Thursday, March 14, 2013

"Cutthroat" executive MaryAnne Gilmartin set to take over Forest City, perhaps this month

A long profile of Forest City Ratner's MaryAnne Gilmartin in the 3/1/13 issue of The Real Deal is headlined MaryAnne’s moment: The Forest City Ratner exec could be elevated to CEO this month, and industry sources say they expect big things.

Gilmartin didn't cooperate, but a a chorus of people chimed in. The publication reported:
Sources say that’s likely to mean that [Bruce Ratner] 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.
That said, I'd point out that such an arrangement does not preclude Ratner from, say, moving forward with a bid on the Seward Park urban renewal project or, as the New York Post reported, a plan to shrink the Nassau Coliseum capacity to revamp the facility as an entertainment venue.

Steven Spinola, the president of the Real Estate Board of New York (REBNY), told The Real Deal that Gilmartin is a better shmoozer:
“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.”
Gilmartin's rise

In her post-college Urban Fellows post at the Public Development Corporation (now NYC Economic Development Corporation) Gilmartin began in public relations and moved into policy, working on corporate retention, structuring deals, including tax breaks and other incentives, to keep companies in the city.

She helped get Bear Stearns to move to Ratner's MetroTech. A few years later, after working at the firm Grubb & Ellis, she joined Forest City in 1994, working on MetroTech, Times Square, and then the New York Times building.

The Real Deal reports:
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,” [broker Mary Ann] 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.
Then came New York by Gehry at 8 Spruce Street and Atlantic Yards.

Massaging the Atlantic Yards succession

The publication reports:
Atlantic Yards, unveiled in 2003, was already contentious when the company’s point person on the project, James Stuckey, left in 2006 [actually 2007] 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.”
Um, let's recall why Stuckey left so abruptly. As the New York Post reported, it was after internal complaints of sexual harassment. So much for Forest City's claim, in a June 2007 press release, that "For the past few weeks FCRC has prepared for Mr. Stuckey’s departure to create a seamless transition."

Also, consider that the "viable structure" was lacking six months after the project received its official approval in December 2006.

A voice of dissent: she "is cutthroat"

The Real Deal quotes longtime Develop Don’t Destroy Brooklyn spokesman Daniel Goldstein:
“She will do whatever she can to make her company succeed in her projects,” he told TRDlast 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. [*see Goldstein's addendum at bottom]
“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.”
Is Goldstein merely some disgruntled foe?

Consider that an architect who ran afoul of Gilmartin regarding the early modular plans reported in January 2011 to an associate, according to documents filed as part of litigation, "I had an unpleasant conversation with MaryAnne. I was told they know the same people I know and they’ll make sure to fuck me whenever possible."

More of the same

The Real Deal reports that, while Forest City’s Bob Sanna will continue to oversee the modular plan, he will now "officially report directly to Gilmartin instead of Ratner."

And now that Atlantic Yards has passed a big hurdle, they can look at other plans, including Seward Park:
“I don’t expect Bruce to disappear,” [Jed] Walentas [of Two Trees] 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.”
The dynamic, indeed, has been set for a long time.

Goldstein's addendum: not negotiating for himself

Goldstein wrote to follow up:
To clarify the reporter's shorthand, "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."

I wasn't hoping to negotiate. In Feb 2009 when the project was on the ropes due to the financial crisis and the opposition, when Gehry was being dropped, out of the blue I was contacted by email by Ms. Gilmartin. She requested a meeting. I hoped, rather optimistically, that she was considering a negotiated compromise with the opposition on the entire project. And if she did want to meet for that purpose, this would be a preliminary meeting before bringing the issue to DDDB leadership and other community organizations involved in opposing the project.

Because of this hope, I agreed to meet with her, in my home. My interest was not in a "buy out" as we still had legal recourse to stop NY State from taking our home (and the homes of others) by eminent domain. We had one more potential round in the State's high court, though whether or not they'd take the case at that time was their discretionary decision.

So when she came to my home, with Jane Marshall, it quickly became clear that they were there hoping I was wavering and that they could "buy me out." There wasn't much to talk about once that became clear, especially as she used the threat "we know how much your home is worth now and we know it will be worth a lot less in a few months," to scare me. She didn't scare me.

In retrospect, their hope that we would sell and our hope that they would compromise were both wildly optimistic fantasies.

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