Miami: the Dubai of the Western Hemisphere

By Peter Yared – Guest Contributor

Peter Yared

Dubai reopened aggressively during the pandemic with extensive testing and vaccination programs. It has since outpaced its primary competitor, Singapore, as the key destination for the wealthy seeking sunshine, lifestyle, and lower taxes. Dubai now stands alone in the Eastern hemisphere as the nexus point for the wealthy of the Middle East, Asia, Russia, and many Europeans.

Similarly, Miami became a top destination for the wealthy through the pandemic and has now emerged as the Dubai of the Western hemisphere. Already considered the “capital of Latin America,” Miami has become the nexus point for the wealthy of the U.S., Canada, and Europe for the same reasons as Dubai: sunshine, lifestyle, and lower taxes.

Very much like Dubai, the culture of Miami encourages emigration, success, capitalism, and wealth. The city government, led by Mayor Francis Suarez, actively seeks to expand the city and attract new business.

The new people

For those who have not visited Miami since before the pandemic, it’s hard to comprehend how much has changed. Take Miami, as you knew it before, with many successful Latin American businesspeople. Add 50,000 successful entrepreneurs, executives, and personalities who moved to Miami from cities like New York, L.A., San Francisco, and Chicago. And another 50,000 are coming.

The social environment is similar to Dubai, with a mix of successful people from various industries who are in a new environment conducive to networking and integrating new people. Successful people who grew up in Miami and thought they had to be somewhere else are now coming home, topped off by the recent return of Jeff Bezos.

A lavish lifestyle

Dubai is a great place to be wealthy, and so is Miami. The weather is excellent eight months of the year and suitable for dining outside and yacht parties. A slew of high-end restaurants have opened in Miami, and there is a remarkable overlap of establishments between the Dubai International Financial Center (DIFC) and Miami’s Brickell, including Cipriani, Hutong, L’Atelier, LPM, and Zuma. Indeed, they are both attracting the same type of wealthy clientele that live or work in business areas of the respective cities.

The nonstop events include F1, Art Basel, Boat Show, Ultra, and Swim Week. Miami is one of the few U.S. cities with teams in the NBA, NFL, MLB, and MLS, with stars like Lionel Messi picking Miami as their go-to city.

Yes, people have a great time here, and Henley & Partners research shows that during peak season, Miami has the most wealthy residents of anywhere in the world.

An expanding metropolis

Like Dubai, the construction in Miami is nonstop, and new neighborhoods are seemingly created overnight. Dozens of new towers are planned or under construction in Miami’s commercial center Brickell, with a skyline increasingly looking like downtown Dubai. While other cities struggle to fill vacant commercial buildings, Citadel’s Ken Griffin is building a new $1 billion office tower in Brickell. Dozens of architecturally significant buildings are near completion from St. Regis, Edition, Shore Club, and Cipriani.

Brickell magazine’s January issue featured a cover story with a glimpse of what Miami could look like within the next decade.

Major neighborhoods such as Wynwood, Midtown, and the Design District have been fabricated in the last few years. Despite the construction, housing costs have doubled due to the influx of residents. Fortunately, there is much room to expand to lower housing costs. Just like Dubai is expanding into the desert and towards Sharjah and Abu Dhabi, Miami has become the capital of South Florida. It is becoming a metropolitan area, reaching across Palm Beach, Fort Lauderdale, Homestead, and the Florida Keys. Local governments are also planning for the future, focusing on adding workforce housing.

Miami as a finance center

South Florida has become “Wall Street South,” with $1 trillion of assets under management moving in the past few years. The list of firms that fully or partially moved to Miami and Palm Beach continues to grow, including Thoma Bravo, Apollo, Citadel, ESL, Elliott, Point72, Virtu, Founders Fund, and more. Traditionally a bastion for Latin American family offices, Miami is now attracting family offices from across the U.S.

Miami is increasingly building the infrastructure, services, and talent pool to be a full-fledged financial center. Policy shifts in Chicago are accelerating the departure of financial firms from the city, and New York firms increasingly consider South Florida to be a sixth borough.

Miami as a tech hub

Dubai is not a top tech hub, but has a lot of tech. Thanks to the efforts of investors like Keith Rabois, Jack Abraham, Shervin Pishevar, and Delian Asparov, Miami now has as many new tech company formations as established tech hubs like Austin, Boston, and Seattle. Miami has a hustle culture with twice the entrepreneurs per capita as any other city and an edge in real estate, hospitality, media, finance, gerontology, and other areas.

Some in San Francisco regularly like to bag on Miami but didn’t seem to notice that in the last ten years, New York City has emerged as an almost peer competitor with nearly two-thirds of the tech formations of the Bay Area. And there is a very tight relationship between New York City and Miami, with many executives living in Miami a minimum of -ahem- 183 days a year. It’s still uncertain what will happen in San Francisco with tech. There are indeed large A.I. companies that were formed years ago. Still, the past year’s Cambrian explosion of San Francisco A.I. startups keep getting nuked from orbit by the large incumbents that add A.I. features much faster than new startups can add distribution.

Attracting top talent

Dubai attracts two types of talent: already successful people from Europe and top talent from India and other developing countries. For young Americans starting in finance and tech, going to the hub city to network, learn, and make it can be necessary. Many people who are already successful and have built out a network of industry and financing connections come to Miami to start their second or third venture. Repeat entrepreneur Howard Lerman, for example, recently launched his new company, Roam, in Miami after taking his last company Yext public in New York City.

