For startup companies looking to grow and thrive, there are a handful of cities that provide just the right environment, one that’s technology-friendly but also provides a vibrant urban experience.
According to real estate firm Savills; Austin, San Francisco and Tel Aviv top the list of great cities for tech companies, “proving that small cities are big hitters on the global stage,” according to the report released Wednesday.
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Rounding up the top five list are New York City and Stockholm; next on the list are London, Singapore, Dublin, Berlin, Hong Kong, Seoul and Mumbai.
The Savills Tech Cities Report aims to understand the many diverse drivers that make good cities for the tech sector. The firm has identified the 12 global centers at the forefront of tech by determining that they “all have thriving and growing tech industries, and are at the top of global shopping lists for tech companies looking for space in which to locate,” Savills researchers said in a statement.
Human capital is key
Savills considers access to human capital a key driver in locating tech firms. “Vibrant cities are where the talent wants to live and work,” according to the firm. Other factors in the report include access to venture capital and housing quality.
The firm also found that while the large global centers come up strong for business environment – New York, Singapore and London lead mainly thanks to their good regulatory environment – Asian centers dominate when looking at the tech environment.
It is interesting to note that smaller cities such as Austin, Dublin and Berlin rank highest in providing affordable accommodation, a lesser level of pollution and access to restaurants. In fact, smaller cities give residents shorter commute times (the average commute for tech cities’ employees is 31 minutes), accessibly by bike, and a better work/life balance.
Rent is cheaper in Mumbai
Combining office and residential costs, Savills found Mumbai to be the most affordable at $18.6 per square foot, while office rents in Singapore, London and Hong Kong sore above $85 per square foot.
“In today’s world, it is fundamental that companies look closely at how they retain their existing talent pool, attract new talent and keep themselves ahead, in what is an increasingly competitive employment market,” Jon Hutt, head of corporate real estate at Savills UK, said in a statement. “The nature of their space, the areas in which they locate, the quality of life that they can offer their teams and the access they have to talent, as they grow, significantly outweigh saving a few dollars on rent. This applies to all companies but for the tech community in particular it is crucial.”