scaffolds, scaffolds everywhere

JANUARY 25-31, 2016 | PRICE $3.00

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VOL. XXXII, NO. 4 WWW.CRAINSNEWYORK.COM

NEW YORK BUSINESS

CRAINS

®

NEW

SPAP

ERMorgan Stanley to leave Brooklyn P.7 | Outsourcing ... to the Bronx P. 8 | THE LIST: New York’s largest hotels P. 11

EVERYWHEREEVERYWHERESCAFFOLDSSCAFFOLDS

SCAFFOLDS,

A record 190 miles worth to be exact, or enough to wrap

around Manhattan six times.The law that turned

city sidewalks into an obstacle course PAGE 13

20160125-NEWS--0001-NAT-CCI-CN_-- 1/22/2016 7:07 PM

THE RULE THAT HISTORY in New York City marches upward,

not onward, as the skyline attests, has its exception on

Gansevoort Street.

There, in 1937, the owner of 52-58 Gansevoort

dismantled the upper floors of a tenement to create a

structure that was less expensive to maintain and better

suited to selling produce and, later, meat. Its next-door

neighbor did the same in 1940.

When the Landmarks Preser-

vation Commission created the Gansevoort Market

Historic District in 2003, it cited those otherwise un-

remarkable, low-slung market buildings as a defining

characteristic of the meatpacking district.

Now, two developers are asking the commission for

permission to redevelop that block. They make the unusual

argument that their plan will preserve that part of the

block’s history that was lopped off after the Depression hit New York’s economy.

Aurora Capital Associates and William Gottlieb Real Estate want to take the block

back—way back—to when the Gansevoort Market was an open-air lot filled with

wagons converging to sell wares. Their rationale challenges the very notion of what

it means to preserve the city’s history.

“We took a look at the full sweep of history,” said Harry Kendall, a partner at

BKSK, the architecture shop hired by the developer. The firm has a track record of

renovating buildings, like 25 Bond St. in NoHo, with natural materials that hardly

feel out of place in the context of that neighborhood.

From the vocal opposition, you’d think the developers were proposing a

supertower. In fact, Aurora plans to renovate two of the historically significant

buildings cited in Landmarks’ designation without altering their height, while

developing three of the two-story buildings on the block into what they were

originally: four-, five- and six-story edifices.

Community preservationists accuse the developers of cherry-picking history for

profit. It is a fair accusation, but not one that should be counted against them.

The stronger case is that the area was landmarked to preserve the

neighborhood’s commercial history. “It’s the only block in the meatpacking

district that consists entirely of meatpacking buildings,” said activist Andrew

Berman. The developers, meanwhile, say they are remedying the architectural

dismemberment that took place 75 years ago (also in the name of profit).

My guess is that the commission will ultimately come to some compromise.

Aurora should be credited with thinking about how to march history upward in

an aesthetically sensitive way that respects the past. “We consider ourselves

artisans of real estate,” said Aurora’s Jared Epstein. I wish more developers did.

JANUARY 25-31, 2016

FROM THE NEWSROOM | JEREMY SMERD

Fight of historic proportions

It’s the only block in

the meatpacking

district that consists

entirely of meatpacking

buildings

“

DIGITAL DISPATCHES

READ For the eighth consecutive year, New

York has the nation’s highest combined state

and local tax burden. While the conservative

Tax Foundation’s work is controversial at

times, its annual ranking is accepted as

the best measure of taxes that states and

municipalities levy.

■ Former Mayor Rudy Giuliani is

joining international law firm Greenberg

Traurig as chair of its cybersecurity and

crisis-management practice. He will be

leaving Bracewell & Giuliani, for which he

helped open a New York office. The law firm

will drop his moniker.

LISTEN to a podcast on our scaffold story,

changes that may be coming to your local

pharmacy and how this week’s Photo Finish

came about. Music by the Brain Cloud.

CrainsNewYork.com/podcast

Go to CrainsNewYork.com

IN THIS ISSUE

Wealthy

residents band

together to stop

supertowers for

the even-

wealthier.

FROM THE REBNY GALASCHMOOZEFEST

DDeeppuuttyy MMaayyoorr AAlliicciiaa GGlleenn and Bill

Rudin (pictured) hobnobbed with

real estate and industry

executives at the 120th annual

event hosted by one of the city’s

most powerful trade groups.

Check out photos from the

event at CrainsNewYork

.com/photos, and interviews

with city officials and industry

hotshots at

CrainsNewYork.com/video.

CRAINS

PHOTO: BUCK ENNIS

ON THE COVER

>

BU

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EN

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JANUARY 25, 2016 | CRAIN’S NEW YORK BUSINESS | 3

Vol. XXXII, No. 4, January 25, 2016—Crain’s New York Business (ISSN 8756-789X) is published weekly, except for double issues

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©Entire contents copyright 2016 by Crain Communications Inc. All rights reserved.

CORRECTIONS

HULU WILL NOT be streaming the Judd Apatow series Love.This information was misstated in the Jan. 18 Asked &Answered.

W 78-79 is the landlord of 2200 Broadway and was repre-sented by ROBERT KEMPNER and MARK TERGESEN of ABSPartners Real Estate in a leasing deal with Coco-Mat. Thisinformation was misstated in the Jan. 18 For the Record.

DEREK HUTCHISON’s age is 37. This was misstated in theJan. 18 Executive Moves.

Because of a production error, GOV. ANDREW CUOMO’s fullname was omitted at the start of Jan. 18’s “Cuomo’s budgetdiscipline suddenly comes at New York City’s expense.”

4 AGENDA

5 IN CASE YOU MISSED IT

6 ASKED & ANSWERED

7 REAL ESTATE

8 SPOTLIGHT

9 HEALTH CARE

10 VIEWPOINTS

11 THE LIST

FEATURES

13 SCAFFOLD CITY

21 GOTHAM GIGS

23 PHOTO FINISH

P.8 Keith Klain

20160125-NEWS--0003-NAT-CCI-CN_-- 1/22/2016 7:06 PM Page 1

No drama in de Blasio’s budget?At $82 billion, there should be

In proposing an $82 billion budget for the city’s next fiscal year,

Mayor Bill de Blasio called the plan “boring … and it’s a good

boring.” Growing tax revenue minimizes pain in the budget,

but there is more drama than the mayor lets on.

Start with the nearly $1 billion cut in state aid to the city proposed

by Gov. Andrew Cuomo eight days earlier: The mayor’s budget simply

ignores it. De Blasio explained, “I am taking the governor at his word”

that the city will be spared.

Yet that’s not quite what Cuomo meant when he told NY1, “At the

end of the day what you’ll see is it won’t cost New York City a penny.

But we will make joint streamlining, policy-efficiency changes.”

The Assembly might well block Cuomo’s cuts, but the governor was

saying the city could eliminate fat in Medicaid and City University

spending to offset the lost state aid. This is a challenge that de Blasio

should accept. Most CUNY employees could regale the mayor with

tales of waste and inefficiency—from

healthy workers taking sick days

(because they have accrued the max-

imum number they can cash out

upon leaving the system) to profes-

sors who rarely teach. Perhaps the

governor can shake things up.

Even the City Council—which

traditionally pushes mayors to increase spending—is pressing de

Blasio to look for savings in his agencies. The financial plan he

released last week does little of that, although the mayor said he

would consider the idea during the next five months of budget nego-

tiations. Anyone who deals with city agencies knows employees who

shuffle about at a snail’s pace or are bogged down by paperwork for

lack of technology. De Blasio should be relentlessly pushing for

improvement. City government is not a place for busywork or

sinecures.

The mayor denies any lack of

urgency, pointing to “all the things

we’re doing for fiscal discipline” (he

would cut summer afterschool pro-

grams, for example) to avoid increasing

property taxes. But get ready: His budg-

et says property-tax revenue will rise

next fiscal year by more than $1.3 billion, or 5.8%. That the increase

comes from higher assessments rather than rate hikes is little conso-

lation to most property owners, and it is disingenuous for de Blasio to

say, as he did last week, “We are not raising property taxes.” When

pressed, he admitted many New Yorkers would be paying more. In

fact, rate increase or not, they do so virtually every year.

FINE PRINT The mayor’s budget calls for the number of city correction officers to rise by 542 to 10,195, surpassing Rikers Island’s daily population of roughly 9,900 inmates. The spending plan also adds more than

$40 million to the Department of Correction’s $2.4 billion budget, to combat violence at the notorious jail.

I impressed upon himseveral times that 38million cattle go to thefood industry. It’s niceif one lives once in awhile.”— Animal activist Mike Stura after per-suading a Queens slaughterhouse ownerto give him a cow that escaped androamed the streets for an hour last week

25 WORDS OR LESS

“

GE

TT

YIM

AG

ES

4 | CRAIN’S NEW YORK BUSINESS | JANUARY 25, 2016

The mayor declared that he is “taking

the governor at his word” that the city

would be spared from cuts. But that’s

not quite what Cuomo said

ADDICTED TO NUMBERS? GET A DAILY DOSE AT @STATSANDTHECITY

BY GERALD SCHIFMAN

SOURCES NYC mayor’s office, Charles

Komanoff, The New York Times

ST

AT

SA

ND

TH

E C

ITY

NO TAX HIKE,the mayor

said. But

property tax

revenue is

budgeted to

rise by 5.8%.

GRIDLOCK SHOCKCITY HALL RELEASED a $2-million study earlier this month absolving Uber of blame forworsening Manhattan traffic. Previous research, including a July 2015 analysis bytransportation economist Charles Komanoff, tells the opposite story.

AGENDAWHAT’S NEW JANUARY 25, 2016

8.5% Reduction in average vehicle speed, to

8.5 mph, in Manhattan’s central business

district from 2012 to 2014

$14.7B Annual economic

cost of NYC’s

traffic delays

Number of additional daily

rides coming from Uber

cars south of 59th Street,

on top of the 44,500 Uber rides that replaced

yellow cab trips, on average, since 2013

52,400

CONGESTION’S CAUSES, ACCORDING TO KOMANOFF

40%

Increased bicycle lanes

19%

19%

5%

5%

11%

1%

Uber

Cheaper gas

Speed limit reduction

More pedestrians

Saferdriving

Unknown factors

Influence on slowed traffic


De Blasio’s budgetMayor Bill de Blasio’s $82.1 billionbudget ignores the more than $600million that Gov. Andrew Cuomo’sown budget would cut in statefunding for Medicaid and CityUniversity. The mayor’s budgetinstead focuses on what he called“the core mission of fightinginequality and creating opportuni-ty.” He will inject $337 million intothe city’s cash-strapped publichospital system, and add more than$600 million to the city’s pension-funds allocation. De Blasio said thatthe increased spending would notboost property taxes, but he wasreferring to rates, not revenues.(See Page 4.)

Litigator turned Wall St. cop All eyes will be on the new sheriff intown. Gov. Andrew Cuomo has nomi-nated Maria Vullo to succeed BenjaminLawsky as superintendent of the stateDepartment of Financial Services.Banks and insurers will be watching tosee if Vullo continues Lawsky’s policyof keeping a tight rein on their indus-try. She takes the post amid criticismthat the agency didn’t do enough tokeep insurer Health Republic afloat.

Apple cutsApple announced it will cut 49 jobsfrom its Fifth Avenue office starting inApril, as it shuts down its iAd business,which sells ads inside iPhone apps.

Onion sold This is not a joke: Spanish-language

broadcaster Univision is buying theparent of satirical website the Onion,which has more than 25 millionmonthly visitors, for an undisclosedamount of money. Univision wants toexpand its digital footprint and reachyounger audiences.

Finally, WTC transit hub to openAfter more than a decade of delays andcost overruns, the Santiago Calatrava-designed transit hub at the WorldTrade Center is scheduled to open thefirst week of March. The $3.9 billionfacility will link 11 subway lines andthe PATH trains to New Jersey.

