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Influencers leading the charge in Miami’s tech boom


Written byJesse Scheckneron May 25, 2021Miami’s tech boom is real, and as cutting-edge companies flee Silicon Valley,New York and other areas to join start-ups and investors here that are turningthe “Magic City” into a prime innovation hub, some local influencers areleading the charge.And it’s likely none comes to mind sooner in that regard than Mayor FrancisSuarez, who has courted numerous tech and finance firms like Boston PrivateWealth & Trust, Goldman Sachs, Reef and Spotify, among others, to move here.David Martin, CEO of real estate firm Terra, nominated Mr. Suarez for thecategory “Bringing Tech to Miami: Those who are leaders in new tech areas inthe community,” as did several others.Not long after FTX Crypto Derivatives Exchange paid $135 million for thenaming rights to the Miami Heat’s arena, the company’s CEO, Sam Bankman-Fried,pointed to Mr. Suarez’s efforts and interest in cryptocurrency as acontributing factor in the deal.More companies are coming. To handle the influx of interest spurred by aflurry of activity from his office (and Twitter account) and friendships withhigh-profile industry leaders like Elon Musk, Jack Dorsey and Peter Theil, themayor hired Miami’s first chief technology.“Every bank, investor and institution is talking about our mayor and hismessaging,” Mr. Martin said. “Francis has provided great leadership and hasperformed a visionary role in how Miami can position itself in this reimaginedeconomy post-pandemic.”Mr. Suarez said he was honored to be recognized for his efforts but that hecould not have accomplished nearly as much on his own.“I have an entire team – an entire city – behind me that have workedtirelessly over the last decade to turn this moment into a movement,” he said.“It feels like we finally have all the right pieces in place to cement Miamias one of the premier cities of the century, and it’s a true privilege to seemy vision for the city I was born and raised in come to fruition.”Also deserving praise is Nico Berardi, founder and general partner at seedfund Animo Ventures, said Alberto Ibargüen, president and CEO of the John S.and James L. Knight Foundation.Animo Ventures, which has footprints in Miami, New York and San Francisco butalso operates elsewhere, takes a boutique approach to investing in small techand non-tech businesses that are just starting out.The firm has an “originals only” rule for the companies in which it investsbetween $500,000 and $2 million, and the 20 start-ups it lists on its websiteas being either seeded or pre-seeded are all different.One such company, Finalis, is described as “the world’s first virtualinvestment banker.” Another is Tinymile, “a robotics company building ultra-light robots that move at pedestrian speed on sidewalks to revolutionize firstand last-mile delivery services.” There’s Yay Lunch, a ready-to-eat lunch-delivery service for children that partners with schools and local, organicfood entrepreneurs. And then there’s Mathison, which uses artificialintelligence to help employers diversify their workforce.Mr. Berardi, born in Argentina and now living in here, relaunched Miami-basedangel investment group Accelerated Growth Partners in 2014. He was 25. Hedescribed Miami’s entrepreneur environment around that time as “an up-and-coming ecosystem” in need of guidance.Before that, he ran the nonprofit Techo, which serves as something of aHabitat for Humanities across Latin America. That role brought him to theUnited States to fundraise for the organization.“He did that wonderfully successfully for three years. Then hisentrepreneurial bent got the better of him,” Mr. Ibargüen said. “He ended upgoing to Harvard Business School and now funds tech entrepreneurshipthroughout the hemisphere and in the United States. It’ll be impossible not tohear about the guy in the coming decades as a key leader.”Asked who else has helped to raise Miami’s stock in the tech industry byimporting talent and business, Cervera Real Estate Managing Partner andPrincipal Alicia Cervera Lamadrid pointed to Philippe Houdard, CEO of co-working company Pipeline Workspaces.Mr. Houdard is also the co-founder of tech-driven financial transactioncompany Skybank and serves on the board of the Miami Downtown DevelopmentAuthority.“He’s a fabulous guy – young, eloquent and terrific,” Ms. Cervera Lamadridsaid. “He’s done a great job of presenting our city and the opportunities ithas to offer a lot of the tech companies that are coming, and he’s alsohelping to get funding for start-ups and incubators.”Pipeline, self-described as “a high-design shared office space fostering acommunity of entrepreneurs, start-ups, independent professionals and smallbusiness teams,” has Miami-Dade locations in Brickell, Doral and Coral Gables,as well as spots outside the county in Fort Lauderdale, Orlando, Tampa andPhiladelphia.Pipeline’s membership includes a who’s who of tech giants – Google, IBM,Microsoft, Kayak, Uber and Postmates among them – and, naturally, its flexoffice space model, which encourages collaboration among tenants, hasattracted smaller, burgeoning companies that could be the next big thing.“Miami has surprised many people by emerging as one of the world’s newest andmost dynamic tech hubs. But Miami is still young and always creatingsurprises, always reinventing itself, often as a result of new ideas andattitudes from all over the world converging here,” Mr. Houdard said. “Now thecity is attracting, keeping and developing some of our generation’s mostimaginative tech entrepreneurs, and through our work at the Miami DowntownDevelopment Authority and Pipeline Workspaces, I’m just glad to be part of theeffort to make it a city where bright minds can flourish.”Top 4 Reasons Why Tech Companies Are Moving To Miami, FloridaSan Francisco has long been the preferred city for tech companies. However,over time, the City of Brotherly Love has become increasingly saturated, whichhas taken a toll on its resources and livability. Increasing taxes, expensiverents, and lack of space are driving people away from the bay area, andcompanies are looking for newer destinations to establish operations.With a global pandemic making life difficult everywhere, Miami has become thetop choice for many tech companies, thanks to its tropical climate, diversepopulation, and lack of state income tax.With business tycoons like Elon Musk (owner of Tesla Motors), Reddit co-founder Alexis Ohanian, and Shervin Pishevar vocalizing their love for Miami,the lure of the Magic City is becoming harder to resist every day.Here are four reasons why Miami is emerging as the next tech hub:

