Interview With Dan Biederman: Masters in Business (Audio)

uh Beetoman Development Ventures. Dan is the guy who, at a very young age, was tapped to run the company that essentially turned around Bryant Park in New York and he literally created a brand new model of managing and developing and redeveloping public spaces in a way that is effective and cost efficient and doesn't cost the taxpayers anything.

It's really a fascinating story as to how this came about and Brian park begat all these other ventures and parks both around New York and around the country, and even internationally they've they've worked in Singapore and in Canada and elsewhere. I found it to be really a fascinating story. And of all the folks we've had on the show, if you take the ratio of how well known the person is to the impact they've had on on and the number of individuals they've impacted, I think Dan is

the lowest known factor to impact of of anybody. Six million people a year pastor Brian Park and it's just a jewel of New York. So, without any further ado, here is my conversation with Dan Bieterman. This is Masters in Business with Barry Ridholds on Bloomberg Radio. I know I say this every week. I have a special guest, but I really have a special guest who I'm gonna describe him as someone who probably impacts more people on a daily base is and is less known to the

general public than any other guest we've had. His name is Dan Bieterman, and he is the person, in addition to running Bieterman Redevelopment Ventures, is the person who has turned Bryant Park and other public spaces around from dangerous drug infested crime zones to really Brian Park is the

jewel of Manhattan. Dan Bieterman, Welcome to Bloomberg. So, I I don't want to spend too much time delving into your CV, but briefly, Magna cum Laudy at Princeton NBA with distinction from Harvard uh focusing at on both public and international affairs, and in your undergraduate work, it's the nineteen seventies and nineteen eighties, and I'm familiar with Brian Park because as a kid, my dad worked on Madison and thirty nine and I used to come in and

visit him, and I was always told, hey, stay away from the park. Same thing with me and my father, who worked in the Grace Building. So so so that's your first introduction to Brian Park. The Grace Building literally faces Brian Park. So from that introduction as a kid, we go to the nineties, seventies and eighties. The park is decrepit, it's filled with homeless, it's filled with drug dealers,

it's a disaster. You come along, what makes you say, I have an idea, let's incorporate unentity to clean this up. I was lucky and that it was a great first job in the field because I've always wanted to be between the public and private sectors. I wanted to do public sector work, but not on public sector terms. So this opportunity came from the Rockefellers, of all people out of nowhere, and the substance wasn't so difficult to come up with. The politics were miserable, but we uh got

it done. It took a decade longer than it should have, and now we've had twenty five years to watch the improvement. So let's let's back up. The Rockefeller Is obviously Rockefeller Center up the street, but that's a good ten blocks away or or not eight blocks away. What was their interest in Bryant Park other than it was a horrific

blight in in right in the middle of midtown. It was the library bear though most people didn't know the Rockefeller Is really viewed it as their institution, much like MoMA and other places the New York Public Library. They were huge sponsors, hugely involved, and Mrs Esther, on her way it was one of her key institutions, on her way into a meeting of the trustees, was accosted by some drug dealers. Mrs Esther, probably eighty two years old,

looked like Mrs Esther, and they offer her drugs. So clearly the message was old lady, get out of here. This is our territory. She was outraged and ran into David Rockefeller, first person she sees and immediately after being accosted in Bryant Park. Very lucky for me, she says, young man, he's probably seventy four at the time. We need to do something about this misery. The roughie ends outside They just insulted me. Let's fix this. Well, let me let me. So you're a young kid at this point,

how do you get tagged too? By the way, Dan, come over here, see this park. It's a mess. Fix it. The only reason I got introduced to the Rockefellers is Larry Cudlow decided to resign as treasurer of a nonprofit development corporation on West Street Street Development Corporation. They needed a replacement. The guy who ran that, Fred Pappard, knew me. He said, you can do this job. And by the way, side benefit is at every board meeting. Jackie Onassis is president.

You'll get to know where So I said, sounds good, No pay, I assume he said, yes, I was twenty five years old. He suggested me to the Rockefellers for Brian Park because they were looking for somebody who might be a candidate to somehow turn around this mess. So you're on the Fort Street Development Corps. How does that

morph into Bryant Park Corporation. When David Rockefeller, the world's most effective human being for the last hundred years, Oh yes, goes back to his office from the trustees meeting, says to the guy who round the Brothers fund, UM, we need to just hire somebody to fix this. We don't know what to do, but we can't have the library be surrounded by drug markets and killings and muggings and rapes. So there was a competition. I got the job, and

then UM had no secretary. Nobody was in an abandoned office building because I didn't want to spend the Rockefeller's money on rent. And UH came up with a plan and the plan was a ninety day labor, but the politics were six year labor. It was really brutal. What was the plan to turn the bark around? I was even though I was young. I said, you gotta have models for such a thing. So the best models I found were actually something tied to the Rockefellers. Rockefeller Center,

Disney and rousse Rouse had projects that were turning around cities. UH. Disney had done a fabulous job in their parks, and I think Celebration Florida was a beginning thought at the time. So I went to which which is the Disney residential town that was sort of built UM with the same thinking behind the Disneyland parks in terms of use of use and access in and every detail exquisite. It's really a wonderful thing. They never decided to go on in

the business. So I went to all three companies and said, I'd like you, here's a deal. You can run a park in New York City. We're going to take it away from the drug guys. You guys will be our agent. I represent the Rockefellers in the New York Public Library and the surrounding real estate owners. Let's get to it. And they all said, thank you very much. We have better things to do than fight with drug sellers in

New York City. But on the way out I got some useful information, which is I asked them how much did they think it would take to run a place like this? Well, they said, all of them, about a million dollars an acre. So we needed six million dollars. It's a six acre park. My chairman was Andrew High School of Time, Inc. And he said, how much is a city spending now? By the way, I said about a hundred thousand generously, and he said, okay, six million

to a hundred thousand dollar off set. And by the way, who's spending the money better Rock Center and Rouse and Disney or the City of New York, and I said, you know the answer to that. So he said, so sixty to one plus a multiplayer of two or three. So a D eighty two one is the difference and effort going into those eight properties versus Brian Park, a public property, And we were off trying to assemble a mess of budget to allow us to do all the great things we wanted to do for the public in