Ziegfeld 2.0In a sign of how tough the movie-theater business is, the ZiegfeldTheater will play its final feature film inthe coming weeks, ending a 50-yearrun. The single-screen movie housewill reopen as a 10,000-square-foot,column-free ballroom for corporateevents and galas in 2017.

Knicks top listThe New York Knicks are the NBA’smost valuable franchise, according to

Forbes’ annual ranking. A new cabledeal and a league-leading $90 millionin premium-seating revenue helpedthe Knicks edge out the Los AngelesLakers, valued at $2.7 billion.

Koch’s museum post is historyDavid Koch, 75, left the board of theAmerican Museum of Natural Historyafter 23 years. Koch, who has beencriticized by environmentalists andclimate scientists, has donated morethan $23 million to the museum andsits on about 20 boards.

Weak IPO market makes

NYC startups look strong

NEW YORK HAS long looked on with awe at the

spectacular valuations given to venture-backed

startups in Silicon Valley: $62 billion for Uber, $25

billion for Airbnb, $10 billion for Dropbox. Though New York is

now No. 2 in venture-capital investment, it has a mere 15

“unicorns”—companies valued at more than $1 billion—to

the Bay Area’s 58, according to Pitchbook.

But that may be a good thing. Those megabillion-dollar

startups are too expensive for anyone to buy, and the tech

IPO market is dead: On average, the 85 venture-backed

companies that went public in 2015 are now trading 23%

below the prices at their IPOs, according to Renaissance Capital. Highly valued companies burning through

their cash may have to take on new funding at worse terms—or go public for a lot less than their private valu-

ation, as San Francisco-based Square recently did.

“Many of these companies have been trying to sustain their private valuations, but they’re disconnected

from the public market values,” said Kathleen Smith, a principal at Renaissance Capital.

New York’s unicorns and near-unicorns have suffered, too: Gilt just sold for a quarter of its one-time bil-

lion-dollar value, and Foursquare halved its valuation for its latest round. WeWork, valued at $10 billion and led

by founder Adam Neumann (pictured), could be a risky bet. But for the most part, the numbers for New York com-

panies don’t seem far-fetched.

“These smaller companies have had more realistic valuations placed on them,” said Pitchbook ana-

lyst Nizar Tarhuni. “They can still get attractive funding packages from VCs who are looking for

quality companies.”

AGENDA ICYMI

DATA POINT

AN ESTIMATED 58.3 MILLION

PEOPLE VISITED NEW YORK CITY

LAST YEAR, A RECORD. SOME

46 MILLION CAME FROM OTHER

PARTS OF THE U.S.

Horse-carriage deal draws ireUnder the proposed deal, which

requires City Council approval, the

number of horses would be cut to

95 from 180, and the horses

would be housed in a new stable

inside Central Park, while pedicabs

would be banned from operating in

the park south of 85th Street.

Pedicab operators claim the

restriction would put them out of

business, and carriage drivers

have threatened to sue the city.


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CRAIN COMMUNICATIONS INC.

BOARD OF DIRECTORS

chairman Keith E. Crain

president Rance Crain

treasurer Mary Kay Crain, Cindi Crainexecutive vp, operations William Morrow

executive vp, director of strategic

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executive vp, director of corporate

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senior vp, group publisher David Klein

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founder G.D. Crain Jr. [1885-1973]

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BU

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– MATTHEW FLAMM


What type of development does the city need?Mixed-income. But land is so expensive in the hot areas: thewaterfronts of Brooklyn and Queens; and Manhattan is almostuntouchable. You can build in the boroughs where you havetransportation, but you need zoning [to allow denser housing]. Themayor is trying to introduce that, and he is getting a lot of pushback.But it is a logical solution. It has to be done. It’s more difficult toextend the transportation network than it is to build housing.

Why do you do mixed-income?BRP is a mission-driven organization. Obviously we are a for-profitfirm, but we like building affordable housing, in some instances wherewe don’t even have to, because that is part of our DNA. We believe inan inclusive society. And in that society everybody doesn’t have tohave the same income, but they should have equity in terms of livingin safe neighborhoods and in healthy buildings.

Is it getting harder to find sites? In some cases people are asking about twice as much as they should[for land]. We are looking in northern Manhattan, Queens, centralBrooklyn and the South Bronx.

And what sort of stuff are you looking to build in these neighborhoods? We like mixed-income with retail that is a 10- to 15-minute walk to thetrain station. That’s our formula.

What do you think of the mayor’s plan to build on NYC Housing Authorityland?We are in favor of the NextGen NYCHA plan, the zoning plan andmandatory inclusionary housing. I think the administration ismoving in the right direction, but as a developer and someone inthe weeds, we would want higher density. But we realize themayor will probably have to settle.

Why did you create a general-contracting arm of the company? In the heady days of 2006, we had about $20 million worth ofconstruction on two projects. We couldn’t find a contractor. Wehad to beg companies to take the job, so we said we’d never dothat again. We actually almost missed the market because wehad to wait so long just to find a contractor. Now folks call us.

BRP is a minority-owned business. Could the government be doing more toencourage similar firms to get started? I think there are some fundamental challenges. First of all, you haveto be certified, but there are limits. For the state, if your net worth is$3 million [or more], you can’t be a certified minority-owned businessenterprise. In our business, how do you become a big guy if you can’tgrow to that level? So there are probably more qualified [minority-and women-owned businesses] that aren’t certified. The system isflawed for that reason, but both sides—the businesses and theagencies that oversee certification—could do a better job. �

We are a for-profit

firm, but we like

building affordable

housing, in some

instances where

we don’t even

have to

Meredith Marshall co-founded BRP Development in1998, initially helping run the business out of theapartment he shared with his wife beforegraduating to a storefront office in Fort Greene,

Brooklyn. Now, with 3 million square feet in the pipeline, BRP is oneof the city’s go-to developers for affordable and mixed-incomeprojects.The firm recently won a bid to redevelop the Flatbush CatonMarket in Brooklyn into a residential and commercial project, and isbuilding a $300 million mixed-use complex in downtown Jamaica,Queens, in partnership with the Greater Jamaica Development Corp.

MEREDITH MARSHALL INTERVIEW BY JOE ANUTA

AGENDA ASKED & ANSWERED REAL ESTATE

“


DOSSIERNAME Meredith Marshall

WHO HE IS Managing partner

and co-founder, BRP

Development

AGE 50

BORN Brooklyn

RESIDES Alpine, N.J.

EDUCATION Boston

University, B.S. in electrical

engineering; Columbia

University, M.B.A.

STARTING YOUNG Marshall

split a duplex apartment near Fort

Greene, Brooklyn, with his eventual

business partner Geoff Flournoy for

$1,200 in the 1990s. Then they

bought the entire building and

years later sold it for more than

seven times the purchase price.

AFFORDABLE HOUSING

Marshall believes there is a

common misconception that

developers can’t get a market-rate

return on affordable housing. By

varying the types of incomes that

would match up with apartments,

developers can use pricier

apartments to subsidize lower rents

in others. Private and public

pension funds would line up to

finance such low-risk investments.

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Our thanks to Ryan Alexander, Michael Geoghegan, Harly Stevens, Robert Stillman and J. Paul Stimpfle at CBRE for this 132,400 SF transaction.

Tom Bow [email protected] 212.257.6610Rocco Romeo [email protected] 212.257.6630Ashlea Aaron [email protected] 212.257.6590

Additional Leasing Opportunities Available. Please contact:

Welcomes ING Financial Holding Corporation to 1133 Avenue of the Americas

Morgan Stanley, whosearrival in 1988 gavedowntown Brooklyn asorely needed boost, is

now plotting its exit. But rather thanmove jobs to Bangalore, Salt LakeCity or other low-cost locales wherebanks have sent jobs in recent years,Morgan Stanley plans to relocatestaff to Manhattan, according topeople familiar with the matter. Thebank wouldn’t comment on howmany jobs would cross the EastRiver, but several hundred peopleare now employed in the Brooklynoffice.

The move could begin soonbecause the Brooklyn office leasesstart to expire this year, and relo-cating people to cheaper real estateis a top priority for the bank, whichis looking to lop $1 billion off itscosts in fewer than two years. “Toomany employees [are] based inhigh-cost centers doing work thatcan sensibly be done in lower-costcenters,” Chief Executive JamesGorman said on a conference calllast week.

Manhattan is no one’s idea of a

less-expensive workplace, ofcourse, but it’s where MorganStanley has been funneling staffersfrom the surrounding area for sev-eral years. Employees were trans-ferred from Brooklyn and JerseyCity into lower Manhattan after thefirm in 2012 agreed to lease 40%

more space in One New York Plaza.It’s not clear how much MorganStanley pays landlord BrookfieldOffice Properties for its 1.2 millionsquare feet in that building near theStaten Island Ferry terminal, butthe lease doesn’t expire until 2029.Brooklyn employees could also be

moved into thefirm’s headquartersin Times Square.

Morgan Stanleyplayed a key role inBrooklyn’s businessrevival when in 1988it moved its com-puter center intoPierrepont Plaza, anewly constructedhigh-rise built by anu p - a n d - c o m i n gdeveloper namedBruce Ratner. Atthe time, the firm’srent was a bit more than $20 persquare foot, according to pressreports. Today, average askingrents for downtown Brooklynoffice space are $52 per square foot,according to Newmark GrubbKnight Frank.

Morgan Stanley has been gradu-ally retreating from Brooklyn forseveral years. It rented nearly670,000 square feet of space in theborough five years ago but now hasabout half that amount.

Carlo Scisurra, president of the

Brooklyn Chamber of Commerce,said it would be unfortunate to losethe Morgan Stanley jobs. That said,he expects that any vacant spacewould be quickly filled. PierrepontPlaza tenants include HillaryClinton’s presidential campaign.

“I’ve got a list of companiesdying to be here,” Scisurra said.“It’s hard for me to understandwhy Morgan Stanley would leave,given the strength of Brooklyn’sbrand. They’re making a seriousmistake.” �

ELECTED OFFICIALS and a Manhattan neighborhoodgroup submitted a plan last week to cap the heightof new apartment towers in Sutton Place at rough-ly 25 stories, aiming to stop a nearly 900-foot-tallluxury tower proposed for the neighborhood.

The East River Fifties Alliance’s proposal, whichwould alter the Manhattan neighborhood’s zoning,was signed by three elected city officials who couldend up voting on it. The proposal would impose aheight cap of 260 feet east of First Avenue betweenEast 52nd and East 59th streets. It is designed to pre-vent the construction of supertall condo towers—buildings topping 1,000 feet—which have croppedup along West 57th Street, an area known asBillionaire’s Row.

“Billionaire’s Row keeps growing, and we aredrawing the line at a residential neighborhood,” saidCity Councilman Benjamin Kallos, who representsthe neighborhood and backs the change, which wasdelivered to the Department of City Planning.

The rezoning effort was galvanized by a pro-posal from developer Joseph Beninati’s BauhouseGroup to erect a 900-foot-tall luxury condo toweron East 58th Street. Beninati is currently tearingdown existing buildings on the site but has not yetsecured financing to start construction. ABauhouse spokeswoman said any effort to blockthe tower would be futile.

“Our project will be nearing completion by thetime any rezoning would be heard,” she said in astatement. �

For Morgan Stanley, it’sgoodbye BrooklynAs a lease expires, back-office staff is moving to Manhattan, for now

REAL ESTATEAGENDA

BY AARON ELSTEIN

Community looksto stop supertowerSeeks 260-foot height cap BY JOE ANUTA

BL

OO

MB

ER

G


It’s hard for me to

understand why Morgan

Stanley would leave,

given the strength of

Brooklyn’s brand.

They’re making a

serious mistake ”

JAMES GORMANtold investors

last week that

the company

would look to

leave high-cost

centers.

