Many real estate professionals have at least some familiarity with The Durst Organization. The organization is one of the oldest and perhaps most successful family-run commercial and residential real estate firms in New York City. Founded in 1915, the company is owned and operated by the third generation of the Durst family, and Forbes magazine estimates the family’s fortune is $8.1 billion. The family-run real estate empire owns, manages, and operates a 13 million-square-foot office portfolio in NYC, along with nearly 3,500 residential rental units.
There’s much more to the Durst family than the infamous Robert Durst, who quit the family business in 1992 after Seymour (who died in 1995) picked Douglas, the current chairman, to run the company. The Durst Organization’s business model since the 1950s has been based on assembling building sites, completing them, and owning them. And they own some excellent trophy buildings in New York City.
The Condé Nast building at 4 Times Square was finished in 2000 and is one of the organization’s development projects that remains in its portfolio. Another high-profile project is One Bryant Park, also known as the Bank of America Tower, which was finished in 2010 and is now home to the company’s headquarters. But the Durst Organization’s most significant project in recent memory is One World Trade Center, which it developed along with the Port Authority of New York and New Jersey.
Rags to riches
The founding of the Durst real estate empire is also a classic rags-to-riches American immigrant story. The family patriarch, Joseph Durst, was a Jewish immigrant who arrived in the U.S. in 1902 from a part of the Austro-Hungarian Empire that’s present-day Poland. As legend has it, Joseph had three dollars to his name, spoke no English, and had zero connections when he got to America, but quickly found work in New York City as a tailor. In 1912, the resourceful Joseph Durst became a full partner in a dress manufacturer.
Joseph used the profits from the business to acquire his first building in 1915, The Century Building at One West 34th Street. The rest, they say, is history. By 1927, he had formed the Durst Organization, and by the 1950s, the firm shifted from primarily real estate management to construction and development. Joseph Durst died on New Years’ Eve, 1973, and his son, Seymour, took control of the company.
The Durst Organization has always had a laser-like focus on New York City real estate, and with each generation, the family business grows. Douglas Durst is the organization’s current chairman, and his brother, Jonathan “Jody,” is the president. Douglas resigned as co-president in 2009, remaining as chairman but ceding day-to-day operations to Jonathan.
The family is currently grooming the fourth generation of real estate moguls, including Douglas’ daughter, Helena, who serves as a principal; his son, Alexander, who serves as Principal and Chief Development Officer; and a cousin, David Neil, who serves as Chief Administrative Officer of the Leasing & Marketing Division. Kristoffer Durst is Douglas’ cousin and Jonathan’s brother, and he serves as a Senior Vice President.
Many professionals in the real estate industry have deep respect for the Durst family. “I can’t think of another U.S. real estate family that has lasted four generations and seen that kind of trajectory of growth,” Mary Ann Tighe, a CBRE executive, told the New York Times in 2015. “They usually don’t have partners. It’s their own money they put at risk.”
Despite its immense wealth and influence, the family keeps a relatively modest profile. The Durst family doesn’t display its name on museums, hospitals, or university buildings despite its philanthropic efforts, which are notable. The Durst family is among the founders of the Stephen Wise Free Synagogue, and they contribute considerably to the New School and the Trust for Public Land.
A foray into Philly
Because of the Dursts’ focus on New York City real estate, a recent development project outside of the Big Apple has raised some eyebrows. In September 2020, the Durst Organization’s $2.2 billion riverfront redevelopment plan in Philadelphia beat out a competing proposal by the city’s professional basketball team, the Philadelphia 76ers. The 12-tower, mixed-use project is Durst’s first deal outside New York City in the firm’s long, storied history.
The redevelopment project includes a total of 3.5 million square feet of new mixed-use space. The north site will have 1,800 residential units and 94,000 square feet of office space, and the project will also include a supermarket, a preschool, and other retail areas. The south site will consist of six smaller towers and 550 residential units with 26,500 square feet of commercial real estate space. Durst’s development was planned in various phases over nine years, and the firm’s bid was the only one of the four that didn’t require tax breaks or public subsidies. The fact that no tax breaks were needed apparently contributed heavily to the Durst Organization winning the bid.
When the winning bid for the redevelopment project was announced, the bigger story in Philadelphia was that the Sixers had lost (we in Philadelphia are used to the Sixers coming up short). Philly fans love basketball, but the proposal for the Sixers’ stadium was also unpopular among many city residents. The Durst Organization’s vision for Penn’s Landing is good news for Philly, a project to re-imagine the waterfront area along the Delaware River that separates the city from New Jersey. It’s the first significant master plan for the area since Simon Property Group’s failed grand vision of an entertainment and retail hub with a sky tram to Camden, New Jersey, in the early 2000s.
The Durst proposal was developed after wide-ranging community input from Philly neighborhood groups and politicians. “The Durst Organization’s thoughtful proposal prioritized minority participation and economic impact, without the need for a taxpayer subsidy,” Philadelphia Mayor Jim Kenney said. “This is a very large-scale project that will greatly impact the waterfront for years to come.”
