Jerry Gottesman literally can trace his company’s origins with a No. 2 pencil.
As he sits in his office in the nondescript, two-story walkup building in Newark that serves as Edison Properties’ headquarters, with a color-coded map on the table in front of him, he gives a history lesson.
He stares down at the map, which shows the parcels his firm has amassed around the city’s downtown, and points to a block on Edison Place that sits just east of Newark Penn Station.
“The first lot that my father bought was about this much,” Gottesman said, using the pencil to shade roughly a third of the block. “That’s where we started in business, and then gradually we acquired all of these other properties.”
The sites are mostly parking lots, as they have been for decades.
The business model, however, finally may be changing.
After 60 years in business, Gottesman is ready to preside over a dramatic transformation of his footprint in Newark, under a long-awaited plan to create a vibrant, mixed-use neighborhood and park space between the train station and the Prudential Center.
The plans, anchored by what would be known as Triangle Park, are closer than ever to getting started after roughly a decade of delays. Gottesman’s firm was among those involved a complicated land swap and redevelopment agreement that gave way to the Prudential Center, with Edison having owned roughly half of the land on which the arena now sits.
The swap was never completed, and Edison never received all of the parcels it was owed under an agreement with the city, even as The Rock opened in 2007. That meant the sites needed for Triangle Park and the accompanying development were never fully formed.
“It’s very hard to get really complicated things done,” Gottesman said. “And as it happens, we own a bunch of the real estate, but it isn’t only the real estate you’re dealing with.”
But things started to change when Newark Mayor Ras Baraka took office in 2014 and sought to complete the deal, stakeholders said, giving way to an announcement in March that an agreement had been reached.
Tom Banker, a consultant for Edison Properties, said the final closing and transfer of ownership for the parcels could take place as soon as this month.
“For the first time, each of the designated developers will control their own destiny in terms of being able to move forward in the use of the property and the implementation of whatever their various development plans are,” Banker said.
The breakdown includes six sites owned by Gottesman that are slated for more than 400,000 square feet of mixed-use development around the park. In the meantime, the city is in the process of retaining a design consultant for the park and a 1/2-mile-long footbridge connecting the Ironbound district to the blocks west of McCarter Highway.
And even if the project is more than a decade in the making, those years account for only a fraction of the Gottesman lore. The 85-year-old is best-known for his regional empire of parking lots and self-storage facilities — and perhaps even legendary for having the will and the patience to hold onto his property for one cycle after another.
“My basic feeling is, if I can carry a property either in parking or in self-storage, in the long run, it will be a great benefit to my family,” Gottesman said. “We’re a family-owned business and I truly believe in creating high-quality facilities. … It’s proved to be successful in Newark and it certainly has worked in New York, and it even works in Baltimore and Jersey City.”
Gottesman recounted his career and company history in a rare public appearance in March, in which he spoke to the advisory board of the Rutgers Business School Center for Real Estate, and in a follow-up interview granted to NJBIZ. He also touched on the future of downtown Newark, which he believes is now on the verge of being the destination that its supporters have long hoped for.
Ironically, the Edison Properties story begins with a building that was torn down to make way for a parking lot.
The company’s first lot on Edison Place began as “an old wooden factory building” that his father had acquired in 1956 with the intention of relocating his nearby sewing factory. Instead, he opted to demolish the building and open a parking lot behind Newark Penn Station, recruiting his sons Jerry and Harold to operate the business.
The path to success
You can call it resourcefulness, gumption or any other word to describe the get-up-and-go spirit. Or you can call it being “an eager beaver,” as Jerry Gottesman does when he reflects on his career.
Whatever it was, it was a key part of helping him build the Edison Properties empire.
Like in the very early years, when Edison had to contend with being the last of four parking operators on a busy stretch of West 44th Street in Manhattan. Competition was fierce, Gottesman recalls, so he found something to get a leg up.
“I was single at the time, and I tried to get there at theater time and I’d climb up on the roof of the booth,” he said. “I was the flag man, but instead of being the flag man on the sidewalk, I was the flag man up on top of the booth — everybody noticed me.”
“When you’re trying to make a living and you don’t have any money, that’s the kind of stuff you do.”
Gottesman tells the stories with a smile, enjoying the chance to revisit the hijinks and savvy business moves that helped attract customers. He recalls befriending Gerald Schoenfeld, the powerful chairman of the Shubert Organization, and securing a deal to advertise his parking lots on ticket envelopes and offer discounts to theater goers.
That’s not to mention sneaking into garages to inspect their designs, and securing introductions to movers and shakers who owned facilities around Newark and Manhattan.
