Most Recent Articles In Business Features
Latest Business Features Articles
- Chairman, CEO Discuss Future of the Roberto Cavalli Brand
- PayPal Has ‘Settling-Up’ Option for Group Gift-Giving
- Retail Losses From Out-of-stocks Grow
More Articles By
Last Wednesday morning, a small clique of New York’s reigning power players gathered in the Meatpacking District offices of Diane von Furstenberg for the type of breakfast meeting that shapes cities, literally and figuratively. Terry J. Lundgren of Macy’s and Lew Frankfort of Coach were there, along with Andrew Rosen of Theory, Vera Wang, Anna Wintour, Hearst Magazine’s Michael Clinton and the Council of Fashion Designers of America’s Steven Kolb.
Presiding over the elegant conclave was New York’s head macher-in-charge — at least for the next 37 days, Mayor Michael Bloomberg. He had brought along his cultural affairs commissioner, Kate Levin, as well as Daniel Doctoroff, chief executive officer of Bloomberg LP.
This story first appeared in the November 25, 2013 issue of WWD. Subscribe Today.
The high-powered powwow was engineered to discuss plans — and build support — for the Culture Shed, the ballyhooed arts center that is meant to become the new home of New York Fashion Week once it’s completed around 2017. The striking structure will serve as an anchor of the ambitious Hudson Yards development on the West Side of Manhattan, currently under construction and set to become a marquee capstone of Bloomberg’s 12-year tenure at City Hall, which comes to a close next month.
Bloomberg’s presence at the huddle and his lobbying to move fashion week to the Culture Shed — to which he has dedicated $50 million in city funds — were emblematic of the cozy relationship he has cultivated with certain factions of the fashion industry during his time as mayor. More broadly, through the city’s Economic Development Corporation, he has launched numerous initiatives to boost the fashion sector and he’s been front-and-center at countless industry events over the years, from kicking off the very first Fashion’s Night Out in a Queens mall with Michael Kors to rubbing elbows with Miley Cyrus at Fashion Group International’s most recent Night of Stars.
RELATED STORY: Michael Bloomberg — Man of Fashion >>
“Oscar de la Renta — who campaigned for me in the Dominican community three times in a row — he was at my house last night. He and his wife are very close personal friends,” recounted Bloomberg in a valedictory interview with WWD. “I have lots of friends in the fashion business. The guy who just retired from running Saks, Steve Sadove, is a really good guy. Terry Lundgren and his wife [Tina] are golfing partners of my girlfriend [Diana Taylor] and I. We will sit with them at the [Macy’s Thanksgiving Day] parade. But the night before, we will [see] all the balloons and then we always go out together to dinner and he brings his daughters along and I bring my daughters.”
As he talked, Bloomberg nibbled on what looked like potato chips that he had placed neatly in a small mound on a drab conference table, which was situated on a small stage overlooking his open-plan “bullpen” at City Hall. The mayor, with an estimated fortune of $31 billion, works here in a cramped cubicle amongst his top lieutenants, including all the deputy mayors of New York. An aide later insisted the alleged potato chips must have been some kind of healthy snack — no doubt without saturated fats.
Bloomberg’s embrace of the fashion industry is predicated on the personal and practical, economic and aesthetic, he explained. “Fashion has a number of things. One, there’s a business answer: $72 billion worth of [wholesale] business, it generates a couple of billion dollars worth of tax revenue, employs 180,000 people in the city,” rattled off the mayor. “Then there is the psychological contribution. People want to be in fashion. Not working in it, but to be au courant, if you will. They take great pride in it. They envision themselves. You see yourself in a woman’s magazine and you think that if you bought that dress you’ll look like her. No you won’t, I hate to break that to you, but nevertheless. So I think the fashion industry’s contribution — everyone focuses on the economics — but to me it has always been more that it provides the pizzazz and interest [to a city]. It’s like cultural institutions and parks — these are all things that differentiate a city from cement. And the fashion industry has done that. Fashion is an expression of culture.”
In at least that respect, even Paris has nothing on New York, in Bloomberg’s estimation. “We have 900 fashion houses here. Double the number of Paris,” he boasted — and that fashionable sheen to the hustle and bustle of New York is what attracts all sorts of people to this megalopolis, and keeps them here. “If we are ahead in fashion, that’s going to get a bunch of people to move here and stay here and who will then contribute in whatever their specialties are, whether it’s philanthropists that help or doctors who treat or businesspeople that create jobs or publishers that inform. It all fits together.”