“


Doran Jones co-CEO Keith Klain began forming visions of creat-ing an outsourcing powerhouse on the banks of the HarlemRiver as he flew from New York City to places like India, EasternEurope and Singapore to visit offshore software consulting

company vendors. Why travel halfway around the world, he wondered,when you can set up a facility a mere seven miles from midtown, wheremany of the company’s financial-services clients’ offices are?

And so Doran Jones—named after co-founders Glenn Jones (who hassince left the firm) and current co-CEO Matt Doran—set up its technologyhub in a warehouse on East 138th Street. From this location, directly acrossthe East River from Rikers Island, Doran Jones is reimagining the idea of off-shore staffing by running a profitable business using local employees.

“We want to be the onshore outsourcing alternative to India,” says Klain.In September, Doran Jones opened its 15,000-square-foot IT facility in

partnership with Per Scholas Inc., a national nonprofit that teaches techskills to people in economically disadvantaged neighborhoods. The officehas the feel of a tech startup: open-plan seating, TVs for webcasting,whiteboards and a Playstation in the break room.

The company has 53 employees now working to develop and test cus-tom risk-management and claims-adjustment systems for Fortune 100financial and insurance companies. Approximately 80% of Doran Jones’staff came from its training program with Per Scholas, and the companycurrently hires about a third of the program’s graduates.

Twenty minutes from Grand Central “Executives in the testing space spend a lot of their time on planes

going to India or Eastern Europe,” said Doran, who leads the team’s salesefforts and previously worked in the structured-finance group at FitchRatings. “The sheer convenience of being 20 minutes from Grand CentralTerminal is something these guys love.”

Still, selling investors on the idea of an IT center in the Bronx wasn’teasy. Despite being on the edge of Manhattan, the South Bronx is a worldaway from the financial capital of the universe.

“We spent a lot of time asking for money and not a lot of people wereopen to the risk profile of doing this in the Bronx,” said Klain.

So Doran Jones got creative. It went to private philanthropic fundersand asked them to give grants to Per Scholas, which used the money toconstruct the facility. Doran Jones is leasing the space from Per Scholasand sharing 25% of the unit’s profits with them.

“This is a huge paradigm shift for the nonprofit world,” Klain said.By keeping its investment costs relatively low and maintaining company

ownership, Doran Jones provides a cost-competitive alternative to offshorefirms. It previously provided its services on-site at clients’ offices.

Sales figures show onshore staffing can work. Doran Jones had rev-enue of $3.5 million in 2014 and $5.5 million in 2015, and projects $10.2million this year.

Klain, who has 29 years of IT experience working for large banks, said thelevel of education is what separates his employees from those outside theU.S. “In the traditional software testing in India, the attrition rate is high andthe quality is low,” he said. “We focus on software testing as a real career andskill set.” Half of the Per Scholas hires have college degrees, he says.

All new Doran Jones staff members complete a 15-week technologytraining program taught by Per Scholas. Then they tackle an eight-weeksoftware testing program led by Doran Jones. “We give them a job or, ifwe don’t have a job, we help them find one in the open market,” saidKlain. “That is part of the partnership.”

“Doran Jones is a classic India alternative,” says Allie Young, a technologyanalyst at Gartner. Young looks at four elements to measure an onshore com-pany’s success, and Doran Jones has them all: a competitive labor market;proximity to clients; a clear, niche focus; and an education pipeline. “It is wellpositioned,” says Young. “Its growth suggests they are scaling effectively.”

Doran Jones has signed nondisclosure agreements with its clients, butsays it is bullish on its prospects. The company is looking to grow to 150employees by midyear, and to 450 workers by late 2016.

“The Bronx is shedding the old stereotypes,” said Borough PresidentRuben Diaz Jr. “We still have work to do, but crime is down, jobs are up andwe are on the rise.” �

SPOTLIGHT SMALL BUSINESS

The Bronx takes on Mumbaifor IT outsourcing Doran Jones builds a software testing empire in Port Morris, using localworkers and a totally new approach to raising capital

LLOOCCAATTIIOONN 804 E. 138th St., Bronx

FFOOUUNNDDEERRSS Matt Doran and Glenn Jones

GGOOAALL The company is looking to fill its current facility with employees, including

adding 300 more workers during the next two years. Doran Jones is also exploring

adding a second location in another city.

BBOOTTTTOOMM LLIINNEE

Employees: 53

2014 revenue: $3.5 million

2015 revenue: $5.5 million

2016 forecast: $10.2 million

FOCAL POINTS

KEEPING IT CLOSE:Keith Klain is

bringing tech

outsourcing closer

to his Manhattan

customers by

creating jobs in the

Bronx.

AGENDAB

UC

KE

NN

IS


BY MATT MCCUE


years have relied on the legislatureto beat back proposals from thegovernor that would cut Medicaidcosts at their expense. AssemblySpeaker Carl Heastie, who receivesregular contributions from pharma-cy groups, sponsored legislationpassed in 2011 that made it illegalfor health plans to require theirmembers to use mail-order phar-macies or to charge co-pays forusing brick-and-mortar pharma-cies. Insurers argued that the mail-order option would save moneythat would translate to lower pre-

miums for consumers.When it comes to lifesaving spe-

cialty drugs, the most importantthing is to ensure they’re widelyavailable, according to a spokesmanfor the Gay Men’s Health Crisis, anHIV/AIDS advocacy organization inNew York City. “Given the commit-ment to ending the epidemic inNew York state by 2020, we arehopeful that as the budget negotia-tions continue that the final budgetwill remove barriers like reducedreimbursements for specialtydrugs,” the spokesman said. �

A plan by Gov. AndrewCuomo to save the statemoney on high-cost specialty drugs has local

pharmacies pushing back, sayingthey could be forced to discontinuecarrying those medicines.

The drugs are used to treat com-plex conditions such as cancer andHIV, and retail at an average of$53,000 for a year’s treatment,according to the AARP PolicyInstitute. Local pharmacies see theplan as a lose-lose scenario: losemoney on the drugs becauseMedicaid’s proposed reimburse-ment does not cover their costs; orstop carrying the medicine and risklosing customers who would goelsewhere to fill their prescriptions.

“If pharmacies aren’t going to beable to afford to fill these prescrip-tions, it creates patient-accessissues,” said Mike Duteau, presi-dent of the Chain PharmacyAssociation of New York State, alobbying group that representscommunity drugstores.

In some cases, pharmacies arepaid hundreds of dollars below costfor specialty drugs by Medicaid

managed-care plans, and have lim-ited ability to negotiate rates,Duteau said.

The governor, who introducedthe measure as part of his $145.3billion budget, has taken aim atspecialty pharmacy costs as part ofhis focus on bringing downMedicaid spending, which theadministration said fell to a 13-yearlow of $8,223 per enrollee in 2014.(Medicaid spending has nonethe-less increased to $63.3 billionbecause more New Yorkers, 6.3million, are covered by it.)

A major part of Medicaid reformhas centered on better coordinatingpatients’ health through managed-care plans, which typically reim-burse pharmacies at lower rates forthe drugs they dispense. Now,Cuomo wants pharmacies to bereimbursed at those lower rates forall Medicaid members.

The state is not alone in trying toaddress the rising cost of specialtydrugs, which in 2012 accounted forjust 2% of drug utilization but 28%of drug spending, according to theKaiser Family Foundation.

Local pharmacists in recent

Pharmacies decry proposedcuts to specialty-drug careMedicaid patients with cancer, HIV could be affected

HEALTH CAREAGENDA

BY CAROLINE LEWIS

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New York Pres-byterian Hospitalhas received a $75million gift from

the Steven & AlexandraCohen Foundation to create aunit to care for newborns.

The Alexandra & StevenCohen Hospital for Womenand Newborns will occupysix floors and 246,500square feet in the DavidKoch Center, a plannedambulatory-care facility onthe Upper East Side. It willbe part of New York-Presbyterian’s Weill Cornellcampus. The hospital will have75 private rooms and well-baby bassinets, 60 privateneonatal intensive care unitbassinets, 16 labor and deliv-ery rooms, five C-sectionsuites, five post-acute carebays and 14 ultrasound rooms.It is scheduled to open inDecember 2020.

The Cohens have also beenprodigious benefactors toother area hospitals. In 2005,they donated $50 million

toward a pediatric emergencyroom at NYP’s Morgan StanleyChildren’s Hospital in Wash-ington Heights. NorthwellHealth, the 21-hospital LongIsland system, renamed itsown children’s hospital inNew Hyde Park after theCohen family, following a $50million pledge made in March2010.

Steven Cohen is thefounder of hedge fund SACCapital Advisors, now Point72Asset Management. Earlierthis month, Cohen settledcharges from the U.S.Securities and ExchangeCommission alleging he failedto supervise an SAC hedge-fund manager convicted ofinsider trading. Forbes esti-mates Cohen’s net worth is $12billion.

Epilepsy drug test beginsFive New York hospitals wereapproved to conduct clinicalstudies on a cannabis-basedepilepsy drug called Epi-diolex, the state Department

of Health announced lastweek. Patients between theages of 1 and 21 who sufferfrom treatment-resistantepilepsy are eligible; 100 willbe chosen to participate.Epidiolex, manufactured byGW Pharmaceuticals, previ-ously was tested in a study atNYU Langone. Participatinginstitutions include Monte-fiore, Women & Children’sHospital of Buffalo, NYULangone, Mount Sinai Beth

Israel and University ofRochester Medical Center.

Genome research The New York Genome Centerin Manhattan received a four-year, $40 million commitmentfrom the National Institutes ofHealth’s National HumanGenome Research Institute fora genome-sequencing pro-gram that will study commondiseases, with autism as itsprimary focus. The funding

comes on the heels of a sepa-rate $100 million challengegrant made by the SimonsFoundation ($80 million) andthe Carson Family CharitableTrust ($20 million), charitiesthat are affiliated with twoNYGC board members.

City hospitals get bailoutMayor Bill de Blasio’s $82.1 bil-lion preliminary budgetincludes $11.6 billion for healthand welfare, most notably a$337 million infusion for NYCHealth + Hospitals, which lost$263.6 million in the first quar-ter of its fiscal year. The mayorsaid the public hospital systemis suffering because of federalcuts for uninsured care, butthat proposed Medicaid cutsfrom the state “won’t cost thecity a penny” because they willbe offset by efficiency gains.The budget also sets aside $5.4million to expand FDNYambulance tours in Manhattanand Queens and to fund initia-tives in the Bronx to improve response times. �

NY-Presby gets $75 million gift to improve care for newbornsBY JONATHAN LAMANTIA AND CAROLINE LEWIS

The gift to the hospital

came from the Steven

& Alexandra Cohen

Foundation.


AS NEW

YORK Metsa n n o u n c e rHowie Sternlikes to sayafter a win,“Put it in thebooks.’’ And2015 wascertainly a

win for New York City,according to last week’s stateLabor Department report.

● It’s a record.New York City added

100,500 jobs in 2015 (using theannual average of nonfarmemployment), the secondconsecutive year the city hasgenerated six-figure employ-ment gains, after 120,700 jobs

were added in 2014. This isimportant because it is thefirst time that has happenedsince reliable statistics beganbeing collected.

Halfway through the newmayor’s term, it is time to callthe expansion that began in2010 the “Bloomberg-deBlasio Boom.”

● Forget the idea that there is amanufacturing revival.

Last fall the Center for anUrban Future made a splashby reporting an uptick inmanufacturing jobs. Somemedia outlets continue to relyon that finding. Now weknow manufacturing declinedby 1,000 jobs—the only majorsector to lose ground.

The numbers to focus onare 103,200 (the job count adecade ago) and 74,400 (theDecember 2015 total). Fromhistory, it is easy to predictwhat will happen. This sectorwill lose a small number ofjobs each year as long as thenational economy remainsstrong, and then will plungeduring the next recession.

