{"id":31229,"date":"2025-11-06T21:26:11","date_gmt":"2025-11-06T21:26:11","guid":{"rendered":"https:\/\/www.newsbeep.com\/us-ny\/31229\/"},"modified":"2025-11-06T21:26:11","modified_gmt":"2025-11-06T21:26:11","slug":"what-commercial-real-estate-can-really-expect-now-commercial-observer","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us-ny\/31229\/","title":{"rendered":"What Commercial Real Estate Can (Really) Expect Now \u2013 Commercial Observer"},"content":{"rendered":"

After months of hand wringing<\/a>, binge drinking, and apocalyptic thinking among the commercial real estate elite, the dire prophecy of the anti-capitalist gods has been fulfilled: Zohran Kwame Mamdani, Ugandan-born Democratic Socialist and millennial son of an independent filmmaker and a post-colonial academic, will be the next mayor of the world\u2019s greatest city.<\/p>\n

Now, as Florida-bound moving trucks pack to the brim, the commercial real estate community must come to terms with a mayor that many have perceived as positioning himself against everything they stand for, and one whose basic positions could, according to some, spell the death of progress and profit in New York City\u2019s housing market in particular.<\/p>\n

SEE ALSO: Lenders Need to Consider Title Insurance Super Early in UCC Foreclosures<\/a><\/p>\n

With the election behind us, though, and the path forward finally clear, we thought this would be a good time to take a steely-eyed assessment of what a Mayor Mamdani (practice it) really means for commercial real estate\u2019s immediate future in New York City.\u00a0<\/p>\n

In speaking to some of the city\u2019s politically connected experts, Commercial Observer sought to draw a clear line between what Mamdani said he wants to accomplish and what he is likely to accomplish among his more real estate-centered proposals.<\/p>\n

But, before we address Mamdani\u2019s positions and potential achievements, let\u2019s discuss how Mamdani actually functions as a political entity.<\/p>\n

Suri Kasirer is the founder and president of Kasirer, the top lobbying firm in New York City for the past eight years. In addition to working on projects such as 5 World Trade Center, the Committee for Ranked Choice Voting, One Vanderbilt, Brookfield Place and Manhattan West, and the renovated Delta terminals at JFK and LaGuardia airports, Kasirer has been involved in five mayoral transitions.<\/p>\n

Kasirer notes that, while many have bristled at Mamdani being a self-declared Democratic Socialist, the commercial real estate industry has always found a way to work with City Hall\u2019s primary occupant.<\/p>\n

\u201cAs a city, we have been through so many transitions,\u201d said Kasirer. \u201cFolks in real estate can work with mayors of various ideologies as long as they can find common ground, and we\u2019ve found common ground with every mayor.\u201d<\/p>\n

Alicia Glen served as the deputy mayor for housing and economic development for New York City from 2014 to 2019, and later founded MSquared<\/a>, which focuses on the development of mixed-use, mixed-income housing.<\/p>\n

As a five-year member of the de Blasio administration, Glen feels that much of the trepidation around Mamdani has a familiar ring.<\/p>\n

\u201cThis is, in some ways, very much coming full circle,\u201d said Glen, MSquared\u2019s managing principal. \u201cTwelve years ago, when Bill was elected, there was this feeling that the world was going to be over, and that the Communists were coming, and New York City was going to be dead. All the rich people were going to leave, and real estate would be over, right? There was similar rhetoric in the zeitgeist.\u201d<\/p>\n

Invoking the old standby that you campaign in poetry and govern in prose \u2014 a phrase coined, ironically, by former New York Gov. Mario Cuomo, father of Mamdani\u2019s just-defeated opponent, former New York Gov. Andrew Cuomo \u2014 Glen believes that much of what we\u2019ve heard from Mamdani will turn out to have been more about communicating his aims than dictating a methodology for achieving those aims.<\/p>\n

\u201cA lot of what he\u2019s saying is really about fundamental value statements, his North Stars, the principles that he believes in,\u201d said Glen. \u201cHow that gets translated into what you can actually do, [as opposed to] what you want to do, is often very, very different.\u201d<\/p>\n

