Related Group's Jorge Perez talks up Tampa Bay at Bloomberg News event
By Erik Bojnansky and Ashley Gurbal Kritzer
Tampa Bay Business Journal
Published: Dec 7, 2021

One of Tampa Bay’s most prolific developers touted the significant upside remaining in this market at a Bloomberg News event in Miami on Dec. 3.

Jorge Pérez, chairman and CEO of Miami-based The Related Group, said greater Miami’s rising rents are “not sustainable” and that he is starting to invest heavily in the Tampa metropolitan area.

Pérez expressed his views on markets, affordable housing and art at a panel discussion titled “The Future of Global Financial Centers: The New Miami,” hosted by Bloomberg News at the Pérez Art Museum Miami. A veteran real estate developer and an avid art collector — PAMM was renamed in his honor after he donated $40 million worth of artwork to the museum in 2011 — Pérez spoke on a panel that included Ark Investment Management founder Cathie Wood and FTX US Derivatives CEO Zach Dexter.

Wood has closed Ark’s Manhattan offices to move to St. Petersburg.

Pérez has told the Tampa Bay Business Journal many times in recent years that he sees potential in the Tampa Bay market; Tampa Bay is its second-biggest market outside of its hometown of Miami. Related is behind Ritz-Carlton’s debut in the Tampa area; it is the developer of the Ritz-branded residences on Bayshore Boulevard. It is also partnered with Tampa Housing Authority on the redevelopment of the West River, which includes affordable housing, and is the master developer of the Rome Yard.

Because of the wide range of its projects here, Related will be honored as the Business Journal’s Developer of the Year at its inaugural Best Real Estate Deals event on Dec. 13.

His son, Related President Jon Paul Pérez, recently compared Tampa’s growth to Miami in an interview with the Business Journal.

“Compare waterfront condos such as the Ritz to those in places like Miami Beach — it’s relatively cheap still,” Jon Paul Pérez said in September. “So I think it’s still a market that has not experienced the same run-up in prices as a market like Miami, but I think over time it will catch up to Miami.”

With regard to the Miami real estate market, Pérez acknowledged that “there is pent-up demand” and doesn’t see South Florida heading toward a crash that precipitated the recession of 2008.

“I think this is more solid growth than we had before,” he said. “It is not like before, where [buyers] put 10% down … and walked away from their contracts.”

But while Pérez said his company has taken steps to “protect ourselves from a crash like we had 10 years ago,” he did express unease about South Florida’s growing affordable crisis.

“Miami rents are $4 a square foot,” he said. “How are people paying for this? It is not like incomes are increasing.”

South Florida rents are increasing faster than other U.S. regions, according to a recent study released by Seattle-based residential brokerage Redfin. While rents rose an average of 13% nationwide to $1,858 a month, the average monthly rent in South Florida jumped 35.8% year over year to $2,891. That’s causing some working-class families to move out of South Florida entirely, particularly Miami-Dade County.

Pérez, though, remains bullish on Florida due to the general business friendly attitude of city leaders, unlike the unions and government officials of Chicago and New York, who are “killing us with their regulations.” He told an audience of investors, techies, press and art collectors that he’s very excited about Tampa-St. Petersburg. (According to Redfin, the Tampa metropolitan area’s rents average $2,059 a month.)

“We are huge on Tampa and St. Pete. We have 6,000 units planned for the next two years in the Tampa-St. Pete area,” Pérez said, adding that he is making a “huge bet” on that area because “it is a city where you can mold or have a large effect in molding.”

Wood said she moved her company’s headquarters from New York to St. Petersburg in October for the same reason. She said she wanted Ark Investment, which has $50 billion in assets, to be in a place where it can make an impact, and realized that “we are not going to make a difference in New York City.”

When she was enticed to look at St. Petersburg, Wood said the municipality “felt like Austin … 10 or 20 years ago.” And while she once vowed never to move to Florida, Wood said she was so struck by St. Petersburg’s “vibrancy, excitement, and friendliness” that she moved there.

Wood has already partnered with a local innovation center, is intent on investing in local startups, and wants to create an “innovation-focused curriculum spanning from toddlers to high schoolers” in the Tampa area.

But FTX’s Dexter said South Florida is still a great fit for his company. Compared to other major metropolitan areas, Miami is still very affordable and has “the right amount of regulation.”

And, “for young people, Miami is the place to go if you want to work in crypto,” he said.

Miami Mayor Francis Suarez, who spoke at the conference earlier about Miami being an innovative city, has been a huge advocate for tech companies moving into there, as well as cryptocurrency-related businesses.

But Tampa Bay is seeing its own explosion of new businesses in the cryptocurrency industry, many led by executives who have flocked here since the Covid-19 pandemic began.