Stephen Ross Steps Down From Related To Launch New Florida Firm
Stephen Ross is stepping down as chairman of Related Cos., the influential development firm he founded, and spinning off the firm’s Southeast division into a new company under his control.
Related Southeast, the arm of the development firm active in West Palm Beach, will become a separate entity called Related Ross, the firm announced in a memo to staff, which was obtained by Bisnow.
Ross, 84, will be replaced by Jeff Blau, Related Cos.' CEO since 2012, The Wall Street Journal reported. President Bruce Beal Jr. and Chief Operating Officer Kenneth Wong will help lead the company.
“Stephen is excited to lead the team in the West Palm Beach office as the head of Related Ross,” says the email to staff, which was signed by Ross, Blau, Beal and Wong. “This change also means that Stephen will step away from his day-to-day work at Related Companies and transition into a non-Executive Chairman role.”
Ross told the WSJ, which first reported the split, that his firm and Related Cos. could work together in the future.
The memo to staff implies that staff and assets at Related Southeast’s office will transition to Related Ross. The nascent firm is already the largest owner of downtown commercial space in West Palm Beach and Palm Beach County's largest developer, according to the WSJ.
“While Stephen is stepping back from daily management at Related Companies, he remains incredibly invested and will continue to actively support our future success,” the memo says, noting that a transition plan was first put in place more than a decade ago.
Ross, who attended high school in Florida and owns the Miami Dolphins, founded Related in 1972. It started in affordable housing but grew to cover all asset classes. He’s been active in South Florida since at least 1979 when he invested with Related Group’s Jorge Perez.
The two firms, one based in New York and the other in Miami, worked together in the region until late 2022 when an amicable breakup of the partnership was announced.
Related’s properties in West Palm Beach span nearly every asset class. It developed the 35-acre retail center CityPlace downtown in 2000 and has in recent years been repositioning the asset into a mixed-use property with a focus on trophy office space. The firm also broke ground on its first luxury condo building in Florida at a waterfront site in the city.
A person familiar with the transition said those assets would be managed by Related Ross, but it wasn’t immediately clear if Related Cos. is holding on to any properties in the city. The person also said Ross is maintaining his stake in Related Cos.
Ross moved to South Florida in recent years and has made no secret of his dream to transform West Palm Beach. The billionaire hosted a fundraiser in April where Palm Beach’s high society rubbed shoulders with Vanderbilt University Chancellor Daniel Diermeier as part of a bid to raise $300M to lure the college to the city.
“Stephen Ross is a visionary and his commitment to our City is unparalleled and unmatched," West Palm Beach Mayor Keith James told Bisnow in a statement. “I look forward to working with Stephen Ross and his newly created company, Related Ross, in pursuit of the commitment to ensure all residents are included in the halo effect of inclusive growth in our great City.”
A Related Southeast executive outlined Ross’ vision for the city at a Bisnow event in December.
“Chairman Steve Ross’ vision for West Palm Beach is to make this the model American city, and he's working very closely with the mayor on that,” Related Southeast Senior Vice President Jordan Rathlev said onstage. “That's attracting new healthcare, affordable housing and new education. We're in talks to bring charter, public and private schools to the market and higher education to the downtown to be able to grow the local workforce.”
Prior to Thursday’s announcement, Related Cos. had around $60B in assets and property under development across the country. It is among the top developers in New York, where the firm has built massive projects like Hudson Yards, the $25B mixed-use complex where Related and Wynn Resorts hope to add a casino.
The memo to staff says the firm will “continue to take business to new heights” with luxury residential projects in New York, Jersey City, Chicago, Boston, Austin, San Francisco, Los Angeles and London. It will focus on life sciences opportunities in Boston, the executives said in the memo, and data center development throughout the United States.
Florida cities were absent from Related’s target markets in the memo, which describes the staffing change as “the next chapter in the history” of the company.
“As it has been said, with change comes great opportunity,” the memo to staff says.
UPDATE, JULY 11, 4:40 P.M. ET: This story has been updated to include a statement from West Palm Beach Mayor Keith James.
