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New York Elections

11/12/2025

November in the USA means Thanksgiving, Black Friday, Veterans Day, baseball (yes, really – ten World Series since 2000 have ended in November, including the most recent edition, when the LA Dodgers triumphed over the Toronto Blue Jays in game 7 on November 1st) – and elections.

Last year was the big one, of course – the Presidential election. But this year, while certainly nowhere near as high profile, the New York mayoral election and the Virgina and New Jersey gubernatorial elections each commanded significant column inches in the news media – and plenty on social media platforms as well.

It’s the New York election that has most in the US private funds space talking. Democratic candidate and NYC mayor-elect Zohran Mamdani has said that he would increase taxes on the wealthiest New Yorkers to fund some of his policies, which in turn have led many commentators to predict an exodus of talent from the Big Apple to more ‘tax-friendly’ states.

If said migration were to happen, it wouldn’t be a new trend. Back in 2023, a Bloomberg article suggested that approximately $1trn worth of assets had left New York and California for pastures new, which means, other things being equal, less tax receipts for those states as a result.

That’s corporations, of course, not people (at least, not directly). But there is evidence to suggest that the finance industry in New York is shrinking in terms of the percentage of inhabitants that work in it: Just 7.7% this past August, according to The Economist. Part of the reason will be slower growth in the number of jobs in New York’s finance industry, and part will be higher growth in other cities, relocating some existing workers.

The extent to which New Yorkers do or don’t leave the city during Mamdani’s term is difficult to predict. Firstly, certain tax rises in the Empire state require state senate and/or governor approval – which does not appear to be guaranteed as incumbent NY governor Kathy Hochul told the Raging Moderates podcast recently that she was “concerned about outmigration of people who are the ones who are supporting our budget.”

Second is the fact that just because a private fund adviser leaves a state doesn’t mean that the workers will. The emergence and stickiness of remote work in the aftermath of the Covid-19 pandemic means that a company can relocate to a state where corporation tax is lower, but its employees can still work from where they currently live.

Which leads into something we can measure – whether private fund advisers do indeed jump ship in the near future. The vast majority of private fund advisers in the US file their annual Form ADV in the first quarter of the calendar year because the deadline for doing so is 90 days after the end of their financial year – which, for most, is December 31st.

Which means that in early April, we will be able to see which advisers do move between now and the end of the year.

That’s a short window, however. And plenty might want to play a game of wait-and-see, given the aforementioned apparent hesitance of the governor to support tax increases.

And even with political will, New York’s legislative machinery isn’t built for sudden tax shifts. Any new city income tax on high earners would almost certainly need to be negotiated as part of the 2026 state budget cycle, meaning that the soonest New Yorkers would see such a change would likely be mid- to late-2026.

That means the true extent to which private fund advisers and their employees leave New York – or not – won’t be known until April 2027. While anecdotal evidence will emerge before then, those bigwigs in the New York alternative investment space who want to remain there will no doubt be hoping that Governor Hochul’s apparent hesitancy to agree to tax hikes turns out to be a very real roadblock.

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