By Business Facilities Staff
From the July/August 2019 Issue
15th Annual Rankings: 2019 Metro Rankings Report
ATLANTA NO. 1 IN GROWTH POTENTIAL
We’ve subdivided our metro Economic Growth Potential ranking into small, medium and large categories this year. Atlanta, GA; San Antonio, TX and Phoenix, AZ are the top-ranked large metros in this flagship category, respectively.
Metro Atlanta, home to 15 Fortune 500 companies, has become a red-hot tech hub. With a diverse population and innovation-driving ecosystem, Atlanta offers a wide range of opportunities for technology companies looking to do business in the U.S.
The Atlanta MSA is the 10th-largest metro economy in the nation with a GDP of $385.5 billion. There are approximately 200,000 individuals employed in the tech sector in the Atlanta MSA—the sixth largest metro area in the nation for technology employment.
Metro Atlanta continues to attract technology companies looking for diversity of talent and background. BlackRock chose the region for its new Innovation Hub comprised of 1,000 jobs. Music-streaming service Pandora chose the region to expand its East Coast presence with 250 new jobs. Honeywell International Inc. is expanding their Midtown software innovation center for 300 more jobs, and Salesforce expanded its regional headquarters in Atlanta with 600 jobs. Companies continue to choose the region as a place to establish and grow headquarters operations—choosing to build a future in metro Atlanta.
Atlanta Tech Village unites established tech companies, startups, innovators and investors under one roof. More than 300 startups have passed through the Village, and more than $600 million has been raised in capital toward their innovations. The Advanced Technology Development Center (ATDC) is an incubator at the Georgia Institute of Technology, helping entrepreneurs around the region. ATDC companies have attracted $2.5 billion in investments and created 5,500 jobs.
Metro Atlanta unites its global brands and companies to the new ideas from local startups every day—creating the ideas that change the world.
Companies across the ecosystem are the standard bearers for some of the world’s most forward-thinking technologies in cybersecurity, digital media and IoT. The region also has been named a Brookings Institution “knowledge capital,” becoming known as the center for global health and health IT, and has been dubbed “transaction alley” for its FinTech volume, among other accolades. Plus, metro Atlanta is a digital supply chain leader as home to the world’s busiest and most efficient airport and a destination with an easily accessible port.
Metro Atlanta is an evolving landscape of opportunity and possibility supported by the region’s universities and colleges, including Georgia Tech, Emory University and the world’s largest consortium of historically black colleges and universities, the Atlanta University Center. Georgia Tech leads the nation in number of engineering bachelor’s degrees awarded, and the school awards more engineering bachelor’s degrees to African Americans and women than any other school in the country.
Georgia Tech’s support of the technology ecosystem in metro Atlanta extends to TechSquare ATL—a membership community home to more than 2,100 students; more than 100 startups; 21 corporate innovation centers; 10 research labs; and four startup accelerators.
GRAND RAPIDS, MI: MID-SIZED METRO WITH HEAVYWEIGHT POTENTIAL
Grand Rapids, MI, Madison, WI and Birmingham, AL are our top three mid-sized metros for Economic Growth Potential, respectively.
The Grand Rapids region is home to industry leaders in applied technology, sustainable practices and industrial design. The region has some of the nation’s largest industry concentrations in metals, plastics, biopharmaceuticals, medical devices, production technology, automotive, office furniture and food processing.
With approximately four out of five manufacturers having less than 250 employees, West Michigan manufacturers are lean, innovative and offer a wide variety of capabilities. Manufacturing currently accounts for 15 percent of all jobs in the region and remains the heart of West Michigan’s economy.
In 2009, manufacturing in West Michigan began an era of unprecedented job creation and investment, surpassing both state and national averages year after year. This trend continues today with more than 2,500 manufacturing companies growing in the region.
Recent manufacturing projects in the Grand Rapids region include a $10 million capital investment by Bissell Inc. that will create 100 new jobs, a $140 million capital investment by Dicastal North America that will create 300 new jobs and a $29 million capital investment from Plasan Carbon Composites expected to generate more than 600 new jobs.
West Michigan’s manufacturers are also supported by commercialization partners, including the Van Andel Institute, the Michigan Alternative and Renewable Energy Center (MAREC), the University Research Corridor and MSU Business Connect.