Fashion is a crucial element in the life of the city, enmeshed with, and complementing, the worlds of finance, media, technology and diplomacy. Together they create the seductive complexion of New York that beckons strivers the world over. “In each of these industries, New York has some real advantages — scale. And if you are ahead in one, you help the others,” observed Bloomberg. “If intellectual capital is what your business needs to survive, or what turns you on in terms of day-to-day living, then New York is where you want to be. We aren’t the lowest-priced place, we aren’t the place with the greatest space, we aren’t the place that has the least regulation. But if you need the best and the brightest to work in your business, or to be your friends and neighbors, this is where it is.”
As the founder and former chief executive officer of the money-minting financial information firm Bloomberg LP, the mayor is especially sympathetic and attuned to the entrepreneurial spirit, said observers. Under his administration, New York has made a concerted effort to support new fashion businesses and attract talent here. In 2010, the city’s EDC launched an initiative under the banner “Fashion NYC 2020.” The effort includes a number of separate programs, with various partners, aimed at fostering fashion talent, in both design and management, and jump-starting independent fashion firms.
“The Economic Development Corporation, they deserve the real credit for all the economic stuff, reducing the impediments to get going and finding out how to get through the permitting process if you want to do a store — or connecting you to other people,” said Bloomberg of the city agency’s initiatives.
For example, the EDC’s “Fashion Campus” program, in partnership with Parsons The New School for Design, has drawn more than 550 participants to its educational forums over the past three years. In the “Fashion Draft” program, also operated with Parsons, 46 students have been selected from more than 500 applicants in the past two years to participate in high-level coaching through the recruitment process with leading New York-based fashion and retail companies.
Other components of Fashion NYC 2020 include the “Fashion Fellows” mentorship program for young professionals; “Design Entrepreneurs NYC,” which is a mini-MBA boot camp for independent fashion firms, and “Project Pop-Up,” a series of innovative, temporary retail concepts.
The EDC is close to unveiling a partnership with a financial firm that will launch its NYC Fashion Production Fund by the end of the year, said Eric Johnson, director of the EDC’s fashion and arts division. Seeded with $1 million from the EDC, matched by another $1 million from the corporate partner, the Fashion Production Fund will make loans of $50,000 to $300,000 to small designers to help cover the costs of fulfilling production orders. Those orders must be made by New York-based facilities, with the aim of growing young design businesses as well as the manufacturing base in the city.
“Especially under this administration, we have worked to come up with programs that aren’t just one-off fixes but rather an holistic, forward-looking strategy to help the fashion industry,” said Johnson.
Nurturing New York apparel makers is also the goal of the new Fashion Manufacturing Initiative, which was launched by the EDC and the CFDA in September. Spearheaded by Theory’s Rosen and with financial support from Ralph Lauren, Rag & Bone and Rue La La, the program will offer matching grants to factories that invest in upgraded equipment, new technology and worker training with the goal of modernizing New York’s production capabilities.
Additionally, the EDC is a partner with the CFDA in its Fashion Incubator program, which gives young designers a subsidized space to work from and professional development for two years to help grow their businesses. Bloomberg himself has visited the Incubator space in the Garment District.
For a former Republican and now Independent, Bloomberg has been largely protective of the zoning and regulations that protect apparel and accessories manufacturing in the “Special Garment Center District” on the West Side of Manhattan — although some observers say enforcement has been lax for area landlords that try to skirt the rules in order to bring in nonmanufacturing tenants. At one point, Bloomberg and the city considered amending the zoning laws, which led to protests in 2009 and 2010, with designers like Elie Tahari, Nanette Lepore and Yeohlee Teng taking to the streets along with public officials and garment workers. In the end, the city backed off and kept the laws, which date back to 1987, in place.
“You can’t just let unfettered capitalism decide who is going to use a piece of land. There are other things that you want to somehow or other include in it,” explained Bloomberg of his approach to zoning regulations. “If you don’t, you will not have certain industries here. Those seamstresses make Oscar de la Renta able to manufacture here and to be the fashion guru and to work with his customers. And if you didn’t, you’d start to see other places do that.”
