Crains New York - May 14, 2012 - (Page 2)

IN BRIEF THE METROPOLITAN TRANSPORTATION AUTHORITY MIGHT OUTSOURCE THE management and operations of the tunnels, track and 360,000-square-foot station being built under Grand Central Terminal. The authority paid Scottsdale, Ariz.-based InfraConsult $600,000 to assess the feasibility of privatizing the operations of the concourse, which will have 23,000 square feet of retail space and open in approximately 2019. The report, completed in February, has not been released. The MTA has yet to make a decision, a spokesman said, but does expect to have a private company manage the new Fulton Street Transit Center, which it is calling Fulton Center to brand it as a shopping destination. Next month, it will issue a request for proposals for a company to operate the center, which includes 32,000 square feet of retail space. “The [company] will function like a shoppingmall manager,” an MTA spokesman said. “They’ll get a percentage of the revenue, which gives them an incentive to make everything work well.” HEADY TIMES: Majority owners Eric (left) and Robin Ottaway flank co-founder Steve Hindy. buck ennis THE NEW YORK CITY TRIATHLON HAS SIGNED A NEW TITLE SPONSOR. SKIN BALM AQUAPHOR inked a three-year agreement to put its name on the annual event. Though financial terms were not disclosed, Aquaphor, which is owned by Wilton, Conn.-based Beiersdorf Inc., is paying more than previous sponsor Nautica. The triathlon, now in its 12th year, costs nearly $2 million to produce, according to John Korff, president of its organizer, Korff Enterprises. More than 3,000 athletes are expected to participate in this year’s race, to be held July 8. From print to pint: Newspaper scions hop on at B’klyn Brewery Steve Hindy hands over control of his craft-beer business to Ottaway heirs BY LISA FICKENSCHER Eric and Robin Ottaway could have easily joined their family’s newspaper business. The brothers are heirs to the legendary Ottaway chain of community newspapers, which was sold to publishing giant Dow Jones & Co. more than 40 years ago. But they chose an entirely different career path: running Brooklyn Brewery, financed by their father. Despite their family fortune, Eric, 43, and Robin, 38, have worked up the ladder, from driving forklifts to selling beer out of a warehouse. “For me, it’s the only thing I’ve done,” said Robin. “It wasn’t glamorous in the beginning.” Now they are poised to take the reins of the best-known brewery in New York.The brothers have spent the past 17 years at the Williamsburg-based plant working alongside its co-founder and president, Stephen Hindy, who has been quietly handing off responsibilities to them. Just two years ago, Mr.Hindy sold his voting shares to the Ottaways, who had been among the brewery’s first investors and are now the majority owners of the 24-year-old business. “Over the past several years, Robin and Eric have taken over the day-to-day management,” said Mr. Hindy. “I’m basically mentoring them.” While Mr. Hindy, 63, will continue to be the brewery’s spokesman—he is also an important voice for the craft-brewing industry—and to handle legislative issues and marketing, he plans to pare back his workweek over the next few years. The brothers are stepping up at a time when Brooklyn Brewery’s growth is skyrocketing, fueled by an aggressive expansion amid the rising popularity of craft beer. It is currently the 13th-largest craft-brewing company in the U.S., up from 20th in 2010, according to the Brewers Association. Brooklyn Brewery is also the largest exporter among U.S. craft breweries, said Mr. Hindy. Revenues grew by 30%, to $35 million, in 2011 and are on track to reach as much as $50 million this year, according to Eric, who is the brewery’s general manager. The company recently invested $12 million to double its production in Williamsburg to 100,000 barrels a year. It also brews at a facility in Utica,N.Y.“Any future growth will See BREWERY on Page 24 BY THE NUMBERS Weekly shift of the city’s economy UNCERTAINTY RULES Maybe Europe’s policymakers will eventually steer things toward growth, but in the meantime, the euro crisis is upending plans around the globe. INCREASE PEAK TWEETS BANK OF NY per minute about in April sameMELLON shareholders who gay marriage after store sales, down the president from a 7.6% rise a voted no on year ago endorsed it executive pay Source: SNL Financial Source: Twitter.com Source: Kantar Retail 41% 7,347 1% ¡VIVA! Hispanics accounted for 29% of the city’s population and grew by 8% in the decade ended in 2010. Hispanic population change by borough, 2000-2010 Bronx 15% 0% Brooklyn -3% Manhattan Queens 10% National broker struggles in NY 20% 30% 40% 51% 50% 60% Staten Island -10% 0 10% Source: 2010 Census ADDICTED TO NUMBERS? GET A DAILY DOSE AT @STATSANDTHECITY CORRECTION Hilary Ring, the MTA’s director of government affairs, will become senior director, capital programs, June 1. His sex was misstated in the May 7 Insider. vol. xxviii, no. 20, may 14, 2012—Crain’s New York Business (issn 8756-789x) is published weekly, except for double issues the weeks of July Fourth, Labor Day and Christmas, by Crain Communications Inc., 711 Third Ave., New York, NY 10017. Periodicals postage paid at New York, N.Y., and additional mailing offices. Postmaster: Send address changes to: Crain’s New York Business, Circulation Department, 1155 Gratiot Avenue, Detroit, MI 48207-2912. for subscriber service: Call (877) 824-9379. Fax (313) 446-6777. $3.00 a copy, $99.95 one year, $179.95 two years. (GST No. 13676-0444-RT) ©Entire contents copyright 2012 by Crain Communications Inc. All rights reserved. Keller Williams’ name and commission model fail to catch fire in city’s tough real estate market BY AMANDA FUNG One year after Keller Williams launched in New York City with high expectations and an innovative business model, many are saying that the nation’s second-largest residential real estate franchise company may have met its match in the hypercompetitive Big Apple market. To its credit, the company has succeeded in attracting 174 brokers and in opening a fancy new Park Avenue headquarters earlier this month, but observers note that the New York franchise has yet to lure any of For Austin, Texas-based Keller the city’s top producers or land many exclu- Williams, that’s a killer—at least at pressive listings—much less high-profile ones. ent. Helped by its business model, which And in a city dominated by two brokerage allows brokers to keep 100% of their comgiants, Prudential Douglas Ellimissions beyond a certain level man and the Corcoran Group, as GOAL and to share in the firm’s profits, well as a host of other established it has attracted an army of more firms specializing in neighborthan 80,000 agents across the hoods or in specialized segcountry. In major markets such ments—from townhouses to as Florida and California, and in BROKERS that high-end co-ops—Keller’s lack 690 cities in the U.S., Keller of a recognizable brand name Keller Williams Williams has thrived—so much expects to field hurts it here. so that both Stanford University “I’ve heard nothing but posi- in NYC by 2017 Business School and Yale School tive things about Keller Williams of Management penned case NYC,” said Steve Spinola, presistudies on the firm’s system. dent of the Real Estate Board of New York, But in New York so far, the industry’s the powerful industry trade organization key players—the top brokers—have given that boasts no fewer than 500 residential the firm a pass. The only star Keller brokerages as members. “But there is no Williams NYC has attracted to date is Ilan See BROKER on Page 24 question that brand helps.” 700 2 | Crain’s New York Business | May 14, 2012 http://www.Twitter.com

Table of Contents for the Digital Edition of Crains New York - May 14, 2012

Crains New York - May 14, 2012
Contents
Brooklyn Brewery taps new leaders
Out-of-town broker hits a local wall
Pearson’s test flubs could cost it dearly
Enrollments are up at summer camps
Real Estate Report: Third Ave. bargains

Crains New York - May 14, 2012