“It’s the old story of American energy and having the desire to be a successful company,” Gottesman said. “That’s all.”
The brothers, who had just come out of the Air Force, had no experience in real estate or parking cars. But Gottesman said he “ran around town putting circulars on windshields to get cars into that lot for 50 cents a day,” an example of the resourcefulness that would help define his career.
When they figured out they couldn’t make a living from just one parking lot, Gottesman pounded the pavement once again. He crisscrossed Newark and “met a whole bunch of people in the real estate business,” finding opportunities to lease and manage other landlords’ parking lots.
Within about two years, Edison was operating more than a half-dozen of them.
That included a facility opened by Prudential Financial in the late 1950s, an assignment that he believes opened more than a few doors for Edison Properties.
“We were chosen by Prudential to run their garage, and I can assure you I ran all around New York and Newark, and every real estate man I came in contact with, I said, ‘Prudential chose us to run their garage.’” Gottesman recalled. “And that’s kind of what put us on the map.
“I milked it for all it’s worth.”
That helped the company expand its holdings over the next decade in New Jersey and New York City. The brothers also relied on their ability to help landlords and architects design new garages and improve the efficiency of existing ones, Gottesman said, noting that “we were both reasonably technically inclined.”
That skill ultimately allowed them to land business in places such as Rockefeller Center — and then take their enterprise well beyond the tristate area in ensuing decades. At one time, they managed about a hundred facilities around the country.
“It was a very competitive business, but I prided myself on being a pretty good salesman because I understood parking.”
Gottesman notes that “we didn’t have any money” during the early years.
He said it was due largely to the difficulty of turning a profit though leasing and management contracts. That forced him to seek acquisition opportunities, such as the 600-space garage in the Hippodrome Building, a skyscraper on Sixth Avenue between 43rd and 44th streets in Manhattan.
He came upon the building in the late 1970s and saw a long line of cars waiting to enter, and “as luck would have it, I snuck into the garage when nobody was watching” to determine if he could improve the efficiency of the facility. It turned out he could, he said. And that resulted in a much bigger opportunity than expected.
“In the end, we bought the whole building, not just the garage,” Gottesman said. “But we were able to buy this 500,000-square-foot office building on the strength of the fact that we knew how to increase the net revenue from the garage by about a million dollars a year, because that’s how many attendants we cut out by letting the customers drive instead of having the attendants drive.”
In the years leading up to that acquisition, Edison had been expanding by moving into the self-storage business, an idea he got while driving home through Norfolk, Virginia, in the mid-1970s. It is now the biggest piece of Gottesman’s business, known today as Manhattan Mini Storage, which the firm has built by retrofitting existing properties.
“We were the first in Manhattan and we capitalized on that market,” Gottesman said. “It’s now our biggest business, and we still try to dominate the storage business in Manhattan.”
Today, Edison’s portfolio includes more than 3 million square feet of buildings and several million square feet of land. It has still only dabbled in ground-up development — such as the construction a decade ago of a 23-story, 243-unit apartment building on Ludlow Street in Manhattan — but it has always assembled sites that it would operate as parking or self-storage until the market was right to build or sell.
Those properties include several blocks around what was a defunct elevated rail line along the West Side of Manhattan, which has since become the popular 1.45-mile-long public park known as the High Line. Edison recently fetched $870 million for one of its parking lots in the area — perhaps the ultimate validation of its strategy — but it’s the strength of the attraction that helps Gottesman envision a similar destination in Newark.
Specifically, he points to the footbridge that would connect the Ironbound to the downtown and the neighborhood around the Prudential Center.
“I think that having a pedestrian route that doesn’t force you to walk through Penn Station, or worse yet, force you to walk on Market Street or Edison Place, will be a great benefit to the core area of Newark,” Gottesman said, later adding: “Triangle Park could be a very important exciting thing as the center of activity in Newark.”
It was early March when Baraka announced that the city “had the opportunity to take the ball over the finish line” for its highly touted Triangle Park project. A week later, Gottesman was speaking directly to industry leaders in his appearance before the Rutgers Center for Real Estate.
It was by no means intended to be a victory lap — the event at the Newark Museum had been in the works for some time. Rather, Gottesman said he accepted the invitation because he viewed it as a way to further his longstanding goal of helping the city by rallying its business leaders.
“I’m trying to make the Newark business community into a real dynamic place, because one hand feeds the other, and the more people are interested, the easier it is to accomplish things for the real estate owners, the retailers,” Gottesman told NJBIZ later. “The more the merrier, so if you’re in the business, it feeds on itself.”
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