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But wait: There may be hope for city residents who want to free themselves from the oppressive tyranny of New York's supers. A new Web site, Edifice Rex, allows residents of buildings across Manhattan to check for packages, see who's manning the door, and -- most important -- place work orders or service requests, all without having to call the super and wait for him to get back in touch. "The concept of plausible deniability no longer exists," says Andrew Farkas, CEO of EdificeRex.com Inc. as well as its parent, Insignia Financial Group Inc. As head of Insignia -- the largest residential real estate management company in New York -- Farkas had heard for years the complaints and concerns of residents of the buildings his company oversaw. And that gave him the idea for Edifice Rex: A spot on the Web where residents could go to keep in touch with others in their building and communicate with the super. On top of that, Farkas wanted to add content about entertainment and shopping in the immediate vicinity of the building. Want to know where to find the closest pizza joint? Edifice Rex gives you the address, then draws you a map. Need a dry cleaner? Look to Edifice Rex. "We wanted to make a highly localized, building-specific Internet portal," says the 39-year-old Farkas. PRIME PROPERTY. And there's more. Edifice Rex features reviews of restaurants, plays, and movies, columns by haughty, bratty, and witty New York pundits such as novelist Tama Janowitz and Warhol acolyte Brigid Berlin, and an auction for Friday- and Saturday-evening reservations at trendy restaurants such as Lespinasse, Daniel, and Asia de Cuba. Winning bids have averaged $60, Farkas says, but all that buys is the table. Dinner is extra, while proceeds from the bidding go to charity. What Farkas has delivered with Edifice Rex, analysts say, is a clever way to capture the attention of a highly desirable demographic group: The superrich people who can afford to buy condominiums and cooperative apartments in Manhattan. So far, buildings with a total of 65,000 apartments have signed up for the service, and an additional 25,000 units' worth are mulling it over. "What we're talking about is the occupants of buildings in some of the most expensive real estate in the world," says Lehman Brothers real estate analyst David B. Harris. While Edifice Rex claims to accept no advertising, the site has dozens of links that look suspiciously like ads. These "affinity partners" give Edifice Rex a 5% to 10% cut of any sales that are generated by the site. Farkas has even bigger plans. He's gearing up to roll out Edifice Rex in a half-dozen other U.S. cities and London this year. And he's developing a version of the site for commercial buildings. While Farkas seems to have the residential-building portal market to himself, he says he expects plenty of competitors in coming years. And outside of Insignia's Manhattan stronghold, Farkas may have a harder time, says Banc of America Securities analyst William Marks. "The company has a very strong competitive advantage in New York, but it might not have that advantage in other cities," Marks says. NEEDS RENOVATION? In the commercial space, Farkas already has company. At least three other groups are working to offer similar portal services to office buildings around the U.S. Farkas counters that he's already got buildings with roughly 300 million square feet of floor space -- the equivalent of more than 130 Empire State Buildings -- waiting in the wings. "It's that scale that will give us leverage," Farkas says. So far, what Edifice Rex has leveraged is Insignia's share price. Throughout 1999, Insignia stock fell by half while the broader market was soaring. But early this year, when the company announced its Internet strategy, the shares jumped from $7 to more than $15, although they've since retreated to around $11 as the broader market has declined. Last month, Insignia sold a 13% stake in Edifice Rex for $35 million in a private placement, which effectively gave the Web unit a value of $265 million -- or $6 per Insignia share. That means shareholders can own the rest of Insignia's operations for just $5 per share -- a "laughably low" price, Marks says. For tenants and supers, meanwhile, the value should be in the Web site -- and some say it still needs improvement. Steve Eisenberg, a business-development manager at Sinclair Broadcast Group, says he checks the page for his Gramercy Park condo once or twice a week but would like to see more content related specifically to his building. "They're trying hard, but I think they've got to do a better job of driving people to the site," Eisenberg says. Eisenberg and others do say Edifice Rex is likely to make New York's notorious supers more responsive. Edifice Rex gives each building that signs on a free PC and trains the supers in how to use the computer and the site's messaging capabilities. Jack Timlin, who oversees supers at eight Upper West Side buildings, says about a quarter of work orders come in via e-mail now -- which makes it easier to ensure that the work gets done on time. "Once it's documented and on a screen, the super has to respond to it somehow," Timlin says. And for the residents, that has to be a powerful feeling. Rocks covers the computer industry for Business Week and is the superintendent of his own domicile |
