Could downtown Phoenix be the next major hub for high-tech companies?
PHOENIX — There is a significant rise in the number of high-tech companies setting up shop in downtown Phoenix.
Shannon Selby, the economic development program manager for the City of Phoenix, said the number of high-tech companies in the area has increased from 67 to 281 over the last five years, a growth of more than 300 percent.
“It’s fantastic for Phoenix, because we have a growing economy with job growth and significant capital investment,” Selby said. “We just keep thinking it’s going to continue because of the momentum that we have.”
She said many of the high-tech companies moving to downtown Phoenix are from California. She said the lower cost of doing business in Phoenix are among the reasons why the companies are making the move.
Uber, Upgrade Inc. and Orb Health are among the latest tech companies to open offices in downtown Phoenix.
Ryan Bartos, executive vice present at Jones Lang Lasalle, said he advises high-tech companies and high-growth startups to open offices in the Valley. He said downtown Tempe, Old Town Scottsdale and downtown Phoenix are the three core tech markets in Arizona.
“Over the last 12 months, there’s been a substantial shift where I would say that downtown Phoenix right now is getting more inquiries and interest from the tech companies than any other market,” Bartos said.
He said there are several reasons why companies tell him they are moving to downtown Phoenix. That includes downtown Phoenix’s central location and a “great labor base” that’s “well-educated.” Bartos noted there are tens of thousands of students graduating from the three state universities and Grand Canyon University each year.
Another reason is the cost of living, which Bartos said is “extremely affordable” compared with other places, such as San Francisco and New York.
Bartos said the growth in tech companies is a testament Phoenix’s growing tech market, which he said will likely continue to grow.
“Tech companies tend to locate where other tech companies locate, and it kind of builds momentum,” he said. “That’s really where downtown Phoenix is right now.”