January 20, 2015 by admin

Real Estate Wasn’t Genteel for Daughters

I come from a family that has owned New York City real estate for three generations. Not a lot: we have shares in two Manhattan office buildings that were built in the early 20th century. (We also used to own one-quarter of the iconic Flatiron Building, which we sold in the 1990s.) We also own a few beautiful houses in Tennessee thanks to a Spring Hill Tn realtor, but thats outside of New York. Small potatoes, as my father used to say. Nothing compared to the mega-holdings of well-known real estate families like the Silversteins or Goodsteins or Roses.

Still, in 2014 New York, our properties are very valuable. We are planning to expand and have just begun looking House for sale in Hua Hin Thailand. My grandfather, Abraham Braun, a Hungarian immigrant who arrived in New York in 1914, acquired these buildings in the mid-1940s, along with three partners. Among them was a youngster named Harry Helmsley, who went on to become one of New York’s great real estate moguls. Grandpa Abe, who read voraciously but couldn’t write — probably he had never gone to school — died in 1947, of leukemia. He was only 51. My mother, his daughter, says that if he had lived longer, he would have become immensely wealthy, like other hard-driving Jewish immigrants who started out like him, one building at a time.

Abe had no sons and never talked about his business dealings to either of his two daughters. This despite the fact that he was a man ahead of his time: he sent both daughters away to college, and told them to study something “practical.” Every woman, he said, should have a career. She should not depend just on her husband. Not the typical advice immigrant Jewish fathers were giving their daughters in the 1940s. (My mother listened, and became a chemistry professor.)

Yet there were limits to my grandfather’s open-mindedness regarding women. Studying was one thing. It was genteel, ladylike. But real estate — and, by extension, money — was not. My mother and her sister never questioned this assumption. After their father’s death they offered no input into overseeing the properties they inherited, assuming that my father, being male, would deal with this. And he did in part, although he had no say in how the properties were managed. That job was under the control of Harry Helmsley’s company, Helmsley-Spear.

Fast-forward to the mid-1990s, when my husband and I discovered that the Helmsley employee acting as managing agent had for years been taking kickback from contractors working on our properties. Serious kickback. He had left a detailed and damning paper trail that we managed to acquire. My husband and I informed the other partners. Chaos ensued. We decided to oust Helmsley-Spear — namely Harry’s notorious wife Leona (she who by then had served jail time and who, after her death, left twelve million dollars to her dog) and a squad of expensively clad men who worked for her. They refused to leave. Helmsley-Spear held all the bank accounts, and wouldn’t give them up.

By default, responsibility for fixing this mess fell to me. Like me, the other partners in these buildings had inherited their shares in these properties. Most did not live in New York. Those who, like me, were local seemed to have no interest in getting their hands dirty stewarding these Manhattan real estate holdings.

I needed all the chutzpah I could muster to seize back and clean up what belonged to our family and its partners. But acting as an owner was a new concept for me. Just thinking about this now, some 20 years later, my heart beats fast. Acting aggressively in a commercial context was not what a good Jewish daughter was supposed to do.

My grandfather’s message to his daughters had been passed down to me. Like my mother, I was educated in academic realms, not business; I taught Greek and Latin. My parents, modest and thoroughly decent people, deplored any show of wealth. At best, they felt ambivalent about having “property.” There was something about the visibility of it that upset them. They were afraid that people would think of them as wealthy. Grandpa Abe Braun certainly hadn’t felt that unease. My mother told me that he was proud of the buildings. As well he should have been.

Suddenly I knew that if I didn’t fight for the buildings we’d inherited from Abe, we stood to lose them.

So I forged ahead. For four years, I did battle with Helmsley-Spear. Along the way I acquired an education quite different from my background in classics. Real estate, I learned, is a dirty business. People fight like dogs over every square inch. If you don’t protect what is yours, watch out.

I also learned (why was I surprised?) that real estate is a men’s game. (Leona Helmsley was an anomaly: she gained her power in the industry the old-fashioned way, by marrying the boss.) Women who got into the game were vilified. As I fought to take back my grandfather’s property, I endured chronic insults from men who worked for Leona. One tried to placate me by inviting me out to lunch. “Are you fucking kidding me?” I replied. “Don’t abuse me!” the man shouted. Soon I developed a justified reputation as a woman with a big mouth.

Finally, we ended up in court. A sweet victory was ours. The judge removed Helmsley-Spear as agent, and our properties emerged intact. I hired another management company, and I was made managing partner.

With a few exceptions — the most notable being Donald Trump — the big developers in New York City are, in the tradition of Grandpa Abe, Jews. This is also true in other major American cities. The foray of Jews into real estate began at the beginning of the last century, when they arrived here by the hundreds of thousands from Europe, where they were often prohibited from owning land. Not so in the Golden Land. Jewish immigrants and their sons — but not daughters — scraped together their pennies and closed deals on old, shabby buildings with a handshake.

