The reckoning at the D&D

Issue #00025: April 30th, 2026

Hello readers,

I’m writing this from Venice, where my morning lungo macchiato comes with a side of canal fog and the sound of delivery boats hitting the dock at dawn. My schedule here is reversed—daytimes are for Venice, evenings for New York—and I’m running on clams, caffeine, and adrenaline. Massive week ahead.

We’ve got an insider’s take on North Carolina’s High Point Market—that’s right, Mr. Thread operatives are everywhere this week. We’ve also got the biggest story we’ve ever published on the troubled D&D Building: a candid conversation with a veteran Midtown commercial broker about what Fortress really wants, what might happen to the building if Cohen defaults, and what showroom tenants should do right now.

We also dive into another huge story about the looming tariff refunds, and the big question everyone is beginning to ask: if I get a refund, should I be giving it back to my clients? No easy answers here. 

Next week, I’ll be at the Fondazione Dries Van Noten in a 15th-century palazzo on the Grand Canal—Comme des Garçons, Christian Lacroix couture, and contemporary art under Tiepolo ceilings. I can barely sit still.

Read on for the tariff refund debate nobody wants to have, why mohair is out, and what Taylor Swift trademarking her own voice means for every creative in our industry.

See you next week,

Mr. Thread

What Happens to the D&D Building Now?
I went to Shun Lee Palace in Midtown with a veteran broker I’ve known for years—a family friend, three decades in the market. I’m not naming him because I want him to keep talking to me. A judge gave Charles Cohen 45 days to raise $135 million or lose 979 Third Avenue to a court-appointed receiver. If he can’t, Fortress steps in. Over egg rolls and pork fried rice, I got the answers our industry needs. Here are the edited highlights of our conversation…

Let’s start at the beginning. How did we get here?
Cohen borrowed $533 million from Fortress in 2022—largely to refinance prior debt—and put up a portfolio of properties as collateral along with a $187 million personal guarantee. His portfolio started missing payments. Fortress ran out of patience. What followed was two years of legal maneuvering, delay tactics, and asset transfers that a court didn’t buy. He already lost the Design Center of the Americas in Florida to a foreclosure auction in late 2024. The D&D and the Pacific Design Center in LA are what's left.

The number that matters: $135 million—approximately what’s still owed on the personal guarantee. The court-ordered deadline was 45 days from March 9. We’re right at that window.

What happens if he can’t come up with the money?
The receiver takes over. That’s Fortress’s man—David Moson—who already has authority over 16 of Cohen’s ownership entities. His job is to sell assets until the debt is satisfied. The D&D is explicitly on that list. Fortress could sell to a third party, or acquire it themselves through a credit bid—exactly how they got the DCOTA.

So could Fortress become the landlord of the D&D?
That’s the more likely scenario. The D&D isn’t a Class A office building you can hand to another operator. It has 100-plus specialized tenants and a niche market. Fortress saw it up close for years as Cohen’s lender. They understand the asset better than most potential buyers would.

What would they do with it?
When Fortress took over the DCOTA, they didn’t padlock the doors. They hired Jamestown—one of the best mixed-use operators in the country—put $3 million into improvements immediately, and started running it like a real business. They weren’t stripping it for parts.

Fortress is now majority-owned by Mubadala, Abu Dhabi’s sovereign wealth fund. These are not cowboys. The firm manages roughly $53 billion across its strategies, with a long-running real-estate book in senior housing, industrial, and multifamily across the US, Europe, and Japan. If they end up with the D&D, they’re going to want it generating income, not sitting vacant.

But they’re not going to run it like Charlie Cohen did.
And that’s the opening for tenants. Cohen’s reputation among his own showrooms—at least in private—was not great. Deferred maintenance, poor marketing support, declining building quality. Fortress would approach this differently. Not because they're generous. Happy tenants are the asset.

Can a new owner cancel existing leases?
It depends on your subordination language. Most commercial leases contain a clause where the tenant agrees their leasehold interest is subordinate to any mortgage—meaning the lender’s rights come first. If a foreclosure happens, that provision can give a new owner the right to terminate leases that predate the mortgage.

The protection against that is a Non-Disturbance Agreement—the “N“ in an SNDA (Subordination, Non-Disturbance, and Attornment Agreement). If Fortress signed one with you, they’re contractually obligated to honor your lease after foreclosure, as long as you’re not in default.

So the question every D&D tenant should be asking: do I have an SNDA with Fortress?
Exactly. Does your lease contain a non-disturbance provision, and was it signed by the lender, not just the landlord? A subordination clause without non-disturbance is actually worse than no subordination at all. That said, a financially rational new owner doesn’t typically empty a fully-tenanted building. That destroys value. What you’re really worried about is someone buying the building to redevelop it.

Can someone knock this down and build a luxury tower?
979 Third Avenue sits in Midtown East with a floor area ratio of roughly 10x to 12x for commercial uses. The building is approximately 580,000 square feet, 18 stories, built in 1963. Real development potential in theory.

