Ross stands on an unfinished section of the High Line park in Manhattan. The 17 buildings in the Hudson Yards project will be built on massive concrete platforms on top of the rail yards behind him.


(Fortune) 《财富》杂志

Stephen Ross is pitching the dream, with an extra dollop of hyperbole. The founder and chairman of Related Cos. is standing on a dilapidated branch of an ancient elevated railway, known as the High Line, that runs through the Chelsea neighborhood on the West Side of Manhattan near the Hudson River. Below him is a bleak industrial landscape -- a vast rail-yard complex packed with the trains that feed Pennsylvania Station, surrounded by a patchwork of parking lots and auto-repair shops. "This is not how New York should look!" exclaims Ross over the drone of the locomotives on a sunny morning. "We will change that. You're looking at something that will be far greater than Rockefeller Center -- that will be the new heart of New York City."


Pointing with a roll of blueprints, the master real estate developer sketches the skyline of a future city within a city by describing where landmarks will rise over the next decade. He gestures toward the site of two silver skyscrapers to come, one a new headquarters for Coach, the other reportedly set to be occupied by Time Warner. Jutting out from the Time Warner tower will be a triangular, open-air observation deck at a height of 1,053 feet that, Ross boasts, "will be a few feet higher than the deck at the Empire State Building!" The two office behemoths will bookend New York City's biggest retail mall, an ultra-luxury emporium the size of an entire city block and at least five stories tall. Its 14 restaurants will feature an exclusive menu of celebrity chefs, from Daniel Boulud to Thomas Keller, in a complex curated by master restaurateur Danny Meyer. The new metropolis, says Ross, "will display the work of more great architects in one place" than any other development anywhere in the world, showcasing the contrasting designs of luminaries such as David Childs, Robert Stern, David Rockwell, William Pedersen, and Elizabeth Diller.

只需一指蓝图, 这位巨匠级地产开发商已经能勾勒出在今后十年内市值上升的城中之城的轮廓。他指向的两个位置将会建起两座银色的摩天大楼,一座将会成为蔻驰新总部,另一座据说将会为时代华纳所用。而且时代华纳楼顶会伸出一个高度为1053英尺的三角形露天观景台,罗斯自豪地说,“那将会比帝国大厦的露天平台还要高几英尺。”在这两座办公写字楼巨兽之间会建一座纽约市最大的零售商场,那将是一个至少5层楼高并且有整块街区那么大的超豪华百货商场。同时其间将会开设14间由名厨打理的独具特色的高档餐厅,从米其林三星名厨丹尼尔•布鲁德到美国最佳厨师托马斯•凯勒,还有专门承包顶级假日派对的策划大师丹尼•迈耶。“这个新都市中心,”罗斯说,“会把更多来自于不同的伟大建筑设计师的作品汇聚在一起”这将比任何其他在世界任何地方都要多。包括重新设计世界贸易中心一号大楼的戴维•蔡尔斯,耶鲁建筑学院院长罗伯特•斯特恩,纽约酒店建筑设计师戴维•洛克威尔,KPF首席设计师威廉•佩特森以及美国先锋建筑师伊丽莎白•迪勒。

Welcome to the Hudson Yards. Put simply, it is the largest private real estate project in U.S. history -- and, in fact, worthy of most of Ross's superlatives. Related Cos., one of the world's largest private real estate developers, is both the controlling owner of the site and the developer for its planned 17 buildings. The project calls for 18 million square feet of offices, stores, apartments, hotels, a school, and even a mammoth, city-sponsored "culture shed" for fashion shows and concerts. Some 55,000 people will live or work here. Its size eclipses America's previous largest development, the 16.8- million-square-foot CityCenter in Las Vegas, and it's likely to get larger; its $20 billion estimated cost is unparalleled as well.


