It almost goes without saying that as the country's recovery continues at full steam, office space in tech-heavy global gateway markets like San Francisco, Seattle, New York and Boston remains hard to find and relatively expensive. However, these markets aren't the only ones experiencing rent growth.
Two different factors are driving the growth of rents in many secondary markets. First, overflow from the primary markets helps to increase demand for secondary spaces. Second, Generation Y's urbanization patterns are different from those of previous generations. While older Americans moved to the gateway cities as a part of starting their lives, Millennials are more open to living in smaller communities. To them, living in a city is key -- any city.
Traditional Secondary Markets
Some of the secondary markets that are popular for tech-oriented office space have been popular for a long period of time. Austin, TX, which is home to both a major research university and to high tech companies like Dell. Over the period from 2012 through 2014, it achieved 33 percent tech job growth.
Raleigh-Durham, NC is another popular secondary market. Hosting multiple major universities and one of the country's largest technology office developments -- the Research Triangle Park -- the Triangle region has been a major destination for companies seeking highly skilled labor for decades. However, it still offers reasonable costs for office space relative to primary markets.
Emerging Secondary Office Markets
In addition to the traditional tech-heavy markets, ongoing demand for office space is pushing companies to look at additional non-traditional markets. Locations in these cities allow companies like yours to leverage otherwise untapped talent pools while also offering access to low cost space options.
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Salt Lake City, UT. Salt Lake City offers a unique blend of attributes. Its Mountain location places it within a couple of hours flight of both San Francisco and Seattle while making outdoor activities an easy drive away. The University of Utah is a major incubator of both skilled entrepreneurs and tech workers while the skills and work ethic of the local work force are some of the country's best.
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Phoenix, AZ. Ample housing and office space coupled with proximity to Southern California and a major hub airport make Phoenix a popular back office city for tech companies. With 43 percent growth in technology jobs between 2012 and 2014, this community enjoys comparable employment growth to Silicon Valley.
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Nashville, TN. A new "cool" vibe and affordable costs of living are driving tech jobs to Nashville. While job growth is slower than in Phoenix and San Francisco, it still outstrips the rest of the country by a healthy margin.
- Charlotte, NC. Charlotte grew its pool of tech jobs by 17.3 percent between 2012 and 2014. Given its status of a global hub for the finance industry coupled with proximity to major manufacturing facilities, this community offers a mixed economy that supports a wide range of different high tech positions.
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