New York City is known for its loud, splashy developers. But quieter landlords often have equally valuable holdings. The low-profile Ponte family, for example, started buying parking garages, former warehouses and auto shops in northwestern Tribeca in the 1960s. Today, the family owns at least 30 properties in the now-trendy area, according to public records.
The family’s firm, Ponte Equities, has rarely sold or developed any of its properties over the years and is sitting on a goldmine today, industry experts said.
“They have just an unbelievable portfolio of properties, but they haven’t been operated at their highest and best use, so there’s tremendous potential,” said Bob Knakal, chairman of Massey Knakal Realty Services, a commercial brokerage that specializes in property sales.
Until now, the Pontes’ lack of activity has kept them mostly out of the spotlight, with one notable exception: In the 1990s, family patriarch Angelo Ponte and his son Vincent pleaded guilty to corruption charges in connection with their waste management business.
Recently, however, there’s been movement in the Ponte portfolio.
In a joint venture with the Pontes, developer the Related Companies has plans to build an apartment building at 460 Washington Street, a massive site that the family has controlled since 1976, according to city records. Related officially declined to comment on the deal, but a source at the company said construction will begin early next year, though it’s unclear if the building will be a condo or rental.
When completed, the new building will face Truffles Tribeca at 34 Desbrosses Street. That 15-story, 290-unit rental complex was built in 2009 by the Jack Parker Corporation on land leased to them by the Pontes.
And a new hotel from prolific hotel developer Sam Chang is planned for a Ponte-owned site at 2 Renwick Street. Chang told The Real Deal that he and partner Barone Management are leasing the land from the Pontes, though he declined to comment on the terms of the deal. Construction is underway on the hotel, which will have 160 rooms when it’s completed in 2014, according to Barone’s website.
Brokers said the Pontes have occasionally sold properties over the years, but this flurry of activity is the most movement they’ve seen from the family.
“They just held most of their properties for years,” said Sean Turner, a broker with Stribling & Associates and a longtime neighborhood resident. “This latest wave of activity is more significant.”
It’s not clear what exactly has prompted the family to make changes. Calls to Ponte Equities’ New York office at 268 West Street went unanswered, and Vincent Ponte through an intermediary declined to be interviewed.
Some landlords and brokers, who asked to remain in the background so as not to jeopardize business relations with the family, speculated that patriarch Angelo Ponte, who is in his late 80s, wants to divvy up the family holdings before he passes away.
Others said the firm is looking for deals out of fear that capital gains taxes will climb in the next few years, which could reduce the proceeds from any sale.
Another theory is that with Manhattan land prices at record highs, selling or developing property has become an increasingly compelling option.
In fact, land in Manhattan south of 96th Street is now selling for an average of about $382 per buildable square foot, up from $350 a square foot near the peak of the market in early 2008, according to Knakal.
Since the Pontes first amassed their portfolio, land prices have “skyrocketed,” Knakal said.
In particular, North Tribeca has taken off in recent years, with swanky new condo developments like the Laight House and 71 Laight Street and 429 Greenwich Street, where the five-bedroom penthouse sold last winter for $15 million, according to the listings website StreetEasy. A four-bedroom there is currently listed at $12.5 million, the website shows.
Family history
In some ways, the Pontes’ empire looks much the same as it did in the 1960s.
The family owns mostly industrial properties, including garages, warehouses and parking lots, but it also has a handful of small residential rental buildings.
The heart of their holdings is the block bounded by West, Desbrosses, Washington and Vestry streets, where the Pontes control all but one property, records show.
At 39 Desbrosses Street, Angelo Ponte opened a red-awning-lined Italian restaurant in 1967. Called Ponte’s Restaurant, the eatery was Tribeca’s first dining destination, according to the eatery’s website.
Other Ponte holdings include 511 Canal Street, a six-story Beaux Arts office building which previously housed the company’s headquarters. It is now home to Oscilloscope Laboratories, the film company founded by late Beastie Boy Adam Yauch, and Tribeca Lighting, which rents lights for weddings.
