On June 27, 2017, a global ransomware attack affected computers in the U.S., Europe, India, Russia, and the Ukraine, similar to a computer virus known as Petya or Petrwrap, but more intense than the May cyberattack that impacted 150 nations with the ransomware WannaCry. Bill Wright, senior policy counsel for the cybersecurity firm Symantec, explains that “[o]nce you unleash something that propagates in this manner it is impossible to control.” And companies could not control the attack as DLA Piper lawyers showed up to work early Tuesday only to see a sign stating: “All network services are down, do not turn on your computers! No exceptions.”
The hackers used methods stolen from the National Security Agency and targeted major companies, law firms, financial institutions, and hospitals. Including: the pharmaceutical firm Merck & Co., Russia’s leading oil producer Rosneft, Britain’s WPP (the largest advertising agency), Deutsche Post’s Ukraine division, law firm DLA Piper, the Russian central bank, multiple Ukrainian banks, and hospital chain Heritage Valley Health System. The hackers encrypted some of the world’s most sensitive information and demanded a payment of $300 in Bitcoin (roughly $777,700 USD) as consideration for the decryption code. According to the American Lawyer and blockchain records, 27 organizations have paid the ransom. Perhaps if these companies kept their information secure using blockchain technology, they would not have run into this problem in the first place since there is no centralized source with blockchain, making it virtually impossible to hack.
Between this week’s global malware outbreak, the attacks on Weil Gotshal & Manges and Cravath, Swaine & Moore last March, and the leak of the “Panama Papers” from Mossack Fonesca, law firms more than ever have an incentive to adapt their measures, technology and policies to safeguard client information. How can firms protect themselves for a major breach of security? Establish and maintain an enterprise security system to protect all electronic documents and conduct and document regular risk assessments. Installing and implementing thorough and precise cybersecurity measures, technology, and policies is essential. These practices will mitigate malware risks, provide procedures on how to locate and eliminate the virus, and attract future clients. These policies however need to be monitored not just by IT, but by the attorneys and support staff. In case of a cybersecurity attack, it is helpful to have an off-site back-up server that is frequently maintained to re-install any lost information. Firms should have cybersecurity insurance to cover the ransom, forensic investigator contracts, and legal expenses related to the malware attack.
Furthermore, law firms should also have in place malpractice insurance policies that protect against cybersecurity liability in case privileged or otherwise confidential client information is released due to the malware. Attorneys can be held liable under professional negligence such as in the case Millard v. Doran No. 153262/2016, where a real-estate attorney who used AOL email for her legal practice was liable for professional negligence for not implementing any cybersecurity protection measures and for using a server that was “notoriously vulnerable” to hackers.
Law firms with clients in the financial or health sector are subjected to further cybersecurity regulations. Pursuant to 23 NY CRR 500.03 and 500.01(n), (d), (g) and 500.11(b), the New York Department of Financial Services requires financial institutions to comply with cybersecurity regulations, which includes assessing their law firms’ (who fall within the ambit of Third Party Service Providers) cybersecurity measures and ensure law firms do not misuse nonpublic information. FINRA regulates broker-dealer firms in regards to cybersecurity as well. However, these regulations transfer to broker-dealer’s law firms if the firm is negligent in monitoring the client’s security practices. In regards to any client matters relating to health, data protection is covered in the HIPAA Data Security Regulations and the HIPAA Privacy Regulations. Law firms here fall within the ambit of “business associates” and are directly liable under HIPAA for any data breaches.
For firms that are located in both the U.S. and EU, it is imperative to understand the different regulations in each jurisdiction. The European Union has implemented the Data Protection Regulation for all Member States, which will be in effect on May 25, 2018. This Regulation requires law firms to notify clients in the event of a data breach.
Click here for a regulation implementation timeline.
