Eran Polack
Chief Executive Officer and Co-Founder of HAP Investments
What project currently under development will most transform New York City? (And why?) I don’t think there is one project that is transforming the city. Instead I see several projects continuing the trend of revitalizing different areas of the city. The Hudson Yard project is creating a new center for businesses and residents in Midtown West. Also, the World Trade Center is showing strength and the ability to bounce back from a crisis. Lastly, all the new projects in the Bronx are showing the endless demand for real estate in New York City.
Post-Brexit, will New York come out ahead? And what are your thoughts on investing in London? London is a tax “safe heaven” for foreigners who moved there. New York City is definitely not like that, so the fact that prices for real estate are declining in London and that New York City is not a tax shelter for foreigners, leads me to believe that the Brexit won’t have a big influence on New York City.
Who’s to blame for the 421a debacle? Everyone and no one. 421a is a very important program for the city supply of affordable apartments and jobs in New York City. Also, it makes it easier and more profitable for investors, both domestic and international, and developers to participate in real estate.
Has the hotel bubble already popped, and what does that mean for hospitality?I think that I can only answer that question for the long run. New York City is the easiest city to be a tourist in since everybody speaks English—not like Paris where most of the people speak French. The signs in the street are in English and not in Chinese as they are in Shanghai; the menus in restaurants are written in English and not Italian as in Italy. Countries around the world are going through major changes, and I think that in a few years everyone will shift to a four-day workweek giving people more free time to travel, and New York City will keep on being one of the top sites for tourists. So in the long run the hotel and hospitality business will continue to be strong and successful.
What’s the plan (or should be the plan) if WeWork goes belly up? I think WeWork is a very innovative company that has a creative, sustainable business model. If something goes wrong, landlords will find alternative methods and platforms to find tenants for their office space.
If you were going to get in on the ground floor in any market, where would you go? London.
If you were to take over Stuy Town/Peter Cooper Village, what would you do with it? The Stuy Town project is huge and has so much potential but has failed in the past. In order to be profitable, the business model must be balanced. I would wait for the J-51 to expire, and then I will preserve one-third of the units as affordable, maintain one-third as market rate rentals and sell one-third as condos.
How would you like to reform LEED, WiredScore and StarEnergy? Attainable sustainability goals are a must for all project types—a responsibility for all types of developers.
What do you think about developers getting into the lending game? Are you lending? Have you borrowed from a developer-turned-lender? Would you? I am not lending. I do believe that this is a positive thing because the developers that are lending money have a vast understanding and knowledge of the real estate industry. On the other hand, the developers will always have a big appetite to own the property.
Looking to the 2017 election, what should the next mayor do to help NYC? I hope that the next mayor will be able to work with the governor, as well as New York City developers to bring back the 421a program in a similar way or create a new program that offers similar benefits for developers.
If you weren’t in real estate, what would you do? I would be a teacher. I place a tremendous value on education and continued learning for everyone. I think that you’re never too old to learn something new.
Lightning Round
Kanye or Taylor Swift? Middle Eastern music
House of Cards or Game of Thrones? I don’t have time to watch TV, so I haven’t watched any
Hillary or Donald? I can’t vote
Mission Chinese or Jean-Georges? Jean-Georges
Empire State Building or 1 World Trade Center? 1 World Trade Center
The New York Times or The New York Post? Times
South Shore or Jersey Shore? Miami Beach
iPhone or Android? iPhone
Uber or yellow cab? Uber
Hamilton or Book of Mormon? Book of Mormon
Martini or Old Fashioned? Martini
Buy, sell or hold? Buy, sell and hold