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Silicon Valley Tech Companies Flock to Denver for Talent and High Quality of Life

October 15, 2018

 

 

 

Silicon Valley Tech Companies Flock to Denver for Talent and High Quality of Life

The Bay Area has a new rival when it comes to attracting tech companies and talent: Denver. Boasting one of the lowest unemployment rates in the U.S. and the second best place to live according to U.S. News and World Report, Denver has become a desirable location for major tech companies and startups. From the Google campus in Boulder to Slack eyeing a 50K SF space in downtown Denver, 22 tech companies either opened satellite offices or moved their HQ to the Denver Metro Area in the past year. migration of tech talent from the coast to the mountains has become the focus of Pivot To Colorado, a public-private initiative to poach talent from the Bay Area. The $500K campaign has used billboard ads and digital marketing to convince prospective new arrivals that the city fosters more community and less competition. In the Bay Area, that competition includes the search for affordable housing. Rents in the Bay Area are among the highest in the U.S. While the population and construction boom has led to affordability concerns among Denver residents, the metro area remains affordable relative to housing costs in other cities on the West Coast. As of October, the average rent for an apartment in Denver is $1,535, a 1% year-over-year increase, RentCafé reports. Tech companies, in response to the influx of talent, have taken over 849K SF of new office and commercial space between Fort Collins and Colorado Springs between July 2017 and June 2018. Denver can also offer something more than an abundance of jobs and a lower cost of living. metro area, surrounded by mountains, hiking paths and numerous indoor/outdoor spaces, is in the vanguard of the growing trend toward office wellness. “Companies have realized that the tech talent pool isn't only in the Bay Area, and Denver has a lot to offer in the realm of young tech talent,” stok Project Manager Jeremy Attema said. “ cost of living is getting outrageous in the Bay Area and tech companies are struggling to attract the talent that they want. Many people are looking at cities that can offer the same amenities the Bay Area can, and Denver fits that well.” A high-performance real estate services firm, stok is focused on improving the built environment with regenerative and human-centric design. company balances clients’ financial and performance goals with sustainability and occupant wellness. It focuses on the design and implementation of high-performance buildings, which are designed to improve occupant productivity, comfort and health. Essential design strategies for high-performance buildings to enhance occupant performance and experience include, but are not limited to, indoor air quality and ventilation, thermal comfort, natural and artificial lighting attuned to circadian rhythms, noise and acoustics, active design, outdoor views and biophilic design, which mimics the materials and shapes of the natural world to promote wellness. Denver has become a leader in this new type of development, Attema said. As the seventh healthiest city in the U.S., according to America's Health Rankings, wellness is ingrained in its culture. “Championing the health and wellness movement in this region is critical because Denver and Colorado overall are very healthy and physically active,” Attema said. “Residents get outdoors more than other areas in the country so bringing that into the office makes a remarkable difference.” Tapping into the growing demand for health and wellness design in the workplace, stok implements biophilic design principles that integrate nature with design to create habitats where people thrive. company has explored this design strategy across several projects in Denver, as design has an influential role in fostering health and wellness. “It’s more than just having a living wall and putting a planter every 50 feet,” Attema said. “It’s so much more than that. Biophilic design involves using natural colors, elements and materials integrated with natural forms, patterns and daylight. And it’s not qualitative jargon — these strategies have been tested and proven. High-performance buildings really impact people’s ability to function in the built environment.” Building with occupant health and wellness in mind has a significant financial benefit. Focusing on wellness upgrades can create over $23K of net present value profit per employee over 10 years, according to a new white paper from stok. Combined with Denver’s lower cost of living compared to the Bay Area, moving an office to Colorado offers savings for both the employer and the employee. While many tech companies moving to the Denver area are either smaller tech companies or satellite offices, with time these companies will grow and mature as the Denver lifestyle draws more talent and becomes a major tech hub, Attema said. Wellness-oriented office buildings could help fuel this growth, should the city find a way to entice developers on the multifamily side to build more affordable housing. “If Denver continues to offer this high quality of life and keeps [housing] affordability relatively stable, there is no reason Denver can't move from a secondary market to a primary market like Seattle, riding on the backs of tech companies,” Attema said. (Bisnow)

 

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Emerging Trends Ranks Denver in Top 10

Denver made the Top 10 list in the latest Emerging Trends in Real Estate 2019 report, which was released Wednesday. Denver was ranked No. 8 of 79 metropolitan statistical areas in the comprehensive Emerging Trends report released by PwC US and the Urban Land Institute. In the Rocky Mountain region, Denver ranked first of eight cities. The Dallas-Fort Worth area was ranked first. The Emerging Trends report, in its 40th year, is compiled based on interviews and surveys from almost 2,400 leaders in real estate. They include investors, fund managers, developers, property companies, lenders, brokers, advisers and consultants. Market strengths of Denver, according to anonymous sources quoted in the report, include:

•Growth of DIA as major international airport, with land to develop around it;

•Growing tourism and convention market that has fueled the hospitality industry; and

•Availability of key parcels, including infill sites in the city.

