Billionaire’s small buildings making big money in NY

Bloomberg

Axel Stawski is not the kind of real estate mogul who boasts about the size of his towers.
The developer owns six Manhattan office buildings, one of the largest being 565 Fifth Ave., a 380,000-square-foot (35,000-square meter) property completed in 1993 on the corner of 46th Street. At 30 stories, it’s not one of New York’s tallest skyscrapers. Yet what it lacks in size it makes up for in style, with abundant natural light, crafted patterned wood fixtures and 24-foot (7-meter) lobby walls made out of Italian marble.
“It’s not overwhelming, it’s not overbearing,” Stephen Sunderland, senior managing director of New York real estate brokerage Optimal Spaces, said of a typical Stawski property. “But you think, whoa, someone really thought this out.”
Attention to detail — and a focus on boutique buildings catering to a smaller number of tenants — has helped bring Stawski, the 65-year-old founder and president of closely held Stawski Partners, a net worth of $2.4 billion, according to the Bloomberg Billionaires Index. That puts him near the ranks of Donald Trump, the New York developer turned presidential candidate who has a $2.9 billion fortune, according to the index.
Stawski’s Manhattan office properties average a relatively small 316,000 square feet – less than one-eighth the size of the Empire State Building. In comparison, Sheldon Solow — the city’s joint fourth-richest real estate developer, according to the index — has about half of his $3.7 billion net worth tied to the 1.4 million square-foot building at 9 West 57th Street.
Stawski prefers smaller properties on corner lots, and has rebuilt two of his three Fifth Avenue office towers from the ground up. A focus on design makes buildings quicker to lease and helps to attract and keep desirable tenants longer, said Michael Cohen, president of the tri-state region at real estate services firm Colliers International Group Inc.
“He has very good aesthetic taste, and that matters in this town,” Cohen said.
Selective Timing
Stawski has emerged as a “dynastic developer” because he builds properties and holds on to them, benefiting from long-term appreciation of New York real estate that other builders may miss out on by choosing to sell and use money elsewhere, Cohen said. The billionaire also has benefited from being choosy about his projects.
“Axel’s track record is the opposite of prolific,” Cohen said. “There are some people that when they perceive the time right, they buy and develop property like mushrooms, but Axel seems to be selective.”
Stawski’s tenants include Fitch Group Inc., which has one of its two international headquarters at the billionaire’s Broad Financial Center at 33 Whitehall St., and the central bank of Norway, at 505 Fifth Ave.
“They’re very hands on — in a positive way,” Sunderland said of Stawski and his team.
“I’ve done this for 30 years and I’ve never heard anything bad said about him. That’s phenomenal in New York.”
Stawski also co-developed three residential buildings in Manhattan’s Soho and West Village neighborhoods. At the newly constructed 27 Wooster St., a $28.5 million penthouse went under contract after just six days on the market in December 2014, according to listings website StreetEasy. The billionaire stuck to his boutique approach on the eight-unit building as well, such as through requesting that every window open inward so they’d be easier to clean.