Billionaire real estate investor Barry Sternlicht, chairman and CEO of Starwood Capital Group, has sharply criticised New York City’s new mayor Zohran Mamdani, warning that the city could “turn into Mumbai” under his proposed rent freeze policy.
Sternlicht slams rent freeze proposal
In an interview with CNBC’s Property Play, Sternlicht reacted to Mamdani’s win and his proposal to freeze rents amid stagnant tenant incomes. The real estate mogul, who has both commercial and residential holdings in New York, argued that such policies would cripple the city’s housing market and deter investment.
“When one neighbour finds out that their neighbour is not paying, they stop paying too — and then NYC will turn into Mumbai,” Sternlicht said, criticising what he described as a “far-left” approach to housing.
He added, “Over $100 million, every project in New York has to go union, and it’s super expensive. That leads to extremely expensive housing. Other developers have tried to cut deals with the unions, but they rule New York. That’s one of the key reasons blue states are so expensive and why it’s so difficult to add supply.”
Developers warn of worsening housing crisis
Sternlicht emphasised that rent freezes are not a sustainable solution, calling instead for increased housing supply through government subsidies and greater flexibility in union work laws.
“The core issues are not what he’s focusing on. We need to increase housing, but that won’t happen easily. You need serious subsidies from the government if they want us to work with unions. The unions must be more accommodative on work laws and wages — otherwise, you can’t add economically,” he said.
The real estate investor also revealed that his team is considering leaving New York City due to rising operational costs and policy uncertainty.
Political backlash intensifies
Mamdani, who ran on a progressive housing agenda, has already drawn criticism from business groups and conservative leaders. Following his victory, Team Trump reportedly moved to strip Mamdani of his US citizenship, calling his policies “anti-capitalist.”
Sternlicht’s remarks add to the growing debate over the city’s housing future as major investors reconsider their commitments to the region.
‘New York will survive, but get worse first’
Despite his strong criticism, Sternlicht expressed optimism that New York City would eventually recover, albeit after a difficult period.
“New York will survive, but it will get worse before it gets better,” he said. “People are working really hard. The better message for a leader is to help others believe in the American dream — not just tax those who’ve been successful and drive them out, forcing the city to rely on Washington for handouts.”