LinkedIn’s $30.4 million acquisition of its Carpinteria campus is the latest move by a major tech firm to strengthen its presence in the Tri-Counties.
The acquisition of the 6410 Via Real property includes around 87,000 square feet of office space on 15 acres. The purchase by LinkedIn, a fast-growing unit of Microsoft, followed other deals by technology tenants, including Goleta-based Yardi, to take ownership of their South Coast facilities.
“LinkedIn expects to be in Carpinteria for the long run,” Steve Breiner, senior director of real estate at LinkedIn, told the Business Times in an email. “It makes sense for us to be a long-term owner of this site.”
The deals are evidence that tech firms with an eye for growth are “getting in on the ground floor” of a growing tech hub, said Peter Rupert, executive director of the Economic Forecast Project at UC Santa Barbara. “Purchasing land here is part of a commitment to be around for a while,” Rupert said.
Low interest rates have encouraged the owner-user sales, Radius Commercial Real Estate said in its economic forecast Nov. 19. The “historically huge prices” tech firms have shelled out also indicate an appetite for “less risky” leased properties ahead of a potential economic downturn, even as vacant buildings have seen prices drop.
“Some of the investor purchases today may be viewed as hedges against a dramatic decline in the stock market,” Radius wrote in its third quarter report.
Research in quantum computing has encouraged Google to set up its own quantum computing facility in a location close to the UCSB campus.
Several hundred Amazon workers are poised to transform the 1000 block of State Street in downtown Santa Barbara when the Seattle-based tech firm opens an Alexa hub in a mixed-use facility in early 2020. Amazon and Amazon Web Services already have operations in San Luis Obispo.
Among tech firms based in the region, real estate software provider Yardi’s decision to purchase the property it had been leasing at 420 Fairview Ave. in Goleta for $22.8 million was the largest commercial sale of the second quarter, Radius said.
In a trend that’s being repeated on the Central Coast, rapid growth at software and medical technology firms have more than offset job losses as other industries downsized, said Joyce Donaldson, president and CEO of the Carpinteria Valley Chamber of Commerce.
With around 850 employees, privately-held construction software firm Procore dominates employment in the city; LinkedIn and medical device and materials manufacturers Agilent and NuSil also rank among the top five employers in Carpinteria, reporting around 300-400 employees apiece.
In conversations with the chamber, tech employers have noted Carpinteria’s proximity to educated workforces in both Santa Barbara and Ventura counties, as well as strong transportation infrastructure, Donaldson said.
Like other hubs of industry in the Bay Area and Santa Monica where these heavyweights have set up shop, the growth speaks to strong relationships between tech employers and universities, Rupert said.
While housing continues to be a barrier, the conversation is much broader than purely price, he added. Tech firms – and their employees – are willing to pay more for a location with good schools, safety and recreation, driving changes to downtowns like the Funk Zone as cities “grow toward the kinds of things the people who are going to work here want to do.”
By taking full ownership at the campus, LinkedIn hopes to build on partnerships it has established within the regional business community, said Public Sector Manager Joey Zumaya.
Working with organizations like the chamber and Women’s Economic Ventures, the company has been able to expand on the learning and development role it took on with the acquisition of Lynda.com in 2015.
Tutorial sessions on the platform and outreach to youth and underserved communities also builds on its core mission of “helping connect people with economic opportunity.”
“Being in this community is really special to us because we’ve been able to engage in different ways that map back to our culture and are important to us,” Zumaya said.
Since it entered the region, the company has steadily scouted for new talent to grow its headcount at the Carpinteria site, he said, but it does not have immediate hiring targets or plans to expand with the purchase of the property.
As it grows on the Central Coast, the company has kept diversity and inclusion top of mind, Zumaya added, with a goal to create an employee base that is “reflective of the users of the platform.”
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