👀 Office Ditch, Mansion Switch

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Happy Saturday Highest & Best! This week, we’re talking moving out, moving in — and tearing down. Here’s the playlist:

👋 Tech investment firm Andreessen Horowitz (quietly) leaves Miami

😮 Fort Lauderdale’s record home sale—and tear down

🔀 The Florida affluence shuffle

🏗 South Beach’s tallest penthouses

Also: Advertise with us! For inquiries, connect with me at [email protected].

Let’s get to it!

Major Venture Capital Firm…LEAVES…Miami

The door to Miami swings both ways. And venture capital firm Andreessen Horowitz took the exit.

The $43 billion California tech investor quietly vacated its Miami Beach office in May, just two years after opening it— a move that puts dimmers on the civic vision of Miami as an emerging tech hub.

In 2022, Andreessen signed a five-year lease for 8,300 square feet at 2340 Collins Ave, a prime Miami Beach office building owned by billionaire investor Barry Sternlicht.

👎 But the VC firm ditched its office space early because….employees weren’t using it, Bloomberg News reported this week.

🫠 It probably didn’t help that the crypto market crashed shortly after Andreessen moved in, just as Miami was marketing itself as the U.S. capital of virtual currencies. Andreessen manages $7.6 billion in crypto-related assets and employs a team of more than 100 to bankroll dozens of crypto startups, according to Bloomberg.

🤔 Still, as late as May 2023, Andreessen partner Chris Lyons posted a video tour of the firm’s Miami Beach office on Instagram. The shaky-camera reel offered views of empty workspaces, empty boardrooms…and sunshine vistas from floor-to ceiling windows. 🌞

“Three years ago when I moved to Miami it was crazy to think you could build a first-in-class technology business or VC firm outside of the Bay Area,” Lyons wrote in the Instagram post.

Was it?

Venture capital money flowing to Miami has been on the decline since 2022. Miami-area companies brought in $400 million in the second quarter of this year, compared with $5.8 billion for all of 2022, according to PitchBook.

🧐 Postscript: The former Andreessen Horowitz office is now occupied by a pretty, uh, clear-eyed tenant. Contact-lens maker Bausch + Lomb Corp. moved in this year.

⏪ Catch up on recent Highest & Best issues:

• We Gilt This City, August 30, 2024

• The Old College Try!, August 23, 2024

• It’s Raining Rentals!, August 9, 2024

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Behold! A $70 Million ‘Junker’ in Fort Lauderdale

This waterfront property in Fort Lauderdale just sold for $70 million — making it the most-expensive-ever home sale in the city.

The buyer plans to tear the house down. 😮

But let’s acknowledge the deal first, shall we? The 20,000-square-foot home sits on a 2.7 acre property, which belonged to hedge funder Donald Sussman, founder of Paloma Partners Management Co. in Greenwich, Connecticut.

Sussman bought the home, at 5 Harborage Isle, in 2016 for $27.5 million (a Fort Lauderdale price record back then). He spent about $6 million to renovate the six-bedroom, 11-bathroom mansion, before quietly listing it for sale, the Wall Street Journal reported.

The property — with a seven car garage, on an estate that includes a tennis court, a guest home and 1,035 feet of waterfront ⛵ — was marketed to potential buyers privately without a formal listing. There were reportedly three offers.

Tim Elmes, a mansion broker with Compass, represented the $70 million (still unnamed) buyer in this week’s blockbuster sale. The purchaser plans to demolish the main home and build a smaller one in its place, Elmes said in a press statement.

😎 The wherewithal to pay a record price for a home to demolish is kind of a status symbol, writes appraiser Jonathan Miller in his Housing Notes newsletter this week. (Perhaps it’s necessary in Broward County, where home listings at $10 million or more are in smaller supply than in Miami-Dade and Palm Beach Counties?)

“The owner apparently has the money to create what they want in this specific location and doesn’t appear to be concerned about their return on investment,” Miller writes.

U-Hauls Packed With Wealth

There's no crystal ball for real estate, but it’s hard to ignore the significance of Florida's in-migration of wealth.

🧐 Bottom line: households who moved into Southeast Florida in the post-pandemic period had higher incomes than those who moved out. And those who left were likely priced out.

💸 In 2022, newcomers to South Florida brought with them $10.1 billion in new taxable income -- more than double the figure for new arrivals in 2019, according to a report from the Miami Association of Realtors.

The Realtors’ report looked at tax data through 2022 (the latest available) and distilled some pretty interesting details on the financial status of those moving into — and out of —the region. Some highlights:

💰 Households that moved into Miami-Dade County in 2022 had an average adjusted gross income of $175,600. That’s 78% higher than the average income of those who left.

💰 Newcomers to Broward County had an average AGI of $115,500 in 2022. Those who left that year had average incomes of $85,400

💵 New households in Palm Beach County had an average AGI of $260,100, the highest in the region.

💸 Households that left Southeast Florida in 2022 decamped to other, less costly, parts of the state. Nearly 2,200 households moved to Lee County, which includes Fort Myers, on the Gulf Coast. Another 2,000 moved to Orange County, which includes Orlando.

💸 All told, Florida had the largest net inflow of income in the U.S. (again) in 2022 -- at $36 billion.

See the complete report, and its county-by-county analysis here.

Highest Condo View in Miami Beach, Starting at $19 Million

How much for the highest view you can get from a Miami Beach condo?

The answer was unveiled last week, when a pair of penthouses atop Miami Beach’s tallest residential tower, Five Park, hit the market.

“Canopy Penthouse 01,” a nearly 8,000-square-foot residence with south facing views, is priced at at $20 million. It features four bedrooms, six bathrooms, and, of course, a terrace.

“Canopy Penthouse 02” faces north and is seeking $19 million for that view— and a four bedroom apartment with over 7,700 square feet.

Under construction in South Beach, Five Park will stand at 550 feet and 48 stories. The penthouses are on the 47th floor.

That’s it for today!

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