For a hedge fund manager known for his supreme self-assurance, Bill Ackman was uncharacteristically solicitous — almost humble — as he addressed the crowd.
The veteran of corporate raids and rancorous short selling campaigns was not speaking to a shareholder meeting or making a public case against an overvalued stock. Rather, he was trying to persuade a more disputatious crowd: the members of community board seven who live on Manhattan’s Upper West Side. Ackman desperately wanted them to support a Norman Foster-designed renovation of his penthouse on West 77th street.
“We love the site. We love the Upper West Side. And my wife and I wanted to raise our new family here. We have a two-and-a-half year-old child,” he explained at a virtual public meeting last week, sounding like any other dad with a primal need to build a nest.
This particular nest requires the demolition of the penthouse atop the 1927 building, which looks on to Central Park and stands beside the New York Historical Society. In its place, Foster would erect two modernist glass boxes, one stacked atop the other.
Depending on who you ask, it is either a sublime work of architectural genius or, as one resident observed: “[It] frankly looks like a flying saucer landed on the roof.”
The dispute, now entering a critical phase after two years of manoeuvrings, is another Manhattan real estate drama pitting the merely affluent against the hyper-rich and raises familiar questions about whether the city’s historic buildings should be preserved like fossils in amber or might be enhanced with thoughtful additions.
Ackman surprised some opponents last month by winning approval from the community board’s preservation subcommittee, with five members voting in favour and three abstaining. “We didn’t get our ducks in a row but Ackman very much had his ducks in a row,” said novelist Mary Breasted, who has lived in the building since 2008 with her husband, Ted. “It’s one of the most beautiful blocks in the city, we think.”
Breasted does not view Foster’s proposed penthouse as a spaceship so much as a “Malibu house on top of our building”.
She and other opponents fear that the renovation could open the way for garish copycats that would erode the character of a historic neighbourhood. They worry that New York may have lost its appetite to resist developers after being hammered by the pandemic, which has made the city fearful of losing more wealthy residents to low-tax Florida.
Last week’s community board meeting was but one hurdle for Ackman to clear. A taller test awaits on November 16 when the city’s powerful Landmarks Preservation Commission takes up the matter. If Ackman wins its blessing — hardly assured — the project would then go to the co-operative building’s secretive board for final approval.
The project has already stirred “an atmosphere of fear and distrust” among the residents of the 16-story building, according to a note circulated by concerned tenants. Some like Ackman’s plan, some hate it, and some wonder why he felt the need to buy a penthouse in a prewar building and turn it into a glass box when the city already features a surplus of off-the-rack glass boxes in the new super-tall towers at Billionaires Row.
Ackman, the founder of Pershing Square Capital, has notched investment wins that relied on big wagers, as well as his ability to persuade the market he was correct. Among them: a successful activist campaign at Canadian Pacific Railway and his bet against the Municipal Bond Insurance Association. He has also had big misses, including an ill-fated investment in Valeant, a drugmaker that imploded, and a years-long short selling campaign against Herbalife.
This is not his first time wading into the muck of New York City’s landmark politics. The Howard Hughes Corporation, which he chairs, bought a parking lot in the South Street Seaport’s historical district for $180m in 2018. Earlier this year, the company won the Landmarks Preservation Commission’s approval to put up a luxury building where other developers had failed. (A $50m gift to the neighbouring South Street Seaport Museum seems to have helped the cause.)
The penthouse is tiny by comparison but arouses no less emotion on the Upper West Side, where it is known as “the Nancy Friday apartment” for the writer on female sexuality who cobbled it together over the years from three separate units. It went on the market for $22.5m after her 2017 death.
Ackman bought it and set about building a dream home with his second wife, MIT scientist and architect Neri Oxman. A first design — with three glass boxes — was deemed too visible. Then came the scaled-down version.
The Ackmans believed they had the board’s support to overhaul the penthouse when they first applied to buy the property, and that their opponents are a cranky minority who fear any change. The penthouse, they note, is a former servants’ quarters that was tweaked by Friday over the years without any official approvals.
Their renovation was the marquee item on the agenda at last week’s Zoom-casted community board meeting, which also featured a lengthy discussion of rising crime and a warning that the homeless might soon take over the neighbourhood’s outdoor dining sheds.
Reverend K Karpen, the co-chair of the community board’s preservation subcommittee, attempted to ease the tensions over the glass box. “In case you were wondering whether the petitioners really do everything out in the open, the answer is ‘no’,” he said, noting that the Ackmans’ property included part of a third, concealed floor beneath the proposed glass quarters.
Then the debate began. It looked ominous for Ackman after Jonathan Weiner, a resident for two decades, said the proposal “crashes through” the building’s genteel norms, and that he believed a majority of residents “strongly” opposed it. A neighbour threw Ackman’s wealth back at him, complaining that his design used the beloved building as a mere “platform for a temple to a titan”. Roberta Brandes Gratz, an author of several books on urban development, snarled about Lord Foster’s arrogance.
But Paul Goldberger came to the rescue. He introduced himself thus: “I’m here as both a resident of 211 Central Park West and as the former architecture critic of both The New York Times and The New Yorker.” Those credentials border on royalty in a cultured enclave that revels in its bookishness.
“I’m in strong support of the design,” Goldberger announced, arguing that it was an inspired blending of old and new. “Though it’s small in scale, it holds the promise of being among this firm’s finest pieces of work.”
Eventually, Ackman, who has said he never practices a presentation, made his case. His blue dress shirt unbuttoned, he began by establishing his ties to the neighbourhood. He has lived on the Upper West Side since 1992. “For years, I looked at this building, this pink penthouse,” he recalled, with Gatsby-esque longing.
It was now crumbling, and nobody would take better care of it than he and his wife, he promised. That is why they had hired the finest architect and builder. He has also offered to pay for a new elevator.
“The reason why people in the building are objecting, in my view, is not because they’re concerned about architectural integrity. It’s because they’d rather that there’s no construction and no project happens on the roof,” Ackman said, adding: “We want to live peacefully with our neighbours. We don’t want them to be upset at us.” Asked about environmental impacts, he enthused about solar panels. “We also love birds!” he promised.
After a virtual show of hands at the end of the community meeting, Ackman’s dream appeared one step closer to reality: 25 members endorsed the renovation; only seven opposed it; and two abstained.
But his hopes for neighbourly bliss seemed more remote. “I think the guy is overplaying his hand, but that’s the way he always is,” said one resident, who has studied the hedge fund manager closely. “He’s nothing if not persistent.”
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