News

October 17, 2011

Taking Tech To Urban Centers

By: Chris Churchill, Staff Writer

Source: Times Union

The Capital Region is in the midst of a startling high-technology expansion that's changing much about how and where the area works.

But by and large, high-tech job growth -- and related population boosts -- are phenomena happening outside the region's traditional urban cores.

The massive GlobalFoundries computer-chip plant, for example, will employ 1,400 people in a building rising in Malta, some 30 miles from downtown Albany. And the ever-expanding College of Nanoscale Science and Engineering campus at the University at Albany is growing at the city's western edge, near swirling highway ramps that provide a quick exit from urban life.

For Albany, Troy, Schenectady and other cities in the region, the tech boom provides an opportunity -- but also a challenge.

Will they snare a greater share of tech job growth, particularly in center city or industrial areas? Can they capture new arrivals coming to the region to work at those jobs?

And can they take steps to ensure that the tech transformation revitalizes neighborhoods and districts that have suffered from long-standing patterns of decay?

The answers to those questions may shape the economic destiny of the entire region.

"For the tech boom to continue in this area, you have to have interesting and eclectic cities," said Ray Gillen, chairman of the Schenectady Metroplex Development Authority, an economic development agency. "Because that's where many tech workers want to live."

The region's cities face seemingly intractable challenges, including higher-than-average property taxes and lower-performing schools, that discourage some potential residents.

Likewise, the heads of some tech companies are going to look to establish their firms in locations in which costs are lower and parking is plentiful.

The suburban location of many of the region's tech centers -- including the Rensselaer Technology Park in North Greenbush or the emerging Vista Technology Campus in Slingerlands -- enhances that trend.

But some tech businesses seek out urban locations.

"If you look at the bigger picture," said Tobi Saulnier, head of First Playable Productions in Troy, "being downtown will have a payback that's not really measured in profit, but is measured in quality of community."

First Playable is a gaming company founded at a business incubator at Rensselaer Polytechnic Institute. Eventually, the firm migrated down the hill from campus to space in downtown Troy.

Saulnier concedes that the center city location comes with added costs and hassles, like parking. Yet it's also a recruitment tool, appealing to potential employees who value the ability to walk to work but may want to avoid big-city cost and congestion.

"We recruit people in cities like San Francisco and Boston, so we're recruiting against some pretty impressive metropolitan areas," Saulnier said. "But a village city like Troy has fantastic architecture and accessibility that competes well against those cities."

Those who have studied successful development trends say cities can encourage tech leaders like Saulnier to go urban by creating districts in which entrepreneurial energy is encouraged, along with the easy transformation and development of property.

"The city ought to be the easiest place to develop, not the hardest," said Ed McMahon, a fellow at the Urban Land Institute in Washington, D.C.

Bruce Katz, founding director of the Metropolitan Policy Program at the Brookings Institute, suggests the creation of so-called "innovation districts" with a mix of housing, restaurants and retail, and, of course, corporate tech space.

Boston has done just that -- with remarkable success. The city, eager to lure tech firms from nearby Cambridge or the suburban Route 128 loop, devoted 1,000 acres of industrial waterfront land to the creation of a district where tech firms and creative industries could cluster.

The district, created in 2010, has lured a diverse range of companies, including Vertex Pharmaceuticals, the Boston Herald newspaper and Brightcove, which offers an online video platform.

Laura Schultz enjoys where she lives.

The 34-year-old in 2007 moved to the Capital Region from suburban Washington, D.C., to take a job at the NanoCollege. She wanted a location near restaurants and services, and found it in an Albany house that's just off Western Avenue.

What's better, Schultz can walk or ride her bike to work.

"It's everything I could possibly need," she said.

Schultz said Albany should do a better job of marketing its quality of life to attract more newcomers like her. Others say the development of different living options, including downtown housing, will also help.

That's already happening in Albany with projects like 17 Chapel St., a condo development, or other downtown housing projects. It's happening, too, in smaller cities, like Cohoes, that are closer to GlobalFoundries.

Christopher Cirillo, vice president at The Richman Group, a Connecticut developer, said the region's growing high-tech profile played a role in his company's decision to partner on a 104-unit apartment project planned for downtown Troy, at the old City Hall site.

"The people who are going to be working in those jobs are going to need housing options," Cirillo said.

Albany and Troy may face a scenario in which a rising tide of downtown residents travel each day to suburban tech jobs -- a reversal, of course, of traditional commuting patterns.

"A lot of the people who are coming to this area are used to dense living," said Mike Yevoli, commissioner of planning and economic development in Albany. "Some of our suburban environments aren't going to be as appealing to them."

In Albany, the NanoCollege is now building a $300 million complex that will house researchers from tech companies such as Intel, IBM and Samsung.

The complex is only a five-mile trip from downtown Albany. Nevertheless, Katz, from Brookings, said UAlbany's location away from the downtown core and residential portions of the city has likely muted the potential for economic ripples or the development of lively urban neighborhoods.

If you want to get this full synergistic effect, and if you want to create districts with spinoff and entrepreneurial growth that spills into retail and restaurants, then location really matters," he said.

Steve Janack, spokesman for the NanoCollege, said the institution is working with Albany officials to find a home for a tech incubator that would help the city capitalize on nano-related research and growth.

"Those are active discussions," Janack said.

In Schenectady County, tech growth is mostly occurring at the General Electric Co.'s downtown campus -- and that's to the benefit of city's downtown.

Moreover, the city is primed to enhance the connection between GE and downtown with a $14 million makeover of Erie Boulevard that's slated to begin next year.