Tuesday, October 16, 2012

Bernanke Money Printing Hits Silicon Beach

Real estate prices are so hot in Silicon Valley that many start-ups are headed to Silicon Beach, where things are a bit cooler.

Bloomberg reports:
Office space is getting more expensive in Venice [California], part of a 3-mile (5-kilometer) stretch of oceanfront communities known as Silicon Beach because of its popularity with technology companies. Rents are climbing faster than in the wider Los Angeles region as startups pour into the area and compete for a tightening supply of real estate. The surge in demand is attracting developers, who are renovating old and abandoned buildings in hopes of appealing to more and larger companies...
“Whether it’s Silicon Alley in New York, Silicon Hills in Austin, Silicon Beach in L.A. or Silicon Valley in the Bay area, it’s the tech sector that’s driving office demand,” said John Sikaitis, a Washington-based senior vice president at Jones Lang. “In most of these areas, the office market is completely robust and often far ahead of the rest of the recovery of the larger region.”...
While Silicon Beach is much smaller than technology communities in Silicon Valley and San Francisco, the area is home to a rising number of Los Angeles’s more than 600 tech startups, according to a map by Represent LA, a website that promotes the companies.
StackSocial, which raised $800,000 from March to May from venture capitalists including Tim Draper and Paige Craig, competed with at least a half-dozen other small companies for its space, said Payne, 32.
Zambezi, an advertising agency that developed campaigns for such companies as Coca-Cola Co. (KO) and Comcast Corp., chose Venice because of its concentration of startups, access to entertainment-industry collaborators and the outdoor lifestyle, said Chris Raih, a co-founder of the six-year-old company.
Morning Surfers
“We oftentimes run, literally and figuratively, into other talented people” in the neighborhood’s hip stores and coffee shops, said Raih, 35. “That’s inspiring and a great chance to consult, formally or informally. And the beach is an inspiration. We have many employees who surf in the morning.”
Goota love it, surf in the morning, launch a start-up with Ben Bernanke newly printed money in the afternoon.

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