rates paid by private insurers. Proponents say the shift is a more accurate representation of the market rate.
The divide between the governor and the legislature mirrors a feud between providers and health insurers over payment disputes. The governor’s reforms are backed by insurers, which complain that reimbursements for out-of-network services have skyrocketed in recent years. But doctors and hospitals say that making the arbitration system less accessible through the governor’s measures will reduce patients’ access to emergency and specialty care.
Nicolette Simmonds, a spokeswoman for the governor, said "Governor Hochul looks forward to negotiating with her partners in the legislature to reach a budget agreement that makes New York safer and more affordable.”
New York implemented the independent dispute resolution process in 2015 under its surprise billing law. The legislation preceded the federal No Surprises Act, which established a similar process to allow providers and insurers to dispute medical bills without forcing patients to get stuck in the middle.
But the state’s process is benchmarked to the high rates that hospitals and doctors charge for specific services — a sticker price that no one actually pays, said Michael Kinnucan, senior health policy adviser at the Fiscal Policy Institute, a left-leaning think tank. That has resulted in much more lucrative payments to specialty providers who see Medicaid patients out-of-network, and an incentive for physicians to stay out-of-network, he said.
“You can have kind of a bonanza if you are an out-of-network provider,” Kinnucan said. “The problem with setting up this kind of process is that over time, bad actors figure it out.”
Insurance companies say they are paying much more for specialty services such as anesthesiology and radiology through the independent dispute resolution process. Plans that cover 91% of the mainstream Medicaid population paid $116.5 million through the arbitration process in 2024 — up significantly from the $3.2 million they would have paid under the Medicaid rate, according to a survey conducted by the New York Health Plan Association, which represents insurers.
The number of Medicaid claims going through the payment dispute process have also increased. Insurers represented by the association received more than 14,000 claims in 2024, a 1,700% increase from the 778 claims they received in 2021.
In one instance, a Medicaid patient received back surgery from an out-of-network physician at a downstate hospital, for which Medicaid paid $3,000 under the fee schedule, according to the association. The provider disputed the payment and submitted a bill for $566,000, and an arbitrator determined that the surgeon should receive $514,000.
“Considering the focus that’s been placed on identifying fraud, waste and abuse, I mean this is a clear example of it,” said Eric Linzer, HPA president and CEO.
Dr. David Jakubowicz, president of the physician trade group Medical Society of the State of New York, said that insurers have “manufactured this ‘crisis,’” adding that they have previously negotiated rates with physicians. He said that insurers’ efforts to “gut access to a fair IDR appeal mechanism through the budget will only make patient access to needed emergent care worse.”
“The choice between a doctor rendering emergent surgical care at 2 a.m. versus an insurer who doesn't even have an operator available at that time is easy,” Jakubowicz said. “The legislature has wisely sided with access preservation.”
Midtown-based Dianthus Therapeutics announced a $625 million public offering this week to raise capital for anti-inflammatory drug development.
The company, which specializes in treatments for autoimmune disorders, is selling 7.3 million shares of stock at $81 per share, the company said in a statement on Tuesday. The offering is expected to close on March 12.
Dianthus is a clinical-stage biotechnology company with a focus on multiple diseases including types of neuropathy, a category of inflammatory disorders that cause nerve damage. The company went public in 2023 through a reverse merger with Cambridge, M.A.-based Magenta Therapeutics. The company has headquarters in Times Square with another site in Waltham, M.A.
Dianthus intends to use the proceeds after expenses and fees for clinical and pre-clinical development, “commercial readiness activities” and “working capital and general corporate purposes,” according to the announcement. A spokesperson for the company declined to comment.
The pricing on the public offering follows the release of 2025 financial results that showed the company had $514.4 million of cash, cash equivalents and investments at year end.
Dianthus also reported a growing net loss of $162.3 million last year, compared to $85 million in 2024. The losses were driven in part by an increase in research and development spending of 75% to $145.6 million, up from $83.1 million the year before. The spending increase was related to higher clinical costs and increased staffing for some of its drug candidates. The company’s general and administrative expenses also rose to $34.3 million, up from $25 million in 2024.
White Plains Hospital Center, part of Montefiore Health System, plans to build a new cardiac extension clinic that would mark the latest ambulatory development at one of the Bronx-based system’s Westchester outposts.
The hospital filed plans with the state Department of Health to build the 2,320-square-foot facility offering outpatient echocardiography and cardiac stress testing in Mount Kisco. The site, located roughly 18 miles from White Plains Hospital Center’s main campus, would cost approximately $1.8 million, according to the filing.
“White Plains Hospital continues to grow its services,” said spokesman Michael Gelormino. “This new location will expand access to comprehensive cardiac care for our patients in Northern Westchester.”
The so-called WPH Mount Kisco Diagnostic Center would add to the hospital’s slate of outpatient multispecialty practices peppered throughout Westchester, which include branches from Yonkers to Yorktown Heights. The health system expects it to see more than 2,500 visits in its first year and close to 2,800 in its third, the filing states. The hospital would pay for the project in cash and expects it to take around seven months to complete.
The clinic is the latest example of Montefiore hardening its footprint north of the city and follows a trend among hospital systems of outsourcing cardiac procedures or testing to ambulatory sites with less overhead. The model saves systems money by offering specialty care without having to admit patients, stay open overnight or pay for unused infrastructure.
Many of the region’s largest health systems have made similar moves. Last year, for instance, NYU Langone filed plans for a $10.5 million expansion of its ambulatory cardiac program on East 38th Street in Kips Bay. Around the same time, Northwell Health added a cardiac catheterization lab to Lenox Health Greenwich Village, an emergency department and ambulatory surgery center in the West Village affiliated with Lenox Hill Hospital on the Upper East Side.
The practice is common in the suburbs, too. In September, Catholic Health opened a 28,000-square-foot cardiac care clinic in the Long Island town of East Hills, a $12 million expansion of its St. Francis Heart Center.
But health systems are still investing in more complex hospital developments, too. White Plains Hospital Center broke ground last May on a 10-story, roughly 500,000-square-foot hospital tower that will close to double the size of its existing 292-bed hospital and add another 144 beds, for example. That facility is expected to open in 2028, according to an announcement at the time.
Brooklyn developer Tolib Mansurov is adding another project to his portfolio in the borough.
Mansurov recently filed plans with the city's Department of Buildings for a new 8-story, roughly 35,400-square-foot mixed-use building at 250 Flatbush Ave. in Park Slope.
The property would include 20 residential units, around 8,300 square feet of commercial space on the ground floor and a 20-foot backyard.
Mansurov acquired the site in February 2022 from a limited liability company for approximately $7.5 million, according to city records.
Z Architecture's Alexander Zhitnik is the architect on the project. Mansurov and his Brooklyn-based real estate firm United Elite Group did not respond to requests for comment by press time.
Mansurov made headlines in 2024 for being an alleged straw donor to former Mayor Eric Adams' first election campaign. The case was later dismissed in a highly controversial move by the Trump administration.
Mansurov has remained active in the borough since the accusation. In July he filed plans for a 99-unit residential building at 67 Fourth Ave. in Park Slope, and in September he offloaded six adjacent sites in the neighborhood to Williamsburg-based firm Borough Developers' COO Shimon Kleinman for $24 million.
The west side of a Manhattan neighborhood bifurcated by the Holland Tunnel has undergone a retail renaissance following the redesign of its streetscape four years ago.
Hudson Square, which is actually shaped more like a trapezoid than a regular quadrilateral, is generally bounded by Clarkson Street to the north, Canal Street to the south, Varick Street to the east and the Hudson River to the west. In 2022 the city and local business leaders unveiled a $13 million renovation of a portion of Hudson Street stretching from Canal to West Houston streets, reimagining the narrow and congested blocks into a boulevard with improvements including a parking-protected bike lane, more benches and wider sidewalks.
The result is exactly as they had hoped for, according to new data from the Hudson Square Business Improvement District. Last year, Hudson Street's storefront vacancy rate dropped to 17.2%, down nearly 10% from the 26.9% it was at a decade ago before the renovations, according to the BID's 2025 Storefront Inventory and Vacancy Report released Thursday.
"Hudson Square has emerged as the city's premier creative hub, attracting unique and innovative retailers that reflect the energy in the neighborhood," said Samara Karasyk, president and CEO of the BID. "Our public realm improvements have had a real impact, with Hudson Street standing as a model for how designing streets for people enhances a corridor and boosts storefront activity."
Historically an industrial neighborhood that was known as the Printing District until the mid-20th century, the area is now a hub for high-profile media and tech companies, notably Google at 550 Washington St., Disney at 7 Hudson Square and advertising agency Wieden+Kennedy at 150 Varick St. It is also home to a number of destination restaurants and upscale retailers like the restaurants César at 333 Hudson St. and Mishik at 259A Hudson St., along with furniture store From The Source at 311 Hudson St.
The business improvement district, which formed in 2009 and expanded several years later, broke ground on the redesign in 2020 through a partnership with the city's Economic Development Corporation and Department of Transportation.
Following a pandemic-induced hiatus, the entire project was completed in the summer of 2022 and celebrated by elected officials, including then-Mayor Eric Adams.
"This project has transformed Hudson Street into a model of urban design — securing roadway space for cyclists, enhancing the pedestrian environment, and unlocking public space. We are taking the dream of a livable and sustainable city and turning it into reality," Adams said at the time.
The improvements focused primarily on the west side of Hudson Street, which boasted the district's lowest vacancy rate of 6.3% — nearly half of the citywide average of 11.1%, and far lower than the Manhattan average of 14.2%, the report says.
Overall, Hudson Square's storefront vacancy decreased from 26.9% in 2023 to 22.4% in 2025 — a decline that happened at the same time the number of storefronts in the neighborhood increased, jumping from 145 to 170, or 17%, over the last decade, according to the report, which was published by Jacob McNally, the BID's vice president for planning and capital projects.
The stretch of Spring Street that runs through the neighborhood, however, had a still-high vacancy rate last year of 47.8%, making it the BID's next target location for a redesign.
"This corridor-level pattern reinforces Spring Street as a priority area for targeted strategies, public realm interventions, and potential rethinking of ground-floor configurations," McNally wrote in the report.
New York Giants co-owners Steve Tisch and his two siblings are transferring their stakes in the team to trusts for their children, according to people familiar who couldn’t speak publicly.
The move, which has to be approved by the NFL, will shift ownership of a franchise valued last year at $10.3 billion. It would also come after Tisch recently appeared in documents tied to the investigation of convicted sex offender Jeffrey Epstein.
The NFL didn’t respond to a request for comment. The New York Giants declined to comment.
ESPN reported the proposed transfer earlier. The outlet said according to a league memo it obtained that the combined stake of the Tisch siblings totaled about 23%.
Sports team owners routinely shift their stakes to the next generation. Steve Tisch is 77 years old and joined by siblings Jonathan and Laurie in pursuing a transfer.
Steve Tisch hasn’t been accused of any crimes. He was mentioned hundreds of times in Epstein documents released earlier this year. Their email correspondence spans from simple pleasantries to vulgar discussions and plans for Epstein to set up Tisch with women.
“We had a brief association where we exchanged emails about adult women, and in addition, we discussed movies, philanthropy, and investments,” Tisch said in a statement in response to the emails in January. “I did not take him up on any of his invitations and never went to his island. As we all know now, he was a terrible person and someone I deeply regret associating with.”
NFL commissioner Roger Goodell told reporters in February the league would “look into” Tisch’s dealings with Epstein but stopped short of saying it would open an investigation.
The Tisch family originally purchased 50% of the New York Giants for $75 million from the Mara family in 1991. Julia Koch and her family joined ownership last year after buying 10% of the franchise.
Moody's Ratings lowered its outlook on New York City to negative, citing "sizable and persistent" expected budget gaps.
The ratings company affirmed its Aa2 rating on the city, the third-highest level of investment-grade. Moody's said the change came after the city's spending expectations showed larger budget shortfalls than previously forecast.
"The negative outlook reflects the emergence of sizable and persistent projected budget gaps that signal underlying structural imbalance and reduced financial flexibility, despite New York City's still favorable economic conditions," Moody's analysts wrote in a Wednesday note.
New York City Comptroller Mark Levine said in a press release that the city was facing a structural imbalance that puts its long-term fiscal stability at risk.
Levine said that the city's operating expenses are projected to be $4.53 billion higher than its revenue in fiscal 2026.
A proposed property tax increase floated by Mayor Zohran Mamdani would put the levy near its limit, Levine said.
"Moody's decision to revise New York City's outlook to negative is a sobering wake-up call about the fiscal challenges ahead for us," Levine said in response to the outlook cut.
Newly sworn-in Comptroller Mark Levine laid out steps the city can take to get back on sound financial footing — notably, without increasing taxes — at a Crain’s event on Wednesday.
"We have the option of finding more efficiencies and savings and getting more fiscal help from Albany," Levine told a crowd of business leaders at the New York Athletic Club.
"It will be politically challenging," he said, but there are cuts across city government that can and should be made, including to some rental assistance and education programs.
He specifically noted CityFHEPS and so-called Carter Cases, in which the city pays private school tuition for special needs students. He said both programs are immensely helpful to many New Yorkers, but their costs are rising at unsustainable rates.
"I don't think we can get to our goal without looking at curbing the growth of some of these programs," he said.
Levine also said the state must fork over more cash to the five boroughs through its Aid and Incentives for Municipalities, or AIM, program, which the city was cut off from in 2010.
"If we got per capita relative to other cities, you'd get $2 billion a year," Levine claimed.
He also said the city must continue growing its economy so tax revenue increases on its own.
"Growing the economy is the best way to ensure we have the revenue to meet the needs of vulnerable New Yorkers," Levine said.
The comptroller believes that if all that happens, the city can return to healthy financial footing without raising property or income taxes.
"I don't think those are our only choices, and I think there are big downsides to both," Levine said of the ongoing debate among Democrats over whether to raise income, property or corporate taxes.
The comptroller's stance contrasts with that of Mayor Zohran Mamdani, who says a tax hike is necessary to balance the city's budget.
"I would consider property taxes to be the last resort," Levine said. The existing property tax system is already "very unequal," and increasing the rate would only "compound that inequality."
He said he generally believes in progressive income taxes, particularly amid growing inequality, but prefers them at the federal level to "avoid localities playing off each other, which is an increasing worry as people are more mobile."
Before the event, Levine told reporters Tuesday that his office is still analyzing the city's fiscal needs relative to such a tax. On Wednesday, however, he said his "goal is just to close the gap, and I think actually we can do it without those measures," referencing tax hikes. He said he plans to continue to have discussions on the subject with his colleagues in Albany.
Levine is likely picturing cuts and Albany funding significantly more substantial than what Mamdani envisions, given that the comptroller's revenue projections are more conservative than the mayor's, yet he believes the city can close its budget gap before the June 30 deadline without raising taxes.
Gov. Kathy Hochul has said explicitly she does not believe tax increases are necessary right now. Levine was less dismissive in his remarks and sounded more in line with folks like City Council Speaker Julie Menin, who on Tuesday said of the income tax push "it's good that they're putting everything on the table" but "there are many other areas that should be on the table as well."
Beyond balancing the budget, Levine discussed the city's housing shortage, criticizing bureaucratic delays that cause year‑plus timelines for some development approvals. He said the city must modernize its "pen and paper" processes. The comptroller also warned private‑sector job growth has stalled, especially for young white‑collar workers.
"I'm incredibly bullish on the future of New York City," Levine said. "We're just going to have to do some tough work politically in the next three and a half months to avoid the worst outcomes."
Lenox Hill Hospital is planning to lay off more than two dozen EMTs and paramedics as it cuts back ambulance services in Upper Manhattan, according to the workers’ union.
The Upper East Side hospital, which is part of Northwell Health, notified the ambulance workers Wednesday that they would lose their jobs within the next 30 days, stating that the decision stems from the “operational needs of the hospital,” according to a copy of the termination letter obtained by Crain’s. The hospital plans to lay off 31 EMS workers, including 15 full-time and 16 part-time staff, according to 1199SEIU, which represents them.
Lenox Hill is laying off workers as it scales back its ambulance fleet. The medical center is getting rid of three ambulances that cover the Upper West Side, starting at 72nd Street and stretching up to Washington Heights, according to the Emergency Medical Services Public Advocacy Council, a nonprofit that advocates for EMTs and paramedics. The hospital’s remaining five ambulances primarily serve Harlem and the Upper East Side, according to the nonprofit. CBS News was first to report the layoffs.
The cuts come as hospitals citywide reduce staffing and curtail services in anticipation of looming federal funding reductions. Hospitals in New York are bracing for an $8 billion annual hit from the One Big Beautiful Bill Act, according to estimates from hospital lobbying groups, leading a number of medical institutions to preemptively lay off workers and tighten their budgets to soften the blow.
Joseph Kemp, a spokesman for Lenox Hill Hospital, confirmed that the facility decided to modify a few ambulance units after a “comprehensive evaluation of our ambulance utilization and deployment within the FDNY EMS system.” While the bulk of ambulances that respond to 911 calls in the city are operated by the Fire Department, private hospitals, including Northwell, also supply their own vehicles, EMTs and paramedics to bolster the city’s emergency system.
“This adjustment is intended to further optimize the efficiency and effectiveness of our operations within the greater New York metropolitan community, while reinforcing our continued position as one of the largest and most reliable providers of emergency medical services in the region,” Kemp said.
Northwell has gradually reduced ambulance coverage in the past few years, cutting tours in Queens and on Staten Island in 2023, the New York Post reported. The cuts to Lenox Hill come a few months after the Fire Department implemented new rules that require EMTs and paramedics to transport patients to the closest hospital – not the hospital of their choice. That rule could result in fewer trips to hospitals from neighborhoods that aren’t within a couple of blocks from their campus.
Jahrodney Williams, a paramedic at Lenox Hill and an 1199SEIU union delegate, said that the decision to pull ambulances off the streets is “short-sighted,” noting that it could increase burden on other workers and increase wait times.
“It’s going to create a vacuum effect on an already-stretched 911 system,” Williams said. “If you remove three ambulances on the Upper West Side, someone is going to have to fill that void.”
The union is demanding that the hospital reverse the layoffs, calling them "disrespectful" to EMTs and paramedics and harmful to patients on the west side of Manhattan.
"These dedicated first responders should not bear the burden of our city's broken 911 system," said Rose Ryan, a spokeswoman for 1199SEIU. "Choosing to lay off these dedicated first responders is wrong and harmful - and we demand Northwell reinstate the impacted workers."
Oct. 10, 2025: The union previously stated that 18 workers would be impacted by the layoffs. The story has been updated to include the accurate number of workers that will be affected by the layoffs, and a statement from 1199SEIU.
Just two weeks after getting the green light to break ground on a long-touted Midtown skyscraper, the developers behind the project have filed plans to demolish two of the buildings standing in its way.
Richard Concannon, vice president of operations at Rudin, and David Bellman, executive vice president at Vornado Realty Trust — the two firms spearheading the project alongside hedge fund magnate Ken Griffin — submitted permits to the Department of Buildings Thursday to demolish 40 E. 52nd St. and 350 Park Ave. on the site of the proposed tower, records show.
The new, 62-story tower would be given the address 350 Park Ave. and replace three existing buildings on the site, including the 31-story building currently located at that address, between East 51st and East 52nd streets, and the 23-story building located at 40 E. 52nd St.
A 5-story building located at 39 E. 51st St. would also need to be demolished to make way for the project, but permits for it have not yet been filed, records show. The majority of the existing footprint is already vacant, and the new building is expected to come online in 2032.
Griffin's firms, Citadel and Citadel Securities, would serve as its anchor tenants, occupying at least 850,000 square feet of the roughly 1.7 million-square-foot skyscraper.
The estimated cost associated with the demolition work for the two buildings is $40 million, records show, although the final price tag is often significantly higher. The tower itself would cost an estimated $4.5 billion to build.
Mayor Eric Adams last April announced that the project was finally ready to move forward after years of anticipation, saying it would "energize Midtown Manhattan as the world's most important business address." Its lengthy review process finally kicked off in March, and the City Council late last month voted unanimously to approve plans for the 62-story tower.
The project has been in the works since at least 2019, when Vornado and Rudin first revealed they were considering building a 1,450-foot tower on Park Avenue, Crain's reported at the time.
A representative for the project declined to comment.
New York City will require the landlords of more than 100,000 buildings to conduct twice-yearly inspections of steam radiators under a law that passed Thursday. The new rule will apply to apartments with young children, a direct response to the death of a Brooklyn infant from a radiator leak last year.
The bill, introduced by Flatbush Councilwoman Farrah Louis, requires landlords to hire a specialist or have a superintendent inspect steam radiators twice yearly in apartments with a child under age 6. Building owners must file a report with the city’s Department of Housing Preservation and Development and make any necessary repairs within seven days. If an owner fails to contact tenants or share inspection records with the city, they’ll face multiple $500 fines. The new requirement is designed to protect tenants from unsafe conditions and saddles property owners with new compliance costs.
Louis described the new requirement as “a common sense and lifesaving measure” that would hold landlords accountable for promptly repairing faulty radiators. City Hall, however, says it is skeptical of the bill. The Mayor’s Office of Management and Budget said that it would likely cost more than $122.4 million for the city’s housing agencies (HPD and the New York City Housing Authority) to comply with the law’s requirements and to inspect steam radiators at its properties.
The Adams administration pushed for changes that would have required landlords of all apartments with steam radiators to conduct inspections from a licensed professional (without the option of relying on a superintendent) every time an apartment became vacant. The change would have resulted in fewer apartments receiving bi-annual inspections.
“We must be responsive to the crises that continue to endanger families in their own homes,” Louis said in a statement. “The administration [must] fully and swiftly implement this law so that every New Yorker, regardless of where they live, can count on safe, well-maintained housing.”
Louis introduced the bill following the January 2024 death of 11-month-old Binyomin Kuravsky in his Midwood home after a radiator erupted steam in his room.
A spokesman for Mayor Eric Adams, Daniel Marans, said HPD officials “look forward to working with the City Council to advance a plan that prioritizes the safety of children, their families, and all New York City renters.” The mayor’s office declined to comment on if it’ll veto the bill; the legislation has the support of 34 council members and, in theory, could override a mayoral veto.
In testimony to the City Council, AnnMarie Santiago, HPD’s deputy commissioner of the office of enforcement and neighborhood services, said the bill would be “time and resource intensive” for the agency to carry out. Santiago said this is namely because the agency must create a public portal and submission process for building owners to submit annual reports on steam radiators. Additionally, new staff would be required to manage the process.
The legislation will also likely create an “administrative and cost burden” on private property owners, especially those of older buildings, added Santiago.
“Some of these property owners are already struggling to meet the expenses associated with existing mandates,” said Santiago.
Meanwhile, influential trade group the Real Estate Board of New York says it supports the bill.
REBNY’s vice president of New York City legislative affairs, Dev Awasthi, told Crain’s that the law is a critical safety measure and urged the mayor’s office to move forward with the law.
“We applaud Councilmember Louis for engaging a wide range of stakeholders to produce strong new legislation to improve apartment safety and help prevent unspeakable tragedies related to malfunctioning radiators,” said Awasthi. “We hope elected officials will advance this bill without delay.”
The law is set to take effect next spring.
For several years now, bad actors within the licensed New York marijuana market have been not-so-secretly smuggling in raw wholesale cannabis — and in many cases finished manufactured products — with which to stock newly-opened dispensary shelves in the Empire State, a brazen shattering of state rules known within the trade as “inversion.”
Marijuana oversupply from states such as California, Colorado, Maine, Michigan, and Oklahoma has been flowing freely into New York, several industry sources told Crain’s New York Business, and despite warnings from those in the industry to both regulators and lawmakers, precious little has yet been done about it, business owners complain.
Sometimes, the rulebreaking was so obvious that dispensaries — licensed or otherwise — would simply add their own slapped-on labels on top of marijuana product labels shipped illegally from California or other states, industry experts told Crain's.
The issue has blossomed into an open secret among those in the industry, but it’s become so pervasive as the New York marijuana trade has matured that it’s threatening to undercut the entire system, insiders say.
“If you ask me, it’s the number one problem we have,” said John Vavalo, CEO of Syracuse-based Central Processors NY, and the head of the Association of New York Cannabis Processors.
Vavalo said inversion is the “elephant in the room” for companies such as his and others trying to play by the rules.
“For the last two years, I’ve been waving that flag and jumping up and down,” Vavalo said. “It’s happening at all levels. Farmers are inverting stuff, processors are inverting.”
Most product sold
Vavalo estimated that at the bare minimum, at least half of the cannabis products sold in New York since the recreational market launched in 2022 were “inverted” from illegal out-of-state marijuana, particularly raw marijuana flower, which is typically sold in eighth-of-an-ounce bags or jars.
But the reality is the amount of inverted products sold legally at New York dispensaries is probably far higher than that, he and other insiders said, contrary to how New York marijuana shops are supposed to only sell cannabis grown in-state.
“This is an existential threat,” Vavalo said. “Probably 80% of this market is just fake.”
Joseph Calderone, the president of the New York Cannabis Farmers Alliance, said he and scores of other licensed farmers didn’t even bother planting any marijuana crops this year, or severely scaled back their production, because illegal inversion prices undercut their legally-produced marijuana, making it a losing proposition for many of them to even grow at all.
Calderone also echoed Vavalo's estimate as to how much of the legal market products have been illegally inverted, which is eye-opening given that New York earlier this year surpassed $2 billion in legal marijuana sales.
Calderone, who also runs Grateful Valley Farms, estimated that around 50 of the 516 licensed cultivators either “cut back” or didn’t plant at all. That includes his farm, which didn't plant any cannabis this year. And he said that inversion is causing serious price compression in the supply chain, from about $4,500 per liter of cannabis biomass to about $2,500 per liter.
“Inversion started from the beginning in New York,” Calderone said, adding that there was so little industry oversight that some executives from large New York marijuana companies were openly “bragging about bringing in inverted California weed” to sell.
“At one point, he bragged about bringing in 5,000 pounds,” Calderone said. “That was a couple years ago.”
Since then, Calderone said, the problem has only worsened as more and more legal dispensaries have opened in New York. As of Oct. 3, there were 497 recreational marijuana shops spread around New York State, with many more in the pipeline.
Inversion is such a hot-button issue that a newly formed cannabis trade organization called the Green Standard Alliance released a new white paper this week about inversion, complete with several specific suggestions for policymakers on how to potentially correct the problem so that the market will reward good actors and punish rulebreakers.
The paper identified a handful of possible inversion cases in which state regulators have taken action — including a recall in June for products from IndoGro LLC that had been improperly sourced from out of state, and a $2 million fine for Lexachrom Analytical Laboratory after it failed to provide lab test results for cannabis goods to the state.
Those examples were just the “tip of the iceberg,” however, Calderone said.
“Those are just examples that were made, because if you really get to who’s doing inversion, and who’s been doing it egregiously and nefariously, then you’d have a complete collapse of the industry and I think you’d have (racketeering) cases, and the federal government would get involved,” Calderone said.
Calderone added that the situation is so dire that some mom-and-pop cannabis companies he knows are actively hoping for the U.S. Department of Justice to intervene somehow.
Perhaps not coincidentally, former New York Office of Cannabis Management regulator Damian Fagon also published an op-ed in Marijuana Moment detailing the problem as well, and calling for regulators to step up their enforcement game with respect to licensed companies guilty of inversion.
The white paper from GSA, partially authored by lobbyist Joe Rossi, asserts that what the industry needs first and foremost is more accountability.
Rossi said the new white paper — which has been shared with lawmakers, the governor’s office, and the OCM — had been in the works for about a month.
The OCM did not respond to a request for comment for this story.
But two state lawmakers who have led the charge for years in cannabis policy in Albany — House Majority Leader Crystal Peoples-Stokes and state Sen. Jeremy Cooney — indicated in statements that they’re open to adjusting marijuana policy at the state level.
“I want to be unequivocal in my support for New York State farmers and the New York cannabis industry. Cannabis inversion hurts the entire cannabis industry and I support the measure being taken to crack down on this problem,” Peoples-Stokes said in an emailed statement.
Sen. Cooney, in an email, added, “I’ve long believed that the only way for our legal cannabis market to be successful is if consumers can fully trust the safety and reliability of the products they’re buying. I’m currently reviewing the (GSA) report and will explore what actions might need to be taken to ensure only legal products are hitting our shelves.”
Rossi said one of the most important steps lawmakers can take is to codify “inversion” into statute in order to make it easier for the OCM to crack down on those engaging in the practice, which he said right now is tough to nail down.
“Codifying the word inversion and its penalties into the statute would make this tremendously easier to basically enforce against inversion,” Rossi said. “Currently, the regulars have to have a rock-solid case that this is inversion or else nothing may happen… What the argument is, is to make it easier and shift the burden onto the processors to prove those traceability issues aren't inversion.”
More accountability in the cannabis space also means more enforcement by the OCM and its Trade Practices Bureau, apart from getting a new seed-to-sale tracking system implemented, which is thus far on track to be operational in December, Rossi said.
But the GSA’s paper also calls for several other steps that would require changes to state law, and it’s not clear yet if there’s the political will in Albany to get such proposals codified in statute.
Specifically, the paper calls for new penalties to be codified in law for the crime of inversion, including hefty fines and license revocations. The paper also proposes information-sharing with other states so different state governments can collaborate on cracking down on illegal marijuana smuggling, truth-in-labeling statutes for marijuana product packaging, increased mandates for cannabis product ingredient disclosure, and new whistleblower protections for those in the industry who want to inform on rulebreakers.
Vavalo said the white paper is a “good start,” but that many of its proposals are already set in law or industry regulations, and he’s not overly optimistic that state lawmakers will take action on the GSA’s new proposals.
Calderone said his organization’s preference would also be first to have a major third-party audit of the entire legal cannabis supply chain, to look at all production and reporting records from farmers, processors and other suppliers, and to compare those numbers with sales figures from dispensaries, in order to identify where the real discrepancies lie.
Calderone and Vavalo also expressed both hope and skepticism that a new seed-to-sale inventory tracking system — which is supposed to be online in December, run by Florida-based Metrc — will truly solve the inversion problem.
Metrc “can’t stop product coming from California,” Calderone said, referring to a four-year-old lawsuit still ongoing in that state, over allegations that marijuana regulators there have turned a blind eye toward illegal cannabis diversion to states such as New York.
California regulators have also refused to share Metrc inventory tracking data with the industry or the public, claiming the data is confidential. There have also been several other key lawsuits alleging major flaws with the Metrc tracking system, which means its implementation is somewhat cold comfort for operators like Calderone.
In the same vein, Vavalo said, New York regulators have thus far also refused to share mandated biweekly inventory reporting data from growers with stakeholders like him, so there’s been no good way to solidly confirm the size and scope of the inversion issue.
“I don’t think anyone’s looking at any data,” Vavalo said of the OCM. “Otherwise, wouldn’t they have sent it to us when we asked for the data? … The numbers would tell them what to do. They have the data. They have everybody’s production reports. Stuff they’ve never shared with anybody.”
But if something isn’t done before long about the inversion problem, Vavalo and Calderone predicted, the legal market simply won’t last, at least as it was intended to as a state-siloed structure without any imports from other saturated marijuana markets.
“The problem is that's not what's going to be the best thing for the market long term, because even the market compression in price, that's just driving more people to invert because the price is coming down too fast, too early,” Vavalo said.
“So the farmers are never going to be able to make enough money to reinvest, to do better and make better products, and therefore we end up with a system that's going to be reliant wholly on imported product.”
Office leasing in Manhattan is its strongest in 20 years, with big names including Deloitte, Salesforce and WeWork soaking up large blocks of space. Yet the share prices of the city’s commercial landlords have performed poorly this year.
The share price of SL Green, New York’s biggest office owner, has so far shed 17% of its value in 2025 and underperformed its peer group by nearly 900 basis points since April 1, according to brokerage firm Evercore ISI. Vornado Realty Trust’s has lost 7%. Empire State Realty’s has fallen by 30%, and BXP’s has lost 5%. Investor focus is shifting from leasing activity to the rising cost of larger development projects, while there are always questions over interest rates and if they’ll continue to drop.
Starting Wednesday these companies have a chance to change the narrative, when SL Green reports quarterly results. Others follow in the next few weeks. Here are some of the questions investors will want answered:
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- What did it cost SL Green to not get a casino license? Evercore’s Steve Sakwa attributes the stock’s poor performance in part to its bid for a Times Square casino going down in flames. The prospect of a Zohran Mamdani mayoralty is also weighing on the stock, understandable considering SL Green’s 30 million-square-foot portfolio is in Manhattan. Sakwa thinks such concerns are overdone and said in a client note this week that Mamdani has shown a “more pragmatic approach” since winning the Democratic primary in June.
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- Empire State Realty Trust’s stock has fallen thanks to a TK drop in visits to the observatory at the Empire State Building, one of New York’s top tourist attractions. If the decline continues, that would be news because most indicators show tourism is healthy.
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- Has anyone leased space in the $2 billion office tower from BXP rising at 343 Madison Ave.? Does anyone want space in the firm’s 360 Park Ave. South, a newly renovated Flatiron District tower that’s 72% empty?
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- Vornado Realty Trust acquired the office tower at 623 Fifth Ave. last month for what seems like a bargain $218 million. What kind of return does management expect on redeveloping the building?
As a group, heading into the week of Oct. 6 real estate investment trusts were down 1.5% for the year, compared with a 14% rally for the S&P 500 and 18% for Nasdaq. Piper Sandler analyst Alexander Goldbarb argues it’s a buying opportunity.
“We get that REITs are not crypto, AI or meme-stocks, but the group has some of the best fundamentals in decades, with minimal supply, near full occupancies, growing demand and the Fed cutting rates,” he said in a report this week. “Managements need to focus fully on driving earnings and dividend growth. Same-store [net operating income] is meaningless if it doesn’t translate to increased cash flow.”
Hackensack Meridian Health is ramping up its Amazon One Medical partnership to expand primary care as part of its outpatient push.
The Edison, New Jersey-based health system is set to open its third One Medical facility in the second quarter of next year, Hackensack CEO Bob Garrett said. Hackensack initially aimed to open 20 clinics over 10 years but plans to move faster and expand that target given the partnership’s success, he said.
Amazon in 2023 acquired virtual and brick-and-mortar primary care service provider One Medical for $3.9 billion. Amazon has since partnered with health systems across the country to grow the subscription-based model for commercially insured patients, helping boost systems’ specialty care referrals.
The Amazon affiliation is part of Hackensack’s $500 million outpatient expansion over the past five years, Garrett said. The 18-hospital system also teamed up this year with India-based hospital operator Apollo Hospitals to try to fuel its growth through a virtual nursing initiative.
In an interview, Garrett said Hackensack is also working through stricter federal immigration policies, as well as a government shutdown that has impeded its hospital-at-home program. The interview has been edited for length and clarity.
How is the One Medical partnership progressing?
One out of three New Jerseyans do not have access to primary care doctors. There are multiple strategies to expand our primary care network, and one is through this partnership.
Amazon moves quickly. They have a good hands-on model. Patients are getting appointments very quickly, and if they need follow-up care, we have a list of Hackensack Meridian specialists who primary care doctors can refer patients to. It has been pretty seamless and the patient experience feedback has been positive.
Why do you think the partnership is growing so quickly?
I think it’s the combination of real estate being available and the two teams working so well together. Our demographic information on where there’s a lack of access and their information seems to jibe. Culturally, it’s a good fit.
How does the affiliation fit into Hackensack’s outpatient push?
We plan to invest about $500 million in expanding our ambulatory care network, including primary care, specialty care, urgent care, ambulatory surgery and outpatient cancer services. We’ve opened health and wellness centers, which house a lot of those services under one roof, as well as satellite offices around the state.
Several initiatives complement the One Medical partnership. Our medical school scholarship program incentivizes students to go into primary care. We have a partnership with K Health that provides 24/7 access to a virtual primary care provider. We also have the Hackensack Meridian Health and Wellness Center at the Woodbridge Metropark station that should be ready in February of next year.
What’s new with the Apollo Hospitals partnership?
It has been very positive. The only things that have been holding us back are the fees and limitations of the H-1B program. This administration has been pretty tight on immigration. But we have a meeting coming up with Centers for Medicare and Medicaid Services leadership to try to work through those issues. They seem open and receptive to this program and understand there is a shortage of nurses in New Jersey.
Apollo Hospitals and Hackensack Meridian Health know how this could work and how it could benefit both organizations, but we have to work through the visa process.
What’s the risk of limiting immigration?
The biggest risk is worsening the shortage of nurses and physicians, particularly around primary care doctors who might want to come over and practice. We’ve seen new immigration policies even impact some of the technical areas such as imaging technicians and pharmacists.
We’re trying to attract international companies to come to places like New Jersey. But if there are restrictions for international workers, it’s tougher for those companies to make those investments. It has a ripple effect throughout the entire economy.
Has the government shutdown impacted Hackensack’s hospital-at-home program?
As the government shutdown got closer, we sent out letters and made a plan to transfer patients to an inpatient setting.
It has been pretty seamless and we haven’t heard negative feedback. Patients were enjoying the experience at home, but they understood that this is well beyond our control.
We’re working the financial piece out with our partner Medically Home, now part of DispatchHealth, in case this goes on for an extended period of time. We’re hoping it is going to be short-lived. Our systems are in place so that we could relaunch the program the same day the government reopens.
Does the shutdown strain inpatient capacity?
There is no doubt about it. The hospital-at-home program frees up beds for more acute care, and now patients that were being treated at home are taking up those beds. We haven’t seen a significant increase in wait times yet in our emergency department. But if the shutdown goes on, that may happen.
Has the shutdown impacted telehealth services?
It has, but we’re still going ahead with our telehealth services. We’re not able to bill Medicare now. But we’re hoping that once this gets resolved, we’ll be able to back-bill for services.
We certainly don’t want to curtail those services. That’s a lifeline for a lot of people. That’s their connection to their provider.
One of the city's largest residential property owners is facing foreclosure at a dozen of its buildings in Queens, records show.
Midtown-based A&E Real Estate, which was founded in 2011, has allegedly defaulted on a $165 million loan tied to 12 properties in Kew Gardens, according to a lawsuit filed in Queens state Supreme Court this week. The 12 buildings are located on 72nd and 73rd roads, 73rd and 75th avenues and Kissena Boulevard, and contain more than 1,200 units.
The lawsuit does not name a specific individual and was filed against the limited liability company Kew Gardens Hills, which took out the original $165 million loan in 2021 from now-defunct financial institution Signature Bank, records show. When Signature collapsed in 2023, the Federal Deposit Insurance Corp. assumed its debt, and it was ultimately assigned to the plaintiff, SIG RCRS A/B MF 2023 Venture LLC, which is being managed by Boston-headquartered Santander Bank.
A&E was served a notice of default on Feb. 14, documents show. The developer did not respond to a request for comment by press time but told PincusCo, which first reported on the filing, that it's in discussions with Santander and hopes to come to a resolution soon.
Joel Haims, Bradley Cohen and Chenjia Zhu, attorneys at Midtown-based law firm McDermott Will & Schulte, which is representing the plaintiff, also did not respond to a request for comment by press time.
This isn't A&E's first foreclosure proceeding. The developer has apparently run into challenges at a number of its properties, including at Riverton Square in Harlem, where it allegedly defaulted on a $506 million mortgage tied to the portfolio, Crain's reported in May. A report from Moody's said A&E simply couldn't keep up with the bills because its operating expenses have risen three times faster than its revenue since 2021. Overall, the firm owns 12,000 apartments citywide.
A Canadian real estate investor appears to be in financial hot water on the home front.
Daniel Gryfe, the managing partner of Toronto-based Precise Capital Management and its U.S. subsidiary, Mbark Global, has allegedly been in default since March on two mortgages for a pair of side-by-side apartments at the Apthorp condo on the Upper West Side, some lawsuits claim.
In the most recent suit, filed Thursday in Manhattan state Supreme Court, JPMorgan Chase accuses Gryfe and his wife, Dena, of owing $1.8 million for their two-bedroom apartment at the building, a prewar condo at West 78th Street and Broadway, and is seeking to possibly foreclose on the unit to resolve the debt.
And in September the same bank alleged that the couple also owes $4.7 million for a different defaulted loan for their next-door six-bedroom apartment, which JPMorgan could also auction off through foreclosure, based on a court filing.
In summer 2022 the Gryfes paid $12.3 million for the two units in separate transactions, based on the city register. At the time the homes were being marketed together, noting they could be combined into an 8,000-square-foot spread that would have been “the largest renovated home ever offered for sale at the historic, landmarked Apthorp,” the ad said.
It’s not clear if the Gryfes, who technically bought the units through the shell company Krabm West End, ever merged them. But since acquiring the residences, the couple has used the sweeping homes as collateral for a series of mortgages, according to the register.
The two loans at the heart of the current cases date to 2022. First Republic Bank was the original lender for both; it assigned the debt to JPMorgan the following year, the register shows.
The Gryfes, who have not yet filed answers to the complaints and could not be reached for comment by press time, face other financial challenges at the Apthorp. Its condo board is accusing them of failing to pay common charges.
In March, the same time the couple allegedly stopped making mortgage payments, they also apparently halted writing checks for upkeep fees at the luxury tower and as of May owed at least $42,000, according to liens filed in the register.
An heir to a multigenerational, century-plus-old bagel bakery in Toronto who chose to go into real estate instead of the family business, Daniel Gryfe has snapped up properties in Arizona, Chicago and Florida over the past decade, according to a 2014 Bisnow profile and other clips.
But he has trimmed some of that portfolio recently, unloading a Miami Beach mansion in 2024 for $18 million after paying $12 million for the 12,800-square-foot Depression-era house three years earlier, The Real Deal reported.
Gryfe is also battling a commercial lender, New York-based JLJ Capital, which claims he has not made a single payment on a $3.2 million legal settlement from April that came after the two sides had a fallout over an Arizona office building project, court filings show. That case is scheduled to go to trial in Manhattan state Supreme in November.
After attending business school in the city, Gryfe worked in New York as an investment banker but returned to Toronto in 2008 to begin pooling private funds to invest in local apartment complexes. He then sold those sites for capital to acquire U.S. commercial and residential buildings, according to a bio compiled for a 2019 Canadian conference for high-net-worth investors.
At the time Precise and Mbark had completed more than $500 million worth of transactions and had an additional $100 million planned, the bio said.
One of New York's best-known residential buildings, the Renaissance Revival-style Apthorp has been home over the years to a list of VIPs, including singer Cyndi Lauper, actor Al Pacino and writer Nora Ephron.
Deborah Gallo, the lawyer with Midtown-based firm McCalla Raymer Leibert Pierce who is representing JPMorgan in the suits, did not return a phone message for comment by press time.
A major New York development team is hoping to take advantage of interest in the city's red-hot retail market by selling a portfolio of six storefronts across Manhattan and Brooklyn for $60 million.
CBSK Ironstate is putting the retail portions of 10 Bond St. and 363 Lafayette St. in NoHo, 280 Metropolitan Ave. and 178 N. Fourth St. in Williamsburg, 71 Reade St. in Tribeca and 591 Third Ave. in Murray Hill on the market, according to marketing materials and sources familiar with the deal. The units span roughly 30,000 square feet overall and are completely leased up to tenants including One Medical, City MD, Douglas Elliman, cannabis wellness firm Valley Agriceuticals and apparel firms ON-Running and Boglioli.
All six condos are located at the base of fairly new residential or mixed-use projects and would be available individually or as a package. A Newmark team led by Adam Doneger and Brett Siegel is handling the sale.
Doneger declined to comment on the portfolio, and representatives for CBSK Ironstate — a partnership of Manhattan real estate firms SK Development and CB Developers and New Jersey-based real estate firm Ironstate Development — did not respond to requests for comment about it by press time.
The properties are hitting the market at a strong time for New York retail, which may help explain why CBSK Ironstate is trying to sell them now. The city's retail availability rate was a record low 14.2% during the third quarter, while the average asking rent increased year over year to $577 per square foot, according to data from JLL. In Williamsburg specifically, the average asking rent rose to $322 per square foot, while in SoHo, it rose to $352 per square foot.
Other projects in CBSK Ironstate's portfolio include a luxury residential building at 1228 Madison Ave. on the Upper East Side and a Hell's Kitchen mixed-use project called The West. The team completed several of the developments it is now marketing in 2016, including 10 Bond St., 280 Metropolitan Ave. and 71 Reade St., also addressed as 87 Chambers St.
This story has been updated to clarify that SK Development owns the retail properties as part of CBSK Ironstate.
Business people dumped more than $1 million on two super PACs supporting Andrew Cuomo’s mayoral campaign in the days after Eric Adams withdrew from the race, according to new disclosures. The ramped-up donations show some wealthy executives have grown more optimistic about Cuomo’s chances of beating Zohran Mamdani in November — although polls suggest the democratic socialist remains the heavy favorite.
The latest pro-Cuomo donors included casino mogul Steve Wynn, who gave $500,000 on Oct. 7 to the Fix the City PAC — the fifth-biggest check that it has received since its inception this spring. A separate PAC, New Yorkers for a Better Future Mayor 25, received $100,000 from billionaire real estate developer Joseph Cayre the day after Adams’ Sept. 28 dropout; and $50,000 on Oct. 1 from United American Land, the company owned by the Laboz family of landlords.
All told, Fix the City has raised $933,000 in less than two weeks since Adams dropped out, while Better Future reported $281,000 — working out to nearly a quarter of the total money each PAC has raised since the June primary. Before Adams' exit, the pro-Cuomo PACs struggled to attract big donors who viewed Cuomo as unviable in the four-way race and did not want to waste their money.
“Eric Adams dropping out definitely provided a clearer state of mind for potential donors and gave them a real path to victory for Andrew Cuomo,” said Jeff Leb, the treasurer of the Better Future PAC. (Leb said the group has raised a total of $340,000 since Adams dropped out, but not all has been publicly reported).
Cuomo’s own campaign has seen a similar upward trend, disclosing last week that it raised about $390,000 in 36 hours after Adams withdrew. And a Quinnipiac University poll published Thursday showed Cuomo gaining 10 points without Adams, validating the ex-governor’s hopes that he would claim most of the incumbent mayor’s votes — although the poll showed Cuomo still trailing Mamdani, 46% to 33%.
Cuomo also continues to lag Mamdani by nearly $5 million in campaign fundraising — a gap that may only increase the importance of outside PACs.
Those two Cuomo PACs have only spent about $1 million so far for the general election, largely on leaflets and internet ads. That’s a far cry from the record $23 million that Fix the City spent for Cuomo’s failed primary campaign, which went mostly to TV ads that appeared ineffectual.
“With just over three weeks remaining in the campaign, voters, donors and volunteers are coming to Governor Cuomo,” said Liz Benjamin, a spokeswoman for Fix the City. “We are ramping up our efforts to reach out to New Yorkers in every borough who know the city needs a mayor with the experience to lead and deliver. This is not the time for experimentation or learning on the job.”
Wynn had not donated to any Cuomo PACs before his latest contribution. The founder of Wynn Resorts has become a major Republican Party donor in recent years, and lent support to President Donald Trump. (Wynn stepped down from his namesake hotel-casino company in 2018 after being accused of sexual misconduct, and was not involved in its failed bid with the Related Cos. for a Hudson Yards casino this year.)
New York energy regulators gave Con Edison the green light to recover the costs of $440 million worth of “urgent” energy projects to bolster the city’s electric grid. The move aims to keep up with demand as building owners increasingly swap fossil fuel-powered equipment with greener alternatives and more car owners switch to electric.
The New York Public Service Commission approved five Con Edison projects in the Bronx — in the Hunts Point, Parkchester, Westchester Square and Mott Haven neighborhoods — that will install new cable and other power equipment and will allow the utility to recoup the projects’ costs from its electric customers through a surcharge (the exact amount of which and when customers can expect is yet to be determined).
City officials aren’t thrilled about the timing of the approvals, as Con Edison is already negotiating with the state for an increase to next year’s electric and gas bills for its customers to pay for infrastructure projects; New Yorkers could see spikes of more than 11% and 13%, respectively, if Con Edison gets its wish.
The city, in comments submitted to the state on the proposed projects, said it supports the infrastructure upgrades but opposes how Con Edison and state regulators are approaching approvals for the projects. The Adams administration says they would rather Con Edison make its case for the nearly half a billion dollars of infrastructure projects as part of an ongoing process in which the utility asked the state for permission to raise rates on its customers, so that it can pay for specific grid improvements and energy projects.
Con Edison in the spring asked the state for an increase that would allow it to collect nearly $2 billion in revenue; the state earlier this month countered with an increase that would allow the company to collect $319 million in revenue, less than half of what the company proposed.
The Commission is still reviewing the rate increase and will finalize it later this year.
The Public Service Commission, however, didn’t buy the city’s argument.
Commission Chair and CEO Rory Christian, during the vote to approve the projects, pointed to the state’s goal of transitioning from a fossil fuel-based energy system to an electricity-powered one, and said that the state must invest in “urgent grid upgrade projects” if it wants to support the companies helping the state realize that future. The PSC said it routinely assesses necessary investments to meet demand.
“We’re at a point now where we need to make some very big steps to ensure that we can be supportive of economic growth in New York state, and I see this order as key to that,” said Christian. “We're not taking steps to subject ourselves to near-term risks in the future, we're looking to address long-term opportunities, and by doing that, we limit the costs.”
An indoor trampoline park is set to land in Brooklyn this summer after inking a long-term lease with Turnbridge Equities, the real estate firm announced Thursday.
Sky Zone, a national chain of active entertainment parks, will set up shop at 2350 E. 69th St. in Bergen Beach. The Brooklyn location will likely be the first in the five boroughs for the Utah-headquartered franchise. One each is slated to open in the Bronx and Queens sometime in 2026.
It's unclear exactly when during the summer the indoor trampoline park will arrive and exactly how long the lease's length is, but Sky Zone is taking all 52,100 square feet of space in the industrial building between Avenues W and X in the southern Brooklyn enclave, said Ryan Nelson, managing principal of Turnbridge Equities, the Manhattan-based landlord of the building.
Founded in 2015 and based in Brant Park, Turnbridge Equities acquired the 1-story warehouse last year for $8.9 million, according to city records. The property, which sits on almost 1.4 acres of land on the edge of the East Mill Basin waterway, is one of eight industrial assets owned by Turnbridge across the New York metropolitan area, said Nelson.
Built in 1978, the space is currently occupied by Match Point NYC, a large gym facility offering swimming, tennis and other sports and activities; its lease, however, is expiring, said Nelson.
Nelson declined to say how much Match Point NYC is paying for its lease or how much Sky Zone will be, but the estimated rent at the property is between $21 and $25 per square foot, according to information from CoStar.
Josh Gosin and Jordan Gosin of Newmark Knight Frank represented Sky Zone in the transaction, while Turnbridge represented itself in-house.
Founded in Las Vegas in 2004 by Rick Platt, Sky Zone is in the portfolio of Palladium Equity Partners and considered the world's largest franchiser and operator of indoor trampoline parks. Now led by CEO David Hoffmann, who took the helm earlier this year after stints at Mammoth Holdings as CEO and at Dunkin' U.S. as president, Sky Zone has 200 entertainment parks across the country. It took home $426 million in sales in 2022, according to industry outlet Franchise Times.
New York City’s unemployment rate stood at 5.1% in March 2025, significantly higher than the statewide average and pre-pandemic levels. Workers across the five boroughs, particularly Black, Latino, immigrant New Yorkers, and young adults aged 18–24, who face a 13.6% unemployment rate, are being left behind.
At the same time, billions in public and private investments are fueling major economic developments in life sciences, food distribution, infrastructure, and housing. These projects promise to reshape industries and create tens of thousands of jobs. However, without decisive action, many New Yorkers risk being excluded from this economic resurgence.
If we don’t embed workforce equity into major capital projects from their onset, we risk repeating the mistakes of the past. Every investment must create sustainable opportunities for New Yorkers. The five key priorities in the New York City Council’s Response to the Fiscal 2026 Preliminary Budget point the way forward, reflecting the critical nexus of workforce development and economic recovery, an intersection we must embrace for a just and inclusive rebound.
Housing as workforce policy
Addressing the housing crisis requires a robust workforce to build and maintain affordable homes. A 2021 report by planning firm AKRF indicated NYC needs 560,000 more housing units by 2030, with 227,000 units immediately required to compensate for past underproduction. While the Council has secured billions in housing capital, progress is delayed by staffing shortages and bureaucratic bottlenecks.
The Council has called for increased investment in municipal hiring and workforce pipelines tied to construction, building trades, and property management. Specifically, the Council's FY26 Preliminary Budget Response recommends a $2.2 million investment to enhance HPD's litigation team, which is instrumental in holding negligent landlords accountable and ensuring safe housing conditions.
Education as economic infrastructure
Workforce development begins in the classroom. Investments in early childhood education support both the sector’s workforce and working parents. The Council has called for the restoration of $197 million in funding for 3-K and Pre-K programming for FY26 to continue providing robust early childhood education programs.
Additionally, CUNY remains our city’s most powerful engine of economic mobility, with over 80% of graduates staying locally post-graduation. The Council emphasizes the importance of expanding on-ramps to CUNY to strengthen the link between academic credentials and employment in growing industries.
A healthier, safer city requires a care-focused workforce
Nearly half of economically disadvantaged New Yorkers with high healthcare needs have reported delaying or forgoing physical health care due to systemic barriers, directly impacting their employment stability. The Council's budget response includes a $10 million investment in FY26 for the "Groceries to Go" program, aiming to address food insecurity, a critical component of overall health. Investing in care infrastructure addresses urgent community needs, creating opportunities for workers to advance into higher-wage roles in social services, ambulatory care, and behavioral health.
Simultaneously, New York’s health sector is poised for significant growth, with projections indicating over 22% expansion by 2030, adding more than 300,000 jobs. Behavioral health alone is expected to grow by over 25%.
The workers powering libraries, parks and culture
Parks, libraries, and cultural institutions are job hubs and engines of neighborhood vitality. NYC’s cultural sector contributes over $110 billion to the local economy, supports 300,000 jobs, and generates $30 billion in wages.
The Council's budget response calls for restoring $41 million in funding for arts programming and $14 million for Community Schools in FY26.
City services are the front line of job creation
Nearly 20,000 vacant city jobs represent missed opportunities for economic mobility, especially in civil service roles that offer stability and middle-class wages. Nonprofits contracted to do the City’s work are also struggling under the weight of unpaid contracts and workforce burnout. If we want our City to function and grow equitably, we must fund the people who power it.
The bottom line
Workforce development is the foundation of an inclusive economy. That means training and connecting workers to the opportunities these investments create. If we get this budget right, we’ll ensure that this growth reaches the working families, young people, and communities too often left behind. Workforce equity is smart policy, and the only path to a thriving City that works for all of us.
Gregory J. Morris is the CEO of the New York City Employment and Training Coalition. Amanda Farías is the Majority Leader of the New York City Council and represents District 18 in the Bronx.
The super PAC supporting Andrew Cuomo is raising and spending unprecedented sums of money in the final days of the mayoral primary race, a sign that the ex-governor’s supporters in the business world take seriously the threat posed by his top rival, Zohran Mamdani.
A new $3.3 million donation by billionaire former mayor Michael Bloomberg, disclosed on Wednesday, brought Fix the City’s total haul to $24 million over three months, more than triple the total raised by any previous outside PAC in a city race. Bloomberg has now donated $8.3 million to the pro-Cuomo PAC, coincidentally matching the amount that any individual candidate can legally spend in a primary race.
After initially using its war chest to boost Cuomo, the PAC has increasingly invested in tearing down Mamdani. The socialist assemblyman trailed Cuomo by 10 points in the final ranked-choice round, according to a Marist College poll released this week, although 11% of voters remained undecided when that survey was conducted in mid-June. Mamdani has gained significantly on Cuomo in recent weeks, and the Marist poll showed Mamdani leading with Latino voters for the first time.
Fix the City has reported spending $1 million on mailers just since Sunday, including $83,000 to send out pamphlets touting Cuomo’s endorsements by Bloomberg, Queens Congressman Gregory Meeks, and state Sen. and mayoral candidate Jessica Ramos. The latest disclosures also show Fix the City plans to deploy paid outreach workers to counter Mamdani’s vaunted army of 46,000 volunteers — the Cuomo PAC has paid $344,900 to two political firms for “field operations” since last week, and commissioned T-shirts reading “Vote for Cuomo: the mayor for this moment.”
Early voting began June 14 for the June 24 Democratic primary. In another trend that may be worrying Cuomo’s supporters, early data has shown a surge in voting in the neighborhoods friendlier to Mamdani, and among young voters who tend to support him, Gothamist reported. Temperatures are also forecast to reach over 100 degrees on Primary Day, potentially hampering turnout among the older voters who make up Cuomo’s base.
The latest donors to the pro-Cuomo PAC also include Palantir Technologies CEO Alex Karp (who gave $90,000), billionaire cosmetics heir William P. Lauder ($250,000), and Gershon Barnett, whose name matches the full name of Extell Development CEO Gary Barnett ($250,000).
Mamdani, whose allies have little ability to counter the spending, called a press conference on Thursday to criticize the cash infusion as “offensive to the very fabric of our democracy.”
The Working Families Party, which supports Mamdani as its top choice for mayor, reported spending $400,000 this week on new television ads criticizing Cuomo. The sum is paltry compared to the $9.5 million spent by Fix the City and the landlord group New York Apartment Association on pro-Cuomo ads, and the $6.4 million spent on anti-Mamdani spots.
Cuomo’s aides remain publicly bullish about the front-runner’s chances, constantly denigrating Mamdani and other rivals such as Brad Lander on social media. Thursday morning, longtime Cuomo aide Melissa DeRosa posted on X trumpeting Thursday’s front page of the free newspaper AMNY, whose opinion section endorsed Cuomo for mayor.
DeRosa did not mention that the front page, which calls Cuomo “the mayor for the moment,” is actually an advertisement paid for by Fix the City.
An industrial property in Long Island City has traded hands for the first time in more than 50 years.
Terreno Realty Corp., a real estate firm based in San Francisco, has purchased 11-40 Borden Ave. for $16 million, brokerage Adirondack Capital Partners announced Thursday. The company bought the property from longtime owner Wickersham Realty.
Adirondack's Chad Sinsheimer was the broker for the buyer and the seller in the deal, which he said "reflects the enduring strength of Long Island City's industrial market." A representative for Terreno declined to comment on the company's plans for the building, although Sinsheimer said the firm intends to keep it as is. A representative for Wickersham declined to comment as well.
The 36,000-square-foot property is located near the Midtown Tunnel and the Newtown Creek waterfront. It was built in 1960, stands 2 stories tall and has construction distribution company Distribution International as its sole tenant. The lease encompasses the entire building and lasts through May 2028, according to a press release from Terreno.
The site includes more than 4,000 square feet of parking as well. The estimated asking rent is $23 to $28 per square foot, according to commercial real estate database CoStar.
The property is just the latest industrial acquisition in the city for Terreno. The company recently bought 21 parcels near John F. Kennedy International Airport from Blackstone, part of a blockbuster deal that included industrial properties in New Jersey, Los Angeles and the San Francisco Bay area that Terreno bought for a total of about $365 million. Terreno also purchased a warehouse at 181 Lombardy St. in Bushwick last year for $12 million and a warehouse at 185 Van Dyke St. in Red Hook in 2023 for $27.5 million.
Last year was the busiest year since 2020 for leasing at industrial properties in the outer boroughs, with firms leasing more than 2.8 million square feet of space, according to data from JLL. During the first quarter of this year, firms leased about 600,000 square feet of space, which was in line with activity over the past two years, while the vacancy rate of 4.8% remained one of the tightest in the nation, according to the brokerage.
The curtain may have come down for good on Life & Trust, the elaborate Sleep No More-inspired interactive play in FiDi that suddenly closed in April after just nine months.
But The Demot Co., the owner of 20 Exchange Place, where the show was staged, claims the play’s producers still owe millions in rent.
Dermot on Tuesday sued Jonathan Hochwald and Arthur Karpati of Emursive Productions for more than $4 million, including $3.1 million for allegedly unpaid rent for the play’s performance space, an 85,000-square-foot berth at the full-block former bank.
According to the filing in Manhattan state Supreme Court, Hochwald and Karpati also allegedly owe $1 million for a supposedly unpaid security deposit and have also allegedly failed to keep up appearances at the landmarked building by not “maintaining” doors, windows and façade metalwork.
The producers, who shut down stock-market-crash-themed Life & Trust, which had received weak reviews, after the April 19 performance, have not yet filed an answer to the complaint. And a phone message left at Emursive’s box office was not returned by press time.
But the partners, who previously produced the Macbeth-based Sleep No More from 2011 to 2024, tangled in court for months with their landlord at that play’s West Chelsea site, Centaur Properties, over allegations of unpaid rent and fees to the tune of $4.5 million. A judge last month ruled in favor of Centaur.
At 20 Exchange, a 57-story, mixed-use, prewar conversion with 767 apartments that Dermot bought last summer for $370 million in a blockbuster deal, Emursive was paying $150,000 a month for a seven-level space through a lease originally inked in 2018.
The closing of Life & Trust, which reportedly cost millions to produce and required years of planning before its August 2024 debut, also prompted the layoffs of 116 people, 108 of whom were directly employed by the play, according to a state unemployment notice made public earlier this month.
Joshua Kopelowitz, the attorney with Fox Rothschild handling the lawsuit for Dermot, did not return a call for comment by press time. And an email sent to Dermot was also not immediately returned.
Cornell University warned of job cuts and “financial austerity in all areas” as it steps up efforts to address budget shortfalls stemming from U.S. funding cuts under President Donald Trump.
Short-term measures are no longer enough to plug the gaps left by the loss of hundreds of millions of dollars in federal research contracts, Cornell President Michael Kotlikoff and other school leaders wrote in a message Wednesday. The Ivy League university now needs to shrink its workforce and cut other costs to bring about “permanent change to our operational model,” they said.
“It is important that every member of this community understands both the scale of the challenges our university faces, and the seriousness of the risks,” they said. “Cornell’s funding model, developed over 160 years, is strong and diversified, and has carried us successfully through many past crises. We are now experiencing simultaneous attacks or threats on every element of that model.”
Trump has ramped up financial pressure on universities, pushing to raise a tax on endowments and canceling research deals while hammering schools for their handling of antisemitism on campus following the Oct. 7, 2023, attack by Hamas on Israel and the Jewish state’s retaliatory response in Gaza. Other schools including Harvard University and the Massachusetts Institute of Technology have also cut costs in response to the pressure.
Cornell, which had some federal grants frozen earlier this year, said it was contending with “rapidly escalating” legal costs and increased personnel expenses. Headcount has increased by more than 15% in the past four years, significantly outpacing the university’s revenue growth, it said.
The need for personnel will be reviewed across every part of the Ithaca-based school, they said. The university expects to make involuntary staff cuts, not just control costs through attrition.
Cornell will also keep in place hiring restrictions and limits on travel and other discretionary expenses. Looking ahead, the school leaders cited the threats posed by the loss of future federal funding and financial aid and the proposed endowment-tax hike in the budget “One Big, Beautiful Bill” now pending in the US Senate.
Leases
Shopping center landlord takes space in Midtown
Address: 825 Third Ave., Manhattan
Landlord: The Durst Org.
Tenant: Macerich
Lease size: 12,000 square feet
Asset type: Office
Brokers: Tom Bow, Ashlea Aaron, Bailey Caliban and Sayo Kamara represented the landlord in-house. Bradford Allen’s Gordon Ogden and James Hart represented the tenant.
Sales
National firm acquires Long Island City warehouse in all-cash deal
Address: 11-40 Borden Ave., Queens
Seller: Wickersham Realty
Buyer: Terreno Realty Corp.
Sale price: $16 million
Asset type: Industrial
Broker: Adirondack Capital Partners’ Chad Sinsheimer represented the seller and the buyer.
Financings
New resi building planned for LIC scores construction loan
Addresses: 42-55 and 42-53 27th St. and 42-74 and 42-76 Hunter St., Queens
Owners: Montperia Group and JLS Construction
Lender: Cathay Bank
Loan amount: $15.1 million
Asset type: Development site
Northwell eked out a positive margin in Q1 as rapidly rising costs corroded big wins in patient revenue.
The hospital saw total patient revenue increase by 7.3% compared to Q1 of 2024, but an 8.2% uptick in wages, along with a 6.8% surge in supply costs, ate away at the gain. The hospital system’s margin netted out at .65%, according to figures in an unaudited financial statement.
The report painted a picture of a generally healthy hospital system, according to Dr. Ge Bai, a professor of accounting and health policy at Johns Hopkins University in Baltimore, who reviewed Northwell’s financial statement. But rising costs “cratered” their margin, she said.
The system’s physician practice, which stands at nearly 9,000 doctors, emerged as a particularly bright spot in the report. Though that part of Northwell’s business comprises just a fifth of operating income, it grew at an 11% rate from last year. Net patient services, which make up for the lion’s share of operating revenue, grew by about 6%.
Along with an increase in prices for labor, Northwell invested about $379 million in capital expenditures on things like IT and physical infrastructure, according to the filing. That marks a nearly 14% increase from the same period last year. Covid relief, which is still trickling into hospitals, also fell sharply compared to Q1 of 2024. The funds declined to $48.8 million in the first quarter this year, a 66% dropoff from the $142.3 million received in the same quarter last year.
The report, which captures January through March of this year, does not yet reflect Northwell’s merger with Nuvance Health on May 1, a move that added seven hospitals to its sprawling network.
Northwell’s total revenue was more than $18.6 billion in 2024. It has 21 hospitals and more than 900 ambulatory clinics and physician practices. The system employs approximately 90,000 people.
On a recent afternoon on Manhattan’s Upper East Side, young patrons queued up for a TikTok-famous treat: a $5 cookie from Crumbl.
Just outside, Merle Behrens, 17, was posing for a photo with the chain’s signature pink box in hand. She purchased four of the brand’s giant — and very sweet — cookies: Chocolate cake, chocolate chip, cookie dough and blueberry cheesecake.
“Once you see it on social media, and also when you tell your friends or your family that you’re going to the States, everyone says, ‘Oh, you should get Crumbl cookies,’” said Behrens, who was visiting New York from Germany.
Crumbl has built its viral desserts into a big business, with franchisees operating over 1,100 stores in the U.S., Puerto Rico and Canada. Estimated sales of its brightly-colored, oversized treats more than tripled from $396 million in 2021 to over $1.2 billion in 2024, according to food consultant Technomic. And as customers pull back on big-ticket items like cars or vacations, they’re likely to seek daily luxuries that are more affordable, said Aaron Allen, a restaurant consultant whose firm has worked with chains including Starbucks and The Cheesecake Factory.
“This is like, ‘I’ve busted my butt and I deserve a treat, I deserve a cookie,’” Allen said.
Now, Wall Street is getting in. In May, private equity firm TSG Consumer Partners agreed to take a minority stake in Crumbl in exchange for preferred equity, while Blackstone Inc. and Golub Capital have closed a $500 million private credit loan to the company, according to a person with knowledge of the matter.
Crumbl confirmed that it sold a minority equity stake to TSG Consumer in a statement to Bloomberg News. “We are proud of what we’ve built and are excited about this new partnership with TSG, which will help support our continued growth and long-term vision,” a company spokesperson said.
TSG Consumer and Blackstone declined to comment. Golub Capital did not respond to a request for comment.
The interest in Crumbl is just the latest example in a string of deals looking to capitalize on America’s sweet treat economy. Last week, Krispy Kreme announced it had sold off its remaining stake in Insomnia Cookies to two private equity firms – after selling a majority stake last summer at a $350 million valuation. That came on the heels of New York’s Chip City Cookies bringing in a second round of investment from Enlightened Hospitality Investments, a fund led by Shake Shack founder Danny Meyer.
Crumbl’s business is a franchise model, where the company takes 8% of gross sales at locations, in addition to fees for training and marketing.
Each week, the brand unveils a fresh batch of treats to its over 16 million followers on TikTok and Instagram, complete with cinematic footage of the desserts on offer. Its emphasis on scarcity works to drive customers into the white-walled, open-concept bakeries week after week. “This is your last chance to get this week’s lineup,” an employee warns in one clip, highlighting her picks: a Banana Cream Pie cookie and a “classic semi-sweet.”
An ecosystem of fan-made content exists in parallel.
On TikTok, customers post unboxings, showing off each item to the camera before biting in. On Reddit, devotees campaign for their favorite flavors like “Mallow Sandwich Cookie” or “Caramel Toffee Butter Cake” to garner votes at their local stores. (Rewards members who spend over $50 annually can vote on Crumbl’s app for items to be added to their local franchise as a one-day special.)
These contests have spurred an unofficial barter system on social media in which fans trade votes across locations to boost their preferred flavor. One fan active on the r/CrumblCookies Reddit forum this month pleaded:
"please please please can you guys vote for nilla bean cupcake or chocolate covered strawberry at West Brighton location? the first place is s’mores cookie BUT WE’RE GETTING THAT NEXT WEEK!!! i have 4 votes left,"
to which another replied, “If you can vote for double fudge brownie in Dalton, Ga I’ll vote for yours!”
By putting out fresh flavors so regularly, Crumbl has given itself a leg up, said Clifford Hudson, former CEO of Sonic Corp. and the founder and director of DIA Equity Partners. “It’s a more extreme position than what we used to think of as new product news,” he said. "They’re taking it to a different level.”
Last year, Bristol Myers Squibb devoted half a page of its annual report to its diversity, equity and inclusion efforts, going so far as to list the company’s internal groups for Black, Latino and LGBTQ employees. This year, the word “diversity” only appears under risk factors.
Bristol’s 2024 report, issued Wednesday, deleted a paragraph spelling out its goals to diversify clinical trials and invest in minority-owned businesses. The company, based in Lawrenceville, New Jersey, also excised a reference to its “longstanding commitment to elevate inclusion, diversity and health equity.”
Large companies are increasingly facing lawsuits and activist pressure to scale back or cancel their DEI initiatives. President Donald Trump has signed executive orders meant to dismantle DEI efforts within the government and among federal contractors. Meta Platforms, Amazon.com and McDonald’s have retreated from their DEI policies, while Goldman Sachs Group Inc. has scrapped an earlier pledge that it wouldn’t underwrite initial public offerings for companies that had all white, male boards.
The trend is hitting the pharmaceutical industry, where companies once trumpeted their equality goals. Covid-19 vaccine developers that were funded by Trump’s first administration pledged to recruit ethnically diverse populations for clinical trials. New Brunswick, New Jersey-based company Johnson & Johnson committed $100 million to “take on the inequities rooted in systemic racism that threaten health in communities of color across the United States,” and Pfizer, headquartered in Hudson Yards, published a review of its own historic clinical trial diversity, declaring “it’s time to do better.”
When asked about the changes in its annual filing, a Bristol spokesperson said the company routinely updates them and is “evaluating recently-announced policies,” without specifying whether it has rolled back its diversity goals or made internal changes. Trump signed the executive order on the DEI practices of federal contractors in late January.
Other drugmakers
“Inclusion and belonging are core to how we do business,” at Bristol, the spokesperson said, adding that “decisions on hiring and performance are merit based.” The company’s employee resource groups remain in place and Bristol is an “equal opportunity employer,” according to the spokesperson.
Other drugmakers have trimmed references to DEI in their filings. J&J replaced “DEI” with “inclusion and belonging” in its annual report, released Thursday. The company also deleted a paragraph on employee training that included a mission statement to “make diversity, equity and inclusion how we work every day.”
J&J said in a statement that the company “has always been and will continue to be compliant with all applicable legal requirements and remains dedicated to the values in our credo.”
Biogen Inc. removed the phrase “diversity, equity and inclusion” from its annual report filed Wednesday, instead describing the company as having a “culture of inclusion” and a commitment to “merit-based opportunities.” The latest filing didn’t include the word “diversity.”
“We believe talking about a culture of inclusion better describes Biogen’s strong belief in an inclusive workplace that fosters innovation and helps us to better support patients,” a spokesman said in a statement.
In its annual report last year, the biotech company Alnylam Pharmaceuticals said it was focused on extending “diversity, equity and inclusion initiatives” across its workforce. This year’s filing said the company values “our talented and diverse workforce,” but removed the mentions of “diversity, equity and inclusion” and a reference to supporting underrepresented groups such as women, members of the LGBTQ community and people of color. Alnylam Chief Executive Officer Yvonne Greenstreet is among the few women of color in high-ranking corporate positions across the drug industry.
Alnylam representatives didn’t immediately respond to a request for comment.
Bristol and Biogen’s corporate diversity web pages are still online, touting each firm’s commitments to inclusion. But other companies are removing this language from their public-facing communications. Genentech, the U.S. division of Roche Holding AG, removed diversity and inclusion targets from its website, saying the company is taking time to understand any potential implications of executive orders and other actions by the Trump administration.
Drugmakers are reliant on government health programs, including Medicare and Medicaid, for substantial portions of their revenue. Bristol’s biggest drugs, the cancer treatment Opdivo and blood-thinner Eliquis, get significant revenue from sales to Medicare, according to an analysis from Leerink Partners.
Mayor Eric Adams’ administration plans to sue the federal government over the Trump administration’s seizure of $80 million from a city bank account earlier this week, according to a letter obtained by Crain’s.
The city’s Law Department “is currently drafting litigation papers” and intends to file a lawsuit by Feb. 21, wrote Muriel Goode-Trufant, corporation counsel for the Adams administration, in a letter sent Friday to Comptroller Brad Lander. The letter did not specify which federal agency it would name in the suit.
The disclosure came hours after Lander, the city’s fiscal officer, wrote to the Adams administration to demand that they either initiate a lawsuit or give him permission to hire his own attorneys and bring the case. The Adams administration’s willingness to sue is notable, given the mayor’s increasingly close relationship to President Donald Trump’s administration — especially on immigration enforcement.
The $80.5 million had been awarded by the Federal Emergency Management Agency during President Joe Biden’s term in office under a 2023 program that reimburses localities for immigration-related expenses. The money was sent to the city only last week, and the billionaire Elon Musk — whom Trump has authorized to aggressively slash government services — wrote falsely on X on Monday that the funding had been intended for disaster relief.
The following day, the federal government apparently seized the money from a Citibank account kept by New York City, according to Lander’s office, which discovered the missing funds Wednesday morning. Lander said he was unaware of any prior instance of the federal government revoking money from the city’s coffers, and called the move “highway robbery.”
FEMA did not immediately respond to a request for comment Friday afternoon.
Adams said Wednesday that he had requested an “emergency meeting with FEMA” to resolve the issue and that he planned to discuss the money with border czar Tom Homan during a meeting that eventually took place Thursday. He also said the city was “exploring various litigation options.”
Musk inaccurately claimed earlier this week that the money sent by FEMA was being used to shelter migrants in luxury hotels.
Kristi Noem, the Homeland Security secretary, wrote on X that she had “clawed back the full payment that FEMA deep state activists unilaterally gave to NYC migrant hotels.”
A hedge fund manager has made a major bet on a Tribeca penthouse that has grappled with a long list of construction problems, at least in the eyes of its former owner.
Daniel Gold, the chief executive officer of QVT Family Office, has plunked down $35.5 million in cash for a four-bedroom unit near the top of the Jenga Building, the high-profile condo tower on Leonard Street known for its many jutting balconies.
The deal, which went into contract Dec. 12 and closed Jan. 29, according to a deed that appeared in the city register Thursday, appears to be one of the largest single-unit apartment transactions in New York this year, excluding new development projects.
But what might be the more remarkable aspect of the sale of the 5,900-square-foot unit, which features four and a half baths, floor-to-ceiling windows and two balconies, is how much detailed information exists about its supposed shortcomings.
Indeed, its seller, Ron Dana, a truck driver turned trucking company mogul, for years battled the tower’s developers, Alexico Group and Hines, as well as its Corcoran Group marketers, over what Dana alleged was shoddy construction and damage that he encountered after he acquired the unit for $29.1 million in 2017.
Cracked floors, missing curtains and even the lack of a kitchen sink stopper were among the three pages of supposed problems Dana listed in a lawsuit he filed against the condo’s sponsors and brokers in 2018. The suit also accused the development team of misrepresenting the finished product.
The team, which denied it acted fraudulently at a tower that wasn’t even built in 2013, when Dana signed his contract, tried to get the case dismissed. But in 2019 Manhattan state Supreme Court Justice Robert Kalish offered a mixed decision, dismissing some of the fraud charges but allowing others about defects to go forward.
Seven years later, both sides are still locked in mediation and trying to hammer out a settlement, filings show.
Meanwhile, it’s not clear if anything was done along the way to address Dana’s complaints. Very few listing photos exist, and none zero in on the kitchen, for example.
The sale, which took place after a nonpublic “whisper” marketing campaign, seems to have no bearing on the ongoing suit. But Bruce Lederman, Dana’s lawyer, had no comment.
Dana does not appear to have ever lived in the apartment, which was shopped around with empty rooms. In fact, court filings suggest he always intended to treat the penthouse as an investment and rent it out.
Founded by Dana in 1970, Avenel, New Jersey-based Dana Cos. leases oil trucks, tanks and rail cars across the country and also owns a related firm, Avenel Truck & Equipment. Jordan Dana, a vice president of the sister company, signed the deed in the penthouse transaction. A phone message left for him at his office was not returned by press time.
For its part, QVT, which Gold, an ex-Deutsche Bank trader, founded in 2003, invests in rare-earth mines used for cellphone production, oil companies and shipping businesses, according to online profiles and news reports.
The Westchester address listed for the buyer appears to be that of Gold’s current home. But for his purchase, Gold shielded his identity behind a shell company, Architeuthis Dux LLC, as in the Latin name of the giant squid, a massive and almost mythical creature.
Whether the company’s moniker is a reference to the penthouse’s dimensions or the deal’s size—the real estate world’s equivalent of a blockbuster tech “unicorn” investment, perhaps—is unclear. A message left for Gold at his Midtown office was not returned.
And Nick Gavin, the Compass agent who marketed the penthouse, declined to comment.
New York City's new program for outdoor dining sheds is off to a slow start.
Only 40 permits have been issued so far by the city Department of Transportation to roughly 1,400 restaurants that want to make their pandemic-era roadway seating permanent.
Under the rules that went into effect last year, roadway dining structures have to be taken down and stored during the winter and redesigned to new specifications, such as not being fully enclosed. In addition, restaurants must reapply for an operating permit for the outdoor dining season, which starts April 1.
Eateries have complained about the stricter rules, and only about half of the restaurants using roadway and cafe dining permits last year applied to keep them -- just over 3,000 establishments.
There's a permitting backlog that will leave applicants with little time to get approval and make modifications, like designing new outdoor seating or obtaining liquor licenses, city Comptroller Brad Lander said in a statement.
"City Hall's kitchen is backed up with permits, leaving lots of restaurants out in the cold," said Lander, who is challenging Mayor Eric Adams in the Democratic primary this year.
The city said that it has already reviewed all of the applications and expects two-thirds of the roadway setups to get permits by April 1. Sidewalk cafe permits, which were requested by about 2,300 restaurants, aren't subject to the shed rules.
The DOT said the City Council put into place various requirements needed for approval, including reviews by community boards and public hearings. The City Council countered that the program is more streamlined than pre-pandemic rules for outdoor seating, and said it will conduct oversight of the DOT's implementation of the program.
An East Village house of worship is slated to become housing, records show.
The now-shuttered Emmanuel Spanish Baptist Church at 256 E. Fourth St. is poised to be converted into residential, according to permits submitted to the Department of Buildings this week.
Records show that a Williamsburg-based limited liability company filed plans to convert what's now a vacant 4-story church between Avenues B and C into six apartments, requiring the addition of two floors atop the existing structure. Rotem Cohen, who is listed as the signatory for the redevelopment, told Crain's Friday that the units will be luxury condos.
The former church had been owned by the church itself but was sold last year, records show, to Bushwick-based developer Ariel Sholomov, who appears to maintain a handful of condo buildings in Brooklyn. He acquired the property for $2.9 million in November through an entity named after the address. Meital Rosso, an attorney at Queens-based firm Rosso Law, represented Sholomov in the transaction but did not return a request for comment by press time.
Cohen, who told Crain's that he works for Sholomov at the real estate firm Ariel Development, said construction is expected to be done by summer 2026. Sholomov has previously submitted at least four plans in his name with the state attorney general to offer condos across buildings in Brooklyn, including at 1015A President St. in Crown Heights and 151 Quincy St. in Bedford-Stuyvesant, records show.
Before becoming Emmanuel Spanish Baptist Church, or Iglesia Bautista Emmanuel, in the early 1970s, the East Fourth Street house of worship was a synagogue known as Lemberger Shul, according to the local blog EV Grieve, which first reported on the conversion plans.
Leases
Recycling firm takes space in Bushwick
Address: 1345 Halsey St., Brooklyn
Landlord: ZG Capital Partners
Tenant: Next Level Redemption Center
Lease size: 5,000 square feet
Lease length: Five years
Asset type: Industrial
Brokers: Knickerbocker Realty Group’s Vincent Lopez and Jacques Wadler represented the landlord and the tenant.
Sales
West Village investor sells 20-unit rental at a loss
Address: 194 West 10th St., Manhattan
Seller: Christian Harker
Buyer: Rialto Management
Sale price: $12.3 million
Asset type: Multifamily
Financings
Chelsea rental buildings score refinancing deals
Address: 146, 148 and 150 10th Ave., Manhattan
Owner: Benchmark Real Estate
Lender: Cathay Bank
Loan amount: $15 million
Asset type: Multifamily
News updates
The Hotel Bossert, a historic 14-story Brooklyn Heights property that the Chetrit family owned and attempted to redevelop for years, sold Thursday in a court-ordered foreclosure auction to the lender holding its mortgage, hedge fund Beach Point Capital. The Chetrits were facing a $177.2 million judgment at the 284-room tower at 98 Montague St. because of mortgage defaults. Beach Point essentially took the title to the building in exchange for money owed.
Victor Sigoura’s Legion Investment Group has filed plans for its Greenwich Village site at 5 W. 13th St. The developer intends to build a 30-story, 537-foot-tall project with 36 residential units, ground-floor retail and a seven-car parking garage. The development will span about 112,000 square feet overall.
In the four months since Mayor Eric Adams was indicted on corruption charges, a strange sense of quasi-stability had settled over City Hall: the mayor had staved off early calls for his resignation, passed a major housing plan, and, at the behest of Gov. Kathy Hochul, purged his administration of officials who were swept up in law enforcement raids.
That feeling collapsed this week after President Donald Trump’s Justice Department moved to dismiss Adams’ charges, based on the explicitly transactional theory that the mayor would be freer to cooperate on federal immigration enforcement. A widespread sense that Adams is now beholden to Trump has only deepened: outgoing Manhattan U.S. Attorney Danielle Sassoon asserted in a letter that the mayor’s attorneys had offered his cooperation in exchange for dropped charges; and the mayor quickly promised to allow Immigration and Customs Enforcement agents into the Rikers Island jail after a Thursday meeting with Trump’s border czar Tom Homan.
“If he doesn’t come through … I’ll be in his office, up his butt, saying, ‘Where the hell is the agreement we came to?’” Homan said during a Friday morning appearance on Fox News’ “Fox & Friends” program, sitting alongside the mayor. Adams also sat uncomfortably as Homan called for Hochul to be “removed” based on her support for sanctuary laws that limit cooperation with ICE.
Meanwhile, calls for Adams’ resignation grew on Thursday and Friday, including from state Senate Deputy Leader Michael Gianaris and Lt. Gov. Antonio Delgado, who called Adams “beholden to the president.” Delgado’s boss, Hochul, notably softened her prior refusal to use her power to remove Adams — telling MSNBC’s Rachel Maddow on Thursday that she found Sassoon’s letter “extremely concerning.”
“I have to do what's smart, what's right, and I'm consulting with other leaders in government at this time,” Hochul said. “I need some time to process this and figure out the right approach.”
Hochul has been viewed as unlikely to use her removal powers, in part given the fraught politics of removing the city’s second Black mayor when Black voters will be instrumental to her re-election campaign next year. But the mayor’s support among Black leaders is slipping, too: the Rev. Al Sharpton said this week that he feared Adams had become a “hostage” and would meet with fellow clergy and elected officials to “decide where we will go.”
Seeking to limit the damage, Adams issued a statement Friday afternoon denying Sassoon’s claim that his attorneys had offered up his help on immigration as part of a quid pro quo.
“I want to be crystal clear with New Yorkers: I never offered — nor did anyone offer on my behalf — any trade of my authority as your mayor for an end to my case. Never,” Adams said. “I am solely beholden to the 8.3 million New Yorkers that I represent and I will always put this city first.”
At minimum, the mayor’s political future appears in significant doubt. Two recent polls about the Democratic mayoral primary, conducted days before Adams’ charges were ordered dropped, found him in second place — but trailing former Gov. Andrew Cuomo by double digits. It’s unclear how dropping the charges could change that picture, but Adams’ increasing closeness to the Trump administration will do him no favors among Democratic primary voters.
And despite reports that Adams is exploring running as a Republican in either the primary or general election, the mayor has insisted he will run as a Democrat. His chances of prevailing in a Republican primary may be no better than a Democratic contest — Adams’ approval rating among Republican voters was just 28%, according to an early February poll — although the potential involvement of Trump as an ally could scramble those numbers.
Adams’ mayoral rivals had harsh words for his TV appearance with Homan. Former comptroller Scott Stringer labeled it a “hostage situation”; state Sen. Jessica Ramos called the situation “humiliating for us all,” and current comptroller Brad Lander summarized the interview as “sad, embarrassing, and enraging.”
“It’s time for this mayor to go,” Lander wrote on X.
Adams himself has dodged reporters since the order from Washington to drop his charges, saying little aside from a Tuesday speech in which he incorrectly implied that he had been exonerated.
The mayor has not yet been asked to address another claim that Sassoon made in her letter: that Manhattan prosecutors had been prepared to bring a new superseding indictment that would have charged Adams with destroying evidence and instructing others to lie to the FBI, and added more evidence of Adams’ alleged participation in a scheme to solicit illegal campaign donations. (Adams’ attorney Alex Spiro responded that if prosecutors “had any proof whatsoever that the mayor destroyed evidence, they would have brought those charges — as they continually threatened to do, but didn’t, over months and months.”)
In his Friday morning appearance on “Fox & Friends,” the mayor swatted away questions about whether the Trump administration would refile his charges — a possibility that the DOJ has kept open — if he does not cooperate on immigration enforcement.
“I don’t get into the legalese,” he said. “I have an attorney to do that, and I pay a lot for that.”
The mayor also downplayed the significance of his close ties to Trump officials.
“My life is sitting down with people I don’t agree with 100 percent of the time,” he said. “I don’t agree with myself 100 percent of the time.”
The Cleveland Museum of Art has agreed to transfer a statue that has been the subject of an ongoing dispute to the District Attorney of New York to deliver to the Republic of Turkey.
Scientific testing conducted in cooperation with all three parties concluded that the bronze statue, which has been part of the Cleveland museum's collection for nearly 40 years, was “likely present” at the site where Turkish officials claimed it had been illegally obtained, according to a news release.
The statue, which depicts a headless male figure, was seized by New York officials in September 2023. The following month, the museum filed a lawsuit against New York District Attorney Alvin Bragg, accusing Bragg’s office of using a “criminal process to seize” the statue and asserting that the seller "made a series of representations and warranties to CMA” that the seller was the statue’s lawful owner and had the right to sell it.
“The museum appreciates the cooperation that officials in (Turkey) and at the office of the District Attorney provided to come to a scientific resolution of the issues surrounding the statue,” the news release says. “Without this new research, the museum would not have been able to determine with confidence that the statue was once present at the site.”
Further, CMA said that museum and Turkish officials are considering a temporary display of the statue in Cleveland prior to its transfer to Turkey. Last year, the museum returned artwork to Libya and the Republic of Italy.
The “extensive testing” involved creating molds of the statue’s feet and comparing them to stone pedestals found at the Sebasteion, a historical landmark in Turkey. They performed lead isotope analyses on lead from the foot of the statue and samples from a Sebasteion pedestal and conducted three types of analysis on soil from within the statue, comparing it to soil from different areas in the ancient city of Bubon and from a statue known to have been at Sebasteion.
The results led CMA to conclude that the statue was unearthed at Bubon.
The testing also supported CMA's recent determination that the statue is likely not, as previously believed, a depiction of Roman emperor Marcus Aurelius but a statue of a Greek philosopher.
“The stone base at the Sebasteion where the statue was likely located does not bear any inscription,” the museum said. “Although there is an inscription on a separate stone base at the Sebasteion that bears as a legend an ancient Greek version of ‘Marcus Aurelius,’ the new tests suggest that the Philosopher is very unlikely to have ever been on that stone base.”
CMA purchased the statue for $1.85 million from the Edward H. Merrin Art Gallery in New York in 1986.
Mayor Eric Adams finds himself at a crucial crossroads. The Department of Justice has ordered the U.S. Attorney’s office in Manhattan to dismiss corruption charges against him, prompting a wave of prosecutor resignations and growing calls for Adams to resign or be removed from office.
If the charges ultimately are dismissed, and Adams continues to serve as mayor, he should embrace what amounts to a second chance to redefine his leadership. He should resist the temptation to assume that he has gotten away with his former way of doing business. He must set those old practices behind him and learn from these arduous months of raids, resignations and indictments.
He should become the person New York needs him to be.
Specifically, Adams must demand excellence from the people he surrounds himself with, not just loyalty. He must prioritize competence over compliance.
He must keep his hand out of the cookie jar. He was charged with five counts of soliciting campaign donations from foreign nationals, hiding the contributions through straw donors and using the allegedly fake donors to draw millions in public matching funds from the city program. Prosecutors alleged Turkish officials lavished him with overseas air travel in exchange for municipal favors. Perks and privileges always come at a price. That should be obvious now.
He should maximize high-profile alliances for the city’s gain. The mayor has a relationship now with President Donald Trump, which can cut both ways. Trump’s DOJ ordered Adams’ charges dismissed one day and then the very next day clawed back some $80.5 million in immigration-related federal funds. So while we won’t call it a good relationship, it is a relationship. Make it work for New Yorkers.
The relationship could be useful in making sure the city and region continues to benefit from federal funding for transportation, infrastructure, housing, education, public health, disaster relief and more.
In his public statement about the dismissal of charges, Adams struck a rare humble note. He acknowledged that “many New Yorkers still question my character” and “I know that I must continue to regain your trust.”
That is exactly the right sentiment. If he stays in that lane, he will have a chance to win re-election.
But Mayor Adams’ humble moment was sandwiched between his more typical layers of braggadocio: “I never asked anyone to break the law on my behalf or on behalf of my campaign,” he said. “And I absolutely never traded my power as an elected official for any personal benefit.”
Will New Yorkers buy that line? People want leadership that’s transparent, accountable and dedicated to the public good. Adams may still be able to provide that. For all of his faults, this mayor has been a friend to business and a pragmatic moderate.
But he has some persuading to do. From now until election day, he must continue to demonstrate to the city at large that he is a mayor who’s more interested in paving streets than padding pockets.
Italian restaurant chain Rosemary's has joined the trend of retailers opting to own their own real estate.
The eatery recently purchased its longtime West Village location at 18 Greenwich Ave. by West 10th Street for roughly $9.3 million, according to sources familiar with the deal. It bought the property from the Duell family, which has been a major New York real estate investor for decades but put a portfolio of nine largely retail properties in Greenwich Village and Midtown on the market about a year ago, hoping to get roughly $300 million for them in total.
A CBRE team led by Daniel Kaplan and Justin Arzi represented the Duell family in the deal. They declined to comment. Representatives for Rosemary's and the Duells did not respond to requests for comment by press time.
The Duells sold another building in their portfolio, 673 Madison Ave. by East 61st Street, to Friedland Properties in September for $36 million. However, the family has yet to part with 5 E. 57th St., which former CBRE broker Darcy Stacom described as the "crown jewel" of the collection at the time of its listing (Stacom has since left CBRE to start her own brokerage, Stacom CRE). The tower is right by Fifth Avenue and features David Yurman's flagship store on the ground floor.
Several retailers have been opting to buy their own properties recently, a trend highlighted by a pair of blockbuster deals that took place right by 5 E. 57th St. about a year ago. Kering, the parent company of Gucci, bought nearby 717 Fifth Ave. for $963 million, while Prada spent more than $800 million to acquire 720 and 724 Fifth Ave.
Smaller companies have gotten in on the action as well. Caudalie, a French skin care firm, bought the retail property at 130 Greene St. in SoHo for about $9.8 million last year, while fashion retailer ONS purchased Nolita's 201 Mulberry St. for $7.8 million.
Rosemary's has been a West Village staple since it opened in 2012 and is well known for its rooftop vegetable garden. The chain also has locations at 350 First Ave. near Stuyvesant Town and at the Durst Organization's 825 Third Ave. in Midtown East, which opened in April. The Greenwich Avenue property was built in 1920 and spans 4,320 square feet, according to commercial real estate database CoStar.
Rosemary's is owned by restaurateur Carlos Suarez, whose restaurant group, Casa Nela, also includes the West Village eatery Roey's, described on its website as "the more casual sibling of Rosemary's." He purchased musician Joe Jackson's former Hudson Square co-op last year for $3.3 million.
The Duells have been interested in selling this building portfolio for a long time to focus on non-real estate investments, Stacom previously said.
Architect David Rockwell has put his playful stamp on so many restaurants, theaters, hospitals, schools, airports, train stations and even playgrounds that it can sometimes seem as though he’s run out of sites to design.
But then again, when one is still busy creating inventive interiors four decades after launching a practice, there are bound to be chances to revisit old works.
Indeed, Rockwell now finds himself back at the W New York-Union Square, a former office building on Park Avenue South that Starwood hired him to convert into a trendy downtown hotel in the late 1990s.
This time around at the address, on behalf of a new client, Marriott, Rockwell has added mid-century glass-block walls, turned a wedding-focused ballroom into an airy and low-couch-lined lounge, and taken a staircase and given it a runner-style carpet whose stripes bend and wiggle as they hit the floor like pools of spilled paint.
“You have to accept the ebb and flow of things in the city and embrace it,” said Rockwell, 68. “But I continue to find ways to fall in love with New York and keep creating projects.”
Rockwell's firm, Rockwell Group, has ballooned from a six-person startup in 1984 to a three-office, 330-employee firm based in Union Square today. And he continues to take on the kind of cutting-edge restaurant projects for which he’s been known since about the mid-1980s, when he created a bar shaped like a giant lightning bolt for a Japanese joint called Zen Sushi in Midtown.
Indeed, recent clients include Madison Square Park hotspot Coqodaq, which serves fried chicken and Champagne in a long, dim room with lighted arches that evoke a subway tunnel. Rockwell also recently fashioned Daniel Boulud’s new La Tete D’Or steakhouse, an earth-toned dining space with tubular pendant lights that seems eager to bring back the Art Deco style.
“We hate clients who merely want something we’ve done before, the ones who know exactly what they want and just want you to put it on paper,” Rockwell said.
Eateries dovetail with Rockwell’s long love of theater—both depend on careful lighting, hidden-away service areas and plenty of room to maneuver. “All this prep and training goes into a presentation that’s supposed to come across as spontaneous,” said Rockwell, who sees a play about three times a week, about the same number of times he goes out to eat. “We sometimes like to go back to our own restaurants to see how they’re doing.”
However, a recent undertaking has more to do with what restaurants leave behind than what they serve. Last summer he and some food industry veterans launched Cork Collective, an effort to repurpose old wine-bottle stoppers—13 billion corks are produced annually across the globe—so more carbon-retaining cork trees can be preserved. One focus so far is to use the spongy material to resurface playgrounds.
Though he helped popularize several trends—including matte brass finishes and staircases as seats—Rockwell is loath to embrace fads for fads’ sake. “When you’re able to identify trends and talk about them, they’re probably over,” he said.
A case in point might be the sidewalk sheds that multiplied like mushrooms during the pandemic. For a time they served a vital purpose in a city that Covid turned into “an empty theater,” Rockwell said. “But they have run their course and need to come down.” Still, he added, the debates over them and their use of public space “got New Yorkers thinking about how design can really matter in times of change.”
Because Rockwell has so many types of buildings under his belt, a future project that’s completely new and different is hard to imagine. But there is actually one kind of site for which he’s never received a commission: a football stadium: Why, he asks, can’t someone design one that can operate all year round and host more than just games?
“If you spend time thinking about the things you’re interested in,” he said, “I believe that down the road they will eventually happen.”
More New Yorkers are hopping into yellow cabs on Manhattan’s busiest streets since the January launch of congestion pricing — a promising, albeit preliminary, indicator for the health of the city's taxi industry in light of the toll.
Yellow taxi trips during the initial week of congestion pricing (Jan. 5-12) increased by 10% within the city’s Central Business District compared to the same time last year. Yellow taxi drivers made more than 511,000 trips — nearly 50,000 more cab trips compared to the same week in 2024, according to data from the city’s Taxi and Limousine Commission.
At a Monday City Council hearing, TLC Commissioner David Do described the figures as “hopeful signs” that yellow cabbies are having an easier time navigating Manhattan’s core.
“If you can get passengers to your destination just a little bit quicker it means that you get a little bit more free time now to search for that next fare instead of waiting in traffic,” said Do.
“As we continue to monitor the data we may see that some people are choosing to take taxis rather than their personal vehicles in the Central Business District,” added Do. The overall increase in cab trips, he said, is so far strong enough for drivers to “overcome the impact” of the $0.75 congestion pricing surcharge on yellow taxis that enter Manhattan below 60th Street.
Behind passenger cars, taxis and Uber and Lyft vehicles made up the second largest share of weekday vehicles (36%) traveling into the congestion relief zone within the first two weeks of the toll’s launch, according to Metropolitan Transportation Authority data. Entries for these vehicles have peaked in the evening, and because they are tolled on a per-trip basis, they haven’t exhibited the same behavior of some passenger vehicle drivers who’ve shifted their travel times to take advantage of lower tolls.
So far Uber and Lyft trips have remained essentially flat compared to the same time last year. Uber and Lyft trips have recovered to pre-pandemic ride numbers, but the city’s yellow cab trips continue to hover around 50% of pre-pandemic levels. Before Covid-19, in 2019, yellow cabs completed between six and eight million trips per month.
But the cab industry is trending in the right direction. In recent months yellow taxis have reported 3.7 million trips each month; in October the city’s yellow cabs managed to hit 3.8 million trips — the industry’s highest since early 2020, TLC data shows. That’s good news for passengers (with more cabs generally available on the road) and drivers (with farebox revenue for yellow taxis now consistently at $3 million per day).
“So while the longer trend of taxi trips has been one of significant decline,” said Do, “there are hopeful signs in the recent trip increases.”
State health officials for the first time recognized the possibility that they may not be able to pull off a massive home care overhaul in the less than two months before the deadline.
The Health Department has started the process of transitioning 280,000 people from more than 600 middlemen who administer the $9 billion Consumer Directed Personal Assistance Program, which allows New Yorkers to hire friends and family members as home health aides, to just one company. The state has started enrolling 40,000 people in the new system and of those enrollees, 22,000 have completed their registrations, State Medicaid Director Amir Bassiri said in a budget hearing Tuesday, leaving the state to monitor new enrollment for 240,000 people by the statutory deadline of April 1.
The state has repeatedly assured home care recipients and elected officials that it is on track to complete the transition on time. But state lawmakers pressed officials during Tuesday’s hearing on whether that was feasible, raising concerns about the likelihood that the state can ramp up the current pace of enrollment.
“We’re monitoring it very, very closely,” Bassiri said. “There is the potential that we don’t meet the steep curve.”
Bassiri said that should the transition timeline fall behind, the Health Department’s alternative plan will depend on how far along the process gets. “The minute we don’t meet benchmarks, people will know,” he said, adding that the state has confidence that there will be no disruption for members and workers.
The comments deviate from repeated assurances from Health Commissioner James McDonald that the transition is “ahead of schedule.” Both McDonald and Bassiri have maintained that the transition will not change eligibility requirements and they do not expect that people will lose access to care.
Bronx state Sen. Gustavo Rivera, who chairs the health committee, said that the state would have to transition 5,000 people per day to meet its deadline. “April 1 does not work,” he said.
CORRECTION: This story has been updated to include research on how many minors receive gender-affirming surgeries in the U.S.
HEART HEALTH: Elmhurst Hospital has launched a Women’s Heart Health Institute to conduct research and offer specialized treatment to female patients with cardiovascular disease, the leading cause of death for women, the hospital said Tuesday. The institute will offer advanced imaging and lab testing, lifestyle counseling and heart health risk assessments for women during and after pregnancy. Elmhurst’s cardiology department treats 7,000 patients a year, 30% of which are women, the hospital said.
FAR ROCKAWAY CLINIC: A new primary, specialty and behavioral health care clinic is in the works in Far Rockaway. Tri-Med Health Pavilion LLC submitted an application with the state Department of Health to build and open the new site at 14-25 Central Avenue at a cost of $4.7 million according to the filing. The group is seeking an affiliation agreement with St. John’s Episcopal Hospital for the emergency transfer of patients, the filing states. The LLC’s members also have a stake in a licensed home care agency and social adult day care nearby.
A new bill in Albany would restore tens of millions of public health dollars that once flowed from state coffers to the city before they were cut by former Gov. Andrew Cuomo a year prior to the pandemic.
In 2019, Cuomo reduced the city's share of a state-backed public health reimbursement fund by close to half, costing the city an estimated $60 to $90 million a year that was used to pay for myriad public health functions. A bill introduced in the Assembly by Queens Democrat Jessica González-Rojas would bring the city's reimbursement back to pre-2019 levels, which she says will support sexual health and tuberculosis services, drinking water surveillance and naloxone distribution.
The state’s so-called general public health work program, also known as Article 6, reimburses counties and the city for services related to family health, disease control and prevention, emergency preparedness and environmental health. Cuomo reduced the city’s share of the reimbursement, originally good for 36% of qualifying expenses, to 20%, bringing the five boroughs out of line with other counties. When he first proposed cuts to the program, Cuomo said the city qualified for other public health funding, including from the federal Centers for Disease Control and Prevention.
The new funding push comes as legislative leaders negotiate Gov. Kathy Hochul’s $252 billion executive budget proposal under a shroud of uncertainty about key federal funding streams. Hochul is barreling ahead despite that uncertainty, proposing a 14% increase in Medicaid spending.
The Cuomo-era policy has meant fewer dollars coming to the city, where a majority of the state’s Medicaid recipients reside, contributing to racial disparities in statewide health care funding, González-Rojas said at a joint budget hearing of the state Senate and Assembly on Tuesday. Health Commissioner James McDonald acknowledged the policy created an unfair arrangement between the city and upstate counties but fell short of throwing his support behind the bill.
“I wasn't here when what was done was done, and I can't imagine why it was done that way. But it is odd that that's what we're living with, because it's really the very definition of the word disparity, isn't it?” McDonald told the committees, including González-Rojas.
The lost funding has meant a reduction in several public health services, according to González-Rojas. That included a drop in the number of overdose-reversal kits given to community providers, tens of thousands fewer clean syringes distributed and impacted immunization services, her office said. McDonald said he was particularly concerned about tuberculosis cases, which are rising in the city and nationally. In the last fiscal year, there were 684 reported cases in the five boroughs, a 28% increase from the previous twelve-month period, according to the mayor’s preliminary management report.
The Justice Department’s stunning move to drop charges against Mayor Eric Adams may do little to deter the most prominent person jockeying to replace him: Andrew Cuomo.
Although the ex-governor has not yet entered the mayoral race, he has taken steps to raise money through a super PAC, and several people who have spoken to members of Cuomo’s inner circle were left with the impression that he is highly likely to run, they told Crain’s. Other political observers remain skeptical that Cuomo will make a bid for mayor, given the office’s subordinate status to the statewide power he used to hold.
Cuomo’s months of waffling have all but paralyzed the city’s business and real estate leaders, who have been casting about for a viable candidate to support in the Democratic primary. Although he would run as a pro-business moderate, some private sector leaders have little affection for Cuomo, whom they view as unpredictable and vindictive.
Adams is well-liked in the real estate world, but he still looks like a longshot for re-election, leaving potential donors wary of backing a losing horse. The other, largely left-leaning candidates have not managed to endear themselves to the donor class.
“The general posture and tenor has been apprehension and trepidation,” said one real estate executive — who, like many others, requested anonymity to talk about the famously grudge-holding ex-governor. “The concern with Cuomo seems to be that if he becomes mayor he will be totally uncontrollable, and on his vengeance tour.”
That view is not universally held. One executive predicted to Crain’s that Cuomo would enjoy solid support if he runs, given his sheer strength in early polls; another noted that executives still view him fondly for his role in stabilizing the state’s precarious finances in the early 2010s. Landlords still revile the 2019 rent-reform laws that Cuomo approved, but the industry directs more blame at Albany’s Democratic lawmakers than at Cuomo himself.
Many expect Cuomo to wait to enter the race until shortly before the April 3 deadline, when candidates must submit 3,750 voter signatures to get on the ballot. There has been logic to his delay: although rivals have launched early attacks, Cuomo has not yet faced the barrage of criticism for past scandals that he will endure once he’s officially in the race, which could drag him down from the early polling honeymoon he has enjoyed.
Most of all, Cuomo has been waiting to see what will happen to Adams, whose similar political base of outer-borough Black voters complicates Cuomo’s path to victory. Although the DOJ’s decision on Monday gives Adams some new political life, the circumstances — his cozying up to Trump and collaboration with the Republican president on immigration enforcement — will do Adams no favors in a Democratic primary.
That, in turn, keeps Cuomo’s lane open.
“For all the voters that are going to be upset with the mayor about his flirting with Donald Trump, a lot of those voters are going to need somewhere to go," said Democratic consultant Chris Coffey. “A lot of people think Cuomo has to run, and I assume he will, and he’ll be in a good position.”
Cuomo spokesman Rich Azzopardi called the speculation “premature,” but added: “New Yorkers know he spent a lifetime fighting for and delivering for them, raising wages for millions of workers and actually building infrastructure projects that politicians merely talked about such as the Second Ave. subway, Moynihan Train Hall and the new Kosciuszko Bridge and delivering progress where Washington faltered, including passing the strongest gun violence prevention and paid family leave measures in the nation, and codifying Roe vs. Wade in state law before the Supreme Court overturned it, all while cutting taxes, reining in spending, and raising New York’s bond rating to the highest level in generations.”
Lander as foil
Cuomo has met privately with potential donors, elected officials, labor leaders and clergy as he considers a campaign. In those talks, the former governor pitched himself as “a moderate, pragmatic, results-oriented leader who can help reorient the city,” said one person familiar with the conversations.
In some of those conversations, Cuomo has positioned himself as a foil to City Comptroller Brad Lander, a progressive whom the ex-governor said could have a clear shot at City Hall unless he enters the race, two people said. (Lander has made his own effort to court business leaders, including in an early campaign stop at the Association for a Better New York.)
If he runs, Cuomo is expected to rely on an outside super PAC that could spend unlimited money in support of his campaign, although he would be legally barred from directly coordinating with the committee. Cuomo’s personal state-level campaign account contains some $8 million, but it would be difficult to transfer that money to a city-level account.
Exactly who will contribute to the pro-Cuomo super PAC is unclear. One well-connected business executive told Crain’s that he and his colleagues had not yet been approached for donations.
“Leadership in the city, whether it’s the business community or organized labor, is very respectful of the fact that the mayor is still in the race,” the executive said.
Rival candidates have already begun to attack Cuomo about the sexual harassment allegations that booted him from office and his handling of Covid-19 in nursing homes — emboldened by a recent poll that found his favorability rating dropping precipitously once voters are reminded of those scandals. An outside coalition of business and labor groups led by ex-Cuomo adviser Peter Kauffmann has also raised money for anti-Cuomo attack ads, but has not disclosed any of its funders.
Another political observer said Cuomo’s vengeful reputation will leave some corporate donors feeling as though they have little choice but to back him.
“If you're big and you've got money and you bet wrong, you can always make it up, right? With this guy, if you bet wrong, the perception is, you can't make it up. That's it, you're out.”
A Midtown storefront that was a fixture on Sex and the City has sold to a Texas-based entity, records show.
The 5-story building at 31 W. 54th St. was home to a boutique run by Spanish luxury shoe designer Manolo Blahnik for nearly four decades before abruptly shuttering in 2019. It had been featured in the HBO series as a sanctum for the show's lead character, Carrie Bradshaw, played by actress Sarah Jessica Parker. In 2020 Parker fulfilled her fictional character's dreams by opening her own shoe store — SJP — in its place. That too closed, in 2022, a year after Manolo Blahnik executive George Malkemus died, and the shop has remained vacant since.
The roughly 8,500-square-foot property, between Fifth and Sixth avenues, and its neighbor at 33 W. 54th St., were acquired by Austin-based limited liability company Arboretum Management for a combined $12 million, according to a deed that appeared in the city register Monday.
Stephen Kahng is the principal of Arboretum Capital and president of Texas-based Kahng Foundation, which was founded in 1997 and supports projects in arts and culture and education. Kahng, who also sits on several philanthropic boards, including the Hoover Institution of Stanford University and the Asian Art Museum of San Francisco, signed the deed on behalf of the buyer. It appears he also contributes financially through his nonprofit to the Museum of Modern Art, which sits around the corner from his two newly acquired buildings on West 54th Street.
Attempts to reach Kahng were unsuccessful by press time, and it's unclear what his plans are for the properties, both of which were built in 1920 and are currently vacant. No. 33 was formerly occupied by an Italian restaurant.
Robert Aronov, an attorney at the Queens-based firm Aronov Law, appears to have represented the buyer; he did not return a request for comment by press time.
The seller was New Jersey-based limited liability company M&Y Realty, which still appears to be associated with Blahnik. Its signatory was Gary Kleiman, records show, although Malkemus signed the deed acquiring the property in 2017 and for a loan in 2020, before he died, on behalf of the same entity. Crain's reported last year that Anthony Yurgaitis, the former U.S. vice president of Manolo Blahnik, whose late husband and business partner was Malkemus, had sold his co-op at 115 Central Park West for $14.5 million.
Currently on the Manolo Blahnik website, a pair of black leather pointed-toe pumps can be found for $1,250, and the high heel-shy can find a pair of navy blue suede ballerina flats for $895.
Not long after the pandemic upended the world of work, Vornado Realty Trust CEO Steven Roth predicted people would soon return to the office.
It took longer than he’d hoped, but on Tuesday Roth proclaimed the threat that remote work posed to his business, which owns 20 million square feet of Manhattan commercial space, is over.
“Work from home was a scare, but as we predicted it would not last and is not lasting,” he said. “Most have left their kitchen tables and are back at the office.”
Workers haven’t returned everywhere, though, and Manhattan’s office vacancy crept up to 23.3% at the end of 2024, compared to 22.8% in 2023, according to Cushman & Wakefield.
The vacancy rate is about half that in Roth’s buildings, which include Bloomberg LP’s headquarters at 731 Lexington Ave. and the newly redeveloped Penn 1 next to Penn Station. The vacancy rate fell by nearly a full percentage point in the fourth quarter, to 12%, according to results published late yesterday by Vornado. Rents for new leases came in 6% higher than expiring ones.
An emboldened Roth predicted demand for prime Manhattan office space will only grow.
“We expect rents to go up significantly next year,” Roth said. “Dare I use the word ‘spike.’”
Investors liked the sound of that and bid up Vornado’s shares by 2% on Tuesday, to $43 a share. The stock has enjoyed a strong recovery since falling to as low as $13 a share two years ago.
Roth is one of the few developers in the city who seems likely to build a new tower any time soon. He has teamed up with Rudin Management and Ken Griffin to develop a new building for investment firm Citadel at 350 Park Ave. He predicted high construction costs and elevated interest rates would prevent rivals from building new. Office rents would have to rise to about $200 per square foot to justify the cost of building, he said, which is about double the market rate for space in most prime Manhattan office towers.
If Roth is right, it would be grim news for rivals including BXP, which hopes to develop a new tower at 343 Madison Ave., and RXR Realty, which wants to build a supertall at 175 Park Ave.
When an analyst on Tuesday’s call asked how many projects like that could break ground soon, Roth proclaimed: “None.”
Its retail tenant was a high-concept restaurant that aimed to make diners feel as if they were eating inside a volcano.
It might be fitting, then, that 27 W. 24th St., a mixed-use site near Sixth Avenue in NoMad, now finds itself in the hot seat.
Real estate powerhouse Blackstone is seeking to potentially foreclose on the building's landlord, MJ Orbach Associates, for allegedly defaulting in September on a $66 million mortgage, according to a complaint filed Monday in Manhattan state Supreme Court.
Michael Orbach, the managing principal of MJ Orbach, a 40-year-old firm whose portfolio includes several nearby buildings, has not yet filed a legal response. And a phone message left for him at his Garment District office was not returned by press time.
But the broad contours of the situation with No. 27 are familiar — many commercial landlords continue to struggle to stay current on loans backed by properties that are peppered with empty floors.
Indeed, No. 27 currently has a less-than-ideal vacancy rate of 89%, according to CoStar. Among its vacancies is that retail space, which once contained the award-winning Indian restaurant Junoon for more than a decade. Rajesh Bhardwaj’s Junoon, which nabbed a Michelin star eight years in a row, closed during the pandemic but later relocated a few doors away.
Its replacement in winter 2023 was Journey, a screen-filled attempt at “theatrical gastronomy,” pairing videos of actors singing in far-off locations with dishes from those regions. It also had the volcano feature, a 20-seat screen-topped table that displayed lavalike imagery while waiters used dry ice to simulate smoke.
But after being stung by poor reviews about the quality of both the food and the service, the immersive eatery closed after about a year.
Despite its similarities to the plight of other Class B buildings, which are older and offer fewer amenities to tenants, No. 27’s case also has a few unique twists, court filings show.
Indeed, Orbach could have extended his loan’s maturity date by five years, according to the loan’s original terms, though not if his building were to have significantly declined in value.
And No. 27 was worth just $57 million last summer, according to an appraisal commissioned by Blackstone, a value less than that of its mortgage. As a result, Blackstone can move forward with foreclosure, the company’s suit argues.
Even though Orbach tried to countersue Blackstone over the tactic, a judge dismissed his case in October, filings show.
At the same time, Blackstone is accusing Orbach of failing to turn over several months of rent at the site, as he’s supposed to do in the event of a default. Blackstone wants the court to appoint a receiver to collect rent going forward.
Office tenants at No. 27 include Mercedes-Benz, branding agency Chermayeff & Geismar & Haviv, and life sciences-focused venture capital firm Sofinnova Partners, all of which pay an average of $55 per square foot annually, CoStar says.
In 2015 Orbach paid $92.5 million for the 11-story, 126,000-square-foot building, according to the register, and two years later used the site as collateral for a $66 million loan from Signature Bank. When Signature collapsed in early 2023, the FDIC was initially appointed receiver of its mortgages before offloading many of them.
Blackstone, which has been moving aggressively to foreclose on ex-Signature loan sites across the city in recent months, acquired No. 27’s note last year through the shell company SIG CRE 2023 Venture LLC, the register shows.
Andrea Roberts, an attorney with Holland & Knight who is representing Blackstone, did not return a call for comment by press time.
Two eternities ago (in July), I wrote that it would take an indictment to put a serious strain on the relationship between Mayor Eric Adams and the city's real estate industry. When that indictment actually happened one eternity ago (in September), it did indeed put the industry in a tough position, with few good alternative options when it came to this year's mayoral race.
But now, in a stunning development, that indictment appears headed for the trash heap thanks to an order from President Donald Trump's Justice Department to drop the case. The full implications of this — including whether it ultimately even happens, given the potential for the presiding judge to deny the request — will take weeks if not months to suss out. But in the short term, a happy reunion between the mayor and at least some of his real estate supporters seems likely.
Although the number of candidates challenging Adams in his rollercoaster of a re-election campaign has increased at a rapid pace amid his legal woes, virtually all of the major ones have entered the race to his political left. The result is that, despite the baggage he will still have even without an indictment, he remains the candidate most aligned with the views of developers and the like.
Granted, there is at least one other major candidate who might fit this description and who has long been rumored to enter the race: former Gov. Andrew Cuomo. However, competing against a trial-free Adams for the same voter base would seem to make his entry more unlikely, and there is no guarantee he would enjoy broad real estate support even if he did decide to run. The industry enjoyed plenty of wins under his leadership, yes, but it is also hard to overstate how much it still opposes the 2019 rent-reform bill, which passed under his watch.
Adams remains a flawed candidate as well, of course, or a "perfectly imperfect" one as he might put it. He was no sure bet to win re-election even before the indictment dropped, and although running for office without a looming criminal trial is (usually) better than running for office with one, there is a chance the order to drop the case could backfire. The mayor was not shy at all about cozying up to Trump ahead of this remarkable decision, and his campaign rivals have already accused him of putting his own needs before the city's to get out of his upcoming trial. That message could resonate in a city that remains a Democratic stronghold overall despite its notable rightward shift in November.
For now, though, expect a return to something resembling the pre-indictment campaign landscape, when many prominent figures in real estate were willing to overlook Adams' weaknesses and contribute to his campaign, often giving him the maximum $2,100 donation. He has largely stayed in their corner throughout his term, notching a major pro-development victory just a few months ago by passing the housing reform package dubbed City of Yes, and his latest State of the City address indicated he has no intention of slowing down on trying to make it easier for the industry to build.
Given Adams' record on real estate so far, and given their current alternatives, developers may decide to ramp up their support for him going forward even in the face of a trial and possible conviction. But it now appears that is a calculation they won't have to make.
Local oncologists and cancer experts say that a federal warning linking even moderate alcohol consumption to increased risk of cancer could prompt more public health measures to reduce the disease.
U.S. Surgeon General Vivek Murthy issued an advisory Friday linking alcohol to seven types of cancers, including breast, colorectum, esophagus, liver, mouth, throat and voice box, and suggested updating warning labels on alcoholic beverages to advise people about their cancer risk.
Federal policy mandating warning labels on alcoholic beverages can only be introduced by Congress, and it is not clear if the incoming Trump administration would back such a change. But city oncology experts say that the surgeon general’s call for greater awareness about the risks of alcohol consumption could be the first step to more public health efforts to prevent cancer.
Many oncologists already have conversations with patients who are diagnosed and treated for cancer about the risks of drinking alcohol, said Dr. Stephanie Bernik, chief of breast service at Mount Sinai West. The surgeon general’s advisory could prompt those conversations earlier and encourage general practitioners to talk to patients about their drinking habits long before a diagnosis.
“This brings that awareness to a different level,” Bernik said. “It really has to come from the primary care physicians who are taking care of these patients for their yearly check-ups.”
The advisory comes as cancers continue to rise in the U.S. Last year was the first time that there were more than 2 million new cancer cases in a single year, largely because of rising diagnoses of common diseases such as breast, prostate and pancreatic cancer, according to the American Cancer Society. New York has also seen an increase in breast, thyroid, colorectal and other common cancers in the past two decades.
There are many factors that contribute to rising cancer rates, but lifestyle habits such as diet and exercise play a role. Alcohol consumption contributes to roughly 100,000 cancer cases and 20,000 deaths in the U.S. each year, the surgeon general said. These cancers are preventable, with alcohol being the third leading cause of preventable cancers behind tobacco use and obesity.
The advisory counters long-standing advice that small amounts of consumption may carry zero to low levels of risk. The general public perception is that moderate drinking could be good for cardiovascular health, such as a glass of red wine at dinner, but the warning informs individuals that even moderate drinking can carry risks, said Dr. Jiyoung Ahn, a cancer epidemiologist at NYU Langone’s Perlmutter Cancer Center.
Bernik said that recommended drinking advice depends on each individual’s family history and cancer risk, but that the advisory should encourage patients to reduce their overall drinking habits.
Public awareness is the first step to implementing preventive health efforts that can reduce rates of cancer, said Dr. Jennifer Hay, a clinical health psychologist who leads the laboratory of genomics, risk and health decision-making at Memorial Sloan Kettering.
Similar warnings for smoking have reduced cancer rates in the U.S., Hay said. The surgeon general in 1964 issued a landmark report linking tobacco use to cancer. Although smoking-related cancers did not plummet immediately, subsequent public health measures such as mass media campaigns and warning labels on cigarettes have led tobacco use in the U.S. to decline and lowered cancer rates, she added.
“We’re not telling people not to drink,” Hay said. “We’re just promoting informed choice based on the most accurate, updated information about alcohol and cancer risk.” Warning labels are just one way to increase awareness, she added.
RADIATION INSTALLATION: Long Island Jewish Medical Center in Glen Oaks, Queens, is installing a new high-dose rate enclosure for the treatment of certain types of cancer with radiation. The project will renovate 443 square feet of space in the radiation medicine department on the first floor of one of the hospital’s extension clinics, according to a filing with the state Department of Health. Construction will cost just over $1 million and take five months to complete, the filing states.
CARDIAC SURGERY: Mount Sinai South Nassau is seeking to certify a new adult cardiac surgery program at the Oceanside-based facility, documents filed with the state Health Department show. The operating rooms for the new unit are under construction as part of a $145 million four-story expansion to the main campus that includes the conversion of 14 medical/surgical beds to six intensive care and eight coronary care beds, according to a previous filing with the state. The latest filings include a $1.3 million addition of equipment to the new ORs.
DOCTORS’ STRIKE: Mayor Eric Adams sent a letter to Doctors Council, Physician Affiliate Group of New York and Mount Sinai on Friday to urge the parties to come back to the bargaining table and avoid a strike. Doctors Council, a union representing public hospital doctors and physicians, announced that physicians from four public hospitals plan to strike on Jan. 13 if administrators don’t reach an agreement to improve their pay and benefits. Adams requested that the physicians, their employers and representatives from New York City Health + Hospitals commit to further negotiations with the assistance of a mutually agreeable mediator to help them reach an agreement. The mayor asked the parties to advise his office about their intentions to negotiate by the end of the day today.
Since the pandemic, labor shortages in the U.S. remain. However, companies are hiring new employees at a rate that outpaces the quit rate. This dynamic, referred to as the “great reshuffle” indicates that people and across the nation are searching for and landing better jobs with different employers and in new industries. This is especially true of certain sectors in New York City. There, for example, technology job growth is outpaced only by that of Silicon Valley.
As a result, employers are evaluating their health care benefit strategies to improve their talent attraction and retention abilities. Because even though salary budget increases should be on the rise in 2025, a paycheck isn’t necessarily enough for prospective employees anymore. Quality health care benefits are at the top of workers’ priority lists, with research revealing that eight in 10 Americans deem health insurance the most important benefit a job can offer.
Fortunately, Aetna®, a CVS Health® Company, is helping New York companies meet the needs of their current staff and talent pools. Many of our customers choose to implement flexible health plans with quality coverage that’s easy to use and tailored to their specific industry. This approach gives businesses a competitive edge in attracting and maintaining a healthy, productive workforce.
The limitations of one-size-fits-all health care
Most employees, regardless of industry, appreciate having access to affordable and convenient health care benefits catering to their and their families' needs. Along these same lines, most employers want high-touch collaboration with their health insurer that goes beyond plan design.
While that might be the case no matter the company, a closer examination of priorities and usage patterns shows that specific challenges can differ significantly across industries, meaning one-size-fits-all health plans aren’t the best approach.
Take a technology firm, for example. This larger industry category has expanded to include health tech, fintech, biotech and more—workplaces in the sector are fast-paced and employ diverse teams that demand robust and progressive benefits. Employees are open to using digital health care tools, too. They use fertility services more frequently and see 25 percent higher usage rates for behavioral health care.[1] So, Aetna built a best-in-class provider network that helps members get this type of care in person and virtually.
We recognize that a larger-than-average percentage of employees in this field may need to seek services for non-traditional conception assistance or advanced reproductive solutions. In response, we added designated Fertility Advocate nurses to our technology-geared plan designs. These individuals guide members through their entire care journey, from reviewing benefits to liaising with providers, conducting recommended screenings and assessments, and even reviewing pharmacy benefits—all the way to postpartum support. And for members’ overall fertility and maternity needs, Aetna has a variety of specialized partnerships that deliver best-in-class support.
Our benchmarking data also revealed that most employers in the tech space cover gender affirmation services beyond just advice, which stands out from other non-technology businesses. So, we enhanced our technology industry solution plans to include gender affirmation benefits and access to health professionals who are board certified to provide transgender health care. This means extra support for our members navigating the complex health care system.
This testimonial comes from an Aetna customer, a New York-based technology company that employs about 750 people, and speaks to some of these distinct needs.
“Many of our employees are part of the LGBTQ+ community or know or love someone who is. They’re often left with unanswered questions and are unsure how to find trust within the health care system. We’ve heard from our staff that they are appreciative of our Aetna case manager, as well as our Aetna gender-affirming care navigators. Both types of support help guide our employees with a lens that no other carrier is able to provide. Aetna bridges the gaps that people in this community too often face, which is an invaluable step in the right direction.”
The latest and greatest industry insights from Aetna
We conducted extensive research to gather insight into many of our other customers’ businesses and the unique needs of their staff. Here’s some of what we uncovered about additional key industries.
1. Health care.These employees take care of others all day long and don’t always prioritize their own care, resulting in elevated risks for obesity, musculoskeletal issues and diabetes, as well as 25 percent higher levels of anxiety and depression.[2,3]
2. Hospitality and retail. Service-industry workers usually have physically demanding jobs that take up nights and weekends, meaning they can’t always stay on top of their regular health care needs. In fact, their utilization of adult preventive screenings is seven percent lower and inpatient admission rates are seven percent higher.[4] These individuals also benefit from varied language solutions and 24/7 support from Aetna, from customer service to CVS Health Virtual Care.
3. Private equity. This industry is especially focused on performance and cost management across their portfolio, and looking for a health plan partner that can help drive strong health care trend management. Aetna helped our private equity customers save an average of 3.7 percent annually on medical costs over the last seven years.[5]
Leading the way with high-touch, flexible support
Beyond plan design, we recognize that workforce needs and priorities vary widely. So we provide our account, clinical, care management, and customer service teams with extensive, specialized training in the sectors they support. This means they have the knowledge necessary to deliver top-tier service tailored to each client. On top of this, Aetna local sales and service teams have a pulse on New York’s health care happenings—so all our customers in the state have relevant, nuanced support.
No matter what type of health plan your business needs, Aetna can offer you and your workforce access to a wealth of resources and solutions. Whether you’re introducing new benefits or rolling out incentives for primary care, our dedicated concierge customer service team can act as an extension of your HR staff to support your employees.
Then, as chronic or episodic care needs arise, Aetna care managers serve as single points of contact so that employees get the help they need along their care journey. And for claim and eligibility questions, our plan sponsor liaisons can help you isolate trends and opportunities to optimize health plan performance.
Supporting New York companies now and for what’s next
As Aetna collaborates closely with businesses and brokers in New York and nationwide, we continue to learn more about the unique challenges different industries face.
These insights inspire us to innovate on our health plan design and create flexible and user-friendly solutions tailored to the needs and desires of our customers. In addition to promoting better employee health outcomes, our industry-specific benefits help employers stand out when recruiting and retaining staff. Everything we do is shaped by our customers’ goals—because healthier happens together®.
To take your health plan to the next level, contact your Aetna® representative or visit Aetna.com.
Congestion pricing is finally here. After a decades-long, political and bureaucratic journey, most motorists traveling into Manhattan south of 60th Street are being charged a new toll geared at reducing street-clogging traffic and greenhouse gas emissions.
Just after midnight on Sunday morning, Jan. 5, the hotly contested tolls took effect. Cameras latched to toll gantries along the perimeter of what the Metropolitan Transportation Authority calls the Congestion Relief Zone activated and are charging drivers who enter the district. What motorists pay depends on what and when they’re driving.
Here’s what travelers need to know about congestion pricing.
What is the Congestion Relief Zone?
The MTA is tolling motorists who enter Manhattan at 60th Street or below on local streets and avenues. There are some exceptions: The West Side Highway, FDR Drive and the Battery Park Underpass are all officially outside of the congestion zone.
But drivers be warned: not all bridges and tunnels directly link up with highways, and if you exit onto a local street from a bridge or tunnel before getting onto a highway to continue your journey — or vice versa — you will be tolled. For example, exiting the FDR Drive en route to the Williamsburg, Manhattan or Queensboro bridges or the Queens-Midtown Tunnel forces drivers to first traverse local streets, and that will trigger a congestion toll. It doesn’t matter how briefly a driver stays in the zone, if they touch down on a local street within it, they’ll be charged.
How much are the tolls?
The toll for drivers behind the wheel of a standard passenger vehicle (car, SUV, pickup truck) is $9 for entering the congestion zone between 5 a.m. and 9 p.m. on weekdays, or 9 a.m. and 9 p.m. on weekends. This is for those paying with a valid EZPass. Drivers without an EZPass will be charged $13.50 by mail — the toll for other types of vehicles also rises without an EZPass.
Overnight tolls are significantly less: $2 for standard vehicles — less than a subway or bus fare. The toll for motorcycles is $4.50 during peak hours, and $1.05 during the overnight. Larger vehicles are getting hit with larger tolls; small trucks and non-commuter buses are charged $14.40 (and $3.60 overnight), while big rigs pay $21.60 during the peak hours (and $5.40 overnight).
Will I be charged multiple times a day?
Drivers of typical passenger vehicles will only be tolled once per day. But truck and non-commuter buses will be charged every time they enter the zone.
Will it cost more to take a taxi or Uber into the zone?
Slightly. Taxis, green cabs and black cars will be tolled a $0.75 surcharge for entering the congestion zone during both the peak and overnight hours. Uber and Lyft rides are being charged $1.50. The for-hire vehicle companies have said they intend to pass the charge on to passengers. For the first month of congestion pricing Lyft has said it will credit riders for the fee.
If I take a tolled-tunnel from New Jersey into the zone, will I still be charged the new toll?
The short answer is yes. But the MTA offers what they call a crossing credit during daytime hours, so it’s a little cheaper. For the Holland and Lincoln tunnels, the crossing credit is $3 for drivers behind the wheel of standard passenger vehicles ($6 instead of $9 for the base toll). The credit is $1.50 for those traveling on the Brooklyn-Battery and Queens-Midtown tunnels.
Are discounts available?
For a select few. Emergency vehicles, such as ambulances and firetrucks, are exempt. Vehicles transporting people with disabilities or health issues that prevent them from using mass transit are also fully exempt — regardless of whether they or a caregiver are driving. Drivers who had a gross income of less than $50,000 last year can get a 50% discount off daytime tolls for trips after their first 10 each calendar month. People who live within the congestion zone can apply for a tax credit, but they must make $60,000 or less annually.
Will the tolls go up?
Yes, the tolls are slated to increase in the coming years. The MTA is required by state law to raise $15 billion from the program to modernize the region’s aging subway, buses and commuter rail. Transit officials intend to achieve this mandate by selling bonds that are backed by the annual toll revenue. With this in mind, the base toll is set to rise to $12 in 2028 and then again in 2031 to $15 (the initially planned base toll before Gov. Kathy Hochul postponed the program from its expected June 2024 launch). The tolls on other vehicle types will also gradually increase those same years.
Could congestion pricing still be killed?
It’ll be harder to quash the program now that it's up and running. But there are still several legal challenges against the tolls that are making their way through state and federal court. President-elect Donald Trump has vowed to kill the program; but his ability to immediately do so is limited now that the program has already received the federal greenlight and is officially live.
Gov. Kathy Hochul is reiterating her efforts to make it easier to involuntarily commit and treat people with severe mental illness in the wake of a spate of violence in the subway.
In a statement Friday ahead of the new legislative session, Hochul decried a recent parade of “horrific incidents” in the transit system and repeated a playbook she has pushed for years to boost psychiatric hospitalization and court-ordered treatment. Her executive budget will include changes along those lines when it is released in the coming weeks, she said, without providing specifics.
But some experts say the focus on adding more legal fixes hides a lack of accountability and coordination among existing programs meant to reach people living on the streets. And some of the efforts Hochul lauded, like a push to create more psychiatric beds, have yet to come to fruition.
Crime in the subway was up in December compared to the previous year, punctuated by several heinous and apparently unprovoked attacks: a woman was burned to death on a train car in Coney Island, a man was shoved in front of a moving subway on New Year's Eve and multiple people were stabbed or slashed in separate events over the last week. The NYPD recorded 49 felony assaults in the transit system during four weeks in December, a 40% increase over the same period in 2023.
Hochul claimed recent attacks involved people with untreated mental illness and blamed them on a failure to reach homeless residents. The claim echoes several violent episodes in the past, in which perpetrators were previously known to law enforcement and mental health workers. But neither the governor’s office nor spokespeople for Mayor Eric Adams, who issued his own statement of support for Hochul’s latest call to action, have provided evidence that the most recent high-profile incidents involved people with a history of mental illness.
In her statement Friday, Hochul touted the steps she has taken to improve mental health services and flood the transit system with police and National Guardsmen. That included a $1 billion commitment to outreach and community-based services, supportive housing and psychiatric beds. But despite directives to remove more people by force from the subways, she said changes to state law were needed to make it easier for hospitals to commit people at risk of harming themselves. She also said state lawmakers should expand Kendra’s Law, a 1999 measure that allows court-mandated mental health treatment in the community.
That assertion is being challenged by a growing chorus of politicians and advocates both for and against more involuntary hospitalization. City Councilman Robert Holden, a conservative Democrat from Maspeth, Queens, accused Hochul of “moving the goalposts” in response to her statement Friday.
"Governor Hochul is gaslighting the public by punting the mental health crisis to the State Legislature under the guise of needing changes to Kendra's Law,” he said in a statement. “The truth is that Kendra's Law works when properly enforced, but city and state agencies have failed to follow through, and the Governor has failed to allocate the necessary resources to make it effective.”
Harvey Rosenthal, CEO of the Alliance for Rights and Recovery, a mental health advocacy group that opposes efforts to increase involuntary treatment, said a lack of accountability by providers and policymakers has allowed people like Jordan Neely, who was strangled to death on the subway after cycling through outreach programs, to fall through the cracks. “Despite accessing a variety of services, our systems failed to provide him with the level of persistent engagement and well-coordinated and accountable follow up he deserved,” Rosenthal said.
Many of the legislative changes Hochul has championed are already in practice through regulation, including a 2022 directive from state Mental Health Commissioner Ann Marie Sullivan that clarified the criteria for involuntary commitment to include people who fail to meet their own basic needs. The Adams administration has backed a piece of state legislation known as the Supportive Interventions Act, that would increase the number of practitioners able to issue orders of involuntary treatment, a tool the mayor has said would relieve logjams in hospitals but which some advocates for the homeless say could be prone to abuse.
Hochul also hailed her administration’s efforts to restore psychiatric beds that were taken offline during the height of the pandemic “so individuals who need care have a place to go.”
But some of the efforts Hochul lauded, like a push to restore closed psychiatric beds in hospitals, have yet to come to fruition. Of the more than 1,000 inpatient psychiatric beds that were shuttered during the pandemic, just 517 hospital beds had been restored as of November, according to Office of Mental Health. Hochul's marquee promise to bring the beds back online as a means to address the state's mental health crisis has proved difficult, as psychiatric beds are less lucrative for hospitals than medical beds. Despite state-imposed fines for not reinstating the beds and attempts to sweeten the pot with increased reimbursement for hospitals, the number of beds in private hospitals, where patients are often seen first for psychiatric evaluation, has not moved in a year.
Separately, the Hochul administration has set its sights on expanding the number of beds in a different type of facility, long-term state-run institutions, creating 200 new beds with plans to open another 200, said spokesman Avi Small. The restoration of only 190 general hospital beds is currently in planning out of a remaining 500, according to figures provided by Small.
UPDATE: This story has been updated to clarify how many offline beds have been restored at private hospitals and how many are newly created psychiatric beds at state-run facilities.
Mayor Eric Adams is replacing the head of a city office that works with nonprofit organizations, a shakeup that comes as nonprofits complain that the city is threatening their livelihoods by failing to improve a pattern of late contract payments.
Michael Sedillo, currently an advisor to First Deputy Mayor Maria Torres-Springer, is taking over as executive director of the Mayor’s Office of Nonprofit Services, Adams said Friday. Adams previously appointed Johnny Celestin to the same role in June 2024, after the mayor’s inaugural pick, Karen Ford, quietly departed months earlier.
City Hall did not mention Celestin in Friday’s announcement. Mayoral spokeswoman Liz Garcia said Celestin, a longtime nonprofit executive, was not removed from the post, but had decided to take a new role at the Economic Development Corp. working with minority- and women-owned businesses.
But the staffing change coincides with vocal complaints from the nonprofit sector that the city is stiffing organizations by taking months to pay them money they are owed. The city relies on nonprofits for a huge range of critical social services, and Adams has pledged to improve the late-payment issue.
But the problem has apparently worsened lately, due partly to a painful transition to the online payment platform PASSPort that has added delays. The leader of homeless services provider Breaking Ground told the City Council in June that her organization was owed $23 million by the Department of Homeless Services.
A nonprofit sector leader who was granted anonymity to speak freely told Crain’s on Friday that Celestin had been well-liked and that Sedillo, a former advisor for the mayor’s Office of Contract Services, is also held in high regard. But providers are concerned that the office is now on its third leader in three years.
The Adams administration has said it is focused on improving the payment lag problem. A 2023 reform designed to speed up contracts awarded through the City Council’s discretionary budget has succeeded in dropping those contracts’ processing time from an average of 366 days in Fiscal Year 2024 to just 46 days in the current Fiscal Year 2025, City Hall said. And since October 2024, the Office of Contract Services has cleared a backlog of more than $1 billion and processed over 3,700 invoices.
Adams on Friday also announced he was forming a new working group led by Deputy Mayor for Strategic Initiatives Ana Almanzar, in which City Hall officials will meet weekly to “examine contract performance data” and focus on speeding up payments.
Jocelynne Rainey, executive director of the philanthropic group Brooklyn Org, said at least three nonprofits that her group supports financially are considering shutting down due to late payments. Rainey told Crain’s she had been excited when Adams established the Office of Nonprofit Services in 2022, “but I have been really disappointed in the fact that that hasn’t done anything to move the needle in regards to these nonprofits getting the resources they need in order to survive.”
“This is the third leader that they've had for this agency,” she said, “and nonprofits are not getting any benefit from it as far as the movement of funding.”
The nonprofit Legal Aid Society said Friday that while it welcomed Sedillo's appointment, the city needed to do more to resolve the most pressing issues — like the inability of some nonprofits to even submit invoices for payment. Legal Aid and other defender groups have said the delays threaten their ability to give legal representation to vulnerable New Yorkers.
“These payment delays jeopardize the basic operations of nonprofits, especially smaller ones, affecting their ability to meet payroll and ultimately reducing access to critical legal services for New Yorkers who rely on them,” Legal Aid said. “If City Hall genuinely values the vital safety net nonprofits provide for our most vulnerable residents, Mayor Adams and his administration must take decisive, long-term action to address the systemic issues pushing these organizations to the brink of collapse.”
Of the 14 nonprofit legal groups that are pushing Adams to reform the system, none has received any payments for the 2025 Fiscal Year that began in July, since the city's Human Resources Administration has not yet approved their budgets, according to Legal Aid. Those groups are now on their fifth month of not receiving the city funding they are owed, even though their contracts were registered on time.
Two apartment towers on the Upper East Side have been sent to special servicing after their owners, two major players in New York real estate, defaulted on the properties’ mortgage.
The $540 million loan for 305 E. 86th St. and 160 E. 88th St. was sent last month to special servicing, where troubled mortgages get worked out, after a “payment default,” credit-rating agency KBRA said in a report yesterday. That indicates a monthly payment was missed by owners Meyer Chetrit and Stellar Management.
Chetrit is a principal at Chetrit Group, a developer with a portfolio of 14 million square feet nationally that once owned Chicago’s Willis Tower, the country’s second-tallest skyscraper after 1 World Trade Center. Stellar was co-founded in 1985 by Larry Gluck and Steve Witkoff, who went his separate way in 1997 and recently was tapped to serve as Middle East envoy in the Trump administration. Gluck passed away last year at age 71; his firm, which the Real Deal said is run by a partnership including his widow and oldest daughter, owns over 12,000 apartments in New York plus 2 million square feet of commercial space.
In 2014, Chetrit and Gluck teamed up to buy the Upper East Side buildings, called Yorkshire Towers and Lexington Towers, for $485 million. The 21-story Yorkshire, at the corner of Second Avenue and East 86th Street, has nearly 700 units and amenities including an indoor pool, saunas, and private balconies. It also shares 204 parking spaces with nearby Lexington Towers, which has about 125 market-rate apartments.
In recent years cracks have appeared in the buildings’ finances. Their combined occupancy rate of 90% early last year was six percentage-points less than in 2022, KBRA said. Net cash flow has slipped by nearly 25% in that period, to $27 million. A broker familiar with the properties said that rents for the more than 300 stabilized units haven’t kept pace with escalating costs, even as market-rate units command record rents.
The Yorkshire and Lexington also carry hefty debt loads, giving them little margin for error if rental revenue falls short. In addition to the $540 million mortgage, they have $175 million in mezzanine debt, KBRA said, which presumably comes with a higher interest rate. The mortgage comes due in 2027, the result of a 2022 refinancing in which Chetrit and Stellar extracted $55 million in cash from the properties.
Both the Yorkshire and Lexington were developed in the early 1960s. In 2016, Con Edison shut off the gas at Yorkshire after unauthorized electrical work was discovered on the premises. The building paid an $800 fine but city records show the code violation remains open.
Chetrit didn’t return a call to his office, and a spokesman for Stellar had no immediate comment.
Alcohol products like beer and wine should carry warnings of their links to cancer, the U.S. Surgeon General said Friday, citing an increased risk of developing tumors in the breast and other parts of the body.
Scientific evidence of the connections between alcohol and cancer has been rising for decades, but less than half of Americans recognize the risk, Surgeon General Vivek Murthy said in an advisory.
Alcohol causes about 100,000 cases of cancer and 20,000 related deaths each year in the U.S., Murthy said, far more than the 13,500 alcohol-associated fatalities from traffic crashes. Direct links have been shown between alcohol and at least seven types of cancer, he said, including those of the throat, mouth, esophagus, voice box, colon and liver, and more than 16% of breast cancers.
Shares of drinks makers declined on Friday, following the surgeon general’s announcement. Anheuser-Busch InBev, the maker of Budweiser beer, fell 2.8% in Brussels. Constellation Brands was down 1% in Friday trading in New York and Molson Coors Beverage Co. lost 2.7%.
Alcohol’s links to cancer have been known since the 1980s, and the substance is ranked as the third-leading preventable cause of the disease, after tobacco and obesity. More than 70% of Americans report having at least one drink a week, according to the statement.
The American Medical Association said the advisory and updating the label on alcohol “will bolster awareness, improve health, and save lives.”
“For years, the AMA has said that alcohol consumption at any level, not just heavy alcohol use or addictive alcohol use, is a modifiable risk factor for cancer,” Bruce Scott, president of the AMA, said in a statement.
The issue is a global one, with about 741,300 cases of cancer attributable to alcohol consumption worldwide in 2020. Yet in a 2019 survey, just 45% of Americans were aware of the risk posed by alcohol, compared with about 90% awareness for radiation exposure and tobacco each, the statement said.
Guidelines for alcohol consumption should be reassessed to account for their links to cancer, and doctors should highlight the danger when advising patients about drinking, the document said.
Of the 47 World Health Organization member countries with alcohol warning labels, only South Korea requires a cancer warning. Ireland will require a cancer warning starting in 2026.
While drinking alcohol has long been a social norm for American adults, sobriety has also gained popularity in recent years. In 2020, Anheuser-Busch InBev released Budweiser Zero; last year, Molson Coors released its non-alcoholic brand Naked Life in the U.S. Craft breweries like Sierra Nevada and Samuel Adams also offer alcohol-free beers. Younger Americans are even more likely than older ones to try to cut back on drinking alcohol, a January 2024 survey from NCSolutions found.
Representatives for AB InBev, French distiller Pernod Ricard, and LVMH Moët Hennessy Louis Vuitton's wines and spirits unit declined to comment. Diageo and Heineken didn’t respond to requests for comment. LVMH owns labels such as Moët & Chandon and Dom Perignon Champagne as well as Hennessy Cognac. Diageo is the maker of Smirnoff vodka and Don Julio tequila. Pernod Ricard brands include Absolut vodka and Jameson whiskey.
Trade groups have yet to weigh in on the announcement. The Distilled Spirits Council of the United States said it was still reviewing the advisory. WineAmerica, the National Association of American Wineries, declined to comment. The Beer Institute didn’t immediately respond to requests for comment.
A pair of new mixed-use towers containing hundreds of apartments and two car dealerships could rise on Manhattan's West Side along what has historically been known as "Automobile Row," records show.
Developers the Chapman Group, an Upper East Side-based national real estate firm with a focus on parking, and Friedland Properties, also based on the Upper East Side, are looking to rezone a swath of land adjacent to dog-friendly DeWitt Clinton Park in order to erect a 42-story building at 629 W. 54th St., which is currently occupied by a partially vacant 6-story structure, and a 38-story building at 801 11th Ave., which is currently occupied by a vacant 3-story car dealership, according to an application recently filed with the Department of City Planning.
The taller of the two buildings would contain about 617 dwelling units and 113,000 square feet of commercial space for an auto dealership, while the shorter would contain 447 dwelling units and about 85,000 square feet of commercial space, also for a car dealership, records show.
Chapman released an ad last year showcasing how the site, which sits just a few hundred feet from the Hudson River Greenway at the edge of the Special Clinton District — an area between West 41st and West 59th streets and west of Eighth Avenue that was created in 1974 to preserve and strengthen the residential character of the community — could accommodate a new residential tower of up to 45 stories as long as the city approved a rezoning of the property first, Crain's reported in September. It now appears that Chapman has followed through with the endeavor, filing the request in partnership with Friedland through two separate limited liability companies last month.
The proposed project would span more than 1 million square feet across the two buildings, including 939,934 square feet of residential space and 199,750 square feet of commercial space for the car showrooms in an area already peppered with luxury dealerships for brands such as Audi, Land Rover and Lamborghini. There is no cost estimate associated with the project, and construction is expected to be completed in 2029, records show.
But in order to break ground, the city must first approve the rezoning. The developers are also seeking special permits to facilitate potential land transfers from Piers 59, 60, 61, 81, 83, 98 and the Chelsea Piers head house, according to the application. The Hudson River Park Trust would need to approve these.
Robert Atterbury, executive vice president of park relationships and programs for the group, told Crain's that it is "willing to engage in business negotiations and required environmental reviews around the sale of some of our transferable development rights" and that "while this is just the beginning of a long process, if approved, the sales could help support creation of new public open space at Pier 76."
Neither Friedman nor Chapman, which are also working together on a 46-story residential tower on the Upper East Side, responded to a request for comment by press time.
This will be the year that makes or breaks Kathy Hochul’s political career.
The Democratic governor, who won a full term in 2022 and intends to run again in 2026, is at a crossroads. Her approval ratings are middling and she has never enjoyed widespread popularity. And unlike her scandal-scarred predecessor, Andrew Cuomo, she has not been able to intimidate well-heeled, viable challengers who could make life difficult during a campaign.
First, there’s the Democratic primary, where she seems increasingly likely to face Ritchie Torres, the young congressman from the Bronx who has given every indication he wants to run for governor. Torres, ideologically, profiles like Tom Suozzi, the Long Island congressman who ran to Hochul’s right in 2022 and was beaten easily. Torres, of late, has attacked Hochul for instances of crime on the subways.
But there are reasons to believe Torres, if he does run, could do far better than Suozzi. In 2022, Hochul was a new governor, and more voters were giving her the benefit of the doubt after she replaced Cuomo, who had resigned a year earlier in a sexual harassment scandal. That fall, the crime issue would first start to damage Hochul, with Republican Lee Zeldin coming within seven points of defeating her. She hasn’t been overly popular since.
Hochul does have tangible accomplishments to tout. She has boosted funding for public schools compared to Cuomo, signed into law new environmental and tenant protections, and managed an administration that has been mostly free of scandal, no small feat in Albany. Under her watch, the statewide Democratic organization has also started to function again after many decades of neglect and even sabotage. For law-and-order types who wanted the state’s criminal justice and bail laws weakened, she certainly accomplished that.
The trouble for Hochul is that many residents aren’t feeling overly optimistic about New York. Cost of living remains an enormous challenge. It is harder than ever to buy a house, and rents post-pandemic have been stubbornly high. Lingering anger over the migrant crisis has damaged her standing. Crime concerns haven’t helped, either.
And her waffling over congestion pricing — the tolling plan for Manhattan is finally set to launch on Jan. 5 — has pleased few constituencies. Progressives and transit advocates were furious in June when she temporarily mothballed the program. Outer-borough and suburban motorists who were infuriated about having to pay a new toll were not placated and haven’t given her much credit for lowering the peak charge to $9 from $15.
Torres is a strong fundraiser and could spend much more on the primary than Suozzi. As an Afro-Latino, he could hold appeal in nonwhite working class neighborhoods, and he’s forged a strong relationship with the Jewish community over his full-throated defense of Israel and criticism of pro-Palestinian protesters. He is, for now, an underdog, but he has a chance to pull off the upset against Hochul if he decides to run.
Her other problem is Mike Lawler, the Republican congressman from the Hudson Valley. Lawler, like Torres, is weighing a 2026 run. If Hochul survives Torres, she will have to fend off a Republican who is arguably more talented and formidable than Zeldin. Lawler has cut a more moderate path in Washington and is a proven vote-getter in a district that Joe Biden once carried. If the 2026 electoral conditions should be more favorable to Hochul — it will be President Donald Trump’s midterm, and a backlash to Republican policymaking is probable — Lawler will still be a feisty opponent and would likely make his staunch opposition to congestion pricing a centerpiece of his campaign.
All is not lost for Hochul. She’ll need to take a page out of the playbooks of more popular Democratic governors like Jared Polis of Colorado, Josh Shapiro of Pennsylvania, and Gretchen Whitmer of Michigan by delivering tangible goods for her state and reminding voters of what she has done. She will need to become, at the minimum, a better communicator. And she’ll have to offer a compelling argument and vision for what New York should be. Can she make New Yorkers excited about New York again? That’s her real challenge.
Ross Barkan is a journalist and author in New York City.
Two stars of design-based reality shows have said goodbye to their Greenwich Village home for the second time in a decade.
Nate Berkus and Jeremiah Brent have offloaded their triplex penthouse atop 39 Fifth Ave. for $19 million, according to a tax record that appeared in the city register Thursday. They had previously owned the home in a slightly smaller configuration from 2013 to 2016, before buying it back in 2021.
Featuring a living room with a fireplace, a kitchen with greenhouse-style arched windows and a wraparound terrace in a 15-story prewar building near East 11th Street, the co-op, the sale of which closed Nov. 7, according to the record, was officially transacted by a shell company, Clevenger Properties LLC.
But that company’s address is also that of Berkus’ Chicago office, and the company appears to have borrowed its moniker from Brent’s middle name, Clevenger. Also the No. 39 penthouse and its occupants have been the subject of recent stories in the design press.
The buyer in the deal is a bit of a bold-faced real estate name himself: Dexter Goei is the former CEO and a current director of telecom giant Altice USA, which bought Cablevision from New York’s Dolan family in 2016 for about $18 billion. In January Goei sold a pair of joined townhouses on nearby West 11th Street for a whopping $72.5 million, which appears to be a 2024 record for the townhouse sector by a long shot.
Berkus and Brent did well with the deal. According to the register, they paid a total of $11.1 million for the home in 2021 by way of two separate deals, an $8.9 million acquisition of the penthouse and a $2.2 million purchase of an apartment below it, No. 13C. They appear to have subsequently joined the units in a renovation worthy of the couple’s latest reality show, the HGTV series The Nate and Jeremiah Home Project, whose makeovers are intended to help “moving families get a fresh start,” the show’s website says.
In the stars' case, the additional floor was needed to accommodate the couple’s two young children, according to an interview that Berkus gave in 2022 to the magazine Architectural Digest.
It’s the couple’s second stint at the Rosario Candela-designed building. The first time around was from 2013 to 2016, and it, too, involved a major restyling. Berkus and Brent snapped up the penthouse, which then appeared to be located on just a single floor, as well as an apartment below it, No. 14C, for a total of about $6 million, the register shows. A combination, which turned the two apartments into a duplex, followed back then too.
In 2016 the couple sold the duplex to Charles de Viel Castel, a managing director of a Latin America-focused investment bank, for $9.8 million, records show, before relocating across the country to a Spanish Colonial home in the Hancock Park section of Los Angeles, based on news reports, and renovating the historic property.
In a whir of whiplash-inducing deal-making, they then sold the L.A. house and bounded back to New York, snapping up a townhouse at 66 Charles St. in the West Village in 2019 for $9.8 million. After fixing up that property, Berkus and Brent found a taker for it in 2021 for $12.6 million, according to a deed. Around then, De Viel Castel reportedly contacted the couple directly about selling the penthouse, which might explain why there are no marketing photos online showing it in its current state.
In his own estimation, Berkus is someone “who doesn’t hold on to real estate,” according to the Architectural Digest article, though the No. 39 aerie “was always the one that got away.”
The 10,800-square-foot Village mansion sold by Goei earlier this year, meanwhile, went to an unknown buyer who used a shell company, 137+1 Holdings LLC. Goei had purchased that site, at 138 W. 11th St., in 2016 for $31 million, records indicate.
Altice, which does business in the U.S. through the Optimum brand, offers broadband services in 21 states to 5 million customers.
Requests for comment sent to both Berkus’ and Brent’s offices were not returned by press time, and Goei could not be reached.
Roughly 1,500 nurses who work at Northwell’s Lenox Hill Hospital and its two Manhattan affiliates are set to get wage bumps and better staffing ratios after they secured a new labor contract this week.
Nurses at Lenox Hill, Lenox Health Greenwich Village and Manhattan Eye, Ear and Throat Hospital on the Upper East Side voted by 76% on Thursday to approve the new contract, according to the union New York Professional Nurses Association. The agreement comes with a more than 20% raise over three years, better pension benefits and expanded staffing requirements in some of Northwell’s busiest hospital units.
Organized labor has pushed for wage hikes and improved staffing within the nursing sector since the Covid-19 pandemic, when hospital working conditions led to patient care concerns and clinician burnout. A January 2023 strike involving more than 7,000 nurses employed by Mount Sinai and Montefiore sparked labor movements across the health workforce, including among resident physicians and home care workers.
The strike resulted in historic wage increases, mechanisms to hold hospitals accountable to new staffing rules – and a chance for other unions to achieve comparable pay rates, said Kathleen Flynn, president of the New York Professional Nurses Association. The labor movement also encouraged younger nurses, who previously may not have seen the value of a union, to get involved, she said.
“Now, I think they recognize that if you want to make significant change, you really need to have a union behind you,” Flynn said.
Margarita Oksenkrug, a spokeswoman for Lenox Hill Hospital, said the agreement “reinforces our commitment to providing a supportive work environment for our nurses, advances our goals of recruiting and retaining top talent, and supports the highest standard of care” for patients at the three hospitals.
The contract comes after the union bargained with Northwell for two months about improving staffing ratios, Flynn said. Northwell offered a contract that the nurses rejected because of its low staffing provisions, ultimately leading the union to threaten to go on strike in October. But the health system averted a strike by fulfilling some staffing requests and offering a pension plan that Flynn described as a “major tipping point” in the negotiations.
In addition to a $38 million wage package that will raise baseline salaries by between $21,000 and $29,000 in the next three years, the union secured a defined benefit pension plan – a “much richer” plan that could increase pension payments for nurses who choose to work at Northwell for many years, Flynn said. The nurses have an option to choose between two types of plans: a fixed contribution or one commensurate with their years of employment. The choice of pension plan is a rare offering at a city hospital system, Flynn added.
The contract includes better staffing ratios for Lenox Hill’s labor unit and postpartum department, Flynn said. It also adds staff to the emergency department at Lenox Health Greenwich Village – one of the many hospitals that is expected to see an influx of emergency visits after Mount Sinai Beth Israel closes, she added.
Northwell Health consists of 21 hospitals, but could have as many as 28 pending government approval of its planned affiliation with the Connecticut-based health system Nuvance. Northwell, which employs roughly 85,000 workers, brought in nearly $17 billion in annual revenue last year.
Lower Manhattan-based Metsera is one of the latest drug startups to throw its hat into the ring with the pharma giants dominating the multibillion-dollar weight-loss drug industry.
The company, founded in 2022, raised $215 million in a recent Series B led by Wellington Management and Venrock Healthcare Capital Partners after advancing multiple weight loss treatments in clinical trials. Metsera is part of a small group of start-ups carving a foothold in the new market, which has brought in billions for a handful of companies while also raising concerns about the safety of the nascent group of appetite-suppressing medicine.
The class of drugs known as GLP-1 antagonists have become one of the most popular treatments for obesity, diabetes and other metabolic diseases for their ability to control blood sugar and help patients lose weight quickly. The industry is booming, despite growing reports of adverse gastrointestinal effects and the risk of overdosing on the self-administered medication.
A handful of the most popular drugs, including Wegovy, Ozempic and Mounjaro, are made by just two multinational pharmaceutical companies, Novo Nordisk and Eli Lilly. The two companies have been developing new medications and ramping up their supply. Eli Lilly’s new drug Zepbound, which came on the market last year, accounted for $1.26 billion of its $4.4 billion in third-quarter sales of GLP-1s. Together the two companies reported making more than $39 billion on GLP-1 antagonists in the third quarter of 2024.
Metsera, based at 3 World Trade, isn’t the only startup hoping to bring a GLP-1 to market – several have sprung up over the last decade – but it is one of the biggest raisers. The latest fundraise brings the company’s total investments to $565 million, according to the research company PitchBook. Fidelity Management & Research Company, Janus Henderson Investors and others also participated in the latest funding round.
Metsera’s programs include once-monthly injectable GLP-1s and an oral medication currently in clinical trials. The latest trial of its leading injectable medication showed a 7.5% reduction in body weight over 36 days, the company announced in September.
The cost of the long-awaited project to replace Newark Liberty International Airport’s AirTrain system has jumped a whopping 75% to a $3.5 billion price tag. Construction on the new people mover will take place while the current system continues to operate; the new AirTrain is expected to be up and running as soon as 2030, according to Port Authority officials.
The board of the Port Authority of New York and New Jersey approved a $1.45 billion budget increase Thursday to build the 2.5-mile AirTrain project after officials said a Covid-related rise in construction costs and supply chain disruptions bloated the airport project’s budget from a previous $2 billion estimate.
“To get into the treetops of what happened on this program, the Covid-19 pandemic pause and the re-procurement of [elements] resulted in a five-year delay,” said James Heitmann, the Port Authority’s Chief Operating Officer during the board’s meeting. “So a lot of escalation costs hit the program, that’s probably the biggest driver of that increase.”
On Thursday the Port Authority also greenlit its largest and arguably most crucial contract for the AirTrain venture: A $1.2 billion award to California-based Tutor Perini Corp. and Connecticut-headquartered O&G Industries for the design and construction on the AirTrain’s elevated rail structure, known as the guideway, and for three new stations that will effectively become the spine for the Port Authority’s ongoing redevelopment of Newark airport. Tutor Perini and O&G will also create designs for a fourth station to be part of a future new Terminal B.
Efforts to revitalize the 28-year-old monorail system began in earnest in 2019 due to frequent breakdowns, but the project has since suffered multiple fits and starts. In 2022 the Port Authority received contractor proposals to build the system at significantly higher costs than officials had anticipated. If the agency had advanced project procurement then, the project’s costs would have swelled to $4.6 billion, said Heitmann.
The Port Authority instead chose to break up the project’s procurement package to spread out the risk of major delays. That work began in December 2023 with the Port Authority selecting Austria-based Doppelmayr for the design, construction, operation and maintenance of the new people mover system and its railcars. Port Authority officials also tapped Canadian engineering firm Stantec, in July, to design a new maintenance and control facility, along with eventually decommissioning Newark airport’s existing AirTrain system.
Construction is scheduled to begin in the third quarter of 2025, and the Port Authority, perhaps somewhat optimistically, plans to have the AirTrain operational by 2030. Demolition of the current AirTrain system would then get underway.
Port Authority officials are footing the bill of the cost increase by reducing and deferring spending on other projects, according to Heitmann. He declined to say which projects are being delayed or taking a spending hit.
The current AirTrain system serves an average of 33,000 passengers each day, or 12 million people annually, but Port Authority officials have long said the system is nearing the end of its useful life and requires extensive maintenance to keep operational. It first launched in 1996 and was designed in such a way that cannot be merely expanded to meet the airport’s growing needs. And so the bi-state agency has sought to take advantage of a broader effort to reimagine Newark airport by embarking on an overhaul of the AirTrain system.
“Our major airports are the front doors of this region,” said Port Authority Executive Director Rick Cotton. “A new AirTrain is essential to both meeting increasing volumes at our airports and delivering a world-class passenger experience for Newark Liberty passengers.”
The Republican sweep of the presidency and Congress has transformed what could have been a struggle to merely renew Donald Trump’s tax cuts into a multi-pronged campaign to slash levies in new and bigger ways.
The incoming Republican majorities in the House and Senate mean Trump can enact a tax bill without making concessions to Democrats. Republicans will only be constrained by how much deficit spending the party’s lawmakers and global financial markets can tolerate.
“That is the several trillion-dollar question,” said Rohit Kumar, co-leader of PwC’s national tax office and a former tax policy adviser to Senate Republican leader Mitch McConnell.
Owners of closely held companies and high-net worth families stand to benefit with Congress now more likely to renew expiring provisions in the 2017 law providing a 20% deduction on pass-through business income and an elevated estate tax exemption, said Gordon Gray, a former Republican Senate Budget Committee aide and now executive director of the Pinpoint Policy Institute.
Many Democrats campaigned on a tax-the-rich agenda and advocated paying for other tax cuts by targeting those provisions, as well as rolling back the law’s tax cuts for corporations and individuals making more than $400,000 per year.
Republicans’ election success not only bolsters the 2017 tax cuts but opens the way for consideration of ideas such as further cutting the corporate tax rate and exempting tips from federal income taxes, said Grover Norquist, an influential voice in Republican tax policy debates and president of the conservative group Americans for Tax Reform.
Trump enthusiastically promoted both the corporate-rate reduction and the break for tipped income during the presidential campaign and also promised myriad other tax breaks.
The first thing Republicans will have to negotiate is how large the tax-cut package will be and how much they’re willing to increase a federal deficit that reached $1.83 trillion in the fiscal year that ended Sept 30. Just extending the expiring tax cuts would drive up deficits by $4.6 trillion over 10 years, and all of Trump’s campaign plans would add much as $7.75 trillion, according to estimates by the Committee for a Responsible Federal Budget, a nonpartisan fiscal watchdog group.
Stephen Moore, a senior fellow at the Heritage Foundation and informal Trump adviser, said the tax cuts will stimulate economic growth and Republicans can also cancel spending approved under President Joe Biden to help offset the cost of the cuts. Still, the bill is likely to have some level of deficit financing, he said.
That sets up a clash within the GOP between deficit hawks and lawmakers who don’t think revenue losses from tax cuts need to be offset, said Sage Eastman, a Republican strategist and former aide to the House Ways and Means Committee, which has jurisdiction over tax legislation.
Republican Sen. Mike Crapo of Idaho, who is in line to chair the Senate Finance Committee, has said “pro-growth” tax policies don’t need to be paid for. The 2017 tax cuts did produce some positive economic effects, but they were far more modest than the Trump administration and some Republicans forecast, said Kyle Pomerleau, a senior fellow with the American Enterprise Institute.
“It will be important to watch to see if markets start to panic if enough deficit spending is being contemplated, or if they’ll decide to look through it,” said Martha Gimbel, executive director of The Budget Lab at Yale and a former White House economist under Biden.
Trump has vowed to impose a tariff of 10% to 20% on all imported goods plus 60% on Chinese products and promoted that as an offset for tax cuts. But lawmakers will have to decide whether to enact those tariffs in the tax bill so the revenue can be officially counted — a difficult vote for Republicans, especially those who want free trade. They could also just assume revenue would continue from presidentially imposed duties, even though Trump might later strike a trade deal that drops them.
“There’s always a way to make things work,” said Dave Camp a senior policy advisor at PwC and a former Republican chairman of the House Ways and Means Committee.
The Peterson Institute for International Economics estimates the tariffs could raise only about $225 billion a year. Kimberly Clausing, a former Treasury Department official in the Biden administration and a UCLA professor of tax law, said the GOP will probably overestimate the revenue from tariffs and ignore the negative economic impact of the duties.
Republicans have said they want to enact a tax bill within the first 100 days of Trump’s second term, though it’ll probably take longer to negotiate the details, Kumar said.
The narrow GOP margin in the House gives small bands of Republican lawmakers leverage to demand specific tax breaks, and the Democratic strategy will be to focus on vulnerable Republican members in swing districts to push them to support or oppose individual provisions, said Scott Mulhauser, a Democratic strategist and veteran of legislative policy battles.
“Any small coalition within the Republican Party can have a disproportionate influence on any sort of tax bill,” Eastman said.
The Republican “trifecta” also sets up a lobbying free-for-all among business groups to persuade lawmakers and the White House to create new tax breaks to boost their industries. That intensifies the internecine struggle among Republicans over what to include in the package and how to contain the cost.
Skeptics said they doubt all of the tax cuts Trump proposed during the campaign - which grew so numerous that even some of his advisers are unclear about which proposals he’s most committed to — would be enacted because of the cost and difficulty of instituting the entire list.
Trump promised he would restore the full value of the state and local tax deduction, or SALT, a popular break in high-tax states including New York, New Jersey and California. Trump’s signature tax law capped the value of that deduction at $10,000, regardless of marital status.
While some changes to SALT such as raising the cap or doubling the deduction for married couples filing jointly are possible, eliminating the limit entirely isn’t likely because of the revenue loss: $1.2 trillion over 10 years, according to the Committee for a Responsible Federal Budget.
Leases
Financial advisory firm takes space near Grand Central
Address: 825 Third Ave., Manhattan
Landlord: The Durst Organization
Tenant: Edward Jones
Lease size: 8,000 square feet
Asset type: Office
Brokers: Tom Bow, Ashlea Aaron, Sayo Kamara and Bailey Caliban represented the landlord in-house. Cushman & Wakefield's Stephen Riker and Bryan Boisi represented the tenant.
Sales
Yitzchok Katz's firm picks up Gowanus site
Address: 172 Third Ave., Brooklyn
Seller: Elo Organization
Buyer: Goose Property Management
Sale price: $22 million
Asset type: Development site
Empire State Building owner acquires another Williamsburg site
Address: 92 N. Sixth St., Brooklyn
Seller: L3 Capital
Buyer: Empire State Realty Trust
Sale price: $17 million
Asset type: Retail
Financings
Rockrose refinances Long Island City apartment building
Address: 43-10 Crescent St., Queens
Owner: Rockrose Development Corp.
Lender: Wells Fargo Bank
Loan amount: $40.5 million
Asset type: Multifamily
As office buildings go, 1 Park Ave. has a lot going for it. The Beaux Arts tower is in good condition, anchored by a high-quality tenant with long-term lease, and conveniently located between Grand Central Terminal, Penn Station and FDR Drive.
What the building at East 33rd Street doesn’t have anymore is a AAA rating.
One of a handful of properties in the city whose debt was deemed as safe as Uncle Sam’s, 1 Park was stripped of its elite status Thursday by S&P Global.
Although occupancy at the building is a robust 93.5%, it’s been down a bit ever since a French perfume company moved out two years ago. That vacant space may not get filled anytime soon because, in S&P’s estimation, the Vornado-owned building lacks the right stuff.
“The property, in our opinion, is a solid class B office building that may garner less tenant demand than well-located properties that are newer and contain class A amenities,” S&P said in downgrading the building’s $525 million mortgage to AA.
While 1 Park Ave. may be lacking in what S&P considers Class A amenities, the 20-story, 1 million-square foot tower has plenty to offer. Its intricate facade has patterned mascarons decorating large windows. A deep setback inside leads to a large lobby that’s been restored to showcase original features, including 20-foot cathedral-stone ceilings, large chandeliers and inlaid stone floors.
The lobby was deemed “excellent” in 2021 by KBRA, a rival to S&P in the bond-rating arena..
1 Park appears to be the third Midtown office tower to lose its AAA rating. 667 Madison, owned by Leonard Stern’s Hartz Mountain Industries, was downgraded in August. The same happened to Blackstone Group-owned 1740 Broadway in 2023.
Vornado Realty Trust acquired 1 Park in 2011 for $374 million. In 2014, the Canada Pension Plan Investment Board bought 45% of it for about $250 million. In early 2021, partners extracted nearly $200 million in cash from the property when the mortgage was refinanced. A few months later, the Canadian pension fund sold its stake in the building back to Vornado for $158 million.
AAA ratings are reserved for the most credit-worthy borrowers, such as the U.S. government, Microsoft and Johnson & Johnson.
But 1 Park’s mortgage was deemed AAA because, even though it’s for an older Midtown office building, 67% was leased to NYU Langone Health that operates Tisch Hospital four blocks to the east. NYU Langone houses administrative and clinical staff in 1 Park’s offices with 12-foot-high ceilings and large windows. It eventually broadened its footprint to 73% of the space with leases that don’t expire until 2038 and 2050.
Another big tenant, Robert A.M. Stern Architects, leases 7% of the building through 2033. Its office space includes a grand floor-through staircase on the 16th floor and a library that is an interpretation of one designed by Michaelangelo in Florence, according to the firm’s website. A common area outfitted with a gallery is used for cocktail-hour gatherings and opens to a planted terrace.
Unfortunately, there isn’t much margin for error when it comes to keeping a AAA rating and in 2022 1 Park Ave. sprung a leak.
Clarins, a French perfume maker, vacated 40,000 square feet of office space at a base rent of $72 a square foot. S&P said no one has filled the hole and occupancy has been “stagnant.”
It could stay that way, S&P said, because space is widely available in buildings along Park Avenue south of Grand Central. The Murray Hill office submarket’s vacancy rate is 17%, according to CoStar, which projects it will reach 20% in 2026, when 1 Park’s $525 million mortgage comes due.
Vornado declined to comment.
JPMorgan, the investment banking business of JPMorgan Chase, is further positioning itself as a player in the innovation economy, looking to fill a white space left by institutions that failed during the 2023 U.S. banking crisis.
Earlier this month, the firm released the first two ads in a series designed to increase its awareness among venture capital-backed early-stage business founders. The spots highlight customers Gridware and Gamma, a software company that identifies disruptions in electrical grids and an AI platform that creates presentations and slide decks, respectively. Each ad spotlights the clients’ founders and why they banked with JPMorgan.
Both spots are running on digital and social platforms accompanied by digital out-of-home placements in San Francisco. JPMorgan will roll out creative showcasing various clients into 2025.
The marketing push is the second phase of the Limitless Growth campaign JPMorgan launched in October 2023, which aimed to promote the firm’s stability as a banking partner at every step of an innovative business’ growth trajectory.
The Alt League provided creative services while Revery handled production and Dentsu partnered on media.
Servicing Silicon Valley startups
JPMorgan’s services include creating networking opportunities with investors for clients and discussing how their businesses fit into personal wealth management. The firm can also leverage its fortress balance sheets, which are financial statements that protect a company's assets and money by having more equity than debt.
“Following the market disruption and regional banking crisis, that was very attractive to many companies after they went through this traumatizing experience,” said Tanya Clark Marston, managing director and head of innovation economy marketing at JPMorgan.
Besides increasing awareness among founders, the campaign aims to affirm that JPMorgan works with companies of all sizes and dissuade early-stage founders from the notion that it only works with companies as giant as itself. It highlighted Gridware and Gamma to demonstrate that it can provide focused expertise to niche businesses.
“We want to make sure that they were in different sectors but also showcased the technology-based nature of things,” Marston said. “These are different types of companies than a small business startup that might be a more traditional revenue-generating company off the bat.”
JPMorgan also wanted to highlight California-based companies as part of its awareness-building efforts in the Bay Area, she added.
“There’s such a huge ecosystem and concentration of founders and funders here,” she said.
Leading the innovation economy
JPMorgan identified a dearth of banks catering to early-stage innovative and technological businesses following the collapses of Silicon Valley Bank, First Republic Bank and Silvergate Bank last year due to liquidity shortfalls and rapid deposit withdrawals. All three catered to tech companies and high-value individuals holding large deposits and marked three of the largest bank failures in U.S. history.
To prevent further destabilization, the federal government and regulators protected deposits at these banks and initiated takeovers. The Federal Deposit Insurance Corporation in May 2023 sold First Republic’s assets to JPMorgan for $10.6 billion. Some politicians criticized the move, including Sen. Elizabeth Warren, who said it showed how “deregulation has made the too big to fail problem even worse.”
JPMorgan began accelerating its innovation economy business, which it formalized in 2016, soon after the purchase, Marston said. Since then, it’s hired hundreds of bankers and set up dedicated teams for software, applied tech and climate tech clients as well as early-stage startups.
It’s currently opening new branches in the Bay Area to cater to the high-value clients previously served by First Republic. After initially struggling to provide those customers the luxury service they were accustomed to, JPMorgan in July converted old branches into financial centers where it studied its newfound clientele and reported findings back to its broader network. This fall, it opened its first of many Bay Area branches to put those lessons into action for techy, high-value clients.
Many of those clients are investors and founders in the innovation economy, Marston said. With a physical presence in 19 countries, JPMorgan is banking on its size and scale to beat digital-first competitors serving innovative startups.
“Where we feel we can bring so much more to the table is our global capabilities,” Marston said. “As a company scales and needs to go global, we can help with that.”
This article originally appeared in Ad Age.
The federal transition of power in just under 10 weeks to a second Trump administration has left many New York lawmakers trying to recalibrate their plans for the state through the next four years.
But at a Crain's networking event and panel Thursday night, Carlo Scissura, president and chief executive officer of the New York Building Congress, expressed optimism that many local infrastructure projects could make it through the federal approval process under President-elect Donald Trump. The key will be appealing to Trump's origins as a real estate developer and public persona.
That is especially true, Scissura said, when it comes to the renovation of Penn Station.
"It's very simple: Get him excited about it. Bring him here. Have him feel like it's a project that he could put his hands on and love and feel like one day people will say, 'Donald Trump helped get this done,' and now you got a new Penn Station," Scissura told Crain's Editor Cory Schouten. His Building Congress is a bipartisan association committed to promoting economic development, infrastructure investment and job creation within the real estate and construction industries.
Precise plans for how to renovate the Midtown rail hub are still up in the air. In June 2023 Gov. Kathy Hochul announced that the state would move forward with a $7 billion project to transform the station into a single-level facility with a wide-open entrance hall. The idea was to "decouple" that work from plans to build office towers around it, which would have helped pay for the renovations. Hochul said at the time that she would make up for the loss of funding by applying for a federal grant to advance design work.
With transit-friendly President Joe Biden in the White House, that money seemed like a sure thing. Even then, however, a $100 million grant request was initially rejected by the Federal Railroad Administration last year. The MTA applied again for a grant in July — a $96.7 million request in which the federal government would cover 75% of the cost. Hochul warned that New York had a "narrow window" to rebuild the station, Crain's reported in August. The feds this week announced two $72 million grants to the MTA, one of which is earmarked to pay for the reconstruction of Penn Station.
A Trump presidency, on the other hand, could make securing funding for Penn Station renovations — or any transit-related projects — more difficult, as he has not rallied behind many of New York's infrastructure goals.
But Scissura, echoing the sentiments of both Hochul and Mayor Eric Adams, who said earlier this week that they are open to working with Trump on addressing the state's and the city's needs, said he still has hope New York will get the money it seeks, especially with Rep. Hakeem Jeffries, leader of the Democratic minority in the House, and Sen. Chuck Schumer, his Senate counterpart, down in Washington advocating for the state.
"Our job moving forward as an industry is critical, and it is to ensure that the hundreds of millions of dollars that are still sitting in Washington trickle down to New York so that we can get a new Penn Station," Scissura said.
If anything is crystal clear after this November’s election, it’s that the affordability crisis in New York requires immediate action. Specifically, families and workers in the city can no longer tolerate skyrocketing rents. The city must take a two-fold approach to addressing this crisis: pass the zoning reforms included in City of Yes, and increase investment in housing affordability through expanded fiscal measures. These two sets of policies — zoning reform to allow for increased supply, and fiscal support for housing affordability — work together. They must both be implemented to truly meet the needs of New Yorkers who currently face an untenable cost of living and the risk of losing their homes.
Over the past 10 years, the population in New York City has grown at twice the rate of housing growth. The cost of housing – either renting or owning a home – jumped by almost 70% between 2012 and 2022. The economic research is clear: Constraints on housing supply have created major housing shortages in New York and other major metropolitan areas, and these shortages are driving up prices for households across incomes.
These price increases are driving population loss and economic insecurity across nearly all incomes. In the studies we conducted at the Fiscal Policy Institute of out-migration from New York state, we found that 36% of households that leave are moving in search of more affordable housing — more than twice the share before Covid. The highest rates of out-migration are households with annual incomes of between $30,000 and $100,000 — not those at the top of the income distribution.
Out-migration of working- and middle-class New Yorkers demonstrates a deep problem in the city and state; New York needs to make sure that families can stay and thrive, rather than needing to leave to find economic security. If the city is to maintain stable economic growth and a strong foundation that supports essential workers like teachers, nurses and public servants, the city needs to build more housing. Without a plan to dramatically increase housing, New York faces the possibility of economic stagnation and decline. Especially in the context of a federal administration that will likely weaken the social safety net and rights around the country, New York must expand housing, offering a home to those who will otherwise face persecution and eroded rights.
One major concern amongst critics of City of Yes is that it will not do enough to build truly affordable housing. This is a justified concern and one to be taken seriously; in order to provide affordable housing to low-income families, New York will need to expand access to housing vouchers, produce more units that are offered at permanently affordable rates, and continue stabilizing and improving the NYCHA housing developments. These are important complementary policies to commit to alongside the zoning reforms in City of Yes. We need both. Without increased housing all around the city, there simply won’t be space to house New Yorkers of all income levels.
The city can afford to invest in these complementary policies, despite the claims of some commentators and critics. In fact, recent city revenue forecasts have underestimated revenue and overstated impending deficits. For instance, while the fiscal year 2023 adopted budget projected a $4.2 billion gap in fiscal year 2024, the year in fact ended with a $4.4 billion surplus. The Independent Budget Office expects outyear revenue to exceed projections by an average $1.7 billion each year. While conservative revenue projections are a consistent feature of the city’s fiscal management, they have been more dramatic in recent years. Moreover, the city includes $1.5 billion in in-year reserves each fiscal year. This funding is available to support the city’s spending needs.
City of Yes, paired with deeper fiscal investments, will help alleviate the affordability crisis, spark new economic activity and make it possible for more people who want to live in New York to remain here. At a time when the livelihoods of New Yorkers and Americans are at severe risk, New York must act to promote housing, increase affordability and build an economy that works for all.
Emily Eisner is an economist at the Fiscal Policy Institute.
Crain’s list of the largest foundations in New York is back, accompanied by a list of the area’s largest nonprofits.
The 25 largest foundations, ranked by 2023 assets, averaged only a 1.2% increase from 2022.
The Ford Foundation remains at the top of the list with $16.8 billion in assets last year, up 2.5% from 2022. The foundation also reported $607.4 million in 2023 grants paid, down 15% from 2022.
Open Society Foundations and Bloomberg Philanthropies follow, holding their No. 2 and No. 3 places respectively. Open Society saw assets fall by less than 1% to $15.8 billion, and Bloomberg grew over 2% to $11.8 billion.
Unlike the Ford Foundation, Open Society and Bloomberg both reported jumps in 2023 grants paid. Open Society paid $1.2 billion, up 38% from 2022, and Bloomberg paid $3 billion, up 76.5%.
Across the list, Carnegie Corp. of New York (No. 8) saw the greatest spike in 2023 assets, up 15% to $4.1 billion, and Anna-Maria and Stephen Kellen Foundation (No. 22) took the biggest dip, down nearly 14% to $1.1 billion.
Combined, these 25 foundations had $106.2 billion in assets, and paid $9 billion in grants last year.
On the accompanying nonprofits list, which is ranked by 2023 expenses and excludes hospitals and universities, these 25 organizations saw expenses jump an average 9% from 2022. Meanwhile, 2023 revenue only increased an average 2%.
International Rescue Committee Inc. ranks No. 1 and it’s far ahead of the rest with $1.4 billion in expenses, up 12.5% from 2022. United States Fund for UNICEF and Doctors Without Borders USA follow with $858 million and $856.4 million, respectively.
Among these nonprofits, Project Orbis International (No. 21) reported the greatest surge in 2023 expenses, up 98% to $265.6 million. Leukemia & Lymphoma Society (No. 8) meanwhile saw the biggest decrease, down over 25% to $386 million.
Combined, these 25 nonprofits had $10.6 billion in expenses and $10.5 billion in revenue last year.
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Fewer migrants are flowing into New York these days, so the hotels the city has used to shelter them for years are emptying.
But though the city is gripped by building-conversion fever as a means to deal with housing needs, the newly-vacant lodgings may not end up becoming apartments, according to some developers, designers and hospitality leaders.
In fact, rejuvenated tourism and a limited number of new hotel developments will likely encourage some owners to renovate and reboot rather than reinvent or sell, they say. Besides, making homes out of tiny hotel rooms can be challenging, they add, while labor-agreement rules about compensation for lost hotel jobs can make conversions too pricey.
“Certainly some, if not most, of the hotels being used as migrant shelters will go back into service as conventional hotels,” predicted David Beer, a director of the nonprofit affordable housing developer Breaking Ground, which has made apartment buildings out of several hotels.
“During Covid, when hotels were struggling, would have been the time to seize the opportunity to convert,” Beer added. “Now maybe not so much.”
Inflection point
The hotel sector seems to be at an inflection point after hitting a peak earlier this year of about 15,000 migrant-occupied rooms, about 12% of total inventory.
This month city officials wound down contracts with two hotels that housed migrants, Hotel Merit at 414 W. 46th St. in Hell’s Kitchen and a Quality Inn at 153-95 Rockaway Blvd. in Springfield Gardens, Queens, near John F. Kennedy International Airport, according to the Hotel Association of New York, the trade group that has essentially coordinated the effort to fill tourist-depleted rooms with lucrative migrant tenants since the asylum seeker wave began in 2022.
And Vijay Dandapani, the association’s chief executive, expects officials to give more hotels the 30-days notice required to cancel contracts in the weeks ahead. “The number of migrant hotels will come down,” he said. “We just don’t know the pace.”
The New York Post first reported the news about the Hotel Merit and Quality Inn.
Demand has certainly dipped. The number of arriving asylum seekers is down 14% since January, according to data from city Comptroller Brad Lander, and more migrants have been leaving the shelter system than entering it since May.
And the population of migrants, many of whom were sent to the city by Southern governors as a political stunt, could see more dramatic decreases soon. President-elect Donald Trump said during his campaign he would round up and deport all undocumented migrants, though whether he follows through on the controversial vow remains to be seen.
With the evaporation of a dependable stream of revenue — up to $185 a night per migrant, guaranteed every night — owners and operators may be hurt initially, analysts say. But not everyone thinks they will take the major step of converting.
Because hotel rooms have grown increasingly smaller over the years, sometimes measuring as little as 200 square feet, several would have to be combined to create a typical apartment. And even then, squeezing in a proper kitchen might be challenging. “It’s major work,” Dandapani said.
But hoteliers may have to shell out money all the same. Indeed, having families live in rooms for months on end likely produced major wear and tear, so owners may have to install new carpets, drapes and bath fixtures at a possible cost of tens of thousands of dollars per room if they want to welcome conventional guests again.
Financial concerns
Not all hotels are resistant to conversions. Long-term stay versions are usually equipped with kitchens, which was the case at 90 Sands St. near Brooklyn Heights, a former 509-unit hotel for the Jehovah’s Witnesses organization that Breaking Ground turned into a 491-unit supportive housing facility in 2022.
But other sites have been a no-go for financial reasons. The developer sought to similarly reinvent the Paramount Hotel at 235 W. 46th St. in Times Square after it closed because of Covid in 2020. But the costs of paying severance to the hotels’ ex-workers under the terms of a citywide labor agreement, about “tens of millions of dollars,” would have made it way too daunting, Beer said.
Indeed, when a hotel becomes a residence, its workers are entitled to 15 days of pay for each year of service under a deal negotiated by the Hotel and Gaming Trades Council union. “It’s a hurdle that could keep these sites as hotels,” Beer explained.
He’s instead now focused on a different kind of migrant-hosting site, a former Baruch and Hunter College dorm at 1760 Third Ave. in East Harlem purchased earlier this year for $172 million from CenterSquare Investment Management and Principal Asset Management. Breaking Ground will turn it into a 434-unit affordable complex once the building’s migrant contract expires at the end of November.
Market fundamentals may also encourage owners to hang on to their lodgings. The supply of new hotels is limited, in part because of the three-year-old Hotels Text Amendment, which requires a time-intensive approval process for rezoned sites.
At the same time, tourism is approaching prepandemic levels. New York is on track to have 65 million visitors in 2024, according to comments from Andrew Kimball, the head of the city’s Economic Development Corp., at a Crain’s event Tuesday. That total is close to the 67 million tourists who came to the city in 2019, based on data from city marketing arm NYC Tourism + Conventions.
Still Kimball seemed torn about the best way forward. “I think a good amount of those hotels coming back online will be very positive,” he said Tuesday, but he added that pressing housing needs may lead to conversions of “some number of those hotels as well.”
Competition could result. Slate Property Group, a frequent affordable-housing developer, has been eyeing hotels for projects. Constructing units in existing buildings instead of from the ground up can halve development timelines, reducing them from about three years to one and a half years, a big difference for those desperate for a place to live, said Slate co-founder David Schwartz.
And though hotel rooms do often need to be combined, hotels lay out much more easily as housing than, say, offices, the other major real estate sector under consideration, Schwartz added.
Slate and nonprofit RiseBoro Community Partnership are now converting a former 360-room Hilton at 144-02 135th Ave. near JFK into a 318-unit affordable complex; a pool will be filled and topped with a greenhouse, while offices will be added in the lobby for case workers. But even Schwartz admits the hotel-to-housing model is a bit untested, suggesting the status quo of keeping them as-is could win the day.
“There needs to be a proof of concept for these kinds of conversions because people are naturally skeptical,” Schwartz said. “But there seems to be interest.”
This story has been updated to reflect that the Breaking Ground director's name is David Beer, not David Beers.
A fifth of hospitals in New York received top scores for reducing preventable infections, limiting injuries and improving staffing, according to a report released today by the Leapfrog Group.
Thirty-two of the 145 hospitals graded statewide got an A for safety this fall, an increase from the 17 New York facilities last spring that were considered the least dangerous places for patients to receive health services, according to Leapfrog, a Washington, D.C. based nonprofit that measures health care quality.
New York has maintained a relatively low number of A-rated hospitals in recent years, and still falls far below the nationwide average of 32%. But the state moved up to 34th place in the nationwide patient safety rankings, up from 39th place in the spring, the report said.
There’s still room for improvement, and more hospitals in New York should work towards improving safety measures so patients have greater access to safe and quality care, said Alex Campione, project analyst at Leapfrog. “It seems like we are getting there.”
The bump in A-rated hospitals is largely due to a decline in hospital-associated infections after the Covid-19 pandemic, Campione said. Hospitals nationwide have reduced the number of central line-associated bloodstream infections and catheter-associated urinary tract infections by 38% and 36%, respectively, as they’ve improved staffing and patient volume post-pandemic.
Ten of New York’s A-rated hospitals are located in the five boroughs. Five of New York-Presbyterian’s city campuses – Weill Cornell, Columbia University Irving Medical Center, Allen Hospital, Queens Hospital and Brooklyn Methodist – earned top safety marks. The A grade was a reversal for all five hospitals, which have not received an A since 2022, according to the data.
Other local health systems also scored high grades. NYU Langone’s campuses in Midtown and Brooklyn scored A’s, as well as its Long Island outpost, the data shows. Long Island Community Hospital in East Patchogue, which is in the middle of being acquired by NYU, scored a C grade.
New York City Health + Hospitals/Metropolitan in East Harlem also received an A, as well as Northwell’s Lenox Hill Hospital on the Upper East Side and Long Island Jewish Medical Center in New Hyde Park.
The bulk of Long Island hospitals that received A’s were under the Northwell umbrella: Mather Hospital, Plainview Hospital, South Shore University Hospital, Peconic Bay Medical Center, Syosset Hospital, Glen Cove Hospital and Huntington Hospital.
A handful of local hospitals earned a D grade, the worst of the patient safety metrics, including Maimonides Midwood Community Hospital, H+H’s Jacobi Hospital and North Central Bronx Medical Center and One Brooklyn Health’s Brookdale and Interfaith campuses.
The Leapfrog Group, founded in 2000, publishes hospital safety grades for roughly 3,000 hospitals nationwide twice each year. The nonprofit earned nearly $7 million in revenue in 2021.
SECRETARY KENNEDY: President-elect Donald Trump has tapped Robert F. Kennedy Jr. to be his secretary of the Department of Health and Human Services. The pick came after Kennedy closed ranks with Trump during his own unsuccessful bid for president, first as a Democrat and then as an independent. Kennedy has been an outspoken critic of common public health practices, such as treating drinking water with fluoride and requiring vaccination, and has raised concerns about food safety and environmental chemicals.
DISCOUNTED FARE: PATH train passengers with disabilities could see their fare cut in half under a new proposal from Gov. Kathy Hochul, New Jersey Gov. Phil Murphy and the Port Authority of New York and New Jersey. The reduced fare would bring prices in line with discounts already available for senior riders. The proposal will go through a public hearing process and must be approved by the Port Authority Board of Commissioners. If approved, officials plan to open applications for the program by spring 2025 with the lower fares available in the summer. Four public hearings in Lower Manhattan and New Jersey are scheduled in December.
OPIOID SPENDING: The Office of Addiction Services and Supports is partnering with New York University to evaluate the impact of the state’s opioid settlement funds. By 2029 the state is set to receive approximately $770 million from settlements with drug companies that helped fuel the opioid crisis, money intended to supplement the state’s substance-use services. The advisory board responsible for recommending how that money is spent wants to make sure the funds actually reach service providers and has raised concerns about a lack of transparency in the spending. The new partnership will examine how the funds are impacting addiction services, the provider workforce and naloxone distribution, among other areas.
SUPPORTIVE HOUSING: The city Health Department has awarded a $17 million supportive housing contract to Port Richmond-based Project Hospitality. The contract will establish 36 units of permanent supportive housing for residents living with HIV/AIDS and at risk of homelessness. The housing comes with services to meet a range of needs that help residents live independently. Project Hospitality currently holds contracts with the city worth more than $20 million, according to records kept by the city comptroller’s office.
The 53 honorees on our list of Notable Leaders in Health Care work tirelessly across the industry to ensure the wellbeing of New Yorkers and the city overall. Here are five leaders that serve the city's hospitals, insurance companies and social services safety-net. Read the full list here.
Michael Dowling, President and chief executive officer, Northwell HealthScope of work: As president and chief executive officer of Northwell Health, Michael Dowling leads a clinical, academic and research enterprise with a workforce of more than 87,000. Northwell Health is the largest health care provider and private employer in New York State, caring for more than two million people annually through a vast network of outpatient facilities and hospitals.
Biggest career win: Dowling participated in an invitation-only meeting hosted by the White House Office of Gun Violence Prevention. The meeting included health care leaders from across the country.
Other contributions: Dowling is a member of the National Center for Healthcare Leadership, the Greater New York Hospital Association and the Healthcare Association of New York State.
Michelle Drayton, Vice president for health equity, United Way of New York CityScope of work: Michelle Drayton is vice president for health equity at the nonprofit United Way of New York City. She is a health care executive with more than three decades of experience in program design and development, care coordination, public policy, grant writing and leading teams.
Biggest career win: Drayton implemented a social services platform to support the work of health care workers who are responsible for helping individuals access needed social and health services that improve their wellbeing.
Other contributions: The former founding director of Healthy Start/NYC, she spearheaded a campaign that raised more than $40 million in support of the organization’s mission to reduce infant mortality.
Sharen Duke, Executive director and chief executive officer, Alliance for Positive ChangeScope of work: Sharen Duke is executive director and chief executive officer of Alliance for Positive Change, a nonprofit that provides low-income New Yorkers living with HIV and other chronic conditions with access to quality health care, housing, harm reduction, coaching, peer training and job placements. She oversees a team of more than 150 people while managing a multimillion dollar budget.
Biggest career win: Duke has implemented peer education programs and forged partnerships with the city’s top hospitals, expanding and deepening the impact of Alliance. She also continues to strengthen workforce development initiatives.
Other contributions: Duke serves on the board of directors for the Communities Advocating Emergency AIDS Resources Coalition.
Susan Fox, President and chief executive officer, White Plains HospitalScope of work: Susan Fox is president and chief executive officer of White Plains Hospital. Since joining WPH in 2010, Fox has transformed the hospital into a tertiary hub of advanced care for the region. During her tenure, WPH has quadrupled its operating revenue to about $1.5 billion, while staff has grown to number more than 5,300.
Biggest career win: Under Fox’s leadership, WPH earned the “Five Star” designation from the Centers for Medicare and Medicaid Services in 2022, 2023 and 2024 – the only Hudson Valley hospital to achieve this recognition for three years running.
Other contributions: Fox was appointed to the national board of commissioners of The Joint Commission.
Ken Gibbs, President and chief executive officer, Maimonides HealthScope of work: Ken Gibbs has served as president of Maimonides Medical Center since 2016 and became chief executive officer of Maimonides Health in 2022. Gibbs oversees a staff of more than 7,000 and an annual budget of $2 billion. Under his leadership, Maimonides established the Maimonides Bay Ridge Emergency Department and opened the Maimonides Doctors Multispecialty Pavilion.
Biggest career win: In 2023, Gibbs developed a partnership with SUNY Downstate to provide cancer services to historically underserved Brooklyn communities. Maimonides also earned the LGBTQ+ Healthcare Equality High Performer Designation in the Human Rights Campaign Foundation’s Healthcare Equality Index in 2024.
Other contributions: Gibbs serves on the board of the Healthcare Association of New York State.
President-elect Donald Trump said he wants Jay Clayton to serve as U.S. Attorney for Manhattan, leading the Justice Department office known as being the sheriff of Wall Street. Clayton would replace Damian Williams, who is leading the criminal case against Mayor Eric Adams.
U.S. attorneys prosecute civil and criminal cases for the federal government in 93 districts and generally serve at the behest of specific administrations and depart when a new president takes office. Williams hasn’t announced his plans.
The position would mark a shift to criminal law for Clayton, who led the U.S. Securities and Exchange Commission during Trump’s first administration. Since leaving government, Clayton has served as Apollo Global Management's independent chair and returned to New York-based law firm Sullivan & Cromwell as a senior adviser.
The U.S. Attorney’s Office for the Southern District of New York, often called the “sovereign district” for its independent streak, handles many high-profile financial fraud cases, as well as those alleging terrorism, organized crime and public corruption.
As SEC chair under Trump, Clayton mostly succeeded in casting himself as an independent voice focused on protecting small-time investors from fraud and financial industry abuses rather than waging ideological fights. He cultivated relationships with Republicans and Democrats.
The Trump White House said in mid-2020 that it would tap Clayton to lead SDNY as the office was investigating Trump’s associates. In the end, his nomination never advanced.
“Jay is a highly respected business leader, counsel, and public servant,” Trump said in a post on Truth Social, saying that Clayton did “an incredible job” as SEC Chair during his first term.
Clayton didn’t immediately respond to a request for comment.
Trump has made it clear his administration’s priorities for law enforcement would include a focus on immigration-related and violent crimes and also has made no secret of his willingness to use the Justice Department to pursue his perceived adversaries. The SDNY is famous for tackling complex financial cases and appointees are historically veterans of the office.
In the past three years, the office brought several prominent cases including the prosecutions of FTX co-founder Sam Bankman-Fried and Archegos Capital Management founder Bill Hwang, both convicted of frauds following high-profile trials.
A lingering effect of the pandemic will soon end on Billionaires Row.
Four Seasons Hotel New York, which has been off-limits to the general public since Covid first blasted the city in March 2020, is set to reopen Friday, more than four years later after it closed.
When guests begin checking in, the 52-story Midtown high-rise at 57 E. 57th St., which began accepting reservations about a month ago, will add 368 rooms at a time of crimped supply, much of which appears to be a result of city government policy.
All year, officials have been cracking down on illegal Airbnbs, sharply curtailing where people can book a stay, while about 12% of the city’s inventory of hotel rooms, or 15,000, is currently occupied by asylum seekers and other migrants whom New York has a legal obligation to house.
And fewer lodgings, of course, has meant escalating prices, even if analysts say that some of those increases are inflation-driven.
Bargain-hunters will likely not be racing to 57th Street. Thursday on the Four Seasons’ website, the eight rooms still available for Friday night ranged from a $2,300 room for two to an $80,000 suite.
Straddling the block between East 57th and East 58th streets, and Madison and Park avenues, the Modernist tower with onyx ceilings, limestone walls and circular windows above its front doors seems to be greeting its next chapter in an uncharacteristically low-key fashion.
Marketing executives for the property, which is owned by Beanie Babies creator and billionaire Ty Warner and operated by Toronto-based hospitality chain Four Seasons Hotels and Resorts, had no comment by press time.
But their reticence might be because an earlier promised reopening, announced in June to happen in September, never came to pass.
Reports at the time indicated the hotel was considering selling off some of its rooms as condos, a common model for hotels in recent months such as the Surrey on the Upper East Side. But even though not all the rooms at the Four Seasons will be available immediately, the hotel does not seem to have filed an offering plan with the state attorney general’s office that would indicate a condo conversion is coming.
Designed by I. M. Pei, the architect behind the pyramid gracing the courtyard of Paris’ Louvre museum, the Four Seasons began construction in 1988 and opened in 1993 as the city’s tallest hotel, though it has since been eclipsed in that regard.
Indeed, New York’s only other Four Seasons, a 2016 offering at 27 Barclay St. near the World Trade Center complex, for instance, soars to 82 stories, even though condo units occupy the top floors of the tower there.
In April 2020, a few weeks after the pandemic began, the Four Seasons opened up about 60% of its rooms for free to doctors, nurses and medical workers involved with treating Covid patients, though they appear to have cleared out by that summer. Whether the building was renovated in the years since or otherwise improved is unclear.
But an extended-stay option listed on the website looks to be a new feature for the property. Also, its lobby-level Garden restaurant, a place to previously enjoy breakfast and lunch among Acacia trees, will start serving dinner next year in a first, the site says.
New York state spent $14.5 billion on home health care services for low-income residents without required proof they took place, an audit by state Comptroller Thomas DiNapoli found.
Claims for 82 million personal care services like housekeeping, meals and bathing didn’t have a matching electronic visit verification record, or EVV, according to an audit covering January 2021 through March 2023.
“We need to know that Medicaid recipients and New York state are getting the services that were paid for,” DiNapoli said in a news release on Thursday. “The state Department of Health needs to do a better job of protecting the integrity of those services and safeguard Medicaid funds.”
The audit included the consumer directed personal assistance program, known as CDPAP, which Gov. Kathy Hochul said this summer was one of “the most abused programs in the entire history of the state of New York.”
The state implemented EVV for personal and home health care services in 2021 and 2023, respectively, to validate service delivery and reduce improper charges by allowing entities to match EVV information to Medicaid claims to identify improper services charged to Medicaid. Home health workers submit information about their visits using a smartphone app, tablet or landline.
DiNapoli’s audit found a lack of oversight and monitoring of EVV records for in-home services contributed to the high number of payments that didn’t have matches.
The state Department of Health disputed the audit’s tally of unverified claims noting that about $2.7 billion of claims should not have been included in the report.
The agency said it is planning to implement a program to increase providers’ compliance with electronic verification and is reviewing current procedures to improve oversight.
In a generally disastrous election for Democrats, the House of Representatives emerged as a relative bright spot last week, as the party made slight gains in New York that will put Brooklyn’s own Hakeem Jeffries just a handful of seats away from the speakership.
As leader of the Democratic minority, Jeffries promises to be a thorn in the side of Donald Trump, the president-elect who may take a hostile approach toward his former state. And if a few surprise vacancies — or Democratic gains in 2026 — hand the speaker’s gavel to Jeffries, it would cap a carefully crafted 25-year rise by the Crown Heights native, who would make history as the nation’s first Black speaker.
Jeffries, 54, became the party’s leader last year after executing a remarkably smooth campaign to succeed Nancy Pelosi. Known as a careful and strategic operator, Jeffries is well-liked among New York power brokers, but less beloved in progressive circles.
“Very smart, very disciplined,” said Lupe Todd-Medina, a political consultant who has worked for Jeffries since his first unsuccessful campaign for state Assembly in 2000.
A savvy legislator with a pro-business bent, Jeffries has maintained an interest in New York politics even as his stature in Washington has grown. But aside from a commitment to end an unpopular cap on state and local tax deductions, it’s unclear how Jeffries might use his powers to the benefit of his hometown — his legislative approach is defined more by what he can successfully push through his fractious party than by any personal ideology.
Jeffries has not cultivated the same kind of bring-home-the-bacon reputation as his Senate counterpart Chuck Schumer, a fellow Brooklynite who will take a demotion to minority leader next year. But city leaders must have been reading the tea leaves for clues about how Jeffries would govern if he ever took command of a House majority. Kathryn Wylde, president of the business group Partnership for New York City, noted approvingly that Jeffries came of age as a corporate lawyer at Viacom and the firm Paul, Weiss before he entered politics.
“He has a very real sense of what business needs, and what it can contribute,” Wylde said. “What New York business appreciates about Hakeem is that he’s very focused on practical solutions. He doesn’t spout ideological rhetoric and is proud of working across the aisle on issues where we need to get something done.”
In political circles, Jeffries is renowned for his prodigious fundraising and message discipline. Although he is no firebrand orator, Jeffries can hold a crowd — in recent months, he traveled the state to stump for New York’s House candidates, typically delivering remarks without notes.
Despite finger-pointing in Democratic circles about who is to blame for Trump’s victory, Jeffries has emerged unscathed, and arguably even strengthened his internal standing thanks to the strong performance by Democratic House candidates in his home state of New York. Thus far, Jeffries has adopted a mild tone when discussing the president-elect — but told donors he would “hold the line” against any threats to democracy by Trump, Axios reported.
Wylde offered one concrete example of Jeffries’ plans: At an October meeting of the Partnership’s board, Jeffries vowed that his caucus would heed the demands of high-earning New Yorkers by not extending the loathed cap on state and local tax deductions once it expires in 2025.
“Everyone cheered for that,” Wylde said.
Trump, whose 2017 tax law created the SALT cap, has also pledged not to extend it, although its fate in the hands of Republican House Speaker Mike Johnson is unclear.
‘He’s still showing up’
Jeffries has endured years of comparisons to Barack Obama, and he has something in common with the ex-president: a failed first run for office. While still working as a corporate lawyer, Jeffries mounted an unsuccessful primary challenge in 2000 to Assemblyman Roger Green, followed by another in 2002. That second race taught Jeffries about the crucible that is Brooklyn politics: Months before the rematch, state lawmakers redrew the district’s lines to leave Jeffries’ home one block outside its boundaries, which would have left him ineligible if he sought to challenge Green a third time.
“It was a desperate act by a career politician trying to save his government job,” Jeffries told The New York Times in 2002.
In the end, Green’s 2006 retirement opened a spot for Jeffries to easily claim the Assembly seat in 2006, followed by a 2012 run for Congress in which he easily defeated firebrand City Councilman Charles Barron in the Democratic primary.
In recent years, Jeffries’ brand of business-friendly Democratic politics has sowed distrust among progressives. In 2018, Jeffries defeated liberal favorite Barbara Lee of California in an election for House Democratic Caucus chair, which quickly fed rumors that newly elected progressive Alexandria Ocasio-Cortez might orchestrate a primary challenger to Jeffries. (Ocasio-Cortez rejected the claims, and the two have maintained an uneasy alliance.)
Jeffries’ steadfast support for Israel has won him support from Jewish leaders and criticism from left-wing groups more sympathetic to the Palestinian cause, especially during Israel’s destructive war in Gaza. His critics often point to a 2014 speech in which Jeffries proclaimed, “Israel today, Israel tomorrow, Israel forever” — a seemingly accidental paraphrase of an infamous line used by segregationist Alabama Gov. George Wallace.
“If Jeffries is considered a progressive, the term has lost all meaning,” the socialist Queens Assemblyman Zohran Mamdani wrote on social media in 2022.
But Jeffries has paid little heed to critiques from the left. After all, although he represents such gentrifying neighborhoods as Clinton Hill and Bedford-Stuyvesant, his core constituents remain the churchgoing residents of Black central Brooklyn. A vivid example played out this spring, when Jeffries helped Bed-Stuy Assemblywoman Stefani Zinerman fend off a primary challenge by a socialist candidate. (While Jeffries himself mostly stayed above the fray, his senior adviser, André Richardson, repeatedly attacked the socialist candidate Eon Huntley as a carpetbagging gentrifier.)
“I think about my experiences: It's Brooklyn, the Black church, and it's hip-hop culture,” Jeffries told the rapper Fat Joe in an October interview.
Jeffries himself is a lifelong member of Bed-Stuy’s Cornerstone Baptist Church, where he spent his youth as an usher. He has said his religious upbringing shaped his leadership style. Even now, Jeffries takes pains to maintain a visible presence in his district, despite his duties in Washington.
“He’s still showing up in churches, whether or not there’s an election for him,” said Todd-Medina, his longtime adviser. “He remembers the church anniversary, the pastor’s anniversary. He’s showing up at the NYCHA burger-and-barbecue event in the summer. He’s still shaking hands with residents at the subway stations and asking them about their issues.”
“Now, we have to share him with the rest of the country,” she added, “and we have to get used to that.”
With average rents of just $1,550 a month, it’s no surprise that 96% of the apartments at 144-25 Roosevelt Ave. in Flushing are occupied. One reason so few are available is that the building is becoming a less attractive place for its landlord to own.
Cash flow is falling at the 161-unit building, where 160 apartments are rent-stabilized. That’s because increases set by the city’s Rent Guidelines Board — 2.75% this year — aren’t keeping up with rising overhead. Banks are providing less capital and as a condition for refinancing the Roosevelt Avenue’s mortgage its owners were forced to kick in more than $1 million.
Analysts say the deteriorating economics at 144-25 Roosevelt are typical at properties with a lot of rent-stabilized apartments. Apartments with regulated rents account for about a quarter of the city’s 3.7 million housing units. The value of buildings with these apartments has sunk by two-thirds since the state enacted a law in 2019 that limited profit opportunities for owners, according to brokerage firm Marcus & Millichap.
“There is no path to profitability that anyone can see right now,” said Seth Glasser, a Marcus & Millichap senior managing director.
Affordable housing is more scarce than ever, even though it is one thing everyone agrees New York needs more of. Production of affordable apartments in 2023 came in 20% below the four-year average ending in 2021, according to a report by the New York City comptroller’s office. Higher interest rates are one factor. Heavy turnover at the city Department of Housing Preservation and Development was another cited by the comptroller.
144-25 Roosevelt Ave., located near the end of the 7 subway line and a Long Island Rail Road station, was developed in 1962 and acquired in 2009 for $18.7 million by JRC Management, which owns 1,100 apartments around the city. Since acquisition the landlord invested $1.1 million in upgrading the apartments, or about $6,800 per unit. A call to one of its partners, Richard Podpirka, wasn’t returned.
Details about the Flushing building’s finances and its owners were disclosed in a report this week from credit-rating agency KBRA describing the property’s new mortgage.
Net rental revenue rose to $2.9 million last year from $2.8 million in 2022 and $2.7 million in 2021, the report said. But net cash flow fell to $1.5 million last year from $1.6 million in 2021 due to rising overhead. Insurance costs rose by nearly 50%, to $136,000, while utilities rose by 75%, to $355,000. Property taxes rose by 9%, to $752,000.
Even with higher costs, the building generates an 8% annual return for JRC.
Still, declining cash flow and rising costs created challenges for refinancing the building’s $17.6 million debt. Citigroup agreed to write a $16.8 million loan maturing in five years at a 6.4% interest rate. JRC contributed $1.4 million in cash.
While JRC had the resources necessary to refinance the mortgage and keep its property, Glasser said that many owners of rent-regulated buildings don’t.
“This transaction is not typical in that sense,” he said. “Clearly JRC is in it for the long run.”
The owners of nursing home conglomerate Centers Health Care will pay $45 million to settle a state lawsuit that alleged they stole millions in taxpayer funds while disinvesting from their facilities and allowing residents to suffer, state Attorney General Letitia James’ office announced Thursday.
Centers will funnel the bulk of that funding, $35 million, into four of its nursing homes – Beth Abraham Center in the Bronx, Buffalo Center for Rehabilitation and Nursing, Holliswood Center in Queens and Martine Center in White Plains – to boost staffing and resources to improve patient care, according to the settlement agreement. The remaining funds will be repaid to the Medicare and Medicaid programs.
The agreement marks the attorney general’s largest settlement to date to resolve claims of fraud and patient harm in the for-profit nursing home industry. Centers is one of the state’s largest for-profit nursing home chains, operating more than three dozen facilities across New York and New Jersey.
“Residents at these Centers nursing homes endured years of tragic and devastating mistreatment and neglect, while the owners made millions of dollars in profit,” James said in a statement. “Now, Centers and its owners will pay for the harm they caused and will continue to make major reforms at their facilities to ensure residents receive the care they deserve.”
James sued Centers last year as part of a handful of lawsuits that charged multiple nursing home owners with using government funds to enrich themselves at patients’ expense. James has reached settlements in two of those cases, but lawsuits involving Cold Spring Hills Center for Nursing and Rehabilitation on Long Island and the Villages of Orleans Health and Rehabilitation Center near Rochester are still ongoing.
In the lawsuit against Centers, the attorney general accused owners Kenneth Rozenberg and Daryl Hagler of creating a web of real estate and health care companies to hide profits, an alleged scheme that turned nursing homes into “money-making machines,” the complaint said.
The alleged scheme led to understaffing and patient harm, according to the attorney general. The 300-page complaint included graphic descriptions of alleged patient injuries and neglect that went on for a decade, including bed sores and wounds that went untreated and cases in which patients sat in their own waste for hours at a time.
Meanwhile, the owners diverted Medicare and Medicaid money for their own financial gain, according to the attorney general’s office. Rozenberg, who is also the CEO of Centers Health Care, purchased the Israeli-based El Al Airlines, while Hagler spent $130 million on three properties in Brooklyn and Queens, the complaint said.
Shortly after the complaint was filed, a judge granted the state’s request to appoint independent monitors to oversee health services and finances at all four nursing homes owned by Centers. Those monitors have been in place for more than a year and have begun to improve resident conditions, according to the attorney general’s office. But under the settlement agreement, the monitors will continue to oversee Centers’ nursing homes for an additional three years, and the owners are barred from selling the properties during that time.
The settlement comes as Centers has attempted to restructure its business. The nursing home conglomerate earlier this year quietly announced the proposed sale of its managed care plan, Centers Plan for Healthy Living, to the insurance giant Elevance for an undisclosed amount. New York state has a series of multibillion-dollar contracts with Centers Plan for Healthy Living, approving two worth $17 billion five months after the attorney general’s nursing home investigation became public, the Times Union reported.
Bronx-based Centers Health Care was founded in 1996 and operates nursing homes, home health service, adult day care centers and urgent care facilities. The company employs 37,000 people and serves more than 1 million patients each year.
Gov. Kathy Hochul on Thursday resurrected plans to toll people driving into the busiest parts of Manhattan, but at a reduced peak rate for most vehicles entering south of 60th Street. If all goes to the governor’s plan, New York would launch the country’s first congestion pricing program in early January just before noted toll-critic President-elect Donald Trump is inaugurated.
Hochul’s revised proposal would slash the toll previously adopted by the Metropolitan Transportation Authority’s board this spring down by 40%, reducing the $15 peak toll for most passenger vehicles to $9 and lowering the $3.75 off-peak charge to $2.25, according to state officials.
MTA officials have said that without the toll revenue anticipated from congestion pricing they would likely scrap some $16 billion worth of upgrades to the city’s subway, buses and commuter rail. State law requires congestion pricing to generate $15 billion to finance modernization work for the region’s aging transit infrastructure; Hochul said Thursday that the revised tolls would raise the $1 billion in annual revenue necessary for the MTA to borrow against.
“We're still getting the $15 billion to fund the MTA and drivers are paying $6 less,” said Hochul at a Thursday news conference. “This lower toll will still allow us to accomplish all — and I mean all — of the goals of congestion pricing: new modern signals, the long-awaited Second Avenue subway, new electric buses, elevators. And this will generate major investments for our suburban commuters as well.”
MTA officials are expected to expedite the new toll structure with a vote by the authority’s board on Monday. The state and city must sign an agreement with the Biden administration, which has been supportive of the plan, before the program can formally launch. It was not immediately clear if the tolls will eventually rise to the rates originally adopted by the MTA's board.
The governor’s plan comes after Hochul has faced months of mounting pressure from transportation advocates and state lawmakers to reverse her abrupt decision in June to shelve the tolling program less than a month before it was set to launch.
Hochul has long insisted that the pause was driven by cost-of-living concerns for drivers and businesses within Manhattan’s core. But critics have argued that the postponement was intended to boost Democrats running in competitive state congressional races; the timing of Hochul’s reversal comes just a week after the elections.
On Thursday, Hochul reiterated that a $15 toll “would really have hurt a working mom or working dad trying to make ends meet.” Hochul estimates that the peak toll reduction would save drivers who commute daily into Manhattan’s core roughly $1,500 annually.
Under a revised plan with a 40% toll reduction, trucks would be charged between $14.40 and $21.60 during peak hours depending on size. Passengers of taxis would see an extra per-ride surcharge of 75 cents while those taking an Uber or Lyft would be charged an extra $1.50 per trip.
Suburban drivers may be somewhat disappointed to see that their discount will also dip. The discount for passenger cars entering into Manhattan’s core through the Lincoln, Holland, Hugh L. Carey and Queens-Midtown tunnels during peak hours would drop from $5 to $3.
Meanwhile, car owners who earn less than $50,000 per year will receive a 50% discount on every toll after their tenth trip in the zone per month. Hochul said she has also directed the MTA to enhance service on at least 23 bus routes outside of Manhattan as part of the program.
Congestion pricing has the dual purpose of providing critical funding to the MTA while also reducing traffic to help clear the air and make it easier for drivers who must enter Manhattan’s core to navigate the city’s busiest streets. The MTA has already spent more than $500 million on cameras, software and other tolling infrastructure needed to roll out the system.
The U.S. Department of Transportation said Thursday that New York officials have shared the updated tolling plan with the department. Officials at the Federal Highway Administration, a division within U.S. DOT, are now “working expeditiously to finalize the needed steps to complete the agreement,” according to the agency.
A mix of business leaders and transportation advocates welcomed the governor’s double-reversal on congestion pricing and the mass transit upgrades the revenue will finance.
“Everyone from our students to our CEOs has a stake in a safe, modern and reliable transit system,” said Steven Rubenstein, the chairman of the Association for a Better New York. “We are pleased to see Governor Hochul is putting congestion pricing back on track. Let’s get this done as if the city’s future depends upon it. Because it does.”
Renae Reynolds, the executive director of the Tri-State Transportation Campaign, urged the governor to release a clear and specific timeline to advance congestion pricing before Trump returns to the White House and has an opportunity to make good on his pledge to kill congestion pricing during his first week in office.
“New York’s transit system is at a breaking point, and further delays are unacceptable,” said Reynolds.
Congestion pricing still faces legal opposition, including lawsuits filed by the Trucking Association of New York and Gov. Phill Murphy of New Jersey. And the program’s many detractors continue to vocally oppose the toll’s implementation.
A coalition of mostly Republican lawmakers Tuesday held a news conference to denounce Hochul’s congestion pricing restoration. The officials likened the tolls to an onerous tax on people who may have limited access to mass transit.
“Frankly, this plan amounts to legalized theft by a governor and state government that is out-of-control and out-of-touch with everyday New Yorkers," said Hudson Valley Congressman Mike Lawler.
American retailers are not waiting around to see if Donald Trump is serious about imposing tariffs of 10%, 20%, or even 60% on imported goods, as the president-elect has said he intends to do. Preparations are already underway, and, for some companies, have been for a while.
Retailers are diversifying supplier markets, stockpiling goods and warning consumers — or, rather, assuring investors — prices may go up if such tariffs are levied.
"People have been modeling tariff mitigation strategies for probably a year now," said Stephen Lamar, president of the American Apparel & Footwear Association. "They did not want to be in a situation where they woke up on Nov. 6 and all of a sudden Donald Trump is going to become the next president and now they have to figure out tariffs."
That is particularly true for companies importing from China. Trump has proposed tariffs across the board to the tune of 20%, but he wants the tax on goods from China to be more like 60%.
Some companies that rely heavily on China have begun shifting their sourcing elsewhere.
Take Long Island City-based shoemaker Steven Madden, for example. The company accelerated its plans to shift production out of China the morning after the election. "We have been planning for a potential scenario in which we would have to move goods out of China more quickly," said CEO Edward Rosenfeld during an earnings call last week. About 70% of the company's current production comes from China. "We've worked hard over a multiyear period to develop our factory base and our sourcing capability in alternative countries, like Cambodia, Vietnam, Mexico, Brazil, etc." Steven Madden now aims to reduce goods manufactured in China by 40% within the next year, up from its prior target of a 10% reduction.
Other importers are trying to front-run the tariffs by ramping up orders before Trump takes office and stockpiling goods to avoid potential tariffs down the road.
"People are trying to bring in product before Jan. 20," Lamar said, adding that ramping up orders is a band-aid solution but may provide some relief in the short term. "People have been telling us for months now that they are bringing in more products than they normally would."
The National Retail Federation is seeing the same things. "We’re hearing that some merchants will also move up shipments to avoid the costly tariff increases expected after Donald Trump returns to the White House," NRF vice president Jonathan Gold said in a written statement.
The CEO of shoe company Deer Stags, for example, called his agent in China the day after the election and ordered as much product as they could make, according to a report last week from The New York Times.
One potential side effect of that may be increased demand for wholesale storage spaces, particularly through third-parties, said James Breeze, CBRE's vice president of global industrial and retail research. "They are going to need more warehouses," he said. But given the uncertainty of product sourcing, "retailers and wholesalers are outsourcing this storage and distribution of goods to third-party logistic providers rather than entering into multiple leases themselves because they are not quite sure where they need the inventory to be."
Economists overwhelmingly agree tariffs at the level Trump wants would lead to higher prices for American consumers. A recent study from the NRF found Trump's proposals could increase consumer prices by $78 billion a year. "A tariff is a tax paid by the U.S. importer, not a foreign country or the exporter," Gold said. "This tax ultimately comes out of consumers’ pockets through higher prices."
A handful of retail executives have already begun talking about having to raise prices, too. Columbia Sportswear CEO Tim Boyle told investors during an October earnings call "it's going to be very, very difficult to keep products affordable for Americans" if those sorts of tariffs become reality.
For many big importers, there is a sense of deja vu that comes with anticipating new tariffs. They experienced a similar dynamic during Trump's first administration as they navigated murky trade relations with China. That both helps and hurts the current situation. Many have been diversifying their supplier markets for years, which means there is less work to be done now. Abercrombie & Fitch, for example, drastically reduced its reliance on China in 2019. On the other hand, this long history means retailers are already feeling the pain.
Some are not sure how much more they can take.
Bloomberg contributed reporting.
A just-built, mixed-use development in Williamsburg, surrounded by a number of bars and restaurants, is in contract to be sold to an anonymous new owner, records show.
Brooklyn-based developer Joel Schwartz, known throughout the borough for small-scale residential projects and snatching up vacant lots, is offloading 333 Bedford Ave. just a year after purchasing it and then erecting a building there, according to a memorandum of contract that hit city records this week.
The 5-story corner structure at South Third Street is less than a 10-minute walk from hip local establishments such as L'Industrie Pizzeria, Pies 'n Thighs, the Four Horseman and Misi. The lot had previously sat vacant since at least 2007, Google Street View shows, but the building that's now there contains a commercial unit on each of the first two floors — both of which are empty — and eight apartments above them across 6,518 square feet, records show. The 1,500-square-foot ground-floor space is being marketed for retail, and the 1,850-square-foot second floor as a community facility, according to the brokerage firm Tri State Commercial Realty.
Schwartz, who did not return a phone message left at his Williamsburg-based company, Southside Units, purchased the then-vacant lot in 2023 through an entity named after the address for $3.5 million from David and Benito Ruiz, according to a deed from that time. He saw through the construction of the building, which wrapped earlier this year, and then quickly made plans to part with it. He first entered into a contract to sell it to a private entity associated with upstate nonprofit the Lexicon Foundation, according to tax documents and city records.
That deal, however, was terminated this month for reasons that are unclear. Judah Zelmanovitz, an attorney at the Marine Park-based firm Fink & Zelmanovitz, which represented Lexicon, declined to comment. Zelmanovitz is again listed as the attorney representing the new buyer in contract with Schwartz — a New Jersey-based limited liability company also named after the address. Zelmanovitz declined to comment.
For his part, Schwartz is seeking to develop elsewhere in the borough. Over in Downtown Brooklyn, he filed plans to put up a 14-story, 117-unit mixed-use project at 236 Gold St., on the site of a longtime parking lot near Flatbush Avenue, Crain's reported in May.
Savanna is in trouble with another building, this time on Fifth Avenue’s high-end shopping strip.
A lender filed a preforeclosure suit against the developer Wednesday for being past due on a $242 million loan backed by 521 Fifth Ave., a mixed-use tower at East 43rd Street that’s home to a cavernous Urban Outfitters store and a large Equinox gym.
Wells Fargo claims Savanna was supposed to pay off the entirety of the loan by its maturity date of June 2021. But despite maxing out the allowed extensions on three occasions, pushing back the date till June 2024, Savanna has still not settled the mortgage debt, according to the suit, which was filed in Manhattan state Supreme Court.