From full-service, large-scale managed IT solutions to custom software, online and app development, West Michigan’s high-tech industry can build solutions from the ground up. Whether it’s a pure digital solution or developing integrated technology products, the region’s tech companies have the knowledge and resources to make it happen. The region boasts a tech pipeline fueled by a network of 17 regional colleges and universities. The Grand Rapids region’s IT industry is one of the fastest growing in the nation, growing at a rate of 18.5 percent. Average earnings per job in West Michigan’s IT industry are $85,692.
AUSTIN, DENVER, NEW YORK CITY HAVE TOP STARTUP ECOSYSTEMS
There are tech hubs across the country, but what makes Austin different and desirable is a culture that fits seamlessly with tech. When a company joins Austin’s tech community, it enters a culture that is open, diverse and collaborative. It’s an environment where people are looking to enhance and augment ideas. If you do business in Austin, the tech community is going to help you achieve your dreams.
Austin is home to a creative and innovative ecosystem that has many different layers. There are entrepreneurs, startups, growing companies and tech giants like Google, Apple, Amazon, Oracle and Dell. The tech community in Texas’ capital city also is diversified across different sectors; it is home to not just software and IT but also tech innovation across a broad spectrum of industries. Austin hosts the Army Futures Command, cybersecurity firms, transportation technology, life sciences and health tech and companies innovating in film, gaming and music.
The Austin region also is able to benefit from the incredible work going on at Capital Factory, a “center of gravity for entrepreneurs” that houses startups focused on developing disruptive technology. Under Founder Josh Baer’s leadership, Capital Factory is able to be selective in its work while still managing to have thousands of members and more than 150 mentors call Capital Factory home, spurring innovation and dynamic breakthroughs.
Austin’s talent is famously “sticky.” Employees are able to find work environments they enjoy and contribute toward new technologies. These high-skilled workers move to the Austin region because of its affordable cost of living and vibrant culture that has an excellent life-work balance.
The entire Austin region has benefitted from a recent string of expansions and relocations. This is just a partial list of companies that have made announcements since 2018:
Apple (expansion, new campus and capacity for up to 15,000 jobs); Resideo (new headquarters and 120 jobs); U.S. Army Futures Command (new headquarters and 500 jobs); PIMCO (new company, 200 jobs); Zoho (new headquarters and 440 jobs); Amazon (expansion, 800 jobs); Google (expansion, 750 jobs); Insurance Zebra (expansion, 100 jobs); Oracle (expansion, new campus and 1,000 jobs); Stitch Fix (expansion, 50 jobs); GM Technology Hub (expansion, 500 jobs); Charles Schwab (new/expanded and 1,500 jobs); and Clear (new, 30 jobs).
New business facilities are being constructed across the Austin region from the Downtown Central Business District, to the Domain in the northwest and Austin’s second downtown, to Southeast Austin and East Austin—where older buildings are being renovated and made into hip tech centers—and Southwest Austin where companies like Yeti, Solar Winds and AMD have facilities. Just as Austin’s tech community is collaborative, its growth also is a collaborative and organized effort of more than 15 cities working hand-in-hand to bring prosperity and build diversity through the region.
Metro Denver describes itself as “a crucible for innovation and entrepreneurism.” Partnerships among the area’s research universities and national laboratories and the business community breeds company success. Metro Denver’s entrepreneurial business environment is propelling forward with dynamic industries, significant venture capital awards and high concentrations of scientific and research talent.
Key initiatives driving the entrepreneurial economy in Metro Denver and Northern Colorado include:
- The Blackstone Entrepreneurs Network (BEN) is an organization looking to advance Colorado startups. BEN’s mission is to provide Colorado’s most promising entrepreneurs and scale-up experts with the necessary resources and networks to reach their full potential.
- Galvanize offers co-working spaces designed to give entrepreneurs and innovators a community where they can spark ideas and build companies, through the three pillars of capital, community and curriculum.
- INDUSTRY Denver is a unique space that holds cornerstone tenants, a multitude of mid-sized users, dozens of sole proprietors and boutique firms that inspire and help each other.
- WeWork is a coworking space offering flexible month-to-month memberships. From furniture to conference room time, WeWork provides an innovative environment to do business. There are even rooms with Xbox consoles when a fun break is needed. With two locations in Denver (Union Station and in the Lower Highlands), WeWork has the capacity for up to 2,000 workers.
- TEDxMileHigh showcases innovative Coloradans, no matter the sector, who each give the ‘talk of their life’ around the power of ideas. This diverse group of thought leaders and innovators educate, inspire and stimulate change with the ultimate goal being deep discussion and action.
