The Forest City Ratner exec could be elevated to CEO this month, and industry sources say they expect big things
No one can say that MaryAnne Gilmartin isn’t battle-tested. For years, she has served as chief lieutenant to Bruce Ratner in the fight to develop Brooklyn’s controversial Atlantic Yards project, a clash marked by lawsuits, bad press and angry protesters.
So when news broke in late January that Ratner was planning to step down as CEO of Forest City Ratner, the company he founded, sources pointed to Gilmartin as his most likely successor.
“When you have been through what they have together, when you face the opposition they have, either you end up with an unbreakable bond, or you end up never speaking with each other again,” said CBRE Group’s Tri-State CEO Mary Ann Tighe, who’s worked with both of them over the years. “There is a deep respect there.”
While Forest City’s Cleveland-based parent company issued a statement saying it had “no definitive announcement to make” regarding leadership succession, a source close to the company said while the publicly traded company must comply with disclosure regulations, Gilmartin’s promotion could be officially announced as early as this month.
The company said, however, that even “under any potential leadership succession planning,” it expects that Ratner “will remain deeply engaged and involved in the business.”
Sources say that’s likely to mean that he will serve as chairman, while Gilmartin, 48, will take over all daily responsibilities at the firm, including overseeing the construction division, making personnel and budget decisions and managing the relationship with the parent company.
Over the years, Gilmartin has gained a reputation as a well-connected and savvy deal-maker, a rising star with a laser focus. Already one of the most powerful women in the New York real estate industry (see related story, “Dismantling the boys’ club”), this promotion catapults her into a new stratosphere.
Indeed, Steven Spinola, the president of the Real Estate Board of New York, the city’s leading industry trade group, said he expects her to take a more active role in the industry’s governance and lobbying activities than Ratner has.
He noted that she is close to many industry players at places like Tishman Speyer, Extell Development and the city’s Economic Development Corporation.
“Bruce has been a good member of REBNY,” Spinola said. “But MaryAnne is much more outgoing in terms of her work, and she has been involved and has a personal relationship with a lot of people. People recognize the fact that she is a woman and believe she is breaking barriers, going through ceilings.”
Both Gilmartin and Ratner declined to comment for this article.
Belly of the beast
When Gilmartin was young, her father left, and her mother moved her and her siblings from Queens to Woodstock, N.Y. In a 2010 interview with The Real Deal, she described her home life as “chaotic,” and said it “cultivated a fierce sense of independence.”
That independence landed her a scholarship to Fordham University. To pay the bills, she waited tables at an Upper East Side seafood restaurant Jerry and Val’s Seafood Café — still managing to graduate summa cum laude and Phi Beta Kappa.
“Everybody should have to wait tables at one point in their life,” she said in the interview. “It teaches you how to multitask and treat people with dignity.”
After graduating in 1986, she enrolled in the city’s Urban Fellows Program, which places young college graduates at local government agencies. Gilmartin chose the Public Development Corporation (now the EDC).
Frank Marino — then the agency’s vice president for government affairs, marketing and public relations — interviewed her for the job and remembers being impressed. Gilmartin was 22, but acted “10 years older,” he said.
“It was the whole way she carried herself, the whole comfort level in herself,” he said. “She was very quick on her feet, very tough-minded and very sure of herself.”
Marino also remembered that Gilmartin listed “tubing” as an interest on her résumé.
“I sometimes still kid her about it — at the end of the interview I said, ‘I gotta ask, what is tubbing?’ and she said, ‘No, tubing! You know when you take a big tube and float down the river?’”
“You could tell from things like that that she was very affable … and had a sense of humor,” he said.
The job no doubt provided valuable experience for her to draw upon decades later at Forest City.
Indeed, Marino’s division required Gilmartin to help prepare the agency for sometimes-rancorous public meetings over controversial developments, mostly in Queens and Brooklyn, and on Manhattan’s then-transitioning 42nd Street.
Soon Gilmartin transferred out of PR and into policy, starting in the “corporate retention group,” said Anthony Mannarino, who was overseeing development for the agency at the time, and now works for Extell.
In the late 1980s, New York City was mired in a recession, facing rising taxes and declining services and many corporations were considering moving away. The division’s job was to convince them to stay.
Gilmartin’s role was to help structure deals for corporations that included tax breaks and other incentives. She worked to keep financial giants Morgan Stanley and Bear Stearns in the city, Mannarino said.
“If you were working on a project or a deal and you needed to get something done quickly, on time and cover all your bases, MaryAnne was the go-to person,” Mannarino said. “That’s what she does. She was very good, very solid.”
