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New York City's real estate industry is engaging with mayor-elect Zohran Mamdani amid his plans to freeze rents and boost housing development. Industry leaders are concerned that a rent freeze for rent-stabilized apartments could hinder building maintenance, reduce investment, and strain over 200,000 affordable units already facing financial challenges. Despite this, some developers see potential for collaboration, emphasizing that Mamdani recognizes rising costs and aims to support landlords alongside tenants. The industry is seeking dialogue to implement policies that balance affordability with sustainable development and investment.
Members of New York City's real estate industry are preparing for the potential impact of the policies introduced by mayor-elect Zohran Mamdani, particularly his focus on affordability and housing development. Industry representatives are now looking to engage with Mamdani as he moves forward with plans to freeze rents and promote development across the city. Advertisement
The real estate sector has expressed concerns that freezing rents for rent-stabilized apartments could limit property owners' ability to maintain and renovate buildings. This, in turn, could reduce investment interest in these properties. David Dworkin, president and CEO of the National Housing Conference, said that the most effective approach for the mayor-elect would be to meet developers and managers of affordable housing to understand what they need to expand housing opportunities. He also highlighted that his organization has members actively involved in New York housing who can provide guidance.
Mamdani's recent election victory was driven largely by young voters, newcomers, first-time voters, and renters, many of whom were motivated by his proposals to lower the city's high living costs. While the mayor does not directly control rent prices, Mamdani can influence the Rent Guidelines Board, which sets limits for rent-stabilized apartments, and also has authority over zoning for new developments and the city budget.
Previous efforts to impose a rent freeze, such as those initiated by former Mayor Bill de Blasio, were later reversed by outgoing Mayor Eric Adams. Kenny Burgos, CEO of the New York Apartment Association, stated that it is unlikely the Rent Guidelines Board would approve a rent freeze even if Mamdani appoints new members. Burgos highlighted that over 200,000 affordable housing units are already facing financial strain due to rising costs, and a rent freeze could worsen the situation.
Research from the Rent Guidelines Board showed that the net operating income of affordable housing built before 1974 declined by 9% in nominal terms between 2020 and 2023, with losses exceeding 25% for buildings outside Manhattan. Burgos emphasized that such data illustrates the challenges faced by these properties.
Major real estate firms supporting affordable housing, including Blackstone, Brookfield Properties, Pinnacle Realty, and SL Green Realty, have not commented publicly on Mamdani's policies. Some industry voices, however, believe there is potential for collaboration. Jesse Batus, Senior Vice President at the Community Builders, noted that the mayor-elect intends to implement rent freezes without disadvantageous landlords and that rising costs are recognized in the policymaking process.
Mamdani has pledged to freeze rents for over 2 million rent-stabilized tenants. David Funk of the American Real Estate Society expressed concern that these policies could reduce investment appeal not only in affordable housing but also in commercial real estate due to potential profit constraints.
Industry leaders are seeking to work constructively with the new mayor. James Whelan, president of the Real Estate Board of New York, said the organization is ready to collaborate on housing affordability and other city challenges. Paul Rahimian, CEO of Parkview Financial, welcomed discussions on strategies to help residents manage living costs. Kathryn Wylde, CEO of the Partnership for New York City, noted that Mamdani's pro-development stance and commitment to increasing housing supply has offered some reassurance to the industry.
Source Reuters
5th Jun, 2025
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