House of Outrageous Fortune: Fifteen Central Park West, the World’s Most Powerful Address

by Gross, Michael

  The rest of the welcome bids matched Avlon’s initial request for a nine-figure number starting with a 3, with Related and Elad in the vicinity of $350 million and Vornado on the low end, around $320 million, or so the Zeckendorfs heard. Briefly, Will and Arthur worried that either Elad or Related might top their bid on a second round. At Goldman Sachs, they’d thought the deal was Related’s to lose. So they waited to see what would happen next. They didn’t dare call Avlon.

  About a week later, John Avlon finally called. “ ‘Can you meet me tomorrow morning, nine a.m.?’ ” Will recalls. “Luckily Ofer was in town, and we got the Goldman people together and went over to John’s law firm. John loved formal meetings, so it was a big formal meeting.” Again, he told them where to sit. “With Will and me sitting next to him,” Arthur adds. Also in the room were a clutch of lawyers and Samuel Kellner.

  After they dickered over a few small issues, with Ofer leading the horse-trading, Avlon asked the Zeckendorfs to step into a side office, where he told them their offer would be accepted if they’d sign the contract and pay a deposit within twenty-four hours. “Clearly, the team, the ability to close, made a big difference to John,” says Arthur. “He obviously likes Whitehall and Goldman Sachs, he knows the Ofers from shipping. And Will and I have been with him—”

  “Seven years,” Will adds, laughing. Back in the conference room, Will hastily scrawled on a legal pad and passed it around. If we can conclude tomorrow, they will postpone “parallel bidding,” it said. They would like to end tomorrow w/us. They are prepared to call a vote of their group tonight. Then, Will, Arthur, and Metz left the lawyers behind “to clean up the documents” and rushed off to arrange a wire transfer of that 10 percent deposit, $40 million. Ofer, who’d once lost a deal after leaving a negotiation to let the lawyers finish the job, was disinclined to make that mistake again and decided to order a Chinese take-out lunch and stay until every detail was dealt with. “So the next twenty-four hours is a nail-biter because you don’t know what’s gonna happen,” Will continues. “But John’s a man of his word, and so we reassembled the next morning, the wire had hit their account, and it was signed, that was it.” Listening to his brother tell the story, Arthur Zeckendorf starts to giggle, for a moment a child recalling the moment he opened the best Christmas present ever.

  The closing, delayed by summer vacations, took place in August 2004. Two days later, a small story about the record-breaking sale appeared in the New York Times—disappointing the Zeckendorfs both with its placement inside the local-news section and with how the deal was portrayed. Real estate reporter Charles Bagli had the price (“more than twice the going rate for land in Manhattan on a per-square-foot basis,” he wrote) and identified the mysterious sellers as the Goulandris family, but he also intimated that the Zeckendorfs had overpaid, describing the price as risky and quoting Donald Trump’s calling it crazy. “The story didn’t say, ‘The losing bidders said we overpaid,’ ” Arthur Zeckendorf notes wryly. “And Whitehall said, ‘Who cares what losing bidders say.’ ”

  * * *

  I Early in 2001, the Zeckendorfs and their partners would strengthen their hand by buying Feathered Nest, a rental agency, and Halstead Property, a midmarket brokerage, passing the giant Corcoran Group to become the second-largest real estate brokerage in New York. Only Douglas Elliman was larger.

  II In December 2002, the condo board would sue the developers for what it deemed faulty construction, and owners, including the French-luxury conglomerateur François Pinault, followed with their own suits. The litigation proceeded for years, but prices in the building were unaffected, and in January 2006, Pinault sold his duplex for $22 million.

  III In 2005, the Zeckendorfs agreed to pay $430 per square foot, or $37 million, to the neighboring Grolier Club on Sixtieth Street and later made a deal with Christ Church, a Methodist congregation on the corner of Park Avenue, for their air rights—each transaction billed as the highest amount ever paid for such a purchase. Plans have been filed for a fifty-one-story building designed by Robert A. M. Stern.

