(Bloomberg) — Florida is luring its biggest name yet in hedge funds: Paul Singer’s Elliott Management Corp.
The $41 billion firm plans to move its headquarters to West Palm Beach from Midtown Manhattan, according to people familiar with the matter, joining a growing list of funds that have relocated to the Sunshine State.
With no individual income taxes, estate taxes or capital gains taxes, Florida has become a hot destination for hedge funds in recent years. The Covid-19 pandemic has accelerated that shift away from New York, the initial epicenter of the U.S. outbreak.
Singer’s co-chief investment officer and expected successor, Jon Pollock, owns a home near West Palm Beach and has been living there during the pandemic, said the people, who asked not to be identified because the information is private. The now-permanent move by Pollock, as well as several other senior employees, played a big role in the decision to shift the headquarters, said one of the people.
Elliott will keep its New York presence and also open an office in Greenwich, Connecticut. Billionaire Singer, 76, will stay in the Northeast. A spokesman for the firm declined to comment.
It’s unclear how many of the firm’s hundreds of employees will choose to move south, but Elliott will continue to employ hundreds of people in its Manhattan offices, said the person.
Elliott’s relocation will increase industry assets in Florida by more than half, according to data collected by research firm Preqin.While the number of hedge funds based in Florida has climbed rapidly in the past five years, most of them are small. New York still dwarfs all other locales, with about $1.3 trillion in hedge fund assets, according to Preqin.
Still, Elliott’s move, coupled with Carl Icahn’s recent relocation of his asset management firm to Florida, may lead to other big managers heading south.
Ken Griffin’s Citadel plans to open an office in Miami next year, according to a person with knowledge of his plans. Another Chicago-based firm, the $8 billion Balyasny Asset Management, will have its Miami facility ready before the end of the year, with capacity for about 30 staff.
Among other movers, Bluecrest Capital Management opened a Miami office in 2018, Verition Fund Management set up a location in Boca Raton two years ago and ExodusPoint Capital Management opened a small outpost in North Palm Beach last year.
Elliott plans to allow employees to choose where they work, whether partly at home or rotating through its offices, one of the people said. The firm employs 466 people, including 161 investment professionals, in New York and other U.S. offices as well as London, Tokyo and Hong Kong, according to its website.
The timing for the new locations hasn’t been decided, said the person. Staff across the firm won’t be asked to return to offices before July, they said. The plans are intended to accommodate staff who’ve left New York City amid the pandemic and are seen as a way to attract talent in the future, said the person.
While Florida has attracted high-earners for years — the Miami metropolitan area is home to one of America’s largest concentrations of Ferrari dealerships — much of the wealth is part-time.
Despite the efforts of real estate agents and business development organizations to turn Florida into a year-round finance hub, the state has struggled to peel away workers in the prime of their careers, who often see their Northeast networks as key to their professional success.
Among the industry’s earlier moves, David Tepper relocated Appaloosa Management to Miami Beach from New Jersey in 2016, though he personally moved back to the Garden State this year.
(Updates with other firms that have opened offices in 11th paragraph.)
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