Billionaire Warns NYC Could "Become Mumbai" Under Mayor-Elect Mamdani's Policies

Barry Sternlicht indicated his New York team is evaluating potential relocation from the city.

Real estate magnate Barry Sternlicht has issued a stark warning that New York City risks resembling Mumbai under the leadership of incoming mayor Zohran Mamdani, a Democratic socialist scheduled to assume office on January 1.

Sternlicht, Chairman and CEO of Starwood Capital Group, revealed to CNBC that his company is contemplating moving operations away from New York following Mamdani's electoral victory. He suggested that additional businesses may similarly exit the city, citing what he characterizes as increasing costs and policies unfavorable to commercial enterprises.

Starwood Capital Group, which possesses substantial commercial and residential property holdings throughout New York and maintains offices in Midtown Manhattan, has historically engaged in significant development initiatives. However, Sternlicht explained that compulsory union regulations and rising project expenditures are deterring further investments.

"Projects exceeding $100 million in New York must employ union labor, which is extraordinarily costly. This results in exceptionally expensive housing. While some developers have attempted to negotiate with unions, these organizations dominate New York, representing a primary factor why blue states are so expensive and face such difficulties in expanding housing supply," Sternlicht stated during his CNBC Property Play interview.

"When the far left adopts extreme positions declaring tenants needn't pay rent—while landlords cannot evict non-paying tenants—this creates a contagion effect. One neighbor discovers another isn't paying, then they stop paying, followed by others, essentially transforming New York City into Mumbai."

Sternlicht's observations highlight apprehensions among certain business executives who fear new regulatory measures could impede growth and investment opportunities. Mamdani's office has not yet responded to these comments.