Pathway to Latin American market


The Latin American customers of tech companies are not limited to the US. Theyare present in other nearby Latin American countries too. With Miami’sproximity to these neighboring countries, tech companies are better-positionedto gain insights into the community’s market demand.

Access to Europe and East coast markets


From a Miami-based office, tech companies can easily tap into the East Coastand European markets. The Miami international airport Miami makes it feasiblefor companies to capture new markets worldwide.

Young talent


Miami has an abundance of untapped local talent that can be groomed to becomepart of a workforce that drives future technological advancements. With theright direction and mentorship, tech companies can leverage this significanttalent pool in the coming years.

Lower overhead costs


Another substantial benefit that tech companies stand to gain from moving toMiami is a favorable taxation environment compared to San Francisco. Floridadoes not have a state income tax, which helps companies substantially reduceoverhead costs. Because tech companies can easily work out smaller spaces,they only need an internet connection and cloud services to get started.Working from an affordable, single-bedroom flat can save your business asignificant amount of money, making it economically viable.With tech giants and venture capitalists investing more and more money in thestate, we are now seeing the beginning of a new tech revolution in Florida.With new startups emerging every day and an increasing number of IT jobs,Miami is poised to become the latest tech hub in the coming years.

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If you are looking for a storage facility to help you move from San Franciscoto Miami, Xtra Storage Companies will be your one-stop solution. We havestorage facilities in Aventura, Kendall, Plantation, and Brickell locations.Our self-storage units are safe, affordable, and climate-controlled to keepyour belongings in the best possible condition. We have self-storage units ofall sizes to meet your requirements. You can reach out to us by filling ouronline contact form.Why Miami is the New Tech HavenRyan Rea spent eight years of his life on the West Coast, working in the techand marketing fields. But after he was laid off from his job in San Franciscoin 2017, the rural Pennsylvania native decided to move to Miami.“I literally came here with a laptop and a suitcase,” he said. “My friends andfamily all asked me if I was insane.”South Florida’s tech sector has been around for decades. A visible example isNetwork Access Point (NAP) of the Americas, a 750,000-square-foot buildingnear Miami’s downtown that was built in 2001 by local tech entrepreneur MannyMedina. NAP of the Americas serves as the internet exchange point between theUnited States and Latin America.Yet this region’s tech sector has long been overshadowed by tourism,hospitality and health care. According to the Miami-Dade Beacon Council, anonprofit that seeks to enhance economic development in Miami- Dade, therewere 15,240 tech jobs in this county in the year 2020. That same year, therewere 151,503 jobs in the hospitality and tourism industry, and 146,465 “lifesciences and health care” jobs.South Florida’s reputation as a tech center wasn’t too good either. In January2015, just two years prior to Rea’s relocation to Miami, WalletHub.com, apersonal finance website, rated South Florida dead last out of 100metropolitan areas for jobs in the fields of science, technology, engineeringand math (STEM).But Rea, a Park West resident whose LinkedIn résumé includes “AI chatbotmarketing,” said he saw Miami’s potential even then.“We have amazing weather … the cost of living here is less than the WestCoast. We have a great tax structure. We have business-friendly laws … We justneeded something to happen,” he said. “I wasn’t expecting COVID.”In recent years, prior to the pandemic, tech and venture capital companiesmigrated to South Florida from other parts of the nation for the reasonsstated by Rea. Billionaire investor Carl Icahn, who owns an estate in IndianCreek, declared his intent to move his office from New York City to SouthFlorida as early as 2019. Icahn Enterprises finally settled on relocating tothe penthouse of Milton Tower in Sunny Isles Beach in August 2020.However, more stringent COVID-19 shutdown regulations in states like New Yorkand California have propelled tech entrepreneurs, engineers and investors torelocate to South Florida