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Home arrow Archives   The American Surveyor     

Hold Outs! Print E-mail
Written by Andrew Alpern   
Saturday, 21 May 2016

A 6.170Mb PDF of this article as it appeared in the magazine—complete with images—is available by clicking HERE

The practice of boundary surveying involves the meticulous pursuit of physical reality and original intent, often with a need to resolve conflicts and to make up rationally for missing pieces of the puzzle. What it usually does not involve is lack of space in which to work. More often than not, the land that is to be surveyed is open and accessible. But when the client's property is in the middle of intensely developed Manhattan Island, the epicenter of New York City, surveying that property's boundaries can be an almost insurmountable task. Sometimes, it's impossible. In Manhattan, much of its land is covered by buildings, and the problem of finding an original corner beneath multiple stories of brick, concrete, and steel would yield only frustration.

Yet beneath some New York buildings lie narrow orphan strips of land that have resulted from inaccurate surveys or imprecise deed descriptions. Ordinarily these are brought to light during searches conducted by title insurance companies, and property-line agreements are drawn up between owners of adjacent lots to resolve the discrepancies. Occasionally, the city lays claim to these "ownerless" strips and auctions them off to real estate speculators. Every so often, an amateur gets into the act.

Such was the case on 23 March 1953, when taxi driver Christopher Giaimo attended a city auction and bought a strip of land 5 inches wide and 78 feet deep separating 1086 Second Avenue from 1088, between 57th and 58th Streets. Mr. Giaimo liked the fact that his new property was right around the corner from the four-story 22-foot-wide apartment house he owned and lived in at 306 East 58th Street. And he particularly liked the price: $225.

Veteran real estate investor Henry Baker already owned 1086 Second Avenue as well as two adjoining buildings on 57th Street. Hoping to create an assemblage of sufficient size for economic development, Mr. Baker approached the taxi driver, laid his cards on the table, and asked what the price would be for the 5-inch strip. Mr. Giaimo demanded $40,000, or $120 per square foot--a record for the time. Rather than lower his price when Mr. Baker attempted to negotiate, the amateur investor asserted that he would just as soon erect a lamp post on his land with his name on it, conveniently ignoring the fact that his strip of land was already inaccessible under the encroachments of the adjoining buildings. Mr. Baker considered that meeting Mr. Giaimo's price would not be practical, so he dropped his development plans, later selling what he had already acquired to an investment group headed by Edwin Glickman.

The Glickman group was more interested in removing Mr. Giaimo from the block, as it had already developed plans for a huge apartment house on the block-long site. Following a marathon negotiating session with the taxi driver in 1956, the Glickman interests arranged a tax-free exchange, worth $75,000, by which Mr. Giaimo traded his four-story house and the 5-inch strip for a five-story house nearby at 331 East 58th Street. The group then erected the Excelsior--a gradiose apartment tower atop a base of commercial and retail space. The building was subsequently converted to cooperative ownership, yielding a significant profit to the original builders. Christopher Giaimo lived out his days on East 58th Street and was pleased with the deal he struck. Henry Baker continued to work in real estate into his late 90s, but always regretted that his development plans for the site were thwarted by the demands of a neophyte land speculator seeking a huge profit.

Holdout owners who seek unrealistic prices for their property sometimes lose out completely when the developer rejects their demands and simply builds around them. That's what happened when dry-goods merchant Henry Siegel tried to out-fox rival retailer Macy's at the beginning of the 20th century.

Jesse and Percy Straus were the owners of the department store that Rowland H. Macy had established in 1858 at 14th Street and Sixth Avenue. They saw that retail trade was gradually creeping north along the avenue, with the huge SiegelCooper store opening at 18th Street and the Hugh O'Neil emporium further north. Foreseeing an eventual leap to the 34th Street hub where Sixth Avenue crosses Broadway, the Strauss Brothers began to assemble enough property to accommodate the large store they envisioned. In an attempt to acquire the land they needed at a reasonable cost, they tried to keep their plans secret by purchasing one parcel at a time through brokers acting as fronts and through straw purchasers whose purpose was to hide the identity of the true buyers--the Strauss family.

Despite their efforts to maintain secrecy, the Straus and Macy names became known in connection with the real estate negotiations, bringing their acquisition plans open to public scrutiny. When the cat was out of the bag, they still hadn't bought the corner building. This tiny parcel, a mere 30 feet by 50 feet, was owned by the Reverend Alfred Duane Pell, of an old-line New York family, whose father had bought it thirty years earlier for $30,000. Dr. Pell was in Europe at the time Macy's was trying to buy his property, but via letters and cablegrams, he agreed to sell it for $250,000.

At this point, Henry Siegel entered the picture. Having just spent a great deal of money on his own new Siegel-Cooper store at 18th Street, he feared that the new Macy's store would siphon the old 14th Street customers away and jeopardize his business. He hit on the idea of taking over the old Macy's building after the Straus brothers moved their operation to 34th Street. He could immediately open a Siegel-Cooper store there, hoping thereby to acquire the former Macy's customers as well. Realizing that Macy's would resist this move, he felt that the Pell property could serve as a vehicle of persuasion.

