The Closing: Jeff Blau

Jeff Blau (photo by Marc Scrivo)Jeff Blau is president of Related Companies, one of the largest private real estate development firms in the country, with a portfolio valued at over $15 billion. Earlier this year, Related launched MiMA, a 1.2 million-square-foot, mixed-use development on 42nd Street in Manhattan. The company is also developing the 26-acre Hudson Yards, the largest development site remaining in Manhattan, with plans for up to four corporate headquarters, a retail complex, a hotel, a public school and nine residential buildings.

What is your full name?

Jeff Todd Blau.

Date of birth?

4/11/68.

Where were you born and where did you grow up?

Born in New York City, lived in Bayside [in Queens] until I was 9, and then moved to Woodbury on Long Island.

What did your parents do?

My dad was a contractor, a builder, in New York, and probably got me started liking real estate. I used to work on construction sites over the summer. You know, if you’re in real estate you have to love the physical building side of it. It’s more than just finance and dollars.

What kind of kid were you?

I wasn’t the best student. I didn’t particularly love school — I liked doing things on my own outside of school.

What did you do outside of school?

I had a whole bunch of businesses growing up, from flea markets to paper routes to lemonade stands. [In college at the University of Michigan], I bought some houses and converted them into student apartments with some local guys there.

How did you meet [Related Chairman] Stephen Ross?

He’s a Michigan grad. He was up for a conference, and the head of the real estate department introduced me. We wound up sitting together in the back row at the conference, talking, and he offered me a summer job.

What did you say to him that made him want to spend so much time talking to you?

I think we were probably talking more about Michigan football than anything else. We just hit it off. I actually give his secretary more credit because he was difficult to get in touch with afterwards, and I kept hounding her. It’s always good to know the secretaries.

You [and your wife, Lisa] just moved in to a $21.5 million penthouse at 1040 Fifth Avenue, a co-op built in 1930. Why not live in a Related building, like Superior Ink?

I actually just moved to 1040 from a building Related did build on 65th and Third Avenue, the Chatham. I loved living in that building — the apartment was great. It’s sad to move out, but as two kids come along and you need more space, we opted to make the move.

Your apartment at the Chatham is on the market for $18.9 million. Isn’t that pretty ambitious?

Not really. It’s the penthouse in the building. … I designed it myself when we built the building. If you put it in the realm of 15 Central Park West and the Plaza, and any of the penthouses with great views and terraces, it’s a price that’s consistent.

How old are your kids?

The young one’s nine months and the other one’s three. The three-year-old is really into cars and all sorts of boy things.

How do you balance work and young kids?

I see the kids in the morning. I usually don’t see them during the week at night, and then on the weekends, it’s all about the kids, 100 percent. It’s a trade-off.

Before you bought at 1040, you had a board turndown at an exclusive co-op 820 Fifth Avenue. Why do you think you got turned down?

Technically it never went to the board, so it’s unclear.

Why even bother with a fancy co-op — why not live in a new condo, especially since you build them for a living?

I agree with you — I think that goes in the “lessons learned” category.

Is there any one development that you are particularly proud of?

Of course, the Time Warner Center was really a game-changer for us. … [Also], I think the first real development that I did was a very small building on the north end of Union Square, the Barnes & Noble building on 17th Street. … I remember when we went in and it was an abandoned shell of a building, and there were pigeons flying through it.

What kind of rents are you getting at MiMA?

We’re averaging about $75 a foot.

That building has a “pet spa” — didn’t pet spas go the way of the real estate boom?

It’s not just a pet spa; they do dog-walking, so they’ll come up to your apartment during the day and get your pets, and feed them, and let them play outside. It’s been a tremendous leasing tool. People really love it.

Do you have a dog?

I don’t. I had a dog growing up, but I don’t live in a building that has this feature [laughs].

What is a mistake you’ve made in your career that you’ve learned from?

There are times when the best thing to do is not do anything, when the market gets overheated. In the ’06-’07 timeframe, there were plenty of deals that, had you gone on vacation, that would have been the best outcome.

Related agreed in 2008 to a $1 billion long-term lease with the MTA to become the developer of Hudson Yards. How did you decide to take that gamble?

Well, Hudson Yards could be our greatest accomplishment yet. It’s the future growth corridor of the city. It’s where companies are going to go. Our office building stock is old here. … We’re falling behind as a city. … Obviously [the project] didn’t start as quickly as we’d like, but in the last 12 months or so, I’d say the mindset of the large companies has changed dramatically. … And what you’re seeing now is that people have the confidence once again to make that type of [leasing] commitment.

Related has said it needs a large tenant to begin construction. What’s the latest leasing update?

I believe we’ll start with two 2 million-square-foot office towers and 1 million square feet of retail, and we’ll announce those commitments within the next 12 months.