Is it possible to avoid unwanted guests in your co-op or condo unit? Not if the unwanted your guests are your landlord, superintendent or other agents of the building. New York State’s Multiple Dwelling Law requires tenants to supply a duplicate key to their landlord for inspections and repairs, which co-op shareholders generally are also subject to under a proprietary lease. Section 51-C of the Law permits tenants to install a second lock separate from the one maintained by the landlord, however, the landlord or their agent may request a duplicate key for this lock.
When determining whether you need to leave a spare key, check the by-laws, house rules, and for co-ops the proprietary lease. In most cases a duplicate key will need to be available in case of an emergency, which the landlord or another agent of the building is permitted to use without giving any notice. The landlord or other authorized persons may also use the key for an appropriate reason with at least 24 hours’ written notice for inspections and one weeks’ notice for repairs. Residents frequently ask whether the board is able to demand a duplicate key and just enter your property whenever they deem necessary. Larry Vitelli, the director of operations for a Manhattan property management and real estate company says that “in most cases the justification for entering an apartment in a tenant’s absence falls somewhere between willy-nilly and emergency.”
How the keys to your co-op or condo are stored depend on the building management. Some buildings have keys hanging next to the doorman; others have locked boxes or even electronic systems such as KeyLink, which is an electronically locked drawer that sends out email notifications to the unit owner when someone takes a key out. One of the most prominent concerns for individuals living in a co-op or condo is security. Typically, people do not want to leave their keys in a place that is made available to anyone in the building. However, living in a co-op or condo requires certain sacrifices not made by single, private homeowners. For instance, a gas or water leak in your unit affects not only your unit but your neighbors as well. “You should have a right to privacy, but you don’t have the right to impede emergency repairs to a building.”
In the past, cases dealing with whether you must duplicate a key are usually resolved in favor of the landlord. In 111 Tenants Corporation v. Stromberg, 168 Misc.2d 1014 (1996), a co-op shareholder felt unsafe on her own and did not want the superintendent to have a copy of her key or have any access into her unit. The Civil Court ordered the shareholder to provide a spare key, as required by the proprietary lease, and if she refused, her proprietary lease would be terminated.
Co-op and condo boards can help make shareholders and owners feel safer if they provide greater security for key access. There are a number of electronic devices that allow only authorized persons from taking keys and they send electronic key tracking to the shareholder or owner. KeyWatcher and KeyBank by Morse Watchmans are electronic key cabinets that make it easy for buildings to secure, keep track of keys, and have them readily available for authorized personnel.
Regardless of whether your building uses an old key cabinet or has invested in greater security measures, it is important that the co-op or condo board provide a written security policy that meets the demands of both the board and the residents. The policy should include provisions such as who has authorized access, how and where can you obtain your duplicate key, and what are the steps to take when the duplicate key is lost.
West 57th Street, along the southern end of Central Park, is often referred to as “Billionaires’ Row”. Among the lineup of luxury residential buildings that grace the street, two of the most revolutionary were built by Gary Barnett’s Extell Development Company, and both are in the news this week.
Extell has a history of pushing the envelope when it comes both to luxury and price, as can be seen in One57. This building currently holds the record for most expensive full-floor unit sold in New York, at $100.5 million. Unfortunately, One57 finds itself in the news due to another record it recently broke: the city’s largest residential foreclosure. Apartment 79, a penthouse that sold for $50.9 million, will be up for auction on July 19 by Luxembourg’s bank, Banque Havilland SA, after the purchaser One57 79, Inc. defaulted on a $35.3 million loan. This is the second foreclosure at One57 this month. Indeed, the two foreclosures at One57 are the only two in Billionaires’ Row history. Experts see this as a sign of the changing market. The U.S. Treasury Department has stepped up monitoring of high-end purchases to detect and deter money laundering schemes and other illegal practices. Furthermore, China is increasing regulations on capital outflow, and Brexit has caused financial insecurity in various parts of the world. All of this together reduces the demand for super-luxury residences such as these, for better or worse.
