Miki Naftali walks us on white marble floors to an indoor pool at the top of an Upper East Side condo tower. He is eager to talk about the ceiling’s heights.
“I mean, look at the size of the windows here,” Naftali says, pointing to large arched openings that produce unobstructed views, all desired features of the building on East 83rd Street.
Listening to Naftali on the minutia, you momentarily forget he was the guy whose most sweeping deal was buying The Plaza Hotel in 2004 for what was then a record price per room.
Now, the short and upbeat 63-year-old in clear-framed glasses has paid about a record price per square foot for a residential development site at 800 Fifth Avenue, where he plans to demolish the current structure and put up a 26-story Robert A.M. Stern tower for New York’s blue bloods and billionaires.
It’s a project that celebrity broker Ryan Serhant believes will be the one the “world talks about for the next 30 years.”
If Serhant is right, Naftali will be etching his name beside the city’s real estate legends, along with Gary Barnett, the Dursts, Rudins, Silversteins and Elghanayans.
Naftali became a major player in New York real estate seemingly overnight when he bought The Plaza for $675 million while at his former employer El Ad, ruffling feathers of the city’s powerful hotel union and over plans to convert hotel rooms to luxury condos.
That splash laid a foundation for Naftali as a dealmaker – even before final numbers for the Plaza conversion came in. After that, he struck out on his own and did small but successful projects, gaining a reputation as an uptown tastemaker. His buildings are subtle, often with limestone facades, in line with the neighborhood and their residents’ disdain for glass and steel structures favored by New York condo kings. His projects have brought in $1.6 billion worth of financing this year, he said.
“These are not projects that are done in three years.”
Even before 800 Fifth, Naftali had begun doing deals on the level of The Plaza, while also expanding outside Manhattan. He’s bringing 950 residential units to North Brooklyn with a project called the Williamsburg Wharf, a 67-story tower to Miami and a luxury-branded condo to Fort Lauderdale.
“It’s crazy right now,” he said. “In the next couple of years, we have about $5 billion between New York and South Florida to sell, and this is in addition to about 2,000 rental units, right?”
The question is whether Naftali can work on this scale with the laser precision and approach to windows and ceiling heights that have made projects like 200 East 83rd Street so successful. Condo development is always risky, in sway to foreign currency fluctuations, timing and the whims of a few buyers whose complaints about finishes can halt sales.
Naftali combats the uncertainty with diligence. “If you don’t do your research, you have no chance to be successful. And even if you do your research, sometimes you can make mistakes,” he said.
Singles and doubles
Naftali moved to the United States from Israel in the 1980s and studied engineering at the University of Southern California. He got a job at El Ad Properties — run by Israeli billionaire Yitzhak Tshuva — in 2000 and was surprised to be working on straightforward projects out of a nondescript office in Fort Lee, New Jersey.
But he picked up bigger and bigger deals until he purchased The Plaza, which overnight made him a major player.
Naftali had wanted to strike out on his own, but the financial crisis delayed his plans to exit El Ad. In 2011, he opened the Naftali Group.
“People were skeptical, and rightly so,” he said. “So I had to start with smaller properties and start to grow the business and get the confidence [to] tap into investors in equity funds that I didn’t know before.”
Naftali’s first independent deals were a handful of rental buildings in Brooklyn; condos in Gramercy Park, Chelsea and the West Village; and a slew of uptown buildings on either side of Central Park.
“I tend to shy away from the ultra-tall buildings,” he said.
He gained a reputation for luxurious, highly amenitized buildings that catered to Manhattan’s upper crust. While he’s ventured downtown and put up a few glassy structures, he’s mostly known for the quiet limestone look that evokes old money status.
“He’s more of the Robert Stern school of architecture: limestone facades, classic finishes, not really pushing the envelope but more timeless,” Craig George of Sotheby’s said.
George added that while Naftali might not have the international recognition of a developer like, say, Extell’s Gary Barnett, he’s definitely got clout with local buyers: “New Yorkers know his reputation.”
He’s done four buildings so far with Robert A.M. Stern’s office (800 Fifth will be the fifth and, possibly one of the last that the famed architect ever worked on — Stern died last year; see page 56).
Compass’ Alexa Lambert, who’s headed sales on many of Naftali’s buildings, agreed with the developer’s own assessment that the details matter, even if construction is longer and more expensive.
