As Aby Rosen was dog-sledding in Norway, skiing in Japan and snorkeling in St. Barts last month, one thought was constantly on the mind of the real estate tycoon and art collector: The building.
“We were on holiday for two weeks, and every day he was talking about the Chrysler,” said Alberto Mugrabi, Rosen’s friend of almost 20 years.
The Chrysler Building, its shining spire and eagle gargoyles among the most recognizable symbols on Manhattan’s skyline, is the latest jewel in Rosen’s real estate empire. His RFR Holding bought the 1930 landmark office tower for $151 million. While the price was a discount of about 80 percent from the previous sale, an expensive ground lease brings rising costs, the same issue that got RFR in trouble before.
“The Chrysler Building is one of the finest and most recognizable New York City architectural assets — I only invest in quality and take on the responsibility to rehabilitate and maintain these cultural gems,” Rosen said. “As far as the land lease, you work things out.”
As much as any of RFR’s properties, it lies at the intersection of Rosen’s dual careers in art and real estate. The building evokes the grandeur of the Gilded Age with its marble lobby, Edward Trumbull ceiling mural and the intricate, wood-inlaid doors of its 32 elevators.
At RFR, the Chrysler Building joins a portfolio of more than 75 office, hotel, retail and residential properties in the U.S., Germany and Israel. Its New York investments include two modernist icons on Park Avenue, the Seagram Building and Lever House.
Rosen, 58, has so far said little about his plans for the building. He plans to bring back the Cloud Club, the venue that occupied Chrysler’s 66th to 68th floors from its opening until 1979, operating as a speakeasy during prohibition. He also plans to expand and improve amenities for the public and tenants on the arcade level, including restaurants, hair salons and shoeshine shops. He had earlier considered bringing in a hotel, but has subsequently dropped that idea, he said.
“Aby’s genius is that he can pick these amazing, iconic buildings that were falling apart, and he brings them back to their original state,” Mugrabi said. “He sees these buildings like works of art.”
The Chrysler Building’s days as a premiere office location have likely passed, as more modern buildings in midtown Manhattan and on the west side at Hudson Yards draw tenants seeking updated technology and amenities.
The property’s aging interior was one reason Rosen’s RFR and Austrian real estate firm Signa Holding got it at a steep discount to the $800 million that the Abu Dhabi Investment Council paid in 2008 for a 90 percent stake in the 77-story tower near Grand Central Terminal.
The land under the Chrysler Building is owned by Cooper Union, which last year raised the annual fee to $32.5 million from $7.75 million, and has more increases planned, according to the school’s financial statements.
Ground leases have spelled trouble in the past for RFR. In 2015, the developer defaulted on a loan for Lever House, another landmark Manhattan skyscraper that’s subject to increasing land rents. The debt sold earlier this year for a significant loss, according to mortgage data firm Trepp.
Real estate and art are in Rosen’s blood, who was born in Frankfurt, the son of Holocaust survivors. His late father went on to become a developer; his mother is a painter. Rosen moved to New York in 1987. Four years later, while the property market slumped, he teamed up with childhood friend Michael Fuchs to form RFR.
A savvy collector with more than 1,000 works, Rosen uses paintings and sculptures by blue-chip artists throughout his buildings to enhance their value and maximize returns.
At Lever House, the glass-ensconced lobby has an art program overseen by Rosen and Mugrabi, a collector and private art dealer. Over the past two decades, it has exhibited works by more than 40 contemporary artists. Damien Hirst filled the space with pickled animals in glass vitrines. Barbara Kruger wrapped its walls and floor in massive black and white texts.
“We commission the artist to do a site-specific installation, and then we buy the art and we own it,” Rosen said. “So there’s cool shows, we’ve got beautiful shows, we store them, we show them, we rotate them to other museums, and we send them overseas. I’ve gotten a lot of pleasure out of it. Alberto gets a lot of pleasure out of it.”