Related agreed to buy the rail yards from the city five years ago for $1 billion. That's the price tag for the official site, and it covers 26 acres, the equivalent of six city blocks, encompassing the entire area between 30th and 33rd streets and 10th and 12th avenues. But Related, along with its joint venture partner, the Canadian real estate giant Oxford Properties, is greatly expanding its footprint in the Hudson Yards neighborhood by purchasing adjacent parcels. Like a latter-day Robert Moses, Ross has a plan that will dramatically shift the center of gravity of America's biggest city. New York is hungry for modern, state-of-the-art office and apartment towers, and that's what the Hudson Yards will offer in a single, gigantic location. "You'll never see 26 acres again in the heart of a great city, where you can build an entirely new neighborhood totally from scratch," says Tom Barrack, CEO of Colony Capital, a $28 billion private equity firm specializing in real estate. Construction officially began late last year, and the first building is scheduled to open in 2015.



Pulling off such a colossal project in the middle of New York City won't be easy. Besides navigating the complex, 10-year construction schedule, Related must build hugely expensive infrastructure: The entire development will rise on top of six-foot -thick concrete platforms that will spread, building by building, to cover the rail yards because the trains will keep running below. The concept is actually nothing new for New York. The northern stretch of Park Avenue, the city's premier residential address, arose over sunken rail lines in the 19th century.


Fortunately for Ross, forces are coalescing to give the Hudson Yards project strong momentum. The Manhattan real estate market has rebounded from the financial crisis. And the Metropolitan Transportation Authority is spending $2.4 billion on the first major subway extension on the West Side of Manhattan in more than half a century. A new branch of the No. 7 subway line will go from Times Square to a terminus adjacent to Hudson Yards, connecting the once-isolated area to Midtown and Grand Central Terminal by mid-2014.


It all appears to be coming together for Ross, 72, a real estate titan at the top of his game. With a fortune estimated at $6 billion and a side job as the owner of the Miami Dolphins (he took a controlling interest in 2009 for a total price of $1.1 billion), Ross could have chosen to settle into a cushy, jet-setting retirement. Instead he's taking on a slate of ambitious projects around the globe. In Abu Dhabi, Related is co-developing the 280-acre Al Maryah Island complex, one of the largest real estate projects ever in the Middle East. In Brazil, Ross is building two luxury condo towers in São Paulo in partnership with his longtime pal Jorge Pérez, who founded the similarly named, Florida-based Related Group, of which Ross's Related owns a 25% share. Then there's the Grand Avenue urban-renewal project in downtown Los Angeles, where Related has begun work on a complex that will include hotels, stores, and apartments covering three city blocks. Back in New York, Related is also leading the historic rebirth of barren Willets Point, a 23-acre area in Queens around Citi Field, home to the New York Mets.


But it is Hudson Yards that will be the crowning achievement of his long career. Ross took on the project during the depths of the financial crisis. It was his vision of what could be and the force of his personality that overrode the risks of starting with no tenants or financing. And now that work has begun on the site, the lawyer-turned-developer is overseeing it with the same relentless attention to detail that he brings to all his projects. Ross granted Fortune an exclusive look into how he runs his business and described how his long career in real estate prepared him for attempting a project as outrageously ambitious as Hudson Yards.


If there's one quality that sets Ross apart from other major developers, it's his skill at orchestrating highly complex projects. He specializes in keeping all the elements in balance, planning to ensure that the inevitable downward shifts in rents and prices during a multiyear project don't derail it along the way. Ross's approach to building Related, which he founded in 1972, reflects his view that developers get in trouble not because their projects won't eventually thrive, but because they lack core financial strength and hence run out of cash in tough markets. Most developers sell their apartment buildings and retail centers once they're completed and move on to the next deal. Related's strategy is to own and manage the projects it builds.


Today Related has a $20 billion portfolio, primarily consisting of shopping malls and apartments -- lots of apartments. The company owns 5,000 mostly upscale rental apartments in 20 buildings in New York City, making it one of the Big Apple's largest landlords. And it has another 1,000 rental units in Boston, San Francisco, and Chicago. Ross got his start in affordable housing, and that market remains a bedrock for Related: The company's portfolio of 45,000 below-market-rate apartments in 19 states is among the largest in the nation. Though Related declines to disclose its free cash flow, Fortune estimates that it's several hundred million dollars a year. That big, recurring income stream gives Related a stability rare in the development world.


