Business

Trump, two hurricanes, tourism and technology — the biggest business stories of 2017

When we look back on 2017 in South Florida, there was Hurricane Irma — and then there was everything else. The storm made landfall on Sept. 10, just a week after most people had even heard of it. Our region was largely spared, but the storm’s effects linger for many — especially in our island neighbors, where Irma, along with Hurricane Maria, robbed so many of their homes and livelihoods.

While the hurricanes felt like the year's biggest story, there were other events with deep, long-term ramifications for Miami-Dade and Broward. Here's a look back at some of the stories that shaped the economy and business in South Florida in 2017 — and will likely continue to do so in the year to come.

As Hurricane Irma made its way through Florida, downtown Miami found itself flooded on Sunday, Sept. 10, 2017.

1. Hurricane Irma slams South Florida

The monster storm’s last-minute veer away from Miami spared the city from the expected nightmare scenario. But Irma’s close call, which caused an estimated $50 billion of damage throughout Florida, revealed significant — and previously hidden — weaknesses.

Most tragic were the 12 heat-related deaths at a Hollywood nursing home that unveiled the state’s lax oversight of such facilities. Other less-deadly but widespread issues included the failure of Florida Power & Light’s power grid despite $3 billion worth of improvements; the long wait for cable, internet and cellphone restoration so critical in this age of digital dependence, and the vulnerability of construction cranes and waterfront real estate. And perhaps most consequential was how Florida’s rapid growth has overtaken its infrastructure, turning evacuation efforts into a nightmarish jumble of bottlenecked traffic, gridlock, gas shortages and boiling tempers.

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In the storm’s aftermath, some airlines were accused of price-gouging after raising their prices as high as $3,000 for flights out of Miami ahead of the hurricane, leading Attorney General Pam Bondi to activate a hotline for consumers to report abuse. Not all companies tried to benefit from the mess: Some cruise lines made the unprecedented decision to send their ships on rescue missions, inconveniencing tourists but helping to deliver provisions and transport rescue-stranded travelers across ports that were hit hard by Irma.

Waves from Hurricane Irma break over the Southernmost Point monument in Key West, Florida, as the storm approaches the Florida Keys.

2. Conch Republic battered

Unlike Miami-Dade, Monroe County took a direct hit from Hurricane Irma. The Category 4 storm killed nine people, left 10,000 residents homeless, took a huge bite out of the county’s $2.7 billion tourism industry and resulted in layoffs and a severe shortage of affordable housing. Still, early signs indicate the Florida Keys will eventually rebound: Key West’s annual Fantasy Fest, for example, went on as planned just a few weeks after Irma’s visit.

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3. Marlins finally sold

Beleaguered — and highly unpopular — Miami Marlins owner Jeffrey Loria sold the money-losing baseball team for $1.2 billion , with the winning bid finally going to a group led by investor Bruce Sherman and Derek Jeter. The new owners slashed $45 million from the payroll by trading three former All-Star players — including MLB MVP Giancarlo Stanton — for minor-leaguers, citing the team’s previous lack of success and the franchise’s low revenues for the unpopular trades. Their onfield outlook for 2018 looks bleak — they could be the worst team in baseball next season — which won’t help the Marlins’ lack of sponsorships or lousy attendance. The team also has one of the crummiest local TV deals in the majors; its inability to sell naming rights to a ballpark that opened in 2012 cuts off another revenue stream. In other words, things for the Marlins likely will get a lot worse before they get better.

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4. Trump cracks down on Cuba

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President Donald Trump rolled back many of President Barack Obama's efforts to repair the United States' frayed relationship with Cuba. Trump banned most U.S. business dealings with 180 companies, hotels and stores controlled by the Cuban military; barred U.S. investment in an economic development zone near Mariel deemed critical to Cuba's commercial future; and made it harder for individuals to travel to Cuba. Airlines cut flights to the island as demand softened, while cruise lines continued to add itineraries. The long-term impact on businesses and individuals on both sides of the Straits is yet to be determined.

5. Puerto Rico devastated by Hurricane Maria

More than 200,000 Puerto Ricans fled to Florida after Hurricane Maria stormed through the Caribbean island on Sept. 20, flattening buildings, causing flooding and leaving most of its three and a half million residents without power. While most headed to Central Florida, Miami also braced for a wave of new residents. The total number of hurricane-related deaths is not yet clear — estimates range from the official government number of 64, to more than 1,000, according to the New York Times — and repairs to the island's infrastructure are expected to stretch on well into 2018 and beyond.

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All those displaced Puerto Ricans now on the U.S. mainland are now eligible to vote in elections. The length of their stay here is also yet to be determined — two elements that could impact everything from Florida’s government to its labor force and housing prices.