Packaged in a commercial mortgage-backed security, the loan was used to finance Savanna’s $381 million purchase of No. 521 from SL Green Realty Corp. in 2019, according to the city register.
Wells Fargo is seeking to sell the 39-story, 460,000-square foot prewar tower near Grand Central Terminal to recoup its money, the suit says.
But the lender is also on a parallel track of trying to work out the defaulted loan, which was transferred to special servicer LNR Partners in August, according to a report from analytics firm Trepp.
Based on the same report, the 1929 tower, once known as the Lefcourt National Building, is only 77% occupied, which is often considered a red-flag level. Savanna’s website says floors 14 and 34 at No. 521 are now for lease, while commercial real estate service LoopNet says five different floors at the tower have vacancies.
Equinox, which occupies a multifloor berth representing more than 5% of the building’s space and which has been located at No. 521 since the late 1990s, has a lease that expires in 2035, Trepp explained.
It’s not clear how many years are left on Urban Outfitters’ lease. An email sent to the media contact for store parent company Urbn was not returned by press time. And Savanna, which has not yet filed a response in the suit, also could not be reached.
Some nearby properties have struggled to fill retail berths, despite the street’s high profile and allure for shoppers.
But executives with Urban Outfitters, a retro-themed apparel and home goods chain, which shuttered a location near Brooklyn Heights during the summer, have said it’s struggling to connect with Gen Z shoppers and so is considering a reinvention.
Park Avenue-based Savanna, co-chaired by Christopher Schlank and Nicholas Bienstock, has been navigating rough waters with some properties that appear overleveraged with debt. In 2023 it lost the Lee Building on East 125th Street in Harlem to lender TPG when plans to sell the site, located next to a Metro-North station, fell short. And a troubled loan backed by art-gallery-filled retail spaces at High Line-adjacent 525 W. 22nd St. was sent to a special servicer over the summer.
Savanna is also playing a peripheral role in an ongoing bribery investigation into Mayor Eric Adams focused on municipal leases in privately-owned office buildings. Savanna is an owner of 110 William St., a tower that was struggling with vacancies and debt until city real estate agency DCAS rented 25 of its 31 floors in a blockbuster 2023 deal that came after a lobbying effort by the landlord. But no one has been charged yet.
Barry Felder, a lawyer with Manhattan-based firm Foley & Lardner who’s representing Wells Fargo in the foreclosure case, did not return a call for comment.
As we process the results of our election, half of the U.S. is feeling euphoric and half is despondent. We are a fractured nation — that much is clear. We all need to reflect on the circumstances that have brought us to this place. Employers in particular have an opportunity and obligation to consider their role as stewards of the health and wellbeing of their workforce.
Employers are the largest providers of health coverage in this country, and we depend on them to provide us with family-friendly policies to empower us to raise our children and create thriving households. Those of us who live and work in New York state are lucky — under state requirements, employer-sponsored health plans must cover reproductive health benefits such as abortion and family formation services. However, eligibility limitations for healthcare coverage and paid family benefits mean that not all NY workers have access to these benefits.
Furthermore across the country, huge swaths of Americans do not have access to the basic reproductive and maternal health benefits they need to survive let alone thrive. Workers, even those who are insured, struggle to access affordable, quality health care, are unsure whether their health care covers preventative visits, contraceptives, abortion care, mental health services and prenatal care. If they are lucky, they may get maternity leave or parental leave, but so many do not. The stress and uncertainty around our ability to access health care while working and caring for families takes a significant toll. People struggle, families suffer, our faith in our social contract suffers and we all pay a collective price.
We know — thanks to data and stories — that when companies support their workforce with comprehensive and quality reproductive and maternal health benefits, workers and their families are able to take care of their basic needs. Discussing reproductive and maternal health is deeply personal, but in the two years since I launched Reproductive & Maternal Health Compass, I’ve been consistently moved by the stories people have shared about the real impacts — good and bad — that corporate reproductive and maternal health benefits have on their employees. Consider two anecdotes: A young professional shared that he and his wife wanted to start a family but first he wanted to get a new job after learning his employer had cut its paid family leave program; a woman shared that she works harder now than ever because she feels such loyalty to her employer after using their family formation benefits to start her family.
The experiences I’ve heard underscore how much these benefits matter regardless of gender, age, sexual orientation or job status. Many workers consider such benefits when evaluating a new job opportunity. All of this underscores that there is a compelling business case — a case that will continue to drive the employment choices of American workers — for providing these benefits.
Employers have an obligation and an opportunity to support, reassure and act on behalf of their workforce. There are many ways to do this that have nothing to do with politics.
1. Review: Take an inventory of the reproductive and maternal health benefits offered to your workforce with consideration for the different geographies in which workers are located. If your organization has workers in regions where access to reproductive health services may be restricted, consider how those employees can still access services. Consider eligibility criteria for various benefits offered and making it more expansive. Use your benefits vendors as a resource.
2. Reassure: A significant majority of the workforce want to work for a values-aligned company and believe that women’s health is under attack in the U.S., so communicate why reproductive and maternal health benefits are aligned with corporate values focused on well-being and caring. For workers in regions where access to reproductive health services may be restricted, provide information on how they can navigate their benefits plan to get the care they may need in a safe, confidential way.
3. Repeat: Surveys have shown that workers consistently feel they lack detailed information about their benefits packages. At the same time, companies spend about 30% of total compensation on benefits. This means that people teams have a business incentive to provide information about their reproductive and maternal health benefits frequently, clearly and through multiple channels.
Companies that want to do more for their employees can also leverage my organization's online benchmarking tool for a free diagnostic of how strong their benefits package is.
Flory Wilson is the founder and CEO of Reproductive & Maternal Health Compass, a nonprofit focused on advancing reproductive and maternal health benefits.
Sales
Developer swallows up Ditmars-Steinway home of Italian food wholesaler
Address: 18-81 Steinway St., Queens
Seller: Mike Rienzi
Buyer: Seagis Property Group
Sale price: $12.1 million
Asset type: Industrial
Prospect Lefferts Gardens rental changes hands in foreclosure auction
Address: 271 Lenox Road
Seller: Hello Living
Buyer: Greystone
Sale price: $10.4 million
Asset type: Multifamily
Postwar rental Richelieu Gardens trades in Jackson Heights
Address: 34-44 77th St., Queens
Seller: Algin Management
Buyer: Benedict Realty Group
Sale price: $13.5 million
Asset type: Multifamily
Financings
Concourse Village's Morrisania Corp. lands loan
Address: 280 E. 161st St., Bronx
Owner: Gilbane Development Co. and Settlement Housing Fund
Lender: Systima Capital Management
Loan amount: $74 million
Asset type: Multifamily
Local hospital profits jumped in September even as facilities continue to fend off financial woes dating back to the pandemic.
Hospitals in New York, New Jersey and Connecticut had a median operating margin of 2.4% through September of this year, according to the latest data from Chicago-based consulting firm Kaufman Hall.
Profits swelled by 42% from last year as more patients went back to the hospital after the pandemic and skyrocketing costs for labor and drugs have cooled. But regional hospital profits still trailed behind the nationwide margin of 4.3%, according to the data, which encompasses 60 regional hospitals.
Hospitals in the tri-state region have consistently struggled to catch up to the rest of the country in their post-pandemic recovery. The lag has persisted because there is a wide variance in profitability, as a small number of large hospitals boost their margins while some community hospitals continue to operate in the red.
There’s roughly 15% variance between the most and least profitable hospitals in the tri-state area, said Erik Swanson, senior vice president of data and analytics at Kaufman Hall.
“It tends to be more that the top third of hospitals are growing and the bottom two-thirds are stagnating,” Swanson said. “That growing variance is due to top performers pulling away from the pack.”
The profitability gap is clear among city hospitals. Big health systems such as NYU Langone and Northwell – which have hundreds of outpatient locations and several hospitals – have stayed well above water, while community-based hospitals that serve a large number of Medicare and Medicaid patients maintain deficits.
Despite the gap, there are some signs that the region is improving. Local hospitals spent less money on labor and medical expenses in September, which improved their bottom lines. “They are beginning to really catch up to what the rest of the nation is doing,” Swanson said.
Overall expenses among tri-state hospitals declined 10% year-over-year through the month of September, the data shows. The decrease was driven by a 12% drop in labor costs – a line item that has historically been more difficult for New York to overcome because of its competitive health care labor market.
The decline in expenses eased pressure on hospitals’ profitability, even as revenues dropped. Overall revenue declined by 2% from the previous year, with inpatient earnings down more than 5%, the data showed. Swanson said that the revenue declines were largely because of a dip in volume as fewer sick patients went to the hospital.
The variance in profitability between the most and least profitable hospitals in the region is largely dependent on whether facilities can diversify their revenue sources, Swanson said. Hospitals that build ambulatory surgery centers and outpatient clinics, improve radiology and pharmacy offerings and expand their footprint in other states are likely the ones that will keep growing.
“Can the smallest ones do all that? Not necessarily,” Swanson said, a fact that is expected to fuel more hospital mergers and acquisitions. “Can some of those smaller hospitals exist without those partnerships? The answer may be no.”
A historic lack of rain. Dozens of brush fires, including one Wednesday in Inwood Hill Park. Rail disruptions fueled by a blaze near tracks. These conditions sound like they’re describing the western U.S., but they’re a result of a severe drought plaguing New York City.
Climate change is helping to fuel unusually dry weather in the Northeast and has brought the region a new kind of fire season. As a result, New York City is having its driest fall (since records began in 1869) and is under its first drought watch in more than 20 years. In just the last two weeks the city’s firefighters have battled a record 229 brush fires — an alarming spike from the roughly 200 that burned in the boroughs each year during all of October, according to FDNY data.
“Typically, we have some dry periods, but nothing like we've experienced with being fairly dry not just throughout October but going back to September, so this is highly unusual weather,” said Mark Wysocki, former New York state climatologist and senior lecturer of earth and atmospheric science at Cornell University.
The situation is a product of a weather pattern that has sent drier conditions to the Northeast and Southwest, while states across the Southern Plains and Southeast have been walloped by a concentration of recent storms, according to Wysocki. Climate change can create unpredictable weather patterns, and long-range forecasting shows the current weather trends fueling drought in the Northeast to continue into the winter, added Wysocki.
“We're starting to see these patterns show up where there's no longer a normal transition, but rather, very rapidly, there’s feast or famine,” said Wysocki. “And because of that it's going to be very difficult for municipalities and for agriculture to try to adapt with this new kind of climate.”
Fires have ignited in parks throughout the city, including Fort Tryon, Van Cortlandt, Flushing Meadows Corona, Brookfield Park and perhaps most notably: a weekend brush fire scorched two-acres of Prospect Park. On Saturday afternoon, after firefighters had extinguished the Brooklyn blaze, a steady stream of visitors stopped to gawk at the wreckage of blackened tree trunks and charred branches. The sharp scent of burnt wood hung heavy in the air.
The scene was a sort of climate reckoning for New Yorkers not typically exposed to wildfires.
Parts of New York state, New Jersey and Connecticut are similarly battling blazes. The Jennings Creek wildfire, burning on the New York-New Jersey border, has burned more than 5,000 acres and killed Dariel Vasquez, an 18-year-old New York state parks employee who was fighting the fire.
“It is a more extreme fire season than we have seen in recent history,” said Captain Scott Jackson, a Fire Management Officer for the New York state Department of Environmental Conservation.
Last week Mayor Eric Adams temporarily ban grilling in parks, while on Tuesday Gov. Kathy Hochul instituted a state-wide burn ban in an attempt to limit the fire risk. Both city and state officials are also urging New Yorkers to conserve water. The five boroughs alone consume one billion gallons of water each day, according to New York City Emergency Management Commissioner Zach Iscol.
If the drought continues, restrictions on water use are likely on the horizon, said Wysocki.
“We don't have the kind of firefighting equipment that they have out in the west, with all the helicopters and things like that,” he added, “so we have to be very cautious over the next couple of months.”
Apartment rents were back up in Manhattan last month, as pressure remained high on rentals thanks in part to persistently high mortgage rates keeping would-be buyers out of the homeownership market, according to the latest report from Douglas Elliman and Miller Samuel.
The median October rent for the borough was $4,295, up slightly more than 2% month over month and year over year, the report says. Renters signed 5,857 new leases, and 9,268 apartments were on the market, both down from September but up significantly from October of last year. Manhattan's listing discount and vacancy rate both stayed relatively stable, at 1.7% and roughly 2.8%, respectively.
In Brooklyn, the median rent was $3,600 last month, down 1.4% from September but up 3.2% from October 2023, the report says. Renters signed 3,752 new leases, down month over month but almost twice as high as last year, while listing inventory was at 5,160 apartments, down 9.1% from September and up 19.3% from October 2023, according to the report. The listing discount was -2.1%, meaning many apartments rented for more than their initial asking price.
And in northwest Queens, the median rent was $3,350, down 4.3% month over month and up 4.8% year over year. The number of new leases was 723, fewer than in September but up more than 70% year over year, while listing inventory increased month over month and year over year to reach 938 apartments. As in Brooklyn, apartments typically went for more than their initial asking price, with a listing discount of -1%, the report says.
The Federal Reserve made its long-awaited interest rate cut in September and cut rates by an additional quarter of a percentage point earlier in November. These moves should presumably help lower mortgage rates as well, reducing pressure on rents by opening up the housing market to more buyers, but there has not been much significant movement on this front so far.
"We've been seeing mortgage rates trending higher since the Fed cut. As a result, we're seeing rents rise across all three boroughs," said Jonathan Miller, CEO of Miller Samuel and author of the report. "I think it's in direct response to the diminishing affordability caused by rising mortgage rates."
Although more rate cuts at the Fed are likely in store for the end of 2024 and early in 2025, the potential for tariffs to be a major feature of economic policy under the incoming Trump presidential administration will likely limit how much impact they have on lowering mortgage rates, Miller told Crain's.
"The idea of improved affordability is much more remote than it was just two months ago," he said.
The state’s hospital industry is vying to secure its interests before Republicans take control of the White House and U.S. Senate next year.
In a “lame duck” agenda released Wednesday, the Greater New York Hospital Association outlined its priorities for the remaining weeks of the 118th Congress, calling for protections against billions of dollars in looming cuts to providers. The group, which represents around 280 hospitals and health systems in New York and neighboring states, is calling on its members to advocate for several large funding streams ahead of a Dec. 20 deadline to avert a government shutdown.
At the top of the list is a push to stave off cuts to a program that provides additional funding to hospitals with a large volume of patients who are uninsured or on Medicaid. The program, known as Medicaid Disproportionate Share Hospital payments, is set to receive an $8 billion cut on Jan. 1 that will continue annually through fiscal 2027 unless Congress intervenes. The reduction would result in a $1.8 billion cut per year to New York hospitals, according to GNYHA. The trade group also wants to see changes to the program’s funding formula that would eliminate an exception for services provided to Medicaid beneficiaries who are dually eligible for Medicare.
The campaign comes as GNYHA reels from the loss of a major foothold in Washington when Sen. Chuck Schumer, a Democrat who is arguably its biggest ally on Capitol Hill, enters the minority next year as Republicans take control of the Senate. Schumer has helped direct the flow of billions of dollars to local hospitals, and GNYHA has given millions to a super PAC closely tied to the outgoing majority leader.
Local hospitals could see other cuts if lawmakers enact a bipartisan bill to eliminate the higher reimbursement rates hospitals get for outpatient services in an effort to slash rising hospital prices. Currently, Medicare reimburses hospitals more than physician practices. Hospital leaders argue the arrangement is necessary to cover their high overhead, but opponents say it leads to high prices for basic procedures.
Also on the GNYHA’s agenda is an effort to boost payments for teaching hospitals, of which the state accounts for a significant portion of the national stock, and preserve pandemic-era waivers including one that has allowed more flexibility in the use of telehealth. The group also reiterated its push to preserve a prescription drug pricing program known as 340B, and wants to see expedited Federal Emergency Management Agency funds to reimburse providers for outstanding Covid-related claims.
EMPLOYER HEALTH COSTS: Midtown-based tech startup Bluespine launched out of stealth mode Wednesday to help self-insured employers manage rising health costs. Bluespine uses artificial intelligence for employers who pay directly for health care to detect claims errors or instances of overbilling, which has contributed to a 14% increase in employer health care spending in the last two years, the company said. The startup launched with a $7.2 million seed round led by venture fund Team8.
PEDIATRICS READY: All of Northwell Health’s emergency rooms have been designated “pediatrics-ready” through a state-led initiative to improve child safety in hospitals. Northwell’s 16 emergency departments are staffed with pediatric clinicians who have knowledge about kids’ medication doses and treatments, and are outfitted with child-sized equipment such as catheters and airway management tools. The designation, achieved through the state Health Department’s Always Ready for Children program, has been granted to 30 hospitals statewide.
NURSING HOME CONTRACT: Health care workers at five upstate nursing homes owned by Centers Health Care held a rally Wednesday as they bargain for a new contract. The workers, represented by labor union 1199SEIU, have been working under a contract that expired in December 2022 and are asking their employer to improve pay and staffing levels, the union said. Centers, which owns more than three dozen nursing homes in New York and New Jersey, is the subject of a state investigation alleging it diverted $83 million in taxpayer dollars away from patient care to increase profits.
Midtown-based drug discovery company Schrodinger has entered a deal to advance multiple projects with pharmaceutical giant Novartis that could generate $2.3 billion in milestone and royalty payments for the Manhattan firm, the company announced Tuesday.
Novartis is paying $150 million upfront to license several programs currently in the discovery phase with the hope of identifying drug candidates for clinical trials. Under the agreement, Schrodinger will be eligible for up to $892 million in research, development and regulatory milestone payments, plus as much as an additional roughly $1.4 billion in commercial milestones and royalties for each drug brought to market.
The deal also expands a three-year licensing agreement with Schrodinger to use its predictive drug discovery software, significantly increasing Novartis’ access to the technology. Schrodinger has not disclosed the size of its business with Novartis, but president and CEO Dr. Ramy Farid said it is among Schrodinger’s largest software customers. Last year the company reported that it had four clients that each spent over $5 million a year to license its tech.
The transaction follows the Swiss drugmaker’s multibillion-dollar spree to pad its portfolio of oncology treatments. Although Schrodinger specializes in cancer drugs, the acquisition does not include that class of pharmaceuticals, according to the company, though it will expand Novartis’ licensing of Schrodinger’s proprietary software.
Schrodinger is not new to the drug discovery scene. The company, headquartered at 1540 Broadway, has been developing molecules used in pharmaceuticals for more than 30 years. In the process, it has spun off companies including Nimbus Therapeutics and Morphic Therapeutics, the latter of which sold to Eli Lilly in August for $3.2 billion.
Novartis has been buying up oncology discovery projects in recent months. Last month the company and China-based biotech company Chengdu Baiyu Pharmaceuticals unveiled a $70 million deal for a candidate for cancer treatment that could net $1.1 billion in milestones for Chengdu. In May Novartis acquired Massachusetts-based Mariana Oncology for $1 billion upfront with the possibility of an additional $750 million in milestones. And in February it bought German pharmaceutical company MorphoSys AG for the equivalent of approximately $2.9 billion.
Founded in 1990, Schrodinger is a public company with approximately 900 employees across the U.S., including 360 at its New York headquarters. It brought in roughly $35 million in revenue in the third quarter of this year.
Novartis, meanwhile, is a global public firm with about 76,000 employees that generated $45.4 billion in net sales last year.
Gov. Kathy Hochul plans to revive congestion pricing for drivers entering large parts of Manhattan, months after abruptly pulling the plug on a $15 charge just before it was set to start, arguing it would have strained working families and small businesses.
Hochul is expected to announce the initiative on Thursday, this time with a $9 charge for most motorists driving into Manhattan’s central business district, according to people familiar with the plans.
President-elect Donald Trump opposes the plan and with his inauguration scheduled for Jan. 20, the governor has limited time to implement the new charge and avoid the incoming administration stalling the program, as it did during his first term. The $9 toll could bring in revenue that the Metropolitan Transportation Authority, which runs the city’s transit network, would borrow against to modernize a more than 100-year-old system.
“Gov. Hochul paused congestion pricing because a daily $15 toll was too much for hard-working New Yorkers in this economic climate,” Avi Small, a spokesperson for the governor, said in a statement. “Tomorrow, the governor will announce the path forward to fund mass transit, unclog our streets and improve public health by reducing air pollution.”
Pausing congestion pricing opened up a $15 billion deficit in the MTA’s current capital plan and deferred signal upgrades, subway renovations, accessibility projects and purchasing 250 electric buses. The MTA’s next five-year $65.4 billion capital budget is also at risk as nearly half of it is unfunded. The transit provider is seeking to rehabilitate aging structures after years of neglect and improve service to attract more riders to its system of subways, buses and commuter rail lines.
Hochul’s revised plan would initially slash the prior tolling structure by 40%, with E-ZPass motorists paying $9 rather than $15 to drive south of 60th Street during peak hours, according to the people familiar.
To begin the program, Hochul needs the federal government to approve the revised tolling structure and to also sign a value pricing pilot program agreement with New York. It’s doubtful the incoming administration would make those authorizations after Trump said he would terminate congestion pricing in his first week back in the White House.
If implemented, the toll would apply to motorists entering Manhattan’s central business district, which runs from 60th Street to the southern end of the island. New York City is the world’s most-congested urban area, according to INRIX, a traffic-data analysis firm.
The goal of congestion pricing is to reduce the number of the vehicles in the district by 17% and improve air quality. It may be difficult to hit those targets with a lower $9 toll because it may fail to persuade commuters and visitors to use public transportation rather than cars to get into Manhattan.
The City Council on Wednesday overwhelmingly passed a bill that bans tenants from being forced to pay broker fees when searching for apartments — the culmination of more than 18 months of effort to address one small part of an affordability crisis that has long burdened New Yorkers.
The legislation, the Fairness in Apartment Rentals (FARE) Act, was sponsored by 26-year-old Brooklyn lawmaker Chi Ossé, who has pushed the measure since 2023. Its historic passage, with 42 lawmakers in favor and 8 against, protects it from a potential veto from Mayor Eric Adams. He had not taken a formal stance on the bill until Tuesday, when he hinted at opposition and warned it could end up costing renters more.
Ossé celebrated the legislation's success, calling it a win for tenants who he said for too long have had to cough up exorbitant broker fees on top of their rent, even if the tenant never sought out the broker's services.
"Today we end that cruel and archaic practice. Today is a win for the people of New York as we make official what has long been common sense," Osse said during the vote.
Lawmakers' votes on the legislation — which states that any agent who advertises a rental home with the landlord's permission "shall not impose any fee" on the new tenant — were unsurprisingly split largely along party lines. All six Republicans in the 51-person legislative body voted against the bill, in addition to Brooklyn councilmembers Kalman Yeger and Susan Zhuang. One member was absent for the vote.
Its passage, however, dealt a blow to the real estate industry, which had fought against the measure in an effort led by the Real Estate Board of New York.
An initial version of the bill simply stated that whoever hires a broker must pay that person's fees, but it underwent several revisions in recent weeks and now explicitly bars brokers who are working on behalf of a property owner from charging fees to a tenant. Landlords and brokers must also disclose any fees related to a rental in advance, and give tenants itemized lists of those costs — with violations punishable by civil penalties of up to $2,000.
President-elect Donald Trump could jeopardize $7.9 billion in federal aid to New York City, posing “grave risks” to the city’s finances, Comptroller Brad Lander said.
The Democrat said his office had spent the days since last week’s presidential election conducting an assessment of fiscal risks the incoming Republican administration might present. The study, he said, is based on Trump’s campaign statements, actions taken during his first term and proposals outlined in Project 2025, the ultra-conservative policy blueprint that the Trump campaign has disavowed.
“America made a choice that is going to be felt in every corner of the world, including very much right here in New York City,” Lander, who is running for mayor in next year’s election, said at a press briefing on Wednesday.
New York receives $7.9 billion in federal aid each year, which accounts for 7% of the city’s $112 billion annual budget, Lander said. Nearly half of that goes toward education and early childhood programs, including $700 million for schools serving low-income students and $545 million that supports universal free breakfast and lunch programs for roughly 1 million public school students.
The $7.9 billion figure doesn’t include other federal aid and one-time capital funding infusions received by agencies like the Metropolitan Transportation Authority (a state agency), the City University of New York system and New York City Health and Hospitals, the entity that runs the city’s public hospital system.
Lander said his assessment is based in part on how Trump treated New York during his first term, when he repeatedly attempted to cut funding to non-defense discretionary programs, including education aid, public housing, food stamps and Medicaid. Shortly after taking office in 2017, Trump released a budget that would have slashed $190 million in federal aid for anti-terrorism and homeland security grants used by the New York Police Department.
Congress largely failed to approve those cuts, but shortly before he lost his reelection effort in 2020, Trump threatened to strip federal aid to what he called “anarchist jurisdictions” like New York and other Democratic-controlled cities where racial justice protests proliferated in the wake of the murder of George Floyd. That effort didn’t succeed.
The “most immediate and financially significant risk” Trump’s presidency poses, Lander said, is the possibility Trump could kill or significantly delay the implementation of congestion pricing, the city’s proposed first-in-the nation tolling program. It would have charged drivers $15 to enter or exit Manhattan below 60th Street, but the plan was paused in June by Gov. Kathy Hochul shortly before implementation. Trump is on record opposing the program.
The governor has refused to say whether she intends to revive it, most likely with a lower toll, before Trump takes office in January. Hochul hasn’t identified an alternative funding source to fill the $1 billion hole in the state’s budget left by pausing the program, and Trump is unlikely to give congestion pricing the final federal approvals the program needs.
Trump’s plan to implement new tariffs could also hurt the city economy by creating higher inflation and jeopardizing industries that rely heavily on imports, like fashion, Lander said. And more broadly, Trump’s threats to implement mass deportations of undocumented immigrants could have an outsize impact on the city’s economy, which depends on immigration for population growth and labor.
Lander did identify at least some potential positive benefits to the city’s economy from the second Trump presidency: For example, New York could become more attractive to high-income residents if the administration were to lift the cap on deductions for state and local taxes, known as SALT, which was imposed in the 2017 tax law.
And extending alternative minimum tax provisions enacted under the same tax law could also benefit high earners, improving the city’s competitiveness, according to the comptroller.
A spokesperson for the Trump campaign didn’t immediately respond to a request for comment.
What does it mean to be a Whole Health Hero? For the past five years, the Anthem Blue Cross and Blue Shield Whole Health Heroes Awards have answered that question by honoring a cohort of exemplary individuals who have helped advance the health of all New Yorkers. The 2024 winners, who were honored at a luncheon hosted by Crain’s Content Studio and Anthem on Oct. 17, continue that tradition.
"Our honorees have shown leadership, innovation, and compassion in tackling some of the biggest health challenges of our time,” said Frederick P. Gabriel, publisher of Crain’s New York Business at the event held at the Manhattan Penthouse. “These honorees come from very different professions, from advancing medical research to supporting our most vulnerable communities. Yet despite their different paths, they share a common goal: making New York a healthier place to live.”
Mark Miller, general manager of Anthem Blue Cross and Blue Shield in New York, told the honorees that they exemplify “what we can accomplish together to improve the health of New Yorkers through collaboration, having an innovative spirit, and working together.”
Deborah Ruggiero, clinical programs director for Anthem Blue Cross and Blue Shield stressed the insurer’s focus on whole health, technology, and advocacy. Wellness, she said, is pervasive across “all dimensions of life.” She challenged the audience to create “messaging to the masses” that defines wellness with an equal emphasis on physical, behavioral, and social factors. That means providers need to ask the right questions: Do you have access to healthy food? Do you need workforce development opportunities? What else is going on in your life?
While technology can create better access to health data, it can also lead to information overload, Ruggiero said. “Our challenge right now is to continue to develop tools and strategies to help people find the balance of taking advantage of all that great technology, but also managing it in a way that doesn't create more stress.”
After lunch, three of the 2024 honorees participated in a panel discussion, “Innovation in Health: Shaping the Future of Wellness,” led by moderator Victor DeStefano, president of the New York commercial business at Anthem Blue Cross and Blue Shield. The panelists spoke about their individual approaches to whole health and the promise—and limitations of technology.
Clinical psychologist Jonathan M. DePierro, associate director of the Center for Stress, Resilience and Personal Growth at Mount Sinai said his center aims to improve the resilience and behavioral health of the health system’s 45,000 employees through access to educational programs on mental health awareness and mental health therapy, both virtual and in-person.
Jada Shapiro, the founder and CEO of Boober, runs a marketplace for expectant parents and new families to help them manage pregnancy and birth, including access to doulas, lactation consultants, and mental health therapists. She started Boober because of a gap she perceived in the health care system in the U.S., where there’s little follow-up after a mother gives birth. “People are left on their own at this point to find the care they need to actually thrive,” Shapiro said.
Eric Feinstein, president and CEO of Clarapath, a robotics company that provides an automated solution to process biopsy slides, said cancer patients often wait weeks for critical biopsy results, adding to their stress and anxiety. “Unfortunately, in the great state of New York, there are about 247 histotechnologists in the entire state of 20 million people,” Feinstein noted. “To say we are in a full-scale crisis is an understatement,” Feinstein noted.
Responding to DeStefano’s question about the role of AI in health care, Feinstein cautioned that while health care has an abundance of data, it’s not always good, clean data or the right data. “So, for AI in particular, if you have garbage coming in, you’ll get garbage coming out,” Feinstein said. “I think the biggest drivers of innovation over the next three, five years and for all the aspiring entrepreneurs is putting these technological pieces together and identifying what is the root cause of the problem.”
Shapiro spoke about the importance of caring for the whole person and not just focusing on the clinical aspects of pregnancy and birth. Although technology can sometimes be critical to saving lives during childbirth, she said that its overuse can also lead to excessive routine intervention that doesn’t take the individual’s needs into account.
DePierro said that the Center for Resilience is focusing on expanding access and fighting stigma. This month, the center will offer its services to people in the community, particularly first responders and other health care workers with a qualifying insurance plan. Mental health campaigns featuring patient testimonials will aim to reduce the stigma of receiving mental health care. They also plan to leverage technology, including a new app under development to help people build resilience and wellness.
Anthem’s DeStefano ended the session by offering his thanks to the panelists and all the Whole Health heroes. “We recognize that 80% of health happens outside of the doctor’s office, and you are the reason we have a bright future in healthcare.” 1
New landlords have taken over a 20-story luxury apartment building on the Upper East Side, city records show.
Los Angeles-based CIM Group offloaded the 150-unit rental tower, dubbed the Hanley, at 165 E. 66th St. to private-equity giant Carlyle Group for $128 million, according to a deed that appeared in the city register Tuesday. The sale comes as a loss for CIM Group, which bought the property between Third and Lexington avenues, for $200 million in 2019, according to city records.
Wonjoong Kim, managing director at the Carlyle Group, signed the papers on behalf of the buyer, which made the purchase with the help of a $118 million loan from Midtown-based Acore Capital, records show.
The Carlyle Group, which is headquartered in Washington, D.C., and has recently been scooping up a bunch of self-storage facilities across Brooklyn, acquired both the residential and garage portions of the building, records show. There are currently no available units in the building, where a 618-square-foot studio rented for $4,300 in June, according to StreetEasy. The ground-floor retail unit, however, has a different owner, Miami-based real estate firm Crescent Heights, according to city documents, and was not part of the sale. It is currently occupied by the clothing store Alo.
It appears the Carlyle Group did not make the massive purchase alone but, rather, in partnership with real estate company Stonehenge NYC, according to Carlyle's website, which lists the Hanley as one of the residential buildings in the city that make up its $2.5 billion portfolio across 3.5 million square feet of property.
The purchase is more in line with Carlyle's heavily residential portfolio, though it recently acquired three self-storage sites in Brooklyn for more than $60 million, Crain's reported during the summer. Led by CEO Harvey Schwartz, the Carlyle Group last February bought the Aire, a luxurious but financially ailing rental building on the Upper West Side, for $265 million in partnership with developer Gotham Organization, Crain's reported at the time.
Neither the Carlyle Group nor Stonehenge NYC responded to a request for comment, and it is unclear how much of a stake each firm has in 165 E. 66th. The seller, CIM Group, which has $28.6 billion in total assets, according to its website, declined to comment.
Leases
Japanese-Italian eatery opens in former WeWork cafe in NoMad
Address: 902 Broadway, Manhattan
Landlord: Rosen Equities
Tenant: Aqua New York
Lease size: 24,000 square feet
Asset type: Retail
Broker: Max Koeppel represented the landlord in-house.
Intellectual property law firm extends lease in Midtown
Address: 589 Eighth Ave., Manhattan
Landlord: GFP Real Estate
Tenant: Davidson Kappel
Lease size: 3,000 square feet
Lease length: 5 years and 6 months
Asset type: Office
Brokers: Alan Steinberg and Neil Joffee represented the landlord in-house and the tenant.
Sales
CIM Group offloads Hanley rental on Upper East Side
Address: 165 E. 66th St., Manhattan
Seller: CIM Group
Buyers: Carlyle Group and Stonehenge NYC
Sale price: $128 million
Asset type: Multifamily
Financings
Acacia Network refinances Jamaica mental health center
Address: 116-30 Sutphin Blvd, Queens
Owner: Lymaris Albors
Lender: Dormitory Authority of the State of New York
Loan amount: $30.1 million
Asset type: Retail
Michael Kors effectively cut its rent in half while expanding its location at 667 Madison Ave., becoming the latest big retailer in the Plaza District to land a bargain.
The footprint of the Kors store will nearly double to 11,000 square feet under a lease that took effect in August. But the monthly rent bill didn’t change much. As a result the luxury fashion house is paying $438 per square foot, a 49% markdown from the prior rate of $862, credit-rating agency KBRA said in a report last week. The new lease continues through 2034.
“It’s pretty close to the same total rent as before, but the space is bigger,” said Phil Patton, general counsel at 667 Madison’s owner, Hartz Mountain Industries.
Prominent retailers have extracted steep discounts from Midtown landlords this year. Sephora, which is owned by French luxury giant LVMH, negotiated a 66% reduction in the rent for space at Tishman Speyer-owned 520 Madison Ave. Club Monaco this year signed an extension for space at 597 Fifth Ave. at an 80% discount to the pre-pandemic rate for the area.
Like many luxury brands, Michael Kors is having a challenging year. Revenues declined by 16% last quarter, London-based owner Capri Holdings Ltd. said last week, citing “softening demand globally for fashion luxury goods.” Capri, which also owns Versace and Jimmy Choo, didn’t return an email seeking comment.
There are fewer empty storefronts in the Plaza District, but space remains plentiful. The availability rate along Madison between East 57th and East 72nd streets declined to 14% last quarter from 19% a year ago, Cushman & Wakefield said.
667 Madison is a 25-story, 275,000 square-foot Class A tower at the corner of East 61st Street. It was developed in 1985 by Leonard Stern, CEO of Hartz Mountain, which owns 38 million square feet of space in New York, New Jersey and other places.
“667 Madison is a great building, I wish I had more like it,” Stern told Crain’s.
But the rents it can charge for retail space have declined by 36% since 2016, S&P Global said in August. Although the property is on track to reach 84% occupancy by year-end, up from 80% in April, S&P said net cash flow likely won’t return to historical levels.
“This is generally due to in-place gross rents per square foot that are, on average, below our expectations,” the credit-rating firm said when it downgraded a security, formerly rated AAA, that holds 667 Madison’s mortgage.
KBRA cited Michael Kors’s lower rent as a reason it considers 667 Madison’s mortgage a “loan of concern.” Net cash flow fell by 64% at the property last year, KBRA said. Loews Corp., the insurance, energy, and hotel conglomerate, moved out and relocated to 9 W. 57th St. Stern said the Tisch-controlled company outgrew his building and its space was filled by another tenant. Office rents at 667 Madison have fallen by only 4% since 2016, S&P said.
Stern told Crain’s if there’s any difficulty refinancing when the $254 million mortgage comes due in 2026, he is prepared to pay off the loan and continue holding the building. Stern’s fortune is $9 billion, according to Forbes. New York University’s business school is named for him.
For 15 years, Locanda Verde has stuck to its cozy location on a quintessential Tribeca corner. The owners have withstood innumerable offers to expand while staying busy feeding regulars in the high-rent neighborhood, including David Solomon, chief executive officer of Goldman Sachs Group Inc.
But on Nov. 15, the landmark downtown restaurant will open a second location on the ground floors of 50 Hudson Yards. The building is the corporate headquarters for the investment firm BlackRock; Meta Platforms has 22 floors there as well.
Chef Andrew Carmellini, co-founder of NoHo Hospitality, which owns Locanda Verde, says his priority was for the restaurant not to feel like it’s in an office building — no small feat in a 78-story tower with 2.9 million square feet of office space.
De Niro’s vision
On a tour of the new Locanda Verde with Carmellini earlier this fall, the space indeed manifests a neighborhood vibe, even on a busy 34th Street corner among the surrounding skyscrapers. When you walk inside, there’s a golden glow, with wood shutters covering the windows and dark burled mahogany wall panels upping the coziness factor; the shaded metal chandeliers aren’t too splashy. A long green marble bar with a dozen seats anchors space near the entrance. Surrounding it is a mix of banquettes and inlayed tables with chairs covered in handsome green-and-white-striped fabric or leather. An unassuming staircase leads up to more seating. It’s not an exact facsimile of the downtown Locanda but it feels familiar.
Carmellini says the corner location is key: It simultaneously helps make the spot feel more lively and like a destination. Another non-negotiable feature was outdoor seating, which will begin in the spring. It was a stipulation of a Locanda Verde partner: actor Robert De Niro. “When I first met Bob in 2008, there were only two things important to him: to have his dad’s art on the wall and that the restaurant spilled onto the street,” Carmellini says. “He wanted a good neighborhood feel to it.”
Bruce A. Beal Jr., president of Related, a primary equity partner behind the $25 billion Hudson Yards development, says the restaurant also had to reflect the city. “As a developer we do our best to give people what they want. We kept hearing from tenants that we want more local restaurateurs who know and understand New Yorkers.” The original Locanda Verde is his local. “I live down in Tribeca, so I’ve been a frequent visitor for 15 years.”
Beal consulted with the tenants before signing up NoHo. “We’re in the service business — we don’t forget our customers,” he notes. “Food and beverage is a big part of that culture. We sat down with Rob [Goldstein, BlackRock’s chief operating officer] and went through the food options.” It wasn’t, Beal adds, an “‘If we build it they will come’ mentality.”
The overall goal, says Beal, was to open a “significant” dining spot. “It's a $10 million-plus investment to open a restaurant like this. And it's in the most valuable building that’s been built in the US, a $6 billion-plus building.”
“In Manhattan, restaurants say a lot about a neighborhood and say a lot about the eco system of a neighborhood,” says Goldstein. “Personally and professionally at BlackRock we are focused on building relationships. And when we think of the proverbial ‘let’s sketch it out on the back of a napkin,’ those napkins are at restaurants.” He too lives in Tribeca and frequents Locanda. Dining rooms like that are, he adds, “places where you break bread and conceive what’s possible.”
The food, the drinks
The menu at the Midtown Locanda Verde will be stocked with staples from the flagship, including the lamb meatball sliders and My Grandmother’s ravioli, stuffed with a combo of short rib, veal and pork and bathed in tomato sauce with a handful of grated Parmesan added. Carmellini will also introduce a crudo of live sea scallops with nduja, an Italian sausage. Among other new dishes are a green Caesar topped with anchovy crouton crumble; chitarra nero, noodles in the shape of guitar strings, here made black with squid ink and sauced with hot buttered crab and Calabrian chilies; and a lasagna verde stocked with a creamy, meaty ragu blanco and pink peppercorns. The prices will be the same as downtown, says the chef. The chef's signature roast garlic chicken for two, a favorite of BlackRock’s Goldstein, is $39 for one and $78 for two both uptown and downtown.
The 700-bottle wine list is rooted in Italy, including heavy hitters from Barolo and Barbaresco and labels from progressive producers in regions like Friuli and Sicily. Foreseeing the possibility of diners with big budgets, Josh Nadel, director of beverage, says there will be “a lot of verticality” (bottles from consecutive vintages) going back to the 1970s, from big-deal winemakers like Bruno Giacosa and Bartolo Mascarello. There will also be non-Italian bottles from places including Burgundy and Champagne: “Some categories transcend cuisine and are always in demand,” Nadel says.
Over in the cocktail department, Daryl Chan has designed a drinks program of tweaked classics with Italian accents. On the menu: A bittersweet cappelletti fizz aperitivo with gin, egg white and fennel pollen; the P&T, a seasonal gin and tonic with a splash of pear-vanilla liqueur; and the palomarita a tequila-based mash up of a paloma and margarita.
The 165-seat space was designed by Roman & Williams, who, along with including framed art from Robert De Niro Sr., have installed large earth-toned hand-painted murals. The seats are equally divided between upstairs and downstairs: There are 75 on the ground floor and 73 above, where the vibe is more intimate, and there’s a separate bar and a 28-person private dining room, as well as plenty of windows overlooking a park. (Given a choice, ask for an upstairs table.)
A quarter-billion dollars in restaurant revenue
Despite the failures around the first launches of restaurants at Hudson Yards — Thomas Keller’s vaunted TAP Room was among the dining rooms that closed as a result of the pandemic — Carmellini thinks his team can re-create the demand they see downtown. “I 100% think we can achieve that here. It’s an interesting neighborhood. We have Bar Primi down the street, and it’s very busy always.”
Beal sees Locanda as a foundational part of the burgeoning and profitable food and drink scene at Hudson Yards. Coming in the next year are an outpost of Eataly at 20 Hudson Yards and dining spots from local star chef Gabriel Kreuther and a Los Tacos No. 1. There’s also talk about bringing in a notable New York pizza slice shop into the fold. “We have close to a quarter-billion dollars in revenue coming in from all our restaurants close to a year from now,” he says. “We’re a destination now.”
Shares in Queens-based JetBlue were soaring by about 16% in early trading today as shares in competitor Spirit Airlines tumbled following reports the ultra-low-cost carrier is preparing to file for bankruptcy protection.
The Wall Street Journal reported late Tuesday that the bankruptcy talks at the Florida-based budget airline come in the wake of a failed merger with Frontier Airlines. In pre-market trading Spirit’s stock sank by nearly 65% to $1.14 per share, but after markets opened rebounded slightly to trade down about 56% at $1.42 per share.
The debt-ridden airline has been on the back foot since regulators blocked its $3.8 billion merger deal with JetBlue Airways in January. Spirit was set to merge with Frontier in 2022 when JetBlue came in with a higher offer that won over Spirit’s investors. But the deal fell through when a federal judge ruled that the merger would be detrimental to competition and blocked JetBlue from acquiring the company.
Spirit has struggled since. The company’s stock has lost more than 90% of its value so far this year.
On Wednesday the speculation about Spirit’s insolvency sent rival and would-be partner JetBlue’s stock rallying Wednesday morning. The stock was trading recently at around $7.26. Other airlines rose as well in anticipation that a Spirit bankruptcy could send its customers to other carriers and constrain supply, boosting fares.
Spirit operates flights out of coveted gates at the region’s three major airports — LaGuardia Airport, John F. Kennedy International Airport and Newark Liberty International Airport — and is sure to have airlines circling for the lucrative airport space if those spaces become available.
Mayor Eric Adams called the U.S. immigration system broken and said he’d reach out to Donald Trump’s incoming administration with suggestions as the president-elect’s policy agenda takes shape.
“I believe we can be helpful,” Adams said in a press conference Tuesday, adding “no one has gone through” what his own administration has gone through, with more than 200,000 migrants arriving in the city in the last two years. “Voters said, ‘This is a problem.’”
While Adams emphasized that he’s against the types of mass deportation that Trump and his surrogates advocated during the presidential campaign, he said City Council members should change local rules to allow for more coordination with the U.S. Immigration and Customs Enforcement agency when it comes to criminal cases.
Newcomers should be treated “humanely,” Adams told reporters. But he added that “people who are repeat offenders of violent acts, after they serve their time, they should not remain in our city.”
The law currently allows the city to cooperate with ICE detainer requests in cases of individuals who have been convicted of certain violent or serious crimes or are identified as a possible match in the terrorist screening database. The NYPD has said it “does not facilitate the transfer of such persons” to the custody of federal authorities and also doesn’t track the immigration status of people in its custody.
One suggestion for Trump from the mayor: Migrants paroled ahead of asylum hearings should be ordered to wait in parts of the country in need of workers, instead of allowing the migrants to concentrate in just a few cities.
“If you parole into this country, you should be told where you’re going,” he said.
He also reiterated his plea for the federal government to expedite work authorizations for asylum seekers.
As of 2022 there were more than 400,000 undocumented immigrants estimated to be in New York City. Adams emphasized in a press conference after the presidential election last week that he intends to protect them, while Immigrant Affairs Commissioner Manuel Castro sought to reassure migrant communities about the city’s sanctuary laws.
“I want to reassure people that they do not need to self-deport, they do not need to hide,” Castro said Nov. 6. “They can continue to use our city services, especially emergency services, like our Police Department, our hospitals, and so on.”
For two years, Adams warned that the recent influx of migrants — many of whom were bused from the Texas border — could “destroy” New York, repeatedly blaming President Joe Biden’s administration for its failure to manage the crisis and provide cities with the necessary aid to cushion the fiscal blow. Adams threatened drastic budget cuts to city services, trash pickup, library hours and police classes. He’s since reversed those curbs as the number of migrants in the city’s care stabilized and city tax revenue came in much higher than anticipated.
While Trump’s dire warnings about crimes committed by undocumented immigrants were a centerpiece of his presidential campaign, migrants commit crimes at a lower rate than the U.S.-born population, according to the Migration Policy Institute. Some studies even indicate that immigration can lower crime when the migrant population becomes well established.
New York has been home to the most immigrants between 2018 and 2022, according to the MPI. Yet the city had the fifth-lowest homicide rate among the 50 largest cities in 2023, police statistics show.
Trump announced Monday that he would install Tom Homan, the former acting head of ICE, as a “border czar.” While Trump’s transition team hasn’t provided details on deportation plans, Homan said in an interview on Fox News that “public safety threats and national security threats” will be the priority.
“We’re going to do the job, without you or with you,” Homan said in a warning to local officials.
New York cannabis regulators unveiled sweeping changes across multiple industry sectors, approving 125 new business licenses while introducing payment flexibility for medical operators and extending deadlines for social equity retailers.
The state’s Cannabis Control Board on Tuesday approved:
- 42 retail dispensaries
- 30 microbusinesses
- 6 cultivators
- 11 distributors
- 36 processors
Regulators said there are now 230 dispensaries operational across New York, and 1,311 total licenses have been issued thus far this year.
License extension
Regulators also extended provisional licenses for conditional adult-use retail dispensary (CAURD) operators by six months. Hundreds of those licenses had been set to expire in the next two months, as recipients struggled to get their stores operational in time.
The Office of Cannabis Management also clarified what it meant for these operators to be “operational.”
“This does not necessarily mean that a CAURD (licensee) needs to have its doors open within six months, but they do need to have their final license issued in order for the provisional license not to expire,” said Chief Licensing Officer Patrick McKeage. “Some of the aspects of getting your actual dispensary opening, like going through the municipal hurdles or doing a build out of your location, some of those can just take time that’s not necessarily in the licensee’s control.”
The extension follows a $2 million loan fund launched by New York City in October offering low-interest loans up to $100,000 for eligible social equity retailers.
Of the original 904 CAURD applications submitted in September 2022, McKeage reported that 543 received provisional licenses, while 359 were denied, withdrawn or administratively closed. Only 217 have received final approval.
Read the full story at Green Market Report.
Gov. Kathy Hochul is looking to revive congestion pricing with reduced tolls before President-elect Donald Trump has a chance to kill the program, albeit with a lower charge that likely would diminish the plan’s impact on easing Manhattan traffic.
The governor is in talks with federal transit officials about implementing congestion pricing with a $9 peak toll — down from a previously planned $15 — and if such a change could require lengthy approvals, according to two people familiar with the matter. Politico first reported the discussions. State law requires that congestion pricing generate enough annual revenue for the Metropolitan Transportation Authority to finance $15 billion in mass transit upgrades. Economist and traffic modeler Charles Komanoff modeled the change and found the $9 peak toll could hit that mandate, but at the cost of taking less street-clogging vehicles off the road.
Transit officials have long anticipated congestion tolls could curb car traffic to the district by about 17% — thereby making it easier for drivers and trucks carrying goods that must utilize the road to navigate Manhattan’s busiest streets. New modeling by Komanoff determined that simply tweaking the peak toll to $9 would generate the $1 billion in annual revenue needed for the MTA to borrow against. The downside is the lower peak toll would only initially improve traffic speeds south of 60th Street by 6.4% and rise to a 12.4% enhancement once expected street improvements are implemented as part of the program, according to Komanoff.
“The traffic improvement just starts getting really small,” said Komanoff. “It’s a poor man’s version of congestion pricing and, yes, it’s better than nothing, but it’s not as good as just flipping the switch on the $15 toll.”
Hochul’s administration is approaching congestion pricing with renewed urgency in light of Trump's imminent return to the White House. The president-elect vowed in May on his Truth Social platform that he’d “TERMINATE Congestion Pricing in my FIRST WEEK back in Office!!”
Hochul told reporters at the Somos conference Friday that she is working to “develop a plan that will deal with congestion mitigation, deal with environmental protections, but also be sensitive that times are tough for people in our city and the surrounding areas.”
A $9 peak toll scenario is one the MTA actually received federal approval for after transit officials spent years studying an array of options. However, that scenario did not include certain toll credits and discounts that the MTA’s Traffic Mobility Review Board recommended and that the authority’s board adopted. Additional tweaks would trigger new reviews by state and federal transit officials. How lengthy those turn out to be depends on Hochul’s formal proposal. Trump’s inauguration is in just 68 days.
The governor is also looking into gradually increasing the peak toll, starting at $9 and eventually reaching $15, according to two people familiar with the discussions. Whatever the governor settles on, she has an incredibly narrow window of opportunity. Transportation advocates say so long as the governor acts quickly they are hopeful congestion pricing can go live before Jan. 20.
“The clock is ticking,” said Lisa Daglian, executive director of the Permanent Citizens Advisory Committee to the MTA. “We’re between a rock and a hard place and there’s a giant boulder looming on top of us.”
The largest credit unions in the New York area barely saw an increase in total assets since last year. The 25 credit unions on Crain’s inaugural list, ranked by assets as of June 30, saw average growth of less than 1% from June 2023 to June 2024.
Membership among these organizations likewise saw minimal growth, averaging a 1% increase since 2023. according to data from the National Credit Union Administration.
Bethpage Federal Credit Union claims the No. 1 spot with $12.9 billion in total assets, down 1.1% from last year. The credit union currently has a little over 473,700 members, up nearly 4% from last year, and $9.6 billion in total loans.
Teachers Federal Credit Union follows with $9.8 billion in total assets, up almost 2%, and nearly 470,000 members, up 1.4%. The credit union has $6.3 billion in total loans and is the largest employer on the list with about 870 workers.
And United Nations Federal Credit Union ranks No. 3, reporting the greatest uptick in assets and membership on the list. The credit union saw over an 11% increase in total assets, up to $9.4 billion, and a 10.4% increase in membership, up to nearly 240,000 members.
Combined, these 25 credit unions have $58.6 billion in total assets, 2.8 million members, $38.6 billion in total loans and more than 5,400 employees.
Access the full list — as well as a downloadable version of the information our researchers collected about these companies — in our Data Center. The Data Center requires an All Access subscription. If you'd like to change your subscription, please contact customer service at 877-824-9379 or customerservice@crainsnewyork.com.
The City Council on Wednesday is set to pass a bill that bans tenants from being forced to pay broker fees when searching for apartments — marking a huge and long-sought change to the city’s rental market and a defeat for the real estate industry, which fought against the measure.
The only question ahead of Wednesday afternoon’s vote on the Fairness in Apartment Rentals (FARE) Act is whether it passes with the necessary 34 votes to overcome a potential veto from Mayor Eric Adams, who criticized it on Tuesday. As of Tuesday afternoon, 32 members of the 51-person council had signed onto the bill, which is sponsored by 26-year-old Brooklyn lawmaker Chi Ossé.
The legislation states that any agent who advertises a rental home with the landlord’s permission “shall not impose any fee” on the tenant who rents it. That would mark a sea change from the current system, widely loathed by renters, in which brokers can charge an unlimited fee — often about 15% of a year’s rent — even if the tenant never sought out the broker’s services.
“I started writing the bill over a year ago, when I was searching for a new apartment and I learned how expensive finding a new place can be,” Ossé said in a video message on Tuesday. “Forced broker fees have been hurting our city since anyone can remember.”
Led by the Real Estate Board of New York, brokers have vigorously opposed the bill, arguing it would disrupt the market, deter brokers from listing apartments, and ultimately increase rents by compelling landlords to pass on the fees to tenants.
“The latest iteration of the FARE Act will lead to disastrous results for tenants, brokers, and owners alike,” REBNY wrote in a memo about the current version of the bill. The group has not ruled out a potential lawsuit to block the bill from becoming law.
Mayor Eric Adams has not taken a formal stance on the bill but hinted at opposition on Tuesday, telling reporters that he worried renters would end up paying higher costs. By moving to pass the bill over Adams’ objections, the council is exercising the significant leverage it enjoys over the embattled mayor, who has limited ability to fight against the popular measure. (A June poll by Tusk Philanthropies found the bill had 66% support among registered Democrats.)
Ossé has pushed the legislation since 2023. While an initial version simply stated that whoever hires a broker must pay that person’s fees, the bill underwent revisions in recent weeks and now explicitly bars brokers who are working on behalf of a property owner from charging fees to a tenant. Landlords and brokers must also disclose any fees related to a rental in advance, and give tenants itemized lists of those costs — with violations punishable with civil penalties of up to $2,000.
The average up-front cost for an apartment with a broker fee is $12,951 in 2024, according to data provided by the rental platform StreetEasy. But so-called “no-fee” apartments tend to have higher rents than apartments with broker fees, a fact that REBNY has cited as evidence that the FARE Act will ultimately raise rents. Ossé and his allies counter that rent is dictated by broader market forces and note that half the city’s housing stock is rent-stabilized and cannot be subject to steep hikes.
REBNY has focused much of its recent criticism on the current language of the bill, which creates a “rebuttable presumption” that any broker who publishes a listing for a home has done so with the permission of the landlord. In reality, REBNY argues, about half of the city’s apartment listings are posted by brokers who received a “right to advertise” the unit but are not working directly for the landlord.
If the bill passes, brokers would be deterred from posting those listings since they could not collect a fee, resulting in fewer homes on the market and less transparency for tenants, REBNY argues. The industry group has proposed its own bill that would instead give tenants a “bill of rights” informing them about fees in advance, but the measure has not been taken up by the council.
New York and Boston are unique among U.S. cities for leaving tenants on the hook for broker fees. City and state leaders have failed in multiple past attempts to curb broker fees in New York, each time running up against the powerful force of REBNY.
The City Council considered a bill in 2019 that would have capped the fees at one month’s rent, but it stalled after brokers packed City Hall to oppose it. And state regulators banned the fees outright in 2020, only for that policy to be overturned following a lawsuit by REBNY.
Ossé’s bill stalled last year on its first attempt, but gained momentum this year with the apparent blessing of Council Speaker Adrienne Adams. It continued advancing even after a show of force in June, when REBNY and firms like Brown Harris Stevens and Corcoran dispatched hundreds of brokers to rail against the bill at a City Hall hearing — where they were met by another large crowd of young renters who spoke out in favor of the bill after watching Ossé’s popular social media videos.
REBNY has continued its opposition campaign since then, most recently by placing advertisements on the roofs of 750 taxis, stating that “Our City Council wants to make it even harder to find an apartment in NYC.” If its push fails, it would mark a major setback for the real estate lobby, and come a few months after a state-level housing deal that left some developers dissatisfied.
Mayor Adams, discussing the broker bill on Tuesday, said he wanted to avoid a “knee-jerk reaction” to the city’s affordability crisis.
“I think the bill has the right intention, but sometimes good intentions do not get the results you're looking for,” he said.
ANTITRUST LAWSUIT: New York Attorney General Letitia James joined a lawsuit seeking to block the merger of two of the nation’s largest home health and hospice providers. The Department of Justice and four state attorneys general, including James, filed the suit against UnitedHealth Group and Amedisys Inc. alleging the merger would violate antitrust laws. UnitedHealth Group are top competitors across the country, including in parts of upstate New York, according to the attorney general’s office. The lawsuit also seeks $13 million in civil penalties for Amedisys’ failure to provide requested documentation as part of the merger application.
CARDIAC LABS: Huntington Hospital unveiled the fruits of a $5 million renovation of its two cardiac catheterization labs on Tuesday. In addition to the 1,200 of upgraded lab space, the project also included a nine-bed suite for pre- and post-op patients. The new lab equipment will help speed up diagnoses, said Dr. Gaurav Rao director of interventional cardiology at Huntington, a branch of Northwell Health. The technology, which is used to diagnose coronary microvascular dysfunction and coronary spasm, was paid for through an anonymous donation.
The 53 honorees on our list of Notable Leaders in Health Care work tirelessly across the industry to ensure the wellbeing of New Yorkers and the city overall. Here are five leaders that serve the city's hospitals, insurance companies and social services safety-net. Read the full list here.
Innocent Clement, Chief executive officer and founder, Ciba HealthScope of work: As the chief executive officer and founder of Ciba Health, Innocent Clement oversees a pioneering health care technology company dedicated to preventing and reversing chronic diseases through digital health solutions. Under his leadership, the company has grown to a team of 63 employees and health providers focused on developing and implementing personalized health programs.
Biggest career win: Clement launched and expanded Ciba Health’s Type 2 Diabetes Reversal Program, a holistic approach for treating diabetes through personalized care and a dedicated provider team. This program has achieved a 93% chronic disease reversal rate.
Other contributions: Clement sits on the board of directors for the CUNY Graduate School of Public Health and Health Policy Foundation.
Jon Cohen, Chief executive officer and director, TalkspaceScope of work: Jon Cohen, a physician, serves as chief executive officer and director of the online therapy platform Talkspace. He oversees strategic direction and operational management and is responsible for leading day-to-day operations and steering company growth.
Biggest career win: Cohen forged partnerships with organizations such as NYC Teenspace and Baltimore County Public Schools to help combat the youth mental health crisis by providing free therapy. Under his leadership, Talkspace now accepts Medicare, offering therapy to 13 million members.
Other contributions: Cohen has served as a senior advisor to New York Governor David A. Paterson, responsible for policy and strategic planning. He continues to educate and speak on health care accessibility and related topics.
Winifred Cudjoe, Chief operations and management officer, Ronald McDonald House New YorkScope of work: As chief operations and management officer at Ronald McDonald House New York, Winifred Cudjoe helps her organization provide a haven for families battling cancer and other serious illnesses. Leading a team of 32, she oversees programs that support the housing, reservation, guest services and family support needs for families and their children.
Biggest career win: Cudjoe led the development and construction of two Family Room programs, which will offer respite spaces and overnight sleeping rooms for caregivers.
Other contributions: Through her nearly 35 years with the organization, Cudjoe’s efforts have been based on the relationships she’s made with other local organizations, as well as partners across the country.
Glen Davis, Chief medical officer, Institute for Community LivingScope of work: Glen Davis is chief medical officer of the Institute for Community Living, one of New York City’s largest nonprofit behavioral health organizations. He oversees all clinical operations, leading the agency in providing person-centered care for more than 13,000 individuals across 140 programs annually.
Biggest career win: From 2015 to 2022, Davis led an opioid overdose prevention program where he trained more than 3,300 individuals on opioid overdose response and distributed 4,800 naloxone kits within the community.
Other contributions: Davis’ commitment to public service was shaped by his experience volunteering for two years at a primary care clinic in rural Burkina Faso with the U.S. Peace Corps.
Amy Divaraniya, Chief executive officer and founder, OovaScope of work: Amy Divaraniya is chief executive officer and founder of Oova, a women’s health platform known for its physician-backed fertility and perimenopause at-home hormone monitoring. She oversees the development and implementation of at-home hormone kits, ensuring they meet high standards of accuracy and usability.
Biggest career win: Under Divaraniya’s leadership, Oova has tracked more than 15,000 menstrual cycles, providing important data that has advanced the field of women’s health. The platform’s artificial intelligence-powered data analytics offer personalized results with a 95% correlation to blood tests, making it a trusted tool for both users and clinicians.
Other contributions: Divaraniya serves on the advisory board of Paterna, a male infertility organization, and speaks at conferences.
A brush fire east of Penn Station has spurred power outages for Amtrak trains running to and from New Haven, Connecticut, prompting lengthy delays for passengers.
The agency announced Tuesday that trains approaching Penn Station are being moved out of the area using diesel-powered engines. All service between New York Penn Station and New Haven is suspended for the remainder of the day, while trains between Boston South Station and New Haven are operating at limited capacity, according to the statement.
Firefighters are currently on the scene to mitigate the issue, but there’s no estimate for when service will resume. Customers traveling between New York and New Haven are encouraged to use Metro-North trains from Grand Central Station.
Brush fires have become more common in New York and New Jersey after months of parched conditions across the Northeast brought on the worst drought in more than two decades. Earlier this month, firefighters worked to extinguish a blaze in Brooklyn’s Prospect Park, an indication of just how dry this fall has been in New York City.
It’s yet another hiccup in train operations along the Northeast Corridor, the busiest stretch of rail in the U.S. The agency is waiving charges for customers looking to change their reservation, according to the Amtrak statement.
New York has chosen two dozen financial middlemen firms to help a large private company take over its billowing Medicaid-funded home care program.
The state has approved 24 existing home care companies to continue administering the Consumer Directed Personal Assistance Program or CDPAP, which allows family members and friends to get paid by the state for providing home care to their loved ones. The move, announced by Gov. Kathy Hochul on Tuesday, comes less than two months before the state embarks on a controversial home care overhaul that will eliminate the more than 600 middlemen that currently manage payroll and other administrative functions on the state’s behalf.
The newly selected firms will subcontract with Public Partnerships LLC, also known as PPL, which won a state contract last month to take over the home care program. The contract has yet to be finalized, but PPL will lead the transition and is expected to manage all payments to its subcontractors and home health aides, according to Sam Spokony, a spokesman for the governor’s office.
The state plans to finalize its contract with PPL by the end of this year, Spokony said. The governor’s office did not answer a question about how much it will pay PPL.
More than half of the chosen subcontractors have offices in and around the city, including All-Metro Health Care, ElderCare and the New York Foundation for Senior Services. The two-dozen agencies operate 100 offices statewide and serve all 62 counties in New York, the governor’s office said.
Hochul has pushed forward with a plan to cut back administrative expenses for CDPAP, which cost the state more than $9 billion last year while advocates and businesses who currently operate the program, also known as fiscal intermediaries, have staunchly opposed the change, arguing that it will upend care for at least 250,000 New Yorkers.
As a compromise, state lawmakers pushed to include subcontractors to allow some existing middlemen companies to stay in business and preserve an array of providers for consumers to choose from. PPL has vowed to work with four regional agencies, which it announced last month, and a network of roughly 30 subcontractors to provide specialized home care services and communicate with consumers in different languages. The newly selected agencies offer services in 21 languages including Chinese, Arabic, Haitian Creole and Polish.
Despite these changes, the home care industry has still pushed back on the state’s plan, arguing that PPL is the wrong vendor to spearhead the transition. Home care advocates have pointed to the company’s payment delays and missing wages to workers in Pennsylvania in 2013.
“We have not seen any other place in the country where PPL has done this well,” said Bryan O’Malley, executive director of the Consumer Directed Personal Assistance Association of New York State. “We think that the idea is flawed but that the state also chose arguably the worst vendor possible in PPL.”
The state is planning to announce additional subcontractors in the coming weeks, the governor’s office said.
Fiscal intermediaries chosen as subcontractors include Access Supports for Living, AccessCNY, All-Metro Health Care, BestCare, Burd Home Health, Community Care Home Health Services, Committed Home Care, Community Home Care, Companion Care of Rochester, Eagle Eye FV, ElderCare, Hamaspik Homecare, Heritage Christian Services, Horizon Home Care Services, Ideal Home Health, Independent Health Care Services, Jawonio, NY Foundation for Senior Citizens, People, Personal Touch Home Care of NY, Quality Family Care, Quality Touch, Special Touch Home Care Services and Technology Professional Group.
The U.S. Supreme Court refused to question New York’s rent-control system, turning away two appeals that said the rules violate apartment owners’ constitutional rights.
One appeal, pressed by 12 sets of property owners in New York City and Yonkers, targeted restrictions on landlords who want to reclaim rental units for personal use or convert buildings to condos or co-ops. A separate appeal by landlords in Westchester County challenged other regulations.
The court, as is its custom, made no comment. Justice Neil Gorsuch said he would have heard the appeals.
The simultaneous rebuffs mark the third time in a little more than a year that the court has declined to hear challenges to a system that governs a million units in New York City alone, shaping its neighborhoods, wallets and lifestyles. High court review could also have raised questions about rent-control laws in California, Oregon and 200 local jurisdictions.
The apartment owners said the restrictions violate the constitutional provision that prohibits governments from taking private property without just compensation.
“Governments do not have carte blanche to transform private property into state-controlled housing stock without just compensation,” the New York City and Yonkers owners argued in their appeal.
The cases reached the high court amid growing debate over the high cost of housing. President Joe Biden has called on Congress to pass a form of national rent control. The court in 2021 lifted the Biden administration’s moratorium on evictions during the Covid-19 pandemic.
New York City’s rent-stabilization system, which dates back to 1969, is among the most tenant-friendly in the nation. It requires landlords to renew leases except in limited circumstances such as failing to pay rent. The program, which governs buildings that were built before 1974 and have six or more units, also limits the amount of annual rent increases.
City and state officials urged the Supreme Court not to intervene. New York Attorney General Letitia James called the system “a critical tool to combat the harms caused by rent profiteering in a tight housing market including homelessness and economic instability.”
A New York-based federal appeals court rejected both challenges in March.
The challengers included Jane Ordway and Dexter Guerrieri, who are seeking to take over a rented apartment in an eight-unit building they own in Brooklyn Heights. Ordway and Guerrieri already live in two of the units, but the apartments are on different floors and the third unit would let the couple consolidate the living space.
City officials raised concerns Tuesday about a bill that would require building owners to install air conditioning during the hot summer months while acknowledging the need for immediate solutions to the growing scourge of heat-related illnesses.
City data shows extreme heat sent more than 740 New Yorkers to the emergency room this spring and summer, a majority of whom were living without air conditioning. But finding solutions to heat-related illness, which disproportionately impacts residents who are Black, low-income and have existing medical conditions, has become an intractable issue as city and state officials tangle with the cost and logistics of cooling every home while meeting the state’s emissions goals.
Around 11% of occupied rental units in the five boroughs did not have air conditioning, according to the city’s 2023 Housing Vacancy Survey. Another 21% of units don’t use the air conditioning they have due to the cost, according to the survey. Together, that’s 750,000 New Yorkers without cooling in their homes.
While New York provides subsidies for home air conditioning, funding is limited and roughly 275,000 renters in New York City remain without a unit. Legislation under consideration by the City Council would require landlords to maintain a maximum indoor temperature of 78 degrees on hot days by installing air conditioning or another cooling system in apartments.
The bill would mandate the Department of Housing Preservation and Development to enforce residential cooling requirements in the summer the way it does heating in the winter, said Council Member Lincoln Restler, its sponsor, at a Committee on Housing and Buildings hearing Tuesday.
Officials with the Department of Housing Preservation and Development agreed New Yorkers needed better cooling options but said the current legislation could conflict with the city’s long-term climate goals and fails to address the issue of energy affordability or the impact on the city’s electrical grid.
“At best, an outcome aligns with all the climate goals of the city,” said Jennifer Leone, HPD’s assistant commissioner for sustainability and chief sustainability officer. “We’re not there with the equipment that’s on the shelf and ready to deploy today.”
Restler also acknowledged the bill would create “major issues” for landlords to work out, which is why it comes with a four-year onramp before it becomes effective. Under the proposed law, some owners would be eligible for additional time to comply. The bill would impose new civil penalties on owners who are found in violation.
The costs of the new devices would likely be passed on to tenants, said Sarah Parker, senior research and strategy officer at the city’s Independent Budget Office. And it would not help pay for utility costs, which can range from $130 a month to run an energy-efficient unit for 12 hours a day to $500 a month for an inefficient device. The legislation does not require AC’s have an Energy Star rating or be appropriately sized, she pointed out.
The city requires cooling in new construction and some retrofitting, said AnnMarie Santiago, deputy commissioner for enforcement and neighborhood services at HPD. The city also received $1 million from the Environmental Protection Agency for an air conditioning recovery program that will begin next year and offers energy assistance for low- and moderate-income residents, Santiago said.
At the state-level, the Home Energy Assistance Program, a cooling subsidy for low-income and vulnerable residents, dished out $22 million to roughly 27,000 residents this year. But, as in previous years, the federally funded program ran out of money just weeks into summer. Fifty-one percent of the program’s funds go to heating assistance, while just 4% goes toward air conditioning and fans, according to Parker.
Will Gov. Kathy Hochul revive congestion pricing after all?
The governor is reportedly planning to huddle with lawmakers to decide whether to impose a toll on vehicles entering Manhattan south of 60th Street. Over the summer, Hochul paused the tolling scheme, likely at the behest of House Democrats who believed it would hurt their candidates in the suburbs.
Were it up to Hochul — and had Kamala Harris won the presidential election — congestion pricing would have remained in this purgatory for as long as possible. Hochul never signed the legislation into law (Andrew Cuomo did) and would prefer the whole debate to go away.
But Donald Trump, an avowed opponent of congestion pricing — and a product of central Queens, where the plan isn’t very popular — could kill it for good unless Hochul acts now in the final days of the Biden administration. As much as Hochul would privately prefer the death of congestion pricing, tolls of some sort are needed to fill gaping holes in the Metropolitan Transportation Authority’s capital budget.
Without congestion pricing, the subway and bus system could rot. Upgrades to signals and elevators would be delayed, and future expansions like the East Harlem phase of the Second Avenue subway or the Interborough Express could be imperiled.
Congestion pricing is correct on the merits — vehicles should pay for entering traffic-clogged corridors accessible by public transit — but, in the short term, it’s terrible politics. Trump became the first Republican to carry Nassau County since George H.W. Bush in 1988. Republicans stand to gain from congestion pricing because they can blame Democrats for a tolling program that is deeply unpopular among residents who like to drive to Manhattan. Hochul herself, when she runs in 2026, could suffer on Long Island and north of the city, where Manhattan tolls are no more well-received.
Join Gov. Kathy Hochul for a conversation about the city's future at NYC Crossroads on Nov. 19. Get tickets here.
Hochul is reportedly considering a $9 toll instead of $15, with the belief that the MTA could bond the rest and make up for shortfalls. This is a compromise the anti-congestion pricing crowd could accept but probably won’t. Any toll is to be opposed, and the wide range of interest groups against the plan — the Democrat-supporting United Federation of Teachers joined Republicans to sue to stop congestion pricing — will not be readily placated.
The silver lining for congestion pricing advocates is if Hochul gets it done, the tolling scheme will not be unpopular forever. London’s congestion zone was furiously opposed at first. Over time, locals get used to paying the toll, and ill feelings dissipate. Hochul can also hope that Trump, by the next term, is reviled and voters head to the polls to punish Republicans.
The progressives who are most supportive of congestion pricing should start holding the MTA accountable, though, for its massive cost overruns and terribly long timelines for infrastructure projects. Tolls are unpopular because locals feel they are getting little back for getting charged to enter Manhattan. Where are the new bus lines, the new subway lines, the efficient commutes that their toll and tax dollars are supposed to fund?
Republicans don’t care about this, either. For too long, both political parties have accepted mediocrity and watched as cities around the world build and fund world-class transit networks that put New York to shame. Congestion pricing won’t, alone, get New York to match the mass transit systems of the Far East or even Europe. But it’s a start, perhaps. Let’s see if Hochul actually drags it across the finish line.
Ross Barkan is a journalist and author in New York City.
One of the city's quintessential brunch spots is expanding for the first time in more than a decade, with the opening this week of Sarabeth's in Greenwich Village.
The popular spot for eggs benedict and a stack of pancakes opened its fourth Manhattan location Tuesday, at 100 W. Houston St., on the first two floors of a landmarked, 6-story, cast-iron building.
Founded in 1981 by husband-and-wife duo Sarabeth and Bill Levine, the brand started as a bakery churning out jams on the Upper West Side before expanding to open its first restaurant a couple of years later. Sarabeth's namesake divested from the restaurants to focus on her bakery and retail shop in Chelsea Market, which she opened in 1997. The more than 40-year-old empire is now run by RBM Restaurant Group, which also manages the Docks Oyster Bar near Grand Central.
Behind the scenes is executive chef Freda Sugarman, who opened the since-closed Park Avenue South location in 2013 and now leads the food program on West Houston Street, along with Stephen Olsen, who serves as the beverage director.
The new Greenwich Village location, between West Broadway and Thompson Street, joins three remaining outposts, all in Manhattan: on the Upper West Side, in Midtown and in NoMad. A Tribeca Sarabeth's location closed during the summer after 13 years because of what RBM Restaurant Group said was the loss of its lease.
Flatiron District-based real estate firm Tri-Star Equities, through an entity called Rocinante Corp., is the landlord of Sarabeth's new home, records show. The company did not respond to a request for comment by press time, and representatives for RBM Restaurant Group declined to share its lease terms with Crain's. But rents for retail and restaurant space in Greenwich village and nearby neighborhoods range from about $70 to $140 per square foot, according to LoopNet.
New York City is taking a “glass-half-full approach” to Donald Trump’s election as president, the city’s Economic Development Corp. president said Tuesday, expressing hope that the new administration will continue to fund key infrastructure projects in the region.
In an onstage interview at a Crain’s New York Business Power Breakfast, EDC chief Andrew Kimball avoided directly discussing the president-elect — although he noted that “somebody who did well in real estate in New York City” surely appreciates the city’s importance to the national economy.
As for Trump’s promised tariffs on foreign imports, Kimball echoed widespread expectations that the policies would quickly raise the cost of goods. But he expressed some openness about the taxes on imports, saying they have some overlap with Democratic initiatives like the CHIPS and Science Act that has showered New York state with billions of dollars for industrial development.
“If part of the tariff goal is to onshore good-paying manufacturing jobs, let's see how it plays out, for upstate in particular,” Kimball said, speaking to Crain’s Editor-in-Chief Cory Schouten.
Kimball spent much of his time Tuesday discussing the Harbor of the Future initiative — an ambitious set of projects that includes redeveloping the 122-acre Brooklyn Marine Terminal, constructing an electric vehicle hub at Hunts Point, and opening climate hubs on Governors Island and at the Brooklyn Army Terminal in Sunset Park. Taken together, the projects could create 53,000 jobs, Kimball said — and also insulate the city from supply-chain disasters by changing the way New York transports goods.
“We all just learned what can happen when there is a major bridge that goes down at the Port of Baltimore,” he said. “We need to be ready to get food directly into the city and have a food distribution network.”
A new water connection to Hunts Point may be created “soon” as part of the redevelopment of that Bronx food hub, Kimball said. As for the closely watched transformation of Red Hook surrounding the Brooklyn Marine Terminal, Kimball said the city is not yet ready to unveil an expected unit count for the housing it plans to permit on the site. The city will approach private developers after it completes a master plan, he said.
“On 122 acres, you should be able to put a lot of housing there,” Kimball said.
Other news from Kimball’s remarks:
- EDC on Tuesday unveiled plans for an “International Landing Pad” — a network that will pair local organizations with international companies seeking to expand their operations in New York. EDC is asking for submissions by potential partner groups; by way of example, Kimball imagined a Seoul-based artificial intelligence startup opening its first New York office or a Belgian biotech firm trying to hire U.S. researchers, which could use the network to find talent, capital or customers.
- EDC is still seeking a naming-rights sponsor to shore up the finances of the NYC Ferry system, as Crain’s reported in June. “Hopefully there will be good results,” Kimball said, calling NYC Ferry “an incredible brand.”
- The city will soon announce a chosen developer to build about 600 housing units on Staten Island’s New Stapleton Waterfront. Notably, the project will likely be built using sustainable mass timber — the largest such project in the city’s history, Kimball said, explaining that EDC had been “pleasantly surprised” by the private sector’s interest in the material.
- Kimball said the city will make news “in the coming days” about the Bronx’s Kingsbridge Armory. After years of failed redevelopment attempts, the city released an open-ended RFP last September.
- On return-to-office, Kimball said New York “has so far avoided the commercial doom loop some have feared” — as most firms settle into a three-day-a-week system, or four days at Class-A “trophy” office buildings.
- Kimball also touted recent high-profile leases, including OpenAI’s 90,000-square-foot deal at the Puck Building, Bridgewater Associates’ long-term lease at 295 Park Ave., Citadel Securities’ anchor tenant arrangement at Vornado and Rudin’s 350 Park Ave. skyscraper and Chobani’s unique corporate headquarters at 360 Bowery.
- Kimball urged the City Council to approve Mayor Eric Adams’ City of Yes housing plan in the coming weeks, which he connected to Trump’s election victory. “There was a level of dissatisfaction in government not delivering on what people need, and the people of New York were very clear about what they need: They need housing,” Kimball said.
- Asked about Trump’s promised mass deportations, Kimball said the city’s recent migrant arrivals will ultimately benefit New York’s economy. But he added that Mayor Adams had long called for stricter border policies — “and some folks might have been smarter to listen,” Kimball said.
Leases
Luxury vintage retailer opening SoHo storefront
Address: 65-69 W. Houston St., Manhattan
Landlord: Manhattan Skyline Management Corp.
Tenant: No Standing NYC
Lease size: 1,320 square feet
Asset type: Retail
Law firm signs 10-year lease in an SL Green Midtown skyscraper
Address: 810 Seventh Ave., Manhattan
Landlord: SL Green
Tenant: Kauff McGuire & Margolis
Lease size: 17,000 square feet
Lease length: 10 years
Asset type: Offices
Brokers: Cushman & Wakefield's Peter Trivelas, Justin Royce and Justin Sodokoff represented the tenant. The landlord was represented by Harry Blair, Tara Stacom, Barry Zeller and Pierce Hance, also of Cushman & Wakefield.
Sales
Developer sells Midtown tower at a loss after loan default
Address: 292 Madison Ave., Manhattan
Seller: Vanbarton Group
Buyer: American Exchange Group
Sale price: $90.5 million
Asset type: Mixed-use
A fitness executive whose gyms came under fire during the pandemic for charging customers despite the facilities being closed is looking to sell his uptown mansion.
Bob Roberts, a co-founder of the Lucille Roberts women’s-only gym chain with his late wife, Lucille, has listed his nine-bedroom townhouse at 4 E. 80th St. for $59 million, according to an ad that appeared over the weekend.
Decorated in a Versailles-level of opulence, No. 4 features a living room with 14-foot ceilings, a paneled formal dining room and three kitchens, plus an elevator. On the sixth floor is a gym, naturally.
The neo-Gothic, seven-level home, which seems to have doubled as both a residence and a workplace based on the number of offices and conference rooms packed into its floors, has been on the market before. A decade ago Roberts unsuccessfully listed the limestone property at Fifth Avenue for $90 million, according to StreetEasy, meaning he’s knocked off about 35% to find a taker.
But the steeply discounted price would still allow Roberts to come out ahead. He and his late wife paid $6 million for the nearly 20,000-square-foot edifice in 1995, according to the city register, though they extensively renovated the property, which was previously owned by nonprofit charity group Young Men’s Philanthropic League.
The Roberts launched their first health club in 1969 with a focus on the racquet sport squash, though they branched out with more of a general fitness model about a decade later, according to a company biography. Lucille Roberts died of lung cancer in 2003. According to a LinkedIn profile, Bob Roberts in recent years served as chairman of the company, which was acquired in 2017 by Town Sports International Holding, the Florida-based owner of New York Sports Club, for undisclosed terms. The Lucille Roberts chain reportedly had 16 East Coast outposts at the time, in New York City, on Long Island and in New Jersey.
When Covid and its assorted lockdowns hit, Town Sports struggled to survive, as did other gym chains. But Town Sports allegedly charged dues to members while its gyms were shuttered and would not let members cancel or get their money back.
State Attorney General Letitia James and other officials sued the company and won, which resulted in a $110 million settlement for thousands of members. Along the way Town Sports filed for Chapter 11 bankruptcy protection. In its September 2020 petition, the company claimed it had between $500,000 and $1 billion in assets and the same range in liabilities, documents show. The company also had as many as 25,000 creditors at the time, filings show. A Delaware judge approved Town Sports’ reorganization in December 2020.
In 1915 retail magnate Frank Woolworth built 4 E. 80th St for his oldest daughter, Helena McCann, who lived in the 35-foot-wide dwelling until she died in 1938. A Roman Catholic novitiate purchased the property in 1943 and owned it until 1955, when the Philanthropic League acquired it.
Broker Adam Modlin, who is marketing the property, did not reply to an email seeking comment.
For its part, the Lucille Roberts brand appears to have just a single location left in New York City, in Forest Hills, Queens.
The Adams administration is working with the Real Estate Board of New York on a plan to bring down the cost of demolishing obsolete office towers.
“That is something we are in active conversations with REBNY and others,” Andrew Kimball, CEO of the city Economic Development Corp., said Tuesday at a Crain’s Power Breakfast. “It is extraordinarily expensive to bring down a building, but we need more of that.”
Kimball said the program would be targeted at buildings that aren’t landmarked and which no longer attract tenants. Such buildings, he said, should be replaced by new office or apartment towers for which there is ample demand.
He declined to offer additional details and wouldn’t comment further after the breakfast. REBNY had no immediate comment.
It cost JPMorgan an estimated $160 million to tear down its former headquarters at 270 Park Ave. three years ago so that a new 70-story, $3 billion tower could rise in its place.
For the many developers without JPMorgan’s resources, some combination of property-tax discounts, loan subsidies, or even cash grants could be necessary to clear out buildings that aren’t viable anymore so they can be replaced by new office or apartment towers.
Such assistance would mark a significant escalation by the city, which to date has offered incentives for landlords to convert older Class B or C buildings into new, amenity-rich Class A office space under a program called Manhattan Commercial Revitalization. In January the city said two nearly empty buildings were approved for up to $100 million in that program, in which developers must commit to investing a sum equal to at least 75% of the assessed value of their building and land.
But no further recipients have been announced, which may reflect continued weakness in the market for office space. A spokesman said EDC’s goal is to announce the next round of recipients in early 2025.
Approximately one-quarter of Manhattan’s 600 million square feet of office space remains empty and in Midtown South the vacancy rate last quarter was a record 26%, according to the Alliance for Downtown New York. Asking rents for downtown office space continue to fall, the business group said, to about $55 per square foot. Meantime, Class A space is mostly full. Along Park Avenue the vacancy rate is just 13%, Cushman & Wakefield says.
Ireland’s ambassador to the United Nations has a new home.
Fergal Mythen has purchased a four-bedroom penthouse at the condo 695 First Ave. for $8.5 million, according to a deed posted to the city register Friday that lists the buyer as the Government of Ireland, though Mythen signed the paperwork.
The deal, which went into contract Aug. 29, closed Sept. 30, suggesting that Mythen squeezed in the transaction while in town for the U.N.’s annual meeting. The global diplomacy group’s session this year, its 79th, kicked off Sept. 10. And the bustling “general debate” period, which most representatives from the U.N.’s 193 member countries typically attend, ran from Sept. 24 to Sept. 30.
Perched on the top floor of the 43-story black-glass tower between East 39th and East 40th streets, Mythen’s duplex unit features a private elevator, four and a half baths, and an 819-square-foot great room with double-height ceilings and East River views, according to a diagram in the condo’s offering plan. Corcoran Sunshine, the brokerage marketing the building, does not appear to have listed the unit publicly.
The seller was the condo’s sponsor, the developer Soloviev Group, which began marketing the tower’s 148 units in 2018. Though initially anticipating a sell-out of $551 million, the firm now expects a revised haul of $451 million, according to a 2022 plan amendment.
Indeed, Soloviev originally sought to sell Mythen’s penthouse for $10.8 million, and so ended up unloading it for 20% less, based on the plan.
One of the developer’s marketing strategies may have paid off. About a year after sales began, Soloviev, whose chairman is Stefan Soloviev, a son of the late developer Sheldon Solow, decided to slap the name 1 United Nations Park on the project, presumably to play up the site’s location two blocks to the south of the U.N.
In 2021 closings began in the condo section of the tower, which also includes a 408-unit rental portion that goes by the building’s street address, 685 First Ave. But several sponsor units still appear unsold.
Mythen, a longtime high-ranking official who worked to help implement the 1998 Good Friday agreement ending decades of conflict in Northern Ireland, according to an online biography, became Ireland’s U.N. ambassador in summer 2022.
For years some U.N. delegates and other foreign dignitaries have underpinned residential sales activity on Manhattan’s East Side, including buyers who snap up spacious apartments for meeting and entertainment spaces. For about two decades, for instance, Great Britain’s consulate general held forth in a 5,800-square-foot penthouse on East 51st Street near First Avenue, though the British government unloaded the aerie in 2023 for $5.2 million by way of an auction.
Corcoran brokers had no comment by press time. And a phone message left for Mythen at Ireland’s U.N. office on Second Avenue went unreturned.
Leases
Apparel firm expands in Midtown South
Address: 48 W. 37th St., Manhattan
Landlord: Adams & Co.
Tenant: Isaac Morris Ltd.
Lease size: 40,508 square feet
Asking rent: $42 per square foot
Asset type: Office/retail
Broker: David Levy represented the landlord in-house.
Energy firm leaves Williamsburg for Hudson Square
Address: 200 Varick St., Manhattan
Landlord: GFP Real Estate
Tenant: David Energy
Lease size: 7,995 square feet
Lease length: Four years
Asset type: Office
Brokers: Newmark’s Robert Silver, Brittany Silver and Anthony Sciacca represented the landlord, along with Jeffrey Gural and Rhonda Singer in-house. GFP Real Estate’s Allen Gurevich represented the tenant.
Sales
Long Island City’s Zipper Building changes hands
Address: 47-16 Austell Pl., Queens
Seller: Vanbarton Group
Buyer: Jack Guttman
Sale price: $11 million
Asset type: Office
Broker: Cushman & Wakefield’s David Mosler represented the seller.
Lender takes control of SoHo former yoga studio
Address: 430 Broome St., Manhattan
Seller: Josh Rahmani
Buyer: Bixby Bridge Capital
Sale price: $10.5 million
Asset type: Retail
Westchester landlord unloads Rego Park rental building
Address: 65-60 Booth St., Queens
Seller: Robert Miller
Buyer: Moses Eckstein
Sale price: $11.3 million
Asset type: Multifamily
When the history books are written about the fate of longshoremen in the U.S., few characters will loom as large as Harold Daggett.
The 78-year-old has risen from working on the docks to become one of the most influential and highest-paid union leaders — a firebrand who rails against corporate greed while taking home nearly $1 million in annual pay. And despite reports of a lifestyle of luxury cars, a mansion in New Jersey and previous allegations of ties to powerful mobsters, members of the International Longshoremen’s Association have fully embraced Daggett and his bare-knuckled approach.
After just three days of a strike that disrupted every major port from Maine to Texas, the New Yorker has already wrung concessions from the alliance of port operators and shipping lines, securing a tentative agreement for a 61.5% wage increase over six years — a huge boost, albeit below an initial demand of almost 80%. In return, dockworkers have agreed to extend their contract through Jan. 15, deferring the much thornier dispute over port automation for future negotiations.
The showdown on the East and Gulf coasts has demonstrated the power of dockworkers to play havoc with the U.S. economy, draining billions of dollars each day and threatening supply chains for everything from fruit to automobiles. It’s been playing out just weeks before the presidential election, an ultra-close contest in which union support has become an important trophy for both parties.
The ILA endorsed President Joe Biden in 2020 but it has refrained from officially backing either Vice President Kamala Harris or former president Donald Trump this time around. In a statement on Thursday evening, Biden praised the port agreement.
“I want to thank the union workers, the carriers, and the port operators for acting patriotically to reopen our ports and ensure the availability of critical supplies for Hurricane Helene recovery and rebuilding,” Biden said. “Collective bargaining works.”
The strike also highlighted just how much is at stake for longshoremen who face looming and possibly existential threats to their jobs. Shipping lines flush with pandemic-era profits after skyrocketing freight costs, have an opportunity to usher East and Gulf Coast ports into a modern era of automation that other global hubs such as Rotterdam and Los Angeles have already embraced.
While there’s still debate in the industry over whether technologies like automated cranes and driverless vehicles have truly cost workers their jobs, for Daggett and the ILA it’s a red line.
“They’re making billions and millions of dollars,” Daggett said on the picket lines this week, referring to the shipping lines and port operators. “But they don’t want to share it. They’d rather see a fully automated terminal right here on the East Coast so they can make more money. They are money crazy.”
Daggett, who has a penchant for making a statement with swear words and gold chains, rakes in more than most other union leaders. His income stems from dual salaries from his roles in the national ILA and an emeritus position for the New Jersey local chapter, where he began his career and was a worker in the last big East Coast longshoremen strike in 1977.
He collected a combined salary of about $900,000 last year, according to U.S. Department of Labor data. His counterpart on the West Coast, William Adams, president of the International Longshore & Warehouse Union, earned a salary of $168,000, while Shawn Fain of the United Auto Workers received about $200,000. Fain last year rose to prominence by negotiating historic pay increases and other concessions for workers at General Motors, Ford Motor and Stellantis plants following a six-week strike.
According to the data, only union leaders that represent Hollywood actors and professional sports players received higher total compensation than Daggett. Since 2011, he has made about $9 million between his two salaries, according to an analysis of the federal filings. Disbursements for official business — which can include meal and travel allowances — further add to the total.
Elon Musk this week took to X to comment on reports that Daggett owned a 76-foot yacht. On Wednesday, the ILA published a statement on social media, saying Daggett and other ILA top officials have faced death threats after the New York Post published aerial photos of his sprawling New Jersey home along with his address. Daggett didn’t respond to several requests from Bloomberg News for comment sent by email and text messages through the ILA.
Daggett is “colorful, but he knows what he’s fighting for. He started on the docks like everybody else,” said Ken Riley, an ILA vice president based in Charleston, South Carolina. “He’s taken us places we’ve never been.”
Daggett’s past has also raised eyebrows. In a federal indictment from two decades ago, prosecutors claimed Daggett’s ascent within the ILA was facilitated by ties to the Genovese crime family. He has denied any connection to the mob and was acquitted at trial in 2005, along with two other co-defendants — another ILA official and an alleged captain of the crime family. The purported mobster, Lawrence Ricci, disappeared during trial and was later found dead in the back of a car parked at a New Jersey diner.
Daggett left his day-to-day role leading the New Jersey branch in 2011 when he was promoted to the headquarters job, though he’s continued to serve in an emeritus capacity. A statue honoring him was recently unveiled outside the ILA headquarters in North Bergen, New Jersey.
His son, Dennis, is now president of the local branch. Another son, John, also plays a leadership role in the local New Jersey and Atlantic Coast district branches.
“He’s a tough man. He’s been through a lot,” Charles Seaton, the president of ILA Local 1766, said of Daggett. “He has longevity in the business and that’s what it takes: to know where you come from, to know where you’re going.”
For now, the threat of supply chain squeezes before the election and Christmas are over, but finding a solution on automation that both the shipping lines and the dockworkers are satisfied with is likely to prove challenging, setting up the potential for another showdown come January.
Labor groups warn that automating jobs threatens not only local employment but also tax revenue. Critics point out that U.S. ports are already among the least efficient in the world, and without modernization, they risk falling further behind global competitors.
Looking beyond the current labor talks in the U.S., Daggett aims to broaden the union’s fight against port automation on a global scale. Dennis, who also serves as the head of the International Dockworkers Council, has pledged to rally overseas support for the ILA’s ongoing efforts, declaring in a recent video that it will be “the biggest display of international solidarity that this world has ever seen.”
This week, Daggett had instructed ILA workers to remain on the picket lines for as long as necessary to secure the union’s demands. In contrast to other groups that typically require a vote by members for a walkout, the ILA’s rules give Daggett a significant amount of the power over labor negotiations.
At the Port of Wilmington in North Carolina this week, Greg Washington, president of ILA Local 1426, stood among about 50 workers on the picket lines. When asked how long they planned to stay, Washington replied, “Until Mr. Daggett tells us we’re going to do something different.”
The amount of available retail space in the city fell to its lowest level on record last quarter, the latest sign of the sector's shockingly strong recovery from the pandemic, according to data from JLL.
The availability rate was 14.7% for the third quarter of 2024, while the total number of available spots was 202, both record lows, the brokerage's report says. The figures mark a remarkable turnaround for the industry, which had already been struggling before the pandemic with an average availability rate of 21% in 2019, according to JLL. The initial wave of store closures and bankruptcies during the onset of Covid only made things worse, with availabilities peaking at 28% in 2021.
But the sector is now in a much better place, with the amount of available space falling quarter over quarter across seven of the nine prime submarkets that JLL tracks. Availability rates last quarter ranged from 6.4% on Madison Avenue — which was actually one of the two submarkets that saw a slight increase — to 33.3% on 34th Street/Herald Square.
The availability rate on Lower Fifth Avenue tied its record low of 11.3%, while SoHo's fell to 11.5%, according to the report. French skin care company Caudalie also purchased a SoHo retail property at 130 Greene St. for about $10 million last quarter, continuing a trend of retailers opting to buy their own buildings.
The average asking rent remained lower than before the pandemic, at $545 per square foot, down slightly year over year and quarter over quarter as well. However, some submarkets still saw the average tick up significantly, including year-over-year increases of 23% in Times Square and 9% on Upper Fifth Avenue. The average asking rent ranged from $238 per square foot in Williamsburg to $2,257 per square foot on Upper Fifth Avenue overall.
Yeshiva University taking 160,000 square feet at 1293 Broadway in Herald Square tops the report's list of significant leases during the third quarter (Colliers had also included this deal in its third quarter report on Manhattan's office market). Other major retail leases included hospitality firm Convene taking about 75,000 square feet at 30 Hudson Yards and footwear firm Cole Haan renewing about 62,000 square feet at 620 Sixth Ave.
In the second quarter, the retail availability rate was 15.3%, and there were 210 available spots, per JLL's report from that period.
An overwhelming number of New Yorkers want Eric Adams to step down after he became the first sitting mayor in the city’s modern history to be indicted on corruptions charges.
Sixty-nine percent of New York City residents surveyed, including 71% of Democrats, said the first-term mayor should leave office, according to a Marist Poll published Friday. If Adams doesn’t resign, 63% of residents said Gov. Kathy Hochul should begin the process of forcibly removing him, the poll found.
“It’s hard to imagine how Mayor Adams could be faring any worse in the court of public opinion,” Lee Miringoff, director of the Marist Institute for Public Opinion, said in a statement.
Federal prosecutors last week charged Adams with bribery, conspiracy and breaking campaign finance laws. The former police captain is accused of secretly accepting illegal contributions to his 2021 campaign and of taking free flight and hotel upgrades and other gifts without disclosing them as required. And he may face more counts soon, prosecutors said this week.
The poll found only 26% of residents approve of the way Adams is handling his job, with 74% saying they disapprove. But Adams’ approval rating was suffering even before the indictment, as federal investigations into his inner circle became public and he grappled with issues related to the more than 200,000 migrants who have arrived in the city in the past two years.
The Marist Poll surveyed 1,073 adults over age 18 residing in New York City online and via text on Sept. 30 and Oct. 1. The poll has a margin of error of plus or minus 1.4 percentage points.
U.S. job growth last month topped all estimates, the unemployment rate unexpectedly declined and wage growth accelerated, reducing the odds the Federal Reserve will opt for another big interest-rate cut in November.
Nonfarm payrolls increased 254,000 in September, the most in six months, following an upwardly revised 72,000 advance over the prior two months. The unemployment rate fell to 4.1% and hourly earnings increased 4% from a year earlier, according to Bureau of Labor Statistics’ figures released Friday.
Combined with data earlier this week showing that demand for workers is still healthy while layoffs remain low, the payrolls report is likely to alleviate concerns that the labor market is deteriorating. The figures also showed fewer Americans were working part-time for economic reasons and people who recently lost their jobs were able to find work elsewhere.
Fed Chair Jerome Powell this week reaffirmed that shielding the labor market was part of the reason why the Fed decided to kick off its easing cycle with a larger rate cut in September. The data are a welcome development for Powell and his colleagues who desire no further cooling in the job market.
The S&P 500 opened higher, and the dollar and Treasury yields rose after the figures. Pricing in the swaps market showed traders paring bets on a Fed interest-rate cut larger than a quarter-point in November.
The Fed has “a better chance of getting this right and not being behind the curve given this report,” said Laura Rosner-Warburton, a senior economist at MacroPolicy Perspectives, noting the figures lower the odds of another half-point cut.
The solid report is good news for Vice President Kamala Harris as she heads into the final weeks of a presidential election race that has focused on voters’ views on the economy. Americans have been growing wary of job prospects at the same time as they contend with a high cost of living.
Fed officials also pay close attention to wage growth, as it can help inform expectations for consumer spending — the main engine of the economy. Hourly earnings rose from a year ago by the most in four months. Wage growth for production and nonsupervisory employees cooled to 3.9%.
The gain in hiring last month was driven by leisure and hospitality, as well as health care and government. The payrolls diffusion index, which measures the breadth of changes in private employment, rose to the highest since the start of the year. Manufacturers, however, cut jobs for a second month.
October report
The October jobs report, which will be released Nov. 1, will include the impact of a walkout last month by some 33,000 Boeing factory workers. Another large strike, by dockworkers, ended after three days and likely won’t have a direct effect on the month’s payrolls count.
However, another wrinkle is Hurricane Helene, which cut a path of death and destruction across a swath of the Southeast. Parts of the region are struggling to reopen roads and reconnect power, indicating business will take time recover.
The latest jobs report showed the so-called underemployment rate — which includes those working part-time for economic reasons and discouraged workers — fell to 7.7% in September, the first decline in nearly a year.
The participation rate — the share of the population that is working or looking for work — held at 62.7% for a third month. The rate for workers ages 25-54, also known as prime-age workers, dropped to 83.8%.
While layoffs haven’t been a main feature of the labor-market cooling in the U.S., they’re picking up in other countries. Samsung Electronics is laying off workers in Southeast Asia and Oceania as part of a plan to reduce global headcount, and Volkswagen is both trimming positions in China and mulling plant closures at home in Germany.
I read your report, "New York’s Nonprofit Shadow Government" (published on September 16), which claims that the city’s nonprofits operate without sufficient oversight. While it's true that there are always some bad actors in any sector, portraying the entire nonprofit field as largely unregulated is both inaccurate and misleading. In reality, most nonprofits maintain high standards of transparency and accountability.
As a nonprofit leader with 25 years of experience, I can attest that New York City nonprofits – many of which are the backbone of our community – are held to rigorous standards. As the third largest employer in the U.S., the nonprofit sector is often the first responder to the city’s most pressing challenges, from food insecurity to affordable housing and childcare. Nonprofits have built deep relationships within the communities they serve, fostering trust and expertise that is essential for the delivery of critical services.
Despite these indispensable contributions, nonprofit contracts remain chronically underfunded, and city payments on those contracts are often woefully delayed. This forces nonprofits to extend interest-free loans to the city – sometimes in the millions – while continuing to administer essential services on behalf of the city.
No one sector can solve these challenges alone. Rather than assigning blame, we should be focusing on cross-sector collaboration. It is in the city's best interest to ensure that nonprofits are successful in their mission to support millions of New Yorkers every day. That means fully funding contracts, paying them on time, and giving nonprofits a true seat at the decision-making table. By doing so, we can create stronger partnerships that benefit all New Yorkers.
Phoebe Boyer is the president and CEO of the nonprofit group Children’s Aid.
Dockworkers agreed to end a three-day strike that had paralyzed trade on the East and Gulf coasts and threatened to become a factor in the presidential election.
The International Longshoremen’s Association and the U.S. Maritime Alliance extended their previous contract through Jan. 15, the two groups said in a joint statement Thursday. Ports are opening Friday and the two sides will restart negotiations on a long-term agreement, which will include a pay increase of about 62%.
Fears of a sustained emergency swelled through the week, with analysts and industry officials warning that the disruption would quickly extend beyond the container imports, exports and autos impacted directly by the walkout. Estimates of the cost to the U.S. economy ranged from $3 billion to $5 billion a day.
“The strike is over,” ILA Local 333 President Scott Cowan told a CBS affiliate just after delivering the news to members gathered at the picket line outside the Port of Baltimore.
The agreement gives the ILA and USMX — as the group of terminal operators and shipping liners is known — time to resolve even more contentious issues without threatening the economy just weeks ahead of the election.
Shares of shipping lines in Asia fell as the suspension of the strike damped expectations that container rates would rise due to reduced capacity. Copenhagen-based A.P. Moller-Maersk A/S dropped as much as 8.6%, while Hapag-Lloyd AG of Hamburg, Germany, sank almost 14%.
“We’re going to receive a 61.5% increase over the next six years and we’re going to have other language to protect us from automation worked out over the next few months, and other issues that we need resolved,” Cowan said.
Crises averted
Americans started to panic over potential shortages. Some anxious shoppers stocked up on goods, especially in areas affected by Hurricane Helene, which hit several Southeastern states with flooding and power outages. One national grocery store chain set purchase limits on paper towels, toilet paper and water, adding to pressure on President Joe Biden to intervene.
The deal neutralizes a potential political issue for the White House and the campaign of Vice President Kamala Harris. A prolonged strike would have forced her to confront a crisis that fueled inflation.
It also spares Biden from having to put any public pressure on the ILA as he and Harris fight GOP nominee Donald Trump for the support of union’s rank and file members. A deal, however temporary, means Biden won’t have to decide whether to bear the political burden of a crippling strike or distance himself from the demands of the union.
Even though the strike lasted just three days, the cargo backlog is likely to take over a month to clear, according to Project44, a supply chain data company in Chicago. Port terminals began battening down the hatches days ahead and it will take them a while to fully re-open.
The Port of New York & New Jersey said vessel activity will resume on Friday night. In Georgia, with ports in Savannah and Brunswick, business will begin to function Friday morning. The Port of Virginia said it will take about 24 hours to restore operations and will offer weekend hours for cargo pickup and delivery.
In the meantime, dozens of ships carrying containers and autos that anchored off the coast of major trade hubs may continue arriving faster than they can be unloaded. As of early Friday, there were more than 30 container ships and car carriers anchored off the coast of Texas, Georgia, South Carolina, Virginia and New York, according to ship-tracking data compiled by Bloomberg.
‘Going to hold’
Biden, who sided with the union, commended both sides and linked the port closures to hurricane recovery efforts.
“I want to thank the union workers, the carriers, and the port operators for acting patriotically to reopen our ports and ensure the availability of critical supplies for Hurricane Helene recovery and rebuilding,” he said in a statement Thursday after the deal was announced. “Collective bargaining works.”
Retailers, agricultural exporters and the U.S. Chamber of Commerce have been sounding the alarm since the ILA called off negotiations with the USMX in June. Hundreds of industry associations had called on Biden head off the strike even before it started.
The National Retail Federation applauded the decision to reopen ports while negotiations continue, and said “it is critically important” that the two sides sign a final deal ahead of the new deadline to prevent a repeat scenario in three months.
“The sooner they reach a deal, the better,” CEO Matthew Shay said.
While the ILA and USMX found common ground on wages, the remaining issues may prove to be thornier ones. ILA chief Harold Daggett has railed against the foreign-owned companies he says want to replace union jobs with robots, and says he won’t quit until language on technology in the next contract is tightened up. The companies have offered to leave it as is, which they see as a concession.
Biden expressed optimism about the strike suspension.
“We’ve been working hard on it,” he told reporters Thursday evening. “By the grace of God and good will of neighbors, it’s going to hold.”
A new report filed with the New York legislature by state cannabis regulators on Oct. 1 paints a picture of a continually growing legal market that has reached nearly $654 million in sales, but which has also apparently left more than 200 “justice-involved” retail license holders in limbo.
The wide-ranging report, authored by the Office of Cannabis Management and the Cannabis Control Board, touched on a host of issues facing the state’s nascent marijuana trade, including ongoing enforcement against unlicensed businesses, the need for more funding for social equity companies, and gaps in the regulatory system that still need to be addressed.
“There is much work to be done, and we remain undaunted by the task ahead,” OCM Acting Executive Director Felicia Reid wrote in an introduction to the report.
The numbers
The OCM and CCB have approved 1,704 business permits, including full licenses and provisional permits, but still have 5,698 applications pending. According to the report, the regulators have formally denied 1,012 applications. In addition, there are 24 medical dispensaries operational, including 10 that are dual medical-recreational.
The total number of fully approved licenses includes 205 Conditional Adult Use Retail Dispensary (CAURD) permits that were awarded last year to “justice-involved” applicants that had criminal cannabis records; a total of 463 CAURD applications had been tentatively approved.
Of the 205 fully approved CAURDs, 150 were operational as of Sept. 15, according to the report. As of Sept. 27, there were just 202 legal recreational marijuana shops in the entire state.
“OCM has reviewed and scored every CAURD application received. OCM is nearing the completion of issuing a final license determination on every initial CAURD application received,” the report stated.
Sources previously told Green Market Report that many of the CAURD licensees have faced serious difficulty both raising money with which to obtain retail locations and finding compliant sites that aren’t too close to other existing licensed shops. The stores must be at least 1,000 feet away from their nearest legal competitor.
The report also noted that the Cannabis Social Equity Investment Fund, which was originally supposed to inject $200 million into the dispensary buildout process on behalf of CAURD licensees, has only been utilized by 20 of the CAURDs.
The 10 companies licensed to grow and sell medical marijuana in the state have also been slow to move into the recreational retail side of the industry, the report found, with just four of the companies opening dual medical-recreational dispensaries thus far. The other six have either simply not opened recreational sales or not even applied for permission to do so, according to the report.
Licensed medical cannabis companies — which the state refers to as registered organizations, or R.O.s – Curaleaf, Etain and Fiorello Pharmaceuticals have each opened with the maximum of three adult-use shops apiece; PharmaCann has opened just one.
Still, the OCM is moving to expand the number of licensed medical marijuana companies, which means there will be more vertically integrated permits handed out at some point in the not-too-distant future.
“OCM received 10 applications and the CCB will identify new R.O.s in fall 2024,” the report stated, noting that an application period ran from October to December last year.
Legal cannabis sales also steadily increased as more shops opened and as New York City continued its crackdown on the unlicensed market, with August sales hitting a new monthly high of $97.4 million, up from the previous high in June when sales reached $74.3 million.
September sales were on pace to surpass August when the report was finalized, with sales having reached $63.5 million by the middle of the month.
Read the full story at Green Market Report.
A now-defunct SoHo-based real estate company has offloaded a trio of mixed-use properties for $50.5 million, according to the broker involved in the transactions.
Page Management, which is no longer in operation, sold the three West Village and Chelsea buildings to low-profile real estate firm the Sani Group. The properties, which comprise 100 residential apartments and a few retail units across 68,484 square feet, were the last remaining in Page's portfolio.
The addresses are 300 W. 12th St., which contains 53 units and sold for $26.5 million; 240 W. 15th St., which contains 35 units, including one retail, and sold for $17 million; and 5 Jones St., which contains 12 units, including two retail, and sold for $7 million, according to information from Canada-headquartered company Avison Young.
The global firm represented both the buyer and the seller in the three deals totaling more than $50 million. Brokers from Avison Young's tristate investment sales team, led by James Nelson, Brandon Polakoff, David Shalom, Ryan McGuirl, Alexandra Marolda and Ed Nelson — all of whom are based in the firm's Manhattan office — were involved in the transaction, which closed last month, Nathan Reyna, a spokesman for Avison Young, told Crain's.
Little is known about the buyer, and attempts to reach the firm and its main contact, Abraham Sanieoff, were unsuccessful.
Reyna declined to comment on the buyer but said the properties will remain as is with no significant redevelopment. He added, however, that there is an opportunity for some "cosmetic changes."
Sarah Cole, the general manager of trendy Manhattan izakaya joint Kin Gin, has worked for some of the hippest Japanese restaurants in New York. The accomplishment can seem like a far cry from her suburban Atlantan childhood, when nights on the town often involved unlimited amounts of breadsticks.
“A nice restaurant for us back then would have been Olive Garden,” Cole said. “My horizons have been really expanded.”
Similarly, the idea that Cole would someday be quarterbacking a team of 20 during 12-hour shifts to help a five-month-old restaurant stand out in the competitive scene of the Lower East Side would also have likely surprised her younger self.
Favoring psychology courses in college, she instead envisioned a career as a counselor of low-income children and in fact briefly worked with adults battling substance-abuse and anger-management issues upon graduating. “Things have turned out a lot different from what I had anticipated,” Cole said.
After a stint employed by a rehab clinic in California in her mid-20s, Cole on a whim went totally outside her previous experience and applied for a job at the Los Angeles outpost of Nobu; the country’s best-known sushi brand hired her as a hostess in 2011 when she was 24. A transfer to the Nobu branch in Midtown Manhattan, where Cole was promoted to maitre’d, came in 2013.
Other raw-fish-focused eateries followed, including Murray Hill’s Zuma, which she helped launch, and more recently an executive-level gig at Simple Venue’s Sushi by Bou, which operates speakeasy-style, graffiti-tagged omakase counters tucked inside flower shops and hotel lobbies.
Throughout her career in the high-pressure, high-burnout food-service world, she has been able to employ some of the well-honed empathy skills she learned as a counselor.
“This industry can wear people down, and emotions run high,” she said. “So I tell my staff, ‘We’re in this together, and at the end of the shift, we can work through whatever it is.’”
The pandemic shutdowns weren’t great for professional growth, naturally. In fact, Williamsburg chicken-and-waffles hotspot Sweet Chick, where Cole snagged her first general manager job, had to let her go when the novel coronavirus hit. But the forced break might not have been such a bad thing. During a career that often had Cole turning in at 5 a.m., some months off came as a balm. The break also allowed Cole to become certified to teach yoga, which helps her stay relaxed today.
“The pandemic changed work-life balance for the better,” she said.
Kin Gin has earned plaudits for its inventive clam, caviar and crispy pigs ear dishes since it opened in April. Though its skylight-lined, richly-colorful dining room is sumptuous, it sits inside The Hotel on Rivington, a 20-year-old tower now undergoing an apparently long-overdue renovation, which has led to a work-in-progress vibe at the overall site, said Patric Yumul, CEO of the restaurant’s parent, TableOne Hospitality.
“We’ve had a little bit of a challenge,” said Yumul of Kin Gin, the first from-scratch undertaking of his Las Vegas-based company in New York.
But Yumul, a two-decade-plus-long industry veteran, says Kin Gin, whose Japanese name translates to “gold and silver,” can become a precious metal in Cole’s hands.
“She has a great ability to make people feel instantly at ease and at home,” he said, “and to get a team to rally behind her.”
Mount Sinai Hospital is seeking big savings from a federal drug discount program through a planned outpatient cancer clinic on Long Island.
The hospital system is requesting approval from state regulators to build a $9.5 million cancer treatment facility in Nassau County, it said in a certificate-of-need application filed last week to the Department of Health. Mount Sinai is planning to construct the clinic on one floor of an existing building at 2020 Wantagh Ave. near Mount Sinai South Nassau – the system’s only hospital on Long Island.
Despite its proximity to Mount Sinai South Nassau, however, the new clinic will be an offshoot of the health system’s flagship hospital on the Upper East Side. That’s because Mount Sinai Hospital is a member of the 340B Drug Pricing program, a federal initiative that allows hospitals that serve a certain portion of low-income patients to buy their pharmaceuticals at a major discount. Participants in the program purchased $53.7 billion in discounted drugs in 2022, federal data shows.
By building the cancer clinic as an extension of its main hospital, Mount Sinai is seeking to slash drug costs.
A representative from Mount Sinai Hospital did not respond to a request for comment by publication time.
The planned development will provide outpatient cancer treatment to patients that currently get oncology infusions and injections at Mount Sinai South Nassau. It’s expected to have 16 infusion bays and nine exam rooms, as well as an onsite pharmacy to prepare medicines for infusions and other therapies.
Mount Sinai is preparing the new clinic partly to alleviate capacity issues at its South Nassau hospital. The hospital’s hematology and oncology infusion visits have doubled in the past five years, jumping from 4,400 in 2018 to 8,800 by 2023.
Mount Sinai, which brought in $10.8 billion in revenue last year, is the latest city health giant to seek to expand its footprint outside the five boroughs. Health systems including NYU Langone and Northwell have sought to expand their outpatient care clinics in Westchester County and Long Island in an effort to boost revenues from outpatient procedures for patients in need of cancer treatment or certain minimally invasive surgeries.
Mount Sinai has eight hospital campuses in and around the city, as well as more than 400 ambulatory clinic locations. It is planning to close its Lower Manhattan hospital, Mount Sinai Beth Israel, in the coming months.
FASHION SHOW: Northwell Health raised $800,000 for women’s health services and research at a recent fashion show fundraiser, according to an announcement from the health system. The latest fundraising brings the total haul of the Katz Institute for Women’s Health Luncheon and Fashion Event to $14 million to date. Honorees included a Northwell OBGYN and a 12-year-old who raised $17 million for the system’s Breast Cancer Initiative Fund, which helps cover free genetic testing, research, education and advocacy.
DOMESTIC VIOLENCE PREVENTION: The state is partnering with former NFL quarterback Don McPherson and YMCAs across the state on a program aimed at reducing gender-based violence. The partnership will put McPherson’s program to prevent domestic violence, known as Aspire NY, in 140 YMCAs. The approach targets men and boys in local school and community settings with the aim of identifying behavior that leads to violence. The announcement comes a day after Gov. Kathy Hochul unveiled $35 million for domestic violence work in prosecutor’s offices and law enforcement agencies around the state.
TICK CHECK: The state Department of Health is warning New Yorkers of the ongoing risk of tick-borne illnesses continuing into the fall. Ticks can transmit diseases like Lyme, anaplasmosis and other rare pathogens. Anaplasmosis has been found in greater numbers over a wider area upstate in recent years, according to the department. In very rare cases, viral tick-borne diseases can cause encephalitis or meningitis. Powassan encephalitis, an illness that causes those symptoms, is found in 1 to 5 people each year, according to the department.
New York State is taking steps to plug gaps in health coverage for thousands of underinsured residents ahead of open enrollment next month.
More than 117,000 people enrolled in qualified health plans in New York are eligible for enhanced subsidies next year under a recently approved federal waiver. The subsidies, which will reduce health care prices for lower-income New Yorkers who do not qualify for Medicaid and other public options, are valued at $307 million a year, according to the Health Department. The program has been lauded by insurance and hospital industry leaders who expect to see more people enrolling in qualified health plans.
The new waiver allows New York to tap federal funds coming to the state for the Essential Plan and tax credits under the Affordable Care Act. The program is a win-win for New York's health care establishment, reducing the amount individuals pay in co-pays and other cost-sharing with insurance companies, while the companies are reimbursed with federal dollars running through the state.
People who make between 250 and 400% of the federal poverty level – too high to qualify for the Essential Plan, the state’s free option for low-income residents – will be eligible for the subsidies. Patients with diabetes and pregnant or postpartum individuals enrolled in qualified health plans will see their co-pays disappear.
The waiver will encourage more people to enroll in qualified health plans, said Eric Linzer, president of the New York Health Plan Association, which represents insurance companies, in a statement commending the announcement.
The Greater New York Hospital Association, a trade group of hospitals in the tri-state area, supported the waiver as a way of reducing health care costs for patients, said spokesman Brian Conway. The waiver will not have an impact on providers, he said.
The latest approval completes the state’s application to reconfigure coverage through the Affordable Care Act before the November 1 beginning of the open enrollment period for 2025, according to Health Department spokeswoman Danielle De Souza.
Earlier this year, the feds allowed the state to lower the income threshold for the Essential Plan, encompassing another 200,000 individuals, according to the state. New York recently received $10 billion from the federal government to fund the expansion and other initiatives from April through December of this year. It will have to apply again on an annual basis.
Essential Plan expansion and the latest approval are both part of a push from the state to tap federal dollars aimed at addressing social determinants of health. New York is also receiving $7.5 billion under a Medicaid pilot program with a similar mission.
The 2024 elections hold the possibility of dramatic changes for the health insurance sector as the presidential contest between Vice President Kamala Harris and former President Donald Trump reveals very different visions for the future.
Yet the Democrat Harris and the Republican Trump may not act as expected when they confront key issues from the White House. And the outcome of the congressional elections that determine control of the House and Senate will pose different obstacles and opportunities to whoever is the new president.
For the most part, analysts anticipate Harris would build on the policies enacted under President Joe Biden and President Barack Obama, while Trump would pick up where he left off before losing the 2020 election.
During most of the 2024 campaign, health care in general and health coverage specifically have not been central issues, apart from Harris reminding voters that Trump tried repeatedly to end the Affordable Care Act of 2010, including backing a lawsuit late in his term that would have killed the law.
The candidates focused more on bumper sticker sloganeering on costs and access until recently. Harris — and Biden, before he withdrew from the race in July — emphasizes reproductive care and drug prices, while Trump and his Vice President nominee JD Vance mostly deliver generic attacks against the ACA.
The stakes are high for health insurance companies, providers and patients. A Harris victory would mostly maintain the status quo, including a low uninsured rate, billions in tax credit subsidies that drive enrollment and stronger oversight of health care companies, while a Trump win could lead to rollbacks in Medicaid and the health insurance exchanges and to laxer federal regulation.
Harris plans
Of the two candidates, Harris has been more transparent about her intentions for the health care system, whereas Trump conceded during a debate last month that he has only "concepts of a plan" nearly a decade after entering electoral politics, including four years as the president. That created an opening for Harris and brought the issues to the fore.
"Vice President Harris will continue to support the current administration's policies," Susan Feigin Harris, co-head of health care at Norton Rose Fulbright, said during a roundtable discussion her law firm hosted Sept. 22.
As president, Harris would make a major push to renew the enhanced subsidies for low- and middle-income health insurance exchange enrollees that are due to expire at the end of 2025 and likely attempt a fresh effort to reduce the uninsured, especially in the 10 states that did not expand Medicaid eligibility under the ACA.
The Harris campaign has also touted her support for expanding the Medicare prescription drug price negotiations program that debuted under Biden, capping insulin costs at $35 a month and out-of-pocket spending on prescription medicines at $2,000 a year for everyone, as Biden did for Medicare beneficiaries, and relieving medical debt.
Generally, Republicans oppose such policies on ideological grounds and note that they carry large price tags taxpayers would have to cover.
Trump plans
Since the Harris-Trump debate, the former president has provided little in the way of clarification on his intentions. But Vance has elaborated somewhat on what Trump's concepts may be during rally speeches, interviews and his debate on Tuesday against Minnesota Gov. Tim Walz, the Democratic vice presidential nominee.
For example, Vance appeared on NBC News' "Meet the Press" on Sept. 15, and suggested Trump would revive policies from his first term such as lower-quality, short-term health insurance policies and association health plans, as well as shift people with preexisting conditions into high-risk insurance pools.
Health policy analysts and Democrats quickly pointed out that such initiatives haven't worked in the past and tend to disadvantage people with pre-existing conditions. The Harris campaign released a 43-page document harshly criticizing high-risk pools and other health care proposals from the controversial Project 2025 plan created by Trump allies including former officials from his administration.
During the debate Tuesday, Vance demurred on the broader question of Trump's health agenda, saying a detailed plan "wouldn't actually mean anything" because Congress would assert its priorities.
Vance said his points about insurance pools were more about a flexibility from the ACA itself that allows states to create alternative coverage programs, so long as they achieve the same outcomes as the exchanges and expanded Medicaid. During the Trump administration, several states employed these so-called section 1332 waivers to create reinsurance plans that reduced the impact of high-cost patients on insurance pools.
"The reinsurance regulations is what I was talking about," Vance said Tuesday.
With Trump mostly mum and Vance downplaying some of his own comments, Trump's record as president offers a guide to what he might do if he takes office again. Biden undid most of Trump's health care policies but Trump could restore them from the White House.
In addition to efforts to repeal the ACA, which would have led to more than 20 million people losing coverage, Trump took numerous steps to weaken the law. His administration set up parallel markets for cheaper, less comprehensive insurance such as short-term, limited-duration plans, slashed financial support for enrollment counselors, withheld billions of dollars owed to insurance companies covering the lowest-income exchange customers, allowed states to create work requirements for Medicaid beneficiaries and proposed capping Medicaid budgets via block grants.
Trump wouldn't even pursue ACA repeal if he wins, and congressional Republicans have no interest in reopening debates on matters such as high-risk pools, predicted Jennifer Young, a partner at the lobbying firm Tarplin, Downs & Young.
"I think we will continue to have the operation of the status quo, with his focus being instead on things like what happens next with the ACA," Young said during a briefing hosted by the health policy research institution KFF on Tuesday.
"Republicans have been quietly content for the last couple years to see the conversation move elsewhere," said Young, who was an assistant secretary at the Health and Human Services Department under President George W. Bush. "If JD Vance had not said what he had said, would we have been having this conversation as Republicans? No."
Congressional complications
Any policy pushes, however, are complicated by Congress, and who controls it, and by other demands facing the legislature.
In 2025, Congress will confront not just the enhanced exchange subsidies that Democrats want to extend, but the expiration of the tax cuts Trump enacted in 2017, which Republicans want to renew. Another federal debt ceiling fight also looms.
For the most part, Democrats and Republicans are on opposite sides of those issues, making the outcomes easier to predict if one party takes both the House and Senate. Under a divided Congress, the prospects are murkier.
If Republicans sweep, extending the exchange subsidies is not likely and the GOP may even seek to limit eligibility for financial assistance and reestablish Medicaid work requirements, which federal courts and Biden ended. If Democrats win both chambers and Harris is in the White House, renewing the exchange tax credits and possibly expanding coverage will be top priorities.
There are scenarios under a split Congress where Harris would at least get to retain the enhanced exchange tax credit subsidies in exchange for Democratic support of some Trump-era tax cuts, said Chris Jennings, founder of the lobbying firm Jennings Policy Strategies and a former White House adviser under President Bill Clinton.
"There's no situation or dynamic that I know of that a Democratic administration would leave that negotiation table without significantly extending those tax credits," Jennings said during the KFF briefing.
Although Republicans may oppose the ACA and continuing the bigger subsidies, voters feel more warmly about the law than when Trump took office in 2017 — and the GOP is eager to advance the tax policy they support, Jennings said.
"The Republicans have a great desire to extend tax cuts for significant numbers of people, and I have a feeling that this would get more thrown into the tax debate," Jennings said.
This story originally appeared in Modern Healthcare.
Here's what to know about the corruption cloud growing over City Hall, from the initial indictment to the court battle to other federal investigations in Adams' orbit.
During almost three years as the leader of the city’s public school system, Chancellor David Banks has made his mark, setting high standards for student and teacher performance, establishing programs to compensate for learning losses suffered during the pandemic and absorbing some 40,000 children of incoming asylum seekers into the schools.
From my perspective, however, the chancellor’s most important contribution has been to ensure that the education of every student, from grade school through high school, includes awareness of their future career possibilities. Under his leadership, the department forged sustainable partnerships with employers to prepare young New Yorkers for the full range of jobs available in the city and beyond. No prior chancellor has been as determined or as effective in advancing the career prospects of our city's youth.
There are many examples of how Chancellor Banks engaged the city’s businesses and major nonprofit institutions in support of his ambitious goals. One that my organization co-sponsors is Career Discovery Week, where thousands of high school students spend a full day of immersion at one of the city’s great companies. For many, this is their first time inside a corporate office setting and their first interaction with young professionals whose backgrounds they can relate to. The experience is often transformative.
Another example is the chancellor’s investment in the growth and replication of the STEAM (science, technology, engineering, arts and math) Centers in the Brooklyn Navy Yard and the Bronx. In Brooklyn, high school students spend half of the school day learning about key industries, such as cybersecurity and engineering. They gain work experience, secure an industry-based certification, and create a professional network they can carry into their future careers. The Bronx center offers a similar program in partnership with Montefiore hospital to prepare students for professional jobs in health care.
The chancellor’s enthusiasm for work-based learning has been contagious. City Council Member Nantasha Williams is tirelessly advocating to bring a new STEAM Center to Queens, as part of the redevelopment of JFK airport. Her vision is to focus on preparing the largely Black and brown students from the communities surrounding the airport for careers in the aviation industry. The center would seek to achieve the same economic impact as the Brooklyn model, where $1 million has been put into the pockets of students through paid internships and workplace challenges since the school’s inception in 2017.
As a prominent and highly respected educator, Chancellor Banks has been uniquely able to convince parents of color that “vocational” education is not inferior to a college track, but essential for every student’s development, including those who intend to pursue higher education and advanced degrees. In fact, he has incorporated joint programs with the City University of New York into his career readiness strategy.
Significantly, for the first time in my experience, the school system has become a more welcoming environment for employers. Ten years ago, the Partnership for New York City commissioned a pro bono study by PwC to identify the challenges that discourage employers from providing paid internships and other assistance to the city’s more than 1,500 public schools. We discovered that the big obstacle was the Department of Education’s bureaucracy and the time it took to get anything accomplished.
The chancellor has dramatically changed that culture. He has worked closely with the employer-driven New York Jobs CEO Council, led by JPMorgan Chase Chairman and CEO Jamie Dimon, to engage many of the city’s largest employers in support of expanded internships, apprenticeships, teacher training and curriculum development. The industry relationships that the chancellor has championed promise to help students to achieve post-secondary success.
The growing pipeline of well-prepared, home-grown talent that is essential to New York City’s future will be a significant legacy of Chancellor Banks and of Mayor Eric Adams.
The writer is the president and CEO of the Partnership for New York City.
Big pharma companies are making big cuts to make up for declining drug sales and legal settlements draining some New Jersey firms.
Johnson & Johnson, Bayer and Bristol Myers Squibb plan to terminate more than 350 workers by early next year, according to notices filed to New Jersey’s Department of Labor. The layoffs are expected to continue into the early months of 2025.
The cuts follow an ongoing wave of staff reductions at big drug companies. Pharma giants have terminated thousands of employees in 2024 as they try to reduce their losses from declining drug sales, legal costs and an overall need to realign their business strategies in the post-pandemic era.
Johnson & Johnson, based in New Brunswick, is planning to lay off 231 workers in New Jersey by the end of December following challenges with drug sales. The company’s stocks dipped earlier this year as investors feared the impacts of declining sales of the anti-inflammatory drug Stelara, which is set to face lower-price competition in the U.S. and Europe after losing its patent.
The company’s financial performance also took a hit from a spate of consumer lawsuits claiming that its talc-based baby powders caused their cancer. J&J launched its third attempt to file for bankruptcy last month to end the tens of thousands of lawsuits against one of its subsidiaries.
J&J will direct the employees who are laid off to open positions within the company and connect them with other career services, a company spokesperson said. They declined to answer a question about which departments would be impacted by the terminations.
Bayer, which sells the blockbuster blood thinner drug Xarelto, also plans to lay off 57 workers by the end of this year. The company has cut nearly 5% of its workforce in 2024 as part of a restructuring effort launched by CEO Bill Anderson that aims to save $540 million.
The Whippany, New Jersey-based firm has cut 3,200 workers this year, a bulk of which were managerial roles. Anderson also made massive leadership changes when he took the helm last year, slashing its pharmaceutical executive team from 14 people to eight.
Aside from general restructuring efforts, Bayer’s losses stem from the continued impacts of its $63 billion acquisition of the agricultural giant Monsanto in 2018. The deal – deemed disastrous by many – brought with it thousands of individual legal cases claiming that Monsanto’s weed killer Roundup causes cancer.
Nicole Hayes, a spokeswoman for Bayer, said in a statement that the layoffs are driven both by the company’s restructuring effort and to help it offset the costs from the Roundup litigation. She noted that the cuts are intended to position the company for long-term success.
The workforce reductions at Bayer and J&J follow planned layoffs at Bristol Myers Squibb, which said it would cut 79 workers in Lawrenceville, New Jersey a few weeks ago.
Bristol Myers Squibb announced a companywide cost-cutting initiative in April of this year that would slash 2,200 employees. The terminations aim to save the company $1.5 billion in under two years as it faces patent expirations for its blockbuster blood thinner Eliquis and cancer drug Opdivo. Eliquis is also one of the medicines slated for federal price negotiations under the Inflation Reduction Act, which are set to take effect in 2026.
A spokesperson from Bristol Myers Squibb did not respond to a request for comment by publication.
A low-key corner of Brooklyn has seen another high-priced residential sale, as one developer has acquired the home of another.
Joseph Sutton, an executive with retail powerhouse Wharton Properties, purchased 935 E. Ninth St., a single-family home in Midwood, for $9.5 million, according to a deed that appeared in the city register Thursday.
The 4,100-square-foot house, between avenues I and J, went into contract July 25 and closed Oct. 1, the deed shows.
The sellers were Marvin and Barbara Azrak. Marvin Azrak is the managing principal of Maguire Capital Group, a real estate investor and lender that’s active in Sunset Park and other parts of Brooklyn. In 2015 the Azraks bought No. 935 for $2.1 million and then spent a few years turning the shingled, side-gabled house that previously stood there into the brick slate-roofed house that stands on the lot today, according to city Department of Buildings records.
The house does not appear to have been publicly listed, which may not be a surprise in Midwood and next-door Gravesend. The area’s leafy blocks, lined with detached suburban-style houses, are home to a Syrian American community whose members include some of the biggest owners of retail real estate in New York. And those families often sell properties amongst themselves without shopping the listings with the general public.
Indeed, in 2022 Joseph’s father, Wharton founder and billionaire Jeff Sutton, snapped up a home on East Third Street in Gravesend from the members of the Chera family, who control the retail firm Crown Acquisitions, without it ever coming to market. Jeff Sutton paid $14 million for that property, which was considered a record at the time for that part of Brooklyn, generally less in demand than the fancier “brownstone” districts closer to Manhattan.
Joseph Sutton’s deal is somewhat record-setting itself.
According to listings service StreetEasy, which tracks only listed properties and not off-market deals, the transaction was the third-priciest single-family home sale in all of Brooklyn in 2024 but apparently the largest in that section of the borough.
Sutton may have paid far more than his new home is worth. City tax officials say No. 935 has a market value of $1.8 million. Even though those assessments can be half of what properties actually trade for, a $9.5 million price tag seems unusually steep.
Still, a large delta between value and price is not unheard of in a close-knit area where personal ties and business interests can intersect.
In fact, in 2023 Marilyn Sitt, an owner of real estate investment firm Sitt Asset Management, sold a house on nearby Avenue S for a hefty $12 million to textile executive Jack Kassin. That 1,900-square-foot dwelling has a market value of $4.5 million, according to its most recent city assessment.
Wharton has been on a deal-making tear in recent months. After selling two Fifth Avenue sites to fashion house Prada for $822 million, the firm unloaded a similar storefront across the street to Gucci parent Kering for $963 million.
Wharton is keen on smaller sites as well, snapping up 373 Broome St., a mixed-use prewar property in Little Italy, for $12.8 million during the summer, with Joseph Sutton, who handles acquisitions for Wharton, signing the deed. And last year the firm paid $13.5 million for 14 Bedford St., a 21-unit property in Greenwich Village that Wharton has since renovated.
Azrak, who founded Maguire in 2013 and often focuses on distressed sites, has been busy as well, buying about four-dozen condo units for $19 million in Sheepshead Bay in 2023. But the Midtown-based firm and partner Watermark Capital are facing foreclosure after allegedly defaulting on a $45 million loan tied to a massive development site in Sunset Park, according to a lawsuit filed in August.
Azrak and Sutton could not immediately be reached, though their offices were possibly closed for Rosh Hashana.
Sales
Barcelona investor acquires SoHo storefront
Address: 56 Crosby St., Manhattan
Seller: Invesco Real Estate
Buyer: Punta NA Broadway LLC
Sale price: $26.9 million
Asset type: Retail
Developer picks up part of yard behind church in Greenwood Heights
Address: 259 22nd St., Brooklyn
Seller: St. John’s Roman Catholic Church
Buyer: Renovation Group
Sale price: $12 million
Asset type: Development site
Brokers: JLL’s Guthrie Garvin and Brendan Maddigan represented the seller.
6-story, 20-unit Gramercy site with Greek restaurant Eleni’s sells
Address: 151 E. 19th St., Manhattan
Seller: Christine Raymond
Buyer: Santorini Realty Corp.
Sale price: $10.3 million
Asset type: Mixed-use
Financings
Artex Property Management scores mortgage for Jamaica site
Address: 87-67 170th St., Queens
Owner: Joel Retek
Lender: Broadview Capital
Loan amount: $8.9 million
Asset type: Land
A real estate firm run by the widower and the son of 1984 vice presidential candidate Geraldine Ferraro has defaulted on loan payments at a SoHo retail and residential property but is refusing to acknowledge the lender's takeover of the building, a new lawsuit claims.
P. Zaccaro, run by John Zaccaro and John Zaccaro Jr., borrowed $19.4 million from Seattle-based Columbia Pacific Advisors in April 2021 to refinance debt at 68-70 Spring St., according to city records and the lawsuit, which Columbia filed Tuesday. The Zaccaros then took out an additional $17.5 million loan on the property from a different lender, and part of that loan agreement gave Columbia the right to take control of the property if the family fell behind on payments, the suit claims.
The Zaccaros started to be late with their payments in December, a pattern that continued throughout much of 2024, according to the suit. Columbia initially chose not to act but recently exercised its right to take over the building, the suit says.
However, the Zaccaros have essentially ignored and denied that this takeover is happening, according to Columbia's lawsuit. They have refused to give Columbia the keys to the property or provide the firm with any pertinent information about it, and they have tried telling tenants to disregard anything Columbia does, sowing a great deal of confusion about who actually runs the property, the suit claims.
Columbia hired Union Square-based firm XL Real Property Management to take over managing the building, for instance, and said in its lawsuit that the tenants "expressed relief and gratitude at the change in management, citing the unreliability and lack of professionalism" allegedly of the Zaccaros.
But the Zaccaros themselves responded with a cease-and-desist letter demanding XL stop running the building and calling its actions "unwarranted as well as disturbing, invasive and bothersome." The family told tenants they could ignore notices from both Columbia and XL, and multiple tenants said they would put aside their upcoming rent payments, as they are no longer sure who they should actually pay, according to the lawsuit.
Columbia is seeking a judgment from the court declaring that the Zaccaros were properly removed as managers of 68-70 Spring St. and preventing them from continuing to interfere with the property.
Paul Kremer, the attorney for Columbia, declined to comment on the suit. The Zaccaros did not respond to requests for comment by press time.
The Zaccaros' firm was founded by Philip Zaccaro, the elder Zaccaro's father, in 1917. It is based at 218 Lafayette St., right around the corner from 68-70 Spring St.
The family appears to have owned 68-70 Spring St. since at least 1988, according to city records. The retail and residential property stands 5 stories tall and spans about 27,000 square feet, and its apartments have rented for between $11,700 and $24,000 per month, according to data from CoStar and StreetEasy.
The Zaccaro family had worked on renovating the property for years and opened it in late 2021 after dealing with lawsuits, polluted soil and debt. The younger Zaccaro told Crain's at the time that it had been "a very difficult process," but he was confident there was still demand in the city for new apartments.
The elder Zaccaro may be best known as the longtime husband of Ferraro, who passed away in 2011 of blood cancer and made history in 1984 as the country's first female candidate for vice president. His finances became a major issue during the campaign, which Ferraro and Democratic presidential candidate Walter Mondale lost in a landslide to Republicans Ronald Reagan and George H.W. Bush. He pleaded guilty in 1985 to a misdemeanor fraud charge in a $15.5 million real estate deal.
Part of the deal guaranteed that he would not go to prison, and he said at the time he made it to spare his family further attention.
The younger Zaccaro had his own run-in with the law in 1986, when he was arrested for selling cocaine to an undercover Vermont state trooper. He was convicted of the crime in 1988 but pardoned decades later. He also recently served as the mayor of Saltaire Village on Fire Island.
The city has slapped the more-than-30-year-old Elizabeth Street Garden with a 14-day eviction notice to clear out of the Nolita green space in order to finally make good on its nearly decade-old plans to build affordable housing for seniors on the city-owned lot.
The warning comes after New York's top court in June ruled 6-1 in favor of the Department of Housing Preservation and Development in its bid to raze the iconic sculpture garden and build 123 units of housing, about 30% of which would be set aside as below market rate for formerly homeless seniors, in its place.
The proposed 7-story development, known as Haven Green, would also include 6,700 square feet of public open space. It was approved by the City Council in 2019 after snaking its way through the formal land-use review process — nearly 15 years after the garden was first identified by city officials as an opportune lot for much-needed housing. And it was only then that the circa-1991 garden became open to the public. Pennrose was tapped as the lead developer, in partnership with RiseBoro Community Partnership and Habitat for Humanity.
But defenders of the Lower Manhattan park, led by the nonprofit Elizabeth Street Garden, have attempted to thwart the city's plans at every turn — arguing in court that the environmental review its approval rested on was inadequate.
The nonprofit initially won its case to stave off eviction in state Supreme Court in Manhattan but lost at the Appellate Division and then again at the Court of Appeals.
Still, the coalition of park activists, which has gained the support of celebrities such as Robert De Niro, Martin Scorsese and Patti Smith, is not giving up, even with a looming two-week eviction notice, said Norman Siegel, an attorney for the nonprofit. Siegel told Crain's Thursday that defenders of the green space are "disappointed."
He added that they met with members of the Adams administration, including the mayor himself, at the end of August to discuss alternative locations for the proposed apartments and are surveying their next move.
"We've been meeting with them, and we took their suggestions, giving them alternatives in good faith. We're continuing to try to persuade them to pause the eviction," Siegel said. "We contacted the city yesterday, and we need to hear back from them."
For its part, the city does not appear to be backing down and plans to move forward with the eviction within 14 days.
"Today is a step forward for both affordable housing and community green space," said Ilana Maier, a spokeswoman for the Department of Housing Preservation and Development. "Today is an optimistic day. And today we're reaffirming our commitment to solving the homelessness and affordable housing crises even when it's politically challenging."
Miami Dolphins owner Stephen Ross is in advanced talks with private equity firm Ares Management and billionaire Joe Tsai to sell stakes in the NFL team and other assets at a valuation of $8.1 billion, according to people familiar with the transaction.
As part of the agreement, Ares will purchase a 10% stake in the properties, which also include Hard Rock Stadium and F1’s Miami Grand Prix, said the people who asked not to be named because the talks are private. Tsai, the owner of the NBA’s Brooklyn Nets and WNBA’s New York Liberty, will buy 3% through his family office, Blue Pool Capital.
The Dolphins, NFL and Ares declined to comment. Representatives for Tsai, the chairman and co-founder of Chinese e-commerce pioneer Alibaba Group Holding, didn’t immediately respond to a request for comment.
The potential deal could become the NFL’s first private equity transaction after the league changed its ownership rules earlier this year to allow institutional investors. However, the agreement is still being negotiated and may change or fall apart.
Ross, also a billionaire, is targeting the league’s December owners meeting for approval, according to people familiar. Ross and the Dolphins are being advised by BDT & MSD Partners.
In 2008, Ross purchased 50% of the Dolphins, the stadium and its surrounding land from Wayne Huizenga for $550 million. The following year, he acquired control of the assets.
In August, NFL owners voted to allow private equity firms to buy stakes in their franchises, a move expected to attract billions in capital while boosting team valuations that had already been surging. The league wants to approve select deals before the end of the year, both to set a price for valuations and solve some long-term ownership problems.
Four private equity groups have been approved to invest in franchises: Arctos Partners, Ares Management and Sixth Street Partners and a consortium comprised of Ludis, Dynasty Equity, Blackstone, Carlyle Group and CVC Capital Partners. Firms can buy stakes of as much a 10% and will have to hold any investment for six years.
Griffin talks
Ross had been in talks with the Citadel founder and Chief Executive Ken Griffin to buy a stake in these assets earlier this year, but talks fell apart, according to a person familiar with the negotiations.
Ross is committed to keeping the team within his family, according to a person familiar. The real estate developer has made big investments in Florida’s West Palm Beach and is focused on expanding his sports holdings. That includes Relevant Sports Group, an organization leading the efforts to grow soccer in the U.S.
Multiple league sources have said the NFL has been encouraging teams to get deals done for several reasons, including boosting valuations and funding stadium deals. The Buffalo Bills and Philadelphia Eagles have been in talks with PE buyers, Bloomberg reported in September.
Under the league’s rules, Ares would be permitted to buy into five more NFL clubs.
It’s easy to take New York City’s status as the premier destination for young job seekers for granted. Data from Handshake, the college and recent graduate career platform, shows that New York remains the number one location where new graduates are applying for jobs. But these young workers are entering a job market that is increasingly struggling to accommodate them.
There are now nearly 140,000 young New Yorkers who are neither in school nor employed—the majority of whom are from historically underserved communities. Those fortunate enough to find employment often land in roles that hardly allow them to make ends meet in one of the world’s most expensive cities. Data shows that, across the country, nearly half of the millennial and Gen Z workforce are in low-paying frontline roles with little opportunity for growth. In New York, more than one-third of the city’s frontline workers are younger than 34.
The mismatch between New York’s job offerings and the aspirations of its young workforce has left the city’s reputation as the ideal landing spot for budding professionals in a precarious position. About 40 percent of millennials now say they are contemplating leaving New York. As Gen Z rapidly becomes a dominant presence in the workforce, it’s crucial that the city’s businesses work to avoid a similar exodus. They will need to evolve into employers that actively foster environments that align with the values and aspirations of this new generation.
Today’s young workers seek—and deserve—a workplace that prioritizes economic opportunity. They want to work for companies that offer an equitable way into, and up within, quality career pathways. The most diverse generation in U.S. history, Gen Z prefers organizations that uphold their principles and assist in their professional growth. For these workers, compensation extends beyond salary considerations. They desire employment that offers balanced work arrangements, fosters meaningful connections, encourages continuous learning, and embraces technology.
Smart companies have already started to adapt. For example, JPMorgan Chase, which is headquartered in New York, delivers targeted education and training opportunities to its 150,000 U.S. employees—from front-line bank staff to corporate executives. To customize these services for its increasingly younger workforce, the company consulted a broad spectrum of employees to learn more about their daily challenges and preferences in education. These insights enabled JPMorgan Chase to develop technology-driven benefits that resonate with the needs of their digitally savvy workers.
Prioritizing – and acting upon – the perspectives of employees and emphasizing inclusion and a belonging are essential. Gen Z highly values workplaces that respect their workers and where employees can actively shape the world of work around them. To this end, JPMorgan has created several business resource groups where employees can engage, share perspectives, and build networks with workers who share similar experiences and backgrounds. More than half of its workforce across 53 countries participates in these groups.
Meanwhile, Salesforce, another corporate giant with a significant presence in New York, has developed an advocacy and employee listening program called “The Warmline.” This program is designed to assist employees in navigating their careers, foster a sense of belonging, and facilitate meaningful conversations. In one pilot study, Salesforce employees who utilized The Warmline saw a 33 percent greater sales quota attainment rate than those who did not participate.
By 2030, Gen Z will constitute one-third of the U.S. workforce. If New York City intends to remain the top choice for new-career professionals, companies will need to intensify their efforts to not only attract but retain this rapidly expanding demographic. New York’s future as a hub for young talent hinges on its ability to meet this challenge.
Cat Ward is the vice president of Jobs for the Future's employer mobilization practice, leading efforts to engage the private sector in developing and executing strategies that benefit workers, businesses and communities.
New York City Schools Chancellor David Banks will step down on Oct. 16, months earlier than he had previously planned to, City Hall disclosed late Wednesday.
The unexpected move may deepen questions about the reasons for Banks’ departure, which comes after his phones were seized by federal agents amid a corruption probe that has also touched on his brothers, the deputy mayor Philip Banks and consultant Terence Banks; as well as his wife, First Deputy Mayor Sheena Wright.
In September, before the mayor’s criminal indictment, Banks had said he would retire at the end of the year, when he would be succeeded by his deputy, Melissa Aviles-Ramos. City Hall spokeswoman Amaris Cockfield said in a statement on Wednesday, “We have decided to accelerate the start date of Chancellor Aviles-Ramos to Oct 16th so that she can immediately begin executing on her vision for New York City Public Schools.”
Gov. Kathy Hochul, who has the power to remove Adams from office, has held multiple calls with the mayor since his indictment and told him that “We expect changes,” as she told reporters Wednesday. Since those conversations began, Adams’ embattled aide Tim Pearson resigned from the administration.
“She’s going to use her powers to make sure the mayor cleans house and puts a structure in place that gives comfort to the public and [city agency] commissioners,” said one person familiar with the governor’s private campaign.
Neither Banks nor any other official besides Adams has been accused of wrongdoing. Following the Sept. 24 announcement that he would retire, reports emerged that Banks, a veteran educator, had grown frustrated with Adams over issues like budget cuts and a slow-moving plan to ban cell phones in schools.
Cockfield, the City Hall spokeswoman, said Banks’ early departure was meant to ensure that the city’s 900,000 public school students have “the same leadership through as much of the school year as possible, rather than changing chancellors halfway through.”
“We thank Chancellor Banks for his service to the city and nearly one million public school children,” she said.
Speculation has abounded in political circles about the fate of Wright: David Banks’ wife and the mayor’s top deputy. City Hall has said Wright is not leaving, but the administration raised eyebrows by quietly publishing a succession plan last week that lays out what would happen if Wright became unable to perform her duties as first deputy mayor.
Gov. Kathy Hochul signed a package of bills Wednesday to expand health insurance coverage for pregnant people over opposition from insurance industry leaders who say much of that coverage already existed.
Under the new laws, health insurance plans must now enroll pregnant people without charging fees for special enrollment related to pregnancy. The legislation will allow pregnant people to enroll in policies at any time during the year without the risk of incurring a penalty, according to the governor’s office.
Those fees are costly and can deter pregnant people from seeking care at times when the likelihood of health complications is heightened, according to the bill’s sponsors. But representatives of insurance carriers say no such penalties currently exist under state law.
“Very often legislation that is proposed is well meaning but is not necessary because rules currently are in place to ensure people have access to coverage,” said Leslie Moran, senior vice president of the New York Health Plan Association, which represents insurance companies.
The insurance industry opposed the bill as redundant when it came before lawmakers earlier this year, arguing it would extend special enrollment to a group of people that already qualifies for it under existing law. Through the state’s insurance marketplace, pregnant individuals may enroll during a special enrollment period if they have certification from a provider without incurring a penalty, according to a statement from the New York Health Plan Association during the legislative session.
The governor has made a number of other changes to expand insurance coverage to pregnant and postpartum parents. The state budget this year included a provision to eliminate out-of-pocket expenses for some pregnancy-related benefits for low-income residents covered by the Essential Plan, as well as people on other qualified health plans. The budget last year increased postpartum coverage for people enrolled in Medicaid and Child Health Plus, a plan for children offered in New York State.
A second bill signed Wednesday requires commercial insurance plans to cover prescriptions for prenatal vitamins and a third would require coverage for human donor milk in outpatient settings.
Donor milk is a common supplement for parents with difficulty breastfeeding or for single biologically male parents and same-sex couples. It is a regularly prescribed intervention for premature babies and a recent study from the University of Iowa found extremely premature infants who were fed donated breast milk were less than half as likely to develop a life-threatening disease as those fed formula. The new law would remove a requirement that donor milk be covered only during inpatient use, according to Senator Brad Hoylman-Sigal, the bill’s sponsor.
“All parents should be able to give their children the nutrients they need without having to worry about the cost,” said Hoylman-Sigal, who has two children with his husband.
The legislation adds to a number of maternal health victories notched by the governor during budget negotiations this year. Those include granting prenatal leave, incentivizing hospitals to reduce unnecessary C-sections and expanding access to doula services.
RESPIRATORY VIRUS: State health officials are reminding parents to protect infants against respiratory syncytial virus or RSV. The illness is common and can be harmful to children and older adults, according to the Department of Health. Officials are encouraging New Yorkers to use one of two options – either a vaccine for parents to be taken while pregnant, or antibodies for babies after birth – to protect against the virus. Health Commissioner James McDonald issued a standing order allowing pharmacists to administer the vaccine to eligible individuals in August. The virus is spread through contact with droplets from the nose or throat.
SAFE STAFFING: The New York State Nurses Association is continuing to raise alarms about nurse staffing levels at Albany Medical Center. The nurses are seeking information from a report on the hospital’s staffing levels before the 45-day deadline to release the findings. Nurse-to-patient ratios are a point of contention in ongoing contract negotiations between the union and the hospital. NYSNA is also involved in a number of arbitration proceedings with other facilities around the state over compliance with the state’s safe staffing law.
NYU Langone submitted plans for an orthopedic surgery center in Westchester, continuing to build out its footprint outside the five boroughs.
The Midtown-based health giant is planning a $39 million ambulatory orthopedic surgery center in West Harrison, according to a certificate-of-need application filed to the state Department of Health on Tuesday, located on one floor of a commercial building at 4 Westchester Park Drive.
NYU is expanding its network of freestanding facilities outside of Manhattan that can perform procedures such as knee replacements, minimally invasive spine surgeries and bone grafts. Patients of the health system who live in Westchester currently have to come to the city to get orthopedic surgery – a costly ordeal that can in some instances take them three hours, the hospital said in its application.
The planned development will include four operating rooms, a post-surgical recovery area with 12 patient bays, a waiting room and an additional space for consultations and exams.
A representative from NYU Langone declined to answer questions from Crain’s about when the health system expects to complete construction of the new surgery center and how many patients it expects to accommodate. The application is pending approval by state health regulators.
NYU Langone, which brought in $12 billion in total revenue last year, has made significant investments in facilities outside of hospitals. Roughly 60% of NYU’s revenue comes from visits to affiliated physicians offices and ambulatory clinics, driving up the health system’s incentive to grow its outpatient footprint.
The expansion of outpatient care clinics has long been a part of NYU’s growth strategy. Former CFO Daniel Widawsky previously told Crain’s that the health system started investing in ambulatory facilities as early as 2007, and that he thought of NYU as a “large ambulatory system with a couple of hospitals” rather than a large hospital system with a few clinics.
NYU has opened a few outpatient surgical centers in recent years, including an $84 million ambulatory surgery center in Sunset Park. The health system has looked to expand its reach outside of the city and even outside New York state; it announced plans earlier this year to build a $75 million ambulatory clinic in West Palm Beach, Florida.
The health system has six inpatient facilities and more than 300 outpatient locations across the New York City region and Florida.
New York City’s largest hotel industry trade group is dropping its opposition to the bill that would impose a licensing system and new employment restrictions on the city’s hotels — a victory for the labor union that has been pushing it.
The compromise, reached Wednesday by the Hotel Association of New York City and the Hotel and Gaming Trades Council union, mostly keeps the controversial provision that requires hotels to directly employ public-facing workers like front desk staff and housekeepers, rather than subcontracting out those jobs. In a compromise, the subcontracting ban will no longer apply to technical jobs like engineers.
HANYC said it won other changes to the licensing rules that will prevent them from being applied arbitrarily, although full text of the new bill was not yet available Wednesday afternoon.
Vijay Dandapani, president and CEO of the hotel association, said in a statement the new bill “includes modifications that address some of HANYC’s most serious concerns,” adding that his group would “withdraw our objection to the passage of the legislation if these changes remain in place.”
Bill sponsor Julie Menin also agreed to make other technical changes to resolve concerns that the language could affect investors and cause them to run afoul of federal rules governing real estate investment trusts, according information shared by the union, HTC. Menin told Crain’s she hopes to hold a hearing next week.
The compromise did not satisfy some of the other hotel owners who had railed against the bill. While HANYC’s members are largely unionized hotel owners, other trade groups that include non-union hotels, like the American Hotel and Lodging Association, said Wednesday that they remain opposed.
In any case, the legislation now appears on a glide path to passage. It has won support from nearly two-thirds of the 51-member City Council, thanks largely to the powerful influence of HTC. Mayor Eric Adams, historically an ally of HTC, has also hinted at support.
Both sides tried to paint the compromise as a victory — HTC President Rich Maroko called the changes “modest,” while HANYC labeled them “significant.” But the bill’s likely passage is an obvious win for the union, which has long aspired to require hotels to get a license to operate and limit their use of subcontracted work. HTC has pushed versions of the same bill in the council since 2019.
Still, this year’s campaign got off to a rocky start, as Menin was forced to postpone an initial hearing and revise the bill in response to fears that a broader subcontracting ban could shutter restaurants and other businesses that lease space within hotels.
Menin said Wednesday that she was “very pleased” with the deal, adding that the bill “protects hotel guests, workers and the broader community.”
The bill’s supporters have framed it from the start as a modest attempt to improve safety at hotels, responding to rising consumer complaints and the risk of human trafficking. Other provisions would require hotels to maintain some kind of continuous front desk or security presence, hire a certain number of security guards, create “panic buttons” for employees to press when they spot danger, and meet certain cleanliness standards for guest rooms.
Menin, who represents the Upper East Side, is also widely expected to run for City Council speaker in 2026, a contest in which labor support can be crucial. Although she has closely allied with HTC in shepherding the licensing bill, she has denied that securing the union’s support was a factor in her decision to sponsor the measure.
Kevin Carey, the interim president and CEO of the American Hotel and Lodging Association, argued in a statement that the new bill “still contains language that will cause significant economic harm — primarily to small, family-owned hotels and the largely immigrant and minority-owned businesses that support them.”
“There is no question that this bill, if passed, will cause many of New York City’s small businesses to close and thousands of hard-working New Yorkers to lose their jobs,” Carey said.
Maroko, HTC’s president, said that the bill “will achieve its intended goals of protecting hotel workers, guests and neighbors, while also promoting a thriving hotel sector in New York City.”
Move over cash buyers. A higher percentage of house hunters are using mortgages to fund purchases in Manhattan’s market, driving sales up for a second straight quarter.
Closings of co-ops and condos climbed 6.7% in the three months through September compared with the previous quarter, according to appraiser Miller Samuel and brokerage Douglas Elliman Real Estate. The percentage of those sales that were done in cash fell to the lowest share in nearly two years as mortgage rates eased ahead of the Federal Reserve’s rate cut in September.
It’s a sign that “lower rates and better financial markets” are luring buyers using loans to pay for deals, said Jonathan Miller, president of Miller Samuel.
“This isn’t an all-or-nothing situation where rates reach a certain threshold and the floodgates open and everyone is back in the market,” Miller said. “But cash buyers aren’t as dominant as they were, meaning finance buyers might be coming back.”
While Manhattan sales in the third quarter were down from a year earlier — Miller called transaction activity “tepid” — there’s signs that lower borrowing costs are starting to stoke more deals. In September, new signed contracts to buy Manhattan condos surged nearly 75% from the same month a year earlier, while contracts on Brooklyn condos rose 12%.
For the co-op market in Manhattan, contracts to buy those units dropped 8% in September from the same month a year earlier. That was driven by a pullback in buyer activity around more expensive listings.
Brokerage Coldwell Banker Warburg said demand for co-ops has been hurt by the “almost universal need” for renovation.
“Very few buyers have the time and/or patience to remodel an apartment,” according to the firm’s report. “Those that do expect a big price discount, which sellers often feel reluctant to give.”
It’s a different story for more affordable co-ops. Contracts for Manhattan co-ops priced between $500,000 and just under $1 million increased 43% in September from the same period a year earlier, according to the Miller Samuel and Douglas Elliman report. That spike is the largest annual increase in three years, according to Miller.
Co-ops in that price range in Brooklyn posted an even bigger bump in contracts, surging 133% in September.
“The increase in sub-$1 million contracts is indicative of first-time buyers being sucked back in,” Miller said.
Independent lab companies have continued their transaction spree in 2024, either by forming partnerships with hospitals and health systems or by outright acquiring some of their lab assets.
Quest Diagnostics has announced seven acquisitions this year, including its recent purchase of select lab assets from Minneapolis-based Allina Health. Slated to close later this year are deals with OhioHealth in Columbus and University Hospitals in Cleveland.
Meanwhile, Labcorp has closed three acquisitions this year, with Springfield, Massachusetts-based Baystate Health, Renton, Washington-based Providence Health and Services and Naples, Florida-based NCH Healthcare System. It recently announced plans to acquire the lab assets of Johnson City, Tennessee-based Ballad Health in a deal expected to close in December.
Here’s what to know about the consolidation underway as providers negotiate transactions with independent lab companies.
Why are lab companies on the lookout for deals?
Both Quest and Labcorp are looking to grow by finding hospital and health system partners, primarily in markets where the number of independent physicians is dwindling.
“In order to grow our business, we want to be able to do more work with hospitals that are doing outpatient or outreach lab tests ordered by independent physicians outside of their facility,” said Jim Davis, president and CEO of Quest Diagnostics. “If we go into a market, such as where we're doing this work, the characteristic of each marketplace is that there's not many independent physicians. Most of the primary care and obstetrics and gynecological physicians are employed by a health system."
Bryan Vaughn, Labcorp's senior vice president of health systems, said the move to expand began during the COVID-19 pandemic and has continued.
“There really was a spotlight put on [independent] labs because testing for COVID-19 was such an important issue and all health systems realized the importance of their laboratories or their laboratory partnerships to have access to testing,” Vaughn said. “But if you fast forward to now, health care costs just continue to go up, so finding ways to sustainably lower costs to make things more accessible for patients is just hard to do. These laboratory partnerships are a tangible way to achieve cost savings and health access and equity without sacrificing things.”
Why are hospitals selling some lab assets?
The transactions benefit providers in a few ways. It helps them reallocate financial resources from back-end operations to clinical care delivery. Also, health systems are rapidly opening ambulatory care facilities and the partnerships can mean offering access to lab testing without the upfront investment.
Separately, the pace of technological advancements in lab testing and services is quickening, and keeping up with it could become a financial drain on a hospital.
How will this affect patients?
Ideally, the partnerships and expansion could mean greater access to testing and shorter wait times and potentially lower copayments for tests done by an independent lab.
OhioHealth, which in July agreed to sell select outreach lab assets to Quest, said both the healthcare system and its patients will benefit.
“Quest has the size, infrastructure and capabilities to achieve economies of scale and drive competitive price points to achieve lower costs, which will benefit our patients,” the health system said in a statement. “National labs, like Quest, also have significant product offerings and have the capacity to manage a high volume of tests. “
How do the deals affect insurers?
Insurers like the cost efficiency, which is largely due to independent labs’ ability to focus solely on testing and the scale of their operations, said Courtney Midanek, managing director of Kaufman Hall.
“There's so much fixed cost related to these labs, that, if you can imagine, you're doing 10 million tests today. Now you're going to do 12 million because you bought 2 million from [a health system.] You don't really have to add that much cost to do that," Midanek said.
Some insurers, seeking to avoid the higher costs associated with working with hospitals, are pushing patients and providers to work with labs, said Brad Ellis, Fitch Ratings' senior marketing director of North America insurance ratings. "There's a lot of situations [where] they incentivize patients to go to these individual labs to have tests done that don't have to be done at the hospital," he said.
How have these transactions worked out?
The rollouts have not been without obstacles that have included the availability of tests, length of time to get results and trouble entering or ordering labs in electronic health record systems.
“The anecdote that I often hear is health systems that have a lot of this business in-house, they deliver on turnaround time,” said Kaufman Hall's Midanek “You go in for your annual checkup, and they draw your blood at 10 a.m. and you get your results back at 5 p.m. Under [these labs] they're going to be shipping these samples to some of their large labs, and maybe you won't get your results until 8 a.m."
Some employees at Allina Health have complained the system's recent transition to Quest has caused multiple problems.
In separate statements, Allina and Quest said while the rollout has not gone as smoothly as planned, the two organizations have been working to fix issues, including by adding more Quest employees in labs and improving the IT systems used to order tests.
What's next?
The general sentiment is the consolidation is expected to continue, given the potential financial benefits for providers, patients and payers. “[It] seems like there's a fair amount of these outreach assets that could be acquired," said Fitch Ratings' Ellis.
This article originally appeared in Modern Healthcare.
A global coworking company has signed a massive lease to take over six floors of Manhattan's Metropolitan Tower, Crain's has learned.
The Switzerland-headquartered International Workplace Group inked a deal for 93,400 square feet in the Billionaires Row skyscraper at 142 W. 57th St.
Financial District-based real estate firm GDS Development teamed up with Sabal Investment Holdings, which is headquartered in California, to take over the 18-story office portion of the building last year.
The 77-story mixed-use tower between Sixth and Seventh avenues was built in 1986 and contains 235 residential apartments as well as 283,000 square feet of office space, of which 75% is now occupied, said Elizabeth Kubany, a representative for GDS.
It's unclear how much the International Workplace Group is paying for the space or how long its lease is for. Kubany declined to provide the terms of the lease agreement, but nearby office space on West 57th Street ranges between $48 and $80 per square foot, according to LoopNet.
The flexible workspace company, which will operate in the Plaza District under its creative brand name Spaces, has more than 1,500 centers across the country in all 50 states and more than 4,000 locations worldwide. In the first half of this year, International Workplace Group signed 465 new partner locations.
Founded in 2007, GDS has delivered on $5 billion in real estate assets throughout the five boroughs. Its portfolio includes 1245 Broadway and 205 W. 28th St. For its part, Sabal manages more than $1.4 billion in assets nationwide, the company said.
International Workplace Group's massive lease signing comes at an interesting time for office — and especially coworking — space. WeWork filed for Chapter 11 bankruptcy protection in November 2023, listing nearly $19 billion in debt. The former Adam Neumann-led company managed to emerge from bankruptcy with a reorganization plan that was recently approved by U.S. bankruptcy Judge John Sherwood.
Meanwhile, other office buildings are being converted into housing to account for the decline of in-office workers compared to the limited housing supply. One of those is 419 Park Ave. South — a once large WeWork location that will be converted into residential condos.
Mark Dixon, founder and chief executive officer of IWG, however, remains undeterred and believes in the need for flexible office space as "demand for hybrid working solutions in New York City continues."
As developer RFR Holding struggles to hang on to the ailing Chrysler Building and other troubled properties, co-founder Michael Fuchs appears to be liquidating his own portfolio.
A few months after listing a townhouse at 144 Waverly Place in Greenwich Village, for which he’s expected to take a loss, Fuchs has put a similar property, 59 Morton St., a 6,700-square-foot prewar brick building near Hudson St., on the market.
The townhouse, a 5-story, 25-foot-wide building that appears to be functioning as a five-unit rental and not Fuchs’ own home, is listed for about $15 million, according to a post that appeared Tuesday.
Fuchs apparently paid $8.3 million for the site in 2019, according to the city register. Officially the buyer on the deed is MF Townhouse LLC, as in Fuchs’ initials. "MF" also shows up on deeds for other residential transactions linked to the developer. Plus, Rich Froom, an in-house attorney at RFR, signed the deed, as Froom has done for other executives at the privately held, Midtown-based firm.
Located in a historic district, the Federal-style 59 Morton features five apartments, one on each floor, according to its floor plan. In 2023 the garden-level one-bedroom unit, which has direct access to a brick-lined backyard, was on the market for $6,300 a month, according to StreetEasy, while the parlor-level one-bedroom one floor above it was available the same year for $8,000 a month.
That the ad for 59 Morton has a dearth of interior photos suggests tenants currently occupy several of the units, making access complicated.
Fuchs also owns a third property in the neighborhood, a two-bedroom condo on West 12th Street that he bought with his now ex-wife, Alvina Collardeau, in 2018. That unit does not appear to be for sale, at least not publicly.
Co-founded in 1991 by German childhood friends Fuchs and Aby Rosen, RFR has over the past three decades become one of the city’s splashiest developers. In addition to Art Deco jewel the Chrysler Building, which RFR is at risk of surrendering after missing months of rent payments to landowner Cooper Union, the firm controls the landmarked Seagram Building, which SL Green Realty is expected to try to acquire next year if RFR has trouble refinancing its significant debt.
In recent months, RFR has also faced lawsuits from lenders and city officials for missed loan and tax payments at lower-profile sites across the city, such as 17 State St., 90 Fifth Ave. and the retail portion of 122 Greenwich Ave., a mid-2000s RFR condo project.
But if raising capital is a sudden priority, RFR did notch one recent major success last summer, when it sold the office building 980 Madison Ave. to a nonprofit with ties to former Mayor Michael Bloomberg for a hefty $560 million.
And for his part, Fuchs will soon likely be more capitalized himself. The 114 Waverly townhouse, a multiunit rental that also appears to be an investment property, is in contract to be sold as of August, according to StreetEasy. It won’t be clear what the buyer paid until the transaction closes. But Fuchs had been asking $8.9 million for the home, less than the $9.2 million the building cost, so he likely will incur a loss.
As their empire wobbles, Rosen and Fuchs have become estranged, according to multiple industry sources, and Rosen alone now handles most of the day-to-day running of the firm.
Fuchs, who finalized his divorce in 2022 with a reported $44 million judgment, currently appears to be a resident of Florida, where home is a Miami Beach apartment, court filings show.
Sheldon Werdiger, an RFR spokesman, had no comment by press time. And Christopher Riccio, the Douglas Elliman agent marketing 59 Morton and who also listed 144 Waverly, did not return an email.
New York Mayor Eric Adams may be charged with further counts in his corruption case, prosecutors said, adding it was “quite likely” other defendants may be named.
The U.S. told a federal judge of those prospects Wednesday morning as Adams appeared in a Manhattan courtroom for the second time in a week. They said further counts for the mayor were “possible,” and that its case would include “multiple witnesses.”
Adams was indicted last week, the first sitting New York mayor to face federal felony charges, amid a widespread criminal probe in which top City Hall aides have had their homes searched and phones seized by investigators. The next day, he pleaded not guilty and was freed without bail.
Since then the mayor has rolled out an aggressive defense to corruption charges that threaten to bring down the administration of the largest US city. He has denied the charges, resisted calls to step down and shown he intends to fight back. His lawyer has blasted federal prosecutors for allegedly leaking details of the case to the press and is demanding a speedy trial.
Prosecutors claim Adams began accepting improper benefits, including luxury travel from wealthy Turkish businesspeople, when he was Brooklyn borough president before running for mayor. He is also accused of secretly accepting illegal foreign contributions and defrauding taxpayers out of matching funds for his 2021 mayoral campaign.
He was summoned to appear Wednesday for an initial pretrial conference in the case. Such proceedings are an opportunity for the parties and judge to discuss scheduling, possible legal motions and the exchange of evidence, all with an eye toward moving the case toward trial.
Alex Spiro, the mayor’s lawyer, asked US District Judge Dale Ho, a Biden appointee who took the bench in August 2023, for a speedy trial.
“We do not want this case dragging,” Spiro said.
At one point he objected to the government’s answers to questions about the pretrial exchange of information in the case.
“They have a weak case, I get this,” he said, but the U.S. was making “a long opening statement about what the witnesses are going to say,” which Spiro said was mostly “misleading and false.”
Prosecutors said evidence against Adams will include business records that are typical for white collar cases but also will include items specific to the case, such as records from a Turkish airline showing he didn’t pay for $50,000 of flights he took in 2017. It will also include government papers and electronic records such as GPS data, photographs and voice memos.
Spiro has taken the unusual step of asking the judge to dismiss part of the case right away. On Monday he filed a motion to dismiss a criminal count of federal program bribery, arguing that a series of Supreme Court rulings in recent years makes the charge untenable. He held a press conference minimizing the allegations and vowing to seek dismissal of the four other charges as well, which he says appear to be based on the word of a staffer with an ax to grind.
Convincing a judge to dismiss charges at this early stage requires showing that even if the government’s allegations are true, they don’t add up to a crime.
Then, on Tuesday, Spiro filed a motion for a court hearing and sanctions against the government for alleged leaks.
“For nearly a year, the government has leaked grand jury material and other sensitive information to the media to aggrandize itself, further its investigation and unfairly prejudice the defendant, Mayor Eric Adams,” he said in the court filing. Spiro said the judge should “remedy the government’s brazen violations of the rules governing grand jury secrecy,” possibly including dismissal of the indictment or suppressing some evidence.
Manhattan's office market enjoyed a fairly strong third quarter even as a full recovery from its pandemic woes remains tenuous.
Companies leased about 8.6 million square feet overall, up 5.6% quarter over quarter and the strongest quarterly volume for the borough in two years, according to the latest data from Colliers. This was higher than its five- and 10-year quarterly rolling averages as well.
Firms have now leased about 23.1 million square feet in Manhattan for the year, putting 2024 on pace to surpass 2023 and 2022 but still fall behind 2019 by almost 30%, the report says.
The largest deal for the quarter was Blackstone extending and expanding to more than 1 million square feet at 345 Park Ave., followed by Christie's renewing about 373,000 square feet at Rockefeller Center and Willkie Farr & Gallagher renewing and expanding to about 316,000 square feet at 767 Seventh Ave. Ares Management renewing and expanding to about 307,000 square feet at 245 Park Ave. and Google renewing 297,000 square feet at 85 10th Ave. rounded out the top five.
Leasing by finance, insurance and real estate firms made up the largest share of activity, at 46%, followed by the technology, advertising, media and information services sector at 16%, the report says.
The average asking rent, however, dropped for the fifth quarter in a row, to $74.07 per square foot, 6.8% lower than the March 2020 average of $79.47 per square foot. The borough's availability rate was 17.3%, its tightest in 18 months. The total amount of available office space was 93.1 million square feet, up 72.9% since the pandemic began, but net absorption last quarter was about 3.6 million square feet, meaning more office space was leased up than arrived on the market.
"The available supply has tightened measurably — especially the prime options — since last September thanks to a combination of stronger tenant demand and the planned conversion of several million square feet of available space," Colliers Executive Managing Director Frank Wallach said in a statement. "But there is no question that these trends will need to continue for the foreseeable future before the market finally reaches the elusive recovery status."
Leasing in Midtown specifically increased to about 5 million square feet last quarter, higher than its five- and 10-year rolling quarterly averages, and the neighborhood was home to seven of the 10 largest deals. Its average asking rent fell slightly, to $78.56 per square foot, while its availability rate tightened to 15.5%, the report says.
Firms leased about 2.9 million square feet in Midtown South, down quarter over quarter but up year over year and ahead of the neighborhood's five- and 10-year averages. Google's lease led the way, followed by Yeshiva University taking 160,000 square feet at 1293 Broadway. The average asking rent was $79.87 per square foot, up slightly quarter over quarter and down slightly year over year, while the availability rate fell to 18%, according to the report.
Downtown, companies took about 680,000 square feet of space, led by StubHub subleasing 103,000 square feet at 4 World Trade Center and Catholic Charities of New York renewing and expanding to about 77,000 square feet at 80 Maiden Lane. This was up slightly quarter over quarter but down sharply year over year. The average asking rent fell to $56.91 per square foot, its lowest since August 2015, while its availability rate fell to 20%, the report says.
Leases
Acme Smoked Fish inks Wythe Avenue lease
Address: 1 Wythe Ave., Brooklyn
Landlord: 1 Wythe LLC
Tenant: Acme Smoked Fish
Lease size: 18,000 square feet
Lease length: 10 years
Asking rent: $80 per square foot
Asset type: Office
Brokers: Verada's Nate Mallon represented the tenant.
Engineering lease helps bring Midtown South tower to full occupancy
Address: 21 W. 38th St., Manhattan
Landlord: Brause Realty
Tenant: Partner Engineering & Science
Lease size: 4,465 square feet
Asset type: Office
Brokers: A Lee & Associates NYC team led by Todd Korren represented the landlord.
Sales
Google merchandise store site trades in Williamsburg
Address: 134 N. Sixth St., Brooklyn
Seller: L3 Capital
Buyer: Empire State Realty Trust
Sale price: $28.2 million
Asset type: Retail
British financial firm buys five-apartment SoHo property
Address: 43 Crosby St., Manhattan
Seller: Squire Investments
Buyer: BNF Capital
Sale price: $20.8 million
Asset type: Mixed use
Financings
Brooklyn firms lands loan for Mott Haven projects
Addresses: 261 and 315 Grand Concourse, 270 Walton Ave., Bronx
Owner: Beitel Group
Lender: Scale Lending
Loan amount: $84 million
Asset type: Mixed use
Just one year after lawmakers succeeded in adding needed restrictions to New York City’s short-term rental market, the same special interests that sought to eliminate jobs and housing for profit are back. Now, Airbnb and other similar companies are trying to make the case that higher hotel costs over the last year are caused by the legislation, and that is reason to go backward and repeal the city’s law.
There’s only one problem with their argument: basic economics.
The short-term rental companies claim hotel prices have gone up because fewer visitors can rent their rooms in private buildings. In reality, the managing boards of many private buildings have already banned short-term rentals for security concerns, significantly limiting the number of rooms Airbnb and others can add to the market. And that small amount would not have enough of an impact on supply to drive down prices by satisfying increasing demand.
Instead, by far the most significant reason for the low supply of available rooms in New York is the hotel industry’s commitment to helping alleviate the migrant crisis. Nearly 20 percent of hotel rooms in the city are being used to house asylum seekers and others from our overloaded shelter system. With supply down that much and tourism back to pre-Covid levels, it is no wonder prices are higher. Reversing the short-term rental law will not affect that.
In fact, a report out this month by AirDNA, a market research firm, stated that recently “short-term rental prices increased nearly 20%.” Quite evidently the rooms provided by Airbnb are not a cheap option.
At the same time, the average monthly rent on regular apartments has also skyrocketed post-Covid. Repealing the new short-term rental rules would almost certainly exacerbate that problem and lower our already razor-thin 1.4 percent city-wide home vacancy rate by removing units from the general market and effectively turning them into businesses.
We can’t forget why the city decided to step in and regulate short-term rentals in the first place — and why a return to the lawless market would be a disaster for New Yorkers.
Local Law 18, which city lawmakers enacted in 2022, was passed explicitly to shut down the regulatory arbitrage exploited by short-term rental platforms. Airbnb and other companies provided little oversight of their users, leading nearly 14,000 New Yorkers to file complaints about unsafe and illegal conduct happening in short-term rentals in their buildings.
The companies also provided an opportunity for wealthy New Yorkers and other opportunistic commercial operators to buy up properties and price residents out of their own neighborhoods — shrinking the housing supply even further and turning residential homes into makeshift hotels. Unlike hotels, Airbnb diverted millions in taxes that visitors would have provided to the city — which then went straight into the companies’ pockets. At the same time, thousands of hotel workers’ jobs were put at risk.
Despite Airbnb's promises, short-term rentals are a decidedly worse alternative to the hotel industry. New York’s hotels are safe, heavily regulated and contribute to the city’s financial health. Airbnb is none of the above.
The company made millions off of New Yorkers while it claimed to help the average homeowner. They were wrong then, and their effort to repeal legislation banning them would only hurt New Yorkers again.
So how do we lower hotel costs to ensure we maximize our economic potential as a tourist destination? Lower taxes. New York hotels pay double the property tax paid in other major markets, which is reflected in room costs. The city also has continually raised the hotel occupancy tax that visitors pay to 5.875%, which is now also the highest in the country. Additionally, visitors pay state and city sales taxes of 8.5% as well as a $2 “room tax” convention center fee of $1.50 per room per day.
If the city lowered these rates, it would lower prices for our guests and make New York much more competitive in the global tourism market. That would also mean more jobs for New Yorkers and a better overall economy for our city. Even tax revenue would likely increase because as many more rooms would be occupied.
Supporting our hotel industry is by far the best option for making New York affordable to visitors and New Yorkers. Let’s invest in that future for our tourism industry and not revert to the past we rightly left behind.
Vijay Dandapani is the president and CEO of the Hotel Association of New York City.
Goldman Sachs employees will soon have one fewer place to eat near their office.
Blue Smoke Battery Park City, a barbecue joint near the investment bank's Lower Manhattan headquarters that Goldman enlisted as an amenity for workers, will close by the end of the year, according to a new unemployment filing.
An offering from Danny Meyer’s Union Square Hospitality Group, Blue Smoke, located at 255 Vesey St., will turn off the grill Dec. 21 and let go of all 39 employees, according to a worker adjustment and retraining notification filing made public Monday. WARN notices are required of large employers to give workers time to find new jobs.
With its closure, Manhattan will no longer have any branches of Blue Smoke, once among Meyer’s most popular eateries. The first and only other version, which opened in 2002 on East 27th Street in the Flatiron District, smoked its last brisket in 2020 as Covid raged.
Both cases seem to be a consequence of the Covid economy.
"As the restaurant industry grappled with pandemic challenges, shifting lifestyles and increasing operational costs, Blue Smoke was unable to support the ever-evolving demands on its business," said Union Square spokeswoman Ally Langston, adding that the company will offer employees opportunities to explore other roles within the company.
In 2006, while in construction on its new $2.1 billion offices at 200 West St., Goldman snapped up the next-door Embassy Suites hotel, paying Forest City Ratner $223 million for the 450-room property, according to the city register.
After an upscale renovation, the hotel was reborn as the Hilton-operated Conrad New York Downtown. In a related deal, the bank paid Forest City $70 million for the hotel’s half-dozen ground-level retail spaces, which are technically part of a separate commercial condo, the register shows, and began switching out existing fast-casual chains such as Applebee’s for higher-end food tenants.
The investment bank also added a roof over a pedestrian passageway between the hotel and offices so workers could apparently duck out for sustenance during rainstorms without ruining their suits. The strip quickly became known as Goldman Alley.
Blue Smoke opened in one of the hotel's storefronts in 2012, three years after Goldman relocated across the alley. The same year, Meyer also opened a second restaurant, the French-inflected fine-dining establishment North End Grill, which closed in 2018 after a six-year run. In addition, Meyer installed an outpost of burger-and-fries chain Shake Shack, which is still there.
Other Goldman Alley offerings include Mexican eatery El Vez and Burrito Bar and gluten-free favorite Friedmans.
There's also Harry’s Italian, a branch of the Wall Street-based Harry’s restaurant group that's owned by the Poulakakos family and that arrived in 2012. Although it has appeared closed in recent weeks, the restaurant is instead undergoing a renovation and will reopen, according to a source familiar with the situation. The Poulakakoses also feed financial executives at Anassa Taverna Downtown, a Greek eatery that took over the former North End Grill space in 2022.
Goldman spokeswoman Abbey Collins said her company would announce a replacement tenant for Blue Smoke in the next few months.
One of the most celebrated and successful modern restaurant owners in New York, Meyer has seen other eateries shutter in recent months. In 2023 his Marta and Maialino both closed after their site, NoMad’s Redbury New York hotel, began functioning as a migrant shelter.
Meyer stepped down as the CEO of Union Square in 2022 and now serves as executive chairman of the company.
A long-delayed $16 billion rail tunnel project bridging New York City and New Jersey just scored its final piece of federal funding.
The Federal Railroad Administration provided the Gateway Development Commission’s program with $3.8 billion in aid — the last portion of a $12 billion federal contribution granted to the Hudson Tunnel project, according to a statement seen by Bloomberg. About $1.9 billion of the grant will be available immediately.
The project is meant to ease congestion underneath the Hudson River by adding a new tunnel and making upgrades to the current rail tunnel, which is more than 100 years old. The new tunnel is expected to be in service by 2035 and the full rehabilitation of the existing tunnel will be complete by 2038.
“With this dramatic infusion of immediately available cash, GDC is well-prepared to execute the next phase of major construction,” GDC Chief Executive Kris Kolluri said in a statement, adding the commission is planning to start tunnel boring this year.
GDC now has $2.7 billion in grant funds immediately ready to deploy for construction on the Hudson Tunnel Project, thanks to $800 million in other grants.
The project’s sponsors, which had been rushing to get a full funding agreement in place ahead of the November presidential election, closed it in July. Politics have derailed the effort in the past. In 2010, former New Jersey Gov. Chris Christie canceled the project, saying the state couldn’t afford it. The Gateway project was proposed a year later but eventually stalled under the Trump administration.
“After many false starts and obstacles placed in our way, Gateway is full speed ahead with billions from FTA ready to go and be used for critical work and construction,” Senate Majority Leader Chuck Schumer said in a statement. “Gateway’s future is assured and the most important public works project in America is all systems go.”
In 2011, Barbara and Lou Grumet bought a two-bedroom co-op for $775,000 at 100 W. 57th St., leaving behind their house in Riverdale for a fully accessible apartment close to Mount Sinai West, Weill Cornell Medical Center and NYU Langone Health.
“We use all three hospitals,” said Barbara, a retired dean at Long Island University’s Westchester campus who is 80 years old and uses a wheelchair. “We also like going to Broadway shows,” said Lou, also 80, who uses a cane.
But the golden years for these grandparents are under threat by something happening in the dirt below them, something that could force them to move out in as little as six months. That something is a ground lease. In a ground lease, the land underneath has a different owner than the building above.
These leases are common in commercial real estate. The office tower at 40 Wall St. owned by Donald Trump has one, and last week the ground lease for the Chrysler Building was terminated by Cooper Union after troubled operator RFR Holding defaulted on $21 million in rent payments. Ground leases were rare for apartments until the 1980s but became more popular after a court-ordered policy change. Today, residents are paying the price as ground leaseholders seek to dramatically raise rents to reflect soaring values for New York housing.
At the Grumets’ co-op, called Carnegie House and located across from Billionaires Row on 57th Street, the ground lease resets March 14. The new holders, which own several Manhattan office buildings, have proposed to raise the rent to $25 million a year from $4 million. Residents say such a drastic rent increase will bankrupt their building. They have offered to pay $5.6 million a year.
“We’re not billionaires, we’re thousand-aires,” said Richard Hirsch, president of the 324-unit building where, like in all co-ops, residents own shares in a housing corporation and divide the operating costs. “We are the tip of a spear that’s coming straight for co-ops across the city.”
There are between 65 and 100 co-ops with a ground lease in and around the city, housing up to 25,000 people, according to estimates from the Real Estate Board of New York and the Ground Lease Co-op Coalition. Residents in these buildings occupy a special place in the Byzantine world of New York real estate, as they are both homeowners and renters at the same time.
If Carnegie House residents are unable to agree on new lease terms and default, the ground-lease owners would seize control of their building, homeowners would lose all their equity and have to pay off the balance on their mortgage immediately. If they have any money left over after that, they would be eligible to lease their apartment at a stabilized rent, meaning the cost could rise only by levels prescribed by the city. However, the initial rent could be set at an unaffordable price for many residents, said Stuart Saft, a ground-lease expert at law firm Holland & Knight.
“That,” he said, “is the problem.”
The Grumets have no idea where they’d go if they can’t afford to stay in Carnegie House. Affordable housing is scant everywhere, and they’d like to stay close to their doctors.
“We’re not wealthy people,” said Barbara. Lou, a former executive director of the New York State School Boards Association, looked at his wife of 56 years and said: “I assure you we wouldn’t go quietly.”
Carnegie Houses’s ground lease is owned by billionaire real estate investor Rubin Schron and partner David Werner. They bought it 10 years ago for $315 million from the previous owner who’d held it for at least 60 years. As they see it, the co-op is a housing corporation whose ground rent is priced far below market value, which has soared since the supertall towers of West 57th Street rose across the way from the 21-story co-op developed in 1960. The partners want the new rent determined by an arbitrator and have offered each tenant a 10% discount if the sum exceeds $25 million a year. They’ve also offered to extend the lease’s remaining term to 62 years from 43.
“They’re living practically rent-free on Billionaires Row,” said Schron, who co-owns the Woolworth Building. “There are multi-millionaires in the building, there are investors. It’s not just middle class.”
Asked if $25 million is a fair price for ground rent, Schron said: “Maybe they’ll appraise it at $20 million. Maybe 25 or $26 million.”
Carnegie House residents are fighting back. They’ve found powerful allies in the state Legislature, and this month filed a lawsuit against the ground-lease owners and the New York state Division of Homes and Community Renewal, which oversees rent-stabilized housing. The lawsuit could buy co-op residents some time to negotiate a new lease.
“The situation at Carnegie House reveals a clear hole in our housing-protection laws,” said state Sen. Liz Krueger. “It isn’t about just this building, but bigger issues we have to confront.”
Wanting bigger returns
Ground leases date back to at least 1928, when Columbia University rented its land to Rockefeller Center.
Typically the leases last from 50 to 99 years, and the rent resets about every 25 years. The leases produce a steady stream of cash for holders who collect a monthly check.
“Ground leases are a way for wealthy parties to maintain the real estate they own,” Saft said.
Traditionally landlords didn’t get rich from ground leases, which typically generate investment returns of about 3% a year. But they are attractive investments because leaseholders didn’t have to pay for a building’s upkeep or property taxes.
“It was like owning a Treasury bond,” Hirsch said. “Until investors decided they wanted Nvidia.”
A marketing presentation from CBRE a decade ago showed ground leases could produce returns akin to a super-hot AI-chip maker. At the time, Carnegie House’s ground lease was being sold by the estate of Evelyn Sharp, mother of Peter Jay Sharp, developer of 450 Park Ave., former owner of the Carlyle Hotel and ground-lease holder who died in 1992. Symphony Space’s theater on the Upper West Side is named for him.
CBRE’s “base case” was that the ground rent for Carnegie House’s residential and retail space would rise from $6.4 million a year to “nearly $40 million” in 2025. That’s because provisions written when the lease was drafted around 1960 called for the rent in 2025 to equal 8.1667% of the fair market value of the “demised land, considered as vacant, unimproved and free of this lease.”
For Schron and Werner, Carnegie House’s rent-reset comes when some of their other properties are struggling. Schron’s portfolio includes towers at 42 Broadway and 45 Broadway in the Financial District, a neighborhood with a 27% office vacancy rate, according to Cushman & Wakefield. He also owns what one attorney described as nursing homes “at an industrial scale.” Schron wouldn’t comment on his holdings.
Werner owns 5 Times Square, a building formerly occupied by Ernst & Young that could be partially converted into apartments. He leads a syndicate of investors that owns 40% of 237 Park Ave., a tower poised to lose tenant JPMorgan after the bank’s new headquarters across the street is completed next year, according to bond-rating firm KBRA. Werner avoids the press, according to real estate newsletter The Promote, citing "ayin hara," which is Hebrew for “evil eye.”
Last year billionaire Michael Dell’s merchant bank, MSD Partners, extended a $100 million loan to Schron and Werner, according to the Real Deal. MSD declined to comment.
Ground-lease negotiations are often contentious. Two years ago, Vornado Realty Trust renewed its lease for land near Penn Station through 2073 and is still fighting in court with the landlord over the rent. Vornado CEO Steven Roth estimated the lease could jump to $26 million a year from $2.5 million. Vornado says in a regulatory filing that the final price “may be materially higher or lower” than its estimate.
Schron and Werner are bringing the same kind of fight to Carnegie House, a place where residents get their mail and packages handed to them daily by doorman Bryan Gallardo, who has worked at the co-op for 15 years.
“This is a building where neighbors look out for each other,” Gallardo said.
Feel like hostages
For a long time ground leases were rare under apartment buildings. That started to change in 1982, after tenants at an Upper East Side building prevailed in a lawsuit against the state attorney general’s office, which is responsible for approving co-op financial plans. Condominiums are governed by a different state law and prohibited from leasing their land.
For leaseholders, separating the land from the building above was a useful way to raise cash while keeping a stake in the property. And developers with a 99-year ground lease in their pocket can use it as collateral to borrow and build a lot taller than they otherwise could.
Even though the ground rent would rise over time, the risk of the lease causing problems was understood to be too small to matter. Carnegie House resident Anthony Santiago said his bank didn’t raise any issues when he refinanced his mortgage in 2012.
“No one mentioned the ground lease,” he said.
Now, in recognition that the odds of a co-op defaulting and reverting to a rental property are higher, banks are refusing to write mortgages at buildings whose ground lease renews in 30 years or less, said Robert Cecere, a lawyer at Daniels Norelli Cecere & Tavel. At such buildings apartments sell for cash or not at all.
“You’ve got apartments that can’t be sold and can’t be bought,” Cecere said. “How crazy is that?”
Santiago, 69, had planned to retire a few years ago, sell his two-bedroom apartment and live somewhere else. But because of his co-op’s rent problem, no buyer will pay him close to market rate. So he’s still working in elevator construction and still in the apartment he’s ready to part with.
“My wife and I feel like hostages,” he said.
Carnegie House has joined a group called the Ground Lease Co-op Coalition to lobby Albany for relief. Sen. Krueger sponsored a bill that would limit rent increases in ground-lease co-ops to 3% a year, the same rate typically charged to office buildings. The bill was approved by the Senate Judiciary in a 10-8 vote last session but didn’t go further due to opposition from the Real Estate Board of New York. The powerful trade group argued the bill would violate the U.S. Consitution’s “takings” clause because it’s unlawful government interference with privately negotiated contracts.
“These are agreements between, as a general matter, sophisticated parties,” said Anita Laremont, a partner at Fried Frank Harris Shriver & Jacobson who represents REBNY. “We don’t believe there’s a legitimate public purpose here.”
After years of fruitless back-and-forth haggling with Schron and Werner, what Carnegie House described in its lawsuit as formal negotiations began in March. Schron and Werner waited until the last day of the negotiating period, Sept. 13, before proposing to raise the ground rent to $25 million from $4 million, according to the co-op, which accused the landlords of failing to negotiate in good faith and making “a thinly veiled attempt to force Carnegie House into insolvency.”
Schron said Carnegie’s House’s offer to pay $5.6 million in rent is inadequate and amounts to just 60 cents a share per unit on a per-square-foot basis.
“You can’t offer 60 cents for a suit that costs 200 or 300 dollars,” he said.
Attorneys say the co-op’s lawsuit will likely be dismissed because its rent hasn’t been raised yet and no harm has yet taken place.
“This lawsuit is premature,” said James Catterson, a partner at Pillsbury Winthrop Shaw Pittman and a former New York state judge.
A spokesperson for Schron said: “By filing this complaint, the co-op has tacitly conceded that it believes its proposal is meritless.” Nevertheless, this week the co-op secured a procedural victory when a state judge, Arthur Engoron, granted its request to postpone arbitration proceedings until a preliminary hearing is held in his courtroom on Nov. 13. And on Sept. 27 Gov. Hochul signed into law legislation allowing co-ops to initiate renewals or extensions before their ground leases expire, granting some of the relief sought from Albany by ground-lease co-ops.
Carnegie House is represented by Tim Collins, who has sparred on behalf of Stuyvesant Town-Peter Cooper Village, Manhattan’s largest apartment complex, over rent protections and improvement costs with landlords such as Blackstone Group and CW Capital.
In the meantime, Carnegie House residents are left to stress over how much the rent will rise for the dirt below – and whether they’ll be wiped out financially and lose their homes.
“I fear that sooner or later our health will snap,” said Santiago’s wife, Yolanda, a retired hospital administrator, “and that we will have to go through life without each other.”
PUBLIC HEALTH LAB: The Department of Health and Mental Hygiene is seeking a vendor to manage the relocation of the city's Public Health Laboratory. The Department is moving the lab from its current site in Kips Bay to a new building in West Harlem as part of a plan to develop a life sciences hub on Manhattan's east side. The vendor would be responsible for managing the move of records, lab equipment, chemicals, computers and other supplies, according to a request for proposal.
CANCER COVERAGE: Gov. Kathy Hochul signed legislation Tuesday to require health insurance companies to cover additional breast cancer screenings for New Yorkers. The new law mandates that insurers cover tests including mammograms, ultrasounds and MRIs when providers recommend them under national cancer screening guidelines – an expansion that aims to ensure people have access to procedures that can detect cancer early. The legislation clarifies that patients won’t have to pay out of pocket for these diagnostic procedures, except in cases when they’d be ineligible for reimbursement under a health savings account.
HEALTH TIPS: New York-Presbyterian launched a health advocacy campaign this week to encourage New Yorkers to make behavioral changes to improve their well-being. The health system is publishing tips – which include getting regular exercise, eating a healthy diet and getting enough sleep – on its website and citywide advertisements, and has installed live speedometers at three bus stops in Brooklyn, Queens and Manhattan to encourage New Yorkers to pick up their walking pace.
Gov. Kathy Hochul handed over a home care program that costs the state $9 billion to financial services firm Public Partnerships LLC this week, along with the colossal task of consolidating one of New York’s most popular Medicaid services from 700 companies to just one.
Hochul’s decision to award the contract to PPL is the latest development in her plan to rein in the ballooning Consumer Directed Personal Assistance Program. The program, which allows New Yorkers to hire family members and friends to provide home-based services, has grown exponentially in the past decade and driven up the state’s Medicaid costs.
PPL will lead the charge on whittling down the hundreds of existing companies that facilitate the program, partnering with 30 current middlemen to enroll and educate patients and workers. The firm is ultimately responsible for overseeing the program and paying workers, according to Maria Perrin, the company’s chief growth and strategy officer. It is not clear when the contract will start, the duties of the subcontractors are not defined and the cost of the contract is still unknown. But the state’s changes to the program face at least four lawsuits attempting to halt the consolidation from going into effect.
The deal has sparked outcry within the home care industry, which says that PPL’s shaky track record could jeopardize services in New York. Although the company has operated programs in 20 other states, it’s been under a magnifying glass in prior years for payment delays and disruptions that advocates say don’t bode well for the future of New York’s program. But the company says it is up to the task as a leader in a competitive consumer-directed market.
The Georgia-based company was founded in 1999 to assist the Robert Wood Johnson Foundation launch its consumer-directed care pilot program. Now, it operates in 21 states.
PPL has long been rumored to be a top contender for New York’s home care contract. It made moves to establish its operations locally by fielding partnership agreements before the bidding process concluded to offer a lifeline to fiscal intermediaries set to go out of business and also hired a New York director.
The firm also invested in its political relationships in New York. The home care administrator inked a $6,500 monthly contract with the lobbying firm Cozen O’Connor to provide “strategic advice and business development” earlier this year. Its head of government relations Patricia Byrnes donated the $5,000 to Hochul’s re-election campaign last year – the maximum contribution allowed under state law – and an additional $1,000 earlier this year.
One of the most influential relationships could be with labor union 1199SEIU, a powerful political force in New York health care that has supported the state’s move to consolidate home care as a path to organize home care workers. In response to a question from Crain’s about whether PPL has a relationship with 1199SEIU, Perrin said that the company will cooperate and allow workers to decide whether they want to organize, but did not speak to the specific ties between the two organizations.
A spotty track record
Despite PPL’s national presence, it has a spotty track record in administering similar programs in other states. A Pennsylvania state auditor’s report found in 2013 that PPL showed “numerous red flags” when it took over a consumer-directed program in the state, leading to missing records and inaccurate data that delayed payments for workers, in some cases for months.
Those missing payments led 20,000 home care aides in Pennsylvania to file a class-action lawsuit against PPL in 2017. The workers alleged that the company repeatedly failed to pay them for overtime hours, despite the fact that some consistently worked 60 or more hours per week. The lawsuit is still ongoing.
Bryan O’Malley, who leads an organization that represents home care agencies, called New York’s decision to strike a deal with PPL a “recipe for chaos” given its prior work in Pennsylvania, adding that it puts consumers at risk of losing access to services.
Perrin said that it is “telling” that critics of the CDPAP consolidation have pointed to contracts that are more than 11 years old to point to PPL’s missteps.
Some states have chosen to end their contracts with PPL. Pennsylvania terminated its contract with PPL in 2021, handing over its consumer-directed contract to Massachusetts-based firm Tempus Unlimited.
West Virginia also ended its contract with PPL earlier this year, swapping out the provider for the Arkansas-based home care administrator Palco. Perrin said that the change was not related to PPL’s performance; rather, it was a result of a competitive bidding process.
“This is a competitive market,” Perrin said. “There’s several national FIs, we win from each other, we lose from each other. This is a good thing, because it keeps prices down.”
Sen. Gustavo Rivera, a Bronx representative who chairs the health committee, said that he remains “seriously concerned” about the decision to strike a deal with PPL, given that other states have decided not to renew contracts with the company.
Perrin said she is confident that PPL will lead the state to a successful transition for its home care program.
“There’s been a lot of misinformation about anyone connected with this,” Perrin said. “This transition is going to happen, so let’s make it the best we can for vulnerable populations.”
New York will stop pharmacy benefit managers from muzzling pharmacists who pull back the curtain on drug reimbursements for their patients.
Gov. Kathy Hochul signed a new bill last week that will crack down on the middlemen companies, who were previously permitted to control what pharmacists could tell patients about how much they get reimbursed for prescription drugs. It builds on previous legislation introduced in 2018 that banned PBMs from prohibiting all conversations between pharmacists and patients about their out-of-pocket costs for certain drugs.
Small, independent pharmacies often get low reimbursement rates for certain medicines that cause them to operate at a loss – an arrangement that sometimes forces them to stop stocking those drugs. Pharmacists have historically been subject to a gag clause that prevents them from discussing those circumstances with their patients, keeping drug costs opaque, Assemblywoman Linda Rosenthal, the co-sponsor of the new law, said in a statement.
“PBMs want to keep patients in the dark about the true cost of their medicine,” Sen. Andrew Gounardes, a Brooklyn legislator and co-sponsor of the law, said in a statement. “They say sunshine is the best disinfectant.”
Pharmacy benefit managers act as an intermediary between pharmacies and insurance companies to create lists of covered drugs and process claims. The middlemen were first introduced in the 1960s to control drug costs, but research has shown that they’ve been more likely to inflate prices.
New York’s new law comes as such companies face heightened scrutiny from federal regulators. The Federal Trade Commission took the country’s three largest PBMS – CVS’s Caremark Rx, Express Scripts and UnitedHealth’s OptumRx – to court last week alleging that the companies, which fill 80% of all prescriptions in the U.S., were responsible for artificially inflating the costs of insulin.
Home health care agencies continue to reign over other employers in the pantheon of wage theft.
Two licensed home health care providers agreed to pay $17 million in stolen wages to 25,000 workers and the state and federal governments as part of a settlement with the state Attorney General’s office and the U.S. Attorney in Brooklyn. Home health care agencies have dominated the state’s wage theft rostrum, accounting for the top seventeen worst offenders in New York City from 2020 to 2022. The settlement with two Brooklyn-based providers is the largest the Attorney General has ever reached under the state’s Wage Parity Act, according to the office, and helps the sector maintain its perch on that unsavory pedestal.
Kensington-based Edison Home Health Care and Midwood-based Preferred Home Healthcare will pay $7.5 million in unpaid wages to workers and another $9.75 million to Medicaid for the alleged fraud. From 2012 to 2020, the joint investigation found Edison and Preferred failed to provide their employees minimum wages and benefits as required for licensed home care service agencies under state law, according to the Attorney General’s office. At the same time, the company’s leaders were diverting millions of dollars to enrich themselves, the office alleges.
Of the money owed to Medicaid, the companies agreed to pay $5.85 million to the state and $3.9 million to the federal government.
Wage theft is prevalent across the sector, from licensed providers like the ones involved in the settlement to less regulated firms under the state’s consumer directed program. The workers impacted are predominantly women, immigrants and people of color.
Both companies were acquired by Help at Home, a Chicago-based provider, in 2022, according to a spokesperson for the company. The operators involved during the time of the alleged wage theft are no longer employed, according to a statement from vice president of public relations Kristen Trenaman. The company also added new protocols to comply with the law, the statement said.
Eric Adams stood alone in City Hall on Tuesday and tried to project confidence in his imperiled mayoralty as he answered in-depth questions for the first time since his federal corruption indictment.
Adams was not seated at a table surrounded by his usual phalanx of deputy mayors, and instead stood by himself in the City Hall rotunda in a change from previous weekly press conferences. Some administration officials have subtly distanced themselves from Adams in recent days by publicly emphasizing their own work separate from the mayor’s legal troubles; Adams said Tuesday that he wanted to let them focus "on running the city" while he fielded questions about the four known federal probes affecting City Hall.
“As the case unfolds, some people are going to say, 'You know what? We may have jumped the gun on Eric Adams,’” the mayor predicted. Adams’ attorney Alex Spiro filed a motion hours earlier on Tuesday requesting sanctions against Manhattan prosecutors based on his claim that they had illegally leaked confidential grand jury information to news media in the months leading up to Adams’ indictment.
Adams mostly declined to respond to specific questions about the indictment by the Southern District of New York, citing the pending legal case. The SDNY is alleging that the mayor accepted years of free travel from Turkish officials in exchange for future favors and that he knowingly took illegal foreign donations to his 2021 campaign.
Before Adams hired Spiro and his colleagues at the firm Quinn Emanuel, other lawyers from the firm WilmerHale had been negotiating with the Justice Department for months before the indictment. Responding to a reporter’s question, Adams said his WilmerHale attorneys Brendan McGuire and Boyd Johnson are “still very much connected to what we’re doing” but did not explain why he had brought on the additional firepower.
“He's one of the best trial lawyers in the country,” Adams said of Spiro.
The mayor plans to attend his next scheduled court appearance on Wednesday, he said.
Adams also announced two additions to his growing legal apparatus: Allison Stoddart will take over as chief counsel, a position that has been vacant since Lisa Zornberg abruptly resigned as the mayor’s lawyer on Sept. 14 following reported disagreements over his personnel decisions. Stoddart has served since the start of Adams’ term as chief of staff in the chief counsel’s office.
And the mayor nominated Muriel Goode-Trufant to serve as the city’s corporation counsel, a powerful job that includes supervising the 800-attorney Law Department and representing all branches of city government in litigation. That role was vacated by Sylvia Hinds-Radix in June, who resigned amid other reported disagreements with Adams; his first attempted replacement, Randy Mastro, asked Adams to withdraw his nomination last month as he faced rejection by the City Council.
Goode-Trufant, who has spent 30 years in the Law Department and already serves as acting corporation counsel, is likely to face less resistance from the City Council, which gets final say over the appointment.
Although private lawyers are representing Adams in the corruption probes, he has spent city resources to pay Spiro to represent him in a separate case accusing the mayor of sexual assault in the 1990s. And taxpayer-funded lawyers notably represented top aide Tim Pearson — who announced his resignation on Monday — in his own sexual harassment cases. (Adams would not say Tuesday whether the city will continue to cover Pearson’s legal fees after his resignation.)
A moment of levity came late in Tuesday’s press conference when a reporter asked Adams whether he had enjoyed the service on Turkish Airlines — provoking laughter in the rotunda.
“I love that question,” he said, smiling. “Great service.”
A judge has thrown out a lawsuit against former Gov. Andrew Cuomo and his deputies over a decision to require nursing homes to accept Covid-positive residents at the height of the pandemic.
Judge LaShann DeArcy Hall granted a motion to dismiss filed by Cuomo’s lawyers in the U.S. District Court in Brooklyn on Monday. The decision is a victory for the former governor as questions mount about whether he will throw his hat into the mayor’s race.
The suit was filed on behalf of two men with parents who died in nursing homes after New York State issued the now-infamous directive. It names Cuomo, former Secretary to the Governor Melissa DeRosa and former Health Commissioner Howard Zucker.
The decision has been one of the enduring scandals of Cuomo’s governorship since he resigned over sexual harassment allegations in 2021. Earlier this month, he defended his actions before a House panel focused on his handling of the pandemic.
The plaintiffs’ lawyers were hoping the case would become a class action suit on behalf of any senior who died in a nursing home from Covid-19 during or shortly after the directive was in place, said attorney Michael Kasanoff. But the judge’s decision throws a wrench in those plans.
The court has not released the order or a memorandum about the decision leaving the reasoning a mystery.
Cuomo spokesman Rich Azzopardi lauded the court’s decision and said the nursing home directive had been “weaponized” by the former governor’s political enemies.
The plaintiffs plan to appeal “no matter what is in that opinion,” Kasanoff said.
The Metropolitan Transportation Authority and BXP broke ground on a new Grand Central Terminal entrance Tuesday morning, part of the real estate firm's massive planned office tower at 343 Madison Ave. that is still awaiting an anchor tenant.
The project dates back to 2013, when the MTA issued a request for proposals to redevelop the site that was once its former headquarters, ultimately ground-leasing it to BXP (known until recently as Boston Properties). A number of transit renovations were part of the deal, including the upcoming entrance to Grand Central Madison, which gives Long Island Rail Road commuters access to the terminal. Work on the entrance should take about 18 months to complete.
The office tower itself is still in its final design stages, and BXP should be ready to start construction as soon as it finds a main tenant, said Hillary Spann, executive vice president at the firm.
"We are having constructive conversations with anchor tenants in the marketplace," she said, "and I think as soon as we secure one, we'll be ready to go vertical."
BXP CEO Owen Thomas declined to put a timeline on the firm's tenant negotiations but said the location and quality of the tower will make it an attractive destination.
"There's not a lot of availability close to Grand Central," he said. "If you're a tenant over 100,000 feet, new construction is probably what you're going to be looking at, and this site is ready to go."
Thomas sounded a similar note on an August 2023 earnings call, when he said the firm was having "preliminary discussions with potential anchor clients" for 343 Madison. At an investor conference soon after, company President Douglas Linde said rents will need to be "well in excess of $200 a square foot" to make building a new office project worthwhile.
The company's skyscraper at 343 Madison Ave. should span about 950,000 square feet overall. BXP has partnered on the project with Norges Bank Investment Management, Norway's $1.4 trillion sovereign wealth fund, which bought a 45% stake in it last year.
The development has been seen as BXP's effort to compete with projects like SL Green's 1 Vanderbilt and the new JPMorgan headquarters going up at 270 Park Ave. However, Thomas downplayed those comparisons Tuesday, noting that BXP has been at work on 343 Madison for more than a decade.
The firm's occupancy rate for its New York properties, which include the GM Building and 399 Park Ave., slipped to 87% during the second quarter of the year. Thomas said office buildings remain "challenging" as an overall asset class on that quarter's earnings call.
MTA Chairman Janno Lieber noted at Tuesday's event that work on the office tower itself was still in progress, saying in his remarks that BXP is "inching closer, we think and hope, to building a building on this site.
"But we cannot wait any longer for the entrance to the Grand Central Madison facility to be built," he continued, "and that's what we're here to celebrate today."
A midsize wealth-management firm and a small bank have agreed to lease more space 101 Park Ave., a development that will help offset the loss of a prominent hedge fund and a major bank.
Corient, a Miami-based wealth manager with $120 billion in regulatory assets under management, has agreed to lease another floor measuring 25,000 square feet and increase its footprint in the 48-story tower to 77,000 square feet. Pennsylvania-based Customers Bank, with $21 billion in assets, is also leasing an additional 25,000 square feet and will occupy a total of 37,000.
“We are excited to announce this expansion by two first-class tenants,” said 101 Park’s owner, Peter Kalikow, president of H.J. Kalikow & Co.
The additional floors taken by Corient and Customers Bank amount to half the space being left behind by Tiger Management and Morgan Stanley. Tiger, a hedge fund founded by Julian Robertson, moved out of 53,000 square feet last month and Morgan Stanley is expected to vacate 49,000 square feet in December, Crain’s reported. Morgan Stanley is a global bank with $1.2 trillion in assets, while Tiger wound down many years ago and spawned successors including Tiger Global Management, which manages $60 billion in client assets from its office at 9 W. 57th St.
Tiger paid $115 per square foot and Morgan Stanley $83 a square foot at 101 Park, according to credit-rating firm KBRA. The amounts paid by Corient and Customers Bank weren’t disclosed.
101 Park, located a block south of Grand Central Terminal at the corner of East 40th Street, is a 1.3 million square-foot tower developed in 1982 by Kalikow. Its large boardrooms, sculptures, granite floors and dark-wood flourishes match the style and spirit of prestigious towers lining Park Avenue a few blocks north. The private dining and entertainment venue, Club 101, was recently renovated. Officials told Crain’s last month they expected existing tenants to take over Morgan Stanley’s floors and that proposals had been exchanged with potential tenants regarding much of the building’s soon-to-be vacated space.
John Cefaly, executive vice chairman at Cushman & Wakefield, said the lease expansions from Corient and Customers Bank underscore “the enduring value and attractiveness of 101 Park Avenue as a premier workplace destination.”
A real estate developer with a world-class art collection is looking into the construction of a 7-story art storage facility in Bushwick. It would be the company's third such facility in the five boroughs and second in the Brooklyn neighborhood, city records show.
Steven Guttman, who founded both the storage facility-building firm Storage Deluxe in 1998 and years later the art company Uovo, which specializes in the safeguarding and preservation of fine art and other collectibles, is seeking approval from the city in order to erect a 240,000-square-foot fine arts storage hub at 74 Bogart St., according to a rezoning application filed with the Department of City Planning this week.
Guttman started Uovo — which is the Italian word for egg — in the aftermath of Superstorm Sandy in 2012, when he saw the destruction of high-value art at warehouses in the path of the storm. A year later he had begun constructing Uovo's first facility in the city — a 280,000-square-foot building at 41-54 22nd St. in Long Island City, The Wall Street Journal reported at the time. In a 2014 Forbes profile, Guttman said he had amassed more than 500 pieces of fine art and was a regular attendee of art fairs around the world, including Frieze in London and New York and Art Basel.
Andrew Ehinger, vice president of the Flatiron District-based Storage Deluxe, filed the application on behalf of Uovo under a private entity named after the address, records show. Neither Ehinger or Uovo responded to requests for comment.
Uovo operates nearly a dozen art storage facilities across the county, including a second in Brooklyn, at 105 Evergreen Ave. in Bushwick. The proposed Bogart warehouse, if approved, would rise on a roughly 80,000-square-foot lot that Storage Deluxe bought for $45.5 million in 2019, records show.
The company tore down the existing 1-story structure on the eastern portion of the lot, between Ingraham Street and Harrison Place, and put up a 7-story self-storage facility, which has since been operated by CubeSmart. Storage Deluxe estimated at the time that the cost to develop the property would be more than $50 million, Crain's reported.
A cost estimate for the proposed art-storage facility on Bogart Street, however, which will rise on the western portion of the lot, was not immediately available. Uovo plans to lease about 16,000 square feet in the new building to retail, according to the application.
Chelsea-based design firm S9 Architecture appears to be the architect of record on the project and submitted illustrative drawings for the application but did not respond to a request for comment.
All Uovo facilities are climate-controlled and house valuable pieces of art for both personal collectors as well as larger institutions, such as galleries and museums, according to the company's website.
Attorneys for the applicant, Ethan Goodman and Eric Knowles of the Midtown-based law firm Fox Rothschild, did not respond to a request for comment.
Is it Andrew Cuomo’s time to shine?
The former governor, who resigned in disgrace in 2021, is strongly considering a run for mayor, now that Eric Adams has been indicted. If Adams resigns, a special election will be triggered, and many think Cuomo is sure to enter it. This might be his best opportunity for redemption.
He should not be underestimated. He enjoys universal name recognition in New York City and lingering goodwill from his Covid-era press conferences. As the governor for more than a decade, he can go to voters and promise he’ll know how to run a municipal government that has apparently sunk deep into the muck of corruption.
The real estate and business elites who help to decide the course of elections could warm to Cuomo, along with certain labor unions. If Cuomo’s main opponent is the progressive Jumaane Williams, who in this scenario would be the interim acting mayor, the business class could coalesce behind the ex-governor. So could some of the working class Black and Latino voters who supported him throughout his gubernatorial campaigns.
A special election would be a three-month sprint, favoring a candidate like Cuomo. His opposition would have much less time to make themselves known and attack him simultaneously. The electorate would not be limited to Democrats, which could theoretically benefit him with more moderates casting votes.
Does all of this add up to a Cuomo victory? That’s far less clear. He’d be a front-runner, but not a vaunted one who could sprint away from the field of Democrats. He has real weaknesses that could come into sharp relief very soon.
There is the nature of the sexual harassment scandal that felled him. Even if voters have moved on from that — if the MeToo era has cooled — there are his Covid scandals. The millions of dollars he accepted for a pandemic memoir as thousands died from the virus. His decision to send Covid patients back into nursing homes, fueling carnage there.
A race to replace Adams would be, by its nature, a change election. Voters will cast about for alternatives to scandal and disgrace. Cuomo’s long tenure in government was tumultuous. His closest aide, at one point, was indicted on corruption charges. (The Supreme Court, narrowing the definition of corruption, eventually overturned that conviction.)
New Yorkers might prove wary of Cuomo once his opponents begin to reeducate them on his past. In a ranked-choice voting election, his potential rivals — Williams, City Comptroller Brad Lander, former City Comptroller Scott Stringer, and at least two state legislators — would be incentivized to unite and attack him repeatedly. He would be the focus of the election, especially if he’s a polling leader at the outset.
Early front-runners in mayoral elections tend to be vulnerable. Ask Christine Quinn or Andrew Yang. In a ranked-choice voting election, polarizing candidates can struggle. There will be voters who simply refuse to put Cuomo on their ballots.
Another unsettling parallel for Cuomo is Eliot Spitzer. Former Gov. Spitzer, who resigned in a prostitution scandal, attempted a comeback five years later in a race for city comptroller. He polled far ahead of his rival, Stringer. He looked, for weeks, like a lock to win.
And then, as Stringer took aim, he faded. Stringer had the help of a labor and business establishment that might be less likely to turn on Cuomo. Still, the criticism can take its toll. If Cuomo, in his early polling, has high negatives, it will be a challenge to bring them down.
The final challenge is money. As governor, Cuomo was a prolific fundraiser. He shouldn’t have trouble here, except that the city matching funds system rewards smaller dollar donations that he never had experience chasing. He’s used to a hedge funder or developer sending him tens of thousands of dollars in one shot, as the statewide system allows. He won’t be able to do that now.
Cuomo can win. His victory — and even his entrance into the race — cannot be treated as a fait accompli, though. Not now, anyway.
Ross Barkan is a journalist and author in New York City.
Leases
Luxury clothing brand opening flagship store in GM Building
Address: 767 Fifth Ave., Manhattan
Landlord: Boston Properties
Tenant: Moncler
Lease size: Approx. 24,000 square feet
Asset type: Retail
Golf simulator inks lease with Vornado
Address: 1290 Sixth Ave., Manhattan
Landlord: Vornado Realty Trust
Tenant: Five Iron Golf
Lease size: 15,300 square feet
Asset type: Retail
Brokers: CBRE's Anthony Dattoma and Compass' Jason Goode represented the tenant. Cushman & Wakefield's Michael O'Neill, Jason Greenstone and Taylor Reynolds represented the landlord, along with Edward Riguardi, Ed Hogan and Jason Morrison in-house.
TF Cornerstone lands bakery at LIC project
Address: 4630 Center Blvd., Queens
Landlord: TF Cornerstone
Tenant: Somedays Bakery
Lease size: 800 square feet
Lease length: 15 years
Asset type: Retail
Brokers: Stately Ventures' Eddie Mamiye represented the tenant. Winick Realty Group's Steven Baker, Daniyel Cohen and Thomas Galo represented the landlord.
Sales
Developer snags Chinatown renovated walk-up rental building
Address: 305 Broome St., Manhattan
Seller: SMA Equities
Buyer: Sky Management Corp.
Sale price: $11.8 million
Asset type: Mixed-use
Tim Pearson, a powerful aide to Mayor Eric Adams who was embroiled in multiple scandals during a tumultuous tenure in City Hall, announced his resignation late Monday.
Pearson, a former colleague of the mayor’s in the police department, wielded significant power over the NYPD and contracts relating to the migrant crisis, but there were scant public details about his role. In recent months, Pearson was accused of sexual harassment in four lawsuits filed by former subordinates, was accused of instigating a brawl with security guards assigned to a migrant shelter, and had his phones seized in a federal corruption inquiry.
But Adams, before and after his Sept. 25 indictment, has avoided calls to terminate Pearson, which reportedly factored into the resignation of City Hall’s chief counsel Lisa Zornberg. He continues to employ other aides who were caught up in September’s federal raids, including Phil Banks, the deputy mayor for public safety.
“Due to the recent events, Pearson decided to resign, effective Friday, Oct. 4, 2024, so the Mayor could restructure his team,” Pearson’s attorney Hugh Mo said in a statement. He added that Pearson denied any claims of wrongdoing that have been reported in the media, which he called “false and defamatory.”
Pearson submitted a resignation letter to Adams on Monday, saying he had “decided to focus on family, self-care, and new endeavors.” Adams, in a short statement, thanked Pearson for his “decades of service to this city” and wished him well.
The mayor had previously defended his longtime friend in the face of criticism from inside and out of City Hall. After the typically-friendly New York Post editorial board explicitly called on Adams to fire Pearson on Sept. 17, the mayor denied the idea that he was showing Pearson any special loyalty.
“I'm loyal to the 300-plus thousand employees in the city,” Adams told reporters last month.
Pearson is the latest of several high-level Adams administration officials to announce their departures, including Police Commissioner Edward Caban, Schools Chancellor David Banks and Health Commissioner Dr. Ashwin Vasan.
The recent accusations against Pearson included a claim that he talked openly about seeking kickbacks from migrant contracts. A former subordinate of Pearson’s in the small unit he led alleged that Pearson said: “Do you know how these contracts work? People are doing very well on these contracts. I have to get mine. Where are my crumbs?”
The compensation data below highlights the highest-paid employees at a tax-exempt organization that filed a Form 990 for 2021. See the top earners at other New York health systems here.
Notes: "Cash compensation" includes base compensation, bonus and incentive compensation, and other reportable compensation from the health system and related organizations. "Other compensation" includes nonreportable compensation, deferred compensation, retirement-plan benefits, health care benefits and other fringe benefits from the organization and related organizations. Titles reflect positions held in 2022.
Fans of trimmings — not the Thanksgiving kind, but the sequins, tassels and ribbons that give a little pizzazz to clothing — suffered a blow in mid-September with the news that M&J Trimmings, a mainstay of the Garment District since 1936, will soon close its Sixth Avenue location.
But some landlords in the neighborhood, which stretches across the West 30s and West 40s, may have had the opposite reaction. Eager to turn empty textile factories into housing to help meet embattled Mayor Eric Adams’ ambitious goal of creating 500,000 new units by 2032, the property owners are backing his push to ease regulations on building conversions. M&J’s disappearance, then, seems to provide more proof of the garment industry’s fading relevance.
One doesn’t have to look far to see that the sector is in retreat. The blocks near M&J, once a vibrant hub of the hat-making trade, will have almost no traces of their industrial history once M&J turns out the lights this fall. To wit: The Bead Center, which sold similar notions at 989 Sixth Ave. across the street and was itself a vestige of an older neighborhood, shuttered in 2021 and was razed to make way for an ongoing 68-story condo development.
To be sure, the M&J space, addressed at 1008 Sixth Ave. near West 37th Street, may not be much of a candidate for a major makeover itself. It sits inside a sleek high-rise developed in 2001 on a site that previously housed textile tenants, so its structure is already more symbolic of a new era than the past.
And if lawmakers do pass Adams’ City of Yes plan, which would make it easier to convert commercial sites into housing, more wrecking balls could start swinging in the neighborhood. Developers will also likely come knocking if officials green-light a related proposal to rezone the district from a manufacturing enclave to a residential one, a move that already has the support of the Garment District Alliance, a landlord-centric advocacy group. The “Garment District is dead” voices may have a fresh data point with M&J’s closing.
Why exactly the popular M&J is shuttering is unclear. The store has long had a regular roster of blue-chip corporate clients, such as Ralph Lauren, Betsey Johnson and the Jim Henson Co., according to its website, as well as frequent celebrity shoppers, such as actress and fashion entrepreneur Sarah Jessica Parker. If any fashion business could hang on in Manhattan, it would seem to be this one.
For his part, Michael Cohen, the store’s owner, isn’t revealing much. “It is a difficult time, and we are doing the best we can,” he said in a brief phone interview this week, though he declined to say what will come next for his store or its real estate.
In the meantime, the City of Yes plan cleared a key hurdle on Wednesday when the Planning Commission approved it in a 10-3 vote. It heads for a final vote before the City Council by the end of the year.
1008 Sixth Ave.
In the mid-1990s, M&J Trimming owned three sites on the west side of Sixth Avenue between West 37th and West 38th streets. The mothership for ribbons, rhinestones and lace was at No. 1008, where a Five Guys serves burgers today, even though M&J’s owner, the Cohen family, has retained control of the building. Closer to West 38th was a button annex and home-furnishings store, though a major fire wiped out both sites in 1997. Afterwards, the Cohens partnered with developer The Gotham Organization to rebuild the block, seemingly aware the site could accommodate a much larger structure than what had been there for decades. After tacking on other parcels and some air rights, the team in 2001 unveiled a 47-story project with apartments, offices and retail space. Its residential portion, with 373 market-rate and affordable units, is called Atlas New York. M&J, meanwhile, became owner of the wide retail commercial condo along Sixth, which is divided into several stores. Its main store then relocated from the Five Guys building a few feet to the north, into the space where it is today, though somewhat confusingly both Five Guys and M&J use the same numerical address. M&J, which Michael Cohen heads, will close the store this fall. The family’s other retail berths in the building seem to have been hit with high turnover. Tenants that have come and gone after short stays, based on Google Street View photos, include a Wasabi Sushi and Bento branch, a GNC vitamin store and the jewelry supply shop Genuine Ten Ten. Meanwhile, the home-furnishings shop once located on the block, Samuel & Sons, which is also owned by the Cohen clan — other family members in the business include Michael’s father, Samuel Cohen, and his brothers, Hymie and Joseph Cohen — does business today at a new East Side site, 983 Third Ave.
1001 Sixth Ave.
Reinvention came a decade ago to this 23-story, 250,000-square-foot prewar structure, which housed glove companies and other apparel businesses before its owner, 1001 Sixth Associates, made over the site as a more traditional office building in 2012. The owner is a firm linked to the late Alvin Schwartz, an associate of the powerful developer Harry Helmsley who took over much of Helmsley’s portfolio after he died in 1997. Schwartz replaced windows, upgraded elevators and created a new lobby, which seems to have helped the building attract law firms, ad agencies and tech companies. Ten office spaces were available late last month, including five suites on the 11th floor and three full-floor berths on levels 14, 16 and 20, according to ABS Partners Real Estate, which manages the property. Marvelous by Fred, a two-level, three-year-old pastry and sandwich shop that glitters with a tall chandelier, occupies a storefront.
