Hartford Business Journal

8 Hartford Business Journal • May 4, 2015 www.HartfordBusiness.com Tech sector drives commercial realty activity By Chris Dehnel Special to the Hartford Business Journal G reater Hartford has cracked the top 50 in a national ranking of cities with top tech talent, but don't expect the region to become another Silicon Val- ley, or supersede New York and Boston as a haven for technology companies. The rankings, compiled by commercial realty broker CBRE Group, are based on sta- tistics from the fourth quarter of 2014 and are designed to identify the largest pool of technology workers and com- panies, which CBRE says are a "growing driver" of office space demand regionally and across the country. Silicon Valley, Washington, D.C., and San Francisco took the top three rankings. Greater Hartford came in at No. 41 ahead of Omaha, Neb., Indianapolis, Ind., Richmond, Va., and Nashville, Tenn. Michael Puzzo, first vice president and partner in CBRE/ New England's Hartford office, said over a two-year period the "high-tech industry" has not only spurred the economy as a whole, but has been a driver of commercial office activity, influencing rents and vacancy rates. "For the past two years, the Hartford market has witnessed growth from a number of niche players in the tech sector," Puzzo said. CBRE's rankings examined 13 different metrics for tech talent markets and assigned a weight to each based on their relative importance. For example, tech talent labor costs were weighted more heavily than office rents. The ranking's overall goal was to link the growth of the technology sector as a key driver in commercial realty activity. In fact, the high-tech industry accounted for more major U.S. office leasing activity than any sector in 2013 (13.6 percent) and 2014 (19 percent), CBRE said. Breaking down the numbers Greater Hartford's tech talent base consists of 23,568 workers, up 9 percent from 2010 to 2013, who make an average salary of $85,385, according to the report. They're employed in positions ranging from software developers/designers and technology engineers and computer and information systems managers. Hartford region tech firms such as finalsite, Evariant, Catamaran and Payveris have started to expand during the past 24 months, but growth is also coming from large employers like Travelers and United Technologies Corp., which have their own high-tech employment base. Last year, for example, the region's largest tech deals were UTC's leases of 74,000 square feet at 755 Main St. in Hartford and 66,000 square feet at 9 Farm Springs Road, in Farmington, the report said. A third major deal involved PCC Technology Group, which leased 16,000 square feet at 100 Northfield Drive in Windsor. Meantime, Kaplan Computers is in the process of expanding from its base in Manchester to Vernon, where owner Ken Kaplan has acquired a once dilapidated old Victorian era mill and is refurbishing it for his business. Moving forward, there is hope that UConn can expand the state's technology base as it makes a major investment in science, technology, engineering, and math faculty and curricula. UConn also recently broke ground in Storrs on the first building of its Technology Park, which will eventually house collaborations with major companies like Pratt & Whitney, Northeast Utili- ties and General Electric, among others. Tech not Hartford's super sector Hartford realty broker Chris Ostop said while the rankings are interesting, he would not call Greater Hartford a specialty technology market. The term tech- nology, he said, has a loose definition and Hartford's commercial realty scene relies on a broad range of industries. "It's a unique market with major insurance companies and major aerospace companies and a lot of other stuff," Ostop said. The CBRE report ranked Greater Hartford in various categories. One of the region's weak spots was costs. Hartford, for example, is at 108 percent of the national average cost of living and 102 percent of the average nation- al business cost. Hartford's average residential monthly rent of $1,259 puts it in the top 20 most expensive regions. One advantage Hartford has is more affordable office rents, especially compared to nearby cities that are a major draw to technology companies. With an annual gross asking rent of $19.73 per square feet, Greater Hartford office rents are a bargain com- pared to Manhattan ($67.05) and Boston ($33.78). Three other major characteristics of solid tech tal- ent markets include gender diversity, education and the presence of Millennials, Puzzo said. The ability to attract younger workers is a key attraction to tech companies. From 2009-2013 the Hartford region grew its Millennial population by 1,600 people, or 6.9 percent. By comparison, Washington D.C. experienced the big- gest Millennial population gain of 26.5 percent; the U.S. average was 3 percent growth. Meantime, 23 percent of Greater Hartford's tech workers are female; nationally 23.8 percent of technol- ogy jobs are filled by women. n FOCUS COMMERCIAL REAL ESTATE Q&A Boomers tastes' give retirement communities fresh look Q&A discusses how the coming "Silver Tsunami" of Baby Boom- ers is impacing senior housing/ retirement communities with Amenta Emma architect Myles R. Brown and Duncaster Retire- ment Community executive Carol Ann McCormick, who are working together on the expansion of Dun- caster Retirement Community in Bloomfield. Q: How are Baby Boom- ers changing the face of retirement communities? Brown: Due to its size, the Baby Boomer generation has always had a major impact on our society and the built environ- ment. In the '50s, this generation changed the face of housing with the growth of the suburbs and houses built with informal "family rooms," open floor plans, and large backyards. Now that this huge population is facing retirement, downsizing, and look - ing for senior-living options, there isn't enough supply to meet the demand, especial- ly for the type of prod- uct they will seek. McCormick: Baby Boomers expect to have what they have in their current homes. They are looking for warm, spacious, light-filled homes that feel connected to the outdoors, along with upscale finishes and amenities such as hardwood floors, stone countertops, and high-end appli- ances and fixtures. Q: What implications does this trend have for architects, designers and developers? Brown: Much of the exist- ing stock of senior-living housing needs a facelift. There's a lot of tired product with dated interior finishes and floor plans that don't serve today's lifestyle. Retirement communities that don't do these kinds of renovations will be passed over by Boomers. McCormick: They also want the provisions for aging in place that their current houses do not have such as accessibil- ity clearances in bathrooms and kitchens, fixtures and counter tops; controls that are set at appropriate heights and the abil- ity to easily add future grab bars for stability in the bathroom. Q: What is the current demand for retirement com- munities compared to other housing sectors (single-family homes, apartments, condos)? Where do you see retirement community demand going in the next 5-10 years? Brown: There's been a recent boom in multi-family rental hous- ing, but not for condos. Clearly, we expect community demand for retirement living options to go up sharply in the next 10 to 15 years. Right now, there are 40 million people over the age of 65. They make up 13 percent of the popula- tion. But, by 2030, all of the Boomers will be past age 65 and they'll make up 20 percent of the population. Q: Your firm recently was involved in the design of the Dun- caster Retirement Community apart- ment homes in Bloomfield. How was the design of that project dif- ferent from retire- ment housing you've worked on in the past? Brown: At Dun- caster and for all of the retirement communities we develop, we take the approach that all residential design should be ageless. Why not design a home where we all want to live both now and later? In order to be successful, today's senior communities need to feature what we all want in our lives. When you look at older com- munities, you find apartments with small disconnected dark spaces, sterile dated finishes, and an over- all design that is not well-suited for today's lifestyle. In the past, it seems like many architects and designers approached senior-hous- ing design as more institutional/ less residential, and the results were homes that current and future generations don't relate to. We worked in close collaboration with Duncaster to make sure their new apartment homes took a much MYLES R. BROWN Architect, Amenta Emma CAROL ANN MCCORMICK Executive, Duncaster Retirement Community Continued I L L U S T R A T I O N | J E S U S S A N Z , S H U T T E R S T O C K . C O M

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