The “Upper East Side” cocktail at Sant Ambroeus is just the same as in Manhattan, the carpaccio at Cipriani as meaty red as on Wall Street.
Here is the private-equity billionaire Stephen Schwarzman, on his way to La Goulue, the clubby French bistro popular with Park Avenue socialites. There is David Solomon, the Goldman Sachs chief, a team of financiers in tow.
The names and the money say New York, but the aquamarine pools, the swaying palms, and the sultry Atlantic breezes say something else: Florida, the would-be Wall Street South.
For months now, A-listers and lesser-lights from the world of high finance have been traveling to the Sunshine State while riding out COVID-19. Hopeful locals see evidence that the area’s long-elusive dream of luring Big Finance for good might be coming true at last. Along Worth Avenue in Palm Beach, real estate agents count commissions from a pandemic-induced real estate boom. Private schools fantasize about attracting the Spence set.
The reality is more nuanced — much more.
Only a small percentage of Manhattanites moved permanently to Florida last year. And as vaccinations stir fresh hope that the pandemic’s end is near, ebullient talk of South Florida drawing Wall Streeters en masse is already beginning to fizzle.
Dan Sundheim, founder of New York-based hedge fund D1 Capital Partners, will very likely leave Palm Beach and return to his Park Avenue home, according to a person familiar with his plans. David Tepper, who moved back to New Jersey from Miami last year, is staying in his home state for now, even though he and wife just bought a $73 million Palm Beach mansion.
“The main problem with moving to Florida is that you have to live in Florida,” said Jason Mudrick, who oversees $3 billion at Mudrick Capital Management and has resided in Manhattan for more than two decades.
“New York has the smartest, most driven people, the best culture, the best restaurants and the best theaters,” he said. “Anyone moving to Florida to save a little money loses out on all of that.”
By late last year, one might have been excused for thinking that Manhattan would soon be bereft of dealmakers, money managers, and traders. Elliott Management Corp., Citadel, and Point72 Asset Management had all announced plans to open offices in Florida, and Goldman was weighing whether to move some asset-management jobs there.
Doug Cifu, head of market-maker Virtu Financial Inc., said he couldn’t wait for the 6-minute commute in his Corvette when he moves to new offices in Palm Beach Gardens from New Jersey. Scott Shleifer, a top executive at Tiger Global Management, just bought a $132 million house in Palm Beach and plans to establish residency there.
Much of the narrative around these relocations centered on taxes and business-friendly climate. Florida has no state income tax, while New York City’s is among the nation’s highest.
Yet US Postal Service data paints a different picture: Last year, 2,246 people filed a permanent address change from Manhattan to Miami-Dade County and 1,741 went to Palm Beach County. Together they account for 9 percent of the out-of-state moves from the borough, up from 6 percent in 2019.
Still, even a small number of departures by the ultra-wealthy can have an outsize impact. The top 1 percent of New Yorkers paid $4.9 billion in local income taxes in 2018, comprising 42.5 percent of the total collected, according to the city’s Independent Budget Office.
More Manhattanites relocated to Jersey City, N.J., Los Angeles, Philadelphia, Chicago, and Hoboken, N.J., than they did to either Miami or Palm Beach. Except for Philadelphia, the other destinations are in some of the highest-taxed states.