Reuters

San Francisco stacks up well these days compared with Silicon Valley.

With the exception of Manhattan, San Francisco may well be America's most expensive city. But when it comes to high-tech industry, the City by the Bay now actually has a cost advantage over nearby Silicon Valley. 

Take the recent news that social media start-up Pinterest is hoping to move to San Francisco. As Om Malick writes at GigaOM:

[O]ffice space is to be had in San Francisco for about $3.55 per square foot per month versus $5.78 per square foot per month in downtown Palo Alto or $4.81 per square foot per month in the Palo Alto-Stanford Park area. Menlo Park rents are running at $5.21 per square foot per month.

No surprise that Pinterest is now looking to move to San Francisco. Friends in the real estate market say that it has been toying with the idea of taking over the spot previously occupied by Digg. The rising office rents are only part of the story for startups. The tech boom is boosting demand for housing for tech workers and that is causing civic discord.

Malick points to this infographic by Justin Bedecarre of the real estate company Cushman & Wakefield, which compares the locational advantages of Silicon Valley and San Francisco.

Click on the infographic for a larger image

In addition to its possible cost advantage in office space, San Francisco also offers the walkability, transit access, vibrancy, and urbanity that are attractive to a growing number of tech professionals.

As The New York Times reported earlier this month:

Even more than the dot-com bubble of the 1990s, this boom could transform the fabric of the city.

This time, Twitter, Zynga, Yelp and other social network companies favored by venture capitalists have made San Francisco their home, creating jobs and raising commercial rents. At the same time, a growing number of young Silicon Valley workers, drawn by San Francisco’s urban charms, are also moving into the city as commuters and further raising rents.

In a city often regarded as unfriendly to business, Mayor Edwin M. Lee, elected last year with the tech industry’s strong backing, has aggressively courted start-ups. 

 

Silicon Valley has, for years, tried to recreate the vibrancy of a dense city in its office parks. Now more and more tech companies are looking for the real thing. Any cost advantage will only help accelerate this process.

Photo: Reuters/Robert Galbraith

About the Author

Most Popular

  1. Environment

    No, Puerto Rico’s New Climate-Change Law Is Not a ‘Green New Deal’

    Puerto Rico just adopted legislation that commits it to generating all its power from renewable sources. Here’s what separates that from what’s going on in D.C.

  2. a photo of Northern Virginia's Crystal City.
    Life

    When Your Neighborhood Gets a Corporate Rebrand

    From National Landing to SoHa, neighborhoods often find themselves renamed by forces outside the community, from big companies to real estate firms.

  3. Life

    Who’s Really Buying Property in San Francisco?

    A lot of software developers, according to an unprecedented new analysis.

  4. Equity

    What the Supreme Court Said About the 2020 Census Citizenship Question

    In oral arguments, conservative justices asked about data science, while liberals asked what the citizenship question was really for.

  5. Equity

    The Hidden Horror of Hudson Yards Is How It Was Financed

    Manhattan’s new luxury mega-project was partially bankrolled by an investor visa program called EB-5, which was meant to help poverty-stricken areas.