New York City. I'm Barry rich Helps. You're listening to Masters in Business on Bloomberg Radio. My guest today is Dan Biederman of BTV Ventures. Dan's firm is the company that essentially turned around Brian Park, as well as dozens of other parks around the country and elsewhere in the world. Will get to that in a little while, But what I want to talk about now is the political process of taking what is a public space that's fallen into

disrepair and has become dangerous and turning it into something else. Uh, you said, obviously it took you ninety days to prepare the plan and then six years to get the politics settled. Explain that, UM. Every everybody leaped in and said the idea of a privately managed space, UM and a program space was a bad idea. Many of them have never been in Brian Park. But the preservation movement jumped in

with both feet to oppose me. But were they thinking you're gonna throw up in an office building and Brian or just we're against it philosophically there was There was parks in New York at the time, and the Parts commissioner said a good thing. At one point he said, you know, they don't all have to be managed in the same cookie cutter way. Let's try and experiment in one of them. Later three, because I took over two

other parks in New York. But that contingent for the preservation world wanted them all to be random managed the same way, which was government in charge and government both spending and collecting methods, managing the profit and law statement, which is not a good recipe for success. So so you put together a nine day it took you ninety days to put together a plan. What were the key

points in that plan? We invented something called programming, which is an urban parks, you can't really afford Barry to let um segments of the park be isolated. Um, it's not your Semite National Park where you don't need to program it's it's there are. Despite the reduction in New York City's crime rate, which we were a key part of, there are a lot of idiots walking around who will do bad things, scare women out of the park and whatever.

So we invented programming. And if you walk into a park that either that one or the one we did in Dallas, the one we did in New York, you will see a lot of stuff going on that brings people into the park. And the more people were there, the safer it gets. The female ratios go up, which is a key indicator of park success. So we had that. We decided to do some food and beverage which had

never been in the park. Restaurants and kiosks, um an elaborate budget with multiple revenue sources that would allow us to really do an excellent job running this almost on the scale that Disney Rouse and Rock Center had suggested. And um then we've rolled that out across the country, but in New York it was hard. Blue state political processes are thick, to be kind, and my chairman at

the time said, somebody asked him about approvals. He said, everybody in the Western hemisphere and his brother has had to approve this twice, and that's why it took six years. It was a novel approach, so you would think that'd be a little skepticism from people saying, wait, you want who to take this over? But then that raises the question, how do you manage a park that size with a even in the nineteen eighties, with a hundred thousand dollar

budget that doesn't pay for sanitation. Even the answers weren't that hard to figure out, but the politics were brutal. In fact that there was a point at which I considered giving up after six years, and I met a very bright land use lawyer, Steve Leftwitz, on a train and I said I was discouraged. He said, why are you discourage? This is going to happen. I said, what makes you think it's going to have? And they're fighting

me at every turn. He said, there are four types of projects and they fit on a matrix neatly, something I've never gotten. I use it all the time. There are dumb projects and smart projects, good ideas, bad ideas, and then there are projects backed by powerful people and projects backed by powerless people. So he said, you can imagine how often bad ideas backed by powerless people happen. They almost never get adopted. He said, um, um, but

this is a good idea back by power. He said, this is a good idea powerful people, and good idea really good ideas powerless people. Bad ideas powerful people. So he said, this is a fabulous idea. Your plan is great. The Rockefellers are behind it, so are the real estate owners. This is going to happen. Don't get discouraged, stop winning and go back to work. So that I needed that pep talk after six years of facing the public cross

speaking of the real estate owners. The buildings adjacent to the park above and beyond the appreciation that the rest of the city has enjoyed has accumulated an additional two billion dollars in value just because of their proximity to the part. It was a real eye opener. The guys who owned the Grace building initially sold it to try Zekon, which then sold it to Brookfield. Um a very nice guy. He sat me down, He said, let me show you

how much money you made this family. He said, really, let's let's assume it's about a twenty buck premium for Brian Park. Being this's good, he said, I think that's modest. But every square foot of our million three square feet went up in value over five to ten year period by twenty dollars as a result of your efforts. And he said, the that goes straight to the bottom line.

It doesn't cost more to collect more rent. So he did the math for me twenty million dollars times one point three million twenty six million dollars and then he said the cap rate years. The cap rate at the time was five. So he said, okay, so twenty six divided by point oh five million dollars. He said, how much have we invested in this thing? I said, well, you guys gave a garden and you've been part of our business improvement districts, so I got a million bucks.

He said, so five twenty x, he said, can I tell you we've never had a five X experience? Did you happen for more money? To hey, you guys should be putting. I told the story my next salary negotiation to the other board members and I said, why are you fighting me on twenty k This is um. There really was a lot of value created. So I now tell the story to prospective clients in other cities who were thinking of fixing their lobbies or doing other things

that really aren't that remunerative for the ownership. But you take a public space and adjacent to the building and it's a home run for every that's a win win across the board. And right now in Dallas, we did a park, Clyde Warren Park, with the help of a bunch of Dallas billionaires. It's very successful and there's a real estate boom around it. It's a cap park over a formally open highway between that divided the city and

half right uptown Dallas to the Arts district. And it's huge and i MC generator both for the private owners and then the city benefits from this. The uh we did an assessment last year. Thirty three million dollars in real estate tax has added to the city at Brian

Park just for the thirty three adjacent properties. To say nothing with the guys who are blocked away, who are all arguing, you know, coming here because Brian Park is a block away, so it's a it's it's probably a nine figures the added real estate tax as a city's collecting as a result of Brian Park. You're listening to

masters in business on Bloomberg Radio. My special guest today is Dan Bieerman of Biederman Development Ventures, and his company is the firm that really helped turn Brian Park around and a number of other parks, both in New York and throughout the United States and actually elsewhere in the world. Let's talk a little bit about your company mission and what should be the proper role of government in these in these public spaces. So, but by somewhat serendipity, you

end up getting involved in Brian Park. A decade later, the park reopens, it's a huge success. It's literally a jewel in the midst of Manhattan. Everybody, everybody around it just loves it. I have lunch, they're pretty regularly, all the all the food vendors and all the stores adjacent to it. These guys just you know, they can't get people through the register fast. Um. You go in there on a on a bright spring day and it's wall

to wall people. It's just it's just beautiful. Barrier. I should and I start to interrupt the As a job creator, these projects are enormous. Briant Park had one and a half jobs when we took it over. Now, between the restaurants, among the restaurant's kiosks. The programming we do there, it's about a thousand jobs really, and the park we're doing a new work. We have the same aspirations for that to create employment in a city like Nework that really

needs so. So that leads me to my next question. So you finished Brian Park and it's a huge success. At that point, you're saying to yourself, gee, this is kind of a union space. It doesn't seem like anybody else is doing anything with this. How did you then say, Okay, we have this new model and we're going to take it.