  IV Along with the Mayflower block, Avlon was going to sell two properties on West 102nd Street that would allow the winning developer what was called an inclusionary housing bonus. “By building a 36,000-square-foot building for us, they gained 183,000 square feet FAR for zoning,” explains Carol Lamberg, executive director of the Settlement Housing Fund, a nonprofit that creates and maintains affordable housing. Ever since it opened in 2006, Semiperm, as the building would be called, has provided a home for twenty-three formerly homeless single-parent families, including thirty-five children, helping them learn to support themselves, seek education, care for their children, and become self-sufficient.

  Part Six

  * * *

  GROUNDBREAKING

  The best luck of all is the luck you make for yourself.

  —GENERAL DOUGLAS MACARTHUR

  “The whole thing was just a horrendous nightmare,” says Will Zeckendorf.

  He isn’t referring to the money that went out to pay the unfunded pension liabilities and severance for the remaining employees of the Mayflower. Nor the liquidation sale of the hotel’s furniture and fixtures—pedestal sinks, hotel art, chandeliers, and even the bronze mail-chute boxes and the swinging doors to the room-service pantry—that was held in November 2004, a month after the last of the guest rooms were shut down. The Zeckendorfs expected the auction would add $1 million to their war chest—but got about a fifth of that. “They come in and tell you you’ll get all this money,” Arthur recalls. “And you get nothing,” Will says, completing his brother’s thought. “We really got ripped off. That was a complete waste. Idiotic.”

  Idiotic, but not a horrendous nightmare. Zeckendorf saves that description for the four rent-regulated tenants still in residence after the hotel stopped renting rooms. The Zeckendorfs would eventually be allowed to demolish the Mayflower, but first they were legally responsible for paying those tenants a stipend and moving expenses or even relocating them. In cases where tenants kick up a fuss, that can take a grinding five years. But initially, at least, the Zeckendorfs weren’t worried; they had long-standing relationships with relocation experts, as well as profiles of the four compiled by the Mayflower’s staff. They also had a plan in case any of them balked: all four lived in the north half of the building, and since the Mayflower and the Plymouth had originally been built separately, disconnecting them would require little more than slapping up a wall in the lobby. In the best version of that worst-case scenario, demolition of the south wing would then begin and add to the discomfort of the lingering tenants. That was more a joke than a serious contingency plan, but circumstances were about to make laughs hard to find.

  The Zeckendorfs turned to Michael Grabow, a relocation lawyer, “to get the last four, four bachelors, out,” he says. “They’d been there thirty to thirty-five years each, each in a tiny little room.” Two were happy to take some money and run. One was ninety-eight and had relatives in Mexico. “After thirty-five years, he checks out with a single suitcase,” says Will. “Plus a million-dollar check,” Arthur adds, laughing grimly.

  The second, an aging show-business agent, also in his nineties, accepted a similar sum and disappeared. Then, things got complicated. Negotiations with the third dragged out, and when a deal was finally made, the tenant’s lawyer called to say that the tenant’s check should be made out not to David Jordan, as the hotel knew him, but to Arthur MacArthur. The Zeckendorfs spent the next weekend “just going nuts,” Will says, trying to confirm the mystery man’s identity and ensure they were paying the right person. What they learned astonished them.

  David Jordan’s real name was Arthur MacArthur IV, and he was the son of the World War II general Douglas MacArthur. Arthur, in his late sixties, bore a tremendous burden: the name of the general’s father, his brother, and an ancestor who had fought in the Civil War. Born in Manila in 1938, Arthur IV appeared four years later on the cover of Life magazine, while his father
was running the Pacific war theater; later, he ruled a defeated Japan. After that, Arthur lived with his parents at the exclusive Waldorf Towers on Park Avenue, but dropped from sight following his father’s death in 1964.

  MacArthur fans had tried without success to find him ever since, while recalling a sensitive twelve-year-old with a mind of his own who wanted to march to a different drummer. His father’s biographer, William Manchester, observed that Arthur “lived for his music, a fugitive from his father’s relentless love.” In these comments was a hint of what the Zeckendorfs learned: Arthur MacArthur might be gay and may have disappeared in order to lead his own life in a way that would not reflect on his father’s legacy. “He was extremely shy, meek, quiet,” says Grabow, noting that MacArthur avoided eye contact. “You knew right away he had social problems.” Satisfied, the Zeckendorfs cut him a check, which he used to buy a $650,000 condominium a few blocks away.I It was the first and last time his name appeared in public records as an adult.

