Tech firms want NY, but does NY want them? Low vacancy makes it hard for growing tech companies to be flexible.
JLL’s Paul Formichelli (second from right) traveled from NY to Austin’s SXSW Interactive gathering, which ended yesterday. Bisnow's Austin reporter was there, as well, and snapped him with colleagues Cara Trani and Amber Schiada of San Fran, Blake Searles of LA, Greg Matter of San Fran, and Joanne Bestall of Chicago. Paul tells us scalability can be easier outside NY. Subleasing can help flexibility, but once firms want to design and brand their space, direct leases become more important, he says. In NYC, the lack of available office space in Midtown South is driving techies into former industrial buildings in the Garment District and Brooklyn, he says. (It's an axiom throughout history: Tech space follows rave sites.)
The team’s other big takeaway: Tech is about more than just startups: Media, healthcare, banking, consulting, manufacturing, automotive, and retail are immersed in technology, too. And that factors into their real estate needs.
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