1033 Sixth Ave.
Perhaps no project did more to physically alter this part of the Garment District than the 43-story tower at this address, a 2006 undertaking by the developer G Holdings that stacks 10 floors of condos atop a 360-room Residence Inn by Marriott hotel. The massive 241,000-square-foot structure, which replaced a low-slung parking garage and other modest buildings, takes up the entire block save for two parcels, which it wraps around. One of those plots contains the Millinery Center Synagogue, a longtime house of worship for textile workers at No. 1025. The other site, No. 1027, features a gift shop. The least expensive unit for sale in late September in the building’s condo section, which goes by the name Bryant Park Tower and uses the address 100 W. 39th St., was a one-bedroom that has bounced on and off the market for years asking $880,000, StreetEasy shows. According to the city register, the owners appear to have paid a similar amount, $860,000, when they bought it from the sponsor in 2006.
1017 Sixth Ave.
This humble prewar mixed-use mid-rise is the type of structure that was once ubiquitous in the neighborhood but is now increasingly rare — the buildings that M&J lost in the 1997 blaze looked similar. The Pennsylvania-based Morgenstern family appears to have owned the 6,500-square-foot structure since the mid-1990s and paid off the mortgage on the site about a decade ago, according to the city register. Leasing its ground floor is Bryant Market, a deli, and on its ground floor is Spirit Lab Yoga, an exercise studio. The four-story building, which likely has untapped air rights, is worth $5.6 million according to city officials, a recent high for the property. When the city rebranded Sixth as the Avenue of the Americas as a unifying gesture in the wake of World War II, a lamppost in front of No. 1017 gained a large medallion adorned with the colorful coat of arms of a nation in the Western Hemisphere (tax photos are blurry as to which exact country it was). But it and others gradually vanished through the years after road projects, and the initial total of 300 medallions on the avenue had dwindled to just 18 by 2023, when Adams began restoring them en route to a 172-medallion goal. The new marker now dangling outside No. 1017 is a tribute to Suriname, even as “Sixth Avenue” endures as the road’s handle.
63 W. 38th St.
A neo-Gothic former hat factory in an area known for its headwear, this 13-story terracotta-and-brick edifice appeared to be in dire straits in January 2009 before the developer Savanna swooped in to acquire its deed in lieu of foreclosure, a deal valued at $44.9 million, according to the register. But the firm didn’t hold onto the 121,000-square-foot site for long. In November 2009 it flipped No. 63 for $29.5 million to a team led by the developer Aini Assets, which then transformed the prewar structure into the 200-room Refinery Hotel, which opened in 2013. In 2021, the ownership group, which also includes costumer jewelry importer Raizada Vaid and Highgate hotels executive Kurien Jacob, sold air rights above the through-block site for $11 million to developer Wei Hong Hu, who is now building the 42-story Xadia Hotel at 58 W. 39th St. It is scheduled to open next year. Over the summer, meanwhile, the Refinery’s landlords closed on a $70 million refinancing package with Morgan Stanley. A rooftop bar offers Empire State Building views.
1025 Sixth Ave.
The Garment District once had item-specific subdistricts. Sellers and storers of furs were in the West 20s, while hat-makers, which once numbered in the dozens, clustered near Sixth. In fact, the modest limestone midblock structure at this address, the Millinery Center Synagogue, served as a house of worship for that industry’s workers. Founded in 1934 in borrowed space at 1011 Sixth, the shul, designed by Art Deco architect H. I. Feldman, opened its doors at No. 1025 in 1948. At first the narrow 19-foot-wide, 130-parishioner space reportedly was not intended for regular services but as a place to say prayers for the dead, though it later evolved into a more traditional synagogue. It continues to operate today, even as the Garment District’s presence on Sixth seems to have become as much of an anachronism as men who wear formal hats.
1006 Sixth Ave.
Cohens also own this four-story, 20-foot-wide prewar building, though they are not related to the M&J family of the same name. Stanley & Son Fine Jewelers, founded in 1950, occupied most of No. 1006 from the 1960s to 2006, when the business relocated to the second floor and the sidewalk-level space welcomed a liquor store. In 2023 the jeweler moved again, this time relocating to nearby 1384 Broadway, which allowed the liquor store to take its former berth. In 1979, after years of being a tenant, Stanley Cohen purchased No. 1006, according to the city register. His three children took over the space by way of a limited liability company in 2019, though son Paul Cohen, a jeweler himself, died earlier this year, an obituary shows. The 2,200-square-foot structure, which also contains two apartments, is worth $1.7 million, according to the city, though official appraisals tend to be lower than actual sales values. The building was worth $2.1 million in 2021, records show.
German-American architect Mies Van der Rohe freed the city from the confines of small windows in 1958, when 375 Park Ave. became the first office tower with floor-to-ceiling panes. The concept crossed over into residential real estate, and floor-to-ceiling windows have become a must-have feature for certain discriminating New York apartment buyers.
As the CEO of Skyline Windows, a 103-year-old family business with $100 million in annual sales, Matthew Kraus’ view into this world is crystal-clear. Skyline designed, manufactured and installed the windows at Rockefeller Center, the Chrysler Building, the Pierre Hotel, the San Remo and thousands more.
In Europe, he said, Europeans like their windows framed because frames link buildings to the time before industrialization, before glass towers rose up everywhere, mimicking Van der Rohe’s achievement on Park Avenue.
“A big, beefy frame in Europe is OK,” Kraus said in his Bronx office, near the 138th Street subway station, where the tables are covered with building plans, and the windows are small.
“New Yorkers want as little frame as possible,” Kraus continued. “They also want their windows to do a lot.”
Kraus, who has led the family firm since 2022, said New Yorkers prize windows that really let the sunshine in and block sound. Effectively, they want a permanent silent movie viewable from their apartment. Understandably, they prefer the screen to be as large and unblemished as possible. For that, only floor-to-ceiling windows will do.
They also want windows to let fresh air in but keep dust out. They certainly don’t want panes to hurt animals, so under a city law that took effect in 2021, new buildings must contain glass engineered to be more visible to birds, in an effort to minimize the common avian error of slamming into a building.
Kraus started his career at Skyline in 2008 as a sales project manager. He rose up through the ranks and took responsibilities such as factory improvement and systems development, before he was put in charge of all sales and marketing in 2014. In 2017 he was named president and today runs the show. His father, Steven, is chairman.
This year Skyline sold a 30% stake in itself to Schuco, Europe’s largest European window company, with the intent to acquire, after private equity shareholders Deutsch Capital and Oakmont Capital were ready to sell after eight years.
Opportunity is opening up for Skyline, thanks to a new city law mandating that commercial and residential buildings lower carbon emissions by 2030. But in six years, an estimated 75% of buildings won’t be compliant, and part of the solution could entail replacing drafty windows. Windows are a big expense for buildings; in a new $100 million tower, they can account for 2% to 8% of the cost, Kraus said.
“The good news is, windows last a long time,” he said, “if they’re made and installed right.”
SPINE CARE: Catholic Health will create a Spine Center of Excellence at St. Catherine of Siena Hospital in Smithtown to offer a specialized program to treat back pain and other injuries, the health system said Monday. Plans for the new center include converting 11 hospital beds to exclusively serve spine patients, conducting a technology upgrade to improve patient monitoring and reconstructing an existing operating room to handle spine surgeries. Catholic Health has hired five orthopedic spine surgeons to develop the new center and three physiatrists specializing in interventional pain management.
SOUTH SHORE EXPANSION: South Shore University Hospital placed the final steel beam as part of a major campus expansion that is expected to be completed by 2026. Monday’s event marked progress toward the completion of a new 190,000 square-foot, six-story inpatient tower. Part of Northwell Health, the $468 million project in Bay Shore will expand the facility's inpatient and surgical offerings, with 90 private patient rooms, 10 new operating rooms and three procedure rooms.
CEO SHUFFLE: New York City Health + Hospitals/Bellevue CEO William Hicks will step down on January 6 after leading the hospital for 11 years, the health system announced Monday. H+H's senior vice president and chief quality officer Dr. Eric Wei has been appointed to succeed him. Under Hicks, the hospital's inpatient capacity grew from a pre-pandemic average daily census of 565 patients to 762 today, according to H+H. Wei had recently served as Lincoln Hospital's interim CEO until former Metropolitan CEO Cristina Contreras was tapped to fill the role.
CORRECTION: An article published Monday about the city's planned life science hub in Kips Bay has been updated based on new information from City Hall to reflect that $1.6 billion is the cost of the entire project. The first phase will cost $1 billion, officials said.
Political observers say Mayor Eric Adams may have trouble attracting a health commissioner when the position becomes vacant early next year.
Last week, Health Commissioner Ashwin Vasan announced he would step down in January to spend more time with his family. The timing of the move has placed the Adams administration in a tight spot, having to attract candidates to an agency with a complex mandate while contending with an exodus of other high-ranking officials.
A typical mayoralty with a three-month lead might conduct a national search to find the city’s next top doctor. But public health experts say that would be ill advised given the indictment hanging over Mayor Eric Adams, a potential barrier to getting a competent person in the commissioner's seat.
The administration is unlikely to launch a wide-scale search to find a permanent commissioner given the chaos in the executive branch, said Dr. Megan Ranney, dean of Yale’s School of Public Health. She suspects the next commissioner will be chosen in an interim capacity from within the current administration while the dust around the indictment settles.
“That would be most appropriate and has the highest likelihood of both bringing stability to the department and stability for the city,” Ranney said. “This is not a moment to bring in a new leader and the chance of finding an outstanding new leader is lower given the uncertainty around the mayor right now.”
The administration would not say whether the search for a new commissioner has begun or if it would focus on people outside the department.
“Dr. Vasan will continue to serve as health commissioner through early January 2025, while in the meantime, we are working together to ensure a seamless transition to new leadership," said City Hall spokesman William Fowler. "We will be reviewing all potential candidates and look forward to announcing a new commissioner at the appropriate time.”
Some of the most likely candidates for an acting commissioner would come from the pool of deputies running the department, said one former Health Department official who requested anonymity to discuss the subject.
“The likelihood of having someone really strong come from the outside is pretty negligible," the former official said. "Actually, I would be worried about any outside person who would agree to take this."
Adams has resisted mounting calls to resign amid federal bribery, wire fraud and conspiracy charges. If the mayor were to step down, next in line would be Public Advocate Jumaane Williams, who has championed community-based mental health services non-police approaches to people in crisis.
“Policy remains a question in an administration that’s rattled at the moment,” said political consultant George Artz. But while new administrations often come with new police and fire commissioners, which tend to be more politically tied to the occupant of City Hall, the direction of the Health Department is more insulated from regime change, he said. “If you’re a professional you can get a lot done if you’re in the Health Department.”
Administration officials have said that the mental health and longevity agendas Vasan put in place will continue after he leaves. The person leading much of that charge is the Department's executive deputy commissioner, H. Jean Wright, who would be well-suited to continue it. Eight deputy commissioners currently report directly to Vasan, according to an organizational chart for the Department dated September 2024.
Amanda D'Ambrosio contributed reporting to this story.
Montefiore’s Mount Vernon Hospital will get a major revitalization, thanks to the state’s $41 million capital investment.
The hospital plans to increase capacity in its emergency and operating room as part of a plan to renovate and modernize the facility, according to a joint announcement from Montefiore Health System and Mount Vernon Mayor Shawyn Patterson-Howard on Monday.
The redesign will increase the emergency department’s capacity by 150%, enough to accommodate up to 50,000 visits a year. The hospital also hopes to expand and update its operating rooms to address the need for surgery space. The current lack of space leads to patient transfers, or ORs doubling as gastroenterology units, according to the announcement.
The funding will also be used to update Montefiore Mount Vernon’s Family Health Center’s lobby, exam rooms and support center.
Montefiore serves roughly three million people across ten hospitals and 200 outpatient clinics in the Bronx, Westchester and the Hudson Valley. The health system brought in $7.7 billion in revenue last year, according to the latest financial statement.
The system has recently expanded its footprint outside of its Bronx base; earlier this month, Montefiore announced a $1.5 million expansion of the Burke Rehabilitation outpatient clinic in Purchase.
The growth has raised concerns among residents at Montefiore Medical Center in Van Cortlandt Park, who’ve cautioned that the move into whiter areas could sap resources from facilities that serve more Black and Latino residents. The residents unionized last year and are pushing the hospital to fund a patient care trust to support services for uninsured patients as part of an ongoing contract negotiation.
State Senator Jamaal Bailey and Assemblyman J. Gary Pretlow helped secure the latest funding for Mount Vernon, according to a statement from Patterson-Howard.
The hospital system has not yet filed a Certificate of Need with the state Health Department, according to spokeswoman Vishakha Mathur, which is necessary for major hospital construction.
When Alex Spiro, an attorney for Mayor Eric Adams, filed a motion on Monday to dismiss the federal bribery charge against him, it was not the first time that one of the mayor’s lawyers had made such an argument. A different set of attorneys, from the firm WilmerHale, made many of the same claims in a Sept. 12 letter to federal prosecutors as part of an unsuccessful attempt to stave off Adams’ indictment.
The embattled mayor has hired Spiro’s firm Quinn Emanuel to join WilmerHale as the second high-powered law firm representing him in the case related to alleged travel perks and campaign cash from Turkey that led to Adams’ indictment last week. Adams faces another three known federal investigations plus a decades-old sexual assault claim. Meanwhile, the city’s 800-attorney Law Department is representing Adams in the assault case, along with Spiro.
On Monday, filings revealed that two new Quinn Emanuel lawyers had joined Adams’ defense: William Burck, a veteran lawyer known for representing Republican politicians, and Avi Perry, a former federal prosecutor who joined the firm last year.
It’s not unusual for a public official under fire to bring on multiple firms for their defense. But the addition of a new high-profile law firm promises more considerable costs for the mayor, who has already paid out $878,000 to WilmerHale for representing him since November the probe by the Southern District of New York. Those payments have come from a legal defense fund that Adams created to defray the costs and avoid passing them onto taxpayers.
Adams had raised a combined $1.7 million for the trust as of July; his next disclosure, due Oct. 15, will show his fundraising and expenses in recent weeks, including, presumably, his spending on Spiro’s firm.
WilmerHale still represents Adams in connection with the Turkey probe, a person familiar with the arrangement said. His attorneys from that firm are Brendan McGuire, his former chief counsel at City Hall, and Boyd Johnson, a former federal prosecutor.
Spiro, in a Monday press conference to discuss the motion to dismiss, said that “I will be trial counsel on this matter,” adding that “WilmerHale is still involved.” Speaking at his law firm’s Midtown office, Spiro did not answer questions about when Adams hired him for this case, and what rate he is charging for his services. (In the sexual assault case, Spiro is charging the city a heavily discounted rate of $250 per hour, compared to the $2,000-an-hour fee he has charged other clients.)
Fabien Levy, a City Hall spokesman, said in an email that “the city is not covering the costs of attorneys in this matter.”
Carrie Cohen, a former corruption prosecutor for the SDNY, said in an interview that “it’s always helpful to have more firepower when you’re in a high-profile matter, such as this indictment and ongoing investigation.”
“It is particularly helpful to have someone on board who is used to speaking in public about pending criminal prosecutions,” she added, alluding to Spiro, known for his aggressive defense of celebrity clients such as Elon Musk and Alec Baldwin.
Spiro argued in his motion to dismiss the bribery charge that the indictment failed to prove any connection between the years of discounted flights and hotel stays that Adams received from Turkish officials and his subsequent 2021 attempt to speed up safety approvals for a Turkish consulate building in Midtown. Spiro also said Adams, who was then the Brooklyn borough president and Democratic nominee for mayor, had no authority to exert pressure on the city’s fire commissioner to certify the building — complicating prosecutors’ efforts to paint the intervention as an “official act” performed as a quid pro quo.
“Gratuities are not federal crimes, courtesies to politicians are not federal crimes,” Spiro said. “Congressmen get upgrades, they get free appetizers, they have their iced tea filled up. That's just what happens.”
McGuire and Johnson of WilmerHale had raised similar claims in their Sept. 12 letter to the Department of Justice, which was shared with Crain’s following Adams’ Sept. 25 indictment. McGuire and Johnson argued that the federal courts’ increasingly narrow view of what constitutes corruption would make it impossible for the charges against Adams to hold up in court.
“A close evidentiary case that does not include an express betrayal of the public trust, a logical quid pro quo, or an explicit motive to be influenced will be questioned by the courts and the public, especially given the consistent media coverage of confidential details of the investigation over the past ten months,” the attorneys wrote in a letter to Lisa Monaco, the deputy U.S. attorney general.
Legal representation has been a significant issue in Adams’ City Hall. His top aide Timothy Pearson — who is among the officials whose cell phone was seized Sept. 4 — has also been named in four sexual harassment lawsuits by former colleagues and subordinates. Pearson has been receiving taxpayer-funded representation in those cases, a decision that was a factor in the June resignation of corporation counsel Sylvia Hinds-Radix, Politico reported. (City Hall has strongly denied the report.)
Adams’ own chief counsel Lisa Zornberg resigned abruptly 11 days after federal investigators seized phones and searched the homes of several City Hall officials. She reportedly quit after the mayor refused her advice to fire Pearson and other aides whose homes were searched.
Both of those top legal jobs — corporation counsel and chief counsel — are now vacant. Adams nominated the veteran lawyer Randy Mastro to be corporation counsel, which oversees the Law Department, but Mastro withdrew from consideration Sept. 10 after a contentious City Council hearing showed that lawmakers were poised to reject him. The mayor has not said who he now plans to pick for either role.
Gov. Kathy Hochul said she fully expects a strike by dockworkers to go ahead, which will halt operations at East and Gulf coast trade gateways including the Port of New York-New Jersey, the nation’s busiest Atlantic hub for international commerce.
“The food supply is secure right now,” Hochul said during a press conference Monday, while urging people not to rush out to grocery stores to stockpile supplies as they did during the pandemic.
The U.S. Maritime Alliance, a group known as USMX that represents ocean carriers and port terminal operators, and the International Longshoremen’s Association have no talks planned before their contract expires at midnight — setting the stage for a strike to start Tuesday.
In a statement on Monday, the ILA said USMX “continues to block the path toward a settlement” on a new contract and “seems intent on causing a strike at all ports from Maine to Texas beginning in almost 12 hours.”
JPMorgan Chase transport analysts estimate the shutdown of eastern and Gulf ports could have an economic impact of between $3.8 billion to $4.5 billion a day, “some of which would be recovered after a return to normal operations over time.”
Hochul said about 47,000 workers are set to strike, including 4,500 in the New York and New Jersey area. While there are supplies and consumer goods in warehouses, residents could start seeing depleted store shelves if there’s a prolonged stoppage of a few weeks, officials said.
“We’re deeply concerned about the impact that a strike could have on our supply chains, especially when it comes to critical goods like medical supplies and others,” Hochul said.
The governor said state agencies have been working with the supply chain industry to get cargo off ships and out of port terminals ahead of the potential strike.
Rick Cotton, the NY-NJ Port Authority’s executive director, said the facility anticipates close to 100,000 containers will be stored at the NJ-NJ port and remain there for the duration of the strike. The 35 ships coming in or arriving at the port over the next week are expected to go to anchorage.
Car dealers
Automobile shipments may be caught up in the disruptions. “If you’re expecting to be able to get a new car this week, it may be something you want to check with your dealer,” Hochul said. “It may not be arriving, for example, in the next few weeks.”
Hochul said shipments of semiconductor chips may also be halted. “There’s a lot of areas where people may not have anticipated a disruption, but we have. We’re working closely with the industry,” she said.
Brian Dodge, the president of the Retail Industry Leaders Association, urged both sides to return to the negotiating table and called on the Biden administration to stay engaged by considering “all options” to keep the U.S. economy going.
“Shoppers can rest assured holiday merchandise will be on shelves,” Dodge said in an emailed statement Monday. “However, the longer this work stoppage goes on, the harder it will become to shield customers from its effects.”
President Joe Biden said Sunday he wouldn’t intervene in any dockworkers strike. Resolving the dispute is a matter for collective bargaining, he told reporters in Delaware.
Hundreds of thousands of Verizon customers are without mobile service Monday as the massive telecommunications company says it is addressing the ongoing issue.
"Our engineers are engaged and we are working quickly to identify and solve the issue," the company wrote in a post to X just before noon ET.
Downdetector.com, which tracks outages across service providers, saw issue reports skyrocket around 10 a.m. ET. More than 100,000 customers have since reported issues to the site.
Customers in the Midwest appeared to be the first affected by the outages, though outages have been reported across New York and other major cities.
Many customers affected by the issue report seeing "SOS" alerts atop their cellphones, meaning they are not connected to the cellular network.
Verizon, which markets itself as "the network America relies on," has not provided an estimate for when services will be restored.
Gov. Kathy Hochul has tapped a financial management services company in Georgia to take over New York’s popular $9 billion home care program, following months of rumors that the firm would nab the contract.
Public Partnerships LLC, otherwise known as PPL, won a highly sought-after state contract to run the state’s Consumer Directed Personal Assistance Program, a Medicaid-funded home care program that allows New Yorkers to hire their own caregivers — including family members — that get paid by the state to provide home-based services.
The agreement requires PPL to work with four regional organizations to handle payroll and other administrative functions for the program, as well as a network of 30 home care agencies. The Chinese American Planning Council, based in the Lower East Side, will help manage the program in New York City, Long Island and Westchester County.
PPL will also move its headquarters to New York as a part of the deal, according to the governor’s office. The move will create 1,200 new jobs for New Yorkers, on top of the home care aides that are already working statewide.
The governor’s office did not immediately return a request for comment about the amount of money it will award to PPL and the subcontractors to take over the program.
The contract award marks the latest development in Hochul’s controversial plan to overhaul the home care program and cut costs. The governor greenlit a last-minute plan in the budget to whittle down the number of middlemen companies, known as fiscal intermediaries, operating the program from up to 700 to one. But advocates and the businesses who operate the program currently have opposed the change, stating that it will upend care for 250,000 New Yorkers.
Meanwhile, PPL has been making moves to get the contract. Earlier this year the company sent out teaming agreements to existing fiscal intermediaries, offering the agencies a potential subcontract should they become the sole administrator of the program. PPL also put up a job listing for a New York financial services director to oversee the transition.
PPL has a checkered history managing similar home care programs in other states. In Pennsylvania, for example, the state’s auditor general in 2013 found that PPL was not prepared to become the state’s sole financial administrator of the consumer-directed home care program after it failed to pay many direct care workers and left patients without appropriate resources to get care.
Vince Coppola, PPL’s president and CEO, said in a statement about the new contract that the company’s focus is to ensure “minimal disruption to consumers and caregivers” as it transitions to administering the home care program.
Léman Manhattan Preparatory School, the city’s only boarding school, serves families who want their kids to learn and live with a view of the harbor and the Statue of Liberty.
Tuition, room, board and fees were $93,000 per pupil for the 2021-22 school year, according to a brochure from the Financial District school. Tomorrow’s lunch menu for students attending the lower school is chili lime fish tacos or bean tacos with jasmine rice, served with shredded cabbage, salsa and avocado crema. The head of communications and enrollment management, Paige Murphy, said: “Léman is experiencing record revenue and the highest retention rate in its history.”
It is also experiencing a fierce fight with its landlord.
Léman hasn’t paid rent since June 2023 for about 200,000 square feet of space at 25 Broadway, even though its lease doesn’t expire until 2030, Moody’s said in a report last week. Owner BF&W Realty Co. is part of Wolfson Group, a family enterprise that controls 2 million square feet of space in New York, according to a report from credit-rating firm KBRA. Principal Morris Wolfson didn’t return a call.
Murphy said Léman and landlord are “proactively collaborating to develop mutually beneficial lease terms” and an agreement is expected “soon.”
That would be great news for investors in 25 Broadway’s mortgage looking at a nearly 50% loss since the $250 million loan came due in April, Moody’s said. About 30% of space was available as of February, said KBRA, adding the landlord indicated there was “no clear path toward refinancing.”
25 Broadway is a 22-story building that holds 1 million square feet and was developed in 1921. It used to be called the Cunard Building and in its ornate hall passengers booked tickets aboard the Queen Mary. WeWork moved out in 2021 and Teach for America shrank its footprint, KBRA said. Now that Léman is effectively on rent-strike, Moodys’ said revenue and net operating income are under further pressure. The building housed middle and high-school classrooms, according to a securities filing.
At least for now, Wolfson and lenders have decided to kick the can.
In return for a $7 million payment, lenders recently granted Wolfson a 24-month forbearance agreement with a potential six-month extension, Moody’s said. Throughout the agreement 25 Broadway’s mortgage will be considered current, “with the borrower continuing to lease up the property.”
Léman seems positioned to command a substantial drop in rent, considering the vacancy rate in nearby buildings is 27%, according to a Cushman & Wakefield survey of the Financial District. The school was founded in 2005 as Claremont Preparatory School and acquired in 2011 by Meritas, a group of 10 schools for 12,000 students worldwide owned by Chicago-based private-equity firm Sterling Partners. Meritas sold several schools in 2015, but it’s not clear if it kept the Manhattan location.
A call to Sterling wasn’t returned.
A former top executive at Tommy Hilfiger is hoping that his NoHo condo will be a fashionable choice for buyers.
Ex-Vice Chairman Fred Gehring, who in 2006 helped orchestrate the casual apparel giant’s $1.6 billion sale to buyout firm Apax Partners, has put his three-bedroom unit at 41 Bond St. on the market for $9.8 million, according to a listing that appeared Monday.
The 2,600-square-foot home, which features three and a half baths, a great room with a balcony and a primary suite with a walk-in closet, cost Gehring $7.1 million in 2011, according to the city register.
In 2010 the developer DDG completed the condo building, a boutique nine-unit offering between Bowery and Lafayette that sports an unusual bluestone facade.
Initially focused on the European expansion of a company once known for its blue jeans, Gehring was tapped in 2006 to be Hilfiger’s chief executive officer and went on to hold several high-level management jobs within the company even as its ownership changed hands a few times.
Four years after Apax acquired Hilfiger in an effort to take it private, a time of major growth—its store count reportedly jumped from about 600 to 1,000 over that span—Apax unloaded Hilfiger to Phillips-Van Heusen Corp., the fashion conglomerate also known as PVH, for $3 billion. The Madison Avenue-headquartered PVH also owns Calvin Klein, which it acquired in 2003.
Gehring, a native of Holland, left PVH in 2016 to co-found Amlon Capital, a Netherlands-based investor in fashion businesses such as Karl Lagerfeld and DKNY. Gehring serves as a partner at Amlon today.
In 2019 Hilfiger, under CEO Daniel Greider, closed its decade-old, 22,000-square-foot flagship store at 681 Fifth Ave. in Midtown during a period when other apparel brands were rethinking brick-and-mortar locations in the face of the surge in online shopping. Gap, Versace and Henri Bendel all shuttered locations on Fifth around that time. Hilfiger was founded in 1985.
But in the past year, fashion companies have begun snapping up prominent storefronts on the same street in an apparent bid to control steep rent costs, among them Prada and Gucci parent Kering.
Clif Thorn, the agent with Douglas Elliman who is listing Gehring’s home, had no comment by press time.
Leases
Fintech firm extends and expands in Midtown South
Address: 28 and 40 W. 23rd St., Manhattan
Landlord: Williams Equities
Tenant: Ramp
Lease size: 132,000 square feet
Asset type: Office
Brokers: Cushman & Wakefield's Michael Mathias and RJ Johns represented the tenant. Colliers International's Mac Roos, Andrew Roos, Michael Cohen and Jessica Verdi represented the landlord.
Orthodontics practice takes space on Upper West Side
Address: 424 West End Ave., Manhattan
Landlord: Manhattan Skyline Management Corp.
Tenant: Inspire Orthodontics
Lease size: 1,357 square feet
Asset type: Medical
Brokers: Dr. Richard Hittman represented the tenant. Joshua Roth represented the landlord in-house.
Sales
Upper East Side rental buildings change hands
Addresses: 1382, 1384 and 1386 Second Ave., Manhattan
Seller: Copperwood Real Estate
Buyer: The Torkian Group
Sale price: $25 million
Asset type: Mixed-use
A Harlem-based youth tennis nonprofit is launching a major expansion effort.
The Harlem Junior Tennis & Education Program hopes to more than double its footprint with a second location in the neighborhood, a $50 million project that will ideally span a full city block. The organization currently serves more than 800 youths with a wait list of 500 more. The new location, which is still being sought, would triple its capacity, allowing it to serve about 2,500 children per year.
"If we can get that one city block, that will be great," said Katrina Adams, executive director of the nonprofit, "but we'll do what we have to based on the space that we get to create the facility that we need."
The program is based at the Harlem Armory Center on West 143rd Street, between Fifth Avenue and Malcolm X Boulevard. It has four tennis courts at the Armory and looks to have 16 at its new facility, eight outdoors and eight indoors. The building, as planned, would also include classrooms, locker rooms, a cafeteria, community space and administrative offices.
The new facility would add to the organization's space at the Armory, not replace it. It would also be the first public indoor tennis facility in Manhattan, according to Savills, the brokerage advising the tennis program on its expansion efforts.
The organization is open to whatever type of real estate deal will bring this expansion to fruition, whether that ultimately means buying space, leasing space or partnering with another group, said Savills Vice Chairman Arthur Mirante. It is also preparing a comprehensive request for proposals that it will send to Harlem's real estate and business communities after the board approves it and plan to sell the facility's naming rights as part of the capital campaign, he said.
The tennis program dates back to 1972 and emphasizes education along with athletics. Its students maintain an average grade point average of 3.1, and 25% earn collegiate tennis scholarships, according to the organization.
Turns out some U.S. cities' pandemic exoduses were not as drastic as they seemed. Plenty of people did pack up and move from many of the country's major metropolitan areas, but with three years hindsight, it appears the fleeing—at least for some cities — was overhyped.
The same cannot be said for New York. Here, the pandemic exodus really was intense, at least in a few key ways. Net migration out of the city doubled during the public health emergency, and some of the New Yorkers who jumped ship did so with their pockets full of cash.
That's according to a recent Brookings Institution analysis of IRS data on where people filed their taxes from one year to the next. The report suggests the long-term economic and population impacts of New York's exodus may prove relatively insignificant—but it shows the magnitude of the migration spike out of the city was no exaggeration.
Even before the pandemic, New York long lost more tax filers than it gained. The city was in the red every year for the last decade, though at varying rates. In 2014, for example, the city saw a net outflow to the tune of 58,000. The next: a relatively mere 43,000.
But if years prior were New York's out-migration stuck on an uneven downslide, the pandemic was like it falling off a cliff.
New York was not the only major metro area to see this trend. Los Angeles and Boston, for example, saw similar spikes. San Francisco also experienced an outsized outflow.
But many other cities, like Chicago and San Diego, for example, saw much tamer responses relative to New York. "Aside from the major metro areas of New York, Los Angeles, and San Francisco, however, there were few truly seismic shifts in metro-to-metro migration between the pre-pandemic and post-pandemic-onset periods," the report said.
For New Yorkers on the move, Miami was by far the top destination. No two cities saw a bigger increase in the net numbers of people moving between them, according to IRS data.
"In the two years prior to the pandemic, the New York metro area had a total net loss of 11,700 tax filers to the Miami metro area; in the two years after the pandemic’s onset, that loss more than doubled, to 26,900," wrote Alan Berube, who conducted the study for Brookings.
Florida has long been a popular change of address for New Yorkers of upper income brackets in large part because it does not levy state income taxes. In 2023, a move from New York to Miami would save a person with a $100,000 salary an estimated $37,000 a year, according to SmartAsset data. For those earning $250,000, the savings were $88,000. Jump up to the $650,000 bracket and it's more like $195,000 saved.
Miami also pitched itself as a safe haven away from pandemic-related restrictions just as hybrid work allowed many so-called supercommuters to spend more time away from the office. Snowbirds who previously spent just a few weeks or months outside the city now had a legitimate shot at spending half the year in Florida while keeping their desk job in Manhattan.
New York represented four of the five largest absolute changes in metro-to-metro migration immediately after the pandemic, Berube's report found, with the other biggest outflow increases from New York going to Bridgeport, Connecticut; Philadelphia and Orlando, Florida. The city was already losing thousands of residents to these cities, even accounting for the two-way street of folks coming in—but the disproportionate rate of outflow skyrocketed after the pandemic.
Still, much of the Brookings report argues the actual impact of these changes will prove relatively insignificant. That is particularly true for Berube's argument about the broader economic effect—or lack thereof—of metro areas losing out on these tax filers. And even with New York's particularly large pandemic-induced outflow spike, much of his thinking still applies.
People who moved out of New York in the years before the pandemic actually earned about 15% less than non-movers, he found. In the year after the pandemic, the average movers' income superseded the non-movers by about 5%. "A number of very high-income households seem to have moved from New York to Miami after the pandemic’s onset," the report said.
That's notable, of course, but Berube wrote there is not much there-there from an economic perspective in the grand scheme of things. While the incomes of people leaving major metro areas tended to be bigger than before the pandemic, so too were those of folks coming in.
"The New York metro area registered a net aggregate loss of $46 billion in (adjusted gross income) due to migration in 2020-21 and 2021-22," he added. "Yet in 2022, the metro area’s total AGI among 'non-movers' was $125 billion higher than in 2020."
Plus, the extreme population bleeding was only temporary. The IRS data runs just through 2022, but the city's net outflow cooled to 114,000 at the end of the year. That's within a rounding error of the 113,000 outflow the city saw in 2017, an otherwise normal year.
The latest U.S. Census Bureau data gives us a more up-to-date read on where things stand. Per their estimates, New York City saw net out-migration of about 78,000 residents between 2022 to 2023.
It should also be noted that domestic migration is just one of many factors that determine overall population trends. Urban centers like New York can see their negative domestic migration offset by other factors, such as having a high birth rate or a strong international appeal. New York is unlikely to see significant population decline as a result of domestic out migration, at least not at the rate it's at now.
"This analysis of metropolitan migration during the pandemic suggests neither cause for alarm nor reason to shrug off the potential impacts of newer movements," Berube wrote. "Rather, it points to underlying metropolitan challenges and opportunities these recent trends re-reveal, and imperatives to address them as U.S. cities and regions find their new normal."
New York’s largest accounting firms’ growth may finally be leveling out; their headcounts increased by an average of just 6.8% in 2024, down from a 12% uptick last year and a 34% jump in 2022.
The average firm size across Crain’s list of largest accounting firms, which is ranked by number of New York–area accountants, is a little over 2,100.
This slower growth in local accountants is consistent with the industry’s workforce shortage. The industry faces headwinds in recruiting and retaining talent, largely due to fewer students and graduates entering the profession, plus those who leave the field because of burnout or low pay, according to the CPA Journal.
The number of students who earned a bachelor’s degree in accounting in the 2021-2022 school year fell 7.8% from the previous year, according to the American Institute of CPAs. The number of students who earned a master’s degree in accounting fell 6.4%.
Meanwhile, the city’s Big 4 accounting firms held their recurrent spots from last year’s ranking, with only KPMG reporting a slight dip in accountants. Of the Big 4, Ernst & Young saw the greatest increase in headcount, 5%.
Some individual firms on the list that saw notable growth from last year include Sax LLP (No. 20), which reported over a 40% uptick in local accountants. PKF O'Connor Davies (No. 8) follows, up 22% since 2023, and then Citrin Cooperman Advisors LLC (No. 9), up 21%.
CBIZ (No. 13) saw the greatest decrease in accountants on the list, down 11.6% from last year. Crowe (No. 16) follows with a 9.5% dip.
Combined, these top 25 firms employ about 52,800 accountants in the New York area. For the full ranking, head to Crain’s Data Center. The list includes local accountant headcounts, 2023 revenue and more.
Missed your chance to make the list? Submit here for future consideration.
Mayor Eric Adams vows to remain in office despite the serious criminal charges brought against him on Thursday by the U.S. Attorney for the Southern District: bribery and circumventing federal laws meant to limit the influence of foreign nationals on U.S. elections.
This is a moment when the governance of New York City’s 8.3 million residents demands unwavering concentration. Yet the functions of city leadership are overshadowed by scandal and suspicion. It's up to the mayor to prove he can juggle the charges he's facing, which he denies, along with the exodus his administration is seeing and the big responsibilities of his job as mayor.
News of FBI raids and federal indictments marks a profound dysfunction in the city administration. This month alone, four top officials have submitted their resignations: Schools Chancellor David Banks, Health Commissioner Dr. Ashwin Vasan, NYPD Commissioner Edward Caban and chief legal counsel Liza Zornberg.
The Adams administration is on its third police commissioner in less than three years, a turnover rate not seen since the days of Mayor James J. Walker in the 1930s. Such instability inevitably trickles down, affecting every facet of government and threatening critical initiatives like the mayor’s ambitious City of Yes housing project. Nick Garber's reporting for Crain’s highlights a grim picture: a cornerstone policy meant to address the city's dire housing needs is now undermined by the administration’s near-complete loss of political capital.
The spectacle of successive police commissioners and other high-ranking officials stepping down is not merely a bad look — it's a blow to continuity. How can policies be carried out if the leaders are constantly in flux? The resignations and criminal charges directly impede the city’s progress.
If Adams is sincere in his pledge to carry on as mayor, he must do more than offer platitudes like "Stay focused, no distractions and grind." Leadership is measured by the ability to maintain the course despite adversity, to shepherd vital projects to completion, and, most importantly, to foster an environment of stability and trust both within the government and among the public.
As New Yorkers we must demand accountability. We need a mayor who cannot only envision bold solutions for issues like housing, the migrant crisis and post-pandemic real estate upheaval, but who can also navigate the complexities of governance without risking federal probes and losing key players.
In the face of ongoing investigations and the decline in administrative coherence, it’s the duty of everyone in city government to ensure that the city is not just functional but resilient amid these disruptions. This is not merely about one man's political career; it's about the well-being of millions who call this city home.
The city-backed technology training center Civic Hall has received a $15 million gift that will allow it to build out its Union Square space, expand programming and rename its facility after the donor: the late computing pioneer Bernard Goldstein.
Civic Hall opened in October 2023 on the bottom six floors of the new office building Zero Irving, following years of construction spearheaded by the city’s Economic Development Corp. Initiated under Bill de Blasio, the project has been embraced by Mayor Eric Adams’ administration as a space to train the city’s diverse workforce for high-paying tech jobs.
The gift, details of which were shared with Crain’s, exceeds the center’s roughly $10 million annual budget and has led its owners, the Fedcap Group, to rechristen the Union Square facility as “Civic Hall – The Bernard Goldstein Center.”
Civic Hall will use the gift to complete renovations to classrooms and meeting spaces, and develop more programs such as partnerships with the city’s big technology companies.
“It’s an amazing opportunity to realize the vision of this project,” said Christine McMahon, president and CEO of FedCap, a workforce-oriented nonprofit that acquired Civic Hall in 2021. “It’s really going to help us build out an ecosystem where individuals seeking training and opportunity are going to be in the same room, same space with some of the largest tech companies in New York City.”
Civic Hall occupies its space at 124 East 14th St. under a 25-year lease that began in 2023. It serves as the anchor tenant in 21-story Zero Irving, an office building constructed on a city-owned site by EDC and RAL Development.
Bernard Goldstein, the center’s new namesake, co-founded an early computing company in 1958 and became “a champion of the growing ‘software industry,’” according to a 2023 obituary following his death at age 92. He also was an executive at Broadview International, a leading mergers and acquisitions firm in the software industry, and served on the board of Apple in the 1990s.
The gift to Civic Hall came from his widow, Pat, and their three children. Pat Goldstein said in a statement that she was inspired by the center’s “mission to drive lasting change through technology.”
“Our family is proud to support Civic Hall’s dedication to digital inclusion, and I know Bernard would be deeply honored to have his name associated with such a meaningful institution,” said Goldstein, who will also join Civic Hall’s board of directors.
McMahon said the organizers of Civic Hall have set a goal of serving 3,000 people a year from the Union Square space, with a focus on providing training to people who face barriers to economic mobility.
Kings County Hospital Center plans to expand its ambulatory surgery unit as the facility braces for greater demand from the total or partial closure of SUNY Downstate.
While the expansions are not directly related to SUNY Downstate medical center, according to Health + Hospitals spokesman Chris Miller, officials have been sounding the alarm for months that the safety net hospital is at capacity and would need greater investment to support the coming wave of patients. Officials have said the increased traffic at Kings County is in part the result of a reduction in services at SUNY Downstate, which Gov. Kathy Hochul sought to close and replace with an outpatient clinic.
SUNY Chancellor John King has said that officials are still exploring options to scale the hospital down, even though state lawmakers rejected the plan in April. An advisory board was established on paper to plan the future of the facility, but its members have yet to be publicly announced.
H + H Kings County is not waiting for that shoe to drop. On Thursday, the H + H board approved a $6.4 million contract to add two new operating rooms for a total of 12 rooms to accommodate an expected 3,000 additional surgeries a year. The contract went to Midtown-based Vanguard Construction and Development Co. to convert the facility’s unused cardiac catheterization lab. The rooms would allow more outpatient procedures and help meet the needs of new programs like bariatric surgery, officials said at a meeting earlier this month.
At a preliminary budget hearing in March, president and CEO Mitchell Katz told the City Council that Kings County and Bellevue hospitals would both need renovations were SUNY Downstate to close. If given the funding, the system could renovate an emergency ward at Kings County to take another 50 to 70 patients “if that becomes necessary.”
Kings County and Bellevue hospitals are already the most crowded hospitals in the system, “substantially over” their pre-pandemic censuses, Katz said at the time.
“We think that that’s related to recent hospital closures or diminishments,” he said. In the case of Kings County, that included a reduction in services at SUNY Downstate that had already begun.
DRINKING WATER: Gov. Kathy Hochul has allocated $90 million to identify and replace lead service lines statewide to improve residents’ drinking water. Lead, which can cause health issues such as high blood pressure or kidney dysfunction, can enter drinking water when pipes break down and release the toxic substance. The new funding will be delivered to local governments to support lead service line replacement projects funded in part by the federal government, with the Bronx, Brooklyn and Queens set to receive a combined $28 million.
MEDICARE ADVANTAGE: City retirees and advocates plan to protest in front of City Hall today to push Mayor Eric Adams to ditch his legal battle forcing retired municipal workers onto Medicare Advantage plans. Since 2018, the city has tried to implement a cost-cutting measure to switch retirees from traditional, government-funded Medicare insurance to a private Medicare Advantage plan – a change retirees say would provide worse and more expensive health care. The push to privatized insurance has been rejected by two courts, and the United Federation of Teachers, one of the largest unions in the city, pulled its support for the mayor’s plan earlier this year. The city has filed an appeal to stop the shift from going through.
BOARD OF HEALTH MEETING: New York City’s Board of Health is scheduled to meet today to discuss changes to the city’s health code. The meeting, set for 1 p.m., will take place at the Health Department’s headquarters in Long Island City and be live-streamed here.
It’s not easy being the city’s doctor.
City Health Commissioner Dr. Ashwin Vasan said last week that he’ll resign by the end of the year, citing personal reasons. The announcement, which came just days before Mayor Eric Adams was indicted by federal prosecutors on criminal charges, means that one of the most prestigious jobs in public health will soon be seeking candidates.
The high-profile job has seen an unusual amount of churn in the years following the pandemic. Vasan’s resignation marks the third city health commissioner in recent history to leave their post after serving for less than three years. While some turnover in the role is expected as administrations change, health commissioners must perform a particularly challenging balancing act: keeping the biggest city in the U.S. healthy while adhering to the mayor’s priorities.
Every mayor comes with a different set of policy priorities and budgetary constraints – and it’s up to the commissioner to become adept at figuring out where public health fits in, one former city Health Department official said, who requested anonymity to speak candidly about the dynamic.
For example, Adams’ policy agenda of public safety bleeds into a top public health concern: severe mental illness. One of the mayor’s leading initiatives was a directive that relied on police officers and others to involuntarily transport people with severe mental illnesses to psychiatric facilities – a controversial strategy that has come to define his approach to the mental health crisis. Vasan, who has a background in mental health, has not spoken out against the mayor’s tactics, but has promoted boosting housing, community-based care and access to psychiatric beds in hospitals to address severe mental illness.
The challenging relationship between mayors and health commissioners is perhaps best illustrated by the pandemic, when public health officials were thrust into a new stratosphere of public scrutiny, forcing them to contend with backlash from stay-at-home orders and misinformation about new vaccines.
“Covid-19 certainly raised the profile of the role of commissioner, as it did for public health officials all over the world,” Vasan said in an emailed statement to Crain’s. “This increased notoriety has come with additional demands of the people who have the privilege of serving as commissioner, and it has certainly demanded much of me, and my family.”
Relationships between heads of government and commissioners took a hit as mayors and governors worried more about what would get them re-elected than what empirical evidence was necessary to keep the public safe, said John Kaehny, executive director at the government watchdog group Reinvent Albany.
“Their world is not empirical,” Kaehny said. “They are not evidence-based, they are special-interest based.”
Those competing priorities have led to departures. Dr. Oxiris Barbot, who served as city health commissioner from 2018 to 2020, abruptly left office after the first wave of the pandemic because of escalating tensions with former Mayor Bill de Blasio. The clash reportedly stemmed from the former mayor’s decision to move a vast citywide contact tracing program to detect infections – a core function of the Health Department – to the city’s public hospital system.
Barbot expressed “deep disappointment” in the de Blasio administration’s handling of the pandemic in a resignation email reported by the New York Times, stating that “the health department’s incomparable disease control expertise was not used to the degree it could have been.”
Barbot was named acting health commissioner after the departure of Dr. Mary T. Bassett, who served under de Blasio from 2014 to 2018. Bassett left for a faculty position at Harvard, and was appointed by Gov. Kathy Hochul to lead the state Department of Health in 2021 – a position she stayed in for just over a year. The former commissioner was criticized for reportedly resisting efforts to investigate nursing home deaths under former Gov. Andrew Cuomo.
Within a day of Barbot’s resignation, she was swiftly replaced by Dr. Dave Chokshi, who at the time led population health at New York City Health + Hospitals. Chokshi served as commissioner for two years, vacating the post when Adams was elected mayor and brought on Vasan to lead the agency.
In response to questions from Crain’s about the challenges of serving as city health commissioner, Chokshi called his former role “one of the best jobs in public health.”
“You get to wake up every day with the sole goal of saving as many lives and preventing as much suffering as possible,” Chokshi said in an email. “You get the tangibility and accountability of local government combined with the scale and visibility of New York City.”
Recent health commissioners have had less autonomy to pull off a robust public health agenda compared to those under Mayor Michael Bloomberg’s administration – often regarded as the “glory days” of public health, the former Health Department official said. Bloomberg launched a series of public health initiatives ranging from anti-obesity efforts to a ban on smoking that led in part to reduced rates of tobacco use among city residents.
“Bloomberg was and remains a public health mayor,” they said. “No one else even gets close.”
Despite leadership changes at the top, thousands of city health workers keep the Health Department’s programs – and mission – afloat, said Dr. Isaac Weisfuse, a former deputy health commissioner under Mayors Ed Koch, David Dinkins, Rudy Giuliani and Bloomberg.
“They offer the continuity that sometimes leadership can’t,” he said.
Ethan Geringer-Sameth contributed reporting to this story.
New York City has awarded a hefty contract to construction giant Skanska to help transform five acres of Kips Bay into a life sciences research hub.
The international firm will receive $1.6 billion to conduct the first phase of the project aimed at expanding the city’s life science footprint, according to City Hall spokesman William Fowler. The Science Park and Research Campus is a key pillar of Mayor Eric Adams’ recovery agenda with the goal of creating 15,000 jobs and bringing $42 billion of economic activity to the city over the next thirty years, according to the administration.
While the administration’s leadership has been thrown into chaos by the mayor’s historic federal indictment, Deputy Mayor Maria Torres-Springer said the contract award signaled the city is “moving full speed ahead” on one of Adams’ signature infrastructure plans.
The project is part of a larger plan to generate $95 billion of economic activity by developing Hunts Point, Governors Island, the Brooklyn Navy Yard, Kips Bay and Staten Island’s North Shore.
The first phase of construction will focus on the educational components of the Kips Bay plan, according to Torres-Springer.
Skanska will oversee the demolition of Hunter College’s Brookdale School of Nursing Campus and the development of the first 600,000 square feet of space for CUNY and a new public high school focused on health and science. The company will also manage the construction of a pedestrian bridge over FDR Drive at 25th St. The plan is to ultimately include a new public square and flood protection measures.
The city got community board approval this month and the project is now under review by the Manhattan borough president’s office. The goal is to complete the city’s lengthy land use process by February and start construction by the end of 2025, said Torres-Springer.
The first phase of the project is expected to be completed by 2030 with the latter stages finishing in 2031, Fowler said.
This is not the first major project Skanska has overseen in New York City. The company was part of a $198 million initiative to build the East Midtown Greenway and carried out a project as part of the Staten Island North Shore Action Plan. Skanska is involved in the reconstruction of the city’s Public Health Lab, which is relocating as part of the Kips Bay transformation.
The second phase of the project will focus on more commercial aspects of the Kips Bay initiative, Torres-Springer said, namely one million square feet of life sciences real estate. It will also include a new outpatient clinic at Bellevue Hospital, along with a nursing simulation center. The Office of Chief Medical Examiner will also get a new forensic pathology center and forensic toxicology laboratory.
During the height of the pandemic, women lost 12.2 million jobs — a massive blow to diversity, talent retention and productivity. While some have gone back to work, many have elected not to return, leaving today’s workforce short 617,000 women.
Employers are taking steps to reverse this trend by investing in holistic women’s health, but there’s still work to be done to close gaps in care. In fact, a recent study of women in the workforce found that health care benefits are the most important consideration for women when choosing where to work— 83 percent listed it as their top priority. Yet only 10 percent of employers perceive that offering leading health care benefits is the most impactful lever to attract talent from diverse backgrounds.
At Aetna®, a CVS Health ® Company, we offer proactive, flexible support for women’s unique needs at every life stage. And comprehensive support isn’t just good for women, it’s good for business.
When employers prioritize a broader definition of women’s health, it results in:
· Increased productivity and reduced financial losses
· Better outcomes and decreased medical costs
· Improved employee satisfaction and retention
· Attained diversity, equity and inclusion goals
Holistic women’s health is more than reproductive and maternal care
Women play a vital role in our economy, making up nearly half of the U.S. labor force. Yet, they continue to face persistent barriers to accessing adequate health care, leaving essential needs unmet. This is partly due to the conventional understanding of women’s health that focuses too narrowly on reproductive and maternal health.
Compared to their male counterparts, women experience distinct health challenges that include but extend beyond reproductive and maternal health. For example, in addition to sex-specific conditions like endometriosis and menopause, women are disproportionally affected by conditions including migraines and depression and experience some conditions, like heart disease, differently than men do.
Consider these staggering statistics:
- 80 percent of people impacted by autoimmune diseases are women
- 80 percent of women experience disruptive quality-of-life symptoms during the transition to menopause
- 80 percent of Americans with osteoporosis are women and ~50 percent of women 50 years old and older will develop the disease
- The number-one cause of death for women in the U.S. is heart disease
To address disparities in women’s health, the National Institutes of Health has called for investment in holistic care that centers on women's physical and mental well-being across all stages of life. Because employer-sponsored benefits are the most common source of health benefits in the United States, covering more than 70 percent of workers, employers have an important role to play in advancing women’s health equity.
Employers are powerful advocates for health equity
Top workplaces understand that half of their employees can’t bring their best selves to work if their health care needs aren’t met. These organizations consider the issues that matter most to women across all stages of life and incorporate best-practice approaches to workplace benefit design that address these concerns.
Employers seeking to evaluate their benefits strategies for women’s health equity should consider the following:
1. Physical health. Do my employees have simple, affordable access to high-quality preventive care and treatment for illnesses when and where they need it?
2. Mental health and well-being. What options do my employees have to seek help with behavioral health concerns? Are we offering wellness programs like nutrition counseling and tobacco cessation?
3. Reproductive health. Are my company’s benefits inclusive of comprehensive reproductive services, like maternity care and life-saving screenings?
4. Healthy aging. Is our company culture supportive of women through health issues they are uniquely affected by, such as menopause? What resources are included in our benefits package to help with healthy aging?
Because women face ongoing barriers when they seek these types of care, thoughtful and holistic benefit plans can make health more accessible, easier and affordable.
Aetna helps unlock the power of women’s health
Supporting women’s mental and physical health means offering health plans that consider a woman’s biology and environment throughout her life—not just during her reproductive years. Aetna has solutions in place to help employers do just that.
- We have a proven history of leading the progression of women’s health care. Aetna is the first major insurer to offer intrauterine insemination (IUI) as a medical benefit for eligible plans. Members may access this benefit as a test of fertility and, in some cases, to increase the chances of pregnancy.
- Our extensive MinuteClinic ® footprint makes “anytime, anyplace” care even more convenient. Women’s health services (like birth control prescribing, mastitis treatment and screenings for breast and heart health) are within local reach. Members also have access to 24/7 virtual care and mental health care support seven days a week through MinuteClinic.
- We connect members with thorough, specialized services across life stages. Not only do we have one of the largest nationwide provider networks, but we also partner with leading companies that offer tailored women’s health services. For instance, Maven Clinic delivers specialized pregnancy and postpartum support and connects women with doulas, mental health specialists and lactation consultants as part of our maternity program. We also collaborate with Gennev, the nation’s largest virtual menopause clinic, provides in-network clinical support for weight management and metabolic health.
Understanding what the women in your workforce need
A fragmented approach to women’s health doesn’t adequately address the various concerns women have across life stages. That’s why our holistic strategy considers the barriers, unmet needs and opportunities in supporting women’s health and well-being.
On our journey to improve every woman’s access to health care, Aetna is committed to helping companies champion these efforts in the workplace. Collaborating to support the unique needs of your staff is how healthier happens together®. For deeper insight, view our Women’s Holistic Health Digital Magazine.
Distress in the office sector continues to worsen, with foreclosures and transactions falling apart, even at large discounts, because buyers cannot secure adequate financing. Office occupancy remains low due to hybrid/remote work models, and tenants will likely continue to reduce their office footprints to reduce operating costs while preferring newer, highly amenitized Class A buildings to attract employees.
It could take years for office values to bounce back and, even then, there is no saving outdated office properties. Savvy owners and investors are walking away from investments in which they cannot salvage their equity at today’s values.
Many owners and borrowers who have been wiped out in their investment property’s capital stack prefer to walk away, unable or unwilling to contribute fresh capital to extend or refinance existing maturing debt. However, borrowers should consider the tax ramifications of giving back the keys and available mitigation strategies.
Tax Considerations
Nonrecourse vs. Recourse Debt
Transferring title of a property to the lender is considered a sale of the property from a tax perspective. The owner is treated as having received sale proceeds equal to the outstanding debt, which could result in a taxable gain equal to the excess of the debt amount over the adjusted tax basis in the building. This is usually taxed at the capital gains rate.
However, if the owner surrenders a property securing recourse debt, the transfer is treated as two separate tax transactions, and both phantom gain and cancellation of debt (COD) income could be realized: phantom gain to the extent that the property’s fair market value (FMV) exceeds the owner’s adjusted tax basis, and COD income to the extent that the principal amount of the debt exceeds the property’s FMV.
Mitigating Phantom Gain and COD Income
Phantom Gains
There are limited ways to defer phantom gain, such as via a like-kind exchange into a new property or timing the surrender of the property during a year in which the owner has other losses to offset the phantom gain. Since a like-kind exchange is a cashless transaction; the debtor may need to find sufficient capital to buy the replacement property, and will need to structure the ownership with new investors and satisfy other requirements such as hiring a “qualified intermediary.”
COD Income
Owners can negotiate with lenders to achieve debt reduction via loan modifications or discounted payoffs, but both have tax consequences; the borrower must recognize COD income in an amount equal to the forgiven debt (recourse or nonrecourse), which is taxed at ordinary income tax rates.
If the debt was used to acquire or improve the building and it exceeds the building’s FMV, the owner may defer the COD income equal to that excess amount. However, the owner is then required to reduce the taxable basis in the building (or other properties owned), which results in lower future depreciation deductions and increased taxable gains if the building is sold later.
Insolvent or bankrupt borrowers may exclude COD income to the extent the borrower is insolvent, or the debt is discharged in bankruptcy. However, certain tax “attributes” (e.g., operating losses and the adjusted tax basis of the asset) must be reduced. For pass-through entities (i.e., partnerships), the respective partners (not the partnership itself) must be insolvent or receive the discharge in bankruptcy to use the exception to recognizing COD income, while non-insolvent partners must recognize their share of the COD income.
Additional Options for Borrowers
Lenders may be willing to work with borrowers in seeking other mutually beneficial solutions, including:
Using an A/B note structure whereby the A note pays current interest and the B note accrues interest at a higher rate for a future payoff;
- Providing additional collateral or limited guarantees that improve the lender’s position in exchange for modified terms for the borrower;
- Raising additional equity, preferred equity or mezzanine debt to pay off the existing loan and refinance under prevailing underwriting terms.
A better understanding of the tax implications of surrendering a property often motivates borrowers to contribute capital and restructure their debt rather than give back the keys. Developing and presenting a plan to your lender can avoid negative tax consequences and allow for continued ownership while waiting for real estate and interest markets to improve.
Ingrid Rivera Noone is a senior managing director and co-leader of the Real Estate Solutions practice at FTI Consulting, Inc. Contact her at ingrid.noone@fticonsulting.com. Scott Drago is a managing director in the Business Tax Advisory group within the Real Estate Solutions practice at FTI Consulting, Inc. Contact him at scott.drago@fticonsulting.com.
Here are the subway disruptions, road closures and other commuting changes you should be aware of as you get around the city this week.
Subways * In Queens, no 7 trains at Flushing-Main Street between Tuesday, Oct. 1 and Friday, Oct. 4 from 12:15 a.m. to 5 a.m. The 7 line runs between 34th Street-Hudson Yards and Mets-Willets Point, the last stop. * No N trains at Coney Island-Stillwell Avenue in Brooklyn on Tuesday, Oct. 1 between 9:45 a.m. to 3 p.m. for signal maintenance. * Service on the 5 line between East 180th Street in the Bronx and Bowling Green, Manhattan ends early on Friday, Oct. 4 at 8:15 p.m.
Commuter rail
Westbound Long Island Rail Road trains will skip the Elmont-UBS Arena, Queens Village and Hollis stations between Monday, Sept. 30 and Friday, Oct. 4 from 10 a.m. to 3 p.m. due to track maintenance. MTA buses will accept LIRR tickets for travel from Queens Village and Hollis to Jamaica. Elmont-UBS Arena riders should use the Bellerose station instead.
Roads and bridgesNo major planned disruptions.
Read recent transportation stories:
Four of New York City’s five public employee pensions are investing $9.5 million in an infrastructure fund co-founded by former comptroller William C. Thompson Jr.
Retirement funds for police officers, teachers, non-teaching school employees, and civil servants, are investing in American Triple I, a minority-owned private equity firm, as part of the pensions’ $20 billion emerging and diverse manager program. ATI, founded by Clinton administration veteran Henry Cisneros, manages about $400 million in assets, according to a filing with the U.S. Securities and Exchange Commission.
The city’s pension fund for firefighters didn’t invest in ATI.
Thompson, a Brooklyn Democrat, served as New York City comptroller from 2002 through 2009. As comptroller, Thompson was the city’s chief fiscal watchdog and investment adviser to the city pension funds.
He ran for mayor in 2009, losing to Michael Bloomberg, who was elected to a third, four-year term. The former mayor is the founder and majority owner of Bloomberg News parent Bloomberg LP. In 2013, Thompson ran against Bill de Blasio in the Democratic primary for mayor, but withdrew from the race.
Thompson is currently the chair of the City University of New York’s Board of Trustees and is the chief administrative officer for Siebert Williams Shank & Co, a minority- and woman-owned investment bank. Cisneros, who led the U.S. Department of Housing and Urban Development under President Bill Clinton, is vice chairman of Siebert.
Thompson’s long career in politics and government didn’t influence the city pensions’ investment in ATI, said Shaquana Chaneyfield, a spokeswoman for current city Comptroller Brad Lander. BlackRock Inc. which manages a separate account of emerging and diverse infrastructure mangers for the city’s pensions, had full discretion to make the investment, she said.
“There was no advantage based on Bill Thompson’s prior role as comptroller,” Chaneyfield said in an email. “This is an investment risk-return based decision.”
Public pensions have boosted their investments in airports, ports, toll roads, and renewable energy, as a way to achieve steady returns that can help protect against inflation. New York City’s $277 billion pension funds had $7.6 billion in infrastructure asset as of July 2024, according to the comptroller’s website.
American Triple I is part of consortium, including Vantage Airport Group, JetBlue Airways Corp and RXR Realty, building a new $4.2 billion terminal at John F. Kennedy International Airport for the airline. The new Terminal 6 is expected to begin operating in 2025 with construction complete in 2028.
In addition to JetBlue, Aer Lingus and Cathay Pacific have said they will operate from Terminal 6.
In recent years, a narrowing of corruption law that began at the U.S. Supreme Court has filtered down to New York politics, helping multiple local politicians — including a lieutenant governor and a powerful Assembly Speaker — beat their charges, at least temporarily. But some observers say the case against Mayor Eric Adams could be different, and more perilous for the mayor.
Federal courts have chipped away at bribery laws involving U.S. citizens, most notably in a 2016 case involving ex-Virginia Gov. Bob McDonnell. The Supreme Court held that McDonnell could not be charged for accepting gifts and free travel from a businessman who wanted to influence state government, ruling that prosecutors did not prove that McDonnell favored the man through “official acts.”
That precedent helped prompt judges to overturn the bribery convictions of ex-New York Assembly Speaker Sheldon Silver in 2017, ex-State Senate Majority Leader Dean Skelos that same year, and former Andrew Cuomo aide Joe Percoco in 2023. Judges also tossed the corruption charges against ex-Lt. Gov. Brian Benjamin in 2022. (Silver and Skelos were later convicted again, and Benjamin's charges have been reinstated by a higher court.)
But bribery makes up only part of the five-count indictment against Adams, which also alleges that he solicited illegal donations from foreign nationals and committed fraud by using the donations to receive public matching funds. Those laws have not been narrowed by any recent Supreme Court rulings, meaning Adams’ attorneys could struggle to challenge the charges, said Daniel C. Richman, a Columbia Law School professor and former Manhattan federal prosecutor.
“Maybe there’ll be some interesting argument that elections are special, but lies to obtain money are at the core of what the statute is about,” Richman said. “And the Supreme Court has consistently held that.”
John Kaehny, executive director of the pro-transparency watchdog group Reinvent Albany, said the 57-page indictment appears to “very deliberately” work around the McDonnell precedent.
“You can see that these prosecutors have a copy of that decision on their desk next to them while they're writing this indictment,” Kaehny said.
As for the bribery charge that could be touched by the recent court rulings, the Manhattan prosecutors — led by U.S. Attorney Damian Williams — do allege the kind of explicit quid pro quo that the Supreme Court has said must be proven. The indictment says that Adams, after receiving discounted flights and hotel stays from a Turkish official, repaid the official by pressuring the fire department to grant safety approvals for the new Turkish Consulate in Midtown while serving as Brooklyn borough president and after he had won the Democratic primary in his 2021 run for mayor.
“There does seem to be an official act,” Richman said.
What’s more, the Supreme Court explicitly said in the McDonnell case that pressuring another official to do something — as prosecutors allege Adams did with the fire commissioner — still counts as an official act.
As for proving whether Adams exerted the pressure because of the gifts he received, Richman said prosecutors will rely on an all-important exchange from September 2021 in which the Turkish Consul General told an Adams aide that it was “his turn” to help Turkey by speeding up the safety approvals. Adams responded, according to the indictment, “I know.”
“What that language does is connect the receipt of money before and after to the pressuring of someone to do an official act,” Richman said.
More technically, Richman noted that the specific bribery law that Adams is charged with breaking is different from the law that the courts have recently narrowed. The law in the Adams case says only that government officials cannot take gifts from people trying to influence “any business, transaction, or series of transactions” — a broad ban that makes no mention of official acts.
Adams has pleaded not guilty, and prosecutors still need to muster enough supporting evidence to win a conviction. If Adams is convicted, there is also no guarantee how the Supreme Court might rule on an appeal.
Adams’ attorney Alex Spiro defended the free flights as a routine perk offered to “VIPs,” and said the indictment fails to show Adams himself soliciting any money.
“They don’t have Eric Adams doing anything,” Spiro said at a press conference on Thursday. “There’s no corruption. This is not a real case.”
But Williams, the U.S. Attorney for the Southern District of New York who is prosecuting Adams, has already made clear that he is mindful of the Supreme Court precedent. At a Crain’s event last April before the Adams investigation was known, the prosecutor said he ensures that “everything we do is done in a way that's going to pass muster, not only with the rules as they exist today but also with the rules that may exist down the road.”
“The view, I think, of a person on the street of what is a corrupt politician and the view of an appellate court, for instance, may be very different,” Williams said. “So we have to make sure that everything we’re doing is aligned with the more narrow view.”
The troubled real estate powerhouse RFR may soon lose control of the Chrysler Building, a jewel of the New York skyline.
Cooper Union, which owns the land under the landmarked tower, said RFR hasn’t paid rent for its ground lease since May. The school said it plans to terminate the lease today and take custody of the building.
“Control of the Chrysler Building will transfer to Cooper Union,” said John Ruth, vice president for finance at Cooper Union, in a statement provided to Crain’s. “We are engaging a world-class property management firm, Cushman & Wakefield, to ensure a smooth transition for our tenants.”
RFR filed a lawsuit Thursday in an effort to prevent Cooper Union from terminating its lease, suggesting Cooper Union’s takeover may not be a done deal.
“RFR remains committed to Chrysler Building for the long term,” the firm said. The lawsuit “is a procedural step in the successful resolution to the groundlease between RFR and Cooper Union over the coming weeks.”
In a subsequent statment, the firm said: “While RFR prefers to resolve this matter amicably, and privately, if possible, it is also prepared for the alternative, if necessary.”
Losing the Chrysler Building would contribute to what’s already been a terrible, horrible, no-good, very-bad year for RFR chief Aby Rosen. His Austrian partner in the Chrysler Building is insolvent, and tenants complain of broken elevators, mice and dirty drinking water.
Elsewhere in the city, lenders and city agencies have sued RFR for missed loan and tax payments at 17 State St., 522 Fifth Ave. and 90 Fifth Ave. The jewel in Rosen’s crown, the Seagram Building, carries nearly $1 billion mortgage in mezzanine debt that must be refinanced next year. RFR controls nearly 3 million square feet of commercial space.
“He’s going to lose stuff. He’s definitely going to lose stuff,” one longtime broker told reporters C. J. Hughes and Eddie Small in July. “I wouldn’t bet against this guy, but I wouldn’t want to be him right now because he’s got a lot of buildings that are underwater.”
Yesterday Rosen’s firm sued Cooper Union, alleging the nonprofit didn’t negotiate in good faith and was “clearly oblivious to the new financial realities.” The school-landlord “unreasonably insisted upon draconian terms” such as demanding “millions of additional dollars” before considering lease modifications.
On Friday, a lawyer for Cooper Union, Steven Klein, sent a letter to RFR obtained by Crain’s explaining why it would terminate the lease.
“Your withholding of $21 million is not acceptable to us,” the letter reads. “You have repeatedly misrepresented your situation and have been unable to raise the capital necessary…despite your assurances that you had things under control.”
Jay Brown, who co-founded the entertainment powerhouse Roc Nation alongside billionaire hip-hop entrepreneur Jay-Z, has picked up a pad in SoHo.
The home, a full-floor condo unit at 50 Wooster St., traded for $10.3 million, according to a deed that appeared in the city register this week. Laurence Jay Brown, which is Brown’s birth name, signed the deed on behalf of the listed purchaser, The RMP Trust.
Tucked in a prewar complex on a cobblestone block between Broome and Grand streets, the 4,600-square-foot spread features four bedrooms, three baths and direct elevator access, as well as many of the kinds of details associated with the neighborhood’s historic lofts, such as hardwood floors, beamed ceilings and exposed-brick walls. There’s also a small terrace off the open-floor-plan-style living and dining room combo.
According to StreetEasy, the sellers, Leslie and Timothy Hartzell, first listed the home in June 2022 for $12.5 million and marketed it on and off for the past two years, a time of sluggish sales owing to high interest rates for home loans. The Federal Reserve’s rate cut this month, however, is expected to improve conditions.
At $10.3 million, the SoHo unit, which went into contract July 15 and closed Sept. 19, according to the deed, traded for 18% less than what the Hartzells sought.
In December 2022, a couple of months after the team of SL Green Realty Corp. and Caesars Entertainment unveiled a plan to build a casino at 1515 Broadway in Times Square, Roc Nation joined the partnership. A casino would supposedly lead to $166 million in new spending in the neighborhood, the team has said.
But the group is competing for the gaming license needed for such a casino with several other powerful and well-financed groups, including one led by the developer The Related Cos., which is seeking to build one in Hudson Yards. A state panel is expected to decide on the license late next year.
This month Roc Nation pledged $15 million for after-school and other community programs in Times Square-adjacent Hell’s Kitchen if its bid is approved.
In 2008 Brown, Tyran Smith and Jay-Z, whose real name is Shawn Carter, co-founded Roc Nation with a $50 million investment from the concert giant Live Nation. Today, in addition to being a home for musicians such as Rihanna, Alicia Keys and Megan Thee Stallion, the company also has a robust talent agency that represents basketball, baseball and even broadcast news stars. The privately held firm, for which Brown serves as CEO, also has a VC arm, Marcy Venture Partners.
In 2019 Roc Nation opened a 60,000-square-foot office, its New York headquarters, on West 26th Street in Chelsea. It also has offices in London and Los Angeles.
Mallory Bogard, the Serhant agent who marketed the home, had no comment by press time, and Jana Fleishman, a Roc Nation spokeswoman, did not return an email.
Leases
Sunset Park’s Whale Building lands another lease
Address: 14 53rd St., Brooklyn
Landlord: Capstone Equities
Tenant: Bravo Stone and Tile
Lease size: 3,180 square feet
Asset type: Office
Brokers: Newmark's Bernard Weitzman, Jordan Gosin, Ryan Gessin, Christopher Ventura and Rohan Kapoor represented the landlord.
Sales
Viand Coffee Shop outpost changes hands on Upper East Side
Address: 673 Madison Ave., Manhattan
Seller: Duell family
Buyer: Friedland Properties
Sale price: $36 million
Asset type: Mixed use
Investor picks up rentals in Brighton Beach and Prospect Park South
Addresses: 200 Brighton 15th St. and 165 E. 19th St., Brooklyn
Seller: Sentinel Real Estate
Buyer: Rockledge
Sale price: $23.4 million
Asset type: Multifamily
Financings
Crown Heights’ Tivoli Towers secures funding
Address: 49 Crown St., Brooklyn
Owner: Stellar Management
Lender: The New York City Housing Development Corp.
Loan amount: $12.8 million
Asset type: Multifamily
Sven tower in Long Island City recapitalizes
Address: 29-59 Northern Blvd, Queens
Owner: The Durst Organization
Lender: Affinius Capital
Loan amount: $105 million
Asset type: Multifamily
Public Advocate Jumaane Williams is a self-described democratic socialist whose office is likely best known for publishing a list of the 100 worst landlords in the city each year. Although Williams, through his policies, has done little to endear himself to the real estate community during his career, not everyone in the industry is concerned about what will happen if he becomes the acting mayor if Mayor Eric Adams resigns or is removed.
"I think the most important thing over the next year is just stability and lack of chaos," said Eli Weiss, principal at the New York developer Joy Construction. "I'd be less concerned about long-term overall real estate policy than I would be about the city continuing to function. The garbage still has to be picked up."
New Yorkers of all stripes have been rapidly trying to familiarize themselves with the mayoral line of succession in light of Thursday's stunning indictment of Adams on charges including bribery and wire fraud. Although Adams has so far insisted he will stay on as mayor, he is facing immense pressure to resign, and if that happens, Williams would at least temporarily fill the role until a special election for the remainder of Adams' term.
Williams, whose office did not respond to a request for comment, has been a frequent advocate for higher taxes on the wealthy and significantly stricter rent protections, among other progressive policies. But the actual impact his ideology would have on his stint as mayor, if it comes to that — along with how much of an opportunity he would even have to implement policy — is still up for debate.
City of Yes
The fate of the package of housing reforms in Adams' City of Yes initiative remains one of the biggest open-ended questions for his administration and for a potential Williams one. There were already worries about whether the mayor's legal issues would sink the proposal before his Thursday indictment, and now its path through the City Council is even murkier.
The City Planning Commission voted 10-3 in favor of the plan earlier this week, moving the final hurdle to the 51-member legislative body, which will vote on the initiative by the end of the year. Williams could thus take over as mayor with its passage still uncertain and would then need to determine what role, if any, to play in the remaining negotiations.
But one City Council member who spoke with Crain's on the condition of anonymity to be more candid is not concerned about getting City of Yes over the finish line no matter who is in office. Department of City Planning Director Dan Garodnick is the architect of the ambitious housing initiative, and he has been more than competent, the council member noted.
"The mayor hasn't himself been deeply involved," he said. "And most importantly, it's at the end of the process, so it's hard to pull it now."
Another prominent city developer, who also spoke on the condition of anonymity, said that if Adams does resign, City of Yes would be Williams' most significant and likely only real initiative on the housing front, given that his temporary term would last for only about 80 days, according to the rules of the city charter. Once he's sworn in as interim mayor, he would have to set the date for a special election within three days.
"He has some friends in the real estate community and has been in and around city government for a long time," the developer said of Williams. "I don't see it as Armageddon."
Other areas
Williams could also have a chance to make an impact on real estate through his appointments. The number of officials leaving the Adams administration has been a major point of concern, and Adolfo Carrión, Housing Preservation and Development commissioner, is rumored to be eyeing the exit as well, although a City Hall spokesman denied this. Appointing a new HPD commissioner in particular could give Williams a chance to leave a mark on the city's housing policies.
Cea Weaver, a leader at the tenants' rights group Housing Justice for All, listed three additional things Williams could do easily and quickly even if he stays in the mayor's seat for only a few months: Implement the low-income housing voucher expansion law that Adams is feuding with the City Council over, fully lift a hiring freeze on city agencies to get more workers into HPD specifically and replace seven of the nine members on the Rent Guidelines Board whose terms have expired.
"I'm really confident in Jumaane," she said. "If he became mayor, he would do a great job."
One former councilman, who also requested anonymity, said a Williams administration could also decide to let "the dogs of war loose on some of the worst landlords." HPD just announced Thursday that notorious landlord Daniel Ohebshalom, a frequent name on the public advocate's worst landlords list, was headed back to Rikers Island over his failure to fix violations at two of his buildings, a drastic move that could be more common under Williams, the former councilman said.
A matter of time
Much of the impact Williams would have on real estate or any industry depends on how long he ends up serving as mayor. He aggressively denied rumors he would run for the office in 2021 and has shown little interest in it since then. But actually having the authority could make him decide he wants to keep it, the former councilman said. He did not see this as a good outcome for New York's real estate world.
"It's going to send a message to the business community that New York has fallen into hands that are to the left of Bill de Blasio," he said. "Yeah, he's going to make gestures toward development, but not mixed-income development, not market-rate development, so you can't count on him."
But others downplayed these fears. The current councilman who spoke with Crain's said other elected officials would probably encourage Williams to ensure the city runs smoothly amid such turmoil rather than make aggressive moves at any agency, at least until the special election.
"There will likely be a push for the public advocate to act as a careful steward for the office until the voters pick a new mayor," he said.
Mayor Eric Adams pleaded not guilty to federal charges that he accepted lavish travel perks and illegal campaign contributions from foreign nationals.
Adams entered the plea Friday in federal court in Manhattan a day after an indictment was unsealed that detailed a pattern of alleged conduct that sparked calls for his resignation from his political rivals. The first-term Democrat has vowed to continue to serve as mayor of the nation’s largest city.
“I am not guilty, your honor,” Adams told Judge Katharine H. Parker at the hearing.
Prosecutors allege that dating back to when Adams served as Brooklyn borough president, he accepted improper benefits including luxury travel from wealthy foreign businesspeople and at least one Turkish government official seeking to gain influence over him. He’s also accused of secretly accepting illegal contributions to his 2021 campaign.
Adams, a former police officer, arrived at the courthouse early Friday morning to surrender to authorities and have his fingerprints taken. Adams sat stoically as Parker read the charges for several minutes.
What is Gov. Kathy Hochul going to do?
That is the overriding question in New York right now as Eric Adams becomes the first sitting mayor in the city’s history to be indicted. A growing number of politicians have called for his resignation and he has, like Donald Trump, vowed to fight on, potentially taking his case to trial.
Federal investigators may not be done with him. There are at least three other active probes. More indictments are possible and more resignations of those close to Adams might come. Parts of city government are effectively paralyzed.
Hochul is in a bind. As governor, she has the power to remove Adams from office. On Thursday night, she released a statement indicating, obliquely at least, she was willing to exercise this nuclear option.
But she didn’t come out and fully declare she would do this because she would much rather have Adams resign. Dragging a mayor from office — even one as beleaguered and unpopular as Adams — is an extraordinary maneuver. Adams won an election in 2021, and Hochul would be forcing a change without any input from the electorate.
For her, there are also optics to consider. Hochul will seek re-election in two years, and if she faces a primary challenger, she’ll need support from working- and middle-class Black voters in New York City. Adams still retains some support in these neighborhoods; when he addressed the press on the morning after his indictment, he stood with Black clergy and civil rights leaders.
There is, too, the natural affinity between Hochul and Adams. They are both moderate Democrats who have been willing to battle the progressive wing of their party. They both speak the language of law-and-order, and they are unabashed supporters of Israel.
If Hochul does nothing, pressure will build on her to act. This is why she wants Adams to quit soon. She does not want reporters asking her every day if she’s going to remove an indicted mayor from office.
Only Hochul can make Adams resign. She must hope the threat of removal is enough to convince Adams to save face and move on. It is the greatest game of chicken, perhaps, that’s ever been played in New York politics.
Adams, who maintains his innocence, is incentivized to hang on. If he is convicted, his only bargaining chip with the feds will be his office. When legislators are indicted, they rarely resign immediately. They know prosecutors will trade a resignation for a guilty plea to a lesser charge.
Adams, presumably, does not want to spend a decade or more behind bars. He is 64 years old. Defendants who fight the federal government in court and lose — the feds have an extremely high success rate on cases brought to trial — go to prison for a very long time. Unlike Trump, Adams cannot indefinitely delay a trial or claim some kind of immunity from prosecution.
His leverage is severely limited. One way or another, his political career is almost over. It’s merely a question of whether he resigns, Hochul removes him, or he limps onward to the 2025 Democratic primary and loses.
If Hochul does move against Adams before March 2025, Jumaane Williams, the public advocate, becomes acting mayor and a nonpartisan special election is held roughly 90 days after the resignation. Like the primary, it would be conducted under the rules of ranked-choice voting.
Andrew Cuomo, the disgraced former governor, is expected to run, and he’d be an early frontrunner. Williams would likely run, and Brad Lander, the city comptroller, and Scott Stringer, his predecessor, are already candidates. State Senators Jessica Ramos and Zellnor Myrie have thrown their hats into the ring.
There may even be more candidates. Regardless of what Hochul does, many politicians in New York will be seeking a promotion in the next few months.
Ross Barkan is a journalist and author in New York City.
Although city Health Commissioner Ashwin Vasan plans to vacate his post come January, some officials say his departure will not affect the Health Department’s priorities to improve mental health care and increase life expectancy.
The city’s top doctor announced he would step down just days before Mayor Eric Adams’ indictment on federal bribery charges sent the local political world into free fall. While questions swirl around who will fill Vasan’s shoes, some public health officials insist the commissioner’s signature programs concerning mental health and substance use will remain on pace.
Adams tapped Vasan to lead the public health agency and its more than $2 billion budget with the goal of tackling the city’s long-standing gaps in services for New Yorkers with untreated mental illness.
The city laid out its six-year public health roadmap, HealthyNYC, and multiple mental health agendas during Vasan’s tenure. Those programs, which outline steps New York will take to increase life expectancy and connect more people to services, will continue unabated, said Health Department spokesman Patrick Gallahue.
“It’s a pretty long list of work that’s being implemented,” he said. “We have a plan, we have a blueprint, and it’s going.”
Gallahue touted the department’s hospital-based overdose prevention program, the transition to the 988 crisis response line, resources for youth and parents, and naloxone distribution, all of which have been expanded or implemented under Vasan.
Perhaps Vasan’s signature intervention was growing the use of mental health clubhouses, which combine clinical services into a social club atmosphere.
Vasan used to lead one of the biggest, Hell’s Kitchen-based Fountain House, as president and CEO before he joined the Adams administration in 2022. Since he’s been in office, the city’s spending on clubhouses has grown to $30 million a year. Awards under those contracts are already being made. Fountain House will receive $106 million over the next 10 years under a new spending formula that standardized requirements and pushed out some smaller providers.
“We’re confident that because of Dr. Vasan’s hard work putting into place critical public and mental health initiatives in New York City, that work will continue for a long time to come,” said City Hall spokesman William Fowler.
He would not say whether the administration is seeking another commissioner with a mental health background.
HEAT INJURIES: NYU Langone on Thursday launched a research collaborative to study how health systems and governments should prepare for the risks of extreme heat. Project Heatwave aims to bring together climate modeling, public health analysis and medical technology to reduce heat-related mortality. Participating institutions include NYU Abu Dhabi, Emirates Aviation University, the City University of New York, the United Nations Intergovernmental Panel on Climate Change and chief heat officers from North Dhaka in Bangladesh and Miami-Dade County in Florida.
UNION VOTE: Staffers who work in diagnostic labs at Northwell Health’s New Hyde Park facility have voted to join 1199SEIU United Healthcare Workers East, the union announced Thursday. More than 850 lab technicians, phlebotomists, customer service representatives and others filed for a union election in July, and 80% have now voted in favor of joining, according to 1199SEIU. The lab workers are the second group of such employees at Northwell to become a part of the union; staff at one of the system’s lab facilities in Little Neck voted to join 1199SEIU in December.
ICYMI: Gov. Kathy Hochul has allocated $90 million over the next five years to support youth with complex mental illnesses. The governor’s office said Tuesday that it would fund six organizations in a mental health stability program designed to help youth avoid extended stays in emergency rooms or psychiatric facilities. The organizations that received the funding are located in the Hudson Valley and upstate areas.
Mayor Eric Adams has said he has no plans to resign after his indictment by federal prosecutors on five counts this week. But if that changes or Adams is removed from office, Public Advocate Jumaane Williams is first in the mayoral succession line. If Williams assumes the role, the city’s health care system can expect more of the progressive health efforts he has championed thus far.
If Williams becomes mayor, the city may see a greater focus on investments in community mental health programs, alternatives to police interventions and public health initiatives in low-income communities during his tenure, which would last until at least January 2026.
Williams, outspoken about seeking therapy for his own mental health challenges, has emphasized the importance of mitigating the city’s mental health crisis. The public advocate has supported funding mobile crisis teams, which canvass city streets to get New Yorkers into treatment, and respite centers, which offer short-term residences as an alternative to hospitalization for people in crisis.
One of the public advocate’s main policy platforms is reducing police intervention in mental health emergencies. That includes expanding the B-Heard program, a pilot program that sends EMTs and social workers to mental health-related 911 calls instead of police. Adams pledged last year to execute a citywide expansion of the program, which operates in only 31 of the city’s 77 police precincts. But that expansion came to halt earlier this year due to funding constraints – a pause that Williams has called out.
“If we want an effective alternative to police responses to people in mental health crises, we must be meaningfully prioritizing resources for that response,” Williams said during a City Council oversight hearing on the B-Heard program earlier this week. He said the city should be directly funding the public health system to staff social workers, mental health professionals and peer-support staff to the crisis response teams.
Adams, too, has made the city’s mental health crisis a cornerstone of his agenda, albeit via the opposite approach – one that has relied heavily on policing. The mayor unveiled a controversial plan in November 2022, directing police officers, emergency medical responders and outreach workers to involuntarily transport people to hospitals if they showed signs of severe mental illness.
Williams criticized the plan, telling the news station NY1 that it had a “lack of clarity” – except where the mayor pledged to increase involuntary removals. He said the plan did not provide information on funding for mobile crisis teams, drop-in crisis centers and other facilities “that will actually provide the care that’s needed.”
Williams has also promoted efforts to safeguard reproductive health and birth equity. The public advocate, a nonvoting member of the City Council, signed on to a package of city bills in 2022 to address stark racial disparities in maternal morbidity and mortality. He sponsored a resolution that created a maternal bill of rights in an aim to reduce discrimination toward pregnant people, calling birth equity an “under-acknowledged and under-addressed” public health crisis.
The public advocate also sponsored legislation passed by the council earlier this year to increase city-run testing sites for sexually transmitted infections in low-income neighborhoods, where rates of illnesses including chlamydia and gonorrhea have historically been roughly double that of high-income areas. He sponsored the bill alongside Councilwoman Pierina Sanchez, who represents parts of the Bronx.
Adams, meanwhile, is facing growing calls for him to step down, and it’s not clear whether Gov. Kathy Hochul will remove him from office. If either of those scenarios play out, Williams will be sworn into the job and required to call a special election within three days of becoming mayor under the City Charter. The election is required to take place before the end of this year.
Mayor Eric Adams will appear in Federal District Court in Manhattan Friday at noon to be arraigned after he was indicted on five criminal counts accusing him of bribery, wire fraud, conspiracy and soliciting contributions from a foreign national.
His public statements thus far imply he will enter a plea of not guilty. An initial conference date was set for Friday, Oct. 4. The mayor will appear before Magistrate Judge Katharine Parker tomorrow, though Judge Dale Ho will oversee the case.
Adams is facing five criminal charges in connection with what federal prosecutors call a years-long corruption scheme in which he secured favors for Turkish leaders in exchange for more than $100,000 in luxury travel and $10 million in funding for his mayoral campaigns — all while covering up evidence of what he and his aides knew to be misconduct.
He now finds his mayoralty in peril amid growing calls to resign.
A San Francisco-based office landlord with properties in New York and across the U.S., Canada and Europe has added one more Manhattan building to its portfolio for $52 million, records show.
Spear Street Capital, which was founded in 2001 and has since amassed more than $11 billion in investments, has acquired 446 Broadway in SoHo, according to a deed that appeared in the city register Wednesday.
The firm currently maintains two other Manhattan properties, 641 Sixth Ave. and 2 Crosby St., and it previously bought and sold 315 Park Ave. South, according to its website.
Known as the L'Atelier, the 5-story commercial building between Howard and Grand streets was sold by the investment firm KPG Funds, headquartered just down the block at 433 Broadway. KPG bought the circa-1915 building for $46 million in 2018, according to city records, and redeveloped it into boutique offices. The property was named "Best Office Development" by Commercial Property Executive's CPE Influence Awards in 2022.
The roughly 40,000-square-foot building is currently occupied by household goods store Rumi Life on the ground floor with offices above it, including one that's home to Santa Monica-based video editing service Cabin Editing Co. It made its New York debut in 2021, when it signed a 10-year lease for 7,000 square feet of space on the top floor of the Broadway building.
The average asking rent in the neighborhood for ground-floor retail is $281 per square foot, according to a report from commercial real estate firm JLL from the first quarter of this year; asking rents for SoHo office space, meanwhile, can range from $42 to $128 per square foot, according to LoopNet.
Greg Kraut, KPG's co-founder and chief executive office, who signed the sale documents, did not respond to a request for comment.
John Grassi, the chief executive officer of Spear Street Capital, signed the deed on behalf of the buyer. The global office landlord has more than 19 million square feet of holdings across the country as well as in Ireland and British Columbia. Spear Street did not immediately respond to a request for comment about its plans for the site.
David Malawer, the senior managing director of Midtown-based firm Newmark Knight Frank, is the broker for the building's office tenants; and Richard Skulnik, executive vice president of commercial real estate firm Ripco, also based in Midtown, is the broker for the building's retail tenants. Neither Malawer nor Skulnik responded to a request for comment.
New York Community Bancorp’s recovery from a tumultuous year is far from over, but months of work spent trying to transform the lender may finally be paying off.
The Hicksville, New York-based bank’s shares gained as much as 9% on Thursday after Barclays upgraded its rating on the firm to overweight from equal-weight and boosted its price target to $14. The new target matches the highest amount analysts tracked by Bloomberg and implies upside of about 31% from where the stock currently trades.
“NYCB has completed the heavy lifting around credit evaluation, capital growth and balance sheet repositioning,” Barclays analyst Jared Shaw wrote in a note to clients. “While the path ahead is still challenging, risk/reward appears in its favor as the bank positions for the future.”
Most of Shaw’s peers have moved to the sidelines as the commercial real estate lender worked to right-way its business this year. Out of the 16 analysts tracked by Bloomberg, 13 have a hold rating and the remaining three, including Barclays, have a buy-equivalent recommendation on the stock.
Shaw noted that the lender has established a “solid footing” as its added multiple new leaders this year and raised capital through a common and convertible preferred offering.
In March, the troubled lender appointed Joseph Otting, the former comptroller of the currency, as its new chief executive. Otting replaced Alessandro DiNello, who became CEO less than a week earlier. The shares have been largely range-bound since then, still trading about 65% lower for the year. The stock plunged in January after the company flagged real estate risks that spooked investors.
However, fundamentals have been gradually improving for the lender. In the last quarter, NYCB wrote off more for bad loans in the first quarter than estimated, with net charge-offs totaling $81 million, but they came in lower than the fourth-quarter total as well.
“NYCB is well on its way to completing the targeted restructure and recapitalization of the balance sheet, but there are still challenges ahead,” Shaw said as he upgraded the stock for the first time since taking coverage in March.
The New York City Council will introduce legislation this week that would drastically reduce the amount of insurance coverage taxi and ride-share vehicles are required to maintain, looking to contain potential fallout from the insolvency of the city’s largest taxi insurer.
City Council Member Carmen De La Rosa, who represents Washington Heights, Inwood and Marble Hill, wants to lower the minimum personal injury protection coverage for commercial ride-share cars in New York City from $200,000 to $50,000. The change would bring insurance requirements in line with levels mandated for ride-share vehicles in the rest of the state, helping lower premiums in an industry beset by financial problems.
“I represent a community in Northern Manhattan where the livery industry is still one of the economic engines for my community,” said De La Rosa, who will introduce the bill on Thursday.
She’s urging the council to act just weeks after the state’s Department of Financial Services warned that American Transit Insurance Co. has “massively deficient” reserves and “is at significant risk of failure.” The company, which insures at least 60% of the city’s roughly 120,000 taxis, livery cabs and ride-share vehicles, disclosed in its latest filings that its losses outstrip reserves by roughly $700 million.
A spokesperson for American Transit did not respond to a request for comment.
Insurance industry experts have blamed American Transit’s financial circumstances partly on its practice of charging artificially low premiums that aren’t commensurate with its liabilities. If the company failed, the outcome would be “economically devastating for livery drivers, passengers, health care providers and the New York economy, and would disrupt vital transportation services,” DFS has said.
The agency, which regulates all insurers statewide, is working with American Transit on a plan to shore up its finances, which could include a sale or liquidation.
Exorbitant premiums
De La Rosa said her legislation, which would require a majority of the Council and the mayor’s approval to be enacted, is designed to help city black car and cab drivers, who’ve struggled since rideshare apps upended the economics of the industry. Many drivers are saddled with debt after buying once-valuable Medallions, the relatively scarce city-issued licenses to operate cabs, before their value crumbled.
If another company were to take over American Transit and charge premiums high enough to cover their liabilities, city taxi drivers could see their premiums, which range from $4,000 to $6,000 a year, increase by as much as 30%. That would be devastating to city drivers, De La Rosa said. Even at current levels, taxi drivers’ premiums are “so exorbitant at this point that many drivers are afraid they’re going to lose their livelihoods,” she added.
Personal injury protection, or PIP, also described as “no-fault insurance,” covers medical costs and lost wages for drivers or their passengers if they’re injured in a car accident, regardless of which party was at fault. New York is one of just 12 states in the country that requires drivers to carry such personal injury protection coverage, and the city has one of the highest coverage level requirements in the country.
New York City’s $200,000 personal injury protection coverage requirement was implemented in 1998, after a series of high-profile crashes led to devastating pedestrian and passenger injuries.
In the 1990s, the rate of accidents involving for-hire vehicles had been steadily increasing, said Matt Daus, a former chair of the city’s Taxi and Limousine Commission, who is now chair of the Transportation Practice Group at law firm Windels Marx.
“When these laws were passed there were no systems in place to get bad drivers off the road,” Daus said. But riding in taxis has become much less risky since then, he said.
New York City’s high PIP coverage requirements have had a negative unintended consequence, becoming a magnet for would-be fraudsters, city and state regulators have said. In no-fault insurance fraud schemes, groups of people manufacture accidents, or fabricate or exaggerate injuries sustained in crashes to exploit the possibility of a six figure payout.
A 2023 DFS report found 75% of all fraud claims the department received that year were suspected cases of “no-fault” insurance fraud.
De La Rosa said the high coverage requirements had also discouraged other insurers from trying to compete in the market — making American Transit too big to fail, as one of the only companies operating in the industry.
Two recent reports attempt to put a number on the value of nonprofit hospitals' tax breaks.
As nonprofit health systems and hospitals grow, a smaller number of organizations account for a larger share of total tax exemptions, including income, sales andproperty tax. The dynamic has reinvigorated a debate on nonprofit hospitals’ tax-exempt status among industry groups and policymakers, along with other stakeholders.
The American Hospital Association, which represents nonprofit hospitals, commissioned a report published Tuesday that found nonprofit hospitals’ community benefit spending far outweighed the value of their federal tax exemptions in 2020.
Hospitals reported an estimated $129 billion in community benefits in 2020, compared with an estimated $13.2 billion in forgone federal revenue from tax exemptions, according to the analysis performed by accounting firm EY.
EY analyzed the Medicare hospital cost reports for 2,432 private, nonprofit non-specialty hospitals, comparing federal corporate income tax exemptions, tax-exempt bond financing and federal unemployment tax exemptions with nonprofit hospitals’ financial assistance offered to patients, community-building activities, the difference between reimbursement and the cost of care for Medicare beneficiaries and patients’ unpaid medical bills.
“Nonprofit hospitals have a special obligation to those they serve and this new analysis from EY shows these efforts are more than a worthy investment and that improving the health of their communities remains at the heart of the mission of the hospital field,” AHA President and CEO Rick Pollack said in a blog post accompanying the report.
A study published Thursday in the Journal of the American Medical Association, meanwhile, estimated nonprofit hospitals received $37.4 billion in tax benefits in 2021. About $13.8 billion of the benefits came from federal income tax, bond financing and federal unemployment tax exemptions. Roughly 7% of hospitals analyzed accounted for half of the total annual tax benefit, researchers from Texas Christian University and Johns Hopkins University found.
Researchers looked at the financial data of 2,927 nonfederal, short-term and specialty hospitals — specifically their federal and state income tax, sales tax, property tax and federal unemployment tax exemptions, tax-exempt bond financing and the fair market value of charitable donations.
The study authors did not calculate nonprofit hospitals’ community benefit spending, but they supported laws that would improve hospitals’ accountability to taxpayers.
"State and local governments should require nonprofit hospitals to disclose the value of their property tax and sales tax benefits," said Ge Bai, co-author of the study and accounting and health policy professor at Johns Hopkins.
Hospital supporters, including industry groups, have argued nonprofit institutions do a practically immeasurable amount of good for communities in the form of employment, free or discounted care known as charity care for low-income patients, necessary services, education and research, among many other benefits. Some policymakers and patient advocates counter hospitals should be offering more charity care for their communities and relaxing debt collection policies.
Last year, Oregon state legislators implemented a law requiring providers to make financial aid resources more accessible to patients and make any potential charity care deductions before sending patients a bill. Sen. Bernie Sanders (I-Vt.) in October issued a report finding 12 of the 16 largest health systems dedicated less than 2% of their total revenue to free or discounted care.
This article originally appeared in Modern Healthcare.
New York City Mayor Eric Adams reiterated Thursday morning he has no plans to resign despite being indicted on five criminal counts accusing him of bribery, wire fraud, conspiracy and soliciting contributions from a foreign national.
The pressure on him to quit is mounting, however, and officials across the city are telling the mayor to step aside.
Perhaps the most important potential resignation call to watch for is one from Gov. Kathy Hochul, who has the power to remove Adams from office per the New York City Charter. Taking steps to do so would make her the first New York governor in nearly a century to exercise that power.
The governor told reporters at an event in Syracuse around noon, "Later today I’ll be addressing the substance that is found within this indictment. This is a very serious matter that is unfolding."
If Adams leaves office, Public Advocate Jumaane Williams, a progressive politician, would become acting mayor until a special election could be held.
Among the notable figures calling for Adams' resignation are:
Rep. Alexandria Ocasio-CortezComptroller Brad LanderRunning against AdamsAntonio ReynosoBrooklyn Borough PresidentNYC Council Member Shaun AbreuEndorsed Adams in 2021Mondaire JonesFormer congressman and current candidate for NY-17NYC Council Member Robert HoldenNYC Council Member Chris BanksState Senator John LiuNYC Council Progressive Caucus 18 membersOthers calling for the mayor to resign include watchdog group Reinvent Albany, the New York Working Families Party and an array of council members. Four of the five candidates who've announced intentions to challenge Adams for his seat called for his resignation — all except Rep. Jessica Ramos.
Notably, Hakeem Jeffries, the Brooklyn congressman and House minority leader, stopped short of calling on Adams to step down.
Others are actively supporting the mayor — or at least pleading for patience. State Senator James Sanders Jr., a Democrat representing Queens, for example, called on folks to "avoid rushing to judgment."
Added Kathryn Wylde, president and CEO of the Partnership for New York City: "We must allow the legal process to take its course, including a full assessment of a substantive response from the mayor to the charges against him."
Hochul is expected to address the indictment later today.
This is a developing story and will be updated.
Uncertainty in the city’s business community swirled Thursday in the wake of Mayor Eric Adams’ federal indictment: there is no clear favored pick among the contenders so far vying to replace him in next June’s primary.
Four prominent Democrats have entered the race, all of whom are considered politically to the left of the mayor and whose visions for the city would represent a departure from Adams’ tenure as a moderate Democrat with a pro-business agenda.
“I don’t think the business community will rally around anybody at this point,” said Kathryn Wylde, the president and chief executive of the Partnership for New York City, in an interview Thursday morning.
The four candidates currently vying to replace the mayor are the city’s Comptroller Brad Lander; Scott Stringer, a former comptroller; Zellnor Myrie, a Brooklyn state senator; and Jessica Ramos, a state senator representing Queens. One formidable undeclared candidate is likely former Gov. Andrew Cuomo, who has been working to make a return to politics since his resignation in 2021 over a sexual harassment scandal he continues to deny.
“This is a sad moment, but city government will continue to function and we cannot let the allegations against the mayor derail the important policies and programs that his Administration has underway,” said Wylde. She added that the city’s business leaders are looking for “continuity” in the mayor’s pro-business agenda.
Many in the business and real estate community were still digesting the news on Thursday morning but some who spoke with Crain’s mentioned former Gov. Cuomo and former Sanitation Commissioner Kathryn Garcia as possible candidates. Cuomo largely kept the support of the real estate community throughout his time as governor before his resignation in 2021. Garcia, now Director of State Operations, came close to winning the mayoralty in 2021 and was similarly seen as a moderate candidate. Another name one government veteran floated to Crain’s is Deputy Mayor Maria Torres-Springer, the former commissioner of the city’s Department of Small Business Services.
“I think everybody's been thrown for a loop and they're just trying to recalibrate right now,” Paul Zuber, the executive vice president of the Business Council of New York State, said in an interview Thursday afternoon.
“Since the indictment there's been so many rumors as to who is potentially jumping into the race that, I think, from the business community standpoint, it's a wait and see sort of thing,” said Zuber.
Of those who have formally thrown their hat in the ring, none of the mayoral hopefuls would be considered the candidate of the business community, said political strategist William Cunningham, who advised former Mayor Michael Bloomberg. Cunningham added that Stringer and Lander might be candidates the city’s corporate leaders could see working with, given that they’ve both held the job of city comptroller, the city’s chief fiscal watchdog.
Adams on Thursday morning said he has no plans to resign and pointed to his support in the business community as one reason why. “You say who is the point person who is going to deal with the business community, who’s going to deal with the business of running the city? The point person is Eric Adams,” the mayor told reporters.
If the mayor steps down, Public Advocate Jumanne Williams, a progressive, would become mayor temporarily and set the stage for a special election likely to be held later this year.
A special election would be nonpartisan, which Cunningham said creates an opportunity for a “nonconventional candidate” with name recognition to make an effective bid for mayor. Cuomo could also be a strong candidate in a special election, he said.
“He's had his ups and downs in his career, but he has some money in the bank and he has name recognition,” said Cunningham. “And if there is a special election a lot of voters would look for who can grab hold of government and manage it very quickly.”
That rings especially true for the city’s corporate leaders, said public relations specialist George Arzt, who served as press secretary to the late Mayor Ed Koch.
"I think the business community would look favorably at Andrew [Cuomo] because they thought that he ran a good administration; he has a lot of baggage but they liked his policies," said Arzt.
In recent weeks, candidates and would-be candidates have sought to cast themselves as an alternative to the mayor. On Sunday, Cuomo spoke at the Bedford Central Presbyterian Church in Brooklyn where he described the city as out of control. “Things are getting worse not better, and I think we need to take a fresh look with a new perspective,” Cuomo said during his visit.
Last week Lander met with city business leaders at an Association for a Better New York breakfast in Manhattan, where he portrayed himself as a component fiscal manager. “This is not a time for ideology or political lanes, this is about actually delivering the better run city that New Yorkers are so hungry for,” Lander said during the event.
Two attendees told Crain’s after the event that they had been impressed by Lander, who, despite his progressive credentials, had been introduced warmly by ABNY chair Steven Rubenstein as a “serious person.”
“That process is just beginning and people are obviously listening,” one business leader who attended Lander’s speech said after the event, days before news of Adams’ indictment. “Their listening is contextualized by the fact that the current administration is taking on water.”
Nick Garber, Julianne Cuba and Eddie Small contributed reporting.
Notorious city landlord Daniel Ohebshalom was back behind bars Wednesday night after failing to fix dangerous living conditions at two of his long-dilapidated apartment buildings in Washington Heights, the city announced.
The housing division of Manhattan Supreme Court approved the second arrest warrant for Ohebshalom — who has frequently been named on the public advocate's annual list of worst landlords — and sent him back to Rikers Island for another 60 days, the city's Housing Preservation and Development Commissioner Adolfo Carrión said Thursday.
This is not Ohebshalom's first stint at Rikers. The landlord, who in the past has used pseudonyms to avoid accountability, first turned himself in to authorities in March after Housing Court Judge Jack Stoller signed off on his arrest earlier that month over accusations that he failed to address nearly 700 violations across a pair of uptown properties.
Alleged problems at 705 and 709 W. 170th St., which have been at the core of an ongoing HPD lawsuit from 2021, include infestations of rats and cockroaches, mold and lead paint in common areas and apartments that are not only unsightly but hazardous to tenants' health. He was sentenced to 60 days at the notorious jail.
Ohebshalom again turned himself in Wednesday night after missing deadlines for court-ordered repairs at the two West 170th Street properties, Gothamist reported. He will be held at Rikers for up to 60 days. His projected release date is Nov. 23, unless he corrects the violations earlier, according to Department of Corrections records.
He also faces separate but related criminal charges from Manhattan District Attorney Alvin Bragg for allegedly harassing rent-stabilized tenants across five of his apartment buildings — 331 E. 14th St., 410 and 412 W. 46th St., along with both of the West 170th Street properties — the top prosecutor revealed in an indictment in May.
"As alleged, Daniel Ohebshalom took advantage of rent-regulated tenants living in five Manhattan apartment buildings by creating dangerous living conditions in an effort to push them out. New Yorkers deserve to live in their apartments without fearing for their safety," Bragg said at the time. "Landlords have the responsibility to ensure tenants' safety."
It remains rare for landlords to go to jail, but is not unheard of. In 2017, real estate owner Steve Croman was sentenced to a year at Rikers after pleading guilty to charges of grand larceny, tax fraud and falsifying records.
Back in July, I wrote a column noting that major players in the city's real estate industry were continuing to contribute to Mayor Eric Adams' reelection campaign despite his ongoing legal troubles. It ended with the observation that "nothing short of an indictment (something that is not currently on the table)" seemed likely to put a major strain on their relationship.
And, well, here we are.
Adams became the first mayor in the city's history to be indicted Thursday morning and now faces charges of bribery, solicitation and wire fraud. It will take months to determine the full implications, but the main options for real estate at the moment seem to be to stick with Adams, look for a new candidate or sit out the 2025 race. None are particularly appealing.
Adams has struck a defiant tone about the indictment so far. He has called the investigation "lies," hinted that it is politically motivated and has given no indication that he will resign despite growing calls for him to do so.
The real estate industry could follow suit and remain steadfast in its support of him, but they would be backing a severely weakened version of the mayor. The City Council has already overridden several of his vetoes on high-profile bills, and there are signs that his legal struggles could doom his administration's signature City of Yes housing reforms. He may not have the political capital to act on industry priorities at this point regardless of whether they stand by him.
The industry could also try to coalesce quickly around a new candidate, but that comes with plenty of its own risks. First of all, that candidate does not exist yet. Adams has already drawn a robust field of 2025 challengers, but they have so far all been largely to his left on real estate issues, making them unlikely allies for the industry.
More business-friendly candidates could enter the race shortly given the game-changing nature of the indictment, but there is no guarantee any of them would be able to command the broad support of the industry like Adams has — especially if Adams himself stays in the race, which seems to be his plan.
That brings us to resignation, both the action and the feeling. It seems very unlikely that any big names in real estate have enough influence over Adams to convince him to resign, and even if they did, it is tough to see them joining the increasing chorus of calls for him to do so just yet. Adams' replacement would be Public Advocate Jumaane Williams, an extremely progressive politician whose office is arguably the industry's least favorite thanks to its annual "worst landlords" list. Williams would only be a temporary replacement until a nonpartisan election decides who will serve out the rest of Adams' term, but the industry would surely prefer to keep Williams out of the office altogether as long as that's an option.
Of course, real estate has dealt with a former public advocate becoming mayor before. His name was Bill de Blasio. Yes, he was never very popular among the development crowd, especially compared to the sainted Michael Bloomberg, and yes, he got in a strange feud with the Durst family that ended up involving the developer quoting Game of Thrones. But, somehow, the real estate industry made it through his two terms and continues to be a major and influential sector of the city. If leaders decide their best option is to resign themselves to another more liberal executive after Adams, they will certainly not be happy about it. But they will survive.
Leases
Accounting and consulting firm expands in Vornado building
Address: Penn 1, Manhattan
Landlord: Vornado Realty Trust
Tenant: Weaver and Tidwell
Lease size: 36,500 square feet
Asset type: Office
Brokers: Josh Glick, Jared Silverman and Anthony Cugini represented the landlord in-house. Newmark’s Neil Goldmacher and Michael Horn represented the tenant.
Sales
Office landlord picks up 5-story cast-iron SoHo site
Address: 446 Broadway, Manhattan
Seller: KPG Funds
Buyer: Spear Street Capital
Sale price: $52 million
Asset type: Mixed use
Landlord flips Gravesend shopping complex after three years
Address: 2004 McDonald Ave., Brooklyn
Seller: Isaac Wolfe
Buyers: Joseph Shrem and Morris Lincer
Sale price: $11.6 million
Asset type: Retail
NYPD Chief of Transit Michael Kemper, who has presided over a contentious increase of police officers stationed in the city’s subway system over the last year, will retire at the end of the month and is expected to join the MTA in a top security role.
The Metropolitan Transportation Authority declined to comment on the potential move, but two sources familiar with the situation said Kemper will join the transit agency after he leaves NYPD. An NYPD pension fund document says his last day is Sept. 27. The NYPD did not return requests for comment.
Kemper, who has served in the NYPD for more than three decades, was appointed chief of transit in December 2022 by then-commissioner Keechant Sewell, and has served in the role for less than two years. He earned roughly $240,000 in the role last year, city records show.
His tenure came amid a time of heightened city spending on crime in the subway. After a January uptick of mostly grand larcenies (property theft without force), Kemper oversaw the Adams administration doubling down on overtime spending in the subway this year. That includes by assigning 1,000 additional police officers to shifts in the subway starting in February. The beefed up law enforcement came on top of the existing 2,500 officers in the NYPD's $250 million transit bureau.
NYPD spending on overtime for patrols in the subway went from just $4 million in 2022 to $155 million in 2023. Some transportation and good government advocates have questioned how cost effective spending on policing the system is — especially when it’s not uncommon to see officers mulling in stations staring at their phones.
For the month of July 2024, the NYPD reported that overall crime in the subway dropped 19.7% compared to July 2023, and that subway crime is down roughly 5% year-over-year.
Kemper’s relatively short tenure still outlasted his predecessor, Jason Wilcox, who filed for retirement in December 2022 less than a year into taking over the position, reportedly owing to a leadership shakeup at the NYPD.
Stocks saw their worst day since the Aug. 5 market meltdown, when underwhelming manufacturing data preceded the all-important jobs report — igniting a growth scare that shook markets around the world.
Just like early last month, big tech got hit the hardest, with Nvidia driving a plunge in chipmakers. And the parallels don’t stop there. Oil plummeted amid concerns about tepid global demand. Wall Street’s “fear gauge” — the VIX — soared. Treasury yields tumbled, with traders keeping their bets on an unusually large half-point Federal Reserve rate cut before the year is over. And the yen, which came under intense volatility last month, is up almost 1% on Tuesday.
With inflation expectations fairly anchored, attention has shifted to the health of the world’s largest economy as signs of weakness could speed up policy easing.
While rate cuts tend to bode well for equities, that’s not necessarily the case when the Fed is rushing to prevent a bigger slowdown. The trepidation regarding the latest rise in the unemployment rate will leave traders “on edge” until Friday’s payrolls data is in hand, said Ian Lyngen and Vail Hartman at BMO Capital Markets.
“This week’s jobs report, while not the sole determinant, will likely be a key factor in the Fed’s decision between a 25 or 50 basis-point cut,” said Jason Pride and Michael Reynolds at Glenmede. “Even modest signals in this week’s jobs report could be a key decision point as to whether the Fed takes a more cautious or aggressive approach.”
To Callie Cox at Ritholtz Wealth Management, aside from the macro picture, there’s also the fact that we’re entering what’s often a “miserable time” of the year for equities.
“While history isn’t gospel, it’s not crazy to think that this September could be especially volatile,” Cox noted. “But this isn’t the conclusion to draw from decades of seasonal market data. Instead, your attention should be on why this is a “buyable dip, because there are a lot of reasons to be optimistic here.”
Among those, she cited: earnings growth, the Fed about to start easing policy against the backdrop of controlled inflation and the fact that investors are sitting on a massive pile of cash “that could make its way back into stocks.”
The S&P 500 dropped 2%. The Nasdaq 100 slid 2.9%. The Dow Jones Industrial Average fell 1.4%. The Russell 2000 of small firms lost 3%. Nvidia slumped 9%. Boeing Co. sank 8% on an analyst downgrade.
Treasury 10-year yields fell fsix basis points to 3.85%. A record number of blue-chip firms are swarming the corporate-bond market, taking advantage of cheaper borrowing costs ahead of the presidential election. The yen climbed as Bank of Japan Governor Kazuo Ueda reiterated the central bank will continue to raise rates if the economy and prices perform as expected.
The Morgan Stanley strategist who foresaw last month’s market correction says firms that have lagged the rally in stocks could get a boost if Friday’s jobs data provide evidence of a resilient economy. A stronger-than-expected payrolls number would likely give investors “greater confidence that growth risks have subsided,” Michael Wilson wrote.
The equity-market rally may stall near record highs even if the Fed starts a highly anticipated rate-cutting cycle, JPMorgan Chase strategists said earlier this week. The team led by Mislav Matejka noted that any policy easing would be in response to slowing growth, making it a “reactive” reduction.”
“We are not out of the woods yet,” Matejka wrote in a note, reiterating his preference for defensive sectors against the backdrop of a pullback in bond yields. “Sentiment and positioning indicators look far from attractive, political and geopolitical uncertainty is elevated, and seasonals are more challenging again in September.”
September has been the biggest percentage loser for the S&P 500 since 1950, according to the Stock Trader’s Almanac. A contrarian sentiment gauge from Bank of America rose to its highest level in nearly two and a half years last month — creeping closer to a “sell” signal for stocks.
“For all years since World War II, August and September saw the S&P 500 endure a double-dose of declines,” said Sam Stovall at CFRA. “Yet history now advises investors to fasten their safety belts, since during election years, this sequential seasonal slippage has shifted to September and October.”
Rich Ross at Evercore says the S&P 500 has had at least a 5% drawdown from the August/September highs in nine of the last 10 years.
“This year should be no different after the late August squeeze into resistance at an all-time high,” Ross noted. The S&P has a strong downside bias buttressed only by a bent towards ‘low volatility’ defensives and financials — which benefit from lower rates and steeper curves.”
“A key lesson from the last few weeks is that big-tech stocks have not proven defensive during the recent market pullbacks,” said Philip Straehl at Morningstar Wealth. “While there is little evidence of a slowdown in AI spending, valuations have set a high bar for incoming corporate and macro data.”
Traders are projecting the Fed will cut its rate by a full percentage point by the end of the year, implying an unusually large half-point reduction at one of the three meetings left in 2024.
What’s more, they are anticipating that the central bank will reduce its benchmark rate by more than two full percentage points over the next 12 months, which would be the steepest drop outside of an economic downturn since the 1980s.
“The Fed is finally coming around to cutting rates, but it does not feel like stringing out a bunch of 25 basis-point rate cuts will do the job,” said Neil Dutta at Renaissance Macro Research. “That muddling through scenario will probably risk further increases in the unemployment rate. So, if they aren’t going 50 in September, they are going to need to go 50 at some point later this year.”
Marking the start of a busy week for economic data, a report showed manufacturing activity shrank in August for a fifth month.
This coming Friday, the August jobs report is expected to show payrolls in the world’s largest economy increased by about 165,000, based on the median estimate in a Bloomberg survey of economists.
While above the modest 114,000 gain in July, average payrolls growth over the most recent three months would ease to a little more than 150,000 — the smallest since the start of 2021. The jobless rate probably edged down in August, to 4.2% from 4.3%.
Interest-rate strategists predict a bigger market reaction if Friday’s August employment data is weaker than anticipated, according to the limited quantity of weekly research reports published around the holiday weekend.
“With the Fed likely to begin its rate cutting cycle in September, investors should consider extending duration now in high-quality fixed income to capture potential gains,” according to Principal Asset Management. “Historically, bond yields drop ahead of Fed rate cuts, offering a window of opportunity to enhance returns without waiting for official policy shifts. Positioning in longer-duration assets now can provide income stability and potential price appreciation in a slowing economy.
No cause better embodies NIMBY mania than the Elizabeth Street Garden.
For years, the city has been trying to turn the small Manhattan park into desperately needed housing. The current plan is an affordable housing complex with 123 apartments for older New Yorkers. About 50 apartments will go to the elderly who are homeless.
The common complaint about housing development in New York City is that far too much of it is geared toward the luxury market. This is not that. The most vulnerable New Yorkers will be welcomed on the city-owned lot, which the City Council approved for housing in 2019.
Credit to Mayor Eric Adams for sticking with the plan and battling back the many activists, local politicians and even celebrities like Robert De Niro, Martin Scorsese and Patti Smith, who have sought to block the housing project. To make way for housing, the city has moved to evict the nonprofit group that operated the green space.
The nonprofit went to court to fight eviction and won in State Supreme Court in Manhattan but lost the next round when the city took the case to the Appellate Division. When the group appealed to the state’s top court, it lost again, and it appears out of legal options.
The city has spent more than a decade trying to build apartments on the lot. Allan Reiver, a gallery owner who lived across the street, had struck a deal with the city to clean up the lot and use the outdoor space as a showroom for his antiques business. He set up the nonprofit to oversee the garden after the city attempted to take back its land. Reiver died in 2021.
If the affordable housing complex is ever built, plans still call for 14,000 square feet of open space. Groups including Habitat for Humanity will decide how to use the space. A vegetable garden and public art are among the possibilities.
The Elizabeth Street Garden does have a unique cultural heritage and remains popular with locals. But it’s simply not vital enough to stand in the way of such a worthy and much-needed housing development. Manhattan, quite frankly, has richer cultural traditions, and there’s green space to be had on the East and Hudson Rivers, as well as Sara D. Roosevelt Park, just a short walk away.
It’s true that this affordable housing complex will not come close to solving the city’s housing crisis. It’s also true that every bit counts — when the doors finally open, more than a hundred lives will be, permanently, changed for the better, and at least 50 human beings will not suffer the horrors of homelessness.
The city is not proposing pouring granite into Central Park or knocking down MoMA for high-rise housing. This is, ultimately, minimal disruption for a far greater good. The amount of opposition the housing project has generated is a testament to the clout of the affluent and outright wealthy locals who congregate downtown and are used to, in almost every instance, getting their way.
What NIMBYs get right is that increasing housing supply, by itself, isn’t going to bring down housing costs quickly enough to help vulnerable tenants in the near-term. A renter facing eviction in October isn’t going to cheer on a luxury tower getting built three blocks away. If Elizabeth Street Garden were being lost to market-rate development, the opposition would some justification for their self-righteousness. They could claim greedy developers were stealing away their little park.
Instead, it’s their little park giving way to permanent housing for the elderly and destitute. The NIMBYs should go away and let the city do its job.
Ross Barkan is a journalist and author in New York City.
Two large tenants are poised to soon leave the 48-story 101 Park Ave., posing a big challenge for the building’s developer and longtime owner, Peter Kalikow.
The vacancy rate at the 1.3 million square-foot tower a block south of Grand Central Terminal will nearly triple after Tiger Management leaves this month and Morgan Stanley departs in December, bond-rating firm KBRA said in a report Friday. The two tenants account for nearly a quarter of the building’s base rental revenue. It isn’t clear whether the firms are consolidating space or moving elsewhere; neither immediately responded to requests to comment.
KBRA described 101 Park as one of the highest-quality office buildings south of 42nd Street. Its large boardrooms, sculptures, granite floors and dark-wood flourishes match the style and spirit of prestigious towers lining Park Avenue a few blocks north. Developed by Kalikow, who chaired the Metropolitan Transportation Authority from 2001 to 2007, 101 Park has historically charged below-market rents in exchange for long-term leases. Some tenants have been there since the doors opened in 1982, including law firms Morgan Lewis & Bockius and Curtis Mallet-Prevost Colt & Mosle.
But long-term relationships between landlords and tenants are harder to maintain when there’s so much office space available. Manhattan’s office availability rate was 17.4% in August, Colliers says, a bit less than the prior year’s 17.8%. Several global law firms have relocated from or near Park Avenue to Hudson Yards’s new buildings, and in 2019 a big tenant at 101 Park since the beginning, law firm Kelley Drye & Warren, moved to 3 World Trade Center.
Tiger is vacating 53,000 square feet at 101 Park for which it paid $115 per square foot, and Morgan Stanley is to move out of 49,000 at $83 a square foot. Tiger was a major hedge fund until it was shut down in 2000 by founder Julian Robertson, who invested in several funds started by former employees, known as “tiger cubs,” many of whom continued to work at 101 Park for many years. Tiger Global Management, the most successful of the successors, relocated to 9 W. 57th St. in 2013. The Tiger Foundation remains headquartered at 101 Park. An official at the nonprofit didn’t return a request for comment.
Kalikow, whose firm was launched by his grandfather in 1927, has seen this movie before. In the aftermath of the 2008 financial crisis, occupancy at 101 Park fell to 82% after battered global banks UBS, Royal Bank of Scotland, and ABN Amro all left. But by 2018 occupancy had risen to 90% after Moran Lewis agreed to take more space through 2029 and the building lured the American Kennel Club, which opened the AKC Museum of the Dog on East 40th Street that still greets visitors eagerly.
The tower is currently 5% vacant but that figure stands to rise to 14% after Tiger and Morgan Stanley leave, KBRA said. New tenants have leased 200,000 square feet since 2022, including wealth manager Corient and Customers Bank.
Tenants are drawn to the building’s excellent location and its angular design that creates more corner offices than a rectangular tower. 101 Park is constructed diagonally and has a large triangle-shaped plaza. The building is also one of the less-indebted along Park Avenue, carrying just a $365 million mortgage that matures in four years and no other debt. Although KBRA reckons the building has lost 20% of its value since the pandemic, debt remains well below the bond-rating firm’s estimated value of $537 million.
A large swath of land in Downtown Brooklyn just steps from the bustling City Point complex is poised for redevelopment, city records indicate.
Real estate firm The Jay Group, based in Bedford-Stuyvesant, has acquired several properties off of the busy Flatbush Avenue Extension for $62.5 million, according to deeds that appeared in the city register last week. The properties include 102 Fleet Place, 275 Flatbush Ave. Extension and 165 Willoughby St.
The Jay Group bought the sites from Dumbo-based property management company Pearl Realty. The transaction also included $12.5 million worth of air rights to be transferred from nearby 147 Pearl St., bringing the total to $75 million, according to the real estate news site PincusCo.
The Jay Group has already filed plans with the Department of Buildings to demolish the 1-story structure currently occupying the roughly 10,000-square-foot site at 275 Flatbush Ave. Extension. It contains a car wash and oil change facility, while the adjacent site at 102 Fleet Place Is a parking lot.
No new building permits have been filed at this time, records show, but the development site sits within the city's Special Downtown Brooklyn District, which supports and promotes large mixed-use projects through certain zoning regulations and tax incentives to create affordable housing in a dense area that's heavily served by mass transit.
The Jay Group acquired the properties with the help of a nearly $50 million loan from Manhattan-based G4 Capital Partners, according to city records.
The parcels sit across the street from the Brodsky Organization's massive City Point development, which is home to the popular DeKalb Market Hall along with a Trader Joe's, Target, and numerous other retail shops. It contains 458 luxury condos in the 68-story mixed-use tower Brooklyn Point as well.
Attorney Alan Weiss of the Bensonhurst-based law firm Gutman Weiss, who represented the seller in the transaction, declined to comment. Attempts to reach both the Jay Group and Pearl Realty were unsuccessful by press time.
A trendy Carhartt boutique seems headed to a stylish stretch of Williamsburg.
Carhartt Work in Progress, a spin-off brand of the retailer known for its heavy canvas clothes, appears to have purchased 132 Bedford Ave., a recently refurbished red brick space between North Ninth and North 10th streets in the hip neighborhood.
ED Real US LLC, a shell company whose SoHo address is the same as that used by Carhartt WIP, paid $10.5 million in a cash deal for the 2-story, 5,200-square-foot retail berth in August, according to a deed that appeared in the city register Tuesday.
The seller in the deal, which the deed says went into contract Jul. 6, was L3 Capital, a 15-year-old Chicago-based private equity firm that invests in retail real estate and controls several Williamsburg sites.
Domenic Lanni, an L3 principal, signed the deed on behalf of the firm, which took control of the Bedford site from developer RedSky Capital three years ago. RedSky had to surrender the keys as a part of a sweeping deed-in-lieu-of-foreclosure move, and L3 appears to have completed RedSky’s redevelopment of the industrial address in 2023 before marketing it.
The 132 Bedford acquisition seems of a piece with recent deals where apparel companies have snapped up storefronts, as opposed to leasing them for the long-term, in an apparent effort to control costs.
In a series of blockbuster deals over the winter, Prada picked up two storefronts on Fifth Avenue in Midtown for a total of $835 million, and Gucci-parent Kering plunked down $963 million for a multi-level space across the street around the same time. Chanel is also reportedly in talks to buy a prominent site at East 58th and Fifth that LVMH is also eyeing.
Lined with bars, restaurants and boutiques, Bedford Avenue is one of Williamsburg’s highest-profile shopping streets and commands retail rents of more than $150 per square foot, according to recent market reports.
With 24-foot double-height ceilings in an airy 3,800-square-foot ground-level space (along with a 1,400-square-foot basement), 132 Bedford marks a considerable expansion for Carhartt WIP. The retailer’s only other New York store at 286 Lafayette St. in SoHo encompasses 1,800 square feet in its sidewalk-level berth.
The Lafayette Street location, which opened in 2022 and which Carhartt WIP apparently leases rather than owns, is the third address for the brand in SoHo since it initially opened in 2011 on nearby Crosby Street. It has relocated twice since then.
Spun off from Carhartt in 1994 by Swiss designer Edwin Faeh by way of a licensing deal, Carhartt WIP offers slimmer-fitting and pricier garb than its parent company. Its garments are also often made in collaboration with brands beloved by skateboarders, like the sneaker company Converse.
Privately-held Carhartt, known for its squash-colored, heavily-stitched canvas pants and jackets, dates back to 1889, when it was founded in Detroit.
Efforts to reach Lanni in L3’s New York and Chicago offices were unsuccessful by press time. An email sent to Carhartt WIP’s North American office went unreturned by press time. And Roberto Rhett, a broker with the commercial brokerage GoodSpace NYC, which marketed 132 Bedford, did not return a call.
An ongoing list of licensed New York cannabis dispensaries that are more than 30 days past due on their bills to suppliers had just two names on it as of Aug. 28, despite there being now 171 operational recreational marijuana shops in the Empire State.
Several cannabis company executives said that the list, which is a novel approach to maintaining the financial health of the marijuana supply chain, seems to be a policy success for a market that has struggled to fully launch.
Two companies on the list — Smacked and Royal Leaf NY, which does business as Statis — are both located in New York City, and both were early recipients of Conditional Adult Use Retail Dispensary (CAURD) permits. Smacked opened for business in January 2023 in Manhattan, while Statis opened in July 2023 in the Bronx.
Although the New York Office of Cannabis Management curates the list of delinquent retailers, it’s typically confidential, accessible only to other business licenseholders upstream in the supply chain, such as growers, distributors and other brands. A records request for the list filed in April by Green Market Report seeking a copy of the list was denied by the OCM as of Aug. 28, but an industry source who requested anonymity shared it.
While many in the fledgling New York cannabis trade agree that the majority of operators are still getting their legs under them, several sources said that the relatively low number of retailers named on the list is a sign that the underlying policy is working as intended, as a solid incentive for shops to keep their bills paid and up to date.
“I would say about 90% of the time, we’re getting paid promptly,” said Joann Kudrewicz, the owner of Ravens View Genetics, one of the licensed marijuana farms in upstate New York. “The few folks that have been bad payers, I just disengage from.”
Nicolas Guarino, the owner and founder of processing firm Naturae, said he’s kept an eye on the list since it went live in April and estimated there’ve only been about eight licensed retailers of the 171 that have even had their names formally put on the list at one point or another. The only way to get off the list is by settling outstanding bills.
“It’s not very many. You really have to be egregious,” Guarino said. “Everybody isn’t just putting the hammer down at 30 days. In general, it’s only used when the retailer is not responding … They get posted on there, and everyone is like, ‘This is a bad actor.'”
Read the full story at Green Market Report.
The FBI early Tuesday arrested a former deputy chief of staff for Gov. Kathy Hochul who also served under former Gov. Andrew Cuomo, according to reports.
The former aide, Linda Sun, was charged with acting as an illegal agent of the Chinese government, using her position to further the interests of the People's Republic of China, and obstructing Taiwanese officials' access to the governor's office.
A 65-page indictment unsealed Tuesday in federal court in Brooklyn includes 10 criminal counts, according to the New York Times, which reported charges of visa fraud, money laundering and accepting substantial economic benefits.
Sun, and her husband Chris Hu were arrested at their home in Manhasset, according to the Daily News, which first reported the story.
Sun left Hochul’s office in 2022.
A spokesman for the governor said that her office has been assisting in the investigation. “This individual was hired by the Executive Chamber more than a decade ago,” said the spokesman, Avi Small. “We terminated her employment in March 2023 after discovering evidence of misconduct, immediately reported her actions to law enforcement and have assisted law enforcement throughout this process.”
Sun started out as chief of staff to then-Assemblywoman Grace Meng in 2009, then spent about five years in various positions in state government before being named deputy chief diversity officer under Cuomo in 2018, according to her LinkedIn. She became Hochul’s deputy chief of staff soon after Hochul became governor in 2021, and departed the following year for a role in the state Labor Department.
The FBI searched the couple’s home in late July.
Sun, 40, and Hu, 41, owned their Manhasset home before transferring it to a trust this year, according to the New York Times. The brick home, inside a gated community, last sold for $3.5 million, according to public records.
Hu runs a liquor store in Queens as well as several other businesses, including a medical supply company, the Times reported.
This story will be updated.
August was a fairly strong month for Manhattan's office market, with companies leasing a solid amount of space despite the absence of a blockbuster deal to buoy the still struggling sector.
Firms leased about 2.6 million square feet of space last month, up 3.5% year over year but down almost one-third from July, according to data from Colliers. The steep month-over-month decline was not a huge shock given how strong the July numbers were thanks to Blackstone's extension and expansion of its 345 Park Ave. lease to roughly 1 million square feet that month. The largest lease for August, by contrast, was the auction house Christie's renewing its lease for about 373,000 square feet at Rockefeller Center.
Activity in August was still about even with the month's 10-year average of roughly 2.7 million square feet, according to Colliers. Manhattan's availability rate tightened slightly to 17.4%, and its average asking rent was $74.56 per square foot, up slightly month over month but down slightly year over year. The borough has about 94 million square feet of available office space.
"Instead of a typical quiet August in the Manhattan office market, tenant demand kept on track with the historical average and continued to outpace supply," said Frank Wallach, executive managing director at Colliers.
Firms leased about 1.4 million square feet of space in Midtown last month, less than half of July's leasing volume due to the absence of a Blackstone-sized lease. The Christie's deal was the neighborhood's largest for August, followed by LVMH taking about 108,000 square feet at 590 Madison Ave. Its availability rate ticked up slightly month over month to 15.7%, while its average asking rent dropped slightly to $78.66 per square foot.
If demand for Midtown office space keeps up its current pace for the rest of 2024, the neighborhood will have its strongest year since 2018, according to Colliers. This is due in part to the number of massive deals the neighborhood has seen this year, including Blackstone, Christie's and Bloomberg extending its lease for about 950,000 square feet at 731 Lexington Ave., Wallach said.
In Midtown South, companies leased about 990,000 square feet of space in August, up significantly month over month and year over year. The neighborhood's largest leases included Yeshiva University taking 160,000 square feet at 1293 Broadway in Herald Square and PubMatic renewing and expanding to 61,000 square feet at 498 Seventh Ave. Its availability rate tightened to 18.2%, while its average asking rent was $80.83 per square foot, up month over month but down year over year.
Downtown saw about 210,000 square feet of activity, up 12.2% from July but down 53.9% from August last year. Its largest deals included Jane Street expanding its sublease at 250 Vesey St. to 57,000 square feet and American Transit Insurance Co. subleasing 43,000 square feet at 25 Broadway. Its availability rate ticked down to 20.1%, while its average asking rent was $57.26 per square foot, up month over month but down year over year.
The Metropolitan Transportation Authority is suing the owner of yet another Harlem property, accusing the landlord behind the apartment building, Nice Realty Corp., of being the latest landlord to prevent construction crews from carrying out work to advance the embattled extension of the Second Avenue subway.
The MTA has sought to gain access to 2121 2nd Avenue, a four-story apartment building, to carry out protective work that would safeguard the property and its occupants ahead of construction on nearby utilities for the next leg of the Second Avenue subway, according to a Manhattan Supreme Court lawsuit filed late last week.
But after more than a year of failed attempts, and some seven months since the MTA says Nice Reality Corp. last responded to its missives, the authority has asked a judge to force the firm’s hand by allowing crews to access the building, and prevent potentially pricey delays to the $7.7 billion subway expansion project.
Nice Realty Corp. did not immediately return calls and messages for comment. The firm has not yet responded to the MTA in court papers.
The Harlem property owner is the third in a week to be taken to court by the MTA over the subway expansion project. And the legal squabble is the latest chapter in the MTA’s years-long saga with the city’s real estate industry to secure properties and access to buildings along the footprint of the Q subway line’s planned expansion, which is expected to extend from 96th Street on the Upper East Side up to 125th Street in Harlem.
MTA spokeswoman Kayla Shults said legal action is considered only as a “last resort” when property owners refuse to cooperate. Further delays to accessing the properties could cost the authority thousands of dollars per day, said Shults.
Airbnb is urging New York City officials to scale back a local regulation that outlawed most of its short-term rental listings when it came into effect nearly a year ago, citing impacts on travelers and hosts.
In a blog post on Tuesday, Airbnb said New York City’s Local Law 18 regulation, which requires short-term rental hosts to obtain a license from the city verifying compliance with strict occupancy rules and building codes, has “failed to deliver on the promise to combat the housing crisis.” Rents in New York have continued to rise while travelers are left with fewer accommodation options and priced out by all-time high hotel prices, the company said. It called for the rules to be relaxed to make it easier for homeowners to rent out their places.
“It’s time for New York City to re-evaluate LL18 and consider amendments that would, at a minimum, allow homeowners to once again host guests,” said Vice President of Public Policy Theo Yedinsky in the post. “By rolling back parts of the law, the city can increase the supply of accommodations for consumers, support resident hosts, and revitalize local businesses that depend on tourism dollars.
Airbnb’s policy recommendation is the latest volley in a long battle with New York City over how short-term rentals — those of fewer than 30 days — should be regulated. It echoes the sentiments of local homeowner and business advocacy groups in urging amendments to the law.
Airbnb had previously sued the city in an effort to block the new rules last year, but a judge dismissed the case. Once the regulation came into effect last September, short-term rental platforms like Airbnb were barred from processing transactions for unregistered units.
The number of short-term Airbnb listings has plummeted by 83% to just 3,700 within a year, according to an August report from data analytics firm AirDNA. For Airbnb, this puts millions of dollars of revenue at stake. The company made $85 million in net revenue from New York in 2022, it previously disclosed in court filings.
In January, Airbnb released its own analysis supporting its position that the rules have not made housing more affordable: rents kept climbing and the drop in short-term rentals did not translate to vacant housing units.
Backlog cleared
The city has so far not signaled it would amend the law. After initial backlogs in processing hosts’ applications, the Mayor’s Office of Special Enforcement, responsible for the rule’s implementation, provided data showing it has caught up with 99.7% of the 6,672 applications it’s received over the past year. About 38% of those were granted licenses, roughly the same proportion were denied, and the rest returned to applicants for modifications.
Christian Klossner, executive director of the enforcement office, hailed the regulation for helping “the city reach its goal of enhancing the enforceability of decades-old housing laws that many hosts violated and from which companies profited.”
At a town hall last year before the rule went into effect, Mayor Eric Adams encouraged homeowners who could no longer rent out their one-to-two family homes on Airbnb to write to their council representatives about their proposals to modify the law. He has also promised to meet with the affected homeowners to hear their demands.
Goldman Sachs Group plans to dismiss a few hundred employees in coming weeks as part of the firm’s annual cull of low-performing staff, according to people familiar with the matter.
The fresh round of firings would bring total cuts in 2024 to about 3% to 4% of the bank’s workforce, with most of those reductions made earlier this year, one of the people said, asking not to be named discussing internal moves.
That’s in line with the bank’s typical approach as it seeks to keep a lid on costs and make room to enlist new talent. The annual exercise was briefly suspended in the middle of the Covid pandemic and was near the lower end of its typical 1% to 5% range last year.
Goldman employed 44,300 people at midyear. A company spokesperson said the bank’s annual review of staff is normal and standard and that the company plans to have more employees at the end of 2024 than a year earlier.
The bank’s stock climbed to an all-time high this week, rising more than 32% to surpass $510 by Friday’s close of trading — making it the best performer among the top banks. The Wall Street Journal reported earlier in the day that Goldman is carrying out its annual cull.
Leases
Loeb Enterprises renews Fifth Avenue office
Address: 712 Fifth Ave., Manhattan
Landlord: Paramount Group
Tenant: Loeb Enterprises
Lease size: 18,056 square feet
Asset type: Office
Brokers: CBRE's Anthony Dattoma represented the tenant.
Sales
Developer picks up stalled Long Island College Hospital redevelopment site
Address: 67-105 Pacific St., Brooklyn
Seller: Madison Realty Capital
Buyer: Rockrose
Sale price: $65 million
Asset type: Land
Sunlight Development acquires Sunset Park residential project
Address: 816 58th St., Brooklyn
Seller: Koban Properties
Buyer: Linzhong Zhuo
Sale price: $9.8 million
Asset type: Mixed-use
Financings
Double U Realty lands loan for Greenpoint housing development
Address: 1000 Lorimer St., Brooklyn
Owner: Michael Weitzman
Lender: Citi Real Estate Funding
Loan amount: $12.7 million
Asset type: Multifamily
Initiated in 1993 under Mayor David N. Dinkins, the ambitious Manhattan Waterfront Greenway aimed to encircle the island with a continuous path for bikers and walkers, enhancing the city’s allure and livability. This project, supported by successive administrations, represents more than just urban beautification — it symbolizes New York’s commitment to sustainable, accessible public spaces. However, a significant 12-block gap along the East River has marred this vision.
The gap that was supposed to be closed with the help of the United Nations. Unfortunately, the U.N. appears to have reneged on its promise, leaving the city to bear the burden alone.
As reported recently by Crain’s Nick Garber, the U.N. has apparently withdrawn from a 2011 agreement to fund half of the $150 million needed for the greenway’s completion. This is more than a financial blow — it’s a failure of civic responsibility. As a prominent resident of New York City, the U.N. had an opportunity to contribute to the city’s development and to enhance its stature as a world-class city that values green, open spaces for all its inhabitants and visitors. The decision to step back from this commitment, influenced by the collapse of a planned office tower deal, is a disappointing shift.
Projects like the greenway are vital to making New York City more attractive to both residents and prospective newcomers, including businesses considering where to establish their offices. Projects like the Manhattan Waterfront Greenway play a crucial role in helping to make the city a magnet for global talent and enterprise.
This backtracking by the U.N. sends a discouraging message about the value of long-term commitments and mutual aid between global institutions and their host cities. It’s especially disheartening considering that the completion of this greenway could significantly elevate the quality of life in New York City, offering new recreational avenues and commuting options that align with more sustainable urban living.
Mayor Eric Adams’ administration, despite inheriting this scenario, must now navigate this roadblock with caution and assertiveness. The Economic Development Corporation said it continues to work in collaboration with the U.N., yet New Yorkers need more than diplomatic talk. They need action, and a restored commitment to funding and completing the East Side esplanade.
As the city plans to move forward alone, the EDC is scouting for construction firms to undertake the remaining segments of the pathway. It’s imperative that the city not lose sight of the vision for a fully realized greenway. The larger picture is that a continuous path circling Manhattan represents a promise to city dwellers of a greener, more connected and accessible New York.
Before starting his culinary career, acclaimed chef Marc Murphy wasn't sure if he would be able to find a job that he would actually be good at.
"I'm very dyslexic. I had a hard time staying in school," he said. "I ended up cooking because I knew I didn't have to read or write."
Murphy's life in the food industry has since led him to work at — or start — prestigious restaurants in Paris, Monte Carlo and New York, and he is a frequent presence on the Food Network as well. But he still speaks of his entrance into the culinary world as little more than a happy accident that began as a way to pay back his brother for letting him crash at his New York apartment.
"Since I felt bad I wasn't paying rent, I would cook dinner all the time," he said. "After a while, my brother was like, 'You seem to like to cook. Why don't you go to cooking school?'"
Murphy took his brother up on this advice and went to a three-month cooking program in the city at what is now called the Institute of Culinary Education. He worked with chefs including David Pasternak and Sylvain Portay before going out on his own in 2004, when he opened up his Landmarc restaurant at 179 W. Broadway in Tribeca.
Landmarc was well received upon its opening, and Murphy eventually amassed a fairly large portfolio of eateries throughout Manhattan. These included Ditch Plains in the West Village and on the Upper West Side, Kingside in Midtown and another Landmarc at the Time Warner Center.
In the late 2010s, however, Murphy all but left the New York restaurant scene, closing down many of his eateries over factors such as sky-high rents and issues with his landlords. The timing of these decisions turned out to be relatively fortuitous, as they meant he did not have to navigate trying to run a restaurant during the pandemic, which infamously upended the industry.
"All my friends are calling me: 'What the fuck? You knew about this?'" he said. "I was like, 'No, I got lucky. I really got lucky.'"
Murphy used the pandemic to do a gut renovation of his Tribeca Landmarc restaurant space, which he owns. He reopened the eatery earlier this year as Marc179. It is now open just three consecutive days each month with a $75 prix-fixe menu that changes monthly. The rest of the time, the building operates as a demo kitchen, private event space and film studio.
Murphy enjoys having a toe back in the restaurant industry, and even though he was not managing any establishments during the peak of the pandemic, he has noticed at least one major change in the industry since then: earlier dinner times.
"The funniest thing I find about the dining scene is the amount of tables that come in at 5:30," he said. "People go out much earlier now, and they go to bed earlier, which is really weird for New York."
People who get their insurance through the individual and small group marketplace will see their premiums rise by an average of 12.7% and 8.4%, respectively, next year, the state Department of Financial Services announced Friday ahead of the long weekend.
The rate hikes are less than what insurance companies asked for but signal New York is well out of the post-pandemic days of meager raises for its underwriters.
The new individual rate is 4 percentage points below what insurers requested, saving $87 million for the roughly 260,000 New Yorkers with those plans, according to the department. Some New Yorkers who get their insurance through New York State of Health, the state’s health insurance marketplace, will see lower premiums thanks to federal tax credits, the agency said. Last year, 65% of people enrolled in individual plans through State of Health received credits.
Rates for small group plans, which cover businesses with fewer than 100 employees, are less than half the average 18.6% increase insurers requested. That will save $766 million for the 700,000 employees enrolled in small group plans, according to the agency. Tax credits, like the Small Business Health Care Tax Credit, could lower premiums for eligible small businesses.
The hikes do not apply to the 1.3 million New Yorkers enrolled in the Essential Plan, the state’s coverage option for lower-income residents, who are not charged a premium.
The rate increase for individual rates is roughly the same as last year’s 12.4% hike, and the small group rate bump is marginally higher than the 7.4% increase in 2024. The increases have begun to plateau in recent years after rising from record-lows in the aftermath of the Covid-19 pandemic. In 2021, the individual rate increase was 1.8% and in 2022 it was 3.7%.
Twelve individual plans and 13 small group plans requested to charge their customers more. The highest requested rate increase for individual plans was from Emblem Health, which asked for a 51% hike and was granted 35.6%.
The hikes insurance companies requested were a reflection of high health care costs driven by hospital price increases, prescription drug prices and taxes on insurance, said Eric Linzer, president and CEO of the New York Health Plan Association, which represents 26 insurance companies across the state. Pharmaceutical companies raised prices on 820 brand name drugs in 2024, according to Linzer.
“Unfortunately, the final approved rates fail to fully recognize these factors or account for the premium reductions the State has imposed the last several years,” he said in a statement.
He said several bills recently passed by state lawmakers would also impact health care costs but were not factored into the state’s final decision. Those included restrictions on the amount plans could charge copays or cost sharing, costs which would now be borne by insurance companies if approved by Gov. Kathy Hochul, according to senior vice president Leslie Moran. Another bill would place additional restrictions on insurance companies’ use of step therapy, in which plans require a person tries an often cheaper treatment option before the drug their doctor prescribed.
The Department of Financial Services did not respond to a request for comment about its decisionmaking.
HARM REDUCTION: New York has distributed more than 20 million fentanyl and xylazine test strips statewide, Gov. Kathy Hochul said on Friday. Test strips allow people who use drugs to check their substances for lethal amounts of fentanyl or xylazine, providing them with information about whether their drug supply could lead to an overdose. The state’s Office of Addiction Services and Supports launched an online portal last year where New Yorkers can order test strips or the overdose-reversing medication naloxone kits at no cost. The portal and harm reduction supplies are funded by opioid settlement funds.
MEDICAL EDUCATION: The state Department of Health has invested $432,000 in three medical education programs designed to promote clinician diversity at SUNY Upstate’s Norton College of Medicine. The funding will support scholarship programs for individuals pursuing master’s degrees in public health, future doctors and students getting advanced degrees in medical technology, the Health Department said Friday. The investment is a part of the agency’s nearly $5 million initiative to provide health care scholarships to roughly 1,000 students from marginalized backgrounds statewide.
VETERAN SERVICES: The state’s Department of Veteran Services has launched the first of a fleet of three mobile outreach centers to help veterans, active military members and their families get access to earned benefits. The first mobile outreach van debuted at a state fair in Syracuse last week, offering people access to an advisor to connect them to health care and property tax exemptions, according to the governor’s office. Mobile outreach centers will appear at future events upstate and at the Veteran’s Day parade in New York City, the administration said.
Montefiore Medical Center reversed its longstanding pattern of losses in the second quarter, earning a profit thanks to the help of a state pilot investing billions in the Medicaid program.
After years of deficits, the Bronx hospital brought in $71 million in operating income between April and June of this year, notching a 4.9% operating margin, according to a quarterly earnings statement released Thursday. Montefiore’s profit increase was driven in part by rising revenue from patient services, but was primarily buoyed by federal grant funds and the state’s 1115 Medicaid waiver program.
The 1115 waiver program, which kicked off last month, is a federally-funded pilot program that allows New York to use Medicaid dollars in new ways, including for transportation and housing. The bulk of the $7.5 billion allocated for the program will fund social services for Medicaid enrollees, but the state carved out a little over $2 billion to aid New York City’s struggling safety-net hospitals.
Montefiore is a beneficiary of those funds. The 800-bed medical center received $100 million from the state through the safety-net funding program, which aims to improve population health at hospitals which serve a large portion of Medicaid enrollees.
The new waiver money bolstered Montefiore’s revenues in the second quarter. The medical center brought in $1.5 billion in total revenue, up nearly 20% from the same time last year.
Patient revenue increased by 12% year-over-year to $1.3 billion, financial statements show. But the hospital quadrupled earnings categorized as other revenue, which includes the Medicaid waiver payments. Other revenue exceeded $149 million in the second quarter.
Despite revenue increases, the hospital’s costs still rose by 13% year-over-year, according to financial documents. Montefiore’s total expenses reached $1.4 billion in the second quarter, driven by double-digit increases in salaries, benefits and medical supplies.
The most significant drivers of Montefiore’s operating performance so far this year were the 1115 waiver payments and roughly $50 million in reimbursements from the Federal Emergency Management Agency, according to Jess D’Amelia, an external communications specialist representing Montefiore.
D’Amelia said the hospital is grateful to government agencies for such programs, as Montefiore’s patient population is made up of 80% Medicaid patients.
Montefiore will receive the 1115 waiver payments for each year of the pilot program, which extends through 2027, according to the hospital.
A rally in stocks faded at the end of a wild August on Wall Street, with investors gearing up for what’s historically known as the worst month for equities.
For all the whiplash in global markets a few weeks ago, things are looking reasonably calm. Equities saw mild moves on Friday, with the S&P 500 poised for its fourth consecutive monthly gain amid data showing the economy is holding up, while leaving the door open for the Federal Reserve to start cutting rates in September. Whether a jumbo-sized reduction remains on the table, next week’s jobs report might bring some clues.
“As August comes to a close, sentiment has calmed down significantly compared to the beginning of the month,” said Mark Hackett at Nationwide. “Many of the larger concerns in the overall economy have decreased. September may bring some seasonal challenges, but if investors can navigate through them, these challenges can turn into advantages in the fourth quarter.”
Since 1950, the S&P 500 has generated an average loss 0.7% in September and finished higher only 43% of the time, making it the worst month for stocks on an average return and positivity-rate basis, according to Adam Turnquist LPL Financial. The last four Septembers have also been notably weak, with the index posting respective declines of 4.9%, 9.3%, 4.8%, and 3.9%.
“During the month, the index tends to trade sideways during the first half, with losses beginning to accumulate into month end,” he said. “For this year, the midway point also happens to line up closely with the September Fed meeting.”
The S&P 500 rose to around 5,600. Volume was thin ahead of Monday’s Labor Day holiday. The Nasdaq 100 added 0.6%. The Russell 2000 of small firms was little changed. Wall Street’s “fear gauge” — the VIX — dropped to around 15. That’s after an unprecedented spike that took the index above 65 during the Aug. 5 market selloff.
Treasuries fell, but were poised for their longest monthly winning streak since 2021. The dollar rose at the end of its worst month this year. Oil sank as traders priced in expectations OPEC+ will proceed with previously announced output hikes in the fourth quarter.
Equity bulls were seeking to finish August “with a bang,” but ran into selling pressure near all-time highs ahead of what’s historically been the worst month for equities, said Jose Torres at Interactive Brokers.
Data from Bespoke Investment Group found that over the past 100 years, September also has by far been the worst month of the year for the Dow Jones Industrial Average with an average decline of 1.24%. A Citigroup Inc. analysis of data since 1928 suggests S&P 500’s average realized volatility for September has historically been 1.5 points above August, while October has been an additional 2.5 points higher.
There are a few theories for why September tends to be a weaker month for stocks. For one thing, investors returning from summer vacations tend to reassess portfolio positioning defensively. Companies prepare their budgets for the coming year and debate belt tightening. And mutual funds often engage in “window dressing” by selling positions at a loss to reduce the size of their capital-gains distributions.
“Additionally, companies entering a blackout period for share repurchases at the end of the third quarter can have their ability to support their share price impacted if the price drops,” Hackett said.
For now, many traders are pinning their hopes on more data that will show the economy isn’t falling off a cliff, while inflation keeps marching toward the Fed’s 2% goal.
A report Friday showed consumer sentiment improved for the first time in five months as slower inflation and prospects for Fed cuts helped lift expectations about personal finances. The Fed’s preferred measure of underlying inflation — the core personal consumption expenditures price index — rose at a mild pace.
“This week’s numbers dispel worries about a recession and inflation,” said David Russell at TradeStation. “Goldilocks could be here as Jerome Powell prepares to turn the page.”
Powell said last week the time has come for the central bank to cut its key policy rate, affirming expectations that officials will begin lowering borrowing costs next month and making clear his intention to prevent further jobs cooling.
Like the Fed, investors’ focus seems to be shifting from inflation to the labor market, and soon all eyes will be on next Friday’s monthly jobs report, said Bret Kenwell at eToro.
“Last month’s jobs report was a big miss, causing widespread worry that the Fed was too late to cut rates,” he noted. “Another big miss could increase speculation of a 50 basis-point cut vs. the current expectation of a 25 basis-point cut.”
Stock markets are likely to benefit again from good economic data, which is needed for the rally to broaden out further beyond the tech sector, according to Barclays Plc strategists.
The team led by Emmanuel Cau says the monthly jobs data next week will be the bellwether for confirming or refuting recession worries.
“If it is a bad print, no doubt equities would react badly given their level after the rebound,” they wrote. On the other hand, a better-than-expected figure would “help assuage those recession fears in the short run, and likely be good for equities.”
Swap contracts fully price in a quarter-point move and about 25% odds of the half-point cut forecast by at least two large banks. They continue to almost fully price in a half-point rate cut at some point this year, anticipating cumulative easing of almost 100 basis points over the Fed’s three remaining policy meetings.
“The markets are now awaiting next week’s job market figures, which should determine whether the Fed opens the rate cut ball with a 50 or 25 basis point cut — the difference between an emergency cut and a normalization cut,” said Florian Ielpo at Lombard Odier Investment Managers.
Cash funds recorded inflows of about $24.5 billion in the week through Aug. 28, a fourth straight week of additions, according to a note from Bank of America Corp., citing EPFR Global data. About $20.7 billion entered bond funds, while $13.7 billion flowed into stocks, the data showed.
U.S. equities saw a ninth straight week of additions at $5.8 billion.
This Labor Day New Yorkers can expect especially long airport lines and bumper-to-bumper car traffic. For the rest of the week, here are the subway disruptions, road closures and other commuting changes you should be aware of as you get around the city.
Subways* On Labor Day, all subway lines run on a Sunday schedule. * No 2 trains between 3rd Avenue-149th Street, Bronx and 135th Street, Manhattan from Tuesday, Sept. 3 through Friday, Sept. 6 from 9:30 p.m. to 5 a.m. * Service on the 3 line is suspended from Tuesday, Sept. 3 through Friday, Sept. 6 from 9:30 p.m. to 5 a.m. * 5 train service ends early at 8:15 p.m. between Bowling Green, Manhattan and East 180th Street in the Bronx from Tuesday, Sept. 3 through Friday, Sept. 6. * No A train service between Euclid Avenue in Brooklyn and Ozone Park-Lefferts Boulevard in Queens from Tuesday, Sept. 3 through Friday, Sept. 6 from 9:30 p.m. to 5 a.m.
Commuter rail* On Labor Day, Metro-North Railroad’s Hudson, Harlem, and New Haven Lines run on a Sunday schedule while the Port Jervis and Pascack Valley lines run on a weekend schedule. Long Island Rail Road trains also run on a weekend schedule. * Metro-North Railroad trains on the New Haven line bypass East Norwalk in both directions through Friday, Sept. 6. Consider using the South Norwalk station instead. Norwalk Transit District will run a shuttle bus between the two stations during weekday rush hours. * As of Tuesday, Sept. 3 on the Long Island Rail Road there are major changes to midday, late evening and weekend service on most branches to give more riders direct service to Penn Station and provide more evenly spaced departures from Jamaica station. Most rush hour trains won't change, though some will leave up to 3 minutes earlier than they do currently. Riders should check the new schedules or use the TrainTime app to see if their trip has been affected.
Roads and bridges
Several major roads and local streets in Queens will be closed for the US Open tennis tournament all week through Sunday, Sept. 8.
- Grand Central Parkway
- Brooklyn-Queens Expressway
- Cross Island Parkway
- Long Island Expressway
- Whitestone Expressway
- Van Wyck Expressway
- Northern Boulevard between Junction Boulevard and Clearview Expressway
- Shea Road between 126th Street/Seaver Way and Meridian Road
- Roosevelt Avenue between Main Street and 104th Street
- College Point Boulevard between 31st Avenue and Horace Harding Boulevard
- 126th Street/Seaver Way between Roosevelt Avenue and Northern Boulevard
- 111th Street/Saultell Avenue between Roosevelt Avenue and Horace Harding Boulevard
- Astoria Boulevard between RFK Bridge Plaza and 114th Street
- Meridian Road
Read recent transportation stories:
Federal prosecutors in Brooklyn have accused two software developers in Queens of a sweeping, six-year scheme in which they sold shady apps — including one called Screwber — that enabled hundreds of Uber drivers to swindle passengers out of $40 million.
Following an FBI investigation law enforcement officials on Wednesday indicted Eliahou Paldiel, 52, of Queens, and Carlos Arturo Suarez Palacios, 54, of Brick Township, New Jersey, on federal wire fraud and money laundering charges, according to court records. Both men pleaded not guilty and were released on bail; if convicted at trial they each face up to 20 years in prison.
In court documents, prosecutors outlined how Paldiel and Suarez allegedly orchestrated an elaborate plot in which they sold hacked smartphones and access to fraudulent apps to more than 800 rideshare drivers from November 2018 through August 2024. The illicit apps essentially allowed drivers to fake their locations so that Uber’s app would tack on pricey surge charge fees to fares. They would pocket the extra charge.
The indictment does not explicitly name Uber, but a spokesman for the company, Josh Gold, confirmed to Crain’s that the rideshare juggernaut was the target of the alleged fraud.
Paldiel and Suarez allegedly loaded up hacked smartphones, which were manipulated to allow apps not available on official app stores, with two programs called “FakeGPS” and “Screwber.” Drivers used the former app to make it appear that they were driving in areas with surge fees where they were not physically present, while the latter app provided drivers with information about fares that drivers were otherwise unable to access; those details included prospective passengers' destinations and the estimated fare for a trip, court papers show.
Prosecutors said in legal filings that access to the unauthorized information enabled drivers to cherry pick the most lucrative fares — to the detriment of drivers playing by the rules.
All told, the drivers scammed passengers out of $40 million, and Paldiel and Suarez received more than $1.5 million from drivers to subscribe to their services, said law enforcement officials.
The hacked phones, according to court papers, were sold near Paldiel’s Queens home for $600 per device along with a $300 monthly subscription fee to Screwber and a one-time $50 charge to access the FakeGPS app.
Breon Peace, U.S. Attorney for the Eastern District of New York, said the effort was “corrupting the rideshare market at the expense of unsuspecting passengers and hardworking drivers.”
Prosecutors said the pair brazenly bragged about their operation in a November 2018 text message conversation, in which Palediel wrote to Suarez: “You know Screwber is like drugs .. once you get into it you’ll get withdrawals when you can’t get your fix,” and added that “I get them hooked on the software,” according to court papers.
The indictment states that the scam became so popular that during two days in early June law enforcement officials observed “lengthy lines of drivers” waiting to meet with Paldiel in Queens, including several drivers with New York City Taxi and Limousine Commission license plates. On June 26, Palediel sent a message to drivers, stating that they could show up at his home to “pick up” or get “help” with a phone, court records state.
Gold, Uber’s spokesman, said that the fraud had lowered Uber’s utilization rate — the percentage of time a driver spends with a passenger while they are on duty — and claimed that it forced the company to increase driver restrictions to the app. Those restrictions, often referred to as lockouts, have been the subject of driver protests in recent months.
In a statement, Taxi and Limousine Commissioner David Do said the city is working with the FBI to identify city drivers who used the illegal apps and “ensure they never drive for hire in New York City again and, if feasible, recover any overcharges for those harmed.”
Nasdaq’s lease for a Times Square office that served briefly as its post-9/11 headquarters expires tomorrow.
The stock exchange’s decision to not renew, disclosed in a Moody’s report this month, marks the end of its relationship with 1500 Broadway, a 33-story, 500,000 square-foot tower at West 44th Street known for its prominent billboards and holding the studio for “Good Morning America.”
Nasdaq will retain its MarketSite television studio at the corner of Broadway and West 43rd Street from which business leaders celebrate their IPOs, along with its 145,000 square-foot corporate headquarters at 4 Times Square, or 151 W. 42nd St. Nasdaq has sublet most of its 1500 Broadway space for many years.
It will soon be followed out the door by “Good Morning America.” Corporate owner Walt Disney plans to relocate all ABC News staff next spring upon completion of its new New York headquarters, a 1.2 million square-foot tower in Hudson Square developed with Silverstein Properties.
This month Paramount Global said it would let go about a tenth of workers, or 436 people, at its 1515 Broadway headquarters, according to a filing with the state Department of Labor.
1500 Broadway’s looming loss of its two largest tenants poses difficulties for owner Tamares Group, a London-based firm that owns 2.3 million square feet of office space and 1,600 hotel rooms globally, according to its website. Tamares acquired 1500 Broadway in 1995 for a bargain $55 million. The firm did not reply to a request for comment.
Net cash flow at the Class B building could drop next year below the sum needed for debt payments, Moody’s said. The building carries $505 million in debt, including a $335 million mortgage and $170 million in mezzanine debt. The mortgage, with a 3.84% interest rate, matures in October and has been sent to special servicing. Moody’s said Tamares have been in negotiations for a new loan since January and some lenders have conducted “preliminary underwriting” but nothing has been finalized.
Tamares extracted $176 million in cash from the building when the mortgage was last refinanced in 2014, according to DBRS Morningstar.
Nasdaq leased space at 1500 Broadway in 2002, when it needed a home after 9/11. A year later the exchange returned downtown to 1 Liberty Plaza. In 2018 it headed back uptown and consolidated its footprint around Times Square. Nasdaq declined to comment.
A Tribeca property home to two popular restaurants — one of them a Michelin-starred sushi joint — sold to new owners earlier this month, records show.
Alchemy Ventures, a real estate firm based in the Financial District, scooped up 251 Church St. through an entity named after the address for $12.6 million, according to a deed that appeared in the city register Friday.
The 5-story, L-shaped building, which has an alternate address of 69 Leonard St., contains seven rental apartments and two eateries on the ground floor: the Australian cafe Two Hands and the famed omakase-style restaurant Shion 69 Leonard Street, led by Tokyo-trained executive chef Shion Uino.
Founded in 2014, Alchemy Ventures, an affiliate of Alchemy Properties, has a growing portfolio focused mainly in Brooklyn, Manhattan and more recently Kansas City, Missouri. Alchemy Properties famously converted the Woolworth Building at 233 Broadway from offices into luxury condominiums in 2017.
Samuel Kooris, a co-founder and principal at Alchemy Ventures, told Crain's Friday that he expects his firm to invest in minor upgrades to the 14,425-square-foot property near Sixth Avenue but otherwise intends to manage it as is.
Alchemy Ventures partnered with S&A Capital Group, an affiliate of Hong Kong-based S&A International Holding Limited, to acquire the mixed-use building. The joint venture secured a $7.6 million loan from Citizens Bank to finance the deal, records show.
The Tribeca building was sold by another limited liability company named after the address, whose signatory was Zach Gindi. He is unrelated to the well-known business family with the same surname known for founding the Century 21 department stores and its real estate firms Gindi Equities and ASG Equities, according to Jennifer Beemish, operations manager at Gindi Equities.
Brokers Maurice Suede, Eric Roth and Brett Seigel of Newmark represented both sides in the transaction.
Leases
Dry cleaner takes space in Hell’s Kitchen
Address: 439 W. 50th St., Manhattan
Landlord: Centennial Properties
Tenant: Dry Clean Depot
Lease size: 1,000 square feet
Asking rent: $100 per square foot
Asset type: Retail
Brokers: Nest Seekers International’s Jennifer McClaren represented the tenant. Meridian Capital Group’s Ben Biberaj and Elliot Wygoda represented the landlord.
Sales
Woolworth condo developer buys prewar Tribeca walk-up
Address: 251 Church St., Manhattan
Seller: Zach Gindi
Buyer: Alchemy Ventures
Sale price: $12.6 million
Asset type: Mixed-use
Rainbow Shops apparel chain acquires SoHo storefront
Address: 597 Broadway, Manhattan
Seller: Laura Hoffman
Buyer: Gabriel Chehebar
Sale price: $6.5 million
Asset type: Retail
An acclaimed artist couple from China who bought their first apartment after being stranded in the city during the height of the Covid-19 pandemic have apparently grown to like New York so much they’ve bought a second unit at the address.
Xiaodong Liu and his wife, Hong Yu, have purchased the penthouse at the boutique condo 45 Greene St. in SoHo, records show. Both are prominent portrait painters who between them have earned shows at the Venice Biennale and other major art exhibitions.
The unit, which closed Aug. 15, cost $9.6 million, according to a deed that appeared in the city register Wednesday.
A multi-floor three-bedroom whose 2,900 square feet includes a 950-square-foot great room, the penthouse also comes with 2,300 square feet of terraces, one of which sports a small outdoor swimming pool.
The deal comes four years after Liu and Yu bought a unit located one floor below the penthouse, which is in a cast-iron building near Broome Street. That unit, a two-bedroom, cost $3.8 million, according to its deed, which appeared in the register in July 2020.
Whether the couple plans to combine the units or keep them separate is unclear. An effort made to contact them through the penthouse’s listing agent, Andy Klaric of Serhant, was unsuccessful by press time.
Liu and Yu appear to have acted quickly on the penthouse. Klaric listed the top-floor unit in May, and it was on the market for only a few weeks before going into contract, according to StreetEasy.
The seller of the penthouse, Kieran Fitzgerald, appears to have made out well. He paid $7.7 million for the spread in 2022, meaning he nabbed a 25% profit after holding the home for just two years. The attorney who represented him at the closing, Samantha Banilivy of the firm Krauss Legal, did not return a phone call seeking comment.
In winter 2020 Liu was wrapping up an assignment painting residents of the U.S.-Mexico border for a show in Dallas. But he could not complete his journey back to his home in Beijing because of pandemic-related travel restrictions, according to an article in the online arts magazine Hyperallergic, and so touched down in New York instead.
Yu and the couple’s daughter happened to be in the city at the time, so the family wound up quarantining in New York together—and painting as well.
True to his hyper-realist style, Liu completed work during the period that features lifelike streetscapes of people gathered at the High Line and other iconic sites wearing masks. He also chronicled some of the Black Lives Matter protests that followed the murder of George Floyd that spring. The couple made their first apartment purchase in the city soon after.
Yu scored a major exhibition earlier this year in Venice at a show sponsored by the Guggenheim Museum called “Another One Bites the Dust.” Her piece, presented inside an historic Italian church, featured an array of large panels with hyper-realistic depictions of people lying down and sitting meant to symbolize all the stages of life.
Both Yu’s and Liu’s paintings regularly sell at auctions for hundreds of thousands of dollars, and sometimes in the millions, according to news reports.
Red Hook may be best known for its sprawling commercial projects, but one developer plans to add a new residential building to the Brooklyn waterfront neighborhood.
Brooklyn-based Heights Advisors is developing a project at 159 Van Dyke St. that will span about 30,000 square feet and stand five stories and 40 feet tall with 20 residential units, according to plans recently filed with the Department of Buildings. The project will also include 23 parking spots and a health care facility on the ground floor, the filing says.
The site is currently home to a two-story industrial building spanning about 4,000 square feet; an entity linked to Heights Advisors purchased it in 2018 for $3.6 million, according to city records.
A representative for Heights Advisors did not respond to a request for comment by press time.
The firm is run by Alain Kodsi and has developed projects in Brooklyn, Manhattan and Philadelphia ranging from homeless shelters to luxury condos. Its developments include condo buildings at 425 W. 53rd St. in Hell's Kitchen and 79 Columbia St. in Cobble Hill. One of its projects, a homeless shelter in Crown Heights that opened in 2017, was reportedly planned as a condo at first and faced fierce neighborhood opposition.
Kodsi himself has faced multiple controversies during his career as well. A federal judge convicted him in an insider trading scheme in 2002, and his family paid about $3 million in fines. He was also sentenced to eight months in prison for a separate insider-trading scheme that he pleaded guilty to in 2006.
Kodsi listed his Cobble Hill townhouse at 118 Amity St. in early 2023 for $9.4 million, one of the most expensive homes being marketed in the borough at the time. However, he ended up leasing the house rather than selling it, according to Leslie J. Garfield and Co., the brokerage handling the property.
Other major projects planned for Red Hook include an 8-story, 371-unit residential development at 498 Columbia St. and a 225,000-square-foot film and television production facility at 145 Wolcott St. The Brooklyn neighborhood is fairly difficult to reach by public transit and has not seen quite the same surge in residential projects that have recently come to other parts of the borough.
A decade ago, it was dusky green matcha. Then came masala chai, yuzu and ube. Now another distinct Asian ingredient is wending its way through New York City’s dining scene.
Pandan is a staple ingredient in Southeast Asian cuisine, used to give beverages, desserts and savory dishes a simultaneous hit of sweetness and earthiness. The blade-like leaves, which grow at least two feet long, are believed to have come from the present-day Moluccas islands in East Indonesia. One of the first recorded reference to pandan was in 1832.
A slew of well-known dishes feature the fragrant herb: gai hor bai toey, a Thai fried chicken dish; nasi lemak, a Malaysian favorite where the rice is cooked with coconut milk and pandan leaves; and banh bo nuong, a brightly green-hued honeycomb cake from Vietnam.
“Without it, it’s pretty obvious. Your food loses a signature whiff and flavor,” says Sharon Wee, a New York-based Singaporean cookbook author. Pandan’s fresh taste, which is imbued by either simmering it with other ingredients or blending it to create an extract, cuts out the heaviness from the coconut milk, sugar and chicken fat that it’s often used with, she adds.
Now pandan is popping up across the city, and not just at Southeast Asian bakeries such as Bánh by Lauren and Lady Wong. In May, Cronut creator Dominique Ansel featured a strawberry pandan filling for his signature treat to celebrate the famed pastry’s 11th birthday. Before that, he served pandan coconut chiffon cake and pandan coconut almond bostock — a version of the classic French pastry that he made by soaking brioche in pandan coconut custard, then baking it with almond frangipane — at his Flatiron District bakery, the Workshop.
Beyond its evocative vanilla and coconut notes, pandan’s naturally vibrant mint color lends itself to pastries, said Ansel in an email. “A lot of people out there have never had pandan before, so it’s always fun to experiment and introduce our guests to new ingredients.”
Baldor Specialty Foods, an East Coast distributor that supplies to notable restaurants and bars in the region, says it had 15% more unique customers from January to June this year ordering pandan leaves than in the same period last year.
Besides the herb’s social-media-friendly hue, pandan’s growing popularity may have something to do with demographics. The population of people of Southeast Asian descent in the U.S. grew by 13% from 2012 to 2022, according to a Bloomberg calculation of census data, while America’s population rose by only 6.2% in the same period.
In the U.S., frozen pandan leaves are readily available in Asian grocery stores. So is pandan extract, though cooks see them as second-best to the actual leaves. Neither cost more than a few dollars: Packets of 4 or 8 ounces can sell for under $3. A similar amount of an equally fragrant flavoring agent, vanilla beans, costs at least 20 times the price.
Given its floral, earthy taste, bartenders have been experimenting with pandan too. At Mace, owner Nico de Soto created a pandan cocktail using a salted pandan syrup, burnt butter, hay bourbon and cedar wood bitters. Bourbon’s woody flavor “match[es] perfectly” with pandan, he says.
The French bartender said he fell for the herb in in 2010, when he tasted a pandan cake for the second time, and started using it in drinks to give them a long, nutty finish. “When you put it in the cocktail with all its layers, and then at the end, the pandan strikes and just stays there for a minute or two—it’s just amazing.”
De Soto is so taken with pandan that he recently launched a pandan liqueur called Kota that’s distributed to bars in France. Later this year it will be available in the U.K. and Germany; next January it will arrive in U.S.
At The Clocktower, a restaurant and bar near Madison Square Park, pandan is infused in bourbon for two days and then mixed with a banana liqueur and demerara sugar to create the Polynesian, a drink introduced last fall.
Mark Murphy, director of bar operations at Clocktower’s parent company Starr Restaurants, describes the plant’s flavor profile as “vegetal yet marshmallow,” helping to round off the darker whiskey notes.
The cocktail has gotten mixed reactions so far, he says. The ingredients don’t read to normal whiskey drinkers — pandan’s tropical nature appears to pair better with rum. “But those who try it say they enjoy it,” Murphy adds.
Pandan is still a niche product in the US, appearing only on 0.8% of U.S. menus, according to figures from food and beverage data provider Datassential. It’s still mostly found at restaurants serving Southeast Asian food. But it’s popping up on American-focused menus, which is generally the first sign of a trend, says Claire Conaghan, Datassential’s associate director and trendologist.
“After ube’s success due to an approachable flavor and gorgeous color we expect pandan isn’t far behind,” she says.
Outside entrepreneurs may soon be invited to pitch more of their ideas to city government in hopes of scoring contracts, under a new rule advanced by Mayor Eric Adams’ administration on Wednesday.
Typically, when the city turns to outside companies for help, a city agency identifies both the problem and a proposed solution, then tasks those vendors with implementing the solution. The new method instead asks those businesses to propose ideas themselves — a system known as “challenge-based procurement” that is intended to spark more innovation.
Rule changes that would encourage the use of challenge-based procurement went before the city’s Procurement Policy Board on Wednesday. The Adams administration will likely finalize the policy in the coming weeks — despite some objections raised by a watchdog group that argued it could pose privacy risks and leave the city at the whims of profit-motivated companies.
“It’s a common feature of aggressive corporate-capture strategies to get a foot in the door” through a short-term pilot contract, “and then become the only available service provider,” said Cynthia Conti-Cook, director of research and policy at the nonprofit Surveillance Resistance Lab, who testified against the challenge-based procurement proposal on Wednesday.
Challenge-based procurement is a hot topic in the lively world of government contracting. California has employed a similar method since 2019, using it to test out firefighting technologies. The governments of Canada and Copenhagen have also asked private companies to propose their own fixes to public problems.
The Adams administration, which has pushed to loosen other bidding rules in hopes of speeding up contracting, first floated the idea of challenge-based procurement in a 2023 report aimed at boosting innovation in the city. Adams himself, a self-proclaimed “tech mayor,” has also shown an affinity for sometimes unproven technological solutions, like gun detectors at subway stations.
Although city agencies technically have the ability already to solicit solutions from vendors, the new rules aim to promote the practice more widely. To implement challenge-based procurement here, the administration is proposing to expand the use of demonstration projects, which allow companies to sell the city on a product through a short-term pilot.
Demonstration projects are relatively rare — last year the city signed just eight, totaling $11 million, or .08% of all new contracts — but those deals can lead to more lasting contracts. ShotSpotter, the gunshot-detection software recently deemed ineffective by the city comptroller, scored its $55 million contract with the NYPD after an initial demonstration in 2014.
Conti-Cook argued that expanding challenge-based procurement could put the city at a disadvantage by allowing entrepreneurs to position themselves as the only solution to a given problem. She also suggested it could allow companies to extract data from residents, pointing to a 2017 finding that the private operator of the LinkNYC Wi-Fi kiosks had failed to anonymize the addresses it collected from New Yorkers.
Liz Garcia, a City Hall spokeswoman, said in an email that encouraging challenge-based procurement will not change any of the existing policies that govern how companies can use sensitive data. She said the method “has become seen as a best practice of government, and private, procurement.”
“Challenge-based procurement will allow us to engage service providers in a new, creative way,” Garcia said, pointing to potential innovations in public safety, affordability and quality of life.
The administration’s proposed rule changes would also expand the overall use of demonstration projects by deleting a requirement that they only be used for “client services” — programs where the city is working on behalf of a third-party client for services like housing or legal aid.
City Comptroller Brad Lander’s office has raised its own mild critique of the administration’s proposal. In a July public meeting, Charlette Hamamgian, the deputy comptroller for contracts and procurement, said that the policy should be tweaked to encourage more competitive bidding by compelling agencies to study the results of a demonstration project before renewing the contract.
In a statement on Wednesday, Hamamgian suggested the comptroller’s office has no objections to the proposal overall, saying it does not “pose a risk to the city’s oversight of technological procurements” or block the comptroller from reviewing contracts.
A spokeswoman for Jennifer Gutierrez, the chair of the City Council’s technology committee, said the council plans to ask the administration about the policy during a September hearing.
New York City could be on the hook to pay for solutions that help address potentially lethal gaps between subway platforms and trains because the city is the subway system’s landlord, a New York state judge said in court papers.
Manhattan State Supreme Court Judge Richard Tsai has refused the city’s request to be dismissed from a 2022 class-action lawsuit filed by New Yorkers with disabilities that demands the Metropolitan Transportation Authority close gaps between subway trains and station platforms. The issue of several-inch gaps – either vertical or horizontal – is especially dangerous to riders who are blind or who use a wheelchair but could pose a safety issue for all travelers. A large gap led to the death of a Brooklyn straphanger as recently as 2022.
It’s unclear precisely how many platforms would be impacted, and thus how much such an investment would cost. But the effort would likely come with a multi-million dollar price tag.
In court papers the city argued that because it merely leases the subway system to the MTA’s New York City Transit Authority that it does not control the system, and therefore has no obligation under the city’s human rights law to fix the gaps. But Tsai flatly rejected the argument and ruled that the city’s duty to ensure the system is accessible is “nondelegable.”
“As the City does not dispute that it owns the subway, it cannot escape liability by relying upon the fact that it had leased the premises,” Tsai wrote in court papers.
The city’s law department declined to comment on the judge’s ruling. The next court hearing for the case is scheduled for Oct. 24.
Now that the lawsuit is advancing, Tsai’s decision to keep the city at the table means that both the MTA and the city could be compelled to do the work. Transit systems in New Jersey, Boston and Chicago use devices known as bridge plates, which are essentially retractable ramps, to span gaps between platforms and trains.
In New York, the MTA currently employs retractable gap fillers to bridge space at the 14th Street-Union Square platform for the 4, 5 and 6 lines; the fillers were installed in 1914 due to the station’s sharp curve.
Just over a quarter of the system’s 472 subway stops currently comply with the federal Americans with Disabilities Act. The MTA has earmarked more than $5 billion toward accessibility upgrades at 70 subway and Staten Island Railway stations as part of its 2020-2024 capital plan, but some of those investments are in jeopardy with congestion pricing on hold.
A 2013 New York City Transit Riders Council report on the system’s gaps drew attention to problem areas: among them is a six-inch vertical opening at the southbound C train platform at 50th Street in Manhattan and a six-inch horizontal gap between northbound B trains at 59th Street-Columbus Circle.
Investing in filling gaps across the system stands to improve service for senior citizens, parents with baby strollers and all other riders who use the system, said Chris Schuyler, managing attorney of the disability justice program with the New York Lawyers for the Public Interest, which is representing the plaintiffs in the lawsuit.
“Subway accessibility, while necessary and essential for people with disabilities, really helps all riders of the system,” said Schuyler in an interview. “These improvements would benefit all riders and bring the subway system up to the standard of what people expect of New York City.”
Fertility startup Kindbody is working to raise money in a funding round that would give the company a significantly lower valuation, a letter sent to potential investors and viewed by Bloomberg shows.
Kindbody is seeking to raise $30 million to $50 million by mid-September in new financing that would put the startup’s pre-money valuation at $600 million, according to the letter, the contents of which were confirmed by multiple people. The company had previously earned a $1.8 billion valuation, including dollars raised. The terms of the latest funding effort were set by a new “blue-chip growth equity investor” who plans to inject at least $10 million into the company, according to the letter.
Kindbody spokeswoman Margaret Ryan said in a statement that Bloomberg’s reporting for this story “contains multiple factual inaccuracies.” The company declined multiple requests to elaborate on the statement.
Kindbody has marketed itself as a fertility services provider that can offer lower prices than competitors and enjoys a market advantage because it owns and operates clinics, unlike some rivals that serve as middlemen. Bloomberg reported in November that the company had posted larger-than-projected operating losses and wasn’t expecting to turn a profit until mid-2024, citing people with direct knowledge of Kindbody’s situation.
The startup has cited a number of reasons for falling behind on financial estimates: Fewer employees at Kindbody’s client companies have used its fertility benefits than expected. And Walmart — one of the company’s largest clients — was estimated to have a smaller fertility-eligible population than previously planned, Bloomberg reported at the time.
Founded in 2018, the Flatiron District-based startup grew rapidly by offering in-vitro fertilization and other services such as egg freezing and storage. The company markets directly to consumers and has also served as an employer benefits provider to companies like Walmart and Tesla.
Its growth was helped along by venture capital funding and debt, allowing Kindbody to open new clinics and make acquisitions expanding its presence. The most notable deal was in 2022 when the company bought Vios Fertility Institute, a fertility network with facilities across the Midwest that doubled Kindbody’s footprint to 26 clinics at the time.
In recent months, the company has worked to cut costs, closing multiple clinics including ones in Detroit and Illinois, according to Kindbody’s website and emails sent to patients and viewed by Bloomberg. The closures resulted in some job losses, according to people familiar with the matter said, asking not to be identified because the information isn’t public.
The company has also seen turnover among doctors, with four leaving the company this year, according to LinkedIn profiles and press releases. Four doctors departed from Kindbody in a matter of months at the end of last year, people with direct knowledge of the departures said, asking not to be identified because they aren’t authorized to speak publicly. In total, Kindbody employs at least 27 fertility doctors, according to its website.
Hans Morris, who headed Visa when the credit-card giant completed its enormous $20 billion IPO, has sold his Carnegie Hill townhouse.
The 7,100-square-foot, prewar property, which is located at 15 E. 93rd St. near Central Park, traded for $12.2 million, according to a deed that appeared in the city register Tuesday. The six-bedroom, stoop-fronted home went into contract June 18 and closed Aug. 14, the deed says.
Morris and his wife, Kate, a banker turned philanthropist, had asked $15.9 million last summer when initially listing the home, which sits between Fifth and Madison avenues. But twice they had to decrease the price to sell the 1892 structure, which also features five full and two half baths, an entire floor dedicated to the primary suite plus a paneled library, and a 700-square-foot, bluestone-lined backyard.
Although the final result was 25% less than what the Morrises sought, the couple does seem to have come out ahead, after paying about $7 million for the property in 1994, according to the register.
The buyer, shell company 201 Quincy LLC, which borrowed $8.5 million from JPMorgan Chase to finance the deal, was represented by real estate attorney Robert Frankel, a partner at the New York firm Cohen & Frankel. A phone message left for Frankel was not returned by press time.
And the agents for the two brokerages that co-marketed the property, George Vanderploeg of Douglas Elliman and Susan Baker of Sotheby’s International Realty, both declined to comment, so it’s unclear which of them can take credit for the sale.
A longtime executive in Citi’s investment banking division, Morris was recruited by Visa in 2007 to serve as the president as the company consolidated various divisions and prepared for the public offering, the largest ever at the time. Morris stayed on at Visa till 2010, when he reportedly exited with a $24 million package.
Since 2014 Morris has served as managing director of Nyca Partners, a venture capital firm focused on fintech startups with 80 companies under its belt, according to Nyca’s website. He also chairs the board of Lending Club, a peer-to-peer bank often used for resolving credit-card debt.
After stagnating for many months amid elevated interest rates, home-sale activity showed hints of strength in the spring, as sellers and buyers seem to have come to terms with the fact that loan costs won’t drop dramatically soon.
Quest Diagnostics plans to acquire some outreach laboratory assets from a Cleveland-based health system.
Quest, which is based in Secaucus, New Jersey, and University Hospitals have entered a definitive agreement and expect the deal to close in the fourth quarter pending regulatory approval, the company said in a Wednesday news release. Financial terms were not disclosed.
University Hospitals offers services such as cytology and surgical pathology testing at outreach locations, according to the health system's website.
Last month, Quest announced plans to acquire the majority of Columbus, Ohio-based OhioHealth's outreach testing, including all non-inpatient and non-outpatient lab assets. In June, it said it planned to acquire most of the laboratory assets of Minneapolis-based Allina Health's ambulatory clinic sites. Both transactions are slated to close in the fall, pending regulatory approval.
Quest Diagnostics and University Hospitals did not immediately respond to requests for comment regarding which outreach laboratory assets would be involved in the transaction or whether jobs would be cut as a result of the deal.
This article originally appeared in Modern Healthcare.
When Dan Yafet’s son moved out of their apartment in Fort Greene, he found himself with too much space and not enough money — so he took on an octogenarian roommate.
Now Yafet, a 68-year-old who works for an architect’s office, shares his fourth-floor walk up with 86-year-old Alan Ferber, splitting the $2,000 monthly rent for the two-bedroom apartment.
“We don't throw parties, but it’s a good setup,” Ferber said. “We don't get in each other's way, and we like each other.”
An uptick in so-called “boommates” — roommates of the baby boomer generation — is the latest manifestation of a housing affordability crisis that’s slammed Americans of all ages, especially those in expensive cities like New York. To make ends meet, an increasing number of those 65 and older are choosing shared housing arrangements, helping save money in an era when many have fallen behind on retirement savings and there’s increasing concern about a loneliness epidemic.
Harvard University’s Joint Center for Housing Studies estimates that almost a million people over the age of 65 now live with unrelated housemates. Roommate finder sites have seen an influx of older users, with SpareRoom experiencing its fastest growth among that cohort. And one in four roommates is aged 45 or above, according to the site, a figure that’s more than doubled in the past decade.
“There's been a big bump in housing costs, and that's forced people from a financial standpoint to either cut back or find ways like this to cut these costs,” said Jamie Battmer, chief investment officer at wealth management firm Creative Planning. “We’ve got this big group of people entering the prime years of retirement, so you're going to have more people doing this.”
Affordable housing
Versions of these shared living setups have existed for years, but they’re increasing in popularity as a surge in prices for housing, and pretty much everything else, coincides with the baby boomer generation entering retirement. There were 58 million Americans ages 65 and older in 2022, up from 43 million in 2012, according to Harvard’s JCHS. And a record 4.1 million Americans will turn 65 this year and every year through 2027, data from the Alliance for Lifetime Income shows.
Even though inflation has cooled, senior adults are struggling to afford costs that have skyrocketed the last few years. In 2021, more than 11 million were cost-burdened, meaning they spent more than 30% of their household income on housing. While many retirees own their homes outright, others are stuck with high mortgage or rent payments.
In New York, rent has shot up 33% from prepandemic levels, and nationwide that figure is about 30%. For homeowners, increased costs for taxes, insurance and utilities have surged 26% since 2020.
“We've seen an increase in older adults who are carrying mortgages on their primary homes including among people who are 80 and over,” said Jennifer Molinsky, a project director at Harvard’s JCHS. “And for those folks and for renters the cost burden rate is much higher. There's a much greater struggle with affordability. As we have more and more people in their eighties and over, that's a time when incomes really can't necessarily keep up with housing costs.”
Joseph Iorio, 71, took on a roommate after his partner died in 2022, leaving him struggling to afford the mortgage payment on his three-bedroom house in Charleston, South Carolina.
Wanting to retire in a warmer climate, he and his partner moved to the state from Minnesota in 2019 and paid $230,000 for their home. After refinancing during the pandemic for a 2.2% mortgage rate, his monthly payment is about $1,200, but he also has a mountain of debt from a failed business venture and even considered filing for bankruptcy. Instead, he decided to try a roommate, finding a 49-year-old man who pays $1,000 a month.
That’s allowed Iorio, who makes about $2000 a month as a chauffeur, to pay down his debt faster while still making his car and home payments on time. It’s also allowing him to save more for when he can no longer work, something that many Americans are struggling to do.
More than half of baby boomers are at risk of a retirement shortfall, according to a Morningstar report released this month.
“Having the roommate income makes a huge difference,” he said. “I don’t think I would be able to send all this money out if I didn’t have him.”
Reducing loneliness
Linda Hoffman runs the New York Foundation for Senior Citizens, a nonprofit that hosts a program focused on matching older adults with roommates. Hoffman said that when she started the program back in 1981 she only had 10 matches. This year so far she’s had more than 30. Over the years, Hoffman said she’s noticed people’s needs have changed — in the past many were motivated by loneliness, now the need for a roommate is more financial.
“It’s a win for the homeowner or renter who is the host — those individuals are able to remain in place where they are and can afford to do so,” said Hoffman. “It’s a real win for the guest because they are able to receive affordable housing.”
That’s how Marcy Arlin, 73, and Gayoung Lee, 25, ended up living together in Bay Ridge. Arlin, a former theater director and professor, has lived in Brooklyn since 1980 and had been married for 25 years. Her husband passed away eight years ago and after she lost her teaching job in 2023 she realized she needed a roommate.
“Rent has gone up, my health insurance has gone up, my car insurance has gone up — everything has gone up,” said Arlin. “I was eating too much into my savings.”
Meanwhile Lee, a current graduate student at NYU’s science journalism program, was looking for somewhere quiet to live after enduring NYU’s East Village dorms. She moved into Arlin’s two-bedroom apartment about three months ago and pays her $1,000 a month. Arlin’s two cats, Luka and Didi, have been a source of bonding for the two.
“She’s such a great person to talk to about what's on your mind — she’s experienced so much, she gives really good advice,” Lee said. “That’s been really good for me and I get a lot more time to focus on myself professionally and personally, which I don't think I've been able to do since coming to New York.”
Suburban lawmakers are renewing their vows to fight congestion pricing after Gov. Kathy Hochul said Monday that she intends to announce a replacement plan for the toll as soon as the end of the year.
Hochul said she will roll out a plan to revise or replace the $15 charge on motorists entering Manhattan south of 60th Street before the end of 2024, likely after November’s elections, or early next year, Politico first reported. The prospect has raised the hackles of some suburban lawmakers, who say a replacement proposal is a fresh opportunity to fight for carve-outs for their constituents.
“I won’t support a proposal that doesn’t exempt Orange County drivers,” state Sen. James Skoufis told Crain’s. “Perhaps for some this is a politically uncomfortable conversation to have, but if we're going to do this in a fair-minded way, we have to have that conversation.”
Skoufis added that he believes suburban lawmakers in the state Legislature will be “an extremely important voice” in amending or shaping an alternative to congestion pricing, which was set to raise $15 billion for the Metropolitan Transportation Authority for mass transit upgrades for the subway, buses and commuter rail lines.
On Wednesday elected officials with the town of Hempstead in Nassau County held a news conference to remind lawmakers of the Long Island town’s opposition to congestion pricing and of their lawsuit seeking to block it outright, in part because of the financial burden they argue it would create for local drivers.
"Let's stand up for residents and do the right thing and find a way to save them money," said Hempstead Supervisor Donald Clavin during the news conference.
MTA officials expected to launch congestion pricing, which was approved by the state Legislature in 2019, at the end of June, but Hochul abruptly halted the toll on June 5. The new toll, she said at the time, risked the city’s economic growth and would financially burden businesses and residents grappling with inflation.
But Hochul reportedly also shelved the plan owing to political concerns. Polls of New York voters have long shown that the toll is unpopular. And Hochul’s decision came five months before the November elections, in which half a dozen battleground races in New York could determine control of Congress.
“It’s always been about the suburbs,” Hank Sheinkopf, a Democratic political consultant, told Crain’s. “It’s all about the cost for their constituents and the fear that if enacted they would pay a price in that the Democratic majority would lose seats in the suburbs and outer boroughs.”
The developers behind a Downtown Brooklyn office tower that rose on top of what used to be an Abraham & Straus department store and is now a Macy's, have locked in a $301 million refinancing loan, according to city records and information from the developer.
Global real estate firm Tishman Speyer, whose Manhattan headquarters are in Rockefeller Center, signed for the mortgage from Barry Sternlicht's Starwood Property Trust, according to documents that appeared in the city register Tuesday.
The loan from the Connecticut-based firm, which also has offices in Miami, replaces an investment of the same amount that Starwood provided in 2021, said Bud Perrone, a spokesman for Tishman Speyer. Perrone declined to provide more information about what the most recent loan is for or why it needed to be replaced.
Completed in 2020, the 10-story office building, dubbed The Wheeler, sits above the restored 4-story Macy's at 422 Fulton St., which took over the space in the 1990s from Abraham & Straus — once considered the "reigning queen of Brooklyn department stores," The New York Times reported several years ago. Macy's still maintains the first four floors of the building.
The Wheeler, which has an alternate address at 181 Livingston St., also partially connects with the 9-story Art Deco building next door, which formerly housed portions of A&S and is now home to offices. And it is around the corner from 11 Hoyt St., a 51-story condo tower that Tishman Speyer erected atop the old Macy's parking lot.
The 613,000-square-foot Wheeler building, between Hoyt Street and Gallatin Place, is less than half occupied. Its major tenant, St. Francis College relocated from its longtime Livingston Street campus into the Wheeler in 2021, taking over floors five through seven.
Leases
Law firm inks FiDi lease
Address: 60 Broad St., Manhattan
Landlord: Piedmont Office Realty Trust
Tenant: Edelman & Edelman
Lease size: 10,000 square feet
Asset type: Office
Brokers: CBRE's Rob Wizenberg represented the tenant. A JLL team led by John Wheeler, Robin Olinyk and Thomas Swartz represented the landlord.
GFP lands new tenant at Film Center Building
Address: 630 Ninth Ave., Manhattan
Landlord: GFP Real Estate
Tenant: Encore Community Services
Lease size: 5,521 square feet
Lease length: Six years
Asset type: Office
Brokers: Avison Young's Nicola Heryet represented the tenant. Matthew Mandell represented the landlord in-house.
Outdoor furniture company takes space in Midtown South
Address: 175 Madison Ave., Manhattan
Landlord: GFP Real Estate
Tenant: Vondom
Lease size: 2,850 square feet
Lease length: Seven years
Asset type: Retail
Brokers: Isaacs and Co.'s Marc Simon represented the tenant. Newmark's Andrew Taub and Benjamin Birnbaum represented the landlord, along with Allen Gurevich in-house.
Sales
Bank buys block-long Midtown site across from revamped headquarters
Address: 250 Park Ave., Manhattan
Seller: AEW Capital
Buyers: JPMorgan Chase & Co. and Hines
Sale price: $320.2 million
Asset type: Office
Korean church snaps up Upper West Side synagogue facility
Address: 176 W. 105th St., Manhattan
Seller: Congregation Romemu
Buyer: World Mission Society, Church of God
Sale price: $10 million
Asset type: Religious
Brokers: Open Impact Real Estate's Julia Fish, Alexander Smith and Stephen Powers represented the seller.
An already massive affordable housing complex on Coney Island could more than double in size if a proposed rezoning goes through.
Bronx-based developer Proto Property Services hopes to bring a 17-story project with up to 415 residential units to 2950 W. 24th St., according to a rezoning application the company recently filed with the Department of City Planning. The site is already home to a 19-story building called Ocean Towers with 360 residential units, and the new building, called the Ocean Queen, would go up behind the current building and share a courtyard with it, according to Proto.
The Ocean Queen would span up to about 440,000 square feet, including up to 15,000 square feet of community space and 10,000 square feet of retail space. The retail space would likely be for a supermarket, while the community space would likely be for a day care. There would be a playground and a parking lot for 143 cars as well, slightly less than the number of current spots at the site, according to the developer.
The new building would be entirely affordable, and the area median income levels would likely top out at around 60%, or roughly $84,000 for a family of three, according to Proto Property Services.
The developer bought the Coney Island site in 2013 for $35.6 million, property records show.
If approved, the Ocean Queen would add to the boom in development Coney Island has seen recently. Several large apartment buildings have gone up along Surf Avenue over the past few years, and Manhattan-based developer Helm Equities is planning one at 2201-2227 Neptune Ave. that would stand 18 stories tall with 145 units.
The neighborhood also has a chance at getting one of New York's hotly anticipated downstate casino licenses, as landlord Thor Equities has pitched a $3 billion project for Coney Island that would include a convention center and hotel.
Mayor Eric Adams is directing city agencies to pore over their property holdings in hopes of finding sites that could accommodate new housing — a search that will encompass thousands of lots around the five boroughs.
In an executive order issued Wednesday, the mayor created a task force with representatives from departments like Parks, Sanitation, Transportation, Police and Fire to review land that they own and control, “to identify potential sites for housing development.” Quasi-independent agencies like the Economic Development Corp., Education Department, the three library systems and the New York City Housing Authority will also be consulted, the order says.
It is the city’s latest effort to chip away at a housing shortage estimated to number hundreds of thousands of units, which has pushed rents to record highs and resulted in a vacancy rate of just 1.4%. About 16,600 sites are owned by city agencies or public authorities like NYCHA, according to a list kept by the City Planning department.
Those properties range from sanitation garages to parking lots to at least 2,300 vacant lots, according to the database. A Sanitation Department spokesman said that agency has about 160 properties, including transfer stations and a tiny former break facility for sanitation workers in Tribeca.
“If there’s any land within the city’s control that has even the remotest potential to develop affordable housing, our administration will take action,” Adams said in a statement. The administration hopes to identify the sites that could accommodate housing by the start of next year.
Other city officials have pointed to publicly owned land as an obvious opportunity for new development, especially given that the government could allow for more affordable housing since it lacks the profit motive of a private developer. Mark Levine, the Manhattan Borough President, spotlighted several city-owned sites when he released a list last year of 171 lots across the borough that he deemed suitable for new housing.
Two private developers received financing this year to build a 158-unit affordable development on a site at 10th Avenue and West 48th Street in Hell’s Kitchen that is owned by the Department of Environmental Protection. And the city in June inaugurated a fully affordable, 14-story building in Inwood that was constructed atop a public library branch.
Adams’ new task force will be chaired by Maria Torres-Springer, the deputy mayor overseeing housing.
Adams’ City of Yes plan that would relax zoning rules to accommodate some 100,000 new homes is currently under review by the City Planning Commission, and will face a City Council vote this fall.
Home prices are higher. Stocks are higher. And so is the sum Americans think they need to feel rich.
Americans on average believe it takes a net worth of $2.5 million to be considered wealthy in 2024, according to annual survey results released Wednesday. That’s a 14% jump from last year, when the Charles Schwab Modern Wealth survey found Americans thought it took $2.2 million to be rich.
“The notion of wealth combines both numbers and emotions,” said Rob Williams, managing director of financial planning at Charles Schwab. “The jump from $2.2 million to $2.5 million demonstrates both sides — the cost of living is rising, as are, it’s likely, most Americans’ more emotion-fueled views of what it takes to be wealthy.”
The older someone is, the higher their definition of wealth in the survey. Baby boomers said being wealthy takes $2.8 million, while millennials peg it at $2.2 million. Overall, slightly more than one-in-five Americans said they were “on track” to be wealthy, and 10% said they were wealthy already.
When asked what average net worth you’d need to be considered “financially comfortable,” Americans said $778,000 — a big drop from last year’s results and on par with 2022 results. As inflation remained hot in 2023, the number rose to $1 million, the highest reading since the survey’s 2017 start.
Members of Gen X, many of whom are now supporting children and aging parents, cited the highest average net worth needed to be comfortable, at $873,000. That’s 12% higher than the answer from boomers, and 20% above the estimate from millennials.
The online survey by Logica Research reached a nationally representative sample of 1,000 Americans between ages 21 and 75 in March.
One more down, one to go.
The Aman New York Residences, the blockbuster 22-unit condo atop the Aman hotel at 730 Fifth Ave. on Billionaires Row, has unloaded its second-to-last sponsor unit.
No. 16B, a two-bedroom, closed Aug. 14 for $20.3 million, according to a deed that appeared in the city register Tuesday.
A veil of secrecy has shrouded several aspects of the condo project, which was developed by a team led by the Vladislav Doronin-helmed OKO Group of Florida. For starters, OKO did not publicly market the condo. And most of the buyers in the tower, which set sales records, cloaked their identities behind shell companies.
But No. 16B, which went into contract May 15, is a bit of an exception. Though it too was officially snapped up by a limited liability company, Crown NY 16B, that company’s sole member is spelled out on the deed as Apex Equity Ventures Co., a Bangkok, Thailand-based entity. And its director, according to the register, is Cattaliya Beevor, whose signature also appears on the filing.
For her part, Beevor seems to be a major investor in Thailand-based companies focused on renewable energy and other sectors. Among her investments is Green Tech Ventures, a Bangkok-based conglomerate whose holdings include utility companies and real estate across Southeast Asia as well as a cryptocurrency mining operation in Laos, according to the firm’s website.
Beevor is the largest individual shareholder in publicly-traded Green Tech Ventures, owning nearly 4% of the company’s stock, according to a regulatory filing from January.
Assisting Beevor with the Aman transaction was real estate attorney Steven Carlyle Cronig, a partner at Coral Gables, Florida-based firm Hinshaw & Culbertson, according to the deed. A phone message left for Cronig at his office was not returned by press time, and Beevor could not be independently reached.
Based on the condo’s offering plan, No. 16B has two bedrooms, two baths and a home office across about 3,700 square feet, though it does not have a terrace as some of the units do.
With its sale, only one sponsor unit, No. 25A, a four-bedroom with five baths and a home office, remains, according to the city register; the OKO Group has said that the unit is in contract. A $900 million sell-out for the building is expected.
The building has seen other kinds of sales activity. Earlier this summer an owner with links to several executives at Facebook parent Meta completed the first successful flip at the condo, when they resold No. 23A for $64 million a few months after shelling out $51 million for the four-bedroom unit, which resulted in a 25% haul.
The condo, which is located at West 57th Street inside the 25-story former Crown office building, also contains an 83-unit hotel that was considered New York’s priciest when it opened in summer 2022.
Hyatt Hotels agreed to buy Standard International, adding to its growing portfolio of lifestyle lodging brands in a deal that could be valued at as much as $335 million.
Hyatt will pay a base price of $150 million, getting brands including the Standard, Bunkhouse Hotels and Peri Hotels, according to a statement Tuesday. The acquisition, which doesn’t include any hotel real estate, encompasses 21 properties in places such as New York, London and Bangkok.
It also includes a pipeline of more than 30 new projects, with Hyatt agreeing to pay as much as an additional $185 million over time as those developments enter its system.
Bloomberg reported last month that Hyatt was nearing a deal for Standard. The transaction continues Hyatt Chief Executive Mark Hoplamazian’s shift toward an asset-light business model. The company has agreed to sell properties including the Hyatt Regency Orlando, while acquiring brands such as Alila and Dream Hotels, which appeal to leisure travelers.
Hoplamazian said Hyatt was drawn to Standard because its hotels function as social destinations, with thriving restaurants and nightlife scenes that appeal to vacationers, business travelers and real estate investors.
“We have very deliberately focused on this area because it’s where hotel development interest lies,” Hoplamazian said in an interview. “The equation works better when you have a vibrant food and beverage suite that supports the profitability of the hotel.”
Along with the new brand acquisition, Hyatt is creating a new lifestyle lodging group within the company, to be led by Amar Lalvani, executive chairman of Standard International.
Moelis & Co. served as financial adviser to Hyatt on the transaction.
The 2024 U.S. Open starts Monday, and the United States Tennis Association is looking to continue the momentum from last year's record-breaking attendance tournament.
Have tickets or want to attend in-person? Here are nine things to know before the first match, from new rules governing fan movement to Michelin-starred chefs making their tournament debuts to inflation hitting the iconic Honey Deuce cocktail.
When is the U.S. Open?
Qualifying play is already underway, as are the tournament's mostly free Fan Week activities. Official competition begins Monday, Aug. 26, with the finals concluding Sunday, Sept. 8.
Where is the U.S. Open?
The U.S. Open is played at the USTA Billie Jean King National Tennis Center in Flushing Meadows. It has been held there since 1978.
Are U.S. Open tickets sold out?
No, a small assortment of standard tickets listed from the USTA through Ticketmaster are still available starting at about $250. There are also swaths of verified resale tickets available for all matches through a variety of resale websites.
How much does a U.S. Open ticket cost?
As is typical, matches later in the tournament tend to be more expensive. Whereas fans can get ground admission to the first day for less than $200, nosebleed seats inside Arthur Ashe Stadium for the Men's Finals currently cost upward of $570. Thinking about splurging for court side tickets? Those are going for more like $15,000 to $20,000.
Who is competing in the U.S. Open?
The qualifying rounds are made up of 128 men and 128 women.
Favorites to make the women's finals include defending champion Cori "Coco" Gauff of the United States, Aryna Sabalenka of Belarus, Iga Swiatek of Poland, Elena Rybakina of Kazakhstan and Jessica Pegula, a Buffalo, N.Y. native.
On the men's side, the odds favor Carlos Alcaraz of Spain, Jannik Sinner of Italy, Novak Djokovic of Serbia, Alexander Zverev of Germany and Daniil Medvedev of Russia. Rafael Nadal of Spain announced earlier this month he will not compete in this year's tournament.
What are the new U.S. Open rules?
There are a few new rules at the U.S. Open this year. For starters, fans are no longer required to wait for a changeover to take their seats. Seat access will be available at all times in certain sections, while others will allow fans to move after each game.
Event organizers are also taking steps to address weather concerns after extreme heat hit New York during the tournament in 2023. This year, the roofs in both Arthur Ashe Stadium and Louis Armstrong Stadium will partially close to allow shade cover in the event of extreme heat.
The U.S. Open is also adopting an official late-match policy this year. It will be up to the discretion of the referee as to whether to begin certain matches after 11:15 p.m.
Is the U.S. Open good for Queens?
It depends who you ask. A two-week event bringing hundreds of thousands of visitors to the neighborhood is bound to drive economic activity. The U.S. Open actually pays the city directly to lease the space, which in recent years has totaled roughly $5 million. The U.S. Open also employed about 7,000 seasonal workers in 2022, most of them local, according to the New York Times.
But some local business owners have said the returns are minimal, and while the event does drive people to the park, fans do not necessarily venture far beyond the U.S. Open grounds.
What food is available at the U.S. Open?
Hospitality partner Levy Restaurants is once again in charge of food and beverage operations at the U.S. Open, and all restaurants being represented are saud it have ties to the New York area.
New this year are offerings from Simon Kim, the restaurateur behind Michelin-starred COTE Korean Steakhouse and Coqodaq, both in the Flatiron District. Award winning chefs Alex Guarnaschelli, Ed Brown, Masaharu Morimoto and Kwame Onwuach are also all returning.
Dozens of other familiar food names will be present at the tournament. According to a recent announcement from event organizers, the lineup includes "new dishes and returning favorites from Pat LaFrieda Meat, Champions by Benjamin’s Steakhouse, San Matteo NYC, Dos Toros Taqueria, La Casa de Masa, Red Hook Lobster Pound, Fuku, Eataly, Crown Shy, Korilla BBQ and Poke Yachty, Hill Country BBQ, King Souvlaki, Stacked Sandwich Shop, The Migrant Kitchen, The Nourish Spot, Van Leeuwen Ice Cream, the Dobel Tequila Club, and more.
So how much is a Honey Deuce cocktail?
The U.S. Open’s signature cocktail, the Honey Deuce — a mixture of vodka, lemonade, chambord and melons that look like tennis balls — is returning this year, but the already infamously expensive drink is getting even costlier. Honey Deuces will set fans back $23 this year, up from $22 during the last two tournaments.
Vendors reportedly sold 405,000 Honey Deuces, totaling $9 million in sales, in 2022.
Some New Jersey residents will see their medical debt eliminated using federal funds from the American Rescue Plan, Gov. Phil Murphy announced Tuesday.
The state will erase some or all medical debt of close to 50,000 New Jersey residents who together owe roughly $100 million to hospitals, collections agencies, and other entities, his office said. Murphy is partnering with Boston-based Undue Medical Debt, a national nonprofit focused on buying and forgiving medical debt, using $550,000 from the American Rescue Plan.
The move would eliminate debt for nearly 18,000 people owing $61.6 million to hospitals owned by Ontario, California-based Prime Healthcare, which has more than a dozen sites in the state. The state will also eliminate $38.4 million in debt for more than 31,000 residents who owe to collectors and other players in the secondary debt market.
A major rezoning that will allow more ambulatory care and life sciences research along a burgeoning corridor of commuter line stations in the East Bronx will benefit three hospitals.
Last week, the City Council passed a sweeping 46-block rezoning to encourage more housing and retail in a section of the borough that will soon be connected to a major transit artery. Hospitals in the area, which for years have comprised a medical campus in the center of a neighborhood of small homes and industrial uses, will be able to expand clinical offerings supported by four new MetroNorth stations and the influx of residents that are expected to follow the rezoning.
In total, the rezoning could support an estimated 7,000 new homes and 2.5 million square feet of commercial and community facility space, according to the Department of City Planning.
The three hospitals – Montefiore Hospital, Calvary Hospital and Health+Hospitals/Jacobi Medical Center – worked closely with the city on the rezoning provisions, according to Department of City Planning spokesman Casey Berkovitz.
The land-use changes could bring badly needed housing to the Morris Park section of the Bronx, which hospital administrators hope will help attract staff amid a sector-wide labor shortage. Morris Park, together with Hunts Point, is already one of the biggest job centers in the city, employing 37,000 people, according to the mayor’s office.
“We’re going to get the crème de la crème of the whole world,” said Ruben Diaz, Jr., Montefiore’s senior vice president for strategic initiatives and the former Bronx borough president, who lauded the changes.
Under the rezoning, Montefiore can consolidate its cancer center, currently divided into three buildings, into one facility at the southern end of the tract, according to Diaz. The new map also unlocks “several thousand” more square feet that the hospital can use on the north side of the campus, he said. Montefiore holds the lease on a garage near Jacobi Medical Center that can also be converted into residences, ideally for students and faculty of the Albert Einstein College of Medicine, Diaz said.
But Montefiore did not get the expanded density it needed to build a new high acuity surgery tower on the west side of the campus, he said. That section falls outside the 46-block tract and would require its own rezoning process, which could take months and would require new buy-in from local politicians.
“The reality is it still falls short of what we need,” said Diaz.
While plans to build a new tower are not final, the development could bolster Montefiore’s inpatient revenues, which account for more than half of what the system brought in for patient services in 2023, according to financial statements. That year, Montefiore reported $2.7 billion in inpatient revenues.
Health insurance company Anthem Blue Cross overpaid millions on health insurance claims for state retirees, racking up unnecessary charges on the state’s dime, a new audit shows.
Anthem paid $5.3 million on 241 health insurance claims for retirees that were supposed to be billed to the Medicare program first, according to an audit released by the state comptroller’s office Monday. The claims were paid through Anthem’s public health sector insurance plan for state and local government employees and retired workers.
The health insurer did not adequately update members’ Medicare enrollment information in its database nor match its member information with the state’s to ensure it was paying for the right claims, the audit found.
“The primary health insurance for more than 1 million public workers paid out more than $5 million on claims that should have been submitted to Medicare first for payment,” Comptroller Thomas DiNapoli said in a statement, calling for the insurer to make improvements to avoid improper billing and save the state money.
Leadership from Anthem has acknowledged that it overpaid $5 million on retiree health care claims and agreed to the comptroller’s recommendations to review and recover the overpayments, DiNapoli’s office said.
A representative from Anthem did not immediately return a request for comment Tuesday.
Anthem’s Empire Plan is the primary insurer for the New York State Health Insurance Program, which provides health insurance to 1.2 million retired and active state, local government and school district employees and their dependents, the comptroller’s office said.
The Empire Plan pays for hospital services, prescription drugs and other medical procedures, but many enrollees have additional forms of health insurance. Retirees who are over 65, for example, are required to enroll in Medicare as their primary insurer to cover most of their medical bills. The Empire Plan acts as secondary insurance and pays the remainder of health claims that Medicare doesn’t cover.
The health insurer paid roughly $526 million on 1.2 million health claims for members who had Medicare as their primary insurance during the audit period, according to the comptroller’s office.
Anthem is supposed to parse through all health claims and deny the one that Medicare should have paid first. But the insurance company either failed to identify faulty enrollment data in its system or detect claims that were supposed to be sent to Medicare first, the comptroller said.
DIGITAL THERAPY: An app designed by researchers at Weill Cornell Medicine to offer self-guided cognitive behavioral therapy was effective in decreasing anxiety among young adults, according to a study published in the academic journal JAMA Network Open on Tuesday. The app, called Maya, guides patients through videos, exercises and digital tools to help them cope with anxiety, offering an alternate solution to clinician-led therapy during a persistent mental health worker shortage. A group of 59 patients who used the app had lower levels of anxiety at six and 12 weeks, the study found.
ANTIBIOTICS GUIDANCE: New York City Health + Hospitals announced a partnership with the health tech platform Firstline on Tuesday to offer its clinicians guidance on how to appropriately prescribe antibiotics and reduce antimicrobial resistance. Many antibiotics are overprescribed, allowing bacteria and other microbes to become resistant to common treatments – a challenge that federal health authorities say is one of the greatest threats to public health. The new partnership, launching at Bellevue, Elmhurst, Lincoln, Queens and South Brooklyn Health hospitals, is designed to provide clinicians with information to treat and stop the spread of infections in health care settings. Firstline is providing its platform to H+H free of charge for the rest of this year, according to health system spokeswoman Stephanie Buhle.
MEDICAL DEVICE ACQUISITION: Pharmaceutical giant Johnson & Johnson said Tuesday that it will buy the cardiovascular medical device maker V-Wave for up to $1.7 billion. J&J plans to pay $600 million upfront for the company, with the potential to offer an additional $1.1 billion based on commercial and regulatory milestones. V-Wave, an Israeli company that develops implantable technology to target heart failure, will join J&J’s Medtech division.
CORRECTION: Yesterday's At a Glance has been updated to reflect the location of the new Center for Hospice and Palliative Care is Albany, not Gloversville.
Condé Nast has penned a multiyear agreement with OpenAI to license the magazine company’s content, the latest high-profile media deal for the artificial intelligence startup.
OpenAI, which makes ChatGPT and other AI tools, will display content from brands like Vogue, the New Yorker and Wired within its products, the company said Tuesday. The deal also allows OpenAI to use Condé Nast’s content to help train its AI models, which require vast amounts of data to learn.
The announcement marks an expansion of OpenAI’s efforts to cut deals with media companies, rather than battle them over how the company uses news articles and other content in its AI tools. Financial terms were not disclosed.
“It’s crucial that we meet audiences where they are and embrace new technologies while also ensuring proper attribution and compensation for use of our intellectual property,” wrote Condé Nast Chief Executive Roger Lynch in a memo to employees. “This is exactly what we have found with OpenAI.”
OpenAI has been “transparent and willing to productively work with publishers,” Lynch said, adding that the deal is “just the beginning” of the “fight for fair deals and partnerships across the industry.”
In the past year, OpenAI has made similar deals with Axel Springer, the Atlantic, and Vox Media, among others. Not every outlet, however, is working with with the company. In December, the New York Times sued the startup for allegedly using its copyrighted articles without permission to build its technology. OpenAI has disputed the claims, saying that the New York Times is not “telling the full story.”
As part of the deal with Condé Nast, OpenAI will also use the content in its upcoming SearchGPT product, a search-oriented version of its popular chatbot, which has yet to be widely released.
Brad Lightcap, the chief operating officer of OpenAI, said in a statement that the company is “committed to working with Condé Nast and other news publishers to ensure that as AI plays a larger role in news discovery and delivery” and that “it maintains accuracy, integrity, and respect for quality reporting.”
New York City is planning to sell apartments on the Upper West Side of Manhattan just two blocks from Central Park for as low as $173,801.
The 17 studio and one-bedroom units in the pre-war walk-up building come with hardwood floors and air conditioning, and will be sold via a lottery to New Yorkers making less than 120% of the area’s median income and who have no more than about $280,000 of assets. More than 10,000 people have already applied ahead of the Aug. 27 deadline.
The overwhelming demand underscores the city’s housing crisis, with the biggest shortage in over five decades amid sky-high rents and an influx of immigrants that’s filled city shelters. The raffles, run by the Department of Housing Preservation and Development, placed a record 9,550 households into affordable units in the past fiscal year. Mayor Eric Adams is also pushing to encourage more residential construction and recently used rezoning to pave the way for 7,000 new homes in the Bronx.
The Upper West Side building — on West 80th Street — is one block from both the American Museum of Natural History and gourmet market Zabar’s, and two blocks from the subway. It’s a few doors down from The Orleans, where a four-bedroom condo was recently priced at$7.8 million, while some cheaper options include a studio for nearly half a million dollars.
“It seems too good to be true,” said Ruth Miller, a retired head of a foundation who walked by the building to check it out recently. She wants her 31-year-old daughter - who moved back home as rents rose - to apply to the lottery. “This is almost what I bought my house for in 1991.”
The raffles, administered by NYC Housing Connect, allows those who meet income requirements to apply once per development.
For the building on West 80th Street, households of two people with a combined income of no more than $149,160 are eligible; three people earning no more than $167,760 could apply for a one-bedroom unit. The apartment must be the buyer’s primary residence, down payments of 5% are required, and there are restrictions on resales.
The price works out to as little as $340 per square foot, a bargain not only in Manhattan but also in cities like Austin, Texas, where a downtown two-bedroom is listed for about $446 per square foot or Santa Monica, California, where a one-bedroom is at $885 per square foot.
The city is also raffling homes in other tony neighborhoods like Hudson Yards, one of the most expensive in Manhattan, including more than 100 rental units in a 46-story tower at 550 10th Ave. that has 20,000 square feet of amenities like a sky lounge and a fitness club. Two-bedroom units are $3,861 a month for families of four earning no more than $194,125.
Buildings in Astoria and the Upper East Side are also participating.
Hospital supply chain software company Clarium, based in Midtown, raised $10.5 million in a funding round, the startup said Tuesday.
The round was led by venture capital firm General Catalyst, with backing from the venture arms of Oakland, California-based Kaiser Permanente and Houston-based Texas Medical Center. New Haven, Connecticut-based Yale New Haven Health also joined the round. Other investors included venture capital firms AlleyCorp, 1984 Ventures and Alumni Ventures.
Clarium has developed a software platform geared toward helping hospitals automate their supply chain operations. The software uses artificial intelligence to assist hospitals in managing inventory and determining whether facilities have clinically appropriate substitutes for certain medical supplies.
The funding takes Clarium’s total capital raised to $16 million.
The company started in May 2020, when supply chain shortages related to the Covid-19 pandemic were squeezing hospitals. Clarium Founder and CEO Steve Liou said he collaborated with several providers as he was building out its software platform.
"We were spending multiple days per week meeting with their chief supply chain officers and various direct reports designing and building this platform,” Liou said. “We wanted to build something that was designed and built for the supply chain by the supply chain [team] at hospitals.”
Clarium has also worked with multiple provider organizations to pilot the technology. At Yale New Haven Health, 300 individuals across seven departments use Clarium's software, vice president of supply chain Jacqueline Epright said in a news release.
Liou said he has seen a narrative shift among some health system executives who had previously been hesitant to invest in anything that could possibly improve supply chains.
“Historically, supply chain has been viewed as a cost center, but that’s changed because of COVID-19,” Liou said. “Executives are starting to realize supply chain is the lifeblood of their operations.”
Along with the funding round, Clarium is announcing availability of its AI-workflow based platform Astra OS. The technology combines data from a hospital’s various software programs — such as its electronic health record, revenue cycle management and enterprise resource planning systems — to help inform leaders of potential supply chain needs.
This article originally appeared in Modern Healthcare.
Former U.S. Rep. George Santos, who lied about working at Goldman Sachs Group and Citigroup while running for Congress, pleaded guilty to fraud charges over his personal use of campaign funds.
The Long Island Republican, once seen as a rising star in the party, appeared in court in Central Islip to plead guilty to federal wire fraud and identity theft charges. The federal charges stemmed from allegations that he used funds from his campaign to subsidize a lavish lifestyle.
“I understand my actions have betrayed the trust of my supporters and constituents,” Santos said at a hearing Monday, his voice wavering at times. “I deeply regret my conduct.”
Santos, who will be sentenced Feb. 7, had faced as long as 22 years behind bars after being charged with wire fraud, money laundering and theft of public funds. U.S. District Judge Joanna Seybert said that he faces a minimum of two years in jail on the identity theft charge, but as long as 87 months on both counts.
He also agreed to pay restitution of almost $374,000 and is subject to a forfeiture order of more than $205,000. The plea came just weeks before a trial that was scheduled to start next month.
Santos’ brief political career began to unwind following revelations that he’d lied about his resume and much of his life story when making his pitch to voters in New York’s 3rd district, a string of bedroom communities in Queens and Nassau County on Long Island that’s among the wealthiest districts in the U.S.
But it was his financial wrongdoing that brought legal peril. In a 23-count indictment, federal prosecutors said he solicited contributions to a shell company that operated as an illegal super-PAC, and stole the personal and financial information of contributors to his campaign. They also said he claimed unemployment benefits he was not entitled to and failed to properly disclose sources of income.
Lawyers for Santos, 36, are likely to seek leniency for the ex-lawmaker, pointing to his decision to admit guilt and spare the court from the time and expense of a trial.
Santos was expelled from Congress on Dec. 1 after the House Committee on Ethics found “substantial evidence” he broke the law. In February, Democrat Tom Suozzi won the race to succeed Santos, retaking a seat he previously held and narrowing the GOP’s razor-thin majority. Santos in March mused about a return to politics, a plan that’s now in doubt following his guilty plea.
Santos, the son of Brazilian immigrants, said he believed he could transcend what he called an “old White man’s party” and described himself as “the full embodiment of the American dream.” But his resume crumbled under scrutiny. He never graduated from Baruch College — or played on its championship volleyball team. His mother did not die in the 9/11 terrorist attack on the World Trade Center. And the Jewish identity he espoused on the campaign trail turned out to be, in his words, merely “Jew-ish.”
“From day one, we made the case that George Santos had no business serving in the House of Representatives and needed to be held accountable for his crimes,” Rep. Robert Garcia, a California Democrat, said in a statement.
A long-troubled Midtown office building with a bar on the ground floor is scheduled to be auctioned off Wednesday, according to a notice that appeared in court records this week.
Florida limited liability company LNR Partners — the special servicing arm of Miami-based Starwood Property Trust — foreclosed on 29 W. 35th St. two years ago after owners Shapour (Paul) Sohayegh and Roni Movahedian failed to pay back their mortgage loan by its due date, records show. Last month the court issued a judgment of $57.6 million, plus interest, and the 12-story building — with the multilevel bar and event space The Liberty NYC on the first floor — is set to be sold at auction Aug. 21, according to a New York state Supreme Court ruling.
Plaintiff LNR Partners first filed the complaint against Sohayegh and Movahedian — and their respective limited liability companies, American Equities and United Group, both headquartered in Manhattan — in January 2022 after the duo defaulted on their original $41 million loan from Wells Fargo Bank.
Trouble at the roughly 71,000-square-foot building, between Fifth and Sixth avenues, started long before then. Sohayegh and Movahedian first faced losing the same building in 2010 after defaulting on a $29.2 million mortgage but ultimately managed to stave off an auction and held onto the property, The Real Deal reported at the time.
This time around, however, Sohayegh and Movahedian's financial struggles were exacerbated because The Liberty NYC accumulated thousands in unpaid rent charges during the height of the Covid-19 pandemic, the outlet reported. The terms of the bar's lease agreement are unclear but a vacant 1,568-square-foot retail space on the ground floor of the same building is currently listed at $100 per square foot, according to Colliers.
An attorney for the defendants, Steven Schlesinger of Garden City-based law firm Jaspan Schlesinger Narendran, declined to comment. And attorney Scott Tross of New Jersey-based firm Herrick Feinstein, who is representing the plaintiff, also declined to comment.
A Manhattan developer seems to have big changes in mind for one of its office towers.
Williams Equities plans to tear down its 24-story office building at 655 Madison Ave., according to a recent filing with the Department of Buildings. The property, which Williams appears to own as a joint venture with international real estate firm Jamestown, spans about 200,000 square feet and stands 310 feet tall, the demolition permit filing says.
Williams is a roughly century-old New York developer with strong ties to the brokerage Colliers. Its future plans for 655 Madison Ave. are unclear, but Michael Cohen, who works as both a principal at Williams and as president of Colliers' New York tristate region, indicated in an April interview with the Commercial Observer that there were plans to tear down the building and turn it into something other than offices.
"We've emptied out a building in the Plaza District," he said. "SL Green had 625 Madison; ours is a stone's throw away at 655 Madison. We're going to see those buildings get torn down and replaced probably by a mixture of retail, hospitality and residential."
Representatives for Williams and Jamestown did not respond to requests for comment by press time.
The building at 655 Madison Ave. was constructed in 1951 and renovated in 2005, with estimated office rents ranging from $54 to $66 per square foot, according to commercial real estate database CoStar.
