Replies

The scandalous history behind Kushner’s ritzy Midtown building / By Steve Cuozzo, NY Post, April 18, 2017

SNIP......smoke and a scandalous history have long shared satanically addressed, money-hemorrhaging 666 Fifth Ave.The building’s owner, Kushner Companies, was until a few months ago headed by the family of President Trump’s son-in-law, Jared Kushner, now his top adviser. To bail itself out of the jam at deep-in-the-red 666, the Kushner company needs a partner to kick in $2 billion and add about 40 floors, turning it into a 1,400-foot-tall cloudbuster designed by the late architect Zaha Hadid.

After proudly rising amid the 20th-century Manhattan skyline, and changing hands three times, 666 Fifth Ave. has become a devil’s bargain for Kushner.In the late 1950s, Tishman Realty and Construction wanted its new 666 Fifth Ave. to stand out from the herd of flat-topped new skyscrapers. It dressed the facade up in aluminum panels — a result “more dull than glittery,” architectural historian Carter B. Horsley wrote.

The office floors filled up. Alitalia’s elegant ticket office and showroom came to epitomize the era of glamorous air travel.

But what really put 666 Fifth on the map was Top of the Sixes, a 41st-floor restaurant with fabulous views. It featured “Cocktails in the Clouds” for a then-pricey $1.25 and food of which one critic snarked, “Beef stroganoff was a Swiss steak on noodles reminiscent of a hundred airline meals.” In his 2007 memoir, “The Wolf of Wall Street,” Jordan Belfort recalled lunching at Top of the Sixes with a pal from LF Rothschild, downstairs. “It was where Masters of the Universe could get blitzed on martinis and exchange war stories,” Belfort wrote, as depicted in the 2013 movie.

Tishman Realty sold the tower to Japan’s Sumitomo for $500 million in 1987. The new landlord installed the Grand Havana Room after Top of the Sixes couldn’t afford a new lease. The club was born one day in the 1990s, when investor Stan Shuster was having lunch with Arnold Schwarzenegger in Los Angeles. As they puffed away outdoors, a woman nearby growled, “Stop smoking cigars,” Shuster told the online magazine Cigars Connect. He vowed to launch places where smokers would feel happy.

The cooing-couples scene at the top of 666 gave way to bicoastal, boldface intrigue. At a 1997 pre-opening bash, the Times caught “Tom Selleck sharing a smoke with Gregory Hines, Laurence Fishburne puffing away with Stephen Baldwin, and Carol Alt lighting an Arturo Fuente for Jennifer Tilly.” In later years, Sharpton would head for a leather armchair in a secluded corner and schmooze with Michael Jordan, Jay Z and city power players like Rudy Giuliani and John Catsimatidis.

Sumitomo unloaded 666 Fifth in 1998 at a loss to Tishman Speyer — a different company than the original owner — for $518 million, less than what it had spent to buy and upgrade the building. Tishman Speyer in turn put it on the block in the early ’00s and made a fortune. The top bidder was Kushner Companies, a firm founded by Charles Kushner, Jared’s father. It had holdings around the US but not a Manhattan “trophy.” The company’s quest for such a property was clouded by one of the more lurid scandals in real estate annals.

Charles Kushner learned that his sister Esther’s husband, William Schulder, was cooperating with feds who were investigating him for illegal campaign contributions and tax evasion. For revenge, Charles hired a hooker to seduce Schulder, videotape their sex romp and send the tape to Esther.

The scheme, as described in a July 2004 indictment of Charles Kushner, “read like pulp fiction,” The Post reported. Charles paid the “very attractive, high-end call girl for an elite escort service” $10,000 to lure Schulder to a Bridgewater, NJ, motel after she pretended to need a ride when her car broke down.

Esther turned the tape over to the feds. In a letter to his sister that was among 165 submitted to a judge requesting leniency for his crimes, Charles begged, “I only ask that you forgive me for resorting to such despicable behavior;. I was wrong and I committed a terrible sin.”

He pleaded guilty in 2005 to making illegal campaign contributions, tax evasion and witness tampering. He served 14 months of a two-year sentence in a federal prison. Before he was released in August 2006, he turned his company’s operations over to Jared, then all of 25.

With Jared at the helm, Kushner Companies paid Tishman Speyer a staggering $1.8 billion, using mostly borrowed money, for 666 Fifth. It was nearly twice as much on a per-square-foot basis as any previous Manhattan building sale. The deal closed on Jared’s birthday, Jan. 10, 2007.

Kushner’s “trophy” couldn’t take in enough rent to cover the debt. By 2009 it was making just 69 cents on rent for every $1 it owed. It’s deeper underwater today, even though Kushner earlier sold its precious store space for $525 million to a partnership in 2008 and a 49 percent stake in the office portion to Vornado in 2011. Thirty percent of its aging offices are vacant, partly because Kushner has kept them off the market to prepare for redevelopment. A $1.2 billion mortgage is due in two years.

Smoke and a scandalous history have long shared satanically addressed, money-hemorrhaging 666 Fifth Ave.
Rather than simply modernize the tower as many landlords have done, Jared dreamed up the idea to replace 666 Fifth with a super-tall skyscraper containing luxury condos, a hotel and a shopping atrium. It would even get a new address — 660 Fifth. It would need a staggering investment by new partners: $2.5 billion up front, plus an unheard-of $4.1 billion construction loan. A partner would have to buy out Vornado, the stores and the Grand Havana Room.

Jared sold his shares in 666 Fifth to a family trust earlier this year. It was to avoid conflict-of-interest issues over his White House role. He now has “no role” in the company, his rep says.