Trinity Church had a problem. The venerable Episcopal parish of lower Manhattan was possessed of the largest single real-estate portfolio in the neighborhood, and one of the largest in town, including some six million square feet of office space in the 27-block waterfront area west of Soho called Hudson Square. But vacancy rates were lagging, and new tenants were getting hard to draw. The streets around the imposing old office buildings were feeling barren and lifeless.
And so, in 2004, the church’s board appointed the Rev. Dr. James Cooper, a Florida pastor who had overseen his previous church’s entrée into real-estate development—and from there built the third-largest Episcopal congregation in the country.
Dr. Cooper knew just what to do. In his efforts to lure Carl Weisbrod to manage Trinity’s holdings, he threw in an extra title as well.
Mr. Weisbrod, an advisor to the city’s mayors for 30 years, would become the first-ever “president” of Trinity’s real-estate division. His predecessors had been mere “executive vice presidents.”
“He’s a shy guy and wasn’t that eager about it at the start, but that was my suggestion. I thought it would be helpful for all of us,” Dr. Cooper told The Observer. “We had already begun to look at making Trinity more market-driven in its approach to commercial real estate.”
So far, Mr. Weisbrod has performed as hoped for: In the past 15 months, Trinity’s laggard occupancy rate has swelled to 93 percent, well above the neighborhood’s average. New tenants have included Real Simple magazine, WNYC Radio, the Weinstein brothers and the Guggenheim Foundation. With the help of these small but noticeable leases lending him some cachet, Mr. Weisbrod is making the former printing district into the most expensive office market south of 34th Street—more expensive even than the financial district that he once championed.
But Mr. Weisbrod, 61, says that his mission is not to make money but to build a neighborhood (and in the process to make money), which is a skill he honed while head of the Downtown Alliance business-improvement district for 10 years, and before that in Times Square.
“We are part of the church, and our mission and the church’s mission is intertwined,” he told The Observer. “I am optimistic and confident that the church’s goals and its real-estate goals are pretty much in the same place: How does this neighborhood evolve to become as good as it can be? The specific elements of it remain to be seen. Most neighborhoods are vibrant and have a variety of uses and are quite exciting places to work, visit, to shop in and to recreate in—and, indeed, to worship in, too.”
Together, the two have displayed that enviable Episcopalian knack of doing well by doing good, which is made easier if you happen to own two dozen buildings in an up-and-coming Manhattan neighborhood. Still, that is but a fraction of the 215-acre farm that Trinity received as a gift from Queen Anne in 1705. The church gave most of it away, including one chunk that was used to found Columbia University.
Trinity Real Estate brings the parish, Dr. Cooper told The Observer, about $25 million a year in income. About $3 million is spent on grants here and abroad, he said, and another $4 million goes to diocese-wide activities, with the remainder going to maintain “two very old and very expensive buildings”—St. Paul’s Chapel on Fulton Street, as well as the namesake church near Wall Street—along with music and educational programs.
Trinity has always been a savvy landlord; Mr. Weisbrod’s entrance merely opens the latest chapter. In 1983, the church rebranded the industrial district west of Sixth Avenue as “Hudson Square.” That name used to refer to a park south of Canal, while the new nomenclature referred to the area to the north. Slowly, taking a lot of flak along the way, the church refused to renew leases held by printing companies, choosing instead to renovate the buildings and turn them into higher-priced office space.
The new tenants at first were advertising firms (Saatchi & Saatchi came to Hudson Street in 1987), then Internet start-ups and back-office corporate operations—but somewhere along the way, according to real-estate brokers, Hudson Square got too ambitious.
“When the whole market went up in 1999-2000, the pricing there went up too,” said Marc Shapses, a senior managing director at Studley, a tenant-side broker. “After the economy changed in 2001-2002, it took them a couple of years to bring their pricing where it needed to be to make deals. Maybe they were holding out for the right deal, but it wasn’t priced properly. Carl has been a lot more flexible.”
The area right now looks a bit like an Edward Hopper painting: elegant but desolate. The 12-story granite prewar edifices make the neighborhood appealing to the so-called “creative industries” of graphic arts, media and publishing, while its large floor plates give it an edge over the other leading creative neighborhood, the Flatiron. Last month, Trinity hired Cushman & Wakefield to broker its flagship building, 1 Hudson Square—the first time the church has relied on outside help.
Don’t expect that “flexibility” to last.
“The reality is, when you are a landlord, you do not have a tremendous amount of information outside of your portfolio,” Cushman executive director Andrew Peretz said. “When you hire a brokerage house, you begin to know what your competition is doing and what you need to do to win business. I think Trinity has been getting in the high 20’s and low 30’s. We are asking for $45 now.”
A rent of $45 per square foot per year would put Hudson Square above downtown’s average of $42.65 for Class A and above other parts of midtown south for the second quarter. Midtown Class A rates were $57.85.
However, leasing is just part of Mr. Weisbrod’s job. Trinity Real Estate lists four potential development sites on its Web site, including a 35-story, 1.3-million-square-foot tower between Spring and Vandam streets, the rendering for which shows a vaguely International Style prism set back behind a plaza on Varick Street. He said the design predates his appointment.
“It is really premature to be discussing what we might do,” he told The Observer.
Mr. Weisbrod served as president of the city’s Economic Development Corporation under Mayor Dinkins before going to the Downtown Alliance, and he is now one of Mayor Bloomberg’s appointees to the Lower Manhattan Development Corporation. He once described himself as a “lifelong Democrat” (who is not Episcopalian), but has been adept at working both sides of the aisle.
“Carl is very smart and very shrewd,” said Joe Rose, who was chairman of the City Planning Commission under Mayor Giuliani. “One of the best things he is known for is being someone with brains and integrity, and the ability to navigate at both the local and state levels to accomplish things people would have thought would be very difficult.”
Real-estate insiders say his government background may well end up compensating for his lack of private-sector development experience. He also may well end up forming a partnership with an experienced developer to build on the sites, or hiring seasoned executives. One of his first moves as Trinity president was to lure Jason Pizer back from Peter Malkin’s W&M Properties in Westchester. Mr. Pizer, Trinity’s leasing director, had left Trinity for Mr. Malkin’s company just months earlier, during the dead time between the departure of Joseph Palombi, the former executive vice president of Trinity, and Mr. Weisbrod’s appointment.
But compared to Soho, the sidewalks of Hudson Square lack people, shopping and restaurants. In fact, the entire ground floor of the flagship 1 Hudson Square has been empty since Trinity renovated the building in 2001. Home Depot has been in negotiations with Trinity for a site a few blocks away, although, five months after the deal was first reported to be in the works, no announcement has been made, and Mr. Weisbrod wouldn’t comment on the negotiations.
He would say, however, that Trinity is trying to craft the right mixture of retail tenants, however.
“We want ground-floor tenants that will add to the neighborhood,” he said. “We want to choose them very carefully.”