With such a solid financial base, Ross is willing to take huge risks on gigantic, long-term projects that spook his rivals. "He'll take it right to the edge," says Rafael Cestero, who served as New York's affordable-housing chief under Mayor Michael Bloomberg, "but he never goes over." Ross is a master at sequencing jobs so that the tenants or buyers he attracts at the start cover a big chunk of the eventual costs, even if he generates no profit from those early deals. That's the strategy at the Hudson Yards, where the office space is essentially a loss leader for the highly lucrative stores and apartments that will arrive much later.


It's a playbook that Ross has used before. He has become the biggest practitioner in the U.S. of what's called mixed-use development. Rather than specialize in apartments, retail, or office buildings, today Ross not only builds all three but also blends them into fully integrated neighborhoods that, though they're built all at once, resemble areas developed organically over decades. In his view, all three components reinforce one another, making each more valuable than it would be alone. "Most developers don't like mixed use," says Barrack. "They want to specialize. It's a much more complex exercise, but the potential profits are also much bigger."


That approach has helped make Ross perhaps the leading private figure in a real estate revolution in New York in recent years. Bloomberg's greatest accomplishment in his 12 years as New York City's mayor was to rezone large swaths of underutilized land from industrial and commercial uses, for which demand was extinct, to residential and office use. "We were accused of being too close to Ross," says former deputy mayor Dan Doctoroff, now CEO of Bloomberg LP, "but Ross was the only developer willing to step up on projects like the Hudson Yards. He was also the best at mixed use. Ross shared Bloomberg's vision of New York more than any other developer."


In his wood-paneled office on the 19th floor of the Time Warner Center in Midtown Manhattan, filled with Dolphins and University of Michigan Wolverine paraphernalia, Ross chronicles how his career divides into a series of quantum leaps to ever more daunting projects. The setting is appropriate, since the Time Warner Center was his first large-scale, mixed-use project and has proved to be a valuable training ground for Hudson Yards. There are doubters each time he takes on a new, bigger project, says Ross. "I always just say, 'We'll figure it out.' "


Ross grew up in Detroit, the son of an inventor of vending machines and fuel additives whose creations often failed to make money. As a business role model he had his uncle, Max Fisher, a Detroit gas-station magnate and local legend who would later rescue his nephew during hard times. While Ross was still in high school his family moved to Miami, where he graduated from Miami Beach Senior High School, ranked 400th in a class of 440. He managed to get admitted to the University of Michigan, class of 1962, and today is a leading benefactor of his alma mater. In 2004 he endowed the renamed Stephen M. Ross School of Business with a $100 million gift. The ringtone on his cellphone plays the Wolverines' fight song, "The Victors."


After practicing tax law for a few years in Detroit --"Being best known as Max Fisher's nephew was not the way to go through life" --Ross ventured to Wall Street, taking a job with Bear Stearns in 1970. It was clear from the start that the headstrong Ross didn't like working for anyone else. He soon clashed over a deal with a partner, who announced, "I have no confidence in Ross!" Ross shot back, "I have no confidence in you either. So go to hell!" He got fired the next day. A $10,000 loan from his mother paid for rent and meals while Ross sought to apply his expertise in tax law to development.

之后在底特律税法部门工作了几年, “鼎鼎大名的菲什尔的侄子不应该一直以这样的方式过完一生”——于是罗斯便前往华尔街寻找机会,1970年的时候在贝尔斯登得到了一份工作。当然了,刚愎自用的罗斯从一开始就并不喜欢为其他人工作。刚进公司不久他跟合作伙伴就达成协议发生了冲突,对方直言不讳地宣布,“我对跟罗斯合作一丁点儿信心都没有!”罗斯也毫不示弱地反击道,“我对你也没有一丁点儿信心!见鬼去吧!”第二天他就被炒了鱿鱼。这个时期,年轻的罗斯还在试图以他所具备的在税法专业知识在事业上大展宏图的,而租房和吃饭的费用都是从他的母亲的那一万美元贷款里开销。

