The University District is being targeted as a tech hub financed in part by taxing property owners. But is that the best approach to use to build the next technohood?
Jim Stockdale doesn’t look like a startup financier.
But the 84-year-old retired pastor — and others in his University District condominium building — is being pushed into paying for an overhaul of the neighborhood aimed at luring more tech startups.
They’re part of a controversial effort by City Hall, the University of Washington and business interests to make over the funky area, build taller buildings and create Seattle’s next technohood.
Stockdale’s condo is among hundreds of properties in a proposed improvement district that would tax property owners to pay for economic-development efforts, cleanup, marketing and advocacy.
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There’s not much he can do to stop it. About 65 percent of property owners in the area have already said it’s OK, which is enough to get city approval.
The tally is a little sketchy, though, since the UW accounts for 50 percent of the support. Normally the school wouldn’t be counted because it’s tax exempt, but it decided to give the district $350,000 a year.
“The vote is not representative of this community,” Stockdale said. “It’s representative of the fact that they own a lot of property in it.”
Giving the old neighborhood a nudge isn’t a bad idea. If tech is going to continue growing at its current rate, this region needs more places for these companies to congregate. But there may be better options than heavy-handed city schemes.
During the current boom, tech companies have filled Pioneer Square, flowed into downtown office towers, spread east along Interstate 90 and flooded South Lake Union. They’ve taken over much of Fremont and are extending west toward Ballard and east toward the UW. They’ll reach the U District one way or another.
Still, it’s a little unseemly for Seattle’s movers and shakers to cut deals and tax retirees to boost this activity in a chosen neighborhood. It doesn’t have to do those things and will still thrive.
Next Silicon Valley
Other cities around the world are scheming like this in hopes of becoming the next Silicon Valley. From Singapore to Sarasota, you’ll find “tech innovation zones” being pushed by cities and well-connected developers — developers of real estate, not code.
Perhaps the next Microsoft or Amazon.com will be hatched in one of these sleek new office complexes, but I doubt it. You can’t really plan for such a lightning strike.
Microsoft started in a drab, one-story brick building in Albuquerque, N.M., and Amazon started in a Bellevue garage. Microsoft ended up in what was envisioned as a light industrial park. Amazon now fills an area developed to attract biotech companies.
Early-stage startups generally look for cheap space, perhaps with some character and proximity to other startups. Investors expect them to be thrifty and not splurge on offices in shimmering new towers, at least not until they really get rolling.
If you look around there are all sorts of cool older, cheaper buildings in nearby cities like Tacoma, Everett and Bremerton.
Longer-term, making those places part of the tech landscape may make more sense than stuffing as many offices and apartments as possible into a few groovy neighborhoods in Seattle.
Besides, today’s 20-something tech recruit may get married, have children and then want more than a tiny flat with no parking. Perhaps they’ll gravitate to companies like Google, Microsoft or F5 Networks, which offer some employees the choice of working in the city or at a suburban office. Or maybe they’ll look for a place to start their own company.
String around Puget Sound
Look at Silicon Valley. It began as a cluster of electronics companies at the south end of San Francisco Bay. But the term is now used to describe a string of tech-heavy cities around the bay, most of which are connected by fast trains.
There are hints that this could happen around the Puget Sound area, if Seattle doesn’t completely isolate itself with inane planning.
“You’re starting to see companies spreading out, south and north. You even have a couple over on the peninsula,” said Lars Harvey, chief executive of IID, an Internet security company in downtown Tacoma.
The company originally started in Silicon Valley in the 1990s. It moved to Tacoma 10 years ago, partly because a co-founder wanted to be closer to family in the area
Harvey said Tacoma offers a nice blend of being away from Seattle’s hustle and bustle “while still being able to attract excellent talent.” IID has also benefited from the UW’s Tacoma campus and its cybersecurity coursework.
Since the move, IID has grown to about 80 employees. Some were recruited from Silicon Valley, which is also where the company lined up its venture funding.
Still, Harvey said it can be challenging to hire people from Seattle who think “Tacoma seems far more than the 35 miles away that it is.” It’s also harder to participate in tech- networking activity and Tacoma doesn’t yet have the sort of “energy and exchange” that’s happening in Seattle.
Harvey said that if the rail system ever connects Tacoma to Everett in a way that’s usable every day, “you will see a lot more” tech activity in the smaller cities.
If Seattle really wants to nourish the long-term growth of tech around here, it could use some of its political weight to advance this notion of evolving into a bigger and interconnected tech region.
It can only go so far with local improvement districts ostensibly for startups, especially if they have to be funded by taxing retirees like Jim Stockdale.