Hotel Franchise King Spends $12.1 Million Entering Southampton

HENRY SILVERMAN SET TO MOVE IN AMONG LEON BLACK, LINDA WACHNER If the folks who own summer homes on Meadow Lane in Southampton were in the habit of organizing welcome wagons, Henry Silverman, chief executive of Cendant Corporation, the world’s biggest hotel franchiser, would be a very pampered new home owner. In March, Mr. Silverman, 60, and his wife Nancy paid $12.1 million for a 10-room house on the same street as Leon Black, chief executive of Apollo Advisors; Linda Wachner, chief executive of the Warnaco Group Inc.; Andy Stone, the former head of Credit Suisse First Boston’s real estate group, who bought his $10 million house in 1999; and real estate developer Francesco Galesi, who’s trying to sell his place, called Elysium Castle, for $45 million.

Then again, the Silvermans are already familiar faces in the neighborhood, having lived in their new 6,500-square-foot house last summer as renters. The seven-bedroom house, south of Meadow Lane, sits on three acres and has 200 feet of ocean frontage. There are eight and a half bathrooms, a media room and two fireplaces; the master suite, with a white-marble Jacuzzi bathtub, has views of the ocean. Out back, there’s a pool, a hot tub, tennis courts and a three-car garage.

Near the end of their lease, the Silvermans made a bid to buy the house for about $12 million from the owner, Ronald Stuart, former chief executive of Daiwa Securities America Inc., according to John Golden of Sotheby’s International Realty. In response, Mr. Stuart put the house on the market for $13.5 million through Pat Petrillo of Sotheby’s last August. Listing the house resulted in “some competitive interest,” said Mr. Golden, but “it wasn’t on the market for very long. They grabbed it up almost immediately.” Mr. Golden said the Silvermans signed a contract to buy the house for $12.1 million last fall. Mr. Silverman didn’t return calls to his office.

The deal did not become final until March because “no one was in a rush,” Mr. Golden said. “When you buy a house on the ocean, which this is, it takes a long time to do whatever you want in terms of zoning.”

The Silvermans have hired Robert Barnes of Barnes Coy Architects, a firm based in Bridgehampton, to renovate the ultra-modern-looking house. They’re making it more traditional,” said Mr. Golden. “They’re changing the façade and the interior.” Specifically, they’ll scrap the red billiards room, said Mr. Golden, who added that most of the renovations wouldn’t be completed by this summer.

Mr. Silverman, a member of the University of Pennsylvania’s board of trustees (he graduated from the law school in 1964) certainly has the credentials to live on Meadow Lane. He started out in New York as the assistant to the late Warner Brothers chairman, Steve Ross. He hit Wall Street’s radar screen in the 80’s when, as financier Saul Steinberg’s right-hand man at Reliance Group Holdings Inc., he gobbled up the Days Inn of America hotel chain in a $600 million leveraged buyout. He also worked with Pete Peterson and Stephen Schwarzman at the investment banking firm Blackstone Group. In 1997, Mr. Silverman’s franchising company, HFS Inc., which owned the brands Century 21, Avis car rental, Ramada and Howard Johnsons, merged with direct-marketing outfit CUC International Inc., a company that sold memberships in discount-buying clubs like Shoppers Advantage and Travelers Advantage, to form Cendant Corp. Last year, Cendant, which owns more than 6,000 hotels, was on Fortune’s list of the 500 wealthiest companies (ranked 367th), with $3.93 billion in sales in 1999.

But if the Silvermans aren’t up for power mingling–it’s not clear who paid $6.8 million a few months ago for the neighboring house of socialite Amalia Lacroze de Fortabat–the property has a large private beach.


C.E.O. OF STARMEDIA(THE SPANISH YAHOO) DUMPS $10.9 MILLION GLASS HOUSE Fernando Espuelas, the 34-year-old chief executive of StarMedia Network Inc., a Spanish- and Portuguese-language Internet-access company, seems to be backpedaling out of Tribeca. Last September, StarMedia tried to sublet one-third of its “world headquarters” office, located at 1 Hudson Street. And last month, the Internet mogul decided to sell the 9,300-square-foot apartment he owns at 60 Warren Street for $10.95 million.

Mr. Espuelas paid $6.1 million last year for the four-story apartment, a tiered modern house on top of a 140-year-old former munitions and champagne warehouse on the corner of West Broadway. The addition was part of the building’s conversion to condominiums over the past two years. Mr. Espuelas’ aerie has walls of windows, three terraces, a private roof deck and, according to Regina B. Martins, the broker who’s selling the apartment, multiple plumbing stacks that allow for a flexible floor plan and numerous fireplaces.

Mr. Espuelas would not comment on the apartment, but a spokeswoman for StarMedia said “the apartment was Mr. Espuelas’ personal investment and has nothing to do with the company.” Ms. Martins confirmed this, though The Tribeca Tribune reported that she told them Mr. Espuelas “may have ‘toyed with’ the idea of living there.”

In January of 2000, Mr. Espuelas’ company signed a contract to lease three floors–a total of 210,072 square feet–at 1 Hudson Square, on the corner of Canal Street. Peter Morales, then vice president of finance for StarMedia, told reporters at the time that he particularly liked the “wide-open, Internet loft-space look” of the offices. But it may have been too much space. At the time the lease was signed, the company was already starting to slow down. Even though StarMedia was the No. 1 Internet service provider in Latin America, its stock started to plummet from a high of $70 per share in July of 1999 to about $20 a year later. Last September, the company laid off 125 “duplicate, nonessential positions,” or 15 percent of its staff, and the stock fell even further. (StarMedia is currently trading at less than $2 a share.) A few weeks later, Crain’s New York Business reported that StarMedia was offering 60,000 square feet of its 1 Hudson Square headquarters as a sublet and was in talks with its landlord, Trinity Real Estate, about an early lease termination.