We'll take it national, all right? Was lucky. I had another product in Manhattan which is taking over whole neighborhoods through what are known as business improvement Districts s I d s. I see them every on street corners, people sweeping up, you see them throughout Manhattan. So we were the first to do it on a large scale basis. And my firm BRV actually does create them and doctor them. It's a smaller product because uh, and it's a b r V is a not for profit, Is that right?

My My firm is a for profit company, which is the development profit Brian Park in thirty fourth Street or run is not for profits, but with private sector bias, we're only incidentally not for profits. So um uh. The there are numerous parks. The traditional way of fixing or creating parks is higher landscape architect come up with some ideas that are designed only, and then spend a lot of money and open it and I hope people show up. Um, you guys have a much more holistic approach. We start

with programming and define define programming. It's not just movies on Fridays, exactly right. You use it a very different way. The word well said. It's a combination of things that will make audiences arrived not only at peak times like lunch and after work, but also in between. So in Brian Park you can do about forty free things and the park we have in Dallas. In the park we're doing a new work. You can learn to knit, you can learn a language, you can listen to authors push

their book, you can listen to business talks. This is all spread throughout the park. That's what should drive the design and the turnaround, not spending a lot of money in a fancy architect. There are just too many cases where fancy l a's or landscape architects or architects have been paid to make a great space, and then the space opens and nobody comes. Programming is what drives people.

It begins with bringing the crowds there, and how everything looks is subordinate to that utility, to the functionality of the park. You could you don't want to do this, but you could theoretically have a busy park with relatively cruddy uh surfaces and the like. The public notices the activities more than they notice the appointments. But obviously we try to be exquisite in the physical way, also by paying attention to every detail, no letter, no graffiti, um

washing everything. Having exceptionally good public restrooms, which is a real thing. That's the nicest public restaurant. Ourselves on it, and it's hard to do. We learned a lot about restrooms that in my NBA class, I'm the only one who was a minor in restroom management. I think nobody's

what's interested in that. There's literally a book called where to Go, and it gives you a list of all the public whatever in New York and the Brian Park are the nicest bathrooms in this We try to be as good as the ones in the plaza and the st regis, and we kind of send people up there. They're they're literally bouquets of flowers in the restroom. It's not what you would expect from a public park restaurant. We had to convince women that we had a public

restroom they could trust. So the first thing you see when you go through the door is the bouquet of flowers. And we can see women saying, well, they're not going to do that if this is going to be a crummy place to go. So that's that's that's a That was a lot of psychology in development spaces, including including bathrooms. And in the last minute we have in this segment, let's talk just about uh, the idea of governance. How do you govern a park this size. It's good to

get a group together. If if it has to be nonprofits, so be it. But the group should have property owners who have a a real stake. UM. Some public officials can't be a majority of them, because otherwise you're off to the races with the way government's always operated. And then other people who are interested. Tenants are a good group to include, UM and UM solent to staff as well. As money. Yeah, that's right, and I you know, you know, it's not a dictatorship. I have to answer to a board.

But after thirty five years of doing this, they tend to concede that I know what I'm doing, so I get a lot of freedom to run the thing the way I want. I'm Barry Ritt Helps. You're listening to Masters in Business on Bloomberg Radio. My special guest today is Dan Biederman of Bietterman Development Ventures. They are the firm that helped turn around Brian Park and literally dozens

of other parks throughout the country. And before the break, we were talking about the proper role of government in these public spaces and and so let's get into that what should be the proper role of government the faults of government and running services besides parks, but parks is part of it is they tend to over uh spend and undercollect so the profit and law statement comes out as skew. They're for forcing them to assess people who are the taxpayers a lot more than they might otherwise

have to. Now, when we were talking about Brian Park in the beginning, you said they had a hundred thousand dollar budget in the nineteen eighties. That seems like nothing, that that was just neglect. But in the cases where government does something a new, they tend to make deals that are above market on the employees side, and then there are revenue sources that they could be collecting from that.

Because it's not a for profit company, nobody pays attention to the Most governments have a revenue source or two, mostly taxes and then some fines, but the private sector looks for every dollar it can in many different ways. So Brian Park has five different revenue sources. We collect from the restaurants and chios in the park over three million dollars a year in rent. We have sponsors of some of our more prominent activities like the skating rink

and winter. Bank of America has been fabulous sponsor for three years. Their new headquarters is right on the corner of the park opposite directly opposite forty and they've been ending America terrific. HSBC is a sponsor. Southwest Airlines has naming rights to a chios there um and so, and we've had events from well, I'll get to that later. The sponsorships a loan or about five million dollars the

events we have introducing products. Everybody from Starbucks to Microsoft to uh T Mobile has introduced products in Brian Park because of its prominence. Doesn't take much time and it's rare, but when they do it, we make them pay for it. That's another million and a half. And then there's a surrounding business improvement district we mentioned that's about a million and a half also, and then drives and dribs of other things. We do some merchandizing, not very successfully. Total

of about twelve million dollars in revenue. So that's how we got to that. Didn't a rock Center and uh A rouse number. So if this wasn't if this wasn't a U corporation running this, what would the city be spending on on Brian Park on its own? They probably by this point I figured it out a bit and have a bigger budget, but but not twelve million dollars and it would be heavy in um you talk about minimum wage changes, this with the employees or the porters

would be making thirty dollars an hour. That's not the market. So you're nice to your people and you're generous with them, but you can't pay them. You can't over pay, you can't pay. The pension deals are so unsustainable, and states like New Jersey and Illinois that those states are constantly threatened with bankruptcy. Truth, So you you can't do that

