“This building has a couple of screw-ups. But it has integrity.” - Rafael Viñoly, on 432 Park

White is the color of timeless elegance, of wealth that doesn’t need to shout. Applying this principle to a supertall skyscraper facade, however, may have led its developers to a pretty dark place. 👇

Cammeby’s 🐐 Ruby Schron w/ fellow titan Shimmy Glick (h/t CBN) - our readers obv know Schron, but Shimmy is equally fascinating: Big 💎 guy (Sharon Stone 😍 rocked a Glick engagement 💍 ) , he & his dad Louis Glick were tight w/ Paul Reichmann & were early investors in the Reichmanns’ Canary Wharf megaproject in London. When the Qataris & Brookfield moved to take it over, they had to make nice w/ Glick.

Glick was also a backer of David Bistricer & Sam Levinson on their play for NYC’s mammoth Stuy Town housing complex. And he was the equity on Nightingale Properties (yes, Elie Schwartz’s Nightingale)’ $175M purchase of a Newark office tower. Real gs…lasagna 🍝

CIM Group & Harry Macklowe’s 432 Park Avenue is one of the most prominent towers in America. It was also among the most successful condo projects (for CIM at least, a heavy * on Macklowe) of its time, the giddy era of Billionaires’ Row. But there’s since been some epic buyer’s remorse at the supertall: the condo board has brought multiple massive lawsuits against CIM & Macklowe, alleging everything from construction defects that have made living at the building a nightmare to even more serious allegations of “deliberate and far-reaching fraud” related to cracks in the facade. The tower being what it is and where it is has also attracted an immense amt. of media scrutiny – the NYT has devoted multiple front-page stories to its woes. In the latest, it focuses on the structural issues: hundreds of cracks that require a 9-fig capex job, and revelations that concerns about the white exterior had been flagged by several members of the development team. But Macklowe wanted “an absolutely pure building,” and pushed for a clear-coat finish akin to the one used on Unfurled, his racing yacht ⚓

This bit from the story is really something

One of the development team’s own engineers, Mr. Marcus, sided with consultants who had endorsed the more inelegant coating, even though it could “have appearance impact,” he wrote in an October 2013 email.
“You are not being at all helpful!” Bill Unger, a senior member of 432 Park’s development team, shot back in an email.
“Honestly, I prefer to disappoint today rather than installing something that even the manufacturer has doubts that will work,” Mr. Marcus replied

“A 10-year-old building should not be showing that level of deterioration,” structural engineering researcher Jose Torero told the paper. “Nobody can argue that that is not a failure.” CIM insists such claims are baseless and added that accusations that the developers were cavalier about risk were “categorically untrue, defamatory and yet another misstep by the board that will drive down property values.” Macklowe declined to comment – the man’s busy w/ his latest caper on Madison Ave. ⛵

Bonus: The Promote joined the fine folks at the B1M to talk through some of the drama at the tower this summer 👇

An intriguing multifamily dispute out of DC 🦅 that has landlords spooked: Petra Management Group has agreed to pay $700K to settle allegations it discriminated against renters without housing vouchers. The DC AG had alleged that Petra leased rent-controlled units solely to ppl part of the city’s housing-voucher program, which reimburses landlords at rates higher than the max rents they could charge for RS units. The crux of the suit, per WaPo: Petra advertised its units exclusively at the higher subsidized rates, and in doing so deterred non-voucher low-income renters from applying. The settlement will see Petra advertise the units at the rent-controlled rates moving fw, and also submit to an annual cavity search by the AG for 3Y.

The firm argues this is a “no good deed…” situation. Its attorney said that the firm spent millions to buy and renovate buildings, provided units as part of a city program, and yet, “for their efforts, OAG sued Petra as discriminating against non-voucher tenants.” In the past, landlords have faced legal heat for discriminating against housing voucher tenants; now, the city’s flipping the script. There’s a lot of political momentum across the country for landlord crackdowns, both on RS and market-rate (i.e. RealPage-related settlements) units.

W/ ESG investing completely out of style, the big fund managers have come up w/ a novel way to pull on the heartstrings: Ares credit bigwig Joel Holsinger has launched Promote Giving, an initiative where fund managers commit at least 5% of the promote to charities. “We’re not doing anything that looks at lower returns,” Holsinger told the AP (note for media nerds: this is not normal hard-news AP, but reads more like sponcon AP). “It’s basically just a dual mandate: If we do good on returns for our institutional investors, we will also drive returns that go directly to charity.” Managers running $35B have signed up so far; how much $ will actually make it into charitable coffers is the Q of the age 👛

Happy Diwali! May your year be filled with prosperity & light - HS 🎆 🪔

On Friday, we dove into SL Green’s highlight reel of the past year, from a ≈ 120% IRR coup on a distressed-debt Fifth Ave play to Harry Sitomer’s rise as the undisputed heir-apparent to raking in $1B for its new debt fund. Today, we look at the less successful bits of the journey.