Still, Barnett has hit a rough patch in recent months. A few days before we spoke, he had turned over a deed on a parcel on Tenth Avenue at 30th Street, where he had envisioned building a hotel. “It was a tough decision,” he said. “I wasn’t happy about it at all. That project wasn’t viable in today’s market.”
Several of his recent projects have hit sales snags. At the Rushmore, a luxury condo on the Upper West Side, he’s embroiled in a bitter legal dispute with a group of 41 buyers. Some brokers who deal with Extell bristle at Barnett’s hard-knuckle tactics. “He’s tough as nails,” says Upper East Side broker Larry Kaiser. “The brokerage community, whether you like it or not, can make you or break you. His relationship with the brokerage is controversial.”
In the diamond district, Barnett is ensnared in a turf war with the owners of 580 Fifth Avenue over his plans to build a Skidmore, Owings & Merrill–designed office tower. Barnett has stumbled with the project. Though it was conceived as a 750,000-square-foot tower for diamond and gem companies, Barnett has so far not managed to get enough tenants to get a construction loan. Kenneth Kahn, a part owner of 580 Fifth Avenue, on the corner of 47th Street, has blasted the city and state for extending financial incentives to Barnett, essentially arguing that they’re subsidizing his investment at the district’s expense. “He was trying to get the city to almost pay for it,” Kahn says. Tensions between Kahn and Barnett were ratcheted up after Barnett poached Kahn’s tenants. “He’s making them real-estate deals they can’t refuse!” Barnett, not surprisingly, believes it’s all fair play. A few months ago, he even approached Kahn about buying 580 Fifth Avenue and converting it into a hotel and condo, but Kahn turned down the offer.
Barnett says he’s just trying to get the tower built and get out without too much damage to his finances. “God willing, we’re going to rescue our money.”
Given his meteoric rise, many in the real-estate world wonder if Barnett is creating a global firm like Tishman Speyer or Related. That seems unlikely, because Barnett insists on controlling every aspect of the development, from the financing to the choice of marble counter space, so the company will always be essentially his operation. He chuckled when I asked if he sees himself as part of the Establishment. “I don’t think of myself as a macher,” he said.
But machers are definitely paying attention. “A lot of guys, I call them the Rendering Boys,” says Trump. “They come in with renderings. They’re always showing renderings but never get them built. He gets them built.”