The Real Deal New York

Real estate is traditionally slow to adopt technology.

But adopting the newest high-tech devices today is not about gimmickry. It’s about being effective and competitive. In increasing numbers, brokers are signing on for the latest communications tools to enhance their business.

What’s hot right now, and what chief technology officers at Manhattan residential real estate companies seem to think most promising, are handheld devices which allow users to check e-mail, make phone calls and store and access information, all wirelessly.

“Most of the brokers don’t subscribe to the high-tech thing,” said Charles Olson, Corcoran’s chief technology officer. “But some of them have to have the latest technology.”

“A lot of the top agents, they’re the ones you see using technology heavily,” said William Hunt III, a President of Coldwell Banker Hunt Kennedy. “But in general, our agents are all over the map.”

While Wi-Fi has been getting a lot media attention lately, it’s the handheld devices that have been around a while and are constantly improving, that companies say brokers are using in the greatest numbers.

Such devices include BlackBerry handhelds which fit in a jacket pocket and allow users to check e-mail, and on newer models, make cell phone calls. Also popular are combination cell phone/PDAs like the Kyocera 7135 Smartphone, which work slightly differently but offer much of the same services, including address books, calendars, notepads and other features.

At the most basic level, the devices enable users to store information and monitor their e-mail when they’re not at the office something that is essential considering how people communicate today, said Hunt.

Hunt notes that the average buyer nationally is in his or her early 30s, and is more likely to be reliant on e-mail than the average broker, who is in his or her early 50s.

“Some clients expect people to deal with them mostly through e-mail,” Hunt said. “They’re expecting that agents will check their e-mail every 45 minutes.”

Overall, the number of agents using handheld devices is still small. Olson estimates that about five percent of agents at Corcoran are using them.

Kim Klever, director of strategic development at Douglas Elliman, said around 10 percent of agents at her company are using BlackBerry devices now.

However, Klever expects that number to double soon. Douglas Elliman is about to introduce a program that will help agents pick out the right devices for them based on what features they are looking for. Agents buying through the program will be able to get discounts on devices and connection services.

Corcoran doesn’t offer a similar program, but provides technical assistance. “We support anything that will keep agents in greater contact with their clients,” said Olson.

Douglas Elliman has also come out with other features to help make the company more competitive. Within the last couple of months, the company launched mobile.elliman.com, which enables clients to search a company Web site from a mobile device. The site contains listings and open house information.

Eventually, the company will add floor plans, photos and other downloadable information, Klever said. Douglas Elliman is also looking to create an internal company system that is accessible via mobile handheld devices.

Another hurdle that will soon be overcome is the problem of not being able to transfer one’s phone numbers from an old cell phone to a new handheld device.

“It’s supposed to happen sometime this fall, where you’ll be able to transfer your number,” Klever said.

Partly as a result of not being able to transfer phone numbers and partly because they want to embrace any new technology, some brokers walk around with many devices at a time. “Some top agents carry around a PDA, cell phone and BlackBerry,” Klever said. “They try all sorts of technology.”

Costs are not usually prohibitive, said Klever. “Generally, devices are under $500, so for a top agent, it’s like pocket change.”

So with all the options out there, what to use?

Olson of Corcoran said he prefers the cell phone/PDAs over BlackBerry devices. He said he personally uses the Kyocera 7135 Smartphone. Storing and accessing data on the device is not as difficult as with the BlackBerrys, he said.

“In terms of organization the calendar and the contact manager it’s easier to use,” he said. “Also, BlackBerry coverage is spotty, especially in Manhattan.”

Klever of Douglas Elliman, by contrast, spoke more highly of the BlackBerry devices. She described the differences between BlackBerrys and the cell phone/PDAs as the difference between “push” and “pull” technologies.

“With the BlackBerry, it notifies you of e-mail right away,” said Klever. With the cell phone/PDA, “you have to look and check if you have e-mail,” she said.

But Olson seemed to express some skepticism. “With the BlackBerry, theoretically you get immediate notification of e-mail,” he said.

Finally, earlier BlackBerry devices didn’t start out as having cell-phone capabilities, and some of the later models still feel and look like the phone component has been tacked on. Some observers have noted that the Kyocera is a trimmer device that integrates both the PDA and cell phone functions well.

Manhattan is increasingly rife with Wi-Fi networks, with computer users able to log on to the Internet wirelessly from their laptop at home, in public parks and even at Starbucks.

But many residential real estate companies in New York say that Wi-Fi isn’t likely to have a huge impact on the way brokers do business in the near future.

Technology officers at several companies said concerns about security, the working habits of brokers and the popularity of handheld devices over bulky laptops when brokers are on the road are top reasons why Wi-Fi isn’t hot right now.

“It’s a very small number that are using it,” said Charles Olson, chief technology officer for the Corcoran Group. “Two or three brokers have it set up in their cars. It’s much less than five percent of all brokers that are using it.”

“I don’t know if anybody is as interested in that as in handheld devices,” said Kim Klever, director of strategic development at Douglas Elliman. Olson said brokers like smaller devices like BlackBerrys and cell phone/PDAs that they can fit in a pocket. Those devices can access e-mail, and some have Internet and Wi-Fi capablities.

“If brokers have handheld devices, how many things are they going to want to carry with them?” asked Olson. He added that most brokers do all their homework on the Internet at home or at the office, before going out on the road.

Klever said her company was “more interested in getting listings on mobile devices at this point,” rather than focusing on Wi-Fi.

However, Olson holds out the possibility that Wi-Fi could become more popular later.

“As it becomes easier,” he said. “I think you’ll probably see more brokers carry their laptops with them.”

Depsite the fact that some companies aren’t very enthusiastic about Wi-Fi, brokers who do use Wi-Fi say it gives them an advantage over their competition. While showing apartments, brokers can access listings and show pictures of other homes on the market to clients. They can also access information about schools, taxes and neighborhoods. Some brokers say it is particularly useful during “voids” at open houses. If a buyer has toured an apartment but didn’t like it, instead of putting their name on a list and getting in touch with them later, brokers can have access to listings and can assist potential buyers onsite.

Wi-Fi also holds possibilities for real estate offices, and company-wide systems would mean brokers wouldn’t be “frozen to their desks,” said William Hunt III, a president of Coldwell Banker Hunt Kennedy.

“I could reconfigure my office differently if we were hooked up to Wi-Fi,” he said. “Space is at a premium in New York, so it makes a difference.”

But he said “security issues” – the fact that a wireless system could be unsecure and that people might be able to access confidential company data–prevent him from making the switch.

Klever also has concerns about security. She said Douglas Elliman is using Wi-Fi on a “limited basis” now, including in training rooms and conference rooms.

She sees some possibilities for using Wi-Fi in storefront offices “to create more mobility and less clutter.”

Meanwhile, on the streets of New York, wireless hot spots, or nodes, that enable people to surf wirelessly, are proliferating rapidly.

Wireless networking is often a communal activity. Individuals often hang an antenna for their own system out a window, making Internet access available to anyone who wants it.

