By Teresa King Kinney, CEO, Miami Association of Realtors
Tech and finance companies, ultra-high-net-worth individuals and top restaurateurs are moving to Miami because of the incredible institutional improvements the mega-region has undergone over the past two decades.
No longer is South Florida just a place for sun and beaches. Miami is now a 24/7 global city with diverse local talent. The top financial center in the Southeast, it’s home to a booming downtown, serves as an unparalleled gateway to Latin America, hosts a world-famous arts and cultural scene and sports the best business-friendly environment in the U.S.
In recent months, Goldman Sachs Group Inc., The Blackstone Group Inc. and Peter Thiel’s Founders Fund have announced plans to relocate their offices to Miami. Their relocations go beyond tax savings (though there is plenty of money to be saved in that respect, as Florida is one of just seven states that do not levy state income tax, and Miami is home to a pro-business structure). Miami has diversified its economy, significantly elevated its arts and cultural institutions, improved its educational offerings and upgraded its airports, highways and schools. Miami today is significantly different from the Miami of two decades ago.
Downtown Miami: One of the World’s Top Metropolises
The biggest changes are taking place in downtown Miami, to which many tech and finance companies are relocating. Miami’s has been the fastest-growing major U.S. downtown over the past two decades, according to research by The Brookings Institution. Its evolution into one of the great 24-hour metropolises in the world brings significant benefits to all parts of South Florida’s economy.
More people moving to downtown Miami means new local museums and cultural centers, grocery stores, restaurants and bars. Downtown Miami and Brickell are distinct neighborhoods, but both are part of the central business districts — and close to work and shopping areas. Brickell has the largest concentration of banks in the Southeast and is nicknamed “the Wall Street of the South.”
Miami Worldcenter, a $4 billion mixed-use development, includes apartments, retail space, condos, hotels and offices across 10 blocks. 830 Brickell and the 13-story Nikola Tesla Innovation Hub are two more significant developments. COVID-19, which made remote working commonplace, has helped accelerate downtown Miami’s growth as more companies have taken a fresh look at their locations.
Miami offers tremendous advantages to relocating companies, such as low taxes, a business-friendly climate and affordable real estate costs in comparison to other major cities. The population growth, the relocation of corporate companies, the increase in high-level jobs and the higher wages all point to the city’s continued growth for the long term.
South Florida Investing in Arts, Airports, Highways, Schools
Relocating companies and ultra-high-net-worth individuals want major cities with top cultural offerings, airports, highways, schools and more. They want their employees to have easy access to a top airport, they want recently improved highways and they want the best schools to send their children to. South Florida has significantly elevated each of those areas in recent years.
Many South Florida cities, such as Coral Gables and Doral, have Art in Public Places programs. Wynwood Walls is the nation’s first and only outdoor street art museum. Local museums such as the Norton Museum of Art in West Palm Beach have undergone massive renovations.
Miami Beach and Miami-Dade county also invested in an eye-opening $620 million makeover of the historic Miami Beach Convention Center. The world also knows Miami is home to Art Basel, the premier art show of the Americas, in December.
Downtown Miami now has the highest concentration of cultural institutions of any city in the Southeast. Within walking distance of each other and built within the last decade are the Phillip and Patricia Frost Museum of Science and the Perez Art Museum Miami.
As concerns airports, Miami International Airport offers nonstop daily flights to 137 cities around the globe, ranks as the third-busiest airport in the U.S. for international passengers and is the country’s No. 1-ranked international cargo handler. It also unveiled a new North terminal for passengers in 2014 after a $2.95 billion renovation project.
The airport is currently undergoing another $5 billion capital improvement program that will modernize and expand facilities, improve amenities and enhance the customer experience. The 15-year expansion plan (approved in 2019) also includes smaller-scale upgrades on the four other airports in the county.
South Florida’s highways are always being improved. Three major highways are undergoing an $802 million project that will better connect communities within Miami and redefine the skyline with a six-arch signature bridge.
As for the K-12 public school system, Miami is led by one of the nation’s top superintendents, Alberto M. Carvalho. During his tenure, the district has received state and national recognition for unprecedented increases in student achievement and graduation rates.
South Florida colleges and universities have proven to provide the top talent for local companies. No longer are college graduates leaving South Florida for jobs. Instead, they’re staying in Miami as higher-paying tech and finance jobs become available.
Miami Offers Low Taxes, Regulation
The absence of a personal state income tax encourages many developers, businesses and residents to relocate to South Florida. Federal tax changes are also encouraging more relocations to South Florida from more expensive real estate markets.
Federal tax reform, which was signed into law on Dec. 22, 2018, sets a deduction cap for income, sales and property taxes at $10,000. The new cap is leading more residents of states with high property values and high state income tax to purchase properties in states such as Florida, which has no state income tax and a pro-business tax structure.
Business dollars go a lot further in Florida, given the state’s tax advantages, tax exemptions and lack of personal income tax.
Long-Term Cost Savings in Miami
The global shift to remote work means that talent and entrepreneurship have no geographical boundaries, and companies see the opportunity for long-term cost savings in our low-tax environment.
Miami Mayor Francis Suarez has been integral in accelerating Miami’s recent tech growth. The media has actively covered the buzz created by Suarez with top tech executives such as Tesla CEO Elon Musk, Twitter CEO Jack Dorsey, former Google CEO Eric Schmidt and the chair of Palantir, Peter Thiel. Media attention has even included billboards in San Francisco urging Bay Area residents to move to Miami.
These discussions and recent relocations are showing Miami is becoming a startup destination and an attractive investment market for entrepreneurship opportunities.