It can’t happen here, can it?

Jesus, how stupid did they think we were?

Jesus, how stupid did they think we were?

Wall Street executives flee New York taxes for Florida. Why stick around a cold, grey unwelcoming city when you can play golf alongside fellow tax-haven seekers like Phil Mickleson and Tiger? Lose our financial industry base and Greenwich may once again become affordable for teachers and garbage men, but current home owners aren’t going to like it.

The city’s hedge-fund executives are flying south — and it’s not for vacation.

An increasing number of financial firms, especially private equity and hedge funds, are fed up with New York’s sky-high city and state tax rates and are relocating to the business-friendly climate in Florida’s Palm Beach County.

And they’re being welcomed with open arms — officials in Palm Beach recently opened an entire office dedicated to luring finance hot shots down south.

“Florida is a state of choice,” said Thalius Hecksher, global development chief for Apex Fund Services, who moved many of his operations to Palm Beach. “It’s organically grown. There’s no need to drag people down here. It’s a zero-income-tax jurisdiction.”

Also, commercial property values are much cheaper in Florida, and New York City will likely become even less friendly to businesses when Mayor Bloomberg leaves office next year, hedge-fund executives said.

“You weigh all of the benefits for being here to those in New York, and they outweigh them every time,” said Evan Rapoport, CEO of HedgeCo.net, which is expanding its presence in Palm Beach County.

The demand is so high that officials in Palm Beach County have set up an entire office to answer questions from city hedge-funders looking to relocate.

“We’re not doing a multimillion-dollar marketing campaign. We don’t need to,” said Kelly Smallridge, who heads the Palm Beach County Business Development Board, which set up the special unit to handle inquiries and marketing.

“They’re coming to us.”

Without warning, Smallridge said, her organization only recently started getting inundated with hedge-funders.

“The door was open because of the high-tax environment” in the New York area, Smallridge said.

“Smaller companies were moving completely out. Larger ones, looking for expansion opportunities, wanted to expand here,” she said while touting her group’s “free and confidential” consulting services.

The firms can easily pick up and move out of the New York region because technology allows them to do their work anywhere, she said.

That’s exactly what Hecksher — whose company services hedge funds around the world — did when he was looking to expand the firm’s US presence.

New Jersey-based Apex, he said, could easily have chosen Manhattan or Greenwich, Conn. — but instead, the company followed the industry to the tax-friendly Sunshine State.

21 Comments

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21 responses to “It can’t happen here, can it?

  1. Demmerkrat Patriot

    This will make it easier to corral them …..

  2. Floridian Summer Birds?

    Where they going for the summer?

  3. It’s just a matter of time until the Hedgies flee from this drowning Blue state. In fact, didn’t Eddie Lampert already leave? With one party rule and the Dem and union bosses running the state into the ground with their corrupt policies, you can count on it.

    Meanwhile, the Republicans will whine about Gay Marriage and Abortiion while the state is being bankrupted, gutted and filled up with illegal aliens and other mooches feeding off the ever dwindling rich.

    So much to look forward to!

  4. Balzac

    “President Obama nominated Mary Jo White, a former U.S. attorney, to chair the Securities and Exchange Commission (SEC) as a clear signal that he wants to hold Wall Street accountable for the financial crisis. Ms. White is most known for her prosecution of organized crime boss John Gotti and those responsible for the 1993 World Trade Center bombing.” (from UBS research).

    Obama long ago decided that the securities industry created the financial crisis. Sure, why wouldn’t the Wall St. millionaires wreck their own industry, their employers, their net worths and their livelihoods? The financial markets are very complex and require extensive industry knowledge. Instead, the all-knowing one nominates someone with expertise in prosecuting the mafia.

    Stalin, confronted with some human-rights troublemaker, just said: “We’ll, let’s just have the trial and then shoot the guy…..” This is Obama’s approach to financial regulation. Guilty before trial.

  5. Publius

    It is not just New York that is losing out to the Sunshine State but the entire Northeast and the 2010 Census confirms this. There has been a steady outflow of population from the Northeast to the Southeast and Southwest for some time. It is difficult for economists and elected officials to grasp the idea that taxes do matter and at the state level where you don’t have to renounce your citzenship to move (see Depardieu and Turner et al) people have done so. It most likely would have been worse save for the housing collapse and the weak economy over the past 4 years that prevented people from pulling up stakes and moving on

    Connecticut is a poster child for the Northeast. The population has been flat for 20+ years. We still do not have the same number of employed in the State as we did back in 1990-1991. The only thing that has grown is government. The state enacted an income tax back in 1991 under Greenwich resident Lowell Weicker, a prototypical New England Republican and the state has been in a death spiral ever since. The last tax increase in 2011 was based on the fact that the CT tax rate after being increased (6.7%) was still lower than New York (9%+), Rhode Island (12%) and New Jersey (9%), logic only a clueless technocrat can repeat with a straight face and even worse, believe.

    The link below is from a New York Times (a partisan believer in high taxes)article in 2011 discussing the tax increase. I am not sure you will laugh or weep, given what we know today. The bottom line is that people do vote with their feet and the trends of the past 2 decades will continue to the annoyance of those Northeast liberals who cannot understand why someone would move from a utopian state to a place with lots of warm weather, sunshine and liitle or no taxes.

    http://www.nytimes.com/2011/05/03/nyregion/tax-increases-stand-out-in-connecticut-budget-deal.html?_r=0

    • Anony

      We sold our place and left NYC six months ago for Texas.

      As much as we loved NYC and our home in Connecticut, we have been more than happy with our move to Texas. The current 14% tax for the privilege of living in NYC can stick it.

  6. AndyD

    Anybody ever see a list of top performing hedge funds with a Florida one in it? i didn’t think so

  7. Gwich Lurker

    The New Haven register has come out with a slamming editorial on the state’s ever upward expanding budget.

    http://nhregister.com/articles/2013/01/27/opinion/doc5104a8fa9a8c9478444233.txt?viewmode=fullstory

    As for FL, my company – as pseudo investment firm – continues to add to our FL office. The next tax increase maybe the one to push a real migration to Palm Beach. Some in the office already have homes down there and the irony – its all dems in the shop.

  8. Cant beat the weather and low cost

    78 degree and breezy in Hobe Sound.

  9. The New Normal

    Florida is great if you like hot weather (unbearable May to Oct) and dull or old people

    the culture (or lack thereof) is a huge negative, and for those with children the schools are pretty bad

    oh and if you thought hurricane Sandy was a pain, you will need to deal with one or two of those every year

    other than that it’s great and worth the tax savings

  10. Chimney

    It’s true that there is no state income or estate tax, but wait until these people see their property tax bills– there’s no such thing as a free lunch!

  11. Nice choice of photo. Grabs attention, the ultimate family man and the ultimate schnook. We are now learning about what is a “fair” tax rate and Phil actually apologized about working for the government through July and half way into August. And all of the “little” people are losing money they thought would be taken from those nasty rich people, not them. First they come for the billionaires. I’m not one, “what difference does it make?” Then they came for the multi-millionaires. Again, not me. So what, they deserve it. Then they came for the millionaires. Oops not me, but they’re getting close. Oh, my, oh my. They’re taking all of the money from all of us. Of course, the problem will be that once it’s all been taken, there will be none left to take….

  12. Anon58

    I’m sure some of these folks are the financial geniuses we have to thank for nearly sinking the whole world in 2008.

  13. Cos Cobber

    Anon58, yes and they are moving to be with the same morons who took 100% HELOC’s out to buy spec condos in Miami and vacaction in Mexico.