To that end, Kasirer noted that Mamdani has already shown an inclination toward flexibility: a willingness to learn as he goes, change tactics as he learns, and meet with people who have far different takes than he does on the political and financial realities of commercial real estate.<\/p>\n

\u201cAs a candidate, we\u2019ve seen somebody who\u2019s very willing to talk to people who don\u2019t agree with him,\u201d said Kasirer, referencing Mamdani\u2019s many meetings with the business community. \u201cThere\u2019s been a willingness to sit across the table with somebody you don\u2019t agree with on some fundamental issues and try to find common ground. I\u2019ve seen him do that. I think that\u2019s been an evolution for him, and it\u2019s been a very positive thing.\u201d<\/p>\n

Kasirer also noted a refreshing honesty in Mamdani about the realities of what to expect from discussions of this sort.<\/p>\n

\u201cI\u2019ve had the opportunity to be at a couple of small meetings [with him],\u201d said Kasirer. \u201cHe was very clear about finding commonality in specific areas he could work on with folks across the table who he may have had disagreement with on some issues. There was something refreshing about the clarity of saying on these issues, \u2018We may not find common ground, but here are some very specific ways in which I think we can work together.\u2019\u201d<\/p>\n

James Patchett is the president and CEO of Gilbane Development Company<\/a>, and previously served as chief of staff for Mayor de Blasio and as president and CEO of the New York City Economic Development Corporation (NYCEDC).<\/p>\n

Recognizing that any new mayor will need a strong staff behind him, Patchett said that Mamdani is off to a solid start in that area.<\/p>\n

\u201cI have met with his team and been impressed by a group of smart, experienced people,\u201d said Patchett. \u201cAs much as it is about the mayor himself, it\u2019s also about who you hire. I really do think a lot of this will come down to who he puts in key positions, and I have some confidence, given his staff, that he\u2019s going to be thoughtful in that process.\u201d<\/p>\n

As for the issues themselves, the No. 1 fear factor for CRE in Mamdani\u2019s platform has been his promise to freeze rents for New York City\u2019s approximately 1 million rent-stabilized apartments.<\/p>\n

This seems to be the most likely issue on which Mayor-elect Mamdani\u2019s actions can steer closest to his promises, though there is one potential obstacle that could be considerable.<\/p>\n

The city\u2019s Rent Guidelines Board<\/a> (RGB), which votes on these increases annually, consists of nine members, all appointed by the mayor. Of these, three serve two-year terms, three others serve for three years, and two serve for four years. The chairperson serves solely at the discretion of the mayor.<\/p>\n

At present, six members of the board are serving expired terms. Mayor Eric Adams could potentially appoint new members for all six seats before he leaves office, ensuring, if he is so inclined, that he appoints only new members who are against the rent freeze.\u00a0\u00a0<\/p>\n

Should Adams do this before his own term ends on Jan. 1, it would likely stall Mamdani\u2019s rent freeze ambitions for around two years. But even that would mean the rent freeze would take effect halfway through Mamdani\u2019s mayoralty instead of sooner, as opposed to derailing it altogether.\u00a0<\/p>\n

\u201cIf Mayor Adams doesn\u2019t [replace any members], then Mamdani can immediately appoint people to the Rent Guidelines Board,\u201d said Kasirer, who noted that when de Blasio executed three rent freezes as mayor, landlord groups tried to sue, but the courts refused to hear their case.<\/p>\n

Just about everyone we spoke with, however, acknowledged that any rent freezes for rent-stabilized housing stock cannot take place in a vacuum, but must be accompanied by some sort of assistance for landlords to prevent housing in need of maintenance or renovation from being permanently taken offline.<\/p>\n

Glen orchestrated two of de Blasio\u2019s rent freezes, but said that the freezes back then and those being discussed by Mamdani are \u201cnot apples to apples.\u201d<\/p>\n

