The latest front in the Hip-Hop Wars may lack the drama of a downtown studio shoot-out, but for the real-estate-obsessed, the recent tortured sale of advertising executive Peter Arnell’s Tribeca penthouse to hip-hop mogul Shawn Carter (alias Jay-Z) has been the biggest story since the fracas over the sale of murdered millionaire Ted Ammon’s assets on the Upper East Side. And some Tribeca residents couldn’t resist putting themselves in the line of fire.
The two-year-long deal concluded on Sept. 29, when Jay-Z closed on the seventh-floor penthouse in a converted 1929 brick warehouse building on Hudson Street, between Desbrosses and Vestry streets, for $6.85 million, city transfer records show.
The raw-space apartment covers some 8,000 square feet with 3,000 square feet of outdoor terraces, and was listed as being bought by a corporate entity known confusingly as Brooklyn Projects L.L.C.; Jay-Z signed the deed under his legal name, Shawn Carter. Mr. Arnell’s wife Sara was listed as the prior owner on the transfer records.
Jay-Z’s deal for Mr. Arnell’s penthouse capped a well-publicized apartment hunt by the 34-year-old “retired” rap artist that, according to sources, included scouting a coterie of the city’s prized downtown properties, including Israeli investor Jonathan Leitersdorf’s 8,000-square-foot triplex at 704 Broadway, listed at $19.99 million, and Robert De Niro’s 4,600-square-foot Hudson Street triplex, listing for $15 million. Jay-Z settled on Mr. Arnell’s penthouse after the advertising executive purchased Tommy Mottola’s bucolic Katonah estate for a reported $17.5 million.
In August, when the deal went into contract, the New York Post reported that Jay-Z’s business partner, Damon Dash, had been in line to purchase the apartment before Mr. Arnell unloaded the place to Jay-Z, in the process cutting Corcoran broker Wilbur Gonzalez out of a reported six-figure commission and sparking talk of legal action against Mr. Arnell.
Mr. Arnell-the chairman and chief executive of the Arnell Group, a New York–based advertising firm whose clients include DaimlerChrysler, Mars, Reebok International and DKNY-declined to comment on the proceedings, as did a spokesperson for Jay-Z.
Mr. Gonzalez also declined to comment.
Music-industry watchers viewed the real-estate shake-up over Mr. Arnell’s penthouse as yet more evidence of the unraveling partnership between the two Roc-a-Fella Records partners, along with Jay-Z’s reported plans to launch a cognac brand with Grey Goose to compete with Mr. Dash’s Armadale Vodka.
How do the neighbors feel about the competition coming to their exclusive downtown condo building? Two years ago, Jay-Z had come close to signing a deal on the apartment for $6.5 million, before tenants of the Hudson Street development-which itself made headlines in January after the condo board filed suit seeking $5 million from the developer to cover damages and claims of shoddy construction-reportedly derailed the sale, fearing Jay-Z would bring his celebrity lifestyle to the placid halls of their exclusive downtown address. The Arnells filed a lawsuit in May 2002 against two tenants they claimed interfered in the sale by posting notes in the lobby warning tenants of Jay-Z’s “criminal record and … lifestyle of knives, guns and violence.” The Arnells alleged that the tenants posted other messages in the lobby: “We are of the opinion that due to [Jay-Z's] lifestyle of violence, if he moves into our building, he will place us in danger,” another note allegedly read.
Famous celebrities have been turned away from buildings before (remember Madonna’s rejection by the board of the San Remo?), but not in condos-and not so far downtown.
In the chillier northern climes of the Upper East Side, real estate gets a lot more gangsta. Take financier and Revlon owner Ronald O. Perelman, who last month dispatched legions of lawyers and a private eye just to stop Philippe Delgrange from setting up more outdoor tables at his neighborhood eatery Le Bilboquet (you heard it first in our own Transom column!).
That was quickly resolved when the ensuing press coverage looked worse for Mr. Perelman than for the beleaguered restaurateur. But it wasn’t Mr. Perelman’s first flexing of legal muscle in the neighborhood: Two years ago, Mr. Perelman led a community campaign to block owner George Votis’ proposed 18-foot-high addition to the rear of his property at 41 East 62nd Street. Mr. Perelman got the Historic Districts Council, City Councilwoman Eva Moskowitz and Manhattan Borough President C. Virginia Fields on board to block Mr. Votis’ proposal to build a multi-purpose addition at the building for the Philharmonia Orchestra of London. (Mr. Votis served as treasurer for the orchestra’s United States fund-raising wing, the Philharmonia Foundation.) Just before Mr. Perelman could stage a sit-in with guitars and tambourines, attorneys for Mr. Perelman secured a temporary restraining order from the State Supreme Court on Sept. 20, 2002, barring Mr. Votis from beginning his proposed $900,000 project. Mr. Votis subsequently withdrew the application.
Guess what happened next? City records show that in October, in a $14.5 million deal, Mr. Perelman and his holding company, MacAndrews and Forbes, purchased the five-story commercially zoned townhouse themselves. According to a spokesperson, the company plans to renovate the unfinished townhouse into expanded offices: the townhouse sits adjacent to MacAndrews and Forbes’ headquarters at 35 East 62nd Street.