if you're a private operator of a public space. A little trivia about Illinois, they stopped paying out their lottery winners for a while because they literally didn't have the money. So not only is the whole thing a sucker bet that the odds are dramatically against you winning, but even if you win, you may not get paid because now you have counterparty risk, which is really quite amazing. So so let's talk about some of these other parks and

how the government there interact with the private sector. So in Dallas, you have the Clyde Warren Park, and that's sort of an unusual situation because you had a highway kind of dividing the city in half. How did the park change that kept the highway and we did a beautiful park with a ton of activity. And there's some

very wealthy people and public spirited people in Dallas. Jody grant um and and it was ahead with his wife, Sheila, and they made a major difference by making a deal with the mayor that the private sector would essentially finance the park and a little bit more if the state of Texas and the city financed the and a little federal help from uh uh federal funds. UH did the cap. So it was a good You say, the cap? What is? What is the cap? Essentially A it's it's currently being

thought of in many other cities. It's covering the highway so that the noise of an interstate does not ruin the adjacent neighborhoods in the city. Atlanta's considering it now l A. I don't think l A is going to get there because the costs are gonna be too eye. And the great thing about Texas is construction costs are incredibly reasonable. Why is that? Uh? An expensive labor from over the border of sense of unions has something to do it. This project, soup to nuts, including the park,

was a D three million dollars. I guarantee you in the Northeast that would have been half a billion and at least and wouldn't have happened either. But if it had happened, would have been happened. Speaking of the Northeast, before I want to ask you about well, let's go right to Canal Side in Buffalo. So this was a vacant space that was kind of just being ignored. What happened with that that space, Well, they've already started to be fair before we got there. It's a very good

and give government Gunner Cuomo some credit. It's a very good state agency Erie Canal Harvard Development Corporation, which run by smart people, and they they liked the idea of the programming and they've really energized the area, um with not so much money of the taxpayer as some of the other elements of Buffalo. Uh. And you know, I've got a public space with concerts and and food and beverage and skating rank that's really a credit to downtown Buffalo.

And uh there's development that's been generated around it, partly by the space, partly just by good Buffalo developers like Benderson and the owners of the Buffalo Sabers doing major things. So if you haven't been in Buffalo, awhile, it's worth looking at the real progress there. So two things I would be remiss if I didn't discuss. One is the high Line Park in Manhattan, which talk about real estate

prices only unbelievable that's all. Now you're what was your um, I've said when I was describing this conversation to people in advance, I've said, if you like the high Line, which is a huge hit amongst both New York City residents and tourists, I think that never would have happened if it wasn't for the Bryant Park. I don't know if I can take it for it, but I will

say I'm giving you a little bit thank you. Jamestown. Uh, the owner adjacent paid me a little bit of money to advise Rob Hammond, who's the U one of the founders of Friends of the high Line, and he listened to what we said. He was he was a good client. So I only had a minor role, but they did go for some of the stuff that we did in brand.

It's worked out really well. And Um there's a park that's I believe it's in the midst of of um construction that was a former subway station that's reopening the low Line. Yeah, but they're trying to model after the high Line, and it's kind of clever, but it is underground. It doesn't have the views that thought a little darker. Yes, I don't know much about it, but they did call

to ask some questions. It's nice to so outside of Manhattan, outside of New York, what are the areas have you guys been working in and and what other successes have you had in the United States or the the the ones we always point to that are really finished our Dallas, Pittsburgh and Newark. And Pittsburgh, what used to be a parking lot next to the Cathedral of Learning was one of our early parks. It's called Shenley Plaza. Terrific improvement in Pittsburgh's a great city to work in and there's

a lot of good stuff in new Work. We don't think of anything getting done when we think of New Wark, what what was that park? Thanks to Ray Chambers, who's UH buyout guy, who then devoted the rest of his career to fixing downtown Newark and Mayor Booker the UH and PROW which has been a key backer along with a few others potential and prudentials right there. They their

foundation has been deeply involved. We really took a part very similar in its role there to Brian Park and have turned it into a lively space after years of it being vacant. It's called Military Park. It's between the arena and the New Jersey Performing Arts Center. PROW just built a new headquarters type building on top of it,

right next to it. And there were some who said, and I always annoyed me, Well, Bryant Park can only be done where there are a lot of yuppies around and huge office buildings, and and and and it wouldn't it's not relevant to the minority community. Newark's a majority minority city. And uh, they have been excellent. The residents and office workers around there have been excellent patrons of the park. So it's it's a kind of weird thing to say minorities don't like parks and outdoor spaces. That's

a weird perspective. They're actually the Newark residents who are using it are actually better for us because they'll they'll spend a little more time there, are a little more patient. Um, they're a little less on their iPhones and um. It's it's been a wonderful thing to see the social fabric of the park change. We put a restaurants, tiny restaurant in that's Salzburger's pretty inexpensively and that was hard to arrange.

You're doing free WiFi, and all of these parks wif park is a hugely successful WiFi thing, and they're hard to set up. Everybody says they have WiFi, but half the time doesn't work very well. But the one of Newark really is working well, and we worked well with the government of Mayor Booker. Mayor Baraka has has continued. He's been great. He's visited the park three times to

read his poetry and play chess and the like. And Um, the WiFi system was specked by the city and we extended beyond the park and now you've got free WiFi in that vicinity. Really in new Work, we've been speaking with Dan Biederman of Beeteman Redevelopment Ventures discussing the public and private space. If you enjoy this conversation, be sure and stick around for a podcast extras where we keep

the digital tape rolling and continue chatting. Be sure and check out my daily column on Bloomberg View dot com or follow me on Twitter at rid Halts. I'm Barry rid Halts. So you've been listening to Masters in Business on Bloomberg Radio. Welcome to the podcast. Um, Dan, thank you so much for doing this. This has really been a fascinating Charlie makes fun of me every time I

say that, but this is fascinating stuff. And in the intro I said, you may be the person who is on a fractional basis least known to greatest impact to the public. I can't count how many people do you guys track through Brian Park in any given year? Six million different visits, not six million different individuals, but there are six million visits a year. It's it's the most crowded per acre public space in the world, in the whole world. I gotta think more people go through um