In both his Tribeca ventures, Mr. Espuelas was thinking especially big. When he signed the 12-year lease at 1 Hudson Street, there was room in the contract for his company to expand its premises by approximately 140,000 square feet. And his four-story apartment was originally envisioned by the developers as two separate apartments: a 6,000-square-foot triplex and a 3,300-square-foot single-floor apartment. Ms. Martins said Mr. Espuelas decided to combine them.

This time around, the apartment may be sold as two separate spaces, the triplex for $7.5 million and the floor-through for $3.5 million. Broker Chris Leavitt of the Corcoran Group, who works in Tribeca, thinks the two-apartment configuration is Mr. Espuelas’ best bet for selling the place. “The buyer pool for $11 million is so small,” he said. And Mr. Espuelas isn’t the only Internet guy having second thoughts.


1725 York Avenue

Three-bed, 2 1/2-bath, 1,800-square-foot co-op.

Asking: $950,000; selling: $940,000

Charges: $2,036; 48 percent tax deductible.

Time on the market: three months.

BROKER KNOWS BEST When George Nicholson and Michele Kleier of Gumley Haft Kleier started marketing this six-room apartment with 28th-floor river and city views, eastern, western and southern exposures and a small terrace, they thought they were reaching a bit by asking for $950,000. But their price was second-guessed by representatives from the estate selling the apartment. The reps consulted an out-of-town appraiser and told the two brokers to raise the asking price to $1.05 million. “We knew this was wrong,” said Mr. Nicholson. “The apartment above closed at only $875,000 only a few months previously. Needless to say, savvy buyers who were lined up and ready for a bidding war walked when we raised the price.” Enter Manhattan-based appraiser Donald Miller, of Miller Samuel, who appraised the apartment at slightly less than the original $950,000. The estate folks dropped it. “Within two weeks, we had multiple offers again,” said Mr. Nicholson, “and the property sold for $940,000–a record for the building and, at this point, a less-strong market.”


16 Sutton Place

Asking: $1.55 million. Selling: $1.375 million.

Three-bed, 2 1/2-bath, 2,200-square-foot co-op.

Maintenance: $2,404; 48 percent tax deductible.

Time on the market: seven weeks.

RENOVATE AND RUN The guy who sold this apartment isn’t a developer, but he might as well have been. Back in February 2000, he began supervising a complete renovation after buying this place. For eight months, he lived in another apartment in Manhattan while workers were busy putting in new maple floors, creating a laundry area out of a maid’s room and adding a butler’s pantry with a wine storage area to the kitchen. Then, last September, around the time the work on his apartment was finally scheduled to end, the renovator got a job in California. A couple from Westchester who were sending their youngest child off to college bought the place, which had been redone in a style broker Joyce Glowe of Prudential M.L.B. Kaye called “contemporary.” Said Ms. Glowe: “Everything was state-of-the-art, because he was doing it for himself. That’s why the renovation was so fine.”


159 Madison Avenue

Two-bed, two-bath, 1,180-square-foot co-op.

Asking: $435,000. Selling: $415,000.

Charges: $1,017; 55 percent tax deductible.

Time on the market: six weeks.

BABY STEPS TOWARD MATRIMONY Consider the purchase of this apartment a pre-premarital thing. “The buyer wants to get married soon, and he is looking ahead,” said his broker, Gloria Weber of the Corcoran Group. Not that her client, a consultant in his early 30’s, has popped the question yet. “He’s always with a girl, but he didn’t quite say ‘fiancée,’ he said ‘girlfriend,'” said Ms. Weber. So maybe he decided to first get a place and then get the ring. Hopefully, he won’t wait until the apartment is completely renovated to get on one knee. Ms. Weber described the two-bedroom apartment as in “good original condition,” which translates as “needs lots of work.” And, said the broker, “he plans to do the renovations gradually.”


35 Bethune Street

One-bed, two-bath, 1,200-square-foot condo.

Asking: $875,000. Selling: $875,000.

Charges: $439. Taxes: $2,988.

Time on the market: two weeks.

ANTIQUES ANNEX For several years, this prewar apartment between Greenwich and Washington streets has served as a showcase for an English couple who have two antiques stores in the West Village. With its high beamed ceilings, moldings, French doors, terrace and fireplace, the apartment was the perfect backdrop for the couple’s finds. Then the inevitable happened: They ran out of space. They bought a new apartment at the Hohner Building, a new loft development in Soho on Broadway near Grand Street. Their new apartment (which set them back almost $2 million) has three bedrooms, 13-foot ceilings and large windows. In order to ensure that their antiques would feel at home, the couple asked the sponsor to build pilasters around the fireplace and moldings on the walls. “The loft will look like the old apartment,” said their broker, Robin Bowden of Douglas Elliman. They sold this place to a young woman who works as an investment banker. Ms. Bowden said the buyer loved the tasteful way the place was decorated and wound up buying a lot of furniture from the sellers. Hotel Franchise King Spends $12.1 Million Entering Southampton