in even greater numbers, thanks to their ability towork remotely.Then something else happened.On Dec. 4, 2020, Delian Asparouhov, a principal at $6 billion Founders Fund, aventure capital company that includes PayPal founder and investor Peter Thiel,mused on Twitter: “Ok guys hear me out, what if we move Silicon Valley toMiami?”That’s when Francis Suarez, mayor of the City of Miami, tweeted back: “How canI help?”Soon after, Suarez was communicating via Twitter and his online video series“Cafecito Talks” with other venture capitalists and techies from New York andNorthern California’s Silicon Valley who were interested in opening up officesin Miami. By Feb. 18, Suarez’s tweet was refashioned into two billboards inSan Francisco bearing his Twitter address and the phrase “Thinking aboutmoving to Miami? DM me.”But Suarez wasn’t just chatting with techies about turning Miami into a mintfor cryptocurrencies, talking to SpaceX founder Elon Musk on the possibilityof digging tunnels beneath downtown Miami or being a billboard mascot. SoledadCedro, Suarez’s spokesperson, said the mayor was promoting his city as a techhub, just as he has for the past 10 years.“It is not just about lower taxes, which is a very important thing, but alsoMiami has good quality of life and very low crime rates,” Cedro told theBiscayne Times.The tweets and conversations were followed up by some movement.SAY HELLO TO YOUR TECHIE NEIGHBORSOn Jan. 6, New York-based The Blackstone Group, a private equity firm with$545 billion in assets, secured 41,000 square feet of office space at 2MiamiCentral, located within the massive MiamiCentral complex in Miami’s ParkWest neighborhood. The company has vowed to create 200 tech jobs in Miamiwithin two years. In February, Founders Fund announced it was moving into2,073 square feet of office space in Brickell City Tower. At least two of thecompany’s principals, Keith Rabois and Thiel, bought multimillion-dollarmansions in Miami Beach back in December, less than two weeks afterAsparouhov’s interaction with Suarez on Twitter.But it’s not just people moving into Miami that has made the news. On Jan. 28,SoftBank Group COO Marcelo Claure, a Miami Beach resident who owns a stake inthe David Beckham-fronted Major League Soccer team Inter Miami CF, announcedon Suarez’s Cafecito Talks that his company would invest $100 million in techstartups located in South Florida. Headquartered in Tokyo, SoftBank, which has$100 billion in assets worldwide, has had an office in Brickell since 2019,owns Brightline and the MiamiCentral complex, and has a major stake in ReefTechnology, a Brickell company formerly known as ParkJockey that now turnsparking lots into mobile kitchens for take-out food.Michelle Abbs, managing director of Mana Tech and former director of WIN(Women Innovating Now) Lab in Wynwood, said the responses to Suarez’s tweetshave “changed the conversation.” Prior to December, Abbs said she was still“selling the case of why Miami.” But since Suarez’s tweets and Blackstone’sannouncement, she’s had conversations with 56 prospective tech tenants wishingto move into Mana Common, an assemblage of 50 commercial buildings and lots onor near Flagler Street in Miami’s central business district that developerMoishe Mana wants to turn into an art, fashion and technology hub.Assisting Mana on that quest is Plug and Play Tech Center, a startupaccelerator headquartered in Silicon Valley’s Sunnyvale that was one of theearly investors of Google and PayPal. Abbs said the company will be movinginto a Mana-owned office building at 21 SE 1st St. in the fall.“We barely need to go into the ‘why Miami’ anymore,” Abbs said.Philippe Houdard, co-founder of Pipeline Workspaces and co-chairman of MiamiDowntown Development Authority’s Enterprise Committee, said he started hearingthe “rumbling” of tech companies migrating to Miami’s downtown area late lastyear. But since Suarez’s tweets, Houdard said that rumble has grown into aroar.“These are real investors from the top [venture capital] companies that aremoving here,” Houdard gushed, adding that he’s been meeting with companyexecutives with up to 100 employees who are “scoping out” Miami as a possiblelocation.“Miami is crawling with people from California and New York,” he added.