Central Park, but that's hundreds and hundreds of acre. Their visitor count I think is in the twenty four million range, ining like that, But but they're hundreds of times were six acres but there's no People always throw up possibilities. Trafalgar Square, I said, Trafugar Square is empty compared to us. There's really Yeah, well, they have big events, but there that's a one off, right, What about places in Shanghai or Hong Kong. You know, Shanghai doesn't have anything with

that kind of congestion. I've seen some great parks in Beijing, but they get crowded they send in the text, it's not it's not as crowded as Bryant Briant as jammed and we we like it that way. Do you UM, have you guys looked overseas? Have people reached out to you from other countries other places? You know? I haven't made a big thing of it. I've There are five countries where I've done some advising the UK, Singapore, Finland, UM,

Israel and Canada. Yeah, and UM, Singapore, so that's pretty far afield that they have something called the Urban Redevelopment Agency which is very successful and UM I've been on their advisory panel once or twice. And basically, though our work is in North America, I've done a fair amount of work in Toronto now and UM the same basic concept. They take your model and reproduced. Do you have any competitors?

Are there any other businesses doing what you do? It's interesting the competition is to do parts the traditional way with landscape architects and architects, and that's not us. UM. We have a really narrow niche. And UH, there are a couple of economic consulting firms that say they do what we do, but they've kind of been derivatives, but we're it's it's a very narrow niche, which is the disadvantage. But the great thing is that we created the field. You own the space. So we got a lot of

calls and we don't. We do some marketing, but not much. We mainly get incoming inquiries from people who have been visited our places. That that was my next question is is there enough work to keep a firm busy full time? How many employees are thirteen employees, nine full time, four part time? It's very small and uh, there's plenty of work. I'm as my wife predicted UM a long time ago. Your only problem is going to be staffing the work. They're gonna be lined up around the block when you open.

This took a while for that to happen. But it's busy. So what other Let's let's go over some other parks elsewhere where else have you Well? These are cities were in starting from the west, Honolulu, San Francisco, Oakland, Actu Really Now l A, Tempe, Arizona, Houston, Dallas, Green Bay, Detroit, Buffalo, Toronto, Atlanta, um Newark, Greensboro, North Carolina, Boston. So we've talked about

we've talked about these huge successes. What hasn't worked out? Um. Once in a while, a company, but more often a government wants you to answer the questions they ask you as a consult in a certain way. And I have to give my little speech which I was taught when I was at my first job after business school. American management systems really good, smart, gut bunch of guys no longer exists. They were sold, but they said, as a consultant,

you need to tell the client. Do you want me to tell you what you want to hear or you want me to tell you what you need to hear? The right answer. Um. Once in a while we get a client who wants us to give them the answer they wanted to hear when they brought us in, which is very often the wrong answer. And it's usually a government agency, but sometimes a private player. UM. And then the the other kind of client. That's the challenges. They are more interested in how much they pay than in

how much success they have. They only look at the expense side of the ledger with you. UM. So we've had a few of those, but I would say of the client experiences have been great, and I speak highly of all of them, and I hope they speak well of me. So when you set one of these up, how much of the funding is coming from outside government? From revenue you generate in the park, plus whatever initial seed funding comes from the surrounding good questionities, real estate companies, whatever.

We start from the desire to have it all private funding, all private funding. I didn't make a big fetish of that in the broadcast, But the the aim is not to be beholden to government practices because you don't have government money. Uh So Brent Park has not taken any

government money of editing level, uh since it was founded. Wait, so that the park is running for all these years, since it opened in nine and New York City taxpayers are not paying for that, not a penny they actually there was an initial kind of good by payment that ended in and since twenty years no no government money, and some clients can't afford that. But generally, meaning there's

not the density that'll cover that. I mean, not only they aren't the varieties of programming that would allow you to exclude government money. Um. I'm trying to think of an example where we're gonna have to take government money like I would think San Francisco has enough population coursing through a downtown space that that should be easy. But Temple Arizona maybe not the same volume of people, not

as not as concentrated um uh density. But we're talking to the Tempee people about a possible use of the techniques we use to build our capital plan, which is borrowing money um using the government's in New York City triple tax exempt capacity issue a bond in order to build issue bonds. We repay they they're not on the hook for penty of it, and so it's just an expensive source of capital. Yeah, we're the debt service and that's been fifty million dollars total over the over the run.

And that's how Grand Central and thirty fourth Street got built with that technique, rather than asking government for capital funds, which is always a very difficult and in eastern and West coast cities it's usually tied to some labor deal.

It's very expensive. So so let's talk a little bit about the thirty four Street Business Development company you have that goes from the Empire State Building fifth and thirty four little east of that actually to Macy's where you have what is that horrors Greeley Park or something really part to the south and Herald Square to the north, and all the way west past that to the edge of Hudson Yard's past Penn Station, the post office. That's

all an area run by a business improvement district. Not everything, but most of what you see there as a member of the public, the litter collection, the Capital plant, UH, security officers parks is run by our b I D. And that's funded privately as well, all private money. We don't accept any government money. Really that that's quite fascinating. UM.

Tell me about a challenge. What was a park that turned out to be successful that when you first came across it you had to scratch your head a little bit and say, here's what's going on here, uh Seattle. UM, that's hugely successful. In that case, we're not running it. We very often at that distance tell them what to do and then back off. And there was a very good group that Downtown Seattle Association that took our recommendations whole and UM running with it. It's usually successful. It's

called Occidental Park. It's a couple of blocks from the Stadia there UH in the neighborhood known as Pioneer Square. This was a truly violent space. It was drugs, a lot like Brian Park at the beginning, drugs and really bad guys hanging out and victimizing people. TOMPs of tech companies a couple of blocks away, none of them were using it. The employees weren't there. So we told them how to program and how to spend a little bit

of money without government on various things. The Seattle Parks Foundation in Downtown Seattle Association ran with it, and it's a real turnaround. I keep track of it long distance. We're done, and they were very grateful. John Schules is then now a new head of the Downtown Seattle Association. Why do I know that name? He's He's It came up through the ranks. But John said, this has been

