The Real Deal New York

The shadow candidate this year: Real estate

November 01, 2010 07:00AM
By Stuart Elliott

  • Print
alternate text
Stuart Elliott

Never in recent memory have all the leading contenders for New York State governor had such visible backgrounds in real estate.

For Carl Paladino, his career as a Buffalo builder may actually hold some of the clues to why he makes such an erratic candidate. (Turns out the term “Buffalo builder” is not an oxymoron; people actually do still construct new buildings in perennially depressed upstate New York.)

Paladino has built a real estate empire through his Ellicott Development Company, which reportedly manages some $500 million worth of offices, stores, apartments and hotels, and Paladino himself has a net worth that tops $150 million.

Paladino also blazed a path during the 1990s as a developer for Rite-Aid, building more than 160 stores for the drugstore chain in New York and Pennsylvania, according to a recent story in Syracuse’s Post Standard. He often aggressively pushed through his projects in the face of “not in my backyard” opposition from residents as well as city planners. He used tactics like threatening to surround an 83-year-old man’s home with an asphalt parking lot because he would not sell it to make way for a project.

Of course, that approach is all well and good for a developer. Developers are often lone wolves, pushing through their vision for their community even when vocal parts of the community stand opposed.

But that’s also why developers, who often don’t worry about appealing to the consensus view, don’t always make the best political candidates, either. Can you think of many successful developers-turned-politicians?

You could throw Donald Trump into the same boat (though obviously he’s not as crazy), as Trump’s long-discussed run for president — reports of which seems to be surfacing again — would never likely be more than a novelty act.

For Andrew Cuomo, his real estate background as the nation’s top housing chief at the Department of Housing and Urban Development, arguably his formative political job, will inform how he governs, given his likely victory two days from now.

Cuomo is, of course, coming from a successful turn as state attorney general. But as we found out from son-of-a-developer Eliot Spitzer, following his defeat of Assemblyman John Faso, a successful AG does not necessarily a successful governor make (prostitution scandal aside). The AG is another lone-wolf position where you don’t have to play nice.

So it’s much more telling to look at Cuomo’s tenure at HUD, a sprawling agency that now has 10,000 employees and a budget of $43 billion, which is nearly one-third of the New York State budget. Cuomo dramatically increased the number of low-income loans Fannie Mae and Freddie Mac were required to back, which some have said contributed to the subprime mortgage crisis. Paladino, characteristically, labeled Cuomo as the “one man” responsible for the entire housing bubble. While that’s obviously overkill, it shows Cuomo’s big-government tendencies at a time when the debate is still alive as to whether big government will save or cripple the economy (including real estate) in the long run.

And then there is Jimmy McMillan, whom, yes, I’ve included as among the three most visible candidates for governor, due to the fact that his campaign went viral after his mutton chops and black gloves stole the show at last month’s debate among the seven gubernatorial candidates. His Rent Is Too Damn High Party functions, unintended or not, as a parody of tenant advocacy groups. Best of all, the party has only three members, and McMillan, a registered Democrat, isn’t even one of them.

It will probably be a good thing, then, when Cuomo gets down to business following the election, moving forward with real estate initiatives that lapsed under Governor Paterson. In the city, too, expect a renewed push from Mayor Bloomberg on his real estate and development agenda (see story here).

Speaking of billionaires, definitely check out our feature on the wealthiest figures in New York real estate. Also, take a look at reporter Candace Taylor’s stories on the resurgence of rental development in the city. New rental buildings continue to get fancier, despite leaner economic times, in part because affluent people are deciding to rent rather than own amid the still-uncertain real estate market. Enjoy the issue.


 Stuart Elliott

Comments are closed.

MENU

Subscribe to our email newsletters

New York Real Estate News
South Florida Real Estate News