The arrival in Tampa of Gilded age industrialist Henry Plant and Spanish entrepreneurs Vicente Martinez Ybor and Ignacio Haya about 140 years ago changed the fortunes of a city, until then best known as a fishing village and desolate military post.
Plant, through a web of railroads and steamships, and Ybor and Haya, through their hand-rolled cigar factories, lured in workers from around the US as well as Cuba, Spain and Italy. In the span of a decade, Tampa’s population increased seven-fold.
Located on Florida’s Gulf coast, the city’s population continues to swell, but the industries attracting workers have completely transformed. Only one traditional cigar maker remains and the port, though still important, has made way for white-collar industries such as healthcare, education, real estate, finance and tech.
This economic diversity along with a drop in the crime rate and the city’s resilience to disruptions caused by US President Donald Trump’s trade war have propelled Tampa to the top spot of the third annual FT-Nikkei Investing in America rankings as the best city in the US for foreign multinationals to do business.
The uncertainty unleashed by Trump’s “liberation day” tariff blitz, the ensuing climbdown and his renewed threats of unilateral levies on America’s trading partners has muddied the outlook for local and multinational businesses looking to invest in the US. That has made it harder for them to forecast demand and estimate costs, potentially hampering investment decisions.
Those factors delivered a blow to Texas’s standing in the rankings. The Lone Star state, home to previous winner Houston and four other cities that placed in last year’s top 10, slipped down the leaderboard because of its exposure to international trade.
Imports made up roughly 7 per cent of Florida’s GDP last year, compared with 11.6 per cent in Texas. Tampa in particular has low export exposure, at about 4 per cent of its GDP, compared with nearly a third of city GDP for Houston.
“It’s an important industry, but it’s a relatively small share of the Tampa economy as a whole,” said Michael Coon, associate professor of economics at the University of Tampa. The city’s biggest imports are commodities such as petroleum products, limestone, coal, cement, and not necessarily manufactured goods, he said. “The demand for these is more inelastic . . . compared to tchotchkes at gift shops.”
Propelling Tampa to the top spot on this year’s list are its competitive business environment — spurred by incentive programmes offered by the city — quality of life and a skilled workforce. Low tax was also a plus: Florida has no state income tax and the corporate tax rate is 5.5 per cent.
“What I hear from the companies and CEOs that I speak to, is that one of the main factors in the decision of where to invest or where to bring their business . . . is the quality of life for their team,” said Jane Castor, the city’s mayor and a life-long Tampanian.
“The companies are clearly interested in our tax structure and the ease with which they can do business here,” she said.
The real draw, Castor believes, may well be what contrasts her hometown from the 24-hour, seven-days a week vibe of Miami on Florida’s Atlantic coast. “If you want a place that feels incredibly welcoming, you’re instantly a part of the community, you can raise a family, or the safest city our size in the nation, Tampa is the place that you want to go.”
Since 2000, Tampa’s population has increased 7.6 per cent to 414,547, similar to the state’s growth outpacing the 2.6 per cent rise for the rest of the US over the same period. The city boasts one of the largest school districts in the country, has undergone substantial improvements to its infrastructure to support more traffic and is home to one of the top airports in North America. Tampa has also built parks and recreational facilities to improve the standard of living for residents.
“Our waterfront has been our lifeline for years, but we had a visibly unattractive, but financially important waterfront for years,” said Rodney Kite-Powell, historian at Tampa Bay History Center. A multibillion-dollar development led by Strategic Property Partners — a real estate group backed by Bill Gates’ Cascade Investment — is revitalising the former industrial part of downtown Tampa.
A 15 per cent drop in the city’s crime rate, according to the Tampa police department, has also been welcome news for businesses. The city attributes last year’s fall, which compares to a 5 per cent decline nationally, to preventive policing and collaboration between residents, businesses and the police department.
Tampa secured a AAA credit rating from Fitch last year, signalling its strong financial position to companies considering investing there. The city’s “strong liquidity management of their budgets and maintaining excessive reserves to mitigate against financial downturns, storm events and other uncertainties” supported the upgrade, Fitch director of US public finance Kevin Dolan said.
Which is not to say Tampa is without challenges. A difficult storm season last year, with inland damage to properties from Hurricanes Helene and Milton, along with a softer real estate market could deliver a blow to Tampa’s property tax revenue. That could prove consequential for the city given there is no income tax.
Tampa could also invest more in its public transit, which would improve accessibility for its residents and make the city more liveable for its fast-growing population. “Our Achilles heel is transportation . . . I joke that our mass transit is more than two people in an SUV,” mayor Castor said, while acknowledging these efforts could take a long time to bear fruit.
So far, most of the multinationals with a big presence in the Tampa Bay area are American, including financial groups Citi, JPMorgan Chase and Raymond James, drugmaker Pfizer, accounting group PwC and biotech Amgen. Foreign companies including Japanese financial group Mitsubishi UFJ and Brazilian steelmaker Gerdau have a sizeable presence in the region, but the international influx is accelerating.
The city has used the allure of its growing medical and research district to seek out European life sciences companies, with the industry projected to grow 6 per cent over the next five years. German medtech company Medability recently picked Tampa to be the site of its new US headquarters because of its thriving life sciences ecosystem.
Global Tampa Bay, a cross-county partnership that seeks to lure in international business, makes routine overseas pilgrimages to market the region globally. Mayor Castor recently visited London as part of the group and said about 20 to 30 companies from the UK were interested in setting up shop in the Tampa Bay region. She has also had encouraging conversations on trips to Vancouver and Tokyo.
“We are focused on growing businesses from the ground up here in Tampa, and small businesses really are the backbone of our community, but we are always looking to attract businesses,” Castor said. “Going out and selling the city is, I believe, very very important.”
