speculation on 15 CPW

bjw, i agree that there is no reason to be obsessed with people, but it is indeed frustrating when someone is authoritative and, indeed, highly critical of others based on something that turns out not to be true. i really don't care one way or the other about malraux, but given the way he talks on here it is pretty incredible to discover that he actually owns no investment property whatsoever. he still may be a real estate expert, a great guy, a genius, whatever. but he does not own investment real estate.

This thread is more fun than watching shoes thrown at President Bush.

happyrenter, I have no problem with your civil approach (I would like to see it catch on here, actually), though malraux isn't really that condescending (esp compared to some well-known perps around these parts). I don't understand the issue here though - so what if malraux doesn't actually own these properties? He's the one making the decisions and thinking through the investment - that process is at the root of this thread (and of this board, to a large degree). The paperwork and actual ownership is largely inconsequential.

"He's the one making the decisions and thinking through the investment - that process is at the root of this thread (and of this board, to a large degree)"

good point. Fiduciaries face consequences for their decisions.

I think 15 CPW is gorgeous. IMO, it's location & new construction make it a trophy blg, which is not to say that its value/prices couldn't decline along with the market. But, it certainly is not a generic bld, it is special & that in & of itself has intrinsic value.

bjw,

malraux's big criticism of other people and their arguments is that they have no skin in the game--as he told me, i'm "sitting in an armchar." in fact, HE is sitting in an armchair. let me put it in terms of my own situation. i run a hedge fund (a very, very small one, and one that got started in the last year, so don't go thinking i am a zillionaire). if i didn't invest in the fund myself, but only bought for other people, would i have the right to say "i own coca cola stock, i shorted general motors," etc. NO. i would simply be the agent making purchases for other people. i am on the board of a music school, and we are currently looking to sell one building and purchase an additional building for the school. can i say "i am selling my townhouse in brooklyn." NO. It's not my townhouse. i'm simply a fiduciary making decisions on behalf of a non-profit corporation. this is not a question of paper work, it is a completely different thing to buy something for yourself and to buy it for someone else. malraux has no investment properties. as i said, he still may have valuable opinions, he may be a genius, he may know more about real estate than anyone else on this board. but he should be honest about his situation.

Happyrenter,
I see your point & agree re: buying as a fiduc isn't the same as buying for one's self.
However, what bugs me is that many discussions devolve into personal attacks & trolling. There's a thread now where someone kinda impersonated someone else just to poke fun/attack. I just wish we could have more substantive discussions. There's a lot of very intelligent people on this board & their thoughts & info are valuable.

Whatever the nature of Malraux's relationship to 15 CPW is, it seems he has some relationship to it. Whether or not one believes him is up to the individual. This is an anonymous board; I could be sitting in Oshkosh & making everything up. I think posters here are bright enuf to decide for themselves. Nonetheless, I do see your point.

dwell,

i totally agree. the personal attacks are just silliness and it makes much more sense to take people at face value because, as you say, it's an anonymous board. but when someone is very critical of others and makes a big show of his active investment portfolio and then turns out not to have one....i'm sorry, but that's quite irritating.

Happyrenter,
I do see your point. Feels like the king has no clothes, right? One must be careful with the statements that one makes cuz they can come back to haunt.

I have found many of malraux's posts on streeteasy, informative, intelligent and balanced.

However, like happyrenter, I am disturbed by his characterization of his investment activities in NYC RE. Details matter, and I would find him a lot more credible going forward if he clarified his role and that of the trust he describes. I know his goal in life is probably not for me to find him credible, but he does take the time to post on this boards, and I would imagine he wants to be taken seriously. If so, he should resurface and explain himself.

happyrenter, do you have an offline email? I'd be interested in hearing more about your hedge fund, and perhaps sharing experiences.

goreadkant@gmail.com

Happy & new,

I know almost nothing about hedge funds & would love to hear your perspectives. So, if you care to share, please post away.
Thanks

my perspective on hedge funds is this: they are great for the fund manager and lousy for the investor. essentially, hedge funds have allowed investment managers to triple or quadruple their historical fees. it used to cost at most 1% of assets to invest with a quality manager. in a hedge fund it usually costs 2% of assets plus 20% of the investment return. basically, the gap between corporate profits and investor returns has gotten bigger, and that's never good for the investor. you don't hear about people getting rich investing in hedge funds, you hear about people getting rich starting hedge funds. unless you have a particular talent for spotting brilliant investment managers, stick to index funds.

HappyR,

Wow!! Thank you for the frankness. Good point: ya make $ by starting the fund, not investing in it. Thank you for sharing.

i assume you aren't a potential client :).

I don't know. Think I'm too chicken to put $ in a HF. Sorry, kiddo.

