Darcy: [00:00:00] I wanted to bring the institutions back to wanting to buy office in New York City. I think that they're being a little slow on the trigger, and that may be because the stock market has performed so well and you know, you have infrastructure as a whole another very, that class has really moved up dramatically and they all wanna be in data centers.

But this is an excellent investment vehicle and I think it's something they need to be looking at now. 

Nancy: Hello, and thanks for tuning into Real Estate Capital. I'm your host, Nancy Lashine of Park Madison Partners. Capital is a lifeblood of the real estate industry, but the decisions on where and how it's allocated are driven by people and personalities.

Who are they? What motivates them? What can we learn from their experiences? On this show, we introduce you to some of the real estate industry's most influential thought leaders and decision makers, and we talk about what is important to them, how they [00:01:00] make critical decisions, who has influenced them, and a lot more.

Our guest on today's episode is Darcy Stacom. Darcy is one of the most recognized names in commercial real estate brokerage in New York City. Over the course of her 40 plus year career, she has facilitated over $150 billion in transaction volume. Her sales have included well-known New York City landmarks, such as the GM building, the Chrysler Building 30 Rockefeller Plaza, and the $5.4 billion sale of Stuyvesant Town Peter Cooper Village, the largest. Single residential transaction in history.

Her accomplishments have earned her the nickname Skyscraper. Queen Darcy started her real estate career at Cushman and Wakefield in the early 1980s where she worked for 20 years. She left to join CBRE in 2002, where she served as chairman and head of the New York Capital Markets group for 22 [00:02:00] years.

She consistently. Ranked in the top 1% of CBRE brokers in the Americas, and ranked as the firm's top investment sales professional by annual volume eight times. In this episode, we discuss Darcy's career progression, the challenges she's overcome, mistakes made, lessons learned, and how she navigated her rise to the top, and what still is a male dominated industry in the most competitive market in the country, New York City.

Darcy recently left CBRE to start her own firm with partner Wendy Silverstein. So we also talk about the new firm StacomSilverstein, and what Darcy hopes to accomplish during this next chapter of her career. After many years of hearing about Darcy in countless media articles, it was fascinating to speak to her directly and get her account firsthand.

I know you'll enjoy hearing it from her as well.

Thank you, Darcy. [00:03:00] I'm really, really honored that you've agreed to come join the podcast today. I've heard your name for so long, we've not really had the chance to get to know each other until doing this. And I'm so excited to have you here. So welcome. 

Darcy: Thank you. And I'm excited to join you, Nancy, because I've heard so much about you and you play such an important role for us in capital markets.

So it's actually really fun to be here. 

Nancy: Well, that's very generous of you to say thank you. You know, you have more titles given by the media than I think anybody I know, but, skyscraper queen, you were, you were a chairman, chairman of CBRE capital markets before, like when there were no women chairman and you've had just an incredible career, kind of being at the top of the heap in New York through the nineties and the Augh.

In the most competitive market, not just in the country, in the world. Clearly a man's world. [00:04:00] And, Darcy Stacom kept getting her share of listings and big deals like the GM building, which, I guess, what was that, 2.8 billion? And of course, GM building was close to my heart because my first job in real estate private equity was because I saw the GM building on the cover of, I think it was the New York Times when, CPI bought it.

And that's how I learned about Jerry O'Connor and he was my first mentor in the business and I went to go work for him. Interesting. But that's how I learned about the structure of the deal. It was the front page of the New York Times, but, then you did the 5.4 billion sale of Peter Cooper Stuyvesant Town.

I grew up in Peter Cooper. Fun fact. Yeah.And so many other deals. So, um. Uh, you know, I guess let's just start out by, okay, so you, you were at the top of the heap in a man's world. How the heck did you do that? 

Darcy: It's a, [00:05:00] it was a long road, obviously. They always are. And I think the first thing I did is I never really paid attention to any rules, and I didn't look at it as, it's a man's world, you're a woman trying to enter it. I just tried to carve out something that was different and cause people to want me in the room. Mm-hmm. And I realized quickly that thing was better research and a better understanding of the dynamics of what might move a transaction forward. So it could be as something as simple as.

Constantly coming down the escalators at, and this was later, but, 200 Park into Grand Central and realizing that there were young people, meaning people in their early to mid thirties that were commuting, they were heading onto the commuter trains. And this was. Before the millennials had moved to the suburbs.

Nancy: Right. 

Darcy: So we did some research, found that the sales in the 10 towns were going up [00:06:00] and started to say to people, the millennials are moving to the suburbs. And it was such a bold statement at the time, that a member of Brookfield who had just been hired to sell 2 45 Park at a broker event that night said to a group of brokers, you wouldn't believe what Darcy Stacom said.

She said, the millennials are moving to the suburbs. Everybody didn't laugh because my husband was part of that group. But it was, it was in fact turned out to be quite true. And so, studying things, reading things, and I read from From People Magazine and page six all the way to The Economist and anything I can to just look for something new and different and people welcome you in the room. 

Nancy: Wow. Do you read differently today than you did 20, 30 years ago? 

Darcy: Yes. Yeah. Yes. 

Nancy: Did you read mostly online now?

Darcy: I do. I do, yeah. And it's hard to stay concentrating long enough. So if it's really something that matters, I try to force my way through it and then I look up into [00:07:00] other sources.

Nancy: Yes, 

Darcy: because you can…

Nancy: trust, you trust it less. 

Darcy: Yes, definitely. Yeah. 

Nancy: That, that focus. So what do you, what are the factors when you, when you're today, that you're really focused on, that you think really make a difference on the transactions that you're looking at? 

Darcy: I think right now for, you know, in the office arena, the thing that's gonna make the biggest difference is how do people spend money more efficiently.

We're seeing, because we've just went through this period where office is the capital hog, and the first thing everybody does is call up an architect, and then they call up the person who's excellent at doing lobbies, and you got. $5 million out the door before you've even interesting thought about it.