The Bear Stearns deal in particular was an important watershed for Gilmartin, he said.
The investment bank had been threatening to relocate to Jersey City, following an exodus of firms that included Salomon Brothers, Merrill Lynch and Paine Webber. To keep Bear Stearns, the city negotiated $27 million in property-tax exemptions and tax credits, and $17.6 million in sales-tax exemptions and power-cost savings.
In 1991, Bear Stearns agreed to move employees from Manhattan to a new $1 billion development off Flatbush Avenue in Downtown Brooklyn.
The development was called MetroTech, and the man building it was Bruce Ratner.
Read all about it
After leaving city government, Gilmartin briefly worked at Grubb & Ellis, advising corporations and developers on relocations. But in 1994, she joined Forest City Ratner as an assistant vice president.
By the time she arrived, she had sat across the table from many of the city’s largest developers and had gained their respect as someone who “knows what they are talking about and understands your position,” said Spinola, a former head of the PDC.
“She did not go over there to cover meetings for other people,” he added. “She went over there to pull deals together and to make things happen. That is what Bruce Ratner brought her over for.”
In her early days at Forest City, she continued to work on MetroTech, directing leasing and then supervising the completion of part of the $56 million New York City Fire Department headquarters. She also worked on Forest City’s $220 million Times Square redevelopment project, in which the company completed a 650,000-square-foot mixed-use project that included a Hilton Hotel, Madame Tussauds wax museum and the AMC Cineplex.
Forest City’s work on the Times Square project was the reason the company was selected in 2000 as a finalist to build the New York Times’ new Eighth Avenue headquarters, said Tighe, who led the developer selection process on behalf of the newspaper. Ratner chose Gilmartin, still a senior vice president, to deliver the presentation.
Forest City was considered the least likely of five finalists to win the job — until Gilmartin led a presentation that “blew everyone away at the Times,” Tighe said.
Not only did she have a “complete understanding of the site” and the complexities surrounding the interplay between the public and private players, she also brought a dramatic flair: Halfway through the presentation of facts and figures, the door burst open and an actor dressed as an old-fashioned newsboy burst in, waving an old New York Times and shouting headlines.
“In someone else’s hands, it might have been hokey,” Tighe said. “But with her, it sent a message: ‘Come with us, we will not only be a success, but we will have fun along the way.’ I remember everyone being surprised and laughing. … They came in underdogs and walked out the clear standout.”
In the end, Forest City was selected to build the 52-story, 1.6 million-square-foot, Renzo Piano–designed structure.
It was around that time, right after Sept. 11, that Gilmartin and her husband decided that they wanted “to participate in as meaningful a way possible in raising our children,” she told TRD in 2010. So they decided that Gilmartin would work and her husband, a former police officer with a law degree, would stay home. That’s when she became the family’s primary breadwinner.
“I slay the dragon every day and my husband is the quiet warrior,” she said. “He nurtures and cultivates our home life. It’s the secret to my success in so many ways.”
Staying on message
That dragon-slaying later meant overseeing the development of New York by Gehry at 8 Spruce Street, the 76-story, Frank Gehry–designed Downtown rental tower. But, of course, it’s Gilmartin’s work on Atlantic Yards — the $4 billion, 22-acre commercial and residential megaproject anchored by the Nets’ basketball arena, the Barclays Center — that she’s most known for.
Atlantic Yards, unveiled in 2003, was already contentious when the company’s point person on the project, James Stuckey, left in 2006 to take over NYU’s Schack Institute of Real Estate. Ratner asked Gilmartin to take over.
It was “right in the middle and we were embroiled in litigation and the project was struggling to get off the ground,” said Stephen Lefkowitz, a partner at the law firm Fried, Frank, Harris, Shriver & Jacobson, who served as Forest City’s counsel on the project.
Lefkowitz said Gilmartin was initially reticent to set aside her other projects and get involved.
“We were very far from having a grip on all elements of the project and putting together a viable structure,” he recalled. “The project needed a lot of help.”
But Gilmartin soon got up to speed and began directly managing it.
In the midst of the credit crunch, she led the charge to raise some $249 million for construction of the residential towers by recruiting Chinese investors eager to take advantage of the federal EB-5 program, which grants green cards to foreigners who invest at least $500,000 in the United States and produce at least 10 jobs in areas of high unemployment.
She also negotiated with angry labor unions when the company chose to pursue modular construction for the residential portion of the project. And she was often leading negotiations with the state, the city and the Metropolitan Transportation Authority.
