Back in 1979, developer David Walentas was hanging around one of his earliest buildings—the Silk Building at Broadway and East Fourth Street, which he later converted into condominium lofts.
“I was talking to one of the kids, one of the flaky kids,” Mr. Walentas said—meaning the hipsters that hung around Silk before Britney Spears and Keith Richards showed up decades later.
“And I said, ‘Soho? Noho? What’s next?’” And some kid said, ‘Dumbo.’ And I said, ‘What the fuck is Dumbo?’”
That was most of New York’s reaction when young hipsters talked about the Brooklyn waterfront neighborhood between the Manhattan and Brooklyn bridges. The acronym, an acid takeoff on the increasing number of neighborhoods in Manhattan with abbreviated names like Tribeca and Noho, stands for Down Underneath Manhattan Bridge Overpass, which at one time must have sounded more like a place to dump a corpse than the next hipster-luxe address.
But Mr. Walentas, who has the words “NO GUTS, NO GLORY” embroidered into the left cuff of all his dress shirts, could see through the grime to the incredible potential of these tall, cast-iron buildings, set in a network of cobblestone streets with views of the waterfront, the bridges and the Manhattan skyline.
Local landlord Helmsley-Spear wanted $12 million for two million square feet of property in the little neighborhood.
But despite having a few deals under his belt, Mr. Walentas didn’t have the cash for that first deal. So he got the money from friends: the art-and-cosmetics mavens Ronald and Leonard Lauder. (As these things go, wife Jane Walentas had been an art director for Estée Lauder.)
Sixty-eight-year-old Mr. Walentas said his empire—which extends from Brooklyn to Manhattan to Dallas, Tex.—is now worth, “I don’t know, a billion and a half dollars.”
The pinnacle is Dumbo’s first triplex penthouse, which he’s building atop the 1915 Clock Tower at 1 Main Street. He’ll list the place for $25 million, which would easily make for the biggest single-family sale in Brooklyn. In the meantime, Dumbo commands the highest average apartment price in the borough—and the Walentases have it almost completely cornered.
David Walentas has a nail clipper on his keychain, and he absentmindedly grooms his nails as he tells the story of rising from poverty in Rochester to power in Brooklyn. “I lived on the farm—we had a pump in the kitchen, we had an outhouse, and we had a wooden stove. And I milked cows and shoveled shit and took a school bus, and my father was paralyzed when I was about 5 or 6. I’ve been working since I was about 7.”
He went to the University of Virginia on a Navy ROTC scholarship, though he avoided the military. He ended up in Copenhagen instead, and later Casablanca, where a Danish ship captain allowed him to work his way home. (Afterwards: “I went down to lower Broadway, sold a pint of blood for $10, filled up my Volkswagen and drove up to Rochester.”)
Then came his M.B.A. degree, and then more global wandering, until finally Mr. Walentas settled down and bought his first building—with the help of a Lauder-like partnership. “I always wanted to be a real-estate developer as a kid,” he said. “I used to play Monopoly.”
It’s perhaps an odd childhood interest, but he applied himself early to inculcating a passion for real-estate development in his son.
Jed, now 32, was schlepped to construction sites as an infant and given toy blocks, too. “I didn’t like to share the blocks in kindergarten,” he said. “I thought I was better at building with them than the other kids.”
By the time young Jed left the University of Pennsylvania, he had an offer from the Post to write about sports, and another offer from Donald Trump. He went to Mr. Trump’s organization in 1996 and stayed for a year, working on the conversion of 40 Wall Street. “I showed up three days after graduation, and there were 100 probably illegal South Americans in the lobby with sledgehammers, knocking all the marble off the walls. It was a war zone.”
Mr. Trump showed him a good time. “He took very good care of me—took me to parties, flew me around in planes and helicopters …. Before there was an Apprentice, I was an apprentice.”
As father and son tell it, a new era was dawning in Dumbo by 1997: Zoning changes allowed old warehouses to morph into luxury housing. “I called Jed and said, ‘We’re going to rezone the neighborhood, and I need you—and if you want to work for us, now’s the time. We’re going to convert 1 Main to condos.’”
So Jed joined his dad. Today, a corner of their conference room is occupied by Jed’s black Lab Phoebe, plus his man-sized stuffed teddy bear.
“It started out him working for me for a few years, and now I work for him,” the elder Mr. Walentas laughed. Among other things, Jed has headed the renovation of 110 Livingston Street, McKim, Mead & White’s old headquarters for the city’s problem-plagued Board of Education.
As the general contractor for the family firm Two Trees, he is also in charge of Dumbo’s newest condo at 70 Washington Street, plus the mixed-use Brooklyn Heights complex called Court House. Its 500,000 square feet have already sold out.
Thanks to those successes, Mr. Walentas bought up most of J.P. Morgan Chase International Plaza in Dallas. He says that he owns 1,000 apartment units in New York, and 1,000 more will spring up on his new Manhattan land at West 53rd and 11th Avenue. “We bought it for $130 million—a lot of fucking money,” Mr. Walentas said.
The family’s appetite for development, especially in Dumbo, is voracious. “Some people don’t want it to be a world asset,” Mr. Walentas said in his conference room. “It’s like people on the waterfront in the Hamptons, who don’t want anyone else to build there—”
“Or even come to the beach,” said Jed, who often finishes his father’s sentences.
Will he have his own sentence-finishing real-estate-industry son one day? “Couldn’t care less,” he said.
“We only had one kid, but we did good,” the elder Mr. Walentas said. “I can’t do anything about the next generation, but this one’s good.”