Williams is based right by Bryant Park on Sixth Avenue, and its portfolio consists of more than a dozen Manhattan properties. These include 28-40 W. 23rd St. in the Flatiron District, a landmarked building housing a Home Depot, where the developer recently landed a $155 million loan and is planning a $23 million renovation.
New York has been confronting a severe surplus of office space and a shortage of housing in the wake of the pandemic, and the state included a tax incentive for office-to-residential conversions in this year's budget that aims to make such conversions more financially feasible. Although the real estate community has largely embraced the program, some developers remain skeptical and view demolition as a more cost-effective option.
No matter what’s trending in fashion, the New York City uniform has remained constant — any cut, any style, but make it black. And the same has long been true of Manhattan hotels, with slick onyx, creamy white and neutral linens serving as reliable antidotes to the city’s sensory overload.
Not anymore.
“If you think about what the consumer wants today, they don’t want beige,” says Elizabeth Mullins, managing director of the Fifth Avenue Hotel and chief operating officer of its parent company, Flâneur Hospitality. “They want a hotel with soul.”
Mullins, a veteran of Ritz-Carlton and the Walt Disney, says this has been true ever since the pandemic left people wanting to reawaken their senses and “feel something” along their travels. Most commonly, they want to feel a sense of place. “But it’s hard to evoke much of anything when you’re beige.”
The good news is that with New York hotels suddenly awash in saturated hues, there’s no more room for a sleepy hotel stay. Here’s a look at the brightest, splashiest openings from Tribeca to Union Square and NoMad.
The Fifth Avenue Hotel
This former Gilded Age mansion on 28th Street and Fifth Avenue is a shockingly rare example of low-rise opulence smack in the middle of the NoMad neighborhood, just down the street from the Ned, Ace and Ritz-Carlton hotels. But this is less the preserved home of a turn-of-the-century tycoon and more of a fun-filled portal into Manhattan’s modern wonderland.
If you don’t like judging a book by its cover, don’t judge this hotel by its traditionally styled lobby, with its elegantly draped double-height windows and crystal chandeliers. But if you must, form your opinion from the contents of two vintage hutches against the back wall: The cheeky curiosities include a single goldfish cracker in a “plastic baggie” made from crystal.
That sense of humor is a through line for this kaleidoscopic hotel, fashioned with all sorts of winks and nods by the ever-whimsical designer Martin Brudnizki. In one hallway is a gallery wall of framed eyes — some painted, some drawn, some googly. Its 153 rooms feature martini carts piled high with full-size spirits and fresh-baked lemon cookies, all from chef Andrew Carmellini, who runs the excellent Café Carmellini restaurant downstairs. Mercury glass panels behind the headboards create a brilliant optical illusion: They reflect the twinkle of star-shaped ceiling lights, making each room feel twice its actual size.
Don’t miss a nightcap at the ground-floor Portrait Bar. Now that the Library Bar at the former NoMad hotel is a members-only space for the Ned, this is the neighborhood’s “it” spot for throwback glamor, complete with coffered ceilings and white-tuxedoed barkeeps. Rooms from $709; more information
The Warren Street Hotel
Designer Kit Kemp is the OG preacher of “anything but beige,” and her third New York City property for Firmdale Hotels is every bit as hypersaturated and pattern-happy as its predecessors, the Whitby and Crosby Street. The lobby can cure jet lag with its bursts of mustard yellow, kelly green and royal blue. Yet the double-paned, floor-to-ceiling windows in the rooms — with spectacular downtown vantages toward 1 World Trade or Herzog & de Meuron’s “Jenga building” — make for pin drop quiet sleep when you need it.
For fans of the U.K.-based brand (and there are many), the overall look will be familiar: dramatically oversize headboards and upholstered dress forms in mix-and-match patterns are Kemp’s indispensable signatures. The same is growing true about other design tropes she’s adapted here, such as long displays of white porcelain pots adorned with mushrooms and fairies in glowing, red-painted nooks, or the colorblock leather stools at the bar. If it’s slightly formulaic by now, there’s a reason for that: The effect is still mesmerizing.
But now, Kemp is adding her daughters’ stamps to the mix. The cheekiest rooms are the work of Minnie Kemp: They include throw pillows with a textile featuring strands of spaghetti threaded through the tines of a fork — a bright blue-and-yellow pattern with tiny red sauce splotches. Tossed against a zany floral headboard, it’s as bold as design statements get. In true Firmdale fashion, it works spectacularly. Rooms from $745; more information
Fouquet’s New York
Another Brudnizki special is this French-inflected 97-room gem on Greenwich Street, which has already earned two Michelin Keys and whose pink and green color palette was inspired by a dainty box of macarons. But that doesn’t mean the hotel is entirely demure. By one central staircase you’ll find a giant, bedazzled sculpture of a gorilla wearing a Team USA-inspired hat and holding the Eiffel Tower in its clenched fist. Custom toile wallpaper in the rooms sport New York street scenes interspersed with cheeky drawings of pigeons snatching croissants. (It’s a permanent installation by France-based contemporary sculptor Eddy Maniez.)
Thoughtful details abound, including green marble luggage benches built into little foyers. Ditto on the amenity side: The hotel has thought of all sorts of clever perks, such as a full cinema in the basement (with velvet chaise seats!) that can be used for kids’ movie screenings on rainy days.
Don’t miss a spritz on the frilly French rooftop space, Le Vaux, which is otherwise only accessible to locals who’ve joined Fouquet’s members club. And try to poke your head into the lobby speakeasy bar, which opens after 4 p.m. on days it’s not booked for private events. (Look between the gilded bookcases; the door looks like any of the other wooden wall panels at first glance.) Rooms from $900; more information
Virgin Hotel NoMad
The most eye-catching space at the Virgin Hotel is hidden away on the third floor, around the corner from a coffee bar feels almost as long as a football field. Do a little exploring, though, and you’ll wonder how Everdene restaurant has stayed a New York secret. The food is solid — mostly American classics with a twist, delicious if not exactly starworthy — but the space itself feels like a rarified haven. On one side, rainbow-like bookshelves dramatically arch from floor to ceiling, filled with tomes in bright corresponding colors; on the other are swooping blue banquettes that face walls of windows and two massive outdoor terraces. One floor up, in a separate oasis, is a rooftop pool decked out with black-and-white striped loungers, all with killer views of the Empire State Building.
That’s a lot of amenities for a hotel with shockingly well-priced rooms, though there are 460 of them — a big number by New York standards. Even the entry-level ones have separated, suite-like foyers, a brand standard designed to give solo female travelers extra privacy. (We love not having to say hi to room service staff while wearing a bathrobe.)
Also standard at all Virgin hotels are a handful of supersmart, space-saving design tricks. There’s always a very comfortable bed that includes a built-in cushion in one corner: You can sit against it if you want to work with your computer on your lap. In most rooms here the upholstered gray headboards stretch a few extra feet to one side, forming bench seating to go with a small round table — a functional dining space. Elsewhere, splashes of red abound; it’s the Richard Branson signature.
One more notable amenity: the Halo Salt Journey, which is a quick, 30-minute whirl in the Exhale spa’s Himalayan salt chamber. Staffers set you up with thigh-high Theragun compression boots and an LED face mask that stimulates collagen production while you recline in a zero-gravity chair; it’s a wellness boost that makes you feel like you’ve gone straight to outer space. Rooms from $305; more information
W Union Square
Nothing stays cool for 20 years, not even the original downtown New York location of the world’s first hip hotel brand. But as W’s devotees have grown older and more sophisticated, so, too, have its properties. Nowhere will that be more visible than at this fully redesigned global flagship, slated to wrap its four-year-long renovation in November after numerous lengthy delays. (The hotel has been open continuously throughout construction.)
“We’ve really moved from being this original lifestyle hospitality disrupter to being firmly rooted in the luxury lifestyle portfolio for Marriott,” says George Fleck, senior vice president and global brand leader for W Hotels. “But we don’t want to lose the playfulness and sense of style that we’ve been known for,” he says. “It’s an evolution, not a revolution.”
Part of that is simply shifting the colors to richer and more saturated tones, such as the forest green carpeting and orange leather headboards that stretch all the way to the ceiling in many of the hotel’s 256 rooms. Downstairs, a sizable gym with a Peloton “studio space” is done in minty green and yellow checkerboard tile; on the second floor, a Beaux Arts “Living Room” replete with ornamental plaster work gets a dose of fun from a mod, ochre-toned fireplace shaped like a giant rainbow (similar to the Virgin Hotel bookshelves). It’s refined and smart but with a cheeky edge — a little like New York itself. Rooms from $550; more information
Kathy Hochul, like New York Democratic governors before her, secured a speaking slot at the Democratic National Convention.
Hochul could use the boost; her poll numbers are middling at best and she has attracted scorn on both the left and right. While congestion pricing is broadly unpopular across the state, her decision to indefinitely pause the program infuriated transit advocates, city progressives and certain real estate and business interests. She still has not explained how she is going to close the budget gaps that congestion pricing revenue was supposed to fill.
But Hochul does differ from her immediate predecessors, especially Andrew Cuomo, in one particular way that may eventually buoy her political prospects: She’s a good Democrat. Congestion pricing was shut down, in part, because Hakeem Jeffries, the House minority leader, and national Democrats feared it would hurt their candidates in the suburban swing districts that might decide control of that chamber next year.
This does not mean scuttling the tolling scheme was good policy — it really wasn’t — but it does mean Hochul is the first governor in decades who cares earnestly about electing Democrats. Eliot Spitzer did, but he only lasted a year, with a prostitution scandal ending his governorship in 2008. Andrew and his father, Mario, served as governor of New York for a combined 23 years, and both were content to let the state Democratic party rot away.
Mario Cuomo today is remembered as a liberal icon for his own stirring speech at the 1984 convention. Hochul can’t reach those heights. But in New York, the elder Cuomo rarely campaigned to help Democrats in the state Senate break the GOP’s stranglehold on the majority. He did not aggressively fundraise for the party, either, and even hoarded campaign cash that could have gone to down-ballot candidates.
His son went much further, fundraising almost exclusively for his own campaigns while actively helping Republicans keep their majority. In 2012, after Democrats had won enough seats to secure a majority in the state Senate, Cuomo quietly encouraged a dissident faction of Democrats known as the Independent Democratic Conference to form a power-sharing agreement with the GOP.
The state Democratic Party withered further under Cuomo, serving as little more than a shell organization for his own gubernatorial campaigns. He spent little time, until running for his third term, stumping for legislative and congressional Democrats. In Albany, he oversaw a 2012 redistricting process that was designed to, at the very minimum, undercut Democrats who wanted favorable or even neutral lines drawn for their state legislative and congressional districts.
Hochul has taken a very different approach. She has hired full-time staff for the state party, including a communications director, data director and voter protection director. Since the start of 2023, she has pumped $5.5 million into the party, much of it dedicated to a campaign coordinated with Jeffries and Senator Kirsten Gillibrand to boost congressional candidates.
Direct mail and voter outreach are underway, and the state party has begun involving itself in less flashy local campaigns, like D.A.’s races in Columbia County and Dutchess County, and the flipping of the Binghamton City Council. The party has also distributed more than a half million dollars, overall, to local Democratic parties across the state.
None of this is groundbreaking, and all of it is done, to a much greater degree, in states like Wisconsin and Pennsylvania. While New York is not a swing state at the presidential level, 2022 revealed that the congressional majority will run through Long Island and the Hudson Valley. That alone makes New York far more important than a typical state that overwhelmingly votes Democratic.
Hochul, to her credit, understands this, and New York is getting a functional statewide party organization. If anything else, she can boast about this at the DNC. It’s been a long, strange road for Democrats in New York, and Hochul’s bid to rebuild the party infrastructure makes her much more like the other Democratic governors in America who want to see their party win. Cuomo-style triangulation has fallen out of style — perhaps for good.
Ross Barkan is a journalist and author in New York City.
The state Public Service Commission said it intends to review new analysis from Rep. Ritchie Torres finding that Con Edison charges users double for gas in the city compared to customers served by rival utility National Grid.
In a review of gas bills across the boroughs, Torres’ office said it found “egregious disparities” over the last two years in the service delivery rates charged by Con Edison compared to National Grid. Both utilities have similar supply costs — the price of buying energy from wholesale markets — but their fees for delivering the energy to customers can vary, according to the report released Sunday. State regulators said Monday they will review the report.
The report found that Con Edison, which serves Manhattan, the Bronx and part of Queens, charges between 92 cents and $1.29 per a thermal unit of gas. National Grid, meanwhile, charges its customers in Queens and Brooklyn between 45 cents and 54 cents per a thermal unit; the utility also serves Staten Island but the review did not include that borough.
Those rate differences can add up in a big way for property owners. For example, Con Edison charged one Bronx multi-unit property roughly $7,300 for about 3,800 thermal units of gas between September and October in 2023; as part of the fees, the delivery charge was more than $5,600, the report found. In Brooklyn, Torres' review found that National Grid charged a similar property using roughly the same amount of gas, some $2,800 for service between April and May 2023, and the delivery portion of the charge was just over $1,800.
“The status quo of arbitrarily higher delivery rates cannot be allowed to stand,” Torres wrote in a Friday letter to Public Service Commission Chair and CEO Rory Christian. He urged the commission to investigate.
Con Edison spokesman Allan Drury did not dispute the utility’s higher costs but noted that energy delivery rates can vary for several reasons. Those include the level of service provided to customers, the geography of an area and the timing of annual state-approved rate hikes. Drury also pointed to Con Edison’s investments in local gas infrastructure.
There isn’t a one-size-fits all formula for costs across utilities, said James Den, a spokesman for the state’s Department of Public Service, which includes the Public Service Commission. He pointed to a mix of factors such as differences in utility operations, the number of energy plants in use, property taxes and corporate structures that can factor into the cost differences.
National Grid customers across New York City, in fact, will soon face higher gas bills. As of Sept. 1, customers who use the utility’s gas to heat their properties will, on average, see an extra $30 charged to their monthly bills in Brooklyn, parts of Queens and Staten Island. State regulators approved the rate hike last week largely to pay for $5 billion in new investments National Grid intends to make into New York’s gas system.
Gary Jenkins, a former social services commissioner under Mayor Eric Adams, is leaving his job at a consulting firm run by a top mayoral ally to work for a major homeless services nonprofit.
Jenkins is joining Urban Pathways as its inaugural chief administrative officer, the group announced Monday. Since leaving city government last year following a rocky tenure at the Department of Social Services, Jenkins had worked at Oaktree Solutions, the lobbying and consulting firm run by former Adams chief of staff Frank Carone and his brother, Anthony.
Jenkins had just been promoted to chief administrative officer at Oaktree in April. In an email sent to Oaktree employees last week that was viewed by Crain’s, Anthony Carone said Jenkins was leaving “for an incredible opportunity to help lead an important local non-profit” and called his departure “bittersweet.”
Urban Pathways controls 19 city contracts worth $222 million in the current fiscal year — many of which were assigned by the Department of Homeless Services, a subsidiary of the Social Services department that Jenkins formerly led. The nonprofit operates shelters and supportive housing, and conducts street outreach.
A veteran government official, Jenkins served as Adams’ inaugural social services commissioner for one year until he resigned in March 2023. He stepped down amid controversy over his handling of the early months of the migrant crisis, including a claim from a top aide that he had tried to cover up a violation of the city’s right-to-shelter policy.
The Department of Investigation, which launched a probe at the time the allegations surfaced, concluded in a report released this year that Jenkins had broken city policy by waiting a full day to disclose that families with children had been forced to sleep on the floors of an intake center. The report also faulted Jenkins for being less than transparent in his initial talks with City Hall officials including his supervisor, Deputy Mayor Anne Williams-Isom, who told investigators she was “frustrated that Jenkins did not provide additional context” about the violations.
Jenkins’ last day at Oaktree will be Aug. 23, and he starts at Urban Pathways on Sept. 9. He will oversee the nonprofit’s internal operations, and Urban Pathways credited him in its announcement for previously overseeing a $12 billion, 14,000-person department at DSS.
His move is the latest example of the often porous border between city government and the nonprofit sector — especially in social services. Jenkins’ successor at DSS, Molly Wasow Park, previously led a different nonprofit housing provider before joining government.
"Urban Pathways has a long-standing reputation for delivering critical services to those experiencing homelessness, and I look forward to contributing to the organization's mission,” Jenkins said in a statement.
When he resigned from DSS, Jenkins insisted that there was “no discord, no running away,” adding that his yet-to-be-reported hiring at Oaktree had already been planned. He later defended his choice to work for the lobbying-and-consulting firm, telling an interviewer that “I don't think it looks bad at all.”
Frank Carone, for his part, has attracted considerable scrutiny for appearing to trade on his connections in city government despite opting not to register as a lobbyist after he founded Oaktree in early 2023 — just weeks after his departure from City Hall. Carone has hired away several former Adams administration officials — most recently Small Business Services Commissioner Kevin Kim, who was named this month as Oaktree’s managing director of international ventures.
The company’s clients this year have included teletherapy company Talkspace, several real estate developers, and nonprofits including Housing Works and the Brooklyn arts group BRIC.
Yeshiva University is expanding both its physical footprint in the city and its presence in the medical field with a new health sciences center in Herald Square, the higher-education institution announced Monday.
The private Orthodox Jewish university inked a long-term lease across 160,000 square feet in the 10-story Herald Center building at 1 Herald Square, or 1293 Broadway. The university intends to develop the space over the next several years in order to "align with our strategic academic priorities," said Patrick Gallagher, vice president of administrative services. It was not clear as of press time what those priorities include or what facilities would be housed in the new space.
The 32-year lease for floors five through nine, as well as a portion of the mezzanine and the ground floor, puts the building at 100% occupancy. Built in 1902 as the original Saks flagship at the corner of 34th Street and Broadway, Yeshiva University's newest campus will join the Midtown retail center's other tenants, including H&M, Verizon and a Bank of America.
JEMB Realty, the development firm headquartered in the Financial District that acquired the property in 1981, declined to provide the Herald Center's full list of tenants. The now-defunct for-profit ASA College previously occupied the space now leased by Yeshiva University, whose main campus is located in Washington Heights. A representative for the more-than-a-century-old institution did not respond to a request for comment about a name for its forthcoming health sciences campus, when it's slated to open or how much the university is paying per square foot.
The new health sciences center will join the university's four other campuses across the city, including its undergraduate schools Yeshiva College, Stern College for Women, Sy Syms School of Business and the Katz School of Science and Health — where a new nursing program is starting in the fall. Yeshiva University works to educate the country's next generation of doctors — its medical school affiliate, the Albert Einstein College of Medicine, was founded under the leadership of former Yeshiva President Samuel Beklin before ownership was transferred to the Montefiore Health System and it became an independent institution in 2019.
Rabbi Dr. Ari Berman, the university's current president, said the new campus will help the university "make a significant impact in the world."
Broker David Carlos, vice chairman of JLL's nonprofit practice group, led the negotiations on behalf of Yeshiva with Savills. JEMB was represented in-house by Morris I. Bailey and Jacob Jerome, according to information from the university.
A landlord with deep ties to the rental housing market could soon have one less property.
Lionstone Capital, a family-owned, Brooklyn-based company, faces foreclosure at 104 Audubon Ave., a 48-unit mixed-use property at West 171st Street in the Washington Heights enclave of Manhattan. Flagstar Bank claims in a new lawsuit that Lionstone is months behind on payments on an $8 million loan, some of which personally guaranteed by company executives.
Founded in 1973 by Leibel Lederman and managed in part today by principals with the same last name, David Lederman and Motti Lederman, Lionstone has failed to make mortgage payments since February, according to a complaint filed Monday in Manhattan Supreme Court.
Midwood-based Lionstone, which also does business as Galil Management (the two entities share an office), bought the 6-story prewar building in 2015 for $11.6 million and borrowed $8 million against the walk-up site the same year from New York Community Bank, according to the city register. Flagstar merged with the Long Island-based NYCB in 2022 and the next year acquired the failed Signature Bank.
Lionstone must fork over $7.2 million plus interest and fees, or prepare to surrender the site, the suit adds.
The firm, which has three weeks to file an answer, has not yet responded to the suit. And a phone message left for company principal Scott Katz, whose name appears on legal documents for the building, which also uses the address 550 W. 171st St., was not returned by press time.
The building, which also contains 7,000 square feet of retail spaces occupied by a pizzeria, a hair salon and other modest businesses, appears to contain at least some rent-regulated apartments, based on state housing records. Some investors in multifamily sites have seen business plans stymied by the 2019 pro-tenant rent-reform laws, which limited the kinds of rent increases landlords can obtain.
The city-determined market value of the property for 2025 is $3.2 million, up from $3.1 million for 2024 but below its recent peak of $3.7 million in 2021, tax records show.
Apartments at 104 Audubon, which seem to have been renovated by Lionstone since it purchased the property, have been offered in recent years at market-rate rents. The latest to lease, according to StreetEasy, was in 2022, when a three-bedroom listed for $2,500 a month found a taker.
In the 1970s and 1980s, Lionstone owned more than 65 apartment buildings representing 4,000 units in Brooklyn, the Bronx and Manhattan. Today, the firm has a portfolio of 10,000 apartments, according to Galil’s website, which says the company’s “ability to identify opportunities in virtually all market conditions has enabled it to prosper — throughout the booms and the busts.” The landlord also owns office buildings across the region.
Craig Steinfeld, Flagstar's lawyer in the case, did not return a call for comment.
Leases
Speakeasy opening West Village location
Address: 162 W. Fourth St., Manhattan
Landlord: SW Management
Tenant: Please Don't Tell
Lease size: 6,000 square feet
Lease length: 15 years
Asset type: Retail
Brokers: Murro Realty's Jarrett Sharp and Gage Sharp represented the tenant and the landlord.
Yeshiva University to open new health sciences center in Herald Square
Address: 1293 Broadway, Manhattan
Landlord: JEMB Realty
Tenant: Yeshiva University
Lease size: 160,000 square feet
Lease length: 32 years
Asset type: Retail
Brokers: JLL's David Carlos and Savills represented Yeshiva University. Morris I. Bailey and Jacob Jerome represented JEMB in-house.
Read more about the deal here.
Sales
Developer snaps up former retail site by Bronx Zoo
Address: 2111 White Plains Road, Bronx
Seller: Barbara Sopher
Buyer: Robert Lumaj
Sale price: $7.9 million
Asset type: Land
Estée Lauder Chief Executive Fabrizio Freda plans to retire at the end of June 2025, capping a decade-and-a-half reign that transformed the company into a global cosmetics giant but ran into trouble in recent years.
Freda, 66, will continue to lead the company until a successor is named, the company said in a statement on Monday. It said it is “well advanced” in the search for a new CEO and has considered several internal and external candidates.
Separately, the company on Monday forecast annual revenue growth that dramatically missed analysts’ expectations in a sign that Freda’s turnaround pledge isn’t materializing as quickly as investors had hoped. The company has repeatedly cut forecasts during the past year, giving the impression at times that executives don’t have a solid grasp on the dynamics shaping their business.
Estée Lauder expects revenue in its current fiscal year in a range between a 1% decrease to a 2% increase. Analysts surveyed by Bloomberg were forecasting a 5.6% increase to $16.5 billion. The company also sees adjusted earnings of $2.78 to $2.98 per share for the fiscal year, below the average analyst estimate of $3.97.
Shares fell as much as 8% in premarket trading in New York on the poor earnings results but have pared losses. The company’s stock was down 35% so far this year as of Friday’s close, compared to a 16% rise in the S&P 500 Index.
The results are the latest blow to Freda’s long-time plan to turn China into an engine of growth for the company. But in the past couple of years, Estée Lauder’s sales at duty-free shops in the country have imploded and demand across Chinese cities has been weaker than executives anticipated.
The company blamed the forecast on “persistent weak sentiment among Chinese consumers.”
“While our sales and profit outlook for fiscal 2025 is disappointing, this year we will make important strides, as we implement our strategy reset,” Freda said in the earnings statement.
Wall Street darling
Freda, who has been in the post since 2009, was instrumental in growing Estée Lauder into a cosmetics giant that sells brands including Clinique, the Ordinary, La Mer and Jo Malone across the globe. That growth in the years before the pandemic made Estée Lauder a Wall Street darling and helped members of the founding Lauder family billionaires. Freda is one of two CEOs to lead the company outside of the Lauder family. Shares have risen 467% during his long tenure, tracking just under the performance of the S&P 500 during that time.
But the company has stumbled since the pandemic, putting pressure on Freda to restore the cosmetics giant to its former glory. Estée Lauder’s business at duty-free shops in Asia, particularly China, imploded and has been slow to recover amid sluggish travel and poor planning by the company. It hasn’t been as agile as some startup competitors either, failing to seize on social media beauty trends and ceding market share.
Those challenges had raised questions about how much longer Freda would remain at the company.
In February, Freda told Bloomberg News in an interview “I’m not going anywhere” and that he was committed to the company. Estée Lauder announced at the time that it would cut as many as 3,000 positions as part of a restructuring plan.
Freda will continue to implement that plan during the next year and will be available as an adviser the year after he steps down, the company said. The plan will “position us to both outperform prestige beauty in fiscal 2026 and accelerate profitability expansion,” Freda pledged on Monday.
His exit is part of a changing of the guard at Estée Lauder following the financial turmoil at the company. Longtime Chief Financial Officer Tracey Travis is also stepping down on June 30, 2025, after more than 12 years in the role, the company said last month.
Another new building is poised to add to the residential boom in Mott Haven.
Developer Arian Liton recently filed plans with the Department of Buildings for a project at 36 Bruckner Blvd. in the trendy South Bronx neighborhood. The development would stand 104 feet and 10 stories tall with 99 residential units, along with retail and community facility space on the ground floor. It would span about 81,000 square feet overall and include 20 parking spots, according to the filing.
Liton, who could not be reached for comment by press time, filed demolition permits for the 2-story, 29-foot industrial building on the site earlier in August, according to city records. The property was built in 1945 and spans 25,000 square feet, according to commercial real estate database CoStar. It is currently vacant but appears to have once been home to a company specializing in building restoration services, according to CoStar.
Mott Haven, located near Manhattan just over the Harlem River, has long been viewed as a potential hotspot for new developments. The neighborhood has seen a major influx of residential buildings in recent years, including from major developers including RXR and Brookfield, which is behind the sprawling Bankside luxury apartment complex on the neighborhood's waterfront. Heritage Equity Partners, a developer behind several high-profile Brooklyn projects, was planning a 105-unit development at 286 Rider Ave. in the neighborhood as well but sold the site for $15 million in May to a limited liability company linked to Rubin Equities.
The MTA suspended service on the Waterbury and Danbury lines late Sunday night at least through the Monday morning commute after severe flooding.
Floodwaters inundated both lines and caused a mudslide on the Waterbury Branch, forcing the MTA to temporarily suspend service on the route, transit officials said.
Metro-North crews are assessing damage and working to clear the area.
As an alternative route into the city, customers may consider traveling to their nearest station on the New Haven or Harlem lines. Some New Haven line trains will make additional stops at Rowayton, Darien and Norton Heights.
Merger and acquisition (M&A) activity in fintech picked up during the last two quarters of 2024—and that is posing both opportunities and risks, as a panel of specialists from Crowe LLP, a public accounting, consulting, and technology firm, unpacked in “Fintech Trends in M&A, AI, and Income Tax,” held on July 30 as part of the firm’s fintech webinar series. The webinar looked at three key areas—M&A trends, governance of artificial intelligence (AI) and developments in income tax—all key focus areas for fintech companies that are getting ready for the next stage of their evolution.
Although $9 billion was raised in Q2 globally – a 20% increase – funding would have been flat with late-stage large deals eliminated, as Kevin Brand, Consulting Partner at Crowe noted. In the U.S., the picture was similar, with total funding up 45%, but that figure, otherwise flat, was inflated by two late-stage deals. Meanwhile, there was a 50% decline in deal volume in Q2.
These developments leave funding below where it was two years ago, which is an indicator that fintech investors remain cautious, according to Brand. Fintech M&A peaked in early 2022 and dropped in 2023, and it has begun to pick up slowly the past two quarters, he pointed out—portending opportunity. “Since then, deals have picked up more than the rest of the world with about 5-10% quarterly growth here in 2024 the past couple of quarters,” said Brand.
One bright spot is mid- to late-stage deal share. “With more favorable operating environments as they look forward, investors are showing greater competence in some of those later stages," said Brand. "This is particularly true areas like payments and lending where mid- and late-stage rounds made up an even higher percentage, around 30-35% of deals thus far in 2024.”
There was also a bit of a pickup in WealthTech—a group of fintech companies bringing digital solutions to the wealth and asset management industries—and more money poured into deals in InsureTech—made up of firms that bring efficiencies to current insurance industry operations—though the deal flow was lower, according to Brand.
Fintech funding trends: Tapping the opportunities
In this environment, competition for deals is robust, and it is important to stay on top of critical risk and regulatory, financial, and strategic aspects, said Brand.
Successful M&A starts early with strategy, planning, discipline, due diligence, and overall preparedness, and it continues after the deal closes, to make sure entities get what they anticipated from the deal, he said. “Beyond the financial considerations with fintech, it's also critical to navigate the risks and manage evolving market conditions or regulations and the competitive landscape overall, with the focus on value creation, not just value protection from a risk management perspective,” he said.
Also, both entities must prioritize cultural alignment between the companies in the deal, advised Clayton Mitchell, Managing Principal of Fintech at Crowe. “Make sure that the North Star of these organizations is aligned and the way that they go about and execute their business is aligned as well,” said Mitchell.
Stay clear on what you are buying or selling – whether it is a different distribution channel, a novel product, a piece of technology, or a firm’s talent pool – "so that the outcome starts to take shape and allows you to meet that end goal without trying to fit a square peg into a round hole,” Mitchell said.
Using due diligence to mitigate risks
Due diligence is critical on both the buy and sell sides, as the panelists pointed out. On the buy side, whether for M&A or funding, it's important to focus not just on the quality of earnings or financial diligence, but also on regulatory credit, risks, and compliance, noted Brand.
On the sell side, revenue should convert to cash, he noted. Also, the firm's accounting and reporting structure should allow for accurate financials. “Is it built to produce reliable and timely financial information on the current and expected future stage of the company?” asked Brand.
Compliance with consumer laws, regulations, and licensing is also essential, noted Mitchell. To avoid investing in vaporware, he advised, “Make sure that you see technology working and working in a meaningful way.”
Mastering AI governance
With generative AI such as ChatGPT sparking a lot of buzz, David Moncure, Consulting Principal at Crowe, suggested companies consider risk assessments, creating cross-functional working groups to evaluate their use of AI, and building inventories of data used in any AI tools – and cleaning it up. With the regulatory conversation just starting and no defined best practices yet, “It’s an opportunity to clean house,” he said.
Understanding acceptable use, key controls, safeguards, and accountability is essential, according to Mitchell. “We as a firm look at AI governance as the brakes on a race car, and the brakes on a race car are not meant to make it go slower. They’re to enable it to go fast,” said Mitchell.
Having internal auditors do readiness and maturity assessments in a consultative manner can help bring an organization up to speed, he said. It’s important to stick with a regulatory framework, such as the EU AI Act or NIST Cybersecurity Framework, and embrace transparency, notice and consent, execution, and documentation to support AI use cases and provide ongoing training, he said. "That's something that's expected on an ongoing basis: making sure we know what and whose data is being used, what actions and decisions are being taken on that data, and who is making those decisions.” he said.
Bringing income tax expertise to fintech
AS-2023-09 provided some clarity on income tax disclosures and issuing financial statements, noted Cody Lewis, Tax Partner at Crowe. For public business entities (“PBEs”), it applies to annual periods beginning after Dec. 15, 2024, and for non-PBEs, for annual periods beginning after December 15, 2025. It requires disclosure in separate categories of state and local income tax, foreign tax effects, and the effects of foreign tax laws in the rate reconciliation, he said. The big change is that if one item rises to a new threshold, 5% of the amount computed by multiplying pre-tax income times the applicable statutory rate (21% for most US companies), firms must break that out separately.
Also, organizations should consider whether they need a valuation allowance – a GAAP reserve against deferred tax assets – which can be an expense to the profit and loss statement, he added. That is a complicated assessment that requires entities to consider both positive and negative evidence in favor of either position, he said. "It requires significant judgment and often subjectivity," he said. That's true in many areas of M&A, and it’s an area in which the right professional advisers can bring clarity and confidence.
It’s imperative for fintechs to understand how to prepare for the trends in M&A, AI and income tax that are shaping the industry. Crowe can help companies uncover opportunities in the current market and to make the most of a rapidly changing business environment. For more information, see www.crowe.com/fintech/.
Learn more about how Crowe works with fintechs in a variety of ways, including financial statement audits, consulting, technical accounting, tax consulting, and M&A activities. Visit crowe.com/fintech to explore our services.**
A wealthy client at Bank of America put up his fine-art collection so he could borrow enough to buy a sports franchise. Another posted his cache of 19th century American landscapes to renovate his estate.
Such is the burgeoning world of art lending — where pieces are used to secure loans, allowing their affluent owners to tap their collections for cash without having to part with prized possessions. Art sales have slowed, forcing many to reevaluate their options. The major May New York auction season fell about 23% by value from the prior year, with the world’s richest waiting on the sidelines to buy.
“If you’re an owner and need liquidity now, you pause on selling, and instead borrow against your art, waiting for better market conditions,” said Adriano Picinati di Torcello, global art and finance coordinator for Deloitte. That’s contributing to the growth of the art-lending market, he said.
As the market expands, Wall Street’s biggest firms are growing their efforts by adding staff and marketing the service to new and existing clients. While the precise size of the market isn’t certain, Deloitte estimates outstanding loans against art could surpass $36 billion in 2024, up from $29 billion to $34 billion last year. That also compares with $20.3 billion to $23.6 billion of such loans outstanding five years ago, according to Deloitte.
The largest banks are looking to broaden their reach into the art market as a way to bring on and retain some of the world’s wealthiest individuals and families. Catering to the affluent often means competing with rivals to offer more diverse products, fighting the constant threat that clients can move their money elsewhere.
Art lending offers specific advantages for wealthy owners evaluating their investments as broader financial markets face volatility. Unlike stocks, art isn’t subject to daily swings and is valued annually.
“We’re not asking what the value of your Andy Warhol is every day,” said Katy Lingle, U.S. head of lending solutions at JPMorgan Chase Private Bank.
The global art market has cooled from record-high valuations coming out of the pandemic. Even as sales have slumped and values have pulled back, demand for art loans is there.
Bank of America has seen new credit lines backed by art rise more than 14% compared to a year ago, according to Drew Watson, head of art services. Its book of art loans recently hit its highest on record. Within JPMorgan’s asset and wealth management business, art lending is up 1% year-over-year, in-line with other loans in that business, according to a spokesperson.
“Even in a higher rate environment, people are still taking advantage of timely opportunities,” taking out loans on their art over selling it at a discount, or selling stock, Watson said.
Bank of America, since it formed its art services group in 2017, has grown to capture over 30% market share, according to a spokesperson. The team, which the bank is continuing to invest in, has 12 specialists in the art market across credit, wealth planning and philanthropy. The bank’s clients that already have loans keep them, while utilization has remained around 70% this year, according to Watson.
“The retention and strong utilization is reflected in the balances outstanding, which have remained strong,” he said.
Bank of America structures these loans on a variable rate, so over time the cost of capital could decrease if rates fall. The interest rate is based on the secured overnight financing rate, plus a spread, Watson said. So as rates get cut, loans like this are even more likely to increase.
Citigroup, which estimates its share of the market at 10% to 15%, has a steady base of art-lending clients because rates on art loans are still favorable compared to other loans, according to Fotini Xydas, head of art finance at Citi Private Bank.
“Even though rates are higher, art is a very stable asset over the long term, compared to other assets in terms of volatility,” she said.
Art loans function as lines of credit, so clients draw on them and pay them back as they can. They’re only available to the wealthy, given the nature of the collateral. The larger the collection, the more flexibility there is for the borrowers.
To qualify at Bank of America and Citigroup, a collection usually needs to be worth at least $10 million, which secures a loan of $5 million or more. Bank of America typically offers 50% loan to value, with each piece worth a minimum of around $100,000. The terms run from around one to three years, with an option to renew, and clients can still keep their pieces protected at home as long as it is within the U.S. Citigroup looks for a minimum value of $200,000 per piece.
JPMorgan bases its loan sizes on the value of the collection and strength of the borrower. The bank looks for diversity of pieces, ensuring they are of “museum quality,” Lingle said. It also does a financial analysis on borrowers to make sure they can service the debt.
One Citigroup client who had collected several pieces from Pablo Picasso and Claude Monet used them to secure a line of credit to cover taxes tied to estate planning, another common use of this product.
Another private equity principal wanted a line of credit to help fund a capital call. Bank of America facilitated a $10 million loan for one borrower worried about market volatility, using his collection of post-war and contemporary art as collateral.
“There are margin calls, death, divorce and bankruptcy, so we have endless interest for lending,” said Philip Hoffman, the founder of The Fine Art Group, an art advisory and finance specialist that competes with the banks.
BETH ISRAEL UPDATE: A New York state judge reinstated a temporary restraining order blocking Beth Israel’s closure on Friday after advocates filed a last-ditch lawsuit aiming to keep the hospital open.
The original lawsuit, filed in February, was tossed because it did not account for the Department of Health’s conditional approval for Mount Sinai’s plan to shutter the financially ailing hospital, which came in July. New York Supreme Court Justice Jeffrey Pearlman sided with the coalition of advocates and community members who argue that the closure of Beth Israel will cause irreparable harm to the downtown community.
Mount Sinai argued in its case that it is financially impossible to keep the hospital, which loses $18 million per month, open, noting that its bond rating has been reduced while it tries to keep the facility open.
As such, the judge scheduled an expedited resolution for the case; a follow-up conference is set for Aug. 26. Until then, the hospital must remain open.
LYMPHOMA GRANT: Researchers from Weill Cornell Medicine received a $12 million grant from the National Cancer Institute to study the causes and biology of the most common form of lymphoma. The five-year grant, announced by Weill Cornell last week, will fund a study investigating what causes and sustains diffuse large B-cell lymphoma, a disease that presents challenges for cancer biologists because 40% of patients either don’t respond well to treatment or relapse. The new study will aim to uncover more complex biological processes that drive the disease and lay the foundation to develop more effective treatments in the future, Weill Cornell said.
IPRO LAYOFFS: Nassau County-based health care consulting firm Island Peer Review Organization sent notices of impending layoffs to 101 employees this week as a number of state and federal contracts are set to expire. The company, which holds contracts with state and local governments around the country, previously sent notices to 25 employees in July. Two state contracts, affecting 7 employees, and three federal contracts, affecting 30 more, will expire in the coming weeks, according to spokeswoman Theresa Jacobellis. The company is seeking to renew the contracts and the layoffs are “unlikely” if they are, she said. Another 66 support staffers who are not involved in those contracts also received notices “out of an abundance of caution.”
Flatiron-based health technology company Levels raised $10 million in a Series A extension bringing the total Series A to $52 million as part of an effort to expand the market for its continuous glucose monitor.
The company is one of a growing number of health tech start-ups seeking a foothold in the field of wearable biometric readers. Its latest fundraising round doubled investment in the company and brought its pre-money valuation to $265 million, according to the research firm Pitchbook.
Twenty-six investors participated in the latest round, including venture capital giant Menlo Park-based Andreessen Horowitz, which has backed successful startups like OpenAI, Groupon, and Pintrest. Other investors included Menlo Park-based TriplePoint Private Venture Credit BDC, Soho-based Founder Collective and Murray Hill-based Alumni Ventures.
The company is hoping to expand the reach of its main product, an under-the-skin glucose monitor and phone app, beyond its 25,000 current customers and tap into international markets, according to Pitchbook. The monitor is a plastic disc worn on the upper arm that delivers blood glucose readings to the app every five minutes via a subcutaneous sensor.
Levels’ website says the product can improve glucose readings for people with Type 1 or 2 diabetes because it provides ongoing real time data, allowing users to better understand the impact of diet and lifestyle on their metabolism. Traditional devices like glucometers measure blood sugar levels far less frequently, only after the user provides a blood sample. The company also advertises the product to people who are prediabetic and to the general population interested in keeping tabs on their blood sugar.
Levels is not the only company seeking to break into the wearable health market. In April, San Diego-based Biolinq announced it raised $58 million to complete clinical trials on its wearable glucose sensor and submit it to the FDA.
But the new tech isn’t all roses. A cottage industry of tech companies selling questionable biometric sensors has emerged prompting the FDA to warn consumers against using wearable blood sugar monitors that do not break the skin, like smartwatches and rings. Perhaps the biggest wearable biometric company, Apple, got into hot water earlier this after losing a patent suit over its blood-oxygen reader. The decision forced Apple to remove the technology from its watches.
Since it was founded in 2019, Levels has raised $104 million, including a $7.9 million crowdfunding round in April.
Memorial Sloan Kettering began warning patients insured by Anthem Blue Cross Blue Shield last week that they may no longer have access to in-network cancer care if the organizations don’t resolve a payment battle by early next year.
The Upper East Side cancer center has been negotiating with Anthem since 2022 to raise its reimbursement rates, according to Rebecca Williams, a spokeswoman for Memorial Sloan Kettering.
Memorial Sloan Kettering has maintained that it gets reimbursed at rates “far below its peers,” despite being one of the leading cancer centers in the nation. But the insurer has accused the requested pay rate increases of being far too steep; Memorial Sloan Kettering has requested a three-year contract that would increase the price it charges Anthem members “by more than four times the inflation rate each year,” said Kersha Cartwright, a spokeswoman for Anthem.
Anthem said that in one example, a mastectomy would cost $23,800 more in 2027 than it costs now.
Despite months of negotiations, the organizations have yet to reach an agreement. The existing contract does not expire until the end of this year, but the hospital sent warning letters to patients last Monday to inform them of the potential change so they can explore other insurance options, Williams said.
The negotiations represent the latest pricing battle between a city hospital and an insurance company that has played out in public. Such negotiations have disrupted care for patients, many of whom are left confused about whether they need to swap providers to maintain access to necessary treatments.
Patients enrolled in Anthem plans will no longer receive in-network pricing at Memorial Sloan Kettering if the organizations don’t agree on a new contract before Jan. 1. But state law requires health systems and insurance companies to continue offering in-network access two months after a contract ends, which could potentially extend patients’ coverage through March 1.
Roughly 21,000 active patients could be affected, according to Williams. Some of those patients are city employees and retirees; the municipal labor union DC37 sent a notice to its members warning of the potential changes, according to a report from Politico.
Memorial Sloan Kettering reaped $27 million in profits in the second quarter as patient procedures including radiology treatments and surgeries continued to rise, financial documents show.
The Upper East Side cancer center brought in $2 billion in total revenue between April and June, according to its quarterly earnings statement released last week. Earnings from hospital services accounted for $1.7 billion of that revenue, with money earned from patient care rising nearly 10% from the same time last year.
The health system has had a bump in patient procedures in recent quarters as demand for cancer care increased after the Covid-19 pandemic. Procedures including surgeries, radiation oncology treatments and inpatient stays have all risen in the past year.
Radiology treatments continue to increase at a faster pace than other types of patient services, increasing 8% since the first half of 2023, according to financial documents. Memorial Sloan Kettering performed more than 390,000 radiology treatments during the first half of this year.
The revenue bump contributed to an overall “healthy” financial performance from Memorial Sloan Kettering in the first half of the year, according to Dr. Ge Bai, professor of accounting and health policy at Johns Hopkins University in Baltimore. Memorial Sloan Kettering had a 1.4% operating margin during that time period.
The cancer center’s expenses rose 9% in the second quarter, totaling $1.9 billion. The health system paid $979 million on salaries and benefits and $822 million on pharmaceuticals and medical supplies, financial documents show. The health system said that the nearly 14% uptick in supply costs in the second quarter stems from the rise in patient care and expenses associated with performing more cancer procedures.
The hospital’s salary and benefit expenses doubled from the same time last year. The cost increases follow Memorial Sloan Kettering’s decision to lay off more than 300 workers last year to cut costs amid economic challenges.
A spokesperson from Memorial Sloan Kettering did not respond to an inquiry about the increase in labor expenses by publication time, nor whether the hospital has hired back additional employees.
Memorial Sloan Kettering employs 20,000 physicians, nurses and health care workers.
A year ago, the hottest transit question in New York was how to renovate Penn Station. As politicians and developers squabbled over competing proposals, there was one thing almost everybody agreed upon: It was vital to act fast.
“We’re no longer tolerating delays,” Gov. Kathy Hochul said at a June 2023 press conference at the Midtown rail hub. She vowed to press ahead with the state’s $7 billion project to transform the station into a single-level facility with a wide-open entrance hall, even as she shelved a plan to pay for it by permitting new skyscrapers.
Rail-friendly President Joe Biden’s presence in the White House promised a good shot at securing federal funding. But Metro-North trains were set to arrive at Penn Station starting in 2027 as part of a separate project, leaving little room for a big renovation. In the governor’s view, New York had a “narrow window” to rebuild the station, her office wrote in a confidential memo to local elected officials in the lead-up to the June event.
But more than a year later, that sense of urgency seems to have dissipated, with little public word from either the state or Italian developer ASTM, whose renovation plan had garnered significant support.
Multiple state lawmakers told Crain’s it has been months since they received any significant update on the project from the governor’s office, and Hochul has yet to follow through on a suggestion that she might open up the process to proposals from private developers instead of leaving the plan in the hands of the Metropolitan Transportation Authority, which would rely on public funding. Meanwhile, Hochul’s last-minute suspension of congestion pricing, the funds from which could be funneled toward the upgrade, and a failed first attempt at winning federal aid have deepened questions about the project’s financial viability.
State Sen. Liz Krueger noted that work has been ongoing, albeit more behind the scenes than last summer’s public announcements. She pointed to recent progress on repairs and renovations to the underground parts of the station that connect with subway exits, such as raising the ceiling height and addressing fire safety issues.
“Everybody likes to focus on the grandeur that’s possible with the ground level,” Krueger said. “What’s crucial is that they’re moving forward with the underground part of it.”
But others who cheered last year’s talk now say they are worried.
“It feels like our chance to do something truly grand is slipping away,” said Manhattan Borough President Mark Levine. “I don’t want to wait yet another decade for transformation.”
Changes at ASTM
State leaders have clamored for years to renovate Penn Station, the nation’s busiest rail hub, where some 600,000 daily commuters navigate a warren of corridors buried below Madison Square Garden. Besides improving the passenger experience, officials say, the renovation is also necessary to reduce crowding and improve safety. (These changes are separate from the longer-term plan to expand Penn’s rail capacity by building new platforms, which might require bulldozing a nearby city block.)
The ASTM plan, the only significant idea put forward by a private developer, generated lots of buzz last year thanks to a mix of aggressive lobbying and clever designs. The firm’s $6 billion proposal shared the state’s vision of a grand train hall but notably differed by proposing to purchase and demolish the Theater at Madison Square Garden to make way for an Eighth Avenue entrance to Penn.
And unlike the state plan, which would rely on public funding, ASTM wanted to pay for its project through a public-private partnership in which the developer would put up the money and then be repaid by the government.
But ASTM’s momentum seems to have stalled since then, and the company itself has gone through changes in recent months. Patrick Foye, a former MTA chief who lent the plan credibility as ASTM’s CEO, departed the company at the end of 2023 and now works for an investment firm, according to his LinkedIn profile. (Foye did not respond to a request for comment.)
As a result of other internal changes, New York-based construction firm Halmar International is now leading the Penn project, a person familiar with the organization said. The company is a subsidiary of ASTM and is run by CEO Chris Larsen, a major donor in local politics.
Peter Cipriano, a former federal transportation official who has spearheaded the Penn proposal as Halmar’s executive vice president, said in a statement that the company remains ready to act. However, doing so would require Hochul to open up a process for developers to submit proposals — something she appeared to hint at last year, when she said the state would be “open now to any architect, any design firm, any engineer, to allow them the opportunity to compete for a position.”
“As soon as a process for selecting a master developer kicks off, we will be ready to respond,” Cipriano told Crain’s.
But the ASTM-Halmar plan has been hindered by hostility from the MTA, which could stand to lose some authority over the renovation if a private developer entered the picture. MTA officials disparaged the ASTM plan last year as a waste of money and a giveaway to Madison Square Garden — and emails obtained by Crain’s through a public records request shed more light on the tensions among the developer, the transit agency and Hochul’s office.
In March 2023, hours after details of the ASTM proposal were leaked in a New York Times article, Jamie Torres-Springer, the president of MTA Construction & Development, asked ASTM executives if they would “care to share” their design package with the MTA before a meeting scheduled for the next day.
“It just seemed to me if you were sharing it with the NY Times and many other stakeholders that I have hear[d] from that it would be appropriate to share it with the MTA,” he wrote in an email.
Cipriano forwarded the exchange to Nivardo Lopez, Hochul’s former deputy secretary for transportation, and called Torres-Springer’s complaints “a bit silly.”
“Obviously the [Executive] Chamber is in receipt of our deck and he will see and receive it tomorrow after declining many opportunities for meetings,” Cipriano wrote.
Months later David Weinraub, a top Albany lobbyist who was hired by ASTM to promote its bid, vented his own frustrations to Karen Keough, Hochul’s personal secretary, who is known to have the governor’s ear. In a June 28 email that came a day after MTA CEO Janno Lieber publicly criticized the ASTM plan as a bailout for the Garden, Weinraub called Lieber’s comments “outrageous, especially in light of the fact that we have never, ever had an opportunity to present our plan to him, you or the Governor.”
“You want details? Put out a real RFP for a master developer,” Weinraub continued in his missive to Keogh. “For Janno to shit on us and MSG takes away any opportunity for a fair competition even if there was one put forward.”
A year later some public officials still think highly of the ASTM-Halmar plan, although Krueger indicated the developer had exaggerated the sense of urgency around its proposal. She said ASTM felt it was in its best interests to build up momentum, so that is what the firm tried to do.
“Look, I like their design plan. It’s pretty,” Krueger said. “But I’m not sure ‘pretty’ is the ultimate target of what we need to do.”
Grant troubles
The MTA has had its own bumpy ride when it comes to progress on Penn Station. In June 2023, when Hochul announced she would “decouple” the renovation from the plan to build office towers around it, her office explained that it would make up for the loss of funding by applying for a federal grant to advance design work.
But that $100 million grant request was rejected by the Federal Railroad Administration later that year, a setback that the MTA said little about at the time. In July 2024 the MTA applied again for a grant — this time, a $96.7 million request in which the federal government would cover 75% of the cost.
The latest application reflected the progress on design that had been made and also expanded on project development, Sean Fitzpatrick, deputy chief of staff at MTA Construction & Development, told Crain’s. The state’s design plan has been led by the architect FXCollaborative and engineering firm WSP USA.
The MTA would not provide an update to Crain’s about the overall status of the design. In July 2023 Torres-Springer told the City Council that the state would have its design 30% done within a year, at which point Penn Station’s three railroads would decide how to hire a builder.
The congestion pricing factor
Virtually all theorizing about Penn Station’s future was scrambled in June, when the governor abruptly halted the congestion pricing program that was supposed to serve as a linchpin for the MTA’s future finances.
The ramifications of that are still being felt, but it seems all but certain to further complicate the already fraught process of trying to improve the station.
Multiple state lawmakers and transit advocates said they expect that the governor’s abrupt about-face on congestion pricing will further delay any meaningful action at the station, given that it has already forced the MTA to reevaluate every other major project in its capital budget.
But at least publicly, the agency has signaled no changes. At a July meeting Torres-Springer said Penn renovations may still be a key part of the agency’s upcoming capital plan for 2025 through 2029 — if the new bid for federal funding is successful.
“We are still looking at and working hard on the future of Penn Station,” he said. “Provided that that funding comes through, we’ll be moving that Penn Station modernization project forward in the next plan."
But Hochul’s reversal on congestion pricing also may have shattered trust in the governor among transit advocates and Manhattan politicians who had supported the toll. Her willingness to back away from one politically difficult transportation project might not bode well for Penn Station, some say.
Matthew Gorton, a spokesman for the state’s construction arm, Empire State Development, said in a statement that Hochul “remains committed to her vision for a new and improved Penn Station, anchored by thousands of new homes, seamless access to transit, and major improvements to the surrounding streets and sidewalks.”
Oddly enough, some people sympathetic to the ASTM-Halmar project believe the congestion pricing pause works in the developer’s favor. With the state short on cash, offloading the project to a private company may seem more appealing.
“One of the benefits of a [public-private] process,” said Tom Wright, president of the Regional Plan Association, “is it doesn’t rely on large capital dollars from public entities.”
Caroline Spivack contributed reporting.
Here are the subway disruptions, road closures and other commuting changes you should be aware of as you get around the city this week.
Subways* In Brooklyn, no G trains between Bedford-Nostrand avenues and Church Avenue until Tuesday, Sept. 3 at 5 a.m. * Due to track replacement work, B and Q trains run every 10 minutes between Tuesday, August 20 and Friday, August 23 from 10 a.m. to 3 p.m. * Trains on the 2 line run every 16 minutes between Gun Hill Road and Wakefield-241st Street on Wednesday, Aug. 21 from 10 a.m. to 2 p.m.
Commuter rail* Eastbound Long Island Rail Road trains skip Hollis and Queens Village stations, Monday through Thursday from 9:45 a.m. through 3:00 p.m. through Aug. 29. MTA buses will accept LIRR tickets for travel from Jamaica to Hollis and Queens Village.
Roads and bridges
No major disruptions.
Read recent transportation stories:
The ground is about to shift under the real estate industry as a fundamental change in the way we buy and sell houses takes effect, but most leaders in the field say after considerable shakeup it will leave little damage.
That is, if everybody will just chill.
The change, which upends the century-old standard of agents for a buyer and seller splitting a commission paid by the seller, was announced five months ago but goes into effect this week. It's one of the terms of the settlement reached by the National Association of Realtors after a federal jury found the long-held commission standard amounted to the real estate industry colluding to keep commissions — and by extension home prices — higher than they need to be.
Most real estate agents in New York City operate under the umbrella of the Real Estate Board of New York, which is not part of the NAR and therefore means they will be largely untouched by the changes. Still, realtors in the suburbs and across the country may be affected.
The biggest difference taking effect Aug. 17 is that a seller's offering on a multiple-listing service can't include any details about how the buyer's agent will be compensated. That leaves buyers tasked with ensuring their brokers will get paid.
In the past, the entrenched "cooperative commission" setup relieved buyers of ever having to consider how their agent would get paid.
The NAR's settlement stipulates that before touring properties with an agent, buyers will have to sign an agreement that says, among other things, they know they're responsible for the agent getting paid if a deal gets made. While not unprecedented—some brokerages had been advising buyers' agents to use these agreements for years—they'll now become a requirement.
Real estate executives told Crain's that while the change is epochal, it's also no big deal.
Because the NAR's settlement gave them a five-month runway, "we are feeling prepared, not paralyzed," said Kamini Lane, president and CEO of Coldwell Banker Realty, which is based in Madison, New Jersey. Most brokerages report their agents have trained extensively on how to talk their clients — and themselves — through the change. Lane and other brokerage executives said agents have been training on the new model for weeks, in Zoom calls, town halls, conference calls and other media.
There are also explanatory blogs and social media posts, but "we really feel like the changes are best communicated personally, from agent to client," said Amy Corr, chief brokerage officer at @properties Christie's International Real Estate.
A buyer broker "will have the same kind of conversation with buyers that we've always had with sellers," said Mark Pasquesi, president of brokerage for Berkshire Hathaway HomeServices Chicago. Sellers have long understood that broker compensation comes out of their proceeds on the sale.
Signing a broker's agreement might feel intimidating, particularly to first-time buyers who are eager to look at all the exciting possibilities they might buy, but it's a relatively brief, eminently practical step. "Upfront conversations between agents and their clients, where expectations are set about how a transaction might unfold, are really important," Corr said.
For example, some buyers might have the cash on hand to pay their broker out of their own pocket, just as they do the down payment. Other buyers may structure their offers to get a closing credit from the seller so they can pay the agent.
Move-up buyers are the most likely to have cash on hand to pay their broker outright. As they often put the built-up equity from their previous address into the new one, bringing down the mortgage amount they'll need, they might opt to pay their broker directly out of the equity, rather than have it boomerang out through the seller and back to the buying agent as it has in the past.
This, too, would be something the buyer broker would spell out in an offer on a house: The price being offered the seller is X dollars less than it would otherwise be, because it includes no commission to the buyer broker.
"These details are all going to have to be explained in the offer now," said Laura Ellis, president of residential sales at Baird & Warner.
Cooperative compensation, the now countermanded commission-sharing principle, is not forbidden under the NAR's settlement, it's just not to be discussed on the MLS.
Some brokerages plan to keep it alive by posting sellers' offers of buyer compensation on their websites. Coldwell Banker is one of them, according to Lane.
"We believe voluntary offers of buyer broker compensation help sellers secure the best offer for their home and the highest certainty in their transaction," Lane said.
Others, including Baird & Warner and @properties Christie's International Real Estate, are closing the door on the practice that, rightly or wrongly, led to scrutiny from the U.S. Department of Justice as well as a spate of lawsuits.
"We are leaning into the changes per the NAR settlement," Corr said, "and what we believe the DOJ is ultimately looking for in how brokerages conduct business." In documents filed in some lawsuits, the DOJ has strongly signaled that it wants to see the industry move toward buyers paying their own brokers.
"We also believe that buyer-broker compensation will become a normal part of the contract negotiations between buyer and seller," Corr said.
That and other parts of the new real estate landscape "will evolve in the next few years," Pasquesi said.
A $115 million purchase of a duplex high above Central Park in June ended a nearly two-year drought for the city’s ultra-luxury real estate market.
The closing was ultimately a turning point. Less than a month later, a nearby five-story penthouse went for $135 million.
With more than four months of the year still to go, home sales of $100 million or more are on pace to set a new record in the city. Billionaires globally have seen their wealth boom, generating momentum for major home purchases. The pace of sales is spurring optimism among agents tasked with finding buyers for other top listings around the U.S.
Nationwide, there have been six deals at $100 million or above this year through the end of July, just three shy of a record set in 2021. Those have stretched from Southern California, where an oceanfront estate notched a record for the state at $210 million, to Aspen, Colorado — where a transaction this year crossed the nine-figure threshold for the first time.
The pace of ultra-luxury deals isn’t expected to let up anytime soon. Over in Malibu, one agent is preparing to put a mansion up for sale in a private listing for $300 million, which would set a record for the most expensive U.S. home sale if it gets an offer at that level. Another agent in the area, Aaron Kirman, said he’s working with a few buyers who are looking for mega-mansions in Los Angeles or Malibu, and also has a pair of nine-figure listings, including a $115 million European-style villa in Bel Air.
“I’ve had more billionaires call me so far this year for $100 million homes than I had in the whole of last year,” said Kirman, who is chief executive of Christie’s International Real Estate Southern California. “They want what they want when they want it — and they’re willing to pay for it.”
While the pool of potential buyers is still small, top-tier billionaires have watched their wealth swell over the past few years. In early January, the median net worth of the world’s 500 richest people was $9.3 billion, according to the Bloomberg Billionaires Index. By August, it was almost $9.9 billion, meaning a $100 million home purchase would account for just about 1% of their wealth.
Now, there are even more homes for them. As the wealth of billionaires boomed, construction started on various projects catering to the richest, and many of those properties are becoming available. Plus, business titans including Jeff Bezos and Ken Griffin are becoming even more strategic about their massive real estate portfolios, finding ways to snap up plots of land in Florida to create even larger estates for their families.
“Clearly there’s demand, which seems to be increasing,” said John Gomes, co-founder of the Eklund Gomes Team at Douglas Elliman Real Estate. “There is definitely an upward trajectory, and we might even double this year what we did last year.”
Bargain-hunting billionaires
Sky-high listing prices won’t mean that the property always sell for that much. Both New York sales ultimately went for less than what the sellers initially asked.
The transaction at Central Park Tower closed in June for about $60 million less than the $175 million Extell Development listed it for last year. In July, Vladislav Doronin shelled out $135 million for the very top floors of a project he’d developed, the Aman New York. That figure was lower than the $180 million that a different buyer reportedly agreed to pay for the unit in 2018.
While some billionaires are looking for relative bargains, others have very specific demands and are willing to pay up to get what they want, said Fredrik Eklund, who worked with Gomes and Kent Wu to bring an undisclosed buyer to the Central Park Tower deal.
“They have their eyes on something and they only want that,” Eklund said. “They overpay or not — it doesn’t matter.”
Some of the richest homeowners have been stitching together massive estates through multiple expensive sales. In Florida, Bezos paid $147 million last year in separate transactions for two neighboring properties on Indian Creek island and agreed to buy another for $90 million in April.
Jills Zeder Group founder Jill Hertzberg worked with Griffin to stitch together adjacent parcels on Star Island that cost a combined $194 million. Now, she said, he’s being offered double or even triple what he paid for the assemblage but isn’t going to sell.
“He’s not interested,” she said. “Someone like him had the foresight when no one else was doing it.”
‘Master of the universe’ residences
The richest buyers are often interested in new homes, according to Hertzberg. But if they can’t find one that a developer or occupant is willing to sell, some are more open to knocking the buildings down and starting over instead of renovating the old properties, she said.
“It used to be when I first came to Miami Beach, people renovated these old Mediterraneans, the Art Decos,” Hertzberg said. “And then people started coming in with star architects who would say, ‘No, let’s take it down.’”
She expects her $132 million listing of four adjacent homes on La Gorce Island in Biscayne Bay to close in the coming weeks, with one buyer purchasing three and another acquiring the fourth. The larger transaction will fall just short of nine figures.
For buyers looking for newly built properties, there are more options under construction. A penthouse at Miami Beach’s forthcoming Shore Club Private Collection went into contract for more than $120 million in March. If it closes at that price when the building is completed in a few years, it would double the record for a Miami-area condo set by Griffin in 2015.
“The supply is finally coming,” Eklund said. “Every single project that we’re working on, we are doing these master-of-the-universe kind of residences on the top.”
Peter Pan Bus Lines has taken over all Megabus routes in the Northeast and Mid-Atlantic region, expanding its offerings at the Port Authority Bus Terminal, according to the company.
As of Thursday evening the Massachusetts-based company has doubled its number of coach buses that New Yorkers can catch from the bus terminal each day to Philadelphia, Baltimore and Washington, D.C., among other locations, through its acquisition of Megabus’ routes. The deal comes two months after Coach USA, owner of the Megabus brand, filed for bankruptcy protection as it works to shed debt and streamline its operations.
The transaction is purely a takeover of bus service, which Megabus previously operated out of a curbside stop near the Jacob Javits Center, and is not an acquisition of the brand by Peter Pan. The former Megabus routes will now run in and out of the Port Authority.
“I think everybody wins: Megabus continues to stay in business as a [sales operation], we get more passengers, and passengers get much more frequency and more destinations,” Peter Picknelly, chairman and chief executive of Peter Pan Bus Lines, told Crain’s.
Under the agreement, Megabus has ceased operating its Northeast and Mid-Atlantic routes but is still selling tickets on its website for its service (now operated by Peter Pan). Megabus will receive a commission for ticket sales, said Picknelly. And technology company TransCore will monitor sales through both Peter Pan’s and Megabus’ websites to ensure buses aren’t overbooked.
Ticket prices vary; a one-way ticket from New York to Washington, D.C., departing on a Monday would cost $34.
Previously, Peter Pan ran about 28 trips per day in both directions between New York and Washington, D.C.; with the Megabus takeover, that number has doubled to 56, Picknelly told Crain’s.
The arrangement isn’t the first time Peter Pan has absorbed Megabus service. About three years ago the 91-year-old company took over Megabus’ service between Boston and New York in a similar deal.
Megbus, which launched in 2006, serves some 280 cities. It will continue to operate in other markets, including Seattle and Boise, Idaho.
Peter Pan, meanwhile, is a family-owned company with a smaller reach of about 100 cities. In 2023 the company generated $98 million in revenue, according to Zippia, a jobs search website that tracks company data. Peter Pan declined to share its latest revenue figures.
Eric Adams’ mayoral primary opponents couldn’t have been too upset about Thursday’s news that the mayor, his office and his campaign have all received subpoenas as part of a federal corruption probe. The New York Times report was the latest in a slow drip-drip of disclosures that have emboldened Comptroller Brad Lander, former comptroller Scott Stringer, and State Sen. Zellnor Myrie to all make plans to challenge Adams in next year’s primary.
Still to be seen is whether the new developments will awaken the mayoral race’s sleeping giant: former Gov. Andrew Cuomo, who continues to deliberate about his own potential campaign.
Cuomo has been considered unlikely to run if Adams stays in the race, although the ex-governor early this year notably criticized Adams’ handling of water contamination in a public housing development. An advancing federal probe into Adams could complicate Cuomo’s calculations.
A person close to Cuomo who requested anonymity told Crain’s on Friday that “people are talking to him about both running for mayor and running for governor, citing a current deficit in leadership in both.”
One reason Cuomo has been expected to avoid challenging Adams is their shared reliance on Black voters, a coalition that could split if both men were running. But the existence of ranked-choice voting means that both Adams and Cuomo could conceivably draw votes from the same groups.
“Cuomo would need some Black support,” said political consultant Lupe Todd-Medina, who voiced skepticism about whether Cuomo would challenge the incumbent mayor. “Something much more unfortunate would have to happen to Mayor Adams for me to see Andrew Cuomo jumping in.” (Todd-Medina worked on the re-election campaign of Cuomo's successor, Gov. Kathy Hochul.)
The subpoenas, which the Times said were issued in July, were confirmed in a public statement by Adams’ attorneys, Brendan McGuire and Boyd Johnson. The attorneys said that they “continue to cooperate with the investigation and are in the process of responding to the recently issued subpoenas.”
McGuire and Johnson added that they have conducted their own investigation over the last nine months into the same areas being reviewed by federal prosecutors: analyzing campaign documents, interviewing witnesses and reviewing tens of thousands of electronic communications.
“To be clear, we have not identified any evidence of illegal conduct by the mayor. To the contrary, we have identified extensive evidence undermining the reported theories of federal prosecution as to the mayor, which we have voluntarily shared with the U.S. Attorney,” the lawyers said. “We continue to look forward to a prompt and just resolution of this investigation."
The full scope of the investigation remains unclear, beyond its established connection to potential illicit dealings between Adams’ 2021 campaign and the Turkish government. Two former federal prosecutors told Gothamist Friday that the subpoenas suggest the investigation — which reportedly began in 2021 — may be nearing its conclusion.
If Cuomo did enter the race, he would become a top contender instantly. A poll last year found he would lead the pack of potential candidates if Adams did not run. On the other hand, it would be a struggle to transfer his $8 million in state-level campaign funds toward a city-level campaign, and he carries the obvious baggage of having resigned following multiple sexual harassment accusations and controversy over his handling of Covid-19 in nursing homes. (Cuomo has recently denied wrongdoing in both areas, although he initially apologized for some of the harassment allegations.)
There are other reasons to think Cuomo might not want the mayor’s job. New York City’s government is subordinate to the state, and it is difficult to imagine the famously prideful Cuomo trudging to Albany to essentially beg Hochul for funding each year.
Cuomo, in a June appearance on “Real Time with Bill Maher,” said only that “I have no current plans to make plans” for a run for mayor or governor.
In a friendly interview on a radio talk show on Friday, Adams acknowledged “an active review of our 2021 campaign,” and said he had “completely compiled every document that was requested of us.”
“We believe the federal government is going to do their review,” Adams said. “We've been extremely transparent about making sure if there are documents that's looked at, they're going to see text messages or any other items. We're going to turn it over and walk away.”
Prolific developer Thor Equities has scooped up a former Brooklyn chocolate factory turned loft-style apartment building for $58.5 million, according to a deed that appeared in the city register Thursday.
The Manhattan-based real estate firm, led by Brooklyn native Joseph Sitt, acquired 275 Park Ave. in Clinton Hill under a limited liability company named after the property's confectionery origins from the developer Fairstead, headquartered near Columbus Circle.
Originally built in the 1890s as a Tootsie Roll factory, the 7-story building just outside the Brooklyn Navy Yard was converted in the early aughts into 123 rental apartments — its authentic concrete beams and exposed brick were preserved during the renovations. None of the units are currently available; the most recent to be rented was a 1,100-square-foot studio that went for $4,700 at the end of April, according to StreetEasy.
The 174,630-square-foot building, between Waverly and Washington avenues, at the foot of the Brooklyn-Queens Expressway, also contains five commercial spaces, including a spa, a coffee shop, a coworking space and a comedy club, all of which are leased, according to the brokers who handled the deal.
Thor Equities, which is also angling for approvals from both city and state officials in order to develop a sprawling casino complex in Coney Island, got a sweet deal on the Park Avenue property. Sitt's firm, headquartered near Bryant Park, paid $8.5 million less than Fairstead did when it bought the building for $67 million in 2019, records show. Fairstead CEO Jeffrey Goldberg signed the deed himself. Fairstead did not respond to a request for comment.
Attorney Morris Missry, a managing partner at the Midtown-based law firm Wachtel Missry, who often handles such transactions for Thor, signed the papers on behalf of Sitt's company but did not respond to a request for comment.
Sitt, however, said in a statement that the "investment strengthens our presence in high-growth markets and supports our approach of enhancing and diversifying our assets."
Brokers Aaron Jungreis, Ben Khakshoor and Alex Fuchs of the Manhattan-based firm Rosewood Realty Group represented both parties in the deal.
Leases
Italian restaurant opening Nolita location
Address: 210 Elizabeth St., Manhattan
Landlord: SW Management
Tenant: Dante NYC
Lease size: 10,000 square feet
Lease length: 15 years
Asking rent: $1 million per year
Asset type: Retail
Brokers: Murro Realty's Jarrett Sharp and Gage Sharp represented the tenant and the landlord.
Sales
Thor buys Clinton Hill apartment building
Address: 275 Park Ave., Brooklyn
Seller: Fairstead
Buyer: Thor Equities
Sale price: $58.5 million
Asset type: Multifamily
Brokers: Rosewood Realty Group's Aaron Jungreis, Ben Khakshoor and Alex Fuchs represented the seller and the buyer.
Argent Ventures sells stake in Midtown hotel
Address: 1601 Broadway, Manhattan
Seller: Argent Ventures
Buyer: Michael Loeb
Sale price: Approx. $53.3 million
Asset type: Hotel
Chelsea apartment building trades hands
Address: 246 W. 18th St., Manhattan
Seller: Direct Management Corp.
Buyer: 246 West 18th Street Land LLC
Sale price: $10.5 million
Asset type: Multifamily
Financings
Nonprofits secure funding for Wakefield development
Address: 4421 White Plains Road, Bronx
Owner: Tahisha Lue-Hing and Anne Elizabeth Fontaine
Lender: M&T Bank
Loan amount: $29.6 million
Asset type: Mixed use
This spring, state lawmakers quietly extended a generous commercial tax break that costs New York City hundreds of millions of dollars each year despite questions about its effectiveness. Now a fiscal watchdog group is urging Gov. Kathy Hochul to reject the renewal.
The Industrial and Commercial Abatement Program reduces taxes for developers who build new commercial projects or renovate existing buildings in the city. The current version, established in 2008, fully exempts taxes for as long as 16 years for some projects, then phases out the abatement over another few years — with the exact benefit varying depending on the location and type of project.
New York City lost $503 million to the abatement in the last fiscal year, according to the Department of Finance. ICAP’s biggest beneficiaries included Tishman Speyer, whose tower at 28-10 Queens Plaza South got a $16.6 million exemption; and Citibank, which was forgiven $8.8 million on its Tribeca headquarters.
This “as-of-right” subsidy is automatically given to any projects that qualify, and its size has ballooned over time — ICAP cost the city just $28 million in fiscal year 2016. Around the same time, the City Council released an evaluation that found only 3.6% of ICAP recipients required the tax breaks for their projects to be financially feasible, calling its necessity into question.
Yet in June, the state Legislature voted almost unanimously to extend ICAP for another four years, at the request of Mayor Eric Adams — a year before the program was supposed to expire, in March 2025. The independent Citizens Budget Commission is now calling on the governor to veto the extension or limit it to just one year to allow for a study of its effectiveness.
“The rushed, under-the-radar ICAP extension continues the state’s poor practice of preserving economic development tax incentive programs without proof they work—or in some cases, despite evidence they are ineffective,” CBC President Andrew Rein wrote in a letter to Hochul, which was first reported by New York Focus.
In fact, the city’s own Independent Budget Office has been preparing an evaluation of ICAP, which is expected to be released later this year.
The Related Cos., Tishman Speyer and the Real Estate Board of New York all lobbied lawmakers on the extension this year, records show. REBNY spokesman Chris Santarelli said in a statement that ICAP is “critical to ensuring that New York continues to attract high-paying employers and the daytime foot traffic that is essential for vibrant commercial business districts.”
The Adams administration pushed the extension based on fears that letting ICAP expire would cause a sudden surge in electricity prices. Regulators who set electricity prices in New York City consider the property tax rates paid by power plants, according to a memo from the bill’s sponsors. (No such power plants currently receive the break, New York Focus noted.)
Ryan Lavis, a spokesman for the city’s Department of Finance, said in a statement that ICAP’s extension is “necessary” for that reason.
“Reforming ICAP continues to be a key focus for this administration, and we are committed to working with our partners in the state to address equitable reform,” Lavis added.
Hochul has until the end of the year to act on the bill from the Legislature but has not yet called it up to her desk.
Tax abatements like ICAP are set at the state level, even as they take money out of the city’s coffers. Current City Council leaders have voiced support for reassessing some of the state’s multitude of abatements and incentives in hopes of saving money, but the highly entrenched system — supported by lobbying and justified by economic development claims — shows few signs of going away.
Other ICAP beneficiaries in the last fiscal year, according to city records, included Brookfield Properties’ 450 West 33rd St. ($7.2 million forgiven taxes), SL Green’s 1515 Broadway ($6.7 million) and the Irvine Cos. and Tishman Speyer’s 200 Park Ave., better known as the MetLife Building ($6.1 million).
A Pew Research Center survey from 2022 found that a significant majority of people, 69%, favored the U.S. taking steps to become carbon neutral by 2050. New Yorkers, in particular, understand the urgency of this goal. They've witnessed the direct impacts of climate change, such as rising sea levels and severe storms that have flooded streets and subways, bringing the city to a standstill. Buildings are New York’s largest source of greenhouse gas emissions, accounting for roughly 70% of the total. This challenge extends beyond New York; globally, buildings are responsible for 40% of greenhouse gas emissions. To effectively tackle the climate crisis, we need widespread adoption of building decarbonization initiatives. So, why is the city considering weakening one of the most ambitious climate action plans, Local Law 97?
Intro 772 proposes changes to Local Law 97 (LL97), allowing some buildings to count ground-floor open and green spaces in their square footage when calculating carbon emissions, enabling them to bypass necessary carbon-reduction measures. While some may view Intro 772 as a cost-saving measure in the short term, this narrow perspective will cost the city and its residents far more in the long run, as it often does. The proposed measures in Intro 772 will set New York back in its fight against climate change and cause the city to lag behind its peers.
LL97 mandates that most buildings over 25,000 square feet adhere to new energy efficiency and greenhouse gas emissions limits starting in 2024, with stricter limits set for 2030. However, Intro 772 would exempt 33% of the city’s housing stock from these regulations. The changes would allow co-ops and condos to include gardens and other green spaces in their carbon emissions calculations and permit the courts to consider a building’s median property value when determining penalties and fines. This adjustment would enable buildings to emit more carbon while facing fewer penalties.
This bill is gaining momentum in the City Council, with 24 out of 51 council members supporting it. It follows other recent attempts to roll back climate action, such as halting congestion pricing and defanging an impactful energy efficiency measure—individual apartment temperature controls—from the affordable buildings’ prescriptive energy conservation measure requirement list.
If LL97 is diluted, New York City will fall behind cities like Washington D.C. and Boston, which have implemented aggressive climate action plans. If these cities can achieve this, so can New York. By decarbonizing buildings and prioritizing sustainability, we can realize cost savings, create healthier communities, and meet critical benchmarks. Backtracking on climate legislation now will not support our future livability—something UN Secretary-General António Guterres emphasized during a climate address in New York this June.
New York City has historically been an early adopter of climate action, even hosting a global sustainability summit 17 years ago for the C40 network, which includes nearly 100 mayors from the world’s leading cities united in confronting the climate crisis.
We must stay the course. Relaxing regulations will significantly hinder New York’s sustainability goals and send a message of lack of support to individuals and companies leading carbon reduction efforts. To build a sustainable future, New York must uphold and strengthen its climate regulations, demonstrating bold leadership and a commitment to environmental stewardship.
Now is the time for decisive action to create a more sustainable future for our city and our planet.
Marshall Cox is the co-founder & CEO of Kelvin, a New York City-based climate tech company.
The problems are piling up for Aby Rosen's RFR.
Citibank and JPMorgan Chase have filed a lawsuit seeking to foreclose on the developer's office building at 475 Fifth Ave. in Midtown. The suit, filed Thursday in Manhattan state Supreme Court, names Rosen himself and his partner, Michael Fuchs, as defendants.
RFR bought 475 Fifth Ave., located right by Bryant Park between East 40th and East 41st streets, for roughly $290 million in May 2022 from Nuveen Real Estate and Norges Bank Investment Management. That month Citibank and JPMorgan provided the firm with an $180 million mortgage, which was originally set to mature on June 9, 2023, the suit claims.
RFR and the banks agreed to push the maturity date to Dec. 9, 2023, and then to June 9 of this year, but RFR has still failed to make its payments on time, according to the lawsuit. The banks are thus exercising their right to foreclose and suing for the entire $180 million balance plus interest, late fees and legal costs, the suit says.
The building is well occupied, and RFR expects to refinance its debt imminently, according to a representative for the developer. Representatives for Citibank and JPMorgan declined to comment.
CoStar, the commercial real estate database, lists 475 Fifth Ave. as 91.9% leased. The 24-story, 275,000-square-foot tower was built in 1926 and renovated in 2013, and its asking rents range from $88 to $92 per square foot, according to RFR.
This is just the latest of several problems facing RFR, whose portfolio includes some of Manhattan's highest-profile skyscrapers, such as the Chrysler Building and the Seagram Building—although fellow real estate giant SL Green is rumored to be eyeing a takeover of the latter. The firm has fallen behind on property taxes at 90 Fifth Ave. near Union Square, sparking Fitch Ratings to downgrade the building, and it is facing foreclosure at 522 Fifth Ave. in Midtown as well. A lender on RFR's commercial condos at 122 Greenwich Ave. and 219 E. 67th St. has also filed to foreclose on those properties, The Real Deal recently reported.
RFR did sell 980 Madison Ave. on the Upper East Side to Bloomberg in June for $560 million, providing it with a solid financial boost. And it is looking to sell 281 Park Ave. South, a Gramercy Park building that played a role in notorious fraudster Anna Delvey's downfall.
JPMorgan Chase and Tyko Capital, which is backed by Elliott Investment Management, have provided nearly $1.2 billion in financing for luxury towers on Manhattan’s west side.
The lenders closed on the refinancing for One High Line, a pair of twisting towers that includes luxury condos and a hotel, according to the developers. JPMorgan provided a senior mortgage, while Tyko was behind the mezzanine financing.
The developers — Witkoff, Len Blavatnik’s Access Industries and Monroe Capital — bought the partially completed project out of foreclosure in late 2021. The refinancing was arranged by Walker & Dunlop.
Representatives for JPMorgan and Tyko declined to comment.
The deal is one of the largest financings backed by a single asset so far this year. Many lenders have shied away from providing large loans for real estate projects.
The High Line project in West Chelsea had a rocky past under previous ownership, with its initial developer HFZ Capital Group paying a record-setting price for the land in 2015 and then running out of money. Now, One High Line has secured more than $800 million in sales.
Demand for condos in New York has remained solid. In the second quarter, the median sale price was up 3.4% from a year earlier to $1.7 million, according to data from appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate.
Lenders today “want to back the best-in-class projects with best-in-class executions,” Alex Witkoff, co-chief executive officer at Witkoff, said in an interview.
The building has attracted many cash buyers so far, according to Witkoff. But if interest rates fall with potential cuts from the Federal Reserve, that could prove to be a boon, he said.
“Lower interest rates do benefit housing,” Witkoff said. “We’re quite bullish that not only will our pace of sales be sustained, but that it’ll even be picked up.”
A Manhattan-based developer is looking to revitalize a long-vacant stretch of an otherwise busy Brooklyn corridor with housing and retail, records show.
Bridges Development Group, under the limited liability company Empire Blvd Holdings, filed plans with the Department of City Planning to rezone a swath of land at the border of Crown Heights and Prospect Lefferts Gardens in order to erect a 13-story, mixed-use building at 73-99 Empire Blvd. — a quick walk from the easternmost edge of Prospect Park, near the entrance to the historic carousel.
The proposed 384,429-square-foot project would rise on the site of what was formerly a 1-story commercial building that had been vacant since 2014 before Bridges demolished it this year, an adjacent 8,000-square-foot laundry and a bare lot that's used for parking. The rezoning application hit what's called the "noticed" milestone last week, meaning the city's lengthy public review process can kick off in no less than 30 days, according to information from the Department of City Planning. Michael Berfield of Bridges Development Group is the applicant of record, according to the documents.
If the rezoning is ultimately approved by the city, the building would include 285 apartments — about 86 of which would be set aside as below market rate.
The development, between McKeever Place and Bedford Avenue, would include 99,221 square feet of commercial space — about 25,000 square feet of which would be used for a grocery store and the remaining 75,000 for retail — and 242,106 square feet of space for residential.
If the rezoning is disapproved, however, the developer would proceed with constructing a 72,878-square-foot retail building with 182 parking spaces, and there would not be any housing included, according to the filing. Construction would break ground in 2027 in either case and would take about two years.
A limited liability company named after the address bought the property slated for the rezoning for $15.1 million in 2021, city records show. Retail investor Alex Adjmi of Manhattan-based A&H Acquisitions signed the deed, according to the document. But Adjmi is not named in the actual rezoning proposal filed with the Department of City Planning, and it's unclear what his firm's involvement is.
Neither A&H Acquisitions nor Bridges Development Group responded to a request for comment.
Some 2 million freelance workers across New York state will come under new protections starting this month, when the Freelance Isn’t Free Act passed last year goes into effect.
The law, which takes effect Aug. 28, aims to address workers’ longstanding complaints of missing and late payments. It requires employers to provide contracts for all freelance work worth more than $800 over a four-month period, and make payments by the due date listed in the contract — or within 30 days of work being completed when no date is listed. It builds off a similar set of policies that New York City enacted in 2017.
Employment law firms have begun warning their clients about the “extensive” scope of the law, which will be enforced by the state attorney general. But Andrew Gounardes, the Brooklyn state senator who sponsored Freelance Isn’t Free, said the provisions are straightforward.
“Number one, the person you’re hiring is entitled to a contract. Number two, you have to pay them on time,” he said in an interview. “If you do those two things, you won’t have any problem whatsoever complying with this law.”
The law contains a few other provisions. Employers will be barred from offering less money than promised in exchange for a quicker payment — a bait-and-switch that freelancers say is all too common. And the contracts given to freelancers must include information like an itemized list of services being provided, the value of those services and the method of payment.
Little will change for New York City-based employers, who already had to comply with the city law of the same name. But Gounardes said city-based freelancers will now have more options if they feel their rights are being violated, with the ability to now file complaints with the state attorney general in addition to the city’s Department of Consumer and Worker Protection.
The state law also allows freelancers to file a civil lawsuit for non-payment or if their employer retaliates against them for exercising their rights. Workers who prove non-payment will be entitled to damages worth twice their promised fee, or $250 in damages if they prove they were never given a contract. The attorney general can also fine employers up to $25,000 if they have a “pattern or practice” of stiffing freelancers.
The law carves out construction workers, medical professionals and attorneys, none of whom are covered by the new protections.
Gov. Kathy Hochul had vetoed a previous version of Freelance Isn’t Free in 2022, saying it would put too much strain on the state’s Department of Labor. But she approved the bill last year after its authors shifted the enforcement burden to the attorney general’s office, making New York the second state after Illinois to enact such protections for freelancers.
The law was initially slated to take effect in May, but Hochul and the Legislature agreed to push the date back to August as part of a so-called “chapter amendment” added early this year after the bill had passed.
The AFL-CIO and International Brotherhood of Teamsters labor unions both lobbied lawmakers on the bill while it was being discussed last year, as did the National Federation of Independent Business. State records do not specify any of those groups’ positions on the bill
Supporters of the law have pointed to a 2022 survey of 400 freelancers nationwide, which found that nearly three-quarters said they do not get paid on time. Nearly 60% said they were owed more than $50,000 for completed work, according to the survey, which was done by the worker’s advocacy group the Independent Economy Council.
The 2,200-acre, marsh-covered swath of northwest Staten Island known as Fresh Kills has always been a dumping ground. On a recent Wednesday afternoon, the now defunct landfill was the recipient of thousands of pounds of pesticides dropped from a helicopter owned by the city Health Department. The target was millions of mosquito larvae and the man who ordered the deluge, Dr. Waheed Bajwa, head of the city’s Office of Vector Surveillance and Control, was trying to save human lives.
Bajwa is responsible for, among other things, controlling West Nile virus in the five boroughs, the issue he was hired to address in the early aughts when the virus still vexed public health officials. Sixty-one people have died from the disease since it first appeared in the city in 1999. Each year, as few as 3 and as many as several dozen infections are reported, but the Health Department estimates more than 12,000 cases of West Nile fever – a syndrome caused by the virus – have gone undocumented.
Bajwa is among the majority of scientists who believe changing global temperatures has led to a rise in several deadly mosquito-borne illnesses. New York City saw its own surge two years ago when 46 cases were recorded, an uptick in infections he suspects was driven by a new variant of West Nile. This year, the city experienced record heat in the first months of summer.
The vector lab has identified the virus in more than 1,000 samples of mosquitoes collected from testing sites around the city so far this year.
There is no treatment for West Nile virus and no human vaccine. While most cases are harmless, severe infections can cause swelling of the brain and spinal cord. Roughly 1 in 150 cases impact the central nervous system and 10% of those are fatal, according to the Centers for Disease Control and Prevention.
The primary method of controlling the virus has been to eradicate the mosquitoes that carry it. But mosquito breeding never stops and the work must begin again year after year. Bajwa believes if his office eased up there would be billions more pests each year and the number of deaths would likely rise.
“We are not killing mosquitoes. We are killing, actually, vectors of disease,” he said over the thwack of helicopter rotors.
Bajwa leads a team of 13 people with a lean $3.5 million budget. They spend the year collecting, testing and exterminating mosquitoes on a mass scale. The office, which also specializes in other disease-laden pests like ticks and fleas, has surveyed the entire city to locate breeding grounds, from sprawling swamps to flooded lawns. During the summer months, the team spends long days spreading pesticides – by hand or truck in residential areas, and helicopter over the wetlands.
The mosquitoes' territory is not homogeneous and different species tend to gravitate to different neighborhoods. They are particularly attracted to single-family homes, Bajwa said, where backyards and front lawns accumulate water. In 2022, the Health Department received 1,200 complaints of standing water on a property and issued 448 violations, according to a report from the office.
Mosquitos thrive in those neighborhoods, Bajwa said, adding, “but not in, like, posh areas of the city.”
Pest control has become a popular extract of Mayor Eric Adams’ focus on quality of life, raising far less ire than his policies on public safety and homelessness. Last year, Adams appointed the city’s first “rat czar” to much fanfare and allocated $3.5 million to curb pestilent rodents in Harlem.
While he views his work as crucial, Bajwa has kept a lower profile.
“I won’t consider myself a mosquito czar, but definitely we are trying to protect public health,” he said.
Immunity for the birds
Mosquito-borne illnesses are on the rise in the United States and globally. Mosquitoes carrying dengue fever and chikungunya have spread geographically with rising temperatures, according to the World Health Organization, and this year global dengue cases surged to historic levels.
The species carrying those diseases are not adapted to New York’s climate, but Bajwa is concerned that changes in the environment and in the virus itself could make West Nile more prevalent. That may have already happened in 2022, when the number of reported cases more than doubled – a level nearly as high as in 1999, before the city began controlling mosquito populations.
West Nile virus begins in birds and is transmitted to mosquitos that bite them. Year after year, rates in New York City rise and fall on a predictable basis as the birds who carry the virus gain immunity throughout their lifetime. But in 2022, the birds’ immunity appeared to vanish, Bajwa said.
He believes the city may have seen the first signs of a new strain the birds had never encountered before, one that could survive and multiply at lower temperatures.
Mosquito money
The office’s spending seems to be tied to immunity in the birds, too. Starting each year with a baseline budget of close to $3.5 million for mosquito work, the vector lab typically spends an additional $600,000 dollars by the end of the fiscal year, according to budget documents provided by the fiscal watchdog Citizens Budget Commission. In recent years, when West Nile cases spike, the spending adjustment has doubled to $1 million or more.
In response to the 2022 uptick, the city increased its larvicidal spraying, Bajwa said. His office even tested a different pesticide but it didn’t make much difference. When the Zika virus hit the scene in 2016, the Health Department pivoted to new pesticides that would control new vector species.
“Everything is data-driven,” he said.
In fiscal year 2019, after years of outside contracting, the Health Department bought its own helicopter for around $4 million, according to spokeswoman Shari Logan, in order to save money.
The city still hires out a pilot from Cutchogue-based North Fork Helicopters, whose last contract was worth roughly $1 million over six years, plus around $400,000 for storage and maintenance, according to records kept by the city Comptroller.
If he had the budget, Bajwa said he would look beyond spraying to what is known in medical entomology as “source reduction,” eliminating the breeding grounds themselves.
That would require draining wetlands and major flood remediation, work that has confounded the city’s Department of Environmental Protection. Some of the worst breeding grounds are the city’s 150,000 storm gutters; Bajwa’s office treats each one three times a year but he said even more could be needed as hot-weather periods grow. It would take 30 years to upgrade the most flood-prone drains at DEP’s current funding level for that work, roughly $1 billion per year, Commissioner Rohit Aggarwala testified in the City Council earlier this year.
Agricultural pilot David Carman said the flying is more technical than what most pilots deal with because of the intricacy of the maneuvering required.
“Keeps you sharp, keeps you on top of it,” he said at the launch site.
That day in August, Carman dropped roughly 12.5 pounds per acre. While Bajwa said the pesticide, Vectobac – a granular concentrate of bacteria found in soil – is not toxic, the city does not use it in residential areas and he encourages his staff to wear a mask. For adult mosquitos in residential areas, a teaspoon of a more potent concoction can treat more than an acre.
Bajwa does not relish his role as executioner. He said he wouldn't kill any bug if it was not harmful to humans. "Like butterflies. Who would want to kill butterflies? Nobody.”
BETH ISRAEL CLOSURE: A state judge issued a temporary restraining order yesterday that again blocked Mount Sinai from immediately closing Beth Israel. Manhattan state Supreme Court Judge Jeffrey Pearlman blocked the health system from starting to close its Lower East Side hospital until the court hears arguments planned for this afternoon. The restraining order was issued after community advocates filed a new lawsuit earlier this week challenging the Health Department’s approval of Mount Sinai’s Beth Israel closure plan, updating a previous lawsuit that the court deemed irrelevant.
DOH APPOINTMENT: The state Department of Health has tapped Dr. David Holtgrave to serve as senior policy advisor to the health commissioner. Holtgrave will guide the agency’s efforts to mitigate the opioid epidemic and improve substance use policies and programs. The new executive has held public health positions for the past 35 years, most recently working in the White House Office of National Drug Control Policy from 2022 to 2024.
FDA CLEARANCE: Park Slope biotech Cresilon was cleared by the U.S. Food and Drug Administration Thursday to sell Traumagel, its plant-based hemostatic gel designed to control severe bleeding in patients with traumatic injuries. The product can be applied directly to a patient’s injury, temporarily stopping bleeding from gunshot wounds or other massive injuries. The company plans to bring the product to market later this year and intends to manufacture it for the U.S. military, government health agencies and emergency medical providers.
The federal government unveiled that its months-long negotiations with drugmakers will save Americans $7.5 billion in its first year, slashing the prices of a handful of medications developed by local pharma companies.
The negotiated prices, set to take effect in 2026, were determined under the U.S. government’s Medicare drug price negotiation rule, passed under the Inflation Reduction Act. The rule marks the first time the government has had the authority to negotiate drug prices with pharmaceutical companies, setting officials on a hopeful path to drive down sky-high medication costs.
The rule is expected to save Medicare $6 billion once it goes into effect, and reduce out-of-pocket costs for older Americans by $1.5 billion.
U.S. health officials negotiated savings between 38% and 79% for the top 10 most costly drugs paid for by Medicare, deriving a bulk of those savings from medications manufactured by local companies including Bristol Myers Squibb, Pfizer, Merck and Johnson & Johnson.
The negotiated prices will impact how much Medicare pays for drugs, and could potentially influence prices paid by private insurers. President Joe Biden and Vice President Kamala Harris announced the savings at an event in Maryland on Thursday, touting the Democratic party’s health care achievements ahead of the upcoming presidential election.
The price of a 30-day supply of Merck’s diabetes drug Januvia will be cut by 79% under the new program, cutting the drug’s listed price from $527 to $119. Johnson & Johnson’s blood thinner Xarelto will also be discounted by 62%, bringing its new maximum price to $197, according to the U.S. Centers for Medicare and Medicaid Services.
The federal government has also agreed to cut the prices of higher-cost drugs, such as Johnson & Johnson’s Stelara, a biologic that treats autoimmune diseases like psoriatic arthritis and Crohn’s disease. The current price of a 30-day supply of Stelara is nearly $14,000, but will be slashed by 66% to $4,695 under the new program.
Eliquis, a blood thinner that is co-developed by Bristol Myers Squibb and Pfizer, will sell at a maximum fair price of $231 for a 30-day supply — more than half off its initial price, according to federal officials.
Pharmaceutical companies have fiercely opposed the changes, filing a flurry of lawsuits claiming that the federal government’s program was unconstitutional. But most of those lawsuits were dismissed after federal judges deemed them constitutional.
Bristol Myers Squibb said in a statement Thursday that the maximum pricing for Eliquis “does not reflect the substantial clinical and economic value of this essential medicine,” which is used to reduce stroke-related events and hospitalizations.
A spokesperson from Johnson & Johnson said that the drug pricing law's "arbitrariness and lack of standardized scientific approach in evaluating clinical evidence undervalues the benefit our medicines deliver to millions of patients. "
The state will invest $646 million to boost the health care workforce using a long-sought Medicaid waiver program to promote health care access and reduce disparities in underserved communities.
Three workforce development organizations will be paid to recruit and train thousands of health, mental health and social workers over the next three years, Gov. Kathy Hochul announced Thursday. The Career Pathways Training Program is the first major workforce development spending to be announced under the $7.5 billion Medicaid pilot program, known as the 1115 waiver.
New York secured the federal waiver in January after a multi-year push, allowing the state to use Medicaid dollars in new ways to address social determinants of health, distressed hospitals and severe workforce shortages. The state is moving quickly to allocate the funding, which expires in March 2027. Last week, money began flowing to nine social care networks, which are tasked with screening New York’s 7 billion Medicaid recipients, enrolling them in services and funneling additional tax dollars to housing, nutrition and transportation support.
Providers in New York and nationally have faced a crunch of health care workers as high attrition during the pandemic forced hospitals and long-term care facilities to stretch resources and shutter programs. Hochul has made worker recruitment and retention a hallmark of her public health agenda. Since 2022, the state has paid over $2 billion in bonuses to 800,000 health care workers through the Health Care Worker Bonus. Other funding has gone to tuition forgiveness and mental health training.
The new investment will be divided among 1199SEIU Training and Employment Funds and two upstate networks, Iroquois Healthcare Association and the Finger Lakes Performing Provider System. The organizations will be responsible for providing tutoring and apprenticeships, tuition and textbook support and job placements.
The money comes with requirements to report performance metrics and spending information, according to the governor’s office. Participants must make a three-year commitment to providers from whom at least 30% of their clients are Medicaid recipients or uninsured.
The exact breakdown of the funds is in the process of being finalized, said Sam Spokony, a spokesman for the governor.
Mayor Eric Adams was subpoenaed as part of a corruption probe by the Justice Department, the New York Times reported.
Attorneys for Adams, who said they’re in the process of responding to the subpoenas, said they continue to cooperate with the investigation and expect a prompt and just resolution. Brendan McGuire and Boyd Johnson, who are partners at WilmerHale, said they’ve conducted their own investigation “of the areas we understand the U.S. Attorney’s Office has been reviewing” and that “we have not identified any evidence of illegal conduct.”
The Times reported that subpoenas were also served to City Hall and Adams’s election committee, and that they seek information into a range of areas including the mayor’s travel and fund raising.
A spokesman for the U.S. Attorney for the Southern District of New York declined to comment.
“As a former member of law enforcement, the mayor has been clear over the last nine months that he will cooperate with any investigation underway,” Fabien Levy, a spokesman for Adams, said in a statement. “Nothing has changed. He expects everyone to cooperate to swiftly bring this investigation to a close.”
While the extent of the probe is unclear, the Times has reported that investigators are looking at a so-called straw donor scheme involving the Turkish government or Turkish nationals in which contributors listed for Adams’s 2021 mayoral campaign weren’t the actual source of the money.
They’re also examining whether Adams pressured the Fire Department to expedite the opening of the Turkish consulate’s 35-story tower in time for the United Nations General Assembly in September 2021, the Times has reported. That was after Adams, who was then the Brooklyn borough president, won the Democratic primary but before he had won the general election in November.
The federal investigation became public in November after Federal Bureau of Investigation agents executed a search warrant at the Brooklyn home of Adams fundraiser Brianna Suggs. They were seeking information about whether Adams’s campaign had taken illegal foreign donations from contributors with ties to the Turkish government, the Times reported.
The City Council on Thursday approved a plan to allow new housing and commercial activity along 46 blocks in the East Bronx — the first neighborhood-wide rezoning to pass under Mayor Eric Adams, and effectively a trial run for the City of Yes housing plan that he will try to push through the council later this year.
The Bronx plan focuses on the area surrounding two of the four new Metro-North train stations set to open in 2027 as part of a plan by the Metropolitan Transportation Authority to bring the commuter rail service to Penn Station for the first time. The rezoning would permit some 7,000 new homes in neighborhoods like Parkchester, Van Nest and Morris Park. It will permit apartment buildings on blocks where only industrial uses and small homes are currently allowed.
“It’s not every day that you see a new station, much less four, coming to a community without great transit service, and the current zoning around some of these stations allows virtually no new housing today,” City Planning Director Dan Garodnick said in an interview. “So we are very excited about this outcome for the Bronx and for the city.”
To win support for the plan, the Adams administration had to persuade the three council members whose districts cover the rezoning area — especially newly elected Republican Kristy Marmorato, who ran for office on an anti-development platform. Through negotiations, the administration committed $500 million in new infrastructure upgrades for the East Bronx, including $119 million to renovate playgrounds and parks, $189 million to repair streets, and $170 million for sewers, water lines and catch basins.
Marmorato also prevailed on the administration to require that new buildings in the rezoned area each include a minimum number of parking spaces. That, combined with density reductions near the future Morris Park station, means the rezoning will produce about 500 fewer apartments than the city had initially projected. (About 1,700 of the newly created homes will be considered affordable.)
The deal may be a preview of the concessions Adams will need to make when the City Council votes this fall on his City of Yes housing plan, which would relax zoning rules in the name of allowing more development — especially near train stations in the outer boroughs. That plan also calls for eliminating parking mandates for new residential buildings citywide, a prospect that some lawmakers oppose.
Council sources have told Crain’s in recent weeks that lawmakers are likely to make a push for major citywide capital improvements in exchange for passing City of Yes, to ease fears that local infrastructure might be strained by the estimated 109,000 new homes the plan could create over 15 years. The City Planning Commission is now considering the wide-ranging zoning proposal and will refer it to the council sometime in September.
“Key components of what the mayor wants would eventually be palatable,” one council member said this month. “But without these infrastructure investments, that’s going to be a hard sell.”
Negotiations on the Bronx Metro-North rezoning were difficult and only came together at the last minute, as Council Speaker Adrienne Adams urged Marmorato to stay open to a potential compromise, a person with knowledge of the talks told Crain’s.
“Our intention when it comes to great projects for the city is always to get to a yes,” Speaker Adams said at a press conference before Thursday’s vote.
Marmorato, in a statement, said the final deal “balances housing needs while preserving the character of our neighborhoods.”
Besides allowing housing, the Bronx plan will change commercial uses to foster more job-generating industries including the life sciences and medical offices. City officials say that 1.23 million square feet of commercial space could create as many as 10,000 new permanent jobs.
The rezoning does not make any significant changes to the blocks surrounding two of the other new Metro-North stations, in Hunts Point and Co-Op City.
The Bronx plan is the first neighborhood-wide rezoning to be passed under Mayor Adams, with other proposals in Long Island City, Jamaica and Midtown South still under review.
Mayor Adams explicitly tied the Bronx plan’s approval to the coming fight over his housing package — which, if passed, will be the third of three citywide zoning reforms under the City of Yes banner to be approved by the Council.
“The Bronx is saying ‘yes’ to more housing in our backyards, communities and neighborhoods, and serving as a model to the rest of our city on how to lead from the front,” Adams said.
Starbucks' primary corporate home is Seattle.
Yet its freshly minted chief executive isn’t living in the same city or even state as its headquarters — an emerging trend of top leaders living a plane ride away at a time when many employees are forced to return to the office.
Indeed, this week Victoria’s Secret, based in Columbus, Ohio, named a new CEO who will be in New York.
Brian Niccol, the new CEO of Starbucks, won’t be required to move to Seattle, where the company is based, even though he’ll be spending much of his time there. He is also getting a remote office in Newport Beach, California, where his former employer Chipotle Mexican Grill is located. Hillary Super, who was poached from Rihanna’s lingerie brand to be the next leader at Victoria’s Secret, will be moving from California to live in New York.
Both executives have agreed to commute frequently for their role. Starbucks will allow Niccol to use its corporate plane, and Victoria’s Secret will cover Super’s travel expenses.
They are joining the growing ranks of corporate leaders being given the option to run their businesses from hundreds or thousands of miles away, at least some of the time.
Kelly Ortberg, who became Boeing's CEO this month, will be based in Seattle — near much of the company’s production — rather than its corporate headquarters in Arlington, Virginia. United Airlines Holdings’s Scott Kirby splits his time between his primary residence in Dallas and Chicago, where his company is based.
That’s a stark contrast to corporate employees, many of whom are facing a return-to-office mandate.
White-collar employees at Starbucks, for example, were required at the beginning of last year to return to the office at least three days a week, a move that sparked backlash from some workers.
Some Victoria’s Secret employees are in the office, while others are allowed to work remotely. Super isn’t the first or only senior executive at her company to be based outside of Ohio. The company’s brand president and head of design both live in New York.
“We have headquarter offices in many locations, including New York,” a Victoria’s Secret spokesperson said in a statement. “For us, what’s most important is that our teams feel supported no matter where they are based.”
Super’s predecessor, Martin Waters, was also based in New York and would visit the Ohio facilities frequently.
Niccol, who moved Chipotle’s headquarters from Denver, isn’t following precedent at Starbucks. The coffee chain’s previous CEO, Laxman Narasimhan, relocated to Seattle from the U.K. Niccol will spend the majority of his time at the Seattle headquarters, according to a Starbucks spokesperson.
Mount Sinai’s financial turmoil has hit its credit rating as it struggles to close Beth Israel Hospital, a facility it says is hemorrhaging cash. The downgrade points to the likelihood that the system’s fiscal challenges won’t let up any time soon.
Credit ratings firm Moody’s downgraded Mount Sinai Hospital’s debts by two notches on Wednesday, pointing to concerns about the health system’s dwindling cash reserve. The agency revised Mount Sinai’s credit outlook to “negative,” indicating that the health system is likely to continue losing money in the coming months and may face challenges repaying its debts.
Mount Sinai’s losses are largely tied to its inability to close Beth Israel Hospital on the Lower East Side, according to the credit ratings report. Not only did it take Mount Sinai longer than expected to get the state’s approval for the closure, but it also faces an ongoing lawsuit that potentially stands to tie the closure up in court for the foreseeable future.
The hospital’s inability to close Beth Israel has likely forced it to burn through its cash, said Dr. Ge Bai, a professor of accounting and health policy at Johns Hopkins University in Baltimore.
“It’s a huge drag on their performance,” Bai said. “The best thing to do is stop the bleeding.”
It’s not clear when Mount Sinai will be able to reduce losses of $150 million a year that it takes to keep Beth Israel open, Lisa Martin, senior health care analyst at Moody’s, wrote in the report, projecting that the health system’s cash will decline even further over the next year.
Mount Sinai’s cash flow has also suffered from continued disruption in collecting payments for medical services because of the Change Healthcare cyberattack, increasing financial support to its medical school and a generally worse-than-expected operational performance, according to Moody’s. The hospital had $1.8 billion in debt by the end of last year.
Moody’s downgraded Mount Sinai’s credit rating to Baa3, just one level above bonds considered “junk.” Junk bonds are riskier and have higher interest rates because issuers are less likely to be able to repay their debts.
Mount Sinai is addressing its recent fiscal challenges with a financial improvement plan, said Loren Riegelhaupt, an external communications consultant who represents the health system. The annual savings from the closure of Beth Israel is “a key element” of that plan, he said.
Mount Sinai has been pushing to close Beth Israel since last September, stating that it loses more than $150 million each year to keep the hospital up and running. The health system planned to shut down the hospital by July, but the closure was delayed by pending approval from the state Health Department and an ongoing lawsuit brought by community members and advocates.
The health system got the green light from the Health Department to close Beth Israel last month, and a few weeks later, a state judge dismissed the lawsuit, clearing a potential pathway for the closure. But advocates mounted a last-ditch legal attempt earlier this week that has kept Beth Israel’s closure date in limbo.
Federal regulators have ordered the Metropolitan Transportation Authority to improve its safety practices in the subway after finding an increase in close calls where riders were nearly struck by trains over the last three years.
A review released Wednesday by the Federal Transit Administration said it discovered an “escalating pattern of safety incidents and concerns” at the MTA’s New York City Transit with 228 "near-miss events" that could have caused customer injury or property damage, occurring in the subway in 2023, up 3% from 2022 and up 46% from 2021, the report highlights.
For transit workers, 38 near-miss incidents occurred on the tracks last year — a 58% increase from 2022, and a 65% increase compared to 2021. Half of the close calls for MTA employees involved one or more transit workers failing to follow proper procedures while flagging — the safety practice of workers using flags and lights to alert track crews to the presence of trains.
Indeed, the FTA launched the probe into safety failures after a Nov. 29 incident in which a D train struck and killed track worker Hilarion Joseph who was on flagging duty near the 34th Street-Herald Square station. And also after the June 6, 2024 incident in which another flagger was struck by an F train near the Hoyt-Schermerhorn stop in Brooklyn.
The FTA noted that near-misses involving a train or a right-of-way operation for customers and property damage occurred for reasons including third-rail explosions, train doors opening on the wrong side of a train with no platform access and trains reversing or operating on the wrong rail without authorization. The FTA didn’t highlight specific instances in its report.
MTA officials have raised a similar alarm about an increase of what the agency calls track trespassers, which refers to unauthorized entry onto the tracks, and in 2022 launched a task force focused on addressing the issue.
The FTA said it mandated subway safety assessments to improve protcols after the agency determined that “a combination of unsafe conditions and practices exist such that there is a substantial risk of death or personal injury,” wrote FTA Executive Director Matthew Welbes.
If the MTA fails to deliver the FTA could withhold funding to the agency and direct the agency to use federal dollars to address safety issues.
The MTA has disputed the FTA’s findings and said it intends to appeal. New York City Transit already has extensive safety protocols and investigates close calls to determine how the agency can improve its existing practices, wrote Demetrius Crichlow, interim president of New York City Transit, in a response letter to the audit.
“In short, we strongly dispute FTA’s view that NYCT has somehow been negligent when it comes to addressing the safety of track workers, one of our most essential priorities,” Crichlow wrote in a letter reviewed by Crain’s. Crichlow added that the two worker incidents that prompted the probe remain under investigation by the National Transportation Safety Board. He also noted that the FTA’s review partially included the Covid-19 pandemic which limited construction in the subway and could have factored into the increase.
The FTA’s audit also took aim at the state’s New York Public Transportation Safety Board for what it said was lax oversight of the MTA. Between 2013 and 2024, the FTA allocated more than $22 million to the board to conduct safety oversight, but the FTA said that $8.1 million hasn’t been spent to improve oversight of the MTA and other transit agencies in the state.
A veteran Brooklyn restaurateur is venturing across the East River for the first time in his more than 20-year career to open an eatery in NoMad next month.
Andrew Tarlow, who runs half-a-dozen neighborhood establishments in north Brooklyn as part of his hospitality company the Marlow Collective — including Diner, Marlow & Sons, Achilles Heel and Roman's — is set to open Borgo at 124 E. 27th St. at the end of September in the space of what was formerly the Italian restaurant I Trulli for more than 20 years.
Tarlow's first restaurant, Diner, opened in Williamsburg on New Year's Eve 1998, and has become known for popularizing the farm-to-table-type fare that has since proliferated throughout the borough.
Borgo, what Tarlow is calling a continental trattoria, is his first new restaurant in 10 years. He pounced on the space after I Trulli closed in 2022, Borgo spokesman Jay Strell told Crain's.
The Marlow Collective's latest addition will sit on the ground floor of a 4-story NoMad building, between Park and Lexington avenues, with eight walk-up apartments above it — one of which, a studio, is available for rent for just under $3,000, according to StreetEasy.
The building's owner, David Magier of Manhattan-based Harlington Realty, bought the property in 1999 under the limited liability company Fundamental Realty, according to city records, but it's unclear how much he paid as it was before the city's current method of record-keeping. Magier did not respond to a request for comment.
Strell declined to say how much Tarlow is paying in rent for the restaurant — which features 140 seats, two great rooms connected by an open hearth, an open kitchen with a wood-burning oven, and a garden in the backyard. According to a recent report from commercial broker JLL, however, commercial rents in the neighboring Flatiron District went for an average of $248 per square foot during the first quarter of this year.
News of Tarlow's acquisition started making the rounds earlier this year, when Eater reported on the NoMad lease signing.
According to Strell, Borgo's kitchen will be run by Chef Jordan Frosolone. The trattoria's wine director will be Lee Campbell, its front of house manager will be Marlow Collective veteran Jason Schwartz, and the general manager is Rashaad Jones, a former captain at Eleven Madison Park.
Leases
Moinian inks Columbus Circle lease with investment firm
Address: 3 Columbus Circle, Manhattan
Landlord: The Moinian Group
Tenant: Night Squared
Lease size: 3,874 square feet
Lease length: Five years
Asset type: Office
Brokers: Spaces Commercial Real Estate's Lance Leighton represented the tenant. CBRE represented the landlord.
Sales
Union Square mixed-use building trades hands
Address: 862 Broadway, Manhattan
Seller: ASB Real Estate Investments
Buyer: Shulsky Properties
Sale price: $12 million
Asset type: Mixed use
Financings
Norwood commercial lot lands loan
Address: 3551 Webster Ave. and 3547 Webster Ave., Bronx
Owner: Rivky Brach
Lender: Bridge City Funding
Loan amount: $26.5 million
Asset type: Mixed use
New Jersey Transit will make train and bus rides free for one week this month, after commuters suffered through a spate of service delays and cancellations this summer.
Gov. Phil Murphy said Thursday that fares will be waived on all the agency’s modes of transit from Aug. 26 through Sept. 2 as a thank-you to customers. NJ Transit riders who use a monthly pass will automatically get a 25% discount on their September purchase, according to Murphy’s office.
The reprieve is a way to “express the sincere appreciation for customers’ continued loyalty and patronage, particularly during a time when transit service has not consistently met their expectations—or our own,” said Murphy in a statement.
The NJ Transit fare varies depending on the destination, but a one-way fare between Princeton Junction and Penn Station in New York costs $18.40. The monthly passes on the Main and Bergen County lines to New York City run between $77 and $304.
The fare holiday comes after a summer of rail delays stemming from multiple infrastructure meltdowns that snarled commutes. NJ Transit and Amtrak officials are in the midst of equipment and infrastructure inspections along 170 miles of track and at stations between New York City and Trenton, New Jersey, to address the causes behind the problems.
The Northeast corridor, through which some 500,000 travelers commute each day on their way to Penn Station on Amtrak, NJ Transit and Long Island Rail Road trains, have seen the brunt of the issues.
Though commuters may be excited for a week of free rides, some members of New Jersey's business community are not. Michele Siekerka, the president and chief executive of the New Jersey Business & Industry Association, said the fare holiday is a frustrating slap in the face to area businesses that had their corporate taxes recently increased to support NJ Transit’s budget. The fare reprieve “wholly disregards the latest hit our business community just took on competitiveness,” said Siekerka.
“New Jersey businesses aren’t asking for a free ride. But they are asking for fairness,” Siekerka added.
Rybak Development has landed $52 million in construction financing for a luxury condo project it is planning in Midtown East.
The company, based on Coney Island, purchased 660 Lexington Ave., also addressed as 133 E. 55th St., in late 2021 for roughly $24.4 million and is planning an 18-story, 31-unit luxury condo development at the site. The project currently stands 12 stories tall and will include 2,460 square feet of retail space and 1,272 square feet of ground-floor community facility space as well.
A joint venture of Rybak and Gravesend-based BK Developers secured the funding from Manhattan-based lender Emerald Creek Capital, according to an announcement from JLL. A team at the brokerage led by Robert Tonnessen and Aaron Niedermayer represented Rybak and BK in the deal, which was first reported by the Commercial Observer.
"This is the construction loan that's going to help us get to the finish line," said Rybak founder and principal Sergey Rybak.
The developers hope to start sales at the project during the fourth quarter of 2025 and finish work on it during the first quarter of 2026, Rybak said. Prior plans indicated the project would include a restaurant and health care facility, but Rybak said this is no longer the case, and he is still unsure what will go in the retail and community facility spaces. The project will also feature amenities such as a spa and a fitness center.
Rybak was founded in 2007 and is an extremely active developer in the city with a portfolio of about 20 projects. These include a 10-story development at 502 E. 81st St. on the Upper East Side with nine residential units and an 11-story development at 218 Madison Ave. near the Morgan Library in Midtown South with between 24 and 28 residential units.
Top New York Democrats crammed into a Harlem event space on Wednesday to rally behind Kamala Harris’ presidential campaign — and they betrayed some anxiety about the Empire State’s unfamiliar status as a political battleground.
“The nation is watching us and expecting us to deliver the United States House of Representatives,” Gov. Kathy Hochul told attendees, alluding to the state's half-dozen swing House seats that could decide control of Congress.
Mayor Eric Adams, Manhattan Congressman Adriano Espaillat and a slew of other elected officials all attended the unofficial “kickoff” event for the vice president and her running mate, Tim Walz. The rally, organized by Upper Manhattan Democratic leaders, was not an official campaign event, but still managed to attract top elected officials eager to unload some pent-up energy.
“It doesn’t matter that I primaried you last year or you primaried me the year before — that does not matter, that’s inconsequential,” said Espaillat, one of several speakers who delivered a message of Democratic Party unity.
A large contingent of pro-Palestine protesters lined the block directly across from the event space, and a few who snuck inside the venue interrupted several speakers. Adams, seeking to drown out one protester, led the crowd in chants of “Make sure you vote.”
The mayor made no references to former President Donald Trump in his remarks, instead playing up Harris’ biography.
“No matter who you are and no matter what you think you don’t like, you are going to be better [off] with a woman who was raised by a single mom,” Adams said. “She knows the battle.”
A mishmash of political ambitions was on display at the event. Queens State Sen. Jessica Ramos, who may challenge Adams for mayor, stood right next to him on the dais. City Council Speaker Adrienne Adams appeared a few feet from Julie Menin, a Manhattan Councilwoman who may run to replace her as the body’s leader.
Speaker Adams told attendees that even New Yorkers should not feel complacent about Democrats’ chances.
“For those of you that don’t know, parts of New York City are battlegrounds, y’all,” she said. “We’ve got to fight right here to win our own state.”
For Ellen Hart, nostalgia is presented through show tunes with a side of fries.
Hart is the owner of Ellen’s Stardust Diner, a 1950s-themed eatery in Times Square where patrons order burgers and shakes as waiters burst into tunes from the American songbook while standing on banquettes above them. And through the years, that singing staff, known as Stardusters, has turned the small restaurant on Broadway into as much of a destination for fans of musicals as some of the large stages nearby.
Though the act may be decades-long, it does not appear to be getting old. On a recent afternoon so steamy that merely stepping outside seemed hazardous to one’s health, a line stretched from the Stardust’s front door halfway down West 51st Street. Indeed, the 200-seat space at 1650 Broadway can pack in up to 3,500 customers a day — a truly hot ticket in town.
If the fans are hardy, Stardust’s figurehead is too. Hart, 83, still shows up for work several times a week and even sometimes grabs a microphone for standards such as “Getting to Know You” from Rodgers and Hammerstein’s The King and I. But the restaurant’s soundtrack isn’t stuck in the Eisenhower era. More-modern ditties belted out by Stardusters while they stand under a disco ball and sometimes amid falling confetti include “Grease,” Cher’s “Believe” and Tina Turner’s “Simply the Best,” with generous helpings of Taylor Swift served up as well.
“This is food and a show at a decent price,” said Hart, who also owns jazz and blues club The Iridium downstairs. “We don’t always know what the magic ingredient will be, but it always seems to work out very well.”
A native of Queens, Hart moved to the Nyack, Long Island, area in the 1950s to raise a family but also managed to enjoy some turns in the limelight along the way. There were singing gigs at bungalow colonies in Rockland County; a local regional theater cast her as Linda Loman in Death of a Salesman. And the 1980s found her regularly performing the “Star-Spangled Banner” at Madison Square Garden before Knicks and Rangers games. (“It was very nerve-wracking to go out there in the middle of those crowds,” she said.) And she also hiked up the stairs of the 102-story Empire State Building to support multiple myeloma at the age of 72.
But there were dissonant notes along the way, like the 2010 death of husband Irving Sturm, who was also her longtime business partner. In 1970 the couple founded Ellen’s Cafe, a coffee shop near City Hall frequented by politicos, who nibbled on sandwiches such as the Fabulous Fiorello, as in 1930s Mayor Fiorello La Guardia. But a condo conversion of their Chambers Street building forced Hart and Sturm to close there in 2001.
At the time the couple also owned their first Stardust, on Sixth Avenue in Midtown, a sort of dry run for the current version. Although that premier location did not offer any singing wait staff, it also sported ’50s decor, inspired by a trip to a retro-style restaurant in Southern California. “We had a bunch of Elvis Presley photos on the walls, but it was all very kitschy,” Hart said.
In 1995 Hart and Sturm relocated the Stardust westward, to the present address at the heart of the Great White Way. An early karaoke session that prompted a dining room sing-along informed the current business model.
Some of the couple-dozen Stardusters, who must audition for the job as if it were a stage show, occasionally move on to bigger audiences. Former waiter Marla Mindelle, for instance, scored a lead role in the musical Titanique—an accomplishment that her former employer honored by slapping her name on a banana float.
Perhaps the diner’s biggest challenge came during Covid; a pandemic marked by breath-borne pathogens wasn’t exactly a great fit for a place where strangers sing near plates of food.
“We had to close for a year and a half, lost a lot of revenue, and there was a point where we didn’t know if we would ever open again,” said Hart, who added healthier options to her menu afterward, including quinoa bowls, though burgers and beer remain crowd favorites. “We interpreted the old with the new,” she said, a description that could also easily apply to Hart’s career.
Elmhurst Hospital is planning to open a long-stalled pediatric intensive care unit and expand its women’s health clinic with the help of $27.5 million from New York State.
The new funding includes $7.5 million to build a 1,500-square-foot PICU, a project that has failed to launch in the past despite a $3 million commitment from Borough President Donovan Richards in 2021. Another $20 million will go toward more than doubling the size of Elmhurst’s Women’s Pavilion, adding three more floors and more clinical services.
Elmhurst Hospital does not currently have a PICU. Last year, 600 children had to be transferred from Elmhurst to other hospitals, according to CEO Helen Arteaga-Landaverde.
The safety net hospital is a critical care provider in a predominantly low-income section of Queens, last year serving 1.1 million patients, most of whom are uninsured or on Medicaid.
The latest announcement comes after a previous plan to build a PICU failed to launch. In 2021, hospital administrators announced the planned construction of a $12 million unit, with the help of $3 million earmarked by Richards, along with $2.5 million to enlarge two operating rooms. That funding was allocated to the hospital, according to Chris Barca, a spokesman for Richards. New York City Health + Hospitals, which includes Elmhurst, did not respond to inquiries about why the $12 million PICU never materialized.
Maternal mortality has been on the rise since the pandemic, with pregnancy-related deaths increasing 33% between 2018 and 2021, according to data from a state Comptroller’s audit that found public health agencies failed to stop preventable deaths. Racial disparities have also worsened, with Black people several times more likely to die due to pregnancy complications than White people, the audit showed.
The pregnancy rate in the highest poverty neighborhoods was 1.7 times higher than in the most affluent parts of the city, according to the Health Department’s vital statistics report.
“Getting pregnant if you’re a woman of color can be a death sentence,” said Gov. Kathy Hochul at the announcement in Queens on Wednesday. The governor called the rates of death among Black pregnant people “disgraceful.”
The new women’s health clinic will offer general obstetrics and services for high-risk pregnancies. It will also provide new services for pelvic floor disorders, gynecological cancers and breast health, and postpartum depression.
Elmhurst Hospital has not released a timeline of when the new projects will be completed.
The new funding is not the first planned expansion of maternal health services announced by Elmhurst or other hospitals in recent months.
In June, the Health + Hospitals board of directors approved construction on a $13 million gut renovation of a 15,000-square-foot labor and delivery suite at Elmhurst. That work is expected to be completed by October 2026, according to hospital administrators.
Earlier this month, NYU Langone announced a $28 million planned expansion of its pediatric intensive care unit earlier this month. That development followed $11 million planned ambulatory care hub at NYU’s Pediatric Congenital Heart Center nearby.
THERAPY INVESTMENT FOR CITY WORKERS: The Department of Health and Mental Hygiene is spending $6.1 million on therapy for client-facing staff at the city’s Cure gun violence prevention programs. The funding will go to Koreatown-based Agape Moments to provide the therapy under the department’s Stronger Messenger Program. The money is intended to support the mental health and emotional stability of 250 Cure Violence workers across 31 sites.
MPOX EMERGENCY DECLARATION: The World Health Organization has declared mpox a public health emergency of international concern after rates have surged across central and eastern Africa in recent months. The elevated levels are driven by clade I, a different variant than the strain that triggered a global outbreak in 2022. While clade I has not been identified in the United States, public health officials in New York warn it can be introduced by travelers to countries where it is active and believe the available JYNNEOS vaccine will be effective against the strain. Mpox rates in New York City spiked last fall and have remained high this year compared with 2023. The city Department of Health and Mental Hygiene conducts outreach and vaccination efforts, but could not say what is behind the higher infection rates.
INVASIVE MENINGOCOCCAL DISEASE: The New York State Department of Health directed providers to stop using the antibiotic ciprofloxacin to treat diagnosed or suspected invasive meningococcal disease because of an increase in bacterial resistance to the drug. The department instructs providers to instead prescribe rifampin or ceftriaxone to people who have been exposed to the disease. Invasive meningococcal disease is a rare infection that can cause brain swelling, and blood and joint inflections, and is fatal in 10-15% of cases, according to the Health Department.
Biotech company MindMed is shoring up its cash stockpile to inch its psychedelic therapies towards approval after the feds’ recent thumbs-down of using MDMA to treat post-traumatic stress disorder.
The Midtown biotech firm completed a public offering Tuesday, selling additional shares worth $75 million to boost its cash reserves. The new funding adds to MindMed’s existing $241 million stash, according to second quarter financial results published by the firm on Tuesday.
“This additional financing positions us to rapidly advance our R&D pipeline,” said Rob Barrow, CEO of MindMed, adding that the company plans to share the results of several clinical trials by early 2026.
Asked whether the company believed the results of the 2024 election could impact MindMed’s research efforts, Barrow said “there is broad bipartisan support for psychedelic research and innovation.”
MindMed, which is exploring the use of psychedelic therapies for conditions including anxiety, depression and autism spectrum disorder, is still in the discovery phase, and thus has no revenues from its existing products. Founded in 2010, the firm went public four years ago.
The company assured its investors that its cash reserves will hold it over as it races to bring treatments to market. Barrow said that the new funding extends the company’s cash runway into 2027, one year after it plans to share results from a phase 3 clinical trial of LSD for generalized anxiety disorder.
The financing comes just a few days after the U.S. Food and Drug Administration rejected a new psychedelic treatment for PTSD. The FDA determined that it needed more data from late-stage clinical trials before it could approve the use of MDMA, or ecstasy, for PTSD.
Drug manufacturer Lykos Therapeutics, based in San Jose, Calif., said it planned to request a meeting with the FDA to ask the agency to reconsider its decision, noting that an additional phase 3 clinical trial could take several years.
The decision was widely seen as a setback for the psychedelics movement, which has gained momentum in recent years. The federal government has embraced the plausibility of using drugs like MDMA, LSD and magic mushrooms to treat mental health issues, just last year publishing research guidance for psychedelic drugmakers.
Barrow doesn’t see the recent FDA decision as a roadblock for future psychedelics approvals, stating that MindMed is excited about the agency’s commitment to research thus far.
MindMed recently met with the FDA regarding the end of its phase 2 trial for MM120, its oral LSD candidate to treat generalized anxiety disorder, Barrow said. The company is on track to start a phase 3 study later this year.
Columbia University President Minouche Shafik resigned after a tumultuous period sparked by protests over the Israel-Gaza war.
Shafik, an Egypt-born economist and former president of the London School of Economics, said that she will step down effective Aug. 14, a little over a year after starting the job.
“It has been a period of turmoil where it has been difficult to overcome divergent views across our community,” Shafik wrote in a statement. “Over the summer, I have been able to reflect and have decided that my moving on at this point would best enable Columbia to traverse the challenges ahead.”
She will be replaced on an interim basis by Katrina Armstrong, chief executive of Columbia University Irving Medical Center, the board of trustees said in a separate statement.
The simmering tensions at Columbia burst onto the global stage in the spring, when Shafik called in the New York Police Department to remove protesters who had barricaded themselves inside Hamilton Hall, a campus building where students famously staged a similar protest in 1968. More than 100 people were arrested on charges ranging from trespassing to burglary.
Until now Shafik, who also held leadership positions at the International Monetary Fund and the Bank of England, had avoided the fate of two other Ivy League presidents, Claudine Gay of Harvard University and Liz Magill of the University of Pennsylvania. They stepped down after much-criticized congressional testimony in December where they gave evasive answers about whether calls for genocide against Jews would be a violation of university policies.
Shafik, 62, testified before the same committee in April, and tensions rose on the Morningside Heights campus during the hearing. Pro-Palestinian protesters erected an encampment, and after the school called in police to remove them she faced a torrent of criticism from students and faculty.
After the arrests, the tents returned and similar encampments began to sprout up at dozens of other campuses, including Harvard, Yale, the University of Texas at Austin and the University of California at Berkeley.
Shafik replaced Lee Bollinger, who led Columbia for two decades, but was quickly forced to confront issues of free speech and accusations the university tolerated antisemitism on campus.
“I have tried to navigate a path that upholds academic principles and treats everyone with fairness and compassion,” she wrote in the statement. “It has been distressing — for the community, for me as president and on a personal level — to find myself, colleagues, and students the subject of threats and abuse.”
The watchdog agency that investigates police misconduct has been forced to drop 700 cases against NYPD officers this year as a result of budget cuts imposed by Mayor Eric Adams.
Weeks after Adams announced cuts last fall, leaders of the Civilian Complaint Review Board said that the sudden funding shortfall would force it to suspend eight different categories of investigations into police misconduct starting in January 2024 — including claims of officers making false statements, refusing to provide their names or shield numbers, making threats, using discourteous words or seizing civilians’ property. The latest figure of 700 closed cases in 2024 is according to CCRB’s public complaint database, where it labels each case that was suspended due to budget cuts.
“We do not have enough funds to investigate all the complaints within our jurisdiction,” CCRB Chair Arva Rice testified at a March City Council hearing.
Rice is resigning as the board’s chair effective Thursday, after spending months vocally opposing the mayor’s funding reductions.
The cut that Adams imposed across most departments in September 2023 would have reduced CCRB’s budget by about $3 million to a total of $25.4 million for the coming year, and city agencies began implementing the reductions soon after the mayor announced them. Rice testified in March that the CCRB, which has long been hobbled by limited powers and slim staffing, actually needed a budget of $38 million “to function as a truly independent police oversight agency.”
In the end, the CCRB’s budget grew slightly, to $27.8 million, under the latest city spending plan passed in June. Agency spokeswoman Clare Platt suggested Wednesday that the hampered oversight will not be permanent.
“In response to a proposed budget cut in September 2023, the CCRB had to strategically allocate resources in order to ensure every investigation continued to be thorough and up to the same standard that New Yorkers deserve,” Platt said in a statement. “The agency's budget has since been restored, and we are in the process of hiring and training staff so that we can resume investigating all complaints within the CCRB's jurisdiction.”
The NYPD’s budget for Fiscal Year 2025 is $5.8 billion, about the same as last year’s.
The hundreds of complaints that CCRB closed as a result of the budget cuts stem from incidents that date back as far as 2022. In one such case, a Black woman in her sixties accused an officer of using discourteous language during a 2023 arrest in East Harlem. In another, a white man in his forties accused a lieutenant of having him forcibly hospitalized after a March 2024 incident in southern Brooklyn.
Mayor Adams, a former police captain, has not shown concern about how the CCRB’s work might be impeded by the budget cuts. Earlier this month, when a reporter asked whether the CCRB might now be unable to investigate a claim that a senior police official had intimidated a journalist, the mayor asserted that “there is no budget cut in the history of the city that would stop people from determining if a police officer operates inappropriately.”
“Don’t let anyone tell you that,” Adams said at a press conference. “There are always avenues.”
The CCRB received 2,800 complaints in the first six months of 2024 that were within its jurisdiction — the most in the first half of any year since 2012, according to a semiannual report released this week.
Meanwhile, the city has paid out $82 million in settlements from lawsuits alleging police misconduct from January through July of this year, according to a tally released Monday by the Legal Aid Society. That seven-month total is higher than the city’s entire settlement costs for 2018, 2019 and 2020, and put the city on track to rack up $140 million in payouts by the end of 2024 — up from $115 million last year.
The MTA is investing $16 million to send another 500 private security guards into the subway with the sole purpose of deterring fare evasion through the system’s emergency exit gates.
Over the next year transit officials are doubling the number of unarmed guards contracted with Pennsylvania-headquartered Allied Universal to 1,000, bringing the agency's private security spending to $35 million through 2024 and into next year, according to MTA budget documents.
The guards do not issue summonses or make arrests, said the MTA. Instead they linger near emergency gates at a rotation of stations and verbally discourage would-be evaders of the $2.90 fare; they may also call police to intervene. It’s up to NYPD officers, whose presence has also recently increased in the subway, to issue summonses or make arrests.
Transit officials have positioned the authority’s growing reliance on private security guards as a short-term strategy to capture fare revenue while the agency explores how to modernize all 1,000 entrances into the system’s 472 subway stations. The MTA said it estimates that fare evasion fell between 20% and 30% at 50 initial stations where it deployed the guards in 2022.
The MTA declined to share figures on how much the guards may be saving the agency in fare revenue.
MTA board Chair and Chief Executive Janno Lieber has called the practice of entering the system through unpaid emergency gates the “superhighway of fare evasion.” In 2022, the MTA said subway fare evasion cost the authority $285 million, more than half of which occurred through emergency exits.
“Every time I see some rich person walk in — I’ve said it before — with an $8 latte in their hand wearing a suit and walk through the gate with their Metrocard in their hand, it burns me, and it should burn every New Yorker who cares about this system,” Lieber said during a May board meeting.
Some 13.6% of subway riders skipped out on the fare in the first quarter of 2024, according to MTA data. The figure is slightly down from the 14% who beat the fare in the third quarter of 2023 — in what amounts to the highest level of subway fare evasion recorded in five years of public MTA data.
Danny Pearlstein, the director of policy and communications at the Riders Alliance, said it's more important than ever for the MTA to bolster fare revenue in the wake of Gov. Kathy Hochul’s indefinite pause on congestion pricing, which would have generated $15 billion toward mass transit upgrades.
The June toll postponement has forced a frenzied reshuffling of the MTA’s finances. As a result, modern fare gates designed to curb fare evasion, among other investments, may be in jeopardy.
“Enforcing the fare is not free,” said Pearlstein. “You have to spend money to make money.”
Mayor Eric Adams’ administration will offer tax breaks to help two private developers convert a vacant Long Island City industrial building into a “hub” for light manufacturing like clothesmakers and technology incubators, officials announced Wednesday.
The city’s Economic Development Corp. and Industrial Development Agency will provide about $3.5 million in tax breaks toward the $14.2 million renovation of the building at 44-01 11th St., being undertaken by the Vorea Group and Mega Development.
Known as the Metropolitan Building, the century-old, four-story brick building in Hunters Point spans 45,000 square feet and was first used as an electrical parts factory. Although it has lately been advertised as a wedding venue — boasting exposed brick and wood beams — the city says the structure is vacant and in disrepair.
Under the developers’ plans, the building, which is zoned for manufacturing, will be renovated into a mixed-use facility suitable for uses like small-scale production and artist workshops. The renovation is already underway and will be completed by mid-2025, according to EDC.
The developers are financing the entire project; the city is lending support by exempting some of the building’s property taxes for 25 years, exempting sales taxes and deferring its mortgage recording tax, an EDC spokeswoman said.
The work will mostly focus on subdividing the building’s large floor plates into smaller units, while keeping historic features like its gridded windows and timber-frame structures. The renovation will also add accessibility fixes and sustainability-oriented building systems.
In statements, city officials said the project is in line with the administration’s broader plan to rezone a large swath of Long Island City — including the site of the Metropolitan Building — which would increase density and allow for some 14,000 new homes. The rezoning will start a formal review later this year and face a City Council vote in late 2025.
“The renovation of Long Island City’s Metropolitan Building offers a unique opportunity to transform under-utilized space into a mixed-use hub for both industrial and creative work,” EDC president and CEO Andrew Kimball said in a statement.
Jared Lewis, senior development manager at Queens-based Vorea, said the project would foster “a community of innovation and collaboration.”
Underlying U.S. inflation eased for a fourth month on an annual basis in July, keeping the Federal Reserve on track to lower interest rates next month.
The so-called core consumer price index — which excludes food and energy costs — increased 3.2% in July from a year ago, still the slowest pace since early 2021. The monthly measure rose 0.2%, a slight pickup from June’s surprisingly low reading, Bureau of Labor Statistics figures showed Wednesday.
Economists see the core gauge as a better indicator of underlying inflation than the overall CPI. That measure also climbed 0.2% from the prior month and 2.9% from a year ago. BLS said nearly 90% of the monthly advance was due to shelter, which accelerated from June.
Inflation is still broadly on a downward trend as the economy slowly shifts into a lower gear. Combined with a softening job market, the Fed is widely expected to start lowering interest rates next month, while the size of the cut will likely be determined by more incoming data.
“Investors and policymakers alike will find this report mostly good for markets and the economy,” said Jeffrey Roach, chief economist at LPL Financial. “As inflation decelerates, the Fed can legitimately cut rates yet keep policy restrictive overall.”
Before their September meeting, officials will get more inflation readings plus another jobs report — which will be heavily scrutinized after the disappointing July figures helped spark a global market selloff and fanned recession fears.
Fed Chair Jerome Powell and his colleagues have recently said they’re focusing more on the labor side of their dual mandate, which they’re likely to stress at their annual symposium in Jackson Hole, Wyoming, next week.
The S&P 500 fluctuated and two-year Treasury yields — the most sensitive to Fed policy — rose. Traders assigned a lower probability of a 50-basis-point cut in September.
Though the figures are reported to one decimal point by the BLS, Fed officials and economists like to look further out for a better sense of the inflation trajectory. On a two-decimal basis, core CPI rose 0.17%. And to get a feel for the recent trend, the three-month annualized figure advanced 1.58%, the lowest since February 2021.
The most disappointing part of the report was shelter prices, which economists and policymakers have been widely expecting to ease and help move inflation closer to the Fed’s target. Shelter, the largest category within services, jumped 0.4% after 0.2% in June, which was the lowest since 2021 and thought to be the start of the long-awaited slowdown.
Within shelter, owners’ equivalent rent — the biggest individual component of the CPI — also rose 0.4%. Rent of primary residence climbed 0.5%, the most since February.
Other categories were more encouraging, particularly for consumers. Prices fell last month for apparel, new and used cars and airfares. Hospital services declined by the most on record. Gasoline prices have mostly dropped in recent months.
Meantime, subscription services for video games rose by the most ever after registering a steep decline in May.
Excluding housing and energy, service prices were up 0.2%, the first increase in three months but still a tame pace, according to Bloomberg calculations. While central bankers have stressed the importance of looking at such a metric when assessing the nation’s inflation trajectory, they compute it based on a separate index.
That measure, known as the personal consumption expenditures price index, doesn’t put as much weight on shelter as the CPI does — and that’s part of the reason why the PCE gauge is trending closer to the Fed’s 2% target.
The PCE measure, released later this month, draws from the CPI as well as certain categories within the producer price index. Those parts of the PPI were fairly tame in July, and the headline figures rose by less than forecast, according to government data out Tuesday.
Part of the lower PPI reading stemmed from weaker margins at wholesalers and retailers — corroborating companies’ assertion that they’re losing pricing power as well as recent discounting and promotional activity like Amazon’s Prime Day. From restaurants to airlines, businesses recognize that consumers are growing more discerning in their spending, particularly for discretionary purchases.
A sustained decline in the price of goods over most of the past year has largely been providing some relief to consumers. So-called core goods prices, which exclude food and energy commodities, fell by the most since the start of the year. On an annual basis, they dropped by the most since 2004.
A separate report Wednesday that combines the inflation figures with recent wage data showed that real earnings growth decelerated in July from a year ago.
The condo board at Trump Palace is taking its ground-floor retail tenants to court over what the board claims is the "reckless disregard" with which they have been doing construction at the Upper East Side building and the "substantial and ongoing damage" they have allegedly caused.
Residents of the 283-unit condominium at 200 E. 69th St. are seeking a temporary restraining order and at least $1.5 million in damages from national retail company Regency Centers — which owns the commercial unit at the base of the 55-story luxury tower — and its two tenants, Whole Foods Market and discount retailer Five Below. A Food Emporium occupied the space until last year.
In a blistering lawsuit filed in Manhattan Supreme Court this week, attorney Deborah Riegel of Manhattan-based lawfirm Rosenberg & Estis argued that her client — Trump Palace's board of managers and its property management company, Orsid New York — as well as the building's more than 400 residents have been put in harm's way as a result of the defendants' supposed recklessness.
The work Regency has been doing to facilitate the imminent opening of both Whole Foods and Five Below has caused myriad issues, according to the suit.
Last month, for example, Orsid account executive Steve Lafiosca took umbrage with a "Now Hiring" sign that had been hung outside Five Below, asking Regency in an email to take it down, according to court papers.
And a week before that, amid ongoing construction, the defendants allegedly caused a gas leak in the building, between East 68th and East 69th streets, forcing its gas service to be shut down, according to court documents.
Riegel told Crain's Tuesday that her client had first attempted to mitigate the situation out of court.
"My client has tried very hard to work with them, but they have been careless and dismissive of some very basic requests — putting people in jeopardy," said Riegel, who added that the board is not looking to kick out the tenants.
Whole Foods announced with much fanfare in March that it was opening what it's calling a one-stop Whole Foods Market Daily Shop in roughly 9,000 square feet of space at the Regency-owned unit, which has an alternate address listed as 1175 Third Ave. And news of Pennsylvania-based Five Below opening in the same building in about 13,000 square feet of space followed in June. The terms of both of their lease agreements are unclear.
Jack deVilliers, Regency's managing director of the Northeast, declined to comment on pending litigation but said the community is thrilled about the project and that both Whole Foods and Five Below will be "exceptional additions to the neighborhood."
Attorney Stephen Lasser of Manhattan-based Lasser Law Group, who is representing Regency, did not respond to a request for comment. And neither Amazon-owned Whole Foods nor Five Below responded to requests for comment.
Leases
Real estate firm expands Long Island City headquarters
Address: 5-26 46th Ave., Queens
Landlord: Plaxall
Tenant: Charney Cos.
Lease size: 10,000 square feet
Asset type: Office
Latin restaurant opening new Williamsburg location
Address: 470 Driggs Ave., Brooklyn
Landlord: Kalmon Dolgin
Tenant: Carneval
Lease size: 7,500 square feet
Lease length: 10 years
Asset type: Retail
Brokers: MOD Commercial Realty's Eddie Mamiye represented the tenant and the landlord.
Sales
Crown Heights apartment site trades hands
Address: 945 Bergen St., Brooklyn
Seller: Nassau Brewing Co.
Buyer: Simon Dushinsky
Sale price: $18.8 million
Asset type: Multifamily
Financings
Luxury Midtown condo lands construction loan
Address: 133 E. 55th St., Manhattan
Owner: Rybak Development and BK Developers
Lender: Emerald Creek Capital
Loan amount: $52 million
Asset type: Multifamily
A controversial and long-awaited residential tower slated for South Street Seaport appears to be moving full steam ahead.
Developer Howard Hughes Holdings on Aug. 1 purchased $40 million worth of air rights from the city for the project long planned at 250 Water St., property records show. Although the firm recently spun off its neighborhood holdings into a publicly traded company called Seaport Entertainment Group, Howard Hughes itself is listed as the buyer on the transfer, which hit city records Monday.
The developer has spent years trying to build a 27-story, roughly 400-unit tower at the site in the face of intense community opposition, and the air-rights transfer was a key part of the controversy. The purchase was meant to help fund the financially struggling South Street Seaport Museum, and the community group South Street Seaport Coalition had argued in a lawsuit that the city's Landmarks Preservation Commission inappropriately took this under consideration when approving the project.
Judge Arthur Engoron ruled in the coalition's favor in January 2023, but his decision was unanimously overturned by the appellate division of New York state Supreme Court that June. In May the New York Court of Appeals, the state's highest court, declined the coalition's motion to appeal this ruling, essentially affirming the appellate division's decision and clearing the way for the tower to move forward.
Jonathan Boulware, president and CEO of the museum, said in a statement that the air rights transfer will serve as an "endowment-like investment that will sustain the Seaport Museum as an interpreter of New York City for generations to come."
Representatives for the city and Howard Hughes did not respond to requests for comment by press time. PincusCo was the first to report the news of the transfer.
The 250 Water St. project also got a boost when the state extended the completion deadline for its now-expired affordable housing tax break 421-a to 2031 in this year's budget. The tower's residential units will include 100 designated as affordable housing for people earning between 40% and 120% of the area median income, or about $56,000 to $168,000 for a family of three.
One-in-six dairy products in U.S. retail stores contained signs of inactive bird flu virus this summer, regulators said, slightly lower than the numbers seen in a different survey when the pathogen was first found in the nation’s dairy herds.
None of the 167 samples, which included milk, ice cream, hard cheese, butter, cream cheese and aged raw milk cheese, contained viable H5N1 bird flu virus, the U.S. Food and Drug Administration said. The results show pasteurized dairy remains safe to consume.
It was the second FDA survey, after the first in April found inactive viral particles in one fifth of sampled dairy products. The latest effort tested a wider array of foods from more states, leading the FDA to caution that the results may not be directly comparable.
“Obviously there’s a great deal of concern on the potential and real impacts to human health,” said Eric Deeble, deputy under secretary for Marketing and Regulatory Programs at the Department of Agriculture. “I do feel like the response is adequate.”
None of the raw milk products that were tested contained any H5N1 genetic material. The FDA said that indicated the samples came from cows that weren’t infected, and doesn’t mean raw milk is safe for consumption.
Cows that test positive are removed from the commercial food supply. A test of hamburgers that were intentionally inoculated with the virus found that cooking made them safe for human consumption, said Emilio Esteban, the USDA’s under secretary for food safety.
Thirteen people have tested positive for the virus this year as of Aug. 8, according to the Centers for Disease Control and Prevention, and 189 dairy herds in 13 states have been affected by the H5N1 bird flu strain. The movement of cattle between states will increase in the fall, according to the USDA, which is a key risk factor for transmission between herds.
The MTA could do more to protect riders and transit workers traveling on the subway from inhaling troublingly high levels of fine-particle air pollution in the system’s stations, said a researcher behind a new study examining the air pollution.
The fine particles are largely generated by the friction and grinding of steel train wheels braking against steel rails. The particles can accumulate in tunnels and on tracks, and are back in the limelight following the latest study’s finding of “exceptionally high concentrations” of the air pollution in parts of the system.
MTA officials disputed the researchers’ conclusions but said they work regularly to improve air quality in the system; the agency circulates a trio of vacuum trains to suck up debris and particles overnight and also periodically power-washes underground platforms.
But those measures do not go far enough, said Masoud Ghandehari, a professor in NYU Tandon’s Civil and Urban Engineering Department.
“I think at this point we have shown that there's a concern that needs to be met,” Ghandehari said in an interview, referring to similar research by colleagues at NYU’s Grossman School of Medicine of which he said the new study expands on. “There’s a lot of tunnels, I understand that, but there’s also five million people riding those tunnels everyday and it’s a responsibility of the agency that provides the service that it’s safe.”
Ghandehari, who noted that he regularly rides the subway and does not seek to discourage people from utilizing mass transit, said that the MTA should develop a plan for thoroughly cleaning tunnels and tracks and monitor air quality data.
The city’s underground subway stations are not equipped with air filters or monitors, said MTA spokesman Mike Cortez. The MTA operates, he said, three vacuum trains, made up of two or three cars each, that move through the system’s more than 600 miles of subway tracks sucking up debris and metal dust. Two of those trains are in motion seven days each week, and the third operates five days per week. The trains operate in the overnight hours between 10 p.m. to 6 a.m., each cover a section of the system, with the trio of trains sweeping through the entire system each night, according to Cortez.
“While it's not going to immaculately clean the dust, it gets sucked up with the debris,” Cortez said. The MTA notes that 41% of the system is above ground where outdoor air circulation mitigates air pollutants. The other 59% of the system that’s below ground, however, is more vulnerable to trains sweeping hazardous air particles into stations, said Ghandehari.
MTA mobile washing crews power wash platform surfaces in nightly batches. All 472 subway stations receive at least one deep clean every 45 to 60 days, Cortez said. Some stations receive more than one in that period.
While station air may be laced with pollutants, the air inside cars is another story. All subway train cars are equipped with high-end air filters—put in place amid the Covid-19 pandemic—that refresh the air every 3 to 4 minutes, said MTA Communications Director Tim Minton.
The MTA is far from the only transit agency grappling with underground-pollution. Several of the world’s busiest transit systems have taken steps to address the problem. The London Underground is experimenting with crews that descend on the tunnels and tracks while the system is shuttered overnight, which isn’t feasible for New York’s 24/7 subway system; Barcelona has explored new station designs; and The Seoul Metropolitan Subway has installed more than 800 air quality sensors to monitor data in real time.
Addressing the issue comes down to a willingness of transit officials to experiment and invest the dollars necessary to support those innovations to monitor and enhance the system’s air quality. The MTA, however, has a laundry list of investments — accessibility upgrades, new rail cars, system expansion and so on — that tend to land higher on the list, said Andrew Rein, president of fiscal watchdog the Citizens Budget Commission and a former executive deputy commissioner with the city’s health department.
“The issue for the MTA always is that there are so many different investments they can make, and it's prioritizing those investments and figuring out the costs and benefits of all of them,” said Rein. “We have to invest in transit, I just don't know where this fits into that.”
Companies operating as middlemen between workers and the state in a popular home care program are suing to block changes to the system that would replace them with a single entity.
The companies have been big winners under New York’s Consumer Directed Personal Assistance Program, which uses them to distribute Medicaid dollars to pay home care workers in exchange for a cut. But that arrangement is set to change soon, thanks to a push by Governor Kathy Hochul to reduce the number of so-called “fiscal intermediaries” down to a single firm.
The program was launched to allow people to more easily hire and train their own caregivers. The number of companies steering tax dollars to caregivers has ballooned to over 600 in recent years along with the cost of the program. In 2023, spending on the industry reached $9.1 billion, according to data from the federal Centers for Medicare & Medicaid Services.
Gov. Kathy Hochul secured a last-minute change to the program during budget negotiations earlier this year that would dramatically cut the number of middlemen in an attempt to rein in costs. The new sole contract is slated to be awarded October 1.
The lawsuit, which names the state Health Department and Commissioner James McDonald, was filed in the state Supreme Court in Albany County on Monday by an association of intermediaries. In the petition, the coalition, known as Save Our Consumer Directed Home Care Program, said the move will put hundreds of the middlemen out of business, cost jobs, and jeopardize services for hundreds of thousands of New Yorkers enrolled in the program.
The group accused the Health Department of setting “anti-competitive, unreasonable restrictions” in its request for proposals for the new contractor, “creating an almost insurmountable bar” to qualify as a statewide fiscal intermediary, according to the filing.
The firms balked at a requirement that the contract go to a company with experience functioning as a statewide intermediary in another state, and that the bidding process would not be subject to traditional oversight by the state Comptroller. Both of those requirements were set by Hochul and state lawmakers in budget legislation earlier this year, not by the Health Department in its request for bids, according to Bill Hammond, senior policy fellow at the fiscally conservative think tank The Empire Center.
The speed at which the state is pursuing the change, in just six months, is a concern, Hammond said.
“The state is not known for being able to do things efficiently and quickly,” he told Crain’s, adding that the lawsuit will likely slow things down.
The petitioners aren’t the only interest group upset by the new policy and the way it unfolded.
“Yesterday’s suit is likely the first of what I imagine are many based upon what I’m hearing,” said Bryan O’Malley, executive director of another group, the Consumer Directed Personal Assistance Association of New York State, which was not involved in the lawsuit.
The Department of Health would not comment on ongoing litigation, according to spokeswoman Danielle DeSouza.
Community advocates are scrambling to overturn a court decision that could allow Mount Sinai to officially shutter Beth Israel Hospital. But prior hospital closures in the city indicate that the new legal effort isn’t likely to block what many see as inevitable.
The new lawsuit, filed in a Manhattan state court Monday evening, updates a previous legal challenge filed by advocates which was thrown out earlier that day. The updated filing targets the Health Department’s decision to greenlight the closure, alleging that the “unlawful” decision denies Manhattan residents access to care.
“The closure of [Mount Sinai Beth Israel] will have a devastating impact on the residents of Lower Manhattan, who already suffer from insufficient hospital services,” the lawsuit says. The advocates also allege that Mount Sinai intentionally tanked Beth Israel’s finances in an attempt to shutter the hospital and sell valuable real estate.
Advocates criticized Mount Sinai’s plans to preserve access to health care amid the pending closure. The Department of Health required the health system to ensure access to emergency care as a part of its closure plan; Mount Sinai responded by agreeing to build an urgent care center and invest $20 million to expand the emergency room at its neighboring facility New York City Health + Hospitals/Bellevue. The lawsuit called the plans are “grossly deficient,” blasting the Health Department for approving a plan the community deems inadequate.
Representatives from the Health Department and Mount Sinai declined to comment on the new litigation.
The new lawsuit thrusts Beth Israel’s planned closure date into limbo. Mount Sinai CEO Dr. Brendan Carr said in a letter to employees on Tuesday morning that “the closure date of 16th Street is not finalized,” committing to updating staff as more information becomes available.
Despite the new legal strategy, it’s unlikely that Beth Israel will remain a fully functioning hospital. Several hospitals in New York – specifically older facilities that are difficult to repair – have closed in recent years, as more patients get care elsewhere and health systems decide whether the value of their inpatient revenues exceed the cost.
“For all intents and purposes, Beth Israel as we have known it will not continue to exist,” said Arthur Webb, a health consultant and former executive at St. Vincent’s Hospital, which was located in Greenwich Village and closed in 2010 after it went bankrupt.
Advocates have turned to the courts to block hospital closures in the past, including the long drawn-out shutdown in 2014 of Long Island College Hospital in Cobble Hill. Community members filed lawsuit after lawsuit – backed by former Mayor and then Public Advocate Bill de Blasio – to keep the SUNY-owned hospital open, ultimately prolonging its eventual shutdown for 16 months.
Although the legal challenges kicked the can down the road, Brooklyn Supreme Court Justice Johnny Lee Baynes, ruled that SUNY could sell its property to Fortis Property Group for $240 million. As a part of the deal, NYU Langone built a freestanding emergency room in Cobble Hill.
The potential best-case scenario for community members would be for Mount Sinai to build a state-of-the-art urgent care clinic to preserve access to basic health services in Lower Manhattan, as it has committed to doing, Webb said. Mount Sinai has agreed to operate the urgent care center 24/7 in the first three months after Beth Israel closes.
Although it’s unlikely that advocates’ legal argument will be successful, Webb said that the essence of the case gets at an important issue: whether or not the state will ensure that the health system preserves access to care. It is the Health Department’s responsibility to balance the financial challenges that health systems face with their responsibility to provide accessible health services, he said.
“It looks like the big health systems are driving the bus,” Webb said.
EMERGENCY EXPANSION: Catholic Health is set to host a ribbon cutting ceremony at 12:30 p.m. today to announce the expansion of its emergency department at St. Charles Hospital in Port Jefferson. The expansion, which cost $10 million, has doubled the size of the hospital’s emergency room and includes 10 treatment bays, a larger waiting room and additional space for clinicians to treat people with substance use disorders. Catholic Health received $4.2 million from the Health Department’s capital projects transformation program to finance the expansion.
DATA HACK: Attorney General Letitia James has reached a $4.5 million settlement with Long Island diagnostics company Enzo Biochem for failing to protect patients’ health data. James said Tuesday that Enzo Biochem had poor data security practices, leaving the company vulnerable to a ransomware attack last year that compromised approximately 2.4 million patients’ health information. James reached the settlement in partnership with attorneys general from Connecticut and New Jersey, and $2.8 million will flow to New York.
TRAUMA DESIGNATION: Northwell Health’s South Shore University Hospital in Bay Shore has been designated a Level 1 trauma center by the American College of Surgeons, making it eligible to provide the most advanced level of critical care, the health system said Tuesday. Level 1 trauma centers provide 24/7 emergency care from general and specialty surgeons, offer education to communities about preventing injuries and provide continuing education to health care workers in trauma settings.
CORRECTION: This story, published on Aug. 13, has been corrected to reflect that dental startup Tend no longer offers Netflix and does not have Bose headphones at its offices.
Mpox cases in New York City exploded last fall and have remained elevated, but Health Department officials cannot say exactly why.
More than 300 New Yorkers have been diagnosed with mpox in the first seven months of 2024, already 60% more cases than officials recorded in all of 2023. Numbers are down from the height of the epidemic in July 2022, when close to 100 people a day were diagnosed. The biggest spike in recent months was in April when 53 cases were recorded. Levels have dropped since then but remain high: July saw a 73% increase over July of last year.
The city’s Department of Health and Mental Hygiene could not say what is driving the increase in cases in 2024 or provide information on current vaccination rates.
Providers are not required to report adult vaccination rates to the citywide immunization registry outside of a public health emergency, according to spokesperson Patrick Gallahue. It is also unclear how much the city is spending on vaccination efforts. The costs of investigations, clinical consults, and vaccinations are included in the agency’s budget, Gallahue said, without providing details on the cost of mpox vaccination, treatment, and outreach. The department’s budget is worth over $2 billion in the current fiscal year.
The city’s rising case count does not appear to be linked to a new, more dangerous strain driving outbreaks across central and east Africa. That strain, clade I, has raised alarms among officials at the World Health Organization, which is set to decide Wednesday whether the surge in cases in the Democratic Republic of the Congo and neighboring countries constitutes a public health emergency of international concern.
No clade I cases have been detected in the United States but the Centers for Disease Control and Prevention have warned the strain, which is endemic to central Africa but not the United States, could be introduced through a traveler to countries where it is prevalent.
Mpox, a viral disease spread predominantly among men who have sex with men, caught public health officials by surprise in 2022 when it surged in New York and globally, driven by the more widespread clade II variant. People with the virus can experience rash, fever, and respiratory symptoms, in some cases requiring hospitalization. Clade I is more transmissible and likely to cause infection than the strain found in the United States, according to the CDC. Officials believe the available two-dose vaccine, known as JYNNEOS, is effective against clade I.
Since 2022, the department has issued guidance about diagnosis, prevention, and treatment, and provided vaccines at its Sexual Health Clinics. By January 2023, roughly 52,000 New Yorkers had received a second dose of the JYNNEOS vaccine, according to a report issued by the Health Department at the end of the mpox emergency declaration.
Vaccination appears to be the greatest protection against the virus. According to a Health Department advisory issued in May, 73% of cases recorded between October 2023 and April 2024, were among people who were unvaccinated or only had one dose.
A close ally of the mayor’s and a reform-oriented Manhattan official are among the growing list of politicians lining up to run for New York City comptroller, the city’s top fiscal watchdog and accountability officer.
Previous comptrollers have used the citywide office to needle the incumbent mayor and often as a platform to eventually run for City Hall themselves. The current officeholder, Brad Lander, announced plans last month to challenge Mayor Eric Adams in next year’s Democratic mayoral primary, which will force him to give up his existing job after just one term and set off an immediate scramble to fill his seat.
Mark Levine, the Manhattan borough president, filed paperwork last week to begin fundraising for a comptroller campaign, although he has not formally entered the race. Meanwhile, Jenifer Rajkumar, a Queens State Assemblywoman known largely for forming a close allegiance with Mayor Adams, announced her own comptroller campaign on Monday.
Others are likely to enter the race before the June 2025 primary. Justin Brannan, a Brooklyn councilman who has played a leading role in city budget negotiations, is “gearing up” for a likely comptroller campaign, a person familiar with his plans said on Tuesday. (Antonio Reynoso, the Brooklyn Borough President, announced on Monday that he had decided against joining the comptroller race after initially considering a bid.)
Past comptrollers like Scott Stringer, John Liu and Bill Thompson all used the office to mount campaigns for mayor — albeit unsuccessfully. Political consultant Jason Ortiz called the office “both a very useful bully pulpit and one where you can do real things to hold people accountable and show that you’re a steward of the city finances.”
“It’s an incredibly powerful office if you’re able to use the levers of power to your advantage,” Ortiz said.
Although sometimes belittled as a platform for political posturing, the comptroller’s office has real powers to probe city government and shape the discourse — armed with a $123 million budget and a staff of about 800 people, including auditors and economists. Lander, a progressive, has antagonized Adams by releasing high-profile investigations into his administration’s handling of costly migrant-care contracts, homeless encampment sweeps, limits on shelter stays, and gunshot-detection software.
The contenders to replace Lander have not spelled out detailed plans for how they would use the office — and Lander himself could theoretically drop his mayoral bid and switch to running for re-election as comptroller any time before ballot petitioning starts next spring.
Rajkumar, who represents southwest Queens, has made a name for herself by appearing at Adams’ side at numerous public events in the last year, and she did the city’s bidding in Albany by carrying bills to crack down on illegal smoke shops and loosen bidding rules for capital projects. In interviews, she has suggested she would take a less adversarial approach toward the mayor if elected comptroller.
“Traditionally, the comptroller is a man in an office crunching numbers, but I will make it so much more,” Rajkumar said in a campaign announcement on Monday, in which she referred to herself as “omnipresent.” (She also referenced her own nickname, “the lady in red,” an allusion to the crimson dresses she wears at most public appearances.)
“I am on the ground with the people in every corner of this city, hearing firsthand how government is and isn’t working for them,” she said.
But Rajkumar, as a state official, may face an uphill battle securing citywide support, with a negative balance in her city campaign account as of July. Levine, on the other hand, has over $260,000 that can be transferred from his prior borough president fundraising; Brannan, who is term-limited from his South Brooklyn council seat next year, has about $8,000 on hand.
A former Upper Manhattan City Councilman, Levine rose to prominence during the Covid-19 pandemic as chair of the council’s health committee. After winning a competitive primary for borough president in 2021, Levine has become a vocal advocate for building more housing — fast-tracking some rezonings and filling Manhattan’s community boards with more pro-development members.
Lately, he has taken on causes like sidewalk sheds and fraudulent license plate covers designed to avoid tolls.
Mayor Adams, asked at a Tuesday press conference whether he planned to endorse Rajkumar, said only that he would “let the election process take its place.”
“I’m pleased with her, she’s fought hard for the city,” Adams said.
Lander’s mayoral campaign now puts him in the unusual position of scrutinizing the current mayor while also running against him. Last week, his campaign released a fundraising email touting the new audit released by his government office into the Adams administration’s contract with controversial migrant services provider DocGo.
Still, some observers have argued that Lander, a fellow Brooklynite, has been less harsh on Adams than some past comptrollers. Stringer, whose comptroller term coincided with Bill de Blasio’s mayoralty, released scathing investigations into de Blasio’s preparation for the pandemic and the mental health program headed by de Blasio’s wife, Chirlane McCray.
In a sudden industry reset, Starbucks ousted its chief executive and picked Chipotle Mexican Grill's Brian Niccol as its next leader. The move simultaneously flipped the fortunes of two of America’s largest restaurant chains.
Shares of Starbucks, which now has a new lifeline, soared by 24% on Tuesday, their biggest intraday gain on record. Meanwhile, shares of Chipotle, which has now plunged into uncertainty, dropped by as much as 13%.
Niccol will start his new role on Sept. 9, the company said in a statement. The current chief financial officer will lead the company until then. Niccol’s predecessor Laxman Narasimhan is stepping down from his position effective immediately.
The leadership shakeup comes after activist investors Elliott Investment Management and Starboard Value reportedly amassed stakes in the company. While Elliott hasn’t outlined specific asks of Starbucks, many of its targets have changed management after its involvement. Elliott said on Tuesday that it welcomes Niccol’s appointment.
At Starbucks, shares had plunged 20% this year before the CEO change as the chain posted two straight quarters of comparable sales declines. The stores have been struggling to attract consumers who are more hesitant to spend on pricey lattes.
Board chair Mellody Hobson downplayed Elliott’s influence in an interview Tuesday with CNBC, saying the company initiated discussions about the leadership of the company several months ago.
“Sometimes you have to make tough decisions and those tough decisions are the right thing to do,” Hobson said in the interview. “It isn’t necessarily because of outside forces.”
Hobson said the board took full responsibility for the weakness at Starbucks and that it wanted to move fast to fix the business. “We own the outcomes,” she said. “We’re not passing any buck and we understand we have a job to do and we’re doing it.”
Although former CEO Howard Schultz doesn’t have a board seat or hold a formal role within the company, Starbucks’ sixth-largest shareholder provided a statement of support for the new CEO. Hobson said that she told Schultz a week ago about the decision and “he said, ‘Mellody, that’s a home run.’”
Hobson said the board hasn’t laid out a specific turnaround plan yet, urging patience. “He’s not in the seat yet, let him get there and then come out with the plans,” she said. “He will be the one who will drive the strategy and the board will govern.”
Narasimhan took over the helm at Starbucks in March 2023, following Schultz’s third stint as CEO. Schultz had retaken the reins a year earlier when Kevin Johnson retired. Schultz had led Starbucks’ expansion in the ’80s and ’90s before stepping down as CEO in 2000. He returned to the role eight years later and led the company until Johnson took over in 2017.
“The firm’s CEO position has been a revolving door,” wrote Adam Crisafulli, an analyst at Vital Knowledge.
Narasimhan’s exit also means he’ll miss out on time- and performance-based stock awards that currently have a gross value of more than $11.6 million, according to the company’s latest proxy filing. That figure includes equivalent dividends he’d stand to receive.
Chipotle comeback
Niccol joined Chipotle as CEO in 2018 as the chain faced backlash following a string of food safety issues and activist pressure from the likes of Bill Ackman. The company has been a bright spot in the struggling restaurant industry. It’s outperformed competitors in recent quarters by managing to bring in diners even as others reel from a drop in demand. Chipotle’s shares have risen more than 20% this year through Monday’s close, but fell after the news as investors worried about who would take over.
Under Niccol, the burrito chain started investing in store remodels, faster service times and a fresh marketing campaign. He also partnered with DoorDash to capture diners who prefer delivery and added new menu items embracing diet trends.
Before joining Chipotle, Niccol was the CEO of Taco Bell for three years. He met success courting crowds with indulgent dishes such as Doritos Locos Tacos and A.M. Crunch Wraps. When he was named CEO of Chipotle, investors including Ackman welcomed the change.
“We view Niccol as an exceptional executive based on his track record in driving robust results at Chipotle since he arrived in 2018,” Baird analyst David Tarantino said in a research note.
Chipotle said that Chief Operating Officer Scott Boatwright, who joined the company in 2017, will take over as interim CEO. CFO Jack Hartung, who recently said he would retire in 2025, has also changed course and agreed to remain with the company indefinitely as president of strategy, finance and supply chain to ensure a smooth transition, according to a statement.
“We remain confident in Chipotle’s trajectory given deep management expertise,” Sharon Zackfia, an analyst at William Blair, wrote. “While a CEO search creates inherent uncertainty, we view Boatwright as a strong candidate and also suspect that Chipotle will attract stellar outside interest.”
The founder of an obstetrics and gynecology practice with offices in Brooklyn and Manhattan is opening a new location in the Plaza District after buying a landmarked commercial townhouse for $11 million.
Dr. Dimitry Goncharov, a board-certified obstetrician and gynecologist who founded Pure OBGYN a decade ago, acquired the 6-story building at 12 E. 53rd St. under a limited liability company named after the address, according to city records and information from JLL, the commercial broker who helped facilitate the sale.
Goncharov signed the deed himself and told Crain's Tuesday that he hopes to open up the new offices as "fast as possible." The East 53rd Street location will join Pure OBGYN's other medical offices in the Flatiron District, Midtown and the Upper East Side in Manhattan and Park Slope in Brooklyn.
Originally constructed in 1871 and designated a city landmark in 2012 for its Tudor-inspired Gothic Revival style, the 7-unit property was sold by the Laboratory Institute of Merchandising College—a private school focused on education in business, fashion and lifestyle that owned the entire building, but vacated the space in 2022. The home has hosted numerous significant events throughout the years, including a League of Nations luncheon, and was once the headquarters for the Automobile Club of America, the county's first automobile club that dissolved in 1932.
The roughly 18,000-square-foot building, located between Fifth and Madison avenues, is known as the Fish-Harkness House after its former owners — Harvey Fisk, a prominent banker and philanthropist, and William Harkness, an heir to the Standard Oil fortune.
JLL's Guthrie Garvin and Clint Olsen, managing directors of the firm's capital markets team, represented the seller.
This story has been updated to include more information from the Laboratory Institute of Merchandising College.
Larry Silverstein, the developer behind the World Trade Center complex in Manhattan, is eyeing more opportunities uptown.
The 93-year-old real estate mogul — who has largely focused on developing towers in downtown Manhattan — said he would consider expanding more in Midtown as commercial-property distress spurs more deals. Plunging property values mean developers can snap up office buildings cheaper and potentially renovate the properties or convert them to housing.
“There are going to be many opportunities in Midtown,” the chairman of Silverstein Properties said in an interview. “You’ve got many office buildings that are no longer functional and banks are finding themselves increasingly in possession of buildings that they don’t want to possess.”
Silverstein, who purchased the lease to operate the World Trade Center just weeks before the Sept. 11 terrorist attacks, is known for his role helping to redvelop the area after the destruction, which he’s chronicled in a new book called The Rising. Nowadays, his company owns and operates more than $10 billion of real estate assets with properties in cities including New York, Philadelphia and Los Angeles.
While his focus in New York has largely centered around the downtown area, his company owns a few properties in Midtown including an office tower and apartment buildings.
More developers have been considering taking aging office buildings and turning the properties into housing, with those conversions picking up in New York as office vacancies rose since the pandemic. Silverstein is now working to convert 55 Broad St., a former office building for Goldman Sachs Group, into apartments, its first such project.
While those conversions are often complicated and costly, they offer one possible path for properties that are languishing.
“Residential is going to find its way increasingly into Midtown Manhattan and into what was originally office neighborhoods,” Silverstein said.
Final piece
Silverstein still remains focused on the massive redevelopment of the World Trade Center area, where his company developed the 3, 4 and 7 World Trade Center skyscrapers that count tenants including Moody’s, Uber Technologies and Spotify Technology.
The fate of the final office building in Silverstein’s master plan, a tower at 2 World Trade Center, is still unknown. Currently, the site is a plot that houses mechanical equipment and a beer garden.
Silverstein has been in talks with American Express to relocate their headquarters from nearby, according to people familiar with the matter who asked not to be named citing private matters.
Silverstein declined to name any potential tenants, but said a deal could happen for the tower in the “very near future.”
A spokesperson for American Express said the company regularly evaluates its global real estate strategy and that it’s committed to staying in Manhattan.
“We are conducting a thorough assessment of our corporate headquarters located at 200 Vesey St., including the potential to refurbish our current space or relocate to another facility in Manhattan,” the spokesperson said. “This is a multi-year process and no decisions have been made at this time.”
Silverstein added that the rest of his World Trade Center offices are 97% occupied.
Silverstein was optimistic that the financing environment will improve as the Federal Reserve weighs cutting its benchmark rate. Building an office tower, especially one without tenants lined up, has been tough as lenders pulled back.
Casino bid
Silverstein also sees opportunity in a swath of Manhattan near the Jacob K. Javits Convention Center, where he proposes to turn a plot into a gaming, hotel and housing complex called the Avenir. He is one of several developers vying for one of three licenses to bring a casino to New York City and its surrounding suburbs.
Silverstein is partnering with Greenwood Gaming and Entertainment on the proposal, which would build two 46-story towers with luxury hotel rooms and more than 100 affordable housing units on 41st Street and 11th Avenue. The plan hasn’t received much pushback, he said, helping to bolster his confidence that he has a good shot at winning one of the licenses.
The New York State Gaming Facility Location Board expects to determine the winners of casino licenses by the end of 2025. Silverstein is confident one will end up being built in Manhattan despite opposition from some local politicians and community boards, because the city and state governments will want venues that generate as much tax revenue as possible.
“It’s unquestionable that there’s a need for more revenue at both levels, city and state. And because there’s this constant need for revenues, and it constantly increases, the casino is a vital source,” Silverstein said.
Leases
Real estate firm extends, expands in Garment District
Address: 520 Eighth Ave., Manhattan
Landlord: GFP Real Estate
Tenant: Denham Wolf Real Estate Services
Lease size: 9,253 square feet
Lease length: 11 years
Asset type: Office
Brokers: Christopher Turner and Kate Hrobsky represented the tenant in-house. Matthew Mandell represented the landlord in-house.
Sales
SKF Development sells Wakefield property
Address: 4427 White Plains Road, Bronx
Seller: SKF Development
Buyer: 4427 WPR Housing Development Fund Corporation
Sale price: $23.6 million
Asset type: Commercial
Financings
Luxury Long Island City condo lands construction financing
Address: 24-01 Queens Plaza North, Queens
Owner: New Empire Corporation
Lender: Naftali Credit Partners and Axos Bank
Loan amount: $72 million
Asset type: Multifamily
New York City’s transit system plans to borrow against real estate taxes it receives to help raise $2 billion for infrastructure upgrades, creating a new borrowing mechanism that’s separate from its traditional farebox credit.
The Metropolitan Transportation Authority, the nation’s largest mass-transit network, is slated to start selling debt backed by real estate transfer tax receipts — a so-called mansion tax — later this year or in early 2025, according to Kevin Willens, the MTA’s chief financial officer.
The state began allocating the mansion tax revenue, along with state and city sales tax receipts, to the MTA in 2019 to help fund necessary capital projects and service improvements. The transit agency collected $345 million of real estate transfer tax revenue in 2023 and anticipates receiving a similar amount each year through 2028, per the MTA’s latest financial plan.
The strong demand for housing in New York City means the levy will provide the MTA with a reliable source of revenue, even as some wealthier residents have decamped for Florida or Texas, according to Matt Fabian, a partner at Municipal Markets Analytics.
New York City is “the most established real estate market in America,” Fabian said. “The risk with a transfer tax is that properties stop transferring because demand for properties goes away. But that has never been the case in New York, even now. Even in the financial crisis, it was never an existential crisis for this tax base.”
The $2 billion of mansion tax bonds will help fund the MTA’s $51.5 billion 2020-2024 capital program, which will upgrade subway stations, finance flood-protection projects and renovate a 130-year-old rail bridge that links New York City to its northern suburbs.
The MTA had $47.4 billion of debt outstanding as of July 24, including $18.3 billion of transportation revenue bonds that are repaid with transit fares, according to MTA data. Adding another borrowing tool provides some relief to its operating budget and offers bondholders a way to invest in the MTA while avoiding ridership fluctuation as transit usage has yet to match pre-pandemic levels.
The mansion tax is a supplemental levy on the transfer of residential properties of at least $2 million. The revenue flows into MTA’s capital lockbox — rather than its operating budget — with that pot of money being reserved for infrastructure needs. Keeping the revenue separate from the operating budget should enhance the new real estate credit, Willens said.
“Our expectation is that it’s going to be a high quality credit,” Willens added.
The MTA has sold other bonds that are repaid from a different revenue source than farebox receipts and bridge and tunnel tolls. The transit provider has issued payroll mobility tax debt, bonds backed by New York City sales tax revenue and also securities repaid with a combination of motor fuel taxes, petroleum business taxes and mortgage recording levies.
While the MTA and state lawmakers have found ways to raise money for the transit system, Fabian says investors need to remember that an MTA bond repaid with money other than farebox revenue is still an obligation of a more than 100-year-old system that already has a high debt level and must modernize and fortify itself from extreme weather events.
“They may not be the same revenue stream,” Fabian said, “but they’re sisters.”
New York City and most of the surrounding region is under a flash flood watch Tuesday afternoon into Wednesday morning, with the National Weather Service warning of up to five inches of rainfall in some areas that could pose an “elevated threat to life.”
The NWS officials said early Tuesday that heavy rains will douse the metro region with at least one to two inches of rain per hour, and dump between three and five inches of rain on some places. Gov. Kathy Hochul warned New Yorkers that the region is in the “bull's-eyes” of the storm and that the inclement weather could cause major flooding and disruptions to transportation.
“This is something to be taken seriously,” said Hochul during a Tuesday briefing on the storm. “Just a small amount of rain could turn your vehicle into a boat and you are washed away.”
The New York City Emergency Management Department has issued a travel advisory for Tuesday 2 p.m. until Wednesday at noon. As of now, the city says it expects the worst of the storm to hit Tuesday evening into the overnight and early morning hours of Wednesday.
State officials are preparing to deploy 100 National Guard soldiers to where they’re needed and said crews are available to respond to downed power lines and to clear roads of debris. The MTA said it has chainsaw crews on standby in case of fallen trees and is deploying trains with equipment to pump flood waters out of mass transit.
Tuesday’s storm is separate from the remnants of Tropical Storm Debby that are expected to hit the region beginning late Friday and remain in the area Saturday and Sunday, according to Jackie Bray, the commissioner of the state’s homeland security and emergency services.
“As you’re planning for today, also be thinking and preparing for the weekend,” said Bray. “When we have seen this level of threat before in New York state, they have been bad days.”
New York marijuana regulators on Tuesday approved 86 more recreational cannabis business permits, bringing the total number of licenses awarded so far this year to 841 and roughly 1,600 since licensing began two years ago.
The state Cannabis Control Board unanimously signed off on the new group of permits, which included:
- 22 retailers
- 16 microbusinesses
- 19 cultivators
- 11 distributors
- 18 processors
Regulators also signed off on another 15 provisional licenses for retailers. State-legal marijuana sales have neared the half-billion-dollar mark since the market launched in December 2022, with $493 million in all-time sales as of July 24, Office of Cannabis Management Policy Director John Kagia told the board, adding that the legal market is still gaining “great momentum.”
“We are now comfortably double where we were by the end of 2023: $160 million for 2023, and we’re already at $332 million for 2024 and growing. I think this is just, again, a very bullish outlook for this year,” Kagia said. “I would fully expect that, as New York’s legal market grows, a $5 billion outlook over the next few years is a reasonable estimate.”
But, he added, “There’s still a lot more work to do.”
Read the full story at Green Market Report.
Migrant services contractor DocGo billed New York City some $11 million in costs that the Adams administration shouldn’t have paid and must recoup, according to a new audit by city Comptroller Brad Lander.
The audit found that the city’s Department of Housing Preservation and Development had “poor fiscal control” over a controversial $432 million no-bid contract the agency awarded DocGo in 2023. Lander's office reviewed paid invoices for May and June 2023 — the first two months of the contract — and found that 80% of the $13.8 million paid to DocGo within that time did not warrant payment, either because the amounts were not allowed under the contract or they weren’t adequately supported by documentation.
Lander is running against Mayor Eric Adams in next year's Democratic primary. The comptroller has questioned the mayor’s use of his emergency procurement powers to handle the surge of asylum seekers, and in September, the comptroller's office launched what Lander described as a “real-time audit” of DocGo’s contract to scrutinize oversight and invoices.
The 74-page report states that the audit found many issues with HPD’s monitoring of the firm. Namely, that HPD did not hold DocGo to its contract terms and didn’t require the company to document that its spending was reasonable.
City officials did not immediately respond to questions about the audit’s findings, including whether they will seek to recoup some costs from DocGo, which says it has served 32,000 asylum seekers entering New York.
In a written response to the audit, HPD Commissioner Adolfo Carrión Jr. said that in their oversight, housing officials “exercised good judgment rather than insisting on bureaucratic steps” to expedite migrant services. Carrión said housing officials often gave verbal permission to greenlight DocGo’s spending to move quickly, providing food and housing for the daily influx of migrants.
The response also said that HPD has fixed or is in the process of resolving the issues raised by the audit.
Auditors found that in the initial two months of the contract the city paid DocGo nearly $1.7 million for 9,874 unused nights for hotel room in Manhattan, Brooklyn, Queens and towns north of the city; DocGo collected $408,680 in commissions from the sum. In one instance, the audit said, the city paid DocGo $78,540 for 462 vacant rooms at the Imperial Hotel in Brooklyn for nine nights. The amount charged by the hotel was $69,300, or $150 per night per room; DocGo collected a $9,240 commission.
Investigators similarly discovered that DocGo exceeded its contract terms in charging the city more than $2 million for security staff. The audit said the company billed the city for 40,219 hours, at an hourly rate of $50, for security above the contract’s limit. DocGo earned a $583,274 profit from the transactions, according to the comptroller's office.
Thomas Meara, a DocGo spokesman, said the company paid the bulk of its invoices directly to its subcontractors and hotel owners. HPD is required to preauthorize subcontractors used by DocGo to ensure they comply with the city’s standards, but the comptroller’s office said HPD provided no evidence that it conducted such reviews. Lander's office said this means that $9 million of the $13.8 million the city initially paid DocGo went to subcontractors that were not pre-vetted by the city.
Since the contract’s initial two-month period, the city has paid DocGo an additional $168.1 million for contract-related expenses the company says it incurred through February 2024. Auditors warned that if the 80% error rate discovered in the first two months of invoices is applied across that amount, the city could have overpaid DocGo some $134.5 million.
DocGo could still claim an additional $250 million for the remainder of the contract for work through May 2024. Meara said that the company has received assurances from city officials that it will continue to be paid.
Japanese clothier Uniqlo acquired part of its U.S. flagship store for a stunning $350 million from co-owner Vornado Realty Trust, becoming the latest large retailer to conclude it’s better to own on Fifth Avenue than to rent.
Buying 17,000 square feet of space at 666 Fifth Ave. that it has leased since 2011 will save Uniqlo $27 million in annual rent, analysts said. The retailer will continue leasing 75,000 square feet of space in its store from a separate landlord, Brookfield. It isn’t clear if Uniqlo will borrow to pay for the purchase or if its parent, Fast Retailing Co., will simply draw from its $7.6 billion cash reserve. Uniqlo didn’t respond to a request for comment.
Uniqlo agreed to pay $20,000 per square foot for its store, well above the $8,400 per square foot paid earlier this year by Gucci’s parent for retail space three blocks north at 717 Fifth Ave. It’s nearly double the $12,000 a square foot paid last year by real estate investor James Dyson for retail space at 747 Madison Ave., according to Cushman & Wakefield.
Investors were startled by the price Vornado got for its 52% stake in the 666 Fifth space, especially considering LVMH-owned Sephora negotiated a two-thirds reduction in its rent at 520 Madison Ave., just one block east of the Uniqlo store. Vornado’s stock price jumped by 16% on the news, to nearly $32 a share, its highest price in two years.
As always, the value of real estate always comes down to location. Vornado President Michael Franco said his firm’s Fifth Avenue retail property is thriving while space that isn’t “prime prime” isn’t recovering so well.
“Prime high street [space] is really scarce,” he said on an earnings call Tuesday, “you have to focus on what makes it different from any other set of blocks in the city.”
The 666 Fifth sale helped the city’s second-largest commercial landlord report 57 cents a share in adjusted funds from operations in the second quarter, a 21% decline from the prior-year period. It leased 1.3 million square feet of space in New York, much of it stemming from Bloomberg LP agreeing in May to renew its 900,000 square-foot lease at 731 Lexington Ave. The occupancy rate in Vornado’s New York properties came in at 88.3%, a 10 basis-point improvement from the first quarter but below the prior-year period’s 90.1%.
Vornado continues to bulk up on cash and reduce debt by selling its 50% share of the Upper West Side apartment building at 50-70 W. 93rd St., pocketing $2 million in proceeds after paying its share of the $83 million mortgage. It said the sale proceeds from 666 Fifth would be used to partially redeem preferred shares that pay high dividends to holders.
Chief Executive Steve Roth indicated the next transaction would involve 770 Broadway. He said the firm has reached a “handshake deal” with a tenant to take all 1.1 million in office space but wouldn’t say whether he’s preparing to sell the building or lease it. He said Vornado would retain retail space leased to Wegmans.
Vornado officials added they have no plans yet to redevelop the site formerly occupied by the Hotel Pennsylvania, due to high borrowing costs.
A Bay Ridge diner that got caught up in a years-long tax-evasion scheme has been sold to a new owner, city records show.
Bridgeview Diner, a Brooklyn staple that was owned by Dimitrios Kaloidis from 2015 until his death in 2019, was bought for $11 million by a limited liability company registered in the same neighborhood, Yellowstone Realty, according to a deed that appeared in the city register Monday.
Ownership of the beloved greasy spoon at 9011 Third Ave. was transferred to Kaloidis' estate after he died and two years later came under the temporary control of Nassau County Public Administrator Edward Powers following a 2021 ruling in local surrogate's court as a result of the tax fraud allegations.
Late last year Attorney General Leittia James recovered more than $1.8 million from Kaloidis' estate after an investigation into his records from 2016 through 2021 revealed that he had failed to report more than $4 million in taxable receipts from the Bridgeview Diner as well as more than $350,000 in sales tax. And that was just the half of it — he apparently did the same at Georgia Diner in Queens, where he failed to report more than $3.3 million in taxable receipts during roughly the same time period and almost $300,000 in sales tax, according to court records and an announcement from James in December. In addition to these two eateries, Kaloidis also owned the Floridian Diner in Flatbush, which reopened in 2021 under new ownership, as well as the Arch Diner in Canarsie, which has since closed.
Built in 1981 between 90th and 91st streets, Bridgeview Diner was previously run for decades by Bay Ridgite Gus Panteleakis, until he sold it to Kaloidis — who had already owned the land it sat on — in 2015, the Brooklyn Paper reported at the time. It's unclear for how much Kaloidis acquired the local institution.
Real estate broker Helen Psaras of the local firm John Psaras Realty, according to her LinkedIn profile, is listed as the sole member of Yellowhook Realty, records show. Psaras did not respond to a request for comment. And a manager at Bridgeview who answered the phone Tuesday but declined to provide his name, said he has "no idea" what the new owner's plans are for the property.
Attempts to reach Kaloidis' estate were unsuccessful. A message left with Powers was not returned. And an attorney for the buyer, Gerasimos Liberatos of the Manhattan-based law firm Sitaras & Associates did not respond to a request for comment.
The sale comes just a few weeks after the beloved Neptune Diner in Astoria shuttered for good.
Developer Legion Investment Group, which has taken the luxury condo market by storm in the seven years since its founding, has scored major backing for its next project.
Deutsche Bank has pledged $195.1 million in construction financing for Legion’s 1122 Madison Ave., a planned 18-story, 22-unit project at East 84th Street on the Upper East Side.
The hefty loan, which closed July 26, according to a mortgage filing that appeared in the city register Monday, gives shape to a project that has been slow to roll out and somewhat shrouded in secrecy.
Since at least 2019, Legion and its partner, Nahla Capital, a real estate-focused, Midtown-based private equity firm, have been assembling the pieces of the corner development site. Their first two purchases that year appear to have been 24 E. 84th St., a skinny, mixed-use rowhouse, for $10 million; and 1122 Madison, a small retail space that once contained a Halston boutique, for $22.5 million, the register shows.
All told, the project is made up of six parcels, including a portion of the lot occupied by 18 E. 84th St., a 5-story, prewar co-op building. The most recently acquired site was 1128 Madison, a former James Perse boutique, which traded for $22 million earlier this year.
The project has not yet been approved for a permit by the Department of Buildings, filings show, though Legion appears to be going back and forth with officials there to address some objections; Legion last modified its plan in May.
But as things stand today, the tower would stretch 210 feet tall, offer 113,000 square feet of space and also feature storefronts, according to its permit application. Hill West, a Financial District-based firm with many New York residential towers to its credit, would be the architect.
Neither Victor Sigoura, Legion’s founder and chief executive officer, nor Jitendra Jain, Nahla’s development director, could be reached for comment by press time.
Legion burst onto the development scene with nearby 109 E. 79th St., a 31-unit condo near Park Avenue that began selling during the pandemic, which managed a $446 million sell-out, with many deals involving Wall Street-linked buyers, in three years. Since then Sigoura has made moves toward creating what appear to be similar projects in Gramercy, Greenwich Village and West Chelsea.
Sigoura formerly worked for the luxury developer Naftali Group before exiting the company under acrimonious conditions and sparring in court over money and trade secrets with its leader, Miki Naftali.
For its part Nahla Capital, whose managing principal is Genghis Hadi, has invested in development projects across the county, including in Austin, Texas; San Francisco; and Los Angeles, according to its website. Locally, it has teamed with Naftali on 221 W. 77th St., a 25-unit condo site on the Upper West Side developed in the mid-2010s, when Sigoura was still an executive with the firm.
Leases
Real estate firm extends Fred French building lease
Address: 551 Fifth Ave., Manhattan
Landlord: The Feil Organization
Tenant: Jonathan Rose Cos.
Lease size: 11,300 square feet
Lease length: 10 years
Asset type: Office
Brokers: Cushman & Wakefield's John Fitzsimons and Giorgio Versea represented the tenant. Andrew Wiener, Kevin Driscoll, and Henry Korzec represented the landlord in-house.
Corporate consulting firm inks Fifth Avenue lease
Address: 505 FIfth Ave., Manhattan
Landlord: Stawski Partners
Tenant: F.W. Cook & Co.
Lease size: 10,717 square feet
Asset type: Office
Brokers: Cushman & Wakefield's David Mainthow and Nick Masi represented the tenant. JLL's Diana Biasotti represented the landlord.
Café takes space at 25 Kent
Address: 25 Kent Ave., Brooklyn
Landlord: Rubenstein Partners
Tenant: Pura Vida Miami
Lease size: 4,089 square feet
Lease length: 10 years
Asset type: Retail
Brokers: Newmark teams represented the tenant and the landlord.
Sales
Prospect Heights parking garage near Barclays Center changes hands
Addresses: 105 Underhill Ave. and 326 St. Mark's Ave., Brooklyn
Seller: Steven Brauser
Buyer: Ido Paul Amit
Sale price: $11.7 million
Asset type: Industrial
Piece of Cake movers acquires Long Island City warehouse
Address: 10-15 46th Ave., Queens
Seller: Bonita Tarkenton
Buyer: Vojin Popovic
Sale price: $12 million
Asset type: Industrial
A City Council push to tighten hotel regulations continues to roil the city’s hospitality industry, and has exposed divisions within the orbit of the powerful labor union backing the bill.
Manhattan councilwoman Julie Menin is moving ahead with her bill that would require hotels to have a license to operate in New York City; among other things, the bill would limit hotel owners’ ability to hire subcontracted, non-union workers. After canceling a planned hearing last week due to industry pushback, Menin announced Friday that she had amended the bill to clarify that hotel-based restaurants and bars would not be affected, and to allow security staff to still be subcontracted.
But the hotel industry has been unmoved by that compromise. Leaders insist the bill would force hotels to close, jack up prices and result in layoffs, and a subset of hotel owners incensed by the bill went public on Sunday with plans to fund a $20 million lobbying campaign against it.
The battle over the bill has revealed differences between the current and former leadership of the Hotel and Gaming Trades Council union. Peter Ward, the former HTC President, and Neal Kwatra, its former political director, are advising some hotel owners wary of the bill, people familiar with the dynamic told Crain’s. The pair built the union into a political force and now work as consultants.
Meanwhile, the current HTC leadership under Rich Maroko is pushing for hotel licensing.
Ward and Kwatra maintain that they are only advising longtime clients and that they are not working for the group mounting a campaign against the bill, who call themselves the Hotel Owners of New York. A source close to Ward and Kwatra argued that the bill would have “real unintended consequences and comes at a moment when the health of the industry is just recovering from Covid and the fears of a recession are very real.”
“Their goal is to keep the labor-management partnership they helped build stay on track for both workers and the industry,” the source added of the two former union officials. “The [hotel] owners are on war footing and I think it’s fair to say they want to help to avoid any further damage to the tenuous labor-management partnership they both helped build.”
Maroko, the current president of HTC, defended the bill in a statement on Friday as “responsible public policy,” and said it would offer “effective protections for hotel guests, communities, and workers.” People close to HTC who support the bill cast the opposition campaign as the work of anti-union hotel owners.
Menin has similarly defended it as a modest effort to improve safety in the wake of rising consumer complaints against the city’s existing hotels. Other sections of the bill would require hotels to create “panic buttons” for employees to press when they spot danger and task hotels with creating a “sanitation policy” that describes how they clean surfaces and mitigate rodents.
Menin, who represents the Upper East Side, is also widely expected to run for City Council speaker in 2026, a contest in which labor support can be crucial. But she has denied that securing support from HTC was a factor in her decision to sponsor the bill.
Despite the uproar, support for the legislation has only grown in recent days: as of Monday, it had secured 31 sponsors, five more than last week and just shy of a veto-proof supermajority. One City Council member said Monday that members were being barraged with calls from HTC, hotel owners, and the industry trade group Hotel Association of New York City.
The bill has scrambled allegiances in other respects. The lawmakers sponsoring the bill include both progressives and Republicans, while other supporters include both the conservative Police Benevolent Association union and all five of the city’s district attorneys. (The hotel industry is arguing against the public safety rationale for the bill; in a letter to the DAs on Monday, the American Hotel and Lodging Association said most 311 complaints about hotels were limited to minor problems like illegal parking and elevator outages.)
The association had asked Menin to avoid taking action on the bill until at least October, to allow more time for negotiations. But industry leaders said that the amended bill released Friday did nothing to resolve their concerns.
“The authors of this bill continue to act in bad faith, making changes without any expert input from the industry after claiming they would pause to discuss the bill’s many flaws,” Vijay Dandapani, the association’s president and CEO, said in a statement. “This legislation has been crafted with politics in mind, not policy — dooming it to fail and harm the tourism industry, putting thousands of workers and hundreds of businesses at risk. The promoters of this bill say it would help working people, but it would in fact hurt far more workers than it would help.”
Defunct luxury condo developer HFZ Capital Group has pleaded guilty to multiple charges of grand larceny and tax fraud in the sprawling criminal case brought against it by the Manhattan District Attorney's Office.
HFZ pleaded guilty Friday to three felony counts of grand larceny and one felony count of criminal city tax fraud, according to the DA's office. The corporation was sentenced to an unconditional discharge, meaning it will not face any major fines or punishments apart from the conviction itself.
The DA's office indicted multiple executives at HFZ and the construction firm Omnibuild earlier this year for an alleged $86 million fraud scheme that it claims former HFZ Managing Principal Nir Meir masterminded. HFZ project manager Louis Della-Peruta pleaded guilty to a misdemeanor charge of falsifying business records in May and was sentenced to a $1,000 fine, but the cases against all other individuals remain open, according to the DA's office.
Ziel Feldman, who ran HFZ with Meir for years, has not been charged with any wrongdoing. He has consistently pinned the blame for the firm's problems entirely on Meir, and the attorney for HFZ stuck to this explanation during Friday's court appearance, according to Law360, which first reported the news.
"The corporations that Nir Meir corrupted and destroyed are pleading guilty," HFZ attorneys Ramsey Hinkle and Charles Clayman said in a joint statement.
HFZ was behind some of the highest-profile condo projects in Manhattan prior to its collapse, including the Belnord on the Upper West Side and the XI on 11th Avenue, now known as 1 High Line. However, the firm became embroiled in countless lawsuits and controversies starting around 2020, culminating in the February indictment from the DA's office.
The office has accused Meir of leading a scheme that allegedly included forging bank statements to inflate HFZ's assets, stealing money for a project in San Francisco that did not exist and spending money that was supposed to be for the XI on different developments. Meir pleaded not guilty to the charges against him in February and is currently being held on Rikers Island.
Meir's attorney, Oliver Storch, stressed that his client has not yet had his day in court , and any issues raised by HFZ's guilty plea would be addressed then. He also slammed the firm for trying to pin all of its woes on Meir once its deals started going south.
"We ask the public to withhold judgment until Mr. Meir's case has been properly addressed in the appropriate forum," he said.
Omnibuild was HFZ's construction manager on the XI, and the DA's office claims the firm took part in the alleged scheme by making it appear to the lender as if it were further along on the development than it really was, causing the lender to give HFZ more funding. Former Omnibuild co-CEO John Mingione was among those indicted in the case, and he resigned from the company earlier this year.
The construction firm has vigorously maintained its innocence in the case so far. It filed a $350 million civil lawsuit against HFZ and its lenders, arguing that it repeatedly tried to sound the alarm about financial problems at the XI but was always ignored. And its attorney, Marc Agnifilo, wrote a letter to the DA's office in the spring outlining what he saw as several problems with the case.
"Omnibuild and John Mingione have maintained consistently that HFZ lied to them, stole from them and defrauded them," Agnifilo said. "So this guilty plea by HFZ is further evidence of our position. We did nothing wrong, and the evidence continues to bear this out."
A condo owner who played a key role in creating former President Donald Trump’s Truth Social app is looking to flip his Upper East Side home without ever having moved in.
Joseph Rallo, an investment banker whose firm underwrote the $288 million public offering of Digital World Acquisition Corp., a move that generated enough capital to acquire Trump Media & Technology Group and in turn pave the way for its social media platform, has listed his five-bedroom penthouse at 109 E. 79th St., according to an online listing.
The asking price of the condo, No. PH19, which offers a library, a formal dining room and two outdoor spaces, is $32.5 million.
In 2023 Rallo and his wife, banking executive Ashley Rallo, purchased the unit for $25 million, helped by a $16.2 million mortgage from Los Angeles’ City National Bank, according to the city register. But the Rallos never stayed in the unit, according to the ad copy for the listing, which features photos of empty rooms.
Now a year later the couple appears to be betting that the residential sales market is strong enough to warrant a 30% markup.
Developed by Legion Investment Group, a young firm that has emerged as one of New York’s most active developers of the past few years, 109 E. 79th has been known for big-ticket deals en route to a $446 million sell-out of its 31 units, which were approved for sales as the pandemic raged in fall 2020. The company is headed by Victor Sigoura, a former executive with the rival luxury developer Naftali Group.
But the test of the building’s long-term value might lie in the strength of its resales. Rallo is the second buyer at the 20-story building, which opened in 2022 and sold its final sponsor unit in 2023, to attempt to offload a unit. In June the owner of No. PH16, a shell company that paid $28.1 million in 2022, according to the city register, listed a five-bedroom for $38 million, a 35% hike; it has not found a taker yet.
At the time of Digital World’s 2021 offering, which resulted in the sale of 25 million shares, Rallo’s year-old firm was called Kingswood Capital Markets. But later that year Rallo snapped up the rights to the defunct brand EF Hutton, a longtime brokerage known for its 1970s TV commercials, and slapped its name on his firm.
In winter 2022 Truth Social’s app went live. In March of this year, Trump Media shed its association with Digital World and began trading on the Nasdaq index as its own company under the letters DJT. Its share price was $27 on Monday, after being as high as $80 and as low as $13.
On the LinkedIn feed belonging to Rallo, who serves as EF Hutton’s chief executive officer, there's a photo from a 2022 meeting that features himself, firm president David Boral and Trump.
Stephen Ferrara, the Compass agent marketing Rallo’s apartment, had no comment by press time. And an attempt to contact Rallo through EF Hutton was unsuccessful.
Vice President Kamala Harris tapped Minnesota Gov. Tim Walz as her running mate, enlisting him to build a coastal and Midwestern electoral coalition to block Donald Trump from returning to the White House.
“Tim is a battle-tested leader who has an incredible track record of getting things done for Minnesota families,” Harris wrote in a text message sent to supporters Tuesday. “I know that he will bring that same principled leadership to our campaign, and to the office of the vice president.”
The pick hews to the conventional wisdom of ticket-balancing, complementing Harris — who hails from California and is seeking to become the first Black woman president in U.S. history — across demographic, cultural and political lines.
Harris is expected to appear alongside Walz at a rally later Tuesday in Philadelphia. She called Walz in the morning and was set to speak with other finalists, who also include Pennsylvania Gov. Josh Shapiro and Sen. Mark Kelly of Arizona.
Walz, 60, is less known nationally but popular in his home state, especially among the 91% of Democratic voters who approve of his job performance — the third-highest of any state, according to a July Morning Consult poll.
Harris had little time to settle on a vice presidential pick after President Joe Biden’s exit from the race. Polls show a tight race. A July Bloomberg News/Morning Consult survey found Harris has wiped out Trump’s lead among voters in seven battleground states with the Democrat now ahead 48% to 47% — a statistical dead heat.
Representatives for the Harris campaign did not immediately respond to a request for comment and Walz’s office declined to comment. The decision to pick Walz was first reported by CNN.
Centrist Democrat
A native of rural Nebraska, Walz joined the Army National Guard and rose to the rank of command sergeant major, serving during the early years of the global War on Terror. He worked as a teacher — on a Native American reservation and in China — before finally settling down in Minnesota and running for Congress.
He served six terms in the House, where he focused on military, veterans and agricultural issues — allowing him to neutralize Harris’ relative lack of experience in those areas and deliver a message that might resonate with voters outside the Democratic base. His voting record was slightly to the right of the typical House Democrat.
One issue where he differed from Democrats was over gun rights, where his lifelong devotion to shooting sports and voting record earned him an endorsement from the National Rifle Association. But after a 2018 school shooting in Parkland, Florida, Walz called the NRA “the biggest single obstacle to passing the most basic measures to prevent gun violence in America.” He says he supports universal background checks, “red flag” laws and an assault weapons ban.
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Now serving his second term as governor, Walz presided over the upheaval that followed the 2020 murder of George Floyd by a Minneapolis police officer. After initial criticism that he was slow to respond, Walz called up the National Guard and summoned two special sessions of the state legislature to pass police reform legislation.
As Harris weighed her choices, Walz was pushed by progressives and labor-union leaders who touted his policies as governor, including offering free school lunches, expanding paid family and medical leave — a background Democrats hope will appeal to voters in an election in which the economy is a defining issue.
The governor’s image as a plain talker also helped bolster his standing. Walz mocked Trump and Republican policies as “weird,” an insult that became a rallying cry for Democrats.
Walz was also championed by lawmakers he served with in the House. Former Speaker Nancy Pelosi praised the selection on Tuesday.
“He brings the security credential, he brings the rural credential and he will do well in rural America,” Pelosi said on MSNBC.
Minnesota economy
Walz will be critical to Democratic messaging in battleground states where their prospects hinge partly on the ability to appeal to White, working-class voters dismayed by Biden’s handling of the economy.
Voter anxiety over high inflation and concerns about rank-and-file union workers about the impact Biden’s transition to clean energy, particularly electric vehicles, will have on jobs and wages threaten to weigh down the Democratic ticket.
Trump’s running mate, Senator JD Vance of Ohio, brings a populist worldview and a message Republicans believe will help them make further inroads among blue-collar workers.
Walz’s own record in Minnesota will be under scrutiny. Minnesota was among the few states that saw a drop in gross domestic product growth in the first quarter after tepid expansion in 2023. The state has an aging population and has struggled to attract workers over the past two decades. Its total labor force is projected to remain essentially flat this decade, inhibiting job creation and GDP growth, according to the Minnesota Chamber of Commerce. The unemployment rate of 2.9% in June, though, was one of the lowest in the US.
The state has been a reliable source of Democratic electoral votes, going blue in every election since Richard Nixon last won it for Republicans in 1972. That’s the longest Democratic winning streak outside of the District of Columbia. Republicans had identified the North Star state as a top opportunity for Trump ahead of Walz’s selection.
The governor’s support among progressives and his record as governor, though, will amplify Republican attacks that the Democratic ticket is too liberal for American voters.
“Just like Kamala Harris, Tim Walz is a dangerously liberal extremist,” Trump’s campaign said in a statement.
Google illegally monopolized the search market through exclusive deals, a judge ruled Monday, handing the government a win in its first major antitrust case against a tech giant in more than two decades.
Judge Amit Mehta in Washington said that the Alphabet Inc. unit's $26 billion in payments to make its search engine the default option on smartphones and web browsers effectively blocked any other competitor from succeeding in the market.
"Google's distribution agreements foreclose a substantial portion of the general search services market and impair rivals' opportunities to compete," Mehta said in a 286-page ruling.
By monopolizing distribution on phones and browsers, Google has been able to consistently raise the prices of online advertising without consequences, Mehta said.
"The trial evidence firmly established that Google's monopoly power, maintained by the exclusive distribution agreements, has enabled Google to increase text ads prices without any meaningful competitive constraint," he wrote.
Antitrust enforcers alleged that Google has illegally maintained a monopoly over online search and related advertising. The government said that Google has paid Apple, Samsung Electronics Co. and others billions over decades for prime placement on smartphones and web browsers. This default position has allowed Google to build up the most-used search engine in the world and fueled more than $300 billion in annual revenue largely generated by search ads.
Alphabet shares slid almost 4.5% to $159.25 at the close in New York. Apple Inc., which depending on the remedy could stand to lose billions in payments Google makes to have its search engine be the default browser on iPhones, fell 4.8% to $209.27.
"This victory against Google is a historic win for the American people," said Attorney General Merrick Garland. "No company -- no matter how large or influential -- is above the law. The Justice Department will continue to vigorously enforce the antitrust laws."
Google said it plans to appeal the decision. "As this process continues, we will remain focused on making products that people find helpful and easy to use," Kent Walker, President of Google Global Affairs, said in a statement.
Mehta found that Google doesn't have a monopoly in the market for general search advertising, noting that competitors like Amazon.com Inc., Walmart Inc. and other retailers have begun to offer advertising related to searches on their own websites. But Google does have a monopoly over search text ads, which appear at the top of a search results page to draw users to websites, he said.
Mehta's decision focuses solely on Google's liability, nine months after the Justice Department and a group of states held a 10-week trial in federal court. Mehta scheduled a hearing for next month to discuss the timing for a separate trial on the remedy.
The Justice Department hasn't yet said what changes it will seek, though it presented evidence that efforts by European regulators to require Google to offer users a choice of search engines led few to switch. The agency could demand the separation of Alphabet's search business from other products, like Android or Chrome, which -- if ordered by the judge -- would mark the biggest forced breakup of a US company since AT&T was dismantled in 1984.
The judge could also stop short of ordering a full breakup and chose to unwind the exclusive search deals. Another option could be to require Google to license its search index, which is the data that it uses to build its search results.
Antitrust enforcers separately sued Google for allegedly monopolizing the technology used to buy, sell and serve display advertising online. In that case, which is set for trial in Virginia federal court next month, the government is seeking to force Google to sell off some of its advertising technology products.
Dan Morgan, a senior portfolio manager at Synovus Trust, said the decision adds to the "black cloud" of legal and regulatory uncertainty that has been hovering over the company.
"It does create some doubt in a company that already kind of disappointed on the quarter," he said.
'Measured' Decision
Mehta's decision is "reasonable and balanced," accepting some but not all of the government's arguments, which will likely help in any appeals, said William Kovacic, who teaches antitrust at George Washington Law School.
"His decision is measured and not simply a credulous acceptance of the government's arguments," said Kovacic, who served as chair of the Federal Trade Commission during the George W. Bush administration.
Some of the Mehta's analysis about advertising markets may raise difficulties for the government as it pursues its second case against Google, Kovacic said. But the opinion will likely be helpful for a number of the government's other antitrust cases awaiting trial against Apple, Amazon and Meta Platforms Inc. on how to consider justifications by the companies for their behavior, he said.
Mehta's decision is "bold in a legally careful way that will do well on appeal," said Rebecca Allensworth, an antitrust professor at Vanderbilt Law School. It will "lay the blueprint for other tech cases going forward."
Crypto startup Concrete recent decamping to the Meatpacking District from the San Francisco Bay Area may be emblematic of a budding digital-asset renaissance in the Big Apple.
More than a dozen crypto-related companies, big and small, have opened or are planning to open offices this year. Much of the change is due to the overall sentiment toward crypto becoming more favorable as the sector recovers from several years of turmoil. Then there’s Silicon Valley turning its attention to the latest hot sector — artificial intelligence.
The last crypto bear market combined with a heightened regulatory crackdown led to an exodus of crypto startups and founders from the city over the prior two years. Since then, the U.S. Securities and Exchange Commission was hit with setbacks in its prolonged battles with the industry. The approval and launch of Bitcoin exchange-traded funds earlier this year have also been heralded as a landmark event for the sector.
“I think very bullish [of] the current outlook,” said Concrete CEO Nic Roberts-Huntley.
The industry is also hoping that the upcoming presidential election will lead to a more crypto-friendly White House. Once a critic of the industry, former President and Republican presidential candidate Donald Trump has now become one of Bitcoin’s biggest cheerleaders.
“Obviously, if we see a Republican administration come in, it seems as that might be more bullish for crypto more broadly, which is fantastic,” said Roberts-Huntley.
Many well-known crypto leaders including crypto exchange Kraken’s co-founder Jesse Powell, and Tyler and Cameron Winklevoss, co-founders of New York-based crypto exchange Gemini, have announced that they’ve donated to Trump.
“Everyone else is just following and saying like, oh, this seems good for crypto,” said Mirza Uddin, head of business development at blockchain startup Injective Labs, from his office in the Flatiron District. “That’s why I think the narrative has shifted like in recent months, even in New York.”
Currently, over 130 crypto firms have New York offices, with 20 specifically targeting decentralized finance, 14 in nonfungible tokens and 13 in centralized finance such as crypto exchanges, according to crypto venture fund Archetype, which tracks crypto-related firms based in the city.
“New York City has always been thought as the financial capital…the fashion capital, it’s a culture capital,” so as crypto expanded it’s only natural for it to be easier to build and hire in the city, said Katherine Wu, a venture partner at Archetype.
Venture fund Foresight, blockchain project Plume, and Seattle-based Eigen Labs — which recently received $100 million from Andreessen Horowitz — plan to open New York offices in 2024.
They will be joining crypto asset manager Superstate, crypto community focused program Hadron FC, algorithmic crypto platform Tread.fi and digital-asset venture funds Dragonfly and Blockchain Capital. All have set up shop in New York this year.
A week after Concrete moved into the Meatpacking District last month, venture capital fund Coinfund hosted a happy hour that more than 300 crypto enthusiasts registered for a stone’s throw from Concrete’s office.
Even The Science of Blockchain Conference, which has been historically hosted at Sanford University since its inception in 2017 will be taking place in New York at Columbia University this month.
“I, as a founder, just gravitate where other founders are innovating on the same space,” said Zorayr Khalapyan, co-founder of Blackwing, who lived in the Bay Area for years. “We saw more crypto companies being built in New York.”
San Francisco focuses more on AI and if he was building a company in that space, Khalapyan said they would still be there. He also spent time overseas in countries including South Korea, Singapore and Vietnam, before finally moving to New York last June.
Déjà vu
The crypto wave is reminiscent of 2021, when Coinbase set up its first New York office in Hudson Yards and Ava Labs, the firm behind Avalanche blockchain, opened a permanent office in the city. That year even Mayor Eric Adams vowed to make New York a crypto hub.
Back then, there were a lot of founders and trading firms moving to the city, recalled Tarun Chitra, a long-time resident who runs his crypto risk model firm Gauntlet in Manhattan.
There’s even a “Crypto Alley” in the neighborhood of SoHo, where a high concentration of crypto firms like Uniswap Labs, dYdX Trading, OpenSea reside, according to Archetype’s Wu. Archetype is also in the area.
New York state maintains some of the strictest crypto regulations in the country. Since 2015, the state requires digital asset providers to obtain a license under a program called BitLicense, which led to an exodus of crypto firms including Kraken.
Whether the newfound enthusiasm will last remains to be seen. There are several uncertainties when it comes to the outcome of the presidential election and what could happen even if Trump wins.
“It’s a bit too early to see those sort of downstream effects yet,” said Tom Schmidt, a general partner at Dragonfly. “This sort of sentiment shift in politics has happened in the past four months or so, I don’t even know what kind of meaningful policy changes are going to sort of happen downstream.”
Mental health company Talkspace has inked a contract with a government-sponsored insurance plan to offer in-network therapy to active duty military, retirees and their families, marking the company’s latest agreement with a public health insurance plan.
The Upper West Side-based company announced Monday that it will provide in-network mental health services to people enrolled in Humana Military, a health plan that administers the federal program that insures members of the military and their families, called Tricare East. The plan enrolls 6 million individuals who live across 32 states in the eastern U.S., according to Talkspace.
The contract terms offer in-network telehealth appointments, therapy sessions for couples and teens, and text-based mental health sessions to military members, their partners and teen dependents. They will be able to access care at a co-pay ranging from zero to $50 per session, said Erin Boyd, chief growth officer at Talkspace.
The deal marks Talkspace’s most recent attempt to expand its offerings to people enrolled in publicly funded health insurance plans. The company, which brought in $150 million in revenue last year, began offering in-network virtual therapy sessions to Medicare enrollees in May, opening up low-cost mental health services to 13 million U.S. seniors.
Talkspace decided to expand to military members to fill what it says are gaps in access to care among troops and their families. Nearly a quarter of active-duty military members experience depression, and rates of suicide have increased 40% in recent years, according to Talkspace.
“There’s a great deal of need,” Boyd said in an interview, adding that the company’s offerings are fit for the needs of military members with hectic schedules and unpredictable workdays. Talkspace’s asynchronous mental health services, for example, allow members to connect with a therapist over text rather than during a live call or chat, especially those who are deployed, Boyd noted.
Talkspace has roughly 6,000 therapists in its network, but clinicians need a special certification to serve people enrolled in Tricare, Boyd said. She did not provide a specific percentage of Talkspace providers who were certified to treat military members, but said a sizable subset of the company’s therapists were cleared.
The company is continuing to expand its network, and is planning to offer in-network services to Tricare West in the coming months, Boyd said.
PLANNED PARENTHOOD: Planned Parenthood of Greater New York will stop providing abortions at 20 or more weeks beginning Sept. 3 due to financial constraints. The organization will also no longer offer deep sedation for patients seeking intrauterine devices and surgical abortions, according to The City, which first reported the change. The provider has blamed its constricted finances on the state Legislature’s failure to increase Medicaid rates last year. New York state allows abortions up to 24 weeks with exceptions when the health of the pregnant person or fetus is at risk.
FIREWORK POLLUTANTS: Air pollutants from Fourth of July fireworks last year were worse than the particles that blanketed New York City after Canadian wildfires, according to a new study from NYU Langone. The study, which assessed air and water quality around detonation sites, also found levels of lead, nickel and other toxic metals more than doubled in the East River, where the 2023 fireworks were set off. A previous NYU study found the Fourth and New Year's Eve have historically had the highest levels of air pollutants in New York.
PRENATAL CARE: Northwell Health's Katz Women's Hospital is the second institution on Long Island to be awarded an advanced certification in perinatal care by the Joint Commission, a nonprofit health care accreditor. The new certification focuses on prenatal and postpartum care for both complicated and uncomplicated pregnancies. Katz Women’s Hospital is one of just 36 facilities nationally to receive the certification, which also emphasizes early identification of high-risk pregnancies and births.
STORY CLARIFICATION: This story, which ran on July 31, has been updated to clarify that state health regulators previously approved a buyer that is interested in purchasing the Cold Spring Hills Center for Nursing and Rehabilitation to operate a different nursing home, but a new owner has not been formally approved.
Hospitals in the tristate area are seeing stable profits after a challenging few years, but they are still lagging behind facilities across the country, a new report shows.
Hospitals in New York, New Jersey and Connecticut had a median yearly operating margin of 2.6% through June, up 19% on average since the same time last year, according to a monthly report released Monday by Chicago-based consulting firm Kaufman Hall.
But even as profits increase, local facilities have trailed behind hospitals nationwide. The median operating margin nationwide was 4.1% as of June, according to the report, which is based on financial data from 1,300 hospitals across the U.S.
“New York’s been a little slow,” said Erik Swanson, senior vice president of data and analytics at Kaufman Hall. More patients are going to hospitals for care now compared to during the pandemic, but higher costs and competition from outpatient clinics in New York City has created obstacles for local hospitals that are trying to bounce back, he said.
The rise in hospital profits comes on the heels of a rough few years of financial recovery in the wake of the pandemic. Many hospitals have struggled to meet the rising costs of labor, drugs and other supplies since the pandemic began.
The number of patients in tristate-region hospitals has started to tick up. Discharges, often used to track hospital payments, were up 5% between June of this year and June 2023. As discharges increased, the average amount of time a patient stayed in the hospital declined by 1.5%, representing lower expenses for hospital stays.
Emergency room visits were also up 5% since June 2023, data show. Some of that uptick is due to seasonal shifts that occur in the summer, when patients are more likely to get injuries from outdoor activities, as well as an uptick in Covid-19 infections, Swanson said.
Regional hospitals have maintained profits even as they continue to manage expenses. Total expenses among tristate-area hospitals declined slightly by 0.1% as of June, with larger declines in supply and drug expenses, according to the data.
Larger hospitals with stronger profits are more likely to withstand cost pressures compared to smaller and midsize facilities – some of which are still struggling to break even, said Elisabeth Wynn, executive vice president of finance and economics at the Greater New York Hospital Association, which represents nearly 280 hospitals in New York, New Jersey, Connecticut and Rhode Island.
Labor expenses have eased in recent months as hospitals have curtailed how much they spend on contract labor. But workforce challenges are still an “enormous pain point” for facilities in New York that struggle to hire nurses and technicians who work in labs and pharmacies, Wynn said.
“It is not just the nursing shortage,” Wynn said. “It is much more widespread.”
Hospitals are looking to the state’s $7.5 billion Medicaid 1115 waiver, a pilot program that will test ways to spend Medicaid dollars in the coming years, to boost the health care workforce, Wynn said. The program includes a workforce-training initiative that is expected to offer tuition assistance to health care workers who commit to working at Medicaid provider hospitals after graduating.
Jamaica-based Venture House is the latest provider to receive a boost in city funding for mental health clubhouses under a contentious expansion of the program that has left some contractors out in the cold.
The $91 million contract, awarded by the Department of Health and Mental Hygiene on Wednesday, enlists the social service agency to open two new clubhouses on top of the two it already operates. Clubhouses function as drop-in centers for people with a mental health diagnosis, where work, socializing and therapy intermingle.
The programs have gained traction in recent years as an option for people with severe mental illness, coming to a head when Mayor Eric Adams tapped Dr. Ashwin Vasan, then-CEO of clubhouse provider Fountain House, to lead the Health Department. The latest award is part of an effort to expand clubhouse enrollment citywide with $30 million and new stipulations about the number of enrollees and types of services offered. While city health officials have maintained that the change will help reach more people and create common standards across providers, the stricter criteria meant some smaller and more specialized clubhouses would not be able to qualify.
The city hopes to increase citywide enrollment by 3,750, or 75%, with the new investments in Venture House. In total, the city will fund 13 clubhouses, mostly in neighborhoods identified as high-need, according to health department spokeswoman Rachel Vick. That is three fewer locations than last year.
Venture House already holds a $23.8 million contract with the city for its two clubhouses in Jamaica, Queens, and Port Richard, Staten Island. Its flagship site in Jamaica has been open for more than three decades and has 450 enrolled.
The new contract extends that operation to 2033 and expands it to two more high-need locations in the Bronx and Brooklyn – which must be built from scratch, according to Venture House CEO Juliet Douglas. Ultimately, Venture House must enroll 1,800 across its four sites.
The new growth won’t be easy for Venture House, Douglas said. The organization had to identify 12,000 square-foot spaces to accommodate the need; the Queens and Staten Island sites are smaller at 8,000 square feet each. The sites also must have an industrial-grade kitchen and outdoor space to host the programming and work opportunities needed to fulfill their mission. Venture House has found a lease for a location in the Belmont section of the Bronx, but it needs to be renovated, Douglas said. She added that two other sites in Brooklyn are promising but each has its drawbacks.
While the contract is for programming and staff, the city is permitting funding in the first year to go toward capital expenses, according to Douglas. That will enable Venture House to build the new space that it will use over the 10-year life of the contract.
Douglas noted the new higher enrollment criteria should not, by itself, be a barrier for small providers seeking city funding, even if other standards made some ineligible.
“There is no smaller clubhouse than the one you’re building from scratch,” she said. “All those people that are lamenting, they could have applied and been in the same boat that I’m in. There’s no magic to it.”
U.S. equities plunged on Monday, part of a wave of selling globally, as investors braced for days of volatility amid rising concerns over a slowing U.S. economy and overheated gains in the technology sector.
The S&P 500 Index sank 3%, its biggest one-day drop since September 2022, and the tech-tracking Nasdaq 100 Index slid by a similar amount. Both benchmarks pared losses from earlier in the session after a report on the services industry was stronger than projected, easing worries about the economy.
Meanwhile, the VIX Index of stock-market volatility soared, at one point reaching the highest since early 2020. The day’s turbulence is an extension of last week’s losses, after a soft jobs report fueled worries that the Federal Reserve isn’t moving fast enough to prevent a sharp economic downturn.
“There are so many people who were overly long risk and short volatility and the game now stopped,” said Matthew Rowe, head of cross asset strategies at Nomura Capital Management. “There’s still a lot of uncertainty ahead on many levels: monetary policy, geopolitical, the outcome of an election. And equities coming from a point of valuations that were historically very high.”
Megacap tech high-fliers bore the brunt of the losses, with the Bloomberg Magnificent 7 Index at one point plunging the most since 2015 amid a rout in names including Nvidia and Apple, both of which trimmed losses on the day.
Concerns over the health of the U.S. economy took center stage after data Friday showed rising unemployment levels in July, triggering a closely watched recession indicator.
“With the summer low liquidity, the still heavy trend plays that need unwinding and the VIX sky-high, this selloff move could go on for a few days,” said Florian Ielpo, head of macro research at Lombard Odier Asset Management. Still, “the macro picture itself is not as bad as the market seems to think.”
News that Warren Buffett’s Berkshire Hathaway slashed its stake in Apple by almost 50% in the second quarter also drove risk-off sentiment in the tech sector. Slow monetization of AI tools — a long-standing concern among tech investors — persists as the first preview of Apple Intelligence failed to live up to the hype.
The AI supply chain was dealt another blow amid reports that Nvidia’s highly anticipated Blackwell chips will be delayed due to design flaws. The chips may be postponed by three months or more, which could potentially hit big tech firms from Meta to Microsoft, the Information reported.
“When sentiment begins to sour, the falls become more extreme than perhaps they should be,” said Ben Barringer, an analyst at Quilter Cheviot. The next few weeks ares likely to be volatile for tech stocks, he said.
Most New York City restaurants taking part in the city’s pandemic-era outdoor dining program haven’t sought permits to make their sheds permanent, meaning they’ll have to be dismantled.
About 2,600 dining establishments applied for the permits before the Aug. 3 deadline, according to the city Department of Transportation. That’s less than half of the agency’s estimate of 6,000 to 8,000 restaurants currently using outdoor dining permits issued since 2020.
The deadline for eateries caps months of heated debate among various stakeholders over how or whether to maintain a slice of the vibrant outdoor dining culture that flourished during the pandemic. Critics call the structures eyesores that attract rats and take up parking spaces, while proponents say they inject life into the urban landscape and boost small business operators.
Under the new program, known as Dining Out NYC, roadway sheds must be taken down and stored from the end of November through March, which some restaurants say is cost prohibitive. Operators must also meet certain specifications for the structures, such as not being fully enclosed, which would require some businesses to rebuild them.
The city argues the regulations are needed to maintain safety and order for longer-term fixtures, which weren’t permitted in streets before the pandemic.
Just over 1,300 of the new permit applications are for roadway sheds, while about 2,000 are for sidewalk seating, which will be permitted year-round under less-stringent rules than before the pandemic. Cafes that don’t currently have outdoor seating can still apply at a later date, according to the city. Those who have sheds and haven’t requested new permits will have to take them down.
Manny Colon, owner of the popular Manny’s Bistro on the Upper West Side, signed up for roadway and sidewalk permits, which at $1,050 each for four years is half the price for permits pre-Covid. He estimates a city-approved contractor would charge $40,000 to take down his structure, build a new one to fit specifications and store it all winter.