He realized that specializing in affordable housing had the potential to be highly lucrative, chiefly because the tax benefits were extremely enticing to investors. His first project was a 150-unit apartment complex in Woonsocket, R.I. It's a business Ross has pursued ever since. Although affordable-housing programs vary widely, the basic formula is generally similar, and Ross mastered it. He typically raises all the construction financing from the proceeds of low-interest municipal bonds and tax credits purchased by banks and wealthy individuals. "The investors get the tax credits; the cash flow goes to the developer," explains Ross. As a result, Ross would get to own the buildings --and collect a stream of rents that varied little in good times or bad --by investing small amounts of his own cash.


By the mid-1980s, Ross had established himself as a rising star in mainstream development as well, erecting residential towers on Manhattan's Upper East Side. But near disaster struck in the real estate crash of the early 1990s. "I was worth $350 million in 1988, and by the early 1990s, I was worse than broke," recalls Ross. "I owed the banks $120 million." Confident the market would recover, Ross bought time by allowing the banks to secure their loans with his finished and unfinished buildings. His uncle Max and his friend Pérez, among others, invested a total of $15 million in exchange for equity in Related, and later cashed out for four times their investment. Ross was able to keep most of his properties.


But the near-death experience changed his thinking forever. From then on, Ross shunned the high leverage that's routine with most developers. Today he raises around half the cost of his projects in equity that Related and its partners provide. Ross also learned the wisdom of getting gobs of cash from investors when times are good.


Ross believes in finding talented people and holding on to them. During a visit to the University of Michigan in 1988, a real estate professor told Ross, "You've got to hire this kid -- he's the brightest student I've ever had." The wunderkind was Jeff Blau, who would become Ross's ace dealmaker. Proving that he had the chutzpah necessary to work with Ross, Blau, whose father was a plumbing contractor and small developer in Queens, told Ross that he needed to get back to New York for the weekend and asked for a ride in Ross's plane. "I had no reason to go back to New York," says Blau. "I just wanted time on the plane with Stephen so he'd offer me a job." When Blau joined Ross full-time in 1990, Related was doing no new projects. The development staff had shrunk from 20 to four. Blau filled the time by commuting to Philadelphia to secure an MBA from Wharton. Blau told Ross that he'd work for him for a couple of years, then start his own business. "If you're as good as you think you are, I'll find a way to keep you," Ross told him. In September of 2012, Blau, 45, replaced Ross as Related's CEO.

罗斯认为找寻到了人才就应该留住他们。在1988年访问密歇根大学的时候,一位房地产教授告诉罗斯,“你无论如何都必须雇佣这孩子——他是我有过的最聪明的学生。”而这个学生就是杰夫•布劳,后来变成了罗斯的王牌交易人。布劳的父亲是一个在皇后区专做管道和小型项目承包的开发商。后来事实也的确证明杰夫•布劳有着与罗斯共事的必要的胆识,有一次他曾告诉罗斯他需要回到纽约度周末,并且请求搭乘罗斯的专机。“其实当时我并没有理由回到纽约,”布劳表示,“我只是想争取在飞机上能与斯蒂芬先生有单独的时间共处,以说服他给我提供一份工作。” 1990年杰夫•布劳作为一个全职的正式员工加入时,罗斯并没有在做什么相关的新项目。事业发展部的人员从20减少到了4个。杰夫•布劳便趁着那段比较充裕的时间往返费城沃顿商学院学习并获得了工商管理硕士学位。布劳告诉罗斯,他愿意先为他工作几年,然后再开始自己的事业。而罗斯回答道:“如果你就像你认为的那么出色,那么我一定会找到一种方法让你留下。”到2012年9月,45岁的杰夫•布劳,正式取代罗斯成为瑞联的CEO。

Blau's tenure is a tribute to Ross's ability to keep ambitious lieutenants supremely challenged, as well as make them rich. Ross also recognizes that to keep such folks he needs to make them partners. Blau and Bruce Beal, Related's president, alone own 30% of Related, worth more than $2 billion. Unlike many New York developers, Ross -- who has two daughters from his first marriage and two stepdaughters -- has no relatives in the company.

