Last week, the NYC Department of Finance began doing the grunt work to actually enforce the City's new "pied-à-terre tax," which involves identifying the properties that qualify and telling owners what they owe.
As predicted, the enforcement of the pied-à-terre tax is no easy task. Many of New York City's most expensive properties are vastly undervalued due to the City's arcane property tax system. At the 220 Central Park South building where Citadel CEO Ken Griffin owns a $238 million penthouse, the most expensive property is only valued at $15.5 million, according to the City data. And the tax itself is under scrutiny because of how much it has hurt billionaires' feelings. (Remember Griffin accusing Mamdani of doxxing him at his building that was already totally public, "triggering" his "trauma"?)
The DOF's bureaucratic process turned into a minor shitshow this weekend, when the agency did what it is legally required to do on an annual basis, and published a "market value roll" of New York City properties. This is the first administrative step of several steps to come, and allows property owners to see how the City has valued their property (and start mounting a defense if they think it's incorrect). But when the public started looking at a list of properties the City said could be subject to the pied-à-terre tax, many people got very confused indeed, and some even accused the City of publishing "a hit list" for rich people.
Quick refresher: In April, Governor Kathy Hochul and Mayor Zohran Mamdani announced they would be "taxing the rich" through a new law that would allow the City to levy a yearly surcharge on luxury second homes (like those condos on Billionaires' Row that sit empty nine months out of the year). The surcharge was predicted to raise an estimated $500 million annually, from about 10,000 pieds-à-terre. Under the new law, Class 1 properties (one-, two-, and three-family homes) valued at $5 million or more will pay a surcharge of between 0.8 and 1.3 percent, while Class 2 properties (condos and coops) valued at $1 million or more will be hit with a surcharge of between 4 and 6.5 percent.
So last week, the agency issued a data dump of Class 1 and Class 2 properties in NYC, without filtering it at all. The list—which was mostly already publicly available—totaled almost a million property records. The DOF didn't remove homes valued at less than $5 million, or condos less than $1 million. It didn't remove homes that are clearly people's primary residences. It didn't even remove properties that are owned by the City itself. Still, after a tweet began to circulate noting that the list existed, some people freaked out that the City was "doxxing" potential pied-à-terre owners.
This, of course, is ridiculous, but it is possible that inquiring minds could try to organize the list as I did (yes, with the help of Claude), at least by removing properties that don't meet the financial threshold for a pied-à-terre tax. I was able to narrow it down to a universe of about 24,300 homes that could be subject to the tax, including 17,500 condo and co-op apartments. We don't know yet what proportion of those properties are the primary residences of New Yorkers. Indeed, scanning the list, a handful of names of known full-time New Yorkers (in a mass of LLCs) jump out: billionaire Leonard N. Stern with his $37 million 5th Avenue manse, Jenica Paulson, the ex-wife of billionaire hedge-fund manager John Paulson, who recently got their UES home (valued at $78 million) in the divorce, and Jerry Speyer of Tishman Speyer who lives in a lovely limestone spot off Lexington Avenue valued at $18.7 million.
But it's still fun to search the addresses of people we suspect have pied-à-terres, imagine how the 1 percent lives, see how much the city has valued their second home at, and then picture them handing over that sweet, sweet, surcharge. For example, the most expensive potential pied-à-terre is 7 East 72nd Street, which the City values at $112 million. This parkside mansion with an indoor swimming pool and 8,500-square foot rooftop terrace was reportedly purchased by Qatar in 2002 to be the NYC pad of Sheikha Al-Mayassa bint Hamad bin Khalifa Al Thani, who lives in Doha. How much would a second-home surcharge for the princess be? About $1.5 million.