And then they're creating an entire floor of amenities. And then they're projecting all these revenues for those amenities that are not actually coming in. Do we need amenities? Do we need a better lobby? Sure. But that lobby should feel much more like a hotel experience. And I know this is a little bit old now, and that's what people are doing, but I've [00:08:00] watched recently a group called WAS, who's doing like a more adaptive reuse of the existing space.

So if it has marble walls, it might leave the marble walls, but they grind the marble floor. Interesting. And so they're not ripping it out. Yep. Put a lot of curtains down a hallway as opposed to gutting all the sheet rock and rehanging. So it's how do you, how do you move things around and make it economic?

Because the CapEx for..

Nancy: a lot of these office buildings has just killed the…

Darcy: It's been out of control. Yeah. 

Nancy: Can you do that? Well, you can't really do that when you're doing office conversions. 

Darcy: No, 

Nancy: I mean, there are

Darcy: It's, I mean, yes, maybe you can keep, maybe you can keep the lobby, but probably not.

It's probably gonna be out of scale. Right, right. To the apartment building. 

Nancy: Right. What are you seeing it, well, let's just talk broadly about office since we're there. Are you seeing Office coming back in New York City?

Darcy: I see a lot of strength. I mean, [00:09:00] it started with the top 10%. Look, by the time we got to 2023, everybody thought the world was over and the world was over.

Right. Interest rates have risen. People were working from home. Nobody knew what it was ever gonna come back. We're, you know, we're full two years past that and it turns out that a lot of companies have a lot more strength in telling their employees what to do and bringing them back to the office.

Plus, I think a lot of employees like, “okay, I can't spend 24/7 with the interruptions that can occur with my children or my pets or whatever.” You know, just when a lawnmower goes off outside your window and you're on a conference call, it's like, whoa. So I do think that we've seen a huge amount of people returning to work here in the city.

You also, I mean, it's just true. You need a mentor, you need multiple mentors across your career. It's very hard to lock a mentor in on a Zoom call. 

Nancy:  Ugh. Right, right. That's the worst. 

Darcy: It's the little moments that really build…

Nancy: It's hard to mentor somebody on the [00:10:00] Zoom call too. 

Darcy: Yes. it's the little moments that build the relationships.

So we've definitely seen the back in the B category, we've, and seen actually, again, enormous strength. And in many ways they couldn't be more efficient 'cause they don't tend to give as big of a work letter or do Right. Much of this gutting of the real estate and now what will start to see, and my hairdresser will kill me for this, but he's in this beautiful space on the 10th floor overlooking Union Square.

And I said to him, “Do you have a year? Do you have two before we end up on a side street?” Because everybody did a flight to quality. And everybody went to a better location when the market cropped out. Now law firms are growing like. Yeah, both what's happening in DC and AI So if you think about the demand that comes for them.

It's an explosive growth engine here. We're seeing a lot of finance growth and we're also seeing a lot of AI growth now. 

Nancy: In the city? 

Darcy: In the city.

Nancy: [00:11:00] What kinds of companies? 

Darcy: Literally ones that have specialized in AI. They might be an AI company that, you know, is focused in the plumbing industry, or an AI company that's focused on the transportation industry, but new requirements even of size.

Nancy: Do they need prime space or are they happy to go take the back office space? 

Darcy: Aware of they, of a couple that are, I'm aware of a few that are looking, you know, close to Grand Central and real avenue buildings. 

Nancy: Wow. What, what are you seeing in terms of sort of the conversion of the sea buildings or the Midblock buildings?

Darcy: So we've seen, I think it's close to 20 million feet, and I think we still have more that will come. We're at a cross point though. Which is that the 35 year tax break, if you're not already in the ground or in the building converting by June of next year, we'll drop to 30. But at the same time, office values are moving up.

So you're just reaching this point where those [00:12:00] 35 year tax breaks would've made a big difference in being able to go ahead with the conversions. So, I think it's gonna slow down the rate of conversion. Which would've been really fantastic for New York City to just get more housing and to remove more of the C Office stock. So, and then the year after, it goes down to 25 years. 

Nancy: Can that get reversed though? 

Darcy: Right. It would be nice. It would be nice if they could extend, extend. 

Nancy: Is it, is that city or state? 

Darcy:  I'm not sure. I don't wanna misspeak. 

Nancy: Do you see any capital flight or pause because of the mayoral election and, Mamdani sort taking a lead?

Darcy: I think that at the moment he won, the primary. People went, whoa, whoa. Then people being New Yorkers said, you know, we've, we've lived through a lot, we've lived through many different types of administration, but it remain, I think it's gonna remain to be seen after the election. And how, you know, he or [00:13:00] whoever fills out their cabinets and their committees and their councils and that will be a tougher tell. But I say to people when they talk about it, I'm like, “shall we talk about politics in your country?” 

Nancy: Well, we won't talk about politics on this podcast for the moment, but, but what, I mean, I've heard in your view as much broader than mine.

I've heard about transactions going on hold. Because people are concerned about what Mamdani politics might mean for the city. People are concerned about flight of certain businesses. Have you seen transactions be put on hold? 

Darcy: Yes. I mean, I definitely saw a pause in bidding on one of my transactions. But then it came back. Look I, Scott Reckler said in front of a b of a audience, so he and I just did a panel at their re conference. He said that he spent 90 minutes with Mamdani, and in it, Mamdani pledged to continue to [00:14:00] support our police commissioner, which would be huge.

I think many of the changes he wants really are gonna depend upon the support he gets from both, Albany. Right. And also in his interaction with the business community, right? So I'm hoping that as you age, you change and you grow. And that it fits him too. 

Nancy: Right. Well, I guess we all know that he's never run anything.

Right. So, um, there's nothing like experience to give you some perspective. So let's back up a little bit. I kind of ran right to current affairs, but let's talk a little bit about your background. You come from a family that, was in the real estate business, your dad, your sister.

Tell us a little bit about what it was like kind of growing up in the shadow of your dad and then, you know, are you and Tara the best support for each other, or how, how did that work out? 

Darcy: Right. So growing up in real estate, I never really [00:15:00] understood, you know, what it was that he really did until one time he came home from a trip to Chicago and he had a pic, he had a hard hat from the Sears Tower and a magazine article about that.

