Two 14-year-olds destined to make it in New York.

2007 is likley to be a year when the industry hears a lot more from dealmakers Ioannis 'John' Danalis and Erez Eliahu, co-founders of D&E Holdings.

The duo were determined to be successful when they were both 14 years of age and now strive to become the top real estate titans of New York.

Now partners in D&E Holdings--parent of Blue Star Apartments--Danalis is the chairman. He came to New York from the Mediterranean when he was 14 and started working as a dishwasher. He knew that this was the land of opportunity and, with hard work and determination, you could become anything you wanted to be. Well, at the time, he wanted to be the best dishwasher in America--and he probably was.

Danalis held on to most of his earnings and, at the age of 21, used them as a down payment on his first restaurant, a coffee shop, which he turned into the best coffee shop in New York. And so it went, the best restaurant owner in New York, the best of everything he touched and it continued when fate arranged for him to meet Eliahu, now his partner and CEO of D&E Holdings.

Eliahu also began his working life at 14 picking bananas on a kibbutz in Israel. He had to work early, because his father died when he was three years old and there were a number of mouths to feed in his family. However, like Danalis, he was deeply ingrained with the j work ethic and also determined to be a success in whatever he chose to do.

So when these two met, each realized that the other had lived by the same values and had the same desire to become the best in their chosen professions.

They decided to join each other and form a company to invest in real estate, but not just another real estate company. They decided to apply the rules they had honed on the way to the top: do business with a handshake and live up to it. It worked well in previous years and it could work well today: give small investors like your dentist, accountant, postal carrier and others a chance to live the American dream. Their short-term investments of 1 to 11/2 years returned an average of 63% and those on long-term rental buildings averaged 11 to 13%, but they acquired an asset, they owned a piece of property.

After 15 years in New York, D&E Holdings is the owner and manager of 15 buildings 10 months ago, they Formed Blue Star Apartments. They came to realize that the price per square foot is undervalued in major cities around the world, in London, Moscow, Paris and in New York, so they only invest in Manhattan properties, and only in the most desirable sections such as Soho, Tribeca, the upper East Side and the upper West side. In the past few years, they have tripled the income of the building thet manage.

How do they do it? They believe in research, research and more research. They do their homework. Besides investigating the neighborhoods and amenities, they analyze the rents. Then they invest in properties that are badly and inappropriately managed.

As with some other successful real estate companies, they make major capital improvements. A new roof, new windows, new hallways and upgrading of heating, plumbing, etc. They also look for tax breaks and illegal subleasing, among other things. They increase the rent roll and sell the building in 18 months, for a 50% return on investment.

The difference with D&E Holdings is that they cover all bases for their investors. D&E buys the building, Blue Star Property Management operates it and Blue Star Apartments chooses the best credit risk tenants to occupy the apartments--a winning combination. "We build a relationship with our clients," said Danalis. "The size of the deal, whether rent or buy, doesn't matter. We treat everyone with courtesy and thank them for their confidence in us."

Eliahu added that it's time someone represented the interests of the owners and rental agents.

"Others get 6% broker's fees. Not us. I know it sounds like another advertising cliche, but it's a daily truth with us and our business dealings, 'We do more for 4'. We get personal thank you notes from young professionals who make up most of our tenants, because we're selling a life style.

Danalis proffered, "We believe in honesty, a handshake and building personal relationships. It continues to pay off for investors, agents, tenants, and it's making us wealthy by living up to our promise to be the best in everything we do."