\u201cAt the time we encouraged our appointees to vote for a freeze, there were numerous ways in which owners of rent-stabilized housing could be rewarded for investing in their properties through the rent-stabilization code itself,\u201d said Glen. \u201cIf you did capital repairs or upgrades, you could raise the rent. It had nothing to do with the RGB.\u201d<\/p>\n

Unfortunately for landlords, this regulatory framework was altered in 2019 by, of all people, Gov. Andrew Cuomo.<\/p>\n

\u201cThe changes made in 2019 were what I would call a serious overcorrection,\u201d said Glen, referring to the Housing Stability and Tenant Protection Act of 2019. \u201cAnd Andrew Cuomo, ironically, the one who was supposedly pro-landlord, completely sold landlords down the river because he was trying to appeal to progressives. It changed the game in a way that has made it much more challenging for owners of rent-stabilized properties to justify reinvesting in their properties.\u201d<\/p>\n

This puts the onus on Mamdani to find ways for landlords to recover losses that would be suffered due to a rent freeze. As it happens, Mamdani has mitigated his rent freeze discussions of late with talk of efforts to do just that, as he seeks to ease the cost burden for landlords in several key areas.<\/p>\n

\u201cTo Mamdani\u2019s credit, he has talked extensively about trying to figure out a way to mitigate increases in liability insurance for landlords, which is a huge issue for residential landlords,\u201d said Jordan Barowitz, who runs the consultancy Barowitz Advisory, and who has worked in shaping public messaging for both the Durst Organization and the Bloomberg administration. \u201cLiability insurance has doubled in the last decade, and it\u2019s an especially difficult issue for affordable housing developers to manage. Mamdani has said he wants to assist Milford Street, the captive insurance company<\/a> started by the affordable housing industry, in creating an alternative to the regular insurance market. That would lower costs for a lot of landlords.\u201d<\/p>\n

Sam Chandan, director of the Chao-Hon Chen Institute for Global Real Estate Finance at the New York University Stern School of Business, emphasized that freezing rents without mitigating expenses for landlords would have dire effects beyond the current rent-stabilized housing supply.<\/p>\n

\u201cGiven the requirement for affordable units in new construction and office-to-residential conversions, a freeze on rent increases would almost certainly have a chilling effect on new development activity,\u201d said Chandan.\u00a0\u00a0\u00a0<\/p>\n

To that end, development activity is another area where Mamdani has made claims, including a declaration that he will seek to build 200,000 new residential units over the next decade with a concentration on permanently affordable housing. This includes a promise that \u201cany 100 percent affordable development gets fast-tracked\u201d as part of a $100 billion housing commitment that, Mamdani proposes, will be paid for through municipal bonds, pooled rental assistance, and activation of city-owned buildings and land.<\/p>\n

Patchett believes that Mamdani\u2019s housing plan<\/a> does a solid job of addressing the issues that need to be addressed to create more affordable housing throughout New York City, including slashing permitting delays, maintaining staffing levels at city agencies, and cutting through bureaucratic quagmires.<\/p>\n

\u201cI\u2019m really encouraged by those parts of his plan,\u201d said Patchett. \u201cHe says that he\u2019ll fully staff the housing agencies, including Housing Preservation and Development (HPD) and the New York City Housing Authority<\/a> (NYCHA). He said he will put in a substantial amount of capital funding for new development of affordable housing, and that he will look at the process through which OMB, the Office of Management and Budget, delays approval of capital funding for individual housing projects.\u201d<\/p>\n

Patchett makes the essential point that all of these things are \u201cwithin mayoral control.\u201d<\/p>\n

\u201cUltimately, it\u2019s a question of how much availability of capital the city has,\u201d said Patchett, \u201cbut there\u2019s every reason to believe that he can do all of those things.\u201d<\/p>\n

Glen concurred, noting that much of the mayor\u2019s effective power occurs in the realm of housing.<\/p>\n