And it was actually a deal where he, in the very last minute when he had the sales agency called on Sears and said “I think we can build the tallest building in the world and get you better advertising than anything on the planet.” So that's when it kind of came home to roost. It was always clear that they were directing us to real estate. We grew up, 

Nancy: They being your… 

Darcy: Both my parents.

Nancy: Your mom was involved. 

Darcy: Yes. Yes. And we grew up in Greenwich Big House. Called me downstairs when I was a teenager, early teenager, and said, you know, take a look around you. And then the next part of that sentence is, someday part of this will be yours. They said, just so you know, we're gonna spend it all.

You're gonna need to make your own and you're commuting to New York next summer. You're not [00:16:00] gonna be at the Greenwich Country Club. And I was like, “wha-wha-wha-what?” 

Nancy: How old were you? 

Darcy: I think I was 15. 

Nancy: Wow. 

Darcy: And so I did good for, in fact, for head off to the mail room At C&W and then to the market research desk at C&W

And you can have motivation two ways. You can never have had anything. and want it desperately, or you can have had basically a lot of everything and lose it and want it again. So that was my real motivating factor because for many reasons there really wasn't anything left. And so I joined my dad with Tara.

But he had, this… 

Nancy: Is just the two of you in the family? 

Darcy: No, no.  There's six of us in total. 

Nancy: Oh, wow. 

Darcy: Yeah. Okay. So, and, it was just a, it was, the setup wasn't great. It was like, you know, if either of us made a deal, we both made the same amount and it was a relatively small amount. I came up with a solution to a very complicated [00:17:00] transaction.

I'd gotten my father to agree to pay me more. I said, pay Tara, whatever you want. You can pay the same amount, but I wanna make more than I'm making. And when it closed, he booked us both the same amount again. So I prepped, prepped for it. I went to see him, and he immediately got furious. Because I'd had a piece of paper that I'd put to file.

How dare I, and I had to quit and I had to go downstairs and sell buildings, which I had already set up a contingency for. Wow. So he didn't fire you by the essential did Oh, he called me a math moron and I couldn't sell an office building if it hit me in the face. He didn't have to fire me. He gutted me.

Nancy: Oh my goodness. 

Darcy: Yeah. I mean, look, we made up over years later, by the way. But we made up and had a great relationship later. Tara stayed working with him. And Tara and I, I think are, we're very big supporters of each other. We're definitely in different areas of the industry. Uh, she, 

Nancy: what is Tara Tara's doing?

So Tara mostly does leasing. 

Nancy: Leasing, right. 

Darcy: [00:18:00] Both tenant rep and agency. She's been a big driver behind a company called In Inventium, which is in the AI blockchain space. And I've actually become an investor in that because I know what you know, I know she knows what she's doing. And this is, you know, extraordinary company. So we have a very close relationship. So 

Nancy: So did you have other mentors in your career. 

Darcy: Yeah. My number one was, back at, at C&W and it was Arthur Ante who was in, he was actually in the legal department at the time, became the manager. And when they decided that they were taking sales and turning them into capital markets, 'cause there was no such thing as capital markets, that's how old I am.

And so they asked brokers across the country to raise their hand if they view themselves as sales broker. And I think 500 people raised their hands. And I was one of them. And [00:19:00] there were 50 left two days later and I was not one of 'em. And so fortunately because I'd made, 'cause Arthur was my mentor, I was able to go to him and go, “Arthur, please.” And so he gave me a break. And then my later mentor, um, Marty Edelman at Paul Hastings who are of council, has been an extraordinary force. 

Nancy: Marty has, has supported so many young people and many women actually. 

Darcy: Many women, yes. 

Nancy: Yeah, yeah. Quite, he's another quite extraordinary person. So how did your career get rolling? What, what were some of the early key steps? 

Darcy: Again, I couldn't get an exclusive early on, so it was really trying to just, you know, get somebody agree to let me try and sell something and then see if I could get it sold. And I have a number of stories in that area, but I finally had decided that it was three years in and I hadn't sold anything.

Or two and a half years in. 

Nancy: You worked for two and a half years and you didn't sell anything? 

Darcy: Nope. 

Nancy: Were you on pure commission? 

Darcy:  [00:20:00] Yeah.

Nancy: So, you were a little hungry. 

Darcy: Oh, yeah. So, and because when I had done the bigger leasing deals that my parents had taken it all back as repayment for the draws, which I was like, “wait, what?”

So actually Tara and I ended up selling our first building together. She came up with the lead, I came up with the buyer, and then that followed with, just a series of transactions that were somewhat off market. I remember that on one East 42nd Street, I finally got somebody to hire me to sell it.

And every guy in the office picked apart the assumptions that I did. The brochure that I wrote, it was just

Nancy: That's the building on the south side of the street. 

Darcy: It's actually north side of the street. It's one building in from the corner. It's one east, but it's not the corner.

Nancy: Oh, i's not the corner building, which is like the disco lobby.

Darcy: Okay. Yes, yes. Okay. [00:21:00] It was a trial of, oh, it was amazingly difficult, but got it done and then was able to start moving on from there. 

Nancy: Amazing. So when you sold these buildings, like what was the, was it the analysis of the building? Was it the outreach was, was it putting together better brochures or books or models? What was, what was your secret sauce in the early days?

Darcy: So I was never an entertainer, ever. I didn't take people to breakfast, not lunch. Definitely not there.

Nancy: I shouldn't ask you about your golf handicap. 

Darcy: Yeah, no. I was actually a really great golfer once upon a time, and I was supposed to take some Japanese clients to play golf, and when they found out my handicap, they, they canceled.

So golf was not helpful. 

Nancy: Oh, dear. 

Darcy: Yeah. Yeah. But, so instead it was really the quality of the research and the quality of the follow up. And I, I can't say, I look back at [00:22:00] my materials now and I'm like, oh my God, a 4-year-old could have done better than that, but they were kind of cutting edge at  the time.

Nancy: Well, so has the business changed dramatically with, AI and, and just all the technology that we have or the. Is the amount of information much, much more in depth, and how is it presented differently?

