Stephanie Blake, CEO of Skylight Studios, and Hiten Samtani of The Real Deal (photo of Blake by Allan Zepeda)
Legendary real estate investor Harry Helmsley was especially proud to find what he called “romance” in a property: the parts of it that could be managed more efficiently, thereby reducing expenses and increasing profits.
Stephanie Blake, too, seeks romance. But his quest is less about spotting leaking boilers and more about identifying elements of a building that could stir the blood of some of the world’s most iconic brands.
Her company, Skylight Studios, is a combination of historian, consensus seeker, urban anthropologist and glitzy, celebrity-strewn event management company. He works with some of the country’s largest landlords and developers, including Vornado Realty Trust, Brookfield, L&L Holding and Atlas Capital Group, taking their unused or underused real estate and
offer it to brands and content studios for events, installations and immersive experiences.
Skylight projects include
Moynihan Station and St. John’s Terminal, both of which have hosted events for New York Fashion Week; 23 Wall Street, where Nike hosted an event for designer Virgil Abloh; and ROW DTLA, where the company brought in Netflix to create a “Stranger Things” production drive-through.
Blake sat down with
The real deal to discuss how uncovering a building’s history and personality can maximize its commercial appeal, the role that creating places can play in revitalizing real estate, and how cities can do creativity with their built environments.
VIDEO What is the creation of creative spaces and how does it apply to real estate?
It’s about making a place special, creating an identity. We were founded during the recession to energize properties and identify sources of income. If it’s vacant, pending rental, pending redevelopment, pending capital. It’s a non-traditional site development – you take underutilized warehouses on Manhattan’s West Side before it gets to the hot spot and bring Ralph Lauren from Bryant Park there to set up a private studio for Steven Meisel to shoot. his Louis Vuitton campaign.
The second piece is: How to energize and create the identity of a building, an asset, a neighborhood? Much of our work is about content, film, and photo, which creates location-based spaces. We do it with Steelworks off Lake Ontario. It is an 800 acre active steel fabrication plant.
It’s one thing to create buzz around a property. But how do you translate this buzz into commercial viability?
Decision-makers are changing on the tenant side. It’s not just your conversation with the real estate manager – it’s the marketing manager, the creative director, the employees who help make decisions about where they want to be. For us, it’s about presenting some of these assets to brands in an environment where they might not see it as just their traditional commercial lease. When we bring Hulu and they do something at the Ferry Building [in San Francisco], it’s this great art installation specially to launch “The Handmaid’s Tale”, all of a sudden it’s presented to Hulu in a new way.
We did this at ROW DTLA, working with Netflix to bring the first Covid drive-in experience. All of a sudden Netflix is on campus watching ROW in a different way. At St. John’s Terminal, we ran this campaign to launch Google Home. What happens next? All of a sudden, it was bought by Google for $ 2 billion. So there are a lot of transactions that occur, five or three years later, and present these properties to these big brands. There are a lot of ways to think about the model.
What role does Skylight play in bringing all parties to the table? Are you an evangelist, a historian, a city liaison?
The real estate side is very reluctant to make these punctuals. There is a ton of responsibility that can be involved in terms of presenting these types of shows without the right setting. And on the brand side, they’ve trusted our vision for a decade now. So what they understand is that they are not walking in a minefield. If you walked into Moynihan Station before the Penn District redevelopment, it had sat for 10 years. There is no electricity, there are cobwebs, there are birds flying through. Many brands work with us for their biggest events. They spend millions of dollars for 20 minutes on a parade. We have 45 page manuals of “here are all the ways we will help you make sure everything is transparent and flawless”. An owner does not have the capacity to do this.
I imagine there is a lot of rhetorical and political maneuvering involved.