That world has long ceased to exist. Today, as New York is rapidly becoming affordable only for the super-rich, a grimy industrial loft in the Flatiron district — such as what my grandfather and his partners bought for bubkes — is now worth millions of dollars. With this lure, many owners are selling out to huge developers armed with mind-boggling quantities of capital, much of it coming from abroad. The old buildings are soon destroyed. In their place? Postmodern glass-clad skyscrapers rising to previously unthinkable heights. Tall “needle” buildings perched on small lots the size of my apartment’s living room. All around them, you hear the clang-clang-clang of heavy construction machinery. In New York City, old buildings not officially designated “landmark” are in danger of disappearing.

Men — not women — are typically the ones building these out-of-scale skyscrapers, and real estate remains very much a man’s game, even as the number of women in the industry has recently increased. In 2012 the New York Observer reported that 40 percent of real estate professionals around the country were women. By now the figure is higher. But these numbers count women working in real estate in any capacity. Almost no women acquire executive power in this business. The few women who do — in New York and also in other cities, like Washington D.C. and Chicago — are typically the daughters of big developers. (It seems my grandfather’s dictum no longer applies.) Lisa Silverstein, 47, oversees the residential side of Silverstein Properties, developers of 1 World Trade Center. Amy Rose, 47, with her cousin Adam Rose, runs Rose Associates. Laurie Zucker, of the Zucker Organization, builds residential projects. Zucker, 58, estimates that there are perhaps 15 women in New York who are working in some capacity in their fathers’ real estate companies. She herself studied piano at college, but since 1977 has been working with her father, Donald Zucker, 83. She says that she does a lot of the design work, which includes selecting the construction materials (“I love creating buildings”). She is also in charge of managing the properties. When her father retires, she is slated to head up the company. When she started doing this, she told me, “I was often the only woman in the room. It was difficult. A lot of people didn’t take me seriously.” Working in a family company did provide her with a precious perk other women find hard to come by: time flexibility when her children were young.

Today, Zucker’s title is vice chairman. When asked when she will be the official CEO of her father’s company, which manages approximately 2,500 apartments in the New York City area, and has built or restored 28 residential buildings in Manhattan, she answered: “I don’t need the title CEO. I don’t care about titles.” Her only concern, she said, is to get the job done. Zucker is a partner on a lot of buildings with Shari Goodstein Rossi, whose father’s company, the Goodstein Organization, has built 30 apartment buildings in New York, among them Battery Park City. Back in the 1940s, their grandfathers did deals together. Goodstein Rossi began working for her father, Steven Goodstein, when she was 18 and fresh out of high school in Great Neck. The first thing she did was to figure out that an employee was stealing from him. Today she oversees her family’s financial portfolio. “I have to do real estate,” she says. “I have no choice. It’s your legacy, you have to protect it.” Her father never gave her an actual title. Her job is always to “do what my father says,” she tells me. Her relationship with him is “raw, but wonderful.”

“He,” Goodstein Rossi says, “is the patriarch.”

What are the practical — as opposed to the emotional — impediments to women’s advancement in this burgeoning and profitable industry? To develop property, you need a lot of capital. Women do not have the same access to capital as men do, so New York has few women developers who came into the business on their own. One of these is Susan Fine, whose father, a Boston real estate lawyer, owned some property there. As a developer or as project manager, she was behind the redevelopment of mixed-use space at the World Financial Center in Battery Park City and 20 years ago she conceived and implemented the entire $250 million redevelopment of Grand Central Terminal for the Metropolitan Transit Authority.

“My projects are small,” she says. “If I were a guy I’d have 10 projects going. I do two at a time, on a certain scale. I don’t compete with the big boys. And they are not interested in my projects.”

Aha.

Fine invests her own money in these projects, along with other partners, and she made her money buying and selling buildings. “Life to me is all about Loehmann’s,” she said, referring to the now-defunct and much-beloved women’s discount clothing retailer. “This is how you buy property: with bargains.”

Fine remarks that real estate is one of the few businesses where you can go from zero to “a gazillon dollars” in one lifetime. But, she says, to make money, “you either have to cut costs or raise rents. Neither option is very appealing.”

“Real estate has no rules, no ethics, no crimes and no punishments,” Fine says. “The only motivation to do right by people is that [otherwise] they won’t do a deal with you again.” Still, for all its nastiness, Fine says she loves the real estate business — every part of it. (“I like the cholent analogy,” she says, alluding to the Shabbos casserole that contains a variety of distinct ingredients.)