安排布劳的接任企业管理其实是对罗斯如何能继续保持勃勃雄心以及如何让集团获利的一项极大的挑战。罗斯也意识到要想留下这样的人才是需要让他们成为合作伙伴的。布劳和瑞联的总裁布鲁斯•比伊尔,每人都拥有Raleted 30%价值超过20亿美元的份额。而与许多纽约开发商不同的是,罗斯除了他从第一次婚姻留下的两个生女以及之后两个继女之外在公司内没有亲戚。

After a series of highly successful projects in the mid-'90s, Ross and his team captured the prize that made Related a truly major player: the Time Warner Center. Mayor Rudolph Giuliani called for proposals to transform the decrepit New York Coliseum convention center at Columbus Circle into a commercial hub. Ross proposed the largest, most daring mixed-use development in Manhattan history. The plan was incredibly complex and extremely expensive. But Ross was confident he could make all the elements work together. The major innovation was the extensive use of "vertical retail" -- four levels of stores and a plaza of restaurants, operated by top chefs, on the top floor. "Almost no one thought it would work," says Ken Himmel, a mixed-use specialist who ran the retail portion of the project and is playing the same role at the Hudson Yards. The other bidders put most of the retail on the ground floor, with a heavy concentration of banks and drugstores. Vertical retail, separate stores in a multistory complex, had never worked well in Manhattan. New Yorkers preferred department stores such as Macy's and Bloomingdale's. Or they shopped at the fancy boutiques on Madison Avenue.

在90年代中期经过一系列非常成功的项目之后,罗斯和他的团队终于俘获了一位真正的重量级行业领导者:时代华纳中心。当时鲁道夫•朱利安尼市长提议将哥伦布圆环广场破旧的纽约中心大剧场改造成一个商业中心。于是罗斯提出了在当时曼哈顿的历史上最具规模而且最大胆的多功能综合开发的项目计划。这是个相当复杂而且耗资不菲的计划。但罗斯非常有自信能让所有的元素在一起和谐工作。当时他大胆的创新是广泛使用“垂直零售”—— 四个楼层的商店以及一个在顶层的由大牌厨师亲自打理的餐厅广场。“当时几乎没有人认为这是可行的,”肯希默尔说,他是多功能综合开发项目专家专门负责零售部分的工程,目前在哈德逊城市广场项目中担任同样的职务。其他参与投标的开发商都将大部分的零售店放在一楼,与密度十分集中的数家银行以及药店联在一起。而垂直零售就是将商店分布在一个多层的综合建筑内,但这种垂直零售的方式之前在曼哈顿的效果并不理想。纽约人喜欢梅西百货和布卢明代尔这样的百货商店,或者像麦迪逊大道这样的豪华精品购物街。

Ross believed his approach could work, but he felt he needed to hedge by finding a major anchor tenant for the office space. In early 1998 he wangled a five-minute slot on the schedule of Dick Parsons, the president of Time Warner (the parent of Fortune's publisher). "What do you want?" asked Parsons. "There are eight companies bidding on Columbus Circle, and they've all been here, and we don't need more space." Ross went into full promoter mode. "Dick, this isn't about space. It's about showcasing the greatest media company in the world," he said. Parsons grasped the brand value of having a trophy building, in a world-class location, named for his company. "I knew it would be an iconic place," Parsons told Fortune. "Our deal put Related on the map and transformed the West Side of Manhattan."


The Time Warner Center started slopcmsy but proved incredibly lucrative. (If it moves to Hudson Yards, Time Warner will eventually vacate its namesake building.) Boasting upscale tenants from Hugo Boss to Tourneau, as well as a base of mid-tier stores, the vast shopping plazas generate spectacular rents; sales per square foot on the ground floor approach those for the same stores on Madison Avenue. And the prestigious restaurants, including Masa Takayama's Masa and Thomas Keller's Per Se, draw crowds to the upper level, right past the display windows of Sephora and J. Crew. That success in blending diverse elements provides a template for Hudson Yards.

