‘Tis the season…to cut back. The annual holiday party, New York real estate’s holiest of holies, is under threat.
After years of trying to outdo each other with ostentatious blowouts and fêtes in some of the city’s glitziest spaces, many firms have decided not to host parties this year. If they are doing them, it’s on a far more spartan scale.
Take Town Residential. The residential brokerage acquired a reputation for hosting some of the most raucous parties of the year, at venues such as Tao Downtown and Tavern on the Green. But this year, it is opting out of a big bash, and will instead confine the festivities to smaller gatherings at individual offices.
Town’s CEO Andrew Heiberger said the decision was a nod to the struggling market.
“Retail got formally destroyed this year,” he said. “The hotel market is in distress. Luxury sales above $4 million are way off and the high-end rental market is frozen with the exception of some prime, prime pockets. I just didn’t think that throwing a gala-sized party this year was consistent with the market, even though a lot of good brokers had really good years.”
And there are others. Joseph McMillan’s DDG Development hosted one of the more buzzed-about parties of the circuit, a classy affair at the Whitney Museum with a live band, gift bags for attendees and private tours of special museum exhibits. This year, DDG is keeping things employees-only.
From a foodie’s perspective, JDS Development Group’s annual party at Morimoto was a culinary treat. This year, Michael Stern’s firm is doing a staff-and-families affair.
And Moinian Group, which threw a celebration at Espace complete with live band and tequila tasting, isn’t doing a party this year.
Scenes from the Moinian Group’s party last year
“They are just keeping things simple this year,” a spokesperson for the developer said.
With the rise of several new venture-backed players, many firms are focused on employee retention, and may be seeing more value in focusing on their agents and staff rather than putting on a show, sources said. The market isn’t quite what it used to be, and some cited the optics of shelling out several hundred thousand dollars on a lavish event when the industry is struggling.
Manhattan investment-sales volume totalled $14.37 billion for the first three quarters of 2017 — a 54.6 percent year-over-year drop that puts the borough on track to finish the year below 2008 levels, according to data from Cushman & Wakefield. As for residential sales, the median price of a new development condo dropped 23 percent to $2.8 million during the third quarter, according to appraisal firm Miller Samuel. Time on market jumped 65 percent to 264 days.
Michael Stern and Joe McMillan at JDS’ party last year
But even given the slowdown, it’s an unusual situation, the first year since the market recovered that so few parties are on the roster. Then again, employers are navigating a charged new reality in the wake of the Harvey Weinstein scandal and other blockbuster claims of sexual harassment. Real estate bosses may be looking to play defense and avoid potentially messy situations.
To avoid alcohol-fueled parties getting out of hand, 11 percent of employers are canceling holiday parties this year, according to a new survey from employment consulting firm Challenger, Gray & Christmas. The number of firms serving alcohol is expected to drop to 49.7 percent from 62 percent, while others are limiting how much partygoers can consume.
So far, it’s unclear if any real estate firms are among them. “It’s probably well-advised,” said one real estate public relations executive.
See highlights from the 2017 holiday parties
One segment of the market that’s actively rethinking the party scene, though, is title insurance, where firms were notorious for going all-out (parties in previous years included scantily-clad waitresses, booze-filled tables on one side and kosher treats on the other). But sources said that partly as a result of new regulations passed by state regulators that seek to crack down on inducements, they too are dialing back. Kensington Vanguard, for one, isn’t doing a big bash this year, after several years of filling the Ainsworth in Gramercy Park, sources said.
Not all companies subscribe to the more monastic approach. Anyone who attended Madison Realty Capital’s exuberant fiesta at the Top of the Standard could be forgiven for thinking we’re still in a market where record-breaking deals are happening on the regular.
And Sciame, the general contracting firm, plans to host its annual holiday party per usual at the Morgan Library on Dec. 14.
“We make it a point, every year, to invite all our clients to our party to thank them for their business,” said Frank Sciame. (The company will host a separate get-together for staff and their significant others after New Year’s.)
Sciame said the firm is fortunate to have had a busy year, but it throws a large holiday party regardless as a way to thank clients.
“We had this party in 2008,” he said. “We almost consider this like a fixed expense.”
Janeen Saltman, founder of JKS Events, said there’s no question that firms don’t throw parties the way they did prior to 2008. “Their marketing dollars are really stretched throughout the year so they allot a certain amount of money to their holiday event and they’re really sticking to it,” she said. “They’re not going above and beyond.”
Heiberger said throwing seven parties — instead of one big bash for 1,000 people — isn’t necessarily a money saver. “We’re not doing office parties with red Solo cups and BYOB,” he said. Town is hosting events at venues like the St. Regis and Public hotels, the Stanton Social and Mamo. An upside of more “intimate” events is spending quality time with brokers, clients and customers, he said.
But he hasn’t quite given up on the signature Town blowout. “Next year,” he said, “I’m hopeful we can throw a Cirque du Soleil.”