He illustrated the point via his own wardrobe, opening his suit jacket to show off the label of Brooklyn’s own Martin Greenfield tailors, which operates in a 40,000-square-foot manufacturing facility in Bushwick that dates back more than 100 years. (It was previously the William P. Goldman suit company before Greenfield bought it in 1977 and changed the name.)
“I’ll tell you a great story,” said Bloomberg. “I get all my suits from [this] tailor in Brooklyn. Every suit. And they’re cheaper than Paul Stuart, where I used to get my clothing. [Bill] Clinton, Ray Kelly, Colin Powell, myself, Barack Obama, all get their suits there. You can get a cheaper suit, but my suits are all 10 years old. They last forever. I was out there the other day to get a new sport jacket and I come outside — and this is in a dumpy warehouse part of Brooklyn — and there’s a juice bar across the street and another fancy place. The whole neighborhood is changing. Now, someday someone’s going to come along and want to rip down that building. [Martin Greenfield] is going to have to have a loft building to make his clothing in. We want to protect that.”
In fact, Greenfield and his sons, Jay and Tod, own the manufacturing facility so they’re safe from the threat of gentrification that could potentially squeeze them out. The family employs 120 people there. “If we had to pay rent to be here, it would be a huge problem,” said Jay Greenfield. “It’s hugely important to have industry in the city. Job creation is key. It can’t all be real estate. Someone has to have a job and earn a living and pay taxes and raise children to make a city work.”
Nanette Lepore, whose assistant, Erica Wolf, is executive director of the Save the Garment Center trade association, applauded Bloomberg’s stance — even if he wasn’t always so amenable to the group’s concerns earlier in his administration. “It took a little while to get his attention. We did have to do a couple of rallies. But it feels like he gets it now,” said the designer. “I do think he backed off the initial intention to develop the area into more commercial businesses.”
There are limits to what can be made in high-cost New York and it’s advanced production that Bloomberg believes is the most effective use of space here — hence efforts like the EDC and the CFDA’s Fashion Manufacturing Initiative. “If you were going to make 100,000 white T-shirts, you’re probably not going to do it in New York City,” said Bloomberg. “As a matter of fact, you’re probably not going to do it where you would have done it four or five years ago because that’s a business where low price is everything.…In places that compete on price, you always will find somebody who is willing to do it at a lower price. And you see that in China, things moving from there to Bangladesh and Indonesia. There will always be someone hungrier. But what New York brings is a quality. If you said to Oscar [de la Renta], ‘Do you sew things here or in Bangladesh?’ It isn’t even close. He wants to be where he can see the work. He wants to be where his customers can interact with the people that produce, the seamstresses. And he wants people who understand the diversity of New York and of the world.”
It’s that diversity, long one of the city’s most evident calling cards, which is an asset to multinational companies of all stripes, in Bloomberg’s view. “I’ve always thought that New York will do phenomenally well in I.T. because if you are going to build an iPhone and want to sell it around the world, you’ve got to know about people around the world,” he reasoned. He added a jab at the city’s cross-continental rival. “If you live in Silicon Valley, you don’t. It’s a great place — you play golf, lift weights, ride bicycles. And if every girl that you date is named Siri and that’s OK with you, then it’s OK. But it’s [New York’s] diversity that has built the fashion industry and everything else.”
Bloomberg takes great satisfaction touting New York’s standing as the safest big city in America. According to Federal Bureau of Investigation statistics, he’s right — New York has the lowest per capita rate of violent and property crimes in the country. That fact is a big part of the Bloomberg legacy, although it comes with a price — namely the controversial stop-and-frisk policy that critics and at least one court have found amounts to illegal racial profiling of minority men. On Friday, the 2nd U.S. Circuit Court of Appeal denied a city motion to suspend the lower-court ruling that the stop-and-frisk policy has been conducted in a discriminatory and unconstitutional manner.
It’s possible to see loose parallels to the stop-and-frisk controversy and the current firestorm surrounding Barneys New York and Macy’s. Two separate black customers have alleged they were stopped and questioned by police officers after making big-ticket purchases at Barneys’ Madison Avenue flagship. Barneys has denied that any of its employees were involved in the incidents. The NYPD has disputed that assertion, claiming the stops were made after Barneys employees raised suspicions about the purchases.
