Mamdani Talks ‘Pied-à-Terre Tax 2,’ Saying ‘Wealthiest City’ in the World Can Afford ‘To Deliver Dignity’

New York City has yet to collect a dime of the $500 million Mayor Zohran Mamdani and Governor Kathy Hochul promise their pied-à-terre tax will bring into public coffers each year, but the two are already eyeing copycat levies.The pied-à-terre tax, introduced as part of the state budget last spring, will impose additional property tax starting at $40,000 annually on luxury residential properties that are not used as a primary residence by the owner, an immediate family member, or a tenant.Now the two are talking about a “pied-à-terre 2” to help finance the $12 billion statewide universal childcare plan beyond 2027. Asked Tuesday whether an additional surcharge similar to the tax would provide an adequate financial foundation for Mr. Mamdani’s plan for free daycare for all, the mayor paused before answering.“I’m just thinking of ‘pied-à-terre 2’ in the ‘Fast and Furious’ style, what the tagline would be,” he said, adding, “I have never been shy about the fact that given that we are the wealthiest city in the wealthiest country in the history of the world, we know that there is enough wealth to deliver dignity. It’s just a question of whether we want to take the steps necessary.”Mr. Mamdani called the pied-à-terre tax “incredibly important” both “because we continue to be incredibly confident in its ability to raise half a billion dollars per year” and because it will redistribute wealth from wealthy homeowners “to make our streets safer, to strengthen our schools, things of that nature.” The mayor’s remarks followed comments Governor Kathy Hochul made while the pair were in Puerto Rico for the annual policy conference hosted by a nonprofit focused on the needs of New York’s Hispanic population, SOMOS Inc. Ms. Hochul told reporters she was considering “creative” methods similar to the pied-à-terre tax to finance the state’s universal childcare push. Even with the program fully vested this year, funding beyond 2028 is uncertain.“When it came to helping the city out in a severe financial crisis that the mayor inherited, I stepped up with a creative way to do that,” the governor said Friday. “I’m telling you that I want to find a creative path to make sure we have the resources necessary to be able to have a long-term commitment to childcare.”Mr. Mamdani’s comments Tuesday followed a bill signing also related to real estate. The new law, the Community Opportunity To Purchase Act, or COPA, grants certain approved nonprofit organizations the right of first refusal when multi-unit residential buildings that are in bad shape or subject to rent restrictions hit the market. The law’s goal is to place a hurdle in front of developers eyeing low-income housing to flip for higher rents and instead position tenant groups to take over their homes from negligent landlords.At the other end of the property market, Manhattan’s real estate saw its best sales week in five years at the start of November, according to Olshan Luxury Market Report. Buyers signed 45 contracts for properties valued at $4 million or more between November 2 and November 8, with just under $450 million changing hands.Leading the pack was casino mogul Steve Wynn’s two-story penthouse in the Ritz-Carlton at 50 Central Park South, which he had been trying to offload since 2022. Mr. Wynn bought the property in 2012 for $70 million. When he put it back on the market four years ago, Mr. Wynn listed an asking price of $90 million, which made it the most expensive condo in the country at that time, according to Mansion Global. The 10,900 square-foot apartment overlooking Central Park sits atop the famous hotel. It reportedly sold last week to an undisclosed buyer at the same price Mr. Wynn paid for it two decades ago.Mr. Wynn is currently suing the state of New York over the pied-à-terre tax that Ms. Hochul and Mr. Mamdani may soon replicate. He, along with his co-plaintiffs, former Secretary of Commerce Wilbur Ross and his wife, Hilary Geary Ross, allege that the surcharge on second homes discriminates against residents of other cities who seek to keep property at New York City. Both the U.S. Constitution and New York’s state constitution expressly prohibit discrimination against nonresidents and limitations on interstate commerce.The complaint in that suit identifies Mr. Wynn as a “resident of Florida and owner of residential property located in New York, New York, with a…market value of $1 million or more.” Because he owned the penthouse as of January 5 of this year, Mr. Wynn is on the hook for pied-à-terre tax totalling $183,094.69. Whether the sale of his Manhattan property will affect his standing in that case will be determined by Suffolk County Supreme Court Judge James Catterson, who is hearing the case.

Mamdani Talks ‘Pied-à-Terre Tax 2,’ Saying ‘Wealthiest City’ in the World Can Afford ‘To Deliver Dignity’

Mamdani Talks ‘Pied-à-Terre Tax 2,’ Saying ‘Wealthiest City’ in the World Can Afford ‘To Deliver Dignity’

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