Former Gov. John Hickenlooper created the Colorado Innovation Network (COIN) in 2011 to promote collaboration among Colorado’s private, public and academic organizations. COIN works to stimulate economic growth, support innovative business activities and help create jobs and attract new businesses.
- National Oceanic and Atmospheric Administration (NOAA): the federal government’s top agency for monitoring our climate, the space environment and ocean resources (Boulder, CO)
- National Renewable Energy Laboratory (NREL): the nation’s primary laboratory for renewable energy and energy efficiency R&D (Golden, CO)
- National Institute of Standards and Technology (NIST), which promotes U.S. innovation and industrial competitiveness by advancing measurement science, standards and technology (Boulder, CO)
- University Corporation for Atmospheric Research (UCAR), dedicated to exploring and studying our atmosphere and its interaction with the sun, oceans, biosphere and society (Boulder, CO)
- National Center of Atmospheric Research (NCAR), managed by UCAR, is a National Science Foundation R&D Center (Boulder, CO)
- Cooperative Institute for Research in the Atmosphere (CIRA), which directs research in the atmospheric sciences into practical applications in weather and climate (Fort Collins, CO)
- Cooperative Institute for Research in Environmental Sciences (CIRES), dedicated to research targeted at all aspects of Earth System Science and communicating its findings to the global scientific community (Boulder, CO).
New York City’s tech ecosystem now has more than 9,000 startups. The startup ecosystem in the nation’s largest city is valued at an estimated $71 billion, leading the field in growth sectors, including life sciences and blockchain. NYC has more than 100 incubators providing fertile ground for startups to grow, including:
TechStars: startups get seed funding from over 75 different venture capital firms and angel investors who are vested in their success, along with three months of intensive top-notch mentorship, incredible perks and the chance to pitch to angel investors and venture capitalists at the end of the program. The companies average over $1M in outside venture capital raised after leaving TechStars.
NYU-Poly: NYU-Poly started BEST, its first business incubator, at its downtown Brooklyn campus in 2004. In 2009 they partnered with New York City to open a second incubator, Varick Street, in Manhattan as part of Mayor Bloomberg’s Five Borough Economic Opportunity Plan. In 2009 they also began NYC ACRE, the incubator focused on supporting the efforts of clean-technology-oriented companies.
FinTech Innovation Lab: An annual program run by the New York City Investment Fund and Accenture for early and growth companies that have developed cutting edge technology products targeted at financial services customers. Through a competitive process, the chief technology officers of the world’s leading financial service firms will determine which proposals are accepted for further development and deployment.
NYC has an estimated 200,000 businesses with 20 or fewer workers; Brooklyn has notched a startup growth rate of 356 percent since 2008.
According to city officials, average salaries for engineers in New York are the highest in the nation, and NYC has the fastest average time to hire engineers (24 days); average tech job wages in NYC are 49 percent higher than average NYC across-the-board private sector wages.
NYC also is an epicenter of venture capital (VC) funding for startups. City officials say NYC companies attracted 735 VC deals in 2018; they said New York has the second-highest number of early-stage investments in the world (Silicon Valley remains number one); more than 6,100 VC funding rounds have occurred in New York City since 2010.
NYC tech initiatives include: CS4All, an $81-million public-private partnership that supports computer science education; NYCx, said to be the first municipal program in the U.S. designed to transform urban spaces into hubs for tech collaboration; LinkNYC, creator of more than 1,300 communications kiosks around the city; and Winternship, a partnership between Cornell Tech and City University of New York to prepare women in high school and college for tech jobs.
MIDLAND, TX IS CRUSHING THE COMPETITION IN JOB CREATION
Midland County, TX is breaking records for job creation and overall growth, fueled by the oil and gas industry and accelerated by startups and supporting businesses. City leaders, business owners, executives and entrepreneurs are leveraging growth in the energy sector to diversify Midland’s economy and encourage new enterprises. These efforts are paying off as jobs are being created in construction, hospitality, transportation, retail and healthcare.
Employment in the West Texas county is surging by nearly 12 percent, more than seven times the national average (Roper, 2019). This growth is being fueled by the millions of barrels per day being extracted from the Permian Basin, the jobs this activity creates and the money being poured into Midland’s economy.
Midland’s efforts to expand its aerospace sector have generated recent success. AST&Science, after an intensive competitive process, recently announced the selection of Midland, TX as the location for its new high-volume North American satellite manufacturing plant and corporate headquarters.
