Stakes are rising as Jon Paul Pérez takes the reins at Related
Related Group’s newly minted president is tasked with leading the development firm during a pandemic and oversaturated condo market
It took about three months for Jon Paul Pérez to persuade his father to invest in the luxury apartment tower Wynwood 25 back in 2017.
The eldest son of Related Group founder and Miami “condo king” Jorge Pérez said last year that he negotiated the partnership with developer East End Capital “from soup to nuts.”
East End was looking for a strong partner with construction expertise, and it found that in Related.
Wynwood 25’s nearly 290 rental units and retail space were completed last year, marking the first major apartment project to be completed since the trendy neighborhood was rezoned about five years ago.
Jon Paul, who recently turned 36, has led Related’s charge in Wynwood, as well as its push into newer technology and amenities.
Last month, he became the company’s president, formalizing a succession plan that has been in the works for more than a decade. Jorge, the firm’s 71-year-old billionaire chair and CEO, has been stepping back over the years to focus more on his art collection and philanthropy.
Now, Jon Paul — who will remain surrounded by a group of longtime advisers — must step up to the plate during the pandemic, which has devastated local hotel, retail and restaurant owners while pointing up a greater need for affordable housing.
In short videos to his firm’s employees that began in March, he has reassured them that they will get through the months ahead, even reminding them to avoid using the office microwave and encouraging them to bring hot food in a thermos.
And as long as he can prove that Related is safe in his hands, Jon Paul stands to inherit one of South Florida’s largest and most influential development firms, one that Related Companies founder Stephen Ross has had a stake in since the start.
The development firm, which is rumored to have built one in four Miami condos, now has about 12,000 rental and condo units planned for next year. That includes at least half a dozen projects in a neighborhood that has seen property values explode in recent years.
On the condo front, Related is often the first to launch sales, the first to offer incentives when the market is saturated and the first to cancel a project when sales are lackluster. The company was also hit hard during the last recession, after many buyers walked away from their deposits.
Jorge has spoken about the importance of making “very cold” decisions about specific projects, and Jon Paul takes a similar approach, relying heavily on his financial background.
But while Jon Paul is expected to eventually take over entirely, it’s clear that his father still calls the shots for now, as he continues to run some company meetings. At the same time, all major investments must be approved by the Pérez family.
Matt Allen, Related’s executive vice president and COO, said late last year that the day Jorge is not at the company “is the day we put him in his grave.”
Like father, like son?
Jon Paul, also known as J.P., could be described as quieter than his dad, an outspoken art collector who has not shied away from rebuking President Donald Trump and his policies.
Jorge’s eldest son is just as exacting of people, though less aggressive than his father, according to those who know him well.
“He’s quiet and pensive, and when he speaks he has something intelligent to say,” said developer Gil Dezer, who partnered with Jon Paul on the high-end Residences by Armani Casa in Sunny Isles Beach. “He doesn’t go out and give opinions to people he doesn’t necessarily know, which is smart.”
Dezer also said that Related runs like a “great machine” and would be successful regardless, adding that Jon Paul will lead the company “very well.”
Related — which Jorge founded in 1979 with Ross — has been active in developing luxury condos, affordable and market-rate housing, mixed-use projects and office buildings. The firm has also expanded throughout Florida, doubling down on Tampa, as well as the Southwestern U.S., and has projects in Latin America, where Jorge was born.
And Related isn’t showing signs of slowing down. Construction has continued on its existing projects, and this fall Related launched sales at Solemar, a luxury condo tower planned for Pompano Beach. This month, the company also closed with Dezer Development on a site in Hillsboro Beach where the two firms plan to build luxury condos.
Succession is likely one of the most important decisions a founder makes, said Ezra Katz, founder and CEO of Aztec Group, an investment and merchant banking firm based in Miami’s Coconut Grove. The earlier a plan is set into motion, the better, and to “think you’re invincible and immortal is not an option,” he noted.
“It’s a touchy subject. It’s not a good idea to demand it. It has to be a natural process,” Katz said. “I can cite many situations where the children of the family members didn’t want to be part of the family business.”