In this most recent foreclosure, at least, Extell may have come out ahead in the long run. The Real Deal has just learned the identity of the person behind One57 79, Inc.: Nigerian oil baron and international money-launderer Kolawole Aluko. Aluko is currently on the run from Nigerian authorities on board his 213-foot yacht, somewhere out at sea.
Elsewhere on Billionaires’ Row, construction is underway on Central Park Tower, which is set to be the second-tallest tower in the United States at 1,550 feet (the first-tallest, of course, being the Freedom Tower at 1,776 feet). Barnett came under scrutiny when he announced his plans for this building. Some critics doubted he could raise adequate funds, others questioned the wisdom of this venture in the current market. Indeed, due to funding constraints and various other problems, plans for this building had to be reworked several times. However, Extell defied all speculation, and now the building is under construction.
Designs for Central Park Tower were drawn up by Adrian Smith + Gordon Gill Architecture, the company currently working on the Jeddah Tower in Saudi Arabia, which will be the world’s tallest building upon completion in 2020. Funding for Central Park Tower is coming from many sources: $168 million from EB-5 visas, (which we have discussed in this blog previously), $300 million from Shanghai Municipal Investment and $426 million from Nordstrom, which will occupy the first seven floors of retail space. Most recently, and to the surprise of many real estate insiders, Extell obtained a loan of $900 million from JPMorgan Chase. A full sellout of the building’s 179 apartments is expected to bring in over $4 billion, making this the most expensive residential building in New York City history – another record.
“To our understanding, hedge fund activism stands for minority investments in undervalued or poorly managed public companies by one or several investors, investment partnerships or activist funds based on strategic objectives and tactical measures carefully formulated in advance”
Guzov, LLC’s Ami de Chapeaurouge’s new paper, published in the Hong Kong Lawyer in both English and Chinese, examines shareholder activists’ demands and hedge fund activism in Hong Kong and Germany. De Chapeaurouge tackles empirical studies to illustrate the commonalities and dissimilarities between Hong Kong with China and Germany with Europe, and examines the behavior of shareholders and controllers in blockholder-influenced companies.
Germany and Hong Kong have strong and powerful economies, but are in need of greater shareholder and hedge fund activism, particularly in these controlled companies. A controlling shareholder justifies their superior position with their business skills, however, many of these controllers are handed their position through nepotism. Activists aim to enhance company value, monitor governance, and improve company efficiency, which is imperative for a healthy, competitive free market.
De Chapeaurouge’s analysis demonstrates the similarities between the two jurisdictions’ corporate cultures, which leads to similar shareholder activist tactics and behavior in Hong Kong and Germany. Read his new published article to gain a greater understanding of shareholder and hedge fund activism in these countries compared to the U.S. and U.K. Access the article here.
This article is Part I of three installments. The next installment will be published in July.
On Wednesday, June 21, 2017, the U.S. Court of Appeals for the Second Circuit set a new standard in Stadnick v. Vivint Solar, Inc., et al., No. 16-65 when determining whether to disclose interim financial information to investors in the prospectus. The Second Circuit fundamentally departed from the First Circuit’s standard in regards to disclosure in Shaw v. Digital Equipment, 82 F.3d 1194 (1st Cir. 1996).
Robby Shawn Stadnick brought a suit against Vivint Solar, Inc. (a solar energy unit installer) and its underwriters for violations of Sections 11 and 15 of the Securities and Exchange Act of 1933. Stadnick argued that Vivint misled investors by not disclosing their third-quarter financial losses of $40.8 million in the prospectus for the initial public offering. Stadnick additionally alleged that Vivint misled prospective shareholders by not disclosing the regulatory changes in Hawaii and how that could affect the company’s revenue. Stadnick relied on the First Circuit’s decision in Shaw, whereby there is a requirement to disclose information to investors when there is an “extreme departure” from previous quarters, which was the case for Stadnick. Vivint did follow SEC procedure by disclosing financial statements less than 135 days old, but they did not include the last minute loss, which is required under the First Circuit’s standard.