The talent density is not yet there in Miami. However, Miami has the opportunity to continue to import talent from the rest of the U.S. as well as attract the top talent from the 670 million population of Latin America either into Miami or as remote offices in hot spots like Medellin and Buenos Aires. People think that what made Silicon Valley happen was the roughly 3,000 combined yearly computer science graduates from Stanford and Berkeley. Walk through any larger Silicon Valley office, and it is clear that what made the place happen was attracting all the top talent from India, China, and Russia.

A travel nexus

Thanks to Emirates’ extensive route network, Dubai is where people always seem to come through and come to vacation. Similarly, Miami is the U.S. gateway to the Caribbean and South America and the U.S.’s largest cruise hub. Miami Beach is a top-rated beach and hosts numerous luxury hotels. For residents looking for a weekend getaway, there are over 30 countries within a direct 3-hour flight.

Unlike Dubai’s massive convention center, Miami does not have the biggest conference business. However, it hosts many finance-oriented conferences and smaller conferences for influential stakeholders, such as numerous conferences for wealthy family offices.

Unfortunately, through the pandemic, Miami Beach also became a destination for rowdy college kids and furloughed people with stimulus checks, leading to rampant crime and violence during Spring Break. This year, the city has clamped down significantly to prevent a recurrence.

The good weather (for two-thirds of the year)

Like Dubai, Miami offers good weather for around eight months a year. It gets hot and humid from June to September for four months, just like New York City becomes miserably cold for four months from November to February. A significant difference is that if you have kids in school and live in New York, there is no avoiding the winter. If you have kids and live in Miami, you can take off for the summer if you don’t like the weather.

Increasingly, people stay through the summer. I went on business trips to Dubai in June and August last year because people were in town and doing business. Many now stay in Singapore through the Southwest Monsoon rainy season in the summer. Similarly, Miami has many full-time residents who enjoy the beach life and A/C and wear shorts to business meetings. The muggy weather is not that dissimilar from Washington, D.C. where I lived for 14 years.

Hurricanes and climate

South Florida is, of course, susceptible to the hurricane season. Interestingly, in the past twenty years, New York City has been more damaged by hurricanes than Miami. New York City has many low-lying areas, lots of underground infrastructure, and building codes unsuitable for the type of storms that reach the city. California has also experienced large-scale flooding this year. 

I lived in San Francisco for 23 years. The Bay Area has an annual devastating fire season, and there is a lot of agreement about climate change, but there was no action on thinning trees or burying power lines.

In Miami, not everyone agrees about climate change, but everyone agrees that flooding is increasingly a problem. New pumping stations and seawalls are under construction throughout the area, and research is underway on how to mitigate seepage through the limestone into building foundations. Miami has very little underground infrastructure, staunch building codes since Hurricane Andrew, and heavy code enforcement  since the Surfside building collapse in 2021.

Snarled transportation and future-looking transport

Miami is one of the few places where rail infrastructure has been upgraded with high speed rail, which now operates through West Palm Beach to Orlando, and soon to Tampa. Metrorail is about to be upgraded between the Southern suburbs of Coconut Grove and Coral Gables to downtown. Things are getting done in a reasonable amount of time and at a reasonable cost, in stark contrast to transportation infrastructure in other cities.

However, local traffic is snarled during the rush hours. Miami was a city that hosted many part-time residents who suddenly became full-time residents. This shift inevitably led to increased traffic, especially on Miami Beach and its causeways to the mainland. Miami is now one of those metro areas where many people stick to their walkable/microbility neighborhoods such as Brickell or South of Fifth. Going to other parts of the area requires planning, much like San Francisco residents do not go to the Peninsula during the rush hour.

New technology presents an opportunity to rapidly add mass transit without building out expensive rail infrastructure. Miami-Dade has numerous highways with carpool and paid express lanes that could easily be adapted to self-driving vans and buses traveling at high speed. Like Dubai, there is active discussion in Miami about electric hydrofoils and drone transportation systems.

Miami’s anti-crime efforts

Miami is not crime-free, but the crime is not evenly distributed. There are good parts of town with vigorous enforcement of quality-of-life crimes and bad parts of town. It isn’t fair, and policymakers aim to recruit and support enough police officers to make the bad parts of town safer rather than make the good parts of town less safe. In Miami, I leave my gym bag in the car because the risk/reward is simply not there for a criminal to break into the car and see if there is something in the gym bag other than smelly clothes, versus the multiple exploratory break-ins I experienced while living in San Francisco.

In a lot of cities, crime has become uniform throughout the city, and there is a profound lack of enforcement due to a declining police force and a series of measures that prevent arrests and putting repeat offenders in prison. We can debate the merits of these measures, but in Miami, during public response sessions, citizens regularly bring up San Francisco and the proven negative externalities of policies.

An expanding educational system

One of the limiting factors for successful people moving to Miami is that the sudden influx has overwhelmed the existing K-12 private schools. Charter and private schools are expanding, but catching up with demand will take a while. New types of schools, such as Primer, which offers small private neighborhood schools, are rapidly expanding across the Miami market to compensate for the shortfall.

Florida’s university system continues to gain in rankings and stands to gain even more as premier universities elsewhere focus on producing graduates with an almost unemployable worldview and work ethic.

Is Miami really the Dubai of the Western Hemisphere?

Yes. To sum it up, business people would rather build a new office tower from scratch in Miami than move into an empty one in San Francisco. That is excitement. That is growth.

That is the new Miami.

Peter Yared is a serial tech entrepreneur who moved to Miami Beach 3.5 years ago after 23 years in San Francisco. He is the founder and CEO of InCountry, a global data management company.

Refresh Miami welcomes guest posts. Please e-mail your idea for a post to Nancy Dahlberg at [email protected].