Speaker 1: This is Masters in Business with Barry Ridholts on Bloomberg Radio.
Speaker 1: This week on Masters in Business on Bloomberg Radio, I
Speaker 1: have a very interesting and special guest. His name is
Speaker 1: Dan Bieteman, and he is the founder and chairman of
Speaker 1: uh Beetoman Development Ventures. Dan is the guy who, at
Speaker 1: a very young age, was tapped to run the company
Speaker 1: that essentially turned around Bryant Park in New York and
Speaker 1: he literally created a brand new model of managing and
Speaker 1: developing and redeveloping public spaces in a way that is
Speaker 1: effective and cost efficient and doesn't cost the taxpayers anything.
Speaker 1: It's really a fascinating story as to how this came
Speaker 1: about and Brian park begat all these other ventures and
Speaker 1: parks both around New York and around the country, and
Speaker 1: even internationally they've they've worked in Singapore and in Canada
Speaker 1: and elsewhere. I found it to be really a fascinating story.
Speaker 1: And of all the folks we've had on the show,
Speaker 1: if you take the ratio of how well known the
Speaker 1: person is to the impact they've had on on and
Speaker 1: the number of individuals they've impacted, I think Dan is
Speaker 1: the lowest known factor to impact of of anybody. Six
Speaker 1: million people a year pastor Brian Park and it's just
Speaker 1: a jewel of New York. So, without any further ado,
Speaker 1: here is my conversation with Dan Bieterman. This is Masters
Speaker 1: in Business with Barry Ridholds on Bloomberg Radio. I know
Speaker 1: I say this every week. I have a special guest,
Speaker 1: but I really have a special guest who I'm gonna
Speaker 1: describe him as someone who probably impacts more people on
Speaker 1: a daily base is and is less known to the
Speaker 1: general public than any other guest we've had. His name
Speaker 1: is Dan Bieterman, and he is the person, in addition
Speaker 1: to running Bieterman Redevelopment Ventures, is the person who has
Speaker 1: turned Bryant Park and other public spaces around from dangerous
Speaker 1: drug infested crime zones to really Brian Park is the
Speaker 1: jewel of Manhattan. Dan Bieterman, Welcome to Bloomberg. So, I
Speaker 1: I don't want to spend too much time delving into
Speaker 1: your CV, but briefly, Magna cum Laudy at Princeton NBA
Speaker 1: with distinction from Harvard uh focusing at on both public
Speaker 1: and international affairs, and in your undergraduate work, it's the
Speaker 1: nineteen seventies and nineteen eighties, and I'm familiar with Brian
Speaker 1: Park because as a kid, my dad worked on Madison
Speaker 1: and thirty nine and I used to come in and
Speaker 1: visit him, and I was always told, hey, stay away
Speaker 1: from the park. Same thing with me and my father,
Speaker 1: who worked in the Grace Building. So so so that's
Speaker 1: your first introduction to Brian Park. The Grace Building literally
Speaker 1: faces Brian Park. So from that introduction as a kid,
Speaker 1: we go to the nineties, seventies and eighties. The park
Speaker 1: is decrepit, it's filled with homeless, it's filled with drug dealers,
Speaker 1: it's a disaster. You come along, what makes you say,
Speaker 1: I have an idea, let's incorporate unentity to clean this up.
Speaker 1: I was lucky and that it was a great first
Speaker 1: job in the field because I've always wanted to be
Speaker 1: between the public and private sectors. I wanted to do
Speaker 1: public sector work, but not on public sector terms. So
Speaker 1: this opportunity came from the Rockefellers, of all people out
Speaker 1: of nowhere, and the substance wasn't so difficult to come
Speaker 1: up with. The politics were miserable, but we uh got
Speaker 1: it done. It took a decade longer than it should have,
Speaker 1: and now we've had twenty five years to watch the improvement.
Speaker 1: So let's let's back up. The Rockefeller Is obviously Rockefeller
Speaker 1: Center up the street, but that's a good ten blocks
Speaker 1: away or or not eight blocks away. What was their
Speaker 1: interest in Bryant Park other than it was a horrific
Speaker 1: blight in in right in the middle of midtown. It
Speaker 1: was the library bear though most people didn't know the
Speaker 1: Rockefeller Is really viewed it as their institution, much like
Speaker 1: MoMA and other places the New York Public Library. They
Speaker 1: were huge sponsors, hugely involved, and Mrs Esther, on her
Speaker 1: way it was one of her key institutions, on her
Speaker 1: way into a meeting of the trustees, was accosted by
Speaker 1: some drug dealers. Mrs Esther, probably eighty two years old,
Speaker 1: looked like Mrs Esther, and they offer her drugs. So
Speaker 1: clearly the message was old lady, get out of here.
Speaker 1: This is our territory. She was outraged and ran into
Speaker 1: David Rockefeller, first person she sees and immediately after being
Speaker 1: accosted in Bryant Park. Very lucky for me, she says,
Speaker 1: young man, he's probably seventy four at the time. We
Speaker 1: need to do something about this misery. The roughie ends
Speaker 1: outside They just insulted me. Let's fix this. Well, let
Speaker 1: me let me. So you're a young kid at this point,
Speaker 1: how do you get tagged too? By the way, Dan,
Speaker 1: come over here, see this park. It's a mess. Fix it.
Speaker 1: The only reason I got introduced to the Rockefellers is
Speaker 1: Larry Cudlow decided to resign as treasurer of a nonprofit
Speaker 1: development corporation on West Street Street Development Corporation. They needed
Speaker 1: a replacement. The guy who ran that, Fred Pappard, knew me.
Speaker 1: He said, you can do this job. And by the way,
Speaker 1: side benefit is at every board meeting. Jackie Onassis is president.
Speaker 1: You'll get to know where So I said, sounds good,
Speaker 1: No pay, I assume he said, yes, I was twenty
Speaker 1: five years old. He suggested me to the Rockefellers for
Speaker 1: Brian Park because they were looking for somebody who might
Speaker 1: be a candidate to somehow turn around this mess. So
Speaker 1: you're on the Fort Street Development Corps. How does that
Speaker 1: morph into Bryant Park Corporation. When David Rockefeller, the world's
Speaker 1: most effective human being for the last hundred years, Oh yes,
Speaker 1: goes back to his office from the trustees meeting, says
Speaker 1: to the guy who round the Brothers fund, UM, we
Speaker 1: need to just hire somebody to fix this. We don't
Speaker 1: know what to do, but we can't have the library
Speaker 1: be surrounded by drug markets and killings and muggings and rapes.
Speaker 1: So there was a competition. I got the job, and
Speaker 1: then UM had no secretary. Nobody was in an abandoned
Speaker 1: office building because I didn't want to spend the Rockefeller's
Speaker 1: money on rent. And UH came up with a plan
Speaker 1: and the plan was a ninety day labor, but the
Speaker 1: politics were six year labor. It was really brutal. What
Speaker 1: was the plan to turn the bark around? I was
Speaker 1: even though I was young. I said, you gotta have
Speaker 1: models for such a thing. So the best models I
Speaker 1: found were actually something tied to the Rockefellers. Rockefeller Center,
Speaker 1: Disney and rousse Rouse had projects that were turning around cities. UH.
Speaker 1: Disney had done a fabulous job in their parks, and
Speaker 1: I think Celebration Florida was a beginning thought at the time.
Speaker 1: So I went to which which is the Disney residential
Speaker 1: town that was sort of built UM with the same
Speaker 1: thinking behind the Disneyland parks in terms of use of
Speaker 1: use and access in and every detail exquisite. It's really
Speaker 1: a wonderful thing. They never decided to go on in
Speaker 1: the business. So I went to all three companies and said,
Speaker 1: I'd like you, here's a deal. You can run a
Speaker 1: park in New York City. We're going to take it
Speaker 1: away from the drug guys. You guys will be our agent.
Speaker 1: I represent the Rockefellers in the New York Public Library
Speaker 1: and the surrounding real estate owners. Let's get to it.
Speaker 1: And they all said, thank you very much. We have
Speaker 1: better things to do than fight with drug sellers in
Speaker 1: New York City. But on the way out I got
Speaker 1: some useful information, which is I asked them how much
Speaker 1: did they think it would take to run a place
Speaker 1: like this? Well, they said, all of them, about a
Speaker 1: million dollars an acre. So we needed six million dollars.
Speaker 1: It's a six acre park. My chairman was Andrew High
Speaker 1: School of Time, Inc. And he said, how much is
Speaker 1: a city spending now? By the way, I said about
Speaker 1: a hundred thousand generously, and he said, okay, six million
Speaker 1: to a hundred thousand dollar off set. And by the way,
Speaker 1: who's spending the money better Rock Center and Rouse and
Speaker 1: Disney or the City of New York, and I said,
Speaker 1: you know the answer to that. So he said, so
Speaker 1: sixty to one plus a multiplayer of two or three.