In practice: 100-plus tenants with leases to buy out. Floor plates too deep for residential conversion, limited light penetration, and 10 elevator cores in an 18-story building—no residential building that height needs 10 elevators. Any buyer looking at the D&D as a redevelopment play is thinking 10 to 20 years minimum.

So the near-term scenario: new ownership, same building, probably better management.
That’s my read. What matters now is how you position yourself when the transition happens. Fortress is going to need to understand this building quickly—which tenants are healthy, which are anchor draws, who represents the institutional knowledge of what makes this place work.

The D&D is a community with its own rhythms—Fall Market, Spring Market, the relationships between showrooms, the foot traffic patterns. If you’re a strong tenant who’s been there a long time and runs a tight ship, you’re not a problem for a new owner. You're an asset.

Should tenants be reaching out?
Carefully. Not panicked outreach, not a desperate call. But if you have a credible perspective on how to make the building work better—what amenities it needs, what programming draws traffic, where Cohen dropped the ball—that’s a conversation a new owner would want to have.

What’s the downside risk?
Three things. Make sure your rent is current and your lease obligations are clean—the first thing a new owner does is review who’s in default. Know your lease cold: expiration, renewal options, subordination clause, SNDA status. Get your attorney to review it now, not when you get a letter from a receiver.

And if Fortress sells to a third party, you want to know before it closes. New buyers sometimes restructure leases as a condition of purchase. You want to be in the room for that conversation.

Is this ultimately bad news for the design industry?
Not necessarily. Cohen’s tenure wasn’t loved. The building needed investment, management, and programming. A new institutional owner with real capital might actually be better for tenants than a landlord who couldn’t pay his own bills.

UPDATE: As we were finalizing this story, Business of Home reported that Cohen secured a 30-day extension—pushing the deadline to May 20. Fortress agreed after Cohen reported progress on a deal he says will fully cover the outstanding principal, interest, and $12 million of the lender’s attorney fees. They wouldn’t have given him 30 more days if they didn’t believe he had a legitimate shot. Based on the conditions in the building and the way things have been going, I see this as a bad outcome. Almost universally, every tenant colleague of mine agrees. The place could use a new owner.

Inside the tariff refund dilemma
As of April 20, US companies can request refunds for tariffs the Supreme Court ruled illegal—roughly $175 billion in total. But Modern Retail reports that most brands can’t simply hand the money back to customers. Wild Rye paid $250,000 in tariffs but estimates total costs at $750,000 after pausing production, raising prices, and canceling trips. Baby’s Brew paid $50,000 in duties plus interest on credit lines. Dame refunded its $5 “Trump Tariff Surcharge”—but that was just $10,000 total. The bigger brands can’t cut checks that easily.

At one of my brands, we itemized our tariff surcharge on every invoice so we could strip it away cleanly. That transparency felt like the right call. Now it complicates things—because clients can see the line item and point to it. But we were also paying tariffs on every input we bought to run the business, and nobody is refunding those upstream costs. The surcharge was a partial offset against losses coming from both directions simultaneously. Any government refund isn’t a windfall—it’s the first recovery on a loss that’s still larger than what’s being refunded. 

My advice: document your full damage, wait for refunds to actually materialize, and communicate proactively. Have a clear, principled position ready before your clients ask. Because I can tell you: the phone rang this week and it was a client asking for us to remove the Tariff charge on an invoice. It’s happening.

High Point Market according to Chad Smith.
North Carolina’s sprawling furniture and design showcase, High Point Market, ran April 25–29. We spoke to Chad Smith, a 30-year veteran who has seen this show from every possible angle—retailer, rep, distributor, consultant, and now the guy trying to drag legacy brands into the age of AI. His wife is a designer. His mother is a designer. She's 78! There’s probably no human who has spent more hours on the floor at High Point than Chad Smith. That’s not something he’s proud of. He drove up from Charlotte every day to this market, and we called him while he was still decompressing.

I am usually underwhelmed.
High Point is where most of the legacy brands show up twice a year and try to encourage designers, retailers, distributors, reps, industry people to pay attention. I’ve personally been going for 30-plus years, and some things have changed—a lot of things have stayed the same.

Designers are now like the prettiest girl in school.
That’s the biggest shift. They’re the ones that everybody wants to get the attention of and bring into the showroom. Brands see them as a way to be like an unpaid sales force for them.

I find it slightly embarrassing.
You see younger designers there with somebody filming them, or one of those iPhone things that they hold out in front of them as they walk through. I saw a handful of quasi-influencers walking around with a little posse behind them. Brands in our industry, in my opinion, have always kind of sucked at marketing, and designers are proving to be a lot better at it.

Most of the professionals aren’t going to some bullshit cocktail party at some random showroom.
In these uncertain times economically, people are not there for shits and giggles. They’re there to do business.

You see the same rep in the same bad suits they’ve been wearing for 10 years.
They’re standing out in front of these old legacy showrooms, talking from the same script. High Point is freaking huge—50 to 75,000 people show up over five days. 

