RESOLVING THE LEDGER
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One filmed a widely regarded publicity “stunt” outside the other’s $238 million penthouse. The latter responded by telling the former he was doxxing him, told him to read a history book, and waved a major $4.5 billion project over the former’s head. Months passed, a new tax was introduced, and fans of both sides charged the other. And after all this back and forth, nothing changed.
Ken Griffin’s public feud with New York City Mayor Zohran Mamdani has not stopped Citadel from doubling down in Manhattan. The past few months have been a point of contention for the Citadel CEO and the young self-described democratic socialist mayor of the nation’s biggest city, complete with video callouts and threats to remove Citadel’s funding of a major Midtown skyscraper. But according to a Tuesday morning earnings call from Vornado CEO Steven Roth, Citadel will carry forward with the 350 Park Avenue redevelopment after all.
Citadel is expected to remain involved in the project as a “60% partner,” Roth said on the call. “Citadel as our 1-million-square-foot anchor tenant.”
Roth’s comments solidify Citadel’s presence in New York—with the company verifying the comments made on the call to Fortune —despite the ongoing public spat between its CEO and the city’s mayor.
The battle of the heavyweights
The decision to remain in New York represents a notable reversal from the rhetoric that ensued following Mamdani’s April announcement of the pied-à-terre tax. In what Griffin later dubbed a “weird” stunt by the mayor, Mamdani released a Tax Day video announcing a pied-à-terre tax on any secondary homes valued at over $5 million. Referencing the CEO by name, the young mayor stood outside Griffin’s $238 million home, listing ways the new policy would generate tax revenue for the city.
What followed was a volley of backlash against the mayor for the video, which Griffin described as “creepy” and “frightening.” Griffin’s COO at Citadel, Gerald Beeson, was the first to threaten Citadel’s possible withdrawal from the skyscraper.
A week after the video was released, Beeson wrote in a letter : “We are about to commence the redevelopment of 350 Park Avenue, creating 6,000 highly paid construction jobs and supporting the creation of more than 15,000 permanent jobs in Midtown New York.
“The project—if we move forward—will entail more than $6 billion dollars of spending.”
Roth himself also commented on the video, saying it was an “ugly and unnecessary … stunt” and that he was “shocked that our young mayor would pull this stunt in front of Ken’s home and single him out for ridicule.”
It’s hard to leave the financial capital of the world
The then-dangling threat seems all the more hollow when you factor in how New York City is still in all respects the center of the financial world.
“It’s not always that easy just to give up New York City, especially if your family’s there, if your business is there,” Nick Montorio, partner at EisnerAmper, told Fortune . “The benefits of being around New York City for most of our clients and those businesses usually outweigh the negatives.”
Griffin said previously that he believes New York City will be the hedge fund’s long-term home.
“Citadel will be a principal player in financial services for far longer than [the mayor] will be mayor,” he said. “We intend to be here for decades. And he will be here for a few years.”
Despite the mayor’s tenure, his policies may still remain in place after he leaves office—and that has plenty of implications for the city. For Montorio, the pied-à-terre tax is only one factor in a broader trend of wealthy individuals and businesses reconsidering their New York footprint. Following the pandemic, many firms expanded operations in states such as Florida after realizing portions of their workforce could operate remotely.
“We’ve seen that trend developing really forever, but COVID accelerated that,” he said. “This pied-à-terre tax just further pushes wealthy people in particular out of New York City.”
Still, he cautioned against assuming the loud criticism from New York’s elite automatically translates to departures.
“I would say our businesses regularly talk about … leaving New York City, but very few actually do,” Montorio said. “This is where the resources are. This is where the money is. This is where a lot of educated people reside.”
That dynamic helps explain Citadel’s latest move. According to a report by the New York City Economic Development Corp., the city’s private sector grew employment by nearly 55,000 year over year—and secured nearly $6.3 billion in VC funding. That growth and economic output makes it difficult for even the wealthiest CEOs to kiss the Big Apple goodbye.
The mayor himself sees the economic benefit, too. At a press conference in April, Mamdani said he wants Griffin to see success in the city, to make New York City benefit economically.
“I want New Yorkers to succeed,” Mamdani said. “I want them to build businesses, to grow our economy, and to create good-paying jobs, and Ken Griffin has been a part of that.”
This story was originally featured on Fortune.com
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