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

by Gross, Michael

  As the crowning touch, a simple formal garden, inspired by one on the rooftop of Rockefeller Center, was placed atop that penthouse for the sake of the residents of the tower above. It was “designed and engineered to support real plants,” says Whalen. It would get an automatic watering system and roof drains to lessen the potential impact on the penthouse.

  The tower, with its multiple uses, was a more complex jigsaw puzzle of floor plans. Directly over the retail stores Stern planned three floors (numbered six through eight) that would contain smallish apartments with views of either Broadway or the central courtyard; relatively spartan servants’ quarters that could double as home offices; and the building’s additional amenties: a twenty-seat modernist screening room designed by Theo Kalomirakis, the father of home theaters; a meeting center with two conference rooms; a billiards room; and a computer room. A north-facing terrace off those shared spaces (looking at the Century) would also be available to residents for events. The superintendent’s apartment shared the amenities floor. Above it, the core of the succeeding floors, where apartments would only have had views of the courtyard and the back of the house, were reserved for mechanical equipment.

  The ninth floor of the tower—actually the first floor of the physical tower—was designed to hold four corner apartments, all with terraces on the roof of the Broadway base; three of those terraces are enormous, larger than many entire Manhattan apartments. The two floors above that, both with high ceilings, are dedicated to more mechanicals, including the huge refrigeration plant and the hot-water heaters the massive building requires. For marketing purposes, there would be no unlucky thirteenth floor, and other physical floors would not be sequentially numbered, so floors eighteen, nineteen, twenty-one, and twenty-two in the tower would appear to not exist as well.

  As in the house, the next nine residential floors of the tower (floors ten to sixteen and twenty-three to twenty-five) were designed with six apartments per floor, including two one-bedroom units with obstructed park views over the top of the house. The three floor-throughs on the upper three of those floors would have open western views to the Hudson River. The better the views, the larger the apartment.

  The assumption was the tower apartments would sell to foreigners “who wanted helicopter views,” says Brown Harris Stevens broker Kathy Sloane. So the next thirteen floors, starting at the twenty-sixth, each contain two huge corner units on the north and south ends and two floor-throughs in the center. Again, the south apartments got an extra room because, in the Zeckendorfs’ eyes, their midtown and park views would make them more valuable.

  The thirty-ninth floor, with two apartments and two central terraces facing the park and another over Broadway, would shortly be redesigned as hedge funder Daniel Loeb’s floor-through simplex. The next floor up was also split into two penthouses, one served by each elevator core. As below, the southern-facing penthouse was slightly bigger. On the forty-first floor, the architects planned one huge penthouse with a three-sided terrace and a somewhat smaller unit with only a small terrace off its dining room. “But it’s just so perfect,” says Whalen, “and the height and shape of the living room are just amazing.”

  The forty-second floor penthouse, which boasts what Whalen calls “the incredible King of the World terrace” beneath the arches atop the building, isn’t the largest, but is arguably the best residence at 15CPW. “It’s only slightly smaller than the Weill apartment, but it has those arches you can see from an airplane, which to me is worth a lot,” Whalen continues, “and a living room that’s open on three sides and another incredible terrace facing the park. The master bedroom suite gets lovely, lovely views through Columbus Circle and down Broadway, one of the nicest in the building. It was a surprise view for us. We didn’t expect it to be so spectacular.” Other touches include a maid’s room and a kitchenette off the master bedroom, presumably for late-night snacking and grabbing a morning espresso before having to face that maid.

  Though substantially smaller than several of the other penthouses, the highest aerie at 15CPW was designed with a half-pentagon-shaped terrace with south, east, and western views, a second large terrace looking over the Hudson, and three French balconies on Central Park. And though its master suite only has a single bathroom, the architects planned adjoining his-and-hers dressing rooms, two secondary bedrooms, a study, a family room, a formal dining room, a library, a small bar, and a kitchen complex complete with a pantry and serving station.

  Stern’s office also designed the standard kitchen, master bathrooms, and secondary bathrooms that would come with each apartment (and boast requisite high-end brand names such as Dornbracht and Toto plumbing and Sub-Zero, Miele, and Wolf appliances), though it was always assumed that many buyers would rip them out and replace them. Despite that, in the final stages of the design, digital renderings showing how rooms might be furnished were created and walk-through prototypes of typical rooms were prepared for eventual use in sales. Just as they wanted to encourage families, the Zeckendorfs wanted to discourage purchasers from asking for customized apartments; only about a dozen would be sold as unfinished white boxes or, as the Zeckendorfs call them, “cold, dark shells,” to the earliest buyers only. “We have a very firm rule,” says Will. “We’re not going to change for you. We’ll delete. So if you want a bathroom with no marble in it, we won’t put the marble in it for you. Like restaurants: you can take it the way we deliver it, or you can delete, but there’s no in-between. ‘I want orange marble’? Do it yourself.”

  The architects’ enthusiasm for and pride in the project would shortly become one of the building’s unique selling propositions and help raise the prices for its apartments to previously unheard-of levels. But as enthusiastic as he was, Robert A. M. Stern would tacitly admit, when pressed, that while they’d improved upon the classic Gold Coast co-ops in many respects, in others, they couldn’t match them. Value engineering was not entirely anathema.