时代华纳中心项目开始比较缓慢,但毫无疑问是个利润丰厚的产业。(如果将它移动到哈德逊城市广场,时代华纳将最终腾出其同名的建筑。)不论是从胡戈波士还是唐龙这类高档租户,或是那些以中间消费层为主的商店,都在为这所巨大的购物广场带来数目壮观的租金。底楼的商铺每平方英尺的销售额已经赶上了开在麦迪逊大道的同家店铺。还有那些吸引上层社会消费者的顶级奢华餐厅,包括著名的高山麻纱的日式餐厅和托马斯凯勒的Per Se法国餐厅,经过展示窗也能看到里面的丝芙兰连锁店和J. Crew品牌。华纳广场完美地将各路元素融合在一起,为哈德逊城市广场项目提供了一个成功的模板。

On the surface, Ross's approach to business, and everything else, can look haphazard and improvisational. Friends variously describe Ross as loud, rough, dramatic, and "a bull in a china shop." "When he goes after something, he's like a bulldog," says Pérez. "He shows total single-mindedness. What amazes me is how he blends that with an uncanny ability to keep and grow good people." A trademark tactic is to take the opposite side of almost every argument. He'll pop into a meeting about a new building where almost everyone in the room thinks it should have three uses and argue that three is too many. Then he'll invade the same meeting the next day and argue that four uses is a better idea. "He argues the opposite to make you defend your position," says Beal, Related's president. "He actually hasn't made up his mind and wants to listen to all the arguments, from every direction."

罗斯的经营的理念以及他对其它任何事物态度表面上看起来一切都很随意和即兴。朋友们对他却有各种不同的描述,他有着大嗓门、个性粗糙又戏剧性。“他是个莽撞的人。”“看到猎物的时候他就会变得像猎犬一样死死追着不放”他的朋友佩雷斯是这么评价的,“在他身上体现了真诚率直与忠心不二。让我感到惊奇的是不知道他是有怎样一种不可思议的力量,居然能将一切看起来不协调的东西混合到一起并维持良好成长。”在公司里,几乎每一场关于商标策略的讨论他都站在大多数反对的那一边。有时他甚至会突然出现在一个关于新建筑的讨论会议中,几乎所有在场的人都认为它应该有三个用途,但是他会提出三个太多。然后第二天他又会再次闯入同一个会议并提出四个用途会更好。“他之所以站在你的对立面与你争论就是为了让你极力为你的立场辩护” 瑞联的总裁比伊尔说道,“实事上在他还没有下定决心之前也想从不同的角度听听所有的讨论和想法。”

Before the crash of 2008, Ross made two strategic gambits that fortified Related for the turbulence ahead and provided the ballast needed to secure the Hudson Yards deal. Ross had recognized the gathering storm. "I knew the world would change," he says. He remembers how his uncle Max Fisher had secured oil for his filling stations on long-term contracts during the Great Depression when supplies were plentiful. "He had a steady flow when scarcity hit later, when no one else did," recalls Ross. So Ross decided he'd take in a lot of cash while it was plentiful. In December of 2007, he sold 25% of Related for $1.4 billion to five investors: Michael Dell's MSD Capital, Goldman Sachs, the Kuwait Investment Authority, Mubadala Development of Abu Dhabi, and the Olayan Group of Saudi Arabia. He used part of the cash to buy his first stake in the Dolphins. But a large portion went to bolster Related's working capital.


When the real estate crash struck, Ross, Blau, and Beal made a second fateful decision: radically changing the business to keep staff in place. Ross announced that Related would suspend all projects not already being built. Blau's role was to find jobs that Related's people could perform to generate revenue in a bad market. "We wanted to keep all our people so they'd be ready to go when things turned around," says Blau. "We transformed our development people into workout people." For example, Related sent 100 staff members to Las Vegas to rescue the foreclosed-on, $3 billion Cosmopolitan hotel and casino. Related generated substantial fees on the project by reconfiguring it and completing construction on schedule and on budget.