Darcy: I would say it's, you know, building the capital stack that started, you know, a good 10 to 15 years ago changed very much the dynamics of the industry.

So it was never you, there was a time, I remember my dad was, you know, able to put this person in touch with that person and then six months later he might hear he'd made a fee. This is really all about the quality of the materials, the people, you know, the follow up. I would say the relationships I've built have been really critical.

The ability to pick up the phone and call somebody and go, I need help. I need to know how this person really acts. I know how they will react and then be willingness to return that favor right [00:23:00] at a later date. I remember Doug Durst did a huge favor for me in providing information and I was able to return the favor at a later date and so, but now, AI, Wendy Silverstein has become a really big fan and really good at it. So I think it's super helpful. But you do also need to understand the provenance of the data. 

Nancy: Of course. 

Darcy: Sometimes I look up a sale that I did and what's been written about it, and I'm like, “yeah, that's not what happened.” 

Nancy:  Right, right. At least it's only sometimes.

Darcy: Right, right. So, AI doesn't know that. 

Nancy: Yeah, of course. 

Darcy: So I think that there's gonna be that balance. You're are you gonna get great information from AI? Yes. But are you really gonna know then the dynamics of, of what drove the transaction? No. And I, until AI can develop a, if it can develop a greater sense of intelligence to read between the lines, I don't think that, I don't know that that can be [00:24:00] replaced.

Nancy: No, no. When you're engaged on the sell side, what's the buyer pool for a major office building. Let's say, for one of the Darcy skyscrapers, what's the pool of buyers look like today and how is it different from what it might've been 30 years ago? 

Darcy: Right. So we jokingly call them Darcy deals and, I would say that it was, even if you just go back 10 years now you really had the institutions playing and now you just don't, I mean, I know nor just, just stepped into 1177 with Beacon, but there's not a lot of billion dollar players out there that are institutional. You don't see the Calister, the CalPERS, you see Ohio stirs exiting. You don't see them entering. So it's been more of the ultra high net worths that are in play in the market and, and some of the syndicators who are playing, at their synagogue.

The old [00:25:00] saying was past that. But you know, you have a lot of wealth and they will go behind somebody that they really believe in. And that's how the transaction gets done. 

Nancy: So how about the big private equity shops? 

Darcy: I think the big private equity shops are definitely playing. I mean, you saw them play behind Recer on right, on five 90, but that's also really a recer relationship.

So it's less likely, I think, personally, it's less likely that you're bringing that I, the broker is bringing that private equity shop to the table. It's more likely that they've already been in the relationship. Now, on the other hand, getting, you know, who was it Bow post to do the prep equity is something where somebody else was involved to bring them to the table. So, and that's the big change too. Bow posts can play in pref and get outsized returns when they used to have to actually buy the real estate to get the outside returns. 

Nancy: So, so how do you, so as a sell side broker. You, do you [00:26:00] actually, do you actually develop the capital stack and say, we're gonna sell this much, you know, obviously we're gonna get it first and then we're gonna sell this much pref or, or a me and then we're gonna do this much equity? Or do you let the market figure out how it wants to, to be up the capital stack? 

Darcy: If you, if you're up at the top, you've gotta fi-you have to help build that capital stack so you actually market the different tranches. I mean, when I was out with four 10, 10th, which, SL Green brought me in back in right at the first year of COVID and was like, we need you to sell this, but you gotta come back in.

Nancy: Which one is four 10 10th? 

Darcy: Four 10 10th was the one that was anchored by Amazon and Republic National Bank, right across the street from Hudson Yards. And, or right in the heart of Hudson Yards really. In that case, interestingly related was like, “I'm ready at 50% of the stack. Go find me the other 50 Brookfield, Darcy, you have anybody for the other 50?”

I mean, really became much more the process of where. Somebody might have gotten paid to go find that equity. Now you just got to go find that equity to [00:27:00] get the deal closed.

Nancy: Interesting. Yeah. And then how do you reach out to you, you know, talked about high net worth, how do you find those people?

Darcy: Right. Really relationships and exposure. I mean, it has been helpful to me to be in the press a lot. It's been also harmful to me to be in the press a lot, but it's a life you have to live and that, that causes people to recognize your name. I don't even exactly remember what transaction, I think it was actually somebody who wanted to buy the Empire State Building, called my admin and said, “We're looking for the queen. Is that her?” 

When I got on the phone, they're out in the Middle East and they're like, “We want you to goodness you to help us buy the Empire State Building.” And we understand Tony Malcolm. So I got 'em a meeting. They ended up buying, you know, a big chunk, a good chunk of buying into the Empire State Realty Trust.

Nancy: Oh, that is too funny. Sorry, but that just this morning you saw the pomp [00:28:00] and circumstance on the tv with Trump in the UK and so, people, people do still think about the queen or the king. You talked about being, it being harmful that you have also been in the press and I'm like, most people in your shoes would wouldn't care.

So what? Yes. I mean, you're, you are powerful, successful woman and you've done it by not obeying the rules and having your own style and not being the people pleaser. Why do you care what's in the press? 

Darcy: Yeah. I mean the problem is, is that when you get to a certain stage, your name can attract headlines and your name can attract attention.

And so I often, you know, I always respect the clients of wishes. So if they don't wanna be in the press, I'm not going in the press. 

Nancy: Sure. 

Darcy: There are [00:29:00] situations where I've had competitors lead off talking about the, the Google's purchase of Chelsea market and there was ironclad locked down. No one was allowed to talk about anything with that purchase.

And I wake up the next morning and they're sitting there going like, well, this is why I got them to buy this building. I'm thinking, “Well, for the last two years I never saw you in the room. Not one day, not ever.” And some don't care. And you know, but I got blow back because it ended up in the press because I actually worked really hard on the transaction.

Nancy: Right. Well, hopefully your name wasn't in there, but… 

Darcy: I don't think it was.

Nancy: Right. Let's talk a little bit about your role and leadership style, because obviously, powerful women get criticized for being, aggressive and, you know, different standards. How have you and you obviously grew up with a dad who, didn't seem to mince words around you.

