New York
William Zeckendorf wants to build an army of NYC homeowners
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At Bezos condo, pol demands Amazon chief pay pied-à-terre tax
State Sen. Brad Hoylman claims new report on property tax reform will serve as “blueprint” from reviving his bill
State Sen. Brad Hoylman and a group of about 20 community organizers gathered outside 212 Fifth Avenue, calling on Amazon chief Jeff Bezos to pay more tax on his Flatiron pied-à-terre.
The group had a giant fake check — ostensibly from Bezos for $2.57 million — made out to the people of New York and a cake with lettering in icing that read “Alexa, how do we end homelessness?”
“We need to make sure that the wealthiest in New York City pay their fair share. That’s what it’s really about,” the senator said to cheers from the group. He then play-acted a real estate agent showing Bezos’ apartment to the Amazon founder.
“The master suite on the 17th floor is a dream,” he said, gesticulating dramatically. “There’s a private bedroom in the master suite. So, how many bedrooms do you know have a private bedroom within it? Well this one does. It’s seven rooms.”
The senator has been a proponent for additional taxes on luxury second homes for years. Though his bill has yet to make it out of committee, it got very close last year in the run-up to the state budget deadline on April 1. (Hoylman’s proposed annual levy on second homes would kick in for properties valued at $5 million.)
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William Zeckendorf wants to build an army of NYC homeowners
Industry backlash was swift last spring. Developers, brokerages and agents argued the annual tax would kill the city’s already soft luxury market, alienate well-heeled buyers and not bring in as much tax revenue as expected. Appraiser Jonathan Miller estimated last spring that properties valued at $25 million or more could see that valuation plunge 30 percent “overnight.”
Ultimately, the pied-à-terre tax was swapped out for larger mansion and transfer taxes after “technical difficulties” arose, as Assembly Speaker Carl Heastie put it. For instance, it was unclear how to tax an individual shareholder within a cooperative building, or differentiate primary residence homeowners who bought their properties via a limited liability company.
212 Fifth Avenue (Credit: StreetEasy)
Despite those issues, however, Hoylman and other politicians haven’t abandoned the idea. Hoylman said in September a bill to reintroduce the tax was in committee and, at the time, said he hoped it would be ready “for prime time” by January.
As he spoke at the Friday stunt outside 212 Fifth Avenue, Hoylman was holding a copy of the preliminary report released the night before by New York City’s advisory commission on property tax reform. The report recommends that all residential properties be valued using sales-based methodology.
Activists gathered outside 212 Fifth Avenue, calling on Amazon’s Jeff Bezos to pay more tax on his Flatiron pied-à-terre (Photo by Erin Hudson)
Though other tax reformers largely panned the report, Hoylman said he believes it will jump start his stalled bill and called it a “blueprint” for how to make his proposed pied-à-terre tax work. He said the pied-à-terre tax bill had not yet been revised.
“It basically endorses the concept that people who don’t live in New York City should be paying a different effective tax rate than those that do because it has a homestead exemption,” he said.
Earlier this week, it became known that William Zeckendorf is leading an effort to mobilize homeowners on the legislation. The Zeckendorf Development chief and Terra Holdings co-chairman had also personally traveled to Albany last spring to lobby against the bill, calling it unconstitutional and its underpinning economic analysis “alarming.”
Hoylman said his pied-à-terre proposal specifically targets people who are not New Yorkers. He added that in meetings with Zeckendorf, conversations center around unintended consequences on the market.
Activists gathered outside 212 Fifth Avenue, calling on Amazon’s Jeff Bezos to pay more tax on his Flatiron pied-à-terre (Photo by Erin Hudson)
The Real Estate Board of New York sent someone to observe the demonstration and provide a recap to members. Compass broker Jarrod Guy Randolph, who co-chairs REBNY’s New York Residential Specialist program, called Hoylman and the demonstration “misguided.”
“For the sake of politics, they’re trying to target a handful of millionaires,” he said. “It makes me sad that this is the political state that we are in.”
Write to Erin Hudson at ekh@therealdeal.com