“He bet that people will appreciate it if you do things the right way,” she said. “And so far he’s been both right and lucky.”
“It’s no shortcuts, no noise, no ego,” Serhant said. “That’s the trifecta for creating greatness in the development business, it’s hard to find a developer who has one of those themes, let alone all three.”
Naftali’s character sets him apart from other developers. He’s not brash or physically imposing. When he was working in Israel, he said he felt out of place because people were always yelling to get the attention of contractors or subcontractors.
“He doesn’t think that he knows everything,” said Glenn Grimaldi, the former head of U.S. commercial real estate at HSBC who now works at Naftali.
“I’ve worked with him on a dozen projects over 15 and 20 years,” Stuart Saft, who leads Holland & Knight’s real estate practice group, said. “I’ve never heard him raise his voice, he has authority, he delegates, but he’s not one of these guys when a problem arises he starts screaming at everyone.”
Taking Fifth Avenue
Bernard Spitzer developed 800 Fifth Avenue in 1978 on a prime corner at East 61st Street, a stone’s throw away from Grand Army Plaza at the southeast corner of Central Park.
The building never really fit the location. Built during the financial struggles of the 1970s, units have low ceilings and basic layouts; the facade never stood up to its grand limestone neighbors.
After Naftali went into contract in March to buy 800 Fifth Avenue from Spitzer Enterprises and the Winter Organization for $810 million, Adam Doneger of Newmark took to LinkedIn to announce that it was the highest price per square foot for land ever. Based on square footage from Property Shark, that would put the price per square foot at about $2,275.
Naftali acknowledged the high price.
“We looked at 800 Fifth and we said, there is only one,” he said. This is the only opportunity anyone will ever have to develop such a prime piece of land overlooking Central Park. “We think that you pay a big price for a special property. So, time will tell if we are right.”
The opportunity is similar to what The Plaza offered in 2004. The condos there drew in buyers like Harry Macklowe, Tommy Hilfiger and New England Patriots owner Robert Kraft.
But The Plaza’s conversion had obstacles.
“It’s crazy right now. In the next couple of years, we have about $5 billion between New York and South Florida to sell, and this is in addition to about 2,000 rental units.”
In February 2007, Russian hedge fund manager Andrei Vavilov went into contract to buy two of the project’s condos for $53.5 million. But he sued El Ad, insisting the apartments were “attic like” due to small windows, low ceilings, obstructed views and ugly drainage grates — demanding his $10.7 million deposit back and $36 million in damages.
El Ad countersued, saying the lawsuit was full of false and defamatory statements, and that Vavilov was just trying to get out of his obligation to buy the apartments.
The two sides settled, and Vavilov agreed to buy the smaller of the two units for $11.2 million, which he quickly turned around and sold for a $2.8 million loss.
A number of owners, in fact, have sold their homes for a loss or just broken even.
Hilfiger bought his two units for $25.5 million and reportedly spent another $20 million, combining them into a penthouse. He put it up for sale — at one point asking $80 million — and after 11 years sold it for $31.5 million.
Experts have said that The Plaza’s best sales happened during pre-sales before people could see their units, and resales were hurt by competition from newer buildings like One Central Park South and 432 Park Avenue.
Venture to Brooklyn
As Naftali was selling out new condo towers uptown, he had his eyes on a site across the East River. Naftali was among the many Manhattan luxury builders over the past decade who saw potential in a 3.7-acre site in Williamsburg.
They saw the property as the last undeveloped land site in North Brooklyn. It was owned since the 1980s by Abraham and Isaac Rosenberg, for their lumber business. They had their own plans to redevelop the property but were stalled by infighting within the brothers’ Satmar Hasidic community, where two factions, the Aronites and the Zalmanites, were bickering over the best use of the property.
The Rosenbergs put the property on the market in 2013. HFZ Capital and Vornado Realty Trust both looked at it, according to The Real Deal articles from the time.
But the Rosenbergs discovered that petroleum, pesticides, PCBs and other pollutants had contaminated the site, quashing interest. Three years after that, Isaac died in a drowning accident while swimming off the coast of North Miami Beach.
Naftali said he became friendly with Abraham at some point that decade. In 2019, it emerged that he’d persuaded Abraham Rosenberg to sell.
“It took me about two years to get them to agree to sell it to us,” Naftali previously told TRD.