a huge success, and we're really grateful. I'm sure they're spreading the word that this is a great approach, quite quite fascinating. So you mentioned Canada and Singapore. Most of it has been in the US. Do you find a difference between cities on the coasts and cities in the mainland in the United States. I come back to New York sometime to press that I'm back in a tough environment for my field. Um, it's easier in the middle

of the country. Yeah, the why is that? Are people nicer or is it just there everybody's kind of on the same page and you don't have the intrinsic interest groups fighting. It's two things, um um unions. UM. I think New York State is thirty union workforce, astonishing number, New Jersey, California. Really unions are in very good control of legislative processes. And there's unions have been on the

wayne nationally for a long time. What is it, less than five percent of workers are now and the number is tiny compared to what it was a century ago, a half a century ago. But um not um, but not immunist about those states so much so. UM. That is one difference. In the second is there really is a difference in terms of the belief in um capitalist system. I don't have to I started a speech once in Dallas about this is the reason our parks work. And part of my pitch was that, you know, the freaner

prise system is a good thing. And they were one of the guys on the board waved his arms at Dan, you don't have to make that speech. Here. We got this is Uh, that's the difference. Um. The uh terms of employment a real threat to our field. Um, it's not just me, it's the little organizations that are doing the same thing in parks and neighborhoods. Is this specifying of the terms of employment by government which is happening in states like New York, New Jersey and Washington and California.

But when you say specified terms of well, we now have in some of the cities in those states, UM minimum wages of fifteen dollars, um, UM specified amount of sick leave in New York City, UM, specified amount of maternity leave. A lot of these things I did voluntarily. But to legislate across every business in your environment and say all of you must do the following things, really, in my mind, goes too far, and for little efforts.

We try to do a lot with little. If you're a little company, it's whether you're a for profit or not for profit. It's really difficult to uh do this fifteen dollar So Seattle going up to fifteen dollars by what it's phased until I think the nineteen but there that is in the next three or four years. Yeah, it's gonna hurt their ability to do things like pick up paper in parts that they privately managed and they know that, but the mayor's behind it and they have

to be behind it. And I thought it was companies with fifty people or more. Am I confusing that with something else? That that was one of the criteria for New York. But I don't know if that's true in Seattle. But fifteen dollar minimum wage and some lower cost environments, Washington is not. It's not New York. It's a very different. So let's challenge. Let's let's talk a bit, because restaurants are such an important part of the revenue stream for these arks. We had Bobby flay on a few months

ago and he was apoplectic about the changes. He said, you can't run a restaurant profitably in New York City anymore. Given the changes that are gonna be phased in. There are people who live earned their living on tips. I can't pay them twelve dollars an hour. That's too much. It's gonna be a challenge. The restaurants in Central Park UM with UM obviously involvement of the city because they own the real estate, are gonna have a challenge because

the hotel trades council. UM dominates UM their workforces now and I don't know if those two will survive. They're great place. Has that been the issue with Tavern on the Green has been a part of an issue. The reason there weren't so many bids on the new Tavern deal was that the city imposed uh, the Hotel Trades Council on the deal. And but to be fair to the city, I think one of le Roy had welcomed them in when he owned Tavern on the Green previously,

So that's UM dicey operation. They think they only got two or three bids for what really should have been a great opportunity because there was a lot of catering postage a ton absolutely at one point in time that was also a beautiful restaurant and kind of fell into disused disrepair and it it's not what it was. I don't know what's going on with it now. I haven't They want to representative restaurant, but the volume isn't what it was because it was cut down. Warner had turned

it into a mega megal. It's uh. I think he had thirty five million dollars in revenue annually, a part of it from catering Uh, and now smaller. So we we talked about overseas um and we talked about the difference in in coasts. You know, when you look at at some of these other projects, what what stands out when someone first approaches you with, Hey, we have this park and it's kind of a mess and we want to clean it up. How do you go about starting

that process reviewing that? What's that? Like? The first thing we do is kind of intriguing market share calculation. Um. This comes from a conversation with Eli Broad, who's done wonderful things for downtown l A. But Eli was too optimistic, in my view about how many people would visit the public spaces on Grand Avenue after the Disney Concert Hall was built. So UM, I kept warning him, Eli, not as many people are going to visit just to see

the building as you think. And then I said, I need to have a systematized way of making that case to clients like Eli, who's a smart guy, and you know, didn't really believe me. So we created something called a visitor market share calculation. We go out depending on the walking distance of each city. Dallas has a terribly small walking distance. Nobody walks there. Uh, New York, Boston, Washington,

ter everybody walks. So we go at twelve hundred feet in those cities and two hundred or three hundred in Dallas, and then we look at the adjacent hotels, office buildings, residences, retail shops, museums, and we say, how many people plausibly could be in this public space? Uh, and what are we gonna have to do to get them there? Because our market share at Brian Park sounds small, but it's four percent basically of all the people in the surrounding

area or in Briant Park at lunchtime. And you say, what happened the other ninety six And the answer is their own vacation, they're on a business trip, they're in a conference, they're eating at their desk by the uptown. So we lose nineties six percent through no fault of ours, But four percent is that's a big number of massive But some clients think they're gonna get ten or so first time we do is disabuse them of that, say, Brian Park has been plugging away doing this for twenty

five years. You're not going to get higher than four percent. And then we say, okay, what's going to drag these people in. Is it knitting um seminars like we do in Brian Park? Is it juggling clinics? Is it concerts? Is it the reading sessions we have? Is that patonk is a ping pong? We have a putting green. All

those things. We put together a bunch of things on a map and show the client how we're gonna drag people into their space at hours they might not have expect to be there, including seasons where in the past Brian Park was empty in the winter. For right, it's jam Now between the rink and then around the holidays are all the all the kiosks selling all these different crafts and unique sort of products. It's jam packed when you go in there. So um, that's Those are our

starting points, and from then it's a budget. And then only last do we go to the architects and say, okay, now draw this up for us. We we saved the clients a lot of money by not having them, uh spend a lot of money on fancy plans, especially in blue states where the construction costs are so high. Dallas can afford to do a little bit of that. The park really cost about twenty three million, but could have