Durst’s plan will not only not rely on tax breaks, but it will also give back to the Philly community in several ways. In the bid, the organization committed to contributing payments to the city’s Housing Trust Fund, enabling the renovation of existing affordable housing and the construction of new homes for lower-income residents. The proposal also contains an equity stake of up to 20 percent of the potential development to Minority Business Enterprise partners and commitments to hiring minorities and locals for the development’s construction.
From the sound of it, the Durst Organization has big ambitions in Philadelphia. Earlier in 2020, the firm finalized the purchase of a 1.6-acre parcel for another mixed-use development. The company also owns leases for a set of piers along the Delaware River. “Our goal is to build off investments in Penn’s Landing Park, Race Street Pier, and Spruce Street Harbor Park to transform the river into a gateway to Philadelphia while increasing economic opportunities for the entire city,” said Jonathan Durst, president of the Organization.
The announcement of the project has made a splash in the Philly real estate market. The Delaware River waterfront has been an area of the city with great potential for a long time, but it’s been prone to fits and starts development-wise, to put it mildly. Grandiose development plans along the waterfront have been promoted and scrapped for decades, going back at least to 1973.
Most of the waterfront area has some nice attractions now, but it’s generally underdeveloped and car-centric. Columbus Boulevard is a six-lane thoroughfare along the waterfront with dangerous, racing traffic that hasn’t helped matters. Durst’s vision is refreshing, and they seem to have the expertise and experience to pull off such a large project, though some cynical Philly residents may be waiting for it to actually materialize before they believe it.
What’s the next chapter?
So, is the win for Philadelphia a win for the Durst Organization, too? It remains to be seen as the redevelopment project in the City of Brotherly Love will play out over the next nine years. What’s more intriguing is that the Durst family has stepped outside the confines of New York City to undertake a significant project in another metro area, albeit one very close to home for them. Some real estate observers wonder if this could be a sign of things to come for the Durst Organization, which has historically always stayed in and around Manhattan.
The Durst Organization declined to comment, so whether or not they have aspirations in other U.S. cities is speculation for now. But it’s interesting to note that a new generation of the family could be coming to the helm soon and bringing new ideas to the firm, including perhaps stepping outside New York. Douglas Durst, 77, is still very active with the family business, and so is Jonathan, 66, who oversees the day-to-day operations and started at the firm in 1984. But with the fourth generation of the Durst family coming of age in the family business, it’ll be interesting to see what new strategies they bring to the table.
It also may be the case that the Durst Organization is frustrated with New York City, like some other real estate firms, and wants to test other markets. Compared to other U.S. cities, NYC has been slower to recover from the pandemic. In July, the U.S. officially recovered all the jobs lost during the pandemic, but NYC still has regained only 82 percent. Many people, including Durst, probably have faith that New York will rebound in a big way, but it doesn’t hurt to diversify a real estate portfolio in terms of locations.
In contrast, a city like Philadelphia is currently beating out New York by some indicators. Philly astoundingly permitted more residential units than New York City in 2021 for the first time in recent memory, according to the U.S. Department of Housing and Urban Development. The number of completed residences in Philly in the next two to three years will still likely shatter records even if more than half the units that were permitted in 2021 don’t get built. Housing is much more affordable in Philly compared to high-cost places like Manhattan, Washington, D.C., and San Francisco. And while Philadelphia central business district offices are struggling with vacancies much like New York’s, residential neighborhoods are thriving. For-sale housing has been scarce in Philly’s suburbs, so many urban homeowners have chosen to stay put and enjoy multiple transit options and the restaurants, bars, universities, and other amenities the city has to offer.
But if the Durst Organization decides to jump deeper into the Philly real estate market, they’ll soon discover the city’s flaws, too, including a very high rate of homicides and gun violence, a stubbornly high poverty rate, and a regulatory landscape that’s been described by many as overly burdensome. A report from 2020 ranked Philly 71st out of 80 among U.S. cities in the ease of doing business, and the city’s annual job growth in the decade after the 2008 financial crisis was slower than the national average.
Testing out the Philadelphia real estate market brings opportunities and challenges for the Durst Organization. And it will also bring the chance to interact with a different cast of characters as far as developers, other real estate firms, and elected officials. The relations between Durst and Philly elected officials seem great now, but we’ll see how long that lasts.
The city has recently moved to exert more control on commercial real estate development, as voters in the spring approved a ballot question that’ll significantly change how the city’s zoning board operates. One of these changes gives more control to the Philly City Council, which has already led to moves like mandatory inclusionary zoning in two districts. Trading favors for zoning or land decisions was also front-and-center in a notable federal corruption case against city Councilmember Kenyatta Johnson, although it was declared a mistrial in April.
The foray into the Philadelphia real estate market could be a one-time thing or a foreshadowing of the Durst Organization’s new strategy. Whatever the case, the family business is likely in good hands. The Durst real estate empire had the humblest of beginnings and has survived and thrived for more than a century in the rough and tumble world of New York City real estate, which is no small feat. A fourth generation of the Durst dynasty is getting closer to taking the helm, and that could mean some changes are on the way. While washing away the stain from the legacy of the bad apple heir, Robert, may never happen, the Durst family has accomplished enough to gain the respect and admiration of many in the commercial real estate world. Whatever the organization’s next chapter is, real estate professionals will be watching.