Seattle Week in Review: Amazon Building Boom
Can we go back to Sunday and just watch Game 7 of the NBA Finals over and over again? This was a long, news-filled week capped by Britain’s vote to exit the E.U., which changes everything—right? We’ll be thinking about what it means for Seattle tech in the days and weeks ahead.
Meanwhile, Seattle booms. Downtown building projects are at a record high. But fewer Bay Area transplants are shopping for homes here, according to Redfin. Other news we’re tracking: Twilio’s IPO; a Series B for Outreach; and news from space and the world of Docker. Read on for details.
—Seattle’s skyline is bristling with tower cranes, with 65 building projects under construction in the downtown core, more than at any time since the Downtown Seattle Association (DSA) began tracking activity in 2005 (PDF). Forty-three of the buildings are residential, and the DSA says some 8,661 new residential units are slated for completion by 2017. Rental rates in the city continue to climb; perhaps this influx of new housing will help—though downtown high-rises aren’t exactly synonymous with affordable.
Some 5.7 million square feet of new office space is under construction—down from 7 million square feet at this time last year. Of that 5.7 million, 2 million is for Amazon. The Internet and retail giant now occupies more than 8 million square feet in Seattle’s downtown—mainly the South Lake Union and Denny Triangle neighborhoods—and is on its way to more than 12 million square feet, according to the DSA. That includes the company’s “biospheres,” now taking shape (pictured at top).
—Meanwhile, fewer Bay Area home shoppers are looking to relocate to Seattle, according to Redfin. The Seattle-based tech-focused real estate agency finds that only 2.8 percent of its Bay Area home-buying clients sought homes in Seattle during the first quarter of this year, compared with 5.1 percent for the first three months of 2015.
Redfin data scientist Taylor Marr does a great job breaking down the underlying causes of the Bay Area-to-Seattle (and elsewhere) migration—sky-high housing costs—as well as the reception that high-salaried tech workers are receiving in Seattle, where the disparity between the highest and lowest earners is growing. The city is grappling with issues of housing affordability and homelessness.
“New homes are being built in Seattle to accommodate some of this growth, but the majority are higher-end homes at expensive price points,” Marr writes. “This has been a trend for years now. In 2010, the average new construction condo cost 50 percent more than the average existing ones. In 2015, new condos cost more than twice as much as existing condos.”
Bay Area residents are still looking to flee to other tech hubs around the country. Redfin tracked an uptick in home searches in Washington, DC, Austin, Denver, and Boston.
—Twilio, the communications software company with some Seattle history, went public and had a strong debut Thursday. The $150 million IPO, one of only a handful in tech this year, was closely watched by a tech sector wondering about exits for investors in unicorns.
In Seattle, meanwhile, we await the next move of Impinj, which filed to go public earlier this month.
—Outreach, a Seattle startup building software to help sales teams collaborate more efficiently, raised a $17.5 million Series B funding round led by Trinity Ventures with participation from Microsoft Ventures, newly focused on early stage investments. The company, led by co-founder and CEO Manuel Medina, raised a $9.2 million Series A last fall, and a $2.4 million seed round.
—Seattle played host to two interesting tech industry conferences this week. DockerCon, for aficionados of technology allowing app virtualization and microservices, welcomed more than 4,000 attendees.
The NewSpace conference, meanwhile, marked the Seattle commercial space industry’s emergence, garnering lots of local media coverage and giving Seattle space entrepreneurs the chance to showcase their efforts to the broader industry.
Among the newsmakers was Jason Andrews, whose company, Spaceflight Industries, raised $18 million and acquired OpenWhere, before launching its latest satellite rideshare mission aboard an Indian Polar Satellite Launch Vehicle.
—In other acquisition news, EnerG2 is being snapped up by its partner BASF, the German materials giant. EnerG2 co-founder and CEO Rick Luebbe tells Xconomy: “It is the intention of BASF to continue operations of EnerG2, to grow the business and to keep the know-how and spirit of the company. No job cuts, in fact new job creation is anticipated.”
—Finally, some commentary from Mars, probably on the Brexit vote:
REMINDER: Fleeing to Mars is not an option. You will die here. Stay put and fix your dumb planet. Do not come to Mars.
— SarcasticRover (@SarcasticRover) June 24, 2016