U-Haul required
Instead, he asked a friend to cut and paint plywood and is planning to U-Haul the shed to his daughter’s house upstate to store it in the winter. Even then, it will cost $25,000, and he’ll have to cut the roadway seating in half to six tables because he said new rules prohibit the length of the shed from being longer than his storefront.
“It’s quite complicated, and that’s why a lot of restaurants are just going to focus on the sidewalk,” he said. But he still expects to turn a profit and is happy the city will rein in street sheds that were “out of control,” such as structures built so that diners stepped out precariously into busy bike lanes.
A spokesman for the city’s restaurant industry said the low number of applicants shows the program needs to be tweaked.
“There are many parts of the new outdoor dining law that are much better than the pre-pandemic sidewalk café law, but despite the Department of Transportation’s outreach and collaboration with restaurants, too small a percentage of eligible small businesses have applied to participate in the Dining Out NYC program,” said Andrew Rigie, executive director of the New York City Hospitality Alliance.
He said the city should analyze why so few restaurants applied to continue the program and make changes to the rules “to help achieve their goal of having the biggest and most inclusive outdoor dining program in the country.”
City officials say the number of restaurants that have applied is still double the amount that participated in outdoor dining before the pandemic.
“The new program preserves what New Yorkers came to love about outdoor dining while addressing important quality-of-life issues,” a transportation department spokesperson said.
Billionaire real estate developer and supermarket magnate John Catsimatidis has inked a superfluous $57 million loan for his in-the-works mixed-use project in Chelsea, city records show.
The owner and chief executive of grocery chains Gristedes and D'Agostino's, as well as the founder of Manhattan-based development firm Red Apple Group, told Crain's Monday that the roughly 100,000-square-foot project at 280 Eighth Ave. is nearly topped out and didn't "really need" financing, but he took it anyway for "good old sake."
Catsimatidis, who ran for mayor briefly in 2013, signed for the construction loan from JPMorgan Chase himself, according to documents that appeared in the city register last week and were first reported by PincusCo. Catsimatidis says he has no plans to run for mayor again next year.
The 12-story building, between West 24th and West 25th streets, is slated to include more than 100 rental apartments as well as about 6,000 square feet of retail space on the ground floor. The entire project — which sits on the site of a former Rite Aid and was home to a supermarket before that — will cost more than $100 million total to build, he said. The recent loan will go toward balancing construction costs, he said.
A bigtime donor and supporter of former President Donald Trump and his current 2024 reelection campaign, Catsimatidis said he has yet to sign a lease for the project's retail space.
"Take your choice, what would you like to see in the neighborhood?" he said. He added, however, that he has no plans to place a supermarket there.
Catsimatidis' Red Apple Group portfolio includes a 33-story luxury rental tower at 86 Fleet Place in Downtown Brooklyn known as the Eagle and a two-building, 22-story luxury rental project in Coney Island known as Ocean Drive.
The widow of Benihana chain founder Rocky Aoki is looking to cut ties with the couple’s home amid a long-running intrafamily battle over the Japanese restaurateur’s estate.
Keiko Aoki has listed their 4,200-square-foot duplex condo at Midtown’s Olympic Tower for $16.6 million, according to a new online listing.
The apartment, a combination of two adjacent units on the 33rd and 34th floors of a 51-story building, has three bedrooms, two-and-a-half baths and a primary suite with a dressing room and sauna, floor plans show.
But the kitchen seems perhaps underwhelming for a place whose former occupant elevated the basic act of cooking on a grill into a popular form of group entertainment. It is not featured in listing photos, measures 220 square feet and is described in the listing as a mere “kitchenette.”
Rocky and Keiko Aoki bought the first unit that makes up the apartment in 2003, the year after they were wedded in Rocky's third marriage, for $1.6 million, according to the city register. The couple added the second unit two years later for $2.3 million.
The apartment's location, in Olympic Tower at East 51st Street, is also near the city’s only surviving sit-down Benihana at 47 W. 56th St., between Fifth and Sixth avenues, where chefs have been dicing and slicing steaks and shrimp in close proximity to patrons since the 1980s.
Rocky, who opened his first Benihana in 1964 on the same block, died in 2008 at 69 from liver cancer. But the fight over his estate began years before and at one point led to Rocky suing four of his seven children for allegedly trying to seize control of the family’s global empire.
And in 2020, son Steve Aoki, a high-profile DJ, and daughter Devon Aoki, a model, took their stepmother Keiko to Manhattan Surrogate's Court over her allegedly squandering some of their $50 million trust fund, which Keiko oversaw for years. That case appears ongoing, according to court filings.
But there have been major moves on the food front. Earlier this year, national restaurant firm The One Group, of the Kona Grill chain, purchased Benihana parent company Safflower Holdings Corp. in a $365 million deal. Benihana currently has 105 restaurants in the Western Hemisphere, including outposts of a spin-off brand called RA Sushi, according to a statement released about the merger.
A former wrestler who came to the U.S. from Japan hoping to compete on mats, Rocky ended up driving an ice cream truck in Harlem before investing his proceeds in the first Benihana, a 28-seat offering at 61 W. 56th St. that seems to have introduced teppan grill cooking to the West. Several other Benihanas followed nearby in the 1960s and 1970s, including versions at 120 E. 56th St. and 15 W. 44th St., according to news reports. The only other Manhattan address today is a take-out eatery at 229 W. 43rd St., the former headquarters of The New York Times, although Benihanas dot Long Island and New Jersey.
In addition to his restaurant businesses, Rocky was a successful powerboat racer and often took part in a 200-mile competition off the coast of New York sponsored by his eatery chain. But he also faced legal problems and pleaded guilty in 1999 to insider trading for a transaction involving 200,000 shares in a tech firm. As punishment, he paid a $500,000 fine and received three years’ probation.
Sachiko Goodman, the agent with Douglas Elliman marketing the condo, did not reply to a request for comment by press time.
South Street Seaport has encountered some rough waters since embarking on its journey last week as a public company.
Shares in Seaport Entertainment Group have lost one-fifth of their value since they began trading last Thursday, after the enterprise was spun off from developer Howard Hughes Holdings. As of midday Monday the shares traded at a bit more than $25 each, down from their debut of $31.50 on the NYSE American Stock Exchange.
Big companies routinely spin off businesses into public companies of their own on the theory that management can focus on what’s most important and stock prices in both enterprises will benefit. Seaport Entertainment is a grab-bag of businesses, starting with a popular concert venue in the historic Manhattan district, a piece of the Jean-Georges restaurant business, a Las Vegas minor-league baseball team and its ballpark, plus air rights belonging to a mall along the Las Vegas Strip. Altogether the enterprise produced a $16 million net operating loss last year.
Howard Hughes doesn’t seem especially confident Seaport can turn it out any time soon. Last year it wrote down the Seaport’s asset value by more than $700 million because the business wasn’t generating the projected cash flow.
“Stabilization and profitability are taking longer than expected,” acknowledged Howard Hughes, which plans to focus on residential development now that it has freed itself of the Seaport.
Hughes has blamed rainy weather for keeping the crowds away from the Seaport. That sounds plausible but also doesn’t sound like a problem that’s going away considering New York is measurably wetter than it was 20 years ago due to climate change.
That’s not to say the Seaport is doomed to failure. Howard Hughes spent nearly $1 billion shoring up the landmarked 500,000 square-foot neighborhood after acquiring part of it from the Milstein family in 2018 for $180 million. Pier 17 has been remade into a popular rooftop concert venue and, after a long legal fight, work has begun to develop a 500,000 square-foot apartment tower at 250 Water St. The newly independent Seaport has new management led by a former president of MGM Resorts International. Seaport didn’t return requests for comment.
The truth is most spinoffs fail to deliver for shareholders.
For starters, newly independent companies must spend on their own management teams, internal systems and processes, creating what Wall Street calls “dis-synergies.” A study by Bain Consulting of 350 public spinoffs valued at greater than $1 billion between 2000 and 2020 found that 50% failed to produce any value for shareholders and 25% destroyed a “significant amount.”
“The evidence is overwhelming,” the researchers wrote in an article published two years ago in the Harvard Business Review.
A selloff in the riskier corners of the global market deepened, with stocks plunging and traders rushing to the safety of bonds as concerns about a slowdown in the world’s largest economy intensified.
From New York to London and Tokyo, equities got pummeled. Almost 98% of the shares in the S&P 500 got hit, with the index on track for it worst session in about two years. Losses were more pronounced in the high-flying tech space, with the Nasdaq 100 heading to its worst start to a month since 2002. A gauge of the “Magnificent Seven” megacaps like Nvidia and Apple plunged almost 10% at one point.
Just as stock markets were starting to celebrate signals from the Federal Reserve about a first rate cut, they were hit by a perfect storm: surprisingly weak economic data that’s brought back recession fears, underwhelming corporate earnings and poor seasonal trends. The repricing was so sharp that at one point the swap market assigned a 60% chance of an emergency rate reduction by the Fed over the coming week. While those odds subsequently ebbed to about 32%, the wager is a testament to investor anxiety.
“The economy is not in crisis, at least not yet,” said Callie Cox at Ritholtz Wealth Management. “But it’s fair to say we’re in the danger zone. The Fed is in danger of losing the plot here if they don’t better acknowledge cracks in the job market. Nothing is broken yet, but it’s breaking and the Fed risks slipping behind the curve.”
The wave of selling hit a fever pitch in Japan as traders rushed to unwind popular carry trades, powering a 3% surge in the yen and causing the Topix stock index to shed 12% and close the day with the biggest three-day drop in data stretching back to 1959. The rout wiped out $15 billion of SoftBank Group’s value on Monday.
Both the S&P 500 and the Nasdaq 100 fell 3%. Nvidia plunged 6.5% on a report its upcoming artificial-intelligence chips will be delayed. News that Warren Buffett’s Berkshire Hathaway slashed its stake in Apple further drove risk-off sentiment. Wall Street’s “fear gauge” — the VIX — hit the highest since 2020.
Treasury 10-year yields dropped two basis points to 3.77%. The dollar fell as the prospect of Fed easing dimmed the greenback’s appeal. Cryptocurrencies reeled from a bout of risk aversion in global markets, at one point sending Bitcoin down more than 16%. Commodities from copper and gold to oil plunged.
“Decelerating or slowing economic growth has sparked a classic flight to quality trade with short term Treasuries being the prime beneficiary,” says Gary Pzegeo at CIBC Private Wealth U.S. “What we are seeing is an unwinding of trades dependent on the higher for longer Federal Reserve theme. We will be watching the short term funding markets for signs of further damage in the near term.”
Investors should hedge their risk exposure even if they own high quality assets as US stocks extend losses, according to Goldman Sachs Group’s Tony Pasquariello.
“There are times to go for the gas, and there are times to go for the brake — I’m inclined to ratchet down exposures and roll strikes,” Pasquariello wrote in a note to clients. He added that it’s difficult to think that August will be one of those months where investors should carry a significant portfolio risk
The U.S. stock plunge is vindicating some of Wall Street’s most prominent bears, who are doubling down with warnings about risks from an economic slowdown.
JPMorgan Chase’s Mislav Matejka — whose team is among the last-standing high-profile pessimistic voices this year — said stocks are set to stay under pressure from weaker business activity, a drop in bond yields and a deteriorating earnings outlook. Morgan Stanley’s Michael Wilson warned of “unfavorable” risk-reward.
“This doesn’t look like a ‘recovery’ backdrop that was hoped for,” Matejka wrote. “We stay cautious on equities, expecting the phase of ‘bad is bad’ to arrive,” he added.
As the selloff in global stocks intensified Monday, JPMorgan’s trading desk said the rotation out of the technology sector might be “mostly done” and the market is “getting close” to a tactical opportunity to buy the dip.
Buying of stocks by retail investors has slowed quickly, positioning by trend-following commodity trading advisers has fallen a lot across equity regions and hedge funds have been net sellers of U.S. stocks, JPMorgan’s positioning intelligence team wrote in a Monday note to clients.
“Overall, we think we’re getting close to a tactical opportunity to buy-the-dip and our Tactical Positioning Monitor could dip further in the next few days,” wrote John Schlegel, JPMorgan’s head of positioning intelligence. “That said, whether we get a strong bounce or not could depend on future macro data.”
Long Island City is getting another skyscraper.
Developer Steven Li recently filed plans with the Department of Buildings for a 40-story tower at 42-19 24th St. in the bustling Queens neighborhood. The project would span about 280,000 square feet and stand 456 feet tall with 216 residential units and retail space on the ground floor, according to the filing.
The building is also addressed as 24-02 Queens Plaza South, according to PincusCo, which first reported the news. Woodside-based developer Montperia Group purchased the site from investment firm the Carlyle Group in August 2023 for $49 million, the second time in less than three years the property traded hands.
Atlas Capital Group had sold the building to Botanic Properties, a life sciences-focused real estate firm backed by the Carlyle Group, in 2020 for $40 million. Carlyle and Botanic had plans to turn the site into a commercial building spanning 270,000 square feet once Apex's lease expired but opted to sell the property instead.
The 3-story property dates back to 1949. Apex left the site last year. Li filed demolition permits for it in February, city records show.
A representative for Montperia did not respond to a request for comment by press time.
Montperia's portfolio consists largely of residential buildings in Queens and Brooklyn, along with the Wingate Hotel in Long Island City, the Alliance Tower office building in Flushing and a coworking facility in Woodside that is also where Montperia itself is based, according to the company's website.
Long Island City has seen a major influx of residential buildings in recent years, and a proposed rezoning from the city could bring up to 14,000 additional homes to the neighborhood, according to Mayor Eric Adams' administration.
Last week, Brad Lander became the highest-profile politician to announce he was running against Mayor Eric Adams.
Lander, the city comptroller, is expected to be a strong fundraiser. He has a vote-rich base in Brownstone Brooklyn and a history of winning competitive elections. Adams, who has seen his approval rating plummet since 2022, is the most vulnerable mayoral incumbent since David Dinkins in the early 1990s.
This is why Scott Stringer, the former city comptroller, and Zellnor Myrie, a Brooklyn state senator, are also looking to dethrone Adams in the Democratic primary next June. More candidates could emerge. Even Andrew Cuomo, the disgraced former governor, is rumored to be considering a bid.
Adams is vulnerable for a variety of reasons. Moderate voters question his ability to govern the city. Progressives are furious that he tried to cut the library budget, and he hasn’t prioritized the social safety net expansions of the prior mayor, Bill de Blasio.
All ideological factions are waiting to see how the federal investigation into Adams’ fundraising and possible ties to the Turkish government evolves. The sheer number of media leaks could suggest that indictments of current or former Adams aides are in the works, but no one truly knows. No sitting New York mayor has ever been indicted, and political observers are wondering if Adams will be the first.
In the meantime, Lander is risking a second term as comptroller to enter what will be a very difficult, if winnable, primary against Adams. Adams may accuse Lander, who is white, of racism for trying to run against the city’s second Black mayor. Adams has a base with outer-borough working class Black and Latino voters that Lander, who owns a brownstone in Park Slope, will struggle to court. Lander is a proud progressive and proponent of police reform, which might make it harder for him to appeal to New Yorkers worried about public safety, which has been a factor for conservative Asian voters in recent elections.
Lander is Jewish, but he is unlikely to secure support from too many Orthodox Jews because he is a liberal Zionist and critic of the Netanyahu government. He has also associated with anti-Zionists who are reviled in the Orthodox community.
But Lander can triumph if he manages to win over enough of the voters who supported Maya Wiley and Kathyrn Garica in 2021. Garcia came within 10,000 votes of beating Adams, and Lander should be able to win over many of the voters in Park Slope, Gowanus and Brooklyn Heights who supported her. Many white liberals and moderates in Manhattan also backed Garcia, and Lander will be competing with Stringer, who once served as Manhattan borough president, for those voters. Lander has a chance to win Manhattan, as he did in his 2021 comptroller’s race.
The progressive and socialist vote should be Lander’s for the taking. Northern Brooklyn and western Queens, where democratic socialism is popular and many young, college-educated leftists reside, have become high-turnout areas in Democratic primaries. Adams is deeply unpopular in those neighborhoods, and Lander’s pro-tenant, big government liberalism will be an easy sale there. Alexandria Ocasio-Cortez might endorse him.
New York’s powerful real estate and finance communities could be an obstacle to Lander if they seed super PACs to oppose him. Lander, so far, has chosen to ground his campaign in his governing experience and technocratic bona fides rather than overt ideology, but it’s possible developers and financiers could be wary of a Democrat who might govern to the left of de Blasio. If they are, and super PACs run anti-Lander ads, his campaign could suffer.
The ranked-choice voting primary may not be kind to Adams. RCV rewards coalition-building and punishes polarizing candidates. Lander and other challengers could choose to cross-endorse each other to stop Adams. With voters allowed to choose up to five candidates, they can rank a number of anti-Adams Democrats, guarding against the possibility of vote-splitting.
Adams does have a chance to survive. He still has a large campaign war chest and support in the outer boroughs. Lander, Stringer and Myrie aren’t guaranteed to deny him a second term. If Cuomo enters the race, the calculus could be scrambled further.
The only promise, for 2025, is that it won’t be a boring year for politics.
Ross Barkan is a journalist and author in New York City.
Laura Sigman and Diane Laura, marketing executives at a financial services company in Midtown, have often found their office chitchat this summer turning to the subject of their hellish commutes.
As scorching weather helped trigger power disruptions that touched off massive delays in rail service last month, it took Sigman three hours by subway, bus and Uber to get from work to her home in Asbury Park, New Jersey — a journey that would typically take a fraction of the time if New Jersey Transit trains were running as normal. Laura spent hours sweating on stifling subway platforms and walking to alternate stations to reach Prospect Heights, usually about 40 minutes away.
Their commuting woes weren’t a one-time inconvenience. Recurring transit meltdowns have plagued Manhattan-area travelers this summer, pointing to a bleak conclusion: Greater New York City’s wires weren’t built to withstand extreme heat.
“New York City infrastructure is one of the oldest in the U.S.,” and power lines and other equipment can be vulnerable to heat because they’re nearing the end of their lifespan, said Mona Hemmati, a civil engineer and postdoctoral research scientist at Columbia University’s climate school. “We need to think about more frequent inspection and adopting monitoring efforts to prevent accidents and ways to make them more resilient to rising temperatures.”
Hemmati knows about the city’s aging wires and train equipment firsthand: She almost passed out in July when the air conditioning in her subway car stopped working. AC failures have happened repeatedly this summer in the subways and on commuter rail, with a power loss trapping NJ Transit passengers in a tunnel under the Hudson River for hours last week. The cause of the outage is being investigated.
The transit snags in the New York metropolitan area — the biggest U.S. transportation hub — are a microcosm of the risks cities around the world face as record temperatures strain power grids built for a 20th-century climate. Shielding electrical systems against blistering conditions will require multibillion-dollar investments, money that many governments don’t have or can’t spend without political consensus. As global warming intensifies, it will bring crucial infrastructure to the brink of collapse and beyond.
NJ Transit and Amtrak have sometimes given conflicting accounts of what caused this summer’s delays. In at least once instance, NJ Transit blamed “Amtrak overhead wires,” while Amtrak countered that the train’s equipment was faulty.
Trains running under the Hudson River from New Jersey to New York have to pass through a single tunnel connecting the two states, creating a chokepoint. Like other parts of Amtrak’s Northeast Corridor from Boston to Washington, the North River Tunnel, which handles roughly 200,000 passenger trips each day, relies on a network of overhead power lines.
Some wires in the Northeast Corridor were installed as far back as the 1930s and 1940s. In hot weather, they can sag and get pulled down by passing trains, knocking out electricity and creating the stuff of transit nightmares.
In June, government-controlled Amtrak received final approval for federal funding toward a $16 billion plan that will involve building a new Hudson River tunnel and rehabilitating the existing one. But the work isn’t scheduled to be complete until 2038.
Searing conditions can cause problems outside the North River Tunnel, too. High temperatures can affect bridges, diesel engines and climate-control systems, sometimes prompting Amtrak and other railroads to operate trains at lower speeds. Heat can also snarl road traffic: Last month, the Third Avenue Bridge, which connects the Bronx to Manhattan, got stuck in an open position for hours on a particularly hot day.
Climate risks
Amtrak is “actively identifying and prioritizing climate change risks — to see where they are changing most rapidly across our network — and defining steps to manage the impact,” an Amtrak representative said in an email. The company said there remains a “significant need to fund track and other basic infrastructure due to decades of underinvestment.”
NJ Transit, which uses Amtrak’s North River Tunnel to shuttle passengers to and from Penn Station, said in an emailed response to questions that about 40 commuter trains were canceled or combined over a few days in mid-July. Amtrak says heat could have contributed to its disruptions but was not the primary cause. Public Service Electric & Gas, which provides power to NJ Transit, declined to comment. In late June, Amtrak and NJ Transit officials pledged to work together to investigate and resolve the infrastructure failures.
But their promises come as the largest transit agencies across the Northeast scrounge for extra cash. NJ Transit rolled out steep fare hikes in July after sounding alarms on its $107 million deficit. Gov. Kathy Hochul’s pause on a congestion pricing plan left the Metropolitan Transportation Authority — which oversees New York City’s subways, the Long Island Rail Road and Metro-North Railroad — without a crucial funding source, prompting the system to defer $16.5 billion of much-needed infrastructure upgrades.
And the subways haven’t been immune to snags this summer. As temperatures rose into the high 90s F last month, power outages from a malfunctioning transformer resulted in delays on several lines. While the MTA says the problem wasn’t heat-related, it nonetheless left commuters to languish on scalding platforms. Aging trains, meanwhile, have left some cars without air conditioning.
Although the system dodged any heat-driven power outages this summer, the MTA is “definitely bracing” for any issues as the globe continues to warm, Jamie Torres-Springer, the MTA’s president of construction and development, said in an interview.
Power is sent to the trains through either the third rail or overhead wires. In between those are the substations, which convert the electricity into different voltages.
“Those substations are vulnerable to high heat conditions,” he said, noting that about 570 of the substation components in the MTA system are on average 50 years old. “If they overheat, then the substation stops working and you get power outages.”
Baking wires
Con Edison, which runs the city’s main power grid, said its 95,000 miles of underground wiring have made the utility 10 times more reliable versus the nationwide average. But in sizzling weather, the buried cables bake under layers of asphalt, making them vulnerable to localized failures, Patrick McHugh, Con Edison’s senior vice president of electric operations, said in an interview. Overhead wires may be less likely to overheat, he said.
The utility is spending $2.3 billion to shore up its grid against the heat and to transition to clean energy. It’s replaced almost all of the 50-year-old paper-insulated lead covered cables from its backbone system and is working to do the same for the secondary system that feeds homes and streetlights.
But outages still happen, like the one that affected customers in Harlem in mid-July. Kaisha Huguley, an actor who lives in East Harlem, had to take the stairs to her eighth- floor apartment during one power failure after the elevator stopped working, she said in an interview. She filmed her weary climb on TikTok and people responded to her with similar stories.
“It was irritating,” said Huguley. “But I worry for people who actually don’t have the ability to move and need an elevator, like if someone were to be disabled or had broken their ankle.”
For some residents of New York City and surrounding areas, the heat-driven disruptions have been severe enough to prompt them to consider moving. Sigman, the marketing executive, is throwing in the towel and moving to Hoboken — in large part to avoid NJ Transit, which she said is unreliable year-round.
“The overall commuter experience becomes worse in the heat,” she said. “But the infrastructure issues were always there and the heat is making a convenient storyline.”
Leases
StubHub subleases space from Spotify at 4WTC
Address: 4 World Trade Center, Manhattan
Landlord: Silverstein Properties
Sublandlord: Spotify
Subtenant: StubHub
Lease size: Approx. 100,000 square feet
Asset type: Office
Brokers: Savills' Scott Bogetti, Kirill Azovtsev, Michael Bertini, Brad Wolk and Will Joumas represented the subtenant. Colliers' Sheena Gohil represented the sublandlord.
Tech company leases space by Times Square
Address: 498 Seventh Ave., Manhattan
Landlord: George Comfort & Sons., Loeb Partners Realty and JR AMC
Tenant: PubMatic
Lease size: 60,000 square feet
Asset type: Office
Brokers: Savills' Greg Taubin represented the tenant. George Comfort & Sons' Matt Coudert and Andrew Conrad represented the landlord.
Headware, travel accessories firm inks Midtown South lease
Address: 10 W. 33rd St., Manhattan
Landlord: Adams & Co.
Tenant: Supply Accessories
Lease size: 7,686 square feet
Asking rent: $42 per square foot
Asset type: Office
Brokers: David Levy represented the landlord in-house.
Sales
Wavecrest Management picks up pair of Harlem rentals
Addresses: 111 and 148 W. 141st St., Manhattan
Sellers: Community League of the Heights and Monadnock Development
Buyer: Joseph Camerata
Sale price: $26.3 million
Asset type: Multifamily
Six-story prewar Astoria apartment building trades
Address: 32-85 33rd St., Queens
Seller: Miller & Miller Real Estate
Buyer: Bell Realty Management
Sale price: $8 million
Asset type: Multifamily
The entity that oversees the 85-acre Brooklyn Bridge Park is looking for a new tenant to operate out of its historic fireboat house at Pier 1, according to the city register.
Built in 1926 at Fulton Ferry Landing, the 2-story, shingled building on the edge of the East River has long been retrofitted into an ice cream shop. For nearly two decades, Brooklyn Ice Cream Factory served its homemade frozen treats out of the concession before it was removed in 2018 to make way for the then-up-and-coming Ample Hills Creamery, which was founded in the borough in 2010.
Several years after that, Ample Hills was replaced by national competitor Van Leeuwen, whose license to operate out of the fireboat house expires at the end of this year, according to park stewards, who are now soliciting bids via what's called a request for proposals for the next food and beverage concessionaire.
Both Ample Hills and Van Leeuwen — which started in the city in 2008 and has since grown to include partnerships with celebrities, such as singer Sabrina Carpenter — are welcome to apply again as the solicitation is "standard practice," said Eliza Perkins, a spokeswoman for the park. Neither Ample Hills nor Van Leeuwen, however, responded to a request for comment by press time.
According to figures from Brooklyn Bridge Park, Van Leeuwen raked in nearly double the cash that Ample Hills did during similar time periods. Between June and August of 2022, Ample Hills' average monthly gross revenue was $124,044, while during the same three months in 2023, Van Leeuwen took home $251,521 each month on average.
The current license agreement between the waterfront greenspace and Van Leeuwen, according to Perkins, was $75,000 for its first year, rising to $100,000 for the second year, or 10% of gross receipts, whichever was higher.
Vendors looking to set up shop on Pier 1, where the neighborhoods of Dumbo, Brooklyn Heights and Downtown Brooklyn all meet, must submit a proposal by Sept. 3 that states the highest amount they would be willing to pay for a two-year license, according to the RFP.
Years before Van Leeuwen moved in, the ouster of the Brooklyn Ice Cream Factory caused an uproar in the community. Owners Mark Thompson and Buzzy O'Keefe, who also owns the famed River Cafe next door, told Brooklyn Paper at the time that they were getting the boot from their longtime digs because they hadn't submitted a high-enough bid.
Forget the Hamptons, Nantucket or Capri — Wall Street is spending part of the summer at the Paris Olympics.
“It’s a bit like Davos with some Olympics events in between,” said Mary Erdoes, who leads JPMorgan Chase’s asset- and wealth-management business.
Erdoes described non-stop client meetings and unplanned run-ins with business leaders in sporting arenas. Erdoes’ self-professed favorite event is gymnastics, in part because her daughter is a University of California, Los Angeles, athlete, but she has watched archery and swimming.
Also on the ground is Morgan Stanley co-president Dan Simkowitz, who became a “sport ambassador” for USA Swimming through a donation to the U.S. Olympic & Paralympic Foundation. Simkowitz, who was the co-captain of Harvard’s swim team in 1987, rooted for Katherine Berkoff, the daughter of his college teammate who secured bronze in the women’s 100-meter backstroke.
Simkowitz, who said the Olympics “emphasizes the value of physical fitness and mental health” is on the board of the USOPF, which aims to raise $500 million by Los Angeles 2028 to be able to better provide for its athletes, 57% of whom earn $50,000 or less per year, according to Christine Walshe, the group’s president.
Citadel’s Ken Griffin has contributed more than $10 million to the USOPF since 2020, a level that grants him the designation of team captain in Paris.
Griffin, who said that the Games are a “special opportunity to come together as a country,” is hosting a company outing on Friday to the Stade de France to watch track and field, along with Citadel Securities Chief Executive Peng Zhao.
Walshe said the nonprofit has begun talks to raise a separate $200 million so that by 2028, medalists can take home a multiple of the $37,500, $22,500 and $15,000 they’ll earn for gold, silver and bronze, respectively, from the U.S. Olympic and Paralympic Committee in Paris. Extra funding will also drive the ability to pay a $10,000 grant upon qualifying for Team USA and a $100,000 payment upon retirement to anchor future savings.
The USOPF recently received a record $25 million gift from venture capitalist and Nvidia board member Mark Stevens.
For most countries, athlete funding comes from a mixture of government, sponsorship and personal sources. In the U.S., athletes get no support from the state — instead they’re funded by philanthropy, endorsements and a slice of broadcast revenue.
“I’ve always been surprised that we’re the only major country that doesn’t have any government support for Olympians,” said USOPF Chairman Geoff Yang, also of Redpoint Ventures, who has tickets to table tennis, boxing, beach volleyball and more. “At a time when our country is so polarized, Team USA can play a very important role in uniting people of different political views, faith and races.”
Yang has recruited venture capital peers to donate time and money including Raine Ventures’ Gordon Rubenstein, who is on the USOPF’s trustee list alongside Silver Lake’s Karen King, Starwood’s Barry Sternlicht, Apple’s Eddy Cue and Apollo Global Management’s Martin Kelly, who attended swimming and fencing, among other events.
Rubenstein, a pin-trading enthusiast who began collecting the mementos at the 1984 Los Angeles Olympics, said he believes the most compelling moments are not always at the biggest events.
“Sports that are not as visible often feature inspirational athletes that sacrifice a lot financially and in their personal lives,” he said.
Blackstone's Stephen Schwarzman, who has over the past 11 years donated about $30 million to the USATF Foundation, was spotted at a gymnastics event. His colleague David Blitzer plans to watch basketball, as does his Philadelphia 76ers co-owner Josh Harris, co-founder of Apollo and 26North Partners, and lead owner of the Washington Comanders.
Galaxy Digital’s Mike Novogratz, who helps fund USA Wrestling medal stipends, will be at the Champ-de-Mars Arena to watch the action unfold. The former college wrestler said he gives “energy and love to a sport that doesn’t get a lot of it.”
Perhaps visiting more venues than anyone is Gene Sykes, Goldman Sachs Group’s co-chair of mergers and acquisitions, who was last week named as a member of the International Olympic Committee for an eight-year stint. He’s juggling an official duty: presenting medals.
In addition to financiers, Delta Air Lines’s Ed Bastian has watched swimming at La Defense Arena, as has European Central Bank President Christine Lagarde, Australian mining magnate Gina Rinehart and New York Islanders co-owner Jon Ledecky — uncle of decorated swimmer Katie Ledecky.
Elsewhere, Bill Gates and Warner Bros Discovery’s David Zaslav took in events including artistic gymnastics and tennis while Comcast's Brian Roberts rubbed shoulders with French tycoon Bernard Arnault at an event co-hosted by Serena Williams, Charlize Theron and others on the eve of the opening ceremony.
Earlier that day, Arnault, Schwarzman, Elon Musk, Goldman’s David Solomon, Coca-Cola’s James Quincey and Alibaba Group Holding’s Joe Tsai had lunch with French President Emmanuel Macron.
It’s unclear how many Wall Street staff below the C-suite level made it to the Games. Goldman Sachs told its employees in April that any trips to the French capital city between July 24 and Aug. 14 must first get approval from the firm’s finance department.
Here are the subway disruptions, road closures and other commuting changes you should be aware of as you get around the city this week.
Subways * Trains on the 3 line are suspended between Monday, Aug. 5 and Friday, Aug. 9 overnight from 9:30 p.m. to 5 a.m. * Service on 5 trains ends at 8:15 p.m. between Bowling Green in Manhattan and East 180th Street in the Bronx between Monday, Aug. 5 and Thursday, Aug. 8. * No G trains between Bedford-Nostrave Avenues in Brooklyn and Court Square in Queens until Aug. 11. * No 2 trains between 3rd Avenue-149th Street in the Bronx and 135th Street in Manhattan between Monday, Aug. 5 and Friday, Aug. 9 overnight from 9:30 p.m. to 5 a.m. * No N trains at Coney Island-Stillwell Avenue in Brooklyn on Tuesday, Aug. 6 between 9:45 a.m. to 3 p.m. * No D trains in Brooklyn at Coney Island-Stillwell Avenue on Thursday, Aug. 8 between 9:45 a.m. to 3 p.m. * 2 trains operate every 16 minutes between East 180th Street and Wakefield-241st Street in the Bronx between Thursday, Aug. 8 and Friday, Aug. 9 from 10:30 a.m. to 2:30 p.m. * In Brooklyn, no L trains between Myrtle-Wyckoff Avenues and Atlantic Avenue on Thursday, Aug. 8 from 10 a.m. to 2:30 p.m.
Commuter rail * Eastbound Long Island Rail Road trains skip Hollis and Queens Village stations, Monday through Thursday from 9:45 a.m. through 3:00 p.m. through Aug. 29. MTA buses will accept LIRR tickets for travel from Jamaica to Hollis and Queens Village.
Roads and bridges
The following streets will be closed for the Rise Up NYC—Wingate Park Concert in Brooklyn on Thursday, Aug. 8 and Friday, Aug. 9th:
- Rutland Road between New York Avenue- Kingston Avenue
- New York Avenue between Rutland Road-Winthrop Street
- Winthrop Street between New York Avenue-Kingston Avenue
- Kingston Avenue between Winthrop Street- Rutland Road
- Fenimore Street between New York Avenue-Brooklyn Avenue
- Hawthorne Street between New York Avenue-Brooklyn Avenue
- Brooklyn Avenue between Rutland Road-Winthrop Street
Read recent transportation stories:
A luxury developer drawn to vacant houses of worship has set its sights on a shuttered church in Brooklyn’s Greenwood Heights neighborhood.
Watermark Capital Group seeks to redevelop the former campus of St. Rocco’s Roman Catholic church into a three-building, 257-unit mixed-use complex, according to documents filed with the Department of City Planning on Thursday.
But the site, at 783 Fourth Ave., is currently designated for manufacturing uses, which means the developer would need the large, L-shaped parcel to be rezoned for residences by way of a public universal land-use review process before moving forward.
Though the church has not offered regular masses since merging with nearby St. John the Evangelist in 2011, the five-building site is technically still owned by the Archdiocese of Brooklyn, according to property records, though Watermark appears to control it through a lease, the Planning documents show.
Under the plan, Watermark, a Brooklyn-based firm founded in 2006 by Wolfe Landau and David Tabak, would raze all the buildings at the site, which include an A-frame-style church and a yellow-brick youth center, and replace them with a three-towered complex surrounding a courtyard.
The tallest building, which would rise at Fourth and 27th streets, would stand 13 stories. In addition, a 7-story building would face 27th, and an 8-story version would be on 28th Street, for a total of 176,000 square feet, the plans show.
Of the 257 apartments, 64 would be set aside as affordable units, in line with mandatory inclusionary housing requirements, and be made available to those making an average of 60% of the area median income, which translates to about $76,000 a year for a family of three, according to the filings. The project would also offer 10,000 square feet of commercial space along Fourth Avenue.
Watermark is also seeking to waive a parking rule for new developments that could require 97 spaces; it seeks to construct 10 instead. No development cost was provided.
In arguing its case for a change of use for the property, Watermark says that it’s hoping to bring St. Rocco’s site in line with the rest of the neighborhood, which has been green-lighted for added residential development through a series of zoning changes since 2005. The church site, which hugs a busy, low-slung street, was excluded from those previous changes.
Named for a 14th-century Frenchman who was later venerated as a protector against contagious diseases, St. Rocco’s was founded in 1902 as a parish for Italian immigrants, some of whom seem to have been stone carvers in nearby Green-Wood Cemetery. After the parish merged with St. John’s at 21st Street in 2011, the Archdiocese in 2019 decreed that St. Rocco’s former home on Fourth Avenue would no longer be used for worship.
Watermark, meanwhile, in June snapped up a dilapidated former Methodist church at 144 St. Felix St. in Fort Greene for $15 million and in November purchased the St. Lucy’s-St. Patrick’s parish at 285 and 295 Willoughby Ave. in Bedford-Stuyvesant for $12.3 million, according to the city register.
A phone message left with Shulem Kessler, the Watermark executive named in the Planning documents, was not returned. Coleen Ceriello, the Archdiocese official in charge of St. Rocco’s redevelopment, also did not return a call. And Eric Palatnik, the lawyer handling the rezoning bid, declined to comment.
The Brooklyn-based property investment firm that drew attention earlier this year when it took over popular East Village dive bar Lucy's has made another big move in the same neighborhood — this time acquiring the Second Avenue building that's long been home to kosher diner staple B&H Dairy Restaurant, city records show.
Ryco Capital, which is headquartered in Gowanus, bought the property at 127 Second Ave. as part of a massive purchase totaling $132 million for nine buildings within a several-block span, including multiple walk-up apartments and ground-floor restaurants, such as the circa-1940s lunch counter that serves up Jewish dairy fare.
Under different variations of a limited liability company called West Lake, Ryco scooped up B&H Dairy, along with two buildings next door, between Seventh Street and St. Marks Place, for $29 million from Long Island-based real estate firm Jonis Realty Leasing, according to a deed that appeared in city records Thursday, and which was first reported by the Commercial Observer.
The fate of the old-school kosher diner is uncertain. A manager who answered the phone Friday morning and declined to give her name said she had just learned of the building's sale and has yet to meet the new landlords.
Ed Robertson, the director of asset management at Ryco, did not respond to a request for comment about Ryco's plans for B&H by press time.
The Brooklyn firm also scooped up six additional Second Avenue buildings — 141, 145, 149, 151, 156 and 157 — between Eighth and 10th streets, for $103 million from the same Long Island company, whose president is Joshua Halegua, records show. Halegua did not immediately respond to a request for comment about why his firm has offloaded nine buildings on the same block, nor did Robertson return a request for comment on why the company bought all nine buildings and its plans for them.
Meanwhile, Robertson told Crain's in June that his team plans to reopen Lucy's — the now-shuttered Avenue A watering hole that's less than a 10-minute walk from the firm's recent acquisitions — in the fall under new management.
New York state is backing the Adams administration’s court battle in defense of a contentious city law aimed at slashing carbon emissions from buildings — a move that boosts the city’s case by severely undermining the central argument in the suit.
A coalition of co-op and building owners sued to overturn Local Law 97, which would impose significant fines on properties larger than 25,000 square feet that don’t meet emissions goals in 2025. A surprise appeals court ruling in May allowed the coalition to argue that Local Law 97 should be blocked because it is superseded by state law. In July court papers, however, the office of state Attorney General Letitia James flatly rejected the claim that the mandates of the city law are effectively overruled by a 2019 state climate law.
“That intent [of state climate law] was not to preempt, but rather to embrace local greenhouse gas reduction efforts like Local Law 97,” wrote Jennifer Simon, an assistant New York attorney general in the office’s environmental protection bureau, in court papers obtained by Crain’s.
“If implementation of Local Law 97 were blocked,” Simon added, “the state would lose a vital tool in reaching its emissions reduction mandates — with potentially devastating consequences for the economy, public health, and environment of the state.”
The attorney general’s office’s move to clarify state law and defend Local Law 97 is a win for the Adams administration and proponents of the building climate measure. It also indicates that state officials believe the lawsuit could open the door for others to challenge local measures to reduce planet-warming emissions. Indeed, Simon said plainly in court papers that the “highly problematic” argument puts the state, the city and the real estate industry “in limbo with costly consequences.”
“So long as a cloud hangs over local initiatives like Local Law 97, no stakeholders will have the certainty required for effective planning,” wrote Simon. “Industry players will not know with what regulatory standards they will be expected to comply. They may therefore delay their own investments in emissions reductions or be forced into expensive course corrections.”
A panel of state Supreme Court judges ruled Thursday that the city can advance its fight against the lawsuit; the judges cited the state’s support as key in their decision.
Local Law 97, which took effect at the start of the year, was designed to reduce the city’s planet-warming emissions from buildings — the city’s largest source of such emissions — with escalating carbon caps. Owners who skirt the law could face fines of $268 per ton of emissions over the limit — a penalty that for some properties could stack up to six figures or more annually.
Reports from landlords showing that their buildings are in compliance with the law are due starting in May 2025.
Nicholas Paolucci, a spokesman for the city's Law Department, said the city welcomes the state’s support in court.
Leases
Infrastructure, consulting firm joint venture leases in Long Island City
Address: 21-01 51st Ave., Queens
Landlords: Kaufman Organization and True North
Tenant: STV-NAIK Engineering
Lease size: 10,300 square feet
Asking rent: $42 per square foot
Asset type: Office
Brokers: Kaufman Organization’s Grant Greenspan represented the landlords. CBRE’s Scott Henley, Jared Issacson and Taylor Walker represented the tenant.
Investment firm inks Columbus Circle lease
Address: 3 Columbus Circle, Manhattan
Landlord: The Moinian Group
Tenant: Night Squared
Lease size: 3,874 square feet
Lease length: Five years
Asset type: Office
Brokers: Spaces Commercial Real Estate’s Lance Leighton represented the tenant. CBRE represented the landlord.
Sales
Ryco Capital continues acquisition of prewar East Village rental buildings
Addresses: 127, 129, 131, 141, 145, 149, 151, 156 and 157 Second Ave., Manhattan
Seller: Halegua family
Buyer: James Ryan
Sale price: $132 million
Asset type: Mixed use
Homeless services provider snaps up Inwood site
Address: 3816 Ninth Ave., Manhattan
Seller: Manhattan Bible Church
Buyer: The Bridge, Inc.
Sale price: $15.8 million
Asset type: Religious
Financings
Williamsburg 270-unit Lorimer House project snags bridge financing
Address: 28 Boerum St., Brooklyn
Owners: The Loketch Group, The Joyland Group and Meral Property Group
Lender: TPG Real Estate Credit
Loan amount: $173 million
Asset type: Mixed use
Coworking firm Jay Suites has purchased a Bryant Park office building for $35 million, sources familiar with the deal have confirmed.
The property at 8 W. 38th St., located between Fifth and Sixth avenues, across from the former Lord & Taylor building, had been owned by William Felder's Fraglow Realty since at least 2001, city records show. The 12-story building was constructed in 1913 and spans about 142,000 square feet, according to commercial real estate database CoStar.
ABS Partners Real Estate's Randy Modell and Steven Hornstock represented Fraglow in the deal, and Newmark's Ron Solarz represented Jay Suites. Ian Weiss and Andrew Udis of ABS served as the leasing agents at the building for several years.
Jay Suites was founded in 2008 and will occupy the sole vacant floor of 8 W. 38th St., which is 80% leased, according to ABS. It will not convert the entire property into a flexible office space location, so the existing tenants—which include Irish pub Blaggard's and nonprofit real estate firm The Community Builders, according to CoStar—should be able to keep their locations.
Jay Suites has nine Manhattan locations, not including its recent purchase: one in Chelsea, two downtown and seven in Midtown. Its Midtown locations include 15 W. 38th St., right across the street from its new property.
The building at 8 W. 38th St. was initially built as a department store for Jacob Astor's sister, and its large windows and high ceilings reflect this, Solarz noted.
Although the struggles of well-known companies like WeWork and Knotel have largely defined the flexible office space market in recent years, coworking firms that have kept a lower profile have continued to quietly expand. Industrious took over WeWork's former Midtown headquarters earlier this year, for instance, and Framework is expanding to a second location in Two Trees' Domino Refinery project in Williamsburg.
ABS is both a broker and a property owner. The firm owns and manages about 3 million square feet of property in New York, Modell said.
Its portfolio includes the multifamily building at 2560 Broadway on the Upper West Side, which it plans to demolish, and 200 Park Ave. South by Union Square. The firm also helped broker last year's sale of 6 E. 45th St., which Garment District-based investment firm Sioni Group bought for about $27 million.
Randy Mastro has been mostly muzzled in the three months since it emerged that Mayor Eric Adams wanted to make him the city’s top lawyer. Some City Council members openly railed against Mastro’s controversial client history and pledged to vote him down.
But after being formally nominated as corporation counsel on Tuesday, Mastro is now free — and eager — to give his side. In an interview with Crain’s on Thursday, Mastro defended his record, explained his vision for a more aggressive city Law Department, and described his readiness to sue a future Trump administration.
Mastro is scheduled to get a City Council hearing and vote within the next month, and the mayor’s office is working to shore up support by leaning on outside validators who speak warmly of his work.
Approached by Adams
Mastro said he was approached by the mayor’s team “earlier this year” about returning to city government as corporation counsel. Word was leaked in April — “to my dismay,” Mastro said — that he was under consideration, although outgoing corporation counsel Sylvia Hinds-Radix did not step down until May 31. (City Hall has denied a report that Hinds-Radix left due to disagreements with the administration over whether city lawyers should represent embattled Adams aide Tim Pearson.)
“I’ve known the mayor going back to the mid-‘90s when he was the head of something called 100 Black Men in Law Enforcement,” Mastro said. At the time, Mastro was serving in Rudy Giuliani’s administration; he is currently a partner at King & Spalding.
“I admired the way he conducted himself, that he spoke truth to power. I always had an open door at City Hall, so we had a mutual respect for each other at that time, we followed each other's careers,” Mastro said.
He said he kept tabs on Adams as he ascended to public office, while the future mayor took note of Mastro’s pro bono work to halt a planned expansion of the Brooklyn House of Detention. (Mastro later donated a total of about $4,000 to Adams’ 2021 campaign and 2025 re-election bid.)
Mastro was “honored and flattered” by the invitation to become corporation counsel. “It's actually the one position in city government to which I always aspired, because I love practicing law,” he said.
‘Nada’ on FBI
Has Mastro had any discussions with Mayor Adams about the federal investigation into his campaign’s fundraising and possible dealings with Turkey, or the other reported probes into administration officials?
“None, zero, squat, nada,” Mastro said. “Corp counsel doesn’t represent the mayor in connection with the federal investigation that you alluded to.”
Contested clients
Progressives on the City Council have already found plenty of fault with Mastro’s private-practice clients. The most notable among them include Chevron in a pollution case in Ecuador, Manhattan residents fighting homeless shelters, and Madison Square Garden in its defense of a policy barring rival attorneys from public events.
“I admit that I’ve taken on clients in high-profile matters, sometimes controversial, representing my firm’s clients. That’s what lawyers in private practice in major firms do. They zealously and ethically represent their firm’s clients and get the best possible results for them,” he said. “I admit I’ve been very successful as a litigator. That should be a plus.”
But the real indicators of Mastro’s personal views, he says, are his pro bono clients: the Legal Aid Society defending a discrimination suit brought by a white staff attorney, Black Lives Matter protesters who sued President Donald Trump over their 2020 dispersal near the White House, a Black Long Island teacher who was fired after giving an assignment on racism.
“When people get to know my record, I think they will understand what I bring to the table,” he said, “and that's success in litigation and values that embody protecting and promoting civil rights, constitutional rights, social justice and public safety.”
‘No apologies’ for hiring investigators in Lucerne case
One issue likely to arise during Mastro’s confirmation hearing is a 2021 incident in which he sent private investigators to secretly photograph a formerly homeless man who had been a vocal advocate for the men living temporarily at the Lucerne Hotel on the Upper West Side. Mastro was representing neighborhood residents opposed to the hotel shelter.
Advocates for the homeless condemned the tactic, and the city’s Homeless Services department called it an “egregious invasion” of privacy. Shams DeBaron, the man who was photographed, has since become a vocal supporter of Mayor Adams on housing issues and frequently appears by his side at public events.
Mastro says he makes “no apologies” for the tactic or his work on that case, which he said was focused on relocating the men to a different facility where they would have better access to social services. DeBaron was among a group of men suing to stay at the Lucerne, but Mastro was trying to prove he had moved into permanent housing and therefore had no standing to sue.
“I had to prove that he had moved out of Lucerne. That's something a lawyer has to do to prove one's case,” he said. “Standing in a public hallway of a building … was simply to prove that there was no longer standing for the lawsuit.” (DeBaron was photographed standing inside his apartment door.)
Mastro ultimately prevailed in the case, working alongside the de Blasio administration, which relocated the Lucerne residents to other shelters. Mastro noted that some of the Lucerne’s unhoused residents asked him to represent them pro bono because they wanted to move. Mastro’s Upper East Side townhouse was also vandalized in the midst of the saga.
“And at the end of the day, working with the de Blasio administration, we actually did something good for the men,” Mastro argued.
Ready to defend against Trump
Mastro’s vision for leading the 800-attorney Law Department involves filing more proactive lawsuits, something the department already does to some extent. As corporation counsel, Mastro says he would “use the law affirmatively to go after guns, to go after gang violence, to go after organized crime, to close illegal smoke shops.”
“We need to do more about gun violence and cracking down on illegal guns and also on the purveyors and suppliers of guns, looking for creative approaches to how to protect our city from gun violence when the Supreme Court won't protect us any longer,” he said.
Mastro also said his case against the Trump administration’s handling of Black Lives Matter protests would be an asset if, “God forbid,” Trump returns to the White House. (The Biden administration eventually reached a partial settlement with protesters and agreed to change policing policies.)
“If Donald Trump gets re-elected, there are huge ramifications for our local democracy and how New York City is treated in a Trump administration, and we’d better be ready to litigate,” he said.
Communication with the council
Mastro appears to face a tough road to confirmation, even as some council members have emerged “softened” from their meetings with him, one lawmaker said this week. Mastro said he plans to bridge the divide through “communication between both sides of the hall.”
“Something I specialized in when I was Deputy Mayor for Intergovernmental Relations,” he added, “[was] where I reached across the hall, worked so constructively with elected Democrats and unions that we got amazing things done working together.”
“I've met with many City Council members already, found them to be fair and open-minded,” Mastro said. “When they get to know my real record and the success I've had in pro bono work and community service … I think they're going to want that kind of success for the lawyers who represent them at the Law Department.”
The mortgage for a prominent Upper West Side shopping center that faced default early this year has emerged from the loan-workout room with a three-year extension, a striking turn of affairs that underscores the steadily rising fortunes for retailers who work where New Yorkers live.
Columbus Square, an outdoor mall and residential complex between West 97th and West 100th streets on both sides of Columbus Avenue, risked “imminent” default when its $367 million mortgage was sent to special servicing last year. The loan, originated by Wells Fargo and Barclays at a 4.5% interest rate, was scheduled to come due this month before it got extended until 2027, bond-rating firm KBRA said in a new report.
Banks agreed to the loan extension because Columbus Square, like other residential shopping areas across the city, is performing exceptionally well. The complex is more than 95% occupied, and stores that closed their doors after the pandemic hit have been replaced. Storefronts are now among New York’s most-wanted real estate, a big shift from a decade ago when Amazon seemed poised to wipe out the field.
Brooklyn retail space is selling at a near-record $642 per square foot this year, according to Cushman & Wakefield, and a Williamsburg block inhabited by Hermes and Nike was acquired by the Empire State Building’s owner for $2,545 per square foot. In the Bronx, retail space is selling this year at an average of $472 per square foot, also a near record.
“Lack of supply and growing demand provide a steadily upward bias for shopping centers, matched by few other sectors,” Piper Sandler analyst Alexander Goldfarb said in a client note today.
Kimco Realty, a Long Island-based owner of grocery-anchored shopping centers with 71 properties in the New York market, said this week that occupancy rose last quarter to 96.2% from 95.8% a year ago. Small-shop occupancy hit 91.7%, a record high for the company. Rents rose 12%.
“Retail may not be the highest [performer] in any year, but will be among the most stable,” Goldfarb said.
The exception to this stability is in Manhattan office buildings, where landlords are slashing rents by two-thirds or even more to discourage retailers from leaving. And Cushman & Wakefield data show real estate investors are still 10% less than in 2019 for retail space in Manhattan south of 96th Street, reflecting weakness in the office-centered neighborhoods of Midtown and the Financial District.
Happily for Columbus Square, it starts one block north of 96th Street and is located next to ParkWest Village Apartments and Central ParkWest Condominium, which have more than 3,200 units and 13,000 residents who provide steady foot traffic. Whole Foods has leased 120,000 of the outdoor mall’s 500,000 square feet through 2029. A Burlington store opened in 2022 to replace Michael’s, a Target replaced Modell’s Sporting Goods, and Five Below replaced Petco.
Columbus Square was developed in 2007 by Chetrit Group and Stellar Management at a cost of about $500 million on land acquired from Leona Helmsley. In 2012, its five apartment buildings were acquired by insurance giant MetLife and Colorado-based real estate investment firm UDR for $630 million. Two years later the developers pocketed $120 million in proceeds when they refinanced Columbus Square’s mortgage, KBRA said.
Chetrit and Stellar declined to comment.
San Francisco-based confectioner Ghirardelli Chocolate Co. will open a storefront at the base of the Empire State Building next week — the firm's first brick-and-mortar location in the city to sell its chocolate squares.
The Swiss-owned chocolatier, part of the Lindt & Sprüngli group, will debut locally Aug. 6 in 2,758 square feet of space on the ground floor of the landmarked, 102-story, West 34th Street building that was once the tallest in the world.
Ghirardelli, which started some 80 years before the Empire State Building came to define New York City's skyline, was founded in San Francisco in 1852 and is one of the country's longest-operating premium chocolate brands. The firm is run by chief executive Joel Burrows.
The new chocolate and ice cream shop at 16 W. 34th St. pays homage to its original Golden State location with a replica of the company's marquee sign on its facade, blue-and-gold tiling throughout the store, and a hot fudge kettle machine.
Ghirardelli joins more than a half-dozen food and beverage retailers already in the building, between Fifth and Sixth avenues, including Chipotle, Chopt, Tacombi and the new Starbucks Reserve. Neither the Empire State Realty Trust, which controls the building, nor Ghirardelli responded to requests for comment about the length of the chocolate company's lease or how much it is paying per square foot.
The space had previously been occupied by a Starbucks, according to Google Street View.
Fritz Kemerling of Manhattan-based firm Alvarez & Marsal represented Ghirardelli in the lease negotiations, and Matt Ogle, Corey Zolcinski and Patrick Smith of JLL represented the property owner with Fred Posniak in-house.
There are 30 retail spaces currently available for rent in the Empire State Building, according to its website, and the real estate firm's overall commercial portfolio is 92.6% leased as of last month, according to its most recent earnings report.
Built in 1932, the Empire State Building is now the fourth-tallest in the city, the sixth-tallest in the country and the 43rd-tallest tower in the world.
JetBlue Airways’s shares jumped the most in nearly four years as its new chief executive detailed plans to revamp the carrier’s operations and boost profits.
The airline plans to pull out of more cities and push out roughly $3 billion worth of new aircraft purchases until 2030 and beyond, JetBlue said Tuesday as it reported a surprise second-quarter profit.
JetBlue is pivoting to focus more on leisure customers in New York, New England, Florida and Puerto Rico, areas where it historically has had strong operations. That change, along with improvements in on-time performance and other areas such as enhanced loyalty perks, should produce between $800 million and $900 million in additional in pretax profit from 2025 through 2027, the carrier said in a statement.
JetBlue shares rose as much as 23% as of 12:02 p.m. in New York, the biggest intraday gain since November 2020. The stock had risen more than 6% this year through Monday’s close.
The moves are the latest in CEO Joanna Geraghty’s push to revive the carrier’s fortunes in the face of persistently high costs and diminished growth prospects following the breakup of multiple partnerships.
To cut costs, JetBlue will defer $3 billion in spending on new aircraft through 2029. The renegotiated delivery schedule with Airbus now calls for 44 A321neo aircraft to arrive in 2030 or later, expanding an earlier plan to push out spending on new planes.
The airline will also exit 15 cities as it refocuses its network, from which it has now cut more than 50 routes to trim unprofitable flying, the company said.
“As difficult as it is for us to make decisions for closing markets and closing routes, at the core our goal is to move to profitability as quickly as we can,” JetBlue President Marty St. George said during the company’s earnings call.
Geraghty, who took over for Robin Hayes early this year, has said her top priority is returning the carrier to consistent profits, which it hasn’t seen since 2019. She’s also facing pressure from activist investor Carl Icahn, who in February revealed a roughly 10% stake and began pushing to boost shareholder value. The company has since given his investment firm two board seats.
Second-quarter earnings were 8 cents a share, topping Wall Street expectations for a loss. At the same time, JetBlue forecast lower revenue and higher non-fuel unit costs than analysts were expecting this quarter and for the full year.
The company also said flying capacity should remain at 2024 levels through next year as more of its jets are parked to undergo lengthy engine repairs.
Aircraft in JetBlue’s fleet parked due to defects in geared turbofan jet engines made by RTX’s Pratt & Whitney unit should rise to the mid- to high-teens next year from roughly 11 today, Geraghty said, calling the situation “incredibly frustrating.”
JetBlue is facing the added challenge of growing without the benefit of acquisitions. Federal courts earlier struck down a regional alliance with American Airlines Group Inc. and blocked JetBlue’s planned $3.8 billion takeover of Spirit Airlines.
Mayor Eric Adams nominated the accomplished but controversial attorney Randy Mastro to be the city’s top lawyer on Tuesday, defying expected opposition from the City Council.
Mastro, currently a partner at King & Spalding, is a former federal prosecutor who held senior roles in Mayor Rudy Giuliani’s administration, including deputy mayor and chief of staff.
City Council members have signaled strong opposition to Mastro in the months since Adams began considering him for the job due to Mastro’s work for a Republican mayor and the controversial clients he has since represented — including Manhattan residents fighting homeless shelters, New Jersey Gov. Chris Christie’s office during the Bridgegate scandal, and oil company Chevron in a pollution case in Ecuador.
That opposition counts, since corporation counsel is one of just a few City Hall positions that must be confirmed through a City Council vote. The job calls for representing all of city government — including both the mayor and the City Council — and Adams needs to fill the vacant role after disagreements with the mayor’s team reportedly led to the resignation of the previous corporation counsel, Sylvia Hinds-Radix.
Although a majority of the 51-member council opposed Mastro’s nomination as of April, Adams is betting that City Hall’s persuasion tactics — which have included setting up one-on-one meetings between Mastro and lawmakers, and commissioning newspaper op-eds from Mastro’s admirers — will be enough to sway council members to his side.
“Randy is a world-renowned attorney who brings decades of experience as a public servant, federal prosecutor, preeminent trial lawyer, and as someone who has built a career around fighting corruption, delivering justice for 9/11 families and non-profit organizations, advocating for the LGBTQ+ community, championing racial justice, and standing up to the Trump administration,” Adams said in a statement on Tuesday.
Mastro, in a television interview on Tuesday, said he had met with a majority of council members since word emerged about his potential nomination in the spring.
“I believe that when they get to know me, they will like me, and they will like what I bring to the table,” he said, “which is success in litigation.”
One council member reached for comment Tuesday said meetings with Mastro had “softened a few members,” but added that his support in the body remains “mathematically very far away from a majority.”
“Most members would prefer the mayor picked someone more popular,” added the lawmaker, who was granted anonymity to describe internal sentiments.
City Council spokeswoman Julia Agos said in a statement that Mastro would get a hearing and vote within 30 days, adding that the person serving as corporation counsel must “have the faith of all city officials and the talented attorneys in the Law Department.”
Mastro, who has donated $2,100 to Adams' re-election campaign, is known for his aggressiveness as a lawyer — a quality that may have appealed to the mayor as he and the city face down a bevy of legal woes. Hinds-Radix departed amid disagreements with the mayor’s office over whether city lawyers should represent top Adams aide Timothy Pearson in a sexual harassment suit against him, Politico reported.
Adams’ aides have sought to reframe Mastro’s work in recent months, pointing especially to his pro bono clients — which have included Black Lives Matter protestors and politicians opposed to Michael Bloomberg’s effort to change term limits.
In the Giuliani administration, Mastro was known for his work to root out organized crime from the Fulton Fish Market and the private waste industry. His other clients in recent years have included fast-food franchisees seeking to block the state’s minimum-wage hike, landlords who challenged the state’s 2019 tenant protection laws, and New Jersey Gov. Phil Murphy in his state’s lawsuit against the now-stalled congestion pricing program.
Mastro, in a statement, said he was “humbled and honored” by his nomination. The mayor’s office made no mention of the tough road Mastro may face in the City Council, and the mayor had been mum about the possible nomination when speaking to reporters minutes earlier on Tuesday.
The City Council’s Black, Latino and Asian Caucus came out against Mastro in April, citing his “professional track record representing dubious clients.”
Lisa Zornberg, the mayor’s chief counsel, argued that Mastro was only doing his job by taking on controversial clients — likening his work to Founding Father John Adams’ representation of British soldiers accused of murder in the Boston Massacre.
“Randy’s an incredibly top-notch, world-renowned lawyer who’s given tremendous service already in the past,” Zornberg said
The legal challenges that now face the Adams administration include the federal investigation into whether Adams’ campaign conspired with the Turkish government, a lawsuit accusing the mayor of sexual assault in 1993, and multiple investigations into the conduct of his aides Timothy Pearson and Winnie Greco. The city is also trying to fend off a potential federal takeover of the Rikers Island jail complex as well as a tangle of legal issues surrounding the ongoing migrant crisis.
At the end of August, the Metropolitan Transportation Authority will sunset a fareless bus pilot that for a year has made a route in each borough free, with no plans to expand the effort into a full program, transit officials said Monday.
Beginning last September the MTA eliminated fares on five bus routes as part of an experiment mandated and funded by the state Legislature through a 2023 budget measure. But MTA officials said Monday that although the pilot increased ridership among existing users, the effort largely failed to attract new riders to mass transit, which would have justified its $12.3 million cost.
“There was a lot of fanfare on this pilot,” said Demetrius Crichlow, interim president of New York City Transit, at a Monday afternoon meeting on bus and subway service. “Our hope was that this pilot would get people out of their cars and onto buses on these routes … but we did not see anything that aligned with that initial intent.”
The fareless bus routes — the M116 in Manhattan, B60 in Brooklyn, Q4 in Queens, Bx18 in the Bronx and S46 on Staten Island — saw a roughly 30% bump in weekday traffic and a 38% jump in weekend travelers, according to Jon Kaufman, the MTA’s chief of strategic initiatives. In surveys conducted with riders, Kaufman said, the MTA found that only roughly 10% of the passengers were people who would otherwise drive or take a cab.
“I think different people had different ideas as to what success here would be like,” said Kaufman, alluding to state lawmakers, who’ve positioned fare-free buses as a way to promote equity for low-income New Yorkers rather than attract new passengers to mass transit. “If your goal is helping with affordability, there are smarter ways to do that than this.” Investing in outreach to beef up participation in systemwide efforts, such as the city’s half-price Fair Fares program, is one such way, said Kaufman.
Other transit officials, including Janno Lieber, the MTA’s board chair and chief executive , have said that the free-bus program sends mixed messages to riders and could inadvertently encourage travelers on paid bus lines to skip out on the fare during a time of alarmingly high, steadily growing fare evasion. In the first quarter of 2024, 47.8% of city bus riders did not pay the fare — that represents a 9.3% rise from the same time in 2023, a 15.4% increase from the first quarter of 2022 and a whopping 22.8% jump compared to same period in 2021, MTA data shows.
MTA board member David Jones, who runs the nonpartisan Community Service Society of New York, which promotes economic advancement for low-income New Yorkers, said it could be a challenge to get riders to return to paying the fare on the five routes now that the pilot is coming to an end. The MTA says it will post signage to warn riders of the change, and teams of MTA police will also circulate through the system to deter fare evasion.
“I’ve been worried about this,” said Jones, who wants the MTA to explore posting ticket-checkers on buses, similar to buses in London . “I think the shock to the system of people suddenly saying, ‘Oh, it’s over,’ and being then asked to pay, you’re going to have some difficulty.”
The party’s over at Alice’s Tea Cup.
The two-decades-plus-old, three-location restaurant known for its scones, sandwiches and baby showers has closed up shop in the face of more than $600,000 in unpaid bills, according to new court filings.
The Wonderland-inspired, Manhattan- and Brooklyn-based eatery, which was popular with locals, tourists and celebrities, will sell its assets to settle up with its creditors, according to the filings, which appeared Monday in Manhattan Supreme Court.
In recent years the restaurant’s co-owners, sisters Lauren and Haley Fox, had reportedly considered selling their 23-year-old eatery after it struggled to attract patrons in the pandemic.
But that effort to unload the business appears to have gone nowhere. And this month the Foxes handed the reins of the company to a lawyer known for corporate restructuring work to process its stack of bills, the filings show.
The hiring of the lawyer, Lawrence Morrison, was done through a legal maneuver called “assignment for the benefit of creditors,” a process similar to a bankruptcy protection proceeding but one considered far less expensive, time-consuming and public, though creditors can have less leverage in the liquidation process than with a bankruptcy case.
Founded in 2001 on the Upper West Side in a small, below-grade space at 102 W. 73rd St., a location known in-house as “Chapter 1,” Alice’s Tea Cup later added two other sites, at 156 E. 64th St. on the Upper East Side and at 43 Hicks St. in Brooklyn Heights, a takeout location. All three are now shuttered, according to the filings.
As the business grew, an early focus on beverages and cakes eventually gave way to a wider menu with more conventional dishes that sustained birthday parties, bridal showers and baby showers. Alice’s Tea Cup also attracted a Hollywood clientele. Conan O’Brien, Julia Roberts and Amy Schumer were all apparently fans of the restaurant group, which poured more than 100 kinds of tea, according to its menu.
But the restaurant’s compact and windowless spaces, which many considered charming in pre-Covid years, suddenly became a harder sell during the pandemic, the Foxes have said.
Among the list of entities to which Alice’s Tea Cup owes money is the federal Small Business Administration, which apparently lent the restaurant $500,000, court filings show; credit card companies are also in the mix.
Morrison did not return a call or email for comment. Attempts to reach the Foxes by press time were unsuccessful.
She's no longer Jenny from the East 26th Street block.
Superstar Jennifer Lopez has sold her NoMad penthouse for $23 million, according to a deed that appeared in the city register Monday — nearly seven years after it first hit the market for a couple of million more.
The Bronx native, who's made headlines recently for her apparent marriage troubles and supposed imminent split from actor Ben Affleck, is also parting ways with her luxe duplex in the four-unit boutique condo Whitman Mansion at 21 E. 26th St.
Lopez bought the 9,500-square-foot unit with views of Madison Square Park for $20.1 million in 2014 straight from the building's developer, David Mitchell, according to public records. She first listed the pad, which boasts four terraces and a private elevator, for $26.9 million in 2017 but couldn't seal a deal. The popstar, who often goes by the nickname J.Lo, tried again to sell it in 2018 and 2019 at the same sum before finally cutting about $2 million off the asking price last year.
Lopez sold the four-bedroom, seven-and-a-half-bathroom condo under a limited liability company named after the address, according to the July 24 deed, which was first reported by The Real Deal. Her attorney in the sale, Peter Graubard of Manhattan-based firm Graubard & Blumenfield, declined to comment on the transaction and if or where Lopez has plans to buy property elsewhere in the city. Lopez also reportedly owns real estate in Florida and California as well as an eight-bedroom mansion in the Hamptons that she purchased in 2013 for $10 million.
It's unclear who bought Lopez's unit. She sold the penthouse to a Miami-based trust, which lists Alex Bahamonde, chief fiduciary officer of the City National Bank of Florida, as its officer. Bahamonde did not immediately respond to a request for comment.
And Lopez isn't the only celebrity to have scored one of the few units in the 6-story, Georgian-style building between Madison and Fifth avenues, which was first erected in 1924 and converted into condominiums in 2013. Jeff Gordon, a longtime Nascar champion, owned a four-bedroom condo there until he sold it for $13.5 million last summer, and former first daughter Chelsea Clinton and her family have lived in the building since 2013, records show.
Broker Chris Pomeroy of Brown Harris Stevens, who represented Lopez in the sale and made the Hollywood Reporter's list of the top 30 New York real estate agents last month, did not respond to a request for comment.
Attention, New Yorkers: What if you could own a piece of a thriving downtown concert venue? What if it came with a 500,000 square-foot apartment tower in development and a piece of the Jean-George restaurant franchise, located in a historic fish-market building where the mob once ruled?
All that and more is available starting tomorrow, when the South Street Seaport is spun off from owner Howard Hughes Holdings and becomes part of a publicly traded company called Seaport Entertainment Group. Should you take advantage of this rare investment opportunity? In the end, it comes down to how you assess the impact of climate change.
South Street Seaport has been tantalizing investors ever since Mayor John Lindsay protected the historic neighborhood in the late 1960s. The district briefly was the city’s No. 1 tourist attraction in the mid-80s but the crowds moved on and the area was heavily damaged by Superstorm Sandy in 2012. In 2018 the Milstein family sold part of the area for $180 million to Howard Hughes Corp., which invested $1 billion in upgrades. Pier 17 was redeveloped into a popular 3,500-seat concert venue and the Tin Building, which was the Fulton Fish Market until a fire in 2005, is now a food hall presided over by chef and entrepreneur Jean-Georges Vongerichten.
“A lot of New Yorkers discovered the Seaport during the pandemic because it was an outdoor space where you could safely hang out,” said Alexander Goldfarb, a real estate analyst at Piper Sandler.
Yet the Seaport doesn’t make money, with net operating losses widening last year to $16 million from $10 million in 2022. Goldfarb attributed the loss to rising labor costs at restaurants. Howard Hughes didn’t reply to email messages; typically companies are quiet shortly before spinoffs or share offerings. Seaport Entertainment Group’s holdings will include a minor-league baseball team in Las Vegas and air rights belonging to a mall on the Strip.
In some ways the Seaport’s profit prospects look better than ever. Work has begun on the neighborhood’s great white whale, a nearly 550,000 square-foot mixed-use tower at 250 Water St. Neighbors fought the project for years on the grounds that a 27-story building would compromise the neighborhood’s historic character. But the Landmarks Preservation Commission contended there was nothing especially worth preserving about the site, which was a parking lot, and in May the state Court of Appeals affirmed that development could proceed.
Seaport will inherit $67 million in cash from Howard Hughes, enough to cover the $2.5 million annual rent to the city for the district’s land for several years but nowhere close to the funds needed to build an apartment tower. To fix that, Seaport plans to raise $175 million by selling shares to investors who might be impressed by the presence of uber-chatty hedge-fund manager Bill Ackman, who has a 38% stake in Howard Hughes, 1.3 million X followers and epithet written by a friend in a high school yearbook that reads, “A closed mouth gathers no foot.” Ackman, who recently downsized plans to sell an investment fund to the public, is expected to be a big Seaport stockholder after the spinoff, which takes effect Wednesday night, and the shares start trading the next day on the New York Stock Exchange.
In the end, success or failure at the Seaport will largely depend on the vagaries of climate. The Seaport’s $15 million loss last year was primarily due to “reduced restaurant performance as a result of poor weather conditions,” Howard Hughes said in its annual report. In its prospectus, Seaport said hospitality revenue fell 23% in the first quarter of this year due to poor weather “as evidenced by a 45% increase in total rainfall during the peak days of Friday through Sunday.”
You could chalk up the weather to bad luck. Or maybe it’s a sign of New York’s changing climate. National Weather Service data show more than 59 inches of rain fell in Central Park last year, 25% above the average year in the 1990s and 20% over the average year between 2000 and 2009.
Records show New York averaged 40 inches of rain a year in the 1960s and were the climate to revert to something close to that, it would be undeniably good for the Seaport. After all, management has disclosed that rain hurts its business. But if you’re going to invest in this property, you have to answer for yourself how comfortable you are betting on the weather.
Investment sales picked up steam during the city's second quarter, but activity for the overall first half of the year remained historically slow, according to data from Ariel Property Advisors.
There were about $7.4 billion worth of deals citywide during the second quarter, up significantly from the frozen first quarter of 2024, the numbers show. These took place across 464 deals and 666 buildings.
The numbers put the totals for the first half of the year at about $11.8 billion worth of sales across 943 deals and 1,261 buildings, lower than every first half dating back to 2015 apart from 2020 and 2021, when the city was still deep in the grips of Covid.
First-half sales bottomed out at about $7.8 billion in 2021 but rebounded to about $22.3 billion by 2022, according to Ariel. Between 2015 and 2019, the slowest first half of the year was in 2017 with about $14.5 billion worth of sales.
Many in real estate cited stubbornly high interest rates as the main reason for the slow first quarter, and these have yet to go down significantly. A cut is still possible later in the year, but Ariel said persistent inflation could keep mortgage rates high.
"There's not enough time, given the timeline of a real estate transaction, for this to be a great year," said Eli Weiss, principal at the developer Joy Construction. "That said, every day that everyone in the industry feels like we're getting closer to rates coming down, you start to see more momentum."
New state policies such as the tax incentive for office-to-residential conversions and the 485-x affordable housing tax break seem to be sparking more interest in deals as well, and the City of Yes zoning changes that Mayor Eric Adams' administration is proposing could also provide a boost, according to Ariel.
These policies, along with upcoming mortgage maturities that will force sales and a "tremendous amount" of available capital, should lead to more deals moving forward even as the exact timeline for a big increase remains unclear, according to Ariel president Shimon Shkury.
"I don't know if the third quarter is going to be bigger, and the fourth quarter is going to be much, much bigger," he said, "but I think over the next 12 months, you will see a gradual increase in transaction volume."
Multifamily buildings made up the highest amount of dollar volume by asset class during the first half of 2024, at about $4.1 billion, followed by development sites at about $2.2 billion and hotels at about $2 billion. Ariel said that unregulated residential buildings in particular were very popular given how strong rents have been.
The city's struggling office market sold about $827 million worth of properties during the first half of the year, the first time since at least 2015 when they did not crack $1 billion. However, Ariel categorized office buildings sold for residential conversions as development sites, and these made up half of all Manhattan development sales for the first half of the year.
A similar report from Avison Young on Manhattan investment sales specifically found that there were 60 deals worth $2.4 billion last quarter, up 20% and 13% compared to the first quarter, respectively. And Brooklyn had a busy second quarter with about $2.2 billion worth of deals, although roughly half of this was due to distressed sales of the Brooklyn Tower, the William Vale Hotel and a Downtown Brooklyn office tower, according to data from the Brooklyn-focused brokerage TerraCRG.
New York City built a record number of new affordable housing units in the last fiscal year thanks in large part to a tax break that expired two years ago, officials announced this week.
The city financed more than 25,000 affordable homes during the fiscal year that ended June 30 through a mix of tax breaks and subsidies. That’s an increase from the year before, and the 14,700 newly constructed homes is the highest annual number by more than 17%, according to data released by the Housing Preservation and Development department.
Much of that new building — about 5,400 units, or 40% of the total — occurred thanks to the 421-a property tax break, which expired in 2022 but has continued to cover projects already in the pipeline as long as they are built before 2026. (The latest state budget extended that deadline further, to 2031).
The tax break’s central role in construction reflects why Mayor Eric Adams’ administration pushed hard for 421-a to be replaced with a new program in Albany this year. In a Monday briefing, city housing officials said it’s too early to say whether the replacement program, 485-x, will produce less housing than before, as some developers have alleged.
“No one elected me to define the problem, they elected me to solve the problem, and damn it, we're solving the housing problem in the city,” Adams said in a press conference on Monday.
But officials acknowledged a decline in the number of existing affordable units that the city had paid to preserve, a result of staff vacancies at HPD that began during the pandemic. The city will try to hire temporary staff to reduce its backlog and has brought on consultants to process applications for funding, officials said.
Just under half the newly built units were for “extremely-low and very-low income” households, with rents set below 50% of the area median income. And 16% of all the homes financed last year were for formerly homeless households, totaling about 4,000 units — the most in history, officials said.
Adams will need to defend his record on housing when he runs for re-election next year, and all of his three challengers are sure to dwell on continually climbing rent prices. The mayor has embraced expanding supply as the simple solution to New York City’s housing crisis, and in the coming months will need to persuade the City Council to pass his ambitious City of Yes plan to relax zoning rules around housing.
The city also committed $2 billion in new capital funding for housing construction in the latest budget approved last month, a result of agitation from housing advocates and the City Council.
Leases
Durst lands new tenant by Grand Central
Address: 825 Third Ave., Manhattan
Landlord: The Durst Organization
Tenant: Stark Office Suites
Lease size: 11,816 square feet
Lease length: 17 years
Asset type: Office
Brokers: Savills' Craig Lemle and Roi Shleifer represented the tenant. Tom Bow, Ashlea Aaron, Sayo Kamara and Bailey Caliban represented the landlord in-house.
Infrastructure firm inks Rock Center lease
Address: 600 Fifth Ave., Manhattan
Landlord: Tishman Speyer
Tenant: Morrison
Lease size: 8,000 square feet
Asset type: Office
Brokers: CBRE represented the tenant.
Global Japanese anime chain takes NoHo corner berth
Address: 740 Broadway, Manhattan
Landlord: GFP Real Estate
Tenant: Book Off
Lease size: 2,000 square feet
Lease length: 10 years
Asset type: Mixed-use
Brokers: KSR's Dorel Melloul represented the tenant. Newmark's Ross Kaplan and Will Chaplin represented the landlord, along with Neith Stone in-house.
Sales
Investment arm of MassMutual unloads FiDi office tower
Address: 100 Wall St., Manhattan
Seller: Barings
Buyer: David Werner
Sale price: $116 million
Asset type: Mixed-use
Financings
New Empire Corp. lands financing for new Long Island City mixed-use buildings
Address: 24-01 Queens Plaza North and 41-43 24th St., Queens
Owner: Bentley Zhao
Lender: Axos Bank
Loan amount: $54 million
Asset type: Multifamily
New York City’s aging transit system needs 2,000 new subway and commuter rail cars, 60 miles of new subway tracks and upgraded power stations.
The Metropolitan Transportation Authority previewed the laundry list of improvements on Monday as part of its 2025-2029 capital program, which funds infrastructure work across the agency’s network of subways, buses and commuter rail roads.
While the MTA must submit a multi-year capital budget to state legislators in October, lawmakers most likely won’t resolve how that spending plan will be funded until next year during the state’s own budget process. MTA officials have said the upcoming plan will exceed its current $51.5 billion program due to inflation, but did not specify the costs.
“What we’re trying to do is to get the major stakeholders — and you know who they are — to start to think directly about what size of the capital program they’re prepared to support,” Janno Lieber, the MTA’s chief executive, said Monday during a capital program committee meeting with board members.
The MTA needs to modernize a more than 100-year-old transit network to improve service, replace equipment and train cars that are beyond their useful life and strengthen an aging system that gets pummeled with heavy rain and rising sea levels.
Thomas DiNapoli, the state’s comptroller, estimates the MTA needs to spend $43 billion in the next five years just to keep its assets in working condition.
The upcoming capital plan needs to fund more than $4 billion in power substation upgrades, provide about $7.4 billion to fix structural defects on elevated structures and tunnels and bridges, and overhaul Grand Central Terminal’s 110-year-old train shed, the MTA said.
“When we look at structures, tunnels, train sheds, elevated structures, we see a condition of historic underinvestment and the risk that assets are going to start falling apart,” Jamie Torres-Springer, head of the MTA’s construction and development, told board members during the committee meeting.
Improving the system will help increase ridership and boost farebox collections.
DiNapoli estimates a $25 billion shortfall in the MTA’s new five-year capital spending plan until Albany lawmakers craft a funding solution. Uncertainty with the MTA’s current plan may affect what infrastructure projects the transit provider can budget for in its next program.
Gov. Kathy Hochul paused a congestion pricing initiative that was set to start June 30 and forced the MTA to shelve $16.5 billion worth of infrastructure improvements, including signal upgrades, accessibility projects and extending the Second Avenue subway to Harlem. But MTA officials anticipate state lawmakers will address that shortfall and allow those projects to move forward.
“We are assuming that there is a source other than the MTA having to do new and unexpected borrowing for the $15 billion that congestion pricing was meant to fund,” Lieber said.
The MTA’s infrastructure spending falls short of similar investments made in the private sector, according to a JPMorgan Chase report. The transit provider needs to direct $23 billion a year to capital projects — far short of the roughly $6 billion it allocates now annually — to bring infrastructure investment in line with what’s spent among similar entities, the report said.
The MTA needs to boost its capital investments to match the amount of such spending among freight rail, electric utilities, shipping companies and the airline and automobile industries, according to the report. It needs to spend $16 billion annually to support its infrastructure in addition to $7 billion a year to update depreciated assets.
The transit provider had $47.4 billion of outstanding debt as of July 24, according to MTA data. It pays nearly $3 billion a year in principal and interest costs, taking up about 15% of its operating budget, Kevin Willens, the MTA’s chief financial officer, said during a finance committee meeting on Monday.
But those debt-service costs will account for a larger chunk of the MTA’s operating budget if it is forced to sell additional debt for the new five-year capital program, Willens said. The MTA would need to increase fares and tolls by 8% to repay $10 billion of additional debt without a new funding source, he added.
“It’s important for our funding partners — federal state and city — to really help fund the next capital plan,” Willens said. “It can’t be done from fares alone.”
Pfizer Inc. raised its profit expectations for the year, citing new cancer drugs, as it seeks to dig out of a Covid-related hole in sales.
The New York-based drugmaker is working to persuade investors that its other drugs can offset the dramatic revenue decline of its Covid vaccine and pill, which led to a more than 40% drop in its stock price last year.
Pfizer said Tuesday it now expects 2024 adjusted earnings between $2.45 a share to $2.65 a share, 30 cents higher at the midpoint than its prior projection.
The shares rose as much as 1.4% at the New York market open, a muted reaction to the new outlook, as investors searched for sustainable growth in Pfizer’s results. Among the drugs that beat expectations was the Covid pill Paxlovid, whose future is uncertain, and Vyndaqel, a treatment for a rare cardiovascular disease that will face competition in the coming years.
“Ultimately, we believe stronger new launch performance and/or further progress on the pipeline will be necessary to significantly change the narrative on the stock, which we see as more likely in 2025 or beyond,” JPMorgan analyst Chris Schott wrote in a note to investors.
Pfizer is betting on cancer to help it return to growth, buying oncology company Seagen Inc. for $43 billion last year. Revenue from Seagen’s drugs added $845 million in the quarter, led by Padcev, which beat expectations with revenue of $394 million.
Beating estimates
Overall, the company’s second-quarter earnings of 60 cents a share beat analysts’ average estimates of 46 cents, while revenue of $13.3 billion nosed out analysts’ expectations.
In May, Pfizer embarked on a cost-cutting plan that will save $1.5 billion by the end of 2027. That came on top of a previously disclosed effort to reduce spending by $4 billion through 2024. In the earnings results, management said they were on track to meet those goals.
Pfizer said earlier this month that it’s moving forward with a weight-loss pill that would rival injectable medicines like Novo Nordisk A/S’s Wegovy. Pfizer’s pill is slated to enter mid-stage development this year.
Also earlier this month, Pfizer said long-time Chief Scientific Officer Mikael Dolsten will leave the company after assisting in the search for his successor.
City comptroller Brad Lander will challenge Mayor Eric Adams for re-election next year, making the progressive Brooklyn Democrat the highest-profile person to declare against Adams — and setting up an unusual scramble to fill Lander’s current position.
Lander announced his campaign in a television interview and on social media Tuesday morning, pitching himself as a “strong, experienced” leader capable of delivering results.
“Nothing can replace New York City, but we can replace a leader when they fail the basic tests of the job: to be honest with us, to keep our families safe, to make sure our kids learn,” Lander intoned in a campaign video posted to X. He alluded to public safety, affordable housing, and Adams’ unpopular budget cuts to public libraries.
Long seen as a mayoral aspirant, Lander enters the race with a history of antagonizing Adams in his role as comptroller. Lander has issued audits faulting the mayor for his handling of the migrant crisis, homelessness, policing technology and emergency response — appearing to get under the skin of the mayor, who at one point last year mockingly imitated Lander’s voice and called him “the loudest person in the city.”
As a white progressive, Lander could have a challenging time cobbling together a voting base that rivals Adams’ historically strong support in working-class outer-borough neighborhoods. And Lander hardly has the field to himself, with State Sen. Zellnor Myrie and former comptroller Scott Stringer also in the race.
Lander had only about $156,000 in campaign money on hand as of mid-July, less than all of his rivals and well short of Adams — although public matching funds will help even the field. Lander, unlike the other challengers, was elected citywide in 2021, and won a difficult primary race for comptroller against then-Council Speaker Corey Johnson.
Running for mayor means Lander would be giving up his comptroller seat after just one of his two allowed terms, and other prominent elected officials are already angling to replace Lander as the city’s fiscal watchdog. Manhattan Borough President Mark Levine is likely to run for comptroller; Brooklyn Borough President Antonio Reynoso may also run, and Queens Assemblywoman Jenifer Rajkumar has already signaled she plans to enter the race.
Their candidacies would create even more vacancies — in Manhattan, for example, East Side City Councilman Keith Powers is making calls about a potential borough president campaign.
Rajkumar, an omnipresent Adams ally, immediately called on Lander Tuesday not to “disgrace his office” by reverting back to running for comptroller if he deems he lacks a clear path to winning the mayor’s race — a backup plan for Lander that some observers see as a possibility.
INTERPRETATION CONTRACT: New York City’s public hospital system is increasing spending on interpretation services by $126 million over five years. The board of directors of New York City Health + Hospitals approved contracts with eight vendors to cover interpretation by phone, video, and in person in a meeting last week. The spending comes as the demand for translations across the system has ballooned in the last year. H+H used more than 35 million minutes of interpretation last fiscal year, which cost the system $24 million.
BEHAVIORAL HEALTH WORKFORCE: Health + Hospitals received a $5 million donation to support the behavioral health workforce amid an industry-wide labor shortage and high turnover. The funding, from Black Family Philanthropies, includes $4 million for the student debt relief for staff who make a three-year commitment to public hospitals. The system expects to provide relief to 120 behavioral health providers over the next two years. The remaining $1 million will go toward career advancement and workplace safety measures aimed at boosting staff retention.
CDPAP PROTEST: Supporters of the state’s Consumer Directed Personal Assistance Program staged a demonstration outside the Governor’s Mansion on Monday after Governor Kathy Hochul called the program a “racket.” The program, which can pays family and friends to care for their loved-ones through Medicaid, has been a key driver of job growth in New York and subject of criticism for the governor, who has sought to rein it in. The protest was organized by the New York Caring Majority and took place outside the Governor’s Disability Pride Reception.
NYU Langone Hospitals nabbed a 5% operating margin in the last quarter, thanks to continued growth in revenue from patient care and a bump in pharmaceutical sales.
The Midtown East-based health system brought in $2.3 billion in revenue between March and May, which covers the third quarter of NYU’s fiscal year, according to a financial statement released Monday.
The quarterly revenue represents just a portion of the $7 billion that NYU has brought in since the beginning of its fiscal year last September. The hospital has increased its revenue more than 14% since the same time in 2023, which spokesman Steve Ritea attributed to continued growth in patient volume.
NYU Langone discharged more than 94,000 patients from its hospitals during this fiscal year, up 6% from the same time last year. Patient services revenue totaled $5.9 billion in the first three quarters of this year.
While patient revenues continued to grow, a rise in pharmacy sales also boosted NYU’s operating performance. Pharmacy sales reached nearly $630 million, an increase of $133 million from the previous year.
Local hospitals are making money again after years of inflationary pressures and rising labor costs that they say tanked their bottom lines. Revenue from patient services and pharmacy sales has buoyed finances in the last few years, even as many hospitals face high expenses to hire doctors and nurses and cover the costs of medical supplies.
NYU Langone racked up total expenses of $2.1 billion in the third quarter of this year, which includes $657 million in wage expenses and $219 million in benefit expenses. The health system spent $1.2 billion on supplies, reflecting cost pressures from continued drug shortages.
Despite cost increases, NYU Langone still reported an operating surplus of $119 million in the first quarter.
NYU Langone consistently reports higher profitability than other hospitals in New York City. But its recent operating successes reflect higher profits in recent months recorded by hospitals in the Northeast and Mid-Atlantic regions. Operating margins of local hospitals have climbed since February, reaching a median of 5.9% for the month of June, according to data from Chicago-based data firm Strata Decision Technology.
NYU Langone has six hospitals and 300 physician practices and clinics in the New York City region and Florida.
Vending machines stocked with snacks, beverages and other conveniences are coming to two dozen subway stations in the place of long-defunct newsstands.
The Metropolitan Transportation Authority is set to ink a five-year license agreement with Mount Vernon-based CC Vending to install 28 cashless vending machines at subway stations across Manhattan, Brooklyn and Queens, according to a license agreement approved by the authority’s finance committee Monday. The MTA’s full board is expected to approve the contract Wednesday.
Transit officials say they aim for the vending machines to help revitalize stubbornly vacant underground retail while offering riders revenue-generating amenities. CC Vending would lease the retail berths at a base rent of $102,500 each year for five years, with a 14% revenue share of total sales over $1 million. As part of the agreement, the MTA would gut existing newsstands at several of the stations in preparation for some $800,000 in design and safety upgrades CC Vending intends to make at the locations, which include the Wall Street, Atlantic Avenue-Barclays Center and Flushing-Main Street stations, according to MTA documents.
Currently, just 52 of 195 available storefronts in the subway are open, with 20 under construction and 31 that are in contract negotiations, according to the MTA. Retail spaces in the subway generated $9.5 million for the MTA in 2019 but are only projected to generate some $4.3 million this year. In the wake of the pandemic and a shift in consumer shopping habits, the authority is looking for new ways to generate cash and hopes having the vending machines in place of empty retails spaces will add a bit more liveliness to the system.
Some CVS vending machines currently pepper the system. The MTA also plans to rent out space to Wells Fargo for ATMs at four stations — 34th Street-Herald Square, 14th Street-Union Square, Gun Hill Road and Jackson Heights-Roosevelt Avenue/74th Street.
The vending machines will sell various snacks, beverages, prepackaged food and electronic items, according to the agreement. Down the road CC Vending has the option to add machines and experiment with other models, such as those that sell hot and cold prepared meals.
MTA spokeswoman Kayla Shults says the authority is still working out the details and doesn’t currently have a timeline to launch the vending machines.
The subway stations that will receive vending machines are as follows:
South Ferry/White Hall Street
Wall Street
Canal Street (two locations)
Prince Street
Chambers Street
Christopher Street
Grand Street
Eighth Street – New York University (two locations)
23rd Street – Broadway
23rd Street – Lexington Avenue
Second Avenue (on the F Line)
Fifth Avenue (two locations)
86th Street – Broadway
86th Street – Lexington Avenue
96th Street – Lexington Avenue
116th Street and Lexington Avenue
125th Street and Lenox Avenue
Dekalb Avenue
Brooklyn Bridge – City Hall
Atlantic Avenue – Barclays Center
Jamaica – 179th Street
Flushing – Main Street (two locations)
Woodhaven Boulevard
61 Street – Woodside
New York Democrats are thrilled that Kamala Harris will now top the presidential ticket.
Harris is still something of an underdog against Donald Trump in the fall, but she immediately seemed to ensure that an Electoral College landslide and down-ballot disaster aren’t in the cards for Democrats. Joe Biden was polling increasingly poorly against Trump, as concerns about his advanced age and ability to campaign mounted — his June debate performance was catastrophic — and Democrats in swing House seats wondered if they were all collectively doomed.
The vice president has her own flaws as a political candidate, and it remains to be seen what her coattails really look like. What she’ll be able to do is press the case against Trump, speak coherently and campaign extensively. Harris won’t shy from media appearances. Her running mate, too, is likely to be a talented, battle-tested politician — possibilities including North Carolina Gov. Roy Cooper, Arizona Sen. Mark Kelly, and Pennsylvania Gov. Josh Shapiro — who can bolster her candidacy.
In New York, the Harris campaign’s goal will be, at the minimum, to match or come close to Biden’s 2020 performance. Biden won 61% to Trump’s 38% with minimal votes for third-party candidates. The Greens lost their ballot status for 2024, but Robert F. Kennedy Jr., as an independent, will be on the ballot, and it’s plausible he will siphon votes from Harris as well as from Trump. Democrats are now excited for Harris, which should help her, and liberal revulsion for Trump should keep him under 40% — and nowhere close to the 47% Lee Zeldin won in the 2022 governor’s race against Kathy Hochul.
For Democrats to take control of the House and make Brooklyn's Hakeem Jeffries the speaker, there are at least three incumbent Republicans in New York they must defeat. All are freshmen. They are Anthony D’Esposito on the South Shore of Long Island, Mike Lawler in Westchester and the Hudson Valley, and Brandon Williams in the Syracuse area. They also may need to knock off Marc Molinaro, a Hudson Valley moderate who is also in his first term.
Biden’s 2020 coattails helped hand victory to most of the Democrats who previously held versions of those House seats. D’Esposito and Williams were probably hurt most by Biden’s 11th-hour decision to drop out of the presidential race, since they represent districts that are plainly Democrat-friendly. If Harris runs well enough, they might both be finished.
Lawler’s race against Mondaire Jones, who used to serve in Congress, is a genuine toss-up. Lawler has distinguished himself as a charismatic young conservative in the way Jones once did as a progressive in Washington. After a failed run for an open House seat in Brooklyn and Manhattan, Jones has now tacked to the center — he endorsed against Jamaal Bowman earlier this year — and is trying to win over swing voters skeptical of New York City liberals.
When Biden stepped aside and endorsed Harris, Lawler was one of the few Republicans to offer kind words for the president. He also attended the Republican National Convention and praised Trump without issuing a formal endorsement. It’s unclear if he’ll be able to keep walking this political tightrope — Jones has bashed him repeatedly for being a Trump Republican — but he will be a tough incumbent to knock off.
Molinaro, too, will be a reach for Democrats. His district has traded off between Democrats and Republicans; Hochul’s lieutenant governor, Antonio Delgado, used to represent a version of it in Congress. But Molinaro, a former Dutchess County executive, is the sort of Republican who has run well in the Hudson Valley in the past, distancing himself from the most conservative elements of his party. Democrat Josh Riley is taking another crack at him, and his goal will be to tie him as closely as possible to the Trump-Vance ticket.
Keep an eye, finally, on the East End of Long Island, where Zeldin used to be a congressman. The district has trended right for a decade, and Nick LaLota, another Republican freshman, won it easily in 2022. He should win again. But John Avlon, a former CNN host and Giuliani speechwriter, is making a bid as a centrist Democrat. He’s been a strong fundraiser, thus far, and he’s hoping to pull off the upset. It’s not an impossibility.
Ross Barkan is a journalist and author in New York City.
The site of a massive migrant shelter in Brooklyn that's recently become the target of protests could be converted into a sprawling residential and retail complex, according to a new filing with the city.
Real estate giant RXR Realty submitted plans with the Department of City Planning Friday to turn 47 Hall St. in Clinton Hill, which is temporarily being used as a humanitarian emergency response and relief center, into a mixed-use campus with more than 600 apartments. The proposal did not contain a cost estimate.
The full-block, 113,833-square-foot development site between Park and Flushing avenues, right under the Brooklyn-Queens Expressway and across the street from the Brooklyn Navy Yard, comprises 10 former warehouse buildings — portions of which are being used to house migrants at the New York City Health + Hospitals-run facility. A second shelter housing roughly 800 migrants sits a block away at 29 Ryerson St., and tensions between those staying at both facilities have escalated in the neighborhood. Residents have been calling for beefed-up security in recent days, especially in the aftermath of a nearby shooting, which left two men dead, and staged a protest in front of the Hall Street shelter last week, deeming it too large to be secure.
RXR acquired the Hall Street property in 2016 for more than $160 million and three years later had completed $100 million in extensive renovations to the site with the hope of turning the buildings into luxury office space, dubbed The Hall. But when the pandemic hit just months later, those plans came to a halt, and the modernized buildings sat vacant until last year, when the city began using the space to house families and children, now more than 3,000 asylum seekers. RXR's lease with Health + Hospitals is set to expire in March.
As part of the 933,422-square-foot redevelopment project, two of buildings — the state of which is unclear — would be razed to make way for a 21-story mixed-use tower; a third building would be converted into residential. The properties together would include 611 apartments, about 153 to 183 of which would be set aside as affordable. The remaining seven buildings would contain a mix of commercial, retail and self-storage space across about 300,000 square feet, according to the application documents.
City Hall declined to comment on where and when the more than 3,000 migrants currently living on Hall Street will be moved within the next eight months if the lease is not renewed before March — which is still being discussed — but said that RXR's plans for the site will not impact the city's contract to run the temporary shelter. And before RXR can break ground, the city must sign off on its rezoning application as part of the city's lengthy uniform land-use review procedure, which requires approval from the Brooklyn borough president, the local community board and the City Council. If approved, RXR's plans for the site are not slated to be completed until 2030.
RXR said in a statement to Crain's that the project would transform an "underutilized property" into a "vibrant, mixed-use campus."
A short-lived dorm for a closed Christian college is preparing to return to its roots as a hotel.
Hotelier Ravinder Chopra has scooped up 102 Greenwich St. in the Financial District, a 5-story former student residence for The King’s College, an evangelical institution that shuttered last year in the face of mounting debts and declining enrollment.
Chopra, an owner and operator whose previous sites are mostly midmarket properties in Queens, paid $15.3 million for the mixed-use building in a deal that closed July 15, according to the city register. After investing about $1 million in painting, furniture and other cosmetic upgrades, the site will reopen as the 36-room Tribeca Hotel FiDi by the end of August, Chopra told Crain’s.
Though the small lodging won’t significantly boost the supply of hotel rooms in Manhattan, No. 102 will represent a rare recent hotel opening in New York, where many properties found more lucrative uses as migrant shelters after tourism collapsed during the pandemic.
“The site is in good condition,” Chopra said. “And we like that it’s near the Statue of Liberty, Ground Zero and Wall Street.”
The sale of the Greenwich Street dorm seems to have been a money loser for the school, which saw its enrollment cut in half in recent years, from 600 to 300 students, and which reportedly failed to meet a nearly $3 million fundraising goal before it folded for good.
In 2018 the college bought the site, which was formerly the Riff Downtown Hotel, for $19.2 million and so incurred a 20% loss in the transaction, the register shows. Brokers had marketed the property, near Rector Street, for two years.
Founded in 1938 in New Jersey and closed for the first time in 1994 after losing its accreditation and filing for bankruptcy protection, The King’s College, which promised “Christ, curriculum, community, city,” according to its website, relaunched in 1999 with leased space in the Empire State Building.
In 2012 it relocated to the Financial District with classroom space at 56 Broadway, a Jack Resnick & Sons-owned office tower a few blocks away. The dorm at 102 Greenwich followed a few years later. It was known as DeVos Hall, named for the family of Amway company co-founder Richard DeVos, a major benefactor of the college who died in 2018. His daughter-in-law Betsy DeVos served as secretary of education under former President Donald Trump.
Despite its ties to Republican politicians, The King’s College in recent years strove to be antipolitical, an effort that may have hurt fundraising, according to reports, though the school’s president from 2010 to 2012 was author and right-wing firebrand Dinesh D’Souza.
For his part, Chopra, who works alongside sons Yuvraj and Kuwar Chopra, owns Queens properties such as Hotel Key Flushing at 33-53 Farrington St. and Sky Hotel Flushing at 133-43 37th Ave., with another property, Lux Hotel LIC, to open at 37-25 12th St. in Long Island City later this year, he said.
Though hotel development appears to have been a bit constrained by a 2021 rule requiring special zoning approval for some new properties, the requirement did not apply to 102 Greenwich because the site had already functioned as a hotel prior to its turn as a dorm, Chopra explained.
Zaza Diner, which currently occupies No. 102’s ground-floor space, will remain in the berth despite the site’s makeover, he added.
Embattled developer Ben Ashkenazy has tapped one of his properties, an Upper West Side hotel, for nearly $80 million in cash.
The investor, who recently lost his stakes in two Madison Avenue office buildings to foreclosure, is locked in a long-running legal feud with partners. This month he took out an $85 million mortgage for the Arthouse Hotel at 2178 Broadway. About $2 million in proceeds will go to fix the hotel facade and most of the rest – $79.6 million – will go into the pockets of Ashkenazy and a partner, according to a new report from bond-rating firm KBRA.
A spokesman for Ashkenazy, Russ Colchamiro, said the loan replaces an $80 million mortgage paid off last November. He and described the new mortgage, written by Citigroup at a 7.38% interest rate and due in five years, as a routine transaction. Colchamiro denied the size of the cash-out reflects any pressing financial needs for Ashkenazy.
“It’s a run-of-the-mill refi,” Colchamiro said.
Cash could be helpful for Ashkenazy, who owns more than 100 commercial properties and whose net worth has fallen by 60% since 2019, to $1.6 billion, according to Forbes. Legal bills are piling up as the fourth anniversary approaches for a courtroom brawl he instigated against the Gindi family, the owners of the Century 21 department store who invested in many of his projects. In the last several months Ashkenazy lost his stakes in the office buildings at 625 Madison and 635 Madison after failing to make good on obligations.
“Mr. Ashkenazy has reported involvement in a number of foreclosures and loan defaults in recent years,” KBRA said in its report last week about the hotel loan.
Ashkenazy has been in the real-estate arena since buying his first property at age 17 with a little help from his father.
“My long-term plan is to basically hold on to prime real estate,” he told Real Estate Weekly in 2001 in what appears to have been his last interview with the press.
Ashkenazy Acquisition Corp.’s holdings include a piece of the Plaza Hotel, Boston’s Faneuil Hall and South Station. Ashkenazy paid $750 million for London’s Grosvenor House hotel in 2017, a year after hiring the rap musician Drake to perform at his daughter’s bat mitzvah at the Rainbow Room, according to Bloomberg News. He acquired the 291-room Arthouse Hotel in 2016 for $140 million and has spent $10 million upgrading the rooms and lobby, KBRA said. The firm said it has an 80% occupancy rate and charges $300 per night for a room, producing $30 million in revenue last year and $11 million in net operating income.
Recently Ashkenazy’s strategy to hold on to prime real estate has hit a few roadblocks.
After acquiring the land underneath 625 Madison Ave. in 2013 for $400 million, he lost control of the property when he defaulted on a $195 million loan. SL Green, which provided the loan and owned the 560,000 square-foot office building, led a foreclosure auction last August to seize control and quickly sold the building to The Related Cos. for $635 million.
In a May foreclosure auction, a JPMorgan entity acquired the land under the building next door at 635 Madison after Ashkenazy defaulted on a $90 million loan for the ground lease. The sale price was just $18.6 million, according to records filed in a New York state court this month. Ashkenazy paid about $70 million for the lease in 2008.
Another foreclosure proceeding in 2022 ended with Ashkenazy losing a Chelsea building that housed the original Barney’s department store.
In the meantime, Ashkenazy is still slugging it out with the Gindi family. In November of 2020 he accused the Gindis of “shockingly and shamelessly” trying to take advantage of troubles caused by the pandemic. The Gindis countersued and accused him of illegally cutting them out of millions.
Charles Kushner, the former head of Kushner Cos., offered to broker peace 10 days after the legal war erupted.
“I know from personal experience that these fights have a life of their own and rarely end with a good conclusion,” he wrote to Ashkenazy and Raymond Gindi, according to an email filed in court. “You should be civil and stay out of court no matter what the dispute entails.”
Ashkenazy replied that he welcomed peace but his foe wouldn’t negotiate.
“Nothing would make me happier than to work things out amicably,” he wrote, “and save the assets before we lose some of them to the banks.”
Leases
Music firm inks lease in Haymarket Building
Address: 135 W. 29th St., Manhattan
Landlord: Kaufman Organization
Tenant: Firebird Music
Lease size: 6,810 square feet
Asking rent: $55 per square foot
Asset type: Office
Brokers: Grant Greenspan and William Landsburg represented the landlord in-house. JLL’s TJ Hochanadel and Dan Santagata represented the tenant.
Restaurant takes space in prewar building near Astor Place
Address: 740 Broadway, Manhattan
Landlord: GFP Real Estate
Tenant: Potbelly Sandwich Shop
Lease size: 1,483 square feet
Lease length: 15 years
Asset type: Mixed-use
Brokers: Newmark’s Ross Kaplan and Will Chaplin represented the landlord along with Neith Stone in-house. RJB Real Estate’s Richard Bailey represented the tenant.
Sales
Closed Christian college unloads Financial District dorm to hotelier
Address: 102 Greenwich St., Manhattan
Seller: The King’s College
Buyer: Ravinder Chopra
Sale price: $15.3 million
Asset type: Mixed-use
Financings
Bedford Park senior affordable development scores construction loan
Address: 2868 Webster Ave., Bronx
Owner: Douglaston Development
Lenders: Wells Fargo, Housing Development Corp. and Department of Housing Preservation and Development
Loan amount: $190 million
Asset type: Multifamily
New York City, with its dazzling skyline and bustling streets, presents a façade of opportunities and dreams fulfilled. Yet, beneath our skyline, in our subways, there is a daily reality far removed from such lofty aspirations.
A recent study conducted by the New York Immigration Coalition and Algún Día, a project I co-founded, reveals a troubling scenario for new immigrant families: a dire lack of child care availability. That’s what compels children and their parents to sell candy and fruits in subway stations and parks across all five boroughs, a pursuit born out of necessity rather than choice.
Our investigation, involving heartfelt conversations with 75 families engaged in vending, uncovers a stark picture: 42% of these families cite child care as a significant hurdle. The cascading effects of this challenge are profound, forcing parents to relinquish other employment opportunities and thrusting them into precarious situations devoid of stability and security. 88% of those surveyed turned to vending driven by a compelling need, while 83% harbor aspirations for alternate careers, aspirations stymied by the lack of child care support.
Our volunteers, a compassionate network of social workers, traversed the intricate maze of our subway system and parks, reaching out to these families. The stories we collected are a testament to the resilience and determination of our immigrant communities, yet they also underscore the acute desperation and challenges they face.
We do not have to wait for something bad to happen before taking action. The city has responded by bolstering Promise NYC, a program providing access to child care services for undocumented children and their families. This initiative is not merely a service; it represents a lifeline for families on the brink, enabling parents to pursue gainful employment while ensuring their children's safety and development in nurturing environments. As part of the city’s recent budget, a $25 million investment in Promise NYC will restore vital programs facilitating family communication and outreach.
After walking the subways and engaging with these families, I am more convinced than ever of the transformative potential of comprehensive child care support. These families, brought here by aspirations for a brighter future, should not be relegated to the shadows of our society. I came to the U.S. as a teenager to reunite with my undocumented parents, who had left me in Ecuador for five years to fend for myself. They made stark choices when they came to the U.S., ones that no family should have to endure. And I understand from experience that immigrants in the U.S. possess deep wells of strength.
While many young people may feel disillusioned by political engagement or even by issues such as immigration in the abstract, engaging with these families on a local level reminds me of the power we have when our political and social interests ignite action. In 2016, I was one of the first graduates of the Dr. Anne Moses Ignite Fellowship, a program that empowers young women to engage politically and civically. What I learned then was that even if one doesn’t think of oneself as political, it’s about finding the local issues that motivate you to act. This is mine.
By fully funding Promise NYC and expanding programs focused on helping families find economic stability and opportunity, we will convert the fears and uncertainties of our immigrant neighbors into opportunities for growth and participation. I want us to ensure that New York City remains a beacon of hope and a place where dreams can be realized.
Monica Sibri is a co-founder of Algún Día and a senior advisor to IncludUs Fund, a non-profit organization dedicated to creating a more inclusive and equitable world.
After getting fierce industry pushback, the City Council hit the brakes on a union-backed bill that would require hotels to have a license to operate in New York City. The bill would limit hiring subcontracted workers and bolster the hotel union’s power.
Hotel, real estate and restaurant groups were preparing a show of force for Tuesday’s hearing on the bill, which is sponsored by Manhattan Councilwoman Julie Menin. But Menin announced on Sunday that she had decided to postpone the hearing to allow for more negotiations, slowing what had been a fast-moving effort to pass it.
The bill is being pushed by the Hotel and Gaming Trades Council, a powerful hotel workers’ union. The delay came after the Hotel Association for New York City, an industry group that represents owners, contacted the union on Sunday to express openness to negotiations and requested a delay until mid-October, two people familiar with the situation told Crain’s.
“This is a very positive development that the parties now have an open line of communication to negotiate the bill,” Menin said in an interview on Monday.
The New York Hospitality Alliance and the Real Estate Board of New York had planned to join the hotel association in a Tuesday rally against the bill.
Hotel executives had been using apocalyptic language to describe the bill and have heavily lobbied lawmakers against it.
Vijay Dandapani, president and CEO of the hotel association, had likened it to “a nuclear bomb” that would “destroy a major segment of the industry.” Kevin Carey, interim president of the American Hotel and Lodging Association, said the hearing delay would help “avert an economic disaster.”
Menin calls the legislation a modest response to safety concerns by regulating hotels in a manner similar to Chicago and Boston, which already require licenses. But to qualify for a license under the bill, hotels would need to meet new standards — including directly employing housekeepers, front desk workers, cooks, food servers and security guards, rather than contracting out those functions.
That significant new rule would please the HTC union, which has pushed versions of the bill for years. Most nonunion hotels hire subcontracted workers, and HTC said those employees tend to be paid less and held to less stringent safety and cleanliness standards.
Menin, an Upper East Side lawmaker, pointed last week to the bygone Umbrella Hotel in Kew Gardens, Queens, which was dogged for years by crime complaints before the city finally shut it down in 2021. Licensing hotels would let the city better regulate “bad actors” that are home to prostitution and unsanitary conditions, she argued.
“Most hotels are great operators — we’re not looking to do anything that would hurt their bottom line,” Menin said on Friday, before the hearing was delayed. “This is a public safety bill.”
But the hotel industry said the bill would create major new costs for smaller operators that rely on subcontracted work, and industry leaders bristled at the claim that hotels are rife with safety issues.
The bill’s passage would be a loss for the hotel industry at a moment when it is otherwise riding high, as occupancy swells thanks in part to the city’s use of rooms to house migrants. Ultimately, industry leaders warn, the bill could force hotels to charge more for rooms at a moment when nightly rates are already climbing.
Menin is widely expected to run for City Council Speaker once current Speaker Adrienne Adams is term-limited out of office in 2026, and labor support can be crucial in that contest. But Menin denied in an interview that lining up support from the hotel union had factored into her decision to take up the bill, noting that the licensing concept had been proposed as far back as 2019.
Restaurants see an ‘existential threat’
Other industries say the bill would have knock-on effects. Although the subcontracting ban would not typically apply to businesses like restaurants or spas that lease space in hotels, it would remain in force for any commercial tenants that provide public access to the hotel or that enter guest rooms.
Andrew Rigie, executive director of the New York Hospitality Alliance, believes it would apply to many hotel bars and restaurants, which often have public entrances or enter guests’ rooms to provide room service. Forcing those employees to be directly employed by hotels will pose an “existential threat” to the restaurants, Rigie said in a text message.
“If enacted into law, this legislation will essentially terminate countless leases and management agreements as they’re structured between third-party food and beverage companies and the hotels in which they operate,” Rigie’s group wrote in a message to members on Thursday.
Even the bill’s well-resourced opponents could have a hard time stopping it, given the political strength of HTC. The union, an early supporter of Mayor Eric Adams’, also shepherded the 2021 law requiring special permits for new hotels that has brought hotel construction to a standstill.
The licensing bill, introduced in mid-July, already has support from 26 council members, a majority. Menin noted that the bill has been amended in response to some industry concerns — it no longer sets minimum staffing levels for front desks and security, and it removed the ability of the city’s Consumer and Worker Protection commissioner to rule on each license application, which hotel owners worried would spook lenders.
“I’m completely open to additional changes and want to listen to industry to hear their concerns,” Menin said.
Other sections of the bill would require hotels to create “panic buttons” for employees to press when they spot danger and task hotels with creating a “sanitation policy” that describes how they clean surfaces and mitigate rodents.
The hearing’s delay came after Dandapani, representing New York hotels, wrote a letter to HTC President Rich Maroko on Sunday requesting more time to consult with members, according to a copy viewed by Crain’s. Menin agreed to the delay after HTC relayed the request.
“We look forward to productive dialogue with [the hotel association] and others so we can achieve an effective set of regulations to protect hotel workers, guests, and neighborhoods,” HTC wrote Sunday on social media.
More patients with opioid addiction are getting into treatment thanks to a unique program at New York City Health + Hospitals that aims to fill a gap in specialized treatment for substance use disorder, a new study shows.
Hospitals are one of the most common medical touchpoints for people addicted to opioids and other drugs. The program, known as Consult for Addiction Treatment and Care in Hospitals, takes advantage of that setting to connect opioid users to medication, social workers, and peer support. Patients who went through the city-funded program were eight times more likely to start treatment and seven times more likely to remain on medication for 30 days, according to a study released Monday by NYU Grossman School of Medicine.
“That kind of addictions-focused treatment essentially never happens in the hospital unless you have a program like this,” said Dr. Jennifer McNeely, an associate professor in the Departments of Population Health and Medicine and the study’s prime author. McNeely hopes the findings will encourage more hospitals to invest in similar programs.
NYU School of Medicine received a $2.75 million grant from the National Institute on Drug Abuse to study the effectiveness of the initiative over three years in collaboration with Health + Hospitals. It is the first major randomized trial of hospital-based programs for opioid use disorder treatment, sometimes known as addiction consult programs.
The program launched in 2018 with $7.5 million in initial funding under an opioid initiative known as HealingNYC, an offshoot of Mayor Bill de Blasio’s ThriveNYC, to curb an explosion in opioid deaths. It now receives $8 million in city funds annually and is available at six H+H sites, according to spokeswoman Stephanie Buhle. Any patient who uses drugs or alcohol, regardless of insurance and the reason they entered the hospital, may participate.
While medication, like methadone and buprenorphine, have been proven to effectively treat addiction long term by satisfying the brain’s opioid receptors, lack of insurance, stigma and a history of mistreatment prevent many people from receiving it, McNeely said. Only 22% of Americans with opioid use disorder take them, according to an analysis of data from the National Survey on Drug Use and Health that was cited in the report.
In many cases, the emergency department is the first point of contact between a person with addiction and a clinician. People with substance use disorders are on average more likely to come to the emergency department because of another issue, McNeely said. In the three years prior to the study period, more than half had three or more emergency department visits, with an average of 13 visits per person over three years.
The study looked at the impact of the program on 2,315 adult participants receiving Medicaid between October 2017 and January 2021. While the participant pool roughly reflected the racial make-up of opioid users who are Medicaid recipients, McNeely said it may underrepresent the number of female opioid users in New York City.
More than 3,000 New Yorkers died of an unintentional overdose in fiscal year 2023, according to the Mayor’s Management Report. Meanwhile, the number of patients on buprenorphine from fiscal year 2021 to 2023 fell by 5%.
When it was first announced, the program aimed to reach 8,000 patients across the six hospitals each year when fully scaled up. Between September 2018 and June 2024, 18,700 patients passed through the program, receiving a total of close to 31,000 consultations, according to Buhle.
Despite the efficacy of the program, McNeely said more needs to be done to lower barriers to treatment.
“The rates of treatment initiation after hospitalization are still a lot lower than we would like them to be,” she said.
The issue
Maybe your favorite tree is a stately pin oak or a London plane tree that greets you every time you step outside, or there’s a lush row of American elm trees you walk slightly out of your way to enjoy. The city’s more than 5.7 million trees beautify blocks, boost property values and play an increasingly important role in addressing climate change by cleaning the air, cooling streets and buildings, sopping up flood waters and capturing planet-warming carbon. And trees are an investment with staying power; the city’s oldest planted tree is supposedly an enormous tulip tree in Alley Park Pond in Queens that was a sapling more than 350 years ago.
Planting more trees and preserving the ones we already have is perhaps more important now than ever, but it’s not as simple as plopping a sapling in some soil and watering it. Growing the city’s urban forest — 53% of the city’s trees fall under the purview of the city’s Parks Department — is time-consuming and costly. In Fiscal Year 2024, which just ended in June, the average cost for the city to plant a tree was an eye-popping $3,300, according to the Parks Department.
The players
For street trees in particular, foresters with the city’s Parks Department survey planting spots to ensure a tree can survive there and that its roots won’t interfere with the spaghetti of underground infrastructure. One of the city’s planting contractors may have to cut out a chunk of sidewalk or have a dead tree stump removed. There are more than 130 different tree types the city uses for curbside planting, and a variety of factors help determine which one to plant. Among the most common new plantings are Thornless Honeylocust, Swamp White Oak and European Hornbeam trees. Parks workers source the trees from local growers and plant them either between February and March or between September and October.
The job doesn’t end there. The city contractor that planted the tree must conduct regular maintenance on it for two years, for things like replacing missing soil, weed removal and pruning. New trees are pretty easily spotted by the two wooden stakes installed on either side of them for support. Some also come with tags declaring “I’m your new tree” with the name of the tree species and a QR code that the city uses to track contractor maintenance. Street trees can also be requested by New Yorkers to be planted for free, by going through the city’s tree service request system or by calling 311.
The challenges
The Adams administration has made noteworthy progress on growing the city’s tree canopy with 17,678 tree plantings along streets and in landscaped parks this past fiscal year; another 18,000 were planted in the city’s more wild “natural areas” — think forests, wetlands and grasslands, according to city data shared with Crain’s. This past fiscal year marks the third in which the Parks Department has increased the number of trees planted in the city. The more than 35,000 new trees represent the largest tree planting total in the last eight years, and 7,301 of the new trees were planted in heat-vulnerable neighborhoods and parks. But some researchers and parks advocates say that onerous city contracting processes and red tape contributes to higher than necessary costs compared to the private sector.
“Contractors know that when it comes to working with the city, it can often be painful to get paid and time consuming to deal with the city's own requirements — they price all of those things in,” said Eli Dvorkin, the editorial and policy director for The Center For An Urban Future, a nonpartisan policy organization.
Budget cuts also threaten maintenance work that ensures the city's trees stay healthy. The Parks Department received about $20 million less this budget season than it did the previous year. “They are constantly having to do more with less, and that is a really big challenge,” said Tami Lin-Moges, the Interim New York Cities Director at The Nature Conservancy, which convened and leads the Forest for All NYC coalition. "The funding is so variable year to year as well and that really impacts overall operations and longer-term planning because, again, trees are living organisms and you need to plan ahead."
Several variables go into the price tag for planting a tree, but on the private side, things tend to be a bit cheaper. Brooklyn-based Arborpolitan Tree & Garden Care typically charges clients between $1,200 and $1,600 to plant a street tree, according to Ethan Wood, an arborist with Arborpolitan. The company sells maintenance packages that can be as little as $150 or high as $400 per visit, depending on the type of tree.
Similarly, Bill Logan, the founder and lead arborist at Urban Arborists, says if they’re simply planting a tree in a private citizen’s front yard they would charge somewhere between $1,500 and $2,000. “We are not the cheapest,” said Logan, "because we not only plant the trees but we also give people protocol for taking care of them.”
What’s next
The Adams administration in its climate blueprint said it aims to bring the city’s tree canopy coverage to 30% — up from some 22%. The city doesn’t have a specific timeline it’s committed to achieving that goal. In the meantime, the Parks Department says that due to a $136 million investment included in the city’s budget for Fiscal Year 2023, the agency expects to plant a tree in “every viable spot in most heat-vulnerable neighborhoods” by 2027. A lack of trees in neighborhoods is a common denominator for a greater risk of death — some 350 New Yorkers die prematurely each year due to stifling weather.
A medical robotics startup in White Plains raised a $36 million Series B-1 funding round led by health care giant Northwell Health last week to automate laboratory processes that diagnose diseases like cancer.
Clarapath builds machines that prepare biopsy samples to be assessed by a pathologist, a physician who specializes in disease diagnosis. The platform slices biological tissue and places it onto glass slides for pathology review, automating a process that is typically done by a technician and prone to human error, said Eric Feinstein, the firm’s chief executive.
Health startups are trying to automate processes in health care as the industry grapples with continued workforce shortages. Most technology that has emerged so far has surrounded automation of surgery or physical rehabilitation.
But there’s also a shortage of histotechnologists, technicians who prepare tissue from biopsies, to process labs — leaving patients waiting sometimes weeks at a time for their medical test results, Feinstein said. There are roughly 250 such technicians serving all of New York state, he added.
Clarapath’s recent fundraising is expected to lead it to its first sale, and Feinstein said that the company plans to deliver a machine to a hospital in the Midwest in the next few weeks. The company will also use the funds to grow its workforce and continue advancing its SectionStar platform, he added.
Feinstein declined to disclose the price of Clarapath’s technology, but said it equates to the cost of two histotechnologists.
Northwell Health’s venture arm led the fundraising round, but other hospitals have also backed the firm. Clarapath has raised $75 million in total, with investments from the Mayo Clinic, New Orleans-based Ochsner Health and the University of Colorado’s CU Healthcare Innovation Fund.
Thousands of New Yorkers face lawsuits each year for unpaid hospital bills that threaten their savings accounts and get in the way of rent or food bills. The state’s public hospitals are responsible for most of them.
Public hospitals operated by the state, including those run by the State University of New York, filed suit against patients nearly 7,000 times last year, making up 80% of all medical debt lawsuits against patients in 2023, data from social welfare nonprofit the Community Service Society shows.
The most litigious of the state-run hospitals was SUNY’s Stony Brook University Hospital on Long Island, which filed 4,000 medical debt lawsuits against patients last year, according to the data.
The data comes from a recent report from the Community Service Society. Researchers searched state court records for medical debt cases filed by the Attorney General on behalf of the five hospitals operated by the state between 2019 and 2023, and identified and reviewed more than 16,000 cases during that time period.
Despite rising awareness of medical debt, many Americans still get hit with surprise hospital bills – a pattern that can prohibit people from seeking medical care. Around 6% of New Yorkers, or 740,000 people, had medical debt in collections as of February 2022, according to an analysis from the Washington, D.C.-based think tank the Urban Institute. Debts most commonly affect low-income people and individuals of color, specifically people who have gaps in insurance coverage.
Stony Brook University Hospital disputed the data. Brian Fullerton, the hospital’s chief revenue officer, said the attorney general's office filed a little over 3,000 lawsuits against patients last year, lower than the 4,000 highlighted in the report.
Stopping the suits
State-run hospitals say that they are required by law to take legal action against patients with medical debts. The state’s budget office sent a memo to hospitals in 2017 that required them to refer patients with outstanding debts of more than $2,500 to the state Attorney General’s office. The document does not include a requirement that hospitals offer financial assistance, which advocates say is a flaw of the policy.
SUNY Downstate's University Hospital does not pursue legal actions against patients on its own, but instead refers cases with past due accounts exceeding $2,500 to the attorney general “as part of the standard procedure for SUNY Hospitals,” said Dawn Skeete-Walker, spokeswoman for the medical center.
Stony Brook University Hospital also disputed claims that they do not use state funding to cover the costs of care for low-income and disadvantaged patients. Fullerton said that the hospital provides care to patients who cannot pay and sees health equity as a core part of its mission. It recoups roughly $4 million a year from legal actions from the Attorney General’s office, he added.
State lawmakers and advocates have attempted to put an end to lawsuits from state-run hospitals. State Sen. Gustavo Rivera and Assemblywoman Amy Paulin, who both serve as health committee chairs, introduced the Stop SUNY Suing Act last year to put a ban on lawsuits coming out of the five state-run medical centers.
But the bill didn’t get traction. That’s partly because the labor union Public Employees Federation – which represents 50,000 state workers including those employed by the SUNY system – opposed it, fearing that it would decimate revenue to hospitals that employ their members.
“The fact of the matter remains that the SUNY Hospitals do not have resources to outright forgive these debts,” the union said in an opposition memo sent to legislators in May. “The state of New York should not limit any revenue or cost recoupment opportunities for the
SUNY hospitals without establishing a dedicated, recurring revenue stream to meet the funding shortfall.”
Rivera said he would work hard to pass the legislation next year.
“It would be a sea change to lift the requirement that our state hospitals sue for medical debt,” Rivera told Crain’s in an emailed statement. SUNY receives millions in state funding to offer charity care, but reports show that many patients are not receiving that assistance, he added.
Gov. Kathy Hochul has also introduced initiatives to get hospitals to offer aid to low-income patients, and reduce the negative consequences of having medical debt. The governor signed a law last year that banned medical debts from showing up on patients’ credit reports – which can prevent people from taking out loans to buy a home or pay for college – and has greenlit new hospital financial aid requirements that are set to roll out in October. Additionally, new legislation in the budget prohibits hospitals from taking legal action against patients with incomes below 400% of the federal poverty level.
The high rate of litigation appears inconsistent with the governor’s stance.
“What’s so maddening about it is that it’s such a disconnect with the governor’s administration,” said Elisabeth Benjamin, vice president of health initiatives at the Community Service Society.
Although Stony Brook was the most litigious of the state-run hospitals, it’s not an anomaly. Upstate University Hospital in Syracuse filed more than 2,000 lawsuits against patients last year, and Downstate University Hospital in East Flatbush filed 163 cases.
Roswell Park Comprehensive Cancer Center in Buffalo sued patients over their medical debts 155 times last year. Helen Hayes Hospital in Rockland County – the least litigious of the state-run hospitals – sued patients 20 times, according to the Community Service Society.
State-run hospitals have ramped up the number of medical debt lawsuits they file against patients as their nonprofit and public counterparts have drastically slowed down. More than 200 nonprofit hospitals in New York were responsible for 75% of all medical debt lawsuits in the state in 2019, while state-run facilities filed 25% of cases. That ratio flipped by 2023, as suits filed by public and nonprofit hospitals declined.
Benjamin said that the new hospital financial aid requirements could ban hospitals from suing a large number of patients with medical debt. But the SUNY lawsuits represent a failure to protect patients, with government agencies passing around the blame, she added.
“It’s like a circular firing squad of the government,” Benjamin said. “The patients are kind of in the middle of that circle.”
OPIOID SETTLEMENT: New York will receive a portion of an $86-million, multistate settlement in principle with pharmaceutical manufacturer Indivior for its role in the opioid crisis, Attorney General Letitia James announced Friday. The agreement comes after a coalition of state attorneys general filed a lawsuit alleging the company targeted doctors with dangerous prescribing practices that fueled opioid addiction.
OVERDOSE EMERGENCY KITS: Domestic violence shelters and services providers will have access to federally-funded overdose emergency kits, stocked with the opioid reversal drug naloxone, Governor Kathy Hochul announced Friday. The kits will be distributed through Project COPE, a state harm reduction program funded by the federal Substance Abuse and Mental Health Services Administration, which will also offer training to providers. The state has distributed 700,000 kits in the last 18 months, according to the announcement.
RAPID HEPATITIS C TESTS: State-supported Drug User Health Hubs will be using new FDA-approved rapid hepatitis C testing to improve wait times and connection to treatment. The new testing technology uses a finger stick and can deliver results in less than an hour, according to the state Department of Health. There are twelve Drug User Health Hubs across the state, which focus primarily on opioid overdose prevention.
A scorching heat wave has plagued the city this summer, with real-feel temperatures routinely reaching triple digits. Local officials must acknowledge that many residents are at risk from the heat and ensure they have the resources they need to survive the stifling weather.
One solution is continuing to push for more money from the federally-funded Low-Income Home Energy Assistance Program, which foots the bill for residents to buy and install cooling units. Then, officials must ensure that the funds – which are distributed by Congress and allocated by the Department of Health and Human Services – are being stretched as far as possible. The program spent its full $22 million budget on 27,000 households, or about $815 per AC unit.
There’s an outsize demand for the program with about 2 million New Yorkers living below the poverty line. Though the city received $5 million more than last year, it ran out of funds on July 19, just 29 days into summer, Crain’s health care reporter Ethan Geringer-Sameth found. Last year, the program ran out of money even quicker: in just three weeks.
City and state officials must negotiate fair prices with vendors to ensure the funding is reaching more households. If the funding is still not enough to meet New Yorker’s needs, the city and state should tap local funding to supplement the program. The city also must continue to push for sufficient cooling systems in new buildings, as outlined in Mayor Eric Adams’ strategic plan for climate resilience. The business community needs livable housing stock for its employees as temperatures rise.
New York City is a “heat island” – densely populated with skyscrapers, cars and buses with minimal tree cover. That leads to an average temperature that is 9.7 degrees hotter than it would be otherwise, which is the highest per-capita bump of 65 cities nationwide, according to a new report from the nonprofit Climate Central.
The city heat has sent at least 285 people to the emergency room so far this summer, a 74% increase over last year. The majority of heat-related deaths occur in homes without air conditioning. This disproportionately describes Black New Yorkers who are twice as likely to die from heat-exacerbated conditions.
Older New Yorkers with preexisting conditions – obesity, heart and respiratory illnesses – are also at higher risk for heat-related injury and death, a key consideration as the city strives to increase residents’ life expectancy.
Elected officials appreciate the risks and have issued warnings: “Stay indoors. Stay with your air conditioning,” Gov. Kathy Hochul said at the start of summer. Added Adams: “It is crucial that you plan ahead and make sure everyone is safe including your pets.”
They should add to their message a push to fund more ACs.
NewYorkCIO has announced the finalists for its 2024 New York ORBIE Awards. The New York ORBIE Awards honor chief information officers and chief information security officers who have demonstrated excellence in technology leadership. With support from Crain’s New York Business, NewYorkCIO will honor the CIOs and CISOs who are driving innovation and transforming Greater New York’s leading organizations. The 2024 New York ORBIE Awards event is scheduled for November 14 at Ziegfeld Ballroom.”
www.orbie.org/newyork/2024
Here are the subway disruptions, road closures and other commuting changes you should be aware of as you get around the city this week.
Subways * No G trains between Bedford-Nostrand Avenues in Brooklyn and Court Square in Queens until 8:30 p.m. on Aug. 11.
Commuter rail * Westbound trains skip Elmont-UBS Arena, Queens Village and Hollis stations, Monday through Thursday from 10:00 a.m. through 3:00 p.m. through August 1. * Trains bypass Locust Manor, Laurelton and Rosedale in both directions, beginning Friday at 11 p.m. to Monday at 4 a.m. through August 5.
Roads and bridges
MTA Bridges and Tunnels will partially close the Queens Midtown Tunnel at night this weekend to test out 20-plus ton steel flood doors in preparation for hurricanes and tropical storms. The Sunday, July 28 closure going into Monday, July 29 may cause delays during the morning commute. During the following times, one tube of the Queens Midtown Tunnel will be closed and one lane will be open in each direction in the remaining tube:
- Saturday, July 27 at 12:01 a.m. through 8:00 a.m.
- Sunday, July 28 at 1:00 a.m. through 9:00 a.m.
Read recent transportation stories:
Johnson & Johnson lost its bid in a federal appeals court to revive a plan to settle tens of thousands of talc cancer lawsuits by placing a subsidiary into bankruptcy.
The ruling Thursday upheld a bankruptcy judge’s dismissal last year of the Chapter 11 case of J&J subsidiary LTL Management LLC. J&J created LTL to carry into bankruptcy all health claims related to baby powder and other J&J products made with talc allegedly tainted with toxic substances. Last year, the Philadelphia-based appeals court rejected a similar bankruptcy plan.
The decision came on the eve of a Friday deadline for women with ovarian cancer and other gynecological cancers to vote on whether to support a third LTL Management bankruptcy. The company seeks to set aside $6.5 billion to resolve ovarian cancer claims as part of a total $11 billion settlement of J&J’s current and future baby powder suits.
In their opinion, the appellate panel rejected J&J’s claim that the bankruptcy judge erred in ruling that the company’s liability was not greater than $21 billion. The judges also rejected J&J’s arguments that it faced insolvency and cash-flow difficulties.
“No doubt that solvent companies, confronted by mass-tort litigation, can encounter significant financial distress that warrants bankruptcy,” Judge Thomas Ambro wrote for the panel. “When future insolvency is a realistic possibility based on meaningful evidence — not just the result of a highly speculative ‘worst-case’ scenario — a mass-tort defendant has a viable case for bankruptcy.”
J&J will seek US Supreme Court review of Thursday’s decision, said Erik Haas, worldwide vice president of litigation. The company has denied liability in the lawsuits and has maintained that its talc-based products are safe. The ruling doesn’t impact J&J’s plan to resolve all current and future ovarian claims through a third LTL Management bankruptcy, Haas said.
The appeals court also rejected an argument that the second bankruptcy was legitimate because a significant number of talc victims support the effort. That case had divided talc victims, with some backing J&J’s offer to set up a trust fund as part of an insolvency case, and others opposing it.
Some victims argued the second bankruptcy was “in the best interest of creditors.” The appeals court rejected that view.
J&J has said it is trying to round up a super-majority of plaintiffs for the third bankruptcy attempt.
Last year, the same appeals court threw out the first LTL Management bankruptcy, ruling the subsidiary essentially had a blank check from J&J. Soon after that, J&J increased its settlement offer to cancer victims to $8.9 billion. But a federal bankruptcy judge in New Jersey dismissed the case, prompting the latest appeal.
“I hope the message is loud and clear,” plaintiffs lawyer Andy Birchfield, who opposes the bankruptcy plan, said in a statement. “Now is the time for J&J to change course and act as a responsible company by offering truly reasonable compensation to its customers who have suffered serious injuries.”
A wealthy real estate mogul and hotel magnate who found himself at the center of a controversy four years ago when the city turned one of his boutique inns into a temporary homeless shelter has offloaded his Upper West Side mansion for $10 million, according to a deed that appeared in the city register Friday.
Sam Domb, a Holocaust survivor who started the Manhattan-based Empire Hotel Group after moving to New York, sold his 6-story townhouse at 318 W. 81st St. for one dollar shy of $10 million under the entity 318 Oneg Tov NY, records show.
The Domb family's hospitality portfolio includes the Pearl on West 49th Street, the Belvedere on West 48th Street and the Americana Inn on West 38th Street, along with the Lucerne at 201 W. 79th St. — the hotel that famously became a shelter for dozens of unhoused men during the height of the pandemic. The Lucerne reopened to guests in the fall of 2021 soon after the last men had moved out and after months of backlash and the threat of a lawsuit from residents of a neighborhood long considered to be a liberal bastion.
Domb, who is well-known in the Jewish community as a philanthropist who revived a handful of Orthodox synagogues on the Upper West Side, told the New York Post at the time that there were "no problems" at the hotel.
The roughly 9,000-square-foot Upper West Side mansion, which was built in the late 1800s and boasts seven bedrooms, five full bathrooms and six wood-burning fireplaces, was previously listed for $15 million in 2017 and again in 2020 for nearly $13 million. An elderly Domb — whose exact age is unclear — had lived there himself but recently moved out because he could not manage the property's many stairs, according to a source familiar with the transaction, although a listing of the home says it includes an elevator.
The new owners of the ornate townhouse between West End Avenue and Riverside Drive bought the property under a limited liability company named after the address, according to the deed.
The attorney representing the buyer, Matthew Lehrer of his own eponymous firm located in Manhattan, declined to comment. Domb could not be reached for comment, and his attorney Nicholas Kaiser of the Manhattan-based firm Cohen and Gesser did not respond to a request for comment.
Sephora just scored a huge discount on its rent for a Madison Avenue store.
The chain rated one of teens’ favorite beauty retailers last year is now paying $156 a square foot for space at 520 Madison Ave., a steep 66% markdown from its old lease that expired in June. Sephora, which is owned by LVMH and has 15 locations in Manhattan, including two on Madison, agreed to stay on the avenue at East 53rd Street for at least 18 more months.
520 Madison is a 43-story, 1 million square-foot office tower developed in 1982 by Tishman Speyer and still owned by the firm, whose $65 billion global portfolio includes Rockefeller Center and the MetLife Building. CEO Rob Speyer co-chairs the Partnership for New York City and his father Jerry chaired it twice. Tenants at 520 Madison include Carlyle Group and Jefferies.
But even real-estate royalty must grapple with market realities, which are that retailers have lots of choices of where to hang their sign. Storefront space is tight in SoHo and the Upper East Side but other shopping corridors have “ample availability,” the Real Estate Board of New York reported this week. Mark Cohen, a retail-industry consultant and former director of retail studies at Columbia Business School, said it’s harder to lease office space in buildings with an empty storefront.
“You’re seeing owners going to great lengths to prevent that,” Cohen said.
Club Monaco this year signed an extension for space at 597 Fifth Ave. at an 80% discount to the pre-pandemic rate for the area. Sephora’s bargain isn’t quite that large but does shrink its annual rent bill to $1 million a year from $3 million for its 6,400 square feet at 520 Madison. The building’s mortgage was downgraded this week by KBRA because cash flow has fallen “materially.”
“The decline is primarily attributed to a significant increase in controllable operating expenses at the property without a corresponding increase in revenue,” said KBRA, explaining “controllable” costs meant items like maintenance and payroll, which have doubled in the past 10 years.
Upstairs from Sephora, 520 Madison is occupied by Wall Streeters. Jefferies leases more than 40% of the space, at about $100 per square foot. Davidson Kempner Capital Management leases 70,000 square feet and executive recruiter Egon Zehnder International occupies 35,000 square feet.
But tenants have more options than before, with office vacancy rates at 15% in Manhattan and still creeping higher, according to Evercore ISI. At 520 Madison, Citadel moved out of 70,000 square feet last year and two floors remain vacant, KBRA said. Carlyle, the second-largest tenant with 140,000 square feet leased, is looking to sublet. Davidson Kempner will move out of 70,000 square feet and relocate to 9 W. 57th St. after its lease expires next year.
Occupancy is a lofty 96% but three percentage points lower than last year. Net cash flow fell 15% in the past year, to a bit above $50 million, and has declined by 28% in the last 10 years, KBRA said. Those worrisome figures aren’t a pressing concern because the building’s $675 million mortgage isn’t due for another 10 years, thanks to an unusually long 20-year loan written in 2014 by Bank of America and Deutsche Bank.
In a statement, a Tishman Speyer spokesperson said: “520 Madison remains in excellent financial standing with high occupancy and a 4.22% fixed-rate mortgage that will not mature until mid-2034.”
That gave room for the Speyers to swallow the Sephora markdown and keep up appearances at 520 Madison while trying to keep the rest of the place filled. Besides, if they hadn’t agreed to a 66% cut another landlord would have. Cushman & Wakefield’s quarterly retail survey doesn’t publish vacancy rates for Madison in the low 50s, but they’re 16% a block west on Fifth Avenue. The mortgage for the 525,000 square-foot Olympic Tower, at the corner of Fifth Avenue and East 51st Street, was downgraded due to high-end retailers moving out.
The upshot is retailers at prestigious Midtown addresses are paying less for the privilege. Mango is subleasing space from Ralph Lauren at an 80% markdown for its flagship U.S. store at 711 Fifth Ave. Skims Body, Kim Karashian’s shapewear company, leased Fifth Avenue space for $150 per square feet, 80% below the rate paid by prior tenant Versace. Skims agreed to share a percentage of sales with the landlord above $10 million.
It isn’t clear if Sephora’s lease-extension includes such terms. The retailer did not return a request for comment and Tishman Speyer would not comment on that.
Leases
Indoor soccer facility takes space in FiDi office tower
Address: 28 Liberty St., Manhattan
Landlord: Fosun Hive
Tenant: Socceroof
Lease size: 20,000 square feet
Asset type: Retail
Brokers: Newmark's Jordan Gosin represented the tenant. Newmark Retail's Jeffrey Roseman, Ross Kaplan and Drew Weiss represented the landlord.
Read more about the deal here.
Taproom opening in Durst Seaport building
Address: 220 Front St., Manhattan
Landlord: The Durst Organization
Tenant: Hercules Mulligan
Lease size: 800 square feet
Lease length: 10 years
Asset type: Retail
Brokers: Ripco Real Estate's Dillon Ross and Jon Paul Pirraglia represented the tenant. Lee & Associates NYC's JP Sutro, Brad Schwarz and Olivia Hwang represented the landlord, along with Karen Rose in-house.
Financings
Owner of Carroll Gardens warehouse signs loan
Address: 23-39 Fourth St., Brooklyn
Owner: George Hoffman
Lender: Webster Bank
Loan amount: $26.8 million
Asset type: Industrial
An indoor soccer facility is opening its first Manhattan location in a landmarked downtown office building.
Socceroof has inked a deal for 20,000 square feet at Fosun Hive's 28 Liberty St., Fosun announced Friday. The sports venue features multiple five-sided soccer fields and has other city locations in Sunset Park, Crown Heights and Long Island City, along with one in New Rochelle and two in Montreal. It will offer recreational leagues and lessons for children and adults.
The company will be part of the new 200,000 square feet of retail space Fosun has at the base of 28 Liberty St., which stands 60 stories tall and spans roughly 2.5 million square feet overall, according to Fosun and the commercial real estate database CoStar. Socceroof will be on the same floor as Court 16, a 13,000-square-foot pickleball and tennis club.
Newmark's Jordan Gosin represented Socceroof in the transaction. Newmark Retail's Jeffrey Roseman, Ross Kaplan and Drew Weiss represented the landlord.
Fosun, a real estate firm based in China, purchased 28 Liberty St. in 2013 for $725 million, property records show. The downtown skyscraper includes a 38,000-square-foot penthouse home to the Danny Meyer restaurant Manhatta and an Alamo Drafthouse Cinema as part of its retail space.
The overall building is 89.5% leased with estimated office asking rents of $60 to $74 per square foot, according to CoStar. Major tenants include the New York Attorney General's office and HelloFresh, CoStar says.
Insurance giant American International Group announced in 2020 that it would move its city headquarters to 325,000 square feet at 1271 Sixth Ave. and consolidate its remaining 450,000 square feet of office space in the metropolitan area between 28 Liberty St. and 30 Hudson St. in Jersey City. The firm subleased about 145,000 square feet of its space at 28 Liberty to the electronic payment firm Stripe earlier this year.
Manhattan's office market is still struggling to recover from the pandemic, and Lower Manhattan has been hurting more than Midtown and Midtown South. The neighborhood's availability rate during the second quarter of 2024 was 20.4%, and its average asking rent was $57.08 per square foot, according to data from Colliers.
In recent years, the United States has grappled with the devastating impact of gun violence, which continues to plague communities across the nation. As the founder of LIFE Camp and a dedicated advocate for peace, I have been at the forefront of the fight against violence in our society.
In light of the Surgeon General's recent declaration that gun violence is not just a crime issue but a public health crisis, it is evident that urgent action is needed to address this epidemic. Gun violence transcends mere statistics; it shatters families, traumatizes communities, and leaves a lasting scar on our society.
LIFE Camp exemplifies the power of community-driven initiatives in promoting peace and empowering individuals to break the cycle of violence. By providing mentorship, support, and resources to at-risk youth, LIFE Camp offers a beacon of hope in neighborhoods plagued by gun violence. It is not enough to view gun violence solely through the lens of law enforcement; we must also consider the underlying social determinants that contribute to its prevalence. Poverty, lack of access to education and healthcare, and systemic inequalities all play a role in perpetuating the cycle of violence.
The “Break the Cycle of Violence Act,” currently awaiting approval from Congress, proposes a national framework for violence prevention with standardized funding and resources. Inspired by this, we call for a similar initiative in New York State: a unified, fully-funded system for violence prevention. Such a system would ensure that all community programs operate with the same level of funding, resources, and infrastructure, much like the standardized operations of police, fire, and EMS departments.
This approach would enable communities across the state to address the root causes of violence effectively and implement sustainable solutions. New York City Mayor Eric Adams and Governor Kathy Hochul have shown a commitment to addressing gun violence through initiatives such as the SNUG Program and the New York City Crisis Management System, but more needs to be done to create a cohesive strategy.
While their administrations have implemented various initiatives, there is a need for a comprehensive, statewide approach that aligns with the goals of a unified violence prevention system. By fully funding and equipping these programs, we can create a cohesive network that empowers communities to combat gun violence effectively.
As we heed the Surgeon General's call to address gun violence as a public health crisis, let us rally behind initiatives that prioritize prevention, intervention, and community engagement. Together, we can build safer, healthier communities where every individual has the opportunity to thrive free from the threat of violence.
By supporting community-driven solutions and advocating for a fully-funded, statewide system modeled after the “Break the Cycle of Violence Act,” we can create a future where peace prevails over violence and hope triumphs over despair. Let us urge Mayor Adams, Governor Hochul and our state legislators to take this vital step towards a unified and effective system to prevent violence and save lives across New York State.
Erica Ford is the founder and CEO of LIFE Camp, a Jamaica, Queens-based non-profit working to reduce gun violence by creating partnership with community stakeholders.
In 2021 Winson Wong had a dilemma. Within six months of trying to develop a hyperlocal network of composting services for restaurants, Wong and his partners, Sierra Alea and Ryan Freed, had come to the realization that the effort was too logistically and financially daunting. But they had a list of clients interested in paying them to upcycle their food waste.
Thus began their experimentation with novel ways to break down food scraps while providing a product to would-be customers. Converting the scraps into energy sources was one idea. Insect farming for sustenance was another — a prospect the team felt the city’s restaurant world wasn’t quite ready to embrace. The most feasible and exciting idea turned out to be growing mushrooms. The concept became the basis for Afterlife Ag, a Queens-based startup that upcycles food scraps into gourmet mushrooms.
“We're not just a farmer; we're not just a waste-management company,” said Wong, whose family owned a food-distribution business in Hong Kong and who for three years worked with startups at multinational food manufacturer Mars Inc. “We're essentially providing two different services for our clients. Both are equally important.”
As an added bonus, the U.S. is in the midst of a ’shroom boom, with a recent surge of new mushroom coffees, teas, supplements, snacks, grow-your-own kits and simply increased interest from adventurous eaters and chefs. To date the young startup has raised just over $3 million; its investors include Clear Current Capital, Siddhi Capital and Brooklyn Bridge Ventures.
“For me, the excitement was really around helping to solve the waste issue in New York,” said Alea, who was struck by the hulking piles of trash bags throughout the city when she moved to New York from Berkeley, California, in 2014. “But mushrooms are a really versatile product. They’re the base for medicines. We can make tinctures from them. We can dry them. We can sell them fresh, which is what we’re doing now. There's a lot that can be done with them, and that's really exciting from a business perspective.”
Tucked within an industrial building in Ridgewood is the startup’s 3,000-square-foot farm space, where the company grows up to 800 pounds of mushrooms per a week for some 40 clients.
The process begins with Afterlife Ag picking up 32-gallon bins packed with vegetable peels, egg shells and other back-of-house food waste — never half-eaten customer leftovers — from restaurants, hotels, food distributors and other businesses. Staff schlep the hulking bins into an electric vehicle and take the waste back to the farm. The scraps are then ground, chopped, shredded and mixed up together. Woody materials are added because the blend can get soggy. Afterlife Ag has a proprietary formula for a mixture to grow the mushrooms because the nutrient makeup of the food waste tends to vary.
From there the mixture is sterilized, using heat and pressure, and is divided into blocks that are used to grow a rainbow of pink oyster, chestnut and black king mushrooms, among other types. It takes around two weeks for the mycelium to colonize and then, depending on the variety, two more weeks for the mushrooms to grow.
The process concludes with businesses receiving some 20 pounds of fresh mushrooms a week — reborn from waste that would have otherwise rotted in a landfill and emitted planet-warming gasses.
Afterlife Ag sells the fungi wholesale for between $6 and $12 per pound. Wong said the company earned six figures in revenue in 2023, and his team aims to get that number closer to seven figures by the close of 2024. One key way to do that is with more space. The company is in the midst of expanding its farm, which Wong says will enable Afterlife Ag to produce 3,000 pounds of mushrooms per week, and he aims to push that figure to 10,000 pounds by next year. At the moment the startup is focused on working directly with businesses and doesn't have immediate plans to sell to consumers in grocery stores.
The currently limited space at the farm means Afterlife Ag has to strike a balance among fast growth rates, high yields and popularity among the varieties it cultivates. But the company has also sought to introduce buyers to unique options.
Chestnut mushrooms, for example, are rare among growers, but Wong said that after the chefs the firm works with experimented with samples, interest in the variety has steadily grown. Similarly, pink oyster mushrooms are less common because they have a shorter shelf life than the more available blue oyster variety, but Afterlife Ag’s business model reduces that concern.
“We grow pink oysters because I know restaurants love them because they're so unique and pretty,” added Wong. “That’s a species where we’re actively wanting to own the market, so starting to own our own species is really important.”
As breakdancing gets its moment in the world’s spotlight debuting as an Olympic sport in Paris, a hospital in the Bronx is flashing back to its hardscrabble origins with a new ad.
“Spot it Early,” Montefiore Einstein’s message about early cancer detection, has a parallel in the emerging art form and its performers—early detection, in sports or with cancer, leads to better outcomes. Montefiore Einstein touts a reputation as a top cancer-care hospital, calling itself “the official sponsor of spotting it early.”
The ad from agency Mirimar is set to make its broadcast debut during NBC’s live coverage of today’s Olympic opening ceremony and again in NBC’s primetime broadcast, with 60- and 30-second versions in rotation throughout the 2024 Games.
Flashing back to the late 1970s and early 1980s, the spot tells the story of how a boy named Reece saw his South Bronx neighborhood transformed through breaking, and how as a grown-up today, he can continue to influence the sport by spotting young talent. The extended online version is shown here.
The connection between Montefiore and breakdancing was fairly straightforward — both proudly hail from the New York City borough of the Bronx. But it was insight around the long journey athletes make to the Olympics — and the related value of spotting their talent early — that connected the message, according to John McKelvey, co-founder and chief creative officer of Mirimar.
“Breakdancing’s debut became the perfect unifier as it will feature for the first time at this year's Olympics, and [with] breakdancing and Montefiore Einstein both beginning in the Bronx, we knew Montefiore Einstein had an authentic story to tell,” McKelvey said in emailed remarks. “We were able to make this careful throughline with two things that people don’t often put together—talent and cancer.”
The ad was directed by Seb Edwards of Park Pictures and shot by cinematographer Adam Arkapaw. It is narrated by rapper Rahiem of Grandmaster Flash and the Furious Five. Bronx hip-hop icon Grandmaster Caz plays the talent show host. Graffiti was provided by the fabled artist KEO. Choreographer and cultural advisor Nemesis brought together actual breakdancing crews, not actors, including the young dancer shown at the end of the film, Carmarry “Pep-C” Hall.
The connection between Montefiore and breakdancing was fairly straightforward — both proudly hail from the New York City borough of the Bronx. But it was insight around the long journey athletes make to the Olympics — and the related value of spotting their talent early —that connected the message, according to John McKelvey, co-founder and chief creative officer of Mirimar.
“Breakdancing’s debut became the perfect unifier as it will feature for the first time at this year's Olympics, and [with] breakdancing and Montefiore Einstein both beginning in the Bronx, we knew Montefiore Einstein had an authentic story to tell,” McKelvey said in emailed remarks. “We were able to make this careful throughline with two things that people don’t often put together — talent and cancer.”
The ad was directed by Seb Edwards of Park Pictures and shot by cinematographer Adam Arkapaw. It is narrated by rapper Rahiem of Grandmaster Flash and the Furious Five. Bronx hip-hop icon Grandmaster Caz plays the talent show host. Graffiti was provided by the fabled artist KEO. Choreographer and cultural advisor Nemesis brought together actual breakdancing crews, not actors, including the young dancer shown at the end of the film, Carmarry “Pep-C” Hall.
The connection between Montefiore and breakdancing was fairly straightforward — both proudly hail from the New York City borough of the Bronx. But it was insight around the long journey athletes make to the Olympics — and the related value of spotting their talent early — that connected the message, according to John McKelvey, co-founder and chief creative officer of Mirimar.
“Breakdancing’s debut became the perfect unifier as it will feature for the first time at this year's Olympics, and [with] breakdancing and Montefiore Einstein both beginning in the Bronx, we knew Montefiore Einstein had an authentic story to tell,” McKelvey said in emailed remarks. “We were able to make this careful throughline with two things that people don’t often put together — talent and cancer.”
The ad was directed by Seb Edwards of Park Pictures and shot by cinematographer Adam Arkapaw. It is narrated by rapper Rahiem of Grandmaster Flash and the Furious Five. Bronx hip-hop icon Grandmaster Caz plays the talent show host. Graffiti was provided by the fabled artist KEO. Choreographer and cultural advisor Nemesis brought together actual breakdancing crews, not actors, including the young dancer shown at the end of the film, Carmarry “Pep-C” Hall.
Music featured in the film includes “New Rap Language” by Spoonie Gee & The Treacherous Three, “Dance” by ESG, “Rockin’ It” by The Fearless Four, and “I Shall Wear a Crown” by Pastor T. L. Barrett.
In addition to the ad, the integrated campaign includes digital, social, a campaign microsite, and a large out-of-home footprint including massive hand-painted wallscapes in Manhattan and the Bronx. The Manhattan art on Eighth Avenue is one of the largest canvases in New York, according to Miramar; its art features breaker Alexis Holguin (aka Thriller), who is shown in the film.
Montefiore Einstein will also run a full-page ad in the Sunday New York Times, as well as print ads in other newspapers and magazines.
“This isn’t just a campaign; it’s about inspiring the world with a story of resilience, triumph and spotting things early, and proving that if you do, whether it’s in your health or a sport, no victory is out of reach,” said McKelvey.
Montefiore Einstein said it would further support the campaign by helping to fund a Bronx breakdancing school in cooperation with the dance house Nemesis.
This article originally appeared in Ad Age.
Venture capital investment in New York startups is on the rise and will outpace the uncharacteristically low levels of 2023 if it remains on the current trajectory.
That's according to the latest monthly economic snapshot from the New York City Economic Development Corp., which traces metrics relating to the health of the labor market, business activity, tourism and more. NYCEDC uses PitchBook data to track VC activity.
VC funding in New York hit $7.72 billion in Q2, a 43% increase from the $5.4 billion raised in Q1. The year-to-date total is now $13.1 billion, up 74% from the same point in 2023.
The rebound is being largely led by deals in SaaS, or software as a service cloud computing, artificial intelligence, machine learning and other emerging tech subsectors, the report said.
Many early-stage startups in New York struggled to raise money in late 2022 and 2023. The stagnant IPO market was partly to blame. Stubbornly high interest rates, an unpredictable public market and an aggressive regulatory environment stifled activity. The hesitancy to go public led to a trickle-down effect on the local tech ecosystem as a lack of IPOs or mergers limited the flow of capital, and highly skilled tech employees who were tied up in equity couldn't move forward in their careers or start new companies.
Local venture capitalists have insisted the slowdown wasn't cause for alarm but rather a return to earth from the sky-high dealmaking and subsequent IPOs that defined 2020 and 2021.
There are now signs the frozen IPO market is thawing. There have been several recent high-profile success stories, such as San Francisco-based Reddit, whose shares jumped 48% upon its debut in March. The company’s revenue also climbed by 48% in the first quarter, according to Reddit’s inaugural earnings report filed in May. It's now trading at about $62.
The NYCEDC report goes beyond just tracking venture capital activity. Over the past year, New York saw a net decrease of 840 in the number of businesses operating in the city. The local unemployment rate overall stayed steady at 4.8%, while the city's Black unemployment rate declined for the fifth consecutive quarter to 7.3%.
The report also said citywide office vacancy rates decreased for the first time since 2018, now at 14.8%. "Though still elevated compared to pre-pandemic levels, this decline further reinforces that vacancy has already or will soon peak as the commercial real estate market recovers," it read.
Crain's Amanda Glodowski contributed.
WMCHealth broke ground Wednesday on a $220 million tower at Westchester Medical Center in Valhalla as part of an ongoing expansion and a shift to all-private patient rooms.
When completed the 162,000 square foot, five-story tower will host 128 private rooms for patients, which will be convertible into intensive care units. All trauma intensive care services will be moved to the new building, which will also be home to cardiac, neuroscience, oncology, and surgical units. The expansion is intended to make more room for existing units in other buildings, like pediatric emergency medicine and women’s health services.
WMCHealth, which brought in $2.7 billion in revenue last year, according to spokesman Andrew LaGuardia, will be opening its new cardiac unit at a time when the business of heart disease is booming. Hospital systems across the country are investing more in cardiovascular programs as poor heart health remains the number one cause of death in the country, according to the American Heart Association. Since the end of last year, Northwell Health has invested more than $600 million into its cardiac services. And earlier this month, NYU Langone launched an $11 million expansion of an ambulatory care hub for children with congenital heart disease.
The project received $195 million in tax-exempt bond financing from the Westchester County Local Development Corporation, one of the largest projects funded by the body, WMCHealth said. The county expects to reap more than $3.5 million in economic benefits from the project, which it estimates will create 770 construction jobs and 127 new permanent jobs.
The tower, expected to be completed in 2026, is the second major addition to the Valhalla-based hospital complex in recent years. In 2019, WMCHealth cut the ribbon on a $230-million Ambulatory Care Pavilion, which boasts eight stories of modern patient and procedure rooms.
Northwell Health, New York’s largest health care provider, is raising the curtain on a film studio to elevate its visibility and get more credit for its behind-the-scenes work. The move into the spotlight could also unlock valuable state tax breaks for the mega system.
The new venture, dubbed Northwell Studios, will develop and co-produce scripted and unscripted films highlighting the system’s clinical offerings, latest tech and some of its staff, the health care giant announced Wednesday. Northwell already holds a development deal with Dumbo-based CreativeChaos, a documentary film and television company, on five media projects now in the works.
Under the new studio model, Northwell will not pay for product placement; instead it will offer its intellectual property and access to facilities to show runners and distributors who will commercialize it, according Chief Marketing Officer Ramon Soto, who will lead the studio. The health care system, which brought in $16.8 billion in revenue last year, has already played a part in the growing market for medical media content, serving as the backdrop for five documentaries since 2017, including HBO’s “One South: Portrait of a Psych Unit,” which was filmed at Zucker Hillside Hospital in Queens. Northwell’s second project with Netflix, “Emergency NYC,” had millions of hours of viewership in its first months on the platform.
“If you were to…convert that into 30-second ads, I could never afford that much branding and that much brand exposure,” Soto said.
Northwell has not disclosed the terms of the arrangement with CreativeChaos or the value of any contracts with them. Ilan Arboleda, co-founder and CEO of CreativeChaos, said a non-disclosure agreement prevented him from discussing the deal’s financials. It is unclear what the studio’s budget will be, how it will be staffed, or how it is expected to impact Northwell’s bottom line.
The studio will be wholly owned by Northwell. Its projects will star some of Northwell’s 85,000 employees along with consenting patients. “We’re trying to stay in the upper echelon,” Arboleda said. “You’re not going to see some, for lack of a better term, cheap reality programing from the stuff we’re developing.”
Roll credits
With the new studio billing, Northwell will be able to receive producer credits, said spokesman Matthew Libassi. The company was not credited as a producer when it provided access to film crews in the past, though it had staff present on set and retained some editorial rights, he said. The deal with CreativeChaos is not exclusive and Northwell also plans to work with other production companies.
The new studio moniker could also give the hospital system access to New York’s lucrative film tax credit, which distributes $700 million a year and covers a quarter of eligible production costs. That credit does not cover unscripted content, like documentaries. But one of the five films CreativeChaos is working on with Northwell will be eligible, Arboleda told Crain’s.
“We plan to definitely take full advantage of the incentive. We love the program,” he said.
John Kaehny, executive director of government watchdog Reinvent Albany, said the new endeavor could conflict with Northwell’s mission to prioritize health care. With a sizable chunk of Northwell's revenue coming from government sources, Kaehny questioned what firewalls are in place to ensure taxpayer money is not subsidizing a media company.
“It seems completely incompatible with the mission of any health care entity to be also involved in producing, financing, distributing, or otherwise fostering entertainment content. It’s mindboggling and it’s disconcerting,” Kaehny added.
Asked about the potential for conflicts of interest with Northwell’s health care mission, Soto said the studio would be subject to “a fairly rigorous operating review.”
“Everything we do is signed off by senior leadership,” he said. “Ultimately the person who has final say on a project is [Northwell CEO] Michael Dowling.”
DRUG WARNING: The New York City Department of Health and Mental Hygiene has identified the powerful synthetic opioid, carfentanil, and the non-opioid anesthetic, medetomidine, in the city’s drug supply. In a warning issued Thursday, the city is urging health care providers to contact the Health Department if they observe atypical overdoses. Carfentanil has been linked to at least seven unintentional overdose deaths in the first half of 2024, according to the department’s provisional data.
WORKFORCE TRAINING: More than two dozen health care facilities across the state are set to receive $22.5 million in state funding to help train their health care workforce, Gov. Kathy Hochul announced Thursday. The funding, part of a $10 billion multi-year workforce initiative, will support training for nurses, physician assistants, home health aides, community health workers and other direct support professionals, according to the governor’s office. The awards will flow to 13 hospitals and 15 nursing homes and amount to up to $1 million a year for two years.
9/11 HEALTH IMPACTS: Federal lawmakers introduced new bipartisan legislation on Thursday that would extend enrollment for the World Trade Center Health program, which covers medical care for first responders and civilians who developed illnesses related to the 9/11 attacks. The bill seeks $3 billion to cover a funding gap that could halt enrollment by 2027, as well as correct a funding formula that will keep the program up and running through 2090. Sens. Chuck Schumer and Kirsten Gillibrand and U.S. Representatives Representatives Andrew Garbarino, Anthony D’Esposito, and Dan Goldman introduced the legislation.
CORRECTION: The glance in yesterday's issue about the city ending vending machine services has been updated to reflect that the four existing machines are still functional.
A SoHo-based biotech that develops tech-based storage units that freeze and digitally track eggs and sperm used in fertility treatments raised $28 million this week to expand to additional clinics, the firm said Wednesday.
TMRW Life Sciences, founded in 2018, will use its Series D funding to grow the number of clinics that use its automated storage units and encrypted digital platform to safely store frozen eggs, sperm and embryos for in-vitro fertilization. The units provide freezer storage and link patients’ eggs and sperm to their electronic medical records to safeguard against mix-ups or damaged embryos, consequences some clinics encounter when storing thousands of patients' eggs and sperm.
More fertility clinics are looking for safe and reliable ways to store frozen eggs and embryos amid high-profile mistakes by fertility clinics and legal decisions that have outlawed the destruction of embryos. An Alabama state Supreme Court ruled in February that an embryo is considered a human life – a first-of-its-kind decision that made it illegal to discard embryos and raised the stakes for clinics to safeguard fertilized eggs.
Although the Alabama decision itself did not change laws regulating embryo preservation nationwide, it raised serious concerns about whether the 1 million embryos in storage across the country were in jeopardy. TMRW Life Sciences received calls from clinics in states hostile to abortion to inquire about storing their patients’ embryos in the company’s offsite repository in New York, said Louis Villalba, chief executive of the firm.
The recent funding round was led by the San Francisco-based venture capital firm 5AM Ventures and included participation from actress and comedian Amy Schumer. Investors including FIOS Venture Holdings, DF Investment Partners, Transformation Capital, Life Sciences Innovation Fund and Casdin Capital also participated in the funding round.
The funding comes as women’s health companies in New York have continued to attract venture capital attention, cementing the city as a hub for firms innovating fertility and reproductive health solutions. New York-based women’s health tech firms raised $256 million in 2023, accounting for half of all fundraising in the U.S., according to an analysis from Deloitte.
TMRW Life Sciences has focused on automating what it says are antiquated procedures for storing fertilized eggs. Typically, a patient freezes embryos for months at a time so they do not have to go through additional hormonal treatments and produce more eggs for each IVF cycle. Clinics store these materials, but few have the digital technology to track and trace patients’ specimens.
Egg freezing has increased at a rapid rate since 2010 because of scientific advancements in preservation, but the fertility industry’s storage and tracking systems have not kept up with the pace, Villalba said. The firm emerged to create a digital repository to make sure clinics can keep track of patients’ embryos and protect against damage.
TMRW Life Sciences has two fertility storage machines, one that can preserve biological materials for up to 3,500 patients at a time and another that can fit in standard fertility clinics and accommodate up to 1,100 patients at a time, according to Villalba. The smaller unit is approved by the U.S. Food and Drug Administration.
TMRW Life Sciences provides its embryo storage technology to more than 60 fertility clinics and serves roughly 39,000 patients in the U.S. and the U.K. – a number it expects to continue to grow. The biotech expanded its technology across the pond at the end of last year, and is seeking a partner to further its international expansion in 2025, Villalba said.
Mayor Eric Adams and Council Speaker Adrienne Adams have maintained a publicly cordial relationship even as they battled over budget cuts and butted heads on legislation. But that decorum could dissolve in the coming months, as lawmakers prepare to campaign against a set of questions the mayor is putting before voters in November that could rewrite the city’s governing document to curb the City Council’s power.
“It is a dangerous attempt to shift power away from the people represented by the City Council to one single individual,” Speaker Adams said during a rally on Thursday, outside the Brooklyn Public Library’s central branch. “Do you want a king?”
She made the remarks minutes before the mayor’s handpicked 13-member Charter Revision Commission met inside to approve the proposed changes, which mirror Mayor Adams’ own grievances against the City Council by slowing the legislative process when it considers bills that affect public safety, and tightening rules about how the council studies the fiscal impact of new laws.
Speaker Adams described the charter commission’s ballot measures as an “attack on democracy,” a claim that was echoed by the other politicians and progressive groups that spoke out against the charter rewrite. The allusion to former President Donald Trump was intentional.
A City Council staffer who spoke on the condition of anonymity argued that the mayor had “laid the groundwork for people to compare him to Trump." (City Hall declined to comment on the provocative comparisons, and skeptics will note that none of the proposed revisions would radically change how the council does its work.)
Council members were clearly conscious of the charter revisions’ unusual placement on a presidential election-year ballot — a change from other recent votes on City Charter changes, which took place during low-turnout, odd-numbered election years and passed easily.
The most recent charter amendments in 2019 passed with about three-quarters of the vote, including the measure that instituted ranked-choice voting. This year, the presidential turnout will alter the landscape.
Adams kickstarted this year’s fast-moving effort just two months ago, in what lawmakers saw as a clear maneuver to block the City Council from adding its own November ballot measure, which would increase its oversight of mayoral appointments.
To persuade New Yorkers to reject the proposals, however, council leaders and their allies may need to mount a paid campaign.
Details of the potential opposition campaign remained unclear on Thursday. But Gale Brewer, a veteran Manhattan City Councilwoman, predicted that “the money will come.”
“And I think we can do it in a very short time period,” Brewer added. (Any campaign could not be paid for by the City Council itself, since it would amount to illegal electioneering; instead, it would need to be funded by outside groups or through elected officials' campaign accounts.)
In a last-minute twist on Thursday, the Charter Revision Commission revealed right before its meeting that it had removed a few of the more controversial measures announced earlier this week. A proposal forcing the council to wait about three months before voting on bills that affect the NYPD, Fire Department or Corrections Department has been shortened to require just a 30-day window. It no longer tasks those departments with filing their own “public safety impact statements” on proposed laws.
Carlo Scissura, the commission’s chair and head of the New York Building Congress, said Thursday that the changes came in response to feedback from the public “and others” in the short time since the proposals were released on Tuesday.
But the City Council showed no immediate signs of being mollified by the changes. Mayor Adams, who has consistently defended the charter rewrite as a sincere effort at improving government responsiveness, praised the final ballot measures as “thoughtful.”
Besides the contested items that affect the City Council, the commission also approved a few less controversial questions that would clarify the Sanitation Department’s street-cleaning authority, enshrine a new City Hall position focused on boosting minority- and women-owned businesses, ease permitting for film shoots and tweak how the city plans for costly capital projects.
Dominated by friends and allies of the mayor, the Charter Revision Commission held a dozen public hearings — many of which were sparsely attended. Although the mayor has come under fire from legislators, he got nothing but praise on Thursday from members of the commission he convened.
"I want to take the time and thank a man that really cares about the city, our very own Mayor Eric Adams,” commissioner Jackie Rowe-Adams, an anti-gun violence advocate, said at the start of the meeting. “He heard the voice of the people.”
Another one bites the dust.
Astoria's Neptune Diner is closing for good on Sunday after four decades in business.
The popular eatery on Astoria Boulevard will join the ghosts of New York institutions past after the property was recently sold to new owners, a member of the family-run diner, which leases the building, confirmed to Crain's.
"The neighborhood is coming in, taking pictures, having one last meal," said Sarando Katsihtis, whose father, Peter Katsihtis, has owned the diner with Peter's brother, George, for about 40 years.
The Katsihtis family had managed to stave off closure at least twice before: once in 2015, when rumors circulated online that the roughly, 3,200-square-foot restaurant would shutter amid a scourge of diner closures in the city that were chronicled in Crain's at the time; and again, in 2022, when a nearby rezoning application threatened its existence. Neptune will now officially serve its last meal; its menu runs the gamut from lamb chops to Belgian waffles.
A manager who answered the phone at the property, located at 3105 Astoria Blvd N., Thursday, and who identified himself only as Chris M., said the family had been about to renew their lease, but the property is in contract to be sold.
"Like everybody, I'm upset," he said.
An attorney for the seller, Nick Tsoromokos of the Astoria-based law firm Tsoromokos & Papadopoulos, told Crain's Thursday that his client — the Thomas Anagnostopoulos Family Trust, according to city records — is expected to close on the sale of the building within the next 45 days. He declined to name who is purchasing the building, the price paid or what the new owner has in store for the property, between 31st Street and 32nd streets. Tsoromokos's client, the Anagnostopoulos family, bought the building in 2018 for $10.3 million, records show.
A permit the family filed to the Department of Buildings in 2022, however, called for a 6-story, mixed-use building with 24 dwelling units and either commercial space or a community facility on the ground floor.
The Katsihtis family still runs two other Neptune Diner locations in the city — one in Crown Heights and another in Bayside, Queens. With the closure of the Astoria location, a third is now in the works for Nassau County on Long Island, according to the younger Katsihtis, who declined to provide more details.
Congestion pricing supporters filed a pair of lawsuits Thursday in Manhattan Supreme Court against Governor Kathy Hochul and state agencies including the Department of Transportation, claiming Hochul’s reversal on the tolls violates state law.
One lawsuit filed by civic group The City Club of New York, along with two Hell’s Kitchen residents, argues that Hochul lacks the legal authority to prevent the tolling program from taking effect under the 2019 state law that originally authorized its formation. Attorney Andrew Celli, Jr., who is representing the City Club, said Hochul is stalling the program through the “bureaucratic trick” of refusing to sign a document that should have been an administrative formality for the tolls to take effect.
“This is a case about democracy and executive overreach,” the lawsuit states. “The mandate to implement congestion pricing rests exclusively with the [MTA’s Triborough Bridge and Tunnel Authority]; the Governor has no say in the matter. That is the law.”
A second lawsuit filed by commuter advocates the Riders Alliance, the New York City Environmental Justice Alliance and the Sierra Club argues that Hochul’s decision disregards the Climate Leadership and Community Protection Act, a 2019 law that cites congestion pricing as a means of New York reducing its greenhouse gas emissions.
The lawsuit also contends that the indefinite pause violates the “green amendment” voters approved in 2021 to ensure New Yorkers have a state constitutional right to “clean air and water, and a healthful environment.” Ironically, lawsuits challenging the congestion pricing tolls have sought to use the green amendment to argue that the program will actually exacerbate air pollution in some areas by encouraging new traffic patterns.
“This really sets up what does this constitutional right protect, and again, if it doesn’t protect [congestion pricing] then it’s hard to know exactly what it would protect,” said Dror Ladin, an attorney representing advocates in the lawsuit.
Hochul spokeswoman Maggie Halley bashed the legal battles in a defiant statement that conflates the new lawsuits, which want Hochul to immediately implement the tolls, with several others filed by detractors who aim to prevent congestion pricing altogether.
“Get in line,” said Halley. “There are now 11 separate congestion pricing lawsuits filed by groups trying to weaponize the judicial system to score political points, but Governor Hochul remains focused on what matters: funding transit, reducing congestion, and protecting working New Yorkers.”
Congestion pricing would charge most motorists $15 to enter Manhattan south of 60th Street and is intended to improve the environment by taking pollution-belching cars off the road while raising some $15 billion for upgrades to the MTA’s subway, bus and commuter rail networks.
The MTA planned to begin charging drivers on June 30, but Hochul abruptly halted the plan on June 5. The new tolls, she said at the time, risked the city’s economic growth and would financially burden businesses and residents grappling with inflation.
Without a congestion pricing revenue replacement, the MTA has said it is preparing to scrap more than $16 billion worth of upgrades to the region’s mass transit and instead focus on essential upkeep to keep the systems functional.
The MTA’s board reluctantly voted on June 26 to pause the implementation of congestion pricing, formalizing Hochul’s postponement. The authority, which is also named in both lawsuits, declined to respond to the legal arguments.
Southwest Airlines will begin offering assigned seats, ditching the free-for-all policy that has been a defining feature of the carrier for more than half a century.
The airline announced the seismic change to its business model Thursday alongside a new premium-class option and plans for redeye flights — shifts the company sees boosting sales and enhancing its appeal. While Southwest said earlier this year that it was reconsidering the seating policy, it’s now facing heightened pressure to revamp underperforming operations from activist investor Elliott Investment Management.
The strains on Southwest’s business were underscored in the company’s earnings report, also released Thursday. While profit last quarter beat expectations, its guidance for revenue and costs in the current period was worse than Wall Street’s estimates.
“We are taking urgent and deliberate steps to mitigate near-term revenue challenges and implement longer-term transformational initiatives,” Chief Executive Bob Jordan said in a statement. He pointed to the seating changes as pieces of “an ongoing and comprehensive upgrade” to passenger accommodations.
Its shares fell 4% as of 6:52 a.m. in New York following the release of financial results.
The airline has struggled this year with slowing growth, fewer-than-expected aircraft deliveries from Boeing and a series of flight-safety incidents that triggered a Federal Aviation Administration review of the carrier this week. Southwest’s stock has declined modestly this year even as the broader market has gained.
The latest steps represent a strategic shift for the carrier, which has steadfastly maintained open seating while other airlines raked in revenue by charging extra for more-desirable seats. That unfulfilled opportunity is a major tenet of Elliott’s campaign — that Southwest has refused to modernize its business to appeal to today’s travelers.
Adoption of premium seating could open the door for the carrier — which has long appealed primarily to leisure travelers — to potentially offer business- and first-class sections in the future.
Southwest still won’t charge for checked bags. The “bags fly free” policy has been a focal point of Southwest promotions and advertisements, and some analysts have speculated charging for bags could cost the airline customers. It’s the only domestic carrier that doesn’t impose fees to check two.
Southwest will begin offering assigned seats and premium seating with more legroom next year. It will start flying overnight, cross-country routes on Feb. 13. Those flights are already on sale from Las Vegas, Los Angeles and Phoenix to Baltimore/Washington International Thurgood Marshall Airport; Las Vegas to Orlando; and Los Angeles to Nashville.
Southwest didn’t provide specifics on potential revenue from the changes, which also include a redesign of its boarding process. All seats will be assigned, and about one-third will be premium class, but there won’t be a separate cabin for premium offerings. Changes to the onboard layout will require FAA approval.
The airline said it opted to adopt the updates after its own research found that 80% of current customers and 86% of potential passengers prefer an assigned seat, particularly during the larger number of longer flights operated by Southwest now.
Southwest Chief Commercial Officer Ryan Green will be moved to a new position to oversee the transformation and other commercial initiatives.
The carrier has studied various seating options in the past, but always rejected a shift to assigned spots, saying passengers didn’t support such a move.
While Southwest has long stood by some of its central policies, it hasn’t been entirely resistant to change. It began routes to nearby international destinations and, more recently, added flights to Hawaii. The airline previously revamped its boarding system, offered early boarding options at an additional cost and developed a corporate booking tool to win more business travelers.
Southwest said in April that it had begun evaluating premium products and others changes, well before Elliott disclosed a $1.9 billion stake last month. But until Thursday, the airline said it wouldn’t disclose any details until an investor meeting slated for September.
Elliott wants to oust Jordan and Chairman Gary Kelly for poor execution and a “stubborn unwillingness to evolve the company’s strategy.” They are “not up to the task of modernizing Southwest,” the activist has said.
Southwest earlier this month named a veteran airline industry executive to its board to help address other concerns raised by Elliott. The carrier also adopted a “poison pill” shareholder rights plan to discourage the activist from gaining a larger share.
In addition to policy changes, Southwest said Thursday that it earned an adjusted profit of 58 cents a share in the second quarter. That topped the 51-cent average of analyst estimates compiled by Bloomberg. Operating revenue of $7.4 billion also beat expectations.
Still, the carrier acknowledged challenges from an industrywide capacity glut. Domestic-focused US airlines have had to slash fares to fill planes after the industry added too much capacity in anticipation of a record summer travel season. The discounting has cut into revenue and profit expectations at even the largest US airlines.
Southwest said it’s made changes to better match the supply of seats with demand in the remaining summer, fall and early winter schedules. But fare management issues that reduced unit revenue in the first three months will extend into this quarter.
The recent performance “fell short of what we believe we are capable of delivering,” Jordan said.
Its outlook for key sales and cost measures were worse than Wall Street estimates. Third-quarter revenue for each seat flown a mile, a gauge of demand and fares, will be flat to down 2% year over year, the airline said, while analysts were expecting growth of 4.9%. Non-fuel costs on the same basis will increase as much as 13%, compared with analysts’ estimates for a 6.8% rise.
The New York-based parent of Flagstar Bank has sold off its mortgage servicing business.
Flagstar, long a mortgage heavyweight and headquartered in Troy prior to being acquired by New York Community Bank in late 2022, announced Thursday morning that it had sold its mortgage servicing and third-party mortgage origination business to Mr. Cooper Group in a deal valued at approximately $1.4 billion.
The deal marks the second sale of mortgage loans executed by NYCB in less than a week as executives there say they seek to rebalance the bank and focus on core businesses following significant turmoil in the early part of this year.
The price in the Mr. Cooper deal represents a "premium" based on Flagstar's mortgage business being "well respected throughout the industry," NYCB Chief Executive Joseph Otting said in the release.
"While the mortgage servicing business has made significant contributions to the Bank, we also recognize the inherent financial and operational risk in a volatile interest rate environment, along with increased regulatory oversight for such businesses," Otting said. "We are focused on transforming the Bank into a leading, relationship-focused regional bank. Consistent with that strategy, we will continue to provide residential mortgage products to the Bank's retail and private wealth customers."
During a call with investors Thursday morning, Otting told analysts that the bank has a longstanding relationship with Mr. Cooper and views the deal as "a good and easy transition of our important assets into the company.”
On July 22, NYCB announced the completed sale of approximately $5.9 billion in mortgage warehouse loans to JPMorgan Chase, a deal that "adds a significant amount of liquidity" to the bank, according to Otting.
“Both of these sales are important milestones for us as we look to simplify our business model and strengthen our balance sheet," Otting told analysts. "Collectively, these two transactions we feel bolster our liquidity and increase our capital ratios."
It was not immediately clear how many employees will be affected by the Mr. Cooper deal. Flagstar reported laying off 60 employees in Jackson in mid-June, but additional details on those layoffs were not immediately available Thursday morning.
"This was not a decision we took lightly and I want to thank our teammates in mortgage servicing and third-party mortgage originations and all of the support teams who deliver high-quality service day-in and day-out," Otting said in the release. "Mr. Cooper is a major player in the mortgage origination and servicing business. It was important to us that we commit to a buyer with strong mortgage expertise and reputation, and a shared commitment to customer service excellence and employee values."
Mr. Cooper, based in the Dallas area, last year also acquired the remaining business of Ann Arbor-based mortgage lender Home Point Financial.
“We have the operational capacity to onboard Flagstar’s customers with a smooth and positive experience, which will be our top priority. We also look forward to welcoming Flagstar team members to the Mr. Cooper family," Mr. Cooper Chairman and CEO Jay Bray said in the release Thursday. "We have long respected Flagstar as a mortgage servicer, and we feel very closely aligned with their cultural values.”
A bank on the rebound
The deal to sell mortgage servicing rights to Mr. Cooper coincided with NYCB announcing its second quarter earnings. NYCB has in recent months sought to overhaul its leadership team and board ranks following a near collapse in early 2024 as investors and clients worried about increasing provisions for credit losses.
The earnings report on Thursday showed losses last quarter were about $323 million compared to a $327 million loss in the first quarter.
Still, the bank increased its reserves for potentially bad loans from $315 million at the end of the first quarter to $390 million, largely due to "office loans, and the continuing impact of market conditions on the multi-family portfolio as higher interest rates and inflationary impacts persist," according to the earnings report.
Investors, however, were nonplussed as NYCB stock was trading down more than 10% in early morning market activity.
This article originally appeared in Crain's Detroit Business.
The state Department of Health has approved Beth Israel’s closure plan with some conditions.
The state says Mount Sinai must operate a new urgent care center nearby the site of the Lower East Side hospital for at least three months and develop an agreement with New York City Health + Hospitals to invest in an expansion of Bellevue Hospital’s emergency room and psychiatric emergency department, according to Erin Clary, a spokeswoman for the Health Department.
The health system has pushed to close Beth Israel for the last 10 months because of financial challenges it says are too vast to overcome. The hospital has reportedly faced cash flow deficits that left it with just $29 million in cash reserves by the end of 2023. The hospital loses $18 million per month, according to the submitted closure plan.
The state approval, first reported by Politico, comes shortly after Mount Sinai was forced to stay open past their July 12 deadline, awaiting the green light. The hospital still faces an ongoing lawsuit from community members blocking the closure that must play out in court.
Mount Sinai has now asked the state court for an expedited review of that lawsuit so it can officially close Beth Israel, according to Loren Riegelhaupt, an outside communications specialist who represents the health system. There’s no new closure date set yet.
This is a breaking news story and will be updated.
Even after paying $195 million for retail space on North Sixth Street in Williamsburg, Tony Malkin still has more on his shopping list, and the Empire State Building owner is ready to make another deal for just about any kind of real estate.
“We’re omnivorous opportunivores,” Malkin said today on an earnings call that introduced a new anthropological term to the business-speak lexicon.
Malkin’s feisty words came after his family-controlled business, Empire State Realty Trust, reported another quarter of above-average leasing volume and occupancy rose by 90 basis points to 88.5%. BMO Capital Markets said Malkin paid a considerable $2,575 per square foot for the Williamsburg retail properties, located on North Sixth between Berry Street and Wythe Avenue, plus another unidentified location.
Malkin can afford to keep shopping because his firm has the most risk-averse balance sheet of any publicly traded New York landlord. Half a billion dollars are parked in cash and there’s no floating-rate debt. Leverage levels are half that of rivals.
The price Malkin paid in Williamsburg means the property could yield as little as 2%, BMO analyst John Kim calculated. That’s not an attractive return when a 2-year U.S. Treasury bond yields 4.4%. Malkin assured that over time the properties will deliver.
“The fact is they will produce a heck of a lot of cash,” he said.
Empire State Realty’s stock price was little changed Thursday, at $10.50 a share. It has gained about 25% in the past year, better than Boston Properties or Vornado Realty Trust.
Malkin’s family has owned the Empire State Building since 1961 and their company controls 8 millions square feet of space, mostly in modernized Midtown office buildings such as 1350 Broadway and One Grand Central Place on East 42nd Street.
Malkin said he looked into buying 250 Park Ave., which is being acquired by JPMorgan for more than $300 million. Office accounts for 58% of Empire State’s rental income and even though he’s ready to shop for just about anything, Malkin’s not ready to buy an office building.
“We’re biding our time,” he said.
Prolific national grocery chain Trader Joe's opened in Harlem Thursday morning — marking the 10th location so far in the borough but the first in the Upper Manhattan neighborhood.
The California-based brand, known for its frozen meals and kitchen staples, now occupies 17,800 square feet in the recently developed mixed-use project called the Urban Empowerment Center, which will house a new headquarters for Harlem-founded civil rights organization the National Urban League.
Harlem has long been considered one of the city's several food deserts, with a dearth of grocery store options available for the neighborhood's thousands of residents — many of them elderly and with health-related issues — according to a 2015 study from the Food Policy Center at Hunter College. Nearly a decade ago, when the Pathmark supermarket closed at the corner of 125th Street and Lexington Avenue, the problem only got worse, the study said. Since then, no other grocery store has replaced the shuttered Pathmark, but a Food Bazaar opened nearby on Third Avenue two years ago.
Trader Joe's started in Los Angeles in 1967, and the Harlem location now joins more than 550 across the country. Nakia Rohde, a spokeswoman for Trader Joe's, declined to provide details of the store's lease agreement on West 125th Street.
The sprawling Urban Empowerment Center, between Malcolm X and Adam Clayton Powell Jr. boulevards, includes 90,000 square feet of Class A office space and 84,000 square feet of retail space, including the Trader Joe's, a Target and a Sephora, which make up the 6-story retail and office building. An adjacent 17-story residential tower includes 171 below-market-rate apartments.
Developed by Taconic Partners, L+M Development Partners, The Prusik Group and BRP Cos., the Urban Empowerment Center is a stone's throw from the 125th Street subway station serving the 2 and 3 lines and about a block away from the historic Apollo Theater — one of several local landmarks the artwork inside the Trader Joe's will pay homage to.
Construction on the $242 million, 414,000-square-foot center, which was also developed in partnership with Empire State Development, broke ground in 2021, Amsterdam News reported at the time. The project is slated to be completed early next year, and as part of the National Urban League's Harlem homecoming after decades located in the Financial District, its new 81,000-square-foot headquarters will also feature the city's first museum dedicated to the civil rights movement.
Leases
Indian restaurant opening in Alphabet City
Address: 202 Ave. A, Manhattan
Landlord: Highpoint Property Group
Tenant: Jhakaas
Lease size: 3,000 square feet
Asking rent: $150 per square foot
Asset type: Retail
Brokers: Meridian Retail Leasing's Noam Aziz represented the tenant. Current Real Estate Advisors' Michael Segerman represented the landlord.
Sales
Rockledge, PH Realty pick up another Brighton Beach building
Address: 3100 Brighton Second St., Brooklyn
Seller: Sentinel Real Estate Corp.
Buyer: Rockledge and PH Realty Capital
Sale price: Approx. $13 million
Asset type: Multifamily
Financings
Fortis finances bulk group of Dumbo condos
Address: 60 Front St., Brooklyn
Owner: Fortis Property Group
Lender: G4 Capital Partners
Loan amount: $89.8 million
Asset type: Condos
South Ozone Park storage facility lands financing
Address: 130-02 S. Conduit Ave., Queens
Owner: Joshua Weingarten
Lender: LoanCore Capital
Loan amount: $25 million
Asset type: Industrial
As the impact of climate change becomes even more apparent, and sustainability becomes a greater priority across all sectors, New York’s clean energy transition has continued to gain momentum. According to the New York State Energy Research and Development Authority (NYSERDA)’s 2023 New York Clean Energy Industry Report, the state’s clean energy industry gained 5,800 jobs between 2021 and 2022, adding workers at a faster rate than the state’s overall workforce and in greater numbers than neighboring states.
With this transition comes a necessary reconfiguration of the workforce to support this sustainable future. Workforce development and training opportunities are critical components of building a clean energy economy that is resilient, equitable and inclusive of all New Yorkers. However, we must overcome barriers such as a lack of skilled talent, limited awareness of job opportunities among potential workers, and the need for more training opportunities.
The demand for clean energy workers is increasing at an unprecedented rate, but the current pipeline for a skilled workforce is lacking. In NYSERDA’s report, 45% of clean energy employers reported that it was very difficult to hire talent, and another 48% reported it was somewhat difficult.
To meet the growing demand, we must invest in education and training programs that can prepare individuals for these jobs, while ensuring that these opportunities are accessible to all, regardless of socio-economic background, education or previous work experience.
In Westchester County, we are actively expanding our capacity in the clean energy sector to support current and future employers, as well as our residents. One of the first steps we took was partnering with Sustainable Westchester, who works with our municipalities to implement clean energy initiatives. Together, we created a Clean Energy Careers Accelerator Program, which has been tasked with identifying the workforce needs of the sector and creating strong clean energy career pathways.
The Accelerator’s Careers Working Group, comprised of more than 30 employers and other key stakeholders, has evaluated the training programs currently available in the county and identified the gaps. In April, we hosted the inaugural Westchester County Clean Energy Careers Job and Resource Fair, which brought together employers and resource providers with job seekers, and also featured panels on training and job opportunities. The event drew more than 150 attendees, ranging from clean energy industry advocates, environmental leaders, and employers to job seekers and students. It provided job seekers the opportunity to explore clean energy career pathways and connected clean energy solution providers to a qualified workforce.
One of our partners in our ongoing efforts to support clean energy employers and job seekers alike is Soulful Synergy, a minority-owned workforce development agency dedicated to creating equitable and sustainable communities that provide free workforce training programs that serve as both an on-ramp for job seekers looking to enter or transition into the clean energy workforce, as well as upskilling existing workers. One of Soulful Synergy’s major initiatives is the Clean Energy Academy which is a collaboration between large industry stakeholders like Willdan Energy Solutions and local utility Con Edison, as well as small MWBE firms working together to recruit, train, and place jobseekers into meaningful careers within the industry. The program has successfully graduated more than 1,000 participants ranging from individuals currently working in the field looking to advance, those with backgrounds in environmental sciences looking to transition into the space, to those with little to no experience wanting to break into the industry.
About half the individuals who participate in the program are unemployed or underemployed at the start of training, with more than 70% achieving employment post-program and roughly 80% of graduates represent disadvantaged communities and priority populations. In addition to hands-on installation roles, Soulful Synergy reports that some of the biggest demands they see from employers are workers to fill roles in energy auditing and engineering analysis, finance and incentive administration, inspections, procurement and project management. Many of the Clean Energy Academy participants have transferrable experience that can help them succeed in these roles, including sales, customer service, data, and project management.
The ever-evolving state of the clean energy industry also impacts the workforce pipeline. Mount Kisco-based Dandelion Energy, which provides geothermal heating and cooling systems to homeowners, recognized the need for skilled drillers, but was having a hard time finding them. In response, Dandelion created its own training program for those interested in working in the field. This high-skill, high-paying job is well suited for individuals with backgrounds in industries such as construction, landscaping and excavating. Each trainee is partnered with an experienced driller on each rig, and within six months are able to move onto their own team with their own trainees. This learn-by-doing model is helping them fill the gaps in the industry and their own workforce.
The transition to clean energy is necessary for the health of our planet and creates the opportunity to build a more sustainable, equitable and prosperous future for New Yorkers. Developing and cultivating a clean energy workforce pipeline is a cornerstone of this work, and requires participation from local governments, businesses and educators. Investing in the skills and talents of our workforce ensures that the transition to clean energy is not just a shift in how we power our state, but a movement that lays the foundation for a brighter, greener future for all New Yorkers.
Bridget Gibbons is the Director of Economic Development for Westchester County.
The landlord at a Long Island City luxury rental building took advantage of a controversial affordable housing tax break despite not abiding by the terms of the program, according to a new lawsuit from a small group of the property's tenants.
The suit accuses the Lightstone Group, a Midtown-based developer founded by David Lichtenstein, of violating the 421-a program in its Queens building Gantry Park Landing at 2-14 50th Ave. by manipulating the use of concessions, or months of free rent. Under 421-a, landlords must register an apartment's initial rent as what tenants are actually paying and base all increases off of that figure, but Lightstone registered the rents for Gantry Park apartments as higher than what tenants paid by not factoring in concessions, the lawsuit claims.
When it was time to renew leases, Lightstone based its rent increases off of these higher rents, essentially treating the apartments as deregulated despite getting the 421-a tax benefits, the suit says.
One tenant moved into an apartment in June 2021, for instance, and Lightstone registered the rent as $3,525 per month even though the tenant was paying about $2,750 per month once his concessions were factored in, the lawsuit says. This meant he was paying a "preferential rent," which in turn meant Lightstone could increase it only by as much as the Rent Guidelines Board allowed, according to the suit.
However, when it was time to renew this lease, Lightstone raised it by more than 30% to about $3,717, far more than the 3.25% increase allowed by the RGB, the suit claims. It accuses Lightstone of "camouflaging the preferential rent as a concession," allowing it to charge steep rent increases upon lease renewals, and seeks an unspecified amount of money from the court.
"Given the prevalence of all the cheating and the unabashed skirting of the requirements of the rent laws, our courts need to send a clear message that these kinds of shenanigans will not be tolerated," said Lucas Ferrara, senior partner at Newman Ferrara and an adjunct professor at New York Law School who is representing the five named tenants suing at this time with his colleague Roger Sachar.
A representative for Lightstone did not immediately respond to a request for comment.
The lawsuit was sparked by an investigation from the watchdog group Housing Rights Initiative, a frequent critic of 421-a that has helped spearhead similar lawsuits before. These include an ongoing case from early 2023 against Fairstead Management accusing the firm of violating 421-a in the same manner as Lightstone at 11-15 Broadway in Queens.
"When landlords cheat on affordable housing tax benefits, they are screwing both taxpayers and tenants," said Aaron Carr, founder and executive director of the group.
Gantry Park Landing was built in 2013 and stands 12 stories tall with 199 units and amenities such as a gaming lounge and fitness center, according to commercial real estate database CoStar and Lightstone's website. There are six available units in the project, ranging in price from $3,527 per month for a studio to $6,255 per month for a two-bedroom, according to StreetEasy.
The 421-a program provided developers with a tax break if they designated at least 30% of the units in their building as affordable housing. It was popular in the real estate community but more controversial outside of it, and a lack of enforcement was one of the main reasons why.
The program expired in June 2022, and the state replaced it with a comparable program dubbed 485-x in this year's budget. It also extended the completion deadline for projects already in the 421-a program from June 2026 to June 2031.
U.S. economic growth accelerated by more than forecast in the second quarter, illustrating demand is holding up under the weight of higher borrowing costs.
Gross domestic product increased at a 2.8% annualized rate in the April-June period after rising 1.4% in the previous quarter, the government’s initial estimate showed. The economy’s main growth engine — personal spending — advanced 2.3%, also more than projected.
A closely watched measure of underlying inflation rose 2.9%, easing from the first quarter but still above estimates, the Bureau of Economic Analysis report showed Thursday.
Even though the pace of growth picked up from the first quarter, the figures still represent a moderation from last year. Consumer spending and broader economic activity have cooled under the weight of high interest rates, which is simultaneously helping to tame inflation gradually.
That bodes well for the Federal Reserve, which is trying to pull off a soft landing for the economy and likely to start cutting interest rates as soon as September. However, it’ll be a fine balance to cool the labor market just enough without putting millions of people out of work, especially as unemployment has now risen for three straight months.
“This is a perfect report for the Fed, growth during the first half of the year is not too hot, inflation continues to cool and the elusive soft landing scenario looks within reach,” Olu Sonola, Fitch Ratings head of economic research, said in a note.
Treasury yields rose slightly and stock futures fluctuated after the report. Policymakers aren’t expected to cut rates when they meet next week.
Consumer spending was driven mostly by a rebound in durable goods like cars and furnishings as well as a more moderate advance in services outlays compared to the first quarter, according to the GDP report.
Government spending contributed more to GDP compared to the first three months of the year, boosted by defense spending. Residential investment subtracted from growth for the first time in a year as high mortgage rates kept a lid on sales activity and new construction.
Business investment grew at the fastest pace in almost a year, led by the strongest advance in equipment since the start of 2022. A separate report Thursday showed orders placed with factories for business equipment, excluding aircraft and defense, increased in June by the most since early last year. It’s a sign such spending will keep adding to growth in coming months.
Inventories added to GDP for the first time since the third quarter of last year, boosted by the biggest jump in the value of retail autos on record after a cyberattack hampered some dealerships’ abilities to process sales. That was mostly offset by net trade, with the deficit near the widest in two years.
Stripping out inventories, government spending and trade, inflation-adjusted final sales to private domestic purchasers — a key gauge of underlying demand — rose 2.6% for a second straight quarter.
Going forward, forecasters expect the economy to decelerate more notably in the second half of the year as the labor market loses steam, slowing income growth further and taking a bigger hit out of consumer spending. Recent earnings reports from PepsiCo, Nike and several airlines have also indicated Americans are starting to pull back and increasingly stretching themselves financially.
Separately, weekly initial applications for unemployment benefits decreased by 10,000 to 235,000 in the latest period, and continuing claims also declined. The claims data are prone to big weekly swings this time of year, which include holidays as well as school closures for summer break and annual auto retooling period for new model changeovers.
A longtime hub for Regency armchairs, Chippendale chests and Louis XV-style tables may be on its last legs.
Earlier this month a developer acquired the Greenwich Village building that for nearly a century housed Charles Cheriff Galleries with plans to convert the 7-story site into housing. The move has in turn helped shrink the antiques district around University Place, which teemed with about two dozen shops in the 1970s but is down to just a handful today.
“It’s sad, because it’s the place where our family has been since the 1930s,” Alan Wachman said of his four-generation family business. “This was home.”
Wachman likely exited with his head held high. His prewar building, located at 84 University Place near East 11th Street, sold for $11.3 million, a solid haul when considering his family paid around $500,000 for the 14,900-square-foot commercial structure in 1981, or the equivalent of $1.8 million today when adjusting for inflation. And Charles Cheriff, which specializes in French furniture that glimmers with gold-leaf detailing, did not call it quits but rather moved to Long Island City.
Renting 19th-century chairs to period dramas like HBO’s "The Gilded Age" has been a bright spot for the company. But “people’s tastes have changed,” said Wachman, who works with his brother Stephen and son Jonathan. “They’re not entertaining at home and not willing to buy special pieces.”
In a sense, Charles Cheriff may have overstayed its welcome in the district, which once stretched from about East 10th to East 13th streets and University Place to Fourth Avenue. Indeed, for years now expensive condos, trendy chain restaurants and upscale boutiques have been creeping into the neighborhood, much of which is not considered an historic district, which might have checked development.
And it perhaps should not come as a surprise. Several other neighborhoods once associated with a single industry—Chelsea’s flower district, the Garment District and especially the Meatpacking District—have few traces left of their historic selves.
Some antiques shops do hang on by University. Survivors include Seidenberg Antiques at 36 E. 12th St. and Hyde Park Antiques at 836 Broadway, though the latter isn’t long for that location. The Karr family, which has owned the store’s 6-story building since the 1980s, unloaded it in 2021 to developer ZG Capital for $39.3 million, according to the city register, and ever since has leased its space there as a tenant.
And ZG, which is renovating the landmark office building, has not extended the store’s lease past next year. “We’re not sure yet where we will go,” said Rachel Karr, whose father Bernard Karr founded the shop in 1965. “But the times and the business have changed.”
84 University Place
This 7-story Italianate building, whose facade is somewhat shrouded with dark-toned fire escapes, was home to Charles Cheriff Galleries from the 1930s until this year. The antiques store specializes in French furniture made in the late 19th century to resemble classics from the 18th-century era of Kings Louis XV and Louis XVI. Earlier this year brothers Stephen and Alan Wachman sold the site for $11.3 million to developer Mark Guindi, the CEO of GD Capital Group, who plans on turning the building into a six-unit rental that has retail space on the ground floor. Guindi did not return a call for comment. The Wachmans, whose grandfather Charles founded the business in 1924 after emigrating from Russia, have relocated their 3,000-piece collection to 22-19 41st Ave. in Long Island City near the Ed Koch-Queensboro Bridge. With Charles Cheriff’s departure from University Place, a longtime antiques district in the neighborhood has almost disappeared.
83 University Place
This 11-story, 191,000-square-foot building from 1890 seems to have once been a manufacturing building. Textile and garment companies were early tenants, according to news clips. But in recent decades, No. 83 has served as an office building catering to PR firms, doctors, insurance companies, fintech start-ups and co-working providers. Its most visible contribution, though, might be the numerous fast-casual style restaurants that ring the building’s ground floor. A two-year-old location of the popular and quickly-growing Naya chain, which serves falafel and hummus dishes at 11 locations in Manhattan, is here. The building’s ownership hasn’t changed since at least the 1960s, according to property records. It seems to involve members of the Manley family, though a trust has controlled No. 83, which also uses the addresses 95 University Place and 41 E. 11th St., since 2005. The firm that runs the building day to day is the Thomas F. Campenni Company. It is currently listing a 20,000-square-foot berth on the fifth floor for a rent of $40 per square foot annually.
86 University Place
The history of this site is as colorful as the strings of flights that twinkle in its downstairs Mexican restaurant. Once the home of Benjamin Field, a prominent hospital philanthropist, the building later housed the human hair wig business of German immigrant Bernhard Mittelstaedt, according to Village Preservation, an influential nonprofit advocacy group. His name remains carved on the cornice. During Prohibition No. 86 housed a speakeasy, and in the 1940s it was home to a lesbian bar called the Bagatelle, accounts show. The current eatery, whose name El Cantinero means “the bartender” in Spanish, opened in the early 1990s. Its 3,500-square-foot two-level berth pours margaritas seven days a week. The 5-story property, which also features four apartments, has changed hands several times in recent decades. In the most recent transaction from 2015, New Jersey investor Lewis Lustbader sold No. 86 to Mark Lundy of Long Island firm Gould Investors for $13.7 million. Lundy borrowed $6.8 million for the transaction from Florida-based BankUnited, the city register shows.
82 University Place
Cedar Tavern, whose crowd in the abstract expressionist heyday of the 1950s might have had the highest number of artists in the city’s history, was based first at 24 University Place. It was dislodged by development in the 1960s and wound up at this address soon afterwards. Bob Dylan was among the new site’s early habitués. Amid the frenzy of the mid-2000s condo boom, tavern owner Michael Diliberto took a turn as a developer and added seven floors atop the existing structure to create a seven-unit condo, sales of which nabbed him $16.4 million, according to its offering plan. A stipulation of that plan was to not allow bars again, and the downstairs retail space offers bikini waxes today. The 3-bedroom duplex penthouse, which has a terrace, traded for about $4 million in 2023. It sits “just steps away from Whole Foods,” its ad said, “making it the perfect location.”
90 University Place
Although this 3-story plain-fronted building may look unassuming, it played a starring role in the area’s bohemian history. It contained the studio of photographer Arthur Swoger, known for his portraits of the poets and abstract expressionist painters who imbibed at Cedar Tavern, a nexus of the downtown art world when it was at University and East Ninth Street, according to historical accounts. (The bar’s building later came down to make way for the massive Brevoort East apartment complex.) Swoger’s subjects included painters Willem de Kooning and Joan Mitchell and poet Frank O’Hara, sometimes drinking, sometimes in their studios. No. 90 has had the same owners for decades, records indicate, and they seem to include members of the Erlitz family. But the building’s retail spaces turned over frequently and have included a housewares store, jazz bar and noodle shop through the years. In 1978 one of the city’s first sushi joints, Japonica, moved in before decamping in 1991 to a larger berth at 100 University Place. But when a wrecking ball claimed No. 100 a decade ago, Japonica returned to its No. 90 berth, according to the restaurant news site Eater. An outpost of the café chain The Grey Dog occupies the other narrow storefront.
99 University Place
The Textile Workers Union of America owned and operated this ornate 10-story Beaux Arts building in the mid-20th century, around when the area near Union Square was a base for labor organizations. The word “Union” in the park’s name, however, refers to its location at the merger of several roads. In 1991 local landlord Bijan Nassi purchased No. 99 from TWUA for $2.4 million, according to the city register, and the 41,500-square-foot site has mostly served as a Class C office building for small companies since then. But Nassi did not pry off the facade’s metal “TWUA Building” letters until around 2017, according to photos from Google Maps. Fashion giant Ralph Lauren operated stores in the retail space in recent years, including for its Rugby brand and Denim & Supply offshoots. Cncpts, a store dedicated to skate-wear fashion that sells sneakers and caps, occupies the 2,500-square-foot berth today. Nassi, who has appeared on the public advocate’s worst landlords list, faced foreclosure on the site in 2022 after defaulting on a $10.5 million mortgage note but squared away his debts the following year, according to court records.
21 E. 12th St.
One of the most beloved (and only) bowling alleys in Manhattan for years, Bowlmor Lanes rumbled at this site from 1938 to 2014. Then-Vice President Richard Nixon hurled balls there in 1958. After it shuttered, owner William Macklowe Co., headed by longtime developer William Macklowe’s son Billy Macklowe, demolished the site and its sidewalk stores to put up a 22-story, block-long condo and retail complex. Billy Macklowe, who partnered with Goldman Sachs on the project, earned $304 million from sales of the building’s 52 homes, which are mostly 1- to 4-bedroom units, according to the condo’s offering plan. Closings began in 2019, though the retail spaces, which line a wide podium under the tower that uses the address 110 University Place, took longer to fill. Tenants in them today include a wine bar from the Serafina restaurant group that opened in the fall. Tom Shannon, who bought Bowlmor in 1997 but had to exit when the site sold, has since become a bowling mogul, buying other alleys like the Lucky Strike line in 2023. His Bowlero Corp. today owns 12,000 lanes across the country.
Community opposition to the Related Cos.’ casino proposal at Hudson Yards could give a boost to the Times Square bid spearheaded by rival developer SL Green Realty.
“I’d counted out Times Square,” a local elected official told Crain’s on the condition of anonymity. “But in a world in which Hudson Yards is dead and the other three [Manhattan] bids are not sophisticated then maybe we’re back to considering Times Square.”
SL Green has teamed up with Caesars Entertainment and Roc Nation to develop a casino at 1515 Broadway, a 54-story building it owns.
CEO Marc Holliday told Crain’s on Tuesday his casino would be the most conveniently located of any proposal and help draw crowds back to Times Square, where pedestrian traffic remains 40% below 2019 levels, according to the latest data from the Times Square Alliance. The casino would create more demand than it can accommodate, Holliday said, so nearby hotels and restaurants would benefit and his bid has the support of almost 200 organizations, including Actors’ Equity, Laborers’ Local 79, and Alicart Restaurant Group, operator of Carmine’s and Virgil’s BBQ. The bid is also supported by property owners including RFR Realty and Wyndham Hotels & Resorts.
“I think we have massive community support for this project, more than any other bid right now by a wide margin,” Holliday said.
Still, opposition appears to be growing. Last month three new groups joined the No Times Square Casino Coalition, which has more than 20 members including the Manhattan Plaza Tenants Association, Sardi’s and, perhaps most significantly, the Broadway League, a group that represents producers with the resources to fight developers. In May the coalition said a survey of 400 Midtown residents showed 71% opposed a Times Square casino.
Such opposition could discourage state officials from putting a casino in Times Square because under state law a community must demonstrate support for the idea first.
Times Square is far from the only alternative for a Manhattan casino. Silverstein Properties has its own casino bid for the far west side, while Soloviev Group has proposed one on a long-empty site near the United Nations. In between those two is Hudson’s Bay Co.’s bid to build a casino atop the Saks Fifth Avenue flagship, across the street from St. Patrick’s Cathedral.
And over at Hudson Yards, Related is hardly conceding the battle. A Related executive said the developer has met 10 times with Friends of the High Line, a group that opposes a Hudson Yards casino, and “made meaningful amendments to our proposal in direct response to concerns they raised.”
State officials aren’t expected to determine where downstate casinos licenses land until late next year.
A group of businesses that administer a popular state-run home care program is taking legal action against the state Health Department over a payment overhaul it says could worsen a shortage of home care workers in New York.
The industry group Consumer Directed Personal Assistance Association of New York State filed a lawsuit in an Albany state court on Monday stating that the Department of Health unlawfully changed how Medicaid reimburses businesses that administer the Consumer Directed Personal Assistance Program, a home care model that allows people to hire and train their own caregivers.
The changes, set to take effect on Aug. 1, could slash $200 million from state Medicaid payments to fiscal intermediaries, which are businesses that manage payroll and conduct administrative tasks for homecare aides and consumers. The home care industry says the cuts could result in lower home care wages and reduced access to care within the Consumer Directed Personal Assistance Program.
State officials are trying to rein in spending on the $9 billion program following a decade of unprecedented growth. It has swelled by more than 1,200% due to loosened rules delegating who could provide caregiving.
The upcoming reimbursement changes are set to implement a three-tiered payment system for agencies that administer the home care program based on the number of care hours consumers get. The monthly rates will also split up reimbursements for direct care and administrative costs, which are currently paid to agencies in one lump sum.
The Health Department made the changes based on feedback from the federal Centers for Medicare and Medicaid Services, according to a notice on its website. But the companies allege that the Health Department unveiled the changes in an “unusual” way, presenting them at a meeting with health plans in May without their input.
The industry fears that cuts to reimbursement will hamper them from covering the costs of not only training aides and managing payroll, but also direct care, said Laura Cardwell, director of operations at the Consumer Directed Personal Assistance Association of New York State.
“The real-world impact of this is going to be pay cuts,” Cardwell said.
Reimbursement changes for home care agencies often result in slashes in pay for home care aides, which Cardwell said will exacerbate an existing shortage in home care workers, specifically outside of New York City.
Six home care agencies, including Bengal Home Care in Jackson Heights, Home Choice in Parkchester and Marton Care in Williamsburg have signed on to the lawsuit. The industry is petitioning the court to stop the reimbursement changes.
Asked about the allegations, Health Department spokeswoman Cadence Acquaviva said that the agency does not comment on pending litigation.
The lawsuit comes as the Consumer Directed Personal Assistance program faces upheaval from changes in the state budget. Gov. Kathy Hochul spearheaded a proposal to whittle down the number of businesses and nonprofits administering the program from the roughly 700 that do so currently to just one in an effort to cut costs of the program.
Roughly 250,000 people in New York use the home care program and require care from 300,000 personal care aides, according to the lawsuit.
The lawsuit also follows a similar case won by the Consumer Directed Personal Assistance Association of New York State in 2019 to change reimbursement rates without following regulatory protocols.
More than 200 nursing homes are suing the state over new Medicaid reimbursement rates they say jilt them out of compensation for services already rendered.
In a suit filed July 18 in state Supreme Court in Albany, the petitioners allege the state Department of Health misapplied rates tailored for last year’s services to the first quarter of 2024, when the homes say their reimbursement should have increased.
The rate, known as the “case-mix adjustment,” offers nursing homes greater remuneration based on the intensity of care provided, with higher-acuity residents drawing higher compensation. The rate is intended to incentivize nursing homes to admit residents with more demanding health care needs to avoid them languishing in hospitals where the cost of care is greater.
In recent years, the rate has been recalculated every six months – on January 1 and July 1 – based on the latest acuity levels. But on June 28 the Health Department submitted a request to the federal government to change the methodology it uses to determine the rate and, in the meantime, to freeze the rate at the July 2023 level. But state law does not permit such changes to apply before the first day of the quarter in which it is announced, the lawsuit claims. In this case, that date is April 1, 2024, meaning any reimbursements for services rendered before that date should be based on the intensity of patient needs at the end of 2023, the suit contends.
“Petitioners made their decisions with respect to admitting patients on the basis of and in reliance on that reimbursement policy,” the lawsuit states, referring to the previous methodology.
The lawsuit alleges Health Commissioner James McDonald “illegally, arbitrarily, capriciously” froze reimbursement rates at July 1, 2023 levels and called the Department’s June 28 proposal to change the reimbursement methodology “misleading and inaccurate.”
“While it purported to have an effective date of April 1, 2024…, in reality it proposed to make changes to the State’s Medicaid reimbursement methodology retroactive to January 1, 2024,” the filing states.
The petitioners, all members of Albany-based New York State Health Facilities Association, an association of long-term care and assisted living facilities, are asking the court to strike down the new rate regime and recalculate reimbursements, along with any attorney’s fees for the lawsuit.
“If they were to go back to July, they are really shorting the payment to these providers,” said Stephen Hanse, president and CEO of the Health Facilities Association.
The Department of Health declined to comment on ongoing litigation, according to spokeswoman Cadence Acquaviva.
Because each nursing home has a different size, patient population, and reimbursement rate, the coalition has not determined what specific dollar figure it is seeking.
The state is expected to file its response with the court in the coming weeks, after which a court date can be set. While Hanse is concerned about what methodology the state may ultimately come up with, the coalition does not have grounds to oppose any future changes.
“It’s nothing we can really challenge legally at the present time,” Hanse said.
CORONA HEALTH CENTER: The New York City Department of Design and Construction and the Department of Health and Mental Hygiene broke ground Wednesday on a $10.5 million renovation of Corona Health Center in Queens. The project will focus on the main entrance, lobby, and building façade and is expected to make the 1939 building more accessible. The plan also includes a total renovation of the center’s 6,500 square foot cellar and is expected to be completed in 2026.
HEALTH VENDING MACHINES: The city’s Department of Health and Mental Hygiene has quietly ended its free public health vending machine program, which offers medical products like Covid tests and naloxone, The City reported Wednesday. The program, which launched in 2022 and was intended to expand to 10 vending machines citywide, closed in May after only four machines were unveiled. Those machines, in Brooklyn and Queens, were seeded with $750,000 from the city and managed by local organizations.
Empire State Realty Trust, a property owner focused on New York City buildings, struck $195 million in deals for buildings in Brooklyn, expanding its bet on a key shopping corridor in Williamsburg.
The company, which owns the Empire State Building, agreed to two deals to buy retail spots on North 6th Street in Williamsburg, with one transaction totaling $103 million and the other amounting to $92 million, according to a statement Wednesday. The all-cash deals haven’t yet closed.
The purchases will help the company build out its presence on North 6th Street, where it already owns some retail spots leased to tenants including cosmetic goods company Glossier and facial studio Glowbar.
The recent “transactions are consistent with our strategy to recycle capital and balance sheet capacity from non-core suburban assets into strong NYC assets,” the company said in the statement.
Empire State Realty also announced Wednesday core funds from operations of 24 cents per share in the second quarter, which matched the average analyst estimate compiled by Bloomberg. The company said it would disclose more about the Williamsburg purchases once the deals have closed.
Sen. Bob Menendez of New Jersey resigned effective Aug. 20, giving in to fellow Democrats’ demands he step down following his conviction on federal corruption charges in New York last week.
Menendez’s political support collapsed after a jury found that he had received bribes of gold bars, hundreds of thousands of dollars in cash and a Mercedes convertible in return for official favors extended to three businessmen and on behalf of Egyptian interests.
His wife, Nadine, was also charged but has not yet been tried.
Menendez, 70, said in his resignation letter Tuesday that he would appeal the verdict but did not want to involve the Senate “in a lengthy process that will detract from its important work.” He said he was delaying his departure until next month so his staff could find new jobs and he could “close out my Senate affairs.”
Before the trial, he gave up his chairmanship of the Senate Foreign Relations Committee.
Senate Majority Leader Chuck Schumer and New Jersey Gov. Phil Murphy called on Menendez to resign almost immediately after the jury delivered its verdict. Murphy has authority to name a replacement to serve until Jan. 3, when the senator’s current term ends.
“I will exercise my duty to make a temporary appointment to the United States Senate to ensure the people of New Jersey have the representation they deserve,” Murphy said in a Tuesday statement.
Menendez’s position became untenable in part because a key Democratic election strategy is to attack former President Donald Trump on his 34 felony convictions.
Rep. Andy Kim is running as the Democratic nominee to replace Menendez in the November election. Kim said in a statement Menendez “made the right decision” to quit the Senate.
John Fetterman of Pennsylvania became the first senator to call on Menendez to resign when he was charged, followed by Sherrod Brown of Ohio, the chairman of the Banking Committee, where Menendez has served as a senior member.
Menendez easily won reelection in 2018 after a separate 2017 corruption trial ended in a hung jury and the Justice Department dropped the charges. The Senate Ethics Committee, however, admonished him for his relationship with Salomon Melgen, an eye doctor.
The committee found that Menendez received numerous gifts without disclosing them while advocating for Melgen. Melgen was convicted of stealing $42 million from Medicare. His 17-year sentence was commuted in January 2021 by Trump in one of his last acts in office. Menendez supported the commutation.
In 2006, Menendez, then a member of the US House, was appointed to the Senate by Governor Jon Corzine, who had given up his Senate seat.
He won election later that year, was an advocate for the Latino community and immigration reform domestically, while becoming a hawk on foreign policy. He was especially firm against Iran and Cuba, which his parents had left a few months before he was born in New York City.
He had served in 2010 as the chair of the Senate Democrats’ campaign committee, but cultivated relationships on both sides of the aisle. Senator Lindsey Graham, a South Carolina Republican, served as a character witness at his first corruption trial.
It's no secret renters in New York pay more for less. Prices are the highest in the country, yet apartments are some of the smallest and continue to shrink.
Three boroughs in particular, though, are among the worst regions for renters in the U.S., at least according to a new report from RentCafe. The apartment listing service's 2024 rankings of the best cities for renters put Manhattan, Queens and Brooklyn within the bottom 10.
The report considered U.S. cities with at least 10,000 apartment units and 50,000 residents, of which there were 149. RentCafe treated New York's three most populous boroughs each as their own city; it omitted The Bronx and Staten Island from the final report.
Of New York's representation on the list, Manhattan fared the worst. It ranked No. 146 overall, sitting just ahead of Sunnyvale, California, Detroit and Newark, which RentCafe now considers the worst U.S. city for renters. Queens ranked No. 144, falling slightly behind Brooklyn at No. 140.
The report compared cities on 20 metrics related to their housing and cost of living, local economy and quality of life. Factors included rent prices, apartment sizes, the share of new units, air quality, natural amenities and more.
New York's boroughs were plagued most by housing and cost of living measures, which accounted for 50% of the rankings. Manhattan was at the very bottom of that index, while Brooklyn was fourth-worst and Queens was fifth-worst. All boroughs were dinged for their small average apartment sizes, Queens' being 721 square feet, the third smallest overall, followed by Brooklyn's 742 square feet and Manhattan's 748 square feet. Queens also had worse property ratings than any other U.S. city on RentCafe's website. Still, Manhattan ranked lowest among the boroughs thanks to it having the country's most expensive rent prices.
What kept the three boroughs from falling even lower on the overall rankings were their relatively high scores in the local economy and quality of life indexes.
Manhattan had the No. 12 best local economy, per RentCafe's analysis of unemployment rates, job growth, new business applications and more. Brooklyn was labeled No. 35, while Queens sat at No. 60.
Manhattan also scored highest among the boroughs on quality of life, clocking in at No. 5 overall based on school quality, length of commutes, sociability and more. Brooklyn was No. 45, and Queens was No. 65.
The RentCafe analysis relied on data from the U.S. Census Bureau, the Cost of Living Index, the Bureau of Labor Statistics, GreatSchools, County Health Rankings, the Environmental Protection Agency and Yardi Matrix, a RentCafe sister service.
RentCafe named Charleston, South Carolina, as the best city for renters for the second year in a row.
Asked why New York's other two boroughs were not included in the report, a spokesperson wrote in an email to Crain's "given that Manhattan, Brooklyn, and Queens have very high densities and distinct dynamics, we chose to treat them separately rather than blending them into a single entry for New York City."
New York-Presbyterian is planning to close a rehabilitation unit at Columbia University Irving Medical Center for patients recovering from serious injuries.
The health system has requested approval from the state Department of Health to transition 16 acute inpatient rehabilitation beds to medical-surgical beds at the 745-bed Milstein Hospital in Washington Heights, the organization confirmed.
The proposal is the latest attempt by a New York City hospital to shift services to potentially improve their bottom lines. But community members say that the closure will eliminate access to recovery care for patients with serious health conditions in Upper Manhattan and the Bronx.
Hospital rehabilitation units – which provide services like physical, occupational and speech therapy – are often the first step to recovery for patients after a serious health event like a stroke or organ transplant. Rehabilitation is not a lucrative business for hospitals, unlike revenue-boosting specialties such as orthopedic surgery or cardiology, which require medical and surgical beds like the planned replacements.
New York-Presbyterian Hospital brought in $14 million in Medicare dollars for hospital rehabilitation care in 2022, just over 1% of its total inpatient revenue, according to Medicare cost report data compiled by Modern Healthcare. New York-Presbyterian earned $12 billion in total revenue across its eight general hospitals in 2023, its latest financial statement shows.
The decision to close the rehabilitation unit is “a clinical one,” said Tony Chau, spokesman for the hospital system in response to a question from Crain’s about how the closure would impact revenue, adding that the choice was based on the hospital’s evaluation of patient need and its census.
New York-Presbyterian is planning the closure in an attempt to reduce wait times and ease overcrowding in its emergency department, Chau said. In lieu of a rehab unit, the hospital will offer bedside evaluations and rehab services as it transfers patients to their homes or to a dedicated rehabilitation site, he added.
Local community members have pushed back on the plan, stating in an online petition that the closure would decimate the only acute rehabilitation center serving Washington Heights, Inwood, Riverdale and the South Bronx. Patients with serious injuries aren’t often in the best position to travel long distances, and the closure could force them to go home without adequate rehab care or caregiver training, the petition says.
“Acute rehabilitation is a crucial step from hospital to home for people who have suffered from serious illness or injury,” the petition said, adding that the closure will reduce acute inpatient rehabilitation beds across the entire New York-Presbyterian by 25%.
The health system did respond to an inquiry about the criticisms of its plans to shutter inpatient rehab beds.
The planned closure of the rehab unit follows previous attempts at New York-Presbyterian to shutter hospital units, including the proposed closure of a midwifery program at Allen Hospital in January. Outrage from community members and a warning from state Attorney General Letitia James led New York-Presbyterian to relaunch the midwifery unit in March.
NYC Ferry travelers will have to pay 50 cents more per trip this fall, a 12.5% fare increase, as the city seeks to rein in a heavy subsidy for the service.
Starting Sept. 9, the city’s Economic Development Corp. will boost the price of a single-trip ticket to $4.50 from $4. The Adams administration has upped the base NYC Ferry fare by more than 63% over the last three years — spiking the fare from its initial $2.75 fee — as part of efforts to majorly reduce the system’s notoriously high per-rider subsidy.
After Mayor Bill de Blasio’s administration launched the system in 2017, the service averaged a per passenger subsidy of $10.73, far more than the city’s original estimate of $6.60, according to analysis from government watchdog the Citizens Budget Commission.
The EDC says that figure has since dropped to $8.55 for 2023, but the service remains highly subsidized compared to other mass transit options. In 2022, for instance, the per trip subsidy for New York City Transit’s subway and buses was $2.07 and $4.47, respectively. A 2023 fare boost for those systems, from $2.90 to $2.75, amounted to only a 4% price jump.