● Ignore all those bad-news head-lines on Wall Street.

In the last year, securitiesfirms added 8,300 positions—an impressive 5% increase. Itisn’t clear where those jobsare, but the best guess is thatthey are at hedge funds andprivate-equity firms, withsome additions to compliance

and legal depart-ments at the bigfirms. It is worthnoting that 2014 payrose sharply, anddespite mediareports to the con-trary, bonuses are like-ly to be better than expectedwhen we get the state comp-troller’s take next month.

● Leisure and hospitality just keepexpanding.

The great New York Citytourism boom produced13,000 new positions lastyear, bringing the total toabout 430,000. Most of thecredit goes to full-serviceeateries, but fast-foodemployment grew, too,

despite the looming mini-mum wage increase to$10.50 an hour.

The report released lastThursday is preliminary andwill be revised in March,when the department restatesall the numbers for 2014 and2015. At least a few local econ-omists expect those to berevised upward. �

GREG DAVID

AGENDA VIEWPOINTS

With record employment, let’s call it the Bloomberg-de Blasio boomThe city records consecutive six-figure job gains for the first time in history


GREG DAVID blogs regularly

at CrainsNewYork.com.

Pot shots and Penn Station

Kill or keep common core

The premise of “Wastedmoney, chaos predicted if NYrepeals Common Core”(CrainsNewYork.com) is ludi-crous. We should keep theseharmful standards because itwould be cheaper than tryingto replace them?

Perhaps the true waste wasthe billions spent trying toshove them down the throatsof educators and families.Now, the state has decidedthat tests associated withCommon Core won’t evencount toward teacher evalua-tions until 2020. And what dothese businesses care aboutother than the bottom line?They know nothing of how toeducate the whole child.DANIEL BARRESI

Centereach, N.Y.

THEY MAY CHANGE the nameand decrease testing, but thestandards of increasing mathand English skills are goingto remain. About 30%-40%of New York state studentsgraduating high school needto take remedial classeswhen they enter college.The ACT and SAT both areshowing large percentages

taking those tests are notready for college or theemployment market.

The kids who need reme-dial classes often fail to gradu-ate from college, or take six-plus years with too many stu-dent loans. They end upunderemployed and in fiscaldifficulty for a great part oftheir lives. Increasing mathand English skills is a starttoward reversing that trend.

Common Core has becomethe No. 1 conspiracy theoryamong the opt-out group.They blame the businessgroups, book companies, BillGates, President Obama oranything they can. It is sad tosee adults falling for silly con-spiracy theories. I guess this isthe new world we live in.

We did land on the moon,folks. We do need to improvemath and English skills for alarge number of our kids.JAMES HAYES

Love those tip-free restaurants

There are more than 20 tip-freerestaurants in New York City,so while Danny Meyer is start-ing a good conversation, he’sfar from alone (“New Yorkersstill love tipping, survey

shows,” CrainsNewYork.com).There are many reasons to

support this trend: In additionto reducing the server/cookwage gap, tipping is discrimi-natory (black and olderwomen servers earn less) andtied to sexual harassment andcorruption. I hope diners canbe open to the change.MAX GHENIS

Grow the weed business

I’m grateful to Crain’s reporterCaroline Lewis for staying onthe medical-marijuana story(“Inside a marijuana buyersclub,” Jan. 4). Politicians mustlose their fear and act to makeNew York’s entire cannabisindustry flourish.

There are thousands ofpeople across New York whocould be positively affected bythe swift expansion of thisoverly restrictive medical-cannabis program: manymore patients in need, ofcourse, but also thousands ofNew Yorkers who desire long-term, respectable careers inthe cannabis industry.

Also, the stalks and seedsof cannabis plants presentlimitless economic opportuni-ties for New York’s farmers

Readers also react to school tests and tip-free restaurants

CRAIN’S WELCOMES SUBMISSIONS to its opinion pages. Send letters to [email protected]. Send columns of 475 words or fewer to [email protected]. Pleaseinclude the writer’s name, company, address and telephone number.

and entrepreneurs, who canjoin forces to revitalize manu-facturing, medicine, nutritionand adult recreation all atonce. The only thing we haveto fear about cannabis is thefear of these plants itself!LAWRENCE GOODWIN

Replant the Garden in the Bronx

Crain’s editors are correct that“The long-awaited overhaulof awful Penn Station comes abit too soon”(Jan. 11).

Let’s startplanning nowfor 2023, thelast year of theCity Council’spermit exten-sion forMadisonSquare Garden.A new Garden should be builtnear Yankee Stadium, perhapsin place of underused garagesor by Metro-North’s YankeeStadium stop. HankSteinbrenner, with BronxBorough President RubenDiaz Jr., should lead a“Knicks, Rangers andYankees as Neighbors” campaign.

Getting to Yankee Stadiumis an easy ride on the subwayor Metro-North—an instant-camaraderie experience forfans. Plus, it’s time to take

advantage of the close-by,easy-walking-distance of theHarlem River. Imagine the funand the visual splendor ofarriving for a game by ferry.

For fans who drive, thearea has plenty of parking.

What is now known as theYankee Stadium area couldbecome a year-round SportsVillage USA. Restaurants,other establishments, condosand hotels further propellingthe already well-advanced

revivification ofthe SouthBronx wouldn’tbe far behind.Before long, thenext generationof young pro-fessionals willwant to livethere or nearby.

Lastly, somemayor will one day bring upthe idea of a bid for theSummer Olympics. The bidwill be a lot stronger if itincludes Sports Village USA. Itcould also, of course, containseveral pictures of the newPenn Station!MICHAEL J. GILL

Gill is a partner in theGillWright Group, a Bronx-based management consultingfirm, and was a founder andchairman of the South BronxOverall EconomicDevelopment Corp.

YEAR TOTAL CHANGE

2009 3,693.3 -135.5

2010 3,711.5 18.2

2011 3,798.5 87.0

2012 3,885.3 86.8

2013 3,981.5 96.2

2014 4,102.2 120.7

2015 4,202.7 100.5

SSoouurrccee:: NYS Department of Labor

NYC JOB TOTALS

In thousands

BU

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10 Wayside Road, Burlington, MA · 781 505 4130 · thecapitalgrille.com

Aged 21 days, then hand-carved by our

in-house butcher.NYC Chrysler · Wall Street · Time-Life

155 E 42nd St, The Chrysler Center · 212 953 2000120 Broadway, on Nassau at Pine Street · 212 374 1811120 W 51st Street, Time-Life Building · 212 246 0154

thecapitalgri l le.com

Is it a preposterous comparison? That we tend to our steaks with

the passion of a wine maker? Consider that before you are served

any steak at The Capital Grille, our master butcher has monitored it

daily for 21 days in a temperature- and humidity-controlled vault, then

carved it by hand. Does our obsession pay off ? You tell us.

IF YOU THINK WINE MAKERS AREOBSESSIVE ABOUT

CARE AND AGING,YOU HAVEN’T MET OUR BUTCHER.

THE LIST NEW YORK CITY’S LARGEST HOTELSAGENDA


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Scaffold CityHOW A LITTLE LAW MEANT TO PROTECT PEDESTRIANS CREATED A $1 BILLION INDUSTRY

AND CHANGED THE FACE OF NEW YORK

One day in 2004, workmen arrived at the corner of West123rd Street and Lenox Avenue in Harlem to erect asidewalk shed, one of those unsightly steel-and-wooden structures that pop up any time a building isunder construction. Twelve years later, it’s still there.

“It’s completely demoralizing,” said Laurent Delly,a real estate broker with a master’s degree in civil

engineering who lives down the street from the shed. Sidewalk sheds andthe scaffolding that usually sits atop them are intended to protect pedes-trians from falling bricks and debris. But the chief purpose of this partic-

ular shed, on a handsome block in the Mount Morris Park HistoricDistrict, seems to be to collect garbage and provide shelter to the loiter-ers who lurk underneath. Repairs at the building it surrounds move at aglacial pace.

Delly has complained over and over to the city, elected officials andbuilding inspectors, who have fined the owner for numerous violations.He contacted The New York Times, which wrote a feature on it two yearsago. Still, the shed remains.

“This is a beautiful block, and people here care about our streets,”Delly said. “Do you think this would be allowed to happen if we lived on



By Aaron Elstein

PHOTOGRAPHY BY BUCK ENNIS


the corner of Park Avenue and 72nd Street?”Plenty of New Yorkers can understand his

frustration. Across the city, sidewalk sheds andscaffolding spread like kudzu. They devourprecious sidewalk space, cut off sunlight, cre-ate safety hazards and hurt businesses. Thereare now nearly 9,000 sheds entombing citystreets, according to the Department ofBuildings, up from about 3,500 in 2003. That’s190 miles worth of sheds, or 1 million linearfeet—equal to the distance between GansevoortStreet in the West Village and thehamlet of Gansevoort in upstateSaratoga County.

“New York is insatiable rightnow when it comes to sheds,”said George Mihalko, a shed-equipment supplier who said hisbiggest challenge is findinginventory to fill the five 25-foot-long truckfuls of steel pipes andbeams that he sends out dailyfrom his North Bergen, N.J., ware-house. “I’ve never seen anything like it in 30years.”

The unprecedented demand is driven in partby the new wave of construction fueled by thecity’s robust economy. But there’s another,more important reason: Thirty-six years ago,the city passed a law requiring regular inspec-tions of older buildings to ensure concrete andbricks don’t fall on pedestrians. And sincethen, the City Council has strengthened the lawwhile adding new ones, giving rise to an indus-try that generates $1 billion a year—$200 mil-lion of that is for the street-level sheds, and therest pays for the scaffolding and the workerswho repair the façades.

One of the shed boom’s biggest winners isWilliam Laffey, a 36-year-old native ofBellerose, Queens, who, after graduating from

Albany’s Siena College in 2001, started outmanaging the tool inventory at a Home Depot.He is now president of Spring Scaffolding, aLong Island City-based firm that builds moresheds than anyone else, with 583 standingaround the city, according to BuildingsDepartment records. “I wouldn’t say this isrecession-proof, but someone always needsscaffolding,” Laffey said.

Of course, what some might call boom timesfor sheds would be described by others as an

epidemic. “Sheds are awful and everywhere,” lament-

ed Dan Biederman, president of the 34th StreetPartnership, a midtown business district wheresheds cover about 20% of the sidewalk space.

“So many things about the city haveimproved, yet sheds are the same gloomy thingthey’ve been for more than 40 years,” groanedStephen Varone, president of Rand Engineering& Architecture.

Even shed builders agree their works don’texactly please the eye. “Basic sidewalk shedsare built for safety, economy and functionality,not beauty,” said Ken Buettner, CEO of YorkScaffold Equipment Corp. in Long Island City.

Sheds themselves can be safety hazards. Lastyear, Mayor Bill de Blasio described sheds as“great for criminals as a place to hide” and

“great for folks who want to throw their trashon top.” On Jan. 8, his administrationannounced a “shed safety sweep” in whichinspectors will examine sheds to ensure they’rewell-lit and code-compliant. In 2007, a NewYork police officer chasing a suspect slammedinto a poorly lit shed at the corner of RiversideDrive and West 109th Street, and was injured.“I never saw the pole ... the light was—it wasblack, dark,” the officer later testified. Small-business owners complain that sheds obscuresigns and shop windows and drive potentialclients across the street. Last month, the UpperWest Side’s Ocean Grill shut down after a shedand construction noise drove away customers,according to a lawsuit the owners filed againsttheir landlord. BLT Fish in the Flatiron districtcalled a shed outside its restaurant a “kiss ofdeath” in a 2013 lawsuit against its landlordthat was settled a few months ago.