And [00:30:00] probably, you know, and I know from my own experience, the way you're treated as a young person, instinctively is how you tend to treat people when you're under stress. And it's really hard to change your behavior and become more self-aware. So tell us a little bit about your management style and your journey.

Darcy: So I. Yes. I grew up with very tough men who trained me. I mean, and they didn't think, I mean, they actually loved, in my opinion, torturing me. I mean, it was, I remember John Dowling ordering me out of his car 30 blocks from the office while I'm wearing four inch heels, there were no cell phones. I had no money on me and going, you know, “Just check out the neighborhood on your way back.”

I get it to the office and they're like, “Mr. Howling is waiting for you.” And I'm Betty basically ready to crawl to the office. And it was so, you know, I mean, you watch what they get [00:31:00] away with. Right. And so nobody ever teaches you otherwise. I had a tendency, I would always have four admins in the department I'd, I would be able to promote one and the other three didn't really like me for that.

But at least I was getting one up out of that. And that I'm proud of I do wish earlier on that I'd said to the firm, “I'm really a broker and advisor. I don't want anything to do with the day-to-day operations.” But because I was actually so good on the financial production of it, they never came anywhere near me and the department.

So I was trying to balance both and that's incredibly hard. Mm-hmm. So what I've learned, what I learned later was. Really to constantly lead with thank you. If somebody came in with my least favorite five words, which were, “Can I have five minutes?” I'd have somebody else take the meeting. You know, [00:32:00] nothing good follows. Can I have five minutes? So just to get out of that process and then to just, I always did a lot of team building things. I did, we'd, we'd take helicopters around the bottom of the island. We would, you know, go and see the newest building and get a private tour. We went up through an OVA, but I don't think I was good enough at like really understanding what people needed as people got in more encouraged to look for constant support. 

Nancy: So you've worked mostly in New York, is that right? 

Darcy: Yes. I mean, I've definitely done transactions [00:34:00] elsewhere. But it's been, look, you look out the window and go, if you can't stay busy here, what's your, what's the point? 

Nancy: Well, I'm curious, as you have evolved your geography a little bit. How you find other parts of the world and or other parts of the country, and if there are places that [00:33:00] really speak to you as really other interesting markets?

Darcy: Yeah, I did, I've done a decent amount of work in San Francisco, but over decades, not in any one consistent time period. So I always could relate to San Francisco.

It's, it's a really just a really fascinating city. I've done some work in LA successfully and in Chicago. I would not say that my style translates all that well down south. 

Nancy: You don't speak southern. 

Darcy: when I think I'm dialing it back big time in another market they'll be like, “God, you're moving so fast.” And I'm like dial it back. 

Nancy: So, so are you still as driven today as you were at the beginning of your career? 

Darcy: Yes. Differently. Okay. I don't have to lead the league tables. I don't have to read my name in the newspaper constantly, but that was a requirement of a platform of the size of a CBRE, right?

You have to be out there all the time and you have [00:34:00] to be dominating the market. I mean, it's just it, or you should be if you're leading that platform. Right. So I, but I've, I've had a lot of fun. I have a, a major transaction that should be being, being announced shortly that it will be go down. I mean, it's still got pieces of the puzzle, but honestly is one of the biggest of my career.

Nancy: Wow. 

Darcy: Completed something for Vernado at Penn. 

Nancy: That again, what was that? 

Darcy: The ground rent review. Um, that also since starting the firm, proud of having rep JP Morgan on their purchase of two 50 Park. I've been doing some more buyer rep…

Nancy: So 250 Park is the building just south of their new building?

Darcy: Yes. And I mean, I think they could sell it for double what they bought it for. 

Nancy: Yeah. But it protected their views. 

Darcy: Well, it does, but it's like they, they're gonna, they'll use it in some fashion. Helped a big group out of London and Israel on their first purchase on Third Avenue and helped on the, the eminent [00:35:00] domain of Union Station in Washington, DC where I was…

Nancy: Oh, wow.

Darcy: Expert report. Expert witness. So I can do what I want. I mean, those are things at a big shop, they're like, oh, I don't know that I want somebody going up against Amtrak. Right. I, I, I don't know that I wanted them on the opposite side of this owner on a ground rent review. So these are, it's a, there's a freedom that I can enjoy and I've been able to turn a lot down and that's kind of nice too.

Nancy: Is it different? Does the brokerage business very different today with the main, the biggest firms being public and also the consolidation that we've seen in that business?

Darcy: Yes, yes. I mean, look, you, you take a, you take one of these big. Corporations, they're big corporations now. The brokers do not make or break their future.

They are important to it. They really drive a lot of dollars to the bottom line. But I would also say those corporations can use their brokers better. One of my mentees is, one of the top data center brokers in the world.

She [00:36:00] approached me out of the blue, her name's Christina Metzker. I'd be behind her figuring out every resource I can give her to build the biggest phenomenal platform. 'cause she went from being a data center leasing broker 10, 12 years ago. Comes to me from San Diego, California, and goes, would you mentor me?

I wanna be you. And we've got a very close working relationship. It's important to take people like that. 

Nancy: So she sells the data centers, not just policing. 

Darcy: She's, she's it. She's it. You know, how to take them and turn them into running a real business while still being a broker. 'cause if that's what somebody loves, it's what they love. Right. I watch people at the other big shops that have extraordinary potential in unique areas of the market.

Again, how do you take that person and turn them into more, nobody ever worked super hard at me, at any of my shops to try and turn me into something different or more in a meaning… 

Nancy: Thank God that [00:37:00] wasn't necessary, but Okay. But, but in a, in a way that would've improved, would've helped us both.

Sure, sure. Right? Yeah. Yeah. No, ma Yeah. It's. It's still not a highly managed business and obviously still a very highly entrepreneurial business…

Darcy: And we're viewed as unmanageable. 

Nancy: Yeah. It'll just, I think, how AI and the true transparency of a lot of information is going to change the entire transaction business for real estate.

I mean, obviously it impacts Park Madison Partners, impacts your  business. It impacts all of this, and I, I don't think we, you know, we have, we're just at the beginning of that. 

