Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: Gottie Wild, Great to see you. We're here in Hudson
Speaker 2: Yards at HSBC's new trading floor, shiny and new. But
Speaker 2: it really does send another message about Wall Street's ambition
Speaker 2: in New York. And I suppose there is the battle
Speaker 2: against Miami. But what do you think it says to
Speaker 2: the global community. I buy Hudson Yards and New York Finance.
Speaker 3: Well, no contest with Miami. Let's start there.
Speaker 1: But what it says really is that New York is
Speaker 1: constantly reinventing itself and Hudson Yards represents more than twelve
Speaker 1: million square feet of new office space built in New
Speaker 1: York in the last seven years, and it's basically renting
Speaker 1: like hotcakes at the highest commercial rents we've ever had,
Speaker 1: and the space is fantastic. Part of the motivation for
Speaker 1: that is that a lot of our older real estate
Speaker 1: needed to be rebuilt and so companies have relocated. But
Speaker 1: it also is because remote work has created a phenomenon
Speaker 1: where people want to come to a great place to
Speaker 1: work and getting people back to the office. Part of
Speaker 1: the secret sauce is having a place like Hudson Yards
Speaker 1: and a trading floor like the one you see here.
Speaker 2: And that's essentially what Michael just said. He's the HSBC CEO.
Speaker 2: He doesn't want to dictate people coming back. He wants
Speaker 2: people to come back to nucleus like this. But if
Speaker 2: I look at the commercial property empty spaces in New
Speaker 2: York that is at a record high, Katy. And the
Speaker 2: question is is the city doing enough to regenerate those properties,
Speaker 2: either for homes or regeneration full stop.
Speaker 1: Well, the state and city together just in the last month,
Speaker 1: has passed new legislation that creates the proper zoning and
Speaker 1: tax incentives for the conversion of our older commercial buildings
Speaker 1: to residential use. And downtown we saw that after nine
Speaker 1: to eleven, Remember everybody thought New York was going to
Speaker 1: be deserted, and with a very short period of time
Speaker 1: with incentives for how in conversion, it became the fastest
Speaker 1: growing residential community in the country.
Speaker 2: Do you think we can replicate that?
Speaker 3: Absolutely?
Speaker 2: So we're not on a doom loop.
Speaker 3: No, quite the contrary.
Speaker 1: I mean in New York, it really takes because property
Speaker 1: values are so strong here and the demand is so
Speaker 1: high that it takes a crisis to kind of free
Speaker 1: things up. And reinvent yourself. And that's what's exactly going on.
Speaker 1: So it's the opposite of a doom move. It's really
Speaker 1: the next plateau for the next era of New York's
Speaker 1: growth and prosperity.
Speaker 2: And here's the thing. Is a global city and it
Speaker 2: is it is destination number one for competal markers. But
Speaker 2: if we look at the two burning issues at a
Speaker 2: global level, one is affordability of heising. It's not just
Speaker 2: a New York problem. It's a global problem with cities
Speaker 2: and safety. I want to square away safety. The National
Speaker 2: Guard are on the subway. There's more police on the subway.
Speaker 2: Do you look at that as a reassurance or is
Speaker 2: actually things are getting pretty out of control here.
Speaker 1: We're still in recovery from the pandemic in terms of
Speaker 1: the subway's, subdy safeway safety. During the pandemic, when people
Speaker 1: were not traveling to work, when we had a lockdown,
Speaker 1: we had a period of time where there was a
Speaker 1: lot of takeover of the subways by what might say
Speaker 1: undesirable elements. We're losing a lot of money.
Speaker 3: Through fair evasion.
Speaker 1: Folks are moving into the subway and they're finding some
Speaker 1: opportunities for crime, and so.
Speaker 3: We need police in the subways.
Speaker 1: We've got a great programs in the case of people
Speaker 1: who are mentally ill who have moved into the subways.
Speaker 1: You know a lot of patients and prisoners were moved
Speaker 1: out of institutions during the COVID to prevent infection, and
Speaker 1: we've ended up they ended up many of them in
Speaker 1: the subways.
Speaker 3: So we are really working hard.
Speaker 1: The MTA has made this a top priority, and in fact,
Speaker 1: last month's subway subway crime was down substantially, so we're
Speaker 1: in the right direction on that.
Speaker 2: What does the city say when Mayor Adams will be
Speaker 2: here a little bit later on, I'm just wondering what
Speaker 2: you're gonna say to him in terms off does he
Speaker 2: need to do more on bail reform. I know there's
Speaker 2: political obstacles in Albany to this. You're the voice of
Speaker 2: this city. What are you going to say to him?