Residents loathe sheds because some nevergo away. The Mount Morris shed has lingereduptown longer than Wicked has played onBroadway. “The city assumes if you want a per-mit, there’s work to be done, and clearly thatisn’t always the case,” said Robert Rodriguez,an assemblyman from Harlem. Last summer,the de Blasio administration removed eightmiles of sheds from New York City HousingAuthority properties where no active work wastaking place, and last month, Gov. AndrewCuomo signed into law a bill that requires theHousing Authority to remove any remainingdormant sheds on its sites. Rodriguez, the bill’ssponsor, wants the legislation extended to pri-vate landlords.

Six years ago the building industry held acontest to create a nicer-looking shed. Thewinning entry was an attractive assemblage ofhigh-strength recycled steel, translucent plas-tic and LED lighting, called Urban Umbrella.But it flopped because it costs more than tradi-tional steel-and-wood sheds and is harder toassemble.

And so the dismal spread of sheds continues.“What’s supposed to be a temporary struc-

ture has become an architectural feature of thecity,” said Andres Cortes, UrbanUmbrella’s designer. “How do we getout of this?”

THE ANCIENT GREEK historianHerodotus described howEgyptians used scaffolding to

build pyramids, but the modern busi-ness dates to 1938. That’s when aMilwaukee contractor named ReinholdUecker patented the first scaffolding

system of steel beams and pipes, after thewooden structure he had used on a churchsteeple collapsed. Today, the scaffolding busi-ness nationally generates more than $10 billiona year in revenue, says Marty Coughlin, pastpresident of the Scaffold & Access IndustryAssociation, a national trade group.

In New York, the business is dominated byoutfits including York Scaffold, UnitedHoisting & Scaffolding, and Universal BuildersSupply, which not only install sheds but alsobuild scaffolding and construction elevatorsabove them. Universal, which helped erect theEmpire State Building in 1931, generated $75million in revenue last year, according to thetrade journal Engineering News-Record. Itsscaffolds once covered the Statue of Liberty, St.Patrick’s Cathedral and the Time Warner


AGING IN PLACE: Disgruntled Harlem

resident Laurent Delly wants this

12-year-old shed removed.

“SO MANY THINGS ABOUTTHE CITY HAVE IMPROVED, YETSHEDS ARE THE SAME GLOOMY

THING THEY’VE BEEN FOR MORETHAN 40 YEARS”

20160125-NEWS--0014,0015-NAT-CCI-CN_-- 1/22/2016 3:25 PM Page 1

Center on ColumbusCircle. “It’s not anexaggeration to saywe helped build a lotof the New Yorkskyline,” saidPresident KevinO’Callaghan, thethird generation torun the family busi-ness. His firm’s cen-tral role in the city’sreal estate sceneputs O’Callaghan inregular touch witheveryone from cor-porate CEOs to truckdrivers—“the wholegamut of society.”That said, he doubtshe will pass on thecompany to his chil-dren, one of whomworks at GoldmanSachs, another atDeutsche Bank and a

third at Yext, a Manhattan-based firm special-izing in digital-location management software.He’s proud of his kids, but adds, “They’re mov-ing paper.”

Starting in the early 1980s, O’Callaghan andother big scaffold builders started to see newcompetition. There’s a founding figure for thatstory, too. Her name is Grace Gold.

Gold was a graduate of Brooklyn’s JohnDewey High School who was fluent in Spanishand liked to sing and play guitar. She finishedhigh school early and was only 17 when shecompleted her freshman year at BarnardCollege on the Upper West Side. On May 16,1979, after attending the annual graduationceremony, she headed with some friends to getcash at a bank at the corner of Broadway andWest 115th Street. Then a piece of masonry felloff the building and struck her on the head.“Her friends watched her die on the street,”recalled her sister, Lori Gold.

A year later, the city enacted a law requiringowners of buildings higher than six stories toinspect their properties’ street-facing façadesevery five years. The law created a need foranyone skilled in replacing aging bricks orstonework. “Grace’s death catapulted whathad been a cottage business into an industry,”said Wayne Bellet, owner of BelletConstruction, a 70-employee firm that special-izes in renovating old buildings.

The statute, Local Law 10, was also a boon tothe shed industry because there were 13,000buildings around the city that needed inspectingand a shed had to be installed any time restora-tion work was deemed necessary. Hundreds ofstartups rushed in, including Spring Scaffoldingand Skyline Restoration, which merged in 2011.In 2013, Skyline was ranked by Crain’s as one the50 fastest-growing companies in the city, with$66 million in revenue. (That figure is now morethan $90 million, according to a person familiarwith the firm.)

Over time, the city broadened its inspectionlaws, usually in reaction to accidents. In 1998,Local Law 11 came into effect and requiredinspections of side and rear façades. In 2010,the city staggered deadlines for filing safetyreports to avoid mass sprints to the finish line,in the process creating a never-ending streamof work for shed builders. In 2013, after a 35-

year-old woman was killed when a balconyrailing collapsed, the city added railings to thechecklist.

“I’m sure it was never anyone’s intention tohave sheds pop up all over the place,” saidRand Engineering’s Varone, who started hisfirm in 1987 to help buildings comply withLocal Law 11. “But that’s how it worked out.”

Business grows constantly. Even the finan-cial crisis didn’t hurt, with Universal BuildersSupply’s revenue rising every year between2007 and 2013.

The emphasis on building safety has had ademonstrable impact. Complaints about fallingbricks or other debris decreased by more thanhalf from 2005 to 2015, according to cityrecords of 311 calls. “There’s no doubt in mymind that decline is due to the city’s laws,”said Eric Cowley, founder of CowleyEngineering, a firm that has renovated NewYork buildings since 1985.

The improvement also comes at considerablecost to building owners, with expenses ratch-eted up in part because cautious city officials

sometimes require a shed even when it isn’twarranted. One reason is constrained resources:The Department of Buildings’ 500 inspectorsmonitor thousands of construction sites, andharried officials sometimes order a shed to pro-tect pedestrians until they get time to visit thebuilding. Cowley said officials sometimesdemand sheds for minor projects that don’t evenneed permits, such as masonry-joint repair.

“The city has become a little overzealouswhen it comes to requiring sheds,” he said.

That probably wouldn’t be so bad if thestructures really were temporary. But oncethey go up, there’s no law saying private land-lords must take down dormant sheds, nor doesit always make financial sense to do so. Thelaws of shed economics explain why.

THE EVER-PRESENT SHED on Delly’s Harlemblock sprouted up about four monthsafter the four-story, eight-unit building

was acquired in 2004 by Muhammad Shahid.

190MILES OF SIDEWALK SHEDS

in the city, more than doublethe number a decade ago

$25KCOST TO ERECT a 200-foot-long shed

$200MANNUAL COST of building andmaintaining NYC’s sheds, notincluding scaffoldingSources: New York City Department ofBuildings, industry estimates

FACTS



�

�

�

�

�

�

THE CEILING is

made of beams and

corrugated steel

pitched so rainwater

rolls off, and is

topped with wooden

planks

THOSE MULTITUDINOUSCOLUMNS, by the way,

are called bridge legs

BRIDGE LEGS rest

on wooden squares

called mudsills

T-CLAMPS secure cross

braces to

bridge legs

HEAD CLAMPS secure I-beams

to columns

COLUMNS are

linked by

horizontal beams

called girts

DIAGONALPIPES are

called

cross

braces

AND DON’T FORGET! City rules also require a sign giving information about the

construction project and whom to call with complaints. The letters spelling this out

must use Calibri or a similar sans-serif font, be at least one inch high as measured

by the uppercase character, and be white on a background painted one of eight

shades of blue.

ANATOMY OF AN ANNOYANCE

�

20160125-NEWS--0014,0015-NAT-CCI-CN_-- 1/22/2016 3:26 PM Page 2

Shahid, who is listed in city records as presi-dent of a firm called Zamzam Realty, said theshed has stood for so long because the area’slandmark status has made it hard to get reno-vation plans approved. “I have no idea whenthe shed will come down,” he said.

Shahid may infuriate people who live nearhis property, but he’s one of many landlordswho have concluded it’s cheaper to keep up ashed—and pay fines for violations—than it is tofix a building.

Here’s the math: To erect a 200-foot-longshed costs around $25,000, half of which ispaid upfront and the rest when the shed istaken down. In between, the shed builderwould collect about $700 per month in rent.Suppose the building owner needed to replaceloose bricks and masonry, tighten the parapetand waterproof the roof. If the building werehigher than 15 stories, he would need to employa full-time site-safety inspector, install protec-tion over neighboring buildings, and put up ashed that extends 20 feet past the end of itsfaçade in each direction. The entire cost of therenovation project, including the shed andscaffolding? Easily $250,000, according toCowley. Even a prosperous building ownerwould probably flinch at that expense; the lesswealthy simply put up the shed and worryabout when it will come down some other day.

This could be remedied with legislation sim-ilar to the law requiring the Housing Authorityto take down its sheds. But City CouncilSpeaker Melissa Mark-Viverito wouldn’t com-ment on whether she would support such alaw, and the state couldn’t pass one withoutthe city giving its go-ahead.

Shed builders certainly would not welcomemore government oversight, in part becausetheir business is already heavily regulated.Nearly every aspect of a shed is determined bythe city government.

It starts with the city saying the structuresmust be strong enough to support 300 poundsper square foot—twice as much as demanded byany other city. That rule, which has been on thebooks since at least the 1960s, ensures struc-tures are strong enough to absorb the shock of abrick falling 20 stories, but it also means a col-umn is required every eight feet to support the

load. That helps explain why New York shedsgobble up so much sidewalk space.

Until 2013, sheds came in a variety of colors,including blue, silver and beige, which con-tractors used to identify their projects. ThenMayor Michael Bloomberg decided to put anend to that. “What we are looking for is a colorthat is, you know, what maybe psychologiststhink are soothing colors,” then-BuildingsCommissioner Robert LeMandri told the City

Council. “And so we chose green.”The edict was big news for Michael Schnurr,

president of National Paint Industries, theleading paint provider to the city’s biggestbuilders. His factory in North Brunswick, N.J.,got busy producing the exact type of paint cho-sen by the city, a blend that he calls HunterGreen 1390. Sales of the color immediatelyquadrupled, to more than 80,000 gallons peryear at $25 a can, and today it’s almost impos-sible to walk the streets without seeingSchnurr’s green paint. “Not bad for a kid whosedad started mixing paint in the back of his shopin Brooklyn in 1959,” he marveled.

The laundry list of rules and regulations leavealmost no room for personal touches in shed con-struction, though builders take pride in placingthe plywood panels close enough together thatthey look like a wall. “We always make it niceand smooth and seamless,” said SpringScaffolding’s Laffey. He paused to look at a photoin his office that showed the ParamountBuilding’s marquee practically swallowed up byhis firm’s shed. Whatever Times Square pedestri-ans negotiating their way around the shed mayhave thought, the wood panels were certainlysmooth. “It was a quality job,” Laffey said.

While there is huge demand for sheds, prof-its in the business have been constrained foryears by steadily rising labor costs. The averageNew York construction laborer’s pay rose by athird from 2004 to 2014, according to the U.S.Department of Labor, while the price of steelrose by more than 50% and lumber prices near-ly tripled before retreating in the past year.Amid rising costs, developers and contractorshave hired more nonunion shed-building


MICHAEL SCHNURR,president of National Paint

Industries, saw sales

quadruple after the city

mandated sheds be

painted hunter green.

WENDY WHITESELL’s

photos were selected to

be displayed outside

Barclays Center.

CONSTRUCTION | SCAFFOLDS EVERYWHERE


firms. Nonunion shed builders tend to getpaid about $20 an hour without benefits,compared to nearly $70 an hour, whichincludes the costs of benefits, for unionmembers. Even with lower labor costs,nonunion shed builders claim their profitmargins are only around 4%. Given thatone shed is almost exactly like another, the lowbidder usually wins. And there are hundreds offirms competing for work.