Asked about the cases, Bloomberg couldn’t resist the chance to defend the stop-and-frisk policy — and was generally sympathetic to the plight of retailers fighting theft. “In the case of stop-and-frisk, the judge [Shira Scheindlin, who was removed last month from the case by the federal appeals court] keeps thinking that we should stop people in proportion to their representation in the population. By that argument, you would stop a bunch of little old ladies, which we don’t. We’re not going to find many guns with little old ladies. In stop-and-frisk, we do what we think the law allows.…We stop people if they act suspicious — and there is a definition that’s been vetted by the courts — or if they fit the description of a perp,” said Bloomberg.
“Now in the case of Barneys, I have no idea what really happened. All of these stores have a very big problem with theft. You look at clothing in stores, they have these tags you can’t take off which would buzz if you walk out the door. I don’t know much about the retail clothing business but I think it is a very big problem.”
Bloomberg sees his focus on safety and crime as having had a direct impact on the retail climate in the city. “If you make the streets safe, then people come out on the streets. If they come out on the streets, then you can have a store that people can walk into. It all feeds together,” he said. “It’s interesting, when I ask Diane [von Furstenberg] or Oscar or Barry Diller or Ralph Lauren — he is a very old, personal friend — it’s not about fashion, it’s more about business. What’s the economy doing?”
Bloomberg gave his old friend Lauren’s business a boost when he handed the designer the keys to the city on the occasion of the opening of Lauren’s palatial Madison Avenue women’s flagship in 2010. “When we opened the doors of our new store on the corner of Madison and 72nd, the mayor was there not only to celebrate that accomplishment, but in a bigger sense to show his support and pride for our city’s all-important fashion industry,” recounted Lauren. “As someone who was raised in New York and having spent my whole life here, I’ve always felt that Mayor Bloomberg was looking out for all of us and for the good of the city. As a leader, he has maintained an openness, a receptivity to ideas and an accessibility that is rare.”
Macy’s Lundgren was emphatic that a continued focus on crime and safety by Bloomberg’s successor is of paramount concern for him and his colleagues on the Partnership for New York City, the influential organization of ceo’s that he cochairs. “The number-one thing that the Mayor-elect [Bill De Blasio] should indeed focus on is safety in our city. That is so incredibly important,” said Lundgren. “We never can take for granted that this is a city that has been under attack, it is a city that once had significant violent crime and today this is considered the safest large city in America. And we should never take that for granted and know that it requires strong leadership from the mayor and the police commissioner. So, however that gets done in the next administration, I’m just counting on that being an extremely high priority for Mayor De Blasio.”
Von Furstenberg and Kolb, the president and the ceo of the CFDA, respectively, have yet to meet with De Blasio. “I can’t wait to meet him. Bloomberg has set an incredible example,” said von Furstenberg. “The most incredible thing is that the mayor was always available to any conversation. He knows how important an industry we are to the city. All we really need to know is that [De Blasio] will recognize how valuable we are.”
De Blasio has stayed mostly under the radar since his election victory and of the 60 prominent New Yorkers appointed to his official transition committee, just one comes from the fashion world: Kevin Ryan, founder and chairman of Gilt.
As could be expected of a close friend and frequent dinner companion of the mayor’s, de la Renta was effusive in his praise of Bloomberg. “I remember when I came to New York, when I was afraid of leaving my office at 550 Seventh Avenue. I was afraid that people would come and break the glass of my car. All of that has disappeared from the city,” said de la Renta, speaking by phone from his home in Punta Cana in the Dominican Republic.
“The whole city should be in mourning about the fact that Mayor Bloomberg is leaving. He is, by far, the best mayor the city has ever had. What Mayor Bloomberg created for the people in this city and the legacy he has left behind is extraordinary. Today, New York City is, by far, the capital of the world and we owe that to the work of all of us, but mainly to Mayor Bloomberg,” gushed de la Renta.
The designer and his wife, Annette, along with von Furstenberg and husband Diller, are planning a glitzy celebratory dinner for Bloomberg in early December. “It’s not a farewell dinner. It’s a thank you dinner,” insisted von Furstenberg.
