SAN FRANCISCO— “Venture capital investment and demand for real estate are highly correlated.” So says JLL’s Amber Schiada, director of research for Northern California. “Especially since a lot of these startups are using capital funding to hire more talent,” she adds.
As startup-type firms grow, she explains, demand for real estate increases. “Roughly 260,000 square feet of current tenant requirements in Silicon Valley are software firms that received venture capital funds in Q1,” she says.
According to JLL research, the total high-tech venture capital funding during Q1 2014 was $1.4 billion, accounting for 30% of all VC-backed funding in Silicon Valley.
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