The changeover has, of course, been a long time in the making. Spinola, an industry veteran who has been leading REBNY for 30 years, announced a year ago that he would be leaving the job. Banks — a well-respected top government affairs director at utility giant Consolidated Edison — meanwhile, was named the new REBNY chief in December and began transitioning into the role in March.
But nobody could have predicted all that has happened since Banks’ appointment was announced.
Not only did the state legislature just wrap up one of the thorniest political sessions in recent memory, with the real estate industry taking center stage in a battle over the controversial, developer-friendly 421a tax abatement and rent regulation, but the industry is also at the center of an ongoing political scandal.
On the legislative front, Gov. Andrew Cuomo and lawmakers announced the framework for a deal that would extend rent regulations and 421a for the next four years. However, the tax abatement extension is contingent upon hashing out key details in the next six months.
The short-term 421a solution means that developers are left with a lot of uncertainty, leaving Banks to handle a major hot-button issue at a time when he’s still learning the ins-and-outs of the industry.
“I’m sure REBNY would have liked to have 421a done, but it lingers now,” said Dick Dadey, executive director of the government watchdog Citizens Union, who has followed Spinola and Banks through the years. “It will be up to John to complete the strong work begun by Spinola.”
Dadey added that while Banks is a seasoned and well-respected lobbyist, stepping into an executive role at such a powerful and diverse organization will be a test for him.
And Banks acknowledged as much at a REBNY event last month. “If I had to say one thing, it’s been getting to know the industry and the people,” he told a group of reporters. “Getting to learn everybody’s name, that’s probably the most difficult thing.”
“There’s so many different players in the industry that I’ve never been associated with before,” he continued. “And [getting] to know their issues, that’s been a lot of hard work.”
Banks has, however, been doing just that.
He’s attended REBNY events and he and Spinola also spent the latter part of June in Albany, where they met with and lobbied lawmakers together.
Banks is, of course, no stranger to city and state politics. He has deep ties with top lawmakers in Albany and with Mayor Bill de Blasio, whose 421a plan REBNY has backed.
Still, if winning a more permanent deal on 421a were not a tall enough task, Banks will also have to deal with the continued fallout from the scandals involving former Assembly Speaker Sheldon Silver and former Senate Majority Leader Dean Skelos.
With the so-called “three men in a room” system of passing legislation — a reference to the governor and two top legislative leaders — now upended in Albany, sources say it may be an opportune time for someone new to step into the fray for REBNY.
“The new [political] leadership team is going to do it their own way,” said Suri Kasirer, the city’s top real estate lobbyist.
She noted that Banks’ relationships in Albany will serve him well. “It’s a very important time for the industry.”
Both Silver and Skelos resigned from their leadership positions earlier this year after being charged by U.S. Attorney Preet Bharara in connection with political corruption cases involving major New York City real estate players.
The most notable of those players is Glenwood Management — identified only as “Developer 1” in the complaint against Silver — which allegedly hired a real estate law firm run by a former Silver aide in an arrangement prosecutors have characterized as pay to play. Glenwood was not charged with any wrongdoing, but its 100-year-old founder, Leonard Litwin, an industry stalwart and honorary lifetime REBNY chairman, is now forever linked to this scandal and the company’s general counsel Charles Dorego is reportedly a cooperating witness.
In addition, current REBNY chairman Rob Speyer — who along with his father Jerry runs mega-firm Tishman Speyer — is “Developer 2” in Bharara’s charges against Skelos. Prosecutors used a meeting between Speyer, who was also not charged with any wrongdoing, and Skelos’ son as an example of how the lawmaker leveraged his position for personal gain.
A spokesman for Tishman said the company was cooperating with the authorities, and REBNY did not comment.
The charges against Silver and Skelos were born out of the 2013 anti-corruption investigation Cuomo launched (and later abandoned), which was looking into 421a abatements granted to Extell Development, Silverstein Properties, Thor Equities and other top developers.
While Banks obviously did not play a role in those scandals, he will no doubt be dealing with the industry’s reputation in Albany.
So far, Eileen Spinola, Steve’s wife, is the only top-ranking REBNY official who will be leaving as part of the transition. Industry veteran Joseph Barbaccia took her place as head of REBNY’s residential and commercial brokerage divisions. But he appears to be the only new hire on the staff. And it’s unclear if Banks plans to bring in his own team.
What’s also unclear is what kind of public face Banks will put on the real estate industry.
“Spinola had welcomed the role of being a lightning rod and deflecting attention from his board. It’s been part of his job and he’s embraced it,” said John Kaehny, executive director of the government watchdog group Reinvent Albany. “Looking at REBNY from the outside [and] as a major political force, it’s hard to see that having new leadership will change the public perception.”
“We don’t know what the Banks era looks like,” he added. “It’s too early.”