Miami has emerged as a hotbed for investment companies and private equity firms over the past decade. Several factors make Miami an attractive destination – its business-friendly tax policies, strategic location as a gateway to Latin America, and influx of high net worth individuals. Understanding the top players shaping Miami’s investment landscape provides insights into the city’s economic growth.
Major private equity firms choose Miami for regional HQ
Global private equity giants like Blackstone, Carlyle Group and Warburg Pincus have picked Miami to house their Latin American operations. Miami’s connectivity to major LATAM economies like Brazil, Mexico, Argentina and Colombia gives these firms local access to deal flows. The city’s competitive tax rates compared to other states have also drawn private equity shops. Blackstone, which has $95 billion in private equity assets under management, made waves when it announced plans to open a Miami office back in 2019. Other major firms that have followed suit include San Francisco-based TPG Capital and New York-based Insight Partners.
Family offices increasingly allocating to South Florida
Family offices manage the wealth of high net worth families, and Miami has seen more of them opening local outposts. The Miami Downtown Development Authority estimates that over 60 family offices have been established in Miami over the past 5 years. Latin American billionaires and entrepreneurs have been setting up family offices to manage their assets and investments. Miami provides proximity to home markets, as well access to US business services like wealth management, accounting, tax and legal advisory. Family offices also serve as localized investment platforms – they hunt for deals and co-invest alongside funds. Prominent family offices like those of the Mas, Beckman, and Capriles families from Venezuela and Brazil’s 3G Capital have headquarters in Miami.
Venture capital flows heat up Miami’s startup ecosystem
Miami is fast gaining traction as an emerging startup hub. Early-stage capital invested in Miami startups has catapulted over the past few years thanks to VC funds relocating. Notable funds that have planted roots include San Francisco’s Founders Fund, NYC-based Insight Partners and Chicago’s Pritzker Group. They are all active in writing Seed to Series A checks for Miami-based startups. Local VCs like Las Olas Capital, Krillion Ventures and Vine Ventures have also raised sizable funds to nurture this ecosystem. Founders are flocking to Miami too. According to Atomico’s 2022 State of European Tech report, Miami tied with Austin as the top North American city that European founders would move to launch a startup.
Real estate investment trusts expand Miami portfolios
Miami’s surging population and job growth has piqued the interest of real estate investment trusts (REITs). Data from Cushman & Wakefield shows nearly $10 billion pouring into South Florida real estate in 2021 from institutional investors. National REITs like Blackstone, Starwood Capital and Brookfield Asset Management have been aggressively buying commercial and residential assets. Local players like BTI Partners and Property Markets Group have also raised new funds to develop mixed-use projects. Industry experts forecast continued strong interest in Miami real estate from REITs and similar institutional investors.
Miami’s success at attracting private equity, family offices, VC funds and REITs highlight the city’s strengths – business-friendly climate, gateway location and influx of high net worth individuals. As more global investment capital flows into Miami, the city will likely solidify its position as the investment management hub of the Americas.