Looking southwest over Prague from atop Parukarka, the city ambles down from Vinohrady through the paneláks of lower Žižkov to Old Town’s spires. This is guidebook Prague, but to the east steel skeletons peak through the trees. A few meters below, the towers of Central Park Praha (CPP) stand in full, aligned diagonally from Olšanská street toward Jana Želivského street on 10 hectares of Prague 3 land. They horseshoe the upscale development, framing what will become a green valley and park below Parukářka.
This represents the Prague of Milan Ganik’s vision.
“I thought it was important that Prague transcend a number of preconceptions,” Ganik says: Everyone knows Old Town, Kampa and paneláks, but the city has more, especially in housing options.
CPP, Ganik’s homage to Manhattan’s Central Park, will house about 2,000 people when finished, possibly by year-end. It will have a 2.5-hectare private park, dry cleaner and grocery. Cleaning, day-care, and dog-walking services optional.
A former licensed cosmetologist, dry cleaner, US congressional aide and Manhattan lawyer, Ganik conceived the project, courted investors with partners and managed development until this year. His vision for this mixed-use development, with its surrounding greenery and village-within-a-city vibe, is nothing if not ambitious, says Tomáš Zykán, who worked on marketing at CPP from 2005 until February.
It “goes beyond the building itself,” Zykán says. “What was important was the quality of life, which means not only how the building looks, but how [residents can] spend their time and create a community. That’s why the Central Park was difficult to grasp.”
The financial crisis has hurt CPP and Ganik, costing him his job as managing director. The largest investor took over management in February. Ganik was appointed president of the supervisory board 5 May, after two months in limbo.
Despite Ganik’s diminished role, his company, CPP Development, is working on other Prague property ventures, and he remains sanguine, if diplomatic.
“I think the reason why this was an amicable agreement is that I wanted to ensure … that the project would not be in harm’s way,” he says. “It doesn’t matter who manages it as long as it’s managed in a way that we deliver what we wanted.”
Though, Ganik adds, he may yet rejoin management: “It’s possible.”
‘Why don’t we create a Central Park?’
Ganik, 55, emigrated to the US with his family in 1968 and has worked in real estate for most of his career, first as a New York lawyer and later as a marginal investor in several Prague developments. Recounting the genesis of CPP in his office off Olšanská, Ganik, bald with an aquiline nose, wears a silver suit with a blue tie and sharp frameless glasses that darken in the sun. Ganik is gregarious, charming and open, disclosing up front the management shakeup. He also oozes the unpracticed insouciance of a man who has grown comfortable with life’s vicissitudes.
Ganik is nevertheless measured. Interviewing him feels a bit like lying to your mother: What are you up to? his eyes ask. After all, he practiced law for nearly 20 years, seven of them at global law firm Squire, Sanders & Dempsey.
In 1991 Ganik made partner there and moved to Prague to establish a subsidiary. He returned to New York in 1994, and lived with his wife, Addie, a dermatologist, and their three children near Central Park.
They’d planned to buy a country home for weekend escapes but quickly found a small community in the neighborhood, with their offices, kids’ schools, butchers – the works – close by.
“You didn’t even need the car,” Ganik says. “It was like a village.”
Years before the groundbreaking ceremony, Ganik had begun to lay the foundation for CPP. Still, not until 2003 – six years after relocating to Prague and leaving his partnership – did the real digging begin.
Ganik was running a boutique investment bank then, and he and some friends became interested in the large tract framed by Parukářka and the intersection of Olšanská and Jana Želivského.
The property – owned by several utilities, a sporting association and private individuals – and its environs weren’t the Prague of guidebooks, to put it charitably.
“We were thinking, ‘What can we do with this land'” to give it some cache? Ganik says. “So I thought, ‘Why don’t we create a Central Park?'”
All rise for Justice Rehnquist
Originally from Žilina in western Slovakia, the Ganiks escaped in 1968. Prior to settling in the Washington, D.C., suburbs, the family spent a few months in Austria, where teenage Milan swept floors and washed hair at a salon.
After learning about this experience, administrators at his American high school decided barbering was the best hope this immigrant without English skills had for a future in the U.S. They got him a cosmetology scholarship, and Ganik earned his license to style at 15.
Ganik learned English “mostly by not going to school – and watching TV”, he says at the CPP construction site. He looks very much the banker in his silver suit, though scuffed shoes betray his daily trips to the construction site.
In 1971, as a high school senior, Ganik bought a dry-cleaning business for USD 1,200 after his father was in a car accident that doctors thought would leave him permanently disabled. To help support his family, Ganik worked there while studying at University of Maryland. Clientele included major political players. Ganik lived above the store, and one night a banging at the door woke him. Supreme Court clerks had forgotten to fetch William Rehnquist’s gown for his swearing in as associate justice the next day. Of course, Ganik retrieved the future chief justice’s gown.
Ganik graduated from university in 1973 – after two years – his father took over the dry-cleaners, and Ganik got a job in the courts. Three years later, the road called.
“I decided to travel around the world, but only got as far as America,” he says.
That year Ganik worked as a court reporter, substitute kindergarten teacher and on a farm, among other jobs. In 1977 he returned to D.C. and volunteered for a congressman before entering the University of Virginia School of Law in 1978. He landed at Baker & McKenzie after graduating, opened his own firm a few years later and joined Squire, Sanders & Dempsey in 1990.
Then, financial crisis
Ganik collaborated with three professionals in construction, finance and marketing on CPP until the 2006 groundbreaking. They selected A69 Architects, a Czech firm, through a 2003 tender and secured the land two years later.
Construction could finish this year at a projected cost of CZK 4.5 billion – a year and a half behind schedule and nearly CZK 1 billion over budget. The latter is the reason the biggest investor, Česká Spořitelna-backed CEE Property Development Portfolio (CPDP), increased its stake.
Because of the financial crisis, Unicredit Bank, the primary lender, demanded more equity than usual when Ganik requested extra capital to cover budget overruns last summer. Delays in negotiations with the bank prompted the contractor to halt construction last fall, just as the first tenants were to move in. Sales suffered, and clients got nervous.
“The financial squeeze definitely took a toll on Central Park,” Zykán says. “There was quite a pressure, and the pressure was resolved by the CPDP stepping forward” with more money.
CPDP took control of the project, and the new managing director, Jan Domiter, says it will be finished by fall. Ganik is pragmatic about the change.
“In order to jumpstart the project, I made a compromise,” he says. “We have deferred to the largest investor.”
About 300 of 550 units have sold. The apartments and villas range from CZK 65,000 to CZK 100,000 per square meter.
Ganik had hoped 75% of the units would have sold by early 2009, but now he’s focused on completing the development and moving existing owners in by the end of the year, rather than sales. It would be fine with him if the majority of remaining units sold by 2011, though it’s unclear the new management feels the same.
Ganik doesn’t rule out another executive role, though he has yet to hang several pictures in his Olšanská office, a downgrade from a previous space on Wenceslas Square. Meanwhile, CPP Development has other ventures in the works, including a Prague mixed-use development that would be larger than CPP.
About this, though, Ganik keeps quiet. “I don’t want to jinx it,” he says.