The Public Internet Project, a non-profit organization, mapped more than 13,000 places in Manhattan alone where signals from home or office wireless networks can be detected and used by a computer user.

The city has also gotten into the mix, creating wireless access points at a number of parks.

With a glut of rentals on the market in New York, every little perk that might draw renters helps.

In addition to one or two month’s free rent or free gym memberships, some building owners are going the high-tech route to lure renters.

Related Rentals, which operates 16 luxury rental properties in Manhattan, recently unveiled a host of high-tech services from Wi-Fi in apartments to e-mail concierge services that notify residents when they have a delivery to the ability to pay rent on a credit card.

The high-tech services were unveiled last month at The Westport, a new Related project.

The building at 10th Avenue and 56th Street is in competition with many other new residential high-rises on the far West Side for today’s young renters, who are tech-savvy and demand a high level of service.

“The lives and lifestyles of renters are different than they used to be,” said David J. Wine, vice chairman of The Related Companies, which is the developer for AOL Time Warner building. “We’ve got to adapt. We want people to be happy.”

At the Westport, and at most all other rental properties Related Rentals operates in Manhattan, clients can deal with a number of day-to-day concerns electronically. Users can submit service requests via e-mail, access messages from the concierge or building staff and receive notification of package and laundry delivery. LCD monitors have also been set up in the mailroom to list building notices and package deliveries. The Westport also offers a “resident web site” where renters can access building announcements and other information and make online rental payments.

A move-in coordinator helps residents set up and coordinate telecommunications, cable and technology services. Apartments at the Westport feature multiple phone lines, and access to Wi-Fi service, as well as DSL, digital cable and satellite TV.

The perks don’t end there. Renters are also able to earn miles by paying their rent with the American Express card.

Many of Related’s buildings also offer Business Centers where residents can work, teleconference and hold meetings with clients and colleagues. Free fax and copy services are also offered, and many buildings include ATMs and even Metrocard dispensers.

And should a particular Related property not suit a renter, they can always transfer to another property, for free, with only 30 days notice.

“We just had a couple living in one of our buildings, and the wife found out she was pregnant,” said Wine. “Within a month, they were at a bigger, three bedroom apartment in one of our other buildings.”

You’ve already got the basic technology tools, but want more?

With technology moving at the speed of Moore’s Law (which posits that computing power doubles every 20 months), new high-tech products handy to a broker are hitting the market every day.

Among the new products, some are useful, some are fun, and some just plain gimmicky. The following is a partial list of what’s available and who’s using it:

Business card-sized CD-ROMs. Some brokers are handing out small CD-ROMs instead of the traditional business card. The cards usually contain biographical data and other information. “It’s a gimmicky thing,” said Kim Klever, director of strategic development at Douglas Elliman. Brokers into the latest technology are handing them out, but “some people are not tech-savvy enough to appreciate them,” she said.

Camera Cellular Phones. The latest trend in cell phones are ones that come equipped with cameras, which can send photos electronically. Charles Olson, chief technology officer for the Corcoran Group, said he could see the cameras being more widely used later on, but doesn’t know many people who are using them now to take photos of apartments for listings. “It might also be useful for brokers who are carrying around too many devices,” he said. Brokers being able to send photos instantly to the office is also a bonus, though usually it’s “not quite that urgent” to get a photo up on the company’s Web site, Olson said. Klever said she sees drawbacks in terms of the photo resolution afforded by most cameras. “Right now, they generally don’t have enough resolution to be of use,” she said. “But they’ll probably get better.”

Tablet PCs & Pen-Based Notebooks. Somewhat akin to a cross between a laptop and a PDA, they weigh in at three to four pounds, connect to the Internet wirelessly, and may or may not include a keyboard. Most offer advanced handwriting recognition capabilities that let you create, store, and transmit handwritten notes. But some users have difficulty in getting the handwriting recognition features up and running. Olson said, “they haven’t really been adopted.”

Laser Tape Measure. Some brokers view these tapeless measuring devices, which use a narrow ultrasonic beam to measure, as a convenient gadget. Just point the device at the wall, press a button, and instantly measure room dimensions.

Business Card Scanner. This tech tool extracts text from business cards and can export the data directly to e-mail or other programs. The drawback is that some scanners have trouble sorting out information into specified categories, so there is usually considerable editing to be done when the data comes up on the computer screen.

Keychain Flash Memory Drives. About the size of a pack of gum, they can be attached to a keychain ring or slipped in a wallet. The devices can store anywhere from 64 MB to 256 MB of data meaning plenty of photos, documents and Powerpoint presentations, which Klever notes are popular among brokers. Just plug it into a USB port on your computer and you’re ready to start copying.

Leslie Day’s place has got a great Manhattan waterfront view. She pays about one-third the cost of nearby apartments and gets around three times the space.

The reason? Day’s place isn’t just on the water, it’s in the water. Day lives on a houseboat in the West 79th Street Boat Basin. Home is a 57-foot boat with two bedrooms and two decks, which she shares with her husband, three cats and a cockatoo.

Part of a “live-aboard” community that numbers roughly 35, and includes houseboats, sailboats, cruisers, an old Maine Ferryboat and a couple of floating homes, Day knows a great real estate deal when she sees it.

Her dockage fees, $152 per linear foot, or $8,664 in annual rent, are, compared to living in an apartment in the city, a supreme bargain.

It’s also a scenic place to live. Day’s home is a tableau of serenity, with wild flowering plants adorning her deck. A kitten lies balled up nearby. Families motor by in sailboats heading off down the Hudson River, waving hello.

“This is a tight-knit community,” says Day, the boat basin’s unofficial historian, as she unloads groceries purchased just up the road on Broadway. “People grow old and die here.”

The only other marina in New York that welcomes houseboats is Venice Marina in Brooklyn, which has around 30 boats docked. There are also likely a couple of hundred transients who make sailboats their year-round home, with live-aboards allowed at Liberty Landing Marina in Jersey City, just across the water from downtown Manhattan.

Houseboat owners pay no real estate taxes. But live-aboards have to worry about things that land-lovers don’t changing their oil, or the fact that their home might sink in bad weather. Day also must spend several thousand dollars a year in maintenance, insurance and mortgage expenses for an asset that, at best, can maintain its value, but will most likely depreciate over time. Unlike an apartment dweller, she can’t go running to the super.

“There’s no super. There’s no maintenance guy. You’re the maintenance guy,” said Day, who works as a science teacher in one of New York City‘s private schools.

To prepare for bad weather, residents change the oil in the boat engines and add antifreeze. They insulate windows with plastic, break up iced walkways and shovel snow.

Yet things can go drastically wrong, as in December 1992, when a Nor’easter sank several boats and Day and her husband spent three days and nights up to their knees in water. “It’s tough work,” says Day, “and it’s no longer such a great deal.”

Rick Lowe, vice president of operations for Florida-based Eboatloans.com, a nationwide lender that frequently extends credit to the live-aboard community, said one can reap considerable savings by living in a houseboat.