Shed building isn’t as dangerous as otherkinds of construction work because much of itis done fairly close to the ground. BuildingsDepartment data shows that 11 of the 199 con-struction accidents reported in the first half oflast year involved scaffolds and sheds, with nofatalities.

W ENDY WHITESELL is trying to make thecity’s sheds look better. Her photog-raphy is displayed outside Barclays

Center after it was selected by Art Bridge, anonprofit that decorates sheds with works byemerging artists. The exposure even helped hersell a few pictures. “It’s like being displayed ina gallery, only better,” Whitesell said.

Art Bridge Executive Director Stephen Piersonwould love to get more up-and-comers’ workdisplayed on sheds. “It’s a good way for a build-ing to brand itself,” he said. Yet the going is slow.Perhaps 20 buildings have allowed art to be dis-played on their sheds. The chief culprit is cost.

“People don’t want to pay for sheds, nevermind decorating them,” said Joe Covello, vicepresident at United Hoisting & Scaffolding, anda member of Art Bridge’s advisory council.

Indeed, ideas to make sheds look betteralmost invariably go nowhere because devel-opers figure that no one ever paid more to rentan office or buy an apartment because thebuilding once had a nice-looking shed. Formost real estate executives, the expense ofinstalling an aesthetically pleasing shed just isnot worth it. As Jonathan Drescher, senior vicepresident for project development at the DurstOrganization, delicately put it, “We try to doeverything in the best way we reasonably can.”

It doesn’t help that the Urban Umbrellaexperiment was a bust. Great as it looked—Mayor Bloomberg called it the shed for the 21stcentury—contractors said it didn’t fit well intothe city’s busy sidewalks, couldn’t supportscaffolding and cost twice as much as a con-ventional shed. Urban Umbrellas have beeninstalled in downtown Toronto, and Cortes saidhe is working on improvements. “For the pub-lic, it’s a forefront issue,” he said. “To develop-ers, it’s a line item.”

Another reason sheds don’t change is thatbuilders have assembled massive collections ofparts over the decades and aren’t interested instarting anew. At United Hoisting & Scaffolding’sheadquarters in Long Island City, stacks of beams,pipes and planks for sheds and scaffolds fill an80,000-square-foot yard. “We’ve got 10 timesmore stuff in use out in the field,” Covello said.

And developers may not be inclined to spendon nicer sheds because of the growing cost of set-tling lawsuits brought under New York stateLabor Law 240/241, better known as the scaffoldlaw. The statute holds building owners and con-tractors 100% liable for any gravity-related acci-dent in which they are at least partially at fault.Critics say the law has caused construction-insurance and legal costs to soar by $3 billionannually across the state. Efforts to repeal it were

thwarted by former Assembly Speaker SheldonSilver, who was of counsel to a personal-injurylaw firm that reaped fees from such lawsuits.Now that the convicted Silver is out of the pic-ture, the door is open to change, but trial lawyersremain one of Albany’s most powerful lobbies.

The building community and city tookanother crack at shed-beautification byannouncing four winners of another contestlast month. Unfortunately, shed builders aren’thappy with the latest crop, although Covellosaid all were pleasing to the eye and meet code.“Investing in a system that satisfies minimumrequirements is not a good investment for meunless a customer of ours is willing to overpay,which is rare. But it does happen,” he said.Another contractor said only one design looked“slightly realistic” and worried that all thecontest winners would collapse if hit by a car orbus because their spans are so long. “I doubtthat any of the designers or engineers wereasked to consider such a real-life situation,”the shed builder said. “This real-life situationhappens all the time.”

So it looks like New Yorkers will be stuck withthe old sheds for a while. If that’s the case, it maybe best to learn how to appreciate them. That’s noeasy task, but Benjamin Marcus, an architect and a

former construction-site manager atTiffany’s flagship store on Fifth Avenue, haslearned to see the brighter side.

“Sheds aren’t meant to be beautiful, butsometimes they just are,” he explained,walking along West 37th Street one rainyafternoon.

He came upon a shed on the south side of thestreet, between Seventh and Eighth avenues,and at first he didn’t like what he saw. Severallights weren’t functioning and a graffiti-writerhad spray-painted some of the columns. “Prettydisappointing,” he said, after a female pedestri-an hissed “Excuse me!” upon bumping intohim.

Then the shed’s artistic qualities began tocome out of the woodwork. Look, Marcus said,at how the shed comes within an inch of touch-ing the building without actually coming intocontact, because that would leave a mark.Down below, the uneven sidewalk slopedtoward the street, so the builders had stackedmudsills to even things out. “That is creating aperfectly level condition using really simplematerials,” he said. The roof was perhaps mostimpressive: The builders had lined planksabove the corrugated steel ceiling to create aspace that was safe to walk on. “They built arudimentary floor without nailing thingstogether, and they’re relying on tension tomake it work. And the way they’ve arrangedthe wood has a lovely pattern to it,” Marcussaid, snapping a picture for his Facebook page.

“The sidewalk shed, to me, is the found artof New York City.” �

JOE COVELLO, vice president of United

Hoisting & Scaffolding, said building

owners are unwilling to pay extra to

erect a prettier scaffold.


“SHEDS AREN’T MEANTTO BE BEAUTIFUL, BUT SOME-

TIMES THEY JUST ARE. THE SIDE-WALK SHED, TO ME, IS THE

FOUND ART OF NEW YORK CITY.”


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shall mail process to: c/o Executive

Management Offices, 545 Main St.,

NY, NY 10044. CT addr. of LLC 138

Goodhill Rd., Weston, CT 06883. Cert.

of Form. filed with CT Sec. of State, 30

Trinity St., Hartford, CT 06115.


Notice of Qualification of Magnet 360,

LLC. Authority filed with NY Dept. of


County. LLC registered in MN on



against it may be served and shall mail

process to: c/o National Registered

Agents, Inc., 111 8th Ave., NY, NY

10011, regd. agent upon whom

process may be served. MN and princi-

pal business address: 5757 Wayzata

Blvd., Minneapolis, MN 55416. Cert. of

Reg. filed with MN Sec. of State, 60

Empire Dr., St. Paul, MN 55103.


Formation of 371 Harlem LLC filed with

the Secy. of State of New York (SSNY)

on 12/8/15. Office loc.: New York County.



The principal business loc. and address

SSNY shall mail process to is Jason

Hoppy, 195 Hudson St., Apt. 5B, New York,

NY 10013. Purpose: Any lawful activity.Notice of Qualification of Centerbridge

Special Credit Partners III, L.P. Authority

filed with NY Dept. of State on 1/8/16.

Office location: NY County. LP formed in

DE on 1/5/16. NY Sec. of State desig-

nated agent of LP upon whom process


process to the principal business addr.:

375 Park Ave., 12th Fl., NY, NY 10152.

Regd. agent upon whom process may be

served: CT Corporation System, 111 8th

Ave., NY, NY 10011. DE addr. of LP: c/o

The Corporation Trust Co., 1209 Orange

St., Wilmington, DE 19801. Name/addr.

of genl. ptr. available from NY Sec. of

State. Cert. of LP filed with DE Sec. of

State, Duke & York St., Dover, DE

19901. Purpose: all lawful purposes.

Notice of Qualification of Centerbridge

Special Credit Partners General Partner

III, L.P. Authority filed with NY Dept. of


County. LP formed in DE on 1/5/16. NY

Sec. of State designated agent of LP


served and shall mail process to the prin-

cipal business addr.: 375 Park Ave., 12th Fl.,

NY, NY 10152. Regd. agent upon whom

process may be served: CT Corporation

System, 111 8th Ave., NY, NY 10011. DE

addr. of LP: c/o The Corporation Trust

Co., 1209 Orange St., Wilmington, DE

19801. Name/addr. of genl. ptr. avail-

able from NY Sec. of State. Cert. of LP filed

with DE Sec. of State, Duke & York St., Dover,


Notice of Qualification of Centerbridge

Special Credit Partners III-Flex, L.P.


1/8/16. Office location: NY County. LP

formed in DE on 1/5/16. NY Sec. of

State designated agent of LP upon

whom process against it may be served

and shall mail process to the principal

business addr.: 375 Park Ave., 12th Fl.,

NY, NY 10152. Regd. agent upon whom

process may be served: CT Corporation

System, 111 8th Ave., NY, NY 10011. DE

addr. of LP: c/o The Corporation Trust

Co., 1209 Orange St., Wilmington, DE

19801. Name/addr. of genl. ptr. available

from NY Sec. of State. Cert. of LP filed

with DE Sec. of State, Duke & York St., Dover,


P034-35CL_CN_20160125.qxp 1/22/2016 11:43 AM

TO PLACE A CLASSIFIED AD, CALL 1800 444 6007 OR VISIT CRAINSNEWYORK.COM



39 EAST 72ND STREET LLC Articles of

Org. filed NY Sec. of State (SSNY)

12/2/13. Office in NY Co. SSNY desig.

agent of LLC upon whom process may be

served. SSNY shall mail copy of process

to c/o United States Corp. Agents, Inc.,

7014 13th Ave., Ste. 202, Brooklyn, NY

11228, which is also the registered

agent upon whom process against the LLC

may be served. Purpose: Any lawful purpose.

Principal business location: 1155 Avenue

of the Americas , 6th Fl, NY, NY 10036.

Notice of Qualification of MetaProp Advisors

LLC. Authority filed with NY Dept. of State on

11/25/15. Office location: NY County. Princ.

bus. addr.: 18 W. 21st St., NY, NY 10010. LLC

formed in DE on 5/26/15. NY Sec. of State

designated agent of LLC upon whom process


process to: c/o CT Corporation System, 111

8th Ave., NY, NY 10011, regd. agent upon

whom process may be served. DE addr. of

LLC: 2711 Centerville Rd., Ste. 400,


with DE Sec. of State, P.O. Box 898, Dover,


Notice of Qualification of MPNYC GP I LLC.



Princ. bus. addr.: 18 W. 21st St., NY, NY

10010. LLC formed in DE on 11/4/15. NY

Sec. of State designated agent of LLC


served and shall mail process to: c/o CT

Corporation System, 111 8th Ave., NY, NY

10011, regd. agent upon whom process

may be served. DE addr. of LLC: 1209

Orange St., Wilmington, DE 19801. Cert.

of Form. filed with DE Sec. of State, P.O.

Box 898, Dover, DE 19903. Purpose: all

lawful purposes.

Notice of Qualification of Panorama Music

Festival, LLC. Authority filed with NY Dept.

of State on 11/25/15. Office location: NY

County. Princ. bus. addr.: c/o AEG Live,

145 W. 45th St., 9th Fl., NY, NY 10036. LLC

formed in DE on 11/20/15. NY Sec. of

State designated agent of LLC upon whom

process against it may be served and

shall mail process to: c/o CT Corporation

System, 111 8th Ave., NY, NY 10011, regd.

agent upon whom process may be served.

DE addr. of LLC: c/o The Corporation

Trust Co., 1209 Orange St., Wilmington,

DE 19801. Cert. of Form. filed with DE

Sec. of State, 401 Federal St., Dover,


Notice of Formation of Pearson Place

Holdings, LLC. Arts. of Org. filed with NY Dept.

of State on 12/3/15. Office location: NY

County. Sec. of State designated agent of

LLC upon whom process against it may be

served and shall mail process to: c/o

Windels Marx Lane & Mittendorf, LLP, 156

W. 56th St., NY, NY 10019, Attn: Charles J.

Hamilton. Purpose: all lawful purposes.

Notice of Formation of Favelukes

Consulting LLC. Arts of Org filed with Secy.

of State of NY (SSNY) on 10/5/2015.

Office location: NY County. SSNY desig-

nated agent upon whom process may

be served and shall mail copy of

process against LLC to principal busi-

ness address: 302 W. 86th St. #3C NY,

NY 10024. Purpose: any lawful act.