Justice Walker asserted that the “test of Shaw is not the law of [the Second] Circuit” and instead followed the test in DeMaria v. Andersen, 318 F.3d 170 (2d Cir. 2003) (Main Opinion, per Justice Walker p.4). In DeMaria, the Second Circuit explained that a duty to disclose interim financial information in the prospectus arises when “a substantial likelihood that the disclosure of the omitted [information] would have been viewed by the reasonable investor as having significantly altered the ‘total mix’ of information made available” (Justice Walker p.180, per TSC Indus, Inc. v. Northway, Inc., 426 U.S. 438, 449, (1976)).
Due to Vivint’s Hypothetical Liquidation at Book Value (HLBV) method and business model whereby the shareholders income varies each quarter depending on “(1) contributions by investors and (2) transfers of title to the funds that provided the requisite capital”, the measurement of the metrics do not fall under the standard of Shaw (Stadnick, per Justice Walker, p.7). Therefore, the Court concluded that this instance was not a case of “extreme departure” because using this metric does not provide a clear indication of Vivint’s performance. The registration statement of the third-quarter was “consistent with a pattern of fluctuation that began with the first quarter” and a reasonable investor “would not have harbored any solid expectations based on prior performance” especially since Vivint warned investors of such fluctuations (Stadnick, Justice Walker, pp.18-9). In regards to Stadnick’s claims against Vivint for misleading investors about the regulatory changes in Hawaii, the Second Circuit agreed that Vivint provided sufficient warnings in the registration statement that the business was “vulnerable to changing regulations” (Stadnick, Justice Walker, p.21). The Court ultimately confirmed the dismissal of the claims brought pursuant to Sections 11 and 15.
How does this decision alter the behaviors of public companies? Companies need to ensure that they disclose material information and assess when they have a duty to disclose interim financial information. It is important to make sure the metrics are consistent with previous quarters, and when there is an “extreme departure” (not necessarily in the sense of Shaw), that the information is disclosed in the prospectus.
In 1881, Philip Hubert (architect and entrepreneur), Jared Flagg (clergyman and painter), and James W. Prisson (designer) brought the co-op concept to New York’s Rembrandt building, “so named because it was aimed in part at artists, who were presumed to be more accepting of the unconventional.” The concept was to allow tenants to cooperatively make decisions for the building and expenses on their own. The developers however, sought to “control” who moved into the building, permitting only “people of means and good social standing.” However, the Rembrandt co-op did not survive for long as in 1903, Andrew Carnegie purchased the building. Perhaps its failure was due to a lack of modern by-laws.
Co-ops are directed by two main governing documents: the proprietary lease and the by-laws. The by-laws are a set of governing rules created by the corporation that shareholders are bound to. The by-laws establish what you can and cannot do as a shareholder or board director, how you vote, appoint new board members, pay maintenance fees and flip taxes, assign your lease and most importantly, how to amend your by-laws to keep up with modern times. However, many New York co-ops’ by-laws were written in the 1980s and are not always consistent with modern legal practices and technology – nor are they in layman’s terms. Commentators argue that the by-laws “were never intended to be permanent” – they should be regularly updated to meet the demands of the shareholder-tenants.
Every building’s by-laws differ in regards to the procedure of amending the provisions. Some cooperatives require either a shareholder or board of directors to vote in the affirmative of two-thirds, seventy-five percent, or a super-majority to amend, alter, repeal or create new by-laws, and some co-ops may permit both to vote depending on the provision. For a shareholder vote, generally the shareholders who own a majority of the corporation’s shares must hold and attend the meeting to form a quorum, and depending on the by-laws, vote either in person or by proxy. If a quorum is not present at the meeting, the holders of a majority of the shares can adjourn the meeting to another date at which time the shareholders present at the original meeting are entitled to vote regardless of a quorum.