The greatest advantage is in high rent markets such as New York and San Francisco where Lowe says you can get three times the space for about a third of the cost.

Houseboat owners receive the same tax-write-off advantages as real property owners, adds Lowe, although some states tax houseboats as real property while others merely treat it as a recreational purchase and only look to collect a one-time sales tax charge.

However, live-aboards need to have impeccable credit to receive mortgage financing because of higher perceived risk, adds Lowe, whereas a real property owner can have sub par credit.

Mainly it’s adventure and nature’s proximity, not economic considerations, that draw most live-aboards to the water.

Linda Ridihalgh, editor of LiveAboard Magazine, estimates there are roughly 30,000 live-aboards in North American waters.

She said being a live-aboard is not necessarily a less inexpensive way to live.

“It’s possible [to lower one's overhead] but it’s all in how you want to live,” she says. “I know people who live each month on what some live-aboards spend on their cell phones. It’s all a matter of lifestyle, just as it is on land. It’s not cheaper. It’s a different way of life.”

New houseboats can run anywhere from $30,000 to $1 million, depending on what one is looking for.

One can also buy and reside upon used 30-foot sailboats for as cheap as $10,000, and become a “transient” folks who live on boats with V-shaped hulls that are more mobile than houseboats and are less permanent fixtures in marinas. Such live-aboards far outnumber houseboat owners.

Those living on houseboats come from a variety of backgrounds, and even include former real estate agents.

David Blacklock, a former broker with Douglas Elliman, has been living as a transient at the West 79th Street Boat Basin for the past three years during the summer months.

He notes the difference between his former life on land, and his current one on the water.

“You’ve got to realize that a boat is not an apartment,” says Blacklock. “You have to be very disciplined because it’s a small space. You have to realize that the winter months can be cruel.”

Oddly enough, Blacklock likens a live-aboard’s oneness with nature to that of a real estate broker’s experience with the ever-changing Manhattan real estate market.

“Buildings go up, get converted and torn down. You get insight and knowledge of the city as an organic thing,” he says.

Despite the attraction of houseboats for some, live-aboards have few, if any, rights because they are essentially parking their boats along the shore.

Blacklock says that oftentimes live-aboards find themselves beholden to marina managers and municipalities whose economic and political interests don’t include them.

“They don’t want people getting established, getting territorial, getting some kind of proprietary feeling about ‘this is my spot, this is where I live,’” says Blacklock.

“If they can get someone in there with a 45-foot super yacht or a 60-foot motor yacht paying $6,000 for the summer, they’re much happier.”

Albert Levi, managing director of Venice Marina in Brooklyn says houseboats require additional electrical support and sanitation devices and that therefore many marinas simply can’t accommodate houseboats and don’t want to expend additional monies to do so.

Consequently, live-aboards say fewer and fewer marinas are granting them year-round permits.

The live-aboards at the West 79th Street Boat Basin maintain their year-round status only because they staked claims prior to 1997, when the city curtailed year-round dockage to the months of April through October.

Day believes the days of finding a bargain and some nice scenery at the West 79th Street Boat Basin may soon be over. She thinks the city may dishonor the contract’s grandfather clause and will evict them when it sees fit.

“We’re doctors, lawyers, teachers a cross-section of the city and we give back; we’re very active and involved. It’s awful what they’re doing,” says Day, who’s lived at the basin nearly 30 years. “They like to portray us as squatters, but this is a real community.”

New York’s leading real estate families have always been experimenters and innovators.

Whether it was the Rudin family pioneering the idea of wiring older buildings to support high-tech communications a decade ago, or the Tishmans pioneering construction management in the 1950s, they have often led the way.

It’s a small group, this club. Along with the Rudins and Tishmans, families like the Dursts, Roses, Fishers, Resnicks and a few others constitute the ancient tribal order of New York real estate – the families who began buying buildings at the dawn of the 20th century.

Today, they are reshaping the city, even if they carefully avoid the headlines sought by other, flashier developers.

Like their forefathers, they are planning to remake the city – particularly Downtown- in new and innovative ways, with the Tishmans and Dursts seeking to change the city through green, environmentally-sensitive building, and the Rudins through high-tech infrastructure.

Tishman Realty & Construction Corp. built the first World Trade Center, and it’s entirely possible they might be building what goes in its place. The company is currently building 7 World Trade Center for Larry Silverstein, the World Trade Center leaseholder, and a project for Verizon at 140 West St. at Ground Zero.

It’s also likely that whatever will be built at the World Trade Center site will be a green building, with New York Gov. George Pataki referring to the possibility in a speech several weeks ago. Pataki developed a green tax credit that went into effect in 2001, and Battery Park City, right next door, requires buildings be constructed according to environmentally friendly guidelines.

For Dan Tishman, that would be just fine. Tishman is the President and Chief Executive Officer at Tishman Realty & Construction Corp., and a member of the fourth generation of the real estate family that began when immigrant founder Julius Tishman started building tenements in 1898 in New York. The Tishmans were among the biggest builders in Manhattan by the 1920s. In the 1970s, family members split up, with John Tishman, Dan’s father, starting the construction company he still runs.

In addition to building Chicago’s John Hancock Center, Madison Square Garden, and EPCOT Center, to name a few, John is regarded as an innovator who pioneered the field of construction management and created numerous energy (and money) saving products that became the industry standard. One device developed in the 1970s was like an early version of the “The Clapper”, able to automatically turn on and off lights in office buildings, to cut back on the normal practice of keeping them on all night.

“All along, we’ve had the ability to experiment ourselves as a company,” said Dan. “It gives us an advantage in the marketplace.”

Dan, 48, is no less an innovator than his father, and has already made it clear he plans to make his mark in the area of green building. Working under the Dursts, the Tishmans constructed what is widely regarded as the country’s first environmentally-green high-rise office tower, the Conde Nast building at 4 Times Square, completed in 1999. The Tishmans also constructed the Rudin family’s Reuters Building at 3 Times Square, another green project. Dan also helped draft the green tax credit in 2001.

Now, the family company is set to work on the next Durst project, which Dan said will be even more environmentally sensitive. The Durst Organization, led by Douglas Durst, plans to build a $1 billion, 57-story tower on West 42nd Street that will serve as New York headquarters for the Bank of America, once he obtains a few remaining parcels at the site.

“If that happens, we will be the builders,” said Dan, who attended a planning retreat late last month for the project. “It will likely strive to be much better than 4 Times Square. There have been tremendous changes [in green building] since that project went up.”

Like the Tishmans, the Rudins will also likely have a large part to play in Downtown redevelopment. The family began its foray into real estate 70 years ago, when Samuel Rudin began developing residential properties before buying his first office building in 1955. The Rudins were well known for never selling an office building that they built, and the portfolio grew to 40 buildings valued at $2 billion, including 16 office towers in Manhattan. Sam’s son Lewis, who died in 2001, was one of the city’s biggest boosters and a behind-the-scenes power in helping the city through the fiscal crises in the 1970s and early 1990s.

