Key Takeaways:
Billionaire Ken Griffin put the future of a $6 billion Manhattan office tower in jeopardy, stating New York “doesn’t welcome success” after the city’s mayor used his home in a video promoting a new tax on luxury properties.
“The ugly, unnecessary video stunt was personal to Ken, and sort of personal to me, too,” Vornado CEO Steven Roth, Griffin's partner on the project, said on an analyst call, calling the mayor's actions "irresponsible and dangerous."
The proposed 53-story tower at 350 Park Avenue, a joint venture where Griffin holds a 60% stake, is now under internal review at Citadel. The hedge fund, which was set to occupy 850,000 square feet, is simultaneously revising plans to build a larger headquarters in Miami, where Griffin has relocated.
At stake for New York are 6,000 construction jobs and 15,000 permanent jobs tied to the development. The public clash threatens to chill corporate investment and sends a powerful signal about the city's political risk, potentially impacting the commercial real estate market as major employers weigh their options.
The controversy began when Mayor Zohran Mamdani posted a video on April 15 to announce a "pied-à-terre tax," an annual fee on homes worth more than $5 million that are not primary residences. The video was filmed in front of 220 Central Park South, where Griffin purchased a penthouse for a record $238 million in 2019.
Griffin, speaking at the Milken Institute Global Conference, called the video "creepy and weird" and ultimately "frightening," referencing recent violence against corporate executives. He said the incident was "triggering the trauma" he experienced in Chicago, a city he famously left citing crime and political leadership.
In response to the video, Citadel's Chief Operating Officer, Gerald Beeson, sent a memo to staff suggesting the firm might reconsider the 350 Park Avenue project. While demolition on the existing building has already started, Vornado's Roth confirmed the project's status is now uncertain. Vornado, which holds a 36% stake, has until July to decide whether to remain in the joint venture, for which Griffin has already provided a $400 million bridge loan.
Mayor Mamdani's office defended the tax proposal, stating the city's tax system is "fundamentally broken" and must be reformed to ensure the wealthiest New Yorkers contribute "their fair share." However, the move has drawn criticism for personalizing a policy debate and potentially driving away major employers. Former Mayor Eric Adams called on Mamdani to apologize, arguing the video "traded thousands of real, good-paying jobs in our city for social media likes."
While Griffin told CNBC he will "probably go through with" the New York building, he emphasized that Citadel's future growth will be concentrated in Florida. "We will add far more jobs in Miami over the next decade as an immediate and direct consequence of the mayor’s poor decision," Griffin said, confirming he had just revised building plans to add "several hundred square feet" to the firm's Miami tower.
This article is for informational purposes only and does not constitute investment advice.
