Silicon Valley Office Space Boom Driven by Tech
A boom in the construction of Silicon Valley office space has been attributed to the continued take-up by technology companies, it has been reported.
Commercial estate construction and renovation in Santa Clara County and San Mateo county has taken an upturn in recent months, with developers working on roughly 6 million square feet of office space - doubling the enterprise of last year.
More than one-third of the space under development has already been aquired by technology firms set on expansion, according to Jones Lang LaSalle (JLL).
6.2 million square feet - space for 31,000 employees to take up workstations, is under construction, JLL estimated. Colliers construction pipeline and broker puts the figure even higher: 6.5 million square feet.
"We are starting to see some very tight office markets in Santa Clara County," said Andy Poppink, managing director for JLL.
"It's mainly access to talent," said Tim Bejarin, principal analyst for Cambell-based Creative Strategies. "Silicon Valley has the richest pool of young tech talent in the world."
Around 4.9 million square feet of the current building activity is to be new office space, JLL estimated. The rest - around 1.3 million square feet - involves major renovations of existing space.
"Social networking, Internet, and cloud technology companies are the primary drivers of the growth," said Phil Mahoney, an executive vice president with real estate firm Cornish & Carey.
"We see a lot of optimism about growth on the part of the biggest tech companies and a lot of smaller ones," said Chad Leiker, vice president with real estate firm Kidder Mathews.