Denver, according to Emerging Trends, shares many of the same traits as other cities in the Mountain Region, including Salt Lake City, Phoenix, Las Vegas and Boise, Idaho. “The quality of life offered in the Mountain Region should continue to be attractive to millennials looking to start families,” according to the report. The report also noted that the 2019 population growth rate is projected to be “well above the national average” in the Mountain Region, including Denver. Population growth “is needed to support the growth of their economies” and the Mountain Region is expected to outpace the nation’s growth not only next year but also for the next five years. The report went on to say that net migration is “particularly strong” in Denver, Phoenix and Las Vegas. However, Denver is one of the few markets in the Mountain Region where housing is not affordable, putting Denver at a competitive disadvantage. Other markets in the region remain relatively affordable, “although to some extent they have been victims of their own success,” according to Emerging Trends. “Single-family home affordability in Denver is now below the national average, while affordability has trended down in Las Vegas and Phoenix,” according to the report. Still, “Real estate development and investment activity is robust in all of the markets in the region. Phoenix, Denver and Salt Lake City report strong activity in nearly all property types,” according to the Emerging Trends report. One cool thing about the Emerging Trends is that the cover photo of the report was of Wynkoop Plaza at Union Station. The photo was taken by Denver-based photographer Ryan Dravitz. (Colorado Real Estate Journal)

 

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Belleview Station Nets Second Fortune 500 Company as Urban Development Springs from Suburban South Denver

Two commercial buildings, two Fortune 500 company headquarters. That’s the scorecard so far for Belleview Station, a 51-acre, mixed-use project coming out of the ground around the Belleview Station light rail stop in south Denver. With its walkable, urban design, collection of hip restaurants and Denver mailing address, veterans of the south metro real estate market are projecting that Western Union and Newmont Mining won’t be the last big fish the project reels in as it grows. Western Union is settling into seven and a half floors of the One Belleview Station building, 7001 E. Belleview, after leaving a nearby Douglas County business park earlier this year. But Newmont was the toast of the master-planned neighborhood Thursday as company officials, development partners, real estate brokers and Denver Mayor Michael Hancock gathered to celebrate work getting underway on the 15-story office tower that it is set to move into in 2020. Like Western Union, Newmont isn’t traveling far. Corporate HQ today is in the Palazzo Verdi building in Greenwood Village, 2.5 miles south of Belleview Station. But the forthcoming building, named 6900 Layton, offers things its 10-year-old Greenwood Village counterpart doesn’t. “It gave us a chance to move to a new building and remodel without having to do that in place,” Newmont executive vice president Bill MacGowan said at Thursday’s event. “Really cool amenities and a great site. (Being in) the city of Denver was really important to us as well.” Newmont, the country’s top gold producer, will move 400 to 500 employees into four floors of 6900 Layton, MacGowan said, with an option to take on a fifth. The building — for now a large hole in the ground at the southeast corner of Layton Avenue and South Newport Street — is being developed by Prime West Cos. Prime West developed, sold and keeps an office in One Belleview Station. The 380,000-square-foot Layton building, being backed financially by Switzerland-based Partners Group and built by the Weitz Co., will have plenty of attractive features inside: column-free floor plates, a fitness facility with yoga room, bike storage and a west-facing outdoor terrace. But it might be what’s outside that counts most for the workers who report there. Gradually developing since 2012 under the guidance of family-owned property owner Front Range Land and Development, Belleview Station is home to nearly 700 apartments and 80,000 square feet of ground-floor retail space today, with a half-dozen more development sites in waiting. The office buildings and future office sites are grouped on the east side to provide walking-distance access to light rail. Leasing agents brought in trendy businesses like Troy Guard taco joint Los Chingones, conveyor-belt sushi stop Sushi-Rama and Denver-born Corvus Coffee Roasters. That style of development — urbanization of the suburbs, as many real estate conferences refer to it these days — is a selling point for employees, said Ryan Link, a senior vice president with real estate services firm CBRE. With Colorado’s unemployment rate below 3 percent, it can provide an edge when it comes to hiring. “Companies and clients of ours are using their real estate to recruit and retain employees,” Link said. “I believe a lot of the excitement around (Belleview Station) is it is creating a very mini downtown.” Greenwood Village last year considered amending the city comprehensive plan to clear the way for more dense mixed-use development on a 44-acre site around its Orchard Station light rail stop, but city voters rejected that proposal largely because they didn’t want urbanization. There are other factors that make Belleview Station a draw, said Frederic de Loizaga, Link’s partner in the southeast metro market for CBRE. CBRE competitor Cushman & Wakefield is handling leasing at 6900 Layton. The project is new, providing higher-quality options than much of the existing office space in the Denver Tech Center/South Metro area, de Loizaga said. South metro rents remain $10 to $15 cheaper per square foot on average than in buildings downtown. Then there is that Denver mailing address — something Western Union, a company that advertises on the Denver Nuggets’ jerseys, has made it clear it values. Will more big-name businesses move out of office parks and into Belleview Station and other denser, urban-style developments like it in the future? “The quick answer is yes,” de Loizaga said, “you’ll see more of it.” (Denver Post)

 

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