Miami has become a magnet for New York firms eager to lay the groundwork for their next big project, but the transition isn’t easy.

Unlike New York, where major office tenants typically plan years in advance, Miami’s market requires a different approach. Preleasing is rare, tenant requirements are smaller, and projects often need to be developed with less upfront tenant commitment — making financing a challenge, developers said at Bisnow’s Wynwood to Edgewater event last week.

“It's stressful as hell because most capital today, if you're talking about office, [lenders] want distress or fully leased, long-wall credit tenants,” Rob Lapidus, co-founder of L&L Holding Co., said onstage at Wynwood Plaza.

Lapidus' New York-based firm partnered with Oak Row Equities, Shorenstein Investment Advisors and Claure Group to develop Wynwood Plaza, a mixed-use development with 266K SF of office, 25K SF of retail and 509 apartments.

The developers learned that building in Miami came with its own set of challenges, especially when it came to preleasing office tenants, Oak Row Equities Managing Partner David Weitz said.

“It's very difficult to find enough preleasing in a large building like this, with tenants who are willing to commit five, six years in advance — what their real estate footprints are going to be like in the future,” Weitz said. “It's impossible.”

Miami’s office tenants commit much later in the process than their New York counterparts — sometimes just a year ahead of move-in, making preleasing a challenge, Cushman & Wakefield Vice Chair Brian Gale said.

This is a stark contrast to New York, where companies sign leases three to four years in advance.

“They have to be thinking that because their square footage is so large,” Gale said. “Here, that is not the case. To really get a building preleased, you have to build it on spec, which is obviously a challenge from a financing standpoint.”

Wynwood Plaza was only 16.3% preleased when it began construction in 2023, with its biggest commitment from one of its investors, Claure Group, which took 25K SF. Law firm Weitz & Luxenberg also leased 18K SF for its first Miami office, The Real Deal reported at the time.

Amazon signed Wynwood Plaza’s largest lease at 50K SF in January, pushing the building to 50% leased. Tenants are expected to move in this summer, but having the building available for walk-throughs has made a difference.

“The traction on the office side is just so much better than it was during its construction period,” Weitz said.

Even then, the size of the lease is miniscule compared to New York. Since October, Amazon has taken more than 600K SF of office space in Manhattan alone as it has called employees back to the office full time.

Overall, Manhattan has more than 450M SF of office space, while Miami has less than 40M SF. Companies signed leases for 24M SF of office space in Manhattan last year, while there was just 1.5M SF of new leasing in Miami, according to CBRE.

And while Wynwood Plaza is on the verge of opening up, L&L has tried and failed to move forward on other office projects in Miami because of a lack of capital, Lapidus said. However, despite these challenges, he emphasized that Miami’s demand for office buildings was evident.

But companies don't necessarily need more room. Instead, they want environments that draw employees back to the office, Gale said. Buildings that lack amenities, natural light or a strong street presence struggle to gain tenants.

That shift is driving tenants to newer buildings with outdoor space, amenities and design flexibility, but the development process requires forward thinking. Wynwood Plaza includes features Lapidus said were designed to evolve with future needs.

“That's why you build flexibility,” Lapidus said. “We have this big outdoor area that, if something goes out of favor in a few years, we still have the ability to transform that.”

For the developers coming from New York, that kind of foresight is second nature — and it helped shape aspects of the project.

“In New York, the development cycle is so much longer than a year,” Lapidus said. “You buy something in one market, design and approve it in another, and build it in a third. You have to think ahead.”