Generally the by-laws require all board members to attend the meetings in order to adopt a resolution. However, this cumbersome and sometimes inconvenient rule has been offset by New York’s Business Corporation Law §708, which permits board members to either all give written consent to adopt a resolution without the need of attendance or participate via telephone conference or another device allowing everyone to hear each other at the same time, such as Skype (unless restricted by the by-laws or certificate of incorporation). Amending the by-laws to make the procedure of voting more efficient and adaptable will carry many benefits.
The indemnification provisions are one of the most important to be updated since board directors or officers can be held liable for certain acts or omissions when acting within their capacity. In 1988 New York’s Business Corporation Law §722 – 726 was amended to permit corporations to indemnify directors if the by-laws reflected the provisions of the new law. It is imperative to amend your by-laws to mirror the language of the Business Corporation Law.
Another common issue that arises is whether shareholders are permitted to sublet their apartment. Some co-ops will impose sublet fees to cover any expenses. Regardless of whether the provisions provide for a fix fee or reasonable fee, the courts will not require a payment that is too excessive. If a co-op does impose these fees, it is imperative that they are reflected in the by-laws and the proprietary lease in clear and concise language. In Zimiles v. Hotel des Artistes, Inc. 216 A.D.2d 45, the New York Supreme Court held that because the proprietary lease or the by-laws lacked specific provisions regarding the sublet surcharge, it was void. The co-op was ordered to return over $300,000 in sublet fees and the shareholders were granted attorney’s fees.
On Thursday, June 15, a new entrance to Penn Station opened its doors. A single new entrance may not seem like a big deal, especially since it opened on a Thursday of all days. However, this one underwhelming event signals the beginning of the end for Penn Station’s numerous transit troubles in recent months.
The doors that opened Thursday lead from the Eighth Avenue façade of the James A. Farley Post Office down into Penn Station’s redesigned West End Concourse, which now sparkles with new video monitors, bold colors, and an LED ceiling made to look like the sky. The remodeling of Penn Station and the annexation of certain parts of the Farley Post Office are part of a larger project slated to encompass 700,000 square-feet of retail space and a new 255,000 square-foot train hall. The repurposed post office will be known as the Daniel Patrick Moynihan Station, and the two stations together are tentatively being called the Empire Station Complex.
Preparations began in September of last year, when Governor Cuomo contracted with Related Companies, Vornado Realty Trust and Skanska to manage this project. The governor and the development companies settled on a price tag of $1.6 billion dollars, $630 million of which will come from the developers, $550 million from Empire State Development, and the remaining $420 from Amtrak, the Port Authority, and the MTA, as well as other state and federal sources.
Critics of the Station conversion point to several questionable decisions made by the governor in commissioning this project. First, the Municipal Art Society and the Regional Plan Association (among others) have argued the governor’s plan does not go far enough to fix the congestion of Penn Station. Their solution: move Madison Square Garden elsewhere. Other critics have called it unwise for Governor Cuomo to commence this project during the current transit crisis. Amtrak is already devoting extensive money and resources to repairs – they cannot afford even more costs, or to close down any additional tracks. Likewise, the MTA’s money is better apportioned to improving New York’s decrepit subway infrastructure. Finally, the Village Voice has criticized Governor Cuomo for using taxpayer money to build what is essentially a 700,000 square-foot mall. Sure, Penn Station may suffer in the short-term, but the governor and his team are hopeful. Governor Cuomo has called this a new “iconic civic space for Manhattan’s West Side” that will “result in the creation of thousands of new construction and permanent jobs….”
There may be something underwhelming about the current image of the Empire Station Complex: one lonely doorway. But development is not stopping. Next, the Long Island Railroad Concourse may be renovated, then it may be the new Train Hall. Pretty soon, Penn Station will no longer be an urban dungeon, and the Farley Post Office will facilitate the fast and efficient delivery of millions of New Yorkers to their destinations around the country.
