In a frank and forthright discussion, a prominent investor Kevin O’Leary has voiced significant concerns over the business environment in New York, labeling it a “loser state” alongside California due to policies he perceives as hostile to business interests. O’Leary, speaking from his experience and reflecting broader sentiments within the investment community, highlighted the impact of high taxes and stringent regulations on investment decisions post-pandemic.
The conversation, which initially touched on the controversial awarding of a business accolade that has shocked many, including those indifferent to Donald Trump, quickly pivoted to a broader critique of New York’s business climate. O’Leary expressed bafflement at the decision, suggesting it lacked any rational basis, and used this as a springboard to discuss his and others’ reluctance to invest in the state.
Drawing from his direct experience in real estate development, particularly in the burgeoning sector of high-end data centers, O’Leary outlined the critical factors driving investment decisions to states deemed more business-friendly. “The hottest asset class is very high end data centers,” he stated, emphasizing their significant capital requirements, ranging from $2.5 to $3.5 billion each, and the necessity of a supportive regulatory and fiscal environment.
Despite New York’s natural advantages, such as the potential for low-cost power from Niagara Falls, O’Leary unequivocally ruled out the state as a viable location for future projects. Instead, he pointed to Oklahoma, North Dakota, and West Virginia as preferred destinations, where meetings with Governors Kevin Stitt, Doug Burgum, and Jim Justice, respectively, have underscored their states’ openness to investment.
This stark preference for what he termed “winner states” over “loser states” like New York is attributed to their more favorable policies, competitive taxes, and the absence of what he sees as business-repellent decisions. O’Leary’s narrative suggests a bleak outlook for New York’s ability to attract and retain new investments, particularly in high-value sectors such as data center development, which promises substantial job creation and economic activity.
O’Leary’s critique extends beyond the immediate implications for New York, posing fundamental questions about the state’s future economic direction and its ability to compete for new money and businesses. With states like Tennessee and its capital, Nashville, cited as examples of dynamic growth and investment attraction, the commentary serves as a cautionary tale for New York and similar states to reconsider their regulatory and fiscal frameworks.
As New York grapples with the fallout from the pandemic and seeks to reestablish itself as a premier destination for business and investment, O’Leary’s stark assessment underscores the urgency of policy reforms aimed at improving the state’s business climate. The call to action is clear: for New York to shed its “loser state” status, it must undertake significant work to become more competitive and attractive to investors seeking fertile ground for their next billion-dollar projects.