Siegel turned to a small-time retailer, Pop Smith, to serve as his undercover agent. When the Reverend Pell was returning home to trade his property to Macy's for $250,000, Mr. Smith discovered which boat he was sailing on, and met him at the pier. Within the hour, Dr. Pell had sold instead to Mr. Smith for $375,000. Smith in turn sold to Siegel, who then attempted to negotiate with the Strauses. Much to his dismay, they refused to buy the corner building, and moreover, elected to keep their old 14th Street store vacant for two years after they had decamped to their new quarters on 34th Street.

The architects for the Macy's store not only notched out the new building, but they provided an attractive arcade within their building to allow pedestrians to take a shortcut and avoid the corner, thereby taking retail street traffic away from the holdout. That little three-story holdout building dating from the 1860s had small windows and low ceilings. In an attempt to recoup a better return from the overly-large price he had paid for the land, Siegel tore down the old holdout and erected a new five-story one whose space could fetch a more reasonable rental. That structure is now completely hidden by a large Macy's sign, on a billboard the store leases from the owner, as Macy's still doesn't own the corner.

A more recent example of the same phenomenon can be seen in lower Manhattan across from the South Street Seaport restoration. The office buildings constructed by the William Kaufman Organization have been known for the originality of their conception and their whimsical design. To most passers-by, therefore, the huge digital clock at the corner of Water and John Streets would appear to have been a carefully planned part of the urbanistically vivacious design scheme of the office tower known by the address of 127 John Street (now converted to residential occupancy) and an appropriate foil for the unusual street furniture provided by the building's developer.

Ironically, the real reason for the clock's existence is usually overlooked. Unobtrusively tucked in behind the 30-foot-high clock are two small buildings, joined at the ground floor by a restaurant. It was the refusal of the owner of one of those buildings to sell his property at a reasonable price that led to the concept of the clock that now charms and delights the people of the neighborhood.

During the 1960s, the longtime New York City developer William Kaufman acquired 16 of the 18 properties that comprise the block at Water and Fulton Streets on which he hoped to erect a new office tower. Of course, he wanted his new building to encompass the entire block. He didn't reckon on Robert Ardston, however.

Mr. Ardston was a businessman and real estate investor who had bought the four-story 20-foot-wide building at 133 John Street in 1954. Later, he made some alterations to the building and removed the upper two stories. He had also made other real estate investments, one of which proved very lucrative. He bought a very small corner property in the Wall Street area which the Lehman Brothers firm subsequently wanted to acquire in order to have what they considered a suitable site for a new building. As they intended to construct an institutional building rather than a speculative one, they were willing to pay far more for Mr. Ardston's corner lot than what a customary financial analysis would have dictated. Consequently, Mr. Ardston received a reported $1 million as the holdout price for his little piece of property.

Having realized such an unusually high return on his original investment, Mr. Ardston may have thought that he'd be able to repeat the experience when he entered into negotiation to sell his John Street building to William Kaufman. Although the property could support a holdout price of perhaps $200,00, Mr. Ardston demanded the neat round figure of $1 million.

Apparently, Mr. Ardston thought office building developers might be infinitely wealthy and able to pay virtually any price to assemble a construction site. Refusing to negotiate realistically, he exhausted the patience of William Kaufman, who passed the task of dealing with the recalcitrant holdout to his son Robert. Robert Kaufman was no more successful than his father in convincing Mr. Ardston that there was a relationship between the land price and the return that might be expected from the additional rentable area that could thereby be built.

Robert soon gave up in favor of his brother Melvyn, who ultimately dispaired of coming to acceptable terms with Mr. Ardston. Rather than pay an uneconomic price for the remaining two parcels that Mr. Ardston controlled, Mr. Kaufman cut a 4-foot by 41-foot notch out of his office tower, and a slightly larger piece out of the six-story base, and built around the pair of holdouts. To hide the raw exposed side of the easterly structure, Mr. Kaufman devised the giant billboard-sized digital clock, thus turning what might have been a liability into a distinctive asset.

These holdouts were unrealistic, but there are other driving forces behind holdouts too. Some are merely stubborn and disruptive, reveling in being the center of attention and having their fifteen minutes of fame. Others are frightened of being taken advantage of, or scared that their personal secrets may be revealed in the process of selling and relocating. The clever ones do their homework, determine what the true value of their property is to the developer and then negotiate hard until they get a price that reflects that value. It’s the stubborn and unrealistic holdout owners whose buildings remain, and it is those architectural anomalies that lend quirky look to some of our cityscapes.

Andrew Alpern is an attorney, architect, and architectural historian, who lives in New York City. This article is adapted from HOLDOUTS! The Buildings That Got In The Way, which he wrote with real estate developer Seymour Durst.

A 6.170Mb PDF of this article as it appeared in the magazine—complete with images—is available by clicking HERE

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