Ken Griffin just set a new standard for Wall Street firms looking to make the move south.
Goldman Sachs Group Inc. and Point72 Asset Management set up shop in a Related Cos. building in West Palm Beach. Dan Sundheim’s D1 Capital Partners leased space from Related Group in Miami’s trendy Coconut Grove neighborhood. Private equity giant Apollo Global Management Inc. took over a temporary office from law firm Greenberg Traurig LLP before locking down a long-term deal across the Miami River at 701 Brickell Ave.
Griffin, 53, the billionaire founder of Citadel, one-upped them all, pledging to build a pristine office tower in Miami with developer Sterling Bay that will serve as the global headquarters of his hedge fund and market maker.
While the process will take several years, creating a structure from the ground up along the waterfront in Miami’s business district is a new level of commitment from the titans of Wall Street, which have flocked to South Florida as employees gravitate toward its warm weather and lack of state income tax. Citadel’s ambitions could accelerate the plans of other banks, private equity firms and hedge funds looking to bolster their presence in the region.
Meanwhile, Griffin has already moved to Miami with his family, raising the prospect of him spreading his $28.9 billion fortune around Florida, where he was born and raised, as he has for years in Chicago.
“The ramification of this lease will be felt across the whole Miami market,” said Erik Rutter, co-founder of New York-based development firm Carpe Real Estate Partners. “You’re going to see similar caliber tenants” coming to the area.
The South Florida office market has been gaining momentum over the past two years, as scores of business leaders and employees relocated from places like New York, Chicago and San Francisco. Office leasing has surged across Miami and West Palm Beach, pushing up rents. That’s also driven heightened demand for housing and schools in the region.
Griffin's company had been looking to lease between 200,000 and 300,000 square feet (18,580 to 27,870 square meters) in Miami, according to a person familiar with the matter who asked not to be identified citing private conversations.
Citadel said it expects a few hundred people to be based in Miami next year, with some at the company already working from temporary offices at the Southeast Financial Center. The firm employs more than 1,000 people in Chicago. The mayor’s office called the news of Citadel’s move “disappointing” and thanked them for their contributions to Chicago.
Miami Mayor Francis Suarez said Griffin is "already an invaluable stakeholder of our community," citing the $5 million he gave the city to help respond to disasters such as hurricanes. Citadel’s headquarters shift cements Miami as a hub for financial companies, according to developer Don Peebles.
“When Ken Griffin moves his firm down here, what it says is, Miami has emerged as a place that can be the financial capital of the country at some point," said Peebles, the founder of Peebles Corp. “I certainly think it will be one of them.”
Griffin has been expanding his personal real estate footprint in the area since 2020, amassing property on Star Island, a private residential neighborhood in Biscayne Bay near Miami Beach. He’s also spent $350 million assembling 20 acres of land in Palm Beach since 2012.
Agent Jill Hertzberg, who has worked with Griffin, said the business executive was among the “visionaries” who have snapped up property in the area. She declined to comment on any specific transactions she’s handled for Griffin.
“He’s helped elevate the market,” said Hertzberg, who is part of the Jills Zeder Group at Coldwell Banker.
Major developers have also sought to expand operations in Florida to capitalize on the boom. New York real-estate titan Related Cos. just unveiled plans to build its first-ever office project in Miami, one of the tallest skyscrapers in the region.
“We're getting a tremendous amount of interest from financial institutions as well as financial service firms, private equity,” said Stephen Ross, who founded Related Cos. “We’re negotiating letters of intent with several of those head firms now.”
Finance companies, including private equity firms, and tech companies are inquiring about expanding in the area, according to Alec Kirschner, a Miami-based senior managing director at Current Real Estate Advisors.
“I’m still getting calls weekly, because they just want to be down here, in the action,” Kirschner said. “These companies need to have an office here to be competitive with everybody else.”
As finance and technology companies migrate south, law firms will be soon to follow. King & Spalding opened its office in the city in February, and Kirkland & Ellis announced its plans to expand in the area in May.
“Every major law firm is now vying for space in the new construction buildings because they need to be there to support all their clients and businesses that are moving down to Miami in a big way,” Carpe’s Rutter said.
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