Though not in the least tech-savvy, according to his son, William, Lewis saw where the city was headed, and set Rudin Management on course to become a pioneer in the wiring of older buildings to support high-tech communications. The decision was sealed when Lewis read a newspaper story about a high-tech company considering a move to Manhattan.

“He was actually partially blind,” said William, 47, who became president of the company in 1993. “He couldn’t see but he had tremendous vision. His vision told him that for lower Manhattan and the entire city this was a unique opportunity.”

The Rudins went on to transform 55 Broad St. into one of the world’s first totally wired buildings in the mid-1990s, with features like video-conferencing, and wireless phone and computer networks two years before Wi-Fi standards had even been developed. The company then completed four other “smart” buildings, including 32 Sixth Ave. and the Reuters Building at 3 Times Square. (Paradoxically, however, the company doesn’t even have a central company Web site, only sites for its individual buildings.)

Now, the company is helping lead the way in rebuilding telecommunications Downtown.

Many businesses in Lower Manhattan were shocked when they lost their telecommunications after the Sept. 11 attack. Most thought they had sufficient carrier backup, so that if they lost one carrier, another would keep them in touch. But it didn’t turn out that way.

“What people thought they had on Sept. 10, was very much different from what they discovered they had on Sept. 11,” said John J. Gilbert, chief operating officer for Rudin Management. “What many companies had was three or four carriers, but they were all on the same pipe.” When the one pipe was gone, communications went down with no backup.

Understanding the importance of not letting that happen again, Gilbert chaired a telecommunications users group formed by the Federal Reserve Board, REBNY and other groups, which spelled out the need for a backup wireless system.

A wireless system that can beam data from one building to another through a ray-gun shaped device, using high frequency radio waves, is in the works. What will be constructed are wireless hubs that will be able to beam signals and communicate with “any building within its line of sight,” according to Gilbert. The city currently has a RFP (request for proposal) out for a company to build the system.

William is philosophical about the innovations his family has made. “I’m very lucky. I represent the third generation. I’m very fortunate that I had my father around for a long time and my uncle is still here.”

William is joined by sister Beth Rudin DeWoody and other family members, Madeline Rudin and Eric Rudin, as part of the third generation working at the company. The fourth generation is still in school.

“They were forward thinking people in their time and made sure their buildings had a competitive edge,” William said of the previous generations. “But at that period of time, it was central air conditioning and bigger closets, or intercoms in the apartment, and more modern appliances. We just took that forward.”

Dan Tishman said taking things forward in constructing the first green skyscraper in the nation was a wholly collaborative effort with the Dursts. Jody (Jonathan) Durst, co-president of the Durst Organization, is another strong advocate of green building and a member of a dynasty that got its start back in 1915 under immigrant Joseph Durst. “The core team of the Dursts and [architect] Bob Fox and myself were devoted to making it as green as we could,” within limits acceptable to the developer, Dan said.

Since the Conde Nast building – which was adapted for solar panels, an air delivery system that provides 50 percent more fresh air than the average building, and a network of recycling chutes that serve the whole building – was built, there are now established benchmark standards in place for green high-rise buildings. New technologies and the deregulation of the utility industry have also helped the green building cause.

Dan, who graduated from liberal Evergreen College in Washington State and worked as a teacher and contractor in Maine before joining the family firm, is both a continuation of his father’s ideas and something different. “I have my own ideas,” he said.

He’s fully aware green building is generally not considered cost-effective (“people might pay a tiny, tiny premium to be in a better building, but nothing more than that”), but he said there has been progress over the last ten years. He expects change, eventually, through government mandates, and rising energy costs.

He said he partly agrees with a statement once made by Douglas Durst that a developer needs to see 30 years into the future when putting up a building.

“I wouldn’t disagree with Douglas,” he said. “It’s a six to eight year process to get a project done. But you are also building in real time. You can’t be too far-thinking or you might put yourself out of the market.”

To hear Jerry Morecraft tell it, there is something slightly cloak and dagger about short-term office space.

Clients can show up to rent an office or a suite of offices for as much or as little time as they need, and get access to a receptionist, copy room and other amenities.

Displaced workers come there “because a lot of people don’t want prospective employers to know they are out of work.” Out-of-town companies who have downsized but want to at least maintain an address in New York sign up for space.

Business operations that can’t afford executive suites sign up for “virtual offices” consisting of only voice-mail and a physical mailbox, so “no one from the outside knows.”

With unemployment in the city at 8.1 percent in May, amid a dour economy, it might seem like short-term office space would be thriving with those types of clients.

But like the rest of the commercial office sector, it’s struggling.

Morecraft, who is a vice president and general manager at Executive Workspace, which offers 52,000 square feet of space and 175 offices at 1120 Ave of the Americas, said business “tracks closely to what the economy is doing.”

Besides outplacement offices for those who are out of work, Executive Workspace sees lots of attorneys and CPAs, finance ventures, satellite offices for software companies, start-ups and salesman who “need a place to hang their hat.”

Of course, business has dropped off since the Internet boom. “When the dot-com thing was going strong, we were chock-a-block full, with a waiting list,” Morecraft said.

One of the biggest casualties of the Internet bust was HQ Global, which is still the largest supplier of short-term office space in New York, as well as in the nation. Morecraft’s company was a HQ franchise until June, when it decided to separate from the company.

HQ declared bankruptcy in 2001 after finding itself awash in space and millions of dollars in debt. The company closed three sites last year in Manhattan as part of a court-supervised plan to emerge from Chapter 11. It now operates 12 short-term office sites in Manhattan totaling 440,000 square feet, and eight other offices on Long Island.

“We basically had too much inventory for the demands of the marketplace,” said Eileen Mahoney, an area vice president of service for the metropolitan New York area of HQ. “Some sites were operating right across from one another.”

But because of the consolidation, occupancy rates have actually gone up at HQ offices in the New York area since 2001, from the “high 70s” two years ago to the “low 80s” today, she said. That also means a lot of clients have stayed with the company, she said.

Howard Watler, director of project and operations for Rockefeller Center Business Centers, which operate’s three sites in Manhattan, including two in Midtown and one on Wall Street, said he had seen mixed results recently.

“We’re showing really strong recovery signs in Midtown,” he said. “Wall Street is still lagging behind.”

Different types of short-term office space accommodations vary depending on the company. At Executive Workspace, offices are on the smaller end, ranging from 100 to 300 square feet. Rents are $1,000 to $4,000 a month.

Like at most other company sites, there is a receptionist on duty, and clients can use mail, copy and conference rooms, get lunches catered, and have access to tools like high-speed Internet and video conferencing.

HQ offers larger spaces, up to 2,000 square foot areas that can house 50 employees. Rentals can be set up a matter of hours, and, like at other companies, the minimum stay is generally three months. Rockefeller Center Business Centers offers a maximum of 15,000 square feet of space, according to its Web site, as well as the benefit of a “landmark address” at 45 Rockefeller Plaza, Watler said.

As companies look to boost business, a push is also on to get commercial brokers to refer more business their way. The referral fee is generally 10 percent. HQ has tried to provide more incentive by holding special promotions in New York that raise the rate to 15 percent.

