This week, Cushman & Wakefield announced “Tech Cities: The Global Intersection of Talent and Real Estate.” This new report examines the top drivers of technology tenant location strategies, identifying the top global technology markets and their impact on technology company offices. real estate. In the report, the company ranks Denver-Boulder as the top tech city in the Americas based on a variety of factors.
On a global scale, technology represents an ever-larger share of major economies and commercial real estate. Over the past decade, global technology employment has increased significantly. Across the world’s 15 largest economies, telecommunications employment has grown by nearly 23 million, and is projected to grow by 17% over the next decade, adding another 12 million workers.
David C. Smith, Global Head of Occupier Insights at Cushman & Wakefield, said: “Even with recent economic volatility, the demand for tech talent is not going to abate anytime soon. It remains important.”
Demand for tech talent is on the rise after a sharp drop in mid-2020. Globally, job openings for technical positions (computer programmers, IT network professionals, analysts, data scientists, etc.) increased by more than 50% in his first year of the pandemic. In his 10 largest economies in the world, he now has 2.7 million more workers in his office than at the start of the pandemic.
Cushman & Wakefield selected over 115 different technology cities around the world to assess talent availability and costs, office real estate, and business climate. Top technology hubs in each region of the world aggregate 14 factors, weigh each according to their perceived importance in market selection criteria for technology companies, and validate through rigorous model testing with industry experts. identified by
In North America, the San Francisco Bay Area ranked as the top tech city, followed by Toronto, New York, Seattle, Los Angeles, Atlanta, Washington DC, Dallas-Fort Worth, Boston, and Montreal.
Talent continues to be a key resource for tech tenants to evaluate potential locations. The San Francisco Bay Area leads North America with about 280,000 tech jobs, followed by New York with 259,000 jobs and Washington DC with 216,000 jobs.
“Finding and retaining top talent is a top priority for tech companies, especially given the tight labor market and the technical skills some tech companies require,” Smith said. .
Markets such as Toronto and the San Francisco Bay Area will continue to be hotbeds for the tech industry. Even a market with a medium-sized labor pool, like Montreal, can have a good balance of attractive talent.
The biggest cost for tech companies is people. The San Francisco Bay Area continues to live up to its reputation as the most costly market for tech talent in North America. Across 100 global markets, the average base salary for a data scientist is $90,000, while in San Francisco his Bay Area average salary is over $150,000. The Sunbelt market, like the Canadian market, offers savings compared to major tech hubs in the United States. For example, Toronto’s weighted average base salary is two-thirds that of the San Francisco Bay Area and 20% less than Seattle’s.
Tenants are looking for opportunities to save on leasing and building out high-quality office space that is central to innovation and collaboration. Real estate costs in North America are highest in traditional major cities such as New York ($78 psf), San Francisco Bay Area ($76 psf) and Toronto ($66 psf). You can find cost-effective options in many parts of Latin America, including Kansas City ($23 psf), Cincinnati ($23 psf), and St. Louis ($19), as well as secondary markets in the US Midwest.
As flexibility increases, the quality and location of office space becomes more important. It is important to identify markets with dynamic ecosystems of high-tech companies and employees, and with sufficient availability of high-quality office space. Construction deliveries continue to create opportunities for tech companies to move into new, high-quality spaces that attract and retain talent in a vital labor market.
In the Americas, New York City has the deepest pipeline of office space under construction, at over 16 msf. However, as a percentage of current inventory, it is only 6% of current inventory in Manhattan, well below the share of under-construction inventory in Vancouver, Austin, and Toronto, which accounts for more than 9% of current inventory under construction. .
Click here to view the full report.