“They’re here right now.”But will the tech migration lead to an increase in better-paying jobs in acounty with a poverty rate of 15.7%? Or will it instead speed upgentrification and drive up the cost of housing?SILICON VALLEY EAST?There aren’t any figures yet on how many new tech companies or tech jobs havebeen created in 2021. However, the Beacon Council reports that tech jobsincreased by 45% between 2015 and 2020.Michael Finney, Beacon Council president and CEO, said many of the new techand venture capital companies are setting up shop in Coconut Grove, Brickell,the central business district and Wynwood.But those aren’t the only places within Miami-Dade where tech companies areheaded. SwapUp, a tech startup that designs and manufactures T-shirts andother items, moved from its previous warehouse in New Jersey to Miami Ironsidein the Upper East Side’s Palm Grove.“Doral has nice opportunities. North Miami has nice opportunities. … CoralGables is always a player [in the tech sector],” Finney said. “I would alsosay that Miami Gardens and even far south into Homestead there areopportunities for [tech companies to relocate].”Prior to COVID-19 and Suarez’s “How can I help you?” tweet, out-of-statecompanies worried they wouldn’t be able to recruit talent or raise capital inMiami, Finney told the Biscayne Times. But in the past couple of months, hesaid there’s been a rush from companies headquartered in New York, NorthernCalifornia and Boston seeking office leases in Miami-Dade.“What is happening is that this convergence is creating a critical mass,”Finney said.Maria Derchi Russo, executive director of Refresh Miami, a nonprofit techstartup group with 11,000 members, said in times past, companies located inMiami had a hard time raising money from funds based in San Francisco or NewYork.“We would be kind of laughed at and looked down upon,” Derchi Russo recalled.Venture capitalists thought that “nobody could be building something seriousin Miami. They figured we were out partying.”With venture capital companies like The Blackstone Group and Founders Fundopening offices in Miami, that attitude is changing.“You won’t be laughed out of the room now,” Derchi Russo said.She credits Suarez’s interactions with techies for achieving that criticalmass.“I think that, given the current political climate, he struck a chord withfolks who aren’t feeling as welcomed in other cities,” Russo said.Indeed, the San Francisco billboards were paid for by Shervin Pishevar, abillionaire tech startup investor and former board member of Uber who movedfrom San Francisco to Miami Beach in 2017 following allegations of sexualmisconduct. The head of an advocacy group for San Francisco tech companiespraised the billboards and Suarez’s Miami invite, and claimed that techcompanies were no longer being appreciated in Silicon Valley.“Our hope … is that [San Francisco officials] see what Mayor Suarez is doingand [realize] that tech companies and tech workers are a crucial part of therecovery and growth of our cities and our communities,” Jennifer Stojkovic,executive director of sf.citi, told the Miami Herald.Neither Stojkovic nor anyone else at sf.citi returned an email from theBiscayne Times by deadline.Stojkovic’s claim that San Francisco is not appreciating tech companiesconfused Leslie Dreyer, arts organizer for the Housing Rights Committee of SanFrancisco. She said the city has actually done plenty for tech companies,including giving them tax subsidies and allowing them to operate private buseson public bus routes to ferry their employees in and out of that municipality.Dreyer also acknowledged that some residents resented tech workers for drivingup housing prices. That resentment manifested in a 2020 referendum when SanFrancisco voters approved a 0.1 to 0.3% wealth tax on corporations with CEOswho are paid more than 100 times their average worker, according to TheGuardian.David Goldberg, general partner of Alpaca VC, said income taxes charged by NewYork state as well as New York City factored in his decision to move himselfand his business to Miami- Dade. Yet Goldberg said his decision to relocatewas primarily due to his desire to get away from a dense metropolitan arealike New York during a pandemic, as well as his belief that the city is in aslump.“I was driven by a desire for a lifestyle change. … and I was not bullish onNew York for the next one to two years,” he said. “So I thought, ‘Where can wego that has a good lifestyle and good people?’”In August, Goldberg, a graduate of the University of Miami, decided to rent ahouse in Miami Beach’s Normandy Isle area for a year. Since then, he hasdecided to stay and is planning on expanding his company’s office in Wynwood.“We’re looking to buy a house now that we determined that this is where wewant to be,” he said.