“[The property] has been sitting vacant, open and gutted for the past year. It was being renovated, then abandoned,” MacAndrews and Forbes spokeswoman Chris Taylor told The Observer. “Our intention is to finish the property as a commercial space for a small group of employees. It has been zoned for commercial usage since 1946, and we needed extra space. Our first goal is getting the building closed up because of the impending winter.”
Brrr! Ms. Taylor said that the initial plans don’t call for a combination of the two properties into one giant townhouse office. Peter Koffler, an attorney for Olma Realty (the corporate entity listed as the townhouse’s seller), declined to comment on the deal. Mr. Votis could not be reached for comment by press time.
If all this lawyering has you thinking that Manhattan real estate is finally a force of evil in the world, consider the fraternal love of fashion designer Anna Sui. City transfer records show that in May, Ms. Sui, the designer whose most recent collection was inspired by the 1970’s cult movies of Andy Warhol, purchased a fifth-floor loft at 130-134 East 12th Street for $1.4 million. According to the broker on the deal, Anne Marie Salmeri of the Corcoran Group, Ms. Sui’s brother, Bobby Sui, plans to reside in the 1,700-square-foot East Village loft, which sits between Third and Fourth avenues and was once a featured spread in Architectural Digest. Ms. Salmeri spoke to the apartment’s designer-attuned finish: “It was modern, and had a curved wall in the living room. All the closets and the dressing rooms had beautiful drawers. You didn’t need a dresser,” she said. Other details include the 12-foot ceilings and the granite surfaces and stainless-steel appliances in a windowed kitchen.
Reached by e-mail, Ms. Sui said only: “Actually, I don’t live at that address.” She declined a follow-up e-mail seeking further comment. Mr. Sui didn’t return calls seeking comment.
Recent Transactions in the Real Estate Market
350 Bleecker Street
Asking: $422,000. Selling: $422,000.
Maintenance: $588; 60 percent tax-deductible.
Time on the market: one day.
CUP OF SUGAR? The Web site Meettheneighbors.org was organized on the premise that Manhattan apartment-dwellers barely know the people living above, below and across the wall from them. But that’s not the case at this co-op on the corner of Bleecker and West 10th Street. “This building is a microcosm of the Village,” said Coldwell Banker Hunt Kennedy broker Armanda Squadrilli, who sold this 450-square-foot alcove studio in an all-cash deal to a twentysomething advertising professional. “They have roof parties in the summer. It’s a real community.” The young lady had been renting in east midtown before she ventured south of 14th Street. And she fell for this building’s tight-knit charm. “She knew that bidding on the first day is the way to get [the apartment],” Ms. Squadrilli added. Dina Cohen of Citi Habitats also partnered on the deal.
Two-bedroom, one-bathroom co-op.
Asking: $1.1 million. Selling: $1.05 million.
Maintenance: $1,368; 51 percent tax-deductible.
Time on the market: 60 days.
VAMOS A LONDON More Manhattan Transfers action in the Tribeca market: From this 12th-floor corner loft on the corner of Broadway and Warren Street, the owner, a Spanish photographer, took in open views of the Brooklyn Bridge and City Hall Park. Recently, however, the gentleman snapped up a Manhattan pied-à-terre and shuffled off to London after listing his two-bedroom, which has seven windows, hardwood floors and stainless-steel appliances in the kitchen. He found a thirtysomething couple trading up from Murray Hill’s post-college-co-ed-filled streets. “They wanted to be closer to Tribeca. They were coming from a place with limited views, and they really wanted openness and views,” said exclusive broker Shelly Ofterweil Russell, a senior vice president with the Corcoran Group. The couple now plans a renovation to the kitchen and bathroom. The building, abutting City Hall, was converted to lofts in 1980 and has a garden roof deck.
405 Greenwich Street
Two-bedroom, two-and-a-half-bathroom condo.
Asking: $1.85 million. Selling: $1.85 million.
Maintenance: $890. Taxes: $7,200.
Time on the market: two months.
HOT TIMES! It’s the rare case in Manhattan’s celebrity bubble when your real-estate broker may be more famous than you. But Douglas Elliman’s Mark Sebastian, who represented the entertainment executive who recently snapped up this Tribeca loft, had an illustrious career as a songwriter best known for penning the 1966 No. 1 hit “Summer in the City” for the Lovin’ Spoonful, the 1960’s pop-band most famous for the numbers “Do You Believe in Magic?”, “You Didn’t Have to Be So Nice” and “Daydream.” “I was a pop singer,” Mr. Sebastian said. A native of Greenwich Village, he wrote “Summer in the City” at the age of 14 while attending the Tuxedo Park School in Tuxedo Park, N.Y., and went on to be a songwriter for Earth, Wind and Fire, as well as to perform his own live gigs at downtown clubs like the Bitter End, the Village Gate and Gaslight, where Bob Dylan crooned early in his career. “Happily, I still do get those royalty checks,” Mr. Sebastian said of his No. 1 hit song. He also has a penchant for fine real estate, bringing his buyer from the Upper East Side to this 2,200-square-foot Tribeca loft on Greenwich Street, on the corner of Hubert Street. The full-floor apartment is accessed by a private stainless-steel elevator and has two bedrooms, windows on three sides, a custom remote Lutron lighting system, central air-conditioning; a wood-burning fireplace, a 70-bottle wine refrigerator and an in-house washer-dryer. “This apartment was about being in the neighborhood and enjoying the gifts of Tribeca,” Mr. Sebastian said. Jon Capobianco of the Corcoran Group represented the seller.