Rent-stabilized tenants in the outer boroughs are increasingly facing malign neglect from greedy landlords who try to pressure them to leave through tactics such as setting the freaking building on fire. But sometimes a developer has no choice but to use legal means to persuade long-time rent-stabilized residents to move along. This usually involves writing a fat check, and in particularly desirable districts, the checks can be fantastically fat—the record appears to have been set by one reclusive Central Park West resident who shook down a pair of developers for $17 million.
The story of "hotel hermit" Herb Sukenik is recounted in the forthcoming book House of Outrageous Fortune by Michael Gross, who tells the quintessential New York story of 15 Central Park West, the city's most exclusive building. It's now home to residents like Goldman Sachs CEO Lloyd Blankfein and Alex Rodriguez, but before that the property was home to the old Mayflower Hotel and a handful of mostly elderly men living in very small rent-controlled apartments in the top floors.
After buying the Mayflower in 2004, developer brothers Arthur and Will Zeckendorf were required to buy out the rent-stabilized tenants before they could raze the building. The last remaining holdouts settled in the million-dollar range, but one Herbert Sukenik, 73, wouldn't budge. Will Zeckendorf describes Sukenik as "a nightmare. Hugely intelligent, a Ph.D., unmarried, embittered, a loner, disconnected from society, and too smart for his own good. " Here's an excerpt from House of Outrageous Fortune that reveals how one isolated old man with nothing to lose turned a shabby little apartment into $17 million:
The Mayflower’s last holdout was short and balding with a wild fringe of gray hair and the “old-man smell” of someone who “didn’t shower much,” [relocation lawyer Michael] Grabow says. “He was clearly brilliant.”
“I wasted my life,” the embittered Sukenik told Grabow. His father had died while he was finishing his medical degree and left him enough money that he didn’t have to work. “I could have been at the heart of research into CAT scans and MRIs,” Sukenik said.
“Instead, I’ve been up here 30 years doing crossword puzzles.”
Grabow learned Sukenik was universally disliked by the Mayflower staff. He never let anyone into his room to clean, even though he was entitled to maid service. “He was a bitcher, a complainer,” says a former Mayflower manager. “He had fun with me,” Grabow says. “He had a nice time beating me up.”
Sukenik knew the precise acreage of his block and how much the Zeckendorfs had paid. He’d calculated the taxes, insurance and carrying costs of the empty properties and recited them all to Grabow. And he wouldn’t begin negotiations until his three fellow tenants were gone. “He knew the last man standing was very valuable.”
His key demand had been a park view, so a broker took him to Essex House on Central Park South and showed him a 2,200-square-foot, two-bedroom unit on the 16th floor.
“It looks like a bed of green,” he rhapsodized, staring out at Central Park beneath him. Grabow sent Sukenik a letter spelling out their agreement: The Zeckendorfs would buy the condo and retain ownership, but he could have it for life and they would even furnish it for him.
The one demand they refused was free meals twice a week at the Essex House restaurant, then run by the world-renowned chef Alain Ducasse.
Sukenik’s response to the letter was silence. “Which was not like him,” Grabow says.
Then, David Rozenholc, a noted tenants’ attorney, called Grabow, and the moment he started talking, it was clear things had changed. Rozenholc told Grabow that Sukenik wanted more than the apartment and moving expenses. A lot more. Grabow hung up and called Sukenik.
“I thought we had a deal,” he said.
“We didn’t,” Sukenik replied, “and now I have a lawyer.”
He went on to confirm that he did now want money — even though he had no use for it, no kids, no charitable impulse, and didn’t want to leave it to his brother. The Zeckendorfs decided to play hardball. They separated the two halves of the building lobby and began demolishing the southern end.
Sukenik’s response? “Oh, I love to watch construction.” Jackhammers began pounding away for hours a day. “I love the noise,” he said.
The Zeckendorfs served Sukenik with papers setting in motion the multiyear demolition-related eviction process they’d hoped to avoid. “Finally, it had all come down to a simple question: Where’s the cash?” Will recalls. “This is just a break-the-phone moment. We’ve got a 52,000-square-foot property with one tenant.”
The Zeckendorfs turned to a third lawyer who knew Rozenholc. “And finally, we get a number, which is enough to break another phone.”
But at last they had a deal. Fortunately, during Sukenik’s extended silence, they’d bought the Essex House condo, which set them back $2 million. They won’t reveal the additional sum they finally paid Sukenik; Will says only that it was “by far the highest price ever paid to [relocate] a single tenant in the city of New York.”
It was $17 million, according to someone with knowledge of the transaction.
You can read a larger excerpt from House of Outrageous Fortune in the Post. And don't feel too bad for the unimaginably rich Zeckendorf brothers—that $17 million was chump change for them. 15 Central Park West is now home to the most expensive apartment in NYC, which was sold to a Russian plutocrat for $88 million last year.