  Compared to the last tenant, MacArthur was easy. “Herbert Sukenik’s profile was a nightmare,” says Will Zeckendorf. “Hugely intelligent, a PhD, unmarried, embittered, a loner, disconnected from society, and too smart for his own good. He was not a poor man; he had independent means. And we knew all that up front.”

  Sukenik had lived for about thirty years atop the Mayflower, two flights of fire stairs above its highest elevator landing. His tiny room had “mold growing up the walls,” says Will. At first, he sounded as if he’d be easy to please. “I don’t want money,” he told the developers. “I just want a new apartment with a park view, okay?” The Zeckendorfs assigned a Brown Harris Stevens broker to find one for him and hoped it would quickly be over. But then months went by.

  Herbert J. Sukenik was born in the Bronx in 1930 to an American branch of a prominent Israeli family. His father’s brother was the archaeologist who first recognized the importance of the Dead Sea Scrolls. His cousins were equally accomplished. Herbert’s father, conversely, was a pharmacist who’d been arrested and found guilty in the 1950s for selling amphetamines without prescriptions.

  Herbie, an academic whiz kid, breezed through Cornell University in just three years, earning a physics degree, made Phi Beta Kappa, and went on to get a master’s in physics, a PhD in physics, and an MD. After a stint at the General Electric Research Laboratory, where he studied nuclear magnetic resonance, he was named chief of space medicine at Martin Company’s Space Systems Division. Sukenik never married. His closest relationship seems to have been with Irwin Shapiro, now an astrophysicist at Harvard. They’d been frat brothers at Cornell. Shapiro called Sukenik annually. “He never called me,” says Shapiro, who thinks his friend had issues. “His father was a strange, strange, very quiet man. A total mute. In another world.”

  Sukenik’s career spiraled downward after his stint in space science. In the midsixties, he moved east to work at Massachusetts General Hospital, where he played a role in its earliest installation of computers. “He took a job that was far beneath him and he became more and more isolated and angry,” Shapiro says. “He was angry at the world, but, I thought, angry at his father.”

  In August 1974, Sukenik moved to Manhattan and a room at the Mayflower Hotel. “He was very reclusive,” says a younger relative, Herbert Chirlin, who recalls overhearing older relatives talk of Sukenik’s bitterness at never living up to his potential. He sometimes worked as a school doctor, but, Shapiro thinks, he finally took to his room and rarely left.

  Sukenik was seventy-three when he met Michael Grabow in that 350-square-foot room, which had a kitchenette, a bathroom, four exposures, and fabulous views of Central Park and both the East and Hudson Rivers. But its windows were so filthy, those views could barely be seen. He shared the place with thirty years of scientific journals. It was “a wreck, a mess,” Grabow says. “Clothes everywhere. Papers, magazines, two computers. He had to clear chairs to sit on.” Grabow settled in and tried to get to know the Mayflower’s last holdout, who was short and balding, with a wild fringe of gray hair, kempt but not well dressed, with the “old-man smell” of someone who “didn’t shower much,” Grabow says. “He was clearly brilliant, but he didn’t dwell on any topic very long.”

  “I wasted my life,” the embittered Sukenik told Grabow in one of their many conversations over the next six months. His father had died while he was finishing his medical degree and left him just enough money that he didn’t have to work. “I could have been at the heart of research into CAT scans and MRIs,” Sukenik said. “I should have invented something like that. Instead, I’ve been up here thirty years doing crossword puzzles.” Grabow asked around and learned Sukenik was universally disliked by the staff. He never let anyone into his room to clean, even though he was entitled to maid service. “He was a bitcher, a complainer, an old, grouchy guy,” says a former Mayflower manager.