Speaker 1: So a D eighty two one is the difference and
Speaker 1: effort going into those eight properties versus Brian Park, a
Speaker 1: public property, And we were off trying to assemble a
Speaker 1: mess of budget to allow us to do all the
Speaker 1: great things we wanted to do for the public in
Speaker 1: New York City. I'm Barry rich Helps. You're listening to
Speaker 1: Masters in Business on Bloomberg Radio. My guest today is
Speaker 1: Dan Biederman of BTV Ventures. Dan's firm is the company
Speaker 1: that essentially turned around Brian Park, as well as dozens
Speaker 1: of other parks around the country and elsewhere in the world.
Speaker 1: Will get to that in a little while, But what
Speaker 1: I want to talk about now is the political process
Speaker 1: of taking what is a public space that's fallen into
Speaker 1: disrepair and has become dangerous and turning it into something else. Uh,
Speaker 1: you said, obviously it took you ninety days to prepare
Speaker 1: the plan and then six years to get the politics settled.
Speaker 1: Explain that, UM. Every everybody leaped in and said the
Speaker 1: idea of a privately managed space, UM and a program
Speaker 1: space was a bad idea. Many of them have never
Speaker 1: been in Brian Park. But the preservation movement jumped in
Speaker 1: with both feet to oppose me. But were they thinking
Speaker 1: you're gonna throw up in an office building and Brian
Speaker 1: or just we're against it philosophically there was There was
Speaker 1: parks in New York at the time, and the Parts
Speaker 1: commissioner said a good thing. At one point he said,
Speaker 1: you know, they don't all have to be managed in
Speaker 1: the same cookie cutter way. Let's try and experiment in
Speaker 1: one of them. Later three, because I took over two
Speaker 1: other parks in New York. But that contingent for the
Speaker 1: preservation world wanted them all to be random managed the
Speaker 1: same way, which was government in charge and government both
Speaker 1: spending and collecting methods, managing the profit and law statement,
Speaker 1: which is not a good recipe for success. So so
Speaker 1: you put together a nine day it took you ninety
Speaker 1: days to put together a plan. What were the key
Speaker 1: points in that plan? We invented something called programming, which
Speaker 1: is an urban parks, you can't really afford Barry to
Speaker 1: let um segments of the park be isolated. Um, it's
Speaker 1: not your Semite National Park where you don't need to
Speaker 1: program it's it's there are. Despite the reduction in New
Speaker 1: York City's crime rate, which we were a key part of,
Speaker 1: there are a lot of idiots walking around who will
Speaker 1: do bad things, scare women out of the park and whatever.
Speaker 1: So we invented programming. And if you walk into a
Speaker 1: park that either that one or the one we did
Speaker 1: in Dallas, the one we did in New York, you
Speaker 1: will see a lot of stuff going on that brings
Speaker 1: people into the park. And the more people were there,
Speaker 1: the safer it gets. The female ratios go up, which
Speaker 1: is a key indicator of park success. So we had that.
Speaker 1: We decided to do some food and beverage which had
Speaker 1: never been in the park. Restaurants and kiosks, um an
Speaker 1: elaborate budget with multiple revenue sources that would allow us
Speaker 1: to really do an excellent job running this almost on
Speaker 1: the scale that Disney Rouse and Rock Center had suggested.
Speaker 1: And um then we've rolled that out across the country,
Speaker 1: but in New York it was hard. Blue state political
Speaker 1: processes are thick, to be kind, and my chairman at
Speaker 1: the time said, somebody asked him about approvals. He said,
Speaker 1: everybody in the Western hemisphere and his brother has had
Speaker 1: to approve this twice, and that's why it took six years.
Speaker 1: It was a novel approach, so you would think that'd
Speaker 1: be a little skepticism from people saying, wait, you want
Speaker 1: who to take this over? But then that raises the question,
Speaker 1: how do you manage a park that size with a
Speaker 1: even in the nineteen eighties, with a hundred thousand dollar
Speaker 1: budget that doesn't pay for sanitation. Even the answers weren't
Speaker 1: that hard to figure out, but the politics were brutal.
Speaker 1: In fact that there was a point at which I
Speaker 1: considered giving up after six years, and I met a
Speaker 1: very bright land use lawyer, Steve Leftwitz, on a train
Speaker 1: and I said I was discouraged. He said, why are
Speaker 1: you discourage? This is going to happen. I said, what
Speaker 1: makes you think it's going to have? And they're fighting
Speaker 1: me at every turn. He said, there are four types
Speaker 1: of projects and they fit on a matrix neatly, something
Speaker 1: I've never gotten. I use it all the time. There
Speaker 1: are dumb projects and smart projects, good ideas, bad ideas,
Speaker 1: and then there are projects backed by powerful people and
Speaker 1: projects backed by powerless people. So he said, you can
Speaker 1: imagine how often bad ideas backed by powerless people happen.
Speaker 1: They almost never get adopted. He said, um, um, but
Speaker 1: this is a good idea back by power. He said,
Speaker 1: this is a good idea powerful people, and good idea
Speaker 1: really good ideas powerless people. Bad ideas powerful people. So
Speaker 1: he said, this is a fabulous idea. Your plan is great.
Speaker 1: The Rockefellers are behind it, so are the real estate owners.
Speaker 1: This is going to happen. Don't get discouraged, stop winning
Speaker 1: and go back to work. So that I needed that
Speaker 1: pep talk after six years of facing the public cross
Speaker 1: speaking of the real estate owners. The buildings adjacent to
Speaker 1: the park above and beyond the appreciation that the rest
Speaker 1: of the city has enjoyed has accumulated an additional two
Speaker 1: billion dollars in value just because of their proximity to
Speaker 1: the part. It was a real eye opener. The guys
Speaker 1: who owned the Grace building initially sold it to try Zekon,
Speaker 1: which then sold it to Brookfield. Um a very nice guy.
Speaker 1: He sat me down, He said, let me show you
Speaker 1: how much money you made this family. He said, really,
Speaker 1: let's let's assume it's about a twenty buck premium for
Speaker 1: Brian Park. Being this's good, he said, I think that's modest.
Speaker 1: But every square foot of our million three square feet
Speaker 1: went up in value over five to ten year period
Speaker 1: by twenty dollars as a result of your efforts. And
Speaker 1: he said, the that goes straight to the bottom line.
Speaker 1: It doesn't cost more to collect more rent. So he
Speaker 1: did the math for me twenty million dollars times one
Speaker 1: point three million twenty six million dollars and then he
Speaker 1: said the cap rate years. The cap rate at the
Speaker 1: time was five. So he said, okay, so twenty six
Speaker 1: divided by point oh five million dollars. He said, how
Speaker 1: much have we invested in this thing? I said, well,
Speaker 1: you guys gave a garden and you've been part of
Speaker 1: our business improvement districts, so I got a million bucks.
Speaker 1: He said, so five twenty x, he said, can I
Speaker 1: tell you we've never had a five X experience? Did
Speaker 1: you happen for more money? To hey, you guys should
Speaker 1: be putting. I told the story my next salary negotiation
Speaker 1: to the other board members and I said, why are
Speaker 1: you fighting me on twenty k This is um. There
Speaker 1: really was a lot of value created. So I now
Speaker 1: tell the story to prospective clients in other cities who
Speaker 1: were thinking of fixing their lobbies or doing other things
Speaker 1: that really aren't that remunerative for the ownership. But you
Speaker 1: take a public space and adjacent to the building and
Speaker 1: it's a home run for every that's a win win
Speaker 1: across the board. And right now in Dallas, we did
Speaker 1: a park, Clyde Warren Park, with the help of a
Speaker 1: bunch of Dallas billionaires. It's very successful and there's a
Speaker 1: real estate boom around it. It's a cap park over
Speaker 1: a formally open highway between that divided the city and
Speaker 1: half right uptown Dallas to the Arts district. And it's
Speaker 1: huge and i MC generator both for the private owners
Speaker 1: and then the city benefits from this. The uh we
Speaker 1: did an assessment last year. Thirty three million dollars in
Speaker 1: real estate tax has added to the city at Brian
Speaker 1: Park just for the thirty three adjacent properties. To say
Speaker 1: nothing with the guys who are blocked away, who are
Speaker 1: all arguing, you know, coming here because Brian Park is
Speaker 1: a block away, so it's a it's it's probably a
Speaker 1: nine figures the added real estate tax as a city's
Speaker 1: collecting as a result of Brian Park. You're listening to
Speaker 1: masters in business on Bloomberg Radio. My special guest today
Speaker 1: is Dan Bieerman of Biederman Development Ventures, and his company
Speaker 1: is the firm that really helped turn Brian Park around
Speaker 1: and a number of other parks, both in New York
Speaker 1: and throughout the United States and actually elsewhere in the world.