MIAMITECH MANIFESTO


Suarez’s invite was not even a month old when Miami-based tech entrepreneursand educators published the

MiamiTech Manifesto on Jan. 1. While it welcomed


the newcomers, the manifesto urged them to reach out and collaborate withlocals, insisting that Miami will “never be the new Silicon Valley [or]Silicon Beach.”“We are not a barren wasteland for startups,” it stated. “We rank high onstartup activity and, like most emerging markets, are building theinfrastructure necessary to increase the rate of scale.” Leigh-Ann Buchanan,president and executive director of Aire Ventures and former director ofVenture Café Miami, is one of the authors behind the manifesto. She said sheand her colleagues wrote it to ensure that the influx of venture capital andtech companies would be “a beneficial moment for everyone.”“Like anything that is new, there is always concern about what it’s like onthe other side,” Buchanan explained. “One of the things we put in themanifesto is that we are builders and that we build together … We are notperfect but we want to make sure that we are learning from ecosystems wherethe building has resulted in racial inequalities, disparities, lack ofaffordability, homelessness. All of these things already exist in the Miami,and they exist in some of the markets where these folks are coming from.”So far, newcomers are reaching out to Miami’s “OG” tech companies.“A lot of the folks who are coming in are eager to get plugged in to see howthey can add value and integrate,” Buchanan said.Cedro insists that Suarez has never wanted Miami to become a clone of SiliconValley or New York.“He wants Miami to be Miami. To have the good things we already have in Miami,but on top of that to have good-paying jobs. To have options for the peoplewho already live here [so] they don’t have to leave to find betteropportunities outside the city,” she said.Brian Breslin, director of The Launch Pad at the University of Miami, ishopeful that an enlarged tech sector will reverse South Florida’s brain drainof engineering students who are often recruited away from the state foremployment.“Florida International University alone produces more than 1,000 computerengineers a year, and 60 or 70% leave Miami,” said Breslin, who would like tosee 100,000 tech jobs in Miami-Dade by 2025. “The University of Miami hasabout 300 to 400 computer engineers graduate every year. Miami Dade College istraining computer engineers.”Plus, the tech boom will cause a “ripple effect” that will indirectly createadditional jobs, he declared.But Dreyer said Miami-Dade’s current affordable housing crisis will beexasperated as more tech entrepreneurs move in. She pointed out that highhousing costs is the primary reason that tech workers are moving out of SanFrancisco to other parts of California or the nation. The median rental pricefor a one-bedroom in San Francisco is around $3,000 a month. In comparison,the median monthly rate in Miami is $1,500. Expatriates from Silicon Valleymanaged to drive up the rents in Austin “a lot” when they started settlinginto that city, Dreyer added.Told that Miami-Dade has no regulations governing increases in rent, unlikeCalifornia, Dreyer replied: “You people needed to start fighting for rentcontrol a long time ago.”Cedro said the City of Miami is still examining affordable housing strategies.“Affordable housing is one of [the mayor’s] top priorities,” she said, lateradding that Suarez “doesn’t think that gentrification is directly linked totech companies.”She added that San Francisco’s housing scarcity is what has caused its housingaffordability crisis.“We are not at our peak in terms of building. That gives us the ability tokeep on building and getting the (housing) prices lower,” Cedro said.But just how appealing is South Florida for a tech worker, really?In January 2021, WalletHub.com ranked South Florida 72 out of 100 largemetropolitan areas. A huge improvement over being ranked dead last, but hardlya top spot. In its subcategories, WalletHub.com ranked South Florida at 56 outof 100 metropolitan areas in “professional opportunities,” at number 63 in“STEM friendliness” and at number 79 in “quality of life.”Jill Gonzalez, an analyst at WalletHub.com, explained that high housing costscompared to salaries are the reason why South Florida ranks low in quality oflife. The low score for STEM friendliness had to do with research anddevelopment amounting to just 1% of the metropolitan region’s gross nationalproduct. As for professional opportunities, Gonzalez explained that SouthFlorida’s post-college graduate unemployment rate was high (3.3%) while themedian salary for STEM workers ($66,000) was low.Rea, however, is confident that salaries for tech workers will increase astime goes on.