We are a translator. The city and many economic engines understand that we will stimulate economic development. They trust the way we are able to develop a place. Whether it’s the Battery Park City Authority, whether it’s NYCEDC, we identify the point of intersection between their mission and that of the owner, as well as other businesses in a neighborhood. And then the mark was superimposed. Fashion Week, for example: bring it to Midtown for a
government project that languishes, there is no doubt that shaping it the right way can spark the right interest and spur development. I think of Vornado and Steve Roth, who were so frustrated with the pace of change at Farley’s post office. When you walk in there, he said, “spit on the ground.” Now we’re looking at a whole different landscape with Penn District, with Facebook. The next step, I imagine, is to weigh in on bigger issues, functioning almost like a development manager.
We are able to inform how and where the infrastructure should be, how you think about the common space, how a tenant interacts with the building. Our role is to consult the owner on his objectives, depending on the combination of tenants he is looking for or the type of industries he is looking to fill.
For SOEs, it can be difficult to justify Skylight’s activities as an item on their balance sheet.
Landlords know they need to play a bigger role in tenant success, whether it’s office and productivity or just retail and sales. It is more accepted to understand that there is an investment to encourage this. I was a history student. I enjoy it all, but I think it’s a question of how to make it practical and how it’s going to result in a higher price per square foot. It’s almost like having a starch – there is value in having something that is worth squeezing and has an energizing quality for an asset.
The San Francisco Ferry Building
Many large tech companies are looking to be their own owners,
spend billions acquire their real estate. What role do you play in such buildings?
It works much the same way. The education process is a little different because their end customer is themselves. There is more of an organic relationship between all the floors. When it comes to the [conventional] owner, there is a bit more of a lag in terms of how to monetize and how to make sense of the ground floor versus the upper floors.
How do you deal with the backlash from community spaces funded by the brand?
This is something that we are aware of when we try to create something that is sustainable for the community, by the community.
Often times there are a lot of existing entities that the community has already bought into, and you can find them a home and can generate value for your assets as well. So think about the value the Farmers’ Market has brought to the Ferry Building – we’ve been very good at identifying community organizations that are already accepted.
Are trading brokers like JLL and CBRE factored into what you do?
The conversation with them is over, “so what are the challenges with World Financial Center Marketing [Brookfield Place]? Who do you bring to the table? Who is the audience that you are not bringing to the table? We’re thinking about how we can take advantage of, for example, Heidi Klum and “Project Runway”, we can write some of those things in the script and create those moments where all of a sudden there’s more. [element to the building].
So how can Skylight drive traffic, attract that audience, and also help with the strategy, which isn’t just sending out floor plans and renders. What is this energy, what is the identity that you are building for this asset or for this neighborhood?
How do you bring your model to the rescue in Central Business Districts, faced with a
Existential crisis in the era of teleworking?
I think the idea of adaptive reuse is really interesting. It hasn’t been applied to office space, but there are ways to think about creative uses for it. With the
Chicago Chamber of Commerce Building over there in the central business district we entered a number of trading rooms that were in disuse.
We are still humans. We have to be in the physical environment. So I think [the evolution] will be driven by entertainment and culture and culinary. And there will always be value for transportation hubs, in those central areas where people enter a city.
You were lucky enough to work at 23 Wall Street, which is one of the great mysteries of New York real estate.
There isn’t much I can say, but what I
can let’s say everything you talked about regarding how it was built, the function it played in our history, is very valuable for different brands. The main activation we did there was with Nike and Virgil Abloh to create and have conversations about the future of fashion, create workshops for students to come in and design their own sneakers, have panels there- down there were installations of the art world meet the street scene.
There are a lot of challenges around this building – its location, but also the different elements of the property. But these brands are interested in historic and interesting buildings. It is an opportunity to celebrate the history, the ghosts and the magic of its creation and to integrate it into a 21st century identity. And I think there is potential there, but there are a lot of challenges.
This interview has been condensed and edited for clarity.
Write to Hiten Samtani at [email protected]. To learn more about The REInterview, a series of his in-depth conversations with real estate leaders and journalists, click here.