EDC spokesman Adrien Lesser said ferry officials settled on the 50-cent increase as a sweet spot to boost fare revenue without majorly discouraging riders to utilize the system. Expanded discounts will also help keep the system affordable to regular commuters, the agency said. Come September, for instance, bundles of 10 tickets will similarly increase to $29 from $27.50, which averages at about $2.90 a ticket — the same fee to swipe onto the subway or a bus.
An existing NYC Ferry discount program, which is modeled after the city’s Fair Fares program for the subway and buses, currently makes the nautical network more affordable with one-way fares of $1.35 for people older than 65, those with disabilities and residents already enrolled in Fair Fares. In September, the program’s fee will rise slightly to $1.45 and High School students who ride ferries on weekdays to travel to and from school will be eligible for the discounts.
The ferry system has come under fire for its disproportionate appeal to wealthy and white riders, despite having been designed as an equity-minded system capable of serving neighborhoods without other transit options. In 2023, just 35% of NYC Ferry riders identified as nonwhite or multiracial compared to 47% of residents in the neighborhoods close to ferry stops, according to the system's annual survey.
Ticket and discount reforms began in 2022, when the Adams administration launched a financial improvement plan known as NYC Ferry Forward. City Hall published the framework days after City Comptroller Brad Lander released a blistering audit that found shoddy oversight and mismanagement of NYC Ferry had cost taxpayers more than $200 million in underreported costs over six years.
More recently, the NYC Ferry system has sought to raise new revenue through corporate partnerships. Recent initiatives include a search for a corporate sponsor to pay for naming rights for the NYC Ferry system, a collaboration with Gay Pride Apparel for a collection of Pride Month merchandise and hosting a listening party for Taylor Swift’s new album on board an East River ferry.
The city’s real estate world has mostly raved about Mayor Eric Adams’ City of Yes plan that loosens zoning rules to boost housing construction. But developers and some experts are raising concerns about one rule change they warn could actually reduce how much new housing gets built.
Groups like the Real Estate Board of New York, while highly supportive of the broader plan, began speaking out this month against a proposal to replace an existing program offering density bonuses for affordable housing with another that they call less feasible.
A key component of the City of Yes for Housing Opportunity proposal would let developers build 20% bigger buildings in Manhattan and a few other higher-density neighborhoods if they include affordable housing. That so-called Universal Affordability Preference would replace the existing Voluntary Inclusionary Housing program, which grants a similar bonus to developers who either include affordable housing within a new project or finance it on another nearby site.
But that off-site provision would be scrapped under UAP, which covers only on-site housing. Critics argue that change would also disadvantage nonprofit and supportive housing organizations, which have long earned money from developers who pay for off-site credits to qualify for the density bonus; the money allows nonprofits to renovate their housing stock.
“If it goes through as drafted, we won’t have the funds, because there will be no market for those developers — developers will just say, ‘Forget affordable housing,’” said Mark Jennings, executive director of the nonprofit Project FIND.
The effects might be felt in the city’s highest-density zoning districts, covering neighborhoods like the Upper East and West Sides. The state’s new 485-x tax break includes labor costs that make it harder to build rental projects in those areas, advocates say. That will likely give developers an incentive to turn to condominium projects instead, but with City of Yes they would no longer be able to simply finance affordable rentals off-site to qualify for a bigger building.
That creates a “significant risk” that developers will simply choose to build within the existing zoning limits and not try for a bonus, REBNY testified to the City Planning Commission at a hearing last week. Such an outcome would undermine the main goal of City of Yes, which is to boost construction across the board.
Following the marathon 14-hour hearing on July 10, the City Planning Commission will spend the next several weeks considering changes to City of Yes. The 13-member commission is expected to approve any modifications in September, then refer the plan to the City Council for a final vote by the end of the year.
The current City of Yes proposal would allow off-site construction to continue for another 10 years for projects already in the pipeline.
Advocates are pushing City Planning to consider a range of changes to UAP. REBNY argued for simply keeping the existing Voluntary Inclusionary Housing program intact, or otherwise giving developers another 15 years to sell their development rights from the existing VIH program.
The nonprofit Citizens Housing and Planning Council proposed creating a permanent off-site option within the new UAP program, while Mark Levine, the Manhattan Borough President, said the city should study UAP’s effect on housing construction once the rules take effect and before letting the off-site rule expire.
“In areas with significant condominium development like Manhattan, we have seen that the legal and operational complexities of mixed rental/homeownership buildings have often necessitated using [the] off-site provision option for project feasibility,” Levine wrote in his official recommendation for City of Yes.
Dan Garodnick, director of the City Planning Department, said in a statement, “We take public input seriously as this proposal advances through public review.”
“On important but often technical matters like this one, it is helpful to have input from all concerned stakeholders as we consider potential modifications to craft the most complete and thoughtful policy,” Garondick said.
The proposed UAP also has stricter affordability requirements for the new housing than the existing VIH program, requiring units to be reserved for people earning an average of 60% of the area median income — equivalent to $1,747 a month for a one-bedroom — compared to 80% under VIH.
Developers have almost nothing but praise for the rest of the City of Yes housing plan, which aims to build as many as 109,000 new homes over 15 years by legalizing mid-rise apartment buildings near transit in the outer boroughs, removing requirements to include parking spaces in new developments, legalizing small apartments in backyards and garages, and allowing housing above retail space on outer-borough “main streets.”
REBNY is particularly jazzed about measures that would allow more office buildings built after 1961 to be converted into housing, which could be a boon for members of the influential trade group. But it’s unclear how the plan will fare at the City Council, where lawmakers are well aware of the harsh reception it has gotten from outer-borough residents wary of both new development and changes to parking space requirements.
The council has already approved two other sets of reforms under the “City of Yes” banner, focused on streamlining climate-friendly improvements to buildings and easing restrictions on where small businesses can locate.
New York City inked a contract on Wednesday to supply the Fire Department and other agencies with drugs used in emergency situations.
The $48 million contract was awarded to Park Surgical Co., a pharmaceutical provider acquired by Marine Park-based medical supply wholesaler Dealmed in 2016.
The money will be used to purchase treatments used in emergency situations including resuscitative drugs like epinephrine, adenosine (used for patients in cardiac arrest), and albuterol, which opens pulmonary vessels, according to Dealmed CEO Michael Einhorn. The contract also includes “specialty” drugs like the DuoDote autoinjector, which is used to treat victims of nerve agents, and Cyanokit, which helps treat smoke inhalation.
Dealmed has held similar contracts before, including one for $64.2 million that expired last year after only $16.7 million was spent, according to records kept by the city comptroller’s office. The contracts, all procured through the Department of Citywide Administrative Services, are primarily for the Fire Department’s emergency medical services, but may be used by other agencies, like the Police Department, according to Einhorn.
The new contract is “more in line with the reality of what they are going to be spending based on our projections,” Einhorn said. He directed further inquiries to the city.
Dan Kastanis, a spokesperson for the Department of Citywide Administrative services, noted that purchases through the contract are dependent on need and funding availability, and that the city is not obligated to spend the full contracted amount.
Another five-year, $8.4 million contract for emergency medical supplies to be used by the FDNY, like gauze pads and trauma dressings, was awarded to the company in January, of which roughly $870,000 has been spent to date.
Last year, Dealmed also secured a $100,000 contract with the Fire Department for Epi Kits, nearly half of which has been spent, records show. Dealmed was also a major supplier of personal protective equipment and other medical supplies to hospitals during the first wave of the COVID-19 pandemic in 2020, paying a premium for shipments from China during the supply-chain crunch.
LAYOFFS POSTPONED: Acorda Therapeutics finalized the sale of its commercial assets – two drugs, Ampyra (known overseas as Fampyra) and Inbrija, that treat symptoms of multiple sclerosis and Parkinson's, respectively – to Frankfurt-based Merz Therapeutics last week for $185 million. Pearl River-based Acorda Therapeutics, which filed for Chapter 11 earlier this year, postponed the final layoff date of its 97 employees to August 22. Merz Therapeutics, a neurology-focused pharmaceutical company, plans to expand the drugs’ distribution worldwide.
STI TESTING BILL: The New York City Council is expected to pass a bill intended to expand the availability of rapid testing sites for sexually transmitted infections. The bill, sponsored by Bronx Councilwoman Pierina Sanchez, would require the Department of Health and Mental Hygiene to make rapid testing sites available in at least four boroughs, up from the two currently open in Brooklyn and Manhattan, respectively. If the legislation becomes law, the health department would also be mandated to conduct a public education campaign about the new sites and report to the City Council on the availability of rapid testing services.
WORKFORCE FUNDING: The state Department of Health has awarded nearly $5 million to an academic program that aims to increase diversity in the physician workforce, the agency said Wednesday. The funding will go towards the Diversity in Medicine program, an effort run by the nonprofit group Associated Medical Schools of New York to fund mentorship and physician training opportunities at medical schools across the state. The Department of Health’s investment is expected to serve 950 students in 18 programs, the agency said.
WEST NILE VIRUS INCREASING: The New York City Department of Health and Mental Hygiene issued a health advisory on Wednesday warning of the increased prevalence of West Nile virus across the five boroughs. While no human cases have been reported in New York City so far this year, the virus was identified in 325 sets of mosquitoes collected throughout the city. The first such cases were detected on June 5, the earliest the virus has been detected in New York City.
New York’s veteran health tech firms scored a heap of fundraising dollars last quarter as investors focus on bankrolling companies within striking range of turning a profit.
Digital health companies raised $1.3 billion in the second quarter of this year, more than double the funding they raised during the same time last year, according to a report released Tuesday by industry group Digital Health New York.
While investments swelled, the number of deals dropped slightly from 34 in 2023 to 27 this year. But several large funding rounds have offset the decline.
Rather than invest in riskier, early-stage digital health firms like they did during the early days of the pandemic, venture capital firms are making bigger investments in companies that already have a few customers and a product that works. Ninety percent of New York’s digital health funding in the second quarter went to late-stage companies, the report said.
“We are seeing investors be more picky,” said Peter Micca, a partner in life sciences and health care at Deloitte. “Those who make the cut are making larger rounds because they have a path to profitability.”
Investments in digital health firms have slowed in recent years as high interest rates and economic uncertainty have deterred many companies from going public. Funding has started to pick back up and investors have flocked to established startups, some of which may be readying themselves to make an initial public offering or merge with big players as the market improves.
The shift is a sign that the industry is maturing, said Bunny Ellerin, chief executive officer of Digital Health New York, which publishes research on the city’s digital health industry.
“The window is opening up a bit more for larger investments,” Ellerin said. “There is positive momentum.”
More than 35% of all dollars raised by digital health companies in the second quarter went to biotech firms, the report found. Formation Bio, a Midtown East-based startup that uses artificial intelligence to develop new drugs, raised $372 million in the largest deal of the quarter.
Biotech was followed by care delivery platforms and mental health firms. The care delivery and coordination sector raised roughly a fifth of all funds, and fundraising got a boost from larger investments. Sword Health, a Chelsea-based firm that coordinates musculoskeletal care, for example, raised $130 million in June.
Mental health companies raised 17% of all digital health dollars, as companies such as Talkiatry and Grow Therapy raked in $130 million and $88 million, respectively.
Health and financial analysts predicted a wave of mergers and acquisitions within the digital health sector in the early months of this year. Many of the companies that emerged in 2021 focused on individual point solutions that have proven difficult to scale, and analysts estimated that companies would merge to offer more holistic services. There were a few deals, but projections of an uptick in consolidation largely did not come to fruition, Ellerin said.
During the first six months of this year, digital health firms raised a total of $2.2 billion, showcasing an investment trend that Ellerin said was more realistic compared to the exuberance investors exhibited in 2021.
A spate of MTA power outages and switch and signal problems this week have led to longer-than-normal waits at sweltering stations and more-miserable-than-usual summer commutes.
On Monday trains on the A, C and E lines suffered delays in both directions after a loss of power near Canal Street. The MTA said switch problems at 135th Street Tuesday severely disrupted A, C and D trains, and resulted in a suspension of B train service to ease a pile-up of train traffic. A loss of power at Delancey Street-Essex Street Tuesday caused another cascade of issues, and the trouble continued early Wednesday morning with a major slow down of J trains in both directions due to signal problems caused by power loss at the Lower East Side station.
The delays came after MTA chair and chief executive Janno Lieber on Monday mocked New Jersey Transit and Amtrak for recent service disruptions; at a morning press briefing he said “we ain’t New Jersey, we ain't Amtrak” and that “there is no meltdown on this side of the Hudson.”
This week’s subway delays have made for a grueling week of underground travel for riders at some of the system’s 472 stations, most of which lack air conditioning, as temperatures have climbed into the 90s, with a real-feel of up to 103 degrees in some places.
“I felt dizzy and my vision blurred. If I didn’t sit down and drink some water I probably would have fainted,” said Selma Rodriguez, 52, of her Tuesday wait for a 4 train on a crowded platform at the 14th Street-Union Square station. “It felt like my shirt was pasted to my body.”
Others have had the misfortune of stepping onto a subway car and being hit by a wall of hot air. Such was the case for Richard Martin, 42, when he stepped onto a downtown 6 train at 125th Street Wednesday morning; he said he bolted to a neighboring train car at the next station.
“If I’m not traveling far I try to handle it, but it’s too hot for that,” said Martin. “Sometimes you don’t really have a choice when it’s crowded and you gotta get to where you’re going.”
At the beginning of the week MTA officials said they deployed additional teams to more swiftly respond to power outages, track troubles and any equipment issues in machine rooms. Transit workers have also ramped up inspections of subway cars to ensure that they have functional air conditioning. MTA spokesman Mike Cortez said the recent train delays were not heat-related.
Transit officials claim hot subway cars are rare, though you’d be hard pressed to find a commuter who hasn’t found themselves in an oven-like train car. Lieber said on a given day, 99% of the system’s roughly 6,000 subway cars have functioning air conditioning. Straphangers might have a different interpretation of “functioning.”
Irrefutably more common are stifling subway stations. Heat generated by the wheels of subway cars and equipment get trapped in stations and tunnels. Ironically, platforms are made worse because the air conditioning on trains produce heat that is then blasted into stations, said Tiffany-Ann Taylor, vice president for transportation at the Regional Plan Association.
“The subway was not designed to accommodate folks in the type of heat that we’re seeing,” said Taylor. “We kind of have to deal with what we have for the foreseeable future.”
Newer stations, like those along Second Avenue on the Q line, have improved systems and air circulation to keep riders cool. Upgrades at existing stations could help mitigate the heat, but such projects are less of a priority in the wake of an indefinite pause on congestion pricing by Gov. Kathy Hochul, said Taylor.
The MTA had expected the tolling program to generate $15 billion to finance mass transit upgrades. Without the anticipated revenue, transit officials say they now intend to focus on essential upkeep for the region’s subway, buses and commuter rail — the consequences of which could eventually lead to a repeat of 2017’s "summer of hell" for riders.
“We're essentially victims of the system that we have,” said Taylor. “There's very little, in my opinion, that can be done given the age of the infrastructure that we have.”
Mayor Eric Adams agreed with the need for investment in the subway at an unrelated Wednesday news conference. But the mayor, who has said he supports Hochul’s pause on congestion pricing and has long been skeptical of the tolls, didn’t suggest funding alternatives.
“You never want a system that’s old, that needs a lot of capital improvements and repairs,” said Adams. “We don’t want passengers in a hot area waiting, and so we got to continue to look at the multi-billion dollar budget that’s needed to keep this system operating and repaired.”
Some buyers seem willing to take a chance on 432 Park Ave., the supertall condo troubled by alleged construction problems as well as a bitter and long-running lawsuit pitting tenants against developers.
In a sale of one of the last developer-owned units at the 125-apartment Billionaires Row tower, Michael Ostad, a doctor turned real estate lender, has closed on the purchase of No. 37B.
A sizable discount may have helped win him over. The 4,000-square-foot unit traded for $11.3 million, less than its last list price of $12.4 million and almost 40% below the $18.3 million sought in 2014, when the apartment first came up for sale, according to the listing service StreetEasy.
But the condo’s developers, Harry Macklowe and CIM Group, do appear to have removed the listing from the market between 2015 and 2023, the site shows.
Ostad and his wife, Alonna, signed a contract to buy the unit, which has three bedrooms, four and a half baths and three exposures, May 15 and closed the deal June 4, according to the deed, which appeared in the city register Wednesday. Property taxes are about $7,900 a month, while common charges run about $15,000 a month.
Trained as a urologist, Ostad in 2018 switched gears to co-found Flatiron Realty Capital, a firm that services investors who buy houses in Brooklyn and Queens with the intention of flipping them, according to the company’s website and property records.
A phone message left at Flatiron for Ostad was not returned by press time, and Douglas Elliman’s Shari Scharfer Rollins, who marketed the unit, did not reply to an email for comment.
Just one other residential unit appears unsold at 432 Park, No. 29E, which is being delivered as a “white box” and requires a build-out. But the unit, which came to market in 2020 at $7 million and was last asking $5.8 million, went into contract in June, according to StreetEasy.
Its closing will mark the end of a sales period that began in 2013, well before the condo market swooned, Covid created a seesaw of activity and high interest rates took a bite.
(Six other units that appear unsold at 432 Park based on the city register, on the 18th and 20th floors, are in fact offices, according to the building’s offering plan, whose most recent iteration from 2019 anticipated a $3.1 billion sellout.)
Other high-end apartments have of course had difficulty finding takers in the last couple of years, as elevated loan costs have chilled many segments of the residential real estate market.
But 432 Park, a 1,396-foot tower at East 57th Street that was once the city’s tallest residence, has been beset by onsite challenges, including water leaks, nonfunctioning elevators and creaking walls, according to a bombshell 2021 lawsuit brought by disgruntled residents. The suit, which is still being battled over in court, was initially seeking $250 million in damages.
For their part, the developers say they have fixed some of the construction issues and promised that the high-rise is safe, though they have also essentially called the suit an attempted shakedown.
There has been other fallout. Some brokers say they won’t show buyers homes at 432 Park because they don’t want to be blamed if the buyers become unhappy with their purchase, according to a May report in The Wall Street Journal.
Fourteen units at 432 Park are also available as resales, including an 8,200-square-foot penthouse initially listed for $169 million in 2021 that’s now at $105 million, though records show that the seller paid about $88 million for No. 96 in 2016.
Johnson & Johnson’s second-quarter profit beat Wall Street projections on strong pharmaceutical sales, while the company cut its full-year forecast to account for a spate of recent acquisitions.
Adjusted earnings for the quarter were $2.82 a share, the New Brunswick, New Jersey-based company said Wednesday in a statement, beating analysts’ average estimate by 11 cents. While drug sales were slightly ahead and medical device revenue fell a bit short, spending on research and development was below expectations.
J&J’s share price has fallen this year as investors fret about declining sales of Stelara, an anti-inflammatory medicine that will soon face lower-price competition in the US and Europe, and ongoing litigation with people who claim the company’s talc-based baby powder caused their cancers.
“We acknowledge there are a few overhangs,” Chief Financial Officer Joe Wolk said in an interview. “I think we’re very well-positioned to manage that and to grow even in the first year of Stelara losing exclusivity.”
The shares rose 2.7% after US markets opened. J&J had fallen 3.7% this year through Tuesday’s close.
The company said it would generate operational sales of $89.4 billion in 2024, an increase of 6.4% from a year earlier, after its $13.1 billion buyout of the device firm Shockwave Medical. J&J also bought Proteologix Inc. in June and the experimental eczema treatment NM26 from privately held Numab Therapeutics in July.
Because of those transactions, adjusted operational earnings for the year will be $10.05 a share, down from the $10.68 a share midpoint estimate it issued in April, according to a statement Wednesday. The forecast includes a 5 cents per share gain from improved performance, J&J said.
Talc Settlement
J&J has proposed settling the majority of the outstanding talc claims by paying out more than $6 billion over 25 years. Plaintiffs have until July 26 to vote in favor of the deal, and J&J needs the support of at least 75% of claimants to move forward.
The company is “cautiously optimistic” the settlement will go through, Wolk said.
J&J is counting on its medicines for cancer and autoimmune disease to make up for Stelara’s impending decline. Darzalex, a multiple myeloma treatment that’s now J&J’s biggest drug, beat analysts’ projections in the second quarter, as did the psoriasis treatment Tremfya and prostate cancer medicine Erleada.
Last year, J&J split from its consumer health division, which makes Tylenol and Listerine, to focus on the higher-margin pharmaceutical and medical-device businesses. The company, which has spent nearly $35 billion on acquisitions in the last 18 months, will be “opportunistic” in looking for deals to expand its pipeline, Wolk said.
“It’s a luxury I have as CFO that we don’t have to do anything out of desperation,” he said. “We think in terms of years, not necessarily quarters here.”
A meteor roughly the size of a basketball zoomed over Manhattan Tuesday morning and ultimately disintegrated about 29 miles above the greater New York area.
NASA initially estimated the daytime fireball passed over the Statue of Liberty before exploding over midtown Manhattan but has since updated its tracking to suggest the meteor originated over the city before moving west into New Jersey at about 38,000 mph.
Those estimates remain "very crude and uncertain," NASA said.
NASA characterized the object as a "small rock" about a foot in diameter. A meteor that size is incapable of making it all the way to earth's surface, NASA said.
"We do not (actually cannot) track things this small at significant distances from the Earth, so the only time we know about them is when they hit the atmosphere and generate a meteor or a fireball," NASA wrote in a Facebook post. "Also, NASA watches the natural stuff; the Department of Defense keeps track of satellites and orbital debris."
People from Brooklyn to Staten Island reported hearing a loud bang around the time the fireball passed over the city, though there has been no official confirmation tying those sounds to the meteor. "There are reports of military activity in the vicinity around the time of the fireball, which would explain the multiple shakings and sounds reported to the media," NASA wrote.
Leases
Columbia trustees moving to Sixth Avenue
Address: 1177 Sixth Ave., Manhattan
Landlord: Silverstein Properties
Tenant: The Trustees of Columbia University
Lease size: 15,375 square feet
Asset type: Office
Brokers: Cushman & Wakefield's Mark Weiss and Keaton McCann represented the tenant. Cushman & Wakefield's Bruce Mosler, Lou D'Avanzo, Ethan Silverstein, Anthony LoPresti, Peter Kerans and Caroline Collins represented the landlord, along with Joseph Artusa, Keith Cody, Harlan Strader III and Gordon Hough in house.
ATCO Properties lands renewal on Fifth Avenue
Address: 555 Fifth Ave., Manhattan
Landlord: ATCO Properties & Management
Tenant: Telsey Advisory Group
Lease size: 6,829 square feet
Asking rent: $63 per square foot
Asset type: Office
Brokers: Kate Hemmerdinger Goodman represented the landlord in-house.
Sales
Midtown office-to-hotel project 1 Hotel Central Park changes hands
Address: 1414 Sixth Ave., Manhattan
Seller: Starwood Capital Group
Buyer: Host Hotels & Resorts
Sale price: $233.8 million
Asset type: Hotel
Read more about the deal here.
Upper East Side condo tower unloads storefront to Spanish firm
Address: 200 E. 83rd St., Manhattan
Seller: Naftali Group
Buyer: Azor Exan Management
Sale price: $8.6 million
Asset type: Retail
Financings
SoHo office building gets hefty loan
Address: 114 Crosby St., Manhattan
Owner: Chelsfield Group and RAM Holdings
Lender: Maxim Capital Group, Sabal Investment Holdings and GDS Brightstar
Loan amount: $50 million
Asset type: Offices
Read more about the deal here.
A recently renovated boutique office building in SoHo has landed a $50 million loan, the lenders have shared with Crain's.
Manhattan-based mortgage lender Maxim Capital Group, together with Sabal Investment Holdings — an investment management firm headquartered in California — and GDS Brightstar, the financing arm of Manhattan-based real estate firm GDSNY, closed this week on the $50 million loan for 114 Crosby St. The financing provides capital to allow for new tenants to move into the Class A property and outfit the space to feet their needs.
The 12-story cast-iron building between Prince and Jersey streets was recently renovated by Chelsfield Group, a London-based developer, and RAM Holdings, which purchased the property for $55 million in 2022. The roughly 144,000-square-foot, all-electric building, which has an alternative address at 580 Broadway, also boasts a private roof terrace for tenants with views of Manhattan's skyline.
Securing such a hefty loan amid the city's ailing office market, which has struggled to bounce back from the pandemic, is a sign of how "well-designed" and "desirable" the building is, said Jason Bordenick, a partner at Maxim Capital Group.
Since leasing kicked off last summer, more than half of the Crosby Street building has been filled — although Julie Fornaro, a spokeswoman for Sabal Investment Holdings, declined to say what percentage remains vacant.
One of those recent lease signings was by Canadian luxury outdoor apparel company Arc'teryx, which inked a deal for 14,400 square feet on the ground and lower-level floors of the building. In addition to the retail space, Arc'teryx will soon open a flagship coffee shop in the space— a new concept it appears the apparel company first started at one of its retail stores in Japan.
Fornaro declined to disclose the details of the apparel company's lease, such as the length or cost per square foot, but according to a recent report from commercial broker JLL, the average asking rent for a ground-floor retail space in SoHo went for $281 per square foot during the first quarter of this year.
EssilorLuxottica SA agreed to buy the streetwear label Supreme from VF Corp. for $1.5 billion in cash, adding another lifestyle brand to the French-Italian eyewear company’s stable that already includes Ray-Ban and Oakley.
Streetwear is a surprising choice for EssilorLuxottica, which was formed from the merger of two of Europe’s most prominent eyewear companies — Italy’s Luxottica and France’s Essilor. For VF, selling Supreme will allow the company to simplify its business and raise cash to pay down debt.
“As a near-luxury brand, Supreme never fit with the rest of VF’s brands that well,” said David Swartz, a senior equity analyst at Morningstar. Selling it for $1.5 billion is a “decent outcome” for VF, he said.
EssilorLuxottica shares fell as much as 5.3% Wednesday in Paris, trimming their year-on-year gain to 8%. VF shares were up 6.2% in New York trading at 9:37 a.m. They had fallen 24% this year through Tuesday’s close.
Supreme was founded in New York by James Jebbia in 1994, selling clothes and footwear targeting skateboarding and urban trends. It has moved from being a cult favorite, with its distinct red and white logo, to a mainstream success and now has an online business as well as 17 stores in the US, Asia and Europe.
Jebbia said he supports the sale to Essilor as it will allow Supreme to focus on its brand, products and customers.
VF acquired Supreme in 2020 as part of a $2.1 billion deal with private equity firm Carlyle Group and investors including Goode Partners. Supreme’s growth has been fueled by so-called “hype” marketing, including limited-edition collaborations with partners ranging from watchmakers to musicians, and frequent “drops” of new products. Among others, it has tied up with Louis Vuitton and The North Face.
Meanwhile, EssilorLuxottica is a global leader in the production and sale of prescription eyeglasses, sunglasses and contact lenses.
“What will make this a synergistic acquisition for EssilorLuxottica does not seem obvious to investors,” James Grzinic, an equity analyst at Jefferies, wrote in a research note.
Separately, EssilorLuxottica also said it’s buying a majority stake of 80% in Heidelberg Engineering — a German company that specializes in diagnostic solutions, digital surgical technologies and health-care IT for clinical ophthalmology.
That agreement will boost EssilorLuxottica’s medical technology business, which sits alongside the fashion-focused arm selling sunglasses and accessories.
Mitchell Modell’s sporting goods chain was an early casualty of the pandemic. A small Midtown office building he acquired months before the world locked down isn’t doing any better.
The building at 22 W. 38th St. is to be sold at auction after lenders foreclosed on the 70,000 square-foot property that Modell and a partner bought in 2019 for $61 million. No auction date has been set, court records indicate, but Judge Melissa Crane ordered one be held within 90 days of her June 10 order.
It’s the latest piece of grim news for Modell. His retail business, with its inimitable “Gotta go to Mo’s” jingle, filed for bankruptcy in March 2020 and closed all 141 stores. Three months ago Modell, who was CEO, along with his company’s former CFO and other parties, agreed to pay $22.7 million to settle claims by a liquidation trustee that accused the Modell family trust of collecting millions in shareholder distributions while the company was insolvent.
Modell teamed up with the Brodsky family’s BEB Capital to acquire the 12-story 22 W. 38th in June 2019. Previous owner Dalan Management had bought the property in 2015 for $43 million and invested $5 million in gut renovations. When Modell and his partner struck their unfortunately timed deal the building was 100% occupied, with half the space leased to office co-working firm Knotel at about $50 per square foot, according to bond-rating firm KBRA.
Knotel moved out after filing for bankruptcy in 2021 and hasn’t been replaced. In February 2023 Modell defaulted on the $35 million mortgage and foreclosure proceedings began last July. BEB Capital isn’t a party to the proceeding. The building was an investment property for Modell; his business headquarters was in another location. On Tuesday, Moody’s downgraded a security holding the mortgage for 22 W. 38th St.
An attorney for Modell, Emilie Cooper, didn’t immediately respond to a request for comment.
In recent weeks, Mayor Eric Adams' administration has doubled down on the argument that New York City has one path forward to address a debilitating housing crisis. That path, adherents say, is to tweak zoning rules to make denser residential development an option in more of the city. Reports of rising rents in all five boroughs have been accepted as de facto evidence of a very specific emergency – a three-alarm “lack of supply” fire that only the cooling waters of “City of Yes for Housing Opportunity” plan can bring under control.
Opponents of the administration’s proposals object to their lack of affordability standards and anti-displacement protections. They are skeptical of the “enable private supply” theory of affordability. But the most troubling thing about the City of Yes conversation is the implication that zoning liberalization gets the city where it needs to be on affordable housing generation. Zoning monomania – tied to officials’ determination to deliver market opportunities to developers and investors – is hijacking conversation about credible alternative responses. Two policies in particular would go further than upzoning in alleviating ordinary New Yorkers’ housing stress.
Universal housing vouchers
Sociologist Matthew Desmond ends his acclaimed book Evicted with a call to furnish all households unable find housing they can afford with vouchers that subsidize them up to a “fair market rent.” Vouchers are a demand-side, not a supply-side policy. But vouchers would prevent evictions, slim down the wildly expensive (and miserable) temporary shelter system and deliver income to people who currently spend a mind-numbing proportion of their earnings simply to remain housed. A well-administered universal voucher program would create competition among providers, improve housing quality, and stabilize prices. It could even induce new moderately priced supply (as opposed to new market-rate supply with a few affordable units tacked on).
The City Council has attempted to get more so-called CityFHEPS vouchers into circulation. But the Mayor is resisting. Moreover, Adams has done nothing to advocate in Albany for state-level voucher legislation.
Social housing preservation
Preservation is another means to avert the crisis. Homes operated by the New York City Housing Authority (NYCHA) are a critical social infrastructure. But cumulative, decades-long lack of attention to NYCHA capital needs is putting thousands of apartments at risk – and making current residents sick, whether from toxic mold or inadequate protection from extreme heat. Congresswoman Alexandria Ocasio-Cortez recently re-introduced legislation that would fund the upgrading and decarbonization of public housing around the country. With these resources, NYCHA and its peers in New York State could make thousands of units livable, reduce their carbon footprint, and supply 15,000 new units – over 10% of the new stock projected from the City of Yes zoning amendments.
Similarly, the city’s stock of rent-regulated low- and moderate-cost private housing is decaying as many owners choose to take cash out of buildings rather than maintain them. The city’s Department of Housing Preservation and Development and a raft of non-profit partners are working to acquire and renovate distressed buildings. But city capital allocations are deeply inadequate. Talk of how best to finance city-sponsored preservation (or state-sponsored preservation and new construction through a proposed Social Housing Development Authority) is sidelined as City of Yes proposals consume political oxygen.
Vouchers and social housing would require fiscal re-prioritization: more up-front resources to government agencies and mission-driven organizations, less foregone tax revenue, and possibly tax increases. But pursuing these policies would yield savings too, for example by reducing massive spending on emergency shelter. New Yorkers need the Adams administration to pull all possible levers (federal, state and municipal) in response to the housing crisis. Leaders should not allow zoning monomania to stand in for a comprehensive affordable housing strategy.
Laura Wolf-Powers is a Professor of Urban Policy & Planning at Hunter College, CUNY.
Barry Sternlicht's Starwood Capital Group has closed on selling its "eco-luxury" Midtown hotel to a Bethesda, Maryland-based real estate investment trust for about $234 million. The deal is another sign of strength for the city's hospitality sector.
Host Hotels & Resorts has purchased the former Starwood hotel at 1414 Sixth Ave., known as 1 Hotel Central Park, according to property records. Host Hotels bills itself as "the world's largest publicly traded lodging REIT," and its portfolio includes the New York Marriott Marquis in Times Square and the New York Marriott Downtown in the Financial District.
Representatives for Starwood and Host Hotels did not respond to requests for comment by press time.
Starwood purchased the site, located just steps from Central Park at Sixth Avenue and West 58th Street, for $72 million in 2011, property records show. The company opened its hotel at the address in 2015 and explored a sale of the property in 2016, although a deal did not come through.
The hotel stands 18 stories tall with 234 rooms, according to the commercial real estate database CoStar. Rates ranged from $755 per night for a room with one queen bed to $5,255 for a two-bedroom suite as of Wednesday morning.
The 1 Hotel brand focuses on sustainability, and the property at Central Park includes amenities such as a farm-to-table restaurant and an in-house electric car that guests are free to test drive. The brand has a Brooklyn location as well, at 60 Furman St. in Brooklyn Heights.
This is at least the second 1 Hotel property that Starwood has recently sold to Host Hotels. The real estate investment trust bought the 1 Hotel in Nashville, along with the city's downtown Embassy Suites, from Starwood, Crescent Real Estate and High Street Real Estate Partners earlier this year for about $530 million, according to announcements from the firms.
The city's hotel industry struggled mightily during the pandemic, with many properties selling for fractions of what they had gone for in pre-Covid years. And though it has come roaring back in recent months, some in the real estate industry have attributed the rebound at least partly to government interventions aimed at housing the influx of migrants and cracking down on illegal short-term rentals.
Ares Management Corp. is expanding its offices at a building near Manhattan's Grand Central Terminal, an area that has become a magnet for Wall Street's biggest players.
The alternative asset manager will occupy the top eight stories of 245 Park Ave., a tower owned by SL Green Realty Corp. and a Mori Trust Co. affiliate, according to an Ares spokesperson. The new lease adds three floors to the firm's current footprint, providing offices for about 1,150 Ares staff, up from the 698 workers in the building as of May 31.
"We are excited to retain our Park Avenue office location," said the spokesperson for Ares, which oversaw $428 billion as of March 31. "We see great value in supporting an environment that is conducive to in-person collaboration."
Park Avenue near Grand Central has emerged as one of the most sought-after US office submarkets, even as space demand in general lags behind pre-pandemic levels. JPMorgan Chase & Co.'s new headquarters tower is under construction in the Midtown neighborhood, and Ken Griffin's Citadel has plans for a 62-story skyscraper nearby. Blackstone Inc. is adding to its space at 345 Park Ave.
Asking rents in Midtown averaged $83.54 a square foot in June, compared with the average for Manhattan of $77.65 a square foot, CBRE Group Inc. reported.
NEW REPORTER: The Health Pulse team at Crain’s New York Business welcomes Ethan Geringer-Sameth as its newest health care reporter. Geringer-Sameth will be covering health care business stories across New York City and state. Send tips or say hi at ethan.geringersameth(at)crainsnewyork(dot)com.
WEST NILE VIRUS MITIGATION: The New York City Department of Health and Mental Hygiene will spray pesticides in parts of Queens today between 8:30 p.m. and 6 a.m. tomorrow morning as part of an effort to reduce the adult mosquito population and the accompanying risk of West Nile Virus. The treatment, which will use low concentrations of the pesticides Anvil 10+10, Duet, or MERUS 3, follows a previous round of larvacide earlier this month as mosquito-borne illnesses, like dengue fever, are on the rise.
HOUSE CALL PROGRAM: Northwell Health’s Lenox Hill Hospital opened a new office space for its house calls program, which serves more than 600 homebound patients in the New York City region, the health system said Tuesday. The 2,800 square-foot space includes eight offices for 12 physicians, nurses, social workers and administrative staff, as well as a space for meetings with caregivers. The new workspace was funded by a $1 million donation from Jeannette Rosen and her husband Jonathan Rosen, who is a patient of the program, as well as additional donations from the Auxiliary of Lenox Hill Hospital and the Lenox Hill New Leadership Council.
Shares of BuzzFeed closed higher on Tuesday after the founding family of U.S. homebuilder PulteGroup disclosed an activist stake in the struggling media company.
The Pulte family threw its weight behind former Republican presidential candidate Vivek Ramaswamy, the online platform’s second biggest shareholder, saying that it supported the changes he is seeking from its management.
“In our opinion, the current BuzzFeed CEO Jonah Peretti is driving the company into the ground, and when Vivek Ramaswamy gave him a life boat to save his sinking ship, Peretti told him thanks anyway,” Pulte Capital Partners Chief Executive Officer William J. Pulte said in a statement posted on X.
BuzzFeed shares closed 5% higher after spiking up as much as 28% during the session.
The family’s current stake is less than 1% but may rise in “the days and weeks ahead,” their spokesman told Bloomberg in an email.
Ramaswamy, who has steadily raised his position to about 9% since disclosing his holding in BuzzFeed late May, has called for management to implement sweeping job cuts and feature more conservative voices on the platform. He also wants the board to add conservative-leaning nominees Chris Balfe, Patrick Bet-David and Clay Travis.
Pulte said his family was not working with Ramaswamy and did not inform the entrepreneur before purchasing BuzzFeed shares.
BuzzFeed has more than $100 million in debt and is trying to find a buyer for its food-oriented arm that produces popular YouTube-based talk show Hot Ones.
Ozy Media and CEO Carlos Watson were found guilty of defrauding investors in a case featuring allegations Watson coached his co-founder to impersonate a YouTube executive to get Goldman Sachs bankers to back the media startup.
A jury delivered its verdict on the former TV host and Ozy Media Tuesday in Brooklyn federal court following a six-week trial. Watson was immediately taken into custody after his bail was revoked by the judge.
The company and Watson, 54, were convicted of conspiracy to commit wire fraud and securities fraud, while Watson was also convicted of aggravated identity theft. Watson faces as long as 37 years in prison when he’s sentenced, prosecutors have said, but he is unlikely to get a term that long. The judge set sentencing for Nov. 18.
Prosecutors accused him of obstruction of justice, perjury and other misconduct after he was charged and during the trial. He allegedly helped create a documentary that he advertised in the New York area and elsewhere that the government said could have biased the jury.
His attorneys said in a statement they’re disappointed with the verdict and plan to appeal immediately.
Ozy, a once-lauded media startup based in Mountain View, California, and backed by Marc Lasry, collapsed shortly after the New York Times reported on the impersonation in 2021 and the startup’s business practices came under sharp scrutiny.
Prosecutors alleged that Watson hatched a scheme to con investors out of tens of millions of dollars by lying about Ozy’s revenue and staging the deceptive phone call with two bankers at Goldman Sachs Group Inc. to raise funds. Watson was also accused of falsely telling an investor his startup had received a $600 million takeover offer from a large tech firm.
“Watson knew the company was failing, but he was determined to turn Ozy and himself into the next big thing, and he wasn’t going to let the truth stand in his way,” U.S. Assistant Attorney Gillian Kassner said during her closing arguments on Wednesday.
Watson’s lawyer, Ronald Sullivan Jr., argued that the government was going after the wrong person.
“This case is about a crooked co-founder Samir Rao who lied, undermined and betrayed Mr. Watson,” he said during his closing statement to the jury.
Rao testified against Watson after agreeing to plead guilty, as did Ozy’s chief of staff, Suzee Han.
Rao told the jury that Goldman Sachs had agreed to invest $35 million in the startup, but asked to hear from clients like YouTube. He testified that to fool the bankers into thinking the company was profitable, he took his cues from Watson on what to say when he pretended to be YouTube executive Alex Piper during a February 2021 conference call. Both immediately realized their plan failed catastrophically, Rao said.
In their own testimony, the Goldman bankers said the deal collapsed after they heard a “surreal” voice on the call. Rao said he had used a voice-altering app to disguise his voice. Goldman reached out to the real Alex Piper, who phoned Rao and demanded an explanation.
Watson took the witness stand for several days to defend himself. He denied wrongdoing and any involvement in the staged Goldman phone call.
During cross examination, Watson was asked by a prosecutor why he didn’t fire Rao after the Goldman call. He replied that Rao was put on suspension and said under questioning from his own attorney that he didn’t have the power to terminate his co-founder.
Ozy’s board of directors removed Rao from the board after the Goldman call.
The case is US v. Watson and Ozy Media Inc., 23-cr-82 US District Court, Eastern District of New York (Brooklyn).
City Comptroller Brad Lander is urging major pharmaceutical retailers to start filling prescriptions for the abortion pill – or else risk backlash from investors including the city's pension funds.
Lander sent warning letters to Walmart, Kroger, Costco, Albertsons and McKesson – which own Safeway and Health Mart, respectively – on Monday pressing them to start filling prescriptions for mifepristone, one of the drugs used to terminate early pregnancies, in the states where it’s legal. The companies’ decision not to sell the pill puts them at a competitive disadvantage to retailers that dispense it, including CVS and Walgreens, Lander said.
The comptroller oversees approximately $270 billion in investments from the city’s five pension funds. The funds own shares worth $1.3 billion in all five pharmaceutical retailers, according to the comptroller’s office.
New York City's pension funds own roughly $525 million in Walmart stock, $444 million in Costco, $190 million in McKesson, $117 million in Kroger and $15 million in Albertsons.
“By failing to become certified mifepristone dispensers, these pharmacy giants put both women’s reproductive health care and investors' money at risk,” Lander said in an emailed statement to Crain’s. He advised the companies to follow peers CVS and Walgreens, which moved to start selling the abortion pill earlier this year.
The pharmaceutical giants’ failure to publicly commit to selling the abortion pill “raises significant investor concerns'' about their responsiveness to a growing market opportunity, ability to stave off potential reputational risks and commitment to “maximizing sales and long-term shareholder value,” Lander said in the letters, shared exclusively with Crain’s. Medication abortion now accounts for 63% of all abortions in the health care system, he said.
Representatives from Walmart, Kroger, Costco, Albertsons and McKesson did not respond to a request for comment by publication time.
Mifepristone has not always been available for sale in pharmacies. Despite a low-risk profile, the drug has long been subject to strict federal regulations, which previously required it to be dispensed to patients in-person by a health care provider.
The U.S. Food and Drug Administration loosened the dispensing rules for mifepristone last January, which allowed the pill to be distributed in pharmacies and via telemedicine. That regulatory changed spurred some pharmacies to get certified to dispense the drug, but several major retailers have yet to follow suit.
Now, pharmaceutical retailers face increasing public pressure to offer the abortion pill as courts continue to hear legal challenges threatening to undermine access to the drug. Last month, the U.S. Supreme Court unanimously struck down a case attempting to roll back federal approval of mifepristone, stating that the anti-abortion physician group that brought the challenge didn’t have the grounds to file it.
The Supreme Court ruling sparked calls from elected officials to improve access to the abortion pill by getting it into more pharmacies nationwide. More than 50 U.S. Representatives, including New York Rep. Dan Goldman, sent their own warning letters to Walmart, Costco, Kroger and the owners of Safeway and Health Mart pressing them to sell the abortion pill earlier this month.
U.S. Sen. Bob Menendez, the once-powerful New Jersey Democrat, was found guilty of bribery, extortion and acting as a foreign agent of Egypt after a corruption trial focused on 13 gold bars, nearly $500,000 in cash and a Mercedes-Benz seized at his home.
A jury convicted Menendez on all 16 counts against him Tuesday after a two-month trial in New York federal court, where prosecutors claimed the lawmaker sold his influence to protect businessmen and promote Egypt’s interests. Menendez, who faces as many as 20 years in prison on the most serious counts, showed no emotion as the jury foreperson said “guilty” again and again.
Prosecutors argued that Menendez’s wife, Nadine, was a key go-between who collected bribes and set up meetings with the businessmen and Egyptian officials. She was also charged, but will face a later trial.
“Senator Menendez must now do what is right for his constituents, the Senate, and our country, and resign,” Senate Majority Leader Chuck Schumer said after the verdict.
If Menendez doesn’t resign, the Senate could move to expel him. No senator has been expelled since the Civil War, though many have resigned under pressure from party leaders. If Menendez leaves, New Jersey Governor Phil Murphy, a Democrat, would appoint a replacement until Menendez’s term ends on Jan. 3.
Outside the courthouse, Menendez said he was “deeply disappointed” and that he expects to succeed on appeal.
“I have never violated my public oath, I have never been anything but a patriot of my country and for my country,” Menendez said. “I have never, ever been a foreign agent and the decision rendered by the jury today would put at risk every member of the U.S. Senate in terms of what they think a foreign agent would be.”
The three-term senator was the first member of Congress convicted of being a public official acting as a foreign agent. He was also found guilty of bribery, extortion, conspiracy, honest services wire fraud and obstruction of justice.
Menendez, the senior Hispanic lawmaker in Congress, saw his political support vanish in Washington and New Jersey amid the publicity of the cash, gold and the Mercedes convertible seized by the FBI from his home in 2022. Following the indictment, he resigned as chairman of the Senate Foreign Relations Committee.
In the courtroom, one of Menendez’s lawyers patted him on the shoulder as the verdict was read. The judge set a sentencing date for Oct. 29 for Menendez and two co-defendants convicted with him, Fred Daibes and Wael Hana. Like Menendez, Daibes and Hana are expected to appeal.
Prosecutors said Menendez corruptly helped Egypt secure U.S. military aid and sensitive information; urged a U.S. agriculture undersecretary to stop questioning Hana’s halal monopoly; weighed appointing a U.S. attorney in New Jersey who would influence a 2018 fraud indictment of Daibes; contacted the New Jersey attorney general to disrupt New Jersey criminal probes of two people close to Uribe; and helped Daibes arrange financing from a Qatari investment fund for a real estate project.
‘All that power’“This case has always been about shocking levels of corruption,” U.S. Attorney Damian Williams said in a statement after watching the verdict in the courtroom. “This wasn’t politics as usual; this was politics for profit. Because Senator Menendez has now been found guilty, his years of selling his office to the highest bidder have finally come to an end.”
The bribes began when Menendez, 70, started dating Nadine Arslanian in 2018, just after an earlier corruption trial against him ended in a hung jury, prosecutors said. They wed in 2020.
At the trial, jurors held the gold bars stashed in the Menendez house, heard about their tumultuous relationship, and watched a secret FBI video of the couple dining at a Morton’s steakhouse with an Egyptian intelligence official. A third businessman, former insurance broker Jose Uribe, pleaded guilty and testified he bribed Arslanian with a Mercedes.
Menendez didn’t testify but denied wrongdoing. His lawyers said he took no bribes or official actions to advance any quid-pro-quo schemes. His attorney Adam Fee derided the U.S. case as “painfully thin,” woven from “fantasy” speculation and misguided inferences.
Cash in closetsDefense lawyers sought to defuse the explosive heart of the case — gold bars and cash stuffed in closets, boots, jackets, a safe and a shopping bag. Using fingerprints and DNA evidence, prosecutors traced $82,500 of cash-stuffed envelopes to Daibes.
Serial numbers on two one-kilogram gold bars, valued at about $60,000 each, matched those on a list Daibes kept. Daibes, who grew up in a Palestinian refugee camp, gave other kilogram bars to Nadine Menendez, who sold all but two before the FBI raid, the US said. Defense lawyers said she inherited gold bars from her Lebanese family, and there’s no proof the gold she sold came from Daibes.
Fee said Menendez’s Cuban immigrant parents hoarded cash, and that the senator routinely withdrew $400 for decades from a bank account. He also argued Daibes had been friends with Menendez for 30 years, and he gave gifts out of friendship, not corrupt intent.
Jurors heard Arslanian was mesmerized by Menendez when they began dating, calling him “mon amour” in gushing texts. She and Hana set up meetings with Egyptian officials even as she faced foreclosure on her mortgage and struggled to pay for a new car after totaling a Mercedes when she struck and killed a pedestrian. Prosecutors said Hana gave her a no-show job and paid her mortgage, both as bribes.
Uribe, the cooperating witness, testified he gave her $15,000 in cash in a diner parking lot as a down payment on a new car, and made monthly payments for almost three years. He pushed Arslanian to prod Menendez to contact New Jersey’s attorney general at the time, Gurbir Grewal, to urge him to drop the insurance fraud indictment of an associate.
Serial LiarDefense lawyers grilled Uribe, seeking to show he was a serial liar who shouldn’t be trusted.
Grewal testified that Menendez called him in January 2019, and met with him eight months later, to complain about insurance fraud investigations of Hispanic truckers.
“Menendez is smart, Menendez is careful,” prosecutor Paul Monteleoni said in his summation. “He wasn’t foolish enough to tell Grewal you need to kill this case.” Instead, Menendez “used a fake claim of discrimination as a tactic because that is a serious accusation, one that could get a case dismissed,” and it gave him deniability “if anyone ever accused him of improperly pressuring Grewal,” the prosecutor said.
The case is US v. Menendez, 23-cr-490, US District Court, Southern District of New York (Manhattan).
Mayor Eric Adams expresses frequent pride in the number of women he has elevated to senior roles in his administration. But several of those appointees have departed under murky circumstances in the past year, reflecting the continued difficulties those leaders face — especially in male-dominated departments.
Fire Commissioner Laura Kavanagh, the first woman to lead the FDNY in its 159-year history, announced plans Saturday to step down after about two years on the job. She said only that it was “time for me to pass the torch,” but Kavanagh had faced lawsuits from multiple former chiefs alleging they were demoted and discriminated against due to their age. She reportedly dealt with discontent in City Hall about her handling of an incident when rank-and-file firefighters booed state Attorney General Letitia James at a ceremony.
Kavanagh’s plan to resign once a successor is named comes weeks after the May 31 exit of Sylvia Hinds-Radix, the corporation counsel. Hinds-Radix’s resignation as the city’s top lawyer stemmed from disagreements with the mayor’s office over whether city lawyers should represent top Adams aide Timothy Pearson in a sexual harassment suit against him, Politico reported this month.
And last June, Keechant Sewell resigned after a year and a half as the city’s first female police commissioner, amid reports that she had clashed with City Hall over her desire to discipline a police official friendly with the mayor. Adams’ management structure allowed Phil Banks, the deputy mayor for public safety, to meet with NYPD chiefs in Sewell’s absence, The City reported.
Asked on Tuesday whether those female leaders had been set up to succeed, Mayor Adams flipped the script, arguing that it was “sexist” to question whether they had been given the support they needed.
“A man leaves, we don’t say, ‘You didn’t give the man the support,’” Adams said at a weekly press conference. “She wants to do something else with her life, like the men that left wanted to do something else with their lives.”
“Right now, Commissioner Sewell is over at the New York Mets, and she’s making a heck of a lot more money,” Adams added, referring to Sewell’s new job running security at Citi Field. “I’m really proud of both of them, that we broke boundaries.”
Christina Greer, an associated professor of political science at Fordham University, said female appointees may have been bound to struggle at the overwhelmingly male agencies.
“Institutions like the NYPD and FDNY, paramilitary organizations that aren’t accustomed to female leadership, it’s like, was it a setup from the beginning? Is this ever going to be a fit?” Greer said.
But while Sewell’s resignation seemed closely tied to City Hall’s leadership structure, Greer argued that Kavanagh’s appeared more routine, given the demanding nature of the Fire Department job.
“This to me seems like kind of the natural progression of people leaving certain administrations,” she said. “I wouldn’t frame it as a gender exodus.”
Indeed, Adams maintains many women in senior leadership roles, including five of his seven deputy mayors: Maria Torres-Springer, Meera Joshi, Anne Williams-Isom, Ana Almanzar and Sheena Wright, the first deputy mayor.
“If you don't look behind my role and see the women who are really running this city, you're going to miss this moment,” the mayor said at an event celebrating Women’s History Month in March.
But Kavanagh faced widely reported hurdles in her tenure at FDNY, where she spent five years as first deputy commissioner before taking over as acting commissioner in February 2022. A California native and former campaign operative, she had never served as a firefighter herself — something her critics frequently noted — and faced early pushback when she shook up the ranks of senior chiefs, according to multiple reports.
In her tenure, Kavanagh pushed for tighter regulations on lithium-ion batteries after a spate of fatal fires, and was in attendance this month when Gov. Kathy Hochul signed a bill that restricts how the batteries can be sold.
Mayor Adams demurred when asked Tuesday whether Kavanagh had faced sexism in the department, and would not say whether he wants Kavanagh’s successor to have firefighting experience.
“I look forward to spending the next several months assisting the department's transition in leadership, before embarking on my next professional challenge,” Kavanagh said in a statement over the weekend.
Fallout from the Change Healthcare cyberattack continues to affect UnitedHealthGroup, with the health care giant nearly doubling its estimates of how much the incident will financially disrupt business operations this year.
High Medicaid and Medicare Advantage medical expenses contributed to high costs in the second quarter, executives said during a Tuesday earnings call.
The company's second-quarter net earnings declined 23% year-over-year to $4.2 billion, or $4.54 per share. It reported revenue of $98.9 billion, a 6.5% increase from the year-ago period.
UnitedHealth disclosed in February that hackers breached its Change Healthcare payment processing platform, disrupting the flow of health and financial information between payers and providers across the industry. The company anticipates the breach could cost up to $2.45 billion in 2024, or up to $2.05 per share after tax.
Part of the estimated expenses come from anticipated business disruption impacts, which reflect revenue loss and maintenance costs. UnitedHealth nearly doubled those projections to up to $0.70 per share, from up to $0.40 per share previously.
The incident's total impacts in the second quarter were $858 million, or $0.92 per share.
About $776 million of the costs stemmed from direct response actions, including network restoration expenses and costs for preparing consumer notices, President and Chief Financial Officer John Rex said on the call.
“We were a little optimistic, in hindsight, of the pace of which providers would come back on and get claims flowing through the system once reconnected,” CEO Andrew Witty said during the call.
The company plans to alert consumers this month about whether their personal health or financial information was exposed in the attack. OptumInsight, the company’s revenue cycle management division that houses Change Healthcare, also reported $334 million in lost revenue this quarter because of the hack.
The company aims to make up the Change Healthcare losses this year, Rex said.
“Our ambition is to get back to baseline expectations for [Change Healthcare] in 2025,” Rex said. “Clearly, in this quarter the impact of business disruption increased but we’re pacing to get those revenues back.”
As part of its Change Healthcare response, UnitedHealthcare paused prior authorizations for clinicians through April 15, Brian Thompson, CEO of the company’s insurance arm, said during the call. UnitedHealthcare saw an increase in billing for inpatient stays versus observations stays, he said. The pause on some utilization management services led to $290 million in costs this quarter.
UnitedHealthcare has reinforced its prior authorization and other medical management protocols in response, he said.
The company’s medical loss ratio reached 85.1%, compared with 83.2% during the same time last year. MLR represents the percentage of premiums insurers spend on medical care. UnitedHealth also said a regulatory action regarding its South American operations contributed to growing medical expenses. The insurer plans to report an MLR of 84.8% for the full-year of 2024, Rex said during the call.
The company's U.S. insurance membership declined 4.4% year-over-year to 50.4 million, fueled by losses sustained during Medicaid redeterminations. A mismatch between state reimbursement for Medicaid enrollees and individuals' health care expenses drove up UnitedHealth's Medicaid costs during the quarter, Witty said. He anticipates the funding disruption to subside in the second half of the year as local officials update managed care companies' pay.
The company’s 7.7 million Medicare Advantage membership — which includes a large, undisclosed number of patients dually eligible for Medicaid and Medicare — also grew medical costs, Rex said. The insurer is the largest Medicare Advantage carrier by membership, and its number of enrollees grew 2.4% year-over-year. In its bids to regulators filed last month, UnitedHealthcare assumed that care patterns and membership mix would remain stable for 2025. The company reiterated its plan to grow at the Medicare Advantage market rate next year and said it structured its offerings accordingly.
"We took a balanced approach to provide as much stability for seniors as possible amid funding cuts," Witty said.
The company did not directly comment on the Federal Trade Commission's preliminary report last week that found pharmacy benefit managers' business practices led to increased drug prices and squeezed independent pharmacies' profit margins. UnitedHealth operates OptumRx, the third-largest PBM in terms number of prescriptions processed, according to Drug Channels Institute. It also did not address media reports that regulators plan to sue PBMs over insulin prices.
UnitedHealth Group’s stock opened at $533.90 on the New York Stock Exchange, up 3.6% from the market close Monday. The company lowered its full-year earnings outlook to $15.95 to $16.40 per share, from $17.60 to $18.20 per share.
This story first appeared in Modern Healthcare.
JPMorgan Chase & Co. is in contract to purchase a Manhattan building near its new headquarters for more than $300 million.
The bank agreed to buy the office tower at 250 Park Ave., in partnership with Hines, from seller AEW, according to a person familiar with the matter who asked not to be identified citing private information. Bloomberg News reported in June that the bank was close to a deal for the building.
The deal has not yet closed. A team of Newmark Group Inc. brokers led by Adam Spies and Doug Harmon is handling the sale process. Spokespeople for JPMorgan and Hines declined to comment. Representatives for AEW and Newmark didn’t respond to requests for comment.
With the deal, JPMorgan will expand its presence on Park Avenue, where the bank has been building a 1,388-foot (423-meter) tower for its new headquarters. The bank tore down its previous building.
The landlord for the famed immersive theater production Sleep No More has filed to dismiss the show's lawsuit against it, adding yet another wrinkle to an already complex legal fight between the two.
Midtown-based Centaur Properties, which runs the McKittrick Hotel in Chelsea, where Sleep No More has long performed, had sued to kick it out of the building, located at 530-542 W. 27th St. near the High Line, in March. The firm claimed Sleep No More was violating the city's administrative code and putting its guests at risk by operating without a public assembly permit, which deals with issues including fire prevention and seating plans.
The landlord sued once again later that month, this time claiming the production owed it more than $2 million in back rent.
Sleep No More then struck back with a lawsuit of its own in April, arguing that Centaur, run by Harlan Berger, was trying to sabotage the show to cover up its own financial problems. Berger's attorneys recently filed to dismiss this lawsuit, arguing it is just an attempt by the production to get out of paying the now more than $4.5 million in back rent it owes.
The lawsuit from Sleep No More claims it agreed to amend its lease in 2022 to help Centaur navigate the chaotic aftermath of the pandemic. The new agreement included a major rent increase, but Centaur said this was just a way to help it renew the mortgage on the building, and Sleep No More would not actually need to pay this rent in full, according to its suit.
Centaur's motion to dismiss describes this as the show's senseless effort to continue performing at the McKittrick Hotel without paying rent. It is based entirely on a "vague and unsubstantiated contention" that Centaur assured Sleep No More it would not actually need to pay rent despite signing the new lease, the motion says.
"These absurd claims, which if allowed to proceed would eviscerate the very purpose of having a lease, fail on every conceivable level," it reads.
Sleep No More also argued that its new lease required Centaur to make a good-faith effort at refinancing its mortgage, but the landlord has not done this. The motion pushes back on this claim as well. Not only did Centaur tell its lender it would extend the maturity date of its loan by five years to 2028, but it also is not even seeking to end its lease with Sleep No More due to issues securing a refinancing, it says.
Additionally, the motion argues the claims in the Sleep No More lawsuit are essentially the same arguments the production made in its response to Centaur's rent lawsuit, meaning it should be dismissed over duplication issues.
Centaur's attorneys, Oved & Oved's Terrence and Darren Oved, called the lawsuit from Sleep No More "a baseless, misguided and transparent attempt to avoid its obligation to pay over $4 million in past due rent."
"We are confident the court will see through this frivolous ploy and award our client every dollar it is owed," they said.
A representative for Sleep No More did not respond to a request for comment by press time.
Sleep No More is an interactive version of William Shakespeare's Macbeth in which audience members decide what to see and where to go. The show has supposedly been planning to close since November but keeps extending its final production date. The latest date for its last show is now Sept. 29, according to the production's website.
An effort to install a bank in a long-empty storefront at an Upper West Side building known for its role in the series Only Murders in the Building may be a case of too little, too late.
On Tuesday Flagstar Bank sued the owner of the space, Extell Development Co., to initiate foreclosure proceedings after firm president Gary Barnett allegedly fell months behind on paying off a $100 million loan backed by the property, according to the filing in Manhattan Supreme Court.
The storefront, at Broadway and West 86th Street, has been vacant since a Banana Republic store shuttered in 2012. But in recent weeks Barnett appeared close to installing a bank branch in the space, whose address is 2360 Broadway.
But in order to do so, the developer needed special permission from the Department of City Planning, as the bank sought a wider storefront than current zoning allows. The department has not yet ruled on the request, public filings show.
An Extell spokeswoman had no comment by press time, and the firm had not yet filed a legal response.
In 1994 Barnett, in a deal that happened well before he became known for luxury high-rises on Billionaires Row, joined other investors to buy the Belnord, a full-block rental complex whose Beaux-Arts facade stands in for the fictional Arconia in Hulu’s Only Murders.
About two decades later, the owners filed plans to convert the National Register-listed site into a condo but wound up selling the 209-unit upstairs portion to Ziel Feldman’s HFZ Capital Group for $575 million.
Barnett appears to have kept the two retail condos that contain the numerous storefronts ringing the site and borrowed $100 million against them, according to the city register.
In 2022 he modified his loan to secure more favorable terms, filings show. The loan, which matures in 2027, requires Barnett to pay monthly payments of $475,000 a month. But he hasn’t made a payment since April, according to the suit, and personally guaranteed a payment of $24.5 million in case of default. New York Community Bank issued the original loan, but that lender was acquired by Flagstar in 2022.
The potential bank branch tenant, which has not been named, seeks to have a 46-foot-wide facade on Broadway where zoning allows only up to 25 feet for financial institutions. The 2012 rule stemmed from concern about the encroachment of banks and big-box stores into the Upper West Side.
Not all the retail spaces at the 12-story Belnord appear to be doing badly. A CVS pharmacy, a P.C. Richard & Son appliance store, a Tend dentist office and a Starbucks coffee shop are all currently leasing space at the building, which was considered the largest apartment complex in the country when it opened in 1909.
In May home-decor doyenne Martha Stewart and daughter Alexis Stewart bought a six-bedroom duplex at the development for $12 million.
Joseph Scholz, Flagstar’s lawyer in the case, declined to comment.
New Yorkers are in for another week of scorching weather with dangerous heat and humidity expected to feel like triple digits in some places.
The New York metro region is under a heat advisory, with a “quite uncomfortable” heat index expected to reach as high as 103 degrees at times, in effect until 10 p.m. Tuesday, and which is likely to be extended through at least Wednesday, according to the National Weather Service office for New York.
Accompanying the oppressive heat is an air quality health advisory for ozone issued by the state’s Department of Environmental Conservation for the city and all of Long Island on Monday through 11 p.m. The heightened air pollution — compounded by the sticky weather — is especially risky for older adults, people with respiratory issues and other vulnerable groups.
City officials are warning New Yorkers to take the sweltering heat and smog seriously by staying hydrated, keeping cool indoors or beating the heat at beaches, pools and parks. But aside from advice, the city’s more than 500 cooling centers are among the few tangible offerings the Adams administration is providing to help New Yorkers navigate the brutal temperatures.
“This heat is not normal,” said Mayor Eric Adams during a Monday morning briefing on the extreme heat. “We’ve said it over and over again: climate change is here. It is real and it is a clear and present danger.”
Health officials recommend that those who must work outdoors should drink water every 15 minutes, take frequent breaks in shaded or air-conditioned areas and wear lightweight, light-colored clothing. But just getting from home to work and back again can be a saga in this heat, particularly underground in the city’s stifling subway system.
Some 99% of the city’s more than 6,500 subway cars are equipped with “high-functioning air conditioning,” said MTA board chair and chief executive Janno Lieber. It may not help riders in the short-term, but the best way to report a car with no air conditioning is to complain to the MTA's X account, @NYCTSubway, or to call-in a complaint to 511 — a transit hotline — and provide the subway car number.
Lieber added that the MTA is ramping up what it calls “heat patrols” along the system’s roughly 665 miles of subway track to get ahead of any equipment issues caused by the weather.
Extreme heat kills roughly 350 people a year and is the deadliest type of weather event in the five boroughs, according to the Department of Health and Mental Hygiene. In the past few weeks heat-related emergency room visits have spiked . Typically the number of such visits stays in the single digits, but on June 21 that figure hit a seasonal high of 51 visits when the mercury peaked at 96 degrees, according to city data reviewed by Crain’s.
City health officials encourage people to call 911 if they are experiencing signs of heat illness such as feeling disoriented, nauseous or having trouble breathing. “Listen to your body,” said Dr. Ashwin Vasan, the commissioner of the Department of Health and Mental Hygiene.
Zach Iscol, the city’s emergency management commissioner, added that “there will also be little respite from the heat overnight” since temperatures aren’t expected to dip during the typically cooler evening hours.
Utility Con Edison is proactively asking its customers to be conservative in their energy use to reduce the possibility of power outages. That includes encouraging New Yorkers to shift their use of high-energy appliances, such as washers, dryers and dishwashers, to before 2 p.m. or after 10 p.m., said Jamie Brennan, Con Edison’s vice president of electric operations.
“This level of heat, humidity and power for air conditioning will stress the electric grid,” said Brennan. “That’s why it’s really important that we ask our customers to be smart about how they use energy.”
A baseball team honcho may have hit a home run in Chelsea.
Tampa Bay Rays co-owner Randy Frankel, who also actively invests in wineries, restaurants and waterfront mansions, has landed a taker for his penthouse apartment at Walker Tower, a three-bedroom condo unit at 212 W. 18th St., No. PH8.
On Friday a buyer signed a contract to buy the 3,100-square-foot duplex whose most recent asking price was about $16 million, according to the brokerage Olshan Realty, which tracks luxury sales in Manhattan on a weekly basis by looking at contract signings.
The exact sale price won’t be known until the deal closes and its deed becomes public record. But at a time of some sluggishness in the sales market, Frankel appears to have done well, selling the apartment after only about nine months of marketing and without any reductions in price, firm president Donna Olshan said.
Frankel may have also scored a profit. He paid $12.2 million in 2013 when he bought the unit from Walker Tower’s developer, Michael Stern’s JDS Development Group. In that deal, Frankel used the shell company Three Good Kids LLC; Frankel and his wife, Barbara, have three daughters.
The identity of the buyer of the penthouse is not known. And an email sent for comment to Bespoke Real Estate, the brokerage that handled the listing, was not returned by press time.
It’s not clear how much time Frankel or his family spent in the apartment, which is in a converted Verizon building between Seventh and Eighth avenues that’s popular with celebrities.
Indeed, Frankel, a former managing director of Goldman Sachs, owns and operates two vineyards on Long Island: Croteaux in Southold and Rose Hill in Mattituck. He also, unsurprisingly, has owned homes in Florida, where his baseball team is based.
In 2022 Frankel sold one of those properties, an 8,500-square-foot Miami Beach mansion, for about $32 million after paying $14 million two years earlier, according to The Real Deal. The buyer of the home, in the Sunset Islands enclave, was reportedly Ares Management co-founder Michael Arougheti.
Frankel, who also owns stakes in European soccer teams, bought a controlling interest in the Rays in 2004 with fellow Goldman alum Stuart Sternberg and other investors. Since then the team has made it to the World Series twice, including in 2020, though it lost on both occasions. The Rays currently are sitting in fourth place in the American League’s Eastern division.
The 53-unit Walker Tower, named for Art Deco-era architect Ralph Walker, has been associated with actors and other boldfaced names since opening more than a decade ago. Past and present residents have included Harrison Ford, Calista Flockhart, Blake Lively and Ryan Seacrest. Verizon continues to control space on the lower floors.
Overall 20 Manhattan buyers signed contracts last week for units priced above $4 million, which was two fewer than the previous week, Olshan said; of the 20 deals, 15 involved condos.
But sales of top-floor units have been a particular bright spot. Ten penthouses listed above $4 million have gone into contract in the last two weeks, Olshan added.
Leases
Luxury clothing brand moving Upper East Side store
Address: 956 Madison Ave., Manhattan
Landlord: 925 Madison Avenue Inc.
Tenant: L'Agence
Lease size: 3,300 square feet
Lease length: 10 years
Asset type: Retail
Brokers: Dallimore & Co.'s Simon Dallimore represented the tenant. Lee & Associates NYC's Peter Braus, Morris Dweck and Annie Squier represented the landlord.
Sales
GD Capital picks up Charles Cheriff Galleries building
Address: 84 University Place, Manhattan
Seller: Alan and Stephen Wachman
Buyer: Mark Guindi
Sale price: $11.3 million
Asset type: Mixed use
Read more about the deal here.
Financings
Madison Realty Capital gets funding for East Village project
Address: 644 E. 14th St., Manhattan
Owner: Madison Realty Capital
Lender: Apollo Global Management and Lionheart Strategic Management
Loan amount: Approx. $130 million
Asset type: Mixed use
Read more about the deal here.
Cannon Heights co-op building refinances
Address: 3400 Fort Independence St., Bronx
Owner: Metro Management Development
Lender: New York City Housing Development Corp.
Loan amount: $22.1 million
Asset type: Multifamily
A Greenwich Village building that for decades was home to a 7-floor antiques gallery is slated to be converted into residential, according to the developer behind the project.
Brooklyn-based real estate firm GD Capital acquired the property at 84 University Place for $11.2 million from brothers Stephen and Alan Wachman, according to a deed that appeared in the city register Friday. Mark Guindi, the head of GD Capital, whose ethos includes "identifying underutilized assets that present unique repositioning opportunities," as described by the firm's website, signed the deed under the limited liability company Villa 84.
Guindi told Crain's Monday that he and his team plan to "gut renovate" the building and turn the top six floors into boutique rental units, with one on each floor, and keep retail on the ground floor. He also said there will be a roof deck, the units will be equipped with smart home technology, and a private elevator will open up into each apartment. As of now, he is not planning to include condos, he said.
Guindi bought the 14,988-square-foot building between East 11th and East 12th streets with a $7.3 million loan from Interaudi Bank, records show. The retail space on the ground floor, which Guindi says is to be determined, will take up 1,732 square feet, while the residential portion will be 13,256 square feet, according to permits filed with the Department of Buildings last month. Plans for the construction reveal a $1.5 million price tag, according to the filing, but Guindi declined to provide the total cost estimate for the renovation work. Manhattan-based design firm Kushner Studios is listed as the architect of record.
As for the century-old antique store — Charles Cheriff Galleries — it's relocating across the East River to Long Island City. Alan Wachman says the gallery, which specializes in 19th-century French furniture, has occupied the University Place building since 1924. The Wachmans moved their inventory out of Greenwich Village last week and say they feel that the neighborhood is no longer amenable to that type of industry.
"The area used to be the antique-importing center of New York, and now it's all restaurants and condos," Alan Wachman said.
Jeffrey Gural, the real estate developer and Flatiron building owner, said he loves Joe Biden. But the prolific Democratic donor, who cut Biden a $100,000 check as recently as March, now wants the president to drop his re-election campaign.
“People telling him to stay in are doing him a big disservice,” Gural said in an interview on Friday. “He could step down now on a high note because he’s accomplished a lot.”
Gural, like many Democratic donors, believes that Biden is on track to lose to former President Donald Trump in November and wants another candidate to replace him on the ballot in the wake of Biden’s concerning debate performance last month. But in New York, home to large numbers of high-powered donors, those deep-pocketed people feel largely powerless to influence a debate taking place largely in Washington backrooms.
“Everybody’s waiting to see what the political insiders do,” said Kathryn Wylde, president of the business group Partnership for New York City. “I don’t think the political insiders are allowing the donors to have any role in it.”
Biden has rejected calls to step aside, and the debate has receded, at least temporarily, following the attempted shooting of former President Trump on Saturday. But the consequences of the waning belief in Biden’s viability are already clear: Gural said he will shift his attention toward supporting down-ballot Democratic candidates for Congress, something other donors have also pledged to do.
“Right now, that’s my focus,” Gural said. “If Joe steps aside and we have a new candidate who's more likely to win, then I would resume making donations.”
An official at a prominent New York labor union said they had made a similar decision in the wake of the debate, opting against sending its members to knock doors in battleground presidential states like Pennsylvania.
“Since the concerns about Biden have arisen, we're leaning more towards disproportionately focusing our firepower on local congressional stuff,” said the labor official, granted anonymity to discuss the non-public plans.
Other New York donors remain firmly in Biden’s camp. Amy Goldman Fowler, a billionaire real estate heiress who gave $500,000 to Biden’s campaign in March, told Crain’s in an email that “I have been a long-time admirer of the President and continue to support his re-election efforts.”
“Recently I reiterated my support by making an additional significant contribution to President Biden’s election fund,” Goldman Fowler said, although the latest donation has not yet appeared in campaign finance records. “Looking forward to November, I will most certainly support the Democratic ticket from top to bottom, out of gratitude and love for this country and our democracy.”
Despite reports that Democratic donors may withhold contributions to pressure Biden to withdraw, there is little indication that those efforts are having an effect. Between Biden and the failed effort by Republican donors to prop up an alternative to Trump in the Republican primary, recent events have shown the limits of billionaires’ ability to buy influence, Bloomberg reported last week.
New York plays a big role in the president’s fundraising operation. Donors based in the state have spent about $24 million in support of Biden — 10% of his total, second only to California, according to data analyzed by the watchdog Open Secrets. The New York City metro area ranked third of any city at $18 million, behind Washington, D.C. and San Francisco.
Reflecting the region’s importance, one of Biden’s first moves after the June 27 debate was to swing through East Hampton for a fundraiser, which produced largely favorable reviews of his performance from those in attendance.
Other New York City donors that wrote Biden major checks in recent months include the investor George Soros, developer Daniel Tishman, Broadway producer Ted Snowdon, and Eric Laufer and Philip Munger — the sons of prominent investors Henry Laufer and Charlie Munger.
Gural, 82, remains fond of the 81-year-old president despite souring on his campaign. If Biden’s capacities have weakened, Gural said he is sympathetic.
“He’s the same age as me,” he said, “and I’ve lost a step.”
Madison Realty Capital has landed about $130 million in financing for its controversial project at 644 E. 14th St., which should clear the way for the real estate private equity firm to complete the development in less than two years, the company shared with Crain's.
The funding consists of $102 million from Apollo Global Management and $27.6 million from Lionheart Strategic Management, according to Madison. This package includes all the financing Madison will need to finish the mixed-use project, which will feature about 200 apartments plus retail and community space across about 165,000 square feet.
The development's foundation is complete, and it is starting to go up with an anticipated completion date of the first quarter of 2026, according to the firm. It will ultimately stand 24 stories and 234 feet tall.
The company is building it under Option B of the now-expired 421-a affordable housing tax break. This requires 30% of the units to be affordable, split between at least 10% for households earning no more than 70% of the area median income, or about $98,000 for a family of three, and 20% for households earning no more than 130% of the area median income, or about $182,000 for a family of three. The state extended the completion deadline for projects using 421-a to June 15, 2031, in its budget this year.
If the project keeps to its timeline of wrapping up in early 2026, it will bring at least one part of a messy and lengthy East Village saga to a close.
Multiple developers have been trying to build a major project at 644 E. 14th St. for years. Opal Holdings bought the site for $23 million in 2016 and planned to construct a large residential building, but Madison Realty Capital, originally a lender on the project, then bought the site from Opal in 2020 for about $31.3 million.
Much of the controversy around these development efforts has been centered on their impact on the adjacent multifamily building at 642 E. 14th St. Landlord Jeremy Lebewohl sued Opal over its project in 2019, arguing that the firm's construction work had caused damages to his building worth more than $1 million, and the city's Department of Buildings issued a vacate order for the property in late 2023, ordering tenants to leave after construction at 644 E. 14th St. damaged its foundation, according to city records and reporting.
Lebewohl recently filed plans to demolish the 5-story, 18-unit building entirely. He also faces a lawsuit from several of the property's rent-regulated tenants asking the court to require him to repair all of the building's violations, allow them back in their apartments and not demolish the property.
Macy's shares tumbled on Monday after it said it was ending discussions with two investors to buy out the department store chain, pledging to execute a turnaround plan on its own.
Shares sunk 16%, their biggest decline in four years, after the company said a buyout offer from Arkhouse Management and Brigade Capital Management wasn’t an “actionable proposal” because it didn’t have sufficient financing, the company said in a statement on Monday.
Macy’s decision to officially call off talks is the latest twist in a contentious saga that began with a $5.8 billion buyout offer from the investor group in December. Arkhouse and Brigade raised the bid to $24 in March, and again to $24.80 in June, an offer that Macy’s said wasn’t “compelling.” The financing commitment letters accompanying the revised offer were also insufficient to give the board confidence, said Macy’s, which concluded that further talks were not in its best interest.
Macy’s Chief Executive Tony Spring, who took over in February, said he will execute a turnaround plan on his own as the department store faces inflation-weary consumers who are increasingly shifting their purchases online.
Spring plans to shut stores that haven’t been performing well and revamp ones that have reported relatively better sales. He’s also betting on an expansion of Bluemercury, the high-end skin-care and cosmetics chain, which has had stronger sales than Macy’s and Bloomingdale’s, buoyed by the post-pandemic surge in demand for beauty products.
Calling off the talks “may eliminate a distraction to the retailer’s plan to restore growth,” Bloomberg Intelligence analyst Mary Ross Gilbert wrote on Monday.
That may not be enough to stem the bleeding across the sector, however. Department stores in the US are going through a period of upheaval as executives try to figure out the most profitable path forward. The owner of Saks Fifth Avenue is acquiring Neiman Marcus Group. And Nordstrom Inc.’s founding family has said it’s considering taking the retailer private.
Shares in competitors Nordstrom fell as much as 5.3% on Monday following the Macy’s announcement, while Kohl’s Corp. declined as much as 3.6%.
A representative for Arkhouse didn’t immediately respond to a request for comment.
What’s going on with Al Cockfield’s political action committee?
The Queens reverend, who is a close ally of Mayor Eric Adams, launched a PAC called Striving for a Better New York, raising more than $1 million from people who support Adams. Instead of paying for ads to back the beleaguered mayor, the PAC has been doing something much more curious: donating to political candidates beyond New York.
The PAC gave $1,000 to a candidate for mayor of Baton Rouge, La., $1,000 to a candidate for county prosecutor in Kansas City, Mo., and $2,500 to a candidate for controller in Houston, Texas, Politico reported.
In total, the committee has donated $15,000 to 11 candidates running nowhere near New York over a year and a half, according to state filings. Cockfield offered no explanation beyond the fact that he liked to support candidates in New York and beyond.
The contributions themselves don’t run afoul of any campaign rules. But the PAC itself has drawn scrutiny in the past. It once sent $60,000 to a charter school that Cockfield founded and runs, and even made payments to himself. As recently as 2022, the PAC was paying Cockfield a $7,173-per-month salary.
A powerful pastor who leads two Christian schools and a charter school, Cockfield has helped fundraise for Adams; his daughter works in the mayor’s press office. In addition, Cockfield is an adviser at a law firm, having helped hotel developer Weihong Hu reverse stop-work orders that the Adams administration placed on her projects, The City, The Guardian and Documented reported.
Cockfield first created the PAC after Adams won his primary in 2021 and raised more than $1.3 million from real estate developers, tech firms and others in the last four months of that year. Adams spoke at an early fundraiser for the PAC. Donors were directed to contribute to it, after Adams’ campaign reached its own fundraising limit.
Brianna Suggs, who was Adams’ campaign fundraiser at the time, joined the PAC for a period. Her last recorded payment was in January 2023, according to Politico, 10 months before federal authorities raided her home as part of an investigation involving Adams’ fundraising. She has not been accused of any wrongdoing.
None of this means Adams has any current involvement with this PAC. Ingrid Lewis-Martin, Adams’ top political adviser, said she didn’t work with the PAC. But it’s all very odd, and indicative of the company Adams has kept and the administration he has built: one that has attracted the scrutiny of federal investigators and eagerly tested ethical boundaries.
There’s Lamor Whitehead, the flamboyant pastor who was recently sentenced to nine years in federal prison after being found guilty of numerous fraud and attempted extortion charges, along with lying to the FBI. Adams had no association with Whitehead’s crimes, but he had been close enough to the pastor that he described Adams as his “mentor.”
Others have, through legal means, cashed in on their connections to Adams. Frank Carone, a well-wired Democratic attorney, spent about a year as Adams’ chief of staff. In retrospect, it seemed like preparation for his next career move: running a consulting shop with wealthy clients who have business before the city. These days, Carone trades on his access to Adams to make tremendous amounts of money.
The political class is openly speculating about whether Adams himself or someone close to him will be indicted. No one knows what will happen. The scandal clouds might eventually clear.
In less than a year, though, Adams will have to win a Democratic primary to have a second term as mayor. Whether he can do that, given his low approval ratings and the tough, strange headlines that have followed him, remains to be seen.
Ross Barkan is a journalist and author in New York City.
Barneys New York, the department store long beloved by rich New Yorkers before a 2019 bankruptcy shuttered its Madison Avenue flagship and other U.S. outlets, is gearing up for a revival of sorts at outposts in Manhattan and beyond.
It’s looking to launch new Barneys products and branch out from the perfume and beauty lines established after Authentic Brands Group purchased it out of Chapter 11, according to a person familiar with the matter. The brand would develop home goods, sportswear, intimates, outerwear and items in other categories to be sold at Saks Fifth Avenue and Neiman Marcus stores, the person said, asking not to be identified.
The plan hinges on the pending $2.65 billion acquisition of Neiman Marcus Group by the owner of Saks. Until now, Barneys’ outposts at Saks have only sold clothing curated from designers, alongside Barneys-brand merchandise that has been limited to beauty products.
Early negotiations around the planned initiative are underway, said the person, adding that no formal agreements had been reached.
Representatives for Authentic, Saks Fifth Avenue and Neiman Marcus declined to comment.
The prospective deals would involve Authentic — the owner of Barneys’ intellectual property — assigning product licenses to new partners. Saks Global — the new company that would be created after the Saks-Neiman merger — would have the right to distribute dozens of new items in home goods and other categories.
Potential distribution would also extend to Barneys’ global stores — it has 10 in Japan — and any other luxury outlets available to Saks Global.
Authentic Brands Group bought the Barneys name out of bankruptcy in late 2019 after its annual Madison Avenue rent alone eclipsed $30 million while competition for shoppers increased.
Sarah Jessica Parker, who memorialized Barneys’ fashion influence in six seasons of HBO’s "Sex and the City," told Bloomberg at the time that the store was a “beacon” and its demise was “stunning.”
Authentic, a brand-management company whose model involves licensing the trademarks of its properties to partners who design, source, manufacture and sell branded goods, has also snapped up the IP of distressed names including Brooks Brothers, Forever 21 and Eddie Bauer in recent years.
The upstart: Reality Defender Four years ago, Ben Colman, Ali Shahriyari, and Gaurav Bharaj received research grants to investigate how deepfakes and generative artificial intelligence could affect the presidential election.
“We were certainly correct about the problem. We were incorrect in the timing,” said Colman. “While the technology existed, the methods to use the technology did not yet exist at a level that was easy enough and cheap enough. That's changed over the last 24 months in a dramatic way.”
There are now thousands of apps and websites that allow people without any technical skills to create “synthetic content” and broadcast it to the world for little to no money. Colman, Shahriyari, and Bharaj founded Reality Defender in 2021 to combat the prevalence of deepfakes by creating a platform to verify content created by generative AI.
Reality Defender’s software can detect a variety of deepfakes across audio, video, image, and text files. Clients use Reality Defender’s web application to drag and drop files and pay to verify individual files, or they can pay for the API and pre-purchase a certain number of scans. The API is priced between $100,000 and $1 million a year. Businesses in particular are at risk of being defrauded by bad actors using AI for voice-cloning or identity theft, for example.
The company has raised just over $22 million over three funding rounds and has over $1 million in annual revenue. Clients have included Comcast and Microsoft, and its technology has been used in broadcast newsrooms, bank call centers, humanitarian organizations and governments around the world.
“They were very early at recognizing that this would be a meaningful threat both to democracy and society writ large as well as a key challenge for enterprises as we enter an age in which generative AI is increasingly globalized,” said Zoe Weinberg, founder of ex/ante, an early-stage venture fund that backed Reality Defender in 2021.
The reigning Goliath: Meta
This spring, Meta announced it would begin labeling content made or altered with AI. The decision follows Meta’s Oversight Board’s recommendations to update its review policy as AI-generated content sweeps the internet.
Meta will not automatically detect the software and instead give users the choice to label their content as “Made with AI” themselves. However, the announcement noted that moderators will add the label if they detect the use of AI.
How to conquer the giant
Colman, Shahriyari, and Bharaj were so early to the world of deepfakes and generative AI that it made fundraising an uphill battle when they started to pitch venture capital firms in late 2020. Colman described being repeatedly told that deepfakes would not be a problem.
“It wasn't difficult. It was impossible. It was like we were trying to sell, I don't know, we're going to go mine gold on Mars,” he recounted. But Colman and his team insisted that this would be an issue that companies and governments needed to get ahead of. “We were really, really confident that if bad actors can do something with new technology, they will.”
They eventually found support from a couple of investors, participated in incubators like Y Combinator and the FinTech Innovation Lab, and were selected to attend events and conferences like TechCrunch Disrupt and the RSA Conference (“Like the Oscars” for the cybersecurity world, according to Colman.) At the same time, Reality Defender carried out paid and unpaid pilots with companies, government and humanitarian organizations, and journalists.
“In the early days, there was just not a sophisticated understanding of how this could be a market,” said Weinberg. “What Ben has done a really good job of, over the years, is helping people to see that this is a cybersecurity problem and can be a fraud issue.”
Eventually, as platforms like OpenAI and ChatGPT became ubiquitous, Reality Defender’s technology found a market.
“Fast forward to today. We're no longer begging and pleading to attend conferences. We're now being invited to speak at them,” Colman said.
The next challenge
In April 2024, Colman testified in front of the Senate Judiciary Committee in support of more robust regulation and legislation to curb the threat of generative AI. “Within cybersecurity, AI is changing everything,” he said. “Both from the traditional cybersecurity tools and services, but also creating a whole new vector for risk.”
Colman now finds himself spending a lot of time in Washington, D.C., advocating for policies that would indicate that something is AI-generated or manipulated, all while acknowledging that the most comprehensive solution would necessitate checking in real-time—comparing Reality Defender’s tools to a metal detector.
In Colman's view, the current push for more content moderators that can watermark or add notes to indicate media is AI-generated is short-sighted and could end up deceiving more people versus helping the general public.
“My father will forward me something that is, in his view, obviously real because it's been community-noted,” he explains.
“Even the things that look real can be fake. Because while our team of 40 is two-thirds PhD researchers and engineers, in the last six months, to their trained eye, they cannot know the difference,” he added. “Which means that my father just doesn't stand a chance.”
Olivia Bensimon is a freelance journalist in New York City who reports on human-centered stories.
Know a New York startup you would like to see featured in a future column? Write to oliviajbensimon@gmail.com.
As world financial markets started to reopen after the attempted assassination of Donald Trump, one thing seemed likely: The Trump trade will get even more momentum.
The series of wagers — based on anticipation that the Republican’s return to the White House would usher in tax cuts, higher tariffs and looser regulations — had already been gaining ground since President Joe Biden’s poor performance in last month’s debate imperiled his re-election campaign.
But the trades were expected to take deeper hold, with Trump galvanizing supporters and drawing sympathy by exhibiting defiant resilience after being shot in the ear on stage at a Pennsylvania rally.
The dollar — which would gain if loose fiscal policy kept bond yields elevated — started to move higher against most peers early in Asia trading, with the Mexico peso leading the slide, weakening 0.3%. Bitcoin rose above $60,000, potentially reflecting Trump’s crypto-friendly stance, while futures on the S&P 500 Index for September rose 0.2% at 08:47 p.m. in New York.
“For us, the news does reinforce that Trump’s the frontrunner,” said Mark McCormick, global head of foreign-exchange and emerging-market strategy at Toronto Dominion Bank. “We remain U.S. dollar bulls for the second half and early 2025.”
To be sure, there’s still plenty of room for surprises with almost four months to go until the election. The emergence of political violence may deepen concern about instability in the US and push investors into haven assets, potentially overshadowing some of the market positioning that has already taken place in the run-up to the election.
While future contracts on 10-year Treasury notes for September showed declines in early Asia trading, U.S. government bonds tend to rally when investors seek temporary safety, so that may distort the Trump trade in the Treasuries market, which hinges on wagering that the yield curve will steepen as long-term bonds underperform on anticipation that Trump’s fiscal and trade policies will fan inflation pressures.
Moreover, some investors may want to book early gains or be wary of getting deeper into an already crowded position.
“Political risk is binary and hard to hedge, and uncertainty was high as it is with the close nature of the race,” said Priya Misra, a portfolio manager at JPMorgan Investment Management.
“This adds to volatility. I think it further increases the chance of a Republican sweep,” she said, adding that “could put steepening pressure on the curve.”
Equity investors are preparing for at least a near-term jump in volatility when S&P 500 futures start trading at 6 p.m. in New York.
While traders generally don’t expect Trump’s assassination attempt to derail the stock-market trajectory in the long run, a pick-up in near-term price swings is likely. The market has already been contending with speculation that valuations have become too stretched, given the boom in artificial-intelligence stocks and the risks posed by elevated interest rates and political uncertainty.
But investors have also been anticipating that bank, health-care and oil-industry stocks would benefit from a Trump victory.
“The attack will boost volatility,” said David Mazza, CEO at Roundhill Investments, predicting investors could seek temporary safety in defensive stocks like mega-cap companies. He said it “also adds support for stocks that do well in a steepening yield curve, especially financials.”
The early reaction echoes what was seen after the first presidential debate in late June, when Biden’s weak performance was seen as fueling Trump’s election odds.
The dollar advanced during that event, and investors soon began embracing a wager that involves buying shorter-maturity notes and selling longer-term ones — known as a steepener trade. That trade has been paying off, with the 30-year Treasury yields jumping to nearly 5 basis points below 2-year ones from around 37 basis points below ahead of the debate.
“If the market sense that Trump’s chances to win are higher than they were on Friday – then we would expect the back end of the bond market to sell off in the manner we saw in the immediate aftermath of the debate,” Michael Purves, CEO and founder of Tallbacken Capital Advisors, wrote in an email.
While bond traders have been pricing in at least two interest-rate reductions in 2024, a major boost in Trump’s election odds could push the Federal Reserve toward staying on hold for longer, according to Purves.
“Trump’s stated policies are (at least now) more inflationary than Biden’s,” he wrote, “and we think the Fed will want to accumulate as much dry power as possible.”
New York City’s sweltering heat wave has sent more people to the hospital during the last few weeks – and relief isn’t expected any time soon.
Citywide hospitalizations from the sweltering temperatures have trended upward, with 25 people visiting the emergency room for a heat-related illness on Thursday alone, according to city data.
Heat-related emergency room visits in New York City typically stay in the single-digits, but climb as temperatures rise. Emergency visits spiked to a seasonal high of 51 on June 21, when the temperature reached a high of 96 degrees.
The temperature on Thursday was 89 degrees, but it's expected to get hotter in the coming days.
New York City and state officials have issued recommendations to help residents beat the heat as temperatures are again expected to feel like more than 100 degrees early this week. But aside from advice, officials appear to offer few solutions to help New Yorkers stay safe.
Extreme heat is the deadliest type of weather event in New York City, killing roughly 350 people a year, according to the Department of Health and Mental Hygiene’s most recent heat-related mortality report. Heat sends 450 people to the emergency room each year on average, said Patrick Gallahue, a spokesman for the Department of Health and Mental Hygiene. Risk is higher for people with chronic conditions such as heart disease, as well as people without access to air conditioning.
“Heat is deadly and climate change is making our summers more extreme and dangerous,” Gallahue said. “We want New Yorkers to know that resources are available, and we will continue sharing information and support when the weather gets dangerously hot.”
City and state officials offer some resources to help New Yorkers stay cool. The city has more than 500 cooling centers in libraries, community and senior centers and public housing buildings. The city Health Department has also issued multiple heat warnings to providers this year and coordinates emergency response with a citywide steering committee led by the New York City Emergency Management Department.
State officials administer the Home Energy Assistance Program, a federal initiative to help low-income New Yorkers get and install air conditioning in their homes at no cost. The program offers financial assistance to help people afford heating during the cold months and cooling during the warmer ones; but for the last two years the program has run out of cooling funds less than a month into summer.
Gov. Kathy Hochul issued a warning to New Yorkers on Friday about the extreme temperatures expected to persist through Wednesday of this week.
“During this time, be sure to check on your family, friends and neighbors, and stay hydrated as the temperatures continue to rise,” Hochul said in a statement.
STORY UPDATE: This story, published on July 12, has been updated with additional information about the city’s investments and efforts to publicize the 988 mental health crisis line.
MEASLES DETECTED: Two adults living at a migrant shelter in Clinton Hill have been diagnosed with measles, a preventable but highly contagious infectious disease, the city's Department of Health and Mental Hygiene announced Friday. The agency is coordinating with New York City Health + Hospitals to identify other individuals who may have been exposed and determine whether they are vaccinated. Although measles is a highly contagious illness, the risk to the community is low because most New Yorkers are vaccinated, which is the "single best way to prevent measles," Health Commissioner Dr. Ashwin Vasan said in a statement.
AGING CONTRACT: The city’s Department for the Aging awarded a $3.4 million contract to the Upper East Side-based nonprofit Carter Burden Network to coordinate care for older adults, according to a notice in the City Record last week. Under the contract, the aging services nonprofit will provide intake and care coordination for older adults, as well as operate a visitors program to ease loneliness among homebound individuals.
New York City hospitals have received billions in the past decade from state grants to build new emergency rooms or expand primary care, new data shows. But some experts criticize the flow of state money to hospitals with few conditions or contingencies.
New York state’s Department of Health allocated $4.3 billion to health care capital projects in the last decade, funneling nearly half of those funds to New York City, according to state data obtained via public records request by the Empire Center for Public Policy, a right-leaning think tank based in Albany.
The city is home to the biggest capital project in recent history: the $700 million transformation of safety-net hospital system One Brooklyn Health, awarded under former Gov. Andrew Cuomo’s administration. Since the state allocated funding for One Brooklyn Health in 2018, the health system has received $335 million of the capital allocation, according to the data, published Thursday.
The state has allocated more than $6 billion to capital projects in the last decade and spent $4.3 billion so far, according to Bill Hammond, senior health policy fellow at the Empire Center who analyzed the data. Spending is largely related to a shift in policy that has allowed hospitals and health care facilities to build on the state’s dime.
“It’s a lot of money,” Hammond told Crain’s. “And it doesn’t come with a lot of strings.”
Previous state capital allocations were selected in part by how they benefited Medicaid beneficiaries and uninsured individuals, said Cadence Acquaviva, a spokeswoman for the state Department of Health. This year’s budget redirects previously allocated funds to a new program designed to improve safety-net facilities, which primarily low-income and uninsured patients, she added.
Although the state allocates money for capital projects via one-time grants, it wasn’t always that way. Previously, New York state subsidized health care capital projects through low-interest loans from the Dormitory Authority of the State of New York, which funds construction for public projects.
But since 2014, the state has issued grants through eight capital funding programs, including the several phases of the Statewide Health Care Facility Transformation Program, according to Hammond. Grant programs offer hospitals upfront costs for new medical units or IT programs, with little requirements or restrictions on how the money is spent, he added.
Most local hospitals have received funding through state capital grant programs. Jamaica Hospital Medical Center received $150 million to build a new emergency room for example, and New York City Health + Hospitals raked in nearly $300 million for various projects including IT improvements and emergency room upgrades.
But while New York City has received $2 billion in total, upstate counties have received more money per capita than downstate, Hammond said. The second-largest capital project was a $282 million payment to Mohawk Valley Health System to build a new hospital in downtown Utica.
Unlike the Medicaid program, which is based on need and how many low-income and uninsured patients hospitals treat, capital grant programs come with looser rules and regulations. The funds flow to financially distressed hospitals as well as financially thriving health systems such as New York-Presbyterian and NYU Langone.
Albany has a penchant for ambitious programs that, while well-intentioned, veer off into costly misadventures. The latest example is the state's handling of the Consumer Directed Personal Assistance Program, a program that epitomizes bureaucratic bloat and lack of foresight, leaving taxpayers with a burgeoning financial load.
This matters to New York's business community which often finds itself stifled under the weight of one of the nation's highest tax burdens and a notoriously complex regulatory environment.
Originally designed to empower individuals by allowing them to select and train their caregivers, CDPAP took an unfortunate turn in 2015 when eligibility requirements were loosened. This decision, presumably made with good intentions, opened floodgates to an unsustainable expansion. The result? A staggering increase in program spending, from $219 million in 2014 to an eye-watering $9.1 billion in 2023. Such exponential growth points to a glaring oversight in policy-making.
Subway ads for the program almost seemed to invite abuse by promoting caregiving roles with an emphasis on perks over qualifications. This casual invitation significantly undermines the seriousness that caregiving demands.
Remunerating care labor is a step toward gender equity, acknowledging the economic value of work that has long been taken for granted. However, the execution of this program has been wanting. Gov. Kathy Hochul's recent step to rein in the program’s costs by reducing the number of intermediary companies from 700 to just one is prudent. Yet, this consolidation raises concerns about service disruption and administrative chaos, reminiscent of Massachusetts’ troubled experience, which resulted in delayed payments and caregiver shortages.
Streamlining should not mean steamrolling. The issues at hand — the program’s ballooning costs and susceptibility to fraud — will likely demand further attention and reform.
The governor should stand firm on the solid ground of sustainable and equitable policy-making. If not, New Yorkers should be ready to hold her accountable for the mismanagement of a program that could have revolutionized caregiving, but is instead mired in controversy and inefficiency.
For over sixty years, Amway business owners have been more than just providers of nutrition supplements and well-being products, they’ve been promoters of healthy routines and lifestyles for individuals, families and communities. This enduring commitment is driven by a team of over 800 in-house scientists, engineers and technicians spread across over 75 labs, all focused on researching and developing innovative products that enhance lives.
At the heart of this mission is Nutrilite. For more than 90 years, Nutrilite’s rigorous scientific inquiry and innovative approach has allowed us to continue developing new health supplements that meet quality, safety and effectiveness standards.
Long before multivitamins became mainstream, Nutrilite introduced Americans to the benefits of daily health supplements. We stand out as the only global vitamin and dietary supplement brand that grows, harvests and processes plants on our own certified organic farms. Our vertically integrated approach means we oversee every step, from seed to supplement, ensuring that the plants we cultivate on our 6,000 acres of certified organic farmland meet unparalleled standards for purity and safety.
For me, the impact of Amway’s innovative products is personal. The Nutrilite Perfect Pack – a combination of vitamins, minerals, plant nutrients and omega 3s – has been part of my daily routine for years. It’s easy to carry and ensures I get the nutritional care my body needs wherever I am. Every morning, I mix Nutrilite Organics Immunity Superfoods, a nutrient-rich blend of acerola cherries, elderberries and other superfruits, into my yogurt, setting a healthy tone for the day.
One of the most exciting areas of research at Amway is our study of microbiomes and their impact on the body’s gut health. Later this year, we’re thrilled to introduce Begin, a breakthrough product developed by our scientists to enhance gut health and help support the body’s natural defense and overall holistic health. Begin is just one example of the many nutritional solutions Amway scientists have pioneered to address specific health needs.
Amway’s Independent Business Owners (IBOs) play a crucial role in delivering our health and well-being products to consumers across America. Trusted by their customers, our IBOs build meaningful relationships and offer tailored health solutions that help individuals achieve their wellness goals.
In New York alone, over 15,000 small business owners engage with their communities, promoting healthy living habits and partnering with us in community engagement initiatives. Our long-standing partnerships with organizations like Easterseals, support for veterans’ causes, and involvement in backpack and coat drives are just a few examples of how we give back.
What truly sets Amway apart is the direct connection to individuals and their communities. Through enduring relationships and a commitment to continuous care and service, our IBOs provide an enhanced experience to each customer, helping them lead healthier, happier lives.
From promoting mental well-being and community involvement to pioneering sustainable practices globally, Amway and its Independent Business Owners are dedicated to empowering people to extend their health span and live their best lives.
About the Author
Andrew Schmidt
Managing Director
Amway North America
Schmidt manages the North America business of the world’s largest direct-selling company. He’s passionate about entrepreneurship and helping people live better, healthier lives.
Former President Donald Trump is being evaluated at a medical facility but is “fine” after an incident where he was rushed off stage during rally in Butler, Pennsylvania, his campaign said.
“President Trump thanks law enforcement and first responders for their quick action during this heinous act,” Trump spokesman Stephen Cheung said in a statement Saturday. “He is fine and is being checked out at a local medical facility. More details will follow.”
Trump was seen grabbing at his ear after a loud popping noise was heard at the rally. Secret Service agents rushed to the stage, yelling “get down” and formed a circle around the former president.
After slowly standing up, Trump repeatedly pumped his fist in the air and waved to the crowd before exiting the stage in a ring of agents. He appeared to have blood on his right ear
The Secret Service said in a statement that Trump was safe and that they had implemented protective measures.
“This is now an active Secret Service investigation and further information will be released when available,” Anthony Guglielmi, a spokesman for the agency said in a post on X.
Police told onlookers to leave the rally.
The incident happened about 6:13 p.m. New York time, just a few minutes after Trump began speaking on stage.
The Trump campaign did not immediately respond to requests for comment on the incident or the former president’s condition.
Trump was visiting swing-state Pennsylvania for his last rally before the Republican National Convention begins on Monday, and as he is preparing to announce his vice presidential pick.
In a post on X, shortly after the incident, House Republicans urged Americans to “Pray for President Donald J. Trump.”
The White House said President Joe Biden had received an “initial briefing” on the incident at Trump’s rally.
Here are the subway disruptions, road closures and other commuting changes you should be aware of as you get around the city this week.
Subways * 5 train service ends early between Bowling Green, Manhattan and East 180 Street in the Bronx from Monday, July 15 through Thursday, July 18 beginning at 8:15 p.m. * No G trains between Bedford-Nostrand Avenues in Brooklyn and Court Square in Queens through Sunday, August 11. * In Brooklyn, no L trains between Myrtle-Wyckoff Avenues and Atlantic Avenues between Monday, July 15 at 10 a.m. and Tuesday, July 16 at 2:30 p.m. * The last stop for some F trains headed toward Coney Island is Church Avenue from Tuesday, July 16 at 9:30 a.m. through Friday, July 19 to 3:30 p.m. * In the Bronx, 2 trains run every 16 minutes between Gun Hill Road and Wakefield-241 Street on Wednesday, July 17 from 10 a.m. to 2 p.m. * G trains run every 15 minutes between Wednesday, July 17 and Friday, July 19 from 11:30 a.m. to 1 p.m. each day. * In Brooklyn, no B trains between Kings Highway and Brighton Beach on Thursday, July 18 from 9:45 a.m. to 3 p.m. Take the Q instead. * No Q trains between Brighton Beach and Coney Island-Stillwell Avenue in Brooklyn on Thursday, July 18 from 9:45 a.m. to 3 p.m.
Commuter rail * Westbound trains skip Elmont-UBS Arena, Queens Village and Hollis stations, Monday through Thursday from 10:00 a.m. through 3:00 p.m. through August 1. * Trains bypass Locust Manor, Laurelton and Rosedale in both directions, beginning Friday at 11 p.m. to Monday at 4 a.m. through August 5.
Roads and bridges * In Brooklyn, 3rd Avenue between 82nd Street and Marine Avenue will be closed for the 3rd Avenue Summer Stroll on Friday, July 19.
Read recent transportation stories:
One of the city’s more electrifying homes — a townhouse tucked inside an early 20th-century power plant — is hoping to connect with a buyer.
The 5-story, single-family dwelling at 214 Lafayette St. in SoHo hit the market Friday morning. The asking price for the 10,000-square-foot, three-bedroom building, whose brick facade sports a nearly 3-story arched window, is $39 million, which also puts it in a unique class.
No. 214 is the third-priciest townhouse currently for sale, with the first two located in a neighborhood more used to ultra-expensive single-families: the Upper East Side.
The sellers of No. 214 appear to be Marcus Nispel, a Hollywood director known for reboots of horror movies such as Friday the 13th and The Texas Chainsaw Massacre, and his wife, songwriter Dyan Humes-Nispel.
The couple bought the site between Spring and Broome streets in 1996 for $1.7 million, according to the city register. Though No. 214 was transferred to a shell company in 2012, the couple seems to still control the building, as signatures for the “grantor” and “grantee” on the 2012 deed are the same.
But they reportedly separated in 2020 and divorced in 2022. In any event, the house doesn’t seem to have functioned as a home for some time. In fact, in May Italian high-end home furnishings company Gessi opened a boutique there after lavishly making over all five levels.
It’s not known if the Gessi store, which also added a large sign to the facade, is there on a pop-up or longer-term basis. An email sent to the company’s New York office was not returned by press time. And Douglas Elliman’s Keith Copley, who is marketing the property, did not respond to a request for comment.
The Nispels may not have lived full time at the property for a while. For years it was offered on and off as a rental, and one of the most expensive in New York at that. In a listing from 2015, for instance, the asking rent was $80,000 a month, or close to $1 million a year, though No. 214 was also offered along the way as a party venue that could fit 100 guests at tables or 200 standing up.
Featuring a 12-foot-by-40-foot basement pool, a fourth-floor primary suite and a 900-square-foot roof deck, all connected by an elevator, the townhouse also has a massive living room with cavernous ceilings and exposed brick walls. It’s where Beyonce twirled in the video for her 2008 “Halo” ballad before cooling off with a dip downstairs.
From the outside, the building’s Beaux-Arts details would hardly suggest a power plant. That element of disguise was common with early substations, which once helped convey currents from neighborhood to neighborhood, according to historical accounts.
Largely abandoned by the 1960s, such substations later became magnets for developers for their proportions and architecture. In Chelsea, a chalk-colored version with a telltale arched window, and six condo units inside, occupies 119 W. 22nd St., and the Upper East Side offers 123 E. 83rd St., whose 6 stories contain 20 apartments.
One of the most striking may be the red-brick version at the Upper West Side’s 171 W. 107th St., which features two soaring windows. In 1990 the firm General Atlantic redeveloped the property by constructing a tower atop the building to create a 15-story, 25-unit affordable housing complex.
Few substations, though, seem to have been reinvented for a single resident, as No. 214 was.
And not all of the ex-utility sites have hung on for as long, such as a 5-story version at Midtown's 158 Madison Ave. that served as the last office and studio of pop artist Andy Warhol before his 1987 death and that was later razed. A 42-story luxury rental tower from a team led by J.D. Carlisle Development Corp. looms there today.
Leases
Marketing firm moving to Penn District
Address: Penn 1, Manhattan
Landlord: Vornado Realty Trust
Tenant: Cheil
Lease size: 37,000 square feet
Lease length: 15 years
Asking rent: $115 per square foot
Asset type: Office
Brokers: Josh Glick, Jared Silverman and Anthony Cugini represented the landlord in-house. Savills’ Nick Farmakis and Kirill Azovtsev represented the tenant.
Sales
U.S. branch of Spanish construction company sells College Point home
Address: 26-15 Ullmer St., Queens
Seller: Judlau Contracting
Buyer: Hallen Construction Co.
Sale price: $31.9 million
Asset type: Office
Canadian developer 99c snaps up Financial District tower
Address: 180 Maiden Ln., Manhattan
Seller: MHP Real Estate Services and Banyan Street Capital
Buyer: Thomas Ta
Sale price: $297 million
Asset type: Office
Financings
Mitchell-Lama co-op in Brooklyn Heights refinances mortgage
Address: 140 Cadman Plaza West, Brooklyn
Owner: Catherine Harris
Lender: New York City Housing Development Corp.
Loan amount: $30.1 million
Asset type: Multifamily
The owner of an East Village residential building that has been mired in controversy and lawsuits for years is ready to tear down the whole thing.
Jeremy Lebewohl, owner of the city's famed Second Avenue Deli, recently filed plans with the Department of Buildings to demolish 642 E. 14th St., a 5-story, 18-unit multifamily building between Avenue B and Avenue C that spans 11,000 square feet. The department had ordered tenants to leave the property in November after construction next door damaged its foundation and caused heavy cracking in its walls, according to city records and reporting at the time.
Multiple engineers have now said the building is dangerous and needs to be torn down entirely, says Lebewohl's attorney, Adam Leitman Bailey. The department is reviewing the application but has not issued an emergency demolition order for the property, according to an agency spokesman.
The building's problems are tied up with construction work on the adjacent lot at 644 E. 14th St., where multiple developers have long been attempting to build a sizable project.
Opal Holdings bought 644 E. 14th St. from the Rabsky Group in 2016 for $23 million with plans for a large residential building, according to property and court records. Lebewohl sued Opal in 2019 over its construction work, claiming it had caused more than $1 million in damages to his building.
Real estate private equity firm Madison Realty Capital then bought the site from Opal in 2020 for about $31.3 million, property records show. The company is working on a project there that will stand 24 stories tall with about 200 residential units and retail space.
Work on Madison's project sparked the November vacate order, local East Village news site EV Grieve reported at the time. A representative for Madison declined to comment on the issues at 642 E. 14th St.
Several of 642 E. 14th St.'s rent-regulated tenants sued Lebewohl in January, claiming that he had known about structural issues at the building for years but failed to repair them. They asked the court to make him fix all violations at the building, let the tenants back into their apartments and prevent him from moving to demolish the property.
The case, which is ongoing, should prevent the city from moving forward on the recently filed demolition permit, according to Paul Messick, an attorney for the tenants.
But Bailey stressed that Lebewohl, who bought the property in 1984 for an unrecorded price, has no choice but to tear down the building, as it has been damaged beyond repair.
"They're small landlords, and even demolishing it is very expensive," he said. "Right now they have to maintain a building that no one can go into, and it just causes one problem after another."
One of the city's most prominent yet under-the-radar real estate families is taking boutique fitness chain Orangetheory to court over what it claims is a broken lease agreement in Brooklyn with about $5 million in unresolved debt, according to court filings made public Thursday.
The Manhattan-based firm ACHS Management Corp., which is run by the Adjmi family, is seeking $5.1 million from the Florida-based workout studio that gained a cultlike following when it made its debut in the city in 2015, and its leading franchisee, an Atlanta-based company called Honors Holdings, which served as the guarantor on the 515 86th St. lease, records show.
ACHS Management filed the suit in state Supreme Court under the private entity CA 531 86th Street, whose Midtown address is the same as the family's company headquarters. Both of the Adjmi family-run firms, ACHS Management and A&H Acquisition Corp, boast extensive portfolios across New York, New Jersey, Chicago and California.
In May 2022 Orangetheory and Honors Holdings signed a lease agreement for the 3,440-square-foot retail space in Bay Ridge to start that November and expire 10 years later, with an annual rent in the first year of $400,000, rising to almost $500,000 in 2032, court records show.
But the high-intensity workout studio never opened, and about a year later both parties agreed to break the lease with the understanding that Orangetheory would pay a termination fee equal to about $39,000 a month for 20 months, records show. That failed to happen, the suit says, and Orangetheory and its guarantor now owe not only $508,950 as part of the termination agreement but thousands more in unpaid rent, for a total of $5.1 million.
It's unclear why Orangetheory never opened on 86th Street — neither the chain nor its Atlanta-based guarantor responded to requests for comment. But according to its website, the fitness studio has plans to try again less than a mile away in the same neighborhood, at 7821 Third Ave.
Meanwhile, the Adjmi family, which, despite its attempts to keep a low profile by taking minority stakes in projects, has made headlines in recent years. Former President Donald Trump pardoned A&H co-founder Alex Adjmi in 2021 after he had spent nearly four years in prison for a previous insurance fraud and money-laundering conviction.
Attorneys for the plaintiff, Arielle Wasserman and Joseph Barbiere of the Manhattan-based firm Cole Schotz, did not respond to a request for comment, and attempts to reach the Adjmi family through its firms were unsuccessful.
New York Community Bancorp raised its beaten-down stock price to a somewhat higher level Friday thanks to a financial facelift.
The struggling bank reverse-split its stock, meaning investors who owned 1,000 shares before now hold 333, although their overall stake didn’t change. Shares traded at $11 each on the New York Stock Exchange this morning, up from about $3.50 yesterday.
NYCB, which was on the brink of failure four months ago before receiving a $1 billion private-capital infusion, said the reverse split “represents another milestone in our efforts to enhance shareholder value.”
The maneuver means the bank is no longer a “single-digit midget,” to borrow a phrase from Wall Street, and while the change is strictly cosmetic, appearances do matter.
“Although the stock split does not change anything fundamentally, we see a marginal benefit as some investors are barred from owning a stock if the share price sits below a certain level,” CFRA analyst Alexander Yokum said.
Yokum added NYCB still faces “outsized funding costs” and “talent attrition concerns.”
Reverse splits happen when companies desperately need to raise their stock price, either to spare themselves embarrassment or to keep their shares listed on an exchange.
Citigroup did a 1-for-10 reverse-split in 2011 to lift its shares out of penny-stock territory. AIG did a 1-for-20 in 2009. WeWork did a 1-for-40 split last year, shortly before sinking into Chapter 11.
A 2008 study of more than 1,600 reverse splits over 40 years showed companies that did them underperformed their peers by 50%. Companies going down this road, researchers found, “experience poor operating performances over the four years that include and follow the year of the reverse split.”
JPMorgan Chase reported record profit as investment bankers and equities traders smashed expectations and the firm took a multibillion-dollar gain tied to a Visa share exchange.
Fees from investment banking soared past analysts’ estimates, jumping 50%, while the firm’s equity traders notched a 21% revenue jump. The Visa transaction added $7.9 billion to second-quarter profit.
More businesses are doing deals again after a long lull, allowing investment bankers to contribute a larger share of their banks’ bottom lines despite the elevated cost of borrowing, lingering uncertainty posed by the upcoming election and global geopolitical issues.
“There has been some progress bringing inflation down, but there are still multiple inflationary forces in front of us: large fiscal deficits, infrastructure needs, restructuring of trade and remilitarization of the world,” Chief Executive Jamie Dimon said in a statement Friday. “Therefore, inflation and interest rates may stay higher than the market expects.”
JPMorgan, Wells Fargo and Citigroup kick off big bank earnings Friday, with Goldman Sachs Group, Bank of America and Morgan Stanley set to report next week. Investors are eager to hear from the industry’s top brass on the state of the economy and expectations for the rest of the year, including the potential impact of elections in November.
Despite notching the highest quarterly profit in the history of American banking, JPMorgan’s results fell short on a few key metrics. Net interest income came in at $22.7 billion for the quarter, up 4% but slightly below estimates, while expenses climbed more than expected. The bank also took its highest provision for loan losses since the early days of the pandemic.
Shares of JPMorgan fell 0.9% in early New York trading. The largest US banks — with the exception of Morgan Stanley — are up more than 20% this year.
Record profit
JPMorgan earned $18.1 billion in net income in the second quarter, up 25% from the previous record a year earlier and ahead of analysts’ expectations.
The bank crushed expectations across its Wall Street businesses: Investment-banking fees soared to $2.4 billion — well ahead of the firm’s own prediction last month. Equities traders also trounced estimates with a jump to nearly $3 billion, which helped bring JPMorgan’s total trading haul to $7.8 billion.
NII — the difference between what banks earn on their assets and what they pay on debts — at the four largest lenders surged to a record last year, fueled by higher interest rates. But analysts are predicting the second quarter will show a second straight drop.
JPMorgan reiterated that it expects to earn about $91 billion in NII this year. It had lifted that guidance in May, citing expectations that the Federal Reserve will lower interest rates at a slower pace than what was expected earlier in the year.
A Chinese artist's plans to convert an industrial building in the Garment District into a 66-unit condo so far hasn't been a pretty picture.
A lender has moved to seize 335 W. 35th St. after a plan by painter T. F. Chen to shield the only-partially-redeveloped prewar structure from creditors through a bankruptcy protection filing appears to have fizzled.
On Thursday Shanghai Commercial Bank filed a lawsuit against entities controlled by Chen to end a long-running legal saga and foreclose on the stalled project, for which Chen apparently owes $68 million in missed mortgage payments, according to the Manhattan Supreme Court filing.
Arguing that Chen and his family agreed long ago to surrender their property if they ever defaulted, Shanghai Commercial is asking a judge to pave the way to transfer the site back to the bank and force them to comply with their obligations.
Chen, a portraitist whose art includes takes on famous works by Cezanne and Van Gogh, has not yet filed a formal response to the complaint.
But even as the bank is a step closer to grabbing the property, Shanghai Commercial still faces a $1.6 billion countersuit from the Chens for allegedly steering the family into loans with what they call deceptive and unfair terms, including personal guarantees.
“The foreclosure process does not change our clients’ legal position,” said Chen lawyer Leo Jacobs, whose website touts him as a “legal psychiatrist to billionaire real estate developers.”
In 2016 Chen and his family purchased 335 W. 35th for $50 million and three years later won state approval to begin sales for a condo called The Society House that would have hauled in about $91 million, according to its offering plan. Studios started at $775,000.
According to court filings, Shanghai Commercial Bank issued $61 million in several mortgages for the project, which is between Eighth and Ninth avenues near Penn Station. But Chen never paid off the loans when they matured in 2021 and also failed to make any payments after two subsequent deadlines, the bank claims.
The Chens owe $56 million in unpaid principal plus $12 million in interest, according to the lender.
The Society House faces a tall stack of unpaid bills. Queens-based Millstone Construction, for instance, says the Chens still owe the company $1.6 million, according to court filings, though the Chens claim the contractor is overcharging the family.
The condo, which is enveloped in construction-site-style safety netting, faces other challenges. The Chens owe almost $4 million in unpaid property taxes for the site after not having paid any since May 2022, according to public records.
And a stop-work order exists at the property, which has more than three-dozen unaddressed Department of Buildings violations, according to public records, though the developers have resolved other violations.
As the bank initially moved to foreclose in January, the Chens filed for Chapter 11 bankruptcy protection for the site, a fairly common strategy to protect endangered real estate. A couple of months later, the family similarly turned to the courts to protect 250 Lafayette St., a small SoHo commercial building housing the Chen’s 23-year-old nonprofit galley space, T. F. Chen Cultural Center, as well as the clothing boutique New York or Nowhere.
The building, which the Chens bought for $600,000 in 1995, according to the city register, was used as collateral for some of the Society House loans. That separate bankruptcy case remains unresolved.
But on July 2 Judge John Mastando of the U.S. bankruptcy court of the Southern District said Shanghai Commercial could restart its efforts to seize the stalled condo.
T.F.Chen, whose full name is Tsing Fang, and his wife, Lucia, immigrated to the Washington, D.C., area from Taiwan in 1980, according to the center’s website, and the couple operated art galleries in D.C. and Lower Manhattan through the years. Their daughter, Julie, and their son, Ted, who work at the family firm, are also named as defendants in related Society House litigation.
Lucia Chen, who handles art sales for her husband, has staged more than 200 shows of his, the site says, while also becoming “a very successful real estate mogul and entrepreneur.” But she doesn't ever seem to have undertaken residential development before Society House.
Jesse Loffler, the bank’s attorney, declined to comment.
Federal prosecutors have indicted a pair of former postal workers for a check-cashing scheme that bilked more than $4 million dollars in government checks from a JFK Airport mail facility, according to court records unsealed this week.
Following a 21-month investigation, law enforcement officials accused Queens-resident Kevaughn Wellington, 31, and a New Jersey-based accomplice, Ky-Mani Straker, 24, of allegedly stealing some 125 checks intended for people receiving COVID-19 stimulus funds, Social Security benefits and tax refunds, court records show.
Breon Peace, U.S. Attorney for the Eastern District of New York, described the operation as “one of the biggest thefts at John F. Kennedy International Airport.”
Prosecutors, in a nine-page indictment, outlined how Wellington, Straker and others allegedly pilfered the government checks between roughly June 2021 and August 2023.
Both Wellington and Straker worked at the mail facility in JFK where parcels are sorted for distribution locally and abroad. As part of Wellington’s position there, he was responsible for opening and sorting sacks of mail, and he helped himself to some of the parcels containing checks that were then sold off for others for cash, according to prosecutors.
In one November 2021 communication, Wellington sent an image of a U.S. Treasury check to Straker. In another message that month Wellington shared a list of checks he said he was willing to sell, along with the value of the stolen checks and the amount he wanted for each of them — in some cases that was 30% of a check’s value. Some of the checks exceeded $1,000.
Straker, in one August 2022 message, shared images of four checks with Wellington, stating “[t]his from the last batch I picked up,” according to court records.
Prosecutors have charged Wellington and Straker with conspiring to steal government funds, theft of government funds and possession of stolen mail, among other charges.
Both men were arraigned and released on bond in Brooklyn federal court Wednesday.
Raymond Kessler, once known as "The Haiti Kid," remembers the cheers as he wrestled professionally against opponents like Hulk Hogan. Today, at 76, the roaring crowd is replaced with his neighbors at The Woodstock Hotel. Kessler is one of 290 tenants in the permanent housing facility owned by Project FIND, which has been improving seniors’ lives for over 50 years.
His arc underscores a profound truth: anyone, regardless of past success, can find themselves in need of affordable housing. And as housing becomes increasingly scarce, we applaud efforts to bolster housing security via The City of Yes for Housing Opportunity plan.
City of Yes is a planning framework to boost housing production in the city. We commend Mayor Adams’ bold vision, inspiring hope for a more accessible future for all. However, no legislation is perfect to start. Currently, certain provisions may have unintended consequences, especially the Universal Affordability Preference (UAP), which replaces the Voluntary Inclusionary Housing (VIH) program.
VIH preserves affordable housing stock and provides capital to maintain quality living environments. The plan’s 10-year phase-out of density bonuses and other changes, though well-meaning, may harm organizations like ours, which depend on these incentives to build and operate housing for middle- and low-income communities.
Importantly, the plan lowers the bonus ratio in R10 districts. The city currently permits developers to build beyond the maximum ratio of building-size-to-footprint for providing certain public benefits, like affordable housing units. City of Yes lowers this ratio, increasing construction costs without offsetting them – disincentivizing developers from building additional affordable housing units. Removing certificates, a funding source for non-profit developers, exacerbates this.
The City of Yes’ impacts are not theoretical, they have real-life consequences. With VIH funding, we are installing needed upgrades at our Upper West Side Hamilton House location, like a new boiler, updated electrical, and free Wi-Fi. These improvements enhance tenants’ quality of life, particularly for seniors with mobility challenges or who remain unconnected to modern technology. Removing that critical funding source would jeopardize our ability to complete those upgrades. Similarly, the Woodstock Hotel, where Kessler lives, direly needs modernization that would be threatened by proposed changes in the City of Yes. Improvements like new elevators and ADA-compliant bathrooms may not happen, as they depend on the sale of air rights under the current VIH program. However, the City of Yes risks drying up the market for this valuable asset. Further, the potential lost value of unsold air rights would negatively impact our balance sheets and negate our ability to finance future affordable housing development deals.
Given these concerns, the City Planning Commission and City Council must carefully amend City of Yes policies. While its goals are commendable, certain policies must be tweaked to ensure they don’t accidentally decelerate affordable housing production.
Raymond Kessler’s story reminds us that real people are impacted by these policies – and that preserving incentives helps sustain affordable housing access for those like him. Industry experts and experienced developers must be heard to avoid unintended negative consequences that prevent New Yorkers from accessing the housing they need and deserve.
As Mayor Adams addresses housing scarcity, developments like Project FIND’s must be protected. Keeping provisions like density bonuses in R10 districts and maintaining existing certificates’ value will enable the City of Yes to produce more affordable housing.
This proposal can be a force for good. But without addressing these concerns, it risks doing more harm than good. Let us take time to get this right so the City of Yes lives up to its name.
Mark Jennings is the executive director of Project FIND, a non-profit that operates four supportive housing residences. He is also an adjunct professor at NYU's Silver School of Social Work.
New Yorkers have paid 58% more in food-delivery fees since before a minimum-wage law went into effect in late 2023, according to a city agency report, suggesting that restaurant-delivery services have passed on the bulk of these rising costs to customers.
While merchants also paid more fees to food-delivery services offered by Uber Technologies, DoorDash and Just Eat Takeaway, the parent of Grubhub and Seamless, it is customers who are bearing the brunt of the impact. People who placed orders through such apps paid an average of $20.1 million a week in delivery fees during the first quarter of 2024 — a 58% increase from a year prior. By comparison, fees paid by participating restaurants increased 13% over the same period.
The report, released Thursday by the New York City Department of Consumer and Worker Protection, shows that food-delivery couriers’ overall earnings grew, even as tips fell sharply. Wages rose to an average of $19.26 an hour, an increase of 64% from a year earlier, before the minimum-pay rule became law. Tips declined by 60% in the same period.
The city’s findings underscore the impact felt by consumers and local business owners as food-delivery companies defend their margins against new regulations in various markets.
Uber Eats, DoorDash and Grubhub all responded to the new minimum-wage rule late last year by raising service fees and modifying the in-app tipping function so that the upfront delivery cost would seem lower. The companies have also implemented scheduling systems to limit the number of couriers working at a given time.
The report also found that the number of contractors delivering food fell 9% in the first quarter from a year earlier. Representatives from Uber Eats, Grubhub and DoorDash point to the decline as proof that the minimum-pay model isn’t working.
“This rule is a job killer and the antithesis of why millions of people choose app-based work,” said an Uber spokesperson, claiming that Uber Eats has 12,000 fewer workers than before the rule went into effect and that “the couriers who are still able to work need to work much harder, doing 80% more deliveries per hour than they did” before the rule change.
A Grubhub spokesperson said in a statement that “DCWP predicted in its 2022 study that couriers would earn more, but that earning opportunities would be concentrated in fewer hands,” adding that the report “shows that this is true.”
A representative for DoorDash called the minimum-wage policy “extreme and broken,” adding that the rule has led to increased costs for customers, which translates to fewer orders and fewer earning opportunities for couriers.
“We will continue what we’ve been focused on since these policies took effect — working to find a better approach that works for Dashers, merchants and customers alike,” DoorDash said in a statement.
DoorDash, the largest food delivery service in the US, downplayed the impact of new minimum-wage rules in cities like New York and Seattle in its latest earnings report, saying it saw less than a 1% reduction in orders in those two cities.
Meanwhile, Thursday’s report suggests that orders have been broadly increasing, not decreasing. Delivery workers completed about 2.8 million deliveries per week in the first three months of the year, according to the DCWP — an 8% jump from the same time period a year earlier.
“These strong results show yet again that we don’t have to make the false choice between business growth and workers’ rights, said Ligia Guallpa, the executive director of the Worker’s Justice Project, a nonprofit that lobbied for the minimum-pay legislation.
Look out golf: Pickleball is coming for your corporate schmoozers.
While golf courses have long been hailed as the premier venue for closing deals and wooing clients, a growing number are finding that pickleball saves them time and money — while being more inclusive and easier to play for newcomers. Corporate bookings at pickleball clubs across the U.S. spiked in June from the previous month, according to PodPlay, a sports venue booking platform.
Individual pickleball club operators back this up, saying that company events are increasing exponentially. Ace Pickleball Club, with locations in various states, has had a steady flow of corporate gatherings, co-founder Joe Sexton said, with event requests at new locations piling up even before they open. Greg Raelson, chief marketing officer of Pickleballerz club in Chantilly, Virginia, said corporate bookings have roughly tripled since 2021. In New York, Life Time Fitness is fielding 10 to 20 corporate booking inquiries per week — more than five times last year’s volume.
The court is becoming especially popular among lawyers, bankers and realtors looking to expand their professional circles. In Rochester Hills, Michigan, pickleball instructor Robert Dunn said he sees lawyers with clients, business types talking shop and auto industry executives bringing suppliers and purchasers to play. “Even if the intent isn’t business, business is often a topic of conversation,” Dunn said.
Chicago-based real estate broker Colin Hebson said he’s observed a similar trend and has become a convert himself after using the golf course to entertain for 25 years. A key part of the appeal is that pickleball is much less intimidating than golf for those who haven’t played before.
“If you’ve never golfed before and I invite you on the golf course because I want to network with you and do business, it’s almost impossible to be able to keep up,” he said. “I can take someone onto the pickleball court who has never touched a pickleball paddle before, and I can show them how to play and they would have a good time in under 10 minutes.”
It’s also much more efficient: Hebson can finish a couple of games of pickleball in under two hours, versus taking half the day to golf. To top it off, two hours at Hebson’s pickleball club cost $80, versus $600 to $700 to entertain on the golf course.
Mathew Norman, senior director of events at a South Carolina pickleball club called Crush Yard, said companies are seeing a greater return on investment with pickleball. “Everyone involved spends more time with each other under one roof and the event time is a max of three hours instead of five,” he said. This allows executives to schedule events starting around 4 p.m., so staff can still work most of the day. So far this year, Crush Yard said it has already put on 10 events for companies that normally do golf.
Golf, of course, isn’t going anywhere. The sport experienced a surge in popularity during the pandemic, and the National Golf Foundation said recently that on-course golfers have increased for six straight years and golf is gaining popularity with women and people of color. Even with these inroads, 74% of golfers are still men and 78% are white, according to the foundation. This has prompted some die-hard golfers to shift to pickleball in order to tap into a broader and more diverse pool of clients, according to Richard Green, co-founder of pickleball club SPF Chicago.
After noticing that some of their colleagues seemed less than jazzed about an afternoon on the green, executives at one Chicago-based marketing company decided to host a pickleball tournament this year.
“They saw pickleball as a way of reaching out to get more engagement out of employees who don't like to golf,” Green said.
Minneapolis, Minnesota-based life coach Jasna Burza began inviting clients to play pickleball when she realized it would help them to loosen up. Burza, who works with executives, lawyers and entrepreneurs, said it’s a welcome alternative to the golf course for many of the women she coaches. “A lot of my women clients are like, ‘I have kids, I don't have time to spend seven hours on the course,’” she said.
It’s also been transformative for her relationships with clients who do golf, many of whom she used to walk the green with. “There are no pretensions. You see them miss a point. There’s so much vulnerability on the court,” she said. “What I love is that you see adult men and women engaging in trash talk. People are competitive, but it’s not as serious as golf.”
President Joe Biden vowed he would remain in the 2024 presidential race, but two critical mistakes in the span of two hours deepened concerns about his mental acuity that threaten his campaign.
Biden, 81, saw the culmination of this week’s NATO summit as a chance to reassure allies who for two weeks had fretted about his abilities following his first debate performance against Donald Trump. Over a bilateral meeting with Ukrainian President Volodymyr Zelenskyy and a nearly hour-long news conference, he spoke confidently on a range of complex issues from the tax code and trade policy to Russia and the Israel-Hamas war.
But with virtually no margin for error, Biden mistook two of his biggest allies for his greatest enemies.
The president drew gasps — and instant mockery online — when he mistakenly introduced Zelenskyy as Russian President Vladimir Putin at an event in the late afternoon. Then, at the opening of the press conference, he fumbled a question about Vice President Kamala Harris by saying he “wouldn’t have picked Vice President Trump to be vice president” if he did not have confidence in her.
The solo news conference, Biden’s first this year, was designed to show that he has the stamina and adeptness to make a case to voters they should elect him over Trump in November. His dedicated allies said they were buoyed as he took questions from 11 reporters, and displayed more humility than he has in recent days about the difficult political road ahead.
“I’m determined on running, but I think it’s important that I allay fears,” Biden said.
But with viewers hanging on his every word, early signs indicated Biden’s performance was not enough to ease the intraparty turmoil that was set off after his debate against Trump.
Almost immediately after the press conference ended, at least three more House Democrats, including Rep. Jim Himes, the top member from his party on the Intelligence Committee, joined the growing list of lawmakers calling on Biden to step aside.
One member of a NATO delegation said after the press conference that their nation’s leader did not think Biden could survive the crisis consuming his presidency, even though the summit in Washington was generally praised by participants for its substance.
At the same time, Trump met with Hungary’s Prime Minister Viktor Orban — whose recent meeting with Putin in Moscow drew the ire of many NATO leaders — according to an Instagram post on the European leader’s verified account.
Biden’s performance was at times shaky and included some of the hallmarks of the tightly controlled exchanges preferred by the White House, like calling on a list of preselected reporters. But he avoided repeating some of the worst mistakes from last month’s debate.
In some ways, it was a press conference that had something for everyone.
Aides on Biden’s campaign said they believed the performance would make the case to lawmakers who had expressed alarm over the president’s path to victory.
For Trump and his allies, who want Biden to stay in the race, there was enough material to mock — but not a devastating moment that would have knocked the president from the contest. A replacement candidate could blunt some of the inroads Trump has made with young and minority voters disillusioned by Biden’s age.
Trump gleefully seized on Biden mistaking Harris for his predecessor, posting on his social media site that Biden had done a “great job.”
When asked at the end of the news conference for his response to Trump noting his flub, Biden suggested that his rival had said far worse things.
“Listen to him.” he said.
‘Finish this job’
Biden rejected the calls for him to step aside raised by multiple reporters, saying he is “the best qualified person to do the job.” He said he had not handed over the role of party standard-bearer to another Democrat “because there’s so much at stake.”
“I’ve got to finish this job,” he said.
But for one of the first times of his presidency, he conceded that “there are other people that could beat Trump too.” While he said he remained committed to running, he did allow that he might reconsider if “they came back and said there’s no way you can win.”
Biden subsequently downplayed his verbal miscues, pointing to world leaders who had praised the NATO conference as successful.
Still, even Biden acknowledged he may never be able to fully reassure Americans about his competence when asked if he would take a fresh neurological exam.
“No matter what I did, no one’s going to be satisfied,” the president said.
His misstatements followed reporting earlier Thursday by the New York Times that several longtime advisers to the president were discussing ways to persuade Biden to exit the race — and that his campaign is polling how Harris would fare against Trump if she were to take over the top of the ticket.
Spokespeople for Biden insisted his team remained behind him, but the signal that the president’s own confidants may be joining the chorus of outside lawmakers, donors, and strategists calling on him to exit the race amounted to a potentially terminal blow after a bruising week.
“I’m not in this for my legacy. I’m in this to complete the job I started,” Biden said.
The president said his schedule had been “full bore” and that he needed to pace himself, while noting his staff added lots of events to his calendar. But he said he compared favorably to Trump.
“Instead of my — every day starting at seven and going to bed at midnight, what I said was, it’d be smarter for me to pace myself a little more,” Biden said.
“Where’s Trump been? Riding around on his golf cart? Filling out his scorecard before he hits the ball?” he added.
Wary lawmakers
Top White House and campaign officials were dispatched to Capitol Hill on Thursday in a bid to shore up wary lawmakers. Many trickled out of a luncheon for Democratic senators declining to answer questions about the president posed by reporters.
The huddle came a day after two of Biden’s closest congressional allies — Senate Majority Leader Chuck Schumer and former House Speaker Nancy Pelosi – appeared to be nudging Biden toward the door.
Pelosi told MSNBC that Biden needed to decide “if he is going to run.” Axios reported that Schumer privately signaled to donors he was open to dumping Biden, though the New York senator subsequently said he backs the president.
Nearly a year after the city announced an overhaul of funding to facilities known as mental health clubhouses, Mayor Eric Adams’ administration has started rolling out contracts to nonprofits to run the facilities.
The Department of Health and Mental Hygiene awarded $75 million this week to three organizations to operate mental health clubhouses, facilities that offer no-cost support services to people with serious mental illnesses. The facilities do not provide medical services; rather, they serve as recreational centers that offer job training and education, health and legal counseling and social activities such as game nights and meals.
The city awarded two $30 million contracts to New York Disaster Interfaith Services and Goodwill of Greater New York and New Jersey to operate such facilities, as well as a $15 million contract to Phoenix House. The contracts will last for nearly 10 years and begin on Aug. 1.
A representative from the city Health Department did not reply to questions from Crain’s about whether the city has awarded contracts to additional operators.
The Adams administration pledged last year to invest $30 million annually in mental health clubhouses, doubling the city’s previous investment. The plan is an attempt to triple citywide capacity; the mayor said new contracts would boost intake from 5,000 individuals to 15,000 individuals in the next two fiscal years.
But as a result of the overhaul, many smaller clubhouses were ineligible to apply for city funding, as they did not have the required 300 active members. Operators of nine of the city’s 13 existing clubhouses were unable to continue their services under the new plan, which was met with fierce opposition from the nonprofits and local elected officials.
The City Council restored $2 million to keep smaller clubhouses open in its recent fiscal year 2025 budget, which could offer some short-term relief to smaller providers. But its unclear how long they will be able to remain open with the new funding.
MEDICAID EXPANSION: The state Department of Health asked the federal government to greenlight new regulations that would prevent kids under 6 years old from having to continuously reapply to Medicaid and Child Health Plus, the agency said Thursday. Officials submitted an 1115 waiver to alter its Medicaid program, in hopes of preventing kids from losing public health insurance coverage due to changes in family household income. If approved, the waiver will extend through 2027, and would make New York the fourth state to offer continuous coverage to children in the U.S., the agency said.
NEW PAYMENT MODEL: Northwell Health is one of 400 locations participating in a new dementia care payment model being spearheaded by the federal government, the health system announced Friday. The Centers for Medicare and Medicaid Services has selected hospitals to test a payment model to improve care for patients with memory conditions and provide respite services to caregivers to delay the need for care in a long-term care facility. Mount Sinai Health System was also selected to participate in the program.
ICYMI: Nearly 200 people have been infected with dengue fever in New York and New Jersey, according to data from the Centers for Disease Control and Prevention. Dengue fever, which is transmitted by mosquitoes, is common in tropical climates. Normal symptoms include fever and body aches, and more severe symptoms may require hospitalization. The CDC released a health alert last month warning of an increased risk of infection.
The 988 mental health hotline has yielded murky results in its first two years in operation, despite millions in funding.
The city’s Department of Health and Mental Hygiene issued a $82 million contract on Wednesday to Vibrant Emotional Health, a Financial District-based nonprofit that administers the 988 hotline nationally. The three-year contract funds the nonprofit’s continued operation of the call, text and online chat tool, which aims to connect individuals in crisis with mental health professionals.
State officials have also invested millions in the program. Since the launch of the hotline two years ago, Gov. Kathy Hochul has allocated $155 million to its operation, according to James Plastiras, a spokesman for the Office of Mental Health.
But despite investments, New York’s program faces continued challenges. Workforce shortages have stalled the city and state from being able to fully staff clinician roles. And a lack of public awareness campaigns have resulted in very few people knowing what the hotline is for.
Roughly a fifth of the population nationwide knows about the 988 hotline, a percentage that is far too low, according to Glenn Liebman, CEO of the Mental Health Association of New York State.
“People don’t know that there’s a trained clinician waiting for them at no cost,” Liebman said. “Until it’s 100% awareness, we’ve got a long way to go.”
The federal government rolled out the 988 mental health line in July 2022 in an effort to shorten the national 10-digit suicide lifeline and offer a non-police involved mental health crisis response system. The hotline has been lauded by advocates as the “gold standard” of mental health care, as it connects individuals to rapid support and follow-up crisis care.
City and state programs have logged thousands of calls in the two years following the rollout. New York state’s 988 hotline has received nearly 430,000 calls, texts and chats between May 2023 to May 2024, according to data from the Office of Mental Health. It responded to roughly 82% of those contacts within the year-long period.
The city has also seen its call volume increase since the hotline launched two years ago. The city’s 988 center responded to just over 44,000 calls, texts and chats in August 2023, the most recent month that data is available. The city declined to provide the number of calls, texts and chats it received to the line nor a rate indicating how many incoming contacts received mental health support.
Mental health clinicians and advocates have embraced New York’s efforts to ramp up the 988 hotline, pointing to the challenges of managing a large system. But public awareness remains a challenge that limits the number of people that this resource can serve.
Matt Kudish, chief executive officer of the National Alliance on Mental Illness in New York City, said that “significant investments” should be made to improve public awareness to a crisis response system that doesn’t involve police, to encourage people of color and marginalized groups to use the resource.
“If folks don't know to call 988, they're going to call 911,” Kudish said. “We believe strongly that there's no place for police response in a mental health crisis.”
Pfizer is moving forward with a weight-loss pill as the drugmaker seeks to crack the multibillion-dollar market for obesity medications and mount a comeback from its post-pandemic malaise.
The once-daily treatment, called danuglipron, will progress to a mid-stage study in the second half of this year, Pfizer said Thursday, having cleared a scientific hurdle in a small study. The next trial will be designed to find an ideal dose of the pill, Pfizer said, and the drug will move into the final stage of development if it succeeds.
Pfizer shares rose nearly 3% before paring back in early trading in New York.
The pill is designed as a needle-free alternative to popular weight-loss shots from Novo Nordisk A/S and Eli Lilly & Co. Pfizer has said it expects pills to eventually capture about a third of the obesity drug market, which analysts have predicted will grow to about $130 billion by the end of the decade. The pill is designed to mimic the effects of Novo’s blockbuster injectable semaglutide, sold as Wegovy and Ozempic.
Pfizer has struggled to make headway in treating obesity. Late last year, the company halted development of a twice-daily version of danuglipron after high rates of nausea and vomiting led patients to drop out of a mid-stage study of about 1,400 people. Months earlier, it abandoned another oral obesity drug that showed concerning liver effects in a trial.
The company is years behind Novo and Lilly, whose weekly Zepbound shot is poised for blockbuster sales after gaining US approval last year. Lilly also has an oral obesity treatment in the final stage of development. AstraZeneca Plc, Structure Therapeutics Inc., and other companies are also developing oral drugs.
Small study
Pfizer studied the once-daily version of danuglipron in a trial enrolling just 20 people, according a federal registry, testing four formulations of the drug to determine which might be most effective. The company did not disclose detailed results of the study, saying only that it was moving forward with one of them.
If the pill is successful it could ease some of the pressure on Pfizer Chief Executive Officer Albert Bourla, who has struggled to persuade investors that the company’s pipeline of medicines can eventually arrest its post-pandemic decline. Sales fell 20% in the first quarter of 2024 as demand plummeted for its Covid-19 vaccine and pill. Pfizer’s financial forecast for this year came in well below Wall Street’s expectations and its vaccine for RSV has underperformed.
Initial reaction from analysts remains muted, however. Pfizer’s long-awaited update on its obesity pill reveals little, and in a best-case scenario the drug could only be launched in 2028, “at which stage multiple competitors might be available,” said Sam Fazeli, director of research at Bloomberg Intelligence.
“Progress here has been slower than expected and offers nothing for now to assess potential competitive positioning,” Fazeli said.
New York City’s political class will be anxiously refreshing their web browsers on Monday, when fundraising numbers are released that will show the strength of Mayor Eric Adams’ potential primary challengers and could determine whether others enter the race.
Monday’s disclosures will reveal how much money each candidate in the 2025 elections raised between Jan. 13 and July 11 of this year. That includes Adams and his two likely rivals, former Comptroller Scott Stringer and State Sen. Zellnor Myrie, both of whom may choose to make their tentative campaigns official if they can report a strong haul.
“Anyone that’s paying attention to New York City politics has this date squarely marked in their calendar,” said Austin Shafran, a Democratic political consultant. “It is the start of the 2025 election cycle and it’s the first real test of strength and viability for candidates running next year.”
Among those watching the returns will be City Comptroller Brad Lander, who has reportedly told allies he may launch his high-profile campaign against Adams this month after gauging the strength of the other Democratic primary challengers. The progressive Lander will report his own fundraising haul on Monday, ostensibly for re-election as comptroller, but he could switch that war chest to a mayoral run at any point.
Since Lander would need to give up his comptroller seat to run for mayor, his campaign would trigger a musical-chairs scenario of other lawmakers and borough presidents seeking his current seat, creating even more vacancies and adding to the intrigue of Monday’s disclosures.
Mayor Adams raised about $525,000 in the most recent six-month fundraising period between July 2023 and January 2024, a dip from previous cycles that was caused in part by his campaign’s decision to pause active fundraising for a few weeks after the FBI raided the home of his chief fundraiser. But a few consultants reached for comment Thursday hesitated to put a precise dollar figure on what Adams and his rivals should be expected to raise this period, given the unprecedented nature of the current state of play: an incumbent mayor facing multiple serious challenges nearly a year out from the June 2025 primary.
But it’s safe to expect a reasonably strong haul for Adams — who raised a total of $19 million in combined private and public matching funds during his 2021 campaign — even as he faces slumping approval ratings and the competing task of raising money for his legal defense fund.
“I’d be surprised if he doesn’t have a strong filing,” consultant Chris Coffey said of Adams. Stringer, too, has long been known for money-raising prowess, while Myrie has made himself increasingly visible online in recent weeks in an apparent effort to solicit small-dollar donations. (Donations below $250 from New York City residents are matched 8-to-1 under the city’s matching funds program, a huge consideration for candidates.)
Former Gov. Andrew Cuomo’s potential entry into the race, seen as likely by some observers, would only complicate things further. (Myrie, for his part, may end up with a lower bottom-line total than his rivals, since he only began fundraising in May compared to January for Stringer.)
Disclosure reports are expected to be posted early Monday by the city’s Campaign Finance Board, although some campaigns may choose to announce their totals ahead of time.
Besides the raw dollar value, Monday’s disclosures will also reveal the names of donors, giving insight into which people are willing to take the bold step of betting against the current mayor, noted longtime consultant Hank Sheinkopf.
“There are those who say that this is not a blood sport, but no one forgets anybody that writes a check against an incumbent,” Sheinkopf said.
Adams, despite suffering from approval ratings as low as 28%, still enjoys advantages over his rivals, including support from labor unions and more than $2 million already on hand for his re-election. More than anything, the upcoming filings may pit the challengers against each other rather than against Adams, with some progressive strategists and activists already mulling over whether to consolidate around the most viable candidate to unseat the incumbent.
“What we're looking at is not, ‘Where does Eric Adams stand among the field?’” said Shafran, “but where does the field of challengers stand among each other?”
The developer behind a pair of residential buildings on the Long Island City waterfront wants to rework the southern shore of a just-built project with a rocky barrier to defend the area from flood waters and is pointing the finger at climate change.
Real estate giant TF Cornerstone has proposed to city planners that it build “an undulating edge of cut granite stones” along the southern waterfront of its 1.43 million-square-foot development at 2-20 and 2-21 Malt Drive as a barrier to protect the shore from erosion caused by waves, according to documents filed with the Department of City Planning on July 5.
The development team said the proposal comes after “damage was caused by the inundation of wave action and higher than expected flooding levels” to plantings and the stone rubble used to bolster the site’s southern shoreline.
Only two months earlier a landscape architect working on the project, Kate Orff, touted the site’s waterfront resilience in a statement, stressing that the site’s waterfront park, which runs along Newtown Creek, on the southern edge of the site was “designed to be resilient long into the future, withstanding flooding events and filtering the water of the creek through its plantings.”
TF Cornerstone declined to comment on its proposed barrier and would not say if the developer anticipates needing to make additional waterfront adjustments in the years to come. It’s unclear how much monetary damage the development’s coastline suffered from erosion.
“Since sea levels are continuing to rise as a result of climate change, wave action and flooding will only continue to worsen in this area,” argues the development team, which is listed as Bud North LLC and Bud South LLC, in its proposal.
Manhattan-based TF Cornerstone is no stranger to waterfront development in Long Island City, with several luxury residential buildings on Center Boulevard along the neighborhood's shoreline.
TF Cornerstone’s latest Malt Drive development was raised to help protect the property from nearby waters. The development is made up of two buildings designed by SLCE Architects, a 33-story high-rise and a building with two towers (25 stories and 38 stories) on a shared base.
The developer is set to begin leasing its 1,386 residential units this summer, including a few hundred apartments that are up for grabs through the city’s affordable housing lottery.
McKinsey is opening an office in Darien, becoming the latest company to converge on a wealthy Connecticut town that’s fast becoming a miniature version of nearby Greenwich.
The consulting firm joins financial companies in Darien such as Crestwood Advisors and Janney Montgomery Scott, which have taken space in a revitalized and expanding downtown that’s seeking to attract bankers who want to stop commuting into New York City.
The rise of little Darien, the richest town on Connecticut’s Gold Coast, has become symbolic of the increased demand for state-of-the-art work spaces that are far from urban cores and closer to where many employees live. While office values have tumbled nationwide since the pandemic, Darien’s office leasing surged 164% last year, according to real estate brokerage CBRE Group Inc.
“As our Connecticut-based colleagues and clients have been innovating their work arrangements, to be closer to both, we have made the decision to continue growing our team in Darien,” McKinsey said in an email. “We’re eager to further develop our presence in Connecticut.”
The firm has expanded in recent years in some of the areas that have benefited from rising business activity and population during and after the pandemic. In Miami, for example, McKinsey has grown to 400 employees from 100.
In Darien, the new offices will serve 260 McKinsey employees who will be relocated from nearby Stamford. The Metro-North Railroad station in Darien is a short walk to downtown, while Stamford is lacking in new, upscale buildings within walking distance of the train.
Darien’s growth has fueled comparisons to nearby Greenwich, a longtime favorite with powerful hedge funds but a town that’s perennially short on office space. It’s happening on a far smaller scale, however. Darien, with a population of just 22,000, has only about a fifth of Greenwich’s space.
Closely held McKinsey, which said it generated a record $16 billion in revenue last year, has about 45,000 employees around the world and has advised everyone from the Pentagon to China’s Ping An Insurance.
But consulting firms are facing industry headwinds, and last year McKinsey embarked on a plan to eliminate about 1,400 roles. More recently it warned about 3,000 consultants that their performance would need to improve.
In addition to McKinsey, investment manager Balance Point Capital has also signed a lease with Baywater Properties, the developer of the remodeled downtown known as the Corbin District.
Earlier this year, insurance giant Aon Plc also announced new space in Darien.
The $360 million mortgage for Goldman Sachs’ former headquarters at 85 Broad St. is a “loan of concern,” Fitch Ratings said.
Goldman developed the 1.1 million-square-foot building in 1983 to house its entire workforce of 1,500 before moving out in 2010 for new headquarters on West Street. Only two years after development, the firm sold the tower for $310 million to MetLife, which in 2014 sold a piece to Beacon Capital Partners and the co-owners upgraded the 30-story building described as an “ungainly bulk” by the "AIA Guide to New York City."
The owners spent $36 million on renovations, which paid off when WeWork agreed in 2015 to lease 300,000 square feet, or approximately eight floors, through 2033. The up-and-coming office coworking firm paid $46 a square foot, which was 17% below market rate. Others moved in, including Nielsen Holdings and Vox Media, owner of New York magazine and The Verge. In 2017, 85 Broad was acquired for $650 million by Ivanhoé Cambridge, a subsidiary of Canadian pension fund Caisse de dépôt et placement du Québec.
85 Broad was 20% vacant at the end of last year, better than some Financial District buildings but a big change from its prepandemic 6%. Fitch said in a report last month that mortgage investors face a 12% loss, or $43 million over the entire loan.
“The loan was flagged as a loan concern due to exposure to WeWork,” Fitch said.
Around the time WeWork emerged from bankruptcy this spring it had moved out of 120,000 square feet, or three floors. Since then the firm has vacated another two floors and is negotiating with its landlord over the remaining space, a spokeswoman said. That could mean further reductions in rent.
In 2022 Bloomberg News reported that Ivanhoé was nearing a deal to sell a piece of 85 Broad to Fortress Investment Group and Metro Loft, Nathan Berman’s firm that specializes in converting office buildings into apartments. No deal appears to have been struck, and Ivanhoé didn’t return a request for comment.
85 Broad’s lobby contains a portion of New Amsterdam’s stadt huys, or town hall, from the early 17th century. Dutch and British officials along with Mayor Ed Koch and Gov. Hugh Carey attended the building’s ground-breaking ceremony in 1980. Goldman grew into a global financial institution and employs 45,000 worldwide.
As a work of architecture the building wasn’t as successful, however. 85 Broad’s tan cast-stone walls were intended to harmonize with the Fraunces Tavern block’s historic facades. But Goldman’s decision to build taller, using air rights acquired from the tavern and others, spoiled the effect.
“Harmony? Certainly not in scale,” the AIA Guide grumbled, “and the relationship of materials is a joke.”
Brothers Isaac and Eli Chetrit are at risk of losing one of their properties — a historic SoHo building — to foreclosure, according to court papers filed this week.
Thomas Hooker, associate general counsel of Manhattan-based Maverick Real Estate Partners, filed the action under the limited liability company SoHo Mixed Use in order to take over the 5-story retail property at 447 Broadway after the duo defaulted on a $14.3 million loan, court documents say. The building sits within the SoHo-Cast Iron Historic District between Howard and Grand streets.
The defendant named in the suit is the corporation Zahava Realty, whose 25 W. 36th St. address is the same as the Chetrit's well-known real estate group AB & Sons.
The Chetrits, who originally bought the building in 1997, according to city records, but it's unclear for how much, took out the mortgage from their original lender, Signature Bank, in 2017, which was then transferred to the plaintiff this past February, court records show; and according to the lawsuit, there is an unpaid principal balance of $13.6 million, plus interest.
The suit also names three of the building's tenants, Lipman Studio, Pocco Paradiso and JSG Broadway Eats — whose monthly rents ranged from $19,000 to $29,500 — but it's unclear if they still occupy space in the property.
An attorney for the plaintiff, Michael Bonneville, a partner at the Manhattan-based firm Kriss & Feuerstein, declined to comment on the suit. The Chetrits don't have an attorney on file, according to court papers, but when reached by phone Thursday, Abraham Chetrit — Eli's son — declined to comment.
Leases
Commercial brokerage extends Midtown lease
Address: 200 Park Ave., Manhattan
Landlord: Irvine Co.
Tenant: CBRE
Lease size: Approx. 180,000 square feet
Asset type: Office
Sales
Boerum Hill 28-unit rental development changes hands
Address: 82 Fourth Ave., Brooklyn
Seller: Abraham Posner
Buyer: Ben-Josef Group Holdings
Sale price: $20 million
Asset type: Multifamily
Rental tower Rose Modern trades in Yorkville
Address: 1394 York Ave., Manhattan
Seller: Robert Ohebshalom
Buyers: Stockbridge Capital Group and Fetner Properties
Sale price: $62.6 million
Asset type: Multifamily
Stephen Ross, developer of Hudson Yards, is stepping down as chairman of The Related Cos. to focus on business in Florida, according to The Wall Street Journal and an internal company memo obtained by Crain's.
Ross, 84, is one of the largest owners of downtown West Palm Beach commercial space and plans to spend more time tending to the NFL's Miami Dolphins, which he owns, and his interest in Formula One racing, according to the report. His new enterprise will be called Related Ross.
His successor at Related will be longtime CEO Jeff Blau. President Bruce Beal and Chief Operating Office Kenneth Wong will stay at Related as well. Ross is also maintaining a substantial stake in the company and will have the title of non-executive chairman going forward.
"As many of you know, Stephen relocated to South Florida and has dedicated his time to his extensive work in both West Palm Beach and with his sports properties in Miami," the executives wrote in a company memo announcing Ross' departure. "With all of his focus in South Florida, he's now formally turning to it full time."
The memo stressed that this has been an orderly transition and that Ross leaving will not impact anyone's day-to-day job very much. The overall focus of the company will remain the same, it said.
Related declined to comment on Ross' departure.
The Related Cos. was founded by Ross 52 years ago and owns $60 billion worth of property nationally. It has teamed up with Wynn Resorts to try to get a casino approved for Hudson Yards.
Support for President Joe Biden’s candidacy is cracking in one of the party’s key pillars: New York.
Lt. Gov. Antonio Delgado, who says that Biden “deserves our eternal gratitude” for his nearly four years running the country, called for him to end his campaign for reelection and make “room for a new leader.”
That came just hours after Hudson Valley congressman Pat Ryan, a rising star in the party, issued an unequivocal call for Biden to step down from the race against former President Donald Trump.
“Trump is an existential threat to American democracy; it is our duty to put forward the strongest candidate against him,” Ryan, who won a special election for his swing district seat in 2022, posted on social media. “Joe Biden is a patriot but is no longer the best candidate to defeat Trump.”
Even Senate Majority Leader Chuck Schumer has signaled concern to donors that he’s open to replacing Biden, Axios reported, citing people familiar with the matter.
While a majority of the state’s Democratic delegation and some of its most senior politicians, including Gov. Kathy Hochul and Mayor Eric Adams, continue to offer full-throated support to Biden, dissent is growing publicly and privately. It’s a remarkable moment for the Empire State, the country’s media capital and home to a sizable bloc of the party’s most prolific donors — as well as the two Democratic US Congressional leaders, Schumer and House Minority Leader Hakeem Jeffries.
The divisions aren’t neatly divided by ideology, geography or how safe the politicians’ seats are in November, underscoring the complex fractures and calculations within the national Democratic party since the 81-year-old president’s disastrous debate performance last month against Trump.
“This is unprecedented,” said Christina Greer, an associate professor of political science at Fordham University.
Deeply personalFor some Democrats, the calculus is deeply personal as they decide whether to abandon a man whom many respect and have worked with for decades. Others are thinking strategically about whether the party can coalesce around another candidate with just weeks until the Democratic National Convention in Chicago, Greer said.
“What would it look like to change course now?,” she said. “What would it look like to stay with a candidate who some argue had one bad night while others argue it’s part of a much more concerning pattern?”
That’s an issue raised by Bronx Democratic Congressman Ritchie Torres, who used social media to question how Biden staying in the race will affect the party’s efforts to regain control of the House.
"In determining how to proceed as a party, there must be a serious reckoning with the down-ballot effect of whomever we nominate. What matters is not how we feel but what the numbers tell us. An unsentimental analysis of the cold hard numbers—which have no personal feelings… — Ritchie Torres (@RitchieTorres) July 10, 2024"
Pressure is now mounting on party leadership to exert more control over the rank and file as Schumer and Jeffries tread carefully in their public statements.
Schumer, asked repeatedly about whether he still supports the president, has stuck to his careful, three-word answer: “I’m with Joe” including repeating the phrase after the Axios report. In a brief statement later released by his office, Schumer reiterated his support, which he said he has made clear “repeatedly publicly and privately.”
Jeffries has said he supports the president but hasn’t done much publicly to quell dissent. He stirred speculation that he was leaning against Biden when he posted to X a Bible verse that follows a passage in which Moses dies of old age and a younger leader takes over. The congressman’s allies insisted he hadn’t meant to imply anything about the president.
There are even concerns that New York, which Biden won by 23 points over Trump in 2020, could possibly be competitive in the presidential race. Polls show the president’s lead in the state narrowing, leading to panic among some officials and consultants, Politico reported Wednesday.
‘Extremely Receptive’Even as Biden faces growing calls to abandon his reelection bid — Vermont Democrat Peter Welch on Wednesday became the first sitting senator to publicly urge him to leave the campaign, while actor George Clooney issued a similar plea — there’s still a powerful bloc of New Yorkers who are holding firm in their support.
Alexandria Ocasio-Cortez, the progressive who represents parts of the Bronx and Queens, has been one of Biden’s most vocal surrogates as he tries to appeal to more left-wing and younger voters in the party. It’s a hugely important role as Democrats look to rally voters in swing states disaffected over Biden’s support of Israel amid the war in Gaza.
“The matter is closed,” Ocasio-Cortez said earlier this week. “Joe Biden is our nominee. He is not leaving this race. He is in this race, and I support him.”
Biden has also garnered public shows of support in recent days from the Congressional Black Caucus and Congressional Hispanic Caucus. Brooklyn Congresswoman Yvette Clarke said CBC “members were extremely receptive,” to Biden. “I know I’m team Biden-Harris,” Clarke told MSNBC.
Hochul, who handpicked Delgado as her lieutenant governor and running mate in 2022, was one of the first national politicians to support Biden in the days after the debate.
“Joe Biden is in it to win it,” Hochul said last week outside the White House after a crisis meeting Biden held with Democratic governors.
But other Democrats are having a hard time suppressing worry over Biden’s age and ability to beat Trump, 78, who’s ahead in most national and swing-state polls.
Late last week, Manhattan Congressman Jerry Nadler and upstate Congressman Joe Morelle both expressed serious concerns about Biden’s candidacy, although Nadler later said that Biden is “going to be our nominee, and we all have to support him.” “Whether or not I have concerns is besides the point,” Nadler said.
Renters did not see much relief last month to kick off the summer apartment hunting season, with city rents tying or breaking records in June, according to the latest report from Douglas Elliman and Miller Samuel.
The median rent in Manhattan was $4,300 last month, tying its record high for June, the report says. This was flat year over year and up slightly from May. The average listing discount, meanwhile, reached a new low of -1.4%, meaning a typical apartment went for more than its initial asking price and indicating that bidding wars are becoming increasingly common.
But the high prices didn't seem to slow down activity, as new Manhattan lease signings hit their second-highest level on record for June at 6,775, up more than 30% year over year. Listing inventory similarly rose to the third-highest-ever number of apartments for the month at 9,832, up significantly month over month and year over year.
In Brooklyn, the median rent reached a June record at $3,695, up about 3% month over month and 4% year over year. New lease signings reached their second-highest level on record at 3,760, more than double the amount signed in June 2023 but down 13.4% from May. Listing inventory, meanwhile, rose to its second-highest on record for June at 5,435 apartments, up significantly month over month and year over year.
The median rent actually dropped compared to May and June 2023 in northwest Queens to reach $3,250, although this was still the area's second-highest median rent on record for June. New lease signings rose to their second-highest level on record at 772, a more than 100% increase year over year but down slightly month over month, while listing inventory reached its second-highest level on record for June at 835 apartments, also up more than 100% year over year and a 12.5% increase month over month.
Rents are likely to continue rising over the summer barring a sizable drop in mortgage rates that would move more people out of the rental market and into the sales market, said Jonathan Miller, CEO of Miller Samuel and author of the report.
"Leasing every year peaks in August, so we're looking at two more months of probably more leasing growth," he said. "That means more rent pressure, so my takeaway is that we're looking at higher rents this summer."
Elections around the world are set to have a profound, albeit temporary, impact on luxury housing, according to a new midyear Luxury Outlook report from Sotheby’s International Realty.
“We really wanted to take a temperature check on what potential the U.S. election might have on the market,” says Chief Marketing Officer Bradley Nelson, who spearheaded the report. “Globally, what we found when we spoke with colleagues, and did research in various parts of the world, is that there does seem to be a temporary dampening in transactional activity for a very short window immediately leading into an election.”
The report references elections ranging from the U.S. to the U.K. to South Africa to India and quotes Christie-Anne Weiss at TTR Sotheby’s International Realty in Washington, D.C., who says, “From my experience, what we see again and again is that our market gets quieter around October,” the month before Election Day. “Once the election is over and we know who the president is, business will resume as normal,” she continues. “It is buyer psychology — people do not make major investment decisions when there is imminent uncertainty.”
Elections won’t simply affect buyer behavior; they’re also anticipated to constrain supply. “You may decide this is a very noisy moment in time,” Nelson says, referring to a month leading up to an election. “So you might remain off-market” until elections are concluded, he says. “I think that’s a very common exercise.”
Interest-rate impact
But Nelson says elections are expected to be a sideshow compared with broader, global monetary policy. “The election is far, far, far overshadowed in terms of the performance of the housing market, by interest rates,” he says. “The interest-rate environment has stayed much higher for much longer. If you are looking for a cause and effect of what’s happening in housing right now, it’s really tied to high rates.”
The Sotheby’s report also quotes a broker in Dallas, who says that “if interest rates start falling, I think people will buy. If they stay elevated, people will remain on the sidelines.” The report goes on to cite luxury real estate transactions in Brazil, where rates have already begun to fall. It quotes the Brazilian broker Renata Victorino, who says “the most affluent buyers do not depend on credit, but for investors, the reduction in interest rates makes real estate a more interesting option.”
Given that “every single expert that we interviewed for the report is predicting that rates will not start with a ‘5’ until 2025,” Nelson says, there’s a chance that luxury transactions will remain comparatively subdued for the rest of the year. “Your home is not appreciating as quickly as it did if you had purchased it in February of 2020,” he says. “But the value has remained pretty stable.”
An ‘attractive time to buy’
This doesn’t mean there are deals to be found. As demand continues to outstrip supply, prices for luxury real estate around the world continue to remain firm, Nelson says.
It’s a phenomenon, he says, that can be attributed at least in part to “an older generational cohort that would have typically sold their home to downsize but are really choosing to age in place.”
This is the product of two factors: “They’re looking at the opportunities to downsize and seeing that it’s just as expensive as the larger home that they already have,” Nelson says. “And the second factor is they've accumulated so much wealth in their lifetime that they can really afford any in-home care that they might need and age in place for longer.”
Given that this generation isn’t going anywhere in the short to medium term, supply looks to be constrained for a while. But with falling interest rates set to bring more buyers back into the market, competition could spike precipitously for the few homes that are available. With that possibility on the horizon, “now is actually a pretty attractive time to buy,” Nelson says.
Archegos Capital Management founder Bill Hwang was found guilty of criminal charges stemming from his firm’s 2021 collapse, concluding a two-month trial that captivated Wall Street.
The jury delivered verdicts against Hwang and his co-defendant, former Archegos chief financial officer Patrick Halligan, Wednesday in Manhattan federal court. The panel began deliberating just the day before.
Both men were convicted of defrauding Archegos counterparties like Credit Suisse Group and UBS Group by lying to them about the firm’s trading activity and the level of risk in its portfolio. Hwang was separately found guilty of manipulating several stocks, including the former ViacomCBS, though he was acquitted with regard to one stock. Both men were also convicted of participating in racketeering conspiracy.
Each count carries a maximum sentence of 20 years in prison. U.S. District Judge Alvin Hellerstein set an Oct. 28 sentencing for both men. Hwang remains free on a $100 million bond secured by $5 million in cash and two properties. Halligan is free on a $1 million bond.
Hwang didn’t visibly react as the verdict was read, instead holding on to a plastic water bottle and staring straight ahead. Halligan clasped his hands on his lap and briefly glanced at the jury before looking down at the defense table.
After the verdict was delivered, Hwang got up and warmly greeted his wife and other supporters in the courtroom before exiting. His lawyers declined to comment. Hwang also declined to answer questions as he was leaving the courthouse.
One of the jurors, who asked to remain unnamed, said he was on the fence during most of the trial because he worked on Wall Street for more than three decades. But he said Hwang condemned himself because he was trading on such a large scale and it had a manipulative impact on stocks.
The juror said he felt some sympathy for Halligan, who he thought might have been dragged into Hwang’s scheme.
Manhattan U.S. Attorney Damian Williams said in a statement, “This verdict should send a resounding message that this office will continue to police the financial markets with an eagle eye and swiftly hold accountable those who think they can cheat the system.” Williams’ office brought the case against Hwang and Halligan.
According to prosecutors, Hwang’s actions pushed the value of Archegos, his family office, to around $36 billion at its height. But a March 2021 downturn in Viacom shares sparked a selloff that doomed the firm. Archegos’ counterparties lost some $10 billion, and the disaster was a major factor in Credit Suisse’s 2023 collapse.
Hwang and Halligan are likely to appeal their convictions. Edward Imperatore, a former federal prosecutor who followed the case, said there were viable arguments concerning the definition of market manipulation.
“It is a murky area of the law,” he said, though he added that he doubted the men would be able to overturn their convictions.
Wall Street victims
The scale of Archegos’ success and then its failure stunned the financial community in early 2021. The massive losses suffered by the banks raised serious questions about how they assessed the risks of taking on and extending credit to trading clients. At the time, neither Hwang nor Archegos was well-known on Wall Street, adding to the shock of what happened.
Manhattan federal prosecutors brought charges against Hwang and Halligan a year after Archegos’ collapse, after securing the cooperation of former Archegos head trader William Tomita and former risk head Scott Becker. Both men pleaded guilty and agreed to testify against their former bosses.
At the time, the Archegos case was the biggest white collar case brought by Williams’ office. Unlike in other big Wall Street prosecutions, however, the victims weren’t average investors but Wall Street itself — namely the banks that acted as Archegos’ prime brokers.
Hwang’s lawyers had said before trial that they planned to argue that the banks were sophisticated players that knew the risks of dealing with Archegos, a family office not required to publicly disclose its holdings, and went ahead anyway because of the fees they earned.
Star witnesses
But Hellerstein sharply restricted the defense’s ability to cast blame on the banks, sustaining objections when questions veered in that direction. At trial, the defense focused on trying to present Archegos’ trading as being part of a long-term strategy and tried to suggest that stock prices moved for other reasons than the firm’s alleged manipulation.
Tomita and Becker were indeed the star witnesses at the trial that began on May 13. Becker testified that he lied to banks to win access to credit and trading capacity for Archegos. He also gave jurors a picture of the frantic final days at Archegos as the firm continued lying to the banks to stave off margin calls.
Defense lawyers attacked Becker for having relatively little direct interaction with Hwang. That couldn’t be said about Tomita, though. The former trader worked closely with Hwang and offered damaging testimony about how his boss micromanaged his team to goose stocks to certain prices and also directed Tomita to lie to Archegos’ counterparties about the firm’s portfolio.
Tomita testified that Hwang instructed his traders to do “the opposite” of what a “normal fund” would. He noted that normal funds would try to build up their positions at the lowest cost and try to minimize the impact of their own trading on prices. At Archegos, Tomita said, “I could see that it was me that generated the stock price.”
‘Panic button’
The jury also heard from many Archegos counterparties. Former UBS risk manager Bryan Fairbanks was the first witness to take the stand in the trial, and he vividly described being on the other end of Archegos’ lies.
Fairbanks described being told that Archegos’ portfolio largely comprised highly liquid megacap tech stocks like Apple and Amazon, and that its trading in companies like Viacom and Chinese online education company GSX Techedu was unique to UBS. It was only at the very end that Fairbanks said he learned that Archegos was buying the same companies at all of its banks.
He said he “probably would have hit the panic button” if he had known how concentrated the firm’s positions were.
“All the information they shared with us was lies,” Fairbanks testified.
Hwang’s lawyers tried to suggest Fairbanks and other bank witnesses were biased because Archegos’ failure hurt their careers, but the judge sustained objections to those questions. The defense did manage to gets some digs in at the banks, though.
‘Rich or poor’
In cross-examining Goldman Sachs Group swaps sale specialist Nastassia Locasto, Hwang’s lawyers did establish that that bank viewed Archegos as a gap in its revenue stream and acted fast to onboard the family office as a client when it feared that a $2.8 billion portfolio — and $3 million in annual fees — would head to a rival.
The judge also barred the defense from some attacks on Tomita. Hwang’s lawyers had sought to undermine Tomita’s testimony that he spent the months after Archegos’ collapse wracked with pain and guilt over his actions.
“Do you recall you spent much of July 2021 in St. Tropez, France, playing polo?” Hwang lawyer Barry Berke asked him. Hellerstein sustained the prosecution’s objection before Tomita answered.
“Whether Mr. Tomita is rich or poor, whether he plays polo or baseball, whether he’s in St. Tropez or in Miami Beach, Florida, or New York City, is not relevant to this case,” the judge said. “You can examine his credibility, but you can’t examine his way of life.”
The defense instead focused heavily on normalizing Archegos’ trading as based on widely accepted principles. In opening statements, Berke highlighted Hwang’s devotion to the lessons of Philip A. Fisher’s classic 1950s investment text, "Common Stocks and Uncommon Profits," which has also been cited as an influence by Warren Buffett.
Maimonides Health received $17 million to establish new services for serious mental illness, including a new psychiatric emergency program and a youth inpatient facility.
The Borough Park-based health system announced three grants on Wednesday to ramp up behavioral crisis services – part of an effort to meet a dearth of care for adults and children with severe mental conditions in Brooklyn, said Dr. Abraham Taub, chair of psychiatry at Maimonides.
The state’s Office of Mental Health granted the health system $6 million to build a Comprehensive Psychiatric Emergency Program, a 24/7 program to serve as an entry point for individuals with severe mental conditions. The program allows psychiatrists to involuntarily keep patients with serious needs in their care for up to three days, and includes care such as addiction counseling and social worker support.
The program will operate out of Maimonides’ new psychiatric emergency room, which is in construction and expected to be complete by early next year, Taub said. The new psych ER will quadruple the square footage of the existing psych facility and accommodate between 12 to 15 patients, he added.
Maimonides also received $5 million from state mental health officials to build a 20-bed inpatient psychiatric unit for adolescents. The only Brooklyn hospital that has an inpatient unit for teens is the Kings County Hospital, part of the city’s public hospital system, Taub said, pointing to the lack of inpatient facilities for youth.
“We have kids who are being held up in emergency rooms… sometimes waiting a week or two for a transfer to an institution that has an adolescent inpatient unit,” Taub said. The health system is just beginning to devise construction plans for the new psych facility, and does not have an expected timeline for its completion.
In addition to state grants, Maimonides also received $6.7 million from health insurers Fidelis Care and Healthfirst to contribute to the new inpatient facility, as well as expand outpatient primary care and addiction services.
State funding for the emergency program and inpatient facility are a part of Gov. Kathy Hochul’s $1 billion mental health initiative. The state has distributed roughly $39 million to hospitals to open new Comprehensive Psychiatric Emergency Programs as well as $30 million to community hospitals to add more than 100 inpatient psych beds.
New York state has long spent the most in overtime on mental health, disability and corrections agencies. But even as overtime spending trends downward, watchdogs say the state should re-evaluate why human service agencies continue to rack up costs.
The Office of Mental Health, the Office of People with Developmental Disabilities and the Department of Corrections and Community Supervision accounted for 69% of the state’s total overtime hours and 66% of all pay last year, despite making up less than a quarter of the workforce, according to a report released by State Comptroller Thomas DiNapoli last month.
The state spent $1.2 billion on overtime in 2023, an 11% decline from the previous year. Overtime pay among the state’s top spenders has also come down; the state’s mental health and disability agencies saw a 27% decline in overtime in 2023, spending $177 million and $267 million, respectively.
Mental health, disabilities and corrections agencies have long clocked the most overtime. Human service sectors of the public workforce are likely to need more overtime compensation, because they are large agencies and staff state-run facilities like psychiatric hospitals, group homes and prisons 24/7. Yet, officials tasked with overseeing overtime spending have offered little insight into whether these costs are justified, watchdogs say.
“It's good that their overtime numbers are coming down, but lawmakers shouldn't rest on their laurels,” said Ken Girardin, director of policy and research at the fiscally conservative think tank Empire Center for Public Policy. “They should be drilling into how these agencies are functioning and looking at ways for them to do a better job.
State-run disability programs require direct support staff to work overtime if there is no other safe option because of staffing shortages, said Erin Silk, a spokeswoman for the Office for People with Developmental Disabilities. She added that the agency has taken "aggressive steps" to reduce overtime hours.
James Plastiras, a spokesman for the Office of Mental Health, also said that his agency “strives to be fiscally responsible and has controls in place to prevent unnecessary overtime.”
Many state-run psychiatric facilities have minimum staffing requirements to protect patients, Plastiras said, noting that overtime costs are driven by staffing rules, staff seniority and collective bargaining agreements with unionized employees.
But some overtime pay is questionable. Last year, four psychiatric nurses employed by the Office of Mental Health earned more than $300,000 each in overtime pay, in some cases raking in total compensation five times their total salary, according to data from the fiscally conservative Empire Center for Public Policy.
Huyphuc Pham, a psychiatric nurse supervisor at Bronx Psychiatric Center, for example, collected $350,000 in overtime, the Empire Center said. Pham’s base pay was $98,000 in 2023.
Plastiras did not respond to a question from Crain’s about the four nurses who made more than $300,000 in overtime.
Overtime pay “that's so high it doubles salary is a sign of crises and management failure — especially in a health care setting where extreme staff fatigue can lead to bad decision making that harms patients,” said John Kaehny, executive director of the government watchdog group Reinvent Albany.
“There’s clearly a problem when an agency whose overall OT is going down a great deal fields the individual OT champs,” Kaehny said.
Girardin said that overtime costs are just one measure indicating how state agencies function, noting that it doesn’t indicate how well workers do their jobs nor whether the state is meeting the needs of residents.
“Overtime is just one gauge on the dashboard,” Girardin said. “The legislature should be putting hundreds of gauges on every agency so that the public and their elected representatives can make better choices about how these agencies run.”
TB TREATMENTS: A research team co-led by Weill Cornell Medicine received a five-year, $31 million grant from the National Institutes of Health to develop new treatments for tuberculosis, the institution announced Wednesday. The federal government funded the Preclinical Design and Clinical Translation of TB Regimens consortium, a group of more than 30 investigators from 20 institutions to advance new tuberculosis treatments to clinical trials. The research consortium is co-led by the University of California in San Francisco, Johns Hopkins Medicine in Baltimore and Vanderbilt University Medical Center in Nashville.
DEMENTIA CARE: The federal Centers for Medicare and Medicaid Services selected Mount Sinai Health System to participate in a program to test a new payment model for dementia payments, Mount Sinai said yesterday. Under the new payment model Mount Sinai will offer education and training to dementia patients and their caregivers and offer caretakers respite services to try to delay the need for nursing home care. The Upper East Side-based health system is one of 400 participants testing the model, which launched on July 1.
PHHPC MEETING: The Public Health and Health Planning Council’s public health committee is scheduled to meet at 1 p.m. today at the Department of Health offices in New York City. Tune into the meeting here.
U.S. Rep. Alexandria Ocasio-Cortez filed articles of impeachment against Supreme Court Justices Clarence Thomas and Samuel Alito for what she said was their failure to report gifts and refusal to recuse from cases in which they were conflicted.
Given the Supreme Court’s refusal to deal with the issue itself, “Congress has a legal, moral, and democratic obligation to impeach,” the New York Democrat said in a press release on Wednesday.
Progressives and others have criticized both justices over reports they accepted vacations from wealthy people and failed to recuse from cases despite conflicts they said were created by their spouses.
The success of either resolution against arguably the court’s two most conservative justices is unlikely given Republican control of the House.
Conservatives have decried Supreme Court ethics concerns as a political ploy by the left to undo the 6-3 conservative majority that has overturned the constitutional right to abortion, undermined affirmative action and voting rights, strengthened gun rights, and weakened the power of federal regulatory agencies.
Mark Paoletta, a conservative lawyer and vocal Thomas defender, called the effort on X “Democratic lawfare against their adversaries.”
The Supreme Court didn’t immediately respond to a request for comment.
Samuel Chase was the lone justice to be impeached by the House, in 1804. He was acquitted by the Senate.
Letters, criticism
The move to impeach Alito and Thomas follows efforts by Ocasio-Cortez and other Democrats to rein in what they see as corruption on the Supreme Court, which polls show has been mired in historically low public approval ratings.
Ocasio-Cortez and Rep. Jamie Raskin of Maryland wrote to Chief Justice John Roberts on June 20 urging him to investigate Thomas and Alito. Democratic senators have sent similar requests to Roberts.
Ocasio-Cortez and Raskin also introduced a bill June 25 to prohibit justices from accepting gifts of more than $50. That proposal also is likely to go nowhere.
The Supreme Court has largely thrown cold water on pressure from Capitol Hill Democrats and others to force changes in how justices conduct themselves off the bench.
Critics say a code of conduct adopted by the justices in 2023 for the first time doesn’t go far enough to address ethics and other concerns.
“Given the court’s demonstrated inability to preserve its own legitimate conduct, it is incumbent upon Congress to contain the threat this poses to our democracy and the hundreds of millions of Americans harmed by the crisis of corruption unfurling within the court,” Ocasio-Cortez said in her statement.
Violations alleged
In her impeachment resolution that attracted more than half a dozen progressive cosponsors, Ocasio-Cortez revisited widely reported gaps over the years by Thomas in disclosures of trips, gifts, and other largesse.
Unreported gifts cited in the resolution include a 2019 trip to Indonesia, estimated to be valued at approximately $500,000, tuition payments for Thomas’ grandnephew amounting to more than $6,000 per month, and the 2014 sale of a family home costing $133,363.
The resolution also cites texts from Thomas’ wife, Ginni, in 2020 to then-White House Chief of Staff Mark Meadows about attempts to overturn the presidential election and her attendance at the “Stop the Steal” rally Jan. 6, 2021, ahead of the Capitol riot as reasons the justice should’ve recused from election-related cases.
In failing to do so, Thomas “flagrantly” violated ethics rules, the resolution said.
The resolution seeking to oust Alito also largely centers on the activities of his wife, Martha-Ann. Alito previously stated that she flew an upside-down American flag at their Northern Virginia residence in early 2021. Though the Alito’s claim the flag was flown in response to a neighborhood dispute, critics have noted its association with the “Stop the Steal” movement.
“Justice Alito has indicated sympathy with the efforts to overturn the 2020 election by allowing symbols of support for those efforts to be flown outside his residences,” the resolution said.
Alito declined to recuse from Jan. 6 related cases, including the court’s July 1 decision suggesting broad presidential immunity for former President Donald Trump.
Impeachment resolution cosponsors included Reps. Barbara Lee of California, Rashida Tlaib of Minnesota, Bonnie Watson Coleman of New Jersey, Delia Ramirez of Illinois, Maxwell Frost of Florida, Ilhan Omar of Minnesota, Jamaal Bowman of New York and Jasmine Crockett of Texas.
Beth Israel will not close on Friday after 10 months of saying that July 12 would be its final day in operation, according to an internal memo sent to staff.
The hospital has previously held firm on the original closure date, but two major challenges have foiled its plans for now: The state has yet to approve the closure plan, and a Manhattan judge has blocked the hospital from ceasing services after neighbors and advocates filed suit.
The hospital system did not give a new target closure date, saying that the situation now depends on state and legal forces.
Mount Sinai leadership expressed its concern in the memo sent to staff from Mount Sinai Health System CEO Dr. Brendan Carr and Beth Israel President Elisabeth Sellman and which was reviewed by Crain’s.
“There is urgency as there are risks associated with keeping the hospital open beyond the proposed date,” the memo reads, noting that the hospital has lost about 450 staff to other jobs.
Lack of state approval is one hurdle standing in Beth Israel’s way. The state Department of Health deemed Beth Israel’s original closure plan incomplete, forcing the system to submit a revised plan in May. The state has yet to reach a decision on the new plan, which included additional information on whether the surrounding community had sufficient opportunity to weigh in on the process and how Mount Sinai has coordinated with neighboring institutions like Bellevue and NYU Langone to address potential gaps in patient care.
A January investigation by the state Department of Health found that the hospital had prematurely ended hospital services without approval.
A lawsuit challenging the closure filed by a group of East Village residents, advocates and community leaders is the other major thorn in the health system’s side. The legal move led to a Manhattan judge blocking Mount Sinai Health System from transferring staff or reducing services at Beth Israel until arguments are presented in court.
The next court appearance will take place on Aug. 8.
This apartment is fit for a king.
The Canadian government has splurged on a luxe condo on Billionaires Row, records show, representing the complete sellout of the landmarked Steinway Hall building at 111 W. 57th St.
With "His Majesty the King in Right of Canada, Represented by the Minister of Foreign Affairs," listed as the buyer, the Great White North has acquired unit 11A, a three-bedroom, four and a half bathroom apartment on the eleventh floor of the Midtown complex, for $6.6 million — or $8.9 million in Canadian dollars — according to a deed that appeared in the city register Tuesday. The sale closed in June.
It's unclear who exactly will occupy the 3,601-square-foot pad with views of the city and access to a swimming pool and sauna — whether it's Tom Clark, the consul general of Canada in New York, or His Majesty King Charles III himself. Clark was named consul general in 2023, and Charles ascended to the throne of the constitutional monarchy of the United Kingdom, becoming also the sovereign of Canada, following Queen Elizabeth's death in September 2022, according to information on the government of Canada's website.
The Canadian consulate, which did not respond to a request for comment, is located at 466 Lexington Ave. and is a 25-minute walk or an eight-minute drive from the luxury condominium, which was developed by Miami-based real estate firm JDS Development. It's not unusual for the general consulates of foreign nations to live — and party — in lavish Manhattan apartments within close proximity to the United Nations, as Crain's has previously reported.
Robert McCubbing, whose LinkedIn says he is the senior trade commissioner and director of trade and investment at the consulate general of Canada in New York, signed the deed on behalf of His Majesty, records show, and developers Kevin Maloney and Michael Stern of JDS signed the deed on behalf of the seller.
The Billionaires Row complex features 60 total residences. Fourteen of them, including 11A, are in the landmarked Steinway Hall, which has now been completely sold, said Anna Crowley, a representative for the property, and the remaining 46 full-floor and duplex residences make up the adjacent 91-story tower, which has sweeping views of Central Park.
Crain's reported last year that Apollo Commercial Real Estate Finance, the lender with debt tied to the Midtown apartment, was wary about the slow pace at which units were selling. Crowley did not respond to a question about how many of the 46 units in the 91-story skyscraper have so far been sold but said that so far this year the entire West 57th Street complex has reported nearly $100 million in sales. Crowley also declined to answer questions about who will be living in unit 11A, which first went on the market in 2022 for $10.7 million, was listed again for $8.5 million a year later and then finally went into contract after a 16% price drop to $6.8 million in May, according to StreetEasy.
Leases
Nonprofit fundraising group expands in Times Square
Address: 1560 Broadway, Manhattan
Landlord: GFP Real Estate
Tenant: Broadway Cares/Equity Fights AIDS
Lease size: 3,200 square feet
Lease length: Five years
Asset type: Office
Brokers: GFP Real Estate's Alan Steinberg represented the landlord and tenant.
Sales
Sakhai family firm acquires Midtown high-rise
Address: 780 Third Ave., Manhattan
Seller: Nuveen Real Estate
Buyer: Sovereign Partners
Sale price: $177 million
Asset type: Office
Read more about the deal here.
3-story rental in West Village changes hands
Address: 244 Waverly Pl., Manhattan
Seller: Superior Management
Buyer: 244 Waverly LLC
Sale price: $14.5 million
Asset type: Multifamily
Financings
Harlem's tallest building, The Victoria, refinances
Address: 230 W. 126th St., Manhattan
Owner: Lam Group and Exact Capital
Lender: Aareal Capital
Loan amount: $148 million
Asset type: Multifamily
Brokers: Walker & Dunlop Capital Markets team led by Aaron Appel, Keith Kurland, Jonathan Schwartz, Adam Schwartz, Ari Hirt and William Herring represented the owner.
Big new apartment buildings may still be rare in the city. But a part of the Bronx not known for high-rise development just opened one.
The Bronx Vibe, a 12-story, 155-unit rental project, is welcoming tenants at 299 E. 161st St., a neighborhood known on some maps as Concourse Village but probably most familiar as the home to the borough’s courthouses.
Developed by Diamond Property Management, a Brooklyn-based firm headed by Moshe Halberstam, the project has a mix of market-rate and affordable units after qualifying for a 421-a property tax abatement. Although the 421-a incentive expired in June 2022, the Bronx Vibe broke ground in time to be eligible. (State lawmakers earlier this year passed a watered down replacement program, 485-x.)
The neighborhood, near Metro-North tracks, is familiar with below-market-rate residences. The Jackson Houses, a multi-building New York City Housing Authority complex, for instance, stands a few blocks to the south.
But new market-rate housing is unusual to see in the bustling area, which sits a few blocks east of Yankee Stadium. Those 108 studios to two-bedrooms, which have stainless-steel appliances, stone counters and porcelain tiles, start at $2,541 a month, or an initial rate of $2,052 when factoring in a bonus of two-and-a-half-months of free rent for a 13-month lease. Similarly, one-bedrooms start at $2,385 a month, when taking the concession into consideration.
Those units came to market in late May, and 37 had been leased as of July 10, according to Bohemia Realty Group, the site’s broker. Tenants began moving in over the last few weeks.
The Bronx Vibe’s 47 affordable units, which are reserved for those making 80% to 130% of the area median income, meanwhile, start at $1,718 for studios and $1,829 for one-bedrooms. Offering similar finishes to the other apartments, the units are being awarded through a lottery launched in May.
Designed by IMC Architecture, a firm whose previous credits include small rentals in Brooklyn and the Bronx, the building also offers a co-working space, a 12th-floor gym and, eventually, a movie-screen-equipped roof deck. A 52-space parking garage offers an EV charging station.
Located between Morris and Park avenues, the Bronx Vibe sits on what was formerly six different tax lots, most of which contained wood-frame houses. Diamond Property snapped up the combined parcel in 2019 for $2.1 million before obtaining $40 million in construction financing from Webster Bank for the project, according to the city register.
Though the building appears to have been conceived well before the multi-family development slump brought on by high interest rates and regulatory factors, it does seem to represent a bit of a counter-example.
Indeed, the fourth quarter of last year saw 16% fewer building permits filed than the historical average stretching back to the Great Recession year of 2008, according to the trade group the Real Estate Board of New York. And only nine projects of the group planned to have 100 or more units, according to the REBNY data, the most recent available.
Still, in April Dunn Development filed plans to construct an 11-story, 120-unit project in the Bronx’s West Farms neighborhood.
The president of real estate investment trust W.P. Carey, John Park, is stepping down after 37 years at the big commercial landlord.
No successor was named and his duties will be assumed by CEO Jason Fox effective September 30. Manhattan-based W.P. Carey owns 168 million square feet of commercial space across nearly 1,300 properties nationwide.
Park started as an investment analyst and spent his entire career at the firm before rising to president in 2018. He plans to serve as a senior adviser through February and remain trustee for the company that holds the office portfolio spun off by W.P. Carey last year.
“He was an internal guy, not the sort put in front of Wall Street, but very accomplished and it looks like a lot of his work was done,” said Evercore ISI analyst James Kammert.
Fox described Park as “an integral member” of the firm and thanked him for his role in shaping the publicly traded firm with a $12 billion market capitalization. W.P. Carey specializes in net-leased properties, which are those for which tenants pay not just rent but also taxes, utilities and other expenses. Net-leased properties often describe data centers and other critical infrastructure for banks or health care organizations.
Last year the landlord spun off more than 50 office buildings holding 8 million square feet into an entity called Net Lease Office Properties. The portfolio’s occupancy rate was 97% at the end of last year.
In recent years Park’s duties included repurchasing real-estate portfolios that W.P. Carey had marketed to outside investors. That task was completed in 2022, the company says.
The firm was founded in 1973 and traces its origins to when William Polk Carey leased small refrigerators to classmates at Princeton University, according to the company. In 2003, Arizona State University named its business school for Carey after a $50 donation. Carey’s grandfather introduced legislation in 1885 that led to the university's founding.
SUNY Downstate’s former head of emergency medicine embezzled nearly $1.5 million from the financially struggling hospital for personal travel, his kids’ school tuition payments and a luxury dog hotel, prosecutors allege.
Dr. Michael Lucchesi, 66, was charged for using SUNY’s company credit card for personal uses between 2016 and 2023, spending more than a million taxpayer dollars to fund a “lavish lifestyle,” Brooklyn District Attorney Eric Gonzalez and New York State Inspector General Lucy Lang announced Tuesday.
The Staten Island doctor allegedly spent $175,000 of the hospital’s money on doggy day care, prosecutors said. Roughly $120,000 of that sum went to the Green Leaf Pet Resort and Hotel in Millstone New Jersey, a luxury pet boarding and day care center.
The resort’s website boasts of low-impact cushioned floors, antimicrobial air filtration, no cages – only plush, all glass boarding suites and swimming lessons “since not all dogs are born knowing the doggie paddle.”
The former emergency room exec, who served at various points as the acting head of SUNY Downstate’s hospital and medical school as well as chief medical officer, earned a salary of $264,000 in 2023, public data shows. Lucchesi was removed from his position as emergency department chair immediately after the hospital discovered the suspicious payments, and he left his job three days later, according to a source familiar with the matter.
Lucchesi also racked up nearly $350,000 in recreational travel charges, more than $100,000 in payments to New York Sports Clubs for membership and personal training, and $46,000 in school tuition payments for his children, prosecutors said.
The former exec spent $52,000 on catering and made various purchases on flowers, liquor and electronics on the public hospital’s dime, according to the District Attorney’s office.
SUNY Downstate discovered suspicious payments during an internal review of hospital contracts, said Dawn S. Walker, a hospital spokeswoman. After detecting the activity, SUNY referred the matter to the inspector general’s office.
“New Yorkers deserve doctors who uphold their oath with the utmost integrity,” Inspector General Lang said. “The spending spree on the state’s dime alleged here is an insult to hardworking taxpayers and the medical profession.”
Lucchesi and his attorney did not immediately respond to requests for comment Wednesday.
Lucchesi was arraigned on nine counts in the Brooklyn Supreme Court on Tuesday, including charges of grand larceny and criminal tax fraud. Brooklyn Supreme Court Justice Donald Leo released Lucchesi without bail, and he is scheduled to return to court at the end of September.
The alleged theft marks another hit on SUNY Downstate, a financially ailing safety-net hospital that has long been targeted for closure by government officials. Gov. Kathy Hochul included a plan to close the hospital in her executive budget proposal in January; but the move was temporarily thwarted by local lawmakers and advocates as the state conducts a review of the hospital’s future.
The recently-amended New York LLC Transparency Act (“NY Act”) requires that all limited liability companies (LLCs) formed or registered to do business in New York State must make a filing with the New York Department of State (“DOS'') – a rule that is especially important to business entities navigating the requirements of the Federal Corporate Transparency Act (“Federal CTA”) and its reporting obligations. For real estate companies that frequently use LLCs to hold such real estate, understanding what measures can proactively be taken under the NY Act is key to maintaining compliance.
What is the New York LLC Transparency Act?
New York Governor Hochul initially signed the New York LLC Transparency Act on December 22, 2023, prompted in part to promote transparency and hinder money laundering in Manhattan’s high-end residential real estate market. This provided generally that entities’ beneficial owner information would be publicly accessible, with some minor exceptions.
The act was then subjected to a “chapter amendment” signed on March 1, 2024, the main reason being to amend the aforementioned requirement, with the effect that reported beneficial ownership information would remain confidential and reside on a secure database available only for certain stated reasons, including at the beneficial owner’s request or for law enforcement purposes.
What does this mean for businesses?
The law will go into effect on January 1, 2026, requiring that all LLCs formed or registered to do business in New York prior to January 1, 2026, will have one year to complete their required DOS filings. LLCs formed on or after January 1, 2026, will have 30 days from the date of formation or registration to complete their required DOS filings.
Required disclosure
Every New York LLC will be required to file with DOS in some form, and to recertify such filings annually. The specific information included in the DOS filing that each LLC conducts will depend on each LLC’s status as an exempt company, or a non-exempt company.
The act lists 23 exempt entity types outlined in the Federal CTA, specifying that any LLC considered exempt under the Federal CTA is also considered an exempt company under the New York act.
Exempt companies
Each exempt company must file an attestation, under penalty of perjury, stating the specific exemption claimed and “the facts on which such exemption is based.” This requirement differs from that of the federal CTA, which does not require any filings from exempt companies.
Non-exempt companies
LLCs that do not fall within one of the 23 exempt entity types must disclose the following information for each of their beneficial owners and applicants (as defined in the federal CTA):
- Full legal name
- Date of birth
- Current home or business street address, and
- Unique identifying number from one of the following: (a) an unexpired passport, (b) an unexpired state driver’s license, or (c) an unexpired identification card or document issued by a state or local government agency or tribal authority for the purpose of identification of that individual.
Proactive planning is essential for entities formed or registered to be a business in the United States in order to determine whether they qualify as an exempt company – and if so – which exemption(s) they fall within. Exempt companies formed or registered in New York will be required to substantiate their exemption by providing supporting facts, recertified annually.
In conclusion, business entities should monitor their exempt status to ensure that they continue to comply with the stated exemption(s) or otherwise be prepared to submit a filing disclosing their beneficial owner information at the federal and state level.
Joshua M. Alper is a partner in Sherin and Lodgen’s Real Estate Department and co-chair of the firm’s Environmental Law Group. Julia C. Royce is an associate in the firm’s Corporate Department.
The city wants to turn New York’s busiest trucking hub into a freight-focused electric vehicle charging site and workforce development center and make it easier for independent or reluctant industrial operations to embrace electric fleets.
A developer would lease, build and operate the new 3.2-acre space within the Bronx’s Hunts Point Food Distribution Center, the country’s largest such facility that distributes 4.5 billion pounds of food to more than 22 million customers annually, according to plans outlined by the city’s Economic Development Corp. In a request for proposal the city plans to announce later today, the EDC said it’s looking to “stimulate a broader sector transition to electric vehicles” to reduce the planet-warming pollution generated by the 15,000 truck trips that occur at the center each day.
At a sprawling 329 acres, the Hunts Point Food Distribution Center makes up nearly half of the Hunts Point peninsula. The campus is home to some 115 industrial food businesses, with more than 8,500 workers, including Anheuser-Busch, Baldor Specialty Foods, Citarella, Dairyland and Krasdale Foods, among many others.
Under the RFP a developer would be tasked with delivering an electric vehicle charging system capable of charging a range of vehicles. To start with, the site’s footprint should include 21 direct current fast chargers and eight slower, but more common Level 2 chargers, the RFP suggests. The idea is to encourage fleets to shift to electric models by reducing the need for existing tenants to make costly and time-intensive infrastructure upgrades at their leased locations.
Since financing for the new charging facility includes a $15 million grant from the Federal Highway Administration, the site must provide 24-hour, year-round public access to the chargers. Would-be developers must detail their proposed investments to the city.
Maria Torres-Springer, the city’s deputy mayor for housing, economic development and workforce, said the city aims for the model to be a boon for local businesses but also to the surrounding Hunts Point area, which she said has “disproportionately suffered” air quality and health hazards due to the fossil-fuel powered trucks.
The selected developer would also create a multi-purpose welcome center to serve as “a front door” to the food distribution center. Such a space could offer drivers and users of the electric charging hub amenities, such as bathrooms, food and drink options, outdoor green space and a prayer and meditation room, suggests the RFP.
Additionally, at least 5,000 square feet would be dedicated to workforce training with classroom space and a recruiting office. A flexible event space that could handle some 200 people could also be utilized for workforce and community-driven events, like job fairs, states the RFP.
Those interested in submitting a proposal to the city have until Nov. 21.
The pool at Hudson House, a luxury building in SoHo West, was scattered with people swimming, tanning and working on laptops against the scorching sun of a recent Thursday afternoon.
No, they’re not in Manhattan. It’s “South of Hoboken” in New Jersey — the latest audacious branding attempt by real estate agents who are pitching Jersey City as the “sixth borough of New York.”
It’s a hard sell for many New Yorkers who can’t shake the Jersey jokes, and some will always see relocating across the Hudson River as a step-down from the culture and buzz of Manhattan. But with a nearly 50% increase in new housing units completed from 2019 to 2023, the move-to-Jersey-City campaign has gained traction. Almost 30% of the area’s population arrived in 2021 or 2022, according to data from SmartAsset, a financial information provider.
And it isn’t just a popular move for the cash-strapped seeking more space. These days more New Yorkers are trading coveted city zip codes for high-end finishes, extensive amenities and New Jersey’s slightly cheaper cost of living.
“The people who are willing to consider moving to Jersey City now are wealthier,” said Padraic Gallagher, a broker for the Story Team at Compass. “It’s dual income households for the most part and people planning to have kids.”
Jersey City, which boasts an easy commute to Manhattan’s west side, has long been a place where New Yorkers find more affordable and larger housing options. And while it’s still cheaper than expensive parts of Manhattan and Brooklyn, a confluence of factors has driven up prices at some of the fastest rates in the country.
For one, rents and home prices in appealing New York City neighborhoods have surged. And since the outbreak of Covid-19 and the rise of remote working, there’s an even greater premium on space. That has white-collar workers in cramped apartments who don’t want the long commute that comes with moving to the suburbs gravitating to Jersey City.
Throw in the luxury housing boom and the median income in some neighborhoods is up 30% since 2019. For instance, half of all households in the Newport area, a hotspot for transplants on the Jersey City waterfront, earn more than $200,000 a year, according to 2022 data from SmartAsset.
Here to stay
James Sharpe lived in New York for almost 10 years before moving to Jersey City. Sharpe, who works in human resources for a pharmaceutical company, said he and his wife relocated from Bedford-Stuyvesant because they wanted more space but weren’t ready for suburban life.
Last year, they bought a three-story townhouse in downtown Jersey City, which was cheaper than the three-bedroom properties they were looking to purchase in Brooklyn.
Sharpe, who has two young children, has had no trouble adapting to his new neighborhood. He joined a Jersey City fathers’ WhatsApp group, has made friends through his gym and sees himself staying long term.
“You kind of get the best of both worlds and you don’t need to be full suburbs. I can still drive to Target or Costco or whatever I’ve gotta do for family stuff,” Sharpe said. “But you get the best of the city as well. I can be in Manhattan within about 15 minutes of leaving my front door.”
Sharpe still tells friends back home in Manchester, England, he lives in New York though.
A New Jersey city
As Jersey City’s residents get richer, the city’s offerings are going upscale. The downtown area got its first Whole Foods last year, and trendy New York eateries including Daily Provisions and Tacombi are slated to open locations.
The real estate is increasingly expensive too. Last month, a four-bed, four-and-a-half bath penthouse with skyline views on the waterfront listed for almost $7 million. Anything similar would probably go for more than $15 million in New York, said Diana Sutherlin, a broker at Compass.
“New York City has always been a magnet for brainpower, capital and creme de la creme real estate,” said Christian Caropolo, a real estate agent for Douglas Elliman. “You can get all that in Jersey City now too.”
Jersey City development projects can take three years to complete compared to as long as 10 in New York, which makes it an attractive opportunity, Caropolo said. Financing can be hard to come by these days. But new high-rise towers such as Hudson House are boasting 98% occupancy rates. As such, Related Cos., best known as the developer behind Hudson Yards, closed a $58 million deal last October for a lot in downtown Jersey City to develop a high-rise residential property with as many as 800 units.
“With the trend on demographics of people moving to Jersey City showing an increase in income, it bolstered our case to build new luxury residences there,” said Related President Bruce A. Beal Jr.
Begrudging pride
For long-time residents, the change is palpable. Bill Gray moved to Jersey City in the ‘90s when he bought two combined four-story buildings in Paulus Hook. He lives in the top unit, where he raised his three children, and on the ground floor is the Light Horse Tavern, a restaurant he converted from what used to be a blue-collar pub called Bella’s Bar. The project likely wouldn’t be possible today because of how expensive property is, Gray said.
“I support the development, but at the same time, I like having my neighbors be around me for a long time,” he said. “I don’t like to see people get squeezed out.”
Meanwhile, Audrey Rose Arnold, a 28-year-old actor and filmmaker who moved from Queens to Jersey City in April, said she’s getting to know her neighbors, which is something she never did in her five years in the Big Apple.
She admits she had a bit of “New York snobbery” about New Jersey. But soaring housing costs made her reconsider. And with more space and views of Liberty State Park, she now says the stigma around moving to Jersey is “so absurd.”
“I think it’s better living here than deep in Brooklyn,” she said. “There’s more bang for your buck and I don’t feel like I’m missing out.”
The dog days of summer conjure daydreams of ice cream, picnics, barbecues … and heaping plates of hearty pasta?
“I used to think I needed to make the pastas lighter in summer,” says Andrew Carmellini, who serves notable noodles at Locanda Verde, Café Carmellini and Bar Primi. But in the hottest months, he says, “we’d still sell so much carbonara and Bolognese, customers freaked out when I tried to change it.”
Now he makes them year-round.
New York is a pasta town, after all, dating to the mass arrival of Italian immigrants in the 1800s. And as with other city staples, namely pizza, bagels and burgers, there are a lot of strong opinions about them. Especially where to find the best.
So we polled a few experts — the country’s top chefs — to tell us what they love. Alongside cult favorites like Don Angie, there are newer options such as Torrisi, where co-owner Rich Torrisi serves cavatelli with an allspice- and chile-packed ragu inspired by the Jamaican beef patty snacks he used to get from food trucks outside his school. At Raf’s nearby, chef Mary Attea channels southern Italy for spaghetti heaped with bottarga, the intense, salty dried tuna roe. At Daphne’s in Bedford-Stuyvesant, chef Jamie Tao makes his ragu with fatty, luscious beef cheek that wedges itself in the nooks of spiral gemelli.
Here are some highlights to enjoy this summer—and spring, fall and winter.
Veal tortellini with amaretto
Foul Witch, East Village
Carlo Mirarchi has established cult followings for his Bushwick pizza destination Roberta’s and for Blanca, the fine dining counter next door. Mirarchi’s latest is the brick-walled, Italian-accented Foul Witch in Manhattan. A must-order on the rotating pasta menu is a subtly sweet, grandma-inspired stuffed pasta in brodo. Light and aromatic, “the broth is highly addictive,” says Wildair alum Quang Nguyen. “I could probably eat three portions back-to-back-to-back.”
— Recommended by Quang Nguyen, chef of Demo
Pici all’arrabbiata
Lodi, Midtown
Amid the throngs of tourists packing Rockefeller Center, this stylish aperitivo bar is a peaceful oasis with an all-day menu from chef Ignacio Mattos. The plump, piquant tomato-sauced pici is tossed with chunks of salty guanciale (cured pork jowl) and is the obsession of Kwame Onwuachi, who was recognized by the James Beard Foundation as a Rising Star Chef in 2019. “I have been craving it every day since the moment I had it,” he says. “It’s so simplistic and incredibly nuanced at the same time. Layered with flavor from the guanciale, tomato and chiles, it perfectly complements the thick pasta.”
— Recommended by Kwame Onwuachi, chef-owner of Tatiana by Kwame Onwuachi
Rigatoni carbonara
Bar Primi, East Village
Occupying a corner on the rowdy Bowery is the two-story Bar Primi, where outdoor tables get packed in warm weather. Carmellini’s menu is a crowd-pleasing roundup of Italian antipasti and secondi favorites, but for Mitsunobu Nagae, owner and executive chef of L’Abeille, there’s only one order: rigatoni carbonara with guanciale, pecorino and egg yolk. “It’s a classic for a reason! Just a few ingredients, and done right, it’s the perfect blend of flavors,” Nagae says. “I’ve yet to taste a better carbonara in the city.”
—Recommended by Mitsunobu Nagae, chef-partner of L’Abeille and L’Abeille à Côté
Tagliatelle with parmigiano and prosciutto
Via Carota, West Village
The wait to get into this expertly rustic, no-reservations dining spot infamously takes hours. Few are deterred, including Louis Lin when he’s in town from Portland, Oregon. He shouts out one of the best-known dishes, the tangle of silky, ruffle-edged tagliatelle, topped with slices of prosciutto and a handful of grated cheese. “It’s exactly what you expect from them: simplicity, intentionality, execution and crave-ability. And most of the time, that’s all I want out of a bowl of pasta,” says Lin.
— Recommended by Louis Lin, chef-co-owner of Xiao Ye in Portland, Oregon
Spaghetti nero
Bacaro, Lower East Side
Bacaro has been operating on Division Street since 2007, before the area became a nightlife hotspot. Alex Raij is a longtime fan of the restaurant’s inky black spaghetti nero. “It’s not overdressed, and the actual pasta is somewhere between a chitarra and linguine,” observes Raij of the noodles’ distinct bite. And unlike every other version of the dish, it features squid ink in the potent cuttlefish-tomato-cream sauce, rather than in the pasta, so its briny flavor is more pervasive. “It’s very consistent and a little spicy and light on its feet.”
— Recommended by Alex Raij, chef-owner of Txikito and La Vara in New York
Shell pasta with ramp sausage
Rucola, Boerum Hill
This dining room on a picturesque, residential Brooklyn block is what Alinea and Per Se alum Greg Baxtrom calls “the perfect neighborhood restaurant.” His current favorite dish? “A delicious shell pasta with ramp sausage, English peas and pecorino cream.” The house-made shells are a staple on the short pasta menu; the sausage changes seasonally. One more thing to know about Rucola, says Baxtrom: “It’s also great for celebrity spotting. Every time I go in there, there’s someone famous.”
— Recommended by Greg Baxtrom, executive chef-owner of Olmsted, Patti Ann’s and 5 Acres
Lasagna pinwheels
Don Angie, West Village
Since it opened in 2017, Don Angie has become a prime destination for gorgeous, playful pastas. Exhibit A is chef-owners Scott Tacinelli and Angie Rito’s three-meat pinwheel lasagna, served in thick slices to show off the rolled layers. “I’ve never tasted anything like the lasagna at Don Angie,” says Max Wittawat of the buzzy Bangkok Supper Club. “Lasagna tends to be too heavy, but their use of homemade pasta makes the dish feel lighter, more enjoyable — and the whipped ricotta is creamier but not too dense.” The secret in the ragu? Thai fish sauce. “I’m obsessed,” says Wittawat. It’s also the favorite of Aquavit’s Emma Bengtsson, who labels it “a must-have pasta in New York. I love the crispy bits on the outside and the creamy inside.”
—Recommended by Max Wittawat, executive chef of Bangkok Supper Club, and Emma Bengtsson, executive chef of Aquavit
Buffalo milk caramelle
Don Angie, West Village
Simone Tong of Zoé Tong in Austin says her favorite New York pasta right now is Don Angie’s candy-styled buffalo milk caramelle that, with its twisted ends, conjures a wrapped confection. It’s filled with creamy ricotta and strewn in a sweet-sharp citrus sauce. The two-tone look comes from ribbons of black sesame pasta. “Black sesame, candied kumquat — all my favorite flavor profiles,” Tong raves. “And the shape makes my inner child smile so big!”
—Recommended by Simone Tong, executive chef of Zoé Tong in Austin
Uovo raviolo di Nino Bergese and Grandma Walking Through the Forest in Emilia
Rezdôra, Flatiron District
To get to Stefano Secchi’s terrific little restaurant, walk down an unremarkable Flatiron side street and descend a few steps into a sliver of a space where his artful pastas have captivated notable New York cooks. Le Bernardin’s Eric Ripert declares the uovo raviolo di Nino Bergese — in which one giant round is stuffed with herbed ricotta and an egg yolk that flows all over just as its dome is cut — his favorite. “It’s very original, difficult to execute, but most importantly, delicious.”
Salil Mahta has a different idea about the best order. He favors the brilliant, green-colored, spinach-flavored cappelletti stuffed with sweet roasted leeks and given a fanciful name: Grandma Walking Through the Forest in Emilia. “For me to crave a vegetarian pasta dish, that in itself is phenomenal.”
— Recommended by Eric Ripert, chef-co-owner of Le Bernardin, and Salil Mehta, founder-chef of Fungi Hospitality Group, whose seven restaurants include Laut and Singapura
Cavatelli With Jamaican beef ragu
Torrisi, SoHo
Like its sister restaurant Carbone, Torrisi is a perennially packed power dining spot. But the superb menu extends beyond an Italian-American highlight reel to include oversized, shell-shaped cavatelli in a meaty sauce punctuated with sweet and hot Caribbean flavors. Among its fans is Jean-Georges Vongerichten, whose restaurant empire includes the Tin Building food hall and the ABC Kitchens . “It’s the most pleasantly surprising dish, packing spice and punch, and it’s also comforting just as pasta should be,” he says. “It’s become one of my favorite restaurants. I go back time and time again just for this pasta.”
— Recommended by Jean-Georges Vongerichten, whose five dozen restaurants include his flagship Jean-Georges in New York
Spaghetti pomodoro
Sistina, Upper East Side
Sistina has been an elegant uptown dining staple since chef-owner Guiseppe Bruno opened it 40 years ago. “It’s a really special place that feels truly Italian,” notes Daniel Humm. “They make the most incredible spaghetti pomodoro.” Seductive in its simplicity, the dish has been served since Day 1 and is a consistent bestseller. A blend of tomatoes that adds varying degrees of sweetness is quickly cooked with a little garlic and onion, and a generous amount of olive oil, then tossed with the spaghetti for a creamy, sunny finale.
— Recommended by Daniel Humm, chef-owner of Eleven Madison Park
Gemelli with beef cheek ragu
Daphne’s, Bedford-Stuyvesant
This recently opened hot spot updates the city’s ubiquitous red sauce classics with options such as grilled pork collar with garlic chives, as well as green tomato vodka sauce-topped salsify. The effect is cozy and fun and “really delicious,” says Erik Ramirez of Llama Inn. He highlights Jamie Tao’s gemelli with beef cheek ragu because “it was the right amount of rich and hearty and gave off Bolognese vibes. I also liked that it didn’t have a lot of butter in it.”
— Recommended by Erik Ramirez, chef-owner of Llama Inn
Spaghetti
Four Twenty Five, Midtown
The newest big-deal restaurant in Midtown is the Norman Foster-designed Jean-Georges Vongerichten restaurant Four Twenty Five, named for its Park Avenue address. There are 45-foot-high ceilings and well-spaced tables and a simply named spaghetti from Jonathan Benno that makes the most of few ingredients — especially one with a strong umami hit. “It’s sublime: creamy sea urchin atop a nest of spaghetti tossed in garlic, lemon, olive oil and spicy pepperoncini,” says Grayson Altenberg. “It’s beautiful, because of the simplicity of the ingredients, and it showcases the urchin during its peak season.”
— Recommended by Grayson Altenberg, executive chef at the Ivory Peacock
Rigatoni with wild ramp pesto, asparagus, favas and pecorino
Aita, Clinton Hill
This fun neighborhood restaurant has a light-filled dining room, an inviting covered patio and plenty of aperitivo action. For chef Shenarri Freeman, who oversees the kitchens of plant-based restaurants on the East and West coasts, a selling point is that the dish she recommends is based on what’s best at the market. “I like their spin on the pesto pasta. It’s always seasonal and vegetable-forward,” she explains. Given a menu that highlights produce from farmers markets, in spring that means chunks of asparagus and shelled favas tossed in with the noodles and oniony ramp pesto.
— Recommended by Shenarri Freeman, chef of Cadence in New York and Ubuntu in Los Angeles
Spaghetti with tuna bottarga and calabrian chilies
Raf's, NoHo
“The spaghetti with tuna bottarga is my idea of perfection on a plate,” says Amanda Cohen, chef-owner of Dirt Candy. The Sicilian-inspired dish comes from Mary Attea, who with her partners has transformed the original Parisi Bakery space, where the brick ovens produced delectable Italian loaves, into a cozy hangout with a long Mediterranean menu. Here, the salted dried roe melts into the pasta strands and imbues them with the taste of the sea.
— Recommended by Amanda Cohen, chef-owner of Dirt Candy
Cacio e pepe
Roscioli, SoHo
Two hundred years ago, Roscioli in Rome got its start; since then, it’s been selling top-quality Italian grocery staples and turning out the Italian capital’s best-known dishes. The year-old New York outpost, set on a hidden corner in SoHo, doesn’t disappoint on the classics. “The cacio e pepe is simple, but the flavor is fantastic. It’s served with good-quality cheese, and the pasta is perfectly boiled,” says Hiroki Odo of Italy’s famed dish (that’s increasingly everywhere). It’s made here with sharp, nutty pecorino and a house peppercorn blend.
— Recommended by Hiroki Odo, chef-founder of Odo, HALL and the Gallery
Tagliolini with white venison ragu
Terre, Park Slope
At this Park Slope storefront restaurant, there’s plenty of charcuterie and cheese to pair with more than 100 natural wines by the glass. But Jay Kumar raves about a different combination: ribbony tagliolini dressed with a gamy ragu and garnished with crunchy nuts. “It’s a creamy white sauce infused with the rich flavors of venison, the subtle nuttiness of almonds and the fragrance of rosemary,” he says. “The combination is absolutely amazing.”
—Recommended by Jay Kumar, chef of Lore
PFIZER SHAKEUP: Pfizer’s chief scientific officer Mikael Dolsten is planning to step down as the company continues to redefine its growth strategy after its pandemic boon has fizzled, Pfizer announced Tuesday. During his 15-year stint at the pharmaceutical company, Dolsten oversaw 35 drug approvals, including for the Covid-19 vaccine Comirnaty and antiviral medication Paxlovid. Pfizer plans to initiate an external search for its new chief scientist and expects the search to extend through next year.
CYBERATTACK RESOURCES: New Yorkers who experienced privacy violations because of the Change Healthcare cyberattack are eligible for free credit monitoring and identity theft protections, New York state Attorney General Letitia James said in an alert yesterday. Change Healthcare, an electronic medical billing system based in Nashville, Tenn., is providing resources to affected patients for up to two years after the February cyberattack that shut down payment processing and compromised millions of patient records. Change Healthcare is a subsidiary of UnitedHealth.
RESEARCH GRANT: NYU’s Rory Meyers College of Nursing has received a $5 million federal grant to train health care professionals to provide age-friendly care to older New Yorkers in the Bronx, the institution announced Tuesday. The nursing school will partner with Montefiore Health System and Midtown-based aging services nonprofit JASA to train 5,000 health care workers and create a geriatric specialty certification for nursing assistants. NYU received the grant from the Health Resources and Services Administration.
A popular program that lets people choose and train their own caregivers has grown at an astonishing rate, blowing a multi-billion dollar hole in the state budget and leaving officials, including Gov. Kathy Hochul, with a big dilemma.
Spending on the Consumer Directed Personal Assistance Program, or CDPAP, has mushroomed by 4,055% since 2014, when it cost the state just $219 million, according to data from the federal Centers for Medicare & Medicaid Services. Spending reached $9.1 billion in 2023.
The growth stems in part from a 2015 relaxation of rules for who qualifies for the program that opened the floodgates and made it more vulnerable to fraud. There are now nearly 300,000 people working in New York’s home health care services sector, according to data from the state Department of Labor. That’s a 173% increase from 2014, when there was an average of about 109,000 workers, a boom fueled mostly by the low-paying, government-funded jobs provided by the program.
The largesse has also fueled a cottage industry of as many as 700 middlemen companies that facilitate the program in exchange for a cut of the caregiver’s earnings.
Now, Hochul’s administration is trying to stanch spending. In the coming months, the state will move to reduce the number of middlemen companies to a single contractor. Hochul has said the change will “allow us to start putting controls and guardrails in place for what has historically been a very underregulated program.”
“That’s how we ensure that the people who really need it get the best quality care while limiting the waste, fraud and abuse,” she said.
However, it’s unclear how pending changes will affect the 250,000 New Yorkers who have grown to rely on the program for care. The program began as a way to empower individuals with chronic health conditions and disabilities to have control over their care and avoid institutionalization.
“It kind of flew under the radar for a while,” said Bill Hammond, senior policy fellow at conservative think tank The Empire Center. “Until the dollars started piling up.”
Newfound freedom
There’s no question that there are success stories for the program. Jose Hernandez was 15 when he dove into the water at City Island in the Bronx. It was much shallower than he thought, and he broke his neck. As a result, Hernandez, now 44, has lived most of his life as a quadriplegic, unable to use his arms or legs.
Hernandez would not be able to care for himself or his child without a rotating staff of about five “personal assistants” — home care workers he finds and trains himself. Each day, one helps him with his bowel and bladder routine, then with getting dressed and into his chair.
The aides' help is made possible through CDPAP. Hernandez discovered the program nearly two decades ago, after years of going through traditional home health agencies, which sent him an array of “random” people, he said, many of whom struggled to handle such a difficult case. The constant change in caretakers prohibited Hernandez from establishing a routine; he would have to bring each new worker up to speed on his many needs. Sometimes it would take two-and-a-half hours to get ready in the morning.
“It was just constantly a new person every day,” Hernandez said. “That’s exhausting.”
The program is set up so that Hernandez can be a greater master of his own destiny, a luxury he rarely gets to enjoy. He can choose and train personal assistants to care for him how he wants and needs. The Medicaid-funded program intends to allow those in need of care, such as individuals with disabilities or the elderly, to employ home health workers of their choosing. Created in 1995, the program took off in 2015 when New York relaxed its rules to include most family members as potential paid caregivers.
“It gave me a level of freedom that I never experienced before,” he said.
Popular to a fault
People like Hernandez can employ almost anyone except a spouse. A parent caring for a child under the age of 21 also would not qualify under New York’s rules.
There’s no formal training required, and caregivers are generally compensated less than a trained home health aide. Personal assistants in the city make $18.55 per hour, and outside of the city they make $17.55. If they have another job, they aren’t required to give it up, and they are eligible for overtime, paid time off and benefits.
Supporters say it’s an attractive arrangement that grants agency to vulnerable people while compensating the mostly female caregiving workforce.
New York’s aging population is one reason for CDPAP’s explosive growth, but policy changes are a more important contributor, according to a research report by Step Two Policy, a think tank founded by Paul Francis, former deputy secretary for health and human services under Gov. Andrew Cuomo.
The posters plastered on subway cars speak to a relaxation of rules that began in 2015. A typical ad reads, “We are hiring caregivers! Flexible hours, great benefits, PTO, holiday pay & more,” with some even touting sign-on bonuses.
That year, state officials expanded the universe of people who could receive personal care services, as well as those who could provide services under the program. The looser rules, combined with a 2017 “wage parity” provision — an hourly rate set at $4.07 above minimum wage in the city — were the two primary factors accelerating the growth of the program, according to a report by Step Two Policy.
The growth is by far the largest of any employment sector, according to James Parrott, director of economic and fiscal policies at The New School. He said the average annual wage is about $38,000.
“It really has been an independent force on its own,” he said.
The workforce, which reached 299,000 in May, outnumbers retail clerks and fast food workers combined, according to Hammond.
Costly and murky
Critics say the program’s spending is out of control, and that the industry supporting the program has been allowed to proliferate unchecked and with minimal oversight.
A 2018 federal audit from the Department of Health and Human Services found that New York billed Medicaid nearly $75 million in fraudulent CDPAP claims from 2012 to 2016.
“New York’s lack of effective monitoring of the CDPAP leaves the program vulnerable to misuse of Federal funds and could potentially place beneficiaries at risk of harm,” the audit reads, noting that it was conducted because previous reviews identified personal care services in New York as vulnerable to abuse.
The audit pinned much of the blame on the middlemen companies, which manage payroll and help participants navigate the program; in exchange, they receive a share of the funding, according to Bryan O’Malley, the executive director of the Consumer Directed Personal Assistance Association of New York State, an industry group that supports the program.
As the program has swelled, the number of middlemen companies have also grown across the state to meet demand. There were just 68 such companies in 2013, according to O’Malley.
Now, they are a target of regulators.
The state estimates there are as many as 700 companies managing the administration of the program. Late in this year’s budget process, in an effort to save money and increase transparency, the governor proposed streamlining the administration to just one company. The move is expected to save $200 million in the first year and $500 million after.