“I would check that list again in 12-24 months,” he said.In fact, Rea said he is so inspired by Suarez’s actions that he’s now takingon a second unpaid gig as an unofficial ambassador of Miami.“For the past two months I’ve had 30 meetings with [tech] people who movedhere or are thinking of moving here,” he said.Miami Office Market Lures More Tech Firms During Covid-19As resi brokers in South Florida report an uptick in sales and rentals largelyfueled by homeowners fleeing dense markets like New York, office brokers saythey’re starting to see a similar trend play out among tech firms. (iStock)In late February — before Covid-19 became a pandemic — Spotify inked a leasefor 20,000 square feet to house its South Florida headquarters in Miami’sWynwood neighborhood.The music streaming service’s deal for all of the office space and largecourtyard at the mixed-use development Oasis at Wynwood on North Miami Avenuewas another sign of momentum for TAMI (technology, advertising, media andinformation) companies taking office space in South Florida.But then coronavirus hit, prompting nearly half of the American workforce toset up shop in their homes and leading Twitter and Facebook to announce work-from-home policies that could lead to a potential void in the office marketsin New York City and Silicon Valley.South Florida, however, could benefit from the pandemic.As residential brokers in the area report an uptick in sales and rentalslargely fueled by homeowners fleeing dense markets like New York, officebrokers say they’re starting to see a similar trend play out among tech firms.Brian Gale, Cushman & Wakefield’sCushman & Wakefield’s Brian Gale, who was part of the leasing team that closedthe deal with Spotify at 2335 North Miami Avenue, said he’s given five virtualpresentations to major tech brands to take large spaces at 830 Brickell — oneof South Florida’s largest office projects under construction.OKO Group and Cain International are building the 57-story tower, which thedevelopers say will be anchored by WeWork, with an expected delivery date of2022. The property will have 490,000 square feet of office space, and willmark the first major office building to rise in Miami’s urban core in the lastdecade.Facebook, Apple, Google, Uber and Chewy are among the many companies thatalready have a presence. Tech firms take up nearly 3 million square feet inSouth Florida. Broward has the largest share, with nearly 1.7 million squarefeet, compared to about 765,000 square feet in Miami-Dade and just under halfa million square feet in Palm Beach County, according to CoStar data providedby CBRE.As with most office landlords and leasing agents in other cities, SouthFlorida’s office brokers aren’t convinced that working from home will become along-term result of the pandemic. Companies that were looking to takeadvantage of the tax benefits, weather and more favorable housing costs arestill planning moves to Florida, according to local real estate players.Daniel de la Vega, One Commercial“Companies like Twitter put their foot in their mouth too early. I believethat it’s really hard for people long term to work from home,” said Daniel dela Vega, whose firm One Commercial is marketing Creative HQ, an office condoin downtown Miami.“Only the really wealthy ones would move in the past, the Barry Sternlichts ofthe world,” he added. “But now people our age want to get out of the majorcities and they want to come to Miami and Fort Lauderdale.”Ripe for the pickingCommercial brokers are negotiating a number of “blend and extends” where thelandlord offers some free rent or concessions in exchange for longer leases.And for new leases, prospective tenants with the budget to do so are moreconcerned with building measures and office floor plans that follow the latestpublic health guidelines.> “Unless a landlord has got a lot of capital saved, it’s an ideal time for> tenants to restructure leases. We’re going to see the markets change in> favor of tenants.”>> Keith Edelman, Colliers InternationalCarpe Real Estate Partners’ Erik Rutter, one of the developers behind theOasis at Wynwood, said larger spaces and the ability to be outside willprevail, he argued.