Since the epic explosion of technology use in people’s daily lives, start up companies have been popping up since the year 2000 and have been growing exponentially since. New York City is one of the largest tech hubs in the Unites States, and to keep up with the frequent growth they’ve had to tweak a few things to buffer the influx of companies and their employees. An article in the ‘Huffington Post’ outlines a few of the changes made by the tech bubble increasing in size.
Since tech is such a massive cash cow, companies and start ups that burst into the business world tend to flourish fast which means they need commercial real estate. Even if they start as a small company, well rounded and backed start ups can double their size within a year, which means larger scale real estate is required. The tech industry overtook 19% of leasing activity in NYC real estate, according to Town Real Estate in 2014, the percentage itself was guesstimated to be much lower on the spectrum. Capital from investors is being mainlined into the tech scene of the city, a report from CBI stated the average Series B financing sky rocketed from $6 million in 2013 to $17 million this year alone. With the mass amounts of space needed in such a small area, commercial real estate prices in places such as Flatiron, Chelsea, and Union square have jumped up 80%.
With the younger generation running most of the tech companies the style of their desired office space is completely different from the traditional, run of the mill cubicles with grey carpet. Their unique designs and modernized interior wishes call for exposed brick, loft spaces and open floor plans. These tech companies have landlords changing up their buildings to cater to these companies by knocking out walls and giving it a new, industrial feel.
Employees of the tech companies need a place to live, some can afford luxurious apartments while others go to lower income neighborhoods. These well educated and young people have been turning outdated neighborhoods back into hot spots, igniting a new flame in rural areas. The proof lies in the massive 40% raise of college educated people living in places like Long Island and Astoria since 2008. Change is the only consistency and as the tech market grows, NYC real estate will mold with the change as well.