Mamoodi, 34, successfully overcame fierce opposition on Wall Street to win the New York mayoral election. He advocates for a millionaire surtax and higher corporate taxes. Prominent financiers such as Bill Ackman failed in their efforts to thwart his campaign and were compelled to shift their focus.
The heavyweights of Wall Street failed to prevent New Yorkers from electing a democratic socialist as mayor. What now?
By late Tuesday evening, when Zohran Mamdani's victory in the mayoral race was confirmed, a sense of defeat loomed over New York’s elite. Some of the city’s top financial figures had considered it unimaginable for Mamdani to take control of City Hall and spent heavily to support alternative candidates.
Now, they must collaborate with this new mayor and hope that their worst fears about the impact he will have on New York’s business environment do not materialize.
“This is more about public safety and quality of life. If these go in the wrong direction, it will be hard for any employer to attract and retain top talent,” said Ed Skyler, an executive at Citigroup and former deputy mayor under Mayor Michael Bloomberg.
Mamdani, 34, rose quickly from being an ordinary state legislator representing an outer borough district to becoming the city’s chief executive. He capitalized on widespread discontent among New Yorkers feeling squeezed by the high cost of living. He has proposed an additional 2% tax on millionaires and higher corporate taxes to fund free public transit, expanded childcare services, and municipally-run grocery stores.
Such policies are far from palatable to Wall Street. At first, Mamdani’s chances of winning seemed slim, but his unexpected victory in the Democratic primary in June shocked the financial sector and prompted them into action.
As the campaign intensified, companies like Apollo Global Management and Citadel urged their employees to vote. Hedge fund billionaire Bill Ackman spent over $2 million trying to stop Mamdani, and he was by no means the only one backing less competitive alternatives with significant funding.
“He spent more money opposing me than I plan to tax him for,” Mamdani said in a recent podcast episode, referring to Ackman. “Every day it was a million, a million — I don’t even want that much!”
In an unexpected twist, it was Ackman himself who extended an olive branch late Tuesday, posting a congratulatory message to Mamdani on X. “You have an enormous responsibility ahead of you. If there’s anything I can do to help New York City, please let me know.”
Other prominent figures, however, were in stark contrast. Cliff Asness, the billionaire hedge fund titan of AQR Capital, posted a scene from 'Planet of the Apes' on the X platform: Charlton Heston's character discovers the remnants of the Statue of Liberty on a beach, realizes that Earth has been destroyed, and shouts, 'You maniacs! You blew it up!'
Anthony Pompliano, a cryptocurrency evangelist and investor, added, 'A socialist just got elected mayor of the world’s financial capital, and that’s insane.'
Real estate developers and property owners reacted with similar frustration, strongly opposing Mammadani's proposal, which includes freezing rents for rent-stabilized apartments. Billy Macklowe, who recently launched a retail and residential project in Brooklyn, said he still plans to proceed with several new projects. 'Hopefully, the system won't be disrupted,' he remarked.
Historically, when New York City prospers, Wall Street benefits as well. The collaboration between Wall Street firms and New York City has helped repair broken infrastructure and clean up Central Park.
For those concerned about Mammadani's policies, random street crime is a primary concern. Murders dropped from a peak of over 2,000 in 1990 to 292 in 2017, the lowest level in modern times. According to a report by the State Comptroller’s Office, hate crimes in New York State rose by 12.7% in 2023, with nearly 44% of recorded hate crime incidents and 88% of religion-based hate crimes targeting Jewish victims.
To the slight relief of some business figures, Mammadani has indicated plans to invite New York City Police Commissioner Jessica Tisch to stay on. Tisch, a seasoned public servant and the daughter of a billionaire, is highly regarded in business circles for overseeing a significant drop in crime rates and handling incidents such as the July shooting at an office building in Midtown Manhattan that left four dead. Whether she will accept the invitation remains to be seen.
Rob Wiesenthal, CEO of on-demand helicopter company Blade, stated that if Mammadani fails to recruit and retain Tisch, it would be a bad sign.
According to a copy seen by The Wall Street Journal, Citadel hedge fund, run by billionaire Ken Griffin, sent an email in June urging its New York-based employees to vote and warning against 'candidates with extreme views that do not align with your values.'
Mammadani had previously criticized Israel and advocated for cuts to police funding, though he later softened his stance. Griffin moved Citadel from Chicago to Miami several years ago, citing Chicago's crime rate as a contributing factor.
Others are concerned about the potentially unstable relationship between Mammadani and Trump. Trump endorsed Mammadani's main opponent, former Democratic governor Andrew Cuomo, at the last minute. Trump threatened to send additional Immigration and Customs Enforcement agents and National Guard troops to New York City and withhold $18 billion in federal funds earmarked for infrastructure projects.
Antonio Weiss, former head of investment banking at Lazard, stated that the relationship between New York City and Washington could be the most immediate challenge. Unlike many of his peers in the financial industry, he supports Mammadani partly because of the latter’s focus on affordability for people's livelihoods.
For now, New York remains synonymous with wild ambition, one of the key forces that has long driven the dominance of the financial sector. On Park Avenue in Midtown Manhattan, JPMorgan recently held an inauguration ceremony for a new tower costing $3 billion. Jamie Dimon, the bank's CEO, who was born in Queens, is almost a mascot for the industry, vowing to stay in New York. Those who cannot endure the Mammadani era may have different plans.
Michael Gontar, CEO of real estate investment firm InterVest Capital Partners, is considering whether to remain in New York. A higher tax bill would not prompt him to leave, but he is skeptical about Mammadani’s plan to create a new agency prioritizing mental health services and violence prevention.