Last week we discussed Local Law 84 that requires New York buildings that are larger than 50,000 square feet to annually measure and report their energy and water consumption in an effort to reduce greenhouse emissions by 80% in New York City, and whether to require buildings to publicize to residents, buyers, and brokers a letter grade for the building’s energy efficiency. Now we are switching our focus – what can owners, shareholders, and tenants do to limit the emissions coming from your building?
Society needs a shift to ensure that housing is both environmentally responsible and economically efficient – sustainable for the future. Ideally, co-ops and condos will produce more energy than they use by slowly eradicating the reliance on fossil fuels and incorporating new technology such as photovoltaic cells or photosynthetic layers on the outer surface of buildings, roofs, and windows. Photovoltaic cells produce an electric current when subjected to different light strengths, which produces energy, whereas a photosynthetic layer will act as a large leaf during photosynthesis, absorbing energy to maintain the energy needs of the building. This energy would then convert into everyday household uses, such as heating water, generating electricity, and even charging electric cars. Tesla even produces durable solar roofs using invisible solar cells. Co-ops and condos can implement these sleek tiles on their roofs to create energy absorbing buildings.
Since over half of the electricity used in the U.S. derives from coal power plants, it is crucial to utilize other sources for energy production. In New York, developers have placed wind turbines on top of luxury apartment buildings, co-ops and condos. Ron Moelis, the principal of L&M Development, forecasted that “tenants would be drawn to something different” referring to the three wind turbines that sit on Pearson Court Square in Long Island City. The turbines provide 12 kilowatts of power which provide lighting in the lobby, hallways, gym and roof. L&M is known for its ecological commitment as they “use solar panels, insulated glass, and super-efficient boilers”.
Architects for the past few years have looked for innovative ways to design homes that are ecologically sound. Innovators have introduced “cement that would absorb carbon dioxide” and created “special surfaces on the [building that] would capture condensation for water use”, and “self-healing paints that contain microscopic capsules of color” to repair any damage. It is important to be mindful of the materials used in your building; avoid heavy metals and use “low-chemical-emitting paints and carpets” and other non-toxic household products.
Cars also play a large role in polluting the City. Over the past few years, hybrids and electric cars have become more affordable and accessible. Governor Andrew M. Cuomo implemented a $70 million electric car rebate and outreach initiative which offers rebates up to $2,000 for individuals buying hybrids, electric or hydrogen fueled cars. This will help New York “reduce greenhouse gas emission by 40 percent by 2030.”
The U.S. Supreme Court unanimously issued a decision on May 22, 2017 in TC Heartland LLC v. Kraft Food Group Bands LLC, No. 16-341 to clarify patent litigation venues. Kraft (Respondent) filed a patent infringement suit against TC Heartland (Petitioner) for allegedly infringing one of their patents for flavored water mixes. The issue regarding patent venues arose when Petitioner moved to either dismiss the case or change the venue from Delaware to Indiana because Petitioner’s headquarters are in Indiana and the company is organized under Indiana law, whereby Respondent is organized under Delaware law but primarily works out of Illinois.
Why has the location of patent litigations become such a problem? For the past 27 years, patent holders have primarily filed cases in only select jurisdictions (which they do not necessarily have a connection with), in hopes of a favorable outcome. The New York Times reports that over 40 percent of patent lawsuits are filed in East Texas federal courts, and one judge in particular in Marshall, Texas has heard over one quarter of U.S. patent cases. The benefit? Fairly consistent verdicts. The point of contention in TC Heartland is whether the meaning of “resides” in the patent venue statute, 28 U.S.C. §1400(b) should be construed narrowly or broadly.