“She is a very good negotiator,” Lefkowitz said. “She knows what she needs and she is very forceful in the presentation of it. She is very smart in terms of understanding what is attainable and what is not attainable.”
Of course, one of the toughest challenges came earlier on in the process. That was convincing reticent tenants to move — a fight the last holdouts took all the way to the state’s highest court, which upheld Forest City’s right to use eminent domain.
The leader of the opposition movement, Daniel Goldstein, who founded the anti–Atlantic Yards group Develop Don’t Destroy Brooklyn and became the face of the protesters, was the last to leave. Goldstein described Gilmartin as a formidable foe.
“She will do whatever she can to make her company succeed in her projects,” he told TRD last month. “She is cutthroat. I think she probably can be very intimidating to people and that helps in negotiation. It didn’t work on me.”
Goldstein recalled meeting with her in his three-bedroom Prospect Heights condo after he and his fellow holdouts had lost a round in court. He was hoping that she wanted to negotiate. Instead, she wanted to buy him out.
“She was trying to scare me, threaten us,” he said.
Goldstein said the two agreed (at Gilmartin’s request) to keep their discussion confidential. But a few days later, he heard from a friend who lived in Edgemont, the same Westchester town as Gilmartin. Goldstein said the friend’s fourth-grade son was in the same class as one of Gilmartin’s children, and that she mentioned Goldstein during a class presentation.
According to Goldstein, the child told his mother that Gilmartin “is building a basketball stadium and housing for poor people, but a mean man named Daniel Goldstein doesn’t want them to do that.”
“Here she is talking to fourth graders, and she is so on message,” he added. “She will take whatever opportunity she can to bounce the opposition, whether it’s truthful or not.”
Eventually, Forest City Ratner prevailed in court and Goldstein and other holdouts moved, with Goldstein reportedly receiving a $3 million buy-out from Forest City.
Though Goldstein didn’t find “anything charming about her,” he was impressed by Gilmartin’s poise at some of the more contentious public meetings where emotions ran high.
“She was pretty calm and does a professional job,” he said.
Steering the ship
As CEO, Gilmartin will be responsible for running Forest City Enterprises’ New York–based, wholly owned subsidiary.
And the role of the subsidiary is only likely to grow.
In December, the parent company reported that New York City accounted for $149.5 million, or 29.1 percent, of the company’s operating income over the first nine months of 2012. But the parent company is currently engaged in a concerted effort to sell “non-core” assets in “non-core markets.”
It’s made it clear that it considers New York a core part of its portfolio. As a result, Gilmartin’s profile is likely to rise and the New York subsidiary could play an increased role in the firm’s overall bottom line.
One of the largest tasks, of course, is completing the next phases of the Atlantic Yards project, which entails constructing 15 modular commercial and residential buildings. Critics have attacked Forest City for using the promise of Frank Gehry–designed towers and then switching to the lower-budget modular construction, as well as delaying its time line for building residential units, particularly the affordable housing.
The role of overseeing day-to-day construction will remain with Forest City’s Robert Sanna, who will now officially report directly to Gilmartin instead of Ratner. (Up until now, Gilmartin’s role in the project was to oversee issues such as the public approval process, financing and interactions with the public and other partners. Now she will also oversee Sanna’s construction division.)
And there is still work to be done.
“The arena obviously was a great first moment — I can’t stress to people how difficult that project was from a political and construction standpoint and making that work,” said Jed Walentas, a principal at Two Trees Management. “But they still have a huge amount to accomplish in terms of doing the housing and other aspects of the neighborhood. I think they will set a new standard in the area.”
One industry insider, however, speculated that though “she was pretty much already running the show there,” Gilmartin may be eager to “make her own imprint” by taking on other projects as well.
There is already an opportunity on the horizon that industry sources say Forest City may be planning to pursue.
In January, the city issued a request for proposals for the development of Seward Park — a 1.65 million-square-foot, mixed-use project with 1,000 units of housing along with commercial and public space on the Lower East Side.
“I think she is going to go after that,” one source said. “I also think she is going to shepherd through the completion of the modular housing at the Atlantic Yards and I think they are going to expand their reach. For the past three, four or five years, they were bogged down with Atlantic Yards and they really pulled a rabbit out of their hats and passed a major hurdle. Now they are free to expand on other developments in the city.”
Few expect the actual culture of Forest City Ratner to change in any dramatic way.
“I don’t expect Bruce to disappear,” Walentas said. “I personally don’t think that the change in title will shift the dynamic too much. MaryAnne has probably been running that place on a day-to-day sense for some time.”