Watler said his company has an “inside track” with Cushman & Wakefield because they are both connected to the Rockefeller Group. But he acknowledges that the commissions brokers get are generally “small potatoes” compared to the other work they do.

Watler hopes, however, that brokers look to short-term office space as an option in “overflow” situations or for use as swing space.

“I don’t think they think of us as much as they could,” he said.

When the Related Companies, Apollo Development, and the City of New York announced a 2.1 million square foot mixed-use development on the site of the old Coliseum at Columbus Circle, it was hailed as a vision of modern design and a fitting home for one of the world’s largest multimedia conglomerates.

One aspect of the project in particular has succeeded in ways that most New York retail real estate professionals would not have expected. The Shops at Columbus Circle as the retail component of the project is being called is 95 percent leased, with a tenant roster that even Rodeo Drive would envy. There will be six levels of retail space all told, two of them below ground.

But will New Yorkers actually shop there? The project has a stellar roster of shopping and dining tenants. But it is certainly no secret that historically, vertical retail has fared poorly in New York Trump Tower and Manhattan Mall are prime examples of how difficult it is to get New Yorkers to move off the street to shop in a multi-level setting. Vertical retail is an obscure concept to the New York shopping populace, who are more accustomed to doing their shopping while strolling along an urban streetscape.

Presumably the center will get built-in foot traffic from the hotel, condos, and office space above. But the area around Columbus Circle has little pedestrian traffic. Furthermore, it’s possible that many of the high-end retailers like Hugo Boss, Tourneau, Armani and Coach that are tenants at The Shops may not appeal to the typical Upper West Side resident. However, several big-box retailers who are part of the diverse mix of tenants in the 300,000 square foot retail component seem a natural fit for the area. Borders Books, Whole Foods Market, and a 40,000-square foot Equinox gym, who are taking space, all seem promising. Borders, a well-run outfit, will face competition from Barnes & Nobles on Broadway and 68th Street, eight blocks away.

Another aspect of the retail component will be restaurants. Haute cuisine has committed to the project, with notable operators like Grey Kunz, Jean-Georges Vongerichten and Thomas Keller all planning to open restaurants on the third and fourth floors of the retail component. Hopes are high that people eating at the restaurant will also end up shopping at Hugo Boss and other retailers on the floors below.

Both Related and Apollo are confident that The Shops at Columbus Circle will buck the trend of how vertical retail has fared in New York. In addition to the location, density and vibrant nature of the project itself, the unique architecture featuring a 180-foot tall soaring glass façde facing out onto Columbus Circle will dramatically showcase the multitude of retailers to passers-by.

Will New York’s notoriously finicky shoppers break with tradition, modify their shopping habits and seek out the destination retailers that have committed to the Shops at Columbus Circle? A long list of highly respected national brands and a group of creative, committed developers are convinced they will.

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Mr. Mendelson is Executive Managing Director of Insignia/ESG Inc. and has been instrumental in completing some of the most important retail transactions in Manhattan.

Irving E. Cohen is Brooklyn born, but he’s adopted New Jersey as a second home. That’s because Cohen had tremendous success developing brownfields in the Garden State.

In the 1990s, Cohen’s firm, OENJ Cherokee Corp. cleaned and sold a 66-acre former landfill in Elizabeth, NJ. In 1998, the 1.3 million-square-foot Jersey Gardens Mall opened on the site, and the project created 5,000 jobs for a struggling post-industrial city. This and other projects made OENJ essentially “the catalyst for the changes in the brownfields mindset in New Jersey,” Cohen said.

Now Cohen’s new firm, Green Eagle LLC, wants to help redevelop a large Yonkers brownfield, but there’s a different obstacle. Unlike New Jersey and other states, New York State is known for creating regulatory roadblocks to brownfields redevelopment.

Now that may be changing. The state Legislature and the governor reached an agreement this year to revamp brownfield regulations and make cleanup standards clear, reform liability and jumpstart work with about $135 million each year in tax credits. After a glitch in June, the bill is expected to become law in the coming weeks.

“I’m smelling a change based on what some of the legislators are talking about and what some of the bills are saying,” Cohen said.

Aside from a new law, there are other hopeful signs for New York’s brownfields.

New York City is creating a brownfield strategy and establishing a revolving loan fund to help developers of the sites. “This administration is really looking much more diligently at the brownfields issue,” said Robert Kulikowski, director of the city’s Office of Environmental Coordination.

A New York chapter of the National Brownfield Association is holding its first meeting Sept. 29 at the Yonkers Library. Robert Colangelo, executive director of the national association, said the chapter is meant to encourage new real estate deals. Last year, President Bush signed legislation to create new brownfield cleanup grants.

Still, some urge caution. The new law would “would still make New York’s program one of the most stringent and non-user friendly in the country,” said Kenneth Kamlet, director of legal affairs for Newman Development Group, LLC, which has brownfield projects in New York. Attitudes will also have to change with regulations, others say.

Proponents of reusing brownfields say it’s an idea environmentalists and developers can love. “I’ve always viewed the brownfield issue as a win-win both for economic development and the economy and the environment,” said Kamlet.

“There aren’t too many issues that one can say that about.”

A brownfield is generally described as vacant or underutilized land, usually former industrial sites on waterfronts or in poor neighborhoods.

Frequently they are only perceived to be contaminated, but developers or banks won’t take the litigation risk.

The brownfield movement is about a decade old and grew out of “superfund” programs established to prevent another Love Canal-type disaster. Unlike superfund sites, people said brownfields were not as polluted and could be reused much easier.

The industry has expanded in the last decade, although its growth is hard to measure. “When a deal gets done, nobody plasters a sign on it, ‘This is a brownfield,’” said Colangelo of the National Brownfield Association.

“Somewhere along the line it starts as a brownfield and ends as a real estate transaction.”

In a 1996 count, New York City found it had 6,000 potential brownfields covering between 3,000 to 4,000 acres, although the real estate market likely gobbled many since then. Nationally there could be anywhere from 125,000 to 1 million brownfield sites, according to the National Brownfield Association.

Proponents say brownfields hold tremendous promise for older,

post-industrial cities in New York and elsewhere. Despite the criticism of New York’s program, 443 brownfield sites in the state have been or are in the process of being cleaned. In New York City, a former brewery is being converted to low-cost housing use in Bushwick and a site in Hunts Point is being turned into a public waterfront park.

New York’s current cleanup program is administrative, meaning that its guidelines are not codified into law. The nine-year-old “voluntary cleanup program” is run by the state Department of Environmental Conservation.

Owners or developers enter into an agreement with the DEC and get a release if the work is completed satisfactorily.

That process won’t change substantially, but experts say New York’s guidelines for cleanup will finally be spelled out in law. Standards can be related to the future use for the site, meaning that the state won’t take the impractical “eat the dirt” approach to every cleanup, said Kathryn S. Wylde, president of the Partnership for New York City.