Last month, the state released a request for proposals for a sole company to administer the program, and the race is on. Public Partnerships, a firm that operates in more than a dozen states and is expected to compete for the contract, recently inked a $6,500 monthly contract with lobbying firm Cozen O’Connor for “strategic advice and business development,” according to state records.
Maximus, a Reston, Virginia-based health care company that focuses on government services and brings in more than $4 billion in revenue annually, is another organization potentially in the running for the contract. It operates in 13 states.
There’s a case to be made for reducing CDPAP, said Hammond of The Empire Center.
“Where do you draw the line? There’s a lot of unpaid caregiving going on,” he said. “But traditionally we don't think of all interactions between family members as labor. We don’t pay parents for raising their children. There are an awful lot of families down through the ages who have taken care of their elderly relatives without expecting to get any money for it. So if we redefine all that activity, it’s going to get very expensive.”
Streamlining in Massachusetts
Massachusetts underwent a similar shift with its Personal Care Assistant program in 2022. The program is much smaller than New York’s, with a workforce of about 55,000 people serving 40,000 residents.
The program began in 1988 and has grown but not as quickly; eligibility remained limited to the disabled community. Massachusetts reduced the number of middlemen companies as a cost-cutting measure, but on a much smaller scale: The Bay State had just three providers compared to the hundreds in New York.
Chaos ensued as payments were delayed for thousands of caregivers due to administrative snags. In the days immediately following the switch, the state’s selected single organization, Tempus Health, wrote on its Facebook page that it had received 32,000 phone calls, according to The Boston Globe.
About 10% of workers missed payments when the change was enacted, which led to workers leaving, according to O’Malley. In New York, that would equate to about 25,000 consumers and 35,000 workers.
“That is an immediate health care crisis that is entirely avoidable because we have a system that works today,” he said.
Massachusetts Gov. Maura Healey’s budget proposal targeted the program again this year as a way to close a $950 million gap in MassHealth, the state’s version of Medicaid. The proposal says that only those who receive more than 10 hours of care per week would be eligible for the program.
In New York, applications to become the sole administrator for CDPAP are due by the beginning of August, and the contract is set to start on October 1st.
Hernandez is wary of the change. “I made a life for myself and I’m trying to make a life for my family,” he said. “Now I’m just scared.”
He may have missed out on acquiring Paramount. But Edgar Bronfman Jr.—media investor and billionaire heir to the Seagram liquor fortune—is still moving forward with one deal: an effort to unload his Park Avenue apartment.
Bronfman and his wife, Clarissa, a jewelry designer, have listed their triplex co-op at 812 Park Ave., No. PHA, for $22 million, according to a post that appeared last week, a few days before the movie studio Skydance snapped up the media conglomerate Paramount.
The five-bedroom spread at East 74th Street features six full and two half-baths, a primary suite that opens to a terrace and a living room with a fireplace, though the firm marketing the property, Corcoran Group, did not include a floor plan with the listing that might provide further details.
In 2011 the Bronfmans bought the unit, which sits atop a 14-story prewar building, for $15.9 million, according to the city register, and so could realize a decent profit, assuming Manhattan’s residential market continues to mend.
Still, among the four other units that are currently for sale at 812 Park is No. PHB, the building’s other triplex penthouse. That three-bedroom version also tried for $22 million when it came to market in January 2022, though its final price before going into contract last month was $16 million, according to its listing history on StreetEasy.
The co-op, which counts money managers and real estate executives in its ranks, was also once the home of Walter Noel, an associate of disgraced financier Bernie Madoff who ran a “feeder fund” that apparently channeled $7 billion to the Ponzi schemer, generating more than $1 billion in fees for himself, though Noel later claimed that he too was a victim of the scam.
Noel, who was never charged with any crime, sold his two-bedroom unit in the building, No. 2B, in 2022 for $2.4 million and died in April at 93.
Currently serving as the executive chairman of FuboTV, Bronfman emerged as a suitor in recent months for National Amusements, the parent company of Paramount, whose TV portfolio includes MTV, CBS and Nickelodeon. Barry Diller’s IAC was another contender.
But on July 7 Skydance, the upstart studio behind the smash Top Gun: Maverick backed by money from the software giant Oracle, announced it would buy out Shari Redstone’s majority stake in National Amusements. The move would allow it to control Paramount, with Oracle co-founder Larry Ellison kicking $6 billion into the deal, though regulators still need to sign off on it.
Bronfman is also chairman of the investment firm Waverley Capital, whose portfolio includes media startups such as Roku and sports website The Athletic. Previously, Bronfman served as CEO of the Warner Music label.
The Bronfman family, meanwhile, has controlled Seagram, a Canadian company, since the 1920s. Originally known for spirits such as Crown Royal, it later branched out into investments in entertainment companies, including Universal Studios, though by 2000, Seagram, racked by in-fighting, had sold off all of its entities to Diageo and other companies and closed down.
Through a spokeswoman, Leighton Candler, the Corcoran broker handling the Bronfmans’ listing, said she had no comment.
A penthouse at Aman New York has sold for $135 million, making it the most expensive home purchased in Manhattan this year.
The five-story apartment atop the historic Crown Building on Fifth Avenue was sold as unfinished space that the buyer is responsible for building out, a spokesperson for developer OKO Group said. The deal for the roughly 12,500-square-foot unit works out to more than $10,000 a square foot.
The transaction tops the $115 million purchase in June of an apartment at the nearby Central Park Tower. It’s also Manhattan’s priciest sale since January 2022, when an entity linked to Alibaba Group Holding Ltd. co-founders Joe Tsai and Jack Ma closed on a $188 million unit at 220 Central Park South.
The pair of recent nine-figure deals suggest that even as the median price of apartments sold in Manhattan has fallen from record highs, some super-wealthy buyers still have an appetite for lavish homes.
OKO Group’s in-house residential brokerage team handled the penthouse sale, which closed late last week. A spokesperson for the project declined to disclose the buyer’s identity or to provide photos of the unit.
The development firm — founded by Aman’s chief executive officer, Vlad Doronin — completed the conversion of the former office building at the corner of Fifth Avenue and 57th Street in 2022. In addition to its 22 condos, the project has more than 80 hotel rooms, a spa, fitness center, restaurants and other amenities to which homebuyers have access.
President Joe Biden has slowed — for now — public defections from House Democrats even as the party remains deeply divided on whether he should remain their White House nominee following a disastrous debate performance.
House Democrats argued behind closed doors early Tuesday about Biden’s ability to beat Donald Trump in November, one in a series of meetings this week that will determine Biden’s political future. There was no sign yet of the kind of clear consensus that might force him to reconsider his candidacy.
It’s a pivotal week for the embattled president, who is hosting a NATO summit in Washington. He will hold a Thursday press conference, offering critics and supporters another moment to study every word for signs he’s slipping.
“He shouldn’t endanger his legacy and deliver us to a tyrant,” Lloyd Doggett of Texas, the first Democrat to call for Biden to step aside, said following the House Democrats’ meeting.
Many lawmakers expressed support for Biden, albeit some more begrudging than others. And very few expressed confidence that Biden can win a second term.
New York Democrat Jerrold Nadler, one of several senior Democrats who have privately said Biden should step aside, said the president has “made very clear he is running” and the party must get behind him.
“He is the person,” Nadler said when asked if Biden can beat Donald Trump in November. “The president has determined that he is the best candidate.”
The president, who spoke late Monday with members of the Congressional Black Caucus and plans to meet with progressives later this week, did not speak to House Democrats directly.
Richard Neal of Massachusetts called the meeting a listening session and was among several Democrats who touted Biden’s accomplishments.
“It’s unbelievable what we have done over the last three years,” he said.
Not everyone has been swayed, however. Mike Quigley of Illinois, one of the Democrats who has publicly called on Biden to end his campaign, reiterated that Biden shouldn’t stay in the race.
Senate Democrats, many of whom have expressed concerns about the 81-year-old president’s candidacy, will have their own meeting later Tuesday.
Donor discontent
A growing number of donors are expressing concerns about Biden’s ability to beat Trump in November.
Nearly 400 donors sent a letter late Monday calling for Biden to “withdraw from being a candidate for reelection for the sake of our democracy and the future of our nation.”
Among those who signed the letter are Lisa Blau, the co-founder of venture firm _able Partners, Kevin Brennan of hedge fund Bridgewater Associates, former Procter & Gamble CEO John E. Pepper, and two former Internal Revenue Service commissioners, Charles Rossotti and Fred Forman.
“To be clear, however this resolves, I will support him or whoever the Democratic nominee is,” Trey Beck, a Democratic donor and former managing director of DE Shaw Investment Management, told Bloomberg Surveillance Tuesday. “We’re going to have to unify behind our candidate and if it’s Biden that’s who I’ll get behind him. I’ll walk on glass for the guy.”
Two brothers behind a successful Manhattan real estate and fashion business are accusing one another of fraud and other shenanigans.
Albert Malekan, founder of the high-end Alberto Makali clothing line, is accused in a legal filing by younger brother Michael Malekan with stealing money, filing fraudulent tax returns, and driving a prime SoHo retail property into default.
“For years, Albert operated the family [business] like an unaccountable dictator operating a personal fiefdom,” Michael said in his complaint, which asked a judge to strip his brother of control of the family business, including several Manhattan properties. Records show holdings include four mixed-use buildings in SoHo and Midtown estimated to be worth $60 million.
Albert has countersued and accused Michael of fraud, breach of fiduciary duty, and misappropriation of trade secrets. He described his brother as a “faithless servant” and bitter ex-employee who tried to hurt the family clothing business by sending customers to a rival store he secretly formed called Ooh La La. Albert alleged Michael took $244,000 in excess distributions out of Alberto Makali.
The feud casts light on a New York real estate family that has mostly stayed in the shadows until now. Neither Michael nor Albert Malekan would comment, nor would their lawyers.
“I’m not telling you a thing. Not one thing. Zero,” said an attorney for Albert Malekan, Stephen Siminou. An attorney for Michael, Mara Levin, said she interrupted a call discussing media strategy to speak briefly to Crain’s and didn’t call back or return a subsequent call.
The brothers’ suit and countersuit were both filed last year but escaped attention until a bond-rating firm noted the existence of the legal dispute in a report analyzing the mortgage for a building owned by Albert Malekan that isn’t part of the litigation. Last month a state judge gave the warring parties a January deadline to produce evidence.
Albert Malekan hails from western Asia, according to Alberto Makali’s website, and state court documents indicate Farsi, the language of Iran, is the family’s native tongue. Albert and Michael’s father, Elyaho Malekan, was an art collector who in 2008 sued a dealer for allegedly making off with an artwork from czarist Russia. Elyaho Malekan said the dealer told him, “They [the Russian Mafia] would kill [Malekan] or members of [Malekan’s] family if [Malekan] made trouble.”
Albert Malekan moved to the U.S. at an unspecified date to study at Columbia University and introduced women’s wear to his brother’s store, according to Makali’s website. Movie star Heather Graham wore an Alberto Makali dress that she said “felt like springtime” while doing press interviews before the Tribeca Film Festival in 2013.
Along the way, Albert “cultivated an eye for design and developed his entrepreneurial spirit” and began investing in real estate 30 years ago. He owns Manhattan properties including 75 Greene St., 466 Broome St., 419 Lafayette St., and 552 Seventh Ave., records show. The city Department of Finance estimates their combined value is about $60 million. The locations of other properties couldn’t be determined because they’re owned by LLCs.
419 Lafayette is a 75,000 square-foot office building whose tenants include M13, a venture capital firm run by Paris Hilton’s husband, Carter Reum. The building recently secured a new $20 million mortgage from Citigroup, and Malekan pocketed $15 million in cash as part of the transaction, bond-rating firm KBRA said in a report last month.
Albert Malekan is the sole managing member or “de facto managing member” of each property and maintains exclusive management, control and operation authority over each, Michael’s lawsuit says.
Michael alleges Albert cheated him and other family members repeatedly. In one example, Albert allegedly allowed Donatella Versace to buy out her Greene Street store’s lease during the pandemic in return for a $3 million payment. But the money wasn’t shared with Michael, who controls a 20% stake in the building along with brother-in-law Shahram Golpanian.
In another case, Albert allegedly allowed beauty retailer Jill Stuart to walk away from its Broome Street store, where it owed more than $500,000 in back rent, in return for a cash payment and the store’s remaining inventory, which was then sold in a different shop run by Albert’s wife. Proceeds weren’t shared with family shareholders, Michael alleged, and Albert mismanaged the SoHo property so badly that it went into default, forcing family members to pay “excessive penalties and interest” in order to avoid foreclosure.
“The above examples do not even scratch the surface of Albert’s misconduct,” alleged Michael, who further accused his brother of “intentionally manipulating books and records to make it look as though the properties are operating at loss.” That, he contended, was done in order to force family members to pony up more cash to lenders or to substantially devalue the buildings.
Michael said Albert has directed his accounting firm to file “fraudulent tax returns” on behalf of the family real estate business. For example, in 2020, the Greene Street building received a $2.2 million lease termination fee but the income was not reflected in the property’s tax return.
“In the event the 2020 tax return was audited by the IRS, taxes, interest and penalties would be levied as a result,” Michael alleged.
A massive cannabis retailer is coming to Times Square this fall, according to one of the business partners involved in the new venture.
James Mallios, an attorney who now specializes in the hospitality and real estate industries and who serves as managing partner of restaurants on Long Island and in the city, is teaming up with William Norgard, a U.S. Army veteran who sued the state — and won — over the eligibility requirements for its much-maligned rollout of legal weed shops, to open up a state-sanctioned, 3-story cannabis retail experience in the entirety of the building at 719 Seventh Ave.
Norgard, along with three other veteran plaintiffs, had accused the state of favoring applicants who had gone through the criminal-justice system for a cannabis-related offense over disabled veterans like himself. The case was settled last year, and Norgard and his business partners were granted a provisional license from the state in order to open at the Seventh Avenue location, which also goes by 30 Times Square, according to Mallios and state records.
"We're excited to, in the fall, unveil what is possibly the largest retail cannabis store on the eastern seaboard, in the middle of arguably one of the most visited places on the planet," said Mallios.
Norgard and Mallios, together with others who remain unidentified, signed a 20-year lease for the roughly 10,000-square-foot space under the limited liability company 2 Forest Park Lane, records show, whose address is linked to a Mykonos-inspired restaurant in the Hamptons called Calissa. Mallios serves as the managing partner of both Calissa and Amali, a Mediterranean-inspired restaurant on the Upper East Side.
The building's landlord, whom Mallios declined to name, bought the property in the heart of Times Square from SL Green for $32.4 million under the limited liability company AMWB 719, which appears tied to Miami-based firm Boich Investment Group and former SL Green President Andrew Mathias, according to a June deed that appeared in the city register last week. SL Green purchased the original Seventh Avenue building, at the corner of West 48th Street, for $41.1 million in 2014, records show.
Mallios said he and Norgard are in the process of obtaining a trademarked name for their new enterprise, which he says will offer a unique experience on each floor and differ greatly from the many other — and what he called "typical" — legal dispensaries currently in operation throughout the city, including one just around the corner on Eighth Avenue. Mallios also described the new business as "luxury" but declined to expand further on what exactly that means for the shop.
"We're very excited about the look and feel of the store," said Mallios, who declined to comment on the details of the lease agreement.
SL Green declined to comment on the sale of the building, citing a "quiet period" leading up to its earnings call. And neither the Dallas-based family investment firm VerCap Management, which provided $23 million in financing, according to city records, nor Boich Investment Group responded to requests for comment by press time.
Tourists have once again been flocking to Times Square as the city continues to recover from the pandemic, even as the occupancy rate of its commercial real estate sector has taken a bit of a dip in the last year, according to the latest data collected by the Times Square Alliance. In May of this year, 243,352 pedestrians visited the area daily — down slightly from the 306,523 who visited during that month last year — and its occupancy rate dropped from 82.3% in 2023 to 76.4% so far this year. And according to the report, 84% of its storefronts were open for business in May 2023.
Extreme heat forced the metal of the Third Avenue Bridge linking Manhattan and the Bronx to expand and become stuck for several hours Monday afternoon — a phenomenon that increasingly threatens to disrupt traffic across the city’s moveable bridges as heat waves become more frequent and intense due to a warming planet.
The Third Avenue Bridge rotated to let a vessel pass on the Harlem River at roughly 2:45 p.m. Monday, the city’s hottest day of the year with the temperature spiking to 95 degrees, but was unable to swing to a closed position thanks to an expansion of the overheated steel, said FDNY spokesman Jim Long.
Marine crews with the Fire Department had to hose down the metal and hydraulic system of the century-old bridge to cool it down enough to get the structure moving again; the open bridge snarled traffic until 6:30 p.m., said Long. The situation is a stark example of the less obvious consequences of a changing climate and gives New Yorkers a taste of future disruptions to expect across the city’s two dozen moveable bridges as sweltering heat becomes more common.
“These extreme events are going to, increasingly, interrupt our daily lives,” said Debra Laefer, a professor at New York University's Tandon School of Engineering. “When we design bridges, we design for a certain temperature range, and now, all of a sudden, areas are getting sustained heat like they’ve never had before.”
The city Department of Transportation oversees 24 moveable bridges throughout the five boroughs. Those include two retractile bridges, seven swing bridges — like the Third Avenue Bridge — four lift bridges and 11 drawbridge crossings. The spans run the gamut of linking the boroughs over major waterways, such as the East River, to smaller canals and creeks.
The DOT acknowledged that the city's movable bridges occasionally have difficulties opening or closing due to steel expansion. DOT bridge crews regularly inspect the gaps in movable bridges to ensure there is enough clearance to open and close them; when there is not enough space, typically, the Coast Guard is notified that a bridge is out of service and that vessels must find an alternate route, according to DOT spokesman Vincent Barone.
Laefer said bridge retrofits to mitigate heat expansion are theoretically possible, but addressing the problem is a costly, laborious undertaking that would require rejiggering entire structures.
“That's really the bigger problem: the money and the time it takes, which all takes away from maintenance and other things,” Laefer added. “It’s not something that you can just send one guy out with a grinder and it's going to be fixed in an afternoon. So, I think we are just seeing the beginning of this.”
Here are the city’s movable bridges:
Bronx River
- Eastern Boulevard Bridge
East River
- Roosevelt Island Bridge
Eastchester Creek
- Hutchinson River Parkway Bridge
- Pelham Bridge
Gowanus Canal
- Carroll Street Bridge
- Hamilton Avenue Bridge
- Ninth Street Bridge
- Third Street Bridge
- Union Street Bridge
Harlem River
- 145th Street Bridge
- Broadway Bridge
- Macombs Dam Bridge
- Madison Avenue Bridge
- Third Avenue Bridge
- Wards Island Bridge
- West 207th Street/University Heights Bridge
- Willis Avenue
Newton Creek
- Borden Avenue Bridge
- Grand Street Bridge
- Greenpoint Avenue Bridge
- Hunters Point Avenue Bridge
- Metropolitan Avenue Bridge
- Pulaski Bridge
Westchester Creek
- Unionport Bridge
Elizabeth Sackler, a member of the family that created the opioid-crisis-fueling OxyContin, even though Sackler herself has condemned her relatives’ “morally abhorrent” business, has found a buyer for her uptown home.
Sackler, an arts advocate, is in contract to sell her three-bedroom penthouse co-op at 14 E. 90th St., according to data from Olshan Realty, a brokerage that tracks high-end residential sales through signed contracts.
The unit, No. PHW, a 3,100-square-foot aerie at Fifth Avenue that offers a library with a fireplace, a formal dining room and a wraparound terrace with a greenhouse, was most recently listed for about $12 million.
Whether Sackler was able to get that price for the home, which she bought for $10.5 million in 2007 from former Citi Chairman Sanford Weill, likely won’t be known till the purchase closes and its tax record hits the city register, which could take a few weeks.
But Sackler had initially put the home up for sale in April 2023 at a price of $16 million, suggesting she misjudged the market by at least 25%.
Co-ops and condos have both faced challenges in the past couple of years as elevated interest rates have dragged on activity. But in recent months buyers have indicated that they can’t wait forever for rates to drop and are inching back into the market.
The buyer of the penthouse, which has 10-foot ceilings and Central Park views, and comes with a separate storage unit, is also unknown.
Nick Gavin of Compass and Susan Penzer of Susan Penzer Real Estate, who co-marketed the property, did not return emails by press time.
Sackler’s father, Dr. Arthur Sackler, was one of three brothers who in 1952 purchased the Manhattan-based Purdue Frederick Co. and grew it into a family of companies whose products also included the drug Valium. In 1995 one of the companies, Purdue Pharma, introduced OxyContin, a morphine-like prescription-based painkiller that would go on to become heavily abused. Purdue Pharma officials later admitted as part of a settlement that they downplayed the drug’s addictive qualities in its marketing.
Arthur Sackler died in 1987, eight years before OxyContin’s arrival. And his brothers, Raymond and Mortimer, bought out Arthur’s share in the company upon his death. Elizabeth Sackler has said she never profited from the drug while slamming her family’s role in downplaying its hazards.
But later reporting suggested that relatives of Elizabeth on Arthur’s side of the family could at least be indirect beneficiaries of the blockbuster sales of the drug through a chain of wills and trusts, even if Elizabeth herself is not an heir.
The Sacklers were for decades major arts patrons. But in the aftermath of the OxyContin scandal, museums including the Met in New York and the Louvre in Paris removed the family’s name from its walls, while other institutions stopped accepting Sackler gifts.
Elizabeth Sackler has led major efforts throughout her career to repatriate looted Native American art and in 2007 established the Elizabeth A. Sackler Center for Feminist Art, a woman-centric collection and education space at The Brooklyn Museum
Stamford, Connecticut-based Purdue Pharma filed for bankruptcy protection in 2019. But in late June, the Supreme Court rejected a broad agreement that Purdue Pharma had worked out with local governments as part of its bankruptcy plan that would have had the company contribute up to $6 billion to opioid victims but that also would have shielded Sackler family members from future lawsuits.
But the company, which makes other kinds of pain medications, says it will still work to correct damage wrought by OxyContin. “The decision does nothing to deter us from the twin goals of using settlement dollars for opioid abatement and turning the company into an engine for good,” says a statement on the company’s website.
New York City had lacked a coordinated, long-term citywide plan (encompassing both public and private land) to care for its urban forest. With private lands accounting for an estimated 35% of NYC’s total 42,635 acres of trees, a better understanding and planning for this major share of the city's urban forest was urgently needed.
Last fall, City Council, with immense support from Forest for All NYC, a diverse coalition of over 140 organizations dedicated to protecting, maintaining, and expanding the NYC urban forest to at least 30% canopy cover by 20235 equitably, unanimously passed legislation that mandates the city’s first Urban Forest Plan for trees on public and private property – catching up to other large cities who already have a comprehensive plan for their own urban forests. Local Law 148 of 2023 requires a long-term plan that would put the city on a path to equitably expand the tree canopy from the current 22% coverage to 30% coverage citywide. The law also requires the city to periodically evaluate the distribution, health, and stability of the city’s urban forest, identify the causes of gain or reduction to tree canopy and urban forest cover, and recommend strategies to remediate any urban forest loss.
Notably, the law also requires the city to conduct outreach to help residential and commercial property owners learn about how they can protect and expand their own trees and vegetation, as nearly 35% of the total urban forest canopy is on private property. Additionally, it creates a better way to track the state of tree canopy in the city by collecting more accurate satellite data every five years to monitor the progress towards expanding the tree canopy.
Trees add to the aesthetics of homes and businesses. They also help New Yorkers in so many ways. More trees means cleaner air, more rainwater absorption, more habitat for birds and insects, and more pleasant streetscapes for everyone to enjoy. They keep us cool and help mitigate the inequities of the urban heat island effect, which makes some neighborhoods more than 10 degrees warmer due to excess asphalt and a lack of vegetation. Unfortunately, the city's urban forest is not equitably distributed, with many lower-income neighborhoods often lacking trees and other greenspace due to a history of redlining and disproportionate funding allocations.
That’s why this new plan is so important and it needs the attention and focus of City Hall to ensure it has the resources to meet its own requirements and intentions. With a July 2025 deadline to complete the plan, the time is now to dedicate the necessary resources to ensure a successful Urban Forest Plan is completed – in a meaningful and impactful way.
By getting this plan right, we can ensure that New York City does right by its tree canopy, providing crucial benefits that advance equity, health, quality of life, and resilience for all of its residents.
Good planning takes time and resources to be successful. City Hall and agency leadership must get to work to create an Urban Forest Plan that advances the goal of a 30% tree canopy by 2035, and does so equitably.
We stand ready and willing to work with city agencies to get it done.
City Council Member Erik Bottcher represents the city's 3rd district. Tami Lin-Moges is the Interim New York Cities Director at The Nature Conservancy, the convenor and a leading member of Forest for All NYC.
Leases
Lending platform takes full-floor space in Midtown
Address: 450 Park Ave., Manhattan
Landlord: SL Green Realty Corp.
Tenant: Willow Tree Credit Partners
Lease size: 11,000 square feet
Lease length: Five years
Asset type: Mixed use
Brokers: Howard Tenenbaum and Gary Rosen represented the landlord in-house.
Sales
Upper West Side prewar walk-up rental building changes hands
Address: 945 West End Ave., Manhattan
Seller: Paul and Irene Bogoni
Buyer: 945 WEA Owner LLC
Sale price: $11 million
Asset type: Multifamily
Starwood-linked special servicer acquires Kips Bay retail condo
Address: 300 E. 23rd St., Manhattan
Seller: Feil Org.
Buyer: LNR Partners
Sale price: $11.8 million
Asset type: Retail
Japanese firm buys Park Slope rental building
Address: 96 Sterling Place, Brooklyn
Seller: Sowa Kousan
Buyer: Tsukaki Shoji Co.
Sale price: $16.8 million
Asset type: Multifamily
Financings
The Spiral in Hudson Yards lands $100M
Address: 66 Hudson Blvd., Manhattan
Owner: Tishman Speyer
Lender: Blackstone
Loan amount: $100 million
Asset type: Offices
Lin-Manuel Miranda is wrapping up the recording of a concept album for a new musical co-written by playwright Eisa Davis, according to people with knowledge of the matter. The album will be based on the 1979 movie "The Warriors," whose sympathetic depictions of gang members and gritty cinematography made it a standard bearer for youth counterculture. Representatives for Miranda declined to comment.
It’s relatively unusual today to debut a show as a concept album, although according to Miranda, it’s how he initially intended to launch his 2015 musical "Hamilton." But the process certainly isn’t unprecedented: Musicals including "Here Lies Love," "The Who's Tommy," "Jesus Christ Superstar" and "Evita"also began as albums. When it works as intended, a popular album can create “this enormous advance buzz and huge advance ticket sales for its Broadway run the next year,” says Ryan Donovan, an assistant professor of theater studies at Duke University. “It's another way of building familiarity for audiences.”
According to people with knowledge of the project, the album has been largely completed and features Broadway actors and major pop stars.
Given Miranda’s demonstrated fondness for New York City (the location for his Tony Award-winning musical-turned-movie "In the Heights"), "The Warriors" is a perfect fit. The movie tells the story of a street gang that’s wrongly accused of killing a rival gang leader in the Bronx; with most of the New York underworld out to get them, the gang is forced to fight its way back to its home turf on Coney Island. The movie is based on a 1965 novel of the same name by Sol Yurick, which itself is based on the ancient Greek writer Xenophon’s story Anabasis.
After shooting to international stardom as the creator and star of "Hamilton," Miranda’s stayed busy. He’s written music for the Disney animated films "Encanto" and "Moana," and served as a producer for the film adaptation of "In the Heights." He also co-starred in "Mary Poppins Returns," directed the Netflix movie "Tick, Tick... Boom!" and executive produced the 2019 miniseries "Fosse/Verdon."
Davis is known as a Pulitzer-Prize finalist for "Bulrusher," a play about a clairvoyant, multiracial girl who grows up in a predominantly white town. Davis also wrote and starred in the stage memoir "Angela’s Mixtape," and won an Obie for her acting in "Passing Strange."
The release date of the album has yet to be announced.
The Oklahoma-based arts-and-crafts retailer known for its ownership's conservative political leanings is coming soon to Manhattan.
Hobby Lobby, which opened its first chain in the city on Staten Island in March, has now signed one of the largest leases in Manhattan so far this year, inking a deal for 70,716 square feet at 270 Greenwich St. in Tribeca, according to a new report from JLL on the state of the retail sector for the second quarter of 2024.
Hobby Lobby has more than two dozen locations across the Empire State but so far only one is currently open in the five boroughs, at 280 Marsh Ave. on Staten Island, where former President Donald Trump received 61.6% of the vote in 2020.
A representative for the faith-focused store, whose core values include "Honoring the Lord in all we do by operating in a manner consistent with Biblical principles," indicated that the retailer was looking to expand elsewhere across the city and would have "more exciting news soon" after the March opening on Staten Island.
Hobby Lobby's Manhattan debut was the highlight of the recent JLL report, released July 3, which shows that, overall, the city's volatile retail market continues to bounce back as the average asking rent is up this year compared to last, while the availability rate is down, reaching its lowest level on record. The average retail availability rate hit 15.3% last quarter, down from 21% before the pandemic in 2019 and significantly lower than the peak at 28% in 2021, according to data from JLL, which tracked several Manhattan neighborhoods, including Times Square, SoHo and the Meatpacking District.
Conversely, as the law of supply and demand goes, the average asking rent, for the most part, has increased 5.9% since last year, from $517 during the second quarter of 2023 to $548 this year — although it is still below the average prepandemic.
Zooming in, the availability rate on Madison Avenue has plummeted to a new low, falling from a whopping 16% this time last year to 5.9% during the first quarter of 2024 and to 5.3% for the second quarter of this year — breaking its own record again. And along the lower portion of Fifth Avenue, where the same trend is playing out, the availability rate has similarly dropped to 11.3% during the second quarter of 2024, down from 21% during the same quarter last year and 14.5% during the first quarter of 2024. The upper part of Fifth Avenue, however, has seen a jump in vacancies — from a record low of 10% during the second quarter of 2023 to 17.1% this year, according to JLL.
Another notable move this quarter was Ikea's purchase of 80,000 square feet of retail space in the new Extell Development tower going up at 570 Fifth Ave.
It's unclear how much per square foot Hobby Lobby is paying for its new Greenwich Street space at the base of a 35-story luxury building between Murray and Warren streets. A Barnes and Noble bookstore closed in the building earlier this year and a Whole Foods is on the ground floor. Hobby Lobby did not immediately respond to a request for comment, and Sam Martorella of Ripco Real Estate, who is listed as the broker for 270 Greenwich St., declined to comment.
MENTAL HEALTH CONTRACT: The city Department of Health and Mental Hygiene awarded a $1.5 million contract to Financial District-based nonprofit Vibrant Emotional Health to operate an Assertive Community Treatment team for older adults, according to a notice published in the City Record on Monday. Assertive Community Treatment, or ACT, teams are mobile outreach groups that provide 24/7 rehabilitation, treatment and support services to people with severe mental illnesses.
HEAT ADVISORY: New York City’s current heat advisory is likely to extend through Wednesday, according to a notice sent to clinicians by the city Health Department on Monday. Officials warned clinicians to encourage their patients to visit cooling centers if they do not have an air conditioning unit, as well as spot the signs of heat stroke. While New York City officials continue to offer warnings and recommendations about the dangers of rising temperatures, there are few interventions for people trying to avoid extreme heat.
MEDICARE ADVANTAGE: Private insurers who offer Medicare Advantage plans through the federal government have made thousands of dubious diagnoses that were never treated or outright incorrect, driving up costs for taxpayers, according to an analysis of Medicare records published by the Wall Street Journal on Monday. The diagnoses, which were made solely by insurance companies, included deadly conditions such as AIDS in which patients received no follow-up care, as well as conditions that patients couldn’t possibly have developed. Insurers can add diagnoses to a patient’s profile, even if their doctor doesn’t agree – a rule that incentivizes companies to make their patients look sicker and drive up their profits.
Hospitals in the Northeast and Mid-Atlantic region are generating cash flow after years of financial instability, but high costs for drugs and medical supplies continue to slow growth in their bottom lines, new data shows.
Northeast and Mid-Atlantic hospitals saw their operating margins increase by 1.8% between May of this year and last year – higher than any other region nationwide, according to recent data from the Chicago-based intelligence firm Strata Decision Technology. The median year-to-date operating margin in May was 3.3%.
Hospitals are achieving higher profits in the years following the pandemic as patient volumes ramp up and health systems renegotiate some insurance contracts to cover their costs. But even with that growth, hospitals continue to see their margins fluctuate month after month due to high costs for non-labor expenses such as drugs and medical supplies, said Steve Wasson, chief data and intelligence officer at Strata Decision Technology.
“Compared to two or three years ago, there’s been a steady drumbeat of margin improvements across the board,” Wasson told Crain’s. “But they’re not incredible margins.”
Hospitals nationwide have seen their margins increase. The median year-to-date operating margin for hospitals across the country was 5%, up from just 0.7% last May.
Regional hospitals' margins have increased in large part due to higher patient volumes and revenues, Wasson said. Median operating revenues rose 8% among hospitals in the Northeast and Mid-Atlantic regions within the past year. Outpatient revenue climbed 9.1%, while inpatient revenue rose around 5.5%, according to the data.
But surging costs of medical supplies and drugs continue to offset financial gains. Supply expenses rose 6.4% within the last year, and drug costs rose 10%, the data shows. Drug costs have become a primary expense driver for hospitals, Wasson said, as the U.S. contends with record-high drug shortages.
Despite increasing drug and supply costs, Northeast and Mid-Atlantic hospitals have benefited from flat purchasing services costs, which include contracts for equipment and medical consulting.
Labor costs have also steadied, rising 3% within the region from last year. Labor expenses in the Northeast and Mid-Atlantic have increased at a slower rate than other parts of the U.S. Wasson said. He added that the region benefits from its larger population, allowing it to use a larger pool of resources and manage labor costs more so than rural areas in the South, for example.
Although hospitals continue to face financial pressures, Wasson said he is more optimistic about their financial recovery now than he was during the throes of the pandemic recovery. Hospitals are “setting a strategic plan for the future” as opposed to managing survival, offering hope for future financial sustainability.
Strata Decision Technology publishes monthly financial data from more than 1,600 hospitals across the country.
NYU Langone is planning an $11 million expansion of an ambulatory care hub for children with congenital heart disease, according to state filings.
The Kips Bay health system is planning to relocate its Pediatric Congenital Heart Center at Hassenfeld Children’s Hospital to the first floor of 557 First Ave., according to a recent certificate-of-need application. The new center will span roughly 7,000 square feet to make space for additional exam rooms, technology and support services.
The updated ambulatory clinic will include six exam rooms, six echocardiogram rooms, three phlebotomy stations and spaces for radiologists and support services, according to the application. The health system said that the expansion is needed as more patients come to the heart center in need of care.
NYU launched the Pediatric Congenital Heart Center in 2021 to offer medical and surgical procedures for children with congenital heart disease, which occurs when babies are born with heart defects. The center aimed to centralize subspecialty cardiac services to reduce travel times and inconvenience for patients, and included departments for cardiothoracic surgery, cardiology, lung transplant, radiology and others.
There’s a growing need for specialty care for congenital heart disease, which is the most common birth defect in the U.S., the health system said. Since its launch, the Pediatric Congenital Heart Center has served more than 17,000 patients – a number NYU expects to continue growing.
In addition to medical and surgical services, the ambulatory clinic also offers support services such as case management, behavioral health care, nutrition support and art therapy.
NYU Langone declined to comment on the project. The project will go up for review before state health officials.
NYU Langone has six inpatient locations and more than 300 ambulatory care clinics in the New York City region and Florida.
They pride themselves on being doers; taking decisive action at crucial inflection points and anticipating major power shifts.
Yet in the midst of one of the biggest crises ever to strike the Democratic Party, Wall Street’s most influential donors are resigned to watching and waiting like much of the rest of the country.
The view within Manhattan circles, one top Wall Street executive said on Monday, is largely unchanged since Joe Biden’s June 27 debate: A change at the top of the ticket will boost the Democrats’ chances of beating Donald Trump. That’s even as the president pledged to fellow party members he will remain in the 2024 race, seeking to quell dissent within his ranks as lawmakers return to Washington.
But what’s clear to these ultra-rich bankers and investors is that there’s no obvious path to making the change happen themselves. Some also see sitting on the sidelines as a savvy option, wanting to avoid fueling a narrative that financiers are pushing Biden out.
Money usually talks — but, perhaps, not in this case. Biden’s political operation has some $240 million on hand, and efforts from those like Mike Novogratz to drum up funds for a yet-to-be-determined alternative have thus far fallen far short of that kind of figure.
The senior Wall Street executive, who requested anonymity to speak freely about private conversations, said he’d still bet that there are too many voters who worry about Biden’s age for the president to remain in the race. But, mainly, he’s taken to voicing concerns to family and friends, convinced that only Democratic leaders like Chuck Schumer and Hakeem Jeffries can turn the tide.
Billionaire Bill Ackman, on the other hand, took to X to publicly lay out his view of the state of play. Ackman opposed Biden in the Democratic primary, supporting long-shot challenger Rep. Dean Phillips of Minnesota.
“Absent a more serious health incident between now and the election, it now seems eminently clear that Biden will be the candidate,” he wrote. Ackman said that if the general-election matchup was “Biden vs. Trump, I am definitely voting Trump.”
Biden’s response
Among Washington observers, the feeling is that the next few days will be critical for Biden’s candidacy. Already, at least nine House members have called for him to step aside, and the House Democratic caucus will meet Tuesday morning, which could lead to more defections.
There’s a feeling of inevitability that Biden will bow out, one donor said, who requested anonymity to discuss private conversations. The current parlor game is when and how it will eventually come to pass, the person said.
Biden, 81, wrote in a letter to the group Monday that he is “firmly committed to staying in this race, to running this race to the end, and to beating Donald Trump.”
On MSNBC’s "Morning Joe," he dared anyone who thinks he shouldn’t seek reelection to challenge him at the Democratic convention.
“I don’t care what the millionaires think,” Biden said on MSNBC Monday. “I want their support but that’s not the reason I’m running.”
Still, the campaign needs wealthy donors’ money with Trump and the Republicans now raising similar sums as the Democrats. Biden, along with campaign chair Jennifer O’Malley Dillon and Maryland Gov. Wes Moore joined a call with some of the campaigns largest contributors on Monday.
“The party has spoken. The Dem nominee is me,” Biden said. “We can’t waste any more time being distracted.”
Donations to the campaign have thinned in recent days, with some wealthy donors saying they will withhold any future contributions until Biden is off the ticket, according to a person familiar with the fundraising efforts. The Biden campaign has said that grassroots contributions surged following the debate and reported raising more in June than any other month.
Biden’s sizable war chest had been a selling point for donors, especially compared to Trump’s cash-poor campaign through the primaries. But since clinching the nomination, Trump has caught up and surpassed Biden, and now has $285 million cash on hand, according to his campaign.
Unlike Trump, who’s spent little on television or offices in battleground states so far, Biden’s campaign is employing an expensive strategy. The campaign alone booked $48 million in advertising time last month, according to AdImpact.
“I know a lot of donors who are very unhappy and aren’t going to spend money on the campaign,” said Vin Ryan, founder of Schooner Capital and a longtime Democratic donor. “A lot of money will be diverted to House and Senate races.”
Ryan said a Biden replacement would likely get an outpouring of donor support, with many willing to bet on a younger and more articulate candidate.
Two Democratic fundraisers, who asked not to be identified to discuss private conversations, said they’ve been advising donors to shift their donations to competitive House races even before the debate, but now worry that with Biden atop the ticket, Democratic congressional candidates will lose en masse to Republicans.
“Let’s not blindly follow our friend off a cliff,” Novogratz wrote on X Monday. “It’s time to move on from the gerontocracy.”
Alternative investments
The lack of real power to force Biden out, combined with a desire to prevent a Trump victory, has led some Democratic donors to launch long-shot efforts to find a replacement. Bill Harris, the former chief executive for Intuit and Paypal Holdings, has personally funded polling about voter views of Biden’s age in swing states. Harris contributed to Biden in 2020, but has decided to not give to him this cycle.
Georgetown University professor Rosa Brooks and investor Ted Dintersmith have also concocted a plan for a “blitz primary” that would involve celebrities — such as Oprah Winfrey, Taylor Swift and Stephen Curry — introducing candidates to voters before conducting a snap election to pick a Biden successor.
The plan is novel, but unlikely to come to fruition, even by the authors’ own admission.
“While we hope for help from Lord Almighty,” the plan says, in an apparent nod to Biden’s Friday interview with ABC, in which he said he’d only step down if God told him to, “he/she helps those who help themselves. We need to act. Now.”
Midtown’s Decoration & Design Building, host to a vast private market featuring dozens of vendors serving interior designers, is facing a more than $30 million loss as occupancy falls, furthering the woes of landlord Charles Cohen.
Located across from Bloomingdale’s and Home Depot at the corner of Third Avenue and East 58th Street, the 18-story 600,000 square-foot D&D Building is the sort of place where you might happen upon a showroom with a shimmering wall sculpture resembling the backdrop of Gustav Klimt’s "The Woman in Gold." Another room might feature diminutive club chairs swathed in paint-splattered jacquard, a fabric patented in France in 1804.
But the spectacle is smaller than it used to be. D&D had about 130 tenants in 2015, but a third have left in recent years and net cash flow has fallen by a similar amount. The building has been delinquent on its mortgage since May 2023, and lenders may have to write off $34 million of the $156 million loan balance, bond-rating firm KBRA said in a new report.
A fifth of D&D tenants have leases that are month-to-month or scheduled to expire in 2024, including Stark Carpet, the largest tenant at 37,000 square feet. Stark didn’t reply to a request for comment.
While revenue erodes, costs are rising. Cohen owns the D&D Building but not the land underneath, and the ground rent rose by nearly 50% last year, to $6 million. It is scheduled to rise at an average annual rate of nearly 4%. Records show the ground lease is owned at least partly by the Rice Foundation, which was funded by real-estate broker Henry Hart Rice, who died in 1992.
Officials at Cohen Brothers Realty did not respond to requests for comment.
The D&D was developed in 1965, and Charles Cohen bought it for $70 million in 1996, four decades after his father and uncles started developing office towers on Third Avenue when the elevated train line was dismantled in 1956. Cohen Brothers holdings today include 805 Third Ave., 750 Lexington Ave., and 3 Park Ave. — all of which are struggling with high vacancy rates. The firm controls 12 million square feet of space nationwide, including 3.3 million in four design centers in New York, Houston, Los Angeles and Miami.
The Real Deal has reported Cohen is delinquent on more than $500 million worth of loans, and he’s been sued by lenders including Fortress Investment Group and U.S. Bank for failing to pay. Forbes estimates his net worth is more than $3 billion.
For many years the D&D Building was highly profitable, generating about $23 million annually in net cash flow. Big investments in tenant improvements weren’t necessary on most floors because tenants prefer to build out their own spaces. The showrooms are a place for design-industry professionals to examine new work and negotiate deals away from the prying eyes of the general public.
D&D tenants usually won’t do business with anyone who doesn’t have an account. Westchester County-based designer Lara Michelle said in her article “Demystifying the D&D Building” that if a client wants to go by themselves, she will alert sales staffers to be helpful. But “they still won’t give any pricing directly to the client, that will only go to the designers,” she wrote.
The pandemic disrupted the building’s awards ceremonies and other live events that helped keep the place busy, while retail remains one of the slowest sectors in New York to recover. Headcount remains 14% below prepandemic levels, according to the State Comptroller’s office.
Still, the D&D remains a place where designers and showroom staff cultivate lasting relationships
“It’s become a second office in a sense for me,” Michelle wrote. “With such a concentrated amount of the world’s best products in one building, there is no other place in the area like it.”
C. J. Hughes contributed reporting
Leases
Trading platform relocates from Sixth Avenue to Grand Central
Address: 245 Park Ave., Manhattan
Landlord: SL Green Realty Corp.
Tenant: Tradeweb Markets
Lease size: 76,000 square feet
Lease length: 15 years
Asset type: Office
Brokers: Cushman & Wakefield’s Patrick Murphy, Bruce Mosler, Tara Stacom, Harry Blair, Ron LoRusso, Justin Royce, Pierce Hance and Will Yeatman represented the landlord. JLL’s David Kleiner, Michael Berg, Will McGarry and Finley Burger represented the tenant.
Sales
Developer Wolfe Landau acquires Ft. Greene church
Address: 144 St. Felix St., Brooklyn
Seller: Hanson Place Central United Methodist Church
Buyer: Watermark Capital Group
Sale price: $15 million
Asset type: Religious
Investor picks up post-war elevator building in Fresh Meadows
Address: 137-20 45th Ave., Queens
Seller: Auburn Leasing LLC
Buyer: Black Iris Capital
Sale price: $21.1 million
Asset type: Multifamily
Financings
Buyers of Williamsburg’s William Vale hotel obtain mortgage
Address: 111 N. 12th St., Brooklyn
Owner: EOS Hospitality
Lender: Apollo Global Management
Loan amount: $230.2 million
Asset type: Hospitality
Hollywood power broker-turned-investor Michael Ovitz has unloaded his Greenwich Village apartment two years after a fizzled attempt at a quick flip.
The unit, a four-bedroom at the condo 155 W. 11th St., sold for $23.5 million in a deal that went into contract April 18, closed June 25 and appeared in the city register Friday.
Ovitz purchased the nearly 4,000-square-foot apartment from rocker Jon Bon Jovi in 2022 for $22 million in an all-cash deal and put it back on the market a few months later at $25 million.
But the unit, No. 14A, struggled to find a taker. In the end the apartment traded for a bit more than the price paid by Ovitz, a co-founder of the talent agency CAA and short-lived president of The Walt Disney Co. who in recent years has invested in tech startups.
The buyer of the unit, which features a 39-foot-wide south-facing living room, an eat-in kitchen and a private elevator, used the shell company Bivouac and could not immediately be identified. Representing Bivouac in the deal was Midtown-based attorney Sharon Darouvar, who did not return an email for comment. And Raphael De Niro, the Douglas Elliman agent who brokered the deal on behalf of Ovitz, declined to comment.
The buyer paid in cash, based on property records.
In 1975 Ovitz and other William Morris agency alums founded Creative Artists Agency, which represented many of the top actors of the 1980s before expanding into advertising and business consulting, though Ovitz stepped down in 1995 to run Disney. But after a tumultuous tenure, former Disney Chairman Michael Eisner ousted Ovitz two years later.
In 2010 Ovitz founded venture capital firm Broad Beach Ventures, which is based in Los Angeles. A Broad Beach investment from 2021 involved a $25 million financing round for sales software firm Pathlight, according to Crunchbase.
Ovitz’s romantic partner for about the last decade has been Jimmy Choo co-founder and fashion entrepreneur Tamara Mellon. The couple’s primary residence is reportedly a 28,000-square-foot mansion in Beverly Hills.
For his part, Bon Jovi (a CAA client) snapped up No. 14A in 2017 for about $19 million, also in an all-cash deal, according to the register. The seller then was Rudin Management, the developer of the condo, part of the Greenwich Lane complex near Seventh Avenue South on the former site of St. Vincent’s hospital.
The Ovitz transaction may not be the only high-profile recent resale at the condo involving a media executive. In late June former Village Voice publisher Peter Barbey listed his penthouse at the building for $32 million.
Regional officials behind the long-delayed Hudson Tunnel project linking New York and New Jersey have secured a $6.8 billion federal funding agreement to advance the $16.1-billion project that will overhaul a crumbling, century-old rail tunnel and add a new one.
The deal caps Washington's financial commitment to the Hudson Tunnel project and evades concerns that a possible change in the Oval Office following November’s presidential election could once again derail construction. The accord has been in the works for years. With a signed federal funding agreement the Gateway Development Commission, which oversees the project, will begin major construction this month, with the project’s completion slated for 2035.
Kris Kolluri, Gateway Development Commission chief executive, described the signed funding agreement at a Monday news conference as “the point of no return” for the infrastructure project.
“This time it's real,” added Senate Majority Leader Chuck Schumer. “The Gateway race was truly a marathon but we laced up, kept the pace and we made it.”
Revitalized rail infrastructure under the Hudson is key to the financial health of the region and the U.S. at large. The Northeast corridor is Amtrak’s busiest with more than 2,200 daily trains stretching from Boston to Washington. It’s also infamous for infrastructure failures that often snarl commutes and delay rail freight.
The sprawling Gateway project includes the construction of a new underwater tunnel along with the replacement of an existing one that was damaged by Superstorm Sandy in 2012.
The price tag for the new tunnel under the Hudson River has climbed to $16.1 billion, an estimate that is 14% higher than a previous 2021 projection. The signed federal funding agreement is the largest and final tranche of $12 billion in federal grant dollars secured for the tunnel project. Some 70% of the project's cost is being covered by the federal government, with the rest paid for by New York and New Jersey, along with contributions from Amtrak and the Port Authority of New York and New Jersey.
What’s going to happen to Joe Biden?
Before June 27th, the night of the first presidential debate, it was unthinkable that Biden wouldn’t easily secure the Democratic nomination at the convention in August. Biden had won more than 99% of the delegates and he was, despite dismal approval ratings, popular enough with Democrats. Age-related concerns had dogged him for many months — he is in his eighties, after all — but most members of the political class and media expected him to push through and stand strong against Donald Trump.
As most Americans know, Biden’s debate performance was so disastrous that his political future is suddenly imperiled. Biden, at certain points in the debate, was barely coherent. For those who had paid close enough attention to the president over the last two years — I had argued, in 2022, Biden should consider stepping aside and permitting an open primary to replace him — his failure to adequately debate Trump wasn’t a shock. But it was jarring to see, nevertheless, and it exposed the lie that the 81-year-old president hadn’t declined since 2020.
The Democratic Party, as the old cliché goes, is in disarray — or at least it is at the presidential level. Democratic Senate candidates have outpolled Biden, and House candidates might flip enough seats to make Hakeem Jeffries of Brooklyn the speaker. The fear, among down-ballot candidates, is that Biden might be a great enough drag in November to doom many of them. Trump continues to lead in national polls and has been making gains in key states since the debate.
Logic would dictate Biden decides to stand down. But the path to doing that is quite fraught. His vice president, Kamala Harris, isn’t polling much better than him. Other alternatives, like Gavin Newsom, Gretchen Whitmer and J.B. Pritzker, seem unlikely to secure delegate backing at the convention. These delegates, many of them party insiders, will follow the lead of Biden.
What Biden has going for him is that few leading Democrats are opposing him in public. Several top-ranking lawmakers, like Jerry Nadler, have indicated they don't think Biden should run again, but there's no loud chorus yet of Democrats calling for Harris or another nominee. Nancy Pelosi, the former speaker, and Jim Clyburn, a close Biden ally, have equivocated but have ultimately stuck with him. Others remain in Biden's camp.
One of those Democrats is Gov. Kathy Hochul. Hochul is a superdelegate and Biden loyalist. She has not wavered since the presidential debate. She is not a decisionmaker within the national party, but it matters that she, and the many delegates from New York, have not opposed Biden. As long as that’s the case, Biden will have the nomination.
The reality is that the time for Biden to leave the race was many months ago. A convention could select a new nominee and there’s a good argument to make that anyone, Harris included, would be preferable to a struggling 81-year-old who would be 86 if he finishes a second term. There’s a difference, though, between what should happen and what will happen: Unless Biden, himself, decides he’s had enough, he’ll be the nominee.
He can’t, as the president, be forced out.
Does that mean Trump will be president again? The odds favor him, even after his hush money conviction in New York. He’s run a fairly disciplined campaign, blasting away at Biden on immigration and inflation.
Biden, in turn, has offered little in the way of any vision for the next four years. He’s accused Trump of wanting to end democracy; he’s framed this election, like 2020, as a battle for the soul of the nation. Whether this playbook can work again remains to be seen.
What can work for Biden is that Trump is still unpopular, and there are plenty of swing voters alienated and exhausted by the idea of another Trump presidency. Biden has a narrow path to victory — he’ll need the blue wall Midwestern states, and he can’t afford to lose Arizona, Georgia and Nevada — and it’s not impossible to executive it. It’ll be all that more challenging since Biden seems increasingly incapable of undertaking the aggressive campaign schedule of a prototypical candidate.
Even if Biden survives this news cycle and becomes the nominee next month, life for him and his campaign will only get harder. That’s one prediction that’s easy to make.
Ross Barkan is a journalist and author in New York City.
A week before the surgeon general declared gun violence a public health crisis, called for more research and said hospitals should routinely discuss firearms safety with patients, a 15-year-old boy in New York City experienced what that might look like, and how efforts Congress allowed just five years ago are already reshaping emergency departments.
The teenager, Henry, had breathing problems in the morning, so his father brought him to the Cohen Children's Medical Center in Queens. He got the treatment he needed, but also was asked the sorts of questions Surgeon General Dr. Vivek Murthy and the White House have recently suggested should be a routine part of treatment.
"Do you have access to a firearm inside or outside of your house?" asked Louise McEvoy, a pediatric emergency department nurse at the hospital, which is part of New Hyde Park-based Northwell Health.
Everyone who visits Cohen's emergency department gets that question. It's standard protocol and an outgrowth of one of the first gun research grants the National Institutes of Health awarded in 2020, the year after Congress ended an effective ban it placed on federally funded gun violence research in 1996.
Northwell doctors would like to see their protocol become a model that spreads nationwide, not to control guns, they explain, but to control a public health threat that has seen firearms become the leading cause of death among children and teens. The federally funded research may help that to happen, and such universal screening practices already can be found in several emergency departments around the country.
The Northwell work could provide the blueprint that Murthy and the White House are seeking.
When Henry answered "No" to having access to a gun, McEvoy proceeded to the next question, which she knows by heart but is also printed on a card that staff can wear on their lanyards. It also pops up on computer screens when nurses take medical histories. "OK, do any of your friends carry firearms or guns or razors or knives?" she asked.
"Probably," Henry said. McEvoy asked how many.
Five or six, he said. McEvoy moved on, asking whether he ever had firearms pulled on him, heard gunshots in his neighborhood or gotten in serious fights. This took 30 seconds, and McEvoy spent another few seconds checking boxes back at her computer terminal and sending the results to other members of the team. An answer of five or more friends with weapons turns the check box red and alerts a social worker.
Less than 30 minutes earlier, a 13-year-old boy with an injured wrist got the same quiz, and acknowledged having a couple of friends with BB guns. That did not trigger an alert, but McEvoy said she would probably mention it to a social worker anyway in case anyone wanted to dig deeper.
The families in this article signed waivers allowing a reporter to witness their interviews, but Modern Healthcare is withholding their names to protect their privacy.
Focus on holistic care
The idea behind the practice and the research is that an emergency department can be more than just where kids get treatment after the fact. It can be an active participant in driving down violence.
"Pediatrics focuses on the holistic experience, the holistic child, and realizes that while they're there right now, sure, we'll take care of that. But this is an opportunity to do other care for the child in general," said Dr. Joshua Rocker, chief of the pediatric emergency department at Cohen Children's Medical Center. "That may include, 'Do you want us to test for HIV?' 'Oh, is there a gun in your home?'"
In order to meet the broader goals, once a patient admits to certain levels of violence or exposure to violence, a system has to kick into action. When someone's answers prompt an alert like Henry's did, the response starts with a visit to the bedside, said Dr. Monica Shekher-Kapoor, director of the hospital's community health initiatives.
"Our social workers will go in and see if there's anything we can help the family with. We can give them resources to a program. Do they need a gun lock?" Shekher-Kapoor said. The emergency department keeps gun locks on hand to give away, along with instructions in their use, much like it provides overdose treatments in cases where illicit drug use is apparent, she said. "Is there something else going on that we don't know about?"
Social worker Jo-Ellen Foti came to see Henry and his father. When she delved deeper, the boy changed his assessment from five or six to "maybe like two," with the possessors of the weapons shifting from his friends to his friends' family members, and with those weapons being left at home, not carried.
Foti offered, in a conversational manner, some general advice to maybe call dad and head on home should someone ever bring one of those weapons out, then shifted to more relaxing topics such as Henry's summer plans and favorite subjects in school.
Make gun talk normal
Still, one aspect of asking about guns — of which the staff is acutely aware — is it can make people nervous or upset. Henry's father demonstrated those concerns when he made sure to ask, when the talk was over, if someone was going to get in trouble.
"I don't want any problems," the father said.
"This is just a conversation we're having with families," Foti answered. The intent, she told him, is simply to get these matters out in the open so kids can be safer.
"We have to make it more normal to talk about, like, who are your friends? What are they doing? Do they have weapons? Are they smoking? Are they this, are they that — because our only concern is Henry, that you're safe," Foti said. "And that's all. This is just a conversation between us here at the hospital and no further than that. But we're always here."
Foti said later Henry's father hearing the higher estimate brought a potential danger to light. "The real conversation will probably happen in the car on the way home. 'Five friends!?' So that's good," Foti said.
While there is a lot going on behind the scenes, and the father and son are on the receiving end of an ambitious gun safety initiative, the staffers very intentionally do not try to push a specific agenda on patients or their families. The idea is to be a resource, if desired.
This approach helps on two other fronts that any hospital would have to consider — the comfort level of the staff, and the heated politics around guns.
Win over the staff
McEvoy, who counts a lot of police and ex-military among her friends, said when Northwell began the program, some of them thought the health system wanted to take away people's guns.
That fear and the reactions families may have to gun questions worried McEvoy, but she said making gun and violence questions just another part of broader safety discussions has helped her and other employees.
"People found in the beginning they did actually feel quite uncomfortable," McEvoy said. "Then it became just more normal, so now it's just a matter of: We ask them about drugs and alcohol. We ask them about safe sexual practices. Why not ask them if they have any reason to be feeling unsafe? It got a lot easier."
Offering t-shirts, pins and other perks didn't hurt with getting staff involved, either. "People like the swag, so they started asking questions," McEvoy said. "It works."
There are also weekly and monthly events designed to keep staff engaged and get new hires up to speed in such a fraught environment, where there can be high rates of turnover. The question cards serve as constant reminders, and posters visible throughout the emergency department notify employees and patients that firearm safety questions are routine.
For patients, and especially parents, a judgment-free focus on safety eases worries about political agendas in a hospital that sits on the edge of New York City, but draws from more conservative precincts of suburban Long Island, said Dr. Chethan Sathya, director of Northwell Health's Center for Gun Violence Prevention.
"This is not an issue that's right or left," said Sathya. "It's really not political. It's not about taking people's guns away. It's about safe storage, violence prevention. It's just the way you frame it. You can't vilify anybody in this epidemic. It's about coming together for the common goal."
Sathya got a $1.4 million NIH grant to run his pilot screening program. Congress has authorized $25 million a year since 2020 for such research, split between the NIH and Centers for Disease Control and Prevention, although legislation the Republican-controlled House advanced recently would end such funding.
'Transformative' funding
Dr. Katherine Hoops, director of clinical programs and practice at the Johns Hopkins Center for Gun Violence Solutions at the university's Bloomberg School of Public Health in Baltimore, is conducting an NIH-backed project on similar screening methods. Federal money has sparked a surge in research, she said.
"The availability of federal funding for firearms-related and violence prevention research has been pretty transformative," Hoops said, referring not just to government-supported studies but to a burst of privately funded efforts, as well.
The results of such work is starting to spread. Besides Northwell's pilot, Sathya pointed to hospitals in Michigan and western New York that are employing similar approaches.
Indeed, Sathya, with the backing of Northwell Health President and CEO Michael Dowling, has assembled a network of physicians at more than 600 hospitals in 38 states who participate in a forum sharing data and insights. They also created the National Health Care CEO Council on Gun Violence Prevention and Safety, which has raised $10 million for an Ad Council campaign and aims to raise $30 million more.
Still, Sathya estimated that fewer than 1% of hospitals are doing across-the-board screening that resembles his model. He expects momentum to grow dramatically, even though many hospitals face financial challenges and might be reluctant to devote resources to new screening programs, with attendant infrastructure and follow-up expenses.
The reason, Sathya said, is reducing gun violence isn't just in the interests of patients. It can boost a hospital's bottom line. First, there is money available in the Bipartisan Safer Communities Act of 2022 and other sources to help cover costs of staff hours spent working with the community and implementing new initiatives.
Then there's the benefit of having fewer gunshot patients, particularly in a level 1 trauma centers such as the two Northwell operates, where Medicaid is usually the main payer for gunshot victims.
"You don't really get reimbursed for your total cost, or what you charge, so hospitals lose a lot of money on Medicaid patients," Sathya said. "If you're filling your EDs with gunshot victims from Medicaid, your loss is huge as a hospital."
Even beyond lowering gun violence, Sathya sees advantages to hospitals being more connected to the people they serve. "Community health is critical," he said. "The better, the healthier the community is, the better you're going to do as a hospital. That just makes sense."
Plus, medical professionals and health care administrators prefer to work in healthier areas, Sathya said. "There's a huge economic incentive, I think, around revitalizing your communities. Hospitals want vibrant communities around."
The owner of Saks Fifth Avenue is acquiring Neiman Marcus Group for $2.65 billion — a deal that will unite America’s two largest high-end department-store chains in a bid to grab a bigger share of a slowing industry.
Amazon and Salesforce will help facilitate the deal by Saks owner Hudson’s Bay Co. The tech companies will take minority stakes in a new company, called Saks Global, according to a statement Thursday. HBC will also finance the deal with $2 billion raised from investors. And affiliates of Apollo Global Management are providing $1.15 billion in debt financing.
Representatives for Salesforce and Amazon declined to comment on an earlier report about the deal. The statement didn’t disclose the size of their investments.
The combined operations would include 39 Saks Fifth Avenue stores and 36 locations under the nameplate of its Dallas-based competitor, as well as two Bergdorf Goodman stores in Manhattan. Both chains also have outlet stores. The goal of the deal is to cut costs and boost profitability by giving the new company bargaining power with vendors and reducing supply-chain and other shared costs.
Marc Metrick, chief executive of Saks Fifth Avenue’s online operations, will run Saks Global. “How do you future-proof a brand like Saks or Neimans or Bergdorf? You do that through technology,” Metrick said in an interview.
The deal is the culmination of on-again, off-again talks between the two privately-held competitors during the past decade and a half. Momentum began to build when Neiman declared bankruptcy in 2020, shedding debt and making it a more attractive target, and accelerated as luxury sales have weakened in the past year or so.
Neiman’s bankruptcy also brought in new owners — Pacific Investment Management, Davidson Kempner Capital Management and Sixth Street Partners — that typically seek a relatively quick return on their investments, rather than spend years in the minutiae of a retail turnaround.
Tech stakes
The involvement of Amazon “adds a bit of spice to an otherwise predictable deal,” GlobalData analyst Neil Saunders wrote in a research note. Its stake makes sense, he said, “as it has ambitions to play more heavily in the luxury space and this would give it a toehold.”
This is among Amazon’s first investments in a physical retailer since it bought Whole Foods Market in 2017 to help the online retailer push into the grocery business. The e-commerce giant has tested the waters in other industries, too, taking stakes in cargo carriers behind its Prime Air delivery business, for example.
Salesforce has touted luxury-brand partners such as Louis Vuitton and McLaren but doesn’t usually take direct stakes in the companies. Its venture investments page lists dozens of stakes in software startups, not retailers.
Real estate
Department stores are in flux. Nordstrom’s founding family has said it’s considering taking the retailer private. The new CEO at Macy’s is rolling out his turnaround plan, which includes shutting almost a third of the company’s namesake stores — part of efforts to address demands from activist investors.
A decline in share prices across department stores has been driving the recent uptick in deal activity, Fitch Ratings analyst David Silverman said. Department stores also have coveted real estate, which is part of what motivated HBC to go after Neiman Marcus. The company owns its namesake Canadian department-store chain, and CEO Richard Baker is also a real estate investor.
The combined companies will have a U.S. real estate portfolio worth $7 billion, according to the statement. Recent luxury deals have been a bright spot for New York commercial real estate, which has been in the doldrums since the pandemic.
Geographically, there isn’t a lot of overlap in the brick-and-mortar networks of Saks and Neiman Marcus. Saks has more stores on the East Coast, while Neiman has a bigger footprint in the southern and western U.S.
Both Saks Fifth Avenue and Neiman Marcus saw a jump in sales from the end of 2020 through 2022 as consumers spent their extra pandemic savings on expensive handbags and other luxury items. But those gains faded as inflation surged, and quarterly sales at both companies have been falling year-over-year.
Competition has also been rising, including from the very partners Saks and Neiman have worked with for decades. Luxury brands, such as those owned by conglomerates LVMH, Kering SA and Richemont, have been focusing on selling more of their own products on their own websites and opening stores in recent years, too, pivoting away from department stores.
Executives at luxury brands have said they prefer to have more control over how their merchandise is displayed and how customers are treated in their stores, as well as where their stores are located — efforts that are helping to drive traffic to their shops. That’s been a further blow to department stores.
“The department-store model has been failing because the whole business was designed for a completely different retail environment than what we have now,” Morningstar analyst David Swartz said. “Every part of department stores has been challenged by competition.”
Those challenges already felled one-time peers such as Barneys and Lord & Taylor. Macy’s-owned competitor Bloomingdale’s, though, is faring better and comparable sales rose slightly in the most recent quarter.
Analysts expect the Saks-Neiman deal to attract antitrust scrutiny from regulators. Under Federal Trade Commission Chair Lina Khan, who was appointed by President Joe Biden, the agency has brought the highest number of merger challenges since 1976, when the U.S. began requiring antitrust reviews before a deal closes. In April, the FTC sued to stop the owner of the Coach brand from acquiring the parent of Michael Kors, the first time the agency has tried to stop a deal in the fashion-accessories sector.
“I have to respect the process that the FTC is going to go through,” Metrick said in the interview. Saks Global plans to improve the brands’ websites, including making it easier to search for merchandise and make offerings more personalized to each shopper, while also investing in stores.
“As a consumer,” Metrick said, “you’re going to win.”
When organic chemistry, a notoriously difficult college course, got the better of Scott Spector during his freshman year at the University of Michigan, he had to rethink his dreams of going into sports medicine.
Spector, a lacrosse player at the school, pivoted to its architecture program, for which physics, a subject he excelled at, was a requirement. After graduation, Spector pursued his master's degree in architecture at the University of Maryland and ended up following in his father's footsteps.
Spector's dad, Michael Harris Spector, started his eponymous architecture firm, Spectorgroup, in the mid-1960s. The younger Spector joined the company in 1987 and took over in 1998 — a year before his father retired — and spearheaded the opening of its New York City office; his father died in 2018. The firm was at first based on Long Island, but it later moved into the city and as of almost two years ago is now headquartered at 200 Madison Ave. — a space that, naturally, Spector's team designed.
Now approaching its 60th anniversary, Spectorgroup has become one of the premier architecture firms for major building renovations and commercial interiors in the New York City metro area. The firm opened an office in Miami about a year ago. Spector says his work has taken him all over the country. For his next big projects, he has his sights set on West Palm Beach, Chicago, Atlanta and Austin.
"I spend roughly 90% of my time in the New York metro area," he said. "But all these lovely clients keep taking us everywhere. So I tend to be on a plane a little bit more often than normal."
Spector serves as the principal of the firm. He spends part of his days doing typical office work, such as collaborating with his team and communicating with current and prospective clients. But a large chunk of his week is spent actually touring the sites on which he plans to work.
Spector also oversees the entire firm to ensure the completion of each project, which recently included office spaces for Citrin Cooperman, Applied Underwriters and The Carlyle Group. He finds the creative process to be the most fulfilling part of his work and enjoys seeing the end result.
"I take pride in being able to shape the way that people live, work and experience the built environment," he said.
In the five boroughs, Spectorgroup has handled projects everywhere but Staten Island. His team has designed the headquarters for large accounting firms and well-known technology, legal and entertainment companies such as Colliers, Uber and VaynerMedia. The firm also helped redevelop Brookfield Place and the old Jehovah's Witnesses watchtower in Dumbo, which was bought in 2013 by RFR Realty and Kushner Cos.
Spector's team mainly focuses on commercial buildings but plans to take on more specialty retail, concierge-type environments and fashion showrooms in the near future.
Last year, Spector estimates, his firm worked on projects that totaled between $250 million and $300 million in construction costs, and said he averages around the same each year on about 150 different projects. The firm typically takes in about $15 million a year in architectural fees associated with that work, including for design and other basic services, he said.
The key to designing a world-class building, Spector says, is using materials that not only look the best aesthetically but are also the most structurally sound — a lesson he learned from his father.
"If you're going to go into the world of architecture, you have to have an education not only in design, but you also need to understand how to build a building," he said. "If you come in with just the fantasy of the architectural design, you need that foundation — literally — to understand how to put things together."
Several influential congressional Democrats said privately on Sunday they want Joe Biden to step aside as the party’s White House nominee, as the president enters a pivotal week for his teetering reelection campaign.
The latest defections include several Democratic leaders of House committees, a signal that even some party stalwarts in Congress want a new person at the top of the ticket following Biden’s stumbling debate against Donald Trump last month.
The defections include Jerry Nadler and Joe Morelle of New York; Adam Smith of Washington; and Mark Takano of California, according to people familiar with the discussion. The members expressed their views in a private virtual call on Sunday afternoon organized by House Minority Leader Hakeem Jeffries. That amounts to a total of nine House Democrats who have called for Biden to step aside.
The fallout from Biden’s June 27 showing against Trump continues to reverberate. The incumbent president has been defiant against calls for him to step aside, repeatedly saying that he has no plans to suspend his reelection campaign. But this week presents fresh challenges as Biden hosts members of the North Atlantic Treaty Organization in Washington and members of Congress return to the Capitol after largely being away since the debate.
Most, if not all, of the participants in the call with Jeffries are Democrats not facing much danger of losing their November campaigns. Their posts atop congressional panels reflect, in part, their seniority and relative reelection security. Many have worked with Biden in some capacity over his nearly five decades in government.
Senior Democrats, including Richie Neal of Massachusetts and Don Beyer of Virginia, said in statements after the meeting that they want Biden to stay in the race.
A regularly scheduled meeting with all House Democrats set for Tuesday morning will be more telling of the sentiment across the caucus, and will include those members facing competitive reelection contests and who fear down-ballot repercussions from Biden voter fallout.
Panic is more pronounced in the House than in the Senate, because Democrats in that chamber had high hopes of taking the majority prior to the debate.
Jeffries’ spokesman declined to comment on the meeting, saying it was a private call.
Democrats doubt
Several leading Democrats also spoke publicly Sunday in televised interviews: None directly called for Biden to leave the race, but they questioned whether he should go forward.
“The performance on the debate stage, I think, rightfully raised questions,” Representative Adam Schiff, Democrat of California, said on NBC’s “Meet the Press.” “He should be mopping the floor with Donald Trump.”
“It should not be even close,” Schiff added. “And there’s only one reason it is close, and that’s the president’s age.”
A reported meeting that was being arranged for Monday by Sen. Mark Warner of Virginia so Senate Democrats could discuss their support of Biden remaining on the presidential ticket isn’t going to occur, a person familiar with Warner’s thinking said Sunday.
The person said the meeting was never actually scheduled, but that the idea was floated to have a private, in-person conversation. Once the idea of this gathering was publicly reported, the meeting became impossible, the person said. Instead, Senate Democrats will talk Tuesday during their regular caucus.
The internal party struggle is playing out as Biden himself works to right his campaign, trying to convince voters at home and foreign leaders of his fitness to serve another four years.
Biden starting Tuesday is hosting a summit of NATO leaders and officials, some of whom expressed their worries about the president’s age and attentiveness privately during the Group of Seven meeting in Rome last month. The wars in Gaza and Ukraine heighten the pressure, given the U.S. role in corralling allies.
Biden raised the stakes of the meeting in his ABC News interview on Friday, effectively saying that he should be judged on his ongoing efforts to reassert America’s place on the world stage.
Campaign efforts
The president is also stepping up his campaign to show renewed vigor. He’s visited two battleground states in recent days, Wisconsin on Friday, and then made stops on Sunday in must-win Pennsylvania, the state where he was born but which a Bloomberg News/Morning Consult Poll shows him trailing by seven percentage points.
“If it wasn’t for Biden, Trump would be at the White House and he would be campaigning for his third term,” said Sen. John Fetterman, the Pennsylvania Democrat who noted he also had a difficult debate after suffering a stroke — and went on to win his race. He expressed his strong support at a Biden event with campaign workers in Philadelphia.
“I know I don’t look like I’m 40 years old,” Biden joked at the Mount Airy Church of God in Christ, a Black congregation in Philadelphia. “All kidding aside, you know I’ve been doing this a long time, and honest to God, I’ve never been more optimistic about America’s future.”
He later traveled to an event in the Pennsylvania capital of Harrisburg.
Starting July 15, after the NATO summit, Biden will go to Austin to mark the 60th anniversary of the Civil Rights Act, then to Las Vegas to address the NAACP Convention and the UnidosUS Annual Conference, according to a White House official. The Las Vegas events target Black and Latino voters, two key constituencies.
Despite the defections, Tevi Troy, senior fellow at the Bipartisan Policy Center and former senior White House official for the George W. Bush administration, said he questions “this premise of growing pressure because I’m not sure that’s the case.”
“The Biden people have set it up in such a way it’s very hard to get rid of him unless he chooses to. And he’s not gonna choose to, unless people he trusts tell him to step down. And the people he trusts are in positions that are dependent on him being there,” Troy said.
A business-aligned group that has pushed tech solutions for government problems is now turning its attention to New York City’s Buildings Department, which finds itself at the center of multiple major policy issues.
The Partnership for New York City, through its investment arm, already runs two “Innovation Labs” where technology companies compete annually to offer ideas to local government agencies: the Metropolitan Transportation Authority starting in 2018, and the Department of Environmental Protection since 2023. The programs have had a real impact — the MTA, for example, says it has saved millions of dollars by using a software to redesign bus routes that it first tested through the Transit Tech Lab.
Now, city leaders have agreed to make the Department of Buildings the latest guinea pig, according to details shared with Crain’s. The department hopes to get help from the tech sector as it prepares to take on a wide range of new responsibilities: enforcing the City of Yes rules that relaxed zoning distinctions, implementing the sweeping climate law Local Law 97, and doing new rounds of structural inspections in the wake of two building collapses last year.
All the new mandates have “put more demand on DOB staff without any real upgrade in the tools that they have to deal with these new challenges and expanded responsibilities,” said Kathryn Wylde, president of the Partnership, in an interview.
Buildings Commissioner James Oddo has repeatedly expressed a desire to bring his department into the 21st century technologically. The DOB approached the Partnership in 2022 to pitch the Tech Lab after Deputy Mayor for Operations Meera Joshi told Oddo about the existing MTA and DEP programs, said Stacey Matlen, senior vice president at the Partnership Fund for New York City — the investment fund overseeing the competition.
The inaugural Buildings Tech Lab will ask companies to apply by Sept. 20 with ideas that fall under two categories: process management, such as expediting building inspections and code reviews; and data utilization, using existing data to automate more work. Those categories were chosen after meetings with 30 DOB officials across eight bureaus that identified the agency’s biggest needs, Matlen said.
The handful of winners that emerge from the DOB competition will each be given an eight-week “proof of concept” phase where they will workshop their proposals with the department, followed by a yearlong pilot deployment on a larger scale. Companies get no payment from DOB or the Partnership Fund for participating, but a successful pilot gives them a shot at scaling up to a full-fledged contract — plus the industry credibility that comes with demonstrating a successful product in the country’s biggest city.
Among the issues that Buildings Tech Lab applicants may tackle is the new mandate handed down by the City Council last month that requires DOB to use predictive technology to identify buildings that are at risk of collapse.
Companies might also turn their attention to sidewalk sheds, as DOB recently began an in-depth study of its facade inspection rules as part of Mayor Eric Adams’ effort to take down unsightly scaffolding.
The companies accepted into the incubator will be early- and growth-stage.
Success stories from the existing Tech Labs include Knaq, which produces devices that monitor elevators, escalators and moving walkways. Since winning a 2020 Transit Tech Lab competition, Knaq has rapidly scaled up its partnership with the Port Authority of New York and New Jersey, which relies on the sensors to get real-time reports of outages instead of relying on complaints from riders.
When the Environmental Tech Lab launched last year under DEP, Knaq entered that contest as well. The company is now demonstrating how its sensors can be used to monitor the city's water-supply equipment remotely instead of deploying staff to check for outages, Matlen said.
The Buildings Department has a $212 million budget for the coming fiscal year under the city budget approved last week — less than the $219 million it was allocated at the start of last year. Oddo has at times expressed oncerns that his agency does not have the resources to take on many new responsibilities.
“The Buildings Tech Lab represents a significant step forward in our commitment to harnessing cutting-edge technology to enhance our regulatory functions,” Oddo said in a statement. “Public-private partnerships like this will help us connect with emerging tech companies, with an aim to improve agency efficiency,” Oddo said.
Since its inception in the 1990s, the Partnership Fund has invested about $200 million in local companies with an eye toward boosting New York City’s economy. Since 2010, it has run a FinTech Innovation Lab that supports early-stage financial services firms, a model that has been used as the basis for the public-sector competitions.
PEST CONTROL: The State Department of Health will conduct its second aerial larviciding of this season to marshes and other nonresidential areas the outer boroughs. The spraying will take place from Monday July 8 to Wednesday July 10 from 6 a.m. to 10 a.m., weather permitting. The department encourages New Yorkers to mosquito-proof their home and eliminate standing water.
CARDIAC SUITE: Maimonides Health opened a new cardiac suite at Maimonides Midwood Community Hospital on July 1. The program will be led by Dr. Jacob Shani, chair of cardiology and Dr. Robert Frankel, director of interventional cardiology. The center started to accept patients on June 25.
Dr. Robert Brenner came to Valley Health System in 2015 hoping that one day he could lead the system. This July, he reached his goal, assuming the role of chief executive officer of the health system, which includes a hospital, a home care service and a primary medical practice.
Brenner talked with Crain’s about his vision for the future and how to keep building on the system’s strong momentum following the opening of its new $868 million hospital in Paramus.
This interview was edited for length and clarity.
Tell us about some of Valley Health’s new initiatives and strategies for growth.
We can’t be everything to everybody, so we have created partnerships to complement what we have here and meet the needs of our community. For instance, we have many physicians from Mount Sinai to practice here within pediatric specialties. We also have a comprehensive care center in collaboration with them. In cardiovascular, we work with the Cleveland Clinic. In terms of behavioral health and meeting the needs of the community, we are doing that with Christian Health.
Then, we are on our path to being an academic medical center. We have our first residents who are now here on their second day, but we have a graduate medical education program that we brought to Valley in collaboration with Mount Sinai Icahn School of Medicine. We plan on building several programs.
Third, we have expanded our network in a very big way, adding or renovating 250,000 square feet this last year alone. We have a large medical arts building adjacent to the new hospital, which is state of the art, and we moved and consolidated different specialties together. For example, we’re opening a new cardiovascular service center, and in that, you’ll have the surgeons and the interventional cardiologists, and all of the different specialties so they can pop across the hallway and talk about patients that they need to collaborate on.
How will you expand access to care?
It’s not just an IT problem, it’s a complex issue. Let’s say we have few physicians in a particular specialty, if there’s huge demand, we need to make sure we are hiring more of those specialties. We need to make sure their schedules are open for booking, and that has helped us a lot with access, but we can take it further.
We need to further propagate mobile scheduling and get our patients to utilize that to gain access. We do have navigators in some specialties, but we may need to increase that.
The Valley Hospital’s patient revenue grew by nearly 9% from 2022 to 2023. Where does that growth stem from?
We have expanded our geography. I also believe that we have expanded the number of different specialties and care that we can deliver. In cardiovascular, we added surgeons, we added procedures you cannot get in other places. We hired an interventionist a couple of years ago who could do six procedures that no one else in New Jersey was doing. We were the third health system in the country to do pulsed-field ablation for atrial fibrillation.
Our volume since the move to the new hospital is expanding at exponential rates. Our volume is in general up 10%, and in some specialties is up much more. The emergency room in our Ridgewood campus was seeing under 200 patients [per day]. We’re now averaging 225 patients per day, and some days we’re up in the 260s. We have almost doubled the number of rooms in the emergency room, and it is busy.
What’s that increase from?
We’re pulling from other zip codes. We did get the “new and shiny” impact of the move. We were told we wouldn’t see the effect of the new hospital for eight to 12 months. But the second or third day out, we were seeing increased volume. We’re in a location more accessible to patients. We were nestled in Ridgewood, now we’re at the crossroads of several highways.
Valley Health has managed to avoid the trend of hospital consolidation. Why not merge with one of the bigger systems?
You would do a merger for several reasons. One is that you have issues on the financial and capital side. We don’t have that. And, if you look at past mergers, quality has not increased. The only thing that has consistently increased, with a merger, is the cost of care in that organization. So we have no reason to do it. Through our partnerships and our own health care, we’re able to accomplish what we need to.
On the flip side of that, have you thought about acquiring other facilities?
I don't think we’re in the market to acquire another health system. Those thoughts always go through strategic decision-making, but that’s not something we are considering at this time.
What do you want your legacy to be in this role?
This is my last stop in my profession. I want to make an impact on the organization, and I want this organization to grow. I want to see graduate medical education become a prominent part of our organization. I want to make sure we are stable with the [economic] headwinds, and I want to make sure that we grow the leadership in the organization so we can be known for our access and ability to navigate patients and high-quality, safe care.
A New York judge dismissed a lawsuit by a conservative group against city pension funds over their decision to sell billions of dollars in fossil-fuel investments, as socially conscious investing continues to spur political debate and litigation.
The group and three public sector employees lack legal standing to bring the lawsuit, state State Supreme Court Justice Andrea Masley said in an order made public Wednesday. That’s because they are members of a defined-benefit pension plan entitled to a fixed payment every month and therefore wouldn’t be harmed by the divestment decision in any case, the judge ruled.
“Plaintiffs here have not, and will not, suffer any monetary losses based upon defendants’ investment decisions,” the judge wrote in her order. The retired workers’ allegations about the plans’ potential inability to meet their future obligations are speculative, she found. Besides, she noted, the workers conceded that the city’s taxpayers were on the hook to meet pension obligations.
The dismissal is a rare bright spot for proponents of environmental and social investing. For more than two years, they have been subject to a barrage of attacks from Republican politicians because of their focus on climate change, workforce diversity and other issues.
“This court’s decision is a big win for common-sense responsible investing, for New York City’s municipal workers and retirees, and for the future of our city and our planet,” Comptroller Brad Lander said in a statement.
The plaintiffs in the case, including Americans for Fair Treatment, sued three city retirement plans last year over their decision to sell about $4 billion in fossil fuel investments, calling it “a misguided and ineffectual gesture to address climate change.” They were represented by Eugene Scalia, who served as labor secretary under Donald Trump.
Scalia didn’t immediately respond to messages seeking comment.
The pension funds asked the court to dismiss the suit.
Lyft, which operates the popular Citi Bike program, said it will raise fares for e-bike rentals in New York City by 20%, blaming higher-than-expected operating costs.
On July 10, e-bike fees for those with an annual Citi Bike or Lyft Pink All Access membership will increase to $0.24 per minute from the current $0.20, according to an announcement on Citi Bike’s website. Non-members will see fees raised to $0.36 per minute from $0.30.
“Higher-than-anticipated battery swapping, insurance and vehicle expenses have made e-bike fleet operations more costly than planned,” Citi Bike said in the statement. It also said it’s working with the city’s Department of Transportation and Con Edison to pilot charging stations, which would reduce the need for van-based battery swapping. E-bike prices for rides in New Jersey remain unchanged.
Lyft has seen continuing growth in demand for e-bike rides, which it said now account for two-thirds of all Citi Bike trips. But it’s also been looking since last summer for a strategic partner that can invest in its bikes and scooter rental infrastructure, as Chief Executive Officer David Risher works to turn around the company’s core ridesharing business.
Citi Bike’s hefty maintenance costs were the subject of a report from New York City Comptroller Brad Lander last November, in which he called for an overhaul of the bike contract to “ensure more reliable and equitable service.” The report found “significant operational shortcomings” including unusable stations, longer periods of station unavailability and more broken bikes since Lyft acquired the service in 2018.
Leases
Famed Irish pub reopening in Durst building
Address: 114 W. 47th St., Manhattan
Landlord: The Durst Organization
Tenant: Langan's
Lease size: 4,000 square feet
Lease length: 16 years
Asset type: Retail
Sales
Long Island firm picks up 79-unit Williamsbridge project
Address: 1039 E. Gun Hill Rd., Bronx
Seller: Aleksander Lakaj
Buyer: 33 Equities
Sale price: Approx. $27 million
Asset type: Multifamily
Read more about the deal here.
Financings
Hudson, St. Nicks land financing for phase two of affordable housing project
Address: 89 Maspeth Ave., Brooklyn
Owner: The Hudson Cos. and St. Nicks Alliance
Lenders: The Housing Development Corp., the Department of Housing Preservation and Development, the New York State Research and Development Authority, the New York City Energy Efficiency Corp., Capital One Bank and the Bank of New York
Loan amount: $235 million
Asset type: Multifamily
Gov. Kathy Hochul indicated Tuesday that she is tepidly open to the idea of reducing the $15 base fee for congestion pricing to advance the tolls, in response to urging from some state lawmakers that the governor consider lower fees for drivers as a way to move the program forward.
“Right now, as I’ve said, $15 on top of everybody's expenses for groceries and everything is going to cost more, it's just not the right time,” Hochul told reporters during a Tuesday news conference. “And yes, conversations are very much underway.”
Behind closed doors some state senators have pushed Hochul to advance congestion pricing but with reduced tolls to make the program potentially more palatable to the governor. Hochul has repeatedly said her decision to indefinitely pause congestion pricing is fueled by cost of living concerns for New Yorkers.
“I have urged the governor to mend it, not end it,” said State Sen. Brad Hoylman-Sigal in a Monday interview. Hoylman-Sigal's Manhattan district is mostly within the would-be congestion pricing zone. He added that it’s crucial for the tolls — regardless of their price structure — to advance sooner rather than later in the event that former President Donald Trump is elected in November.
“With the specter of a Republican in the White House it’s important that this program be put into place before January of next year otherwise it could be scrapped,” said Hoylman-Sigal. “Trump has already pledged to.”
For that to happen the state Legislature would need to return to Albany for a special session ahead of January. State law legally mandates that congestion pricing, which would reduce vehicle traffic on Manhattan’s busiest streets and improve the region’s air quality, generate roughly $1 billion in annual revenue, which the Metropolitan Transportation Authority would then bond to $15 billion for mass transit upgrades. To lower the tolls, lawmakers would have to amend the 2019 law and then, to make up the revenue difference, approve supplemental funds.
State Sen. Liz Krueger, the chair of the Senate Finance Committee, said Hochul, in recent conversations, had not ruled out the idea of lowering the targeted toll revenue to shrink the fees.
“If she can come up with an alternative plan that [achieves all the benefits of congestion pricing], and it involves some reduction in tolls, I am open to reviewing,” Krueger said Wednesday in an interview. “She has not submitted any proposal to me.”
Transportation advocates have widely panned amending the law.
Lisa Daglian, executive director of the Permanent Citizens Advisory Committee to the MTA, described the possibility as “a terrible idea.” Any change to the tolls would require fresh review and approval by the MTA’s board and the Federal Highway Administration. That process could stretch into several months.
“There are a lot of pitfalls,” said Daglian. “If you move the pieces on the board too much you have to reopen the federal process and remodel everything. And so it's not just as simple as saying, oh, I'd like to do this or I'd like to do that, there are real effects to consider.”
A small firm has completed the biggest deal in the Bronx for 2024 by a wide margin.
33 Equities, a four-year-old company based in Long Island, has snapped up 1039 E. Gun Hill Rd., a new 7-story, 79-unit rental in the Williamsbridge neighborhood, for about $27 million, property records show.
The seller in the deal, which closed June 24 and appeared in the city register Tuesday, was local developer Aleksander Lakaj, according to the deed. Israel Discount Bank of New York provided 33 Equities with $20 million in acquisition financing.
Based on a Crain’s analysis of publicly available deeds, the developer’s purchase represents the largest commercial transaction in the Bronx so far this year.
Indeed, only six sales since the start of 2024 have been for $10 million or more. The largest of that pack was a deal for 975 Walton Ave., a prewar rental complex near Yankee Stadium that closed at $18 million, according to the data.
Details about layouts and finishes at 1039 Gun Hill, which is between Laconia and Paulding avenues, are scarce. No apartments appear to have hit the market at the property, which received a certificate of occupancy in May, according to Department of Buildings records.
An email sent to 33 Equities’ co-founder Tucker Shane was not returned by press time. Lakaj, who appears also to have a general contractor business, declined to comment when reached by phone.
But records suggest that 33 Equities has been involved in the development of the site from nearly the beginning. The firm, which is based in Great Neck, went into contract on the site in September 2022, about nine months after Lakaj bought the brick industrial building that once stood on the site for $4.2 million, according to the register.
Northeast Community Bank of White Plains provided $15 million in construction financing, records show.
Though upstart and low-profile, 33 Equities, which also counts Zach Hering among its two principals, has been busy acquiring mid-sized residential properties across New York.
In 2021, it picked up 48 Bedford St., a 10-unit rental building in the West Village, for $6.5 million, according to the register. The firm followed that deal the next year with the purchase of 12 unsold co-op units at 203 Spring St., a prewar walk-up at Sullivan Street in SoHo, for $11.8 million.
The company is also already familiar with the Bronx. In 2022 33 Equities bought 1988 Anthony Ave., an 8-story, 61-unit rental rental development in Tremont, for $19.8 million.
Investment sales have been notably sluggish in New York. The first quarter of 2024, which experienced about $2.9 billion in deals across 392 transactions, was the second-slowest since 2015. Large residential projects have also been rare. In March, for instance, developers filed plans for just three projects with more than 100 units, all in Brooklyn, according to data from the trade group the Real Estate Board of New York.
But incentive measures in the state budget passed earlier this year, including the property tax abatement program 485-x, are expected to help juice multifamily production.
New York will play an outsize role in national politics this fall, but the state’s Democratic officials have been largely quiet about Joe Biden’s ability to stay in the presidential race following his disastrous debate performance.
Senate majority leader Chuck Schumer has said little publicly except for a lone social media post boosting Biden the night of the June 27 debate — but he has reportedly expressed private openness to a nominee other than Biden. House minority leader Hakeem Jeffries was notably restrained the day after the debate, saying he would “reserve comment” until he heard from the president. (Biden finally did call Jeffries on Tuesday, the New York Times reported).
Silence or muted support for Biden has also predominated among the half-dozen Democrats running in New York’s swing House districts, Politico reported Tuesday. The exception was upstate Democratic candidate Josh Riley, who said in a statement last week, “Most of the voters I talk to wish they had different options, and they want new leadership.”
“They’re not wrong,” Riley added. As of Wednesday afternoon, Texas Congressman Lloyd Doggett was the only elected Democrat in Congress to call on Biden to withdraw from the race.
Many in the political world are already checked out for the July 4 holiday, which can explain some of the silence. Another factor is that President Biden has offered little public comment since his disquieting debate performance, leaving down-ballot officials unsure how to follow his lead even as they dread the prospect of another Donald Trump presidency.
“Some of the reason we haven’t heard so much right now is we haven’t heard from Biden himself,” said Lupe Todd-Medina, a Democratic political consultant based in the city.
Gov. Kathy Hochul offered more full-throated support, calling Biden a “good, decent man.” She labeled Trump a “convict” who “guarantees us more corruption and chaos” in an appearance on MSNBC on Sunday. Sen. Kirsten GIllibrand, appearing alongside Biden in Manhattan the day after the debate, embraced the president and exclaimed to onlookers, “He’s the best! He’s a fighter!”
Jay Jacobs, chair of the New York Democratic Committee, has defended Biden while also acknowledging widespread concerns among rank-and-file voters, telling multiple outlets in recent days that voters should “sit back” and “wait and see how this shakes out.” Jacobs did not immediately respond to a request for comment on Wednesday.
Biden beat Trump in New York by 23 points in 2020, but a Siena College poll taken in mid-June found him leading Trump by just eight points among registered voters of both parties. Biden’s favorability rating was 42% compared to 53% unfavorable, his worst-ever showing in the state.
Bloomingdale’s is paying 40% above market to lease space for its outlet store at 201 W. 72nd St., according to a bond-rating agency report.
The steep rent may be worthwhile thanks to the outlet store’s prime location at a busy Broadway intersection next to the subway. Trader Joe’s, Fairway, and other discount retailers are nearby. It isn’t clear how much the Bloomingdale’s store generates in sales but if it’s less than $20 million in 2028, the lease can be terminated before it’s scheduled to expire in 2032, KBRA said in a report last month.
The rent of $172 per square foot, comparable to what some retailers pay for posh Fifth Avenue storefronts, is paid to a venture jointly controlled by Peter Malkin, former chairman of the firm that owns the Empire State Building, and Stahl Organization, which owns 277 Park Ave. and Apple Bank, among other properties.
Bloomingdale’s owner, Macy’s, has been closing underperforming stores for several years and in February said it would close 50 this year and 150 by 2027. At the same time, the operator plans to open around 15 Bloomingdale’s the Outlet or Bloomie’s locations through 2026.
The Upper West Side outlet store measures 25,000 square feet and is located at the base of a 25-story luxury condominium. Base rent is $4 million a year. The location was Bloomingdale’s first outlet store in an urban area when it opened about a decade ago.
“This is a great opportunity to expand the reach of our brand to value-conscious customers as well as better serve the expansive needs of our core West Side customers,” an official said at the time.
An email to Macy’s wasn’t returned.
In February, New York Governor Kathy Hochul proposed sweeping artificial intelligence regulatory measures intended to protect against untrustworthy and fraudulent uses of AI. Then in May, the state of New York committed $275 million to launch a state-of-the-art AI computing center at the University at Buffalo. This center aims to promote responsible research and development, create jobs, and advance AI for the public good.
While these statewide initiatives are commendable, there is still widespread confusion around proper implementation of AI in business in New York. For instance, according to BDO’s CFO Outlook Survey, across all New York CFOs surveyed, 1 in 3 have not yet formalized a policy for generative AI usage. Looking specifically at New York technology CFOs, a smaller subset of the data collected, 62% say their employees do not have a clear understanding of policies and processes related to data collection and processing.
That’s because embracing AI in business is more than just new tools or grappling with evolving legislation. It’s a mindset shift. And in an era where AI is rapidly becoming integral to business operations, those who take a proactive and thoughtful approach to generative AI can gain market share now and reap success in the future.
Privacy protocols and fraud prevention
AI is an invaluable tool for decision-making, brainstorming, automating processes and improving accuracy. However, it also presents significant challenges. Bad actors can exploit AI to fabricate identities and documents with unprecedented credibility and realism.
To mitigate AI risks, companies must proactively establish robust technical and physical safeguards to protect personal information, prevent data leaks, and ensure unauthorized access is averted. And while New York technology CFOs are ahead of most other technology CFOs across the country with privacy protection (85% of New York technology CFOs plan to deploy privacy technologies to combat future breaches, vs. 42% of technology CFOs nationally), there is a rising threat of data breaches as reliance on AI to organize personal information increases. It is key for fraud prevention and risk management departments to work closely with data protection professionals as it can reduce the potential for privacy breaches and identity theft.
It is also important for businesses to do more than improve their company’s data privacy positioning; they must also find ways to communicate their policies to customers. Transparent data privacy policies and the documentation to back them up can help companies build trust in a world where it’s quickly disappearing.
Strengthening AI systems through effective data management
Data is the building block of AI systems. Managing that data with tactics, such as data mapping and inventory management, is essential to building resilience against AI's risks. BDO’s survey shows that only 23% of the smaller sampling of New York technology companies surveyed have already begun deploying these tactics, compared to 51% of technology CFOs across the country. Building resilience against AI risks requires an effective data governance strategy that prioritizes data management, quality control and collaboration across business functions.
By digitizing as much data as possible and applying an agreed-upon methodology, organizations can reduce disruptions caused by new or dissonant data, be it from a business acquisition or an enterprise resource planning (ERP) system implementation. Establishing master data management provides uniform processes for effective data analysis, reduces manual reconciliations, and enables data to be used for multiple purposes, accelerating business growth.
The road ahead: balancing innovation with regulation
As AI technology continues to evolve, so will the regulatory landscape. New York’s proactive measures in regulating AI and investing in AI infrastructure demonstrate a commitment to fostering a secure and innovative technology environment. However, businesses cannot afford to wait for statewide policies to catch up with the rapid pace of AI advancements.
To remain competitive and innovative, New York businesses must proactively address AI risks and establish clear guidelines for AI use. Those that embrace a data-driven approach to AI risk management and develop robust AI policies will reduce vulnerabilities and position themselves as pioneers in the AI landscape. By taking these steps, companies can ensure they are not only compliant with future regulations, but also leaders in ethical AI use.
Russell Diller is an assurance principal with BDO, an international network of public accountants and tax advisors.
President Joe Biden this week plans to meet with Democratic governors and lawmakers, travel to two battleground states and sit for his first televised interview since his disastrous debate performance in an attempt to reassure anxious supporters.
Biden’s meeting Wednesday with governors is expected to be held virtually, with many joining via video call, according to people familiar with the matter. Gov. Kathy Hochul is expected to be among the attendees. ABC News anchor George Stephanopoulos will interview Biden on Friday.
The peril Biden faces as he presses on with his reelection bid heightened Tuesday, when Lloyd Doggett of Texas became the first sitting House Democrat to call on him to exit the race and new polls showed the president’s support fading. That underscored the need for Biden to do more to close his party’s ranks.
Biden plans to travel on Friday to Wisconsin and to Philadelphia on Sunday then hold a press conference next week at the NATO summit in Washington, White House Press Secretary Karine Jean-Pierre announced Tuesday. The president is also expected to speak with leaders on Capitol Hill, she said.
“We’re going to turn the page. We’re going to get out there across the country. Americans are going to see him for themselves,” Jean-Pierre told reporters.
The effort is meant to counter brewing discontent among leading Democratic donors, aides and elected officials over Biden’s debate performance, which has deepened their fears that former President Donald Trump will return to the White House.
Three quarters of voters said Democrats would have a better chance of retaining control of the White House if someone else was atop the ticket, according to a CNN poll released Tuesday. Biden polled worse in head-to-head match ups than other prominent Democrats — including governors like California’s Gavin Newsom and Michigan’s Gretchen Whitmer — who are expected to be on Wednesday’s call. Prominent Democrats have begun to wonder aloud about Biden’s mental state.
“It is a legitimate question to say, is this an episode or is it a condition?” former House Speaker Nancy Pelosi said Tuesday on MSNBC. “So when people ask that question it is legitimate, of both candidates.”
The governors meeting, reported earlier by CBS News, is a chance for Biden to persuade them he should remain the party’s standard bearer as some privately harbor concerns about Biden’s viability. Whitmer said Monday she stands behind the president, pushing back against suggestions there were tensions between her team and Biden’s.
Despite the fears about Biden’s candidacy in many corners of the Democratic Party, no top lawmakers, governors and Cabinet officials have publicly said the president should end his campaign. Newsom an Pritzker have also issued statements that are supportive of Biden.
'Too much is at stake'
News of the meeting with Biden came a day after Democratic governors held their own call, during which some expressed concern about the president and said they wanted to speak to him, CNN reported. Biden’s team was in touch with the governors and their staffs about Monday’s meeting, according to a Democratic official.
Vice President Kamala Harris also plans to have lunch with Biden on Wednesday, according to a White House official. The two have shared midday meals on a semi-regular basis but the sit-down comes at a time when she has also been mentioned as a possible stand-in for Biden.
Biden, however, received unwelcome news on Tuesday when Doggett released his statement saying Democrats should not “assume that what could not be turned around in a year, what was not turned around in the debate, can be turned around now.”
“Too much is at stake to risk a Trump victory,” Doggett said.
The president and his team have sought to shift the public’s focus away from his mental fitness and onto Trump’s conduct following the Supreme Court’s decision that the former president is partially immune from criminal prosecution. That argument represents Biden’s narrow path to victory, but thus far his case has fallen flat with voters.
The president in a Monday speech at the White House called on voters to “render a judgment” on whether the presumptive Republican nominee’s involvement in his supporters’ Jan. 6, 2021 assault on the U.S. Capitol makes him “unfit for public office.”
Blame game
Biden’s team also touted his $127 million June fundraising haul to counter post-debate angst. That’s $15 million more than Trump raised last month, though the Republican now has a cash advantage. Campaign officials, including chairwoman Jennifer O’Malley Dillon, on Monday held a question-and-answer session with donors aimed at reassuring them that Biden has a path to victory, according to people familiar with the call.
After acknowledging the debate went poorly, Biden’s campaign went on the offensive against party figures and media personalities who have called on him to drop out of the 2024 race, labeling them disloyal “bed wetters.”
Members of Biden’s family and donors have also blamed the president’s close-knit circle of advisers for last Thursday’s debacle against Trump. But Biden’s apparent refusal to even consider a campaign shake up has rattled outside Democrats who are calling for a course correction.
The Democratic National Committee is considering formally nominating Biden as soon as mid-July, according to people familiar with the matter. The move is intended to ensure that Biden makes the ballot in all 50 states this November, but it could also help stamp out talk about replacing him. A potential date for Biden’s nomination is July 21 when a key party panel is scheduled to meet virtually, the people said.
Democrats already planned to nominate Biden before the party’s convention in August to meet a ballot certification deadline in Ohio. But the timing is fortuitous in that it allows the party to officially close ranks around the president within the next three weeks.
Moderna Inc. secured nearly $200 million from the U.S. government to speed development of an mRNA vaccine for pandemic influenza as a dangerous strain of bird flu sweeps through the nation’s dairy farms, fueling concern about a budding health crisis.
The Department of Health and Human Services awarded Moderna $176 million to help pay for late-stage clinical trials that will start in 2025, Dawn O’Connell, assistant secretary for preparedness and response, said in an exclusive interview. The vaccine will be tailored so it can target several influenza strains with pandemic potential, including the family of bird flu viruses currently in circulation.
Already one such virus, called H5N1, was detected in 136 cattle herds across 12 states and has infected three farmworkers this year, according to the Centers for Disease Control and Prevention. The nation’s top health officials maintain the risk of H5N1 to the general public remains low. No human-to-human transmission has been identified and vaccination isn’t currently recommended, O’Connell said.
“Our job is to be prepared should that change,” she said. “If you had asked any expert in 2018 what they expected to be the next pandemic, they would have said a highly virulent flu.”
While the focus of the government award is dangerous influenza strains, that could shift should a different pandemic threat emerge, she said.
The benefit of mRNA technology, which was the foundation of Covid-19 vaccines from Moderna and Pfizer Inc., is that it can be quickly adapted if the virus mutates. That creates a potential advantage over traditional vaccines, many of which are grown in chicken eggs.
Results from Moderna’s early studies of the bird flu shot are expected in the next few weeks. The U.S. government contract is a win for the company, which is looking for new sources of revenue and trying to shake its reliance on the fading market for Covid vaccines.
O’Connell said the U.S. wants to help Moderna generate the data it would need to get clearance from US regulators. But the contract, which was made through the Biomedical Advanced Research and Development Authority, goes much further, she said. It includes options for the US to purchase vaccine supplies, which would be produced domestically and require additional funding.
The U.S. has already reached terms with the biotechnology company to ensure “fair pricing” for the American taxpayer, O’Connell said, though she declined to describe the specific details of the contract.
Moderna likely isn’t the only pharmaceutical company that will reach a contract to develop mRNA vaccines for pandemic flu. The U.S. anticipates making additional announcements about other awards, she said. Asked about negotiations with Pfizer, O’Connell declined to comment.
Traditional pandemic flu vaccines are further along in development and production. The U.S. has two such vaccines candidates tailored to the current H5N1 strain, and is testing them with GSK Plc, Sanofi SA and CSL Seqirus. There are hundreds of thousands of pre-filled syringes already on hand, and the US has tasked CSL with filling-and-finishing another 4.8 million vaccine doses.
O’Connell said that those doses will “begin to roll off the production lines in mid-July.”
Mayor Eric Adams announced a deal on a $112 billion budget with the City Council on Friday, reversing a small but notable fraction of his unpopular cuts as he looks toward a difficult re-election bid next year.
The spending plan for Fiscal Year 2025 also makes some new investments at the urging of lawmakers, including $2 billion for housing. City Hall’s willingness to add spending marks a major shift from last year, when Adams’ dire warnings about future-year deficits and the costs of the migrant crisis led him to impose some unusual mid-year cuts across city agencies.
“We’re delivering a budget that invests in the future of our city and the working people who live here,” the mayor said at City Hall Friday afternoon, moments after a symbolic handshake with Council Speaker Adrienne Adams. The council pushed successfully to undo $350 million of the $7 billion in cuts the mayor had ordered — including controversial reductions like the $58 million from public libraries that would have ended weekend service, and $53 million from cultural groups like museums and botanic gardens.
Early childhood programs like pre-K and 3-K will get $100 million, short of what some advocates had asked for, as the city dips into its own funds to shore up expiring federal money that had helped pay for those programs. Council Speaker Adrienne Adams warned that the city would need help from the state government to sustain that funding in the future.
All the restorations total just $350 million, leaving in place the vast majority of the mayor’s $7 billion cuts. The not-yet-finalized $112.4 billion deal is a modest increase from the mayor’s previous $111.6 billion proposal from April.
Still, Speaker Adams sounded triumphant, saying the council had won funding for all of its biggest priorities. The deal for libraries and cultural institutions also includes recurring, or “baselined” funding into the future, potentially sparing them from the annual budget battles they have seen in recent years.
“It is imperative for our city's future that the budget process moves away from restoring and towards strengthening and building,” Speaker Adams said on Friday, in a modest dig at the mayor’s hawkish approach. She and the mayor grinned as they shook hands and displayed a model airplane, a reference to the mayor’s frequent pledge that they would “land the plane” by passing the budget on time.
The City Council will pass the budget on Sunday, hours before the official deadline, after weeks of negotiations that stretched down to the wire. Lawmakers have argued for months that the mayor was relying on overly pessimistic tax-revenue forecasts to justify the cuts, noting that a range of budget watchdogs agreed that the city would have more money in the coming years than City Hall had projected.
By April, the mayor did release a rosier forecast that he said made it possible to cancel additional cuts and undo previous reductions that would have affected police, pre-schools and trash-can pickups. But Adams is no doubt mindful of the political hits he has taken: A poll released this week by Slingshot Strategies showed that a majority of registered Democrats opposed his handling of the budget, while only about one-quarter approved.
The same poll put Adams’ job approval at just 36%, the latest in a string of dismal results for the mayor that have emboldened State Sen. Zellnor Myrie and former comptroller Scott Stringer to both announce they plan to challenge him in next year’s Democratic primary.
New funding for housing
The new investment in housing came after a campaign by progressive lawmakers and advocates, who warned that rising construction costs would cause production to drop next year — undercutting one of Mayor Adams’ key priorities — unless funding were increased. That campaign had focused on funding programs that preserve existing rent-stabilized units, but the agreed-upon budget deal would instead mostly fund programs that finance new construction.
The deal includes $470 million over two years for new mixed-income housing and $272 million for extremely low and low-income projects, part of a total $1.3 billion commitment to the Housing Preservation and Development department, according to details shared with Crain’s. Another $700 million will go to the New York City Housing Authority, which has an enormous funding backlog.
Rachel Fee, executive director of the New York Housing Conference, said she agreed with the decision to focus on capital programs that could fund shovel-ready development, given that city housing officials have admitted there are more than 700 affordable projects sitting in the pipeline awaiting financing.
“Because we have that huge backlog, it makes sense to advance the projects that are ready to go,” Fee said in an interview. “We’re absolutely thrilled, and we do see this as a historic investment at a time when it really couldn’t be needed anymore.”
Other cuts still in place
Only a high-level view of the budget deal was available by Friday afternoon, leaving the funding levels for most city programs unclear. But some early criticism came from city Comptroller Brad Lander — who may run against the mayor next year — who said the plan failed to fully restore previous cuts to early childhood education, the City University of New York, and rehabilitation programs for Rikers Island detainees.
“A budget dance of unnecessary cuts and last-minute restorations, with little focus on real long-term savings and priorities, fails to set New York City on firm fiscal footing nor prioritizes the most critical investments for our future,” Lander said.
About $2 billion of the mayor’s previous cuts came from efforts to reduce spending on migrants through policies like time limits on shelter stays, and the council made no major push to undo those rules.
Adams announced plans last summer to impose 15% across-the-board budget cuts to most city agencies, weeks after he had said that the city expected to spend $12 billion over two years caring for asylum-seekers. But he began to reverse himself starting in January, when he made the unusual move of rolling back his own cuts before he had even begun negotiations with the council on the next year’s budget.
The back-and-forth fueled claims from critics that Adams had been negotiating against himself, potentially in an unsuccessful bid to win more federal aid for the migrant crisis. City Hall officials rejected those arguments, saying they were only able to back off more severe cuts thanks to their own belt-tightening.
Here are the subway disruptions, road closures and other commuting changes you should be aware of as you get around the city this week.
Subways * No G trains between Nassau Avenue in Brooklyn and Court Square in Queens beginning Friday, June 28, at 9:45 p.m. through Friday, July 5, at 9:45 p.m. * On Thursday, July 4, the subway runs on a Saturday schedule.
Commuter rail* On Wednesday, July 3, Metro-North Railroad’s Harlem, Hudson and New Haven lines run trains on a Friday schedule with extra early-afternoon service. * The Hudson, Harlem and New Haven Lines run on a Sunday schedule, while the Port Jervis and Pascack Valley lines run on a weekend schedule on Thursday, July 4. * The Long Island Rail Road runs on weekend schedules on Thursday, July 4.
Roads and bridges
Air travelers be warned: Construction as part of the $19 billion redevelopment of John F. Kennedy International Airport will cause headaches for drivers and cab riders. Expect delays due to detours or closures of roads around the airport. State officials are encouraging travelers to utilize mass transit. As of Monday, July 1, through Monday, Sept. 2, AirTrain JFK single ride fares will be reduced by 50% to $4.25 — with 20-minute trains to the Jamaica AirTrain JFK station from Grand Central Terminal or Penn Station. For drivers, the Port Authority encourages the use of its free drop-off, pickup and waiting lot at the Lefferts Boulevard AirTrain JFK station, where passengers can connect to the free AirTrain for an eight-minute ride to the airport’s terminals.
The following streets will be closed for the Macy’s 4th of July Annual Fireworks Celebration on Thursday, July 4:
- Joe DiMaggio Highway
- West Side Highway
- West Street
- 12th Avenue
- 11th Avenue between Spring Street and West 46th Street
- Clarkson Street between West Street and Greenwich Street
- Christopher Street between West Street and Greenwich Street
- Charles Street between West Street and Washington Street
- West 11th Street between West Street and Greenwich Street
- West 12th Street between West Street and Greenwich Street
- West 13th Street between West Street/11th Avenue and Washington Street
- West 15th Street between West Street/11th Avenue and 10th Avenue
- West 17th Street between West Street/11th Avenue and 10th Avenue
- West 20th Street between West Street/11th Avenue and 10th Avenue
- West 22nd Street between West Street/12th Avenue and 10th Avenue
- West 24th Street between West Street/12th Avenue and 11th Avenue
- West 26th Street between West Street/12th Avenue and 11th Avenue
- West 29th Street between West Street/12th Avenue and 10th Avenue
- West 34th Street between West Street/12th Avenue and 11th Avenue
- West 40th Street between West Street/12th Avenue and 10th Avenue
- West 41st Street between West Street/12th Avenue and 11th Avenue
- West 44th Street between West Street/12th Avenue and 11th Avenue
- 11th Avenue between West 22nd Street and West 46th Street
The following streets will be closed for the Coney Island 4th of July Fireworks on Thursday, July 4:
- The Area bounded by the Boardwalk on the South
- Surf Avenue on the North
- West 10th Street on the East
- West 21st Street on the West
- Stillwell Avenue between Mermaid Avenue and Boardwalk
The following streets will be closed for the Nathan’s Famous July 4th Hotdog Eating Contest on Thursday, July 4:
- Stillwell Avenue between Surf Avenue and Bowery Street
- Bowery Street between Stillwell Avenue and West 15th Street
- Surf Avenue between West 15th Street and West 12th Street
- West 15th Street and West 12th Street West 15th Street between Surf Avenue and Bowery Street
The following streets will be closed for the Travis 4th Of July Parade on Thursday, July 4 in Staten Island:
- At Showplace Center (East Service Road), cross Victory Boulevard to Glen Street Glen Street between Melvin and Cannon Avenues
- Cannon Avenue between Glen Street and Victoria Boulevard
- Victory Blvd between Cannon and Melvin Avenues
- Melvin Avenue between Glen Street and Victory Boulevard
Read recent transportation stories:
To see the stress mounting again on Wall Street’s junior bankers, just look a half-rung higher, at staffers.
Not staff, as in employees, but staffers, the unheralded deputy managers who dole out assignments to trainees. When investment bankers or clients want something done, staffers find underlings for the drudgery. That’s getting trickier as banks exit a slump in deals with thinner headcount and big ambitions for landing new mandates.
Trainees and staffers alike are now feeling the strain.
A junior banker at JPMorgan Chase and another at UBS Group, for example, privately said they’re inflating their weekly hours in internal tracking systems so bosses don’t make them give up their last bits of free time. At Bank of America, two trainees said they’re instead understating to avoid breaching 100-hour limits, dubbed “tripping the system,” which can prompt a call from HR and stir up trouble for managers.
When banks do run short of junior bankers to crank out analyses and pitch decks, it falls on staffers to tell the bosses tough luck. A Citigroup staffer recently recalled how nerve-wracking that was her first time.
After emailing a managing director that everyone was too busy, she cried and got physically ill. When the response later arrived — “I am so disappointed in you” — she stared at her screen in angst. She later left.
Interviews with current and recently departed junior bankers and their managers show that 100-hour work weeks, which never went away, are once again becoming more common as investment banks chase a modest but growing flow of deals. The employees asked not to be identified to protect their careers.
The swelling workloads are testing promises banks made just a few years ago to give trainees breaks and safeguard their health. And, for young bankers, it’s bringing old frustrations back to the fore.
The death on May 2 of Bank of America associate Leo Lukenas from a heart attack — just days after the former Green Beret finished work on a $2 billion deal — triggered an outpouring of those feelings on online message boards. Though authorities attributed Lukenas’ death to natural causes, anonymous posters vented about being asked to do too much and called for a walkout, which never materialized.
Bank of America has said its executives take junior bankers’ health seriously and that the firm frequently reviews policies to ensure they’re protected. As for how they log time, the firm said, “our practice is clear and we expect employees to accurately record their hours.”
Spokespeople for JPMorgan, UBS and Citigroup declined to comment.
Long hours have always been a facet of Wall Street’s training programs. But unlike the tsunami of activity junior bankers handled during the pandemic, the recent sense in the lower rungs is that much of the work is on spec, as bosses try to position their firms for an upswing, especially once interest rates fall.
With many desks just starting to see revenue increase, trainees have little leverage to demand better conditions. Peloton exercise bikes that some firms offered a few years ago are now gathering dust because, as a young banker at one boutique firm put it, nobody has time to use them anymore.
“The culture in banking isn’t keeping up with the times and needs of junior bankers,” said Stephan Meier a professor at Columbia Business School. Instead, supervisors keep making the mistake of viewing trainees as resources to be used or wasted, he said.
“Either firms squeeze out as much as possible of their junior bankers, and that’s good for the business, or if they don’t, it hurts the performance of the organization,” Meier said. “That’s the wrong mindset.”
Chest pains
Firms have bolstered safeguards and perks in recent years, such as ensuring some Saturdays off or providing free fitness classes. Yet workloads haven’t been curtailed to allow for it, employees said in interviews. That leaves them to argue with staffers or, worse, anger the more powerful bosses they need to impress.
One junior banker who left Lazard late last year said she couldn’t bring herself to seek help, even as her health deteriorated. She felt pressure in her chest while working, Googled “heart attack symptoms” and contacted a medical hotline, which urged her to see a doctor. But she stayed at her desk, worried that if it were a false alarm, bosses would view a trip to a clinic as a poor excuse for blowing deadlines. Feeling worse months later, she quit to start a new career.
A junior banker at another big bank said he also kept working while experiencing chest pain after gulping an energy drink to finish a 100-hour week. He thought about seeing a doctor, but everyone else on his team was pulling the same hours, and he didn’t want to stand out as the one who couldn’t hack it.
A May survey by the social media platform Overheard on Wall Street found junior bankers are putting in an average of about 80 hours a week — equating to more than 11 hours a day including weekends — and sleeping about five hours a night. Yet some of the roughly 200 participants claimed to have notched 140-hour weeks, leaving only four hours a day for sleeping and other necessities.
Asked to score their mental and physical health on a scale of 1 to 10, the average responses were 2 and 3, respectively, according to a copy of the results seen by Bloomberg.
A question about the pressure on young bankers even made its way into JPMorgan’s annual investor day last month. Jennifer Piepszak, co-head of commercial and investment banking, responded that nothing is more important than the well-being of employees and that managers need to ensure that.
“We can’t just sit in our offices and go through business reviews,” she said. “We have to be out in the field and every one of us are, so that we have a sense of where the pressure might be mounting, and we need to give people the resources to be able to cope.”
Staffer conflicts
At many banks, the role of staffer has existed for decades. They appear in Michael Lewis’ Liar’s Poker, portraying life at Salomon Brothers in the high-flying 1980s, and in John Rolfe and Peter Troob’s Monkey Business, chronicling young bankers at Donaldson, Lufkin & Jenrette during the dot-com bubble.
Though many staffers are mere vice presidents — near the bottom of the management tree — banks typically ask them to ensure higher-ups don’t demand too much from new arrivals. Indeed, a staffer at a bulge-bracket bank said she requested the job so she could help protect junior bankers after her own training at boutique Houlihan Lokey was so rigorous that she began bringing a sleeping bag to the office.
Still, several junior bankers interviewed by Bloomberg described their staffers as clearly conflicted — more eager to impress rainmakers and climb the ladder than to push back.
A Citigroup employee said that he kept telling his staffer that his weekly hours were surpassing the 100 that the bank’s software would let him log — only to be told that everyone was stretched and that the deals still needed to get done.
‘Selling your soul’
Strolling around Manhattan, it’s easy to find signs of Wall Street’s intense treatment of trainees.A young man was seen doing push-ups on Park Avenue’s sidewalk Thursday, sweating through his dress clothes with the sun overhead. Asked what was happening, he said he was being punished by his boss for screwing up a pitch deck.
For those who stick with it, the goal remains a high-paying career. At investment banks, such lucre may not be quite as abundant as when formal training programs were set up as a gateway into private partnerships. But the experience is still valuable, with many junior bankers soon defecting to private equity or money management.
“Going into banking, you are making the conscious decision of giving up your lifestyle,” said Hamilton Lin, co-founder of Wall Street Training & Advisory. “You are selling your soul to the devil, but it’s a fair trade.”
Manhattan’s original trophy condominium, Olympic Tower, had its mortgage downgraded this week by KBRA. The bond-rating firm cited weak retail leasing activity inside the luxurious Fifth Avenue building’s atrium.
Developed in 1974 by Aristotle Onassis and Arthur Cohen, the 525,000 square-foot tower at East 51st Street was the first in the city marketed to extremely wealthy foreign buyers. Apartments had no numbers on the doors and globetrotting residents tended to treat them as a pied-a-terre, leading Curbed two years ago to call the 51-floor residential and office building “an extremely well-manicured ghost town.” In order to build taller, developers agreed to open the lobby to the public and invited retailers to set up shop inside, or in the beaux arts mansions between Olympic Tower and Cartier’s flagship store at East 52nd Street.
Now, some retailers are leaving for still greener pastures.
Armani left in March for a new building on Madison Avenue, following Donatella Versace who moved her emporium there several years ago. Marc Jacobs explored taking the Armani space but couldn’t agree to terms, KBRA said. Jeweler H. Stern found a lower rent somewhere else and is expected to leave at year’s end. Kim Kardashian’s shapewear company, Skims Body, agreed to fill the 20,000 square-foot building but at a rent of just $150 per square foot, compared to Versace’s $750. Skims is also to share a percentage of sales with the building owners.
Net cash flow at Olympic Tower and the mansions fell by 7% in the past year, to $56 million. Occupancy held steady at 88% but is 10 percentage points lower than before the pandemic. Citing “increasing expenses and weakness in retail leasing,” on Thursday KBRA downgraded three slices of a $480 million security backed by a part of the tower’s mortgage. The largest $100 million slice was lowered from BB- to B, a rating that KBRA says indicates “many fundamental shortcomings.”
The fundamental shortcoming for Olympic Tower might be that it’s located four or five blocks from where the action is on Fifth Avenue. Earlier this year, Gucci’s owner paid $963 million to acquire 717 Fifth Ave.; in December, Prada acquired 720 and 724 Fifth Ave. for $822 million. Rolex is developing a new headquarters building at 665 Fifth Ave., and LVMH Moët Hennessy Louis Vuitton plans to raze and rebuild its flagship Vuitton store at 1 E. 57th St.
A short walk south, retailers have leased posh spaces at hefty discounts. Two years ago fast-fashion brand Mango subleased more than half of Ralph Lauren’s 50,000 square feet of retail space at 597 Fifth Ave., at East 48th Street, for less than 20% of the rent due under the master lease, KBRA said.
Brokers say Olympic Tower is still considered a premiere location among luxury retailers and expect its vacant spaces will be filled. They add that Skims agreed to share a hefty 20% of gross sales above $10 million with Oxford Properties, a part of the Ontario Municipal Employees Retirement System that owns two-thirds of the building, and the rest is owned by the Chera family’s Crown Acquisitions, a longtime Fifth Avenue landlord.
“It’s a savvy operator making a bet on an up-and-coming retailer,” said Steven Soutendijk, executive managing director at Cushman & Wakefield. “A retailer could do $20 million, $30 million, even $40 million in top-line sales.”
He added that when Apple signed a bargain-priced lease for its underground location near the GM Building in exchange for a revenue-sharing deal, landlord Harry Macklowe profited immensely.
Crown didn’t reply to a request for comment. Oxford said: “We continue to have a positive outlook on Olympic Tower.”
Olympic Tower carries a total of $1 billion in debt, including mortgage and mezzanine loans that mature in 2027. About 20 floors are devoted to office, where tenants include Cartier and the NBA. Across the other 30 floors are 229 condo units averaging 16,000 square feet each, according to the building’s Wikipedia page.
For the posh tower’s merchants, a perennial challenge is that tourists prefer to stroll along Fifth Avenue to shopping inside an office building. Many restaurants and stores have come and gone over the years.
“The food has improved over time,” Soutendijk said. “It’s pleasant inside, gets good light, and it’s busy.”
Leases
Tech firm sublets Murray Hill space from Havas Health
Address: 200 Madison Ave., Manhattan
Landlord: George Comfort & Sons
Tenant: Samba TV
Lease size: 11,474 square feet
Lease length: Four years
Asset type: Office
Brokers: A Newmark team led by Jason Greenstein represented the landlord. Lincoln Property Co.’s Jeffrey Rosenblatt and Christina De Jesus represented the tenant.
Tishman Speyer lands another Spiral tenant
Address: 66 Hudson Blvd., Manhattan
Landlord: Tishman Speyer
Tenant: Fifth Wall
Lease size: 6,700 square feet
Asset type: Office
Brokers: Greg Conen and Sam Brodsky represented the landlord in-house. CBRE’s Ryan Alexander, Ross Zimbalist, Jared Isaacson and Jeff Frenkel represented the tenant.
Sales
Tribeca office tower marketed for residential conversion changes hands
Address: 101 Franklin St., Manhattan
Seller: Columbia Property Trust
Buyer: TPG Real Estate Partners
Sale price: $96.5 million
Asset type: Office
Read more about the deal here.
80-unit Midtown rental tower finds a taker
Address: 65. W. 55th St., Manhattan
Seller: Sachs Cos.
Buyer: John Choi
Sale price: $36 million
Asset type: Mixed-use
Financings
Residential development in Harlem lines up loan
Address: 2005 Third Ave., Manhattan
Owner: Elie Fouerti and Rybak Development
Lender: Goldman Sachs
Loan amount: $97 million
Asset type: Multifamily
Private equity bigwig Jim Coulter has had a busy month.
On June 20 the billionaire co-founder of the buyout firm TPG closed on an Upper East Side co-op for $36 million, according to the city register. The next day his Texas-based company plunked down about $97 million for 101 Franklin St., a Tribeca office building marketed for residential conversion. It also appears to be TPG’s second planned conversion project downtown.
Coulter’s new uptown digs, a five-bedroom corner unit with a private elevator, formal dining room and library, all styled with contemporary finishes, is on the ninth floor of 2 E. 67th St., an elite, 15-unit prewar building that faces Central Park.
The unit’s seller was Chilean financier Alvaro Saieh Bendeck, who controls Corp Group, a South American conglomerate with supermarket, media and bank holdings that filed for bankruptcy protection in the U.S. in 2021 after incurring liabilities of up to $10 billion, filings show.
The following year, Bendeck listed the Upper East Side home, which appears to have showcased some of his notable collection of Renaissance oil paintings, for $49 million. But two years later it sold for 27% less than what Bendeck initially sought, a significant break for Coulter and his wife, Phyllis, who purchased the unit through a jointly-controlled trust, records show.
Still, Bendeck shelled out $26 million for the apartment in 2007 and so appears to have come out well ahead.
The co-op 2 E. 67th, which is at Fifth Avenue, is a power-player favorite. Residents through the years have included Averell Harriman Mortimer, the grandson of former New York Gov. W. Averell Harriman, and his wife, Gigi Mortimer, who sold their maisonette-style unit in the summer of 2022 for $17 million, according to the register. The buyer in the off-market deal was Michael Dearing, a Silicon Valley venture capitalist.
Other people who have called the prewar limestone address home are Frances Scaife, an ex-wife of Richard Mellon Scaife, an heir to the Mellon banking and oil fortune; her six-bedroom, fifth-floor unit has been on and office the market for years.
Serena Boardman, the Sotheby’s International Realty agent who represented Bendeck, did not respond to a request for comment by press time.
Meanwhile, the Tribeca property, which once contained offices for the city’s Human Resources Administration and other agencies, also appears to have sold for less than its seller sought.
Indeed, former owner Columbia Property Trust and Normandy Real Estate Partners bought the 17-story, 202,000-square-foot property in 2019 for $206 million, suggesting that Columbia was willing to take a loss of more than 50% to get the deal done. (Columbia acquired Normandy in 2020.)
TPG's real estate investing arm, TPG Real Estate Partners, was founded in 2009 and today counts $12 billion under management, according to its website. Renovated under previous ownership, No. 101, which also uses the addresses 250 Church St. and 59 Leonard St., features 12-foot ceilings and three exposures.
TPG executives were unable to comment on the deal by press time, a spokeswoman said.
But it’s not the first downtown conversion in which TPG is involved, as interest builds in a concept that once seemed unworkable and fringe. Earlier this year the firm teamed with GFP Real Estate on a different conversion, of 222 Broadway, an office building near City Hall that they acquired for about $148 million.
TPG also recently took control of the office site 1825 Park Ave. in Harlem after previous owner Savanna failed to sell the Metro-North station-adjacent site for three years.
Co-founded in 1992 by Coulter and William Price, Texas Pacific Group, or TPG, has a total of $224 billion under management. Publicly traded since 2002, the firm had a share price on Friday of around $42, which is near its historic high.
Commuters who travel into the city on Amtrak and New Jersey Transit should brace for a rough summer of travel as transit officials work to diagnose the precise causes of a spate of grueling service disruptions to and from Penn Station.
Officials at the two railroads said Thursday that they are ratcheting up equipment and infrastructure inspections along 170 miles of track and at stations between New York City and Trenton, New Jersey to determine what’s behind multiple transit meltdowns that have snarled commutes in recent weeks. Amtrak board chair Anthony Coscia did not sugarcoat the severity of the disruptions along the Northeast Corridor, which carry some 500,000 travelers each day through Penn Station on hundreds of Amtrak, NJ Transit and Long Island Rail Road trains.
Coscia stressed that more travel headaches are to come until the root issues are addressed.
“More problems will occur as we [assess the situation], but we will fix these problems,” Coscia said at a Thursday afternoon news conference with New Jersey Gov. Phil Murphy in Newark. “There's nothing I'm going to say, or anyone else is going to say, that, well, it's really not so bad or don’t think about it. It is bad. It shouldn't be bad. And we need to make it better.”
Coscia, in a somewhat puzzling assessment, said that Amtrak has discovered an “issue in the interface” between its infrastructure and NJ Transit trains “that have caused these issues to reoccur” and “that we are moving heaven and Earth to determine the precise cause of that and to address it.”
Rail officials haven’t reached a consensus on what exactly is behind the spike in issues, but have cast blame on one another. Amtrak in one instance said improperly aligned NJ Transit equipment was the culprit behind a delay, while Kevin Corbett, NJ Transit’s president and chief executive, said on WNYC that the agency would hold Amtrak’s “feet to the fire” on infrastructure challenges. He’s also said that wires carrying power, which can sag during extreme heat, got tangled in equipment and led to other travel delays.
Amtrak and NJ Transit said they intend to bring in industry experts to help identify issues and develop solutions; Amtrak spokesman Jason Abrams said they haven’t yet hired consultants.
Gov. Murphy added Thursday that a “dysfunctional relationship” between the two rail agencies has complicated addressing past challenges. They’re now equally shouldering the blame and have agreed to collaboratively identify issues and solutions, the officials said.
“People don't care why it happened. They want to get home; they want to get to work,” said Murphy. “We also have to accept the reality that in both organizations you've got decades of underinvestment. We're making up for lost time on both sides of the house here.”
The math of real estate is simple, but immutable.
You cannot finance a project that pencils out at a loss. If a developer can’t make the math add up, the project won’t happen. Construction costs, timelines for zoning and permitting, labor contracts and taxes are part of the equation everywhere, of course. In New York, however, these are anything but straightforward calculations, with complexity layered upon complexity.
Let’s start with zoning.
But even when fully entitled, developers are still left with the one big question: What are the taxes? You can’t know until you get your temporary certificate of occupancy, and it will be another three years until there is certainty.
In New York, if you’re building an office building of, say, 1.2 million sq. ft. (average for Midtown), your taxes are likely to be between $40 million and $50 million a year. And if you’re building rental residential, taxes will eat up one-third of your effective gross income.
Simply put, we make it too hard to get big real estate projects done under the fallacy that if a developer receives a discretionary tax program, somehow the city is losing money. Not true. Look at the New York Times headquarters. Prior to building this 1.6-million-sq.-ft. tower, there were 10 smaller buildings on the site, collectively paying $900,000 in taxes per year. In its first year under the generous discretionary tax package the Times received, the new building paid $13.5 million.
Nevertheless, there’s an impulse to be punitive toward development, as if it’s an activity without risk and somehow every developer is going to hit the jackpot.
The good news is that we know we’re capable of doing big things.
Just look at what we achieved downtown in the aftermath of 9/11, which today is a market reimagined following two-plus decades of public and private investment, grit and hard work.
We didn’t get here by thinking small. In the wake of that attack, we had a real coming together of public policy, political support and great planning. And today, we’re on track to hit nearly 70,000 residents by 2025, up from 13,000 in 2000, and over 12 million sq. ft. of new, modern office space. This is what you can actually do when you bring forces together—and focus those forces on doing big things.
Now we have to do it again, only bigger—not as a result of a terrorist attack but of a terrible need to house people at all economic levels, to deal with New Yorkers who have mental health issues, to meaningfully address the migrant crisis, to address the misalignment between office supply and demand.
We have to do it again to build for our future. And it’s going to take an apolitical approach to get our policies right.
We should champion the initiatives being led by Mayor Adams, including streamlining approval processes, bolstering neighborhood retail and developing more affordable housing. And let’s build on the alignment between the Mayor and Governor on the “New” New York Panel and its recommended initiatives across a range of needs.
We know what works. We need to have the will to do it. And we need to get our public officials to understand that they can dream all they want for a new and better New York, but if the numbers don’t work, it’s all just noise.
Mary Ann Tighe is the CEO of the New York Tri-State Region at CBRE.
The outlook for Walgreens Boots Alliance continued to darken yesterday as its chief executive presented investors with an uncertain future besieged by challenges, including a core pharmacy business that’s unsustainable in its current form.
The Deerfield, Illinois-based company’s stock slid 25% yesterday after disclosing disappointing third-quarter earnings and revealing the pharmacy giant intends to shrink its footprint, write down assets and try to narrow its focus on profitable parts of the business.
The poor performance comes amid a $1 billion cost-cutting plan and a strategic review of the entire business, both of which were kick-started by CEO Tim Wentworth. The turnaround moves are intended to boost profits and investors’ confidence, but so far, there’s little evidence the plan is working or will pay dividends anytime soon. Executives said headwinds, particularly in its largest segments, are expected to last into next year.
“The question now is: Is the turnaround going to be slow or nonexistent?” said Erik Gordon, clinical professor at the University of Michigan’s Ross School of Business.
With lower-than-anticipated earnings in the quarter, Walgreens cut its full-year earnings guidance, just after lowering the top end of its guidance last quarter.
Morningstar analyst Keonhee Kim said he’s expecting next quarter to be difficult, too.
“Cutting guidance by that much signifies more challenges to come,” he said.
Walgreens’ stock is down 60% in the last year, which tanked its market capitalization, too. The company is worth just $10.3 billion today, compared to around $28 billion a year ago.
“It is a smaller business, as far as market cap is concerned,” Nathan Ray, a partner at Chicago consulting firm West Monroe, said. “Obviously, that is going to perpetuate certain changes and how they are thinking of and focusing on the business and its health.”
Laying out his plans, Wentworth told investors yesterday that Walgreens will focus on optimizing its pharmacy store footprint while deprioritizing underperforming parts of the business.
“We've already stopped or will stop initiatives that distract from our focus and will grow in areas that create longer-term shareholder value,” Wentworth said.
He acknowledged the retail pharmacy business faces several challenges, which is why it’s necessary to close some locations, but he maintains that physical pharmacy stores are still the linchpin to the company’s success.
Walgreens did not disclose how many stores it plans to close, but Wentworth said the company identified that about 25% of its stores are underperforming. It plans to close a “significant” portion of those locations over the next three years. The “vast majority” of workers at closing locations will be deployed to other locations or company departments. Additional closures would be considered if performance doesn’t improve, Wentworth said.
Walgreens’ pharmacy segment is being challenged by several factors, but Wentworth said lower prescription demand and reimbursements are “materially weighing” on the company’s ability to serve patients profitably.
“We are at a point where the current pharmacy model is not sustainable and the challenges in our operating environment require we approach the market differently,” Wentworth said.
His solutions include working with pharmacy benefit managers and payers to boost reimbursements.
On the retail side of the business, Walgreens is challenged by consumers pulling back on spending in stores as inflation persists and shopping continues to shift online. To improve its retail offerings, Wentworth said Walgreens removed eight national brands and redeployed the space to its own brands and preferred partners in health and wellness categories. Walgreens is also working to expand its loyalty program.
“The retail pharmacy experience will be more important to the health care industry in the years ahead, but it will evolve,” Wentworth said. “The bottom line is that I'm confident (Walgreens) will be a leader in the future of health care with pharmacy and retail at its center.”
‘Grace period’Even with Wentworth’s plan to double down on Walgreens’ pharmacy retail roots, it’s unclear whether he can boost the company to Wall Street's expectations. The pressures on pharmacy retail companies have been snowballing for years. And unlike its biggest competitor, CVS Health, Walgreens doesn’t own other large health care-related assets, like an insurance company or a pharmacy benefit manger, which could potentially help it manage expenses and bring in revenue.
“(Walgreens is) not going to be able to spend billions of dollars diversifying their revenue streams the way CVS has,” Gordon said. “It’s too late for that. But it puts even more pressure on them to make what they have profitable.”
Walgreens’ health care segment, which was championed under former CEO Roz Brewer, was intended to help diversify the business. Brewer poured billions of dollars into health care assets like primary care provider VillageMD, post-acute and home care firm CareCentrix and other businesses, but the segment was slow to reach profitability, which led to the closing of VillageMD locations and a $6 billion impairment charge on the asset. (Walgreens took a $431 million impairment charge on its Boots segment yesterday.)
Notably, Wentworth didn’t talk much about Walgreens’ health care segment being a key area of growth on Thursday's earnings call, despite the company’s investments. And according to a Wall Street Journal report, he said Walgreens intends to reduce its stake in VillageMD and will no longer be its majority owner. A Walgreens spokesman declined to confirm or comment on the report.
Wentworth didn’t mention that detail to investors on the earnings call, either, but he did say the company believes in the future of the VillageMD asset and that it intends to remain an investor and partner.
“We are collaborating with leadership toward an endpoint to rapidly unlock liquidity, enhance optionality and position them for additional growth,” he said.
Wentworth became CEO of Walgreens in October, following Brewer’s sudden departure. He was installed on the promise that his health insurance and pharmacy benefit manager experience would help improve Walgreens’ flailing business. But he has yet to show investors he can offer an effective solution to the company's many challenges, Gordon said.
“Things don't appear to be better in any way,” he said. “The new CEO gets a certain grace period to turn around the wreck, but the grace period doesn't last forever.”
The chef behind Manhattan's famed restaurant Eleven Madison Park is planning a new eatery in the West Village.
Daniel Humm has inked a lease for 5,000 square feet at 435 Hudson St. for his next culinary hotspot and expects to open the project late next year. Tungsten Property represented Humm and landlord Hudson Square Properties in the deal.
A representative for Humm and Hudson Square Properties, which is a joint venture of Trinity Church Wall Street, Norges Bank Investment Management and Hines, declined to share the length of the lease and its asking rent. Hines Senior Managing Director Jason Alderman said in a statement that they were "thrilled to welcome Chef Humm to the neighborhood."
The property at 435 Hudson St., which was built in 1931, stands 9 stories tall and spans about 288,000 square feet. Office tenants include Adidas, L'Oreal and RadicalMedia, while S10 Fitness is a retail tenant. Estimated office rents range from $60 to $73 per square foot, according to CoStar.
The building is 96.4% occupied. The lease with Humm will not change this either way, as his restaurant is backfilling the space of an existing tenant.
Humm is best known for his three-Michelin-star restaurant Eleven Madison Park, located right by Madison Square Park at East 24th Street and Madison Avenue. Restaurateur Danny Meyer initially recruited him to run the kitchen, and Humm then bought the restaurant outright in 2011 with his former partner, Will Guidara. It was named No. 1 on the 2017 World's Best 50 Restaurants list and famously switched to an all-plant menu in 2021. The establishment charges $365 for a 10-course meal.
Humm also flipped his Greenwich Village penthouse for a healthy profit last year. He had bought it in 2021 for $14.5 million and sold it in July for $17 million.
Nearly one-quarter of all U.S. office space will be vacant by 2026 as working from home persists, slicing commercial-property values by as much as $250 billion, according to a report from Moody’s.
Office-vacancy rates are expected to rise to 24% from 19.8% in the first quarter of this year, reducing revenue for office landlords by between $8 billion and $10 billion when combined with the impact of lower rents and lease turnovers, the authors of the report said. That, in turn, could translate into “property value destruction” in the range of a quarter-trillion dollars, Todd Metcalfe, Moody’s associate director of commercial real estate forecasting, and Tom LaSalvia, Moody’s head of CRE economics, said in a separate analysis that’s not contained in the report.
The figures illustrate the gloomy prospects faced by property owners and lenders as employers continue to jettison square footage or shift from multi-year leases to shorter-term and more flexible co-working arrangements. A full 85% of North American organizations polled by brokerage Jones Lang LaSalle have implemented hybrid work, and occupancy across offices in major cities is stuck at about 50% of prepandemic levels. Wavering demand and increased borrowing costs have slammed office valuations, especially among older buildings.
“The argument for maintaining or even increasing remote work practices remains compelling for many businesses,” the Moody’s authors said. “If productivity remains stable and costs can be reduced by forgoing physical office spaces, the rationale for mandating in-office attendance diminishes.”
Moody’s analysis focused on white-collar sectors that have highest work-from-home rates and also account for the lion’s share of office property, such as the finance, information, real estate and administrative sectors. It controlled for those who worked from home before the pandemic, and accounted for the ongoing decline in office space allotted per worker, which began after the 2008 financial crisis and has accelerated since then.
Using multiple sets of government and academic data including the Survey of Working Arrangements and Attitudes, Moody’s determined that office workers today need about 14% less office space than they did before the pandemic. The figure corresponds to research from the McKinsey Global Institute, which concluded that there will be 13% less demand for office space in a typical city globally by 2030. McKinsey also found that office-property values will decline by anywhere between $800 billion and $1.3 trillion over that time period.
Eventually, the Moody’s authors said, vacancy rates will plateau as enough offices are torn down or converted to other uses like warehouses or residential property.
“Right-sizing will continue over the next decade as the market shakes out less efficient space for flexible floorplans that support our relatively new working habits,” the report said.
Paul Singer’s Elliott Investment Management is nearing a deal to relocate its offices to a spot on Park Avenue.
Elliott is in talks for roughly 150,000 square feet of offices at 280 Park Ave., a spot that would make the firm closer to Grand Central Terminal, according to people familiar with the matter, who asked not to be named citing private matters.
The new space would help the firm consolidate its workforce on three floors next to each other, one of the people said. At its current spot at 40 W. 57th St., the firm was spread out among six floors that weren’t all connected.
Spokespeople for Elliott and SL Green Realty, one of the property owners, declined to comment. Another landlord, Vornado Realty Trust, didn’t respond to a request for comment.
Singer’s hedge fund, which manages roughly $66 billion in assets, relocated its headquarters to Florida during the pandemic, a hot destination for its peers including Ken Griffin’s Citadel. Elliott maintained its space in Midtown and also opened an office in Greenwich, Connecticut.
Finance firms with offices in New York City have been drawn to high-quality buildings near transit hubs such as Grand Central. Businesses such as JPMorgan Chase and Griffin’s Citadel have particularly gravitated toward Park Avenue, mapping out massive new skyscrapers in the area in recent years. Nearby, the Seagram Building signed more than 100,000 square feet of new leases and renewals last year.
New York City Health + Hospitals’ board of directors greenlit a $13 million contract on Thursday to renovate Elmhurst Hospital’s labor and delivery suite.
The public hospital system’s board unanimously approved a contract of up to $12.9 million with Vanguard Construction, a Midtown-based building company, to gut and renovate more than 15,000 square feet of labor and delivery services.
The renovated suite is expected to include six expanded delivery rooms, an operating room for C-section births, two nurse stations, eight recovery rooms and waiting areas. Elmhurst Hospital is also planning to build a maternal-fetal medicine center, which is designed to treat high-risk pregnancies.
“We hope to improve the standard of care throughout the unit,” said George Asadoorian, lead capital director at Elmhurst. As a part of the renovation, the hospital will acquire updated medical equipment including electrical fetal monitors, cardiac monitors and ultrasound machines.
The labor and delivery suite at Elmhurst, built in 1957, has seen a significant uptick in births in recent years. Last year, there were more than 2,600 deliveries at Elmhurst, up from roughly 1,800 in 2021 – a 46% increase, said Milenko Milinic, the hospital’s chief operating officer.
Milinic said that the renovations are part of the hospital’s effort to meet increased demand for pregnancy care.
The renovation is fully funded by local lawmakers, Milinic said. Congresswomen Alexandria Ocasio-Cortez and Grace Meng, who represent the district where Elmhurst is located, provided $3 million, and Mayor Eric Adams, Borough President Donovan Richard and City Council members allocated the remaining funds.
The hospital expects to begin construction of the updated maternity suite this September and is aiming to complete the project by October of 2026.
H+H has 11 public hospitals across the five boroughs, as well as more than 30 Gotham Health outpatient clinics and five long-term care facilities.
CORRECTION: A previous version of this story, which was published on June 27, misstated that EvolutionaryScale raised money prior to its most recent fundraising round. The story has been corrected to reflect that the company's total funding is over $142 million.
OPIOID SCRIPTS: Opioid prescriptions in New York have dropped more than 40% in the past decade, part of an effort to reduce the number of addictive painkillers circulating statewide, according to a report released on Thursday by the state Department of Health. Overuse and overprescribing of opioids that started in the 1990s contributed to the state’s deadly overdose epidemic, which killed more than 5,000 New Yorkers in 2022, the most recent year data is available. The number of filled opioid prescriptions dropped from 9 million in 2013 to 6 million in 2022, the data shows.
HOUSING CONTRACT: The Department of Health and Mental Hygiene issued a $6 million contract to Weston United Community Renewal, a nonprofit based in Harlem, to provide permanent supportive housing, according to a notice in the City Record Thursday. The contract covers 16 supportive housing units and offers aid to prevent homelessness, incarceration and psychiatric hospitalization.
Hospital mergers can mean rising prices for individual patients, but there also may be implications for the larger economy, including higher unemployment costs and reduced tax revenue, according to a study published Monday by the National Bureau of Economic Research.
A study compiled by researchers from four universities including Yale and Harvard, as well as the Treasury Department, on the downstream effects of hospital mergers concluded that resulting price increases hurt employers and workers outside the health care industry.
The study analyzed data provided by independent research group Health Care Cost Institute, representing 28% of people in the U.S. with employer-sponsored insurance, and pulled information from Labor Department and Internal Revenue Service filings.
Here are five takeaways from the study.
1. Hospital mergers could lead to job losses.
Hospital mergers led to inpatient and outpatient prices rising an average 1.2% in the two years after a transaction, based on data from 304 hospital mergers between 2010 and 2015. Approximately 40% of the hospitals involved in those 304 mergers raised prices by more than 5%.
An average hospital that raises prices by 5% following a merger would result in more than 200 health care and non-health care job losses, due to an employer's need to cut costs when premiums rise, the study said.
"A lot of what we talk about, when we talk about health spending, is out-of-pocket costs, and those are real," said Zack Cooper, associate professor of public health and economics at Yale University and an author of the study. "But I think in many ways the more subtle and potentially pernicious consequence of rising health spending is actually these labor market outcomes."
2. Employers trim payrolls when premium costs rise.
Many working-age adults in the U.S. are covered by employer-sponsored health plans. Workers likely are more willing to accept the cost burden from rising premiums if the quality of health care services and benefits is also rising, the study said. When quality doesn't increase, workers don't want to shoulder the cost burden, and employers turn to layoffs to trim expenses, rather than shifting those workers to high-deductible plans. As a result, a 1% increase in health care prices leads employers to reduce payroll by 0.4%, the study found.
3. Higher health care prices result in lower tax revenue.
A 1% increase in health care prices reduces federal income tax revenue by 0.4% as workers are laid off. Unemployment insurance payments rise by about 2.5%, according to the study.
"It isn't just a health care issue. This is a solvency issue that we need to tackle head on," Cooper said.
4. The middle class is hardest hit when prices rise.
Workers earning more than $100,000 annually aren't as affected by layoffs stemming from higher premiums. Changes to premiums act like a "head tax," as those costs are generally uniform among employees. As a result, paying a $5,000 premium for one employee earning $100,000 annually ends up being cheaper than paying that premium for two employees each earning $50,000 annually.
Workers earning less than $20,000 annually also aren't affected by layoffs because low-wage employees don't typically receive health insurance from their employer.
"This is sort of like a death by a thousand cuts," said Zarek Brot-Goldberg, assistant professor at the Harris School of Public Policy at the University of Chicago and another author of the study. "These small cuts add up to something big."
5. Rising health care prices are connected to suicide and overdose rates.
Job losses can lead to severe health consequences, and the death-per-job-loss rate in the U.S. has increased with the opioid epidemic. About 1 in 140 workers die of an opioid overdose within a year of losing their job, the study found.
A 1% increase in health care prices, coupled with the downstream effects, leads to a 2.7% increase in deaths from suicides and overdoses among adults aged 25 to 64.
This article originally appeared in Modern Healthcare.
More than a year and a half after a court-ordered deadline requiring New York City to build trans gender-affirming homeless shelters, those shelters have yet to be built – a fact that advocates say violates the spirit of their court order.
The city agreed in a 2021 federal court settlement to create dedicated homeless shelters or units within existing shelters for transgender people, after trans activist Mariah Lopez alleged sexual and physical abuse and discrimination at Marsha’s House in the Bronx, the city’s lone LGBTQ+ shelter for adults.
The agreement marked what the city described as a period of systemic change for transgender and gender non-conforming adults. The Department of Homeless Services agreed to build four shelters or units – one in every borough except Staten Island – for trans people by December 2022.
The city has not yet built shelters designed for transgender people, said Nicholas Jacobelli, a spokesman for the Department of Social Services. But city officials have designated at least 30 beds each across Manhattan, the Bronx, Brooklyn and Queens, which they say is in compliance with the legal settlement.
“We are committed to creating a safe and welcoming environment for every LGBTQIA+ New Yorker who comes to us in need of shelter," Jacobelli said.
But Lopez said that the city has re-designated existing shelter beds rather than create gender-affirming spaces, which she says violates what advocates initially asked for.
“The intention is to have enough beds for everyone,” Lopez told Crain’s. “None of them are in compliance.”
Lopez and the Strategic Trans Alliance for Radical Reform, an advocacy group revived by Lopez and founded by trans activists Marsha P. Johnson and Sylvia Rivera, are scheduled to hold a rally at 11 a.m. today to push the city to build transgender homeless shelters in what they say is adequate compliance with the settlement. The rally comes on the anniversary of the Stonewall Rebellion, marking more than 50 years since the police raid on the Stonewall Inn became a turning point for gay rights.
Usman Mohammad, attorney at Kostelanetz who is representing Lopez, said the city “cannot meet its legal obligation to create [transgender and gender non-confirming] shelter units, let alone its TGNC-affirming shelter-creation obligation, by re-labeling a few beds in cisgender shelters as ‘TGNC beds.’”
Lopez’s counsel and the city disagree on what exactly the settlement requires. The settlement mandated that the city build shelters with at least 30 beds apiece or choose to forgo that requirement by creating units within existing shelters. The intent was that beds within units would be self-contained and separate from the rest of the shelter, the agreement says. They city is required to maintain those units through 2026, or until a new gender-affirming shelter is built.
According to the settlement, the shelters were required to include infrastructure specifics such as single-stall bathrooms and showers, but also to provide gender-affirming care, such as ensuring staff were trained to refer to residents by their chosen name and pronouns.
Lopez said that activists are still waiting on the city to complete these requirements, and expect officials to keep their promises to establish separate shelters.
“We think that these new shelters are just going to set a standard that is different,” Lopez said. “We need to create shelters that are good for everyone.”
Lopez has made a name for herself suing the city over transgender rights. She was the lead plaintiff in a 1999 class-action suit and settlement over alleged abuse of transgender youth in foster homes and has since sued the city at least 14 times.
Her continued legal battles over transgender rights have coincided with the public’s growing awareness of the obstacles faced by the trans community. Transgender and non-conforming people face a heightened risk of homelessness, putting them at risk of physical or sexual violence and infections such as HIV/AIDS.
Lopez’s most recent case detailed discrimination and abuse that she says is not uncommon. She filed a civil case in state court pro se in 2017 alleging verbal, physical and sexual abuse at Marsha’s House in Belmont. Several male staff members, who were employed by the nonprofit Project Renewal, which operated the shelter, called her names and made unwanted sexual advances, according to the filings.
The Department of Homeless Services then placed Lopez in a women’s homeless shelter in Park Slope, a facility that she said failed to meet her medical and social needs and violated anti-discrimination laws. She challenged the agency’s refusal to place her in a gender-affirming facility – a challenge that the city attempted to dismiss. But the court battle resulted in the so-called Lopez Settlement, which required the city to build shelters designed to offer gender-affirming care.
Newly formed businesses flourished in the outer boroughs but stagnated in Manhattan during the first few years of the Covid-19 pandemic, according to a new report by the state comptroller’s office.
The report, which analyzed federal labor data, found that Manhattan saw the slowest business growth rate of any borough between 2019 and 2023, at just .04%. Brooklyn, by comparison, experienced a 13% surge in that span, as the number of businesses based in the borough jumped from 64,000 to 72,000. Queens, the Bronx and Staten Island all saw growth above 6% as well.
The rise of remote work and demand for larger living spaces may have contributed to the outer-borough growth, according to the analysis by Comptroller Tom DiNapoli’s office. Neighborhoods with the most business growth over those four years included Bedford-Stuyvesant (35%), Bushwick (30%) and Crown Heights North (27%), with similar gains seen in Manhattan’s Harlem (19%) and Wakefield in the Bronx (19%).
Jobs in the information and professional services sectors largely propelled that boom, the report found.
“Neighborhoods in Manhattan below 96th Street saw declines or comparatively slow growth over the period, as overall population, commuters and foot traffic in the borough declined,” the report reads.
But other measures show how New York City’s recovery slowed after the early-pandemic boom, and began lagging the rest of the country.
Very small businesses — defined as five employees or fewer — surged by 9% in New York City from 2019 to 2021, part of a well-documented trend of entrepreneurship spurred partly by people who had been laid off from larger firms, and fueled by federal aid. That growth was roughly in line with a 10% increase in very small businesses nationally during the same years. (In the two years before the pandemic began, very small businesses grew by only about 1% in the city.)
But in the ensuing two years, from 2021 to 2023, growth returned to prepandemic levels in New York City, as the number of very small businesses increased by just 1% — even as the national pace picked up to 14%. All told, the number of very small businesses in the city grew by a total of 10% from 2019 to 2023, reaching 198,000 by the end of last year.
The city’s lagging recovery meant it did not reach its prepandemic job levels until late 2023, more than a year after the rest of the U.S. reached that milestone. Bigger businesses in the city were less affected by that late-pandemic slowdown — firms with 50 to 249 employees grew by 20% from 2021 to 2023.
New York’s pandemic recovery has been uneven in other respects, despite Mayor Eric Adams’ frequent boast that “jobs are up.” Other studies have found that the city’s pandemic-era wage growth has mostly benefited high earners, with low-wage workers seeing fewer gains.
“Significant job losses during the Covid-19 pandemic took a toll on the city’s economy, but resilient New Yorkers fueled small business growth,” DiNapoli said in a statement. “Changes to how people work and how businesses operate, along with federal aid, allowed people to either start a business or expand by providing services more easily online.”
The city’s lessons from its pandemic experience should include expanding access to capital for small-business owners, DiNapoli argued — along the lines of the $85 million loan fund that the Adams administration distributed to more than 1,000 businesses last year. The comptroller’s report also looks favorably on the mayor’s City of Yes for Economic Opportunity plan, approved by the City Council this month, which loosens zoning rules in hopes of making it easier for businesses to locate and grow.
Mayor Eric Adams’ administration has reached a deal with the City Council on a budget that undoes at least some of the cuts he had previously imposed and adds new funding for housing construction, according to City Hall and a person familiar with negotiations.
The mayor’s office announced Thursday evening that it had agreed to fully restore $58 million in cuts to the city’s three public library systems, which would have ended weekend service, and undo a separate $53 million cut to cultural institutions. The preliminary deal also includes $43 million in new recurring funding for the libraries, according to the source, who requested anonymity to discuss ongoing talks. (Gothamist first reported the restored funding.)
Additionally, the Adams administration has agreed to commit $2 billion in new capital money for housing over the next two years, two sources confirmed. That funding, first reported by the Daily News, comes after affordable housing advocates had warned that production would drop under Adams’ most recent spending plan, unless funding were increased by at least $800 million.
The housing commitment includes $1.3 billion for the Housing Preservation and Development department, with allocations including $128 million for supportive housing and $470 million for new multi-family rental projects, according to details shared with Crain's. The remaining $700 million will go to the New York City Housing Authority.
Further details of the deal are expected to be announced on Friday in a traditional “handshake” at City Hall between the mayor and Council Speaker Adrienne Adams. The full budget is likely to be passed by the council on Sunday.
“Since day one, our administration has been laser focused on delivering for working-class New Yorkers and by working side-by-side with our partners across the hall, we are proud to announce a full restoration of funds to both our libraries and cultural institutions in the upcoming budget,” Mayor Adams said in a statement. “These institutions are a critical part of New York City’s social fabric, which New Yorkers depend on for their children’s growth and the vibrancy of our city.”
Lawmakers’ top priority over weeks of negotiations has been reversing about $1.6 billion of the roughly $7 billion in cuts that Mayor Adams had ordered starting last year, and it was not immediately clear on Thursday how much of that money had been restored.
Speaker Adams had warned in recent weeks that the two sides remained far apart as the clock wound down ahead of the city’s June 30 budget deadline. But Mayor Adams had insisted that a deal would get done in time, and sources told Crain’s last week that significant progress had been made on other key issues.
“The Council has consistently championed funding restorations for these institutions as a top priority, and we’re proud to reach an agreement with Mayor Adams and the administration to successfully secure these critical investments for them in the city budget,” Speaker Adams said in a statement on Thursday.
After months of cost-cutting and dire warnings about the impact of the migrant crisis on the city’s finances, Adams softened his tone earlier this year, canceling plans for additional cuts and even restoring some of the funding he had recently cut for the police, trash can pickups and pre-schools. He attributed this sunnier view to a mix of successful efforts to pare down spending on migrant care, new aid from the state, and his administration’s more optimistic tax revenue forecasts, which brought City Hall’s conservative numbers closer to projections from other observers.
Trader Joe’s frozen dinners are known for being easy to heat up.
But tensions in a behind-the-scenes battle involving the supermarket’s site under the Ed Koch-Queensboro Bridge may not thaw anytime soon.
The fight pits Christine Gordon, the wife of late mall developer Sheldon Gordon, who controlled the bridge site on East 59th and First Avenue for decades, against the partnership of Maddd Equities and Joy Construction, which purchased the ground lease on the Upper East Side property from the Gordons in 2020 for $42 million.
At stake is $1 million that Sheldon Gordon offered as a sort of seller financing to help seal the tricky deal and with the expectation that it had to be paid back, as Christine Gordon sees it.
Or, as Maddd and Joy believe, the money was actually a credit provided as a balm during the worst days of the Covid crisis and no different than the $3 million that was lopped off the original price around that time. They believe no payback is necessary, public documents indicate.
But after months of the two sides being at loggerheads, Christine Gordon on Wednesday decided to enlist a judge to settle the matter, suing Maddd and Joy in Manhattan Supreme Court for that money plus interest at a rate of 18%. (The store is not part of the suit.)
“It’s a matter of fairness, and it’s a matter of contract,” Jim Kennedy, Gordon’s lawyer in the case, told Crain’s.
The dust-up comes amid a much more heated and protracted legal clash at the property, which historically was known as Bridgemarket and that was home to a Food Emporium store for years.
Indeed, since 2017 a group linked to developer Jenel Management Corp., which snapped up the Food Emporium’s assets after it went bankrupt, has been battling Christine Gordon in court for allegedly blocking its efforts to rent out the site after the Food Emporium’s 2015 closure.
Filings show that Jenel supposedly invested $7 million to improve Bridgemarket, a landmarked space with vaulted ceilings lined with rectangular Guastavino tiles, but never leased the property to a new tenant.
Although that drawn-out fight does not specifically name Maddd or Joy, it still may be clouding relations between the former and current owners, the developers say.
“My sense is that the new case has more to do with all the previous years of litigation as well as something to do with the timing of the closing, which was marked by lots of confusion and disarray,” said Joy principal Eli Weiss, who closed on Bridgemarket property in May 2020 as the coronavirus was ravaging New York. “I think there’s some spillover.”
The site of a farmer’s market in the decades after the bridge opened in 1909 before becoming a storage area for Department of Transportation vehicles after the market shut down in the Great Depression, Bridgemarket welcomed the Food Emporium in 1999, though the grocery store lasted only until 2015 after its parent company, A&P, filed for bankruptcy protection.
In 2021 Trader Joe’s, which has nine locations in Manhattan, opened its 30,000-square-foot store at the site, which is technically owned by the city of New York and leased out. It also houses an outpost of discount retailer T.J. Maxx and the event space Guastavino’s, whose operator is the Rose Group of church-turned-party-venue 583 Park Ave.
Frequent partners on projects, Madd, which is led by Jorge Madruga, and Joy previously built the apartment buildings 445 W. 36th St. and 411 W. 35th St. in the Hudson Yards neighborhood. They also redeveloped 20 Bruckner Blvd. in Mott Haven, the Bronx, a former ice factory now occupied by a charter school.
For his part, Sheldon Gordon, who died in 2017, built shopping centers across the country, including at casinos such as Caesar’s Palace in Las Vegas and Mohegan Sun in Connecticut, according to an obituary. He obtained the ground lease for Bridgemarket from the city in 1993, filings show.
Hotel occupancy in New York has clocked within a half percentage point of where it was in 2019 for the first time since the start of the pandemic. It's a promising sign for the city's slow but steady tourism recovery heading into the peak summer travel months.
That's according to the latest monthly economic snapshot report from the New York City Economic Development Corp., which tracks metrics relating to the health of the labor market, business activity, tourism and more.
The hotel room occupancy rate jumped from 84.7% in April to 89.1% in May, putting it well above the 83.9% the city saw last May and within striking distance of the 89.4% rate it boasted in May 2019.
The bullish recovery report coming in late spring is perhaps the result of rebounding leisure travel. While business travel has been slow to bounce back from pandemic-induced woes, leisure travel has returned in such strength that it is now offsetting the lull in work-related trips.
On the other hand, some hotel industry experts have told Crain's the notable improvement in the hotel sector’s fortunes over the past year seems to have more to do with government interventions than any major market turnaround. Efforts to grapple with issues including the migrant surge and illegal short-term rentals, such as units listed on Airbnb and other platforms that violate housing codes, have removed tens of thousands of rooms from the market, which in turn could be giving a boost—at least on paper—to traditional hotels.
Lodging aside, the NYCEDC report was not all roses for the tourism sector. Broadway attendance last month averaged about 92% of where it was in 2019. Subway and bus ridership ticked up slightly from April but remain far cries from their prepandemic levels, now sitting at 71.7% and 59.5%, respectively.
How else is the city's pandemic recovery faring? Here are other key takeaways from the report:
- New York added 4,600 private sector jobs in May. The city now lays claim to roughly 49,800 more jobs than it did before the pandemic.
- The unemployment rate held steady month-over-month at 4.8%. In February 2020, just prior to the pandemic, that figure was 4.3%.
- The first quarter Black unemployment rate was 7.9%. The Latinx unemployment rate was 6.7%.
- The Real Estate Board of New York's overall office visitation rate increased to 75% in April, the highest reading in six months.
- Kastle Systems, on the other hand, which also tracks office occupancy, puts that number closer to 65%.
- In the third quarter of 2023, the latest period for which data is available, the city saw net business formation in the red. While about 5,500 new businesses started, closer to 5,900 closed.
See the full June 2024 NYCEDC report here.
JPMorgan Chase is nearing a deal to buy a property near its new Park Avenue headquarters.
The bank is in talks to purchase from AEW the office tower at 250 Park Ave., nearby the bank’s new headquarters that’s going up at 270 Park Ave., according to people familiar with the matter. Plans for the building are still in the early stages, according to the people, who asked not to be identified citing private information.
The deal is not yet completed and could still fall through, the people said. A spokesperson for JPMorgan declined to comment.
A team of Newmark Group brokers led by Adam Spies and Doug Harmon is handling the sale process for AEW. Representatives for AEW and Newmark didn’t immediately respond to messages seeking comment.
The bank has been building a 60-story skyscraper for its new headquarters that’s expected to be 1,388 feet tall. JPMorgan, which tore down its old spot, has been laying out plans for amenities such as yoga and cycling rooms, as well as outdoor space.
JPMorgan initially expected to have as many as 14,000 employees in the new headquarters. But after pandemic-era flexible work arrangements largely went away, the firm scaled back the total number of employees it expects will fit into the new building to as many as 10,000 — about half of its New York City workforce.
The JPMorgan project was the first approved under New York’s 2017 rezoning of Midtown East, designed to encourage development of modern, taller skyscrapers in the neighborhood. As part of the deal to erect a much higher building, JPMorgan is also investing heavily in public improvements in the area.
Just a few blocks away from JPMorgan’s new headquarters, Ken Griffin is also planning a new office tower. Citadel and Citadel Securities will be the anchor tenants in the 62-story building at 350 Park Ave. The developers have struck deals for air rights from nearby churches including St. Bartholomew’s Church and St. Patrick’s Cathedral for the new tower.
If New York cannabis applicants are wondering why the licensing process is slow, they just need to look at the number of lawsuits facing the state’s Office of Cannabis Management. At the recent New York Cannabis Law Conference, Rudick Law Group lawyers Fatima Afia and Lauren Rudick counted at least 20 cases involving the oversight board.
And that doesn’t include any cases involving the hemp program, medical program or that were brought to small claims court or against other third-party actors.
That many cases can certainly distract from daily operations, so it’s no surprise that the OCM is behind on issuing licenses and answering Freedom of Information Law requests.
(For full disclosure, Green Market Report has pending FOIL requests with the OCM.)
Afia and Rudick said there were so many cases that they broke them down into seven subject areas:
- The Conditional Adult-Use Retail Dispensary (CAURD) program
- The Social and Economic Equity (SEE) program
- Extra priority status
- Location approval and proximity protection
- Queue review process
- Validity of the Marihuana Regulation and Taxation Act (MRTA), which includes arguments around preemption and the federal prohibition of cannabis
- Enforcement against noncompliant/illicit operators
Of the 20 cases, 12 are active at this time. While the program was dealt a major setback when one temporary restraining order was upheld by the courts, five other TROs have been denied.
Read the full story at Green Market Report.
Leases
Car club moving to former Toyota dealership
Address: 645 11th Ave., Manhattan
Landlord: Bram Auto Group
Tenant: Classic Car Club
Lease size: Approx. 60,000 square feet
Lease length: 20 years
Asset type: Retail
Brokers: Ripco Real Estate represented the landlord. Avison Young's Peter Gross represented the tenant.
Hair brands taking office space at 25 Kent
Address: 25 Kent Ave., Brooklyn
Landlord: Rubenstein Partners
Tenant: Amika and Eva NYC
Lease size: 19,000 square feet
Lease length: 10 years
Asset type: Office
Brokers: JLL's Sam Seiler represented the landlord. JLL's Michael Berman and Whitten Morris represented the tenant.
Sales
AMS Realty unloads four Fort Greene affordable housing sites
Addresses: 80 Greene Ave., 221 Ashland Place, 33 and 53 St. Felix St., Brooklyn
Seller: Abram Shnay
Buyer: Settlement Housing Fund
Sale price: $90 million
Asset type: Multifamily
Financings
Developer scores loan for Yorkville medical office project
Address: 1524 First Ave., Manhattan
Owner: Extell Development Co.
Lender: Cain International
Loan amount: $50 million
Asset type: Mixed-use
The owner of 9 Times Square has agreed to sell the office building for 60% less than it paid 10 years ago.
American Strategic Investment Co. said Wednesday that an unidentified party entered into a letter of intent to buy the 21-story, 170,000 square-foot tower for $63.5 million — $100 million less than the company paid in 2014.
9 Times Square, also known as 200 West 41st St., is a Class B building developed in 1926 at the southwest corner of Seventh Avenue. It is 30% vacant, according to a regulatory filing. Tenants include I Love NY Gifts on the ground floor.
Once known as New York City REIT, American Strategic Investment a decade ago amassed a portfolio of 1.2 million square feet of office and residential space in New York, much of it in older buildings that are now out of favor with commercial tenants. The publicly traded company has nearly $700 million in real estate assets but just a $24 million market capitalization, meaning investors have almost no confidence management can extract value from the portfolio assembled in better times.
The sale of 9 Times Square is no sure thing. American Strategic Investment has agreed to a term sheet but not a definitive purchase agreement. That means the buyer could still back out.
In a statement, CEO Michael Anderson said the sale of 9 Times Square should produce $13.5 million in net proceeds and will strengthen the firm’s balance if the transaction is completed. 9 Times Square carries a $50 million mortgage written by Capital One Bank, which has modified the loan twice, according to a quarterly filing.
The firm is also trying to sell its 550,000 square-foot office building at 123 William St. and a condominium at 196 Orchard St. Other holdings include a parking garage in the Upper West Side condo complex formerly called Trump Place and a 250,000 square-foot office tower at 1140 Sixth Ave., which is 23% empty. Cornell University’s medical school is moving out 30,000 square feet of lab space at 400 E. 67th St.
American Strategic Investment had a $2.9 million operating loss in the first quarter on $15 million in rental revenue.
Distributing affordable housing projects fairly throughout the five boroughs and not building enough homes in general remain two glaring problems for the city, according to a pair of recently released studies.
The city produced 14,227 new units of affordable housing last year overall, heavily concentrated in neighborhoods such as the South Bronx, central Brooklyn and northern Manhattan, according to the New York Housing Conference's third annual housing tracker report.
The study looks at the number of affordable housing units by City Council district and shows a stark disparity between the top and bottom 10 districts. District 17, which covers South Bronx neighborhoods including Hunts Point and Longwood, produced the most units last year at 1,266, more than the bottom half of all council districts combined, the report says. District 21 in Queens, which includes the neighborhoods Corona and Elmhurst, came in second with 1,031 units. No district in the top 10 produced less than 600 units last year.
"I couldn't be prouder of what we've accomplished, ensuring these units are genuinely affordable with historic area median income (AMI) levels," said Councilman Francisco Moya, who represents District 21. "I will continue to advocate tirelessly for our community's well-being."
By contrast, District 1, covering Lower Manhattan neighborhoods such as Tribeca and the Financial District, produced no affordable housing at all last year, nor did District 5, which includes portions of Midtown East and the Upper East Side. The highest number of units produced by a district in the bottom 10 was six.
Councilwoman Julie Menin, who represents District 5, released a statement highlighting her support of an Upper East Side project with 146 affordable housing units as part of the East 94th Street rezoning earlier this year in response to the report.
"Increasing affordable housing in New York City is of critical importance and a top priority for me and my colleagues as the shortage of available housing units has contributed to an affordability crisis affecting all New Yorkers," she said.
A representative for Councilman Christopher Marte, who represents District 1, did not respond to a request for comment by press time.
Rachel Fee, executive director of the New York Housing Conference, said in a statement, "We can't continue to let low-density neighborhoods off the hook from developing any affordable housing."
She added that the housing tracker report highlights why City of Yes zoning reforms are crucial to making the city more affordable.
City of Yes is the major housing push from Mayor Eric Adams' administration. It aims to build "a little more housing in every neighborhood" through zoning changes such as eliminating parking space requirements for new developments and legalizing small backyard and garage apartments.
The City Council has also attempted to address this type of disparity through its fair housing framework, which Adams signed into law in December. It creates five-year production targets for each of the 59 community districts in the city but does not include any enforcement mechanism, which could sharply limit its impact.
The overall number of affordable homes built in 2023 was the highest for the city in recent decades, and more than half were constructed using the now-expired 421-a affordable housing tax benefit, according to the report. The state replaced that program with a new tax break, 485-x, in this year's budget, although many in the real estate industry have criticized it for not being as effective as 421-a.
A separate report released Thursday focused on the economic costs of New York City's decades-long trend of underbuilding housing.
The city loses out on as much as $1.9 billion in tax revenue each year as a consequence of its undersupply, according to the study by the Citizens Budget Commission. The watchdog group based that metric on previous studies that found underbuilding reduces the national gross domestic product by 2% each year.
The affordability crisis has contributed to a well-documented pattern of outmigration, with a net 160,000 people departing the city in 2022, according to the Census Bureau. That population loss cost the city about $309 million in income and sales tax revenue in 2022, according to the budget commission's estimates, which reflects the fact that higher-income households—ones that make more than $109,000 per year—were more likely to leave.
And the housing shortage has taken a toll on the day-to-day quality of life of city residents. New Yorkers move less frequently than other Americans. According to the census, the city's turnover rate for rental units is 41% lower than the national average, limiting options for people searching for new homes. It also contributes to poor living conditions, the CBC report says, with 25% of city households considered overcrowded, defined by the census as having at least 1.5 people per room. (That rate is double the national average for renters.)
"New York needs to build more housing, both to address New Yorkers' immediate existing needs and to spur future growth," wrote Sean Campion, the report's author and the director of housing and economic development studies for the budget commission. "The past underproduction failure results in New York not meeting the need nor capitalizing on its potential."
Big swings in Nvidia shares have reignited debate about the staying power of the chipmaker’s rally. While the stock’s valuation and threat of competition are major concerns, one variable is key: durability of demand.
For more than a year, Nvidia’s customers have been snatching up all of the AI accelerator chips the company can produce. That fueled a doubling in Nvidia’s revenue in its last fiscal year to $61 billion and sales are projected to nearly double again in the current period.
To bullish investors, that spending is only just beginning as more companies seek ways to utilize artificial intelligence to help expand their businesses, create new products and improve efficiency. Nvidia’s resulting revenue and profit growth in that scenario would power the stock higher.
For bears, there’s still plenty of uncertainty about whether AI can live up to the hype and start delivering sufficient returns on investment. If not, demand is destined to cool and lead to a reckoning for Nvidia’s lofty valuation, which at 22 times projected sales is the most expensive in the S&P 500 Index.
It’s that scenario which Michael Kirkbride, partner and portfolio manager at Evercore Wealth Management, says is his biggest fear about Nvidia, even though he remains bullish on the stock.
“The longer term risk for all of this — and this is a multi-year risk — is that AI turns out to be a bust,” he said. “If AI turns out to be not the next internet and turns out to be the next telco, this will be a lot of ill money spent.”
Kirkbride is referring to the costly build-out of telecommunications networks in the 1990s in anticipation of a rapid internet traffic increase, which ultimately materialized at a much slower pace. Heavy spending and overly optimistic projections helped propel stocks like Cisco Systems to levels it still hasn’t surpassed more than two decades later.
Investors got a taste of what a reckoning for Nvidia shares might look like when the chipmaker, seemingly out of the blue, plunged 13% over the span of just three days, erasing $430 billion in market value. The shares snapped back on Tuesday and after edging higher again on Wednesday, have recouped about half their losses from the selloff. Nvidia shares fell 1.3% on Thursday after results from fellow chipmaker Micron Technology underlined how AI-related expectations have in some cases proved to be excessive.
Nvidia’s biggest customers — Microsoft, Meta Platforms, Amazon and Alphabet — have collectively plowed more than $150 billion into capital expenditures in the past four quarters. A big chunk of that is going to Nvidia, which dominates the market for chips that do the heavy lifting in AI computing.
Not only have those companies pledged to keep buying this year, many of them say they plan to spend even more.
For Steve Eisman, the Neuberger Berman senior portfolio manager who correctly bet against subprime mortgages before the 2008 financial crisis, that spending outlook gives Nvidia shares plenty of runway to keep rallying.
D.A. Davidson’s Gil Luria is less certain. One of the few analysts on Wall Street with a hold rating on Nvidia, Luria acknowledges that cloud services providers like Microsoft and Amazon are likely to remain “insatiable” for the next year or two but after that he sees more uncertainty.
“Those customers will have to deliver a very significant return on investment to justify more data center equipment and data center spending,” Luria said. “Until that happens the expectations for Nvidia for 2026 and beyond look very, very ambitious,” he added, noting that so far, their returns are paltry in comparison to spending.
John Belton, a portfolio manager at Gabelli Funds, acknowledges that insufficient return on investment from customers could become a problem for Nvidia down the road, but he sees no reason to bail on the stock now.
“We are cognizant of the long-term dynamics and we do monitor them, but we’re not going to sell a name with such strong fundamental momentum, where we think things are going to get even better in the near term.”
In the last days of the state legislative session, a majority of Albany lawmakers stood with New York families and defended their wallets by ensuring the misnamed “Packaging Reduction and Recycling Infrastructure Act” did not make it to Governor Kathy Hochul’s desk.
Oftentimes, lawmakers are praised for passing legislation. Today, we should applaud them for stopping it.
New Yorkers can rest assured that access to their favorite foods, drinks, and goods will not be compromised due to new, overbearing government regulations. Had this bill been passed and signed, prices would have skyrocketed, products would have come off the shelves, and technology that supports recycling would have been banned.
While the broader goal may have been admirable because all sides support sustainability, the proposed approach would have had more unintended negative consequences than benefits. Take prices, for example. New York families are already being squeezed out of every nickel and dime just to get by and face the highest tax burden in the country, leading to many residents and businesses fleeing the state. This bill would have increased costs even further at a time when inflation is still at record highs, hurting every family’s bottom line.
It would have been harmful to job creators had this bill come to pass. Some of the most well-known companies with facilities in New York would be forced to reduce their supply or, worse, pull out of the state due to overbearing new packaging requirements. Farmers would have been penalized and hit with higher fees that would have inevitably trickled down to the consumer. Imagine going down the grocery aisle and realizing your favorite foods are no longer sold in the Empire State. Prices would skyrocket for other brands because of fewer choices.
What’s just as devastating is the financial burden that would have disproportionately impacted disadvantaged families who rely on SNAP, as the misnamed bill would effectively ban access to food sold in flexible or convenience packaging–common in many SNAP goods.
We all want to build a more sustainable future. The consumer packaged goods (CPG) industry has already, and voluntarily, been investing in more sustainable products and setting ambitious targets to better the health of our planet. Our goal is to create a circular economy for packaging. However, the current U.S. system struggles to create the volume of quality recycled material needed to fulfill recycled content goals.
Material-to-material molecular recycling is a key piece of the solution. This technology enables plastic waste to be processed back into virgin-grade durable, refillable, or reusable applications — and allows our companies to create better packaging solutions with a lower environmental impact. Yet, this bill would have banned advanced recycling, which would hinder these packaging innovations and stunt the incredible progress we’ve made toward a more circular economy.
New government regulations, even if well-intentioned, are often unnecessary and prohibit companies from being able to create products successfully and do business, especially in New York. At least 158 companies have already left the state because of burdensome regulations – we don’t need to lose any more. It is crucial for policymakers to carefully consider the economic implications of their proposals and strive for a balanced solution that benefits all stakeholders.
The CPG industry stands ready to work with Albany lawmakers and those across the country to build a more sustainable and circular economy that protects consumers, spurs innovation and facilitates job growth. Laws for the sake of legislating come at a price, and New Yorkers deserve better.
New York Assembly: thank you for standing up for New Yorkers. There’s a better way to support sustainability without hurting consumers.
Mike Durant the president & CEO of the Food Industry Alliance of New York. John Hewitt is the vice president of packaging sustainability and head of state affairs with the Consumer Brands Association.
Roberta Kaplan, the veteran trial lawyer who represented writer E. Jean Carroll in her landmark lawsuits against Donald Trump, is leaving the firm she founded seven years ago to start a new outfit with a trio of close friends.
The litigator is departing Kaplan Hecker & Fink to start a boutique that will focus on civil litigation, internal corporate investigations and strategic advisory, she said Wednesday in a statement. Tim Martin, another Kaplan Hecker & Fink partner, is leaving with her. The new firm will be called Kaplan Martin.
Kaplan Hecker & Fink’s unexpected growth to more than 100 lawyers and staff nudged Kaplan to make a change, she said, just three years after she and her colleagues celebrated the opening of an expanded office at the Empire State Building. She also said she wants to focus less on white collar matters, now a focus at her old firm.
“It’s really that the firm grew rapidly, which is great, but it grew in size and complexity beyond what I had in mind and I wanted to get back to something nimbler,” Kaplan said in an interview.
Kaplan, who won a landmark Supreme Court victory for same-sex couples in 2013, rose to further prominence through Carroll’s lawsuits against Trump. Carroll in 2019 went public with her claim that Trump raped her in a department store dressing room in the 1990s, and then sued him for defamation after he called her a liar. Then she sued Trump for sexual abuse when New York temporarily lifted the statute of limitations on such claims.
Kaplan won both cases. A federal jury in Manhattan found Trump liable for sexual abuse and ordered him to pay Carroll $5 million. Another New York jury found Trump liable for defamation and awarded Carroll $83.3 million. Trump has appealed both verdicts.
The move will test Kaplan’s ability to bring her clients with her — again. She said all of her clients, with one exception, followed her when she left Paul, Weiss, Rifkind, Wharton & Garrison, the large firm where she worked for 25 years, to co-found Kaplan Hecker & Fink in 2017.
Along with Kaplan and Martin, the firm’s two other founding partners are Steven M. Cohen and Mitra Hormozi, both of whom are former federal prosecutors with close ties to Andrew Cuomo, the ex-governor who left office under a cloud of sexual harassment claims.
Cohen and Martin both served as general counsel at Ronald Perelman’s investment vehicle MacAndrew & Forbes Holdings and worked closely together while at the firm. Hormozi was general counsel at Revlon, where MacAndrew & Forbes was the largest shareholder before the cosmetic company’s 2022 bankruptcy. She made more than $752,400 as a director last year at Apollo Global Management.
Cohen was secretary to Cuomo when he was governor and served as counselor and chief of staff to when Cuomo was the state’s attorney general. Cuomo appointed Hormozi in 2011 to chair the Commission on Public Integrity, which looked into ethics violations by public officials and lobbyists.
Kaplan’s own ties to Cuomo came back to bite her during the former governor’s harassment scandal. She stepped down from Time’s Up, a group supporting victims of sexual harassment, in 2021 after a state investigation revealed her role in helping Cuomo fight off harassment allegations.
In addition to her suits against the former president, she sued a group of White supremacists who rioted in Charlottesville, Virginia, a case she won at trial. She represented the Center for Countering Digital Hate after the nonprofit was sued by Elon Musk’s X Corp. over a report saying the social media platform once known as Twitter “is overwhelmed with harmful content.” Kaplan won dismissal of the case. Musk has appealed.
Not all of Kaplan’s suits against Trump have paid off. In 2018, she sued Trump, his company and three of his adult children on behalf of a small group of investors who claimed he lied in his pitches on "The Apprentice" for a multi-level marketing company. A judge denied Kaplan’s request for class-action status and threw out claims that kept the case in federal court.
In May, Columbia University hired Kaplan to defend it in a Jewish student’s lawsuit over the school’s handling of pro-Palestine protests on campus. Columbia in June agreed to appoint a liaison over its Public Safety Escort Program through the end of the year as part of a settlement of the proposed class action.
Cohen said he will remain a member of Blue Raven, a legal advisory services firm he launched in 2020 after leaving MacAndrews. It will be integrated into the firm as a separate arm best suited for consulting independent directors of public companies.
A Boston-based nonprofit determined to break down hiring barriers and expand access for diverse early career tech workers has brought its ambitious fellowship program to New York.
Hack.Diversity was founded well before corporate diversity, equity and inclusion efforts received a shot in the arm in 2020. The non-profit launched in 2016 at the hands of Jody Rose, president of the New England Venture Capital Association, and Jeff Bussgang, a general partner at Massachusetts-based Flybridge Capital.
The vision: Partner with big-name tech employers to bridge the gap between corporate America and early-career Black and Latinx workers. To do that, they created a nine-month fellowship program connecting aspiring technologists to their first internship. Since the launch, the program has paired more than 500 fellows with 50-plus tech-focused host companies. In 2023, the average pay for Hack interns was $37 per hour.
The program was initially focused on the Massachusetts market but expanded to New York last year. Hack's pilot New York cohort was comprised of 15 software engineering fellows, nearly 90% of whom were either Black or Latinx.
Past Hack fellows told Crain’s that the training element of the program was among the most fruitful. Tilon Bobb, for example, was a member of the 2023 Hack New York cohort. He had studied computer science at Brooklyn College and was well equipped to enter the workforce from a technical perspective, but he felt the skills he learned in school did not fully set him up for the practical aspect of finding a job in tech after graduation.
"College prepares you for the theoretical aspect of computer science, but not the realistic approach of getting into these careers as a software engineer or web developer," he said. "I was the first person in my family to even pursue this kind of career. There was no roadmap."
Then he found Hack. As a fellow, he received professional development training and industry exposure that ultimately landed him an internship at food-tech firm ezCater. "They broke it down to a science so that you can be as successful as possible with these interviews."
Hack estimates it raises about $2 million in individual contributions and grants each year, its biggest donors being the Barr Foundation, the Chan Zuckerberg Initiative, Clara Wu Tsai Social Justice Fund, Schooner Foundation and the Linde Family Foundation.
This year, Hack received more than 1,000 applicants, about 100 of whom were admitted to the program. The New York-specific cohort welcomed 17 fellows.
As 2024 fellows now enter the summer months, they have already gone through extensive Hack workplace training programs and are beginning internships at about 25 host companies, including Amazon Web Services, Bain & Company, Liberty Mutual Insurance, Moderna, Wayfair and more.
The program is also adding more New York companies to its partnership list. This year, Midtown-based data platform provider MongoDB joined the cohort of host companies, as did media giant Bloomberg.
A two-pronged approach to breaking barriers
As for what Hack adds to the hiring process, the 18-employee team looks under the hood of DEI initiatives to identify and alleviate the systemic handcuffs hindering long-term diversity successes. In their eyes, firms may be hiring diverse talent, but they are doing it without first implementing the structures necessary for early-career employees to actually succeed.
The challenges, as they see it, are twofold. Inhibitors to long-term success lay both on the side of the employer and the employee. Hack's solutions, therefore, are twofold, too.
First, the nonprofit works with host companies to reimagine their approach to hiring new talent. "DEI was done so wrong with the best intentions," De La Isla, who previously served as the mayor of Topeka, Kansas, told Crain's. "(Companies) end up doing these mass hires and they don't have the culture or the organization ready to receive new talent that has never been in the corporate world before."
"If they're really trying to bring in new talent, they're going to need some support, because they don't know what we know," she added. "Our expertise is supporting our fellows and knowing what they need to be successful."
She believes many employers are plagued by discriminatory practices even at the earliest stages of the process. Applicants are often prematurely filtered out because they did not attend a four-year university, for example, or interview exams do not correlate to the actual job at hand.
"The practical functions of the job might be very different from the tech evaluation or tech interview that folks are being taken through," said Angela Liu, Hack's chief of strategy and growth. The program challenges hiring teams to rethink those processes. "We want companies to evaluate people from an asset-based lens."
That continues even after a team is assembled. In De La Isla's telling, even the best-intentioned businesses lack the skills and expertise necessary to go-it-alone in welcoming fresh talent into the corporate world. Hack works throughout the cycle to help managers at host companies become more inclusive leaders.
The second focus for Hack is on teaching soon-to-be interns of these companies the basics of business they need to know before arriving for work. That's why the program begins in January and spans nine months, despite the internships themselves occurring in the summer.
In the period leading up to internship season, Hack welcomes mentees into something of a Business 101 crash-course targeted specifically at breaking down barriers for first-time corporate employees.
"We work for five months straight from January all the way up through May, until the fellows get paired with an internship, supporting them to understand all of the intricacies of being in a work environment," De La Isla explained. Curriculum includes "how to receive feedback, how to give feedback to your supervisor, how do you write your resume? Once you start making money, how do you actually save that money? How do you show up at work? How do you have sticky conversations and stand up for yourself in a way that is respectful?"
"These things may seem very normal and like common things to know, but for our fellows who have never been in this work environment, they are absolutely new," she added. "They've never been in a corporate environment and don't know what the expectations are."
Bobb is a prime example of a Hack success story, of which there are hundreds. Not only did he land an internship through the program, he said ezCater offered him a full-time job to return. And while he ultimately opted to go a different route to pursue a more AI-focused role, Bobb credits Hack with getting him to where he is now.
"The support and the after effects of Hack.Diversity never stop," he said. "Hack projected me into getting my foot in the door in other places where I could work up."
I will admit to being a major skeptic of office-to-residential conversions when the idea first gained prominence right after the pandemic began. It just seemed like one of those concepts that was too perfect and simple in theory to work in practice.
Yes, the city is facing a huge surplus of offices and a major shortage of housing, but the idea that you could get rid of both problems in one fell swoop by turning empty offices into rentable apartments glossed over issues ranging from construction costs to where in the city people want to live. It seemed like the kind of idea political leaders would latch onto because it sounds exciting, not because it would actually solve a core problem. Think of it like, say, trying to deal with the region's transportation issues by proposing a fancy streetcar running along the Brooklyn-Queens waterfront.
The concept still seems unlikely to be a complete fix for the city's housing woes, especially given the problems they have faced elsewhere. During a panel discussion at the National Association of Real Estate Editors annual conference, Southern and West Coast developers and architects said that turning office buildings into residential ones tends to cost more than demolishing an office building and starting over, making the idea fairly impractical. It has reached the point where they are now more focused on converting malls, which predate offices as real estate's problem child by several years.
But New York exceptionalism already exists on issues ranging from pizza quality to bagel quality to pizza bagel quality, so why not add office-to-residential conversions to the list? Thanks to an incentive program in this year's state budget and a general eagerness among developers to get on board, conversions are starting to look much likelier now than in 2020 to at least make a dent in the city's twin housing and office-vacancy crises. And they can't start a moment too soon.
The housing deal in this year's state budget was the type of compromise that left basically everyone dissatisfied, but the office-to-residential conversion tax incentive was one of the few elements real estate organizations praised. SL Green CEO Marc Holliday said shortly after the state reached its budget deal that his firm would be one of the first to take advantage of the program by converting 750 Third Ave. into a residential building, while development giants including Silverstein Properties and GFP Real Estate had conversion plans in store well before the incentive program became law. And even skeptics of the program aren't necessarily skipping out on giving conversions a try, as developer Nathan Berman's plan to turn Midtown's former Pfizer headquarters into apartments shows.
This enthusiasm is a particularly stark contrast to the industry's reaction to the budget's other supposed boon to developers, a replacement program for the expired affordable housing tax break 421-a. The responses here have ranged from mild criticism to project cancellation.
Developers are not known for holding their tongues on government policies, and the response so far to the conversion incentive bodes well for the level of interest in it. The fact that companies get bigger tax breaks the earlier they start gives them another reason to launch these projects sooner rather than later.
A handful of six-figure leases have led to a few relatively strong months for the city's office market, but Manhattan is still grappling with close to 100 million square feet of available office space. Residential conversions won't take care of all of this. They probably won't even take care of most of it. But now that we've moved on from the "wouldn't it be cool" phase and into the "here's what type of tax policy will make it feasible" phase, the concept is looking a lot more realistic than it once did.
MEDICAID FRAUD: Manhattan U.S. Attorney Damian Williams reached a nearly $1 million settlement with nonprofit community health provider VNS Health over allegations that it fraudulently billed the Medicaid program for mental health services. Federal investigators alleged that VNS Health committed billing fraud within its Assertive Community Treatment program in Far Rockaway, a community-based outreach program for people with severe mental illnesses. The civil lawsuit claimed that the organization failed to provide or document mental health services for 103 patients between 2014 and 2018. The provider agreed to pay back the federal government and New York state to resolve the claims. "We are glad to put this matter behind us, as we continue to focus on providing the highest quality behavioral health services to New York’s most at-risk individuals," said Beatrice Santa-Wood, a spokeswoman for VNS Health.
HOSPITAL LAYOFFS: Mid-Hudson hospital system Garnet Health is planning to lay off 26 employees in an effort to improve its finances, according to a Tuesday report from Becker’s Hospital Review. The layoffs, which make up roughly 1% of the health system’s total workforce, are an attempt to save $4.6 million in salaries and benefits; they follow the previous termination of 49 workers last summer. Garnet Health Medical Center in Middletown, one of the system’s three hospitals, has operated in the red in the years following the pandemic, spurring administrators to come up with a restructuring plan. Garnet Health did not respond to multiple requests for comment from Crain’s on Wednesday.
RECOVERY SERVICES: The city’s Department of Health and Mental Hygiene issued a $14 million contract to a Woodside mental health provider to offer recovery and care coordination to people with severe mental illnesses, according to a notice in the City Record Wednesday. The organization, Mental Health Providers of Western Queens, will contract with the city through June of 2033 to provide rehabilitation, treatment and care navigation to people with mental health and substance use disorders.
A Union Square biotech launched with $142 million in seed funds to use artificial intelligence to build proteins – a process the firm says simulates 500 million years of natural evolution.
EvolutionaryScale, founded by three ex-Meta AI researchers, closed a seed round Tuesday led by former Github CEO Nat Friedman, Daniel Gross and Lux Capital. The biotech company is also backed by tech giants including Amazon and Nvidia.
The firm is a part of a wave of companies aiming to use AI to help scientists develop new medicines or reduce air pollution. But EvolutionaryScale has developed an AI model that it says can create the fundamental building blocks for new drugs or environmental technologies: proteins.
Proteins are the basic structure of most biological processes, and include molecules like hemoglobin, which carries oxygen throughout the blood, and insulin. While developing new proteins can take millions of years of evolution in the natural world, EvolutionaryScale says its new AI technology can speed up the process.
The firm launched its open-source AI model, known as ESM3, which was trained to understand and generate proteins using a dataset of 2.7 billion molecules from natural organisms, ranging from microbes in soils to viruses. That technology successfully created a new variant of green fluorescent protein found in jellyfish and coral reefs, according to a preliminary study released by the company this week.
The open-source AI model is now available to other researchers to build proteins that could lead to new drug development or environmental science breakthroughs like carbon capture, the company says. But EvolutionaryScale also has a larger AI model that it plans to sell to other firms, including drug companies. The firm already partners with Amazon Web Services and Nvidia for commercial uses, a spokesperson said.
EvolutionaryScale will use its seed round to develop larger AI models and grow its staff, according to the spokesperson. The firm currently employs 20 people.
EvolutionaryScale’s recent funding round follows $40 million in seed financing raised by the company in August, bringing the company’s total financing to $182 million, according to data from PitchBook.
Rupert Murdoch’s triplex penthouse has slashed its asking price yet again.
After listing for $62 million in 2022, the roughly 7,000-square-foot apartment in the Flatiron District has been on and off the market with increasingly diminishing price tags. Most recently, it was offered in April for $38.5 million. Now, the billionaire News Corp. chairman emeritus has lopped off another $10 million — all told, its $28.5 million price is now less than half of the initial ask.
“My client is a realist, and he is very astute about how markets function,” says Kyle Blackmon, the head of luxury sales at Compass who represents the property. Of the most recent drop, he continues, “We ultimately believe that such a significant reduction — 26% — increases the probability of competitive bidding.”
The apartment has been toured by what Blackmon says are 12 qualified buyers in the last two months, “five of which are billionaires,” he says. “We have a number of those qualified purchasers circling the property.”
The penthouse spans the building’s 58th, 59th and 60th floors, and has 5 bedrooms and 6.5 baths. There’s a private, internal elevator, along with a dramatic circular staircase.
A decade ago, Murdoch reportedly paid about $57.9 million for the apartment, along with a smaller 3,300-square-foot unit in the same building.
“In my experience, incremental and modest reductions traditionally are not enough to move the needle,” Blackmon says of the most recent price cut. “I have confidence that we’ve increased our probability of having multiple bids at this level.”
June is Pride Month, and Crain’s is celebrating by spotlighting trailblazers in sectors ranging from finance and health to sustainability and law. The individuals on the Notable LGBTQ+ Leaders list were selected not only because they excel in their respective fields but also for their commitment to creating inclusive and equitable workplaces.
Here are four LGBTQ+ health care leaders who are inspiring future generations. Read the full list of notables here.
Erin Drinkwater, Chief of government relations and strategic partnerships, MetroPlusHealth
Scope of work: Erin Drinkwater is chief of government relations and strategic partnerships at MetroPlusHealth, a health insurance plan mainly serving New Yorkers through government-sponsored programs. She helps evolve government relations strategies and ensure access to quality affordable health care.
Biggest professional win: Drinkwater spearheaded the creation of MetroPlusHealth's government affairs and strategic partnerships office. She has championed legislative initiatives, fostered community alliances, orchestrated collaborations with various governmental agencies and negotiated dozens of bills to reduce bureaucratic burdens and increase access to benefits.
Other contributions: Drinkwater sits on the board of managers of Fairview Lake YMCA Camps and has been a member of Lambda Independent Democrats since 2006, serving as their president in 2012.
Arthur Fitting, LGBTQ+ program manager, VNS Health
Scope of work: Arthur Fitting is LGBTQ+ program manager at the home and community-based nonprofit VNS Health. He promotes culturally sensitive home care to thousands of New Yorkers and ensures that employees receive LGBTQ+ training. Fitting is also a member of the New York State Department of Health’s health equity council.
Biggest professional win: Fitting helped lead a project with the VNS Health Research Center and community organizations that has studied the lived experiences of aging LGBTQ+ New Yorkers, conducted focus groups and analyzed the data to address gaps in care.
Other contributions: Fitting has volunteered and been involved with organizations including the Gay-Lesbian Medical Association, the American Nurses Association and the NYC LGBT Community Center.
Scott Freeswick, Vice President and chief pharmacy officer, Memorial Sloan Kettering Cancer Center
Scope of work: Scott Freeswick oversees the pharmacy department at Memorial Sloan Kettering Cancer Center, a cancer treatment and research institution that includes more than 600 employees working across 17 licensed pharmacies. He is also the executive sponsor of MSK’s LGBTQ+ Pride employee resource network.
Biggest professional win: During pandemic drug shortages, Freeswick quickly created a dashboard to predict usage rates and projected increase in patient volume. This data was then used to maintain an adequate drug supply and ensure reliable patient treatment.
Other contributions: Freeswick has been a volunteer member of The New York Blood Center’s institutional review board since 2005, ensuring ethical standards and regulations are met in research.
Leslie Gordon, President and chief executive, Food Bank for New York City
Scope of work: Since Leslie Gordon assumed her position of president and chief executive officer of Food Bank For New York City, the hunger-relief nonprofit’s annual food output has nearly doubled to almost 150 million pounds.
Biggest professional win: Assuming her position during the pandemic, Gordon leveraged a diverse set of expertise across all business units in immediate response to the historically outsized need for food. While developing trust among a new team, she helped to increase the amount of food distributed and to build culture, talent, processes and support for the future.
Other contributions: Gordon serves as board director chair for the nonprofit Feeding New York State.
The MTA is preparing to scrap more than $16 billion worth of upgrades to the region’s mass transit network after an indefinite pause on congestion pricing by Gov. Kathy Hochul.
Transit officials detailed the bleak consequences of halting the tolling program without a revenue replacement Wednesday at the MTA’s monthly board meeting: Sweeping cuts to expansion projects, a halt on signal modernization for more reliable service and accessibility upgrades halted at subway stations across the boroughs, among many other evaporating improvements.
The MTA says it has little choice but to take a hatchet to the remaining projects in its capital plan. The deferred investments include:
- $5 billion in system expansion projects, including an extension of the Second Avenue subway line from 96th Street on the Upper East Side to 125th Street in Harlem.
- $2 billion in accessibility projects, including at stations in all five boroughs and the potential cancellation of accessible work at the Forrest Hills and Hollis, Queens stations on the Long Island Rail Road.
- Elevator projects and other accessibility improvements at 23 subway stations: 42nd Street-Bryant Park, 5th Avenue, 7th Avenue, Lexington Avenue-59th Street, Delancey Street-Essex Street, 110th Street, 3rd Avenue-138th Street, Brook Avenue, 145th Street and 168th Street in Manhattan; Jefferson Street, Nostrand Avenue, Hoyt-Schermerhorn, 18th Avenue, Kings Highway, and Neptune Avenue in Brooklyn; Briarwood and Parson Boulevard in Queens; Wakefield-241st Street in The Bronx; and the Clifton station on the Staten Island Railway.
- $3 billion in signal modernization upgrades to replace 1930s-era equipment to run more reliable, frequent subway service on parts of the A, C, B, D, F and M lines.
- $3 billion in maintenance work, including projects set to refurbish five subway stations, which the MTA has yet to identify.
- $1.5 billion in 437 new subway cars, and new commuter rail cars,and $500 million in electric buses.
- $1.5 billion in infrastructure and technology upgrades across the MTA’s networks, including cable and ramp upgrades on the Verrazzano-Narrows Bridge and public announcement system upgrades at 70-plus stations for clearer communication.
“Plans are exactly that, they're a plan, and they have to respond to reality,” said Tim Mulligan, the MTA’s deputy chief development officer, during a presentation on the anticipated cuts. “Our reality for the capital program changed dramatically 21 days ago.”
Transit officials said they intend to redirect funds from the projects to fundamental maintenance that ensures a functional and safe system. Among those efforts are:
- Track repairs
- Tunnel work
- Power system upgrades
- A “select number” of new trains and buses to replace current dilapidated models, said Mulligan.
MTA board members Wednesday were visibly rattled by the scale of the proposed cuts, and during the meeting described the reductions as “dire” and “very disturbing.”
“This is catastrophic in many ways to me,” said MTA board member Norman Brown. “It’s very difficult to take.”
The board reluctantly voted Wednesday to formally put congestion pricing on indefinite pause.
The MTA’s board has yet to formally revise its current $55 billion capital plan, meaning these changes have yet to take effect. But without a restart to congestion pricing, or a revenue replacement, the MTA’s board is likely to advance the cuts in an attempt to balance its books.
Gov. Hochul says she intends to find an alternative revenue source for the MTA, but has not indicated where those funds would be drawn. State lawmakers have already rejected Hochul’s proposal to raise taxes on New York City-based businesses to cover some of the lost funding, along with a secondary Band-Aid that would have directed $1 billion out of the state’s general fund to the MTA.
“As we're heading in a slightly grim direction, I just want to emphasize one thing,” said MTA board chair and chief executive Janno Lieber. “Our obligation as fiduciaries and professionals is to work with everybody, however we feel at this moment, to try to be ready that when that financial solution that is being talked about arrives — God willing — that we will be ready to put Humpty Dumpty back together again as quickly as possible.”
Leases
AI firm takes space on Park Avenue South
Address: 315 Park Ave. South, Manhattan
Landlord: Columbia Property Trust
Tenant: Harvey
Lease size: 17,050 square feet
Asset type: Office
Brokers: Newmark’s David Falk, Peter Shimkin and Jonathan Fanuzzi represented the landlord, along with Maria Blake and Ted Koltis in-house. JLL’s Todd Stracci and Hugh Scott represented the tenant.
Architecture firm renews in Midtown
Address: 360 Lexington Ave., Manhattan
Landlord: Savanna
Tenant: Kenneth Park Architects
Lease size: 15,379 square feet
Asset type: Office
Brokers: CBRE’s Steve Eynon represented the tenant.
Vornado inks lease with biotech firm
Address: Penn 1, Manhattan
Landlord: Vornado Realty Trust
Tenant: LB Pharmaceuticals
Lease size: 8,906 square feet
Asset type: Office
Brokers: Josh Glick, Jared Silverman, Anthony Cugini and Jordan Donohue represented the landlord in-house. JLL’s Thomas Burrus represented the tenant.
Sales
Dalan Management unloads a pair of Upper West Side rentals
Addresses: 226 W. 97th St. and 2568 Broadway, Manhattan
Seller: Andy Wrublin
Buyer: Nathan Benelyahou
Sale price: $42.8 million
Asset type: Mixed use
Janus Hotels unloads Hudson River Hotel near Hudson Yards
Address: 442 W. 36th St., Manhattan
Seller: Michael Nanosky
Buyer: Shashin Gandhi
Sale price: $18.2 million
Asset type: Hospitality
Financings
New 138-unit rental building in Clinton Hill refinances loan
Address: 230 Classon Ave., Brooklyn
Owner: Quinlan Development Group
Lender: QuadReal
Loan amount: $56 million
Asset type: Multifamily
Brokers: Cushman & Wakefield’s Gideon Gil, Zach Kraft and Sebastian Sanchez represented the owner.
The MTA’s board voted Wednesday to indefinitely pause the implementation of congestion pricing tolls, formalizing an eleventh-hour postponement announced by Gov. Kathy Hochul earlier this month and officially blowing a $15 billion hole in the authority’s capital budget.
In a 10-to-1 vote, the board at its monthly meeting advanced a resolution that hits the brakes on a long-awaited toll program that would have charged most motorists $15 to enter Manhattan below 60th Street to reduce traffic and raise funds to improve the region’s mass transit. The vote firmly shut the door on the MTA’s board possibly attempting to advance congestion pricing against Hochul’s wishes.
MTA board member David Mack, who voted against the tolling program in March, was the sole vote that sought to block the resolution, instead preferring a permanent halt on the program.
“The fact is the MTA, it’s just a reality, cannot start implementing congestion pricing without the New York State DOT sign off,” said a dour Janno Lieber, the board chair and chief executive of the MTA during the vote. “Others may litigate that very issue, if so, so be it, but we are right now where we are.”
As a result, MTA officials said Wednesday that without a replacement to anticipated toll revenue the authority must defer $16.5 billion worth of construction projects to modernize the region’s aging transit system, including a high-profile extension of the Second Avenue subway to Harlem, signal upgrades and new train cars, among many others. Stop-work orders have already gone out to some projects, sending the region’s contractors into a panic.
Tim Mulligan, the MTA’s deputy chief development officer, said the authority will have to prioritize essential maintenance and upgrades to keep the system functioning and defer less critical, but long sought, accessibility, expansion and modernization work.
“Our guiding principles for the last 21 days, as we've been going through this process, has been to maintain the safe and functional operation of the system,” said Mulligan as he detailed likely changes to the MTA’s capital program.
“There are things that make the system better for our customers and for operation,” Mulligan added, “but they aren't directly related to maintaining existing service in all cases, and so more deferrals [will happen] to projects that are from those categories."
On paper, New York’s 1st Congressional district reads like a winner for Democrats. For one, it’s home to more of them than registered Republicans. And its voters favor abortion access for women, care deeply about the environment and boast high levels of union membership.
Yet the Long Island district — spanning most of Suffolk County to the Hamptons — has eluded the grasp of Democrats for a decade. It’s a failure critics chalk up to the party’s inability to field a candidate appealing to independents, who make up 30% of the electorate.
Nancy Goroff and John Avlon both believe they can solve that predicament. On Tuesday, the two contenders — with many similar policy proposals but starkly different backgrounds and personal styles — will face off in a primary over who is more electable.
The winner will try to win the House race in November against Republican Nick LaLota, a first-term incumbent and Navy veteran. It’s one of several contests in New York that could be competitive, with power over Congress hanging in the balance.
Elsewhere in New York, progressive “Squad” member Jamaal Bowman is embroiled in an acrimonious battle against challenger George Latimer for the 16th Congressional district, encompassing some parts of the Bronx and Westchester Counties. It has become one of the most expensive House primary contests in U.S. history.
And in New York’s 22nd Congressional district, near Syracuse, Democratic state Sen. John Mannion is fighting Dewitt Town Councilor Sarah Klee Hood to determine who will take on vulnerable first-term incumbent GOP Rep. Brandon Williams. It’s a battleground district that President Joe Biden won in 2020 by 12 points, and is seen as one of Democrats’ likeliest potential pickups in their effort to retake control of the House in November.
Bitter battle
In the 1st district, the Democratic establishment is lining up behind Avlon, 51, a journalist and CNN political analyst. His supporters say he has the bipartisan bona fides that will make him palatable to the district’s independent voters, who had helped Donald Trump win the areas currently included in the district by single digits in 2020.
Avlon is married to Margaret Hoover, conservative host of PBS’s "Firing Line"and great-granddaughter of Herbert Hoover. He’s a founder of the third-way political party “No Labels” who worked as a speechrighter in the administration of Republican Mayor Rudy Giuliani.
Goroff, meanwhile, is a 56-year-old researcher and former chair of the chemistry Department at SUNY Stony Brook who won the Democratic primary in 2020 but lost the general election after loaning her own campaign more than $1 million. She’s reprising her 2020 campaign, recycling her minimalist lawn signs and running ads with the tagline “mom, scientist, teacher.”
But despite Goroff’s deep roots in the district and previous candidacy, critics are painting her campaign as the quixotic quest of a wealthy candidate with virtually unlimited resources who is out of touch with the electorate and what it takes to win in November.
The Democrat, who reported assets between $11.5 million and $53.5 million to the House Ethics Committee, was formerly married to Glen Whitney, a mathematician and analyst at Long Island-based hedge fund Renaissance Technologies, and many of her donors have ties to the company.
“If we’re going to have a shot at making that seat competitive, we’re going to need a candidate that will appeal to moderates,” said New York State Democratic Party Chair Jay Jacobs, who is one of many elected officials, including current Reps. Tom Suozzi and Greg Meeks, who’ve endorsed Avlon.
Avlon has racked up a string of boldface donors since entering the race in February — actor Mark Hamill, who played Luke Skywalker in "Star Wars," and investor and venture capitalist Alan Patricof each held fundraisers for him the weekend before the primary.
Major names in media and finance have contributed to his campaign, including documentary filmmaker Ken Burns, former news anchor Connie Chung and NBA Commissioner Adam Silver.
In their argument against Goroff’s electability, Avlon supporters point to her ten-point loss to incumbent Republican Rep. Lee Zeldin in 2020.
“When you lose by ten, you don’t get to do it again,” Avlon said in an interview Monday.
“We have all the momentum and enthusiasm and endorsements heading into Election Day,” he said, noting the broad swath of elected Democrats and organized labor groups who have backed his candidacy, including four members of New York’s Congressional delegation and the influential New York State United Teachers union.
Negative ads
Goroff says she has a better shot of winning against LaLota than she did against Zeldin, and is wielding her personal wealth in an effort to prove it.
Avlon’s supporters are “assuming that a telegenic white guy is what we need to win elections,” Goroff said on a steamy Saturday the weekend before the primary, as she sat inside the small white wooden building that serves as Democratic party headquarters in East Setauket, home to both Renaissance Technologies and the SUNY Stony Brook campus where she spent most of her career.
“We have a lot of working people who are not necessarily excited about the TV guy from Manhattan,” Goroff said.
She has spent heavily on a barrage of negative television advertising, attacking Avlon over his past work for Giuliani and “No Labels,” and branding him as an outsider who “spent decades in Manhattan.”
That’s a potentially damaging line of attack in a district where tensions can run high between the wealthy Democrats who summer in the Hamptons and the unionized teachers and professors who live in the district year-round. (Avlon bought a home in Sag Harbor in 2017, and began living full time in the district only recently).
Goroff has loaned her current campaign $1.2 million, and touts endorsements from 15 elected officials and candidates, each of whom have received campaign donations from her.
In recent weeks, Avlon’s campaign has accused Goroff of trying to buy the primary outright. In a 30-second television ad titled “Negative Nancy,” Bridget Fleming, who won the Democratic primary in 2022 but lost to LaLota and has since endorsed Avlon, describes Goroff’s negative advertising as “pathetic and sad.”
“Avlon brings a lot to the table — he’s created a buzz, he’s gotten a bushel of boldfaced endorsements and he’s raised a lot of outside money which indicates that smart political people, or those at least with deep pockets, are interested in him and maybe even believe in him,” said Larry Levy, Executive Dean of the National Center for Suburban Studies at Hofstra University.
“By the same token, this is a district where outsiders have never done well,” Levy said, noting that the last Democrat who held the seat, former Representative Tim Bishop, was, like Goroff, an academic whose family had lived in the district for generations.
June is Pride Month, and Crain’s is celebrating by spotlighting trailblazers in sectors ranging from finance and health to sustainability and law. The individuals on the Notable LGBTQIA+ Leaders list were selected not only because they excel in their respective fields but also for their commitment to creating inclusive and equitable workplaces.
Here are four LGBTQIA+ health care leaders who are inspiring future generations. Read the full list of notables here.
Troy Boyle, Senior vice president of care management, Institute for Community LivingScope of work: Troy Boyle is senior vice president of care management at the Institute for Community Living, a behavioral health nonprofit. In this role, he oversees health home programs and provides housing, support and behavioral health services to those suffering from HIV or mental health challenges.
Biggest professional win: Boyle led the Institute for Community Living's launch of the $2.3 million pilot program “Step-Down Treatment Ensures Personal Success,” which offers programs for clients who have progressed in recovery and require less intense services.
Other contributions: Boyle provides pro bono trauma-informed counseling to uninsured LGBTQIA+ individuals and is also a board member of the nonprofit Wakeland Opportunities for Affordable Housing.
Sean Ebony Coleman, Founder and executive director, Destination TomorrowScope of work: Black trans political activist Sean Ebony Coleman is founder and executive director of Destination Tomorrow. The nonprofit works to improve access to gender-affirming programs and healthcare resources for LGBTQIA+ individuals. Coleman has helped raise $15 million, built relationships with local businesses and aided in delivering services including free HIV testing and PrEP referrals.
Biggest professional win: Coleman spearheads Gilead's TRANScend Community Impact fund, identifying and delivering hundreds of thousands of dollars to dozens of trans-led and trans-focused organizations.
Other contributions: In addition to his work helping LGBTQIA+ individuals at Destination Tomorrow, Coleman also previously worked with Bronx Borough President Vanessa Gibson on the LGBTQ Policy Task Force, which has developed various queer-affirming policies.
Stephen Covello, Chief philanthropy officer, God’s Love We DeliverScope of work: Stephen Covello is chief philanthropy officer at the charity God’s Love We Deliver. He maintains a portfolio of 400 donors and cultivates new ones into the network, which have resulted in $75 million in contributions.
Biggest professional win: Holding 13 years of experience in his position and a volunteer for eight months prior, Covello oversees strategic planning and operations of fundraising initiatives to secure capital.
Other contributions: Covello co-chairs the LGBTQ+ Philanthropy Roundtable, which aims to advance equity and justice in New York City. He has also been involved with various Food is Medicine Coalition organizations and led the philanthropy track of the coalition’s national symposium.
Elisa Crespo, Executive director, NewPride AgendaScope of work: Elisa Crespo is the executive director of New Pride Agenda, leading the organization in furthering the economic, health, racial and gender identity justice needs of marginalized LGBTQIA+ individuals in New York State. She works with elected officials and communities to educate allies and the general public about the legal protection and rights of LGBTQIA+ individuals.
Biggest professional win: Crespo partnered with Columbia University to create an LGBTQ Civic Engagement survey that shaped New Pride Agenda's priorities of public health, affordable housing, racial disparities and economic equity.
Other contributions: Crespo was recognized for her contributions to social change as listed in City and State’s New York City 2022 “40 under 40” list.
CRISIS RESPITE SERVICES: The New York City Department of Health and Mental Hygiene awarded a $9.5 million contract to the Riverdale Mental Health Association to operate a crisis respite center for individuals with severe mental illnesses, according to a notice in the City Record on Monday. The center will provide brief periods of mental health support for adults experiencing a psychiatric crisis as well as those who have co-occurring conditions such as substance use disorder. The contract will begin in July and extend through June 2033, city filings show.
HEALTH CARE WORKFORCE: Gov. Kathy Hochul announced $8 million in recurring funding to SUNY community colleges on Monday to train the incoming health care workforce. Of those funds, Hochul directed $5 million to help boost community college enrollment and completion of their health care education programs. The remaining $3 million will be used to expand mental health support for students, the governor’s office said. The funding is a part of Hochul’s effort to increase New York’s health care workforce by 20% over the next five years.
DANIEL’S LAW: The Daniel’s Law task force, a state panel created to evaluate behavioral health crisis response models that do not involve police, is scheduled to have a virtual meeting at 11 a.m. today, according to New York’s Office of Mental Health. The task force is set to hear presentations from city health and public safety officials on its crisis response system. Tune into the meeting here.
The United Federation of Teachers, one of the city’s largest unions, has rescinded its support for a long-disputed city proposal to transfer retired city employees to Medicare Advantage plans – a move that puts the plan in further jeopardy.
The city administration is pushing to transfer 250,000 retired workers from public health insurance to privatize Medicare Advantage plans as a cost-cutting strategy, which officials have said could save $600 million a year. That plan has benefited from the support of the Municipal Labor Committee, an organization made up of representatives from the city’s 102 unions that includes UFT. But UFT has more power than other unions in the consortium due to its large member base, and could sway the position of organized labor.
UFT president Michael Mulgrew announced the union’s decision to reverse its Medicare Advantage position in a Sunday letter to Harry Nespoli, chair of the Municipal Labor Committee. UFT also said it is withdrawing from negotiations for active city employees.
“It has become apparent that this administration is unwilling to continue this work in good faith,” Mulgrew wrote in the letter. “This administration has proven to be more interested in cutting its costs than honestly working with us to provide high-quality health care to city workers.”
While many unions have historically opposed the plan, key players have stopped short on reversing their own stances since UFT’s announcement. Henry Garrido, executive director of labor giant DC37, said in a statement that the union will “assess the impact of the UFT’s withdrawal from the process and determine next steps” with its partners in the Municipal Labor Committee.
“The very stark fact remains that health care for city workers and retirees needs to be funded, and absent a viable solution such as the one underway, those premium-free benefits are on the line,” Garrido said.
Nespoli, chair of the Municipal Labor Committee, did not respond to an inquiry from Crain’s on Monday.
UFT had backed the city’s plan to shift to Medicare Advantage since it was announced in 2018, because the union saw it as a way to devise an insurance plan that worked for its members and save money on health care, Mulgrew told Crain’s. But fierce opposition from retirees and legal challenges that have blocked Mayor Eric Adams’ administration from implementing the switch has left UFT with no choice but to change its stance, he said.
“The courts have spoken, our members have spoken,” Mulgrew said. “As a union leader, when your members speak you listen.”
The union’s change comes nearly a week after an opposition group won seats in a UFT retiree chapter election on a platform against Medicare Advantage.
The election upset is the latest example of widespread and growing concern about the Medicare Advantage plans. Retirees have repeatedly objected, stating that they would lose access to familiar doctors and end up paying more out-of-pocket.
Despite the opposition, Adams moved forward with the plan, signing a contract with the Hartford, Conn.-based insurance company Aetna last year that would have automatically enrolled retirees in Medicare Advantage. But the retirees filed a class-action lawsuit to block the shift, a request that was ultimately granted. An appeals court upheld the decision last month.
Judges said the city deviated from its promise to provide retired employees with traditional Medicare and a supplemental option. The court also said that the city’s argument wasn’t viable — a decision that doesn’t bode well for the future of the plan, Mulgrew said.
Despite the decision, the city is intent on appealing. The Adams administration is planning to ask the Court of Appeals to review the decision in the coming days, said Nicholas Paolucci, a spokesman for the city Law Department.
“We have been clear: The city's plan, which was negotiated closely with and supported by the Municipal Labor Committee, would improve upon retirees’ current plans and save $600 million annually,” Paolucci said. “This is particularly important at a time when we are already facing significant fiscal and economic challenges.”
But Jake Gardener, an attorney with Walden Macht & Haran who represents the retirees, said regardless of the legal challenge, it's not clear whether the city will succeed in bringing the Medicare Advantage proposal to fruition without the UFT’s support.
“UFT is one of the most powerful – if not the most powerful – union in the Municipal Labor Committee,” Gardener said. “Without the UFT’s support, I don't exactly know how it could support this Medicare Advantage plan.”
Gardener said he hopes the move by UFT “is the first of many dominoes to fall.”
The clock has started ticking on the city’s review of two major life sciences developments planned for Kips Bay, nearly two years after Mayor Eric Adams committed to building a life sciences hub in the neighborhood.
Dubbed the Science Park and Research Campus Kips Bay and Innovation East, the projects are expected to create a total of 1.5 million square feet of new life sciences space. They have advanced to the city’s public land-use review process, the Economic Development Corporation announced Monday. The move marks the beginning of the city’s formal review to establish a medical research and biotech center in Midtown East.
Both SPARC and Innovation East are a part of the city’s $1 billion LifeSci NYC Initiative, which has a goal of creating 10 million square feet of wet lab space in the city by 2030. The Adams administration has looked to growth in the life sciences sector to boost the city’s economy and compete with biotech hubs including Boston and San Francisco.
The mayor and Gov. Kathy Hochul announced SPARC Kips Bay in October 2022, estimating that the project would create 15,000 jobs and generate $42 billion in revenue in the coming decades. The $1.6 billion project is expected to span an entire city block at First Avenue and 25th Street, the site of Hunter College’s Brookdale campus. SPARC is intended to serve as an academic resource for New York City public high school and college students as well as a pipeline for future life sciences and health care workers.
Innovation East, which is planned for 455 First. Ave., is adjacent to that project. The commercial lab space and life sciences incubator is set to replace the city health department’s Public Health Laboratory, which will move to New York City Health + Hospitals/Harlem. Developers Taconic Partners and DivcoWest are spearheading the project.
Adams said in a statement that the city is looking forward “to receiving public feedback as we recommit ourselves to establishing New York City as the global destination for technology, innovation, and opportunity for generations to come.”
The people handpicked by Mayor Eric Adams to suggest changes to the New York City Charter say they are considering proposals that would undercut some of the City Council’s legislative authority, change rules for film permits and boost minority- and women-owned businesses.
The 13-person Charter Revision Commission on Monday released a preliminary report outlining a few of the ideas it may put to voters on the November ballot. The findings came after the commission held a round of public hearings and received testimony from hundreds of people. And it comes a month after Adams announced he was convening the panel in what some critics saw as a play to block the City Council from expanding its power through its own charter changes.
Indeed, some of the not-yet-final proposals might chip away at the autonomy of the council, which antagonized the mayor last year by overriding his veto of two public safety bills. The commission is floating the idea of requiring the council to slow down the legislative process before voting on bills that affect public safety — potentially by requiring “at least one additional public hearing” on the bill before a vote, the commission wrote.
In making the recommendation, the commission — chaired by Adams ally and New York Building Congress head Carlo Scissura — pointed to testimony it heard from leaders of officers’ unions like the Police Benevolent Association, and from anti-crime activist Yiatin Chu, who spoke against last year’s bill that required police officers to report more low-level stops.
The new reporting requirement is now in effect and being implemented by the NYPD.
“Applying additional requirements for input and review in the City Council’s consideration of public safety legislation could promote careful deliberation and ensure that affected communities across the city are heard when legislation touches upon this important area,” the commission wrote.
A few of the other proposals announced Monday involve “fiscal responsibility” — one of the commission’s other areas of focus. Heeding suggestions from watchdogs, the commission suggested strengthening the relatively flimsy fiscal impact statements that the City Council must release for each of its bills, potentially by requiring the analyses to be released earlier in the legislative process.
“The council typically publishes fiscal impact statements only when proposed legislation is on the cusp of adoption as a law,” commissioners noted in their report.