The space technology company’s new 85,000-square-foot facility is located within the Space Port Business Park at the Midland International Air and Space Port, the first commercial airport to obtain a Space Port License from the Federal Aviation Administration. It will augment current R&D, engineering and manufacturing capabilities in Maryland and Europe operated by AST&Science and its subsidiary AST&Defense.
The new plant will be one of the largest “New Space” manufacturing facilities in the United States and will create more than 160 space manufacturing jobs in Midland, according to AST&Science chairman and CEO Abel Avellan, who said in a release that the company expects to invest over $30 million in the facility over the next several years and to achieve annual production capacity of 100,000 space modules, called Microns.
The new AST&Science plant will design, build, integrate, manage and launch satellite platforms into low Earth orbits (LEO) in a fully integrated aeronautical and space operation. Avellan noted that the collocation of the high-volume manufacturing and direct airside access for the horizontal launch capability, using carrier aircraft at the Midland Space Port, will be an important element in the company’s planned rapid LEO satellite deployments.
The company’s patented modular construction process will dramatically reduce the cost and weight of the LEO satellites, while providing unprecedented levels of power and performance.
“Our revolutionary technology will change the way satellites are manufactured, launched and used in space and on Earth. From Midland, we will scale up quickly to produce high quantities of low-cost, ultra-powerful LEO satellite platforms,” said Avellan, in the press release. “This will open up an astonishing range of commercial and defense applications not previously possible with traditional satellite manufacturing techniques.”
NEW HAVEN-MILFORD, CT MSA IS A MAGNET FOR MILLENNIALS
New Haven-Milford CT, Madison WI and Syracuse NY are the top-ranked metros, respectively, in our new Millennial Magnets ranking, which tracks the movement of individuals born between 1980 and 1998.
According to a recent study from the National Association of Realtors, an analysis of the U.S. Census Bureau’s 2017 American Community Survey, which tracks households in the nation’s 100 largest metro areas, found that the New Haven-Milford metropolitan area topped a list of areas to which millennials moved. Millennials represented 22 percent of the entire population in the New Haven-Milford area in 2017, according to the study. They represented 75 percent of the recent movers into the area from any age group.
Josh Geballe, CT’s state commissioner of Administrative Services, told the New Haven Register that the quality of public schools and the relatively low cost of living (compared to Boston, New York and other large cities), as well as a thriving startup ecosystem, are drawing millennials to the New Haven-Milford area. Before he joined the administration of Gov. Ned Lamont, Geballe created a biotech startup, Branford, CT-based Core Informatics.
In an interview with the Register, Geballe cited Branford—a town of less than 30,000 that is home to 20 biotech companies—as an example of the region’s appeal to millennials.
Employment opportunities and affordability are driving millennials to move to Madison, WI, according to a Bloomberg report. The state capital and university town had the lowest unemployment rate among the 100 largest metro areas, thanks in part to attracting millennials that command higher incomes than their generational peers, the Bloomberg report stated. Almost one-third of homes for sale are affordable to millennials who recently arrived, according to NAR’s report.
PHOENIX IS FASTEST-GROWING CITY
It’s not a coincidence that Phoenix—no. 3 in our metro Economic Growth Potential ranking—also is the Fastest-Growing City by population in our 2019 Metro Rankings Report.
“Demographics and economic growth go hand in hand,” BF Editor in Chief Jack Rogers said. “It’s hard to believe after what everyone went through in the Great Recession, but today the U.S. has a labor shortage. Increasingly, site selection decisions are factoring in population growth as a prerequisite, because businesses want to make certain that the locations they choose will have a robust available workforce for years to come.”
The Greater Phoenix region offers a skilled, diverse workforce that is continuously fueled by globally recognized universities and community colleges. These institutions prepare highly qualified graduates for in-demand disciplines within established and emerging industries.
Arizona State University, Maricopa Community Colleges, Grand Canyon University, Northern Arizona University and the University of Arizona are among the more than 40 universities and other institutions of higher learning that prepare the region’s workforce.
Greater Phoenix has an extremely competitive workforce in regards to training, quality and availability of workers while maintaining one of the lowest costs for labor in the nation. Projected employment growth in the next decade is 10 percent, compared to the national average of 6 percent. With a median age of 36, the region’s population is one of the youngest in the nation.
It’s also not a coincidence that a metro with a younger demographic has established a thriving startup ecosystem. The Greater Phoenix Economic Council (GPEC) recently was awarded a $750,000 grant from the U.S. Department of Commerce under the Economic Development Administration’s 2018 Regional Innovation Strategies program competition to accelerate wearable and medical technology entrepreneurship in Greater Phoenix. The grant is expected to help 45 ventures and create more than 220 jobs throughout the three-year program.