The bill has incentives for developers to bring land to residential standards, particularly in struggling neighborhoods. But brownfield developers argue that even basic cleanups take the land to a level far above whatever pollution naturally exists. The DEC says it does not know of an existing brownfield cleanup that failed and became a health hazard.

All this makes Cohen excited about his Yonkers project on the Hudson River, which is aimed to be mostly residential. His development team has not been selected yet, but he’s confident the project “could become a poster child” for New York brownfields redevelopment.

Citi Habitats CEO Heiberger leads rentals; on the prowl for apt. sales, retail leasing [more]

What’s in a name?

A lot of work, if you’re a massive real estate company planning to change that name.

In a move designed to unify services under a single brand, Prudential Long Island Realty changed its name last month to Prudential Douglas Elliman Real Estate.

The name change follows the acquisition earlier this year of Douglas Elliman. The combined company now has 50 offices and more than 2,000 agents from New York to Montauk. The Manhattan based Douglas Elliman, an older and more prestigious brand, will keep its name unchanged.

“We have the biggest reach in our industry and hopefully our new name will make it easier for people to recognize us and understand what we’re all about,” said CEO Dottie Herman.

Karen van de Vrande, vice president of marketing and communication for Douglas Elliman, said she was happy the Long Island-based company would be using her company’s name.

“It’s an endorsement of how they feel about the company,” she said. “It’s the best of both worlds.”

Jim Retz, the chief marketing officer for Prudential Douglas Elliman, said there was little overlap between the two companies and that no jobs had been cut.

Three offices that Douglas Elliman operates on the North Shore of Long Island will keep their names unchanged. Prudential’s only office in Manhattan, on 10th Avenue, will have its name changed to Douglas Elliman.

The actual process of changing the name of the Long Island company was a massive process, said Retz.

“We saw a brief window in late June to change everything,” said Retz. “I aged about 12 months when they said ‘let’s do this.’”

Within the space of three days, more than 40 offices on Long Island had their building signs changed. More than 2,000 yard signs stretching across more than 100 miles of Long Island were replaced with new signs. The company had to change the name on 1,300 brokers licenses, business cards, and e-mail addresses, and fix Internet classifieds and advertising.

Within the brief time frame, too, ads appeared in 102 publications distributed on Long Island, from The New York Times to The East Hampton Star. An open house campaign and a $10,000 sweepstakes contest were launched to further spread the word to the public.

The company has also held a number of receptions to celebrate its new identity.

Retz said brokers from the two companies are starting to work together.

“I’m starting to see the combination become more manifest,” he said. “People are referring busiess to each other, and that’s what its all about.”

It has been about five years in the making, but the Internet has finally changed the face of residential real estate advertising in New York.

Online advertising has become the hot new thing for many of the biggest players, even if it isn’t expected to eclipse print advertising anytime soon.

Last year, when the real estate industry spent a healthy $11 billion nationwide on advertising, online advertising made strong gains in a remarkable new trend that saw declining interest in traditional advertising vehicles like outdoor, telemarketing and free- distribution home magazines.

According to figures on U.S. media spending for 2002 released in January by Corzen, Inc., a New York-based online provider of market data for the media industry, online ad expenditure jumped more than 46 percent, from $5.8 billion in 2001 to $8.6 billion in 2002.

“One of the largest changes over the past couple of years is the impact of the Internet,” said Lori Levin, director of advertising for the Corcoran Group.

“Websites have made a big difference in advertising activities through bringing things to the buyers and of course in advertising spending,” said Karen van de Vrande, vice president of marketing and communications at Douglas Elliman.

Industry insiders cite convenience and lower cost as reasons for the appeal of online advertising. Online advertising allows people to look for real estate “peacefully, calmly and casually in the comfort of their homes,” said Andrew Heiberger, president and chairman of Citi Habitats.

Heiberger said classified advertising is very expensive, leaving only the larger firms with the ability to advertise in print. “The reality now is the Internet is the greatest bargain in town, much cheaper than print classified advertising,” he said. “Some companies are 100 percent Internet and can’t afford to run print ads. The Internet reduces the barriers to entry to new business and I think that’s good.”

David Berkowitz of the online subscription-based database service eMarketer agreed, citing the convenience of being able to surf freely and find answers to their questions as a reason many buyers are drawn to the Internet.

The user-friendly nature of the Internet has also been a hit with buyers looking to buy or lease real estate, said Meir Kahtan, a senior account executive at Miller Advertising Agency in New York, which also does marketing for William B. May.

“It’s [the Internet] is a great way for customers to learn about the market and narrow down the property choices,” he said. “The dynamic nature of the Internet, the ability to enter search criteria, pictures and floor plans and the ability to e-mail directly to the broker make it an attractive medium.”

However, online ads are more of a big deal in the ad campaigns of some firms than those of others. The spectrum varies widely, from extensive use of online ads by companies like Corcoran, which says it is visited by more than 25,000 people daily, to companies like Stribling & Associates, which does less online advertising, according to Rosita Sarnoff, the firm’s director of marketing and business development.

Corcoran said Internet advertising brought in twice as many buyers last year as print advertising, with average asking price on apartments virtually the same. Citi Habitats now gets fully one-third of its business through its online advertising efforts, according to the company. Douglas Elliman said it spends about as much on online advertising as it does on print advertising.

Yet for all its new popularity, online advertising has not yet knocked print classified advertising off its dominant pedestal, and perhaps may not do so for a while. At best, far from being a replacement, it has so far only been a supplement to still dominant print classified advertising in the way the advertising budget pie is sliced.

Many of the firms typically advertise in both print and online formats, with each firm’s online advertising benefiting from references to them in its print advertising campaigns.

Commonly, advertisements are placed in both the printed classified sections and the online editions of the same newspapers, with The New York Times classifieds and the newspaper’s website being something of a must-do for the big real estate players in Manhattan. “It [the Internet] has been more complementary, just one more way to promote your product. It’s not going to replace print,” Sarnoff said.

Berkowitz adds that local newspapers like Manhattan’s Village Voice will remain popular as a source of information on real estate availability, especially because it’s available free.

But Heiberger sees a dramatic change in future advertising choices. “I think print classified is going to whittle down to zero and Internet advertising will go up to about 95 percent. But that will be many years away.”

He attributes the present dominance of print over online advertising to sheer demographics, adding that most people over 35 are sticking with printed matter out of habit, and that real estate advertising has had to cater to that habit. But he concedes that such a change is not imminent. “We are not even close to being an e-market yet,” he said.

Kahtan would not bet on that scenario, saying simply that the Internet is an additional channel which is still a very small percentage of total spending, perhaps about five percent or less.

For the moment, online advertising is full of momentum, growing fast and perhaps likely to pull alongside print advertising in time. In the current market, the increased pressure on real estate firms to advertise smarter and more creatively will only increase the tide of Internet use. But online advertising hardly seems poised to pull north of print advertising anytime soon.

It’s mid-July here in Washington, D.C.

In just eight days the House breaks for the summer and the Hill is swarming with activity interns hastily scrambling on go-fer missions, mid-level politicos double checking their Palms while chatting on cell phones, and the major players taking it all in with a seasoned eye.

