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News release

SALT LAKE CITY, UT

Rising Rents and Industry Expansion Push Technology Firms To Key Growth Markets

JLL reveals 21 U.S. locations with ideal conditions for startups and tech sector


SALT LAKE CITY, Nov. 18, 2015 – Even though Northern California is the cradle for the technology industry, Silicon Valley has matured beyond the garages from which it was born. According to JLL’s 2015 United States Technology Office Outlook, technology firms and startups aren’t just exploring new U.S. markets, they’re starting to plant roots.

Over the past year, 73 percent of the sector’s office leases represented occupancy growth. With Northern California holding nine of the top 15 most expensive in-demand technology submarkets—led by Downtown Palo Alto at $98.68 per square foot—tech firms are looking to other zip codes to fuel their future. Expansion for the technology industry in 2015 is no longer just about the convenience of cheaper rents or accessing new talent pools. It’s a strategic necessity.

Not all locations are equal, however, particularly for young startups and small-to-mid sized technology firms. JLL evaluated the key factors, including market startup opportunity and cost, to develop a proprietary Locator Matrix to determine which locations currently offer the right fit for these companies. Enter: Utah. Salt Lake City soared ahead in this year’s list with a total weighted market score landing them in ninth (up from twentieth) behind major tech-hubs like San Francisco and New York City.

“The definition of opportunity or what determines a ‘sweet spot’ market is constantly evolving, and the time to capitalize on those opportunities isn’t infinite,” said Amber Schiada, Director of Research for the Rocky Mountain region and Northern California. “Startups are now competing with other industries for talent and creative space that will push rents at a faster rate over the next 12-18 months. That’s why we developed this matrix, so that these companies could quickly and easily examine a full range of factors when selecting their next location.”

Salt Lake City, with a market score of 77.3, is desirable for its deep, highly educated talent pool and proven track record with some of the Industry’s top players. Despite its strong reputation among tech firms, Salt Lake City rents and labor costs still remain relatively low, although that could be changing as vacancy rates continue to drop. Creative buildouts the tech industry craves are also seeing a market-wide shortage. Nevertheless, Salt Lake City is still a model market for other metro areas that want to draw tech companies to town.

About the Technology Office Outlook Report
The report helps technology companies make informed expansion decisions and provides insight for investors looking to find the next high-tech growth opportunity. JLL’s research ranks 37 U.S. markets by potential investment opportunity and by the best location for continued expansion with our proprietary Locator Matrix.

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About JLL
JLL (NYSE: JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. A Fortune 500 company with annual fee revenue of $4.7 billion and gross revenue of $5.4 billion, JLL has more than 230 corporate offices, operates in 80 countries and has a global workforce of approximately 58,000.  On behalf of its clients, the firm provides management and real estate outsourcing services for a property portfolio of 3.4 billion square feet, or 316 million square meters, and completed $118 billion in sales, acquisitions and finance transactions in 2014. Its investment management business, LaSalle Investment Management, has $57.2 billion of real estate assets under management. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit www.jll.com.