De la Renta reminisced about the many meals he and his wife have enjoyed with the mayor and Diana Taylor over the years. “At least a couple of times a month, we will have dinner quietly. Never, ever in a fancy restaurant. Always in all parts of the city. We’ve had rice and beans in Washington Heights,” recalled the designer. “He was so proud because so many people would come up to him and say, ‘Mayor Bloomberg we are so proud of you.’”
During de la Renta’s long bout with cancer — he is in remission now, he said — and extended hospitalizations over the past years, Bloomberg was a constant source of comfort. “When you are not well, you realize who your friends are and who are those people who are not your friends,” said de la Renta. “Mayor Bloomberg called me on the telephone at Memorial [Sloan-Kettering] hospital almost every single day and came to see me in the hospital almost twice a week. That is called loving friendship.”
Wintour has built a fruitful relationship with Bloomberg over the years. A decade ago, the mayor hosted a dinner at his house for the launch of the CFDA/Vogue Fashion Fund, for example. More recently, he was a key supporter of the Vogue-sponsored Fashion’s Night Out programming that ran from 2009 to 2012. The CFDA recognized Bloomberg’s contributions to the fashion industry in 2008 with a Board of Directors’ Special Tribute, the only mayor to ever receive that award.
“He’s been an incredible partner and he’s really understood what a huge part of the New York economy the fashion business is and every time one reached out to him, whether personally or through the auspices of the CFDA, he totally has stepped up to the plate,” said Wintour. “He realizes that fashion is the heartbeat of this city and it’s been an extraordinary experience working with him.”
Bloomberg returned Wintour’s sentiments, praising the Vogue editor in chief and Condé Nast artistic director’s leadership in the industry and its related philanthropic efforts. He said Fashion’s Night Out helped revitalize the city following the 2008 recession — although he added it had lost much of its mojo by the time it went on “hiatus” this year.
“You have to give some credit to Anna Wintour.…She’s very smart and she’s done a good job,” he said. “They started this Fashion’s Night Out. Each of these things, they run their course, they become blasé. Everybody else starts doing it. And that’s when you got to learn, drop it and do the next thing.”
While discussing Wintour, Bloomberg made a point of singling out one of her editor peers. “Joanna Coles, who runs Cosmo, is a dynamo. She is the future of fashion,” he enthused, unprompted. “She’s got a pizzazz about her and an edge that is exactly what you need in that business. I’m a big fan.”
Bloomberg is less of a fan of youthful, experimental fashion — the city’s efforts to aid emerging designers notwithstanding. “You have all these new fashion people that you and I have never heard of, doing things that I don’t like. I don’t think they are real fashion,” he scoffed, proffering his preference for Establishment labels like Oscar de la Renta, Carolina Herrera and Ralph Lauren. “But that’s what our parents said about our stuff and what these people will say about the next generation,” he allowed philosophically.
What does he hope people will say about his three-term mayoralty? On the topic of his legacy, Bloomberg laid out a manifold response, encompassing a range of achievements.
“Life expectancy in New York City today is two-and-a-half years greater than the national average and three years greater than when I came in. And if that isn’t an accomplishment for our administration, of making 8.4 million people live three years longer, then I don’t know what is,” said Bloomberg. “That [increase] includes fighting crime, that includes faster response times with ambulances and fire trucks and police cars. That includes the smoking ban and getting rid of trans fats and ratings of restaurants, it’s all of that.”
While it’s unlikely that restaurant ratings have had a huge impact on life expectancy, it’s true newborn New Yorkers now live an average of 80.9 years, compared to the national average of 78.7 years.
“The second thing I would say is education. We’ve made an enormous difference in education — hopefully it doesn’t get rolled back,” continued Bloomberg. “But today, minority kids, 70 percent more are graduating than did when we came into office. Crime in schools has gone away. When I came into office, not one of the 25 best schools in New York State were in New York City. This year, 22 out of 25 [elementary and middle schools, ranked by standardized tests] were in New York City.
“And the third thing is, honesty in government — nobody has ever thought they could bribe their way in,” concluded Bloomberg. “We do whatever we think is right. You can question whether that is what’s right. But nobody questions the motives. And I think it showed a new way of bringing people in, where you attract great people. You delegate and you give them the authority to go along with responsibility, which is the real key to management. And the results are there.”