Research - NOVEMBER 20, 2017

San Francisco named number 1 high-tech job growth market

by Andrea Waitrovich

Tech jobs grew four times faster than the national average, according to CBRE Research’s 2017 Tech-30 report.

San Francisco was the top high-tech job growth market for the sixth year in a row with a 39.4 percent job growth from 2015 to 2016, or 22,367 tech jobs added. Eight of the 10 largest leases in 2017 were by tech tenants, and large requirements from tech companies make up a significant amount of current demand with multiple active requirements of more than 100,000 square feet. San Francisco large office construction projects will add 6.6 million square feet to the market and are largely pre-leased by tech companies.

Charlotte, N.C., followed in second with 31.6 percent job growth and Pittsburgh (31.4 percent job growth), Indianapolis (27.8 percent in job growth) and Phoenix (25.4 percent in job growth) rounded out the top five.

The influence of tech job creation on office market rent growth is clear, with 13 of the Tech-30 markets posting rent growth of 10 percent or more between the second quarter 2015 and second quarter 2017. Orange County, Calif., was the top market for rent growth, followed by the lower-cost markets of Nashville, Atlanta and Charlotte. Furthermore, office rents with the Tech-30 increased in every primary tech submarket between the second quarter 2015 and second quarter 2017. The highest rent growth during this period came from both established and up-and-coming tech submarkets, illustrating stiff competition for talent in such markets as Tempe, Ariz.; East Cambridge (Boston); North Loop (Minneapolis-St. Paul).; and South Orange County (Orange County, Calif.). The top submarkets for net absorption during this period were Tempe, Ariz.; Lake Union (Seattle); South Valley (Salt Lake City); Downtown Nashville; and SOMA (San Francisco).

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