Billionaire real estate investor Barry Sternlicht said the reset underway in U.S. office and multifamily markets is creating fresh deal opportunities nationwide as the flight of wealth and businesses from high‑tax states to South Florida reshapes capital flows.
South Florida has scored hundreds of corporate relocations and expansions since the pandemic, leading to an influx of entrepreneurs, corporate decision makers and the funds that can fuel prosperity. High-profile technology firms as well as financial giants like Citadel Securities and Thoma Bravo have expanded or relocated to the Miami area in recent years.
Sternlicht, CEO and chairman of Starwood Capital Group, has had a front-row seat to the region’s growth since moving the firm’s headquarters to Miami Beach from Greenwich, Connecticut, in 2018 and setting up a permanent location in a new office at 2340 Collins Ave. three years later. He considers Miami a durable growth market rather than a pandemic-era anomaly.
While he has done business worldwide since founding his alternative investment management firm in 1991, he said he "really" appreciates how businesses in Miami are encouraged to succeed from both local officials and residents alike. He spoke during a media tour this week of the Perigon, a luxury condominium project that Starwood Capital is developing alongside locally based Mast Capital, in Miami Beach, about six miles northeast of downtown Miami.
Even so, Sternlicht and his firm are struggling with pressures from high interest rates as well as rising labor and construction costs squeezing margins across commercial real estate. In 2024, Starwood forfeited three Bay Area office towers to Deutsche Bank and Starwood with joint venture partner Artisan Ventures surrendered the 1.6-million-square-foot Pacific Corporate Towers to lenders, according to media reports. More recently, a 22‑hotel Starwood hotel portfolio spanning 17 cities and backing a $265 million loan moving into special servicing this past January.
The Perigon is one of several real estate irons Sternlicht has in the fire in Florida. Starwood Capital is working with Fontainebleau Development on a luxury condo project in Jupiter Island along Florida's Treasure Coast. Sternlicht is also chairman of Starwood Hotels, which is focused on selective growth of the company’s three brands: 1 Hotels, Treehouse Hotels and Baccarat Hotels. Starwood Hotels recently announced plans to build a hotel under its Treehouse brand in Miami Beach.
Throughout the tour, Sternlicht discussed potential deals in the office and multifamily markets, the ongoing wealth flight from high-tax states and the Miami-area’s growing infrastructure needs. Below are his thoughts on various trends shaping commercial real estate in South Florida and across the nation:
What the wealthy are up to: Floridians are “astonished” when it comes to just how high taxes are in other parts of the country, Sternlicht said, adding that in "blue states" it's just “tax after tax after tax,” referring to California and the Northeast. California’s proposed wealth tax “really pissed off” the state’s wealthy residents, and it has been a contributing factor to why the CEOs of major tech giants like Facebook’s Mark Zuckerberg and Google’s Larry Page have personally made the move to Miami, snapping up multimillion-dollar residences throughout the city.
Where the deals are: Office and multifamily, Sternlicht said. While office property prices have started to rebound following their pandemic-era collapse, Sternlicht noted that for multifamily, there's been a load of new supply that's hit the market over the past few years. That means owners and developers are upping their concessions to potential residents, aiming to hit occupancy rates even as many of them are “having discussions” over potential refinancings with “banks all over the country,” he said. Some markets like New York remain “shockingly strong,” said Sternlicht, with the city “holding its prices" across all assets.
South Florida's infrastructure needs: Schools and marinas are key issues facing Miami and the wider region, Sternlicht said. Companies whose employees have moved down to Miami are facing limited options, and that has led to years-long waitlists for schools that often fail to receive the same attention as affordable housing. "I think if we could just get the schools built, we could have a lot more systematic growth," Sternlicht said. And when it comes to recreation, South Florida — a region that's built part of its economy and fame for its waterfront location — needs more marinas for the "everyday boater," Sternlicht said.