been but less. But the same effort in New York above the surface of the park would have been three times as much. I was gonna say five x. It's only three times. Uh, this is never been sure, but it would have been very expensive proposition quite quite fascinating. So so are some of the other challenges you face. You have to get the clients to be realistic. You're dealing with politicos, you're dealing with unions. What else is a challenge that people may not be aware of that

involves turning around what's in a great while? We come upon something where I say to the staff, you know this is pushing on a string to use that ran Well, it's it's it's a suburb where there's no particular reason, there's no density, and there's no reason people within a reasonable distance, we're not going to go there. Even if you produce something that's so spectacular that people should want to see it as a curiosity once in a while. That's a challenge. Other ones are we have there. There's

a park I won't name in Boston. We we have two projects in Boston, South Station and Finnal Hall. There's a park I'd like to do there, but the This is not the fault of the this mayor or the previous mayor. It's the fault of the butters who are thinking too small about it. It could be one of the great public spaces in the country, surrounded as it is by iconic structures, but it's one Another big problem

is just this small thinking I call it. It's just let's collect a little bit of money and turn on the fountains and have a concert once in a while, and doesn't get it done. It's not that the people are not smart, it's that they don't have um the frame of reference to think bigger. And that's a big problem for my firm. I'm in Chicago pretty regularly and I'm always impressed with how well done their public spaces are. Have you guys done anything in there? It was funny,

funny Mayor Dally. I'm very fond of him. Um the second Mayor Dally. He was in Brian Park taking notes one day and he's chief of staff called me and he said he has a question and I said, I'm coming right down. I want to meet him. He said, no, you please don't do that. He's on his way to investment bankers in ten minutes, but he is curious. I said, Okay, Drew, I'm gonna give you these answers, but only if I can visit him in Chicago. So I went out there,

had an incredible meeting with him. Ordale. It was a great park mayor, and you're right, the parks really have been well done. Um. He did it through a park district, not through B I d S, not through privatization. He didn't really believe in privatization because it's all it's all city. But unlike New York and other big cities, Chicago's mayor is essentially a benevolent dictator. Uh. And so we have a

a family there, and one day we were there. We were there every Thanksgiving for the past twenty five years, and we go to the museums, we go to Second City, we do everything. Every I come back ten pounds heavier every Thanksgiving. And it ain't the Turkey. But we're walking through a park and I'm like, wow, these are really beautiful iron uh fencing, not the usual chain link junk, but like cast iron or beautiful. And I'm like, when did this happen? Stay straight? They did a nice job.

And you know, I asked him during the meeting. He was very detailed, and I said, you know, you know a lot about this um. Of all the mayors, have you know the most and that had was generally known. And after I asked his chief of staff, where do you learn all that? Because most mayors don't know these details of visual stuff. And he said his father. Of course, I said, how did that happen? He said, he took

him out in a car on the weekend. Richie, look at that building that looks horrible, and I just told my guy, you needed to paint that side of it and take that that iron casing away. He said, he really his father. Surprisingly, that the old the old Mayor Dally Richard Daydalely, I guess it was, had a very good eye, but was known as a ward heeler and a tough meaty. He had another skill which was not

highly publicized outside of Chicago. Well, the sun apparently inherited that eye, because one day he issued a dictate, which is channeling fences down cast iron fences, replacing them. And you good luck finding a chain link fence on any of the major parks in Chicago. They're all now. If you go to parts in Manhattan, you'll see these gorgeous Gramercy Park and some which has always been a private park. But some of these other parks have these beautiful cast

iron fences. But it was, you know, dealers, somebody's choice. They basically issued an addict and ninety days later there were no more channeling fences in the park. I know I only have you for another ten or fifteen minutes, So let me jump right to my favorite questions where I asked these of all my guests before we do that. Are there any specific questions I missed that anything you want to bring up um that I may have not gotten to. Uh, I don't think so. Which questions do

you think of asking? Asking the last the last eight? So we did some of these so we know what you did before you started working in this space. Let let me ask you who who were some of your early mentors. Uh. There was a guy who's not well known in the business community, William H. White Jr. Who came up with a lot of the theories about movable chairs and the like that we've implemented in Brian Park.

Brilliant guy. He was a journalist. He's known more for the books he wrote, including The Organization Man, and he was closely linked. Unbeknownsted we can say it now that he passed away about fifteen years ago. The Rockefellers supported his work. They thought it was so important, gave him

an office and a secretary and consulting deals. Um. There was one point he took me down to Princeton and he said, little little known to the public, the Rockefellers don't give money to the school unless I say that the physical improvement is a good one. So I want to really show you something outside of East Pine Hall.

And he was. He was a tremendously important factor. And what we didn't Briant Park and then uh, the people who helped me get started with these entities other than the Rockefellers, Andrew High School, who was the chairman of time ach and agreed to be our chairman for many years. Michael Fuchs who succeeded him. Yep, Michael's a brilliant businessman and has been our chairman at Brian Park of the kind of celebrity entity for about twenty years. Um, and

learned a lot from him. So and if I go to Brian Park and I first time I ever sold Louis c K had to be ten years ago in the middle of the day at Brian Park. The comedy series and slaughtered the part. People were falling literally rolling around the grass. That was a great comedy series. The language was a problem. We couldn't get the comedians to work clean so eventually, but it was hilarious, but I thought of bringing it back. It was it was so.

