Miami and Proptech: Why More Firms Are Considering the Magic City
It's still not in the same league as Austin, New York, the D.C. area or San Francisco — but things have changed
Let’s get this out of the way at the outset: Miami has great weather and Florida has no state income tax.
That’s the mantra you hear from many who live and work in the city and the state, but are those the only reasons why proptech has been growing in the Sunshine State’s best-known metro area?
The answers vary according to whom you ask in Miami’s proptech ecosystem, but there’s no doubt that the climate for real estate technology is increasingly warm and welcoming for those entrepreneurs from the U.S. and abroad who are building their businesses there.
For all its practical and glamorous attractiveness, though, is Miami in a position to crack the top tier of U.S. proptech cities such as Austin, the Bay Area-Santa Barbara corridor, Chicago, New York City, Seattle and Washington, D.C.?
“For us, Miami is a phenomenal location,” said Adam Mait, a Miami native and chief operating officer and co-founder at DoorLoop, a property management software company based in Miami Beach. “The weather cannot be beat. For tax purposes, specifically for income tax, it’s a wonderful area.
“And we have great talent here. Our universities are doing well. Talent has really picked up, and since the pandemic you have a lot of talent that moved into town. If you look at Miami prior to COVID, it was really a laggard behind New York, California and Seattle. Since 2020, we have seen a huge influx of capital, talent, real estate companies and venture capital firms migrating to Miami, which is propelling proptech forward.”
Mait also credits Miami Mayor Francis X. Suarez for attracting proptech and other technology and VC companies to move to the area. “It’s been a full-on press, both from a government perspective and from a finance perspective, that got people and companies down to the South Florida and Miami region,” said Mait.
On Miami’s venture capital side, Miami-based national homebuilder Lennar has established Lennar Ventures, the firm’s investment arm. In addition, Krillion Ventures and LAB Ventures are Miami-based VCs focused on proptech startup funding.
As a growing international business hub, particularly for Latin America and Europe, Miami has also been attracting proptech startups from beyond U.S. borders. One entrepreneur who has settled in Miami to build his proptech startup is Diego Kuri, founder and CEO of Kambio, a technology platform that helps consumers design, buy and build their own home.
A native of Mexico, Kuri came to Miami in 2015 as an early employee of WeWork to help establish that company’s footprint there. He was also attracted to a Florida lifestyle suited to the needs of his young family.
Subsequently, Kuri realized that Florida’s homebuilding focus made it the perfect place to found his business in 2021, he said.
“With our operation and our investors being half in the U.S. and half in Latin America, Miami is the capital for the region,” said Kuri. “You have access to the best of both worlds. And there’s still a good quality of life here. You breathe very pure air and you have the ocean. It gives me the energy that I need to pursue my goals.”
One proptech company that has crossed the Atlantic — or as the British sometimes call it, “The Pond” — to establish a U.S. headquarters in Miami is LandTech, a London-based software data firm that helps property developers identify, assess and buy land opportunities.
“For us in particular, it’s a very relevant place because you just need to be there to feel how hot the [real estate] market is,” said Jonny Britton, co-founder and CEO of LandTech. “There’s loads of development happening. Our product helps you assess lots of sites that are not obvious sometimes, because they look like there’s something already there. But, under the surface, the data tells you that it has the potential for more.”
Along with what Britton sees as a great product-market fit for LandTech, Miami’s diversity and lifestyle are major draws for his business.
“Miami has everything going on,” he said. “It’s a diverse and varied place. We always enjoyed spending time there, but it’s not just for second homes and retirement. It’s a place to live now.”
Having studied the Florida housing market, LandTech decided to plant its flag in Miami in part because of growing residential demand that has been constricted by over-zoning for single-family homes, potentially leaving room for development opportunities that will require higher building density, Britton said.
“On top of that, it’s a good place to do business,” he added. “We have lots of entrepreneurs and early adopters for software packages, people who want to take advantage of the new opportunities that the software can bring and give you lots of feedback. And the data is available, but not easily available. That’s exactly the problem we solve, because our platform enables us to access data to be mined, scraped and aggregated so that it’s all brought together in one place. So, it was a combination of factors that led us to choose Miami.”
Given all the obvious positives that Miami offers, is it enough to make the city the real deal as a U.S. and international proptech hub?
“It’s definitely a deal,” said Zach Aarons, co-founder and general partner at MetaProp, the Manhattan-based early-stage proptech venture capital firm. “I wouldn’t say Miami is famous for proptech in the way it’s famous for tourism or crypto, but there’s definitely a lot of proptech going on there and there’s a lot of real estate going on.”
The Miami and South Florida proptech scene has been bolstered by the growing presence of commercial real estate, most of it emigrating from New York City. It’s also benefited from amenity-laden luxury residential tower construction, as well as the opening of the Brightline high-speed rail system connecting Miami with Aventura, Boca Raton, Fort Lauderdale and West Palm Beach, Aarons said.
“Miami has always had these crazy amenities in the residential buildings and it’s been known for things like car elevators in the Porsche Design Tower,” he said. “And the new family residences are going to have a version of that on steroids. Miami has always been known for heavy amenitization.
“Another thing Miami is known for is cross-border transactions to Latin America. We have a company, Milo, that enables financing for crypto buyers, which is a big Miami thing, and also for a lot of South Americans and Central Americans who want to buy property in Miami. They may be wealthy, but don’t have money in a [U.S.] bank account or a credit history in the United States, so it’s hard for them to get a mortgage. Companies like that are taking proptech and applying it to relevant Miami things, which I think is very interesting.”
However, Miami is not yet identified with a particular area of real estate as other U.S. proptech hubs are, said Aarons. He pointed to locations such as New York City, which is a commercial real estate leader, Santa Barbara as a hub for construction and property management, and Seattle as a center for residential listings technology.
“I wouldn’t say Miami is known for anything within proptech, but it definitely has its own community,” said Aarons. “And not just Miami, because the whole corridor stretches all the way to Palm Beach. From an infrastructure, municipal point of view, the Brightline is really opening up this corridor for business in an exciting way. The fact that you can be on a train from Downtown Palm Beach to Downtown Miami in, like, 45 minutes or whatever is transformative.”
Philip Russo can be reached at firstname.lastname@example.org.