Canadas Emerging Tech Markets Attract Investors
Written By: Jim Adair
Monday, April 08, 2019
When CBRE >
However, Toronto is also a world leader in another category ntilde; the high cost of housing. The 14th Annual Demographia International Housing Affordability Survey placed Toronto in the ldquo;seve>
Some of the fastest-growing Canadian tech markets are Ottawa, Quebec City, Hamilton and Quebec City, where housing prices are much lower.
Ottawa ranked No. 2 in the CBRE study. The city ldquo;is shedding its government town image. It is home to 1,700 technology companies and employs over 70,000 tech talent employees,rdquo; says Shawn Hamilton, managing director of CBRE Ottawa. ldquo;In the last five years, urban tech has grown to be the second-largest user group in downtown Ottawa, bigger than the accounting and legal sectors combined.rdquo; Ottawarsquo;s benchmark house price in February was 400,800.
ldquo;High-quality and well-educated tech talent, cost efficiencies and welcoming immigration policies are competitive advantages for Canadian tech markets,rdquo; says Paul Morassutti, executive managing editor at CBRE Canada.
The study says that the strong U.S. dollar means companies can get high-quality tech talent at a >
ldquo;Taking both talent and real estate costs into consideration, the typicalrsquo; 500-person tech company needing 75,000 sq. ft. of office space can expect a total annual cost to range from US27.6 million in Montreal, the least expensive market overall, to US32.2 million in Ottawa, the most expensive Canadian market. In contrast, the cheapest U.S. market is Rochester, N.Y, which requires US36.3 million to run a similar operation,rdquo; says CBRE.
Recently Envoy Global >
The CBRE report says Ottawa leads North America with an 11.2 per cent concentration of tech workers, above the Canadian average of 5.3 per cent. ldquo;Waterloo Region and Quebec City also punch above their weight,rdquo; says the report. ldquo;While only comprising a combined 5.7 per cent of the Canadian tech landscape, these two cities have tech concentrations that are comparable to that of Toronto and Montreal, respectively.rdquo;
After Ottawa, CBRE ranked Montreal, Vancouver, Waterloo Region, Calgary and Halifax at numbers three to seven in the tech talent scores.
Quebec City, ranked eighth, has emerged as a leader in AI technology, thanks to Coveo, which has a large research and development team there. The cityrsquo;s primary tech industries are life sciences, optics and computer solutions. It is also home to Canadarsquo;s first technology park, which is home to about 100 businesses.
The average home price in Quebec City in February 2019 was 266,239. Hamilton, with a ninth-place ranking, received funding as part of the Autonomous Vehicle Innovation Network project. It also is home to the McMaster Innovation Park, which opened a 33-million biomedical research centre. More recently, McMasterrsquo;s tech start-up incubator received a grant of more than 1 million in federal government funding.
The benchmark price for Hamilton homes in February was 587,300, an increase of five per cent compared to last year.
A recent study by Victoriarsquo;s tech sector says it has a total economic impact of 5.22 billion and employs 16,775 people. The study says that before 2020, there will be more than 1,000 tech firms operating in the region, growing annual revenues to 10 billion. Software development, ocean science and advanced manufacturing are the major tech industries.
Victoriarsquo;s benchmark property sale price was 680,800 in February, a three-per-cent increase from last year.
ldquo;Canada may be in the tech spotlight, but that attention also reveals room for improvement,rdquo; says CBRE. ldquo;Tech talent markets can do more to grow the industry and attract investment from global tech giants. Quality of life, with an increasing focus on affordability, is an important differentiator.rdquo;
The report says Canadian cities should capitalize on their existing research institutions, access to capital and high living standards.
Cities must form tech ldquo;clustersrdquo; of small and large companies, working together with research institutions and among themselves, to develop a long-term competitive advantage, says CBRE.
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