I saw him there, I saw Louis Black there, showed up and I'm sure you could randomly get just about anybody else you wanted. Suman was there the first time I ever saw her. She was very profane, very profane. Check out her interview with David Steinberg on Showtime. It's hilarious. Peter Malkin is an investor. He's eighty two now, in fact today he's eighty two. He um uh was the chairman of my b I D s at Grand Central and thirty four Street and was very uh instrumental in

this stuff getting going. And another mentor is my wife, who's a brilliant she's a litigator with a practice and fine art law. It's a fascinating practice. She formed the field, but she's a very good advisor on a lot of things. She's she should be involved in that Picasso has a lot of arts law clients who were have stuck with her over the years. But she's a brilliant advisor on a lot of this stuff and negotiation and more than just a litigator or a fine arts lawyer, she's been

very important. You mentioned White and the idea of the movable chairs. I have to ask how many of those chairs are stolen each year? Virtually zero? They really, you know, they deteriorate. They certainly they look like they're good enough to sit on, but not good enough to take. Well, that's thankfully that we knew it would go fine because when the first parks we've seen with chairs, these were actually for rent. They weren't for free. You were Green

Park and St James Park in London. The Queen's entity, which is called Royal Park Enterprises put them out and we said, um, that's interesting. They're not going anywhere. I once asked somebody, why don't they disappear? Question? Everybody asked me about my parks and they said, well, they belonged to the queen. Who would take something queen's property? So so that yeah, that's more than just stealing a chair. That's a serious yeah. But also Brian parks so busy,

it's hard to even to have a petty crime. We we took crime from five d felonies a year to zero there and it's it stays in the zero to one range. Every year there's something an assault. We had one weird incident with a guy took a machette out and hacked away at a woman, which is really upsetting because there are that was recent that there's some people in the streets. There's nothing you could do. There seems to be more than everyon more. Yeah, um, so let

me keep plowing through this. So um, we haven't really talked about books, which is always a favorite topic. What what books influenced you? Um? Or what other books have you just found to be interesting and worth mentioning. I stopped reading books when we had kids, and then I said I gotta start again. So um, I'm I'm back reading again. Forty fifty books a year and they fiction. Uh, they haven't been influential. I just read them for escape. I like Trollope and Hardy and Fitzgerald. Um, and then

management books. I've always spent half of my reading time reading management books trying to learn stuff in business. So Collins was interesting yeah, very good. I've read two of those. And UM Mark McCormick's books, which nobody mentions anymore, are really good. Whatever things. What they didn't teach you what Harvard Business School, it's kind of good horse sense about business management, UM and then UM Alan Weiss is a great one on pricing your consulting services, which Mackenzie X

Mackenzie friend of mine recommended. What is Alan Weiss's book? What's her name of pricing? I'm forgetting the name value. I'll included on the page when we talked about And then, like most privatization guys, I've read UH and and RAN

and it's it's a trial to read. But last week I had Michael Kovellan, who in his list of books mentioned Zone Ran and he says to me, He goes, I know you can't stand her, And I said, it's not that I can't stand her, it's that I was assigned at Las Shrugged in college and it was eight of the most miserable weeks of my life. The speech, it's a hundred and sixty pages one speech is it's it's brutal. I kind of semi minored in English and college and they emphasized when we did the Waste Land.

There's no way this poem is regarded as one of the great trials of English literature without the editor, who I think was as a pound um. And there's no way Fitzgerald was any good without Max Purkis perkins Um and I Rand must not have had an editor who had a liability to say anything to her because needed to be edited, whereas The Fountain has a little more under control and under Atlas Shrugged. I never I basically I had a similar experience with Stephen Um what's his

name with the stand Um. I got through the stands and everybody loves loves the author, and um trial, I just hated the four fifths of the way through. The whole book takes us crazy turn and it goes off in a different direction, and I'm like, wow, you just set me up for eight hundred pages and pulled the rug out from the other um I've read for enjoyment. I've read Philip Roth. I'm within unfortunately two or three of finishing all of his novels, and Just the Door

was the story of my childhood. So I com He's got a funny story about Fortnoy's complaint that he tells in one of the films about him, where he told his mother he sat her down deliver or something else. No, he said, you know, this is going to be very upsetting to you, but there's a book that I just finished that is going to be a massive hit and it kind of makes a little bit of fun of our family, and I just wanted you to understand. He explains the whole thing, and then um, they go away.

So after his mother died, he asked his father years later, what what was mom's reaction after I told her that I was going to have this huge hit and be a celebrity, she said, he said, she started crying, and he said, I knew it. I knew what. I knew she'd be upset, he said, not about what you think. She started crying because she thought you were having delusions of grand My son is crazy. He thinks he's gonna be a famous lot. But no, calm, it's about the actual. Uh,

that's not what she was concerned about. And that American Pastorals my favorite, my favorite, and a lot of people's never read it. Oh, it's it's fibulous if you're interested in new work. Six or eight of them really have fabulous new work stuff. In fact, he had an exhibit in New York UM the library where he first worked as a young boy. He um had an exhibit there about his family and childhood. So I know, I gotta get get you out of here in the next minute

or two. Let me jump to my last two questions. So a millennial or a new college graduate coming out of school who are interested in pursuing your career path, what sort of advice would you give to that? I always tell him the first job isn't that important. What it is as long as your boss is a smart person and cuts you in on some of the actions. So I had an internship or two where I was put in the back room, and then I had an internship or two where I was included in the work

of the office. So that's what we do with our interns. So get a job that's interesting to you on your career path. But it doesn't matter so much who you're working for as to the company. It does matter who your bosses. Look for a really smart boss who can teach you certain things. And then at that point, I often say to people, time to be an entrepreneur, and um, get out there. You are my son and daughter for assuming that route. And my wife's quite an entrepreneur to

in our own field of our laws. So um, it's easy to fail when you're young and you get up, dust yourself off and start over. Tougher to do that when you're a little older. And our our last question, what is it that you know about the development and management of public space today that you wish you knew back in the late nineteen eighties when you were starting two or three things? The programming didn't occur to us

until we opened Briant Park. Um, and the insights I've had about managing the profit and laws statement for a cause that public entity only occurred to me over time. So I probably had some dead ends and wasted a little money early. Um, but UM, no one particular insight, it just um it took a lot of uh reading and travel. One thing I would certainly say is you need to travel a ton. If you do your same path to work every day, you're not going to have

insights occurred to you. You need to get out and see what other people are doing. I kind of knew that from the beginning a little bit, but it's become more instrumental as time has gone on, Dan, thank you so much for being so generous with your time. This is, this has been fantastic. Before I go, I would be remiss if I didn't think my head of research Michael Batnick, and my producer slash engineer today Charlie Vollmer. Uh, you've been listening to Masters in Business on Bloomberg Radio. I'm

gonna do that again. I'm Barry Rihults. You've been listening to Masters in Business on Bloomberg Radio.