Tom Hanlon, Director at specialist legal recruitment firm Buchanan Law discusses how his business set up shop in Miami.
It’s hard to believe that when Miami was first incorporated as a city in July 1896, it was home to just over 300 citizens. By the time we arrived in our splendid new Brickell office earlier this year, the Magic City’s population was pushing towards the 500,000 mark with numerous small business start-ups making their way and many of the largest US law firms expanding their local footprint.
The move was certainly a big step for Buchanan Law, a London-based specialist international legal recruitment firm. Launching our first US office – and our first outside the UK – we chose Miami over New York because of favourable corporate tax rates and an ability to attract a high level of talented people who were choosing Florida’s south coast to suit their lifestyle aspirations. Many of our law firm clients were already here and growing, or about to open. So, we wanted to catch the city at its pivotal growth point and share in the benefits of that growth.
One immediate benefit was the availability of prime commercial real estate at reasonable prices. We took a 37th floor office in a grade one building with a full sea view of the bay – roughly 40 per cent cheaper than the London or New York equivalent. But it’s also proved to be a fast-learning experience: in facing a range of challenges, we have learned how to overcome them, and in the process, develop a thriving business.
Initial challenges
That steep learning curve mostly arose from things that we simply didn’t know before we first arrived. Manifestly, there are many differences between operating in Miami and London – not least endless sunshine rather than predictable grey skies. Because it is both an international holiday centre and a mecca for large numbers of retirees, business can sometimes be a more secondary than primary consideration. It was a challenge we soon overcame.
But some other differences were more significant – attracting top talent, for example. It’s always a challenge to get the right people when entering any new market, but our strategic focus on hiring the best young Floridians from the state’s fantastic universities initially proved to be harder than anticipated. We persevered. Because Miami is such an attractive place to be – booming and on-trend – we’ve since been able to attract great talent, including two people who have moved from New York to join us here.
Any close examination of the maps will tell you that Florida’s footprint has more square miles than England. But frankly, we underestimated the impact of size and scale, such as the distance involved in potential candidates relocating from North Florida to Miami. Eventually, we managed to secure the talent that we wanted, not least because so many people of quality are choosing to move to Miami because of the lifestyle it offers.
We have, nevertheless, been surprised by quite how culturally different Miami is to the rest of Florida. At the outset, we thought there would be more similarities. As a growing hub with its own ecosystem and culture, it is gradually becoming more intense with a distinctly corporate feel, although definitely not as intense as New York. The working day, the working environment and the city’s culture are more relaxed. But as the legal market evolves with Big Law firms moving in, they add something of a New York edge to the mix, albeit a slightly more chilled version.
Our next struggle was public services, especially public transport, which appears to be some way behind larger international cities. For a business coming from London, this was something of a shock. In reality, almost everyone has to drive. Many people talk about Miami’s travel problems, with good reason: there’s a lot of congestion on the freeways. Commuting from further away has also been really difficult for some of those who joined us because they live outside the city. True, the Metrorail is amazing, but it’s also quite limited with just two lines comprised of 23 stations: great if you’re travelling from the airport or downtown to Brickell, but it does need further expansion.
The US’ tax system has been another challenge: inevitably bureaucratic, it’s also quite complicated in our experience with more hoops to jump through than our UK business in relation to income tax and corporation tax. We put a lot of effort into being tax compliant, making sure that we got everything right in relation to the withholding tax system for employees, for example – very different from the UK, and quite a tricky process to navigate.
Perhaps the biggest difference compared to London has been the speed of service. For example, the lack of deadline hitting by third-party contractors has led to some delivery times being significantly longer than expected. Short term, that made a big impact to which we adjusted quickly. We learned to recognise that it’s part of the cultural difference: many people choose Miami because of a lower intensity lifestyle. Some potential candidates also expect that to be the norm, which also surprised us.
The bottom line
Our move to Miami cost more than anticipated. For example, general startup costs were 20 to 30 per cent higher than forecast, although they have been balanced by favourable tax rates. Even eating out is 50 per cent above London prices! But critically, despite Miami’s ever-competitive business environment, the return on investment has been almost double what we projected. The commercial benefits of being here have been far greater than we thought they would, or could be. So yes, higher costs, teething troubles, cultural factors – and a lot to learn in a short space of time – but everything has worked out so much better in Miami than we ever believed was possible. That’s made all the effort worthwhile.
For any business thinking about following in our footsteps, we would definitely recommend Miami as a place to set up shop. But do your homework first to avoid any surprises!