There’s also 444-446 Greenwich Street, a row of low-slung garages between Vestry and Desbrosses, as well as the former Don Hill’s club at 511 Greenwich Street, which closed in 2011. The one-story brick building, which Ponte has owned since 1974, according to city records, is now covered with graffiti. Now that the club is closed, some brokers expect it to hit the market soon.
Most of the Pontes’ properties appear well-kept, but the exception may be 480 Greenwich Street, a three-story red-brick building erected in 1819. The building has been so run-down for the past few years that the city’s Landmarks Preservation Commission, which designated it a historic property, threatened to sue the family for demolition by neglect, though a permit has recently been filed to repair it, a LPC spokesperson told TRD.
Next door, the Pontes own 504 Canal, an early-1800s residential rental building with ground-floor retail. That property, too, has run afoul of Landmarks. The commission recently issued a violation against Ponte Equities for its failure to maintain the façade, the spokesperson said.
That neglect has reportedly rankled some local residents, though others speak highly of the Pontes, saying they’ve treated the many artists who have lived and worked in their buildings well.
“They always kept rents low,” said local landlord Jacques Capsouto, “and when they did push the artists out, they were quite gentle about it.”
The Pontes haven’t just been real estate investors.
In fact, V. Ponte & Sons, the name that appears on many old deeds, was once one of the largest commercial trash haulers in New York. For years, the company was rumored to have ties to the Mafia, including the Gambino and Genovese crime families.
In the mid-1990s, the Ponte family was the target of an elaborate sting operation, resulting in Vincent Ponte pleading guilty to offering bribes to an undercover detective in connection with the waste management business.
At a diner in Soho, Vincent allegedly slipped the detective an envelope stuffed with $5,000 in cash. Later, at a Tribeca restaurant, came another bribe, also for $5,000.
In 1997, before their trial began, Angelo pleaded guilty to corruption and spent two years in federal prison. Vincent, meanwhile, received probation.
Both were also permanently banned from working in New York’s waste management business.
But the Pontes have been victims, too, of a swindle by Raffaello Follieri, the Italian real estate entrepreneur who was romantically linked to actress Anne Hathaway and later imprisoned for fraud.
Vincent Ponte invested $300,000 with Follieri in the early 2000s, according to the magazine Vanity Fair, and apparently later let Follieri drive his white Mercedes.
Ponte never recovered the money, the magazine said.
Change in direction
Since leaving their Manhattan trash hauling business behind, the Pontes seem to have taken a more active role in managing their real estate.
In 2005, they sold a collection of contiguous lots at 15 Renwick Street, which they’d owned for 25 years. Under new ownership, the site fell into foreclosure during the recession. It’s now being developed as a condo by Izaki Group Investments and Glacier Global Partners.
A hint of the uptick in activity is that Vincent, now nearly 60, has been seeking counsel from prominent real estate attorneys regularly; Jay Neveloff, a partner at Kramer Levin Naftalis & Frankel, told TRD last month that he now speaks with Ponte almost every day. (Neveloff declined further comment.)
But the family seems unwilling to truly let go of many of its holdings. That’s evident by the fact that they’ve leased sites to Chang and the Jack Parker Corporation, rather than selling them outright.
One broker who has worked with the family said leasing is a smart strategy in the current tight lending market, when developers can’t get big loans to buy property and build on it. Leasing is “what you do when nobody is lending,” the source said.
In the meantime, the landowner gets to improve the quality of the industrial parcel with a new building, which enhances its resale potential down the road.
In the end, though, the possibility of paying more taxes on land sales in the near future may be the more relevant driving force, said Ivan Hakimian of the commercial brokerage HPNY, who was speaking about family sales in general and not the Pontes specifically.
“Capital gains taxes are going to go up,” he said, “whether we like it or not.”
They may have chosen the right time to take action. Turner, for one, sees sales prices continuing to rise in North Tribeca.
“The great news for all of Tribeca is if these new buildings come in at $2,000, $2,500 a foot, they will raise the value of everybody’s property,” said Turner, who has lived on Greenwich Street for 12 years. “It will be a benefit across the board.”