Darcy: We are, but can you imagine when you can actually give accurate data to, you know, when you're handling your property for sale and you can really say like, these are the volume of people that are going by your property every day.

These, this is how the card swipes are occurring differently. This is how the transportation has slowed, improved, whatever. It's like instead of just digging around [00:38:00] for that  data for days, right, you can actually go look for something that data matters. But there's also other data that matters more.

And so when your analysts are stuck trying to find things that it's just impossible to find. If AI can go scrub it, great. If you could go through the process of pulling permits to build a building faster and more efficiently, wow.

Nancy: This may get back to the, the tech company you mentioned before, but one of the, one of the observations I've had in talking to people is that the very big companies have so much data that they can't scrub it and they can't figure out their systems so that they're really not very efficient today at implementing AI techniques in broadly, say, marketing a building.

Whereas startups can start from scratch and have a much better chance of getting good clean data and figuring out systems that people can really, within their firm can really use. What's your thoughts about all that?

Darcy: The company I was mentioning [00:39:00] before is an open architecture data. And so they want to be in a position not to take a copy of your data, but to act, which is what Google would do, or, I think it's Snowflake would do.

But instead you be able to access your data and then use it in order to drive decision making. So everybody's just super like this about their data. Right. So these small shops don't have that data. Right, the data that exists inside of a Salesforce or inside of any, any one of these big platforms, you can't, you can't compete with that.

So you might have better systems that aren't, that aren't trying to be patched and patched onto. Right. Because I remember when we would have a database, and I don't know if it was Salesforce or what it was, and they were trying to come up with version 4.9. The, it was the architecture of all the ones up to that, that were messing it up.

So, yeah, they could be more efficient there. But the [00:40:00] sheer volume of data that Yardi has, I think a small firm can't compete. 

Nancy: So you're advocating that the big firms will win this race 

Darcy: in the, in the long run. Yes. And they'll probably just buy the small firm. 

Nancy: Yeah. Yeah. Tell us a little bit about your new business. So you started the company, and a year later you have Wendy Silverstein joined you. Yes. Tell us what your, why you started it and what the business plan is.

Darcy: I think I just reached the stage. The firm had said to me, look, find your successor, which I had done and, and had really given over largely control.

And I went, what's next? You know? Like if, if there were deals that I had sold before and they came back. He was mostly running, you know, starting to try to run the show on those, or running the show on those transactions. So it was so I wasn't necessarily even getting to do what I wanted to do anymore, so I thought, “all right, I'm gonna do this.”

And it took a while and it was painful to reach the conclusion. And I can say this, [00:41:00] the number one thing that every broker undervalues is having an in-house legal department. 

Nancy: Oh, interesting. 

Darcy: Having a marketing department, because those two things cost a lot of money and are inefficient. So as a small business.

And so that's been the part that I've had to learn a lot about. 

Nancy: Maybe you need the lawyer as a partner. 

Darcy: Yes, probably. But, the phone rang. It's a lot of actually interesting things. Actually. People called very early and I was not in a position to handle, 'cause I was still completing transactions for CB.

Right. And then trying to do my own 

Nancy: Hard to be in the middle. Yeah. 

Darcy: It's hard to be in the middle. So as those most of, as most of the CB transactions closed. I was then able to start hiring people. Then Wendy called up and said, look, I'm bored. And she's got a brilliant brain.

She's always on the move. And she'd finished her tage transaction. And so, she said, “what do you think?” And she'd been [00:42:00] my client and my friend. And so I said, “yeah, let's do this.” So we have very matching skill sets. Like we cross in the middle of having deep knowledge of real estate, but she's really about the corporate structure and the corporate governance and the cap, the debt capital market side.

Whereas I'm much more about the equity and all that goes with that. And ability to read a room and figure out human, figure out the emotions that are where I think AI is not gonna be able to compete. So it, it made for a very logical partnership. 

Nancy: Great. That's amazing. Right?

So how are you gonna grow out the business? And, you know, as you see at any given point in time, in over four decades, we've seen periods where the Japanese were buying everything and then the Chinese were buying everything. And then the, now it's the Middle East, and the high net worth groups.

But how will you be able to reach out to this whatever the next network [00:43:00] is, especially if they're overseas to make sure that you can be competitive on the sales side with the bigger firms. 

Darcy: Right. To stay active, stay present, have transactions get closed, that people hear about to reach out.

And reintroduce, and I'm going to London to do something at a conference and we'll be calling on a lot of people there. I've stayed close with all the top players in the industry here, and I've said to them, “if you think of anything, please do.” I really tapped hard into the women's network too. And said… 

Nancy: How'd you do that? 

Darcy: Well, because I'd already been very actively involved in maybe the first 10 years of my career. I wasn't, yeah. But after that, I really got deeply involved in 

Nancy: Are there organizations that have been helpful or just informal? 

Darcy: I think it's been more, yeah. There are good organizations, right?

Nancy: Yeah. There's WX and the others, but it's been more organic, and just reaching out. When I was involved with New NYU Shaq [00:44:00] very early on I, Wendy was our first honoree followed by, I think we got Margaret and Nadu. Um, then we got hin, you know, the people I knew, but, and so casting that net. 

And you take Wesley LePatner, who I'm so sorry about what happened, but… really devastating. 

Nancy: Brilliant, brilliant woman. 

Darcy: Brilliant. But she immediately welcomed us in and said, what can I do? So that girl's network is in alive and well in this city. And I think we've all gotten past that stage where it's like her or me. And so we're working hard in that area. 

Nancy: Yeah. That's great. That's great. And when you're selling a big building, do you just assume that people in Dubai and Qatar will hear about it? 

Darcy: We recreated our database, from information I was allowed to take and old [00:45:00] status reports and everything. So it just went back and recreated it and so have reached out to people. And recreated touch points. 

Nancy: It's a lot of hours, Darcy. 

Darcy: Yes. A lot of hours, but all those ones where I don't have to spend on the, “can I have five minutes.” 

Nancy: Well, that's true. You get a lot of time back. 

Darcy: I've gotten a ton of time back.