6. Miami housing costs continue to crunch workers

The chasm between rising home prices and stagnant median incomes in Miami continued to widen, catapulting the city into the fifth spot in a list of the 10 least affordable housing markets in the world. Renters didn’t fare much better: The number of low-priced rentals (under $800 a month) has declined 13 percent over the last decade, while the supply of high-priced rentals ($2,000 and up) has more than doubled, shooting up 148 percent. One study ranked Miami-Dade as the worst city in the U.S. for renters, with nearly 34 percent spending more than half their paychecks on rent.

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For hotel workers in Miami-Dade’s crucial tourism industry, the disparity between rent and income creates a third obstacle: Grueling commutes on limited public transportation that, for some, can last four hours roundtrip.

7. Local tech industry rises, slides

After years of trailing Austin, Texas, the Miami-Fort Lauderdale area ranked tops in the U.S. for new startup activity in 2017. But not all of those businesses are thriving. Miami-Fort Lauderdale ranked 36th out of 40 metropolitan areas for entrepreneurial growth, weighed down again by an abundance of small businesses with four employees or fewer.

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Still, the region’s tech industry continued to make progress. Broward-based Magic Leap unveiled a mixed-reality headset, backed by $1.9 billion worth of corporate investment, that will hit the market in 2018 and could revolutionize industries from retail to gaming. Meanwhile, the Little Haiti-based Magic City Innovation District announced a creative and capital partnership with Cirque du Soleil creator Guy Laliberté that will give the planned 17-acre, tech-company-driven neighborhood a boost in profile and drawing power.

8. Florida film industry outlook dims

Two months before the made-in-Miami “Moonlight” won Oscars for Best Picture, Best Adapted Screenplay and Best Supporting Actor, the Florida Legislature declined to re-fund the tax incentive program instituted in 2010 that helped lure Hollywood movie and TV production to the state, essentially killing out-of-town film production. In Miami-Dade alone, the toll was 4,900 jobs, $249 million in personal income and $20 million in tax revenues.

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A handful of projects aside — Sean Baker’s acclaimed “The Florida Project,” the upcoming TV series “American Crime Story: The Versace Murder,” and director Harmony Korine’s “The Beach Bum,” which is currently filming with stars Matthew McConaughey and Zac Efron — the state’s film industry has flatlined. Still, smaller incentive programs launched by individual cities and municipalities (including Miami-Dade County, Miami Beach and North Miami) offer a bit of hope for the future.

9. I-95 remains gridlocked

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There’s nothing new about South Florida traffic jams or the frustration they invoke. But 2017 brought hope that the time-and productivity-sucking gridlock might soon be lessened. Metrorail added four new rail cars (the equivalent of one train) to its overtaxed public transportation system — the start of a $380 million retrofit, due for completion in 2019, that is intended to restore the service to its original 21-train fleet and make the service more timely and reliable. Florida East Coast Industries' much-anticipated Brightline rail service linking West Palm Beach, Fort Lauderdale and Miami’s downtown areas missed its target launch date of September but is expected to finally roll out in early 2018. And Miami-Dade Mayor Carlos Gimenez implored the Greater Miami Chamber of Commerce to consider a rapid-transit electric bus system, already in use in China, as another way of alleviating the city's traffic congestion woes.

Traffic should also be eased — at least a little — by the hundreds of apartments and condos being built near or around transportation hubs. Residents of the massive Miami Worldcenter project, which covers 10 city blocks in downtown Miami, presumably won't need a car to get to and from places of work and play. But many of these new developments are still two or three years away from completion — which means your commute to and from work won't be getting shorter any time soon.

10. Airbnb survives in South Florida

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While home-sharing platforms like Airbnb continued to be popular with travelers, the debate over whether they should be allowed in local neighborhoods grew ever-more heated. In 2016, Miami Beach levied the nation's highest fines for hosts in most parts of the city. Early this year, then-Miami Beach Mayor Philip Levine went on a Twitter tirade against the platform, while then-Miami Mayor Tomás Regalado proposed an outright ban that was ultimately struck down by the courts. Miami-Dade and Broward both forged tax deals with Airbnb, a win for the platform in two of its busiest counties. In the fall, Miami-Dade County finally passed regulations that allow residents in unincorporated Miami-Dade to participate in the vacation-rental trend while promoting peace and safety.

11. Cruise industry goes high tech

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Cruising prepared for a high-tech future when Carnival Corporporation unveiled a new super-smart framework that could revolutionize the entire industry. Using a disc the size of a quarter that passengers carry with them, the technology will open cabin doors for passengers as they approach, alert them of recreational activities specifically paired to their interests — and even track their location to deliver them cocktails, wherever they’ve wandered on board. (As with many things tech, the original roll-out date of fall 2017 was moved to spring 2018.) Royal Caribbean, Norwegian and MSC Cruises also have introduced apps and wearable devices that will open stateroom doors, facilitate dining reservations and eliminate check-in lines.

Chabeli Herrera, John Devine and Jane Wooldridge contributed to this report.

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