  “But he had fun with me,” Grabow continues. “He had a nice time beating me up.” Sukenik was strange but not stupid, and his computer had taught him all about the block on which he lived. He knew its precise acreage and how much the Zeckendorfs had paid, and he’d calculated the taxes, insurance, and carrying costs of the empty properties and recited them all to Grabow. “He understood his value,” the lawyer says. And he wouldn’t begin negotiations until his three fellow tenants were gone. “He knew the last man standing was very valuable.”

  When he finally got around to stating demands, there were many. Where would he move? How? Would he have maid service? The only thing he didn’t want was money. “He wanted to be pampered,” says Grabow. He called Grabow several times a week, often raising the bar. “You want me out?” he’d tease. “This is what I want.” Finally, an acceptable apartment was found.

  His key demand had been a park view, so the broker took him to the Essex House on Central Park South, the old hotel that had been partly converted into a condominium, and showed him a twenty-two-hundred-square-foot, two-bedroom unit on the sixteenth floor. Sukenik loved it. “It looks like a bed of green,” he rhapsodized, staring out at Central Park beneath him. Grabow sent Sukenik a letter spelling out their agreement: the Zeckendorfs would buy the condo and retain ownership, but he could have it for life, and they would even furnish it for him. The one demand they refused was free meals twice a week at the Essex House restaurant, then run by the world-renowned chef Alain Ducasse. Sukenik’s response to the letter was silence. “Which was not like him,” Grabow says.

  Then, David Rozenholc, a noted tenants’ attorney, called Grabow, and the moment he started talking, it was clear things had changed. Rozenholc told Grabow that Sukenik wanted more than the apartment and moving expenses. A lot more. Grabow hung up and called Sukenik. “I thought we had a deal,” he said. “We didn’t and now I have a lawyer,” Sukenik replied. He went on to confirm that he did now want money—even though he had no use for it, no kids, no charitable impulse, and didn’t want to leave it to his brother.

  The negotiation “was a game” for Sukenik, Grabow decided, and the Zeckendorfs decided to play hardball. As they’d planned, they separated the two halves of the building lobby and began demolishing the southern end. Sukenik’s response: “Oh, I love to watch construction.” Jackhammers began pounding away for hours a day. “I love the noise,” he said. The Zeckendorfs served Sukenik with papers setting in motion the multiyear demolition-related eviction process they’d hoped to avoid.

  Finally, it had all come down to a simple question, “ ‘Where’s the cash?’ ” Will recalls. “This is just a break-the-phone moment. We’ve got a fifty-two-thousand-square-foot property with one tenant.” After two months of silence, the Zeckendorfs turned to an ambassador, a third lawyer who knew Rozenholc. “And finally, we get a number, which is big enough to break another phone.” But at last, they had a deal.

  Fortunately, during Sukenik’s extended silence, they’d bought the Essex House condo “because we cannot wait six more months to find this guy another one,” Will continues. That set them back $2 m
illion. They won’t reveal the additional sum they finally paid Sukenik, citing a confidentiality agreement. All the Zeckendorfs will say is that it was, in Will’s words, “by far the highest price ever paid to [relocate] a single tenant in the city of New York.” Another record, albeit one they wish they didn’t hold. It was $17 million, according to someone with knowledge of the transaction. Rozenholc also forced them to pay for shelves in the new apartment to hold Sukenik’s scientific journals. In return, Sukenik promised to pay the Zeckendorfs $1 a month in rent. “As a joke,” Rozenholc, who got a third of the settlement, says he gave them a check for $120 for the first ten years and added a clause to the final agreement requiring them to return a prorated amount if Sukenik died in that time.

  The first wrecking ball hit the walls of the Mayflower two days after Michael Grabow delivered Sukenik’s check. “He walked out with Rozenholc’s assistant carrying his belongings in a battered suitcase,” says Grabow. He lived on as a shut-in in his new home right around the corner until his death at age eighty in January 2011. Despite his wishes, Sukenik’s $9.8 million estate apparently went to his brother. When the Zeckendorfs recovered and sold Sukenik’s condo, they made a profit of $362,500 before closing costs.