Adam Piore (Getty) and “The New Kings of New York” book, out now
When Adam Piore decided to chronicle how New York turned into a playground for the world’s one-percenters, he knew he needed “narrative mules” — characters whose journeys would carry the reader through the city’s operatic transformations. The natural protagonists for such a sweeping tale were, of course, real estate developers, and thus was born “The New Kings of New York: Renegades, Moguls, Gamblers and the Remaking of the World’s Most Famous Skyline,” Piore’s best-selling new book, brought to you by The Real Deal.
Some mules were easy picks. Take Steve Ross, the megadeveloper and multi-billionaire founder of Related Companies and owner of the Miami Dolphins. Obvious.
Piore’s other choices were more interesting: Kent Swig, the former industry golden boy who had a spectacular fall from grace after the subprime crisis; the Zeckendorf brothers, who emerged from under the shadow of their grandfather to develop the most successful condo in New York history; and Dan Doctoroff, the ambitious deputy mayor who oversaw the rezoning of about 40 percent of the city after 9/11.
“I wanted to understand how a city could change so much and what made that happen,” Piore said in an interview with TRD. “I wanted the narrative mules so I could flash back and tell the story of the city through their eyes.”
This interview has been edited and condensed for clarity.
You had a huge roster of developers you could have chosen from to tell this story. Steve Ross, the biggest developer in the city — that’s a clear first-round pick. But you also picked an Icarus-type character in Kent Swig.
Swig, to me, was fascinating. He’s from a real estate family. His father partnered with the Zeckendorfs, who are also characters in the book. He married Harry Macklowe’s daughter. He lived in the most prestigious co-op in the city, 740 Park Avenue. But when the subprime bubble burst, he was the poster child for that calamity. His credit cards were frozen, his creditors came after him. He had these recourse loans.
So I wanted to know what it was like for him. And he’s an articulate guy who speaks from the heart. He came to the city in the ’80s. His earliest deals were with Macklowe around Times Square. So I was able to review the history of the city there, but he also played a role in the revitalization of Downtown in the late ’90s. So I thought he was a good character. I wanted to talk about what it’s like to get wiped out and how that happens.
He probably had the most dramatic reversal of fortunes. At 740 Park, he would say hello in the lobby to David Koch or Steve Schwarzman. He went from that to having his lenders give him a credit card so he could buy groceries from Trader Joe’s — that’s how far he fell. You don’t think of these people as being subject to the same forces as the rest of us, but in some cases they could be.
Kent Swig (Getty, iStock)
He had all these lenders squabbling over his assets and they froze his credit cards. I didn’t know he would share that, but I did know that he had been attacked with an ice bucket by Yair Levy, and that the incident — which had occurred right before Lehman Brothers crashed — was held up in the media as what everybody thought was going on behind closed doors at the time.
You’ve covered the high-flying worlds of both finance and big-ticket real estate. Do you think because real estate is essentially still an industry of cowboys, privately held firms, that the behavior and the ugliness tends to be even worse than some of the stuff we see on Wall Street?
It doesn’t seem like somebody would get clubbed with an ice bucket on Wall Street. But who knows. “The Wolf of Wall Street” was financed by Jho Low, Steve Witkoff’s partner, and it had that guy [Jordan Belfort] on Quaaludes crawling through the middle of the street.
I tried to get the Wall Street angle, too, by talking to Fortress. They don’t usually give interviews, but I got to know a couple of the people at the center of those deals.
One of the ways that you make a lot of money on Wall Street and survive is by protecting your downside. And it doesn’t really seem like people in real estate necessarily do that as much [laughs].
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Fortress would go into distressed situations. [Fortress’] Pete Briger and Steve Stuart came up together at Goldman Sachs and were wading through the wreckage after the S&L crisis, looking for things they could sell. And one of the first things they did was to find out, in a worst case-scenario, how much they could sell it for and who the buyer would be. And that’s what they did with Harry Macklowe. We have that in the book where he calls up and says, “I need to borrow a billion-two, and I need it by next week.”
Steve Stuart hangs up and turns to the guy next to him and says, “You’re not going to believe the deal Harry wants to do.” It was very interesting to me to talk to him and the other people at Fortress about how they then went about doing that. They basically went over to Macklowe’s office and went through his books to identify which assets they could seize if he defaulted on the loan. And they made sure the money was there and which of the assets were already owned by other places. And so their whole approach is, they’re looking for opportunity, but they’re also looking for the downside.
“He had all these lenders squabbling over his assets and they froze his credit cards.”
Love that. You write about when they go to Macklowe and are going through his books, they realize that — and this is one of the broader themes in the book — he was structured very much like a mom-and-pop business.