NEW YORK CITY—As the office sector's recovery becomesbroader-based, some markets nonetheless are pulling ahead of therest. Those markets, says a report from SavillsStudley, fall into two camps: those that offer the mostspecialized talent and those that provide substantially lower costsof doing business. “In many ways, this is a re-emergence of afamiliar pattern, the segregation of site selection intoknowledge/talent centers and lower-cost back office operations,”the report says.

The clear winners are neighborhoods such as SOMA in SanFrancisco and Silicon Alley in Manhattan, which have an edge inattracting millennials to urban cores. However, Savills Studleysays the suburban corporate campus is “far from dead.” Consider theexample of Google: while it has a significantpresence in Silicon Alley through its ownership of 111 Eighth Ave.,“the mothership is still in Mountain View, CA.”

Many suburban locations have been pursuing high-densitydevelopment strategies as they compete for employers, developmentprojects and residents, and Savills Studley notes that there havebeen success stories. “Top employers such as StateFarm, ExxonMobil and CharlesSchwab are anchoring the next set of 'urban suburbs,' ”according to the firm's third-quarter national office marketreport. “They are signing massive build-to-suits in mixed-usecomplexes with extensive new residential and retail product” inareas such as Atlanta's Central Perimeter, the Woodlands inHouston, the Dallas/Fort Worth suburbs in North Texas andBroomfield in Suburban Denver.