Speaker 1: Let's talk a little bit about your company mission and
Speaker 1: what should be the proper role of government in these
Speaker 1: in these public spaces. So, but by somewhat serendipity, you
Speaker 1: end up getting involved in Brian Park. A decade later,
Speaker 1: the park reopens, it's a huge success. It's literally a
Speaker 1: jewel in the midst of Manhattan. Everybody, everybody around it
Speaker 1: just loves it. I have lunch, they're pretty regularly, all
Speaker 1: the all the food vendors and all the stores adjacent
Speaker 1: to it. These guys just you know, they can't get
Speaker 1: people through the register fast. Um. You go in there
Speaker 1: on a on a bright spring day and it's wall
Speaker 1: to wall people. It's just it's just beautiful. Barrier. I
Speaker 1: should and I start to interrupt the As a job creator,
Speaker 1: these projects are enormous. Briant Park had one and a
Speaker 1: half jobs when we took it over. Now, between the restaurants,
Speaker 1: among the restaurant's kiosks. The programming we do there, it's
Speaker 1: about a thousand jobs really, and the park we're doing
Speaker 1: a new work. We have the same aspirations for that
Speaker 1: to create employment in a city like Nework that really
Speaker 1: needs so. So that leads me to my next question.
Speaker 1: So you finished Brian Park and it's a huge success.
Speaker 1: At that point, you're saying to yourself, gee, this is
Speaker 1: kind of a union space. It doesn't seem like anybody
Speaker 1: else is doing anything with this. How did you then say, Okay,
Speaker 1: we have this new model and we're going to take it.
Speaker 1: We'll take it national, all right? Was lucky. I had
Speaker 1: another product in Manhattan which is taking over whole neighborhoods
Speaker 1: through what are known as business improvement Districts s I
Speaker 1: d s. I see them every on street corners, people
Speaker 1: sweeping up, you see them throughout Manhattan. So we were
Speaker 1: the first to do it on a large scale basis.
Speaker 1: And my firm BRV actually does create them and doctor them.
Speaker 1: It's a smaller product because uh, and it's a b
Speaker 1: r V is a not for profit, Is that right?
Speaker 1: My My firm is a for profit company, which is
Speaker 1: the development profit Brian Park in thirty fourth Street or
Speaker 1: run is not for profits, but with private sector bias,
Speaker 1: we're only incidentally not for profits. So um uh. The
Speaker 1: there are numerous parks. The traditional way of fixing or
Speaker 1: creating parks is higher landscape architect come up with some
Speaker 1: ideas that are designed only, and then spend a lot
Speaker 1: of money and open it and I hope people show up. Um,
Speaker 1: you guys have a much more holistic approach. We start
Speaker 1: with programming and define define programming. It's not just movies
Speaker 1: on Fridays, exactly right. You use it a very different way.
Speaker 1: The word well said. It's a combination of things that
Speaker 1: will make audiences arrived not only at peak times like
Speaker 1: lunch and after work, but also in between. So in
Speaker 1: Brian Park you can do about forty free things and
Speaker 1: the park we have in Dallas. In the park we're
Speaker 1: doing a new work. You can learn to knit, you
Speaker 1: can learn a language, you can listen to authors push
Speaker 1: their book, you can listen to business talks. This is
Speaker 1: all spread throughout the park. That's what should drive the
Speaker 1: design and the turnaround, not spending a lot of money
Speaker 1: in a fancy architect. There are just too many cases
Speaker 1: where fancy l a's or landscape architects or architects have
Speaker 1: been paid to make a great space, and then the
Speaker 1: space opens and nobody comes. Programming is what drives people.
Speaker 1: It begins with bringing the crowds there, and how everything
Speaker 1: looks is subordinate to that utility, to the functionality of
Speaker 1: the park. You could you don't want to do this,
Speaker 1: but you could theoretically have a busy park with relatively
Speaker 1: cruddy uh surfaces and the like. The public notices the
Speaker 1: activities more than they notice the appointments. But obviously we
Speaker 1: try to be exquisite in the physical way, also by
Speaker 1: paying attention to every detail, no letter, no graffiti, um
Speaker 1: washing everything. Having exceptionally good public restrooms, which is a
Speaker 1: real thing. That's the nicest public restaurant. Ourselves on it,
Speaker 1: and it's hard to do. We learned a lot about
Speaker 1: restrooms that in my NBA class, I'm the only one
Speaker 1: who was a minor in restroom management. I think nobody's
Speaker 1: what's interested in that. There's literally a book called where
Speaker 1: to Go, and it gives you a list of all
Speaker 1: the public whatever in New York and the Brian Park
Speaker 1: are the nicest bathrooms in this We try to be
Speaker 1: as good as the ones in the plaza and the
Speaker 1: st regis, and we kind of send people up there.
Speaker 1: They're they're literally bouquets of flowers in the restroom. It's
Speaker 1: not what you would expect from a public park restaurant.
Speaker 1: We had to convince women that we had a public
Speaker 1: restroom they could trust. So the first thing you see
Speaker 1: when you go through the door is the bouquet of flowers.
Speaker 1: And we can see women saying, well, they're not going
Speaker 1: to do that if this is going to be a
Speaker 1: crummy place to go. So that's that's that's a That
Speaker 1: was a lot of psychology in development spaces, including including bathrooms.
Speaker 1: And in the last minute we have in this segment,
Speaker 1: let's talk just about uh, the idea of governance. How
Speaker 1: do you govern a park this size. It's good to
Speaker 1: get a group together. If if it has to be nonprofits,
Speaker 1: so be it. But the group should have property owners
Speaker 1: who have a a real stake. UM. Some public officials can't
Speaker 1: be a majority of them, because otherwise you're off to
Speaker 1: the races with the way government's always operated. And then
Speaker 1: other people who are interested. Tenants are a good group
Speaker 1: to include, UM and UM solent to staff as well.
Speaker 1: As money. Yeah, that's right, and I you know, you know,
Speaker 1: it's not a dictatorship. I have to answer to a board.
Speaker 1: But after thirty five years of doing this, they tend
Speaker 1: to concede that I know what I'm doing, so I
Speaker 1: get a lot of freedom to run the thing the
Speaker 1: way I want. I'm Barry Ritt Helps. You're listening to
Speaker 1: Masters in Business on Bloomberg Radio. My special guest today
Speaker 1: is Dan Biederman of Bietterman Development Ventures. They are the
Speaker 1: firm that helped turn around Brian Park and literally dozens
Speaker 1: of other parks throughout the country. And before the break,
Speaker 1: we were talking about the proper role of government in
Speaker 1: these public spaces and and so let's get into that
Speaker 1: what should be the proper role of government the faults
Speaker 1: of government and running services besides parks, but parks is
Speaker 1: part of it is they tend to over uh spend
Speaker 1: and undercollect so the profit and law statement comes out
Speaker 1: as skew. They're for forcing them to assess people who
Speaker 1: are the taxpayers a lot more than they might otherwise
Speaker 1: have to. Now, when we were talking about Brian Park
Speaker 1: in the beginning, you said they had a hundred thousand
Speaker 1: dollar budget in the nineteen eighties. That seems like nothing,
Speaker 1: that that was just neglect. But in the cases where
Speaker 1: government does something a new, they tend to make deals
Speaker 1: that are above market on the employees side, and then
Speaker 1: there are revenue sources that they could be collecting from that.
Speaker 1: Because it's not a for profit company, nobody pays attention
Speaker 1: to the Most governments have a revenue source or two,
Speaker 1: mostly taxes and then some fines, but the private sector
Speaker 1: looks for every dollar it can in many different ways.
Speaker 1: So Brian Park has five different revenue sources. We collect
Speaker 1: from the restaurants and chios in the park over three
Speaker 1: million dollars a year in rent. We have sponsors of
Speaker 1: some of our more prominent activities like the skating rink
Speaker 1: and winter. Bank of America has been fabulous sponsor for
Speaker 1: three years. Their new headquarters is right on the corner
Speaker 1: of the park opposite directly opposite forty and they've been
Speaker 1: ending America terrific. HSBC is a sponsor. Southwest Airlines has
Speaker 1: naming rights to a chios there um and so, and
Speaker 1: we've had events from well, I'll get to that later.
Speaker 1: The sponsorships a loan or about five million dollars the
Speaker 1: events we have introducing products. Everybody from Starbucks to Microsoft
Speaker 1: to uh T Mobile has introduced products in Brian Park
Speaker 1: because of its prominence. Doesn't take much time and it's rare,
Speaker 1: but when they do it, we make them pay for it.
Speaker 1: That's another million and a half. And then there's a
Speaker 1: surrounding business improvement district we mentioned that's about a million
Speaker 1: and a half also, and then drives and dribs of
Speaker 1: other things. We do some merchandizing, not very successfully. Total
Speaker 1: of about twelve million dollars in revenue. So that's how
Speaker 1: we got to that. Didn't a rock Center and uh
Speaker 1: A rouse number. So if this wasn't if this wasn't
Speaker 1: a U corporation running this, what would the city be
Speaker 1: spending on on Brian Park on its own? They probably
Speaker 1: by this point I figured it out a bit and
Speaker 1: have a bigger budget, but but not twelve million dollars
Speaker 1: and it would be heavy in um you talk about
Speaker 1: minimum wage changes, this with the employees or the porters
Speaker 1: would be making thirty dollars an hour. That's not the market.