There's an old joke...

A hedge fund manager takes his new analyst out to the marina.

"Son, this is the dream you can achieve. Over here is my grand yacht. To the left are my colleagues yachts. To the right are the yachts owned by the Venture Capitalists and the Private Equities."

"But, that's the entire Marina, where do the investors park their yachts?"

"Son, investors can't afford to buy yachts"

happyrenter, I'll write offline, thanks.

I happen to generally agree with your hedge fund assessment, think the model is fundamentally broken (as exposed by the 2008 returns, where hedge fund managers get to keep their carry from prior years and investors are left losing all their prior paper "profits"). So I have to ask a question on the thread:

Given your assessment, why are you running a hedge fund? I suppose you could simply answer that you're doing it to make $$, and if your investors invest with you because they are stupid, it's their problem. But I suspect that's not your answer, is it?

why am i running a hedge fund? because it's fun and lucrative! i mean, i don't aggressively market at all, i tell my clients what i do, and they can hire me or not. clearly i believe i have the capacity to make good returns; i can't guarantee that i will, but i invest alongside my clients and do my best for them and for myself. do i think my clients are getting a good deal paying me 2 and 20? NO! if i did, i would raise my prices! i think i am the one getting a good deal. if investors eventually rebel (as they should) and insist on a lower fee structure, i will lower my fees and keep doing exactly what i do.

jgr,
yup, ain't it the truth.

happyr,
Bless you for your honesty. really appreciate it.

My hope/expectation is that investors in hedge funds will demand lower fees and/or a change in the structure. I certainly would following 2008 if I was an investor.

apparently malraux has disappeared. very disappointing. he should at least explain himself.

The pus for lower hedge fund fees started even before the crash... its pretty much guaranteed now (you just need a few to start).

Plus, "hedge fund" is going to be a dirty word for decades. They won't get the same inflows...

Plus, guaranteed to have regulation now. The Madoff stuff pretty much locked that in. No way to have vehicles - no matter how sophisticated the investor - where you can't tell if there are any assets left until its too late.

w67thstreet disappeared too.. .where is that guy?

Malraux,
i started this thread so I wanna weigh-in. Malraux, I dont believe you for a second any more than I did a few months ago.
2 BR units facing the park, NEVER went for 1250 psf. I know two people who bought large apartments at the earliest insider prices who got in through Whitehall. Sorry bud, dont buy your BS

bfgross - i would have to agree with you. even the earliest sales facing the park went for $2500 psf. there is zero chance malraux got that price unless he is the super. the supers apt may have gone for that! i'm joking - i know the super. NO WAY at $1200 psf, you can check public records...

I'm not a fan of stalkers, but ... it depends on what malraux means by park-facing, if he means front-on views of CPW, I've not seen any 2-bed lines close on ACRIS for 1300ish/foot. If what he means is side-view, as in lean out your window on either 61st/62nd, it's possible.

10023 -
No units in 15 CPW ever went for 1250 psf, at any time, ever....
sorry

Unless the beneficiary of the trust was a Zeckendorf son/grandson/etc.... Believe me there are deals in NYC RE all the time... People do things b/c of relationships... it's true in the White House and it's true in the homeless shelter.

Like I said... I did commercial NYC RE in 1995 for $312.5psf.... it was a "semi" inside deal.... as the brokers involved got something in return (from me), but those numbers were not unheard of.

Much easier to look up info here than using the online ACRIS.. Can't find anything close to $1250.. I call shenanigans..

http://www.nyc.gov/html/dof/html/property/property_val_sales.shtml
http://www.nyc.gov/html/dof/html/property/property_val_annual_sales.shtml

evidently malraux, having been called on his lying, has tucked his tail between his legs and crawled away. sad, really.

That's the problem with building up a phony persona. So many little lies you have to keep straight with people a lot smarter than you.

HAHA! This is just too funny. Some people were believing Marloux's nonsense about how this building will fall to $1k/ square foot. FOR A PARK VIEW! HAHA! I know this thread has outed Marloux but I can't help but quote "15 CPW will bottom about where I initially bought in, I'm guessing $1,000 - $1,200 psf. This $3K -$4K (or more) psf stuff is/was absolute short term nonsense. IT'S OVER, PEOPLE! Time to get real, if you bought to flip (or have to sell due to a situation beyond your control)." 'It's over people! Hahahaha!' Second floor units facing the courtyard are at $4,500/sqft. And in his mind park views were going to fall down to 'where he 'bought in' at $1k/sqft. On a slightly different note, what has happened at 15 CPW is amazing - I'm not sure how much longer prices can rise but I highly doubt prices will be falling anytime soon.