Citadel and Citadel Securities have fired back at New York City Mayor Zohran Mamdani after he used billionaire Ken Griffin's $238 million Central Park South penthouse as a prop to advocate for a proposed annual surtax on high-end second homes. In a memo reviewed by the Wall Street Journal and Reuters, Citadel Chief Operating Officer Gerald Beeson accused the mayor of targeting Griffin personally and warned that the firm might walk away from a planned $6 billion redevelopment of 350 Park Avenue.
The proposed tax, dubbed a pied-à-terte levy, would impose an annual surcharge on non-primary residences in New York City valued at more than $5 million. Mamdani, a democratic socialist, posted a video on Tax Day alongside New York Governor Kathy Hochul to promote the measure, which officials estimate could generate roughly $500 million annually to help close the city's budget deficit. Specific tax rates and implementation timelines have not been released.
Beeson's memo, dated Thursday, took sharp aim at Mamdani's tactics. "It is shameful that he used Ken's name as the example of those who supposedly aren't carrying their fair share," Beeson wrote, according to reports. He noted that Citadel's principals and employees have paid nearly $2.3 billion in combined city and state taxes over the past five years, and that Griffin personally directed $650 million in charitable gifts to New York City.
The memo escalated tensions by linking the tax debate to a major development project. Citadel is preparing to begin redeveloping 350 Park Avenue, a project Beeson said would generate 6,000 construction jobs and support more than 15,000 permanent positions in Midtown. "The project – if we move forward – will entail more than $6 billion dollars of spending," he wrote, implying the firm's commitment is contingent on the tax outcome.
Griffin relocated Citadel's headquarters from Chicago to Miami in 2022, which is now his primary residence. The firm still maintains roughly 2,500 employees in New York. Billionaire investor Bill Ackman publicly supported Griffin, arguing on social media that non-resident apartment owners who leave units vacant do not strain city services and instead boost economic activity through retail, dining, and cultural spending. Ackman added that Citadel's presence underpins a significant portion of the city's tax base.
The proposed tax still requires approval from the state legislature and faces opposition from the real estate industry. Similar measures have been floated and defeated before, most recently in 2019. Even if it clears Albany, implementation would face considerable legal and administrative hurdles. Because New York's property tax system historically undervalues co-ops and condos relative to market prices, city officials would need to establish a new valuation framework for high-end second homes.
Griffin's penthouse at 220 Central Park South, purchased in 2019 for a then-record $238 million, is currently assessed by the city at just $6.99 million and listed at a market value of $15.5 million. Under existing assessed values, it would not qualify for the tax. Jonathan Miller, chief executive of appraisal and research firm Miller Samuel, told CNBC that the tax would trigger complex new demands on appraisers and attorneys. "The administrative costs haven't been thought through," Miller said, adding that the measure "could give birth to a whole new cottage industry." He estimated that about 70% of Manhattan properties that sold for $5 million or more over the past five years are non-primary residences, based on a review of roughly 4,100 transactions.
Owners seeking to minimize their tax exposure could also pressure appraisers to value apartments just below applicable thresholds. For financial advisors, the controversy underscores the risks of tax-driven capital flight and the importance of monitoring local tax policy changes for high-net-worth clients. As Griffin has previously warned, such levies could push wealthy individuals and firms to relocate, reshaping the advisor landscape. Meanwhile, the broader market context, including rising inflation and strong corporate earnings, may influence how clients view these fiscal pressures.