Speaker 1: So you're nice to your people and you're generous with them,
Speaker 1: but you can't pay them. You can't over pay, you
Speaker 1: can't pay. The pension deals are so unsustainable, and states
Speaker 1: like New Jersey and Illinois that those states are constantly
Speaker 1: threatened with bankruptcy. Truth, So you you can't do that
Speaker 1: if you're a private operator of a public space. A
Speaker 1: little trivia about Illinois, they stopped paying out their lottery
Speaker 1: winners for a while because they literally didn't have the money.
Speaker 1: So not only is the whole thing a sucker bet
Speaker 1: that the odds are dramatically against you winning, but even
Speaker 1: if you win, you may not get paid because now
Speaker 1: you have counterparty risk, which is really quite amazing. So
Speaker 1: so let's talk about some of these other parks and
Speaker 1: how the government there interact with the private sector. So
Speaker 1: in Dallas, you have the Clyde Warren Park, and that's
Speaker 1: sort of an unusual situation because you had a highway
Speaker 1: kind of dividing the city in half. How did the
Speaker 1: park change that kept the highway and we did a
Speaker 1: beautiful park with a ton of activity. And there's some
Speaker 1: very wealthy people and public spirited people in Dallas. Jody
Speaker 1: grant um and and it was ahead with his wife, Sheila,
Speaker 1: and they made a major difference by making a deal
Speaker 1: with the mayor that the private sector would essentially finance
Speaker 1: the park and a little bit more if the state
Speaker 1: of Texas and the city financed the and a little
Speaker 1: federal help from uh uh federal funds. UH did the cap.
Speaker 1: So it was a good You say, the cap? What is?
Speaker 1: What is the cap? Essentially A it's it's currently being
Speaker 1: thought of in many other cities. It's covering the highway
Speaker 1: so that the noise of an interstate does not ruin
Speaker 1: the adjacent neighborhoods in the city. Atlanta's considering it now
Speaker 1: l A. I don't think l A is going to
Speaker 1: get there because the costs are gonna be too eye.
Speaker 1: And the great thing about Texas is construction costs are
Speaker 1: incredibly reasonable. Why is that? Uh? An expensive labor from
Speaker 1: over the border of sense of unions has something to
Speaker 1: do it. This project, soup to nuts, including the park,
Speaker 1: was a D three million dollars. I guarantee you in
Speaker 1: the Northeast that would have been half a billion and
Speaker 1: at least and wouldn't have happened either. But if it
Speaker 1: had happened, would have been happened. Speaking of the Northeast,
Speaker 1: before I want to ask you about well, let's go
Speaker 1: right to Canal Side in Buffalo. So this was a
Speaker 1: vacant space that was kind of just being ignored. What
Speaker 1: happened with that that space, Well, they've already started to
Speaker 1: be fair before we got there. It's a very good
Speaker 1: and give government Gunner Cuomo some credit. It's a very
Speaker 1: good state agency Erie Canal Harvard Development Corporation, which run
Speaker 1: by smart people, and they they liked the idea of
Speaker 1: the programming and they've really energized the area, um with
Speaker 1: not so much money of the taxpayer as some of
Speaker 1: the other elements of Buffalo. Uh. And you know, I've
Speaker 1: got a public space with concerts and and food and
Speaker 1: beverage and skating rank that's really a credit to downtown Buffalo.
Speaker 1: And uh there's development that's been generated around it, partly
Speaker 1: by the space, partly just by good Buffalo developers like
Speaker 1: Benderson and the owners of the Buffalo Sabers doing major things.
Speaker 1: So if you haven't been in Buffalo, awhile, it's worth
Speaker 1: looking at the real progress there. So two things I
Speaker 1: would be remiss if I didn't discuss. One is the
Speaker 1: high Line Park in Manhattan, which talk about real estate
Speaker 1: prices only unbelievable that's all. Now you're what was your um,
Speaker 1: I've said when I was describing this conversation to people
Speaker 1: in advance, I've said, if you like the high Line,
Speaker 1: which is a huge hit amongst both New York City
Speaker 1: residents and tourists, I think that never would have happened
Speaker 1: if it wasn't for the Bryant Park. I don't know
Speaker 1: if I can take it for it, but I will
Speaker 1: say I'm giving you a little bit thank you. Jamestown. Uh,
Speaker 1: the owner adjacent paid me a little bit of money
Speaker 1: to advise Rob Hammond, who's the U one of the
Speaker 1: founders of Friends of the high Line, and he listened
Speaker 1: to what we said. He was he was a good client.
Speaker 1: So I only had a minor role, but they did
Speaker 1: go for some of the stuff that we did in brand.
Speaker 1: It's worked out really well. And Um there's a park
Speaker 1: that's I believe it's in the midst of of um
Speaker 1: construction that was a former subway station that's reopening the
Speaker 1: low Line. Yeah, but they're trying to model after the
Speaker 1: high Line, and it's kind of clever, but it is underground.
Speaker 1: It doesn't have the views that thought a little darker. Yes,
Speaker 1: I don't know much about it, but they did call
Speaker 1: to ask some questions. It's nice to so outside of Manhattan,
Speaker 1: outside of New York, what are the areas have you
Speaker 1: guys been working in and and what other successes have
Speaker 1: you had in the United States or the the the
Speaker 1: ones we always point to that are really finished our Dallas,
Speaker 1: Pittsburgh and Newark. And Pittsburgh, what used to be a
Speaker 1: parking lot next to the Cathedral of Learning was one
Speaker 1: of our early parks. It's called Shenley Plaza. Terrific improvement
Speaker 1: in Pittsburgh's a great city to work in and there's
Speaker 1: a lot of good stuff in new Work. We don't
Speaker 1: think of anything getting done when we think of New Wark,
Speaker 1: what what was that park? Thanks to Ray Chambers, who's
Speaker 1: UH buyout guy, who then devoted the rest of his
Speaker 1: career to fixing downtown Newark and Mayor Booker the UH
Speaker 1: and PROW which has been a key backer along with
Speaker 1: a few others potential and prudentials right there. They their
Speaker 1: foundation has been deeply involved. We really took a part
Speaker 1: very similar in its role there to Brian Park and
Speaker 1: have turned it into a lively space after years of
Speaker 1: it being vacant. It's called Military Park. It's between the
Speaker 1: arena and the New Jersey Performing Arts Center. PROW just
Speaker 1: built a new headquarters type building on top of it,
Speaker 1: right next to it. And there were some who said,
Speaker 1: and I always annoyed me, Well, Bryant Park can only
Speaker 1: be done where there are a lot of yuppies around
Speaker 1: and huge office buildings, and and and and it wouldn't
Speaker 1: it's not relevant to the minority community. Newark's a majority
Speaker 1: minority city. And uh, they have been excellent. The residents
Speaker 1: and office workers around there have been excellent patrons of
Speaker 1: the park. So it's it's a kind of weird thing
Speaker 1: to say minorities don't like parks and outdoor spaces. That's
Speaker 1: a weird perspective. They're actually the Newark residents who are
Speaker 1: using it are actually better for us because they'll they'll
Speaker 1: spend a little more time there, are a little more patient. Um,
Speaker 1: they're a little less on their iPhones and um. It's
Speaker 1: it's been a wonderful thing to see the social fabric
Speaker 1: of the park change. We put a restaurants, tiny restaurant
Speaker 1: in that's Salzburger's pretty inexpensively and that was hard to arrange.
Speaker 1: You're doing free WiFi, and all of these parks wif
Speaker 1: park is a hugely successful WiFi thing, and they're hard
Speaker 1: to set up. Everybody says they have WiFi, but half
Speaker 1: the time doesn't work very well. But the one of
Speaker 1: Newark really is working well, and we worked well with
Speaker 1: the government of Mayor Booker. Mayor Baraka has has continued.
Speaker 1: He's been great. He's visited the park three times to
Speaker 1: read his poetry and play chess and the like. And Um,
Speaker 1: the WiFi system was specked by the city and we
Speaker 1: extended beyond the park and now you've got free WiFi
Speaker 1: in that vicinity. Really in new Work, we've been speaking
Speaker 1: with Dan Biederman of Beeteman Redevelopment Ventures discussing the public
Speaker 1: and private space. If you enjoy this conversation, be sure
Speaker 1: and stick around for a podcast extras where we keep
Speaker 1: the digital tape rolling and continue chatting. Be sure and
Speaker 1: check out my daily column on Bloomberg View dot com
Speaker 1: or follow me on Twitter at rid Halts. I'm Barry
Speaker 1: rid Halts. So you've been listening to Masters in Business
Speaker 1: on Bloomberg Radio. Welcome to the podcast. Um, Dan, thank
Speaker 1: you so much for doing this. This has really been
Speaker 1: a fascinating Charlie makes fun of me every time I
Speaker 1: say that, but this is fascinating stuff. And in the
Speaker 1: intro I said, you may be the person who is
Speaker 1: on a fractional basis least known to greatest impact to
Speaker 1: the public. I can't count how many people do you
Speaker 1: guys track through Brian Park in any given year? Six
Speaker 1: million different visits, not six million different individuals, but there
Speaker 1: are six million visits a year. It's it's the most
Speaker 1: crowded per acre public space in the world, in the
Speaker 1: whole world. I gotta think more people go through um
Speaker 1: Central Park, but that's hundreds and hundreds of acre. Their
Speaker 1: visitor count I think is in the twenty four million range,
Speaker 1: ining like that, But but they're hundreds of times were
Speaker 1: six acres but there's no People always throw up possibilities.
