The Republican tax reform plan passed the House of Representatives Thursday, but some of New York’s leading real estate executives aren’t thrilled about the proposed changes.
“I think it has serious implications for this city and for young urban professionals that want to live here and raise families here,” said Forest City New York’s CEO Maryanne Gilmartin. “I am very concerned. We talk about external factors, black swans, orange swans, whatever you want to say, I think this has the ability to really have a pretty sizable impact on the near-term prosperity of New York.”
Gilmartin, speaking at NYU Schack Institute’s annual conference on capital markets in real estate Thursday, was referring to the GOP’s plans to lower the cap for the mortgage-interest deduction to $500,000, which would make it harder for Americans in expensive markets like New York to afford to buy homes. Another cause of concern are plans to end a provision that allowed New Yorkers to deduct state taxes from their federal taxes.
Related Companies’ chair Stephen Ross said the change may not hurt New York as much as it would have in the 1980s, when the ending the deductibility of state taxes was also considered, because taxes in New Jersey and Connecticut are higher today.
“I don’t think it will be as bad as we thought it would be in 86,” he said. He said that the proposed reform “creates challenges” for New York but also cautioned that he doesn’t think it’s likely to pass.