The global financial industry is setting its sights on real estate south of Wall Street — way down south.
Bloomberg reports that firms as far-flung geographically as Germany (Deutsche Bank) and Australia (Macquarie) have been bringing jobs to Florida, with some local hiring, in stark contrast to downsizing within their operations elsewhere. The trend, said the newswire, is one known as “nearshoring” and ties into the desire to bring people and process away from New York, where “expensive” is the name of the game.
In Jacksonville, Fla., for example, there are 19,000 employees with firms such as Citigroup, JPMorgan Chase and Bank of America. In other, relatively cheaper areas of the country, such as Salt Lake City, Goldman is setting up shop. The nearshoring trend, according to Bloomberg, also has the added advantage of dovetailing with the Trump administration’s goals of keeping jobs in the United States. The jobs themselves across the aforementioned banks have extended beyond what might be termed back-office functions to include, more recently, client-facing trading positions.
The real estate picture is one that stands out in stark relief on a relative basis. Rent for higher-end office space located in Jacksonville is roughly $22 per square foot, 25 percent of similar rent per square foot in New York. Salaries paid in Florida for a financial analyst are a third cheaper than what is paid out to an analyst in New York. Beyond that, there’s no state income tax, and all of these costs savings can help add a bit to the corporate bottom line.