March 7, 2023
Costar

How New York Developer MaryAnne Gilmartin Built a Career on Embracing the Complicated

Her MAG Partners Begins Leasing Ruby Residential Tower in Manhattan’s Garment District

MaryAnne Gilmartin, who founded MAG Partners in 2020, is known for projects including Brooklyn’s Barclays Center and the New York Times Building in Manhattan. (MAG Partners)
MaryAnne Gilmartin, who founded MAG Partners in 2020, is known for projects including Brooklyn’s Barclays Center and the New York Times Building in Manhattan. (MAG Partners)

MaryAnne Gilmartin, who founded MAG Partners in 2020, is known for projects including Brooklyn’s Barclays Center and the New York Times Building in Manhattan. (MAG Partners)

The older man on the other side of the chain link fence had a shotgun and two pitbulls. MaryAnne Gilmartin, then just 22, was armed with little more than a receptive attitude.

When the dust eventually settled after that on-site meeting, she had successfully dealt with his refusal to leave the land he occupied, helping to clear the way for a project New York City sought to build. Three decades later Gilmartin, now founder and chief executive of New York real estate developer MAG Partners, would be the first to tell you her embrace of projects with complicated issues has ended up serving her well.

Gilmartin’s career has gone from that first assignment involving a vehicle towing yard to include work on buildings such as Barclays Center in Brooklyn, reflecting what she called in an interview a “tendency to lean into projects that have hair on it [and] may require a little more heavy lifting.” She’s expanded her philosophy to include “pursuing opportunities that others may not want.”

The recent kickoff of leasing at Ruby, a two-tower, 480-unit luxury residential rental development that’s 30% affordable, is the latest example of chasing projects that others might turn down. It’s MAG’s first New York development to debut since Gilmartin founded the firm during the pandemic in 2020 after buying out her partners.

The midblock property, located at 243 W. 28th St. between Seventh and Eighth avenues across from the Fashion Institute of Technology in the Garment District, is housed on a former parking lot owned by Edison Properties. Ruby is the fruit of what Gilmartin described as “far from a typical real estate transaction.”

After developers failed to buy the land from Edison, Gilmartin eventually was able to structure a 99-year ground-lease deal that led to the project named after Ruby Bailey, 20th-century fashion pioneer who lived in New York’s Harlem neighborhood.

The New York residential project Ruby, depicted in a rendering, features amenities including a rooftop pool. (DBOX)

There was “a lot of handholding,” she told CoStar News. The deal had “a lot of hair and complicated issues.”

Some of the complications involved convincing MAG’s capital partners to proceed with funding construction during the pandemic when lenders didn’t want to back projects in New York, she said.

“The building became a referendum of sorts,” she said at a real estate event this month hosted by Fordham University, her alma mater. “It’s a bet on New York City.”

‘Accidental Developer’

Gilmartin is no stranger to tackling projects that may have deterred others. She became what she described as an “accidental developer” in the ’80s after graduating from Fordham, and that led to her involvement with a lot of different projects across the city through the Urban Fellows Program.

“It was there that I realized I had real estate in my veins,” she said at the Fordham talk. “It was fortuitous. It wasn’t at all part of my plan.”

When her first Urban Fellows assignment involved the towing site at an industrial park in Queens, she said a stumbling block emerged over the 82-year-old squatter. Gilmartin decided to hop on the train to go visit him, against the advice of others.

“I know nothing about the business,” she said. “All I know is this is a person who has a set of facts and beliefs and preferences and desires. I need to understand what they are. … I literally stood on the other side of the chain link fence and talked to this very disturbed older man. … Real estate is a collection of stories about the human condition.”

Her visit paid off and paved the way for the man transitioning to special housing, clearing the site for the towing facility.

After about seven years working in public service and a two-year stint as a broker, which made her realize “being a middleman is just not in my makeup,” she went to Forest City Ratner and ended up spending 23 years there, including as president and chief executive before the firm was sold to Brookfield Asset Management in 2018.

Making Her Way

Gilmartin, a New York native, grew up in both Rockaway Beach in Queens and in Woodstock, New York, a two-hour drive north of the city. She credits her can-do attitude in part to something her mom said despite growing up in what she described as a “dysfunctional childhood.”

“My mom said, ‘You make your own way. You make your own happiness,’” Gilmartin said.

On the career front, Bruce Ratner, who co-founded Forest City Ratner in 1985 and was its CEO before eventually passing his baton to Gilmartin in 2013, was a big influence.

“I was part of the meritocracy,” Gilmartin said. “Bruce Ratner had my back. We had the confidence we belonged at the table. He said, ‘If you can dream it and can defend it,’ we usually got approval to do it. … Know your wheelhouse. You can’t fake it. If you are substantive in this business, amazing business can happen.”

One of those pieces of businesses involved MAG’s first foray outside New York, partnering with Under Armour founder Kevin Plank as well as Goldman Sachs to oversee Baltimore Peninsula, a 235-acre mixed-use development in Baltimore. Some 1.1 million square feet of office, retail and residential is opening this year on a prime waterfront location as part of the project with 13 million more square feet left to be developed.

