Step Aside San Francisco: The Tech Industry Still Calls the Silicon Valley Home

You wouldn't be alone if you thought the tech industry had shifted its base of operations from the Silicon Valley to San Francisco. A new study of the tech industry's real estate footprint, however, reveals the South Bay's entrenched dominance.

2 minute read

January 12, 2016, 8:00 AM PST

By James Brasuell @CasualBrasuell


Nathan Donato-Weinstein shares news of a new study by CBRE that "quantifies the Bay Area's tech footprint by industry subsector, revealing a number of interesting takeaways about site-selection trends, the state of the market and what risks might lie ahead for the regions' economies."

A key takeaway from the report: the commercial real estate market does not conform to the popular narrative about San Francisco emerging as a rival to the Silicon Valley's dominance as the geographic center of the tech industry. Donato-Weinstein explains:

While tech has certainly expanded in San Francisco ( hello, Salesforce Tower), the narrative may be overblown. In fact, the broader industry has continued to grow in its traditional South Bay stronghold. About 73 percent of all of the Bay Area's tech-occupied real estate is located in Silicon Valley, compared to 13 percent in San Francisco, 9 percent on the Peninsula and 5 percent in the East Bay.

Not only is the Silicon Valley home to the most tech companies, it leads the Bay Area in density of tech companies:

The report found that Silicon Valley remains the most dense tech market in the Bay Area, with 2,400 companies occupying 52 percent of the Valley's entire real estate footprint, or 126.4 million square feet of space. That compares to San Francisco's 1,800 tech companies occupying 22.4 million square feet of space, or 29 percent of all space. The Peninsula's 400 tech firms take up about 14.9 million square feet, also about 29 percent of the total office and R&D real estate. And Oakland's 700 tech firms occupy 8.6 million square feet, or 8 percent.

The article also considers some of the policies that are contributing to the Silicon Valley's dominance in the tech industry, relative to the rest of the Bay Area, along with more details from the study's findings.

Thursday, January 7, 2016 in Silicon Valley Business Journal

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