在房地产市场崩盘的时期,罗斯,布劳和比伊尔做了第二个重大的决定:为了使员工留下而从根本上改变企业的业务内容。罗斯宣布,将暂停所有已经在建的项目。而布劳就负责为瑞联的人找到一个能在这个整体市场都很糟糕的情况下还能得到收入的工作。“我们想留下所有的员工,就算是在逆境的时候也想让他们能作好充足的准备去应对不得不离开的情况。”布劳回忆道,“我们让我们办公室开发部的员工变成了办事员”。 例如,当价值30亿美元丽都酒店和赌场将被没收的时候瑞联就派了100个员工到拉斯维加斯去赎。后来瑞联集团通过重新调整项目计划周转了一些运营经费,最后也在预算内完成了施工进度。

Then, in early 2008, came the opportunity to bid on Hudson Yards --and it almost eluded Ross. The rail yards had originally been picked as the site for the Olympic Stadium in New York's campaign for the 2012 Games. But after the games were awarded to London, Mayor Bloomberg pivoted and asked top developers for their visions of a metropolis-size development. Ross signed up News Corp. as an anchor tenant and thought Related was a cinch to win. However, in March 2008, Bear Stearns collapsed, signaling the larger crisis to come. News Corp. withdrew the day before the final bids were due. Related effectively folded, and the city chose Tishman Speyer. Ross was disconsolate. Within days he was telling anyone who would listen that he shouldn't have been so cautious and rational and should have stayed in the race, even without an anchor tenant. "When Stephen lost the first time, he went through an unspeakable litany," says Marty Edelman, a real estate attorney with Paul Hastings and a longtime friend of Ross's. "He kicked everybody and anybody for everything. No one escaped except the doorman --until he finally settled on blaming himself."


Miraculously, he got another chance: In late May 2008, Tishman Speyer suddenly dropped out. The city, desperate to get started, offered the deal to the previous bidders. Only Related stepped forward. However, in negotiations with the city and the MTA, which owned the site, Blau insisted on a major change to the terms. The Tishman Speyer deal had called for the developer to go to contract -- essentially commit to buying the land -- in four months and start making big payments two years later, in late 2010. Blau and Ross decided that in this dire market, they needed far more time. If they couldn't find tenants for several years, they'd be forced to make the large payments to the city without any income. The MTA agreed to charge no rent for five years after the closing.


But Ross remained nervous. He still feared that the payments could start long before the project generated any real income. Ross hatched a brainstorm that saved the day. He proposed that the closing be contingent on achieving three "triggers," or benchmarks, that, once reached, indicated a strong revival in real estate. They included measures based on residential prices and construction activity. The triggers were conceived by Ross as a strategy to buy time, since all three had to hit before Related could be forced to close on the land. Ross was essentially getting an option on the Hudson Yards. It was a wise move. "Even by early 2012, there wasn't a tenant to be found," says Blau. But then the market turned. In a major coup Related signed Coach as anchor tenant in its first tower. From that point on, the deal wasn't in doubt. Related officially closed on the land in April 2013, after investing $300 million in planning, deposits with the MTA, and foundation work.


By dangling the promise of thousands of union jobs, Ross and Blau were able to negotiate crucial cost concessions from New York's construction unions. It was those concessions that enabled Related to offer Coach, Time Warner, and the other early tenants great deals for taking most of the space in the first two towers. Ross acknopcmsedges that he's breaking even at best on the early office deals and will generate slim margins from the tenants who are signing on, at higher rates, right now. All told, however, the Hudson Yards should prove highly profitable for Related because the big money is in retail and residential, and residential alone constitutes about half the project. Today condo and rental buildings in Manhattan sell for almost $3,000 per square foot, more than twice what office buildings fetch by the same measure. Related's edge is the low, and frozen, cost of land, even adding the high expense of installing platforms. "When residential prices rise, so do land costs, which takes away most of the profit," says Blau. "But we've locked in our land costs over many years. They can't be bid up." So Related will benefit hugely from future gains in prices.