New York City Proposes First Pied-à-Terre Tax on Luxury Second Homes

On April 15, 2026, Governor Kathy Hochul and Mayor Zohran Mamdani unveiled a city-wide surcharge on non-primary residential units valued above $5 million. The annual levy, called a “pied-à-terre” tax, is projected to raise roughly $500 million each year to address the city’s budget deficit. Officials have not released the final rate schedule; a 2019 draft suggested graduated rates of 0.5 % to 4 %.

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Mayor Mamdani said the tax targets “the richest of the rich” who keep high-value units vacant, and pledged that the revenue will fund cleaner streets, safer neighborhoods and free child-care. Governor Hochul affirmed the $500 million estimate and indicated the surcharge will be incorporated into the state budget. Both officials framed the measure as a fairness correction for out-of-state owners.

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City estimates place the tax on about 13,000 homes. Miller Samuel identified 4,146 Manhattan apartments sold for $5 million or more in the past five years, with roughly 70 % serving as non-primary residences. Citadel’s planned 350 Park Avenue redevelopment, valued at $6 billion, would create 6,000 construction jobs and over 15,000 permanent positions. Citadel employees have paid about $2.3 billion in New York taxes, and Griffin has contributed $650 million to local charities.

Citadel pushes back after Ken Griffin's penthouse used to tout New York pied-à-terre tax

Citadel’s chief operating officer Gerald Beeson called the mayor’s targeting “shameful” and warned the tax could spawn a new “cottage industry” for appraisers. Investor Bill Ackman argued that out-of-state owners “are not a drain on city services” and warned the policy could drive investment away. Real-estate lawyers anticipate extensive litigation over valuation and residency rules.

Citadel pushes back after Ken Griffin's penthouse used to tout New York pied-à-terre tax

New York’s property-tax system undervalues co-ops and condos, leaving the method for calculating the new surcharge unclear. Griffin’s 220 Central Park South penthouse is assessed at $6.99 million, listed at $15.5 million and was bought for $238 million, meaning it would fall below the $5 million threshold under current assessments. No rulemaking timetable has been announced, and the tax’s legal defensibility remains unsettled.

Citadel pushes back after Ken Griffin's penthouse used to tout New York pied-à-terre tax

• “The administrative costs haven't been thought through,” — Jonathan Miller, CEO, Miller Samuel

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• “It is shameful that he used Ken's name as the example of those who supposedly aren't carrying their fair share of the burdens associated with New York City's often costly and wasteful spending,” — Gerald Beeson, COO, Citadel

Citadel pushes back after Ken Griffin's penthouse used to tout New York pied-à-terre tax

• “When I ran for mayor, I said I was going to tax the rich. Well, today we’re taxing the rich,” — Zohran Mamdani

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• “Mamdani likes the tag line 'Tax the rich.' Unfortunately, his policies will harm the constituencies he is supposedly trying to help,” — Bill Ackman

Business Insider

The surcharge must be approved by the New York State Legislature and is expected to face legal challenges over valuation and residency rules. If enacted, it could reshape the market for high-end second homes and affect Citadel’s $6 billion 350 Park Avenue project. Stakeholders await the legislature’s decision later in 2026.

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