Speaker 1: Trafalgar Square, I said, Trafugar Square is empty compared to us.
Speaker 1: There's really Yeah, well, they have big events, but there
Speaker 1: that's a one off, right, What about places in Shanghai
Speaker 1: or Hong Kong. You know, Shanghai doesn't have anything with
Speaker 1: that kind of congestion. I've seen some great parks in Beijing,
Speaker 1: but they get crowded they send in the text, it's
Speaker 1: not it's not as crowded as Bryant Briant as jammed
Speaker 1: and we we like it that way. Do you UM,
Speaker 1: have you guys looked overseas? Have people reached out to
Speaker 1: you from other countries other places? You know? I haven't
Speaker 1: made a big thing of it. I've There are five
Speaker 1: countries where I've done some advising the UK, Singapore, Finland, UM,
Speaker 1: Israel and Canada. Yeah, and UM, Singapore, so that's pretty
Speaker 1: far afield that they have something called the Urban Redevelopment
Speaker 1: Agency which is very successful and UM I've been on
Speaker 1: their advisory panel once or twice. And basically, though our
Speaker 1: work is in North America, I've done a fair amount
Speaker 1: of work in Toronto now and UM the same basic concept.
Speaker 1: They take your model and reproduced. Do you have any competitors?
Speaker 1: Are there any other businesses doing what you do? It's
Speaker 1: interesting the competition is to do parts the traditional way
Speaker 1: with landscape architects and architects, and that's not us. UM.
Speaker 1: We have a really narrow niche. And UH, there are
Speaker 1: a couple of economic consulting firms that say they do
Speaker 1: what we do, but they've kind of been derivatives, but
Speaker 1: we're it's it's a very narrow niche, which is the disadvantage.
Speaker 1: But the great thing is that we created the field.
Speaker 1: You own the space. So we got a lot of
Speaker 1: calls and we don't. We do some marketing, but not much.
Speaker 1: We mainly get incoming inquiries from people who have been
Speaker 1: visited our places. That that was my next question is
Speaker 1: is there enough work to keep a firm busy full time?
Speaker 1: How many employees are thirteen employees, nine full time, four
Speaker 1: part time? It's very small and uh, there's plenty of work.
Speaker 1: I'm as my wife predicted UM a long time ago.
Speaker 1: Your only problem is going to be staffing the work.
Speaker 1: They're gonna be lined up around the block when you open.
Speaker 1: This took a while for that to happen. But it's busy.
Speaker 1: So what other Let's let's go over some other parks
Speaker 1: elsewhere where else have you Well? These are cities were
Speaker 1: in starting from the west, Honolulu, San Francisco, Oakland, Actu
Speaker 1: Really Now l A, Tempe, Arizona, Houston, Dallas, Green Bay, Detroit, Buffalo, Toronto, Atlanta,
Speaker 1: um Newark, Greensboro, North Carolina, Boston. So we've talked about
Speaker 1: we've talked about these huge successes. What hasn't worked out? Um.
Speaker 1: Once in a while, a company, but more often a
Speaker 1: government wants you to answer the questions they ask you
Speaker 1: as a consult in a certain way. And I have
Speaker 1: to give my little speech which I was taught when
Speaker 1: I was at my first job after business school. American
Speaker 1: management systems really good, smart, gut bunch of guys no
Speaker 1: longer exists. They were sold, but they said, as a consultant,
Speaker 1: you need to tell the client. Do you want me
Speaker 1: to tell you what you want to hear or you
Speaker 1: want me to tell you what you need to hear?
Speaker 1: The right answer. Um. Once in a while we get
Speaker 1: a client who wants us to give them the answer
Speaker 1: they wanted to hear when they brought us in, which
Speaker 1: is very often the wrong answer. And it's usually a
Speaker 1: government agency, but sometimes a private player. UM. And then
Speaker 1: the the other kind of client. That's the challenges. They
Speaker 1: are more interested in how much they pay than in
Speaker 1: how much success they have. They only look at the
Speaker 1: expense side of the ledger with you. UM. So we've
Speaker 1: had a few of those, but I would say of
Speaker 1: the client experiences have been great, and I speak highly
Speaker 1: of all of them, and I hope they speak well
Speaker 1: of me. So when you set one of these up,
Speaker 1: how much of the funding is coming from outside government?
Speaker 1: From revenue you generate in the park, plus whatever initial
Speaker 1: seed funding comes from the surrounding good questionities, real estate companies, whatever.
Speaker 1: We start from the desire to have it all private funding,
Speaker 1: all private funding. I didn't make a big fetish of
Speaker 1: that in the broadcast, But the the aim is not
Speaker 1: to be beholden to government practices because you don't have
Speaker 1: government money. Uh So Brent Park has not taken any
Speaker 1: government money of editing level, uh since it was founded. Wait,
Speaker 1: so that the park is running for all these years,
Speaker 1: since it opened in nine and New York City taxpayers
Speaker 1: are not paying for that, not a penny they actually
Speaker 1: there was an initial kind of good by payment that
Speaker 1: ended in and since twenty years no no government money,
Speaker 1: and some clients can't afford that. But generally, meaning there's
Speaker 1: not the density that'll cover that. I mean, not only
Speaker 1: they aren't the varieties of programming that would allow you
Speaker 1: to exclude government money. Um. I'm trying to think of
Speaker 1: an example where we're gonna have to take government money
Speaker 1: like I would think San Francisco has enough population coursing
Speaker 1: through a downtown space that that should be easy. But
Speaker 1: Temple Arizona maybe not the same volume of people, not
Speaker 1: as not as concentrated um uh density. But we're talking
Speaker 1: to the Tempee people about a possible use of the
Speaker 1: techniques we use to build our capital plan, which is
Speaker 1: borrowing money um using the government's in New York City
Speaker 1: triple tax exempt capacity issue a bond in order to
Speaker 1: build issue bonds. We repay they they're not on the
Speaker 1: hook for penty of it, and so it's just an
Speaker 1: expensive source of capital. Yeah, we're the debt service and
Speaker 1: that's been fifty million dollars total over the over the run.
Speaker 1: And that's how Grand Central and thirty fourth Street got
Speaker 1: built with that technique, rather than asking government for capital funds,
Speaker 1: which is always a very difficult and in eastern and
Speaker 1: West coast cities it's usually tied to some labor deal.
Speaker 1: It's very expensive. So so let's talk a little bit
Speaker 1: about the thirty four Street Business Development company you have
Speaker 1: that goes from the Empire State Building fifth and thirty
Speaker 1: four little east of that actually to Macy's where you
Speaker 1: have what is that horrors Greeley Park or something really
Speaker 1: part to the south and Herald Square to the north,
Speaker 1: and all the way west past that to the edge
Speaker 1: of Hudson Yard's past Penn Station, the post office. That's
Speaker 1: all an area run by a business improvement district. Not everything,
Speaker 1: but most of what you see there as a member
Speaker 1: of the public, the litter collection, the Capital plant, UH,
Speaker 1: security officers parks is run by our b I D.
Speaker 1: And that's funded privately as well, all private money. We
Speaker 1: don't accept any government money. Really that that's quite fascinating. UM.
Speaker 1: Tell me about a challenge. What was a park that
Speaker 1: turned out to be successful that when you first came
Speaker 1: across it you had to scratch your head a little
Speaker 1: bit and say, here's what's going on here, uh Seattle. UM,
Speaker 1: that's hugely successful. In that case, we're not running it.
Speaker 1: We very often at that distance tell them what to
Speaker 1: do and then back off. And there was a very
Speaker 1: good group that Downtown Seattle Association that took our recommendations
Speaker 1: whole and UM running with it. It's usually successful. It's
Speaker 1: called Occidental Park. It's a couple of blocks from the
Speaker 1: Stadia there UH in the neighborhood known as Pioneer Square.
Speaker 1: This was a truly violent space. It was drugs, a
Speaker 1: lot like Brian Park at the beginning, drugs and really
Speaker 1: bad guys hanging out and victimizing people. TOMPs of tech
Speaker 1: companies a couple of blocks away, none of them were
Speaker 1: using it. The employees weren't there. So we told them
Speaker 1: how to program and how to spend a little bit
Speaker 1: of money without government on various things. The Seattle Parks
Speaker 1: Foundation in Downtown Seattle Association ran with it, and it's
Speaker 1: a real turnaround. I keep track of it long distance.
Speaker 1: We're done, and they were very grateful. John Schules is
Speaker 1: then now a new head of the Downtown Seattle Association.
