How the Tech Boom Will Impact NYC Real Estate

Silicon Valley is not a term that is often heard these days. The moniker derived from the Californian tech mecca that was Silicon Valley, and it referred to a specific region in Manhattan where a cluster of tech companies formed in the mid-1990s during the dot-com boom. The area itself is called the Flatiron neighborhood because it surrounds the uniquely-shaped Flatiron building, the point at which midtown and lower Manhattan connect. 


After the recession in the early 2000s, many of the tech companies in Silicon Alley went under, and people who worked in the tech sector had to move elsewhere. In recent years, however, there appears to be a resurgence in possibilities for growth. Employment has gone up by 80 in the last decade and now giant companies such as Amazon, Google, and Facebook will create thousands of jobs with locations in New York. In the eyes of the real estate industry, this immediately begs the question: Where will all these new employees choose to live?


The answer depends on a lot of factors, namely convenience and cost. Most people want the easiest commute possible, but that might also come hand in hand with higher rent. The city of New York is composed of five boroughs – Manhattan, Staten Island, Queens, Brooklyn, and The Bronx. While Manhattan may be where these new tech industries are developing, they might not necessarily be where employees will be living. 


While the term Silicon Alley no longer factually applies because the region is much more widespread than the Flatiron district, most businesses are still planning to build towards the West Side. The Chelsea area and Hudson Yards are becoming the new center of tech, thanks to Facebook and Amazon. This means employees who have the resources are most likely to choose to live on the West Side in order to have a shorter commute. That means Hudson Yards, Chelsea, and Hell’s Kitchen. But that’s where the cost comes in. Not everyone can afford a $4 million apartment. There is another area on the West Side, called the Garment District, which is closer to Midtown. People are keeping an eye on this area because it could turn into rental units down the road, as opposed to being mostly hotels at the moment.