The grant deliverables will be led by GPEC, the Center for Entrepreneurial Innovation (CEI) at Maricopa County Community College District, Arizona State University (ASU), the Partnership for Economic Innovation (PEI) and StartupAZ Foundation. The partners will promote and assist the translation of research for commercial applications, formation of new ventures and acceleration of startup growth by providing market validation services and mentor networks in the wearable and medical technology cluster.
“We’re here to help entrepreneurs develop better products, faster,” says Chris Camacho, president and CEO of the Greater Phoenix Economic Council. “We have an emerging technology ecosystem here that is increasingly recognized for introducing exciting new solutions to the market and this funding will allow us to better leverage our regional assets to help companies validate their products and position our region as a center of innovation excellence.”
The healthcare sector is intricate and complex to navigate as a startup company. By achieving the project goals, the region will establish a strong network within the innovation ecosystem and increase access to resources for entrepreneurs, healthcare firms and research organizations. Each partner organization involved in the proposal will have a strategic role to play in the success of the program.
“This new federal award provides a great opportunity to strategically expand the scope, scale and reach of our MedTech Ventures Program launched this year with regional Maricopa County IDA funding,” says Gregory Raupp, foundation professor, Ira A. Fulton Schools of Engineering, Arizona State University. “I have no doubt we will not only realize tremendous synergy with WearTech, but also strengthen and grow our working partnership with GPEC, CEI and PEI.”
The fastest-growing mid-sized metro also is in Arizona. Buckeye, AZ was the only Arizona city to repeat in the U.S. Census Bureau’s top 15 for fastest-growing mid-sized metros, moving up to the top slot from no. 5 last year. From July 1, 2017 to July 1, 2018, Buckeye saw an 8.5 percent increase in population, reaching 74,370. City officials estimate the current population at about 82,600.
With a planning area of over 640 square miles, Buckeye is only five percent built out today.
“Buckeye provides our residents an excellent quality of life,” said Buckeye Mayor Jackie Meck. “We offer good housing values while also staying focused on ensuring we remain a desirable community for years to come.”
In 2018, approximately 2,200 single-family residential permits were issued in Buckeye. So far in 2019, permits are exceeding that by eight percent, with the city projecting it will issue about 2,400 permits this year.
NORTHERN VA IS DATA CENTRAL
Northern Virginia continues its reign as the nation’s leading data center hub, followed in the top five by Phoenix, Dallas-Fort Worth, Chicago and the Las Vegas/Reno region, based on net absorption of megawatts.
Virginia boasts the largest data center market in the U.S. The Northern Virginia region has been home to the world’s leading data processing and storage companies since the early days of the internet. Virginia’s assets and infrastructure continue to set the foundation for success for leading technology firms.
Virginia’s density of fiber, substantial existing industry, reliable and competitively priced power, strategic location and low risk for natural disasters are a sample of the reasons it is the leading national location for the data center market. Virginia’s corporate roster includes leaders of the data center industry and cloud computing. Companies like Amazon Web Services, COPT, CyrusOne, Digital Realty, Equinix, Google, Facebook, Iron Mountain, Microsoft, OVH, QTS and RagingWire all operate data centers in Virginia.
Northern Virginia is the largest market for data center space in the U.S., home to over 12 million square feet of commissioned data center space, representing over 800 megawatts of commissioned power. Much of the industry’s presence is concentrated in Loudoun County, known as “Data Center Alley”, and it is estimated that up to 70 percent of the world’s internet traffic flows through Loudoun’s data centers each day. Increasingly, many areas throughout the Commonwealth are seeing major data center investment.
Virginia’s data center dominance begins with access to the federal government and traces its roots to the U.S. government’s experiments in wide-area fiber optic networking in the 1960s. In the 1990s, MAE-East was established in the area, with AOL building early fiber and power infrastructure. Equinix followed with its first data center in 1998, allowing companies carrier-neutral access to the internet. From these beginnings, the Northern Virginia region has grown to offer the highest density of dark fiber in the world.
In addition to Northern Virginia, advanced levels of connectivity are seen throughout the Commonwealth, drawing major projects to all parts of the state. Mid-Atlantic Broadband Communities Corporation owns and operates 1,800 miles of open-access fiber optic network in 31 counties in Southern Virginia, and operates a long-haul fiber network for optical transport to key peering hubs on the East Coast.