“There will still be a demand for office space. The growth of Miami willcontinue, if not be propelled by, this pandemic,” Rutter said.While some brokers believe there will be hesitation about returning to a high-rise office building versus a suburban, low-rise corporate campus, Gale saidhe’s negotiating nearly 200,000 square feet of proposals at 830 Brickell.Those conversations include one with a major tech tenant that is “veryserious” about opening an office in Miami, he noted,“People now are looking at new buildings as having better air quality, givingtenants the ability to really plan out how they’re going to look post-Covid,”Gale said, adding that many “are concerned with mass transportation and beingon top of people” in New York City.Local entrepreneur Brian Breslin echoed that point.People who run their own tech startups or work remotely for larger companiesare increasingly relocating to South Florida, said Breslin, the founder ofRefresh Miami, a nonprofit that focuses on tech networking in the city. Hesaid he believes more companies will follow recent WFH policies put in placeby Twitter, Facebook and Shopify.“Most people don’t have it in their budgets to space out employees six feetapart,” Breslin noted. “It would be unwise for us to think this is a short-term thing. A lot more of the traditional tech companies are rethinking theirhiring processes.”Keith Edelman, Colliers InternationalKeith Edelman, executive managing director of Colliers International SouthFlorida, said most long-term deals are on hold as companies evaluate theiroffice setups, which could put pressure on rental rates.Edelman, who recently returned to his office, had been working remotely formore than two months, speaking with The Real Deal from his car. He said hebelieves work from home culture could take a toll on camaraderie andcollaboration among employees — giving office tenants an incentive to beproactive in their leasing negotiations.“Landlords are scared,” Edelman said. “Unless a landlord has got a lot ofcapital saved, it’s an ideal time for tenants to restructure leases. We’regoing to see the markets change in favor of tenants.”More pouring inThe wave of companies moving to South Florida isn’t limited to just tech,industry sources say.Investment firms, insurance companies, hedge funds and family offices havealso been making the move, driven by the lack of a state income tax.Sandy Rubinstein, DXagencySandy Rubinstein, CEO of New Jersey-based digital marketing and advertisingfirm DXagency, bought a two-story office building just north of Wynwood for$2.25 million during the pandemic.The Miami native plans to make the 2,678-square-foot property at 3634Northwest Second Avenue the new headquarters for her firm, which countsMastercard, Univision, NBC, Viacom and Green Valley Organics among itsclients.“A lot of our employees up here have asked if they could transfer,” Rubinsteintold TRD in April. “Miami is such a good market for talent so I also want totake advantage of that now.”Miami Office Market Lures More Tech Firms During Covid-19As resi brokers in South Florida report an uptick in sales and rentals largelyfueled by homeowners fleeing dense markets like New York, office brokers saythey’re starting to see a similar trend play out among tech firms. (iStock)In late February — before Covid-19 became a pandemic — Spotify inked a leasefor 20,000 square feet to house its South Florida headquarters in Miami’sWynwood neighborhood.The music streaming service’s deal for all of the office space and largecourtyard at the mixed-use development Oasis at Wynwood on North Miami Avenuewas another sign of momentum for TAMI (technology, advertising, media andinformation) companies taking office space in South Florida.But then coronavirus hit, prompting nearly half of the American workforce toset up shop in their homes and leading Twitter and Facebook to announce work-from-home policies that could lead to a potential void in the office marketsin New York City and Silicon Valley.South Florida, however, could benefit from the pandemic.As residential brokers in the area report an uptick in sales and rentalslargely fueled by homeowners fleeing dense markets like New York, officebrokers say they’re starting to see a similar trend play out among tech firms.Brian Gale, Cushman & Wakefield’sCushman & Wakefield’s Brian Gale, who was part of the leasing team that closedthe deal with Spotify at 2335 North Miami Avenue, said he’s given five virtualpresentations to major tech brands to take large spaces at 830 Brickell — oneof South Florida’s largest office projects under construction.OKO Group and Cain International are building the 57-story tower, which thedevelopers say will be anchored by WeWork, with an expected delivery date of2022. The property will have 490,000 square feet of office space, and willmark the first major office building to rise in Miami’s urban core in the lastdecade.Facebook, Apple, Google, Uber and Chewy are among the many companies thatalready have a presence. Tech firms take up nearly 3 million square feet inSouth Florida. Broward has the largest share, with nearly 1.7 million squarefeet, compared to about 765,000 square feet in Miami-Dade and just