Notice of formation of Kismet Eleven,LLC. Arts of Org filed with Secy. ofState of NY (SSNY) on 8/6/15. OfficeLocation: NY County. SSNY desig-nated agent upon whom process may beserved and shall mail copy of processagainst LLC to principal businessaddress: 53 N. Moore Street, NY, NY10013. Purpose: any lawful act.

NOTICE OF FORMATION of FINI PRO-

DUCTIONS, LLC. Arts. of Org. filed w/Secy



nated as agent for service of process.

SSNY shall mail process to 678 St.

Nicholas Avenue #54 NY, NY 10030.

Purpose: Any lawful activity.

Notice of Qualification of 825 EAST 141ST

STREET INVESTORS III, LLC Appl. for Auth.

filed with Secy. of State of NY (SSNY)

on 12/17/15. Office location: NY

County. LLC formed in Delaware (DE) on

10/29/15. Princ. office of LLC: 430 Park

Ave., 12th Fl., NY, NY 10022. SSNY

designated as agent of LLC upon whom

process against it may be served. SSNY

shall mail process to c/o Corporation

Service Co. (CSC), 80 State St., Albany, NY

12207-2543, regd. agent upon whom

and at which process may be served. DE

addr. of LLC: c/o CSC, 2711 Centerville

Rd., Ste. 400, Wilmington, DE 19808. Cert.

of Form. filed with DE Secy. of State,

Div. of Corps., John B. Townsend Bldg.,

401 Federal St., Ste. 4, Dover, DE

19901. Purpose: Any lawful activity.

Notice of Qualification of 1825 PARKAVENUE PROPERTY INVESTORS III,LLC Appl. for Auth. filed with Secy.of State of NY (SSNY) on 12/17/15.Office location: NY County. LLCformed in Delaware (DE) on 10/06/15.Princ. office of LLC: 430 Park Ave.,12th Fl., NY, NY 10022. SSNY desig-nated as agent of LLC upon whomprocess against it may be served.SSNY shall mail process to CorporationService Co. (CSC), 80 State St., Albany,NY 12207-2543, regd. agent uponwhom and at which process may beserved. DE addr. of LLC: c/o CSC,2711 Centerville Rd., Ste. 400,Wilmington, DE 19808. Cert. of Form.filed with DE Secy. of State, Div. ofCorps., John B. Townsend Bldg.,401 Federal St., Ste. 4, Dover, DE19901. Purpose: Any lawful activity.

Notice of Qualification of 1825 PARK

AVENUE INVESTORS III, LLC Appl. for

Auth. filed with Secy. of State of NY

(SSNY) on 12/17/15. Office location:

NY County. LLC formed in Delaware

(DE) on 10/06/15. Princ. office of LLC:

430 Park Ave., 12th Fl., NY, NY 10022.


whom process against it may be

served. SSNY shall mail process to

Corporation Service Co. (CSC), 80

State St., Albany, NY 12207-2543,

regd. agent upon whom and at which

process may be served. DE addr. of

LLC: c/o CSC, 2711 Centerville Rd.,

Ste. 400, Wilmington, DE 19808. Cert.

of Form. filed with DE Secy. of State,

Div. of Corps., John B. Townsend Bldg.,

401 Federal St., Ste. 4, Dover, DE


Notice of Qualification of LFD Malone NY

LLC. Authority filed with NY Dept. of State

on 12/16/15. Office location: NY County.

LLC formed in DE on 12/11/15. NY Sec.

of State designated agent of LLC upon

whom process against it may be served

and shall mail process to: c/o Ladder

Capital, 345 Park Ave., 8th Fl., NY, NY

10154, principal business address. DE

address of LLC: 1209 Orange St.,

Wilmington, DE 19801. Cert. of Form.

filed with DE Sec. of State, 401 Federal

St., Dover, DE 19901. Purpose: all lawful

purposes.


Holdings Alternate III, L.L.C. Authority filed

with NY Dept. of State on 5/12/15. Office

location: NY County. LLC formed in DE on






Fl., NY, NY 10036, Attn: John Liftin, General

Counsel, regd. agent upon whom process

may be served. DE addr. of LLC: The

Corporation Trust Co., 1209 Orange St.,




Notice of Formation of HERRMANN

ASSOCIATES LLC Cert. of Conversion

filed with Secy. of State of NY (SSNY)

on 01/04/16, converting HERRMANN

ASSOCIATES to HERRMANN ASSOCI-

ATES LLC. Office location: NY County.

Princ. office of LLC: 1105 Park Ave.,

NY, NY 10128. SSNY designated as


against it may be served. SSNY shall

mail process to the LLC at the addr. of

its princ. office. Purpose: Any lawful activity.

Notice of Formation of 505 GREENWICH

STREET 3GH, LLC Arts. of Org. filed with

Secy. of State of NY (SSNY) on 01/08/16.

Office location: NY County. Princ. office

of LLC: 505 Greenwich St., Unit #3GH,

NY, NY 10013. SSNY designated as


against it may be served. SSNY shall

mail process to the LLC at the addr. of its

princ. office. Purpose: Any lawful activity.

Notice of Qualification of GOKUL WORK-

SHOPS LLC Appl. for Auth. filed with Secy.

of State of NY (SSNY) on 01/07/16. Office

location: NY County. LLC formed in

Delaware (DE) on 01/05/16. SSNY des-

ignated as agent of LLC upon whom

process against it may be served. SSNY shall

mail process to c/o Corporation Service

Co., 80 State St., Albany, NY 12207-2543.

DE addr. of LLC: c/o PHS Corporate

Services, 1313 Market St., Ste. 5100,


with DE Secy. of State, John G. Townsend

Bldg., 401 Federal St., Ste. 4, Dover, DE


Notice is hereby given that a license,

number 1289580 for beer and wine

has been applied for by the undersigned

to sell beer and wine at retail in a

restaurant under the Alcoholic Beverage

Control Law at 1569 Lexington Avenue

New York, NY 10029 for on premises

consumption. THE ROAST NYC LLC

d/b/a Roast Homestyle Chicken

Notice of Qualification of BAMTech,

LLC Appl. for Auth. filed with Secy. of

State of NY (SSNY) on 01/07/16.

Office location: NY County. LLC formed in

Delaware (DE) on 10/19/15. Princ. office

of LLC: 75 Ninth Ave., NY, NY 10011.



SSNY shall mail process to c/o

Corporation Service Co., 80 State St.,

Albany, NY 12207-2543. DE addr. of LLC:

2711 Centerville Rd., Ste. 400,


with Secy. of State, State of DE, 401

Federal St., Ste. 3, Dover, DE 19901.


NOTICE OF FORMATION OF Manhattan

Mental Health Counseling Services, PLLC.

Articles of Organization filed with the

Secretary of State of NY (SSNY) on

December 21, 2015. Office location:

NEW YORK County. SSNY has been

designated as agent upon whom process

against it may be served. The Post Office

address to which the SSNY shall mail a

copy of any process against the PLLC

served upon him/her is: 136 Madisoon

Ave, 6th Floor, NY NY 10016 The prin-

cipal business address of the PLLC is:

136 Madison Ave, 6th Floor, NY NY

10016 Purpose: any lawful act or activity

Notice of Formation of ZOIA PROPER-

TIES LLC Arts. of Org. filed with Secy. of

State of NY (SSNY) on 12/18/06. Office

location: NY County. Princ. office of LLC:

156 W. 56th St., 4th Fl., NY, NY 10019.



SSNY shall mail process to Adam Zoia,

1965 Broadway, PH3C, NY, NY 10023.


Contact Joanne Barbieri at 212-210-0189 for

classified advertising opportunities.

WANT TO GET YOUR COMPANY IN FRONT OF

250,000 INFLUENTIAL BUSINESS PROFESSIONALS?

Notice of Formation of QUANTUM DIAG-

NOSTICS LLC Arts. of Org. filed with Secy.



nated as agent of LLC upon whom


shall mail process to Corporation Service

Co., 80 State St., Albany, NY 12207-2543.


P034-35CL_CN_20160125.qxp 1/22/2016 11:48 AM

truTV: Marissa Ronca, 39,

was promoted to executive

vice president and head of

programming at the cable

network. She was

previously senior vice

president of development

and original programming.

Puja Vohra, 43, was

promoted to executive vice

president of marketing and

digital. She was previously

senior vice president of

marketing and digital.

Brooklyn

Nets: Tom

Bowden, 32,

was

promoted to

executive

director of

ticket sales and service of

the NBA team. He was

previously director of VIP

services.

ESI Design: Emily Conrad,

37, was promoted to

director of the immersive

and activity design group at

the design company. She

was previously senior tech

and media designer.

Lilker Associates Consulting

Engineers: Michael Leonick,

48, was promoted to vice

president at the

engineering consultant

firm. He was previously

head of the electrical

department.

Louis Licameli, 55, was

promoted to vice president.

He was previously director

of the Long Island office.

Univision Communications:

Tonia O’Connor, 46, was

promoted to chief

commercial officer and

president of content of

distribution at the

Spanish-language media

company. She was

previously president of

content distributions and

corporate business

development.

Quadrum

Global:

Anoop

Rustgi, 34,

joined the

real estate

developer

and investment firm to

oversee asset management

and acquisitions. He was

previously an associate at

Vanbarton Group.

PricewaterhouseCoopers:

Shawn Panson, 44, was

appointed U.S. private-

company services leader at

the professional services

firm. He was previously

leader of the risk assurance

cybersecurity, privacy and

IT risk practice.

Wells Fargo Insurance: Eric

Van Heyst, 59, joined the

insurance brokerage as

trade credit and political-

risk insurance manager. He

was formerly vice president

and senior credit officer at

QBE North America.

Anaplan: Jim Rich, 49, joined

the software company as

area vice president. He was

previously area vice

president at Salesforce.

OTC Markets Group: Bea

Ordonez, 43, joined the

financial markets operator

as chief financial officer.

She was previously chief

operations officer of

Convergex Group.

Partnership

With

Children:

Robin

Veenstra-

Vanderweele,

41, joined

the social-services

organization as chief

strategy officer. She was

previously director of child

and youth initiatives at the

Nashville Mayor’s Office.

Marina Schreiber, 50, joined

as chief financial and

administrative officer. She

was previously chief

operating officer at Domus

Kids.

Astoria Bank: David Cinelli,

29, joined the bank as vice

president in the retail

banking division and

manager of the Long Island

City branch. He was

previously vice president

and senior cluster manager

at HSBC Bank USA.

Brooklyn Sports and

Entertainment: Mike LaHaie,

33, joined the media

company as vice president

of premium partnerships.

He was previously manager

of suite sales for the New

York Yankees.

MGM

Racquet

Sports:

Michael

Moreno, 26,

was

promoted to

managing director at the

athletics company. He was

previously treasurer and

board member of the

Moreno Family Trust.

Lending.com: Corey Moreira,

44, joined the peer-to-

peer lending company as

chief technology officer.

He was previously chief

architect of the enterprise

growth group at American

Express.

Jenner &

Block: Susan

Kohlmann,

57, was

promoted

to office

managing

partner at the law firm.

She continues as chair of

the trademark, advertising

and unfair-competition

practice, as well as the

diversity and inclusion

committee.

TO PLACE A CLASSIFIED AD, CALL 1800 444 6007 OR VISIT CRAINSNEWYORK.COM


Notice of Formation of KOBE 66 LLC

Arts. of Org. filed with Secy. of State of

NY (SSNY) on 01/07/16. Office location:

NY County. SSNY designated as agent of

LLC upon whom process against it may

be served. SSNY shall mail process to

Oren Tepper, 203 E. 72nd St., Apt. 8A, NY,

NY 10021. Purpose: Any lawful activity.

