A few nights later, in a nightclub owned by Webb & Knapp that Big Bill used as his evening office, the trio made a deal to give the UN an option on about two-thirds of the X City land for $8.5 million. The next morning, Rockefeller Jr. agreed to donate that sum, and within a week the General Assembly accepted. Zeckendorf walked away a hero with a $2 million profit for Webb & Knapp and control of four-plus surrounding acres.
The deal made Big Bill the most talked-about real estate operator in America. In 1951, the New Yorker’s E. J. Kahn Jr. sanctified his new status in a two-part profile that described him as “unusually imaginative, venturesome, unpredictable, ambitious, and resourceful,” as well as volatile, sentimental, and, understating significantly, “fond of publicity.”
A few years later, in 1956, Bill Zeckendorf Jr. would forge another family tie with the UN when he married Guri Lie, the daughter of Trygve Lie, the Norwegian foreign minister who was serving as its first secretary-general. William Lie and Arthur Zeckendorf are the products of that union.
Though he’d spent part of his childhood at the Dorilton, Big Bill was no fan of Manhattan’s West Side. In 1946, he and Marion were living in a four-room, seventeenth-floor penthouse in a Webb & Knapp building on Seventy-Second Street near Madison Avenue when he dreamed up a scheme to cover the entire West Side from Twenty-Fourth to Seventy-First Streets west of Ninth Avenue with another platform, this one of nine hundred acres and twelve stories tall, covering 144 square blocks (about the area of Central Park), on which he proposed to build an airport with three parallel runways. He figured the cost at $3 billion, or about $33 billion today.
At the same time, he was offered the chance to buy a group of buildings off Central Park West, including the last home of Durland’s Riding Academy. Initially, he declined. He wasn’t interested in residential real estate, “and the west side was déclassé,” he wrote. “We would rather buy land at higher prices and get a better long-term deal on Park Avenue.” But a few weeks later, stuck in traffic on that very block, he wandered into the equestrian center and, eyeing its dimensions (two hundred feet long and a hundred feet wide with a forty-five-foot vaulted ceiling), had a vision of selling it to one of the then-new television networks for a studio. But neither NBC nor CBS wanted it. Finally, the founder of the Life Savers candy empire called. He’d just bought a radio network and wanted the riding academy as a television production facility. It eventually became the home of the ABC network, which years later would sell a piece of land nearby and give Big Bill’s grandsons their first opportunity to sell luxury apartments to New York’s wealthiest.
After the UN deal, Zeckendorf had become a Rockefeller family real estate consultant and grown particularly close to Nelson, whose taste in modern art mirrored Zeckendorf’s own predilections. He believed in modern architecture and had already worked with a number of talented practitioners, including Le Corbusier and William Lescaze, when, in 1948, Webb & Knapp began spreading its wings as a developer. So Big Bill decided he needed an in-house architect, and not just a hack or a wellborn dilettante, but an innovator. Nelson Rockefeller introduced him to a Museum of Modern Art staffer who spent the next year scouting talent before the eminent architect Philip Johnson recommended an assistant professor at Harvard, a young Chinese named Ieoh Ming Pei, who impressed Big Bill not just with his imagination and intelligence but also because they were both gourmets and oenophiles. It didn’t hurt that, like Zeckendorf, both Pei and his father had been born in Chinese astrology’s year of the snake, which supposedly confers wisdom, charm, and intuition.
Pei’s first job as in-house architect was the redesign of Webb & Knapp’s shabby two-story corporate office atop an office building on Madison Avenue. The centerpiece of its top-floor lobby became Zeckendorf’s own office, a vertical, teak-paneled, windowless cylinder twenty feet in diameter with colored lights, which Zeckendorf could change according to his mood, set into a ring of skylights around the top. A private, stainless-steel elevator dubbed the Bullet sat inside its own cylinder-within-the-cylinder and rose to a larger, turretlike, glass-walled penthouse executive dining room, bathroom, and kitchen. Members of Pei’s staff, which immediately began to grow, even designed custom furniture for their employer-patron.