Nancy: How do you see the public private markets today and  are you seeing opportunities from the REITs? Are they more sellers? Are they more buyers? Are they competitors? What, what's happening in that space? 

Darcy: Look, you just saw Paramount trade this morning. 

Nancy: Yeah. Yeah. 

Darcy: Right? And that, I don't think it's a great valuation.

Nancy: That was aggressively bid after it sounds like. I mean, I just know what they read in the press. 

Darcy: Yes, but I think it undervalues that inherent real estate. I mean, that is excellent. A lot of it's really great real estate whether it's here or in San Francisco. So, but, but it was a big ticket. So, that [00:46:00] changes things. And there are other factors. 

Nancy: Do you know how they did the debt on that transaction? 

Darcy:  I, I don't know yet. 

Nancy: Yeah. No, no. Sorry. It's, it's all literally brand new. 

Darcy: Yeah. Yes, yes. Um, coming out of the, there was a lot of debt that Paramount already had Yeah. On the deal, on the asset level. Yeah. Uh, look, SL Green has remained active in the market. Vernado just purchased 623 fifth and is definitely active in the market. Boston Properties is building as opposed to buying. So. 

Nancy: which is amazing, right? Who would have thought? 

Darcy: Yeah. Look, I give them, I give them really huge props.

I said to everybody, Axel Stawski was the guy who actually built the building at the corner of 42nd and, and fifth that you're thinking of with the crazy colored lobby. He always built countercyclical, always like four times he built counter-cyclically. And he crushed it every time. Boston property is already reportedly as CV [00:47:00] Star and a couple of other tenants.

Really. So, yeah. It's hard to go against the cycle, but if, if you can, uh, usually… 

Nancy: Well yeah, look at JP Morgan here. And one Vanderbilt, which obviously was the COVID Yeah. Dame online. Yeah. And, and we can look up Park Avenue and see a few other holes in the ground.

Darcy: Yeah. Yeah. For one of which is for sale. 

Nancy: Oh. Later. What, what do you think will happen to. Sort of the third Avenue and sixth Avenue, which at the moment have, you know, clearly been under from a leasing standpoint, underpriced and less desirable than the corridor between them. Do you, do you see them?

Darcy: I think Sixth Avenue is pretty full actually, and is doing extremely well on the rents. I think that a lot of big law firms over there, for example, and there's been a good amount of growth. So while it's not performing at the two to $300 level, which is Park Avenue, I think it's performing.

Yeah. Really well. This last six months has been an incredible change in the leasing [00:48:00] market. Third Avenue. Interestingly, has both the, a lot of residential conversions. And it had a lot of medical purchasers. 

Nancy: Oh yeah. 

Darcy: So the volume of office is down substantially on third and what we're starting to see is that the small private equity shops, for example, that were on Park Avenue that need to grow that are being priced out by the blue owls or people like that are being forced to move.

Nancy: Really? Over to third or…

Darcy: Well the third is not a bad commute. If you're commuting to Greenwich, you're rye. Right?

Nancy: No, there's, I, I grew up on Avenue Sea, so there's nothing wrong with Third Avenue, but, it just, it was really you, you couldn't lease those buildings Two, three years ago. 

Darcy: No, no. 

Nancy: So interesting. What's get, what gets you really like jazzed up in the morning? What are you most excited about these days? 

Darcy: Just talking to people. Yeah. And just seeing what they're thinking and seeing [00:49:00] and just trying to watch how AI will impact us and how we can use it successfully to make things better.

I do wanna bring people back to, I wanna bring the institutions back to wanna wanting to buy office in New York City. I think that they're being a little slow on the trigger, and that may be because the stock market has performed so well and you have infrastructure as a whole another very, that class has really moved up dramatically and they all wanna be in data centers.

Right, right. But this is an excellent investment vehicle. And I think that's something they need to be looking at now. So that's one of the things I'd, I'd like to play a role in. 

Nancy: Yeah. Oh. I think you'll start to see pension funds, you know, coming back more on a direct basis. Yeah. Over time, although obviously they own quite a bit of it in the open-end funds and the, the big, multi-billion dollar, [00:50:00] closed-end funds that they're invested in.

Darcy: Right. We also need to see this market change so that we have more five, 10, and 15% sales, because when you have a building that's worth $4 billion, you need to, like OVA has sold pieces of that building. 

Nancy:So as a condominium you mean? 

Darcy: No, just buying into the venture and only owning 10, 15, 20 5%. 

Nancy: Oh. As, as, as if it buying a piece of the partnership, if you will, or the joint venture.

Darcy: Because the build, they're just, they're too valuable to get, you know, if it was one thing when the assets came up from 500 million to billion when they started to get to 2 billion.

Yeah. It was like you rarely saw any one person. Yeah. Entity. 

Nancy: Are you're seeing CMBS being the primary, source of debt? 

Darcy: Yes. Yeah. Yes. And it's definitely a functioning market now. I think, we could see the banks move back into the space more and the insurance companies maybe move up. The size of deals that they'll do.

We'll see what the Fed does [00:51:00] today, but, but in the long run, does that in fact, long-term rates? Probably not. 

Probably not. Yeah. 

Darcy: Yeah. 

Nancy: Yeah. What's, what's your view on rates like? 

Darcy: I do think there'll be a drop, and I think we'll see, you know, a couple of others, but I think ultimately the amount of volume of US debt is going to prevent term decline in long term rates.

Nancy: Yeah. Yeah. It's hard, it's hard to see it. I mean, if you, even if you see a drop in short rates, would you, if you were pricing a building today that you were gonna finance a year from now, would you assume a 4% treasury? 10 years, sorry. 4% tenure at treasury. 

Darcy: Yeah. I’m not sure, right? 

Nancy: I guess you don't have to do that, right?

That's part of being on this side of the transaction. But that's really, I think that's kind of where we see the market. 

Darcy: I just mean there's so many moving parts in the world right now. I mean, it's like, it's, so many things are, 

Nancy: Of course, but that's why transaction [00:52:00] volume is still so low, rather a relative basis. I'm not talking about just New York office, but…

Darcy: And I also think it's the geopolitical is what I was referring to. That's too hard to predict. So you asked me a year from now and I'm, I'm gonna have a hard time on that front. 

