Indeed, Mr. Shvo, like Michael Douglas’ megalomaniacal character from the movie, seemed to thrive on the motto “Greed is good.” “The ideal buyer, as far as we’re concerned,” Mr. Shvo has said, “is somebody that will give us the highest dollar per square foot for a product in that location.”
Mr. Shvo also draws comparisons to Jay Gatsby, the enigmatic socialite from F. Scott Fitzgerald’s classic novel. He became that mysteriously wealthy man throwing ridiculously lavish parties at the trendiest addresses in Manhattan—a truly ostentatious lifestyle that belied Mr. Shvo’s rather humble roots.
The Israeli émigré, who arrived in New York with just $3,000 to his name, once managed a group of taxis as well as a Manhattan bar before making his nut in the real estate game. He would go on to nab the honor of running the top-grossing group at Prudential Douglas Elliman in 2003 before starting his own eponymous firm the following year (after a nasty and public split with his Elliman mentor, the legendary broker Dolly Lenz).
His Gatsby fairy tale even comes complete with its own tragic auto-accident drama: One January night in 2006, Stacia Banta, a young, ambitious saleswoman, who had signed up to work at Manhattan’s first-ever 24-hour residential sales office at 20 Pine The Collection, was struck by a motorcycle while crossing an intersection at Ninth Avenue and 14th Street. She survived; her unborn child did not.
Ten days after the accident, she returned to work on crutches, only to be told she was fired “because she would be unable to take prospective customers’ coats or get them coffee,” according to a lawsuit later filed in the State Supreme Court, which charged Shvo with breach of contract and human-rights violations. Lawyers for Mr. Shvo denied the allegations; they further denied that Ms. Banta was technically a Shvo employee. The case has since been settled out of court.
It’s perhaps the most extreme example of the cut-throat business climate that Mr. Shvo has fostered amid the intense hustle of Manhattan’s recent boom. “You’re expected to run full-steam ahead, 24 hours a day, and you have to be on your A-game every single minute,” said Kelly Kreth, who lasted all of one week as Mr. Shvo’s publicist—“my dream job,” she noted—before bailing out. “It’s just so many hours.”
Another former member of his workforce likened the turnover rate among Mr. Shvo’s personal assistants in particular to a running gag in the 90’s TV sitcom Murphy Brown, where secretaries rarely lasted a whole episode.
“Just because you’re a great publicist does not mean you’re a great businessperson,” one ex-employee told The Observer. “It does not mean you can manage a company. It does not imply that you understand business strategy. It does not mean you understand how to treat people well.”
There’s always room for more aspiring marketing masochists at Shvo. The company advertised at least 11 job openings simultaneously this past January. Mr. Shvo mostly attributes the high turnover rate to his international expansion, but added, “There are some people that just didn’t fit. When you grow at the pace that Shvo is growing, you’re always due to make some mistakes along the way in hiring people.”
It’s with this Darwinian attitude that Mr. Shvo now enters a brave new era, both personally and professionally. Engaged to be married to fashion designer Laura Poretzky, with a $3.75 million house in the Hamptons hamlet of
If he has any intention of slowing down, he’s not letting on. The New York market in which he thrives, that’s a different story.
In the fourth quarter of 2007 alone, condo sales declined by 27 percent from the prior quarter, according to Miller Samuel. Even in the high-end luxury sector, sales were down 28 percent over the same period. A February report in The Wall Street Journal noted that owners of two apartments in perhaps the most sought after building in the whole city, the Plaza Hotel, had to cut their asking prices by hundreds of thousands of dollars. And, in 2007, for the first time in four years, Wall Street’s year-end bonuses, which fuel so much of Manhattan’s higher-end retail and real estate, didn’t set records.
Mr. Shvo likes to think he is immune.
“What’s important to understand is that people with money still have a tremendous amount of money, and there’s still a lot of funds out there,” he said in February. “Where you’re seeing a lot of issues both in the retail industry and in the real estate market is both in the middle sector and the bottom sector of the market. And that’s the market that we really don’t handle, and it’s not a market that’s even on our radar. I think the Shvo products appeal to a very particular buyer; it’s a buyer who’s looking for a lifestyle, and they are looking to pay for a lifestyle.”
Consider the luxury sports car, to which Mr. Shvo often compares his apartments: “When one goes to buy a Ferrari, it doesn’t matter what the economy is. The Ferrari’s a limited product. Only a few people are privileged to own it. Those people are always willing to pay a lot of money for a Ferrari.”
His shiny new roadster of the moment is the forthcoming W New York-Downtown Hotel & Residences, a 58-story tower in the Financial District scheduled for completion around mid-2009. Units are priced as high as $2,000 per square foot, well above even Manhattan’s averages.