  In the prospectus for 740 Park, for instance, developer James T. Lee had boasted that even hidden components such as the brass pipes and concrete were the finest available. Asked if the Zeckendorfs could make the same claim, Stern said, while the building was still under construction, “I’m not going to comment on that. I would say that aspects of our building are comparable in terms of high ceilings, high-quality window frames, fine-quality glass in the windows, nice molding profiles. We’re building a reinforced-concrete building that meets every reasonably exacting standard. It’s wired properly and all of that. I’m not saying that someone touring the Wrightsman rooms [at the Metropolitan Museum of Art] will immediately feel that we’ve done just the same job; there’s a little more boiserie over at the Met.”

  The only part of the 15CPW plan that the public had a voice in was the Zeckendorfs’ desire to build a garage beneath the building, which was left out of the original descriptions because it required a special permit that had not yet been approved. The need to get that permit also caused the delay of an announcement of their architectural plans.

  “We held off as long as humanly possible,” Will Zeckendorf explains. “Then we had to start making presentations [to win approval of the garage]. I kid you not: We go to make the first one to [officials and neighbors, including the local city council member who had been vocal in opposition to the Time Warner Center]. We swear them to secrecy. This is in connection with our garage, but we present the whole building.” Within an hour of the meeting, David Dunlap of the Times called Stern and the developers. Someone had described every detail of the project to him.

  The Zeckendorfs had hoped to make a splashy announcement shortly thereafter, resulting in something like the front-page story in the Times about their smaller, less significant 515 Park. But Dunlap had readied another, longer story for the next day’s paper on the city’s latest redesign of Columbus Circle, which would soon be completed with a radical makeover of Huntington Hartford’s museum by its latest owner, the Museum of Arts and Design. That story was set to run on the front page o
f the local news section. So Dunlap’s editors rushed a brief—624 words—note about the new building into print, effectively burying their scoop on the seventh page of the same section.

  But the Zeckendorfs didn’t have time to dwell on the Times. It had been a year to the day since they had closed on the block. Demolition had begun in November 2004, but wasn’t completed until the following June; demolition of the northern hotel building didn’t begin until after Herb Sukenik finally took his leave in March 2005. Foundation work on the southern half of the site had already started by then. “The structure and composition of the rock outcroppings beneath the site slowed the foundation effort,” reported New York Construction, a trade publication for builders. “Moving from west to east on the parcel, the rock transitioned from medium soft to hard. The team used excavators and blasting to remove it.” The foundation for the tower was begun in the early days of January 2005. “On the Central Park side, the rock went to medium soft again but also dipped down so deep” that normal concrete footings were inadequate support, the construction magazine continued, so the rock was drilled and boxlike caissons inserted to support the building. Within nine months, the foundation work was complete.

  Aboveground, 15CPW is made of reinforced concrete—forty-three thousand cubic yards of it, reinforced with fifty-five hundred tons of steel. The house was topped off—its skeleton completed—in July 2006 and the tower that September. As that happened, the Canadian contractor, working with the architects, developed technical drawings of the 2,832 limestone panels it would take to cover the 290,000-square-foot façade (which represented a small fraction of the eighty thousand stone elements in the building, fifty thousand of those uniquely cut). Indiana Limestone had won the job because it had recently opened a new area of the quarry that, in 1929, provided the stone for the Empire State Building. It had stockpiled what is called “full color blend material,” stone that ran the gamut of available limestone color from buff to silverish gray. It also had the technical skills to cut it precisely to the dimensions required by Stern and Artex, the Canadian precaster, where pins were embedded in the stone with epoxy, and concrete was poured over each panel to form the backing. Only then were the panels shipped to New York.

  “With construction, we make it sound easy,” says Arthur Zeckendorf. Adds Will, “It’s never easy.” Even before the demolition began, the Zeckendorfs opened a construction office directly across the street at 1881 Broadway, one of Eyal Ofer’s two adjacent buildings there; it had a view straight over their new property. From that office they visited the site “every day,” Arthur continues, “meeting with the contractors, walking the building, watching the quality.” Sometimes contractors didn’t behave “and had to be disciplined,” Arthur continues wryly. “We had two supers, three hundred pounds each.”

  The most exciting moment for the Zeckendorfs was when the two kangaroo cranes—which had the capability to grow taller along with the building—went up on the site. But that thrill was brief-lived. One of the two brand-new cranes “was a lemon,” says Will, that “had a motor issue, so it would break down.” Then, the concrete crew had to share a crane with the stone installers, “and the concrete guy would literally toss the poor Canadians out of their crane and take it over for himself.” One day, things almost came to blows. “Ten Canadians versus two hundred big guys from Staten Island and Queens,” Will reports. “It wasn’t much of a fight.” Adds Arthur, “Over in one minute.”

  Finally, a third crane arrived, and once the house was topped off, all three worked on the tower, lessening the tension. In 153 days, work on the concrete skeleton was completed. By the end of 2006, the construction managers and contractors were able to shift their attention to the interiors.