Nancy: Yeah. Yeah. I don't really wanna think about it that way. It's really, it's not productive.

It's hard to move forward. What, what do you do in your, what's your. What are your pastimes, your hobbies? 

Darcy: Oh, there's one. I am, we now own effectively a small farm in, in upper well in Fairfield County, and I'm a huge gardener, so 

Nancy: Oh, fun. 

Darcy: On, on Mondays I come schlepping in with giant bags and to give to the team and to give to my doormen and bring to my mother-in-law.

Nancy: What do you… So flowers, plants, vegetables. 

Darcy: Vegetables, vegetables, vegetables. 

Nancy: Really?

Darcy: Yes. Yes. 

Nancy: So how do you feel now that it would get into fall as it kind of… is it bittersweet?

Darcy: Yeah. I'm now going, oh, I didn't order a hoop house, you know, but I just, I did just over the last few weekends, [00:53:00] plan all my fall vegetables and still about to, I think I'm close to harvesting sweet potatoes and it's been a bumper, bumper crop year.

And I'm also heavily involved with not-for-profits, and that's not a physical activity, but it's something that takes up a good amount of time. And this weekend, although I can't vote in the town that I'm in, we're a quirky little town called Easton, Connecticut, which is just in land from Westport and Fairfield.

And it's not well discovered. I mean, it is literally Vermont in Connecticut and it's way less expensive than most you can get real property. So. 

Nancy: Amazing. 

Darcy: Yeah. We actually have a 15 acre farm and Fantastic. So I'm hosting a Democratic fundraiser. 

Nancy:Oh, wow. 

Darcy: I can't even vote in town, but I'm friends with the woman who runs the local coffee shop and she's running for selectmen, so…

Nancy: There you go. Oh, that's, that's fun. 

And plans for the next couple of years for the business? Do you see it growing?

Darcy: I do. We just had a new employee [00:54:00] start on Monday who I will not name. 'cause people can usually go after my employees. So knowing they're well-trained, but yes, I do expect that we will grow and I think, Wendy and I are just gonna be starting a new assignment that's really perfectly suited to the two of us.

I think that there's gonna be dynamics that will allow us to do more and to maybe do more stuff nationally too. Which would be, which would be of interest. The time to travel and, and look at different markets. Right. So it's the, the doors are open and we're still able, you know, I still have all my knowledge of everything.

I have a lot of the data that I had before, but. I know how to look at things differently every time because I know, well, what's old is new again. 

Nancy: Yeah.

Darcy: It's usually with some twist. 

Nancy: With a twist, right? 

Darcy: right, right. So you have to be able to anticipate that. 

Nancy: What advice would you give young people who are listening?

Darcy: [00:55:00] Look, the thing that I like the best is that almost probably 75% of the people that I've trained at some point in my career, at some point reach out and go, you gave me the best training I ever had. And it's really extraordinary over like some decently big names. Yeah. You know, one who happens to be the president of SAVIS right now, she is, but really don't look for immediate gratification because if you do, it may build up your image of yourself to the point that you can't listen when you should be listening for constructive feedback.

So what I'm trying to say is just do as much as you can and then more. And don't be like, well, the person over there isn't, you know, isn't working as hard as I am. It doesn't matter, right? This is about what you can do, what you can learn, volunteer constantly. Can I do more? [00:56:00]  Can I do more? And if it doesn't come home in your paycheck that year, it'll come home in your career within three to five.

Nancy: Yep. That's great advice. Any book or a TV show you'd like to recommend?  

Darcy: You know, it's so funny, I read books like I just blow through them. I'm, I'm a big, fantasy reader, so I can't even remember the names. And TV shows, probably not really. I am, probably watch more golf than anything else.

My husband loves watching golf. He's also a huge open swimmer, well open water swimmer, so. 

Nancy: Really? 

Darcy: Yes. 

Nancy: Wow, that's fun. 

Darcy: Yeah. No, it's been fun. We've taken some really cool trips. We're gonna go to Malawi, next with his two other swim partners and that'll, that'll be their seventh still water. 

Nancy: Is that Indian Ocean?

Darcy: No, that's in Africa. 

Nancy: No, but I mean, what? No, no, it is the Indian Ocean of the Atlantic side. 

Darcy: No, it's Lake Malawi. 

Nancy: Oh, it's Lake Malawi. Okay. So, it's on the coast. Okay. So 

Darcy: All he [00:57:00] has to worry about are hippos, crocodiles. 

Nancy: Oh, horrible. 

Darcy: And those little bugs that swim up your ear race rock, like, sounds like fun.

Nancy: I wouldn't, I wouldn't even go in a canoe when I was like, you know, around the hippos. But we, when we're in South Africa, we have a lot of family members who swim in, you know, there's so literally in, you're in Cape Town, one side of Cape Town's, the Atlantic Ocean, the other side's. The Indian Ocean.

The Atlantic ocean's freaking freezing. Right. And it's like in the fifties, low fifties. And we have, and sometimes below, and we have family members who swim like one or two miles every weekend in that water. 

Darcy: Chris goes in Long Island sound when it's 40 degrees. No wetsuit. 

Nancy: Yeah. Well. I could see, I, I can get it doing it for a couple of minutes, but you know, these, these long distance swims, I'm not sure so sure about, but good for him.

Yes. Well, Darcy, such a pleasure to have you. Thank you so much. 

Darcy: Thank you. 

Nancy: Really appreciate it. 

Darcy: Thank you. This was a lot of fun. Appreciate it. 

Nancy: Great. [00:58:00] I hope you enjoyed this episode of Real Estate Capital. Before you go, I have a quick favor to ask. We've put a lot of thought and effort into this show in making sure we bring you insights from real estate leaders that you don't normally find in the mainstream media.

So if you're enjoying this show, please remember to follow it on your favorite podcasting app so you never miss an episode. We'd also love for you to share it with others or give us a review on Apple Podcasts so others can find us. Thanks again for tuning in. For more information about our firm, please visit our website@parkmadisonpartners.com.