Loves New York

“My first love is New York City,” Gilmartin told CoStar News. But within a day’s commute, “between Boston and D.C., we see opportunities. … Land demand and ground-up opportunities are much more amenable” than in New York.

A case in point of how it’s “tough” getting things done in New York, she said, involves the June 2022 expiration of the 421-a tax exemption program that gave developers tax breaks on multifamily developments in exchange for a portion of units being set aside for affordable housing. Without the support of New York state legislators, the program, which Gilmartin calls essential for business, remains dead despite backing from New York Gov. Kathy Hochul, she said.

“I’m a little jaded because of that,” she said at the Fordham event. “It’s nice to go to Baltimore. The answer in Baltimore isn’t ‘no.’ The answer is ‘yes.’ In New York, the answer is ‘no’ first. The city has to grow. … If there’s no tax-exemption program, we will have a homogeneous collection of condos that are highly unaffordable for people in the city. There’s a chilling effect” on multifamily development.

Ruby and two other Manhattan residential projects MAG has underway — 335 Eighth Ave., a 190-unit mixed-income apartment building, and 300 E. 50th Street, a 194-unit property on the east side — all qualify under the expired 421-a program, Gilmartin told CoStar.

“This isn’t a windfall for developers,” she told CoStar. “I would like to build more. Multifamily is still the darling asset class in New York. It’s difficult to imagine more projects” without the tax-exemption program.

As New York’s office vacancy rate has surged to new record highs, Gilmartin isn’t calling it quits on the sector. MAG is developing a 175,000-square-foot boutique office at 122 Varick St. in the Hudson Square neighborhood, where both Google and Disney are building major campuses.

“This is a bespoke offering. There’ll continue to be a flight to quality,” she said, adding that it will reflect “the post-pandemic world of how we want to work.”



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February 27, 2023
Bloomberg

NYC Developer Opens Chelsea Rentals as Pipeline Gets Tougher

MaryAnne Gilmartin’s first project in the city since striking out on her own will start leasing. Future efforts might become more challenging.

A rendering of an interior of an apartment at MaryAnne Gilmartin’s new development in Chelsea. Source: DBOX

New York veteran developer MaryAnne Gilmartin, who’s worked on the Barclays Center and New York Times Building, will start signing up renters for her new firm’s first completed project. 

Her firm, MAG Partners, begins leasing Monday at the Chelsea development called Ruby — named for the late Harlem-based fashion designer and dressmaker Ruby Bailey — that has 480 apartments spread across two towers. She also has two other Manhattan multifamily projects underway at 335 Eighth Ave. and 300 E. 50th St., but after the deadline to qualify for a key tax incentive expired last year, her outlook for more rental projects across the city is starting to dim.

Gilmartin is among developers warning that the New York rental market — already tough with rents hovering near record highs — could come under pressure as she expects it could take state officials at least a year or two to get serious about replacing the 421-a tax break, an incentive that encouraged building more affordable rentals. In the meantime, she expects the pipeline for rental construction to slow and some developers to turn to more lucrative condominium projects with fewer units and higher prices. 

“We’re going to have homogenized product — too much of it — brought online as a result of not having alternatives,” Gilmartin said. “That does not serve the people in New York City.”

For now, Gilmartin is focused on showing what MAG Partners can build. Ruby, the Chelsea building, plays up its proximity to the Garment District with a brick facade, herringbone flooring and generous closet space. Rents without concessions for Ruby’s market-rate apartments start at $4,330 for studios, $5,955 for one-bedrooms and $9,000 for two-bedrooms. Three-bedrooms will be priced once they’re ready to hit the market. The developer has also designated 30% of its units as affordable housing. 

The lobby of the Chelsea building, called Ruby after a Harlem-based designer. Source: DBOX

Gilmartin previously led Forest City Ratner as chief executive officer before stepping down in 2018. At that firm, she worked on the Pacific Park project that includes the Barclays Center and Renzo Piano’s New York Times Building. Her new firm is one of the few New York real estate developers that’s owned and run by women.

“There’s something about our firm that’s not ordinary, which others tell us and sometimes we forget, which is that we don’t look like a typical New York City development firm,” Gilmartin said. 

The two towers are separated by a 70-foot (21-meter) courtyard that’s full of greenery and recreation areas for residents. There’s also a roof deck and swimming pool, as well as a 5,000-square-foot (465-square-meter) fitness center. About 10% of the units have private outdoor space. 

The towers will feature a rooftop pool, as well as sprawling fitness center. Source: DBOX

Gilmartin hopes the project will show that New York rentals don’t have to be penny-pinching commodities to be profitable. 

“There are plenty of really forgettable buildings that don’t actually stand up nicely over time and that don’t represent the best you could have done, but those buildings will still make money,” she said. “The value that we have is that principles of beauty, diversity and sustainability create long-lasting value — that you can actually build beauty and deliver returns.” 



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