Speaker 1: Just to be clear, the state, not the city, is
Speaker 1: in charge of the laws controlling criminal justice. So Mayor
Speaker 1: Adams can as an advocate for stronger enforcement for criminal
Speaker 1: justice reform. But right now bail reform is really not
Speaker 1: so much of an issue. We've got issues in what's
Speaker 1: called discovery laws that were reformed that make it very
Speaker 1: difficult for the prosecutors, for the district attorneys to bring
Speaker 1: a case. So we've seen dismissal of cases go up
Speaker 1: fifty percent on technical grounds because of the laws, and
Speaker 1: that's where the challenge is. And I think we're going
Speaker 1: to make sure that something is done about that in
Speaker 1: the legislature next year to try and get that fixed.
Speaker 3: But it is a small course correction.
Speaker 1: We actually have a very balance criminal justice system, and
Speaker 1: we're working hard to make sure that we enforce it.
Speaker 2: The second issue is housing. Ninety five percent of New
Speaker 2: York's housing is technically unaffordable for workers on average wages.
Speaker 2: So let's talk about big New York, not the top
Speaker 2: one percent. What more, there's no quick fix on this.
Speaker 2: What more can New York and the city do in
Speaker 2: this regard converting older premises to housing? What are you advocation?
Speaker 1: Once again, it took a little extra time, like two years,
Speaker 1: but we have now past legislation which creates a new
Speaker 1: housing Production program, which provides for, as we mentioned before,
Speaker 1: the conversion of older commercial buildings to residential. It provides
Speaker 1: for upgrading illegal basement apartments so that they're safe and sanitary.
Speaker 1: It increases the zoning allowances so that higher density housing,
Speaker 1: more units can be built. We are on track to
Speaker 1: address our housing problem. As you say, there is a
Speaker 1: leg time, but we're definitely on track.
Speaker 3: It is top priority.
Speaker 1: We want that young talent to be able to move
Speaker 1: to New York and not have to live five to
Speaker 1: an apartment, so we're working hard on that issue.
Speaker 2: Do you think they're moving fast enough and hard enough.
Speaker 3: I think they're moving as fast as they can.
Speaker 1: Housing is tends to be an issue that is complicated
Speaker 1: because you have tenants rights versus landlord rights versus development rights,
Speaker 1: so it's a complicated issue.
Speaker 3: I'd love to get your opinion.
Speaker 2: We're going into full electioneering mode between now and November.
Speaker 2: What is the sentiment, what is the partnership talking about
Speaker 2: it in terms of the upcoming presidential election, highest risk
Speaker 2: and host opportunity.
Speaker 1: Well, I would say the upcoming presidential election. We're a
Speaker 1: little worried that all of president ex president Trump's criminal
Speaker 1: trials have been brought in New York, or several of them,
Speaker 1: so that you know, we're concerned that if he's elected,
Speaker 1: he not take it out on New York fully because
Speaker 1: he's a queen's boy from New York.
Speaker 3: He won't and I hope not. I'm just saying that's
Speaker 3: a worry go to York.
Speaker 1: But and then on the on the on the upside,
Speaker 1: our New York economy is doing well. We're driving the
Speaker 1: national economy in a positive way. And I want to
Speaker 1: say that we're the capital of finance because companies like HSBC,
Speaker 1: who are global giants, a couple centuries of global giants
Speaker 1: have chosen to make a commitment to New York, to
Speaker 1: move into a place like Hudson Yards, to invest here,
Speaker 1: and they're very committed here. So that's really important to
Speaker 1: keeping us a global financial capital, regardless of who's president.
Speaker 2: What's the talk in the partnership like Jamie Diamond going
Speaker 2: to Washington?
Speaker 3: Would you be would you be all cheering that on?
Speaker 3: Is there?
Speaker 2: Is there? Is there a discussion Aby domald Well.
Speaker 1: We certainly don't want him to leave before his new
Speaker 1: building opens on Park Avenar because that's a billion dollar, no,
Speaker 1: a multi billion dollar investment in New York City and
Speaker 1: we want to see JP Morgan safely ensconced in their
Speaker 1: new build. So but we could do worse as our
Speaker 1: next Treasury secretary.
Speaker 2: Thank you very much Kathy for joining me on Bloomberg today.
Speaker 3: Thank you for having me on