\u201cThere are a couple of areas where the mayor can have a real impact in a tangible way without a lot of legislative action or haggling,\u201d said Glen. \u201cThe choices that the city makes about what kind of housing projects to support and how those are financed are very much within the control of the mayor.\u201d<\/p>\n

It\u2019s worth noting that while Mamdani withheld public support until Election Day, he did vote in favor of city ballot measures 2 through 4<\/a>, all of which are designed to speed up the approval processes for new housing developments.<\/p>\n

By way of example, Glen cites the difference between the priorities of Mayor Michael Bloomberg and those of his successor, Mayor de Blasio.<\/p>\n

\u201cThe Bloomberg administration chose to finance certain kinds of projects that they would call mixed-income \u2014 80\/20 projects. When we got into office, we wanted a different mix, so we directed the agencies to focus on those kinds of projects,\u201d said Glen. \u201cOne thing the mayor can absolutely do on day one is say, \u2018These are the kinds of projects I really care about,\u2019 like senior housing, low-income housing, or middle-income housing. The mayor can say, \u2018I am directing you to launch programs and start doing deals this way.\u2019 That\u2019s a very real thing. We did it, and every administration does it to some degree.\u201d<\/p>\n

A few of the ways Mamdani is proposing to pay for much of his agenda include raising the corporate tax rate to match New Jersey\u2019s 11.5 percent, which he said within his platform<\/a> will bring in $5 billion, and by imposing a 2 percent flat income tax on city residents earning over $1 million per year.<\/p>\n

Here, success may be harder to achieve, as raising these taxes is largely a state issue.\u00a0<\/p>\n

\u201cThat kind of tax change would require legislative approval, and the governor has signaled that she would not be amenable to that,\u201d said Chandan. \u201cWe also want to be careful of taking steps that might erode the tax base in New York City. These kinds of things do have, at least on the margin, an impact on the fiscal competitiveness of a city.\u201d<\/p>\n

This caution feeds into threats that many high-earners and high-net-worth individuals would leave the city if Mamdani was elected mayor. In addition to some in real estate threatening to beat a hasty exit to South Florida, England\u2019s The Daily Mail ran a story<\/a> the day before Election Day citing a conservative British polling firm, in a survey the Mail commissioned, claiming that an astonishing 765,000 New Yorkers, or around 9 percent of city residents, would \u201cdefinitely\u201d leave the city if Mamdani were elected.<\/p>\n

Of course, what could potentially happen is often quite different from what has actually happened in comparative circumstances.\u00a0<\/p>\n

In 2022, Boston voters passed a tax<\/a> similar to the one Mamdani has discussed, mandating that taxpayers who earn over $1 million a year have their rate on any taxable income over $1 million raised from 4 percent to 9 percent. Rather than driving an exodus, the Institute for Policy Studies, a progressive research group, found that the number of Boston residents making at least $1 million per year has actually increased 40 percent since the law took effect, according to WBUR<\/a>.\u00a0<\/p>\n

While New York Gov. Kathy Hochul has declared the raising of taxes a \u201cnon-starter,\u201d Kasirer believes the political moment might yield some surprising results in that area, especially since Hochul faces a potentially tough re-election campaign next year.<\/p>\n

\u201cI think it remains to be seen where the legislature and the governor are going to be on that issue,\u201d said Kasirer. \u201cI suspect that this is a very high priority for [Mamdani], not because he just wants to tax people, but because there\u2019s a recognition that the money for some of the programs he\u2019s talked about has to come from somewhere.\u201d<\/p>\n

Kasirer believes this could result in some surprising outcomes.\u00a0<\/p>\n

\u201cI think there\u2019s going to be a tremendous amount of pressure in Albany,\u201d said Kasirer. \u201cWe have to recognize that in 2026, there will be a lot of folks running for office on a similar platform to Mamdani\u2019s, and some of them are going to win. That\u2019s going to create more elected officials that might support a Mamdani agenda. I\u2019m not saying Gov. Hochul will agree with him, but there will be a different environment.\u201d\u00a0<\/p>\n