Speaker 1: Why do I know that name? He's He's It came
Speaker 1: up through the ranks. But John said, this has been
Speaker 1: a huge success, and we're really grateful. I'm sure they're
Speaker 1: spreading the word that this is a great approach, quite
Speaker 1: quite fascinating. So you mentioned Canada and Singapore. Most of
Speaker 1: it has been in the US. Do you find a
Speaker 1: difference between cities on the coasts and cities in the
Speaker 1: mainland in the United States. I come back to New
Speaker 1: York sometime to press that I'm back in a tough
Speaker 1: environment for my field. Um, it's easier in the middle
Speaker 1: of the country. Yeah, the why is that? Are people
Speaker 1: nicer or is it just there everybody's kind of on
Speaker 1: the same page and you don't have the intrinsic interest
Speaker 1: groups fighting. It's two things, um um unions. UM. I
Speaker 1: think New York State is thirty union workforce, astonishing number,
Speaker 1: New Jersey, California. Really unions are in very good control
Speaker 1: of legislative processes. And there's unions have been on the
Speaker 1: wayne nationally for a long time. What is it, less
Speaker 1: than five percent of workers are now and the number
Speaker 1: is tiny compared to what it was a century ago,
Speaker 1: a half a century ago. But um not um, but
Speaker 1: not immunist about those states so much so. UM. That
Speaker 1: is one difference. In the second is there really is
Speaker 1: a difference in terms of the belief in um capitalist system.
Speaker 1: I don't have to I started a speech once in
Speaker 1: Dallas about this is the reason our parks work. And
Speaker 1: part of my pitch was that, you know, the freaner
Speaker 1: prise system is a good thing. And they were one
Speaker 1: of the guys on the board waved his arms at Dan,
Speaker 1: you don't have to make that speech. Here. We got
Speaker 1: this is Uh, that's the difference. Um. The uh terms
Speaker 1: of employment a real threat to our field. Um, it's
Speaker 1: not just me, it's the little organizations that are doing
Speaker 1: the same thing in parks and neighborhoods. Is this specifying
Speaker 1: of the terms of employment by government which is happening
Speaker 1: in states like New York, New Jersey and Washington and California.
Speaker 1: But when you say specified terms of well, we now
Speaker 1: have in some of the cities in those states, UM
Speaker 1: minimum wages of fifteen dollars, um, UM specified amount of
Speaker 1: sick leave in New York City, UM, specified amount of
Speaker 1: maternity leave. A lot of these things I did voluntarily.
Speaker 1: But to legislate across every business in your environment and
Speaker 1: say all of you must do the following things, really,
Speaker 1: in my mind, goes too far, and for little efforts.
Speaker 1: We try to do a lot with little. If you're
Speaker 1: a little company, it's whether you're a for profit or
Speaker 1: not for profit. It's really difficult to uh do this
Speaker 1: fifteen dollar So Seattle going up to fifteen dollars by
Speaker 1: what it's phased until I think the nineteen but there
Speaker 1: that is in the next three or four years. Yeah,
Speaker 1: it's gonna hurt their ability to do things like pick
Speaker 1: up paper in parts that they privately managed and they
Speaker 1: know that, but the mayor's behind it and they have
Speaker 1: to be behind it. And I thought it was companies
Speaker 1: with fifty people or more. Am I confusing that with
Speaker 1: something else? That that was one of the criteria for
Speaker 1: New York. But I don't know if that's true in Seattle.
Speaker 1: But fifteen dollar minimum wage and some lower cost environments,
Speaker 1: Washington is not. It's not New York. It's a very different.
Speaker 1: So let's challenge. Let's let's talk a bit, because restaurants
Speaker 1: are such an important part of the revenue stream for
Speaker 1: these arks. We had Bobby flay on a few months
Speaker 1: ago and he was apoplectic about the changes. He said,
Speaker 1: you can't run a restaurant profitably in New York City anymore.
Speaker 1: Given the changes that are gonna be phased in. There
Speaker 1: are people who live earned their living on tips. I
Speaker 1: can't pay them twelve dollars an hour. That's too much.
Speaker 1: It's gonna be a challenge. The restaurants in Central Park
Speaker 1: UM with UM obviously involvement of the city because they
Speaker 1: own the real estate, are gonna have a challenge because
Speaker 1: the hotel trades council. UM dominates UM their workforces now
Speaker 1: and I don't know if those two will survive. They're
Speaker 1: great place. Has that been the issue with Tavern on
Speaker 1: the Green has been a part of an issue. The
Speaker 1: reason there weren't so many bids on the new Tavern
Speaker 1: deal was that the city imposed uh, the Hotel Trades
Speaker 1: Council on the deal. And but to be fair to
Speaker 1: the city, I think one of le Roy had welcomed
Speaker 1: them in when he owned Tavern on the Green previously,
Speaker 1: So that's UM dicey operation. They think they only got
Speaker 1: two or three bids for what really should have been
Speaker 1: a great opportunity because there was a lot of catering
Speaker 1: postage a ton absolutely at one point in time that
Speaker 1: was also a beautiful restaurant and kind of fell into
Speaker 1: disused disrepair and it it's not what it was. I
Speaker 1: don't know what's going on with it now. I haven't
Speaker 1: They want to representative restaurant, but the volume isn't what
Speaker 1: it was because it was cut down. Warner had turned
Speaker 1: it into a mega megal. It's uh. I think he
Speaker 1: had thirty five million dollars in revenue annually, a part
Speaker 1: of it from catering Uh, and now smaller. So we
Speaker 1: we talked about overseas um and we talked about the
Speaker 1: difference in in coasts. You know, when you look at
Speaker 1: at some of these other projects, what what stands out
Speaker 1: when someone first approaches you with, Hey, we have this
Speaker 1: park and it's kind of a mess and we want
Speaker 1: to clean it up. How do you go about starting
Speaker 1: that process reviewing that? What's that? Like? The first thing
Speaker 1: we do is kind of intriguing market share calculation. Um.
Speaker 1: This comes from a conversation with Eli Broad, who's done
Speaker 1: wonderful things for downtown l A. But Eli was too optimistic,
Speaker 1: in my view about how many people would visit the
Speaker 1: public spaces on Grand Avenue after the Disney Concert Hall
Speaker 1: was built. So UM, I kept warning him, Eli, not
Speaker 1: as many people are going to visit just to see
Speaker 1: the building as you think. And then I said, I
Speaker 1: need to have a systematized way of making that case
Speaker 1: to clients like Eli, who's a smart guy, and you know,
Speaker 1: didn't really believe me. So we created something called a
Speaker 1: visitor market share calculation. We go out depending on the
Speaker 1: walking distance of each city. Dallas has a terribly small
Speaker 1: walking distance. Nobody walks there. Uh, New York, Boston, Washington,
Speaker 1: ter everybody walks. So we go at twelve hundred feet
Speaker 1: in those cities and two hundred or three hundred in Dallas,
Speaker 1: and then we look at the adjacent hotels, office buildings, residences,
Speaker 1: retail shops, museums, and we say, how many people plausibly
Speaker 1: could be in this public space? Uh, and what are
Speaker 1: we gonna have to do to get them there? Because
Speaker 1: our market share at Brian Park sounds small, but it's
Speaker 1: four percent basically of all the people in the surrounding
Speaker 1: area or in Briant Park at lunchtime. And you say,
Speaker 1: what happened the other ninety six And the answer is
Speaker 1: their own vacation, they're on a business trip, they're in
Speaker 1: a conference, they're eating at their desk by the uptown.
Speaker 1: So we lose nineties six percent through no fault of ours,
Speaker 1: But four percent is that's a big number of massive
Speaker 1: But some clients think they're gonna get ten or so
Speaker 1: first time we do is disabuse them of that, say,
Speaker 1: Brian Park has been plugging away doing this for twenty
Speaker 1: five years. You're not going to get higher than four percent.
Speaker 1: And then we say, okay, what's going to drag these
Speaker 1: people in. Is it knitting um seminars like we do
Speaker 1: in Brian Park? Is it juggling clinics? Is it concerts?
Speaker 1: Is it the reading sessions we have? Is that patonk
Speaker 1: is a ping pong? We have a putting green. All
Speaker 1: those things. We put together a bunch of things on
Speaker 1: a map and show the client how we're gonna drag
Speaker 1: people into their space at hours they might not have
Speaker 1: expect to be there, including seasons where in the past
Speaker 1: Brian Park was empty in the winter. For right, it's
Speaker 1: jam Now between the rink and then around the holidays
Speaker 1: are all the all the kiosks selling all these different
Speaker 1: crafts and unique sort of products. It's jam packed when
Speaker 1: you go in there. So um, that's Those are our
Speaker 1: starting points, and from then it's a budget. And then
Speaker 1: only last do we go to the architects and say, okay,
Speaker 1: now draw this up for us. We we saved the
Speaker 1: clients a lot of money by not having them, uh
Speaker 1: spend a lot of money on fancy plans, especially in
Speaker 1: blue states where the construction costs are so high. Dallas
Speaker 1: can afford to do a little bit of that. The
Speaker 1: park really cost about twenty three million, but could have
Speaker 1: been but less. But the same effort in New York
Speaker 1: above the surface of the park would have been three
Speaker 1: times as much. I was gonna say five x. It's
Speaker 1: only three times. Uh, this is never been sure, but
Speaker 1: it would have been very expensive proposition quite quite fascinating.