Naftali could make the deal work, unlike developers who’d been scared off. He had the time and money from a big-money equity partner in Len Blavatnik’s Access Industries to go through the cleanup and remediation process. Naftali paid $180 million in 2019 and $100 million in 2020 for the parcels.
“A lot of [other potential bidders on the site] couldn’t figure out the complexity of a complicated seller counterparty. They also knew that given the amount of buildable square footage that it was going to be a very significant equity requirement,” Jonah Sonnenborn of Access Industries said.
Access also wasn’t worried about a complicated deal. It was the firm, along with Witkoff, which ultimately took over the unfinished XI condo project on Manhattan’s High Line when HFZ Capital collapsed.
Access and Naftali plan to bring a mini-neighborhood to Williamsburg. Williamsburg Wharf will span five residential towers with 500 rental units and about 450 condos.
“In projects that are larger and more ambitious, it requires more patient capital. It requires permanent capital. These are not projects that are done in three years,” Sonnenborn said.
Condo sales have already impressed the industry. Williamsburg is a less tested market than the Upper East Side because there are fewer comps. But Naftali is already setting records. An 89-unit condo portion of the project sold 50 percent as of April, making it the city’s top-selling building, according to Marketproof.
Expansion Mode
Naftali is not a trend follower.
So when his peers started building in Miami Beach and Miami’s Brickell neighborhood in the late 2010s, Naftali stayed put in New York. He missed the wave of wealthy New Yorkers seeking new condos in South Florida during Covid.
In 2022, Naftali saw an opportunity in a less glamorous part of Miami. He joined with Cara Real Estate Management and paid $40.5 million for a 1-acre site in a development site dubbed Miami Worldcenter. The building will be Naftali’s tallest, a 67-story tower with a mix of condos and rental apartments.
In Miami, Naftali’s pitch is similar to that of other New York developers: that he can bring New York-level living to Miami.
“It’s very difficult to get the quality in South Florida and in Miami. I mean, we’re sitting in a building that’s not the most expensive building in New York by any stretch of imagination, but the quality here is really good quality,” Naftali said, gesturing around the East 83rd Street condo’s amenity floor.
“It’s difficult to get it in New York,” he said. “It’s more difficult to get it in South Florida.”
Miamians roll their eyes at these sorts of claims, and Naftali makes clear there are talented developers in South Florida. Still, fewer condo builders are able to meet buyer expectations, according to Naftali.
“Speak with brokers in Miami, and I think the last couple of years, they see it more and more, there is a big difference between some of the projects, between the beautiful renderings at the beginning and the end product,” he said.
Outside of Miami, Naftali is making an even bolder bet in Fort Lauderdale. The city is seeking to change its reputation as a hub for spring breakers and boat enthusiasts, and Naftali is betting on this potential with a 45-story branded condo.
He has also expanded into the debt business, launching a credit arm in 2019 and hiring Grimaldi in 2022. The business focuses on mezzanine loans to other builders.
Miki’s daughter Danielle is head of marketing sales and design — she keeps him on his toes, he said. Together, the two review every offer they get.
“If, God forbid, I don’t see it for five minutes, Danielle immediately texts me and — she doesn’t call me dad, she calls me Miki — ‘Miki did you see this offer?’”
The Cycle
Naftali’s buildings tend to blend admirably into their surroundings instead of standing out like the towers on Billionaire’s Row or those with flashy architecture.
And the same could be said about the man himself.
Yet 800 Fifth will inevitably draw comparisons to the Zeckendorf’s Stern-designed “Limestone Jesus” at 15 Central Park West, the supertalls on 57th Street and, to some extent, Naftali’s Plaza conversion.
(Things did not go well for the last developer who sought to do large-scale condo developments uptown: Ziel Feldman’s HFZ Capital collapsed during Covid, losing historic Beaux Arts buildings such as the Belnord and the Astor to foreclosure. HFZ’s managing principal Nir Meir was indicted in early 2024, accused of masterminding a $86 million fraud scheme in which he allegedly siphoned money out of the project accounts. Meir has pleaded not guilty.)
So what gives the developer the confidence he can pull it all off? It’s the small successes, built over time. The attention to detail that hasn’t wavered as projects have grown more ambitious.
“We started to build it, and now we’re 14 years after that,” Naftali said of what might seem like a fast rise. “So this didn’t happen in a day or a month.”
Naftali also points back to The Plaza. He’s already got the experience, he said.
“I did it back at El Ad.”