Notice of Formation of Mighty Industries

LLC. Arts. of Org. filed with Secy. of State

of NY (SSNY) on 12/10/15. Office loca-

tion: NY County. SSNY designated as


it may be served. SSNY shall mail

process to: 15 W. 63rd St., Apt. 26A, NY,

NY 10023. Purpose: any lawful activity.

Notice of Formation of Atrium Managed

Services LLC. Arts. of Org. filed with Secy.



nated as agent of LLC upon whom


shall mail process to: 71 5th Avenue, 3rd Fl.,

NY, NY 10003. Purpose: any lawful activity.

Notice of the formation of Cara

Dussich, LLC. Arts of Org filed with


10/1/2015. Office location: NY


whom process may be served against

LLC to: 7014 13th Ave #202 Brooklyn,

NY 11228. Principal business address:

210 E 73 St. #4A NY, NY 10021.

BENKSHAW ENTERPRISES LLC Articles

of Org. filed NY Sec. of State (SSNY)

11/16/2015. Office in NY Co. SSNY desig.

agent of LLC upon whom process may

be served. SSNY shall mail copy of

process to 343 E. 74th St., #17CD, NY, NY

10021. Purpose: Any lawful purpose.

Notice of Formation of Tick TockSeries, LLC. Arts of Org filed withSSNY on 9/3/2015. Office location:NY County. Princ. bus. addr.: 838Greenwich St. PHB, NY, NY 10014.SSNY designated agent upon whomprocess may be served against LLCto: 440 W 47 St. #3i NY, NY 10036.Purpose: any lawful act.

Notice of formation of SEGELOV PHYSI-

CAL THERAPY, PLLC. Art. of Org filed w/

secy of state of NY (SSNY) on


SSNY designated as agent for services

of process. SSNY shall mail process to

80 State Street, Albany NY, 12207.


Notice of Qual. of Coatue CT VII LLC,

Auth. filed Sec’y of State (SSNY)

3/13/15. Off. loc: NY Co. LLC org. in DE

3/11/15. SSNY desig. as agent of LLC

upon whom proc. against it may be served.

SSNY shall mail copy of proc. to Att:

Philippe Laffont, 9 W. 57th St., NY, NY

10019. DE off. addr.: CSC, 2711

Centerville Rd., Wilmington, DE 19808. Cert.

of Form. on file: SSDE, Townsend Bldg.,

Dover, DE 19901. Purp: any lawful activities.

Notice of Qual. of Coatue CT VIII LLC,

Auth. filed Sec’y of State (SSNY) 4/8/15.

Off. loc: NY Co. LLC org. in DE 4/6/15.

SSNY desig. as agent of LLC upon whom

proc. against it may be served. SSNY

shall mail copy of proc. to Att: Philippe

Laffont, 9 W. 57th St., NY, NY 10019. DE

off. addr.: CSC, 2711 Centerville Rd.,

Wilmington, DE 19808. Cert. of Form. on

file: SSDE, Townsend Bldg., Dover, DE

19901. Purp: any lawful activities.

Notice of Qual. of Crow Hill Fund, LP,


Off. loc: NY Co. LP org. in DE 4/24/15. SSNY

desig. as agent of LP upon whom proc.

against it may be served. SSNY shall mail

copy of proc. to 256 W. 116th St., 2nd Fl.,

NY, NY 10026. DE off. addr.: CSC, 2711

Centerville Rd., Wilmington, DE 19808. Cert.

of LP on file: SSDE, Townsend Bldg., Dover,

DE 19901. Name/addr. of each gen. ptr.

avail. at SSNY. Purp: any lawful activities.

Notice of Qual. of Crow Hill Fund GP, LLC,


Off. loc: NY Co. LLC org. in DE 4/24/15.

SSNY desig. as agent of LLC upon whom

proc. against it may be served. SSNY shall

mail copy of proc. to Att: Alex Friedman,

256 W. 116th St., NY, NY 10026. DE

off. addr.: CSC, 2711 Centerville Rd.,

Wilmington, DE 19808. Cert. of Form.

on file: SSDE, Townsend Bldg., Dover,

DE 19901. Purp: any lawful activities.

Notice of Formation of Pez LocoPartners LLC, Art. of Org. filed withSec’y of State (SSNY) on 5/29/15.Office location: NY County. SSNYdesignated as agent of LLC upon whomprocess against it may be served.SSNY shall mail copy of process toSeward & Kissel, Att: Hume Steyer,One Battery Park Plaza, NY, NY10004. Purpose: any lawful activities.

Notice of Formation of Buckner

Company of Colorado, LLC. Arts of Org

filed with Secy. of State of NY (SSNY) on


SSNY designated agent upon whom

process may be served and shall mail

copy of process against LLC to: 6550 S

Millrock Drive STE300, Salt Lake City, UT

84121. Purpose: any lawful act.

Notice of Formation of GOV BALL 2016,

LLC. Arts. of Org. filed with NY Dept. of




may be served and shall mail process to:

Founders Entertainment, 86 E. 10th St.,

Suite 1, NY, NY 10003, principal business

address. Purpose: any lawful activity.

MH LAM, LLC. Arts. of Organization filed

with Secy. of State of NY (SSNY) on

12/24/15. Off. loc.: New York Co. SSNY

des. as agent of LLC upon whom

process may be served. SSNY shall mail

process to the LLC, Attn: Beth Thornton,

481 Washington St., #1N, New York, NY

10013. Purpose: General.

Notice of Formation of S.H.E. 959 ONE

LLC. Arts. of Org. filed with Secy. of State

of NY (SSNY) on 1/13/16. Office location:

NY County. SSNY designated as agent of

LLC upon whom process against it may

be served. SSNY shall mail process to:

Ivan Moskowitz, Esq., Schiff Hardin LLP,

666 Fifth Avenue, Ste. 1700, NY, NY

10103. Purpose: any lawful activity.

EXECUTIVE MOVES


ELLEN ARCHER, 53, joined the

company as president of trade

publishing. She was formerly a

founding partner at Path2 and

is currently managing director

at Golden Seeds.

HOUGHTON MIFFLINHARCOURT:

EXECUTIVE PROMOTIONS

The fastest way to get an announcement into Crain’sis to submit online. Fill out the form at CrainsNewYork

.com/execmoves. TheExecutive Moves column is also available online.


CAREN MAIO

AGE 31

BORN Yonkers, N.Y.

RESIDES Brooklyn

EDUCATION New York University,

B.A. in brand building

NOT SO FAST Maio was so eager

to start her own business that she

planned to drop out of college, but

her parents urged her to stay in

school and gain on-the-job experience.

She listened.

EXPANSION Nestio will double its

footprint to 7,000 square feet when

it moves to Chelsea Castle, on

West 22nd Street.

HIRING MODE The firm will need the

extra space. It will use an infusion of

capital to double its workforce to 60

employees during the next year.

BU

CK

EN

NIS

GOTHAM GIGS

HUNTING GUIDE: Caren Maio would like

Nestio to become the

rental clearinghouse

the city sorely needs.


Caren Maio knew she was destined for a

career in real estate when, as a student at

New York University, she repeatedly vol-

unteered to help friends move.

“I loved it,” she said. “I’ve been enamored by New

York real estate for a long time.”

At 31, Maio now works on a far grander

scale as the chief executive of Nestio, the

tech company she co-founded in 2011. In

December, it received $8 million in ven-

ture-capital funding, effectively doubling

the company’s number of employees.

Nestio is an online business-to-business

conduit for apartment listings. When land-

lords record vacancies or occupancies in their buildings

on one end of the portal, brokerages and apartment-

hunting websites like StreetEasy and Trulia instantly reg-

ister it on the other. To understand why this concept is so

novel, it is important to note just how vast, fractured and

unreliable the listings data landscape is in New York City.

Unlike selling a home or condominium, where both

the listing and sale must be registered in public databases,

no such central clearinghouse exists for most rental units.

(A small portion is listed by the Real Estate Board of New

York, which uses Nestio and other firms to export and

update its own database.) Instead, landlords often use

spreadsheets and emails that trickle to brokers and search

sites before reaching consumers, but this information can

be outdated and incorrect.

“We looked at this and asked, ‘Why can’t people get

accurate listing info when it comes to

rentals?’ ” Maio said.

She had always wanted to be an entrepre-

neur. At NYU, she participated in a program

to create her own major. After working in

business development after graduation, Maio

and two partners had an idea for a tool to help

renters catalog and share apartment listings.

In 2011, they were accepted to the Techstars

accelerator program in the garment district.

“We quit our jobs, and that’s how we began Nestio,”

she said.

They soon noticed their product would be only as good

as the data behind it, so Maio and one partner shifted the

focus to listings information. Maio hopes Nestio eventual-

ly becomes the rental clearinghouse the city lacks.

The firm is off to a good start. So far it is used here by

landlords such as Two Trees Management, and this year

will operate in Chicago, Washington, D.C., and Boston.

– JOE ANUTA

Making it easier to find an apartment in NYC

Why can’t you

get accurate

info when

it comes to

rentals?”

Caren Maio’s company tames city’s unruly apartment rental data and attracts an $8 million investment

“


Frick Collection thanks directors

On Jan. 11, the Frick Collection hosted its annual Directors Circle Dinner. It is a small affair—only

40 guests attended—when the museum thanks its directors for their support. The display of grati-

tude was very special: The event is held in a gallery that was once the Frick family’s dining room. It

is the only time the museum holds an event in that space.

Artists awarded mucho De Niro

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SEE MORE OF THIS WEEK’S SNAPS ONLINE AT CRAINSNEWYORK.COM/SNAPS

GETYOUR GALA IN SNAPS. EMAILTHERESA AGOVINO, [email protected]

Elaine Textor and her husband, Donald, a portfolio man-

ager at Dorset Energy Fund, with Frick Board of Trustees

Chairman Margot C. Bogert, at the museum dinner.

‘Noises Off’ parties on

Artists Stanley Whitney and Joyce Pensato, actor Robert De Niro and artists

Laura Owens and Robert Bordo at a Jan. 11 ceremony, where De Niro present-

ed Owens an award for her painting. The other artists are previous recipients of

the $25,000 prize that is administered by the Tribeca Film Institute and named

for the actor’s father, Robert De Niro Sr., an abstract expressionist painter who

died in 1993.

Derek McLane, set designer for Noises Off, along with one of the show’s stars,

Andrea Martin, and its director, Jeremy Herrin, at the play’s opening-night

party on Jan. 14.

Actor Jim Dale and

Noises Off male lead

David Furr at the

show’s opening-

night party at B.B.

King Blues Club

& Grill.

Frick Director Ian Wardropper, curator

Aimee Ng, Frick trustee and Blackstone

Group Chief Executive Stephen A.

Schwarzman and his wife, Christine, at

the museum dinner.


PHOTO FINISH

One way tobeat the boot

A for-hire car with Connecticut plates

left a memento the morning it drove

away from a parking spot on Greene

Avenue in Bedford-Stuyvesant,

Brooklyn: a wheel with a yellow steel parking-

infraction boot still attached.

The city’s Department of Finance brought

back the boot in 2012, after its first iteration—in

1986—was phased out in the mid-1990s. Now,

drivers with $350 or more in overdue parking

fees, speeding tickets or red-light violations get

the clamp. They then have 48 hours to pay by

phone before the car is towed. (The NYPD has its

own boots for cars it is waiting to tow.)

The practice has brought down the number of

cars towed to 41,114 in 2013 from 108,564 in 2010.

Upgraded boots from New Jersey-based Paylock

can be unlocked car side after drivers pay the

outstanding fines and fees for the boot, plus

Paylock’s 2.49% convenience fee.

Owners try to beat the boot the hard way.

Videos have popped up on YouTube giving step-

by-step instructions, including deflating tires or

dismantling the lock. But that just adds a $250 fee

to the driver’s tab, and it doesn’t make tickets

disappear.

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— PETER D’AMATO


Ted Tomita | Senior VP & CTO

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