Speaker 1: So so are some of the other challenges you face.
Speaker 1: You have to get the clients to be realistic. You're
Speaker 1: dealing with politicos, you're dealing with unions. What else is
Speaker 1: a challenge that people may not be aware of that
Speaker 1: involves turning around what's in a great while? We come
Speaker 1: upon something where I say to the staff, you know
Speaker 1: this is pushing on a string to use that ran Well,
Speaker 1: it's it's it's a suburb where there's no particular reason,
Speaker 1: there's no density, and there's no reason people within a
Speaker 1: reasonable distance, we're not going to go there. Even if
Speaker 1: you produce something that's so spectacular that people should want
Speaker 1: to see it as a curiosity once in a while.
Speaker 1: That's a challenge. Other ones are we have there. There's
Speaker 1: a park I won't name in Boston. We we have
Speaker 1: two projects in Boston, South Station and Finnal Hall. There's
Speaker 1: a park I'd like to do there, but the This
Speaker 1: is not the fault of the this mayor or the
Speaker 1: previous mayor. It's the fault of the butters who are
Speaker 1: thinking too small about it. It could be one of
Speaker 1: the great public spaces in the country, surrounded as it
Speaker 1: is by iconic structures, but it's one Another big problem
Speaker 1: is just this small thinking I call it. It's just
Speaker 1: let's collect a little bit of money and turn on
Speaker 1: the fountains and have a concert once in a while,
Speaker 1: and doesn't get it done. It's not that the people
Speaker 1: are not smart, it's that they don't have um the
Speaker 1: frame of reference to think bigger. And that's a big
Speaker 1: problem for my firm. I'm in Chicago pretty regularly and
Speaker 1: I'm always impressed with how well done their public spaces are.
Speaker 1: Have you guys done anything in there? It was funny,
Speaker 1: funny Mayor Dally. I'm very fond of him. Um the
Speaker 1: second Mayor Dally. He was in Brian Park taking notes
Speaker 1: one day and he's chief of staff called me and
Speaker 1: he said he has a question and I said, I'm
Speaker 1: coming right down. I want to meet him. He said, no,
Speaker 1: you please don't do that. He's on his way to
Speaker 1: investment bankers in ten minutes, but he is curious. I said, Okay, Drew,
Speaker 1: I'm gonna give you these answers, but only if I
Speaker 1: can visit him in Chicago. So I went out there,
Speaker 1: had an incredible meeting with him. Ordale. It was a
Speaker 1: great park mayor, and you're right, the parks really have
Speaker 1: been well done. Um. He did it through a park district,
Speaker 1: not through B I d S, not through privatization. He
Speaker 1: didn't really believe in privatization because it's all it's all city.
Speaker 1: But unlike New York and other big cities, Chicago's mayor
Speaker 1: is essentially a benevolent dictator. Uh. And so we have a
Speaker 1: a family there, and one day we were there. We
Speaker 1: were there every Thanksgiving for the past twenty five years,
Speaker 1: and we go to the museums, we go to Second City,
Speaker 1: we do everything. Every I come back ten pounds heavier
Speaker 1: every Thanksgiving. And it ain't the Turkey. But we're walking
Speaker 1: through a park and I'm like, wow, these are really
Speaker 1: beautiful iron uh fencing, not the usual chain link junk,
Speaker 1: but like cast iron or beautiful. And I'm like, when
Speaker 1: did this happen? Stay straight? They did a nice job.
Speaker 1: And you know, I asked him during the meeting. He
Speaker 1: was very detailed, and I said, you know, you know
Speaker 1: a lot about this um. Of all the mayors, have
Speaker 1: you know the most and that had was generally known.
Speaker 1: And after I asked his chief of staff, where do
Speaker 1: you learn all that? Because most mayors don't know these
Speaker 1: details of visual stuff. And he said his father. Of course,
Speaker 1: I said, how did that happen? He said, he took
Speaker 1: him out in a car on the weekend. Richie, look
Speaker 1: at that building that looks horrible, and I just told
Speaker 1: my guy, you needed to paint that side of it
Speaker 1: and take that that iron casing away. He said, he
Speaker 1: really his father. Surprisingly, that the old the old Mayor
Speaker 1: Dally Richard Daydalely, I guess it was, had a very
Speaker 1: good eye, but was known as a ward heeler and
Speaker 1: a tough meaty. He had another skill which was not
Speaker 1: highly publicized outside of Chicago. Well, the sun apparently inherited
Speaker 1: that eye, because one day he issued a dictate, which
Speaker 1: is channeling fences down cast iron fences, replacing them. And
Speaker 1: you good luck finding a chain link fence on any
Speaker 1: of the major parks in Chicago. They're all now. If
Speaker 1: you go to parts in Manhattan, you'll see these gorgeous
Speaker 1: Gramercy Park and some which has always been a private park.
Speaker 1: But some of these other parks have these beautiful cast
Speaker 1: iron fences. But it was, you know, dealers, somebody's choice.
Speaker 1: They basically issued an addict and ninety days later there
Speaker 1: were no more channeling fences in the park. I know
Speaker 1: I only have you for another ten or fifteen minutes,
Speaker 1: So let me jump right to my favorite questions where
Speaker 1: I asked these of all my guests before we do that.
Speaker 1: Are there any specific questions I missed that anything you
Speaker 1: want to bring up um that I may have not
Speaker 1: gotten to. Uh, I don't think so. Which questions do
Speaker 1: you think of asking? Asking the last the last eight?
Speaker 1: So we did some of these so we know what
Speaker 1: you did before you started working in this space. Let
Speaker 1: let me ask you who who were some of your
Speaker 1: early mentors. Uh. There was a guy who's not well
Speaker 1: known in the business community, William H. White Jr. Who
Speaker 1: came up with a lot of the theories about movable
Speaker 1: chairs and the like that we've implemented in Brian Park.
Speaker 1: Brilliant guy. He was a journalist. He's known more for
Speaker 1: the books he wrote, including The Organization Man, and he
Speaker 1: was closely linked. Unbeknownsted we can say it now that
Speaker 1: he passed away about fifteen years ago. The Rockefellers supported
Speaker 1: his work. They thought it was so important, gave him
Speaker 1: an office and a secretary and consulting deals. Um. There
Speaker 1: was one point he took me down to Princeton and
Speaker 1: he said, little little known to the public, the Rockefellers
Speaker 1: don't give money to the school unless I say that
Speaker 1: the physical improvement is a good one. So I want
Speaker 1: to really show you something outside of East Pine Hall.
Speaker 1: And he was. He was a tremendously important factor. And
Speaker 1: what we didn't Briant Park and then uh, the people
Speaker 1: who helped me get started with these entities other than
Speaker 1: the Rockefellers, Andrew High School, who was the chairman of
Speaker 1: time ach and agreed to be our chairman for many years.
Speaker 1: Michael Fuchs who succeeded him. Yep, Michael's a brilliant businessman
Speaker 1: and has been our chairman at Brian Park of the
Speaker 1: kind of celebrity entity for about twenty years. Um, and
Speaker 1: learned a lot from him. So and if I go
Speaker 1: to Brian Park and I first time I ever sold
Speaker 1: Louis c K had to be ten years ago in
Speaker 1: the middle of the day at Brian Park. The comedy
Speaker 1: series and slaughtered the part. People were falling literally rolling
Speaker 1: around the grass. That was a great comedy series. The
Speaker 1: language was a problem. We couldn't get the comedians to
Speaker 1: work clean so eventually, but it was hilarious, but I
Speaker 1: thought of bringing it back. It was it was so.
Speaker 1: I saw him there, I saw Louis Black there, showed
Speaker 1: up and I'm sure you could randomly get just about
Speaker 1: anybody else you wanted. Suman was there the first time
Speaker 1: I ever saw her. She was very profane, very profane.
Speaker 1: Check out her interview with David Steinberg on Showtime. It's hilarious.
Speaker 1: Peter Malkin is an investor. He's eighty two now, in
Speaker 1: fact today he's eighty two. He um uh was the
Speaker 1: chairman of my b I D s at Grand Central
Speaker 1: and thirty four Street and was very uh instrumental in
Speaker 1: this stuff getting going. And another mentor is my wife,
Speaker 1: who's a brilliant she's a litigator with a practice and
Speaker 1: fine art law. It's a fascinating practice. She formed the field,
Speaker 1: but she's a very good advisor on a lot of things.
