Recently, the NY Marriott At The Brooklyn Bridge celebrated the 25th anniversary of its grand opening. While today there are many vibrant hotels throughout Brooklyn, just over a quarter century ago, to many, the idea of hotel development in Brooklyn was a lot more far-fetched. The notable exception was real estate developer Joshua Muss and Muss Development, which had a singular vision that Brooklyn – a borough so large that on a standalone basis it would be the fifth-largest city in the U.S. – could not only support, but desperately needed, a high-quality full-service hotel. Muss recognized that Brooklyn was then a hotel wasteland.
Lenders, however, were skeptical, believing that people would visit Brooklyn during the day, but would want to return to Manhattan in the evening. But Muss convinced them to take what seemed like a risky move in backing the Marriott. It paid off: Not only was the Marriott a significant win for Brooklyn residents, businesses, tourism and new job opportunities, but its success ignited competition. Several new hotels in Brooklyn soon followed in its footsteps.
How Muss accomplished this feat serves as an important case study for the modern-day New York City business and real estate communities, particularly as the city continues to grapple with the persistent challenges of post-COVID economic recovery, including a difficult political and regulatory environment and high interest rates. For smart creative developers with a strong vision, tenacity and the necessary resources, the outer boroughs and parts of Manhattan have significant “below the radar” opportunities to spur economic growth. Local developers in particular can be crucial assets in identifying untapped opportunities in neighborhoods they know well. Such opportunities may not be readily apparent to “outsiders”. Local developers’ nuanced understanding of the city’s market, and how to accomplish things in a particular borough or neighborhood, are invaluable in not only generating opportunities, but also in identifying the challenges and how to proactively solve them.
For decades prior to the development of the Marriott, the primary hotels in Brooklyn were either relics of ancient history or “short stay” accommodations, such as the St. George Hotel (completed in 1890 and 1929) and the Hotel Bossert (opened in 1909) or the Golden Gate Motor Inn (opened in 1964). The dearth of quality hotels in Brooklyn led Brooklyn courts to transport sequestered juries to a hotel in Staten Island.
Collaboration is a key component of these ambitious, visionary projects. Identifying the local business and community leaders who can serve as strategic partners and help achieve a shared goal is often “the secret sauce.”
For instance, as lenders considered Muss Development’s proposal for the Marriott, they said that if Muss could find an office tenant for an adjacent office building site Muss intended to develop, the lenders would finance the proposed hotel. A solution came in the form of then Brooklyn District Attorney Joe Hynes, who desperately needed more office space to accommodate his growing staff, some of whom were working at desks in office hallways. The Muss Marriott “project coalition” included then Brooklyn borough president Howard Golden who had been championing Brooklyn’s potential for economic growth, as well as Robert Catell, the then CEO of the Brooklyn Union Gas Company. Catell organized substantial support for the hotel project from the Brooklyn business community.
Together, Muss, borough president Golden, Robert Catell and DA Hynes convinced the city to lease Muss’ proposed new office building for Hynes’ prosecutors and staff. That paved the way for the lenders to finance the Marriott. Their successful collaboration showed the value of identifying and enlisting partners with the strategic local expertise and relationships. Absent strategic supporters, even the best ideas will struggle to get off the ground, and may never move beyond the proposal stage.
While it may be difficult to imagine the time when developing a hotel in downtown Brooklyn was considered a significant business risk, that was the reality. In addition to proselytizing about the strong need for local hotel rooms, Muss had to overcome countless land use, leasing, financing, construction and political obstacles. Once opened, the Marriott became a magnet for visiting tourists and business people and Brooklyn residents’ visiting guests. Moreover, a plethora of Brooklyn organizations and social events kept the hotels banquet rooms constantly booked. The hotel’s success drew the attention of others in the hotel industry and ignited extensive outer borough hotel development.
Now more than ever, developers and others in the real estate and business community need creative and out-of-the-box solutions to help grow the city’s economy. As the Marriott story demonstrates, a significant new development in this city needs a strong vision, backed by deep-seated local knowledge and strategic partnerships. One successful project can have a ripple effect that can spur growth on a neighborhood level, a borough level and in the city as a whole.
Scott Mollen is a partner in real estate with Herrick Feinstein, LLP, Manhattan, N.Y.
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