Sunday, 11 June 2017
Cushman and Wakefield's Tech Cities Report
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.