The number of Jewish residents in Thessaloniki played a role, but Hitler also had a bit of a grudge against Thessaloniki for its participation in the First World War. Greece at the time was split (literally - into two countries) between those who supported Britain (lead by the Prime Minister, Eleftherios Venizelos) and those who favoured neutrality (lead by the King, Constantine, who was Kaiser Wilhelm's cousin and a Field Marshall of the German Empire). Venizelos said that Britain would win because of her rule over the sea, and Greece, being a seafaring nation, was naturally gravitated towards Britain. The King, having been trained as a German officer, thought Germany's superior army would win the war. Venizelos resigned and formed a separate government based in Thessaloniki. Venizelos won the recognition of the Entente, which occupied Thessaloniki and Greece entered the war on the side of the Entente, opening a front known as the Macedonian (or Salonika) Front. This opened an additional third front for Germany and her allies. Hitler apparently did not forget this, and planned to incorporate Thessaloniki into the Third Reich as punishment. And punishment it got; the Nuremberg laws were implemented and the Jewish community was eradicated. Also keep in mind that Thessaloniki is strategically located for controlling Balkan access to the Mediterranean as the only way to move from the Balkan interior to the sea is through the Macedonian Plain, next to Thessaloniki.

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Yugoslavia was promised Thessaloniki in 1941 if it joined the Axis. It originally agreed, then there was a revolution, and the Nazis invaded it instead. Yugoslavia did not get Thessaloniki due to not joining the Axis.

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This is from: Panagiotopoulos, Apostolos (2009). Θεσσαλονίκη ... εν Θερμώ – Ο συγκλονιστικός 20ός αιώνας της πόλης [Thessaloniki ... on Fire – The City's Sensational 20th Century]. B. Maliaris Paideia. p. 753. ISBN 978-960-457-239-7. (The Yugoslavia reference is from p. 738)

Though I doubt this is the only reason, the Nazis racial aims for the Jews of Thessaloniki is likely to be part of the reason for occupying Thessaloniki. The Jewish communities of Greece had enormously high mortality rates, according to the United States Holocaust Memorial Museum the death rate among the Jews of Thessaloniki was around 94%. The deportations were carried out with overwhelming speed, overall the death rates for Greek Jews is given at 81%, one of the highest outside Eastern Europe. This is despite the fact that there was less cooperation with the Germans by non-Jewish Greeks than in places like Lithuania with comparable death tolls (90%). There was significant antisemitism in the area, but the Greeks held enormous animosity towards the Germans during the period of fighting, so the Germans could not be sure of their cooperation. Of course it is important to point out that it is unclear how much the Holocaust had been planned when Thessaloniki was occupied in Spring 1941. The mass shootings did not begin in force until a few weeks later with the invasion of the Soviet Union, and the first death camp, Chelmno, was not operative until December '41. While intentionalists would argue that the idea of exterminating all Jews in Europe predated 1941, there are arguments that the idea to kill the entire Jewish population of Greece was not fully formed when Greece was occupied. The main evidence for this is that the Jews of Thessaloniki were not ghettoized until 1942, and were not killed en masse until 1943. There is an argument to be made that other factors determined the decision to occupy Thessaloniki, and that the plan to kill Thessaloniki's Jews was only made sometime in 1942. I would argue that something between is more likely. I would say there is a strong argument to be made that the large Jewish community influenced the decision to occupy, and that some idea of oppression and possibly mass killing was preexisting, but that the actual plans were not made until 1942.

Most of Thessaloniki's Jews were killed over the spring and summer of 1943. Deportations began on March 15 and by summer over 46,000 of Thessaloniki's Jews had been deported to Auschwitz-Birkenau and killed. These few months made up at least half of the Greek-Jews killed during the Holocaust.

It is also noteworthy that at the time of occupation, both Italy and Bulgaria, though violently antisemitic in their own rights, were unwilling to let the Germans deport their Jewish populations. Though Bulgaria would deport Jews from Thrace in 1943 to Treblinka, they sometimes proved difficult for the Germans to control and only ever deported Jews from areas outside Bulgaria proper. Because of this there is a possibility the Germans wanted to maintain control of one of the largest Greek-Jewish communities rather than have to cooperate with the Bulgarians or the Italians in creating anti-Jewish policies/ actions. Ultimately in 1941, the Germans were likely to be skeptical of Bulgarian plans to annex Thessaloniki.

Thessaloniki was also symbolically important for maintaining control over the Greek-Jewish community because it was considered one of the centers of Sephardic Jewish life. It is important to note that Greek-Jews also had higher death rates in dual concentration/extermination camps like Auschwitz, due to language and cultural isolation. Those few Jews who were chosen for work rather than immediate death, they could not communicate with their fellow prisoners. Yiddish was the lingua franka in Auschwitz, with Russian, Polish, and German, being the next most common. Greek Jews spoke Greek and Ladino, and so couldn't communicate with capos, guards, or fellow prisoners. In accounts by survivors such as Tadusz Borowski, the Greek Jews are the bottom of the proverbial food chain, and died quickly. Greek Jews were also Sephardic, and so didn't have as strong cultural ties to their mostly Ashkenazi fellow prisoners as say a Polish and a Lithuanian Jew would have.

To wrap up with a final story of Greek Jews, it is thought that some Greek-Jewish prisoners in Birkenau assisted in the creation of the Sonderkommando photographs, the only photographic evidence we have from Jews inside the killing center. The photographer himself was likely a Greek-Jew known only as Alex, who risked his life to procure these images, and endured the torture that came with the job of a sonderkommando, who was forced to guide Jews to the gas chambers and then dispose of their bodies. Alex died during the subsequent Sonderkommando Revolt, after having assisted the resistance in destroying one of the crematoria.

(Most information comes from the USHMM, Didi-Huberman's "Images in Spite of All", and Borowski's "This Way to the Gas...")