At the time, Nelson’s father was renting a huge duplex apartment that sprawled over thirty-plus rooms at 740 Park, but he was bedeviled by his downstairs neighbor, Clarence Shearn, a lawyer, former judge, and longtime associate of William Randolph Hearst, and Shearn’s second wife, Dorothea, a fortune hunter.II Before she entered Shearn’s life, Junior had made inquiries about taking over Shearn’s apartment. Shearn and later Dorothea would regularly tease their immensely wealthy upstairs neighbor with that enticing prospect.
After buying out his remaining Webb & Knapp partners in 1947 for a reported $6 million in cash and collateral, Zeckendorf bought the shell of a public company controlled by another of Rockefeller’s 740 Park neighbors, taking Webb & Knapp public in what was called a reverse merger. Nearly simultaneously, Thelma Chrysler Foy, an heiress to the Chrysler automobile fortune, thought she’d made a deal with Clarence Shearn to buy the lease on his apartment. Shearn was elderly and becoming senile; his wife’s behavior was erratic, too. And at the time, the owner of 740 Park, James T. Lee, was teetering on the brink of insolvency, causing his tenants, Rockefeller first among them, no end of anxiety. Then, seemingly out of nowhere, Webb & Knapp bought 740 Park from Lee and the iconic Chrysler Building skyscraper from the Chryslers. It wasn’t long before Foy’s two Chrysler brothers moved into 740 Park. Cryptic comments by Zeckendorf to a reporter indicated there was a connection—details unknown—between these deals.
Rockefeller Jr., typically portrayed as straitlaced and pious, was also crafty and capable of duplicity—and it’s apparent he was operating behind the scenes, paying close attention to, if not overtly manipulating, his sometime ally Zeckendorf. He still wanted the Shearn apartment; getting rid of his wacky neighbors would be an added benefit. But he had a greater objective: late the same year, he bought 740 Park from Zeckendorf, made it a cooperative, and sold apartments to most of his neighbors.
Just before Rockefeller bought the building, Shearn, in decline and near death, had stopped paying his rent and was facing eviction as Thelma Foy hovered just offstage. But Rockefeller wanted the apartment, too, and suddenly, or so Dorothea Shearn claimed, so did Zeckendorf, though it is possible he wanted it for Foy and not for himself and his wife. All three were circling the apartment when Shearn died and Dorothea’s slender grasp on sanity loosened. She was forced out, Rockefeller sold the apartment to Foy (though Rockefeller would later buy it from her, intending to combine it with his, but ultimately using it only for storage). Zeckendorf continued trying to buy an apartment in the building, making a serious play for another not long afterward, but cryptic letters between Rockefeller and the building’s manager indicate that Big Bill had somehow been deemed unsuitable for the polished crowd in the new cooperative. That wouldn’t be the last time a Zeckendorf circled 740 Park, but Big Bill would be long dead before the next chapter of that story would play out.III
The 1951 acquisition of that publicly traded company launched the third stage of Big Bill Zeckendorf’s real estate career, which would play out over the next decade. Immediately, it elevated him from merely rich to seriously so. To celebrate, he bought his limousine, his DC-3 airplane, and his estate in Greenwich, which began as thirty-five acres (formerly owned by the reclusive “Witch of Wall Street,” Hetty Green), but after a Zeckendorf-size redevelopment project, he more than doubled his acreage by filling in marshes. He also added a twenty-four-thousand-bottle wine cellar—said to be the largest in the country—beneath a new swimming pool.
A devotee of the telephone, he kept a battery of them in his office, was on them all day, and eventually owned not one but two of the very first car phones, actually ship-to-shore instruments adapted for his purposes. He also owned fifty handmade suits. But he was generous, not stingy, with his wealth and
would make bad deals simply so old friends could make money. One associate said he had “the memory of a bull elephant, the heart of a baby and the guts of a brass monkey.”