In the middle of this maelstrom I find an island of respite in Jamie Gregory, Senior Legislative Representative for the National Association of Realtors (NAR). There’s something about his relaxed, yet quietly confident demeanor that lets you know this is someone who not only knows the turf inside and out here, but can navigate it smoothly.

Gregory has been on the Hill for nine years in this capacity and if you’re one of the 900,000-plus members of the National Association of Realtors the largest organization of real estate professionals in the country you’re already somewhat familiar with its keen awareness of and devotion to national legislation. Besides being big, the organization is also very active and well-funded.

“We probably have one of the most active membership bases of any professional organization,” Gregory says.

“Approximately one-third of our members, about 350,000 annually, contribute funds specifically for PACs (political action committees). And it’s clear that the average gift comes not from ‘big wheels’ in the business though those are considerable too but from the average licensee. The standard contribution is $30.”

Gregory is one of six NAR lobbyists on the Hill who work closely with the organization’s policy analysts, administrative staff, volunteers, and a political action committee which handles fundraising.

Anticipating legislative hotspots and working to sway opinion is part of Gregory’s job as a “proactive” lobbyist.

Annual policy goals are outlined at the beginning of a year by the membership base, the Government Affairs staff, and NAR’s governing Board of Directors.

This year, priority issues include the Homeownership Tax Credit, Preserving the Separation of Banking and Commerce, the American Dream Downpayment Fund, Depreciation of Leasehold Improvements, Natural Disaster Insurance, and the Real Estate Settlement Procedures Act (RESPA) Reform.

Although his salary comes directly from a portion of the national membership dues, any monies that Gregory and the other lobbyists have to work with to curry favor with candidates comes directly from contributions marked solely for political action.

In fact, NAR is the largest contributor of individual funds to candidates through its Realtors Political Action Committee and it is NAR’s extremely active membership base which Gregory sites as one of the “three pillars” of successful lobbying, the other two being credible representation, and grassroots involvement.

The other type of lobbying NAR takes on is “reactive” lobbying. When a piece of legislation is passed, such as the National Do-Not-Call Registry, that can impact the industry, NAR’s Government Affairs division goes to work.

Even though Gregory and NAR’s staff lobbied “proactively” during the drafting and revisions of the Do-Not-Call legislation, just before the bill went to the floor for passage, the FCC extended coverage of the National Do-Not-Call Program to include intrastate telemarketing calls pre-empting less restrictive state do-not-call laws.

These state laws often included exemptions for calls by certain professionals, including real estate licensees. Anyone knows the difference between the intrusive “auto-dialed” calls from mass-marketers that come out of the blue and the crucial, targeted calls an agent may make to pique someone’s interest in a property. But the legislation, as currently worded, basically views all calls as one in the same.

NAR’s staff and any other interested parties now have a total of 45 days to try and hammer out differences, reach compromises, and “tweak” the bill.

Today, Gregory starts his day on the Hill just past sunup at a policy input breakfast. From there, he heads to the committee markup session for house bill HR2622, also known as the Fair Credit Reporting Act. “This is a major piece of legislation that’s been a focal point of NAR from the beginning of the year,” Gregory says.

“I attended this morning to make sure that all the elbow grease we’ve put in since the beginning of the session paid off, and to reiterate our position just before it goes to the floor.”

Somehow or another Gregory manages to slip in lunch and then he’s off to meet with a working group (including members from the National Association of Home Builders) on the Affordable Housing Tax Credit.

He winds up his day on the Hill with a sub-committee hearing on the Gramm-Leech-Bliley Act, a key issue to NAR in 2002 and a major win for the organization. Gramm-Leech-Bliley basically purported to allow banking institutions to enter the real estate market. After intense lobbying from NAR and other organizations, the act was tabled for a year. Gregory gets some good news to end his day on the Hill.

One of NAR’s biggest wins in 2002 sticks.

It’s been spreading down Ludlow, Orchard, Clinton, Essex and Eldridge streets. Trendy bars, restaurants and condos have grown up among the souvenir shops and stands selling exotic produce. Immigrant families that have lived for two generations in cramped apartments are now housed next to young professionals in newly renovated million dollar lofts.

Gentrification is coming to Chinatown.

A gateway to America for many immigrants, Chinatown is the most densely packed part of the city. Unrelated immigrant families commonly double or triple up in rent controlled tenement buildings, sharing a single apartment where rooms have been subdivided by plywood partitions.

But that arrangement and the character of Chinatown itself – may be starting to change. Brokers in the neighborhood say owners are looking for any means under the law to vacate their properties so they can fix up their assets and capitalize on them. Community activists are calling for more affordable housing as market rate apartments are added in increasing numbers, and say they are worried the neighborhood will lose its identity.

Douglas Wagner, president of Benjamin James real estate agency, said developers are continuing to come to the area to look for below market rate units to renovate, after having exhausted other downtown neighborhoods.

“There was only so much in Manhattan that wasn’t conquered by market value,” said Wagner. “SoHo moving into NoLita, and NoLita moving into Chinatown has had a domino effect of developers buying buildings, fixing them up and renting to younger, newly affluent individuals.”

Increased demand for market-rate housing has sent prices soaring. New buildings in Chinatown command rents at least four times that of regulated units.

Wagner said market rents in Chinatown are $1,300 to $1,800 for a studio, $1,900 to $2,200 a month for a one bedroom, and $3,000 and up for a two bedroom.

Many of the market-rate buildings are brought about by developers who purchase tenements, wait for the tenants to vacate, move the building out of rent stabilization, and then refurbish the place. A one bedroom can sell for between $450,000 and $800,000, with some Essex Street condo lofts ranging from $800,000 to over a million.

Things have slowed down somewhat since Sept. 11, because of a poor economy, Wagner said.

“I know of a school on Madison Street where classrooms were turned into lofts. That hasn’t launched partially because of the economy, but there are plans to continue at some point. Others have gone ahead,” he said.

Wagner said that slow down makes it the right time to buy in areas like Chinatown.

“This is a really good time for people to consider buying in off- peak areas like Chinatown because sooner or later, or I should say sooner, it will be the area. It’s just a matter of time.”

The renovated market rate apartments are often right next door to rent-controlled apartments, or even in the same building.

Multiple immigrant families often share one rent controlled apartment because the competition for housing is so intense. Conditions in many dwellings have been notoriously poor in the neighborhood for many years, and many landlords have not kept up repairs, according to Robert Weber, the director of policy at Asian Americans for Equality, which helps residents with affordable housing.

Rents are usually $200-$300 a month per person, for a 150 square foot room. A vacated one bedroom apartment made into a three bedroom might market for around $3,800.

In those buildings, both landlords and tenants themselves are dividing up space for multiple families, said Edmond Wong, a sales agent at William B. May. He said tenants don’t see the arrangement as substandard. “They see it as a way to save money. As soon as one family has saved enough money to purchase a home, there are five other families waiting to get in there.”

