Page 62 - How To Get Rich

How To Get Rich

I was leery of their recommendation because the cost of residential

conversion was high, plus the five floors occupied by a law firm would
have to be bought out for megabucks and that would screw up any
construction timetable. My instincts told me the building could become
the prime office location it once had been, and that there had to be a way
to make it work.
I asked George Ross to see whether he could devise a workable

scenario, and he came up with an interesting new approach. He suggested
we envision the 1.3-million-square-foot building as three separate
structures on top of each other:
•
The top 400,000-square-foot tower had small floors with spectacular
views, and he was convinced it would quickly be rented to boutique
tenants who would pay higher rent for the prestige of being a full-floor

user on a high floor.
•
The middle 300,000 square feet could be rented for less per square
foot, but those rents would still more than cover the purchase price and the
cost of renovation.

•
The bottom 400,000 square feet might be tougher to rent, but even if
those floors were completely empty, the building would still be profitable,
assuming our projections about renting the top 700,000 square feet were
correct.
Emboldened by George’s plan, I discarded the idea of residential
conversion and relied on our construction expertise to turn 40 Wall Street
into a successful office building. We redesigned and modernized the lobby

and building systems, and when the rental market improved, we were
ready. Now, the building is worth hundreds of times what I paid for it.
I guess my instincts were right.

Know Exactly What You Want and Keep It to Yourself