With frequent backing from his new friends the Rockefellers, Big Bill could not only throw off an idea a minute but could also make some of them real. Despite having been frustrated in his attempt to join “Junior” Rockefeller as a resident of 740 Park, Zeckendorf continued to work with his family, even embarking on a five-year operation in concert with Junior’s youngest son, David, who had recently joined the Chase National Bank, which was effectively run by his family, to relocate its headquarters and those of several of New York’s other large financial institutions. Their grand purpose? Ensuring the permanence of Manhattan’s downtown financial district, centered around Wall Street. They did such a good job—relocating not only Chase but Chemical, Morgan, and Hanover banks—that not even the September 11, 2001, terrorist attack on the neighborhood could alter Wall Street’s identity.IV
In the late 1950s, Zeckendorf also reinvented Webb & Knapp’s airport, the same one Charles Lindbergh had flown out of on his pioneering first transatlantic flight to Paris in 1927, as Roosevelt Field, the largest suburban shopping mall in America, and entered the field of urban redevelopment with a five-hundred-acre project in Washington, DC. At the time, Zeckendorf recalled, “It was obvious that the central core of every one of our major cities was falling in on itself,” with no new construction to replace older, oftendecaying buildings. After World War II, many urban dwellers, back from fighting and starting families, fled those cities for new suburbs, and new businesses followed them, supercharging the phenomenon known as white flight, though in fact the whites who fled the cities were replaced not only by the descendants of Southern slaves, but also by less skilled, less educated whites who “had for several decades been leaving the farm country for work in the cities,” Zeckendorf observed. “Because they were poor, they crowded together, which of itself tends to create a degree of urban blight.”
The so-called urban renewal movement, designed to eliminate and replace slums, was codified just after the war in the Title I of the Housing Act of 1949. It allowed cities to use the legal doctrine of eminent domain to buy up slums, clear them, and offer the land at cut-rate prices to developers. In exchange, they promised to build low- and middle-income housing intended both for veterans returning from World War II and the nation’s poor.
Urban renewal would ultimately be a mixed blessing and a political football. It was blamed for a host of dehumanizing urban ills—destroying businesses, disrupting lives, displacing communities, increasing racial segregation, and creating breeding grounds for crime and social malaise in the dreadful housing projects that, far too often, replaced the slums. “The buildings were not the problems,” says Roberta Gratz, author of The Battle for Gotham and a journalist, neighborhood activist, and longtime resident of the Century on Central Park West. “The problems were social and economic. Urban renewal was not a response to problems. It was a means of taking property and stimulating development that profited a lot of people. The displacement of a million people did nothing for people with problems. In fact, it only exacerbated them.” But it also had undeniable economic and cultural benefits, though at the time they were only promises of a better future.
Eventually, urban renewal changed much of the neighborhood once called Bloomingdale, which had long since turned from a valley of flowers into a pit of despond. Romanticized in the iconic Broadway musical West Side Story, based on its street life—with the Irish and Puerto Rican street gangs called the Jets and the Sharks battling for power, respect, and love—the West Side’s reality was somewhat different. “Except for West End Avenue, Riverside Drive, and Central Park West,” James Trager wrote in his book West of Fifth: The Rise and Fall and Rise of Manhattan’s West Side, the neighborhood “remained the depressed area it had been even before the Depression, a jumble of brownstone walkups, many of them rooming houses. . . . Hispanics were an ever-growing part of the population mix. . . . Blacks from the south were flooding into New York . . . where they found themselves in competition with Puerto Ricans, often in violent confrontations, for jobs and welfare payments. The resulting fear, combined with the impact of black and Puerto Rican children on public schools, persuaded some eight hundred thousand middle class whites to flee New York for the suburbs.”
Urban renewal was designed to change all that, and Zeckendorf and Webb & Knapp played a significant role in it, in Denver, Colorado, Washington, DC, Montreal, and finally three notable Manhattan projects conceived of by the city’s omnipresent and controversial master planner, Robert Moses. The first was Kips Bay Plaza, two monumental, reinforced-concrete slabs of apartments designed by I. M. Pei. Next came Park West Village, the redevelopment of six blocks of tenements on the upper end of Central Park West. Finally, he built Lincoln Towers, eight twenty-eight-story, middle-class apartment towers at the northern end of Lincoln Square, just above today’s Lincoln Center.
The last was part of Moses’s grand scheme for what he called “a reborn west side . . . marching north from Columbus Circle and eventually spreading over the entire dismal and decayed west side.” But Zeckendorf wasn’t proud of Lincoln Towers. A financial partner, the Lazard Frères investment bank, removed Pei from that job in an effort to keep costs down. “I am ashamed of it,” Big Bill said bluntly.
Zeckendorf stumbled again in 1953, when Webb & Knapp, by then allegedly worth a quarter of a billion dollars, tried to go into the hotel business by buying the national Statler chain, which did business in eight cities. He was outmaneuvered by the hotelier Conrad Hilton, who snatched them away, but could console himself with other accomplishments.