The commission also appears interested in the idea raised by fiscal watchdogs of curbing the council’s ability to pass laws with an impact on the city’s finances outside of the annual budget process. In its report, the charter commission floated a vaguely-worded proposal to “harmonize” the budget process with the legislative process.
The City Council had no immediate comment.
The commission will still hold another round of hearings before deciding which ideas make it onto the general election ballot, where they will be phrased as questions. Those proposals must be finalized by Aug. 5, and Scissura said in an interview that he aims to issue a final report within six weeks.
“This is the beginning of the next part of the process,” he said.
As for MWBEs, whom Mayor Adams has made a top priority, the commission suggested consolidating the city’s work with those businesses into a single new agency. As it stands, there is no one entity that has makes rules for how the city works with MWBEs or issues contracts to them, the commission noted.
Also on the commission’s agenda are permits for film shoots, which under the City Charter can only be granted by the Small Business Services Department, even as the mayor’s Office of Media and Entertainment handles much other work for the film business. The commission said it might suggest giving the mayor’s office the same permitting authority.
Monday’s report includes a few other wonky policy ideas concerning how the city budgets for its capital construction needs and issues permits for waterfront development.
City Comptroller Brad Lander criticized the commission’s initial ideas in a statement on Monday, saying the panel “swung and missed” by not including some of the proposals he had made — such as mandating contributions to the city’s Rainy Day Fund and on-time payments to nonprofit vendors.
“I’m glad that the commission will at least consider our proposal to modernize capital planning — but that must go along with action to ensure the affordability of the city’s debt, with long-term savings and efficiencies, and with procurement reform. Otherwise, it’s just for show.”
Other members of the Charter Revision Commission include Ruben Diaz Jr., a lobbyist and former Bronx borough president; Jackie Rowe-Adams, an anti-gun violence advocate and vocal supporter of the mayor; and Max Rose, the former Staten Island Congressman-turned lobbyist. The commission's second round of meetings is set to run through mid-July.
The panel’s focus on fiscal issues is seen in part as a response to a law passed by the council over Adams’ objections last year that expanded costly housing vouchers. In passing the expansion, the council seemed to pay little heed to its own forecast showing that the measure would cost $10 billion over five years.
Council Speaker Adrienne Adams has lately been trying to expand her body’s oversight of the mayor’s commissioner-level appointments, which would need to be ratified by voters in November. But the mayor’s commission has likely managed to knock the council proposal off this year’s ballot.
The MTA and law enforcement officials this month arrested 50 drivers and seized 192 vehicles from serial toll evaders who’ve amassed $1.5 million in unpaid fees using so-called “ghost” license plates that have numbers covered to block toll readers. The operation is part of an effort to claw back revenue following Gov. Kathy Hochul’s surprise move to stop the implementation of congestion pricing.
Transit officials, the NYPD and other law enforcement partners seized vehicles with ghost plates on June 14, 15 and 17 on six MTA bridges, including the Robert F. Kennedy, Willis Avenue and Third Avenue spans. The MTA revealed the details of the sweep on Sunday.
City and state officials have recently ramped up efforts to crack down on toll evaders in advance of the now-postponed June 30 implementation of congestion pricing, which would have charged most motorists $15 to enter Manhattan’s core.
During the operation officers issued 1,809 summonses and arrested 50 people, including Bronx resident Pedro Bonilla, 43. Officers tried to stop Bonilla, who was driving a motorcycle over the Third Avenue Bridge on June 15, but he attempted to speed off, lost control and collided into a parked vehicle. Bonilla was found in possession of a loaded 9 mm handgun and is a person of interest in a criminal case, the NYPD said.
Officials seized vehicles for a mix of violations including unpaid tolls, unregistered vehicles and suspended licenses, among other traffic infractions.
Mayor Eric Adams’ administration is looking for a corporate sponsor for the NYC Ferry system, a potential revenue source that could plug some holes for the money-losing nautical network.
A private company could pay to secure naming rights for the entire NYC Ferry system — including the system’s name, logo and the exteriors of its boats, according to plans outlined Monday by the city’s Economic Development Corp., which oversees the system. In a request for proposals published Monday, EDC announced it will hire a consultant to line up the potential “revenue-generating naming rights and sponsorship brand partnership.”
Launched in 2017 by then-Mayor Bill de Blasio, NYC Ferry has faced criticism for its financial losses. Taxpayers subsidized the system to the tune of $8.55 per ride last fiscal year, an improvement from $12.98 three years prior.
Now, EDC hopes the to-be-named consultant will start talking to potential sponsors later this year and negotiate a deal with a brand partner in 2025, according to details shared exclusively with Crain’s. In addition to renaming “NYC Ferry” itself, the RFP says the eventual sponsor could showcase its name on the system’s 38 boats, on the uniforms of employees, and on signage around the city.
The sponsorship idea was first raised in a 2022 Adams administration financial improvement plan known as NYC Ferry Forward. The most immediate consequence of that plan was raising the fare for a one-way ride from $2.75 to $4 for casual riders, while offering discounts for low-income, senior and disabled riders.
“With the release of the RFP to find an agency that will assist in securing a ferry sponsorship package, we are implementing another key element of Ferry Forward toward ensuring long-term financial stability for a service New Yorkers have come to love,” said Andrew Kimball, EDC’s president and CEO, in a statement.
Adams’ 2022 reforms were announced days after Comptroller Brad Lander released an audit that found shoddy oversight and mismanagement of NYC Ferry had cost taxpayers more than $200 million in underreported costs over six years.
The solicitation published Monday seeks a consultant to “refine the NYC Ferry brand positioning,” pitch the opportunity to sponsors, and ultimately help secure a multiyear naming-rights deal. The RFP has a July 25 deadline.
“NYC Ferry vessels are visible from over 100 miles of New York City waterfront for approximately 16 hours per day,” the RFP notes, in an enticement for potential sponsors. “NYC Ferry vessels operate in a low-clutter environment with limitations on alternative advertising/floating billboards or other aspects.”
Sean Campion, director of economic development studies for the watchdog Citizens Budget Commission, called the sponsorship plan a positive step for the beleaguered system. He noted that similar sponsorships have worked well for the Citi Bike system and the MTA, which receives $200,000 annually from Barclays to include its name in Brooklyn’s Atlantic Avenue station.
“Any option to raise revenue is good and will offset the need for the relatively high subsidy that NYC Ferry has needed since it was first created,” Campion said. But he added that sponsorship revenues would not necessarily substitute for the money EDC could get from raising fares even higher. (Campion’s group has called for raising the $4 fare to match the cost of an MTA Express Bus, currently $7.)
The city last year also signed a new five-year contract with Hornblower, the private company that has operated NYC Ferry from the start. The city will pay Hornblower up to $405 million, but only expects to take in $160 million in revenues from the ferry system, although EDC said the latest deal included new revenue-generating options and oversight on spending.
The ferry system has come under scrutiny for its disproportionate appeal to wealthy and white riders, despite having been designed as an equity-minded system capable of serving neighborhoods without other transit options. In 2023, just 35% of ferry riders identified as nonwhite or multiracial compared to 47% of residents in the neighborhoods close to ferry stops, according to the system's annual survey.
Since last year, NYC Ferry has inked more corporate sponsorships in hopes of both raising revenues and attracting riders, the publication Marketing Brew reported in February. Recent activations included inviting the Carvel ice cream mascot Fudgie the Whale to hand out free treats to Manhattan riders, and hosting a listening party for Taylor Swift’s new album on board an East River ferryboat.
A record 6.6 million rides were recorded on NYC Ferry in the last fiscal year. The system operated at a loss, racking up $78 million in operating expenses compared to $21.5 million in revenues. The system has seven routes, running mostly along the East River, including lines that run to Governors Island, Staten Island and the Rockaways.
Caroline Spivack contributed reporting.
Uber Technologies has begun locking New York City drivers out of its app during periods of low demand in an attempt to fight a minimum wage rule, and Lyft is threatening to do the same. As a result, some drivers say their wages have fallen by as much as 50%.
At the heart of the move, say the two companies, is a six-year-old pay rule in New York that, among other things, requires firms like Uber and Lyft to pay drivers for the idle time they rack up between rides. The lockouts, which began last month, are aimed at limiting how much non-passenger time drivers are able to log and be paid for. Drivers, meanwhile, say they need to work longer hours to earn the same amount as before.
The lockouts occur unpredictably, making it difficult for drivers to plan work shifts and treat Uber as a full-time job. Sometimes these episodes can last over an hour.
An Uber spokesperson said that access to the platform is based on rider demand at any given time and place. If demand drops too far below supply, the company will temporarily shut drivers out.
Nikoloz Tsulukidze, who drives full time for Uber, said that he has been getting shut out of the app four or five times a day.
“I used to work 10 hours and make $300 to $350,” Tsulukidze said. “Now, I just worked 10 hours and barely made $170. I was so disappointed. I’m paying for my gas and cannot make money.”
Wesly Dorsainvil, another full-time Uber driver, similarly said he used to take home between $300 and $400 per shift, but was lately seeing between $170 and a little over $200.
Uber “mismanaged” hiring by allowing a surplus of drivers onto the platform and is now punishing workers for it, said Bhairavi Desai, president of the New York Taxi Workers Alliance, which she said represents 28,000 professional drivers in the city. Uber froze new driver sign-ups in April 2023 “largely due to” the New York City Taxi and Limousine Commission’s pay rule, according to a statement on the company’s website. Would-be drivers now have to add their names to a waitlist.
In emails to drivers, Uber and Lyft have blamed each other — and the commission — for lockouts. In its minimum-pay formula, the TLC calculates non-passenger time as an industry average. When Lyft drivers aren’t as busy, for example, Uber has to increase driver pay because non-passenger time is higher on average.
“The city’s rule bizarrely holds Uber responsible for Lyft’s failures,” said Uber spokesperson Freddi Goldstein. “With Lyft struggling to keep drivers busy, we don’t have other options.”
Uber’s drivers have been busier than Lyft’s this year, TLC data shows. But Uber’s dominant market share in New York — nearly triple Lyft’s — means that its numbers have a stronger pull on the average.
In a May 16 email reviewed by Bloomberg, Uber urged its New York City drivers to “let the TLC know the effect their rules have had” on their ability to earn.
Uber is ultimately “gaming the system,” Desai said, by using a TLC regulation as an excuse to take “time that should be paid under the law and making it unpaid.”
Since Uber began telling drivers to lobby regulators for a rule change, Lyft has told its own drivers that “Uber wants to change the rules so that Lyft is penalized,” per a June 14 email reviewed by Bloomberg. In the email, Lyft announced that it, too, would soon “have to” begin temporary driver freezes.
“The current NYC pay formula is broken,” said Lyft spokesperson CJ Macklin. “It forces rideshare companies to limit when drivers can earn, and therefore how much they can earn,” he said, adding that the regulation favors Uber because the fact that its drivers appear to have less idle time weighs down the calculated minimum pay.
Macklin also said that Lyft has been advocating for TLC rule changes that would allow it to compete with Uber while still paying drivers fairly.
Desai said that the union would consider a strike if the lockouts continue.
The ride-hailing companies have often sparred over TLC regulations. In 2019, after the city attempted to implement a flat minimum pay rate equivalent to the minimum wage, Uber and Lyft engaged in a similar lockout war that continued until the Covid-19 pandemic began in spring 2020.
The two ride-hailing companies have also resisted regulation in other parts of the country. In March, Uber and Lyft threatened to stop serving Minneapolis after city officials attempted to implement a driver pay raise equivalent to the minimum wage. Both companies temporarily pulled out of Austin when the city sought to introduce driver fingerprinting rules in 2016.
Is another Democrat about to run against Mayor Eric Adams?
Reports indicate that Brad Lander, the city comptroller, is strongly considering taking on Adams in the Democratic primary next year. Lander has reportedly told donors he’s interested in a mayoral bid, and he’s retained top pollsters and consultants to guide him. For now, he’s mum, but this kind of news suggests he’s serious.
If Lander opens an exploratory committee, he will join two other Democrats, Scott Stringer and Zellnor Myrie, in taking a pivotal step toward running. Jumping in would be risky for Lander because he’d have to give up a second term as city comptroller to try his hand at beating Adams.
But the fact that Lander might be willing to do it — and enter what would be a bitter, racially polarized primary against the city’s second Black mayor — speaks to how little political capital Adams has left.
Polling has been relatively sparse, but Adams late last year notched the lowest approval rating by any mayor in a Quinnipiac poll since 1996. His administration has been buffeted by scandal and federal investigators continue to probe him and his allies. Eric Ulrich, his ex-Buildings commissioner, has already been indicted on corruption charges. Many in politics are waiting to see if Adams himself faces charges soon.
Beyond the corruption clouds, Adams has struggled to retain talented staff and manage the municipal government. He lost a police commissioner and his housing czar. Little in the way of ambitious policy gets done, and he has failed, unlike his predecessors, to formulate a coherent governing vision for the city. The exception might be his “City of Yes” rezoning proposal, largely being overseen by Dan Garodnick, the head of the Department of City Planning. Progressives, moderates and conservatives have all found reasons to dislike Adams.
Could Adams actually lose? The short answer is yes, even if it’s historically difficult to oust an incumbent mayor. Adams only managed to win the 2021 Democratic primary by fewer than 10,000 votes. Kathryn Garcia almost became mayor, and a large swath of the city also voted for Maya Wiley, the leading progressive candidate.
Lander, as a white progressive from Park Slope, can’t compete with Adams in the working-class Black and Latino neighborhoods of Brooklyn, Queens and the Bronx. He can’t outflank Adams with more conservative Asian voters or Orthodox Jews. Adams will be happy to deride Lander as an affluent, out-of-touch liberal from one of the city’s most expensive neighborhoods.
But Lander’s own brownstone Brooklyn base is vote-rich. Just as Adams can throttle him in central Brooklyn or Southeast Queens, Lander could run up huge margins in northern Brooklyn, western Queens and large parts of Manhattan. Lander beat a tough primary opponent in then-Council Speaker Corey Johnson to win his 2021 comptroller primary, and he’s an underrated political talent, able to forge coalitions among activist groups, labor unions and community organizations.
To win, Lander would need to pull large parts of Garcia and Wiley’s coalitions — something that is plausible if he wins endorsements from the New York Times editorial board, Alexandria Ocasio-Cortez and the Working Families Party. His overt progressivism could alienate moderates, but he’d also be well-positioned to make a technocratic pitch to voters: He is a genuine policy wonk who would take management of the municipal government seriously.
Lander offers less potential excitement than Myrie, a Brooklyn state senator who is just 37 and could make history as the city’s first Afro-Latino mayor. He might be less of a political brawler than Stringer, who has survived several tough primaries and can pull plenty of votes from his old West Side base. Ranked-choice voting makes this all less zero-sum: The anti-Adams voters can put Stringer, Myrie and Lander on their ballots.
Lander must be taken seriously because he can go toe-to-toe with Adams in fundraising — with public matching funds, he was able to spend more than $5 million on his 2021 race — and he’s very well-known in the college-educated stretches of Brooklyn that he represented in the City Council for 12 years. Adams might be able to counter with super-PAC spending, especially if real estate developers and powerful financiers like Steve Cohen decide Lander is too liberal to govern the city.
The wild card here remains Andrew Cuomo, the disgraced former governor. Cuomo is very hungry to get back in the game. He’s been visiting Black and Latino churches, penning op-eds and hoping for redemption. He’s a formidable contender if he gets in. Whether formidability is enough to actually win is another story entirely.
Ross Barkan is a journalist and author in New York City.
A Miami-based real estate investment firm has scooped up a NoMad hotel — part of global hospitality chain Sonder — for $47.8 million, according to a deed that appeared in the city register last week.
Azora Exan, which also has offices in Spain and maintains nearly $174 million in assets across seven properties in the five boroughs, has now added 1141 Broadway to its portfolio, records show.
The company bought the 10-story building, between West 26th and West 27th streets, from Manhattan-based firm Premiere Equities, whose headquarters at 1151 Broadway is just a stone's throw from the inn.
Yaron Jacobi, a founding partner at Premiere Equities, signed the deed on behalf of the seller. Jacobi and his business partner, Uzi Ben Abraham, bought the hotel in 2019 for $40.3 million, records show, netting them about $7 million in profits from the sale, although they had originally sought about $60 million.
Soon after purchasing the property about five years ago, Premiere Equities teamed up with the short-term rental company Sonder, which says it operates about 9,000 rooms in more than 40 cities across 10 different countries, to lease floors two through nine of the 10-floor Broadway building and rent them out to guests for short-term stays. Rooms this summer at the Sonder Flatiron, which lists its address as 9 W. 26th St. in the Flatiron District, go for around $250 to $350 per night, according to its website.
The building also has retail on the ground floor, including Israeli ice cream shop Anita Gelato and skin care company Malin + Goetz, as well as cocktail bar Apotheke Mixology on the roof. Premiere Equities did not respond to a request for comment about how much its tenants lease the retail space for, but a report from commercial broker JLL earlier this year shows that asking rents in nearby Flatiron and Union Square averaged $248 per square foot for the first quarter of 2024.
Azora's other assets in the city include residential buildings The Bergen at 316 Bergen St., 1 Boerum Place and 50 Orange St. in Brooklyn and 82 W. 12th St. in Manhattan; it also owns retail space 15 William in Manhattan.
An Azora representative, who declined to provide her name, told Crain's Monday that the firm plans to "buy and hold" the Broadway property, and any renovations would be done by the tenants, whom she said are expected to stay.
Sonder, which also did not respond to a request for comment by press time, brought in $161 million in revenue during the last quarter of 2023 and had a portfoliowide occupancy rate of 83%, according to its latest shareholder letter.
No Village Voice, no Village home.
Peter Barbey, a billionaire apparel mogul who led a failed effort to revive the storied Village Voice newspaper in the mid-2010s, is looking to say goodbye to the neighborhood in the publication’s name.
Barbey has listed his 4,000-square-foot duplex condo at 140 W. 12th St., No. PH8, in Greenwich Village for $32 million, according to an ad that appeared last week.
The holder of a major stake in VF Corp., a clothing and luggage conglomerate founded by his family in the 19th century whose products include Vans sneakers, JanSport backpacks and SmartWool socks, paid $26 million for the four-bedroom home in 2015, according to the city register. At that valuation, Barney could nab a more than 20% profit, though high-end sales for which the buyer paid the asking price or more have hardly been a sure thing.
The same year Barbey snapped up the penthouse, which comes with a storage unit, a parking space for a “large SUV” and 3,100 square feet of terraces in a building near Seventh Avenue, he also purchased the Voice with plans to inject new life into the struggling, decades-old publication.
Barbey was no stranger to periodicals. His great-great-grandfather and great-great-uncle founded the Reading Eagle of Reading, Pennsylvania—an English language reboot of an existing German paper—in 1868. Barbey served as CEO of the Eagle’s parent company at the time.
But after cycling through three editors-in-chief in three years at the Voice amid a harsh ad sales climate, Barbey in 2017 reduced the alternative weekly to a digital-only offering and a year later pulled the plug on its website, ending a prize-winning 63-year run.
The Eagle ran into financial problems too, and in 2019 Barbey filed for Chapter 11 bankruptcy protection for the paper, which MediaNews Group, a newspaper publisher and an affiliate of the hedge fund Alden Global Capital, later grabbed for $5 million.
Founded in 1955 by a group that included author Norman Mailer, the Voice didn’t stay dead for long. In 2020 Street Media, the publisher of L.A. Weekly, bought the publication from Barbey’s Black Walnut Holdings for undisclosed terms and resumed publishing stories on its website and in print in 2021.
Hailing from one of the country’s wealthiest families, Barbey and his relatives control a nearly 20% stake in VF Corp., which John Barbey founded in Reading in 1899 as a gloves and mittens manufacturer. The company, which today is based in Denver and whose brands also include Timberland, Eastpak and Supreme, has a market capitalization of around $6 billion.
Publicly traded since 1951, VF had a stock price of about $15 Friday, well below its prepandemic price of close to $90 a share.
Barbey’s West 12th Street penthouse, which is part of a large condo complex called The Greenwich Lane that Rudin Management developed on the site of St. Vincent’s Hospital, was reportedly his first-ever home in New York City.
Richard Ziegelasch, the Corcoran Group broker handling Barbey’s listing, declined to comment.
Investment giant BlackRock has sold an Upper East Side apartment building at what appears to be a slight loss despite the city's red-hot rental market.
Farallon Capital Management and Hal Fetner's Fetner Properties have purchased 85 East End Ave., located between East 83rd and East 84th streets, from the firm for $75 million. BlackRock had bought it in 2005 for about $75.2 million, according to property records.
A representative for BlackRock declined to comment on the deal. Representatives for Farallon and Fetner did not respond to requests for comment by press time.
The residential tower was built in 1951 and stands 15 stories tall with 157 apartments, according to commercial real estate database CoStar. It spans roughly 170,000 square feet.
The tower was the subject of controversy in the late 2000s, when the prestigious Brearley School, a private all-girls academy whose graduates include Caroline Kennedy and Tea Leoni, went into contract to buy a portion of the building for an expansion. However, the deal faced strong resistance from the building's rent-stabilized tenants and ultimately collapsed.
No apartments are currently available at 85 East End Ave., according to StreetEasy. Prices at recently rented units have ranged from $3,150 for a studio to $14,995 for a four-bedroom, the listings site says.
Although there have been plenty of examples of hotels and office buildings selling for a fraction of their pre-Covid prices in the wake of the pandemic, discounted apartment building sales have been much rarer. The city's rental market has come roaring back after prices briefly plummeted early in the pandemic, with the median Manhattan rent hitting a record high of $4,400 in July last year. The median rent in the borough was $4,250 as of May and seems poised to break records again this summer.
Farallon is a San Francisco-based hedge fund with offices across the globe. The firm, founded in 1986 by Tom Steyer, a well-known environmentalist and mega donor to the Democratic Party, established a New York office in 2022. Steyer left Farallon in 2012.
Fetner Properties has luxury apartment buildings in Manhattan and Long Island City. Empire State Realty Trust acquired the company's stakes in a Hell's Kitchen building and a Yorkville property earlier this year so Fetner could focus more on the Upper West Side and Queens.
Leases
HSBC expands and tech company arrives at The Spiral
Address: 66 Hudson Blvd., Manhattan
Landlord: Tishman Speyer
Tenant: HSBC
Lease size: Approx. 300,000 square feet
Asset type: Office
Brokers: JLL's Peter Riguardi, Matt Astrachan, Mitchell Konsker and Will McGarry represented the tenant. Greg Conen and Sam Brodsky represented the landlord in-house.
Address: 66 Hudson Blvd., Manhattan
Landlord: Tishman Speyer
Tenant: XR Extreme Reach
Lease size: 13,400 square feet
Asset type: Office
Brokers: JLL's Joe Messina and Seth Hecht represented the tenant. Greg Conen and Sam Brodsky represented the landlord in-house.
Sales
Spanish investment firm acquires Sonder Hotel site in NoMad
Address: 1141 Broadway, Manhattan
Seller: Yaron Jacobi
Buyer: Azora Exan
Sale price: $47.8 million
Asset type: Mixed-use
Developer Glacier Equities snaps up Greenpoint building by Newtown Creek
Address: 99 Commercial St., Brooklyn
Seller: Barbara Kennedy
Buyer: Myles Horn
Sale price: $27.5 million
Asset type: Mixed-use
Commercial garbage hauler buys former stoneyard in Maspeth
Addresses: 57-57 and 57-05 47th St., Queens
Seller: Prologis
Buyer: Bestway Carting
Sale price: $14.8 million
Asset type: Industrial
Financings
Pair of Gowanus developments land construction loans
Address: 310 and 340 Nevins St., Brooklyn
Owner: Tavros Holdings and Charney Cos.
Lenders: Affinius Capital, Kennedy Wilson and TYKO Capital
Loan amount: $300 million
Asset type: Multifamily
The 20-story Hotel on Rivington is struggling 20 years after the glass tower transformed the Lower East Side’s bohemian streetscape.
Business hasn’t recovered since the pandemic faded away, and some guests on review sites complain the hotel is showing its age. More worrisome, the 109-room boutique hotel isn’t generating enough cash to cover its expenses and interest payments, Fitch Ratings said in a report last week. Debt investors are facing an $8 million loss on a $35 million mortgage that matures in two years.
“The hotel continues to underperform,” Fitch said, and warned of an “increased probability of default.”
Rivington owner Paul Stallings could not be reached for comment.
The Rivington’s opening in 2004 marked the beginning of gentrification for the three-by-three grid of blocks south of Houston Street that’s been chock full of mobbed bars and clubs for years. Yet in spite of that location — or maybe because of it — the Rivington has struggled. In 2015 it had lower occupancy and lower room rates than other downtown boutique hotels, such as the Soho Grand or the Ludlow, according to bond-rater KBRA.
In 2018 Stallings agreed to sell the hotel to the Kushner family for $65 million, but the deal never closed and both sides sued. The parties settled by agreeing to split the Kushners’ $2 million down payment, an attorney for Stallings, Michael Stepper, told Crain’s.
Since the pandemic, the Rivington has struggled to lure back guests. Occupancy last year was just 57%, well below the 84% rate enjoyed by competitors, according to KBRA, and revenue per available room was 40% lower.
The city Department of Finance estimates the building’s market value has fallen by 45% in the past decade, to $19 million.
Recent guests praise the Rivington’s views and staff but some say on TripAdvisor the hotel needs freshening up. One said the elevator was “completely shabby” and light switches in the bathroom took multiple presses to work. The hotel replied that it is working on a “new concept” for rooms.
Fitch said a renovation “was planned” to reposition the Rivington as a five-star hotel and redesign the restaurant, rooftop, night club and guest rooms.
“The borrower has not provided updates regarding the renovation,” Fitch said.
A new City Council bill would require the city’s health plan cover the cost of fertility treatments regardless of an infertility diagnosis, a move designed to level the playing field for gay male couples looking to start a family.
The move to clarify and ensure everyone has access to the benefit makes sense and is unlikely to result in a significant increase in costs: Of the $11 billion the city spends on health benefits each year, only about $50 million goes toward fertility benefits, which are utilized by about 3% of the total covered population.
LGBTQIA+ couples often struggle to obtain insurance coverage for the costly procedures required to build a family, from egg donation to in vitro fertilization, surrogacy and adoption, as Judy Messina reports this week. Only seven states, including New York, require insurance companies provide such coverage irrespective of a couple's sex or sexual orientation. Local government employees are among those battling for equal access to fertility benefits.
NYC’s health plan covers fertility benefits including in-vitro fertilization, which fertilizes eggs in a lab, and can cost $15,000 per cycle. But the bill’s sponsor, Councilwoman Lynn Schulman, says that gay male couples can’t access the benefits because they don’t meet an outdated definition of infertility.
The insurance plan covers up to three cycles of assisted reproductive treatments, which can include IVF. But under state law mandating fertility benefits, employees are required to prove that they have a diagnosis of infertility to get that coverage, meaning that they are unable to get pregnant after a year of unprotected sex.
That definition can include heterosexual couples, same-sex female couples and single women but prevents gay male couples from qualifying for coverage, Schulman says.
The city has refuted claims that its current insurance practices are discriminatory, noting that an infertility diagnosis is not the only pathway to obtain coverage for IVF.
The Council is not the only party pushing back on the city’s coverage practices. The Adams administration also faces a class action lawsuit filed by Corey Briskin, a former Manhattan assistant district attorney, and his husband Nicholas Maggipinto, who said they were not eligible for IVF coverage because neither was diagnosed with infertility.
The city would be wise to follow the lead of many private employers in the region, and large companies in particular, that have stepped up, providing the same family-building benefits to gay couples that they offer to heterosexual employees. They see such benefits and programs as a key to recruitment, productivity and job satisfaction. It would also give the city another recruitment tool as it seeks to fill a glut of open positions.
The Financial District, home to a long list of planned residential conversions, may be hogging the spotlight when it comes to turning office towers into apartment buildings.
But the city’s largest-ever reinvention of a commercial property will actually be in Midtown, where the former two-building headquarters of pharmaceutical giant Pfizer, at 219 and 235 E. 42nd St., is poised to become a 1,500-unit rental complex.
And as Mayor Eric Adams drums up support for the City of Yes initiative, which would make such conversions easier and more widespread, the Pfizer project isn’t sitting idly by. Demolition is set to begin in a few weeks, developers say.
As more developers and officials express interest in office reinventions as a way to help stem the housing crisis, the Pfizer project, which has somewhat flown under the radar, also serves as a showcase of just how much has to be taken into account, from windows to affordable housing levels, to get such conversions off the ground.
“We’re not waiting for any changes in policy,” said Nathan Berman, the chief executive of project lead Metro Loft Developers, a prolific converter that once focused exclusively on Lower Manhattan, of the Pfizer work. “And we may become an interesting case study for what the city and state are trying to do.”
A major makeover
A massive conversion would need a major footprint, which Nos. 219 and 235 have in spades.
The two empty buildings that are now there contain an unusually voluminous 973,000 square feet of space, according to city records. And the sites, which are between Second and Third avenues, also come with unused air rights, which Metro Loft and partner David Werner Real Estate plan to utilize for new floors.
Ultimately, Metro Loft and Werner will create more than 1,500 units, ranging from studios to three-bedrooms, which likely will be available for lease signings starting in 2026 and move-ins in 2027, Berman shared.
Getting to that point will entail a massive amount of construction. Currently, the windows in the two buildings, which have only ever functioned as offices, can’t be opened, fairly common for office buildings.
But the local housing code mandates that apartments have at least one operable window. Instead of just swapping out windows here and there, however, Pfizer’s developers will go a big step further and replace every window at the site, all 2,000 of them, they say.
Also on the agenda: removing the facades and installing more energy-efficient outer walls, a notable departure for conversions, which so far in New York have tended to keep exteriors as is. But after earlier waves of conversions, eligible buildings with attractive prewar facades are fewer and further between these days, which is forcing developers to consider newer structures, analysts say.
“People walking by those buildings two years from now may think they’re brand new,” Berman said.
The massive facelift won’t come cheap. Berman estimates the Pfizer project will cost “hundreds of millions of dollars, but we hope to not hit $1 billion.” And the extreme price tag seems to have shaped the business plan; all the apartments at the Pfizer site, which will not have any affordable housing, will be offered at market-rate rents.
Though state lawmakers this spring established a program to award property tax breaks for certain conversion projects in exchange for their making 25% of units affordable, some developers are skeptical that those projects can be financially sustainable even with the abatements.
Pfizer appears eligible for the city-administered program because it’s in a central Manhattan neighborhood, will have broken ground after 2023 and will wrap up by 2039. But Berman has questions about how affordable units could stay that way permanently.
“We’ve never had a situation where tax breaks burn off, but you have the affordable units forever,” he said. “It’s a package that needs to be evaluated.” Berman said he is not counting on the incentives to get Pfizer across the finish line.
Pfizer has not yet lined up construction financing and will begin that process in a few months.
Beneath the surface
From a site-selection perspective, the Pfizer properties check important boxes.
Under the current system, developers can generally convert only commercial Manhattan high-rises constructed before 1961. Commercial buildings constructed after that date tended to be much larger than residential ones, and the approval process to build offices is rarely as rigorous as with apartment buildings, so officials made many office sites off-limits to prevent workarounds.
But facing anemic levels of housing production and strong demand, the mayor has proposed easing the rules and allowing conversions of towers from the 1960s, 1970s and 1980s as well.
When Berman’s team went searching for opportunities, however, the old rules were in effect.
At first blush, Nos. 219 and 235 might seem to miss the mark.
The lime-green panels across No. 219’s facade suggest the building dates to the Kennedy era, and glassy and unadorned No. 235 seems of similar vintage. But lurking under No. 219’s colorful skin is actually a prewar building built in 1905; the facade was installed in a 1963 renovation. And No. 235, built specifically to house Pfizer, opened in 1961, meaning it squeaked in under the current criteria.
The block, which sits in what’s known as a C zone in planning terms, also allows for conversions as of right, so no special rezoning is needed, an advantage that does not exist in every commercial district. Adams has proposed rezoning 42 blocks in former manufacturing enclaves in Chelsea and Garment District to allow for up to 4,000 new apartments, but the rezoning is subject to the city’s public land-use review process and so could take a while to play out.
From meds to beds
The 42nd Street makeover, which will eventually result in a building with a new name that has not yet been determined and a new street address, will mark the end of Pfizer’s half-century association with the block.
Founded on the outskirts of Williamsburg, Brooklyn, by German immigrants Charles Pfizer and Charles Erhart in 1849, before relocating to Maiden Lane in the Financial District in 1868, Pfizer broke ground on part of its third location, the building at 235 E. 42nd St., in 1959 and was finished two years later. (The company relocated to 66 Hudson Yards in 2022.)
Home to 1,000 employees when it opened and 2,700 in recent years, interconnected Nos. 219 and 235 aimed to create medication “breakthroughs that change patients’ lives,” according to an inscription across the tile-studded mosaic in the lobby of No. 235.
Pfizer, a prominent vaccine provider during the Covid-19 pandemic, has given up the site gradually in preparing for its West Side move. In 2018 the company sold No. 235, an L-shaped, 33-story site that extends through to East 43rd Street, to Alexandria Real Estate Equities and Werner for $228 million, according to the city register, though Pfizer was allowed to stay for a few years as a tenant.
Meanwhile, Pfizer sold next-door No. 219, a much-smaller but also through-the-block property, to Werner and Alexandria in 2018 for $142 million, the register shows. The deal included both the building and the land.
Next, Metro Loft and Werner are in contract to buy out Alexandria’s stakes in the sites, and a closing is scheduled in the next few weeks, a broker familiar with the transaction said.
In a separate but related transaction, Werner in 2021 leased the land under No. 235, which is owned by the family of the late real estate investor Bernard Kayden, for $407 million, records show. The deal includes an option to buy the land, which Metro Loft and Werner will exercise a few years down the road, Berman said.
A message left at Werner’s Midtown office was not returned, and efforts to track down the Kayden family’s representatives were unsuccessful.
In the details
To be sure, not all upcoming office conversions are near Wall Street. Commercial landlord SL Green Realty Corp., for instance, has proposed converting 750 Third Ave., a 34-story tower at East 46th Street in Midtown burdened with an 80% vacancy rate, into housing. And developer Lalezarian Properties has filed plans to reinvent 650 First Ave., a Victorian-era brewery site near the United Nations, with 111 apartments.
But most of the five-dozen conversions that are in the works, as per the city’s matchmaking Office Conversion Accelerator program, appear to be located downtown. Examples include 160 Water St., 55 Broad St. and 17 Battery Place, as well as 25 Water St., which is the city’s second-largest conversion project, with 1,300 units underway.
For Pfizer, conversions come with the territory. In 2011 the company sold its original Williamsburg location, , at 630 Flushing Ave., where Viagra and Lipitor were developed, to the firm Acumen Capital for $19 million. Acumen later obtained a $58 million loan to redevelop the site, which is home to FreshDirect and other industrial-type tenants today. But traces of the past linger. Blue block letters still spell out the word “Pfizer” over a door.
NEW COMMISSIONER: Dr. Joxel Garcia was appointed Friday to serve as first deputy commissioner and chief program officer at the Department of Health and Mental Hygiene. Garcia will facilitate city health programs across different divisions of the agency, including the city’s life expectancy campaign HealthyNYC, and will oversee divisions of disease control, environmental health, family and child health and mental hygiene, the agency said. The new deputy commissioner previously worked in the private sector and at the federal level, serving as the 14th Assistant Secretary for Health for the U.S. Department of Health and Human Services and a Four-Star Admiral in the U.S. Public Health Service.
SUICIDE PREVENTION: The city launched a prevention program in public hospitals in Queens and the Bronx to support children who attempted suicide, Mayor Eric Adams announced on Friday. The program aims to engage kids who were hospitalized for a suicide attempt through their hospital stay and provide follow-up care for at least three months, as the risk of a repeated attempt is highest up to a month after kids leave the hospital, health officials said. The prevention program will be available at Elmhurst Hospital in Queens and Lincoln, Jacobi and North Central Bronx facilities.
DRUG CHECKING ALERT: The state Department of Health issued a public health alert on Friday after its drug checking program detected a dangerous mix of substances including medetomidine in Central New York and the Capital Region. The synthetic sedative, used in veterinary medicine, is more potent in the central nervous system than xylazine, another veterinary drug that officials have warned about due to its ability to cause large open wounds and fatal overdoses. The agency found two drug samples including medetomidine that were linked to non-fatal overdoses.
Pomelo Care raised a $46 million Series B funding round on Thursday to continue to grow its maternal and infant telehealth platform.
The Flatiron-based startup offers virtual care to expecting parents and their babies as a supplement to in-person medical appointments. Pomelo Care directly employs all of its ob-gyns, pediatricians, nurses, midwives and lactation consultants, and plans to use the new funding to hire more clinicians, said Marta Bralic Kerns, the company’s founder and CEO.
The Series B round was led by existing investors Andreessen Horowitz and First Round Capital. Other investors including Stripes, BoxGroup, Operator Partners and SV Angel also participated in the round.
Since Pomelo Care launched out of stealth a year ago, it has expanded its coverage to 3 million people across the country. Bralic Kerns founded the company with an aim to fill gaps in maternal and infant health care, as the U.S. has struggled to reduce racial disparities in maternal morbidity and mortality and improve neonatal health outcomes.
The startup contracts with health insurance companies including both Medicaid providers and commercial plans, and offers telehealth services to patients with no out-of-pocket costs, Bralic Kerns said. The company is licensed to provide care in all U.S. states but currently treats patients in 46 states, she added.
In addition to growing its clinician workforce, Pomelo Care plans to use its recent funding to advance its technology and data platform, Bralic Kerns said. The company has started to use data from insurance claims and electronic health records to help it identify patients that may be at risk for health complications, and target where it offers pregnancy, postpartum and infant care.
Bralic Kerns said that Pomelo is also planning to hire data scientists and software engineers to improve the company’s technology and analyze data.
Pomelo Care employs around 180 people currently, 60% of which are clinicians, Bralic Kerns said. The company has raised nearly $79 million to date, according to data from PitchBook.
A state appeals court struck down a legal challenge from 130 nursing homes on Thursday that aimed to overturn a state law mandating that they spend the bulk of their revenues on patient care.
The nursing homes took aim at a 2021 law that required them to spend at least 70% of revenues on direct care, 40% of which was allocated to staffing. The industry argued that the law was an overreach of legislative authority and singled out nursing homes as a regulatory target.
But the minimum spending law “easily survives rational basis review” because it’s related to a legitimate state objective: “ensuring that nursing homes meet minimum standards of patient care,” Associate Justice Michael Mackey, who sits in the Appellate Division, Third Department, wrote in the unanimous decision.
The minimum spending law was passed in April 2021 in conjunction with a staffing law that required nursing homes to provide at least 3.5 hours of direct care to residents each day. New York had just experienced thousands of nursing home deaths related to the Covid-19 pandemic when the laws were passed, which made the legislature sensitive to the health needs of vulnerable nursing home residents, the justices’ decision said.
“Although plaintiffs may disagree with the line drawn regarding minimum revenue spending or to which health care providers the mandate applies, ‘it is the Legislature's function to draw the line,’” the decision said.
The nursing homes challenged the law after it went into effect in 2022, deeming it “the most serious regulatory threat to the nursing home industry, and potentially to thousands of nursing home residents statewide, in recent memory.”
The Albany County Supreme Court rejected that challenge by the end of 2022, leading the nursing homes to file an appeal. The appeals court decision represents the highest court to evaluate the nursing home minimum spending rule in New York.
Lawyers for the nursing homes did not respond to a request for comment from Crain’s on Friday.
Although many nursing homes see laws regulating how they spend their money as bad precedent, most nonprofit and government-run facilities are already spending 70% of their earnings on patient care, said James Clyne, president and CEO of industry group LeadingAge New York. The group only represents nonprofit and government-owned facilities.
“The real issue is the state’s failure to adequately fund,” Clyne said. He said there’s a $1.6 billion funding gap between the state’s Medicaid payments to nursing homes and the true cost of care – a gap that makes the state’s staffing rule unachievable for more than half of the nursing homes that LeadingAge represents.
The appeals court’s decision is the latest development in legal challenges against a regulatory crackdown on the nursing home industry. Organizations including LeadingAge New York have sued over the minimum staffing law and spending requirements at the state level, although without success.
State efforts to regulate the nursing home industry mirror new oversight measures put forth by President Joe Biden’s administration. Federal health regulators finalized a minimum staffing rule in April that has also been met with industry pushback.
Three Texas nursing homes and their trade organizations, including LeadingAge’s national organization, filed a lawsuit challenging the staffing rule in a Texas federal court last month – the same court that suspended the approval of the abortion pill.
Long Island Community Hospital is inching towards the completion of its merger with NYU Langone next year, but it’s aiming to achieve a few more health and patient safety goals before it seals the deal.
The Patchogue hospital has operated as an affiliate of NYU Langone since 2021, after state health officials greenlit a merger to assist the financially-struggling facility. NYU filed plans earlier this year to complete a full asset merger, in which it would become the parent company of Long Island Community Hospital and grant the affiliate a new name.
But before that happens, Long Island Community Hospital is monitoring improvements in length-of-stay, hospital-acquired infections and on-time surgery starts to prepare for the merger, said Dr. Marc Adler, senior vice president and chief of hospital operations at Long Island Community Hospital.
Adler spoke to Crain’s about how Long Island Community Hospital has prepared for the merger and what’s left to do before it’s completed next spring. The below interview has been edited for length and clarity.
Long Island Community Hospital marked its 1,000th robotic surgery this week. Why did you celebrate that milestone?
A thousand robotic surgeries – basically from zero to a thousand since our affiliation – reflects NYU making an investment in people and resources and technology here. It’s not just the technology of using the robot; it's also the investment in technical skill and the physicians and surgeons who are performing these procedures, and there’s a myriad of them. It scales from the bread-and-butter surgical procedures that certainly a community hospital has to provide, such as gallbladder and hernia surgery. But we’re also developing programs for more advanced procedures such as cancer surgery and intricate biliary system surgeries, so that patients essentially can get that care locally in their own backyard.
Let’s talk about the pending merger. What other metrics are you monitoring at LICH before the merge is completed?
It’s not a flip of the switch and now we’re merged. We have already started focusing on improving quality metrics and that's why it takes a little time to go through our journey. To give you a couple of examples, during this time period we reduced the overall length of stay in our hospital by two days. Why is that important? Because patients can get home sooner. They're getting the care more immediately and more efficiently and effectively. We’ve also focused on reducing our overall hospital-acquired conditions and that’s been reduced since our affiliation by about 50%.
NYU has invested $100 million at LICH to upgrade electronic health records and expand ambulatory care. What’s been the nature of NYU’s investments since?
You mention the electronic health record. NYU has developed the Epic product that we use and is taking it to a higher level. We have an analytics team which takes information from Epic and makes it into a very usable format. We call them dashboards, where we can monitor our progress not just over time, but literally minute by minute. So we can correct courses very quickly. That’s a tremendous investment in resources, both people resources as well as technology resources.
Since our affiliation, we've also added over 100 providers at the hospital and our community practices. We have over 16 practices that we're affiliating and developing a community. We've enhanced or added over 15 services, subspecialty and specialty services, including primary care in the area. We've also purchased a building right in the center of town that is currently undergoing renovation and will be an ambulatory surgery center with six operating rooms for endoscopy suites, and is anticipated to be done in the next calendar year.
How much has NYU’s investment grown?
There's really tremendous growth here. It'll be easier to give you a number after the merger. But it’s significantly more, and there’s more to come.
The manufacturing and distribution industry is thriving with positive revenue, growth and product performance as business leaders navigate an unpredictable market.
Here are the subway disruptions, road closures and other commuting changes you should be aware of as you get around the city this week.
Subways
— 5 train service will end early between East 180th Street in the Bronx and Bowling Green in Manhattan beginning at 8:15 p.m. each day between Monday, June 24 and Thursday, June 27.
— No 7 trains between Queensboro Plaza in Queens and 34th Street-Hudson Yards, Manhattan beginning Monday, June 24 at 11:45 p.m. through Friday, June 28 at 5 a.m.
— G trains will not run between Bedford-Nostrand Avenues in Brooklyn and Court Square in Queens beginning Monday, June 24 at 9:45 p.m. through Friday, June 28 at 5 a.m.
— In the Bronx, no 4 trains between Kingsbridge Road and Woodlawn on Wednesday, June 26 from 9:45 a.m. to 2 p.m.
Commuter rail
No major disruptions planned for commuter rail.
Roads and bridges
Air travelers be warned: construction as part of the $19 billion redevelopment of John F. Kennedy International Airport will cause travel headaches this week for drivers and cab riders.
Expect delays due to detours or closures of roads around the airport.
The Port Authority of New York and New Jersey encourages the use of mass transit for access to or from JFK — with 20-minute trains to the Jamaica AirTrain JFK station available from Grand Central Terminal or Penn Station. For drivers, the Port Authority encourages the use of its free drop-off, pickup and waiting lot at the Lefferts Boulevard AirTrain JFK station, where passengers can connect to the free AirTrain for an eight-minute ride to the airport’s terminals.
Read recent transportation stories:
Anyone who’s had to go to work on a hot summer day knows how exhausting it can be. Brain function slows, commuting is more uncomfortable and, for people who work outdoors, simply staying safe becomes a challenge. All of these factors combined add up to a heat-related hit on worker productivity, which stands to get more pronounced as climate change drives more intense heat waves.
“We used to think, ‘Well people get hot and they sweat and they’re fine.’ But now we know that’s not necessarily the case,” says Jill Rosenthal, director of public health at the Center for American Progress, which this month released a report on the threat extreme heat conditions pose to workers in the U.S.
Quantifying that threat can be difficult. Broadly speaking, it includes everything from weather-related commuter disruptions to diminished cognitive performance, poor sleep and added time off when kids are kept out of schools that lack air conditioning.
But there are some hard numbers: During a heat wave last summer, President Joe Biden said extreme heat is costing the US $100 billion a year, citing a report from the Atlantic Council that warned those losses could double by 2030. Between 1992 and 2017, heat stress killed more than 800 workers in the U.S., and injured more than 70,000, according to the Bureau of Labor Statistics.
The most severe of these impacts are felt by people whose jobs are outdoors. In the U.S., just five states guarantee workers access to rest, shade and water. Federally, the Occupational Safety and Health Administration’s general duty clause requires employers to provide a safe and healthy workplace, but it doesn’t set clear standards for heat hazards. OSHA is working on such standards, which would be implemented anytime the outdoor temperature crosses 80°F. But they aren’t expected to take effect until next summer.
Some other countries have clearer guidelines. In China, for example, employers are required to train workers on heat-related illnesses and provide rest areas, free cool drinks and air conditioning indoors. Work hours and intensity must be cut or suspended on hot days, and workplaces that can’t keep temperatures below 95°F outdoors and 91.4°F indoors must pay their workers High-Temperature Subsidies ranging from the equivalent of $1.24 to $30.90 per day.
The greatest heat-related labor losses are born by outdoor industries such as construction, mining and agriculture, according to the Federal Reserve Bank of San Francisco. By 2200, researchers there estimate heat-induced labor losses will reduce U.S. capital stock, a measure of accumulated investment, by 5.4%, and consumption by 1.8%. In workplaces with limited air conditioning, including restaurants and warehouses, safety and productivity will also take a hit.
White-collar workers, who are most likely to have an air-conditioned office at their disposal, aren’t entirely spared from the effects of extreme heat. That’s in part because heat affects cognitive performance. The body’s process of cooling itself down saps energy that is normally used for the complex brain functions, says Clayton Page Aldern, neuroscientist and author of "The Weight of Nature: How a Changing Climate Affects Our Brains."
“What do we happen to see disappear in those instances? Well it’s the finely honed executive control functions and higher-level attention networks — the stuff that happens in the most newly evolved areas in the brain,” Aldern says. “The stuff that defines humans as humans is some of the first stuff to go in the heat.”
Hot weather also impairs cognition by causing inflammation to brain tissue, weakening the connection of neural networks and disrupting sleep. Though air conditioning can rescue people from these deficits, Aldern says heat exposure at night and on the way to work can still have lingering cognitive effects.
Then there’s the way heat disrupts infrastructure. Railroad tracks, airport runways and roads are all susceptible to heat, which can melt asphalt and weigh down overhead wires. Some of the biggest transit corridors — including the Northeast Corridor that links up much of the East Coast — experience delays when temperatures climb, preventing commuters from getting to work on time.
Gabrielle Guarneri, who commutes from New Jersey to Manhattan for work via New Jersey Transit, says she was “consistently late” during last July's heat wave. The memory felt particularly fresh as Guarneri waited on a stalled train outside Penn Station on June 18, when her commute was delayed by over an hour due to a disabled train.
In places where AC is less common, arriving at work doesn’t necessarily offer relief. Across Europe, many businesses, schools and homes lack air conditioning entirely. Even in the U.S., known for its high levels of AC adoption, more than 40% of schools need new or updated heating, ventilation and air-conditioning systems.
When an office does have AC, extreme heat can have the ironic impact of increasing employees’ affinity for it — a reversal from the pandemic-driven shift toward working from home. “For a lot of people it’s more comfortable in the office than home,” says Mark Ein, chief executive of Kastle Systems, an office security company that monitors how often employees in over 2,600 buildings across 138 cities swipe into their offices.
When Kastle examined four heat waves across the U.S. cities it monitors between 2022 and 2023, it found no correlation between a rise in temperature and employee absenteeism. But other events do have clearer fallout. “During adverse weather like the flooding in Texas, we saw those have a huge impact on our data,” Ein says.
Mansoor Soomro, a future of work lead and professor at Teesside University Business School, says even companies with air-conditioned offices are working to increase employee awareness of heat. Some promote “hydration stations,” while others mandate risk assessments, focusing on the employees most vulnerable to heat.
Although productivity is a factor, Soomro says mitigating any adverse effects from heat — like medical emergencies — is a bigger one. “Reputation is a risk far higher than the financial,” he says.
A New York federal judge overwhelmingly rejected a central argument in lawsuits against congestion pricing tolls, giving proponents of the plan fresh optimism following Gov. Kathy Hochul’s decision to indefinitely pause the program’s planned June 30 implementation.
Three lawsuits filed by outer-borough elected officials, the influential United Federation of Teachers and a coalition of concerned city residents claimed that federal and state transit officials had advanced congestion pricing without a comprehensive environmental review and without proper mitigations against potential adverse impacts.
U.S. District Court Judge Lewis Liman largely dismissed the lawsuits’ arguments Thursday in a 113-page decision. Not only is additional study of the tolls unnecessary, Liman declared in his ruling, but transit officials conducted an “exhaustive review process” that resulted in a “painstaking examination” of congestion pricing and its environmental impacts.
“According to Plaintiffs,” Liman wrote in his decision, “the [federal environmental] review process here — which spanned four years and yielded an administrative record of more than 45,000 pages — did not amount to a “hard look” at the environmental implications of Congestion Pricing. In light of Defendants’ meticulous analysis, the Court cannot agree.”
Liman added that it is “abundantly clear” that the Federal Highway Administration and the Metropolitan Transportation Authority delved deeply into the environmental consequences.
Project analysis found that drivers seeking to avoid the tolls could overburden certain environmental justice communities, and that led state and city transit officials to commit $155 million in mitigation measures over five years, and to monitor traffic and air quality changes.
“Simply put, the [federal review] process worked precisely as it should,” wrote Liman.
Liman’s rebuke is an undeniable win for the MTA and backers of congestion pricing, but it’s a somewhat hollow victory now that the fate of the tolls are up in the air with Hochul’s postponement. Hochul has refused to give an updated timeline for the program’s launch, and the governor’s office did not respond to a request for comment on Liman’s ruling.
MTA General Counsel Paige Graves in a statement said transit officials “appreciate the thorough evaluation of the environmental review” and “stand ready to relieve congestion and improve transit service for millions of riders." The Congestion Pricing Now coalition, which is made up of business, transportation and environmental groups, said in a statement that Liman’s ruling served as "another vindication for congestion pricing.”
At least five other lawsuits against the tolls are working their way through the courts, including what’s widely considered to be the strongest challenge, which was filed by New Jersey officials.
Liman’s decision also didn’t entirely quash the legal challenges against the tolls. The judge found it “premature” to rule on an argument that the tolls could burden small businesses and that a study of the impacts are needed.
Jack Lester, an attorney representing one of the plaintiffs, New Yorkers Against Congestion Pricing Tax, said his clients are waiting to see what action the MTA’s board takes at its June 26 meeting, but could refile a lawsuit emphasizing the potential impacts of the tolls on small businesses as soon as next week
Lester added that Hochul’s pause on the fees, due to what she says are her concerns about the economic impact of the charge on motorists, provide fresh legal fodder for court action.
“It will be a critical part of our case,” said Lester in an interview. “We're very confident because the governor saw the light at the eleventh hour and that was based on her assessment of the negative economic impacts.”
Leases
Charter school inks Brooklyn lease
Address: 39 Truxton St., Brooklyn
Landlord: Fulton Gate Realty
Tenant: Imagine Me Leadership Charter School
Lease size: 78,000 square feet
Lease length: 35 years
Asset type: Education
Brokers: Steve Nadel and Nechama Lebrow represented the landlord in-house. OPEN Impact Real Estate’s Stephen Powers, Lindsay Ornstein and Jake Cinti represented the tenant.
Software firm takes space near Bryant Park
Address: 1410 Broadway, Manhattan
Landlord: L.H. Charney Associates
Tenant: Grata Inc.
Lease size: 15,158 square feet
Asset type: Office
Brokers: Colliers’ Richard Doolittle, Michael Joseph, John Howard and Taylor Bell represented the landlord. Cushman & Wakefield’s David Hoffman and Sam Hoffman represented the tenant.
Sales
Homeless shelter provider picks up garage site near City College
Address: 478 W. 130th St., Manhattan
Seller: David Manesh
Buyer: Urban Resource Institute
Sale price: $16 million
Asset type: Industrial
Investment group fund unloads Yorkville rental property
Address: 85 East End Ave., Manhattan
Seller: BlackRock
Buyers: Fetner and Farallon Capital Management
Sale price: $75 million
Asset type: Multifamily
Financings
Financial District skyscraper refinances
Address: 1 Liberty Plaza, Manhattan
Owner: Brookfield Properties
Lender: Morgan Stanley
Loan amount: $51.9 million
Asset type: Office
New York City’s improving fiscal situation seemed to foretell an easier path to passing the coming year’s budget, but the City Council and Mayor Eric Adams still disagree on key issues with days left before the deadline to reach a deal.
The council’s push to reverse cuts to cultural institutions, public libraries, parks and childcare are the chief remaining obstacles as negotiations continue ahead of the June 30 due date for the Fiscal Year 2025 plan. Council Speaker Adrienne Adams said Thursday that talks were “in a holding pattern,” while Mayor Adams used his own aerial metaphor earlier this week, insisting that “We're going to land the plane.”
By Friday, there had been progress: a council member involved in negotiations told Crain’s that the Adams administration has agreed to restore $48 million for cultural institutions, just shy of the $53 million lawmakers are asking for. All told, the council wants to restore some $1.6 billion of the roughly $7 billion in spending cuts that Adams imposed starting last year.
“We’ve always maintained that there’s enough money there to restore all of these blunt cuts and save for a rainy day,” Council Finance Chair Justin Brannan said in an interview on Thursday. Council leaders have staged a series of rallies in recent days to raise pressure on the Adams administration, including an event for cultural institutions outside City Hall on Friday.
Housing is another key issue in budget talks. Advocates have warned that affordable housing construction will drop in the coming year, undercutting one of the mayor’s key priorities, unless the $2.1 billion in capital funding for the Housing Preservation and Development Department is increased by at least $800 million.
After months of cost-cutting and dire warnings about the impact of the migrant crisis on the city’s finances, Adams softened his tone earlier this year, canceling plans for additional cuts and even restoring some of the funding he had recently cut for the police, trash can pickups and pre-schools. He attributed this sunnier view to a mix of successful efforts to pare down spending on migrant care, new aid from the state, and his administration’s more optimistic tax revenue forecasts, which brought City Hall’s conservative numbers closer to projections from other observers.
The debate over Adams’ current $112 billion budget proposal has been less fraught than last year’s tense talks, which were colored by the mayor’s projection that the migrant crisis would cost $12 billion through mid-2025. The projection has since been scaled back to around $10 billion.
But many of the other cuts Adams ordered starting last year through so-called Programs to Eliminate the Gap will remain in place unless the council manages to undo them. That includes a $58 million reduction to libraries that the city’s three systems have said would eliminate weekend service, a $19 million cut that reduced Department of Buildings staffing and the $3 million cut that will spell the end of GrowNYC’s farmers market composting stands.
“The last budget was more challenged by the concern that we don’t have the money,” a council member involved in negotiating said Friday. “This time, we know we have the money, yet we’re still finding challenges in getting [the administration] to close those gaps.”
The council’s other key asks include restoring $55 million to the Parks Department to avoid potential staff losses and less frequent cleaning, and $170 million for the universal 3-K and Pre-K programs.
Watchdogs say the city still cannot afford to spend lavishly. The hawkish Citizens Budget Commission, in a letter to the mayor and council speaker this week, warned both leaders against under-budgeting items like NYPD overtime whose costs are consistently understated, and urged a $1 billion deposit into the city’s Rainy Day Fund over the next two years.
“Under-budgeting has increased to an unprecedented level — with Executive proposals that do not fully fund current programs and the Council’s acceptance of the practice and advocating for the addition of programs that would be unaffordable if fully funded on an ongoing basis,” CBC President Andrew Rein wrote. “The integrity of the budget’s estimates, the public’s belief that budget issues are real, and the fiscal stability of the city are all at risk.”
Under the mayor’s most recent budget plan, gaps between the city’s projected spending and its revenues are forecast to grow slightly in the coming years, hovering between $5 billion and $6 billion a year through 2028.
Who wants to stay at the Four Seasons New York?
The high-end hotel chain is slated to reopen its Midtown location in September after a four-year closure.
Guests soon will again be able to book a stay at the Four Seasons at 57 E. 57th St., its Toronto-based operating company quietly announced in a press release earlier this month, although it's unclear when reservations will begin or when the hotel's planned "enhancements," as its website calls them, are expected to wrap.
Owned by billionaire Beanie Babies magnate Ty Warner, the five-star, 368-room hotel between Madison and Park avenues, closed in March 2020 at the start of the Covid-19 pandemic and hasn't reopened since. Warner and the hotel's operator, Four Seasons Hotels and Resorts, had reportedly been in the middle of a dispute over profitability and fee structures but apparently came to an agreement in order to reopen in a few months, the Canadian chain said in a June 11 statement while jointly announcing the spring 2025 reopening of another Four Seasons resort, The Biltmore Santa Barbara.
The deal includes selling off a certain number of rooms at the luxury hotel as residential units in order to make it financially feasible to continue operating — 50 of the 368 rooms would be converted to residential, according to the New York Post. Suzanne Hallberg, a spokeswoman for the Four Seasons, declined to comment on that agreement or any other renovations planned for the property, which is just steps from Central Park.
Vijay Dandapani, president and CEO of the Hotel Association of New York City, however, confirmed the move to Crain's Friday and described it as "almost certainly a financial decision" as the industry has yet to bounce back from the pandemic. Early in the Covid crisis, doctors stayed at the inn for free while taking care of patients at Upper East Side hospitals. Dandapani mentioned that more than 16,000 hotel rooms are currently being used for other services such as housing migrants and are not available for tourists, which Crain's reported back in April.
Already an internationally acclaimed chain, the Four Seasons took social media by storm last month after the video of a 1-year-old girl raising her hand in excitement about staying at the brand's Orlando location went viral.
A New York City-specific fund for financially troubled marijuana companies is slated to a begin awarding loans to businesses as soon as this summer.
The Cannabis NYC Loan Fund, which is flush with $2.4 million in city money, plans to award loans of $50,000 to $100,000 with interest rates capped at 9.5% to as many as 40 entrepreneurs who also hold permits for conditional adult use retail dispensaries, NY Cannabis Insider reported. The fund also plans to give out a second round to a broader pool of businesses. Applications for loans should be available by the end of the summer from the fund.
The CAURD group is a specific round of 463 licenses awarded last year by the state Office of Cannabis Management.
Once that initial pool of cash is exhausted, the fund will be replenished with $7 million from state coffers for a “second phase” of small business loans with a 0% interest rate in order to attract private investors to contribute to New York City’s cannabis fund, according to NY Cannabis Insider. The city envisions the fund growing to as much as $39 million as a public-private partnership.
Loans from the second phase will also be available to a wider array of entrepreneurs than just the CAURD shops; “all license types” will be eligible for loans of up to $500,000 at interest rates of 11.5% to 13.5%, which NY Cannabis Insider noted is “slightly above” the prime rate “but below typical private loans to cannabis companies.”
All fund loan recipients are limited to businesses operating within the five boroughs of New York City.
Read the full story in Green Market Report.
There’s nothing more powerful than a young person exploring their own potential. But for students to perform at their highest level, they need to be given the right conditions for learning which, without a doubt, include a healthy learning environment. As a nurse for over 25 years and currently as nursing faculty in academia, I have a vested interest in the health of students and the population as a whole.
With that in mind, I was thrilled when I heard the news that voters in the overwhelming majority of districts where electric school buses were on the ballot chose to move ahead with electric school bus procurements. These results show clearly that voters understand the importance of the state legislature’s historic decision to transition the entire state school bus fleet to zero-emission buses by the year 2035.
As a mom of four kids, I see this as critical legislation that has an immense impact on the health of our communities.
Today, the vast majority of the school buses in New York run on diesel fuel. Given the negative health impacts that diesel exhaust exposure has on our children, it haunts me to think of them sitting in traffic, forced to breathe toxic fumes. Diesel exhaust, a known carcinogen according to the World Health Organization, puts kids at increased risk for serious conditions like asthma – the leading cause of chronic disease-related school absenteeism in the United States. It’s also linked to negative cognitive development impacts, endangering students’ academic progress.
And the dangers of diesel exhaust aren’t felt equally. Students from Black households, low-income students and students with disabilities are all more likely to ride the school bus than their counterparts, meaning more exposure to diesel fumes. They also live closest to high truck traffic areas and highways and bear the disproportionate burden.
By switching to zero-emission electric buses, we can promise a healthy ride to school for students who need it most. There are widespread public health impacts to clean school bus standards. For example, more electric vehicles have been shown to help reduce asthma rates.
Luckily, there are exciting opportunities available to help New York districts fund their electric school bus journeys. The EPA’s Clean School Bus Program (CSBP), established by the Bipartisan Infrastructure Law of 2021, designates $5 billion to replace diesel-burning school buses in communities across the country. In fact, New York districts have received more than $214 million in federal funding for electric school buses through the CSBP — including $95 million in funding awarded this week, helping to bring hundreds of electric school buses to students across the state.
And the state is working hard to complement federal funding to make the transition as smooth as possible for school districts. The NY School Bus Incentive Program, for instance, is now open for applications, offering $500 million for school districts on a ‘first-come, first-served’ basis (so make sure your district knows as soon as possible!) to invest in zero-emission school buses and accompanying charging infrastructure. This funding can be used together with federal CSBP funding to cover the cost difference between an electric bus and a diesel school bus. Additionally, the New York State Energy Research and Development Authority (NYSERDA) continues to develop free resources and trainings covering all things electric school buses and charging.
We’ve already seen great momentum for electric school buses, with thousands already on the road across the country, and New York is leading the way thanks to decisive state action. Electric school buses have been proven to work in widely different climates, from the cold winters of Michigan to the intensely hot summers of Arizona, as well as on difficult terrain like the mountains of North Carolina. They’re more than ready to take on New York’s diverse geography.
As with any transition to a new technology, the transformation of our state’s school bus fleet will take work. But that work starts to feel more doable when we remember why we’re doing it: to provide a clean, healthy ride to school for students and communities across our state.
Jessica Varghese is a registered nurse, a fellow with the Alliance of Nurses for Health Environments and an Assistant Professor of Nursing at New York Institute of Technology.
Midtown-based real estate firm Sovereign Partners is scooping up another Manhattan office building amid the toughest market for the sector in recent memory.
The company, led by the Sakhai family, is purchasing 780 Third Ave. for $178 million from investment manager Nuveen, according to a source familiar with the deal and reports. The property, located between East 48th and East 49th streets, was built in 1984, stands 50 stories tall and spans about 517,000 square feet, according to commercial real estate database CoStar.
It is 83.6% occupied, with tenants including finance firm Pomona Capital and coworking firm Industrious, and its estimated rents range from $64 to $78 per square foot, according to CoStar.
An Eastdil Secured team of Gary Phillips and Will Silverman brokered the transaction, which was first reported by The Real Deal.
Representatives for Sovereign and Nuveen did not respond to requests for comment by press time.
This is just the latest in a string of recent office purchases for Sovereign Partners. The firm also picked up 100-104 Fifth Ave. near Union Square last year for $127 million. The sale represented a huge drop in value for the property, as seller Clarion Partners had purchased it in 2013 for $230 million. Sovereign similarly bought the tower at 126 E. 56th St. for a major discount last year, paying $113 million for it after seller Pearlmark Real Estate Partners bought it in 2008 for $158 million.
But Nuveen, the $1.1 trillion asset manager for the Teachers Insurance and Annuity Association, appears to have sold 780 Third Ave. for at least a slight profit. TIAA bought the building in 1999, according to property records, and although the price does not appear on the publicly recorded deed, CoStar lists it as $161 million.
Nuveen recently carried out a $40 million renovation at 780 Third Ave. and rebranded the property as The Gardens at 780. The company has a sizable affordable housing portfolio as well and announced a deal last year to acquire roughly 12,000 additional units from former Major League Baseball star Mo Vaughn's Omni Holding Co. for an undisclosed price.
Manhattan's office market still faces major headwinds coming out of the pandemic. A recent study from the Partnership for New York City found that return-to-office rates had declined compared to last fall, and firms are leasing 14% less space on average compared to pre-Covid levels, according to JPMorgan.
Midtown's office availability rate was 16.2% in May, and its average asking rent was $78.61 per square foot, according to data from Colliers.
Members of the billionaire Koch family will buy a minority stake in BSE Global, the holding company which owns the Brooklyn Nets, New York Liberty and the Barclays Center.
Julia Koch and her three children have agreed to invest an undisclosed amount in the group, according to a statement Wednesday. They will acquire a 15% holding in a deal valuing BSE Global at about $6 billion, a person familiar with the matter said, asking not to be identified because the information is private.
The Nets’ majority owner is Alibaba Group Holding co-founder Joseph Tsai, who will retain control of the teams, according to the statement. Bloomberg first reported Koch family members were in talks to acquire a stake in BSE Global.
The deal marks the highest valuation for an NBA franchise to date. Late last year, Mark Cuban sold a majority stake in the Dallas Mavericks to Las Vegas Sands’s Adelson family, valuing the team at $3.5 billion. Cuban bought the franchise from H. Ross Perot Jr. in 2000 for about $285 million.
The Kochs have an estimated fortune of $140 billion, according to the Bloomberg Billionaires Index. Charles Koch, the firm’s chairman, is the world’s 22nd-richest person with a net worth of about $66 billion. Julia is the widow of his brother David, who died in 2019.
While stakes in NBA teams have often changed hands with little fanfare, the rising wealth of the ultra-rich and the valuations of franchises has driven a surge in interest in such deals. Mat Ishbia, the billionaire chief executive officer of United Wholesale Mortgage, agreed in late 2022 to buy the NBA’s Phoenix Suns and WNBA’s Phoenix Mercury in a record deal that valued the teams at $4 billion.
A stake in the Golden State Warriors, the NBA’s most successful team over the past decade, is also up for sale with a potential valuation of $7 billion, Bloomberg News has reported.
Tsai bought 49% of the Nets in 2017 from Russian billionaire Mikhail Prokhorov. He purchased the remaining stake along with the Barclays Center arena in 2019 in what ultimately ended up as a $3.5 billion deal including debt.
Citigroup said artificial intelligence is likely to displace more jobs across the banking industry than in any other sector as the technology is poised to upend consumer finance and makes workers more productive.
About 54% of jobs across banking have a high potential to be automated, the bank said Wednesday in a new report on AI. An additional 12% of roles across the industry could be augmented with the technology, Citigroup found.
The world’s biggest banks have slowly begun experimenting more with AI over the last year, spurred by the promise that it will help them boost staffers’ productivity and cut costs. In its latest report, Citigroup found that the technology could add $170 billion to the banking industry’s coffers by 2028.
Citigroup has said it would equip its 40,000 coders with the ability to experiment with different AI technologies, and the company has said it’s used generative AI, which can produce sentences, essays or poetry based on a user’s simple questions or commands, to quickly comb through hundreds of pages of regulatory proposals.
“Our focus now is to taking it from the lab to the factory floor,” Citigroup’s Chief Executive Jane Fraser said Thursday at the company’s digital money symposium, adding that the banking giant is also exploring using AI to offer custom investment recommendations for wealth clients and to improve its cybersecurity offerings.
JPMorgan Chase is scooping up talent and Chief Executive Jamie Dimon has said he believes the technology will allow employers to shrink the workweek to just 3.5 days. Deutsche Bank is using artificial intelligence to scan wealthy-client portfolios. And ING Groep is screening for potential defaulters.
Generative AI “has the potential to revolutionize the banking industry and improve profitability,” David Griffiths, Citigroup’s chief technology officer, said in a statement accompanying the new report. “At Citi, we’re focused on implementing AI in a safe and responsible way to amplify the power of Citi and our people.”
Even if AI does replace some roles across the industry, Citigroup said, the technology might not lead to a drop in headcount. Financial firms will likely need to hire a bevy of AI managers and AI-focused compliance officers to help them ensure their use of the technology is in line with regulations.
Plus, new technologies haven’t always led to job cuts. In one example Citigroup offered, the number of human tellers soared between the 1970s and mid-2000s even after the introduction of automated teller machines.
Customer service
One of the primary use cases for generative AI among financial technology upstarts and banking giants alike has been in customer service and support. Take Revolut: the fintech is already using AI to capture more than 30% of all customer chats.
“That’s one area where the sky is the limit,” said Francesca Carlesi, who leads Revolut’s business across the U.K. “I’m in no doubt in a couple years from now we might have 80% of the customer interaction. They are very efficiently managed through genAI.”
Rivals like Amsterdam-based Bunq or Stockholm’s Klarna have also embraced the technology in recent years. Klarna hailed the technology for helping the company reduce operating expenses by 11% in the first quarter, while Bunq recently launched a chatbot allowing users to query their own spending information with questions such as “How long will it take me to retire?” and “How much money did I spend on my trip to New York?”
Citigroup warned in its latest report that AI-powered chatbots do have some limitations. In some cases, chatbots struggle to understand slang and they often have difficulty comprehending ambiguous questions, the bank found.
“Since AI models are known to hallucinate and create information that does not exist, organizations run the risk of AI chatbots going fully autonomous and negatively affecting the business financially or its reputation,” the report said.
A Kips Bay biotech company backed by life sciences investment firm Deerfield raised $81 million in a Series B funding round this week to continue developing a new antifungal drug.
Elion Therapeutics, formerly called Sfunga Therapeutics, is developing an intravenous drug to treat fungal infections among immunocompromised patients, including those with cancer or HIV/AIDs. Its potential drug, called SF001, got the nod from the U.S. Food and Drug Administration last year to expedite its development process, as it was designated as a potential antifungal treatment for serious or life-threatening illnesses.
Deerfield Management, which also led Elion’s seed and Series A funding rounds, co-led the Series B round alongside the AMR Action Fund, a public-private partnership that funds drug development to combat antimicrobial resistance. Illinois Ventures also participated in the round.
Elion Therapeutics is trying to create a less toxic version of a common antifungal chemical called amphotericin. The drug has been around since the 1960s, but its harsh side effects including kidney toxicity have earned it the nickname “amphoterrible,” said Dr. Kieren Marr, Elion’s president and chief medical officer.
Scientists for years have wrapped the antifungal in lipids to mitigate its toxic effects. Elion has taken a different approach, altering the molecule itself to reduce the side effects. It’s unclear whether or not the drug will work as it’s still in early-stage clinical trials, but Marr said her team is enthusiastic about early data showing positive outcomes.
The company will use its latest funding round to advance its antifungal treatment to a phase 2 study, which will evaluate its safety in immunocompromised people with presumed fungal pneumonia, Marr said.
The investment comes as scientists raise concerns about fungal infections across the globe. The WHO recently declared four fungal pathogens a “critical priority,” including common types of mold.
Globally, 150 million people suffer from severe fungal infections each year and 2.5 million die from such infections. Marr said a new drug in this antifungal class would be a major development, as the last innovation emerged in the 1980s.
Elion Therapeutics was founded in 2019 as a collaboration between Dr. Martin Burke, a chemistry professor from the University of Illinois at Urbana-Champaign, and Deerfield. The company has raised $111 million to date, according to PitchBook.
Facing parallel plagues of extreme heat and poor air quality, New York city and state officials are encouraging residents to devise a plan for dealing with the worst nature has to offer.
But there appear to be few interventions offered beyond their good advice.
Earlier this week, Mayor Eric Adams and Gov. Kathy Hochul each held briefings warning residents of the dangers of this week's heat wave and imploring people to seek refuge, especially if they have a pre-existing condition. The only tangible offerings, however, appear to be cooling centers that can reach just a fraction of the vulnerable population, and a halting air conditioning subsidy that helps even fewer. Otherwise, residents are left to sweat it out, or worse.
With air quality dipping and temperatures expected to continue to rise into the 90s this weekend, the heatwave is shaping up to be an early-summer test of how New York copes with soaring temperatures amid a changing climate.
“Stay indoors. Stay with your air conditioning,” Hochul said during a briefing on Tuesday. “If you don't have AC, go to a library, a government building, or a cooling center near you…Make a plan so you are ready no matter what happens.”
“It is crucial that you plan ahead and make sure everyone is safe including your pets,” Adams said at his own press briefing on Monday with the Mayor’s Office of Emergency Management and other city agencies, while asking residents to“please also make sure to check in on your neighbors.”
Not getting an air conditioner ‘tomorrow or today’
The heatwave sent 28 people to the emergency room between Monday and Wednesday, according to data kept by the city health department. Statewide, 95 individuals went to the hospital with heat-related injuries, more than six times the historical average per day in June. That number is expected to rise with temperatures this week, which peaked 90° in the city on Thursday and are forecasted to reach the mid-90s by Sunday.
Most heat-related deaths occur in homes without air conditioning, “often due to limited access or financial constraint,” said Emergency Management Commissioner Zach Iscol at a Monday briefing. “This vulnerability disproportionately is experienced by Black New Yorkers who are twice as likely as white New Yorkers to succumb to heat-exacerbated mortality.”
But equipping the most vulnerable New Yorkers with air conditioning cannot happen overnight. In the long term, the city’s strategic climate plan, known as “PlaNYC,” includes new limited requirements for home cooling in certain settings but these have yet to be completed, including a requirement for cooling in new housing in 2025. The city also encourages eligible low-income New Yorkers to take advantage of federal Home Energy Assistance Program funds, administered through the state, to obtain free air conditioning and installation. That resource is limited to $22 million and is available on a first-come, first-served basis, according to a spokesperson for Governor Kathy Hochul. Last year, those funds ran out less than a month into summer.
“You can apply for [the program] now but you're not going to get an air conditioner tomorrow or today,” said Aries Dela Cruz, spokesperson from the Mayor's Office of Emergency Management.
The most vulnerable New Yorkers
Older New Yorkers and people with preexisting conditions like obesity, heart and respiratory illnesses are at heightened risk for heat-related injury and death. Low-income residents in underserved communities have less access to air conditioning in their homes, which increases the danger. Over 1.1 million New Yorkers had cardiovascular disease in 2021, and 8.4 million were either obese or overweight according to the latest state DOH data. Approximately one in 20 New Yorkers have a chronic lung disease, according to a 2022 survey from the Centers for Disease Control and Prevention.
Each year, an average of 450 New York City residents are hospitalized for direct heat-related illnesses, according to Patrick Gallahue, a spokesperson for the city Department of Health and Mental Hygiene.
Officials have also raised concerns about declining air quality due to ozone and other fine particles caused by pollution. On Thursday, the U.S. Air Quality Index in New York City topped 100, which is considered unhealthy for sensitive groups, and is expected to remain elevated in the coming days.
Earlier this week, Hochul activated the state’s Emergency Operations Center to coordinate state and local agencies to ensure that the energy grid remains upright and emergency responders are available. Hochul also waived fees on state parks, pools and beaches.
As of Thursday afternoon, no city-permitted public events have been cancelled due to the heat, said Dela Cruz.
While Adams’ administration offered cooling centers and opened fire hydrants to help New Yorkers beat the heat this week, those services have the capacity to reach only a subset of the residents at risk of the adverse health effects of heat and pollution, many of whom have limited mobility. Otherwise, the Mayor’s Office of Emergency Management is relying on trusted-messengers to reach people and offer solutions.
“For all the concrete resources that the city provides, if someone does not want to leave their home for whatever reason...we also have messaging that's targeted to them and their providers,” said Dela Cruz.
At the center of that effort is the Advance Warning System, which notifies individuals and providers of extreme weather emergencies and encourages safe practices. As of Wednesday, the system had 6,236 individuals and 2,309 organizations on its distribution list, according to Dela Cruz. The city also provided about $1.5 million in grants across 37 nonprofits to develop emergency preparedness plans and support local community resources.
Along with cooling centers, of which roughly 550 were open Thursday, according to Dela Cruz, the city and state are focused on ensuring critical infrastructure holds up.
BIRTH CONTROL ACCESS: Attorney General Letitia James announced a $1 million settlement on Thursday with health insurance giant UnitedHealthcare for denying coverage of birth control pills. The attorney general’s office opened an investigation into the insurance company after it received a patient complaint stating that United’s Oxford health plan denied them coverage for birth control pills, delaying the patient’s access to care. The allegations violated a state law requiring health insurers to cover FDA-approved birth control methods without requiring co-pays, restrictions or delays. In addition to the $1 million penalty, UnitedHealth is required to pay back patients who were charged out-of-pocket expenses for contraception.
YOUTH MENTAL HEALTH: Gov. Kathy Hochul signed two pieces of legislation on Thursday to restrict social media companies from using addictive algorithms for kids and collecting their data. Hochul signed the new laws, which are a part of her attempts to combat the youth mental health crisis, alongside its sponsors Sen. Andrew Gounardes and Assemblywoman Nily Rozic, as well as Attorney General Letitia James. The bill follows a new city Health Department report released on Thursday showing that kids who use social media were more likely to experience depression or anxiety.
LEAD POISONING: The state Department of Health launched an advisory campaign yesterday to inform adult New Yorkers about how to prevent lead exposure. The campaign will aim to increase awareness about the health impacts of lead exposure, such as decreased brain or kidney function, and reach New Yorkers with jobs or hobbies that might expose them to lead, including construction or hunting. The agency plans to run a child lead exposure campaign later this month.
Amtrak train service between New Haven and Philadelphia and New Jersey Transit commuter lines are suspended while crews work to resolve an overhead power issue, creating massive rush-hour delays for travelers and commuters for the second time this week.
“A malfunctioning circuit breaker has caused a widespread issue, resulting in a loss of power on the tracks between New York Penn Station and Newark Union Station,” Amtrak said in a service advisory. “This issue will affect trains between Philadelphia 30th Street Station and New Haven Union Station. All services scheduled to travel in those areas are temporarily suspended until further notice.”
NJ Transit often blames Amtrak for disruptions as the national service owns and operates the tracks they share. At the end of May, Amtrak Chief Executive Stephen Gardner and NJ Transit President Kevin Corbett met to discuss how the two agencies can better work together when a disruption happens.
The rails that traverse the East Coast hit a choke point where the Hudson River separates New York from New Jersey. Both NJ Transit and Amtrak trains have to pass through a single, century-old tunnel to enter and exit Manhattan. One minor disruption to that narrow passage can affect multiple train routes and cause headaches for thousands of travelers.
A long-delayed $16 billion rail tunnel project for a new connection between the two states, known as the Gateway project, is designed to relieve the congestion. Earlier this month, it received the final nod from the federal government for a $6.88 billion full funding agreement.
The controversial gunshot-detection software purchased by the New York Police Department for $54.6 million generates constant false alarms that waste police officers’ time, according to an audit by the city comptroller.
Across eight months in 2022 and 2023, alerts from ShotSpotter sensors sent officers to investigate thousands of sounds that were never confirmed to be shootings, the audit found. In June 2023, for example, just 13% of ShotSpotter alerts were confirmed as shootings. The time spent – an average of 20 minutes investigating alerts later deemed unfounded and 32 minutes on alerts that were never confirmed as gunshots – added up to some 36 shifts for a single officer, the audit found.
The NYPD has contracted since 2014 with the California-based company SoundThinking, which has installed more than 2,000 of its gunshot-detecting ShotSpotter sensors in neighborhoods with high rates of gun violence. The city has paid $45 million for that work, with the total set to reach $54.6 million by the end of the current contract in December.
ShotSpotter technology promises to help police departments respond more quickly to shootings, and the audit by Comptroller Brad Lander found some success in that mission: officers responded about 90 seconds faster to ShotSpotter-detected shootings in June 2023 compared to the typical five-and-a-half-minute response time for 911 calls. (The NYPD itself does not track that difference, which auditors calculated for themselves.)
But between 80% and 92% of ShotSpotter alerts in the studied eight months were unconfirmed, amounting to 7,262 incidents where police responded but never uncovered any gunshots, the audit found.
“The evidence shows that NYPD is wasting precious time and money on this technology and needs to do a better job managing its resources,” Lander, who is reportedly considering challenging Mayor Eric Adams in 2025, said in a statement. “Chasing down car backfires and construction noise does not make us safer.”
SoundThinking strongly disputed the report’s conclusions. Tom Chittum, the company’s senior vice president for forensic services, said in a statement that Lander’s office wrongly implied that all unconfirmed shootings were false reports, and argued that the comptroller failed to acknowledge “lives saved” from the technology.
“ShotSpotter is both accurate and effective. It has been deployed in New York City since 2015, and over 170 cities rely on ShotSpotter technology to detect and alert law enforcement to instances of gunfire,” Chittum said. “Every day wherever ShotSpotter is deployed, our technology proves its reliability in detecting gunshots that helps first responders interrupt crimes, catch criminals, and save lives.”
The NYPD similarly defended the technology in its formal response to the audit, arguing that the comptroller underestimated the number of shootings detected by ShotSpotter since the audit only analyzed shootings that were confirmed at the scene. The department also argued that money is not wasted on the potential false alarms, since it assigns officers already on patrol to respond.
The NYPD’s contract with ShotSpotter does not count false positives against the vendor’s performance. The police department did add a new level of oversight in a 2021 contract renewal, giving it the right to withhold payments if ShotSpotter fails to detect 90% of outdoor gunshots in its target areas — but that standard is only geared toward avoiding missed incidents rather than minimizing false alarms.
For that reason, the NYPD has given ShotSpotter high marks for its contract success — in 2022, the company hit the 90% benchmark in most areas except for a few parts of Manhattan.
ShotSpotter does not relay every noise to the NYPD. Instead, when a sensor registers a potential gunshot, ShotSpotter’s employees review each sound, dismiss a majority of them, and then route the suspected shots to the NYPD, which sends them to the relevant precinct.
Though responding officers are already on duty, the comptroller’s office argued that the use of overtime may nonetheless increase at the margins. Police may be forced to spend more time responding to unconfirmed alerts and then conducting needless investigations, the office said. (The NYPD routinely overspends its allotted overtime budget, and had spent more than $700 million on overtime this fiscal year as of March, officials said.)
ShotSpotter has generated controversy in many of the 170 other U.S. cities where it is used. Some advocates argue the technology results in disproportionate surveillance in communities of color and note that it has resulted in at least one false arrest. Several cities, including Chicago and Houston, have taken steps to drop it in recent months.
The Fremont, Calif.-based parent company rebranded from ShotSpotter to SoundThinking last year, did not immediately respond to a request for comment.
The audit recommended against renewing ShotSpotter’s contract when it expires in December unless it first does a more thorough evaluation that considers its low rate of confirmed shootings. The NYPD disagreed in its response to the audit, saying canceling the contract would endanger the public.
An NYPD spokesperson said in a statement that “the department consistently reviews the effectiveness of technologies it utilizes to combat crime.”
“ShotSpotter remains an integral tool in the NYPD’s mission of addressing gun violence and keeping the public safe,” the unnamed spokesperson said.
The Battery Park City Authority’s plan to overhaul a more than mile-long stretch of Lower Manhattan waterfront is taking shape, with a mix of flood walls, deployable gates and streetscape upgrades to defend an area known for its waterfront access from increasingly severe coastal storms and rising sea level.
New project designs reviewed by Crain’s provide a look at changes proposed by the billion-dollar North/West Battery Park City Resiliency Project, which runs along Manhattan’s western shore from just above The Battery to Tribeca, where it would prevent flood waters from inundating office towers and residential buildings worth an estimated $13.8 billion.
In several places the proposed network of clay-colored walls and gates blend into the design of the esplanade, and are hardly noticeable at just a few feet high; in other areas, particularly the southern section near South End Avenue, walls between eight and a half and 10 feet hug the back of the waterfront plaza with a planned curation of trees and plants to soften the look.
Father north, bordering the Borough of Manhattan Community College, a more than nine foot wall hugs the building along West Street to reduce the visual impact of what was originally proposed to be a wall that towered over pedestrians near the northernmost section of the esplanade.
The project’s design, which is more than halfway complete, speaks to the combined engineering and aesthetic challenges of reinventing a bustling waterfront with functioning flood protections.
“We're trying to integrate this as much as possible into the natural landscape so that it doesn't read obviously as a flood barrier, it just becomes part of the overall urbanscape,” said Gwen Dawson, the authority’s senior vice president of design and construction, in an interview.
The Battery Park City Authority’s contractor-design team — led by Manhattan-based Turner Construction and E.E. Cruz & Company in Queens, and Amsterdam-headquartered Arcadis — also plan to take advantage of overhauling the waterfront walkways and plazas to enhance accessibility, add more seating, shade and modernize the area’s overall look.
If the resilience project receives public approvals without a snag, the authority says it expects construction to break ground in 2025 and last about five years. Construction would embark in phases to reduce the time visitors are cut off from accessing certain areas.
To limit risks and costs, the authority is utilizing a unique contracting method known as progressive design-build. The process allows the authority to move through the design phase before determining the project’s final costs. As a result, the project’s budget is in flux and likely to change, but Dawson said the current estimate is for at least $1.5 billion — roughly in line with a previous estimated price tag the authority shared with Crain’s last year.
To finance the project Gov. Kathy Hochul quietly bolstered the authority’s bond power in the April state budget by raising its debt capacity — the second time in as many years — up from $1.5 billion to $2.5 billion to help it carry out the flood protections. In its most recent bond sale last year the authority sold roughly $750 million worth of revenue bonds.
Raju Mann, president and chief executive of the authority, said the agency is developing a schedule for future bond sales and aims to be conservative with its spending.
“We have plenty of room in our bonding capacity to go significantly above projections for what we think the cost is going to be,” Mann said in an interview. “But I think the question for us is, how do we get the cost down as much as possible while still delivering the flood protection?”
Seeking to trim costs will also ideally compact the project’s timeline, said Mann.
“Construction is always a pain in the butt in New York,” said Mann, “but at the end of the day, this will be a better waterfront.”
The Durst Organization is no longer looking to sell its Long Island City luxury rental building known as Sven after landing a major refinancing package on the property from Wells Fargo, according to property records and a source familiar with the deal.
Wells Fargo has provided the major New York landlord with a $450 million loan for the 958-unit property, located at 29-59 Northern Blvd. in Queens, records show. Durst had been exploring a roughly $800 million sale of the building since at least the beginning of the year but views the refinancing as a better option and will hold onto Sven instead, a source familiar with the refinancing said.
A representative for Durst declined to comment on the refinancing and the company's plans for the building. A representative for Wells Fargo did not respond to a request for comment by press time.
A Newmark team led by Doug Harmon and Adam Spies had been marketing the potential sale of the property and arranged the refinancing package as well. The team declined to comment on the deal.
Even exploring a sale of the building was an unusual move for Durst, as the company very rarely sells any of its properties. It has been one of the city's most prominent family-run firms for longer than a century, with holdings including famed buildings like 1 World Trade Center and 1 Bryant Park.
Sven stands 71 stories tall, making it the second-highest building in Queens behind Court Square's Skyline Tower from developer Chris Jiashu Xu. Its apartments are split between 670 market-rate units and 288 affordable units, and it includes 15,000 square feet of retail space and a public park as well. Durst bought the site in 2016 for about $175 million.
There are 11 available apartments in the project, with rents ranging from $3,300 for a studio to $7,315 for a three-bedroom, according to StreetEasy.
Marianne Cucolo knows she’s a rabble-rouser.
For years she’s tried to stop the Kushners from building hundreds of homes in Colts Neck, New Jersey.
“When I see something is wrong I don’t go with the flow,” she said. “I fight it.”
But for all her fighting, the grandmother and educator is running out of options. The bucolic farm town about 50 miles from Manhattan, where Bruce Springsteen owns a home, Jon Stewart operates an animal sanctuary and former President Donald Trump has a golf course, is locked in a bitter fight between the developer and residents over a planned 360-unit apartment complex that is close to gaining final approval.
The town where the median home value exceeds $1 million currently lacks a sewage system, so Kushner Cos. — the family real estate developer once run by Trump’s son-in-law Jared Kushner — plans to build an on-site wastewater treatment plant. Residents and environmentalists say the discharge from the plant risks seeping into a reservoir serving more than 300,000 residents.
“It’s going to be catastrophic,” said Cucolo, who moved to the town of 10,000 people a decade ago to help care for her granddaughter.
Despite resistance, town officials have approved the development and advocates for the development say it’s important to help ease a housing crisis in the region and that the town should have created better infrastructure years ago. The project, which includes luxury apartments, also comprises 72 affordable units, which are “essential” to meeting the needs of low-income families after housing costs in the area skyrocketed in recent years, Kushner Cos. said in a statement to Bloomberg.
While the entire tri-state area is facing a housing shortage of about 540,000 residences, Colts Neck has seen home values rise by more than 50% in four years with only 42 properties currently for sale.
Rapidly expanding
New Jersey, the most densely populated state, requires that each town build its fair share of affordable homes. But dozens of wealthy communities have worked to delay or block their obligations set out in a series of court decisions stretching back almost 50 years.
Colts Neck brought this on themselves by not connecting parts of the community into sewage systems and instead using that lack of infrastructure to dodge their building obligations for decades, advocacy group Fair Share Housing Center said. In the past, Colts Neck paid other municipalities to take on their obligations, but updates to the law no longer allow it.
“You need the sewer to build multifamily housing,” said Josh Bauers, attorney at the center. “That has long been a tool of their exclusion.”
Town government officials declined to comment for this article.
Cucolo says she’s not fighting Kushner because of Nimbyism, a term for those opposed to something undesirable being built in their community. She points to environmental group Sierra Club calling the Kushner project a “disaster” and the League of Women Voters warning that a protected stream that feeds the Swimming River Reservoir runs through the plot of land that includes the development.
Hazardous sites
New Jersey has the largest number of hazardous waste sites in America, including one in Colts Neck.
“All good people support affordable housing,” said Kip Cherry, conservation chair of Sierra Club’s Central Jersey chapter. “But affordable housing should be in locations that are good for the people.”
Kushner Cos. is committed to ensuring the property is “operated with the highest level of professionalism and care for the surrounding community,” Michael Sommer, chief development officer, said in his statement.
The development was originally approved by the town in 2007 for only 48 units. But after the Kushners sued the neighboring town of Freehold to gain access to its sewers, and were counter-sued by Freehold, Colts Neck approved the larger complex in 2021 with the waste treatment facility known as an Amphidrome. Plans now include a 15-building development that includes a club house and swimming pool.
The developer has been rapidly expanding its footprint in New Jersey after Jared stepped down to follow Trump to the White House in 2017 and the company pulled back from some large New York City tower bets. This year alone it kicked off two major projects in Monmouth County, home to Colts Neck, including a $500 million conversion of a mall into a new town center and a 299-unit retail and apartment development in Long Branch.
Last hurdle
Over the past three years, Cucolo has tried everything to stop the development, from raising $14,000 for an independent hydrology report to collecting 2,400 signatures in a change.org petition.
She even asked her friend who lives next door to Springsteen if she would “walk among the peacocks and ask if he’d give us a hand.” Her neighbor declined. His publicist also declined a request for him to speak with Bloomberg.
Residents have packed hearings in a drawn-out review process. Several years and permit approvals later, the last hurdle for the Kushners is to gain consent for its wastewater plans by New Jersey’s environmental protection agency.
Cucolo hopes the state will require the Kushners hire an independent company to review the project.
“I’m the troublemaker,” she said, insisting it’s for a good cause. “They’ll contaminate the reservoir and we’ll be paying for it for years to come.”
Alberto, the summer’s first named storm, this week soaked the streets of Austin. Inside a Hyatt Regency with an unobstructed view of the Texas capital’s shiny new skyline, real estate leaders from around the country gathered to lament the hard rain falling on their business.
Higher interest rates have thrown a wrench into the housing market. A massive class-action settlement last year dealt a devastating financial and reputational blow to Realtors for overcharging customers. And affordable space is scarce pretty much everywhere, unless it’s in an office building.
“It’s a confusing time,” Shae Cottar, a Houston real estate broker, said during a panel at the National Association of Real Estate Editors’ annual conference.
Confusion is particularly acute because, against all previous experience, the office sector is slowing while the overall economy remains strong.
It’s “something I haven’t seen in my 30 years as a real estate economist,” declared Richard Barkham, CBRE’s global head of research, who is forecasting more unusual weather.
Retail, residential and industrial real estate remain “fundamentally sound,” Barkham said four times in his 30-minute presentation, but office remains the problem child. So long as lenders are willing to extend maturing loans and avoid imposing new mortgages at higher rates, problems should remain contained, Barkham assured.
“I expect by 2025, the story will be 20% vacancy, but we won’t have enough office space either,” he said. “We won’t have enough of the kind of space that businesses want to lease.”
Residential real estate is grappling with the brave new world of 7% mortgage rates. Housing prices remain astronomical in New York. But they have fallen 9% in Austin, the most of any major market, said Odeta Kushi, an economist at First American Financial.
And then there’s the mess from last year’s earthquake in the residential brokerage world, when a federal court in Missouri ruled that brokers conspired to keep commissions artificially high and extracted $100 billion annually in unjust fees from homebuyers nationwide. The National Association of Realtors paid $1.8 billion to settle the matter, and the Justice Department is considering action. Hand-wringing among industry experts was genuinely impassioned at the real estate conference inside the Austin Hyatt Regency, a 448-room hotel with glass elevators that is owned by the same real estate investment trust that has the Marriott Marquis in Times Square.
“Will real estate agents go the way of travel agents?” a moderator asked a panel of brokers, who agreed that wouldn’t happen. But “we’re going to work harder for less money,” said Mike Crowley, past president of the National Association of Exclusive Buyer Agents.
Ben Caballero, CEO of HomesUSA.com, who over the past 20 years helped sell more than 60,000 homes, suggested brokers have what’s coming to them because they didn’t cut fees even as the rise of virtual tours meant buyers no longer needed one to see inside a home.
“It makes it difficult for [brokers] to get their buyers or sellers to understand the value that they are delivering,” he said.
Only time will tell, said, Mauricio Umansky, star of Buying Beverly Hills.
“More negotiable doesn't necessarily mean a lower price,” he said. “It just means more negotiable.”
Amy Froelich and her wife Marla have been Airbnb hosts since 2015. They started in Iowa City, Iowa, and continued on to Madison, Wisconsin, where they own a four-bedroom home in a lush neighborhood within walking distance of trails and shops.
On weeks their house isn’t rented out, they open it up for free home swaps through HomeExchange — an online travel hack they stumbled onto three years ago that lets them leverage their place for free accommodations elsewhere.
“We were just in a home exchange outside of Glasgow, Scotland. This beautiful couple, Claire and Michael, greeted us at the door with homemade bread that she’d just pulled out of the oven,” says Amy Froelich, speaking to Bloomberg from the U.K., a day after her stay concluded. The hosts couldn’t vacate on the agreed dates, but they offered the couple up a loft area with a master bedroom and en suite bath. In exchange, they’ll get to stay at the Froelichs’ home at a future date of their choosing. “It’s much more than monetary value,” says Froelich. “We departed as lifelong friends.”
Offering your home in exchange for a stay at someone else’s place is far from a new concept, but this oft-forgotten segment of the travel industry is booming amid high inflation, the normalization of remote work and skyrocketing hotel rates. Also contributing to the trend is increased frustration with short-term rentals and the growing regulation of rental homes in major cities.
In conversations with four home exchange companies, all reported either double- or triple-digit growth in 2023, compared with the previous year,based on the number of members or home swaps made on their platforms.
Kindred, an invitation-only membership platform founded in 2022 with access to 30,000 homes in 100 cities, saw home swaps grow by 800% year-over-year in 2023. The San Francisco-based startup has raised $26 million; early investors include Andreessen Horowitz, the same firm that contributed $112 million to Airbnb’s Series B funding round in 2011.
The model of Kindred is similar to those of pioneers such as HomeExchange and Third Home in that users earn “credits” for hosting other members in their homes; credits can then be redeemed for stays elsewhere. Kindred’s twist is that it doesn’t charge an annual membership fee; it makes money mostly from service fees.
HomeExchange, founded in 1992, experienced a 53% jump in swapsin 2023; it has more than 170,000 members in 140 countries. In 2022, it added a premium tier to its standard $220 annual membership; for $1,000, HomeExchange Collection opens the door to 5,000 luxury homes that average $2.5 million in value. Think urban penthouses, castles and wilderness retreats.
That move challenges ThirdHome’s competitive advantage as a platform exclusively for luxury homeowners; its 17,500 vacation homes in 100 countries are worth a minimum of $500,000 and top out in excess of $50 million, including yachts. Membership costs $295, with service fees for each swap ranging from $495 to $1,395 per week. It, too, has grown: Members increased by 41% and exchanges by 16% in 2013, compared with 2022.
“We’re growing, we’re hiring people and we've been profitable for five years now,” says Wade Shealy, who started ThirdHome in 2010 with a portfolio that consisted of a couple of friends’ homes.
Where home swapping struggles is in reputation. Many view it as an unglamorous option for budget-strapped travelers, with risks of property damage. Insiders, however, have realized—and this has propelled the sector’s growth—that the opposite can be true when swapping members are well vetted.
A human connection
Rachel Lipson says her family of four has saved tens of thousands of dollars since she started swapping her Brooklyn, New York, home in 2022. She uses the Barcelona-based, invitation-only home exchange platform Behomm, which charges an annual membership fee of about $400 and focuses on the homes of creative people and design lovers.
“I found it a little overwhelming at first,” says Lipson. “How am I going to let some random person stay in my house? It was hard to trust that it was going to be OK.”
When she received an initial swap request from a Behomm member located in Marrakesh, Morocco, the day before her family was to visit Los Angeles, Lipson decided to hear it out. “We did FaceTime just so we could talk — and we felt really good about it, so we said yes,” she says. The family stayed in her home while she was at a hotel in L.A. On spring break the following year, Lipson’s family stayed at that member’s house in Marrakesh.
So far, Lipson’s family has swapped homes with members in 16 destinations, including Paris; Montreal; Punta Cana, Dominican Republic; Cancun, Mexico; and Reykjavik, Iceland. When preferred dates aren’t available, Lipson looks at hotels and Airbnb. “Some of these homes, you wouldn't find them for rent,” she says. “And it’s like staying at a friend's place while they're out of town. You really get to know people, and that's an experience that I've never had with Airbnb or hotels. It's really its own thing.”
An evolving lodging scene
If the economy goes down, ThirdHome sees its inventory goes up, says Shealy. “About half of our members have their vacation homes on short-term rental platforms, and if they're not renting them out as much, they get more availability to throw it into the system.”
To raise awareness, ThirdHome is now offering a free yearlong membership to people who are buying new vacation homes at, say, Rosewood or St. Regis resorts. Developers report that the perk is helping them close additional transactions. “We get about 500 new members a month right now, just from our [commercial real estate] partnerships,” Shealy adds.
Kindred, by contrast, is more concentrated in big cities; it has enjoyed the most significant growth in Los Angeles, New York and London. “I can't say if it's necessarily because of Airbnb getting pushed out,” says Justine Palefsky, who co-founded the company in order to facilitate a multicity lifestyle that didn’t require taking out multiple mortgages.
Even if short-term rentals remain legal in some of these markets, Palefsky says she’sseen members gravitate to Kindred because they’ve grown tired of Airbnb and its competitors. High prices and a desire to get value from their homes “without feeding the beast of the vacation rental,” she says, is forcing consumers to seek out alternatives.
Airbnb denies that its appeal has become diluted. “With over 7.7 million listings and over 1.5 billion guest arrivals in almost every country across the globe, we believe we give travelers the option to experience local communities in many more places than any other travel site, while providing important safeguards to help protect their trip,” a spokesperson said.
Weighing the risks
As do Kindred, ThirdHome and HomeExchange, Behomm’s founder insists that care is taken to ensure that each member is vetted, from verifying identity documents to screening home photos, among other security measures.
Still, home exchanges can be trying. Finding a home swap in your chosen location can be time consuming, and availability is far from guaranteed.
“I probably spent three hours just sending requests,” says Marla Froelich of her hunt for accommodations in Scotland.
Frequent swappers say mishapscan happen — spilling wine on a designer couch or placing an electric kettle on a stove — but tend to be quickly resolved. The bigger risk in swaps is major property damage or bodily harm while a guest is looking after a home.
A number of home swapping platforms offer host protection, covering up to $100,000 in damages on Kindred to $5 million on ThirdHome. Andsome homeowners and rental policies include coverage for damage by third parties, as well.
Those who navigate these finer points can find home swapping an open door to nearly free stays in some of the world’s most coveted destinations.
In September, for instance, the Froelichs will head to Bali, Indonesia. A family from Australia that spent a week at their home a year ago via HomeExchange offered a swap at their family’s vacation home in Indonesia. “We told them we couldn’t make it [to Bali] for at least another year, and they were like, ‘We don’t care when you come, just tell us. Our driver will take you wherever you want, we’ll set you up with anything.’” That’smore than even most luxury hotels offer.
The developers behind a new Atlantic Avenue mixed-use tower have inked long-term leases for the building's first retail tenants, commercial broker JLL has exclusively told Crain's.
Manhattan-based real estate investment group Hope Street Capital will soon welcome Brooklyn's largest hospital system, Maimonides Health, to 809 Atlantic Ave., along with fast food chain Chick-fil-A and doggie day care center Hounds Town. The companies will together occupy 36,000 square feet of retail and office space in the new Clinton Hill development that also includes a fully leased and already-occupied residential portion.
All three tenants signed leases for 15 years or longer and are slated to open by the end of this year, some as early as the end of the summer, according to Hope Street Capital partner Sha Dinour.
"This is the first time anyone is occupying the retail part of the building. It just finished a few years ago," Dinour told Crain's. "The rapid lease up of the retail space is reflective of the strong demand for best-in-class concepts among the very fast-growing residential population leading the neighborhood's transformation."
Maimonides Health will take over the entire second floor of the building on a 25,000-square-foot lease for a healthcare center offering primary care, surgical and OB/GYN services. The expansion will allow the healthcare system to provide more people with more care across the borough, according to president and CEO Ken Gibbs.
Chick-fil-A, the Georgia-based fast food chain, will occupy 5,000 square feet on the ground floor, and Hounds Town has signed a lease for all 6,000 square feet of the lower level, where it will offer doggie daycare, overnight boarding and pet spa services. There is still 8,000 square feet of retail space available in the project.
The building sits across the street from the site of a contentious rezoning proposal to replace a drive-through McDonald's with housing. It's also just a stone's throw from the start of the Vanderbilt Avenue Open Street that bans cars from spring through fall, allowing pedestrians and cyclists full rein of the roadway.
And less than a mile away is another Brooklyn Chick-fil-A at 166 Flatbush Ave. That franchise is "actually one of the top performing" in the country, according to JLL's senior vice president for retail Ryan Condren.
Developed by Hope Street Capital and designed by Morris Adjmi Architects, 809 Atlantic Ave. is a 29-story mixed-use tower whose residential portion is known as The Axel. It boasts 284 apartments, a pool and sundeck, a game lounge and a fitness center.
The retail portion on the first two floors spans a full block between Vanderbilt and Clinton avenues with frontage on Atlantic Avenue.
Getting the apartments filled was crucial to landing the successful retail tenants, according to Condren.
"Retail really follows residential," he said.
In the wake of two high-profile building collapses last year, the City Council passed a bill Thursday that overhauls the Department of Buildings’ inspection system by requiring the agency to investigate properties proactively.
The bill tasks the DOB with identifying hazardous buildings using predictive technology, weighing factors such as the building’s age and materials, its history of violations, 311 complaints, and the disciplinary histories of design professionals and contractors who have worked there.
Until now, the DOB has largely been a “complaint-based agency,” relying on members of the public and elected officials to flag potential structural hazards in buildings, DOB Commissioner James Oddo said at an April council hearing on the bill.
“We need to free up a group that is on offense … to look at high-risk locations, to use predictive analytics to identify potential problematic buildings beforehand,” Oddo said, praising the goals of the bill by Bronx Councilwoman Pierina Sanchez.
Oddo initially had reservations about the legislation, saying that taking on the new responsibilities without extra funding “will strain our existing inspectorial resources.”
Now, Mayor Eric Adams’ administration has committed $4.7 million in funding to staff the proactive inspection programs, resolving Oddo’s concerns, DOB spokesman Andrew Rudansky said Thursday. Oddo said in a statement that “the creation of a proactive building inspection program will be transformative, allowing us to investigate potential structural issues and protect New Yorkers from dangerous building conditions that could turn deadly.”
Sanchez has called her bill a necessary response to last year’s startling events: the January cave-in at a Lower Manhattan parking garage that killed one man, and the December partial collapse of a Bronx apartment building that left multiple families homeless.
“The city is home to over 1 million buildings with approximately 75% built before 1960. We must ensure that these are all structurally safe and sound,” Sanchez, whose Bronx district includes the partially collapsed building, said in April. “Without that, we risk endangering any person walking by a building or those who live or work inside.”
The collapse at 1915 Billingsley Terrace raised questions about why the city had failed to spot structural problems in advance, given that inspectors had previously flagged cracked bricks and a bowed roof when examining the building’s facade. In February, the city suspended the license of the independent engineer who had conducted one of those prior inspections, saying he had mistakenly described a load-bearing column as decorative.
The bill which unanimously passed the full City Council Thursday afternoon, will require the DOB to inspect buildings where the predictive model flags potential hazardous conditions. If the DOB issues violations based on the new inspection program, landlords must submit corrective action plans within 30 days including timelines for repairing each problem.
Sanchez’s bill has undergone amendments in recent weeks in response to feedback from the DOB. The factors to be included in the predictive model no longer include a building’s number of floors and inhabitants or the date of its most recent alteration, and the bill no longer bars DOB from issuing non-emergency work permits to buildings with uncorrected violations.
The Buildings Department has said it already does some proactive work through its Construction Safety unit, but it is limited to construction sites rather than existing buildings. Landlords are also required to do their own proactive inspections on elevators, boilers, gas lines and pipes.
City lawmakers have also applied new scrutiny to garages following the collapse at 57 Ann Street. In May, the council passed three bills requiring DOB to conduct a load-bearing capacity study for parking garages, doubling civil penalties for some violations issued to garage owners, and increasing the frequency of structural inspections at garages from six years to four years.
Oddo, the Buildings Commissioner, announced in April that the Ann Street collapse was not caused by an overloading of cars as officials had initially indicated. Oddo would not say whether a different cause has been identified, since an investigation is ongoing by the engineering firm that the city hired last year to investigate what went wrong.
Leases
Law firm expands Midtown footprint
Address: 1040 Sixth Ave., Manhattan
Landlord: Skyline Developers
Tenant: Meirowitz & Wasserberg
Lease size: 12,007 square feet
Asset type: Office
Brokers: Newmark's William Cohen, JD Cohen and Ariel Harwood represented the landlord.
AV firm renews with GFP
Address: 171 Madison Ave., Manhattan
Landlord: GFP Real Estate
Tenant: Presentation Products
Lease size: 6,196 square feet
Lease length: Seven years
Asset type: Office
Brokers: Newmark's Jordan Gosin and Michael Horn represented the tenant. Allen Gurevich represented the landlord in-house.
Financings
Sant Ambroeus Madison and The Mark secure financing
Address: 1000 Madison Ave. and 21-35 E. 77th St., Manhattan
Owner: Alexico Group
Lender: Goldman Sachs
Loan amount: $410 million
Asset type: Hotel and restaurant
Flatbush project gets construction loan
Address: 2700 and 2716 Church Ave,. Brooklyn
Owner: Pinches Abowitz
Lender: S3 Capital Partners
Loan amount: $32 million
Asset type: Mixed-use
Prosecutors dropped charges on Tuesday against one of the six people indicted last year for orchestrating an illegal donation scheme to Eric Adams’ mayoral campaign in hopes of winning favors from his administration.
Ronald Peek, 66, had been accused of helping the other defendants make “straw donations” to the Adams campaign by falsifying contributions, and directing two businessmen to funnel donations through their construction company.
But a prosecutor for the Manhattan district attorney’s office said Tuesday that Peek had no criminal record and has a history of government service, and that Peek did not profit from the scheme, the Daily News reported. Four of the other defendants have pleaded guilty to a range of charges, while another defendant is still fighting the charges against her.
“My client is looking forward to moving on now that he has been able to clear his name,” said Ian Miles, Peek’s attorney, in a statement. “We thank the court as well as the Manhattan District Attorney’s office for its thorough investigation that led to this dismissal.”
Peek formerly worked for multiple Florida governors and for Gov. Mario Cuomo, according to Peek’s spokesman Richard Bamberger.
Manhattan D.A. Alvin Bragg announced the indictments last July. Neither Mayor Eric Adams nor his campaign have been accused of any wrongdoing, although the case verged uncomfortably close to the mayor’s personal circle — one of the people charged, retired police inspector Dwayne Montgomery, knows the mayor personally and had spoken to him since he became mayor.
Montgomery and two of the other defendants have since been sentenced for misdemeanor conspiracy charges, while another participant, Shamsuddin Riza, pleaded guilty in April to a more serious felony charge of falsifying business records, as well as third-degree attempted grand larceny.
The last remaining defendant, Millicent Redick, is still maintaining her innocence and told the Daily News this week that she only got swept up in the donation effort as part of a desperate attempt to secure repairs for her deteriorating Harlem apartment complex. Redick has declined a misdemeanor plea deal, the Daily News reported.
Prosecutors said last year that the defendants took advantage of the city’s matching funds program, which pairs every $250 campaign donation from a New York City resident with $2,000 in public funds. They tried to boost Adams’ campaign “as leverage in potential future requests of the mayor’s office,” Bragg said in July.
City law limits individual contributions to $2,000, or a stricter $400 for people who own a business that vies for city contracts. The indictment alleged that the defendants recruited donors and falsely listed contributions in their names to go well beyond those limits.
This particular straw-donor case was eclipsed within months by revelations that federal authorities had opened a probe into the Adams campaign for possible illicit dealings with the government of Turkey. Agents from a different U.S. attorney’s office in Brooklyn are also reportedly investigating one of Adams’ aides, Winnie Greco, whose home was searched by the FBI in February.
The Adams administration has launched a competitive search for new vendors to care for asylum seekers now that the city is scaling back its no-bid, emergency contracts with the troubled health care company DocGo.
The city released a request for proposal Tuesday calling for bids from organizations to provide shelter and supportive services to migrants. The new procurement approach comes after the Adams administration has taken heat for its reliance on costly non-competitive emergency contracts to address the city’s migrant crisis; DocGo, as a result, procured a $432 million contract, with initially limited oversight, under which it grew to serve some 3,600 migrants.
Officials in the Adams administration did not explicitly mention DocGo in its announcement and cast the call out to companies as a way to cut costs while expanding the city’s pool of vendors. DocGo is eligible to re-bid for the contract.
“This RFP will allow us to take a wider look at providers in this space and continue to evaluate how we are allocating resources to find additional cost savings and process improvements,” said Deputy Mayor for Health and Human Services Anne Williams-Isom in a statement.
DocGo spokeswoman Andrea Hagelgans said executives at the company “welcome a competitive bidding process” and “will review the RFP and determine whether to re-bid.” Indeed, DocGo’s CEO Lee Beinstock said at the company’s annual shareholders meeting Tuesday that the firm expects its growth will be “largely driven by our pipeline of municipal RFPs for larger, more sustainable behavioral health and population health programs.”
In April, City Hall declared that it would not renew the healthcare company’s $432 million contract to provide services to migrants when it expired in May. Instead, city officials said they’d use an existing contract with Garner Environmental Services to care for some migrants for at least three months while officials identify vendors to take over the work.
Prospective contractors would provide services — meals, laundry, clinical care and more — at current and possibly new migrant centers throughout the city. The initial contract term is for 12 months, but could be extended.
As part of the contract vendors would also be on the hook to develop and maintain a database that provides the city with real-time program statistics, including the daily number of active guests, number of occupied and vacant rooms, meals served, case management sessions, and other onsite services, in addition to “regular reporting on program activities, outcomes, and challenges,” according to the RFP.
The request for proposal has no deadline; bids will be reviewed on a rolling basis.
“Successful bidders must be capable of navigating complex situations with cultural competency and compassion,” the RFP states.
The city, meanwhile, hasn't completely cut ties with DocGo. The company is still providing care to migrants in the city and upstate while the Adams administration works to transition away from its services.
That includes services as part of a separate, nearly $41 million no-bid contract with the city to run a major center for asylum seekers in Long Island City, Queens. DocGo has quietly operated the 2,400-bed site for the city since September; the contract was finalized this month. City Hall says it will rebid the center’s operations once DocGo’s contract expires in September.
Under the contract city taxpayers are on the hook for some eye popping salaries for DocGo staff. That includes $1,140 each day for a social worker, $1,040 per day for six individual supervisors and $1,000 a day for a program director; DocGo also bills the city $400 a day for its lowest paid staffers, roughly 40 administrative workers, in what works out to $50 an hour, according to newly public city contract records.
Despite the rocky year, Beinstock described 2023 as “a standout year for DocGo” and touted the company’s 2024 first quarter revenue of $192.1 million at the annual shareholders meeting.
But DocGo’s stock has suffered through a spate of migrant services controversies and it’s currently just above $3 a share — down from $8.90 a year ago and from a high of $10.82 per share in October 2022. Still, some leadership at the company has managed to hold on, even as investors have filed a class-action lawsuit against the firm, seeking to recoup losses they say they suffered after the company’s stock fell in the wake of sour news coverage.
Proxy adviser Institutional Shareholder Services urged investors at the annual meeting to withhold votes to reelect the board’s chairman, Steven Katz, and to vote against Beinstock’s pay (his total compensation was $11.54 million in 2023), but shareholders did not buck the company’s management and voted in favor of both measures, according to preliminary results.
Beinstock sought to spin the Adams administration’s decision to wind down its relationship with DocGo as a strategic move.
“We are currently working with our partners at New York City to transition certain migrant services projects,” Beinstock told shareholders, “which will enable us to focus our energy, resources and passion to drive continued growth in our base medical transportation and non-migrant mobile health business lines.”
The City Council is urging Mayor Eric Adams to change rules under the city’s health plan that it says deny coverage for gay male couples looking to start a family.
Although the city’s health plan covers fertility benefits including in-vitro fertilization, which fertilizes eggs in a lab, Council members say that gay male couples can’t access the benefits because they don’t meet an outdated definition of infertility.
The city’s insurance plan covers up to three cycles of assisted reproductive treatments, which can include IVF. But under state law mandating fertility benefits, employees are required to prove that they have a diagnosis of infertility to get that coverage, meaning that they are unable to get pregnant after a year of unprotected sex.
That definition can include heterosexual couples, same-sex female couples and single women but it prevents gay male couples from qualifying for coverage, the Council said.
A new bill sponsored by Councilwoman Lynn Schulman, who represents parts of eastern Queens, is trying to expand IVF coverage to gay men. The proposal would require the city to cover the costs of IVF or other fertility treatments regardless of an infertility diagnosis, which Schulman said would effectively prevent discrimination based on people’s marital status or sexuality.
“It’s clear that confusion remains over what is covered and how much is covered,” Schulman said at a hearing on Tuesday. The new legislation would clarify the criteria and costs, ensuring people are not denied coverage, she added.
The city refuted claims that its current insurance practices are discriminatory. An infertility diagnosis, for instance, is not the only pathway to obtain coverage for IVF, said Daniel Pollak, first deputy commissioner at the Office of Labor Relations.
All individuals receive the same benefits regardless of their sexual orientation, Pollak said. But he noted that the city does not pay for procedures performed on individuals who aren’t covered by its health plan, making the costs of obtaining a surrogate to carry a pregnancy or a sperm donor ineligible for reimbursement.
The city has stopped short of covering those procedures because of the costs, Pollak added. A donor egg could cost anywhere from $10,000 to $30,000, and frozen sperm could cost up to $3,000.
Of the $11 billion the city spends on health benefits each year, about $50 million goes towards fertility benefits, according to Pollak. Roughly 3,000 municipal workers, dependents and retirees use fertility benefits, approximately 3% of the city’s total covered population.
The Council is not the only party pushing back on the city’s coverage practices. The Adams administration is also facing a class action lawsuit filed by Corey Briskin, a former Manhattan assistant district attorney, and his husband Nicholas Maggipinto, who said they were not eligible for IVF coverage because neither was diagnosed with infertility.
“For most city employees who earn modest salaries, it’s impossible to grow their families through IVF without coverage,” Briskin testified at Tuesday’s hearing. Briskin and his husband were forced to delay having children for years due to the cost, he said.
The average individual in the U.S. pays roughly $15,000 for a single cycle of IVF, according to the Association of Reproductive Medicine. People must often go through more than one cycle before they successfully have a baby.
Briskin added that the city’s claim that an infertility diagnosis is not needed to receive IVF coverage is inconsistent with what he and his husband were told when they were first denied coverage back in 2021, and called for clarity and equity in coverage policies.
The attention on fertility coverage comes as IVF has become a target of the anti-abortion movement. U.S. Senate Republicans voted last week to shut down a bill that would have protected access to IVF, on the same day that the Southern Baptist Convention – the country's largest Protestant denominations – voted to oppose the procedure.
Since February, Kathy Xiang and her entire family has been under siege.
Her 12-year-old daughter has had whooping cough, rhinovirus and parainfluenza: She's missed more than five weeks of school in total. Xiang, a software developer in Shanghai, caught all three too. Her elderly parents, who were helping care for her 10-month-old, tested positive for Covid-19 in early March, and her father got shingles.
Then the baby caught parainfluenza and pneumonia, necessitating five days on an IV drip. “I was literally numb after the baby boy got sick despite all our efforts to protect him,” Xiang said. “I was physically and mentally exhausted.”
Around the world, a post-Covid reality is beginning to sink in: Everyone, everywhere, really is sick a lot more often.
At least 13 communicable diseases, from the common cold to measles and tuberculosis, are surging past their prepandemic levels in many regions, and often by significant margins, according to analysis by Bloomberg News and London-based disease forecasting firm Airfinity.
The resulting research, based on data collected from more than 60 organizations and public health agencies, shows that 44 countries and territories have reported at least one infectious disease resurgence that’s at least ten times worse than the prepandemic baseline.
The post-Covid global surge of illnesses — viral and bacterial, common and historically rare — is a mystery that researchers and scientists are still trying to definitively explain. The way Covid lockdowns shifted baseline immunities is a piece of the puzzle, as is the pandemic’s hit to overall vaccine administration and compliance. Climate change, rising social inequality and wrung-out health-care services are contributing in ways that are hard to measure.
Covid-19 is the first major global pandemic in the era of modern medicine, so there's little precedent for what comes after. “The last major devastating flu pandemic was in 1918. There was no vaccination, no diagnostics or treatments. So we are in a new territory here,” said Jeremy Farrar, the World Health Organization’s chief scientist.
Comeback Diseases
Influenza cases in the U.S. have jumped about 40% in the two post-Covid flu seasons, compared with the prepandemic years, according to clinical lab results. Whooping cough, or pertussis, cases have climbed by 45 times in China in the first four months compared with last year. And in some parts of Australia, where flu season is just getting underway, cases of respiratory syncytial virus, or RSV, have nearly doubled from a year ago.
Argentina is battling its worst-ever dengue outbreak. Japan is seeing a mysterious surge of Streptococcal A, also known as strep throat. Measles is making a comeback in more than 20 American states, the UK and parts of Europe. Globally, 7.5 million people were newly diagnosed with tuberculosis in 2022 — the worst year on record since the World Health Organization started global TB monitoring in the mid-1990s.
The theory of immunity debt has become a popular, if controversial, explanation for the post-Covid surge in illnesses. It basically means that pandemic lockdowns offered an artificial layer of insulation from routine pathogens but left people more vulnerable when the world reopened. The effect is worse for young kids, whose brand-new immune systems were cosseted by social distancing, online classes and masks.
“It’s like the walls of the immune system are broken, so all kinds of viruses can easily get in,” said Cindy Yuan, an internal medicine doctor in a private clinic in Shanghai. In some months, she says, her patient load has doubled from pre-Covid levels. “It’s nonstop. From last autumn’s mycoplasma infections to flu and Covid during winter, and then whooping cough and various kinds of bacteria infections.”
That’s been the leading explanation for the extra traffic at pediatric hospitals globally since the 2022 flu season and for why respiratory pathogens returned with such a vengeance, like in China’s first post-Covid Zero winter last year.
Public health experts aren’t convinced. Immunity debt might account for some resurgence of illnesses reported post-Covid, but probably not all of it, said Ben Cowling, chair of epidemiology at the University of Hong Kong’s School of Public Health.
“Immunity debt, it definitely happens, but I don’t think it results in enormous epidemics after Covid,” he said, adding that greater surveillance and testing could also contribute to higher reported numbers.
What’s more, if immunity debt were the only factor, the countries that lifted pandemic restrictions two or three years ago should be caught up by now, and they're not. The waves of illnesses keep coming.
So do fatalities. A sustained rise in mortality levels in some countries is fueling another theory, that pandemic lockdowns essentially kept some people alive who may have died in a normal environment with freely-circulating viruses and bacteria.
The biggest risk
Canada, Japan, Singapore and Germany — places lauded for their successful efforts to contain Covid — are now seeing unusual levels of excess mortality, said Christopher Murray, the Washington-based director of the Institute for Health Metrics and Evaluation. In contrast, places that failed to control the spread of Covid, like Bulgaria, Romania and Russia, are now back to pre-pandemic mortality rates.
“Why would it be worse in places that did a good job? That seems a bit strange. Some of this is the idea that those countries kept frail, elderly people alive,” Murray said. Mixed with the immunity debt theory, “it’s a really quite complicated set of things going on,” he said.
Then there’s the unquantifiable role of poverty, which has spiked globally in the aftermath of the pandemic. Social inequality is the “biggest risk factor” for infectious disease, said David Owens, co-founder of OT&P Healthcare in Hong Kong. Overcrowded living conditions and poor access to high-quality nutrition adds to illness, increasing the amount of viral and bacterial pathogens in societies. And the ensuing strain on public health-care systems drags down the quality of care for everyone.
“Having vulnerable populations which allow an epidemic to take hold or accelerate increases risks for everybody,” Owens said.
Missed shots
The spikes in preventable illnesses, like measles, polio and pertussis are easier to explain, experts say. Vaccination rates fell sharply during the pandemic, with supply chains disrupted, resources diverted and immunization services limited by lockdowns, Cowling said.
At the same time, a growing number of children live in conflict or fragile environments, limiting ready access to vaccines. And Covid-era misinformation fueled simmering mistrust in vaccines in general.
About 25 million children missed at least one dose of the three-shot diphtheria, tetanus and pertussis vaccine in 2021. The percentage of children who received all the three doses of this vaccine dropped to 81%, the lowest level in 13 years.
UNICEF Executive Director Catherine Russell called it “a red alert for child health” in July 2022. “The consequences will be measured in lives,” she warned then.
Pertussis, which can induce coughing fits so violent that patients have been known to break their ribs, has been staging a global comeback. Deaths, usually in young babies who struggle to breathe, have been reported in China, the Philippines, the U.K., the Czech Republic and the Netherlands. Canada, South Africa, Bolivia, the U.S., Malaysia and Israel have all seen resurgent outbreaks.
Measles — identified through a distinctive dotted rash, coughing and a fever that can be deadly for young children — is an extremely contagious virus, requiring a very high threshold vaccination rate of about 95% in young children to stop its spread.
In the UK, coverage for the second measles dose was just over 84% in 2022-23 for five-year-olds, far below what’s needed for community protection. In Europe, more than 1.8 million infants in Europe missed their measles shot between 2020 and 2022, and the region saw a 30-fold spike in cases last year. The US eliminated measles in the year 2000, but the disease has returned after a dip in kindergarten inoculation.
Measles, says University of Illinois epidemiologist Katrine Wallace, is an early warning sign, the first indication that vaccination rates are dropping to the point that other diseases are going to come back.
“Every one of these diseases has kind of its own story, its own risk factors, its own geographical considerations,” Wallace said. “It’s like putting together a series of puzzles.”
Sick days
The consequences of Covid can be thought of as “a series of concentric circles,” said WHO’s Farrar. The acute public health emergency has ended, but the knock-on effects persist.
The state of constant illness already is taking a toll on businesses and the economy. Nearly one in three US employees in white-collar jobs took at least one sick day in 2023, according to payroll company Gusto, up 42% from 2019. And when they missed work, they missed more of it, with the average absence up 15%. And a UK study found workplace absences at the highest rate in over a decade, with employees missing nearly eight days on average over the past year, up from six before the pandemic.
To move past the current situation, rebuilding society’s trust in vaccines is an absolute must, said Farrar. “We’ve got to make the case for science and for vaccines and explain and explain and explain the importance. We can’t just say some people are anti-science or anti-vaccine and forget them,” he said. “We need to listen, explain, and try to reach everybody.”
Despite the speed with which countries around the world left Covid-era protections behind, the lingering trail of sickness, along with the thousands of Covid deaths each month, shows that the pandemic has cast a long shadow. The Spanish flu persisted for roughly three years, IHME’s Murray said.
Given three years have already passed since Covid arrived, “we were very surprised with the 2023 patterns in some of these countries,” he said. “Maybe we have more surprises coming.”
Data Methodology
Bloomberg News collaborated with Airfinity to map the post-pandemic resurgence of 13 infectious diseases. The spike size is determined by the fold change, or ratio, in the peak reported cases during a post-pandemic period (2022-onward) compared with the pre-pandemic maximum annual incidence between 2017 and 2019. The baseline year for pertussis for some countries may be set to an earlier date to capture the most recent outbreak before the pandemic.
The analysis includes chickenpox, cholera, dengue, measles, mycoplasma pneumoniae, parvovirus B19, invasive Group A Streptococcus, pertussis, influenza, RSV, wild poliovirus type 1, vaccine-derived poliovirus and tuberculosis. The global spike map illustrates only six diseases with most notable resurgences.
The analysis, as of June 1, relies heavily on data reported by countries or regions and may not be exhaustive. Data from some geographies may be more accurate due to superior surveillance and reporting systems. Some regions have also seen higher testing, which may have increased the disease incidence.
The year-to-date data has been included in the research since significantly higher cases are being recorded for certain diseases in 2024 than in any other year included in the study. In such instances, the fold change is calculated based on cases reported so far this year, with the assumption that these figures will rise as more data becomes available over time.
Boston Properties has signed a new tenant to 360 Park Ave. South, a handsome but mostly vacant building whose co-owner sold its stake back to the developer earlier this year for $1.
Ziff Davis agreed to relocate to corporate headquarters from 114 Fifth Ave. to the 20-story building at East 26th Street. The publishing house leased 23,000 square feet on the 17th floor, where the asking rent was $110 per square foot, according to broker CBRE.
The signing of Ziff Davis means the building is 25% leased, CBRE said. Investment firm Iconiq Capital agreed earlier this year to lease 70,000 square feet on the 18th and 19th floors at a starting rent of $103 per square foot, according to CoStar. Tenants are expected to move in this summer now that Boston Properties has wrapped up $100 million worth of renovations, with new lobbies, a roof deck, and a planned 7,000 square-foot restaurant from James Kent, a Michelin-starred chef who died suddenly this week at age 45.
Boston Properties expects 360 Park Ave. South’s fortunes will stabilize by late next year. But one investor, the Canada Pension Plan Investment Board, decided it couldn’t wait and early this year sold back its 29% stake for a dollar after putting $71 million into the building. By exiting, the pension fund avoided another $46 million in future funding obligations and saved $5 million in annual interest payments.
Those payments could rise because the building’s $220 million mortgage, carrying a 7.8% interest rate, comes due in December and may have to be refinanced at a higher rate.
CPPIB manages more than $400 billion in assets and has parted Manhattan office holdings recently at fire-sale prices. This year it sold its 45% stake in 10 E. 53rd St. to majority owner SL Green for $7 million and about $99 million in assumed debt. The pension fund invested $57 million in 2012 and a decade ago owned 1221 Sixth Ave., 600 Lexington Ave., and three others. The fund declined to comment.
Boston Properties acquired 360 Park Ave. South in 2021 for $300 million from Enterprise Asset Management, a real estate firm controlled by the late Meyer “Mike” Steinberg. The building’s anchor tenant, publisher Reed Elsevier, had moved out and Boston Properties, owner of the GM Building and other prime office towers, began renovation work on the 440,000 square-foot building.
Several handsome but older buildings on Park Avenue’s southern half are struggling to lure tenants when newer space is available.
Boston Properties officials say now that renovation work is done, interest in 360 Park Ave. South is picking up.
“Clients can actually see the very high quality of the finishes and the lobbies and the common areas and the amenities that we’ve put in place,” Hilary Spann, executive vice president for the New York region, said on a conference call last month. “We feel encouraged by the fact that the volume of interest in the building has stepped up meaningfully since we completed it and opened it.”
A megarich mystery buyer has scooped up two of the last remaining units in Vornado's luxury condo tower at 220 Central Park South, according to a deed that appeared in the city register Monday.
The classified purchaser, under a limited liability company named after the Midtown address, bought the pair of apartments — units 63 and 18A — for a combined $81.5 million, records show. How much each cost individually is not known.
Attorney Katherine Maksim of the Manhattan-based firm Chaves Perlowitz Luftig represented the undisclosed buyer. Maksim declined to comment on the sale.
And the seller — also shielded by a cloak of anonymity by using a trust similarly named after the address — first bought the unit on the 63rd floor straight from Vornado in 2020 for $53.5 million, according to city records. Attorney Ellyn Roth Mittman, who did not respond to a request for comment, represented the mystery buyer when they bought unit 63 in 2020, and again when they sold it four years later.
The 5,935-square-foot condo on the 63rd floor has four bedrooms, five bathrooms and two powder rooms as well as a roughly 100-square-foot balcony. The original price was $48.5 million, according to the building's offering plan. And unit 18A, which spans 1,233 square feet, has two bedrooms and two bathrooms, according to the plan, which did not list an offering price. Both units are 45 floors apart.
The 117-unit Central Park South condo, which began closings in 2018, is famously well loved by the plutocrat class, including hedge fund billionaire Kenneth Griffin, who bought a penthouse in the limestone building for $240 million in 2019, which at the time was believed to be the priciest-ever residential sale in America, Crain's has reported.
Investor Steven Roth, who runs Vornado, told investors during an earnings call last month that the building is "basically sold out."
Vornado declined to comment.
Leases
Investment firm takes space at 10 Bryant
Address: 452 Fifth Ave., Manhattan
Landlord: Property & Building Corp.
Tenant: Brighton Park Capital Management
Lease size: 16,428 square feet
Lease length: 10 years
Asset type: Office
Brokers: Newmark's Neil Goldmacher, Josh Friedman and Cooper Weisman represented the tenant. A JLL team led by Paul Glickman, Ben Bass, Kristen Morgan and Kate Roush represented the landlord.
Early childhood education center opening new Queens location
Address: 2-33 50th Ave., Queens
Landlord: Domain Cos., LMXD, The Vorea Group and Bridge Investment Group
Tenant: Bright Start Child Learning Center
Lease size: 4,545 square feet
Asset type: Retail
Brokers: Igloo's Adam Joly and Rachel Cohen represented the landlords.
Financings
Triple C Builders lands construction loan for 7-story Flatbush development
Address: 2700 Church Ave., Brooklyn
Owner: 2700 Church Realty LLC
Lender: S3 Capital Partners
Loan amount: $32 million
Asset type: Mixed-use
New York’s top court ruled in favor of the city in its quest to build affordable housing on the city-owned site of a Nolita sculpture garden, signaling that a years-long effort by community groups to block the project may be nearing its end.
In a 6-1 ruling on Tuesday, the state’s Court of Appeals rejected an argument by the nonprofit Elizabeth Street Garden that the city’s Department of Housing Preservation and Development had done an inadequate environmental review when it approved plans for a 7-story building on the Lower Manhattan site, set to contain 123 units of senior housing.
The decision narrows the potential ways that defenders of the garden, who have mounted a well-funded legal campaign to save it, can continue to block the project that has been planned since 2013. Pennrose is the lead developer of Haven Green, which would also contain 6,700 square feet of public open space.
Norman Siegel, an attorney for the nonprofit, told Crain’s that the garden backers “strongly disagree and are disappointed with the majority decision.”
“The challenge to preserve Elizabeth Street Garden is not over. It will continue,” Siegel said. He added that there are “other legal strategies that the legal team is giving serious consideration to pursue,” but said he was not yet prepared to discuss them.
The garden nonprofit also has an appeal pending in a separate case focused on the city’s attempt to evict the garden from the site, after a Manhattan judge ruled in the city’s favor last month.
The battle over the site has been held up as a prime example of New York City’s inability to respond quickly to its housing shortage. Supporters of the garden call it a precious oasis of green space that should be preserved, and have pointed to other nearby sites they see as more suitable for development.
But the city and pro-housing advocates say the Haven Green project would fill a crucial need in an area with a large senior population. The garden site has been leased since in 1991 by antiques dealer Allan Reiver and then by his son, Joseph, but the elder Reiver only opened the garden to the public a decade ago, as the city began planning the redevelopment.
In Tuesday’s ruling, the Court of Appeals dismissed the garden group’s argument that HPD had failed to consider environmental factors like climate change when it determined that the Haven Green project would have no significant impact on the surrounding area.
“Here, HPD identified appropriate areas of concern, took the necessary ‘hard look,’ and rationally determined that the project would not have a significant adverse impact on the environment,” the judges wrote.
Judge Jenny Rivera was the lone dissenter, authoring a 24-page dissenting opinion that concluded that HPD “failed to take the requisite hard look at the climate change impact of the project, including the reduction in open space, and did not provide a reasoned elaboration for its determination.”
The suit decided Tuesday was first filed in 2019 by the garden nonprofit, which is made up of local businesses and community organizations; and by Allan Reiver, who founded the garden after accessing the site through his next-door furniture store. Joseph Reiver became the face of the legal fight after Allan died in 2021.
In a social media post, HPD hailed the decision as “a win for affordable housing” and for “truly public green space.”
“Amidst the current housing crisis and climate crisis, we cannot afford to say no to new homes in well-resourced neighborhoods,” the agency wrote.
A judge in the eviction case gave the garden a stay of eviction until September, to give it time to relocate its heavy sculptures and benches. The judge also ordered the garden to repay $95,500 in back rent, plus interest.
The project’s other developers are RiseBoro Community Partnership and Habitat for Humanity, and the project will include a new headquarters for Habitat for Humanity on the ground floor. The developers expect to close on its financing this month, and could build the project by 2026 unless there are further delays, according to its website.
A pair of Brooklyn developers hopes to turn a pair of Bedford-Stuyvesant industrial sites into residential properties with affordable housing.
Developers Moshe Wasserman and David Litchtman plan to construct the buildings on adjacent lots at 862-868 Kent Ave. and 123-125 Taaffe Place, according to documents filed with the Department of City Planning. The Kent Avenue project would stand 8 stories and 93 feet tall with 65 residential units and 23 parking spots. It would span about 46,000 square feet and feature outdoor terraces on the seventh and eighth floors and a gym on the ground floor.
The building on Taaffe Place would stand 7 stories and 83 feet tall with 19 residential units across about 12,000 square feet. It would include seven parking spots and a private rooftop terrace for tenants.
The developers would build both projects under the city's mandatory inclusionary housing program, making 25% of the residential units affordable to households earning an average of 60% of the area median income, or about $84,000 for a family of three. This translates to roughly 17 affordable units in the Kent Avenue project and five in the Taaffe Place project.
A Brooklyn-based limited liability company linked to Wasserman bought 862-868 Kent Ave. in 2003 for $851,000, and one linked to Litchtman bought 123-125 Taaffe Place in 2012 for $496,000, property records show. Both sites are currently home to industrial buildings, and part of the property on Kent Avenue is used for chocolate processing, according to city records.
Wasserman did not respond to a request for comment by press time, and Litchtman could not be reached.
Union members at Amazon have voted to hook up with one of the largest labor groups, a partnership that could help pressure the e-commerce leader in staff contract negotiations.
About 98% of the Amazon Labor Union voted in favor of linking with the International Brotherhood of Teamsters, the groups said in a joint statement. They pledged to cooperate to help secure jobs and decent working conditions for Amazon workers.
The ALU won a landmark victory in 2022, organizing thousands of workers at an Amazon facility in Staten Island. But the union lost two subsequent elections and descended into conflict between leader Chris Smalls and other officials. In the meantime, attempts to bring Amazon to the bargaining table faltered.
Smalls said previously that he and 15 other ALU officials hammered out an agreement in Washington with Teamsters President Sean O’Brien and his colleagues. O’Brien’s group represents some 1.3 million people, according to their statement.
Amazon wasn’t immediately available for comment outside normal business hours.
Mayor Eric Adams on Monday announced his new pick to head the city office that works with nonprofit organizations, following the quiet departure of its former leader last year.
Johnny Celestin will be the new executive director of the mayor’s Office of Nonprofit Services, replacing Karen Ford, who served as the office’s inaugural leader for a year until she left for unclear reasons in December.
Celestin, who most recently served as deputy director for the mayor’s office of Minority- and Women-Owned Business Enterprises, takes the helm of an office created in 2022 aimed at bridging a gap between city agencies and the network of nonprofits that New York relies on for billions of dollars’ worth of contract work. Mayor Adams has had mixed success trying to tackle the city’s chronically late payments to those nonprofits, a major issue for the industry.
Celestin has previously worked at nonprofits like the Robin Hood Foundation and the Clinton Foundation and worked extensively in his native Haiti, including on efforts to rebuild following the nation’s 2010 earthquake, according to the mayor’s office and Celestin’s LinkedIn. He will report to Ana Almanzar, the deputy mayor for strategic initiatives.
The office of Nonprofit Services is intended to be “the primary hub for communicating with the sector,” charged with gathering their concerns and communicating policies to nonprofits, according to the city.
Ford, Celestin’s predecessor in the role, left the office as many nonprofits complained of worsening payment problems as the city shifted more of its contracts to the online platform PASSPort. Officials at the Mayor’s Office of Contract Services admitted this month that nonprofit vendors may face continued pain due to budget cuts that have hamstrung the office’s work.
At a City Council hearing this month, one homeless services provider said her organization, Breaking Ground, is owed $23 million by the Department of Homeless Services — including $12 million in repayments from invoices submitted to PASSPort.
Adams has touted some progress on the payment problem, including by clearing billions of dollars in backlogged payments and slashing some processing time for contracts funded by the City Council.
Adams, in a statement, said Celestin has “led by example” through decades of work in the nonprofit sector. His duties will include advancing the recommendations of the Joint Task Force to Get Nonprofits Paid on Time, which Adams led alongside Comptroller Brad Lander.
Celestin said he was “humbled” to take on the new role, and said he had been prepared well through his work boosting opportunities for MWBEs.
“Together, we can ensure the office fulfills its multifaceted mission head-on, including streamlining funding access for nonprofits to promoting equity and maximizing community impact,” Celestin said.
In addition to nonprofit work, Celestin is active in Haitian pro-democracy efforts and is a spokesman for the international group Defend Haiti’s Democracy.
Bus company Coach USA, owner of the Megabus brand and commuter bus lines New York and New Jersey, filed for bankruptcy, saying it was unable to recover from a decline in ridership brought on by the pandemic.
The company owes creditors between $100 and $500 million, according to its Chapter 11 petition filed Tuesday in Wilmington, Delaware. Chapter 11 of the U.S. Bankruptcy Code is designed to allow companies to keep operating while they shed debt and reorganize.
Coach USA operates a number of commuter services in the New York City area, including Rockland Coaches, Short Line, Suburban Transit and Community Coach.
Private equity firm Variant Equity Advisors purchased Coach USA from British bus company Stagecoach Group in April 2019, less than a year before Coach USA’s business was decimated by the pandemic. Commuter ridership declined 90% in 2020, according to court papers, and the company turned to Covid relief funding to help stay afloat.
Ridership has partially recovered, but last year was only about 45% of prepandemic levels. Meanwhile, the company was contending with higher expenses due to rising fuel, insurance and labor costs. Its management began to explore a possible sale late last year.
Across the U.S., the transportation industry has had to contend with low ridership levels on trains and buses as many Americans now work from home or only commute into the office a few times a week. In 2019, there were about 3,000 bus companies, according to Peter Pantuso, the chief executive officer of the American Bus Association. Since then, about half have closed, many of those remaining are operating at about 70% capacity, he said.
“We lost almost two full years of revenue over a three-year period,” Pantuso said in an interview. “You just don’t have enough bandwidth to make up that lost revenue period, because the bills didn’t go away.”
Just last year, popular New Jersey-based operator DeCamp Bus Lines ceased its New York City commuter service due to low ridership.
Many transit services rely heavily on fares, operators have had to seek out other sources of funding as that revenue dwindled. Unless the government steps in or new sources of money are found, many operators may be left with two choices: cut services or raise fares. Neither option will help to win back riders.
Coach USA said in a statement that the filing is intended to sell certain bus lines to an affiliate of Renco Group, as well as its Megabus intellectual property and retail operations. Avalon Transportation has also agreed to buy some Coach assets, the company said.
Both buyers have agreed to act as initial bidders at a court-supervised auction, the company said. The auction process and the initial bids must first be approved by the judge overseeing the bankruptcy.
To help pay for the restructuring case and to keep operating during bankruptcy, the company has arranged to borrow as much as $20 million.
Coach offers bus services in 27 locations in the U.S. and Canada and carries more than 38 million passengers every year, according to its website. Its Megabus service has carried more than 50 million people through more than 280 cities since it was started in 2006. The company employs about 2,700 people.
The owner of the fully occupied office tower at 731 Lexington Ave. extended its mortgage by another four months days before the $500 million loan came due last week.
By kicking the can, building owner Alexander’s Inc. evidently hopes it can lock in a lower interest rate before the extension granted by Deutsche Bank and Citigroup expires in October. The modification, which came at a cost of $10 million paid against the principal, may also signal how reluctant banks are to write large loans for even healthy office buildings such as the 57-story 731 Lexington. The 1.3 million square-foot tower is 100% occupied, according to bond-rating firm KBRA, and last month anchor tenant Bloomberg LP agreed to retain all its 900,000 square feet of space through 2040.
“The market is really tough,” said Piper Sandler analyst Alexander Goldfarb. “Shopping centers can get loans; office buildings are a much tougher proposition.”
Alexander’s, which is managed and one-third owned by Vornado Realty Trust, expects to complete the refinancing by Oct. 11, according to a regulatory filing last week. 731 Lexington’s floating-rate mortgage has jumped to 6.2% from 1.4% over the last two years, tripling the landlord’s quarterly interest and debt expense to $16 million. A spokesman didn’t respond to a request for comment.
In an indication of the refinancing challenges facing even the best buildings, about two weeks after Bloomberg said it would extend its lease at 731 Lexington by 11 years, the mortgage was transferred to special servicing, which is where troubled loans get worked out. Alexander’s proposed a four-year extension in exchange for paying down $25 million of the mortgage, Morningstar Credit said, but the special servicer rejected that offer. In return for the four-month extension that lenders did agree to, Alexander’s agreed to pay down $10 million of the mortgage. Alexander’s holds $526 million in cash.
“The borrower did not have time to refinance by the June 2024 maturity given the uncertainty at the time of the Bloomberg lease and the capital markets environment for an office loan of this size,” Morningstar said last month.
The market environment has improved since then, however. Yields on the benchmark 10-year government bond dropped to 4.21% last week after better-than-expected inflation data sparked hopes once again that the Federal Reserve will cut interest rates sometime in the next several months.
“Number of rate cuts may be debatable,” Evercore ISI real estate analyst Steve Sakwa said in a note to clients today, “but [the] bond market is becoming our friend.”
Will masks, after all we’ve been through, be banned on the subway?
Gov. Kathy Hochul and Mayor Eric Adams are suddenly interested in the idea. Hochul, in particular, backed the concept of a ban after she said “a group donning masks took over a subway car, scaring riders and chanting things about Hitler and wiping out Jews.” What’s less clear is what incident she was actually referencing.
It’s plausible, in fact, she was conflating two separate incidents.
Hundreds of people leaving a Union Square pro-Palestinian rally last week headed into a subway station to get on downtown-bound trains. On one train, a man who was not wearing a mask led a small group in chanting “Raise your hands if you’re a Zionist” to other passengers, followed by, “This is your chance to get out.”
In another instance, video circulating on social media showed a confrontation where a man in Union Square — who was also unmasked — shouted, “I wish Hitler was still here. He would’ve wiped all you out.”
But Hochul may have been reacting to a greater phenomenon: the protesters who increasingly wear masks in public. Begun as a Covid precaution, the practice is now common to avoid scrutiny from police and online harassment — or even the wrath of future employers. Doxxing is increasingly common, and pro-Palestinian protesters fear they will be put on blacklists for appearing in public in support of their cause. Hence, the masks.
New York passed a ban on face masks in public in the 19th century. The law was suspended in 2020 during the pandemic, and masks were mandated on the subway until September 2022. And before that, during the pandemic’s first year, face masks were required when heading outdoors.
Both Hochul and Adams would see an anti-mask measure as an anti-crime measure, a way to, theoretically, keep people from harassing others with a degree of impunity. But to restore that pre-2020 status quo, the state Legislature would need to change the law. This isn’t likely to happen anytime soon: lawmakers adjourned for the year and aren’t due back until January.
But even if Hochul had made this announcement earlier in the year, little could have been done. In a post-Covid world, mask bans don’t make sense and would be largely unenforceable. Hochul said that those wearing masks for health or religious reasons would be exempt — fair enough, but how would a police officer determine when a mask is worn for a legitimate purpose? How to know what someone’s thinking or what their intentions might be?
Fears of Covid infection remain and there are commuters who wear masks as a safety precaution in the subway. There are Muslims who cover their faces. too. What if a police officer harasses one of these people for no good reason? How much capricious enforcement would there be? Do police even want to do this?
Antisemitism is a grave challenge. There is no correlation, though, between hatred of Jews and mask-wearing, and no evidence such a restriction would decrease anti-semitic language or attacks. Hochul is grasping at straws. This isn’t shocking, perhaps, coming from a governor who has been so politically discombobulated that she throttled congestion pricing less than a month away from its planned start date.
Just as there was no forethought given to what revenue would replace the new tolls in Manhattan, it’s doubtful Hochul has thought much about the implementation of a mask ban. She’s reacting to the news cycle, or maybe a few loud voices in her ear. Unfortunately, that’s become all-too-common these days.
Ross Barkan is a journalist and author in New York City.
Two Madison Avenue office buildings just half a mile apart have recently come under new ownership, according to deeds that appeared in the city register Friday.
The property at 148 Madison Ave. was bought by the head of a home goods manufacturer under the limited liability company LMR Assets for $31.3 million, records show. Jack Saadeh, president of Manhattan-based Gourmet Home Products, snagged the 16-story building between East 31st and East 32nd streets from Steven Klein through the entity 148 Mad New Owner.
Klein told Crain's Monday that retaining control of the roughly 80,000-square-foot building — whose current tenants include the fast-food chain Five Guys, fast-casual restaurant Fields Good Chicken and a medical diagnostic imaging center — no longer made sense financially given its vacancy rate.
Come December, six-and-a-half floors out of the 16 will be empty, up from the four that currently are, he said. One tenant, CitizenM, a Netherlands-based global hotel chain, which takes up two floors of the Murray Hill building, is not renewing its lease.
"The loan was coming due at the end of the year, and I just didn't see it as a good use of capital to try to rent and refinance it," Klein said.
Klein picked up 148 Madison Ave., along with 152 Madison Ave., in 2001 for roughly what he sold it for. He offloaded the latter for $29 million in 2006, records show.
Saadeh of Gourmet Home Products, who took on a $19 million loan from Interaudi Bank to finance the purchase, did not respond to a request for comment, and it's unclear what his plans are for the space.
As for the second building, just south at 89 Madison Ave. in NoMad — also known as 95 Madison Ave. — its new owner, Flushing-based Sunlight Development, is eyeing a residential conversion of the 16-story landmarked property.
Long owned by the Sklar family, the property filed for Chapter 11 bankruptcy protection in 2021 under the entity Ninety-Five Madison Co., according to court records and a report in PincusCo.
A judge finalized the sale earlier this month, and it was acquired by Lin Zhong Zhuo of Sunlight for $65 million, according to the deed. Michael Sklar was the signatory for the seller.
The previous owner had been mulling a transformation of 89/95 Madison Ave. for a while, Crain's reported last year. Mayor Eric Adams held a press conference at the building, between East 28th and East 29th streets, last summer, where he pitched a rezoning spanning 40 blocks of the Garment District, NoMad and Chelsea in an effort to boost the city's housing supply by converting largely vacant offices into apartments.
"We are throwing open the door for more housing," Adams said at the time.
On June 13 Sunlight filed permits with the Department of Buildings to initiate the conversion, but the plans have yet to be approved, records show.
Neither attorneys for the Sklar family nor for Sunlight Development responded to a request for comment.
Leases
Investment firm subleases space at SL Green building
Address: 450 Park Ave., Manhattan
Landlord: SL Green
Subtenant: Dubin & Co.
Lease size: 10,777 square feet
Asset type: Office
Brokers: CBRE's Ben Friedland and Taylor Scheinman represented the subtenant.
Sales
Flushing-based developer buys Manhattan office building out of bankruptcy
Address: 89 Madison Ave., Manhattan
Seller: The Sklar family
Buyer: Sunlight Development
Sale price: $65 million
Asset type: Office
Gourmet Home Products scoops up Madison Avenue office building
Address: 148 Madison Ave., Manhattan
Seller: Steven Klein
Buyer: Jack Saadeh
Sale price: Approx. $31.3 millon
Asset type: Office
Financings
Florida firm finances acquisition of Upper East Side luxury retail space
Address: 680 Madison Ave., Manhattan
Owner: TZ Capital
Lender: Goldman Sachs
Loan amount: $120 million
Asset type: Retail
Brokers: A JLL team led by Christopher Peck and Aaron Niedermayer represented the owner.
The city’s Buildings Department has ordered a halt to construction work at a Midtown hotel owned by a woman who donated to Mayor Eric Adams, after a news report revealed that the project had been allowed to proceed despite multiple problems.
A stop-work order for the hotel at 317-319 West 35th St. was issued Wednesday, after a “miscommunication” between different city agencies had allowed construction to continue even though the hotel was being built in violation of a city commitment to build housing at that site, DOB spokesman Andrew Rudansky said in a statement.
The city’s reversal follows a May report by The City that exposed how the hotel’s developer, Weihong Hu, had raised tens of thousands of dollars for Adams during his 2021 campaign and then benefited from millions of dollars in city contracts following his election. The article described how Hu, in 2021, began building a 25–story hotel on a Midtown block despite prior assurances from the city’s housing department that the site needed to include affordable housing.
After spotting the violation, the Buildings Department under Mayor Bill de Blasio issued a stop-work order in March 2021. But after Adams took office, Hu enlisted the Rev. Alfred Cockfield III — a friend of the mayor’s — to press for the order to be lifted, and she got her wish by November 2022 when construction was allowed to proceed, The City reported.
Now, DOB acknowledges that the 35th Street project did not receive all the approvals required for a project that involves demolishing residential units. DOB spokesman Rudansky said the department “was made aware of potential approval issues by our partners” at the Housing Preservation and Development Department, and conducted an audit in response.
“The owners and their applicant of record will be required to demonstrate full compliance with zoning prior to resuming work at the site,” Rudansky said. He added that city agencies are now “discussing ways to prevent this miscommunication from happening in the future,” potentially by creating one unified certification document from HPD.
Hu’s hotel project blindsided neighborhood leaders, including the West Side’s Community Board 4, which had fought to secure the commitment to include housing at the site, The City reported.
An attorney for Hu did not immediately respond to a request for comment.
Rudansky did not say whether the developer, who previously demolished a pair of tenement-style apartment buildings on the site, would now be required to include housing in her project. The new audit found that Hu had never gotten a certification from HPD that it would be impossible to rehabilitate existing apartments on the site through any government-funded program, and Hu must “demonstrate compliance” with that rule to resolve the objection, according to DOB.
Adams, responding to reporters’ questions at a press conference last week, said he “didn’t intercede at all” on the project.
“People call city government all the time to try to get through the bureaucracy,” he said. “Everyone has to follow the rules.”
Hu has benefited in other ways during the Adams administration, including by landing lucrative contracts to shelter migrants at other hotels she owns, The City reported.
Laurence "Larry" Gluck, the founder and longtime leader of major New York landlord Stellar Management, has passed away at age 71 after a battle with ALS.
Gluck died June 13, according to Stellar, which released a statement that praised him as "a visionary leader in the real estate industry." It stressed that Stellar will continue to be family-run, with Gluck's wife, Sandra, and his oldest daughter, Amanda, overseeing investments, management and operations at the company. Managing Partners Adam Roman, Matthew Lembo and Ryan Jackson will remain at the helm as well.
Gluck was born in 1953 and founded NoMad-based Stellar Management almost 40 years ago. He and developer Steve Witkoff, whom he worked with at the law firm Dreyer & Traub, partnered to start Stellar in 1985 and settled on its name by combining letters from both of their first names. The firm initially focused on purchasing and constructing apartment buildings in Washington Heights.
Witkoff left the company in 1997 to start his own firm, the Witkoff Group, while Gluck continued to lead Stellar. The firm would often buy properties in the rent-subsidized Mitchell-Lama program and deregulate them, which led to multiple controversies and clashes with tenants at complexes including Independence Plaza in Tribeca and, perhaps most famously, Riverton Houses in Harlem.
Stellar purchased Riverton for $135 million in 2005 with plans to convert more than half of the 1,230 apartments to market-rate units by 2011, but this effort ran into multiple problems amid the Great Recession. The company ultimately lost the building to foreclosure in 2010 after defaulting on its $225 million loan.
This did not spell the end for Stellar, however, with Gluck and the firm enjoying a bit of a comeback in the 2010s. He took on the troubled Tivoli Gardens residential project in Brooklyn with the support of the city, for instance, which provided Stellar with more than $40 million worth of support in exchange for a pledge to keep the development in the Mitchell-Lama program for 30 more years. The company also led a group that purchased a pair of adjacent SoHo properties in 2012 at 161 Sixth Ave. and 233 Spring St., which it developed into the office building now known as 1 SoHo Square.
But the company continued to spar in court with tenants in its residential buildings, with many in the later 2010s accusing Stellar of exaggerating the amount of work it did renovating apartments to justify taking them out of rent regulation.
Stellar's portfolio now spans more than 12,000 apartments in more than 100 buildings, along with more than 1 million square feet of retail space, more than 2 million square feet of office space and more than 1 million square feet of developments in its pipeline.
The federal government gave its final blessing for the now-stalled congestion pricing program, reiterating the economic significance of the program and all but eliminating any political cover from the Biden administration for Gov. Kathy Hochul’s last-minute postponement.
The Federal Highway Administration issued a report late Friday determining that the final toll structure for the MTA’s plan to charge most motorists $15 to enter the busiest part of Manhattan would not negatively impact the environment and would be a boon to the region’s economy.
“The Final [environmental assessment] and reevaluation found economic benefits from [congestion pricing] through travel-time savings and travel-time reliability improvements, as well as reduced vehicle operating costs,” federal transit officials wrote in a 14-page executive summary on the approval. The document adds that the tolls are “not anticipated to result in meaningful change in cost for most consumer goods.”
Findings in the Friday report run contrary to Hochul’s recent remarks in defense of the indefinite pause; she has argued that congestion pricing could stifle the region’s post-pandemic recovery and result in “everything from the cost of a piece of pizza is going to go up because there’ll be charges imposed that’ll be passed onto consumers.”
The report could bolster legal challenges against Hochul’s indefinite pause, and may embolden MTA board members who are now grappling with a multi-billion dollar hole in the authority’s capital plan to publicly challenge the governor’s reversal when they convene for a board meeting on June 26.
Among the federal government’s findings are that the congestion pricing program would result in a 17% drop in the number of vehicles traveling below 60th Street in Manhattan. The tolls would raise enough revenue for MTA officials to bond $15 billion to invest in improvements to the subway, buses and commuter rail.
The FHWA’s report also emphasized that with final MTA tweaks and investments in mitigations, “some of the adverse effects no longer occur and many are on the lower end” of those that were disclosed in the final environmental assessment of the tolling program. Congestion pricing ultimately “meets the purpose and need of reducing traffic congestion in the [central business district], while generating revenue for future transportation improvements,” the report states.
In a statement, MTA Deputy Chief of External Relations Juliette Michaelson said the authority is “pleased, and not surprised, the federal government has once again determined that congestion pricing will not adversely affect the environment, the economy, or environmental justice communities.” She added that the agency remains “ready and committed to work with our partners in government so New Yorkers can realize the benefits of the congestion relief.”
The FHWA’s report came just one day after the MTA and both the city and state transportation departments had requested that federal transit officials continue with its reevaluation of the final tolls, since congestion pricing is on a temporary pause and not an outright cancellation. John Lindsay, a spokesman for Hochul, said the report allows the governor to “keep all options available as discussions continue regarding next steps.”
Friday’s document clears the way for the MTA to move forward with what’s known as a “Value Pricing Pilot Program” agreement. Officials with the federal government, the MTA and city and state departments of transportation must all sign on to the agreement before flipping the switch on the tolls, but Hochul has hit the brakes on the process.
The governor has indicated that, for the time being, the state’s Transportation Commissioner, Marie Therese Dominguez, will not sign the agreement.
New York and the rest of the Northeast are about to get seared by a record-breaking heat wave that will boost electricity demand, raise health risks and potentially be a headache for commuters.
Central Park is set to reach 98F by Friday, the National Weather Service said. The worst of the heat will spread through the Midwest, upstate New York and New England this week before descending on New York City and Washington.
Mayor Eric Adams said he anticipates the National Weather Service to issue a heat advisory to the New York City area for Thursday through Friday. The mercury is expected to rise past 90F beginning Tuesday.
“We want to be clear, this is extremely hot for June, and New Yorkers should not underestimate the heat,” said Adams during a Monday morning news conference. “With climate change leading to more frequent and intense heat, our summers are different than they were before, and so we should expect and be prepared for the hot weather that is coming.”
While summer doesn’t officially start until Thursday, across the U.S. more than 120 daily high-temperature records may be broken or tied, with the majority of them in the Midwest, Mid-Atlantic and New England, the U.S. Weather Prediction Center said. The humidity will make conditions feel hotter, driving up power demand as people crank up air conditioners.
“Today is the day when the humidity starts to increase. It is still bearable today, but the heat really comes in tomorrow,” said Scott Kaplan, a meteorologist with Hometown Forecast Services, which provides forecasts for Bloomberg Radio.
The city will open several cooling centers in the five boroughs as of Tuesday at libraries, senior centers and other sites for New Yorkers, and their pets, to access. FDNY firehouses will make spray caps for fire hydrants available to anyone 18 or older with an ID. The Parks Department will also operate water features and drinking fountains in parks across the city. And teams of homeless outreach workers are patrolling the city's streets to offer services to unhoused New Yorkers.
“Extreme heat is the most dangerous weather phenomenon we have in New York City,” said New York City Emergency Management Commissioner Zach Iscol. “In the forthcoming days, we're looking at heat indexes that could reach close to 100 degrees in the region — these numbers are dangerously high.”
An average of 350 New Yorkers die each year as a result of extreme heat, said Iscol.
Over the weekend, Gov. Kathy Hochul warned residents the looming heat wave was “no joke” in a post on X. It can also warp railroad tracks and slow down commutes in the large eastern cities that rely on trains to move people.
New York officials say those who must work outdoors should drink water every 15 minutes, take frequent breaks in shaded or air-conditioned areas and wear lightweight and light-colored clothing.
The most intense heat will likely be across New England, said Bob Oravec, a senior branch forecaster at the Weather Prediction Center. The high in Concord, New Hampshire, may reach 101F on Thursday. Scorching weather will also spread into Canada, with Montreal hitting 93F and Toronto 91F, according to Environment and Climate Change Canada.
A large high-pressure system is building over the eastern U.S. and that will trap the heat over the area, allowing it to intensify, Oravec said. While the sizzling conditions will ease over New England later in the week, New York and Washington will likely stay hot through the weekend.
“It is going to be the story of the week,” Oravec said. The heat is “pretty expansive, it gets anchored and doesn’t move for the entire week.
Of all the hot IPOs over the past year — AI firms and biotech startups and the like — none has popped on Wall Street quite like Cava Group.
The restaurant chain — the Mediterranean Chipotle, as its financial backers like to call it — has soared more than 300% since its initial public offering in June 2023, giving it a market valuation of over $10 billion. That equates to $33 million for each of its 323 restaurants, a staggering sum even for a chain that’s rapidly expanding. By comparison, investors valued Chipotle Mexican Grill, the benchmark in the fast-casual restaurant industry, at just about $3 million per restaurant when it completed the one-year mark in public markets. (On a price-to-earnings ratio, Cava is expensive, too, clocking in at 185.)
All of this highlights how the global IPO market is cracking back open after a couple of sluggish years. Bring the right kinds of new stocks to market, like a trendy fast-casual chain, and investors will bid them up.
But the rally has been so extreme that it’s starting to cause angst among some Cava bulls. In the span of just four days, two of the 15 Wall Street analysts who cover the company — JPMorgan Chase’s John Ivankoe and Piper Sandler’s Brian Mullan — cut the stock to neutral from overweight.
The per-restaurant valuation “is unprecedented” in the industry, Ivankoe wrote in his June 3 report. Each location, he noted, currently pulls in less than $3 million a year on average in revenue. He told clients he’d rather buy Chipotle stock at this point, underscoring a broader trend: two-thirds of analysts have buy ratings on Chipotle versus just over half now for Cava.
Some corporate insiders have also recently sold chunks of their Cava stock. For the most part, though, investors remain willing to accept such lofty valuations. Even after a sluggish start to June, Cava is up more than 100% this year. Fast casual is popular with the Wall Street set now, and Cava, as they see it, is the up-and-comer that will trace Chipotle’s arc.
“Investors are willing to pay a premium for these growth-oriented concepts,” said Jim Salera, an analyst who covers restaurant stocks at Stephens. Salera, who doesn’t have a rating on Cava, says they’ll “pay that premium because there’s only a handful of restaurants that are providing growth.”
For Lauren Balik, the CEO and founder of research firm Upright Analytics, the whole Cava-is-the-next Chipotle narrative is complicated. Yes, she says, Cava could expand rapidly like Chipotle did — the company plans to have 1,000 restaurants in operation within a decade — and business could boom, but that growth brings its own risks. Chipotle struggled to standardize hygienic conditions as it quickly added restaurants, triggering a series of food-poisoning incidents that made national news and cratered the stock in 2015. It took Chipotle a while to fix its procedures, and the stock only began to rebound two years later.
Cava has managed to avoid such problems, opening more than 50 locations in the past year without any notable quality issues. Still, Balik says, it’s a good reminder that rapid growth can cause operational hiccups. She’s betting against the stock, having put on a short trade in January.
“Everyone makes the comparison to Chipotle. If you make that comparison, you have to compare Cava to early Chipotle, which was a similar story,” Balik says. “It opened a lot of new stores, it grew quickly, but the operations and execution in late 2015 didn’t work that well.”
The Real Estate Board of New York would be wise to engage with housing advocates to find a compromise on broker fees.
REBNY mobilized an angry rally of real estate brokers last week to oppose a City Council bill, put forth by Councilman Chi Ossé, that would require whoever hires a broker to pay their fee, effectively shifting broker fees from tenants to landlords. The brokers say the bill would cut their incomes and raise rents because landlords would likely pass the costs onto consumers. Supporters say that the fees, which are unique to New York and Boston, are untenable at a time when rents are already sky-high. They also dispute the assertion that the shift would cause rent to jump further, noting that it is dictated by market forces. Plus, any potential increases would be a non-issue for the half of city apartments that are rent-stabilized.
However, this hard-line opposition is not a productive path forward. A more nuanced approach could benefit the real estate industry in the long term.
A typical broker fee is 15% of a tenant’s annual rent. For the average Manhattan apartment, where median rent recently reached $4,500, that would amount to about $8,100, and that’s on top of any first month, last month rent and security fees collected by the landlord.
Ossé’s bill has merit. Broker fees are ripe for abuse. A broker is essentially selling access to a tight rental market. There is every incentive for those who can pay more to offer the broker a higher fee. Better-off people can purchase access.
The city is in the midst of a housing crisis where even workers in the technology sector struggle to find affordable apartments. Having to pay thousands of dollars for a simple transaction is another deterrent for young professionals moving to the city. The lack of housing supply drives workers to the suburbs and deep outer boroughs, forcing them to deal with an unreasonable commute and contributing to persistently depressed return-to-office numbers.
What’s more, the writing is on the wall for the brokering profession. StreetEasy and Zillow have made it easier for tenants to access listings. The broker business is only the most recent example of an industry being disrupted by technology.
Resistance to change is doomed. Instead, brokers and REBNY would be wise to suggest some middle-ground measures. This could include capping fees at a lower percentage so that tenants are not faced with five-figure deposits to move apartments. Increasing transparency around tenants’ rights would also ease the tension around this opaque and unregulated market. Another option would be to have landlords and tenants split the broker fee, similar to how the transaction is structured when buying a house.
The bill is widely popular and is just one vote shy in City Council of the supermajority needed to override a potential mayoral veto. If REBNY continues with its all-or-nothing approach, it may end up with nothing.
CULTURALLY COMPETENT CARE CONTRACT: The city’s Department for the Aging awarded a $8.3 million contract to Queens Village-based social service agency Services Now for Adult Persons. The group will be tasked with assessing the needs of older adults in a culturally competent way and coordinating resources, according to a notice in the City Record.
HOMELESS NUMBERS: There were about 4,140 individuals experiencing unsheltered homelessness in the city in January, according to to a new survey released by the Department of Social Services and Homeless Services. The number is the second-highest on record, since data collection started in 2005.
ROBOTIC SURGERIES: Long Island Community Hospital in Patchogue is set to announce its 1,000th robotic surgery today as it inches closer to a full asset merger with parent company NYU Langone. NYU entered a partnership with Long Island Community Hospital in 2021, and has since invested at least $100 million in improving infrastructure and quality metrics. The hospital is planning to complete its merger with NYU Langone by spring of next year.
A much-anticipated report on New York’s Covid emergency response condemned former Gov. Andrew Cuomo for stripping power from health officials at the height of the Covid-19 pandemic.
Cuomo’s decision to delegate all decision-making to his executive chamber during the early days of the crisis was a “significant and unnecessary mistake,” according to the report commissioned by Gov. Kathy Hochul and released on Friday. The 262-page report by the Alexandria, Virginia-based consulting firm the Olson Group cost the state $4.3 million.
Although the report criticized Cuomo’s “top-down” and “centralized” management approach that favored executive authority over Health Department protocols, it made few critiques of his handling of nursing home deaths, which were largely underreported by the administration. The state came up “well short in terms of both perception and performance” when it came to nursing home deaths, the report said. But the consultants added the caveat that New York’s outcomes were largely consistent with other states.
But the report, which has experienced significant delays, delivers few actionable recommendations about how to improve New York’s pandemic preparedness protocols, government watchdog groups say. Some go as far as to say that the findings are flawed, providing the public with information that is inaccurate at best and deceptive at worst.
Bill Hammond, senior health policy fellow at the Empire Center for Public Policy, pointed to the lack of criticism about nursing home deaths. The report cites a study that ranks New York in the bottom third of states on nursing home fatalities. But that study, Hammond said, fails to include data from March and April when the virus was spreading through nursing homes across the state, potentially skewing the data.
“They seem to buy into the idea that the state was doing the best it could,” Hammond said of the consultants. “That reflects a real cluelessness on their part about what happened.”
Rich Azzopardi, a spokesman for Cuomo, said that the former governor brought the “unified force of government” to the Covid crisis to create field hospitals, organize the state’s 261 hospitals and collect protective equipment. Cuomo’s daily press briefings were lauded for bringing facts to the table amid a “chaotic national response,” he added.
“We all lived through this,” Azzopardi said. “No rational person can believe that a coordinated centralized response is inferior to having decisions made by a gaggle of faceless bureaucrats.”
Advocates for government transparency disagree.
“Fundamentally this whole report is about Cuomo’s ego and need to dominate,” said John Kaehny, executive director of the think tank Reinvent Albany. New York has a lack of safeguards in place to prevent political leaders from consolidating power in a crisis, he said, the consequences of which were evident in Cuomo’s decisions to strip authority from health officials and block data from being released in public forums. Kaehny said the report failed to outline policies or tactics to prevent that consolidation of power.
The report follows growing momentum around state legislation that would have authorized legislators to subpoena witnesses to testify about New York’s pandemic response. The legislation did not pass before the end of session earlier this month; but it is still necessary to get a more accurate picture of the state’s missteps and improve pandemic preparedness, Kaehny said.
The consultants acknowledged that “a number of key officials were unwilling” to be interviewed for this report, which may have limited their findings. Hammond said the report’s failure to name those officials is a missed opportunity to hold the government accountable.
“If the health commissioner is not talking, I think the public is entitled to know that,” Hammond said.
A Williamsburg nonprofit that serves people with disabilities is offloading all of its adult residential treatment facilities by early September.
Little Flower Children and Family Services, which provides foster care and behavioral health services to adults and youth with disabilities, is planning to lay off 98 workers and close nine facilities in Long Island and Queens, according to a notice filed to the state Department of Labor last week.
Eight of the residential treatment facilities slated for closure will be transferred to another nonprofit, said Katherine Heaviside, a spokeswoman for Little Flower. The four residents who live in the ninth facility will be transferred to other residential facilities.
The bulk of workers being laid off are direct care workers, Heaviside said. The number of workers it employs is no longer financially sustainable, she added – at one of its facilities, it employs 28 direct support workers to care for four adults.
Faced with financial challenges, Little Flower has decided to shift its focus entirely to youth services and an expansion of mental health care, Heaviside said. The nonprofit expects all of the direct care workers being laid off to be offered a job by new management.
But Little Flower faces another financial vulnerability. It’s been hit with dozens of child sex abuse lawsuits under the Child Victims Act, a law that extended the statute of limitations for individuals to file civil abuse cases.
Heaviside said the suits have nothing to do with Little Flower’s decision to scale back its residential locations.
The nonprofit employed 605 workers as of June 2022, and brought in $53 million in revenue during that time period, its most recent tax documents show.
Mount Sinai’s decisions to downsize, close and move once-profitable services at Beth Israel are to blame for the hospital’s financial ruin and pending closure, according to a new report.
The report, released by the Save Beth Israel and New York Eye & Ear Campaign, a coalition of advocates and health care professionals, accuses the hospital system of “actively undermining and dismantling” Beth Israel after acquiring the hospital from Continuum Health in 2013. The report challenges the notion that Mount Sinai must close Beth Israel due to insurmountable financial losses.
The steepest year-to-year decline in patient revenue, $142 million, took place between 2016 and 2017 when the hospital made changes to typically profitable services. For example, in 2016, the hospital decertified 26 rehabilitation beds, and in 2017 it decertified 25 pediatric beds, 31 neonatal beds and 42 maternity beds, while closing its cardiac surgery unit, according to the analysis. The report is based on the hospital’s 990 federal tax filings and audited financial statements.
The health system vehemently disputed the report’s findings. Loren Riegelhaupt, a spokesman for Mount Sinai, called the accusations “patently false” and part of a “larger conspiracy theory.”
Riegelhaupt said Mount Sinai’s decision-making has been driven by low patient volumes and the “inherent risk” to patient safety.
“We started moving those services in 2016 to other Mount Sinai hospitals that specialize in that type of care to ensure the best quality care for our patients, which was vetted and approved by the [state Department of Health] at the time,” he said.
Mount Sinai hopes to close Beth Israel on July 12, but state officials have not approved the closure, and the coalition that published the financial analysis is suing, either of which may compromise the timeline.
The coalition called on the Department of Health to “recognize that the current financial and operational challenges at [Beth Israel] result from deliberate management and decision-making by [Mount Sinai] leaders.”
The Mount Sinai system was investigated by the state earlier this year for prematurely ending services, and said Beth Israel has been understaffed as clinicians leave the hospital for new opportunities.
Mount Sinai Health System CEO Dr. Brendan Carr said at a Crain’s event on Thursday that he “loses sleep” thinking about how long the hospital can continue to operate with a reduced staff.
The health system is currently awaiting a response from the state on its revised closure plan. The lawsuit, which resulted in a cease and desist order from a Manhattan judge, is expected to play out through the summer.
Mayor Eric Adams’ fast-moving push to amend the City Charter has sparked accusations of political opportunism, but the city’s most prominent fiscal watchdogs see it as a chance to tighten the rules that govern how New York spends money.
The city comptroller, Citizens Budget Commission and the Independent Budget Office all testified at Thursday’s hearing by the mayor’s Charter Revision Commission, which was devoted to the topic of “fiscal responsibility.” It is one of several overarching topics that Adams has asked the 13-member commission to focus on, along with improving public input on legislation that affects public safety.
The watchdogs’ ideas could significantly change how the city studies the cost of new laws and makes payments to nonprofit vendors — although it remains unclear if the charter commission, made up of loyalists to the mayor, will take up the suggestions.
The panel that Adams convened last month is seen by many as an attempt to block a separate effort by the City Council to increase its oversight powers of the mayor’s appointments — although City Hall has denied any such connection. By law, the two measures could not appear on the November ballot together. The mayor stacked the commission with his own friends and allies, and even the “fiscal responsibility” focus seems to mirror Adams’ objections to last year’s Council bill that expanded costly housing vouchers.
But even figures like Comptroller Brad Lander, an Adams adversary who has expressed doubts about the commission’s true purpose, say it presents a chance to improve the city’s hazy practices around budgeting and contracting. The commission must finalize a set of recommendations by Aug. 5 for them to appear on the November ballot and be approved or rejected by voters.
A few watchdogs presented overlapping ideas during Thursday’s public hearing at New York Law School. Both the Independent Budget Office and the Citizens Budget Commission argued for strengthening fiscal impact statements — analyses of how every new law will affect the city’s bottom-line, which the Council is already required to prepare before voting on any bill.
In practice, fiscal impact statements are often scarcely considered by lawmakers. The CBC pointed to the glaring example of last year’s Council bill that expanded low-income housing vouchers: Although the council’s own fiscal analysis showed the expansion would cost a staggering $10 billion over five years, the council passed the bill anyway just a day after publishing that finding, and issued a press release pointing to a different analysis by a nonprofit group claiming the bill would actually save the city $700 million. (The council is now locked in a legal battle with the Adams administration over his refusal to implement the law.)
“The charter should require impact statements be published earlier, so the council and the public have time to consider them,” CBC President Andrew Rein told the charter commission on Thursday. Rein suggested the charter could also require each fiscal impact statement to identify how a bill would be paid for, and potentially allow the city to not implement a policy if it has “major budget implications.”
Meanwhile, both IBO and Comptroller Lander honed in on the city’s chronically late payments to the nonprofits it contracts with for services like homeless shelters and childcare.
Small changes to the charter could let the city mandate that agencies “pay at least a substantial portion of any duly submitted invoice from a services contractor in good standing,” said Louisa Chafee, director of the IBO, at Thursday’s hearing.
Lander, for his part, said the charter could be amended to add timeframes for each stage of the procurement and contracting process, to hold both the city and vendors accountable.
And all the watchdogs agreed that something should be done to address the city’s “rainy day” fund, a reserve meant to guard against future emergencies that currently contains $2 billion. Both Lander and the CBC said the city should be required to put a certain amount of money into the fund every year, and also add some guardrails to stop mayors from dipping into the funds.
“At minimum, the charter should require mandatory deposits, withdrawals limited to a recession or severe emergency, and a target size,” said Rein, of the CBC.
Each of the fiscal watchdogs also presented ideas of their own: IBO proposed amending the charter to put a time limit on emergency contracts, which tend to be pricier than regularly-bid deals and have cost the city billions of dollars during the migrant crisis. When emergency contracts come up for renewal, they could face a new review by the mayor and comptroller to prevent them from being constantly extended, IBO said.
And Comptroller Lander suggested making city agencies more responsible for their spending by setting new multi-year savings targets for each department, and making agencies responsible for judgments and claims against them — potentially incentivizing agencies like the NYPD to refrain from misconduct that has resulted in frequent and costly payouts.
The mayor’s Charter Revision Commission is chaired by Carlo Scissura, head of the New York Building Congress and a lobbyist whom the mayor once considered appointing to lead the city’s Economic Development Corp. Other members include Ruben Diaz Jr., a lobbyist and former Bronx borough president; Jackie Rowe-Adams, an anti-gun violence advocate and vocal supporter of the mayor; and Max Rose, the former Staten Island Congressman-turned lobbyist.
The panel will host a second round of public meetings starting June 24.
Here are the subway disruptions, road closures and other commuting changes you should be aware of as you get around the city this week.
Subway
— No 2 trains between Chambers Street in Manhattan and Atlantic Avenue-Barclays Center in Brooklyn between Monday, June 17 beginning at 11:30 p.m. to Wednesday, June 19 at 5 a.m.
— No 4 train service in Brooklyn between Monday, June 17 beginning at 11:30 p.m. through Wednesday, June 19 at 5 a.m. Take the 2 or 3 instead.
— G trains won’t run between Bedford-Noststrand avenues in Brooklyn and Court Square between Monday, June 17 beginning at 9:45 p.m. through Friday, June 21 at 5 a.m.
— In Manhattan, no L trains between 14th Street-Union Square and Eighth Avenue between June 17 beginning at 11:45 p.m. through Friday, June 21 at 5 a.m.
— On Wednesday, June 19, 2 trains run every 16 minutes between Gun Hill Road and Wakefield-241 Street in the Bronx from 10 a.m. to 2 p.m.
— 2 trains will similarly run every 16 minutes between East 180 Street and Wakefield-241 Street in the Bronx on Thursday, June 20 beginning at 10:30 a.m. through Friday, June 21 at 2:30 p.m.
— In Brooklyn, no B trains between Kings Highway and Brighton Beach on Thursday, June 20 from 9:45 a.m. to 3 p.m. Take the Q as an alternative.
— No Q trains between Bright Beach and Coney Island-Stillwell Avenue on June 20 between 9:45 a.m. and 3 p.m.
Commuter rail
No major disruptions planned for commuter rail.
Roads and bridges
The following streets will be closed for the Museum Mile Festival on Tuesday, June 18th:
5th Avenue between 79th Street and 109th Street
Read recent transportation stories:
JPMorgan Chase's asset-management arm raised more than $500 million for a biotech venture-capital fund that will bet on the hottest corner of health care: weight-loss drugs.
The fund closed this month, and “the top three choices are obesity, obesity and obesity,” Steve Squinto, the chief investment officer of the unit’s life-sciences team, said in an interview.
GLP-1s, as the weight-loss drugs are known, “are all the rage,” and the field is “wide open,” Squinto said. “This has the opportunity to be a pivotal moment in the pharmaceutical industry.”
The new class of weight-loss drugs has exploded in popularity in recent months, with ballooning demand causing shortages. Novo Nordisk and Eli Lilly currently command the field, with list prices of $1,000 a month or more for a single user. As JPMorgan sees it, that presents an opening.
“It’s very unlikely that the future of obesity treatment will be dominated by a stable duopoly,” Gaurav Gupta, the fund’s managing partner, said in the interview. “There will be significant winners.”
JPMorgan hired Squinto and Gupta in late 2022 as its $3.6 trillion asset-management business launched the life-sciences team. The group has seven employees and sits within the bank’s private-capital business, which is part of a larger alternatives arm.
The first offering, 270 Life Sciences Private Capital Fund I, has made five investments so far, Squinto said, though just one of them has been announced publicly: leading a $100 million Series A financing round for La Jolla, California-based startup Enlaza Therapeutics. In addition to weight-loss therapies, the fund will make investments in areas such as oncology and immunology.
A onetime Brooklyn appliance magnate, who pivoted from a career selling ovens and refrigerators to one in real estate development, is looking to erect a 4-story high school in Coney Island, according to documents that appeared in the city register this week.
Under a limited liability company named after the address, Elie Fouerti — whose younger brother, Albert, started their now-defunct Bensonhurst-based company, Appliances Connection, in the early 1990s — is seeking permission from the city to build the classrooms and adjoining community facility at 773 Neptune Ave., records show.
The irregularly shaped development site between West Sixth Street and Shell Road spans two lots — 1 and 50 — the latter of which is vacant and is where the school would go; construction of an 8-story residential building has started on the former. On the rest of the block, there's an existing 12-story residential building, documents show. An entity controlled by Fouerti owns both lots; he paid $26.2 million for No. 1 in 2021, city records show, but it's unclear how much he paid for lot 50 in 2022.
The planned 4-story, 30,950-square-foot high school — which likely would be a charter facility — would also contain community space and a school gymnasium. Permits filed with the city several years ago, and as recently as February, indicate plans to build a 1-story residential development and a house of worship on the Neptune Avenue lot. It's unclear what caused Fouerti to go the schoolhouse route instead. He did not respond to a request for comment, and a representative for Manhattan-based law firm Cozen O'Connor, which is listed on the application, declined to provide more details about Fouerti's updated plans.
The representative from Cozen O'Connor, who would not provide a name, declined to comment on construction costs for the project but said pending approval from the city this year, completion is slated for 2026.
When Albert Fouerti started Appliances Connection in 1992, he originally sold computers, then switched to digital cameras and flat-screen televisions — a venture his brother joined — before the two of them got into the lucrative oven and fridge business in 2011. By 2016 sales had topped $155 million, according to a 2017 profile of the pair written by Crain's Matthew Flamm, who died from brain cancer at the start of this year.
A Missouri-based retail company then called Goedeker's bought Appliances Connection in 2020, with the brothers still holding leadership positions. A year later, however, Goedeker's changed the name to Polished, and both Fouertis resigned from their positions in 2022, The Real Deal reported at the time.
It's unclear if Albert is working with his brother on the Coney Island development, although the two have teamed up on certain real estate projects before, including the purchase of a shopping center in Florida, according to The Real Deal.
Elie Fouerti is also working with Coney Island-based firm Rybak Development on the Neptune Avenue project. Rybak did not respond to a request for comment.
Starwood Capital Group is nearing a deal to sell the 1 Hotel Central Park to Host Hotels & Resorts as high room rates drive investor interest in Manhattan’s lodging market.
The deal isn’t final and could still fall through, said people familiar with the matter who asked not to be identified discussing private details. Starwood sought more than $1 million per room for the property in a 2016 effort that did not lead to a sale. The hotel has about 230 rooms.
A representative for Starwood didn’t immediately respond to a request for comment. A Host representative declined to comment.
Starwood opened the property in 2015 as part of billionaire Barry Sternlicht’s 1 Hotel brand, with an ivy-covered facade and a restaurant that serves seasonal cuisine from chef Jonathan Waxman.
Manhattan hospitality owners are benefiting from greater pricing power, as a recent crackdown on short-term rental listings and a program to house migrants in local hotels have combined to constrain lodging supply. New city restrictions are likely to limit further hotel development and expansion.
Host Chief Executive Jim Risoleo has been on a buying spree. The company agreed in May to purchase the Turtle Bay Resort in Hawaii from Blackstone for about $680 million, net of key money. It struck a deal to buy the 1 Hotel Nashville and an adjacent Embassy Suites from a group led by Starwood in April.
New York City is a step closer to implementing the desperately awaited, middlingly received tax break for affordable housing developments that was approved in this year’s state budget to replace the bygone 421-a program.
Mayor Eric Adams’ administration on Friday announced that developers can register online to receive benefits through the new 485-x tax break, and submit letters of intent to qualify for the five-year extension of the old 421-a benefit that was also part of the state budget. Both the 485-x and 421-a portals are now live on the city’s Housing Preservation and Development Department website.
All projects participating in 485-x must fill out the registration form within six months of starting construction if the start date was on or before April 20, 2024. Projects that started construction between June 15, 2022 and April 20, 2024 must register by mid-November. As for the 421-a extension, developers must submit letters of intent by Sept. 12.
Actual applications for the new 485-x tax break are not yet available, but the city will launch them by the end of the year and make the first approvals in 2025, City Hall said in a press release.
As construction lagged following the expiration of 421-a two years ago, the Adams administration pushed hard in Albany this year to secure the new tax breaks — along with another incentive for office-to-residential conversions that also started implementation this month.
Details about the tax breaks are on the HPD website, largely spelling out the rules already set by state lawmakers earlier this year. The 485-x program grants tax exemptions of up to 40 years for projects that include affordable units, with the exact benefit depending on the number of affordable units and the location of the building. The program also sets wage rates that were crucial in securing union support, including a $40 per-hour minimum for construction workers on large projects of 100 units or more.
The 421-a extension, meanwhile, allows projects to qualify for the old tax break if they are completed before June 15, 2031 — five years past the previous 2026 deadline. The state budget also tweaked 421-a to eliminate an affordability scheme unpopular among housing advocates that granted the benefits for projects that included units renting at 130% of the area median income — meaning that developers must choose more affordable rents to qualify for the extended tax break.
The new 485-x got a muted reception from the real estate industry, whose leaders predicted it will produce less rental housing than 421-a did. Some developers have announced they can no longer build planned projects due to the program’s higher wage and stricter affordability rules, although the full effect of the tax break remains to be seen.
The Adams administration appeared happier than anyone about the housing deal, which gave the city much of what it asked for. Maria Torres-Springer, the deputy mayor for housing, said in a statement Friday that the tax breaks are “powerful new tools to address the housing crisis, and the city is wasting no time in putting them into action.”
Leases
Asset management firm relocates within Midtown
Address: 110 E. 59th St., Manhattan
Landlord: Jack Resnick & Sons
Tenant: Quest Partners
Lease size: 13,284 square feet
Lease length: 11 years
Asset type: Office
Brokers: Brett Greenberg and Fran Delgorio represented the landlord in-house. CBRE’s Hugh McDonald and Munish Viralam represented the tenant.
Sales
Astoria 16-unit rental facing foreclosure changes hands
Address: 35-16 Astoria Blvd. S., Queens
Sellers: Matthew Schwartz and Scott Minuta
Buyer: Hirshmark Capital
Sale price: $9.7 million
Asset type: Mixed use
Financings
NoHo site of Barry’s gym secures loan
Address: 419 Lafayette St., Manhattan
Owner: Albert Malekan
Lender: Citi Real Estate Funding
Loan amount: $36.4 million
Asset type: Retail
Apex Investments lands mortgage for Greenpoint homeless shelter
Address: 83 Apollo St., Brooklyn
Owner: Kasra Sanandaji
Lender: EMG Transfer Agent
Loan amount: $18.7 million
Asset type: Multifamily
Recent polling shows most voters believe lowering out-of-pocket costs is the top health care priority for the country. For low-income and uninsured patients, the impact of rising out-of-pocket costs as a barrier to quality care is particularly acute. Policymakers are focused on a potential solution: the 340B Drug Pricing Program, a federally mandated system requiring drug manufacturers to provide steep discounts on medications. This may sound like a money-saver for states, but the opposite is true. Legislators in at least twenty states are actively seeking to remove oversight of for-profit pharmacies in 340B, empowering pharmacies and pharmacy benefit managers to further drive participation; ironically, this will likely drive up state Medicaid costs.
To be sure, the program is complex. The 340B Drug Pricing Program requires manufacturers to provide discounts on drugs sold to “covered entities” (a mixture of hospitals and clinics that receive federal funding) which should help provide affordable medicines to low-income and uninsured patients. These covered entities often contract with for-profit pharmacies (over 200,000 such contracts exist today), using the pharmacies as middlemen to find well-insured patients who have received care from the covered entity and require prescriptions to be filled. When the prescriptions are reimbursed by Medicaid, Medicare, or a commercial health plan, the middlemen and the covered entities share in the profits generated by selling the patients products procured at a deep discount. The program is estimated to have generated at least $100 billion in retail drug sales last year, and roughly $50 billion in profits were shared by the covered entities and their pharmacy middlemen - mostly major chains like CVS and Walgreens.
Our research suggests that the 340B program doesn’t just cost the drug manufacturers big discounts – it also costs states real money by increasing overall Medicaid spending. Medicaid is often the largest line item in a state’s budget, and health benefits for state employees and retirees also require significant taxpayer resources. These higher costs come in several stripes. First, many states allow clinics and hospitals to earn 340B profits on Medicaid managed care patients, in effect giving the 340B entities profits that would otherwise go to taxpayers in the form of Medicaid discounts. A large portion of those profits wind up going to major for-profit pharmacy chains like CVS and Walgreens. Take New York for example. According to a 2020 presentation, the 340B margin available under Managed Care cost the New York Medicaid program over $200 million a year – not accounting for lost rebates. The same presentation showed that the loss of rebates totaled over $800 million over a four-year period and continued to increase year over year. Recognizing this, a few large states, including California and New York, have taken action to recapture the savings for themselves and saved hundreds of millions of dollars.
Perhaps more important in the long run is that the 340B program impacts not only drug costs, but many of the underlying drivers of healthcare costs. Researchers have shown that use of the 340B program leads to more expensive care choices – for instance, moving cancer care into hospital outpatient settings or encouraging the use of the treatments with the biggest 340B discounts. My own recent work shows that holding other drivers of costs constant, overall Medicaid costs per enrollee go up significantly as 340B activity increases, costing states and the federal government billions of dollars per year in increased Medicaid costs.
At least twenty states have introduced or passed legislative proposals that seek to expand the program and protect the operations of pharmacies in 340B, for example by prohibiting manufacturers from placing data reporting requirements on 340B sales. The instinct to protect 340B is politically obvious – mandating drug discounts for entities treating low-income patients has great appeal. However, 340B has become a very big business, with billions or perhaps tens of billions of profits per year shared between large, profitable health systems and their for-profit pharmacy partners, with no requirement that any share of those profits be shared with the low-income patients that policymakers are trying to protect.
While 340B profits may help smaller clinics and hospitals cope with the rising tide of near-term Medicaid losses and shortfalls, ironically 340B is contributing significantly to the pressure those clinics and hospitals are facing. Expanding 340B will likely do the reverse of what policymakers want – it will constrain health budgets rather than expand them.
While the 340B program is not a line item in any state’s annual budget, it is a major indirect driver of increased healthcare spending. Lawmakers seeking to provide efficient care to low-income patients may wish to reconsider their enthusiasm for 340B.
Neal Masia is an Adjunct Professor of Business and Economics at Columbia University, CEO of EntityRisk Inc and former Chief Economist of Pfizer.
Gov. Kathy Hochul said Thursday she is considering a partial ban on face masks in the subway after video of anti-Israel protesters wearing masks on a 5 train circulated on social media this week.
Hochul told reporters at a news conference in Albany that she is in talks with state lawmakers and Mayor Eric Adams about pursuing the mask ban due to concerns about people concealing their identity while committing antisemitic acts.
“We will not tolerate individuals using masks to evade responsibility for criminal or threatening behavior,” Hochul said. “My team is working on a solution, but on a subway, people should not be able to hide behind a mask to commit crimes.”
New York originally had a law on the books banning face masks in public, but it was repealed in 2020 by former Gov. Andrew Cuomo during the Covid-19 pandemic. Until September 2022, the state required subway riders to wear masks to limit the spread of the virus. Civil liberties groups have previously raised concerns about the mask ban, arguing that it enabled law enforcement to criminalize peaceful protests in public spaces.
The potential ban comes amid a rise in Covid-19 cases locally and as a new variant called KP.3 has surged to dominance in the U.S., according to the Centers for Disease Control and Prevention.
A reinstated ban, Hochul stressed, would include “common-sense exemptions” for religious and health reasons, as not to penalize people who wear face masks due to Covid-19 or poor air quality. Cultural events, such as Halloween, would also need to be taken into account.
The state Legislature would need to greenlight the measure, Hochul acknowledged Thursday. The governor added that she is in talks with lawmakers about drafting a bill, but the Legislature is not scheduled to return to Albany until January.
“We understand how complex this issue is,” Hochul said. “And we’re just listening to people and addressing their needs and taking them very seriously.”
Manhattan’s fractious Community Board 5 voted Thursday evening to oust the chairman who had been handed the gavel only three months ago, in a move that came minutes after members discovered that a convicted sex offender serves on the board.
CB5’s fourth chairman in four months is Brad Sherburne, a 33-year-old architect. He replaced Samir Lavingia, who rose to the helm after a boardroom brawl in March. Lavingia, 30, is the campaign coordinator at Open New York, a Silicon Valley-backed advocacy group that supports looser housing regulations and recently launched a political action arm. Called Abundant New York, the independent expenditure committee plans to aid candidates for office throughout the state.
Several longtime CB5 leaders resigned earlier this year, complaining that Lavingia and three other Open New York members on CB5 weren’t transparent about their affiliation or motivations for joining. CB5 is among the most important of the city’s community boards, with a district covering much of Midtown. The community board’s recommendations about real estate development and policy matters are closely watched by public officials. Earlier this month, The City reported that some of the recently departed CB5 leaders accepted $80,000 from an anonymous donor last year to hire an outside consultant for a zoning task force that met privately.
“I think we can all agree this has been a challenging year,” Sherburne said shortly before last night’s election.
Moments before the vote, some board members started quietly sharing a New York Post article reporting that CB5 member Charles Ny was convicted of molesting a 15-year-old boy in Great Britain 19 years ago and is listed on the New York Sex Offender Registry under his birth name, Charles Ghose. Manhattan Borough President Mark Levine, who appoints community board members, referred the matter to the city Department of Investigation, the Post said. Ny told Crain’s his conviction was expunged in the U.K. and shared a British document that said he has “no convictions for disclosure.” He is classified as a low-level sex offender in New York, according to state court records.
Ny voted Thursday against Lavingia, who was gracious in defeat.
“I’m confident that the choppy seas are behind us and there’s open blue water ahead,” Lavingia said immediately after the vote. “It’s been an honor to be the chair of Community Board 5 over the last three months and I’ll work with Brad to serve out the rest of my term and ensure a peaceful transition.”
But divisions among CB5 members were plainly evident at last night’s board elections. The vote for treasurer was 23-22, with Lavingia casting the final ballot. The votes for board secretary and first vice chair position were both 24-21. Sherburne defeated Lavingia 24-20 with one abstention.
Sherburne has served on CB5 for two years and is an architect at CetraRuddy, the firm that designed 1 Madison, the slender 50-story glass residential tower at East 23rd Street. He said he looks forward to building consensus on the many matters before the board, such as Mayor Eric Adams’ City of Yes housing plan.
“I think I can help end the division that has distracted our board and quell the controversy of the recent months so we can get back to work for our community,” he told CB5 members minutes before the voice vote.
As weary voters filed out after the four-hour meeting, CB5 member Zool Zulkowitz said he doesn’t see the rancor lifting anytime soon. Republican and Democratic party operatives have discovered the power of community boards to influence elected officials, he said, and are investing to remake them.
“American politics as we’ve come to know and hate it has come to this level of city government,” Zulkowitz said.
As we saw with Enron, executives in trouble might say anything to protect themselves, senior reporter Aaron Elstein writes. Plus: A look at the week ahead
Mary Bassett will be returning to the Harvard Chan School of Public Health, where she previously served as a professor in the social and behavioral sciences department
An independent investigation by a law firm found no evidence of wrongdoing by Ibrahim Khan
A lawsuit filed by conservative platform Rumble says the measure could hobble free speech
Leaders in city government, affordable housing and technology are among those making headlines
If the project goes off track, residents and businesses in the five boroughs could suffer electricity shortages, industry observers warn
In May the NYPD received an anonymous tip alleging prostitution was taking place at the building
Recognizing the enormity of the city's housing crisis, a trio of major projects in Astoria and Throggs Neck received the green light to move ahead this fall
The number of new signed contracts in Manhattan is nearly half of the levels reported in November 2021
Plus:
- Medical device startup raises $62M
- Northwell opens two multidisciplinary practices in Suffolk County
- Catholic Health reports slim operating margin for Q3
The move comes amid questions about how best to oversee the crypto industry in the wake of FTX's high-profile collapse
The merger was delayed by regulators taking a tougher stance on financial mergers and acquisitions activity
Maria Torres-Springer, deputy mayor for economic and workforce development, is set to answer reader queries during a live Crain’s event
Residents of 111 Leroy St. say the company should have covered costs during the marketing period
The cost-cutting financial plan proposes a 5.5% fare increase, efficiency-boosting measures and debt savings
More than 1,000 people were on the list for government-funded help as of mid-November, according to data shared exclusively with Crain's
The troubled crypto exchange is on the hook for $336,000 owed to cloud-based marketing services provider Braze
A hotel developer has claimed four neighbors are blocking efforts to start construction on a planned 32-story tower
H Mart heads to Long Island City, and InSite Property Group gets a loan from Goldman Sachs
The Brooklyn congressman will be the first Black lawmaker to head either party in Congress
Lindsay Zegans of Ripco says her experience as a consumer of brands like Planta and Loeffler Randall helps her build trust and secure deals
The firm acknowledged that rapid expansion during the pandemic has led to mounting losses
The hospitality firm and Moxy Hotels have already collaborated on three other spots this year
To enable essential research, the city needs world-class facilities, writes Jonathan Schifrin, a vice president at CBRE
From kimonos to delis to sharks, these are the hottest exhibitions to see when it's cold outside
Nearly half of the 3,000-plus units coming with Innovation QNS will be affordable, but the Adams administration doesn't appear to have a second act
A soccer stadium in the five boroughs could win back international tourists, write Crain's editors
Plus:
- Prenatal and mental health care providers must collaborate to improve outcomes, state review board says
- Hochul signs bill that bans wage garnishment in medical debt lawsuits
- New York–Presbyterian reports data breach affecting 12,000 patients
Small and midsize businesses are dealing with more challenges than ever before: inflation, supply chain challenges, and changes in the way customers are purchasing and experiencing products. These customers are seeing the value of technology to drive revenue, improve operational efficiencies and scale their businesses. In fact, 61% of small and midsize businesses have implemented digital tools to change processes and improve customer experiences, according to Verizon’s third annual State of Small Business survey.
A 24/7 Tech Concierge Service Offering Plug and Play Solutions
Enter Verizon’s Technical Services Organization (TSO) - created early 2021 - consisting of solutions architects, product specialists, engineers, industry specialists, and technical experts that provide businesses with 24/7 guidance and a full service, plug and play approach to tech solutions. They advise on everything from mobile edge, on-site networks, and fixed wireless access to cybersecurity, customize a tech solution approach according to the business’ needs, and stay with the customer every step of their journey. This personalized, simplified and dedicated approach is a key differentiator for the Verizon Business customer experience.
A telecommunications installation company recently struggled to satisfy their cyber insurance requirements. Their cost of staff dedicated to response was untenable and their incident response plan was not well-documented. They needed flexibility and agility. We drew up a rapid response retainer, created response SLAs, and invested more than 40 hours of assessments for incident response preparation. The result was reduced rates, 3-hour SLAs, and a more proactive approach to cybersecurity. This is the type of personalized, plug and play tech concierge customer service that the TSO provides to our customers every day.
A Unique Approach: A True Partnership
Economies are adjusting and industries are still evolving. Agility and adaptability are paramount. This is especially true for small and medium businesses, as they’re more vulnerable to market changes and often lack the resources to adapt as quickly as larger enterprises. However, to do that effectively, they need full service tech solutions to adapt to these changing environments.
It’s easy to say that full-service solutions are the answer but how do you deliver them? Of course the right technology is instrumental and for Verizon, much of that is driven by 5G, which is empowering our customers to uncover new opportunities. However, the only way to deliver a full and thorough service is through a true partnership, taking into account our customer’s input and needs. This is critical to the process. We might possess the most responsive solutions in the world, but for our solutions to be successful, we must bake a customer’s communicated needs into their formulation.
For a local hospital struggling to maintain critical communication, this means creating seamless patient-clinic communication throughout the patient journey. For a family-run pizza chain facing business continuity issues, this means delivering reliable connections. For a regional transportation company struggling with device management, single sign-on capabilities and a streamlined app ecosystem are needed. For event venues with bandwidth challenges, we created private wireless network solutions with dynamic network configurations. Specific solutions for specific challenges.
Change Creates Challenges and Opportunities
Historically, technology adoption has lagged behind innovation. For instance, the infrastructure for streaming services was in place long before the cord cutters migrated en masse. We’re now in a period of accelerated change. The technology that can help small and midsize businesses adapt to that change is available and critical, as the range of challenges emerging is wider than ever, demanding more customizable solutions than ever before. Change creates challenges, but it also creates tremendous opportunities.
To learn more about how technology can empower small businesses to grow and evolve their business, engage with our team click here . Beyond special offers and discounts, businesses can receive a tech evaluations with trained Verizon Business experts, including our TSO team, to provide tailored technical solutions to grow your business.
A plasma donation center inks a Brownsville lease, and Madison Realty Capital buys a bankrupt Williamsburg site
The utility had argued that it should have owed less from 2013 through 2016 because its income is limited by the state
The Brooklyn resident masquerded as a health care worker to rent city-funded rooms to customers
The company has assembled an army of more than 75 robots to help firms ship apps faster
The City Council is approving big projects, residential rents are strong, and legal weed should give retail a boost
Plus:
- Montefiore plans $4M cardiac cath lab upgrade at Weiler Hospital
- City must pay entire cost of municipal retirees’ supplemental health plans: ruling
- Startup for health care data insights raises $10M
The City Council approves what is expected to become the largest private housing project in Queens
The decision is the latest installment in New York’s attempt to privatize health insurance for more than 200,000 ex-workers
The longtime Manhattan congresswoman could be in violation of House rules whether or not she attended the 2016 event
The state enacted a law this year that puts shareholders on the hook for customer credits and reimbursing the costs of spoiled food and medicine
The sales comes amid a flurry of real-estate moves for the widow of GE honcho Jack Welch
The Book, our annual compendium of a year’s worth of New York-centric data, is your guide to power in the city. It contains exclusive lists and data collected by Crain's to help you qualify leads, analyze the market and research potential investors, vendors and employers.
This is much more than a book of lists. It is your essential guide to everything you need to be successful in business in New York. In addition to detailed dossiers on companies and leaders, The Book has everything you need at your fingertips to research how business works in the city.
The print edition is an invaluable resource dog-eared by business leaders throughout the year, and there's even more — including downloadable spreadsheets with much more for Data Center subscribers to explore — online.
The 2023 edition of The Book will soon be delivered to Crain's subscribers; become one today to secure your copy. Here's just a sampling of what's included:
- Privately-held companies: The largest companies in the city, based on revenue. The 2022 list focuses on FY2021 figures, for a look at how local companies fared in the year immediately following the pandemic's fallout.
- Nonprofit executive compensation: New this year, we're rounding up pay data on the city's nonprofit leaders, so organizations in this sector can explore trends and stay competitive.
- Indispensable lists: Rankings and information from our Data Center that you won't find anywhere else, including the area's highest paid CEOs, largest property sales and much, much more. Online, these lists are available exclusively to Data Center subscribers.
Plus:
- VC firm closes $83M fund for early-stage health care investments
- City Council passes bill to create syringe buyback program
- Flatiron sleep health startup raises $9.6M in Series A round
After two years, Joe Lockhart and Giovanna Gray Lockhart unload their Brooklyn townhouse for $8M
The Via-led platform is supposed to allow parents and educators to monitor pickups and drop-offs in real time
Italian restaurant Jupiter and farm-to-table spot Five Acres are joining the Midtown neighborhood
Expect higher fares and fewer flights, but airlines are vowing to meet the demand with minimal inconveniences
A law firm increases its Financial District footprint, and Madison Realty Capital closes on a pair of Cobble Hill sites
The hotel was purportedly supposed to include a new sanctuary for the Garment Center Congregation after Soho Properties demolished its original building
The state awarded 36 licenses for 28 individuals and eight nonprofits at its meeting Monday
Despite flat acquisition rates at most firms, Cushman & Wakefield increased its portfolio by roughly 10%
New York City has a long history of reinvention. And in today’s case, health is at the forefront of the city’s next phase. In recognition of leaders defining what this looks like, Crain’s Content Studios and Empire BlueCross BlueShield partnered to salute 25 Empire Whole Health Heroes—a cohort of New Yorkers devoted to revitalizing this city after the pandemic threatened the health of New Yorkers as individuals and as a collective.
Kicking off a celebratory event in their honor, Fred P. Gabriel, publisher and executive editor of Crain’s New York Business, noted the honorees’ occupational diversity, representing that so many factors influence health.
“This year’s Whole Health Heroes hail from a variety of industries, from medical research to social services,” he said. “But all are united by their efforts to build a better New York.”
According to Victor DeStefano, general manager of New York commercial for Empire BlueCross BlueShield, those efforts align with his company’s goals.
“We have more than 85 years of history working in New York,” he said in his opening remarks, “and our mission is to materially and measurably improve the health of all New Yorkers.”
This historic foothold in the region energizes the team at Empire BlueCross BlueShield, which draws inspiration from the city and the many diverse people that make up this metropolis. “In a fast-paced market like New York, every day we are reinventing ourselves,” said Alan J. Murray, the company’s president and chief executive officer, in his keynote address. “That’s in response to challenges, yes, but also to the incredible innovation we have here.”
Murray, a British expat, went on to share his perspective on the U.S. healthcare system, which he called “the greatest in the world.”
“I come from a country with universal healthcare, which sounds wonderful,” he said. “But the reality is that there are many limitations around what care people receive, and when.”
For Murray, the matter is not merely academic. He recounted a personal story where a family member had to wait 30 days before a professional would even make a diagnosis.
“That wouldn’t happen in this country,” Murray said. “People like our honorees make sure their neighbors have access to great healthcare, as well as the financial and social support that make people feel more human – especially in their most vulnerable moments.”
To him, the takeaway is clear: It is incumbent on leaders—and all people—to make a difference in the lives of others. “Honor yourself by waking up every day with that purpose,” Murray concluded.
Next up was a panel discussion, moderated by DeStefano, in which three honorees shared their motivations and efforts to bolster the wellbeing of New Yorkers.
As chief executive officer of Bayesian Health, whose AI-enabled platform delivers clinical insights that help physicians proactively find and address life-threatening conditions, Suchi Saria is among the vanguard of experts applying machine learning to healthcare.
“Digital records give providers a view into a patient’s every healthcare interaction: labs, vitals, symptoms, treatments, responses,” said Saria. “When you add in machine learning, vast amounts of data can be rigorously analyzed. Lifesaving patterns and predictions emerge.”
That’s especially critical when addressing conditions like sepsis, in which early detection is key. “Data helps identify patients most at risk,” said Saria, whose nephew died of that disease. “AI augments frontline caregiving.” DeStefano highlighted how Saria’s work aligns with one of Empire’s latest initiatives, which is bi-directional data integration with New York’s hospitals.
Panelist Ramona Cedeño highlighted another arena of wellbeing: financial security. As chief executive officer at FiBrick, an accounting firm providing boutique services to small and midsize businesses, she empowers clients to make informed financial decisions conducive to business growth.
“Research shows that financial worry can contribute to physical and mental health issues,” she said. “This was especially pronounced during the pandemic, when many people lost jobs and businesses were foundering.”
Inspired to share her financial expertise beyond FiBrick’s client base, Cedeño began producing more content—from social media posts to newsletters—to educate a broader audience about financial planning. “The more we bring these issues to the forefront, the better off people will be,” she said.
The value of education was also noted by Leonard Achan, president and chief executive officer of LiveOnNY, a nonprofit that facilitates organ donation in the region. He pointed to pervasive ignorance—not to mention myths and misconceptions—around the issue.
“I was a NICU nurse, I worked bedside for 20 years, and I did not know how many lives a single tissue donor can change,” said Achan. “People can be heroes even in their deaths.”
He joined LiveOnNY about a year ago, as the organization sought to recruit healthcare providers to turn around New York’s historically low organ donation rate. Thanks in part to those efforts, New York State broke institutional records for organ donation in the first half of 2022.
The event ended with the distribution of crystal awards to the Whole Health Heroes, interspersed with short videos of the honorees describing their work.
In closing, Gabriel lauded the honorees’ accomplishments and called it “a privilege to work with Empire BlueCross BlueShield to bring their stories to life.”
Bidders are fighting for the right to open a downstate casino that could generate as much as $2 billion in annual revenue
Supporters promise a windfall of tax revenue, but some analysts see the money as a flash in the pan
When done thoughtfully, these businesses can have lasting impact on the host community in the creation of sustainable, well-paying jobs
Officials should not be tempted to use the funds for other purposes like property tax relief, write Crain's editors
The 31 honorees are an accomplished group that is breaking barriers in a male-dominated industry
The low count of new housing units, as well as the city's subsidies and forgiveness of property taxes, make the Willets Point soccer stadium less attractive, writes columnist Ross Barkan
Plus:
- MultiPlan reaches $33.75M settlement in suit over SPAC merger
- Hochul earmarks $3.3M to expand mental health care for young New Yorkers
- Memorial Sloan Kettering sees widening losses in Q3
The persistent rains of social engineering attacks, where cybercriminals trick us into doing their bidding using techniques such as spear phishing emails, are combining with the gale force winds of data breaches and the destructive and all-too-frequent lightning strikes of ransomware, creating a foreboding and perfect tempest of cybersecurity threats that are rapidly bearing down on the financial services sector.
With each passing day, cyberattacks are becoming more sophisticated and capable of circumnavigating security defenses with an ever-increasing level of efficacy. Gone are the attacks resulting in small, isolated money grabs and minor production outages. Instead, financial service organizations are seeing exponentially more devastating impacts, resulting in multimillion-dollar fines, irretrievable data, prolonged disruption of operations and perhaps most important, brand degradation in the eyes of their customers.
Some samples of the catastrophic impact of these attacks:
• Capital One had more than 100 million credit card applications compromised after cybercriminals took advantage of a firewall misconfiguration. The attack resulted in fines of $80 million and customer lawsuits of $190 million.
• Experian experienced a data breach that resulted in more than 24 million customer records and nearly 800,000 business records being compromised after an employee was socially engineered into providing access.
• Desjardins, Canada’s largest credit union, was victimized by an insider who gained unauthorized access to millions of member records, causing estimated damages of more than $100 million.
• Flagstar Bank, one of the largest financial providers in the U.S., was the victim of a massive data breach this year. It was reported that Social Security numbers belonging to 1.5 million customers were compromised in the attack, triggering a series of costly class-action lawsuits.
Should members of the financial sector feel that they are not the most desired targets of cybercriminals, the consensus of researchers would indicate otherwise. According to IBM’s “Cost of a Data Breach Report 2022,” financial organizations experienced the highest percentage of attacks, compounded by having the second-highest average breach costs of almost $6 million. Verizon’s “Data Breach Investigations Report” says the financial sector experienced more data breaches than any other industry. VMware Carbon Black’s “Cyber Security in Financial Services” report provides another stark assessment of the financial services industry, saying that it is “subjected to the highest rates of attack of any vertical market, the source of one-third of all data breaches”.
Why are cybercriminals focusing their attacks on the financial services sector?
There are several key motivating factors. First, and perhaps foremost to criminals, is the tremendous amount of sensitive information that is stored and processed by businesses in the financial sector, often for extended periods to meet retention regulations. Second is the accessibility to the financial assets of customers, many of whom may be high-net-worth or even ultra-high-net-worth individuals. Factor in the industry’s reliance on an intricately connected system of devices, web and mobile fintech applications, and financial systems and supply chains, some of which adhere to a less-than-optimal level of security, and it is easy to imagine the multitude of ways that attackers can gain unauthorized access.
While there is no easy path to a secure destination that is invulnerable to cyberattacks, businesses can reduce their risk and increase their ability to avoid becoming the next data breach headline. While there are new and exciting technologies that are leveling the playing field in the battle against cybercriminals, including artificial intelligence, automation and robust security frameworks, there are essential building blocks that every financial services business should implement. They include:
• Assessments
Conducting cybersecurity risk assessments on a regular basis will allow businesses to identify where their risks lie so that they can direct remediation resources to where they are needed most. The scope of an assessment should include key third-party vendors, suppliers and other partners. Once an assessment is completed, it is critically important to repeat the process on a regular basis to reflect the constantly evolving threats and changes in technology.
• Awareness
Since the preponderance of attacks are geared toward socially engineering humans, it is critically important to educate all employees on the importance of defending their business against the nefarious schemes of criminals. While training is instrumental to every cybersecurity strategy, testing users with simulated social engineering attacks will arm employees with an instinctual ability to avoid cyberthreats. This approach will convert employees from what is typically the weakest link in the security chain to a virtual human firewall capable of drastically diminishing the chance of a successful cyberattack.
• Resilience
Taking the mindset that a breach is not “a matter of if” but “a matter of when” may seem like a defeatist attitude, but it is, in fact, a constructive one. By preparing for the day when the cybercriminals outmaneuver your defensive efforts, having a plan to respond and recover will slash downtime and the expenses related to returning to operational status. This preparation includes the secure creation of dependable backups, the development and regular testing of incident response and disaster recovery plans, and the acquisition of a cyber insurance policy.
The cybersecurity challenges facing the financial services industry are many, with businesses forced to defend themselves from an onslaught of criminals looking to enrich themselves with stolen information and ransom demands.
With a strategic approach that weaves cybersecurity into the fiber of every financial services business, however, the industry can weather the storm and reach for a brighter tomorrow.
For more information on securing your financial services business, contact Kevin Ricci at kricci@citrincooperman.com or Alexander Reyes at areyes@citrincooperman.com.
“Citrin Cooperman” is the brand under which Citrin Cooperman & Company LLP, a licensed independent CPA firm, and Citrin Cooperman Advisors LLC serve clients’ business needs. The two firms operate as separate legal entities in an alternative practice structure. Citrin Cooperman is an independent member of Moore North America, which is itself a regional member of Moore Global Network Limited.alternative practice structure. Citrin Cooperman is an independent member of Moore North America, which is itself a regional member of Moore Global Network Limited.
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There was stiff competition for the year's finest in business folly and foibles, writes senior reporter Aaron Elstein. Plus: A look at the week ahead
Leaders in the nonprofit sector, politics and finance are among those making headlines this week
Tribeca Investment Group, Meadow Partners and PGIM Real Estate secured the loan for their work at 295 Fifth Ave.
California-based StandardC helps entrepreneurs solve for complexity around accessing capital and business services in an emerging industry
New York’s clean transportation prizes program doled out $85 million in grants to innovative projects across the state
The state Dormitory Authority has selected 10 teams of construction and architecture firms to spearhead work on about 150 stores
A home furnishings firm grows its Fifth Avenue footprint, and Corner Street Capital buys a Ridgewood apartment building
Plus:
- Einstein researchers get $6.6M federal grant to lead consortium of young scientists
- Garnet Health reports a slim loss in Q3 as utilization dips
- Crain's Notable Leaders in Real Estate: Arlo Chase, Senior vice president of real estate development, Services for the UnderServed
Under the terms of a new proposal, app-based delivery companies would be required to pay their independent contractors $23.82 an hour, adjusted for inflation, by 2025
Without action, the money could be exhausted as quickly as two years from now, according to Brad Lander’s latest report
If its request is approved, New York would gain nearly $54 million more a year for Medicaid from the federal government
The bank settled two years ago in a deal that kept secret her detailed account of senior executives making vulgar and dismissive comments about women
Fewer commutes brings more foot traffic to local businesses and helps neighborhood growth, said EDC President and CEO Andrew Kimball at a Crain's event Wednesday
Without a creative effort to stem the diaspora of New Yorkers, we'll be hurtling back to the bad old days of the '70s, writes Ellis Verdi, president of ad agency DeVito-Verdi
The Soldiers', Sailors', Mariners', Coast Guard and Airmen's Club shuttered during Covid and never re-opened
A utility meter maker relocates in Long Island City, and an East New York industrial site sells
Prominent housing issues for the governor are likely to include a potential 421-a replacement and "good cause" eviction
Plus:
- Oscar Health reports another large loss as stock hits new low
- Paramus hospital opens eating disorder treatment center
- Crain's 40 Under 40: Daniel Brillman, co-founder and CEO, Unite Us
The city's role as a hub for the tech giant's lucrative ad sales business means many local workers may keep their jobs
The Tribeca-based company, down 90% from its high, has found that insurance is a tough industry to disrupt
Dos Caminos renews its lease in Midtown South, and Topdrawer inks a deal in SoHo for its first Manhattan store
Moliving's mobile rooms on wheels aim to provide a five-star experience at a bargain price
Republican Mike Lawler upset Sean Patrick Maloney in NY-17, and George Devolder-Santos flipped a seat to the GOP in NY-3
Morris Moinian purchased the four sites the building sits on for $36.6 million between 2014 and 2016
Now they can be more realistic about what to do with their buildings if workers don't come back
The largest such environmental measure in state history would authorize $4.2 billion to fund critical projects—without raising taxes
Retirees could tell the City Council how New York can save money while honoring promises made to workers over the decades
Three years into the state's adoption of early voting, turnout is starting to normalize following spikes driven by the pandemic
It’s enough to make the association one of the top 50 donors in Tuesday’s election, according to a recent analysis
Miles of cable will power safety measures, broadcasting and runner tracking during the five-borough race
A private equity firm expands its office footprint, and a portfolio of Forest Hills buildings sells
The highest-profile addition to the list is Dhamaka, a Lower East Side Indian spot whose specialty is a whole Rajasthani rabbit
Carbone, Marea and Peter Lugar lost their top rankings, while a quintet of eateries retained the top spots they've held since 2018
The city risks falling behind without innovations in waste management, renewable energy and micromobility
Plus:
- Health + Hospitals more than doubles its fleet of mobile test-to-treat units
- Morris Heights Health Center opens $6.2M Flatbush FQHC
- Stony Brook Medicine joins Partners Health Plan network for patients with disabilities
Idyllic home in The Cliffs at Walnut Cove defining modern luxury in Asheville, NC. Entirely custom built and truly an irreplicable opportunity for a mountain retreat.
A federal judge said Thursday that there was no historical basis for restricting concealed weapons in Times Square and other areas
The Taxi and Limousine Commission is proposing pay bumps for app-based drivers as well as the first metered fare increase for yellow and green cabs in 10 years
The company says it’s the largest-ever fundraising round for a Black woman–led firm in the food and beverage sector
Emergency Management Commissioner Zach Iscol said the Texas border wall company SCSLO did "tremendous work" for the city during Covid-19
A record infusion of capital funding will become available to arts organizations across New York state in a move that puts the state’s commitment to the arts in line with New York City’s emphasis on the sector, Gov. Kathy Hochul announced.
Hochul said the state will make $150 million available through the Council on the Arts’ Capital Projects Fund. The council will direct two-thirds of the money to multiyear funding intended to allow organizations to work on large-scale projects, the governor said.
“New York’s powerful creative economy is a crucial driver in our state’s recovery as a global cultural leader,” council Executive Director Mara Manus said, adding that the money was instrumental in underscoring “the critical role these projects play in our economy, our local ecologies and the health of all New Yorkers.”
The funding will enable two different grant programs. First, small and midsize capital improvement grants will pay for up to $2 million on projects that “prioritize accessibility, artistry, cultural development, sustainability, health and safety, and structural and historical improvements,” the governor’s office said.
The second program is for larger capital-improvement grants, ranging from $2 million to $10 million, to benefit projects that cost at least $4 million. Recipients have to commit to social-equity initiatives and access plans as a way of advancing the state’s diversity and equity goals.
The announcement follows two years of relief funding for the arts, from the federal Shuttered Venue Operators Grant, intended to help arts organizations make up for lost 2020 revenue during the early parts of the Covid-19 pandemic. In New York, a $200 million tax credit for musical and theater production is still in effect, as a way to assist theaters in their comeback.
The new funding, by contrast, is focused on expansion and sustainability, the state said.
“For the past several years, arts and cultural organizations have navigated challenge after challenge, and many are still struggling,” said Assemblyman Daniel O’Donnell, who represents portions of Manhattan. “It's time for an arts renaissance in New York state.”
The application portal opened Friday on the state Council on the Arts website. The deadline for applying is Jan. 12.
Trump’s election suggests that much of the rest of the country does not mind combative, arrogant politicans
Leaders in health care, city government and real estate are among those making headlines this week
Manhattan representatives Christopher Marte and Carlina Rivera are fighting over who will represent the Vladeck Houses on the Lower East Side
Former Conde Nast space gets another sublet, and Black Spruce closes on a Midtown East apartment building
The city needs a mechanism to oversee the many programs serving the homeless population
The legislation is limited in scope because the money is administered by the federal government, stakeholders say
Leaders in transportation, health care and the city’s startup scene are among those making headlines this week
The amendments could prevent landlords from combining apartments in order to raise rents
It is important not to repeat the mistakes of our past—particularly those around the HIV epidemic—says Jonathan Santos-Ramos, interim director of the Callen-Lorde Community Health Center
Plus:
- New York–Presbyterian Hospital cinches 5% profit margin for Q2
- Research finds 6 in 10 patients say they'd pay more for better care
- Meet more of Crain's 2022 Notable Health Care Leaders
The city is planning a comprehensive expansion of its bluebelt program to naturally sop up rainwater