TALE OF TWO STEVES

The biggest inequality in our industry is the real estate tax assessment program, and the expiration of the 421(a) tax abatement program is a policy that needs to be corrected, said Related Cos CEO Steve Ross, right, who joined Vornado chair Steve Roth, center, for a lively discussion moderated by Fried Frank real estate chair Jonathan Mechanic at yesterday’s packed REBNY member’s luncheon. The residential building tax is 33% to 35% of a building’s gross income. “You cannot build new construction with those types of taxes,” he says, noting that once abatements are over, affordable housing tenants may have to move out of buildings as ownersconvert units to co-ops. He says the City recognizes this but has yet to give a solution.
How do we keep the city competitive, especially when 46% of NYC residents have college or enhanced degrees compared to 27% of the rest of the country? We have to nurture and support the creative, intellectual workforce, Roth urged the crowd of 850. For instance, the average Park Avenue building is between 50- and 60-years-old, andgrossly undersized for contemporary industries and technologies. Take a page from London—knock down old buildings and replace them with ones double the size, he says. Both discussed Midtown and West Side construction as new alternatives, including Related’sHudson Yards and Vornado’s 15 Penn Plaza and 20 Times Square.
REBNY also announced its coveted “Most Promising Commercial Salesperson of the Year Award” at the luncheon. Studley’s Bill Montana presented this year’s award to Vornado’s Andrew Ackerman, who was part of some of the REIT’s most significant NYC deals this year, including CapitalOne’s 135k SF lease at 90 Park Aveand Jones Lang LaSalle’s 82k SF lease at 330 Madison Ave. Congrats to Andrew and all of this year’s well-deserved nominees: Cushman & Wakefield’s David Berke, Newmark Knight Frank’s Lee Brodsky, CBRE’s Jared Freede, Vicus Partners’ Aaron Kaufman, and Colliers International’s Michael Thomas.

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