  Nothing was taken for granted in the marketing of the apartments, either. The official Condominium Offering Plan, which had to be approved by New York State’s attorney general, offered a description of every apartment and a price for it. Though those prices could—and did—change, the initial numbers were of vital importance. The Zeckendorfs are loath to discuss the secret process known as inventory control, but the general idea was to price the units as high as possible, so there would be a bedrock of support beneath the investments that Goldman, Ofer, and their lenders had made, yet appropriately enough to attract immediate interest and buyers who would, if all went well, lure even more, allowing prices to steadily rise. As it turned out, they rose meteorically, to the surprise (and profit) of the Goldman guys.

  The initial pricing was done before the formal ground-raising, which took place after the foundation was laid and signified the start of aboveground construction. That meant the price of each unit had to be set by educated guesses off the plans, since no one could yet visit the physical space and see the views, which would have the most profound effect on value. It was off floor plans that the Zeckendorfs decided that A-line units would be the most valuable and the D-line slightly less so. (“A was labeled A for a reason,” says one of their salespeople.) The apartments in between were essentially railroad flats, long lines of rooms with windows at the two ends, but they would bask in the glow of the limestone and the bigger residences beside them, so they would be priced for rich people, too. Just slightly less rich people, or ones with several homes who cared more about a chic address in New York than a windowed kitchen.

  But how much could they charge? The Goldman team, Ofer, Kellner, and key members of the Zeckendorf Development staff were all given spreadsheets showing the two wings and all their apartments in the form of a grid that allowed them to value one in relation to the rest and fill in a price for each. The grids were prepared by the manager of the 15CPW project, Judith Kessler, who’d worked with real estate syndicates in the 1980s before joining Bill Zeckendorf Jr. as assistant project manager on Central Park Place.II

  “It was fun,” says a participant in the pricing process. “Where do different people see value? Where [at what floor] do you put price breaks? You’re guessing where the market will see value versus where we saw value. Who’s smarter? Do you make a hundred-thousand-dollar break here? A three-hundred-thousand-dollar break there?” Foreseeing the psychology of buyers and then controlling the release of the apartment inventory was key to maximizing the return on their considerable investment; they’d paid about $690 per buildable square foot for the land, then spent about $750 per square foot on their 886,000-square-foot two-tower behemoth.

  The developers planned to work their respective networks and ensure that several penthouses would sell immediately—to the right sort of people—but what then? “Some apartments are so valuable, you don’t want them to fly off,” the participant continues. “You want to identify those with the most value and [keep them off the market initially and] price them high and be left with the most valuable units.” The lower-priced, smaller units, on the other hand, were of less concern and could be sold off without as much thought. Balancing those considerations, however, particularly for the money-conscious Goldman Sachs executives, were the terms of the construction loan. The interest rate on that hefty debt dropped as the developers collected deposits on apartments in contract, creating a financial incentive to sell more apartments sooner. If selling is done carefully enough, early contracts cover the building’s costs and help drive down borrowing costs, while the prices of bigger and better units still in inventory keep rising, ensuring bigger profits, profits, profits.

  The proposed prices varied wildly. Will and Arthur’s numbers were the highest. Jerry Karr’s were slightly lower, and Justin Metz was the least optimistic. Once again, Goldman’s perspective, which valued quick returns over the highest possible profit, was obvious. “And we somehow merged them, averaged them, to create one pricing structure,” says Arthur, who compares the process to butchering and pricing cuts of beef.

  “There’s only so much good product,” he says, and it’s “based on the location in the building. The corners, the penthouses.” They also compared their numbers to asking prices at other nearby, comparab
le buildings. “You can’t completely divorce yourself from the realities of where you are,” says Will. Apartments facing Broadway would be worth less than those on the park.

  Wealth, whether large or relatively small, would define their buyer pool. The lowest price for a unit in the initial offering was only $1.78 million—but that was still well above the $1.479 million average price of a Manhattan condo in 2005. Only 24 of the 201 apartments would be offered for less than $3 million. But as Arthur points out, “Three million dollars is still a lot of money, double the average price of an apartment in Manhattan.”

  The middle class at 15CPW would occupy the fifty-one apartments priced between $3 million and $5 million. The bulk of the rest, sixty-seven in all, carried asking prices between $5 million and $9,999,999. The final fifty-two apartments were mostly priced between $10 million and $20 million. Those were the most desirable A-and D-line units, but also some of the view-enhanced B-and C-line apartments on high floors in the house, and the two forty-first-floor penthouses. The real trophies were the seven house duplexes, which ranged from $22 million to $30 million, the simplex penthouse above them, which would have a $41.25 million price tag, and the tower penthouses, all priced between $21 million and $26 million (for the one with that King of the World terrace).

  Ground-floor office suites, some with private street entrances, cost between $1.2 million and $2.184 million, and servants’ quarters were the real bargains, selling for between $650,000 and $1.74 million. But they could only be purchased along with an apartment, as was the case with the seventy-three $35,000 storage units and the thirty wine cellars; they ranged from $50,000 to $80,000.