Speaker 1: She's she should be involved in that Picasso has a
Speaker 1: lot of arts law clients who were have stuck with
Speaker 1: her over the years. But she's a brilliant advisor on
Speaker 1: a lot of this stuff and negotiation and more than
Speaker 1: just a litigator or a fine arts lawyer, she's been
Speaker 1: very important. You mentioned White and the idea of the
Speaker 1: movable chairs. I have to ask how many of those
Speaker 1: chairs are stolen each year? Virtually zero? They really, you know,
Speaker 1: they deteriorate. They certainly they look like they're good enough
Speaker 1: to sit on, but not good enough to take. Well,
Speaker 1: that's thankfully that we knew it would go fine because
Speaker 1: when the first parks we've seen with chairs, these were
Speaker 1: actually for rent. They weren't for free. You were Green
Speaker 1: Park and St James Park in London. The Queen's entity,
Speaker 1: which is called Royal Park Enterprises put them out and
Speaker 1: we said, um, that's interesting. They're not going anywhere. I
Speaker 1: once asked somebody, why don't they disappear? Question? Everybody asked
Speaker 1: me about my parks and they said, well, they belonged
Speaker 1: to the queen. Who would take something queen's property? So
Speaker 1: so that yeah, that's more than just stealing a chair.
Speaker 1: That's a serious yeah. But also Brian parks so busy,
Speaker 1: it's hard to even to have a petty crime. We
Speaker 1: we took crime from five d felonies a year to
Speaker 1: zero there and it's it stays in the zero to
Speaker 1: one range. Every year there's something an assault. We had
Speaker 1: one weird incident with a guy took a machette out
Speaker 1: and hacked away at a woman, which is really upsetting
Speaker 1: because there are that was recent that there's some people
Speaker 1: in the streets. There's nothing you could do. There seems
Speaker 1: to be more than everyon more. Yeah, um, so let
Speaker 1: me keep plowing through this. So um, we haven't really
Speaker 1: talked about books, which is always a favorite topic. What
Speaker 1: what books influenced you? Um? Or what other books have
Speaker 1: you just found to be interesting and worth mentioning. I
Speaker 1: stopped reading books when we had kids, and then I
Speaker 1: said I gotta start again. So um, I'm I'm back
Speaker 1: reading again. Forty fifty books a year and they fiction. Uh,
Speaker 1: they haven't been influential. I just read them for escape.
Speaker 1: I like Trollope and Hardy and Fitzgerald. Um, and then
Speaker 1: management books. I've always spent half of my reading time
Speaker 1: reading management books trying to learn stuff in business. So
Speaker 1: Collins was interesting yeah, very good. I've read two of those.
Speaker 1: And UM Mark McCormick's books, which nobody mentions anymore, are
Speaker 1: really good. Whatever things. What they didn't teach you what
Speaker 1: Harvard Business School, it's kind of good horse sense about
Speaker 1: business management, UM and then UM Alan Weiss is a
Speaker 1: great one on pricing your consulting services, which Mackenzie X
Speaker 1: Mackenzie friend of mine recommended. What is Alan Weiss's book?
Speaker 1: What's her name of pricing? I'm forgetting the name value.
Speaker 1: I'll included on the page when we talked about And then,
Speaker 1: like most privatization guys, I've read UH and and RAN
Speaker 1: and it's it's a trial to read. But last week
Speaker 1: I had Michael Kovellan, who in his list of books
Speaker 1: mentioned Zone Ran and he says to me, He goes,
Speaker 1: I know you can't stand her, And I said, it's
Speaker 1: not that I can't stand her, it's that I was
Speaker 1: assigned at Las Shrugged in college and it was eight
Speaker 1: of the most miserable weeks of my life. The speech,
Speaker 1: it's a hundred and sixty pages one speech is it's
Speaker 1: it's brutal. I kind of semi minored in English and
Speaker 1: college and they emphasized when we did the Waste Land.
Speaker 1: There's no way this poem is regarded as one of
Speaker 1: the great trials of English literature without the editor, who
Speaker 1: I think was as a pound um. And there's no
Speaker 1: way Fitzgerald was any good without Max Purkis perkins Um
Speaker 1: and I Rand must not have had an editor who
Speaker 1: had a liability to say anything to her because needed
Speaker 1: to be edited, whereas The Fountain has a little more
Speaker 1: under control and under Atlas Shrugged. I never I basically
Speaker 1: I had a similar experience with Stephen Um what's his
Speaker 1: name with the stand Um. I got through the stands
Speaker 1: and everybody loves loves the author, and um trial, I
Speaker 1: just hated the four fifths of the way through. The
Speaker 1: whole book takes us crazy turn and it goes off
Speaker 1: in a different direction, and I'm like, wow, you just
Speaker 1: set me up for eight hundred pages and pulled the
Speaker 1: rug out from the other um I've read for enjoyment.
Speaker 1: I've read Philip Roth. I'm within unfortunately two or three
Speaker 1: of finishing all of his novels, and Just the Door
Speaker 1: was the story of my childhood. So I com He's
Speaker 1: got a funny story about Fortnoy's complaint that he tells
Speaker 1: in one of the films about him, where he told
Speaker 1: his mother he sat her down deliver or something else. No,
Speaker 1: he said, you know, this is going to be very
Speaker 1: upsetting to you, but there's a book that I just
Speaker 1: finished that is going to be a massive hit and
Speaker 1: it kind of makes a little bit of fun of
Speaker 1: our family, and I just wanted you to understand. He
Speaker 1: explains the whole thing, and then um, they go away.
Speaker 1: So after his mother died, he asked his father years later,
Speaker 1: what what was mom's reaction after I told her that
Speaker 1: I was going to have this huge hit and be
Speaker 1: a celebrity, she said, he said, she started crying, and
Speaker 1: he said, I knew it. I knew what. I knew
Speaker 1: she'd be upset, he said, not about what you think.
Speaker 1: She started crying because she thought you were having delusions
Speaker 1: of grand My son is crazy. He thinks he's gonna
Speaker 1: be a famous lot. But no, calm, it's about the actual. Uh,
Speaker 1: that's not what she was concerned about. And that American
Speaker 1: Pastorals my favorite, my favorite, and a lot of people's
Speaker 1: never read it. Oh, it's it's fibulous if you're interested
Speaker 1: in new work. Six or eight of them really have
Speaker 1: fabulous new work stuff. In fact, he had an exhibit
Speaker 1: in New York UM the library where he first worked
Speaker 1: as a young boy. He um had an exhibit there
Speaker 1: about his family and childhood. So I know, I gotta
Speaker 1: get get you out of here in the next minute
Speaker 1: or two. Let me jump to my last two questions.
Speaker 1: So a millennial or a new college graduate coming out
Speaker 1: of school who are interested in pursuing your career path,
Speaker 1: what sort of advice would you give to that? I
Speaker 1: always tell him the first job isn't that important. What
Speaker 1: it is as long as your boss is a smart
Speaker 1: person and cuts you in on some of the actions.
Speaker 1: So I had an internship or two where I was
Speaker 1: put in the back room, and then I had an
Speaker 1: internship or two where I was included in the work
Speaker 1: of the office. So that's what we do with our interns.
Speaker 1: So get a job that's interesting to you on your
Speaker 1: career path. But it doesn't matter so much who you're
Speaker 1: working for as to the company. It does matter who
Speaker 1: your bosses. Look for a really smart boss who can
Speaker 1: teach you certain things. And then at that point, I
Speaker 1: often say to people, time to be an entrepreneur, and um,
Speaker 1: get out there. You are my son and daughter for
Speaker 1: assuming that route. And my wife's quite an entrepreneur to
Speaker 1: in our own field of our laws. So um, it's
Speaker 1: easy to fail when you're young and you get up,
Speaker 1: dust yourself off and start over. Tougher to do that
Speaker 1: when you're a little older. And our our last question,
Speaker 1: what is it that you know about the development and
Speaker 1: management of public space today that you wish you knew
Speaker 1: back in the late nineteen eighties when you were starting
Speaker 1: two or three things? The programming didn't occur to us
Speaker 1: until we opened Briant Park. Um, and the insights I've
Speaker 1: had about managing the profit and laws statement for a
Speaker 1: cause that public entity only occurred to me over time.
Speaker 1: So I probably had some dead ends and wasted a
Speaker 1: little money early. Um, but UM, no one particular insight,
Speaker 1: it just um it took a lot of uh reading
Speaker 1: and travel. One thing I would certainly say is you
Speaker 1: need to travel a ton. If you do your same
Speaker 1: path to work every day, you're not going to have
Speaker 1: insights occurred to you. You need to get out and
Speaker 1: see what other people are doing. I kind of knew
Speaker 1: that from the beginning a little bit, but it's become
Speaker 1: more instrumental as time has gone on, Dan, thank you
Speaker 1: so much for being so generous with your time. This is,
Speaker 1: this has been fantastic. Before I go, I would be
Speaker 1: remiss if I didn't think my head of research Michael Batnick,
Speaker 1: and my producer slash engineer today Charlie Vollmer. Uh, you've
Speaker 1: been listening to Masters in Business on Bloomberg Radio. I'm
Speaker 1: gonna do that again. I'm Barry Rihults. You've been listening
Speaker 1: to Masters in Business on Bloomberg Radio.