This month in real estate history

A look back at some of New York City's biggest real estate stories

Basil Paterson on left
Basil Paterson on left

1979: State clamps down on apartment referral firms

State officials proposed new measures to clamp down on apartment referral agencies 33 years ago this month. The efforts followed a surge of fraud complaints against the companies, which sold lists of available apartments to New York apartment hunters.

These referral agencies offered a less expensive way to search for an apartment, allowing users to save the hefty broker’s fee — usually 12 percent of the annual rent. Instead, the user paid the agency an up-front fee, typically between $50 and $100, for a list of available apartments.

But often the apartments were not actually available, the landlord had not consented to being included on the list or the building simply didn’t exist.

In 1979, the state Department of State, then headed by Democratic political powerhouse Basil Paterson, saw a surge of fraud allegations. It received 350 complaints in the first eight months of the year, compared with 500 total complaints in the prior three and a half years.

In response, the state instituted tighter regulations in November 1980. The referral industry began fading away in the 1980s. Today, websites such as Craigslist have supplanted it.


David Ogilvy

1950: Ad giant Ogilvy signals boom for Madison Ave. agencies

The two-year-old advertising agency Hewitt, Ogilvy, Benson, Mather, Inc. leased one floor in a new tower rising on Madison Avenue 62 years ago this month. The lease helped solidify Madison Avenue as home to America’s brash ad firms in the post-World War II era.

The firm — which was founded by David Ogilvy and later became the global ad giant Ogilvy & Mather — leased the 10,567-square-foot 23rd floor of the nearly completed 26-story tower at 575 Madison Avenue, between 56th and 57th streets.

Other advertising firms followed the company to Madison Avenue over the next decade and to Midtown in general.

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Indeed, a 1960 survey by a young Harry Macklowe, then a broker with the firm Julien J. Studley, Inc., showed that advertising firms occupied more space than any other type of business in the area between 34th and 59th streets.

Ogilvy was far from the first ad firm to take space on Madison Avenue. In the 1920s and 1930s with the advent of radio, prominent agencies such as the predecessor to BBDO and the newly merged McCann-Erickson took space there.

However, it was not until after World War II, with the growth of TV, that the street grew into the iconic symbol of the ad industry that is today portrayed in the award-winning show “Mad Men.”


1889: Upper Manhattan eyed for World’s Fair location

William Waldorf Astor

A mayoral board announced 123 years ago this month that the city would make Upper Manhattan the centerpiece of its bid to Congress to win the 1892 World’s Fair.

Mayor Hugh Grant’s “World’s Fair Committee on Site and Buildings” identified a large swath of the city — between 98th and 127th streets from Park Avenue (then known as Fourth Avenue) to the Hudson River — where the site would be located. The actual site would, of course, be just a fraction of that size.

Winning the World’s Fair was akin to winning the Olympics today. It would mean millions of dollars of development along with floods of tourists. In addition, it came with the opportunity to remake a portion of the city that, up until that time, remained largely vacant.

The board included real estate heir William Waldorf Astor — who agreed to allow his Uptown properties to be used for the fair — and R.H. Macy & Co. owner Isidor Straus.

The site selection immediately put real estate speculators in motion buying land in the area. “One man was so eager that he bought four lots that subsequently proved to be within the site area,” the New York Times reported.

But ultimately, New York lost its bid. In February 1890, the U.S. House of Representatives picked Chicago as the site for the fair, which opened in May 1893.