Until then, Barowitz sees shifting political winds as more likely to work against Mamdani than in his favor regarding taxation.<\/p>\n

\u201cGetting Albany to raise taxes in an election year is very difficult,\u201d said Barowitz. \u201cAnd, for the business community, that\u2019s something they are opposed to and fearful of. They worry this would exacerbate companies and people leaving New York City.\u201d\u00a0<\/p>\n

Some, of course, are far less optimistic about Mamdani\u2019s ability to effect change of any sort.\u00a0<\/p>\n

Political consultant Hank Sheinkopf has worked on roughly 700 political campaigns throughout his career for the likes of Bill Clinton, Michael Bloomberg and Mexico\u2019s former president Vicente Fox.\u00a0<\/p>\n

Sheinkopf believes Mamdani is in for a rude awakening once he takes office.<\/p>\n

\u201cThe crazy argument he\u2019s making is that he can somehow restructure government. But the problem he\u2019ll face is that he has no money to do it,\u201d said Sheinkopf. \u201cThe state is operating at a significant shortfall, and so is the city. And as that city shortfall increases \u2014 because there will be a disinvestment, unquestionably so, there\u2019ll be some panic \u2014 he\u2019s going to have problems making the budget on July 1.\u201d<\/p>\n

Sheinkopf also believes Mamdani will have significant problems negotiating with the city\u2019s unions.<\/p>\n

\u201cHe has union contracts he\u2019s going to negotiate,\u201d said Sheinkopf. \u201cHe has this delusional idea that unions are his friends, but they\u2019re not. This is an adversarial relationship that is simply about ensuring that workers get their due.\u201d<\/p>\n

And, while many are focusing on Mamdani\u2019s potential impact on real estate, Sheinkopf believes that real estate\u2019s reaction to Mamdani will be at least as significant.<\/p>\n

\u201cIt all depends to some extent on what the REITs do in the first quarter,\u201d said Sheinkopf, referring to the big publicly traded landlords. \u201cThey may cut their investments without saying anything. If they do that, then they would reduce revenue for the first quarter and even for the second. The city\u2019s budget gets struck on July 1. The city won\u2019t pick up the loss of revenue until the second quarter, and by then it\u2019ll be too late.\u201d<\/p>\n

Time will tell whether the predictions of Mamdani optimists or naysayers are closer to the mark.\u00a0<\/p>\n

Asked about the most potentially productive aspect of Mamdani\u2019s campaign, Glen declared it to have been Mamdani himself.<\/p>\n

\u201cWhat I think is the most productive and interesting thing is his very existence,\u201d said Glen, \u201cbecause what he represents is a breath of fresh air, and an acknowledgment that New York City, as it has always been over 300 years, is a different place than it was, and that new leadership, new ideas and new energy need to be brought into the political discourse in a very practical way.\u201d<\/p>\n

Larry Getlen can be reached at lgetlen@commercialobserver.com<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"After months of hand wringing, binge drinking, and apocalyptic thinking among the commercial real estate elite, the dire…\n","protected":false},"author":2,"featured_media":31230,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[38],"tags":[19001,80,9894,128,19002,19003,7845,426,12363,9,24,63,19004,19005,129,131,130,82],"class_list":{"0":"post-31229","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-the-bronx","8":"tag-alicia-glen","9":"tag-andrew-cuomo","10":"tag-bill-de-blasio","11":"tag-bronx","12":"tag-hank-sheinkopf","13":"tag-james-patchett","14":"tag-jordan-barowitz","15":"tag-kathy-hochul","16":"tag-michael-bloomberg","17":"tag-new-york","18":"tag-new-york-city","19":"tag-nyc","20":"tag-sam-chandan","21":"tag-suri-kasirer","22":"tag-the-bronx","23":"tag-the-bronx-headlines","24":"tag-the-bronx-news","25":"tag-zohran-mamdani"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts\/31229","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/comments?post=31229"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts\/31229\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/media\/31230"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/media?parent=31229"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/categories?post=31229"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/tags?post=31229"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}