There’s nowhere for people to stay.
No hotels. People have to either fly into Charlotte or fly into Greensboro or Raleigh. And most people stay in Greensboro and go out to eat there and entertain and whatnot.

313 Space is far and away the best place to be in High Point.
There’s a new building that just launched, and it’s where all the new cool brands are showing. They’ve spent a ton of money, and it’s very well done. A lot of the new brands, like Pookie, don’t want to be in the IHFC building, just because it's the same shit every year, and it's really expensive for these brands to show.

Many brands are invisible on AI, and they don’t know it yet.
They were invisible before because they were trade only, and Google forgot about them. Now they don’t know how to list and get their data right for AI, and they're going to be invisible again. So they’re invisible twice. Our industry is always a solid decade behind on adopting technology, and this is about to run over a lot of people. AI is going to summarize their brand in one sentence, and they have no influence over what that sentence is.

Data is the new showroom.
Most of these brands have not invested in it. They see it as an expense. If you’re searching for a product and you can’t find it on your own website, then how is AI supposed to help you? I’m trying to address this problem with the new platform I'm building. We've got a tool that lets them see where they’re missing out, and then we have a tool that fixes it for them. We’ve got a free scorecard they can take. A handful of brands I’m consulting with right now have realized it, and the gap is just massive. All of their ecom managers know it, but don’t know what to do about it, and they don't get any budget.

It’s never been easier to launch your own line.
The barriers to entry for starting your own private label brand are really coming down. Because everybody’s so scared, a lot of the big minimums are being shrunk. If you have a point of view and some taste, AI can give you a website. You don’t have to fly to China and visit a factory anymore.

I try my best not to pay for food at things like this.
Universal Furniture is my go-to. I ate there every single day. They do first-class catering. Yesterday was salmon and couscous, and it’s clean, healthy, good food. I avoid the food trucks that charge you 15 bucks for a smash burger or some second-rate Mexican fajita, but I would bet Universal is getting a very good return on their catering budget, because that’s where everybody goes.

Chad Smith runs Tradescope.pro. They audit home furnishing brands’ digital presence and fixes the data, schema, and structure problems that make them invisible to AI.

Stay away from Mohair
TJX and Macy’s just committed to banning mohair across their stores—TJMaxx, Marshalls, HomeGoods, and Macy’s private labels including Charter Club, Bar III, INC, and Alfani. The ban came after PETA shared footage from facilities in Lesotho and South Africa showing workers violently striking goats and shearing animals so roughly they were left wounded. They join Zara, Gap, Banana Republic, ASOS, Uniqlo, Ralph Lauren, and Express on the ban list, according to Home Textiles Today.

Mohair is everywhere in our industry—a beautiful, durable velvet popular in upholstery and drapery. We used to carry it at one of my brands but discontinued it because it was too expensive in our supply chain. Now there’s another reason to move on. Just a heads-up to check your supply chains. PETA is pushing H&M to reinstate a ban it lifted in 2020. 

Here’s one golden business rule: Don’t mess with animal rights activists.

Will Taylor Swift save the arts?
Taylor Swift just filed three trademark applications with the United States Patent and Trademark Office—two sound marks covering her voice (“Hey, it’s Taylor Swift” and “Hey, it’s Taylor”) and a visual mark covering a specific concert photograph. Variety reports the move follows Matthew McConaughey’s similar strategy to stop anyone using AI to copy how he says his famous catchphrase: “Alright, alright, alright!” (and other intellectual property). 

IP attorney Josh Gerben explained the logic: federal trademark infringement suits apply nationwide and carry stronger enforcement than state right-of-publicity claims. As polarizing as Taylor may be, this is exactly the kind of heavyweight legal muscle the creative world needs. If TS can set the precedent, every artist, designer, and craftsperson benefits.

Meanwhile, the backlash against AI keeps building. A Quinnipiac poll found 55% of Americans now say AI will do more harm than good—up from 44% a year ago. Business of Fashion reports that luxury brands using AI-generated imagery face customer revolts: Prada, Gucci, and a small brand called Selkie have all taken heat. The gap between executive enthusiasm and consumer reality keeps widening: 82% of ad execs think Gen Z feels positive about AI ads, but only 45% of Gen Z actually does. 

We’re manifesting the world back to humanity, and it’s happening faster than I thought.

Design for college kids
Williams-Sonoma just relaunched Dormify—the dorm-room furnishings brand it acquired for $1 million out of bankruptcy last May. The new site is live with a 3D bed visualizer, washable rugs, and pickup at Pottery Barn and West Elm stores. President Jennifer Kellor told Modern Retail they see "a lot of runway for growth" in a category where they still have a small share. The timing is deliberate: May 1 is Decision Day, when seniors commit to colleges. Dormify is seeding products to influencers and wheatpasting ads near NYU. This is a life-stage play—catch them in the dorm, convert them to West Elm customers for the next 30 years. All I can say is, it’s a long way from my college dorm, which I shared with several cockroaches.

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