Park 51 developer upbeat, other real estate pros mixed on market at TRD forum

TRD New York /
Oct.October 13, 2010 11:45 PM

Event panelists included Ian Schrager, Daniel Tishman, Jeff Blau, Robert Knakal,  Howard Lorber and Diane Ramirez


Top: panelists at the The Real Deal Forum, from left: Robert Knakal, Diane Ramirez, Howard Lorber, Brian Sullivan, Jeff Blau, Dan Tishman and Ian Schrager; bottom: the crowd listens in (credit: Michael Toolan)
 

Park 51 developer Sharif El-Gamal did not mince words in discussing Sarah Palin tonight at The Real Deal’s sixth annual forum, “The Road to Recovery” at Lincoln Center.

“She’s from Alaska — what does she know about New York?” said El-Gamal, CEO of Soho Properties, noting ironically that Palin, the former governor of Alaska and Republican nominee for vice president, was among the most “surprising” of the opponents to El-Gamal’s proposed Park 51, a community center and Islamic prayer space two blocks from the World Trade Center site.

“Especially when she decided to tweet about it — I didn’t get that,” he continued. “I hope she never becomes president.”

A Q & A with El-Gamal kick-started the forum, attended by some 1,400 real estate professionals. It was followed by a panel discussion featuring hotelier Ian Schrager, CEO of the Ian Schrager Company; Daniel Tishman, chairman & CEO of Tishman Construction; Jeff Blau, president of Related Companies; Robert Knakal, chairman of Massey Knakal Realty Services; Howard Lorber, chairman of Prudential Douglas Elliman and Diane Ramirez, president of Halstead Property.

When asked if he would move the community center for the right price, El-Gamal emphasized that Park 51 at this point “is not about money,” saying, “I’ve been offered so much money for this real estate.”

Instead, he said, the project “is about doing the right thing as an American.”

He added that he views the project as a valuable opportunity to help change public perceptions about Islam. “There have been extremists who have hijacked my belief system,” he said. “This is an opportunity for us as Muslims to get our identity back.”

Meanwhile, he said he did not feel he overpaid for a West 27th Street commercial building he purchased for around $420 a foot in 2008, saying he would do a similar deal “immediately” if presented with the opportunity.

Other speakers struck a more pessimistic note about the state of the industry.

“I don’t think it’s going to get much better for a while,” Lorber said. “Could be three years, could be five years.”

Ramirez said that while the market is “stable” and “recovering,” she is “seeing no urgency in the market right now.”

Related is now beginning to reconsider some development projects it put on hold during the downturn, Blau said, but the company won’t have new construction starts in New York City for at least 18 months.

“It’s going to take a while before the economics of development truly work again,” he said.

However, he noted that there has been a “tremendous amount of corporate interest” so far in the company’s Hudson Yards project, and Related is working with several potential tenants who would look to take more than 1 million square feet of space. The first construction at the site could be within 24 months, he said.

Schrager, however, was more upbeat, saying that he is working on putting together deals for new hotels. “I think this is the time to start looking for hotels,” he said, adding that there’s “always an opportunity for something special and unique.”

The hotelier, who just made a reported $25 million selling his stake in the Gramercy Park Hotel, said he is looking at opportunities at the lower end of the hotel market, with rooms for “a couple hundred” dollars a night that will be “very stylish, very exciting, and more than just a place to sleep.”

Tishman said there has been a “real hiatus” in private development, but firms — like Related — are now “restart[ing] discussions about projects they put on the shelf.”

In the meantime, he said, construction companies like his have kept busy with publicly funded projects. (Tishman Construction is serving as Construction Manager for One World Trade Center.) “There’s been a huge resurgence of that type of work around the country,” Tishman said.

Knakal opined that until job creation improves, the market won’t see a true recovery.

“We have a long way to go,” he said.

He added: “clearly, the market is trying to find its footing and is really not quite there yet.”

Audience members — which included architect Costas Kondylis; Frederick Peters, president of Warburg Realty; Paul Massey, CEO of Massey Knakal; and Dottie Herman, president and CEO at Elliman — didn’t all share the speakers’ glum outlook.

Raphael De Niro, a managing director at Elliman, said after the forum that he disagrees with Blau’s outlook on development. De Niro said he feels now is a good time to build, and he is currently working on a deal with developers to build a condo at a two-story knockdown site in West Chelsea, adding that Related is “in a box” because they do all their brokering in-house.

Developer Joseph Moinian said he also tries to keep a sunny outlook — and sometimes does too good a job. “My problem has been, I’m too positive, but you need to take the risk.”

Moinian said his firm is currently “putting a lot of emphasis in residential [rental developments]. It’s the bread and butter of New York City.”

With additional reporting by Sarabeth Sanders and Amy Tennery


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