“I got into it because I believe that the physical environment really changes people’s lives,” Fine says. “The intersection of physical design and policy fascinates me.”

One of Fine’s current projects is the development of Turnstyle, the shopping concourse inside New York’s immense Columbus Circle subway station. This station is the seventh busiest in the system; nearly 23 million riders pass through it yearly. It is located right in the heart of things, next to Central Park, and surrounded by some of Manhattan’s poshest commercial and residential buildings.

Brooklyn real estate is as hot as Manhattan’s. In this once-depressed borough of New York City, another female developer, Abby Hamlin, principal of Hamlin Ventures, has built stunning multi-million-dollar townhouses. But across the street from these, she partnered with the nonprofit Common Ground on the award-winning Schermerhorn House, a striking glass-paned building which houses low-income people, especially those in the arts, as well as the formerly homeless.

So we have innovative women developers transforming interior underground space and creating affordable housing. Whereas the “big boys” are in a never-ending contest to build the highest skyscraper. But it is not just the men who love tall buildings, which are an essential part of New York’s fabric. In 2013 Amy Rose told The Real Deal: “The thing I’m most proud of in my career is working on those ground-up development projects that shape the New York skyline.” 

In Proverbs 31, 16: we read of Eishet Chayil, the woman of valor. “She considers a field, and buys it. With the fruit of her hand, she plants a vineyard.” It turns out that owning real estate, and reaping the benefits of it, were honorable Jewish women’s activities even back then.

This is helpful for me, a Jewish woman, to remember. It implies that there is an ethical way for my partners and me to own and rent out our property. When people lease the places where they live, or places where they make their living, your property becomes their personal space. How you manage your property directly affects the quality of their lives. This is a grave responsibility.

But squeezing the maximum value out of a piece of real estate — for example whether raising rents or cutting expenses — by definition conflicts with tenants’ interests.

Sometimes I ponder whether it is time to sell my grandfather’s properties. They are filled with small businesses: dentists, clothing designers, travel agents, architects. The buildings throw off a lot of income, and are worth a lot of money. One of them, a beautiful old 16-story office building, sits on 57th Street–just east of One57, a new 75-story uber-luxury condo tower that epitomizes the current Gilded-Age mentality.

But on 57th Street, old buildings like ours are disappearing. The small retail spaces that they housed, which used to give the street its New York-esque flavor— Uncle Sam’s umbrella emporium, where I remember going as a child, The Ritz, selling gently used fur coats, the ornately gorgeous Rizzoli’s art book store—are gone. It is businesses like these, the urban thinker Jane Jacobs wrote 50-plus years ago, that fire a city’s economic engine. Their presence, she said, make a city alive. Today, developers are destroying the buildings that house such businesses. In their place, they are putting up out-of-scale glass-paned skyscrapers like One57, that stick up above the Manhattan skyline like erect penises. The condos within are being snatched up by billionaire foreigners who use them as investments. They don’t even live there. Fifty-Seventh Street is now referred to as “Billionaires’ Row.”

The developer of One57, Gary Barnett, an Orthodox Jew, is building skyscrapers all over Manhattan, including the glass-and-metal Nordstrom Tower, which will be topped with a spire and rise up 1,775 feet. Except for 1 World Trade Center, it will be the city’s tallest building. So in the race between male developers to build Manhattan’s tallest skyscraper, Barnett is competing not just with other men, but with himself. Nordstrom Tower, to use the language of the real estate media, will “dominate” Manhattan’s skyline. Dominate, indeed: No other verb could so accurately convey the impact of Gary Barnett’s skyscrapers on New York.

It is not just Barnett who is devouring 57th Street. On the other side of Grandpa Abe’s building, another developer is putting up yet another glass-and-steel high rise. We are one of an ever-shrinking number of holdouts. Every so often, my husband and I get a call from Barnett, asking us if we want to sell our building. We keep telling him no. Once he told my husband that he just couldn’t take no for an answer.

No doubt Barnett, if he got our building, would tear it down. Where, then, would all the small businesses that now occupy it relocate to, in a city where office rents keep rising?

We are not selling.

I have a photo portrait taken of my grandfather at my mother’s wedding in 1944, two years before he died. He is wearing a dark suit and a fedora, and he is glowing with happiness. I wish I had known him. Every day, I look at his picture, and I wonder what he would think about his granddaughter as guardian over his properties.

This version includes some clarifications from the print version: Zucker’s estimate of the number of women in New York real estate and the relationship between Zucker and Goodstein Rossi.

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Alice Sparberg Alexiou, a contributing editor at Lilith, is the author of The Flatiron: the New York Landmark and the Incomparable City That Arose With It, and Jane Jacobs: Urban Visionary. She is currently working on a book about the Bowery.

 

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