To be born a Zeckendorf is to try to avoid the fate of your father.
It all started with William Zeckendorf Sr., the real-estate mogul’s real-estate mogul, whose greatest fault lay in being years ahead of his time. He assembled the parcel on which the United Nations rose in 1947 and also built the Roosevelt Field shopping center on Long Island, the Century City complex in Los Angeles, and several urban-renewal projects in Philadelphia and Washington, D.C.
Then he went broke.
His son, William Jr., vowed to take fewer risks, and so he did, for a while—but then he too fell upon difficult times.
His sons, Arthur, 47, and William Lie, 48, have just put up the premier new residential building in Manhattan at 15 Central Park West: 35 elegant stories of limestone, plus a swimming pool, screening room and restaurant. The pair has grossed more than $1.6 billion in sales so far, including the highest price ever paid for a condominium in New York City: $45 million, for a duplex penthouse.
“Sales will reach $2 billion on a $1 billion cost,” Arthur Zeckendorf told The Observer. “Our strategy was to focus on the high end, because that is where we saw strength in the market today. If we saw strength in the West 30’s and the West 40’s, we would go there.”
The Zeckendorfs made a very expensive but tightly controlled bet on 15 Central Park West. They spent $400 million to buy into one of the city’s best neighborhoods and then built condominiums, which, once sold, would quickly let them pay off the loans—and then some.
The main challenge was selling those condos, and that they did handsomely: Four-fifths of the 200-odd units in 15 Central Park West have been sold.
Before 15 Central Park West went up, Arthur did two studies: one concerning the features that made the great New York City apartment buildings great (courtyards, for example), and another about the best kind of limestone to use. The answer: Indiana limestone. And so the Zeckendorfs clad their building in stone from the same quarry that supplied the Empire State Building.
“They are calmly rational,” said M. Myers Mermel, a real-estate investor and consultant who has done business with the Zeckendorfs. “They just go quietly about the things that they are doing and seem to be able to accommodate the changes as they happen.”
Contrast that manner with William Sr., whose company, Webb & Knapp, built $3 billion worth of commercial projects in the space of 20 years, and who cultivated an image as a dealmaker and tycoon. “He was a tall man who always wore a Homburg,” said Kent Barwick, the president of the Municipal Art Society, who was working as a copywriter in the same building that the senior Zeckendorf had his company in about four decades ago. “He had this two-story glassed-in lounge on the roof where he would take all manner of people: I.M. Pei, Jackie Onassis.”
“Big Bill” Zeckendorf liked transformative projects that forever altered the land around them. His most celebrated transaction was taking an option on 17 acres of slaughterhouses along the East River knowing that they must be valuable, even though he didn’t know why.
As his option came due and he faced losing his deposit, he saw a newspaper headline proclaiming that the city was about to lose the United Nations because it couldn’t find a place for the organization’s headquarters. Zeckendorf called Mayor William O’Dwyer, who got the Rockefeller family to buy the land for $8.5 million and then donate it to the U.N.
In 1965, Zeckendorf found himself unable to make the mortgage payments on an overextended empire and went bankrupt. It didn’t take long for him to start a new venture, however. He found a few partners and, as his first deal, convinced a publishing house to extend its lease. The publisher was game, but wanted Zeckendorf to write his memoirs in return. So he did.
His son, Bill Jr., worked for his father at the comeback firm, which he eventually took over. Bill Jr. is known for his unassuming character, and he had early success by reviving undervalued properties like the Delmonico and the Barbizon. Then he made a much bigger gamble as part of the Union Square redevelopment, building a massive condo complex at the southeast corner of the park and naming it Zeckendorf Towers, after his father. (Well, after himself, too.)
In the late 1980’s, he did World Wide Plaza, the full-block residential-office complex between 49th and 50th streets, on the west side of Eighth Avenue. To entice commercial tenants to that edge of midtown, the Zeckendorfs offered equity in the building, because giving away part of the building was better than paying the interest rates that a bank would demand if the project were built before any occupants had signed leases. Neither project fared well in the 1990’s slump, and Bill Jr. lost majority control of both. He retired in 1992 and, now 77, lives in Santa Fe, N.M., in a development owned by his second wife, a former ballerina. (His first wife was Guri Lie, the daughter of former U.N. Secretary General Trygve Lie.)
Arthur Zeckendorf says that he and his brother didn’t cultivate their current approach to the family business in order to avoid the risks that plagued their father and grandfather.
“I would say they have both been very successful developers,” he told The Observer. “I would say our approach has been a combination of both: really trying to do major projects like my grandfather did and also my father, but to do them one at a time and to make it very successful.”
From an early age, the Zeckendorf brothers were exposed to their grandfather’s business and were quickly enchanted. After college, the two began working for their father, reporting to work at 7 a.m. and sometimes staying until midnight. In 1995, they bought part of Terra Holdings, a company that includes the Brown Harris Stevens and Halstead Property brokerages. Since then, they have turned their last name into a luxury brand, first with 515 Park Avenue and now with 15 Central Park West.