Cushman and Wakefield, the global commercial real estate
firm, has released its first tech cities report. The report attempts to ascertain which are
the most successful “technology cities” in the United States. The report notes that so-called tech cities
outperform other cities in terms of commercial real estate value and other
factors, but no one has attempted to determine exactly what is a “tech city.” That is what Cushman and Wakefield attempts by
looking at factors leading to a “tech stew”.
“Tech stew” is the term encompassing the characteristics leading to
development of a tech city. Some of
those factors include: institutions of higher learning; venture capital; tech
workers; knowledge workers; educated workers and growth entrepreneurship. For example, universities of higher learning
noted for San Francisco and San Jose include: UC Berkeley, Stanford, UC Davis, University
of the Pacific, Santa Clara University and University of San Francisco [a notable
omission is UC San Francisco]. For
venture capital, the report notes San Francisco/San Mateo at the higher end for
2016 with $28.5 billion and New York City at $9.1 billion. Growth entrepreneurship uses the Kauffman
Foundation’s metrics to measure firms with a high likelihood of growth. Notably, Washington DC, Austin, Silicon
Valley, Nashville, and Boston are the top five U.S. cities for growth
entrepreneurship.
The top ten tech cities are: 1) Silicon Valley; 2) San
Francisco; 3) Washington DC; 4) Boston; 5) Raleigh/Durham/Chapel Hill, North
Carolina; 6) Seattle; 7) Austin; 8) Denver; 9) San Diego; and 10) Madison,
Wisconsin. This list is not too
surprising; although a few notable missing cities from the top ten include: New
York City (15) and Los Angeles (18).
Oakland/East Bay is also considered separate from San Francisco and
Orange County is separated from Los Angeles. From the commercial real estate perspective,
the report notes that rents have increased almost 20% more since 2010 in the
top 25 tech cities than in the rest of the United States.
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