Within the same building, the physical differences between market rate units and rent controlled units are often negligible, though prices are far apart, said Wong. “There may be two apartments next to each other in the same building that may not be that different in quality, but one is rented at market rate and one is rent controlled, a difference of thousands of dollars.”

The trend towards gentrification is causing concern among community leaders.

Many worry about the lack of affordable housing in the area, and others fear having only high-priced apartments will cause the neighborhood to unravel, leaving Chinatown to become just another tourist attraction, void of its economic and cultural identity.

Alex Chu, president of Eastbank, believes Chinatown needs to create affordable housing, but that it needs to be balanced with the growth of the community.

“There has to be a mixture of housing so you can bring in people with different needs, the high-end and low-end, so they can add to each other to make a strong community. You can’t rely on government to build housing, because the land prices are so high. You can’t even build affordable housing in the traditional sense of the word anymore.”

Chu says one solution might be to build up. “Select buildings on the block that don’t compromise neighboring buildings, and build up to, let’s say, 10 stories from the existing three stories. Add on top of these very sturdy loft buildings, add an elevator, and make it a requirement that 20 to 30 percent be affordable.

“If the landlord wants to do it then they sign on, if they don’t want to they keep their three stories and wait. So it’s still a free society if the incentives are there.”

Weber said the area’s economic downturn following Sept. 11 has made problems ever worse, although he is starting to see some improvement over the last four months. Economists have estimated that roughly 85,000 jobs were lost citywide in direct connection to the attacks, with Chinatown alone losing some 8,000.

“The insularity of the neighborhood, especially after the events of Sept. 11, has heightened the community’s vulnerability,” said Weber. “The jewelry sector, which was the second largest in the city and had done quite well for decades, really took a serious blow and is not recovering right now.”

Weber also noted the current “hemorrhaging” of the apparel industry in the area. And the community experienced fear, anxiety and rumors following the recent outbreak of the SARS epidemic in Asia.

Pockets of elegance and calm amid bustling commercial areas and never the twain shall meet.

That is the traditional notion of Midtown East upscale enclaves like Sutton Place and Beekman Place east of First Avenue, separate from hectic Midtown to the west.

But several new projects have recently brought a little more bustle and other changes to the quiet oasis of tranquility near the East River.

Beekman Place, one of the most sought after enclaves in the city, runs from 49th to 51st Streets, consisting of two blocks of ivy-covered town homes and co-op buildings.

The prestigious neighborhood got its name from the Beekman family, which built its mansion, Mount Pleasant, there in 1764. Townhouses went up in the 1800s. When the sumptuous apartment house at 1 Beekman Place was built in 1929, the cachet of the little street was established.

But there have been changes afoot recently. The tony area saw its first condominium in 1999, when developer Enrico Minoli converted a seven-story townhouse at 25-27 Beekman Place.

Earlier this year, two other condos, the Grand Beekman, a stylish 32-story tower, and the Beekman Regent, a converted schoolhouse, opened at 51st Street and First Avenue, just outside the neighborhood.

But some brokers say residents of Beekman Place, who have long campaigned to keep their special neighborhood unchanged, are welcoming the new developments on their perimeter. The Beekman Regent replaced a vacant shelter that had been an eyesore, and the two new projects are helping to generate new interest in the out-of-the-way neighborhood.

“It’s bringing in more people who didn’t know about the area,” said Beatrice Ducrot, a vice president at Stribling & Associates. “There haven’t been any complaints, and people are excited,” she said.

As far as current Beekman Place residents go, Ducrot said once people move into the area, they tend to stay.

“Beekman Place is a little pocket onto itself. It has addicts,” she said. “You just move from one house to another. I’ve relocated a lot of people there.”

Gale Rundquist, a vice president in Douglas Elliman’s East Side office, notes that just because the area is somewhat out-of-the-way doesn’t mean it’s isolated in terms of services.

“The area east of 2nd Avenue is very highly serviced,” she said. “Compare it to living on parts of Park Avenue, where you have to go over to 3rd Avenue to go to a grocery store.”

Sutton Place, the other tony neighborhood in the Midtown East area, has also seen changes. The tidy enclave that runs from 53rd to 59th Streets between First Avenue and the East River has historically been home to luminaries of all kinds, with current residents including Secretary General Kofi Annan of the United Nations, the movie star Sigourney Weaver and the architect I. M. Pei.

Some brokers say that more young people are moving into the traditionally empty-nester area, including singles and some families.

“Sutton Place used to be pretty dowdy,” said Ducrot. “Now, there are more single people. And families are only now sort of starting to move in.”

Part of the reason young families are moving in despite the drawbacks of being five blocks from the nearest subway are prices that are lower than the Upper East Side.

“You can still get very good deals there,” said Ducrot. Sutton Place is also a draw for doctors who can easily get to hospitals on Manhattan’s East Side and in the Bronx via the nearby F.D.R. Drive.

The neighborhood was named for Effingham B. Sutton, a shipping tycoon, who bought a tract there in the late 1870′s. Sutton Place was relatively industrial at first, but around the time of the opening of the Queensboro Bridge in 1909, prominent families including the Vanderbilts and Morgans started to move in, establishing the neighborhood’s cachet.

Another Midtown East neighborhood, Turtle Bay, which Ducrot calls “a little less selective” has also seen changes in recent years, though less welcome than changes in Beekman or Sutton Place.

The neighborhood, which extends from 43rd to 53rd Streets, and eastward from Lexington Avenue to the East River, is home to diplomats, doctors and business people who want to be close to their Midtown offices. Turtle Bay Gardens, at 49th Street, was born in the 1920s when the area was popular with the literati, and was the residence of Katharine Hepburn and still home to Stephen Sondheim.

“Overall, the area is a mix,” said Ducrot.

“It’s a lot of rentals people who are relocated. It’s got diplomats, but also people who were born and raised there and lived there their whole lives.”

Two of the most prestigious addresses in the area are 860 and 870 United Nations Plaza, on 49th Street. 100 United Nations Plaza, where Walter Cronkite lives, is also high on the list.

The biggest development in the area in recent years has been the Trump World Tower, a 72-story, 360-unit condominium tower that is the tallest residential building in the world.

The community fought the building’s development, and some brokers said there is still some ill will toward the Trump complex. Residents of 100 U.N. Plaza feel the building took away their views.

Rundquist said the mammoth tower has “taken away from the little stores” in the area.

With the completion of the Trump World Tower, some brokers said it is unlikely there will be any more projects of that size going up anytime soon in the area because there aren’t any large parcels for development. But Ducrot said she has heard that some assembling of properties on 2nd Avenue in the 50s might be taking place.

As far as the rest of Midtown East, Ducrot characterizes the neighborhood that runs down 2nd Avenue in the 50s, and is home many bars and nightspots, as “undiscovered.”

“Most people think of it as a commercial area. But it’s fun. It’s a neighborhood that’s still undiscovered in my opinion,” she said, noting it is a natural draw for young people.

West of the area, residential units are scarce in the commercial heart of Midtown.