Espaillat, who refused to concede immediately after Tuesday's election, called Rangel to congratulate him, according to a spokesman for his campaign.
"Today, I am announcing my re-election campaign for the New York Senate from where I will continue to work to find new ways to bring jobs, affordable housing and immigration reform to our community, so that middle and working class families can thrive here," Espaillat said in a statement.
"Even though I will not be representing the 13th District in Congress, I will continue to fight for opportunity for all."
More than 1,800 votes separated the challenger from the incumbent, who declared victory on Tuesday night at his campaign party after the precinct count gave him 47.4 percent of the vote compared to Espaillat's 43.6 percent. There are unlikely enough absentee or provisional ballots to swing the race to Espaillat, although the final count won't be certified until next Wednesday.
Rangel will run unopposed in the general election in November, and is assured re-election to the Harlem district he has represented for 22 terms. He said he plans to retire in two years, leaving Espaillat, 59, the presumptive front-runner should he wish to try again.
But Espaillat's opponent for his seat in Albany is already seeking to turn his ambitions against him.
"I think voters will know that he doesn't want to be our state senator," said former City Councilman Robert Jackson, who will face Espaillat in a September 9 primary. "His record has proven that. If you want to be a state senator, then you should be there taking care of the business of our district."
"If he doesn't want to be the next senator, I do," he continued. "If he wants to run for Congress, then let him run in two years and let him either win or lose based on the two-year fight for that seat."