Though Jon Paul differs from his father in some ways, he isn’t less direct, decisive or demanding than Jorge, said Related Vice Chair Adolfo Henriques. He’s been described as a “firecracker,” and he and his father are both Type-A personalities, said Henriques, adding that Jon Paul is open to other opinions but has his own and is far from soft-spoken.
Both Jon Paul and his father declined to be interviewed for this story, due to timing.
Jon Paul’s work life and home life started on the same page. He and his younger brother Nicholas, now a vice president at Related, would often visit sales centers and properties on weekends with their dad.
“Both Jon Paul and Nick have been intimately involved in [the business] their entire lives,” Henriques said. “It’s just kind of intrinsic. It’s built into how they think.”
Jon Paul got his start in 2008, working for Related Companies President Bruce Beal just before the financial crisis hit. After graduating from the University of Miami, he left his hometown to work for Related Companies in Manhattan. Getting outside experience was a requirement if he were to come back and work for Related Group.
“I was Jorge’s son but I was not treated like that in New York,” Jon Paul told The Real Deal in a 2014 interview. “That was the best thing for me.” As Jon Paul takes more control over the company, especially during a pandemic, the people he surrounds himself with will be crucial to his success, according to observers on the outside.
“It’s going to be critical for Jon Paul not to let the real estate industry blow smoke up his ass because if he buys into that, it will be a disaster,” said condo market consultant Peter Zalewski, who has consulted for Jon Paul.
“He needs the Matt Allens of the world and others who are going to give him straight talk and not fall for the real estate hyperbole and bullshit the industry is renowned for in Miami,” Zalewski added. (Allen has worked for the firm since 1999.)
Jon Paul is part of a younger breed of real estate developers, many of whom he’s partnered with in recent years. That group includes the junior Dezer, Terra Group’s David Martin and Brett Mufson of Fontainebleau Development.
Many of them, like Jon Paul, cut their teeth during the last recession.
“Jon Paul has been able to take real estate friendships and convert them into successful joint venture partnerships,” said Scott Wadler, managing director in the Miami office of Berkadia, a capital markets advisory firm co-owned by Berkshire Hathaway and Jefferies Financial Group.
Wadler, a friend of Jon Paul’s, is listing Related and Block Capital’s Domio Wynwood, an apartment-hotel hybrid that hit the market a few months ago. Inside Related, Jon Paul is busy looking for the hustlers who have the drive to succeed and wear multiple hats.
“He’s very focused on finding the stars who are going to bring in business and development opportunities,” Wadler noted.
Though he isn’t politically outspoken like his father, a longtime Democrat, Jon Paul is finding his own place in South Florida. He’s a member of the Wynwood Business Improvement District board and sits on the Urban Land Institute’s Southeast Florida/Caribbean advisory board.
Albert Garcia, the BID’s chair, said Jon Paul’s approach to developing in the neighborhood — which included a massive mural on the northeast side of Wynwood 25 by artist El Mac — alleviated “a lot of the anxiety” that surrounded Related’s expansion plans in the neighborhood.
“I think he understands the role that individual projects play,” Garcia said. “This is not going to become Brickell, this is not going to become Miami Beach.”
The new guard
The pandemic disrupted many things, but not Jorge Pérez’s succession plan.
“Jorge had a timespan during which he just wanted Jon Paul to experience things a little differently,” said Henriques, who advises on Related’s executive team, which Jon Paul has been a part of for years.
Jon Paul worked under former condo development president Carlos Rosso, who recently left the company after working for Jorge for 18 years, and briefly for Jon Paul. For Rosso, it was time to move on, though he will continue to work with the company on specific projects.
Henriques said that Jon Paul got his start at Related Group working under the division heads as one of their employees. “Transitioning from being an employee to being the boss requires changes in behavior, changes in relationships. The pandemic helped to cement some of those changes,” he said.
It’s important to give the next leader in a family firm the chance to make mistakes, own up to them and learn from them, said Katz of Aztec Group. How he or she relates to administrative staff and other company executives is also key.
“A lot of people simply don’t know how to stand up and say, ‘It’s on me,’” Katz noted. “To lead a company is a totally different ballgame. Some do it well and some don’t.”