The Supreme Court re-affirmed an earlier decision in Fourco Glass Co. v. Transmirra Products Corp., 353 U.S. 222 (1957), that “reside” in the patent venue statute §1400(b) should be interpreted to mean that “a domestic corporation “resides” only in its State of incorporation” as opposed to “the broader definition of corporate “residence” contained in the general venue statute, 28 U.S.C. § 1391(c).” (Justice Thomas, Opinion of the Court, p.1). Bob Stoll, former Commissioner for Patents, USPTO, explains the decision is twofold: the venue now depends on “where the defendant: (1) resides which now means where the defendant is incorporated and, (2) where the defendant has committed acts of infringement and has a regular established place of business.”
In light of the Supreme Court’s decision last month, the pharmaceutical industry worries that this will disrupt Hatch-Waxman cases. The Hatch-Waxman Act, officially known as the Drug Price Competition and Patent Term Restoration Act (Public Law 98-417), is a 1984 federal law that encourages greater manufacturing of generic drugs by easing their access into the market. The law permits generic drug manufacturers to submit an Abbreviated New Drug Application (ANDA) to demonstrate the new drug’s biosimilarity to the original drug (with an expired patent) as opposed to going through the lengthy and expensive process with the U.S. Food and Drug Administration. However, if a generic manufacturer infringes on a company’s patent for a drug, the FDA will delay approval of the application for 30 months.
Many generic manufacturers are incorporated in Delaware and New Jersey, where they are familiar with the judges and court rules. For all generic manufacturers not located in jurisdictions that are accustomed to these Hatch-Waxman cases, it would be too costly and time consuming to contest a venue for an infringement suit. The issue that will arise is that inexperienced courts in multi-jurisdictions run the risk of creating a string of inconsistent verdicts.
Male. Twenty-seven years old. Likes cooking and indie music. We’re used to seeing statements like this on dating websites. However, if you are searching for a place to live in New York City, you might find yourself posting similar things on sites such as Craigslist or Symbi. In a previous blog, we talked about co-working spaces in residential developments. But when rents are high and space is scarce, development companies realize that young (and not-so-young) people often must not only co-work, but co-live.
Living with roommates has long been a necessity for certain subsects of New York City’s population. However, such arrangements are not always easy to maneuver. Two- and three-bedroom rentals are often designed for one person or family that can afford them. Renting an entire living space can be awkward for cohabitating strangers, and can strain building amenities. Finally, subleasing by the room presents the potential for zoning violations.
Fortunately for house-hunters, developers are taking notice of these complications, and are now designing (or redesigning) residences with co-living in mind. Common, a startup that now operates seven buildings in New York City, has devoted a large portion of each property to single room occupancy. WeLive, a branch of the co-working company WeWork, recently renovated a property on Wall Street to accommodate co-living in a variety of styles.
But perhaps no company is more focused on co-living than Stage 3 Properties. Stage 3 owns Ollie, a co-living brand given to its new initiative of micro-apartments. These micro-apartments consist of a modest central space with the focus being on larger personal bedrooms. The bedrooms come pre-outfitted with a couch that converts into a bed, a smart television, a small workspace, ample storage, and sound-proofed walls. The Ollie brand currently covers two buildings in New York City: Carmel Place in Manhattan (developed by nArchitects and Monadnock) and the yet-unfinished 29-26 Northern Boulevard in Long Island City (developed by Simon Baron). Stage 3 also operates Bedvetter, still in beta, a roommate-searching website like those mentioned above, but with a focus on co-living.
However, as with many trends born of necessity, co-living is turning into a fashion statement. Take, for example, Pure House, a converted room-rental in Williamsburg, Brooklyn designed to attract young socialites who have plenty of money and little desire for personal space. Pure House offers residents access to community amenities such as spiritual meditation, masseuses, and group cookouts for as much as $4,000 per room.
Pure House is not the only purveyor of premium dorms. Indeed, all the companies mentioned above advertise lower cost living while selling single rooms only marginally cheaper than the price of a typical Manhattan studio. However, the developers mentioned above attest that it is not about cheaper accommodations – at least not exclusively. Sure, New York City is an expensive place to live, but it is also a lonely place if you do not have friends who also like, say, cooking and indie music.