In January 1958, Twentieth Century-Fox announced plans to develop its huge studio property just west of Beverly Hills into a city-within-a-city. Zeckendorf was sure he was the only man who could build it, even though Webb & Knapp was, Zeckendorf admitted, “spread thin across America.” Lazard Frères once again signed on as a financial backer with the right to walk away and demand its money back. Zeckendorf began planning what would eventually become Century City, the largest privately financed development in American history.
Then, likely still smarting from being outsmarted by Conrad Hilton, Zeckendorf bought a ninety-thousand-square-foot piece of land between Fifty-First and Fifty-Second Streets on Sixth Avenue, leased or bought most of the two blocks to the north, and committed to build a two-thousand-room New York hotel—the first big one in New York since the Waldorf-Astoria in 1931—which was going to require all the cash Webb & Knapp had on hand. So he made a deal to sell his contract to develop Century City to another developer. But then, the buyer backed out, and simultaneously Lazard asked for its money back. It was the first sign that Zeckendorf’s wheeling and dealing might have a downside. “If we get hit by a depression, or make some bad mistakes, we could be selling hot dogs around here,” worried his twenty-nine-year-old son and namesake, Bill Jr. “We live on borrowed money.”
Big Bill’s boy had started out working summers at Webb & Knapp while a student. After realizing he was “a terrible actor,” the stagestruck Bill Jr. studied theatrical production while in college in Arizona, but then he went back to work for his dad until he enlisted and became an Army Intelligence corporal during the Korean War in the early 1950s.
When he came back home, his father put him in charge of renting out a three-quarters-empty apartment complex in San Diego. Working with the navy, he filled it with servicemen and their families and was a year later named a vice president and his father’s “companion and adviser of all new developments,” or so Big Bill later wrote. “I would say that’s an exaggeration,” says Bill Jr. now. “He kept me informed of everything he was doing.” Bill Jr. worked on urban renewal and Canadian projects at first, but eventually began doing deals and working on building projects all over North America. On a trip to Europe, a mutual friend introduced him to Guri Lie; they married early in 1956 and eventually mov
ed into the same East Seventy-Second Street building where Big Bill and his wife had lived. Later, they moved into 30 Beekman Place, a rental building bought in the name of Marion Zeckendorf in 1952, where they eventually took over Big Bill’s I. M. Pei–designed nine-room penthouse. Pei and his family lived there, too. Bill Jr. and Guri stayed until their second son, Arthur, was born. Shortly afterward, they split up, and Guri and the children moved to 1100 Park Avenue, a 1930 cooperative on Carnegie Hill, where she raised the boys.
A big man like his father, two hundred pounds and five foot eleven, Bill Jr. found a way to combine the two passions that were also his inheritance, real estate and showmanship, in a new company, Zeckendorf Hotels. “The nearest thing to a combination of real estate and the theater is a hotel,” he said. As that subsidiary’s president, he presided over six hotels his father bought in Manhattan, then announced plans to build the Zeckendorf on Sixth Avenue.
“I like to say it was my project,” says Bill. “It wasn’t. It was my father’s. I worked on it, but he always did the financing.” Just as Bill Jr. was getting settled into his new jobs, his father’s penchant for dreaming, scheming, borrowing, and stretching himself and his equity thin began to threaten both the business he’d built and the image of success he’d cultivated since joining Webb & Knapp. Early in February 1959, a front-page story in the Wall Street Journal, though couched in admiration of an entrepreneur apparently at the peak of his power, revealed that Webb & Knapp had taken on a nine-figure debt and was losing money for the first time since going public.
No longer able to borrow freely, the Journal reported, Zeckendorf had begun using his own money to fund ongoing construction projects worth half a billion dollars. His dire need for cash, and the layers of complications in his deals, led him to take in a financial partner under onerous terms, and to borrow from investment banks and private investors at short-term interest rates that would eventually run as high as 24 percent. So young Bill added overhead reduction to his portfolio of responsibilities; Webb & Knapp then had a staff of four hundred and spent about $8 million a year on operations and had seven offices across the country and three corporate airplanes.
House of Outrageous Fortune: Fifteen Central Park West, the World’s Most Powerful Address Page 7