under halfa million square feet in Palm Beach County, according to CoStar data providedby CBRE.As with most office landlords and leasing agents in other cities, SouthFlorida’s office brokers aren’t convinced that working from home will become along-term result of the pandemic. Companies that were looking to takeadvantage of the tax benefits, weather and more favorable housing costs arestill planning moves to Florida, according to local real estate players.Daniel de la Vega, One Commercial“Companies like Twitter put their foot in their mouth too early. I believethat it’s really hard for people long term to work from home,” said Daniel dela Vega, whose firm One Commercial is marketing Creative HQ, an office condoin downtown Miami.“Only the really wealthy ones would move in the past, the Barry Sternlichts ofthe world,” he added. “But now people our age want to get out of the majorcities and they want to come to Miami and Fort Lauderdale.”Ripe for the pickingCommercial brokers are negotiating a number of “blend and extends” where thelandlord offers some free rent or concessions in exchange for longer leases.And for new leases, prospective tenants with the budget to do so are moreconcerned with building measures and office floor plans that follow the latestpublic health guidelines.> “Unless a landlord has got a lot of capital saved, it’s an ideal time for> tenants to restructure leases. We’re going to see the markets change in> favor of tenants.”>> Keith Edelman, Colliers InternationalCarpe Real Estate Partners’ Erik Rutter, one of the developers behind theOasis at Wynwood, said larger spaces and the ability to be outside willprevail, he argued.“There will still be a demand for office space. The growth of Miami willcontinue, if not be propelled by, this pandemic,” Rutter said.While some brokers believe there will be hesitation about returning to a high-rise office building versus a suburban, low-rise corporate campus, Gale saidhe’s negotiating nearly 200,000 square feet of proposals at 830 Brickell.Those conversations include one with a major tech tenant that is “veryserious” about opening an office in Miami, he noted,“People now are looking at new buildings as having better air quality, givingtenants the ability to really plan out how they’re going to look post-Covid,”Gale said, adding that many “are concerned with mass transportation and beingon top of people” in New York City.Local entrepreneur Brian Breslin echoed that point.People who run their own tech startups or work remotely for larger companiesare increasingly relocating to South Florida, said Breslin, the founder ofRefresh Miami, a nonprofit that focuses on tech networking in the city. Hesaid he believes more companies will follow recent WFH policies put in placeby Twitter, Facebook and Shopify.“Most people don’t have it in their budgets to space out employees six feetapart,” Breslin noted. “It would be unwise for us to think this is a short-term thing. A lot more of the traditional tech companies are rethinking theirhiring processes.”Keith Edelman, Colliers InternationalKeith Edelman, executive managing director of Colliers International SouthFlorida, said most long-term deals are on hold as companies evaluate theiroffice setups, which could put pressure on rental rates.Edelman, who recently returned to his office, had been working remotely formore than two months, speaking with The Real Deal from his car. He said hebelieves work from home culture could take a toll on camaraderie andcollaboration among employees — giving office tenants an incentive to beproactive in their leasing negotiations.“Landlords are scared,” Edelman said. “Unless a landlord has got a lot ofcapital saved, it’s an ideal time for tenants to restructure leases. We’regoing to see the markets change in favor of tenants.”More pouring inThe wave of companies moving to South Florida isn’t limited to just tech,industry sources say.Investment firms, insurance companies, hedge funds and family offices havealso been making the move, driven by the lack of a state income tax.Sandy Rubinstein, DXagencySandy Rubinstein, CEO of New Jersey-based digital marketing and advertisingfirm DXagency, bought a two-story office building just north of Wynwood for$2.25 million during the pandemic.The Miami native plans to make the 2,678-square-foot property at 3634Northwest Second Avenue the new headquarters for her firm, which countsMastercard, Univision, NBC, Viacom and Green Valley Organics among itsclients.“A lot of our employees up here have asked if they could transfer,” Rubinsteintold TRD in April. “Miami is such a good market for talent so I also want totake advantage of that now.”

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