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illionaire real‑estate magnate Barry Sternlicht, CEO of Starwood Capital Group, has warned that New York City will face a “really tough time” under newly elected socialist mayor Zohran Mamdani. Sternlicht told CNBC that union‑driven costs already push development and management fees to record highs, and he fears they will rise further with Mamdani’s agenda.

    “Every project in New York must go union, and that costs over $100 million,” Sternlicht said. “It makes housing extremely expensive.” He added that developers who have tried to negotiate with unions find them entrenched, a factor he cites for the high cost of living in blue‑state cities and the difficulty of adding housing supply.

    Sternlicht also criticized Mamdani’s plan to freeze rents in rent‑stabilized units. “If tenants can’t pay, landlords can’t evict, and the chain of unpaid rents could spiral, turning the city into a Mumbai‑style rent‑free zone,” he warned. He argued that the mayor’s focus on rent control ignores the need for more housing and that only substantial government subsidies could make union‑friendly development viable. “Unions must also be more flexible on labor laws and wages, otherwise economic growth stalls,” he said.

    The investor noted that he has not spoken to Mamdani and did not support former governor Andrew Cuomo’s campaign. He is already weighing moving Starwood’s Manhattan office out of Midtown, citing Mamdani’s socialist rhetoric and the growing frustration with New York’s success.

    Public safety emerged as a top concern. Sternlicht recalled Mamdani’s past calls to “defund the police.” “If people feel their children aren’t safe on the streets, they’ll pull them out of school and leave the city,” he said. “Defunding the police or failing to honor them could spell a very difficult future for New York.”

    Sternlicht’s remarks were made during CNBC’s “Property Play” interview, which will air in full next week. He emphasized that the core issues—housing supply, union costs, rent policy, and public safety—must be addressed if the city is to thrive under Mamdani’s leadership.